Economics of Technology – Page 11

New Guineans Bred “Pretty Tasty Bananas Without Formal Knowledge of the Principles of Inheritance and Evolution”

(p. D2) Wild bananas, or Musa acuminata, have flesh packed with seeds that render the fruit almost inedible. Scientists think bananas were domesticated more than 7,000 years ago on the island of New Guinea. Humans on the island at the time bred the plants to produce fruit without being fertilized and to be seedless. They were able to develop pretty tasty bananas without formal knowledge of the principles of inheritance and evolution.

For the full story, see:

Oliver Whang. “Fruitful Research: Yes, We Have Lots of Bananas, but Not the Ones You’re Looking For.” The New York Times (Tuesday, October 25, 2022): D2.

(Note: the online version of the story has the date Oct. 17, 2022, and has the title “The Search Is on for Mysterious Banana Ancestors.”)

In “Surprising Reversal” Federal and California “Democratic Leaders” Back Nuclear as “Reliable Power”

(p. B5) California’s last nuclear power plant received a $1.1 billion federal grant on Monday [Nov. 21, 2022] as the state seeks to extend the plant’s operations — currently set to end in 2025 — to meet electricity demand at a time of intensifying climate events.

. . .

The federal and state support from Democratic leaders for Diablo Canyon’s continued electricity production has been a surprising reversal. Senator Dianne Feinstein, who had supported retiring the plant, wrote an opinion essay in The Sacramento Bee this year about why she changed her mind.

On Monday [Nov. 21, 2022], Ms. Feinstein, a Democrat from California, again backed Diablo Canyon’s operations, disputing Mr. Weisman’s argument that the facility is not needed.

“This short-term extension is necessary if California is going to meet its ambitious clean-energy goals while continuing to deliver reliable power,” Ms. Feinstein said. “This is especially critical as California’s electric grid has faced increasing challenges from climate-fueled extreme weather events.”

For the full story, see:

Ivan Penn. “Lifeline for California Nuclear Plant Is a Bridge to Climate Goals, Advocates Say.” The New York Times (Tuesday, November 22, 2022): B5.

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

(Note: the online version of the story has the date Nov. 21, 2022, and has the title “U.S. Approves Aid to Extend Life of California Nuclear Plant.”)

Venture Capitalist Invested in Mainland But Now Prefers Taiwan’s “Freedom”

(p. B10) TAIPEI—Tim Draper, a venture capitalist known for his early bets in Elon Musk’s Tesla Inc. and SpaceX, is feeling good about his decision to stop investing in China.

In an interview in Taiwan, where he is pursuing new investments, Mr. Draper slammed China’s Xi Jinping, whom he called a “weak leader,” saying the country is going backward after more than four decades of former leader Deng Xiaoping’s “reform and opening up” policy.

“It’s not a place where you invest money to get a return,” he said. “I see China as a place where the government is trying to control everybody.”

An early investor in Baidu Inc.—China’s BIDU equivalent of Google—Mr. Draper said he pulled out completely and froze investment in the country around 2014 after a startup he had invested in was fined by regulators. It was a sign, he said, of the government’s increasing interference in the market.

. . .

Mr. Draper’s fund made its first investments in Taiwan last year, when it bought stakes in Taipei-based digital news company TNL Media Group and other startups. He said he would continue to invest in the island, which he believes will attract frustrated entrepreneurs from China with its openness.

“I’m coming to Taiwan. I’m not going to China,” he said, praising the democracy’s “freedom and trust.”

For the full story, see:

Joyu Wang. “Venture Capitalist Touts His Turning from China.” The Wall Street Journal (Saturday, September 19, 2022): B10.

(Note: ellipsis added.)

(Note: the online version of the story has the date September 18, 2022, and has the title “Tim Draper Touts Decision to Pull Out of China.”)

Electrical Vehicle (EV) Chargers Are “Often on the Fritz”

(p. A1) One of the biggest roadblocks to the mass adoption of electric vehicles is the troubled business model for the commercial chargers that power them.

The government is pouring billions of dollars into developing a national highway charging network. But businesses aren’t sure how they will make money, and the nascent industry looks messy.

