Monday, November 2, 2009

The Limits of Clean Energy

Introduction

Last Wednesday, October 27, 2009, President Obama toured a solar facility in Florida where he announced certain investments in clean energy technologies as part of his stimulus package. I sincerely hope that, all the lofty rhetoric notwithstanding, Obama’s science advisors are suitably realistic about the limits of solar and other clean energy technologies. They may pin great hopes on our ability to engineer a solution to our energy dilemmas, but they must also understand the facts as they currently stand.

I have no such faith in the press, the blogosphere, or the common man. Lately, I have heard and read accounts of renewables’ promise which are so far removed from reality as to verge on the absurd.

I am a big fan of clean energies, but I also am painfully aware of their limitations. In particular, I am not hopeful that we may soon generate a significant percentage of our energy from clean or renewable sources. I am on the board of directors of a company which makes products for the solar industry, so I have looked fairly deeply into the subject and am not sanguine about it.

In working these issues out for myself, I have concluded that there are at least two difficulties which keep people from truly understanding the limits of clean energies.

The first is human beings’ inability to conceptualize, and therefore to contextualize, large numbers. This phenomenon affects the understanding of more than just clean technologies. For instance, there are plenty of people who don’t really know the difference between a billion and a trillion. To them, both are just really large numbers. Thinking so, however, makes it awfully difficult to understand the issues at the bottom of last year’s financial crisis, for instance. In fact, a trillion is a thousand billions. They are vastly different numbers. If one doesn’t conceive the difference between several orders of magnitude, it will be frustratingly difficult to understand much about macroeconomics, and it will be even harder to understand the science of energy. Unfortunately, most people don’t.

The second reason people have difficulty with the science of renewables is unfamiliarity with the metrics used in describing and measuring energy. For instance, the cost of manufactured solar silicon panels is measured in dollars per watt. Well, what the heck is that? Most people have no way to put that figure in context. Most people know that a watt is a very small amount of energy, but they have no idea how small. At the other end of the scale, our typical power plant in the US generates something like 1,000 megawatts of electricity. Again, what the heck is that? Normal people just have no way of understanding the scale of that number. That particular metric also combines both difficulties I’ve mentioned, insofar as it is a very large number (1,000 megawatts is 1,000 million watts of electricity) and it also mentions the frustratingly opaque “watt”.

To a certain extent, I’ve struggled with these difficulties too when thinking about energy. In such situations, I’ve always found it helpful to write it down – to do the math, do the conversions. In my case, I generally write these things down on an Excel spreadsheet. So several years ago, I started to dig into the science of renewables by putting it all in a spreadsheet. And I found out some interesting things. Furthermore, I found that by doing a few extra calculations, I could then explain the issues in terms that people could really understand.

So now I have taken it upon myself to remedy these difficulties for the faithful readers of Polartics. In blog posts over the next several weeks, I will put the physics and economics of clean energy into terms that people can understand. Here is what I will do:

• I will develop a metric of energy that people can understand because it is based on human activity. As an aside, at this time I will also perform a few calculations comparing this metric to our current use of energy so that we can see just how much energy the average American actually uses (and how much we take that energy for granted).

• Second, I will perform an energy audit of my own home. Many readers of this blog no doubt live in digs similar to my own, and can probably assume that the scale of their energy use is roughly similar to mine (it may be off by a percentage, but it will not be off by an order of magnitude!). Once done, this energy will be put into the context of the understandable energy metric which I devised in step one.

• Third, I will translate the capabilities of today’s solar technologies into my energy metric, and use the result to calculate the amount (and cost) of solar technology which would be necessary to take my house “off the grid” (not just for electricity, but for all of my energy uses, including oil heat and hot water, and propane cooking).

• Fourth, I will perform a similar analysis with wind energy.

• Finally, I will wrap it all up in a post which will, among other things, discuss the preceding two posts taking into account the economies of scale which may be achieved with very large green energy power plants. I will also discuss the limitations presented by the unpredictable nature (no pun intended) of the sun’s shining and the wind’s blowing, and I will come to some conclusions about the topic.

So then, without further ado, let us begin!

Chapter One - The Energy Metric

Ever since I busted up my knee playing soccer three years ago, this is how I get my exercise during the winter:

video

I generally max out at about an hour. It’s hard to ride on rollers such as these, because you can’t stop pedaling or you’ll fall down. I’ve done that a few times, and it’s not pleasant.

