Dana Blankenhorn

Nixon and O.J.

Think of this as Volume 16, Number 7 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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They framed a guilty man.

That's what was famously said of O.J. Simpson after his acquittal (he eventually became violent again and is now in jail in Nevada). It meant they went so far in trying to convict a man they knew was guilty that they gave his friends a way to claim he wasn't.

The same may have been true of Richard Nixon.

Nixon was guilty. Yes, he became an enemy of democracy. Yes, he set up the plumbers and all the rest of it. Yes, he tried to cover up Watergate.

But in their zeal to convict him, humiliate him, throw him in jail, Americans also went too far. They mistakenly conflated what he believed with who he was. When Nixon came down, liberals thought his politics came down with him. They didn't. And, after Carter, liberals spent a generation in the desert paying for that mistaken assumption.

Validation

Think of this as Volume 16, Number 6 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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The hardest period for a new political thesis is the time of validation.

Getting into power is exciting. Staying in power is harder.

When a set of political assumptions are new, a new Thesis has to compromise on principles, to the annoyance of the base. These compromises don't bring the other side closer – they push it away. This bit of sketch comedy from Monty Python sums it up:

First Man: (holding up a newspaper) You see this? Nixon's had an asshole transplant!

Second Man: Did you see the stop press, there? The asshole's rejected him!

In the face of this scorn Nixon became just what his enemies perceived him to be, a megalomaniac, an enemy of democracy – small d. Watergate destroyed the man but (and this is the important part) it didn't destroy his ideas. It didn't change his party's strategy. Democrats mistook the rejection of Nixon, and Ford's pardon of him, for a mandate. Rather than leaning into the conservative wind, as he had done in Georgia, Jimmy Carter let his liberal sails out, and his party was grounded on the Reagan era's rocks.

The Real China vs. U.S. War in Solar is Technology, not Price

The U.S. complaint about Chinese “dumping” of polysilicon solar panels is a sideshow to the real battle, over which technology will dominate the next generation of solar panels.

GTM Research indicates polysilicon costs could drop this year to 70 cents per watt, although producers are doing all they can to dampen that speculation.

The action is in new technologies that will drop costs far below that level on CIGS and thin films of all kinds.

REC Group of Norway, an integrated maker of polysilicon-based panels, says their Peak Energy series can deliver a return on investment in just 12 months with the highest performance in the industry.

Meanwhile gallium-arsenide cell producer Semprius, based on North Carolina, says its print-transfer technology has produced a module with an efficiency of 33.9% – nearly three times what current cells produce. Scaling that up, raising yields and dropping production costs, could have a profound impact on the market. (Siemens has a 16% stake in Semprius.)

It's not just higher performance, but lower cost achieved through production efficiency that is driving these markets forward. This means leadership in the space remains highly fluid.

And to this has to be added improvements in inverter technology, which can cut costs by increasing the amount of DC power produced by a cell that goes onto the AC grid, to system manufacturing costs, to channel costs, and to reductions in the cost of getting installations approved by government at all levels.

As I have said before these are early days in the solar industry. This is going to become the cheap energy no matter how much we drill baby drill. The only real question is whether America can capitalize on its advantages in research and capital delivery, not whether China plays “fair.”

 

 

Oil From Tires, Gold From Straw

I don't care much for penny stocks. But I have a problem, and if someone can solve it I won't begrudge where they come from.

These guys, who call themselves Green Envirotech Holdings, claim they can solve a big problem in my neighborhood.

Tires.

Every spring my neighbors and I go out hunting for old tires, and every year we find tons of them. Along the road, under viaducts, down in creek bottoms. Tires thrown around by guys who are selling tires to poor people and don't care for the expense of recycling them because they're poor themselves.

If you could turn tires into money, if the tires had value, then people wouldn't be going around stealing copper, they'd be grabbing these tires and making a semi-honest living.

Internet Made Me a Video Star

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A few weeks ago I was contacted by Curtis Hollister of Investor Candy (the fellow on the left above.)

Curtis had seen my work at Seeking Alpha and was launching a video service for investors. Would I be interested in helping out?

Before I knew it, I'd turned the back bedroom into a rudimentary studio, complete with a green screen I hung over a bed and a fancy video camera Curtis sent me. He asked me to look into First Solar, which I did, then scheduled a GotoMeeting call.

The result is what you see above. He sat in his office and asked questions. I sat in my office and answered them. Same thing I've done for decades, only in reverse. He used a little technical magic to transform my bedroom into the Atlanta skyline and voila.

Let me know what y'all think. Has the Internet made me a video star or should I stick to my typing?

What Tebowism Really Tells Us

Think of this as Volume 16, Number 2 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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It's one of the ironies of our political cycles that a decisive turn is often followed by the other side's capture of the culture.

Think about it.

1. The South and the “Lost Cause” were culturally ascendant after the Civil War, even as the grave closed over the Confederacy.

2. Populist-fueled racism became a popular cultural expression after progressives captured the flag in the 1890s. See “The Birth of a Nation” for a fine example from that era.

3. The 1930s and 1940s saw a very conservative culture, which you can see in the movies of that era. I might point specifically to the Andy Hardy-Judy Garland movies for its truest expression.

4. The 1960s were all about the rise of Leftist culture. Funny how the sideburns suddenly start growing across the establishment after Nixon won in 1972.

Today I see another turn happening all around me. My kids are a lot more like those of the 1930s than they're like me. Even the “Occupy Wall Street” movement was well-behaved. It was the police over-reaction to peaceful protest that said otherwise. And did you notice the lack of reaction to that over-reaction? In a cultural sense, we're very respectful of authority these days.

So the best sign of the left's rising to a semi-permanent state of power in America is probably the rise of Tim Tebow.

