tor

Tax Hamster Wheel

112 posts in this topic

This is actually the thing I find most amusing about the proponents of land tax. They tend to be the people that are going to have to pay more tax. If one of them said "I think the current system is unfair because you, tor, are paying too much tax and the rest of us would rather pick up the load for you" it would at least show they have thought through the basics of the deal. I doubt they would get much support at that point. Simply because I reckon that when the math is done there are more people on X multiples of average tax than there are people with the same X multiples of real estate.

The point of land tax is that it encourages production over speculation. The idea is that everyone who produces more than they consume in land is better off. Everyone who speculates on land more than they produce is worse off, so has to actually do something productive to make a living. This means more people producing (and those already producing are encouraged to produce more), which is beneficial to everyone, except those who did not produce before.

And don't forget the fact that we are importing funds from overseas to Australia just to pay for land speculation. Higher land tax would curb land speculation so we wouldn't need to borrow this amount from overseas.

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Its Eurosocialism, take a bucket of water from the shallow end of the pool walk to the other end and throw it in the deep end and proclaim that the water level is rising in the deep end whilst jounos photograph and record your musings during the symbolic pour.

Common thoughts amongst folk in the deep end who can't be arsed doing what it takes to get to the shallow end. Views that get more popular based on the public profile of a minority few basking in the shallows that got there through good genes, luck, guile, lies or cheating. Views that totally ignore those that got there through risk, hard work or are rewarded for demanding and/or critical duties in the pool.

Funnily enough, Bill Gates' dad, a prominent Washington lawyer (and I think he stumped up the cash that let Bill buy DOS from the guy who actually wrote it, and then flipped it to IBM on a per copy basis), wrote a book not long ago critiquing that very view, arguing that property laws protect accumulators too much.

Edited by Sean

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Have you read Aesop's fable of the ant and grasshopper?

I have and must confess you lost me with the reference. How do you see the connection?

I have one interpretation but it could come across as mean so I will let you go first :)

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From a last life:

CLASSIC VERSION:

The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks he's a fool, and laughs and dances and plays the summer away. Come winter, the ant is warm and well fed. The shivering grasshopper has no food or shelter, so he dies out in the cold.

THE CANADIAN MODERN VERSION:

The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks he's a fool and laughs, dances and plays the summer away. Come winter, the ant is warm and well fed.

The shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while others less fortunate like him are cold and starving.

CBC shows up to provide live coverage of the shivering grasshopper, with cuts to a video of the ant in his comfortable warm home with a table filled with food.

Canadians are stunned that in a country of such wealth, this poor grasshopper is allowed to suffer while others have plenty. The NDP, the CAW and the Coalition Against Poverty demonstrate in front of the ant's house. The CBC, interrupting an Inuit cultural festival special from Nunavut with breaking news, broadcasts them singing, "We Shall Overcome."

Exiled Svend Robinson rants in an interview with Pamela Wallin that the ant has gotten rich off the backs of grasshoppers, and calls for an immediate tax hike on the ant to make him pay his "fair share." In response to polls, the Liberal Government drafts the Economic Equity and Grasshopper Anti-Discrimination Act, retroactive to the beginning of the summer.

The ant's taxes are reassessed and he is also fined for failing to hire grasshoppers as helpers. Without enough money to pay both the fine and his newly imposed retroactive taxes, his home is confiscated by the government. The ant moves to the U.S. and starts a successful agribiz company.

The CBC later shows the now fat grasshopper finishing up the last of the ant's food though Spring is still months away, while the Government house he is in (which just happens to be the ant's old house) crumbles around him because he hadn't maintained it.

Inadequate government funding is blamed, and Roy Romanow is appointed to head a commission of enquiry that will cost $10,000,000. The grasshopper is soon dead of a drug overdose, and the Toronto Star blames it on obvious failure of government to address the root causes of despair arising from social inequity.

The abandoned house is taken over by a gang of immigrant spiders who are praised by the government for enriching Canada's multicultural diversity. The spiders promptly terrorize the community.

THE AMERICAN MODERN VERSION:

The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter. The grasshopper thinks he's a fool, and laughs and dances and plays the summer away. Come winter, the shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while others less fortunate are cold and starving.

