Steve -Grateful to have an open conversation, I continued:
Thank for your note, this is clearly something you're passionate about, and something on which we'll have to agree to disagree. You might read this article in the Washington Post though, and observe that others are making precisely the same points I did in the article you referenced. http://www.washingtonpost.com/wp-dyn/content/article/2008/11/24/AR2008112403211.html?hpid=topnews
Best,
Ken
Ken, thank you so much for taking time to reply, and for the link to the article. I truly appreciate the effort. And yes, we will agree to disagree. No doubt analysts and experts will continue to make the same/similar points as you, just as many will see it from my side as well.
But rather than just disagreeing, do you think there is anything here worth discussing? I sure would like to know what exactly it is about your point of view that you are so attached to. And I don't see you proposing any solutions.
For instance, I make the statement that finding the point of "optimization", rather than extreme efficiency or extreme profitability, might be a more prudent approach. See attached .pdf
Honestly, I don't believe hybrids, as they are today, are anywhere near the answer. Heck, the carbon footprint of one Prius alone cannot be offset by it expected useful life. But it is a bridge to new technology and new consumer behavior.
Other AFVs have promise, but widespread adoption is far down the road. Additionally, the biofuel industry is still in its infancy and there is little understanding/consensus/policy yet of the best way to incorporate them.
For instance, with biodiesel, B2, B5 and B20 (the number represents the percent of biodiesel blended with petroleum) all represent a step in the right direction for a number of reasons- lower emissions, higher lubricity, displacing petroleum consumption, etc. But the infrastructure isn't there to support it yet (both producer, distributor and seller).
Same with ethanol. 10% ethanol is in just about all gasoline sold and can run in any gasoline engine with modification, but provides no real benefit in terms of lower emissions or reducing petroleum consumption. E85, on the other hand, is pretty hard to come by- and there are relatively few vehicles that can actually run on the stuff due to materials compatibilities issues. It also has such a dramatically lower energy content that it takes MORE to do the same job. So while it lowers emissions and reduces petroleum consumption, it is wasteful because more fuel is used to accomplish the same work. In my mind, these are extremes that make little sense in terms of optimal solutions.
However, studies reported by ethanol.org (http://www.ethanol.org/pdf/contentmgmt/Press_Release_12507-1.pdf) show that 20 to 30% ethanol is a better blend for maximum performance, lower consumption, emission reduction and cost, and it can in most of today's cars without adverse mechanical effects.
Same with biodiesel. B20 to B30 is optimal in terms of infrastructure/equipment compatibility, maximum performance, lower consumption, emission reduction and cost.
These are the real short term fixes that will give us enough time to make the next leap in AFVs.
Rather than embrace these solutions, what are we to do... nothing? Status quo? Just because "the economy" is in the toilet?
One reason the economy is in the toilet is because current thinking and practices just aren't working. It isn't sustainable. And the system broke!
Are you familiar with the idea of predators growing so big, so dominant, that they eventually drive themselves to extinction by consuming everything around it and having nothing left to feed on? It's not a stretch to see that's where Detroit is headed.
Detroit needs to embrace this opportunity to optimize. To educate consumers with truths, not truthiness. To become socially responsible and sustainable. To tell the labor unions that enough is enough, and to stop the bleeding caused by unsustainable contracts (http://wsjclassroom.com/archive/06may/auto2_jobsbank.htm) and pension plans. To invest in retraining workers. To cross-train workers, maybe with other businesses/industries, to be useful/productive across multiple disciplines. The answers are out there!
Oh, and don't forget to implement a "pay for performance" initiative ACROSS THE BOARD- from the CEO to the janitor. Remove all unreasonably insane base pay and bonus structures, remove all golden parachutes, and let everyone know that if you suck at your job, you don't get paid at all.
You know, I'm thinking that all the money saved just by these corrective practices alone would be more than enough to pay for retraining/education, as well as universal health care for all workers- especially if the people were educated in eating healthier, getting more exercise and practiced a philosophy of proactive wellness rather than reactive illness management.
Great to have you as a sounding board, and I welcome any elaboration you might offer to discuss my comments.
