Category: Economics

Wind Turbines and Solar Panels Are Destroyed by Severe Wind and Hail

(p. A15) The footage from southwest Iowa is shocking: In the trail of a tornado, a wind turbine is bent in half like a cheap straw, its hub engulfed in flames and thick black smoke, its blades on the ground.

“You’re seeing multiple of these big wind turbine towers that have been destroyed,” Zane Satre, a meteorologist for KCCI 8 News in Des Moines, told viewers. “These are big tall ones — I think they’re what, like 250 feet tall? Well that tornado took them out.”

. . .

The damage in Iowa to three turbines was part of a spell of bad weather that struck the state on Tuesday [May 21, 2024], . . .

. . .

When it comes to extreme weather and renewable energy, the larger problem is the vulnerability of solar panels to hailstorms, Mr. McLachlan said.

To reduce costs, panels have become larger over time, and the glass has become thinner, making it more likely to crack when hail strikes. That’s happening as more solar panels are being installed in the hail-prone Midwest — and as the frequency and severity of hail increase.

The standard way to protect solar panels from hailstones is to change their angle, Mr. McLachlan said, tipping them so that their surface is less exposed to direct hits. But that creates a new problem: those panels start to act like sails, catching the winds that often accompany hail, increasing the risk of blowing away.

Hail made up 54 percent of incurred costs from insurance claims for the solar sector over the past five years, according to a report from GCube last year, despite accounting for just 1.4 percent of claims. Growing losses from hail have made it harder to get insurance for solar projects, Mr. McLachlan said.

For the full story see:

Christopher Flavelle. “Giants Built for a Gale Crumple to the Ground.” The New York Times (Thursday, May 23, 2024): A15.

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

(Note: the online version of the story has the date May 22, 2024, and has the title “Tornado Pummels Wind Turbines in Iowa.”)

California Politicians Ban Test of Sprayed Seawater That Might Reverse Global Warming

Some environmentalists are only willing to cool the planet by the pain of less consumption.

(p. A14) Elected leaders in Alameda, Calif., voted early on Wednesday [June 5, 2024] to stop scientists from testing a device that might one day be used to artificially cool the planet, overruling city staff members who had found the experiment posed no danger.

. . .

The test involved spraying tiny sea-salt particles across the flight deck of a decommissioned aircraft carrier, the U.S.S. Hornet, docked in Alameda in San Francisco Bay. Versions of that device could eventually be used to spray the material skyward, making clouds brighter so that they reflect more sunlight away from Earth. Scientists say that could help to cool the planet and to fight the effects of global warming.

. . .

“The chemical components of the saltwater solution (which is similar to seawater) being sprayed are naturally occurring in the environment,” the report said. Staff recommended that the City Council allow the experiment to continue, . . .

. . .

Some environmentalists oppose research aimed at so-called climate intervention, also known as solar geoengineering. They argue that such technology carries the risk of unintended consequences, and also takes money and attention away from efforts to reduce the use of fossil fuels, the burning of which is the underlying cause of climate change.

For the full story see:

Soumya Karlamangla and Christopher Flavelle. “Leaders in California City Halt Cloud-Brightening Test.” The New York Times (Thursday, June 6, 2024): A14.

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

(Note: the online version of the story has the date June 5, 2024, and has the title “California City Leaders End Cloud-Brightening Test, Overruling Staff.”)

Tax Universities to Offset Their Negative Externalities?

(p. A11) What can we do about the corruption of American higher education? Milton Friedman had an idea 20 years ago: Tax the schools rather than subsidize them. That reflected a change of heart. In “Capitalism and Freedom” (1960), he argued that college education had enough “positive externalities” to justify subsidies. But when I was researching a book in 2003, I emailed him (then 91) and asked if he still believed that.

He replied: “I have not changed my view that higher education has some positive externality, but I have become much more aware that it also has negative externalities. I am much more dubious than I was . . . that there is any justification at all for government subsidy of higher education. The spread of PC”—political correctness—“would seem to be a very strong negative externality, and certainly the 1960s student demonstrations were negative externalities. . . . A full analysis along those lines might lead you to conclude that higher education should be taxed to offset its negative externalities.”