Utility companies and gas stations are at war with each other over who will own and operate EV chargers. Rural states say some charging stations could operate at a loss for a decade or more. (p. A10) New companies that provide charging gear and services are contending with the equipment’s spotty reliability.

. . .

Equipment is often on the fritz. Communications can break down between the car and the charger, the charger and the company operating the charging network, and with payment systems. On occasion, a wasp crawls into the gear and builds a nest. Vandals can strike, sticking gum in the credit card readers and bashing the machines.

. . . A 2022 study led by the University of California, Berkeley tested all 657 public EV fast chargers in the greater San Francisco Bay Area and found more than a quarter didn’t work.

For the full story, see:

Jennifer Hiller. “Electric Cars Have A Charging Problem.” The Wall Street Journal (Wednesday, Nov. 30, 2022): A1 & A10.

(Note: ellipses added.)

(Note: the online version of the story has the date November 29, 2022, and has the title “Why America Doesn’t Have Enough EV Charging Stations.”)

Elon’s “Musketeers” Will Gladly Commit to “Long Hours at High Intensity”

(p. A12) Your boss probably hasn’t demanded a loyalty pledge and almost certainly doesn’t own a rocket ship, but the person calling the shots at your company might be more like Elon Musk than you realize.

. . .

What is consistent—and alluring to some bosses—is the billionaire’s unapologetically high standard for employees. He spelled it out last week in an emailed ultimatum, saying that Twitter employees must commit to “long hours at high intensity” or leave with three months’ severance.

. . .

Managers who think the working world has gone soft in recent years, with all the talk of flexibility and work-life balance, say they envy Mr. Musk’s unfiltered style and share his craving for maximum effort—even if they wouldn’t act quite as forcefully as the world’s richest person.

. . .

. . . he is the rare CEO with a fan base—“Musketeers,” as this male-dominated bunch is known—and might be able to fill the company’s ranks with devotees who believe in his vision of a more freewheeling and profitable platform and are willing to grind.

. . .

“He can do whatever he wants, and everyone that has an opinion about it can piss off,” says Derek Grubbs, director of sales development at Crux Informatics, a software company. “If everybody exits from Twitter, there are plenty of other people who will be ready to enter because it pays well, and working for Elon Musk has a flair to it.”

For the full commentary, see:

Callum Borchers. “ON THE CLOCK; The Bosses Who Want to Emulate Elon Musk.” The Wall Street Journal (Wednesday, November 23, 2022): A12.

(Note: ellipses added.)

(Note: the online version of the commentary has the date November 22, 2022, and has the title “ON THE CLOCK; Is Elon Musk Your Boss’s Anger Translator?”)

As Sole Owner Musk Was Able to Act Quickly to Cure Twitter’s “Systemic Paralysis”

(p. A17) Since Elon Musk purchased Twitter, he has undertaken a rapid restructuring that few large technology companies would attempt unless faced with an immediate liquidity crisis. Minutes after closing his purchase of the company, he started a process that reduced the workforce from 7,500 to 2,500 in 10 days.

Media pundits immediately slammed him, arguing that his slash-and-burn strategy would destroy one of the world’s most important social-media platforms—already in danger under the burden of $14 billion in debt. Much of this criticism came in the form of tweets, as the irony of using Twitter to denounce Twitter apparently escaped Mr. Musk’s critics. But the restructuring of Twitter won’t destroy the company.

Mr. Musk is trying to cure a degenerative corporate disease: systemic paralysis. Symptoms include cobwebs of corporate hierarchies with unclear reporting lines and unwieldy teams, along with work groups and positions that have opaque or nonsensical mandates. Paralyzed companies are often led by a career CEO who builds or maintains a level of bureaucracy that leads to declines in innovation, competitive stature and shareholder value.

Mr. Musk set his new tone immediately. He eliminated a 12-member team responsible for artificial-intelligence ethics in machine learning, the entire corporate communications department, and a headquarters commissary that cost $13 million a year (despite prior management’s pandemic decree that Twitter employees would be “remote forever”).

Three attributes give Mr. Musk a better chance of rebuilding Twitter into an innovative force in social media: He is an operator, an engineer and a sole owner.