Regards,
sg
Literally, less than 30 minutes later, he had gotten back to me with this:
Steve -
You raise many interesting areas of discussion, but I suspect that we come from such a diverse way of seeing the world, we could discuss these things for days, or weeks, without gaining any significant agreement. Still, in the interests of civil discourse, my world-view in a nutshell:
1) People seek to satisfy their basic needs, ala Maslow. They want housing, food, potable water, breathable air, education, healthcare, gainful employment, and so on. (Note that I did not say "pure air or pure water," such purity ranks far below other needs for most people in the world). Environmental protection generally ranks low on this list, and is really only affordable by people who are significantly wealthy, which is why real environmentalists want the world to get rich as quickly as possible, and not slow it down.
2) The best system yet developed to provide more people with more of those needs than any other according to the expressed will of the people is democratic capitalism. Yes, it has some unpleasant side effects, such as disparities of wealth, capacity for abuse, and so on, but to paraphrase Winston Churchill, Democratic Capitalism is the worst system except for all the other systems. Democratic Capitalism has generally swept the world, and the countries that generate the most wealth are invariably capitalist democracies. A few countries that generate wealth comparable to capitalist democracies are usually natural resource exporters, whose societies have far worse inequities.
3) For Americans to compete in environment of democratic capitalism, where many billions of people are willing to work for far less, we must be more efficient in other ways, which includes getting the cheapest energy available to us and using it up before going to any more expensive form of energy. The same is true for transportation (which is how we get goods to market, and how we provide the services people need to let them be more productive than workers in other countries). It's also true of our input goods, the food we eat, and everything else: low-cost makes for greater competitive advantage than high cost.
4) If the US raises its cost of energy, goods, and services compared to other countries we will lose competitive ability, and lose the very economic productivity that has allowed us to control pollution better than the developing world, and to set aside vast areas of parkland and wilderness rather than consume them, harming the many species therein.
So, bringing this home to our starting subject. The only people who know what car is right for them, to let them compete effectively as individuals, and for us as a society, are the individuals themselves, making their choices on a free market. The more the government interferes in that market, the less efficient the decisionmaking will be, and the less well off we will all be as a society. What the government should do in the car market is to get out. Rip out the subsidies to energy, transportation, and everything else, and let markets do what they do best: allocating resources to their most efficient use.
Best,
Ken
To which I replied:
Ken, YOU ROCK! Great conversation. I had a blast reading your world-view. See my comments accordingly, and we'll call it good. Have a wonderful Thanksgiving.
Kenneth Green wrote:
Just as the supreme court evaluates our constitution in terms of it's implications on today's society, we must also look critically at all generally accepted theories/areas of study and interpret/analyze them in terms of today's world.Steve -
You raise many interesting areas of discussion, but I suspect that we come from such a diverse way of seeing the world, we could discuss these things for days, or weeks, without gaining any significant agreement. Still, in the interests of civil discourse, my world-view in a nutshell:
1) People seek to satisfy their basic needs, ala Maslow. They want housing, food, potable water, breathable air, education, healthcare, gainful employment, and so on. (Note that I did not say "pure air or pure water," such purity ranks far below other needs for most people in the world). Environmental protection generally ranks low on this list, and is really only affordable by people who are significantly wealthy, which is why real environmentalists want the world to get rich as quickly as possible, and not slow it down.
Maslow- physiological, safety love/belonging, esteem, self-actualization.
Just above the basic physiological needs ("air" and "water"), you'll find safety- which includes safety of resources and health. In this sense, I'd argue that environmental protection- "clean air" and "clean water"- actually ranks very high, as it falls within the second level of basic needs.
Additionally, getting "rich" fast is usually done "at any cost". And just like "efficiency" at any cost, these courses of action are simply not sustainable in the long run. In fact, far too many of the "rich" in our society have gotten rich by running businesses that, while they may have followed the letter of the law, they haven't truly protected the environment as much as they could/should have. And many have skirted environmental laws all together and done more harm than good. Some get caught, but some don't. Illegal dumping, water contamination, exposure to workers, etc. are all ways to cut cost, and get rich.
I agree, the market can help weed out these bad seeds, but not before the damage is done. That's the highest cost of all.
Further, these "rich people", when they become rich, tend to live to excess, which in it's very essence, is the antithesis of environmental stewardship. Real environmentalists don't want the world to get rich, they want the world to do the most good what they have, with what's available and more importantly, with what they can do without. A Consumption Conscience, if you will.
