Category Archives: Social Issues

Bush II and His Faith-Based Bailout

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Where is the Decider President? He sent his creepy surrogate, Dick “Rasputin” Cheney, slinking around to urge members of congress to support the bailout plan, but where is George?.  I suppose Bush II is lying low to avoid casting the long shadow of the GOP on this banking train wreck.

But it’s just so striking; in the run up to the largest business bailout in the history of the solar system, Secretary Paulson’s boss is strangely absent. No frank and heartfelt talk with the American people. All the Bush administration can do is to attempt to hustle congress into a mysterious plan. Take our plan on faith- we know what we are doing.

No details have been released to the citizens regarding how this number, $0.7 trillion, was arrived at. Is this large sum actually large enough? How does the country recoup this outlay?  Is the stated urgency related to the election?

Citizens must learn to save more cash and be smarter about the terms of the mortgage they sign. We must consider that our banking system is much like the municipal water system- it’s integrity must be scrupulously maintained and those who manage it must be held accountable for its operation.

Update:  Bush II will make an announcement to the nation this evening. I wonder if there will be any folksy anecdotes?

Drill Baby Drill!! The GOP Call to Arms.

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I recall sitting on the sofa watching the 2008 GOP convention and hearing the intoxicating refrain “Drill Baby Drill”. It was like the sensation of sitting in the dentist chair with my brainstem bathed in cool nitrous oxide vapors and face numbed with lidocaine.  I found myself tumbling head over heals in a mild, drooling, narco-twilight state while my twitching eyeballs attempted to focus on McCain.  My fellow citizens had drummed themselves into an enchanted war dance and gathered to hear Colonel Kurtz, but without the banana leaves.

Then I snapped out of it.  Drill baby drill. This was not just a work order or a requisition for drilling staff to please set up a few drilling rigs in the morning. This was an exhortation to rip those smirking tree huggers from their stations, pulp the trees to make a paper dunce cap for Pelosi, and call in the Air Force to oversee saturation drilling of the continental shelves, and do it pronto!

“Drill baby drill ” was a catch phrase along the lines of “Damn the torpedoes! ” or “somebody get a rope! ” Its conception and use was a masterful bit of applied propaganda- A figurative running of the liberals out of town on a rail.

But what was lost in the excitement were the pragmatics of oil production. You need to boost refinery capacity to increase the supply of refined fuels.  And, what oil company is going to attempt to flood the market in a bid to drive down oil prices? What oil company is going to step in and provide cheaper crude to US refiners so that they can, dutifully, distribute cheaper gasoline when the global market price is so high? Only the dumb ones. Do they think that Santa Claus runs Exxon?

I thought GOP’ers were market savvy, laissez faire devotees swingin’ the big stick of Ronnie Reagan tough love? What has happened to these people?

Seems to me that oil in the ground is like money in the bank. Why are we so anxious to deplete North America of its supply??  What about pulling back on demand to counter the high prices? That is the one big stick that consumers have in the market.

Are B-Schools Paying Attention to this Fiasco?

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The dam burst of banking disasters and federal bail-outs of firms “too big to fail” has brought to light the fragility of our banking and investments system. Like a tropical depression that forms in the eastern Atlantic ocean and gradually feeds on the warm waters and moist air until it makes landfall as a rampaging storm, the combination of greed, financial deregulation, and enthusiastic liquidity on the part of the Fed has now spun up into a full fledged economic storm.

In an essay posted on CNN.com, Columbia Professor Joseph Stiglitz, among others, points to some causes of the present calamity on the banking and financial businesses. Stiglitz says-

“One can say the Fed failed twice, both as a regulator and in the conduct of monetary policy. Its flood of liquidity (money made available to borrow at low interest rates) and lax regulations led to a housing bubble. When the bubble broke, the excessively leveraged loans made on the basis of overvalued assets went sour.” 

