By Evelyn Black, on July 25th, 2008
On July 8, oilman T. Boone Pickens launched a personal initiative to promote wind power as a primary renewable energy source for the United States. Pickens wants the next U.S. president to lead the nation to 20% wind power by 2018 by tapping a “wind corridor” that runs from the Northern Midwest all the way through Texas. Pickens himself has invested in wind energy in Texas.
Why would an oilman take on this kind of public environmental project?
A better question is, why wouldn’t Big Oil take on this kind of project? It’s clear that alternative and renewable energy is a big part of America’s future, and oil is already fast becoming a much smaller part. Pickens points out at his website PickensPlan that in 1970 the U.S. imported 24% of its oil; now we import nearly 70%. This dependence on foreign oil, while lucrative in the short term for the oil companies, has resulted in the greatest outflow of money from the U.S. to the rest of the world in history.
Though most of our oil is imported from Canada, much of this lost U.S. wealth is flowing to nations with which we have very troubled relations: Iran, Iraq, Saudi Arabia, and Venezuela. The painful result is that the U.S. economy is currently experiencing a contraction the like of which has not been seen since the Great Depression. When a country has to import its most basic energy resource at great cost, that country is in trouble economically. We cannot compete effectively in a global economy when we have to spend that much money just to get a business running. We are rapidly losing ground on the world stage.
While Big Oil may have made some big short term profits in recent years, those profits have greatly lowered the average American’s standard of living. They have destroyed any kind of positive feeling consumers might have ever had toward Big Oil. How many people do you know (outside of actual oil company employees) who do not hate the oil companies? No ad campaign showing waving fields of corn and pristine oceans can counteract the rancor that currently exists in the hearts of most Americans for Big Oil.
Poverty is radical; wealth is conservative. No one changes course while being deluged with money. So it’s not surprising that innovation is not exactly the middle name of the CEOs who lead successful corporations, unless they happen to be working in the field of information technology, where innovation basically is the product. Most other corporations just hire big publicity departments to spin what is already working to make it palatable to the public at large. In fact, if the corporations are doing well enough, they don’t even care that much about the consumer; they care about the stockholders.
But one thing big corporations do understand is profit. CEOs understand it keeps them in their overpaid jobs. Stockholders understand that it makes them money.
As the graphic above shows, the U.S. is, Pickens puts it, “The Saudi Arabia of Wind Power.”
All we have to do is invest in infrastructure to tap that power.
Big Oil can stay on its current course, winning the enmity of the world and destroying the environment and the political peace, or it can lead the way to energy independence and thereby nearly monopolize the profits that will come from renewable technologies. Wind and solar are often pooh-poohed because they take significant initial investment before they pay off. But so does oil. Without refineries, crude oil is nearly worthless, and we have not built any new oil refineries for over 30 years because of the huge cost.
Instead of investing even more money in oil, why not invest it in renewable energy? When corporations start to see the potential for profit in these technologies, no amount of Congressional oversight and bumbling will be able to stop corporate investment in them. We won’t be looking for ways to promote renewable energy, we’ll be looking at anti-trust laws to make sure the profits are being properly shared amongst the prospective players.
Pickens will no doubt be the butt of much cynical critique from pundits who note the potential for big profits down the line for Pickens. So what? The market works or it doesn’t. Right now it is working by showing us corporate failure after failure; profits without product, policies so self-serving and harsh they’d be despicable even if they worked. But they don’t work!
Big Oil should back renewable energy because it works, because the potential for profit is enormous, because it is what the future has in store for us if we do not fail entirely. They will want to be on the cutting edge, not left behind. Forward thinking is not their strong suit. But we’re only talking ten years forward here.
Even I know how to make a ten year plan. My job at a regional bank is pretty shaky right now. Anybody out there need a renewable energy CEO?
By Stephan Zimmermann, on July 25th, 2008
For more than a hundred fifty years, economics has been feared by students, lay people and economists themselves. Not the least source of this fear has been the fact that economics has been labeled as “the dismal science.” The study of economics has been living with its moniker ever since English philosopher Thomas Carlyle ascribed the incorrect predictions of Robert Thomas Malthus concerning overpopulation and the eventual lack of the world’s food as “dreary, stolid, dismal, without hope for this world or the next.”
Malthus’ fears ultimately were far from justified. Technology and science in the intervening century more than solved worldwide starvation. Unfortunately, economics remains the “dismal science” to this day. Harvard’s Walter S. Barker Professor of Economics recently released his book The Dismal Science: How Thinking Like An Economist Undermines Community. The book not only repeats the unfair moniker but misses the point made by thousands of economists, which ultimately leads novices to shy away from the study of economics in general.
