Archive for January 23rd, 2008


Capitalism’s worst enemy

Amid the mayhem on world financial markets, it is becoming clear that capitalism’s most dangerous enemies are capitalists. No one can have watched the “subprime mortgage” debacle without noticing the absurd contrast between the magnitude of the failure and the lavish rewards heaped on those who presided over it.

Contrast this to Commodore Vanderbilt who built a huge fleet of steamships and railroads in the 19th century. While other steamship owners paid huge amounts for insurance, Vanderbilt never had insurance and never lost a ship. Why? Because he paid employees well, treated them fairly, and kept his fleet in top condition. He was known for keeping prices low, and when he achieved a monopoly in railroads he, are you ready for this, lowered prices (which of course led to increased sales and greater profits.)

How unlike too many greedy, grasping CEOs of today.

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Why greed is not good

While corporate earnings rose as much as 40% per year, wage increases for working Americans came to a pittance. Businesses “did not share” and this is a monumental mistake that corporate America is going to regret for decades to come.

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Geothermal power. Iceland

Nesjavellir Geothermal Power Plant. iceland

Iceland heats 90% of their homes with geothermal energy. 80% of their power comes from hydro with the remainder from geothermal. It’s so cheap that they heat sidewalks in winter with it. While geothermal isn’t completely renewable, it is certainly mostly so, which makes Iceland probably unique in that virtually all its power and heating is from renewable, clean resources. And it’s cheap!

More. National Energy Authority of Iceland. Wikipedia.

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Break Through: From the Death of Environmentalism to the Politics of Possibility

Break Through. by Michael Shellenberger, Ted Nordhaus

Break Through: From the Death of Environmentalism to the Politics of Possibility. By Michael Shellenberger and Ted Nordhaus

We need new ways to deal with global warming. Gloomy prognostications about the future by environmentalists drives people away rather than having the intended consequence of attracting them. Simply presenting people with facts about global warming can not and will not engage them. We need to attract them, to make it fun, something they want to do.

Environmentalists constantly preach shortage and restrictions. We need to cut back. Restrict usage, or maybe tax it out of existence. Comfortable lifestyle? Forget about it. Scale back now. With or without this doing penance for our sins. But such an approach has two major problems. 1) It doesn’t attract people, certainly not in the numbers needed for real change. 2) It directly interferes with the goals of the Third World to lift themselves out of poverty, to have more comfortable lives for themselves. They quite rightly think it massively hypocritical of the West to tell them they can’t industrialize when the West itself is both comfortable and a primary emitter of carbon.

Break Through proposes the heretical idea that only those who are already comfortable have the time and resources to work on the environment and global warming. Thus, we need to raise the lifestyles of those in the Third World and make them more prosperous. Then they too can and will work on global warming. It’s amazing how not starving frees you to do other things.

How do we do this? The authors say by focusing on precisely that which many environmentalists mistrust - business and commerce. The federal government primes the pump with hundreds of billions of dollars of investments into clean tech, renewable energy, and energy conservation. Private enterprise does the same (and in fact already is doing this.) The result will be major energy breakthroughs that will create new industries as well as enormous numbers of new jobs - and slow carbon emissions too. If China and India have clean ways to produce energy that is cheaper than coal, then they won’t need to use coal. Their lifestyle improves AND the planet gets a break.

This is the time to think big. Forget tiny incremental goals. We need a new energy infrastructure, and this can be created, at least in the beginning, in the exact way the Internet was, by massive governmental funding. No one could have predicted that Arpanet would have morphed into the Internet, which in turn changed the world of business forever as well as creating millions of new jobs.

Let’s do the same thing with energy - that is the message of Break Through.

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