Friday, October 19, 2018

Must we get ready for a bee-free diet?

kw: book reviews, nonfiction, natural history, bees, native bees, pollinators, pollination

Do you like melons, including watermelon? Do you use pumpkin, zucchini, or other squashes? Maybe you like to eat more exotic produce, such as kiwi fruit or passion fruit, or nuts such as Brazil nuts and macadamias. For all of these, pollination by bees is essential. If there were no bees, the yield per acre of these crops, if they could be commercially grown at all, would be 1/10 or even only 1/100 of what it is at present.

Maybe you like apricots, blueberries, loquats, peaches, plums or cherries; or how about almonds or cashews; maybe pears, apples, or raspberries. My wife, along with many, adores cucumbers and eggplant. All of these also need bees to bear well. These crops and many others are listed as having "great" need for bees to pollinate them in resources such as this Wikipedia page. Overall, bee pollination is responsible for about one-third of our food supply.

I have not yet specifically mentioned honeybees. Honeybees can and do pollinate all these crops and many more. For some of them, only honeybees seem to do an economical job of it. But there are 20,000 species of bees so far known worldwide, and 4,000 of them are found in North America. Most of them are pollinators also.

The honeybee is a little larger than average. This one is shown sharing a flower with a sugar bee (AKA bush bee) in Australia; they are smaller than average (Picture credit, in NSW, Australia). When I watch the bees that come to my chives in late summer, I typically see a few honeybees, and many more small ones that are similar to a bush bee. Here in the U.S. many of the littler bees are mason bees, which live in holes in the ground or in wood. In fact, other than honey bees (which are a European import) or several species of bumble bees and carpenter bees, most bees are "little dark things" about the size of a grain of rice.

I won't go into Colony Collapse Disorder or other ills that are presently wiping out so many colonies of honeybees. Rather, with such problems as a background, we need to be thinking about what we will do if the principal species of honeybee soon become extinct. Knowing that there are so many thousands of species of native bees, and knowing that most native bees are also pollinators, we need to ask, can they do the job if honeybees fail?

In Our Native Bees: North America's Endangered Pollinators and the Fight to Save Them, Paige Embry takes aim at this question. As the title makes clear, many of the native bees are suffering declines along with honeybees, for a variety of reasons. Some of them are prone to the same diseases and mite infestations that are part of the problems honeybees are having. Others are being wiped out just because they are "little dark things" that we don't notice when we decide to monocrop a field that was once part of a more traditional (multi cropped) farm; or to spray a new (or old!) insecticide that hasn't been tested for native bee safety; or to either drain a pond or create a new one.

Bee diversity is a big theme of the book. The book is richly illustrated, with photos of many bee species. Many of those photos were taken by Sam Droege of USGS, who produced this montage (I got his photo from the Jones lab at Bowdoin). The great diversity of bees and other insects prone to pollinating has led to an equal diversity of flowers that need pollination. So much so that not all flowers can even be pollinated by honeybees.

One such is the tomato. Ms Embry got interested in bees when she discovered that only bumble bees can do "buzz pollination" that tomato flowers need to release their pollen. Honeybees aren't strong enough. Other flowers are too long or deep. In the picture above, the two bees at the left of the second row are shown with their mouth parts extended. They can pollinate flowers that honeybees cannot reach into. The green one is a kind of sweat bee, so-called because it will also extend that long "tongue" to lick sweat off your body on a hot day. The sweat bees I knew as a child were brownish yellow and looked more like a half-size honeybee. But the ones here on the Atlantic coast of the U.S. are shiny green or green-and-yellow. Sweat bees can sting, not nearly as painfully as a honeybee, but most bees smaller than that don't sting.

A significant few chapters of the book are about BOB's, the Blue Orchard Bees. They are one kind of mason bee that scientists are experimenting with, to see if they can be produced and cultivated to compete with honeybees in, for example, the huge almond and cherry orchards of central California. One benefit of BOB's is that they are much more efficient workers than honeybees, by a factor of about 10! Thus, if you need a hive of 30,000 honeybees to pollinate an orchard (that would be a small orchard), a box of "tube cards" containing only 3,000 BOB's could do as well.