In an hour, I generally burn just under 1,000 calories. I know this because I wear a heart monitor. These monitors are not perfect, but they’re close enough for our purposes. Since calories and watts are both simply different measurements of energy, it’s very easy to convert from one to another if you know the conversion factor. It turns out that if I ride on my rollers for an hour and burn slightly less than 1,000 calories, then I am generating just over 100 watts of energy the whole time. It’s pretty darn hard work. I don’t know if you could see it, but there was a lot of sweat dropping off my face in that video.

To put 100 watts in perspective, an elderly person out for a leisurely stroll might generate about 5 watts of energy. Conversely, a professional bike racer may generate over 400 watts while climbing up the steepest climbs in the Tour de France, but he can’t sustain it for very long – maybe 30 minutes to an hour.

So, that’s it. The metric I will use to explain the physics and economics of energy is the amount of energy that I generate while riding on my rollers. I’m going to call this unit of energy a Matt. Once again, a Matt equals 100 watts. If I were to generate this amount of energy for an hour, I would call this energy a Matt-hour. If I were to ride my bike like this (I couldn’t, but just imagine I could), for an entire day, it would be called a Matt-day. For a month, it would be a Matt-month; for a year, a Matt-year, etc. Essentially, it is a way to put energy into human terms. A Matt-month is approximately the amount of energy that I could produce, working really hard, in a month. Similarly, a Matt-hour is that amount of energy that I could produce in an hour.

OK, so now that we have this energy metric, let’s determine how many Matt units are in some other sources of energy that people often talk about. For instance, how many equivalent Matt-units are in a barrel of oil? How long would it take me, working hard enough to have sweat dripping off my face, to generate the energy which is contained in a barrel of oil?

Why don’t you take a guess.

Two days?

Five days? In five days of furious work, could I generate the energy in a barrel of oil?

Well, not quite...

Ten days?... Fifteen days?... A month?

In order to make this analysis really visceral, really understandable, let’s make a Matt-day only that amount of work that I could do in a real work-day, meaning eight hours, from nine to five. Furthermore, let’s assume that I would get my weekends off, and I’d get some holidays and a vacation. There would therefore be eight work hours in a day, 20 work days in a month, and 250 work days in a year. These would all be translated into Matt equivalents, which is that amount of energy which I could generate while riding my rollers (i.e. 100 watts).

Under these definitions, how much Matt work is in a barrel of oil?

Keep guessing.

The answer, ladies and gentlemen, is 8.5 years. (The math is not all that complicated. You can skip to the end of this blog post to see the calculations.)

There are 8.5 years of my hard, sweat inducing, thirst generating labor in a single barrel of oil.

Wow. A barrel of oil today costs just under $80. Compare that to the actual cost of human labor. Let’s say my landscaping guy pays his workers $20/hour. By the time those workers have toiled for 8.5 years, he would have paid them $340,000. And yet I can buy the equivalent amount of energy in a barrel of oil for $80. Are you starting to see why I said we take our energy for granted? Oil is ridiculously cheap.

Those numbers sound almost absurd, so let’s do a quick sanity check to make sure that we’re not screwing something up. Let’s compare those calculations to some other ones which you might be familiar with.

There are 42 gallons in a barrel. My car weighs about 3,000 pounds. It gets about 25 miles per gallon. That means that a barrel of gasoline (let’s ignore the difference in energy between crude and gasoline for the moment) would propel my car 42 * 25, or 1,050 miles.

How long would it take me, with my bare hands, to carry or push 3,000 pounds 1,050 miles? Let’s ignore the practical difficulty of that question (I’d have to break the car up into small pieces in order to do it), but let’s only consider the scale. I’ve got to move 3,000 pounds 1,050 miles. How long would it take? That’s from Far Hills, NJ to about Des Moines, Iowa. If I could push 300 pounds at once, that would take me ten trips walking back and forth. How long would that take? 8,5 years? Certainly sounds reasonable.

Let’s face it, driving a car uses an absurd amount of energy, and we take it for granted. In fact, if you do this math with virtually all of our uses of energy, you’ll find the same thing. Flying to Vail, heating your house, running your dishwasher, taking a hot shower, blow drying your hair. Compared to Matt-units, these things just suck energy away like it’s free. I read on some other blog page that it would take an elite athlete 30 minutes of vigorous work to heat a liter of water to 100 degrees Celsius to make a pot of tea.

