Real economics update

There is no shortage of news from the Predator classes these days.  I can be distracted by the media coverage of which foaming barking moron the Republican party will choose as its standard bearer.  My favorite, of course, is Michele Bachmann because she is such a perfect example of what Jane Hamsher calls Supermodel Stupid.  See men, this is what you get when you nod sagely at every idiocy that comes from the lips of a gorgeous woman because you don't ever want anything to ever get in the way of your possibility of getting laid.  And the political men surrounding Bachmann are probably especially solicitous because her husband is so obviously gay.

And then there is the news that there is corruption on Wall Street.  Well duh!  We actually try around here to give that subject the coverage it deserves but it since this news is merely a validation of our primary theme which is, "Thieves are badly qualified to manage an economy" we DO attempt to ignore the cops and robbers aspect of the story.  And in truth, the idea that moneychangers are crooks is about 5000 years old and the current details of this truth are not especially interesting.  The only interesting question is what do the rest of us do about them.


Anyway.  There ARE interesting people doing interesting things so even though these stories are not especially related, they are worth noting.

Discussions of energy use, unfortunately, rarely get to the most obvious issue--land use.  And one can only imagine poor Veblen watching a lawn tractor commercial because he saw the growing popularity of "greenswards" as a perfect example of his concept of conspicuous waste.  Unfortunately, this is precisely the form of waste that must be eliminated when Peak Oil occurs.  Unfortunately, it will be, by far, the most expensive form of energy waste to be addressed.

Ultimately, energy efficiency is a function of DESIGN 

Design is often confused with decoration because the word is often misused in just that way. This is also the word engineers who in are the business of specifying a heating system for new building must use to describe what they do. 

In between the decorators and the engineers are the industrial designers who argue that while good design is aesthetically pleasing, it must incorporate a deep human understanding to increase functionality. The focus on design when the question is energy efficiency has one overwhelmingly important reason--it is almost impossible to change the energy efficiency of anything that requires energy to operate ONCE IT HAS BEEN BUILT. 

Think about a television set. It requires x watts to run and probably a few watts when shut off. The ONLY way lower energy consumption is to watch it less and unplug it when shut off--you cannot change how many watts it requires when running. Since energy efficiency is a measure of how many watts it takes to operate, you cannot, by definition, change the energy efficiency of a television once it has been manufactured. Unfortunately, this principle also applies to bigger consumers of energy as well. 

That big ugly SUV your neighbor bought when gasoline was 99 cents a gallon will continue to get 8 miles per gallon until it is ground up for scrap. 

Houses can be retrofitted for better energy consumption but such a project is very expensive, requiring costly parts like triple-glazed windows and fussy, labor-intensive efforts like re-insulation. Because such projects are so expensive, they almost never pay for themselves in energy cost savings. And so they don’t get done very often and those who would do this sort of work, never get the chance to improve their skills. 

Probably the most significant contributor to increased energy consumption in USA over the past 50 years is urban sprawl. This is a problem that no drive to increase energy-efficiency is likely to solve because the only way to increase the energy efficiency of a city once it has been built would be to move buildings around. 

In fact, about the only category that can change its once manufactured energy efficiency are light fixtures--and then only some of them. This special case is made possible because the part that actually consumes the energy--the bulb itself--is a part that is designed for routine replacement. However, even here, MANY fixtures will only accept a bulb identical to the one originally installed. more

Setbacks, Suburbs and the American Front Lawn
SUNDAY, MAY 15, 2011 

From an old Michael Pollan essay comes more support for the idea that the mandatory residential setback, featured in the previous post, owes its origins in part to the 'pastoral' landscape aesthetic championed by such men as Central Park-planner Frederick Law Olmsted: 

"If any individual can be said to have invented the American lawn, it is ... Olmsted. In 1868, he received a commission to design Riverside, outside of Chicago, one of the first planned suburban communities in America. Olmsted’s design stipulated that each house be set back 30 feet from the road and it proscribed walls. ... In Riverside, each owner would maintain one or two trees and a lawn that would flow seamlessly into his neighbors’, creating the impression that all lived together in a single park." 

Pollan's essay is about the historic and cultural significance of the American front lawn, not the American residential setback, but the two are in many ways inseparable. As Pollan shows, the intent of the setback at the outset was to mandate a grassy front lawn, whether it was wanted or not — either cost, social pressure or concerns about resale value will tend to discourage creative alternatives to the bluegrass turf rolled out, for one's convenience, by the developer. And what is the expense required to maintain all of this yard space? 

• $40 billion spent annually on lawn care
• 800 million gallons of gas annually for lawnmowers (not much compared to cars, however)
• 25 hours per year spent on lawn care by average homeowner
• 21 million acres (an area the size of Maine) devoted to home lawns. 

The contribution to low-density growth should be self-evident.While other countries routinely incorporate lawns into their detached single-family neighborhoods, it appears to be only England's colonial children — the United States, Canada, and to a somewhat lesser extent, Australia, New Zealand and a handful of other places — that have embraced the idea of large, decorative and open front lawns. more

The idea that we should be doing something about our real problems show amazing public support.  No wonder these options are never part of news coverage.

Manufacturing Alliance Issues Wake-Up Call to Washington
By Kenneth Quinnell   August 05, 2011

Voters are much more focused on the economy and jobs than they are on the deficit and debt, and they see manufacturing as a key component of improving the American economy. Those were among the key findings of a national poll and focus groups conducted on behalf of the Alliance for American Manufacturing. Poll respondents said they believe that manufacturing is "central and irreplaceable" in determining the strength of the economy of the United States. The results show increasing support for U.S. industry, growing concern over China's role in our economy and a strong sense that no one in Washington is doing anything to improve the job situation. Nearly 90% of Americans favor a national manufacturing plan that includes "Buy American" provisions, that cracks down on unfair trade practices by countries such as China, and that includes incentives for research and development. 

