Saturday, December 28, 2013

The Art of Brewing Beer and Wine

One of my favorite hobbies was brewing homemade beer and wine. I felt satisfied sitting in a recliner watching TV and drinking something that I made in my kitchen. My home brews had a more mellow flavor than the store bought beers and wines. One of the best beers I ever drank was brewed at home - a Canadian Draft wheat beer. Therefore, I wrote this blog to depart my knowledge to readers who want to start home brewing.

Please check your local laws and regulations about home brewing. This blogger takes no responsibility for readers violating the law in their jurisdiction.


Water is a critical component in brewing a delicious beer. A brewer would never use foul smelling water because the water departs its taste to the brew. On the other hand, brewers cannot use distilled water or water passed through an osmosis filter. Both methods remove minerals from the water. Yeast needs minerals from the water to thrive and grow. I developed a method to control the quality and consistency. I always make two-gallon batches. I would buy one gallon of quality spring water and one gallon of distilled water. That way, I reduce the variations in the spring water quality and ensure the yeast has plenty of minerals to thrive and grow.


Yeast constitutes another critical component in brewing beer. Yeasts are microorganisms that eat the sugar and convert the sugar into ethanol and carbon dioxide. Thus, we are drinking the yeast’s waste products.

Brewers can use baker’s yeast from any supermarket. However, the yeast imparts flavors to the brew, and the baker’s yeast would give the brew a bread taste. Companies use baker’s yeast to leaven bread while they employ brewer’s yeast to ferment wine and beer.

Brewers can use baker’s yeast to ferment a brew. However, as companies produce a batch of bread, they recycle some of the yeast from the last batch and add it to the next batch. Subsequently, baker’s yeast adapts to bread dough after generations after generations.

I recommend novices buy brewer’s yeast from a home brewing website. Prices range between $1 and $5. Different strains of yeasts depart a variety of flavors to the beer, including nutty, fruity, or buttery flavors that complement a brew’s taste. Thus, we begin the art of brewing. Minute changes in ingredients or environment can affect the flavor of beer or wine.

We first must activate the yeast. Take a clean glass and spoon, and pour boiling water over the glass and spoon to sterilize them. Next, fill the glass with spring water and add a tablespoon of sugar. Then add a pinch of yeast. We just need a little yeast and can seal the yeast package and refrigerate it for other batches. 

Once the yeast hits the water, they start eating the sugar and multiply rapidly. The water’s temperature must lie between 70 and 100 degrees Fahrenheit. If the water is too cold, we will not activate the yeast. If we add the yeast to hot water, we can kill them.

Then cover the glass with a clean lid, so dirt and dust do not fall into the glass. I show healthy, growing yeast in a glass in the picture below. Carbon dioxide forms bubbles on the water’s surface while the water becomes murky from the active yeast.

Brewing Material

We do not need to buy expensive containers to brew a wine or beer. A person can go to the discount store and buy a gallon or two-gallon pitcher. I bought a two-gallon pitcher from Walmart that I show below. Many online brewery stores over price their merchandise. However, we must select a plastic that will not leech chemicals into our brew. Plastic manufacturers know people will use food containers to store food so those containers should be okay. However, we want to avoid plastic containers in the household aisle that people use to clean or store non-food items.

Looking at the picture, I left roughly two inches of free space at the container’s top. Yeast fermenting vigorously creates foam. Free space helps keep the foam inside the container. The spout is located about half-inch from the bottom. As the yeast die, they settle to the bottom of the container. The spout has enough height to let the yeast settle to the bottom and lets the brewer pour the liquid into containers. Although yeast residues contain vitamin Bs, they have an extremely bitter taste.

Before I use the container, I clean the container thoroughly with dish soap and rinse. I even clean the dispenser. Then I pour in hot water, close the lid tightly, and shake the container violently. The hot water kills the microorganisms. Brewers never use bleach or strong chemicals, because trace chemicals can contaminate the batch. Brewers can buy sanitizer from the online brewing stores.

Your First Brew

Yeast can ferment any juice or wort. For novices, I recommend their first brew should be an apple juice or apple cider wine. Juice and cider differ as companies make apple juice by filtering the pulp and fiber from the apple cider. Apple wine is the easiest to make, and apple juice produces a mellow amber color with a good taste. However, we can make wine from any juice with sugar. Kroger’s have several naturally frozen juices fortified with Vitamin C that works well. I show a picture below. I always buy natural juices and avoid juices with artificial sugars or high-fructose corn syrup (HFCS). HFCS is an artificial sugar made from corn. Corn contains trace amounts of sugar.

Brewers buy their favorite juice or fruit and ferment it into wine. If they use the whole fruit, they remove the seeds and puree the fruit in a blender. They can also use natural grape juice from the store to ferment into wine. Nevertheless, wineries grow special strains of grapes to produce their wine. At best, a homemade wine would taste better than Mad Dog 2020 but has a lower quality than a $10 bottle of wine unless the brewers grow the right strains of grapes on their plantation.

For the first step, we must calculate the alcohol content of the brew. We must also account for the juice’s sugar. As the yeast consumes the sugar, they produce carbon dioxide and ethanol as waste products. I calculated the theoretical ethanol yields from various table sugar, brown sugar, honey, molasses, maple syrup, and corn sugar in Table 1.

Table 1. Sugar, Ethanol Concentration, and CO2

Sugar TypeSugar
(% sugar)
(1 gallon)
Carbon dioxide
Carbon dioxide
Granulated sugar1 cup201100.03.652.613.9
Granulated sugar2 cups402100.07.2105.227.8
Packed brown sugar1 cup22096.83.8 55.814.7
Packed brown sugar2 cups44096.87.7111.529.5
Honey1 cup33982.05.072.819.2
Honey2 cups68082.010.1146.038.6
Molasses1 cup33774.84.566.017.4
Molasses2 cups67474.89.1131.934.9
Maple syrup1 cup31567.93.956.014.8
Maple syrup2 cups63067.97.7112.029.6
Corn sugar (Dextrose)1 cup120100.
Corn sugar (Dextrose)2 cups240100.04.159.715.8

I calculated the ethanol yield based on a measuring cup because everyone has access to measuring cups in his or her kitchen, but I also provide the sugar measure in grams. If a person has an accurate scale, then always weigh the sugar. Measuring cup is a volume measure, whereas chemical reactions are based on weight measures.

Measuring cups give an approximate measure while weight gives an exact measure. For example, brown sugar clumps and contains air pockets. Depending on how the brewer packs the cup, he or she will have variations in the sugar measure and indirectly the ethanol content.

Examining Table 1, the purity column indicates how much sugar the substance contains. For example, table sugar and corn sugar are 100%, pure sugar, while honey comprises 82% of sugar. I adjusted the ethanol yield to account for sugar purity.

The ethanol column in Table 1 indicates the approximate ethanol content for a one-gallon brew. However, a home brewer can scale these measures. For example, a brewer plans to make a three-gallon batch and adds one cup of table sugar to the brew. That one cup of sugar would contribute roughly 1.2% ethanol by volume, or 3.6 ÷ 3. If he or she adds three cups of molasses to a gallon of brew, then the ethanol yield should be 13.5%, or 4.5 × 3. However, the yeast may die before reaching this alcohol content level.

Subsequently, brewers add sugar to reach the desired alcohol content, but are careful about exceeding 10% alcohol content. For most yeast, as the alcohol content approaches 12% by volume, the ethanol kills the yeasts. Some brewers have yeast that can produce up to 18% ethanol by volume.

If brewers add too much sugar that the yeast does not consume, then they get a sweet brew. If home brewers want a sweet brew, they should add enough sugar to achieve the alcohol content. After the yeast finish fermenting, brewers would add a liquid sugar to suit their taste and refrigerate the brew. Yeast is living organism, but cool temperatures slow them down. They will continue consuming the sugar until the temperature becomes too cold or the ethanol kills them off.

I am big on sterilization. I mix in my natural spring water, the fruit juice, and sugar in a large pot. Then I bring it to a small boil, killing off the microorganisms. Then I let the mixture cool until 100 degrees Fahrenheit and add it to the fermenting container. Then I pour the activated yeast into the container. Some brewers do not heat and boil their brews because it can change the flavor. However, the boiling kills the microorganisms and reduces contamination during the fermentation stage.

