Other peoples money

Disclaimer: I'm not socialist or conservative but I do defend both of these points of view. Obviously most systems in Europe are a strong mixture of both. But this post does deal with politics-led economics, concluding that it's all based on bad dogma.


Margaret Thatcher famously said, “The problem with socialism is that you eventually run out of other people’s money.” Now Thatcher was sometimes right and sometimes wrong but mostly she didn't have a clue what she was doing from one moment to the next. However that was actually an essential part of her credo. She like Reagan, believed that government can't possibly ever do anything right so we need to leave the free-market to try to solve everything by using a hands-off approach. She lived up to both parts of that credo. Let's reflect on what she achieved impartially:


Good parts;
.Reduced inflation to record lows,.
.Controlled the trade unions, who had previously been totally destructive.
.Deregulated the credit process. Eventually this led to cheap credit. The engine of economic recovery must start with cheap credit surely.
.She was right that the tax regime was barmy. By reducing the top tax she actually got more overall tax revenue.


Bad parts:
.Inflation reduction was achieved by massively increasing unemployment in a very bad recession where Britain lost virtually all of it's traditional manufacturing base; ie the thing that made Britain rich in the first place. Workers were too afraid of being out of work to strike. One might ponder which situation is better; the slow stagnation effect of the left or the rapid descent and start again effect of the right.
.Actually making things and selling them was replaced by the city of London selling reams of worthless paper. Boom and busts were made worse. The cheap credit led to a housing boom because flipping a house was more profitable than working and sometimes the only alternative in a job-free marketplace.
.Homelessness rocketed upwards.

Other stuff she did was probably a net zero. She didn't control public spending but in fact increased it largely because of all the extra unemployment benefit. Much of Britain's GDP recovered largely due to North Sea Oil revenues, most of which was squandered and which is now running out. Nuclear power was stopped but replaced by natural gas power. While she reduced the income tax, she massively increased VAT and introduced a whole slew of other taxes -  a practice which Blair/Brown copied.

Blair of course used Thatcher as his role model, with no intention of moving back to an industrial Britain. The phrase "metal-bashing" came to replace the word "engineering" in governmental circles which illustrated the utter conptempt the political classes held for it. In Blair's government, most of them had never done a real job - they were politicians straight from college. John Major was a kind of stop gap middleman between these two larger personalities. So it's fair to say that what Britain has now is due to Thatcher rather than Blair - for better or worse, depending on your dogma.

But back to the original socialist put-down phrase "other peoples money". Now you might be thinking, like me, that it's capitalism that seems to rely on other peoples money rather more than socialism. And you might even notice that "eventually running out of other peoples money" is a perfect description of the current financial crisis. But it gets even odder than that. The US and the UK, the followers of Thatchers faith, grounded as it is in the utopian Chicago economics* of regulation-free markets and rational decision-makers, are the ones in deep debt and they got most of that debt from the most socialist regime on the planet who just happen to have all the money now: China. Oh irony of ironies! Another irony appears by realizing that China got all that wealth by building and selling things - just like Britain had! Lesson learned? Not yet it seems!


*You know the crowd - they used Smith's mere metaphor of an "invisible hand" as a godlike doctrine. One presumes this is a reflection of our soundbite world where a phrase has more meaning than an entire book. Clearly none of them actually even read Smiths book.

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End qwerty domination!

A perfect example of an innocent early design mistake becoming important later:-
The qwerty keyboard was originally introduced to slow down typists because they were too fast for the first typewriter mechanisms to keep up. Yet it's still with us, even for computers used largely by two-fingered typists. This is where standardization can lead us (except for the French who, always striving to be just a little different, chose to use an azerty* keyboard instead). Yet there was a chance to change it when mobile phones were used for texting. Nobody who uses their thumbs for typing would want to use anything other than an alphabetic system. Alas now we have full keyboards on our phones though we still need to use our thumbs and --aaaargh! ---they are all qwerty. The only remaining hope now is that we get an option to change the touch screen keyboard to alphabetic. That would be really easy to do I imagine. Is there one?

*I had to change my French azerty for a Spanish qwerty. It wasn't so much the qw/az confusion (bad enough) but the numbers at the top: The French use the shift key for typing numbers while the rest of the world can type a number with just one touch. So frustrating... The Spanish keyboard bridged the Franco/Anglo divide and gives me all the funny keys I need too like ñ and Ç. So Spanish is not only easier spelt and easier pronounced but also easier typed.

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Climate model sensitivity

Glad I am to report that at least one influential non-skeptic thinks that the accepted climate sensitvity to CO2 is very overblown. Skeptical in this case largely refers to Richard Lindzen, Roy Spencer, and other climatologists who think the IPCC is overly alarmist in it's projections. Oddly non-skeptical conventionally means that you accept the IPCC report. But a little known fact is that you can accept the IPCC report but prefer the lower projected increase in temperature of 1.1K per doubling of CO2. Yes that is allowed - it's called being a lukewarmer. And in that case to be skeptical is to reject the alarmism that appears only in the newspapers but not in the IPCC documents. A sensible position to take in other words.

