Category: Economics of Technology

Political Challenges Were Greater Than Technology Challenges in Creating Geostationary Satellites

(p. A13) After the Soviet Union launched Sputnik 1, the world’s first satellite, in 1957, a 31-year-old Rosen was inspired to build “a lightweight satellite that, when launched into a high orbit above the equator, would mimic the Earth’s rotation and retain its relative position, like a spoke on a wheel.” Mr. Amelinckx goes on: “This geostationary satellite would provide twenty-four-hour global communications, something never before attempted. Rosen was excited.”

Indeed he was. Rosen was a brilliant electrical engineer who worked at Hughes Aircraft in California. His tenacity enabled him to surmount, over the following years, the seemingly endless number of infuriating obstacles that stood between him and his goal. There was the multitude of technical problems to be solved—from the satellite’s weight to its spin, antenna, solar panels and more. There were the questions from NASA, Congress, the Pentagon and aerospace companies about whether the U.S. should prefer low-orbit satellites or geostationary ones. (The latter would possess greater transmitting and receiving versatility, but many scientists were convinced that geostationary satellites, which orbit at much higher altitudes, were impractical and would “take years to develop.”)

Mr. Amelinckx notes that solving the political challenges proved more difficult than creating the necessary technologies. Fortunately for Rosen, President Kennedy was keen on communications satellites. And so in 1961, NASA began funding Hughes to create Rosen’s vision.

For the full review, see:

Howard Schneider. “BOOKSHELF; How ‘Early Bird’ Got the Worm.” The Wall Street Journal (Friday, April 14, 2023): A13.

(Note: the online version of the review has the date April 13, 2023, and has the title “BOOKSHELF; ‘Satellite Boy’ Review: How ‘Early Bird’ Got the Worm.”)

The book under review is:

Amelinckx, Andrew. Satellite Boy: The International Manhunt for a Master Thief That Launched the Modern Communication Age. Berkeley: Counterpoint, 2023.

The “Huge Opportunity Cost” of Congress Keeping Obsolete Warthog Planes Flying

(p. A1) The Air Force has said for years that the A-10 jets, nicknamed Warthogs for their bulky silhouette and toughness in a fight, have passed their prime and will be vulnerable in the wars of the future. The production line where they were made fell silent in the mid-1980s, and the average A-10 here is four decades old. Its job can be done by newer, more advanced planes, the Air Force says.

“The A-10, while it has served us well, is simply not a part of the battlefield of the future,” said Lt. Gen. Richard Moore, the Air Force’s deputy chief of staff for plans and programs.

Congress has other ideas. Bowing to members whose constituencies are dependent on the jet for jobs and the flow of federal tax dollars, it has instead insisted nearly all the planes keep flying at a cost of more than $4 billion over the past 10 years.

This kind of intervention is common—and is (p. A9) impairing the U.S.’s ability to respond to rapidly modernizing Chinese forces in a new era of great-power competition, say current and former senior defense officials and military analysts.

Efforts by lawmakers to bring military jobs and funding to their districts and keep them there are as old as Congress itself. But they come at a huge opportunity cost at a time when the U.S. is facing its most formidable adversary since the end of the Cold War. Congress is in effect forcing the Pentagon to spend billions on programs for which it sees no role in future wars.

For the full story, see:

Daniel Nasaw. “Why Is America Still Flying the A-10 Warthog, a Cold War Relic?” The Wall Street Journal (Friday, April 14, 2023): A1 & A9.

(Note: the online version of the story has the date April 13, 2023, and has the same title as the print version.)

Biden EV Goals Depend on “Troubled” Business Model for Fast Charging

(p. A13) President Biden’s EV ambitions will hinge in large part on the availability of public places to plug in and repower cars reliably, a network that largely doesn’t exist. Building it won’t be easy.

While the government is (p. A2) pouring billions of dollars into developing a national highway charging network, many companies aren’t sure how they will make money off the nascent business. Fast charging requires expensive utility infrastructure and projects often encounter supply chain hang ups and long wait times to connect to the grid.

