Dana Blankenhorn

The 1898 Game

Think of this as Volume 13, Number 7 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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The cycles of American history are important because they can show us where we are, and let us know that our reactions to events are not as unique as they appear.

Our history has been marked, so far, by six generational crises from which we managed to escape, and which defined all who went through them:

1. The 1800 Crisis, about the limits of our democracy and adherence to those limits.
2. The 1828 Crisis, a new balance between sections and the myth of "the people."
3. The 1860 Crisis, about Union, slavery, and the nature of our economy.
4. The 1896 Crisis, about balancing power between business and government.
5. The 1932 Crisis, about rescuing the economy and unity.
6. The 1968 Crisis, about culture, global war, and values.

The 2008 Crisis has much in common with the 1896 and 1932 crises, in that our problems are primarily economic. But it also has much in common with 1860 and 1968, in that our people seem culturally divided. (History is viewed like a picture on Google Earth -- everything below appears compressed and one-dimensional.)

There should no longer be doubt that 2008 was important, in the same way that our other crisis years were important. The assumptions of the past era had collapsed, our problems seemed ready to bury us, and we were ready to hear a new story about ourselves.

But we are now two years past that crisis. We have reached its center, its core. We are in the middle of cultural, economic and literal war, a time that tries mens' souls and has people wondering aloud whether this path is, indeed the right one.

Now is the time for heroes.

The Economic Recovery Act

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Think of this as Volume 12, Number 26 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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The so-called "cap and trade" legislation being voted on today by the U.S. House has been horribly mis-labeled.

Its name should be The Economic Recovery Act.

While every action of this Administration and Congress up until now has aimed to stanch some type of bleeding or cauterize some economic wound, this bill is meant to define and launch a new economy that can grow and restore American leadership.

The bill is hardly perfect, but it's not meant to be at this point. It's meant to pass. It's meant to act as a marker against which a future Senate bill might be measured. The final policy will mix what the House passes, what the Senate passes, and how the Administration interprets the law in implementing it.

The War Against Oil is a War for the Economy

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Think of this as Volume 12, Number 20 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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Want to get the economy out of the ditch? 

Make something. Make something new, something valuable, something real, something with a ready market. 

Despite what critics felt there was something real about the Internet, which defined the 1990s. The Internet accelerates the transfer of knowledge, and of any knowledge-based value store. It's the most powerful economic accelerant since the creation of the telegraph.

By contrast there was nothing ever real about the economic drivers of this decade, financial services and homes. Not that homes aren't real. But the value of a home has nothing to do with its cost or even its location. It is a measure of the economic value left out there to buy homes. A home sucks money, it only creates money for those who build, assuming someone buys. Thus homes became a natural sinkhole for the confederate money of this decade, soaking up as much as the banksters could create from thin air.

Now that the economy has stopped falling this question becomes vital. On what will we base the next boom? 

The answer is obvious. Energy. 

Oil Fights Back

Those engaged in the War Against Oil must not underestimate the potential of oil to muddy the waters.

Their chief weapon is to question the premise of that war, namely global warming.

Doubt is their ally, because doubt prevents  action. To that end any scientist who questions global warming is being trotted out. These range from industry shills to thoughtful men like Freeman Dyson, who realize science offers nothing like an "airtight" case. 

All this is driven by right-wing "think tanks" like the Cato Institute and Heartland Institute, whose thoughts always lean to the golden rule -- he who has the gold makes the rules. But what many liberal bloggers don't understand is that, while orders come from the top and people follow with a devotion that would make Mao proud, their belief in this ideology is real.

Look carefully at the conservative comments under this New York Times blog post on Michele Bachmann, a "hatie" from Minnesota whose attitude towards Obama is identical with that of Jerry Rubin's 1969 attitude toward Nixon:

• What reasonable people take issue with is that the cause for climate change is somehow related to human activity.
  
• Conservatives are not invested in denying climate change - they are invested in denying man-made climate change which is a myth ginned up by liberal kooks pusing their agenda.
• The right doesn’t want to have more of our money confiscated, just to further motivate scientists and researchers and businessmen to invent a competitive solution (that currently doesn’t exist), to a problem that might not even be real.
• I believe that the earth may be warming slightly, but I am not convinced that anything that man does will alter this shift one way of the other.
  

This "belief" makes it possible to claim that public commitment to a War Against Oil is fleeting, that green energy is an economic sinkhole, and that rolling back fossil fuel use is a money-loser.

A Good Start in The War Against Oil But Just a Start

The President's Stimulus bill, just signed , makes a very good start toward fighting the War Against Oil. (Picture from Whitehouse.gov.)

But oil is a pernicious foe. Even now its advocates are taking advantage of some parts of the stim, and condemning the necessary next steps, in order to keep Americans enslaved to the oil power.

Let's start with the good news. Nearly 10% of this money is going into the low-hanging fruit of conservation and research:

1. Almost $11 billion will go into making government buildings more efficient.
2. Almost $10.5 billion will go into improving the efficiency of housing used by poor people, who are least likely to make the investment on their own.
3. About $16.4 billion is going into "supertrains" of one sort or another, either local transit or inter-city links. Trains are 10-20 times more efficient at moving people than cars.
4. There is $11 billion here for "smart grid" technology, which could allow utilities to buy as well as sell power.
5. There's $7.5 billion for building renewable power sources and transmission lines to get them to market.

There's some potential waste here, and a lot will depend on how well Dr. Stephen Chu and the Department of Energy do their work doling out the money.