And worse yet, when people are "on their way" to becoming rich, they tend to live way outside their means just to give the impression that they have already achieved a level of status. This type of reckless behavior only perpetuates the lack of environmental concern.
You have very little argument from me on these points. But free-market capitalism, democratic or not, will always benefit the individual over the society. Heck, just look at all the worthless junk consumers are programmed to consume! Bad for landfills, bad for pollution, bad for health, bad for the economy in the long run and thus bad for society as a whole. But someone is making a buck selling it!2) The best system yet developed to provide more people with more of those needs than any other according to the expressed will of the people is democratic capitalism. Yes, it has some unpleasant side effects, such as disparities of wealth, capacity for abuse, and so on, but to paraphrase Winston Churchill, Democratic Capitalism is the worst system except for all the other systems. Democratic Capitalism has generally swept the world, and the countries that generate the most wealth are invariably capitalist democracies. A few countries that generate wealth comparable to capitalist democracies are usually natural resource exporters, whose societies have far worse inequities.
We all want a certain standard of living. But everyone's definition of "standard of living" differs. Wealth generation is not the problem. The problem, or "unpleasant side effect", is the disproportionate wealth generation, led by the elite who tend to protect themselves by either buying protective legislation (tax law and otherwise) or buying lawyers to defend, without conscience or concern for anything other than protecting their own wealth.
People will be people, and human behavior is what it is. But at some point, a proactive effort must be made, led by both the top (our leaders- business AND government), as well as grass-roots efforts (local community organizers, NFPs, NGOs, etc), to promote and foster a real shift in our priorities. We've been programmed to consume (http://www.storyofstuff.com/)... why not reprogram with other areas of focus- such as conservation and optimization.
3) For Americans to compete in environment of democratic capitalism, where many billions of people are willing to work for far less, we must be more efficient in other ways, which includes getting the cheapest energy available to us and using it up before going to any more expensive form of energy. The same is true for transportation (which is how we get goods to market, and how we provide the services people need to let them be more productive than workers in other countries). It's also true of our input goods, the food we eat, and everything else: low-cost makes for greater competitive advantage than high cost.
You use the word "efficient", which is really a misnomer, as it doesn't tell the whole story. Efficiency, in it's essence, sacrifices something. In your example, we are sacrificing cleaner, renewable energy for "quick and dirty" energy just because it's cheaper. But in the end, something always suffers, and thus costs more.
Lets take human health, for instance. It may be "super efficient" in terms of the time it takes for a person to "have a meal" (eat a quick burger, fries and coke- 3 minutes in the drive thru, 5 to 10 minutes down the hatch), but at what human cost? Nutritional value is nearly zero, and counterproductive properties including high levels of fat, LDL cholesterol, bovine growth hormone and high-fructose corn syrup are off the scale. The "intangible" costs are that we suffer from obesity, diabetes, heart disease, and are generally unhealthy just because we've found a way to eat fast.
So, is it really "efficient" to eat like this? Of course not. Not unless we counterbalance the unhealthy effects with acts of healthiness- such as incorporating more nutritional elements into our diets, getting some exercise and eating in moderation. The problem is that not everyone takes the time to counterbalance the effects. It takes too much effort, and we are lazy.
In terms of cheap energy (coal, oil, etc), the "efficiencies" of low cost are more than out paced by the negative toll on the plant and human health. Not only are we not doing enough to counterbalance the effects, because "they cost too much", we aren't even doing the things that inherently cost less, such as simply reducing consumption.
How about this equation... how much acid rain, smog, asthma, autism and death, does it take to add up to, "we just can't do this any more"?
And you say, "use it up" before going to more expensive energy? WOW! Use it up? Since when has being "all-consumptive" ever led to anything good? Hunting/fishing to depletion/extinction, over eating, addictive use of drugs/alcohol, etc?
