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| Monday February 08 |
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[7:33 am] Why America Is Depressed
Paul Krugman receiving his Prize from His Majesty King Karl XVI Gustaf of Sweden at the Stockholm Concert Hall, December 10, 2008
Photo by Hans Mehlin for The Nobel Foundation
The world is full of obvious things which nobody by any chance ever observes.
---Arthur Conan Doyle
People who lean on logic and philosophy and rational exposition end by starving the best part of their minds.
---W.B. Yeats
To the mind that is still, the whole universe surrenders.
---Taoist saying
I don't mean economic depression. Let the scholars argue about the difference between recession and depression. Do there have to be bread lines and dustbowl photos before we all get grim? The title is about emotional depression. Sarah may smile at her Tea Party and Saints fans may shout in New Orleans streets, but that doesn't mean something still isn't eating away at them.
Dr. Harriet Fraad is a practicing psychotherapist-hypnotherapist in Manhattan. Currently an article she published last month in Tikkun is being cross-posted all over the Internet. It's called American Depressions and can be read here http://www.tikkun.org/article.php?story=jan10_depressions. If it impresses or moves you, it may be of interest that you can talk or just listen to Dr. Fraad about her article in a phone forum this very evening, January 8, 2010. At 6 pm Pacific time, 9 pm Eastern time, call 1 888 346 3950 and ENTER CODE 11978#. There is no phone charge to you, but someone will ask you to subscribe or contribute.
So what does all this have to do with the picture of Paul Krugman up there? Just prior to being notified he was being presented with a Nobel in economics, Princeton Professor Krugman had agreed to write an open letter to Barack Obama for Rolling Stone. As the deadline was drawing near, the editors called Krugman to remind him...and that's when they found out he was sorry but he had to fly to Stockholm. He ended up writing most of it on the plane during the flight. The open letter appeared in Issue 1070 a little over a year ago, pretty much as Bush was leaving and Obama was inaugurated. Midst all the excitement, do you suppose Obama ever read it?
A year later, Barack Obama would be flying to Stockholm too. It would have been nice if he had spent the flight time writing a reply to Paul Krugman, listing the advice he had taken and what he hadn't and why. But instead he had to polish a controversial acceptance address for his Peace Prize. Too bad. Some of us get depressed when the elected representatives of this republic don't do what they promised they would and don't listen to our views.
I agree America is emotionally depressed. I think the reasons Dr. Fraad describes are correct. Many therapists believe the way to get over it, short of electroshock, is to pave a highway into the future and move forward. I'm more from the school of understanding the past so I don't repeat it. As a result I invite you to read Paul Krugman's letter to President Obama and see if it helps. Sometimes a cure involves pain, but it's probably worth it.
What Obama Must Do
A Letter to the New President
PAUL KRUGMAN
Posted Jan 14, 2009 12:17 PM
Dear Mr. President:
Like FDR three-quarters of a century ago, you're taking charge at a moment when all the old certainties have vanished, all the conventional wisdom been proved wrong. We're not living in a world you or anyone else expected to see. Many presidents have to deal with crises, but very few have been forced to deal from Day One with a crisis on the scale America now faces.
So, what should you do?
In this letter I won't try to offer advice about everything. For the most part I'll stick to economics, or matters that bear on economics. I'll also focus on things I think you can or should achieve in your first year in office. The extent to which your administration succeeds or fails will depend, to a large extent, on what happens in the first year and above all, on whether you manage to get a grip on the current economic crisis.
The Economic Crisis
How bad is the economic outlook? Worse than almost anyone imagined.
The economic growth of the Bush years, such as it was, was fueled by an explosion of private debt; now credit markets are in disarray, businesses and consumers are pulling back and the economy is in free-fall. What we're facing, in essence, is a yawning job gap. The U.S. economy needs to add more than a million jobs a year just to keep up with a growing population. Even before the crisis, job growth under Bush averaged only 800,000 a year and over the past year, instead of gaining a million-plus jobs, we lost 2 million. Today we're continuing to lose jobs at the rate of a half million a month.
There's nothing in either the data or the underlying situation to suggest that the plunge in employment will slow anytime soon, which means that by late this year we could be 10 million or more jobs short of where we should be. This, in turn, would mean an unemployment rate of more than nine percent. Add in those who aren't counted in the standard rate because they've given up looking for work, plus those forced to take part-time jobs when they want to work full-time, and we're probably looking at a real-world unemployment rate of around 15 percent more than 20 million Americans frustrated in their efforts to find work.
The human cost of a slump that severe would be enormous. The Center on Budget and Policy Priorities, a nonpartisan research group that analyzes government programs, recently estimated the effects of a rise in the unemployment rate to nine percent a worst-case scenario that now seems all too likely. So what will happen if unemployment rises to nine percent or more? As many as 10 million middle-class Americans would be pushed into poverty, and another 6 million would be pushed into "deep poverty," the severe deprivation that happens when your income is less than half the poverty level. Many of the Americans losing their jobs would lose their health insurance too, worsening the already grim state of U.S. health care and crowding emergency rooms with those who have nowhere else to go. Meanwhile, millions more Americans would lose their homes. State and local governments, deprived of much of their revenue, would have to cut back on even the most essential services.
If things continue on their current trajectory, Mr. President, we will soon be facing a great national catastrophe. And it's your job a job no other president has had to do since World War II to head off that catastrophe.