For the full commentary, see:

Rob Wiesenthal. “Elon Musk Slashes Bureaucracy, Giving Twitter a Chance to Soar.” The Wall Street Journal (Friday, Dec. 9, 2022): A17.

(Note: the online version of the commentary has the date December 8, 2022, and has the same title as the print version.)

FTX Fraudster Bankman-Fried Made $40 Million in Midterm Political Donations Which Mostly “Went to Democrats and Liberal-Leaning Groups”

(p. A1) FTX founder Sam Bankman-Fried oversaw one of the biggest financial frauds in American history, a top federal prosecutor said in charging that the former chief executive stole billions of dollars from the crypto exchange’s customers while misleading investors and lenders.

. . .

(p. A6) Mr. Bankman-Fried is also accused of defrauding the Federal Election Commission starting in 2020 by conspiring with others to make illegal contributions to candidates and political committees in the names of other people.

He and his associates contributed more than $70 million to election campaigns in recent years, The Wall Street Journal previously reported. He personally made $40 million in donations ahead of the 2022 midterm elections, most of which went to Democrats and liberal-leaning groups.

For the full story, see:

Corinne Ramey, James Fanelli, Dave Michaels, Alexander Saeedy and Vicky Ge Huang. “FTX Founder Is Charged With Fraud.” The Wall Street Journal (Saturday, Dec. 14, 2022): A1 & A6.

(Note: ellipsis added.)

(Note: the online version of the story was updated Dec. 13, 2022, and has the title “FTX’s Sam Bankman-Fried Charged With Criminal Fraud, Conspiracy.”)

As of January 2022, Koch Industries Had Invested $1.7 Billion into Renewable-Energy Infrastructure

(p. B10) Norwegian startup Freyr Battery and energy conglomerate Koch Industries Inc. are accelerating their plan to build a multibillion-dollar battery plant that will be among the largest to tap incentives in President Biden’s climate, tax and spending plan, Freyr said.

. . .

Koch has emerged as one of the biggest investors in batteries, a turnabout from its emphasis on fossil fuels. It has said it wants to benefit from the falling cost of renewable-energy technologies and help drive it down further. As of January [2022], it had invested a total of $1.7 billion into electric batteries, energy storage and solar-power infrastructure, according to its website.

The plan is unusual among battery projects in being dedicated primarily to the energy-storage market rather than electric vehicles.

For the full story, see:

Stephen Wilmot. “Koch Teams Up on Battery Plant.” The Wall Street Journal (Saturday, November 12, 2022): B10.

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

(Note: the online version of the story has the date November 11, 2022, and has the title “Koch Teams With Startup to Build Giant Battery Factory.”)

“Woke” Bankman-Fried’s FTX Played “Dumb Game” of Virtue Signaling

(p. A17) There was a time when people engaged in doing good addressed problems that, so to speak, you could get your arms around, such as improving school performance, providing potable water or preventing malaria. But at some point, the impulse to do good transformed into a combination of moral tendentiousness and grandiosity.

. . .

. . ., inside the Bankman-Fried fairy tale rests a smaller tipping point, which suggests his generation senses that their preachy elders may have led them down a moral garden path.

In an exchange with Mr. Bankman-Fried, a writer for Vox asserts, “You were really good at talking about ethics.” He replied that “I had to be” because of “this dumb game we woke westerners play where we say all the right shibboleths and so everyone likes us.”

He is describing what has come to be known in our time as virtue signaling, . . .

For the full commentary, see:

Daniel Henninger. “WONDER LAND; The Moral Vanity of FTX.” The Wall Street Journal (Thursday, December 1, 2022): A17.

(Note: ellipses added.)

(Note: the online version of the commentary has the date November 30, 2022, and has the title “WONDER LAND; The Moral Vanity of Sam Bankman-Fried.”)

Entrepreneur Kerns’s Internal-Combustion-Engine Electric Generators Gave Power to the People

(p. A21) Robert D. Kern, a mechanical engineer who in the mid-1950s started a company in a garage making portable backup power generators and then transformed the business into an industry leader known as Generac, selling it in 2006 for an estimated $1 billion, died on Nov. 8 [2022] in Waukesha, Wis.

