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Back to Business

Retirement's over; I've been working on a new business. That's why I haven't been blogging for a while; startups are all-consuming.

NG Advantage LLC delivers natural gas "beyond the pipeline." Starting in early 2013 we'll truck compressed natural gas (CNG) from a compressor site we plan to build in Milton, Vermont to commercial users within a two and a half hour driving radius (see service area in VT, NH, and NY below). Large users of fuel will save 30 to 40% or more of what they're paying now for oil and propane while reducing CO2 emissions by 26% and practically eliminating sulfur and nitrous oxide from their stacks. Businesses which are not on pipelines need these savings to compete with those who are served by pipeline gas. Energy intensive businesses also need protection against the global uncertainty in oil prices.

So, if the savings are so great and it's good for the environment as well, why don't businesses like NG Advantage already exist?

Good question and there's a good answer. Until 2008 the prices of natural gas and oil products moved pretty much in lock step. If one or the other got a little out of line, there were enough users that were dual fuel – primarily power plants – to switch and bring prices back to parity on a per BTU basis. But new technology has come into the gas fields: horizontal drilling and hydraulic fracturing (unfortunately called fracking). America's recoverable reserves are an order of magnitude larger than they were originally thought to be. Production is increasing rapidly.

This is disruptive innovation in the same sense that the Internet was: it changes all the rules in the energy business. It no longer makes economic sense to build a new nuclear or coal plant in the US; electric rates are remaining stable or going down because the marginal cost of electricity depends on natural gas prices. Energy-intensive businesses are being built in the US again. And it now makes economic sense to truck natural gas to major consumers who can't get it from a pipe.

The US benefits especially from natural gas because it is NOT easy to transport – it must be either liquefied or compressed and must be carried in special vehicles (although it is safer to transport than oil or propane because it is lighter than air). It was only practical to use natural gas directly from a pipeline; it is now practical to truck it short distances as well. But the market for natural gas –unlike oil - is more local than global because pipelines don't go under oceans. Europe is stretching for new supplies and increasingly dependent on Russia for natural gas. North America has an abundant supply – President Obama says 100 years' worth; so natural gas prices are much lower here than in Europe or Asia. Our reindustrialization benefits from this energy price disparity. So does our effort to reduce our dependence on foreign oil.

Fifteen years ago I founded ITXC, which became a big company and went public, because it was clear that the invention of the Internet would take most of the cost out of telephone calls and the big telephone companies – including AT&T where I then worked - were in no hurry to crater their revenues for the benefit of their customers. There was an opportunity for new companies looking for new customers and willing to offer radically lower prices to succeed. This is another such opportunity since existing oil companies won't be in a hurry to turn natural into a competitor beyond the pipeline. We won't be the only ones to take advantage of the opportunity, but it's important to be first or among the first

Unfortunately current trucking technology doesn't support the economics of serving residences or businesses which use less than 150,000 gallons of oil or propane annually or 100,000 gallons in a six month period. We may be able to move downscale some; others will need pipelines before they can take advantage of natural gas.

Vermont Gas Systems is planning an expansion southward of their line in northwestern Vermont; that's a good thing for those residences and businesses along the path of the expansion. Since it'll be several years before the expansion is built, NG Advantage will serve major businesses along the route until the pipeline gets to them. And we'll serve businesses in Vermont and parts of New York and New Hampshire which have no immediate prospect of pipeline connections. I'd be surprised, though, if we don't end up developing markets which will then be served by pipelines faster than they would have been otherwise. That's fine with us, a measure of success; we just move our trucks out further to new areas.

We're starting to hire so we are creating jobs. But many more jobs will be created and retained because energy-intensive businesses in rural areas, where many costs are low but the price of energy is high, will be able to compete in an irreversibly globalized economy. In Vermont both food processors and manufacturers fit that definition.

Anyway, it's good to be back in the private sector. I'll blog when I can, not just about natural gas but also about how starting a business now is the same and how it is different than it was 15 years ago – not to mention lessons learned.

Related posts (while I was talking myself into doing this):

Natural Gas Disrupts the Energy Industry

The Pickens Plan Bill: The Wrong Way to Get the Right Result

Ending Tax Giveaways Isn't Raising Taxes

Good and Bad News about the Safety of Natural Gas Fracking

The Latest on Speeding Neutrinos

Son Jarah was interviewed last week on CRI, China's English-Language equivalent of the BBC. The subject was the possible evidence of neutrinos traveling faster than the speed of light, which came from an experiment at CERN. Here's the show description from CRI:

2011-12-02 Speed of Light
The Speed of light. It's the universal speed limit. A constant that has informed physics since Albert Einstein laid out his theory of special relativity.
But a new experiment may disprove all of that. The OPERA lab in Italy has early results suggesting that sub atomic particles called Neutrinos may travel faster than the speed of light.
Today our panel of experts are taking a look first at the experiment itself, then at the reactions and impacts to the discovery and finally at the outlook of physics in light of these new results.
- Jarah Evslin, Professor at the Institute of High Energy Physics at the Chinese Academy of Sciences.
- Alexander Vikman, a CERN Fellow.
- Giovanni Amelino-Camelia, A theoretical Physicist from Sapienza University of Rome.