For the full commentary, see:

Richard Vedder. “Harvard Should Pay Its Fair Share.” The Wall Street Journal (Saturday, Dec. 23, 2023): A11.

(Note: ellipses in original.)

(Note: the online version of the commentary has the date December 22, 2023, and has the same title as the print version.)

Friedman’s book mentioned above is:

Friedman, Milton. Capitalism and Freedom. Chicago: The University of Chicago Press, 1962.

“A Major Environmental Group” Will Fund Geoengineering Research

(p. A18) The Environmental Defense Fund will finance research into technologies that could artificially cool the planet, an idea that until recently was viewed as radical but is quickly gaining attention as global temperatures rise at alarming rates.

The group hopes to start issuing grants this fall, said Lisa Dilling, associate chief scientist at E.D.F., who is running the project. She said research would focus on estimating the likely effects in different parts of the world if governments were to deploy artificial cooling technologies.

. . .

The Environmental Defense Fund has previously expressed skepticism about techniques like these. But Dr. Dilling says the discussion about ways to cool the planet isn’t going away, regardless of opposition. “This is something that I don’t think we can just ignore,” she said.

The group will fund what is sometimes called solar radiation modification, or solar geoengineering, which involves reflecting more of the sun’s energy back into space. Possible techniques involve injecting aerosols into the stratosphere, or brightening clouds to make them more reflective.

. . .

That a major environmental group like the Environmental Defense Fund is investing in solar geoengineering research sends a powerful message, said Larry Birenbaum, a partner at the LAD Climate Fund, one of the groups funding the research. He said his group had been urging environmentalists for years to pay attention to solar geoengineering.

“We’re not going to convince everyone about the necessity for research,” said Mr. Birenbaum, a former senior vice president at Cisco Systems. “The climate community in general needs to be convinced, because this is on the fringe now, and it deserves not to be.”

For the full story see:

Christopher Flavelle. “Experiments to Artificially Cool the Earth Are Getting a Major Backer.” The New York Times (Tuesday, June 11, 2024): A18.

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

(Note: the online version of the story has the date June 10, 2024, and has the title “Environmental Group to Study Effects of Artificially Cooling Earth.”)

Europe’s Regulations Reduce Economic Dynamism

(p. A23) Growth and dynamism: In 1960 the E.U. 28 — the 27 countries currently in the European Union, plus Britain — accounted for 36.3 percent of global gross domestic product. By 2020 it had fallen to 22.4 percent. By the end of the century it is projected to fall to just under 10 percent. By contrast, the United States has maintained a roughly consistent share — around a quarter — of global G.D.P. since the Kennedy administration.

Think of any leading-edge industry — artificial intelligence, microchips, software, robotics, genomics — and ask yourself (with a few honorable exceptions), where’s the European Microsoft, Nvidia or OpenAI?

. . .

How much state protection, in social welfare and economic regulation, are Europe’s aging voters willing to forgo for the sake of creating a more dynamic economy for a dwindling number of young people?

For the full commentary, see:

Bret Stephens. “This D-Day, Europe Needs to Resolve to Get Its Act Together.” The New York Times (Wednesday, June 5, 2024): A23.

(Note: ellipsis added; bold font in original.)

(Note: the online version of the commentary has the date June 4, 2024, and has the same title as the print version.)

Biden’s Tax and Regulation Plans Shift “Demonized” Silicon Valley Toward Trump

(p. B1) In 2021, David Sacks, a prominent venture capital investor and podcast host, said former President Donald J. Trump’s behavior around the Jan. 6 [2021] riot at the U.S. Capitol had disqualified him from being a future political candidate.

At a tech conference last week, Mr. Sacks said his view had changed.

“I have bigger disagreements with Biden than with Trump,” the investor said. Mr. Sacks said he and his podcast co-hosts were working on hosting a fund-raiser for Mr. Trump, which could include an interview for their “All In” show.  . . .

Such public support for Mr. Trump used to be taboo in Silicon Valley, which has long been seen as a liberal bastion. But frustration with Mr. Biden, Democrats and the state of the world has increasingly driven some of tech’s most prominent venture capitalists to the right.

. . .

(p. B5) Delian Asparouhov, an investor at Founders Fund, the investment firm founded by Mr. Thiel, recently marveled at how much the political winds had shifted. This month, Mr. Trump made a virtual appearance at a venture capital conference in Washington. There, he thanked attendees for “keeping your chin up” and said he looked forward to meeting them.