Anyway, this next bit is lifted wholesale from another blog called MasterResource, run by Mssrs Bradley and Knappenberger and is here to remind me, or anyone else reading this, that mainstream users of climate models distrust them almost as much as the skeptics:

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"Jerry North (Texas A&M) Hints at the Problem

Eleven years ago, when I was director of public policy at Enron, I entered into a consulting agreement with Gerald North, Distinguished Professor of Atmospheric Sciences and Oceanography at Texas A&M’s Department of Atmospheric Sciences, to tell me what was going on. North was as close as I could find to a ‘middle of the roader’ between climate alarmism and (ultra) skepticism. He is alsohighly decorated.

And this has not changed. North’s own intuitive estimate of climate sensitivity is now 50% below the IPCC’s best guess, and he has been critical of a number of the climate mini-alarms that would make headlines and then fade away (more hurricanes, disruption of the thermohaline circulation, etc.).

But I noticed a Malthusian streak in North, that unstated assumption that nature is optimal, and the human influence on climate cannot be good but only bad–and maybe even catastrophic. Still, North in his emails to me–then and now–was rather blunt about the shortcomings of climate modeling.

Here is a sampling of quotations over the last decade:

“There is no doubt a small ‘sociological convergence’ effect, that tends to work here (individuals and their managers hate to be the outlier). The biggest problem is that doubling CO2 leads to a 1 deg C warming (I think even Lindzen agrees). If water vapor doubles it, we are at 2.0 (Lindzen differs here, but I do not know of anyone else). Are there any other feedbacks? It is hard to dismiss ice feedback, but it might be small. Clouds are positive in most models — I have always taken them to be neutral, but with no substantial reason (it’s just easier that way).”

“I do not think there is enough thinking going on. Just plugging in the numbers or running the simulations. Dick [Lindzen] is clearly right on this one.”

“I believe the ocean simulations are very primitive and quite variable from one group to another. The underlying reason is this: How much of the deep layers of the ocean are really participating in the warming?”

“There are pitifully few ways to test climate models.”

“[Models] sort of fake it (we call it ‘parameterization’). They do it in very crude ways such as if the temperature profile of the atmosphere is unstable, they make the whole column overturn, etc.”

“[The models’ treatment of feedbacks] could also be sociological: getting the socially acceptable answer.”

“I go back to my old position: we need more time, maybe a decade to get a better grip on aerosols, water vapor feedback, cloud feedback, ocean participation.”

“We have only a very loose grip on aerosols.”

“[The models] treat the ocean differently. Somehow, they are fudging the parameters that govern ocean coupling so that they get the right ocean delay to agree with the data in spite of their differing sensitivities.”

But before you call North a radical or tattletale on the ‘consensus’, consider what the IPCC said in the back of their latest assessement of the physical science of climate change:

“The set of available models may share fundamental inadequacies, the effects of which cannot be quantified.”

 - IPCC, Climate Change 2007: The Physical Science Basis (Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change). Cambridge, UK: Cambridge University Press, 2007, p. 805.

Is this a trick? Satisfy the science by stating the science–but do so on page 805 rather than in the executive summary where it belongs. It is this sort of thing that Eric Berger–and other open-minded middle-of-the-roaders–are going to find out. And they just might feel a little duped."

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So OK, North leans towards 1.5K as a likely number, rather than the "official" 3K. Actually the official stance is 1.1 to 6K but everyone just takes the middle of the range as if it was a Gaussian distribution  (it isn't - all numbers higher than 1K are decreasingly scientifically plausible as North admits above - but of course the IPCC like the hoi polloi to assume it's a Gaussian). I've no problem believing that many more scientists think the same way as North but they just don't shout about it in the same way as Lindzen because it's just not politically correct to do so. Not everyones tenure is on such a sound footing as Lindzen, and Spencer actually had to resign from NASA in order to state his skeptical views.

I've noticed that Mathusian streak in a lot of the debate though - particularly on Andy Revkins blog. Overpopulation is a problem easily resolved by allowing 3rd world women some education, some independence and the right to work. All of which arrives with prosperity - which in turn is just possibly dependent on cheap, available energy. Ah...there's the rub. As they said on Spiked magazine though, Malthusians have always been wrong about the limits to growth and the real problem likely isn't too many people, it's too many Malthusians.

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The car of the future

A while back I wrote that I didn't rate the internal combustion engine much. Ever since I did a project on gas turbines I've been wondering why the gas turbine car was stillborn. The advantages are so numerous but mainly the idea of using rotary motion rather than converting reciprocating motion is the killer. It makes everything else so much simpler. The pistons in an IC engine are actually based on a cyclists legs.Why then, I've often asked myself, do we push down at top dead centre (TDC) rather than at 10 past the hour as we do on a bike. Actually the answer is probably because it was always done that way, or because of space. I did find out that the new air car by some French inventor does push down at 10 past the hour and increases the efficiency by about 40%. ie as we've seen so often, when you are limited then you are forced to find a solution. That may be the ethos of the idea behind carbon limitations too. After all, high fuel prices in Europe forced the development of small Diesel engines.