111202today1[1]>The Interview

When asked about a paper by a Nobel-laureate which says that the CERN results can't be right because they are theoretically impossible, Jarah says "Of course a theoretical argument cannot disprove an experiment, only a failure to repeat the experiment by another group can do that." All three interviewees are thoroughly scientific in both their skepticism about the results of an experiment which has yet to be independently replicated and their willingness to consider that a long-standing interpretation of Einstein's Theory of Special Relativity may be wrong despite the fact that it's accepted wisdom.

Jarah actually gives Einstein a hall pass and says that special relativity only claims 1) that nothing can exceed the speed of light IN A VACUUM (the possibly superluminal neutrinos were passing through the very solid crust of the earth); and that no subluminal particle can become superluminal (the neutrinos probably began their journey at - not below - the speed of light).

All three scientists agree that the CERN results are "probably" wrong. However, the last question of the show is "are we on the brink of a major shift in our understanding of the universe?" Only Jarah says "yes".

Jarah's latest paper on what the OPERA experiment might tell us if confirmed is at http://arxiv.org/abs/arXiv:1111.0733.

related post:

v-c: What If It’s Positive?

 

Great Docs and Technology Saved My Life Thursday

"You flunked the stress test," was the essence of the call Tuesday morning. I'd thought I aced it. "Don't do anything you don't have to. We'll get you in to see a cardiologist ASAP."

"But I got through the whole test," I told the cardiologist that afternoon. "The EKG was normal; they were surprised that it took so long to get my pulse up but that's because I climb mountains and play tennis all the time." I was in denial, just as I've been when I got the first mild chest pains during warm up for racquetball last spring and played through them; just as I was when my chest tightened at the beginning of most spring climbs and I kept walking (but a little slower). My denial had faded some in early summer when I woke up twice with chest pain, took two Excedrin, and went back to sleep. But it was only a little pain; really just pressure on my sternum. And it stopped happening.

Because I time everything and my Garmin watch tracks my pulse, I knew I was climbing mountains more slowly and reaching lower maximum pulse levels even though the pain went away. I hiked alone so people wouldn't have to wait for me (Bruiser, my labradoodle, can always find something to sniff while he's waiting). It bothered me that I was losing at tennis, usually in the second and third set when it was an effort to get my arm up to serve. I tried jogging to get in better shape and couldn't quite run a mile on the flat. But I am 68, getting older, but… So I asked my doctor to make an EKG part of my upcoming physical.

"There's a slight abnormality," she said. "And you have a lousy family history. I think you should take a stress test." I really did think I aced the test. I felt good. I could see the inside of my heart on the echocardiogram and it even had cool Doppler, which used color coding to show the velocity of blood and tissue in both directions. It looked like there was a cheerful little guy standing in the middle of my heart waving his arms up and down (the valves) and cheering me on "Yay, Tom. Yay, Tom." They took video of the heart at rest; then the treadmill up to 142 pulse; then more pictures so they could compare the stressed heart to the resting one.

"Much of the muscle wall of your left ventricle is not participating in the pumping after stress," the cardiologist said. "The test has only about 10% false positives. The most likely cause is a blockage in one or more arteries. You could die suddenly from that condition, most likely from a piece of plaque breaking off and corking something crucial. You should have an angioscopic examination to find where the blockages are." That means, in case you don't know, that a catheter is threaded through your groin or wrist artery into the arteries which supply the muscles of the heart. It injects die, which makes the blood flow show up clearly on a monitor.

"And then what," I asked?

"If the blockage is not too widespread, they'll put in a stent immediately as part of the same operation while the catheter is still in place."

"I've heard about stents," I said; "aren't they overused?"

"They're not overused here in New England," said the doctor. "The financial incentives are different and we tend to be very conservative in the use of stents." He explained that the most statistically significant trial of stents vs. medication alone vs. bypass surgery is somewhat inconclusive. The long term survival rate was about the same with either medicine alone or stents plus medicine. However, in the first three years, quality of life is better with stents because the blockage is immediately dealt with. Long term results are about the same for bypass surgery as stents for relatively simple cases and better with surgery for complex cases. Stents do sometimes have to be redone. There is, of course, more mortality associated with the bypass operation itself and recovery is lengthy and painful (as I know from friends and my father). One reason why results from all three approaches tend to converge over time is that people develop new blockages at new sites after the first blockages are cured – either because they haven't changed their lifestyle or because they can't change their genes.