“Four years ago you had to issue an apology if you voted for him,” Mr. Asparouhov wrote on X.

Mr. Sacks, Mr. Palihapitiya and Founders Fund did not respond to a request for comment. Sequoia Capital declined to comment.

The comments and activity by the group of tech investors are particularly noticeable given Silicon Valley’s blue background.

. . .

The . . . “techlash” against Facebook and others caused some industry leaders to reassess their political views, a trend that continued through the social and political turmoil of the pandemic.

During that time, Democrats moved further to the left and demonized successful people who made a lot of money, further alienating some tech leaders, said Bradley Tusk, a venture capital investor and political strategist who supports Mr. Biden.

“If you keep telling someone over and over that they’re evil, they’re eventually not going to like that,” he said. “I see that in venture capital.”

That feeling has hardened under President Biden. Some investors said they were frustrated that his pick for chair of the Federal Trade Commission, Lina Khan, has aggressively moved to block acquisitions, one of the main ways venture capitalists make money. They said they were also unhappy that Mr. Biden’s pick for head of the Securities and Exchange Commission, Gary Gensler, had been hostile to cryptocurrency companies.

The start-up industry has also been in a downturn since 2022, with higher interest rates sending capital fleeing from risky bets and a dismal market for initial public offerings crimping opportunities for investors to cash in on their valuable investments.

Some also said they disliked Mr. Biden’s proposal in March [2024] to raise taxes, including a 25 percent “billionaire tax” on certain holdings that could include start-up stock, as well as a higher tax rate on profits from successful investments.

Mr. Sacks said at the tech conference last week that he thought such taxes could kill the start-up industry’s system of offering stock options to founders and employees. “It’s a good reason for Silicon Valley to think really hard about who it wants to vote for,” he said.

. . .

Mr. Andreessen, a founder of Andreessen Horowitz, a prominent Silicon Valley venture firm, said in a recent podcast that “there are real issues with the Biden administration.” Under Mr. Trump, he said, the S.E.C. and F.T.C. would be headed by “very different kinds of people.” But a Trump presidency would not necessarily be a “clean win” either, he added.

Last month, Mr. Sacks, Mr. Thiel, Elon Musk and other prominent investors attended an “anti-Biden” dinner in Hollywood, where attendees discussed fund-raising and ways to oppose Democrats, a person familiar with the situation said. The dinner was earlier reported by Puck.

For the full story see:

Erin Griffith. “Silicon Valley Notables Are Shifting to the Right.” The New York Times (Friday, May 24, 2024): B1 & B5.

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

(Note: the online version of the story has the date May 22, 2024, and has the title “Some of Silicon Valley’s Most Prominent Investors Are Turning Against Biden.”)

Species Shifting Their Range Due to Climate Change May Have Enabled the “Playing Around With Resources” That Invented Farming

(p. D6) In the 1990s, archaeologists largely concluded that farming in the Fertile Crescent began in Jordan and Israel, a region known as the southern Levant. “The model was that everything started there, and then everything spread out from there, including maybe the people,” said Melinda A. Zeder, a senior research scientist at the Smithsonian National Museum of Natural History.

But in recent years, Dr. Zeder and other archaeologists have overturned that consensus. Their research suggests that people were inventing farming at several sites in the Fertile Crescent at roughly the same time. In the Zagros Mountains of Iran, for example, Dr. Zeder and her colleagues have found evidence of the gradual domestication of wild goats over many centuries around 10,000 years ago.

People may have been cultivating plants earlier than believed, too.

In the 1980s, Dani Nadel, then at Hebrew University, and his colleagues excavated a 23,000-year-old site on the shores of the Sea of Galilee known as Ohalo II. It consisted of half a dozen brush huts. Last year, Dr. Nadel co-authored a study showing that one of the huts contained 150,000 charred seeds and fruits, including many types, such as almonds, grapes and olives, that would later become crops. A stone blade found at Ohalo II seemed to have been used as a sickle to harvest cereals. A stone slab was used to grind the seeds. It seems clear the inhabitants were cultivating wild plants long before farming was thought to have begun.

