Subprime Nation

Hot, Flat, and Crowded is about two problems: the world’s problem, and America’s problem. The world’s problem is that it is getting hot, flat, and crowded. But what’s on my mind especially today is America’s problem. America has lost its way in recent years – partly because of 9/11 and partly because of the bad habits that we have let build up over the past thirty years, bad habits that have weakened our society’s ability and willingness to take on the big challenges.

As I put it in the book: “In some ways, the subprime mortgage mess and housing crisis are metaphors for what has come over America in recent years: A certain connection between hard work, achievement, and accountability has been broken. We’ve become a subprime nation that thinks it can just borrow its way to prosperity..."

I argue in the book that the best way out of this mess is an American commitment to what I call "nation-building at home," centered on innovation in clean energy. The crisis on Wall Street makes clear that America really does have a problem and that we really do need to commit to "nation-building at home," and fast. As the government asks all of us as citizens to assume responsibility for the financial crisis, what should we be asking of it in terms of "nation-building at home"? What should we be calling for on top of greater regulation of the financial markets if we are going to get our country back on the right track?

Ideas:

Change the capital gains tax to zero if the capital is deployed within the US and creates jobs for US citizens.

Joe Snyder (not verified)
April 25th 2010, 10:59 am

Thomas,
America has lost its way in recent years – partly because of 9/11 and partly because of the bad habits that we have let build up over the past thirty years, bad habits that have weakened our society’s ability and willingness to take on the big challenges.

Bad habits such as making up "Alice in Wonderland" theories in order to avoid the big challenge of the lack of jobs available right now. In, The World is Flat, you attributed this problem to a lack of ambition amongst American youth. You said, "we should be embarking on a...crash program for science and engineering education immediately." However, this solves nothing and has nothing to do with a lack of ambition among Americans. It is rightly pointed out in Aronica's book The World is Flat? that you "hold the Alice in Wonderland view that we can solve our current problem of unemployed engineers and scientists by producing more engineers and scientists."

Jennifer (not verified)
September 11th 2009, 8:37 am

The problem with America is that will forget how greed got this country in this mess. Its frustrating how people's greed has affected the rest of us.

As a real estate development professional I see that the banks have stopped lending on any type of construction. We have retailers and other tenants and we can't get financing. Without financing we can't get construction started which limits jobs on many different levels.

Even though there are problems in America it still is the best country in the world. Take a look at all the countries in the world, what other country would you want to live in http://www.republic-flag.com/country-flags-of...

Bruce Anderson (not verified)
August 19th 2009, 12:33 am

Hello Mr. Friedman

In the hot, flat and crowded world, where do the American high school drop outs fit in? I think the issue of having a 30% high school drop out rate nationwide is going to create a lot of crevices in the flat world. Unless we as a society find a way to keep this 30% in school or offer a mandatory civil service, military, trade school option to staying in high school,these crevices will continue to result in social fissures.

I work in the field of education and so I'm aware of the high school drop out problem. But do the people of the United States understand that if 30% is not educated or skilled to contribute to society, that this 30% will resort to whatever means necessary to support themselves? I live in Memphis and we have close to a 50% high school drop out rate. It is this 50% who are contributing to the high rate of crime in Memphis and negatively affecting the city rather than contributing to the workforce and positive human energy.

When I speak to peolpe in my community about the drop out factory we have in Memphis, the common response is "If they drop out, then they will have consequences." What society fails to see is that "their" consequences are our consequeces. We would be so much better off as a society to find a way to keep the 30% in high school. And if they choose not to go to school, then they should be forced to choose between trade school, civil service, military service or some form of work that contributes to their personal development and the society's well being. It should be unacceptable to the American public to allow 30% of our young people to fall into the crevices and "disappear".

Admiringly

Deborah

Deborah (not verified)
April 18th 2009, 1:47 pm

Here is an idea I tried to share with President-Elect...but it was 'returned to sender'..unopened! Let's call this version my Open Letter to Obama
:
Please, pick up the phone and call Eric Schmidt (Google), Steve Jobs (Apple), Sam Palmisano (IBM), Carter Cast (Walmart), John Rice (GE) Rex Tillerson (Exxon), Rayford Wilkins (AT&T), Bill Gates (Microsoft) and a few other of the iconic US companies, like Sun Microsystems.

Ask them to stop any layoffs. Delay if they can, but if they must take down US employees, do it through voluntary programs. We lost over half a million jobs in November, and the January numbers will be much worse unless someone takes action now. It has to be you. This is your moment: these great American companies are taking jobs away with a cleaver, but you could ask them to hold off or if they must, use a scalpel.

Then, tell them you need them to forge a national alliance of businesses and government, aimed at rebuilding the US job force. Put theses executives to work as your first National Service Team, to determine how to keep jobs here. We hear that this is “like the Great Depression” but it is not. Some companies (like AT&T ) worked to keep people employed during that time. Government and business worked together in the social programs of the 1930s. Now, many American companies are lining up to divest the US labor force to low-cost countries, or to wholly eliminate the very jobs than fuel the recovery.