Since the big trials were done, a second generation of drug-eluting stents has been developed which should be better than either uncoated stents or those coated with the first generation of medicine; so quite possible the next big trial will show significantly better outcomes for stents than either medicine alone or bypasses when there is an option to use stents instead of bypasses. The drugs discourage the body from growing new plaque inside the stent but do increase the risk of clotting. To counteract that risk, you take blood thinners for a year.

I checked all that on the web with the help of my brother Lee, who is a pediatrician with a strong interest in and knowledge of overall health. And I scheduled a second opinion just before the angiogram was scheduled to begin Thursday. I had no doubt I wanted the diagnostic information from the angiogram; I was skeptical I wanted to go right into having a stent inserted and knew, although I'd be awake through the operation and when we learned what the angiogram showed, I'd be much too dopey to give informed consent to anything at that stage.

"The EKG was normal," I said. I'm now back in denial. The report even says that my "functional capacity was above normal. I don't do anything with good form; maybe my heart doesn't either. You've already explained to me that it's normal to find some blockage in almost everyone, even children. How will we know I really need a stent? Maybe there isn't any serious blockage."

"There's a 99% chance, in my opinion, that you have a serious blockage – by which I mean a blockage of over 70% - in at least one artery," the cardiologist explained. "If there's no blockage above that level, we'll do nothing and have to reconsider what's causing the symptoms. If there are one or more blockages above 70%, if there aren't too many and they aren't too complex, we'd like to stent immediately. If it's worse than that, we'll stop and can consider options later with the new information we have. You wouldn't want the surgeon to put in stents if he doesn't think they'll work, would you?" He also told me, politely, that I'm not more qualified to determine whether I need stents than cardiologists are.

"OK," I said begrudgingly. "Numbers I can live with. Less than 70%, no stent. Too complicated, we put off the decision. Over 70% and relatively simple, stents away. But, if the decision is on the cusp, two things I know that the surgeon needs to know: I will stick with any post-op regime and I'd gladly take some risk to be able to stay active." We had a deal. Time to get prepped for the operation.

The surgeon was ready so two nurses prepped me fast and efficiently. IV already in, I said good-by to Mary (we were both scared) and was wheeled to the operating room on a gurney. The surgeon threaded the catheter in through my right wrist and guided it to the arteries serving my heart; I'm not quite sure how. I'd hoped to watch the catheter on the TV screen next to the operating table – maybe I did – but the sedative you get for this operation makes you forgetful even though you can respond to requests to move this way or that. I do remember him saying that they'd found 98% blockage in a major artery and showing me that on the screen. I could see that the thick flow of blood simply stopped at one point and became a tiny stream. "Can you stent it?" I remember asking.

A balloon is threaded over the catheter and the stent is paced over the balloon. The balloon is inflated in the blockage and compresses the plaque back to the artery walls (angioplasty); the same inflation expands the stent so it stops the walls from rebounding. Catheter removed from the tiny hole in my wrist. "It's done," he said some time later. "Do you want to go home tonight?"

The surgeon went off to talk to Mary and show her the video. Soon she rejoined me in recovery; I was out of the hospital at 6PM; amazingly just five hours after the operation began. In a week I can resume full activity and will, quite possibly, hike faster and win at tennis.

I was really stupid to ignore the first symptoms, especially to try to walk them off by hiking alone (please don't do the same). I am lucky to live in a time when techniques like echocardiography exist. The previous stress test I took relied on EKG only – and showed no problem. The EKG showed no problem this time; it only showed up on echocardiogram. I was also lucky to be treated by an amazingly skilled and compassionate team associated with Fletcher Allen Health Care. We're very well-served having them here in Vermont.

Reaction to Confessions of a Stimulator

Wall Street Journal publication of the lead article from my "Confessions of a Stimulator" series not only had a healthy comment thread of its own but led to other main stream media attention as well as blogosphere discussion.

Derek Thompson wrote a post entitled "Vermont Stimulus Czar Has Smart Critique of the Stimulus" on the Atlantic's website. Although he's not convinced of my assertion that the Stimulus had a negligible impact on overall employment, he says "But that aside, this is a smart criticism of the inner-workings of the stimulus and more evidence that even smart ideas in the abstract can run up against the messy array of interests at the local level."