The AAM said the purpose of the poll was to send a "wake-up call" to Washington. In particular, the organization points out that Republican leaders (and to a lesser extent, Democratic leaders) are significantly out of touch with their constituents. The polling showed consistent results across party lines and including the majority of tea party-identified voters. Representative quotes from voters in the focus groups were: "We become a third world country if we lose manufacturing" and "The playing field isn't even, China is cheating." 

Other key numbers from the poll:

-When given an “either/or” choice, just 29% want Washington to focus on deficit reduction while 67% favor job creation.
-Less than a third (32%) believe the U.S. is the world’s strongest economy, with the plurality (39%) saying it is China. Yet, 88% believe it is possible for the U.S. to have the strongest economy in the world and 95% feel that it is either very or somewhat important.
-“Creating manufacturing jobs in the U.S.” and “strengthening manufacturing in this country” are the top voter priorities for the President.
-Only 50% of voters believe that the President is working to create manufacturing jobs – an 11% drop from 2010. Congress fares even worse – 41% say Democrats in Congress are working to create jobs, and 32% see the GOP working to create jobs.
-90% have a favorable view of American manufacturing companies – up 22% from 2010.
-97% have a favorable view of U.S.-made goods – up 5% from 2010.
-32% identified manufacturing as the “most important” sector for our economic strength – surpassing all other sectors by a wide margin. 54% identified it in their “top two.”
-62% say that that manufacturing is a “critical part of the American economy” and reject the view that high-tech and services will replace it.72% have an unfavorable view of goods made in China and 83% have an unfavorable view of companies that go to China to manufacture.
-86% favor a national manufacturing strategy “to make sure that economic, tax, labor and trade policies in this country work together to help support manufacturing…” – up 8% from 2010.
-87% see a role for government in supporting manufacturing – 49% say “whatever is necessary” and another 38% for limited role of “incentives, and trade policy.”
-94% support a tax benefit for companies that conduct R&D in the U.S. and make their new products here.
-91% support increasing investment in “retraining and education programs to ensure workers gain the tools they need to compete in modern, high-tech factories – up 4% from 2010.
-90% support Buy American policies “to ensure that taxpayer funded government projects use only U.S.-made goods and supplies wherever possible.”
-90% support tax incentives for companies that “invest in new equipment and plants for manufacturing.”
-89% support investing “more in rebuilding and repairing bridges, roads, and other basic infrastructure.”
-95% favor keeping “America’s trade laws strong and strictly enforced to provide a level playing field for our workers and businesses.”
-59% say we need to “get tough with China and use every possible means to stop their unfair trade practices…” – only 34% say we need to “be careful…because they own such a significant portion of our debt.”
more

And folks!  Rebuilding America's infrastructure will take more than money.  It's amazing how bad were have gotten with this infrastructure thing after only a generation of official neglect.

Did Amtrak Buy Bad Trains for the Northeast Corridor? 

August 10th by Eric Jaffe

The recent calls for government spending cuts haven’t stopped Ray LaHood from being in a pretty giving mood. Yesterday the Transportation Secretary awarded California $179 million for passenger rail. Most of that money — roughly $86 million — will go to the first segment of the state’s high-speed rail line, through the Central Valley, the cost of which may jump by billions after the release of a new environmental report. 

But another $68 million will go toward what the department calls “next-generation American-made trains”; in this case, that means four locomotives and 15 bi-level rail cars. The equipment money is part of a larger, $336 million award announced last week. California will share the pot with four Midwestern states (Iowa, Illinois, Michigan, and Missouri) that will use the remaining $268 million to purchase seven locomotives and 48 bi-levels. 

That’s a lot of trains. But not nearly as many as LaHood secured for Amtrak in late June, when he issued America’s passenger rail operator a nearly $563 million loan for 70 locomotives to run in the Northeast Corridor. (Of the total loan sum, only about $466 million will go to the engines themselves, with the rest going toward maintenance and spare parts.) According to the department release, these high-performance, energy-efficient electric trains will be built by Siemens at several U.S. plants. LaHood hopes the trains can hit the tracks by 2013. 

Sounds like a good thing, especially considered many Amtrak locomotives are decades old. But some aren’t so sure. At his Pedestrian Observations blog, regular Infrastructurist commenter Alon Levy argues that Amtrak is getting below-average trains at an above-average cost. 

Not only have similar locomotives recently sold in Europe for substantially less, writes Levy, but the new Amtrak fleet is being rushed into production just two years before an updated safety mandategoes into effect that will enable the purchase of lighter — and cheaper — trains. 

Stephen Smith of Market Urbanism, now writing for Streetsblog, suggests that Amtrak should transition away from locomotives entirely in favor of electrical multiple units (EMUs), which are“in line with best practices in Europe and Asia”:

EMUs are, like subways in the US, individually-powered carriages, and standard models can be as cheap as the inflated price that Amtrak pays for its unpowered passenger railcars. The locomotive purchase locks Amtrak into buying more of these unpowered carriages in the future, making Amtrak’s decision to go with locomotives all the more important. 

In other words, if Amtrak is to weather these fiscally lean times, it has to improve its ability to do more with less. Its alternatives are raising ticket prices or cutting service, which could hurt its healthy market share, or perhaps ceding control to the private sector, which has not worked well in the past. more