Could a pact for growth actually avert world depression? How?
It was a great relief for me this past week or two to see that Europe is finally displaying some higher-level consciousness of its real urgent needs. The new President of France, Hollande, and the Financial Times (FT) have both talked about the need for a new "pact for growth" to prevent and even reverse the rise of unemployment in Europe, which otherwise seriously threatens a 1930's style depression spreading to the entire world.
The key question: do they have any hope of actually pulling it off? With a very complex systems issue like this, ordinary reactive thinking just won't work. NO ONE can write about all the key issues here while being explicit about ALL the important details, but
I can begin to see more of the glimmerings of how they COULD cut the Gordian knot, if they chose to do so. But there is a whole lot of tunnel vision among the official great experts working on this, and I don;t know what their chances of finding these glimmering for themselves.
There are two especially interesting core principles which could provide a way out:
(1) As FT notes, the EU could start to try to think about the problem of growth in Europe AS IF they already had a United States of Europe, and could use all the best techniques we have used here (which are in need of improvement but have been working out a whole lot better than Greece, Spain, Italy, France, UK and eurozone as a whole...). We have a lot of very substantive prior thought that could be transferred.
I am not proposing starting by actually creating a United States of Europe (though my PhD thesis advisor, Karl Deutsch, would have been delighted about that); rather I am proposing that we/they analyze what could be done, and then try to work out the smoothest way to get the same effect.
(2) Given that EU, the US and the provinces of China all have similar levels of debt problem, we are all limited in how fast we can return to growth, because we need to protect ourselves from the world financial community (us!). It's a classic prisoner's dilemma situation. To get to a Pareto optimum (growth as fast as we could get if we were all one nation, without the bad politics that would mean in practice)... we need something like a "G4 pact," a kind of economic nonaggression treaty, built on a foundation of very close intense and deep discussions of at least US, EU, China and Brazil. Brazil is not in the same debt position, and makes the discusison more complex -- and that's precisely why they need to be there, just as new web pages needed to be tested against different kinds of browsers before going public.
===
I don't have this nailed even at the intellectual level, but some themes seem to emerge...
BOTH for the new G4 pact, AND for the EU, there is a kind of "Greece problem."
Common sense suggests -- the pact should be to cut each other some slack, ESPECIALLY
on interest rates for sovereign debt, BUT ALL TO AN EQUAL EXTENT. The idea is to tune up world demand, not to subsidize governments which do not live beyond their means.
Of course, it is interesting to compare states of the US versus provinces of China in this regard... but let me stay with the big picture for now.
To balance this out, things like the Greek problem (and potential imbalances within the G4, where Brazil acts to some extent as a surrogate or leader for more nations)..
would be dealt with by raising demand, to prevent waste, IN THE AFFECTED region BUT NOT BY THE GOVERNMENT of that region. I think a little of things like the Appalachian
Commission and the Epscor program in the US. These things may be public or private or a mix of both, but they must be transnational kinds of activity which channel demand to areas where there is a certain kind of imbalance, a kind of waste of human or economic resources. Of course, people have talked about development funds for many decades at least, but it seems that maybe a new context could let us re-examine such issues with fresh eyes.
Of course, the idea that such transnational programs might build giant solar farms
in Southern Europe using the new 7 cents per kwh solar thermal technology I happen to know about (thanks to excellent sources of information on technology and on what to believe) still makes sense... if a transnational fund could be set up which is capable
of occasional flashes of competence that way. (The US and China themselves have not reached that stage of competence yet itself... but it's important that we keep trying; a lot is at stake.)
That can apply, in fact, at national, regional, and provincial levels...
and the challenge is how to do it more by reliable types of formulas rather than corrupt stakeholder stuff (the bane of many development funds). Even with NSF's Epscor program, I have often thought about how the present information channels are useful, but actual funding decisions by automatic immediate 50% matching without side criteria
could result in much greater efficiency overall, whatever the apparent levels of overall funding.
But there is still more to be said about risk management and representation systems (or "plays") to better factor risk in this kind of complex world. The discussion above
needs to be integrated somehow with more of that.
============
=========
As for what we have learned WITHIN the US....
1. In a Nash equilibrium, maybe the Tea Party solution would be best, even though it would help us join Europe in approaching a rerun of the 1930's. With a G4 pact, we can avoid that rerun, if we have the will to do so. and are rational enough to make full use of the breathing space and slack that buys us. (But as we waste the slack we get from fracking, and use it just to dig ourselves into a deeper hole, there is reason to worry.)
One of the European commentators recently said: "Hey, we agreed with Hollande that we will do as much as we can for growth, within the limits of the austerity agreemnet which even he says he will uphold. Hey, OK, he will get all the empty sound bites he needs, but let's be real. How can you get growth in the face of austerity?"
But in fact, we got very deep into that here a year or two ago. Obama may have only a 50% grade or so on that kind of sophisticated juggling act... but 50% is ever so much more than anyone else. (I suppose China is also running at about 50% efficiency, not because they understand this juggling act, but because of the inertia of a highly efficient starting point.) ONE PART of Japan's economic recovery plan in 2009 was
much more efficient... but there were other parts, and there has been an earthquake...
One key point... which the old school idiots need to really understand... it is simply not true that X dollars in government deficit in one sector yields the same stimulus as X dollars in another sector. Simply by shifting commitments from one sector to another, one can substantially increase stimulus without increasing government dollar commitment. Merkel's own cash for clunkers program is a great example of this, yielding
about three times the stimulus per dollar as normal government spending, which in turn does about twice what the more dubious tax breaks would provide, which the "job creators" (i.e. PAC fat cats) have been pushing for. Japan's "three pillars of eco..."
are like Merkel's cash for clunkers that way. An EU-wide program based on those three pillars (e.g. the stimulative parts of the 18-page bill posted at www.werbos.com/oil.htm) could go a very long way that way, as would relative incentives
for utility solar farms. And of course to talk about growth without supporting education would be a gross nonsequitur.
But... in a world of legal corruption... I often think about Syn Rand, where the DC (and Brussels) lobbyists who represent certain big companies may be very effectively digging their own graves, as well as ours.
Would Romney be any better than Obama in resisting those negative forces threatening to pull us apart, or would he a gleeful uninhibited gateway to expanded corporate welfare for the PACmen? Will he streamline the financial system, or will he just give the federal reserve as a kind of election spoils to a drunken arsonist from his base? His choice of VP will tell us a lot. If he picks any of the Washington insiders which the press has been talking about, he could be a threat to our very existence, at this delicate time. (Of course the woman they fired from HP would not be any better.) But
there is hope...
=====================
======================
As I post this, two more thoughts come to mind:
1. For US or EU:
Why not "incentive pay for the top 1%?"
Obama has rightly argued that it would be better to sacrifice new optional tax breaks introduced by Bush, rather than sacrifice public education, which Thomas Jefferson rightly promoted as a sacred bedrock of our nation. The tax breaks for the rich do not help aggregate demand so much as most other ways of using the money. But if we DO
ever get out of high unemployment and deep debt, then we will be able to afford it again.
So instead of fighting over this stuff every year, to adapt to changing conditions..why not make it into a FORMULA? After all, we have CPI formulas in the law.
Why not have a formula which adjusts the tax rates for the rich, as function of the basic economic strength of the nation (rates of employment, growth and debt)?
We could use one more automatic stabilizer...
2. As part of this, of course, using housing as a kind of yoyo regulator ..
may not be the best stabilizer...
===========
================
Byeond that,
Friday, May 11, 2012
Tuesday, May 1, 2012
Could the Navy help warn us of possible human extinction?
Sent to a list which include some folks high up in making policy for the military:
=======================================
Since some of you have good contacts with the Navy --
A long-term friend of mine, deeply concerned about global climate change,
has suggested that the Navy might have a role to play in reducing our woeful ignorance
about ocean phenomena which might threaten our lives more seriously than warming or ocean acidification do.
I would be interested in your thoughts about how one should follow up.
By way of introduction -- Rod was formerly one of the most important partners in Arthur Anderson,
in the good part of the company, training people in how to use systems thinking and systems methods
in managing Fortune 500 companies, and also providing these companies with in-depth unbiased information about climate change.
Rod's current idea, at the top of the trail below, builds on previous discussion. In essence,
the email trail makes sense if you read from bottom to top. (From item 1, to 2, to 3, to 4).
Best regards,
Paul
4 ==================================================
From: Rod
To: 'Paul Werbos'
Paul,
When I was focusing on the NAO THC issue based largely on work out of the
Potsdam Institute George Klir referred to me a former systems science PhD
student of his who is an expert on thermohaline. At that time he worked at
the Naval Warfare Research Center and no doubt they have an interest in
hiding (or finding) submarines within thermohaline layers.
Maybe it is time to turn "swords into plowshares".
Any ideas?
Rod
3 ======================================
-----Original Message-----
From: Paul
Hi, Rod!
On Apr 30, 2012, at 6:23 PM, Rod wrote:
Paul,
Here is the link to the Nature abstract:
http://www.nature.com/ngeo/journal/v5/n5/full/ngeo1452.html
I do not enjoy a subscription at the moment but perhaps your
organization does. There are some informative charts in the abstract.
When I go to the web site, I see all three pages, which seems to have
everything.
To be sure, I clicked on "pdf," and then downloaded the article. But It was
still just the same three pages.
What troubles me about this finding is the vastness of the
(diminishing) Arctic Sea ice. I remember reading (maybe Arctic Dreams
by Barry Lopez) years ago that there are many microorganisms living
under the sea ice that are not normally living in the open sea (archaea?).
It's amazing how little science really understands even now about some of
the basics of life on earth.
When I started this job, circa 1990, I remember a guy from Wood's Hole who
reported a success story with neural networks:
"Thanks to neural networks, we were able to detect two new types of microbe
in the ocean this year. By the way, these two types account for about 90% of
the biomass of the ocean." Quite a zinger.
He explained a bit more (about how hard it had been to do this kind of
study), but still I wondered.
In 2009, when working on climate stuff, I read up a bit more on archaea.
People had recently believed they were relatively rare, mainly in deep open
trenches and such. "Extremophiles." But it seems they may be about half of
the biomass of the ordinary ocean, in modern up-to-date work (though of
course there is a lot of textbook lag, not as bad as what we have in my
field, but still noticeable.) And maybe they are 90% of the biomass below the sea bed, where the
amount of biomass is far greater than people used to think. These are
general impressions from the current literature, but are of course not a
mature equilibrium of analysis. (Others would know more .. but many know less
who depend on older information.)
Archaea as a group are amazingly adaptable. And what they do to us depends a
lot on what we do to them. They certainly were implicated in all the
extinctions (except perhaps the one based on a comet) in Ward's history of
the earth. They are the main source of H2S and of methane.
For mass extinction purposes, both via methane or via H2S (direct or via
ozone depletion), there are two key drivers: (1) how much do the archaea
produce; and
(2) how much escapes to the atmosphere. Low levels of oxygen and nutrients
in the water seem to be the main drivers of (1), and those in turn are
heavily influenced by ocean currents and nutrient runoff from the land.
It does worry me that we don't seem to have a basic handle on the basics of
where we might be going in the fluxes of this system.
As Ward says, the study of thermohaline currents seems to be relatively
static, from what I have seen, without the kind of generalization and data
which would give us early warning of possible disasters.
The political advocacy types seem to view Ward as "just another footnote to
support our concern about ocean acidification," which may be worse in its
way than the fundamentalist climate deniers who at least know that they are
shutting their eyes and putting their heads in the sand.
Best of luck... to us all... we need it...
Paul
It is important to remember that as recently as the 16th century (and
maybe
later) sea ice completely surrounded Iceland, and "Eskimos" were
spotted in kayaks in Scotland. So the total sea ice cover diminished
greatly from its 16th century peak, and is diminishing greatly again now.
In any event I can only hope the methane studies continue to be funded
as this may be very high on the list of planetary challenges.
Rod
2 ==================================================================
From: Paul
Subject: Re: NASA finds new potential source of CH4
Thanks, Rod!
I literally felt a chill up my spine as I read your email, and clicked
on the link.
My immediate thought as I read what you said: "If it's from open ocean
and not from permafrost or clathrates... that leaves just one
possibility..."
And on a very quick glance the story says what seems obvious: what
else could it be but living things in the ocean?
Of course, I certainly don't know at this point... but the words which
popped into my mind immediately were:
methanogen archaea.
If we are already seeing a big expansion of archaea ... that's the key
final stage leading to the death-by-H2S and
death-by-renewed-ozone-depletion scenarios.
But certainly it is 'way premature to say we know what is going on.
For example, I didn't see a time-series in this story.
But if the kind of mechanisms that Kemp and Ward talk about are
actually getting started in the Arctic Ocean..
I guess I shouldn't have just limited the discussion to the North
Atlantic and North Pacific as I did in my posting to Jerry.
(Also, I hope that the obvious issue with the Black Sea is not large
enough to be relevant to the ozone issue.) Yet Ward's book suggests
that the North Atlantic by itself was already enough to explain the
massive extinctions at the end of the eocene.
Who knows? I guess we really ought to keep our eyes open here....
Best regards,
Paul
1 =================================
On Thu, Apr 26, 2012 at 10:37 PM, Rod wrote:
Data collection over open water of the Arctic Ocean shows elevated
levels of
CH4 that NASA believes may be from the ocean water and not from
melting permafrost or methane clathrate deposits on the sea floor.
This source of
CH4 could potentially be large and bears further study.
http://www.nasa.gov/topics/earth/features/earth20120422.html
=======================================
Since some of you have good contacts with the Navy --
A long-term friend of mine, deeply concerned about global climate change,
has suggested that the Navy might have a role to play in reducing our woeful ignorance
about ocean phenomena which might threaten our lives more seriously than warming or ocean acidification do.
I would be interested in your thoughts about how one should follow up.
By way of introduction -- Rod was formerly one of the most important partners in Arthur Anderson,
in the good part of the company, training people in how to use systems thinking and systems methods
in managing Fortune 500 companies, and also providing these companies with in-depth unbiased information about climate change.
Rod's current idea, at the top of the trail below, builds on previous discussion. In essence,
the email trail makes sense if you read from bottom to top. (From item 1, to 2, to 3, to 4).
Best regards,
Paul
4 ==================================================
From: Rod
To: 'Paul Werbos'
Paul,
When I was focusing on the NAO THC issue based largely on work out of the
Potsdam Institute George Klir referred to me a former systems science PhD
student of his who is an expert on thermohaline. At that time he worked at
the Naval Warfare Research Center and no doubt they have an interest in
hiding (or finding) submarines within thermohaline layers.
Maybe it is time to turn "swords into plowshares".
Any ideas?
Rod
3 ======================================
-----Original Message-----
From: Paul
Hi, Rod!
On Apr 30, 2012, at 6:23 PM, Rod wrote:
Paul,
Here is the link to the Nature abstract:
http://www.nature.com/ngeo/journal/v5/n5/full/ngeo1452.html
I do not enjoy a subscription at the moment but perhaps your
organization does. There are some informative charts in the abstract.
When I go to the web site, I see all three pages, which seems to have
everything.
To be sure, I clicked on "pdf," and then downloaded the article. But It was
still just the same three pages.
What troubles me about this finding is the vastness of the
(diminishing) Arctic Sea ice. I remember reading (maybe Arctic Dreams
by Barry Lopez) years ago that there are many microorganisms living
under the sea ice that are not normally living in the open sea (archaea?).
It's amazing how little science really understands even now about some of
the basics of life on earth.
When I started this job, circa 1990, I remember a guy from Wood's Hole who
reported a success story with neural networks:
"Thanks to neural networks, we were able to detect two new types of microbe
in the ocean this year. By the way, these two types account for about 90% of
the biomass of the ocean." Quite a zinger.
He explained a bit more (about how hard it had been to do this kind of
study), but still I wondered.
In 2009, when working on climate stuff, I read up a bit more on archaea.
People had recently believed they were relatively rare, mainly in deep open
trenches and such. "Extremophiles." But it seems they may be about half of
the biomass of the ordinary ocean, in modern up-to-date work (though of
course there is a lot of textbook lag, not as bad as what we have in my
field, but still noticeable.) And maybe they are 90% of the biomass below the sea bed, where the
amount of biomass is far greater than people used to think. These are
general impressions from the current literature, but are of course not a
mature equilibrium of analysis. (Others would know more .. but many know less
who depend on older information.)
Archaea as a group are amazingly adaptable. And what they do to us depends a
lot on what we do to them. They certainly were implicated in all the
extinctions (except perhaps the one based on a comet) in Ward's history of
the earth. They are the main source of H2S and of methane.
For mass extinction purposes, both via methane or via H2S (direct or via
ozone depletion), there are two key drivers: (1) how much do the archaea
produce; and
(2) how much escapes to the atmosphere. Low levels of oxygen and nutrients
in the water seem to be the main drivers of (1), and those in turn are
heavily influenced by ocean currents and nutrient runoff from the land.
It does worry me that we don't seem to have a basic handle on the basics of
where we might be going in the fluxes of this system.
As Ward says, the study of thermohaline currents seems to be relatively
static, from what I have seen, without the kind of generalization and data
which would give us early warning of possible disasters.
The political advocacy types seem to view Ward as "just another footnote to
support our concern about ocean acidification," which may be worse in its
way than the fundamentalist climate deniers who at least know that they are
shutting their eyes and putting their heads in the sand.
Best of luck... to us all... we need it...
Paul
It is important to remember that as recently as the 16th century (and
maybe
later) sea ice completely surrounded Iceland, and "Eskimos" were
spotted in kayaks in Scotland. So the total sea ice cover diminished
greatly from its 16th century peak, and is diminishing greatly again now.
In any event I can only hope the methane studies continue to be funded
as this may be very high on the list of planetary challenges.
Rod
2 ==================================================================
From: Paul
Subject: Re: NASA finds new potential source of CH4
Thanks, Rod!
I literally felt a chill up my spine as I read your email, and clicked
on the link.
My immediate thought as I read what you said: "If it's from open ocean
and not from permafrost or clathrates... that leaves just one
possibility..."
And on a very quick glance the story says what seems obvious: what
else could it be but living things in the ocean?
Of course, I certainly don't know at this point... but the words which
popped into my mind immediately were:
methanogen archaea.
If we are already seeing a big expansion of archaea ... that's the key
final stage leading to the death-by-H2S and
death-by-renewed-ozone-depletion scenarios.
But certainly it is 'way premature to say we know what is going on.
For example, I didn't see a time-series in this story.
But if the kind of mechanisms that Kemp and Ward talk about are
actually getting started in the Arctic Ocean..
I guess I shouldn't have just limited the discussion to the North
Atlantic and North Pacific as I did in my posting to Jerry.
(Also, I hope that the obvious issue with the Black Sea is not large
enough to be relevant to the ozone issue.) Yet Ward's book suggests
that the North Atlantic by itself was already enough to explain the
massive extinctions at the end of the eocene.
Who knows? I guess we really ought to keep our eyes open here....
Best regards,
Paul
1 =================================
On Thu, Apr 26, 2012 at 10:37 PM, Rod wrote:
Data collection over open water of the Arctic Ocean shows elevated
levels of
CH4 that NASA believes may be from the ocean water and not from
melting permafrost or methane clathrate deposits on the sea floor.
This source of
CH4 could potentially be large and bears further study.
http://www.nasa.gov/topics/earth/features/earth20120422.html
Wednesday, April 25, 2012
Obama versus Romney in space.. will cost kill the mining company?
A friend on a listserv commented on the Planetary Resources announcement yesterday:
>
>
> Hmm. Cant help but wonder what the costs of these asteroid resources will be. l wonder - will they be intended for government purchase, corporate purpose? A fair price would incorporate the cost of transport. .
>
That certainly is a real concern, which I mentioned briefly in my blog account.
In many ways, the technical and business plan is much better and more intelligent than other things I have seen
in the space industry space (not counting communication satellites or use of GPS). They have revenue
streams in place more than just selling nonterrestrial material (NTM). They rely on robotics to do the job with
lightweight payloads, which can hitch a ride at relatively low cost on any of a variety of other launches. It also turns
out to connect to a lot of technologies I've been directly involved in.
HOWEVER ... to bring back X kilos of nonterrestrial material to earth does involve a transport cost, and it does make me slightly queasy
that their plans do not seem to involve any effort at all to turn around the crisis we are facing on the cost of getting to space (low earth orbit) in the first place.
That crisis worries me a lot, as I've probably said here before.
Back in 2009, I tried to warn people that the Ares rockets which were the backbone of NASA's "return to the moon"
and space exploration in general were badly conceived antiquated technology, soon to expose huge excess of cost over what had been promised back in the days of Michael Griffin's 90-day plan which was grossly politically biased to come up with "the right answer" -- the answer which would
send the most jobs to Decatur. I found myself wondering whethe r Senator Mikulski understood that she is the chair of the relevant appropriations committee,
and did not have to put up with such incredibly gross waste. Ares didn't REALLY experience cost overruns; the problem was that the initial promises
were grossly dishonest. Expendable rockets are NOT cheaper than partially reusable systems like the space shuttle.
What surprises me now is that people have made such strong commitments to a "new" Space Launch System which takes the same approach, which is
a virtual clone of Ares, and just as expensive and wasteful.
There is a debate raging now. SHOULD the big aerospace companies and the space community offer to NASA something which has more
than twice the capability for the same development cost, since they do in fact know how to do better? Boeing was even brave enough
to put out feelers on a MUCH more cost-effective alternative, wh! ich would substantially enhance national security, in a story in Aviation Week
which I cite in my recent paper on this subject. (I wrote an invited paper for a Russian aerospace journal which just came out; the draft in English is posted
at http://vixra.org/abs/1112.0018.)
But the feeling out there is:
1. The politicians will not tolerate discussion of an option which would give the US more capability for the same cost.
They forwarded me a message from Launchspace which expresses the feelings of experts quite well:
===================================
Shuttle - RIP
(Launchspace Staff)
The Space Shuttle Program has ended on a sad note. Last week Discovery took a "victory lap" around the Washington Mall, riding on its carrier Boeing 747. However, this was hardly a victory for America's space program. After 30 years and well over 100 flights into space, shuttle orbiters are to become museum pieces. These will forever remind us of the once magnificent flying machines and the daredevil astronauts that rode them into the black vacuum of space. The sad part of this in that the end of the Space Shuttle Era is also the end of a once great US human space flight program. NASA has promised many follow-on exciting human space adventures, but credibility of the space agency is at an all-time low. NASA has devolved into little more than a jobs program, trying to keep thousands of excellent engineers and scientists busy, but with little vision or Administration support for continuing human exploration of the solar system and beyond. Once proud astronauts are now relegated to begging the Russians for rides on Soyuz launch vehicles, and at a very high price.
NASA is reduced to hoping that commercial space companies can replace the Russians and ferry astronauts to and from the ISS. Flights beyond ISS will await some new and undefined architecture that will require a new and very expensive expendable booster system, SLS, a booster system that will easily exceed the cost of operating the shuttle. It is not surprising that no one wants to pay for this new system. It appears to be a giant step backward to the days of the Apollo Saturn V. We might go so far as to say: "This is a small step backward for NASA, but a giant step backward for America's space program."
===============================================
2. There is a debate about what Romney would do about this. Is he in his heart a guy from Bian Capital who loves to fire people who don't perform, who
wants to get rid of any large-scale wasteful spending, who would be happy to zero out such a gross waste of money in the blink of an eye?
Or in his heart, is he the most compliant servant of fat cats and corruption in decades, a kind of new Taft, who has brought on the same old Griffin to
be his space advisor, who will continue to maintain the status quo of money going down the same rathole producing nothing, even as our real technical capabilities here go closer and closer to the cliff? In these discussions, I initially said the first... and cited Romney's speeches in Florida... but I have to admit that this is a kind of optimistic slant! on Romney, and the folks here overwhelmingly tend to assume the latter view... and are basing their actions on that assumption.
I(I wonder if Griffin has had a few quiet discussions with them behind closed doors.) No reduction in corporate welfare here, they all assume.
3. Still, the Administration itself is far form blameless. Maybe it was a lower level functionary being too clever...
I recently received an inquiry from Israel about the incredible scandal
http://www.foxnews.com/scitech/2012/04/23/pentagon-explains-why-hypersonic-mach-13-drone-failed/
Of course, you know about CYA: "We intended our new vehicle to explode in mid air. That was our plan all along."
because of security, I do not really know the true story, but I have been able to piece together a pretty good possibility.
DARPA HAD decided to go ahead with a global reach vehicle, to cost about $300 million, which would have incidentally solved our fundamental problem of affordable access to space (or at least made us capable of getting there cheaply, and prevented the imminent loss of that capability.)
But some idiot at a middle level thought they were clever by reducing costs, and getting rid of the effort to get the skin really right.
So they made a vehicle th! at melted.