Wait a second, you may say. Didn't other presidents also face troubled economies? Yes, they did but when it came to economic policy, your predecessors weren't actually running the show. For the past half century the Federal Reserve a more or less independent institution, run by technocrats and deliberately designed to be independent of whoever happens to occupy the White House has been taking care of day-to-day, and even year-to-year, economic management. Your fellow presidents were just along for the ride.
Remember the economic boom of 1984, which let Ronald Reagan run on the slogan "It's morning again in America"? Well, Reagan had absolutely nothing to do with that boom. It was, instead, the work of Paul Volcker, whom Jimmy Carter appointed as chairman of the Federal Reserve Board in 1979 (and who's now the head of your economic advisory panel). First Volcker broke the back of inflation, at the cost of a recession that probably doomed Carter's re-election chances in 1980. Then Volcker engineered an economic bounce-back. In effect, Reagan dressed up in a flight suit and pretended to be a hotshot economic pilot, but Volcker was the guy who actually flew the plane and landed it safely.
You, on the other hand, have to pull this plane out of its nose dive yourself, because the Fed has lost its mojo.
Compare the situation right now with the one back in the 1980s, when Volcker turned the economy around. All the Fed had to do back then was print a bunch of dollars (OK, it actually credited the money to the accounts of private banks, but it amounts to the same thing) and then use those dollars to buy up U.S. government debt. This drove interest rates down: When Volcker decided that the economy needed a pick-me-up, he was quickly able to drive the interest rate on Treasury bills from 13 percent down to eight percent. Lower interest rates on government debt, in turn, quickly drove down rates on mortgages and business borrowing. People started spending again, and within a few months the economy had gone from slump to boom. Economists call this process from the Fed's decision to print more money to the resulting pickup in spending, jobs and incomes the "monetary transmission mechanism." And in the 1980s that mechanism worked just fine.
This time, however, the transmission mechanism is broken.
First of all, while the Fed can still print money, it can't drive interest rates down. Why? Because those interest rates are already about as low as they can go. As I write this letter, the interest rate on Treasury bills is 0.005 percent that is, zero. And you can't push rates lower than that. Now, you might think that zero interest rates would lead to an orgy of borrowing. But while the U.S. government can borrow money for free, the rest of us can't. Fear rules the financial markets, so over the past year and a half, as the interest rates on government debt have plunged, the interest rates that Main Street has to pay have mostly gone up. In particular, many businesses are paying much higher interest rates now than they were a year and a half ago, before the Fed started cutting. And they're lucky compared to the many businesses that can't get credit at all.
Besides, even if more people could borrow, would they really want to spend? There's a glut of unsold homes on the market, so there's very little incentive to build more houses, no matter how low mortgage rates go. The same goes for business investment: With office buildings standing empty, shopping malls begging for tenants and factories sitting idle, who wants to spend on new capacity? And with workers everywhere worried about job security, people trying to save a few dollars may stampede into stores that offer deep discounts, but not many people want to buy the big-ticket items, like cars, that normally fuel an economic recovery.
So as I said, the Fed has lost its mojo. Ben Bernanke and his colleagues are trying everything they can think of to unfreeze the credit markets the alphabet soup of new "lending facilities," with acronyms nobody can remember, is growing by the hour. Any day now, the joke goes, everyone will have a Visa card bearing the Fed logo. But at best, all this activity only serves to limit the damage. There's no realistic prospect that the Fed can pull the economy out of its nose dive.
So it's up to you.
Rescuing The Economy
The last president to face a similar mess was Franklin Delano Roosevelt, and you can learn a lot from his example. That doesn't mean, however, that you should do everything FDR did. On the contrary, you have to take care to emulate his successes, but avoid repeating his mistakes.
About those successes: The way FDR dealt with his own era's financial mess offers a very good model. Then, as now, the government had to deploy taxpayer money in order to rescue the financial system. In particular, the Reconstruction Finance Corporation initially played a role similar to that of the Bush administration's Troubled Assets Relief Program (the $700 billion program everyone knows about). Like the TARP, the RFC bulked up the cash position of troubled banks by using public funds to buy up stock in those banks.
There was, however, a big difference between FDR's approach to taxpayer-subsidized financial rescue and that of the Bush administration: Namely, FDR wasn't shy about demanding that the public's money be used to serve the public good. By 1935 the U.S. government owned about a third of the banking system, and the Roosevelt administration used that ownership stake to insist that banks actually help the economy, pressuring them to lend out the money they were getting from Washington. Beyond that, the New Deal went out and lent a lot of money directly to businesses, to home buyers and to people who already owned homes, helping them restructure their mortgages so they could stay in their houses.
Can you do anything like that today? Yes, you can. The Bush administration may have refused to attach any strings to the aid it has provided to financial firms, but you can change all that. If banks need federal funds to survive, provide them but demand that the banks do their part by lending those funds out to the rest of the economy. Provide more help to homeowners. Use Fannie Mae and Freddie Mac, the home-lending agencies, to pass the government's low borrowing costs on to qualified home buyers. (Fannie and Freddie were seized by federal regulators in September, but the Bush administration, bizarrely, has kept their borrowing costs high by refusing to declare that their bonds are backed by the full faith and credit of the taxpayer.)
Conservatives will accuse you of nationalizing the financial system, and some will call you a Marxist. (It happens to me all the time.) And the truth is that you will, in a way, be engaging in temporary nationalization. But that's OK: In the long run we don't want the government running financial institutions, but for now we need to do whatever it takes to get credit flowing again.
All of this will help but not enough. By all means you should try to fix the problems of banks and other financial institutions. But to pull the economy out of its slide, you need to go beyond funneling money to banks and other financial institutions. You need to give the real economy of work and wages a boost. In other words, you have to get job creation right which FDR never did.