We – government, businesses, citizens – need to fight to keep jobs here. Like you and me, many of these executives have never had to go fight in a war. But keeping good jobs in the US is a fight as important as many military ones. You can ask them to fight to keep jobs here in an unprecedented partnership of companies and government. Tell them to put their American flags pins back on and ask them to work with you on building a jobs ecosystem in the US – not in India, not in VietNam, not in Slovakia. Build it here. Tell them “yes, we can” and make it an act of patriotism in which they must participate.

Luckyfish (not verified)
January 9th 2009, 2:08 pm

Mr. Friedman:

Here's a housing market idea. We are currently unable to claim a capital loss on a primary residence against income taxes. If we are commited to throwing around endless amounts of money why not take some of the bailout money and apply it to the decline in revenues that would result by allowing homeowners to sell their primary residence at a loss? Individuals could then take a portion of that loss off on their income taxes. This would allow the housing market to correct sooner by reducing unsold inventory and would reset home prices at more realistic values. Obviously this would require a well regulated appraisal process and a finite time frame for execution.

Anonymous (not verified)
January 4th 2009, 7:36 pm

With the recent collapse in the banking, automotive, and insurance industries plus the recent fraud of money manager Madoff it seems that we need to revisit the assumption that American business can compete globally. In fact it seems and our issues are big business has been running on empty for some time. Business calls it leverage, most of us call it mortgaging the future.

I suggest this situation has been 20+ years in the making and stems from Wall Street expectations and executive compensation. You might call it the GE/Welsh syndrome.

Chapter 18 may want to explore the deeper societal issues that are currently being propagated by our leadership, both political and commercial. While government policy is certainly at issue it may very well only be a symptom of a broader societal issue that permeates government, business, and cultural integrity.

Scott DeShetler (not verified)
December 15th 2008, 9:54 am

In regard to the world's problem and America's, I'd like to mention about a documentary I had watched recently. The film titled The World Without US, juxtaposes the simplicity of American populists who call for cessation of our international activities with the potential horrors that could arise if this country chose to withdraw and allow the various powers of evil to run rampant, reminiscent of the 1930s when Germany, Japan, and Italy conquered great swaths of the map. This documentary also brings Ayn Rand's Atlas Shrugged to mind as the stability of the world is shown to be so precarious without America's forthright wilingness to intervene in locales that the average citizen could not find on the map, ranging from the military action in the genocide perpetrated in the aftermath of Yugoslavia's dissolution to the bulwark the US provides in defending North Korea from destroying South Korea. It doesn't show us anything we probably don't know about, it doesn't tell us anything we probably haven't already heard, but it reminds us of a lot of things we have quite possibly forgotten about or ignored.

Anonymous (not verified)
November 17th 2008, 11:34 am

I have read both "The World Is Flat" and "Hot, Flat and Crowded". I find it extremely frustrating as an individual to see the special interests and lobbying groups throw money into saving the "status quo" and to keep doing business as usual and for the lawmakers (or whatever you want to call them) to keep going along rather than to show real leadership and see what is on the horizon concerning global warming and petrodictators and not creating mandates and tax policies conducive to promoting an eco energy system that would benefit us all here in the US and the world. I sure hope that Obama-Biden will provide the leadership along with a super majority in the Senate and House and be able to push back the doing business as usual and thrust us forth into the 21st century for clean and renewable energy for all. I wish there was more I could do as an individual to propel all this forward. People with resources such as Gates, Buffett and others could lead the way. Here's to hoping that we all see the light before it's too late.

Jim (not verified)
October 19th 2008, 8:08 am

A PLAN OF SUBSTANCE FOR CONSIDERATION. Hall Fletcher School of Math, Science, and Technologies in Asheville, NC wishes to be a platform for alternative energy innovation. We are currently putting together a plan which will offer a prize of $500,000 to an individual or group who can retrofit our school into a building that is 100% energy sustainable.

Mr. Friedman, you wrote in your book how we need to foster thousands of creative folks to implement thousands of ideas in order for the US to become energy independent. Our plan does that. We plan to approach political, business, and community leaders to contribute finances and advice on this project and its prize. This would be a project pulling in all interested parties in the southeast for which energy independence is a concern.

But we need your help. The first person we approach will ask, “Who else is on board with this idea?” We wish to have your endorsement so when we approach folks with our vision we have in our hands a statement from someone, such as yourself, who is greatly respected for his knowledge and passionate advocating of this issue.

Hall Fletcher is an inner city elementary school (K-5) with a minority population of 75% and a poverty rate of 80%. But it has met all North Carolina ABC’s and No Child Left Behind AYP goals, benchmarks, and standards since the inception of those respective legislations.