• Some think of the "smart grid" only in terms of time-shifting power demand and getting more money from each kilowatt they sell, not enabling the purchase of power from urban solar farms or suburban windmill owners.
• Boone Pickens could easily grab that $7.5 billion to force construction of low-efficiency power lines from his West Texas windfarms to Dallas-Ft. Worth.

There's a big bet being placed here, namely that government can do things right. Republicans love condemning government and praising the free market, but it was the privatization of government and rejection of regulation that got us into this mess.

Now, for a warning and what comes next.

War Against Oil Still Being Fought

If you turn on the TV or listen to the mainstream media these days you would think that the War Against Oil was a one-time boom that is now going bust.

All eyes are said to be on the stimulus package, looking for cash to invest. Supposedly. Meanwhile our enemies in this war, like Venezuela's Hugo Chavez, are laughing themselves silly. America needs oil "like air, like oxygen to live, to survive.” You can almost hear the Bond villain laughter.

But this is not the reality. America is already the world's largest producer of wind energy, and will soon be number one in solar as well. Investors in the space remain optimistic. Some communities are starting to pay people who produce energy at their homes or offices.

It's true that the enemy is powerful, but its power is diminishing. The fact that oil prices are holding near the $50 level is good news. Everyone now knows that oil remains a permanent check on economic growth -- that as growth returns oil prices will go up and take away any gains. This is leading to a growing determination, especially in this country, to rid ourselves of this dependence once and for all.

The best way to guarantee continued success is by changing the business model. A carbon tax would do that. In the short run it would work better than a price floor -- if all industrialized countries adopt it. That's a danger for both proposals, and it's the main reason this Congress is unlikely to adopt it. (Instead we'll go with cap-and-trade, which is a short-term fix.)

The Real Benefits of a Hydrogen Economy

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Think of this as Volume 12, Number 4 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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So far we've been selling the idea of a hydrogen cycle (instead of a carbon cycle) as nationalism, as environmentalism, or as a way to make our electrical grid more flexible and robust.

But there is another, even more important argument for the hydrogen economy.

Water.

For thousands of years the history of civilization has been a history of water. Water defines civilization. It can't exist without water.

Read Rushdie's The Enchantress of Florence, or watch Michael Wood's The Story of India, and you learn how central Asia, what's now the deserts of Afghanistan, Turkmenistan, and the "tribal areas" of Pakistan, are the real cradles of civilization.  Those civilizations were destroyed as water sources dried up. That's why the Ganges means life.

To give life water must be clean, and the most important technologies of our last century are those devoting to maintaining supplies of clean water. Water purification, water desalinization, these are the most expensive projects we have. And their reach is very limited. Man can't magically create water. He can only preserve, transport, and purify what he has available around him.

Until now.

The Moment of Greatest Opportunity

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Think of this as Volume 12, Number 3 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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Hard as it is for you to believe moments like this, when times are darkest, are those offering the greatest opportunity.

1. Everything we value in California grew up during the Great Depression -- its farm belt, its media, avionics and technology all date from the 1930s. Even Las Vegas.
2. Apple and Microsoft grew up alongside the recession of the early 1980s.
3. Google emerged from the dot-bomb at the start of this decade.

What can we learn from successes like these? The people behind them were passionate first about the product, then about the customer experience, and only later about the money. None of their creators listened to the pundits of their time. They focused on doing something they felt needed doing for its own sake.

We know what our country needs. What's lacking is the imagination and drive to make it happen. Or what seems to be lacking -- I have no doubt that there are people, right now, out of sight of both this blog and the TV cameras -- working on solutions.

You should be one of them.

So let's look at some of our most intractable problems, and then you look for ways to solve them:

Addressing the Crisis

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Think of this as Volume 12, Number 1 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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Despite all the problems of the world, there is a feeling of confidence in America. (Picture from UC Santa Cruz. Go Banana Slugs.)

The Crisis which has been building for a generation, and which has become obvious over the last four years, is finally going to be addressed.

But before we get to work there is something important which bears constant repeating.

It's going to be hard. At times, the task before us will seem impossible. We will be told it's impossible, by many people, we will be told to turn back, to turn away. And we will want to, very much.

Don't expect wisdom out of the opposition or the press corps. The first group got us into this mess and still refuses to own it. The second enabled this mess and still refuses to own that. To a large degree we will be on our own.

Our leaders will come to seem distant, no matter how hard they work to avoid it. The daily grind will consume them, and the minutiae will threaten to consume us as well.

The only hope is to keep our eyes on the prize.

A world without oil.

Really Big Chu

Sorry for the pun, but the appointment of Dr. Stephen Chu as Secretary of Energy will be big news in the War Against Oil.

No agency in government is so controlled by the industry it supposedly regulates as the Energy Department. The place is just crawling with oil company executives.  Many will be blown out in the transition, but that still leaves the "protected" employees, civil servants who are right now "burrowing" into the bureaucracy specifically to thwart change.

Thus it's important to have people alongside Dr. Chu who know how the game is played. And this is the beautiful thing. The Lawrence Berkeley Lab Dr. Chu now runs is a Department of Energy agency. Chu, unlike anyone else Obama could have chosen, is already an insider.

Best of all is the gravitas thing. I can't remember ever seeing a Nobel Laureate in the Cabinet. (Can you?) Having won the 1997 Nobel Prize in Physics, Dr. Chu brings credibility to his task no other possible appointment could match.

There is much to do.