Getting Dirty: Politics

I have long hesitated to spend much time & space on political topics. My original inclination with Sustainable Frederick has been to target issues that are under-represented in media, not to mention that are less divisive. I may be able to avoid national politics, but at least on the local level I've come to accept that it is naive and even negligent for me to pretend there is no elephant in this room. I hope I don't alienate -- and therefore lose the ability to influence and inform -- those who will reflexively dismiss what I write when they begin to suspect I am not on their political team, but there is no time to be timid.

So here goes -- my first political salvo:

In broad terms, sustainability requires democracy. Further, sustainability requires a government that sticks its nose right into the issues of resource use.

This is really the sticking point: conservatives tend to want little or no government. They argue that any government is a slippery slope to tyranny, and besides the economy works better and more efficiently without government busybodies getting in our business.

I felt that way once, myself -- in college as a recently declared economics major I was in love with the idea of the free market unfettered by government regulation. Who can argue that capitalism and the relatively free market provides tremendous social benefit through innovation and through the individuals raising themselves up to reap the gains of opportunity? With that in mind, my naive student self argued that businesses wouldn't pollute the Earth knowingly, because then they would face increasing costs as the labor pool sickened. I argued that because rational people agree that an economy that systematically disenfranchises the poor is inherently unstable, then who wouldn't be in favor of a progressive system that provides opportunity to all?

Well, I still believe that the innovation and motivation that are inherent in a capitalist system are among the most potent potential forces for good on Earth. Now, however, I also understand what is known as the Tragedy of the Commons. In short, the tragedy of the commons is a metaphor that describes how people tend to shortsightedly eat up and ultimately destroy all of the value of "public goods" such as clean air and water.

See, the polluting company won't face costs associated with a sick labor force for years, and investors in the form of shareholders only care about this quarter. The company will move its production to China and investors will be long gone to other stocks, bonds and god knows what else long before any accountants post the costs of polluting the environment to any income statement. And while rational people may desire the stable economy that comes with economic equity, they would just as soon take the money and run off to some fortress playground of the rich.

Here in Frederick County, we want individuals and businesses to develop the land so that people gather what value we can from our most precious resource. What we don't want is for the land to be developed such that it loses the unique and irreplaceable value of the land itself. Imagine Frederick County looking like the sprawly parts of Montgomery County, or even worse like the fully sprawled Prince Williams County, VA? We don't want that.

And so we need our representative government to help us sustainably administer the land development process. We need public servants to work with and for us to protect our land from the devils of our worst nature who want to suck the blood of the Earth and turn it into gold in their pockets.

Looking for an Argument
I hope there exists someone out there that sees these issues differently and is willing to share. I would like nothing better than to have people who support less fettered land development to help us understand what sustainability looks like to them. If you know any who works to maximize the profits to be made by turning Frederick County into one large swath of ugly houses, or politicians who want to help them -- please send them this post and ask them to get in touch.

As 2010 progresses, I will be looking into how the candidates for County Commissioner see this issue.

Healthy capitalism: neither reality or myth

The difference between the ideal of sustainability and traditional environmentalism is the explicit inclusion of the goals of a sustainable economy and community. I believe a sustainable economy is a growing economy -- it just has to grow in a healthy manner. We are so far from that ideal that its easy to doubt that an economy can grow in a healthy manner -- but it can.

This opinion piece is not great, but I like some of the points it makes:

-- The main point is to argue against an idea that is apparently getting some traction in Europe; that it is possible and desirable to achieve an economy that is stable and does not grow. The author doesn't really make a decent argument against the idea -- he just invokes the faith that innovation, regulation, efficiency and behavior change can overcome the criticisms made by no growth-ers. I happen to have the same faith; though for me its more of a hope. I'm not at all sure we humans have what it takes to find the right balances we need.

-- The author pins some hope on genetically modified (gm) foods. This is a tough one. I am unwilling to support or attack the idea of gm foods on principle, because the potential upside is so huge. The problem is that the downside is just as huge. On some levels, watching genetic engineering appear and grow as a practice feels like it must have to know that the atom was just about to be split for the first time; it's just another way we can destroy the planet and ourselves.

