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Carbe Diem November 18, 2010

Posted by Amir Roth in climate, economy, football, taxes.
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Shortly after the midterm election, a chastened POTUS Lightning said that he was looking forward to working with Republicans on moving the economy and the country forward. He didn’t mention the Bush tax cuts. He didn’t mention healthcare. Or immigration. Or the deficit. He mentioned education. And he mentioned energy. Is Obama planning something major? I hope so, but probably not given that he’s an actual practicing politician and not “just a blogger.” Will Republicans go for whatever it he has in mind? Stranger things have happened. Okay, they haven’t. But here’s an idea—start phasing in a carbon tax. The time is ripe. Let me explain.

Ichi: A carbon tax will create jobs. Opponents of energy taxes claim they kill jobs. This is true for any tax! Taxes on consumers reduce disposable income and demand for goods and services. Taxes on businesses reduce the amount of money available for employee salary and benefits. Income taxes kill jobs! Sales taxes kill jobs! All taxes kill jobs! But some taxes can create jobs too. How? By fixing a price signal to a commodity or activity that creates a market for substitutes for that commodity or activity. A carbon tax will create a market for alternatives to and more efficient use of carbon-based energy. What do sales taxes create a market for? Alternatives to sales? What does income tax create a market for? Alternatives to income? Actually, sort of. It creates a market for ways to hide income. The US government doesn’t need to inject billions of taxpayer dollars into energy efficiency and clean energy research, a carbon tax will draw that money from the private sector much more efficiently. Taxes are necessary. With no taxes, there is no government and no social services—actually, there can be government without taxes but this requires massive amounts of oil and Sharia law. If we have to fund our government through taxes, shouldn’t we use taxes that create jobs in addition to killing them as opposed to taxes that only kill jobs?

Ni: A phased-in carbon tax will not kill any jobs, at least not immediately? A carbon tax will kill some jobs immediately, or—assuming that most precarious jobs are already gone and that most remaining jobs are robust—will restrict the creation of new jobs. But a phased-in carbon tax will not. An effective carbon tax needs to be something on the order of $200 per metric ton of CO2. That works out to about $1.83 a gallon. Yes, if a $1.83 per gallon gas tax goes into effect January 1, the economy will wretch. But if a $1.83 per gallon gas tax gets phased in over the next five years at six month increments, then on January 1, the tax would only be $0.18. It would go to $0.36 on June 1. And so on. The economy will adjust to a slow climb like that—in a way that a frog adjusts when you boil the pot of water it is swimming in—especially if it’s predictable. So if the carbon tax is initially too low to kill any jobs, how can it create jobs? Aha! The investment, and jobs, will be drawn to the certainty of the future tax not to the present tax!

San: There is a window of opportunity to restructure the tax code. With the Bush tax cuts—here is a piece by the Brookings Institution that summarizes the Bush tax cuts and their effects—set to expire when the apple drops on 2011, Republicans and Democrats are angling and wrangling over whether to let them expire, extend them, or create a hybrid solution split at an “upper-middle-class” earning level like $250,000 a year. It looks like Republicans are going to insist that upper class tax cuts are part of any deal—attention, middle class! the Republican party is holding your tax cut hostage just so that the 2% of American families making more than $250,000 a year can have a tax cut too! Remember this in November 2012—but they seem willing to put other parts of the tax code like deductions and exemptions on the table. Perfect. And perfect. Perfect I. Democrats can use a phased-in carbon tax in a tax hostage exchange! Republicans, you want the upper-class tax cuts? Accept a phased-in carbon tax! Perfect II. A carbon tax is regressive in the sense that it taxes consumption and lower-class households consume a larger fraction of their income than upper-class ones. However, Democrats can protect lower class households using exemptions and deductions—the parts of the tax code Republicans put back in play! How about an automatic $1,000 carbon deduction? Or an automatic $1,000 carbon refund?

Chi: Philly Bluejay will start incorporating bold run-in headers. Following the lead of proto-Bluejay TMQ and the 15 rules of good blogging, Philly Bluejay will begin introducing bold run-in headers to make posts more “skimmable” and to allow casual readers to absorb the major points without tiring their batting eyes by forcing them to digest a thousand plus words. Coming in 2012, a photo! Maybe.

