Fractals of Change

Mary Meets Steve Jobs

February, 1984:  Big Brother is not in power but Apple’s famous Big Brother ad did run during the SuperBowl.  Also their less famous ad in which an endless stream of pin-striped lemmings with attache cases march off a cliff.  Clearly these were the MIS managers who believed “no one ever lost his job because he chose IBM.” Now the Macintosh is due to be introduced at SoftCon in New Orleans. Dow Jones hired our company, Solutions, to develop a Mac product to show in their booth to keep a promise which Dow Jones Executive VP Bill Dunn had made to Steve Jobs.

 

Our software is done.  Well, not exactly done but we have a really sexy rolling demo with pull down menus to get more information about the product.  What I’ve done is make a slideshow out of all pictures in the scrapbook (the one piece of Macintosh software I’ve really mastered) and a text crawler from text in the scrapbook.  We can change the slideshow by having graphic artist Patty draw a new picture and cut and paste it into the scrapbook.  Cool!

 

Mary and I tape a handle to the Macintosh carton and fight to carry the box on board planes as we head for New Orleans.  We know that Dow Jones has another early Mac for the booth but, in these days, no two Macs have the same ROM so we weren’t all convinced our software will run on it.

 

The beginning of a show is always magic for us.  The day before the show floor is scratched concrete crisscrossed by forklifts delivering crates of what will become booths.  Small companies like Solutions try to evade the union enforcers who want either to put up your booth or tear it down.  But we’re with Dow Jones this time so we’re not putting up the booth ourselves.  Sometime overnight after the booths have been erected into small and large fantasias and bazaars, rugs cover the concrete; the air conditioners blow out the sweat and singed wire smell; the excited kids who’ve put it all together party away what’s left of the night,  shower, and emerge radiant from their sweaty t-shirt chrysalises in their booth uniforms.  At 10AM the doors open.  Show time!

 

We spell each other at the Dow Jones booth where our Mac and its rolling demo get some but not a lot of attention.  Actually, the Mac itself gets most of the attention here at its debut industry show.  Mary and I spell each other so we can prowl the show floor. Apple has a one story high replica of a Mac.  Its screen shows rolling demo of the software that comes with the Mac – MacWrite and MacPaint – some videos, and some blurbs for vapor products.  Inside it is a real Mac powering the display.

 

Mary never stops marketing.  She takes a diskette with our rolling demo on it, grabs the first person she can find in the Apple booth, and says we want to display it on their big Mac.  “I can’t approve that,” she’s told.

 

“Who can?”

 

The person disappears into the inner recesses of the Apple booth, reemerges, and leads Mary back to a young man with sandy hair, very thick glasses, and a French accent.  He takes her diskette skeptically and puts in a nearby Mac.  He watches the rolling demo, checks the functionality of the menus, admires the graphics.  “How long did this take to do?” he asks.

 

“About five weeks,” says Mary.  She doesn’t add that these were twenty-four hour days.  “Of course, my husband had to learn the Macintosh first.”

 

A tear, according to Mary, rolls out from under the thick glasses.  “It’s going to work,” Alain Rossman says.  “It’s going to work!”  Alain was the third of the fabled Macintosh evangelists, the team Guy Kawasaki made famous in marketing annals.  The success of the Macintosh could not have happened if they hadn’t convinced a skeptical developer community that this was the place to be.  Alain later went on to be a founder of Radius, C-Cube, and Phone.com.  His job previous to Apple, he says, was as a paper boy.

 

Now we’re back in the Dow Jones booth.  There’s a kid in jeans and a flannel shirt who keeps coming over and playing with “our” Mac.  Sometimes he smiles, more often he clucks in disapproval of something or other.  No, he doesn’t want Mary to tell him anything about Dow Jones products.  No, she can’t help him with anything else.  But no one else can get near the Mac while he is there pointing and clicking and pulling down menus.

 

Finally Mary says: “I’m sorry.  This is the Dow Jones booth.  It’s rather formal.  We do have to give other people a chance to look at the product.  Are you sure there’s not something I can help you with?”  Without a word or a smile, the unkempt young man leaves.