CBS, NBC and ABC show up to provide pictures of the shivering grasshopper next to a video of the ant in his comfortable home with a table filled with food.

America is stunned by the sharp contrast. How can this be, that in a country of such wealth, this poor grasshopper is allowed to suffer so?

Kermit, the Frog, appears on Oprah with the grasshopper, and everybody cries when they sing "It's Not Easy Being Green."

Jesse Jackson stages a demonstration in front of the ant's house, where the news stations film the group singing "We Shall Overcome."

Al Gore exclaims in an interview with Peter Jennings that the ant has gotten rich off the back of the grasshopper, and calls for an immediate tax hike on the ant to make him pay his "fair share".

Finally, the EEOC drafts the Economic Equity and Anti-Grasshopper Act, retroactive to the beginning of the summer.

The ant is fined for failing to hire a proportionate number of green bugs and, having nothing left to pay his retroactive taxes, his home is confiscated by the government.

Hillary Clinton gets her old law firm to represent the grasshopper in a defamation suit against the ant, and the case is tried before a panel of federal judges that Bill Clinton appointed from a list of single-parent welfare recipients. The ant loses the case.

The story ends as we see the grasshopper finishing up the last bits of the ant's food while the government house he is in, which just happens to be the ant's old house, crumbles around him because he doesn't maintain it.

The ant has disappeared in the snow.

The grasshopper is found dead in a drug related incident and the house, now abandoned, is taken over by a gang of spiders who terrorize the once-peaceful neighborhood.

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I cannot see how taxing land based on its value is anything like taxing income. Income is derived from work. Taxing land is really the landowner paying for his share of the surrounding infrastructure. As more infrastructure is built and the value of the land increases, is it not fair the landowner pays for the extra rent received or the extra value wrapped up in this land?

Why should the infrastructure be given for free to the ant? The ant with the largest land holdings with the least improvements has the most to gain? An ant who wants to capitalise on the land and build multiple houses or commercial premises or industrial factories does not mind the land tax as it will be only a small portion of the income generated, and as a result of the tax the lands purchase price is less and he who does the most with the land wins rather than he who has the most land.

It would seem to me the ant is claiming an entitlement to something just because it has always been so. I am sure the ant in the storey built his own tunnel etc the government did not build this for him with his dwelling at the real estate at the end of the tunnel being his. If the governmetn built say the tunnel why should it not charge rent on this tunnel?

You can give me examples of some people who pay enough tax to cover this sure, but how is moving to a user pays system going to be more unfair than the present system? Just because it has always been a government pays and landowner receives situation to date why is changing that to user pays unfair?

It would seem to me to be a perceived entitlement on the ants behalf to something which is not his? Very different to the income generated from work done.

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A 2% land tax on some residential property would cause a massive crash. Commercial already has a land tax on it anyway so no effect at all there it will purely be in residential where for some reason the government has said infrastructure to resi should be paid in general revenue rather than by those who benefit from it. The system already works on commercial real estate and its not like the rich don't own any of that? They certainly have not left it in droves anyway.

Edit: I should add a 2% land tax in resi would cause a massive crash, I suppose that is why Henry suggests a 1% land tax at first, no doubt to be ramped up to 2% down the line to bring it into line with the land tax people pay if they own millions in property.

You're barking up the wrong tree Tom. At best the only thing you can tax is the earning capacity of the property. You'd have to figure out the assigned rental and tax that.

Because while governments print money from thin air the face value is misleading.

A 2% tax would be more than $10,000 on the median house. The median income is in reality only 50k per year for all workers.

So you've already instituted at least a 20% annual tax on the income of the single family income, let alone all the other taxes they pay.

Did you work this one out?

Face facts, Henry George conceived of a tax system that belonged in the middle ages when land was the major source of wealth. He was too stiff to notice that capital had become the new wealth long before.

You can only tax that which earns an income, otherwise you'll send the world back into the dark ages. The Roman Empire found that out when it was too late. Small land owning farmers were simply taxed out of existence. They either went Robin Hood or sold themselves into the serfdom of rich magnates that had the clout to escape tax.