Anyway, rather than have minor improvements to fundamentally silly technologies, why not go back to the drawing board? And somebody has:

http://www.globenewswire.com/newsroom/news.html?d=179151

Sweet looking, fast series hybrid using a Diesel microturbine to charge batteries that run an electric motor. Actually it's not so new. Jay Leno has a car with similar technology in his garage from earlier this century. http://www.popularmechanics.com/automotive/jay_leno_garage/4215940.html 

"The Owen Magnetic. First seen at the auto show in New York City in 1915 ...has a gas engine and an electric generator. 

This drivetrain was the brainchild of George Westinghouse. The engine powers the generator, which creates a large magnetic force field be-tween the engine and drivewheels. There's no mechanical transmission. The driver moves a rheostat through four quadrants — a lot easier than shifting, and grinding, the straight-cut gears of the day — and the car moves ahead progressively, giving occupants that odd feeling you get when you try to push similar-pole magnets against each other. Both Enrico Caruso and John McCormack drove Owen Magnetics." 

And of course electric trains use this drive concept too. However, microturbines weren't available recently. I don't know why; the microturbine is almost an exact replica of the Rover turbine that I tested in 1982 and which was made in 1953. I presume it's the air/foil bearings that make the big difference.

Anyway, "0-60 mph in 3.9 seconds, 150 mph top speed, and an unheard-of* driving range of up to 500 miles on a single tank of fuel, all with ultra-low exhaust emissions that rival any hybrid on the market today"

Somewhere I read about 500 mpg but maybe that's pushing it. A nice target though! We do know that the buses/coaches that use this technology are twice as economical as diesels - and a whole lot quieter, cleaner and smoother.

*Well it might be unheard of in the USA but the new Diesel Jaguar can achieve 1000miles on a single tank - as proven on Top Gear "Basle to Blackpool on a single tank" challenge.

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Beware of fitness fashions; short term gain = long term pain

Oh no, not another skepticism confirmed. It's a bit depressing realising that skepticism about any fashionable idea is usually always justified. Another one I've just read about is high impact aerobics and step aerobics. The unfortunates who did it in the 80's all have arthritis now:

http://www.cbsnews.com/stories/2007/08/27/earlyshow/contributors/emilysenay/main3207440.shtml

I'd had an inkling of this because a friend who was a radiologist in the 80's kept saying that joggers and marathon runners were causing a huge upsurge in knee problems. Funny how many people have knee problems isn't it? My own knee pain arose largely from playing football. Though I admit it was mainly people kicking me after I'd dribbled past them but I also have a suspicion I'd screwed my knees up by those ever-odd stretching exercises and the continuous impact pounding. Now that I've largely given up all exercise (apart from walking a fair amount that is) my knee has completely healed. It took a long time mind you, but finally, no longer do I get these sudden, excruciating pains when I put pressure on it.

Isn't it also odd the number of fitness freaks who succumb to heart attacks? My cyclist neighbour has just succumbed too. The conventional wisdom was that exercise was good for the heart. But the heart is a muscle and you can strain it. Good grief, the Queen mother lived to 100 without doing apparently any exercise at all.

The secret then to good health and a long life? Eating well and walking rather than running. Ask the French!

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Green programming

In my tradition of nabbing useful comments - largely as a diary. I've got one from "TheRegister". The original question is why do we need a full copy of Windows in every VMWare virtualization session, ie can't we just share the OS code because 40% of the server is being used up in dealing with this bloat. Well all the obvious answers were there; by using Solaris Zones or FreeBSD Jail then you can but then you don't have Windows. It goes back to the code bloat theme and someone called Captain Thyratron et al  summed it up in a rant:

"Solaris Zones/Containers are pretty good (speaking as a self confessed Solaris fan). Though last time I looked they didn't support migration of a live VM from one machine to another. So pluses/minuses both ways.

Of course, the best thing is to have a self-clustering app that doesn't need something like VMWare to give it resiliance, etc. et. You could run such an app natively on a series of hosts in their nice multitasking operating systems. Now where would I get one of those...

I'm pretty sure that virtualisation is just an excuse for lazy developers to not think about their app design properly. I see developers at my employer doing all sorts of crazy things - e.g. a whole Windows VM just to serve up a 10 page website! Whatever happened to efficiency?

Dear Reg, please can you start a Campaign for Real Computing. Once upon a time programmers were skilled at developing efficient code that ran quick in small amounts of RAM. Now that resources are 'plentiful' the programming community has generally got lazy:

1. VMs where a native app would do.

2. Languages with bloated runtime environments that take forever to load just so you don't have to worry about errant pointers.

3. Apps running as crappy interpreted code in junk scripting languages in browsers just to save the effort of compiling the bloody thing.