We are hopelessly, hopelessly addicted to cheap energy. And that could be a problem.

In my next post I am going to calculate exactly how much of this cheap energy I use in my home, and then in subsequent posts, I am going to see how difficult it might be to generate that energy through clean technologies.

So, get your calculators all warmed up for next week’s blog post. Goodbye for now.

Calculation of Matt energy in a barrel of oil

How much energy in a barrel of oil? (from Wikipedia)
6.1178632 × 109 Joules

1 Joule = I watt/second

So, divide by 100 to get seconds of Matt energy in a barrel of oil = 6.1178632 x 107

Divide by 60 to get minutes of Matt energy = 1,019,644

Divide by 60 to get hours of Matt energy = 16,994

Divide by eight to get work days of Matt energy = 2,124

Divide by 250 to get work years of Matt energy = 8.5 Years!

Friday, August 21, 2009

Healthcare as a Right

Life continues to be busy, so I have not had the chance to dig into the various healthcare bills being bandied about the House. To do the topic justice would require prodigious amounts of time, so I’ve resigned myself to being a spectator in this particular debate.

However, there is one issue upon which I’d like to comment, and that is the tendency of various liberal defenders of Obama’s healthcare plans to declare that healthcare is a right. This tendency seems wrongheaded to me for at least two reasons.

For one thing, healthcare is not yet a legal right. There is no Amendment 10.5 which states that individual citizens have a right to healthcare. It may be proper to discuss (or even declare) that healthcare ought to be a right. But to declare that healthcare is a right gets ahead of ourselves.

I acknowledge there were times in our history when thinkers have declared one right or another to exist in advance of its being codified in law. However, these statements have traditionally referred to natural rights, such as life, liberty and the pursuit of happiness. I don’t think that John Locke was thinking about government-sponsored healthcare when he developed his theory of natural rights in the context of the social contract.

We do now have certain legal rights: a right to practice religion of our choosing, a right to peacefully assemble, a right to bear arms, a right to free speech. These things are codified in the Constitution. Other rights, such as the right to abortion, or the right counsel upon being arrested, have been conferred upon us by the courts.

But we do not yet have a right to healthcare. It is reasonable to argue that we should have one, but we don’t have one yet.

The second reason why the “right to healthcare” is misguided has more to do with the goals of those who would utter such a phrase. I would bet that a great majority of those who consider healthcare to be a right do so in furtherance of a policy of government-sponsored healthcare.

But rights are restrictions on government power, not grants of government power. The fact that I have a right to my religion means the government must allow me to practice this religion in a manner of my choosing. It does not mean that government will construct my church, pay the preacher and provide a bus for me to get back and forth on Sunday mornings. Same for a right to free speech. Government may not abridge that right. It does not mean that government must purchase me a megaphone, buy me a television advertisement or procure a spot for me on Larry King.

Under this reading, a right to healthcare means that government should get out of the way and allow people to pursue the thing in as efficient or inefficient manner as they see fit.

And here’s the great irony: any reasonable reading of Obama’s healthcare plans would have to acknowledge that healthcare rationing is part of the plan. In order to make it public, and to make it affordable, it would be necessary to ration it in some form. Obama himself has acknowledged as much, although in Clintonesque doublespeak.

Think about that: the very people who argue that healthcare is a right are the same ones who would abridge that right by mandatorily providing healthcare to certain people in such a way as to diminish their ability to procure it.

Wednesday, May 27, 2009

Sotomayor

Obama has appointed appeals court judge Sonya Sotomayor to the Supreme Court to replace David Souter.

I will have a lengthy commentary on her shortly, but in the meantime, a prediction:

In a 2001 speech at UC Berkeley, Sotomayor said this: "I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn't lived that life."

This sentence will become the focus of a great deal of controversy over the next couple of weeks.

When I read it, it struck me as preposterous. The more I think about it, the more incensed I get about it. More later.

Tuesday, May 12, 2009

You Know You Live in a Rich Country When #1

Like most busy people, I am choosy with my reading material. I simply don’t have time to read every glossy magazine that comes within my field of vision.

