But let’s carry this one step further…we’ve been discussing trash collection, but it could just as easily apply to airplane slots at an airport, converting corn acreage to ethanol, subsidizing mortgages, or pricing and rationing health care.
Sam, you’ve just proven in a few posts that a few bits of anecdotal evidence are absolutely not sufficient for sweeping conclusions and mandates about what is, or is not, most efficient.
I would bet that the debate on this thread for the last 3 pages is far more thinking than Henry Waxman’s congressional staffer put into bits of the 2,000 page cap-and-trade bill, or some other staffer put into the 2,000 page health-care bill.
And the latter stuff is now law. It’s rigid. It’s inflexible. If it’s wrong, it cannot be changed. If market conditions change, it won’t be able to change with it.
Suppose some garbage-collection bill had buried somewhere on page 1,378 that there must be one - and only one - garbage truck on route in Pleasantville, USA. Because some staffer somewhere thought that was a good idea to put into a bill that no one will read. And perhaps, because they were influenced along the way by the One-Truck-Per-Town lobby that thought it was a good idea.
An Unintended Consequence has just been created. Efficiencies have been lost. Customer service has been pre-ordained to deteriorate. And it’s all baked in concrete as law.
This is exactly what happens when the government takes over large swaths of the economy.
Those are all cool problems indeed, and each of them is a subset of a larger problem as well.
I am not really familiar with the law or the debate on it - been busy on other stuff. But isn’t it striking that in one sentence you say you agree that anecdotes are not sufficient to make sweeping conclusions, and then in the next you do exactly that?
Anyway, I am guessing that there is a lot of academic and civil servant research on any economic issue like that that can be pointed to, no?
But in the end on complex issues, there is no one right answer, and you have to proceed on incomplete information no matter how much you have. It is the nature of the world once you are past checkers and tic-tac-toe.
Why can’t laws or markets adapt again? This is the US we are talking about right? Laws can’t be changed?
But maybe you are jut talking about a subset of a bigger system? Which is partly what we are getting about with the trash trucks.
Neither Sam_Stone nor I have said anything to suggest that the OP is not correct in the conclusion, only that it is not supported from the data he has offered. Maybe one truck is best in his, or some other, situation. We just don’t know yet.
Is “customer service” what we are optimizing? I asked a bunch of times, I was hoping someone would eventually say. If so, how would you measure it without bias?
Uh, not fair to extract from local conditions, even if true, to global conditions where other parameters come into play.
Would you suggest for instance, that the US auctioning of wireless spectrum that is now our cell phones was anything less than ideal from the govt’s point of view, or the market’s point of view? That spectrum represents a large ans still growing swath of the economy as you say.
I’m impressed by the depth of a priori reasoning in this thread, free of any actual facts.
I admit that when I bought my house six years ago I thought that it was a pretty dumb thing to have disorganized trash pickup. But it isn’t. It’s cheaper, for whatever reason, than the alternative. In Minneapolis the residential charge is $19 a month http://www.ci.minneapolis.mn.us/solid-waste/billing.asp (I assume the $7 credit for recycling, and the $2 rental for the small cart). My monthly charge is $13. What’s the difference? I can shop around, they can’t across the river.
What I find interesting is that my neighbors have different ways of evaluating good trash pick up: is it a local business, do they pick up lawn waste, do they take large objects, etc. It just goes to show that trash pick up isn’t a simple commodity.
Here is a much more visual reference that I think will help:
Picture any generic mall food court, with 5 restaurants (McD’s, Taco Bell, there is usually a pizza place, and a Panda Express). The 5 of them each serve a portion of the 100 customers that visit. And as such, each individual restaurant is set up and designed to serve that portion, and does it well. They each individually have the right number of cash registers, right number of fryers, right quantity of condiments.
They are all chains, and all very good at being able to set up in a new mall, adjusting to size constraints, and different volumes of customers.
Now, consider a new mall opens that decides to have the same food court, but with just one restaurant to serve the same 100 customers.
What would you expect the set up to look like? I know you could demand millions of variables before you can answer, but this is a back of the napkin type calculation.
Would you, an educated individual, expect to see one large version of McDonald’s set up to deal with 100 customers. Or would you expect to see 5 individual McDonald’s.
I personally see this as rather straight forward because I have been in both very small and very large McDonald’s. The size of the restaurant varies based on the number of customers they expect to serve.
I think that we, as reasonable individuals, can see a level of inefficiency to have a massive restaurant that only serves a trickle of customers. And likewise, we can see the lost revenue if a restaurant is too small to deal with regular and predictable busloads of tourists.