The Visigoth army that surrounded Rome in the last days was actually half Roman Robin Hoods. 10,000 of the Roman army deserted to join the Visisgoths in assaulting Rome itself.

They got rid of Rome because nobody could afford its taxes.

Edited by wulfgar

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I cannot see how taxing land based on its value is anything like taxing income. Income is derived from work. Taxing land is really the landowner paying for his share of the surrounding infrastructure. As more infrastructure is built and the value of the land increases, is it not fair the landowner pays for the extra rent received or the extra value wrapped up in this land?

Why should the infrastructure be given for free to the ant? The ant with the largest land holdings with the least improvements has the most to gain? An ant who wants to capitalise on the land and build multiple houses or commercial premises or industrial factories does not mind the land tax as it will be only a small portion of the income generated, and as a result of the tax the lands purchase price is less and he who does the most with the land wins rather than he who has the most land.

It would seem to me the ant is claiming an entitlement to something just because it has always been so. I am sure the ant in the storey built his own tunnel etc the government did not build this for him with his dwelling at the real estate at the end of the tunnel being his. If the governmetn built say the tunnel why should it not charge rent on this tunnel?

You can give me examples of some people who pay enough tax to cover this sure, but how is moving to a user pays system going to be more unfair than the present system? Just because it has always been a government pays and landowner receives situation to date why is changing that to user pays unfair?

It would seem to me to be a perceived entitlement on the ants behalf to something which is not his? Very different to the income generated from work done.

So there would be a different tax for land that has new infrastructure built around it as opposed to land where the existing infrastructure is just maintained and even less if the infrastructure was allowed to slowly fall apart?

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So there would be a different tax for land that has new infrastructure built around it as opposed to land where the existing infrastructure is just maintained and even less if the infrastructure was allowed to slowly fall apart?

tor, lands value already relates back to its proximity to commercial and industrial land as well as the infrastructure built around it. If the infrastructure is falling apart the value drops.

This is why it has to be on the value of the land.

I agree there will be some land unfairly penalised like water views and the like. It is not perfect but having people pay for that which is not theirs makes more sense than saying to some people you must pay for the surrounding infrastructure but to others you do not have to. This is the current situation in most of our states. Commercial and Industrial pays as well as people with large holdings of residential land. PPOR's and mum and dad (i.e. small time) investors are exempt or pay very little.

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You're barking up the wrong tree Tom. At best the only thing you can tax is the earning capacity of the property. You'd have to figure out the assigned rental and tax that.

Because while governments print money from thin air the face value is misleading.

A 2% tax would be more than $10,000 on the median house. The median income is in reality only 50k per year for all workers.

So you've already instituted at least a 20% annual tax on the income of the single family income, let alone all the other taxes they pay.

Did you work this one out?

Face facts, Henry George conceived of a tax system that belonged in the middle ages when land was the major source of wealth. He was too stiff to notice that capital had become the new wealth long before.

You can only tax that which earns an income, otherwise you'll send the world back into the dark ages. The Roman Empire found that out when it was too late. Small land owning farmers were simply taxed out of existence. They either went Robin Hood or sold themselves into the serfdom of rich magnates that had the clout to escape tax.

The Visigoth army that surrounded Rome in the last days was actually half Roman Robin Hoods. 10,000 of the Roman army deserted to join the Visisgoths in assaulting Rome itself.

They got rid of Rome because nobody could afford its taxes.

Thats why the values drop in response. Already people who own multiple residential pay the land tax.

The median home value may be $500,000.00 the median land value about half that, or $250,000.00 so the annual tax is $5,000.00 on the median home. If you own 50acres at Glebe and live in a mansion their then you pay no land tax at all on your multi million dollars of land with light rail and the city on your doorstep. Land which would be more efficiently used as commercial, or industrial. Now if a person wants to keep this land, sure they should but should they not pay for this?

The NSW state gov is talking about compulsorily acquiring land to build on in our cities, far better in my opinion there is a market based solution one which places a cost on holding land.

The distinction between taxing land only and improvements is important, because if you tax improvements it does not drive capitalisation and efficient land use. What good is it to build 100 units on your block if your land tax goes up. The idea is expensive land should be capitalised appropriately for its location and access. If it is capitalised appropriately than the land tax should only be a small component of income. We want urban consolidation to increase the productivity of our cities, this is how you achieve it without government compulsory acquisitions.