The Yale Alumni Magazine gets the same treatment as any other glossy, with one exception: without fail I will pick up the magazine and flip to the Alumni Notes to see what my classmates are up to. I’ll even quickly scan the nearby classes to see if I recognize any names.

Something struck me as I read last month’s issue. Virtually every Note from one of my fellow alumni/ae in nearby classes was penned by someone who was an activist, advocate or organizer of some sort. There were environmental activists, community organizers, women’s advocates, and numerous other designations of people who do nothing other than think or communicate about a cause.

It further struck me how extraordinary this was: that a non-trivial percentage of highly educated, highly paid people might be engaged in nothing but advocacy.

I travel quite a lot in the third world for my job. At MidMark, we own a number of manufacturing companies which have facilities in places like China, India and Mexico. I can say with some confidence that there are not a lot of people in such places who are highly paid advocates. In fact, the kinds of concerns which occupy people in the third world are things such as feeding themselves, clothing themselves, and making sure they have reasonable living quarters. Most people have jobs which are either directly related to manufacturing or are somehow related to those very basic concerns of food, clothing and housing. Who has time for women’s issues when one is concerned about where your next meal is coming from?

Last month’s Alumni Notes could only have been written in a country with a tremendous amount of wealth. At the risk of shocking people with irony, I must say it would behoove all those American advocates to consider, from time to time, how we got here. As we consider our future and the policies we craft in pursuit of it, we need to make sure that we do not kill the goose which lays the golden eggs (or the golden advocacy jobs, as the case may be). From my perspective, the goose’s head is right now on the chopping block. Obama’s holding the axe. I’m hoping someone stops him before he brings it fatally down.

For brevity, I’ve skipped several logical steps in this last paragraph. Those who know me will know what I’m talking about. If these steps were too fast for you, please leave a comment here, and I’ll be happy to elaborate.

NOTE: I see so many examples of the irony of living in a wealthy country that I will make the topic a regular series. Therefore, this is #1 in the You Know You Live in a Rich Country When series.

Friday, April 24, 2009

Harold Koh

My Letter to the Editor of the Yale Alumni Magazine today. Let's see if they publish it!

April 24, 2009

Dear Editors,

Contrary to the implication of your article, one does not have to rely on hearsay from a talk in a Greenwich home to conclude that Professor Koh is a “radical” who believes that “the distinctions between U.S. and international law should vanish. . . .” One can simply rely on his published work in, among other places, the Yale Law Review. Here’s a quote from the American Journal of International Law: "domestic courts must play a key role in coordinating U.S. domestic constitutional rules with rules of foreign and international law, not simply to promote American aims, but to advance the broader development of a well-functioning international judicial system."


Professor Koh would subvert the Supremacy Clause of our constitution. His ideas represent a dangerous affront to the sovereignty of our citizens. Furthermore, any transnationalist legal framework is necessarily arbitrary, since judges would presumably apply only foreign laws which they deem worthy, while ignoring others. That is not a legal framework at all, but rather an excuse to impose by judicial fiat that which should properly be left to the legislative branch.


It’s one thing to have someone like Harold Koh as the dean of Yale Law School – I almost expect as much. It’s much more troubling, however, to have him nominated to be the top legal expert at the State Department. Unfortunately, I don’t think the American public really understands what’s at stake.

Regards,
Matthew Finlay
Far Hills, NJ
Saybrook ‘90
mfinlay@midmarkcapital.com

Wednesday, March 25, 2009

Tax Deductions for Charity

Last night Obama held a press conference during which a reporter asked him about his administration's plans to reduce tax deductions on residential mortgages and contributions to charitable organizations.

I'd like to make two comments about this topic: one about the issue generally, and another about Obama's specific answer to the question.

First, a comment on the more despicable of the two.

Here is a portion of Obama's answer to the reporter:

"In that sense, what it would do is it would equalize -- when I give $100, I'd get the same amount of deduction as when some -- a bus driver who's making $50,000 a year, or $40,000 a year, gives that same $100. Right now, he gets 28 percent -- he gets to write off 28 percent. I get to write off 39 percent. I don't think that's fair..."

This logic is either twisted, or fundamentally dishonest. Because it fails to acknowledge that the reason the wealthy tax payer gets a 39% deduction and the bus driver gets a 28% deduction is because the wealthy tax payer pays a 39% marginal tax rate and the bus driver pays a 28% marginal tax rate. It is only by virtue of a person's paying money to the government that he or she gets a tax deduction!

