Biofuel vs Food a False Debate?

Popular Science has a quick blurb about the First Annual BioMass Conference, which, in part, sought to dismiss new controversy about biofuels leading to global high food prices. An excerpt:

More to the point, though, is the mistaken notion that we have to use food crops for fuel production. In test fields in Minnesota, Tilman and his colleagues have found that the best energy yields actually come from native prairie grasses, not corn or soy. And, said Tilman, “there’s a surprising benefit from the mixture of species. Farmers know this from growing pastures. Nobody plants a pasture of a single species. They put out a variety of grasses, legumes…and so on. They do that because that gives them a higher yield.”

This reminds me of an old adage in many public policy circles: economics doesn’t exist; politics doesn’t exist; there is only the political economy. Here is a case where that maxim most certainly applies; although many people are very well aware, the US farming lobby no less, that biofuels from corn and soy are inferior to other crops like switchgrass and sugar, US agricultural policy actively and inappropriately props up corn prices by subsidizing its cultivation for ethanol.

So yes, biofuel itself is not the problem - and will likely be an integral part of the solution - but to apologize for stratospheric food prices because ‘corn ain’t that good anyway,’ is absolutely unhelpful.

This is not a Sports Blog

At the risk of venturing into the dangerous territory of wholesale weblog digression, I want to make a quick comment on the Flyers-Penguin best of 7 playoff series.

When I first moved to Philadelphia, I was pretty amazed at how many people watched/enjoyed professional hockey. Back in Virginia - and almost everywhere else I’ve been besides Minnesconsin - hockey is very much an afterthought, the province of canucks and strange US northern folk who live in perpetual blizzard. I’ve more or less resisted following the progress of the Flyers until the oh-so-epic playoff series began against the Pittsburgh Penguins.

As the situation grows more dire for Philadelphia’s beloved squad, I’m gradually shedding my nonchalance and I think I’m prepared to say that I support Philadelphia 100% in this great and noble endeavor. Destroy Pittsburgh! Does this mean I’ll be following hockey religiously from now on? No; I’m still very much more of a soccer and baseball fan, but this is a terribly exciting moment for Philadelphia hockey and too good to ignore.

As an aside - I was reading a Bloomberg article on the subject today and I noticed something terribly funny: in the regional categories, the story was filed under Canada! Haha.

Civilizational Cyber-Lethargy

File under ‘generally irrelevant to the general thrust of this blog,’ there’s a neat article in the Brisbane Times about the probably eventuality of totally immersive virtual realities (like holodecks of Star Trek fame or the matrix from The Matrix), and its social/societal implications.

The main question is of course that, if once entered, would we ever reemerge? I’d like to think that we humans would prefer existing in the physical reality of meatspace, even if it’s perceptually identical to a virtual reality, if only because reality is, well, real. Sadly, my intuition says ‘absolutely not.’

Other variations of this theme exist; most famous is a theory by Nick Bostrom (a philosopher at Oxford), who offers the possibility that we may be already living in a giant simulation. And even if we aren’t, then the rapid pace of computing power will allow us all to do just that within only a few centuries or, by some estimates, decades. Unfortunately, there’s a very legitimate possibility/probability that this will be a very big issue for our progeny.

Unfortunately, these hypotheses eerily explain a great deal about why we haven’t detected a peep of extraterrestrial intelligent life, despite what some say is its overwhelming statistical probability. Most commonly known as the Fermi Paradox - if it’s so darn likely, why ain’t we heard nothin? - the idea that an intelligent life self-destructs from civilizational cyber-lethargy seems a lot more likely than burying itself in nuclear weapons or all getting hit by giant meteors. Of course, there is just the possibility that humanity really is super duper unique, which is kind of an accidental nod to religious folk who take the great silence as proof of human exceptionalism by the divine.

It’s all speculative now, and generally restricted to the geekosphere, but its emergence as a legitimate question of public policy shouldn’t really be ignored either.

Hat Tip: Instapundit.

Gas Prices, Cont’d

Just to underscore what I was saying about adjusting habits in the face of increased gas prices, a friend pointed out a recent NYT article on that very topic [free reg. req'd].

Mass transit systems around the country are seeing standing-room-only crowds on bus lines where seats were once easy to come by. Parking lots at many bus and light rail stations are suddenly overflowing, with commuters in some towns risking a ticket or tow by parking on nearby grassy areas and in vacant lots.

“In almost every transit system I talk to, we’re seeing very high rates of growth the last few months,” said William Millar, president of the American Public Transportation Association.

“It’s very clear that a significant portion of the increase in transit use is directly caused by people who are looking for alternatives to paying $3.50 a gallon for gas.”

The market reacts! As another friend pointed out today, however, it’s a pity that this is only just catching on now.

