My story on last week’s press conference is up now at PJMedia.
Category Archives: Business
Memories Of Flint
A few months ago when I was back to visit relatives, I took a drive around, and saw the vast empty field that used to be A.C. Spark Plug, where my father and later my brother (and, during summers in college, I) worked. And when I flew in, I saw from the air the ruins of what used to be Buick City, along the Flint River. It was surreal.
For years, Gordon Young, a Flint native living in San Francisco, has been running a blog that’s become sort of a water cooler for people who are from Flint, Michigan, but not necessarily any longer residents.
As a result of a lot of time spent back there over the past few years, he’s written a new book
And I hope that with the new right-to-work law in Michigan, some of the companies like Honda and Mercedes and others will now consider setting up shop on the old industrial sites, and there can be some semblance of a return to the former glory, even if the new jobs won’t provide the middle-class incomes on unskilled labor that they did in the fifties and sixties. Those days are simply gone, never to return.
[Update a couple minutes later]
Here’s an example post from the blog. 1973 was the year I graduated from High School, into a recession that in Flint was a depression (unemployment was more than twenty percent). The suckitude of the economy, and getting laid off from a job as a mechanic at the VW dealer, inspired me to go back to school, at Mott Community College (named after Charles Stewart Mott, on whose property it was built, and who did die that year, as Gordon notes). In retrospect, that probably was the high point. I moved away three years later, to go to Ann Arbor, and never moved back.
[Update a few minutes later]
Here’s the book’s web site. That reminds me that I should build one for mine.
Why Does The Recovery Continue To Suck?
No, AP, it’s not the technology, stupid:
Technological innovation has always eliminated jobs, a fact for which we should be thankful: our ancestors were brick-makers, arrow fletchers and animal skinners. It has also created wealth, and that wealth has been invested in new ventures, using new technologies, that have created new jobs. This has been true for thousands of years. So what has seemingly changed so suddenly? It seems obvious that in the U.S., the game-changer is metastasizing government spending, much of it wasteful, combined with trillions of dollars in government borrowing and oppressive regulation, which together have suppressed the wealth creation and investment that normally would have created millions of new jobs, along with trillions in new economic output.
In other words, the current recovery is uniquely awful because we have never before had such a left-wing federal government.
Or as large a one.
The Grounding Of The Dreamliner
…is a sign of a threat to innovation:
The Dreamliner’s troubles reflect a wider trend. Innovation in mature economies such as America’s seems stuck in a perpetual holding pattern.
Venture capitalist Peter Thiel has warned about this slowdown for years.
“There is so much incrementalism now,” Thiel said in a recent interview with Bloomberg Businessweek. “Even back in the ’90s there were companies like Amazon that were willing to do big things. That has gone out of fashion now.”
Thiel points to Space Exploration Technologies Corp. and the electric car company Tesla Motors Inc. (TSLA), both run by Elon Musk, as the rare examples of recent attempts to leap forward boldly. Yet Musk often gets portrayed as a quixotic dreamer.
“I think this reflects the insanity of our country, that anything non-incremental is seen as insane,” Thiel says.
Who’s responsible for this perceived downturn in innovation? One obvious target is overweening government. Some Boeing defenders have charged that the FAA wildly overreacted by grounding the Dreamliner.
“They are trying to make us too risk-averse,” says Gordon Bethune, a retired airline executive who worked for Boeing and later ran Continental Airlines. “The FAA is teaching Boeing something. Are we sending the right signals to our innovators in automobiles, airplanes, appliances, that the heavy hand of God is going to come down on you if you have so much as one question wrong in a hundred-question exam?”
Yet an even more important factor than excessive regulation is that the public markets simply don’t reward big risks. While going public theoretically should give companies more access to capital to finance research and development, it turns out that an initial public offering actually tends to discourage bold bets.
More than 20 years of patent citations show that on average in the five years after a company stages an IPO there’s a 40 percent drop in the quality of innovation, says Shai Bernstein, an assistant finance professor at the Stanford Graduate School of Business, who has studied the trend.
I think this is why Elon has backed off on what were originally rumored to be his plans for an IPO this year.
Gee, someone should write a book about the consequences of extreme risk aversion for human spaceflight.
The Makers
How they’re creating a new industrial revolution.
California’s Energy Costs
Banning “Assault” Weapons
How can you do it when they can be printed?
Peak Oil
…has been delayed again:
It’s not clear yet how much oil is recoverable, but even at the low end the field would include as much shale oil as America’s Bakken formation, which has helped transform U.S. energy production and the global energy landscape. If higher estimates prove more accurate, Australia could join the U.S. as one of the world’s top oil producers.
Good news for the world. Bad news for OPEC (and those who want to fund Islamism). And for global-warming hysterics.
How Much Would A Death Star Really Cost?
To the disappointment of thousands who signed the petition, the Obama administration recently informed us that it has, and will have no plans to build a Star-Wars-style death star. Now, there may indeed be good reasons to forgo this addition to the nation’s defense, but the first one listed, that it would cost 850 quadrillion dollars, was based on an extremely flawed estimate. Which isn’t surprising, because among the people doing the estimating, only one has any experience in aerospace engineering (and probably none in costing of such projects). Continue reading How Much Would A Death Star Really Cost?