Dana Blankenhorn

The 1979 Game

When you win the popular vote by 9.5% but still lose ground, as Democrats did November 6, your problems are systemic.

The result underlies tech’s obligation to come out of its shell and fight for the political system that birthed it.

Tech moguls have done some things. Jeff Bezos bought The Washington Post, Marc Benioff bought Time Magazine, Laurene Powell Jobs bought The Atlantic. The key to gaining more power will be in creating journalism business models beholden to tech interests.

Tech must do to Bizarro Carter what oil did to Jimmy Carter, and for the same reason -- to protect its self-interest.

Peak Carter, Peak Trump

One thing that has surprised me over the last two years is how almost no one understood my point right after the 2016 election, that Donald Trump is a sort of Bizarro Carter. 

By that I meant he is completely the opposite of Jimmy Carter. Carter was a Democrat. Trump is an Autocrat. Carter believed in human rights. Trump believes in the divine right of kings. Carter championed the environment. Trump trashes it. Carter said he’d never lie to us. Trump lies 6 times before breakfast.

What they have in common is they represent the end times for the Political Thesis that birthed them. Carter was elected 44 years after Franklin Roosevelt and was the last President to run on those principles. Trump came 48 years after Nixon and will be the last President elected under the Nixon Thesis of Conflict. 

Another View of the Carter Administration

It has been clear to me for years that the 2010s are, in many ways, a bizarre recapitulation of the 1970s.

I just didn’t know how much.

While the 1970s represented the rise of oil, the 2010s represent its twilight.

The 70s were marked by two key crises, in 1973 and 1979, during which supplies were cut and prices skyrocketed.

The 2010s have already seen one price collapse, in 2014. It is going to see another before the decade is out.

It is against this backdrop that I would like to revisit the administration of Jimmy Carter. This time, especially if you’re a liberal, try to imagine yourself in opposition.

This isn’t difficult for me, because I began the 1970s as a genuine conservative activist. My politics shifted left, slowly, during the decade, but I still voted for Gerald Ford in 1976, and still refused to support Carter in 1980. (Sorry, Jimmy.)

What conservatives saw during that decade was just what liberals see today, in reverse. In the 1970s conservatives saw a natural majority growing, with power tantalizingly out of reach. Democrats in 1977 held all branches of government, as Republicans do now, and were very optimistic about putting their program into motion.

Where Tesla is Wrong

Let’s step away from politics for a week, maybe a year.

Let’s talk, again, about business, about technology and about the future.

Let’s talk about Tesla.

I like Tesla. Most business analysts don’t. But I admire Elon Musk. I even think he’s right to buy SolarCity.

But I think the namesake product has a limited runway. Here is why.

The story of the Tesla car is a three-legged stool.

• There’s the electric angle. Don’t just save the planet, but recycle energy from the Sun, through the battery. Just as important, deliver a car with far fewer moving parts, so it won’t wear out. An electric motor has very few moving parts. A Tesla car is basically a drivetrain. If you replace the batteries, keep the drivetrain maintained, and change things like tires and wiper blades you’re good.
• There’s the performance angle. The Tesla’s electric motor can deliver enormous power to the drivetrain quickly. Its “ludicrous speed” goes from zero to 60 in nothing flat. The sleek design screams sports car. This is a car that has always been compared to high-end luxury vehicles, or sport vehicles, and has won in that niche. It’s had to compete there to justify its price.
• There’s the self-driving angle. Musk promises that you can ignore the car in a few years, and for now just keep an eye on it as you go down the road under the control of your GPS. It will avoid collisions and go where you want it to go.

Solving The Problem of Abundance

Everyone is vulnerable to fighting the last war, and ignoring the conditions of this one.

For investors and policymakers, the great fears remain the currency and the money supply. I read it in every Seeking Alpha discussion thread, a pervasive fear that we’re about to be crushed because no one is going to believe the promises of the dollar, or that we’re running out of something essential whose lack is going to make our dollars worthless.

What this decade has shown, already, just halfway through it, is that those fears are baseless. The problems of scarcity have been replaced by the problems of abundance. There’s too much oil, too many commodities, too many cheaply manufactured goods on the market. There are too many devices, there is too much cloud, there are too many good movies and shows out there and not enough time to see them all.