On the other hand, after Ezra Klein at the Washington Post ran a link the WSJ op-ed, he got a steaming email in response from Gary Burtless at the Brookings Institute which Klein ran almost in its entirety. Gary says the op-ed is "silly" and goes on to demonstrate. IMHO, that he doesn't understand how Stimulus actually worked. But it's worth reading his POV (and my comment at the end of that).

This debate will continue because National Public Radio invited both Gary Burtless and me along with Washington Post columnist Harold Meyerson to be guests on "To The Point" hosted by Warren Olney. The live interview is Monday, January 3, between 2:10 and 2:45 PM ET; I'm not sure whether it is carried by all NPR stations or whether all carry it at the same timea  list of NPR stations which carry the show and the times they carry it is at http://www.kcrw.com/news/programs/tp/station-list . It is also available as a podcast from NPR, however. I'll tweet a reminder, which you'll get if you follow me at http://twitter.com/tevslin.

I've also been invited to be guest on Fox Business News but the time hasn't been firmed up yet.

Meanwhile Confessions of a Stimulator – Jobs Don't Count, the second post in the series, ran on Fractals of Change and was also carried by vermonttiger.com (whose editor Geoffrey Norman was key to getting the WSJ op-ed run), vtdigger.org where there was an especially vigorous discussion and much disagreement, and the investor site seekingalpha.com, where there was general agreement with my criticism of parts of Stimulus but also dissent on my blanket condemnation of TARP. Blog.nextblitz.com had an approving post by Galeal Zino, and Joel West on Open IT Strategies defended me from charges of being a bureaucrat. Funny note: while googling "Evslin stimulator" to see where my posts were mentioned, I found my grandfather's patent for a stimulating adjustable toothbrush which was granted in 1929.

There are no simple answers to the questions "was the Stimulus Act a good or bad idea?" or "did the Stimulus work?" Over $800 billion was spent on roughly 300 different programs. As Vermont's "stimulus czar", I did my best to make the programs work for Vermont. Some did work; some failed; some have just begun. Some of the failures were mine; some of the programs were doomed from the beginning; others might have succeeded if implemented differently; some programs were downright harmful (not just expensive).

Since I had responsibility for these programs here and was the liaison with Washington, I had an inside view. Unlike most of the stimulus czars from other states, my career has been as a high-tech entrepreneur, so I have a businessperson's viewpoint of Stimulus and the governments, organizations, and people who were and weren't stimulated by it. Since I re-retired at the end of my state stint, I can speak frankly about what I saw.

Every project needs a post mortem so we can do better next time. The purpose of my series is to learn as much as we can from the gigantic and expensive Stimulus Act, both about what worked and what didn't – and about the limits to what government can do and should attempt to do. This won't be the last economic crisis we face nor is the "crisis" truly over.

Getting Back Online

You don't want to be without your computer at the Hyatt Regency O'Hare; my computer was stolen the day before in a smash and grab. The hotel has a business center, which is run by FedEx; the charge for using a slow computer there is $.40 PER MINUTE; printing is extra, almost $1.00 per page. This follows the inverse price rule with which business travelers are familiar: the higher the nightly charge, the less amenities like free WiFi, parking, breakfast, and use of computers.

In the sleepless hours before dawn, after changing my passwords, I'd made my plan. Bought a couple of computer mags at SFO to read on the way to ORD to get hints on the latest in laptops. On arrival would go right to the business center and fill out the online accident report for Hertz, order a restore CD to be overnighted from Mozy- where hopefully I'd backedup everything I needed to restore, and I'd shop online for a computer.

In the laptop mags I learned that 15 inch screens don't have any more total pixels than 14, but are harder to carry and – even more important – drain their batteries more quickly, was reminded that keyboard backlighting is a good thing, noticed how much more powerful video processors have become except in "business" machines, and saw that ThinkPads still have the eraser tip cursors that I prefer to touchpads for portable mousing.

OK. Better submit the Hertz form before shopping. It's at https://images.hertz.com/pdfs/VIR20090515.pdf if you'd like to see an example of how NOT to design an online form. In order to enter numbers you put one digit in each space and then click with the mouse to the next space, tabbing gives you an edit error. If you just type numbers they all run together in one number space. Found, reasonably enough, that Hertz wanted me to supply the number of my own insurance policy (I didn't pay for the collision damage waiver, of course, but Visa is supposed to cover that) so postponed completing the form.

Was disappointed to see that Mozy wouldn't promise delivery of the restore disk before three or four business days (but the disk did actually arrive in two days).