This may sound like a strange thing to say. After all, what we remember from the 1930s is the Works Progress Administration, which at its peak employed millions of Americans building roads, schools and dams. But the New Deal's job-creation programs, while they certainly helped, were neither big enough nor sustained enough to end the Great Depression. When the economy is deeply depressed, you have to put normal concerns about budget deficits aside; FDR never managed to do that. As a result, he was too cautious: The boost he gave the economy between 1933 and 1936 was enough to get unemployment down, but not back to pre-Depression levels. And in 1937 he let the deficit worriers get to him: Even though the economy was still weak, he let himself be talked into slashing spending while raising taxes. This led to a severe recession that undid much of the progress the economy had made to that point. It took the giant public works project known as World War II a project that finally silenced the penny pinchers to bring the Depression to an end.
The lesson from FDR's limited success on the employment front, then, is that you have to be really bold in your job-creation plans. Basically, businesses and consumers are cutting way back on spending, leaving the economy with a huge shortfall in demand, which will lead to a huge fall in employment unless you stop it. To stop it, however, you have to spend enough to fill the hole left by the private sector's retrenchment.
How much spending are we talking about? You might want to be seated before you read this. OK, here goes: "Full employment" means a jobless rate of five percent at most, and probably less. Meanwhile, we're currently on a trajectory that will push the unemployment rate to nine percent or more. Even the most optimistic estimates suggest that it takes at least $200 billion a year in government spending to cut the unemployment rate by one percentage point. Do the math: You probably have to spend $800 billion a year to achieve a full economic recovery. Anything less than $500 billion a year will be much too little to produce an economic turnaround.
Spending on that scale, at a time when the weakening economy is driving down tax collection, will produce some really scary deficit numbers. But the consequences of too much caution of a failure on your part to do enough to stop the economy's nose dive will be even scarier than the coming ocean of red ink.
In fact, the biggest problem you're going to face as you try to rescue the economy will be finding enough job-creation projects that can be started quickly. Traditional WPA-type programs spending on roads, government buildings, ports and other infrastructure are a very effective tool for creating employment. But America probably has less than $150 billion worth of such projects that are "shovel-ready" right now, projects that can be started in six months or less. So you'll have to be creative: You'll have to find lots of other ways to push funds into the economy.
As much as possible, you should spend on things of lasting value, things that, like roads and bridges, will make us a richer nation. Upgrade the infrastructure behind the Internet; upgrade the electrical grid; improve information technology in the health care sector, a crucial part of any health care reform. Provide aid to state and local governments, to prevent them from cutting investment spending at precisely the wrong moment. And remember, as you do this, that all this spending does double duty: It serves the future, but it also helps in the present, by providing jobs and income to offset the slump.
You can also do well by doing good. The Americans hit hardest by the slump the long-term unemployed, families without health insurance are also the Americans most likely to spend any aid they receive, and thereby help sustain the economy as a whole. So aid to the distressed enhanced unemployment insurance, food stamps, health-insurance subsidies is both the fair thing to do and a desirable part of your short-term economic plan.
Even if you do all this, however, it won't be enough to offset the awesome slump in private spending. So yes, it also makes sense to cut taxes on a temporary basis. The tax cuts should go primarily to lower- and middle-income Americans again, both because that's the fair thing to do, and because they're more likely to spend their windfall than the affluent. The tax break for working families you outlined in your campaign plan looks like a reasonable vehicle.
But let's be clear: Tax cuts are not the tool of choice for fighting an economic slump. For one thing, they deliver less bang for the buck than infrastructure spending, because there's no guarantee that consumers will spend their tax cuts or rebates. As a result, it probably takes more than $300 billion of tax cuts, compared with $200 billion of public works, to shave a point off the unemployment rate. Furthermore, in the long run you're going to need more tax revenue, not less, to pay for health care reform. So tax cuts shouldn't be the core of your economic recovery program. They should, instead, be a way to "bulk up" your job-creation program, which otherwise won't be big enough.
Now my honest opinion is that even with all this, you won't be able to prevent 2009 from being a very bad year. If you manage to keep the unemployment rate from going above eight percent, I'll consider that a major success. But by 2010 you should be able to have the economy on the road to recovery. What should you do to prepare for that recovery?
Beyond the Crisis
Crisis management is one thing, but America needs much more than that. FDR rebuilt America not just by getting us through depression and war, but by making us a more just and secure society. On one side, he created social-insurance programs, above all Social Security, that protect working Americans to this day. On the other, he oversaw the creation of a much more equal economy, creating a middle-class society that lasted for decades, until conservative economic policies ushered in the new age of inequality that prevails today. You have a chance to emulate FDR's achievements, and the ultimate judgment on your presidency will rest on whether you seize that chance.
The biggest, most important legacy you can leave to the nation will be to give us, finally, what every other advanced nation already has: guaranteed health care for all our citizens. The current crisis has given us an object lesson in the need for universal health care, in two ways. It has highlighted the vulnerability of Americans whose health insurance is tied to jobs that can so easily disappear. And it has made it clear that our current system is bad for business, too the Big Three automakers wouldn't be in nearly as much trouble if they weren't trying to pay the medical bills of their former employees as well as their current workers. You have a mandate for change; the economic crisis has shown just how much the system needs change. So now is the time to pass legislation establishing a system that covers everyone.