When I hear someone making an argument like this I honestly want to know what has caused him do so. There can only be a couple of reasons: 1) he's dishonest, and doesn't mind pulling the wool over the eyes of modestly stupid people; or 2) he's modestly stupid himself; or 3) he believes that all money is actually the government's money, so it doesn't matter what marginal tax rates are when contemplating tax deductions; or 4) he's a sadist, and wants to hopelessly complicate the tax code.

In this case, I believe Obama's words were some combination of #1 and #3, with a wee, tiny bit of #2. (I say #2, because I don't think that Obama has ever operated an Excel spreadsheet, so probably has a hard time visualizing things like gross and net). In any event, it makes me sick to my stomach.

But onto the issue itself, because it illuminates another of piece of Obama's mind which has always been blindingly clear to me, but apparently was not to such people as Christopher Buckley or David Brooks.

In a later portion of his answer, Obama said "there's very little evidence that this has a significant impact on charitable giving."

Now, every study I've ever seen concludes the exact opposite. Common sense would conclude the exact opposite. The Executive Director of every 501(c)(3) in this country would probably conclude the exact opposite.

I do not believe for a moment that Obama actually believes what he said. But, it really does not matter. Because Obama really would like it if government expenditures crowded out private donations.

Why would we need privately funded soup kitchens if the government provided soup for everyone? Why would we need privately funded performing arts centers (disclosure: I am on the board of a privately funded performing arts center) if the government, through the NEA, funded all of our performing arts centers? Why would we need any 501 (c)(3) if government provided all the goods and services that these organizations provide?

Well, we wouldn't.

So, what I've concluded is that Obama was dishonest about the issue in furtherance of his ultimate principle: that government is the solution to everyone's problems.

Overwhelmed

It's been a while since I've posted here, but don't think my silence is some indication of contentment. On the contrary, my silence is a combination of two things:

** I've been busy in Korea, China, Vermont and France, and

** The sheer enormity of outrage flowing from the Obama administration has made it hard to know where to start. First came Obama's stimulus package, which I've previously commented on, and then came his inaugural budget, which upped the ante considerably. Obama's disingenuousness in selling both pieces of legislation has been nothing short of historic. Pretending that we need to compensate for the sins of our leveraged, profligate ways by taking on ever more towering leverage in order to provide for ever more profligate spending is something which only someone as silver-tongued as Obama could pull off. The only question is how he does it with a straight face.

And with regard to contentment, the opposite is true. I have settled into a deep and lasting pessimism. I am beginning to feel that the steps that are being taken right now to launch the United States toward a European-style social democracy may well be irreversible. Even if some Ronald Reagan were found in the next eight or ten years, the damage may have been done. The miracle which is the United States may be being lost, right now.

The only person who seems to be taking notice of this deplorable situation is Charles Krauthammer. Regular ole Americans are so distracted by the economic turmoil that they are, in my opinion, largely unaware of what is going on.

Anyway, a couple of things have happened in the last few days which I have a particular experience, or interest, in, so I will be posting on those things. Then, I head to Paris for two weeks, so you may or may not hear from me depending on how it goes.

Tuesday, February 17, 2009

Obama Hoisted on His Own Petard

Re: my gripes about Obama's double-talk regarding bi-partisanship (see here and here), here is an absolutely fascinating passage from his 2006 book The Audacity of Hope (presumably written when Republicans were still in control of Congress):

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"Genuine bipartisanship," he wrote, "assumes an honest process of give-and-take, and that the quality of the compromise is measured by how well it serves some agreed-upon goal, whether better schools or lower deficits. This in turn assumes that the majority will be constrained -- by an exacting press corps and ultimately an informed electorate -- to negotiate in good faith.

"If these conditions do not hold -- if nobody outside Washington is really paying attention to the substance of the bill, if the true costs . . . are buried in phony accounting and understated by a trillion dollars or so -- the majority party can begin every negotiation by asking for 100% of what it wants, go on to concede 10%, and then accuse any member of the minority party who fails to support this 'compromise' of being 'obstructionist.'

-----------------------

I could not come up with a better description of what happened in the last two weeks if I tried.