Go: We will not make any dent in climate change without it. No amount of good will towards polar bears and residents of lowland regions in developing countries and Florida will get us off of carbon. When push comes to drive, people just don’t care about polar bears that much. Not to mention developing countries. You want people to get off of something? Tax it! Note, this applies only to things people are already doing. I’m not talking about California Prop 19, although I personally would have voted for it. By the way, if you still don’t believe that climate change is going to be off the chain, read ClimateProgress sometimes. And if you still don’t believe that climate change is real, why are you reading my blog?

Roku: We will not make a dent in the debt without it. In order to reduce the federal debt, the US government has to start running at a surplus rather than a deficit. The US government is currently running at a deficit of about $1.5 trillion. $1,500,000,000,000. Can you find $1,500,000,000,000 to cut here? It’s not easy unless you significantly cut both defense and social security. And don’t go after other discretionary spending. For one thing, it’s only about a third of the deficit. For another, it includes “discretionary” outlays like education and roads. Basically, there is no way to do it without raising taxes.

Shichi: goto ichi.

P.S. Want to know what voters really care about? Ask two weeks after an election! On November 2, Democrats lost 60 House seats, 6 Senate seats, and 10 state houses because voters were upset that government spending was exploding the deficit. Voters replaced many of these Democrats with Republicans who propose to grow the deficit further—but that’s a small detail. Less than two weeks later and with the mid-term behind them, only 4% of the same voters care about the deficit suggesting of course that they never did, that deficit hawking was convenient Republican misdirection. In a previous post, I asked whether any Republican candidate knew why a deficit was bad, and not just that it was bad. Predictably, the answer is a resounding ‘who cares?’ Hey Wisconsin/Pennsylvania/Indiana/Illinois/Arkansas/South Manitoba, can we have those seats back now?

P.P.S. How much is the decline in fertility rates in industrialized countries due to increased working opportunities for women and how much is due to increased laptop use by men?

P.P.P.S. Philly Bluejay gets about 20-30 hits a day. Some of these are from subscribed readers. Some are from aggregators that pick up on tags. But more than half are from searches. Specifically, from five particular searches. Evidently, Philly Bluejay is now an authority on the following topics, in frequency order: 1) Aron Ralston, 2) “the birthday problem,” 3) volcano lightning, 4) Salvador Dali butterfly pictures, and 5) Amir Roth.

P.P.P.P.S. The Mrs. and I were at FedEx field Monday night as the visiting Philadelphia Eagles administered a beat down for the ages to the Washington Redskins. The ink was not yet dry on Donovan McNabb’s head-scratching $78,000,000 contract—somewhat less head-scratching now that full details of the deal have come out—and Billy Ray Cyrus was not done singing the anthem before Michael Vick connected with DeSean Jackson on an 88 yard touchdown! And the route was on. By the middle of the second quarter, with the Eagles leading 42-14 and steady rain coming down, most of the Redskins “faithful”—including the douchebag who flipped Mrs. Bluejay off—had departed, leaving a scattered sea of green to watch the rest of the game in drenched peace. Must-see-TV Michael Vick—the NFL’s top rated passer and maybe its top runner too—blew through Washington’s “wet paper bag” defense to the tune of 413 total yards and six touchdowns. Was it only four weeks ago that I said that Kevin Kolb should stay the starter for the rest of the season? How “must see” is Vick? NBC has already flexed next weekend’s Eagles-Giants game to Sunday night—Vegas has Eagles -4. Really? Is that all? How did Eagles -3 work out for you boys this past Monday night?—and Fox has already moved the following week’s Eagles-Bears game to the 4pm “national game” slot. Next up—the NFL will launch a Michael-Vick only network.

Hot, Flat, Crowded, and Taxed October 12, 2010

Posted by Amir Roth in books, clean energy, climate, energy efficiency, sustainability, taxes, weird.
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One of my favorite parts of my temporary new job is the commute. It’s between 30 and 40 minutes each way, but all on public transportation. This not only gives me the moral authority to browbeat people about their energy consumption—I’m not part of the problem! I use public transportation! My carbon footprint is only 12 times that of an average Indian, not 14 times!—it also gives me time to read in relative peace and while I am more or less awake. In fact, I am somewhat surprised by the relatively small number of people that read on the Metro. On any given day, I would say that fewer than 20% of the people on the Metro are reading, and most of those are reading that free magazine you can get as you come into the station. What are the other 80% doing? 20% are texting. 20% are listening to iPods. 20% are staring blankly into space. 19% staring blankly into space, listening to their iPods, texting in one hand, and holding the Metro newspaper in the other. 1% are trying to extricate themselves from the Metro doors.