Most importantly, in March, 2006 Hall Fletcher was awarded the national Future Ready Prize of $250,000 from Microsoft, Dell, and Intel.

http://findarticles.com/p/articles/mi_m0EIN/i...

http://education.zdnet.com/?p=78

I wrote an essay outlining our technologies plan for 2004-2009 and out of 1500 nationally submitted entries ours was selected by Bill Gates and Michael Dell. We have the credentials to implement a large project.

Then, your book, The World Is Flat, was my foundation, and now your present book, HFC, serves in that role.

As I searched the Internet, scoured magazines, and read books like yours I found the discussion of energy sustainability bouncing around from energy alternative activists to politicians to utility spokesmen to interested bloggers then to energy alternative activists to politicians to utility spokesmen to bloggers again. It reminded me of the Joni Mitchell song “…going round and round and round in the circle game…”

Hall Fletcher MST wants to take action for our students, their parents, the community at large and our own children and have our school serve as platform for innovation in energy sustainability.

We respectfully request your help, your endorsement, and support. If you need more details of this unique endeavor, please email me. Respectfully, Rocko Smucker

Rocko Smucker (not verified)
October 12th 2008, 7:26 pm

I've read The World is Flat and I am reading HFC now. While I often disagree with Mr. Friedman's conclusions and interpretations of facts, I do enjoy the discussion of such important matters and I am sometimes forced to rethiink my own positions.

However, in terms of the subprime nation issue, I feel that Mr. Friedman's background as a modern-era American economist blinds him to an important historical truth: Taxes should be much higher. Historically, the nation paid substantially higher taxes during WWI, WWII, Korea, and Vietnam (rates generally in the 70%'s and up to 94% for the top tier, and in the 20% range for the rest of the people). During great eras of prosperity, we were also paying extremely high taxes. When the "greatest generation" went to war, they paid for it. Just look at some basic numbers here -http://en.wikipedia.org/wiki/Income_tax_in_th...

The first Gulf War was the first time that we actually LOWERED taxes during a war. To my mind, it was the first time we ever decided that we who stayed home deserved none of the sacrifice while our soldiers would bear all the costs. In shameless self-interest this quickly became the norm, and we did it again during the second Gulf War - lowering taxes to make our own lives easier while our soldiers suffered.

All of us, politicians, citizens, and academics, have been most willing to hear the economists who insist that low taxes are universally best. It serves our personal, immediate, and selfish interests to do so. But it just ain't so. Our artificially low taxes and the debt that these policies have led to, are dishonest, selfish, and foolish. These economists focus on growth and standard of living, but not the strength of the economy. To me, it's like judging a person's health based solely on her height and weight - and coming to the insane conclusion that the tallest and heaviest people are most fit.

Increased taxes will restore American prosperity and honor. True, we will own less, eat out less, and vacation less. But we will OWE less and, on a true balance sheet, be more prosperous. More importantly, we will all be honoring our soldiers abroad and America as a whole - not with jingoistic slogans and flag waving, but with true sacrifice.

As a final note, to those who will inevitably suggest that I'm suggesting that we RAISE taxes, you're wrong. I'm suggesting that we PAY the taxes that are due. It's time to face up to this honestly. If you had dinner at a restaurant and put down $10 when the check clearly stated that you owed $20, the waiter would not be "raising your bill" by asking you to pay $10 more. If you refused to pay, it wouldn't make you a fiscal conservative. It would make you a cheat.

Steve Moore (not verified)
October 10th 2008, 1:16 pm

One recent issue re "Subprime Nation" and the recent Sarah Palin column: Friedman ignores one important point re taxes and the Obama "tax relief for the middle class" proposals: The less people pay in taxes, the lower their stake in how government spends -- or now, borrows to finance bailout, etc. Obama would remove more folks from the tax rolls, minimizing their incentive to scrutinize policy proposals and maximizing their interest in protecting their narrow interest in receiving government largesse (paid for by others).

JBR (not verified)
October 10th 2008, 9:27 am

I am currently listening to Chapter 17 of the Audible version of HF&C (or as I call it, Hot, Flat and Long.) I joke about the 16+ hour length of the book, but it has been an intriguing read. Even better, it has stimulated thought and made me work to justify my beliefs or even think about changing some of them.

While I am a technologist and I am extremely interested in clean energy production and transportation, I keep coming back to the question of "If it is so obvious that we need to do something about our energy situation, why is it so much trouble to get it done?"

I have come to the conclusion that as much as Al Gore has become a Green Messiah to the left, he is a Green Devil to the right. And there is the rub: this should NOT be a left/right issue, but it has become one and it is so entrenched now that it will take massive amounts of willpower (and energy) to extricate the issue from the partisan wastelands of American Politics. You see, Al Gore aligned himself with the fringe left whose agenda is mostly anticapitalist, antiprogress, antipeople, anti-Bush, anti-anything that goes against what most people (and all conservatives) hold dear. Once he did that, he immediately plugged the ears of 50% of the American population (give or take 0.5%) to his cause.

