Dana Blankenhorn

The Real 2012 Campaign

Think of this as Volume 15, Number 50 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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To hear the TV networks tell it we're about to be inundated by a flood of TV ads that will leave us sour and the country divided.

First of all, who are the “TV networks” anyway? They're the talking heads at Fox, MSNBC and CNN. How many people even watch those things? Maybe a total of 5.5 million people. How many voters are there? Turnout in 2008 was 132 million.

Oh, yes, but what about the local stations, and the “real” networks? That's where the money is going. You think people don't know where their mute buttons are? You think people are hanging on to every word of an ad for a candidate in a way they don't for one from a local car dealer?

Most people already have their minds made up. This has always been the case. John Alford of Rice, my old school, insisted to me recently that we're increasingly becoming segregated by politics, that our politics even defines who we marry, and that we may become two separate breeds of people, red and blue, over time.

Uh, no. People change as their circumstances change. Your world gets rocked in some way – you can't get a job coming out of college, you lose the career you had for 40 years – and so does your worldview. But this happens far away from the TV screens. It happens organically, inside us, as we experience life. We come out of these experiences different from the way we went into them.

What happens when our world is rocked? Where do we go? You think we go to TV? What is our medium of choice in these hard times?

The Internet.

Sun Rise Continues

As I have said before there is deliberate bearishness about solar power, much of it coming from the fossil fuel industries.

They deliberately ignore the basic economics of the trade. Install a capital good now and money comes out, day-after-day, year-after-year, literally for decades. Regardless of the current price of grid electricity you will, in time, pay for that capital good and generate a positive return. As grid prices rise, the deal gets better. As panel prices fall the deal remains just as good.

As I wrote before, Solyndra was actually a good deal. They promised costs 35% below the market. They were worth the investment. The “problem” was that costs fell a lot more than that, due to over-production in China. This created a glut that now has panels selling below their production costs.

Problem? No, opportunity.

Whip Deflation Now

The central truth of the U.S. economy this Christmas season can be summed up in one word.

Deflation.

Few Americans understand deflation because few have been alive to see it. The last such spiral came from 1929-33. This was what the Great Depression was all about.