Business

Several days ago, I posted about an improved variant of sugarcane, designed for use as a fuel and developed by Barbados. The post also discussed the irrationality of the 54-cent-per-gallon tariff that the US currently imposes on imports of ethanol.

Today’s Wall Street Journal has an editorial “What’s Wrong with Free Trade in Biofuels?” which amplifies the point. Excerpt:

Brazil has already established itself a low-cost producer of cane-based ethanol churned out in large volume at the oil-equivalent price of $25 a barrel without any heroic biogenetics involved. Its example is already inspiring copycat behavior by other Latin, Caribbean, African and South Asian countries, with similar conditions that make them potentially prolific exporters of biofuels.

Take the pressure for flex-fuel mandates, requiring auto companies to build cars capable of running on 85% ethanol. Unmodified cars can already burn fuel comprised 10% of ethanol. If we were honestly keen on diversifying supply and squeezing out imported oil, we’d throw open our dense coastal markets to ethanol producers in Brazil, India, Pakistan, Nigeria and Thailand, displacing perhaps 10 billion gallons of current gasoline use without any vehicle modification or taxpayer subsidy at all.

I don’t think the $25/bbl number for Brazilian cane-based ethanol is right; at least it’s not consistent with the $.87/gallon number quoted in the Farm Bureau article (linked from my earlier post)…but even with the $.87/gallon number (cost after ocean shipping charges $1.01/gallon) and considering the lesser energy in a gallon of ethanol vs a gallon of gasoline, the cane-based ethanol sounds like a winner. The tariff should go.

…I guess you could call it a “blog,” but with some interesting twists: Jotzel is intended to provide a forum for business news and business-related discussions. Any registered member can submit a post, but it will be activated only when a sufficient number of other registered members vote positively on it. It’s kind of like a blog carnival, but with continuous rather than periodic posting, and with distributed rather than centralized administration. I think it has a lot of potential if it can achieve a critical mass of participants.

Incognito sent me a link to this article, with the comment: “‘don’t be evil’ went out the window pretty fast eh?”

He got that right.

Naturally Google management rationalizes its cooperation with the Chinese police state as being for the greater good, but I don’t get this as a business decision. Imagine how much good will they could have bought with their other customers by telling the commies to take a hike. I think it might have been good for business in the long run, a force multiplier. As a first-line tech company the example they could have set might have done a lot of good for everyone by showing that it is possible to say no. (How many big companies would have to say no before the Chinese government blinked? Maybe not so many.)

Google’s Achilles heel is its founders’ hubris. Some of the company’s products override customers’ hierarchies in an attempt to impose Google’s search algorithm as the best solution to all problems. (See here for my own complaints.) These are the guys who bought a Boeing jet for personal use and rationalized it as a business decision. It’s their money, and maybe the purchase made sense on the numbers, but they should have known how it was going to play as PR. Or maybe they knew and didn’t care. In the perfect world there would be no penalty for attitude, but in the real world Google is vulnerable to political assaults, and it might not hurt the company to have a rep for principled, pro-freedom behavior. As it is they come across as just another bunch of driven, amoral business cynics, which is, perhaps not coincidentally, how Bill Gates was widely perceived before he got into trouble with the government.

UPDATE: Some of the reactions to Google’s behavior remind me of the Smith & Wesson boycott. The Google situation is different, because some of Google’s competitors, such as Yahoo! and Microsoft, seem to be acting at least as unscrupulously as Google is, but some of the anti-Google sentiments seem remarkably similar to those once expressed about S&W.

UPDATE 2: That didn’t take long. Here’s a report on What Google censors in China that compares Google’s search results with those of its chief competitors.

A person with a liberal arts degree is a fool to think it is a key to anything in the business world. Most of the people I knew saw those classes as an end in themselves, not a means to some kind of appointment. (If we wanted to do that, we could have gotten education degrees, which were a lot easier but which required listening to more bullshit.)

This morning when I first saw the discussion of “overeducation”, I thought, how stupid. I’ve always felt people who thought that way were unwilling to actually enter the fray, get their hands dirty. And I thought about how often I met people who became my friends on Kelly Girl jobs – a group of us standing around a table, collating bits of paper or jamming phone directories into bags for mailing or typing up a grant report in a boiler room of typists. Often, most of the group had at least one degree and some were working on their third ones. My daughter, ABD in a rather demanding field, has taken some jobs like that in the last couple of years. They have broadened her understanding, taken her into offices she might never have entered otherwise.

Read more

While I was growing up, my parents often remarked on the role of a small town banker. His was a job that needed honesty & good judgment. In the depression, our local banker stuck it out, losing his own money. The piano lessons I took in their family parlor didn’t teach me much, but their tenacity did. In some areas, bankers were stingy about loaning money for irrigation – we were close to the Platte so wells didn’t need to be terribly deep (nor terribly expensive). Still, our village was relatively prosperous because those loans were forthcoming from later owners of that local bank. [In Texas] still later, in my copy shop, one of our best customers testified before the state board that new bank after bank would prosper. This was during the early eighties oil boom; he made his consulting money (and paid his printer). However, as the decade moved on, so did the landmen. Those banks, one by one, closed. Balance, good judgment, foresight – these aren’t all that easy.

Read more