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309. -new- 2008 Is Only Half the Story
The world, not just the United States, entered devastating recession- depression in 2008, a debacle from which it is yet to recover. Some have pinned the tail on the donkey: it stems from a worldwide financial sector that is terribly out of control, which exerts unbridled political and financial dominance across the globe, and which commonly breaks the law(s) in pursuit of gain. To look further into this, read Gautam Mukunda’s “The Price of Wall Street Power” in the Harvard Business Review, June 2014 (06-18-14)

308. Taking on the Impossible: Quagga and Zebra Mussels

In  “Science Takes on a Silent Invader,”  we learn of a not-to-be-daunted scientist Daniel Molloy who has routed very stubborn pests—some miscreant European mussels that have come to these shores.
“These silent invaders, the quagga and zebra mussels, have disrupted ecosystems by devouring phytoplankton, the foundation of the aquatic food web, and have clogged the water intakes and pipes of cities and towns, power plants, factories and even irrigated golf courses.

Now the mussels may have met their match: Daniel P. Molloy, an emeritus biologist at the New York State Museum in Albany and a self-described Bronx boy who became fascinated by things living in water. ”

“Leading a team at the museum’s Cambridge Field Research Laboratory in upstate New York, he discovered a bacterium, Pseudomonas fluorescens strain CL145A, that kills the mussels but appears to have little or no effect on other organisms.”
“Both species are thought to have arrived in North America in the ballast of trans-Atlantic cargo ships. By 1991 they appeared in the Hudson River, and within a year there were 500 billion between Troy and West Point, said David L. Strayer, an ecologist with the Cary Institute of Ecosystem Studies in Millbrook, N.Y.

The tiny mussels became a dominant species in the Hudson. Not even counting their shells, their total weight exceeded that of all the fish, plankton and bacteria combined, Dr. Strayer said, adding that they filtered “a volume of water equal to that of all the water in the estuary every one to four days.” There were no natural enemies to keep them in check.
None, that is, except scientists like Dr. Molloy. His fascination with water goes back to childhood summers on Lake Hopatcong, in New Jersey, where his father, an Irish-born lieutenant in the New York Fire Department, had built a cottage."

“Recently retired from the State Museum, Dr. Molloy is now a research biologist at the University at Albany, where he is assembling an international team of scientists to take on a new challenge: Haplosporidia, spore-forming parasites that have plagued bivalves worldwide.

There are more than 40 species, including the notorious Haplosporidium nelsoni MSX, which has devastated oyster populations in the Chesapeake Bay and along the Atlantic Coast. No one has been able to figure out how the spores spread infection from one host to another.” (3-5-14)

307. Fusion Inches Along
“In experiments done at a U.S. Department of Energy laboratory last fall and published in a scientific journal Wednesday, researchers blasted the world's most powerful laser at a target the size of a small pea. It triggered a fusion reaction that unleashed a vast amount of energy­for a fraction of a second.”  See “U.S. Scores Fusion-Power Breakthrough. ” (02-19-2014)

306. Deploying the Forest Against Tsunamis
“Miyawaki, who already planted over 40 million trees in 1,700 locations in Japan and overseas, wants to resurrect tsunami affected areas by reducing its destructive force with the “1,000-year Kibonooka Project”. The forest will function as a green barrier protecting people and property against large tsunamis. The park, which is currently being built in Iwanuma City is also meant to be a memorial so that people will remember the tragedy for a “thousand years into the future”.
Everybody from Joseph Stalin to university geology departments have wanted to put trees in bad weather spots to halt erosion from wind and rain.  Miyawaki has actually done enough planting to make a difference. And he thinks he can actually push back tidal waves with the right tree cover. (1-15-14)

305. Democracy from Above:  Bhutan
Throughout the world we see populist movements that give birth to small revolutions, but in the end lead to autocracy or chaos rather than democracy.  We think  Egypt, Eastern Europe, and even the stirrings in Syria. In fact, it was the royal family in Bhutan that gently pushed the country into modernity and into some semblance of democracy.  “Introduced in 1972 by King Jigme Singye Wangchuck, gross national happiness was seen as a way to balance the country’s gradual embrace of modernity with an effort to preserve its traditions.

Mr. Tobgay’s predecessor, Jigme Thinley, had traveled the world promoting the happiness measure, making him a popular figure among Western academics and literati but less so among his constituents.”  But now along has come Tshering Tobgay who has put less emphasis on lofty passions like happiness and worked harder to put bread on the table.
“Mr. Tobgay’s catalog of modest promises during the election campaign included a motorized rototiller for every village and a utility vehicle for each district. Happiness was not on his list.

“Rather than talking about happiness, we want to work on reducing the obstacles to happiness,” he said.”
“Mr. Tobgay has eliminated some of the restrictive customs enforced by the previous government, including occasional bans on vehicular traffic and a dress code requiring men to wear ghos, a dresslike traditional garment. He acknowledged that preserving the country’s traditional culture would be challenging in an era of rapid urbanization.

Bhutan’s royal family is revered, and criticism of royalty remains unthinkable. But the national news media are lively, and the country’s many and growing democratic and educational institutions have made Bhutan the darling of development and nongovernmental funding organizations.

“Bhutan is an exceptional success story,” said Sekhar Bonu of the Asian Development Bank. “It’s a ray of hope in South Asia, and it sets a new benchmark when we talk to other countries.”” The comments here are extracted from “Index of Happiness?  Bhutan’s New Leader Prefers More Concrete Goals.” New York Times, October 4, 2013, p. A5 .(10-9-13)

304. What Might Replace Silicon in Computer chips?
“PALO ALTO, Calif. — A group of Stanford researchers has moved a step closer to answering the question of what happens when silicon, the standard material in today’s microelectronic circuits, reaches its fundamental limits for use in increasingly small transistors.”

“In a paper in the journal Nature on Wednesday, the researchers reported that they had successfully built a working computer — albeit an extremely simple one — entirely from transistors fashioned from carbon nanotubes. The nanotubes, which are cylinder-shaped molecules, have long held the promise of allowing smaller, faster and lower-powered computing, though they have proved difficult to work with.” (10-9-13)

303. Revival of Manufacturing in America

Here and there, the New York Times detects a return of manufacturing to America from foreign shores as prices get more competitive and buyers seek better quality and better delivery schedules. It comments on the survival of L.C.King of Bristol Tennessee has gradually developed relationships with high end clothing designers, positioning itself in what we call the boutique economy which is the successor to America’s role as a mass manufacturer.  In Gaffney, South Carolina so many textile plants have evaporated, but yet there are revived winners. “The old textile mills here are mostly gone now. Gaffney Manufacturing, National Textiles, Cherokee clangorous, dusty, productive engines of the Carolinas fabric trade fell one by one to the forces of globalization.” “Drive out to the interstate, with the big peach-shaped water tower just down the highway, and you’ll find the mill up and running again. Parkdale Mills, the country’s largest buyer of raw cotton, reopened it in 2010.” (9-25-13)

302. The Secret of Finland’s Success

The Atlantic Monthly has tried to figure out what makes Finland so successful.

“Inarguably one of the world's most generous -- and successful -- welfare states, the country has a lower infant mortality rate, better school scores, and a far lower poverty rate than the United States, and it's the second-happiest country on earth (the U.S. doesn't break the top 10). According to the OECD, Finns on average give an 8.8 score to their overall life satisfaction. Americans are at 7”

“Here's the difference: Finland's welfare system was hardwired into its economic development strategy, and it hasn't been seriously challenged by any major political group since.”

”It's also worth noting that Finland isn't a total economic Wonderland, either: It's not growing very fast and will probably have issues with its aging population in coming years. The Bank of Finland recently predicted that the country might soon exceed the 60 percent debt-to-GDP ratio mandated by the European Union -- a common problem in Europe these days. “

"Jefferey Sellers, a University of Southern California political scientist, found another key difference between the two nations: Finland has much more powerful local governments than the U.S., and they're tasked with executing the myriad functions of the welfare system -- from helping the poor to operating the day cares. Municipal taxes are redistributed and supplemented with grants, thus largely eliminating the problem of under-resourced areas. Local public expenditures are 20 percent of GDP in Finland, but just 10 percent in the U.S., he points out."  (7/24/13)

301. The Slow, Painful Disintegration of Argentina

For anyone in the West the meltdown of Argentina in the 20th century, which continues in the 21st, is painful to watch and feel.  At the beginning of the 20th, Argentina was one of the leading countries of the world.  Now other countries in South and Central America have eclipsed it, particularly Brazil and Chile.  It seems most of all to be due to ongoing political malaise which has made a hash of most everything.  Lately we read  “An Argentine Tradition Threatens to Crumble with City Architecture.”, with an old, somewhat beloved subway fast falling apart.

”The antique Belgian-built cars, a symbol of Buenos Aires early-20th-century wealth, were taken out of service this year, and their retirement is a poignant example of the city’s struggle to preserve its physical history as some of its icons and infrastructure crumble.

An audit last fall cautioned that much of Buenos Aires underground transit system was in a dangerous state of disrepair, and that the city’s oldest line linking the presidential mansion, the Casa Rosada, and the Once train station south of downtown should be removed from service immediately.”


”Argentina promised to be a very, very important country, said Teresa Anchorena, an artist and member of the National Commission of Museums, Monuments and Historic Places, which lobbies for the protection of hundreds of sites throughout the country. Argentina’s broken promise is reflected in its buildings.

With its ornate cars, the Buenos Aires subway was the first built in Latin America and the 13th in the world, ahead of the systems in Madrid, Tokyo and Moscow. At the time, Argentina was the worlds ninth-richest country, according to the historic incomes database of the British economist Angus Maddison.

In 1910, newspapers in 80 languages were available in Buenos Aires. The city had the regions biggest zoo and a well-regarded research center on infectious diseases. Argentina’s gross domestic product per capita was nearly twice that of Spain’s and nearly five times bigger than Brazil’s, according to the database" “


”This eclecticism is the city’s identity, said Ms. Capano, president of the Network for Patrimony, an umbrella group that advocates preservation.

The draftsmen of the famed architects copied the designs of their European teachers, building entire neighborhoods of Tudor homes or German chalets. Italian immigrants built lay society temples devoted to Galileo, da Vinci and Verdi, structures the likes of which are thought to exist nowhere else in the world, said Fabio Grementieri, an architect who specializes in buildings from the early 20th century.

People undervalue it because they say its only a copy of Europe, he said. Strangely, Argentina has consecrated tango and literature, which are a great mixture of cultural influences, but not the third manifestation of this mixing, which is architecture.

Preservationists acknowledge that new construction is inevitable but complain that too little of the city’s history is being spared. One of many buildings at risk of demolition, preservations say, is the 1923 Palacio Barolo, a mansion commissioned by a self-made millionaire and designed in accordance with the cosmology of Dante’s Divine Comedy.”

 ”The countless once grand and now grimy homes across Buenos Aires, with their neoclassical columns and crystal chandeliers, stained-glass cupolas and unhinged lattices, are testament to years of political and economic upheaval, Ms. Anchorena said.

What’s happened to these buildings is a little like whets happened to Argentina, she said. These buildings are witness to the Argentina that still could be.” (April 24, 2013)

300. Are We Getting Dumber?

We vote "yes." But probably the answer is "yes and no." With our digital pre-occupation, we are wiping out certain forms of human contact and often our awareness of events outside a 24-hour time span. But, boy, the details within a short time frame our drilled into our heads. Anyway Scout at the University of Wisconsin explores this topic in an interesting way:

"New study claims humans are evolving to become less intelligent

Dumb and Dumber - Study Says Humans Are Slowly Losing Their Smarts

Our Fragile Intellect, Parts I and II

17 Things That Make You Dumber

The Movie Hollywood Doesn't Want You to See

Are Humans Getting Dumber?

Synthetic Synapse Could Take Us One Step Closer to an Artificial Brain


In the 20th century alone, humans have invented aircraft, nuclear power,
computers, video game consoles, and the World Wide Web. Yet a recent study
by Gerald Crabtree, a geneticist at Stanford University, suggests that
humans are evolving to become less intelligent. Crabtree claims that
mutations affecting 5,000 genes in our DNA have negatively affected our
intelligence over the last 3,000 years. Crabtree asserts that random,
naturally occurring mutations have most likely occurred in virtually every
human. The safer life gets for humans, the less important it is for us to
have good judgment for survival and mating. No longer are we constantly
wary of predators and environmental hazards, which has resulted in
diminished survival instincts. So why have we accomplished so much over the
last 3,000 years? According to Crabtree, our cumulative knowledge and
ability to transfer knowledge has grown over the centuries; it is only our
individual brainpower that has declined. [HW]

The first link provides readers with US News's summary of Crabtree's
findings. The second link offers parts 1 and 2 of Crabtree's full study,
published in "Trends in Genetics." The third link brings interested readers
to a Business Insider piece, based on 17 studies, which lists modern human
behavior that correlates with reduced ability on intelligence measures. The
fourth link is a review of Idiocracy, a film referenced in several articles
about Crabtree's findings because of its portrayal of future humans as,
well, idiots. The fifth link is a more critical review of Crabtree's
study, which claims that it doesn't matter that our genes have mutated,
because our ability to crowd source knowledge has skyrocketed, and modern
science can or will be able to manipulate genes. The sixth link offers
readers evidence of this modern science, with the recently developed
synthetic synapse."

(01-23-13)

299. -new- Leading Edge Water Management

Kitakyushu is a showcase for Japan's brightest water management ideas. Leaders in Water Recycling R&D, the "Japanese tend to murmur mottainai (too good to waste) at the sight of something perfectly usable being discarded or wasted – an apparent manifestation of their traditionally held respect for nature and other things. Even for the people in a rainy and water-rich country, domestic wastewater being dumped into rivers and the sea without being recycled looks plainly wasteful (mottainai). It is no wonder then that Japan has been doing extensive research on water-recycling and reuse technologies with the aim of dealing with global water problems in general, not just recycling water in Japan.

Demonstration Plant Open to World

A full view of Water Plaza Kitakyushu. Buildings on the left connected with piping are a demonstration plant for water recycling and reuse. Buildings on the right are test beds for technological research and development.

"Water Plaza Kitakyushu," located in Kitakyushu City, Fukuoka Prefecture, is a demonstration plant for water recycling and reuse built in 2009 by a confederation of Japanese government organizations, the city, and industrial material and plant equipment manufacturers. For their part, the member companies have also established the Global Water Recycling and Reuse Solution Technology Research Association (GWSTA) with the specific aim of developing original techniques and sending out information to the world on expertise in ways of managing a water-recycling system. Water Plaza is not a mere demonstration plant for water recycling. It is one of the largest research centers in Japan aimed at solving global water problems.

Bottled water (from left to right): raw sewage, seawater, and recycled water. Sewage and seawater each go through two rounds of filtration to be recycled into clean water.

Sitting on a site of about 6,000 square meters, Water Plaza has a pair of facilities – a demonstration plant equipped with advanced water recycling and reuse systems, and test beds for technological research and development. The plaza is unique in that it is testing the world's first state-of-the-art technology for improving the efficiency of producing recycled water by mixing seawater with water recycled from sewage and purifying it.

The plaza daily collects 2,000 tons of water – 1,500 tons of domestic wastewater, equivalent to living drainage from about 6,000 people, and 500 tons of seawater. Of the total, 300 tons of water are set aside for experimental purposes and the remaining 1,700 tons are treated to produce 1,400 tons of recycled water. Currently, the recycled water is being supplied to a power plant 2 kilometers away to be used for its boilers fueled by LNG.

Nano-level Technology for Purification

Water is filtered through membranes made with Japan's leading-edge technology. Wastewater is filtered through ultra fine holes punched in the membrane, with their diameter measuring a 10,000th to a millionth of a millimeter each.

Real-size plane membranes used in the first round of filtration of sewage. With holes as fine as nano levels in diameter, they are capable of capturing almost all impurities.

In the case of sewage, it is first treated with microorganisms to dissolve organic sludge, then filtered through the membrane to do away with remaining particles, including microorganisms, and becomes clear water.

In the case of seawater, an ultra filtration (UF) membrane is used to eliminate particles such as bacteria. Both sewage and seawater finally go through yet another membrane system to eliminate salt and ions to be recycled into drinkable water.

The membrane used in the second stage of filtration has nano-level holes of a millionth of a millimeter in diameter, the result of cutting-edge technology. The membrane is rolled up multiple times into the shape of a tube measuring 8 or 16 inches in diameter. As water cannot filter through the membrane due to the much too fine holes, water is pressurized with a pump to force its way through the holes to become drinkable.

Drinkable Water

Water thus recycled is clear, colorless and drinkable. Recycled water not only meets the Japanese government's quality standards for tap water in terms of chlorine ions, total organic carbon and residue on evaporation, but it also contains less than half the standard levels of total organic carbon and residue on evaporation.

The recycling system boasts a high recycling ratio of more than 80%. It could well be a product of the Japanese trait that does not tolerate any waste, trying to use even the residue of wastewater. All of this is a result of extensive research to utilize wastewater to the fullest.

The key was to put wastewater extracted from sewage into seawater having gone through the first round of filtering. As a result, the overall recycling ratio is improved compared with conventional methods and the salt content of diluted seawater is also lower, making it possible to halve the pumping pressure needed to filter water through the fine-hole membrane to eliminate the salt in the second stage of filtering. Those measures have ensured an efficient, low-cost water-recycling system.

In the test beds in the plaza compounds, five firms, including water treatment companies, have set up pilot plants. The companies are vying to develop even better water-recycling systems with greater energy conservation and cost reduction, including the development of chemicals able to sterilize membranes at a lower cost.

High Hopes for Solving Global Water Shortage

Since it opened, Water Plaza has received 750 foreign visitors from 54 countries. The largest number of visitors came from China, followed by those from Southeast Asia and the Middle East.

Rapidly growing countries are suffering from serious shortages of water as a result of population growth and rising demand for industrial water. If these emerging countries are able to supply their industries with recycled water, then they can use saved water for agricultural irrigation and other purposes, at the same time enabling them to dispose of the massive amounts of domestic wastewater swelling with urbanization. That is a "sustainable city" Water Plaza is aiming for."

(01-22-13)

298. Japanese Hi-Tech Bathrooms

We have long remarked on the Global Province that the Japanese sport bathrooms that are far in advance of those in the West, but which also, we suspect, attest to a compulsive fascination with the processes by which humankind rids itself of wastes. "Japan's Evolved Bathrooms" discusses some of their toilet focus.

"The most talked-about restrooms in Tokyo at present can be found in the high-rise commercial facilities next to Shibuya station that opened in spring 2012. The "spaces" are called "switch rooms" instead of restrooms because they are designed to give visitors a change of mood. They were designed to suit women aged 25-40 years with different lifestyles. The six different restrooms for women and three different restrooms for men are elaborately designed unlike any restroom you have seen before."

''In total contrast to this, Osaka residents were surprised this fall by the exhibition of restrooms where visitors could stay overnight! A Japanese artist now resident in Berlin added on spaces for bedrooms to public restroom facilities in an Osaka park, as part of a series of art installations in public spaces organized by Osaka Prefecture for a limited time. This "restroom hotel" even had a front desk manned by check-in staff. A lottery was held and eight lucky couples got to stay the night. The transformed restrooms were lit up at nighttime, changing the public restroom into a new urban style."

(01-02-13)

297. Keynes Arises

Lord Keynes had the right idea in the Great Depression. The only way to restore a healthy economy and buoyant demand is for the Government to go in debt by pumping a whole lot of money into the economy. Most recently this has been proven twice—in spades. With Obama economics we have had a slow recovery of the American economy since 2008, but a recovery. Paul Krugman says we could have done better, but that we simply have not opened the money floodgates enough. The Brits, meanwhile, have proven Keynes right by not following him. They have gone for austerity, promising that prosperity is right around the corner, and yet the UK simply gets in a deeper and deeper trouble. Adam Posen, a bright American economist, has plumped for reflation in his post at the Bank of England, but he has been a lone voice, as all the other august voices there try to tell the working man that Britain can starve itself out of depression. Time and again, conventional politicians and conventional thinkers prove themselves unequal to crisis, stubbornly embracing rigid policies that are not at all responsive to crisis. In this vein, it is instructive to read about the agile Judge Richard Posner who also teaches at the University of Chicago Law School. He's a conservative sort who fell under the monetarist spell of Milton Friedman, but has since faced the obvious. Now he's gone Keynesian which we all must do when the economy is in the toilet. Friedman helped us manage good times, but is of little value when our economy is in the toilet and, more importantly, the whole nature of our economy is changing radically.

(01-02-13)

296. River-Osmosis Electricity

Pressure-retarded osmosis (PRO) is a possible major source of electricity, according to Yale researchers. "PRO works by funneling river water and sea-water into side-by-side chambers separated by a special membrane. Since the salt content of seawater is greater than that of river water, the river water flows through the membrane into the seawater. The pressure generated by that flow spins a turbine, which creates electricity.

"This is a form of renewable energy similar to solar energy or wind energy," says Ngai Yin Yip &rsquo11MPhil, an environmental engineering PhD student and coauthor of a study published in April in Environmental Science & Technology."

(12-12-12)

295. Are We Getting Dumber?

First of all, we think so. We credit technology that blocks out thinking—such as television and cellphones and social networking—and technology that makes us lazy-- such as electronic calculators and automatic transmissions—which means that we do less with our hands and minds.

Scout, at the University of Wisconsin, has briefly examined this question. Clearly we should give this a closer look. It would seem that a few amongst us are getting smarter and smarter, but, on average, the population may be falling into mindless mediocrity

"New study claims humans are evolving to become less intelligent

Dumb and Dumber - Study Says Humans Are Slowly Losing Their Smarts
http://www.usnews.com/news/articles/2012/11/13/dumb-and-dumber-study-says-humans-are-slowly-losing-their-smarts?utm_medium=referral&utm_source=pulsenews

Our Fragile Intellect, Parts I and II
http://www.cell.com/trends/genetics/searchresults?searchText=gerald+crabtree&submit_search=Search&searchBy=fulltext

17 Things That Make You Dumber
http://www.businessinsider.com/17-things-that-make-you-dumber-2012-8?op=1

The Movie Hollywood Doesn't Want You to See
http://www.slate.com/articles/arts/movies/2006/09/the_movie_hollywood_doesnt_want_you_to_see.html

Are Humans Getting Dumber?
http://io9.com/5960176/are-humans-getting-dumber

Synthetic Synapse Could Take Us One Step Closer to an Artificial Brain
http://io9.com/5917334/synthetic-synapse-could-take-us-one-step-closer-to-an-artificial-brain

In the 20th century alone, humans have invented aircraft, nuclear power,
computers, video game consoles, and the World Wide Web. Yet a recent study
by Gerald Crabtree, a geneticist at Stanford University, suggests that
humans are evolving to become less intelligent. Crabtree claims that
mutations affecting 5,000 genes in our DNA have negatively affected our
intelligence over the last 3,000 years. Crabtree asserts that random,
naturally occurring mutations have most likely occurred in virtually every
human. The safer life gets for humans, the less important it is for us to
have good judgment for survival and mating. No longer are we constantly
wary of predators and environmental hazards, which has resulted in
diminished survival instincts. So why have we accomplished so much over the
last 3,000 years? According to Crabtree, our cumulative knowledge and
ability to transfer knowledge has grown over the centuries; it is only our
individual brainpower that has declined. [HW]

The first link provides readers with US News's summary of Crabtree's
findings. The second link offers parts 1 and 2 of Crabtree's full study,
published in "Trends in Genetics." The third link brings interested readers
to a Business Insider piece, based on 17 studies, which lists modern human
behavior that correlates with reduced ability on intelligence measures. The
fourth link is a review of Idiocracy, a film referenced in several articles
about Crabtree's findings because of its portrayal of future humans as,
well, idiots. The fifth link is a more critical review of Crabtree's
study, which claims that it doesn't matter that our genes have mutated,
because our ability to crowdsource knowledge has skyrocketed, and modern
science can or will be able to manipulate genes. The sixth link offers
readers evidence of this modern science, with the recently developed
synthetic synapse."

(11-28-12)

294. Computers Need a Big Fix

"Killing the Computer to Save It" explores Peter S. Neumann's thesis that the only way to build real security into computers is to entirely remake them. "He is leading a team of researchers in an effort to completely rethink how to make computers and networks secure, in a five-year project financed by the Pentagons Defense Advanced Research Projects Agency, or Darpa, with Robert N. Watson, a computer security researcher at Cambridge University's Computer Laboratory."

"To combat uniformity in software, designers are now pursuing a variety of approaches that make computer system resources moving targets. Already some computer operating systems scramble internal addresses much the way a magician might perform the trick of hiding a pea in a shell. The Clean Slate project is taking that idea further, essentially creating software that constantly shape-shifts to elude would-be attackers.

That the Internet enables almost any computer in the world to connect directly to any other makes it possible for an attacker who identifies a single vulnerability to almost instantly compromise a vast number of systems.

But borrowing from another science, Dr. Neumann notes that biological systems have multiple immune systems---- not only are there initial barriers, but a second system consisting of sentinels like T cells has the ability to detect and eliminate intruders and then remember them to provide protection in the future."

The lessons here apply to the task of solving many vulnerabilities in our society. That is, there has been a tendency everywhere to try to cure big problems with patches: a holistic approach where everything is redesigned from the ground up is what is needed more often that not, whether we are talking about our national electronic grid or our healthcare system. In addition, durable systems require redundancies and several lines of defense: technicians suffering from hubris often only include one very vulnerable barrier to hackers and malefactors. System designers often suffer from both laziness and arrogance: they don't want to deal with all the problems inherent in their trade and they tend to believe in their infallibility.

(11-14-12)

293. Luxury Car Sales Boom in India

Luxury car sales are taking off in India, though admittedly from a very small base. We suspect that this is in parallel with China where a sizable group of people has enough disposable income to inflate sales of luxury goods. In other words, both countries have swollen the ranks of the nouveau riche.

"Ironically, also in March this year, luxury carmaker Audi registered its highest sales ever of 1002 cars, a growth of 47% over the same period last year, beating Mercedes Benz's sales for the month. In June, Audi overtook BMW's sales for the first time to reach pole position in the Indian luxury car market, dominated by the German trio — BMW, Audi and Mercedes, in that order. In August, Audi sold 726 cars, compared with 510 in August 2011 and 250 in August 2010. While August sales for BMW and Mercedes Benz are yet to be disclosed, Audi is making no bones about its ambitions. According to Audi India head Michael Perschke, "If everything goes according to our plan and strategy, we will become the market leader by 2014." The company is aiming to sell 8,000 units by the end of 2012 and 16,000 to 20,000 by 2015.

While the economic slowdown has impacted automobile sales, the luxury car segment has managed to retain its momentum, growing at a compound annual growth rate (CAGR) of 30%-40%. Total sales stood at 23,000 units in 2011, and is expected to reach 30,000-31,000 units by the end of 2012, according to The Economic Times. The figures may not be large compared to developed markets, but the growth is impressive considering that until 1994, when Mercedes Benz came to India, there were no foreign luxury cars available for sale in the country. In 2006, the Indian luxury car market had total sales of only 3,050 cars. Audi and BMW came in 2006. The market has since grown almost seven times in as many years. Newer entrants like the U.K.'s Jaguar Land Rover (acquired by Tata Motors) are also registering healthy sales. The ultra-premium segment — Aston Martin, Porsche, Ferrari, Maserati, Bentley and Rolls Royce — has also opened shop in India. Their sales are low, but Aston Martin recently launched its Rs. 3.85 crore (US$770,000) Vanquish model — a testament to its faith in India as a future growth center.

Several factors have contributed to this growth. First, people have greater disposable incomes. According to the annual World Wealth Report (2011) by Merrill Lynch and Capgemini, India has the world's 12th largest High Net Worth population, growing at the fastest rate of 20.8%. After a posh new home, a swanky car is often next on the list of aspirational purchases,"---from Knowledge Wharton Today.

(10-03-12)

292. The Man Who Knew Everyone

Even me. We once authored a paper about German academia. The question was what did the professors do under the Nazis, Did they fight the menace? Our tedious paper finally said, "They sat on their fannies." Sir John Wheeler-Bennett who read our paper simply opined, "Good for you. That happens you know. You explore a subject and find out there is simply nothing there. That is all part of the game."

This stately gentlemen, who was near all the striking events second and third quarters of the 20th century knew all the great men who moved events. Victoria Schofield has just written about Wheeler-Bennett in a weakly titled book called Witness to History. Tall and handsome, he walked with a cane or a walking stick, we cannot remember which, in later years. If he was not a spy, he was certainly a funnel for intelligence to the British Government. In Germany until The Night of the Long Knives, he made it out on the night train. This was quite fortunate since he was on the list to be rounded up by Hitler's toadies. Obviously he had advance warning from one of his many friends in the know. For an interesting but rather incomplete summing up of Wheeler-Bennett, look at the Brendan Simms review of the book.

(09-19-12)

291. The Threat of Sunstorms

U.S. regulators are weighing how to insulate our electric grid from sunstorms. "The sun is expected to hit a peak eruption period in 2013, and while superstorms don't always occur in peak periods, some warn of a disaster. (Wall Street Journal, May 15, 2012, p.A3.)

"In a solar storm, charged particles flare from the sun and hurtle into space. When they collide with Earth, the electricity-transmission system acts like a jumbo antenna, picking up currents created when the particles interact with the planet's magnetic field. Those currents can cause wild voltage fluctuations, overheating and permanent damage to transformers, which zip electricity around the grid. The transformers weigh hundreds of tons each and aren't easily repaired or replaced."

(08-22-12)

290. Israel: The Silicon Valley of Water

"On May 18th in Shanghai Israel's second-largest food and drinks firm will launch a high-tech purifier that not only filters water but also heats it to exactly the right temperature for making tea. Strauss has forged a joint venture with China's Haier Group, the world's biggest maker of white goods, to distribute it."

"In 2006 the Israeli government launched a programme to support water companies, for instance by helping them to market their products abroad. It also created (and later privatised) Kinrot Ventures, the world's only start-up incubator specialising in water technologies."

"I wanted to invent more than just a new ringtone," says Elad Frenkel, the boss of Aqwise, a firm that provides gear and expertise to build wastewater treatment plants. Facilities based on the firm's technologies feature what it calls "biomass carriers", thimble-sized plastic structures with a large surface area. In wastewater pools they give bacteria more space to grow and thus allow biological contaminants to be consumed more quickly."

"Emefcy….uses special "electrogenic" bacteria to turn wastewater pools into batteries of sorts. If they work as planned, they could generate more electricity than is needed to treat the wastewater."

"Even a 1% change in flow rate, if persistent, can point to a leak. TaKaDu's detection engine is now monitoring water-supply systems in a dozen places, including London and Jerusalem."

(08-01-12)

289. Online University Education

Online Education is at least 10 years old, and some little startups have done tremendously effective things in this sphere, as we have made clear in previous notes to our readers. Finally colleges and universities are waking up to this opportunity, even acting as if they had discovered something brand new that had not been done before. University professors generally seem ignorant and behind-the-times about online teaching. Now Harvard, MIT, and Stanford are making great noises about all they are doing online. And Tom Friedman of The Times, bringing up the rear as usual, shouts, "Come the Revolution."

"These top-quality learning platforms could enable budget-strained community colleges in America to "flip" their classrooms. That is, download the world's best lecturers on any subject and let their own professors concentrate on working face-to-face with students. Says Koller: "It will allow people who lack access to world-class learning — because of financial, geographic or time constraints — to have an opportunity to make a better life for themselves and their families."
"The universities produce and own the content, and we are the platform that hosts and streams it," explained Daphne Koller, a Stanford computer science professor who founded Coursera with Ng after seeing tens of thousands of students following their free Stanford lectures online. "We will also be working with employers to connect students — only with their consent — with job opportunities that are appropriate to their newly acquired skills. So, for instance, a biomedical company looking for someone with programming and computational biology skills might ask us for students who did well in our courses on cloud computing and genomics. It is great for employers and employees — and it enables someone with a less traditional education to get the credentials to open up these opportunities."

We have not examined any of the online offerings of the traditional colleges We suspect that there is a hitch in all this. That is, old-line institutions have a terrible time translating their offerings into formats that will work in new media. They are tempted to reproduce what they are doing already. Newspapers have had a terrible time adapting their content to the Internet, not understanding how to make it sparkle nor grasping how to make it commercially viable. Professors and college administrators, we suspect, will still feel like they are in the classroom, and produce classroom light for the Internet.

That said, this conversion to online learning is inevitable. Universities are no longer offering a good product, charging too much for much too little. A goodly number of our college graduates are really uneducated, well trained perhaps for a slot in the confines of business, but ignorant of how to think and act in the wider world. The shake-up of the university will require more than a change in its channel of distribution. (See Khan Academy for illustration of how learning can be properly repackaged in videos that economically spreads effective learning. Probably good video and computer learning will come out of small buccaneer enterprises not linked to normal educational institutions)

288. Big Idea Forums

Conferences that bring us gurus with heavyweight, mildly practical ideas are proliferating. TED (Technology, Environment, Design) has been at it for a few years, staging glitzy affairs and speakers equipped with theatrics, oft as not in California. Big tents for ideas are liable to spring up anywhere, the Do Lectures even finding an occasional home in Wales. And there is always Poptech! which regularly holds forth for vacationers in Camden, Maine, so one can pretend to be learning, while all the while snoozing. And it ranges out to Reykjavik for those in search of Iceland's bad food and bubbling hot springs. Of course, all these confabs have a Utopian edge to them and rarely are in the business of convincing us that the world is going to hell in a handbasket.

287. Why Trees Matter?

The Global Province is replete with praisenotes about individual species of trees, about men who love and preserve them, about the ways trees keep our water and air healthy, and about the price we pay when we nude the land of trees. But Jim Robbins, author of The Man Who Planted Trees, has authored a fine, lovely paean to trees in the New York Times:

"What we do know, however, suggests that what trees do is essential though often not obvious. Decades ago, Katsuhiko Matsunaga, a marine chemist at Hokkaido University in Japan, discovered that when tree leaves decompose, they leach acids into the ocean that help fertilize plankton. When plankton thrive, so does the rest of the food chain. In a campaign called Forests Are Lovers of the Sea, fishermen have replanted forests along coasts and rivers to bring back fish and oyster stocks. And they have returned.

Trees are nature's water filters, capable of cleaning up the most toxic wastes, including explosives, solvents and organic wastes, largely through a dense community of microbes around the tree's roots that clean water in exchange for nutrients, a process known as phytoremediation. Tree leaves also filter air pollution. A 2008 study by researchers at Columbia University found that more trees in urban neighborhoods correlate with a lower incidence of asthma."

"Trees are also the planet's heat shield. They keep the concrete and asphalt of cities and suburbs 10 or more degrees cooler and protect our skin from the sun's harsh UV rays. The Texas Department of Forestry has estimated that the die-off of shade trees will cost Texans hundreds of millions of dollars more for air-conditioning. Trees, of course, sequester carbon dioxide, a greenhouse gas that makes the planet warmer. A study by the Carnegie Institution for Science also found that water vapor from forests lowers ambient temperatures."

286. Innovation Re-Visited

Jonathan Lehrer is out with Imagine: How Creativity Works, an unsystematic book about innovation (etc.) but certainly a fun enough affair, not unconnected to the sorts of things Malcolm Gladwell hatches. The most talented critic at the TimesMichiko Kakutani reviews it and fast cuts to a key idea:

"The InnoCentive Web site, started by an Eli Lilly executive in 2001, has shown that solutions to difficult scientific problems (which are posted online, with a monetary reward attached to each challenge) are often solved by people working at the margins of their fields, who were able to think outside the box.

In other words, Mr. Lehrer says: 'Chemists didn't solve chemistry problems, they solved molecular biology problems, just as molecular biologists solved chemistry problems. While these people were close enough to understand the challenges, they weren't so close that their knowledge held them back and caused them to run into the same stumbling blocks as the corporate scientists.'"

As we have said elsewhere on the Global Province, the most striking innovation takes place when an expert from some other field or domain drags a concept from his or her own field and puts it to work in a new pasture.

285. The Omnipresent Growing Invasion of Privacy

Knee-jerk journalists at almost all the major publications as well as live media outfits are over-focused on the ostensible violation of our privacy by the federal government and other official bodies. But the threat from commercial organizations of all sorts is more pervasive and much more insidious. There is some recognition of this in the efforts of governments throughout the world, however paltry, to stem, for instance, the rather outrageous data assemblage of search engines and social networks, all done to peddle advertising of various sorts. This is accompanied by similar data aggregation by numerous other corporations, again for marketing purposes of one sort or another.

"The EU's effort (formally published on January 25th) is part of a global government crackdown on the commercial use of personal information. A White House report, out soon, is expected to advocate a consumer-privacy law. China has issued several draft guidelines on the issue and India has a privacy bill in the works. But their approaches differ dramatically. As data whizz across borders, creating workable rules for business out of varying national standards will be hard."

The Economist further notes, "The EU's 500m residents will also win a brand new right: to be forgotten. Users can not only request that a company show what data it holds on them; they can also demand that it deletes all copies. Critics say this is impractical, vague, and over-ambitious. It is hard to say where one man's data end and another's begin. And once something is online, it is virtually impossible to ensure that all copies are deleted. Small firms will struggle; even big ones will find the planned penalties steep."

The Economist clearly notes that it is not just the U.S. and Europe that have grave privacy issues, but India, China, and other Asian nations confront the same problems, compounded by the fact that several governments there are themselves amongst the worst intruders. Invasion of privacy, on many fronts, is probably the biggest threat to personal freedom throughout much of the developed and underdeveloped world.

284. Money and Politics

Last year the Supreme Court opened up the floodgates to cash-on-the-barrelhead politics with the Citizens United decision which effectively said corporations are people and as such could pour monies into politics. Today the expenditures of some corporations for lobbying even exceed what they make in net profits. It has long been clear that the vast amounts of money that furtively support both candidates and political agendas within these United States have undermined the democratic process. Interestingly, recent articles trace the rise of 'bought' politics, which have a great deal to do with extremist agendas in both our major political parties, to the courtly Lewis Power of Virginia whose zeal for corporate political power much preceded his rise to the Supreme Court. Most recently Jeffrey Clement has studied the rise of moneyocracy.

283. Tink Thompson about the Umbrella Man at JFK Assassination

Director Errol Morris has done an interview with sometime professor, but mostly ironic detective Josiah Tink Thompson who looked into the Umbrella Man, a figure who stood just to the side during the assassination of John Kennedy. People imagine that the Umbrella Man somehow figured in the shooting. But his was an anachronistic protest against Kennedy's father Joe, who as ambassador to Great Britain advocated the appeasement of Nazi Germany at the expense, no less, of the United Kingdom. Bemused, Thompson chuckles about the tendency of modern man to conjure up insidious plots when innocence and eccentricity are really in the saddle. See the video interview with him. Errol Morris chatters about this in a Times op-ed piece.

282. Mercury's the Real Thing

Many of us are not sure that global warming is induced by man or that we can do much about it. There's quite a bit of dispute about how much harm the random waves caused by wireless transmissions, high power lines, and the like cause us, though we personally think, in the end, the physiological effects will be deemed to be great.  But there is no doubt about mercury—in fish or wherever it creeps into our life. Chemical contamination is very real, and it is central to many of our diseases, not just cancer. Mercury is one of its manifestations. About this, the Sierra Club has fairly reasonable things to say.

281. Education is Much Too Important to be Left to the Educators

We have noted that the most interesting reforms for effective education are taking place outside the schools and colleges and training institutes. Khan Academy, the U.S. Army, and other upset-the-apple-cart enterprises are doing the impossible, creating digestible modules for students of very diverse ability and background and repeating the content until it is truly absorbed. Bunker Roy's Barefoot College also defies the educational mafia, educating the illiterate rural poor to become solar engineers, dentists, and doctors. Instead of high technology, he educates through the power of tele-women, sign language, and other conventional means.

280. Sports Safety

Lots of unsportingly-like things have crept into the American sports scene. We have commented on the special effort at the University of North Carolina to bring about safer sports practices in "Shooting Oneself in the Foot, Hoof and Mouth Disease, and other Dilemmas." Gradually a whole array of initiatives are springing up to counter dangerous and unnecessary sports behavior. Lately we are most taken with center Brad Richards, new to the New York Rangers, who has called for an end to hits on the head and also for controls on fighting, claiming that the hockey can still be very exciting without such foolhardy antics. "Richards said the potential effects of repeated head trauma are on the minds of players after a spring and summer in which three hockey enforcers died suddenly: the Rangers' Derek Boogaard, from an accidental overdose of painkillers and alcohol; the Winnipeg Jets' Rick Rypien, an apparent suicide; and the recently retired Wade Belak, also an apparent suicide."

279. -new- Water Shortages & High-Tech Cures

More and more commentary appears that suggests we are headed for a global water shortage. Peter Brabeck-Letmathe, Chairman of Nestle, has been leading the charge for quite a while. He thinks we could run out of water before we run out of fuel. Key is reducing the amount of water used to produce crops and agricultural products. Meanwhile, more and more technical cures are arising to stem water shortages, as reported in The Wall Street Journal. Echologics Engineering and TakaDu are supplying sensors and software that plug leaks that may account for the loss of 7 billion gallons of drinking water a day. General Electric is offering membrane technology to recycle and reprocess wastewater. APTwater Inc. is offerin technology that breaks down trace chemicals. NanoH2O, Aguaporin A/S and AquaZ A/S are developing membranes to help make seawater useable by man.

278. Growing Plants Without Soil

“A new innovative production technology of safe, high quality agricultural crops under minimized water and soil consumption,” Dr Mori exhibited what looks like a sheet of cling-film on which a healthy looking crop of cress was growing. Demonstrating how it was actually rooted onto the material by holding it upside down, it was amazing how the plant seemed to be growing very healthily without any soil at all. The cling-fim like material is actually based on medical-membrane technology, a field in which Dr Mori spent may years working in, and called a “hydromembrane”. Seeds are planted in the hydromembrane which also contains a culture medium with all necessary nutrients and water for the plant to develop. The plants develop a network of fine and dense roots closely attached to the material, and are able to fully develop using a mere one fifth of the water consumption needed in conventional soil based agriculture. The system also forces plants to regulate more sugar and amino acids in order to grow which has the knock on effect of producing particularly high quality crops, tomatoes and strawberries grown using the Imec method are particularly sweet and contain higher nutritional values” Yuichi Mori of Waseda University demonstrated his work at a recent TEDxTokyo conference. (06-22-11)

277. Improving Chip Energy Performance
“A team of Silicon Valley veterans is claiming they can reduce power consumption in computer chips by 50%, potentially extending the battery life of portable devices and helping chip manufacturers keep pace with giants like Intel Corp.”  Wall Street Journal, June 6, 2011, p.B5.  SuVolta says Fujitsu will be licensing its chip making technology, for instance.  “Intel, a leader in miniaturization, in May said it would shift to a new three-dimensional structure in its transistors to boost performance while controlling power consumption.”  SuVolta believes it can accomplish the same thing without such a radical design shift.  Scott Thompson, its chief technology officer, “said he came up with a set of techniques to create transistors that minimize…voltage variations, while requiring few changes to current manufacturing practices.” 

The WSJ failures to mention that there are a host of efforts aiming to save power and reduce heat in the computer space.  For several years, for instance, better capacitors have been coming down the pike. (06-08-11)

276. Big Picture: Plenty of Radiation to Go Around

The radiation chart that follows shows that there are plenty of waves of all sorts milling around earth.  That’s the big takeaway.  As it increases, we as citizens must tone it down wherever we can. The scientists get down in the weeds on this stuff, busily carping that cell phones give us less radiation than a banana (n.b., the potassium in bananas means they carry a little jolt).  The science is not clear on cell phone and many wave- emitting instruments:  American science tends to focus on their short-term effects but their long term impact is the worry, and we don’t study that hard enough. But forget all that.  The real idea to absorb is that a lot of rottengens or whatever you want to call them, are rippling through our lives. To look at the radiation around us, see this chart. Meanwhile, from this chart we can now divine the real meaning of jetlag:  it means you have been dosed to high heavens while flying. (5-11-11)

275. The Irrelevant University

In “College for Cardinals,” we suggested that the modern university has become a horribly expensive oddity, sealed off from society, and not serving the ends of society or much else.  We and others hold this view although colleges and the like are widely celebrated by our politicians and pundits as the way forward for our economy and our society.  There is no better illustration that higher education is producing what we don’t need then the surfeit of PhDs now coming out of university programs which has produced “The Disposable Academic.” America’s annual rate of new PhDs has reached 64,000.   The same pattern of PhD surplus is showing up in all the OCED countries. America’s universities alone can make use of just about 15% of the new doctoral graduates it produces. “Over all subjects, a PhD commands only a 3% premium over a master’s degree.”   Interestingly, we have observed, many colleges and universities now act more like trade schools than centers of higher education, gearing courses and other activities to job getting, rather than academic breadth.  If they are to become vocational mills, then we should be doing the training better and more cheaply in other types of institutions. For this we might find a model in the German educational system.  (04-27-11)

274. America’s Quiet Revolutionary

Gene Sharp is America’s Quiet Revolutionary, so hidden from our view that hardly anybody in Boston (his headquarters) or America even knows about him. Back in 2008, a smart reporter for The Wall Street Journal did a long piece on him, noting that both citizens liberators and dictators the world around very much know about his militant brand of passive resistance. More than one protester in the recent spat of Middle East uprisings knows of him and follows his teachings.  For this reason, “Shy U.S. Intellectual Created Playbook Used in a Revolution,” February 17, 2011, pp.A1 & A11.  We ourselves are particularly looking forward to Mr. Sharp’s forthcoming book Sharp’s Dictionary of Power and Struggle: Terminology of Civil Resistance in Conflicts.”  Sharp made interesting contributions to a recent dinner we hosted in Boston.  Many of our guests harbored good ideas that need to be disseminated about the globe.  Sharp does not quite know how his own thoughts of spread everywhere, but they have. In the face of governments and companies with vast resources, we must understand how future ideas can slip through the barriers of inertia and mindlessness. (3-16-11)

273. Turkey’s Dangerous Game

As we hinted in our “Sounds of Turkey,” the semi-religious government of Turkey is playing a dangerous game both at home and abroad.  As it grows more prosperous, it is veering a bit to the right and undermining Ataturk’s secularism, which has been fundamental to the modern Turkish state.  A trading nation, Turkey has in its diplomatic affairs tried to become the go-between for Iran and the West, and even for China and the West. It sees itself as the fulcrum of the Middle East.  The Svengali leading this grandiose charge abroad is Ahmet Davutoglu, the Foreign Minister and close confident of PM Erdogan.  A reasonably perceptive article about him and Turkey called “Turkey’s Rules” ran in The NewYork Times Magazine, January 23, 2011, pp.32-35 & pp.50-55.  “The truth is that for all his profound knowledge of the history of civilizations, Davutoglu misread the depth of feeling in the U.S. about both Israel and Iran, or perhaps overestimated Turkey’s importance.  This is the danger of post imperial grandiosity.”  While it was the home of the Ottoman Empire, one reels even today when tourist guides and ordinary citizens overstate Turkey’s place in the universe.  It’s nice to see the swelling of breasts that accompanies a vibrant economy, but a small nation that overplays its hand as a middleman may eventually be destined to be squeezed by the nations with which it is jockeying. One would pray that the Turks get some leaders who better understand the relationship of risks and rewards.  (02-09-11)

272. Science Redux

Jonah Lehrer’s The Truth Wears Off:  Is There Something Wrong with the Scientific Method has created quite a stir.  But really, it only documents a little better what we already know.  Scientific hypotheses, even when saluted by scientific peers, must be greeted with healthy skepticism.  Especially where there is money involved, as in research financed by pharmaceutical companies.  Here and there hypotheses that seem to be backed by strong data go up in smoke over time.  Lehrer and others figure that bias (the researcher is bound and determined to prove a strongly held belief) and selectivity (the researcher often lights upon just the chunk of data that supports his or her conclusion) undermine a lot of research where, over time, the results just do not hold up.  Those who have been around scientists and researchers for decades have long since learned that most discoveries have a very short half life, even shorter than unstable elements.  Lehrer, of course, over-reaches.  There’s not that much wrong with the scientific method which, incidentally, assumes that the scientist has an open mind and is willing to look at all the data.  Of course, we are littered with instances of ideological bias where scientists hew to their party lines even when the data is ambiguous.  Certainly that has been true with those on both sides of the debate on global warming.  The real value of the Lehrer article is to remind us that so many scientists are less than empirical and, worse yet, less than collaborative.  The layman has no choice but to give greater currency to notions and hypotheses that have endured a decade or two, but even there half-truths persist.  For instance, we know that the studies in Framingham that said cholesterol was the be- all and end- all in heart disease were simply too simplistic. A single page reproduction of the article can be found here. (02-09-11)

271. States Going Bust

We have heard that California is in trouble, and New York.  But most of us did not know that all the states are really in a financial jam, with truly magnificent budget shortfalls in California, Texas, New Jersey, and Illinois.  Even states that pretend to be provident, such as North Carolina, are among the 10 worst in the union.  Investors, who thought they had a safe, tax-free investment, should think twice.  This has cast a shadow over the municipal bond market.  To see how badly your own state is looking, look at “Where Budget Gaps, and People, Are Few,”  New York Times, January 23, 2011, p.3. However, one should consult the Center on Budget and Policy Priorities, which assures us that a whole round of bankruptcies is not imminent. (01-26-11)

270. Texas on Top?

Texas is ascending the down staircase.  That is, as Michael Barone remarks in “The Great Lone Star Migration,” January 8-9, 2011, P. A13: “Today one out of 12 Americans lives in Texas—the same proportion that lived in New York City in 1930.  Metropolitan Dallas and metropolitan Houston, with about six million people each, threaten to overtake our fourth largest metro area, San Francisco Bay (population about seven million) in the next decade.  Of course, Texas ascending is also Texas descending which Barone fails to note. Poverty, mortality, education, crime, and health statistics would suggest that Americans are migratory to what is at best a Purgatory, well short of Paradise.  The Old South and the Southwest is still mired in abject poverty, with rates running between 16 to 21 percent of the population, highest in the nation. (1-12-11)

269. Unintended Acceleration

Year ago, when Audi ran into a whole slew of complaints about unintended acceleration, it managed to blame drivers, saying that they put the heavy foot to the wrong pedal.  Since the 1990’s, companies, in many fields, have taken to blaming the consumer for mishaps arising in products fatally flawed by bad design..  Most recently, both Toyota and the Federal Government have labelled ‘pedal misapplication’  as the root cause of cars flying out of control.  What’s different this time is that both the Government and Toyota are talking about changing the pedals.  See “Toyota Rethinks Pedal Design,” WSJ, August 17, 2010, pp.B1 and B2. 