Shopping online, even forcing myself to ignore the $.40/minute charge, was frustrating. I'd decided not to buy my third Toughbook in a row even though I'd liked the two I had. Now most boats have a GPS and so does my phone; so I don't really need one in a waterproof computer with a touchscreen. The Toughbook graphic processor didn't let me take advantage of wide desktop screens; the machine is fairly slow; and typing on the waterproof membrane keyboard (optional) made me miss a lot of letters I had to go back and fill in later; the touchpad was so bad that I always carried a mouse. But it was great not to worry about dropping it or getting caught in the rain; and it doubled as a footstool on long flights. Anyway, the decision was easy because it takes a long time to get a Toughbook configured the way you want it and email on my Droid was quickly becoming a pain.

Nothing else I wanted was available quickly either. Dell has a page for machines that can be shipped immediately but all too low end (they ought to let you specify the shipment window you can accept and then search). Thinkpads, fuggetaboutit. BestBuy can tell you when you can pick up a particular model in a particular store or when it will be shipped to you; but none of the specific models I'd been attracted to in the computer magazines were available in any reasonable period of time. Not much luck with a couple of other online retailers. Realized later when I shopped for peripherals that I should have tried Amazon; they do seem to be able to ship immediately even when the manufacturer they're buying from can't.

Anyway, decided to go to BestBuy and search in person. You do want to try keyboards before buying. A cab to BestBuy wasn't much more expensive than shopping online in the business center. Looked at every instock Windows laptop and decided without too much thought (the cab was waiting outside) to buy a 14 inch Toshiba Satellite E205 with 4GB of RAM, 456GB harddrive, and 64 bit Windows Home Premium. It claims five hour battery life, has an LED backlit display and keyboard, USB sleep-and-charge so you can turn off the computer and still charge stuff, and a wireless way to transmit to your HDTV screen. About $800 dollars before tax and including the receiver that plugs into the HDTV.

So now I had my own computer to complete the Hertz form with, although, this being an expensive hotel, I had to pay for WiFi ($10 from t-mobile and it still worked the next day in the airport) . Called my agent and got my policy number. But, even with everything filled in to the best of my ability, each time I clicked the "send" button I got a message saying there was an edit error but not telling me where or how to fix it. Couldn't print and fax (without going back to the business center). So I printed to Microsoft XPS Document Writer which creates a file, and emailed the file to Hertz. Asked for a confirmation of receipt which I still haven't gotten three days later.

Next steps: loading and learning the computer.

Beginning of the story: Blog Blocked by Breakin.

Blog Blocked by Breakin

Shards of shattered window glistened on the asphalt and on the backseat where my laptop bag shouldn't have been so conspicuous. The bag was gone, of course, and with it the laptop, extra batteries, several cables and chargers, a mouse, a USB multiport, my Garmin watch and chest strap, miscellaneous pills, and whatever else had accumulated in the bag's many pockets. I always put the valuable stuff in the carryon bag so it won't get lost by the airline. Ironically the to-be-checked suitcases lightly disguised under the hatchback weren't taken, and Mary's carryon bag was still on the floor of the back seat. Truly a smash and grab and a lousy way to end a great week visiting grandchildren and their parents.

The purpose of this post isn't to whine, though, or even to make an excuse for not blogging for a couple of days (there's an unfinished post still on the laptop – maybe). The real story is about technology, reconnecting, and help from the cloud.

First things first: Mary called the cops; I called Hertz. The very polite Sunnyvale police told us we were unlikely to get the computer back; but opened a case and gave us a number. You can't file any claims without a number.

Hertz said they'd come and tow the car but that I'd have to go the Hertz office to file a report, not what I wanted to at the moment since son-in-law Hugh kindly said he'd drive us to the airport hotel and we didn't need another car. They said I had to; but, when the human hung up, a robot gave me further instructions for reporting an accident, which said I had 24 hours to report and gave the URL of an online form. Much better.

The stolen computer has built in Verizon wireless connectivity so, while waiting for the tow truck, I 611'd VZW. I could get to the place in the voice menu where it asked if I wanted to cancel the phone I was calling from – "Duh, no". But I don't know the pseudo phone number associated with the radio in the phone. Pushed zero for an operator. Was told zero is not a ten digit number. Tried zero again. "Push zero to confirm you'd like to be connected to an operator." Did that. Robot hung up. Tried again; same sequence; same result. Calling and immediately saying "operator, operator" AND pushing zero did get through to a very helpful human who retrieved the computer's number and suspended it without inadvertently killing the phone which was now my only remaining connection.

In the hotel in the middle of the night it occurred to me to worry whether I had let the browser remember my password for anything important. The computer itself was protected by its own password but I assume someone knows how to hack through that. Decided to change my passwords for Google, PayPal, and Amazon; but, of course, had no computer to do that with. Took my Droid into the hotel bathroom and fired up its browser. All three of these services have mobile-formatted pages but none of them let you change a password without going to the regular version of the website. I could never have done this on my old Blackberry but did get the passwords changed for Google and Amazon. PayPal's site and the Droid couldn't agree about where on the screen I was touching (clicking); and PayPal was the service I cared about most.

