July 2007 – Page 3 – artdiamondblog.com

Nuclear Expensive “Because of Exaggerated Popular Fears”

In his public testimony Mr. Gore seemed to be convoluting several things, suggesting somehow that nuclear plants are too expensive and take too long to build because they only come "extra-large." This is not true.

Nuclear plants take more time to build and are more expensive than comparative coal plants, but they are not prohibitively expensive. The Japanese are now building reactors in five years at competitive prices. Higher construction costs are more than compensated by lower fuel costs and higher capacity ratings. America’s existing nuclear plants are now operating so profitably that Connecticut Attorney General Richard Blumenthal recently proposed a windfall profits tax because the state’s reactors were making too much money.

. . .

The reason building nuclear plants has been expensive and time-consuming is because of exaggerated popular fears of the technology. The public is now coming around. Seventy percent now consider nuclear plants acceptable, meaning new plants will probably not become bogged down in endless court delays.

For the full commentary, see:

WILLIAM TUCKER. "Our Atomic Future." The Wall Street Journal (Weds., March 28, 2007): A16.

(Note: ellipsis added.)

The Legacy of Rachel Carson

Al Gore dreams of Rachel Carson. Source of image: online version of the WSJ article cited below.

. . . The World Health Organization now estimates that there are between 300 and 500 million cases of malaria annually, causing approximately one million deaths. About 80% of those are young children, millions of whom could have been saved over the years with the regular application of DDT to their environments.

Carson cannot be blamed directly for these deaths. She didn’t urge total bans in "Silent Spring." Instead, on the single page obliquely acknowledging DDT as an anti-malarial agent, she writes, "Practical advice should be ‘Spray as little as you possibly can’ rather than ‘Spray to the limit of your capacity.’"

In the National Archives exhibit, Carson is described as "a passionate voice for protecting the environment and human health." Her concerns about the effects of insect death on bird populations were well-founded. But threats to human health were central to her argument, and Carson was wrong about those. Despite massive exposure in many populations over several decades, there is no decisive evidence that DDT causes cancer in people, and it is unforgivable that she overlooked the enormous boon of DDT for malaria control in her own time.

. . .

. . . DDT remains the cheapest and most powerful tool for stopping malaria. When sprayed on interior walls, it has virtually zero interaction with wild ecosystems. Yet when the topic of relaxing restrictions in order to save millions of lives comes up, someone inevitably brandishes a copy of "Silent Spring" and opposition is silenced so completely that you could hear a mosquito buzzing in the next room.

For the full commentary, see:

KATHERINE MANGU-WARD. "Suffering in Silence." The Wall Street Journal (Fri., April 20, 2007): W13.

(Note: ellipses added.)

Most New Jobs Created in Opportunistic Newcomer Cities

Over the past 15 years, it has been opportunistic newcomers — Houston, Charlotte, Las Vegas, Phoenix, Dallas, Riverside — that have created the most new jobs and gained the most net domestic migration. In contrast there has been virtually negligible long-term net growth in jobs or positive domestic migration to places like New York, Los Angeles, Boston or the San Francisco Bay Area.

. . .

Fortunately the jobs are headed in the same direction. After all, companies depend not only on elite MBAs but upon on the collective skills of middle managers, technicians and skilled laborers. Most companies also tend to be more mindful of basic costs, taxes and regulations than the average hedge-fund manager or trustafarian.

This perhaps explains why the largest companies — with the notable exception of Silicon Valley — have continued to move toward the more opportunistic cities. New York and its environs, for example, had 140 such firms in 1960; in 2006 the number had dropped to less than half that, some of those running with only skeleton top management. Houston, in contrast, had only one Fortune 500 company in 1960; today it is home to over 20. Houston companies tend to staff heavily locally; this is one reason the city was able to replace New York and other high-cost locales as the nation’s unchallenged energy capital. Another example of this trend is Charlotte’s rise as the nation’s second-ranked banking center in terms of assets, surpassing San Francisco, Chicago and Los Angeles, indeed all superstar cities except New York.

For the full commentary, see:

JOEL KOTKIN. "The Myth of ‘Superstar Cities’." The Wall Street Journal (Tues., February 13, 2007): A25.

(Note: ellipsis added.)

Dubai Is “Turbo-Charged Free-Market Capitalism”

Dubai skyline. Source of photo: online version of the WSJ commentary quoted and cited below.

(p. A9) Dubai, which is part of the United Arab Emirates, represents turbo-charged free-market capitalism at its purest — sometimes crass, often over-the-top, and always in motion. Home to more than 1.2 million people, more than 80% of whom are resident aliens, Dubai is as much a multicultural melting pot as New York City was in its late 19th century heyday. And like New York then, Dubai teems with winners and losers, the rich and not-so-rich, and immigrants who often find that life in the glittering metropolis is cold, hard and unfair. But the government maintains order, spends billions on infrastructure and is dedicated to establishing the city-state as a global capital of, well, capital.

. . .