It’s about time.  The pedals in many cars—Audi, Toyota, and several others are (a) too small and (b) too close to one another.  In other words, it is all too easy to press the wrong pedal to the metal.  This should have been obvious years ago.  In general too much is jammed in too little space in several car models and, by the way, in a host of other products.  We would even caution drivers to wear light, small, flexible footwear so as not to accidentally hit the wrong pedal..  Unfortunately this tendency to blame the pedals does distract us from software problems and other design mistakes..  Electronic systems in cars  are too fragile., not only because of bad code but because of a bad interface between the electronics and the mechanical systems. (11-10-10)

268. Brazil (and others) Power Plays

Since the Cold War, many, many nations have been showing muscle on the international stage.  China, Iran, and Venezuela are obvious examples, but hardly the most interesting. For that one must look to Brazil and Turkey, countries which have awakened economically in a big way.  They both have been trying to become brokers amongst nations at conflict.  Some of this flurry will give them seats at more tables, allowing Brazil, for instance, to call more of the shots in South America or Turkey, possibly, to move Europe to allow it into the European Community.  Clearly, too, there’s a lot of ego at stake here, and the game may even hurt these countries which much tended to its own game until fairly late in the 19th century. 


“Without attracting much attention, Brazil is fast becoming one of the world’s biggest providers of help to poor countries. Official figures do not reflect this. The Brazilian Co-operation Agency (ABC), which runs “technical assistance” (advisory and scientific projects), has a budget of just 52m reais ($30m) this year. But studies by Britain’s Overseas Development Institute and Canada’s International Development Research Centre estimate that other Brazilian institutions spend 15 times more than ABC’s budget on their own technical-assistance programmes. The country’s contribution to the United Nations Development Programme (UNDP) is $20m-25m a year, but the true value of the goods and services it provides, thinks the UNDP’s head in Brazil, is $100m. Add the $300m Brazil gives in kind to the World Food Programme; a $350m commitment to Haiti; bits and bobs for Gaza; and the $3.3 billion in commercial loans that Brazilian firms have got in poor countries since 2008 from the state development bank (BNDES, akin to China’s state-backed loans), and the value of all Brazilian development aid broadly defined could reach $4 billion a year (see table). That is less than China, but similar to generous donors such as Sweden and Canada—and, unlike theirs, Brazil’s contributions are soaring. ABC’s spending has trebled since 2008.”  (Economist, July 15, 2010).  On the one hand, the foreign adventurism of both Brazil and Turkey are idealistic and constructive.  On the other, they are often playing in the turf of big powers and they may eventually get squeezed. (10-26-10)

267. Japan: Parting the Kimono

The Japanese are not who we think they are.  Or whom they think they are. Everybody—the Japanese, Asian, Westerners—are all outsiders looking in.  “If the Japanese nurse old-fashioned conceptions about their national identity, so do foreigners.  Throughout the 1980s Americans gobbled up books that painted a Japan that was poised to surpass the United States by dint of a superior education system, low crime rate, good labor relations, bureaucratic acumen, familial ties and (let it not be forgotten) racial purity.”  Economist, August 21, 2010, p 68. Contemporary Japan: History, Politics and Social Change Since the 1980s by Jeff Kingman strips away the mythology.  “When the bubble burst, Japan lost paper wealth of $16 trillion, or three times its annual gross domestic product—far more as a share of GDP than the world suffered in the latest financial crisis.”  All of a sudden the high rate of suicides, domestic violence, bureaucratic corruption and ineptness---these all became very apparent.  The income disparity between the rich and the poor has soared, and more and more children are raised in poverty. The scales have fallen from our eyes, in ways that soar beyond Kingman’s book. It is all too apparent that the nation is locked in political gridlock that exceeds that of America and several other developed countries.  As a party system struggles into existence, we become aware that the country has never quite achieved democracy, but has put up a kabuki façade that would make us think it has a functioning constitutional system. (09-15-10)

266. The Electric Car Breaks Out! Personal Mobility

Electric cars have been a long time coming, but now they’re coming, seemingly from every Tom, Dick, & Harry automaker.  “Better Place, based in Palo Alto, which hopes to be the leading infrastructure provider for the world’s growing fleet of electric cars, has raised nearly $700m in two years, making it one of the biggest ‘clean-tech’ start-ups”   Economist, February 6, 2010, pp.71-2. “Industry forecasts suggest that by 2020 about 10% of new care will be either entirely battery driven vehicles or plug-in hybrids…” Better Place will install “thousands of charging points—up to 20,000 for both Israel and Denmark”… and it is also building battery-switching stations. Tesla has a roadster sports car on the market now (costing about $80,000 if we remember rightly) about which we have heard decent reports, even if one had to go back to the factory for a fix. It will be out with a Model S luxury saloon shortly.  The Chinese hope to offer a vehicle in the United States in a year’s time.

The huge bet in the business, however, comes from Renault.  Its Kangoo Be Bop ZE drives well and “provides plenty of space for five people, and their luggage, has a range of about 160 kilometres (100 miles)—and, crucially…will not cost a fortune.”  Carlos Ghosn, boss of both Renault and Nissan, is betting the future of both firms on electric. He is putting plenty of money ($5.9 billion) and lots of brainpower-- some 2,000 engineers-- behind this effort.  At the Frankfurt motor fair, he presented a complete range of cars to come—“a largish family saloon (the Florence), a supermini-sized hatchback (the Zoe), the Kangoo Be Bop ZE and a wacky two –seat urban runabout (the Twizy).”  Economist, October 17, 2009, pp.74-5.  Many in the industry think his predictions of demand are way too high.  “Tim Urquhard of HIS Global Insight…reckons that purely battery-powered cars will command only about 0.6% of world sales in 2020, with plug-in hybrids accounting for a further 0.7%.  Volkswagen…talks of 1.5-2%.”  We would note that the hybrids are not environmentally efficient and may not ultimately do as well as the industry predicts.  “Renault’s chief operating officer, Patrick Pelata…adds that battery technology is undergoing a revolution, with more than 20 big companies worldwide competing to produce smaller, tougher and more powerful batteries.”  The billion dollar question here is how large a market will emerge with estimates for 2020 ranging from 1% to 20% market share:  obviously nobody really has a clue.

The infrastructure to support electric cars is fast emerging.  “The San Francisco building code will soon be revised to require new structures be wired for car chargers.”  New York Times, February 15, 2010, pp.B1&B3. “In nearby Silicon Valley, companies are ordering workplace charging stations…” PG & E, a utility, is now engaged in planning to deal with an outbreak of electric cars.  San Francisco, Portland, and San Diego are in the vanguard of cities preparing for the electrics.  “The first wave of electric car buying is expected to begin around December, when Nissan introduces the Leaf, a five-passenger electric car that will have a range of 100 miles….” About the same time, GM will come out with the Chevrolet Volt, a vehicle able to go 40 miles before its small gasoline engine turns on.  “Tesla Motors…has already sold 150 of its $100,000 roadsters in the Bay Area.” Washington has committed huge subsidies to the electric car efforts of Ford, Nissan and Tesla Motors.

Meanwhile, avant garde efforts are gradually giving birth to wholly different cars—personal mobility vehicles. “Honda and Toyota have each unveiled machines that allow users to travel in whatever direction they choose simply by shifting their body weight. By combining their work in robotics development with their expertise in automotive technology, these two Japanese firms are establishing a growing presence in this burgeoning field.” “The most remarkable feature of the U3-X is its advanced balance-control mechanism, which is a fruit of Honda's long-running work in developing the ASIMO bipedal robot. Enabling ASIMO to move stably on two feet required technology that could sense a shift in the robot's weight and adjust its balance accordingly. Harnessing this technology, the U3-X is able to stand upright on its single wheel when stationary, and when a user sits upon the device and shifts his or her bodyweight, an incline sensor determines which direction the user wishes to go and at what speed. The U3-X itself remains upright, allowing passenger and machine to move as one.”

“In August 2008 Toyota Motor unveiled the Winglet, a two-wheeled personal transport assistant robot. The Winglet is similar in appearance to the US-made Segway. A smaller motor and drive unit, however, has enabled Toyota to make the Winglet much more compact, and at roughly 10 kilograms, its weight is a mere fraction of the Segway's. Since it is only about as wide as the average human being, the device also has the advantage of being well suited for indoor use.” (03-17-10)

Update:  Powering Up the Electrics

AC Propulsion has quietly electrified the car industry.”  USA Today, May 10, 2010, p. 5B.  It has been involved with the Tesla, made “powertrains for the 600 or so BMW minis now in consumer testing,” and is now getting quite active in China. “A Los Angeles investment group with major connections in Asia brought a majority stake in the privately held company in 2005.  Gage says 2010 will be the third straight your of profitability…”  “AC replaces the gas engine with a battery pack, electric motor and power-control systems. The conversions are done one-by-one and aren’t cheap.”   AC is involved with most of the players in the electric car industry. (05-19-10)

265. Richard Posner, The Apostate
We’ve always been very partial to Richard Posner, sometime law professor, a distinguished Federal judge, and frequent author.  That’s not because he gets it right:  he often does not.  But because he is very bright and witty.  And because he can see the writing on the wall.  He’s been amongst the whole bunch out at the University of Chicago (Friedman, Fama, et. al.) who have long believed free markets will solve all our problems—economic, political, and moral-- and the challenge is to get the Government out of almost everything.  

For starters, of course, we have never had so-called free markets in the United States, certainly not during the course of the 20th century.  Further, they are becoming less free---as effective monopolies proliferate and lobbyist dollars buy all sorts of economic favors in Washington.  Our drug prices are only horribly high, because the pharmas have locked out a lot of imports.  Our telecommunication prices are absurdly high and the products bad since the markets fail to function.  Our very lack of free markets has, in fact, been the source of many of our current economic maladies.

With the recent collapse in the financial markets, Posner has cast aside Friedman and brought back John Keynes—with enthusiasm.  Keynes, of course, called on the Government to intercede in extraordinary circumstances when the markets fail to function. The tailspin of the Chicago economists is nicely described in  a recent New Yorker article, “After the Blowup:  The laissez-faire school in turmoil,”  January 8, 2010, pp.28-33  (01-20-10)

264. -new- Greenin’ Up the Cities

As America becomes more urbanized and divorced from truly green spaces, the Audubon Society has tried to bring the country to the city, creating a network of centers closer to every American. Roger Holloway of Atlanta is not only trying to bring back the American Elm, but he is getting them planted in America’s cities, even right next to the White House.  On the one hand, we’re stripping the land to make new poorly thought out developments with pernicious consequences such as flooding, pollution, global warming, ugliness, and more.  But green things are happening amidst the squalor.  In this vein, Farm City: The Education of an Urban Farmer illustrates how green shoots are rearing their heads in cities in curious unplanned ways.  In Dwight Garner’s review for the New York Times, June 12, 2009, p. C30, we learn that Ms. Carpenter’s book is a review of “how she raised not only fruit and vegetables but also livestock on a small, scrubby abandoned lot in Oakland…..”  This takes place amidst “gunfights and drug dealers,” in Oakland with “the highest murder rate in the country.”  A local chef, Chris Lee, allows her to raid the dumpster behind his restaurant Eccolo for leavings which she can feed to her pigs.  Ms. Carpenter has no truck with those who want to move to the country:  the land out there only represents loneliness to her.  She wants her stalks in the city.  For a larger look at the farm movement in Oakland, see “A Garden Grows in Oakland,” where we discover that  “since 2001, more than 80 urban farms have been cultivated in the backyards and vacant lots of West Oakland.” According to the Wall Street Journal, “West Oakland's City Slicker Farms, a non-profit organization, was founded in 2001 by a local community activist to help combat blight in the neighborhood. Operated by about 200 volunteers and five full-time employees, the group bought a half-acre lot at a tax sale with the intention of planting produce and selling it to local residents at a discount. The outfit has now grown to five community farms throughout West Oakland, collectively churning out some 6,000 pounds of produce a year, it says." (09-30-09)

263. States in the Whole

In “State Budget Troubles Worsen,”   we learn that 44 out of the 50 states will run sizable deficits in their budgets in the current or upcoming fiscal years, the situation having grown considerably worse over the last 6 months. Still in surplus are Texas, North Dakota, Alaska, Montana, Wyoming, and West Virginia.  The cumulative deficits of all states—already very substantial—are projected to double in fiscal 2010 and 2011.  Those investing in municipal securities or sundry state obligations should look carefully at states where deficits as a percentage of the general fund are particularly high such as California, Arizona, Georgia, and Utah where double digit figures are contemplated. Additionally double digit budget gaps will beset a large number of states in 2010, these also meriting special scrutiny. (05-20-09)

262. Self Cleaning Walls and Trains

“Self- Cleaning Walls and Windows: Photocatylsts Used on Buildings and Trains,” Trends in Japan, January 2009. “The key to these self-cleaning surfaces are photocatalysts, substances that mediate chemical reactions and are activated by light energy. When organic matter comes into contact with a photocatalyst, it is oxidized at an increased rate and decomposes into water and carbon dioxide.” “TOTO Ltd., a major manufacturer of toilets, baths, and other sanitary ceramics, was the first company to commercialize photocatalytic paint for outside walls when it released Hydrotect Color Coat ECO-700 on to the market in 2002. Then in 2007 it put on sale ECO-EX, which boasts even greater cleaning power.” “Toto estimates that more than 13 million square meters of building walls have been coated with products in the Hydrotect Color Coat series nationwide, producing a total cleaning effect equivalent to that of 710,000 poplar trees.” (04-15-09)

261. Selling Ideas:  Do As I Say Not As I Do

McKinsey is an incredibly ponderous consulting organization whose big selling point is that it puts lots of grey haired, nice looking executives on a client’s account.  Years ago our surveys revealed that you go elsewhere if you want to get something done.  So, naturally, it has done an unwieldy article on communication with a top-heavy title based on an interview with a Stanford professor who started out as an engineer but drifted into psychology.  It’s called Crafting a Message that Sticks:  An Interview with Chip Heath, McKinsey Quarterly, November 2007.  If translated, it comes down to the idea that a good message ultimately has to be poetry.  Here is sort of what brother Chip thinks will get you a big audience, as lifted from the article, with some of the wordiness eliminated:

  1. Simplicity. Messages are most memorable if they are short and deep.  Glib sound bits are short, but they don’t last.  Proverbs such as the golden rule are short but also deep enough to guide the behavior of people over generations.
  2. Unexpectedness.  Something that sounds like common sense won’t stick.  Look for the parts of your message that are uncommon sense.  Such messages generate interest and curiosity.
  3. Concreteness.  Abstract language and ideas don’t leave sensory impressions; concrete images do. 
  4. Credibility.  Will the audience buy the message?
  5. Emotions.  Case studies that move people also involve them.
  6. Stories.  Heath writes.  “Stories act as a kind of mental flight simulator….”

 

We should caution you, however, that these prompts will mostly help you with tactical communication.  They’re not the way to get across big, long-term, strategic ideas.  One is compelled to think more deeply about communication than this article suggests if you want to communicate about substantial matters.

The rules of communication are not immutable but change quite a bit in changing environments.  So many messages are now thrown at us daily that you have to style your thoughts to get through the chaff.  Moreover, each of us is a victim of an environment that makes us shallow, and turns us into email freaks all too ready to send out instant messages that lack weight and substance.  Because a plethora of words and digital daggers surround us, we must resort to pictures in expressing ourselves, but pictures that embrace more than the eyeballs.  To this end, take a peek at “In Photography, What Puzzles the Eye May Please the Mind,” New York Times, January 1, 2008, p.C5.  “ “Another paradoxical strategy for captivating viewers is to show them something they can’t immediately understand.”  This was the subject of a show at the Yale Art Gallery entitled “First Doubt: Optical Confusion in Modern Photography.”  “It was drawn mostly from the collection of Allan Chasanoff, who focused on acquiring confusing pictures….”   It is arguable that communications—where pictures or words—that are too accessible cannot access the deepest recesses of an audience’s mind or soul.  Some pictures from  “First Doubt” can be seen here. (04-01-09)

260. Standing Pat

“What’s the best way to stop a penalty kick?  Do nothing:  just stand in the center of the goal and don’t move….” That is the surprising conclusion of “Action Bias Among Elite Soccer Goalkeepers:  The Case of Penalty Kicks,” a paper published by a team of Israeli scientists in Journal of Economic Psychology.”  This idea has much wider implications.  There are a whole host of circumstances where those who master inaction carry the day.  Senator Pat Moynihan counseled benign neglect for certain social problems, quite certain government could only make things worse, and that time was the best healer. Elizabeth I, always pressed by her advisors to go to war and take precipitate action, dallied fruitfully, making her one of England’s greatest rulers. It is almost a certainty that outside powers who take up the cudgels in the Middle East will live to regret it:  far better to let the squabbling tribes there savage away at one another.  Investors who do let money burn a hole in their pockets often suffer less acute losses than the gun slingers. New York Times Magazine, December 14, 2008, p.57. (04-01-09)


259. Fighting Recessions with Innovations

There’s a lot that’s counterintuitive about the 21st century.  So many of the lessons we learned too well in the 20th just don’t hold water anymore.  We have been noticing for several years that the stock market has been offering the best premium to companies with intellectual property—not to the giants with huge sales and earnings.  It is paying for innovation if it smells that the innovation really could result in a burst of revenues for someone.  This realization makes the McKinsey Quarterly’s “Innovation Lessons from the 1930s,” December 2008 a worthwhile read. “Many companies hesitated to innovate during the 1930s. Consider, for example, patent applications as a proxy for resources devoted to innovation. The growth rate of US patent applications by companies with R&D laboratories was considerably lower during the 1930s than in the preceding decade.”  “Yet several successful companies did not delay such investments. One was DuPont. In April 1930, a noted DuPont research scientist, Wallace Carothers, recorded the initial discovery of neoprene (synthetic rubber). Although the company’s price levels and sales fell by roughly 10 and 15 percent, respectively, that year, DuPont boosted R&D spending to develop the new technology commercially.”  “In total, US companies founded at least 73 in-house R&D labs each year from 1929 to 1936.” With the dismemberment of Bell Labs and the decay of r & d on several fronts,  smart entrepreneurs should contemplate the formation of development intensive companies that, in some instances, are entirely devoid of normal operations such as manufacturing and the like. (02/18/09)

258. Cell Phone—Locked in our Cells

The Global Province has frequently cited the ills imposed on us by the cell phone industry.  Basically we are suffering from all the problems and  none of the virtues of monopoly---something Judge Greene tried to remedy for ordinary phones when he broke up AT&T years ago.  What we have today throughout telecommunications is a re-concentration of all aspects of the industry without the fairly benign regulatory umbrella that once provided Americans from Coast to Coast with universal, rather reliable, inexpensive phone service.  Nowhere is this seen more clearly that in cell phones or mobile phones where we are paying very high prices for unreliable cell phones, networks with poor U.S. coverage that frequently drop calls, bills that arrive in the mail with incomplete information, the distinct possibility that the phones as provided are unsafe causing brain damage or cancer, and tedious marketing tactics that border on dishonesty.  It can be further argued that the industry has become a drag on the economy since we depend on a cheap, reliable, transparent infrastructure to make commerce flourish and to enhance the spread of ideas that lies at the basis of productive capitalism.  A host of information about cell phone practices and about its social impact can be found on the Global Province.

In this vein, consumers should consult “What Carriers Aren’t Eager to Tell You About Texting” New York Times, December 28, 2008,  p.BU 3.  There is it is revealed that carriers have hiked their charges to lofty levels even as they have experienced a surge in volume. “All four of the major carriers decided during the last three years to increase the pay-per-use price for messages to 20 cents from 10 cents.”  “20 class-action lawsuits have been filed around the country against AT&T and the others carriers, alleging price-fixing for text messaging services.”  Professor Srinivasan Keshav of the University of Waterloo in Ontario, “whose academic research received financial support from one of the four major American carriers, discovered just how secretive the carriers are,” having been turned down by his sponsor when he asked for data on its network operations.  (02-04-09)

257. Space Satellite Energy

“Let the Sun Shine In,” The Economist Technology Quarterly, December 6, 2008, pp.16-18.  When we talk about solar power, we usually are thinking about how we capture the sun’s rays on earth to generate energy.  For years the notion of “satellites that beam solar power” to earth has fluttered around the councils of dreamy government scientists, but little has come of it.  Now far- out thinkers speculate that, under the right circumstances, the cost of space power could get down to 8 to 10 cents, which puts it within hailing distance of commercial power. Current scenarios, however, put SSF power cost at about 50 cents per kilowatt hour.  Defense planners also realize that space power could look very cheap when stacked against the immense expenditures we put forward for electric power in unfriendly landscapes such as Iraq. For this reason the Defense Department has done a serious evaluation of the possibilities of SSF power. “The concept of beaming gigawatts of solar power down from space was first put on a sound scientific footing by Peter Glaser of Arthur D. Little…in 1968.”  Little, by the way, was once America’s best technology consultant., making it and Bell Labs America’s two biggest losses technologically. 

With the vast increase in efficiency of solar cells and solid-state amplifiers, such a power source seems less pie in the sky.  The major big impediment to such systems is the cost of lifting satellites into orbit.  Launches are very expensive.  “According to the FAA there are about 18 companies involved in developing low-cost launchers.”

Meanwhile, other types of entrepreneurs are flirting with far-out power, if not quite so far.  “Ottawa-based Magenn Power is building an airship to generate energy from high-altitude wind.” Fortune Small Business, December 2008, pp. 68 & 70.  “CEO Pierre Rivard’s helium-filled rotating blimps will hover at up to 1,000 feet---conventional turbines remain suspended at 300 feet—and use fabric sails that transmit energy to the ground via high-voltage cable tethers.” Wind currents stay constant at such heights, unlike wind on the ground. 

Other high altitude wind startups are in the works.  In the Research Triangle, “WindLife Kite Engine Co. will unveil a smaller kite system to help off-grid communities in India power water pumps.”  “Similarly, Italian company Kite Gen Research aims to build 100-megawatt electric plants that use software and onboard avionic sensors to automatically pilot multiple generator kites in half-mile-diameter paths. And Google invested $15 million in Makani Power, a secretive wind-energy company in Alameda, Calif.”  “Then there’s Sky Windpower in Murrieta, Calif., which wants to use a tethered 100-kilowatt rotorcraft to draw wind power at an altitude of up to 30,000 feet.”  “The Drachen Foundation, a nonprofit Seattle kite-power education group” is trying to stimulate broad interest in altitude wind power. (01-21-09)

256. The Awkening of Brazil
Previously, we have commented that Brazil, at last, is reaching out for its destiny.  Sure, it still has a surfeit of grinding poverty and conspicuous crime.  But with Petrobras’s energetic exploration and ambitions, it now has become the 3rd largest company in the Americas. Embraer, the big guy in regional aircraft, has become a aeronautics force to reckon with. In a “Strong Economy Propels Brazil to World Stage,” New York Times, July 21, 2008, pp. A1 and A12, we learn that our national media are finally catching up with the colossus to the South, which has cast Argentina, which at the beginning of the 20th century was still South America’s best hope, deep into the shadows.  The income disparity between its wealthiest and its poorest is modestly narrowing, and the economy grew 5.4 percent last year.

“The number of Brazilians with liquid fortunes exceeding $1 million grew by 19 percent last year, third behind China and India….”  Billionaires are on the way, to include exotic chaps such as Joao Carlos Cavalcanti.  (See New York Times, August 2, 2008, p. A8.)  “A geologist by training, Mr. Cavalcanti—who goes by J.C.—applied his knowledge and considerable gumption to discovering huge reserves of iron ore and other minerals.  Today he pegs his net worth at $1.2 billion, placing him among the 20 richest men in Brazil.”  Others newly minted billionaires include Eike Batista , an oil entrepreneur, who is reputed to be worth $6.6 billion.  Antonio Ermirio de Moraes, chairman of the diverse Votorantim Group, is thought to be worth $10 billion, ostensibly making him the richest man in South America. Despite all his wealth and his boundless collection of cars, Cavalcanti and his wife are deeply interested in spiritual matters.  They have established a foundation that is caring for a vast number of abandoned animals.  (11/19/08)

Update: Big Banco Itau

Brazil has put together a mega bank, and, at least for now, its banking system is relatively stable. Banc Itau, “fresh from its merger with Unibanco, the Sao-Paulo-based bank has emerged as the biggest bank south of the Mexican border.”  New York Times, March 5, 2009, p. B2. “The market value of its parent, at just around $28 billion, is nearly equal to the combined worth of Citigroup and Bank of America.”  It has branches already in Argentina, Uruguay, and Chile.  The Spanish banks, which have made strides in Latin America, are not much of a force in Brazil.  Citicorp bought Grupo Financiero Banamex in 2001, but Citi is short on capital. (06-03-09)

255. Deep-Sea Oil Drilling
More than half of petroleum activity is now offshore.  The most spectacular find in recent times is the Tupi Field uncovered by Petrobras off of Brazil, and it tells us where the world’s remaining big oil finds are going to come.  We should understand, of course, that over the last century or so we used up half the world’s oil, and we will consume the other half by perhaps 2050, since we are consuming at a faster rate.  Global oil consumption will jump 35% by 2030 according to the International Energy Agency.  As Boone Pickens has said, we cannot drill out way—even offshore—out of our energy crisis.

In fact, the smart money is very much betting that oil is on its last legs.  Everybody with half a brain has bought into Mr. Hubbert’s peak oil notion.  Investment banker Matthew Simmons not only has bought into peak oil, but he believes reserves are declining faster than the oil majors are admitting.  In 2002, sifting through all the data, he concluded, for instance, that all the major Saudi fields had seen their best days, all of which he later summed up in Twilight in the Desert: the Coming Saudi Oil Shock and the World Economy.  He points out as well that there are several impediments that are slowing down exploration and development at any rate—lack of drilling rigs, a shrinking pool of geologists due to retirements, old-hat technology that dates back to the 1970s.  “Mr. Simmons … holds out great hope for wave energy, and he believes that at least one of the many different species of seaweed found along Maine’s coast will yield oil that can be turned into biofuel.”  See The Economist, July 12, 2008, p. 77.  He might add that 14 of the top 20 oil producers are now state-owned giants, many of which are not inclined to use up their reserves in a hurry, leaving Western companies in control of 10 percent of the world’s oil and gas reserves.  A digest of Simmons speeches can be found on his website.

The U.S. goliath Exxon, while focusing on cash flow above all else for years and trying to build reserves through acquisitions, is now ramping up exploration.  It will increase spending by about $1 billion a year to explore in politically stable countries such as Germany, New Zealand, and Greenland for oil and gas.  It announced a capital budget increase of 25% per year (Wall Street Journal, March 6, 2008, pp. B1-2), up from the 20% it had slated a year ago.  While Exxon has done a pretty good job for its shareholders, it is far from clear that it has done much for the U.S. economy or U.S. society, since it clearly has not been investing its cash reserves in the sundry technologies that might smooth the path to a different energy mix.  (10/8/08)

Update:  Deep Sea Exploration

We have called this entry “Deep Sea Oil Drilling,” but it really should cover the whole field of exploration—scientific and commercial.  Indeed, we are probing the deep---not just for oil—but to reveal its several mysteries and to set the stage for harvesting other valuables including minerals. In that vein, we should read Willam Broad’s delightful “Mapping the Sea and Its Mysteries,” New York Times, January 12, 2009. It hints at some of the things subsea scientists are doing and discovering.  “Today, Dr. Earle notes that … Prochlorococcus, so small that millions can fit in a drop of water — has achieved fame as perhaps the most abundant photosynthetic organism on the planet. It daily releases countless tons of oxygen into the atmosphere.” Dr. Earle is co-author of the recently published Ocean: An Illustrated Atlas.  “In the 1980s, she helped found two companies to make innovative vehicles that could open the sea’s dark recesses to human exploration, and ever since has sought to illuminate the abyss.” Wikipedia has a more expansive description of her exploits:  “In 1985 she founded Deep Ocean Engineering along with her husband, engineer and submersible designer Graham Hawkes, to design, operate, support, and consult on piloted and robotic sub sea systems. In 1987 The Deep Ocean Engineering team designed and built the Deep Rover research submarine, which operates down to 1000 meters.” “In 1992 she founded Deep Ocean Exploration and Research to further advance marine engineering.”  “Earle has led more than 400 expeditions worldwide involving in excess of 7000 hours underwater in connection with her research.”   See her website for interviews and reviews. (03-18-09)

Update: Graham Hawkes
Hawkes,  Dr. Earle’s husband, is fascinating in his own right, and surely has as much to do with stoking our interest in the depths as the good doctor. See, for instance, John Sedgwick’s “Sub Prime,” Forbes, April 21, 2008.  “The world's most advanced personal submersible sits on the floor of Hawkes Ocean Technologies' spacious workshop adjacent to the yacht-filled harbor of Point Richmond on San Francisco Bay.” “The grand eminence in his field--perhaps the only eminence--Hawkes has personally designed and built three quarters of all the personal manned submersibles ever made, totaling more than 60 craft. But the Falcon is by far the most ambitious.”  Piloting a Hawkes vessel is turning out to be the new sport of millionaires, yet a bit more exciting than going up in a space capsule.  TED had done a video with Hawkes that provides a demonstration of his doings.  While you finish looking at Hawkes, also take a trip through the depths with Robert Ballard:  he’s into robotic exploration. (05-06-09)

254. Safe Pesticides—Japan
In recent years, both consumers and farmers have increasingly turned against the use of chemical pesticides out of awareness and concern about their safety and environmental impact.  To address these concerns, Japanese researchers recently developed the world's first pesticides that use lactobacillus bacteria instead of harmful chemicals.  This follows previous successes in developing pesticides that use microorganisms like Bacillus natto and soft rot bacteria.

How Lactobacillus Pesticide Works
The lactobacillus used in the pesticides is selected from among the various types of lactobacillus that can be extracted and collected from yogurt, pickles, and other fermented foods, with specific varieties being chosen to protect crops from specific diseases.  For example, spinach wilt is an infectious soil-borne disease caused by Fusarium fungi.  Previously, the only effective means of dealing with it was considered to be disinfecting the soil with chemical pesticides.  Now, though, the bacteria Pediococcus pentosaceus KMC05 can be utilized to contain an outbreak.  KMC05 can also be used against Phyophthora capsici, a soil-borne infection caused by Phytophthora pathogens.

Lactobacillus plantarum WB10, meanwhile, is even more effective than commercial pesticides in eradicating pythium, the cause of mizuna soil rot, outbreaks of which are believed to have increased as a result of repeated cropping and year-round cultivation in greenhouses.

As for other soil-borne infections, SOK04, another type of lactobacillus, can be used to combat soft rot in Chinese cabbage.  These lactobacillus pesticides are as effective or even slightly more effective than Biokeeper water-dispersable powder, a previously developed microorganism-based pesticide, and these results have been confirmed in infected fields in five prefectures around Japan.  Tests have proved that these pesticides are effective in eradication of diseases either when sprayed or when seeds are soaked in them.  (From Trends in Japan) (9/24/08)

253. The HurriQuake Nail—Best of 2006
Clemson graduate Ed Sutt ginned up the best innovation of 2006 according to Popular Science, and it has been added to Bostitch’s bag of tricks. Bostitch is now part of the old and famed Stanley Works.  It’s a nail that won’t come out when winds and quakes start shaking the building.  “The HurriQuake features angled rings to help the nail resist pulling out in wind gusts up to 170 mph.  The top of the nail shank is twisted, which helps reduce wobbling by boards, and the nail head is about 25 percent larger than the typical sheathing nail.”  (See the Charlotte Observer, December 30, 2006, p. H1.)  Sutt was mentored by his teacher Scott Schiff at Clemson who works in the in the Clemson Wind Load Test Facility.  “After Hurricanes Hugo and Andrew, Clemson developed the Wind Load Test Facility to work toward more hurricane-resistant wood frame homes.” (7/30/08)

252. Dunking the Drinking Age
There has long been a terrible contradiction to an American society that says 18-year olds are mature enough to lose their lives in war—and many do—but are not old enough to drink or, sometimes, to vote.  Nor can they even rent a car.  We inveigh against sexism and racism, but not age-ism—a condition where both young adults and very old adults are treated like infants.  “In the early 1980s more than half the states had drinking ages lower than 21.  Some let the boozing start at 18; some allowed 19-year-olds to buy beer and wine.  Spurred by Mothers Against Drunk Driving (MADD), the Reagan administration in 1984 to raise the drinking age to 21 or lose 10% of their federal highway funds.  The states buckled under….,” falling victim yet again to an unconstitutional invasion of states’ rights by the Feds.  Naturally drinking problems have only gotten worse, with huge binge drinking on campus that only expands each year. “John McCardle, the former president of Middlebury College in Vermont, is leading a national effort to lower the drinking age to 18” (The Economist, April 19 2008, p. 43).  His group is called Choose Responsibility.  Similarly, efforts are underway in Missouri, Wisconsin, and South Carolina to overturn the misguided regulations.  MADD, Mothers Against Drunk Driving, continues to lead the charge for the age limit of 21, though some of its statistics to support its attitude are rather suspect.  Prohibitionists, trying to eradicate several entrenched habits, continue to seek bad public policy that creates more problems than it solves.  (7/16/08)

Update: More Fur Is Flying
While it seems that putting up the legal age to 21 has cut motor vehicles deaths, it has hardly helped the drinking problem. A considerable number of college presidents and policy experts think it has exacerbated binge drinking at colleges and even high schools.  In a “Bid to Reconsider Drinking Age Taps Unlikely Supporters,” Wall Street Journal, August 21, 2008, p. A3, we learn that “more than 100 (123 we believe) college presidents, including leaders at Dartmouth, Duke and Middlebury, have joined the month-old Amethyst Initiative, which argues that ‘the 21-year-old-drinking age is not working” and “has created a culture of dangerous binge drinking.”  They are arrayed against a huge block of forces that want the 21 age limit, whatever the consequences.  This prohibition dates back to 1984 when Congress voted to hold back 10% of the highway funds of any state with a drinking age lower than 21.  Even with the higher drinking age, some 800,000 16-20 year olds have lost their lives each year due to drunk driving both in the 1990s and in this century.  While a revision in the laws is unlikely now, the college presidents have stirred up a hornet’s nest.  Scout Archives reviewed the current debate:

For the past two decades, there hasn’t been a great deal of discussion regarding the drinking age in the United States. In 1984, The National Minimum Drinking Age Act effectively established a nationwide limit by removing 10% of the annual federal highway funding from states that chose to set their drinking age below the age of 21. In recent weeks, a rather unusual group has come together to spark a new debate about this rather tempestuous topic: college presidents. This summer, the Amethyst Initiative released a statement signed by over 100 college presidents stating that “the 21 year-old drinking age is not working, and, specifically, that it has created a culture of dangerous binge drinking on their campuses.” The Initiative is not in favor of advocating for a particular policy change or modification, but rather asking for “informed and unimpeded debate” on the subject. A number of organizations were quick to respond to the document, including Chuck Hurley, the chief executive of Mothers Against Drunk Driving (MADD), who noted that he was “profoundly disappointed” in the initiative.

The first link will take visitors to a piece from this Wednesday’s Baltimore Sun which discusses various reactions to the signed statement from the Amethyst Initiative. The second link leads to a news article from the Wednesday edition of the Los Angeles Times about those college presidents in California who offered their signatures to this statement. Moving on, the third link leads to an extended investigative piece from ABC News which talks to university officials, parents, students, and policy makers about this subject. The fourth link will lead visitors to a press release from MADD that offers expert testimony from scientists and others regarding the effectiveness of the 21 year-old minimum drinking age in saving lives. The fifth link leads to the homepage of the Amethyst Initiative. Here visitors can view a complete list of college presidents who have signed the statement thus far, and also learn more about their work. The sixth link leads to a summary of The National Minimum Drinking Age Act of 1984 written by Dr. David J. Hanson. Dr. Hanson’s entire site is worth a look, as he provides information about a wide range of alcohol issues. Finally, the last link leads to the homepage of the Harvard School of Public Health’s College Alcohol Study. Here visitors can read some about some of their latest findings and also look over additional resources.  (12/17/08)

251. Reviving Small Towns
“Just 17% of America’s population today lives outside metropolitan areas.”  “Some organisations are trying to help small towns along.  One of the most important is the National Trust Main Street Centre, which aims to revitalise central streets by preserving historic buildings.”  See The Economist, December 23, 2006, pp. 41-42.  For towns that cannot find fatcat buyers to revive them, art and sometimes alternate energy have provided a means of revival.  “The town of Nelsonville, in southern Ohio, has become an ‘artists’ Mecca’ in recent years, according to Will Lambe, a research associate at the University of North Carolina who is working on a book about small-town economic development.”  “Colquitt’s Swamp Gravy Institute now finds itself acting as a consultancy for towns as far away as Brasil….”  (4/2/08)

250. The Sun Will Come Out Tomorrow
“The sun will come out, tomorrow / Bet your bottom dollar / That tomorrow, there’ll be sun/ Jus thinkin about, tomorrow / Clears away the cobwebs and the sorrow / til there’s none” - Annie.  To almost everyone everywhere the world seems a mess, beset by intractable problems ranging from global terrorism to outright war to global warming to starvation to AIDS.  But the Economist (January 27, 2008, pp. 27-29) “in a week of financial uncertainty … [looks] behind the headlines to a world that is unexpectedly prosperous and peaceful.”  China, a quarter of a century ago, had 2/3 of its population living on less than $1 a day: now the number is less than 180,000,000.  In the first part of the 21st century 135 million worldwide have escaped extreme poverty.  With the exception of Africa, better water and better public health systems are reaching considerable numbers of people.  Child mortality (children under five) has declined radically.  The population bomb is fizzling with declining birth rates.  “In East Asia and the Pacific, the rate was 5.4 in 1970.  Now it is 2.3.  In South Asia, the fertility rate halved (from 6.0 to 3.1).”  In the last 25 years the rate for the whole world has fallen from 4.8 to 2.6.  “Last year the global economy entered its fifth year of over 4% annual growth—the longest period of such strong expansion since the early 1970s.”  “Economic growth improves lives unobtrusively.  The more dramatic explanation for improved living standards is the decline in the number of wars, and in deaths from violence and genocide.”  “The number of conflicts (both international and civil) fell from over 50 at the start of the 1990s to just over 30 in 2005.  (2/27/08)

249. Barring the Best: Immigration
The secret of success for the United States has always been its immigrants who come to these shores and do amazingly big things.  For starters John Roebling, who built the Brooklyn Bridge, made his way over from Germany.  As well, one need only read Frank McCourt’s Angela’s Ashes or see the bleak but inspiring movie based on it to understand just how much hope this country inspires for those escaping poverty, oppression, and an unfeeling society.  It’s the land of friendship and opportunity.

Til lately.  Several immigrants, such as entrepreneurs from China, are going back to their homeland, because things are going better for them there.  It’s pure drudgery now to get a green card—that precious document needed by immigrants who have not attained citizenship, even for those who bring us precious skills and who have enough income to be net contributors to our society.  Bright students and scientists have a devil of a time coming here for jobs or education, and are going to other countries. This distrust at our gates has gotten particularly acute since the events of 9/11.  We would point you to the Globalization Research Project, which has tackled this question, studying the impact of our unfriendly immigration policies.  On the Project website, one will discover a paper entitled “Intellectual Property, the Immigration Backlog, and a Reverse Brain-Drain: America's New Immigrant Entrepreneurs,” which goes right to the heart of the problem. (12/12/07)

248. Manufacturing Is Dead: Long Live Manufacturing!
As we have suggested many times, much of our manufacturing has moved overseas, and we are becoming a service economy.  That is to say, our output is shifting to service, and service jobs are what people can get.  Nonetheless, in dollar volume, manufacturing is up, and skilled tradesmen are very much in demand.  That is, there is a living to be made by the worker, and by the businessman, who makes higher value, more complex products. Bill Steigerwald and Joel Kotkin have made this point on Town Hall, as our reader Charles Wheat recently pointed out to us.  “In fact, in parts of the South, the Great Plains and Pacific Northwest, high-skilled workers are fueling vibrant local economies and helping America make $1.6 trillion worth of industrial stuff—42 percent more than in 1982.”  “Everyone talks about how we’re becoming a society of low-end service workers and high-end information workers.  But here’s something in between—basically the logistics and manufacturing industry—and nobody seems to be focused on it.”  “What is going on in manufacturing is what happened to farming over the last 220 years—we’re producing more with fewer and fewer people.”  (12/5/07)

247. The Bovine Menace
“Forget SUVs and tractor-trailers—the world’s livestock play a larger role in global warming than all of our planes, trains, and automobiles combined," according to a report from the Livestock, Environment and Development Initiative (LEAD).  With deforestation, fossil fuels for fertilizer, and gases from manure, “livestock are responsible for 18 percent of greenhouse-gas emissions worldwide.”  See the Atlantic, March 2007, p. 30.  (10/31/07)

246. Suicide in Nippon
“Let’s Die Together,” The Atlantic, May 2007, pp. 92-98 deals with Japan’s penchant for group suicide, a category in which the world’s second largest economy is a clear leader.  The article is suggestive but ultimately unsatisfying, because it graphically lays out the phenomenon, but does not understand very well why it occurs.  Moreover, on a more philosophical plane, it does not think through whether Japan is simply more explicit than other nations about its suicidal intentions.  In the United States, eating oneself to death is suicidal, but we don’t call it that.  There are a raft of behaviors in nation after nation that could are implicitly suicidal.  And, of course, there are phenomena like global warming, etc. in which the whole world is bent on a suicidal path.

“From 2003 through 2005, 180 people died in 61 reported cases of Internet-assisted group suicide in Japan.”  “Japanese authorities have been slow to react with any notable alarm to a recent nationwide embrace of death that has caused the official suicide rate to increase by an average of 5 percent a year for the past decade.  More than 32,500 suicides were reported in 2005….”  “The only countries with higher official suicide rates are Sri Lanka, which is mired in an unending civil ware, and the former Soviet republics and their Eastern European satellites.”  This embrace of death occurs even as Japanese fertility rates plummet to new lows.

The publication of Wataru Tsurumi’s The Perfect Suicide in 1993 was to some event a seminal event or catalyst in the rush to suicide.  It is painfully detailed about methods and appears to have sold 2 million copies or so thus far.  He has become a celebrated speaker.  (8/22/07)

245. College Endowments Raided? 
During the last decade givers and their families have complained that their handsome gifts to universities have been diverted to kooky ideas never intended in the bequests.  More than one has sued for return of the gifts.  This theme was addressed in “Strings Attached: Givers and Colleges Clash on Spending,” New York Times, November 27, 2004.  Paul Glenn has taken USC to task over the use of his $1.4 million gift; Yale had to repay Lee Bass $20 million he had given to support traditional humanities; the heirs of Charles and Marie Robertson want $35 million back compounded (to $600 million or so), bothered that the gift has been used outside of the Woodrow Wilson School and that it has not avidly been used to promote service in the federal government.

These contests between benefactors and academia opens a whole can of worms.  With a lot of money to throw around, administrators have gotten a little footloose and fancy free with the bequests of others.  But, properly, some institutions have disputed the nature of the original gift: circumstances change, and dollars deeded with the best of intentions in one era often are attached to provisos that just don’t make sense in a new age.  We tend to think the Mellons have done a pretty good job with their money, but many a donation is not particularly astute.  As we will make clear elsewhere, some institutions have become nothing better than banks—with growth in endowment becoming more important than the original mission of the institution.  Vital activities in institution after institution are underfunded: there is hardly a college in the country with healthcare facilities equal to its needs—and both students and staff get shortchanged.  Finally, of course, we have yet to properly redefine the mission of the university in our age.  Society is probably getting a thin return on its dollar.

Asset raids are even more acute within churchdom.  Often clergy will be appointed to a sinecure that is richly funded—or which could be.  Years ago the pastor and friends at St. Bartholomew’s in New York visualized a pot of gold, there for the asking, if a 60-story office building could be built on the church site.  J. Sinclair Armstrong led the counter revolution, and St. Bart’s emerged unscathed.  All through our society vulture capitalists are scurrying around trying to see what cash they can skim from society—the larger good not on their agenda.  (7/25/07)

244. Battling Terrorism 
So far terrorism is winning the battle.  The administration’s various wars and unwieldy Homeland-Security policies are bankrupting us.  Further, the anti-risk mentality is blunting the core competitive strength of the U.S.—innovation, since it makes us think more about what not to do, then what new thing we are going to try.  It’s pretty clear that we will have think and act quite differently to win this game.  The U.S. will have to push aside its go-it-alone foreign policy and seek broad-based cooperation from governments all over the world.  Governments clearly would like to be on a more equal footing: we just have to begin to treat them like partners.  We will have to seize the moral high ground, by deed and by proclamation, to undermine the claims of our attackers.  And we will have to use a slew of new scientific tools and mathematical analytics, treating terrorism like a virus rather than a human enemy.  We think we are fighting wars rather than viruses.

Scientists, incidentally, occasionally show us they can devise tools that don’t cost a king’s ransom.  “While policy makers fret over the obstacles in developing biosensor technology, the best and cheapest biosensors are already distributed globally but generally ignored: They’re called animals.  The United States has spent millions of dollars to develop biosensors that would detect bioterrorism or other deadly agents.  But so far, the technology has not met expectations and questions have arisen as to whether additional spending is warranted for civilian applications” (“Animals: The World’s Best and Cheapest Biosensors,” Bulletin of the Atomic Scientists Online, 14 March 2007).

“In January 2007, the University of Illinois College of Veterinary Medicine held a ‘One Medicine’ colloquium to promote the link between human and animal health….  Such a concept was described and promoted in the landmark book Veterinary Medicine and Human Health in the 1980s by the late Calvin Schwabe….”  Now the College has announced plans to start a One Medicine Institute.