One great problem of beekeeping, whatever sort of bees one keeps, is keeping them alive when the flowers aren't blooming. BOB's don't make honey to tide themselves over the winter the way honeybees do.

As an aside, when I lived next door to a commercial beekeeper, he told me that he and his employees would make sugar syrup, which is much cheaper than honey, to feed his bees over the winter. I wonder how healthy those bees were come spring. The syrup doesn't have all the micronutrients that honey has.

BOB's store pollen instead of honey, and their young winter over in the tubes the mother bee fills with pollen pellets (I am oversimplifying). When they emerge in the spring, they need to find sources of pollen right away. Thus in other portions of the book we read of places such as golf courses that work with initiatives such as Operation Pollinator. Instead of managing the "rough" in a golf course as just another grassy field, the groundskeepers can mix in a variety of blooming plants. Not only do bees do better, but many golfers like the "wilder" (though still managed) appearance of the rough alongside the fairways.

This can also work in our yards. Many suburban yards have flower beds and borders. Most bees are not too picky, so even if we like to plant a lot of non-native flowers, they'll draw bees of many species. But we can also make sure to have something blooming all through the spring, summer and autumn. Even the grassy areas can have some flowers: my yard, for example, has a lot of white clover, which is beloved of many bees. I have a front yard and side yard (the back yard is too shady to support clover). I mow then on different schedules so that there is always some clover in flower somewhere in my yard all summer long. But I have a variety of non-grass areas where I can add more bee favorites.

The author tells us a little of the Great Sunflower Project, which has a few parallel initiatives to collect information about native bees (and honeybees if they are seen). I grew Lemon Queen sunflowers for three summers and reported my sightings to the Project. However, summer is hot and sticky here, and standing around for 15-30 minutes at a time during a heat wave was more than I wanted to bear any more. But I did learn a little about the local native bees. I also got to see goldfinches, which love the sunflower seeds.

This is one of my pictures of a bee on the bloom (the central part of the flower is about 2 inches across). I understand this green-and-yellow bee is also a sweat bee (I am no expert). The most common visiting bees were bumble bees.

I am optimistic that, even if there are many fewer honeybees on the job in the future, native bees can pick up a lot of the slack. All of it? Probably not. It may be that our diets will change somewhat. Meantime, understanding bees better can only help, and this book is a big help.

Spiders going more global

kw: blogs, blogging, spider scanning

A few days ago I noticed a big spike in views of this blog, preceded by some smaller spikes. Here is the audience analysis for the past week. Keep in mind that in a more usual week, 75 views is about average for the U.S., and no other country exceeds 25-30 views. Some time I'd like to hear from the owner of the Russian spider scanner, what they are seeking. The U.A.E. is a new one, and Vietnam scarcely rises into the top ten.

Monday, October 15, 2018

Enjoying whale science

kw: book reviews, nonfiction, whales, science, paleontology, natural history

Almost a year ago, I went with several colleagues from the Delaware Museum of Natural History (DNMH) to look at the skeleton of a humpback whale on the shore of Delaware Bay. It had been a juvenile whale, about 35 feet long, that washed ashore dead near a popular fishing pier. It was towed by the state Department of Natural Resources to a more sheltered spot on a wildlife refuge, to rot in peace. Here are some of the crew having a look. The skull is to the right.

We were mainly there just to see it. The director and a curator were along, though, and they decided to see if the museum could get permission to collect at least the skull. Early this year they applied for the appropriate permit, which was approved. They decided to bring the skull, several vertebrae, and a flipper if they could excavate it from the sand. A large shed was put up in the museum's back yard.

Just about a month ago a few folks went to gather it. The skull weighed about 250 pounds, so it took a few people to lift it onto a flatbed truck. Anyway, they got it safely retrieved, along with several vertebrae and the flipper they could get to. The skull was put in the shed, where I took this picture. You can see that the remaining skin, seen in the photo above, had been eroded and eaten away, leaving just the not-too-smelly bones.

This isn't stamp collecting. This skull is about as big an object as the museum is capable of storing and preparing for exhibit…and exhibiting. A new plan for the exhibit halls is in the works anyway, so they'll tinker with it to find a way to include this, possibly as a touchable piece. It will need a bit of degreasing before it is fit to touch, though! Whale bones such as these are full of fats and oils, even after more than a year in an exposed location.

