A while back, Thomas L. Friedman was on the Daily Show to advertise his new book Hot Flat, and Crowded. It may be that he oversimplified his explanation for the show, but I am terribly unimpressed. He said we should overinvest in green technologies, cause a bubble, and reap the benefits.
He said that the dot-com bubble left us internet infrastructure and the financial crisis left us with overpriced condos, and now we need a green bubble to get us out of the financial crisis.
The definition of a bubble is putting in more money than it’s worth. Period. If it is going to pay off in the future, that would be called an investment. So this guy wants us to throw more money into an industry’s R&D than it’s worth, he wants us to lure people into investing in the training, experience, and time that is going to dump their job when the bubble comes due. Ask those bankers and financial analysts if there’s too many to go around. He wants us to do it right now so that we can solve or past excesses, not by learning from our mistakes but by repeating them.
The money that Friedman advocates wasting could be better used in making bigger differences on other problems. Those people who are now considering their careers possibly for the rest of their lives may have been more valuable to society learning and performing in other industries. Our current opportunities as they are, to make investments, could be better spent on less ridiculous schemes.
We did not have to overindulge in internet startups to benefit from investing in IT infrastructure. We didn’t have to make ludicrous choices about home ownership in order to gain what dubious benefits we will get out of this mess. And we certainly don’t have to do it again.
To recognize underinvestment is one thing. To deliberately waste money when there are better uses is absurd.
I’d first like to say that this author is amazing. In the first few pages, I was struck by how he could present these real figures with the familiarity one would expect of a fiction writer the characters they designed. This is my first McPhee book and it probably won’t be my last. If you’re at all interested in a good story and a glimpse at the environmental scene in the past, stop reading right now and go get that book. If you’re not likely to read this book, read on.
As many of you know, David Brower is a prominent environmentalist best known for his campaign to prevent a dam that would flood parts of the Grand Canyon. McPhee has arranged an elegant setup. He takes Brower out into the field with three of his adversaries. He uses these encounters to portray the nuances of the issues and beautifully illustrates the depth of these four people with background information along the way.
Round 1: Charles Park; geologist, professor, conservationist
Round 2: Charles Fraser; sustainable developer
Round 3: Floyd Dominy; farmer, dam builder, improver of farmland
There are some very remarkable things about these matches that really give the story a lot of depth and much to consider. One is that they all believed that they were doing good. Park thought that mined resources will benefit humanity and not using those resources would result in suffering. Fraser wanted to make nature available to a large number of people and to create something beautiful. Dominy saw the suffering of those hard working people who’d moved out west and could not make a living on their homestead and so from an early age, he built dams so that pioneers could survive. Brower himself wanted to preserve the land for its own sake and saw his cause as a war of attrition.
What was also intriguing was the amount of knowledge the opponents had. Park spent large portions of his year prospecting all over the world, and spends more time outdoors than any of them. Fraser, while not an outdoorsman, has already built a successful development with many environmentally friendly features way ahead of its time, and he has done his background research with an interest in history, recognizing the long record of human use in the area in question. Dominy is a native of the drought-prone areas and knows the needs and desires of the people.
The other thing that was so striking in these comparisons was how they all appreciated nature. No matter how vehemently they may be arguing, no matter how much they may irreconcilably disagree, when faced with the beauty of their surroundings, they would all pause, and enjoy the sight together. They all appreciated and admired the same thing. There is no ruthless destruction. There is no raping of the earth as it were. There were just different priorities.
It was very touching to have this vision of the environmental discussion of the past, and to be able to see the changes and similarities with the discourse of the present day. This portrayal brought respect and humanity to both sides that often gets washed out in the us-vs.-them mentality that often arises. And aside from being useful, it was beautifully written.
Killing critters vs culling herbivores
Researchers looked back upon a controversial hedgehog culling
and used “content analysis”, a framework used by social scientists that basically looks at diction (vocabulary, wording). They found that different stakeholders discussed the same situation with completely different language.
“The pro-hedgehog lobby wrote about killing and animal welfare issues and used emotive or informal vocabulary, whereas the pro-bird lobby used more scientific language and vocabulary concerning wildlife and the Hebrides. Interestingly, media coverage of this controversy tended to use language similar to that of the pro-hedgehog groups. Our results show how content analysis allows differences in focus between stakeholder groups to be highlighted in a quantitatively rigorous way, and that this can encourage a dialogue to develop in which all stakeholders are at least addressing the same issues.”
