More Intelligent Technology. Fewer Jobs.

The MIT Review article How Technology Is Destroying Jobs summarizes the potential on-set of the Human Labor-free Economy. Others call it the Autonomous Economy; an economy that runs without people!

This is of course an exaggeration but the fact is that since people invented tools many laborious tasks became simpler. Then the industrial revolution accelerated the pace of machine substitution of the labor. However, the big and varied tools and machines wound up increasing the demand of human labor because they changed the scale of what is achievable in agriculture, infrastructure, war equipment, etc.

Then came IT, computers and robotics. The MIT Review graph below illustrates the decoupling between Economic Productivity and Employed Labor. Automated vehicle manufacturing plants, automated warehouses, automated luggage handlers, etc. are already present. Currently at some health providers the first level diagnosis of patient ailment is conducted by registered nurses who also have some prescription authority. A large number of patients do not see an MD.

The short term outcome was angrily revealed by the Occupy Wall Street movement nearly two years ago: The MIT Review a notes that big progress in technology grows the economy and creates wealth, “but there is no economic law that says everyone will benefit. In other words, in the race against the machine, some are likely to win while many others lose.” Income inequality is a well researched topic.

However, this analysis on the effects of technology on labor is only the beginning. The hundreds of thoughtful comments below the article are enlightening and perhaps frightening.

• In the future, people may be “chipped” like animals. As a result there will be no need for laborious ID inspections at airports and elsewhere. There will be much less need for credit cards or buying tickets for transit, theater and museum admission, etc. The individual’s presence is enough to trigger a charge which minimizes the need for conductors, inspectors and clerks.

• Autonomous cars are here and they drive in actual traffic. They will take several more years to perfect but eventually there may be no need for taxi drivers, bus drivers and trash collectors.

• Mail, if there is paper mail 50 years from now, can be fully robotized. The central processing at major handlers such as USPS, FedEx and UPS is already automated.

• Distance learning is quickly becoming ubiquitous. The number of college courses is finite.  A few thousand of the "best professors” in each subject may tape the lecture and offer real time updates thus reducing the need for tens of thousands of in-class lecturers and professors.

A very large part of the population on Earth is still developing, so substitution of labor will take a long time because it takes an advanced and rich economy with the knowledge and capital base to develop the substitution, and eventually result in gross social instability as unemployment departs the tolerable 10% and moves to 30% or more.

If the means are found to control social instability, accelerating substitution is not sustainable unless regional Uber Governments are formed that control all the machines and humans on a continental scale. The central authority will regulate human birth rate, goods consumption and life duration, to keep a balance. Not surprisingly national and local policies for such control of human activity already exist.


One of the long term effects of unemployment (and draconian controls) is lower birth rate. This puts the Earth on a more sustainable path because the current path of population growth and consumption is clearly unsustainable.

There is also some likelihood that an electromagnetic pulse or an IT superbug will render this interconnected IT and automation useless. At that point, the remaining third world populations will have a distinct advantage.


The most likely short term outcome is that the recently observed trend of accelerating income disparity and unemployment will continue. The regulation of automation may follow to control unemployment and social instability.

The long term outcome has been postulated by MIT researchers since the early 1970s: For many reasons such as technological substitution, energy availability and cost, climate change combined with food production for an ever increasing population will produce a vast global imbalance. As a result, around 2030 they predicted, there will be a global reduction of the standard of living and population.

Honolulu Officials Praise Ansaldo Rail Deal as Washington Metro Dumps the Cash Strapped Italian Company for Kawasaki

Grabauskas and the HART Board will say anything to excuse the inexcusable decision to buy troubled rail cars from a troubled rail car company in a troubled country on the other side of the planet, Prevedouros said.

Panel Discussion on Rail at University of Hawaii-Manoa

• Rail opponents UH Professors Randall Roth (Law) and Panos Prevedouros (Engineering)
• Rail proponents Dan Grabauskas, CEO of HART and Ivan Lui-Kwan, HART Board Member

Here's an independent "post-debate" assessment:

Dr. Prevedouros,

Thank you immensely for your participation in the April 9 rail debate at UH-Manoa.  There is no doubt that you and Professor Roth prevailed.  You both showed the audience and Daniel Grabauskas and Ivan Lui-Kwan that the case against rail is very powerful.

It would be ideal if the truth about rail could continue to be made known to the public, many of whom voted to approve steel wheels on steel rail without really understanding the downsides of rail.  The more people learn the whole truth about rail, the more ready they could become to rise up and demand that the persons responsible for foisting rail on the public be held accountable when it becomes apparent that the billions spent on this scheme have irretrievably gone into a gigantic "black hole."  I would hate to see the culprits simply ride off into the sunset.