Seeing Dubai as an economic model for other parts of the Arab world is admittedly a challenge: Like Singapore, it has the virtues of a small ruling class, a tiny population and not much territory, and that is not something Egypt or Syria could emulate. But as a cultural model, or an attitude, it does offer an alternate vision of the future, one with its own excesses and vices for sure, but still free of the divisiveness and religious conflict that has become the assumed status quo in other parts of the Middle East.

Dubai should not be written off as little more than an Arab Las Vegas. It deeply challenges the assumption that Muslims, Christians and Jews cannot find common ground and work together to construct a shared future. Dubai is proof, not perfect, but real, that they can.

For the full commentary, see:

ZACHARY KARABELL. "City of Dreams." The Wall Street Journal (Sat., March 17, 2007): A9.

(Note: ellipsis added.)

FDA Should Not Restrict Drugs the Terminally Ill Choose to Use

On March 1, a federal appeals court will hear oral arguments in the case of the Abigail Alliance organization’s lawsuit to change systems at the Food and Drug Administration to allow terminally ill patients access to promising drugs that have successfully completed initial stages of human safety testing. Because of my former role in the oncology division at the FDA, and in my eight-year experience as a cancer patient advocate on behalf of my son, I may be able to shed some light on the regulatory policy, medical drug development and patient rights issues surrounding this landmark case.

. . .

Patients have valid arguments in demanding greater access to promising agents under development. Public servants should respect citizens who advocate that they be allowed to have a say in methods of their treatment when terminally ill, and government officials should have very compelling reasons for denying such access. New drug development will not suffer if a small minority of patients fighting for their lives, with no other options and in concert with their physician, gain access to a potentially beneficial agent with an established basic safety profile.

For the full commentary, see:

MARK THORNTON. "The Clinical Trial." The Wall Street Journal (Mon., February 12, 2007): A14.

(Note: ellipsis added.)

According to the online version of USA Today, the court did hear oral arguments on March 1st, and ". . . isn’t likely to rule for several months, . . . "

Source: http://www.usatoday.com/news/nation/2007-04-02-unapproved-drugs_N.htm

Schumer Surprised at No Increase in Job Volatility

Source of graph: online version of the NYT article cited below.

(p. C1) Last week, the Congressional Budget Office released a study that was arguably the fullest picture of (p. C12) economic volatility anyone has yet put together. Although some academics have taken a crack at the topic in recent years, they have had to rely on surveys in which people are asked how much money they make. The study by the C.B.O., as the budget office is known, used Social Security Administration records, which cover many more people than the surveys and are more reliable.

If you read the C.B.O. report, you can tell that its authors knew they were dealing with a delicate subject. The summary starts by noting that a “significant number of workers experience substantial variability in their total wage earnings,” which is certainly true. Only later do you come to the surprising part: there is the same amount of variability now that there was in the 1980s and 1990s. In journalism, this is known as burying the lead.

“Intuitively, you would think volatility is increasing,” said Senator Charles E. Schumer, Democrat of New York, who along with Senator Jim Webb of Virginia requested that the study be done. “But it isn’t, which I guess shows that the American economy has always been very flexible.”

Mr. Schumer’s point about intuition is an important one. We can all tick off reasons that the economy feels so volatile. Hardly a week goes by without another big corporation — the Tribune Company, Citigroup, DaimlerChrysler — announcing a big job cut. The number of temporary jobs, meanwhile, has mushroomed. Globalization and technological innovation are causing many of these changes, and labor unions are too weak to prevent them.

But there is also a whole set of other forces, harder to see and pushing in the other direction. Manufacturing, where furloughs and layoffs have always been the norm, accounts for a much smaller part of the work force than it used to, while more stable industries, like health care, have grown. This is one reason that recessions, and the job cuts they bring, haven’t happened as often as they once did.

. . .

In fact, research by Henry S. Farber, an economist at Princeton, has found that job loss rates have followed a cyclical pattern since the early ’80s, peaking around the same highs during recessions and falling to similar lows during expansions. (The rate has risen for workers who went to college and fallen a bit who those who didn’t.)

Americans, looking at their own jobs, realize that there hasn’t been a big change: in a recent Gallup Poll, 12 percent of respondents said it was very or fairly likely they would be laid off in the coming year. In the 1970s, ’80s and ’90s, at similar points in the business cycle, the percentage was virtually identical.

For the full commentary, see:

DAVID LEONHARDT. "ECONOMIX; What’s Really Squeezing the Middle Class?" The New York Times (Weds., April 25, 2007): C1 & C12.

(Note: ellipses added.)

“The Individual Dominates the Story of American Innovation and Is Insufficiently Honored”

When an innovator is overlooked or an innovation misrepresented it is not simply a question of equity; it distorts our perception of the essence of innovation and the essential qualities of an innovator. It clouds our perception of what it takes to survive in global competition.

The individual dominates the story of American innovation and is insufficiently honored in our histories — to say nothing of the abysmal history courses in schools and colleges. Only recently did Columbia University honor Armstrong with a plaque in his laboratory, and Rutgers University is still short of funds to catalog properly the immeasurable riches of Thomas Edison’s papers — all five million pages of them.