. . .

The business model for fast charging has been troubled because there aren’t enough EVs in most places yet for charging to turn a profit. Yet EV advocates say many drivers will only be comfortable purchasing vehicles if rapid charging is widely available.

Utility companies and gas stations have been arguing across several states about who will own and operate EV chargers. The expensive utility bills that can result from delivering quick jolts of power have been a particular point of contention. Meanwhile, the young companies that provide charging gear and services have struggled with equipment on the fritz, vandalism and driver payment systems, a frequent source of failure.

For the full story, see:

Jennifer Hiller. “Fast Electric-Vehicle Chargers Get Boost, But Hurdles Lurk.” The Wall Street Journal (Friday, April 14, 2023): A1-A2.

(Note: ellipsis added.)

(Note: the online version of the story was updated April 13, 2023, and has the title “Fast EV Chargers to Nearly Double on U.S. Highways Under Expansion Plan.” In the first paragraph quoted above, the online version has “Mr. Biden’s” instead of “President Biden’s.”)

Towns Flourish When Entrepreneurs Want to Live in Them

(p. B1) SIDNEY, Neb. — The forest green roof and pair of bronze stags frozen in combat are impossible to miss as you drive down Interstate 80.

. . .

For 54 years, Cabela’s made its home here, a juggernaut that kept the town humming. But in 2017, the sporting goods store sold for $5 billion to Bass Pro Shops — a takeover that eventually made 2,000 jobs vanish in a town of roughly 6,600 residents.

. . .

But Sidney’s staying power still surprises experts, who say it’s driven by two factors.

One: Former Cabela’s employees opening their small businesses, diversifying the economy in a formerly one-company town.

Two: A recent influx of new (p. B3) residents, both retirees and remote workers.

. . .

Each spring, high schoolers from Nebraska and neighboring states flock to Sidney searching for the perfect prom dress. Their destination: Charlotte & Emerson, a downtown boutique — and one example of Sidney’s rebirth from the ashes of Cabela’s.

Co-owner Sarah Kaiser and husband Kurt Kaiser both worked at Cabela’s. When the company was swallowed by Missouri-based Bass Pro, the family relocated there as Sarah Kaiser ran the combined company’s human resources.

But in 2020, they decided to return to Sidney, her hometown. Sarah Kaiser opened Charlotte & Emerson with her sister. Her husband launched an online fitness store, Frost Giant Fitness. They’re two of many Sidney-based companies run by ex-Cabela’s employees who decided to stick around and start something new.

“The corporate experience of these young folks really was key to this particular recovery,” said David Iaquinta, a Nebraska Wesleyan University sociology professor who has researched Sidney’s economic development. “. . . they combined that talent with a strong desire for the lifestyle that they had. They said, ‘We’re here. We’re rooted here.’”

Budding companies are being boosted by E3, a Nebraska Community Foundation program meant to aid entrepreneurship in rural Nebraska.

Already, new businesses have remodeled once-dilapidated buildings, said Sarah Sinnett, the program’s community lead.

. . .

Economic development in Nebraska “used to be about cheap land, cheap labor and cheap incentives” to nab big companies, Stinnett said.

Now: “If you want small towns to start thriving … really it needs to be focused on entrepreneurship,” she said.

For the full story, see:

Natalia Alamdari, Flatwater Free Press. “Sydney Shows Staying Power.” Omaha World-Herald (Sunday, April 23, 2023): B1 & B3.

(Note: ellipses between paragraphs, and bracketed date, added; ellipsis internal to paragraph, in original.)

(Note: the online version of the story was updated April 28, 2023, and has the title “Six years after ‘Cabela’s debacle,’ Sidney’s lights are still on.”)

Bell Labs Allowed Tanenbaum to Pursue Any Research that Interested Him

(p. A11) One evening in 1955, Morris Tanenbaum’s wife was playing bridge with friends. Dr. Tanenbaum, a chemist who worked for Bell Telephone Laboratories, the research arm of American Telephone & Telegraph Co., saw a chance to dash back to work to test his latest ideas about how to make better semiconductor devices out of silicon.

