Bailouts put the US on a slippery slope
Beyond the public’s moral outrage and protests of unfairness relating to the Wall Street and Detroit bailouts, there is a systemic hazard that is very real and often overlooked in these objections. That hazard is that once the government steps away from its traditionally passive role, and steps into the role of picking and choosing which companies will be subsidized and saved, and which will not, a huge can of worms is irreversibly opened.
Historically, this was one of the biggest problems with communism– that is– governments are notoriously bad at making centralized decisions. The market is amoral– it picks winners and losers based upon events and merit. But government is biased– it picks winners and losers based upon personal biases and prejudices.
Now that our government is in the business of picking and choosing which companies succeed and which fail, there will be increasing attempts by the government to tell those companies how to run their businesses. And why shouldn’t they? Once these companies failed to survive on their own, it only seems fair that they should forfeit the right to make their own business decisions.
Yet it is this righteous position that is so dangerous and could amplify the problems we already face. Although we personally don’t think a bailout is a good idea unless the actual viability of our entire system is at-risk, if we are going to bail out these companies, we need to resist the urge to micro-manage their businesses. READ MORE
Tesla: Model S sedan will cost $50,000; 100th Roadster shipped
GreenTechMedia reports that Tesla CEO Elon Musk:
“revealed that its all-electric passenger sedan, the Model S, will be priced at $57,499. The government will offer a $7,500 tax credit to bring the price to $49,999…
“If you take into account the $10,000 to $15,000 you might spend on gas with a conventional car, the Model S drops to $34,000 to $39,000, he said. That’s around the price of a mid-range Lexus.
And on another note:
“Tesla shipped its 100th car today. It went to Sam Perry, a business consultant and former journalist. Sam became famous this year when Oprah Winfrey cried on his shoulders.”
The Obama stimulus package must effect change, not calcify the past
David Brooks touches on a concern also voiced by Tom Friedman recently, that the Obama stimulus package be used to effect positive change, and not just further entrenching our past mistakes.
The context of Brooks’ concern has to do with how our society has become sprawled-out over the past 50 years. In response to this diffusion, in recent years, new civic centers have been springing up in suburbs, creating a “new localism.” (”Restaurants and entertainment zones, mixed-use streetscape malls, suburban theater districts, farmers’ markets and concert halls.”)
In order to “build on today’s emerging patterns” towards civic centers and mixed use neighborhoods, Brooks argues that the infrastructure component of Obama’s stimulus must have two key features: READ MORE
Pickens ‘anxious’ about wind farm project
Pickens held a briefing with reporters on Monday where he discussed the status of his massive Texas Panhandle wind farm project, as well as the state of energy, in general.
Regarding the Panhandle project, Pickens said that he is “anxious” since the economic and credit crises threaten to choke off financing for the project. “Where’s the money is the question. I don’t know how we’ll do it. I’m anxious to see what Obama comes up with. There is no money to finance a wind project now,” Pickens stated.
Pickens reiterated his warning that when the economy rebounds, prices will spike again, potentially even to $100 by next year. He also said that Obama’s policies will play a key role in determining whether efforts to effect an energy transformation will occur. Specifically, extending tax credits for alternative energy and promoting natural gas usage for heavy duty vehicles will be essential.
Earlier this year, Pickens’ company Mesa Power began the first phase of the Panhandle wind farm by purchasing over 600 wind turbines. While the future of that project is somewhat up in the air, as Pickens noted, “We don’t receive turbines until late 2010, so you’ve got some time for a recovery and we’ll see where we go from there.”
Better Place welcomed by Japanese government
While Congress limps closer to bailing out the Detroit automakers, electric vehicle infrastructure company, Better Place announced on Monday that it was partnering with the Japanese Ministry of Environment on a project that would showcase EV technology in that country.
Better Place founder Shai Agassi said, “Better Place is honored to participate in this ground-breaking program in a country with so much auto-manufacturing expertise and history. We look forward to joining Subaru and other auto manufacturers in the project and demonstrating the feasibility of electric cars with swappable batteries to the rest of the industry. Japan is moving one step closer to the next-generation Car 2.0 model of electric cars fueled by renewable energy.”
This announcement comes as Congress and the White House are putting the finishing touches on a multi-billion dollar bailout of the Big Three. Interestingly, Better Place, which has been dominating the EV headlines lately with news that it is developing recharging networks in Israel, Australia, Denmark, the Bay Area, and Hawaii, has done all of this on less than $200 million, the amount of venture capital raised by founder Shai Agassi.
Could gas hit $1 a gallon? Party like it’s 1972!
With global demand continuing to decline, some energy analysts are predicting the price of oil will bottom around $25 a barrel with $1 a gallon of gas. Oil closed on Monday at $43.71 a barrel, with average gasoline prices at $1.70, the lowest since February 2004.