What should this system look like? Some progressives insist that we should move immediately to a single-payer system Medicare for all. Although this would be both the fairest and most efficient way to ensure that all Americans get the health care they need, let's be frank: Single-payer probably isn't politically achievable right now, simply because it would represent too great a change. At least at first, Americans who have good private health insurance will be reluctant to trade that insurance for a public program, even if that program will ultimately prove better.
So the thing to do in your first year in office is pass a compromise plan one that establishes, for the first time, the principle of universal access to care. Your campaign proposals provide the blueprint. Let people keep their private insurance if they choose, subsidize insurance for lower-income families, require that all children be covered, and give everyone the option to buy into a public plan one that will probably end up being cheaper and better than private insurance. Pass legislation doing all that, and we'll have universal health coverage up and running by the end of your first term. And that will be an achievement that, like FDR's creation of Social Security, will permanently change America for the better.
All this will cost money, mainly to pay for those insurance subsidies, and some people will tell you that the nation can't afford major health care reform given the costs of the economic recovery program. Let's talk about why you should ignore the naysayers.
First, let's put the costs of the economic-recovery program in perspective. It's possible that reviving the economy might cost as much as a trillion dollars over the course of your first term. But the Bush administration wasted at least twice that much on an unnecessary war and tax cuts for the wealthiest; the recovery plan will be intense but temporary, and won't place all that much burden on future budgets. Put it this way: With long-term federal debt paying the lowest interest rates in half a century, the interest costs on a trillion dollars in new debt will amount to only $30 billion a year, about 1.2 percent of the current federal budget.
Second, there's good reason to believe that health care reform will save money in the long run. Our system isn't just full of holes in coverage, it's also grossly inefficient, with huge bureaucratic costs such as the immense resources that insurance companies devote to making sure they don't cover the people who need health care the most. And under a universal system it will be much easier to use our health care dollars wisely, to spend money only on medical procedures that work and not on those that don't. Since rising health care costs are the main source of the grim, long-run projections for the federal budget, the truth is that we can't afford not to move forward on health care reform.
And let's not ignore the long-term political effects. Back in 1993, when the Clintons tried and failed to create a universal health care system, Republican strategists like William Kristol (now my colleague at The New York Times) urged their party to oppose any reform on political grounds; they argued that a successful health care program, by conveying the message that government can actually serve the public interest, would fundamentally shift American politics in a progressive direction. They were right and the same considerations that made conservatives so opposed to health care reform should make you determined to make it happen.
Universal health care, then, should be your biggest priority after rescuing the economy. Providing coverage for all Americans can be for your administration what Social Security was for the New Deal. But the New Deal achieved something else: It made America a middle-class society. Under FDR, America went through what labor historians call the Great Compression, a dramatic rise in wages for ordinary workers that greatly reduced income inequality. Before the Great Compression, America was a society of rich and poor; afterward it was a society in which most people, rightly, considered themselves middle class. It may be hard to match that achievement today, but you can, at least, move the country in the right direction.
What caused the Great Compression? That's a complicated story, but one important factor was the rise of organized labor: Union membership tripled between 1935 and 1945. Unions not only negotiated better wages for their own members, they also enhanced the bargaining power of workers throughout the economy. At the time, conservatives warned that wage gains would have disastrous economic effects that the rise of unions would cripple employment and economic growth. But in fact, the Great Compression was followed by the great postwar boom, which doubled American living standards over the course of a generation.
Unfortunately, the Great Compression was reversed starting in the 1970s, as American workers once again lost much of their bargaining power. This loss was partly due to changes in the world economy, as major U.S. manufacturing corporations started facing more international competition. But it also had a lot to do with politics, as first the Reagan administration, then the Bush administration, did all they could to undermine the ability of workers to organize.
You can make a start on reversing that process. Clearly, you won't be able to oversee a tripling of union membership anytime soon. But you can do a lot to enhance workers' rights. One is to start laying the groundwork to pass the Employee Free Choice Act, which would make it much harder for employers to intimidate workers who want to join a union. I know it probably won't happen in your first year, but if and when it does, the legislation will enable America to take a huge step toward recapturing the middle-class society we've lost.
Truth & Reconciliation
There are many other issues you'll need to deal with, of course. In particular, I haven't said a word about environmental policy, which is ultimately the most important issue of all. That's because I suspect that it won't be possible to pass a comprehensive plan for dealing with climate change in your first year. By all means, put as much environmentally friendly investment as possible such as spending to enhance energy efficiency into the initial recovery plan. But I'm guessing that 2009 won't be the year to introduce cap-and-trade measures to reduce greenhouse gas emissions. If I'm wrong, that's great but I'm not counting on big environmental policy moves right away.
I also haven't said anything about foreign policy. Your team is well aware of the need to wind down the war in Iraq which is, by the way, costing about as much each year as the insurance subsidies we need to implement universal health care. You're also aware of the need to find the least bad solution for the mess in Afghanistan. And I don't even want to think about Pakistan but you have to. Good luck.
There is, however, one area where I feel the need to break discipline. I'm an economist, but I'm also an American citizen and like many citizens, I spent the past eight years watching in horror as the Bush administration betrayed the nation's ideals. And I don't believe we can put those terrible years behind us unless we have a full accounting of what really happened. I know that most of the inside-the-Beltway crowd is urging you to let bygones be bygones, just as they urged Bill Clinton to let the truth about scandals from the Reagan-Bush years, in particular the Iran-Contra affair, remain hidden. But we know how that turned out: The same people who abused power in the name of national security 20 years ago returned as part of the team that, under the second George Bush, did it all over again, on a much larger scale. It was an object lesson in the truth of George Santayana's dictum: Those who refuse to learn from the past are condemned to repeat it.