…quantitatively rigorous? Yeah well, I don’t think you have to run statistical tests on word counts to know they’re approaching the situation differently and using their written skills to best frame their position. it does however make it easier to identify and address differences.
Miles Per Word
Changing how fuel efficiency is described can make a difference in what cars people buy. Rather than describing efficiency in miles traveled per gallon, if one were to describe it in gallons per 100 miles traveled, it would be easier to see how much of a difference it would make to take a very low efficiency car and improve it.
At 10 mpg, it takes 10 gallons to travel 100 miles. If that were doubled to 20 mpg, it would take 5 gallons. You save 5 gallons.
A car with 25 mpg takes 4 gallons to travel the same distance. Double that to 50 mpg would take 2. You save only 2 gallons.
We’re better off by having people ditch SUV’s for average cars than replacing average cars with better ones. This may seem pretty obvious for after all the SUV is the symbol of everything anti-environmental, but perhaps moreso when presented slightly differently.
“You’re an economist. What about the gas price?”
There’s two reasons I don’t talk much about the gas prices. One, every economist out there is talking about it, and some like env-econ do a fine job of covering every ounce of it. The other reason is that I don’t think just making it cheaper is the answer, which is something many people don’t want to hear. This does not mean I don’t sympathize with people who are adversely impacted recently, but that I think we made less-than-optimal decisions and now we’re paying for it.
Inspired by a conversation last week, here’s my bit on gas prices:
Me: Even now, our gas prices are so darn cheap relatively speaking.
Cohort 1: Cheap? Compared to what?
Me: Compared to Europe, for a start.
Cohort 2: Actually, I just saw a report recently about how we’re 100+ expensive…
Don’t believe us? here are the numbers in question. We’re around 108. European countries have high prices because of high taxes that are used to develop other transportation infrastructure, like mass transit. 18 cents doesn’t compare to a couple bucks. If the price goes up by a dollar here, that’s a significant increase while in Europe, it’s a smaller percentage. Price shocks are bad. It is harder to adjust to a sudden and possibly temporary price change than to shift production and consumption to a predictable future. If you’d known in advance that prices would suddenly go up, you would have planned for it. If you’d known all your life that gas is expensive, you would have made life choices accordingly. Your city might not look the same.
I know that there are people who don’t want anything to do with those ‘socialist’ European countries, but one might consider that our price is much closer to Russia’s.
When I was twelve, I laid out the itinerary for the family vacation. I took out some maps. I hit as many national parks as I could within our two week time frame. I was very proud of myself. I find the summer vacation as important as anyone. But I don’t think the American way of life requires that we remain vulnerable to the whims of a volatile, cartel-operated market. That just doesn’t seem American to me.
I had a revelation today. Perhaps I am slow; behind the times…
As an environmental economist, I at least, believe that environmentalism is for everyone. If you were to truly account for all the externalities, it would be clear to everyone that we are not allocating our resources properly and the environment should be considered accordingly.
And yet, we are not particularly good at selling environmental considerations to individuals. If the truth is truly compelling, honestly logical, and the right thing to do, then anyone should be convinced. Each individual, no matter where they live, how they live, or what they believe in, should have the potential to see this reasoning. But when there is a focus on ethics, morals, and culture–things that are not universal–you miss out on what should be the compelling arguments. It is not the environmental culture that I buy into.
Now, I agree that there is due applause for the environmental movement embracing economic concepts. But these are merely tools used in the name of an older, unchanged philosophy, disjointed piece rather than insights to a larger whole. The market is far more complex than a credit trading house and a price signal. Markets and economics have so much more to offer. It is far more sensible to appeal to self-interest than to expect others’ utilities to bend to one’s will.
Environmentalists should know, more than anyone else, that one size does not fit all.
Someone is compiling a list of video games with environmental themes. I forgive them for not putting in ChronoTrigger yet.
…he handed out too many lumps of coal.
The Arctic is plagued with a variety of woes. Not only is it melting faster than anticipated, it just might be ice-free this summer. It shrank back drastically last year, and while there has been a promising growth in ice over the winter, it is ‘new’ ice that is less resistant to melting. Picture a thin film of ice over your drink vs. a cube in it.
It is also “wetter” than previously, with more rain and more snow. When a thick frost forms on top of the snow, reindeer and other animals accustomed to digging down are unable to break the surface.