 

I met Steve Jobs a few times after that during his first stint at Apple.  Neither of us ever mentioned the time Mary threw him out of the Dow Jones booth.

 

In a previous post, Bill Dunn from Dow Jones forcibly explains that why the Mac is going to change publishing.

 

In the another post we learn what it means to develop for a graphical machine.

 

There is more about the early Macintosh days in my post about Glue.

 

 

Later we licensed our scrapbook capability for inclusion with Mac PowerPoint and Mary published our product SmartScrap & The Clipper which was made mainly out of recycled code from the rolling demo.  Above is the MacUser Editors’ Choice Award (the Eddy) for Best New Desk Accessory which Solutions won.

 

Irene Lesson # 1 – Smart Grid Great for Power Restoration

At 1:36PM yesterday the lights went out for 1103 members of Vermont Electric Coop (VEC) in South Hero, including us at our summer place on the Lake. No surprise; tropical storm Irene was raging up Vermont. No need to call VEC in a panic, though; I could see immediately from their website that they knew about the outage including the exact number of customers affected. VEC was the first utility in Vermont to install smart meters and they know immediately when a meter goes silent. Unlike other utilities who haven't installed smart meters yet, VEC doesn't have to wait for customers to call in. Equally important, they can tell from their monitoring system almost exactly where the break is BEFORE the trucks roll so the linepeople can go straight to the problem rather than having to search along the road or through the woods.

At 8:15PM with the wind still raging, the lights came back on for most of us. It's likely some intrepid person went up in a cherrypicker in the storm and made a repair (thank you!). Immediately the outage website showed that 199 South Hero customers were still without power; something must have happened downstream from the original break. Without smart meters, the crews probably wouldn't have known about the second break for quite a while since the people who were cut off by it would have just assumed that the original problem hadn't been fixed yet and wouldn't have called in again until they lost patience or saw their neighbors' lights on.

Within two years most Vermonters should have smart meters thanks partly to a $69 million stimulus grant awarded to Vermont utilities. We'll probably be the first state in the nation to have a near 100% smart grid. Outage management is only one of the many benefits of adding electronics to the power grid that we'll see. But yesterday and today outage management is a very large benefit indeed. Kudos to VEC for installing smart meters for better customer service even before they got a grant and helping to show the whole state what the advantages of a smart grid are.

Related posts:

House Flatlines – Smart Grid to the Rescue

What's a Smart Grid and Why Does It Matter?

What The $69 Million Smart Grid Grant Will Mean to Vermont

More Natural Gas or Less?

"Geologists Sharply Cut Estimate of Shale Gas" is the headline of a New York Times story today on a report from the United States Geological Survey (USGS).

"USGS boosts amount of Marcellus Shale gas reserves" was the headline of a Wall Street Journal reprint of an AP story on the same USGS, which ran Tuesday.

Hmmm…. Time to check the original sources.

According to a press release from the USGS which accompanies the report:

"The Marcellus Shale contains about 84 trillion cubic feet of undiscovered, technically recoverable natural gas and 3.4 billion barrels of undiscovered, technically recoverable natural gas liquids according to a new assessment by the U. S. Geological Survey (USGS).

"These gas estimates are significantly more than the last USGS assessment of the Marcellus Shale in the Appalachian Basin in 2002, which estimated a mean of about 2 trillion cubic feet of gas (TCF) and 0.01 billion barrels of natural gas liquids.[hiliting mine]

"The increase in undiscovered, technically recoverable resource is due to new geologic information and engineering data, as technological developments in producing unconventional resources have been significant in the last decade. This Marcellus Shale estimate is of unconventional (or continuous-type) gas resources."

You'd have to agree that 84 trillion is a lot more than two trillion. Note that these two estimates are only nine years apart. The old one wasn't wrong for when it was written; just didn't take fracking into account.

However, the NYT's headline isn't technically wrong, just sloppy in comparing apples to oranges. From the lede of their story:

"Federal geologists published new estimates this week for the amount of natural gas that exists in a giant rock formation known as the Marcellus Shale, which stretches from New York to Virginia.