Hat Tip: Ethan Jewett.

Gas Tax Holiday from Reality

For those of use not living under a rock for the past few months, we are all quite aware of both Senator McCain and Senator Clinton’s promises, should they be elected (one at a time, folks), that they would push for a temporary gas tax holiday. The idea, of course, is to offset the meteorically rising costs at the pump so that people can enjoy their summers in a manner as close to what used to be normal as possible.

As a consumer, and someone who enjoys driving probably as much as any revving, fist-waving, windows-down American, it’s a nice thought. And in all practical terms, it could very well be a real attempt - beyond charges of base political pandering - to give American consumers what little reprieve possible.

But that doesn’t change the fact that it’s a poor, poor idea. As someone who has bemoaned the externalities of cheap gasoline many a time, I can’t say that the idea of the government rigging policy to reduce prices temporarily is desirable. Let’s face it - the era of cheap gas is coming to a close, and it’s well past time for us to readjust accordingly. That doesn’t mean a Prius in every garage, but actually reforming the predominant land-use configuration of this country congruent with the realities of the market. In other words, we need to wean off automobile dependence. It won’t be easy, and it won’t be cheap, but it might very well be the most economical, pragmatic avenue (no pun intended) for us to take. And the market is already reacting accordingly - perhaps not as quickly as some of us would like - but it’s happening; from the increasing popularity of public transit and transit oriented developments to changing car habits, consumers are doing what they can to adjust to the changing conditions, as should have been expected. We may not be rational creatures, but a society can make freakishly rational decisions when it comes to their pocketbooks.

To this end, any effort by the government to artificially reduce the costs of gasoline will only push back the timetable for much-needed reform that is better to happen sooner rather than later. Moreover, as an open letter by some 200 economists indicate, castrating the federal gas tax is tantamount to trashing much needed revenue streams to maintain existing highway infrastructure, much of it badly in need of maintenance. It’s simply poor public policy.

In the spirit of open mindedness, however, I am willing to concede this: even if it may be deleterious in the long term, we should not discount just how popular this idea could be. Any relief from skyrocketing prices will immediately benefit the millions of Americans whose livelihood depends on that gas guzzler, or who don’t have reliable access to public transportation (if at all). Even if land use configurations begin to change, it’s certainly not something that can be fixed overnight. There are many people who need help now.

But it doesn’t change the reality. For all we know, gas prices may overtake the canceled tax margin before it makes any difference anyway. Either way, people are going to suffer, and it’s best to get through it now rather than wait around for a miracle in energy prospecting that’s not likely to happen. What SHOULD happen, however, is that money be increasingly appropriated to public transportation projects instead of our continued insistence on road building; make no mistake, even with prices like they are, there are still hundreds - probably thousands - of road-building and expansion plans to be paid for with federal dollars. I say these need to be immediately reviewed against the context of, well, this brand new context.

A Few Things

First, sorry that I haven’t posted in a good while. I’d like to blame the fact that I’m busy (and I am), but I found time to do it before. I think between finals, a high-tempo work and commuting schedule, and fruitless weekend excursions to New York, I’ve neglected to write even though it’s been bearing on my mind just how much I needed to post something.

And it’s been a pretty crazy last few weeks between the Democratic Primary (I don’t think I need to add anything to the gallons of ink already spilled), global food shortages (one sec), and this terrible natural disaster in Burma.

Real quick note about Burma: initial casualty estimates were in the low thousands, then the tens of thousands, and now we have some reports suggesting that as many as a half million people may have died in the cyclone. Now, it shouldn’t be a surprise to any casual observer that the military junta in ‘Myanmar’ unloads a great plenty of misery and brutality well-enough without the assistance of catastrophic natural events, but neither should it be surprising that it’s even less able to control the situation in the event of such things. Whatever the final death toll, so many people need not have died. The insularity and repressive inefficiency of the Burmese government, at the end of the day, is chiefly responsible for the fallout from this disaster, and even more so given that they have been very, VERY slow to accept international aid. As we speak, and from the very beginning, US naval assets have been standing by ready to move in and begin a massive humanitarian campaign to assist the tens of thousands of people in need of assistance. But, of course, the Burmese government is more worried about maintaining its ugly grip on power than helping see its people through this crisis. Again, no surprises there.

What we should expect, however, is that the awkward two-stepping by the Burmese military regime may weaken their hold on power as never before. Could there be some kind - any kind - of silver lining from this madness? It seems that it’s the best we can hope for.