Even without knowing all of the millions of possible externalities, we can pretty safely say that McDonald’s is unlikely to build 5 small restaurants each with their own manager, instead of 1 larger one.
So to recap: each individual small restaurant is going to be as good as it can be given it’s constraints. But if given the option, it’s unlikely that a restaurant would choose to build 5 small versions instead of one large one.
Is there a reason why you wont even try to begin to construct an actual mode3l of the problem in the OP in order to analyze, you know, the problem in the OP?
I pay $38.96 every 2 months, for a bin slightly larger than your small bin, but not as large as your large bin.
Then I pay an optional $79.50 seasonal fee for yard waste. There was an on-call option of paying a $2 per bag fee if I didn’t want the whole season, but that had a 12 bag minimum for them to pick it up. They give me a bin for the seasonal package, but I have to pay for the bags if I use the on-call system.
Then recycling is paid for through property taxes, but at the moment I can’t find that bill. Oh weird, I just found it online. We pay $40 a year for recycling.
Why apples and oranges? We know nothing about the cost structure of either business, nor do we know anything about the demand side or the access to resources or alternates/replacement options in either place. So we can’t really make a guess on which side is optimized. Maybe one, maybe the other, maybe neither, maybe both. They are independent of each other almost certainly, less so if the same trash companies serve both places, but even then the interactions between two distant locations are small and possibly negligible.
What do residents pay in neighboring municipalities that have city-organized trash pick up?
My point was to compare two neighboring cities, one that has city-organized trash pickup, and one that has disorganized. Other than that, they are fairly similar. Trash pick up costs less in the latter city.
It’s not great evidence, I’ll admit, but I think that it’s more to the point than talking about newspaper deliveries and food courts.
You know what would be really central to the issue would be some actual facts, as opposed to your anecdotes about how many garbage trucks you claim to see rolling around.
ETA: I’m not asking for a detailed comparison of two systems. I’m pointing to the very obvious redundancies of having 5 small companies vs 1. Five websites, 5 offices, 5 parking lots, 5 pay roll clerks.
If there was just one larger serving the entire area, they would only have 1 of those things. Like I said, if two of them merged, they would eliminate the obvious redundancies.
I feel this is correct, because like with the food court, none of the 5 break themselves in half to have 2 smaller restaurants. They pick the size that is right for the number of customers.
Or maybe it’s counter intuitive, and having two of everything will create internal competition, so each employee will work harder. Or maybe it’s like when Best Buy bought Futureshop so they could pretend people have choice.
To give you a better sense of what I’m talking about, and why we don’t need the level of detail some have requested, consider these two examples from the restaurant industry that I mentioned above:
A few years ago Tim Horten’s (a Canadian coffee/doughnut chain) and Wendy’s merged. Now, in this case, each product was different enough that it didn’t just become Wenhorten’s Coffee and Old Fashioned Burgers. Each company maintained it’s brand image. But after the merger, they began to build duel-restaurants that were about the size of either previous restaurant, but now had two small kitchens each offering their respective products.
There were efficiencies to be gained by eliminating the need for two separate and individual restaurants. The merger found overlaps that they could eliminate, and kept the individual parts that they needed.
Tacobell and KFC did something similar as well. They realized there is no point going through the trouble of building so separate and individual restaurants at a given location. So they built combined ones–eliminating the unnecessary overlap. Inside they had a common seating area, merged the ordering, split the kitchen in half to have two lines, and used common fridge/freezer space.
I did, several times, **Sage Rat **even made some pictures. The concept seemed far too complicated, leading some people to demand more information than required. As if it was some how more than garbage collection. A couple of people got so bogged down in the minutia that they couldn’t understand what was actually going on. I figured a more visual reference would help. We’re all familiar with mall food courts, but we are not all as familiar with trash removal.
So in a mall food court, you’ll see 5 restaurants, 1 of which is a McDonalds. You won’t see 2 mini twinned McDonalds, the franchise will put in the proper sized restaurant for that location, preventing redundancies. If given the opportunity to be the only restaurant, they would put in one proper sized larger restaurant–eliminating redundancy.
Right now there are 5 companies providing a service to a fixed group of customers.
My premise is that the service they provide isn’t differentiated enough to warrant 5 overlapping companies. If someone else’s truck took my trash next week I wouldn’t notice. All I would see is that the garbage is gone. It’s not like ordering Dominos and Coke but getting Papa John’s and Pepsi. It’s more like ordering electricity and natural gas from Xcel, but getting it from Ontario Hydro and Center Point.