Reading Spying on Whales: The Past, Present, and Future of Earth's Most Awesome Creatures, by Nick Pyenson, I learned that the Smithsonian Museum's National Museum of Natural History (NMNH) has a series of warehouses on the outskirts of Washington, DC, where research collections and other materials not on exhibit are kept. That includes thousands of whale specimens, including hundreds of skulls.

The DMNH skull is rather small compared to some. The skull of a mature blue whale can be more than 25 feet long, and each lower jaw bone weighs about a ton. It takes a lot of muscle to hold such a pair of jaw bones in place during lunge feeding, but a 100-to-150-ton animal has the muscle to do it.

Dr. Pyenson is a paleontologist at NMNH, specializing in fossil marine mammals. To understand the past of whales, he has spent a lot of time with people who work with living (or recently living, in the case of whalers) whales. He is the kind of scientist I like most, one who gets out of his stovepipe and works with others in allied, and not-so-allied, fields.

True to the title of the book, it is in thirds, for past, present and future. Whales as we know them arose rather recently, roughly 5 million years ago. Fully aquatic whales, similar in shape to modern species but smaller ("only" the size of a minivan or school bus), have been around for something like 35-45 million years. Earlier semi-aquatic "whale ancestors" date to 45-55 million years ago. The earliest "whale", called Pakicetus, was kind of like a big dog that could wade and swim. A significant portion of the author's study is aimed at finding how whales grew to the awesome sizes of the largest ones that exist today. A few species regularly exceed 80 feet in length (24m), topped by the blue whale; the largest blue whale ever measured was 109 feet (33m) long.

A tentative scenario for producing really enormous whales is the combination of a globe-girdling Southern Ocean, but a closure of the Atlantic-Pacific communication that existed until 4-5 million years ago, until the uplift of Panama. Currents and wind patterns cause localized upwellings of nutrients, which in turn cause stupendous accumulations of small prey animals such as krill and herring. Large whales migrate long distances to feed on these bountiful feasts in their seasons. A really big whale has to eat a lot. Being big, though, it can travel more efficiently than a smaller animal, so crossing the Earth to get between areas for feeding and breeding is more possible. There are other factors the author enumerates.

The author's life is at the extreme end of being a naturalist, for which he has to (gets to) travel as far as the whales do, and to all the places where whale fossils or whale remains can be found. He tells amazing stories of field seasons in Chile and Norway and Alaska. He got to try his hand at putting a suction-cup tag on a whale in Alaska. Live and learn: he broke the tagging pole, but got the tag on. Such tags stay on for just a few hours or for a few days, then slip off. Then begins the fun of locating the tag, which fortunately is sending "Here I am!" radio signals. Only then can the scientists download the data and pictures the tag has accumulated, to see what the whale has been doing. He also tells of the astonishing find of a series of four strandings that happened a few million years ago, probably caused by red tide or a similar toxic phenomenon. Dozens of complete whale skeletons were found it a special place in Chile, of sizes ranging up to 30+ feet (9+m). That is as large as whales became at that time. But a single, complete skeleton is usually the find of a lifetime. He and his colleagues were blown away to find acres and acres of them!

Whales today exist as about 80 species, from smaller dolphins and porpoises—roughly human size—through the "usual" 40-70-foot sizes we associate with sperm whales, humpback whales and gray whales, to the really big blue and finback whales. About 8-10 times as many fossil species are known.

What of the future of whales? A generation ago their future was in doubt. Already by the early 1900's, it is thought that 90% of all whales had already been caught and killed, but the catch continued until the 1970's, when a series of international laws were enacted. Some whaling still occurs (and it gave the author a chance to dissect some very fragile portions of whale anatomy). But the chapter "Shifting Baselines" reveals a great problem when a trend goes on longer than a human lifetime. The "good old days" that senior whalers now living remember actually represent a much-depleted ocean. Nobody living remembers a time like the 1600's when whales outnumbered ocean-going ships.