"The shale formation has about 84 trillion cubic feet of undiscovered, technically recoverable natural gas, according to the report from the United States Geological Survey. This is drastically lower than the 410 trillion cubic feet that was published earlier this year by the federal Energy Information Administration (EIA)." [hiliting mine]

You have to read two-thirds of the way down the NYT story to find that the previous estimate from USGS was two trillion cubic feet. On the other hand, the AP story quoted by the WSJ doesn't mention the disparity between the numbers given by USGS and the EIA. According to the NYT, the EIA plans to revise its number downwards. "They're geologists; we're not. We're going to be taking this number and using it in our model."

So why the difference in editorial bias? And why does it matter?

First things first. The facts about supplies of accessible natural gas matter enormously to energy policy. If we are going to have cheap and abundant natural gas for at least the next few decades, it is very hard to justify huge investments in new nuclear, solar, and wind energy – all of which are much, much more expensive for generating electricity than natural gas at current domestic prices and none of which are directly useful for heating our homes or powering road vehicles. Domestic natural gas directly replaces imported oil from unfriendly places and produces much less CO2 when burned than oil and much, much less than coal. As a bonus NG is very light on other pollutants found in coal and oil smokestacks. Oh yeah, natural gas makes corny ethanol look even dumber than it already looks.

On the other hand, if NG prices are only temporarily low or NG extraction has unacceptable environmental consequences, then promoters of more expensive alternatives – and seekers of subsidies for more expensive alternatives – have a better case to make. The energy competition doesn't like natural gas – especially abundant, cheap, accessible natural gas. It is highly disruptive to their plans.

The New York Times has run a series of articles hostile to natural gas, one of them, by Ian Urbina who also wrote today's article which is quoted above, was so badly done that it drew a rebuke from their own public editor. The NYT editorial policy has been highly in favor of continued subsidies and mandates for "renewable" – i.e. currently uneconomic wind and solar. Their news judgment seems warped by the threat NG poses to any conceivable argument for deploying technologies which are not yet ready for the market place, which drive up the price of electricity, and which don't directly displace oil.

WSJ is against subsidies for ethanol, wind, and solar (not so clear about nuclear). They have IMHO been pretty evenhanded in covering potential problems with NG even though the AP story they ran was not thorough. Today's edition, for example, gives prominence to an SEC investigation of disclosure of risks associated with fracking for natural gas: "SEC Bears Down on Fracking".

It is of huge consequence to national policy to determine how much domestic natural gas can boost our economy, reduce dependence on foreign oil, create jobs not just in extraction but in energy-dependent industries, and lower emissions of many kinds. We need the best reporting we can get. We must all remain skeptical and keep asking ourselves "what vested interest does this story serve?"

Related posts:

Energy for Jobs – Vermont Version

How to Increase Your Electric Bill to $630 per Month

Natural Gas Disrupts the Energy Industry

Why Won’t Americans Take These Jobs?

We've heard the argument a million times:

Farmers: "Americans just won't take these jobs."

Proponents of stricter immigration enforcement: "It's unconscionable to allow these foreigners to take American jobs at a time of high unemployment."

What we don't hear is the question: "how come with such high unemployment Americans aren't taking these jobs?" The answer, in some cases, is that we're paying them not to. Paying people who can work but won't depletes unemployment funds for those who are not voluntarily jobless and forces the cost of unemployment insurance relentlessly upward. Paying welfare to people who choose not to work robs the benefits needed by those who can't work or whose work income can't completely support their families.

Here in Vermont dairy farmers are dependent on migrant workers and are pretty open that most of these are "undocumented" (polite word for illegal). The farmers are convinced and convincing that they can't hire Americans for these jobs even though they pay above minimum wage and the jobs meet all legal employment standards for health and safety. The "undocumented" young men (it's almost all young men) who risk their lives to cross the American border, work hard, and send money back to families at home are admirable IMHO. They are more productive than the citizens who "won't" take these jobs. But why are we paying unemployment insurance and/or welfare or providing food stamps to able-bodied people who aren't tied down by child care but "won't" take these jobs?