-- I like that the author concedes that "there's something to these critiques." First of all, GDP is a bad metric or prosperity. Using GDP to measure growth assumes every dollar spent is a good thing, and everything dollar not spent (e.g., volunteering, non-tax deductible charity, backyard gardening) is a bad thing. We know that it is not a good thing to spend money buying refrigerators that leak CFCs and to purchase goods made with exploited labor. Consider that our GDP grows if we go out and spend money on gasoline that we dump straight down the drain.

-- The other point the author concedes is that capitalism can have significant negative effects in peoples' lives, including stress, nervous depression, cardiovascular disease, and cancer. I'd suggest this list of capitalism's ills is much too short; it should definitely address the fact that unfettered capitalism increases inequity -- that is the economic distance between the haves and the have nots. Still, let's not throw out the baby with the bath water.

-- If we are to judge capitalism harshly for its ill effects, we have to remember the benefits we have gained over the last few hundred years. Without an economy that rewards growth, we wouldn't be having this conversation and our breath would be really bad while we didn't have it. What we now consider minor injuries would be lethal, and we'd never have seen this:

Bumper Sticker Alert: Drill, Daby, Drill.

Bumper stickers just might be evil.

Of course I see some with which I agree, and many that make me laugh. But we can never let ourselves forget that putting a slogan on our car is NOT the same thing as communicating. What bumper stickers do, in effect, is identify you as part of a team -- which draws a line between you and their team. There are times for teams, and public dialogue is not really one of them. Once that line is drawn, something funny happens in our brains: we choose sides. It's automatic and unconscious. Again, there are times for sides, but finding understanding isn't one of them.

I'm starting a recurring segment: Bumper Sticker Alert. I'll try to tackle BSs from both sides, as both sides are equally likely to be foolish. But don't be surprised if most are on the "conservative" side, for the simplistic reason that conservatives are more likely to argue against change.

Anyway, today's BS:

Drill Here, Drill Now, Pay Less.

First, my emotional response which largely mirrors the greenies' response: if we know oil is ultimately a big part of the problem we face in the world -- why should we work so hard to get more of it out to pollute the world?

Of course, the economic reality is that oil runs our machines and non-oil machines are not yet near. The sad fact is that we'll need to keep drilling and burning oil while we work to turn this ship around (let's just try to systematically reduce our usage and increase our efficiency as we work on those green machines).

So, as time rushes us forward we'll probably eventually get at that approximately 19 billion barrels underneath the arctic and off the U.S. shores. I don't like it, and I'll drag my feet, but I suspect it will happen.

The reason I would yield -- that is, raise my dragging feet, is NOT because of the argument behind this idiotic sticker. The simple fact is that drilling here anytime will not effect our prices one bit. Understand this -- global oil consumption is currently running somewhere around 80 billion barrels a day. Every day. So, if we get jiggy and drill baby drill right now, we'll add 19 billion barrels of oil to the global market over the next 25 years.

Do you understand the idea of supply and demand and how it determines price? Does it make sense that if the current quantities demanded and supplied net out to 80 billion barrels per day at a given price, then adding some fraction of 19 billion of oil to that supply, the prices will not go down.

Do you think you can grow a bushel of tomatoes for sale and expect them to drop the price that grocery stores charge?

Consider the oil companies who will invest whatever they invest to get at that oil. When it starts pumping out of their refineries, do you think they will check out the current global prices and charge less for their oil? Why, because they love America? Get real.

My suggestion for drilling in ANWR and other sensitive areas: sell extraction leases (for a bazillion dollars) and place environmental restrictions to protect the local environment that are so rigorous, and therefore expensive, that no oil company can sell it for less than triple the current global price of oil. Don't worry, oil company -- as global oil reserves dwindle, that oil will become more and more valuable, and can therefore be priced high enough to cover the high costs.