“The new “innovations” simply hid the extent of systemic leverage and made the risks less transparent; it is these innovations that have made this collapse so much more dramatic than earlier financial crises …”

The mess that taxpayers and investors are left with is the result of greed and recklessness on the part of elite “business leaders” in conjunction with Federal officials only too anxious to deregulate and discount. This is not a failure based on physical reality. It is a failure based on greed and poor judgement. It rests on a morally shallow and sadly misguided philosophy that mere acquisition of currency is reason enough for being and is the sole measure of success.

As a start, it is my hope that the Deans and faculty of our business schools can summon some kind of movement to reform their admissions standards and refine their ethics curricula.

Perhaps certain finance practitioners need to be trained and certified in a manner similar to actuarial professionals?  Seems to me that the people who launch financial instrument schemes with the potential to collapse an economy should be at least as well trained in risk management as an actuary.

A firm proposing a financial instrument for sale to the public should be required to prepare a mathematical model with macroeconomic inputs to model the potential for instability. The kind of discipline needed to do this modeling could help people refine the fund structure so it remains manageable in a broader range of economic conditions. This would also provide for a real transparency to regulating agencies and possibly even investors.  But most importantly, if you want to model it, then you have to understand it. And that is part of what has been lacking.

I have a dream too!

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I have a dream. I dream of a time when election crazed talking heads find some new metaphores. I dream of a time when networks lengthen the news sampling interval from 5 minutes to something greater. I dream of a time when microanalysis of the faintest political nuance is recognized for what it is- gossip. I dream of a time when broadcast news people understand the concept of signal to noise ratio.

Finally, I dream of a time when people focus on the core of MLK’s dream- nonviolence- rather than the attention deficit parroting of the 4 words for the sake of loftiness.

Bacevich on Consumerism and the Imperial Presidency

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While I have been struggling in my usual caveman way to express my frustrations with our national governance, whom should I stumble into but Andrew J. Bacevich, Boston Univ professor of history and international relations, who has been working on this matter for some time. Bacevich has written a book called The Limits of Power: The End of American Exceptionalism.  This exceptionally articulate fellow was recently interviewed by Bill Moyers on public television. 

His thesis comes down to the notion that American demand for consumer goods and credit has resulted in a kind of consumer imperialism. To facilitate this “domestic disfunction” or “crisis of profligacy”, the executive branch has acquired an excessive reach that exists only by the wither and atrophy of congress. By fiat of the executive, and the mumbling consent of a passive congress, our military adventures have distracted Americans from an examination of our continuous and undisclipined consumerism and indebtedness.

From NIMBY to BANANA

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The 2005 government report entitled Peaking of World Oil Production: Impacts, Mitigation and Risk Management, by Hirsch, Bezdek, and Wendling, is a sobering tally of the current picture of oil production and consumption in the world today. Often referred to as the Hirsch Report, the authors take a “now shot” of the global oil production scene and speak directly to the matter of mitigating the approaching economic disruption that must usher an unprepared nation into a future of peak and declining oil production.

If you read the Hirsch Report and pay attention to current events, you may be gripped by a kind of cognitve dissonance, or a haunting sense resembling a schizophrenic episode of contradictory voices in the collective consciousness.  While the global warming showboat is paddling up and down the Mississippi blowing steam and calliope music, nationalized oil producers are failing to answer calls for increased production in reply to a dramatic ramp-up in petroleum demand. Some call for increased exploration and others call for drop in replacements for petroleum. All the while, evidence accumulates that the ecosystem suffering from consumption and waste generation.

As with any discussion involving economics, it is possible for people to speak imprecisely when discussing supply and demand. Econobrowser takes Hirsch to task in this manner. It seems that many of us confuse demand with desire.

Supply equals demand today, supply will equal demand in 2025, and supply will equal demand in 2050. Whatever Hirsch means by “peaking of world conventional oil production,” it certainly isn’t the condition that “production will no longer satisfy demand.”

Our news media, now almost fully morphed into a perverse mix of gibbering Bill O’Reilly clones and entertainment news programming, prattles endlessly about the hurtful gasoline prices and truncated vacation plans. Government makes flatulent noises about more drilling, but hardly a peep about reduced consumption.  Where is the journalist corps? Who is asking the tough questions?