Ah, but I still had my Kindle, which had been in Mary's bag. Kindle has Internet capability. Used that to change my PayPal password but didn't quite get back to sleep before it was time to get up for the 6am flight.

There was a lot not to panic about. My computer, except for the partially completed post I'd worked on that day, was backed up in the Mozy cloud. Incremental backup happens every connected night. I wasn't out of email touch since I get and can respond to email on my Droid. My contacts and calendar are not only on Mozy but also on Gmail thanks to gsyncit; and they replicate from gmail to the Droid. A year ago I would have been much more concerned and much less connected.

next the world's worst e-form, an unfriendly business center, and training a new computer: Getting Back Online

Confessions of a Stimulator

I was Vermont's "Stimulus czar", a fascinating position to have after retiring from a career as a high-tech entrepreneur. As Chief Recovery Officer, I had an excellent inside view of the working and non-workings of the Stimulus Bill (formally "American Reinvestment and Recovery Act" or ARRA). Most of the 300 programs which were stapled together to create the $787 billion federal stimulus programs failed; some succeeded; we don't know yet whether others will work or not.

My plan was to be a dollar-a-year man, but it turns out that is a violation of the Fair Labor Standards Act. Ended up getting paid minimum wage and donating it back to the State. Other bureaucratic obstacles weren't as easy to overcome.

As America struggles out of the great recession and finds its place in an irretrievably globalized world, the history of the Stimulus years is a guide to the limits of what government can do – and what government should attempt. When government overreaches, both the economy and the fabric of society suffer. USGovernmentSpending.com estimates that spending by all levels of US government in fiscal year 2010 will be almost 44% of the gross national product! Even if that percentage were to shrink back to pre-Stimulus levels, government can't help having a huge effect on the economy. It's necessary for government to behave differently in a recession than it does during a boom. Government does need to have an economic policy.

Part of the Chief Recovery Officer job was to coordinate Stimulus money awarded directly to the government of the State of Vermont, both to assure that we complied with federal regulations and that we used this one-time money in a way that makes sense. Complying with the regulations was the easy part although sometimes hilariously bureaucratic; so far so good although it still remains to see whether all the money will be spent on time. Using the money well was another story. Although Vermont did better than many other states, too much of the money ended up continuing bloated programs rather than providing a transition to a sustainable future. This was a squandered opportunity, which was only partly the fault of the federal government.

Another part of the job was to help Vermont entities win a large share of the "competitive" Stimulus money available nationally at the discretion of various federal agencies. For example, our electric utilities worked together to apply for money to build a statewide Smart Grid (see What's a Smart Grid and Why Does It Matter?). Our telcos put together excellent applications for broadband money. In the end Vermont received more competitive money per capita than any other state for both broadband and energy. Although almost none of this money has been spent yet, Vermont will probably benefit from these programs.

So it's not sour grapes that makes me doubt whether the broadband and energy programs will be helpful on a national basis – they certainly are not an example of successful counter-cyclical spending since the only money that got spent on them during the recession was for grant writing. Moreover, private investment in these areas, which might have happened even during the recession, dried up as companies waited to see if they (or the competitors) could build with government money. Government grants to business – whether part of Stimulus or not – have turned too much of the creative energy of American business from innovation to grant-grubbing and lobbying.

Another example of a competitive Stimulus program is Race to the Top; it awards grants to innovative school systems. Race to the Top requires teacher accountability for results and state support for charter schools. Again the spending won't be during the recession; but real school reform may result. Vermont didn't apply for Race to the Top funds; we failed to overcome teachers' union resistance to accountability. That's our problem, not the feds.

Since the results of the Stimulus program were a mixed bag, we can learn both from what worked and what didn't as we design American government for the 21st century. Here are the headlines of my experience as Stimulus czar, details to follow:

  1. Stimulus failed to keep the national unemployment rate below 8% as advertised. Overall Stimulus had a negligible effect on the unemployment level, although it certainly saved public sector jobs (at least temporarily) at the expense of private sector employment.
  2. Acceleration of government projects already planned – primarily road paving – did work. The price of asphalt and labor was down in the recession; the taxpayers got necessary work done more cheaply than in better times; and, presumably, government will be able to cut back rather than compete with the private sector in better times. Some people were employed who wouldn't have been otherwise, and they were doing very useful work.
  3. New infrastructure building failed – none of it was done during the recession, only a little will be done nationally in the next few years (although Vermont is an exception in the broadband and Smart Grid areas). Nothing is "shovel ready" in the United States; we've created a wall of regulatory obstacles that make it impossible to do any major project within a reasonable or even predictable period of time. Whether it's tunnels, bridges, railroads, wind turbines, or nuclear plants – we've stymied ourselves. If regulation were made reasonable and predictable, we wouldn't need government money to have a construction boom. Under the current system, not even all the King's men with all the people's money can build anything significant.
  4. Most states were desperately in need of help but didn't use it well. Programs had grown to fit not only boom-time revenue but also expectations of further boom to come. Suddenly revenues crashed and the demand for social services increased. There would have been huge pain in the states without federal help, primarily for Medicaid and education. However, the federal money came with restrictions to assure that services weren't cut. States didn't cut where they could or push back hard enough on federal restrictions. Most states (not Vermont) have now elected legislatures and governors committed to shrinking the size of state government and the dependent-rolls; the process will be much more painful than it could have been if Stimulus had been used to ease the transition instead of to prolong the overspending.
  5. An industrial policy based on government grants and tax credits is an oxymoron at best and a disaster at worst. As an example, tax credits for solar photovoltaic have stimulated the solar industry in China (they don't install solar panels there; they just sell them to us)AND Increased the cost of energy in the US.
  6. During stimulus the government share of the economy grew from 37% to 44%. In 2000, it was only 32.5%. The only time government expenditures have been this high as a percentage of gross national product was at the end of the Second World War. We can and must cut these expenditures in order to grow the economy as a whole.
  7. There are many dedicated and talented people in state government. Overstaffing reduces their effectiveness; they are repeatedly steamrollered by bureaucracy and stubbornly pop back up like cartoon characters to try to do what's right.
  8. The number of people, businesses, and non-profits dependent on government expenditures has also grown. Even with last week's election, these government dependents are a huge political force in both parties. Stimulus has made this problem worse, not better.

The good news is that Americans are building the economic base for their own recovery by reducing expenditures and credit and increasing savings. American businesses – at least some of them – have lots of cash. We can do more than recover; we can be prosperous in a more prosperous world. But we have to remember the limits to what government can do.

Related posts:

Confessions of a Stimulator – Jobs Don’t Count

How Much Stimulus Money Has Reached Vermont?

Stimulus Delayed Is Depressing

 

How Projects Get Selected for Stimulus Funding

 

The Stimulus Czar Summit – Part 2

 

The Stimulus Czar Summit – Part 1

 

Was the Economic Stimulus Bill a Good Idea?

 

 

  (first thoughts on taking the job)

 

Stromboli Volcano – A Must See

You can hear the gurgles, coughs, and explosions of the Stomboli lava tube clearing its irritable throat before you reach the southwest edge of the caldera at 3000 feet. The guided hikes, all the way from sea level, of course, are timed to put you on the ridge at dusk after a brief stop to put on dry shirts, jackets, and helmets. The eruptions are a thousand feet below you because of the collapse of the northwest wall of the crater 13,000 years ago. Stromboli is the archetype of the stombolian volcano, a tube in almost continuous small eruption

The horseshoe of fire above is a constant. Every ten to twenty minutes there are explosions like the one I did a bad job of photographing below as bubbles of gas are explosively released from solution and throw magma hundreds of feet into the air. Most come from the main vent, but occasionally a side vent flares with fire and red hot pumice. Every few years there are larger eruptions, which can throw lava bombs dangerously close to the small town on the island and create lava flows which reach the sea.

As you can see from the gps map below, the route up (about three hours) is a series of switchbacks),mostly on loose rock. We worried that we wouldn't be able to keep our footing coming down, even with our headlamps (the guide didn't speak English so we may have missed some explanations). But, when we started down after an hour on top, we went straight down in an almost rock-free cinder and ash slide; this semi-skiing technique of long steps, heal first, then a slide is easy to learn and easy to execute even on very tired legs. We were down in a little over an hour.

Where the path down went through vegetation, it had been worn shoulder-deep by walkers and water. But worrying about man-caused erosion on the cone of an active volcano is hubris.

Related posts:

Hiking Down Aetna

Blog on Vacation

Hiking Down Aetna

Click Picture for Live Google Map with Garmin Data

For two days we'd been in a hotel halfway up Etna (as it's spelled locally) waiting for the rain and snow to stop and wind to calm down so that we can go the rest of the way. Yesterday was the day. It was cold (but not by Vermont standards), and it was clear above although undercast below.