I remember when I was trying to get a multi-level marketing business going, and two women came to one of my presentations, apparently drawn by the "anti pollution" portion of my advertising. But they didn't want to sell my products. They really wanted to "Save the Whales." Considering that this was 1970 or so, the whales they wanted to save consisted of about 3% of the whales that once roamed the seas.

Today a few species have rebounded, but there are still probably no more than 10,000 (some say 20,000) blue whales remaining, and there may be more than one million sperm whales. As Captain Ahab could attest, they are harder to catch than a blue whale. But there were probably at least half a million blue whales 200 years ago, and several million to perhaps 10 million sperm whales. Those are just two of around 80 species.

How will climate change affect the whales? It seems that in recent years some Pacific gray whales (the only remaining gray whale species) have made their way through the Northwest Passage to the Atlantic, something not possible for the past 2-3 million years. However, human shipping is starting to take advantage of the same passage, and ship-whale collisions usually go very badly for the whale.

I could rhapsodize on and on. I really enjoyed this book.

Tuesday, October 09, 2018

A different take on robots and cyborgs

kw: book reviews, science fiction, robots, cyborgs

Murderbot is a cyborg with a conscience. Strangely, the transport-controlling "bot" he calls ART (for Asshole Research Transport) seems to have one also. Maybe ART is part human, as is Murderbot, which is what he calls himself, in preference to an Alphanumeric designation that is never stated. He also uses the term "murderbot" more generically, to refer to all SecUnits; the term isn't explained in Artificial Condition: The Murderbot Diaries by Martha Wells, but it's pretty clear that it means Security Unit.

Unless I missed something, there are three levels of mechanical and part-mechanical entities in Artificial Condition, in addition to non-mechanical humans:

  • Bots, which are probably wholly mechanical, though this isn't always clear in the book. They have various amounts of AI. ART, in particular, is an extremely capable and extremely powerful entity, built into the Research Transport (something like a self-driving Space Shuttle). ART may be part human; that is left ambiguous.
  • SecUnits and their ilk, that exist for specific tasks. They are very dangerous, and have "Governor" units built in to keep them from "going rogue". They have a minor but important human component, including brain, face, and some other portions.
  • Augmented humans, more human, less mechanical, but typically stronger and faster and more capable in chosen ways, than they were before augmentation.
Certain entities may be more like the SecUnit, such as ComfortUnits, AKA SexBots. A ComfortUnit that plays in the story has a Governer circuit also. I guess you'd want a mechanical sex partner that was stronger than you are (so you couldn't hurt it) to be "governed" from hurting you.

As for the plot, I'll just provide a glance at the setup. Murderbot is rogue, having hacked his Governor circuitry, and is thus operating on his own. He is trying to find out if he was truly the SecUnit that "went rogue" some years earlier and killed a lot of people, or, indeed, if the deaths were even due to a rogue SecUnit at all. Parts of his memory were "wiped" so he has to do on-the-spot research. As cover, he poses as an augmented human and has himself hired by a trio of scientists who want to go to the same moon, to retrieve data that was stolen from them. He is to be a bodyguard. ART runs the Research transport vehicle that takes him to a waystation near that moon.

With the help of ART, he takes better care of the scientists than they expected. He and ART have a fraught but useful relationship.

I was most fascinated by the interior life of Murderbot (of course, as imagined by the author). Though this is a small book, it takes an important step in a direction that Isaac Asimov was going with his Robot stories. Does the inclusion of a human brain in a massively powerful cyborg endow it with a conscience? In at least this case, perhaps it does. I don't know if Ms Wells plans more little books (150pp, more or less), to become a Murderbot series. I'd welcome it.

Monday, October 08, 2018

Striking a balance between error and perfection

kw: book reviews, nonfiction, genetics, heredity, inheritance

"Heredity" and "inheritance" were once near-synonyms. Both referred to the physical goods an heir would receive upon the death of his (rarely her) parents or other testator. Carl Zimmer begins She Has Her Mother's Laugh: The Powers, Perversions, and Potential of Heredity by teasing out the history of these words, how they have changed through time. He takes off from there, producing the most amazing book I have read so far this year.