Previously in “Terrorism and Science” we have discussed discussing applications of “honeypot theory” as a way to attract and entrap terrorists.  (6/6/07)

Update: Containing Terrorism 
The Bush administration, pre Iraq, rejected containment as a way to counter terrorism.  “But now we know that the containment regime worked: Saddam Hussein’s Iraq was in position to threaten anyone….”  Comment by Ian Shapiro, political science professor at Yale, adapted from his book Containment: Rebuilding a Strategy against Global Terror.  “Terrorist groups might not always be feasible targets of containment, but enabling regimes certainly can be.”  “It is hard to imagine a terrorist group without territorial sanctuary continuing to present a serious threat to U.S. national security.”  (9/19/07)

Update: Engineers and Bomb Throwers

It turns out that a disproportionate percentage of engineers get their kicks by enlisting in the army of terrorists. In David Berreby’s “Engineering Terror,” New York Times Magazine, September 12, 2010, pp.22-24, we learn that  “in a paper published last year in The European Journal of Sociology, Gambetta and Hertog argue that” the engineering fraternity is over-represented in terrorist ranks.  In some studies, engineers make up 20% of terrorist groups, whereas a normal distribution would be more like 3.5%.   This insight is in itself not remarkable.  But it does point to the fact that fighting terrorism is more crime prevention and very unlike a military enterprise.  Demographic analysis is one of many tools that may lead to the apprehension of terrorists, but also that help us learn how to dampen the fires that lead to terrorism. Engineers, after all, are in many senses an alien class of people in the fundamentalist, even medieval, societies from whence they spring. Signally we have to learn that combating terrorism is not really a war, but much more akin to ridding oneself of a virus. (09-15-10)

243. French Fear and Loathing
“The French pop twice as many anti-cholesterol pills as the British do and three times as many antibiotics as the Germans” John Thornhill (“Les Miserables, the French are Filled with Fear and Frustration,” Financial Times, January 6-7, 2007, p. 7) found this in Francoscopie, a guide to everything about the French put out each year by Gerard Mermet, a French sociologist.  “In spite of the material well-being of the vast majority of its citizens, France is suffering from economic anaemia and social anomie….”  “Fear and and stress are omnipresent in daily life.”  Life expectancy is the highest in the European Union.  “Some 76 per cent think their country is in decline.  While a majority agree that globalization is good for the world, they tend to view it as bad for France.  Only 33 per cent of French people have a positive view of capitalism.”  But, a big but, the French have been dissatisfied for several years which you can discover by going back to Mermet’s compendiums for earlier years.  Probably he is only registering the French version of a general unease felt throughout the developed world where we find ourselves asset-rich and spiritually defunct.  (3/7/07)

242. Causing Profits
Since the Modern Age began, books have been written, plays performed, paintings besmeared, movies splashed out that are preachy and don’t make a thin dime.  The money might not matter, except for the fact that it usually means that the tract novel or bleeding-heart movie only reaches a few cult followers, never to affect the minds of the masses.  Of course, then there are the Michael Moores of the Left and Right who churn out cheap shot, distorted satires that do achieve unwarranted popularity on college campuses but lack enough depth to make a lasting mark on intelligent argument.  More interesting, we think, is “The Indie Movie Mogul,” Wired, February 2006, pp. 134-35.  Jeff Skoll, one-time president of E-Bay, has “established Oxford Skoll Center for Social Entrepreneurship, endowed three chairs at the University of Toronto,” etc.  More interestingly, he has set up Participant Productions that has backed a number of cause films that have excited the critics—and even occasionally have some merit.  They include Syriana; Good Night, and Good Luck (about Edward R. Murrow’s battle with Joe McCarthy which has both intellectual and artistic merit); North Country; An Inconvenient Truth, the Al Gore foray into global warming, and, next, Fast Food Nation. For more on Skoll, see “Moving Pictures,” Fast Forward, September 2006, pp.90-95.  Having put $600 million into his Foundation aimed at social entrepreneurship, he started Participant with $100 million.  All, except North Country, have made some money.  (2/21/07)

241. A Bulb Goes Off
Compact fluorescent bulbs promise to save consumers a parcel of money, take a big swipe out of energy consumption, and do more good for the environment that most of the complicated schemes now being hatched in ivory towers.  Read about the promise in “How Many Lightbulbs Does It Take to Change the World?” Fast Company, September 2006, pp. 74-83. “Compact fluorescents emit the same light as classic incandescents but use 75% or 80% less electricity.”  “Compact fluorescents, even in heavy use, last 5, 7, 10 years.”  “In the next twelve months … Wal-Mart wants to sell every one of its regular customers—100 million in all—one swirl bulb.”  (1/17/07)

240. Second Life
Second Life, a fast-growth, virtual playground for the imaginative, hit the million member mark in October 2006, having struck a responsive cord amongst the adventurous who want to play around in idyllic pastures.  You can read a bit more about it in our “Good Society.”  This is the creation of Phillip Rosedale, who came out of Real Networks.  As happens with technies, the site is over-engineered and even the pricing gimmicks are too complicated.  Complication is a substitute for simplicity and originality.  Nonetheless, this Brave New World has taken hold of the vox populi.  (1/10/07)

239. Competitive Disadvantage
In “Risk Pool,” New Yorker, August 8, 2006, Malcolm Gladwell discovers that the dividing line between the Asian Tigers (i.e, the high growth economies and companies of Asia) and the American and European sluggards is dependency costs.  In other words, Westerners, and particularly Americans, are laying out huge expenditures on a company by company basis for pensioners both for health and retirement.  Too high a dependency burden puts an unsupportable overhead cost burden on all companies, particularly those with overcapacity—such as the car companies:

The difference is that in most countries the government, or large groups of companies, provides pensions and health insurance.  The United States, by contrast, has over the past fifty years followed the lead of Charlie Wilson and the bosses of Toledo and made individual companies responsible for the care of their retirees.  It is this fact, as much as any other, that explains the current crisis.  In 1950, Charlie Wilson was wrong, and Walter Reuther was right.

Charlie Wilson was Engine Charlie Wilson, of course, the famed leader of GM who railed against pooled pension schemes, preferring to things on a company by company basis.  Walter Reuther was the auto union leader who understood that both workers, companies, and the countries would enjoy more stable growth if the burden was spread over a range of companies.

“Demographers estimate that declines in dependency ratios are responsible for about a third of the East Asian economic miracle of the postwar era; this is a part of the world that, in the course of twenty-five years, saw its dependency ratio decline thirty-five per cent.  Dependency ratios may also help answer the much-debated question of whether India or China has a brighter economic future.  Right now, China is in the midst of what Joseph Chamie, the former director of the United Nations’ population division, calls the ‘sweet spot.’  In the nineteen-sixties, China brought down its birth rate dramatically; those children are now grown up and in the workforce, and there is no similarly sized class of dependents behind them.  India, on the other hand, reduced its birth rate much more slowly and has yet to hit the sweet spot.  Its best years are ahead.”  (11/1/06)

238. Run Robots, Run
We have been gathering material on robots, so much so that our cup runneth over, and we lack perspective on this whole topic.  The uses of robots are multiplying—every day.  Japan seems to have the lead, but there are plenty of robots all over the globe.  The New York Times captured some of this ferment in “Brainy Robots Start Stepping into Daily Life,” July 18, 2006, pp A1 and C4.  Of course, this article is rather limited, focusing really on Silicon Valley, where John Markoff, the key Times tech writer, is located.  “Today some scientists are beginning to use the term cognitive computing, to distinguish their research from an earlier generation of artificial intelligence work.  What sets the new researchers apart is a wealth of new biological data on how the human brain functions.”  Tellme in Mountain View has voice recognition services for both customer service and telephone directory applications: at first, it could only answer 37 percent of the inquiries, but now that has bounced up to 74 percent.  In mobile robotics, “the field has been dominated by Japan and South Korea, but the Stanford researchers have sketched out a three-year plan to bring the United States to parity.”  (9/6/06)

Update: Artificial Intelligence
We have long said that WGBH is Boston’s central cultural institution.  Most of you will plough ground at MIT to get your robot and artificial intelligence education.  But you can also refer to the WGBH Network, where you can find an Artifical Intelligence Lecture series that will set you to thinking.  Here you will find experiments using robots in music, vehicle guidance, etc.  The techies at WGBH have made these files unduly complicated to open, but that pain occurs with geeks everywhere.  (3/14/07)

Update: Tiny Robots
A Japanese toy company is set to come out with the world’s smallest humanoid robot on October 25,  2007.  Coming from Tomy, its name is i-SOBOT.  “i-SOBOT stands just 16.5 centimeters tall, and weighs only around 350 grams.  While the robot fits in the palm of your hand, it remains a fully outfitted bipedal machine, with 17 moving joints.  Used throughout the body are tiny, custom servomotors developed by Tomy.”  “In 2008 Tomy intends to extend sales to Europe as well.  To reach its global sales target of 300,000 units, the company is localizing i-SOBOT’s software in English and Chinese in addition to Japanese.”

As we said in “Why Experts Are Wrong,” U.S. interest in robots is mounting, even though Japan has long held the lead.  It’s not at all clear that the center for robotic thinking will be Silicon Valley.  Some think the New England Corridor has the skill sets and mindset to seize the leadership.  (11/28/07)

Update: Robots Recycled
Robots have so come of age that now they are even being recycled.  This ‘used’ market has permitted smaller companies that cannot afford the price tag of newly minted robots to put some robot workers on their shop floors.  Fortune Small Business, October 1, 2007, p. 58, brings this to light in  “Think You Can’t Afford Automation:  Think Again.”

“Two of the best workers at Blue Chip, a manufacturing shop in Columbus, don't take lunch breaks.  These model employees draw no salary, work unlimited shifts, and weld at lightning speed.  Their performance isn’t just superhuman—it isn’t human at all.  ‘My robots are wonderful,’ says Steve Tatman, vice president of engineering at Blue Chip.

‘Since adding them to the team, we’ve become more competitive and more efficient.’  Blue Chip grosses about $5 million a year machining spare parts for the U.S. military.  ‘I always thought robots were out of our league, pricewise,’ says Tatman, 47, who owns and operates the company in partnership with his wife, Tammy, Blue Chip s president.  ‘They were a mystery to me.’  But when Blue Chip landed a Pentagon contract to manufacture thousands of drift pins (L-shaped tools the military needed to change tank treads), he decided it was finally time to explore automation.  ‘It takes a human seven minutes to weld a drift pin,’ he says.  ‘It takes a machine 45 seconds.’”

“171,000 robots toil in North American factories, and sales jumped 39% in the first half of 2007, according to the Robotics Industries Association, a trade group.  As robot prices come down, more small manufacturers are investing in automation.  While robot orders from automotive companies dropped 30% in 2006, nonautomotive orders, many of them placed by small businesses, composed 44% of all purchases, up from 30% in 2005, says the RIA.”

“Not surprisingly, used-robot vendors cluster in Rustbelt states such as Ohio and Michigan.  ‘Factories close, they’re looking to sell their equipment, and they come to us,’ says Wanner, head of RobotWorx.  One of his competitors, Rebotics, has even managed to go global.  ‘We’ve found customers in Mexico, Canada, India,’ says owner Bob Lieblang.  Rebotics robots operate in industries such as parts assembly, packaging, and food processing, where they perform jobs ranging from welding and painting to materials handling.”  (1/2/08)

Update: Robots Galore
“In October 2008 a Japanese company will become the first in the world to begin mass-producing a robot that assists humans in moving their limbs.  A research team led by University of Tsukuba Professor Sankai Yoshiyuki has developed the device, which is called Robot Suit HAL (Hybrid Assistive Limb) TM.  Sankai is the CEO of Cyberdyne Inc., the company that plans to begin making this robot suit available for rental through sales outlets.”

“When you want to move your body, your brain sends out an electric signal that is received by your muscles, which then contract, thus producing motion.  This electric signal travels to the muscles via the body's nerves, generating a slight voltage of electricity on the surface of the skin.  This is known as a bioelectric signal, and Robot Suit HAL detects them using the sensors placed around the wearer's body.  Depending on the voltage running the surface of the skin, the computer inside Robot Suit HAL analyzes the signal and sets the appropriate motors in motion.”  This signal process gets around the difficulty posed by users who cannot move their muscles, but who can send out a mental impulse to them for detection.  See Trends in Japan.  (9/10/08)

237. Charity Vending Machines
“Appearing across Japan recently is something called the ‘charity vending machine,’ which allows users to donate their change to such good causes as environmental conservation and child welfare at the push of a button.  These machines have been well received by consumers, who enjoy being able to contribute to a cause that interests them when they buy a canned or bottled drink. 

Drinks maker Ito En has linked up with the Japanese Organization for International Cooperation in Family Planning (JOICFP) and last year began setting up vending machines that dispense drinks with White Ribbon stickers attached.  The machines are presently in use in eight locations, including in front of the building in Tokyo's Shinjuku district that houses JOICFP. 

When a person buys a drink from one of these vending machines, a portion of the profits goes to the White Ribbon Campaign, which aims to protect the lives and health of pregnant women in developing countries.  The prices of canned and bottled drinks are the same as those of a normal machine, but between ¥2 and ¥5 (a few US cents) per bottle is donated to JOICFP.  In fiscal 2005 (April 2005 to March 2006), some ¥220,000 ($1,929 at ¥114 to the dollar) was collected and given to a project for maternal and infant health care in Afghanistan's Nangarhar Province.

A charity vending machine devised by the NPO Miyagi Heartful Vendor was installed in a student cafeteria at Tohoku Fukushi University in Sendai City this May.  There are two buttons above the coin slot marked ¥10 (9¢) and ¥100 (89¢), and a customer can donate one of these amounts from his or her change after purchasing a drink just by pressing the appropriate button. The buttons can be pressed as many times as the customer likes, with each press increasing the donation.  It is also possible to donate money without purchasing a drink.  Plans are afoot to install 200 of these machines in Miyagi Prefecture by March 2007 and to distribute the funds collected to social welfare organizations and disaster relief groups. 

Through the use of charity vending machines, various Coca-Cola Bottling companies have been working closely with local communities to undertake such efforts as contributing to environmental protection measures (in Shari Town, Hokkaido), returning storks to the wild (in Toyooka City, Hyogo Prefecture), and preserving crabs (in Kasaoka City, Okayama Prefecture).  Likewise, Pokka Corp. in February 2005 began donating a portion of the profits from sales of its ‘carton can’ drinks to the Forest Fund, which plays a role in training people in forestry.”  (From Trends in Japan.)  (8/9/06)

236. B-Schools Put Luxury Brands on Academic Menu
As our society and our markets split in two—with low end commodity products and high end boutique extravaganzas—the business schools are catching on and putting a lot more “luxury” courses in their curriculums.  See The Wall Street Journal, June 13, 2006, p.B5. Harvard even has a Luxury Goods and Design Business Club.  European schools such as the University of Monaco, SDA Bocconi in Italy, and IESE Business School in Spain are also in the game.  (8/2/06)

235. Restaurants with Laboratory Food
“The genius at the heart of the lab is Grant Achatz (rhymes with rackets).  A veteran of famous kitchens, the 31-year-old chef opened Alinea on the north side of Chicago a year ago.”  “The kitchen—spotless, sparkling stainless steel—looks like a chemistry lab.  Dominating an entire counter, with a smooth steel top and an industrial frame, sits the antigriddle.  Built by lab supplier PolyScience, it can chill food to minus-30 degrees Farhrenheit in an instant.  Another station features an infuser, more often found in head shops and Amsterdam coffeehouses, which pumps mace-scented air into cotton pillows that cushion a duck-and-foie-gras dish.  And in the spice rack alongside the cinnamon and paprika are carrageenan and sodium alginate-chemicals used to thicken and stabilize foods.”  “Achataz isn’t the only chef melding science and haute cuisine—a mashup sometimes called molecular gastronomy.  Heston Blumenthal does it at the Fat Duck outside London, and the godfather of the movement is Ferran Adria, at El Bulli near Barcelona.  It’s a small group that faces one big criticism: The food is just too strange.”  See “My Compliments to the Lab,” Wired, May 2006, pp.112-118.  (7/12/06)

234. Online Communities
Online communities are becoming big business.  Rupert Murdoch, for instance, has recognized that traditional media revenues have crested, and that he must expand in the virtual world.  He has bought MySpace.com and is trying to turn it into a high-revenue source.  Here, kids and adults post their lives on the net, and try to exchange with others looking for company and recognition in virtual space.  This has led to some privacy problems and some exploitation of youngsters by the unscrupulous.  Better policed is Mark Zuckerberg’s Facebook, invented while he was a student at Harvard.  It tends to restrict access to a limited body of associates, say your classmates at a college.  Like Bill Gates, Zuckerberg eventually gave up Harvard for the lure of computer moguldom.  His enterprise is now headquartered in Palo Alto, and he is now backed with lots of venture money from VC that dream of making a killing someday.  See “Me Media,” New Yorker, May 15, 2006, pp.50-59.  Yet to be explored, we think, is how to nurture and construct better knowledge communities where sophisticated dialogue and collaboration takes place, free perhaps of the rambling and platitudes endemic in blogdom.  There’s yet much to be discovered at making global collaboration work.  (6/20/06)

233. University Arbitrage
“[D]ebt-raising is becoming more common, although the average bond issue is smaller” than $250 million worth of bonds recently raised by Cornell, or the hundred of millions brought in by Harvard and the University of Texas (“An Education in Finance,” The Economist, May 20, 2006, p. 79).  “Lehman Brothers reckons that the overall market for higher-education debt has tripled since 2000, to $33 billion….”  With a need to extend and renovate facilitates in a market where student applicants may have a chance to get more choosey, it pays to leverage assets with debt.  “Both public and not-for-profit universities often issue tax-exempt debt….  They can then invest the money they raise in the higher-yielding taxable market but, because of their non-profit status, avoid taxes.”  In effect, a university can borrow cheaply and earn a spread.  “Most universities borrow at variable rates … and then hedge their interest-rate risk through swaps.”  (6/7/06)

232. Terrorism and Science
A step at a time, we are fashioning analytical tools that will help us identify and control terrorist networks.  We have previously discussed “Syndromic Surveillance Networks” which show promise in dealing with everything from pollution to terrorists.  As well, “honeypot” theory, out of Israel, devised to deal with computer viruses, may be deployed against a variety of other threats.  We have, in fact, a greater need to look at Israeli thinking, particularly as relates to skyjacking, since that nation has been dealing with hit and run tactics since its founding. 

Now quantitative analysis (“Science Journal,” Wall Street Journal, Februrary 17, 2006, p. B1) may be able to look into “terrorism cycles.”  “One promising technique, called spectral analysis, is typically applied to cyclical events such as sunspots.  A new application of it is … [for] terrorism, which, data show, waxes and wanes in regular, wavelike cycles.”  Analysis also reveals that efforts to shore up defenses against one kind of threat merely deflects terrorists into other activities.  “The only way of thwart this substitution effect is to disrupt terrorists’ funding and recruitment.  Professors Todd Sandler and Walter Enders have looked at some of these patterns in The Political Economy of Terrorism.  (5/31/06)

231. The Imperfect Art of Economic Development
Despite all the brainpower and money that has been put to the task of lifting developing nations out of poverty, we still don’t have a very good idea how to go about it.  In general the problem is that theorists from very developed nations want to impose their complex ideas on simple societies which need very basic improvements, such as Norman Borlaug’s high-yield, low-pesticide dwarf wheat, the Wendroff Cart, or a plastic bin to strain arsenic out of drinking water

Thoughtful people everywhere have grown cynical of government and NGO attempts to micromanage development.  Lord Peter Bauer thought the main duty of governments was to guarantee property rights, and to get out of the way of free markets and the free exchange of ideas.  The renowned Hernando de Soto of Peru thinks guaranteed property rights linked to microfinance can lift vast numbers of the poor out of poverty.  In effect, they are both saying that the role of government in development is to create a stable political climate and a reasonable legal framework. 

Sir Hans Singer adds a refinement that merits attention.  Free markets within countries tend to work rather well, if the central government enforces their operation.  But Singer, publishing in 1948 during his days at the UN, concluded “that the benefits of trade were distributed unequally between the countries that imported agricultural commodities and those that exported them, to the disadvantage of the exporters.”  See The Economist, March 13, 2006, p. 79.  This came to be known as the Prebisch-Singer thesis.  It’s foolish to think that the international trade mechanism works naturally in a win-win fashion for the nations of the world, and it takes a bit of ingenuity to reckon with this.  Singer advocated soft loans to poor countries, but that seems a bit wooly and impractical.  He wrote copiously about economic development, his writing reflecting his training under both Schumpter and Keynes.  (5/24/06)

Update: More on Microfinance
Everybody from Bono to Bill Gates is taking a whack at world poverty, a field open to all comers since nobody has a good model for getting at the problem.  Pierre Omidyar, founder of eDay and co-founder of Omidyar Network, has gotten into the act by taking up the cudgels for microfinance.  He is funneling $100 million to microfinance institutions via The Omidyar-Tufts Microfinance Fund.  In fact, microfinance is very much the enthusiasm of this decade, which one can read about in The Economics of Microfinance and in the publication Microfinance Matters.  All this was set in motion by the Peruvian Herman de Soto. 

A good review of progress in this sector is found in “The Hidden Wealth of the Poor,” The Economist, November 5, 2005.  “Local banking giants that used to ignore the poor, such as Ecuador’s Bank Pichincha and India’s ICICI, are now entering the market….  Some of the world’s biggest and wealthiest banks, including Citigroup, Deutsche Bank, Commerzbank, HSBC, ING and ABN Amro, are dipping their toes into the water.”  Everybody from Islamic fundamentalists to Maoists to Afghan drug traders have plundered and murdered to prevent the spread of microfinance which loosens the hold they have over the poor.  “The core of the industry today consists of some three dozen multinational networks of microfinance providers....”  “The biggest networks include Opportunity International, FINCA, ACCION, Pro-Credit, Women’s World Banking  and arguably Grameen….”  With the entry of the big banks, microfinance is becoming increasingly mainstream; now it will have to include its range of financial service products for the poor, venturing, for instance, into insurance.  (6/14/06)

230. Bursting the Bubble
Ray DeVoe, probably the most perceptive and most literate devotee of the financial markets, has watched, partially in glee we think, as the various bubbles in the U.S. and in the world have gone poof and disappeared forever.  The worst bubble of all, of course, is the silly inflation in housing prices, propped up by easy money and giveaway interest rates.  It has held on for a while. But no more.  The default rate is up drastically, and a further tumble in prices is in the offing.  “RealtyTrac, the leading online marketplace for foreclosure properties, today released its 2006 Q1 U.S. Foreclosure Market Report, which showed that 323,102 properties nationwide entered some stage of foreclosure in the first quarter of 2006, a 38 percent increase from the previous quarter and a 72 percent year-over-year increase from the first quarter of 2005.”  Squire Firehock, who now has time to watch the Decline of the West, just forwarded this little tidbit to us.  (5/17/06) 

229. Upmarket Coffee
Not only manufacturers, but farmers as well, are finding that they have to go upmarket into niches in order to survive.  This is being seen in the world coffee business where prices richochet widely, now fortunately double the rock bottom levels of August 2002.  See The Economist, April 1, 2006, p. 33.  Some are decoupling from world prices, linking to Fairtrade in London which seeks to get farmers a reasonable price.  Others get certified as organic or “bird-friendly” to get a premium.  “Some niches can be large.  Only 6% of world output is of top quality, but in Costa Rica and Guatemala the figure rises to 60%.”  “Mexico lags behind its neighbors in extracting higher prices.  But 95% of the coffee in Mexico is arabica—the type of bean demanded by connoisseurs—rather than lower-grade robusta.  Almost all of it is grown at altitude, which also improves quality.  So Mexico, too, has the potential to compete on quality rather than price.”  Interestingly, Mexico also has high quality vanilla bean production, but here too it has had a hard time extracting a quality premium, and so its “exports of coffee are less than half of what they were six years ago.”  Hopefully better governance and efforts by trade associations.  Fernando Celis has been a leader in this effort and has a written about “New Forms of Association in Mexican Coffee Cultivation.”  Our sister site, www.spicelines.com, recently talks of a tour of the Veracruz region, which grows the finest coffee, vanilla beans, and other agricultural delicacies, but poor marketing nets the growers subpar prices.  (5/3/06)

228. Farmers' Markets
Farmers’ markets have grown like topsy—all to good effect.  Farmers, cutting out heavy-handed middlemen, get a better dollar for their product, offer fresher produce, often without chemicals, and, to boot, bring more variety to urban households and to gourmet restaurants.  “The Ripe Stuff,” by Mary-Powell Thomas in Audubon Magazine, March-April 2006, pp. 82-87 provides a very good review of the subject, although her representative selection of markets is a bit flawed, citing at least two markets around the country where the prices are too high and the fare too limited.  Accounting now for 2 percent of the fresh produce sold in the U.S., the number of markets has risen from 1,755 in 1994 to 3,706 in 2004.  They are the hope for the preservation of the family farm and the conservation of variety in species.  Interestingly, Ms. Thomas lives in Brooklyn, where one will find many of the hardcore advocates for an alternate society.  The markets are a good idea for another reason.  With the growing urbanization of America, the conservation movement has been losing its footing.  It is Balkanized and often pursues the petty at the expense of the important.  Farmers’ Markets provide the means for conservationists to connect with America.  If you can hit people where they eat, you stand a chance of winning against mindless, predatory development.  (4/26/06)

227. Zoning and Regulations Equal High Costs
We are just beginning to understand friction costs, the roadblocks to easy commerce such as government regulations, lawyer redtape, and so on, that make products and services more costly than they should be.  We have still not devised good official ways of lowering them. Edward L.Glaeser, a Harvard economist, has long wondered why housing costs so much more than it should, dramatically so in some urban areas.  To over-simplify, he finds that zoning bakes in high costs.  Jon Gertner’s “Home Economics,” New York Times Magazine, March 5, 2006, pp. 94-99 gives a quick tutorial on Glaeser’s thinking, which Chip Case, an economist in this sector at Wellesley, buys into, as we learned in our recent discussions with him. 

The trouble with friction costs is that you’re damned if you do, and damned if you don’t.  A lack of zoning and other restraints have led to very small lots and substandard houses in much of the West and South, which results when you give builders too much freedom.  With the airlines and with the power and telephone companies, we are strolling towards uncompetitive marketplaces with one or two suppliers at best where inferior quality and pretty high prices are the order of the day, the much vaunted de-regulation netting us very little.  The question is what kind of regulation does one need in the marketplace—restraint that does not strangle but still provides appropriate guidance.  De-regulation in itself is not a cure for inefficient markets.  (4/19/06)

226. Prematurely Retired
Sooner or later, we will have to face up the fact that we, along with the other developed nations, are just getting plain old, and that our attitudes towards and treatment of oldsters have got to change—completely.  The sooner the better. 

As we said in “Breakdowns Don’t Work,” we more or less have to give up the concept of retirement, as it now exists.  First, the negative.  We can no longer afford the private and public pension systems as now constructed; instead, we will have to raise the retirement age, with a quick leap to 70, and with the further idea that even then we mean partial retirement, enabling people who are able to keep working.  Along with this, we have to turn the healthcare system on end.  Oldsters account for an unbelievable percentage of our out-of-control healthcare costs which are draining our purses dry and making our businesses globally uncompetitive.  That means dramatically improved preventive, public health care from childhood—something that does not really exist today.  In fact, America’s infant mortality rates make us look like a Third-World country.  And much of the senior chronic care has to be done outside hospitals with much lower paid healthcare coaches. 

Second, the positive.  It so happens we need these oldsters, many of whom have a better work ethic and a lot of practical education lacking in their children, and their children’s children.  So the good news is that we need them as much as they need to be employed. 

The Economist, February 18, 2006, pp. 65-67 takes some of this on in “Turning Boomers into Boomerangs.”  This deals with the aging of the workforce, acknowledging that there will not be enough knowledge workers to keep advanced economies humming. 

“Near the top of the AARP’s latest list (of good senior employers) comes Deere & Company, a no-nonsense industrial-equipment manufacturer based in Moline, Illinois.”  The Economist has a tough time talking simply: it’s a farm tractor maker that’s added on a bunch of other stuff.  “About 35% of Deere’s 46,000 employees are over 50 and a number of them are in their 70s.” Deere has devised flexible work rules and factory ergonomics that help seniors.  Toyota, BMW, and IBM also are working the senior route. 

But the companies that focus on developing senior work forces are few and far between.  Most managers are thinking too short term to be dealing with this looming problem.  Higher payscales for older, long-term employees often is a disincentive for cost-plagued companies.  And many government policies unintentionally discourage the employment of a grey force.  That said, a massive shift to elder employment will have to come because we need their skills and we can’t afford to pay them benefits to sit on their posteriors. 

This is, incidentally, a massive opportunity for higher education, which needs to be totally re-invented in any event.  Seniors, if you like, will have to be retreaded, and this must get done as they near their first semiretirement so that they can seamlessly move into their next jobs, which must be brain- rather than brawn-centered.  Donald R. Read writes about the “Seniors Market” in Community College Journal, April/May 2004, pp. 44-50.  He sees the senior re-education market as a major opportunity for higher education: 

Right now, there are about 35 million adults over age 65 in the United States.  In 2030, that number will have more than doubled, to about 71 million.  …  An example of the opportunity represented by this population is an experiment called Next Step … under the joint sponsorship of the Communication Workers of America, the International Brotherhood of Electrical Workers, and the Verizon Corporation.  …  The program has already put over 4,300 employees through a program leading to the A.A.S. degree in Telecommunications.  …  When the employees/students complete the five-year program, they have new degrees, new jobs, and a new view of the future. 

Read notes that academia itself also has to face the music.  “In 2000, 83 percent of academic institutions reported that 25 percent or more of their faculty were over the age of 50.” Of all the industries covered in a Mercer study, “universities had the oldest employee population.”  Rapid-fire retirement could lead to a crisis notes Betsy Brown, at the University of North Carolina, “where more than half of the staff is over 55.”  (4/19/06)

225. Chess Nuts 
We are finding passionate chessies in unlikely locations, and we don’t quite know what to make of it.  Is it an escape from the wasteland where they find themselves?  Is it connected to some secret and isolated pockets of intellectual activity? 

The kids are champs at Border Star Elementary out in Kansas City, Missouri.  In fact, chess has taken hold with numerous kids in the Kansas City area.  “Lombard, who coaches several other chess teams in the Kansas City School District, said the three-year old chess program at Border Star has one of the strongest participation rates.” 

Professional football stars, as well as athletes in other sports, have taken up chess to pass the time and to heighten their attention to strategy.  In “Pro Football: Dazzling Moves on Field and Chessboard,” New York Times, January 28, 2006, we learn that a surprising number of football greats are chess players as well: 

Jim Brown and Barry Sanders are in the Pro Football Hall of Fame.  The Jets’ Curtis Martin will almost certainly be one day.  As Shaun Alexander prepares to lead the Seattle Seahawks into the Super Bowl, he shares more with these players than just being one of football’s best running backs. 

Like the others, he is also an avid chess player. 

“I just love what chess is all about,” Alexander said.  “To me, it is just a great strategy game.” 

Miami’s Dade College has joined the chess big leagues, knocking Ivy League teams on their fannies.  The players came from “chess-mad Cuba.”  See the Wall Street Journal, March 4-5, 1006, pp. A1 and A6.  The Cubans still revere their 1920s grandmaster Jose Raul Capablanca; Che Guevara played chess to relax.  “Fidel Castro made learning the game obligatory in Cuban schools.  He established Soviet-style boarding schools where gifted young players received four hours of daily training from chess masters.”  (4/5/06)

224. How Nations Design 
“One of the keenest observers of this renaissance has been Lee Kun Pyo, director of the Human-Centered Interaction Design Laboratory at the Korea Advanced Institute of Science & Technology.  BusinessWeek Asia Editor David Rocks and Seoul Bureau Chief Moon Ihlwan recently sat down with Lee in a Seoul Chinese restaurant to share plates of roasted eggplant, grilled shrimp, and fried tofu while discussing the changes sweeping Korean design” (“The Flavor of Korean Design,” Business Week, January 24, 2006). 

But Koreans traditionally don’t articulate what they’re doing beforehand.  They’re very contextual.  Of course they do customer research and product planning and user-centered design and so on.  But they quickly arrive at solutions, then look at the solution to find any further problems.  Some might say that’s unsystematic, but it’s really very dynamic.  And it works well for products with a short lifecycle, like mobile phones or MP3 players. 

It’s not only design—there’s a pattern of differences among the cultures.  In food, the Japanese keep things very simple, Korean food is very hot, Chinese is very greasy.  In colors, Japan is very monochrome.  Korea is a little bit red.  And China is red and gold.

In Japanese traditional music there’s almost no sound.  Korea’s is a little bit noisier, and Chinese opera is very loud.  The same goes for the communication mode.  In Japan, when people finish speaking there’s a little pause, then the other person replies.  In Korea, people are a little faster, and in China they all overlap.  All those things are visible in aesthetics.  Japanese products don’t violate the horizontal and vertical, but Korean design is a little bit more dynamic.  And in China, it’s very busy. 

Korea has 230 design schools—more than America.  But 80% of those schools still require a drawing examination for admission.  Of course there are some design problems that require drawing.  But interface design solutions can’t be drawn. It doesn't make any sense. 

And this explains to us why Japanese design leads to too much functionality in a product and a dashboard (i.e., switches) that is much too complicated to operate, designed for a nation of near-sighted people.  On a more serious note, this whole discussion probably leads us to think rather carefully about where to have a product designed.  

It’s worth a visit to his lab’s website where one can get an idea of the scope of his ideas and publications.  It’s a little tricky, we find, since one seems to get Korean pages when keyed to English, and English pages when keyed to Korean.  That’s just a humorous footnote.  There are serious efforts here, too, in the area of robot design, a field in which there is rumblings the world over.  (3/29/06)

223. Will Oil Shale Pan Out? 
“The United States contains massive amounts of oil in mineral deposits, known as oil shale, in the border area of Colorado, Utah, and Wyoming.  The recoverable energy from these deposits might be more than the equivalent of 800 billion barrels of crude oil—more than triple the known reserves of Saudi Arabia.”  See “In Search of Energy Security,” Rand Review, Fall 2005, pp.18-23.  But, of course, the million-dollar question is whether we can mine them economically. 

With in-situ conversion, “electric heating elements are placed in bore holes, slowly heating the oil deposit.  The released liquids are gathered in wells specifically designed for that purpose.”  “While larger-scale tests are needed, Shell anticipates that this method may be competitive with crude oil priced below even $30 a barrel.”  Right now, oil has to be pegged at $70 a barrel, for shale extraction to be viable.  If shale extraction gets over price, technological, environmental, and legal hurdles, it could also mildly depress the price per barrel of traditional oil. 

Short term, says Rand, our real option is to increase efficiency in how we use oil.  Very long term, Rand hopes, we may generate hydrogen fuels.  (3/22/06)

222. NanoScience
We keep meaning to develop more sources and commentary around nanoscience and not getting it done.  Everybody has a piece of the action, so it’s hard to put together a comprehensive piece about this field.  Even Richard Feynmann, everybody’s favorite Nobel Prize winner, dipped his toes in nano-waters.  So we will just get started and keep adding to this article.  Of course, this item should be featured in a area called Little Ideas, instead of Big Ideas, but we will live with that contradiction. 

As nice a place to get started as any is Sandia Laboratories.  It’s a lovely little site, with a modesty to it that suggests that someone out there has some style.  You can find a number of simple videos that explain the processes of nano-science.  There’s not much substance there yet.  It just serves as a pleasant introduction—a light cocktail—to get you started.  (3/22/06)

221. Fighting Computer Viruses with Honey Pots
Eran Shir and colleagues at Tel Aviv University think they can put a stop to computer viruses by hitting them before they get started.  In general they would propose to embed lures—a honey pot—in the network that would attract newly formed viruses.  Then data about the viruses could quickly be passed around to computers, and defenses erected.  An article detailing their theory called “Distributive immunization of networks against viruses using the ‘honey-pot’ architecture” appeared in the December 1, 2005 Nature Physics.  Some details about this work and Shir’s general activities appear on his personal homepage.

Something analogous to this, we think, will eventually become the process nations use to entrap terrorists.  That is, processes will be devised which snare activists, submit them to analysis, and broadcast safety protocols to likely target nations.  Present tactics that try to discover and destroy terrorist cells are both wasteful and rather ineffective.  (3/15/06)

220. La Patria Nostra
It’s all too easy to ignore Italy and neglect the disproportionate effect it has across the globe.  The butt of jokes, Westerners everywhere mock it, and it mocks itself.  So much of what goes on is hidden from view.  It is famous for an underground economy, a robust, secret trade which is taken to be more sizable than the larger economy, and certainly much more dynamic.  Italians made their living in the post-war world away from the prying eyes of the taxman and the prying hands of corrupt officials-in the not so hidden, invisible economy. 

All sorts of things make the country different, and far different than we think it is.  We hear than only 4% of the population can be classified as immigrant, rather apart from Germany or from the France that has been recently racked by riots of its segregated North Africans.  Greece, just across the sea, is actually being invigorated by the 10% who come from abroad.  Catholicism is dominant, but who would have thought that Jehovah Witnesses (an American import from Brooklyn, no less) would be the second largest Christian denomination? 

A good starting point on some of its dilemmas is The Economist, November 24, 2005.  It makes for dreary reading, and you will be fairly convinced that Italy is on the way to the junkheap, until your commonsense asserts itself.  Of course, journalists specialize in problems, not solutions.  To leaven the spirits, one should probably visit The Hague between March 11 and June 25, 2006 when the Royal Picture Gallery Mauritshuis will be “Dreaming of Italy.”  Italy is what you make of it.  Analysts tear it apart, and creatives put it back together. 

Colin Goedecke visited with his wife’s family in Rome for Christmas 2005.  His “A Tale of One City in Four Courses” will give you a sampling of its delights.

219. The Spread of Sudoku
Sudoku has been spreading through America like wildfire, and yet most Americans have never heard of it.  “The movement continues to grow, and there is a mini industry springing up to sell sudoku in a variety of new forms.  A number of software makers are introducing versions for cellphones and personal digital assistants” (Wall Street Journal, February 9, 2006, pp.D1 and D5).  Electronic games are on the way, and board-game maker Briarpatch is coming out with a version.  “Web sites such as soduku.com are offering premium services where players order an unlimited number of puzzles to play online for $15.” 

“After first catching on in Japan in the 1980s (Its name is a Japanese word commonly translated as ‘single numbers only’), sudoku quickly hopscotched across the globe.  It was introduced in England a little more than a year ago.  The New York Post … brought the puzzle across the Atlantic last spring.  More than a hundred U.S. papers now carry the puzzle and suduko puzzle books are popping up on best-seller lists.” 

“Still, the puzzle is already facing competition from a cohort of new Japanese puzzles.like kakuro….”  Culturally it would be interesting to understand what obsessive aspect of Japanese character makes it the fountainhead for complex gaming—Sony Playstation, sodoku,  Nintendo, bishojo,  etc.  “The pachinko business in Japan is five times larger than the gambling industry in the entire United States and 10 times larger than Las Vegas gambling revenue.  There are some 17,000 pachinko parlors in Japan and 5 million pachinko or slot machines operating.”  All the games, which range from gambling to pornography to child’s play, would appear to be a permitted outlet in a society where the citizenry voluntarily exerts self repression over itself. 

A quirky little marketing firm in Connecticut, which is good at spotting minor trends, has written more than you want to know about sudoku, and we recommend its musings to your attention. See Ray Daly at Squidoo.  (3/8/06)

218. Watanabe Sees the Light
Since the end of the Cold War, we have seen a burst of nationalism in country after country.  Our own thesis is that each country, in its own way, is reacting to overwhelming global forces. Such emotions have long been pent up and have now been released with the end of Big Power dominance.  Nobody quite knows how to deal with these global storms, so suspicious, virtually paranoid reaction mixed with false bravado becomes the kneejerk response of the day.  Islamic terrorism is just one of these global forces: it is stateless and is a virus that threatens the modern state, as jihadists try to pull us back into medieval times, in that age that preceded the rise of nations as we know them now. 

Remarkably, Tsuneo Watanabe, a conservative and Japan’s most powerful media baron, is now sticking his finger right in the eye of Japanese jingoism.  See “Shadow Shogun Steps Into Light, to Change Japan” (New York Times, February 11, 2006): 

Mr. Watanabe, now nearly 80 years old, has stepped into the light.  He has recently granted long, soul-baring interviews in which he has questioned the rising nationalism he has cultivated so assiduously in the pages of his newspaper, the conservative Yomiuri—the world's largest, with a circulation of 14 million.  Now, he talks about the need to acknowledge Japan's violent wartime history and reflects on his wife’s illness and his own, as well as the joys of playing with his new hamsters. 

His first move was to publish an editorial last June criticizing Mr. Koizumi’s visits to the Yasukuni Shrine, the Shinto memorial where 14 Class A war criminals, including the wartime prime minister, Hideki Tojo, are deified.  It was an about-face for The Yomiuri, which had tended to react viscerally against foreign criticism of the Yasukuni visits. 

Mr. Koizumi worships at a shrine that glorifies militarism, said Mr. Watanabe, who equates Tojo with Hitler.  He added, “This person Koizumi doesn't know history or philosophy, doesn’t study, doesn’t have any culture.  That’s why he says stupid things, like, ‘What's wrong about worshiping at Yasukuni?’  Or, ‘China and Korea are the only countries that criticize Yasukuni.’  This stems from his ignorance.”  Like many of postwar Japan’s leaders with wartime experience, Mr. Watanabe is suspicious of the emotional appeals to nationalism used increasingly by those who never saw war.  (3/1/06)

217. Theories about the Leisure Class
The economists are telling us we are becoming more laid back every day.  Economists Mark Aguiar and Erik Hurst tell us that over the last 40 years our leisure activity has increased 4-8 hours a week, depending on how you measure it (The Economist, “The Land of Leisure,” February 4, 2006, pp.28-29).  Several academics agree with their conclusions.  Also see Chicago Graduate School of Business report.)  Ostensibly these findings are based on time-use diaries where detailed journal entries show how a population spends its time.  Such a conclusion defies the evidence of our own senses where we find people working harder—outside of the workplace—and multitasking as never before.  This study, by the way, even takes into account some of the work outside the workplace—chores like going to the market, etc. 

There are further complications, of course.  As our retired population increases, the amount of time devoted to leisure by the whole population is increasing.  But working stiffs seem to be working more, and both husbands and wives are working.  We welcome more data on this subject.  If we are actually working less, then productivity has increased much more than we thought for.  (3/1/06)

216. Auto Perplex
In “The Thrill Is Gone,” we have said that the sun is setting on the automobile, even if the auto industry is bursting at the seams in China, Japan, and Korea, with other Asian nations coming along in their wake.  The auto was right for the 20th century, but is a millstone around the neck in the 21st.  Even so, it is far from boring, and there will no end of good stories to tell as it beats a strategic retreat from the planet Earth.  We will be following the industry here.

Real auto races, far from NASCAR foolishness, still can rock the most jaded observer.  We have mentioned The Cannonball and the Peking to Paris.  And we could easily go off to catch  La Carrera Panamericana, and Stephen Page has been kind enough to detail for us the 2005 iteration.  Appropriately, “the cars are pre-1954 sports and saloon cars with wickedly fast engines and six pot disc brakes that could stop a 747 on an aircraft carrier.”  It would not be Latin America if it did not hearken back to the 50s.  That was when we still dreamed that cars could soar, and we could do anything in such chariots.  In other words, that was back when the thrill was still there. 

It’s such races that take us away from the cares of the auto industry.  GM continues to dig a deeper hole for itself.  Often it makes all the right moves in the wrong direction.  Bloggist Douglas Smith out of McKinsey observes it in “Removing the Deck Chairs from the Titanic”

It still doesn’t “get it” when it comes to the value side of its products.  As previously noted, GM invested heavily in product design and manufacturing flexibility—that is, the capacity to move quicker to provide new products.  It can now bring 15 new products to market quicker than eve before. And, what are the deck chair managers doing with this flexibility.  13 of the new products will be re-designs of full size SUVS.

13 out of 15 are bets on the past.

Update: More Bankruptcies.  Every time we turn around, another bankrupt in the auto industry pops up on our screen.  The grapewine tells us that something like 8 out of 13 of the major auto parts suppliers have gone belly up.  The Detroit News (February 11, 2006), tells us that J.L. French has just gone belly up, but it’s just one of many: “Major suppliers such as Delphi Corp., Collins & Aikman Corp., Meridian Automotive Systems Inc., Tower Automotive Inc. and Amcast Industrial Corp. are all currently operating under bankruptcy protection.”  (3/8/06)

215. A Greener Military
The U.S. Army has moved from grudging compliance with environmental regulations to aggressive advocacy, paralleling a trend among some major multinationals.  At Fort Carson it “has invested in rain sensors for its irrigation systems which, it hopes, will save $80,000 a year; and it may save another $30,000 annually from cleaning and recycling much of it its hazardous paint-cleaning solvent….”  “Reducing the military’s ecological footprint makes it ‘stealthier’, claims Michael Cain, director of the army’s Environmental Policy Institute.”  “The air force is the largest federal purchaser of green power in the country: two of its bases are powered solely by renewable energy, mostly wind” (The Economist, November 24, 2005, p. 43).  AEPI dates back to 1990, and has bounced around a bit from Illinois to Georgia to Virginia.  It seems to be gaining stature, and, at a minimum, its existence suggests that all major institutions in our society are at least beginning to pay lip service to green initiatives.  (2/22/06)

214. The Tweel
Michelin has come up with a new tire that some auto buffs say is the biggest innovation to hit the industry in 30 years.  To wit, it does not use air.  “The heart of Tweel innovation is its deceptively simple looking hub and spoke design that replaces the need for air pressure while delivering performance previously only available from pneumatic tires.  The flexible spokes are fused with a flexible wheel that deforms to absorb shock and rebound with unimaginable ease.  Without the air needed by conventional tires, Tweel still delivers pneumatic-like performance in weight-carrying capacity, ride comfort, and the ability to ‘envelope’ road hazards.”

“Mounted on a car, the Tweel is a single unit, though it actually begins as an assembly of four pieces bonded together: the hub, a polyurethane spoke section, a ‘shear band’ surrounding the spokes, and the tread band—the rubber layer that wraps around the circumference and touches the pavement.”

“While the Tweel’s hub functions as it would in a normal wheel—a rigid attachment point to the axle—the polyurethane spokes are flexible to help absorb road impacts.  The shear band surrounding the spokes effectively takes the place of the air pressure, distributing the load.  The tread is similar in appearance to a conventional tire” (New York Times, January 3, 2005).  But there’s a lot more testing and development to be done before the rubber meets the road.  (2/1/06)

213. Digital Electric Grids
We have commented extensively on the infrastructure deficit in this country, and even abroad, that will necessitate rebuilding in far different ways almost every aspect of the systems underlying our economy—education, electricity, telephone, railroad, government, whatever you can imagine.   Peter Huber, in “Why 99.5% is Not Good Enough,” in Ubiquity, tells us that we need ultra-reliable electric flows to keep our digital civilization clicking.  More about all this can be found in his Digital Power Report.  (1/25/06)

Update: Smart Grids
“In March, Xcel Energy, a Minneapolis-based power utility, announced plans to build the country’s first city –scale ‘smart grid’ in Boulder, Colo.  Because grids today are dumb, with no ability to monitor power once it exits the generating station, the utilities produce surplus power that is wasted.  With smart grids, sensors will check on real time demand and consumers will have the control systems to finetune their energy use. Ontario has now adopted a 20-year energy plans that includes ‘smart grids.’ Dallas and Houston have private programs in the works.  It is thought, too, that dynamic pricing can come into play once the grids are operative, with different rates applied at different times of the day, to level out demand.  New York Times Magazine, December 14, 2008, p. 72.

Update: Why 99.9 Percent is Not Good Enough
Here Ubiquity interviews Peter Huber on the need to redo our electric gird and our infrastructure: “The grid we built up over the last hundred years was built for uses that, for the most part, were quite tolerant of outages and dirty power….But in the information age, a new class of electrically powered systems stand at the center of everything. If you're America Online and your power goes off, you've stranded enormous numbers of people who are counting on your servers. If you're Schwab and your computers go down for an hour, you have an hour of time when people who subscribe to Schwab can't trade stocks.” This implies “a progressive, but fundamental, reengineering of the architecture of the grid -- the power grid itself begins to mirror the architecture of the Web! The Web dispersed the computing power out of the mainframe. Now it drags the grid along behind it, decentralizing and dispersing the electrical supply.”  “The cure, in a nutshell, is to have extremely fast, solid-state switches at the all the points where you need them. If you can flip very quickly between different sources of standby power and grid power, you can achieve your ultimate objective, which is to obtain very steady, smooth power where you want it, at your digital processors and radios and fiber-optic lasers.” (03-04-09)

212. Algae Waste: Purification
William J. Oswald, a pioneer in the use of algae to remedy all sorts of problems, just passed away.  See the New York Times, December 21, 2005.  He studied ways to use algae that included “treating sewage, increasing food supplies, generating energy and facilitating voyages into deep space….”  “He developed a system of ponds in which algae eat and purify wastewater, and built more than 100 around the world.  The algae could then be harvested using his patented process as protein-rich food for animals or people able to ignore its provenance.  The leftover water, now cleaned, could be used for irrigation, as a coolant for engines and even, with more purification, for human consumption.”

Algae and other natural systems for water purification have not received the trial runs they deserve in both developed and developing countries, though there have been some truly concerted efforts in the Third World.  The Ganges River clean-up effort is a very good illustration of the sorts of things afoot in this respect.  Alexander Stille has written about Veer Bhadra Mishra and Oswald in this connection.  John Todd and Beth Josephson surveyed this whole field in “The Design of Living Technologies for Waste  Treatment.”  It is reasonable to assume that our infrastructure designers will have to make better use of natural systems if we are to come to terms with energy, waste, and a slew of ecological problems.  (1/18/06)

Update: Smokestack Algae
Algae pioneer William Oswald would be delighted.  On top of MIT’s 20-megawatt power plant sits an algae factory.  “The algae are eating carbon dioxide and nitrogen oxides from the plant’s emissions—40 percent of the former and 86 percent of the latter—and turning them into harmless oxygen and nitrogen.  Each day, an algae crop is harvested that could be dried and converted to solid fuel or processed into biodiesel or ethanol, transforming a pollution problem into a moneymaker.”  Chemical engineer Isaac Berzin now has started GreenFuel Technologies Corporation, and is trying the technology out at a power plant in the Southwest.  See Sierra, May/June 2006, p. 13.  (6/28/06)

211. Geothermal Pumps
With rising energy prices, geothermal pumps are beginning to enter the mainstream, according to “Heat from the Earth to Warm Your Hearth,” New York Times, January 1, 2006, p. BU6.  Heat to warm houses is pumped up from six feet underground through plastic piping.  The water circulating in the pipe captures enough heat, since the temperature remains consistently warm down deep, enough so to comfortably heat a house, saving perhaps 20 percent or more on energy bills.  “There are virtually no moving parts other than the pump,” and maintenance consists of cleaning a filter every few months.  In the summer, air can be cooled by simply reversing the process.