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I wonder if I can do a part time 3 on 5 off, live in NZ and fly into Sydney (claim the deduction plus condo/Plonk's/Tor's place), push some tin for 3 and pick up $2500 tax free for three days and bugger off again?

PS. Sydney Tin's are on 100 an hour easy. I'm on a sh*tty 73, wonder what those Kiwi (well Aussies living in NZ) doctors are charging?

EDIT: Pissed ramblings

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I saw this on the 7:30 report last night.

I am not sure this is because of our tax regime? How is a land tax going to effect a professional on good coin? It should be better for him unless he is a hobby farmer which I guess many are? If anything he should be better off?

I think the issue for doctors is that training places are too limited and once they are trained in the big smoke they would rather chase coin as a specialist rather than move to the regions on less coin. I think this was said last night on the report.

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I think the issue for doctors is that training places are too limited and once they are trained in the big smoke they would rather chase coin as a specialist rather than move to the regions on less coin. I think this was said last night on the report.

I was in Perth recently and was amazed that some UWA docs (I was drinking with them) that applied for jobs South (Albany and Bunbury) couldn't get jobs because of budgets so off east for one and England for another.

Edited by Bernard L. Madoff

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I will tell you straight up there are moves afoot to replace enroute ATCs with software sytems and lesse paid data bitches.

Why are they failing in this endevour enroute? The same reason there is no bloody way a machine can do what I do and has my experience database in the Terminal (30 miles of an airport arriving and departing traffic). You can't replicate airborne failure (human, system, or machine); and you can't replicate weather when weather radars are still D grade and we are still using human assessment airborne.

Edited by Bernard L. Madoff

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I was in Perth recently and was amazed that some UWA docs (I was drinking with them) that applied for jobs South (Albany and Bunbury) couldn't get jobs because of budgets so off east for one and England for another.

What were these recent graduates or what?

If they were that is precisely the point the training hospitals do not have enough training positions. That is exactly what I said. If they were trained up qualified doctors than what is your point we have a shortage of them cause we tax them too much and we have to pay locums $300.00 per hour or we have unemployed doctors leaving in droves for jobs elsewhere?

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I will tell you straight up there are moves afoot to replace enroute ATCs with software sytems and lesse paid data bitches.

Why are they failing in this endevour enroute? The same reason there is no bloody way a machine can do what I do and has my experience database in the Terminal (30 miles of an airport arriving and departing traffic). You can't replicate airborne failure (human, system, or machine); and you can't replicate weather when weather radars are still D grade and we are still using human assessment airborne.

You would have thought that is dangerous?

Anyway in my experience there are more engineers required per worker hour now than ever. It is like once we got computers and design software we actually raised the bar on the amount of paperwork we had to do to compensate for it.

You now have more people than ever. It would seem to me computers have actually increased the workload! I suppose in fairness on the flip side we are able to analyse things far more accurately with finite element design as opposed to approximation methods but still I wonder if this really saves us overall?

It's either that or the entire construction industry needs tor to come in and show us how to streamline our systems, processes and procedures!

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You would have thought that is dangerous?

Let me tell you about a common scenario:

Me: "Wantoff 123 there is some weather on the localiser that appears fine abut tower advises lighning, I'd suggest maybe..."

Wantoff123: "Yeah it look nasty on mine we might do the as you suggest...."

Other234: "with you on descent to 7000, with alpha, we just heard your chat we'll take the ....as well"

Humans are INTRINSIC to flight safety. I don't give a flying f*ck about Australian industry waffle when Mr Poo and Mr Fan are close and YOUR mum, child or wife is aboard.

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Let me tell you about a common scenario:

Me: "Wantoff 123 there is some weather on the localiser that appears fine abut tower advises lighning, I'd suggest maybe..."

Wantoff123: "Yeah it look nasty on mine we might do the as you suggest...."

Other234: "with you on descent to 7000, with alpha, we just heard your chat we'll take the ....as well"

Humans are INTRINSIC to flight safety. I don't give a flying f*ck about Australian industry waffle when Mr Poo and Mr Fan are close and YOUR mum, child or wife is aboard.