There was a brouhaha over whether Vermont's not-very-well-defined future single payer health insurance system will pay benefits to illegal workers. Illegal workers (these, anyway) pay taxes; shouldn't the question be "what work should an able-bodied person be required to do in order to be covered by any form of public assistance?"

There was a recent story in The New York Times about farmer opposition to a bill which would require them to e-verify the citizenship of their workers:

""People just don't want to do farm work," Mr. Wenger [president of the California Farm Bureau] said. "They don't want to pick berries. They don't want to pick lettuce. And the pay is just as good as working at the hamburger shop or making up hotel rooms, but they just don't want to do the work."

"Mike Carlton, director of labor relations for the Florida Fruit and Vegetables Association, agreed. He said his group monitored hiring by citrus growers, who are required to offer jobs to Americans before they can turn to the H-2A program for temporary foreign laborers.

"In one sample, Mr. Carlton said, 344 Americans came forward to fill 1,800 pickers' jobs; only eight were still working at the end of the two-month season."

The story doesn't say whether those who turn down or quit picker's jobs are still eligible for unemployment insurance or what they then live on. Maybe they all got "better" jobs but I doubt it. The story doesn't say whether the documentation for H-2A proving that Americans won't take these jobs is turned over to unemployment offices to check against jobless claims in their area.

It feels mean-spirited to write this at a time when so many Americans are involuntarily unemployed and doing their best to find work. It is certainly true that banks got bailed out that shouldn't have and that hedge-fund managers should pay their fair share of taxes (General Electric, too). It is also true that there are unscrupulous employers who pay less than minimum wage to illegal workers or who subject them to unsafe working conditions. There's no excuse for any of that. But it's perverse to concentrate on sending hard-workers away while paying some Americans not to work. The unemployment rate will go down – not all the way down but down some –when we deny public assistance and "extended" unemployment benefits to those who "won't" take available jobs.

Jobs Rx: Make America Shovel Ready

Twenty years of major construction projects are bottled up in regulatory queues. If the time in queue were shortened to a maximum of two years, we'd have a flood of new construction AND much of the infrastructure we need to be competitive in the globalized years ahead. No subsidies from the deficit-ridden federal government are required. Conversely, tax revenue from those directly or indirectly employed on these projects and the economic value of the projects themselves will increase government revenue and help close the budget gap.

The majority of these projects have private sector funding lined up. American corporations are sitting on piles of money, waiting for a chance to invest it for future profit. In the short term, they're not going to hire more people to make more things until demand picks up. But, planning for the long term, they will invest in infrastructure for their future growth IFF given the opportunity. How do I know? Because all over America there are pipeline, power grid, oil drilling, gas extraction, broadband, wireless, factory-building, shopping center, and even a few nuclear power plants projects queued up waiting almost endlessly – and, what is worse, unpredictably – for the permits they need to proceed and then the long slog through decades of appeals.

State and local governments have transportation projects queued up in the same way. Even with a flood of stimulus money, all we could do was permitless repaving; the big projects are stuck in regulatory hell. Nothing in America is shovel ready. The stimulus dollars allocated to broadband and smart metering are just beginning to be spent; these projects may still forfeit their federal funding because of the time required to get permits. Another stimulus bill – besides being unaffordable – would run into the same roadblocks. But, if projects can be accelerated out of queue, credit-worthy states will be able to build them. More significantly, the huge stash of private dollars waiting for opportunity will come into play.

We don't need another "regulatory review". Ask regulators to review their regulations and they'll write some new ones. We need to set a goal that every project gets to yes or no within two years of initial application and remake the regulatory processes at the federal, state, and local levels to assure that the goal is met. Even a fast no is better than a twenty-year maybe; it frees up moeny for other projects which may get approved.

We have to redo the laws which allow virtually anyone (anyone who has access to lawyers, anyway) to impose a delay of almost any duration on any project at virtually no cost to themselves but huge cost to the project. BTW, it not just "environmentalists" or people protecting the view from their backyards who delay projects; business is very adept at using regulatory delay to stymie would-be competitors. The law should require anyone who appeals a granted permit to post a bond equal to the cost of delay, such bond to be forfeit if the appeal fails. Note that this does not discourage participation in the initial regulatory process by those opposed to a project.