4. New thin client technologies that consume vast amounts of bandwidth and give poor results instead of updating perfectly good things like X11.

5. An ever expanding array of app hosting environments (Silverlight, AIR, etc.) that are all 'indispensible' that make machines slow to boot and don't do anything that a carefully written native app couldn't do.

6. Data stored in man readable text when computers learnt to store things as binary a long time ago (come on, who EVER reads XML as the prime means of accessing the data within?).

I wonder how long it will be before data centre managers realise that lazy developers and vendors are costing them huge amounts in electricity, hardware and bandwidth costs?"

So there you have it - and it's true. Bloaty programming has a hardware and energy consumption cost. Ending code bloat is green. Do we really need items 1 to 6? I don't think so. This is why I'm anti code bloat and why someone telling me that throwing hardware at it is cheaper than doing the app right in the first place is plain crazy. It may be cheaper (debatable) but it's wasteful and short sighted.

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Peak Oil Baloney

Well there is a peak oil cult currently exemplified by the worriers at theoildrum.com and their latest post, relying pretty much on a correlation between dollar price and US GDP. Hence to them a high oil price equals low GDP. Hence it's basically yet another "doomsday from resource-limits" cult. Well my comment to that is below:

You may be mixing up cause and effect and oversimplifying. Yes GDP is correlated with oil price but that's partly because in a boom more oil is used and in a recession there is a cutback. While I'd accept that a price spike causes a cutback too, the short-term price spikes of 2007 were really caused by over-buying of futures contracts which then corrected the same year. But the reason everyone was buying into oil was because the debt level became unsustainable, the recession was coming, the stock market was diving and the pension fund managers stupidly thought that commodities were a safe haven. Inevitably the speculation corrected and the oil price dropped. The initial price rise from 2001 had of course been caused by the Iraq war and fears of supply.

Of course, we also have the reality that cheap oil allowed globalization by reducing shipping costs which then caused a slump in Western manufacture, so the Western GDP was then propped up only by rising house prices which were in turn based on cheap debt. And of course an economy that depends on house prices to continually rise is doomed to collapse, which is what happened. So it's all a bit more complex than your simple analysis allows for. In other words, correlation is not causation.

Indeed a higher price may actually be better for western economies because:
a) It makes cheap imports more expensive and allows local economies to redevelop their own manufacturing base, which gives real GDP growth from added value, rather than artificial growth from debt.
b) It encourages investments in extraction or gasification of shale oil and extraction of heavy oil, which are both hugely abundant, as even M. King Hubbert [the originator of the peak oil movement] noted, and which in turn ensures a future supply of oil.

Also perhaps a more important correlation is between the price of gold and the number of barrels it buys, which has hovered around 14 barrels per ounce for a century. So it's likely the variance in the price is more indicative of the value of the dollar than anything else.

Lastly, oil is largely used for transportation and plastics so a reduction in oil would not reduce electrical energy output hence it's not quite as drastic as you suggest. There is plenty of coal and gas to keep the lights on and there are also alternatives to plastics which could be used if plastics became expensive. So it's not all doom and gloom! It really depends on how you want to view things!

But there's yet one more aspect that I forgot to mention there. The fact that world oil is bought in dollars means that every country in the world has to keep a supply, so they buy more dollars as the oil price rises. This allows the US to print more dollars without incurring inflation. It's the petrodollar economy that has propped up the USA since the end of the Bretton-Woods agreement and it basically amounts to the rest of the world giving free money to the USA. This willingness for the rest of the world to soak up dollars is why the USA GDP looked so good and why the debt burden didn't seem to matter to all US administrations since Reagan. In their own words, the growing debt was a sign of confidence in the USA and indeed it was. However that confidence is lost if the dollar tanks. That of course would cause all these foreign dollars to be worthless. Hence the rest of the world are partly forced to keep propping up the dollar or lose the value of their reserves. What a dilemma! China, who hold the largest dollar stash, are coping with this dilemma by buying up all the commodities; metals, oil, uranium that they can get their hands on. Basically they will then not have to worry about any dollar crash and may even be the new hegemony in the world - ousting the USA. The Eastern politicians it seems are a lot more clever than their Western counterparts.

Its much more fascinating when you do real analysis rather than just plotting two curves, noting a correlation and dumbly assuming that A causes B or B causes A, rather than C causing both A and B. More false ideas are spread, and even wars happen, because of this fundamental error than by anything else.

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UK Energy Policy

I'm pretty sure that the UK energy policy is based on faith, hope and charity and very little real action. However, in some senses you can argue that a government with a total lack of engineering knowledge should just keep their nose out. Certainly Thatcher's dreams of a nuclear future were confounded by the reality of commissioning and decommissioning costs and it was largely good luck that natural gas came along at the right time. The gas plants though were not only better than coal and nuclear - simpler, more efficient, cheaper - they were pulled from industry rather than pushed by government. That's an important thing to note as it sort of vindicates the "free-market knows best" idea which has been knocked quite a bit. However the real problem with the free market is that it's too free for the criminals and they then gradually take control and ensure that it becomes less free for everyone else. That's where the regulation is needed. If the regulators are criminals too then there's no hope.