Tebow is the ultimate expression of muscular Christianity. He is a man who lives his values, and they're values that even Rick Santorum would approve of. He defies our expectations in a throwback sort of way, a run-first quarterback throwing himself into the line. Sort of like a Republican Muhammad Ali, and I'm very afraid he may wind up the same way, a victim of repeated head trauma, old before his time.

I'm seeing similar expressions across the culture. What are the biggest movie hits of the last few years? Why, it's the “Twilight” franchise, in which a young girl swoons before a strong, masculine presence. Our most popular musicians, like Jay Z and Bruno Mars, are self-consciously consumer products, careerist, careful in how they live, careful with their money.

What I find most fascinating about the Tea Party is not how reactionary it's been, but how ineffective. The Congress and governors elected by that movement in 2010 are now almost universally mocked, much as hippies were derided 40 years ago. We don't need Spiro Agnew, they write their own lines. Here's one – will someone get this guy a joint and a paisley flag, please?

It makes sense. Culture tends to act best in opposition. If we don't have anything to be angry about, we really do stagnate.

England's Austerity Fairy

While my ancestors came here from Germany, Ireland, Poland and Scotland, I have always had a soft spot for England. (It's the language.) I have English friends, I watch English sports, and I even speak English at home.

For England, the war in Iraq has been more like the Vietnam era was for us. It politically discredited the left, which was blamed for getting England in, and brought forth a Nixon-like figure to leadership in the form of David Cameron.

Cameron, like conservatives everywhere these days, whether on Wall Street or Main Street, believes in the magic Austerity Fairy. He's what I call a Mellon-ista. Liquidate everyone (except the bankers) and growth will return by magic.

There is no Austerity Fairy. Market failures like the one just passed make money disappear. What was lost by the longs is not fully gained by the shorts. There is less money around. Less value in homes, less value in stocks. Waiting for the Austerity Fairy while the clock ticks on loans is a recipe for poverty, not prosperity.

The Next Revolution

Think of this as Volume 16, Number 1 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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It may seem strange, at a time of chronically high unemployment, for me to write about a coming labor shortage.

But that's how I roll. I see around the next corner, or try to. Sometimes, as in the late 1990s, this can leave me depressed in a happy time. Sometimes, as in my posts this last year, it leaves me happy in a time of depression.

What I've seen over the last year, however, makes me confident that labor shortages are indeed in our future. Even if the scare-mongers are right and “peak oil” is just around the corner, I'm now convinced that's more of an economic event than a real one. The amount of new energy being created through efficiency, as well as through renewable technologies like solar, wind, tidal, geothermal and biofuel power, is going to be enough to see us through.

The benefits of this are many-fold. First, there's the economic benefit of having a thum b down on energy prices, a thumb that's only going to grow in strength as the cost of producing solar power (to take one example) falls below that of oil, then natural gas, then coal, over the next few years. There's the environmental benefit, the start of replacing our current carbon economy with one based on hydrogen. There's the social benefit, in which wars over resources are no longer necessary, because the Sun shines everywhere, and the winds blow, the tides roll, and we live on a molten rock.

Of course, these power sources have different sets of economics. For one thing, they create more jobs than what came before. Once you have an oil well drilled, once you have a field in production, the incremental labor required to keep the fuel flowing isn't great. The same is true for a solar panel. But solar panels are tiny units of power. They must be researched, they must be manufactured, they must be tested and they must be installed to deliver an economic impact.

This takes people.

So, as my late journalism professor Elizabeth Yamashita told me, back in 1978, when we sat down to our first business journalism class at Northwestern University's Medill School, I have good news for you. You're all going to have jobs.

There will not only be a lot of jobs in the new energy sector, but there will be new wealth, that must be spent on something. And those somethings will include lots of new jobs in every area of endeavor. So even if you're into video games or studies of urban predation, this applies to you. There will be money to hire you.

But there's another important trend. I, and my lovely wife, and the rest of the baby boom, and everyone in the western world is getting older. I turn 57 next week. There are days, even now, when I feel, like Bilbo Baggins, “thin, like butter spread over too much bread.” Friends are retiring now, and when I look in my loved one's eyes I see someone looking forward to a restful time, a time to read and relax and let the world drift by.

My generation will soon need to be cared for. And there won't be enough people to do the job. The immigration debate is going to shift a decade from now, and we'll be worrying about how we can attract people, not repel them.

Still, this is a tech column, and all this discussion really leads to a single, one-word description of our future, which I hope gives hope, but (as usual) also brings challenges.

Robotics.

Crossover is a Moving Target

One of my big predictions is that “crossover,” the point at which solar energy becomes the cheap energy, will be achieved around 2016.

What I may have failed to mention is that's a moving target, not so much in time as in place.

There are multiple variables, and not all are within the industry's control. Yield, production cost, installation cost and channel cost can be controlled, but many other factors can't be:

• Expected production will vary depending on where a panel is placed, on the intensity and regularity of heat and light striking it.

• The value of that production will depend on the cost of local grid energy, on the price of the alternative.

• The value of that production will depend, in part, on the local grid itself. How far away are the customers, how efficient is the grid at handling inflows. Is there a grid?

• Government policies can impact value in two ways. Subsidies like feed-in tariffs can improve the outlook, taxes can reduce it. In the U.S. this means the environment can vary from state to state and town to town.

(Image from Lux Research.)

2012: The Landslide

Think of this as Volume 15, Number 52 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

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The future is hard to know, but in this case it's easy to guess.

There is a Democratic landslide in our future.

No one in the media wants to admit this, but it's baked in.

Once Americans take a decisive turn, and we've only taken six in our whole history as a nation before now, we don't reverse course.

We validate that turn, moving closer to our historic balance of rights and responsibilities, between money and power, between rich and poor, among one another.