Fermentation takes between two and three weeks. Brewers must protect their brew from microorganisms. If bacteria contaminate the brew, they end up with vinegar. Some brewers purchase air locks that allow the carbon dioxide to escape but stops outside air from entering the fermentation container. A brewer does not need that. Did you notice my two-gallon jug has a large green, screw on lid? First, I screw the lid on tight. Then I loosen the lid until pressing on the container’s side, I can hear air being squeezed between the lid’s and container’s threads. If a person tightens the lid so carbon dioxide cannot escape, the pressure will build until the container ruptures and explodes, creating a mess. I show a beer just starting to ferment below.

Referring to Table 1, some brewers also grow plants, so I added the theoretical carbon dioxide yield. Brewers could place their fermenting brew near their plants, and the carbon dioxide would help the plants grow faster. These calculations are based on standard pressure and temperature, which equal 0 degree C and one atmospheric pressure. These numbers seem high, and I showed my calculations at the end of this blog. Thus, two cups of granulated sugar would create about 27.8 gallons of carbon dioxide.

Brewing Beer

Beer’s main ingredient is barley, and brewing beer requires more skill. Furthermore, barley contains little sugar and comprises about 50% of starch. Yeast cannot break down the starch because starch consists of long chains of sugar. Chemists use a hydrolysis reaction to break starch down into simple sugars that yeast can ferment. Chemists use two methods to break down starch – an acid or enzyme. Consequently, one gram of starch yields 1.11 grams of sugar.

I would not recommend using the acid. Chemists can add diluted sulfuric acid or hydrochloric acid to the barley while heating the mixture in water. Then the acid breaks down the starch into sugar. However, sulfuric acid adds sulfur compounds to the beer, which can give it a bitter taste. (That is why commercial wine has a little bitterness from the sulfur compounds). Subsequently, hydrochloric acid adds chlorine compounds to the beer, which would not taste good either.

Brewers use the natural enzymes in barley to break down the starch. First, the brewers malt the barley by soaking barley in water. As the seeds germinate and sprout, the brewers remove the water and dry the seeds. Second, they pass the dried seeds through a roller to crack them. Finally, they add the seeds to water again and gradually heat them. Beer makers can add corn, sorghum, rye, or wheat depending on the use. At set intervals, the brewers halt the heating at 113, 144, and 163° F. The heating helps the seeds release the enzymes that break down the starch into maltose - a simple sugar. Once the liquid thickens and cools, we call it a wort that contains about 11% sugar.

Brewing process is more involved. Experienced brew masters add hops to the malt at set times. Hops add a bitterness and aroma to the beer. Beginners should buy a can of malt extract that makes two gallons of beer. After their skills improve, they could make beer from scratch. As we can see, brewing beer is an art. Every country I visited, the beer tastes differently even though beer companies make beer from four traditional ingredients - water, barley, hops, and yeast.

Brewers using a can of wort make beer similarly to wine. I show a picture below. They heat two gallons of natural spring water and add the can of wort. Then gradually bring the mixture to a boil. Brewers can add table sugar or corn sugar to raise the ethanol level. Brew masters claim table sugar departs a grainy ethanol taste to the beer, so they recommend corn sugar.

Some brewers add other ingredients to make designer beers, but it depends on the brewer. German lawmakers adopted the German Beer Purity Law (or Reinheitsgebot in German) in 1487, where breweries only could make beer from water, barley, and hops. During this time, people were not aware of yeast and microorganisms. Some people retain this tradition and refuse to drink beer with other ingredients. I am open-minded and do not mind adding extra ingredients to beer. Brewers can add pureed fruits or pie filling to the boiling wort to add fruity flavors to their beer. As the yeast consumes the sugars, the residues of the fruit will settle to the bottom of the container along with the dead yeast.

Here comes the dangerous part. Home beer makers gently pour their beer into plastic bottles. I strongly recommend buying plastic beer bottles from an online beer company. Then they add a half teaspoon of sugar to the beer and tightly screw on the lid. Afterwards, they store the beer in a tub or cooler for a week. As the yeast ferments the sugar, it creates carbon dioxide and builds up pressure in the bottle. We need this pressure to carbonate the beer naturally. The bottle can rupture and explode if the brewer adds too much sugar. Then refrigerate the beer, and the cooler temperature will help the beer absorb the carbon dioxide.

Something Goes Wrong

Sometimes a home brew does not taste good. One time, I brewed a batch of beer with a sour taste, but I let the beer sit in the refrigerator for months letting it age. After several months, the taste mellowed and transformed into a decent tasting beer. If a brewer creates a foul tasting beer and the taste has not improved after six months in the refrigerator, then he or she may want to toss the brew out because something went awry.

What happens if a beer tastes like vinegar? Unfortunately, bacteria contaminated the beer. Bacteria eat the sugars and convert them into acetic acid (vinegar) and carbon dioxide. Either the brewer did not sanitize the container properly, or something had killed the yeast. If brewers wash, sterilize their equipment, and boil their wort, then they would rarely contaminate their brews. In my case, I only experienced this one time. I added coffee to my beer to make Buzz Beer (Remember the Drew Carey Show). Nevertheless, the coffee had killed the yeasts, allowing the bacteria to thrive. Thus, I became stuck with two gallons of vinegar.

Appendix - The Calculations

I calculated the ethanol yield for sucrose or table sugar using the chemical equation below. One molecule of sucrose yields four molecules of ethanol. Chemical reaction includes the molecules weights in grams. The ratio between ethanol and sucrose yields 0.538. Thus, one gram of sucrose yields 0.538 grams of ethanol.

I included a volume measure, where one cup of sugar weighs 201 grams. Then I multiplied the purity of the sugar times one cup in grams and times 0.538 to calculate the ethanol in grams.

We want the ethanol as a volume measure. We know the density of ethanol equals 789 grams per milliliter. We divide the ethanol in grams by 789 to yield liters. Then I converted liters into gallons. Since I am making a one-gallon batch, then I multiplied by one hundred to calculate the percent ethanol content, which becomes an approximate measure.

Volume measure introduces two problems:
  • Density changes with temperature.
  • Alcohol and water have an affinity for each other. If I add 0.5 liters of pure ethanol to 0.5 liters of pure water, I do not get one liter. The ethanol and water molecules move closer together yielding 0.97 liters.
Dextrose or corn sugar has a different chemical composition than sucrose. Although we calculate the ethanol yield in the same manner, I used a different ratio between ethanol and dextrose, which equals 0.551. Consequently, one gram of dextrose produces 0.551 grams of ethanol.

Calculating the CO2 differs from ethanol yield because CO2 leaves the liquid as a gas. The ratio between carbon dioxide and sucrose equals 0.514 in the chemical formula. Subsequently, I multiply the amount of sugar in the mixture by the purity and times it by 0.514 to yield the carbon dioxide in grams. Hence, one gram of sucrose creates 0.514 grams of carbon dioxide.

I know one mole of gas occupies 22.4 liters while one mole of carbon dioxide weighs 44 grams. I multiply the carbon dioxide in grams by the ratio 22.4 ÷ 44 to yield liters. Then I converted liters into gallons.

We calculate the ethanol yield from dextrose similarly except the ratio between carbon dioxide and dextrose equals 0.489.

Finally, a starch molecule consists of a long molecule similar to sugar, which I show below. N refers to a large number where C6H10O5 forms a block in a long chain. Hydrolysis reaction breaks down the starch into a glucose molecule - a simple sugar. Consequently, one gram of starch yields 1.11 grams of sugar by taking the ratio between C6H12O6 and C6H10O5.

Monday, December 2, 2013

10 Tricks To Improve Your Writing

I always struggled with writing. After reading book after book, I tried to write better and improve my writing. I explain ten tricks in this blog that authors use to improve their writing. Writers use the first trick to reduce the word count of their written material from 5% to 10%. As writers remove words from their composition, they focus their thoughts and ideas. However, this rule depends on the writer. I struggle to place words on paper, so reducing the word count by 5% works well for me. A writer such as Stephen King who writes volumes upon volumes of words could reduce his writing easily by 20% or more without losing ideas.

Authors apply the second rule to improve their writings - they write for humanity. People are the center of the action. They receive or act in every sentence. For example, I heard a reference that professors write textbooks using a dead language. Read the example below:

The Law of Demand states a greater market price causes quantity demanded to fall, and vice versa while the Law of Supply states a greater market price causes quantity supplied to rise, and vice versa.