Hat tip: Bill McGurn of the Wall Street Journal today

More Cost of Energy Stuff

Remember my blog post (here) where I conjectured that the recent economic slump might trace its origins to a massive increase in the cost of energy?

Well, listening to JP Morgan's Chief Economist while at an ACG-NJ meeting this morning, a thought occurred to me: The two largest post-war economic crises are today and 1982.

Look at this chart below of the real cost of a barrel of oil:



(Click in the image to enlarge)

Interesting, eh? Seems like we've been here before... I am starting to convince myself that I might be right.

People keep talking about the sub-prime crisis being the cause of our economic slump. I don't think that's right. I think an energy crisis caused the beginning of a sub-prime crisis, which caused the current economic slump to be worse than ever before.

Friday, February 6, 2009

The Stimulus of Partisan Warfare

Last week, after reading several hundred of the 700 page stimulus bill passed by the house, I chided myself for not knowing what was going on (see here).The bill read exactly as it is: an orgy of spending on the far left’s long-standing Christmas list.

The fact that it had been crafted by Nancy Pelosi and the House Democrats left open the possibility that Obama had originally been intending to contrive a stimulus bill in earnest, but that he was forced to capitulate when the process in the House took on a life of its own. At least that’s the way I wanted it to be.

Well, based on Obama’s comments last night at a Democratic retreat in Williamsburg, he was in on the plan from the very beginning. Here are some of his comments regarding the stimulus bill:

--------------

THE PRESIDENT: Now, I just want to say this — I value the constructive criticism and the healthy debate that's taking place around this package, because that's the essence, the foundation of American democracy. That's how the founders set it up. They set it up to make big change hard. It wasn't supposed to be easy. That's part of the reason why we've got such a stable government, is because no one party, no one individual can simply dictate the terms of the debate…

So I welcome this debate. But come on, we're not — we are not going to get relief by turning back to the very same policies that for the last eight years doubled the national debt and threw our economy into a tailspin.

We can't embrace the losing formula that says only tax cuts will work for every problem we face; that ignores critical challenges like our addiction to foreign oil, or the soaring cost of health care, or falling schools and crumbling bridges and roads and levees. I don't care whether you're driving a hybrid or an SUV — if you're headed for a cliff, you've got to change direction. That's what the American people called for in November, and that's what we intend to deliver.

So the American people are watching. They did not send us here to get bogged down with the same old delay, the same old distractions, the same talking points, the same cable chatter. You know, aren't you all tired of that stuff?

AUDIENCE: Yes!

THE PRESIDENT: They did not vote for the false theories of the past, and they didn't vote for phony arguments and petty politics. They didn't vote for the status quo — they sent us here to bring change. We owe it to them to deliver. This is the moment for leadership that matches the great test of our times. And I know you want to work with me to get there.

------------------

Obama admits it: this isn’t a stimulus bill! This is the beginning of his “Change.” What does foreign oil or healthcare or SUVs have to do with stimulus? Nothing. This is his big, grand opportunity, only two weeks into the new administation. A new beginning. And oh, what a beginning. A trillion dollar beginning. Boy, does this ever set the bar low for incremental change.

And here I was, naively believing Obama’s pre-election rhetoric about a new post-partisan world! This bill is the old, hyper-partisan world on speed and crack, driving a turbocharged crotch rocket.

Guess what, Mr. Obama. This is now war. And you are in our sights. I haven’t been this mad in a long, long time.

Wednesday, January 28, 2009

The Stimulus of My Current Anger

Life has been busy lately. MidMark has not been immune to the economic malaise, and we have been busy trying to keep our portfolio working properly.

So while I have read the headlines occasionally, I have not spent much time digging into the details. The topic dominating the headlines recently has been the stimulus package, which passed the House today (apparently without a single Republican vote – so much for Obama’s post-partisanship!).

Not knowing much about it except that it included a lot of money for infrastructure projects like bridges and highways, I assumed that it had been crafted largely by economists who had sat in a room somewhere trying to think of all the ways that we could get our economy rolling again by using the treasury to spend money on stuff. Presumably, there was a method to the madness.

Hearing that the stimulus bill had passed the house, I set out tonight to find out some details of this $900 billion bill. I searched around Google for a summary of the stimulus, but found only either vaporous news articles, light on facts but heavy on politics, or true position papers from the online blogs and opinion journals. I didn’t want someone’s opinion, I just wanted the facts! What’s in this damn bill?