This isn’t the only point of difficulty in East Asia. Among other things, Asia has been hit the hardest - though certainly not exclusively - by the dramatic rise in food prices. As Derek Murdock has so clearly articulated, this issue lies chiefly at the feet of the US and European governments, whose insistence on ethical posturing has overwhelmed the practicality of keeping people fed. Ethanol subsidies have clearly been a disaster; even if ethanol is part of the solution, the demand-side bumbling by the developed world has sabotaged global food markets, perhaps irreparably. This should make us furious. This, my friends, is what happens when the government’s pompous mandarins believe it can somehow do a better job distributing goods than the market. And they are horribly wrong, and now people are paying for our arrogance.

In other news, Paul Krugman must have been sad to learn that we’re not yet in a recession. At least, he should be, since he has predicted a recession for almost every quarter since 2003; realistically, he’s probably unfazed and banking on Q2. But, he’s wrong now, and there’s compelling evidence to suggest he’ll be wrong then too, along with his sanctimonious cadre of perennial naysayers.

A friend of mine, upon hearing the news, could hardly believe her ears. How can you blame her? The media has been feeding dire predictions of doom for months, and for it to not come to pass seems almost surreal. This, I think, defines political economy.

BBC Blown Away by Post-Keynesian Economics

From the Beeb: Low Taxes ‘Boost Public Sector’

Hah!

Bolt for a Buck

I’m on my way to New York City (THE City, as it turns out), and I decided to be a little unconventional this time and take a new busline, called BoltBus. I saw the advertisement, well, on the side of one of their buses on the highway with their slogan “Bolt for a Buck.”

Doing anything for cheap - especially 1 dollar! - is an irresistible temptation for me, so for my weekend trip to the City, I decided to go ahead and book myself a round trip ticket. Sure enough, I paid $2 (plus a $0.50 ‘transaction fee.’) online and printed out my materials from my computer.

And here I am, RIGHT NOW, sitting on their bus on my way to the City, and using their free wireless internet on board. Is this not awesome? My laptop is plugged into a jack on the back of the seat, and I’m happily blogging away as I pass the imperious Philadelphia skyline. Bus is clean, staff is friendly, and it has wireless!

Unfortunately for most of you dirtbags, Bolt only operates between DC, Philly, NYC, and Boston; great news for me, but not so much for the 3/4 of the US population not in that area. And, as it turns out, not ALL their fares will be $1, but it looks like it should still be cheap. I think Bolt, which is a subsidiary of Greyhound, is trying to compete head-to-head with these Chinatown buses (which I usually take) that have been cleaning their clocks the last few years. They’re off to a good start!

I mean, honestly, how do you beat free wireless? Oh, capitalism, how I love thee.

Confederate History Month

Jon Henke, guest blogging for Megan McArdle, has a very interesting post on her Atlantic Monthly blog, discussing the controversies surrounding Confederate History Month (April) and, inevitably the nature of the Confederate ‘battle flag’ (popularized, ex post facto) that still flies rather ubiquitously in certain areas in the American South. It’s an understatement to say that talking about this opens up a big, fat can ‘o worms, but, as we all know, I enjoy worms with horseradish and ketchup.

Henke ends up trying to take something of a ‘third way’ position, both recognizing the non-racial symbolism that the flag enjoys to many people and the great offense to others. Of course, this manages to ruffle the feathers of both sides, although I think the kernel of his argument is entirely sound.

Most Southerners have a relationship with the Confederate flag that has nothing whatsoever to do with slavery. Over many years, it gradually became a symbol of regional identification, pride and, yes, rebellion. But rebellion in the sense of “James Dean” rather than “secession”. This is exacerbated by the condescending, antagonizing way in which southerners are treated by outsiders, including the media and politicians.

Still, in the end he recommends that detractors take a chill pill, and that Southerners find another way to celebrate their regional nationalism. Oops.

I see the logic of the argument, but I’m of the firm and full belief that the burden for change remains with the accusers; people shouldn’t have to abandon their symbols because someone else merely finds it offensive. To be sure, a little care goes a long way (as my father always told me after breaking a dish), but in every symbol is the propensity for dealing offense. Islam’s crescent certainly offends some people - both reasonably and unreasonably - and so does the Christian Cross, but I haven’t heard much about asking Muslims or Christians to do away with those symbols because of misdeeds done under its banner (though I think I have heard that said about Judaism, unfortunately). I think the most difficult obstacle, in reality, is almost entirely cultural. Since southern, white culture seems to be the last demographic of acceptable prejudice and scorn, there’s really very little impetus among many to reevaluate the South when generalizations and stereotypes are perpetuated ad nauseam.

What many don’t understand is that many Southerners are not only proud of their culture, but have reason to be. Unlike the caricatures, the South is not a cultural wasteland; I always find it ironic that the same people will pooh-pooh Country Music and Bluegrass - Southern musical styles directly descended from Scotch-Irish folk music - while endlessly celebrating one foreign ‘indigenous’ musical style after another.