Installations have been growing 20 percent a year, and a million American homes now have geothermal heat pumps, according to the Geothermal Heat Pump Consortium.  Federal energy legislation now provides more incentives to put in systems.  (1/11/06)

210. Branding and the Senses
Martin Lindstrom says branding is all about touch, taste, smell, sight, and sound.  In his Brand Sense: Build Powerful Brands through Touch, Taste, Smell, Sight, and Sound, this ad executive says we have to go beyond print and TV where we work through the eyes, capturing consumers by connecting with the 5 senses.  “Mr. Lindstrom suggests that brandbuilders can learn from organized religion, where sensory experiences (the small of incense, the cry of the muezzin or the taste of a sacramental wafer) have been blended for centuries to bind consumers closer to  the faith” (The Economist, April 23, 205, p. 80).  (1/4/06)

209. Why Sharing Works
“Technology increases the ability of people to share, but will they share more than just technology?” (The Economist, February 5, 2005, p. 72).  The Global Province has widely explored the subject of collaboration—why in the age of globalization and the Internet, it, rather than competition, produces economic value.  Very small economic units—be they small nations or small business units—working in free alliance with others give rise to superior results, while traditional largescale aggregations are themselves declining in value and are serving as a drag on the economic systems in which they emmeshed.

Further, we would claim that collaboration demands a different state of mind than that which arises in a traditional laisse- faire market environment.  In this regard, see our “The Uses of Prayer.”  Also look at “Investment Outlook: Infrastructure.”  The Economist notes that “[e]conomists have not always found it easy to explain why self-interested people would freely share scarce, privately owned resources.  Their understanding, though, is much clearer than it was 20 or 30 years ago: co-operation, especially when repeated, can breed reciprocity and trust, to the benefit of all.”  There are all sorts of reason for information sharing (which lies at the heart of the knowledge economy).  My use does not get in the way of your use: we both can use it at the same time.  Also the more people that use it the better—if everybody uses it, then communication amongst all is easier.  And, with the Internet, the costs of distribution are virtually non-existent.

Yochai Benkler, of Yale Law School, and others have further made clear that there is a premium for all in the sharing of certain goods such as computing power and bandwidth.  Indeed, such sharing may even extend further in so far as many goods are not in use a great deal of the time, and collective benefits can arise from collaborative use of downtime.

In effect, the contention here would be that economists now understand that people have come to understand that the network effects of sharing more than offset the advantages of going it alone.  We would hazard a guess that there is even a more important reason why people are sharing.  Traditional systems have become cumbersome and bureaucratic, often to such a degree that participants cannot achieve their goals, whatever their resources.  Out of frustration, they move to a “sharing” model. 

Sharing enables agile players.  That is underlined in a recent interview by our managing partner:

In a Ubiquity interview, management consultant and futurist William P. Dunk says: “Besides the brain in one’s head, there's also a brain in the gut that controls the digestive system and so forth.  It’s a fairly serious brain.  I suspect that we’re going to turn out to have more semi-brains, when we look at the body even more thoroughly, and we’re going to conclude that the human system is the right model for man-made systems, because of the human system’s qualities of durability, ruggedness, and resistance to attack.  What collaboration is about is distributed intelligence, and I think that systems and governments and companies are all in such a degree of gridlock now that we desperately need to have broad-based intelligence coming into play everywhere.”  (1/4/06)

208. Keeping Up on Japan
It’s hard enough to keep up on any society.  But a few—Japan, Singapore, and a few others—make a few of their interesting initiatives transparent for all to see, if we will only take a look.  We find delightful, for instance, Trends in Japan, sponsored by the Ministry of Foreign Affairs.  This is unusually hip for a government website, and it takes you through everything from fashion to science to business and even arts and entertainment.  This is an intelligent way of bragging about one’s nation.  (12/28/05)

207. Nature's Flood Control
We depend too much on the levees built by the Army Corps of Engineers and even fancier works devised by engineers in Holland to restrain rivers, and lakes, and oceans—all of which becomes a bit more difficult if we are having a patch of global warming.  Better that we should let wetlands on our shores and in marshes return to health, because they’re part of Nature’s intelligent design to protect our Continents.  “In Britain alone, over $725 million a year is spent defending the most vulnerable communities from river and coastal flooding using embankments and other structures” (The Economist, October 23, 2005, p. 80).  Howard Wheater and colleagues at Imperial College in London have been working around the Severn River in Wales to see how effective vegetation is in cutting severe rain flows.  “In areas planted with young, broad-leafed trees—and with no livestock grazing—it was up to an impressive 80cm an hour when the trees were only seven years old.  Indeed, even two-year-old trees made a perceptible difference.”  Turning unused farmland back to woodland would help a lot.  Even more, provisions for foresting new building developments and the like would also help immensely.  (12/14/05)

206. Handy on Gurus and the Future of Work
English business guru Charles Handy—he now prefers to call himself a social philosopher—gives a guided tour of a slew of business gurus: some great, like Michael Porter and Peter Drucker, and some not so great, like Bill Gates and Tom Peters.  The short introductory material is a bit helpful, but the audios are a chore and only for the dedicated.  A better place, however, to look at gurus, leading thinkers, etc. is Aurora Online, which comes to you from Athabasca, Canada’s Open University.  The thinkers on Aurora are not, with a few exceptions, business gurus, but they are thinkers about society and hence more illuminating about the future issues with which major corporations are grappling today.  They’re less well known but better at articulating matters that will deeply affect corporate strategy.  In an Aurora interview, the provocative Handy says, “Statistics in Europe already show that not only are 10 per cent of people who want to work not able to get it, but another one third of the work force is working outside an organization.  That is, they are self-employed or working part time for temporary periods, selling their services or goods into an organization.”  “I mean that we are beginning to see the end of the employee society.”  Handy himself, a survivor of Shell Oil and academia, has become just such an outsider.  (12/7/05)

205. Profits of Doom
As much as anybody, Ernest Sandberg at the University at Buffalo has cornered the academic disaster market.  In planning, he is doing considerable work on terrorism and natural disasters.  He has also ploughed a lot of  other ground as evidenced by his book The Economy of Icons: How Business Manufactures Meaning in which he claims that image not information is the driving force of our economy.  We find it interesting to discover how image conscious Sternberg and his colleagues are: they positioned themselves well to attract notice from Hurricane Katrina, and the press took the bait. Probably more profound is Theodore Steinberg’s book Acts of God: The Unnatural History of Natural Disaster in America.  It documents how many natural disasters have been magnified through grave human error.  Hurricane Katrina was magnified by the huge loss of wetlands in the Gulf area.  Interestingly, we find the theoretical work on disasters and disaster recovery is really a bit thin.  (11/2/05)

204. Fighting Hurricanes
Moshe Alamaro of MIT proposes “the creation of small, man-made tropical cyclones to cool the ocean and rob big, natural hurricanes of their source of energy.”  He figures offshore barges with upward-facing jet engines can cause evaporation and cooling on the ocean’s surface. “Protecting Central America and the southern United States from hurricanes would cost less than $1 billion a year.”  See The Economist, June 11, 2005, p.8 (Technology Quarterly).  (10/12/05)

Update: Managing Hurricanes; Making Rain.
As it turns out, scientists are playing around with a number of schemes for managing the weather.  Ross N. Hoffmann, VP for research at Atmospheric and Environmental Research Inc. in Lexington, Mass, has done computer simulations showing that minor atmospheric adjustments could make a big difference in the weather.  A rise of 2 to 3 degrees can turn the weather around, though nobody has a clue as to how to pull that off outside the lab.  Hoffmann and others think this might be achieved by beaming energy down from satellites or by sprinkling rainmaking chemicals on the clouds near the hurricane’s eye.  Damian R. Wilson, in Britain’s weather service, has proposed coating the ocean with vegetable oil to prevent hurricanes from lapping up water.  See Business Week, October 24, 2005, pp.64-66. 

Weather management is also being brought to bear to create rain and prevent hail.  China has 35,000 people working the weather, with a budget of $40 million a year.  Even with no federal funding, a host of states are spending money on cloud seeding to get snow or end drought.  The Russians and Mexicans, rather than seeding clouds, beam up charged ions from the ground.  (11/23/05)

203. Shangri-La Diet
As you read sundry pieces on him, you discover Seth Roberts is more than a bit eccentric, so you must take all his words of wisdom with a stout serving of some ironic brew.  He has suddenly gotten a bit trendy because he appeared in a magazine column by a Chicago trendy, Steven Levitt, the father of Freakonomics, which lies by our bedside unread. Levitt is very fond of counter-intuitive insights (see “Quantum Thinking” and “Chicago Has Got It”) and Roberts provided him with some fodder.  In effect, Roberts theorizes that man has been imprinted with a strange appetite mechanism since hunter and gatherer times.  When his sensory mechanism feels there is a lot of food around, he gorges. Amidst plenty, the sin of gluttony becomes manifest.  Instead of stopping when we have had a delicate sufficiency of food, we keep stuffing ourselves to the gills, our instincts fearing that we shall not again encounter such plenty for many a day.  But if we feel things are scare, our appetite lessens, and we adjust to reality.  Tricking his own bodily mechanism, Roberts managed to lose 40 pounds to prove his theory.  He had struck out on everything else—a sushi diet , a tubular-pasta diet, a waterlog diet, etc.  While this article appeared in The New York Times Magazine, September 11, 2005, you can best read about this at www.gadsdentimes.com/apps/pbcs.dll/article?AID=/20050911/ZNYT04/509110341/1011.  To get more into his stone-age theories, read http://calorielab.com/news/2005/09/12/lost-diet-secrets-of-the-stone-age-revealed.  The Levitt blog, meanwhile, captures a lot of back and forth on his diet, including more comments from Roberts (www.freakonomics.com/blog.php).  Roberts own summary of his hunches about our body’s stone-age chemistry can be found at http://psychology.berkeley.edu/directories/facultypages/robertsresearch.html.  Roberts has other fun thoughts, such as that sleeplessness may result from sitting around too much, and walking and standing can help make you sleep like a rock.  And that self experimentation is a particularly good way to produce new insights (http://repositories.cdlib.org/postprints/117). 

We asked Mr. Roberts why he called it the “Shangri-La.”  He replies: “Because it puts people at peace with food—like being in Shangri-La, a peaceful place.  Reduces or eliminates food compulsions, such as eating between meals and eating late at night.  It is also a kind of ideal diet, just as Shangri-La was a kind of ideal place.”  In other words, we avoid the frenzy of feeding in Shangri-La.  (10/12/05)

202. New Classes of Antibiotics
“Most of the commonly used antibiotics today are derived from soil-based order of germs known as Actinomycetales.  But their frequent use with human beings has led to resistant strains of bacteria.  Now microbiologists such as Norman Pace at the University of Colorado are plunging into caves to discover brand new organisms or extremophiles in caves, and he has devised new ways to reproduce them.”  Hazel Barton at Northern Kentucky University, a Pace protégé, “has identified 24 new microorganisms with antibiotic properties.”  “Extremophiles have shown some practical value in the past decade.  Diversa, a California biotech, has isolated an enzyme from a volcanic crater in Russia that is now being used to whiten paper….  A bacterium called Thermus aquaticcus, founded in a hot spring in Yellowstone National Park, has become the basis for polymerase chain reactions used in medical diagnosis and fingerprinting.”  Barton was featured in Journey into Amazing Caves, an Imax movie (www.amazingcaves.com).  (10/5/05)

201. Scholar Bloggers
In academia we used to say, “Publish or Perish.”  Alas, nobody will perish anymore because the Internet has provided anybody suffering from verbosity and a lack of writing discipline a playing field where she or he can go from digression to digression 24/7.  Going back a few years, you can read about the spread of academic blogging in the Chronicle of Higher Education at http://chronicle.com/free/v49/i39/39a01401.htm.   Even the best and brightest can get a bit tedious on their blogs: in this vein, read Judge Posner and Economist Becker at www.becker-posner-blog.com, which is sort of drawn out, though both fellows have first-rate minds and deserve a following.  By the way, almost all academic blogs need an easy search list of topics, so that we can separate the wheat from the considerable chaff.  Curiously, the University of Chicago seems to produce an outsized number of blogs, telling us that the academics there get a bit lonely and want to peddle their wares on both the coasts.  There are various scholarly blog indexes around, none of them great but at least it’s a way to find out about these outpourings.  Try http://farrell.blogspot.
com/2003_04_13_farrell_archive.html#92862389.  You will come away convinced that at its best academic writing is not very rigorous or disciplined.  Nonetheless, we find the idea of the scholarly blog tantalizing since we need better ways of rapidly getting knowledge from the lectern into the public marketplace.  (10/5/05)

200. Talking about Big Issues
In our over-digitized lives, where we are horribly subject to distraction and where we don’t take time to even read the daily newspaper, we have become difficult to talk to about deeply important matters.  It’s a task for those who care about long-term worldly issues to communicate about them with the vox populi.  But that just means that creative people are getting more imaginative.  Richard Curtis, writer of Four Weddings and a Funeral and Notting Hill, is out with yet another romantic comedy, The Girl in the Café.  Except in the background, this film deals with the plight of poor nations, helping revive the concept of massive debt relief, something the world had to do in the thirties (www.hbo.com/films/girlinthecafe/synopsis).  Ironically, of course, the U.S. has just tightened up its personal bankruptcy laws, something it will have to reverse, given its widening, dramatic gap in incomes between the rich and the poor. Well, we don’t know how the movie is, but we will give it a go.  We are hoping for pleasant propaganda and colorful people.  It is not only the politically correct who are out with art that pushes ideas: Michael Crichton’s State of Fear throws brickbats at the global warming polemicists.  (9/14/05)

199. Biomimetics
“Velcro is probably the most famous and certainly the most successful example of biological mimicry, or ‘biomimetics.’” (It came about because Swiss inventor George de Mestral saw the hook and loop system seeds use to cling to animals, and knew the idea could be duplicated by technologists).  Imitating fish, Nekton Research in Durham, North Carolina has developed a robot fish that uses fins instead of a propeller to get about.  All sorts of experimental robots are using principles gathered up from models in nature.  See The Economist, June 11, 2005, pp. 18-22.  (9/7/05)

198. Patching-up Ones Genes
Purdue University scientists have found plants that have “a corrected version of a defective gene inherited from both their parents, as if some handy backup copy with the right version” lurked in their heritage.  “If confirmed, it would represent an unprecedented exception to the laws of inheritance discovered by Gregor Mendel in the 19th century.  Equally surprising, the cryptic genome appears not to be made of DNA, the standard hereditary material.”   See “Genome-wide Non-Mendelian Inheritance of Extra-Genomic Information in Arabidopsis,” by Lolle, Victor, Young, and Pruitt in Nature (www.nature.
com/nature/journal/v434/n7032/abs/nature03380_fs.html).  “The finding poses a puzzle for evolutionary theory because it corrects mutations, which evolution depends on as generators of novelty” (New York Times, March 23, 2005). Clifford Weil has some details about this very remarkable development on his vita at www.agry.purdue.edu/
staffbio/weilbio.htm.  (8/31/05)

197. Shale
We have talked extensively about alternate sources of energy—wind, solar, ocean power, etc.  Right now, clearly, windpower has a tornado at its back, and it is making the most progress throughout the world and especially in Europe, North America, even China.  Gradually, but still gradually, technology is making solar and ocean power more viable, but we still have a ways to go.  The energy mandarins tell us that these alternate sources will never amount to much, and, like it or not, we will have to get our electricity from fossil or nuclear power.  There is even a revival of interest in nuclear fusion.  We are not sure, however, that both these alternate sources and dramatic conservation programs cannot make a huge dent in our energy needs. 

So far we have not paid much attention to oil from shale and tar sands.  There is considerable potential here and there are viable shale companies in business now.  This is another fossil fuel source we have only begun to tap.  In this respect, one should pay attention to Canada’s maverick province, Alberta.  Is premier Ralph Klein pushes good relations with the U.S., advocates a Canada-U.S. missile defense system, thinks the Kyoto Protocol could stifle economic growth, and is looking for private initiative reform of Canada’s national health care system where patients may have to await several months for treatment.  Alberta can be different because, among other things, it sits on lots of oil.  “Alberta’s 176 billion barrels of oil reserves are the greatest proven stock outside Saudi Arabia.  But most of  those reserves are in oil sands, a thick substance only profitable to extract when world energy prices are high as they are now.”  See the New York Times, February 6, 1005, p. 8.  Alberta officials “predict that the one million barrels of oil a day produced from oil sands last year will rise to two million by 2010 and to three million by 2020.”   It only has 3.2 million people (10 percent of Canadian population), but it is by far the fastest growing.  Extraction of the oil is messy, costly, and energy-consuming.  Both government and private companies are trying to make the process cleaner.  “They include proposals to reuse and store greenhouse emissions like carbon dioxide, to recycle the byproducts of oil sands development and to produce cleaner burning natural gas from coal.”  

Meanwhile, the U.S. Government and others are working harder again on shale extraction.  “The Pentagon is working on plans to direct, within four years, a portion of its $5.5 billion fuel-purchasing budget for high-quality oil, extracted from sedimentary-rock formations” in Utah.  The Interior Department will begin leases of land in the West for R & D on oil shale.  Shell is starting up new shale projects in the U.S. and China.  There are apparently two ways to get at the oil: mine the rock and crush it or heat the rock in the ground and then pump out the kerogen (Wall Street Journal, March 10, 2005, p. A4).  “The world’s richest source of oil shale is called the Green River Formation, 16,500 square miles of deposits beneath parts of Colorado, Utah and Wyoming.  The most productive part of that is the ‘Mahogany Zone,’ a layer of rock that runs through it.” There are several interested venturers in the shale market to include Byron Merrell, whose Oil Tech enterprise has “attracted $2 million in backing”  (www.oiltechinc.com/history.html). 

The migration to alternate energy sources seems to be picking up quite a bit of steam.  Jigar Shah of Baltimore-based SunEdison LLC thinks the sun could supply up to 10% of the country’s energy requirements, and he has just announced a $60-million fund financed by Goldman Sachs and others which, among other things, will lead to installation of 25 electric systems in Staples, Whole Food Market stores, and other locations (See Business Week, July 4, 2005, pp. 36-37 and   www.sunedison.com/index.php).  “In its so-called Green Wave Initiative, California plans to use $500 million from two state pension funds … to see proposals for alternative energy” (www.treasurer.ca.gov/greenwave/).  “Wind-power costs have declined to as little as 3 to 5 cents per kwh….  GE’s wind business has soared from $500 million in 2002 to a predicted $2 billion this year.”  Venture capital is flowing into high-tech firms making sundry solar materials such as Miasole and Nanosolar.  (See http://miasole.com/ and http://miasole.com/.)  (8/10/05)

196. Burst of Corporate Cash
“‘The real driver of this savings glut in recent years has been the corporate sector … and the rise in corporate savings has been truly global,’ J.P. Morgan economists noted in a recent report” (Wall Street Journal, July 21, 2005).  “Savings by companies in rich countries increased by more than $1 trillion from 2000 to 2004, J.P. Morgan economists estimate.  Measured against the size of the global economy, companies haven’t been this thrifty at any time in the past 40 years….  Greenspan said that 2003 was the first year since the recession of 1975 that U.S. companies’ capital expenditures were below corporate cash flow.  …  Yet if it persists, it suggests something worrisome about the global economy.  Tomorrow’s economic growth and rising living standards depend on today’s business investment.”  See Morgan report at http://pull.jpmorgan-research.
com/cgi-bin/pull/DocPull/30969-AFE3/95584298/Global_Savings_GIut.pdf.   

In our Annual Report on Annual Reports 2005 (see 13 July 2005: “Annual Reports from 2004: Hubris: The Fat Cat Gets Fatter”), we have argued that the world is awash with cash and companies are not spending it well.  Lots of silly mergers are taking place.  Basically companies do not know what to do with their cash or where to correctly invest it.  None of the reports we have seen thus far address the fact that neither the capital markets nor corporate treasurers are allocating cash wisely.  (8/3/05)

195. Much Better Speech Recognition
We have made wonderful progress with speech recognition.  A smart company with good design sense can tastefully handle many customer service chores with speech recognition modules.  Still and all, most systems are still fairly primitive.  “Using a new, hardware-based approach … researchers hope to create a chip that performs speech recognition much more efficiently than is currently possible using software-based recognition systems.”  A chip would consume much less power than software applications, facilitating usage in small, mobile systems.  Carnegie Mellon, in particular, has an “In Silico Vox” project underway.  See The Economist, March 12, 2005, p. 11.  (7/20/05)

194. The Keeling Curve
No matter where you come down on the issue of global warming, you owe Charles D. Keeling a tremendous debt for measuring carbon dioxide concentrations to help us understand they are ever rising.  He passed away June 20, 2005.  It is perceived that CO2 is a greenhouse gas, which traps heat in the atmosphere.  Even when government funders tried to shut him down, he kept his measurements going to show us the accelerating long term trend.  “More recently, in 1996, Dr. Keeling and colleagues showed that seasonable swings of carbon dioxide levels in the Northern Hemisphere were becoming larger … possibly a sign that the growing season is beginning earlier because of global warming.”  (New York Times, June 23, 2005, p. C20.)  As a postdoctoral fellow at California Institute of Technology, he invented the first instrument to measure atmospheric carbon dioxide.  His son Ralph has devised a way to measure atmospheric oxygen as well.  His measurements are taken by some to be the most important environmental indice of the 20th century.  See the Boston Globe, June 24, 2005, p. B8.  (7/6/05)

193. Ethnomathematics
Renowned historian of education Diane Ravitch points out that math instruction is being politicized, further diluting the quality of teaching.  (See the Wall Street Journal, June 20, 2005, p. A14.)  From 1973 to 1998 Ravitch notes a dumbing down of the subject matter of math textbooks and an elimination of basic skills training, since some thought kids should just rely on calculators for the basics.  “Now mathematics is being nudged into a specifically political direction by educators who call themselves ‘critical theorists.’  …  Partisans of social justice mathematics advocate an explicitly political agenda in the classroom.  …   It seems terribly old-fashioned to point out that the countries that regularly beat our students in international tests of mathematics do not use the subject to steer students into political action.”  (7/6/05)

192. Creative Brain Drain
Richard Florida at Carnegie Mellon, author of Cities and the Creative Class and Rise of the Creative Class, is not an original thinker, but he is a very good popularizer of ideas that are floating around in academic pastures.  Many, including Florida, have noticed that talent, especially bright foreign graduates of our universities, are drifting away from America, no longer hanging about to work their wonders here.  University graduates, over from China, don’t go to Silicon Valley but return to Greater China.  Florida’s version of our creative brain drain is pretty well summed up in an his article “America’s Best and Brightest are Leaving and Taking the Creative Economy with Them,” in Across the Board, September 2004, pp. 34-40.  (6/8/05)

191. Under the Spreading Chestnut Tree
We have long talked about Roger Holloway’s divine mission to bring the elm back to America.  See “Tall Trees and Sturdy Men” and also our Global Province Network, where we talk about River Edge Farms.  He is meeting with much success, particularly in Washington, D.C.  There, public and private monies are planting elms all over town, even in the vicinity of the White House. 

Just as disease has taken down the bulk of elms across America, it has also struck the American chestnut.  And a similar effort is afoot to bring back that most worthy tree. Who can forget Longfellow’s “The Village Blacksmith”: “Under a spreading chestnut tree / The village smithy stands.”  But the American Chestnut Foundation (www.acf.org) has now crossed the disease-resistant Chinese Chestnut (6%) with the noble American Chestnut (94%).  And Arbor Day this year witnessed the President and the Secretary of Agriculture planting a chestnut at the White House.  In Bennington, Vermont, hearts swelled since the Foundation makes its home there.  (See www.benningtonbanner.com/Stories/
0,1413,104%257E8678%257E2844420,00.html.)  Disease, rapacious development, and a depleted environmental movement have taken their toll on the nation’s noblest trees.  But everywhere we turn, determined advocates for our noblest trees are turning up, whether it be Chuck Leavell on his tree plantation in Georgia or San Francisco’s most distinguished architect, Bernard Maybeck, who appeared before the town of Berkeley early in the 20th century to defend a “noble and thrifty tree” on the north side of campus which just happened to sit in the middle of a street.  For more on this, see Susan Freinkel, “Under the Spreading Chestnut Tree,” New York Times, April 30, 2005, p. A27.  (6/1/05)

Update: Fred Hebard.  “American Revival” (Audubon Magazine, March-April 2006, pp. 27-35) gives a detailed, on-the-ground report on the effort to revive the chestnut.  Fred Hebard is chief bottlewasher and everything else for the American Chestnut Foundation, and he’s leading the charge.  The account here is excerpted from Peter Friederici’s Nature’s Restoration.  What stripped the landscape was Crypbonectria parasitica, a fungus that made its way here on Asian chestnut trees.  Previously Asian chestnuts were crossed with Americans to ward off the blight: the result was a bunch of stubby trees.  But the American Chestnut still survived and one Charles Burnham advised crossing it with the stubby Asian Americans to recapture the American Chestnut’s glory.  By 2004, Hebard developed “hybrids with a genetic heritage that was 93.75 percent American and 6.15 percent Chinese.”  Of course, our own tree consultant says the chestnut is a bothersome tree, and that he will not be planting any, anytime soon.  (4/5/06)

190. Rec Wreck
“Which part of the economy is losing jobs the fastest these days?  …  It’s the arts, entertainment, and recreation sector, which is down by 48,000 jobs over the past years. Americans seem to be more interested in listening to their IPods, browsing the Internet, and enjoying their big-screen TVs than in playing golf or going to live  performances.  Even casino employment is lower than it was a year ago.”  See Business Week, April 18, 2005, p 12.  This is even a more profound observation than the editors of Business Week understand.  Americans are too busy, first off, and don’t even have time to go out to lunch.  Many live entertainments are simply not affordable.  Children are growing up too fast, and the collapsing toy market has felt the impact of iPods and video games which have squeezed out traditional toys in kids past ages 10 to 12.   As we made clear in “Empty Palaces,” museums that are pursuing very expensive, glitzy overhauls are probably in for a big surprise when stay-at-home Americans are no longer filling their coffers with daily admission revenues.  (5/11/05)

189Linux for Biotech
Researchers have now described a way to transfer genes into plants that supplants agrobacterium transformation, a technique surrounded by a wall of patents.  See The Economist, “The Triumph of the Commons,” February 12, 2005, pp. 61-62.  Affiliated with CAMBIA (www.cambia.org), a non-profit research group in Australia, they’ve made the new process free under license.  The group “also unveiled a website, BioForge.net, to help biotech researchers to collaborate, much as SourceForge.net is a nexus for open-source software development.”  On another front, “Science Commons, an offshoot of Creative Commons (which provides less restrictive copyright licenses to authors), is preparing to develop open licenses later this year.”  Monsanto, the dominant holder of patents around the older technique, seems to claim that Cambria complements, rather than threatening what it is doing.  For more on  “Free” and “Open Source,” see “Free for All” on Agile Companies.  (4/27/05)

188Empty Palaces
Debt-ridden Cleveland, with the highest poverty rate in the country, and a loser of jobs for decades, is plunging into debt for an expansion of the Cleveland Museum of Art. “There are a dozen or more museums around the country presently planning or carrying out expansions.”  What’s up, says Eric Gibson in The Wall Street Journal (March 7, 2005, p. A19) is not just a need for more space, but a rush into snazzy architecture, a museum trend ignited by Frank Gehry’s Bilbao Guggenheim museum.  “Instead of continuing to assume visitorship will grow indefinitely and that they should build accordingly,” museum officials “should begin to imagine a future where demand slackens….”  There’s a “societal swing towards escape into a self-sufficient virtual Arcadia,” where institutional extravaganzas are being replaced by adventures on the Internet and quiet sessions with one’s IPod.  In other words, these new museums may be very, very empty.  

Many leisure markets are to feel the pain of  shifting consumer habits, where Everyman and Everywoman find their glee in virtual worlds.  IPods and videogrames have wreaked havoc in traditional toy markets as children virtually give up their Lincoln logs and Barbies by age 12.  Newspaper circulations continue to decline as TV, online portals and publications, and loud talk radio sop up audiences.  Not letting money burn a hole in their pockets, the Guggenheim, which at least has made an effort to de-centralize its operations to several locations, and the Metropolitan in New York, which has smartly rebuilt old spaces, are both showing a more prudent response to the fickle tastes of the consumer at leisure in the twenty-first century.  (4/5/05)

187Tilting at Windmills
A couple of young saber wielders (Michael Shellenberger and Ted Nordhaus) have rattled the chieftains of the environmental community because they gave a speech at Middlebury College—much overstated—entitled “The Death of Environmentalism.”   Accredited environmentalists like to write a lot, so you can find all sorts of moanings and groanings about this speech on the Internet.  The speech itself is a bit turgid, but read it if you must, by going to www.thebreakthrough.org, where you will find a link to it.   

Of course, the title is a bit silly, since the movement is very far from dead, even if the current New Mobile classes do not care for trees and all the other kinds of things we associate with “environment.”  Environmentalism is out of step and needs to be brought up to date.  The two authors rant about American values and the need for the marginalized environmental movement to connect up with them.  We suspect that the kinds of things environmentalists need to do to regain their perch are a little less lofty.   

You will remember that a historian, a few years back, entitled his book The End of History and the Last Man in order to get a little attention.  Last we looked, history is still with us.  Likewise, we’re still encountering greens everywhere we go, and we see recyclying baskets in front of very Republican houses in fancy subdivisions every week.  This movement is far from dead. 

That it needs a shake up is self evident, even to the more thoughtful leaders trashed by the kids in their speechmaking.  For more on the quest for renewal, read “Turkey Restoration: Green Renewal.”  To get real traction, the Greens will have to figure out how to cut a global swathe in the future, acting them much less like a series of national movements.  That is, they will have to catch up with history, which has become so global that it would give the dialectical German philosopher Hegel infinite pleasure.  The Greens need to clarify their agenda and to clean up their tactics. 

One insight of the authors is well worth repeating.  American support for the environmental movement is very broad, but very shallow.  The passion for it is only “skin deep,” and is easily displaced by other concerns.  In an age of downsizing, where many are just trying to survive and get by, causes that are just perceived as nice-to-do get put on the back burner.  Similarly, public broadcasting has lost a lot of its committed support, even though it still owns a wide franchise throughout the country. 

Part of the deterioration arises from division within the ranks of environmentalists because enthusiasts will only fight for one narrow goal rather than the broad idea of environmental preservation.  In this vein, read Bill Mckibben, now a visiting scholar at Middlebury College and author of “Tilting at Windmills,” New York Times, February 16, 2005, p. A27.  Windmills for energy, which have taken hold more in Europe than America, are now spreading faster in the United States, notably in New Mexico where the Governor is touting the state as the home of alternate energy.  In the East, the Greens and the well heeled are resisting the spread of windmill farms off of Cape Cod, in the Adirondacks, and in other places.  Because of global warming, McKibben welcomes them as a way to stave off the burning of more fossil fuels.  This is just one of many splits in environmental thinking: it’s hard for America to get behind such a fuzzy, conflicting agenda. 

In spite of themselves, the Greens are just beginning to receive help from an independent cultural trend that is picking up momentum.  There’s now a move towards less consumption, a simpler life, and more contemplative activities.  See our “The Post Consumptive Society.”  (3/30/05)

186Best Gadgets of All Time
The list does not live up to the billing, but it’s great idea.  Mobile PC Magazine tries to do a compendium of the 100 best, but you will quickly discover that maybe 5 or 10 would ever have a chance of making it into your household.  Despite a half-hearted effort to include items from olden times, most of the stuff comes out of the last 50 years, much of it suffering from poor engineering and a confusing excess of functionality.  You won’t find the clothes pin or other rudimentary greats here.  The wrong scissors make it on the list.  But it’s fun to be reminded of the Sony Walkman (1979), Polaroid Land Camera (1948), Swiss Army Knife (1891), Telephone (1876), Cusinart Food Processor (1973), Polar Wireless Heart Rate Monitor (1977), and the Black and Decker Dustbuster (1979).

We think the 1970s were creative times when gadgets came out that broadly helped the quality of life in America, a contrast to the many digital toys that have come later  to sate the insatiable appetites of nerdies and techies for complicated devices that use a lot of batteries.  See www.mobilepcmag.com/features/2005_03/top100gadgets.html.  (3/16/05)

185Wikinews
Yes, we know that it sounds something from the hula hoop circuit in Hawaii.  But the Wiknews, Wikimedia, and several other Wiki names besides actually provide a home for a rather serious enterprise.  In general this is an effort at collaborative research, news gathering, reporting, etc.  In other words, it is a knowledge sharing enterprise that tries to tap into anybody and everybody that has something to add to the pot.  “The largest Wiki project,Wikipedia, has been online for four years and contains more than 450,000 articles, all written and open to revision by its more than 150,000 users.  …  Central to Wikinews is its commitment to neutrality,” according to Jimmy Wales, a founder and president of the nonprofit Wikimedia Foundation.  Wikinews has only been going since December 2004.  See The New York Times, February 20, 2005, p. E5.  Global Province will be doing a longer commentary on this enterprise.  Other somewhat similar participative news projects include Indymedia (www.indymedia.org) and OhmyNews out of South Korea.  See http://wikimediafoundation.org/wiki/Home and www.wikipedia.org/.  (3/9/05)

Update: More on Wales Jimmy Wales, founder and eminence at Wikipedia, is now turning into a minor celebrity and is slated to speak in “more than 30 countries this year.”  See Forbes, September 5, 2005, p. 122.  Wales made a pot of money trading options in Chicago and has since been a jack of any trade that interests him.  “He founded a search service called Bomis which also traffics in naughty pictures.  Wales then built an online encyclopedia he called Nupedia.”  It only put together a couple of dozen articles.  Then in 2000 he heard about the wiki technology and he was off to the races.  See more about him and Wikipedia at “Gales of Creative Destruction? Islands of Self Reliance,” 14 September 2005.  (10/19/05)

184Bankruptcy Tsunami
Personal bankruptcies in the USA have, in general, been surging since the early 1990s due to a variety of forces to include dislocations in the employment market, totally undisciplined lending by super-growth minded financial service companies, a growing underclass with falling income, etc.  Now we are about to see an upwards spike in bankruptcies of public companies.  “After years of a relative vacuum of corporate flameouts, Winn-Dixie (WIN) on Tuesday said it is filing for Chapter 11 protection from its creditors.”  “The lowest-graded junk debt accounted for 42% of total junk-bond issuances last year, S&P says, up dramatically from 30% in 2003.  When that happens, it's only a matter a time before many of these companies begin to fail.  “When we see the most speculative of the high-yield (junk-bond) market issuances increase, that really acts as an early warning sign the default rate will be ramping.”  See USA Today, February 23, 2005.  Lenders to lower quality debtors will become more circumspect amidst rising interest rates, margin squeeze, and the domino effect of sundry failures.  (3/2/05)

183Oil, Oil Everywhere?
We have been very busy telling you to buy yourself several pairs of winter underwear, because the world is running out of fossil fuels, and it seems destined to make a very uneasy transition to fusion energy and other alternatives.   See “Electric Power and Staying Power,” as well as items 58, 86, 141, 166, 177, 178, and 180 on Big Ideas. 

Nothing is as simple as it seems, so we will now confuse you and ourselves yet more.  Take a peek at The Bottomless Well: The Twilight of Fuel, The Virtue of Waste, And Why We Will Never Run Out of Energy by Peter Huber and Mark Mills.  Or get the short version in “Oil, Oil, Everywhere…,” Wall Street Journal, January 27, 2005, p. A13.  “The price of oil remains high only because the cost of oil remains so low.  We remain dependent on oil from the Mideast not because the planet is running out of burled hydrocarbons, but because extracting oil from the deserts of the Persian Gulf is so easy and cheap that it’s risky to invest capital to extract somewhat more stubborn oil from far larger deposits in Alberta.”  “In sum, it costs under $5 per barrel to pump oil out from under the sand in Iraq, and about $15 to melt it out of the sand in Alberta.”  “The $5 billion (U.S.) Athabasca Oil Sands Project that Shell and ChevronTexaco opened in Alberta last year is now pumping 155,000 barrels per day.”  “And capital costs are going to keep falling, because the cost of a tar-sand refinery depends on technology, and technology costs always fall.  Bacteria, for example, have already been successfully bioengineered to crack heavy oil molecules….”  “U.S. oil policy should be to promote new capital investment in the United States, Canada, and other oil-producing countries that are politically stable, and promote stable government in those that aren’t.”  Is it possible that we won’t have a fossil fuel crisis?   

Please notice that  we have rather neglected the issue of tar-sands and will take it up in future notes. Alberta, incidentally, because of its oil wealth, is able to sneer at the fellows in Ottawa.  Don’t be surprised if it separates from Canada well before Quebec. (2/9/05)

182Theory of Embedded Wrongs
We believe that complex societies, institutions, companies, and systems of all sorts easily reject powerful new truths because they are encrusted with outdated ideas and formed around a deeply held system of thought which resists new insights, even those that may save the institution, system, or company that is built on a flawed premise.  In computerdom, we have come to realize that the tragedy of legacy systems is that they are full of flawed patchwork that is almost impossible to repair, a perfect analogue for the broader situation we are describing.  These systems contain the seeds of their own destruction.  We call the tragic flaws that defeat all change and which are akin to the condition of resistance we discuss in psychology—we call them embedded wrongs. You can learn more about them at our Global Province letter, “Enemy of the People: Innovation,” and in the January-February 2005 issue of  Across the Board, the magazine of the Conference Board, at www.conference-board.org/articles/atb_article.cfm?id=297.   Since the end of the Cold War, we think, the embedded wrongs of major countries have allowed smaller countries to outdistance them in the implementation of new ideas and in economic progress.  See item 229 on Agile Companies.  Should all this be true, it would cause us to rethink all the simplistic assumptions about change that are bruited about in business schools, around Departments of Psychology and Political Science, and near the debate platforms of the politically ambitious. (2/9/05)

181Holy Moly, Mongolia
We first started to focus on Mongolia because of Jim Rogers, who remarked on how wired it is in his recap of his journey around the world with wife Paige Parker.  See “Rounding the World Then and Now.”  Since, we have discovered that it is full of surprises, and is one of those “Falling off the Map” countries that you have to watch because it will change the world. 

In “A Mongolian and His Nation, Evolving Together,” New York Times,  December 25, 2004, p. A4, we learn that Mongolia is “Central Asia’s only multiparty democracy.”  Tsakhia Elberdorj, the prime minister, studied in the Soviet Union, but also did graduate  work at Harvard and a stint as journalist throwing zingers at prior authoritarian leaders.  His “Liberty Center Foundation … is overseeing translations into Mongolian of the works of Milton Friedman and Frederick A. Hayek” as this nation, which has privatized its herds, rushes into free market capitalism.  Sandwiched between Russia, China, North Korea, and other hard-rule states, it is tearing down statues of one-time Stalinist leaders and erecting a huge statue of Genghis Khan, the nation’s most renowned leader.  He has a new Mongolia-English website at www.open-government.mn/english/aboutnew/index.php.    

If we are to believe the Times, the cultural emanations from fast changing Mongolia, which have a nationalist tinge, are a bit threatening to the powerful Mandarins in China who are trying to combine freewheeling capitalism with one-party, rule-from-the-center government.   In “The Mongolians are Coming to China! With Heavy Metal!,” New York Times, November 26, 2004, p. A4, we find that the band Hurd from Ulan Bator, going south to Hohhot, capital of China’s Inner Mongolia Autonomous Region, learned that they were banned, perceived as a hot potato that might incite the denizens to gosh knows what.  Obviously their hit CD, “I Was Born in Mongolia,” surely counterpoint to “Born in the USSR,” had struck too big a chord already with the locals.  “Hurd, which means speed, has done three concert tours in Inner Mongolia since 2000,” prior to its current celebrity.  The Chinese are ruling Southern Mongolia with a heavier hand, given disturbances amongst its ethnic minorities all over China as well as among its peasant populations.  Lately too, a Han Chinese company took over the running of the Genhis Khan Mausoleum, a big tourist moneymaker which had been under the Darhad Mongolian Tribe since 1696. (2/9/05)

180Fusion Time
Fusion, as a source of energy, is an idea that refuses to die.  To learn of its history and its prospects, read the attached essay, “Plasma Physicists and the Search for Their Holy Grail: Nuclear Fusion,” by William Grossmann.  For yet more on fusion, look at Berkeley’s website on the subject www.nuc.berkeley.edu/fusion/fusion.html or peruse the journal for this field at www.kluweronline.com/issn/0164-0313.  You can also find a useful timeline of meetings on fusion energy and some other sources at http://fusionpower.org/
AnnualMeetings.html.  In general nuclear power of all sorts poses the same kind of problem raised by fossil fuels.  Even when you come up with technically optimum ways of  generating energy, you still wind up making the world a little toxic due to emissions and byproducts.  Fusion, Grossmann tells us, will be cleaner than most of the alternatives.  It’s a messy business.  We hope to capture more power ourselves from tsunamis.

Update: Finally Fusion: Scientists have just reported that they are producing fusion in a footlong cylinder just five inches in diameter, and they plan on doing the same in even smaller devices.  According to the scientists, “egg-size fusion generators could someday fuel uses in spacecraft thrusters, medical treatments and scanners that search for bombs.”  See the New York Times, April 28, 2005, p. A18.  It will not, however, be  useful as an energy source.  “The central component of the device is a crystal of lithium tantalite.”  Surrounded by deuterium gas and warmed to 50F, a current of 1,000 volts was produced, setting off an ion reaction.  A UCLA team led by Dr. Seth J. Putterman has, in other words, been able to produce fusion without employing a high voltage jolt.  (5/18/05)

179Bonfires and Apocalypse Now
We’ve been rather adamant about global warming theory: it’s interesting but unproven.  We may be warming, but we may be cooling.  Further all our bonfires (i.e, burning of fossil fuels and filling the atmosphere with CO2) may cause warming, or may not. 

That said, the scientific consensus, right or wrong, generally says warming’s happening, and it’s caused by the profligate doings of men.  Our Bonfires are Leading to the Big Apocalypse.  Here we would like to point you to “responsible” opinion on the subject that is echoed at many institutions.  First, you should take a look at “The Scientific Consensus on Climate Change,” in Science Magazine (www.sciencemag.org) by Naomi Oreskes, who is in the Department of History and Science Studies Program at the University of California at San Diego-La Jolla, 3 December 2004, p. 1686.   She, as everybody else, points to the Intergovernmental Panel on Climate Change (IPCC) which says that “Most of the observed warming over the last 50 years is likely to have been due to the increase in greenhouse gas concentration.”  The Conference Board (See Executive Action, No. 107, August 2004) has recently joined with the American Association for the Advancement of Science (AAAS) to sum up the impact of climate change, its effect on business, and its connection to greenhouse gases.  Increasingly the business establishment, to include major oil companies such as British Petroleum, is buying into global warming theory and saying we must take steps to contain emissions.  To best track the corporate, Beltway, and academic consensus on global warming, we point you to the Pew Center on Global Climate Change (www.pewclimate.org).  There, too, you can find a blue chip list of multinationals that have aligned themselves behind the global warming thesis.  See www.pewclimate.org/companies_leading_the_way_belc/company_profiles.  

Finally, for those of an ironic cast of mind, we suggest reading “Jounalistic Balance as Global Warming Bias,” by Jules Boykoff and Maxwell Boykoff, where we are to understand, in general, that journalists who write fair articles admitting that there is still a smidgeon of doubt about all the global warming rhetoric are endorsing bad science, arousing doubts where none should exist, and, by implication, giving aid and comfort to the enemy.  See www.fair.org/extra/0411/global-warming.html.  In a polarized world, minority views have a tough time getting a fair hearing, even at an organization called FAIR.  Journalistic balance has become a dirty word; objectivity was thrown out with the bath water ages ago.

Update: Global-Warming Hockey Stick Nobody can put to bed the scientific debate over global warming—is it or isn’t it?  Michael Mann of the University of Pennsylvania is the originator of the “hockey stick” effect, which shows a sharp upward spike in temperatures in the 20th century.  Canadians Stephen McIntyre and Ross McKitrick pointed to errors in his calculations.  Now, “Global-Warming Sceptics Under Fire” (Wall Street Journal, October 26, 2005. p. B3) cites some studies that claim that the effect of any errors would be de minimis and, hence, not negate Mann’s contention.  They appeared in the Geophysical Research Letters, October.  See Huybers, Zorita, and also the McIntyre/McKitrick response in October.  (11/16/05)

Update: Global Warming and Cooling
So be it.  As we have made clear time after time, it’s not clear whether the world is cooling or warming, and it’s equally clear that we do not know what we have to do with whatever is happening.  We get rabid mail from those who buy into warming, those who don’t, etc.  But careful reading reveals that all sides are giving into narrow prejudice and not following the science.  This intellectual breakdown is pretty disturbing, because analysis and synthesis is what mankind brings to the table: groupthink is just lemming behavior and leads to suicidal activities.  We know nothing about the author, but we recommend, nonetheless, Robert S. Lindzen’s “There is No ‘Consensus’ on Global Warming,” Wall Street Journal, June 26, 2006, p. A14.  In general, he’s got it right: we simply do not know what’s happening to the weather and the environment.  But this in no way diminishes some other things for which we have better evidence: we are polluting the hell out of things, and this is costly for the world and us.  Here we need to change our behavior.  But the global warming people and their adversaries are simply yahoos promoting bad science.  (7/19/06)

Update: Yet Another Global Warming Twist
Despite the obduracy of various scientists on their theories that global warming, global cooling, or whatever is happening, the whole thing remains a scientific stew. We’re pretty sure things are currently getting warmer, but we don’t know whether man’s the cause. Anne Jolis in "The Other Climate Theory," Wall Street Journal, September 7, 2011, P. A13, adds yet more intellectual fuel to the fire. A substantial scientific segment, she reports, believes cosmic rays may be a key force behind warming on the earth. (9/21/11)

 

178Manure Power
One alternate energy source that one does not hear a lot about is manure.  This is odd, when you think of it, because there’s plenty of raw material to go around.  Now it’s getting more of a look see.  In Edmonton, Alberta, the Highland Feeders’ Project was slated to begin producing some power as early as October with much more to come from the 70,000 tons of manure coming off these feed lots each year.  Hot water is added to the manure: the methane it throws off is used to power generators.  Smithfield Foods, a huge pork producer, will be converting some of its pig runoff into power in both Utah and in North Carolina, a major pig factory farm state.  Electricity generated from manure disposal is far from competitive with other energy sources, and it is clear both tax and other incentives will have to be offered to fire up the manure industry.  See The Financial Times, September 2, 2004, p. 8.

177Solar Power Revisited
The technical and cost problems surrounding solar power have always been daunting.  But it is clear that its stubborn advocates have made lots of progress, and equally evident that we will be resorting to a range of alternative sources for power as our world oil supplies taper off, just as they already have in the United States.  In general, it is speculated that 2007 will be a key year for solar when costs of systems will begin to enter the range of being commercially competitive with fossil power.  

In “Another Dawn for Solar Power,” Business Week (September 6, 2004, pp. 94-95) summarizes some of the progress.  “The share of electricity produced by solar cell technology in the U.S. last year was a mere 0.07%.  There are two basic solar concepts—(a)solar-thermal where mirrors are used to gather energy that is eventually converted to steam and power generation and (b) photovoltaics where a semiconductor absorbs photons and converts them to electrons or electricity.  In Japan and Europe, which have had less cheap fossil fuels available, sales of solar energy systems have been mushrooming at 35% annually since the 1990’s.” 

Now solar is heating up in the United States.  Phoenix start-up Stirling Energy Systems is producing giant solar-dish mirrors that may generate thermal-based electricity for less than 8 cents per kilowatt hour.  Utilities in Arizona, Nevada, and California plan to test this option.  Solaiex in Los Gatos, California is producing solar panels for photovoltaic generation at $3 per watt but it is thought that the cost has to drop to $1 per watt for this to be commercially viable.  There’s some thought  that cheaper materials will have to come into play as pioneered by Siemens, now Shell, Solar Group.   

There’s also an attempt to turn roofs into power plants.  Nanosys and Nanosolar in Palo Alto and Konarka in Lowell, Massachusetts are developing liquid-plastic compounds for this application.  Many other companies and consortia are working on coating systems.

The U.S. is a laggard in the solar generation market, with Japan 4 times its size, and the Germans at least 50% bigger.  “Last year, Japan generated half of all the world’s solar power, built 44% of all new solar energy equipment, and installed five times as much new solar power capacity as the U.S.” 

Otis Port, author of the Business Week article, also notes in another issue that Bavarian Solarpark will become the world’s biggest solar-cell operation, and it is expected to generate 10 megawatts by the end of this year.  PowerLight in Berkeley, California is supplying 57,600 solar panels to it, because they track the movement of the sun, producing as much as 30% more power than other kinds of panels.  Konarka Technologies (New York Times, September  7, 2004) has acquired from Siemens the technology to print power cells on flexible sheets of plastic.  It’s thought that such cells will be cheaper and more versatile than those used in prior solar systems.  “Siemens previously announced that it had achieved a 5 percent energy conversion” using this organic solar technology, and that technology would also be marketed to recharge cellphones.

