Energy and the Next Big Economic Thing

Geoff Styles makes a common point that usually comes up when talking about the clean energy "race":

While we shouldn't be shocked if another country leads in some aspects of energy technology, we also shouldn't lose sight of the larger context, because energy isn't an end in itself. Even if clean technology turned out to be the computer industry of this decade--in reality and not just hype--and we didn't come in first in the cleantech race--a result I'm not prepared to concede, yet--energy remains the servant of the rest of the economy. That's where the race that matters most will be won or lost.

Megan McArdle says something similar when talking about green jobs. I've always been puzzled by this argument, though, which can be restated thus: Staking an economic boom on energy is misguided because our focus should be on lowering the proportion of our economy devoted to energy production, not raising it; we could, after all, solve our employment problems by putting people to work on farms, but that wouldn't be a net gain for our economy.

What's puzzling to me about this is, couldn't you say this about any sector or industry? The health care sector, for example, grew from being a trivial part of the economy to a massive part in the last century; and while getting health care costs under control is necessary, no one, I think, would deny that at least some of that past growth has been a good thing. You don't, of course, want growth in one sector to choke off others: Rather, you want all of your sectors to become more efficient. Thus, for example, farming used to take up the majority of the US economy, and now its share is very tiny. That's not because it was "choked off" by manufacturing or whatever, but because the US economy grew, developed new markets, and saw enormous productivity gains, along with the rest of what is now the developed world. Even farming has benefited from these changes: Modern farms yield far more crops than those in the 19th century, even though there were far fewer people and much more available land.

The question, then, with respect to building out green energy, is: Does making large-scale investments in renewables, efficiency, etc. entail putting people and capital to less productive uses? In other words, is the analogy between green energy and the computer industry that Styles mentions not valid? I have my doubts about that assertion: If there were another potential source of major economic growth in the offing, at least in the developed world, that would be reason to have some pause about the green economy as the next big thing. On the other hand, the last two economic booms in the US have turned out to be based on speculative bubbles; and unlike the tech boom, the last one didn't have much in the way of side benefits -- just a lot of exurban houses that no one can afford. So making energy the focus of our economic labors doesn't strike me as a bad idea. And that's not even considering the moral case for greening our energy supplies, which is the topic for another blog post.

The Strange Death of Emissions Trading

A few data points:

• The EU is kicking around the idea of a carbon tax in addition to their cap-and-trade system. An earlier version had set the tax at €10 per ton of CO2, but that was nixed; the new proposal is likely to be lower.


• The Kerry-Graham-Lieberman climate bill still isn't in writing yet, but what we do know is that there'll be some kind of cap-and-trade program for utilities, a phased-in cap for the industrial sector, and a carbon tax on transportation fuels, the latter put at the apparent request of the oil industry.


• India is looking at a tax on coal, as well as increasing duties on transportation fuels.


• Australia, like the US, has also gotten bogged down on passing a cap-and-trade bill, and Kevin Rudd's government could well switch to a carbon tax in order to win support from the Green Party, though that seems unlikely.

So does this mean that cap-and-trade is out, and carbon taxes are in? Eh, probably not. For one thing, the oil industry's interest in a carbon tax appears to be motivated mainly by a desire to demonize climate legislation; and so far, the Kerry-Graham-Lieberman team is walking right into their trap. And all the other carbon tax proposals I mentioned are speculative, to put it charitably.

But I wanted to mention them because it seems connected to the slow decline in the prospects of emissions trading, which for a long time was viewed as the linchpin to any global effort to combat the effects of global warming. Ever since Kyoto, emissions trading, whether the EU ETS or the Clean Development Mechanism or the voluntary carbon market, has given birth to a whole industry, from climate desks at major financial firms to all the measurement and verification companies you need in order to ensure that the carbon offsets you're selling or buying are leading to real emissions reductions. And now there's a good chance that the carbon market industry might go kaput, or at least become much smaller than many had hoped. A national cap-and-trade system isn't looking likely, either in the US, Japan, or Australia; the current functioning cap-and-trade systems -- the EU ETS and RGGI -- are underperforming, though part of that is due to the flagging economy; and the CDM, which has endured a multitude of scandals, could disappear after 2012 if no successor to the Kyoto Protocol emerges. Indeed, carbon traders on Wall Street are now afraid of losing their jobs.

So why is this happening? I doubt it's simply a matter of the problems with emissions trading: Yes, Wall Street's reputation is in the gutter, and emissions trading may be suffering by association; but it's hard to disaggregate cap-and-trade's problems from the sorry state of international climate policy today. Given how intractable the divisions between the developed and the developing world still are, and how feckless and schlerotic the US Congress has become with respect to the climate crisis, fixating on the technical problems of emissions trading seems inadequate, at best.

The Urban Hellhole Vision

Ed Glaeser's op-ed on the anti-urban bias in transportation policy is worth your time to read. In particular, I'd like to highlight this paragraph:

It is a mistake to think that spending on trains balances the scales. Cities will always benefit far less than exurbs from transportation because dense areas already have good means of getting around, like walking. Urban advocates would do better to either reduce highway subsidies or to balance that spending with more funding for urban schools.