Oil held steady yesterday on the hopes that the Obama stimulus package could restore demand and that OPEC might bring additional production cuts. READ MORE
Gore to meet with Obama on Tuesday
Although Al Gore has made it clear that he is not interested in an Obama cabinet position, he will be meeting with the President-elect on Tuesday morning. While it doesn’t appear that Gore will be reconsidering his position, Obama has made it clear that he wants Gore to have a strong voice in shaping climate policy.
With Obama still needing to name a pick for his top energy and environmental cabinet positions, Gore could provide some valuable guidance.
Could the ‘Air Car’ be a legitimate alternative vehicle?
At first blush, the Air Car, manufactured by MDI, looks like it could be a great alternative fuel vehicle. This is because it runs on nothing more than compressed air, can travel up to 125 miles at around 70 mph, and could cost less than $5,000.
And while the Air Car may eventually prove to be a viable product, there are numerous downsides, including:
The compressed air is very cold and requires a heat exchanger to warm it up. However, even with the exchanger, in cold climates it could still freeze up;
The refueling of the compressed air container can take up to 4 hours at home. While specialized equipment at service stations could fill the tank in as little as 3 minutes, this would create extreme heat in the tank, which would have to be cooled simultaneously, similar to filling a SCUBA tank; READ MORE
Better Place unveils first charging stations in Israel
Better Place, the electric car infrastructure company led by Shai Agassi, unveiled its first live charging stations in Israel on Monday. Israel, along with Australia, Denmark, the Bay Area, and Hawaii, have all agreed partner with the company to build electric vehicle recharging and battery swap infrastructure.
Israel is the first location to get the charging spots, of which 10,000 will be installed in 2009 and 100,000 by 2010. Electric cars will be sold en masse in Israel in 2011.
Monday’s unveiling represented just a limited roll-out on a test basis.
Detroit church prays with SUVs at the alter for Congress to bailout industry
While we have a lot of sympathy for the workers and families who are struggling as a result of the Detroit automakers’ failings, this is pretty unbelievable. Apparently:
“With sport-utility vehicles at the altar and auto workers in the pews, one of Detroit’s largest churches on Sunday offered up prayers for Congress to bail out the struggling auto industry.
“Local car dealerships donated three hybrid SUVs to be displayed during the service, one from each of the Big Three. A Ford Escape, Chevy Tahoe from GM and a Chrysler Aspen were parked just in front of the choir and behind the pulpit. READ MORE
60 Minutes looks at Saudi Arabia’s oil mega-industry (Part 2)
60 Minutes looks at Saudi Arabia’s oil mega-industry (Part 1)
60 Minutes had a fascinating look at the Saudi Arabian oil mega-industry Sunday night. This clip is the first half of the program and here is the second.
One of the more interesting facts disclosed was that it costs Saudi Arabia less than $2 to manufacture a barrel of oil. However, the country relies on oil being priced at $55 to finance 75% of the domestic spending budget. Anything above that is apparently a windfall.
Detroit and America can’t go green without a focus on battery technology
With all the talk of bailing out the Detroit automakers and the need for them to make more efficient vehicles, there has been little attention paid to the actual technology that efficient cars are built upon– batteries.
EV World sums up the problem: “Little if any attention was paid to the fact that America has next to no advanced automotive lithium ion battery production capacity. With the exception of a currently shrinking handful of US-based firms, virtually all advanced nickel metal hydride (NiMH) and lithium ion (Li-ion) production is done overseas, mainly in China, Japan and Korea.” READ MORE
Is the Minnesota high speed rail proposal missing a golden opportunity?
Due to the passage of California Prop 1A and the promise of massive public works programs under an Obama stimulus package, high speed rail in the US is receiving a lot of attention lately.
So far, the high speed rail proposals we’ve looked at include California, Texas, Florida, and Illinois. Another such proposal is the Northern Lights Express, which calls for a high speed link between Minneapolis and Duluth, Minnesota.
However, upon doing a little research into this proposed system, we were surprised to find very little official online information for the proposal. In fact, the “Coming Soon” screenshot above is from the apparently official website, northernlightsexpress.org. At a time when nationwide support for high speed rail projects is growing, it seems the proponents of such a project like the Northern Lights Express should at least have a functioning website. (Unless we’re just missing the actual site.)
Obama supports massive public works program, could include $100 billion for green-collar jobs
As Tom Friedman noted on Sunday, the federal government is about to spend billions and billions of dollars trying to save and stimulate the economy– how that money is spent will determine whether we calcify the decrepit status quo, or plant the seeds for transformative change and growth.
In Obama’s weekly address on Saturday, he advocated his support for the largest public works program in more than half a century. READ MORE
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