Update: Cell BoosterBill Gross of Idealab fame has gotten into the solar energy business with a 30-man start-up called Energy Innovations (www.energyinnovations.
com).  See Fortune Small Business, February 2005, pp. 38 & 40.  Photovoltaic cells are expensive, and the problem is to cut costs one way or another.  “His solution: a patented panel of mirrors called the Sunflower, which increases the amount of sun hitting each solar cell the same way turbocharging boosts power in a car engine.  …  The Sunflower, an array of 25 mirrors, tracks the sun as it moves across the sky  and aims the sunlight directly onto the solar cell….”  He expects it will cut the cost of solar power in half.  (6/15/05)

Update: Solar Chips.  T.J. Rodgers is at it again.  Chief cook and bottlewasher at Cypress Semiconductor (www.cypress.com/portal/server.pt) (NYSE: CY), he’s renowned for his maverick views on technology and on government policy affecting Silicon Valley.  And he’s always anxious to let the world know about it.  Three years ago he bought SunPower, a producer of chips used to make electricity from the sun, and he ploughed $110 million into the investment.  Its order book has $100 million in backlog for 2005, with $200 million additional already in the hopper for 2006.  All this came out of a chance meeting with Richard Swanson, who founded SunPower in 1988.  SunPower suggests its chips are better than those coming from its big rivals, Sharp and Kyocera, who are based in the solar-active Japan market, claiming 21.5% efficiency for its high-volume products.  See the Wall Street Journal, May 19, 2005, p. B4.  SunPower is doing a lot of business in both California and Germany, where government subsidies have stoked the marketplace.  (See www.sunpowercorp.com/html/.) Those who wish to take in the narcissistic Rodgers need only visit the Company’s website where they can read much about him: 

As founder, president and CEO of Cypress Semiconductor Corporation, T.J. Rodgers has written and spoken extensively on issues of importance to Cypress and the semiconductor industry, including the role of stock options in driving technology innovation and aligning employees with corporate business objectives; the continued viability of the H-1B visa program, which provides high-tech companies with an influx of skilled engineering talent, increasing the competitive advantage of U.S. technology companies; the role of outsourcing in job creation for U.S. workers; and the flaws and inconsistencies of GAAP accounting relative to semiconductor-industry-standard proforma accounting.  Rodgers has testified before Congress five times.  His treatises and opinion pieces have appeared in a wide variety of publications, including The Wall Street Journal, the New York Times, the Harvard Business Review and The San Francisco Chronicle. Click here to view T.J. Rodgers’ bio.  (6/29/05)

Update: Solar Surge “Over the last years, the shares of Evergreen Solar, DayStar Technologies, Energy Conversion Devices and Spire—all small domestic companies that make equipment for converting solar power into electricity—have more than doubled in price.”  “‘The solar market is projected to grow 35 percent a year for the next three to five years,’ said Walter V. Nasdeo, an investment bank in New York that specializes in energy companies.”  Silicon prices have soared, so tech companies in this area have benefited from using less or alternative materials as well as building more efficient chipsets.  See the New York Times, September 11, 2005, p. 5.  (10/5/05)

Update: SunPower Roars Ahead
SunPower, whose sales have soared in 2 years from $11 million to about $235 million, was slated to acquire PowerLight, which is about the same size.  “SunPower and PowerLight have collaborated on a roofing-tile product, called SunTile, which is less bulky than standard solar panels” (Wall Street Journal, November 16, 2007 and Red Herring, November 15, 2007).  “The companies will pool R&D, aiming to lower the cost of producing solar electricity by 50 percent by 2012,” says SunPower CEO.  (4/11/07)

Update: Solar Thermal Producing
64 Megawatts Last month Acciona Energy opened Nevada Solar One outside Boulder City, Nevada, using 47 miles of trough-shaped mirrors, lined up in rows.  This solar thermal installation producing 64 megawatts is many times the size of any photovoltaic plants.  “According to the Solar Energy Industries Association … solar thermal electricity costs 12 to 14 cents a kilowatt to produce, while … solar cells” add up to 18 to 40 cents a kilowatt-hour.”  “The national average retail price of electricity is about 10.5 cents a kilowatt-hour.” 

Schott, a German company, made the collector pipe for Nevada Solar One.  “Schott is developing a system that will use molten salt, rather than a liquid, to fill the pipes.  Salt could absorb the same amount of heat or more without boiling….  The current system heats the pipe to 750 degrees, helped by small electric motors that change the angle of the mirror sduring the day to face the sun.”  The next generation of solar thermal will be larger in scale and more efficient.

“An American start-up company, the Solar Turbine Group founded by engineers at” MIT, “received $130,000 from the World Bank and is testing two prototypes in Lesotho, South Africa, that use simple components, including old car parts.”  “ In production, the units will sell for $5,000 and product about 600 watts….” 

Despite prognostications that solar power will never amount to more than 3% of the U.S. energy supply—and not much more in most of the developed countries—it continues to show momentum on many fronts.  See “State and Federal Incentives Help Lure Consumers” (Wall Street Journal, February 10-11, 2007, p. B2).  “Only about one-thirtieth of 1% of all the electricity produced in the U.S. is generated by solar power,” but technological advances are drawing homeowners in.  Rebates in New Jersey, New York, Arizona, and Texas, and a federal “one-year tax credit for 30% of the cost of a residential solar-power system up to $2,000 through 2008” have been attracting consumers. “BP PLC offers a cost calculator on its Web site that uses a homeowner’s Zip code and monthly electric bill to calculate what it would cost to install a system and the rebates that are available.”

Even with the large thermal installations, solar cells installations are very much in the fast lane.  Most recently “Germany’s Q-Cells AG, the world’s second largest manufacturer of solar cells by volume, is throwing funding as well as manufacturing muscle behind” Solaria Corporation, a California start-up with a new cellular technology.  It “is developing a solar panel that uses plastic lenses to concentrate sunlight on a cell that is specially treated to use far less of the silicon that drives up solar-panel costs.”  “The scale of the long-term supply contract is considerable.”  It will provide enough solar panels to generate 1.35 gigawatts over the next 10 years; last year 1.74 gigawatts were installed worldwide according to SolarBuzz.  The long term supply contract, it is estimated, will work out to about $3.5 billion in aggregate.  “Other start-ups, such as SolFocus Inc. … are experimenting with so-called high-concentrating techniques in which lenses magnify the sunlight’s intensity by as much as 1,000 times.”  Others are playing with thin-film technologies that might eliminate silicon altogether, which is expensive and in short supply.  (10/17/07)

Update: Solar Burst and Wind Gusts
Wind energy production grew 45% last year, and solar power also surged at a similar rate, albeit from a much smaller base.  Wind-power hit a record 5.244 megawatts of capacity “that amounted to a third of all new generating capacity built in the U.S. in 2007….  General Electric Co. led the pack as the nation’s largest supplier” (Wall Street Journal, January 18, 2008, p. A6).  Solar added 300 megawatts.  “Large commercial solar installations now exceed home installations in California,” a reversal that is likely to change the face of the industry.  “More than 3,000 megawatts of giant concentrating solar projects” are to be built in the Southwest “with utilities buying the electric output.”  Lots of the equipment is imported, but now more domestic manufacturing capacity is being constructed.  New Mexico, in particular, has offered major incentives for solar companies.  (3/12/08)

Update: Forbes Solar Issue
Forbes, September 3, 2007, claims that “the new players in solar power generate golden returns.”  The truth be told, solar generation costs are still not low enough, but we are getting close.  The host of solar vignettes in this issue is testimony to the fact that solar will eventually be affordable. Applied Materials sees driving photovoltaic building costs down from current $3 or so to under $1 a watt.  It is expected to have $400 million in manufacturing contracts for solar equipment this year but is looking for $1 billion by 2009.  Miasole is pursuing thin film solar power to reduce the industry’s dependence on silicon—with a dramatic cut in costs as compared to silicon modules.  “First Solar, the most successful thin-film company, uses a compound called cadmium telluride.”  “Now Ruter’s Conery AG, in Hamburg, is the second-largest solar company in the world by revenue.  It racked up $1 billion last year….” Government subsidies and controls have stoked German solar companies and solar consumption. (4/30/08)

Update: Solar Rescue in Haiti

The band Steel Pulse and physician Paul Farmer dramatize how solar power magically has brought electricity to clinics in Haiti on this video.  Partners in Health and Solar Electric Light Fund are spearheading this effort. (08-18-10)

176. Online Newspapers Surging
Despite the steady erosion of newspaper circulation in Western developed markets, there are some surprising global pockets of strength in the print world.  China sales at 85 million were up 4%, and India at 72 million jumped by 9%.  “The number of free dailies has shot up, with a 16% increase in 2003 from a year earlier, and a 24% increase in the past five years….”  “The number of newspaper websites around the world has doubled since 1999….”   See BBC News, June 1, 2004.  The growth in online readership is staggering, and it is challenging for print editors who have clearly not mastered the new medium.

Update: Print Journalists in Decline
As one business journalist put it to us, the newspapers and particularly the magazines are retiring all their experienced writers, offering increasingly stingy buyout packages.  The print journalist is disappearing: even the kids now in the media have to write for the publication’s website while they are writing for the print edition.  Print media are in meltdown, even with their excellent cash flow, both because the readers are deserting print but also because media executives have not learned how to integrate print media with web and voice interactive options so that reader-listeners can migrate successfully from one platform to another.  “Time Inc. Cutting Almost 300 Jobs To Focus More on Web Sites,” New York Times, January 19, 2007: 

People magazine’s investments in its Web site, for example, appear to be paying off.  After the Golden Globe awards this week, people.com broke its own record for traffic in a single 24-hour period, with 39.6 million page views.  Its previous record was for Tom Cruise’s wedding in November, with 28.3 million page views. 

The 172 editorial job losses account for more than 5 percent of Time Inc.’s 3,300 editorial employees worldwide; the total 289 losses account for about 2.6 percent of the company’s 11,300-member staff. 

Time Inc. is also selling 18 of its smaller niche magazines, including Field & Stream and Parenting, which employ 530 people.  When those transactions are completed, the company’s total work force will drop to about 10,500.  It cut about 600 people last year. 

Print journalists are migrating to the freelance world and also trying to edge into online work.  The trouble with Internet journalism is that it commonly does not pay its writers.  (3/21/07)

175. Men of Conviction
The numbers of Americans behind bars and out on parole has become simply staggering.  The cost of our prisons and of so many wasted lives is as incomprehensible as that of our broken healthcare system.  Nearly 6.9 million people, or 3.2% of our population, are doing time  Four million-plus are on probation, and about 775,000 are on parole.  The number of women parolees has risen dramatically in parallel with  the rise in women involved in serious crimes.  See The New York Times, July 26, 2004, p. A10.  This would suggest that we require new ways of integrating crime doers into our economy—whether they are on the loose or are behind bars.   

A recent book, Miracle at Sing Sing, by Ralph Blumenthal, deals with one of the pioneers of more enlightened incarceration.  Lewis E. Lawes headed Sing Sing from 1919 to 1941, and he brought some real changes to the system.  ”Men who took human life and served time are the best behaved and best trusted in Sing Sing,” claimed Lawes.  Indeed, very few murderers who were paroled ever returned to prison.  See The New York Times, July 27, 2004, p. B8.  Lawes apparently showed that tough love could work out very well even with the most hardened of criminals, the very types who were sent to Sing Sing. 

The growth of prisons has changed life in America, particularly out in the rural counties where they tend to be located.  Perhaps a third of America’s counties now have at least one prison.  In a study entitled “The New Landscape of Imprisonment:  Mapping America’s Prison Expansion” published by the Urban Institute, we learn that federal and state prisons expanded from 592 in 1974 to 1023 in 2000.  Texas and Florida have led the way in building new prisons.  “The study found that the county with the largest share of its residents in prison was Concho County, Tex., with a population of just under 4,000 and 33 percent of its population in prison.”  See The New York Times, April 30, 2004, p. A15.   

The New York Times recently issued one of its periodic kneejerk editorials on how prisons across the nation have to be reclaimed from the wardens and from the unions representing prison guards entitled “Taking Back the Prisons,” August 2, 2004, p. A20.  It particularly pointed to California and the need for a more assertive state prisons authority.  It cited Judge Thelton Henderson, who put a special master in charge at Pelican Bay in order to curb abuses, and it speculated that the courts may have to step in more broadly to bring rogue prisons to heel. 

Of course, The Times is on the one hand too extreme, and on the other not extreme enough.  It’s not a question of putting band aids on our prison systems.  The real chore is to fold back into society 7 million people who have been cast onto another planet, at great cost to society and to themselves.

174Coming of Age in Arabia
As we have said previously, true advances in the Arabic and Moslem worlds will have to arise from the liberation of women, who are second class non-citizens throughout the Middle East   See our 30 October 2002 Letter from the Global Province, “Falling off the Map,” and Big Ideas, item 137, “Arabic Women’s News Service.”   Little bits of emancipation are happening, without much help from the West.  

Most recently, The Economist, June 19,2004, pp. 26-8, in “Out of the Shadows, into the World,” comments on their women’s emergence.  For instance, 55% of  Saudi Arabia’s university students are now women, and this is characteristic of  female educational progress in  the region.  Female life expectancy is rising, and birthrates are falling, allowing women more time for other activities.  In halting ways, they are making occasional progress in both the political and business spheres. 

Barbara Ehrenreich of The New York Times on July 29, 2004, p. A27 recognizes the relationship between the status of Arab women and terrorism.  “So here in one word is my new counterterrorism strategy for Kerry: feminism.”  Downtrodden women are the biggest emblem of the medieval thinking ruling Arabia.  Bringing the region into the 20th or 21st centuries would do much to end the standoff between the West and the Middle East. 

Most recently, the plight of women in Saudi Arabia and, conversely, the threat emancipated women pose to extremist male Arabs, has been dramatized by a much noticed book, Inside the Kingdom, by Carmen bin Laden, ex-wife of Osama’s older brother Yeslam.  Educated in the West as a liberal Moslem, she sweltered under the restrictions of life in Saudi Arabia.  A Swiss divorce saved her and her daughters from the stranglehold of life in the oil kingdom.

Update: Women’s Radio Station.  Women are remarkably repressed in the Arab world, no matter their economic class.  It is clear that their emancipation and education will gradually civilize the Arab states and that their betterment is the biggest hope for bringing the Middle East out of a medieval time warp into the 21st century.  Al-Mahaba is the first independent women’s radio station in Iraq.  “It was launched with funding from UNIFEM, a United Nations agency that supports women’s issues.”  Before the war there were just a handful of radio stations in Iraq; now there is just short of a 100.  See USA Today, October 7, 2005, p. 11A.  (11/30/05)

Update: Out of the ClosetWe have previously pointed out that the hope of the Moslem world is that women will emerge and take a commanding role in Moslem society, since they alone can take their societies out of the Middle Ages into the 21st century.  There are more and more sign that Saudi women are beginning to find their way. 

For example, “the election of two women to the 12-strong board of the Jeddah Chamber of Commerce was a giant leap for Saudi Arabia” (“On Their Way,” The Economist, December 3, 2005, pp. 44-45).  Women are emerging as pilots, TV announcers, and writers who engender sympathy for women’s plight in Saudi society.  As importantly, movies are now reflecting life as it is in Saudi Arabia, even making use of women actresses.  “In ‘Keif al Hal’, a big budget Arab film due out this summer, family members find themselves torn between modernity and tradition” (New York Times, April 28, 2006, p. A4).  “Movie theaters, where the sexes can mingle in the dark, have until now remained out of the question.”  “Among the film’s firsts, says Prince Walid, is the first Saudi movie actress, Hing Muhammad, who plays Duniya, Sahar’s best friend.  For years Ms. Muhammad, 25, worked on Saudi radio in soap operas, and later as a voice on cartoons.  Until now, Saudi dramas have always used women from other countries.”  Now women’s  “photographs appear in newspapers and they have their own identification cards….  Women are now training as architects and lawyers, divorce is easier and women no longer need a man to register a company.”  (9/13/06)

Update: Those Saudi Women
We don’t know how they are pulling it off but more and more bright Saudi women are climbing the top rungs of Saudi society.  In “Desert Rose,” Forbes, May 8, 2006, pp. 91-92, we learn of Nahed Taher, head of Gulf One Investment Bank.  She’s now raising a $10 billion equity fund as well as putting together mutual funds by which foreigners can invest in the volatile Saudi market.  (4/18/07)

173. Fighting Restraint of Wine Trade
As we came out of Prohibition, enabling legislation and the 21st Amendment allowed the several states to engage in interstate restraint of trade, much in violation of the original theory and wording of the Constitution.  In practice this has meant that good wine has been kept out of several states, that consumers cannot directly order wine at a reasonable price from other states, that distributors lock in artificially high prices even for lousy wines in such restraint states, and a host of other evils.  We commented on this in our letter, “Adventures in the Wine Trade: Chez Noir” (December 10, 2003).  Now the Supreme Court is getting in the act, agreeing to decide whether states can prohibit out-of-state wineries from shipping directly to consumers.  It will hear appeals from New York and Michigan, though there are more than 2 dozen cases challenging the restrictive laws of states.  New York’s Spitzer, incidentally, as usual is taking the part of those wanting to end restrictive practices.  Only $200 million of the $18 billion wine trade are direct to consumer sales, but this would vastly expand if the state laws were repealed.  See The New York Times, May 25, 2004, p. A18.

172Shutting Out Talent
William Baumol and others have (see Big Ideas 122) have warned how anti-terrorism, anti-risk measures may throw the economy in a tailspin.  The biggest risk in an age of shattering change may be behaviors that keep us from taking risks.  This is clearly showing up in immigration policies that are restricting the flow of scientists and graduate students from other lands.  “In 2001 the number of visas issued to foreign students fell by 20% from the previous year, with further falls since then.  …  60% of the research universities in America reported a decline in applications by foreign grade students between 2003 and 2004.”  Visa delays have cropped up both because they are referred to Washington for review and because the issuance procedure now requires an interview at an American consulate.  See The Economist, May 8, 2004, p. 76.

171. Totally Wired
For better or worse, futurists dream of a totally wired society where the virtual world reaches everyone, and everyone is virtual.  Either by telephone or by computer, many small spots are intensely intraconnected, and once in a while they are well wired in turn to the rest of the globe.  Some term Singapore a Smart Society because the digital impulse seems to reach into every crevice.  And we discover that places like Iceland have a high concentration of computer and cellular connections.  In Korea, digital density is so complete that it has radically changed lives, as connectivity crowds out solitude and some of the other normal facets of life.  Now the city of Chaska, the heart of Carver County in Minnesota, “is creating a Wireless Fidelity Network so vast it will blanket virtually every home, business and city office with broadband-grade bandwidth—that is, superfast access to the internet without a hard-wired connection.  …  It’s one of the first to offer Wi-Fi as a municipal service that competes with commercial broadband providers.”  See TwinCities.com (reprinted from Pioneer Press), May 26, 2004.

Update: Communities across the United States with an eye to the future are busily plotting to install community wireless so that all their citizens can patch into the Internet from any spot in town for a reasonable cost.  “Milpitas’s new wireless infrastructure, known as a mesh network, is designed to give police officers, firefighters, and building inspectors, among others, access to crucial information at data speeds ranging up to five megabytes per second.”  Other communities such as Philadelphia and Grand Haven, Michigan have announced similar projects.  “Motorola … announced its intention to acquire MeshNetworks…”  See CFO, January 2005, pp. 23-24.   

In Chaska, mentioned above, “2,000 of the town’s 7,500 homes have signed up” for the town’s mesh network, the $16 a month speedy service costing half of cable service.  See “Backwater Broadband,” Forbes, July 4, 2005, pp. 64-67.  “Mesh nets are poised to recharge the rollout of broadband in the U.S., which ranks a tepid 16th in the world with only one-third of U.S. homes getting high-speed access.”  This poor ranking largely results from the high charges from telephone and cable providers.  Minneapolis, Philadelphia, Tempe, and Madison (Wisconsin) have signed on for mesh networks.  Providers range from Motorola and Nortel to smaller Tropos Networks and Mesh Dynamics.  The telcos and cable companies are offering fierce resistance, ponying up big lobbying dollars to back bills in 18 states limiting mesh development.  Senators John McCain and Frank Lautenberg are proposing legislation to permit cities to operate their own broadband and mesh networks. 

An MIT study has looked at the pros and cons of municipal wireless, reaching no conclusion as to whether broadband should be implemented by the public or private sector. It is unclear whether the private sector has failed us.  The article, while muddy and inconclusive, does at least rehearse the arguments surrounding broadband rollout (http://itc.mit.edu/itel/docs/2004/wlehr_munibb_doc.pdf).  To keep up with the rapid-fire developments—new systems and legislatives initiatives—see MuniWireless at www.muni
wireless.com/reports.  

Our own observation would be that market-driven broadband and internet access solutions have failed us so far.  In particular, the United States ranked at or near the bottom of all countries and of the OCED countries in 2003 in the price charged to the consumer to get on the Internet.  This is particularly onerous in lagging rural counties in the U.S. where Internet access is now taken to be a major catalyst for economic and educational development in slow-growth regions and in areas that have lost major amounts of industrial jobs.  For more on technology access rankings, see http://dataranking.com/table.cgi?LG=e&TP=it02-3&RG=1m.

Update: Wireless Explosion“199 U.S. Cities and towns have plans to deploy wireless broadband networks over the next year.  Ninety-nine municipalities already have some kind of system in place” (Business Week, August 1, 2005, p. 12).  (9/28/05)

Update: Broadband Shortfall Ameica has fallen perilously behind in broadband.  In “Down to the Wire,” Thomas Bleha notes that since the turn of the century America has fallen from 4th to 13th in broadband internet usage.  Japan, South Korea, and other Asian governments have driven broadband growth, with 40-megabit connections that contrast starkly with the 1.5-meg connections in the United States.  Other small, dense countries—among them Denmark, Belgium, and Iceland—also have gotten on the broadband bandwagon, yet another fundamental that is increasing the comparative advantage of small countries in the world’s economic sweepstakes.  Some consider Bleha unduly alarmist, and note that U.S. telecom carriers are rolling out new networks and new services.  See The Economist, April 23, 2005, p. 66.  (12/28/05)

Update: Even Macedonia“On Nov. 21, Macedonian Net service provider On.Net is expected to announce plans to connect almost all 2 million residents … with a Wi-Fi network stretching across 30 cities and spanning more than 1000 square miles…  The zippy service will sell for about $18 a month, vs. the $47 consumers now pay for far slower service from the incumbent phone company….  With equipment from U.S.-based Strix Systems, On-Net has already set up … across the capital of Skopje, home of half of Macedonia’s population” (Business Week, November 28, 2005, p. 13). 

Macedonia, of course, validates the thinking of Esme Vos, the world’s chief proponent of and catalyst for municipal wireless.  See the Wall Street Journal, February 13, 2006, pp. R8 and R9.  Both in the United States and abroad, private systems offer service that is too patchwork and much too expensive, totally contradicting the concept of universal service that once animated America’s phone system before Judge Greene tore up AT&T.  Universal phone service was (a) a vital underpinning to the infrastructure that drove America when it still had a growth economy and (b) part of the tissue that produced political consensus and domestic unity.  That has now been lost.  What has not been understood is that there are certain vital public services that need to be broadly distributed, that need constant re-investment that will not occur without government prodding, and that need to avoid some of the grossly wasteful practices of short-sighted participants in the marketplace. 

“In 2003, Esme Vos, an intellectual-property attorney based in the Netherlands, became intrigued by the nascent U.S. municipal wireless movement.  So she created MuniWireless.com as a clearinghouse for information on the cities’ efforts.”  Now the site has become a crucial meeting point and database for everybody interested in universal broadband.  Glenn Fleisher, editor of WiFinNetNews.com, finds her to be the “dramaturge” of the muniwireless movement.

Vos, a native of the Phillipines, got both a B.A. and an M.A. in chemistry in the University of California system, then did Harvard Law School.  First, a securities and intellectual property lawyer, she moved to Amsterdam in 1994, working for European companies.  In addition to starting up the Muni site as an outgrowth of work in that area, she also did a ratings site of bed and breakfasts we have yet to examine. 

Still, Ms. Vos’s advocacy of municipal networks puts her on the same side as a different set of powerful industry players: equipment and chip companies like Intel Corp, Dell Inc. and Texas Instruments which gain from the sale of chips, wireless-enabled laptops and other products that use fast Internet networks. 

Not surprisingly, Intel and Tropos Network, a Wi-Fi equipment vendor based in Sunnyvale, Calif., have each contributed $35,000 to her site….  And … EarthLink Inc. … sponsored the opening night of a conference Ms. Vos organized recently in San Francisco. 

Recently, Ms. Vos has joined with a start-up media company based in Garden Park City, N.Y., called Microcast Communications Inc. to set up MuniWireless LLC.  As part of the venture, she wants to launch a quarterly magazine about wireless networks and organize more conferences. 

Those following the industry should take a look at Wi-Fi Networking News, a very diligent online trade newsletter.  (4/12/06)

Update: FreeWireles
Increasingly, cities looking for Wi-Fi are demanding a better deal for themselves and for their citizens from potential vendors.  See “Cities Shop for Lower Prices in Wi-Fi: Free,” Wall Street Journal, June 26, 2006, pp. B1 & B3.  Recently Sacramento rescinded potential deal with wireless provider MobilePro, seeking free deals such as those signed in Portland and San Francisco.  What cities are seeking are networks supported only by advertising revenues.  Some 250 cities are wired or have planned to install networks.  According to IDC, revenues in this market will swell to ½ billion by 2010.  (7/5/06)

Update: Yet More Cities
“In Anaheim, Earthlink has attached little white boxes to 1,500 traffic lights.  At the end of the month Anaheim Mayor Curt Pringle will cut a ceremonial wire, turning on these boxes and powering up America’s first big-city Wi-Fi network, which will offer residents high-speed wireless Web access across Anaheim for $22 per month.”  CEO Betty of Earthlink “hopes to repeat Anaheim across the nation….”  He will open networks in Philadelphia and New Orleans by the end of the year.  He is working on Honolulu, Minneapolis, Arlington (Va.), and San Francisco.  With Sprint and South Korea’s Sk Telecom, he is working on using Wi-Fi for cellphones, offering a service called Helio.  “Betty dreams of creating new wireless markets that don’t exist: tracking cop cars and fire trucks; reading electricity, parking and gas meters; monitoring inventory and breakdowns in soda-and-candy-vending machines.”  See “Tomorrowland,” Forbes, July 3, 2006, pp. 51-52.  (12/6/06)

170Bolts out of the Blue
Creativity, claims Ronard S. Burt, a sociologist at the University of Chicago, is all about casting a line for ideas outside your immediate network, finding the askew insight or remapping of your world in somebody else’s backyard.  As quoted in the Times, Burt claims, “The usual image of creativity is that it’s some sort of genetic gift, some heroic act….  But creativity is an import-export game.  It’s not a creation game.”   “As Mr. Burt’s research has repeatedly shown, people who reach outside their social network not only are often the first to learn about new and useful information, but they are also able to see how different kinds of groups solve similar problems.”   (See The New York Times, May 22, 2004, p. A17.)  His book on the subject is called Structural Holes, and it prods us to look into all the corners where we are not networked.  He has used a Web-based tool (www.humaxnetworks.com) to evaluate thousands of personal networks, probing their insularity and openness amongst other things.  For a bibliography on Burt, see www.lib.uchicago.edu/e/busecon/busfac/Burt.html.  

His own ideas about creativity square with our own.  In the world city in which we abide, it is hard to truly get outside the network in which we live.  For that reason, we have repeatedly urged our readers to reach into the small countries that have fallen off the map (Iceland, Finland, maybe the Eastern European countries) to find commonplaces that would be unusual here in America.

169. Losing our Edge
It’s not clear to us that you should read Thomas Friedman to understand the realpolitik of the Middle East or anywhere else.  Better than he should write about social or cultural affairs.  His recent “Losing our Edge?,” New York Times, April 22, 2004, p. A27 is reasonably penetrating, and very worrying.  He points out that the terrorist struggle is the conflict America is paying attention to, but that the “competitiveness-and-innovation struggle against India, China, Japan and their neighbors” is often being ignored by those who think about affairs of state.  He points out that for a variety of reasons, including national security measures, we are no longer as easily attracting foreign scientific talent as in days of old.  And we are not grooming enough scientists of our own, especially when you add up the millions being churned out in China and elsewhere.  Despite our excellent graduate departments, we look like we will run short of scientific and engineering talent in the future, the key to industrial innovation and our only trump card against nations with much lower costs than ours.

168The UN Is Worn Out
The 3600 people who work at UN Headquarters will be relocated in a new 35 story building one block south around 2007.  Then, if a $1.2 billion loan in the Bush budget is approved, the UN itself will be totally refurbished.  These days John M Clarkson, plan director for the redo of the UN, gives so-called “dirty tours” to show what a wreck the 1952 building has become, all to justify the big outlays coming up.  See The New York Times, April 20, 2004, P.A4.   

More is worn out at the UN  than the physical plant, however.  On a recent tour we found out that the spirit has gone out of the place.  Visitors are barred from some of the proceedings.  One section of the hall is decorated with very confrontational displays setting forth the horrors of land mines.  The guides, much less charming than in years past, roll off cookie cutter propaganda about the UN and shuttle visitors around as fast and dictatorially as they can.  The biggest plus of a tour in the late afternoon is that you will truly meet constituents from 5, 10, or 20 nations on earth, all interested and attentive, even if they are treated as supplicants rather than the citizens of the earth from which this world government derives. 

The atmosphere has become a bit negative, slightly tainted with ideology, and the UN has ceased playing its biggest card which is “hope.”   We hear that the bureaucrats of the European Union are just as divorced from the citizens who pay their salaries.  We would contrast this to a recent visit we paid to a Congressional Office in Washington, where we and our greeters were just folks.

167. Information Technology Doesn’t Matter
In May 2002, Nicholar Carr, an editor at the Harvard Business Review, came out with a shattering manifesto in HBR called “IT doesn’t matter.”  It so shook up CIOs that he has now come out with a book of the same name.  (See IT Doesn’t Matter—Business Processes Do.)  But he really doesn’t mean it.  “For commerce as a whole, Mr. Carr is insistent, IT matters very much indeed.”  His thought is that IT only becomes “revolutionary for society only when it” ceases “to be a proprietary technology, owned or used by one or two factories here and there, and instead” “an infrastructure –ubiquitous, and shared by all.”  See The Economist, April 3, 2004, p. 70.  “Since IT can no longer be a source of strategic advantage, Mr. Carr urges CIOs to spend less on their data-centres, to opt for cheaper commodity equipment wherever  possible,  to follow their rivals rather than trying to outdo them with fancy new systems, and to focus more on IT’s  vulnerabilities, from viruses to data theft, than on its opportunities.”  See his website, www.nicholasgcarr.com/
articles/matter.html, in order to gauge the tempest he has stirred up with IT Doesn’t Matter?

166Running on Empty
Are we finally there?  For the last 30 or 40 years, doomsayers have told us we are running out of oil, and we’d best deal with it.  Now comes  “Out of Gas: The End of the Age of Oil,” by physicist David Goodstein.  “Even if we substitute coal and natural gas for some of  the oil, we will start to run out by the end of the century.”  Goodstein predicts a Hubbert’s peak in world oil supplies (named after Shell geophysicist who correctly predicted the peaking out in America that has already occurred) either in this or the next decade.  Goodstein says there is no magic bullet to remedy the energy shortfall, but that we will have to make incremental advances in a number of energy areas.  He also predicts that we will not make a smooth transition out of the oil economy to whatever is coming next: We will instead have severe problems adjusting.  What’s needed, he thinks, is a commitment to across the board technological small improvements—starting now.  See review of this book in The New York Times Book Review, February 8, 2004, p. 12.  Elsewhere on  Big Ideas, you will learn that GE is methodically breaking new ground in alternate forms of energy, the sort of thinking that will be required to get us through this century.

165. Education in Cuba
Despite all its shortcomings, Castro’s Cuba has had one remarkable victory, having achieved an outstanding literacy rate by bringing education to the people.  There are tales of  lay teachers even going into the sugar fields to spread learning on the run with people at work.  From Rebecca Otto, a San Francisco speechwriter who recently visited Cuba, we learn of  the lector in tobacco factories, “a reader who’ll cover the day’s news highlights, then tackle more page from the book-of-the-moment, until it’s been read cover-to-cover.”  “We learn that these lectores are a fixture in Cuban factories, a cultural tradition imported from American tobacco makers in Tampa and Key West.”  In a recent play, “Anna in the Tropics,” actor Jimmy Smits brings Anna Karenina to “Cuban-American workers at a Florida cigar factory.”  Learning while working—an interesting idea and an antidote to the monotony of modern repetitive work.  From Otto’s unpublished essay, "Ojos Sobre Cuba" (Eyes on Cuba).

164. Washington’s  Crossing
In a little-noticed review (The New York Times Book Review, February 15, 2004, p. 13), the historian Joseph Ellis salutes a little-noticed book, Washington’s Crossing,  by David Hackett Fischer, that turns out to be a highly significant work.  Heretofore, most have conceived of the crossing and the victory at Trenton as a minor affair only significant because it kept up the morale of the Continental Army.  Fischer, says Ellis, shows that the crossing was a turning point in the war.  The Americans seemed headed for defeat, but their win eroded British troop strength (never replenished) and put them on the upswing.  Along the way, Fischer knocks down other false ideas.  Art historians said Washington could not have been standing, but, in fact, everybody was standing in the high-walled barges used to ford the Delaware.  Others claimed the Hessians were drunk and so easily subdued; apparently they were just exhausted from 24-hour duty. 

There is much about America’s Revolutionary history that we are beginning to see in another light.  For years we have thought that the Republic was put together solely through the genius of Thomas Jefferson,  John Adams, and perhaps Madison.  Now we understand that we should pay considerably more attention to other founders who are less publicized.  Washington’s aide de camp Alexander Hamilton turns out to have as much or more to do with the shape and success of America as either Jefferson or Adams.  In this respect, do take a look at Ron Chernow’s new biography, Alexander Hamilton.  We learn there that Washington and Hamilton formed a perfect team, and that they were both vital to the success of the Revolution and to the founding of the Republic.  Hamilton had much to do with its economic strength based on the full faith and credit of the federal government and its strong central government.

163The Genetic Century
Our correspondent Andrew Tanzer reviews As The Future Catches You, an accessible, convincing book that essentially says we have entered The Genetic Century.  While Enriquez has a clear political tilt, he is very thought provoking.  Apparently he has two more books in the works, and heads up his own genetics firm besides.  The technology gap between countries is, for him, the dividing line today between the rich and poor nations: 

“We are beginning to acquire direct and deliberate control over the evolution of all life forms on the planet … including ourselves,” writes Juan Enriquez in As The Future Catches You (Crown Business, 2001).  In an almost lyrical writing style, Enriquez, formerly a life sciences professor at Harvard Business School, makes a spirited case for genetics becoming the dominant language of this century.  The unraveling of DNA sequences and genetic coding will shake up industries from pharmaceuticals and medical care to food, animal husbandry and cosmetics, argues Enriquez in this important, admirably concise and accessible book. 

The Mexican-bred author demonstrates through startling statistics and examples how digital-genomics convergence, science and technology literacy and the knowledge economy are creating enormous gaps between nations (and within America).  “Science and technology allow people to multiply their productivity much faster than those who do not have the same knowledge or instruments.”  In 1750, before the Industrial Revolution, the income gap between the richest and poorest nations was 5:1; today it is 390:1, and will soon expand to 1,000:1, due to the IT and genetics revolutions.   

Enriquez is particularly devastating when comparing economic development in Latin America with that in East Asia.  Real factory wages in Mexico, which lags in education, skills and knowledge-acquisition, have been stagnant for 25 years; whereas incomes have multiplied 10-20 fold in tech-savvy Taiwan, South Korea and Singapore.  Taiwanese and South Koreans register 100 times more patents per capita than Brazilians or Mexicans.  “Many governments have yet to understand the logic of a knowledge-driven economy.  They still do not realize that in the age of information, hard work, by itself, is not enough.”  Even Chile faces a bleak future because it generates and sells little new knowledge, leaving its economy naked to volatile commodity- price movements.  

Enriquez warns that the yawning gap in the Americas is a recipe for instability:  “As the hemisphere falls further and further behind the U.S. in the knowledge economy, it gets harder to reduce income disparity, defend open markets, promote democracy, control immigration, fight guerillas, limit drugs.”

162The Mall Is Through
Paco Underhill, retailing and mall expert (he’s been through 300 or so), is just out with   Call of the Mall.  “The mall’s heyday is history,” he says.  The central problem is that malls are put together by retail developers instead of merchants, and so they ultimately lack the finesse and ambience wanted by the retail customer.  “Shoppers are deserting malls, their traffic, their packs of teens and the crummy food courts.”  See “The Controlled Culture,” Wall Street Journal, January 30, 2004, p. W9.  The mall’s lack of aesthetic feeling, diversity, and community values, however, has so shaped shopping that mindless chain retailers are now shaping their stores after the dull boxes they inhabit inside the mall.  Although the mall’s era of supremacy is drawing to a close, its sterile sameness is infecting urban and suburban spaces as merchants fail to take advantage of the uniqueness inherent in normal commercial clusters.  To learn more about Underhill and his business, go to www.envirosell.com/index.html.

Update: As it turns out, malls were probably doomed from the beginning, because economically they were built on the quicksand of a quirky tax code.  In his article “The Terrazzo Jungle” (The New Yorker, March 15, 2004, pp. 120-27), Malcolm Gladwell of “Turning Point” fame demonstrates that accelerated depreciation enticed developers into building a horde of otherwise uneconomic malls that often were not even situated next to sufficient populations of consumers.  “In 1953, before accelerated depreciation was put in place, one major regional shopping center was built in the United States.  Three years later, after the law was passed, that number was twenty-five.” 

In this article, Gladwell lays out the career of Victor Gruen, another talented émigré from Vienna, who came to the States with idealistic planning visions and was the design father of two massive mall affairs, Southdale and Northland.  Only towards the end of his career did he recognize the massive failure in which he participated.  “When, late in life, Gruen came to realize this, it was a powerfully disillusioning experience.  He revisited one of his old shopping centers, and saw all the sprawling development around it, and pronounced himself in ‘severe emotional shock.’”  “Victor Gruen invented the shopping mall in order to make America more like Vienna.  He ended up making Vienna more like America,” and the Austrians have planted their own malls near the city.  M. Jeffrey Hartwick has done a recent biography of him called Mall Maker.

161. Really Big Ideas
It’s fair to say that Channel 13 in New York really brought us really big ideas in this series that ran back in 2003, surrounding some of the superthinkers at the Institute for Advanced Study next door to Princeton University.  There’s a little here for everybody—art and life, game theory which we find particularly valuable and well done, string theory and space, and, of course, a shot of Einstein.  For bemusement, there’s a section on Great Failures as well.  See www.thirteen.org/bigideas/about.html.  To find out more about the Institute, go to www.ias.edu.  Annoyingly, despite our visits to Princeton, we never manage to get to Institute events.  Again, we would urge you to read over the segment on game theory, even if you don’t go through all the turgid material (www.thirteen.org/bigideas/ideas_game.html).  It has profound implications in the present day for economic behavior and statecraft

160Surge in American Productivity
Steve Lohr of The New York Times (February 2, 2004, p. C6) writes about the technology aspects of America’s startling productivity growth.  In general the commentators he cites says that technology alone does little, but that changed organization practices built around new technology are finally bearing big fruit.  He goes on to cite John Seely Brown, once head of Xerox’s Palo Alto Research Center, who speculates that technology is “allowing better and faster communication in the workplace, improving productivity.”   All the commentators skirt a couple of factors: scale brought about by business concentration and low wages paid to service workers.  McKinsey speculates that 10% or so of productivity gains in the U.S. have been generated by Wal-Mart alone, the king of supply-chain economics and scale retail enterprise.  Throughout the service sector, moreover, one will find a host of enterprises where workers, largely non-union, are coming up short a couple of bucks an hour, earning we think about 25% less than they should.  That said, we still do not understand productivity terribly well, particularly what we have traded off to achieve it.  An outstanding economist at one of New York’s premier investment banking houses thinks business processes and complex technology have little to do with it—in his eyes, all Americans are simply working terribly harder. 

Hal Varian in The New York Times (February 12, 2004, p. C2) ruminates about productivity and admits that economists are somewhat unsure why it rises and why it falls.  From 1948 to 1973, productivity grew at almost 3%, and then went into decline.  From 1974 to 1994, the rate of growth was halved.  Varian accepts the conventional wisdom of economists that productivity is tightly associated with a rise in the standard of living, although we are not so sure of this, since we think living standards have measurably declined during the productivity surge from 1995 onwards. 

Some chaps at Brookings, interestingly, theorize our recent productivity advances have come in services and that the uptick there has come about because of information technology applications.  “Jack E. Triplette and Barry P. Bosworth … have reached a surprising conclusion:  most of the post-1996 growth in productivity has come in services.” See www.brookings.org/views/articles/bosworth/200309.htm.  “They found that from 1995 to 2001, labor productivity in services grew at a 2.6 percent rate, outpacing the 2.3 percent rate for good-producing sectors.”  “The service industries where overall productivity did not grow were hotels, health, education and entertainment….”

159. It’s Sports: Using the Numbers
We have previously talked about the meticulous use of player performance data that teams such the Oakland Athletics and the Boston Red Sox are using to build squads that are contenders for the championship without spending the outrageous dollars that George Steinbrenner uses to capture the flag.  They pay attention, for instance, to how often a player gets on base (not his batting average) in order to decide whether a lower-rated player who can be picked up cheap is worth the investment.  In general the data driven, statistical approach has created contenders, but not winners. 

But special intellectual analysis may actually add the final 10% to a team’s performance and create a winner, when it is used to weigh strategies.  David Romer, an economist at Berkeley, did an academic paper a while back that concluded that teams punt too much.  Bill Belchik, coach of the very winning New England Patriots (Boston’s one real winner), read the paper and has since eschewed kicking in a number of situations.  Based on sundry research, he also runs ground plays where others might pass.  After a touchdown, he may forego trying for a 2-point conversion, since analysis says this may net less results.  This analytical approach may also prod coaches to think far ahead, giving up a good player today for a great player next year.  Most of the New York franchises would be stronger if they could think a couple of seasons ahead.  Find the Romer paper at http://emlab.
berkeley.edu/users/dromer/papers/nber9024.pdf.  Read about Belchik’s ways in “Incremental Analysis, With Two Yards to Go,” the New York Times, p. Wk 12, February 1, 2004.

158. Out of Vermont
It’s not clear that Vermont can incubate political candidates who can survive the jousting to be president.  But it can generate the ideas that can transform the nation, as it has fostered a culture that goes against the national grain.  Governor Dean’s campaign for president has generated Internet techniques and powerful political spontaneity that have rocked the political establishment.  They will forever change the ways campaigns are run and will ensure that precinct level community activist energy begins to have more of an impact on our national dialogue.  Out of Vermont comes Ben and Jerry’s ice cream and a host of other products that also blend in a degree of social consciousness not as apparent in the products and services originated in our major urban centers.  Just as the smaller countries of the world at the margin are ahead of the major nations in becoming information-driven (See “Falling off the Map,” October 30, 2002), our smaller states such as Oregon and Vermont are embracing health initiatives (such as shared medical decision-making) and other innovative ideas that will eventually sweep across the nation.  In this vein, see “A Short-Order Revolutionary,” The New York Times Magazine, January 11, 2004, pp. 18ff. that tells how Tod Murphy has created a diner in Vermont that almost totally uses local organic ingredients.  The author asks whether this is “the beginning of a national chain.”

157. Modeling Complex Systems
Scientists are attempting to model and understand everything from financial markets to airplane dynamics to crime to supply chains.  They are seeking to explain complex behavior “through the use of ‘agents.’  In this context, an agent is a program that acts in a self-interested manner in its dealings with numerous other agents inside a computer.”  See Economist, October 11, 2003, pp. 79-80.  Almost every agent is now enmeshed in increasingly complex systems, and this kind of analysis helps us better understand why behavior so often contradicts exactly what we would predict for an agent as we view it in a vacuum.

156. A Better Desktop
There is almost nothing that is friendly about your friendly personal computer, starting first off with its horribly engineered operating system that tries to mix, badly, too many functions in one little box.  The desktop where you start your work on your computer is not intuitive and does not help you quickly get your business done or get you rapidly to the pieces of knowledge you need to orchestrate your day.  There have been a host of attempts to provide some sort of better desktop and also to better archive the knowledge you will access to move through a business process.  In this vein it’s worth taking a look at David Gelernter’s Scopeware Vision 2.1, which will let you find what you need in a hurry.  But it’s still in its early developmental stages and will need several more iterations before it is really ready for primetime.  Take a peek at www.scopeware.com.  Read more about this in “David vs. Goliath,” Yale Alumni Magazine, November/December 2003, pp. 44-47.  Interestingly, he’s a rightwing commentator as well, has done breakthrough thinking about artificial intelligence, Java, and the Worldwide Web, and, finally, was a target of the infamous Unabomber in 1993. 

155. SuperMacs
“The brand new ‘Big Mac’ supercomputer at Virginia Tech could be the second most powerful supercomputer on the planet, according to preliminary numbers.”  Only Japan’s expensive monster Earth Simulator would then rank ahead of it.  “The machine is the first supercomputer based on Macs; it is one of the few supercomputers built entirely from off-the-shelf components and it cost a bargain-bucket price—only $5.2 million.  By comparison, most of the top 10 supercomputers cost about $40 million and up.  The Earth Simulator cost $350 million.”  See Wired News, 15 October 2003 at  www.wired.com.

Importantly, others are obtaining supercomputer strength by linking together banks of desktop PCs within company walls and tapping their unused capacity.  One example of such “Beowulf clusters” has been detailed by scientists at Penn State.  See Science Daily Magazine at http://www.sciencedaily.com/releases/2000/01/000112075104.htm

154Water Batteries
“Canadian scientists have developed a method of generating electricity from water for use in small devices, which could pave the way for products such as liquid-powered calculators and mobile phones.”  “The technology is based on the interaction between liquids and solids on a very small scale.” “Professors Daniel Kwok and Larry Kostiuk from the University of Alberta created channels similar in size to the EDL (electric double layer) and forced liquid through the channels….”  As Kostiuk says, “What we have achieved so far is to show that electrical power can be directly generated from flowing liquids in microchannels.”  See CNET, October 20, 2003, at http://news.com.com/2100-1041-5093617.html.

153. Bye, Bye Circuit Boards?
ISun engineers are experimenting with ways to do away with circuit boards, instead placing chips in close proximity to one another and allowing data to move 60 or 100 times faster than it can in present day computers.  The new technology is being developed for military applications, though Sun will try to move it into commercial applications quickly.  “The new Sun chip has tiny transmitters that are only a few microns in width.  In addition to having many more connecting points, the chip should consume far less power.  The chip’s additional channels increase the processing speed, like adding lanes to a highway….”  See John Markoff, “New Sun Microsystems Chip May Unseat the Circuit Board,” New York Times, September 22, 2003.

152Blackout 2003 Equals Blindness 1990
The story of Blackout 2003 is still ambling onto the stage, but even yet the leaders who should commit honorable hari kari evade the sword and public opprobrium.  As much as anything it’s another story of Washington breakdown, whereby deregulation has correctly unleashed a nationally interconnected power system that individual states are powerless to regulate effectively.  Fragmented regulation that is horribly weak at the national level has resulted in hopeless utilities that don’t have to repair themselves and a hopelessly outdate transmission grid that cannot deal with the long-distance power shifts it now encounters.  Our regular media does a mediocre, sporadic job on this continuing saga of infrastructure breakdown, and so we would particularly recommend extensive reading of IEEE Spectrum Online, which touches on almost every facet of this complex problem.  Start with William Sweet’s “The Blackout of 2003,” and then pour through the many other articles you can find in the index.  See www.spectrum.ieee.org/WEBONLY/special/aug03/black03.html.  

The fact is that industry officials knew Blackout 2003 was a disaster waiting to happen well back in the 90s, and, in fact, we had some sizable breakdowns along the way in that decade—all of which told us more trouble was coming.  Blackout 2003 was not just the breakdown of an errant utility in Ohio:  it was a result of the accumulated neglect of the nation’s transmission grid and the inability of powerless national officials to order commonsense practices throughout the utility industry.  Additionally, we should note, IEEE claims bright people are not going into power engineering because it is clearly not now the place to be, so it is a combination of weak regulation, lack of investment, and insufficient brain power that has given us a grid that lags as much as 30 years behind that of other developed nations. 

That said, some interesting things are happening that will eventually bode well for future generations.  In respect to the grid, “the one bright spot is in Albany, New York, where an experiment is under way to prove that, after years of frustrating disappointment, superconducting power transmission can be made to work commercially.”  In 1986 … scientists at IBM Research in Zurich discovered a new class of ceramic materials with superconducting properties at between 77K and 80K, the temperature of liquid nitrogen.  This made cooling these ‘high temperature’ superconductors simpler and cheaper.” “SuperPower’s response has been to couple the latest high-temperature superconducting materials with a new production process, in a bid to make superconducting cables cost the same as copper cables.  It hopes to achieve this by 2010.”  See Economist Technology Quarterly, p. 6ff., September 6, 2003.  For more on SuperPower, see www.igc.com/superpower; it is part of Intermagnetics, which has been at the forefront of practical, commercial applications of superconductivity resulting in viable product offerings..