Being one of the unbelievers, I am still skeptical of the claims of manmade climate change. Yes, I believe that the planet is slowly warming, but I am also aware that when Iceland and Greenland were settled by the Norse in the late 10th century, the islands were quite temperate. I am also well aware of the Little Ice Age that struck the Northern Hemisphere from roughly 1500-1850. Rivers froze in the winter, glaciers advanced and civilization was altered throughout the hemisphere. Winter land-bridges were commonplace between islands. If you were to ask people extant in the 1800's what was going on with the heating of the atmosphere, would they rejoice in the warmer climes, or complain about how their familiar climate of bitter cold in the winter is giving way to ruinous winters where the rivers don't freeze?

As advanced and as smart as we have become, I am struck by how shallow our collective memory is and how "the way things should be" usually stretches back no further than a generation or two. Our planet is 3.5 BILLION years old and in the book, Tom uses statistics from China citing 'record' temperature rises based upon meteorlogical records going all the way back to 1951!!!

My point in all of this is that man-made climate change, contrary to this book and hundreds of others, really is NOT settled science. Think back to the enlightenment era when scientists began questioning the 'settled science' of the established churches. The world really was flat back then. Even today, our researchers cannot decide year-to-year if it is oatmeal or red wine that prolongs our life. To base something as important as energy independence and sustainability on what is perceived as left-wing dogma is not only imprudent, but it is doomed to be stillborn as a national movement.

I propose that Chapter 18 be dedicated to reframing the premise of Hot, Flat and Crowded to Flat, Broke and Crowded (pun intended.) Carbon emission (along with cap and trade, and carbon taxes) is a straw man. Drop Global Warming as an issue. Show how our next President can seize the moment of economic disruption and use the basis of the Green Movement as a catalyst to propel the American society into the new Energy Economy. Sometimes the trick to getting things done is to make someone else think that it was their own idea. Call it the 'Tom Sawyering' of energy policy.

Tom Friedman (not Sawyer) makes a valid point in coming up with a price floor for oil or gasoline and while I agree with the need, I also see it as the most distasteful part of the equation. I don't see how you can start it off at $4.00/gallon of gas. It should be phased in over a 10 year period with an up-front scale, maybe starting at $3.00 and increasing 20 cents per year. We also have to be really careful about how the windfall 'floor-tax' gets collected and spent. ABSOLUTELY NO ONE trusts ANY politician around ANY pot of money. There probably would need to be a board of trustees that would oversee the money and the expenditures would have to be 100% transparent.

The key to making this all happen is having a President that has the vision and who takes a devil-may-care attitude toward the slings and arrows that will come his way... a modern day Teddy Roosevelt. Call me crazy, but I think we have a better chance with McCain-Palin to pull this off than with Obama-Biden, but I will leave that argument for another day.

(Check out the book "Internal Combustion" by Edwin Black. Tedious, but very interesting. They say past is prologue. This book sets the stage for any future struggle. Also check out http://the-asterisk.blogspot.com for an interesting idea to get us out of the housing mess.)

Randy Spangler (not verified)
October 9th 2008, 3:09 am

I wonder how the world's financial crisis will impact funding, both timing and amounts, for subsidizing alternative energy projects and a commitment by the U.S. government for a national energy policy that Mr. Friedman recommends? The very real and serious global financial crisis will be with us for quite some time and is a distraction from the environmental time bomb that keeps ticking. How soon will the new administration, whichever candidate is elected, and Congress, address the need for and create a new energy program as presented in "Hot, Flat and Crowded"?

Martin Kaplan (not verified)
October 6th 2008, 12:27 am

I always get depressed at people or programs that cheer the provision of more tax incentives to underwrite the high costs of energy alternatives. Underwriting alternative energy through tax support will ultimately end, and if these new technologies aren't cost competitive with petroleum, they will die taking all the investors money and enthusiasm down with them.

I would like to see more discussion of the financial and technical big picture. You did mention that major oil producing countries can destroy the current alternative energy business in the US at an moment by lower the price of oil, but you haven't really dealt with long term options available to protect these industries.

People need to understand the technical and financial hurdles standing in the way of self-sustaining alternative energy, and the National and individual sacrifices that will be needed if we truly want energy independence. Not doing this education on the hard problems just pumps up people's enthusiasm and leaves them skeptical and angry when the alternate energy future they envision doesn't
happen.

Deal with the hard technical problems in alternative energy. They aren't insurmountable, they just require time and investment, and help people understand why these industries may not ever compete on an even playing field (other than nuclear).