I'm convinced that the UK just doesn't have the money for the nuclear expansion they propose - they are massively in debt. Whatever the government says now they'll have to face that reality sooner or later. Sooner I hope.

So what is the real energy direction going to be? Well I'm increasingly finding that it's a lot easier recycling someone else's words when they agree with you. I thought I was such a contrarian that couldn't happen but apparently I'm not so alone. So I dug this out of the comments section of the oil drum. Again I assume it's public domain. I could have reworded it but that would have been pointless and dishonest. It's by the OMGbyWTF anonymous bot:

"The recession is keeping the lights on at the moment. There are a couple of unusual things happening in the UK electricity market at the moment.

The low price of natural gas and large number of CCGT's seem to to be undercutting the price of coal generated electricity, also there are net electricity exports to France as they seem to have a lot of nukes out of service for various reasons.

http://www.reuters.com/article/utilitiesSector/idUSLU26856720091030

http://www.bmreports.com/bsp/bsp_home.htm

The UK has wasted its North Sea reserves making cheap electricity with no long term investment in alternatives or storage. LNG import capacity has been built fairly quickly and it I don't see the 'gas glut' lasting for very long. I think the UK needs to get its act sorted on several key areas.

Build more natural gas storage facilities.

Improve thermal efficiency in buildings: insulation and move towards heat pumps starting with those on electric and oil fired heating. External insulation and solar water heating should also be considered.

Adopt the Danish model of multifuel CHP systems burning coal, rubbish, biomass and gas whilst providing district heating. Distributed generation running of gassified waste / coal / natural gas / biogas should provide good security and flexibility. Dump the CO2 and waste heat into greenhouses.

Accelerate construction of replacement nuclear reactors and grid upgrades to add more interconnectors with Europe and accomodate more wind power.

Expand and electrify existing railway services.

Look at potential for coal bed methane / gasification of the coal reserves under the North Sea, from a CO2 perspective this may not seem a good idea by this time there should be plenty of empty oil / gas fields to pump the CO2 into.

Build the Severn Barrage, and uprate and expand if possible existing pumped storage sites.

Roll out electric vehicles as they become available."

The only things I don't agree about are a) the nuclear expansion - on mainly cost grounds, and b) worrying about warming from CO2, which in my view is a very overblown hypothesis, though I accept it's politically correct. Using the CO2 for greenhouses or scavenging is however eminently sensible. However all this is cost but no sign of where the money might come from. Stopping the pointless wars would help. Perhaps a Tobin tax? Or just getting entrepreneurs to fund it rather than government. I'm not too happy about that because energy companies are natural monopolies - they really need strict overseers.

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Western manufacture decline

This might be a copyright theft but perhaps opinion on blogs are public domain. Anyway I reproduce verbatim a blog post from Dale R McIntyre, PhD on Andy Revkin's dotearth blog. A blog that seems to be frequented mostly nowadays by realists rather than the wooly-minded Malthusians who used to dominate. Several are admitting now that they don't have quite the same belief that scientists know any better than the rest of us about the state of the planet. However, enough about fantasy science, let's focus on real engineering. This post shows that the USA is now facing the same effects of neo-liberalist de-manufacturing that the UK faced in 1980's. It's difficult to say if it's avoidable or not but it's worth chronicling at least - especially the part about cheap and nasty Chinese cheese-like steel which we've all become accustomed to encountering in household items. When will a major engineering catastrophe occur because of that short-termist thinking?

"Those of us who have tried to manufacture anything here in the US over the last 20 years could explain it to you. The manufacturing skills and enterprizes which led America to prosperity for over two centuries are in a parlous state.

The causes are many but let me detail some of the high points.

In the mid-1990's, China was allowed to join the World Trade Organization with its currency, the renembi, pegged to the dollar and undervalued by about 30%. (For why this was done, you might enquire to the husband of our current Secretary of State, or to Al Gore.)

With an undervalued currency, labor paid at rates on the order of $1.50 PER DAY, no union work rules and no environmental rules worth mentioning, the leadership of China made mercantilism their national policy and export earnings were the order of the day.

American manufacturing firms were soon putting thousands of man-hours of engineering into their proposals, presenting their best, most finely-honed price, only to be told that they had to meet the "China price". That is, unless they cut their best price 30% to match what the Chinese, with their undervalued currency, could do the job for, the work would go overseas. (For documentation please see Business Week and Fortune articles all through the late 1990's and early 2000's)

US firms who met the China price, hoping to keep business and cash flowing in the door, ended up going bankrupt. I believe I am correct that every single major auto parts supplier in this country has been through bankruptcy.

This attack of the "China price" came on top of twenty years of steady erosion of profitability in the manufacturing sector, due to litigation costs, union work rules and the capital requirements of installing pollution control equipment. America led the world in mandating pollution control all through the 1970's and 1980's, at a time when our competitors faced no such requirements. It came at a price; the hollowing out of America's manufacturing infrastructure.