Will Romney or Obama or their people ever lift a finger to get us back on track, in DARPA even if NASA is a lost cause?
For now, it looks more likely to me that Russia or China will make us look like incredible weak fools sooner than we expect...
but one can always hope... and make just a little noise...
Best of luck,
Paul
>
>
> Hmm. Cant help but wonder what the costs of these asteroid resources will be. l wonder - will they be intended for government purchase, corporate purpose? A fair price would incorporate the cost of transport. .
>
That certainly is a real concern, which I mentioned briefly in my blog account.
In many ways, the technical and business plan is much better and more intelligent than other things I have seen
in the space industry space (not counting communication satellites or use of GPS). They have revenue
streams in place more than just selling nonterrestrial material (NTM). They rely on robotics to do the job with
lightweight payloads, which can hitch a ride at relatively low cost on any of a variety of other launches. It also turns
out to connect to a lot of technologies I've been directly involved in.
HOWEVER ... to bring back X kilos of nonterrestrial material to earth does involve a transport cost, and it does make me slightly queasy
that their plans do not seem to involve any effort at all to turn around the crisis we are facing on the cost of getting to space (low earth orbit) in the first place.
That crisis worries me a lot, as I've probably said here before.
Back in 2009, I tried to warn people that the Ares rockets which were the backbone of NASA's "return to the moon"
and space exploration in general were badly conceived antiquated technology, soon to expose huge excess of cost over what had been promised back in the days of Michael Griffin's 90-day plan which was grossly politically biased to come up with "the right answer" -- the answer which would
send the most jobs to Decatur. I found myself wondering whethe r Senator Mikulski understood that she is the chair of the relevant appropriations committee,
and did not have to put up with such incredibly gross waste. Ares didn't REALLY experience cost overruns; the problem was that the initial promises
were grossly dishonest. Expendable rockets are NOT cheaper than partially reusable systems like the space shuttle.
What surprises me now is that people have made such strong commitments to a "new" Space Launch System which takes the same approach, which is
a virtual clone of Ares, and just as expensive and wasteful.
There is a debate raging now. SHOULD the big aerospace companies and the space community offer to NASA something which has more
than twice the capability for the same development cost, since they do in fact know how to do better? Boeing was even brave enough
to put out feelers on a MUCH more cost-effective alternative, wh! ich would substantially enhance national security, in a story in Aviation Week
which I cite in my recent paper on this subject. (I wrote an invited paper for a Russian aerospace journal which just came out; the draft in English is posted
at http://vixra.org/abs/1112.0018.)
But the feeling out there is:
1. The politicians will not tolerate discussion of an option which would give the US more capability for the same cost.
They forwarded me a message from Launchspace which expresses the feelings of experts quite well:
===================================
Shuttle - RIP
(Launchspace Staff)
The Space Shuttle Program has ended on a sad note. Last week Discovery took a "victory lap" around the Washington Mall, riding on its carrier Boeing 747. However, this was hardly a victory for America's space program. After 30 years and well over 100 flights into space, shuttle orbiters are to become museum pieces. These will forever remind us of the once magnificent flying machines and the daredevil astronauts that rode them into the black vacuum of space. The sad part of this in that the end of the Space Shuttle Era is also the end of a once great US human space flight program. NASA has promised many follow-on exciting human space adventures, but credibility of the space agency is at an all-time low. NASA has devolved into little more than a jobs program, trying to keep thousands of excellent engineers and scientists busy, but with little vision or Administration support for continuing human exploration of the solar system and beyond. Once proud astronauts are now relegated to begging the Russians for rides on Soyuz launch vehicles, and at a very high price.
NASA is reduced to hoping that commercial space companies can replace the Russians and ferry astronauts to and from the ISS. Flights beyond ISS will await some new and undefined architecture that will require a new and very expensive expendable booster system, SLS, a booster system that will easily exceed the cost of operating the shuttle. It is not surprising that no one wants to pay for this new system. It appears to be a giant step backward to the days of the Apollo Saturn V. We might go so far as to say: "This is a small step backward for NASA, but a giant step backward for America's space program."
===============================================
2. There is a debate about what Romney would do about this. Is he in his heart a guy from Bian Capital who loves to fire people who don't perform, who
wants to get rid of any large-scale wasteful spending, who would be happy to zero out such a gross waste of money in the blink of an eye?
Or in his heart, is he the most compliant servant of fat cats and corruption in decades, a kind of new Taft, who has brought on the same old Griffin to
be his space advisor, who will continue to maintain the status quo of money going down the same rathole producing nothing, even as our real technical capabilities here go closer and closer to the cliff? In these discussions, I initially said the first... and cited Romney's speeches in Florida... but I have to admit that this is a kind of optimistic slant! on Romney, and the folks here overwhelmingly tend to assume the latter view... and are basing their actions on that assumption.
I(I wonder if Griffin has had a few quiet discussions with them behind closed doors.) No reduction in corporate welfare here, they all assume.
3. Still, the Administration itself is far form blameless. Maybe it was a lower level functionary being too clever...
I recently received an inquiry from Israel about the incredible scandal
http://www.foxnews.com/scitech/2012/04/23/pentagon-explains-why-hypersonic-mach-13-drone-failed/
Of course, you know about CYA: "We intended our new vehicle to explode in mid air. That was our plan all along."
because of security, I do not really know the true story, but I have been able to piece together a pretty good possibility.
DARPA HAD decided to go ahead with a global reach vehicle, to cost about $300 million, which would have incidentally solved our fundamental problem of affordable access to space (or at least made us capable of getting there cheaply, and prevented the imminent loss of that capability.)
But some idiot at a middle level thought they were clever by reducing costs, and getting rid of the effort to get the skin really right.
So they made a vehicle th! at melted.
Will Romney or Obama or their people ever lift a finger to get us back on track, in DARPA even if NASA is a lost cause?
For now, it looks more likely to me that Russia or China will make us look like incredible weak fools sooner than we expect...
but one can always hope... and make just a little noise...
Best of luck,
Paul
Tuesday, April 24, 2012
Google invests in asteroid mining hardware work now
Today (4/24/2012) the newish company Planetary Resources held a big press conference announcing that their initial investment plan has been fully funded, by people like Larry P{age and half a dozen others, and has begun work on hardware. The basic plan is available, of course, at their web site. But there were a number of zingers.
First, it's mainly a robotics effort. They have a small team, but it's clear that the team posted on the web is less than half the full team. Moseley and other JPL people
clearly play a critical role. In listing key enabling technologies on the **IT** side,
crucial to success in these robotics... they basically referred to telescopes and
planetary rovers form JPL, but ALSO "medical devices and automotive." What does JPL do in automotive technology related to these goals? I can guess. For some kind of robotic control, the best chip available for many years was the chip developed by Mosaix, a spinoff or partner of JPL. Their initial contract with Ford was very widely publicized by JPL. But they developed a more powerful Phase II chip, under funding from me.
However, there is new stuff in the pipeline of the same family which will be far more powerful. I have a couple of chapters in press in the new books on memristors...
Robotic mining: in fact this was a major theme in JIETSSP, the funding initiative on space solar power which I led in 2002. (The last US government funding effort on energy from space.) The best really working technology for that did not come from JPL... It involved "teleautonomy." A key challenge was to
develop robotics skills... and that's basically a task for ADP, an area I have been pushing very hard to advance from NSF. But it has been a great struggle, given the resistance of old fashioned binary thinkers... still, the new book edited by Lewis and Liu, from IEEE Press, gives the best present state of the art. NASA Ames was a great center for this stuff, but Shelby's Apollo on steroids preserved jobs in Decatur by firing a lot of the key folks in California... (with no resistance at all by Boeing lobbyists)... weakening US technology in this area, but maybe freeing up some people for this venture.
The venture depends VERY heavily on hitching rides to get to earth orbit in the first place.
The ultimate costs will still be pretty much proportional to cost of getting from earth to LEO,
which this venture will do nothing to reduce. There is potential to reduce those costs a hundred fold. It would
be really great if they could join the meager efforts to make that happen... but the plan right now says nothing about that. These guys are quite competent, but none of today's launch service
efforts are within a factor of ten of what could be done for cost reduction in that area. My
new paper which just came out in Russian, invited by a Russian aerospace journal... gets somewhat into the real story, which is a long one.
Since Moseley was a telescope guy... no surprise that the first two phases, Arkyd (sp?) 100 and 200,
involve building space telescopes in Bellevue, Washington, and getting them into orbit. They plan six years of that. That's the real hardware, the real investment, for the next 5-6 years.
