Not a day passes over this earth but men and women of note do great deeds, speak great words and suffer noble sorrows.
Charles Reed
Counterproductive Progressive Energy Policies: We Need To Change Course NOW
It may seem unusual that an MIS academic and IT professional is writing a political blog but not (yet) a technology blog. But in fact I have done a lot of interdisciplinary research, and I'm always fascinated with innovative approaches to problem-solving. Take, for instance, the question of personal transportation. There are roughly a quarter million registered vehicles, of which maybe 55% are passenger cars. How do you fuel these? With oil prices, anticipating a robust global recovery, already heading close to $100/barrel and gasoline prices up nearly 16% over the past year (beyond wage growth), I'm sure Ben Bernanke should be very nervous... The last thing we need is an energy bubble, but keep in mind this is one artifact of a cheap dollar and the lack of oil independence, something the current Administration has fought off tooth and nail using the BP oil spill as a rationalization for progressive environmental policies...
We can talk about ethanol, but ethanol not only is less energy-efficient than gasoline, but it's incompatible with existing pipeline structures, requires considerable fertilization (and relevant pollutant runoffs in our waterways), and competes with food (e.g., escalating corn prices). We can talk about all-electric cars but there's a question of range and infrastructure (charging stations or battery replacement, available outlets (e.g., open parking areas))--and right now most power generation is carbon-based.
One interesting development is advancements in natural gas exploration and development, which have vastly increased domestic supply, to the point natural gas is selling for a fraction of the price just a few years ago. There had been a focus on converting buses and trucks to run on a compressed form of natural gases--until prices exploded. There may be a pick-up in converting coal-based power plants to natural gas ones; however, utilities realize that the supply/demand could change by the time a plant design translates into an operational unit.
There are other issues--including the compatibility of energy sources with existing engines (that's why, as most people probably know, the mix of ethanol with gas is usually capped at 15% or less of total volume). Ideally your fuel mix would be compatible with a quarter million registered vehicles on the road. There has been a lot of interest in algae-based fuels; algae don't compete with the food supply and under certain circumstances yield fuels consistent with gasoline-powered engines. Algae can continuously produce fuel in (say) 10-day cycles. The issue is not proof of concept but scalability (current yields are not enough to put a dent in total fuel demand). A full discussion of this topic is beyond the scope of this post, but there are some good summaries elsewhere.
The reason I've gone through this discussion is to show the complexity of the business and economics of energy. There are a number of things, but the policies of Obama and the other progressive Democrats are completely counterproductive. First, you can't and shouldn't try to pick winners and losers; protectionist policies (e.g., slapping tariffs on ethanol imports, farm subsidies, etc.) are counterproductive. For example, if Brazil is able to supply ethanol below our costs, we don't help the living standards of fellow Americans by paying an artificially high price for fuel. In the global market, Brazil would still have a compelling cost advantage. Second, there's the matter of unrealistic expectations. Even if the Chevy Volt sells well, there are production capacity issues, and in a tough economy, there are only so many $40K vehicles you can sell with 9.7% unemployment--and a low single-digit percentage of vehicles on the road. People should understand that the market follows the consumer--and if 98% of cars are not electric-powered, capitalists are reluctant to make huge investments in what appears to be a niche market.
So the bottom line is--whatever the progress in fuel development, producing a quarter of our own fuel and less daily--and leaving oil underground in American territory--with an out-of-control trade deficit is not a plan: it's a road to perpetual economic decline. Look at our overall economy--what do you think of the implications if people can't afford to commute because of out of control fuel costs? (If you thought the housing market was bad now, imagine if people in the suburbs find nobody willing to buy their house at any price--because potential homeowners have the same problem in commuting...) I understand environmental concerns, but the only way we're going to be able to afford the investment in environmental technology is with a robust tax base. And you are not going to get there with anti-growth economic policies (e.g., tax increases, high regulation, etc.)
A Rant on Public Education and Parents
There are other issues as well. We need a deep bench of scientists and engineers to lead the way to new business technology (e.g., many of the issues that need to be resolved to mass-produce algae biofuels). One way is through aggressive recruitment--and fast-track citizenship--of foreign-born science and engineering students and PhD's for our world-leading universities; but immigration discussions over the past 4 years have almost exclusively and counterproductively focused on low-skill, unauthorized Latino residents.