Again, many thanks for your invaluable efforts to expose the monumental steel wheels blunder.

K. Hirata

The Lack of New Warming Is a Surprise -- Recall Al Gore!

These two graphs from a major article in The Economist (see source below) clearly indicate that:

1.  Global Warming occurred between 1985 and 1998, but Earth's temp has remained fairly steady for 15 years now!
2. The predictions of Global Warming models are incorrect.
3. The yellow lines indicate the year when Al Gore and IPCC received the Nobel Prize "for their efforts to build up and disseminate greater knowledge about man-made climate change, and to lay the foundations for the measures that are needed to counteract such change" (the bold is mine.)

Global Warming alarmism has caused the inappropriate issuance of two Nobel Prizes (Gore and Obama) and the unnecessary brainwashing of millions of young children at their schools.  Global Warming alarmism gave more support to "environmentalists" whose most prominent successes are to pick the wrong winners (e.g., cost ineffective renewables and rail systems) and make life more expensive in first world populations, and more difficult to rise out of poverty for third world populations.

Now The Economist from Europe, where the core support of Global Warming alarmism is located, has provided some reasonable perspective which shows that:

• There is no denying that some Global Warming (GW) has taken place.
• GW has remained stable for at least a decade.
• Models used by the Intergovernmental Panel for Climate Change (IPCC) predict the wrong trend.
• GW did not increase despite the billions of tons of anthropogenic (man-made) CO2 emissions
• Arctic ice does melt to unusual levels in the summer months but no appreciable sea level rise has been recorded.
• Nobody knows what the real effects of an increasingly less possible GW are.

The main article of The Economist is titled Climate science: A sensitive matter -- Here are a few interesting quotes from this comprehensive article:

• "Temperatures fluctuate over short periods, but this lack of new warming is a surprise."
• "The mismatch between rising greenhouse-gas emissions and not-rising temperatures is among the biggest puzzles in climate science just now."
• Despite all the work on [the planet's] sensitivity [to carbon dioxide emissions,] no one really knows how the climate would react if temperatures rose by as much as 4°C.

Three days later The Economist added a short article to calm down Europe's socialists and Obama-like pro carbon taxation politicians (see last bullet below). These politicians need to keep people focused on secondary problems like the GW, because primary problems such as huge budget deficits and problematic pension and health care systems cannot be addressed in the socialist realm of thought. The short article is titled Global warming: Apocalypse perhaps a little later. Exact quotes below. The bold section is mine.

• The science that points towards a sensitivity lower than models have previously predicted is still tentative. The error bars are still there. The risk of severe warming—an increase of 3°C, say—though diminished, remains real.
• Bad climate policies, such as backing renewable energy with no thought for the cost, or insisting on biofuels despite the damage they do, are bad whatever the climate’s sensitivity to greenhouse gases. (Thank you for this. I am sorry to inform you that California, Hawaii, The Blue Planet Foundation and several "environmentalists" do not subscribe to reason, cost-effectiveness analysis or The Economist.)
• Good policies—strategies for adapting to higher sea levels and changing weather patterns, investment in agricultural resilience, research into fossil-fuel-free ways of generating and storing energy—are wise precautions even in a world where sensitivity is low.
• Put a price on carbon and ensure that, slowly but surely, it gets ratcheted up for decades to come. 

I enjoy The Economist for its variety of subjects, reasonable depth of analysis and humor.  I'm sorry, humour. I was disappointed that nowhere did they ask for a recall of Al Gore's and IPCC's Nobel. The two shared a Nobel Prize in 2007.

Hawaii Government Cannot Perform Basic Government Functions

Inspections is a very basic function of government. Inspections minimize errors and fraud.

On March 2013 Hawaii State Auditor reported on the Hawaii's Measurement Standards Branch.

The three bullets below are highlights of the auditor's summary. The third bullet is a true Jay Leno joke. But this one is real.

• The Measurement Standards Branch is tasked with enforcing the U.S. standards for weights and measures. Because of budget shortfalls since FY2010, the branch experienced a significant decline in the number of inspector positions. Currently, six of the branch’s 11 positions remain vacant, and we found that the branch’s two remaining inspectors can only perform eight of the branch’s 15 key regulatory functions.