The first book I read entirely on the Metro was Tom Friedman’s “Hot, Flat, and Crowded.” I won’t rehash Friedman’s thesis—the best thing America can do for itself and the world is to go seriously Green—Friedman does that just fine. I did want to say three things about the book though. First, I love that the cover is sampled from “Garden of Earthly Delights” by Hieronymous Bosch. Look no further than GoED for proof that they had very good psychotropes even in the 15th century! With publishing margins as slim as they are these days—although perhaps not for bankable stars like Friedman—why pay for cover art? Sample a renaissance painting for free!

Second, one of the things that struck me about “World Is Flat”—HF&C’s predecessor—was Friedman’s own itinerary. Bangalore. Shanghai. Doha. Copenhagen. Sao Paolo. Back to Bangalore. The most frequent refrain in WiF is “I just kept on moving.” Readers of Philly Bluejay know how I feel about business air travel. Friedman may fly more than any person on the planet! This was bad in an absolute sense but not hypocritical in the context of the book—WiF is about globalization. But HF&C is about climate and the Energy Era and yet the itinerary is similar. London. Mumbai. Dalian. Multiple visits to every continent except for Antarctica. I hope Mr. Friedman purchased carbon offsets for all of those air miles! Now, if you will excuse me, I have to fly to San Francisco. For business. Tom, I kid because I love. And because I am a hypocrite.

Third and finally, I want to elaborate on Friedman’s point about the necessity of a carbon tax. One of Friedman’s sub-points is that a clean energy revolution will never truly take off without a clear, loud, consistent and projectable price signal on carbon. The market will not move away from carbon—at least not efficiently and at scale—unless they know what staying with carbon will cost and unless that price is sufficiently high. Short of privatizing the atmosphere, the fastest way to create this signal is by government regulation. And here he advocates a carbon tax over cap-and-trade. Friedman views cap-and-trade as a kind of “hidden ball” trick—a way for the government to limit emissions in a way that does not result in direct costs for consumers or a direct trail of money back to itself. In a perfect world, the government hands out emissions credits, electric utilities buy and sell them amongst themselves and customers don’t see increased rates, and when they do, they don’t see that money going to the government. Friedman claims that this kind of shenanigan hides the true urgency of the problem from people—people are not going to change their habits unless they see how their actions translate directly into costs. I agree. Wholeheartedly. But I think that a better and more accurate way to state this problem is that a cap-and-trade system isn’t an effective price signaling mechanism because it doesn’t behave like a traditional price!

A price is a constant. The price of the first unit of is the price of the millionth unit. With a price, cost is always proportional to consumption and you can safely map out the future. Not so with cap-and-trade. With cap-and-trade, the price of a unit purchased under the cap is far less—perhaps infinitely less—than that of a unit purchased over the cap. And whether a unit is over or under depends on overall demand, not on your demand. Which system do you reckon would be more conducive to economic growth? “Neither” is not an option!

Meanwhile, the real commodity here is not electricity—or even coal—it’s CO2. It’s easy enough to create a cap-and-trade system for coal or electricity. A CO2-emissions-from-coal exchange would consist of a relatively small number of individually large participants. A cap-and-trade makes some sense in this case. But oil companies do not operate like utilities and so the CO2-emissions-from-gasoline effectively consists of millions of small participants. Cap-and-trade is logistically much more difficult here! And remember, if cap-and-trade were a true pricing mechanism than it would be possible to trade gasoline emissions for electricity emissions. Anything short of a holistic economy-wide cap-and-trade will effectively create a market distortion, effectively subsidizing uncapped sources of emissions at the expense of capped ones. Market distortion—specifically, implicit subsidies for carbon emissions—is how we got ourselves in this mess to begin with!

Perhaps Tom and I can discuss these points en route to Sacramento. Or maybe at the checkout counter at the Whole Foods on River Road. Tom, Text me!

P.S. The cover art of HF&C contains several images from the Paradise and Earth panels of GoED, but none—as far as I can tell—from the Hell panel. Was this intentional? A better cover would have had a sample from “Paradise” on top and “Hell” on the bottom. No?

P.P.S. Another suitable cover for HF&C—although not renaissance and likely not royalty free either—would have been a pair of paintings by neo-Bosch Salvador Dali. Butterfly windmills on top and that-painting-with-a-giraffe-on-fire-which-I-swear-is-by-Dali-but-I-can’t-find-a-link-for-so-now-I-don’t-know on the bottom.