America's steel industry, once the world's strongest, is just a vestige of its former self. What happened? Steel mills had to put their capital into flue gas scrubbers; Asian mills did not. Union wages made America's steel workers the highest paid in the US, paid 47% more than comparable jobs in other US industries. Until the mills went bankrupt, that is.

Every one of those wind turbines will need a tall steel tower to hold it up in the breeze. The Chinese steel industry is now the world's largest, with huge over-capacity, so they sell their steel cheap. It's not very good steel, but boy is it cheap.

Little critical detail items stopped being made here because of high labor costs, the cost of legal liability and the cost of environmental compliance.

Take fasteners, for instance. Big deal, they're just bolts and nuts, right? Well, Boeing is losing customers for their 787 Dreamliner because there are no domestic suppliers of fasteners to hold the wings on, and the foreign suppliers didn't deliver on time.

Every single blade of every wind turbine will be held on by a circle of about 50 high-strength steel bolts. China makes tons and tons of bolts. They are not very good bolts, and a shocking number of them are of cheap low-strength steel but "decorated" with markings to make them look like high-strength steel bolts.

When cheap bolts are installed in a wind turbine they will fail by metal fatigue and their blades will fly off and impale whatever cow or coyote or farmer happens to be passing by. But you can buy Chinese bolts and you can't buy American bolts any more.

Literally thousands of small forges and foundries have shut down in the last 20-30 years. Zinc and chromium plating shops have been particularly hard hit because of the environmental costs of disposing of the chemical plating baths. All of those steel wind turbine towers will need to be coated or plated; otherwise the towers will buckle in 10 or 12 years due to corrosion damage. Where would we do that here in the US? The Chinese don't do a good job of zinc plating but they do it, and nobody cares much what gets dumped in the rivers.

Finally you will need three very long very stiff fiberglass blades for each turbine. (Dow Corning was a pioneer in glass fiber manufacture, but they were driven into bankruptcy here in the US, over the bogus silicone breast implant lawsuits.)

You need epoxy or polyamide resin to soak the glass fibers in to make fiberglass. The resins are petrochemicals. There has not been a new oil refinery built in this country since 1976, and only one new chemical plant in the same time. Oil and chemicals are bad, right? Lots of lawsuits, no building permits."

Dale R McIntyre, PhD

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Perils of modelling: initial assumptions 1

I just thought I'd nick this quote from solar scientist Douglas Hoyt on another blog as it is a succinct summary of what can go wrong with models that have too many adjustable and vague parameters and relying on hindcasts as validations - which I touched on before with respect to fatigue calculations.

"The climate modelers introduced a large upward trend in global aerosols because, without them, their models ran too hot, predicting a global warming of circa 2C in the 20th century, as opposed to the observed 0.6C warming.

As I have pointed out, there is no evidence that the claimed global trend in aerosols existed. At best there were a few regional aerosol clouds covering less than 1% of the globe.

The proper solution to their problem would have been to lower the climate sensitivity to 1C or less. In fact. Lindzen has a convincing paper out recently showing the climate sensitivity is about 0.6C for a CO2 doubling.

The scientific solution to the problem: No large global trend trend in aerosols and low climate sensitivity.

The political “solution” is: Unsupported claims of large aerosol increases which allows the fiction of a high climate sensitivity to be maintained, leading to alarming and false predictions of catastrophic future warming."

Douglas Hoyt

I added. "I wonder if a 3rd party review might have fixed it. There are times when you get a weird modeling result and you can't find the problem so you rationalize it or add a fiddle factor. Only later do you see where the mistake was. Also sometimes throwing money at a group to investigate a problem can fail due to an over-riding need to justify the money and claim more of it."

There's no conspiracy here - just hubris, group-think and self-preservation. Normal science in fact. Just to be fair I'll pick on a few other fields later.

Update: Here is a quote from Lindzen on modelling where he describes the 0.5 feedback:

////////beginning of extract

"IPCC ‘Consensus.’

It is likely that most of the warming over the past 50 years is due to man’s emissions.

How was this arrived at?

What was done, was to take a large number of models that could not reasonably simulate known patterns of natural behavior (such as ENSO, the Pacific Decadal Oscillation, the Atlantic Multidecadal Oscillation), claim that such models nonetheless accurately depicted natural internal climate variability, and use the fact that these models could not replicate the warming episode from the mid seventies through the mid nineties, to argue that forcing was necessary and that the forcing must have been due to man.

The argument makes arguments in support of intelligent design sound rigorous by comparison. It constitutes a rejection of scientific logic, while widely put forward as being ‘demanded’ by science. Equally ironic, the fact that the global mean temperature anomaly ceased increasing by the mid nineties is acknowledged by modeling groups as contradicting the main underlying assumption of the so-called attribution argument (Smith et al, 2007, Keenlyside et al, 2008, Lateef, 2009). Yet the iconic statement continues to be repeated as authoritative gospel, and as implying catastrophe.