When the ice melted back last year, it exposed the fabled North-West Passage that connected the Atlantic to the Pacific. Among other things, one of the concerns brought up by the opening of the Arctic are fisheries. As ocean temperatures rise, fish species are appearing in new places, typically moving northward. In an attempt to forestall future crashes in fish stocks, there is an attempt to establish a marine sanctuary within the exclusive economic zone around Alaska. There’s no teeth in it yet.
o/~Just one time I would take the northwest passage… o/~
Ars Technica posted a nice description of the governors’ conference on climate change from last week. It is widely known that California has attempted to set its own emissions standards and has been blocked federally.
Perhaps in anticipation of the promises of all three presidential candidates, there is a new venture to bring Norwegian electric cars to California.
The joint venture’s first product will be Think City, an emission-free, 95 percent recyclable car with a maximum speed of 65 miles an hour. Plans call for a U.S. launch next year.
Lane said he expects the Think City, which will be priced under $25,000, to compete with Toyota Motor Corp’s popular Prius hybrid.
Their plan include charging stations to support the 50,000 cars they hope to be making annually.
If the US government won’t take the lead in promoting a market for cleaner cars, who will? …China?
The question of hybrids and other fuel efficient vehicles arises because the world’s automakers are gathering this week for the Beijing Auto Show, an event that is growing in clout as the world’s second largest auto market is set to be No. 1 soon.
But executives are waiting for Chinese officials to lay out a set of incentives that could jump start a product line…
Given how much we’ve used China as an excuse not to sign onto Kyoto etc, it would be terribly embarrassing if the world had to turn to China to take the lead. On the other hand, a switch to a purely electric car might not be so great an idea, for China.
Nissan Motor Co Chief Executive Carlos Ghosn told reporters the Japanese automaker is approaching the Chinese government, among the many it is in talks with, to push for a pure electric vehicle solution to battle pollution.
China depends heavily on coal to produce electricity. Emissions offset from the tailpipe will just appear elsewhere.
Hey, if the federal government doesn’t want California to dictate standards for the entire country, there might be appeal to dictating standards abroad.
Whatever it is that the government does, sensible Americans would prefer that the government do it to somebody else. This is the idea behind foreign policy.
1. Emissions by country
2. Chinese energy consumption
3. US energy
But there are certainly other unlimited sources of items that can be refined, and Eve players will surely find the next best deal. They probably have already.
There is. 😛 3.66 isk/unit for civilian afterburners
I take part in a little company on Eve Online that makes really big ships. We buy lots of materials off the market, like tritanium. Please note that I am a very casual player of Eve.
So the SO comes by.
“Oh did I tell you trit prices went up?”
“They took out a loophole where you could refine shuttles for trit.”
“Yeah. The going rate was 3.2/unit, shuttle price was 3.6, and now it’s 4.6 or so.”
“Ew. Now what?”
“The price will come down some and we have reserves to ride it out. We’ll wait a bit for the price to come down before purchasing more.”
At first it appears straightforward:
You can either mine trit, or you can buy and refine an unlimited supply of shuttles to produce trit. You remove the trick, and people will have to rely on mining. There is a temporary spike because people have to shift over to mining, and a permanent rise in prices.
But wait! The price of trit was below the price ceiling. Normally, that would mean that the price ceiling was ineffective and irrelevant, but that is not the case here.
People who buy shuttles and refine them for trit do not interact with the market. The demand observed in the market does not include the total consumption of trit, only what is mined. Buyers who don’t refine, and sellers who mine, trade at 3.2/unit. Everyone else pays 3.6/unit for convenience or whatever. When the 3.6/unit source of trit was removed, the true demand suddenly became visible, while it will take supply time to respond. Prices spiked to ~4.6, and they will eventually go down.
However, we don’t know how far down it will go. Eve’s economist did indeed note the correlation between shuttle prices and trit prices, which is probably what led them to remove the loophole, so that gives us an idea of what the actual demand is. But there are certainly other unlimited sources of items that can be refined, and Eve players will surely find the next best deal. They probably have already.
I hope this illustrates that while economics, the study of resource allocation, can be applied to games, it can be in pretty silly ways. It also shows that people understand these things intuitively. Everyone knows that if a known and exploited loophole is removed, the price will go up, until new solutions are employed, whether it is as intended, or more likely, another smart loophole. Moreover, there are probably a thousand other details peculiar to this market that I am completely ignorant of since I am not an avid player.
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