Examples off the top of my head:

-Automobile bodies are made of thinner metal than used to be the case, yet automobiles are more durable than ever. The extra metal is superfluous despite the fact that modern cars lack some of the perceived solidity of older vehicles.

-Cheap hard-disk arrays can be at least as reliable as are expensive, “high reliability” hard disks used singly.

-An example from my own experience (that I’ve mentioned previously). For an application requiring highly reliable point-to-point Internet service with low latency, shared-loop consumer-grade DSL was too unreliable and a point-to-point dedicated connection was too expensive. However, a combination of two, independently routed (easy to check via tracert) consumer-grade DSL accounts turned out to be adequately reliable at a small fraction of the cost of the dedicated line.

-Cellphones are unreliable but people almost always use them in conjunction with other communication methods, so the communication system as a whole is fault-tolerant. If your cellphone doesn’t work for voice you can text, and if text doesn’t work you can email or IM. And there’s always the highly reliable landline, formerly the only commonly available system of networked communication, as a backup.

So there are 1) goods and services that were, to use a metaphor, overbuilt in the old days and that are now produced more efficiently (the car bumper), and 2) goods and services for which it’s more efficient to use the equivalent of a computer RAID than to put all resources into a single, high-quality service point which also becomes the critical point of failure.

However, I think that you’re probably entirely correct WRT electrical power generation and air travel. My caveat in these cases is to suggest that things may work out OK as long as degradations in centralized service happen gradually and people can adjust their behavior. For example, in my area property developers have started to offer high-end condos built to exceed local codes for windstorm resistance and including backup power generators. I assume that the trend toward increasingly local and personal self-reliance will continue, and I don’t think that this trend is necessarily a bad thing, though I assume that electrical power will become more expensive as you and David Foster have predicted.

In sum, we appear to be moving from one set of tradeoffs to another. This shift is being driven both by policy errors and unpredictable events (9/11). I agree with Shannon that the risk is not so much the shift itself as it is the possibility of sudden discontinuities during the transition.

Elites always have influence out of proportion to their numbers–not only by dint of their money, but also because of their free time and flexible work schedules. Look at all the “Good Government” and “Civic Improvement” organizations/commissions in any major city and the extent to which they influence the course of a city’s development. These are essentially UNDEMOCRATIC institutions comprised mainly of well educated and financially well-off professionals who have the time and skills to volunteer their efforts. Blue collar workers and below(the majority) gain input only through their elected representatives. Elites have access and influence both ways.

A note on cost v. reliability: Just think, if one has a land line phone, the monthly cost just to get the dial-tone (which will probably be there even after a nuclear attack–thats why so many switching centers look like the Fuhrerbunker) is roughly the same as a basic cable package.

I disagree that we have a government that reflects the will of the majority. I recall that Prop 209 in California restricted services to illegal aliens but a court overturned it. This happens time and again- ballot propositions and laws produced by elected officials at the state level get thrown out by courts.

Each time this happens some number of voters get so p@$$ed off that they cease participating in the political process- and effectively give up on democracy. As you note the elites are slowly losing their hold on the public discourse but the question is will that actually matter?

I sure hope so.

Of course you’re spot on about Wall Street. See here http://market-ticker.denninger.net/

Another service industry that is suffering is financial services. We have had three major bubble collapses in the last decade; Asia ‘97, .com ‘00 and mortgages ‘08. The viability of financial institutions is now so threatened that the Fed had to step in to save a non-member from collapse. Yet the Fed and the Comptroller of the Currency barely perform their examination function. Very large banks are having a hard time raising capital. And you don’t even get a toaster any more. I wonder how Brown Brothers, Harriman is faring.

I think the US elite already regard themselves as citizens of the world and consider most of the American people as nothing more than another kind of peasant.

This manifests in the continuous attempts of the elite to ensure that election results are as close to meaningless as they can make them. Real power is passed to unelected and effectively unaccountable organizations such as the courts, NAFTA tribunals, the UN, and executive agencies.

The question for American democracy is whether the constitutional framework can produce an elected government strong enough to overcome the wishes of the elite and impose the will of the majority.

Time will tell.

As to in-home generators, I live where winter ice storms and multi-day power outages are common; my next-door neighbor had a back-up installed a few years back. I would guess the neighborhood runs, oh, mid-upper middle class. I’ve heard radio ads for generators running on natural gas (or propane) at costs not too unreasonable – so your depiction of upper-scale homes having back-ups seems reasonable.

For one, I am one of the people who always try to drive to our summer vacaion destination if at all possible. Screw losing a vacation day – I work to hard to lose them.