That's why this time we need a full accounting. Not a witch hunt, maybe not even prosecutions, but something like the Truth and Reconciliation Commission that helped South Africa come to terms with what happened under apartheid. We need to know how America ended up fighting a war to eliminate nonexistent weapons, how torture became a routine instrument of U.S. policy, how the Justice Department became an instrument of political persecution, how brazen corruption flourished not only in Iraq, but throughout Congress and the administration. We know that these evils were not, whatever the apologists say, the result of honest error or a few bad apples: The White House created a climate in which abuse became commonplace, and in many cases probably took the lead in instigating these abuses. But it's not enough to leave this reality in the realm of things "everybody knows" because soon enough they'll be denied or forgotten, and the cycle of abuse will begin again. The whole sordid tale needs to be brought out into the sunlight.
It's probably best if Congress takes the lead in investigations of the Bush years, but your administration can do its part, both by not using its influence to discourage the investigations and by bringing an end to the Bush administration's stonewalling. Let Congress have access to records and witnesses, and let the truth be told.
That said, the future is what matters most. This month we celebrate your arrival in the White House; at a time of great national crisis, you bring the hope of a better future. It's now up to you to deliver on that hope. By enacting a recovery plan even bolder and more comprehensive than the New Deal, you can not only turn the economy around you can put America on a path toward greater equality for generations to come.
Respectfully,
Paul Krugman
http://www.rollingstone.com/politics/story/25456948/what_obama_must_do |
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| | | Saturday January 30 |
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[8:16 am] Renewable Energy: China's Plan
Roscoe Wind Farm, West Texas, U.S.
The butterfly sleeps well
perched on the temple bell...
until it rings.
---Buson
Nothing is secure but life, transition, the energizing spirit....People wish to be settled; but only so far as they are unsettled is there any hope for them.
---Ralph Waldo Emerson
Yang-uan's assistant was constantly thrown off balance by his master's words. Finally he commented that he never knew whether he was in an ordinary conversation or not.
"All our conversations are ordinary," Yang-uan said.
"Then why is it so hard for me to stay on my feet?" the assistant asked.
"No need to stay on your feet," Yang-uan replied.
---Zen mondo
From Forbes, yesterday~~~
The World's Biggest Green Energy Projects
Jonathan Fahey, 01.29.10, 1:30 PM ET
The U.S. government, desperate to add jobs to a feeble economy, is looking skyward for help: to the wind and the sun.
"We should put more Americans to work building clean energy facilities," Obama said to applause during his State of the Union address Wednesday. Solar and wind power projects tend to appeal to politicians on both sides of the aisle. They are clean and domestic sources of power, and thanks to this government largesse, they are growing fast.
The American Wind Energy Association reported last week that in 2009 the nation's wind power grew 39%, and that it has grown by 39% annually for the past five years. It's a similar story with other technologies, like solar power, and abroad, where generous government subsidies in Europe and huge government-backed projects in India and China are fueling growth.
Of the top 10 largest renewable energy projects in the world, five were completed in the last two years.
That's the good news for renewable advocates. The bad news: Renewable energy remains a stubbornly small percentage of both the United States' and the world's energy portfolio. In the U.S., renewable power is about 10% of the electricity mix--subtract hydroelectric power and we're down to just 3%. Worldwide, the share of energy from renewables is closer to 20%, with just 3% from non-hydro.
The reason, of course, is that renewable power is expensive. Even a stiff breeze or blazing sunshine doesn't pack the same energy punch as a lump of coal or a nuclear fuel rod, and it isn't always sunny or windy. While a nuclear reactor will produce nearly 95% of its peak capacity, a wind farm's output will typically be 20% to 40% of its peak and a solar farm about 10% to 20%, depending on location.
The world's biggest wind farm, the Roscoe Wind Farm in Texas, has a maximum capacity of 782 megawatts. A nuclear plant with the same capacity would power 600,000 homes; given the fickle nature of wind, Roscoe will only produce enough to power 200,000 typical American homes.
But renewable plants are getting ever bigger, especially in China, where plans are on a scale far beyond anything contemplated in the rest of the world. The U.S. now has three of the 10 biggest projects in the world, but it will very soon lose the crown for largest wind project and largest solar project to China.
This month China announced it would build a 2,000 MW solar thermal project, five times bigger than the current largest one, California's Solar Energy Generating System. China is in the midst of building a wind corridor that could grow to a staggering 20,000MW, 25 times the size of Texas' Roscoe Wind Farm. And last fall China announced a plan to build a 2,000 MW solar photovoltaic farm, 33 times bigger than the world's largest today, a 60 MW farm in Spain.
Big projects can be tricky to navigate in the U.S. Though economies of scale help to reduce the cost per watt of bigger projects, bigger projects are riskier. "From the developer's perspective, bigger is better," says Ethan Zindler, an analyst at Bloomberg New Energy Finance. "But from the utility's perspective and the financier's perspective, that's not always the case."
Another problem in the U.S. right now is that projects need to get up and running before government subsidies run out, and smaller projects are easier to complete. For example, at the end of this year a provision that allows developers to get a cash grant for 30% of the construction cost of certain projects is scheduled to expire.
Also, permitting and licensing bigger projects can be more difficult. There's a rash of proposals for geothermal power plants rated at a relatively modest 49.9 MW, says Karl Gawell, executive director of the Geothermal Energy Association, because permitting is easier for plants under 50 MW.