P.P.P.S. Wonder if the Taliban puts this on their recruiting posters.

P.P.P.P.S. If you drop something on an escalator, never shoot your hand down to try to catch it while it’s falling. I’m just saying.

Hardy Har Har September 28, 2010

Posted by Amir Roth in business, climate, economy, football, politics, society, taxes, transportation, war.
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The GOP is always good for a laugh. Regardless of how it’s pronounced, the party’s House leader spells his name Boehner. They gave us tea-bagging. And Sarah P. And wiccan-cum-Palin Christine O’Donnell. And now, just in time for the midterms, they’ve given us the Pledge To America. Yes America, congressional Republicans have an actual agenda other than filibustering Democratic legislation!

What is this agenda? Why are you asking me? Download and read it yourself! Don’t let the 10 MByte file size or 48 pages put you off. Text doesn’t take up much file space—one or two bytes per character—a 10 MByte document has to contain a large number of pictures. And in fact, PTA has 15 full pages of pictures! Of the Statue of Liberty, the Deepwater Horizon Rig, Mount Rushmore, Montcoal, the White House, Gitmo, the Capitol, K Street, House Minority Leader Boehner, Christine O’Donnell, main street USA, prison USA, a cowboy silhouetted against a sunset, Tony Romo, three old dudes at a supermarket beef counter, a CAFO, soldiers, caskets. Pictures that make you proud sick to be an American! There are also nine pages of content tables and titles like “Checks and Balances” and “Speak Out!” Plus two pages of figures for the sake of figures, including a nice one of Obama-spaghetti-care. That leaves you with only 22 pages of text. Still too much? Not to worry, the text itself is in large font, 1.5 spaced, and has huge margins. I banged it out on my iPhone between Tenleytown and Metro Center. And if this is still too long, there is the handy pocket card. Perfect for parties, or just around the water cooler! Alright, enough boilerplate and lace. Let’s briefly go over the “contents” of this bad boy, shall we?

Theme I: “shrink the government, reduce spending, and cut the Federal debt.” End TARP! Privatize the mortgage industry! Cancel the stimulus bill and reclaim all unspent Recovery Act funds! Return government spending to pre-bailout/pre-stimulus levels! Excuse me, but not even Sergey Brin is this rich! TARP was expensive, yes, but TARP also prevented a complete Wall Street meltdown and saved several US financial giants. The Fannie and Freddie bailouts were also expensive, but they did keep millions of American home “owners” temporarily afloat and the housing market from spiraling even more than it did. And yes, the unemployment was 7.7 before ARRA and 9.5 now, but what would it be now without the recovery act? And where would Philly Bluejay swim? Philly Bluejay currently swims at the sparkling Wilson Aquatic Center, proudly built using ARRA funds! But back to my point. All of these programs were and are expensive. And government spending was lower before they were enacted. But all of these programs were necessitated by Republican-led de-regulation of the financial and mortgage industries! And do you know which government programs were and are even more expensive? That’s right, the wars in Afghanistan and Iraq. Strangely, no mention of canceling those in PTA. In fact, the only mention of Iraq and Afghanistan in PTA is in an item related to Iran. Which brings us to …

Theme II: “make America secure at home and abroad.” Protect our borders! A stronger visa program! Don’t let anyone out of Gitmo! Clean troop funding bills! Tough sanctions against Iran! A fully-funded missile shield! Let’s put the borders/visa/hate-of-Mexico/love-of-waterboarding issue aside for a minute and focus on the last three points. “Clean troop funding bills” essentially means a blank check from Congress to the Pentagon. Yes, that will definitely help to decrease spending! Tough sanctions against Iran because … well … Iran hates us and they will have nuclear capability by 2015. Actually kids, Iran will go nuclear before Passover and “tough sanctions” have as much of a chance of getting Ahmadinejad to back down as a personal plea from Philly Bluejay. Please Mahmoud, please dismantle your nuclear program. I promise not to make fun of your height or use your name and Kim Jong Il’s in the same sentence any more! That work? No? Bummer. And so what will definitely work against mini-me—oops, I did it again—Korean mini-me, and any other vertically-challenged-head-of-nuclear-state-gone-wild is a missile shield! The same missile shield will also stop hijacked planes, bombs in the New York subway system, IEDs, cyberterrorism, and attacks on our energy and water infrastructure. And it won’t blow the budget. Much. And also, to defeat attacks from the sea, the US coast will be patrolled by ill-tempered seabass with frikking lasers! A missile shield? Seriously? Do you know what would be far more effective against Herve Villechaise and Nelson de la Rosa—shame on me, I’ve just made fun of three dead dwarves in the span of 100 words—and far cheaper than a missile shield? About 50 F-16 Falcons and 10 B-2 bombers! A missile shield? A missile shield? Why not just run on “We will build a Death Star?”