And as a result, I see redundancies in the system. Because there are 5 individual companies, there are 5 of everything. I highlighted the trucks, but they also have five offices, and five secretaries, etc. Five of everything doing the same thing, all to a minimally acceptable standard that involves [garbage picked up yes/no].
Have you read the actual theread? Already mentioned several times:
1 - Descriptions of the trucks
2 - descriptions of the road network
3 - descriptions of the distribution of trash
4 - description of the dumping site
5 - description of the labor market and other costs
6 - description of the capital structure of the trucking companies
7 - description of related (nearby markets) if any
I’d say at least an attempt at those 7 things would be a good start. Surely, having been observing the trash pickup in your new town for 7 months at least, you should have no trouble giving us a pretty good first swag at the first 3 with little effort.
I don’t think anyone will beat you up if you try to give this info in good faith as best you can. No one expects a perfect model or even a sense of what the parmaeters are to drop out in the very first pass.
But any effort at describing the actual problem, and your observations, is more valuable than a long string of only tangentially related analogies.
Instead of going into detail abotu food court restaurants or whatever in an attempt to persuade us about trash pickups, an entirely different industry and market with a different industry structure, why not invest your effort in details about, you know, the matter, in the OP?
And please for the love of the Flying Spaghetti Monster, can you please tell us what precisely it is that you think is not optimal in your trash pickup system and why that of all possible functions to optimize is the one that matters most?
I saw those pictures, they are not a model. They simply showed that on one stretch of a trucks route it might make pickups boustrophedonically or not.
There is no objective funtion to be optimized, so there is no model.
I suspect you are partly concerned with what is called in the literature a “traveling salesman problem” . I pointed you to a peephole at wikipedia so you can begin to understand how complex that simply stated problem really is. It is among the well know class of problems that are conjectured to not be solvable in general terms other than by what are essentially grossly inefficient brute force algorithms.
If you are standing alone in saying that this is not so, in essence saying “I have the answer, but the margins are too narrow to write it down”, well, the last time someone said that, it took hundreds of years to solve the conjecture and the solution was not going to fit in any margins, so pardon us if we are skeptical of your claims how trivial a problem this is.
Meantime, I recall that when I asked you for a model, you wanted to get into a dick waving contest. Are those diagrams really your idea of a model? Because if so, let me clarify what I meant before you reached for your crotch: A series of equations that describe the process and its constraints relative to process-specific parameters, and one or more parameter-based functions meant to describe what is sought to be optimized subject to the constraints.
If we construct that, and it is generally an iterative process, no one is going to plop it right out of their head complete on the first pass, then we can actually perform experiments by (methods depending on the structure of the model) calculating the optimum and doing a sensitivity analysis (i.e. seeing how much the answers might change relative to variations in the initial assumptions of the model’s parameters.
When I talk about models, that is what I mean. When you swung out your dick suggesting you were quite experienced with modeling processes and how dare I suggest otherwise, I gave you the benefit of the doubt.
I still do, but for the benefit of other readers who are following along, I want to clarify what I meant, and what Sam Stone is alluding too also, and let them decide for themselves if what you have provides is in any way shape or form a “model”.
So you are suggesting that these companies, who are hustling for a buck in a competitive atmosphere, and at the same time creating 5 times as many jobs for local people, are causing the price of pickup to be too high in the marketplace? Is that what you are concerned about?
because I wonder, since you said you were new in town, how did it come to be this way in your area? Was there a single pickup before at some time? What caused the city to change strategies? There is likely someone at City Hall responsible for monitoring all this, have you bothered to ask that person what the comparison is between then and now?
Give me some time, I’ll put together the answers to your 7 questions, but first:
You keep bringing up the traveling salesman, which shows what you’re doing wrong in this problem. That optimization is about finding an absolute maximum/minimum and I agree is complex. If that was the task at hand, we would need a lot of data. But that’s not what we’re trying to do, and you know that.
You are focusing too tightly on finding that absolute best path, when what I’m talking about is eliminating the more obvious failures. If we simply pick a path for the salesman at random (F - C - B) we will get a value say X. If we pick a second path completely at random, we will get a path Y. You now have two data points and can choose one over the other. Neither is a maximum or minimum, but if they represented cost, we could choose the cheaper. If they represented profit we could choose the larger. We don’t actually need the absolute maximum or minimum.
If you want to stick with TSP, that involves 1 salesman. My situation involves sending 5 together all at the same time on the same trip. Redundancy. When companies merge, they eliminate redundancy.