In isolation, either climate change or an exponential oil shock are more complex than nimrods leaders in the Bush administration can process. Together, these stresses add up to a major challenge to the way we live.  Maybe the situation is more complex than any nation can reasonably respond to. With global prosperity comes global demand for resources.  Western nations have built a house of cards based on cheap petroleum. Instead of wage growth in the past 20 years, we have been given easier access to credit. Instead of increased savings, we have found ways to burn up discretionary income.

A major part of what has to happen to adapt to the new reality of petroleum scarcity is a remodel of our infrastructure. We need more passenger rail lines and terminals with the necessary right-of-way issues taken care of. Workers need to live closer to their place of employment. The airlines have to figure out how to operate profitably with reduced passenger miles. We must upgrade our electric power distribution system to accommodate the increasing reliance on electrical energy. If wages do not change, we must adapt to having less discretionary income to spend. 

But a remodel of infrastructure will require that we adapt to living nearer to it. In the past, a proposal to build a power plant is met with a chorus of outrage or “concern”. It used to be called NIMBY- Not-In-My-Back-Yard.  The latest acronym is BANANA- Build-Absolutely-Nothing-Anywhere-Near-Anything. New power transmission lines and generating plants will have to go up and it will have to happen somewhere. People naturally fret about real estate prices and their view from the dining room window. I foresee more exercise of eminent domain in the future.

Secular Marriage. Gaussling’s 8th Epistle to the Bohemians.

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Below is a comment that I left on the Volokh Conspiracy some time ago. Rather than squander perfectly good ramblings there, I have reproduced it here and attached a link.  Th’ Gaussling

Broadly, we have two kinds of marriage in the USA. One is before a god and the other is before the state. Marriage before a god is a supernatural arrangement that is beyond the scope of this letter.

It would seem that the states compelling interest in marriage is mostly confined to the disposition of debts, assets, and minor children during the marriage and in the event the marriage fails. Married partners have an obligation to the welfare of minor children born to them or adopted. Married partners also have a status that allows for decision-making in critical care situations. It seems to be a kind of partnership whereupon responsibility for the secular aspects of married life are defined. After all, the state is called in to make decisions as to the disposition of civil matters in the event of a divorce. Surely the state can clearly define certain basic responsibilities and privileges in advance.

The moral/spiritual aspects of marriage “can” be interpreted as being perpendicular or orthogonal (like the x and y axes in a graph) to the legal dimension of property rights and other secular aspects of married partners. The state is without supernatural powers, thankfully, so it is inherently impotent in the spiritual dimension. If that is the case, and in the absence of a uniform interpretation of supernatural governance, it should be silent on spiritual matters.

The state should have no interest in how married partners conduct their lawful affairs beyond the normal confines of civil and criminal law.

A code defining the responsibilities of married partners in a variety of configurations could be modeled easily. If you accept the premise that secular marriage is confined to the mundane matters that are already contestable in a court, then it is a simple matter to imagine same sex or plural marriages under the same constraints. What is the compelling interest of the state in barring same sex partners from having automatic authority in giving comfort to a dying partner? We already have codes regulating many other kinds of complex relationships between people- corporations, partnerships, LLC’s, government, etc. Minimally, the state should entertain the prospect of recognizing limited entry of some new definitions of marriage to adult parties wanting to be responsible members of society with the rights and responsibilities thereto appertaining.

The Chemistry Curriculum

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It is time to have a frank talk about the fundamental merits of the college chemistry curriculum. This plan of study has remained substantially unchanged for decades (see comment by bchem). Certainly minor changes occur through nudges and bumps here and there pertaining to details. But in the last generation has there been a dialog or debate on the fundamental assumptions of the common curriculum? And I refer specifically to the ACS certified curriculum, which has been the gold standard across the country. Major changes that I have been witness to mainly accomodate an increased emphasis on biochemistry or new computerized instrumentation. 