Faster regulation is better regulation. During a twenty-year approval process, the world changes. Yesterday's projects finally get approved for today's world. Project benefits are delayed; and stop-gap measures have to substitute for larger projects.

A shovel-ready America will be an awesome competitor in a globalized world. We will build the infrastructure we need to link our mines, forests, fields, dams, power plants, and factories – just as we have done at least before with canals, railroads, pipelines, and highways. We'll build 21^st century information infrastructure. The projects are already in queue; the money is in hand; but we're not shovel ready.

Related posts:

Energy for Jobs – Vermont Version

What Government CAN do to Create Jobs

Confessions of a Stimulator

Will Googlerola Be Able to Fight Data Caps?

"Is Google Turning Into a Mobile Phone Company?" asks the headline in Andrew Ross Sorkin's New York Times story. Wrong question, IMHO.

But is Google doing the deal at least partly to give it leverage over wireless providers? I think so. The biggest threat to the growth of Smart Phones and tablets and other Google businesses like YouTube is the imposition of data caps and metered pricing by wireless providers like at&t and Verizon Wireless.

The providers would like to charge by the number of bytes transferred – similar to the way they charge for voice minutes today. Content providers (including Google) don't want an expensive impediment in the way of their content distribution. Providers of software and hardware for tablets, Smart Phones, and computers (including Google) don't want these devices to be less useful because content delivery to the devices is expensive. Not a moral issue here but a business one, although – in the long term – I think unlimited data plans lead to more growth for everyone (and proved that to my own satisfaction with the launch of AT&T WorldNet, which popularized all-you-can eat pricing way back in dialup days).

Today the handset manufacturers, with the exception of Apple, are at the mercy of the carriers, especially in the US where most phone are locked to the wireless network that subsidizes their initial purchase. If the manufacturer doesn't have a deal with Verizon or at&t, they can't get the volumes they need to be a serious player in the US market. iPhone as a must-have device for networks began to upset that balance of power; but Steve Jobs hasn't yet used Apple's muscle to build a US market for open iPads or iPhones which can run on any network given the right prepaid SIM card.

But Google is much more in the content business than Apple is – even given iTunes. Google has more to gain by stopping the spread of bandwidth caps and metered pricing before they become universal for wireless and spread to wireline as well. Google knows that the wireline providers, especially the cablecos who don't want their chokehold on content delivery loosened, would like nothing better than to move to metered pricing themselves.

A handset maker owned by Google can introduce a product without carrier backing and without the need to lock into any network. The product can be cheap to grab marketshare; the product can be subsidized through ads delivered rather than voice or data minutes sold. If the product is incredibly compelling as well, the major carriers will be forced to let it onto their networks as an open device. Customers who bought their phones from Googlerola will find it easy to switch between networks to get the best deal. Competition between carriers will then be based on service quality and pricing only; competitive pressures may well force them back to offering unlimited data. Google wins both as a content provider and as a client provider.

The announced at&t/t-mobile deal will, if approved, shift power to the carriers by eliminating a disruptive competitor and concentrating spectrum ownership. The Google/Motorola deal shifts the balance of power away from the carriers.

Dan Frommer speculates:

"If Google and Motorola can push the price of smartphones down even more, and if carriers can accelerate the uptake of mobile data plans, this could be good for them. But there's also the chance that Larry Page has a long list of wacky, disruptive ideas he wants to try, focused around handset distribution and pricing, ad subsidies, etc., which could take real leverage away from carriers. Their path toward dumb pipe status seems to be increasing by the deal. This will likely end up better for consumers but could be annoying for the carriers."

But it doesn't stop there. As Peter Kafka points out on All Things D, Motorola Mobility, the company that Google is proposing to buy, is the world's largest provider of set-top boxes. Suppose set-top boxes were not subsidized by or distributed through cable and satellite companies. Suppose they came from Googlerola and were so good at what they did and so cheap on the open market that the content distribution networks had to offer them without a specific lock to their content in order to stay in the broadband ISP business (even though they'd still be able to charge for content). That would be the end of any thought of metered pricing for wireline Internet service. Another threat to Google would be eliminated. More content opportunities would open up.