But, make no mistake, though Confederate history for some might be about racism and chattel slavery, for far more its meant to celebrate a proud - if flawed - and able people of the land, who saw their rebellion as being a fight for freedom, as a defense of their land, and very nearly succeeded. Let’s be frank: the Confederacy fought to preserve slavery. However, that statement’s gravity obscures a complex picture of a culture that believed in so much more. And today, as we see the South and southwest race ahead of the rest of the country economically, it’s worth noting that to underestimate the South comes at some peril.

So, I say, let’s let the South celebrate their heritage, because it is indeed worth celebrating -and- they absolutely have nothing close to a monopoly on racism and prejudice in this country. The Confederacy isn’t merely an organization of stubborn bigotry so many years ago, but today represents a continuing narrative - of the good and bad - of an amazing, distinctive part of the world as diverse as any (and more than most) and full of undeniable culture.

Oil and Creative Destruction

The other day, as I was walking into work at the Labor & Industry building in Harrisburg, I was startled by the sounds of dozens (hundreds?) of big-rig trucks circling the capitol complex, ensnarling the whole area in massive gridlock and collectively drowning the entire area with the screams of their horns. What was going on? I wondered. My answer was affixed to many of the trucks - signs protesting the meteoric rise of gas prices (diesel, in particular), and the crunch it was having on truckers, independent operators in particular.

As the protest convoy circled the block, about 100 people gathered on the Capitol steps to urge state lawmakers and Gov. Ed Rendell to eliminate Pennsylvania’s highest-in-the-nation diesel fuel tax of 38.1 cents per gallon.
Consumers also pay state taxes of 32.3 cents per gallon on gasoline, 11th highest in the nation.

Of course, high taxes certainly don’t help, and 38 cents a gallon is no joke - it’s a huge margin - but relatively insignificant compared to the trajectory of fuel prices over the last few years. Even if Pennsylvania canceled the levy today, there’s no guarantee that commodity prices for fuel won’t jump that level in the short to medium term.

Of possibly greater consequence than the combined Pennsylvania and Federal taxes is the new regulatory regime, which began in 2006, mandating that all diesel sold in the United States conform to ULSD environmental requirements, which has had a significant effect on the price of diesel. While it surely reduces particulate emissions, it’s really placed the trucking industry as a whole under significant strain.

While blame for high fuel prices has been laid at the feet of state and federal legislators to some degree, the most pervasive scapegoat as of late has been energy companies, who have been accused of price-gouging and “stealin’ from the middle class” and torturing puppies and the like. Of course, this this all patent nonsense. Oil is a fungible commodity, and its price is dictated not so much by petroleum robber barons as levels of supply, demand, and all the minutiae in between. If there’s any specific party that can be blamed for high prices, it’s OPEC, who has refused to increase supply despite historically high price levels. But make no mistake, its rapid industrialization in emerging markets - causing a spike in demand - that’s the real culprit.

As I looked at those lines of desperate truckers, I began to wonder if I was seeing the early, observable signs of creative destruction. Indeed, as the high cost of oil - an inevitability - makes disparate cargo transport options increasingly infeasible; in general, an 18 wheeler increasingly just doesn’t move enough cargo for cheaply enough, a phenomenon which will either force massive energy-saving transportation innovations (hybrid big rigs?) or squeeze the trucking industry out entirely. Or, as might be more likely, a combination of many of these things.

What would the twilight of trucking yield? For some, the answer lies not in futuristic gizmos, but in a familiar face: trains. As the cost of moving freight by truck becomes prohibitive, might we see trains experience a renaissance? It remains to be seen, but the advantages are obvious. In a January 2008 article from David Warsh, he reviews an interesting book by John Stilgoe, who predicts trains as the next big thing. In the article he writes:

What will drive the change? Rising fuel costs and intractable highway congestion, Stilgoe says. He barely mentions global warming — that goes beyond the scope of the “scenario analysis” he favors, at least for now, but of course if it begins to take on the atmosphere of crisis it will be the single biggest factor in accelerating the changes that he expects. Railroad locomotives account for just 1 percent of national oil consumption. Electrification permits faster acceleration and braking, and so lets more trains operate in a given space; electric locomotives pull more, require less maintenance and pollute very little. The demand for fast and clean electric trains will increase the attractiveness of nuclear power.

Naturally, the externalities produced by this change won’t be small. In a sense, cheap oil and the mobility it supported in trucks is what really catapulted American industry to the immense levels it is today; but as those days end, our habits in business, transportation, land use, and so many other things will inevitably change.

Is it the end of the truck? It’s too soon to tell, but if current trajectories are any indicator, the future is certain to look a lot different than the business-as-usual of the past 100 years.