The problem lies largely in the assumption that economics is a “science” just like biology or basic logic. It’s not. Economics is just another method of trying to solve the age-old question of what, how and to whom to distribute finite resources. As such, economics is just as much subject to debate as psychology.
The Science of Assumptions
Ever since Adam Smith, the foundations of economics have been presented as scientific fact. The facts presented as economics are really two: an assumption regarding the nature of man as well as a strict belief and usage of logic. Unless someone can show an alternative to thousands of years of developed logic based on fact, we should be able to live with that assumption. More difficult, of course, and subject to endless debate is the assumption regarding the nature of mankind.
Unfortunately, most beginning studies in economics merely accept without questioning the classical economist’s assumption that mankind is greedy and selfish or wants mainly material things. Whether true or not, without stating or questioning that assumption, economic studies immediately delve into the mathematics of graphs and charts and formulas. Some even create the impression that the movement up and down a curve or graph actually makes the economy move! Nothing could be more absurd.
For whatever reason, only a few simple paragraphs and no more might be devoted in a textbook to logic and fallacies in thinking. Some beginners in economics might readily recognize the confusion between facts or values. It is, however, much easier to settle back, comfortable in accepted beliefs, rather than learn why those beliefs first developed. Nearly everyone can recognize the post hoc, ergo propter hoc syndrome, or the difference between “positive” and “normative” economics, after one or two courses in economics. But even professional economists quickly fall into the trap of simple assumptions regarding the nature of man.
Dialogue vs. Mathematics
Perhaps it would dispel once and for all the notion of a “dismal” science if we divided basic economics into two: a discussion of mankind’s nature in its non-quantifiable form as well as a strict mathematical quantification of material things based on fact.
At the graduate level, the latter is known as econometrics. That study, of course, already assumes that you have a reasonable outlook on the nature of mankind through psychology, politics, sociology or religion. Econometrics should be especially suited for those with a mathematical bent rather than those who prefer to focus on lengthy philosophical discussions.
The key for all these “soft sciences” – including economics as we practice it – is that they are all subject to change with the current vogue. Was Karl Marx writing essentially about economics or a solution to political problems? Although basic logic has propelled western civilization forward since the Age of Reason, other societies have chosen different routes, especially in value systems.
Most of economics really depends on a “positive” rather than a “normative” assessment of society’s problems. Whether government or private individuals should make the crucial decisions about resources is virtually irrelevant. It is more a question of politics. The major concern depends on your own view. The questions are the same, as are the quantifiable economic answers.
Economics can be fun, especially when one can illustrate and question the nature of mankind through examples of watching people’s behavior at a local Wal-Mart on a given day.
Too many would-be economists in graduate school or beyond may never really have had asked themselves about the fundamental nature of man.
Once we understand and accept the essentials of mankind, bolstered with valid facts, we should be able to look at the “dismal science” with a much brighter perspective.
By Jennifer Bunn, on July 25th, 2008
There has been much written and spoken recently about antibiotic resistant organisms, nosocomial infections, and the rise in the incidence of these. MRSA (Methicillin Resistant Staph Aureus), VRE (Vancomycin Resistant Enterrococcus) and other infections like Clostridium Difficile have been increasing in alarming numbers, leading to rising costs in caring for the patients infected by these “super bugs” and numerous patient deaths. Nosocomial infections account for approximately 20,000 deaths each year, and about 1 in 10 American hospital patients can expect to get a hospital-acquired infection each year.
In hospitals all over the country, patients routinely share rooms with one or more other patients, a practice that is proving deadly. They also share nurses, and all too often there are not enough of them to go around.
Evidence has shown that the number of people infected by these bugs can be greatly diminished in two ways: First, by every patient having their own room with their own bathrooms, and secondly, by having enough nurses available so that uninfected patients are not cared for by nurses who have been caring for infected patients. Additionally, having enough nurses available helps in infection control measures, as nurses are often the ones who implement these measures.
If this is known, why is more not being done? Although the cost of revamping currently existing hospitals to make all the rooms private would be astronomical, so is the cost of caring for the 10% of patients who require extended hospital stays because they contracted a nosocomial infection in the very place that was to help them get well. And we cannot discount the 20,000 deaths caused by these infections each year.
In at least 42 states, efforts are underway to counteract the problem. The American Institute of Architects has called for 100% private rooms as the minimum standard for some units in general hospitals in their document “Guidelines for Design and Construction of Health Care Facilities.”
This is definitely a step in the right direction, and it is likely that the remaining states that have not adopted these guidelines will do so, as people become more aware and concerned about this issue.
Source:
Nicholas Kohler, (2008). Death Traps. Maclean’s. p.40
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