Ill give you a far less important example of removing the human element but what can go wrong!

We have a roller shutter on our door here at work.

For years we had one that you had to hold the button to get the door to lower. Never had an incident it just got old and jumped out of the guides too often.

We recently replaced this shutter for one you just press the button and walk away!

This would seem only a small change but since doing this we have had the door clash with shovel handles which knocked the thing around a bit, bind up as it comes down and turn into a tangled pile of sh*t etc.

I have asked the door people to change it to a hold the button arrangement to force my staff to observe it as it travels down and they could not believe it and thought I was a lunatic!

Anyway the old door was 30years old and was giving up the ghost, the new one about 12months and is now on its last legs and skips out of the guides randomly now which does not help especially that it just keeps forcing the stupid thing down while no prick is watching it and is instead in their car driving away!

On tax, yeh sure you tax income earners too much and they go away. On land tax you tax them too much and speculators go away leaving developers to buy the land and actually use it for development into a suitable end use that it commensurate with the lands location and amenity.

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I will tell you straight up there are moves afoot to replace enroute ATCs with software sytems and lesse paid data bitches...

I will tell you straight up that I have tried to write one of these systems a few times now. Mine have not been for anything serious, no one in their right mind would let me do that on the budgets I have tried doing it.

I have come close though. Mine have mostly been for helpdesk scenarios and one for network troubleshooting.

It is a surprisingly hard problem to solve and I doubt that anyone with half a brain thinks it replaces people completely.

Mine have been mostly about getting newbies up to the quality of a couple years experience (which in helpdesk can be considered about as good as anyone gets as they then go get real jobs).

You have said that tins are getting few on the ground and about to hit a staffing crisis. Sounds like throwing some cash at a "knowledge base", "advisory system" or whatever fancy name is used by the consultants is not a bad idea as it will probably only cost 10 man years salary or so and if it comes off will bring newbies up to speed much faster. Probably cost about the same or less as a reasonable recruitment campaign.

I would love to get another crack at one of them. I reckon I won't though because most consultants say their system will do everything and so it will be destined for failure.

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I will tell you straight up that I have tried to write one of these systems a few times now. Mine have not been for anything serious, no one in their right mind would let me do that on the budgets I have tried doing it.

I have come close though. Mine have mostly been for helpdesk scenarios and one for network troubleshooting.

It is a surprisingly hard problem to solve and I doubt that anyone with half a brain thinks it replaces people completely.

Mine have been mostly about getting newbies up to the quality of a couple years experience (which in helpdesk can be considered about as good as anyone gets as they then go get real jobs).

You have said that tins are getting few on the ground and about to hit a staffing crisis. Sounds like throwing some cash at a "knowledge base", "advisory system" or whatever fancy name is used by the consultants is not a bad idea as it will probably only cost 10 man years salary or so and if it comes off will bring newbies up to speed much faster. Probably cost about the same or less as a reasonable recruitment campaign.

I would love to get another crack at one of them. I reckon I won't though because most consultants say their system will do everything and so it will be destined for failure.

I can enroute. Jet cruusing at FL350 is FL370 available? System says yes.

When you are descending to zero (000) to the airport with 7 others all technically converging albeit 2 minutes apart in the end (coz I'm the man) the system doesn't like it, now add 7 departures (land one depart one land one etc) and now the system isn't happy because there is a dickhead like me making this happen. Now...plonk an awesome thunderstorm in where every jet is off track avoiding (flying at each other because that the 'hole')...

I can't see a system fix.

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I can enroute. Jet cruusing at FL350 is FL370 available? System says yes.

When you are descending to zero (000) to the airport with 7 others all technically converging albeit 2 minutes apart in the end (coz I'm the man) the system doesn't like it, now add 7 departures (land one depart one land one etc) and now the system isn't happy because there is a dickhead like me making this happen. Now...plonk an awesome thunderstorm in where every jet is off track avoiding (flying at each other because that the 'hole')...

I can't see a system fix.

Oh anyone can write a simplistic system like the first one you posit.

The hard thing is writing the second one so it is usable. Can be done of course, just a matter of finding the right way of doing it and the budget to do it.