More importantly, deal with the harder financial issues. There are financially sustainable ways to support alternative energy in this country if we want it
badly enough. Clearly Europe has done this, and the energy costs there should be an example of what may be needed. But people need to understand that things like import duties on foreign energy, or your "floor" on fuel prices, while they can create self-sustaining alternative energy industries, will result in increased costs to individual consumers. If we want freedom from imported oil, we should be willing to pay the price. I fear that many of your programs promote the fantasy of non-petroleum energy and lower energy costs.

Ed Owens

Ed Owens (not verified)
September 30th 2008, 8:59 pm

Make The Energy Conservation A Market Pull Than A Policy Push:
-------------------------------------------------------------------------------------------

To make sure any strategy is implemented or any guideline incorporated, we need to get back to the good old rule of economics. Make the strategy, a market pull than push them from the other side. As we are aware, subsides and other sort of incentives that the governments provides have been in vogue on for a long time, without much effect. One can try changing the mentality for going Green by incorporating a two phased strategy.

Phase One:
Form a neutral organization in the lines of ISO, which would regularize the amount of conservation of energy and certify the organizations based on their Green mindset. The rating should not only be based merely on the methodology in use, it should incorporate the calculation based on how the company views the future and how the company plans to go Green in years to come. Additionally, it should also incorporate scoring system based on the results of a random survey the employees of the organization have to go through. Basically, the idea is, just don't go by counting the actions taken by the company, for that year. Instead rate a company based on their goals and how they have aligned the Green goals with the overall Growth Goals of the organization. By doing this we can make sure that there is a presence of mindset to Go Green.

Phase Two:
Provide tax rebates for the companies, who buy goods from the companies which have a higher Green rating. Meaning, for example: if a company A is planning to buy a refrigerator from two potential vendors B and C. With the rating in a scale of 1 to 5 (with 5 being the Greenest). If the company B is rated 4 and company C is rated 2. Then the company A could claim a Green rebate of say 5% of the cost of company, as they chose B.
This is to make sure the company A, feels the impact of going Green in its Bottom-Line and transfers the intent of going Green to the buyer than the seller. Thus resulting in a pull for Green mentality.

To Summarize to implement the same in two phases:
:: Form an organization in the lines of ISO to certify Green companies.
:: Provide incentives to the companies for buying the products from the Green companies, than providing incentives to the companies for turning themselves Green.

Ganesh D G (not verified)
September 30th 2008, 5:28 am

With respect to "Green the Bailout" - there's been some talk about where any profits gleaned from bailed-out companies will be directed. One impulse is to give them to the taxpayer, another to investing in new technologies - is there a way to do both? What if there was a surplus check along with a massive tax credit for installing solar panels on your house? Of course the solar company would have to get their own tax credit, so let's hope that Sentate energy bill gets passed eventually...

Ryan (not verified)
September 29th 2008, 4:40 pm

Great comments from Tom Lynch and Mark Mazzocchi. Also wild idea this morning from Jim Cramer who says he wants to "buy".

To follow up on that; let's look at a "bailout" preferred stock fund for individual investors @ $100/share with max FDIC-insured investment of $100K. Any dividends or equity gains to be 100% tax-free. Offer common stock to institutional investors but only through US-registered and regulated entities.

Maybe the "sacrifice" we have been talking about and need to make is for US investors to get into the US services and infrastructure market and start taking the country in a logical direction for a change. Surely Tom Friedman, Al Gore, and T. Boone Pickens are not the only guys with a vision! (But they're a good start.)

Tom Verdel

Tom Verdel (not verified)
September 29th 2008, 10:12 am

Wouldn't it be prudent to mention those who content that electic cars cause cancer owing to the emission of EMF radiation? The New York Times itself ran an article on the topic at:

http://www.nytimes.com/2008/04/27/automobiles...

Other similar comments can be found at:

http://forums.g4tv.com/thread.jspa?threadID=3...

It seems to me that since so much of Hot Flat and Crowded's message is in support of electirc cars, that this topic should at least be mentioned rather than ignored. It appears the issue is unresolved and has caused many electric car owners to return them.

verbier88s (not verified)
September 28th 2008, 9:52 pm

I can't possibly be the first to suggest this, as it seems far too obvious.
Why don't we create a volunteer organization that would operate similar to the US Military, minus the brainwashing and spirit breaking, for rebuilding our country.
Young people who want to save their own futures and those of their fellow humans could volunteer to rebuild the infrastructure- i.e. re-building the railroad, making cities more bike and pedestrian friendly, building solar and wind power plants, converting back yards into farms, repairing polluted landscapes, planting trees etc.
There could be a wealth of jobs within this org for young engineers, architects, agriculturalists, doctors, along with managerial and skilled blue collar positions.
All who join could be given healthcare packages that they would earn in their two+ years of service along with access to more reasonably priced higher education. People willing to go into the fields of highest demand could be given free education and healthcare in exchange for service upon graduation.
The youth of today are well aware of the dire situation our country and planet are in, and they're starving for ways to help. We need people who understand our current state of technology and world affairs to take the reigns in the next phase, not the same old group of old white men from the business and political sectors who refuse to retire. The potential exists in my generation to mount a campaign equal to that of our grandparents during WWII. I personally think a project of this magnitude is the only thing that could save us.
Let us earn our right to healthcare and state funded higher ed. Let us create an economy and an environment that will allow us to raise children of our own in good conscience as you older folks were able to.
I am currently too afraid for my own future to even consider bringing another life into this world.