I wrote the sentence using correct grammar, but I used abstract subjects. Who represents demand, and who represents supply? Consumers reflect the demand function while producers, manufacturers, and suppliers influence the supply. Consequently, I rewrote the paragraph to reflect the participants who cause the action.

Law of Demand states consumers reduce their quantity demanded as the market price rises, and vice versa. Law of Supply states producers boost their quantity supplied as the market price rises, and vice versa.

Now we explicitly identified which parties do the action without referring to abstract nouns. Readers would find my economics book still boring, but the book would be more readable and bearable.

Writers employ a third trick by remembering the most important pieces of the sentences: Nouns and verbs. A noun refers to a person, place, and thing while a verb expresses a noun's actions. Words such as adjectives, gerunds, and participles modify or add additional details about the noun while the adverb provides extra information about the verbs. Nouns and verbs become the most important brick's in constructing the sentence. Then add adjectives and adverbs sparingly because they detract the readers' attention from the nouns and verbs. Read the example below:

The unfamiliar man asked in a low voice, "Where is the nearest bank?"

Many writers clamor for many words as possible with no regards for quality. I rewrote the sentence as:

The stranger whispered, "Where is the nearest bank?"

Many writers believe a sentence must be full of words to make it intelligent. That is not true. Great writers vary their sentence length. They write some sentences with as little as three words while they write other sentences stretching into 20 words or more. Great writers vary their sentence length to maintain a reader's interest. Imagine you must read a 5,000-word essay, and every sentence strings together 25 words. No matter the essay's topic, readers would become bored reading it.

Ted Cheney's Rule becomes the fourth trick to improve writing. An author only allows one form of the 'to be' verb for every 100 words. I listed the 'to be' verbs below:

     am      is      are      will be      were      was

If your essay has 5,100 words, then remove as many 'to verbs,' so every composition does not contain more than 51 instances of a 'to be' verb. Consequently, your composition would have 51 or fewer 'is' verbs, 51 or less 'are' verbs, et cetera. Writing present tense, I usually litter my composition with 'is' verbs. As I write past tense, I overuse the 'was' verbs. As you eliminate 'to be' verbs, you replace them with action verbs. For example, I wrote the paragraph for my short story – Paying for College.

"I am still sitting in the bushes, waiting. I could not see the other occupant, but this is good news. Chad is the son of Mike, who runs the garage. Mike is permanently on vacation and rarely steps foot in his own business."

Sentence has 43 words with three "is" verbs. I should have 0.43 to be verbs, or close to zero. I rewrote the paragraph to remove the two "is" verbs. Did you notice how I added the verb 'to smile' to strengthen my action?

"I am still sitting in the bushes, waiting. I could not see the other occupant, but I smile at the good news. Chad is the son of Mike, who runs the garage. Mike went on a permanently vacation and rarely steps foot in his own business."

I could eliminate the "am" verb by stating "I sit in the bushes…" but this changes the sentences. I am using a progressive present tense to indicate I am sitting in the bushes for a while.

Writers use a fifth trick to improve their writing. They write using active voice versus passive voice. Active voice indicates the subject does the action, whereas passive voice switches the recipient of the action to the subject. Writers often drop the subject of the sentence, the person doing the action. Therefore, passive voice can create abstract sentences where the reader may not know who does the action. After teaching in the United States and several foreign countries, my foreign students usually write in active voice while my native English speakers write many of their sentences in the passive voice. Passive voice requires a greater depth of knowledge of the English language. For example, this sentence came from one of my research papers.

"Soybean meal is exported or used in animal feeds while the soybean oil is sold in existing markets or converted to biodiesel."

Who exports soybean meal? Extraction mills export the meal. Thus, I inserted extraction mills into the sentence because they perform the action.

"Extraction mills export soybean meal or blend it in animal feeds while they sell the soybean oil in existing markets or convert the oil to biodiesel."

In the process, I sharpened my explanation. I used the verb blend in place of used. Again, using the Ted Cheney Rule to eliminate the 'to be' verbs helps reduce passive voice because writers often create passive voice using the verbs - is, are, was, and were. Nevertheless, writers can create passive voice using other verbs but the 'to be' verbs remain the usual culprits.

Passive voice has its place. Writing a sentence with passive voice mixed in here and there with active voice helps writers vary their compositions. A writer should reduce passive voice but not completely eradicate it. A writer still needs passive voice for the following.

  1. Researchers write scientific papers heavily using passive voice because they believe passive voice removes human judge and biases from the paper. However, some researchers debate this issue. Some researchers write in active voice.
  2. As a writer switches passive voice into active voice, they usually shorten their sentences, especially if the writer includes the recipient of the action in the sentence. Then the writer transfers the recipient to the subject. However, a writer can lengthen a sentence by switching a sentence to active voice. For example, it is forbidden to litter in the park. Sentence is short and to the point. If a writer switched this to active voice, he or she would greatly lengthen the sentence. If the police catch you littering in the park, they will fine and/or incarcerate you.
  3. Passive voice softens the language and expresses ideas politely. From the last example, it is forbidden to litter in the park. Action focuses on the violator. However, switching the action to the police as the enforcers make them sound threatening as if the police are lurking behind the trees waiting for the violators.
  4. As writers compose dialogue, and his or her characters use passive voice, then authors must use passive voice in the composition. For readers to enjoy the writing, the dialogue must flow naturally, and people do speak using the passive voice.

Writers use the sixth rule to strengthen their writing. They eliminate dithering because these words create uncertainty and weaken characters' actions. Dithering words include maybe, possibly, perhaps, and try. For instance, I wrote this sentence for my short story, Paying for College:

There is no way I would try to cash these.

Analyzing this sentence, the verb try 'makes' the character sound uncertain. Did you notice the 'is' verb? Many writing guides suggest writers remove all forms of 'there is.' After I rewrote my sentence, the sentence becomes:

No way would I cash these.

I strengthen the character's action by eliminating the verbs 'is' and 'try.' I hinted at the seventh rule to eliminate all forms of 'there + verb.' After thinking about it, does 'there + verb' add any meaning to the sentence? Examine the following sentence:

There was a tornado that destroyed the town in 1995.

I rewrote the sentence to eliminate 'there was.' Even Microsoft Word 2010 caught this error and suggested correctly to remove there and that. I added the verb 'had' to change the sentence to past perfect because this one event struck the town at one time.

A tornado had destroyed the town in 1995.

I listed the common other forms for the 'there + verb' construction. The Cheney Rule would help eliminate the first four. From the old school of writing, English teachers would call the writers lazy when they used the 'there + verb' construction. After writers become skilled in editing, they can eliminate this sentence construction easily.

There is
There are
There were
There was
There had been, etc.

Writers can use the eighth rule to reduce the word count in writing. This rule works well for novels and fictional stories. A writer can eliminate 'the' in most cases if it is the first word in a sentence. Read the paragraph from Paying for College:

The Buick's engine roars into life. The car has a severe case of rust-leprosy, and the exhaust was rattling badly as if the car is ready to fall apart. Then the car pulls onto the street and drives away.

I removed 'the' when it appears as the first word in a sentence. Did you miss it? This rule can help remove words from a composition, reducing the word count.

Buick's engine roars into life. Car has a severe case of rust-leprosy, and the exhaust was rattling badly as if the car is ready to fall apart. Then the car pulls onto the street and drives away.

Writers use the ninth trick to eliminate any words that add nothing to the sentence. I listed five adverbs that add none thing to a sentence. Mark Twain quoted about another useless adverb – very. He said, "Substitute 'damn' every time you're inclined to write 'very;' your editor will delete it and the writing will be just as it should be."


Think about it. Do any of these adverbs add any ideas to the sentence or even add information to the verb. I threw these adverbs into the paragraph below.

Corporatism essentially comes in a variety of forms. In some cases, government ultimately dominates the relationship and regulates its industry. Inevitably, this management style is a top to bottom approach and apparently similar to the way communistic countries control their industries.

I removed essentially, ultimately, inevitably, and apparently from the sentence. Did these adverbs add any meaning to the sentences?

Corporatism comes in a variety of forms. In some cases, government dominates the relationship and regulates its industry. This management style is a top to bottom approach and is similar to the way communistic countries control their industries.

Abruptly becomes another abused adverb. Many writers insert abruptly into a sentence to accelerate the prose's action. This is not necessary. Short sentences and paragraphs containing action verbs speed up the action while lengthy paragraphs and long sentences slow down the pace. Read the following sentence. Does it need the adverb abruptly?