This kind of thing irks Obama. "They're making serious investments in clean energy because they want those jobs," he said of countries like Germany, which have more generous and stable renewable energy subsidies that make projects easier to finance. "Well, I do not accept second place for the United States of America."
He may have no choice, but maybe Obama can take heart in the fact that China's two big solar farms will use U.S. technology. The big photovoltaic farm will use panels built by Arizona's First Solar and the solar thermal farm will use technology developed by California's eSolar.
Additional reporting by Jhelum Bagchi
2010 Forbes.com LLC |
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| | | Monday January 04 |
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[8:04 am] Who Has The Key To Unlock Our Grid?
Sheep safely graze near a Solon Hilber solar array in Germany.
Year after year
on the monkey's face
a monkey face.
---Basho
Out of nowhere, the mind comes forth.
---The Diamond Sutra
When Abbot Pambo was asked to say a few words to the very important Bishop of Alexandria, who was visiting some of the Desert Fathers, the elder replied: "If he is not edified by my silence, there is no hope that hewill be edified by my words."
---Thomas Merton
guardian.co.uk
Sun, wind and wave-powered: Europe unites to build renewable energy 'supergrid'
North Sea countries plan vast clean energy project
30bn scheme could offer weather-proof supply
Alok Jha
guardian.co.uk, Sunday 3 January 2010 22.30 GMT
It would connect turbines off the wind-lashed north coast of Scotland with Germany's vast arrays of solar panels, and join the power of waves crashing on to the Belgian and Danish coasts with the hydro-electric dams nestled in Norway's fjords: Europe's first electricity grid dedicated to renewable power will become a political reality this month, as nine countries formally draw up plans to link their clean energy projects around the North Sea.
The network, made up of thousands of kilometres of highly efficient undersea cables that couldcost up to 30bn (£26.5bn), would solve one of the biggest criticisms faced by renewable power that unpredictable weather means it is unreliable.
With a renewables supergrid, electricity can be supplied across the continent from wherever the wind is blowing, the sun is shining or the waves are crashing.
Connected to Norway's many hydro-electric power stations, it could act as a giant 30GWbattery for Europe's clean energy, storing electricity when demand is low and be a major step towards a continent-wide supergrid that could link into the vast potential of solar power farms in North Africa.
By autumn, the nine governments involved Germany, France, Belgium, the Netherlands, Luxembourg, Denmark, Sweden and Ireland and the UK hope to have a plan to begin building a high-voltage direct current network within the next decade. It will be an important step in achieving the European Union's pledge that, by 2020, 20% of its energy will come from renewable sources.
"We recognise that the North Sea has huge resources, we are exploiting those in the UK quite intensively at the moment," said the UK's energy and climate change minister, Lord Hunt."But there are projects where it might make sense to join up with other countries, so this comes at a very good time for us."
More than100GW of offshore wind projects are under development in Europe, around10% of the EU's electricity demand, and equivalent to about 100 large coal-fired plants. The surge in wind power means the continent's grid needs to be adapted, according to Justin Wilkes of the European Wind Energy Association (EWEA). An EWEA study last year outlined where these cables might be built and this is likely to be a starting point for the discussions by the nine countries.
Renewable energy is much more decentralised and is often built in inhospitable places, far from cities. A supergrid in the North Sea would enable a secure and reliable energy supply from renewables by balancing power across the continent.
Norway's hydro plants equivalent to about 30 large coal-fired power stations could use excess power to pump water uphill, ready to let it rush down again, generating electricity, when demand is high. "The benefits of an offshore supergrid are not simply to allow offshore wind farms to connect; if you have additional capacity, which you will do within these lines, it will allow power trading between countries and that improves EU competitiveness," said Wilkes.
The European Commission has also been studying proposals for a renewable-electricity grid in the North Sea. A working group in the EC's energy department,led by Georg Wilhelm Adamowitsch, will produce a plan by the end of2010. He has warned that without additional transmission infrastructure, the EU will not be able to meet its ambitious targets.Hunt said the EC working group's findings would be fed into the nine-country grid plan.
The cost of a North Sea grid has not yet been calculated, but a study by Greenpeace in 2008 put the price of building a similar grid by 2025 at 15bn-20bn. This would provide more than 6,000km of cable around the region. The EWEA's 2009 study suggested the costs of connecting the proposed 100GW wind farms and building interconnectors, into which further wind and wave power farms could be plugged in future, would probably push the bill closer to30bn. The technical, planning, legal and environmental issues will be discussed at the meeting of the nine this month.
"The first thing we're aiming for is a common vision," said Hunt. "We will hopefully sign a memorandum of understanding in the autumn with ministers setting out what we're trying to do and how we plan to do it."
All those involved also have an eye on the future, said Wilkes. "The North Sea grid would be the backbone of the future European electricity supergrid," he said. This supergrid, which has support from scientists at the commission's Institute for Energy (IE), and political backing from both the French president, Nicolas Sarkozy, and Gordon Brown,would link huge solar farms in southern Europe producing electricity either through photovoltaic cells, or by concentrating the sun's heat to boil water and drive turbines with marine, geothermal and wind projects elsewhere on the continent. Scientists at the IE have estimated it would require the capture of just 0.3% of the light falling on the Sahara and the deserts of the Middle East to meet all Europe's energy needs.
In this grid, electricity would be transmitted along high voltage direct current cables. These are more expensive than traditional alternating-current cables, but they lose less energy over long distances.
Hunt agreed that the European supergrid was a long-term dream, but one worth making a reality. The UK, like other countries, faced "huge challenges with our renewables targets," he said. "The 2020 target is just the beginning and then we've got to aim for 2050 with a decarbonised electricity supply so we need all the renewables we can get."