Mark Mazzocchi (not verified)
September 28th 2008, 8:52 pm

Having been in the solar industry in the 1980s where all were squashed or bought by oil companies, and now living on Long Island with the second highest homogenized electric charges in the country because ALL the electric is generated by oil. And then however having a utility that will not allow anything below net usage zero metering for solar. i.e. I can only have a zero electric bill the captial equipment is my problem over the years, they get the suplus for free unlike europe. Let's take some of this subprime money or bailout and make it avaiable back to the USA Citizen to fund solar, wind and geo thermal and CUT the forms and red tape and tax refund bull to the bone. I will do my share, I am ready but I don't want banks and my local utility to be MAKING money on my generisity and desire to reduce my (my family) carbon footprint and make sure we are in good shape in the future when Ii am retired and can do nothing about it? I want a $2KW system and let me leverage the FULL amount directly OFF my FED taxes over let's say 5 years.

Thomas J. Lynch (not verified)
September 28th 2008, 1:14 pm

Dear Thomas

Please read the book of Tom Blees : Prescription for the Planet.

There is a source of energy which is better than free. It annihilates material that we desperately want to get rid of (nuclear waste), and produces electricity in return.

This is called the Integral Fast Reactor - a new generation of nuclear power, that is inherently safe (the reactor never melts down like in the 3-mile island). It is a GREAT solution for the problem of nuclear proliferation, as it makes Uranium enrichment technology obsolete. It uses U-238 an isotope of Uranium which is 100 times more available than U-235, the isotope used in current reactors. U-238 is otherwise known as depleted Uranium or nuclear waste.

This reactor is the result of the biggest research project funded by USA has resulted in a spectacular success, Quite unfortunately, the project was discontinued by the Clinton Administration 2 years before its completion. But before getting killed, this technology has been demonstrated for real.

Several countries around the world are in the race to close the loop in nuclear power production (That is produce no nuclear waste). USA was about to win the race, before it killed the IFR project. Now India, China and Russia are at the forefront of this race.

4th generation nuclear power is fundamentally different from the nuclear reactors we are used to see. Most of the criticism that we find against nuclear power is not valid against these reactors. These reactors have the potential to be the "silver-bullet" to solve our energy and environmental crises. At the least, these reactors will be a major component in the fight against fossil fuels. They will be complementary to solar and wind power.

Article by Steve Kirsch on the virtues of IFR.
Interview by Dr James Hansen on Charlie Rose show.
Article by Mark Lynas, prominent climate change activist.

vakibs (not verified)
September 28th 2008, 10:11 am

Housing Crisis, Energy Crisis, and Food Crisis -

For 8 yrs, I have played a front-line role in each of these areas. Commonality?

Personal Behavior vs Policy Requirements,

Sorry to say, but left to our own devises, we overspent, over shopped, gave lip service to energy problems, and let the big corporations dictate policy in their favor - not the regular guy.

We didn't self-regulate...and corporation-driven marketing efforts drove behavior. The Depression generation had it right. Real values. Not bad consumer habits.

Marti Ogram (not verified)
September 25th 2008, 11:10 pm

Maybe now that we (the nation) are owners of AIG, we can use this platform to extend healthcare to the nation!

Wouldn't that be something!

You voted 'up'.
CenterChannel.org (not verified)
September 24th 2008, 9:35 pm

Hey Tom,

I saw you on C-Span a few month ago at the National Governor’s Conference. Your message was incredible.

Nation building at home! genius. I may have to get that book.

truthproduct.com (not verified)
September 24th 2008, 3:10 pm

Here’s some nation building at home that we could undertake…This suggestion probably goes into the “far fetched” category, but people should be challenged to stretch their imaginations. We should be shooting for the stars and developing bold, exciting ideas that can create dramatic, sustainable change. Sometimes outlandish ideas don’t seem so outlandish once they have been exercised and debated. A man on the moon by the end of the 1960’s? Many thought Kennedy was nuts! So, here goes…

I don’t think there is any question that the world is hot, flat and crowded. The real question is, “what are we going to do about it?” And in particular, I mean, “what are we as Americans going to do in order succeed in a global environment of ever-increasing competition for jobs and resources?” Global trade is great, but we are still just a bunch of really big tribes whose hunting grounds overlap.