Notice that a lot of superconductor activity has come out of the Northeast.  As we have previously said, the Northeast has a cluster of activities and talents that peculiarly position it to become a rebuilder of the nation’s infrastructure which needs now to be totally overhauled.

151. The Science of Food
The New York Times reports growing interest in molecular gastronomy or, as it paraphrases it, “food science.”  See “The Food Geek,” September 19, 2003, pp. W1 and W18.  Mentioned in this regard is Harold McGee, author of On Food and Cooking:  The Science and Lore of the Kitchen and Shirley Corriher, a chemist and cook(see her Cookwise:  The Secrets of Cooking Revealed).  The American Chemical Society has done a “Cooks with Chemistry” series, and “Good Eats” apparently is the Food Network’s entry in the science arena.  Several impressive articles have appeared in regional newspapers detailing how the ingredients of food come together and how they impart their flavor.  In theory at least, some think we may have more interesting eats, if not more healthy food, by studying the chemical make-up and transformation of all that we throw in the pot.

150Syndromic Surveillance Networks
In an altogether too connected world, we find ourselves fighting viruses at every turn.  That includes SARS and other conventional disease epidemics, but it also includes terrorism in all its manifestations around the world.  Whether it is disease or terrorist cells, the problem is that we are dealing with a virus that cannot be stamped out by war, or quick use of antibiotics, etc.  One must constantly sift data looking for new occurrences as flareups can occur at any time.  In the health sphere (we are not yet dealing with computer viruses or terrorism by similar sampling), anyway, officials are making a little bit of progress.  There are, according to Forbes, some 120 domestic health networks in place which look at spurts in absenteeism and spikes in other health factors to flag a potential problem, whereupon public health detectives can look for the food bugs, poisonous gases, or other factors that have sent up the warning flags.  “Syndromic surveillance aims to identify the signature of symptoms that presage an outbreak.  Networks built to track these symptoms are as sophisticated as the one in New York City that analyzes 60,000 data points daily….”  See Forbes, September 29, 2003, p. 120.  What this activity makes so clear is that policy officials in any sphere have to work hard to find what indicators tell what really is happening.  Economists now, for instance, do not perceive how troubled our economy is because they are looking at the wrong data and, in some instances, are looking at indicators that have been corrupted by adjustments that distort the data.

149. -new- Free Trade
We are always worrying about easing trade restrictions between nations, and the latest round of trade talks have just come apart at the seams, due to strong opposing views in rich and poor nations.  But we pay little attention to restraint of trade within these United States.  In contravention to our Constitution, state legislatures have erected all sorts of  barbed wire fences to prevent commerce  in innumerable areas from banking to beverages.  Certainly annoying to tasteful alluents is the fact that you cannot call a wine store in New York and California and have better vintages (at a better price) dispatched to your remote province, wherever you are.  But hope is on the way.

“In the last few months, Texas, Virginia, North Carolina, and South Carolina, in response to legislative action and court cases, have begun opening their borders to direct-to-consumer wine shipments from other states, giving wineries and online wine retailers access to millions of potential customers.”

“As a result, 26 states, including California, now allow residents to accept at least some out-of-state wine deliveries.  Depending on the outcome of other court cases, in Florida, Michigan and New York, online wine sellers could find an even larger market in the coming months.” See Bob Tedeschi, “E-Commerce Report,” New York Times, September 15, 2003, p. C7.  While online sales now comprise but a slight fraction of total wine sales, they are growing at 15 to 20% a year, while the rest of the industry is sluggish.

148. Tailwagging Education
We have long essayed as to why education in this country has gone so far downhill so fast.  Some recent comments from friend Lynn Nelson, a retired history professor out Kansas way, cut to the essence as well as any we have seen.  The rise of political correctness and other agendas which pollute the educational experience are only part of the dilemma.  More importantly, and over a much longer period of time than we might think, politicians and educational bigwigs have sandwiched everything into educational institutions that they can.  Such homogenization as made it impossible to do a few, simple things very well—the essence of the educational experience.  Here is what Lynn has to say: 

 “I agree with Bloom that Universities have lost the way, but being a historian, I see the present situation as only the most recent stage of a long process.  After the second World War, the old manual and technical high schools slowly disappeared and were swallowed up in an inchoate mass of  ‘comprehensive’ schools, while proprietary business, driving and other schools were driven out of the market by the incorporation of the teaching of such skills at the primary and secondary levels. 

The trend soon reached the post-secondary level.  First the great old schools of mines were transformed into Montana State, Colorado State and so forth.  Then the old normal schools followed into the same featureless class, and, finally, all but the greatest of the agricultural and mechanical, and technical and polytechnical schools followed suit.  To make up for the loss of such institutions—for which there was an imperative social and economic need—universities were saddled with the professional schools—education, business, journalism, social work, engineering, aerospace, and the like.  It’s not just that these one-time appendages have become the ‘star’ programs of the modern university, eating up far more than their share of scarce resources.  What has happened is that the people who run the universities—and, unfortunately, the public they serve—are no longer capable of distinguishing between training and education.” 

In other words, the tail will wag the dog.  And bad currency will drive out good currency.  And watch out for the least common denominator.  Somehow this reminds us that Yale University’s great 20th century president, A. Whitney Griswold, vowed to keep the barbarians at the gates and barred business school flackery from that great institution.  But it’s crept into the portals since, and Yale is cursed by a School of Organization and Management.  Harvard, under Lawrence Summers, is just now trying to get some control over its professional schools, which have thoroughly distorted that university.

147. "Outback Express"
See the Economist, August 9, 2003, p. 36.  The railroad from Adelaide in the south has never quite gotten past Alice Springs.  John Howard, the current conservative prime minister, is pushing it through to Darwin.  There is some thought that the project is a boondoggle, since the prime ports and cities are in the South, but then Alaska was Seward’s Folly until somebody found some oil.  Right now China is superconnecting its coastal region to its interior, and distribution in all its complex aspects is coming into its own as the driving force of the world economy post-2000.  Once again, an awful lot of wealth will be created by finding better ways of moving from a to b.  Howard will probably prove smarter than his critics.  All continents need an expanded, much more up-to-date rail system.

146. Chicago Has Got It
We hate landing at Midway, so we don’t go to Chicago much.  That said, it probably has the economists and social thinkers who have most moved us for the past few decades, quietly fueling the conservative tsunami that has swept America.  There’s Milton Friedman, of course.  And our friend Richard Posner, judge and writer, who tries to put a bottom line under all our laws and other thinking.  The New York Times Magazine, August 3, 2003, pp. 23-27 features a most amusing article (just before the Times decided to turn deadly again) called “The Probability that a Real-Estate Agent is Cheating You (and Other Riddles of Modern Life).”  Steven Levitt, an original fellow at the University of Chicago, demonstrates that a real estate agent, given his commission structure, does not have an incentive to get you the best price when you are selling your house:  The agent does best by rushing to complete a transaction, most any transaction.  He has argued that the drop is crime may relate to abortion amongst poor mothers whose unborn children would have contributed mightily to serious crime.  The fellows out in Chicago, it seems, wrestle with the same data the rest of us see and come up with conclusions that say the rest of us are paying attention to the wrong causes and the wrong effects.

Update: Becker-Posner Blog
The banditos at the University of Chicago, as we have said, are so prolific with interesting ideas that it hurts, putting the Ivy League to shame.  We have commented on this in “Quantum Thinking.”  Judge Richard Posner, of whom we have said much, and Gary Becker, of whom we will say more, are two ringleaders who really stir the pot.  Becker is as original an economist as Friedman, and Posner, more than anybody, deals with the economics of the law.  Now, as of December 2004, they have turned up with a blog that’s worth a look.  What they are accomplishing hearkens back to the beginnings of the Internet, which was put together to enable academics, especially scientists, to kick topics around together, no matter where they were seated.  On this blog are reflections on the uses of war, whence global warming, intellectual property and intellectual theft, and so on.  We ourselves are particularly interested in some comments about small countries versus large, since we think leverage has swung to smaller countries, with the end of the Cold War.  Becker believes small is beautiful now: “Mainly due to the growth of the global economy and globalized trading, the evidence is overwhelming that small nations can now do very well economically, perhaps better than larger ones.  In light of this evidence, it is surprising how many people, including economists, continue to believe that their economies will be ruined if secessionist movements succeed.”  (See www.becker-posner-blog.com.)  Now that universities have become so rigid and politically correct, it is possible that real, unfettered dialog will have to take place in virtual space.  (6/1/05)

145. The Goal of a Corporation
“In 1944 Lord Eustace Percy, in Britain, said this: ‘Here is the most urgent challenge to political invention ever offered to statesman or jurist.  The human association which in fact produces and distributes wealth, the association of workmen, managers, technicians, and directors, is not an association recognized by law.  The association which the law does recognize—the association of shareholders, creditors and directors—is incapable of production or distribution and is not expected by the law to perform these functions.  We have to give law to the real association and to withdraw meaningless privileges from the imaginary one.’”  See Charles Handy’s “What’s a Business For?” in the Harvard Business Review, December 2002, pp.49-55.  Somewhere along the way we have put Wall Street in charge of government and shunted Main Street off to one side:  It’s costing us plenty.  Stockholder capitalism is a dead end.

144. Confidence Men
For years a truism has been ringing in our head:  2/3 of all investments managers perform worse than the market averages.  If that’s so, how do they all gather in so much money from people to mismanage?  What we find is that the psychology driving people when they select their money managers has little to do with how their vendors perform.  Chief executives are equally inept in picking their investment bankers.  The emerging field of neuroeconomics bears this out in spades.  And the marketing skills of money managers has absolutely no relation to their effectiveness in handling money.  In “A Survey of Asset Management” in its July 5, 2003 issue, the Economist points out here and there that the industry has a bloated cost structure, charges outsized prices, often performs poorly, but still enjoys good future prospects.  As with many intangible service products, value is elusive and hard to define, and purchasing behavior is far from canny.

143. New Brew
In Uganda, of all places, a revolution in beer seems to be brewing.  Eagle, from SABMiller, the world’s second largest brewer, has quickly taken 30% market share, and it is not even available in Kampala, the capital, because it is in short supply.  It uses sorghum instead of barley, and avoids the long malting process by adding cheap industrial enzymes to speed along the conversion process.  The beer is cheaper, selling for 2/3 the price of other local offerings.  Probably this method will spread since it saves 10% in manufacturing costs.  Apparently the taste is not bad, but we will see.  See Economist, July 12, 2003, p. 59.  There is something of a shortage of Epuripur, a locally developed hybrid, which the Government hopes will provide a mini-boom to local farmers.  Brand manager Ian MacKintosh hopes local growers will meet the demand by end of the year. For more on this sorghum, read www.new-agri.co.uk/03-2/newsbr.html.

142. Deflation of Not?
Clearly both Japan and Germany are caught in a deflationary spiral.  Now the question is whether it will happen here or is happening already.  The stock market ratchets up a bit because Greenspan has flooded credit and cash into the system.  But we still get a host of bum company reports as well as other indications that things may still be sliding downhill.  Importantly, one should take very seriously Morgan Stanley’s chief economist Stephen Roach, who is not at all sanguine.  He thinks the core consumer price index (excluding oil and food) will go from its current 12 month gain of 1.5% to 0.5% in a year.  He sees companies working off debt and excess capacity against a background of weak demand.  Moreover, he thinks the world is too dependent on U.S. spending, demand which will not be sustained.  In this grim scenario, he likes precious metals, U.S. treasuries, consumer nondurable stocks, and companies that outsource their production to places like China.  To keep up with Roach, go to the Morgan website and use search box to find Roach at www.morganstanley.com.  To learn more about his bets on deflation, read Forbes, July 7, 2003, pp.123-24.

141. Gas Shortage
But we are not talking here about the petrol that goes into your car.  See “Natural Gas Outlook Worries Greenspan,” New York Times, June 11, 2003, p. C4.  Natural gas prices have doubled since last year, and Greenspan warns us to brace for more imports and to expand our use of nuclear power.  Apparently natural gas now fills some 23 percent of our energy needs, and it has been part of the cheap energy infrastructure and thus part of America’s competitive advantage.  We ourselves note that gas for cars is also priced well above a year ago, clearly making one wonder how strong a recovery our economy can stage.  This is still an energy profligate economy.

140. The Furtive Economy
One of our readers, inspired by our recent Global Province letter that mused about how the Mafia is able to survive and thrive in an unstable, chaotic world, wrote to remind us of the Peruvian economist Hernando DeSoto who has shown that the lack of sensible property laws in Latin America has terribly held back the members of the  peasantry, making it hard for them to even get micro loans because they do not hold clear title to their land.  They have to scheme in an underground economy because the legal framework does not permit them to advance in a straightforward and efficient way in the visible economic system.  A website deals with his ideas and the whole movement dedicated to creating  the political and legal structure under which real development can occur:  www.ild.org.pe.  You can read selections there, incidentally, from DeSoto’s book  The Mystery of Capital:  Why Capitalism Triumphs in the West and Fails Everywhere Else.  If the  poor in developing countries cannot raise capital in a reasonably efficient manner, then both they and the nations they live in are bound to slog along.  So it’s not just the mob that has had to devise tactics for dealing with a chaotic, senseless world.

Update: Housing in Mexico.  The administration of Vicente Fox in Mexico is panned by foreign journalists, probably unfairly.  Many of his ideas for change are stalled, but is it any wonder?  His predecessors at the opposition Institutional Revolutionary Party (PRI),who ruled Mexico for several lifetimes, still hold onto most of the levers of power and block reforms that would brush aside their cozy, corrupt arrangements that confer power and income on a very few.  

Nonetheless, Fox has pulled off a quiet housing revolution.  “The housing boom owes much to measures taken by Mr. Fox’s government after it came into office in 2000.”  Mr. Fox’s government has taken two key steps to expand the mortgage market.  It has turned the National Fund for Workers’ Housing into a big mortgage lender.  From 1972 to 2000, it had done just 2 million mortgages.  It has since done 1 million.  “The institute claims that it will have housed 8.1 million Mexicans … in six years.”   In addition, the Federal Mortgage Society is now providing finance for Mexico’s building societies, a big help to small building firms.  Cumulatively this is leading to a big advance in clearly titled private home ownership—a prerequisite for economic takeoff and entrepreneurship in Latin America.  If the trend holds, it will be no meager achievement for Mexico.  See The Economist, August 28, 2004, p. 33.  (1/26/05)

139. Wired South Korea
We have always known that the South Koreans liked their electronic tinker toys and have never made a note of it here.  They are the cellphone people.  Sixty five percent plus of its households have broadband connections, with nobody else even coming close.  Hong Kong is half that, and America comes in at perhaps 15%.  We would like to see even more commentary on the social and economic effects of this wiredness on Koreans.  Maybe this technology addiction explains why the North Koreans can build atomic bombs but, meanwhile, cannot feed themselves.  See Economist, April 19, 2003, Korean Survey, p. 7.

138. Decline in Globalization
“This slowdown in emerging market FDI has broadened recently into a more worrying absolute slowdown in global FDI.  Maybe this trend is just the result of world overcapacity, although it did not take place in the early 1990s when similar capacity excesses existed.  Maybe it is the global reflection of the technology and communications investment bubble and the accompanying financial collapse.” 

“Indeed, in addition to this disturbing decline in global FDI, the range of countries with strong economic performance and significant foreign investment gains seems to be narrowing.”  See Straight Talk, March 2003, from Gail Fosler, chief economist of the Conference Board.

137. Arabic Women's News Service
“Women’s eNews was working this month to begin an Arabic site aimed at Arab and Moslem women in the Middle East and the United States (www.awomensenews.org).”  Topics range from peace to divorce to conditions in sewing sweatshops.  Arabic women, as we have said, constitute the sole hope that Arabic societies will leap into the 21st century and, as such, should be  prime target for Western communication efforts.  Sundry governments, such as that of Saudi Arabia, block sites directed at women, realizing that their women are the Trojan horse that can unsettle their socially and economically antiquated societal systems.  See New York Times, April 21, 2003, p. C4.

Update:  There are small signs that some parts of the Bush bureaucracy, perhaps the vice president and possibly the Secretary of State, do partially understand that Arab women are key to peace in the Middle East.  Liz Cheney, Deputy Assistant Secretary of State and daughter of our Vice President, is running the $100 million Middle East Partnership Initiative, many programs of which “are directed at educating women, teaching them their legal rights or helping them run for office.”  “One of the first of  Ms. Cheney’s programs brought 55 Arab women who are political leaders to the United States to observe the 2002 midterm elections and to meet with Mr. Powell as well as James Carville….”  See Elizabeth Bumiller, "A Diplomatic Success, and Cheney's Daughter," New York Times, June 16, 2003, A 14.

136. Getting Happier
Sir Richard Layard delivered a memorable set of lectures on March 3,4, and 5, 2003 at the London School of Economics.  Entitled “Happiness:  Has Social Science A Clue?,”  they are more suggestive than profound.  He forages about and finds a fair number of things that are making us unhappy.  While he thinks this may, on the one hand, be the happiest point in history for those in several advanced democracies, he believes we’ve stalled or even declined over the last few years. He finds that one’s income relates to happiness up to a certain point, but has less and less to do with it thereafter.  If happiness is the goal of society, we might re-order economic and social policy to better spread the loot amongst the many and less concentrate the baubles amongst a few.  As is usually the case with social scientists, he has less an idea of how to make us happier than he does about what is dragging us down.  Most importantly, we think, he almost makes explicit that happiness is no longer clearly the goal of Western or even Anglo-Saxon society, with getting ahead and individualism ever more celebrated.  He and we believe that happiness should be fully restored to the top of the pantheon of Western values.  This will take a whole lot of philosophy and an exploration of our moral core.  These Lionel Robbins lectures can be found on the LSE website (http://cep.lse.ac.uk/events/lectures/).

Update: Home of Happiness?
The Global Province has endlessly surveyed the literature on happiness, and you will find lots of ‘happy notes’ here if you do a search.  More often than not, we find that most of the ‘happiness’ gurus actually spend their time telling us why modern man is unhappy and about all the things that are making him unhappy.  They’re much better at telling us why he’s down, rather than how he can get up.  We probably need a new flurry of Utopian writers, although, when we have read them, things don’t seem too wonderful in their paradises.  Just because it is exotic, we suppose that we should all take a trip to Bhutan, which, as we have discussed, is the Kingdom of Happiness.  But there is wide speculation as to where Nirvana is located.  We learn from the Economist, January 19, 2008, pp. 90-91, that it may be in Iceland.  Apparently, there’s a World Database of Happiness in  Rotterdam, and it has all sorts of speculations as to what makes for happy.  It’s a collection of all the scientific research on the subject.  Most likely, that’s how to kill happiness:  happiness does like to be dissected or put under the scope.  Was it Heisenberg who taught us that the very process of examining some phenomena distort them beyond recognition?

Two quasi-scientists are out with books.  Eric Weiner has a long affair called The Geography of Bliss: One Grump’s Search for the Happiest Place in the World.  Eric G. Wilson is probably more of a fun guy: his is called Against Happiness: In Praise of Melancholy.  “Mr. Weiner learns that the world’s happiest places (such as Iceland and Switzerland) are often ethnically homogeneous even if they have high suicide rates.”  Wilson, an English professor at Wake Forest University, knocks America’s obsession with happiness.  Basically both chaps are unhappy and secretly want the rest of us to get with their program for a gloomy weltanschauung.  (4/16/08)

Update: Happiness Index
The Kingdom of Bhutan continues to have a lock on the happiness market. “As Bhutan enters these uncharted political and economic waters, its leaders want to prove that they can achieve economic growth while maintaining good governance, protecting the environment and preserving an ancient culture.  To do that, they’ve decided to start calculating GNH.  It means coming up with an actual happiness index that can be tracked over time.”  (See the Wall Street Journal, March 22, 2008, p.A1)  “Happiness as defined by King Jigme Singye Wangchuck, who is credited with creating GNH and whose philosophy still guides the commission, can be found in a life that incorporates cultural traditions and respects the natural world.  Traditional Bhutanese robes are required dress for all nationals in government buildings, for instance. It is national policy for 60% of the country to be covered in forests (the actual figure is slightly above 70%).  Public smoking is also banned, although widely skirted at the many new pubs and karaoke bars in the capital, Thimphu.”  “Rather than increase the population, Bhutan wants to reduce the birth rate by almost two-thirds over the next 15 years—mainly by spreading the use of contraceptives and trying to ensure girls stay in school longer.  And rather than urbanize Bhutan, which is the size of Vermont and New Hampshire combined, the government wants to stay largely agrarian to protect the environment.” (6/18/08)

135. Smart Clothes
“MIT is leading an $80 million five-year project, partly financed by the Pentagon, to develop fabrics that think.”  “Outlast Technologies” in Colorado sells a parka that can conserve or cast off heat from skiers.  “The greatest potential seems to lie in two areas:  nanotechnology and making clothes conducive.”  “High-fashion designers—from Ermenegildo Zegna to Paul Smith and DKNY—have already started to combine fashion with electronics.  Sensatex, a New York company, will start selling its licensee Smart-Shirt commercially this year for $200.”   Other firms involved with smart fabrics include Sauquoit in Pennsylvania and Gorix in Yorkshire, England.  Warren Buffett, once burned in the textile business, has made a $579 million bid for bankrupt Burlington Industries, perhaps after its Nano-Tex, which has developed a technology to make clothes stain resistant.  See “Clever Stuff,” Economist, March 29, 2003, pp. 56-57.

134. Red Ken Succeeds
So far Ken Livingstone, Mayor of London, has gotten away with charging drivers 5 pounds a day to drive in the central district.  Traffic has been reduced by 20%, and delays have been cut almost 30%.  Londoners favor the charge, and his poll ratings are very high.  Ken is the bad boy of the Labor Party, and his elders resist his every move.  Needless to say, his success bridles both the right and the left.  See Economist, March 22 2003, p. 51.  Obviously incentive charges such as these could remedy traffic problems in many parts of the world.

Addendum If you would like another take on Red Ken and traffic, look at “The Day the Traffic Disappeared,” by Randy Kennedy in The New York Times Magazine, April 20, 2003, pp. 42-45 which really does not add that much about London but does cast the traffic jam as a worldwide metropolitan problem.  We learn that Robert Riley, once of New York’s Metropolitan Transportation Authority, has been lending Red Ken a hand, putting to work the knowledge he was not allowed to use in New York City.  The idea of a congestion charge has been around a while.  Singapore, with its own scheme for some 25 years, “has cut car ownership to 1 in 10 city residents.”

133. Power and Water
The Republic of Palau proposes to build an experimental facility that will solve two of its problems at one time.  It is using Japanese technology from Saga University to deliver both water and energy.  Cold water is pumped up from the ocean depths, causing ammonia to be released as it surges through warm waters on the surface.  The ammonia gas drives a generator.  The warm water turns to steam, which when it condenses, provides fresh water at $1 for 250 gallons, very competitive with water costs in some nations.  See New York Times, March 23, 2003, p. A9.

Update: Cold Water Energy
Despite a host of naysayers, alternate, energy projects barrel ahead, including wind, solar, tarsands, etc.  Here Peter J. Kindlmann of Yale remarks about another cold water energy initiative:

With supplies of fossil fuel now declining, John Piña Craven, former chief scientist for the Navy's Special Projects Office, has developed a plan to use cold water pumped up from the depths of the ocean to provide low-cost and environmentally sustainable power, water and food to a new development in the Marianas.  The proposal has already won $75 million from a Memphis, Tennessee, venture capital firm, and $1.5 million in federal funding.  The cold-water energy system exploits the difference in temperatures between deep-sea water—below 3,000 feet—and surface water and air.  A pipe pulls up the frigid water—39 degrees F—to the surface, where it's run through heat exchangers to produce unlimited air conditioning that costs almost nothing.  Condensation is gathered to provide freshwater for drinking and irrigation, and by directing some of the flow through a contraption Craven calls a hurricane tower, electricity is generated as well.  Once proven, Craven plans to use his energy system to nurture a small experimental Hawaiian vineyard and pineapple farm, where he says cold-water irrigation enables him to produce three crop cycles a year rather than one or two.  In the Marianas, the system will provide water and energy for 100 townhouses, a golf course, soccer fields and an athletic complex aimed at Japanese tourists.  It will also sell freshwater to hotels now relying on desalination plants.  “The oceans are the biggest solar collector on Earth, and there's enough energy in them to supply a thousand times the world's needs.  If you want to depend on nature, the oceans are the only energy source big enough to tap,” says a senior scientist at the National Oceanic and Atmospheric Administration (NOAA).

See Wired.com, June 2005 (www.wired.com/wired/archive/13.06/craven.html). (7/27/05)

Update: River Power

"A scientific process—pressure-retarded osmosis (PRO)…could supply electricity to ore than half a billion people….PRO works by funneling river water and sea water into side-by-side chambers separated by a special membrane. Since the salt content of seawater is greater than that of river water, the river water flows through the membrane in to the seawater. The pressure generated by that flow spins a turbine, which creates electricity." The question remains whether this process can scale and, if so, how widely can it be used before it does considerable environmental damage. See "High Performance Thin -Film Composite Forward Osmosis Membrane."

(08-01-12)

132. Too Much Democracy?
A number of books are now exploring the idea that the world cannot take all the democracy and free-market capitalism that is being thrust upon it.  This has to be an compelling topic now when we and others have the illusion that the U.S. is the only superpower and, as such, is capable of overwhelming the world with its theories, social mores, brandname fetishes, etc.  We ourselves are not sure the U.S. is as powerful as everybody assumes.  Nonetheless, it would help our policymakers to understand they need a greater deftness, now that our every move is under the lens, and an ability not to remake the world in our own image.

We refer readers to two of these works.  Fareed Zakaria is out with The Future of Freedom:  Illiberal Democracy at Home and Abroad.  And Amy Chua, a Yale School professor, has authored World on Fire:  How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability.  Both authors have experience of democracy and markets run awry.  Zakaria, from India, has seen in his country that liberal ideals easily get supplanted by fanatics and crooks in an immature democracy, be it the world’s largest.  Chua, of Chinese background, grew up in the Philippines and experienced firsthand the hatred felt by the majority towards an ever prosperous, perhaps too-powerful Chinese minority, a situation that is replicated several fold throughout Asia.  Interestingly Zakaria sees democracy run amok in America as having produced dysfunctional government dominated by special interests, lobbyists, and the wash of money through politics.  (See Economist, March 8, 2003, pp. 76-77.)  Chua sees the simultaneous spread of democracy and laissez-faire capitalism producing dominant minorities and, hence, a politically unstable situation.  See “A Volatile Mixture,”

Across The Board, March/April 2003, pp. 45-50.  Of course, the countries they worry about would be unstable under almost any system. The real question, we suppose, is whether a much more gradual implementation of democracy that slows down our impatient governors would be better for the world and for the countries in question.

131. Finland Power
Since our first visit, almost by accident, in the late 60s, we have been impressed with Finland at every turn.  This is a nation of tough, brainy, and worthy people.  And it very much illustrates our thesis that the important countries now, after the break-up of the Soviet Union and the end of the Cold War, are at the margins, the old giant mainstays locked in old patterns and habits of mind that have them stalemated.  Little Finland has produced Nokia, the world’s most important mobile phone company.  Like Fiskars, Nokia is a company that successfully transformed itself from a has-been to a worldbeater:  the Finns have a talent for doing this with their old enterprises.  The country produces wonderful architecture (Aalto, Saarinen, et. al.), beautiful textiles (Marimeko), stylish glassware (Ittalia), and striking dinnerware (Arabia).  But it has also had wonderful success in dealing with social problems.  Enlightened public health programs have vastly lengthened life expectancies, knocking down heart and cancer mortality over the last 30 years (See Wall Street Journal, “Finns Find a Fix for Heart Disease:  Vast Group Effort,” January 14, 2003, pp. Al and A16.).  With the lowest imprisonment rate in the European Union, with coddling, country club jails, and with very few policemen per capita, the country has also taken its crime rate down to relatively low Scandanavian levels.  See New York Times, January 2, 2003, pp. A1 and A6.  It enjoys all sorts of high rankings when compared with other OCED countries—it tops the charts on industrial and agricultural competitiveness; government is perceived as both very clean and very efficient; and the population scores very well in reading, math, and scientific literacy.  And, lest we forget the toughness part:   Before World War II really got going, the Russians took on the Finns in a Winter War, which the Russians eventually won, but at the cost of a more than a million dead.  The Finns fought like tigers.  Several nations have tried to scrape the Finns off the map—without success.  When you ride the trolleys in Helsinki, you can hear (or at least you could hear) an audio tour in four languages—Finnish, Swedish, English, and either German or Russian (we cannot quite remember).  This reminds you that Finland has a dynamic minority of Swedes clustered in the capital who provide all sorts of creative energy, leading, for instance, to an active Swedish theater in Helsinki.  

If you are the acquisitive sort, the March/April 2003 Departures from American Express has a one-page shopper on Helsinki that has a thing or two to wear out your purse (p.44).  We ourselves were a bit interested in Left, which makes custom men’s shoes using “a laser system that records 15 different measurements of customers’ feet.”  See www.leftfootcompany.com.

130. No More Barcodes
Auto-ID Centre in Cambridge, Massachusetts is hard at work trying to come up with something more resilient than bar codes to keep products in stock, trace their movement through the supply chain, and reduce theft along the way and in the stores.  See http://www.autoidcenter.org/aboutthecenter.asp.  It is beginning to phase in Radio Frequency Identification (RFID), embedding small chips in products that transmit product data to receivers.  The problem has been to come up with cheap enough chips, but the prices are coming down, now that the chip only bears an item number rather than a host of product information.  The number is transmitted to a receiver; when it is sent into the computer’s orbit, a database search reveals everything anybody ever wanted to know not just about the product class, but about the specific item that sent out the signal.  This effort, only dating back to 1999, involves some 87 companies plus MIT, Cambridge University, and Australia’s University of Adelaide. 

RFID harkens back to the 40s when it was used to distinguish Allied aircraft from those of the enemy.  Finally in the 1970s it began to migrate in a substantial way into the commercial sector.  A pioneer, as usual, has been Texas Instruments, which so often has the engineering power to bring new technologies to the edge of the marketplace, but then lacks the commercial drive to reap all the appropriate rewards.  Everybody from Fed Ex to Coca Cola have used the technology for special applications, but all sorts of barriers have inhibited its application at the consumer product level.  

A host of companies have made the plunge into the RFID arena, including Phillips Electronics in Europe and none other than Alien Technology (www.alientechnology.com), which promises to turn out cheap tags even with its high falutin name.  To get a more complete list of vendors and to follow day to day developments among all the participants, look at the RFID Journal (www.rfidjournal.com), which is doing a good job of staying on top of this meteoric field.  For popular reviews of what’s going in RFID, look at “A Radio Chip in Every Consumer Product,” New York Times, 25 February 2003 and the Economist, February 8, 2003, pp. 57-58.  Surely RFID is one of the biggest technology application stories that has emerged since 2000, yet it has been under-reported on until recent times. 

Mark Roberti, the editor of RFID Journal, founded it in March 2002, having done a long stint in Hong Kong, reporting for a raft of business publications and doing a couple of books including one on the return of Hong Kong to China and another on Jack Welch, GE, and the varying claims of what e-commerce was doing for GE.  At his last stop he was reporting on RFID for the Industry Standard, and he subsequently launched the RFID Journal, which is based in Hauppauge, New York. 

It’s been a journey from punch tags to bar codes and now radio identifiers.  Each has brought a little more rationality to inventory control, long the most wasteful part of all economic systems.  It is automatic inventory control that has so empowered Walmart, perhaps today’s biggest driver of business change in all the developed world, and much of the developing world.  As developed economies are hollowed out and manufacturing migrates offshore to developing nations, the old dominant countries have simply become distributors of goods, services, and information.  Now the problem is to do that ever more effectively.   

We would refer you to our old friend  Professor Sirkka Jarvenpaa at the University of
Texas Business School, who is wrestling with some of the strategic issues
involved with RFID deployment.  While the press has focused on the cost of chips, the implementation  issues are actually much more complex.  On the one hand, one must decide who pays for the range of  investment(s) involved here.  And then how do you spread the value reaped from RFID across the supply chain so as to achieve the
cooperation and trust necessary to make this effort achieve its promise?  Professor Jarvenpaa can be reached at Sirkka.Jarvenpaa@bus.utexas.edu.

Update: “Research company AMR Corp. estimates that early RFID implementations have shown a reduction of supply-chain costs of business of between 3% and 5% and a sales increase of 2% to 7%, because of improved inventory control.  Despite the hype, AMR has calculated RFID technology won’t be economically viable for a company’s entire supply chain until 2006.”  See Wall Street Journal, March 19, 3003, p. B4A.  We would guess that 2006 is optimistic, but, nonetheless, things are now moving along rapidly, and we will see a torrent of partial implementations.

Update: Should you have any doubts that RFID is the next wave, you should note recent announcements from both Microsoft and Walmart.  Microsoft announced in early June “that it would develop software and services that help retailers, manufacturers and distributors use radio tags to track and manage goods within stores and factories.”  “Walmart …told its top suppliers last week to have all their products ‘chipped’ or tagged with RFID nodules.”  See http://biz.yahoo.com/rc/030610/tech_microsoft_rfid_1.html.

Update: Metro AG has stolen the lead amongst big retailers in the RFID sector.  Read more about this on Agile Companies, Item 205.

128. The Lap of Luxury
As we have said many times elsewhere on the Global Province, the correct strategy for many companies during hard times is to go up market, producing much better, distinctive, products and services, rather than going to the cheap and dirty part of the market where Costco, Walmart, Home Depot, Lowe’s, Best Buy, etc. are going to win every time. Now several commentators confirm that this is a winning maneuver.  See, for instance, “Middle class busy into the lap of luxury. Sort Of,” USA Today, January 3l-February 2, 2003, pp. Al-A2.  A host of examples—leather seats and TVs on discount airline JetBlue, Coach handbags that cost only $120, and $28,000 entry level Mercedes Benzes—strive to sate the hunger of even average Americans for luxury, even though they want the good goods for middlebrow prices.  “Women, who influence 75% of buying decisions, drive urge for luxury.”  Admittedly, the best of the best still has very steep price tags.  But the interesting thing is that smart companies can still command a pretty good price for their products or services if they will lay on a little bit of extra visible quality.  Also, by the way, it is significant that USA Today ran this article:  its journalists are running more and more trend-identifying articles that the so-called heavyweight publications have not cottoned onto.  MacPaper is becoming LatteLightJournal.

Update: The New Face of Luxury

Teri Agins, in the Wall Street Journal, January 29, 2009, p.D2. predicts that luxury products are permanently headed for lower prices and stripped-down branding. In the offing are “permanent price cuts,” “more high-end bargains,” “more luxury goods made outside of Europe,” and “upscale labels” mixed “with more inexpensive items.” In the short run, we think Agins has been proven right, but we suspect that this is a loser’s strategy that will not endure. What this has led to is slightly discounted products that are of conspicuously lower quality, a losing proposition for both the producer and the consumer. This is an Emperor’s New (No) Clothes strategy. Those who want to mine the luxury mode must maintain prices and add more quality features to excel in the high-end marketplace. As bad a problem for most companies is that they do not know quality: they are so attuned to the mass market that they have no feel for the high-end. We are still a few years away from re-creating true luxury product and service. (7/7/11)

127. Pro Sports Breaking Up
It’s happening to baseball, football, basketball, and elsewhere.  You may have noticed that your kids are taking up lacrosse, golf, polo, and skydiving.  Audiences are getting smaller in the stadiums and on network TV.  The Wall Street Journal did a recent article, “NBC Sports Maps a Future Without the Big Leagues” (January 3l, 2003, pp. A1 and A6) that lays out the logical conclusion.  Without attendance and audiences, the TV networks cannot make money on pro sports.  And, once they pull their support, pro sports teams will fall apart, since they are so utterly dependent on network money.  Two pro hockey franchises, for instance, are already in bankruptcy.  Sports, incidentally, had once been the prop that kept the slowly dying TV networks in front of America.  We imagine that this means sports might become sports again instead of tired vehicles for electronic entertainment.  On cable, we should be seeing even more of the alternate sports that are pulling youngsters away from the old, standard offerings.

126. Birds Are Big
You may think that everybody is watching football, baseball, basketball, etc., but the nation is drifting away from them, and the t.v. networks are bleeding from the horrendous dollar commitments they have made to old-time sports.  People are drifting to polo, lacrosse, hockey, and gosh knows what else.  There is something about commercial overexposure that is casting a pall over traditional bread-and-butter athletics and outdoor activities.  Only recently have we learned that “Birding is the nation’s fastest-growing outdoor activity.”  See “Walk Softly, and Bring Binoculars,” Business Week, November 4, 2002, pp. 143-145.  To get started, take a peek at Sibley’s sundry guides, written by a Concord, Massachusetts fellow who has taken over the lead in the peeping sport from Roger Tory Petersen, whose guides are still well renowned.  By the way, if you need to justify your birding activity, take a look at “Spotting Patterns on the Fly:  A Conversation with Birders David Sibley and Julia Yoshida,” Harvard Business Review,

November 2002, pp. 45-49.  We learn from Sibley how to spot patterns, and from Yoshida, a doctor and amateur birder, how pattern recognition is at the heart of good medicine.  We learn that in business and in the modern world that you have to be able to deal with bits of apparently unrelated information and weave a pattern of meaning together.  We’re just glad pesticides have not done in all the birds, and that we have a few to see, whether we recognize them or not.  In poetry we talk about the shock of recognition:  in life we experience the shock of comprehension.  Anyway, good pattern-hunting to you.   Some Sibley’s and Petersen’s guides include: 

125. Bright Lights
The lighting industry is betting that light bulbs and fluorescent tubes are to go the way of the horse and buggy.  The future is in LEDS (light-emitting diodes). They’re expensive now to produce, and the technology is not yet perfected, even though they are used already in certain forms of illumination such as street lights.  But they are efficient at converting electricity to light, the costs of making them are coming down, and better white light emitters are slowly coming to the forefront.  They last for tens of thousands of hours.  Companies in the business in one way or another include Lumileds in San Jose, Nichia, GELcore, Osram, and ColorKinetics.  See the Economist, October 5, 2002, pp. 75-76.

124. Tomato Power
There’s a chance that IBI-246, derived from wild tomatoes, may replace DEET (which has safety problems), providing a natural repellant against mosquitoes, ticks, fleas, cockroaches, etc.  Michael Roe of North Carolina State University uncovered the magic ingredient.  Insect Biotechnology, Inc. (www.insectbio.com) is trying to commercialize this technology as well as developing other bioinsecticide applications.  See Business Week, July 1, 2002, p. 81.  Natural substances clearly will play a bigger part in both agribusiness and medicine, often displaying considerable efficacy with minimal adverse side effects.

123. Static
Daniel Akst has spelled out what all of us intuitively know and feel:  if we are messaged to death, we stop hearing what is coming at us.  In his “Ubiquitous Ads Devalue All Messages,” he notes that desperate advertisers are putting ads everywhere we turn—in movies, books, and  any other imaginable space.  Over the last couple of years spam has multiplied, and some of us are getting 10 junk messages on our computer to every 1 valid email we receive.  On the one hand, the advertising appears not to be working, as messages cancel each other out.  And, on the other, there are reasonable claims that the ad surfeit is degrading our culture, with wordjunk driving intelligence out of all our dialogues.  See the New York Times, June 2, 2002, p. 4.

122. The Danger of Playing It Safe
“The Danger of Playing It Safe” (Business Week, June 24, 2002, pp.64 and 66) captures a few of the ideas of economist William J. Baumol, one of which is to warn us that too restrictive an anti-terrorism regime in the United States will stifle innovation and economic vigor, both of which he takes to be the key ingredients of a nation’s real security.  As we have said elsewhere, the terrible problem of risk-averse behavior is that it is usually risky itself:  in trying to stamp out the bad, it often stamps out the good.  In the same article, we learn that “he invented the idea that service industries are plagued by 'cost disease,' as well as 'contestability'—the idea that companies whose markets are easy to enter can’t charge monopoly profits even if they have no current competition.”  As service companies come to dominate our economy, we must realize that services operate by rules we hardly understand.  Otherwise, governments would run better.

Update: Security and Insecurity Baumol has previously theorized that risk aversion, as national policy, may lead to horrible losses.  Surely some companies have sliced their throats due to a runaway penchant for secrecy.  George Rathmann headed R & D at Abbott Labs in the mid-1970s when it first undertook research on DNA applications.  “Executives were so fearful of the unproven science that they isolated the new research teams in ultra-secure labs….  Any scientist who missed a day of work had to undergo a thorough physical exam before returning to the lab….  Rathmann feared the overprotective approach would suffocate discovery.  So when venture capitalists and a scientist friend approached him in 1980 and asked him to help start a company called Applied Molecular Genetics Inc, he jumped at the opportunity.”  This all led to Epogen, which today, along with other anemia remedies, brings in $8 billion a year.  See Business Week, September 19, 2005, p. 22.  (11/2/05)

Update: Health Costs
William Baumol must be the most commonsense economist on earth.  Many times he has cautioned us about obvious things that most of us miss.  Most recently he has warned the Administration and the rest of us that healthcare costs will probably keep on rising, no matter all the hot air expended about reining them in.  “Dr Baumol and a colleague, William G. Bowden, described the cost disease in a 1986 book on the economics of the performing arts.  Their point was that some sectors of the economy are burdened by an inexorable rise in labor costs because they tend not to benefit from increased efficiency.”  New York Times, January 18, 2010, p. A12.  This truth obtains in all professional services:  even the most conscientiously run professional firms actually experience a decline in labor efficiency as they scale up:  overheads pile up as you grow larger.  Although 1/3 of all medical procedures are either useless or even harmful, we cannot get things under control if we do away with the waste.  But it’s possible to squeeze out some of costs simply by cutting down on the sources of supply.  To really get at healthcare costs, we will have to upend many aspects of the American healthcare regulatory and economic model.  Nobody is doing that now. (04-21-10)

121. Being Average—in China
We have commented before how we are burning-out children in America with too much homework, over-scheduled school days, and too many other things on their plates.  Protest groups have arisen to stem the tide, and some states have enacted small pieces of legislation to stem the insanity.  This phenomenon is not restricted to the United States.  In “A Chinese Dad in Defense of the Average Child” (New York Times, June 8, 2002), we learn that some of the same forces are at work in ever upwardly mobile China.  Zhou Hong, a literary editor in Beijing, has written “I’m Mediocre, I’m Happy,” a humorous lament about over-pressured Chinese youngsters.  Needless to say, it has not been a big seller in China, where education-to-get-ahead is taken to be the sine qua non of any worthwhile life.

120. Education for All Is Not All
Alison Wolf, professor of education at the University of London, asks Does Education Matter?, which queries the relationship between education and the economic advancement of British society.  It is clear to her that individuals with a fulsome education do better than those who don’t have one.  But she wonders if Britain is getting a good return, on the whole, on its deep, continuing investment in education.  Her questions regard not primary and secondary education, but what comes after.  The problem arises because of a perceived decline in the overall quality of university education, as scarce monies are spread across a vast, expanding pool of students, and the better universities are drained of resources.  See the Economist, June 8, 2002, p. 73.

119. Killing Fields
In World War I, 60,000 Australians died, better than 1% of a nation that then only had 5,000,000 citizens.  Almost 9,000 died at the fruitless, ill-planned battle in Gallipoli, pushed back by the Turks.  In some respects the carnage among the European nations, as bad as it was, looks small against this.  Some speculate that Australian resentment against Great Britain for the Gallipoli fiasco currently fuels the desire of many Australians to become a republic no longer allied to the British monarchy.  See the Economist, June 1, 2002, p. 81.

118. Creative Hotspots
Richard Mellon, professor of regional development at Carnegie Mellon, is just out with The Rise of the Creative Class:  And How It’s Transforming Work, Leisure, Community and Everyday Life.  He gives us a creativity top 10 list, topped by San Francisco and then followed by Austin, San Diego-Boston (tie), Seattle, Raleigh-Durham, Houston, Washington-Baltimore, New York, Dallas-Minneapolis-St. Paul (tie).  Looking at census data on the number of creative workers, high-tech activity, patent development, percentage of college-educated individuals, and the numbers of both gay and bohemian people, he finds that both creativity and wealth migrate to areas with ample concentration of these elements.  We are not at all sure he has picked the right factors or even the right areas (some of the cities he has picked have clearly peaked out), but he has gotten one thing right.  Clearly creativity and knowledge are over-concentrated in virtually every country on earth, with a few places garnering huge amounts of the talent.  The development problem is to figure out how to distribute the talent across the land and and create ferment in more places.  Further, the key planning question for even creative hotspots is to figure out more precisely what they are good at and what they are poor at.  So-called high tech areas tend to think they can tackle all sorts of technology questions.  The truth is that each one is only really suited to take on a few technology challenges.

117. Continental Enterprise
Stephen Ambrose is a wonderful yarn teller and he does a good job of stretching the railroad across the country.  “Next to winning the Civil War and abolishing slavery, building the first transcontinental railroad from Omaha, Nebraska, to Sacramento, California, was the greatest achievement of the American people in the nineteenth century.”  So read his Nothing Like It in the World:  The Men Who Built the Transcontinental Railroad 1863-1869.  We always have one or more of his books going in our household.  The truth is—whether he is writing about railroads barons, Lewis and Clark, or American fighting men in World War II—his subject is always the same:  the sheer endurance of men in unending struggle to get the job done.  In this book you feel you have done some of the work on every mile.  Ambrose has been a wonderfully successful historian, exciting the jealousy of fellow historians, a few of whom have caught him up in a little plagiarism which he has acknowledged and apologized for.  Since he is better at the struggle and process than telling of results or coming to an end, his books don’t rise to profundity:  he is, we repeat, a proud yarn teller.   

That said, we probably would have liked another book that told us more about Lincoln’s involvement with the railroad (somehow we had never known much about this) and some wide-angle thinking about the meaning of the railroad and the Civil War for the economy.  It’s fair to say that the two put together set the U.S. on the path to becoming the world’s largest economy.  The war, the railroad, and their interaction equipped a generation of leaders to deal with truly large-scale national enterprise, the like of which had not been seen before.  Ambrose’s book is wonderful, but it does not equip us to capture the total achievement it represents.

116. More Hot Stuff
In 2001, “many economic variables have been distorted favorably by the warmest winter in 106 years for the continental U.S.  These should be normalized downwards as conditions revert to regular seasonal patterns.”  (Ray DeVoe in The Devoe Report, May 8, 2002, p.4).  DeVoe might also think about continuing drought on the Eastern seaboard and in several parts of the world, as we try to understand the very strange state of economic affairs in the U.S. and abroad.  Erratic nature, political turmoil, and economic volatility seem to have resulted in performance swings in almost every large economy and in almost every large company, with certain smaller countries and certain smaller enterprises providing most of our upticks.  Especially in this atmosphere, James Surowiecki’s observation about midcaps rings very, very true (New Yorker, May 27, 2002, p. ?):  “Medium-sized companies enjoy the benefits of scale more than big ones do.”  When you are smaller, you have a place to hide when the world is giving you a hard time.

115. Manufacturing Melts Away
So far, the 2001 recession has taken manufacturing jobs down from 18.5 million in the middle of 2000 to 16.9 million today.  Typically that would rebound with new economic activity, but it is clear that a lot of the jobs won’t return as manufacturers decide to keep plants shuttered and build offshore instead.  See Business Week,  May 13, 2002, pp. 92-93.  It is getting more difficult to evaluate these same companies as their assets become brainpower, intangible processes, and intellectual capital instead of hard assets.  The DeVoe Report (April 1-5, 2002) says:  “According to Federal Reserve data tangible asset such as factories, real estate, equipment and inventories recently represented 53% of the assets of U.S. non-financial companies.  That is down substantially from the 78% level in the 1950’s.”  One must ponder a world where every company tries to become a broker that only uses somebody else’s capital. 

114. Funny Money
The Economist has come up with an original take on how excess currency and out-of-control credit is causing worldwide distortions in our financial system(s).  "The world has a new international currency:  frequent-flyer miles."  "The global stock of frequent-flyer miles may now be worth almost $500 billion."  The airlines "are issuing more miles than they can ever supply in free seats."   See The Economist, May 4, 2002, pp. 15 and 62.  In case you wondered whether the airlines are bankrupt, you now know with certainty that they are more than broke. But the real import of these somewhat whimsical articles is that the last 10 to 20 years have seen us create new financial instruments that have put our financial affairs well beyond the control of the governors of central banks or anyone else.

113. Getting Rid of Gridlock
What we have always intuitively known is that we don't have traffic jams because there are too many cars or too many people, but because we lack governors with the will to rule.  One of many antidotes to traffic snarls is "congestion pricing," where you have to pay a pretty penny if you want to drive when everybody else is.  Singapore, for instance, charges for peak access, a move that cut "downtown traffic by 40%."  Paris and London also have little congestion schemes.  Some of this variable pricing has been tried in the States.  The problem, however, is that the politicians are basically afraid to implement such schemes, afraid that car taxes in general amount to a ticket out of office and into unemployment.  See "Stop and Go," Forbes, May 13, 2002, pp. 80-81.