• Inspections of measuring devices have fallen significantly. From FY2007 to FY2009, the branch inspected an average of 21% of small scales, 10% of medium scales, and 31% of gas pumps registered in the state. However, from FY2010 to FY2012, the branch inspected an average of only 2.6% of the small scales, less than 1% of medium scales, and 6.7% of the gas pumps registered in the state. Moreover, enforcement functions on the neighbor islands and packaging and labeling inspections throughout the state have ceased as of 2009.

• Recognizing these deficiencies, the 2012 Legislature appropriated $420,000 to restore a program manager and three new inspector positions. Almost a year later, the branch has been unable to fill these positions because the acting administrator has not addressed questions raised by the department’s personnel office regarding the program manager position. According to the acting administrator, the inspector positions cannot be filled until a program manager is hired to develop a training program. As a result, the branch is unable to resume its inspection duties or fulfill its responsibilities.

 

Hawaii Over The Past 20 Years: Minimal Change, Minimal Growth. What Should Hawaii Plan For?

Annual U.S. Bureau of the Census data strongly suggest that Hawaii, and Oahu in particular, are stable communities with very mild growth and change particularly after the turn of the millennium.

The data suggests that mega-projects such as rail and "big wind", and mega-developments such as Ho'opili and Koa Ridge are ill conceived and unnecessary.

This slideshow provides both data evidence and brief discussion.

Politicians have engaged in biased or data-free decision making for decades. The mounting debts are sufficient proof that ignoring the trends and serially engaging in unproductive activities simply digs a deeper hole. Both Hawaii and the US are approaching the danger of the hole walls caving in and burying them, much like the PIIGS* and other countries.

What should Hawaii do in the next two decades?  The last slide provides the answer. In three sentences:

• Decline followed by stability will be the trend.
• Send “visions” and mega-projects to the cemetery.
• Maintain, Replace, Modernize should be Priority 1.

(*) Portugal, Ireland, Italy, Greece, Spain

U.S. Titanic

Cox, a former chairman of the House Republican Policy Committee and the Securities and Exchange Commission, is president of Bingham Consulting LLC, and Archer, a former chairman of the House Ways & Means Committee, is a senior policy adviser at PricewaterhouseCoopers LLP.

On November 26, 2012 the Wall Street Journal published their opinion... Why $16 Trillion Only Hints at the True U.S. Debt: Hiding the government's liabilities from the public makes it seem that we can tax our way out of mounting deficits. We can't.

It explains quite well that the cartoon below is quite real.

Oahu Is Rising

Literally!

This is not about economic growth, intellectual enlightenment, or attaining some other form of excellence. 

This is a matter of fact statement about the geography of Oahu: It is rising. Every century the Koolaus will grow taller.

Contrary to global warming theories that for decades have suggested that Oahu’s shores will be inundated and beaches will be lost, new scientific analysis shows that even with possible sea lever rise, and even with the constant erosion of the island by wind and rain, Oahu will grow taller thanks to strong volcanic forces that lift it up from the bottom of the ocean.

The effects of climate, soil thickness, and water contact times on Oahu, Hawaii is the title of the article by Stephen T. Nelson, David G. Tingey, and Brian Selck from the Department of Geological Sciences, at Brigham Young University, in Provo, Utah.

Here is their remarkable conclusion: “Recent work indicates that Oahu is tectonically emerging at 0.060 m/ka. As long as this uplift continues, the net size of the island will slowly increase and the Koolau Range should persist as an orographic trap to precipitation, maintaining relative aridity in the Waianae Range.”

That’s 6 cm every 1,000 years. Not sure if that's enough to protect from any sea level rise due to polar ice melting.

Hawaii's Sudden Economic Tsunami

With the sudden death of US Senator Inouye and the retirement of US Senator Akaka, both in December of 2012, Hawaii instantly finds itself at the center of an unprecedented fiscal tsunami due to the total loss of Congressional seniority. The table below indicates that Hawaii's Congressional Seniority changed overnight from stellar to abysmal.

Although well over half of federal funds are appropriated by formula, a large share of local programs are funded by special appropriations and earmarks which would be very hard to obtain in the coming years.

Recent preliminary research by a group of students at UH placed the annual impact of Senator Inouye to Hawaii between $200 Million and $450 Million per year. The students surmised that the sudden loss of Senator Inouye would be similar to the sudden and complete loss of Hawaiian Airlines.

An expanded discussion by Malia Zimmerman "Hawaii, Like Alaska, Could See Huge Fiscal Impact From Loss of Congressional Seniority" combines multiple sources to provide additional information about the financial impact to Hawaii.

