The President has just given away the contents of half the nation’s wallets by arranging things so that the survival of the other half depend on getting it.
Economics & Finance
Powering Down
The California Water Resources Board has ruled that 19 natural gas power plants, located in coastal areas, are in violation of the Clean Water Act for using a technique called “once-through cooling.” According to this article, it appears that this ruling will result in the shutdown of most of these plants.
(Once-through cooling, which has been used since the days of James Watt, means simply that water is used to condense steam and is thence returned to the source from whence it came. The cooling water is not polluted, but is warmed up a bit. IIRC, the returned cooling water is somewhere in the range of 85-90 degrees F, i.e., less than the temperature of the typical hot tub.)
The state of California has taken other actions which make it difficult for the capacity of these 19 plants to be replaced. California has a moratorium on new nuclear power plants and coal plants. New natural gas plants, which are less polluting than coal plants (and emit less CO2, for those who care about this issue) are also banned in much of California.
A project to build large-scale solar plants in the Mojave Desert is encountering opposition from environmentalists who object to the construction of transmission lines to carry the power to San Diego. And California Senator Dianne Feinstein is apparently also opposed to this solar project on grounds that it threatens a species of turtle. There is also environmentalist objection to wind turbines because of the danger they pose to birds and bats.
If you live in California, expect your electricity bills to rise significantly. If you run an energy-intensive business located in that state, you probably need to think about alternative locations.
Although unfortunately, these California polities are merely the currently-most-extreme version of the policies that the Democratic Party, in its war on energy, wants to impose on the country as a whole.
The only possibility we as a nation have to overcome our very serious debt problems and to restore anything like full employment is to grow our way out of the problem. The Democrats’ war on energy is one of the primary threats to such growth.
Worthwhile Reading and Viewing
(Every week or so, I post a collection of interesting links at Photon Courier under the above heading. There’s so much interesting stuff this week I thought I’d post it here as well)
Erin O’Connor on California’s universities and their role in the state’s economic debacle.
Climategate: it was an academic disaster waiting to happen. Interesting and contrarian thoughts about the role of peer review.
Richard Fernandez wonders if World War III has already started…without many people even noticing. (via Isegoria)
Solar arbitrage in Germany. (via Maggie’s Farm) It’s hard to believe he will really get away with this, but still pretty funny. See also this related post from Evolving Excellence: Better Call the Waaaahmulance!
AnoukAnge writes about ambition. (One of the great literary works that deals with this subject is Goethe’s Faust…memo to self: a blog post on the treatment of ambition within Faust could be very interesting)
AnoukAnge also has a nice photographic essay on color…including the psychological connotations and cultural-symbolic meanings of various colors.
Speaking of color, this year’s winning images have been chosen for GE’s In Cell Analyzer photography contest. The In Cell system used used by scientists for better understanding disease processes and for drug development; as it happens, it also produces images which are appealing and even beautiful, in a psychedelic sort of way. There’s a nice video, with music, at the bottom of GE’s post about the contest.
One more photography-related link: British industry in the 1950s and 1960s. (via Brian Gongol)
Subsidy Farming
This is the kind of thing that happens when governments distort market incentives.
The above-market prices, called feed-in tariffs because panel owners feed power into the grid at premium prices guaranteed for decades, are high enough in Italy to generate average revenue of 35 euros ($48) a day for a 100-square-meter (1,076-square-foot) roof, according to Bloomberg calculations.
“The feed-in tariff drives our business plan and profitability,” said de Vergnies, whose plans include two photovoltaic plants in southern Italy that will generate enough electricity for 25,000 homes.
The gist:
The solar industry is “built on subsidies,” said James Britland, an alternative energy analyst at Allianz RCM in London. “This is a non-competitive industry that has to be subsidized.”
The investment capital that’s diverted by taxes into subsidies for politically-correct tech fads, and by investors themselves in response to the distorted incentives created by such subsidies, is capital that doesn’t get invested in productive ventures in biotech, medical devices, etc., etc. Keep this fact in mind the next time you or someone you know needs advanced medical treatment. Those chemotherapy agents and other wonder drugs don’t invent themselves. Fewer of them get invented to the extent we allow our reckless political class to divert precious capital to unproductive solar-energy schemes and other financial sinkholes.
The Sacred Fools of the Market Economy
Tim Cavanaugh at Reason, observes that the peak of the dot-dom bubble was reached ten years ago today. The dot-com bubble and other technology bubbles are often held out as examples of the irrational nature of market economies by those who think they could do a better job of running the planetary economy than the rest of us can.
This is myth. Booms and busts represent two equal and necessary phases of technological development. A bust looks ugly but so does the birth of child. The busts are every bit as necessary as the booms and every bit as good for the general society and economy.