The research departments of major corporations have not been unproductive — one thinks of the Bell Labs for the transistor and today Monsanto in biotechnology — but can anyone have had more impact on our world than the 23-year-old trucker who got frustrated at the day he spent on the noisy pier in Hoboken, N.J., waiting to have his cotton bales unloaded from his truck, loaded onto the cargo ship, and then unloaded and loaded again at the other end?

For nearly 20 years, Malcom McLean did nothing about his inspiration that it would have saved everyone a lot of time and trouble if he had just been able to drive his truck on to the ship. Why didn’t anybody facilitate that before he organized the sailing of the Ideal X from Port Newark, N.J., on April 26, 1956? Might as well ask why it took us so long to put wheels on luggage.

For the full commentary, see:

HAROLD EVANS. "The American Way." The Wall Street Journal (Sat., February 17, 2007): A9.

Evans is the author of a huge, very interesting book:

Evans, Harold. They Made America: Two Centuries of Innovators from the Steam Engine to the Search Engine. New York: Little, Brown and Co., 2004.

“The Least Hospitable Environment on Earth”

Source of the book image: http://images.usatoday.com/money/_photos/2007/03/26/cubicle-bookx-large.jpg

Office humor is an oxymoron. At least that was the prevailing view until Scott Adams’s "Dilbert" comic strip and, more recently, British television import "The Office" opened up this fertile ground for mainstream ridicule. The latest entry in the growing corpus of workplace-whacking is "The Cubicle Survival Guide: Keeping Your Cool in the Least Hospitable Environment on Earth," by first-time author and Web-site production coordinator James F. Thompson.

Mr. Thompson’s target: the cubicle, or "cube," as it is not so fondly known. It’s surprising to learn that this ubiquitous steel-and-fabric prison was not invented until the 1960s, the dubious brainstorm of a Colorado fine-arts professor named Bob Probst. His goal, according to Mr. Thompson, was to encourage co-workers to "freely exchange ideas and inspiration" — and not, as commonly believed, to breed a legion of the undead who feel they are somehow unworthy of, say, a door.

For the full review, see:

MARTIN KIHN. "BOOKS; The Best Way to Labor Away in Our Little Boxes." The Wall Street Journal (Weds., March 14, 2007): D9.

The reference to the book, is:

James F. Thompson. THE CUBICLE SURVIVAL GUIDE. (Villard, 216 pages, $12.95)

Neglect of the Important Issues, Is the Opportunity Cost of Pursuing the Cutely Clever

The Wall Street Journal summarizes an April 2, 2007 article by Noam Scheiber in The New Republic:

A new generation of economists has become so addicted to cleverness that dull but genuinely useful research is under threat.

"Freakonomics," the 2005 best seller that sought to explain the mysteries of everyday life through economics, is only partly to blame, writes Noam Scheiber. The deeper roots lie in a 1980s crisis of faith over economists’ ability to reliably crunch numbers. Influential economist H. Gregg Lewis kicked it off by demonstrating that a host of broad, worthwhile empirical surveys of unions’ impact on wages came to opposite conclusions, mostly thanks to the differing original assumptions by the studies’ authors.

As a result, some economists retrenched, opting to focus on finding "solid answers to modest questions."

For the full summary, see:

"Informed Reader; Economics; How ‘Freakonomics’ Quashes Real Debates." The Wall Street Journal (Weds., March 28, 2007): B11.

Obama Advised By Economists Cutler, Liebman, and Goolsbee

Source of graphic: online version of the WSJ article cited below.

In a previous entry, I expressed guarded optimism in response to an article that identified Austan Goolsbee as an advisor to Obama. The article excerpted below, casts Goolsbee in a less central role, thus giving reason to guard the optimism even more.

While Mr. Obama’s economic platform is still in its formative stages, interviews with his aides and a review of his congressional record and speeches suggest that Obamanomics may place him somewhat to the left of New York Sen. Hillary Rodham Clinton, but to the right of former North Carolina Sen. John Edwards, another rival for the 2008 nomination. Mrs. Clinton seems to be cultivating the centrist mantle her husband won during his presidency, while Mr. Edwards is courting the party’s labor and grassroots activist base.

. . .

As Mr. Obama prepares for his first series of domestic-policy speeches in the coming weeks, he appears to be still shopping for a place on the political spectrum.

One top economic adviser is Jeffrey Liebman, a Harvard economist and former adviser to President Clinton who is focused heavily on the earned income tax credit and its role in moving people from welfare to work.

The candidate is also consulting with University of Chicago economics professor Austan Goolsbee, a taxation expert and centrist Democrat who has advised Mr. Obama since his 2004 Senate campaign.

David Cutler, a Harvard economist specializing in health policy who served in the Clinton administration, is also among Mr. Obama’s advisers.

For the full story, see:

DEBORAH SOLOMON. "Seeking Clues to Obamanomics; Democratic Candidate Is Just Beginning To Fill In the Blanks." The Wall Street Journal (Tues., April 24, 2007): A4.

(Note: ellipsis added.)