Very interesting argument. However, I say we will lose competitive ability AND our standard of living (parkland and wilderness), regardless of costs compared to other countries abroad, if we don't reinvest in infrastructure, reduce our consumption, become more "frugal" in terms of energy usage, and demand cleaner, renewable energy. Basically, we need to accept responsibility for our presence on this planet.4) If the US raises its cost of energy, goods, and services compared to other countries we will lose competitive ability, and lose the very economic productivity that has allowed us to control pollution better than the developing world, and to set aside vast areas of parkland and wilderness rather than consume them, harming the many species therein.
We, as a people, are to a point in our evolution that we can no longer simply rely on financial profitability to drive our development. We must start doing things because they just need to be done. That doesn't lower anyone's standards, it raises everyone's.
Have you considered the amount of money spent on the cost of waging war, let alone the loss in human capital?
If the amount of $$$ spent on Iraq and Afghanistan (including wasted, lost, and over-billed by war profiteers such as Haliburton) would have been used as reinvestment on infrastructure at home, or even constructive foreign aid (rather than destructive), we would be able to help raise the bar across the board. I'm not talking about spreading-the-wealth, I'm talking about reinvesting in infrastructure and people in terms of education and standard of living.
But... when things are a bad idea, we as a society have generally accepted principles, guidelines and standards of conduct, as well as laws, intended to keep individuals from harming themselves as well as others. Example: Even though we have an individual constitutional right to free speech, we can't/shouldn't yell "fire" in a crowded theater if there's really no fire, right?So, bringing this home to our starting subject. The only people who know what car is right for them, to let them compete effectively as individuals, and for us as a society, are the individuals themselves, making their choices on a free market.
Even though we have the right to drive whatever we want (as long as the vehicle is "legal" and road worthy), it is now generally accepted that 7mpg is a bad idea. Thing is, 7mpg was ALWAYS a bad idea. As individuals, we've told Detroit to give us better MPG vehicles. But they have refused to do it because they know we are so dependent on our cars and trucks, that we will buy whatever they make.
We may not drive them as much with high fuel prices, but we will still buy them. They know it. The bank on it.
So at some point, we need to have our elected officials speak for us, and demand accountability from industry. Anti-trust laws, labor laws, whatever. If tacking on environmental criteria to a financial bail-out is part of that, then good! Tax dollars being used responsibly for once. By mandating environmental guidelines, we as people are simply now telling Detroit, through our representative government, that we want them to stay on task and not buckle under the pressure of maximizing profit. Be innovative. Find a way to do it better. Representation by the people, for the people!
Just curious, were SUVs always so profitable, or is there a cost curve showing that they were in the red once upon a time. Or maybe the Big Three relied on "creative financing" to perpetuate the gorging, http://blogs.ft.com/gapperblog/2008/07/were-suvs-such-profitable-products-after-all/
And did we ever really need SUVs? Just because gas was cheap, did we need to guzzle as much as possible? The current condition/state of the auto industry is the best argument proving that this course of action, though profitable in the short run, was in fact a REALLY BAD IDEA over all.
Finally, something we completely agree on! Government interference in any market can be counterproductive, especially if bureaucratic red-tape and unnecessary complications get in the way. But since we know government won't get out, we as individuals within this representative capitalistic democracy, need to demand accountability and push our leaders to mandate our interests in terms of policy and enforcement.The more the government interferes in that market, the less efficient the decisionmaking will be, and the less well off we will all be as a society. What the government should do in the car market is to get out. Rip out the subsidies to energy, transportation, and everything else, and let markets do what they do best: allocating resources to their most efficient use.
And again, "more efficient" or "less efficient"is relative to what is given up in the process. Do you really believe we're much better off as a society guzzling fuel, spewing emissions, and consuming everything in sight just for the financial profitability of it?
APATHY AND INDIFFERENCE IS THE REAL ENEMY. I THINK YOU AND I CAN AGREE THAT IT IS OUR RESPONSIBILITY, AS CITIZENS AND PEOPLES OF THIS LAND, TO SIMPLY HOLD ACCOUNTABLE ALL OF OUR LEADERS- BUSINESS, GOVERNMENT, SPIRITUAL AND OTHERWISE.
THAT'S THE REAL MARKET!
PEACE.
SG
And there you have it. I'm guess we didn't solve any of the worlds problems... yet, but at least a conversation like this is "out there" now, and hopefully causing other to pause for a moment, take stock in the BIG PICTURE, and decide for themselves just what kind of world they want to live in. sg
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