Theme III: “no more Federal funding for abortion.” Ah, the abortion card! Apparently, they are saving the stem cell card for later.

Theme IV: “increase access to domestic energy sources.” Does this mean offshore wind farms in the North Atlantic and solar in Arizona or lifting the offshore drilling ban and opening up Alaska? I’m confused. Actually, I’m not. Of all the ludicrous statements in PTA, this might be the worst. I guess the fact that DC was buried under three feet of snow this past winter proves that climate change is a hoax perpetrated by Liberal scientists and that an ice age is coming! Drill baby drill!

Theme V: Two items Philly Bluejay supports: “make the Bush tax cuts permanent … for all Americans” and “oppose any carbon ‘cap-and-trade’ system.” These are solid proposals. Payroll taxes should be reduced. Even tiered income tax systems discourage people from working while doing nothing to curb massive consumption at the top. Meanwhile, cap-and-trade is complicated, provides the government with uncertain income, and doesn’t cover a sufficient number of sectors. The US needs to gradually reduce payroll taxes and combine those with a gradually increasing economy-wide carbon tax—payroll taxes should decrease by 1% per year for the next 10 years and CO2 emissions should be taxed by an additional $10 per ton per year over the same period, maxing out at $100 a ton. Think that’s high? It’s actually pretty pathetic—only about $34 per barrel of oil or $0.80 a gallon. Either way, Philly Bluejay salutes you, GOP! These two planks alone are enough to make Philly Bluejay forget about the rest of your nonsense, move to Delaware, and vote for Christine O’Donnell!

P.S. Philly Bluejay’s temporary new employer, US DOE/EERE—United States Department of Energy/Energy Efficiency and Renewables Division for the TLA/TLA/FLA impaired—has some cool programs like CYES (California Youth Energy Services). Philly Bluejay is not personally involved with these programs. Philly Bluejay is only involved with double-secret (i.e., obscure) programs.

P.P.S. Philly Bluejay’s namesakes—the Philadelphia Phillies—just wrapped up their fourth consecutive division title as for all practical purposes the number one seed in the conference. Good job, men! Red October 2010! Woot!

P.P.P.S. More “baseball news.” A California jury found Andrew Gallo—the drunk driver who last summer killed Angels pitcher Nick Adenhart and two 20-something female friends—guilty of three counts of second-degree murder. Gallo could spend the next 50 years in prison. Gallo is no doubt a LEED Platium moron, but his biggest shortcoming is not being a NFL player! Less than a month before Gallo’s unfortunate accident, then Cleveland Browns wide receiver Donte Stallworth killed pedestrian Mario Reyes in a drunk driving accident in Miami Beach. Stallworth was convicted of second-degree manslaughter, spent 30 days in jail, another two years in house arrest, and came to an “undisclosed” financial settlement with the Reyes family. He was subsequently signed by the Baltimore Ravens! Oh, the hypocrisy! Philly Bluejay wonders what the sentence would have been had Stallworth killed Adenhart.

P.P.P.P.S. In other Philadelphia sporting/avian news—week 2 of the Michael Vick era and the Eagles sit atop the NFC East! This weekend, prodigal son and recent cast-off Donovan McNabb—just “recent cast-off” is not specific enough—returns to Philly. Oh, the drama! Opening line from Vegas? Eagles -7! Whowouldathunkit?

P.P.P.P.P.S. Still more football news. Philly Bluejay major icon and fellow Bethesda resident Gregg Easterbrook had absolutely nothing to say about the Andy Reid/Kevin Kolb/Michael Vick/Donovan McNabb love-hate quadrilateral in this week’s Tuesday Morning Quarterback. Although TMQ did have a funny piece about acronyms disowning their full-word namesakes. Perhaps Philly Bluejay will shoot Easterbrook a text and ask! Perhaps Philly Bluejay will also shoot Easterbrook a text to ask about licensing the name “Tuesday Morning Third-String Emergency Quarterback” or perhaps “Wednesday Afternoon Practice Squad Safety.” Although perhaps TMQ stands for nothing, in which case no text is necessary. Starting this weekend, Philly Bluejay will be known as WAPSS.