He tried a new way of connecting an aluminum wire to a silicon chip. He was thrilled when it worked, providing a way to make highly efficient transistors and other electronic devices, an essential technology for the Information Age.

“I don’t think I needed a car to get home that evening,” he said later in an oral history recorded by the IEEE History Center. “I was flying high.”

Dr. Tanenbaum’s pioneering work in the mid-1950s demonstrated that silicon was a better semiconductor material for transistors than germanium, the early favorite. He earned seven patents.

He later served as a senior executive of AT&T and helped manage the breakup of the phone monopoly mandated by the 1982 settlement of a Justice Department antitrust suit. At the signing of the consent decree, Dr. Tanenbaum cried gently, according to “The Deal of the Century,” a history of the breakup by Steve Coll.

What pained him most was the fate of Bell Laboratories, which had invented the transistor in 1947 and allowed him, as a young Ph.D. chemist in the early 1950s, to pursue basic research even if it didn’t promise near-term financial rewards.  . . .

“Bell Laboratories, the world’s premier industrial laboratory, was destroyed, a major national and global tragedy,” he wrote later in an unpublished memoir written for his family.

. . .

Hired by Bell Laboratories in Murray Hill, N.J. in 1952, he was told to look around for a research project that interested him. Researchers were allowed to pursue nearly any project “potentially related to some Bell System problem or future opportunity,” he wrote later. “What more could a young person expect?”

He zeroed in on studies of potential semiconducting materials. The first transistors were made from germanium, but that material was expensive. Silicon is abundant and thus cheaper. It also helps prevent overheating of circuits. Early efforts to use silicon for electronic devices hadn’t worked well, though. That was a challenge for Dr. Tanenbaum and his colleagues, including Ernie Buehler.

They weren’t alone in finding ways to use silicon. Gordon Teal was doing similar work at Texas Instruments Inc. in the mid-1950s. “From that moment forward, the world was focused on silicon,” Dr. Tanenbaum wrote.

Though AT&T made early breakthroughs, other companies, including Intel Corp. and Texas Instruments, charged ahead with better and faster microchips that transformed the world. AT&T was busy trying to defend its telephone monopoly. On the silicon front, Dr. Tanenbaum said, “we kind of dropped the ball.”

For the full obituary, see:

James R. Hagerty. “Chemist Helped Put Silicon in Microchips.” The Wall Street Journal (Saturday, March 04, 2023): A11.

(Note: ellipses added.)

(Note: the online version of the obituary has the date March 3, 2023, and has the title “Morris Tanenbaum, Who Helped Put Silicon in Microchips, Dies at 94.” The fourth paragraph quoted above appears in the online, but not the print, version.)

The book by Col mentioned above is:

Coll, Steve. The Deal of the Century: The Breakup of AT&T. New York: Atheneum Books, 1986.

Sam Bankman-Fried’s Brother Gabe Helped Send Misappropriated Funds to Dems, and Then Got “The Rock Star Treatment” From Biden White House

(p. B1) The group, Guarding Against Pandemics, raised more than $22 million in its first full year in 2021, turning it into an overnight lobbying force in Washington. The group’s founder, Gabe Bankman-Fried, a former legislative assistant, started getting the rock star treatment: two White House meetings with senior staff and invitations to speak on panels with government officials.

But almost all the money raised by Guarding Against Pandemics appears to have come from Gabe Bankman-Fried’s brother, whom federal prosecutors have accused of misappropriating billions of dollars from customers of his crypto exchange, FTX. The collapse of FTX prompted federal authorities to investigate allegations (p. B6) that sweeping fraud drove the exchange into bankruptcy in November [2023], as well as potential campaign finance law violations by both brothers.

Federal prosecutors in Manhattan have charged Sam Bankman-Fried, 31, with orchestrating a scheme to evade limits on corporate political donations. Prosecutors have said he recruited FTX executives and others to serve as proxies for the crypto exchange and make tens of millions of dollars in illegal political donations using customer money.