Recently, I was made aware of a business trip I must take to Atlanta in September. Luckily for me, there is a direct flight from Madison to Atlanta on Delta – the price including taxes was just over $800, plus I have to pay to park my car $9 each day, and it is a six day trip so that totals $854. Alternately, I can fly from Milwaukee to Atlanta on Midwest round trip for $217.50, which also includes taxes. I will need a hotel room in Milwaukee for the night before, that will add $100 (not mandatory, but does make it easier in the morning), however I can park my car at the hotel for free for the duration of the trip, and get a free shuttle to the airport from the hotel and back to the hotel when I return. If you include gas, this puts my cost at about $375. I am out about a total of three hours of drive time round trip for the ride from Madison to Milwaukee and back (1.5 hours each way).

I can see charging a premium for the convenience of flying out of the local, small airport, but for that premium to be more than twice the cost seems a bit crazy to me.

The biggest problems with the system are (a)the physical airport constraints, as I discussed above, and (b)the hiring and retention of controllers. There seem to be some management practices which make the job even more stressful than it needs to be, such as the recently-adopted dress code, which seems ridiculous for people who work in towers and radar rooms.

There are indeed some big opportunities to improve the system technically, especially through the use of GPS-linked transponders to provide aircraft position information (in addition to or maybe someday in replacement of radar) but these aren’t going to fix the problems of physical runway constraints.

The air traffic control system has to be a textbook example of a government entity that needs help. They still have their ancient computers right out of “Airplane” despite various plans for upgrades.

Southwest upended the game by getting out of the major airports where they can avoid congestion and fees… plus the “secondary” airports that they went to were happy to have Southwest as a tenant. In this way they injected a bit of competition into a system that would otherwise have been a monopoly, albeit a monopoly where one end is being strangled (the airlines) and the other end (airports full of government cronies) are gorging and getting fat. Ever wonder why Chicago has such strange geography? Because they wanted to hold O’Hare within the city proper so that they can hold all the revenues and lucrative contracts (with opportunities for the scraps for themselves).

Certainly the airport / airlines / hub & spoke system is dying right now, before our eyes. Likely the future is something like Southwest for the states, a bus-like trip overseas, and super elite overseas travel. Everyone who can is avoiding airports nowadays, anyways (the boom in corporate jets).

Like power, it is the half on / half off method of regulation that is killing everything and propelling the elite to find their own solutions. You won’t see them in line in front of you at O’Hare or waiting forlornly at the baggage carousel, unless they have no other options.

The primary capacity limit in aviation is a very concrete one–concrete in a literal way, as in runways and taxiways. Total government ownership of all airports would not solve this problem unless it came in the form of strong legislation (probably requiring a Constitutional amendment) preventing all interference with expansion in the form of environmental lawsuits, etc.

As far as why the “deregulation” failed, I agree that a lack of price signals was one element – but another element was that there was no incentive (or even mechanism) to build new generation, and those that had existing generation PROFITED from this situation. I am not disagreeing with your point, just adding to its merits.

I was involved heavily in the power industry for over a decade and California was a singular example of its failure. Montana, the birth place of my mother, also got wrecked, too.

California’s electricity deregulation is a textbook example. California deregulated the production of electricity and let produces and distributors buy in an open market but they continued to regulate the price that consumers paid. The result: Consumers never received the price feedback loop that electricity was in short supply so they continued to consume at previous levels even as supply shrank until the system collapsed.

We have a similar problem nation wide with transmission assets. We still socialize those cost but we’ve severed the feedback loop that routes resources into creating that infrastructure. The result: no one will invest in transmission and the system is decaying.

We need to get off the fence. Either we need to create complete and integral market systems or we need to return to the politically managed model. Keeping halfway between will kill us.

1)I’m not sure it’s a new thing for elites to often have more affinity with other elites than with the masses in their own countries…it’s likely that many cases of this could be found in the history of the European aristocracies.

2)I’m particularly concerned about the nexus between electricity and water. In the U.S. at least, almost all water pumping seems to be done electrically, and I believe backup power is rare. A power outage of some length (hours? days?) can be ridden through with water from the gravity tanks, but once they’re empty…

A city without electricity for a week would be a pretty grim sight…one without water for a week would be much grimmer.

I agree that the global elite is a common theme in science fiction… what I haven’t seen is how our systematic disinvestment in infrastructure is contributing to them walling themselves off.

As far as price limits and such, they are not working because you can’t tax an industry that is fundamentally broken. I agree that regulation is part of the process but it doesn’t help in the long term with industries like power that require continuous investment and the public will to force some to have discomforts (live near transmission lines) for the benefit of others.

The emergence of a global elite is a common theme in science fiction/cyberpunk.

The people that travel between these worlds have more in common with the huddled masses in their own countries (regardless of origin), and over time their attitudes will likely become more and more similar as they disengage from the world.

I think you need to clean up that sentence, at first glance it seems to be saying the opposite of what you mean to be saying.