Addendum:  Nowhere is the solution (e.g. tolls) to traffic problems more self evident than in Great Britain.  "British roads are now by far the most congested in Europe....  British drivers spend on average twice as long as Italians each day commuting to work and a quarter more than the French."  Lord Birt is due to present a report calling for lots of road-building with tolls in town and on the open road.  The Economist (April 27, 2002, p.56) notes that the report probably will not get published, since the politicos know that the findings will spark a lot of popular resistance.  Various schemes are slipping in through the back door, such as satellite-based taxing schemes on trucks measured by distance and routes traveled.  Ken Livingstone, the flamboyant mayor of London, pledges to introduce a 5-pound daily fee for cars entering the central city.

112. Clear Away the Cobwebs
Lord Peter Bauer passed away last week on 2 May, just before he was leaving London for Washington to pick up $500,000 in prize money (Milton Friedman prize from the Cato Institute) for his pathfinding free-market development economics.  Obviously a conservative, he apparently was the sanest voice in the development field, with a healthy skepticism about most of the government-backed schemes for priming the economies of poor nations.  Since they have largely been failures, we do have to listen to him.  A Hungarian, he was another of those bright fellows who escaped Central Europe before World War II got steamy and who brought fresh thinking into British intellectual circles.  His close studies of the rubber industry in Malaya and of the West African trade gave him some detailed views of how things really worked and improved in the Third World.  In his view, development comes from trade and the free exchange of ideas with richer nations.  The best things governments can do are to enforce property rights and keep out of the way.  And he did not favor many of the idee fixes of development, such as population control and income-equalization plans.  See the Economist, May 4, 2002, p. 76.  Also Ft.com, 6 May 2002, obituary by Lord Ralph Harris.  And finally look for a book review on the Web by Amartya Sen, a Nobel prize winner and student of Bauer, whose economic views are more in line with the conventional economic development establishment.

Bauer's books include Reality and Rhetoric; The Development Frontier; and Equality, the Third World and Economic Delusion.

111. Quantum Leap
We learn in the last couple of weeks that the Japanese have overtaken IBM's supercomputers, as they periodically do.  Out there on the horizon, however, is quantum computing with molecules, and when it lands all today's supercomputers will be left in the dust.  Right now this development is making haste slowly.  The academics are still in charge, and the quantum is still a light year away.  A good popular read on the subject is "Quantum Computing with Molecules," which appeared in Scientific American in 1998.  A decent archive on the subject and the site for a joint university effort on quanta is the NMR Quantum Computation Project.  And the venerable Scout project is another wonderful resource to be found at http://scout.cs.wisc.edu/nsdl-reports/met/2002/met-020412-topicindepth.html#1.

110. Photonics 75% There
More than 10 years ago we began advising companies about the future of photonics.  With photonics, once it reaches fruition, we will be using light streams, instead of electrons, in communications, computers, and a host of other applications.  A recent article in the San Jose Mercury (March 25, 2002) has it right—“Moving Slowly Toward Light-speed Technology.”  But we are beginning to see those first photonics companies that are the maybes of this potent development.  They include Omniguide Communications, AdvR Inc., H.N. Burns Engineering Corporations, Cutting Edge Optronics, DeMaria ElectroOptics Systems, Inc., Discovery Semiconductors Inc., Foster-Miller Inc., Genex Technologies, Inc., GT Equipment Technologies Inc., Imaging Systems Technology, Integrated Sensors Inc., Laser Fare Advanced Technology Group, Sensors Unlimited Inc., and Space Photonics Inc.  To follow this industry, look at www.photonics.com.

109. Cultural Outposts
In “Showing the Flag of Culture (Or Not),” Michael Wise of the New York Times (April 14, 2002, pp. AR 1 and 31) lists some 16 cultural centers underwritten by foreign countries in New York City, and notes that the U.S. itself has not tried the same sort of thing abroad.  We would say thank goodness, thinking this trend both an ineffective and culturally diluting form of government activity.  Nonetheless, as we have noted on this site on several occasions, cultural exports ultimately are more powerful forms of unintended diplomacy than anything attempted by government, business, foundations, and the like.  The Thai government, for instance, is backing Thai restaurants abroad, which, we suspect, will eventually have big impact inside and outside Thailand.  The latest culturekampf in New York is the Austrian Cultural Forum on East 52nd Streets.  Strangely enough, as we have observed elsewhere, Austrian intellectuals have had an outsized impact outside Austria since the turn of the century, no thanks again to the Austrian government.  Cultural links all about the world thrive even when countries try to isolate themselves (such as Burma), but they flourish in spite of and not because of ministers of culture.

108. No Ceilings in Housing
It's no surprise that two bedroom flats cost around $800,000 in London and Tokyo.  But it is more remarkable that housing prices in several countries and cities have soared to better than 100% and up to 175% of personal disposal income in several countries, including Spain, Ireland, and the Netherlands.  In the U.S., prices relative to income are perilously high in San Francisco and Washington.  The Economist (March 30, 2002, p. 61) is beginning to watch housing costs more closely, understanding that the bubble there is bigger perhaps and more durable than that of stocks and the financial markets.  Housing has been a strong card for the U.S. during the current recession, but one must wonder how high is up.

107. Old Folks May Spend More
The TV networks operate on the premise that they want young viewers.  This has become the rationale, for instance, for dumping Ted Koppel and now, Lou Rukeyser.  This is because mindless buyers of ads at the ad agencies say young is good, old is ugly.  Suroweicki writes about this in "Ageism in Advertising,"  in The New Yorker, April 1, 2002, page 40.  "What's strange about the Madison Avenue youth cult is that older consumers now make up the most lucrative market in America.  People between the ages of thirty-five and sixty-four account for nearly two-thirds of consumer spending."   And what's even stranger is all the advanced developed nations are aging at a mad rate, so you cannot kiss off oldsters in any business.  Thus, at the moment, the rule is that we must kill off all interesting shows (they appeal to oldsters only) so that we may target a market that is disappearing and that the cable narrow channels are capturing anyway.

106. Grade-School Yoga
San Francisco, where so many new ideas begin--from 1-way tolls on bridges, to birth control pills (Syntex), to Silicon Valley adventurism--now is putting yoga in its schools, though there have already been other attempts to bring contemplative exercises into kids' lives.  As we have said before, schools are already burning-out kids with too much homework, insidious over-scheduling during and after the school day, and omission of recesses and proper lunch breaks.  "San Francisco's yoga-in-the-schools program was prompted by the failure of 74 percent of California public school students to meet state fitness requirements."  See the New York Times, March 24, 2002, YNE, p. 24.  There are other healthy outbreaks of school yoga in South Dakota, Los Angeles, Seattle, and elsewhere.  Obviously, yoga not only provides aerobic exercise but also stress relief for a generation inheriting the compulsive intensity of America's beleaguered adults.

105. Security Gusher
As opposed to security leak.  It's been revealed that Robert Hansen, FBI turncoat, sold key software to the Russians, and it apparently fell into Osama Bin Laden's hands.  Now we learn that it is as simple as sin to dial into the CIA's network, a security firm having breached its walls, tapping into its phone director among other things.  See "CIA details found on Google," at http://www.vnunet.com/News/1129730.  Incidentally, the Chinese  reputedly think that the USA's real Achilles heel is our computer networks.

104. Ethically Challenged
Certain places in this world produce a disproportionate amount of brainy, creative people, and we don't know exactly why.  Rumor has it that West Virginia has generated an unusual number of Rhodes Scholars, and we ourselves know a tranche of West Virginians who've left the state who simply are fountains of ideas.  Austria is like this: it produces a number of seminal thinkers -- Schumpterer, Drucker, Freud, Wittgenstein, Popper.  And then there's Peter Singer, of Austrian stock by way of Australia, and now at Princeton.  A sensitive, bright man, he's accused of every sin on earth, since he wonders whether babies who are vegetative (almost without consciousness) should be put to death, and since he contemplates a number of other moral remedies that fly in the ointments of ordinary men.  He's been called a murderer and worse, yet he asks each of us to think about living on much less so that others can live a bit better.  Probably he thinks a bit harder than most -- wrongheaded or not -- about how we deliver the greatest good to the greatest number in a world where only a small fraction of human beings really lay claim to the good life.  See the New York Times, September 5, 1999.  Singer's books include Animal Liberation and Writings on an Ethical Life.

103. Bjorn the Pincushion
Bjorn Lomborg of Denmark's University of Aarhus has been attacked by every politically correct scientist around the world.  Author of The Skeptical Environmentalist, he says that many of the alarmist scientific claims put out by Green enthusiasts around the world just don't hold water.  Some of us know that many of the Green arguments -- such as the supposed relationship between pollution and global warming -- are not very airtight, and so deserve a lot of scrutiny.  But the main importance of Lomborg is that he symbolizes the breakdown of academic discourse.  Even Nobel Prize winners have attacked his arguments with epithets instead of evidence.  Strangely, he should become a martyr in the perpetual battle for academic freedom -- a principle cast aside by lazy scholars and scientists.  For more on this see The Economist, February 2, 2002, pp. 75-76.  See also www.lomborg.org and www.economist.com/science/lomborgNature and Scientific American have devoted a host of pages to his attackers.  Also see Grist (www.gristmagazine.com/grist/books/lomborg121201.asp).  Also, look around; Grist has lots of incidental jabs at Lomborg that will equip you to dismiss him out of hand, if that's what you want to do.

102. Religious Ecstasy
Once again the Atlantic publishes a tree-shaking article.  Toby Lester's "Oh, Gods!" (February 2002, pp. 37-45) shows just how potent a force religion is worldwide in this 21st century.  David Barrett, editor of the World Christian Encyclopedia, notes that "we have identified nine thousand and nine hundred distinct religions in the world increasing by two or three religions every day."  As older established religions wither, new religions are spreading like viruses.  "One of the most remarkable changes ... is the underreported shift in the center of gravity in the Christian world ... a dramatic move from North to South.  Christianity is most vital now in Africa, Asia, and Latin America...."  New missionaries from these exotic regions are coming into developed countries to spread the Word."

101. Fuel Cells Maybe
Detroit, along with the Feds, are now putting more emphasis on fuel cells rather than gas economy.  This is, incidentally, the only way to get a handle on rising fuel costs and shrinking supplies.  See the Economist, January 12, 2002, pp. 70-71.

100. Sanyo's Soapless Washing Machine
Honing in on the environment and an aging population, washing machine inventors at Sanyo have devised a machine that works without soap.  The laundry soap people (notably Kao) have fought back and have slowed the sale of the machines saying, in effect, that these machines only do half the job.  Faced with downturns in every industry, Japanese businessmen are trying to invent their way out of their depression.  See Financial Times, January 18, 2002, p. 8.

99. Missing 99%
Read "The Deep Web: Surfacing Hidden Value" by Michael K. Bergman on Bright Planet under "Deep Planet."  Search engines only get at .03% of the Web -- or one page in 3,000.  The search engines we use, in other words, only identify some of the "surface" pages, none of the "deep" web.  Bright Planet, incidentally, helps you reach some of the databases you have never seen.

98. Mexico at 4.4%
Mexico posted the lowest rate of inflation since records began in 1968.  NAFTA is clearly bringing Mexico closer to the American orbit and stabilizing its economy.  This probably suggests, with the rise of the Euro, that all America's economies -- in South America as well -- will be knit together in one trade alliance.  Ecuador's dollarization harks at the same thing.  See The Wall Street Journal, January 10, 2002, p. A9.

97. Tricks of the Trade
We have always thought that at least half the great art in history has been produced by creatives with terribly bad eyes, the distortions in their vision producing the effects we so cherish.  My eye doctor, of course, says this is all balderdash.  However, in like manner, we find slightly loony people becoming psychiatrists and psychologists, struggling to right their brains.  And we know, of course, that all time management people, to a man and woman, are horribly disorganized and are terrible wastes of time.  By this definition, talent is a person recovering from some malady or another.

Be that as it may, we do learn in David Hockney's Secret Knowledge that much art has been produced by optical devices.  The optical lens was used in much 15th-century art; it permitted artists to reflect images onto flat surfaces and, seemingly, led to increasing realism in paintings.  At any rate, optics and prevailing light have a huge amount to do with the look of paintings.

96. From Global to Metanational
This book sets forth anew what is really a rather old, shopworn idea.  To be simplistic, what the book tells you to do, whatever your business, is to make sure that you put some listening posts in those parts of the world where all the real talent is.  Go where the action is -- to tap into the people who make great music or listen to what's hot, for instance.  As we've said before, it's as important to recognize that certain locales have generated bests in certain disciplines for decades, and that's where you really have to be:  on the Russian-Polish border for pianists, in Milan for advanced styling, in London for trendiness.  See the New York Times, December 23, 2001, Business, p. 6.

95. Naked Gentility
At every turn, we witness the decline of the gentlemen's stores, generally after their sale to a new owner.  Brooks, recently sold again for a pittance, was ruined by Marks and Spencer.  I guess Bullock and Jones is gone; it was boarded up the last time we went by it on Union Square.  Sulka, part of Vendome Luxury Group, is about to close its Madison Avenue store.  Soon every man of taste will only have memories for dress.  See the New York Times, December 21, 2001, p. A24.

94. Lonely at the Top
We have said elsewhere that our situation as king of the world is horribly expensive and geopolitically dangerous.  As the sole megapower, we in a very exposed position.  This idea is carried further in "A New Grand Strategy," an article by Benjamin Schwarz and Christopher Lane in The Atlantic (January 2002, pp. 36-42).  The authors are a little less apt in telling us how to pull back from the precipice.

93. Drug Bust
As we suggested last week, drug prices are on the way down.  Some India knock-offs, better manufactured than our own, are selling at 1/50 the price.  Now several states are going after the drug firms, even the Republican Governor of Michigan John Engler finding the price of pills out of line.  See The Wall Street Journal, December 7, 2001, pp. A1 and A13.  Health prices throughout the U.S. are inflated by the federal and insurance company system of disbursements.  But this cannot last forever.

92. Wind-Up Telephones
Mobile phones have put telephone communications into the hands of people who would have never had a good talk if the world had waited for land lines to be strung to their homes.  Now, with wind-up battery power, even more remote folks will be in touch with all the globe.  Motorola and others will soon have "wind-up" phones courtesy of Freeplay Energy Group, the company that has already pressed its technology into service for flashlights and radios.  It's thought, too, that some medical devices and military equipment might also use Freeplay's ideas.  See Financial Times, December 5, 2001, p. 12.

91. Unproductive Computers
Paul Strassmann, professor at the School of Information Warfare, and one-time information guru for the likes of Xerox and the Defense Department, says historically there has been no correlation between technology investment and corporate performance.  This will have to change, since IT budgets are too daunting for managers to neglect a payoff.  See Financial Times, December 5, 2001, FT-IT Review, p. 8. 

90. Coming January 1: Euro Money
We don't know what it all means, we just know it's big.  January will see a flood of new money -- $14.3 billion euro notes and $50.6 billion euro coins.  At first this should result in some leveling of prices in Europe with everything from newspapers, to beef, to aspirin now going for widely varying prices in each nation of Europe.  Eventually, it should promote deep economic integration -- maybe.

89. Linux Lurking
The government has pathetically failed to bring Microsoft to heel, allowing this monopoly to retard technology development and economic development.  But Linux is a tiger lurking in the woods, waiting to pounce on Big Mike, Sun, and others.  IBM is spending $1 billion developing and improving free Linux software.  Linux now has 27% of the server market versus Microsoft's 41%.  For corporate buyers, Linux nets huge savings.  See Business Week, December 10, 2001, pp. 78.  Also see Business Week, November 26, 2001, p. 14.

88. Why Middle East Commerce Stagnated
See Virginia Postrel's column reported in the International Herald Tribune, November 10-11, 2001.  Timur Kuran of the University of Southern California thinks that "Islamic partnership law and inheritance law interacted to keep Middle Eastern enterprises small, never allowing the development of corporate forms."  In the West, partnerships expanded since they were not fragmented by the death of one or more partners, while in the Middle East a covey of descendents each would get fractional ownership.  As they became big enough, they evolved into corporations.  Only in the 19th century did Middle East governments move to secular, adaptable commercial law.

87. Global Vong
More and more high-end restauranteurs are hitting all the global cites.  The latest is Jean-Georges Vongerichten, who has a flock of eateries in Manhattan, but who has now cloned his restaurants in Hong Kong, Las Vegas, the Bahamas, London, and lately Paris.  These super-chefs are spread a bit thin, so it is not uncommon  to get a put-down of Vongs abroad, where the food is not quite up to snuff.  It all reminds us of a French uncle who, when we asked what wine we should bring back to the States, said, "Bourdeauxs don't travel well."  It's even mildly depressing to think that you can't get away from global brands, so we were glad to be led far afield in Hong Kong recently by a hip Chinese fellow who knew his own mind.  See The New York Times, November 21, 2001, p. A4.

86. The Well Is Running Dry
Ever since the 1970s, we've been hearing dire predictions about energy shortages.  Now, at least, it may be for real.  By 2006, says Charles Maxwell, the dean of oil analysts, oil prices will become permanently higher.  See Business Week, November 12, 2001, p. 160.

85. Effective Philanthropy
We have just read about the whopper college gift of all time -- $650 million plus from Intel's chairman to the California Institute of Technology.  What this brings up is how does one wage useful philanthropy and not pour huge resources down a sinkhole.  In nonprofit after nonprofit, we see huge expenditures for administration, for publications that nobody reads, for projects that exacerbate the problems they are meant to solve. 

Martin Wooster's "The Donors Are In:: What Gates Can Learn from Rockefeller about Global Health" (see Philanthropy, Aug./Sept. 2001), takes a pass at this problem.  It compares and contrasts what Gates and Rockefeller did about global health.  We would probably reach somewhat different conclusions.  That is, we think big money has to go after a big infrastructure problem.  In health, this means prevention, instead of curing, on a global basis.  Anything else contributes to the spiraling expenditures for declining health now embedded in health policy in the United States.  Certainly this implies worldwide rebuilding of our public-health efforts, the biggest strategic contribution to better health, creating a much better payoff than lopsided technology expenditures.

A difficulty here is that public infrastructure building requires instincts that are directly opposed to the habits of a lifetime -- for a Gates or for a Rockefeller.  They spent huge energy destroying rather than embracing competitive organizations.  They each needed to enforce a strident point of view, a psychology so different from the fact-based objectivity that ultimately is part and parcel of meaningful philanthropy.   (Carnegie's best effort was probably endowing public libraries.)  Neither really mixed their businesses and their charities, regarding the two efforts as rather separate worlds.

Wonderful it is, however, that each has focused on health.  Each, for sure, has targeted the right sort of global problem.

84. 20% More than Dry
See "NOAA's Satellites Reveal Drought Conditions in 20 Percent of the World."  "The Worst situation was observed in Afghanistan and Pakistan where approximately 60 and 40 percent of these countries, respectively, suffered from intensive drought in 2001."  Water, or the lack of it, will be center stage politically and financially over the next decade.

83. Jim Clark's Failures
Now it is the right time to read Michael Lewis's The New New Thing, which seems to be an amusing epigraph on Jim Clark's failures.  His Silicon Graphics, Netscape, and Healtheon ventures plus a few other ventures have really all turned out to be failures that nonetheless lined his pockets.  The most calamitous was his computer-controlled Hyperion, a white whale of a boat that got the better of Ahab Clark.  One must conclude that Clark, and several other Valley boys, were actually much, much better at hype than Hyperion: they were relentlessly adroit at tulipmania, getting transient enterprises insanely valued by manipulation of compliant investment banking and media communities.  Clark is not an engineer but a promoter of virtual Florida real estate.  Where, we must ask, is the beef?

82. Free-Market Medicine
As we know, health costs continue to skyrocket due to guild practices, government fiddling, insurance company transaction costs, and sundry price-fixing.  But better medicine at the best cost is often available just across the border.  For instance, a U.S. citizen would best go to Canada to fix a hernia.  In England you often can't get the operation you need done, given the typical waiting periods for surgery there.  Now the National Health Service will be paying for Brits to go to continental Europe for immediate help at much lower prices.  A hip replacement, for instance, will cost 20% less in Belgium than in Britain.  See "Medicine sans Frontieres," The Economist, September 7, 2001, pp. 48-49.

81. Extinguishing Burn-Out
From time to time we will publish past newsletters, better known as "News from the Global Province."  Although this particular thought is exactly one year old this week (September 4, 2000), it still resonates--for all we know, it may be even more timely this week than a year ago.

What do you think about burn-out? Had any lately?

I meet it coming around every corner. It is totally indiscriminate, striking old and young, rich and poor, urban wastrels and country cousins, businessmen and bureaucrats and bookish academics.

Twenty or thirty years ago I gave a speech in Pensacola, Florida. On the dais with me was a local prophet who disgorged volumes about stress. “Gosh,” I said to myself, “We are really in trouble if stress has emigrated to Pensacola.”  Well, now I know. It has. It is an even more pervasive epidemic than Lyme Disease, asthma, or obesity. If Will Rogers were alive today, we would be calling him Worry Rogers.

Anything you can think of causes stress. That’s what Hans Selye taught us about the stress syndrome. It’s the disease with a 1,000 fathers: it’s the disease with a billion children worldwide all suffering from burn-out.

But I would cast a vote for two major catalysts. Our political leaders—from Bubba [Clinton] on down—are pretty dysfunctional, and they have been able to spread stress in their wake.  At the same time Technology with a big T has been more disruptive than Clayton knows: we have not been able to successfully integrate new, alien technologies into our lives. We call them “friendly,” but they are not.

Enough, however, about burn-out and its causes. That kind of discussion only increases our pain and stress.

What to do? I talked with my house painter this morning and we agreed it helps to put more craft into your job. For at least ten years we have been doing a lot more, but we have not been doing it better. Doing less and doing it terribly well breeds a sense of purpose which, marvelously, causes us to levitate and rise above the tension.

Secondly, some of us think we need to make some big moves. Ever since the end of the Cold War the nation has been engaged in an exercise in incrementalism, even on the business front. The last administration diligently fertilized the weeds, and we've yet to see how the present administration will deal with these nuisances. We need to do a few big ideas.

That’s why in Leading the Revolution, Gary Hamel has come out for big-time innovation. He says that the value of process improvement has pretty much run its course, and it is time for real originality.

...   In short, we think good business and good government now consist of coming up with a clear, big idea, expressing it vividly and simply, and acting on it with dispatch.

80. Nothing Is as It Was
Crime is dropping.  People are turning out the lights in California: increasing the cost of electricity does promote conservation.  And mass transit is beginning to displace the auto, at least in New York City.  "In the 1990s, for the first time since before World War II, the growth in public transit readership outstripped the growth in auto use in the five boroughs....  New York City Transit now carries 1.2 billion passengers a year, more than the yearly ridership for Chicago, Washington, Boston, Philadelphia, and Los Angeles combined."  See The New York Times, August 8, 2001, p. A17.  Long term, it would seem, the masses will act rationally, despite the mistakes of our governors.  Mass transit in New York City is a compelling strategic advantage of that metropolitan area.  For the full report, go to http://www.schallerconsult.com/pub/modeshft.htm.

79. Techno-Towns
Led by Ann Markusen, researchers at the University of Minnesota have looked at metropolitan technology development across the United States, with some surprising results.  Based on a broad definition of high technology employment, they find tremendous high-tech strength in Chicago, Washington, New York, and Philadelphia, even if these 2nd cities lack well-known hotspots such as Silicon Valley or Rt. 128.  Most importantly, one can surmise from this study that the more diversified the technology base of a region, the better it will weather recession.  And, secondly, regions which better understand their skills and industry concentrations may hope to forge better long-term development policies.  See "High-Tech and I-Tech," www.hhh.umn.edu/gpo/degrees/murp/htmetros.pdf.

78. Absent and Unaccounted For
As a rule of thumb, we have always said that employee benefits add at least a third to each company's wage bills.  But the real number may be even higher.  An article in View Point, "The Cost of Absence: A Survey of Employers' Time-Off and Disability Programs," focuses us yet more on the gigantic costs.  Employers bemoan healthcare benefits--estimated to be $4,430 per employee.  But a Mercer/Marsh McLennan study estimates the costs at $5,720 per employee--and that's only direct costs.  Indirect costs (temporary employees, etc.) are thought to add another 10 to 50 percent, but lost revenue and lost productivity may ratchet this up to 100 to 200 percent of direct costs.  Whatever the actual number, the missing-in-action cost the economy stupendous dollars.  See View Point (The Marsh and McLennan Companies Journal), November 1, 2000, pp. 1-7.

77. Global Lockstep
Most of the pundits and economists now predict a U.S. recovery from our non-recession, looking at U.S. interest-rate cuts plus some other U.S. indicators.  And they may be right.  But the troubling thing is that all the economies outside the U.S.--Singapore, Japan, Europe, wherever--are quivering.  Even China is beginning to soften.  Ken Fisher, a West Coast investment advisor, has noticed this.  "Except for Australia, the big markets around the globe are sick."  With everybody slumping, we will probably get a small upturn in our own markets and then a renewed downturn later on.  See "The Lone Ranger," Forbes, July 23, 2001, p. 162.

76. Better Code
"Extreme Programming," or "XP," has become the latest attempt to promote better, faster-built software programs.  A leader is Kent Beck, who has written a book about it called Extreme Programming Explained.  At its core, extreme programming emphasizes intimate collaboration among software writers, contrary to traditional practice.  See Forbes, July 9, 2001, p. 142.  Also see http://ootips.org/xp.html.

75. Foolproof Cryptography
Probably not, but maybe.  Los Alamos scientists are putting quantum mechanics to work for encoding.  By sharing strings of photons, message senders will be able to create unbreakable keys.  Some other technologies, such as hyper-encryption, as developed by two researchers at Harvard University, also are promising.  In every instance, the techniques generate so much information that a decoder is at a total loss.  This reminds us that in the days when we used to fool with classified materials, we suggested that everything be classified so that an interloper would never be able to find the needle in the haystacks.  See The Economist, June 23, 2001, pp. 75-76.

74. Capital Makes Capital
Hernando de Soto of Peru says we could make the poor a whole lot less poor if ownership of their plots was correctly sanctioned under the law so that they could borrow to improve their lot.  His ideas, spreading through Latin America and into some other regions (such as Egypt), are now reaching the popular domain.  de Soto lends substance to an old idea--a rational, stable political regime is the prerequisite for true prosperity.   Given the world's growing cleavage between the rich and the poor, both rich and poor nations as well as the rich and the poor in the well-off nations, de Soto's ideas merit wider currency and acceptance.  See "The Poor Man's Capitalist," New York Times Sunday Magazine, July 1, 2001, p. 44-47.

73. Civil Virginia
As we've said before, kids are over-scheduled, to their great detriment, during and after school.  Their lunches are not long enough; they have too many periods and subjects; often they go without recess.  But one state, at least, has woken to reality.  "Last year, Virginia became the first state to make recess a daily requirement."  We always knew that Virginia was more civil than the rest of the states; still, we'd like to go further.  We want to see two recesses and hour lunch mandated.  A professor at Hofstra University in New York, Richard Clements, heads the American Association for the Child's Right to Play, a group leading the charge on this subject.   Almost a century ago our industrial psychologists learned that operators and others do better in every way if they takes breaks.  See The Economist, June 18th, 2001, p. 35.  See also entry 44 below.

72. Cheap Gas
See www.gaspricewatch.com.  Ultimately, the Internet is a very efficient auction mechanism.  Gaspricewatch.com shows just what the Internet can do to prices, leading you straight away to the cheapest vendor in your neighborhood.  Plug in your zip code, and you can find the cheapest gas station in five, ten, or twenty mile distances from your location.  The site depends on a host of observers, essentially a corps of volunteer consumers.  It also keeps track of heating prices.  One warning: we're not sure how often the site is updated, so don't always take it as the final word on fuel.

71. War Is Back
A couple of generations back, the trend-setting firm Inferential Focus, having spotted the revival of tanks and other military artifacts in the children's toy market, advised its Wall Street clients that war was back.  We chatted with a partner there the other day, and he recently had seen some GI Joes in store windows along New York's busiest streets.   The rampant revival of World War II (from Brokaw to Pearl Harbor) and the renewed soul-searching about Vietnam thirty years after the fact should give heart to aerospace analysts.  The defense companies are going to do a little business, and our national debt ratios will probably get into more trouble.  The End of the Cold War (and the End of History) looks very short-lived.

70. The Nineties Were a Bust
This is a minority point of view, but if you were a minority you probably did not do well during the nineties, a decade when income disparity only widened throughout the country.   But, says James W. Paulsen of Wells Capital Management, the whole economy may not have done very well either.  "Paulsen advances the provocative theory that the miracles of the '90s ... were actually the result of sluggish growth in U.S. and global demand.  What enabled U.S. businesses to thrive was the energetic adoption of a number of cost-cutting strategies that went straight to the bottom line."  See Business Week, June 18, 2001, p. 26.   "In the U.S., nominal GDP grew at a mere 5.54% annual rate, its slowest pace since the Depression...."  What we had--we've said before--is stock-market capitalism, and it is still questionable as to when we will adopt real growth policies.

69. Softwar
One-time guitarist for the Doobie Brothers and Steely Dan, Jeffrey Baxter is now a guitarist plus since becoming a consultant at the Pentagon.  He's impressed with "what Joseph Nye called 'soft power' and the idea that the tremendous influence the United States has in the world is not only due to its military prowess but to its cultural prowess--Elvis Presley, blue jeans and 'Baywatch.'  If that's true, you could make the argument that artistic freedom is a national security issue."  See The New York Times, Sunday Magazine, June 10, 2001, p. 31.

68. Shifting the Battleground
Who knows whether he can get it done, but Arnold Rumsfeld really does want to forge a post-Cold War defense, to wit "an increase in small, ultra-high-tech, maneuverable weapons ... [which represents] a further shift in the Pentagon's focus away from Europe toward Asia."  See "Lexington Rumsfeld's Defence," The Economist. May 26, 2001, p. 34.

67. Inequality Works
Americans are working more, Europeans less.  Economists at the National Bureau of Economic Research argue that "America's greater pay disparity creates incentives for employees to work harder.  ...  Americans work longer hours mainly because of the lure of big wage gains."  See "Why Americans Work So Hard," Business Week, June 11, 2001, p. 34.

66. Wasted Largesse
Companies, it seems, do as badly at giving away money as governments.  Because of a dustup in Nigeria, Shell Oil poured $150 million and hordes of experts into the countryside starting in 1998.  Three years later, it hired a consultant to tell it that it had been a failure.  "Having looked at 82 of the 408 projects on Shell's books ... the team concluded that less than a third have been successful."  "Although it has tried, it is still essentially buying off the locals with gifts...."   Sounds like government stuff to us.  See Economist, May 12, 2001, p. 52.

65. Ending Skylock
In "Freedom in the Skies," James Fallows writes most provocatively of the effort to develop economic, safe commuter aircraft that could dwarf a lot of traffic out of the fifty or so jammed major airports in the nation onto the nation's 13,000 or so other "landing facilities."  Not surprisingly, this revolution in air transport is being fueled by money and imagination at NASA.  Many of our most important transformative events get their impetus from worthy civil servants.  The Internet, for instance, was sired by DARPA.  In this article, we learn of two fascinating start-ups, Cirrus Design Corporation and Eclipse Aviation.  While Fellows does not get into the economic consequences of dispersed air traffic, it is clear that such a development would (a) remedy the over-concentration now occurring among the airlines and (b) help generate new economic development in several backwaters left to die by our governors in Washington.

Update: It is still not clear which small jet designer is going to win the battle to provide the little jet plane that will serve as a commuter craft between America’s small airports.  As Fallows and others have made clear, we have to get the people out of our megaports and get them into the easygoing small strips that you can still find at Laredo and all the little communities around the United States.  In other words, we want to stay out of anything that has International in its name.  Rick Karlgaard, publisher of Forbes, has also caught hold of this idea and is betting on the A700 from Adam Aircraft Industries of Englewood, Colorado.  He says, “The $1.9 million Adam 700 will beat Eclipse and Cessna to the cheap-yet market by two years.”  See Forbes, September 15, 2003, p. 35.  He thinks the Eclipse will be too late, and the $2.7 million Cessna Mustang will be both tardy and expensive.  Karlgaard tells us Adams got there through rapid prototyping, carbon fiber design, mostly off-the-shelf parts, and a breakneck working schedule.  Well, we don’t know who is going to win:  we suspect everybody will get a piece of the action.  We are just sure it is going to happen.

Update: We have avidly followed the race to build cheap, short-hop jets that will keep us out of hub airports, instead allowing us to land at that modest airport in Grand Junction, Wilmington, or Tucumcari.  Rich Karlgaard, publisher of Forbes, follows the chase just as closely, for he also knows that it will change the way we get around America and make much more out of small, forgotten towns that still should be centers of commerce.  “Last month the Eclipse 500, a four-passenger jet, was due to take test flight with its new Pratt & Whitney 610F engines….  Certification and delivery of the Eclipse 500 is now expected in 2006.”  It will cost about $1.3 million.  Karlgaard notes that its new manufacturing process called “friction-stir welding” will cut man-hours put into the plane from 3,000 to about 700.  Because of the lower costs, Eclipse only needs to sell 500 airplanes a year to break even.  Eclipse thinks it will open whole new market segments.  “Eclipse now has 1,400 orders.”   See “Cheap Jet Update,” Forbes, January 10, 2005, p. 31.  Of course, caveat emptor: we have been talking about the 500 since 2002; see our Global Province Letter of July 22, 2002.  (1/26/05)

Update:  Ups and Downs for Small Planes

The small commuter plane market has had its bumps, Eclipse having gone through a tumultuous bankruptcy yet laboring on under new management.  But it’s interesting that small vehicles are displacing  the blunderbuses in several areas of our life.:  GM and Ford are both at work developing more small car capacity.  And lately, rugged small aircraft are popping up for the military market.  “Air Tractor Inc., of Olney, Texas, is displaying its prototype Air Truck AT-802U, which is essentially a two-seat combat-ready crop-duster with weapons and advanced electronics.”  See “Lower-Cost Planes Win New Attention,” Wall Street Journal, June 16, 2009, p.B3.  L-3 Communications Holdings Inc. and Alliant Techsystems Inc. are also beginning to show buyers “unarmed turboprop surveillance planes.”  In general, there is a new for facile, low-cost vehicles in a number of settings. (08-26-09)

Update: Life after Death

Eclipse, thought to be bankrupt, has risen from the dead. One of its big investors has taken it over, basing it in Charleston, South Carolina, though production is still situated in Albuquerque. Eclipse Aviation blew a billion dollars on development of its snazzy small plane: the plane was a success but the business was a disaster.

"This time around, the company is aiming for a more realistic price tag of $2.69 million per plane and has teamed up with what it considers a more stable group of suppliers, hoping to win back the loyalty of the jets' pilots and owners."

"Sikorsky is both investor and supplier to Eclipse, and starting next year, PZL Mielec, a Sikorsky unit in Poland, will begin making the bodies, tails and wings of the jets, which will then be assembled in Albuquerque. Rather than having five companies building the body of each jet, its new Polish supplier will supply those parts from nose to tail and wingtip to wingtip—an operating model that greatly simplifies the building of the aircraft."

"Today, Mr. Holland is less concerned with opening new markets, like air taxis, than offering a more economical way to get around for existing types of flying. He says the Eclipse 550 burns 59 gallons of jet fuel per hour while flying 430 miles per hour, compared with 83 gallons per hour for its nearest competition—Cessna's Mustang—at its top speed of 390 mph, and is the only jet that sells for under $3 million."

"The company plans to deliver 47 jets in 2014 and 50 to 100 in 2016. Mr. Holland estimates revenue of more than $125 million in 2014 and expects to deliver units at an undisclosed profit once it reaches the 50-a-year production mark."

(08-01-12)

64. Free Trade and Economic Strength
Virginia Postrel reviews the work of Stephen L. Parente and Edward C. Prescott, whose Barriers to Riches (MIT Press, 2000) argues that poor countries stay poor because "some groups are benefiting by the status quo."  The authors suggest it is not knowledge but narrow self-interest that keeps nations from advancing their productivity.  It's not savings or education that makes the difference, but encrusted interest groups and outdated business practices.  Without free trade, local barons can block new practices, since better competitors can't invade their protected markets.  What would be as interesting is an examination of our own United States. Clearly economic development has been retarded in several areas--notably the South--because of anti-competitive practices, embedded in the law, which permit high-priced monopoly conditions to prevail.  See The New York Times, May 17, 2001, p. C2.

63. Global Inequality
Our ideologists have made us aware of growing income disparities within these United States.  More important is the massive gap between the haves and the have-nots world wide.   Robert Wade of the London School of Economics does a bang-up job of laying out this issue in "Winners and Losers," The Economist, April 28, 2001, pp. 72-74.  "New Evidence suggests that global inequality is worsening rapidly.  ...  By 1993 an American on the average income of the poorest 10% of the population was better off than two-thirds of the world's people."  Wade states that richer regions tend toward democracy and stability, the poorer toward ineffective government and war.

62. Paradise Lost--California
Victor Davis Hanson, grape farmer and professor of classics, tells how California has lost its infrastructure through squabbling and fuzzy thinking.  See The Wall Street Journal, March 21, 2001, p. A22.

"Not since the robed philosophers of Rome and Greece bickered and harangued each other by lamplight has history seen such a sophisticated preindustrial society as our own."

Hanson goes on to relate how Californians have done in their electric-power, educational, and transportation systems.  To learn more from Hanson, see his new book, The Land Was Everything.

61. American Net Worth Down 2% for the First Time in 55 Years
See The Wall Street Journal, March 13, 2001, p. A2.  This decline is the downside of the stockmarket, since a good part of the erosion comes from falling stocks.  We believe, however, that this is also part of a two-decade decline in the American standard of living, which shows no let up, whatever our fiscal or monetary policy.

60. Worldly Singapore
Singapore, as usual, is proving to be one of the smartest nations around.  While the world appears to be breaking up into regional trading blocks and we can no longer move bananas to Europe, Singapore--on a bilateral basis--is a rampant world trader.  Although it had a recession in 1998, because so much of its trade was confined to Southeast Asia, now it has trade deals in the works with Australia, the U.S., Chile, Japan, and Mexico.  Moreover, it has just inked an agreement with New Zealand.  See "Looking for Free Trade Far From Home," Business Week, March 5, 2001, p. 58.

59. Internet on Mars and Jupiter
Chad Edwards of the Mars Network office is hard at work putting the Internet out in space.    His intention is to move enough data fast enough to do truly ambitious experiments and develop other applications using advanced transmission.  We will be "developing relay links that increase the amount of data we get back from Mars....   After Mars, the next planet we'll probably attempt to contact is Jupiter and its moon Europa, which has signs of a liquid ocean underneath the frozen ice cap."   See "Calling Mars," CIO, pp. 139-44.

58. Wind Power
Dick Rhodes, who has written a seminal book on the development of atomic power, does not give much credence to alternative sources of power--solar, wind, ocean, etc.  Nonetheless, the economics are improving for offbeat power.  The Stateline Wind Power Project looks like it will turn out 300 megawatts for Portland, Oregon at 4 to 8 cents per kilowatt-hour.  See "For Portland, Generating Energy Is a Breeze," Business Week, February 19, 2001. 

The possibilities of using wind energy are gaining even more advocates in the United States, as proponents realize that the equipment is getting more practical and more reliable.  An offshore wind farm is now proposed by Cape Wind Associates to be located off Cape Cod:  its 170 turbines might supply as much as half the energy for Cape Cod, Martha's Vineyard, and Nantucket.  Apparently this is the first serious effort to build a major offshore wind-generation project.  See the New York Times, April 16, 2002.

Update
In May 2001, General Electric bought bankrupt Enron’s windpower division for $285 million.  This is yet another sign that wind energy is going mainstream.  Now wind energy is competitive with coal and gas, some of it now selling in the 3 to 6 cent per kilowatt hour range.  “The price has come down by 80% over the past 20 years,”  according to Lew Hey, chairman of FPL Group.  Green power quotas—both in certain states and at the national level—are expected to drive wind use upwards.  GE has introduced the world’s largest commercial wind turbine, rated at 3.6 megawatts, twice today’s customary 1.5 megawatt units.  See Business Week, March 3, 2003, pp. 116-117A.

Update
Innovation continues apace in the world of windpower.  To deal with the force of the wind, windmills up to now have had to be quite expensive and heavy.  “If the whole contraption could be turned around, and the fan placed downwind from the support pole….  The blades could then be less stiff, and would therefore be lighter and up to 25% cheaper.”  Now Wind Turbine Company of Bellevue, Washington has come up with such a turbine, using supercomputers to come up with the right design.  The prospect is that these designs can produce power at 3.5 cents per kilowatt hour, which is very competitive with coal.  See Economist, March 25, 2003, p. 6.  www.windturbinecompany.com/index.html.

Update
The efficiency of windpower turbines has gone up about 5% every year, according to “Phillip Andres, a vice president for business development at Vestas America Wind Technology, a subsidiary of the world’s largest manufacturer of wind turbines.”  (See www.vestas.com and www.vestas-awt.com.)  Michael O’Sullivan of FPL Energy, “the biggest domestic operator of windfarms, said that 2003” “will probably be the second-biggest year in the industry’s history, in terms of adding capacity,” second only to 2001.  Cape Wind Associates has a meteorological tower in Nantucket Sound taking wind speed readings, which are posted to its website as an aid on where to erect turbines, to provide wind data to fishermen and others, and to help build support for wind emplacements in Nantucket Sound which is being stoutly resisted by a host of locals (http://capewind.whgrp.com/).  See the New York Times, August 28, 2003, pp. El and E6.

Update
“Energy companies plan to erect more than 1,000 turbines off England’s coast in a $12.4 billion project to build the largest source of wind energy.”  “The wind farms ... would generate as much as seven gigawatts of electricity—enough to supply four million households, or to meet 7 percent of Britain’s energy needs.”  See The New York Times, December 19, 2003.  Also see British Wind Energy Association at www.bwea.com.

Update
Don Quixote was renowned for tilting at windmills.  In the modern age, windmills no longer are fair game for errant heroes, but rather a significant factor in national energy policy.  “Spain is already one of Europe’s largest producers of wind power, second only to Germany, and its capacity of 8,500 megawatts can supply close to 5 percent of the country’s electricity.”  Today all its windpower comes from land wind farms, but two companies now plan to put about 400 turbines off Spain’s southern shore.  In Europe “wind farms based at sea today still have a modest capacity of 600 megawatts, but that is expected to grow more than tenfold by 2010,” according to Corin Millais, director of the European Wind Energy Association (www.ewea.org).  See “Where Nelson Triumphed, a Battle Rages over Windmills,” New York Times, January 10, 2005, p. A4.

Update: Windy Plains
“The Great Plains states have enough wind to generate roughly 2½ times the total electricity consumed each year in the U.S. … says John Dunlop of the American Wind Energy Association, based in Washington, D.C.  …  The Rosebud Sioux stumbled on the idea of converting their wind into electricity  in the mid-1980’s, when they started looking for a low-cost energy source and discovered that the wind on their reservation could theoretically power one-twelfth of the U.S.”  Since then, the tribe has built a 750-kilowatt, 190 foot wind turbine, enough to power 220 homes, with the help of Disgen, a Colorado firm.   See Fortune Small Business, February 2005, pp. 46-47.  “The  Rosebud Sioux commission is now planning a 30-megawatt wind farm with 18 wind turbines that is expected to go online next January.”  With windpower costs now down to 4 cents a kilowatt when you through in subsidies, “installed capacity increased 36% last year….”  For more on American Indian windpower activities, see www.nrel.gov/docs/fy04osti/35445.pdf.  (6/22/05)

Update: China—Wind at its Back
China, with chronic energy demands, vast pollution, and wasteful energy systems, is now very much getting into windpower.  “Today we’re producing 68 megawatts, but by 2008, we’ll generate at least 400 megawatts,” boasted Li Yilun, the director of the Huitengxile power plant (New York Times, July 26, 2005, p. A4).  “By 2020 … China expects to supply 10 percent of its needs from so-called renewable energy sources….”  “Already, large wind farms are sprouting up much in much more heavily populated provinces, like Guangdong, Fujian and Hebei,” and costs are becoming competitive with China’s abundant coal-fired projects.  Wang Zhongying, director of China’s Center for Renewable Energy Development, anticipates growth to 4 gigawatts by 2010 and 20 gigawatts by 2020.  The big constraint is the lack of a sophisticated national grid to transport power.  Some 20 years ago Wu Gang visited the United States and helped import its windpower technology for use in China.  Today he heads Goldwind Science and Technology Company, China’s largest producer of wind turbines.  Vestas, probably the world leader in turbine equipment based in Denmark, expects to share widely in the booming Chinese market.  (8/17/05)

Update: The Windblockers
A conspiracy of political dunces—politicos and lobbyists—is trying to hold back the wind.  Republican Don Young of Alaska is trying to tack an amendment to the Coast Guard budget that “would prohibit new offshore wind facilities within 1.5 nautical miles of a shipping lane or a ferry route.”  This would rule out the wind farm proposed by Cape Wind Associates for Nantucket Sound.  In general conservationists and even health advocates are pushing wind energy.  But fishing interests, sundry local communities, and friends of well-heeled vacation venues such as Senator Ted Kennedy and Governor Mitch Romney are trying to stave off wind towers.  It is noted that Denmark, for instance, has towers much, much nearer major shipping channels—and has had no particular problems. See the New York Times, December 15, 2005, P. A15.  What seems to be at stake here is not safety or concern for fisherman—but pure resistance to towers that will mar the view.  (1/11/06)

Update: Windpower InnovationsVertical axis turbines.  “TMA, a company based in Cheyenne, Wyoming, announced in November that its first vertical-aix turbine (VAWT) would soon be ready for commercial production.  The TMA system has two sets of vertical blades….  TMA claims that its system harvests 43-45% of the wind’s available energy; conventional propeller-style turbines, in contrast, have efficiencies of 25-40%” (The Economist Technology Quarterly, March 12, 2006, pp. 3-4).  “A British consortium … believes VAWTS could be the best design for giant offshore turbines,” and the Brits are contemplating major offshore wind-power growth.  These blades can be manufactured more easily and do not encounter the same stress problems in high winds that pose construction difficulties for horizontal blades.  There is some skepticism that these blades will work out in practice. 

Home Market Windmills.  “This summer Southwest Windpower of Flagstaff, Ariz., will introduce a wind turbine just 45 feet high” (compared with conventional 100 foot structures).  Beta 1.8 will produced electricity even in light winds.  Southwest has grown to 60 employees and $10 million in annual revenues and has just raised some more venture capital.  Retailing at $6,000, this “personal size” turbines will plug directly into a house owner’s circuit board (FSB, April 2006, p. 81).  (5/10/06)

Update: Nippon WindAs in Europe, a number of projects are springing up in Japan that represent an outburst of sentiment at the grass roots for windpower.  Trends in Japan announces that Japan is now getting wind active, and it already enjoys a leadership position in solar power: 

Clean and Green

A nonprofit organization called Hokkaido Green Fund has spent the last few years building and running large-scale citizens’ windmills, which have also been catching on in Europe.  The NPO’s first windmill, nicknamed “Hamakaze-chan,” started operation in September 2001 in the town of Hamatonbestu, Hokkaido, a location buffeted by constant winds. 

In subsequent years, the NPO has constructed and started operating five large-scale windmills in northern Japan with the cooperation of local civic groups.  Among the locations are Ajigasawa Town in Aomori Prefecture and Ishikari City in Hokkaido. 

In 2006, the NPO plans to build five windmills in four prefectures in the Tohoku region of northeast Japan and in the Kanto region, which encompasses the Tokyo metropolitan area.  These include facilities in Asahi City in Chiba Prefecture, Kamisu City in Ibaraki Prefecture, and Akita City in Akita Prefecture. 

The power-generating windmills stand 60 meters high, and each one can produce enough electricity for 1,200 households.  But this comes at a price: the construction costs for a single windmill are in the order of ¥300 million (about $2.61 million at ¥115 to the dollar).  To raise such funds, the NPO relies on residents in areas where the windmills are built to cover half the costs, while the remainder comes in the form of subsidies from the New Energy and Industrial Technology Development Organization (NEDO).  Under this arrangement, there is no financial reliance on power utilities or other private corporations.

A big advantage of this system is that not only does it secure power for households, but any excess electricity the windmills generate is sold to utilities, with the profits going to the investors in the respective projects. 

Powering Japanese Industry

As for industrial-use windmills, Mitsubishi Heavy Industries, Ltd. has constructed Japan’s largest wind turbine at its Yokohama Dockyard and Machinery Works in Yokohama.  The machine stands 116 meters high and can produce as many as 2,400 kilowatts of power.  Performance testing got under way in January 2006 and is expected to last from six months to a year.  When that finishes sometime in 2007, MHI plans to take orders from power-related companies to supply them with wind-generated electricity.  “We want to expand our businesses related to new energy,” comments an MHI official. 

Denso Corp., Japan’s biggest producer of auto parts, has been focusing its efforts on its “hybrid windmill.”  Located at the company’s Anjo Plant, the facility uses wind generated from ventilation and cleaning equipment at its die-cast factories, in addition to natural wind.  The wind turbine, which began operating in early 2006, reportedly produces a maximum output of 2 kilowatts, which will be used to power the lobby and conference rooms at the facility.  This form of hybrid technology is attracting attention for its ability to derive energy from “manmade wind,” a resource that otherwise goes unused. 