The authorities are investigating whether Gabe Bankman-Fried, 28, and some of his colleagues were part of the same so-called straw donor scheme, five people familiar with the matter said, speaking on the condition of anonymity. And they are trying to determine whether he knew some of the funds that his organization received had been misappropriated from customers.

Last month, a top FTX executive, Nishad Singh, pleaded guilty to using company money to make millions of dollars in straw donations to Democratic campaigns and committees.

. . .

The Bankman-Fried brothers relied on a small set of political consultants to guide their spending, applying the principles of effective altruism, the philanthropic movement that has a large following in the tech industry. A top adviser to both brothers was Michael Sadowsky, a committed effective altruist who had worked with the younger Mr. Bankman-Fried at the data firm Civis Analytics.

. . .

With a $25 million cash infusion from Sam Bankman-Fried, Mr. Sadowsky’s PAC became an instant force in Democratic politics. His group supported dozens of progressive candidates and got widespread attention when it spent more than $11 million on an unsuccessful House primary candidate in Oregon, an astonishing sum for such a race.

. . .

Two other key figures in the Bankman-Frieds’ political network had ties to prominent Democrats: Jenna Narayanan, a former political adviser to the billionaire investor Tom Steyer, and Sean McElwee, the founder of Data for Progress, a progressive think tank.

For the full story, see:

Matthew Goldstein, David Yaffe-Bellany and Lora Kelley. “Fraternal Turn to FTX Inquiry.” The New York Times (Friday, March 24, 2023): B1 & B6.

(Note: ellipses added.)

(Note: the online version of the story has the same date as the print version, and has the title “The Younger Brother Caught in the Middle of the FTX Investigation.”)

Entrepreneur Andy Yen’s Technology Enables Russians to Elude Censors

(p. A1) After Moscow erected a digital barricade in March [2022], blocking access to independent news sites and social media platforms to hide information about its unfolding invasion of Ukraine, many Russians looked for a workaround. One reliable route they found came from a small Swiss company based nearly 2,000 miles away.

The company, Proton, provides free software that masks a person’s identity and location online. That gives a user in Russia access to the open web by making it appear that the person is logging in from the Netherlands, Japan or the United States. A couple of weeks after the internet blockade, about 850,000 people inside Russia used Proton each day, up from fewer than 25,000.

That is, until the end of March, when the Russian government found a way to block Proton, too.

Targeting Proton was the opening salvo of a continuing back-and-forth battle, pitting a team of about 25 engineers against a country embarking on one of the most aggressive censorship campaigns in recent memory.

Working from a Geneva office where the company keeps its name off the building directory, Proton has spent nine pressure-packed months repeatedly tweaking its technology to avoid Russian blocks, only to be countered again by government censors in Moscow. Some employees took (p. A9) Proton off their social media profiles out of concern that they would be targeted personally.

The high-stakes chess match mirrors what is playing out with growing frequency in countries facing coups, wars and authoritarian rule, where restricting the internet is a tool of repression. The blocks drive citizens to look for workarounds. Engineers at companies like Proton think up new ways for those people to secretly reach the open web. And governments, in turn, seek out new technical tricks to plug leaks.

. . .

Companies rarely discuss being targeted by an authoritarian government out of fear of escalating the conflict. But Andy Yen, Proton’s founder and chief executive, said that after a period of trying to keep its “head down,” Proton wanted to raise awareness about the increasing sophistication of governments, in Russia and elsewhere, to block citizens from reaching the open web and the need for technologists, companies and governments to push back.

. . .

“We’re gearing up for a long fight,” Mr. Yen said in an interview at the company’s office. “Everybody hopes this will have a happy ending, but it’s not guaranteed. We don’t see the light at the end of the tunnel, in fact, but you keep going because if we don’t do it, then maybe nobody else will.”

. . .