Another way is by shifting the culture towards what we see elsewhere versus the United States. I have found that most American IT recruiters do not really appreciate the fact I have 3 advanced degrees; ironically, I find many foreign-born recruiters are more intrigued by my educational accomplishments than my nearly 18 years of professional DBA experience. Now why is this the case? I hate to make broad generalizations, but within 3 years many of my students were earning more than I did as a professor--the road to a PhD included living for 2 or 3 years on a few hundred dollars a month which barely covered my basic school and living expenses. The typical tenure track is about 7 years; you teach four or so courses/classes, hold office hours, prepare lesson plans and assignments (Shakespeare doesn't change year to year, but technology does), perform university service (e.g., committee assignments), advise students--and also work on original research. This is no exaggeration--I was averaging over 70 hours a week as a professor, and that didn't include in my case looking for new/temporary academic positions my last 2 years. Maybe if I had achieved
This was not intended to be a personal rant but to explain that for almost a decade, I worked long hours for below-average compensation--and had my academic career snuffed out in the early 90's by a nasty recession. And it took a while for me to get my professional career restarted.
Today there's a lot of prestige to becoming doctors or lawyers, and this is not to demean these professions, but how many times do you hear the same about becoming a medical researcher or a scientist? Or even take careers as professional engineers, actuaries, or accountants: not only are curricula challenging, but in many cases there are long exam paths to certification and/or continuing professional development requirements.
Here's the point I'm getting to: there is a huge push, outside the US, for students to compete for, say, the few coveted seats in a university which is the ticket to a comfortable middle-class lifestyle. If you don't make the cutoff, it may mean a lifelong struggle to make ends meet.
For a long time in the US, fairly low-skilled work, e.g., work on an auto assembly line, meant a healthy wage, a nice retirement--without a college degree. Or maybe with a 4-year college degree, you joined an IBM or some other corporation which all but guaranteed a job for life, without an incentive to get an MBA or advanced degree unless you rose to management.
In short, I really think that we are heading in the same direction as other economies. I am aware, of course, there has always been stiff competition to get into the name schools (e.g., the Ivy League). But--and this is why I'm always ranting against teacher unions--doing the minimum to get your job ticket punched is no longer a viable strategy. We need a paradigm shift in the minds of parents; they need to be as obsessed with their kids getting ahead--where students attend extra classes on their own, maybe even study on Saturdays or through summers at their own initiative, not simply for bad grades. I'm not saying kids shouldn't have fun or do away with family vacations, but the amount of time kids play video games, watch TV, hop from one after-school activity to the next, etc., I think, is staggering.
I was a special case; my folks didn't have to push me. I was mostly bored with middle school until I encountered a rigorous sixth-grade English teacher. I liked teachers whom expected more from me, and I wasn't satisfied with just meeting their expectations. In high school, my biology teacher took me aside after class one day and told me I didn't have to attend class anymore--he was giving me my A. He explained it was unfair for me to sit in a class where I was at a different level than the rest of my class and he had to focus on the other students.
I think this is far more serious than Barack Obama or Education Secretary Arne Duncan's lip service to public charter schools. We need to get away from political correctness in the classroom, self-esteem, and other related progressive nonsense and get back to the core basics of reading, writing, math and science. (Even many of my better students couldn't write a well-structured, readable essay if their life depended on it.) To be honest, the libertarian in me objects to the concept of public schools and colleges altogether for exactly the reasons we are seeing in New Jersey and elsewhere. I just have zero faith in the ability of teacher unions to make the kinds of concessions necessary. If I had a child today, I would probably send him or her to a private school, even if I had to take a third job to pay for it.
Political Humor
A few originals:
- There are reports that Secretary of State Hillary Clinton is considering stepping down to spend more time with her family, Bill and newlywed daughter Chelsea. I'm not saying that I don't believe her, but it would help if her family still lived at home.
- Outgoing Congresswoman Carol Shea-Porter (D-NH) blames the moneyed interests of the Chinese for the Dems' losses in the mid-term elections. (After all, the Chinese bought a number of T-bills to cover Democratic super-spending.) You know what that must mean: yup, Oliver Stone is probably looking for a conspiracy between George W. Bush and the Chinese.
Musical Interlude: Holiday Tunes
Mannheim Steamroller, "Christmas Lullaby"