My current thinking is that the system takes input from all systems (for example your thunderstorm) and refers back to similar situations of what the ATC did. If what the ATC is choosing to do deviates from history it queries the ATC and then if you affirm it raises it with a peer for confirmation.

Then, later it asks for the piece of input which meant a different choice was made (this is actually the really hard bit) and in future uses that as part of the sanity check.

The problem is that to build a system like that you need to bring it up in a situation where time is not such a constraint (I am sure that landing a bunch of big arse planes in a stress situation you don't want to waste time peer reviewing your colleagues). In a non stress situation of course the system doesn't get to learn how to react in a stress situation. So you need to replay the live situation back into the system afterwards and peer review at that time tends, due to human nature, to be completely different.

An example would be if you, in a high stress situation, do something which might not be optimal but still works your colleagues will trust you based on experience not to do something stupid and crash the lot. In a non stress situation human nature tends towards either blanket agreement with your actions or annoying nitpicking over optimal solutions.

Then of course the actual translation of the different systems input has to be done in a way that if one system sh*ts and burns the others treat that correctly, that would be an interesting problem actually. Planes cost too much to keep in the air to be uber safe but crashing one costs too much to not be. hehehe. Cool arse problem actually. Probably solve most of them with heartbeats I guess.

Writing the rule set would be interesting but I doubt it would be technically challenging. Been done for other stuff.

The real problem is that if the system does actually work and so the recruitment drive of ATC doesn't happen then the industry would rely on the system and when it cocks up (think Erebus) blame the system as if it was some kind of surprise and humans would have been perfect.

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Oh anyone can write a simplistic system like the first one you posit.

The hard thing is writing the second one so it is usable. Can be done of course, just a matter of finding the right way of doing it and the budget to do it.

I think the other thing making it difficult is sensor technology.

Clearly if the sensors gave us a perfect view of the situation better than human eyes than you would not even need pilots in the planes if their positions / trajectory were known perfectly and the conditions were known perfectly. But the communication from the pilots is forming part of the feedback for the ATC guys. You would hardly want voice recognition running the show?

"Did you say Wasabi?"

I guess a long way off in the future as sensor technology gets better we will not need to drive our cars either, but until then I reckon the ATC guys are safe.

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Oh anyone can write a simplistic system like the first one you posit.

The hard thing is writing the second one so it is usable. Can be done of course, just a matter of finding the right way of doing it and the budget to do it.

My current thinking is that the system takes input from all systems (for example your thunderstorm) and refers back to similar situations of what the ATC did. If what the ATC is choosing to do deviates from history it queries the ATC and then if you affirm it raises it with a peer for confirmation.

Then, later it asks for the piece of input which meant a different choice was made (this is actually the really hard bit) and in future uses that as part of the sanity check.

The problem is that to build a system like that you need to bring it up in a situation where time is not such a constraint (I am sure that landing a bunch of big arse planes in a stress situation you don't want to waste time peer reviewing your colleagues). In a non stress situation of course the system doesn't get to learn how to react in a stress situation. So you need to replay the live situation back into the system afterwards and peer review at that time tends, due to human nature, to be completely different.

An example would be if you, in a high stress situation, do something which might not be optimal but still works your colleagues will trust you based on experience not to do something stupid and crash the lot. In a non stress situation human nature tends towards either blanket agreement with your actions or annoying nitpicking over optimal solutions.

Then of course the actual translation of the different systems input has to be done in a way that if one system sh*ts and burns the others treat that correctly, that would be an interesting problem actually. Planes cost too much to keep in the air to be uber safe but crashing one costs too much to not be. hehehe. Cool arse problem actually. Probably solve most of them with heartbeats I guess.

Writing the rule set would be interesting but I doubt it would be technically challenging. Been done for other stuff.

The real problem is that if the system does actually work and so the recruitment drive of ATC doesn't happen then the industry would rely on the system and when it cocks up (think Erebus) blame the system as if it was some kind of surprise and humans would have been perfect.

Interesting.

You know Tor, for a dba you know a lot about people. Those skill sets don't always overlap.

I just hope whoever writes the bloody system in the end (because some one will eventually) does, too...

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