A criminal bursts into the room with his gun drawn. Bam! Bam! Bam!

Finally, some writers recommend eliminating the following words from their writings. These words contribute little meaning to a sentence.

Appears to
As though
It would appear
Like a
Looks as though
Looks like
Reason + verb + because
Seems to
Seemed like
Seemed as though

Office software has given writers a vital tool to edit their written material. An author can use the search function in Word 2007 and higher to edit his or her writing. For example, I type in 'Space is Space' in the navigation bar and Word searches for every instance of 'is.' If I did not include the spaces, then Word would include 'this' or 'island' if they appeared in the text. That way, Word gives the writer an accurate count of 'is' for the Cheney Rule. Moreover, a writer can use Find next to locate the next word in the composition. If a writer uses contractions in his composition, then he or she must also search for 'isn't'

New writers are horrified to remove words from a composition after they had struggled to put the words onto paper in the first place. Putting words onto a paper starts the first step to writing. Writers must learn the art of editing to sharpen and focus their prose. Good editing requires the writer to remove the most words as possible without losing ideas and meanings. For example, would a reader appreciate reading a novel with 100,000 words or the same novel where the writer had reduced the word count to 60,000 without removing ideas?

Tuesday, November 19, 2013

The 12 Rules of How Not to Manage an Organization

I replaced my university's name by 'Inept University' to protect the innocent and hide the guilty, and not create further trouble for me.

[INEPT UNIVERSITY] leaders strain to transform [INEPT UNIVERSITY] into the Eminent Management University in Malaysia and possibly the world. I have no idea where the administrators dreamed up this mission statement. Do not get me wrong, universities and colleges are extremely bureaucratic and poorly managed institutions. However, [INEPT UNIVERSITY] is the worst of the worst. Sometimes, I dream I am superman, and I fly around and help people, but I do not go around and tell anyone. Otherwise, people would think I was crazy. After reading this blog about this university, this idea of [INEPT UNIVERSITY] becoming the Eminent Management University is completely insane, but this leads to our first rule. Bureaucratic institutions with severe management problems can craft clever slogans and mission statements and conduct slick public relations campaigns.

Rule 1: Bureaucratic organizations become very good at crafting clever, intelligent mission statements and fabricating excellent public relation images.

I copied this mission statement directly from the [INEPT UNIVERSITY] website. The mission statement is a little wordy but common in the education industry. University informs everyone how great the university is.

"To be a consistently pre-eminent centre of academic excellence in teaching and learning, research, consultancy, and publication in the field of management, and, at the same time, to bring forth highly competent human capital that is commited to serving in the development of the nation and all humanity."

Analyzing this mission statement, parts are completely false. "..excellence in teaching..." Really? Who thought this up? I became shocked and enraged after a student told me most professors do not return exams, homework, and quizzes. In most classes, students do not know how well they are doing or which grade they are earning until after the class ends. I do not think I could do well in these courses because I would not know how long to study, how the professor grades exams and homework.

Problems at [INEPT UNIVERSITY] go beyond teaching. Old computers and equipment that are older than the students sitting in the classrooms fill every classroom. I had trouble with the computer and equipment weekly. Viruses infect at least half the computers while the computers break down frequently. For one class, the electronic lock had failed, and the students and I were locked out of the classroom. I switched classrooms. However, the bureaucrats still found ways to create problems. First year students must scan in their ID on the time clock to record their class attendance. Administrators marked all my students absent that day even after I informed them what had happened with the door.

My university's troubles exceed the false visions and mission statements. [INEPT UNIVERSITY] has evolved into a bureaucratic nightmare, adding layers upon layers of management. I taught in the College of Business, and these managers separate me from the Vice Chancellor:

  1. Vice Chancellor - president of the whole university
  2. Assistant Vice Chancellor - have no idea what this person does
  3. Dean of the College of Business - supervises the economics, finance, and banking departments
  4. Deputy Dean of the College of Business - have no idea what this person does
  5. Department Head - supervises the economics department

Remember that old saying - too many cooks spoil the stew. With [INEPT UNIVERSITY] being overly bureaucratic, the managers insulate themselves in their offices, processing volumes of documents. They never once popped into my office to see what I was doing. I even tried to pop in and ask questions, but most the time, the managers lock their doors and isolate themselves, which becomes Rule 2. They send commands through their staff. Since some professors lack motivation, the staff always demands and snaps commands at the professors. They never politely ask or request for things. You must do it NOW even if I am in the middle of teaching a class! Drop everything you are doing! Come to the committee room now! The dean must see you now! If I were dean, I would not hide in my office. I would be knocking on people's door, finding out what people are doing, and what they are working on.

Rule 2: Leaders who isolate themselves from the workers provide poor leadership. They do not inspire, encourage, or develop healthy relationships with their employees.

Many universities want to transform themselves into a research university because they are prestigious as professors conduct breakthrough research. Furthermore, accreditation hinges on a university conducting research because professors bring that knowledge into the classroom, teaching students the most up to date methods. Unfortunately, many universities focus on research and neglect teaching.

I will let you know a little secret. Many university researchers write research papers that contribute little to their fields, playing a numbers game with the university. If we eliminated 80% of the published research, humanity would never miss it. If we eliminated another 10% of research, humanity would lose some knowledge, but we would survive. In every field, a handful of researchers discover the breakthroughs while the remaining researchers play catch up and regurgitate and recycle the research with new angles.

[INEPT UNIVERSITY] leaders want to transform [INEPT UNIVERSITY] into a research university, but they do not know how to achieve their goals. They created the KPI that outlines the duties and responsibilities of every university employee including the managers. Malaysian government uses the KPI to boost workers' productivity. (Remember the movie - Office Space? KPI is the new TPS Report - a mindless, useless report that all managers want in the movie with the correct cover page). Every few months, the administrators incessantly change the employees' goals and duties, which becomes Rule 3. As an employee, how can I complete a goal if I know my goals will change in several months? I could organize and perform research on a subject that satisfies my current KPI. When the administration alters my KPI, then my efforts and work could become wasted if the project satisfies the old KPI and not the new KPI. After my third KPI, I ignored the KPI and revived the old rule. I will teach my classes and publish research papers that I want.

Rule 3: Managers constantly changing the goals, duties, and mission of their employees do not know what they are doing. If a manager knows which goals his or her employees must accomplish, subsequently, the managers would outline their duties and then monitor their progress. Indecision reflects poor leadership and incompetence.

Bureaucrats can divert activities away from its core mission, which leads to Rule 4. A university has two goals: educate students and conduct research. For example, [INEPT UNIVERSITY] wants to enroll more foreign students. [INEPT UNIVERSITY] advertises and sends professors to foreign countries to meet with potential students. Some students become interested and contact the university. Bam! Then the students meet the [INEPT UNIVERSITY] bureaucrats. [INEPT UNIVERSITY] bureaucrats never return phone calls or answer emails and ignore the students. Frustrated students give up and move on to another university. Consequently, [INEPT UNIVERSITY], on one side, tries to recruit students while, on the other side, the bureaucrats are chasing the students away.

Rule 4: Bureaucrats can divert activities away from its core business and in extreme cases can undermine their primary mission.

[INEPT UNIVERSITY] has almost no transparency. I do not think the leaders designed the organization this way, but [INEPT UNIVERSITY] bureaucrats will not divulge any information. Employees wait for commands from upper management, and they avoid trouble by not divulging information that managers will change later. Upper management changes their decisions like the Malaysian weather. Skies are clear and cloudless one minute, and a minute later, thunderstorms are dumping rain from the skies. When I first arrived to the university, no one explained the rules and procedures. I relied on an expatriate professor who has been teaching at [INEPT UNIVERSITY] for a while. For example, no one would say definitively when my contract ends. Normally, the end date is explicit in the contract, but [INEPT UNIVERSITY] starts the contract the first day the professor arrives and not the date within the contract. I could never get a straight answer from the administration, but they keep paying me, so I still stick around.

Rule 5: Nontransparent organizations become susceptible to arbitrary rules and decisions, and in severe cases, fraud, and corruption permeates the organization.