The undergraduate chemistry curriculum is a very logical and thorough survey of the three pillars of chemistry- Theory, synthesis, and analysis. This covers the fields of inorganic, organic, physical, analytical, and biochemistry. Along the way we teach a few other areas of specialty by way of electives.

The current program of chemical pedagogy is certainly true to itself. There is genuine concern and care to avoid dilution of the content and over-inflation of grades, generally. The core domains of the subject are sorted out and given special consideration. Much work has been done to spark interest in the field and textbooks seem to be written quite well as a rule.  Resources like J. Chem. Ed. are a continuous stream of clever tools and tricks to make the subject more plain.

Our colleges and universities have been quite good at churning out chemical scholarship. And students are given scholarly exposure in their learning program. Not surprisingly, scholars are very good at producing more scholars.

But has the academy been keeping up with the role of chemistry in the world?  Just look around. How many CEO’s and upper executives in the top 100 chemical companies are chemists? I have not seen this statistic tabulated. But I am confident that relatively few chemists populate those ranks. Those that do often arise through marketing or finance channels.

But why should they? The field of chemistry attracts people interested in science, not business. Chemical educators have a responsibility to educate chemical scientists with a minimum proficiency in the field.  That requires a minimum number of semester hours of coursework within a 4 year period. There is only so much a department can do and so much a student can absorb.

Yet, the purpose of a college education is to prepare a student for a productive life. A learning program that is internally consistent but blind to the needs of the external world is a fantasy. Have we come to value programmatic tidiness more than practicality?

Chemistry is a highly practical field. It involves problem solving and production. Chemists make stuff. Chemists solve problems. Chemists are specialists in the transformation of matter. But chemists do not operate in a vacuum. They do their work for organizations, and there is the rub.

By training, chemists are woefully prepared to function outside the laboratory. And as a direct result, chemists are poorly prepared to leave the lab and function elsewhere in the organization.  Traditionally, education in the organizational arts has been considered on-the-job training. In a sense this is not unreasonable. How can educators anticipate the needs of a student 5 years into the future? 

What is under appreciated by educators and students alike are the many opportunities that will follow for a chemist in industry. Many if not most chemists will come to a fork in the road in their careers. Will they stay in the lab or will they go to the business side? Usually, the path to greater opportunity in a business organization is the business side. Technical sales, customer service, marketing, procurement, management, etc.

I am not proposing that chemistry faculty teach coursework that cover such material. I am trying to suggest, however, that chemistry departments take a closer look at what an industrial career really looks like and try to anticipate a few needs that will arise as a result of this career path. Advisors can talk to students about the possibility of a business minor. An accounting or marketing class could be very helpful for a student who is uncertain about his/her career path. These are painless actions that can be of great use to a graduate.

But there is more than the passive approach of suggesting alternatives to undergrads. There is a more active approach that would definitely serve the needs of students and society alike.

Elective coursework covering intellectual property and patents, business law, the regulatory world (TSCA, EPA, OSHA, CERCLA, REACH, etc.), industrial hygiene, and perhaps most importantly an introduction to chemical engineering. This last item I cannot overemphasize.  Chemical engineering includes the basics of unit operations, process economics, thermodynamics, and controls. I would offer that the whole package could be called Industrial Chemistry. 

There are junior college programs for chemical operators that do provide exposure to some engineering concepts. But this isn’t necessarily for management track graduates.

I would offer that the department with an industrial chemistry program would be very successful in job placement as well as attracting new majors.  Comments?

 

Poorer Living from Better Things

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I’m not an apologist for the chemical industry. Chemical industry has a checkered past in many ways. The pesticide, petrochemicals, and mining industries have left a deep and abiding foul taste in the mouths of many communities. In a previous era, heavy industry has fouled rivers, lakes, air, and ground water. It has lead to illness, death, and loss of livelihood to many people.

But in the modern era much of this wanton issuance of hazardous industrial material into the air and waters has been halted or greatly diminished. At least for the US, Canada, and the EU. And it is not because industry suddenly found religion. The “regulatory environment” became so compelling a liability cost factor that industry set its mind to engineering plants into compliance. 