-------- January 11, 2013 Update -------- 

 Within about two years, I guestimate that Sen. Inouye's death combined with Sen. Akaka's retirement and the absence of no reps from Hawaii in an Appropriations Committee to cost:

•     ~ 200 high paying military contract jobs (civilian)
•     ~ 800 normal paying military contract jobs (civilian)
•     ~ 300 high paying UH research jobs
•     And a few dozen other millions in gravy
•     For a total of at least $200 Million per year of taxable income and related economic activity.

After a couple of years, the East-West Center, UH's Kakaako Medical Research Center, Mauna Kea astronomy investments, many small subsidized programs and the Armed Forces may be in jeopardy for major cuts.

The World in 2030: World Preeminence for China, Energy Independence for USA

The Verge: The US National Intelligence Council, representing the 17 intelligence agencies of the US government, says that "we are at a critical juncture in human history" in its fifth Global Trends report. The report details the challenges facing the species in the coming decades; the council says that many positive developments in health, education, and governance will propel human civilization, but that the threat of conflict could emerge as supplies of food and water become more scarce.

The Diplomatic News: The American Century is drawing to a close, and the US Defense Department will have to be more flexible in dealing with a faster-paced multipolar world, according to the Global Trends 2030 report

NY Times: A new intelligence assessment of global trends projects that China will outstrip the United States as the leading economic power before 2030, but that America will remain an indispensable world leader, bolstered in part by an era of energy independence.

London Financial Times:

• Pax Americana ‘winding down’
• China will be the world’s largest economy by 2030 but the US will still remain “first among equals” in the international system
• Europe, Japan and Russia will continue to experience relative decline
• Asia will come to dwarf the rest of the world in terms of its economic and military power
• The wave of Islamist terrorism is likely to have ended by 2030
• The US will be energy independent and could be a significant exporter of energy
• Advances in manufacturing technologies could reduce the need for outsourcing

Here is what the report says about renewable energy. It makes Hawaii look like a fool by wasting millions of taxpayer dollars to produce Kilo-Watts instead of Mega-Watts (1 MW = 1,000 KW):

"With shale gas, the US will have sufficient natural gas to meet domestic needs and generate potential global exports for decades to come. Increased oil production from difficult-to-access oil deposits would result in a substantial reduction in the US net trade balance and faster economic expansion. Global spare capacity may exceed over 8 million barrels, at which point OPEC would lose price control and crude oil prices would collapse, causing a major negative impact on oil-export economies."

"The IEA’s baseline scenario shows the share of renewables rising just 4 percent during the 2007-2050 period. Hydropower accounts for the overwhelming majority of renewables in this scenario, with wind and solar energy providing 5 and 2 percent contributions in 2050 respectively. Their contributions in 2030 would be even less."The 170 page report can be downloaded here: National Intelligence Council, Global Trends 2030

EPA and Caldwell Are Costing Honolulu $4.5 Billion for Sewers

October 2012 was the 40th anniversary of the landmark Clean Water Act (CWA). On this anniversary, the U.S. Conference of Mayors voiced concerns with what is seen as an increasingly unequal partnership with the federal government. The nation’s towns and cities face a “fiscal crossroads with affordability” as a result of the costs associated with the CWA.

  

Jim Suttle, the mayor of Omaha, Nebraska and former director of its public works department states that the EPA’s reliance on consent decrees is a factor that has impeded the search for innovative solutions to sewer overflows and other problems pertaining to clean water. He argues that the federal government must stop pursuing consent decrees and instead rely on the permitting process to manage water quality problems.

The U.S. Conference of Mayors brings up as an example Lima, Ohio, a town of 39,000 residents. To comply with the Clean Water Act, Lima devised a $60-million long-term control plan, but in 2005 the EPA rejected the plan, and has sought to impose a consent decree that would entail $104 million in capital costs. As a result, Lima’s population will face sewer rates amounting to 4% to 7% of their household income. The CWA compliance costs come to about $2,700 per Lima resident.

Honolulu is in a similar predicament with the overreaching consent decree that Mayor Hannemann signed with the EPA for secondary sewage treatment which is expected to cost no less than $2 billion (The $1.2 billion figure in this article is old and partial.) The same consent decree mandates a number of other replacements and upgrades that will cost about $2.5 billion for an approximate total cost of about $4.5 billion. The CWA compliance costs come to about $4,600 per Oahu resident, almost twice those for Lima residents.