I never seen anything that could be defined as fraud or corrupt, but I have never seen any financial statements from the university and I do not want to see them. However, the rules are arbitrary. For instance, the department will pay professors a bonus for publishing a research paper. Nevertheless, this is not entirely true because at the end of every rule should state "at the discretion of the dean." I learned the administration will pay the local professors the bonus but withhold the bonus from foreign faculty because the foreigners earn greater salaries.

As bureaucracies expand and become more complex, they create complicated budgets that cause bureaucrats to waste and squander resources and money, which becomes Rule 6. For example, the university needs to replace the ancient computers and equipment in the classrooms, but bureaucrats have not allocated money for new computers in the budget. However, the dean for the College of Business demanded every professor to attend training during Spring break in the Cameron-Highlands at the Heritage Hotel. At first, I was happy because the university paid the workers to see another part of Malaysia. However, the organizers turned the workshop into a nightmare as the bureaucrats wasted time and money. They needed to spend all the funds in this one account or the College of Business would lose the money.

Bureaucrats locked us in the hotel for two days, participating in the most boring workshops, stretching half-hour presentation into hours. I became furious on my first night there as the dean kept us until 10 PM. One hundred and fifty people with PhDs and Master degrees filled the conference room. Dean's brilliant team building exercise was to have every team construct a newspaper tent that could support a bottle of water. WTF?

I shook my head in disgust because the university paid a substantial amount of money to transport, feed, and house 150 faculty and staff at a hotel. Yet, I enter my classroom every day to teach, using those damn, ancient desktop computers running XP. Dean could have locked us up in a conference room on campus and made us pay for our own lunches and dinners. Then he could use the money to replace all the old computers and equipment.

Rule 6: Bureaucratic institutions create complicated budgets that cause administers and bureaucrats to waste and squander money on the wrong activities.

Bureaucratic organizations can erect walls and divisions between managers and workers. Managers develop an us versus them mentality. Consequently, managers groom and promote new leaders based on loyalty and not on merit, which becomes Rule 7. In my case, the department paired me with a young professional who was the rising star in the department. We had to coordinate and teach the identical course for multiple sections of this class. It was horrible. She changed things at the last minute and would not inform me such as altering the syllabus and exams. Half way into the semester, she hands me the new textbook where I had been teaching from the older edition book. My personal favorite - she waited two hours before the exam before emailing and asking me to help proctor the mid-term exam. Enough is enough! I told her I refused to work with her anymore half way into the semester. Unfortunately, I sealed my fate and doomed my career at the Eminent Management University.

Rule 7: Bureaucratic organizations promote employees to management based on loyalty and not on merit.

Managers and leaders isolate themselves in their offices processing documents and reports. They demand we professors write research papers, apply for grants, and consult for industry. Professors always write glowing reports how we applied for an international grant and give the details, or we recently submitted a research paper. Then the managers pass the reports up the management chain. I would never accept a grant, always sabotaging my efforts. If an international agency had given a grant for research, then the university requires me to transfer the funding to the administration so the bureaucrats can control the money. My colleagues complained many times about their struggles for reimbursement from the administration while reimbursement stretches into months. Accordingly, our leaders have trouble managing and monitoring us, which becomes Rule 8. At one point, I snuck away from the university for two weeks to travel in Indonesia, and no one noticed.

Rule 8: Bureaucratic organizations have trouble coordinating, managing, motivating, and monitoring workers.

As you guessed, workers and professors lack motivation at my university. They arrive to campus and teach their courses. Then they flee the campus silently, avoiding the leaders' offices, just in case the leaders happen to be looking out their office windows. In the academe, I hear the magic number many times - 10 percent. At many universities, 10% of the workers do all the work and carry the 90% who sit in the break rooms, gossiping about the TV shows and the people around them.

Managers have resorted to intimidating the professors to boost the professors' productivity - i.e. that research defined in the KPI. Dean emailed the entire foreign faculty and requested we meet in the committee boardroom. Dean sat at the head of the table while we professors sat on one side of the table lined up like ducks at a shooting range. Then the College of Business department heads, advisors, and coordinators came in solemnly and sat along the wall at their special table like inquisition judges. Dean outlined our research plans, changed our KPI again, and demanded we professors start producing research while the inquisition judges glared down at us. Ironically, most foreign professors had published research while the dean and inquisition judges have produced nothing except for one.

Rule 9: Leaders and managers threatening and intimidating their employees reflect severe management problems in an organization. Consequently, the organization is doomed as employees begin fleeing.

I work for a university where the leaders and managers refuse to communicate to me except when they demand a document. Managers have isolated themselves from us, and I feel no connection or dedication to my employer. I stopped going to my office, and I work at home. I try to teach my classes well, but my morale and work ethic has suffered in the other areas at my job, which becomes Rule 10. I have not committed sabotage or done anything to my employer, but I am far from a good employee. I have a journal article being reviewed. If the journal accepts my article, I will not inform the dean or anyone at the university. I know their KPIs depend on faculty publishing research, so I will not help boost their KPIs. Of course, my managers hold me in such contempt; they probably would not even consider the publication if I had informed them.

Rule 10: Employees' morale and work ethic suffers if the managers and leaders mistreat them. Employees may sabotage projects and deliberately reduce their productivity in revenge, striking back at their bosses.

Sometimes, the [INEPT UNIVERSITY] bureaucrats do crazy things, which become Rule 11. Then couple this with the Asian mentality where a subordinate can never challenge a manager's decision. For example, bureaucrats at [INEPT UNIVERSITY] continually change document formatting. Professors must adhere to the exact format for writing the final exam questions. Last year, professors had to write the exam questions using Arial font and paragraphs were not justified. This year, the supreme committee of upper management in their infinite wisdom had decided, professors must use Times Roman font with justified paragraphs. Then a committee of PhDs breaks out their rulers, analyzing and examining every professor's final exam for question content and formatting. Of course, a bureaucrat cannot create a template and email the template to the professors. Bureaucrats continually create work for the professors. Their pettiness truly dazzles my mind. For another instance, the bureaucrats had rejected my syllabi for my classes. Last year's syllabi had the university's logo while this year, the committee wants the professors to remove the logo. (I am not making this up).

Rule 11: Sometimes, extremely bureaucratic institutions do crazy things without any thought, reason, or logic.

Last Rule, Rule 12, kills organizations, causing them to stagnate and go into decline. Leaders and bureaucrats fostering a terrible, hostile work environment force its employees to transfer and work for rival employers. Even at my university, some workers and bureaucrats work hard and try to do their jobs well. I become disappointed and frustrated when I pop into an office where competent, hardworking people work and learned they quit their jobs and started working for another organization. A new employee takes over and must learn how to do their job and duties. Consequently, a high turnover rate hurts the bad employer in three ways. First, employer can lose institutional memory when fleeing employees take their knowledge and experience with them. Second, competing employers will hire and poach the best employees from rival companies while poorly managed organizations become filled with bad employees over time. Finally, the fleeing employers may work harder for their new employers, subconsciously getting back at their previous bosses.

Rule 12: Severely mismanaged organizations experience high turnover rates with its personnel. Unfortunately, the organization can lose its best employees as competing organizations hire them. Over time, the mismanaged organization becomes stuck with poorly motivated, low-skilled workers.

Many bureaucrats and leaders poorly manage their institutions and would break half these rules continually. However, my special university in Malaysia violates all these rules daily. What is hysterical is the Vice Chancellor gave a good speech about companies and countries that grew fast but went into decline. He said we must adapt and change with our environment and remain competitive. However, the president needs to examine his own institution especially his management team. Bureaucrats and leaders can write glowing reports and documents and blame others for an institution's failures. Many failing companies and stagnating countries institute overbearing bureaucracies that hindered growth and stifled change.

Problems at [INEPT UNIVERSITY] will continually worsen. Bureaucracies grow over time, and the [INEPT UNIVERSITY] bureaucracy already interferes with its mission - conduct research and educate students. Bureaucrats will create new paperwork, procedures, and processes that halt all progress and chase the good employees from the university. Bureaucrats are pesky flies multiplying on the piles of cow dung spread across the college campuses. We professors are doomed.

Wednesday, November 13, 2013

Is North Korea being Aggressive?

Political leaders, news reporters, and analysts claim North Korea is being aggressive towards the outside world. However, the U.S. military performs joint military exercises with South Korea. South Korea conducts military exercises near North Korea’s border while the U.S. military flies airplanes near the border. Then the United Nations with the approval of the United States imposed further sanctions on North Korea. When North Korea fired artillery onto Yeonpyeong Island, a disputed territory between South and North Korea, was North Korea being aggressive or sending a message to South Korea and the United States to back off?