This book is quite a tome, at 600+ pages, and only the author's skill in writing terse, yet gripping prose, kept it from being twice as long. It is more than a review of genes, genetics and their history. We get a behind-the-scenes look at many of the players in the developments that became the modern cluster of "genetic sciences." I was particularly intrigued to learn that Gregor Mendel didn't just grow peas as a hobby, and then keep a diligent diary about it. Throughout Europe there had been "in the air" a rapidly growing interest in selective breeding, and he and his abbot decided on a research program to determine ways of improving the practice.

In five parts, the book draws together nearly twenty big themes, and how each was discovered and, effectively, turned into an engineering discipline. "Genetic engineering" has gone on since the first farmers selected only the grains that were biggest and most easily grown for their seed stock, and since the aurochs was gradually transformed into domestic cattle in a similar, but slower, fashion.

I remember reading a couple of years ago that we pass on to our descendants between 50 and 100 mutations, variations from the genetic baggage we received from our parents. Zimmer brings out something I had not taken thought to calculate: Each of our germ cells—ova for females, sperm for males—has some mutations that differ from every other germ cell. They share many, but each has some unique ones that arose when the individual germ cell was produced from the stem cell. Throughout our body, the total number of mutations may be dozens of quadrillions!

That means that we are all mosaics. A tortoiseshell or calico cat (such as my cat shown here) is a visible mosaic. Each colored patch grew from a single cell in the embryo. In a calico cat, with large patches, the differentiation occurred early, when there were comparatively few cells to develop into the entire cat's coat. In a tortoiseshell cat, with smaller patches, which also tend to be more stripey, it occurred later. A "brindle" cat can be thought of as a tortoiseshell cat whose coat colors are much more finely divided, perhaps just a few hairs each.

"Coat" (skin) color in humans is sometimes visibly mosaicked; a friend of my son in college looked like she had been splattered with gray-brown paint. But in every multi-celled creature, every time a new cell is formed by cell division, either during early development or from a stem cell, there is an opportunity for a DNA copy error of some kind to occur. When that occurs the new cell is genetically a little different from its "sister cells". But, the production of the stem cells also produces variants, so that all the descendants of such stem cells have the new variation. I have a number of brown spots on my skin (on average, people have 25 over their bodies, some less, some more, and some much more). Each grew from a single cell with a different expression of melanin. A key point of this section: Cancer is a mosaic expression.

We are all mosaics, of numerous characteristics, nearly all of them invisible. I find this astounding. Yet it shows the balance between perfect copying and occasional errors that characterize growth and development. For the DNA in a cell to be copied perfectly requires a stupendous level of accuracy, a level not seen outside computer technology. The human genome contains about 3 billion base pairs, meaning that when the DNA is "unzipped" for copying, there are 6 billion bases to be copied.

In a business context, you may have heard of Six Sigma Methodology (6σ), which aims to produce products and services with no more than 3.2 defects per million. There is a dirty secret to 6σ: a "process deviation" of 1.5σ is allowed, so the stated defect rate is actually 4.5σ. True 6σ is actually about one defect per billion. DNA copying, to be perfect "most of the time", requires less than one defect per 6 billion, or a production-perfection level of at least 6.28σ…with no "process deviation".

The perfection of copying computer files is about at this level, but only because of parity bits added to 8-bit bytes, which are actually stored as 10 bits, and checksums for larger chunks, which allow a lot of error correction, and detection of many errors that could not be corrected, so the software doing the copying can try again. Did you know that, when you get a hard disk failure, it is only reported to you after the software has tried 50 times without success to make a copy that passed all the checksum tests and other error-detection codes? Programs like CHKDSK look for portions of the hard disk that cannot yield perfect copies and marks them so the software will no longer try to store data there. The cellular mechanisms for DNA copying include methods that are similar in philosophy, though much different in implementation.

So, more often than not, when one of your cells (or a cell in a cat, horse, tree or blade of grass) divides, the result is a perfect copy. Some percent of the time, a small copy error occurs. Some smaller percent of the time, a larger error occurs, like getting a snippet of DNA turned around or copied twice…and there are other kinds of errors. Some errors are bad enough that the new cell cannot function and so it dies.