Electric Net Neutrality? May 3, 2010

Posted by Amir Roth in clean energy, economy, taxes.
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The recent developments in the net neutrality battle (see Comcast vs. FCC) and my general interest in clean energy and energy efficiency have led the following idea to kick around in my head for the last few months—does it make sense from both physical and end-goal standpoints to try and enforce some analog of net neutrality on the electric grid? Is it feasible to decouple maintenance and governance of the electric grid itself from electricity production at its edges, thereby opening up electricity production to consumer-facing competition? It appears to me that if this were the setup, then such competition—combined with a price on CO2 emissions—would be the most effective driver of a whole-scale move to clean energy production. Wind or solar clean-energy mini-utility startups would spring up by the thousands and coal-fired power-plants—CCS-enhanced or otherwise—would not survive the twenty-teens. Imagine that you were free to buy your electricity from any provider. Would you buy it from a company that had to pass its CO2 emissions costs to you?

Before I go on—and if you are a Bluejay regular, you know I’m going on—is a neutral grid with consumer-facing competition strictly necessary? Wouldn’t a plain carbon tax or a cap-and-trade system move electricity generation towards clean-energy? Not necessarily. A carbon tax without competition will likely not push a shift towards clean generation, or at least not quickly. Without competition—and many markets aren’t competitive—providers will just pass the tax onto consumers. Consumers in turn may choose to consume less electricity—or to purchase solar panels and water heaters—and the provider may generate less electricity produce less CO2 as a result. And this would be good too. But if the provider were guaranteed some level of consumption, there wouldn’t be much impetus for change. In the absence of competition, cap-and-trade may be similarly ineffective because an unchallenged provider would just pass the cost of CO2 allowances to consumers. Cap-and-trade does have the benefit of a CO2 cap, but providers may choose to meet that cap by producing less electricity rather than by producing additional electricity cleanly if the additional electricity could not be sold at a profit. In a competitive market, providers that did not pay a tax or allowance fees would have a cost advantage they could pass onto consumers. Competition is key. How do we make it pervasive?

For the internet, neutrality means that carriers must treat all traffic equally. Where the rubber meets the road—and where Comcast meets the FCC—they must give equal priority and resource to traffic they don’t profit from as they do to traffic they do profit from. This is the condition in which the internet grew and one of the facilitators of the massive innovation by content and application providers. ISPs charge a monthly fee for access. Content providers duke it out for the rest—sales, payed content, ad dollars, whatever. The problem starts when companies go vertical and provide both access and content, like Comcast. More accurately in the case of Comcast, the problem is when an already vertical access/content company gets into the internet business. Surprisingly, the Federal appeals court recently ruled against net neutrality—actually, it ruled against the FCC’s power to enforce net neutrality—but eventually, net neutrality should and will be placed on a legal footing. And Comcast will either toe the line or have its business broken up into Comcast access and Comcast content. In the electricity business, every company is Comcast. There are no separate electricity content and access providers. Providers provide both content (electrons) and access to it (wires). All companies have a vested interest in selling you their own electricity rather than someone else’s. The electric grid is not neutral because it did not grow up that way. But that doesn’t mean it can’t be regulated into neutrality.

To be sure, electricity is not internet data. Internet data is digital, can be transmitted without loss, and along a variety of media—telephone lines, coaxial cable, optical fiber, airwaves—all of which support wavelength division multiplexing. Electricity requires moving electrons along electrical media, which as far as I know does not support WDM and experiences loss over distance. But this doesn’t matter for neutrality. What matters is that, like the internet, electricity providers and their proprietary grids are interconneted and can pass payload to one another. An electricity provider should not be forced to sell you someone else’s electricity—that may be either impossible or inefficient—but they can be forced to sell you their own electricity at someone else’s price!

Here is the proposed setup. The electricity business gets broken into two pieces— a monthly connection or access fee, and content or usage charges. The access fee is collected by the local provider. The usage charge is collected by whichever provider you sign up with, with your local provider possibly tacking on a small “processing” fee, e.g., $0.0025/kWh. The electricity you get is produced by your local provider, but your contract is with the producer of your choice. The producers simply fulfill each other’s orders as necessary in an electric form of Nader-trading. Of course, producers cannot sell more electricity than they can actually produce. And so initially, not everyone would be able to sign up for green CO2 tax/allowance fee-free electrons. But any and all such electricity that comes online anywhere will be bought immediately—much like it currently is in China by state mandate—and there is nothing like perfectly elastic demand to encourage supply.