The United Nations imposed sanctions on North Korea because North Korea is developing nuclear weapons and missile technology. In North Korea’s defense, a country with nuclear weapons has never been invaded by another country. Unfortunately, nuclear weapons depend on early 20th century technology. They are simple devices that depend on refined uranium 235 or plutonium 239. That is the only complexity of developing nuclear weapons, purifying and refining uranium or plutonium into weapons grade. On the other hand, North Korea could be using nuclear weapons and missile technology as a bargaining chip with the United States. For instance, North Korea could suspend its nuclear program if the United States opens diplomatic relations with North Korea and sends more aid. Unfortunately, both sides refuse to talk to each other.

Many Americans advocate invading North Korea. They believe the war would be quick and decisive. This could be a terrible idea. People had forgotten history. The Korean War (1950-53) ended in an armistice. Both the South and North Korean militaries put their weapons down and stopped fighting on July 27, 1953, and they never signed a peace treaty. Thus, the war ended in a tie with no winner. As the United States sends more ships and troops to the Korean Peninsula while South Korea performs military exercises near the border, North Korea had canceled the armistice in March 2013 as tension between the two sides continues escalating.

Many Americans had forgotten the United States military helped South Korea during the Korean War, and that war ended in a tie. Unfortunately, we have fared no better with our recent military excursions. U.S. military has occupied Afghanistan for over 12 years with no end in sight. U.S. military had killed the top leaders of al-Qaeda, but the U.S. military still controls a land locked country filled with sheepherders, mountains, and rocks. Under these conditions, the U.S. government still has trouble controlling Afghanistan even after the Soviet Union had worn down Afghanistan during the 1990s. Furthermore, the U.S. military has invaded Iraq and occupied the country for 12 years with no end in sight. U.S. military has invaded Iraq twice because the U.S. military had invaded Iraq in 1991 after Iraq invaded Kuwait.

A new war between North and South Korea becomes likely as tensions intensify. Let us say the U.S. military does invade North Korea. Everyone assumes North Korean missiles cannot reach U.S. soil. They only develop technology to fire mid-range missiles that could reach the U.S. military base in Guam. Experts claim North Korea does not have the technology to fire missiles that would reach the continental United States. Does anyone want to gamble on this? Besides, if North Korea does not have the technology to fire long-range missiles, military can mount missiles onto ships and sail them closer to their targets. Moreover, the U.S, military would have problems fighting a war with North Korea because the military would pull troops away from Iraq and Afghanistan. Thus, U.S. military spreads the troops and resources over three battle fronts. Opposition and rebels can rise up and successfully attack U.S. soldiers and bases. Napoleon and Hitler had opened two fronts, and both dictators lost the war.

Why must the U.S. government intervene in North and South Korea’s conflict? Where does the U.S. Constitution state the U.S. government must be the world’s police officer? Subsequently, if the U.S. government triggers a war, it must finance the war and its finances are not healthy as the U.S. government debt clock has ticked beyond $17.1 trillion. U.S. economy remains weak with sluggish, nonexistent job growth. U.S. government should worry about the weak economic recovery within our borders because a weak economy causes weak growth in tax collections. Unfortunately, a weak economy coupled with a high debt converts the debt clock into a ticking time bomb.

United States government is isolating North Korea. If the U.S. government wants to change North Korea, then get the North Korean government to open their economy to free trade. Free trade moves new products, services, and ideas across a country’s borders. After the people taste free choice, consumer products, and new ideas and technology, they will demand their government to open up more. We see this happening in China. Communists still control the government in China, but every day, they open and liberalize their economy more until one day, the government will grant freedom to its people. Forcing open North Korea’s economy would change the system more than the United States and South Korea triggering a war with North Korea. Missiles and bombs would not destroy cities, and no soldiers would die.

Friday, October 25, 2013

Thoughts about the 2010 Affordable Care Act

President Obama and Congress passed the Affordable Care Act to help 48 million Americans gain health insurance. With a population of 300 million Americans, roughly 16% of the U.S. population has no health insurance. Unfortunately, I find this law troubling because, in the old days, people had a choice to buy insurance or not. Insurance was voluntary. People bought insurance because they were preparing for emergencies or unexpected losses. Regrettably, the U.S. government has ignored simple economics, which I explain in this blog.

U.S. government creates a problem by forcing people to buy insurance. Out of that 48 million Americans, how many young people do not want health insurance? Young people believe they are invincible, and few would buy insurance. Usually people who buy insurance expect to use it. Some of 48 million include low wage earners, or the insurance companies had denied medical insurance to people with preexisting medical conditions.

Insurance companies reject applicants with health problems because the companies expect to pay out more in insurance claims as the applicants seek more medical treatment, boosting the insurance companies’ costs. Consequently, the new federal law may help low wage earners and people with preexisting conditions acquire medical insurance. However, the young people will help subsidize the health insurance because most are healthy and rarely seek medical treatment.

Another side effect of the law is insurance companies gain market power. With a population of roughly 300 million Americans, the United States has 38 insurance companies. I listed the companies in Table 1 at the end of this blog. U.S. government has conferred monopoly power to the insurance companies because the government guarantees these companies 300 million consumers. On average, each company would insure 7.9 million people. Consequently, the companies can hike insurance premiums and offer lower quality insurance because consumers cannot choose whether they want health insurance or not. They must choose one of the 38 companies in the United States. Then Aenta, one of the largest insurance companies, announced it plans to exit the health insurance market.

Using a perverse example, we can show how this health care law can limit market power. Let’s say the U.S. government forces all drivers to buy road flares that must be stored in the car’s trunk. That way, a driver with car trouble can pull over and place flares on the road, so another driver does not crash into the car. What would happen if the United States has three companies that made road flares? U.S. government has granted them market power, so they can increase the price and earn massive profits. Subsequently, the companies could funnel some profits to the politicians as campaign contributions, showing their appreciation of the new law.

New health care law shows the problem of pathetic news quality. Since the 1990s, I held a low opinion of the U.S. news and newspapers because reporters never cover news stories in detail as the reporters always skim the important facts. I became angry when the reporters ignore essential facts of the new health care law. Most reporters wrote the U.S. government would fine any person $95 in 2014 for not having medical insurance. That is not completely accurate. Fine is $95 per adult or 1% of a person’s income, whichever is greater. Thus, an adult earning $20,000 per year would pay a $200 penalty for not having health insurance and not $95. Then the penalty rises to $325 per adult or 2% of income in 2015, and $695 or 2.5% of income in 2016 and after.

I listed the penalties in Table 2 for individuals, children, and families. Furthermore, experts claim the IRS has no enforcement powers to collect the tax. When a bureaucrat has a will, he or she will find a way. IRS will devise a method to collect the penalty. Most likely, the IRS would rearrange a taxpayer’s payment. IRS would apply a taxpayer’s money to the penalty first and then demand more money to apply for the actual taxes. Of course, everyone assumes the taxpayers will continue submitting forms to the IRS. People in many countries, such as Italy, Greece, Spain, and Portugal, evade and elude taxes as tax dodging has become a favorite pastime for some of their citizens.

U.S. government created another problem because it had promised the people that they could keep their current medical insurance and current family physicians. Unfortunately, the U.S. government did not anticipate how businesses and people would respond to the law.
1.     Some insurance companies offered health insurance that does not comply with the new law. Consequently, insurance companies had canceled these plans instead of complying with the law, leaving between 7 and 12 million people and families without health insurance.
2.     U.S. government taxes people and families with generous health insurance plans. A tax penalizes an activity or behavior, and government penalizes people with generous health care plans. Hence, insurance companies, people, and families have an incentive to reduce their plan’s benefits to reduce their tax burden.
3.     U.S. government has left some doctors out of the health insurance network. Thus, some families who saw their family doctor for years can no longer see them. This raises a good question – if the government leaves some doctors and hospitals out of the health care plan, will the hospitals close, and the doctors retire? This would reduce the supply of medical services that raises prices for medical services.
4.     Employers do not pay for health insurance if they work their employees fewer than 30 hours per week. Some people have lost hours as their employers switch them from full time to part time. Unfortunately, the people with reduced hours may have to purchase health insurance out of their own pocket if their salary exceeds $10,000 for a person or $20,000 for a family.