Eventually, it will make economic sense to drill.

The Big Squeeze. Where do we go from here?

Part of success -- with sustainability like everything else -- is staying engaged even when there seems to be no answer. When things get really hard, its easy to let your mind step back from the problem and kind of give up. It's very frustrating to have no answer while the problem stares you in the face. It feels like something has to give -- its just not going to be the unsolved problem.

It's times like these that people disengage -- and it's times like these we can't disengage, or we lose. This is the lesson we learn when we see real life heroes doing the mundane heroic work of raising their children, of getting the job done, of continuing the conversation even when every cell in the body wants to scream, holler and leave.

Here are two sides of one of those frustrating impasses: farms and farming vs. the growth and development of Frederick County.



This article by Ike Wilson in the Frederick News Post captures some of the issues that might be best summed up by the opening line, "A merger of city dwellers with rural living continues to impose problems for agriculture..."

Development has put the squeeze on our farmland, and Wilson touches on several of the conflict points. I suggest you read it and understand that this conflict won't go away until it's solved. Sit with the tension.

Here are a few points I don't think get made well enough in our stilted public dialogue:

--- Our population is growing and everytime we put in a new toilet or sink we are adding burden to our over-burdened wastewater system, which in turn burdens the Chesapake Bay with death. Maryland and the U.S. EPA are very industrious when it comes to regulating farms, but they are not so industrious when it comes to asking all those builders and flushers to carry their fair burden.

-- Economies of scale are forcing farmers to expand into what are known as Concentrated Animal Feeding Operation -- CAFOs. With regard to pollution, CAFOs are like farms on steroids. But to a farmer trying to run a business, scaling up is one of few options.

-- Many people from urban backgrounds want to live in the country and many from rural areas want to live nearer to work. This should be a strength for Frederick County! People want to live here and whether they know it or not they want to preserve the natural and agricultural aesthetic of our land. (Slipping into a mini-rant: I just wish these suburbanites who fancy themselves nature lovers would preserve our natural aesthetic, instead of living in ugly developments that seem to sprout like cancerous weeds on our hills and dales. I also want them to understand that living in the semi-rural comes with the earthy reality of living next to farms. Oh, and one more thing -- what are these folks going to do when their ugly development is surrounded by 50 other ugly developments? Move to Pennsylvania or West Virgina and muck them up, I guess.)

We need farms. We need land on which people can live. Neither of these facts are going to change. Stay engaged. Don't give up.

Ice Water in Boomers' veins

According to David Ignatius of the WashingtonPost, the typical boomer -- born between 1945-1965 -- was looking at a pretty lean retirement even before the stock market's dive off the cliff.

Stat 1: 53 percent of households that hold at least one retirement account, the median combined balance was a mere $45,000. But that includes younger households, so let's look at...

Stat 2: ...households headed by persons between the ages of 55 and 64, the median value of all retirement accounts was just $100,000. (That would buy an annuity that would pay a paltry $700 a month for life, based on current interest rates.)

This is not a demographic that has proven to be particularly willing to suffer a fly in their latte.

It's going to be interesting.


(Photo courtesy of SkiGB.com)

The Price isn't Right

Here at Sustainable Frederick, we believe in the mostly free market. There is no doubt that a market economy is among the most amazing inventions in the universe. Let's take a minute to admire it.

Milton Friedman is the famous classical economist that is most associated with touting the amazing benefits of the free market.

Friedman talks about the simple pencil and the important point that no one person or organization could plan to gather the resources -- wood, graphite, rubber, metal, paint and labor -- from around the world and put them together into a pencil that costs only pennies. It happens so cheaply because markets exist where sellers of those resources meet buyers and exchange the goods for money and everyone walks away happy. Here is the video -- its worth seeing because this idea is (was) truly revolutionary.



Friedman and his ilk contend that the one true evil in this scenario is regulation. Only by mucking around with rules can we diminish the magic of the market.