What say you, people?

P.S. Temperatures last week in Philadelphia: 60, 40, 50, 70, 90. I don’t think we’ve ever wanted to have the heat on and the A/C on in the same week. Climate change? What climate change?

P.P.P.S. For the past few weeks, I have been working on a 5,000 piece jigsaw puzzle of Breugel the Elder’s “Tower of Babel.” I have the sky and ocean part done or about 30% of it. I realized something yesterday that I suppose I should have realized a long time ago—the cuts in jigsaw puzzles are periodic! Entire sections can be exchanged for one another or even checkerboarded. I realized this when I noticed that a 4-piece section of the sky on the right side of the puzzle was slightly off-color relative to its surroundings as was a similarly shaped 4-piece section on the left side. Who knew?

Ecological Intelligence March 31, 2010

Posted by Amir Roth in books, climate, sustainability.
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I just finished Daniel Goleman’s “Ecological Intelligence”. So I thought I would pen (finger) a quick review/affirmation/rebuttal. The basic idea is that we are entering (perhaps) the age of “radical transparency” in the marketplace. An age in which consumers will know about the good and bad impacts of every product they buy–health impacts, environmental impacts, and social impacts. Armed with this ecological intelligence, 10% of consumers will switch to “responsible” brands even if they cost more, while another 75% will switch to “responsible” brands assuming cost neutrality. This will create a virtuous cycle in which companies compete not only on product quality and price but also on environmental and social stewardship. With the market now having stake in environmentalism, utopia will ensue!

Goleman is optimistic, but not quite that naively optimistic. He points out that environmental and social responsibility is already a mission for many companies and that there are fledgling services for providing impacts information on a B2B basis (Earthster) and at point-of-purchase (GoodGuide). But also that there are many challenges to creating such a radically transparent market (the amount of information you need to gather and collate is mind-boggling) and many questions about the scope and scenarios in which such a market would actually “work.” Presumably, there are large numbers of people in the world who are in no position to make purchasing decisions based on anything but cost. And presumably, there will be certain products and services which, by definition, will require disproportional damage to the public commons.

Anyways, I think that a ecologically transparent marketplace will be a good thing and will make the world better. I just don’t know that it’s enough. There are those who say that it is the market that created the climate change, environmental toxicity, and social imbalance and so it is the market that can most effectively fix these problems. But there are also those who say that the market has already proven it cannot deal with “commons” in a non-abusive way and that the most effective way to incorporate a commons into the market is to privatize it. Let us privatize the environment then. On a more serious note, I think that marketplace transparency can be effective in improving corporate social responsibility, and that it can potentially be effective in producing more sustainably derived, healthier to use products. But I think it is quite limited in what it can do to improve global environmental condition, specifically global warming. A transparent marketplace will allow people to choose low-footprint products over high-footprint products, but I doubt it will make them take the best choice–fewer products! That a pair of jeans requires 2100 gallons of freshwater to produce (cotton is very thirsty) is only part of the problem. The bigger part is that many people have ten pairs of jeans when in reality they only need 5. Or 3. That cars average 19.8 mpg and spew 1.2 lbs of CO2 per mile is only part of the problem. The bigger part is that people drive so much. Will GoodGuide help us buy less? Drive less? Live more responsibly? I doubt it. Only a realistic non-subsidized price on goods like water and CO2 will make us do that.

P.S. BO, what is this? If you want to throw Republicans a conciliatory bone, tell them that you will pick up Mike Steele’s tab at Voyeur’s. But lifting the ban on new offshore drilling is not going to accomplish anything positive (except for reduce the price of gas by an average of 2 cents starting in 2026) while perpetrating all sorts of damage to coastal environments and perpetuating habits we need to break! Say it ain’t so, BO!

P.P.S. Goleman also wrote “Emotional Intelligence” and “Social Intelligence”. Given my current emotional and social state, maybe I should put those on my queue as well.

P.P.P.S. In other news, it’s been the wettest March on record. This couldn’t be because there is too much moisture in the air because of excessive oceanic evaporation because it’s too damn hot, could it?