“We got fixated on the very few things we just happened to see preserved in the archaeological record, and we got this false impression that this was an abrupt change,” Dr. Zeder said. “Now we really understand there was this long period where they’re playing around with resources.”

Many scientists have suggested that humans turned to agriculture under duress. Perhaps the climate of the Near East grew harsh, or perhaps the hunter-gatherer population outstripped the supply of wild foods.

But “playing around with resources” is not the sort of thing people do in times of desperation. Instead, Dr. Zeder argues, agriculture came about as climatic changes shifted the ranges of some wild species of plants and animals into the Near East.

Many different groups began experimenting with ways of producing extra food, which eventually enabled them to start a new way of life: settling down in more stable social groups.

For the full story see:

Carl Zimmer. “The First Farmers.” The New York Times (Tuesday, October 18, 2016 [sic]): D1 & D6.

(Note: the online version of the story has the date Oct. 17, 2016 [sic], and has the title “How the First Farmers Changed History.”)

The 2015 study co-authored by Dani Nadel and mentioned above is:

Snir, Ainit, Dani Nadel, Iris Groman-Yaroslavski, Yoel Melamed, Marcelo Sternberg, Ofer Bar-Yosef, and Ehud Weiss. “The Origin of Cultivation and Proto-Weeds, Long before Neolithic Farming.” PLOS ONE 10, no. 7 (July 22, 2015): e0131422.

Economical Parrots Decline an Immediate Smaller Treat to Be Able to Trade a Token for a Bigger Treat

(p. D3) Chalk up another achievement for parrots, . . . .

Anastasia Krasheninnikova and colleagues at the Max Planck Institute for Ornithology in Germany tested four species of parrots in an experiment that required trading tokens for food and recently reported their findings in the journal Scientific Reports.

. . .

A metal hoop could be traded for a piece of dry corn, the lowest value food, a metal bracket for a medium value sunflower seed and a plastic ring for the highest value food, a piece of shelled walnut.

The birds were then offered various choices, like a piece of corn or the ring. They all reliably chose to forgo the corn and take the ring. Then they were able to trade the ring for a piece of walnut.

They also did well choosing a bracket instead of the corn, and in other situations where the token was of higher value than the food.

For the full story see:

James Gorman. “Parrots Think They’re Pretty Smart.” The New York Times (Tuesday, Sept. 11, 2018 [sic]): D3.

(Note: ellipses added.)

(Note: the online version of the story has the same date as the print version, and has the title “Parrots Think They’re So Smart. Now They’re Bartering Tokens for Food.” Where there is a small difference in wording between the versions, the passages quoted above follow the online version.)

The paper published in Scientific Reports and mentioned above is:

Krasheninnikova, Anastasia, Friederike Höner, Laurie O’Neill, Elisabetta Penna, and Auguste M. P. von Bayern. “Economic Decision-Making in Parrots.” Scientific Reports 8, no. 1 (2018): 12537.

Nobelist Phelps Opposes a Universal Basic Income, Since Recipients Might Miss the Fulfilment That Comes from Meaningful Work

UBI below stands for Universal Basic Income.

(p. C9) And yet Mr. Phelps, the winner of the 2006 Nobel Prize in economics and emeritus professor of political economy at Columbia University, is among the most lucid, passionate and original defenders of capitalism. (He is also the founding director of Columbia’s Center on Capitalism and Society.) He disparages European-style corporatist economies as being unsuited to dynamism or innovation. Progressives who’d claim him as their own would do well to remember that he takes a hostile view of the idea of a universal basic income.

In “My Journeys in Economic Theory,” Mr. Phelps declares that it is “disappointing that UBI”—embraced by such modish politicians as Andrew Yang and Alexandria Ocasio-Cortez—“has not received widespread opposition.” The idea, if implemented, “would entice people and their children away from meaningful work and thus from a sense of involvement in the economy—society’s central project.”

It is this last, humane observation that distinguishes Mr. Phelps from the economists’ tribe, reflecting his belief that the nobility of capitalism lies in the chance it offers for prosperity and self-discovery on a national scale. He calls this phenomenon “mass flourishing,” words that make up the title of his late-in-life magnum opus, published in 2013 when he was 80.

. . .

It is apparent in his memoirs that Mr. Phelps wishes to be remembered most for his theories of the past two decades, which focus on the workplace and creativity. He believes that economists are mistaken in their supposition that the reward for work is pay alone. As he writes in “Dynamism” (2020), in America “it is very clear that work is central to a meaningful life.” People at all rungs of the economy “possess imagination and creativity,” and the modern economy is “a vast imaginarium” in which growth comes from “creativity within the workforce.”

Mr. Phelps underscores a connection between economic growth and job satisfaction. He urges economists “not to stop at the standard theory” but to explore an “uncharted realm” of human desires and fulfillments. There’s more to life than capital, mere employment and national income. And certainly more to economics.

For the full review, see:

Tunku Varadarajan. “On the Way to the Nobel, and After.” The Wall Street Journal (Saturday, May 13, 2023): C9.

(Note: the online version of the review has the date May 12, 2023, and has the title “‘My Journeys in Economic Theory’ Review: A Creative Nobelist.”)

The book under review is:

Phelps, Edmund S. My Journeys in Economic Theory. New York: Columbia University Press, 2023.

Phelps’s magnum opus, mentioned above, is:

Phelps, Edmund S. Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change. Princeton, New Jersey: Princeton University Press, 2013.

University of Chicago Press Undermines Its Own New Edition of Milton Friedman’s Capitalism and Freedom

(p. C9) I had never read “Capitalism and Freedom” and was renewed in my admiration for midcentury American reading audiences. The book, full of tightly reasoned arguments about the principles of economic freedom in various spheres of life, sold 400,000 copies in its first 18 years. The University of Chicago Press, which first published the book six decades ago, evidently would rather it stop selling. The new edition’s foreword is written by Binyamin Appelbaum, a member of the New York Times editorial board, who treats Friedman’s classic text as mildly interesting artifact. “Friedman’s claim that ‘widespread use of the market reduces the strain on the social fabric,’ ” Mr. Appelbaum assures us, “misapprehended the nature of society, which is more like a muscle than a fabric.” I await Chicago’s edition of J.K. Galbraith’s “The Affluent Society,” with a foreword by Larry Kudlow.

For the full review, see:

Barton Swaim. “Of Markets and Morals.” The Wall Street Journal (Saturday, Jan. 30, 2021 [sic]): C9.

(Note: the online version of the review has the date January 29, 2021 [sic], and has the title “Politics: Of Markets and Morals.”)

The book under review is:

Friedman, Milton. Capitalism and Freedom. Chicago: The University of Chicago Press, 2020 [1st ed. 1962].

Shark Tank Shows Capitalism as a “Bootstrap Meritocracy”

(p. 24) . . . my favorite TV show is “Shark Tank.”  . . .  The premise of the tank is that small-business owners get an audience with investors — the “sharks,” a crew of millionaires and billionaires that includes Mark Cuban, Daymond John and Lori Greiner, the “queen of QVC” — in the hope of provoking a bidding war for a stake in the company. Sometimes the sharks dismiss the ideas outright, and they often do so cruelly, but in a satisfying, detailed way. You start to feel as if you could write your own business plan after watching a few episodes.

. . .

(p. 25) The show dramatizes a romantic vision of our economy, depicting it as a bootstrap meritocracy.

. . .

Part of the show’s appeal is that it’s an equal-opportunity forum — you don’t have to know a Silicon Valley V.C. or even a banker to get your audience with the sharks.

. . .

I was so politically assertive as a kid because I wanted someone to respect my opinion, to value me. I wanted to be taken seriously. I think most kids feel this way, dismissed outright for being small. In the tank, no one is dismissed — the sharks start every segment with furrowed brows, ready to take notes and hear out pitches, no matter how preposterous. They begin the process with a clean slate every time. Somewhere deep down, I want all these deals to work, I want the enthusiasm that sharks feel to be genuine and I want the contestants to walk away with business plans ready to be set into motion. Even if “Shark Tank” is propaganda — the selling and marketing of the American dream — the fantasy feels real.

For the full commentary, see:

Jaime Lowe. “Letter of Recommendation: ‘Shark Tank’.” The New York Times Magazine (Sunday, October 1, 2017 [sic]): 24-25.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Sept. 28, 2017 [sic], and has the same title as the print version.)