One of the blogs I read had a link to the actual bill itself (I’ll have a link at the end of this post). Having recently spent a good portion of my life perusing voluminous legal documents, I’ve become quite a good speed reader, so the prospect of actually reading the bill rather than someone else’s version of it was appealing. I clicked right in.

First thing I found: 647 pages. Ugh. But I’m a really good speed reader, so, undeterred, I read on. I flashed through the first 50 or so pages which covered policies & procedures, transparency, oversight boards & the like. Pretty boring.

Soon, I got to the good stuff. It’s not a complicated bill. It’s written clearly in very simple language. First, I found an appropriation of $44 million for “Agriculture Buildings and Facilities.” Not much of any explanation, just $44 million for some buildings. Huh? But I continued. Then, there was $2.825 billion for “the cost of broadband loans and guarantees.” Huh? Where’d that number come from? Then, there was $50 million for “Youthbuild activities” and $750 million for “a program of competitive grants for worker training and placement…”

My heart started to sink. I was starting to get it. I started flipping through pages faster. $120 million for “community service for older Americans.” $462 million for “disease control, research and training.” No explanation, no details, just that: $462 million for disease control, research and training.

On page 131 I stopped flipping through pages. Shame on me. Shame, shame, shame on me for not knowing what was going on here. All these past few weeks, I was blithely carrying on, thinking that Obama and his smartest economists were sitting around with charts and graphs, trying to figure out the most effective way to deploy government dollars into our markets in order to grease the wheels of commerce.

Instead, what happened was that he went to Congress and said: “hey, what do you guys want?”

This damn bill is full of $900 billion worth of pet projects that people could not get passed or funded under normal circumstances! Where’d all those odd numbers come from? Certain people had been thinking about those things for years! When Obama said – hey, we don’t have to worry about deficits anymore – everyone just piled their favorite spending into a bill and they hid their true intentions by calling it a stimulus bill!

Read it. Please. Follow this link and read it. This bill is simply horrifying.

Let me be clear – I am not coming down on one side or the other of the current argument about the effectiveness of fiscal stimulus. I am simply pointing out that this particular bill is not a stimulus bill. It is an orgy of spending. It is Santa’s bag of gifts for House and Senate democrats. It is the far left’s greatest, sweetest dream come true.

I’ve been reasonably willing to cut Obama some slack over the last few weeks. He’s seemed smart and pragmatic, and has seemed to solicit opinions from just about everyone before making any decisions. But now, whatever my thoughts on the effectiveness of a true stimulus, one thing is very clear: my short honeymoon with Obama is OVER!

Thursday, January 22, 2009

Too Much

For some years, I have been something of a climate-change skeptic. Let me note here that that being a “skeptic” is a good thing, especially in the case of science, and especially-especially in the case of complicated science.

To be sure, I am not a scientist myself. But I have spent several years studying certain data associated with real climate change (i.e. world temperatures do seem to have climbed approximately 0.7 degrees Celsius over the last 100 years). I have done many indepent regressions testing out various local temperature trends. And I do have many years of computer programming, and (more important) computer modeling experience (this is important insofar as most of the significant conclusions of the climate change crowd can only be reached by relying on the output of complicated computer models which attempt to predict future climate).

I have slowly come to the conclusion that we know far less about our future climate than most climate alarmists would have you believe. Furthermore, I have also come to the conclusion that there is a fair bit of dirty ball being played by the other side to get the data to work out correctly. It seems that every time a skeptic points out a legitimate inconsistency in the climate change theory, after several years, somebody else comes out with some harebrained (but peer reviewed!) paper about why that particular inconsistency was actually consistent with the theory all along (and, obviously, thereby changing the theory along the way). My gut has told me that Michael Mann and his compatriots at RealClimate were, consciously unscrupulous or not, masters at this particular game.

Until now, aware of my own limitations, I have been reluctant to post about this topic. But upon seeing yesterday’s headlines, I knew something was up, and I lost patience. This is just too much.

PS: Pielke’s last statement is the greatest unanswered question in the climate change world.

Friday, January 9, 2009

Whose Fault is All This?