A Good Climate/Energy Bill? March 30, 2010

Posted by Amir Roth in clean energy, climate, energy efficiency, sustainability, Uncategorized.
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If you were to ask the average Joe (e.g., Joe “the plumber”) or Sarah (e.g., SarahP) what the most important issue facing the country today, he or she would say “jobs” (if they didn’t have a job) or “health care” (if they had no health insurance or inadequate health insurance), “immigration” (if they were white and lived in Texas/Arizona/New Mexico/California/Colorado or if they were here illegally), “national security” (if they just saw or read about the Moscow subway bombing), DADT (if they are a hater) or “inability to see Finland from my house” (if they were SarahP).

But the real answer, the right answer, is climate change and/or clean energy interchangeably. Politicians usually deal with short term disasters like (e.g., housing market crashes, failure of “too big to fail” financial institutions) and some medium-term problems (e.g., impending bankruptcy of Medicare/Medicaid/Social Security). They are less apt to tackle long-term problems like climate change, preferring to defer those to future administrations which will be forced to meet them as they reach medium- and short- term status. And this is not just politicians, this is humans. We simply don’t respond to slow incremental change for the worse in the same way that we would respond if that change were abrupt.This is why Dan “Stumbling on Happiness” Gilbert says that climate change is happening too slowly. If it happened faster, we would be more likely to do something about it.

We don’t respond to slow change because evolution hasn’t selected and wired us (or our amygdala) for it. But fortunately, it has given us a frontal cortex which allows us to sit back, analyze, and take rational action. And any rational analysis shows that we can’t really afford to wait to do anything here. Unless we do something relatively drastic in the relatively near future, the effects of climate change will not only make actual living less physically pleasant or tolerable than it is now, it will exacerbate each and every problem we feel acutely today. The economy? Conservative estimates are that nations will have to forfeit 15-20% of their GDP to mitigate direct effects of climate change. Health care? Global warming will push malaria and other currently “tropical” diseases to latitudes and altitudes which are now temperate and free of these diseases. Immigration? Rising sea levels will displace the entire population of Florida, not to mention Bangladesh and about 50% of the population of China. DADT? I guess climate change will not have an impact on that. Although maybe it should. Maybe if climate change affected DADT, Republicans would become more interested in it.

But now there is hope. Maybe. After the health insurance bill, and the jobs bill, and the upcoming bank reform bill, could we actually have a climate and energy bill? And would this bill be any good? I am going to write more about this as more information comes out, but here are the preliminary details of the Kerry-Graham-Lieberman clean energy bill. There is a useful side-by-side of this bill, the House ACES bill, and POTUS Obama’s proposal. The best thing I can say about KGL is that it includes a “linked carbon fuel fee” which sounds a lot like a carbon tax. Neither the Obama nor the Waxman-Markey bills contain any mention of a carbon tax, they are both pure cap-and-trade proposals. I am a big proponent of a carbon tax (if you have read a recent post, you know I am in favor of any vice tax) over a cap-and-trade system which I think will be too complicated to enforce, and not very effective at changing consumer lifestyles and behaviors. A “professional” environmental activist told me just this weekend that a carbon tax has “Absolutely zero political legs. None. Negative.” So for now, I will have to satisfy myself with the KGL language which probably isn’t a carbon tax but at least sounds like it could potentially be one. I am sure I will write more about carbon tax in a future post. The thing I found saddest (although I guess that is a relative term) is amount of projected overall investment: $100bn over 10 years according to POTUS, $150bn over the same in WM, and TBA in KGL. Anyways, really people? $150bn? That’s it? $940bn to insure 32mn uninsured Americans and only $150bn to save 300mn Americans from hell on earth? $1tn (is that trillion) over 10 years to save us from imaginary Iraqi WMDs but only $150bn to save us from multiple future Katrinas? $182bn to save “too big to fail” AIG and only $150bn to save the planet? Perhaps the planet is not too big to fail! Hey, we’ll always have Jupiter!

Anyways, expect to hear a lot more from me about this in the coming weeks.

P.S. An American would never do this. Either of it.

P.P.S. On the advice of aquaman 2.0, I have switched routines to 1000 meters followed by 10 100-meter sprints. So far, so good. Although I might be hooking up with a “total immersion” trainer soon.

P.P.P.S. What is the Vegas line on the number of days left in Mike Steele’s RNC chairmanship? 4.5? Give me the under.