Oh, the idealist! Really, right wingers always talk about lefties living in a fantasy world, hanging on to unreal and insubstantial dreams that look good but aren't realistic. The problem I see is that these folks are the one's living in fantasy world.

Going back to the pencil, do you think that the company that clears the forest to extract the wood to sell to the pencil maker is paying the true costs of the wood? Sure, that company is paying the labor something (we won't even get into the topic of a fair wage here), and is paying for the oil that runs the chain saws and trucks and stuff, and is paying an accountant to track it all. That's the part of the system that works. But, that company is not paying the local population for the fact that their water is now polluted because it is NOT being filtered by the wood that is now a pencil and no longer a tree. That cost falls to the poor individuals who get sick, the local government, and international aid agencies (who get most of their money from us, by the way).

Eventually those costs cost someone a lot of money, but the pencil was used up years ago.

I was inspired to write this post by an op-ed in the TheWashingtonPost that makes this same case regarding the comparison of green energy and oil energy. Check it out.

Finally -- I am listing Friedman among my heroes of this blog for his theorizing that has inspired as much good as bad. That's sustainability.

A Sustainable Global Population?

In his April 5, 2009 New York Times column, Nicholas Kristof talks about the increasing need for more effective family planning activities in developing nations -- his example is a woman from Haiti. I'm posting the link because we should remember that an ever growing global population is as dire a challenge as any we have ever faced.

I also think this issue serves as a great model for understanding sustainability. A great deal of the column addresses the promise and challenge of effective contraception and counseling; it isn't until the end that we learn that the sustainable solution is economic stability and growth, or as Kristof put it "There’s abundant evidence that when parents are confident that their children will live, they will have fewer and invest more in each of them."

"...are confident that their children will live..." How's that for a little cold water in the face.

Effective contraception can put a little pause in population growth for a bit, but it will take the forming of a solid economy for a real change in trends. Similarly, there are lots of things we can do to minimize the damage we cause now, like recycling or driving a more fuel efficient car and driving much less, but it will take a new economy to start resembling sustainability.

Hope gets going.

In You Want Hope..., I discuss the hope that the market for green technologies will finally get off the ground and that at some point we'll actually have renewable energy that is competitive in price with fossil fuels.

The next part of the story is how things really get going.

But first, can I suggest you just ignore it when some bozo claims energy efficiency and reduction in fossil fuel use will hurt the economy, because the opposite is true.

Now, consider this: if we work to generate cleaner power and learn to be increasingly efficient, we will develop skills -- a national creation of knowledge -- that will provide a new competitive advantage (a sustainable one!). Just one example benefit: if our energy costs less and we use it more efficiently, we will attract investment because energy intensive industries like steel and cement production will find it profitable to locate facilities here near the cheaper power and more knowledgeable energy efficiency experts.

Imagine that! Foreign capital invested in the U.S manufacturing industry! It'd be like a do-over for what we should have done in the 70s and '80s.

It's called First Mover strategy. If a company (or nation) is the the first to exploit a market innovation, it will get to the lower costs from economies of scale while everyone else still faces the higher costs. That means we get time to keep refining the technology while others are just trying to adopt it. It's like getting a power boost that jumps us ahead of other nations and renders petro-dictatorships increasingly neutered.

The nation that gets closest to a sustainable economy first will have an economy in overdrive, maybe even warp-drive.

You want hope? I got hope for you right here, baby!

I was speaking about green technology with a technically savvy friend the other day and he made a comment that gets right to the bottom line, "Electricity is so cheap that I just don't understand how green technologies will get going. Because they are so expensive to buy, it really isn't cheaper to install and use most of these technologies in your house or business." (paraphrased)

This is where we are now. Fossil fuels are very cheap and green technologies are expensive to install. How do we get to sustainability from here? There are two dynamics that offer the hope we need.