I let it go the last time you said it, but this time I call bullshit. That’s a variation on broken window fallacy. “We should all be happy that more jobs are created, even though more jobs weren’t needed.” We wouldn’t be happy if the government had make work projects involving 5 guys driving around, it’s wasted resources. The extra jobs you keep describing are paid for from my bill, which means that money doesn’t go towards other things. Those extra jobs are redundant, which is a waste of resources. Let me have my money, so I can pay them to do something else. Free market right?
No, I most certainly do not know that. Please don’t speak for me.
I have been clear that since yoru OP, you have not yet defined what you meant by “inefficiency” or other terms of art related to business process and economics.
The reason I mentinoed the TS Propblem is because you seemd to have indicated in your opinion that the route the trucks take is “inefficient” somehow and that calculating efficient routes is not complex. I merely pointed out to you that not only is it complex indeed, it is the very embodiment of one of the great unanswered conjectures in the mathematics of computer science.
I did that with the hope that it might nudge you off your insistence that the OP is not describing a complex problem, or failing that, to alert the readers that there is a rational basis for my claim that it is.
You are backtracking. You have defined a situation as “inefficient” despite being asked many times to explain precisely the measure you use, and why it is significant.
Now it iappears that if you saw a one truck company with a truck that went around the block to double check on something one time, you would cry it is inefficient. Maybe it is in a sense, but is it significant?
Unless you define your terms, you are just punching at air. That is why I keep asking you to define your terms, to describe in detail the process and system that concerns you, and then maybe we can go through a pass or two of integrating that into a model so you see how that works.
There is extensive literature on any variation you can think of, I am sure. Perhaps your local library or search engine can assist you before you make such silly statements again.
If you would stop and try to build a model instead of shucking and jiving you would see how silly and self serving that is.
You missed the part right around the part where you quoted where I suggested that you tell us if your prices are in fact lower than they were under a previous regime of one truck.
We are about 3 pages into this now and you still don’t realize that it is at all possible that savings from modern trucks, reduced manpower on the trucks, reduced maintenance expenses, etc. could more than make up in savings what it costs to hire a $10/hr office clerk or whatever? Really?
Before you go any further, can you answer one thing?
When you said you have experience building models, what exactly did you mean? What types of models?
I think I am in agreement with Sam Stone in general on this. There is nothing other than “five trucks” to indicate that this is inefficent compared to a city run (or contracted monopoly) garbage disposal service.
But lets back up here a second, pesumably a city run service could “mimic” the curent system, if it were efficient, and have five trucks. Since there is no city run service we have no way of comparing. So we are operating on a hypothetical versus a n actual. We can work with that. The hypothetical on the one side seems to be that there shouldonly be one truck and there are some efficeincies to be gained by in essense consolidating the routes. Poi thtat htis is the case the question is then, “Why isn’t this happening in the marketplace?” Competing companies could still work out where they subcontract out garbage delivery and increase their efficeincies as long as they are not colluding on price or on service. It is just a matter of whose truck is used.
But apparently we don’t see that which would indicate a couple of things: 1) There are no efficeincies to be gained; or 2) there are barriers to being able to achieve higher efficeincy. The latter may be the transaction costs may be prohibitive or there may actually be some legal restriction that we don’t know about.
Of course a third possibility is this, the five companies are not offering the same service and therefore it is not interchangeable. emack discussed the different services available, and while some of it seemed nonsensical, it still indicated there was some differntiation of service, which tends to have value.
So primarily, my guess is that efficeincy may be abble to be gained if there is some sort of mandated (eithr by the government or the market) uniformity in service. Since this has not happened, does not mean there is not inefficiency, but it does point out that the mere fact there are five trucks is not de facto evidence of inefficeincy, either.
Why would a mandated market be “efficient”? At best it would be a local optima of of sort, but how would you know where it is, and how would upi manage the market as an overseer to make sure it gets there and stays there?
The whole point of a market based system is you don’t have to know or do any of that - the incentives inherent in the system itself drive the market operation towards at least a local optimum, and not only that, as conditions change, the incentives change, and so the overall market will adapt to the changed conditions and find the new optima.
The flip side of that is, if you propose to do the same thing by some sort of central management or mandate, etc., then you have to make a really good case as to how you can do it at all, let alone do it well.
Now, there are few if any “pure” markets, so this is not for every situation. Most places you get some sort of hybrid, as is probably the case in the OP.
BYW, my area is not big enough to have multiple trash haulers (I think), but I thought a bit more about the possibility of auctioning 5 routes out and at first glance, it seems like it could be a very good way to go for City Hall (if the businesses are on the up and up, which seems like a fair question to ask in the trash industry).