These figures indicate that EPA has gone wild with its requirements for small and large cities. Michael Bissonnette, the mayor of Chicopee, Massachusetts has requested revisiting the consent decrees that are already in place. The U.S. Conference of Mayors is calling on Congress to amend the CWA to make it less burdensome to local governments. The group wants a cap placed on costs to ratepayer associated with unfunded water mandates.

In Honolulu, KITV has already reported that local residents are calling the Board of Water Supply because they can’t afford to pay the rapidly escalating water and sewer rates. (View KITV story.) Therefore, high on the agenda of the new mayor of Honolulu should be the revisiting of the exorbitantly expensive EPA consent decree. This however, would be highly unlikely with mayor-elect Caldwell because he considers this outrageously expensive agreement as an accomplishment.

Less Traffic Thanks to Telecommuting and Young Adults

"In 1888 Bertha Benz, wife of the carmaker Karl, drove 66 miles from one German city to another to prove to the world that the “horseless carriage” was suited to everyday use. Mrs. Benz succeeded beyond her wildest dreams."

This is The Economists' introduction of an article on urban transportation and the evolving trend of less car travel: "The road less travelled: Car use is peaking in the rich world. Governments should take advantage of that." Less travel? Can this be right? See Figure 1 below.



A few more quotes from the full article "The future of driving -- Seeing the back of the car -- In the rich world, people seem to be driving less than they used to" are as follows:

• Modern life is unimaginable without the car. The automobile has powered the growth of cities and steered their sprawl. Its manufacture has created millions of jobs and eased the development of many millions more.
• Cars are integral to modern life. They account for 70% of all trips not made on foot in the OECD, which includes most developed countries. 
• In the European Union more than 12 million people work in manufacturing and services related to cars and other vehicles, around 6% of the total employed population.
• The equivalent figure for America is 4.5% of private-sector employment, or 8 million jobs.

An interesting revelation of the research reported in The Economist is that current and future young people tend to travel less. There are several reasons for this:

1. Young people tend to socialize more via digital media and meet less often.
2. Car use has become more expensive for young people's parents to afford a car for them or for the young people to afford the sky-high insurance fees.
3. At least some of young people's college or professional education can be via distance learning.
4. Job opportunities for young people are less and lower rewarded in the stagnant economy of the EU and of several debt-laden states in the US.
5. Young people are getting their licenses later than they used to (see Figure 2 above.)

In addition the full democratization of the automobile (meaning that women own and use cars at rates similar to men) concluded at the end of the last century. So this "catch up" trend leading to traffic growth has ended.

More and safer bikeways, subsidized vanpooling, supported telecommuting and, in some cases, clean and reliable mass transit chip away at the dominance of the car. See for example below the gains in vanpooling and telecommuting in Washington State.



Recall that Honolulu rail will increase transit share roughly from 6% of TheBus today to 7% for combined bus and rail. It would be much easier to obtain this 1% with more vanpools and telework!  There is a real world example  for this: Portland, the poster child for light rail. From 1980 to 2011, working at home (mostly telecommuting) increased by 55,000. This is more than three times the growth in rail transit commuting (17,500). During the last decade, working at home passed transit as a work access mode in Portland, and with virtually no public expenditures as opposed to the billions spent on rail lines.

Island Heavy Rail Calamity: San Juan Repeats in Honolulu

Tren Urbano (or City Train) in San Juan, Puerto Rico is a perfect comparison with Honolulu's heavy rail:

1. Both are heavy rail systems with a very high cost per mile of rail line.
2. Both are systems on similar tourist/agriculture/military island communities.
3. Both are under Federal Transit Administration oversight.
4. Both received US federal funds.
5. Both have the same lead planner, Parsons Brinkerhoff.

I have written in the past about Tren Urbano:

• The Delusion and Deception in Rail Forecasts.
• Honolulu Rail Forecast 2 to 4 Times Higher than Actual Systems.
• Edinburgh Light Rail Halted. The Usual Suspects. The Usual Results.

Recently, Cliff Slater of HonoluluTraffic.com has developed a documented 2-page summary of the consequences of Tren Urbano such as:

• Huge escalation of construction costs (+74%).
• Huge escalation of combined bus and rail operation and maintenance cost after the line was opened (+250%).
• Downgrade of Puerto Rico’s bond ratings.
• Dramatic decline of total transit ridership (bus and rail) because the Tren cannibalized their bus. This is happening to TheBus now.
• It is now more than five years since its opening and Tren has not reached 50% of its opening year forecast ridership! (See link above where I provide comparisons that show HART ridership estimates are 2 to 4 times too high.)