But there is another level of "error tolerance", in the DNA-to-protein code. Each amino acid has more than one code associated with it. Some important ones have as many as six, among the 64 3-letter codes that represent the 20 amino acids plus START and STOP. So certain small errors make no difference at all in the protein produced. Such "silent mutations" accumulate, and form the "DNA clock" used to determine how closely related one species is from another, and how long ago the two species split from a common ancestor.

Once in a while a mutation that is not silent actually makes the cell or the organism function better. Such beneficial mutations also accumulate, and over time can lead to new species. Non-silent mutations that are not beneficial may lead the cell or the organism to die, and are thus instantly weeded out, or they may handicap it to some extent, making it less likely to reproduce. This combination of a steady, but low, error rate, and an environmental filter on what is and is not beneficial, is the mechanism of natural selection.

So, back to the thesis of the book, at least in its earlier parts, we find that genetics includes a certain tension between near-perfect copying and the weeding out of most, but not all, copying errors. If copying were perfect, nothing would change (this is the Creationist view). But if copying had been perfect from the first dog, the first apple tree, or the first human, every member of each "kind" would be exactly the same, without variation. You and I would look identical (unless you're female, then you and every other woman would look identical). There would be no moles or other kinds of pigmented spots on our bodies. There would be no mosaicking.

On the other hand, if copying were too sloppy, a large fraction of pregnancies would terminate early in miscarriage, a huge load of birth defects would occur, and everything would die out. Actually, with a little luck, natural selection would drive the surviving creatures in the direction of more perfect copying, until a balance, such as the present balance, were achieved.

The later parts of the book present the several stages of "genetic engineering", including stories of the triumphs and disasters along the way. We are friends of a family named Gelsinger, and a cousin of theirs was Jesse Gelsinger, the young man who died at age 19 of a huge allergic response to the virus that was being used in an experimental genetic therapy for his chronic condition. That particular kind of "gene therapy" came to an end then and there.

Now there is Cas9/CRISPR, and some allied methods (some natural) called "Gene Drives" (only one of them makes use of CRISPR). If these methods fulfill their promise, DNA will become as editable as a Microsoft Word document. Carl Zimmer is guardedly optimistic about the possibilities, but this is the source of the word "Perversions" in the book's title. The genie is already out of the bottle. Not everyone who works with these new technologies is righteous. None is wise enough to think through the implications. After all, less than a generation has passed since Jesse Gelsinger died, and he died primarily because the researchers had not expected allergies to be a problem. Well, Duh! A good friend of mine is most likely to die of taking a breath at the wrong time, in the presence of people eating peanuts. A woman we knew well some years ago came into our house after we had sprayed an insecticide in a back bedroom. She almost collapsed, and had to be half-carried out of the house to fresher air. We could visit her, but not the reverse, thereafter.

Will the new genetic tools somehow "get out" and wind up blasting the biosphere with the biological equivalent of that (so far imaginary) nemesis of nanotechnology, Gray Goo? Maybe. It cannot be ruled out! However, the hope I see, and I think that our author sees, is that there is so much variety in nature, so much variation in the 7 billion of us also, that any biological Gray Goo will not affect everyone. One of his correspondents told him that there have been gene drives unleashed in natural ways in the past, but that the biosphere has eventually deactivated them all.

I have just skated on the surface of a couple of the ideas in Her Mother's Laugh. This book contains more ideas per column-inch than I know what to do with. A tour de force.

Thursday, October 04, 2018

The purported enemy we cannot live without

kw: book reviews, nonfiction, business, debunking, polemics

Whether you are reading this on a laptop or desktop computer, or on a tablet or a phone, that "device" is probably a cornerstone of your life, and it probably cost between two and twenty times the amount of pay you receive for an hour's work. The iPhone 10 or iPhone X currently retails for $999, about twice as much as a pretty good laptop computer, which is close to 40 times the hourly pay for someone with median income in the U.S. Most of the 200+ million iPhones sold in the past year cost between $500 and $800. The amount of money that changed hands was roughly $150 billion.

Why do people pay so much for an item the size of an open wallet? In a word: Value. These "devices" do, not just something people want, but a very great many things most people want, and they want it very much. So they pay.