Although Japan’s wind-generation efforts are still in their infancy, it is a field that is rapidly expanding.  The total output of the nation's wind turbines as of March 2004 was 0.67 million kilowatts.  Given today's increasingly severe environmental and energy situation, this figure seems likely to grow and grow in the years ahead.  (5/17/06)

Update: More Wind on Wind
Senator Kennedy and others, with vacation homes in the area, are stoutly resisting wind farms in Nantucket Bay.  Now a similar flurry of fury is rising around Buzzard’s Bay where an entrepreneur is proposing extensive development: 

Prominent Boston construction contractor Jay M. Cashman wants to build up to 120 wind turbines off Fairhaven and Dartmouth, in one of the Northeast’s busiest shipping channels and a popular recreation area. The turbines would reach heights of 450 feet, and be located as close as 2 miles off shore.

By 2011, he hopes to build clusters of 30 to 40 turbines off Fairhaven, Dartmouth, and Naushon.  The turbines, he said would generate enough electricity to power half of Cape Cod.  …  The developer said he chose Buzzards Bay for its engineering merits, not its demographics.  The area, he said, has average annual wind speeds of 20 miles per hour, ocean depths of 50 to 60 feet to anchor the turbine, and is close to existing transmission lines (Boston Globe, May 24, 2006, pp. B1 and B8).  (6/7/06)

Update: A Bag of Wind?
If we can believe William Koch, President of Oxbow Corporation and a major investor in alternate energy, the Cape Wind proposition off Nantucket won’t hold water and is just a lot of hot air.  The politicians aside, he contends it would cost too much to build, that its energy would be very high cost, and that New England does not even need its electricity anyway.  See “Tilting at Windmills,” Wall Street Journal, May 22, 2006, p. A12.  “When you do the math, it is clear that every other form of power generation would be cheaper to build, produce more electricity at a consistent rate and save consumers more money. When you consider the costs and risks of an offshore wind farm, and the fact that New England does not need more power, the project becomes nonsensical, a giant boondoggle for the benefit of one developer.”  Koch, of course, has looked at wind before and turned it down, and is heavily into coke, coal, and methane.  Since the Danes and now the British are convinced that offshore wind farms are viable, one must carefully look at his assumptions.  (6/20/06)

Update:  Texas Blowhard
“In 2005, Texas was second only to California in terms of installed wind generating capacity, with 1,995 megawatts….  Most wind farms are on private land in west Texas and the even more blustery Panhandle, but this spring the state signed a lease for the largest offshore wind farm in America, in submerged lands near Padre Island national seashore” (The Economist, July 1, 2006, pp. 29-30).  “Another Gulf of Mexico agreement, off Galveston, was signed last fall.”  (8/9/06)

Update: Windpower India
Last September Tulsi Tanti took his wind turbine company public: Suzlon Energy achieved an immense valuation and Tanti became a $6 billion man and the seventh richest Indian (Economist, June 17, 2006, p.72).  For the year ending March 2006, “sales and profits had doubled,” and the company captured more than ½ of the Indian market, “becoming the world’s fifth-largest maker of wind-turbine generators.”  Wind now accounts for 3-4% of total electric generation capacity.  “It is based in the state of Maharashtra, in Pune, which, “because of its wealth of colleges, has also become a magnet for the information-technology and outsourcing industries.”  He started in textiles and soon enough found out that erratic electricity posed a problem for his business.  Now he is out of textiles.  Companies wanting to steady their electricity flows buys windmills that are put on shared farms; if the investment generates enough electricity, the investing company avoids power cuts.  Accelerated depreciation is the other big goad to windpower investments, with many buying in because of the tax advantages.  Suzlon has, however, become less dependent on the whims and tax structure of India, with 75% of its current orders now outside India.  Having bought gearbox maker Hansen in Belgium, and with factories in China and Minnesota, Tanti is making himself into a true multinational.  (10/25/06)

Update: More on Suzlon
“Wind Man,” Forbes, June 19, 2006, pp.124-126 is yet another salute to Tulsi Tanti’s amazing growth in the wind business.  He’s fourth in U.S.-installed capacity, behind the big guns who are GE and Vestas, as well as a very respectable Mitsubishi, while he places just ahead of Gamesa.  “Their research efforts got a boost when Sudwind went bust in 1997.  They hired Sudwind’s engineers and created an R & D center in Germany.  The subsequent acquisition of a manufacturer of rotor blades in the Netherlands rounded out the business.”  (12/27/06)

Update: Wind at Massport
Senator Kennedy, as we have noted, is resisting windpower offshore, where it may ruin the view for his vacation retreat.  But Governor Romney seems to know that wind has to come, and not just when it comes from the mouth of politicians.  “City and state officials are proposing to build a $9 million turbine test tower and laboratory on a pier in Charlestown” (Boston Globe, December 13, 2006, pp. D1 and D4).  (2/28/07)

Update: Solar Burst and Wind Gusts
Wind energy production grew 45% last year, and solar power also surged at a similar rate, albeit from a much smaller base.  Wind-power hit a record 5.244 megawatts of capacity “that amounted to a third of all new generating capacity built in the U.S. in 2007….  General Electric Co. led the pack as the nation’s largest supplier” (Wall Street Journal, January 18, 2008, p. A6).  Solar added 300 megawatts.  “Large commercial solar installations now exceed home installations in California,” a reversal that is likely to change the face of the industry.  “More than 3,000 megawatts of giant concentrating solar projects” are to be built in the Southwest “with utilities buying the electric output.”  Lots of the equipment is imported, but now more domestic manufacturing capacity is being constructed.  New Mexico, in particular, has offered major incentives for solar companies.  (3/12/08)

Update: Europe’s Wind Colossus

“Vattenfall, a Swedish electricity provider,” bought “the non-grid business of Nuon, a Dutch counterpart.  The deal will eventually create Europe’s biggest operator of offshore wind energy:  both companies are big in renewal and clean energy, including solar and tidal power.”  Economist, February 28, 2009, p. 20. (08-26-09)

Update: A Museum Churns Out Windpower

"The Maryhill Museum of Art in Goldendale, Washington has "15 wind turbines, part of a vast installation that sends 500 megawatts of electricity a year to Los Angeles and about $250,000 each year into the operating revenues of one of the most isolated art museums in the contiguous United States."

"Maryhill raised the money for the addition through public and private grants — no small feat given its size and location and the challenges facing arts institutions — but museum officials say revenue from leasing its land for wind energy provided the confidence and financial security to proceed with the capital campaign at a time when the number of visitors, about 45,000 a year, is well below its peak in the 1990s"

Capturing the wind is not the only way Maryhill uses its land to benefit its bottom line. The museum brings in about $60,000 by leasing acreage for fruit orchards and vineyards. It earns about $20,000 each year by renting access to the Loops Road, a series of curving roads built by Mr. Hill that is now the site of the annual Maryhill Festival of Speed, a skateboarding contest.

(07-04-12)

57. A Second Act for Complexity
The complexity scientists always seem to be headquartered in Sante Fe.  They can think about complex things because it it relatively simple there, except for the melange of human relationships.  In "Making the Complex Simple" (January 27, 2001, pp. 79-80), The Economist makes it clear that the first wave of complexity research was intellectually rewarding but not too useful.  New looks at complexity in simple systems are more promising.  We would expect, in time, that this work will help us construct more durable systems.

56. Ocean Power
In November of 2000, a Wavegen LIMPET 500 generator started supplying power to homes on the Scottish island of Islay.  The generator can supply 500 kilowatts, handling 400 homes.  Built by British Wavegen Co., it has unique features to capture and transfer wave power to its turbine.  See Business Week, February 5, 2000, p. 1108.

Update: Ocean Swells:  Though we have commented quite a bit on wind and solar power, we have done just a bit here and there on efforts to harness ocean power, from tapping into ocean tides—in the Bay of Fundy, for instance—to other more complex schemes.  Wikipedia has a fairly good, short article on tidal power (http://en.wikipedia.
org/wiki/Tidal_power
).  We think you will begin to see more about ocean swells.  Engineers Annette von Jouanne and Alan K. Wallace at Oregon State University have devised a buoy.  “[A]s the buoy moves up and down,” a coil moves up and down around a magnet, producing anywhere from 50 to 100 kilowatts.  EPRI plans to test a fleet of buoys off the coast of Oregon.  See Business Week, July 4, 2005, p. 53.  (7/13/05)

Update:  Tidal Turbines

More and more, we are learning to harness the ocean.  From the ocean floor we are deriving both oil and minerals.  Now, gradually, we are learning to put windmills far out from the coasts where they can capture rather steady winds, with the hope of generating even more current than we can get from onshore installations.  The possibility of putting the tides to work is very intriguing, as recounted most recently in “Generating Megawatts Like Clockwork,” New York Times, April 22, 2010, p. F6.  Ocean Renewable Power is one of a number of start-ups trying to develop tidal energy, water-powered turbines that spin the current as the tides come and go, turning generators to make electricity that is clean” and hopefully “reasonably priced.”  There are some older, but somewhat outdated, tidal generating stations around the world, using barrages. While newer tidal energy projects are still in their infancy, optimistic observers believe it may take as little as ten years for this energy segment to catch up with land-based wind energy, which is now firmly established in a number of countries. (05-05-10)

55. Healthier Oldsters
From "1989 to 1994 morbidity ... declined a whopping 1.5 percent each year.  ...   If you can reduce the incidence of disability 1.5 percent each year through 2025 and 2030, then very long solvency can be maintained for Social Security and Medicare."  See "Listening to Our Elders," Eric Larson, Duke Magazine, November-December 2000, pp. 9-13.

54. Seeing How People Talk to Each Other
Some Helsinki Institute scientists have crafted software that maps electronically how individuals communicate within organizations.  Devised for project management, it has shown, for instance, that communication patterns don't change a lot during the life of a project, even though there is a need for new communication pipelines as a project advances.  There should be a caution, of course: people talk to each other differently in virtual space than they do in person or on the telephone.  But, importantly, this kind of mapping will eventually explode many of the assumptions about people and the Internet that underlie electronic commerce.   People act out of character when driving their cars on their computers.  See "Network Collaborations: The Big Picture," The Economist, January 6, 2001, P. 75.

53. Bankruptcy Looking Up
Our old friends at The Turnaround Letter (also owners of the very authoritative www.BankruptcyData.com) point out that 2000 was a banner year for the number of public companies achieving bankruptcy (2001 should set a record year for assets entering protection).  All this means a great time for the grey folks specializing in bad times.  See "Coming: Rich Harvest at Troubled Firms," Wall Street Journal, January 12, 2001, pp. C1 and C16.   Distressed debt doubled in both 1999 and 2000.  A number of Wall Street firms are adding to their SWAT teams, and we expect distressed-debt portfolio managers to achieve stellar investment performances.

52. Governor Taking a New Broom to Japan's Politics
See The New York Times, January 10, 2001, p. A3.  Despite all the talk of reform politics in Japan, nothing has really changed.  It is still only a democracy in form but not in substance.  In Nagano, however, Governor Yasuo Tanaka may be shaking things up.  This is not unlike the United States, where all the meaningful government re-engineering has happened at the state rather than the federal level.

51. Too Much Homework
See Forbes, December 25, 2000, p. 108.  "The heavier the homework, the poorer the test performance," except perhaps in Japan, when we look at eighth-grade math scores internationally.  There's now even a U.S. group pushing reasonable homework (www.sanehomework.com).   This is just another example of working harder rather than working smarter.  It affects every state and every schoolchild in the nation.

Update: Getting It Dead Wrong:  Update.  We have mentioned in more than one place that kids are being overloaded, and we suspect it contributes to the growing depression and suicide rate they are experiencing. Kindly also read more about this topic in item 44.  

Now some dumb surveys have come out saying the homework load is not too great, and claiming the kids could even handle more.  Mr. Tom Loveless (amazing how some researchers have names that perfectly describes their research) of the Brookings Institution asserts, based on his studies that people “should realize kids are not overworked—and indeed, there is room for even more work.”  “The Brookings report is based on widely cited data from the U.S. Education Department, international surveys and research by the University of Michigan and the University of California, Los Angeles, among other sources.”  See Wall Street Journal, October 1, 2003, p. D10.  Hmm, did you say the data was generated by folks in the educational establishment?  That’s about as good as the research journalists have generated ad nauseam saying that print media don’t have it in for business.  When you do research about yourself, guess what happens?  As interesting here is the poor reporting by the Wall Street Journal, which should have, at a minimum, talked with some of the substantial figures who do find children overloaded in every conceivable way.

Update: Only the Elites have More Homework
Margaret Talbot, part of a journalist advocacy tank in Washington called The New American Foundation, theorizes that homework has increased for toddlers, but that the big jolt above that age only afflicts elite kids attending private schools and high-powered public schools.  She thinks they are the progeny of high-powered, professional parents with intense schedules who fill their kids lives with book reports, oboe lessons, and soccer and that, in effect, the children are in overdrive because their parents are at the wheel, not because our school systems have gone off the deep end.  See “Too Much,” New York Times Magazine, November 2, 2003, pp. 11-12.  We ourselves are more inclined to pay attention to the Time magazine article “The Homework Ate My Family,” at http://www.time.com/time/2003/kids/homework.html.  There are now, incidentally, some formal groups resisting the homework explosion and efforts in some states (Virginia, Pennsylvania, Massachusetts) to contain it.  We ourselves clearly think that those denying this make-work problem are just a bit delusional and that quantity has clearly supplanted quality.

Update: Turning out the Lamps
We have essayed again and again about too much homework.  The schools are meting out huge amounts of busywork: it impedes learning and burns kids out.  Now some districts are getting smarter.  See “Schools Turn down the Heat on Homework,” Wall Street Journal, January 19, 2007, pp. W1 and W12.  Some schools are limiting or even ending it, especially in lower grades.  “The moves are largely at elite schools in affluent areas.” “Several new books and studies have documented the negative effects of too much homework and found no corresponding improvement in academic performance.” “Stressed Out Students, a Stanford University program, is working with 52 schools across the country to find ways to reduce pressure….”  The WSJ cites a paper showing little correlation between the volume of homework and math/science scores in various nations:

LESS HOMEWORK, HIGHER SCORES

A new paper has found that world-wide, students with more homework often have lower math scores.  Below, data from 2003 for the U.S., plus countries with the highest and lowest percentages of students who studied more than four hours a night. 

COUNTRY

4 HRS + OF HOMEWORK PER NIGHT

MEAN MATH SCORE

Lebanon

24%

434

Armenia

23%

478

Romania

22%

474

South Africa

22%

266

Tunisia

20%

411

Moldova

19%

459

Jordan

19%

424

United States

5%

504

England

3%

498

Morocco

3%

387

Netherlands

3%

536

Scotland

2%

498

Korea

1%

587

Japan

1%

569

Source: Gerald K. LeTendre & Motoko Akiba. “A Nation Spins its Wheels: The Role of Homework and National Homework Policies in National Student Achievement Levels in Math and Science,” 2007.  Mean scores ranged from 266 to 605.  (4/4/07)

50. GE Jet Engine Troubles Symptomatic
See Business Week, January 15, 2001, p.44 and The Wall Street Journal, which recently did a significant front-page story on all the problems with the CF-6 engine.  GE, viewed as one of the world's best-managed companies, has a long history of glitches in the capital-equipment arena, from power generators to computers.   Someday adventurous B-school professors will study what it is in GE's culture that produces these cracks in the mirror, despite the fact that Mr. Welch signed up for Sigma Six.

49. Good Bye, Torpid Torpedoes
Water travel has never been very fast, whether we're talking about boats, swimmers, or projectiles.  At least not until now, that is.  The Russian Squall rocket-propelled torpedo barrels along at 230 miles per hour, and no other nation has anything that can touch it.  See "Behind Spy Trial in Moscow:  A Superfast Torpedo," New York Times, December 1, 2000, p. A3.

48. Tiny Is Big
Nanotechnology.  This means maneuvering things atom by atom to achieve unusual things.  See “Downsizing,” by Nicholas Thompson, The Washington Monthly,   October l7, 2000.  Apparently Eric Drexler first laid out the potential of the micro/micro/micro world for the layman in his book Engines of Creation.  Although Thompson warns us on the perils inherent in this field, suggesting that there is a need for thoughtful regulation, clearly the economic potential is as big as he implies.  We are about to see a host of new materials with amazing properties and potential.  See “It’s A Nano World," Business Week, November 27, 2000, pp. 76-82.   Material Science, it seems, is about to have its Golden Age.  Incidentally, a nanometer is one-billionth of a meter. 

47. Diabetes Will Double in 25 Years
This is yet one more epidemic beginning to happen.  The International Diabetes Federation projects a tremendous increase in Type-2 (adult) diabetes occasioned by poor eating habits and other forms of sloth in developed and developing nations.   Diabetes already affects five percent of adults.  “The number of diabetics has grown 11 percent in the past five years alone.”  See Financial Times, November 6, 2000, p. 6.

46. Bad Service By Design
Who would have thought it?  As we have said before, services are the key factor in the New Economy: they are the way we now achieve double-digit growth.  But the anomaly is that service quality is radically declining.  Business Week partially gets at this paradox in "Why Service Stinks," by Diane Brady, October 23, 2000, pp. ll8-l28.  Brady notes that consumer companies are segmenting their audiences, consciously providing better service to their profitable customers, no service to their low-volume, low-profit customers.  What they miss is that these companies even do a lousy job with their big-ticket, bread and butter customers, rudeness and sloth spreading into all their operations.  In any event, these companies are tarnishing their brands, often beyond repair, creating vast openings for those who will seize the service moment.  There is an opening for anybody who will do it right.

45. Trash Texts
Perhaps you think you can beat the system (the broken down school system where pupils, teachers,  and parents are all being taken to the cleaners by rampant mediocrity) through home-schooling.  Don't plan on it.  If you have your eyes open, you will discover that most of the new textbooks are a disgrace as well, littered with errors, poor organization, and half-baked, confused educational theories.   We repeat--the books are junk.  David McClintick ("The Great American Textbook Scandal," Forbes, October 30, 2000, pp. l78-83) goes into this quagmire, especially the downward spiral in California, directly correlating low proficiency of U.S. students in math with the second-rate texts from which they learn.   For this reason, it is not clear that increased spending on education will net us anything.  Our expenditures per child are already reasonably high: we are spending the money badly.

44. Too Much Homework
We have already mentioned that schoolbids are overburdened by schooldays without breaks that are too full of trivia,  not to speak of after school activities that go on to long and are too intense.  But the spirit of wretched excess that produces dumb, depressed children also leaks over into the evenings, and parents are rebelling.   Again, quantity overwhelms quality, stemming from a school hierarchy that lacks perspective and a sense of proportion.  See Kate Zernik's "Homework:   What's Enough?  One District Takes A Stand,"  New York Times, October 10, 2000, Al and A29.  Now, of course, there is a new book about work overload--John Buell's The End of Homework:  How Homework Disrupts Families, Overburdens Children, and Limits Learning (Beacon, 2000).  Antidote:  Lighten up at home and talk back to schools, school boards, and glib politicians.

43. Democracy Moribund
When we visited Japan in l976, we were stunned to discover that General MacArthur had created a state with all the organs of democracy that operated in a fairly authoritarian manner.  Democracy is still getting started there, though it promises to take off, since it will be one of the engines of economic recovery in Japan considering that the LDP crony system just can’t deliver at the moment.  Interestingly, democracy is declining in Europe,  because the failed experts who run the European Union are not looking for enlightenment from the masses as they enact a plethora of regulations.   In this vein,. Larry Siedentop’s new book Democracy in Europe is worth a look (see Economist, August l9, 2000, page 73).  Siedentop finds that the French bureaucratic model has been infiltrating all European institutions.   We have suffered some democratic degeneration here in the United States, mostly occasioned by the dumbing down of our populace stemming from a broad, incredible decline in our educational system to include our schools, churches, newspapers, magazines, etc.--the whole fabric of institutions formally and informally dedicated to education.

42. Time Out
If whole families are overscheduled and stressed out, men are women are looking for deep and fulfilling ways to get away from absolutely everything.  “Monasteries and spiritual centres throughout the United States find that demand is booming.”   (See “The Lure of Silence,”, Economist, August 19,2000, p. 27.)   Clearly the quest for silence is more than a response to too much work too many days a week.  TV, computers, telephones, wireless Internet--too many messages have become the man-made mosquitoes that bite people and everybody is looking for bug-off.

41. Family Income Up; Standard of Living Down
Despite our apparent prosperity, the middle classes are not winning, and they are going to catch on eventually.  In two-worker families, income has risen, even adjusted for inflation.  “But the inescapable fact is that if women did not work, most family incomes would not have risen at all in the l980’s and l990’s.”   (See Jeff Madrick’s “Economic Scene,” New York Times, August 31, 2000, p. C2)   With two wage earners working 80, 100, or 120 hour (combined) workweeks, the children get less care, the meals deteriorate, and leisure shrinks.  The few hours outside work are now used to do the chores that used to be done by the non-working partner.  It’s just possible the middle class are not contented—just tired.

To get some first-hand reporting on how two-worker families are seeing their lives evaporate, read Wall Street Journal reporters Tara Parker-Pope's and Kyle Pope's, “A Balanced Life,”  Wall Street Journal, Sunday, September 10, 2000.  They tell how they have a rough time meeting work deadlines, while trying to maintain a family—even with flexible schedules.

40. DNA and Digital Worlds Are Merging
Incyte Genomics reports that Motorola has licensed its gene patents and gene- sequence databases for Bioarray Gene Commercialization.  On August 16, IBM announced a $100 million life-science investment in a wide range of activities, including the formation of a special unit to focus on this area.  Playing with DNA, Lucent's Bell Labs puts together nanorobots.  In the future, similar applications to DNA circuitry are expected to yield nanocomputers "1,000 times faster than today's speediest."   (See Business Week, August 28, 2000, "Fueling the Nano World with DNA," p. 215.)  Now, too, biotech companies can begin to expand the scope of their collaborations well beyond the pharmaceutical companies, not only to the world of electronic chips, but to the big chemical companies.  Chemicals, if we can get past the terrible inertia of the chemical industry, is the largest plausible market for biotechnology over the next 25 years.

39. Liberty in Tatters
We remember, back in 1956, working beside escapee Hungarians in the college dining hall.  America had become their haven after the abortive revolution against the abominable Russians who sat astride their country.

In general the U.S. can look with pride, even with lapses on several occasions, at helping victims of oppression from several countries.  We fear this is no longer true.  As our moral climate has declined, our outrage at lawlessness has evaporated, and expediency has moved into the driver's seat.

Elian Gonzalez is not the first pawn in the diplomatic chess game who has been destroyed.  Our government has traded lives for trade, half-based political openings, or some other real or imaginary quid pro quo with dictators around the world.   Nowhere, do we suspect, does the U.S. now symbolize the love of freedom.

This week's New York Times Magazine contains a high-profile example of this very trend.  See Andrew Cockburn, "The Radicalization of James Woolsey," The New York Times Magazine, July 23, 2000, pp. 26-29.  Our Immigration Service, apparently at the behest of the CIA, wants to send Iraqis home to certain death in S. Hussein's Iraq.  Ironically, R. James Woolsey, a former CIA director, has become their legal defender.  Are we not in a bad way if liberty has to be upheld by an ex-spymaster?

And we suppose you've read about the Middle Eastern princess who has wed an American Marine.  The INS is also in a hurry to get rid of her.  See "Trapped in a Web of Politics and Love," The Boston Globe, July 14, 2000, A8.

We hear it was foggy when the Tall Ships pulled into New York this year.  Could they even see Lady Liberty?

38. Design (and Other Professions) Is Finished
The very, very interesting Italian designer Matteo Thun thinks design is finished.  See "Matteo Thun and the Death of Design," Graphis, number 326, March/April 2000, pp. 39-45.  Always believing emphatically (as we do) in the relationship of architecture and design of all types, Thun says, "I believe that design is already finished.  It doesn't exist anymore.  In Europe, there is a return to the awareness of the importance of interdisciplinary and contemporaneous professions.  In the future one won't be able to study one thing....  The era of specialization is over."

37. Civil Combat
Who would have thought that our sons would be focused on golf, lacrosse, and a slew of alternate sports, instead of baseball, football, and basketball, that dominated our early years?  The boredom with commercialism surrounding TV sports and the national passion for diversity that is driven by cable TV have led us to alternate sports.   But, even more, we think, the sportsmanship and civility surrounding these newish amateur sports activities are central to their attractiveness to school kids.   Certainly, "civility" is a key part of the revival of croquet.  See "Croquet Is Becoming a Wicket Obsession," The Boston Globe, July 7, 2000, E8.

36. Together Again
For years, Christian religions and sects have been flirting with each other, weighing the idea of coming together in the distant future.  The future, it seems, has finally arrived.  The Episcopalians and the Evangelical Lutheran Church have formed an alliance that stops short of an outright merger where they can share ministers, facilities, etc.  The accord is called "Called to Common Mission."   See Michael Janofsky's "Episcopalians Near Alliance with Biggest Lutheran Group," The New York Times, July 8, 2000, A7.

This is not unlike consolidations in the worldwide banking, oil, telecommunications, and other industries.  Economics, to include manpower shortages and growth problems, as well as a failure to adequately redefine their products in the Internet Age of Stress, seem to have produced this trend.  Amalgamation is their substitute for transformation.  Meanwhile, the evangelical and charismatic movements capture the real growth in adherents.

35. Phony Numbers
For a long time many of us have known that inflation is and has been much worse than all the official statistics would have us believe.  Ray DeVoe, Jr., in The DeVoe Report, Vol. XXII, No. 18, June 16, 2000, has called a spade a spade.   "In conclusion, there is a comparable 'puzzlement' with the Consumer Price Index figures.  Housing ... is up only 2.9% year-over-year ... which makes no sense at all....  Similarly the news that gasoline prices declined 3.5% from April to May defies what drivers have been experiencing in recent months....  Fudging can only go on so long--until the data are totally discredited and unreal."  We've got trouble, folks.

34. Revolution at the Non-Profits
Finally there is all sorts of ferment in the non-profit sector, which promises to reconfigure our 1,000,000 or so non-profits around 21st-century goals and to institute more credible accountability.  Probably most important is the fact that more first-rate, effective minds are giving this sector real attention.  For instance, the Peter F. Drucker Foundation for Nonprofit Management (www.pfdf.org) not only has the provocative theorist Peter Drucker in its thrall, but also has Frances Hesselbein, former head of the Girl Scouts, as chairman.  Lawrence Small, an old Citibank hand and then president of Fannie Mae, just took the helm of the Smithsonian.   Chris Evans, a dot.com millionaire in Raleigh-Durham, has set up the Entrepreneurs Philanthropic Venture Fund, so that young tech leaders can borrow money against the stocks of their companies to put it to work in the charitable realm today.  (See The Wall Street Journal, Jan. 12, 2000, S1.)  Jim Barksdale is taking some of his Silicon Valley wealth--$10 million--and putting it to work in Mississippi to buttress children's reading skills there.  Primary education, of course, is the Achilles heel of Southern society, so this is a very innovative philanthropy.  And finally, more and more non-profits are starting for-profit subsidiaries with a view to strengthening their financial base in an era when support for charity is not proportionate to the demands for their services.  (See "When Non-profits Go After Profits," Business Week, June 26, 2000, pp. 173-78.)  If philanthropy can remake itself, there is some hope that we may also rework our several governments which, with rare exceptions, do way too much while doing way too little.

33. Swapped Out
Now the ultimate currency of the global financial system, there were $46 trillion swaps outstanding at the end of 1999.  "Ten year spreads peaked at the end of May at 140 basis points ... a higher spread than ever before....  At times in recent weeks, the swaps market has shut down completely; nobody was willing to receive a fixed rate."  (See "Danger Signs," Economist, June 19, 2000, p. 81-82.)   For some of us, this means the banking system is in trouble and that the beans should be riding high.

32. I Vant to Be Alone
William Safire, in two perceptive columns, "Too Much in Touch" and "Stop Cookie-Pushers," has taken up the issue of privacy in all its technological dimensions.  (See New York Times, June 8, 2000 and June 15, 2000, A1.)  He realizes that we're too wired in several ways.  When a Nixon Republican takes up privacy, you know we have a problem.  In the first instance, he counsels us to distance ourselves from cellular phones, pagers, and palm pilots, and says Garbo had it right with her line, "I Vant to be alone."  In the second column, he also asks for legislation barring on-line marketing snoops from putting "cookies" on your computer that can chart your every move without your clean consent.  Safire is dead right on both counts, profiling two areas where technology is encroaching on our freedom, welfare, and health.

31. Schools Amok
Our children are horribly over-scheduled, during and after school.  See "Parents Try to Reclaim Their Children's Time," New York Times, June 13, 2000, A14.  This article discusses hyper-activities after school.  But children's time is also over-crowded during the school day--it begins too early, doesn't have enough breaks, with too short a lunch.  Like their parents, children are doing too much and getting stressed-out.  As a result they are not really learning.   One teacher in Queens can't teach enough basic math, because drug education and other extra-requirements squeeze out the real curriculum.  In case you're wondering, state and federal involvement in local education is not helping.

30. End of Banks?
While large brick and mortar retailers are still fighting a good battle with parts of the e-commerce world, it is at least arguable that banks and other financial intermediaries are on their way out.  "Worrying for firms that make their living out of arranging financial transactions, the Internet might also have been designed to do with away with them....   Money, unlike, say, an item of clothing, is a commodity that can actually be used, transferred, and delivered electronically."  See The Economist, May 29, 2000, after p. 66.

29. Immigration Is Breaking Out All Over
High-tech industries in the U.S. have long known that we need to import technical workers.  Moreover, all the developing nations are experiencing a slow-down in birth rates and a decline in their working populations.  Now Japan, which has been dead-set against foreigners and immigrants, is having to rethink its ways.  Its most important business organization--the Keidanren--calls for many more foreign workers to keep Japan going.  Resident foreigners in Japan now amount to just 1% of the population, a figure that has to rise considerably.  See "Call grows for Foreign Workers in Japan," The Wall Street Journal, May 26, 2000, A 20.

28. Co-Op Gardens
Thousands of acres in our crowded, jarring cities could be converted to peace and beauty if William Drayton’s idea could come to pass.  In “Secret Gardens,” an article he wrote for the June 2000 Atlantic Monthly (pp. 108-111), he says backyards could be converted to cooperative parks in the city with a change in property law.  Indeed, New York City already has a few, but there could be many more.   Drayton is clear that this would have social as well as ethical value, fostering common, voluntary concern which ultimately turns aggregations of people into purposeful communities.

27. Patents Amok
As The Economist notes in "Patent Wars," April 8, 2000, pp. 75-77, companies are patenting up a storm to surround the riches that knowledge-monopolies afford and to bar others from any piece of their turf. This includes, particularly in respect to the Internet, surrounding broad areas of methodology and business practice which, in effect, if enforceable, could insure that there is only one real competitor in a business area.  Greg Aharonian already has a website, www.bustpatents.com, to cut through this kind of nonsense.  All this suggests that we need vast reform in the patent and intellectual property area. This, of course, is a puzzling task, since an inventor deserves substantial rewards from his ideas.  But, as we will point out in Dunk's Annual Report on Annual Reports 2000, the essence of the New Economy is "collaboration," and this is severely impeded by closed operating systems or other monopolistic knowledge practices.   

26.  New Chips Off the Old Blue
In 1997, IBM introduced new copper wire chips with 30% acceleration in speeds.   Now comes another possible gain of 30% with the use of copper insulation from Dow Chemical.  Just like Bell Labs, IBM's old-style research center is still producing some leading edge results.  See Business Week, April 24, 2000, p. 131.

25. The New Penicillin
Mother Nature is producing microbes -- such as a new strain of tuberculosis -- that resist all the best current antibiotics.  But now researchers at the University of Wisconsin and elsewhere are mixing some new compounds that bacteria may never be able to resist.  Of course, never say never.  But, nonetheless, this is truly just-in-time invention, because we have some major epidemics in the offing, with nothing of value in the medicine chest to fight them.  See Business Week, April 24, 2000, p. 131.

24. Apologia
The Pope, readying us for Lent, has just apologized for some of the sins of Catholicism, ranging from the Inquisition to the Holocaust.  Close on, Archbishop Weakland of Milwaukee, Cardinal Law of Boston, Cardinal Mahoney of Los Angeles, and many others have followed the Pope's lead.  (See The New York Times, National Report, March 18, 2000, A7.)  

While this refrain is not quite a "mea culpa," but rather a "we are culpable," this chorus of apologies still is earth-shattering.  Perhaps with this example, others may be close on their heels.

Can President Clinton and his entourage begin to say, "I am truly sorry?"   Could the leaders of AT&T, GM, and IBM tell their workers that they are responsible for running their great companies into the ground?  And so on.

Oh, what we might get done, if leaders could begin to accept responsibility for the wrongs that they have done and the rights they must do.  Of course, a little action will help, too.

23. Alien Technology
Thinking men in all walks of life are trembling about the technology in our midst: Jeremy Rifkin about biotechnology (see Scientific American's profile; his books The Biotech Century, and The End of Work; and the Biotech Century website) Bill Joy of Sun Microsystems about the computer, Steven Talbott about all of it (see his website and our Best of Class item on his newsletter).  Just like all the atomic scientists who bonded together against military uses of the atom, they show how familiarity with technology has bred fear, contempt, and loathing.  Technologists all, they sense how we are becoming slaves, not masters, of technology. 

But it takes an artist, not a techie, to paint the outlines of what's next:   Godfrey Reggio, former monk and now bleeding edge filmmaker (see Ty Burr's article "'Qatsi,' Part III: Technology Triumphs," The New York Times, March 19, 2000, Arts & Leisure, p.13).  He says:

"More important than empires and wars and other breakthroughs...technology is now an environment, the host of human habitation.  We don't live with the natural environment.  There's so much interest in aliens because we are the aliens.   We are off-planet."

22. The Financial Markets Are Out of Control
Greenspan to the contrary, we find that the world financial system is plain, flat, and clearly out of control.  Be it Japan or here, nobody knows how to get a severely flawed world system running again in a stable manner.  Right now this is all being papered over with a massive credit bubble. 

Look to our own stock market for further clear evidence that everyone is winging it, even those who have been successful.  The wacko markets are making fools of our wisest, most value-oriented professionals.  Warren Buffet has just owned up to a lousy performance last year.  Julian Robertson's Tiger Fund has gone from $22.5 billion in assets under management to $6 billion (See Business Week, March 13, 2000, p. 126-128). 

As we have said, the U.S. second quarter probably will be difficult for the economy.   Then the emperor's clothes will come off, and we will realize nobody has a handle on the rudder, and nobody understands how the wind will blow.

21. Making Ideas Big
It's always a question as to why one good idea or bad idea captures the popular imagination, while great ideas sit on the shelf for decades or centuries.  And, in our own age, we ask why drivel and nonsense become buzz, infecting all our media in the sweep of a moment.  Malcolm Gladwell's The Tipping Point (Little, Brown) is another attempt to explain how ideas spread in our times.  This is especially interesting now, because we don't really know how ideas propagate and spread in the age of the Internet. Mainstream newspapers and broadcasters often fail to connect with the popular mind, while informal media such as chatboards and evangelists distribute rumors, ideas, and fads much more efficiently.

Mr. Gladwell, a writer for The New Yorker, has shown some skill at flying his own balloons as The New Yorker has become more of a spin parlor.  In this vein, his website is very much to the point in how you tip the media your way in the age of buzz.

20. Renewable Assets?
A goodly portion of our housing stock -- perhaps 30 to 40 percent -- is manufactured and then shipped to the site for installation.  But the bulk of it is a depreciating investment which wears out, just like your automobile.  Unlike ordinary houses, the manufactured units are ultimately money losers.  With higher standards and better codes, these losers could be winners.  Such a change would have a huge and stabilizing impact on lower income groups.

19. Antibiotic Replacement
Bacteriophages from the old Soviet Union --  the Eliava Institute in Georgia -- may be the best thing to deal with bacteria now that "superbugs" are resisting all the antibiotics we can devise.  See Lawrence Osborne's "A Stalinist Antibiotic Alternative," The New York Times Magazine, February 6, 2000, p. 50.  Oddly enough, the old Soviet Union produced an awesome amount of medical discoveries, including special techniques for dealing with ill-formed and broken bones.  We did not absorb its knowledge during the Cold War.

18. Japan is Y2K
In "The Japan Syndrome," Paul Krugman (The New York Times, February 9, 2000, p. A29) tries to divine why Japan's economy is still in bad trouble. The huge amount of infrastructure spending  -- public works -- has not  worked.   First, he finds, the economy has not really been reformed -- more deregulation and break-ups have to occur.  Second, Krugman says the Bank of Japan has not done breakthrough moves to restore liquidity.  Japan, much more than Europe, is the black hole in the world economy.  The Asian crisis is not really over.  Krugman probably does not know the cure for Japan, but he ably points out that the country is a severely flawed system.

17.   Control and Out-of-Control
We are beginning, just beginning, to get control of our homes.  If you will pay up the price, you can control and pre-program the pool temperature, TV programs, illumination, security.  "Americans just spent an estimated $727 million on central home controllers in the past two years . . . ," but that still gets at less than 1% of all homes.  (See Cigar Afficianado, pp. 160-168, "Home Smart Home").  Soon enough we will get at the impurities (pollen, dust, bad recirculating air) that horribly affect the lives of millions of families.  Except, like all electronics in the age of Y2K, the systems are amok.  (See "When Smart Houses Turn Smart Aleck," The New York Times, January 13, 2000, p. B1.)

16. Update: Celera Database 90% Complete
On January 10, 2000, Celera Genomics announced that it has a DNA sequence in its database covering 90 percent of the human genome. It expects to complete the work by the end of the year.  Then the task begins of fitting all the sequences together.   The U. S. Government's Human Genome Project will complete its first big stage by the spring.  These and associated genome efforts are expected to relaunch the biotech sector.  See The Wall Street Journal, January 11, 2000, p. A2, "Celera Pledges Human Genome Map by Year End."  (See also entry #1 below.)

15.  Entrepreneurship, Innovation, and All that Jazz
We've long contended that politics, geography, and social arrangements have as much to do with economic vitality as capital, labor availability, university concentration, and all the usual suspects in economic development literature.   Several groups (Washington-based, unfortunately) rank the states against a wide set of criteria, and with widely varying results.  The CFED (Corporation For Enterprise Development-- http://www.cfed.org/new1.html) does an annual report card on the states.  Its entrepreneurial report card does not bear much resemblence to the "Small Business Survival Index" of the Small Business Survival Corporation (http://www.sbsc.org/pr/nwsrls4.htm), although interestingly some states show up in the Top 10 for both that are not on the usual lists for start-up capitals, such as Florida, New Hampshire, and Nevada.  With more imagination and less axe-grinding, we suspect that a think tank outside the Beltway could find out how regions become good incubators.  Interestingly, all three states are escapist destinations from taxes and urbanism.

14.  News Becomes Old Hat
The TV news magazines are troubled.  See "Coming Up Next, Viewers Flee News Magazines," The Wall Street Journal, December 7, 1999, p. B1.   Newspaper circulation, meanwhile, continues its long decline, down 0.7% for the 6 months ending September 30, even though large properties, in this consolidating industry, show some gains.  Despite all the lurching about, the media organizations still have not done the overhaul of product and distribution mandated by the fragmented markets they serve.

13. Expanding GDP: Shrinking Standard of Living
Redefining Progress, a San Francisco think tank, has its own national index--the Genuine Progress Indicator.  Essentially it has been stagnant since the 1970s, even as our GDP has steadily soared.   It captures the GDP with adjustments for the social costs of population, pollution, crime, and family disintegration.  What most drags this number down is pollution, income inequality, and foreign trade deficits.  No matter how you cut it, we learn that the typical national income statistics we are using do not present a clear picture of our economy or our society.  See Business Week, December 20, 1999, p. 10.  We believe forced rankings of the individual states according to several criteria, will better tell us how the country is doing than national statistics. 

Addendum:  James Tobin, the Nobel laureate in economics, gave birth to a hoard of ideas that populate our thinking today.  He taught up that GDP numbers may be going up, when the real GDP is shrinking.  “Working with a colleague at Yale, William Nordhaus, he was among the first to adjust GDP figures to reflect the true costs of environmental degradation as well as of traffic congestion and crime.”  It is this difficulty that plagues so many of our accountings:  we don’t capture all the real costs.  And, on some occasions, we don’t look at all our asset values, throwing our balance sheets out of whack.  See the Economist, March l6, 2002, p. 78.  Tobin died on March 11th.

12.  Murphy's Law by Perrow
This is a big idea if not terribly original.  Charles Perrow, in his 1984 book, Normal Accidents: Living With High-Risk Technologies, just re-issued by Princeton University Press, essentially says that when systems interact funny, unpredictable things happen.  On a good day, the proximity of several very complex systems leads to disasters.  As a friend of mine once said to a lady at a party, having sprayed her with champagne, "That kind of equine elimination is just gonna happen."   What's interesting about this is that we are taking away much of the flexibility, and many of the redundancies in many systems that prevent "normal accidents."   See Lawrence Zuckerman, "Is Complexity Interlinked with Disaster?: Ask on January 1" The New York Times, December 11, 1999, p. A26.

11.   Germ Renaissance
Philip Ross at Forbes Magazine (See "Do Germs Cause Cancer?"-- Forbes, November 15, 1999, pp. 194-200), tells how a whole raft of diseases--heart disease, cancer, even schizophrenia--may stem from germs and viruses.   In 1983, H. Pylori was discovered to be the source of most ulcers, and papilloma virus the cause of cervical cancer.  Now microbes, rather than genes or the environment, are becoming suspects in a litany of diseases.  The more things change, the more they remain the same.

10.   Harry Potter Beats Teachers
Out of England comes the very best-selling Harry Potter, with three volumes so far -- Harry Potter and the Sorcerer's Stone, Harry Potter and the Chamber of Secrets, and Harry Potter and the Prisoner of Azkaban.  Passionately read by youngsters and found in the briefcases of businessmen in the first class cabins of airplanes, Harry Potter speaks to how a lad can overcome the terrors and confusions of a mythic world (which is just a metaphor for the tensions, anxieties, and anti-child strains of our developed world at the millennium).  J. K. Rowling, the author, who has emerged from down-and-out times with the revenues from these books, says that she has written here the kind of book she would like to have read at age 10.  Several schools have banned the books on the grounds that they encourage a belief in witchcraft.  But children, in the hundreds of thousands, read on--in literate revolt against some schools and adults whose teachings are not answering their educational or emotional needs. 

9.  Let's Get Small
In Steve Martin's heyday, he used to do skits advising us all to "get really small," instead of getting high.  At an ever increasing rate, the world of electronics is producing smaller everythings that promise increased reliability and functionality at prices Scrooge could bear.  Martin Schlecht at MIT has designed new power supplies that are smaller and cooler, spitting out less volts than anything on the market, at his company SynQor (http://www.synqor.com/).  This will be a vital ingredient in the next generation of PCs.  H. Shrikumar, a student at The University of Massachusetts, has tooled a web server 1/4 inch square that costs half a dollar (see "As Small as a Match Tip, This Server Costs 49 Cents," The New York Times, August 19, 1999, D3.)  Also see http://ccs.cs.umass.edu/shri/ipic.html).  Numerical Technologies (Numeri-tech) in San Jose, CA, has developed phase shifting techniques to make chip circuits tiny enough to get to the next level of semi conductors (see The Wall Street Journal, August 12, 1999, B9--"'Tricks with Light' and Chip Miniaturization").  Every revolution, it seems, is based on a countless series of small improvements.

Meanwhile, the next generation of computers is under way, where the smallest components will be a single nanometer, one-hundredth the size of today's tiniest.  This threatens to turn the computer chip industry upside down.   Research in this realm has sprouted up all over, to include UCLA, Hewlett-Packard, DADA, MIT, Yale, Rice, and Mitre Corporation.  See The New York Times, November 1, 1999, pp. C1 and C4, "Computer Scientists Are Poised for Revolution on a Tiny Scale," or click here to read online.

8. Running Out of Workers
Peter Drucker and others have suggested that we will be hurting for knowledge workers in the developed nations.  This will endure past the present boom period in the United States.  Certainly we and others need to extend the retirement age--perhaps even to 70; this will bail out our health system as well.  But, even more, we have to revolutionize our educational system, because we are lacking cyber minds as well as young bodies.  And we need to export more work, including knowledge work, to India and China.  "Empty Isles Are Signs Japan's Sun Might Dim," by Nicholas D. Kristof, The New York Times, August 1, 1999, paints some of this picture for us. 

7. Turning Industries Upside Down
Clayton M. Christensen, associate professor at Harvard, has written the season's most important business book--The Innovator's Dilemma (Harvard Business School Press).  He thinks there are a lot of technologies begging to be put to work, that big companies won't sponsor, because it will destroy their current franchises.   So entrepreneurs have to get the deed done.  Joseph Schumpter called this "creative destruction."  For a quick look at how this will revolutionize some industries, see Business Week, July 26, 1999, p. 6.  

6. Neo-Platonic Cults
Falun Gong (or "Buddhist Law")  may have millions of adherents in China, and it much worries the central government. Its exiled founder, Li Hongzhi, seems to be camping out in New York City.  It blends Buddhism, meditation, and Chinese exercise plus a pot pourri of other loose strands.  As in ages past--at the end of more rational periods--we see a flood of global mystical cults with a very assorted philosophical stew that threatens to rock established systems.  The difference today is that the cults have links around the world, never confined to one region for very long.   See The New York Times, June 29, 1999, p. A4. 
Also see http://www.nytimes.com/library/world/asia/062999china-religion.html.

5. Deflation
Now, several years into the deflationary cycle, born of excess capacity and poor financial habits, we begin to see articles on falling prices.  See "How to Live With Falling Prices," The Economist, June 12, 1999, pp. 57-59. (http://www.economist.com/).  There's some argument as to whether it's truly deflation--or just flat prices.  But the consequences are big, enduring, and strategically revolutionary for corporations.  It's simply hard to grind out growth or to produce profits without degrading products and services.   Deflation plus auctions over the web promise to erode premium pricing in certain geographic niches.  Innovation, rather than me-too marketing, turns out to be the key both to survival and to growth.

4. The End of Nantucket
Nantucket has been invaded by a host of Lyme Ticks and too many investment bankers.  A local writer feels that the island has caught Grand Caymans Disease, where tourism is on the decline.  There's no housing for summer help; you can spend $50 for dessert and coffee at one high-end clip joint; and all around you are people with attitude.  Long-time local friends--from postmen to barbers to librarians--are worn out, trying to make ends meet.  The restaurant food, which had been improving, is fading again.  Oh, when Arcadia turns into anarchy.  Eight years ago, an upper-crust local told me he was never coming back.  That was a bit early to despair.   But now the end is nigh.  This outrageous bull market has created yet another ghetto for the overstuffed whales, like East Hampton.  We will not tell you where we're headed next.  But this is a further sign of a world that kills leisure with abandon.  See "Welcome to Nantucket: Keep Out," by Joseph P. Kahn, The Boston Globe, June 22, 1999, p. E1. To read online, click here.

3. Cellular Neural Networks or Cellular Non-Linear Networks
These are not neural networks, but something different. Scientists from Berkeley to Hungary have teamed together to make it possible to translate complex visual images to your computer screen on a real-time basis. This involves a mix of algorithms, special new microchips, old-fashioned analog computers, and linkages to the digital world. The applications include everything from night vision to medical imaging. See The Economist, March 6, 1999, page 74, "Analogue Computing Looking Good." For more data, contact Mr. Philip F. Otto, TeraOps, e-mail: otto@teraops.com.

2. Patient-Friendly Information on Critical Diseases
Health costs are still rising and the quality of patient care continues to decline. The whole effort in the patient information systems area promises to break this Gordian knot. Particularly the offerings from Fairview Medical. Its Health Dialog taps the best clinical database in the country, putting the information in patient-friendly form and delivering it to the patient in a variety of ways. Fairview works through large healthcare groups to make its service affordable and usable by patients with critical problems. It believes that fully-informed patients with the best data will make the best medical decisions, raising the quality of their care as well as averting unnecessary costs and procedures. To read more, see The Wall Street Journal, April 22, 1998, "New Videos Arm Patients With Power of Information." For more information, look at Fairview's website at http://www.healthdialog.com/.

1. Gene Sequencing
The race is on. The government is trying to do a gene map of our bodies in its Human Genome Project at the National Center for Human Genome Research. Meanwhile, Celera Genomics, part of Perkin-Elmer, led by J. Craig Venter, is seeing if it can beat the Government to the punch. When this is done, drug companies will be able to invent drugs that target diseases more forcibly while avoiding many of the side effects produced by our current batch of drugs. All our treatments for cancer, for instance, are still terribly crude and will be until we truly have drugs with biotech bite that will clobber errant cancer cells. We're finally doing in the gene world what we did in the 1930's and 1940's in the atomic world.

This race indicates that we need more competition in scientific research. And asks us to figure out what R&D gets done best by the government/university complex as opposed to private skunkworks. It's not clear. Many, many developments only get off the ground under government auspices, but the pace is always a bit slow. How do we get our governments to develop their own limited-life skunkworks? To read more, see The Wall Street Journal, March 11, 1999, page B5, "Gene-Sequencing Race Between U.S. and Private Researchers is Accelerating." For more, see Perkin-Elmer website at http://www.perkin-elmer.com/.

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