You can walk up; we didn't. We took a cable car about half way and then a bus with huge tires up a road just cleared by a snow blower to a parking lot at close to 10,000 feet. Unfortunately there'd been an "explosion" near the summit the day before so we weren't allowed to go up the final thousand feet and peer down into the crater. We took a guided walk down, which you can see in the picture above. The trail was traced by my Garmin Forerunner 305, which, unlike my droid, had no trouble figuring out where it was. If you click on the picture, you'll get a live Google map with much more data about my heart rate during the descent than you could possibly be interested in.

The loop at the top is around the rim of a recent small cinder cone, still steaming at the sunken center. The ground on the rim was warm to the touch, nice because our hands were freezing in the cold wind. Above us yellow smoke puffed from a recent vent in the crater wall. The very large crater on the right side of our path is the remnant of an earlier Etna caldera when the eruptions were just off the then east cost of Sicily.

The last 2000 feet down were a controlled slide, something like skiing without traversing, on a slope of loose cinders and ash. This must be a great ski area in the winter since the lava flows make natural trails. There are quite a few high altitude lifts.

On the way up we met Sonia and Sebastian who are bloggers (and CRM consultants) on a four month sailing adventure. Check out Sonia's Etna post on www.sailingchallenge.de for a great set of pictures and a video of the cinder ski (Mary and I are in the opening and closing frames).

My Re-Retirement

JAMES H. DOUGLAS

            GOVERNOR

 

   

State of Vermont

OFFICE OF THE GOVERNOR

For Immediate Release:

August 31, 2010

   

Contact:  David M. Coriell

(802) 828-3333

   

Chief Technology Officer Tom Evslin to Retire from State Government

   

Montpelier, Vt. – Governor Jim Douglas announced today that Chief Technology Officer Tom Evslin will retire from State Government on September 15. Evslin, 67, was recruited from retirement by Governor Douglas in March of 2009 to be Chief Recovery Officer to oversee Vermont's use of stimulus funds and applications for competitive stimulus grants. When the temporary Office of Economic Stimulus and Recovery finished its job, Evslin was named Chief Technology Officer for the State and has been the Administration's lead on Challenges for Change.

   

"I want to thank Tom for his work on behalf of Vermonters," said Governor Douglas.  "Tom's extraordinary talents were critical as we deployed hundreds of millions of dollars in federal stimulus money quickly and transparently.  His leadership and broad understanding of the telecommunications world were vital to Vermont's success in obtaining over $250 million in combined stimulus grants for smart grid and broadband expansion – ensuring the funding is in place to follow through on my eState goals of border-to-border high-speed internet access and cell phone coverage."

   

Vermont has been recognized as among the best states in deploying federal stimulus and the $250 million in broadband and the smart grid grant awards places Vermont at the top in per-capita funding in these areas. 

   

"I'm very grateful for the opportunity I had to work for Vermont as part of the Douglas Administration during these difficult times," said Evslin.  "I'm particularly proud of the tremendous creative effort that state employees at all levels made to respond to Challenges for Change and find ways to serve Vermonters more effectively with less money."

   

As the point person for Challenges for Change, Evslin has been coordinating the various efforts to save taxpayer money through increased government efficiency and outcome-based budgeting.  Governor Douglas noted that "Tom's ability to think outside-the-box and envision creative solutions to any problem has made him the ideal fit as state government has had to adjust its approach during the Great Recession."

   

Secretary of Administration Neale Lunderville also praised Evslin for his service to Vermonters.  "Tom has been an integral part of the Governor's team as we juggled the American Recovery and Reinvestment Act, Challenges for Challenges and the enduring impact of the economic downturn on state budgets and the lives of Vermonters.  Tom's work has helped to position Vermont well to rebound from the recession."   

   

Before his first retirement, Tom Evslin and his wife, Mary, founded several successful technology companies and he was one of the pioneers of VoIP technology. Evslin also wrote a novel and a popular blog and he is an inventor on eight granted US patents. In the early eighties, he served as Vermont's Secretary of Transportation under Governor Richard Snelling.  The Evslins live in Stowe. At his request, Evslin worked for minimum wage, which he then returns to the State.

   

###

Now on Kindle!

hackoff.com: An historic murder mystery set in the Internet bubble and rubble

CEO Tom Evslin's insider account of the Internet bubble and its aftermath. "This novel is a surveillance video of the seeds of the current economic collapse."

The Interpreter's Tale

Hacker Dom Montain is in Barcelona in Evslin's Kindle-edition long short story. Why? and why are the pickpockets stealing mobile phones?

Need A Kindle?

Kindle: Amazon's Wireless Reading Device

Not quite as good as a real book IMHO but a lot lighter than a trip worth of books. Also better than a cell phone for mobile web access - and that's free!

Recent Reads - Click title to order from Amazon


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