There are some great ideas out there, but do any of them have the size or momentum to be game changers? I read a post in this forum where it took eleven years to navigate policy to build a wind farm. Sorry, but that isn’t going to fly. Frankly, we don’t have eleven years to waste. We need a game changing strategy – something so big, so bold that everyone can get behind it.

I finished a novel last year entitled Masters’ Plan which is the fictional story of a hyper wealthy industrialist who sees everything that The World is Flat and Hot, Flat and Crowded are all about (and Jared Diamond’s Collapse, and Richard Florida’s Rise of the Creative Class, and a few others as well.)

Jack Masters (think of a combination of Warren Buffet, Bill Gates, and Jack Welch) realizes that there is too much political and cultural resistance to drive bold changes forward. So he takes matters into his own hands. He pulls out his Rolodex of the nation’s top influencers, puts a business plan together and raises trillions in capital to build a state of the art city in the center of the country. Masters’ strategy provides the platform to take all the great little ideas out there and roll them up into one big plan that makes sense and really works. He rallies the entire country behind the idea and takes the initiative public as a massive corporation. He builds enough public sentiment to quash political resistance, and even gets school kids to contribute their lunch money (remember the little orange UNICEF boxes?…). The undertaking becomes a great initiative that that the entire country can contribute to.

Do you think it is not feasible to build a completely new city from scratch? Look at the explosive growth in cities like Beijing and Dubai, where engineers and architects are literally redesigning the earth and oceans beneath them to suit their ambitions. The marvels they are creating make our legacy infrastructure look like artifacts from the Stone Age. It’s our legacy infrastructure (not only structural, but political and cultural as well) that holds us back. Masters bypasses the resistance by starting with a clean sheet of paper.

In the novel, I spell out the technical, economic and political factors that would need to be managed in order to make this happen. Yes, it’s a far fetched idea, but not much zanier than putting a man on the moon. I show how the massive project reduces stress on our existing, overtaxed cities and actually pays for itself in ten years due to a GDP increase with lower production costs and reduced environmental impact. A side benefit – it reinvigorates our sagging economy by creating millions of jobs of all classes and accelerating the development of new technologies. If you think of our country simply as a productive engine, this project turbocharges that engine, reduces the pollution it creates and redistributes a highly productive workforce to an area in the country where they can be more efficient. I add in a bit of conflict, suspense and drama to make it an interesting read (e.g., fierce resistance from corporate heads, politicians and international detractors.) But the real message is that something bold must be done soon, and we really could make it happen with the right leadership and the right strategy.

If anyone wants to take a look, email me at timdodge@alumni.wfu.edu. I would like to hear your comments and questions.

Tim Dodge (not verified)
September 24th 2008, 8:50 am

The current cost (installed) of nuclear based electricity generation is about 1.72 cents per kilo-watt-hour. Distribution costs are perhaps 1.5 to 2 c/kWHr. Obviously this compares quite favorably with even coal which runs about 2.6 c/kWHr. Solar and other renewable generators cost up to 12 c/kWHr.

Pebble Bed Modular Reactors (PBMRs) have been developed and proven safe even with a complete stoppage of the helium coolant. The temperature rise is about 300 degC. Westinghouse division of Mitsubishi is installing several modules in Japan. Installation time is about three years after location and permitting has been accomplished and a Module is currently sized at about 400 MW, about right for a community of 25,000 people. If requirement increase then additional modules can be installed at the site without extensive reengineering and permitting.

I believe the original development was accomplished by an Australian company which liscensed the technology to a South African company PBMR, Ltd. This helium based reactor has many benefits. The fueling is continuous, dropping a cue ball sized pellet in the top of the reactor while dropping a spent pellet out of the bottom. This means that refueling downtime is not neccessary and no reserve generating capacity is required for refueling purposes. No hydrogen embrittlement with the helium coolant and inherent self-limiting temperature rise, mean that construction parameters are much reduced; a 1/2 inch containment structure instead of 1.25.

The modular construction means that after the first module is constructed, there is a confidence in the design blueprints. The helium does not pick up radiation like H2O so that repair and maintenance schedules are significantly lengthened. The helium can also drive the generating turbines dirctly without undergoing an intervening heat exchanger with its inefficiencies.

Not Invented Here could pose some problems but then the benefits are too great to be ignored. The continuous operation enables distributed generation with its own benefits.

With regard to incentives, the distributed costs as paid by consumers would be about 1/5 current costs experienced by my electricity provider. A carbon tax would make the PBMRs a No-Brainer. These PBMRs would be a 20-50 year interim solution while completely renewable fuels are being developed.

It is important to rely on a carbon "TAX" as opposed to a Cap & Trade system. The latter is too subject to gaming and would probably end up in a big confused regulatory and litigating mess. Cap & Trade is a "Gamer's Delight".