To "prospect." But they have dual use, and parallel cash streams are used to stay in the black.
Does this mean we get Google Earth II as a spinoff? Maybe...
BUT: a few years ago, I funded a bug named David Hyland, who later moved from U. Michigan to Texas A&M, who was actually the guy who first sold JPL on "constellation imaging" technology,
after we had some discussion of earth observing platforms at an AF meeting he led in 1997.
(A very, very memorable meeting for me, in many ways.) That was only Phase I of a
more ambitious more cost-effective constellation observing technology he developed,
"Quantum Twiss interferometry.' That was proved out in hardware studies under NASA's TPF program... but then came Shelby, and it's interesting whether it's dead, black or European right now. Could be any of the three. It would be a huge opportunity for this group... and would enhance the spinoffs to an incredible degree.
And, yes, a lot of this traces back not only to stuff I funded, but algorithms I developed
even before that...
I hope they succeed, but that earth-to-LEO cost is ever more a crisis for ANYTHING in space...
For more details on the group, see
www.PlanetaryResources.com,
which contains a link to the video of the press conference:
http://www.youtube.com/watch?v=t0c9oZh4vTo&fs=1&rel=0&autoplay=1
First, it's mainly a robotics effort. They have a small team, but it's clear that the team posted on the web is less than half the full team. Moseley and other JPL people
clearly play a critical role. In listing key enabling technologies on the **IT** side,
crucial to success in these robotics... they basically referred to telescopes and
planetary rovers form JPL, but ALSO "medical devices and automotive." What does JPL do in automotive technology related to these goals? I can guess. For some kind of robotic control, the best chip available for many years was the chip developed by Mosaix, a spinoff or partner of JPL. Their initial contract with Ford was very widely publicized by JPL. But they developed a more powerful Phase II chip, under funding from me.
However, there is new stuff in the pipeline of the same family which will be far more powerful. I have a couple of chapters in press in the new books on memristors...
Robotic mining: in fact this was a major theme in JIETSSP, the funding initiative on space solar power which I led in 2002. (The last US government funding effort on energy from space.) The best really working technology for that did not come from JPL... It involved "teleautonomy." A key challenge was to
develop robotics skills... and that's basically a task for ADP, an area I have been pushing very hard to advance from NSF. But it has been a great struggle, given the resistance of old fashioned binary thinkers... still, the new book edited by Lewis and Liu, from IEEE Press, gives the best present state of the art. NASA Ames was a great center for this stuff, but Shelby's Apollo on steroids preserved jobs in Decatur by firing a lot of the key folks in California... (with no resistance at all by Boeing lobbyists)... weakening US technology in this area, but maybe freeing up some people for this venture.
The venture depends VERY heavily on hitching rides to get to earth orbit in the first place.
The ultimate costs will still be pretty much proportional to cost of getting from earth to LEO,
which this venture will do nothing to reduce. There is potential to reduce those costs a hundred fold. It would
be really great if they could join the meager efforts to make that happen... but the plan right now says nothing about that. These guys are quite competent, but none of today's launch service
efforts are within a factor of ten of what could be done for cost reduction in that area. My
new paper which just came out in Russian, invited by a Russian aerospace journal... gets somewhat into the real story, which is a long one.
Since Moseley was a telescope guy... no surprise that the first two phases, Arkyd (sp?) 100 and 200,
involve building space telescopes in Bellevue, Washington, and getting them into orbit. They plan six years of that. That's the real hardware, the real investment, for the next 5-6 years.
To "prospect." But they have dual use, and parallel cash streams are used to stay in the black.
Does this mean we get Google Earth II as a spinoff? Maybe...
BUT: a few years ago, I funded a bug named David Hyland, who later moved from U. Michigan to Texas A&M, who was actually the guy who first sold JPL on "constellation imaging" technology,
after we had some discussion of earth observing platforms at an AF meeting he led in 1997.
(A very, very memorable meeting for me, in many ways.) That was only Phase I of a
more ambitious more cost-effective constellation observing technology he developed,
"Quantum Twiss interferometry.' That was proved out in hardware studies under NASA's TPF program... but then came Shelby, and it's interesting whether it's dead, black or European right now. Could be any of the three. It would be a huge opportunity for this group... and would enhance the spinoffs to an incredible degree.
And, yes, a lot of this traces back not only to stuff I funded, but algorithms I developed
even before that...
I hope they succeed, but that earth-to-LEO cost is ever more a crisis for ANYTHING in space...
For more details on the group, see
www.PlanetaryResources.com,
which contains a link to the video of the press conference:
http://www.youtube.com/watch?v=t0c9oZh4vTo&fs=1&rel=0&autoplay=1
Sunday, April 22, 2012
Big dark matter study might even allow FTL travel
Moni-Bidin
http://www.livescience.com/19796-dark-matter-alternatives.html
Real science pays real attention to empirical reality, and stands ready to turn on a dime
when important new information comes in. And it always remembers that learning from
experience and experiment... is a kind of game of probabilities, which those of us
who know about learning never forget.
About three days ago, I was very open-minded in principle about whether
Einstein's general theory of relativity (GR) is the ultimate truth. But in practice,
I didn't see any reason to doubt it, or to doubt the conclusion that realistic human
travel beyond the speed of light would be essentially impossible. OK, there are
wormhole solutions to GR, but I gather that these tend to be unstable and ask for
use of a kind of matter ("exotic matter" with negative mass) that we have absolutely no
idea of how to produce, whose very existence is hypothetical and a problem for all
present physical theories. For the "next big revolution" in physics, I saw
changes in all parts of physics EXCEPT GR.
But now... a major new empirical result has come in (see above).
On a HUGE scale, we have known for a decade or two that the great motions of galaxies
are grossly out of line with what would be predicted from GR, based on the mass of
what we see out there. But the hypothesis of "dark matter" seemed to solve all that.
This is where the psychology of modern science gets to be quite interesting... and
predictably pathological. We had two choices out there -- to assume a huge amount
of a new kind of matter, totally different from anything in our experience
or in today's standard model of physics electroweak theory plus quantum chromodynamics,
the twin pillars of most of physics today), or to change GR. To change
the standard model, or to change GR. Apriori, I can't see why we should have so much
confidence that the standard model is the one that has to change, and that GR is the
one which has to say the same. We don 't really know yet. The weird thing is that
the reactive political establishment of physics is usually very upset when I suggest tinkering with the tiniest detail of the standard model, to make it more consistent with GR. Usually I am "on the GR side." But the sheer mental inertia takes over...
when they have played with dark matter for all of a decade or two, it becomes instant nonquestionable dogma to many!
I am in the minority who really believes we DO have compelling reasons to question the standard model of physics as it stands today, at its core, and has provided an alternative. But in the new controversy... dark matter versus changing GR..
I am utterly agnostic and vastly entertained.
It intrigues me that MSNBC and LiveScience, in reporting the study, ASKED
the obvious question: "Ok, if we can take this experimental result at face value
even though we have a lot of checking to do), what does that tell us?"
Suddenly there is a significant possibility (30-60% probability, like) that
replacing GR with a new theory by Moffat, a theory called MOG (Modified Gravity),
is a "next big step up" for physics, much closer to reality than GR.
We shouldn't suddenly treat that as a new dogma... but we have every reason to take it seriously.
Also, all of a sudden, all those analyses of how hard it would be to do FTL travel...
may be based on the wrong theory. In MOG, the speed of light is a variable.
The basics of MOG are available on wikipedia.
http://en.wikipedia.org/wiki/Scalar-tensor-vector_gravity
People have not yet studied MOG so much as they have studied MOG, so we do not yet know. There are many interesting questions here --
1. What ARE the FTL implications if MOG happens to be true?
2. Are there problems with stability and well-definedness with MOG which may justify
some technical changes in the theory -- or which introduce novel stochastic factors?
3. Does his phi field really have exactly the form given? Does it require modifications such as those I argue we need for the "Higgs field" in electroweak theory? Or does it also couple with neutrinos or such? (Phi itself could be considered
a KIND of dark matter, a very different kind from what reactive thinkers have assumed.)
And, of course, there are the questions of whether the new experimental result will
hold up when new surveys of stars or galaxies are done. (Yet it is still possible that the dark matter hypothesis is consistent with data on one scale but not another; it would be a typical mental aberration for folks to assume that consistency on one scale "shows that the earlier result" (about another scale) "is wrong." Also, as Moni-Bidin has noted, "we might find that the dark matter is there, but is simply shaped like a giant cigar in space... though I can't quite imagine why that would be as yet."