The acqusition be all about the patents as most people are saying and as Google broadly hinted; but, as Stacey Higginbotham and Katie Fehrenbacher writing on GIGAOM say: "if Google wants to use Android as a way into the home, Motorola's home automation, set-top box and broadband gear businesses now gives Google a platform from which to jump."

Related posts:

Subscription Pricing

Apple Fails to Reinvent Telecommunications Industry – Too Bad

AT&T Bids to Shut Down Mobile Competition

Energy for Jobs – Vermont Version

Program: Energy for jobs

Idea: We can make Vermont attractive to manufacturing with a combination of our great workforce and energy which is cheap (and clean) by East Coast standards. Manufacturing provides jobs for all skill levels and is an engine for economic growth in general. Low cost energy also makes Vermont more affordable.

The Five-Step Subsidy-Free Program: (unique Vermont advantages in italics)

1. Canadian hydro power. Work with Canadian producers to have electricity routed through Vermont as it goes south. Pre-permit to take advantage of New Hampshire delays on approval. Part of the deal is flexible access to part of the load at attractive rates. We're a border state.
2. Natural gas. Pre-permit both the expansion of Vermont Gas south from Burlington and a corridor for Marcellus Shale gas supply from Whitehall to Rutland and eventually beyond. Create standard permits for gas cogeneration giving both heat and low-cost electricity. Look for private investors (EB5?) to build a good-sized natural gas to electricity plant in Rutland area. Switch the state fleet and buildings, schools and school buses along the pipeline route to natural gas (helps incent pipeline and fuelling station builders without subsidy AND saves operating expense and reduces CO2). Buildings can do cogen as well. See if Interstate corridors can be used for NG pipelines to the rest of the state. It looks like NG will be a low cost direct energy and electricity source for a long time to come. It's domestic. It's much cleaner than oil. We're near the Marcellus Shale formation.
3. Off-peak electricity. Use the Smart Grid to offer great deals on way off-peak electricity to businesses and residences. Clever manufacturers may save their energy intensive processes for night and displace other fuels; citizens can save money – perhaps even by plugging in cars off-peak as prices for plugins fall (subsidies are cheating!). Increasing off-peak demand and flattening the load curve lets Vermont power companies increase their electricity purchases at low base load rather than peak rates and further brings down the cost of electricity. Vermont is on track be the first state in the nation with full Smart Grid coverage.
4. Nuclear power. Allow the Public Service Board to move ahead on Yankee's relicensing while planning to replace it in ten years with a much more modern and efficient plant, which incorporates all the lessons learned in nuclear power. We have a paid-for nuclear site with needed infrastructure and extremely low current cost of electricity and a distribution grid radiating out from it.
5. Energy efficiency projects. Direct all state "energy efficiency" dollars from whatever source to projects with actual dollar and cents benefits to taxpayers and with paybacks less than 10 years. Hire private businesses to do the work using competitive bidding – but don't subsidize them. This means making state building, vehicles, and state-supported resources like schools and affordable housing energy efficient (see yesterday's post on Barre project). Insulation, solar hot water and geothermal would definitely be in; solar photovoltaic would be out unless and until cost effective. We have biomass, wells and ponds for geothermal heat pumps, and unshaded rooftops for panels for solar hot water.

 

Our location, work force, existing nuclear plant, Smart Grid head start, and rural environment can be unique advantages. It's up to us, all of us, whether we take advantage of them or not. Good thing for our legislature to concentrate on this year.

 

Related posts:

 

A Good Use of Our Tax Dollars for Renewables

How to Increase Your Electric Bill to $630 per Month

Natural Gas Disrupts the Energy Industry

We Need to Use More Electricity

A Good Use of Our Tax Dollars for Renewables

The solar hot water equipment being installed at the Highgate "affordable-housing" (subsidized housing) complex in Barre is a good use of our tax dollars whether looked at from an economic, environmental, or plain old good-governance point of view. According to an article (subscription required) by Peter Hirschfeld of the Vermont Press Bureau, this project will more than pay for itself over its twenty year life, directly eliminates the need to import and burn 5000 gallons of oil per year, and reduces the cost of running the housing complex so presumably decreases the subsidies needed to keep the housing affordable in the future. In other words, the benefits from spending taxpayer money go to the taxpayers.