Now all these terrible transit and financial outcomes occurred in San Juan where population is much higher, and average income and car ownership is much lower than Honolulu's (see 2000 data below). The Tren (like history) is repeating itself in Honolulu. The deliberate discounting of history by current elected officials and certain candidates is truly bewildering.

Why Rail Is Bad for Honolulu...

I agree!

Honolulu Rail on Trial

Malia Zimmerman interviews Professors Randy Roth (law) and Panos Prevedouros (engineering). In this video filmed on O'lelo's Palolo studio a week ago, Professor Roth correctly predicts the outcome of the State Supreme Court. See below.

Congratulations to Paulette Kaleikini and her native Hawaiian hui for scoring this legal victory: Rail Construction Shouldn’t Have Started, Hawaii Supreme Court Rules. In other words, Mayor Carlisle and HART clearly broke the law.

Ninth Circuit Court Judge Teshima heard the Federal Lawsuit against Honolulu rail. Listen to the YouTube above where I indicate how the attorney for FACE clearly lied to the judge. Professor Roth expects that this lawsuit will also be successful. Decision expected in a couple months.

Faith-based Transportation Policy

Washington Post, George F. Will, A Golden State train wreck, August 8, 2012.

• In faith-based transportation policy, rail worshipers think people will park their cars in Tampa and then rent cars in Orlando.
• California Governor Brown’s reverence for his rail bauble is fanaticism.

How will people in Honolulu

• go to their second job ...
  
• manage their school and job ...
• take kids to school ...
  
• go surfing ...
  
• go eating ...
  
• go to their doctor, hospital, blood test lab, dialysis location ...
  
• do their groceries and run other errands ...
  
• have a diverse and fulfilling life ...
  

... without the independent transportation on roads with cars and buses that serve all neighborhoods?

Railigion is the affliction or belief that most "other people" will be able to use the rail regularly to make the trips that take them to the activities above. This is faith, affliction or outright stupidity. Whatever you call it, professional and responsible transportation planning is not.

Godfather of Global Warming Is Less Alarmed Now

Professor James Lovelock is a world-renowned scientist and environmentalist who had a major impact on the development of global warming theory. As the Toronto Sun describes him: Unlike many “environmentalists,” who have degrees in political science, Lovelock, until his recent retirement at age 92, was a much-honored working scientist and academic.


In recent interviews Lovelock has made these rather starling declarations:

1. He had been unduly “alarmist” about climate change.
2. He's been a long-time supporter of nuclear power as a way to lower greenhouse gas emissions.
3. He is in favor of natural gas fracking extraction because natural gas is a low-polluting alternative to coal.
4. He believes that ‘sustainable development’ is meaningless drivel.
5. He "can’t stand windmills at any price."
6. He "blasted greens for treating global warming like a religion."

I am truly humbled to be in agreement with him, 5 for 5, with first five arguments: climate change, nuclear power, fracking, sustainable development and windmills. I have not yet written an article blasting greens (although I often refer to them as pseudo-greens) because I've been rather busy countering the railigious.

Sources

• Green ‘drivel’ exposed: The godfather of global warming lowers the boom on climate change hysteria
• 'Gaia' scientist James Lovelock: I was 'alarmist' about climate change
• James Lovelock: The UK should be going mad for fracking

Electric Vehicles: Another Government Bet, Another Taxpayer Loss

I quote below a summary by Robert W. Poole, Jr., Director of Transportation Studies, Reason Foundation that he originally titled What's Wrong with Electric Cars?
=================================================
Several years ago in this newsletter (prior to the debut of the Chevy Volt), I celebrated the vision of a future of zero-tailpipe emission cars, powered by breakthrough battery technology. Articles on advanced batteries were appearing in respectable places like MIT's Technology Review, and Silicon Valley venture capitalists were ramping up funding of electric vehicle (EV) and advanced-battery startups. With the coming of practical, zero-emission vehicles, I hoped, a lot of the anti-car, anti-highway ideas that I disagree with could be dismissed as irrelevant.

Alas, several years later, things don't look so bright for EVs. Canadian columnist Margaret Wente, writing in The Globe and Mail last fall, summed it up as follows: "As Dennis DesRosiers, a leading auto consultant points out, consumers simply won't pay a $20,000 premium for a vehicle that doesn't go very far, isn't very convenient, and runs out of juice as soon as you turn on the air conditioner." And that, I think, neatly explains why:

• sales of the highly touted Chevy Volt totaled just 7,671 last year, and
  
• the Nissan Leaf did only marginally better at 9,674.
  