Reason for Hope #1
First, you need to understand the idea of economies of scale. Imagine building a car from near scratch in your garage -- you have to cut and shape metal and install and assemble and whatever else to build the car you will drive. Imagine the machinery and tools you will need. Imagine that you'll have to find a store that sells you the materials to make one engine, one transmission, etc. Now think of good old Henry Ford who showed us why its a good idea to make 1000 at a time instead one just one. That's economies of scale -- as systems are built to produce large quantities of a good, it get's cheaper and cheaper to produce them.

The way things are now, economies of scale have been hard at work making the use of fossil fuels cheaper for centuries. Business has invested uncountable tons of cash in learning how to get every penny it can out of fossil fuel which is part of why they are cheaper than green.

Green engineers and business people talk about the need to get "up to scale" on green technologies, which means we need to get to a point where we are making and using green technology at the scale necessary to get the costs down to comparable levels with the fossil fuels. That has been a hard row to hoe mainly because few with lots of money have wanted to invest it in technology that competes with higher value investments. (Food for thought: if you had invested billions in oil, would you want a green revolution before you got your payback on your investment?)

Now, with the economy faltering and the political cost of our addiction to oil is starting to be recognized and with our recent price shock of $4.00+ gasoline, we have some reason to hope that this is the time when the will exists to invest sufficiently in green technology.

Reason for Hope #2
The second dynamic that gives me hope is that wind & sunlight are free and they always will be. Free. As humans, we kind of act like things are free -- if we live near a forest we get the wood, if near a river we get the water -- but they really aren't. From the you-don't-know-what-you-got-til-its-gone file: it is when those resources get used up that we start to realize they actually had value. (Scary thought: Imagine how expensive water will be in 50 years. Imagine countries at war over access to water. It will happen.)

The world is going to run out of oil some day -- most experts think we are about half way through all of the oil on the planet -- and since oil will become increasingly expensive until its gone, renewable energy will become increasingly relatively cheap.

The magic of sustainability is that these things make good economic AND environmental sense. That is where we can find hope.


p.s. If you want to make a pretty small investment in green technology in a way that can really save your family or business money, install solar powered hot water heaters to supplement or replace your electrical unit. My tech savvy friend tells me that this is one application that truly pays for itself in less than 5 years.

Is it real? (subtitle: Not as boring as that chart looks!)

If you are in a college level Economics course, you will learn that a market has producers and consumers and supply and demand. This will make pretty good sense and it is well worth learning. Economists have created models of markets that help them and us understand what goes on in the real world. As you learn more about the study of economics, though, you will start to notice a tendency to kind of gloss over real world information that doesn't fit into the model.

Ceteris Paribus, or "all other things being equal" is the glossing over that happens at the onset of the model creation. You see, if the world is kind of messy and keeps changing and people don't always act rationally (whatever that means) then its hard to create a good model. That's when you say, "Well -- let's talk about what we want to talk about and pretend everything else stays the same so we can ignore it while we build the prettiest possible model."

Economists take a lot of grief for ceteris paribus, and not all of it is fair. It's the externalities that really get my goat, though.

Once an economist builds a model, they set to watching it work in all its largely imagined glory. If someone taps them on the shoulder and asks about its implications on the real world, the economist will probably wave them away and tell them that real world implications are called externalities, which basically means they can be ignored.

Externalities that tend to be ignored by economists include things like pollution, public health, crime, and loss of species. To be fair to economists, they use terms like ceteris paribus and externalities because they are in the classroom working on a chalk board and the chalk board would get awfully crowded and hard to read if every relevant factor were fully addressed. The problem is, though, that they are teaching future business people who pay all sorts of attention to marginal costs and the price elasticity of demand and get quickly too busy to pay any attention at all to anything else.

If you like your pretty model of the U.S. energy market, you might be tempted to ignore the externality of pollution until your very own Erin Brockovitch steps up and reminds you that its the real world the rest of us are watching while you watch your model.

While we have all been watching the most successful economic model in history churn along and make us all rich and fat while the mother of all externalities -- our planet and its ability to sustain a biosphere -- has occasionally tapped us on the shoulder. When we get that tap -- as we have been re: gasoline prices and as we have in another way re: leveraging (aka mortgaging) our futures -- we shudder and sweat and think maybe we should take a closer look at how we do things until we remember that we aren't supposed to worry about it because its not part of the model we prefer.