UNLIKE MOffat's theory, these cigar alternatives are not so well motivated right
now... but we will see.
Some critics have said: "that's well and good, but where are the phions?"
Well, in my version of QFT we shouldn't expect to see phions UNLESS a specific
decay mechanism has been predicted and looked for; perhaps I need to do more google search to see whether that is the case, but I am not aware of it right now.
It would be really nice if people could remember that old idea about exploring the unknown and paying enough respect to empirical reality... not only from Solyndra..
=====
By the way -- I mentioned wormholes here mainly because most people know about them,
and I always seem to be at risk from giving more details than people feel comfortable with. But in truth -- I was really thinking of the "Alcubierre solution" in GR,
which also requires "exotic matter." Would that kind of faster than light moving solution be possible in MOG, without negative mass matter? I don't know. It would
be interesting to find out.
Not that we should rule out the possibility of someday discovering negative mass
matter. That doesn't seem to fit very well either in today's physics or even 'the next generation," but ... m,aybe when we know more, we will be better prepared to do more justice to the possibility. Maybe.
But we have big steps to make first -- in the formulation of quantum theory,
in the realms of the standard model, and perhaps, it seems, even in the realm of gravity.
http://www.livescience.com/19796-dark-matter-alternatives.html
Real science pays real attention to empirical reality, and stands ready to turn on a dime
when important new information comes in. And it always remembers that learning from
experience and experiment... is a kind of game of probabilities, which those of us
who know about learning never forget.
About three days ago, I was very open-minded in principle about whether
Einstein's general theory of relativity (GR) is the ultimate truth. But in practice,
I didn't see any reason to doubt it, or to doubt the conclusion that realistic human
travel beyond the speed of light would be essentially impossible. OK, there are
wormhole solutions to GR, but I gather that these tend to be unstable and ask for
use of a kind of matter ("exotic matter" with negative mass) that we have absolutely no
idea of how to produce, whose very existence is hypothetical and a problem for all
present physical theories. For the "next big revolution" in physics, I saw
changes in all parts of physics EXCEPT GR.
But now... a major new empirical result has come in (see above).
On a HUGE scale, we have known for a decade or two that the great motions of galaxies
are grossly out of line with what would be predicted from GR, based on the mass of
what we see out there. But the hypothesis of "dark matter" seemed to solve all that.
This is where the psychology of modern science gets to be quite interesting... and
predictably pathological. We had two choices out there -- to assume a huge amount
of a new kind of matter, totally different from anything in our experience
or in today's standard model of physics electroweak theory plus quantum chromodynamics,
the twin pillars of most of physics today), or to change GR. To change
the standard model, or to change GR. Apriori, I can't see why we should have so much
confidence that the standard model is the one that has to change, and that GR is the
one which has to say the same. We don 't really know yet. The weird thing is that
the reactive political establishment of physics is usually very upset when I suggest tinkering with the tiniest detail of the standard model, to make it more consistent with GR. Usually I am "on the GR side." But the sheer mental inertia takes over...
when they have played with dark matter for all of a decade or two, it becomes instant nonquestionable dogma to many!
I am in the minority who really believes we DO have compelling reasons to question the standard model of physics as it stands today, at its core, and has provided an alternative. But in the new controversy... dark matter versus changing GR..
I am utterly agnostic and vastly entertained.
It intrigues me that MSNBC and LiveScience, in reporting the study, ASKED
the obvious question: "Ok, if we can take this experimental result at face value
even though we have a lot of checking to do), what does that tell us?"
Suddenly there is a significant possibility (30-60% probability, like) that
replacing GR with a new theory by Moffat, a theory called MOG (Modified Gravity),
is a "next big step up" for physics, much closer to reality than GR.
We shouldn't suddenly treat that as a new dogma... but we have every reason to take it seriously.
Also, all of a sudden, all those analyses of how hard it would be to do FTL travel...
may be based on the wrong theory. In MOG, the speed of light is a variable.
The basics of MOG are available on wikipedia.
http://en.wikipedia.org/wiki/Scalar-tensor-vector_gravity
People have not yet studied MOG so much as they have studied MOG, so we do not yet know. There are many interesting questions here --
1. What ARE the FTL implications if MOG happens to be true?
2. Are there problems with stability and well-definedness with MOG which may justify
some technical changes in the theory -- or which introduce novel stochastic factors?
3. Does his phi field really have exactly the form given? Does it require modifications such as those I argue we need for the "Higgs field" in electroweak theory? Or does it also couple with neutrinos or such? (Phi itself could be considered
a KIND of dark matter, a very different kind from what reactive thinkers have assumed.)
And, of course, there are the questions of whether the new experimental result will
hold up when new surveys of stars or galaxies are done. (Yet it is still possible that the dark matter hypothesis is consistent with data on one scale but not another; it would be a typical mental aberration for folks to assume that consistency on one scale "shows that the earlier result" (about another scale) "is wrong." Also, as Moni-Bidin has noted, "we might find that the dark matter is there, but is simply shaped like a giant cigar in space... though I can't quite imagine why that would be as yet."
UNLIKE MOffat's theory, these cigar alternatives are not so well motivated right
now... but we will see.
Some critics have said: "that's well and good, but where are the phions?"
Well, in my version of QFT we shouldn't expect to see phions UNLESS a specific
decay mechanism has been predicted and looked for; perhaps I need to do more google search to see whether that is the case, but I am not aware of it right now.
It would be really nice if people could remember that old idea about exploring the unknown and paying enough respect to empirical reality... not only from Solyndra..
=====
By the way -- I mentioned wormholes here mainly because most people know about them,
and I always seem to be at risk from giving more details than people feel comfortable with. But in truth -- I was really thinking of the "Alcubierre solution" in GR,
which also requires "exotic matter." Would that kind of faster than light moving solution be possible in MOG, without negative mass matter? I don't know. It would
be interesting to find out.
Not that we should rule out the possibility of someday discovering negative mass
matter. That doesn't seem to fit very well either in today's physics or even 'the next generation," but ... m,aybe when we know more, we will be better prepared to do more justice to the possibility. Maybe.
But we have big steps to make first -- in the formulation of quantum theory,
in the realms of the standard model, and perhaps, it seems, even in the realm of gravity.
Saturday, April 14, 2012
Defusing the ticking time bomb in the EU Economy
A few days ago, the Financial Times carried an op-ed by Gideon Rachman on
"the ticking time bomb that no one can defuse." I sent him an email (first item below)
on what the real time bomb is -- not the banks, not the euro, but the risk of a new Great Depression. In other words, jobs and aggregate demand. And I argued that
we CAN defuse it... if we use our brains a bit more effectively and really focus on the problem.
A few days after that, there was another op-ed by Soros which actually did seem
to be aware of the real time bomb... TO SOME DEGREE. A good start, but we need a lot more. So my comments on that, somewhat technical come next. And then a few thoughts
about a friend's discussion with Larry Summers..
=====================
=====================
---------- Forwarded message ----------
From: Paul Werbos
Date: Fri, Apr 6, 2012 at 2:56 PM
Subject: any way to defuse the time bomb about to blow up in your face
To: gideon.rachman@ft.com
Dear Mr. Rachman:
Thank you very much for your stimulating op-ed on the ticking time
bomb in the economy of Europe.
What scares me most here is that the biggest time bomb is not about
the euro or about the banks
(important as they are) but about aggregate demand. My worry is that
aggregate demand will keep slipping in Europe,
with or without the euro, and that a combination of decay in Europe
and naive policies coming into the US
might bring us to something a bit like reliving the thirties.. if
indeed we would actually through a repetition of
that level of stress. The recent suicide in Greece, and the problems
in Italy and Spain and even France,
should be deeply worrisome to anyone open to reality.
Is there any way to defuse that ticking time bomb? Perhaps that is the
number one question many of us should be thinking very very hard and
very creatively about.