• The Daily Mail in London reported that only 2,149 EVs have been sold in Britain since 2006.

Wall Street Journal auto industry analyst Joseph White in February penned a detailed comparison of the Chevy Volt and the conventionally powered Chevy Cruz, about the same size but selling for half the Volt's $40,000 price. The Cruz is breaking sales records, while the Volt is a dud. The underlying problem is simply that despite lithium-ion batteries being far superior to the lead-acid batteries that powered GM's previous electric car (the EV-1), they are still heavy, costly, and vastly less efficient at storing energy than that miracle fuel, petroleum.

For EVs like the Volt, Leaf, and Ford's Focus, the battery pack costs $12-15,000, about one-third the cost of the vehicle. And that is despite $1.26 billion in federal subsidies to battery producers over the last several years. There may be some future battery technology that will represent a breakthrough in energy storage, but lithium-ion clearly is not it.But that has not stopped the government's multi-front program of jump-starting an EV industry based on flawed technology.

Besides grants and loans to battery companies, the Department of Energy and the Administration's stimulus program have put some $9 billion for EV production into major auto companies like GM and Nissan as well as a whole raft of start-ups such as Tesla, Fisker, Bright Automotive, Think, and even truck-maker Navistar, which got $2.4 billion to jump-start production of an electric truck called eStar that has found few buyers. (A number of the smaller start-ups have already filed for bankruptcy.) In addition, of course, buyers of EVs get a $7,500 tax credit (which the Administration's current budget proposal would increase to $10,000). That credit applies not just to the low-end Leaf and Volt but also to the $100,000 Fisker Karma and Tesla roadster.

The average household income of Volt buyers is around $170,000, and I'm sure those who have put down deposits for Fisker and Tesla EVs are in far higher brackets. What kind of public policy sense does it make to subsidize playthings for the rich?

The whole federal push to jump-start an EV industry is misguided. As former Treasury Secretary Larry Summers has said, "The government is a crappy venture capitalist." In a field where true breakthroughs are needed if a practical, cost-effective EV is ever to emerge, government funding of basic research and development might be justified. But the attempt to shape and micro-manage the development of an industry is a recipe for massive wasting of resources. As former chairman of the Council of Economic Advisers Michael Boskin put it in a Wall Street Journal op-ed in February, "Industrial policy failed in the 1970s and 1980s. Letting governments, rather than marketplace competition, pick winners and losers is just as bad an idea today.
=================================================
I should add that while in South Korea last month I read "China's dream of electric car leadership elusive" and I quote:
In 2009, [China] announced bold plans to cash in on demand for clean vehicles by making China a global power in electric car manufacturing. They pledged billions of dollars for research and called for annual sales of 500,000 cars by 2015. Today, Beijing is scaling back its ambitions, chastened by technological hurdles and lack of buyer interest. Developers have yet to achieve breakthroughs and will be lucky to sell 2,000 cars this year, mostly taxis.

The Ho'opili TIAR is Unacceptable

A critical element in approving any land use changes is the Traffic Impact Analysis Report or TIAR. The Friends of Makakilo and Save Oahu's Farmlands Alliance asked me to review B. R. Horton's TIAR submitted to the state's Land Use Commission (LUC) as part of the process for obtaining the approval to convert prime agricultural land to a residential development.

Let me quickly dispense the argument that my review of the Ho'opili TIAR may have been biased by the fact that Ho'opili contains two rail stations and is being billed as an exemplary Transit Oriented Development (TOD) of the proposed rail which I oppose.

The TIAR shows that Ho’opili’s transit trips are modest. If 50% of transit trips are made by rail, this results in 166 riders in the AM peak hour -- two bus loads and that’s it:
• Ho’opili does not work for rail proponents because it generates manini ridership.
• Ho’opili does not work for rail opponents because deleting it does affect the projected rail ridership substantially.

The first phase of Ho'opili barely justifies a basic bus service and the full development may benefit from limited express bus service. But as a ridership generator for rail, it is worthless, as all suburban TODs are. Suburban development and rail never go together.

Now back to the TIAR and why LUC should reject the petition on the basis of an inadequate TIAR alone.

“The planned year 2020 level of development is expected to occupy approximately one third of the total Ho’opili project site” stated on page E-2 is a hugely important statement. This means that all outcomes presented in the TIAR are only 1/3 of the whole. This is a “salami tactic” to get Ho’opili going without any disclosure of its total effects. A whopping 67% of the Ho’opili’s total effects are nowhere to be found. Therefore, this report should be deemed UNACCEPTABLE without at least an illustrative (approximate) full build-out scenario along with mitigations and final impacts. These numbers are simply “cheating” both decision makers and the community as they omit 67% of the potential impacts.