The battle took on a “Spy vs. Spy” dynamic in Proton’s headquarters. Mr. Yen said a network of people within the government, telecommunications firms and civil society groups had helped Proton operate in Russia, providing access to local networks and sharing intelligence about how the censorship system worked. But those contacts began to go dark as the Kremlin’s crackdown on dissent intensified.

. . .

Mr. Yen was interrupted during a staff meeting in mid-July with news that Russian censors had come up with an even more elaborate block. A corporate chart from the time shows use dropping off a cliff. Russian engineers had identified what is known as an authentication “handshake,” the vital moment when Proton’s VPN connection gets established before reaching the wider web. Blocking the link made Proton’s service essentially unusable.

“We had no idea what was happening and how they were doing it,” Mr. Cesarano said.

By August, after working around the clock for days to find a fix, Proton acknowledged defeat and pulled its app from Russia. The company has spent the months since then developing a new architecture that makes its VPN service harder to identify because it looks more like a regular website to censorship software scanning a country’s internet traffic. Proton has been successfully testing the system in Iran, where Proton has seen a sharp increase in VPN use during recent political demonstrations.

In Russia, Proton has reintroduced its apps using the new system. Mr. Yen acknowledged that it probably wasn’t a long-term fix. He has confidence in the new technology, but figures Russian engineers will eventually figure out a new way to push back, and the game will continue.

For the full story, see:

Adam Satariano and Paul Mozur. “The Cat-and-Mouse Battle for Russia’s Internet.” The New York Times (Wednesday, December 7, 2022): A1 & A9.

(Note: ellipses, and bracketed year, added.]

(Note: the online version of the story was updated Dec. 9, 2022, and has the title “Inside the Face-Off Between Russia and a Small Internet Access Firm.” )

In Poor Country Where “Few People Have Air Conditioning” Heat Reduces Ability of Children to Learn and Parents to Produce

A growing movement among intellectuals opposes economic growth. I doubt that the movement will catch on in Freetown, Sierra Leone, where economic growth would allow more citizens to afford air conditioning.

(p. A4) . . . Eugenia Kargbo . . . [is] Freetown’s first chief heat officer, a post created in 2021, . . .

. . .

“Heat is invisible but it’s killing people silently,” Ms. Kargbo said in an interview on one of the top floors of Freetown’s city hall, a massive air-conditioned building that towers over the dozens of informal settlements dotting the capital of the small West African nation.

“Children are not sleeping at night because of extreme temperature,” she said. “It affects their ability to learn and their parents’ productivity.”

. . .

The country is one of the world’s poorest; few people have air conditioning; . . .

For the full story, see:

Elian Peltier. “In West African Hub, She Works to Counter Rising Temperatures.” The New York Times (Tuesday, January 7, 2023): A4.

(Note: ellipses added.)

(Note: the online version of the story has the date January 6, 2023, and has the title “She Is Africa’s First Heat Officer. Can She Make Her City Livable?”)

Taiwanese Engineers Who Built Dictator Xi’s Computer Chips, Are Voting With Their Feet for Taiwan’s Democracy and Freedom

(p. B1) TAIPEI, Taiwan — The job offer from a Chinese semiconductor company was appealing. A higher salary. Work trips to explore new technologies.

No matter that it would be less prestigious for Kevin Li than his job in Taiwan at one of the world’s leading chip makers. Mr. Li eagerly moved to northeast China in 2018, taking part in a wave of corporate migration as the Chinese government moved aggressively to build up its semiconductor industry.

He went back to Taiwan after two years, as Covid-19 swept through China and global tensions intensified. Other highly skilled Taiwanese engineers are going home, too.

For many, the strict pandemic measures have been tiresome. Geopolitics has made the job even more fraught, with China increasingly vocal about staking its claim on Taiwan, a self-ruled democracy.

. . .

(p. B4) For now, Mr. Li is staying in Taiwan, working for an American chip company operating there and siding with the invigorated patriotic sentiment and the ethos of individual liberty.