A North Sea grid could link into grids proposed for a much larger German-led plan for renewables called the Desertec Industrial Initiative (DII). This aims to provide 15% of Europe's electricity by 2050 or earlier via powerlines stretching across desert and the Mediterranean. The plan was launched last November with partners including Munich Re, the world's biggest reinsurer, and some of Germany's biggest engineering and power companies, including Siemens, E.ON, ABB and Deutsche Bank. DII is a$400bn (£240bn) plan to use concentrated solar power (CSP) in southern Europe and northern Africa. This technology uses mirrors to concentrate the sun's rays on a fluid container, the super-heated liquid thendrives turbines to generate electricity. The technology itself is nothing new CSP plants have been running in the United States for decades and Spain is building many but the scale of the DII project would be its biggest deployment ever.
guardian.co.uk © Guardian News and Media Limited 2010
http://www.guardian.co.uk/environment/2010/jan/03/european-unites-renewable-energy-supergrid
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| | | Wednesday December 30 |
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[7:51 am] All For Naught
In this Getty image, U.S. President Barack Obama makes a statement at the Marine Corps Base in Kaneohe Bay Monday on a failed bid to blow up a US-bound transatlantic airliner on Christmas Day.
These are the thoughts of all men in all ages and lands,
they are not original with me,
If they are not yours as much as mine they are nothing
or next to nothing.
If they do not enclose everything they are next to
nothing,
If they are not the riddle and the untying of the riddle
they are nothing,
If they are not just as close as they are different
they are nothing.
---Walt Whitman
From the age of six I had a mania for drawing the form of things. By the time I was fifty, I had published an infinity of designs, but all that I have produced before the age of seventy is not worth taking into account. At seventy-three I have learned a little about the real structure of nature, of animals, plants, birds, fishes, and insects. In consequence, when I am eighty, I shall have made more progress, at ninety I shall penetrate the mystery of things, at a hundred I shall have reached a marvelous stage, and when I am a hundred and ten, everything I do, be it a dot or a line, will be alive.
---Hokusai
Why, sometimes I've believed as many as six impossible things before breakfast.
---The Red Queen
It's the time of summing up, and everybody wants to call it The 0 Decade. Zero. But as frustrating and maddening as these first 9 years of the millenium have been, mathematicians and meteorologists agree it takes 10 years to make a decade. So what's a group of 9 called? A nonet. None. Nine. Bah.
Alexander Cockburn's chilly summary at Truthout goes all the way back to 1970, and considers most jarringly what America would NOT be had Hinckley succeeded in killing Reagan. http://www.truthout.org/topstories/1228093 Other reviewers are content to tally up the social nothingness of the Bush 8 out of 9. But Obama is a major target of scrutiny...and that transparency must be getting the full X-ray treatment.
A week ago Sunday, Frank Rich declared Time Magazine's selection of Ben Bernanke as Man (in the sense of huMAN) of the Year was completely off the beam. His choice was Tiger Woods. Why? Because Tiger emerged absolutely as the best conman...and 2009 definitely was the Year of the Con. From Bernie Madoff to John Edwards, everybody was out to pick your pocket. And Obama? You betcha! "Though the American left and right dont agree on much, they are both now coalescing around the suspicion that Obamas brilliant presidential campaign was as hollow as Tigers public image a marketing scam designed to camouflage either his covert anti-American radicalism (as the right sees it) or spineless timidity (as the left sees it)." http://www.nytimes.com/2009/12/20/opinion/20rich.html?_r=1&th=&emc=th&pagewanted=all
This morning Maureen Dowd may as well be working for Fox News as she refers to Barack Obama as an emotionless, "disembodied" Mister Spock. The current administration seems to share with the previous that it has the intelligence but doesn't have the intelligence. "If we cant catch a Nigerian with a powerful explosive powder in his oddly feminine-looking underpants and a syringe full of acid, a man whose own father had alerted the U.S. Embassy in Nigeria, a traveler whose ticket was paid for in cash and who didnt check bags, whose visa renewal had been denied by the British, who had studied Arabic in Al Qaeda sanctuary Yemen, whose name was on a counterterrorism watch list, who can we catch?" http://www.nytimes.com/2009/12/30/opinion/30dowd.html?ref=opinion
I've had similar concerns about President Obama's performance this year...and I've posted them online. Yesterday morning on the radio, those of us with such doubts got a substantial scolding. It happened on the Stephanie Miller program, a radical piece of broadcasting even by morning show standards. We hear an hour of it every weekday morning, from 10 to 11, on the unlikely WAIS, 770 AM, in the Athens area. http://www.stephaniemiller.com I feel an affinity for Stephanie because she also is from the Buffalo area, and has a quality of outrageous zaniness one acquires looking for excitement in Western New York on a Saturday night. I also remember her father fondly, US Representative William E. Miller, a moderate-to-liberal Republican, which was a rarity in Upstate politics. Mr. Miller ran for the vice presidency on Barry Goldwater's ticket in 1964, and Stephanie jokingly ran for president in 2008, with Goldwater's granddaughter as her running mate.