Now look around the room you are in. If you were to count, from paper clips to furniture, the room you are in probably contains hundreds to thousands of items. Every one of those items was bought at some time, either by you or a housemate or family member, or by someone who gave it to you. In the basement room I am sitting in to write this, I have many books. Probably more than 1,000. There are nearly 30 cookbooks, for example. This computer is accompanied by two printers, a couple of scanners, several reams of paper, a big desk, and a router. A closet holds an oscilloscope and other electronics I use less frequently. On a bench behind me there are two microscopes and a great many things needed to use them effectively. Every one of these things was bought, mostly by me, at some time. The only things in the room that I did not buy is the mineral specimens on a display shelf, minerals I collected. Of course, I bought a lot of gasoline for those rock collecting trips, and I bought rock hammers and chisels, bags, etc., etc.

Every one of those purchased items, except for a very few "loss leaders", yielded a profit to the seller. Why was there a profit? Simply put, incentive. The chance to make a profit is the reason for the existence of any and every business.

Ask yourself this: If you were to go into business selling left-handed fribble widgets, and the materials to make them cost $10 each, but people are only willing to pay $8 each, why would you run such a business? You need a lot of cash to back you up, so you could effectively pay $2 each for people to take a widget off your hands! But if people were willing to buy them for $12, and no matter how many you make, you'd have a never-ending clientele willing to pay $12 each, and then you could really do business. Each widget you sell, you have a 20% capital profit. Assuming they don't take long to manufacture, so there is little time cost, that's pretty good.

But really, why do you need profit? Why not sell them for $10? The biggest reason is, you need to pay yourself for your work. You need the income to buy food, clothing, other things you want, and perhaps pay a mortgage and car payment. You have bills to pay for electricity, water and so forth. There might be a machine you could buy that helps you make widgets faster (though the materials still cost the same). Making more widgets in less time, you can earn more money, but you'll need some of that to pay off the loan you have to take out to buy the widget making machine. So, for a while you have to operate on a thin margin. Maybe net profit for a while is only 5%. But later, you'll have more income each day. Then you can get better clothing and eat out more often.

That is why there is business. To make money for people so they can buy things they don't make for themselves. Now consider, what if instead of widgets you want to make jumbo jets, and compete with the companies that make the Boeing 787 or the Airbus A380. It takes thousands of workers to run such a company. It is not just business, it is Big Business.

Does all business need to be Big Business? No. For every big company there are thousands of small ones. But many people are suspicious of Big Business. Folks complain about all kinds of things, from the high pay of executives to the "cookie cutter" nature of many products that seem like all the others. When my father ran a manufacturing company, he said the profit margin was close to zero; less than 1%. That is long term net profit, after materials, salaries, dividend payments on stock, taxes and utility bills, plus upkeep of machinery. The upkeep was the biggest uncertainty. In most years, there was a profit figure more like 4%, but the company saved it all, because every few years a big, expensive machine would need repair or restoration or replacement, and it would use up most of those savings. The profit figure in such a year might be negative 15%, but they amortized it (spread the cost out over all the years since the last time) to avoid panicking the stockholders. This company was on the boundary between small and big, with about 500 employees. It didn't need to grow any bigger; it fit its market pretty well.

If a company wants to grow, it needs a bigger profit margin. Growing companies have to get the money to grow from somewhere, and there is ultimately nowhere to get it but from current sales. You may borrow to invest in the needed equipment or facilities, but you have to pay it back…with money from current sales. I came across a good quote about profit:
"Any business arrangement that is not profitable to the other person will in the end prove unprofitable for you. The bargain that yields mutual satisfaction is the only one that is apt to be repeated." —B. C. Forbes
Considering that everything you own was sold at a profit, it is odd that so many people are so down on business. In recent years (30+) there has been an increasing attitude that big business is bad in almost every way. Article after article, and many books, are published on this theme, that big business is a big problem.

Well, no doubt some problems are there. But some of the things we hear about and read about are not quite so dire. In 2009 Michael Medved published The 5 Big Lies about American Business: Combating Smears Against the Free-market Economy in an attempt to set the record straight. I recently heard about this book, and bought the e-book. The quote above is from that book.

For me this was an experiment. I wanted to know how much different reading an e-book might be from the paper books I love, my exclusive fare before this. It was actually a great convenience. Since I always have my phone with me (a $150 t-Mobile REVVL, not an iPhone), I could open the book and read whenever I had free time. I have been reading another book at the same time (not finished yet), but that book stays at home, usually by my bedside, and it is big. In another few days I'll finish that book and review it then.