Winning the Oil War

Vietnam was said to be “a Cold War activity,” part of a larger struggle for global supremacy between the U.S. and the late Soviet Union.

The description overlooked millions of deaths, and immense human suffering, dismissing it as a byproduct of something larger, a proxy war. Veterans of the conflict remain insulted by the characterization, but in historical terms it was accurate.

History will record Syria, then, as an “oil war activity,” just as 9-11 was an “oil war activity.” It is part of a larger struggle for global supremacy among the producers of oil and gas. The tragedy is that it’s not recognized as one.

Understanding that Syria is just one piece of a larger struggle, and understanding what that struggle is really all about, would give us a chance to win that struggle, but so far no one in power, not even President Obama, has made that connection publicly, and with sufficient urgency.

The 1940 Game

What would Democrats have done in 1940 had FDR been term-limited?

Every generation of American politics has some things in common with generations that came before. But the period that comes to mind now is that which came after the Crisis of 1932, which evolved into World War II.

As was the case then, the economic crisis and previous military conflict brought with it blowback. It created enemies who threatened the very foundations of the Republic. The difference is that while FDR faced a consensus against military conflict he had to reverse, this President faces a consensus in favor of military conflict that must be reversed.

As was the case in FDR’s time, when those against his Thesis of Unity misread the past, trying to make history repeat when the opposite tack was called for, so the case against Obama’s Thesis of Consensus is based on a misreading of history.

Back then, of course, Republicans were isolationist. Many even found Mr. Hitler compelling. These people did not want America re-arming, and their control of Congress made it difficult for Roosevelt to coax the build-up of fear and passion necessary to face the challenge.

National Security and the War Against Oil

The attacks in Paris are a reminder that, 82 years after Texas aligned America with the Saudis’ Arabia, trading technology for oil, things are getting no better.

It’s a chain of mutual dependence. They have oil. We need oil. They sell oil to buy guns. We make guns to buy oil.

It no longer has to be this way.

In just the last five years, the cost of renewables has become cost-competitive with that of grid energy. Warren Buffett buys solar power plants to assure Berkshire-Hathaway with regular electricity supplies. 

At peak times Texas gets 30% of its electricity from wind. Once, due to the peculiarities of its regulatory system, wind suppliers were actually paying customers to take that electricity, it was so plentiful. 

The 1939 Game

We are now 7 years removed from the Great Crisis that brought us Barack Obama. (We are also no further removed in time from the movie poster at the right was from the end of the war it portrayed.) 

For those keeping score at home, that means we are now playing the 1939 game, as that year provides the best analogy to our time.

In 1939, the world was slouching toward war. The West had returned to the austerity policies, negative growth and deflation of the crisis because bankers were back to making policy, and bankers don’t understand that money is a verb.

The bad guys of the time got this. Hitler ignored the bankers and re-armed his country. So did Japan. So did Italy. They demanded that money be spent, they directed it be spent on arms, and in the course of spending that money the economies of the Fascists grew rapidly.

In our time, bankers have far more control of the world than they did then, so austerity and deflation are more widespread. Austerity rules Europe, it dominates the U.S., and it’s becoming increasingly popular in China.

Only Vladimir Putin is prepared to ignore this reality and put money to work. He has sunk his currency, sunk his economy, but he has spent, believing that aggressive wars to win territory can succeed.

Reversing the Energy Decade

This is Volume 18, Number 50 of the newsletter I have written weekly since March, 1997. This is the last time, however, that I will use the Clue meme as part of my weekly column. Starting next week, and going forward, we'll go straight to the column. Enjoy.

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This could have been the 1930s. It’s shaping up to be the 1970s.

Not only are we getting stagflation instead of Depression, but we’re also finding ourselves, again, in a decade defined by energy. But while the 1970s were a decade of energy scarcity, this will become a decade of energy abundance.

Republicans want to credit fracking with all that has happened in our time. That technology has had an impact much like Obama’s Stimulus – it has accelerated changes already taking place. First natural gas went into glut, and this year oil went into glut.

Whether the glut is temporary or permanent, it’s permanent. Because the glut is giving alternative energy sources time and space to grow in. It’s also providing incentives for solar and wind to keep costs down, to keep innovating, because the ceiling under which they define “crossover” is a sinking one.