“The advantage of working in Taiwan is that you don’t have to worry about officials shutting down the whole company because of one thought,” he said. “The atmosphere is very important. At least I can watch all kinds of programs criticizing the governments on both sides of the Taiwan Strait without worrying about being arrested.”

For the full story, see:

Jane Perlez, Amy Chang Chien and John Liu. “Taiwanese Who Built Up Chip Sector in China Are Fed Up and Going Home.” The New York Times (Tuesday, November 22, 2022): B1 & B4.

(Note: the online version of the story has the date Nov. 16, 2022, and has the title “Engineers From Taiwan Bolstered China’s Chip Industry. Now They’re Leaving.” The online version says that the title of the print version is “They Built Up China’s Chip Sector. Now, They’re Going Home to Taiwan” but the title of my national edition copy is “Taiwanese Who Built Up Chip Sector in China Are Fed Up and Going Home.”)

Lethality of Ebola in West Africa Mainly Due to “the Contingent History of a Population Made Vulnerable”

(p. 22) As Farmer writes in his new book, “Fevers, Feuds, and Diamonds: Ebola and the Ravages of History,” by the time he arrived in the capital city of Freetown in late September, “western Sierra Leone was ground zero of the epidemic, and Upper West Africa was just about the worst place in the world to be critically ill or injured.”

. . .

Farmer notes that even severe cases of Ebola rarely produce the horror-film symptoms featured so prominently in Preston’s “Hot Zone”: patients bleeding from their eyeballs, their organs liquefied in a matter of hours. Most cases instead involve fluid and electrolyte loss caused by vomiting and diarrhea, which can often be treated with basic supportive and critical care, like intravenous fluid replenishment or dialysis. Ebola was so lethal in upper West Africa not because the virus itself conveyed an inevitable death sentence, but because countries like Liberia and Sierra Leone lacked these health care essentials. “For all their rainfall,” Farmer writes, “their citizens are stranded in the medical desert.”

. . .

“This was not,” Farmer writes, “a history of inevitable mortality that resulted from ancient evolutionary forces.  . . .   It was the contingent history of a population made vulnerable.”

For the full review, see:

Steven Johnson “A Preventable Epidemic.” The New York Times Book Review (Sunday, December 13, 2020): 22.

(Note: ellipses between paragraphs, added; ellipsis internal to last paragraph, in original.)

(Note: the online version of the review has the date Nov. 17, 2020, and has the title “The Deadliness of the 2014 Ebola Outbreak Was Not Inevitable.”)

The book under review is:

Farmer, Paul. Fevers, Feuds, and Diamonds: Ebola and the Ravages of History. New York: Farrar, Straus and Giroux, 2020.

Elon Musk Asks Twitter Employees for “Long Hours at High Intensity”

(p. B5) SAN FRANCISCO — Elon Musk gave Twitter employees a deadline of 5 p.m. Eastern time on Thursday [Nov. 17, 2022] to decide if they wanted to work for him, and he asked those who did not share his vision to leave their jobs, in his latest shock treatment of the social media company.

Mr. Musk made the announcement in an early-morning email to employees on Wednesday [Nov. 16, 2022]; The New York Times obtained the message, which had the subject line “A Fork in the Road.” In the note, Mr. Musk, 51, reiterated that Twitter faced a difficult road ahead and offered employees three months of severance if they did not want to continue working there “to build a breakthrough Twitter 2.0.”

. . .

In his note to Twitter employees on Wednesday, Mr. Musk said they would need to work hard — very hard. “In an increasingly competitive world, we will need to be extremely hard core,” he wrote. “This will mean working long hours at high intensity. Only exceptional performance will constitute a passing grade.”

For the full story, see:

Kate Conger. “Musk’s Ultimatum: Buy In or Get Out.” The New York Times (Thursday, November 17, 2022): B5.

(Note: ellipsis, and bracketed dates, added.)

(Note: the online version of the story has the date Nov. 16, 2022, and has the title “Elon Musk Gives Twitter Employees a Deadline to Stay or Leave.”)