But Stephanie Miller and her whole crew are on holiday this week, so it was a guy subbing for her who took us Obama doubters to task yesterday. His name is Hal Sparks and he seems to show up a lot on her show. He has a rather odd resume so far http://www.huffingtonpost.com/hal-sparks but I thought his comments were right on. He challenged us grass rooters, who worked so hard last year and then went home after the election and put our feet up. Now we're moaning that after 11 months we haven't gotten what we want yet from Obama, and vowing to vote for Nader next time. Sparks reminds us it's a lot harder to build up after something has been torn down, and the President still needs grass roots support. That doesn't just mean arguing with the rednecks at work. It means encouraging congresspeople who still are in there pitching for the program. It means active engagement with those who aren't. He said the Democratic Party and Barack Obama need even more help from us now than before.
Well, I hadn't thought about it enough that way I guess. So my summary is more along the lines of checking out what campaign promises Obama really made in the summer and fall of 2008. Has he kept to those promises or not? Does he deserve my continued support? To find out I picked up issue 1064 of Rolling Stone which contained an excellent interview with the candidate on the very eve of the election. Interviewing was Eric Bates, one of the many editors of the magazine. http://www.rollingstone.com/news/coverstory/23589412 I have to confess surprise that Barack Obama has been consistent in setting about to do exactly what he said he would. There isn't sharp focus in the banking area I must say, but clearly the administration now realizes any bailout money has got to go to smaller hometown banks to lend to small business. Americans have got to have jobs and the opening for creation is in the area of renewable energy. Gore has been saying this for a long time, but now we're hearing it from the White House...and such talk has got to be encouraged.
There are things we can do around our towns. Everywhere people are learning about energy audits and how to save money on changing lifestyles and retrofitting buildings and homes. Local schools and churches need community involvement in learning how to do this. People are wondering about sustainability and if you look around, you'll find meetings being held. Attend them. Get involved. That spirit of enthusiasm and optimism we had during the campaign is going on there. Young people are at work and they're spreading the word among peers who still are learning the basics.
The Naughts are gone, and Twenty-Ten is the start of the Teens. It's a time of vigorous growth and development. It's a time of risk. It's the time for dedication to lasting values. It's time to fall in love. It's a wonderful time to be alive. Let's get busy!
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| | | Tuesday December 22 |
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[7:08 am] Christmas '09
Red morning sky---
snail,
are you glad of it?
---Issa
I don't believe people are looking for the meaning of life as much as they are looking for the experience of being alive.
---Joseph Campbell
The only means of strengthening one's intellect is to make up one's mind about nothing---to let the mind be a thoroughfare for all thoughts.
---John Keats
Of course, Keats died young. Good grief, by the time he was my age he had been dead about 45 years! Does that idea of letting thoughts rush through one's mind sound like a young man? I think I can remember being like that. Joseph Campbell lived into old age and he sounds it. I suppose we elders treasure moments when we feel especially alive.
I don't wish to belittle those ideas by bringing up age, but I was thinking of the relativity of one's eagerness for new things as I tried to come up with something to say about the passing year. It feels like only yesterday Dana looked over at me and said she was ready to have grandchildren now. Actually it was a couple years ago, and I remember sort of blinking at her and wondering where that came from. Ilona was still in high school and Jeroch showed no signs of settling down. I guess being settled isn't a requirement for getting married and having children, but I tend to associate permanence with those conditions. Why was Dana rushing us into grandparenthood?
She just was ready, that's all. Maybe women know about these things. Nesting instincts or something. It all remains very mysterious to me and other men I know---which may be why we invented the garage and hunting and activities like that. Dana has been a wonderful grandmother I think...and I hope our daughter-in-law Karen agrees. Because shortly after Dana was thinking about becoming a grandmother, Jeroch up and married this perfectly perfect person for him, and out have come two beautiful and fascinating daughters, Nina and Sophia. Jeroch hasn't settled down, and in fact has established a philosophy that young people shouldn't try to settle down in these tumultuous times. We need to prepare for a return to the life of nomadic tribes.
This year they've continued testing their hypothesis by house-sitting for numerous sabbaticalizing professors around here. Low rent, and you don't get bogged down accumulating a lot of stuff. Jeroch has been working at Fur Peace Ranch, the music camp and concert area rock and blues musician Jorma Kaukonen set up in the area. Jeroch has a number of skills in baking, cooking, gardening he puts to use, not only for Jorma but in freelance work too. Karen has trained for years in some intense yogas, and is adapting these forms into midwifery. Now as Nina celebrates her 2nd birthday, it is clear she loves her little sister very much---in English and Spanish. (They are a bilingual family.)
Ilona's scholarship made her a candidate for just about any university experience she wanted. We traveled around to a few normal schools, but all the time she kept talking about this place in the Smoky Mountains called Warren Wilson. I kept pointing her to New England, betraying my chauvanism about where you get an education in this country. Nope, finally she got me to go down to Asheville, North Carolina, and those people romanced me right into signing on the dotted line.
The college is very oriented toward environmental approaches to things, and that's what Ilona wanted. The school has the first Leeds accredited dorm in the nation, and the other residences are competing with each other to catch up. The college grows its own food and raises livestock. Each student has a job at the school, for which payment reduces tuition. Ilona has had training in energy auditing, and that's what she does there. Besides academic studies, students are expected to perform community service as well in areas of Appalachia where the need is great. Here she is, home for winter break and when I hinted that OU really is making progress in environmental concerns, she saw I was opening up an alternative just in case and affirmed she's in the school where she wants to be.
As for Dana and me, we had a little empty nest time...but then I guess we were reminded that it's been a long while since we were just getting to know each other. It might be refreshing to pick up where we left off with that. We don't have to argue about who's making what mistakes with the kids anymore, and we just can go out on dates and watch old movies if we want to. That's not a bad deal...I mean, when we're not babysitting.
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