As the name suggests, the Affordable Care Act should reduce medical costs. Can you name a government program where government had reduced costs or prices? Every industry and market a government interferes with cause greater market prices. Putting this fact to the side, everyone overlooks one important fact. If the supply of medical services remains the same while people demand more health care because they have medical insurance, the market price always rises. As more consumers compete for the same supply, the consumers bid up the prices. Then I read articles here and there. For instance, the IRS will hire 6,700 agents to enforce the insurance penalty. Then federal and state governments must hire bureaucrats to work in the new medical insurance exchanges. Through my readings, I never read a story where hospitals and clinics plan to hire more doctors and nurses. If the U.S. government wants to reduce the price of medical care, it must expand the supply for medical services. If the market supply grows faster than market demand, subsequently, the market price always falls. As hospitals and medical clinics expand their services, they would lower their prices to attract more consumers to their facilities. On the other hand, I have read several hospitals will close.

The Affordable Care Act does not fix the flaw with the medical industry because the health insurance companies isolate the payments between patients and hospitals. Our current health care system provides no incentives for patients, hospitals, and clinics to reduce costs. Patients pay a fixed price to visit a doctor, usually $20 copay. Patient could request the doctor to perform 20 tests, and the doctor would comply even if he or she thinks some of the tests are unnecessary. Doctor bills the insurance company for the tests and not the patient, thus sticking the third party with the bill.

Healthcare system would change if the patient had to pay a percentage of each test. For example, if the patient must pay 10% of every test cost, the patient would start asking more questions about the tests and would question whether the doctor should perform 20 tests or not. Patient’s bill becomes tied to the number of tests the doctor performs. Furthermore, the doctor may limit the number of test especially if the doctor knows the patient has little income to pay for them.

The Affordable Health Care law creates another problem - intrusiveness. People who cannot afford health insurance or do not qualify for Medicaid or Medicare can buy health insurance through exchanges. Unfortunately, applicants must fill out a government form spanning across 21 pages. Most questions cover financial information and contain little health information. Supposedly, as a person enrolls into an insurance plan, the exchange shares information with other federal agencies such as the FBI, IRS, NSA, et cetera. Our political leaders think similarly to the Soviet planners. Soviet citizens applying for a government program or need a government document had to supply numerous documents to the bureaucrats. I call it the bureaucratic shuffle because a trip to one bureaucracy would lead to multiple trips to other bureaucracies as citizens gathered various documents.

Patients lose their privacy as the state and federal government collect information about them. I tried to research which agencies the health insurance exchange shares information with, but this information had disappeared from the internet. Remember George Orwell’s novel - 1984. Government controlled information and the main character, Winston Smith, worked for the Ministry of Truth. As the government changed and updated information, Winston had to correct every book, newspaper, and piece of information with the new information. I apologize for digressing, but I became surprised this information had disappeared from the internet so quickly. I know I read about the exchanges sharing information with the federal government agencies because people had trouble enrolling into insurance plans. Computer system experienced bugs as it shared information with these government agencies, preventing applicants from enrolling into a plan. Of course, thousands have browsed the exchange website to check rates, but the U.S. government has not revealed how many people it has enrolled. Analysts estimated the U.S. government had enrolled a half million people in mid-November 2013, far below its projections.

Government leaders forget economics is about choices. I liked how Kazakhstan had set up its medical industry. Kazakhs have a choice. They can go to a state hospital or to a private medical clinic. Government supports state hospitals that charge very low prices while private medical clinics charge a market price for its services. Of course, patients receive a lower quality of care in the state hospitals than the private ones. I remember well my trip to a state hospital in Almaty, Kazakhstan. I walked through run down, dirty corridors. State hospital looked more like a factory than a hospital. A nurse yelled at me in Russian. Subsequently, I went to the private medical clinic around the corner from my apartment. Clinic was clean and new with friendly staff. I also received my medical services quickly. That was the thing. Kazakhstan grants its residents the choice which medical services they want. United States could copy this plan. U.S. government could dissolve Medicare and Medicaid and give the funding to the county governments to support state-funded hospitals. Then the government exits the health care business and allows private hospitals and medical clinics to provide services to paying customers. Then Americans can choose which health care system they want.

After examining the Affordable Care Act, I am shocked the President and Congress would offer such a terrible plan. At least the Congressmen did not exempt themselves from the healthcare law. I believe the law requires our Congressmen to enroll in health insurance similarly to everyone else, but the U.S. federal government pays up to 75% of the insurance premiums. In the old days, government passed a program to help people. Instead, the government had passed a program that will cause problems, but it does create two benefits. First, insurance companies cannot deny insurance to people with preexisting conditions. Second, the insurance premiums could be reasonable in the beginning. For example, I looked up the cheapest plan for my state, which was $200 per month. That was not bad, but this was an estimate and not a quote. However, the health insurance costs will continue rising from the following problems.

  • Health companies may hike premiums because they gain more market power. Government guarantees them consumers, and consumers can only choose insurance from 38 companies.
  • Health insurance companies must cover patients with pre-existing conditions. These patients may require more medical care, and the insurance company would pay these medical costs.
  • People may increase their demand for medical services because they have insurance. Consumers bid up prices for medical services (unless the supply also increases).
  • U.S. government has left some doctors and hospitals out of the health insurance plan. Consequently, government will reduce the supply of health care and drive up its prices.
  • Health care plan expands state and federal government bureaucracies, and the government gains and collects more information about its citizens. Furthermore, bureaucracies grow continually, and hospitals, medical clinics, and insurance companies would pay greater compliance costs as bureaucrats expand the rules and regulations.

Table 1. List of the Health Insurance Companies
Companies Companies Companies
AETNA AFLAC American Family Insurance
American Medical Security American National Insurance Company  Anthem Insurance
Assurant, Inc. Asuris Northwest Health BlueCross BlueShield Association
Celtic Insurance Company CIGNA College Health IPA
Connecticare Inc. Continental General Insurance Company Golden Rule Insurance Company
Group Health Cooperative Group Health Inc. Harvard Pilgrim Health Care
Health Markets HUMANA Insurance Services of America
Intermountain Healthcare Kaiser Permanente LifeWise Health Plan of Arizona
LifeWise Health Plan of Oregon LifeWise Health Plan of Washington Medica Minnesota
Medical Mutual Oregon Health Insurance Oxford Health Plans, Inc.
Principal Financial Group, Inc. Shelter Insurance Unicare Health Insurance
UnitedHealth Group Inc. Vista Health Plan Walter Jarvis Insurance Services
WellPoint WPS Health Insurance

Table 2. Penalties for not carrying health insurance

2014 2015 2016 and beyond
Adult $95 or 1% of your income $325 or 2% of your income $695 or 2.5% of your income
For every child $47.50 $162.50 $347.50
Family max. of $285 or 1% of family income max. of $975 or 2% of family income $2,085 or 2.5% of family income

Friday, October 4, 2013

The Underground Internet

I have always surfed the Internet since it took off in the early 1990s. I remember the days when the Internet comprised of text messages with no color pictures and graphics. I am even knowledgeable in computers and can write a little code in several languages, build basic websites, and other little stuff. However, I never even guessed a whole, hidden world existed in the Internet that most users would never see. They call it the deep Internet, or a better term is the underground or hidden Internet.

Before describing the hidden Internet, I define the standard Internet. For example, a user types the URL into the web address, such as Many things happen that a user never knows. His or her computer looks the IP address for the URL in the DNS database. IP address identifies the web server’s location within the Internet. It is a unique address similar to a mailbox where people send and receive letters. DNS database lists the world’s websites like an address book, including the user’s Internet provider. IP address comprises of four digits ranging from 0 to 255, and a period separates the digits. Subsequently, the user’s computer connects to Hotmail’s servers. User connects to the Internet with an IP address via his or her Internet provider. However, the user’s computer and Hotmail’s servers exchange IP addresses. As the user’s computer and Hotmail servers exchange information back and forth through routers. Routers read the destination and source IP addresses, so they can send the information to the right places. Consequently, a mailman knows where to deliver the mail. Every letter he delivers has a send and return address. As you probably guessed, law enforcement officers can trace IP addresses and track down users who use the Internet for illegal purposes. Once they know the IP address, they know where the server exists in the real world.