A few months ago, I thought about this question in very concrete
terms. If we need more aggregate demand in southern Europe,
but the Germans worry they would lose if they sent more money to the
government of Greece ("down the toilet"), what is the resolution of
the impasse? Concretely -- if Greeks (and Italians and Spaniards) need
more jobs, what can German money buy from them that
gives jobs but is a worthwhile investment for Germany? It seemed
obvious electricity. More precisely,
Germans are preparing to pay 20 cents per kwh for huge volumes of
offshore wind, when the lowest cost versions of solar thermal solar
power (dish Stirling) would offer electricity at only 13 cents per
kwh, in a far more reliable and useful time frame. Why not an
immediate pan-European investment (some kind of private-public
partnership) to inject huge amounts of money into building such solar
farms in areas of reliable sun in Greece, Italy and Spain? A great way
to reduce the risk of depression and create jobs, while
making a real profit, reducing dependence on Russian natural gas, and
doing something good for the environment, all at the same time. A real
Pareto optimum.
But -- I am reminded that this would require someone actually honest
and competent enough to lead the investment.
I remember the old saying: "If you think you have invented the perfect
form of government, imagine how it would be implemented if all the
positions were staffed by chimpanzees." Elevated titles and such
certainly do not guarantee competence in this kind of venture,
especially when vested interests are involved. And after all, why
don't the European banks do this all unilaterally anyway,
if there were not a problem of sheer technical competence here?
So here is a second possibility, perhaps a bit more realistic.
You know that the US has some of the same underlying problem as the EU
(except for the personal skills of President Obama,
which are far from infinite but are also notably a help here). You
know that government debt levels are also similar in China, if
provincial governments are included.
So why not a kind of aim for a strange kind of new ultra-G-$ meeting
(US, EU (Merkel?), China (Xi), Brazil) aimed
at some kind of monetary cease-fire, so we can all have low interests
rates to pay off debt?
And why not include in that agreement a big new infusion through IMF
to the World Bank, to a major effort NOT limited
to developing nations, to a kind of competitive financing (with even
competing funds in the Bank) to
develop minimum cost renewable energy, alternate liquid fuels and the
like, to the market?
The skills of the World Bank are not unlimited, any more than those of
the ECB (or of the folks who made the Solyndra loan in the US), but if
funds were restricted to certain class of investment, we wouldn't have
quite the same liquidity trap
which limits the aggregate demand benefit from today's monetary
easings. As I think of this, I see some analogies to funding issues of
NSF (where I work), of ARPA-E, and of mainline DOE and DARPA. Neither
they nor the European banks are infallible, but a '
proper structuring of risk, uncertainty, commitment to fund, and
diversity of channels ought to be able to do as well as
anything else humanity can do. And it would be a lot better than
falling into total paralysis and depression.
A competition with a focus, a commitment to act, and some diversity
should really do quite well.
Anyway, that's the best I can think of right now to try to defuse the
bomb. If we don't find someone to do SOMETHING,
it's your face and mine (along with a few million others) which may
get blown off, regardless of whatever else we do.
Of course, if you can think of any way at all to increase the
probability of defusing the time bomb, I would want to help.
Best of luck,
Paul
Dr. Paul J. Werbos
Not representing official views of NSF, IEEE, www.stateofthefuture.org, etc.
===================================================
===================================================
Soros' op-ed certainly describes other important aspects of this situation.
In a way, I's day my letter is like one eye, and his is like another;
one must see through two eyes to get
a correct three-dimensional picture.
There are certain technical details I left out of the letter to
Rachman. (I am usually leaving
out some technical details, because there are always so many of them.)
For example, when I wrote to Rachman, I was influenced by a message I
heard clearly a few days before from GE's
director of strategic policy, where he talked about the way funds have
dried up recently for many new energy projects.
"Appetite for risk" were the words he used. And Soros makes related
points. Part of our "liquidity crisis" is
actually a matter of fear. In a way, the threat of depression is
caused by a kind of prisoner's dilemma effect,
which strengthens a reflexive phenomenon. Of course, Soros is quite
familiar with the basic idea
and importance of reflexive phenomena, but this case is very special
in ways which go beyond
some of the examples he has seen before. I think of it in part as a
simple matter of the existence of multiple solutions
in the rational expectations model, where the choice of solution is
based on psychology. Actions to change the psychology,
for example by deciding we WILL invest X dollars in certain areas, can
make a crucial difference.
I also think of it as matter of how one organizes and allocates risk,
a topic which today's dynamic stochastic general equilibrium theory
does not yet do full justice to, because of the lack of consensus
about risk expectations. (NOT that we would
want to enforce such consensus!!)
=========================
A friend asked Summers: Do you know anyone is awake about
the risk of depression -- job loss and aggregate demand -- in the EU,
and about ways that energy investment could reduce the risk?
Summers was CERTAINLY aware of that risk in the US. But he said -- energy
is too small to make a difference.
=======
Added April 16: this morning, the Financial Times has an op-ed by Wolfgang Munchau which also clearly states that the real concern even among investors is about
the level of the overall economy (aggregate demand) much more than about the narrower issues of euro and bank solvency. I would be tempted to quote a sentence or two... but I think that FT prefers that people go to their web page for their material.
Even the best economics at "300,000 feet" often loses touch with reality.
If electricity is about 10 cents per kwh, OECD data show 20,000 terawatt hours per year... $2 trillion per year. And yearly US oil imports have been bouncing around another half trillion per year, with lots of risk of going much higher.
Those kinds of numbers really are enough to matter, especially if we start building up
new capital which generates flows at that kind of level.
Best of luck,
Paul
"the ticking time bomb that no one can defuse." I sent him an email (first item below)
on what the real time bomb is -- not the banks, not the euro, but the risk of a new Great Depression. In other words, jobs and aggregate demand. And I argued that
we CAN defuse it... if we use our brains a bit more effectively and really focus on the problem.
A few days after that, there was another op-ed by Soros which actually did seem
to be aware of the real time bomb... TO SOME DEGREE. A good start, but we need a lot more. So my comments on that, somewhat technical come next. And then a few thoughts
about a friend's discussion with Larry Summers..
=====================
=====================
---------- Forwarded message ----------
From: Paul Werbos
Date: Fri, Apr 6, 2012 at 2:56 PM
Subject: any way to defuse the time bomb about to blow up in your face
To: gideon.rachman@ft.com
Dear Mr. Rachman:
Thank you very much for your stimulating op-ed on the ticking time
bomb in the economy of Europe.
What scares me most here is that the biggest time bomb is not about
the euro or about the banks
(important as they are) but about aggregate demand. My worry is that
aggregate demand will keep slipping in Europe,
with or without the euro, and that a combination of decay in Europe
and naive policies coming into the US
might bring us to something a bit like reliving the thirties.. if
indeed we would actually through a repetition of
that level of stress. The recent suicide in Greece, and the problems
in Italy and Spain and even France,
should be deeply worrisome to anyone open to reality.
Is there any way to defuse that ticking time bomb? Perhaps that is the
number one question many of us should be thinking very very hard and
very creatively about.
A few months ago, I thought about this question in very concrete
terms. If we need more aggregate demand in southern Europe,
but the Germans worry they would lose if they sent more money to the
government of Greece ("down the toilet"), what is the resolution of
the impasse? Concretely -- if Greeks (and Italians and Spaniards) need
more jobs, what can German money buy from them that
gives jobs but is a worthwhile investment for Germany? It seemed
obvious electricity. More precisely,
Germans are preparing to pay 20 cents per kwh for huge volumes of
offshore wind, when the lowest cost versions of solar thermal solar
power (dish Stirling) would offer electricity at only 13 cents per
kwh, in a far more reliable and useful time frame. Why not an
immediate pan-European investment (some kind of private-public
partnership) to inject huge amounts of money into building such solar
farms in areas of reliable sun in Greece, Italy and Spain? A great way
to reduce the risk of depression and create jobs, while
making a real profit, reducing dependence on Russian natural gas, and
doing something good for the environment, all at the same time. A real
Pareto optimum.
But -- I am reminded that this would require someone actually honest
and competent enough to lead the investment.
I remember the old saying: "If you think you have invented the perfect
form of government, imagine how it would be implemented if all the
positions were staffed by chimpanzees." Elevated titles and such
certainly do not guarantee competence in this kind of venture,
especially when vested interests are involved. And after all, why
don't the European banks do this all unilaterally anyway,
if there were not a problem of sheer technical competence here?
So here is a second possibility, perhaps a bit more realistic.
You know that the US has some of the same underlying problem as the EU
(except for the personal skills of President Obama,
which are far from infinite but are also notably a help here). You
know that government debt levels are also similar in China, if
provincial governments are included.