What are the big lies? Putting them more briefly than the author:

  1. The current downturn means capitalism is dying
  2. When the rich get richer the poor get poorer
  3. Executives are overpaid and corrupt
  4. Big business is bad, small business is good
  5. Government is more fair and reliable than business

Let me state at the outset: If you believe #5 is true, stop reading now and go start a business. You might learn something. You can't possibly have had any meaningful experience of either government or business. The Law of Government Spending is, "Nobody spends someone else's money as carefully as they spend their own."

I don't intend to rehash these 5 points. It is well worth reading the book to get the appropriate impact. I do want to address #2. In some cases, the rich really are corrupt and wasteful. But most of the rich got that way by making value where there was none. They did indeed gather a lot of riches, but the people that worked for their companies, the supplier companies they paid for intermediate products or materials, and the people who were able to pay less for their product than the competing one they had been buying before, all were richer than before.

Key learning: Business is not just about moving money around, from one set of pockets to another. Business is about creating or adding value. There is a centuries-old debate about the source of value. People say, "Oh, Gold has value intrinsically. It is valuable just because it is gold." Others say, "Gold has value because people want it." Both are right. Gold is useful and so has intrinsic value. It is also beautiful, so people want it as an ornament. There is a third reason: "Gold has a certain intrinsic value, but when it is in the ground, it isn't worth much because it takes a lot of work to mine it and refine it, and it takes more work to make things out of gold that people will pay for, such as jewelry, or special kinds of wire for electronics, or coins and medallions. Most 'value' comes from labor." This is also right. Much of the value of gold, or anything else "of value" is from the labor of those who mined, refined, produced, or manufactured it. Business creates value.

I'll also touch on #3. Is "income disparity" a bad thing? Some kinds of work, anyone can do. The classic is "digging ditches". When I was a kid, parents would say, "Get a good education. You don't want to become a ditch digger." I never saw anyone digging a ditch by hand (yes, there were backhoes in the 1950's). But we got the point. "Minimum wage" jobs are those that need little or no skill. I made my living for more than half my life as a software coder. That is a skill that is less common, and really good coders (Ahem! Yes, I was really good) are well paid because a lot of code needs to be written, it has to be high in quality, and there are not nearly as many coders as there are unskilled workers. My dad was a business executive. He was paid more per hour or month or whatever than I ever was. He had skills that were less common than mine. Not only that, a good executive or manager doesn't just do work, but facilitates the work of others so they are productive and more work gets done.

Side note: I often eat fast food, including Wendy's. The Wendy's nearest us recently went out of business and was closed. A Starbucks came in a few weeks later. There are other Wendy's places I can go to, and do you know what? I went to the nearby one because it was convenient, and it was "good enough". But compared to the others, the servers were second-rate and slow, and the parking lot was in serious disrepair. At least it was clean; one can always look into the kitchen to see that, and I'd also check the tables and floors. But it didn't do enough business to stay in business. The other Wendy's places I go to now are busier than it ever was. The difference? Management.

Back to #3. Why did the president of DuPont (Mrs. Kuhlman) earn a million dollars per month during my last few years there? Even assuming that she worked a 60-hour week (maybe she worked more), was her time worth upwards of $3,500 per hour? Could she really produce more "value" for DuPont in one hour than I could in a month? The board of directors evidently thought she could. I do know that the company was better run under her, and more profitable, than it had been under the prior two presidents (those between the legendary Mr. Woolard and her). But really, here is who I think is worth $3,500 per hour: the guy who goes in with a screwdriver and disarms a terrorist's bomb. Anybody else, I wouldn't pay more than about a tenth of that, company presidents included. But Medved's writing on this point had me about half convinced that CEO's really are worth their pay. Let's call it a draw.

And…I'll leave it all right there. Do you fear, suspect, or loathe business, especially Big Business? Remember the jumbo jets. You aren't going overseas on your vacation without one. Small business can do a lot, but it can't do everything. There's a place for businesses of all sizes. And that's as it should be. The book is a great read.