An organization, Tor, developed a unique browser that does not use IP addresses. Thus, users’ computers and websites do not use IP addresses as they exchange information. Then the computers can encrypt all data, so no one intercepting a communication can decrypt it or at least not easily. Consequently, a user can remain anonymous as he browses the Internet. Tor becomes the critical software for accessing the hidden Internet.

A user can download Tor for Windows, Apple, Linux, and Android operating systems. The hyperlink is Designers use a modified version of Firefox that serves as a browser. Then users can use the browser to surf the Internet like a standard browser such as Internet Explorer, Chrome, Firefox, and Opera. If users take precautions, then they can remain anonymous.

I surfed the Internet and checked my IP address. One minute, my IP address placed me in the Netherlands. Then later, I was in Los Angeles, California. Subsequently, my IP address switched to Germany, and so on. I did find this annoying. When I visited Yahoo, the Welcome Screen was in Dutch. After I had returned, it was in English and then German because Yahoo and some websites personalize webpages depending on the user’s country. They use the IP address to determine the user’s location and country.

I found the technology cool, although the Internet speed crept at a slow pace. I could be wrong in my interpretation, but the metaphor of the mailman still works here. How does a mailman know which house to deliver the mail if he has a letter with no send or return address? Communications bounce from router to router in cyberspace until it arrives at the correct router. As a router receives information, it only knows the previous router that sent the communication and the next router where it sends the communication. After a communication passes through several routers, the sender has no link to the receiver. Do you see the secrecy? How can a policeman or agent track down someone if he or she does not know who sent it, or who receives it?

This technology is legal, and users have legitimate reasons to use it. Some believe the U.S. Naval Research Laboratory sponsors this technology to allow the U.S. government to send communications secretly. Spies, military, law enforcement officers, and delegates can send communications secretly without terrorists and enemies intercepting messages. However, the Tor developers use this technology to defend against government surveillance. We know the NSA is eavesdropping on everyone’s communication. Journalists, activists, dissidents, and whistleblowers can use this technology to send secret information to others and have some protection from an autocratic government.

This technology is not foolproof. Government agents can use malware, hacks, and other techniques to reveal a user’s identity. For example, the FBI exploited a security hole in Firefox that copied malware onto a user’s computer. Malware read the user’s IP address and MAC address and relayed that information to the FBI headquarters in Virginia. IP address reveals the user’s location while the MAC address identifies the unique serial number of a computer’s network card. IP address leads the enforcement officers to a person’s location while the MAC identifies the user’s computer.

As you probably guessed, users can use this technology for illegal purposes. FBI arrested Ross William Ulbricht, the founder of Silk Road. He also uses the alias the Dread Pirate Roberts. Ross created a hidden website called Silk Road, where users and vendors bought and sold a variety of drugs. Ross Ulbricht earned commissions from the sales as buyers and vendors generated 60,000 hits per day. FBI claims he earned between $30 and $45 million in revenue annually, and the Department of Justice seized $3.6 million in Bitcoin – virtual money. Feds claimed Ross hired a hitman through the hidden Internet to murder both a blackmailer and witness. The URL for the Silk Road is:


If you type the URL into your browser, nothing will show. Your browser looks the URL up in the DNS database, searching for that IP address. However, this website does not exist in the DNS database, and your browser cannot connect to it. You would need to download the Tor browser and type the URL into that browser. Then the browser would connect to the Silk Road. Did you notice the word onion in the URL? Onion refers to the onion network, the hidden world of the Internet. When I typed the URL for Silk Road, I saw the message below:

I surfed this underworld to see what I could discover. I found a search engine, called Torch that indexes the hidden sites. When I clicked on the links, less than half the websites would display. I do not know if some vendors temporarily shut down their websites because the FBI seized Silk Road, or this technology is young and unreliable. For the real Internet, the DNS database organizes the Internet world, where the onion network is decentralized. Nevertheless, I became shocked at what several websites were selling. I could buy guns from Europe, marijuana from the Netherlands, buy counterfeit euros and U.S. dollars, order phony driver’s licenses and passports, or hire a hacker to create hell for my enemy. Then I saw another website where I could hire a hitman if the hacker could not create enough hell for my enemy. I listed the snapshots of these websites at the bottom of this blog. I could give you the website addresses, but they mean nothing in the real Internet world. Did you notice the currency? All vendors accept Bitcoin, but they send the products through regular mail or package delivery company.

Bitcoin constitutes virtual money or cryptocurrency. No central bank or government issues Bitcoins, and 11.75 million Bitcoins were circulating in the world in October 2013. Bitcoins’ supply continuously grows until 2140, stopping at 21 million Bitcoins. Cryptography plays a key role in Bitcoins. Every Bitcoin has a unique, encrypted number. A person opens an account or wallet and can buy Bitcoins from online vendors. A person can store his Bitcoins on his computer or cellphone or use an online wallet. Of course, a person does not show his identity. Then he or she can settle transactions by sending the other party his account information. As a buyer completes a transaction, software encrypts that person’s private key into the transaction along with the Bitcoin number. Ensuring people do not spend the same Bitcoin for multiple transactions a miner clears the transaction. Miner is not the proper terminology. It functions more as a bank or clearinghouse. A miner decrypts the transaction and records it in a ledger. Then it re-issues the Bitcoin to the seller.

Think of a Bitcoin where you send a check to the seller, and he deposits the check into his account. Once the bank receives the check, they change numbers in their ledger by deducting the check amount from the buyer’s account and adding it to the seller’s account. A miner can earn transaction fees and receives newly created Bitcoins by clearing transactions.

This sounds complicated, but do you remember the old days? Rich people could take a suitcase of cash to a Swiss bank and open an account. They get a numbered account that contains no personal information. Then they can use the account to settle transactions secretly. For example, a rich person pays a Congressman a bribe. Rich person contacts the Swiss bank and asks the bank to transfer the bribe amount from his bank account into the Congressman’s bank account. Rich person gives the banker a code (or private key for Bitcoin) to approve the transfer. Transaction remains secret because no one has revealed his or her identities. Consequently, Bitcoin brought the secrecy of banking to the regular people.

I did not think Bitcoins would succeed because the system has several flaws. First, people who deposit their savings into banks have deposit insurance. If their bank fails, FDIC guarantees the depositors will not lose their money up to $250,000. However, no government agency insures Bitcoin or protects people from losses. Second, hackers broke into online wallets and stole the Bitcoins. Since all transactions are electronic, they erased history. Third, the price of Bitcoin fluctuates greatly between $80 and $220. Refer to the chart below: For people to use and accept money, money must retain its value. Some people view Bitcoins as an investment, hoping to buy at a low price and sell for a high price. Finally, a limited number of sellers accept Bitcoins as payment. This was true until I had discovered the hidden world of the Internet, where Bitcoin has become the means of payments.

I became puzzled when the U.S. Department of Homeland Security shut down Mt Gox, the largest Bitcoin operator in the United States in May 2013. U.S. law requires all money exchangers to register with the Financial Crimes Enforcement Network. Feds even seized its bank accounts. I thought the U.S. government was petty because Mt Gox converted government-backed securities into Bitcoins and Mt Gox did not participate in illegal activities.

I thought Bitcoins had no future until I discovered how criminals can use two methods for Bitcoins. First, criminals can launder money using Bitcoins. For example, they buy Bitcoins in the United States utilizing money from illegal proceeds and spend or convert the Bitcoins in any country circumventing government controls on transferring money abroad. Russian government has banned Bitcoins for this reason. Second, criminals use Bitcoins on the hidden Internet. Feds believe that if they can shut down the money, they would kill the black markets operating in the hidden Internet. Feds have one severe problem. A person can use Bitcoins anywhere in the world. It sounds as if the U.S. government has started another war that it cannot win. (I find this amusing, but the sellers send the products through the mail or package delivery companies. I guess the U.S. government does not have enough agents to check all that mail).

I found this technology incredible as it opened a new world before my eyes. I became amazed after I had read the instructions to setup a hidden website. I could convert my laptop into a website server and use my Internet connection to allow users to connect to my website. (It appears most vendors pay a company to host their websites). Then I could submit my URL to Torch search engine so users could find me unless I did not want to be found. Instead, I could pass my URL by word of mouth if I were doing no good. Of course, I am not doing anything illegal, and I have no need for any of these products or services. So I have no real need for this technology unless the U.S. government starts banning books and restricting free speech of professors. Then I could use this technology.

Samples of websites I found after surfing the hidden Internet within fifteen minutes. I do not condone or recommend using these products and services.