In the study’s Methodology for Freeway and Junction Analysis, the “… operating conditions were evaluated using the HCM 2000 methodology.” The current version is HCM 2010, but that’s a minor problem. HCM is not an appropriate tool for this application. The Federal Highway Administration (which has H-1 Freeway oversight) does not recommend such simple models for complex corridor and freeway analysis because they ignore congestion effects. The freeway operations in the Ho’opili area are dominated by the H-1/H-2 merge and other secondary bottlenecks. The TIAR’s segment by segment freeway and ramp analysis is entirely inappropriate. Also the H-1/H-2 merge is totally absent, therefore the presented results are UNACCEPTABLE.

The TIAR preparer assumed that Ho’opili will adopt a Traffic Demand Management composed of nine (9) major actions such as extensive biking, carpooling, tele-work, etc. Absolutely no other place in Hawaii has any four of these nine TDM actions occurring at the same time so at best this is a pie-in-the-sky assumption that artificially reduced the traffic impact of Ho’opili.

The TIAR preparer claimed that the Oahu MPO planning model allows them to take an up to 30% trip reduction due to the integrated character of the Ho’opili community. However, there is no proof that this is a valid or prudent assumption. I cannot think of a more integrated community on Oahui than Kalilhi. Arguing that Kalihi folks make 30% fewer trips is baseless and likely wrong. These multiple traffic reductions make the assessment of Ho’opili’s traffic impacts.

The freeway mitigations shown in the study are localized band aids and none of them address the merge of the H-1 and H-2 freeways. Worse yet, I note that the furthest downstream section of their mitigations is always a 3-lane “choker” so all these actions actually force more traffic flow onto bottleneck sections. The proposed freeway mitigations are UNACCEPTABLE.

The LUC Docket A06-771 “2020 TIAR” that I reviewed includes over 300 pages of computer traffic analysis output. All of it with simple Equation Type models, which are inappropriate for congested freeway corridors, as mentioned above. What I found surprising is that the memo for freeway analysis relating to Ho’opili agreed upon by State DOT, and two consultants of B. R. Horton is dated October 9, 2009 but nearly all of the computer outputs were dated August 20, 2009. So: (1) Freeway and ramp analysis was done before the State/Developer MOU, and (2) This TIAR is stamped “April 2011 update” but the traffic analyses are from summer 2009.

The TIAR states that “neither the City and County of Honolulu nor the State of Hawaii have guidelines for identifying the transportation impacts caused by the project.” This is a sad statement for our city and state and it is true. Solid technical criteria for the judgment of properly quantified traffic impacts are absent. Therefore, developers hire consultants to present a picture of the impacts and then government and top level decision makers arrive at an ad hoc determination about what’s wrong with the picture, if anything. This simply perpetuates arbitrary, capricious and favoritism-prone decision making.

Regardless of the lack of City and State criteria, the outputs of this analysis are by and large worthless. The report describes the 2020 plan with only one third of Ho’opili developed. The partial and biased TIAR of questionable methodology should be found UNACCEPTABLE for permitting the conversion of prime agricultural land to any other land use that obliterates the current active agricultural use of the land.

Can We Solve Honolulu’s Pervasive Traffic Congestion Problem?

Yes we can!

There are several specific projects that mitigate congestion that if one could magically install half of them overnight, Honolulu’s congestion level would be so low that traffic congestion would be removed from people’s list of worries. That would be a great thing for quality of life on Oahu and a booster to our tourism and the overall local economy.

Part 1 gives some background on congestion (did you know that some congestion is a good thing?) and presents low cost and shorter term traffic congestion solutions. Part 2 presents longer term, high cost traffic congestion solutions.

Honolulu Traffic Congestion – Part 1: From Bumper-to-bumper to Zoom-zoom by Removing One Third of Honolulu's Traffic Congestion for Less Than $500 Million

Honolulu Traffic Congestion – Part 2: Up-shift to Overdrive by Removing another One Third of Honolulu's Traffic Congestion for Less Than $5 Billion

These two white papers illustrate the dozens of doable, affordable, all-local-labor and effective projects for mitigating one of our largest problems on Oahu, traffic congestion.

Traffic congestion mitigation in Honolulu is in the hands of government and politicians. They may actually be the main causes of our traffic congestion.