So why not a kind of aim for a strange kind of new ultra-G-$ meeting
(US, EU (Merkel?), China (Xi), Brazil) aimed
at some kind of monetary cease-fire, so we can all have low interests
rates to pay off debt?
And why not include in that agreement a big new infusion through IMF
to the World Bank, to a major effort NOT limited
to developing nations, to a kind of competitive financing (with even
competing funds in the Bank) to
develop minimum cost renewable energy, alternate liquid fuels and the
like, to the market?
The skills of the World Bank are not unlimited, any more than those of
the ECB (or of the folks who made the Solyndra loan in the US), but if
funds were restricted to certain class of investment, we wouldn't have
quite the same liquidity trap
which limits the aggregate demand benefit from today's monetary
easings. As I think of this, I see some analogies to funding issues of
NSF (where I work), of ARPA-E, and of mainline DOE and DARPA. Neither
they nor the European banks are infallible, but a '
proper structuring of risk, uncertainty, commitment to fund, and
diversity of channels ought to be able to do as well as
anything else humanity can do. And it would be a lot better than
falling into total paralysis and depression.
A competition with a focus, a commitment to act, and some diversity
should really do quite well.
Anyway, that's the best I can think of right now to try to defuse the
bomb. If we don't find someone to do SOMETHING,
it's your face and mine (along with a few million others) which may
get blown off, regardless of whatever else we do.
Of course, if you can think of any way at all to increase the
probability of defusing the time bomb, I would want to help.
Best of luck,
Paul
Dr. Paul J. Werbos
Not representing official views of NSF, IEEE, www.stateofthefuture.org, etc.
===================================================
===================================================
Soros' op-ed certainly describes other important aspects of this situation.
In a way, I's day my letter is like one eye, and his is like another;
one must see through two eyes to get
a correct three-dimensional picture.
There are certain technical details I left out of the letter to
Rachman. (I am usually leaving
out some technical details, because there are always so many of them.)
For example, when I wrote to Rachman, I was influenced by a message I
heard clearly a few days before from GE's
director of strategic policy, where he talked about the way funds have
dried up recently for many new energy projects.
"Appetite for risk" were the words he used. And Soros makes related
points. Part of our "liquidity crisis" is
actually a matter of fear. In a way, the threat of depression is
caused by a kind of prisoner's dilemma effect,
which strengthens a reflexive phenomenon. Of course, Soros is quite
familiar with the basic idea
and importance of reflexive phenomena, but this case is very special
in ways which go beyond
some of the examples he has seen before. I think of it in part as a
simple matter of the existence of multiple solutions
in the rational expectations model, where the choice of solution is
based on psychology. Actions to change the psychology,
for example by deciding we WILL invest X dollars in certain areas, can
make a crucial difference.
I also think of it as matter of how one organizes and allocates risk,
a topic which today's dynamic stochastic general equilibrium theory
does not yet do full justice to, because of the lack of consensus
about risk expectations. (NOT that we would
want to enforce such consensus!!)
=========================
A friend asked Summers: Do you know anyone is awake about
the risk of depression -- job loss and aggregate demand -- in the EU,
and about ways that energy investment could reduce the risk?
Summers was CERTAINLY aware of that risk in the US. But he said -- energy
is too small to make a difference.
=======
Added April 16: this morning, the Financial Times has an op-ed by Wolfgang Munchau which also clearly states that the real concern even among investors is about
the level of the overall economy (aggregate demand) much more than about the narrower issues of euro and bank solvency. I would be tempted to quote a sentence or two... but I think that FT prefers that people go to their web page for their material.
Even the best economics at "300,000 feet" often loses touch with reality.
If electricity is about 10 cents per kwh, OECD data show 20,000 terawatt hours per year... $2 trillion per year. And yearly US oil imports have been bouncing around another half trillion per year, with lots of risk of going much higher.
Those kinds of numbers really are enough to matter, especially if we start building up
new capital which generates flows at that kind of level.
Best of luck,
Paul
Thursday, April 5, 2012
A children's view of our elections: Dr. Seuss or what?
Imagine a class of children talking...
A boy said: "I am so glad we are done with that primary stage. All those nasty old roadrunner cartoons, with the newt sunning himself on a rock and looking down on the other guys... now we get to something much nicer, like Dr. Seuss."
"Yes," said a girl,"We get to choose between the cat in the hat and the grinch."
"Hey," said the boy,"He's not a REAL cat in the hat. He only thinks he's the cat in the hat. He hasn't cleaned up his mess yet, and there are all those broken plates from when he tried to do some tricks that were a little too hard."
"On no," said the girl,"At least he's TRYING to be a good cat in the hat, and that's
better than being an old grinch. Besides, after the elections, he may have thing1 and thing2 to help him, and then the messes will get cleaned up."
"Hmm," said the boy. "I don't really believe in Dr. Seuss. I believe in Alice in Wonderland. That's the world we're really living in..."
"Oh yeah?," said another boy. "Which one is the mad hatter?"
"Well," said a girl, "We still have that sanctimonious rabbit running around.
But either one of the real candidates could be the mad hatter."
"No," said another boy,"Obama has to be the mad hatter, because Romney is the black queen. Nothing else fits so well. Whose coronation is that bunny racing to attend, after all?"
"I disagree," said a kind sweet Mormon girl. "I still like Dr. Seuss.
But you should remember that the grinch turned out to be the very best,
after he had a nice little girl to talk to him. Maybe that's all he needs...
and he was so nice to his wife when she was sick, unlike that terrible tin woodman from those Wizard of Oz primaries last time.."
And then a voice rolled in from the side, the voice of Romney,"That's right. I can be what you want, whatever it is. Any trick that cat can do, I can do too.
I can be a cat. I can be a friendly grinch. I can be R2D2, see... I can mold myself to anything you like.."
"Oh, no," said another girl," You're not REALLY plasticman. And we don't want plasticman anyway. I think you are PINNOCHIO. And you've been talking to too many foxes lately, who pull your strings... let's have a look at your nose...."
And then story time ended. For one day. Many very different stories to come.
====================
Next day: They say:"Almost, not quite. Isn't Newt Gingrich still there? Doesn't
he make a better mad hatter? Obama is more like the Cheshire Cat. And maybe Ryan
will audition for tweedeldum?" Well... maybe different tomorrow..."
A boy said: "I am so glad we are done with that primary stage. All those nasty old roadrunner cartoons, with the newt sunning himself on a rock and looking down on the other guys... now we get to something much nicer, like Dr. Seuss."
"Yes," said a girl,"We get to choose between the cat in the hat and the grinch."
"Hey," said the boy,"He's not a REAL cat in the hat. He only thinks he's the cat in the hat. He hasn't cleaned up his mess yet, and there are all those broken plates from when he tried to do some tricks that were a little too hard."
"On no," said the girl,"At least he's TRYING to be a good cat in the hat, and that's
better than being an old grinch. Besides, after the elections, he may have thing1 and thing2 to help him, and then the messes will get cleaned up."
"Hmm," said the boy. "I don't really believe in Dr. Seuss. I believe in Alice in Wonderland. That's the world we're really living in..."
"Oh yeah?," said another boy. "Which one is the mad hatter?"
"Well," said a girl, "We still have that sanctimonious rabbit running around.
But either one of the real candidates could be the mad hatter."
"No," said another boy,"Obama has to be the mad hatter, because Romney is the black queen. Nothing else fits so well. Whose coronation is that bunny racing to attend, after all?"
"I disagree," said a kind sweet Mormon girl. "I still like Dr. Seuss.
But you should remember that the grinch turned out to be the very best,
after he had a nice little girl to talk to him. Maybe that's all he needs...
and he was so nice to his wife when she was sick, unlike that terrible tin woodman from those Wizard of Oz primaries last time.."
And then a voice rolled in from the side, the voice of Romney,"That's right. I can be what you want, whatever it is. Any trick that cat can do, I can do too.
I can be a cat. I can be a friendly grinch. I can be R2D2, see... I can mold myself to anything you like.."
"Oh, no," said another girl," You're not REALLY plasticman. And we don't want plasticman anyway. I think you are PINNOCHIO. And you've been talking to too many foxes lately, who pull your strings... let's have a look at your nose...."
And then story time ended. For one day. Many very different stories to come.
====================
Next day: They say:"Almost, not quite. Isn't Newt Gingrich still there? Doesn't
he make a better mad hatter? Obama is more like the Cheshire Cat. And maybe Ryan
will audition for tweedeldum?" Well... maybe different tomorrow..."
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