This dovetails with the argument David Owen makes in his excellent book Green Metropolis: To fight climate change, or to make our economy more sustainable generally, it matters less what new inventions we come up with or whether we're "greening" our current consumption patterns, and more whether we can make cities -- dense, walkable cities in particular -- more attractive to the bulk of the population. And that means overcoming not only the policy biases against cities that Glaeser describes, but the social biases many Americans hold against cities as well. In other words, it means dispelling what Atrios would call the "urban hellhole" mythology.

It may not be so easy to break down that mythology, however. Part of it reflects our current political divides: It's no secret, for example, that the US leans Democratic in its urban centers, but Republican everywhere else:


Thus, trying to shift the balance of transportation spending from highways to transit, or from favoring suburbs to favoring cities, becomes a partisan struggle for existence; e.g., Michelle Bachmann's remarks about liberals wanting to force people into "tenements" so they can "take light rail to their government jobs."

But distaste for city living isn't a recent phenomenon, not in this country anyway. Owen describes in his book how generation after generation of Americans, from Thomas Jefferson to Henry Ford, has been drawn to the utopian "back to the land" vision of cityless living. So urbanists have a lot to go up against. A good place to start would be showing that raising kids without a car is not only possible, but desirable as well.

Image credit: Wikimedia Commons

The Magical World of the iPad

You know what the iPad reminds me of? There was a feature on older Macs, circa System 7, that restricted users to a simple panel of applications and files, preventing them from getting into the guts of the software. (It was used primarily in schools and for "kid-friendly" home computers.) The iPhone, and now the iPad, seem to be run according to the same principle.

Not that that's a bad thing: The iPhone and, by all accounts, the iPad are beautifully designed and capable of making everything from video to web browsing to reading e-books a blast. No one should expect anything less of Apple, after all. But I think a lot of the anxiety you hear in those criticizing the iPad (e.g., Mark Pilgrim) comes from a fear that Apple is leading the charge toward the infantilization of the average computer user: The iPad, among other sins, is locked down and restricts the users from adding any applications that don't have Apple's approval; nor can you access the core functions of the iPad via the command line, as you can on OS X.

But how different is this, really, from the situation for the average computer user today? From the beginning, Apple has been all about making computers and devices "for the rest of us," and the progress of computer technology over the last 30 years has been in line with that mission -- hiding the complicated and just giving us the simple. And it's been wildly successful: Whether you use a Mac, Windows, or Linux machine, a GUI is now the standard manner of interacting with a computer; moreover, most people, I'd wager, only use a few applications, mostly pre-installed, in their daily use. To be sure, Apple is being overprotective in embracing, for the iPad, the walled garden model that it has used for the iPhone. But fears that the iPad's arrival spells the end of the culture of hackers seems, at this point, overblown. Hackers and tinkers are already a minority among computer users, anyway, and I doubt the iPad will exacerbate that dynamic.

On the other hand, the folks defending tinkering aren't wrong, in the general sense that it's somewhat disturbing that so many people in our society are using devices that they neither understand nor care to understand. We're all guilty of this, in one way or another: John Gruber's comparison of the iPad to the automatic transmission may well be correct. Not knowing the intricacies of a modern car doesn't impair one's ability to function in society, any more than not hunting for or growing one's food does. But simply being aware that the things one considers conveniences are in fact the products of generations of effort, ingenuity, and expertise is, I think, salutary. At the very least, it helps one avoid the mindset of passive consumption that modern society can fall prey to. Clarke might have been right that a sufficiently advanced technology is no different than magic, but that doesn't mean it's a good thing to accept that as inevitable.

If You Don’t Slow Down, What’s the Point of Winning

Elizabeth & the Catapult: "Taller Children"



Discovered via thesixtyone, possibly the best music site to appear since Pandora.

So Much for Question Time

Lots of bloggers are cheering President Obama's impromptu debate with House Republicans in Baltimore today: Besides the thrill of seeing Obama parrying the usual GOP attacks with aplomb, the whole exchange was reminiscent of the highly entertaining Prime Minister's Questions in the UK. But it looks like that won't happening again, as the GOP is now regretting having cameras at the meeting. Even if they did allow cameras in the future, though, I doubt that the sort of unscripted debate we saw today could survive in the American media landscape. The cable news networks seem to like reducing debate to dueling talking points, and pundits and politicians for the most part oblige. And while Obama dove into the debate with enthusiasm, too many politicians, Democratic and Republican, aren't well-prepared to do what he did: It's not merely about intelligence or rhetorical skills, but about refusing to reduce things to sound bites and talking points. There's a reason most Presidential debates, for example, feel more like a press conference than an actual contest of ideas.

Friday Video

La Roux: "Bulletproof"



For comparison's sake, here's the new Tron trailer: