Digest: 28 April 2013

Abstract

Whether Ben Bernanke’s policy of keeping interest rates low has helped or hindered the US economy; A company to help in the verifying the sustainability of products; Warren Buffett’s coal transportation business runs up against environmental interests, cattle ranchers, and Native Americans; New methods of more sustainable farming must be developed to avoid crop failures and increased pollution in the future; Mini Coopers fitted with two-way chargers are designed to both receive energy from and supply energy to power grids; Thatcher was a breaker of consensus than a builder of it and her policies were never in accord with the interests of a majority of UK citizens;  Those who support social insurance as a necessary element of civilised modern society need to discredit terminology dictated by contrary interests;  Switzerland’s success when seen against the economic and political crises of the rest of Europe; Technology is advancing far faster than is our understanding of its implications, and these advances carry the potential for massive disruption of human life.

Economics

In Shut Up Savers!, James Surowiecki (for The New Yorker) discusses monetary policy, specifically the question of whether Ben Bernanke’s policy of keeping interest rates low has helped or hindered the US economy.  He points out that many argue that Bernanke’s policies have undermined savers, by reducing the interest that savers may accumulate on their money.  But he argues that the major issue in the US economy is that many people don’t have income to save because they don’t have jobs. Therefore the main push must be to encourage businesses to invest and hire (and people to buy homes).  He argues that if the Fed did raise interest rates, it wouldn’t help savers anyway because the economy would slow potentially bringing on another recession.

Environment

In Stocking the Shelves with a Green Solution, Nick Lieber (for Bloomberg Businessweek) discusses Sarah Beatty’s company Green Depot, which acts as a green-product verifier – it evaluates supposedly green products according to a variety of criteria.  The goal is to help people/businesses who want to source sustainable products (such as building materials) know whether the products are indeed as sustainable as they claim to be.

In Warren Buffett’s Coal Problem, Marc Gunther (for The Sierra Club) discusses Warren Buffett’s coal transportation business and his environmental interests in general.  Buffett’s company, BNSF Railway, transports coal.  There is in the works an effort to develop the coal industry in a remote area of southeastern Montana.  If developed this project will produce one of the largest coal strip mines in the western US so that it can ship the coal to China through West Coast ports.  In order to do so it must build a railway line to connect it to Buffett’s company, which will be in charge of carrying it.  BNSF Railway is coming up against resistance from ranchers and Native Americans, as well as environmental groups such as The Sierra Club.  Gunther points out that Buffett’s interests in environmental consciousness seem limited, perhaps restricted to the extent he is able to make money of such consideration – he is invested in wind power for example, but lobbies on behalf of coal companies where his interests are aligned with those, and has been know to urge Berkshire Hathaway shareholders to not vote in favor of setting goals for reducing greenhouse gas emissions.

In Fertilized World: A Mixed Blessing, Dan Charles (for National Geographic) discusses issues related to the use of nitrogen in farming.  Nitrogen is an element required in the process of photosynthesis – without it, proteins cannot form and plants cannot grow.  Naturally occurring nitrogen is formed in soils through the decomposition of organics materials, but can be depleted through heavy crop-growing, particularly in the case of crops such as wheat, corn, and rice – the staples of modern human consumption.  in the 20th Century, to increase nutrient levels to support high-yield agriculture, chemists developed modern synthetic fertilizers.  These fertilizers however have a tendency towards high levels of run-off, resulting in the pollution of vital water-sources.  It is argued that heavy farming has over-taxed soils and the employment of synthetic nitrogen has been significantly over-employed.  In addition, synthetic fertilizers are expensive, particularly for farmers in the developing world.  New methods of more sustainable farming must be developed to avoid crop failures and increased pollution in the future – some promising signs can be found on small farms around the world.

In the New York Times article, In Two-Way Charging, Electric Cars Begin to Earn Money from the Grid, Matthew L. Wald discusses a new trial in which Mini Coopers have been fitted with two-way chargers designed to not just receive energy from power grids, but also to feed energy into those grids.  One consideration that must be addressed in the provision of power is the necessity to maintain the stability of the grid – the steady balancing of supply and demand.  Mechanisms are being developed which could use cars to help maintain the stability of the grid – by communicating with the grid, the cars could feed energy into it when energy is needed by the grid and draw energy out when the car needs to charge.  While this would help to maintain power levels in the grid, it could also maintain “spinning reserve”, the need to keep turbines spinning when not generating power.

Politics

In The Thatcherist, Hendrik Hertzberg discusses the career of former UK Prime Minister Margaret Thatcher, particularly her role as a consensus-maker for the people of the UK.  In the course of the responses to her death, current Prime Minister credited her with “winning the backing of the British people three times in a row”.  Hertzberg points out the inaccuracy of this statement.  He argues to the contrary that in fact she was more of a breaker of consensus than a builder of it, and that as a result of the structure of the UK Parliamentary system, her policies were never in accord with the interests of a majority of UK citizens. He points out that rather than embodying a position of care for the majority, she created “a Britain of pitiless dynamism and poisonous inequality.”  Her moral high ground came with her support of environmental concerns, but even this was repealed in retirement when she dismissed climate change as “a marvelous excuse for worldwide, supra-national socialism.”

In Senses of Entitlement, Hendrik Hertzberg discusses the controlled use of terminology to shift public opinion – particularly  in this case the use of the word “entitlement” to refer to social insurance.  Words have connotations, and in politics choice of terminology is rarely accidental.  ”Entitlement” in the US, a country which holds as part of its national identity a sense of hard work, does not have positive connotations – the term suggests the expected receipt of something undeserved.  Those who support social insurance as a good and necessary element of a civilised modern society need to be more careful about allowing public discussion to adopt terminology dictated by contrary interests.

Social

In The Swiss Miracle?: Beyond Chocolate, Cheese, and Banking, Roland Benedikter and Lukas Kaelin (for Foreign Affairs) discuss the relative success that Switzerland has enjoyed in contrast to the economic and political crises that have dogged much of the rest of Europe.  There are several bases for this discrepancy – the Swiss political system has far greater legitimacy than those in the rest of Europe which suffer from often conflicting national and EU structures.  Swiss democracy maintains at the executive level far greater inclusion of the country’s various parties than is found in other European nations, citizens are also far more involved in their country’s policy than citizens elsewhere.  As a result of Switzerland system of constitutional amendment, citizens take part in polls as many as four times in a year, and this constant involvement creates through its accountability of government to citizenry, a rare legitimacy among European countries.  Benedikter and Kaelin describe four lessons that EU can learn from the Swiss: small scale administration autonomy; direct and frequent appeals to the public to increase the palatability of government; and the same for purposes of  increasing a sense of responsibility over government; and finally maintenance of autonomy within integration.

In How Are Humans Going to Become Extinct, Sean Coughlin (for BBC News) discusses the very real possibility of  unprecedented disruption of human life within the near future.  Normally when we think of threats to our survival we think of risks such as pandemics and natural disasters, and while these risks are considerable, another set of risks are far more worrying.  The risks that are most egregious are ones that we think very little about – biological risks associated with genetic modifications and chain-reaction risks associated with biotechnology and nanotechnology.  Technology is advancing far faster than is our understanding of its implications, and some of these advances carry the potential for massive disruption of human life.