Ah hah, you say, what about nuclear wastes? A simple solution presently exists withou utilizing the methods of separation and vitrification originally developed at Catholic Univesity of America. CUA's President wondered for what CUA could use some spare space on campus. They still get an annual grant for the vitrification. The House speaker, Tip O'Neil (?), got them an earmark for a vitrification study about 1980, with an annual grant continuing to this day. The Hanford plant in Washington is now building three production vitrification melters for the wastes up there and, I suppose, from around the nation. After vitrification the material will be shipped to Yucca Mountain in the $20 B (so far) staorage site. Senator Harry Reid's favorite topic ("Not while I'm alive").

My solution to the disposal problem, and it is a big problem, is to plasce the radio active materials, whether low level or High Level Radioactive Waste (HLRW), in concrete filled caskets and drop them into one of the severaldeep-ocean trenches. These trenches are formed where one tectonic plate subducts under another.

Yes, there may be problems of drift on the descent, but these are engineering problems solvable with todays technology. I would place an anchor at the bottom of a neutral buoyancy cable guided by a submersible or through imaging techniques developed by the oil exploration firms. These oil ccompannies might gladly share the cost of the placement rigs as they have done with Japanese scientists as reported in the journal Science.

In any event the caskets would be carried through the earth's crust by the subducting plate and into the magma from which the radio-active materials originally came. Time is of no interest as long as we know the direction. This is taking advantage of our spaceship's (the earth's) global garbage disposal system.

In conclusion:
1. We need a carbon tax not Cap & Trade.
2. We need to lease or buy the PBMR
technology.
3. Enlist Harry Reid's support.

Pete (Pickled) ... (not verified)
September 24th 2008, 12:45 am

You have it! We have met the enemy and he is us. (some apologies to Walt Kelly) Without treating the demand side of the equation (too many people), patching up the supply side with stop gaps and chewing gum merely postpones the inevitable descent as the extended resources are also depleted. If the efficiencies of conservation and applied technologies are exceeded by overwhelming demand then the efforts were misdirected.

anasasi (not verified)
September 23rd 2008, 11:15 pm

it's time that we citizens get smarter about simple finances, economics, govt.,etc. in the same vein as jh mclaughlin's comments, we need to take responsibility to educate ourselves about the basic dynamics of finance, interest, credit, global warming, energy, etc. how about this: public tv and commercial tv as well could start airing educational seminars on this now, with commentary by highly respected and popular hosts to draw national interest: oprah, bill moyers, colin powell, brian williams, bill maher, gwen ifill (sp?), t boone pickens, and you, tom friedman. topics could be:
-how money works and what you should know
-how can we save our economy?
-seven steps to help the economy
-could you pass the test to become an
american citizen? - we'll show you how!
-civics 101 - more interesting than you
might think!
-bright ideas to get our country back on
track
-a new way to look at taxes -love 'em or
hate 'em
titles could be basic or attention grabbing.
i'm thinking of a well publicized program that would be televised that would intrigue a whole cross section of the american people, perhaps like oprah's big book club. maybe communities could have people watch and discuss in bars, homes, libraries, etc. perhaps they could tie in with j leno, dave letterman, 60 minutes, oprah - each show being devoted to one topic.
-in other words, a huge, publicized educational thrust before the election.

carol l (not verified)
September 23rd 2008, 8:10 pm

As a financial services professional, I see the key issue here as financial literacy. People do not have a fundamental grasp of concepts like how loans amortize, how interest accrues, how to budget their money. I've spoken to graduate-level communications classes on strategic management and the financial markets and time and time again, when I poll the students, they do not have even the most rudimentary understanding of personal finance.

In the big picture, a lot of folks feel that more regulation of big business is the answer, and to some extent, I agree. I also think that consumers have a nickel in this quarter as well. For instance, in the context of mortgages, we can regulate predatory lenders, but on the flip side, it takes two people to seal a deal. Consumers were certainly enticed into teaser rate loans, but from my vantage point, they also didn't take the time to read what they were signing. I can attest to this with a lot of anecdotal evidence from those around me who are now upside down on their homes b/c they didn't understand how ARMs work. We can call it "pure ignorance" but that only goes so far with me; people have got to take responsibility for their decisions. I also feel that if we are going to stand by and let the government effectively bail out big business (i.e. Bear Stearns, FNMA, FHLMC, AIG) then we should ask for equal time for consumers: help them out the same way that big business is being assisted. But do so with a long-range outlook: give people the tools to avoid similar pitfalls in the future. Create jobs in financial literacy that help those who need it most. Start with those who are in the throes of bankruptcy and teach them to get out of it. Entities of this sort already exist; think of the credit counseling agencies. Consider government sponsored programs that enable these types of businesses to extend their assitance to more than "getting folks on a payment plan" or "negotiating pennies on the dollar." Teach them to handle their money! If we want to have solutions, I feel like consumer education is probably the best first step.

JH McLaughlin (not verified)
September 23rd 2008, 7:07 pm

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