How do you set the cam timing on a type 1 vw air cooled beetle engine?

You do it when you're building the engine. You can do it without any visual aids, but it's easiest to do this if you buy a bottle of model paint.

The cam timing system on an aircooled VW engine has a fairly small gear on the crankshaft, and a large one on the camshaft. The gear on the cam has a dot ground into one tooth; the gear on the crank has a dot on two adjacent teeth. You paint the teeth to make it easier to pick them out because those dots aren't very large at all. But whether you do or not, lay a case half on the table with the side the crank goes in facing up and install the crank and cam bearing shells in the case. Set the crank into them, and rotate it until you can see the two teeth on the crank gear. Mesh the cam gear with the crank gear so the dot on the cam gear is between the two dots on the crank gear. Roll the cam down into its bearings. (You DID put some assembly lube on them, right?) Now rotate the crank a few revolutions while watching the gears. If the dotted tooth on the cam gear always winds up right between the dotted teeth on the crank gear, you've done it right.