I would make the observation that today, the major chemical health issues before us are not quite as much about bulk environmental pollution by waste products. Rather, I would offer that the most important matter may have to do with the chronic exposure of consumers to various levels of manufactured products. High energy density foods, particularly, high fructose corn sweeteners; veterinary antibiotic residues, endocrine disrupters, smoking, highly potent pharmaceuticals, and volatiles from polymers and adhesives to name just a few.

Modern life has come to require the consumption of many things.  A modern nation must have a thriving chemical industry to sustain its need for manufactured materials. It is quite difficult and isolating to live a life free of paint and plastics or diesel and drugs. Choosing paper over plastic at the supermarket requires a difficult calculation of comparative environmental insults. Pulp manufacture vs polymer manufacture- which is the least evil? I don’t know.

Our lives have transitioned from convenience to wretched excess. Our industry has given us an irresistable selection of facile ways to accomplish excess consumption. Individualized portions meter out aliquots of tasty morsels that our cortisol-stressed brains cry out for. These same portions are conveniently dispensed in petroleum- or natural gas-derived packages within packages within packages. These resource depleting disposable nested packages are delivered to our local market in diesel burning behemoths because some pencil-necked cube monkey decided that rotund Americans needed yet one more permutation of high fructose corn syrup saturated, palm oil softened, sodium salt crusted, azo dye pigmented, extruded grain product on Wal-Mart shelves.

Enough already.

All Rights Reserved. Copyright 2008.

Spacely Sprockets

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A commentor recently pointed out that Th’ Gaussling was sounding off in a nationalist/socialist way. While I’m pretty sure I’m not a socialist, I must admit that I’m on a nationalistic bender at the moment. And by nationalistic, don’t think for minute that I get weepy and sentimental over Kenny Rogers flag waving ballads. I don’t.

But I do believe that, in the short and bloody history of humanity, this North American culture of ours has produced or advanced some truly amazing things. Like space exploration and antibiotics. Airplanes, transistors, synthetic chemistry, and cinema. We’ve had some low points as well. But in spite of our war-like behavior, much good has come from our industriousness. 

And, I am anxious to keep it much of it running. There is no return to a pastoral life in the Shire. We are electric hominids whether we like it or not. The very existence of life itself leads to disorder. Highly ordered organisms that we are, we create vast amounts of disorder to energize life and hold our molecules together in cellular membranes.  Practically by definition, we cannot help but leave a carbon footprint. The trick is to avoid adding carbon faster than the cycle can accomodate.

It is plain as day that the USA is trending in a bad economic direction. I’m not talking about economic indicators or some political movement. I’m talking about our business culture. I believe that our manner of doing business has gone astray.  We have come to value the wrong people and unhealthy organizational behavior. We have come to admire those who appear to generate wealth by the manipulation of financial contrivances and accounting machinations. Strangely, the notion of manufacturing as a desirable activity has become nearly obsolete.

We don’t need Grand Theft Auto IV or Microsoft Vista or better cell phone gimmicks. We don’t need more gadgets to give neurotic, hyperactive, workaholics 2X better web connectivity.  Somehow, we have become intoxicated with computer technology to the point where we feel we need to fill terabytes of disk space with junk data rather than going outside and planting a garden or talking to the neighbor.

The greedheads in banking, finance, and real estate have helped to construct a business finance machine that few understand. Greed as a virtue is the norm. The right to petition congress has come to mean a docking port for electronic funds transfer to the military-industrial complex. If gaming the system is possible, then it is manditory.

We don’t have to abandon the basic principles of laissez faire markets. Markets work. Even the Chinese communists realize this. But we don’t have to shut our brains off either.

We do need a comprehensive mass transit network covering most of the continent. We need better ways to generate and transfer electric power. We need to find ways to make sure that people in Honduras have clean drinking water.

We don’t need a better version of Excel or SAP. We need Spacely Sprockets. We need people to continue to go into the trades and build things. We need welders and electricians and machinists, millwrights and longshoremen.  This country needs to get back to the fundamentals of manufacturing tangible products.