Unlike solar photovoltaic (generating electricity from sun light), solar hot water heating actually makes economic sense at the current costs of other water-heating fuels – even in Vermont's sun-challenged climate. You do, however, have to have a backup system if you want to shower on cloudy days and in the middle of the winter. But the economics work, even with the backup system and its need for fuel. According to the Press Bureau story, the full cost of the Barre project is $300,000 of which $133,000 is from a federal grant; payback is thirteen years – actually atypically long for solar hot water but still a positive payback - on the full project cost. Amortizing the capital cost over 20 years (but without adding in interest), the hot water produced will cost about as much as if it were produced with $3.00/gallon heating oil. Currently heating oil is close to $4.00/gallon although it could fall this winter.

Unlike solar photovoltaic in Vermont – which is much more heavily subsidized than solar hot water – every bit of energy produced by this project directly reduces the need to import and burn oil. We use almost no oil to generate electricity in Vermont and we have the lowest carbon footprint in the country for our electricity generation since two thirds of it comes from nuclear and hydro and the remaining third from relatively clean natural gas. However, we green Vermonters have a very high carbon footprint overall because of our dependence on oil for heating and because we drive a lot. The Barre project is a small step towards solving a problem we actually have. Since it pays for itself, it's a "sustainable" step.

Even though this is a time when we especially need to scrutinize all government expenditures, this capital expense is justified because it reduces the need for future government spending. The benefit from the federal grant which helped fund this project goes to the federal taxpayers who funded the grant. Grants for solar photovoltaic, on the other hand, actually drive up the cost of electricity because utilities must buy it at five or six times normal wholesale and the benefit goes to those who developers lucky enough to get the grants rather than to the taxpayers who fund the subsidies.

A good government energy policy would consist of using taxpayer dollars only for increasing the energy efficiency of assets which belong to or are funded by taxpayers. There is an enormous potential for saving both energy and public dollars by making government a more efficient user of energy. And, because government is such a huge purchaser, a rational government energy program will help develop healthy energy-related businesses all over the country. On the other hand, subsidies to producers of over-priced products like corny ethanol and solar photovoltaic farms just use our money to create "businesses" which will fold the minute the subsidies are removed.

Related post:

How to Increase Your Electric Bill to $630 per Month

Lots of Live Discussion of the (High) Price of Solar Electricity

Is the price Vermonters pay for solar electricity too high and counter-productive? Or are the subsidies from ratepayers and taxpayers necessary to save the environment and the economy? I asserted "way too high" in a post last week. I'll be grilled Thursday both on the Mark Johnson show on WDEV and on Vermont Public Radio's Vermont Edition.

David Blittersdorf, who says that the current subsidies are too low, is scheduled to appear with me on Vermont Edition. He is a cofounder of Chittenden County Solar Partners, which opened Vermont's largest solar farm last week, and Founder, President, and CEO of All Earth Renewables, which supplied solar tracking arrays to Solar Partners. He says that facility would not have been built except that subsidies used to be higher than they are today. David and I are alike in some ways; we're both entrepreneurs, both former board members of Vermont's Clean Energy Development Fund, and both nerdy types proud of the patents we've been awarded; but we have very different views on subsidies for solar photovoltaic energy. Vermont Edition, which is hosted by Jane Lindholm, is live at noon (rebroadcast at seven) and available as streaming audio and later online in the show's archive. You can call in during the show if you think one or both of us need further grilling or rebutting.

Mark Johnson is a fearsome radio interviewer. It's not that he yells and screams; he doesn't do that; but he has an instinct for the weak point in an argument. And politely but firmly insists on getting a straight answer. His show is on from 9-11AM and I'll be coming on at 10AM on Thursday – hopefully well-prepared. You can listen to WDEV over the air at AM 550 and FM 96.1. The show is streamed from a link at the bottom right of this page and is archived at markjohnsonshow.com. You can also call in during this show.