Charity and Economy begin at home

The economy of an area -- in this case the Frederick area -- consists basically of what the community of the area produces and consumes plus money flowing in and minus money flowing out. There is miles of gray between these blacks and whites, but it works as a basic model.

Of course, we should first recognize that from most economists' perspective, we are really just kind of a slow moving side side show of the Baltimore Washington Area economy. The reason they see us that way is that our economy, like the whole area, is largely driven by U.S. Government money.

That's true and I see it differently -- I think Frederick has a distinct enough economic identity that we should seek to grow how we want to grow, as opposed to us becoming just another extension of DC and the East Coast sprawl. We have unique natural, economic and community resources that deserve local stewardship.

Still, let's be honest, we do depend economically on the Federal government -- at least as an employer of so many people, but also because of the spending the Feds do on construction and rent other locally provided services. So we are part of that larger economic area, and it is to our benefit as much as we might think or pretend otherwise.

So the Frederick economy has inflows of money from the Federal Government. We export -- in that the work is done here and someone not from here pays for it -- some biotech and some professional services, some agricultural products, some building and development services, and little bits of this and that.

Our money leaves our economy when we buy things brought here from somewhere else.

It's generally true that the more money we bring in from elsewhere, and the more we spend on goods and services produced right here, the healthier our economy will be. Don't get me wrong, I am happy we live in a global economy where I can get coffee, for example, from across the world. I believe the globalization of the economy is a good thing, by and large and if we don't screw it up.

Still, home is home. The closer our money stays to home, the better for all of us.



p.s. Look what great work the Frederick County Office of Economic Development is doing.

$0.13 from every dollar you spend on gas goes straight to Osama Bin Laden!

Think about that for a minute.

OK, for the record, I don't know how exactly much of our money gets to bin Laden. I made up the 13 cents because I can't find that specific analysis. Its a useful placeholder though, because there is no doubt whatsoever that a huge amount of the money we pay for oil ends up in the control of terrorists and also undemocratic dictators like Hugo Chavez and Putin's Cabal.

Thomas Friedman's Hot, Flat & Crowded breaks this down for us. A few highlights:

• Saudi Arabia is set to earn around $200 billion dollars in oil money in 2008, and Saudi interests have tens of millions of those dollars building thousands of mosques and hiring teachers to spread the most extreme form of anti-western Islam in Pakistand and Afghanistan.
• Iran, which is OPEC's 2nd largest oil producer aggressively finances terrorist groups including the Lebanese group Hezbollah. When Hezbollah launched war against Israel in 2006, Iran gave Hezbollah $3 billion-plus for payouts to Lebanese citizens during and after the conflict.
  
• Almost 50% of foreign insurgents in Iraq have been recruited by extremist Saudis and sent to join the battle carrying thousands of dollars to help finance operations.

There is more and I hope you remember that your pennies and dollars that go in your gas tank don't stop there. They go into the accounts of faceless corporations who have no qualms at handing them over to dictators who are exploiting the land and people who could benefit from an economy that does more than produce oil. Those dictators do many bad things with what is now their money, including paying people to kill themselves to take a few or a lot of Americans with them. Women around the world are being stoned to death and worse because dictators with lots of money tend to stay in power and tend to become increasingly intolerant. Children are denied education in anything but extreme Islam, which ensures they will never be able to progress economically and will therefore always be vulnerable to militant recruiters.

So, every time we fill our gas tanks, we should acknowledge to ourselves that in that act we are in fact sending some of our money to our enemies. Maybe if we remember that every time, we'll start deciding fuel efficiency really does matter even when the price of gas is relatively low.



p.s. Let me note from the "People are Stupid" file that in December '08 as gas prices dropped, Americans bought more trucks and SUVs than cars for the first time since February. Do these people really think prices won't go up again?