As reports roll in about unemployment reaching levels last seen in the Great Depression (this is not yet true on a percentage basis, but that does not stop the press from reporting such things), and as scandals such as the Madoff affair unfold, our collective national psyche is searching for villains to blame.

There are quite a few to choose from: Stan O’Neal of Merrill Lynch, Franklin Raines of Fannie Mae, Madoff himself. Others would like to paint the entirety of Wall Street itself (as distinct from “Main Street”) as the villain. Still others have found even more specific grievances to air: Deborah Spar, President of Barnard College, has recently pointed out in a Washington Post Op Ed that most of the guilty parties identified so far are men, and wonders whether there isn’t some innate difference between the sexes which accounts for the more testosterone-enhanced among us being more prone to the types of excess which led to the current financial collapse.

While there may be something to Ms. Spar’s thesis, I can’t help but wonder whether all of these thousands or hundreds of thousands of people (some of whom I know, by the way) can all be truly evil (or even just stupid).

I suspect not.

Taking the argument one step further, why do we suppose that, while the great things that make our economy dynamic and lead to ever greater standards of living are somehow widespread and universal, the opposite, those which cause financial distress and cause decreasing standards of living, are somehow always the result of individual turpitude?

As most of us know, Adam Smith described the former as the “invisible hand.” This is the principle that hundreds, thousands, perhaps even millions of individuals, each pursuing their own particular utility, will collectively result in the betterment of mankind.

But is it not possible that the invisible hand is also responsible for economic turmoil? I think it was Benjamin Graham who, when asked what was going to happen in the stock market, said it was going to go up and it was going to go down. Is it not possible that there is some equivalent with regard to the economy in general? Is it not possible that the invisible hand moves economies down as much as it moves them up (although inexorably, over longer periods of time, mostly up)? Is it not also possible, therefore, that these downward economic dislocations are simply the result of hundreds, thousands, perhaps even millions of people, each pursuing their own particular utility?

I suspect so.

The implication of this theory is that some people are going to be frustrated very soon. One class of people will be frustrated because their search for villains will prove more elusive than hoped. They will look deeply into the actions of the purported villains only to find, surprisingly, that each of these people acted somewhat in accordance with accepted strategies and procedures, and further, that they probably behaved rationally given the information available to them.

Another class of people, for whom I have the deepest empathy, will be crucified, notwithstanding that they acted rationally and in accordance with generally accepted strategies and procedures. Stan O’Neal particularly comes to mind. He’s probably a decent fellow, and when things were going well, boy, they were going really well. But now that they’re not going so well, nobody really remembers the circumstances under which he made his decisions. The assumption is that he was complicit in some great theft from the masses, rather than just a CEO trying to make the most money for his corporation, and generally unaware of the financial disaster looming ahead. Frankly, nobody saw this coming. I listen to Chief Economists all the time, and not one of them gave us a whisper of what was to come.

And now it’s all Stan O’Neal’s fault?

There are people who will go to jail because of this unquenchable thirst of ours for fault-finding. The Bernie Madoffs of the world certainly deserve to go to jail, and for a long time. But I will guarantee you that more than just a few Stan O’Neals will go to jail, too, just to satisfy a weird craving humans all have to blame someone when something goes wrong. And that’s a shame.

Friday, January 2, 2009

The Irrational Demonification of the SUV

There is a lot of bad math and bad logic on the topic of energy being cast about these days.

The example of sloppy thinking which irks me the most is the simple use of miles per gallon as the final arbiter on energy efficiency, and thus, in the minds of many, moral cleanliness.

In my estimation, an SUV which gets 15 miles per gallon but regularly carries five people and all their gear is about five times as efficient as a Porsche 911 which gets 15 miles to the gallon and regularly carries one person and maybe a cellphone. When people rail about wasted energy, why do they talk about SUV's instead of sports cars?

As I drove my family home from a short vacation in Washington, DC, today, all five of us in the car, stuff packed to the rafters, I realized that the more appropriate measure for energy efficiency should be person-miles-per-gallon.

Under that standard, we were cruising along at about 80 PMPGs. In order to commute alone as effectively, our neighborly Prius driver would have to pitch his prized hybrid in favor of a motorcycle. I try to take it one step further by riding a bicycle to and from work as much as I can.

Full Disclosure: until very recently, I also regularly drove a Porsche. Please realize, I am not moralizing here, only pointing out faulty logic.