Related posts:

How to Increase Your Electric Bill to $630 per Month

We Need to Use More Electricity

What Government CAN do to Create Jobs

"It's time to go big or be sent home," says Andy Kessler writing in The Wall Street Journal. He continues with six big ideas, none of which involve throwing money at the problem or hiring more government workers. If you have an online subscription to the WSJ, you ought to read Five Ideas to Kick-Start Job Creation: "Entrepreneurs don't want government money. They want the chance to invest their sweat equity" now. The ideas are summarized below along with some comments from me and one additional idea.

Free spectrum: Andy means the radio spectrum, lack of which is hindering even more development of wireless apps and perhaps a whole new generation of innovative services. Look at what WiFi and Bluetooth have made possible not to mention smartphones. He'd free up spectrum by allowing current licensees to sell what they have, instituting a "use it or lose it" rule, allowing multiple users of the same spectrum (aka whitespaces) and/or repurposing spectrum government has reserved for its own use. Remember, tech companies are sitting on piles of capital; they need to see opportunity to use it. Great idea, IMHO; jobs created won't only be in high tech since communication is an enabler.

Disease diagnostics: "Have the Department of Health and Human Services declare that Medicare will pay for any diagnostic test or device that can be proven to save money over five years…" Although I agree that invention and deployment of early diagnosis technology is a huge opportunity, I'm skeptical of running this through the HHS bureaucracy. Perhaps better to streamline the approval process for new technology (get government somewhat out of the way) and reform the dumb implementation of privacy requirements which make it very difficult to use medical information well.

End the mail monopoly: Andy says this will speed alternatives of automatic bill payment and innovation by USPS and FedEx.

Frack this: This is probably the biggest of all Andy's big ideas. Cheap energy can and will create manufacturing jobs in the US even without a supply of ultra-cheap labor. His method: "Declare all hydraulic fracturing legal with the caveat that drillers put up a bond equal to the potential cleanup cost of environmental damage." Andy is rightly concerned that, even though – thanks to hydraulic fracturing – shale gas has grown from 1% to 25% of our natural gas supply in the last decade and natural gas prices have been falling while other energy prices rise, "environmentalists are pushing to close down this booming industry."

Government platform: "All government agencies should be required to publish their own APIs by the end of the year. What will happen next is a sea of programmers will emerge to write iPhone apps and other code to integrate government functions into our everyday lives." Good idea but ain't gonna happen anytime soon. What Andy doesn't know because he hasn't worked inside government is that many of these apps are still running on mainframes from 80s and 90s. Even more are batch COBOL monstrosities with no prospect for supporting realtime apps. First got to get government applications off legacy platforms and into the cloud where they belong.

Rental society: Andy is suggesting creation of a six-month foreclosure amnesty during which you can initiate foreclosure proceedings on your own underwater mortgage and not have the foreclosure affect your credit rating. He is certainly correct that this would result in "exactly the price discovery that the finance sector both dreads and needs to move forward." He predicts an immediate boom in web-based rental and auction sites. Rather than suppress credit records, I'd prefer ending the policies which allow banks to avoid full write downs on underwater but not foreclosed mortgages and the series of bailouts which have allowed banks to avoid banks moving to either rapid reduction in principal amounts or foreclosure.

Bonus idea – Make America shovel ready: (this one from me and not from Andy). Stimulus demonstrated conclusively that nothing in America is shovel-ready. Government can't get out of its own way when it comes to major infrastructure projects. Endless appeals delay not only government but private sector projects indefinitely making financing impossible to line up and greatly increasing cost. The private sector is sitting on hordes of cash. Much of it would flood into construction costs and finance needed infrastructure IFF projects could get final approval (or disapproval) quickly and predictably. My proposal: 1) set a two-year schedule for all government permitting; 2) require anyone appealing a permit which has already been granted to post a bond equal to the anticipated cost of delay, such bond to be forfeit if the appeal fails.

Related posts:

Go White Space, Young Person, Go White Space

Confessions of a Stimulator

Natural Gas Disrupts the Energy Industry