Now, all projections of dangerous impacts hinge on climate sensitivity. (To be sure, the projections of catastrophe also depend on many factors besides warming itself.) Embarrassingly, the estimates of the equilibrium response to a doubling of CO2 have basically remained unchanged since 1979.

They are that models project a sensitivity of from 1.5-5C. Is simply running models the way to determine this? Why hasn’t the uncertainly diminished?

There follows a much more rigorous determination using physics and satellite data.

We have a 16-year (1985–1999) record of the earth radiation budget from the Earth Radiation Budget Experiment (ERBE; Barkstrom 1984) nonscanner edition 3 dataset. This is the only stable long-term climate dataset based on broadband flux measurements and was recently altitude-corrected (Wong et al. 2006). Since 1999, the ERBE instrument has been replaced by the better CERES instrument. From the ERBE/CERES monthly data, we calculated anomalies of LW-emitted, SW-reflected, and the total outgoing fluxes.

We also have a record of sea surface temperature for the same period from the National Center for Environmental Prediction.

Finally, we have the IPCC model calculated radiation budget for models forced by observed sea surface temperature from the Atmospheric Model Intercomparison Program at the Lawrence Livermore Laboratory of the DOE.

The idea now is to take fluxes observed by satellite and produced by models forced by observed sea surface temperatures, and see how these fluxes change with fluctuations in sea surface temperature. This allows us to evaluate the feedback factor.

Remember, we are ultimately talking about the greenhouse effect. It is generally agreed that doubling CO2 alone will cause about 1C warming due to the fact that it acts as a ‘blanket.’ Model projections of greater warming absolutely depend on positive feedbacks from water vapor and clouds that will add to the ‘blanket’ – reducing the net cooling of the climate system.

We see that for models, the uncertainty in radiative fluxes makes it impossible to pin down the precise sensitivity because they are so close to unstable ‘regeneration.’ This, however, is not the case for the actual climate system where the sensitivity is about 0.5C for a doubling of CO2 . From the brief SST record, we see that fluctuations of that magnitude occur all the time."

Richard Lindzen

Professor of Atmospheric Sciences, MIT

/////////////////////end of extract

Now just to summarise:

1) It is universally agreed that basic warming from a doubling of CO2 should theoretically be 1 degree C.

2) Model runs say it could be between 1 and 6 degrees C. The extra above the 1 degree number is from a supposed positive feedback where evaporated water vapour from the sea adds to the CO2.

3) This extra warming was needed to match up the recent warming in the Hadley temperature graph with Hadley model output.

4) For this match-up, Hadley modellers had assumed that natural variability had minimal warming effect over the period of study, hence any remaining anomaly must be manmade warming. However they couldn't actually model natural variability - they just pretended that they could.

5) Subsequent non-warming has been blamed on natural variability by those same Hadley scientists which is an admission that the previous assumption has zero foundation.

6) So Lindzen finds out if this supposed positive feedback from water vapour is present in the real, measured satellite data. He finds a sensitivity of 0.5 C from real data, indicating that there must be a negative feedback, not a positive one. One might postulate that this is due to formation of clouds (as Lindzen suggested and as Dr Roy Spencer has obs and published papers to back up).

That's what the real science tells us, ie comparison of the theory with observations - remember that? It's how science used to work. It's not true to say that the models couldn't achieve the same result. In fact they could - all they need to do is adjust the natural variation to reflect real world observations.

However, the latter number implicitly assumes that extra warming is from the CO2 and it is not actually another long-term natural trend. This is fair but not necessarily so because there is a well known descent into a "little ice age" at least in Northern Europe which has not been adequately explained. If that cooling was natural and we started from that natural low point then the heating can be natural too. That said, Northern europe is quite tiny so it's politically correct and probably sensible to assume that man is warming the planet by a small amount. In any event the planet has warmed by mostly natural 0.4 degrees since 1950, the IPCC cutoff date. So what are the implications? For a future post.

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Where do we go from here?

Let's not get melancholy about what should have been done or about the grave injustices of the system. The revolution isn't coming to replace the stupid with the wise so we need to learn to adapt to continued stupidity. In times like this we really need to know where things are going so we can plan ahead. My only qualifications for this are that I managed to predict the crash was coming (and warned everyone I possibly could, some of whom are even grateful) which puts me well ahead of the worlds PhD economists who praise the god of the invisible hand and also seriously well ahead of Alan Greenspan, that latter-day Oracle of Delphi whose inscrutable pronouncements were enough to move entire markets. Mind you, I didn't manage to see then how exactly to prepare for it, apart from moving to a country that didn't see the boom in the first place. The plan was to hold up in this safe haven until other real estate markets corrected to a sensible level and then pick up a bargain. I really didn't expect France to nosedive as well because they had laws to prevent bank speculations. Those sneaky bankers got around the laws that were meant to protect them. Never underestimate the stupidity of the greedy! Happily it was only the big few. Unhappily they still don't quite realize the first role of a bank is to lend money to small businesses, not to gamble with their savers money. Sarko needs to step in here. From the rather pathetic selection of world leaders, he's likely the best man for the job.