. . .

“The company is way beyond anything we dreamed about,” Mr. Kern said in an interview with the Grainger College of Engineering at the University of Illinois, his alma mater. “My vision was incredibly small compared to what it became, but tenacity is what it is all about.”

He and his wife and a few investors started the business after the rise of the airline industry had cost Mr. Kern his job making motors for railroad cars. Generac became a leading developer, manufacturer and marketer of portable and backup electric generators for homes and industry.

Today, Generac, based in Waukesha, about 18 miles west of Milwaukee, accounts for roughly 75 percent of standby home generator sales in the United States.

. . .

Mr. Kern was hired by the Waukesha Motor Company to design generators for combustion engines to be used on railway passenger cars. With the growth of the jet airline industry, rail travel in the United States plummeted, and Mr. Kern’s division was eliminated.

But remaining passionate about internal combustion engines, he decided to adapt developing technologies in generators for potential new markets and establish his own company to reach them.

In 1954, with his wife as the new company’s bookkeeper, he began making portable generators for recreational vehicles and for farmers and construction crews out of a garage in the village of Wales, Wis., about 28 miles west of Milwaukee. The business, originally called Electric Controls Inc., marketed the gear through Sears under the Craftsman brand. It became Generac in 1959, combining the word generation with AC.

. . .

Generac also developed an affordable backup generator for home emergencies and then expanded the business to produce permanent emergency generators for the commercial and industrial markets.

In 1967, the Generac factory in Waukesha burned to the ground, but with help from the local community, production resumed six days later, and the plant was rebuilt in seven weeks, without layoffs.

For the full obituary, see:

Sam Roberts. “Robert D. Kern, 96, Engineer Whose Idea For Portable Generators Produced Riches.” The New York Times (Thursday, November 24, 2022): A21.

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

(Note: the online version of the obituary has the date Nov. 22, 2022, and has the title “Robert D. Kern, 96, Whose Emergency Generators Produced Riches, Dies.”)

U.S. Chips+ Act Rewards Intel for Being Less Innovative Than TSMC

(p. A15) Intel, with huge profit margins on its Pentium microprocessors, could spend more than its competitors on state-of-the-art fabs, but innovation eventually was pushed aside for predictability. Intel would get one fab working and then “copy exactly” new cookie-cutter fabs. For smaller feature sizes, Intel looked at the new Extreme Ultraviolet technology from Dutch equipment company ASML and thought it too expensive and risky to use. TSMC embraced ExtremeUV and won, especially for lower-power chips for mobile devices. TSMC can now spend more than anyone else on fabs.

With the Chips+ Act chock full of $52 billion in subsidies and tax credits for chip makers, Congress is saying that real countries have fabs. The act also authorizes $1 billion for carbon removal—weird, because chips are made from silicon. Worse, the U.S. is rewarding Intel, which just announced a disastrous quarter, for coming in third place behind TSMC and Samsung.

Nothing is free. Even Commerce Secretary Gina Raimondo admitted “there’s a lot of strings attached” in the 1,054-page law. National Economic Council director Brian Deese endorsed command-and-control industrial policy: “The question should move from ‘Why should we pursue an industrial strategy?’ to ‘How do we pursue one successfully?’ ” This is as wrong as Soviet or Chinese five-year plans. Industrial policy eventually leads to disaster. Japan’s Ministry of International Trade and Industry micromanaged the country’s domestic semiconductor industry and ended up presiding over its decline. Today no Japanese semiconductor company sits in the global top 10. Because China doesn’t have access to ASML ExtremeUV equipment, it has made little progress in advanced chips.

Yes, we need domestic supplies of advanced chips in case China invades Taiwan. But subsidies are the wrong approach.

. . .

Instead, the U.S. could enable suppliers to place large orders for chips for the military, intelligence agencies, whatever. They could even prepay. Silicon Valley was originally built on orders for transistors for intercontinental missiles and the space program.

For the full commentary, see:

Andy Kessler. “INSIDE VIEW; The Semiconductor Boondoggle.” The Wall Street Journal (Monday, Aug. 15, 2022): A15.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date August 14, 2022, and has the same title as the print version.)