Unlike our inglorious leaders I don't expect the dumb suckers who got us into this mess will be to be able to get us out of it so I need to look for guidelines elsewhere. A simple barometer to economic health is to look around and see who still has healthy manufacturing sectors or a lot of natural resources but without too many mouths to feed. We come up with Japan, Germany, France for the first part, Australia, Canada, Brazil, Russia for the second. China and India will be catching up with the rest of the world for a while and then they'll have to deal with a population who'll want unions, social security, pensions etc. The USA is a tricky beast to judge because with that enormous level of debt they really should have tanked by now just like Argentina did. That they haven't is entirely due to the worlds central bankers continuing to buy up US debt and continuing to use dollars as a reserve currency. This doesn't really make any sense but then central bankers never did. Clearly the rest of the world still looks to the USA to bring us out of the depression.

Yet the USA does have a lot of natural resources, and it does have the most encouraging entrepreneurial spirit backed by the best venture capitalist culture by far. They don't mind losing money on most things as long as they gain enough money from the few things that do work. So maybe they can do it after all. France doesn't work that way more's the pity. It's odd but there could be jobs for everyone here - the place is crying out for tradesmen of all sorts. We just can't get them. Every school-leaver wants to be a bureaucrat it seems. Yet entrepreneurs will need to lead the recovery. That there aren't enough small businessmen is due to a double whammy: too much unnecessary burdens placed on them by the state and too many of those bloody bureaucrats. Better said, too much government. It is true that the best thing a government can do for a business is to get the hell out of the way. I'd dearly like to know how to get my hands on this zero rate of interest that the European banks think will crank up the economy. Instead it's being used by big banks to participate in yet more dumb speculation. It just doesn't get to the entrepreneurs. I'm not that much in favour of nationalised banks but if that's the only way for us entrepreneurs to get the stimulus then let's do it.

Anyway here's the plan. Whatever you are selling, make it cheaper. People just don't have the cash just now. Downsize your expenses, so get a smaller house and factory. Take advantage of any zero percent interest schemes you can eg by swapping your credit card and getting eco-loans for insulation, geothermal heating etc. While it's not smart getting in debt it's necessary to smooth things over. Find out what buzzwords are likely to unlock the purses of these government grant agencies and redirect your business plan that way; it doesn't matter if the whole idea is dumb - most business plans stink anyway - just get the money and adapt the idea to something that people will want or need. Do not invest in dollar holdings; instead hold still for now and buy land in about a year. I already see some very tempting real estate that is an absolute steal. There are certain places in the world that will recover. eg Think Florida, not New Mexico.

Technology is our saviour. Anything that gets us to do the job quicker or otherwise saves us money. So any services run through the internet are good. If you can invent something to get rid of spam or protect against internet fraudsters then you've got it made. Robotics will be big and so will long-life batteries to run them. Look for the software that really costs too much and undercut the bastards. They deserve it. Don't worry about losing a customer who says he pays more for whatever reason; if your quality is good then you don't need him. Find someone smarter instead. Entire sectors of expensive software will soon be ditched by government departments in order to save money. That means more Openoffice and less Microsoft Office, more Alibre, less Inventor (I hope anyway). More Linux, less Windows. Games are still to the fore and they'll become more immersive and real, so look for things that'll cater for that: Virtual objects will need to break more realistically than before for example. Virtual offices will proliferate with net-meetings being the norm rather than the exception. Our cars will get lighter so carbon fibre will be popular and cheaper.

Don't listen to the born-again eco-freaks that say the warming planet will cause this or that because a) they are mostly abject hypocrites, b) they are guessing on the pessimistic side, c) we've seen this catastrophism before many times and it always smells the same way, d) the politicians are only paying lip-service to them now, e) the science behind it is pathetically poor f) the real-world observations say the hypothesis is far too simplistic and too dismissive of natural changes, g) models without validation are useless - if you need an example then look at the financial models that predicted unlimited growth; these were actually much better models and were created by far smarter people than climate scientists (similar hubris though). Hence business-wise don't trust any green-tech unless it is actually a good idea and can make a profit without subsidy. Do not buy carbon credits - they are run by conmen. Solar panels will be good if you are in a hot place. Geothermal heating will rocket in popularity. Smart-looking electric cars will be popular whereas the ugly ones just won't - look at Renaults new electric cars, heck I really want one of them and I don't care about the 100 mile range because I just never go that far. What I really want too though is an electric driver so I can relax in the back. I wouldn't plan on nuclear power coming out of the cold - despite all the current green-washing the real problem with it always was it's huge costs. Governments don't have the money. Coal to gas technology will however be popular - natural gas power is far more efficient than coal and needs far fewer moving parts. Crucially though, it can be privately funded and the buildtime is quick.

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