Hidden Costs

The discussions on two threads, “Protectionism and the Detroit Bailout” and “Do-Over,” have made me think about the hidden costs of transportation.

Of course, the hidden costs of transportation matter a great deal. For instance, the hidden costs of gasoline and natural gas allow thugs like Hugo Chavez to destroy the civil society of Venezuela, and reckless men like Vladimir Putin to invade his country’s neighbors.

Hidden costs come in terms of infrastructure investments. For, so instance, the Dwight D. Eisenhower National System of Interstate and Defense Highways is essentially a subsidy on the price of gas, because it makes gasoline for cars much more useful than it otherwise would be. Similarly, a Detroit bailout would also subsidize consumption of gasoline, by taking capital that would otherwise be invested elsewhere, and using it to build SUVs like the Cadillac Escale and the Hummer.

However, things don’t need to be this way. Instead of building infrasturcture and supporting bailouts which empower destructive men like Hugo Chavez and Vladimir Putin, we could build a better fuel infrastructure. We could turn the hidden costs to be on the side of the good guys.

Projects like…

… point the way forward. Now, there are policy choices to be made. Should for instance, we encourage electric cars which use no gasoline, or hybrids that can scale faster? Likewise, to what extent should America lead alone, and what extent should the move off fossil fuels come from global cooperation?

Future threats are not from massive coordinated nuclear strikes that made the interstate highway system necessary, or even resource wars between rising countries.

Washington has an unusual amount of power during this crisis, during this inflection point in our economic history. Let’s hope that Barack Obama proves himself to be a forward-looking President, and helps move us off of oil and natural gas.

33 thoughts on “Hidden Costs”

  1. The electric car is fine with me, but I do question its CO2 footprint.

    Hopefully Obama will bring real science back to the table, and a clearer picture of what can be done efficiently will begin to come into focus. Right now industry/environmental agendas and propaganda have muddied the water.

    His primary guide should be dealing effectively with CO2 pollution as TPM’s mommy was right.

    My boyhood playground, the South Gulch, is now a wind farm:

    http://www.wapa.gov/transmission/wessington/pdf/wessingtonMap.pdf

  2. Dan, if you have time you should consider reading “Physics for Future Presidents,” by UC Berkeley professor Richard Muller. He teaches a popular physics course for non-majors. The book extensively discusses hydrogen, solar, biofuels, wind, electric cars, etc. While some of these energy sources are more promising than others, none, with current available technology, would substantially wean us from the extensive use of fossil fuels. At present, it’s a pipe dream.

  3. We could build trains. My workplace subscribes to the proceedings from the Transportation Research Board; the first article was a study of the Shinkansen.

    It is not state funded; the only interference, at least that the article mentions, is the Japanese Government’s demand that it run to smaller communities. It is competitive with local commuter airlines. Its slowest run is as fast as the Acela trains running in the Northeast Corridor– and it gets more stops in because it (unlike Amtrak) isn’t sharing track with a freight railroad.

  4. Uggh, I’m blogging while tired again. I forgot another key difference between Japanese and American Rail conditions; Japan has an extensive network of narrow-gauge railroads to serve commuters and feed the shinkansen. That, plus the greater population densities, does limit the number of places in the US that a Japanese-style high speed rail network would work.

  5. Michael,

    My home state of South Dakota once had an active rail network, as did many states, until the collapse of the industry in the face of widespread hidden subsidies to auto makers.

    Mystery Meat,

    Thanks for the rec!

    sonofsamphm1c,

    I don’t know about CO2 footprint, and don’t care either. The purpose is to reduce the flow of capital to non-wealth-generating hydrocarbon-exporting states. Whether you call this a reverse oil shock [1,2] or something else, it reduces crazy behavior.

    [1] http://www.nytimes.com/2008/10/21/world/21petro.html?_r=1&partner=rssnyt
    [2] http://thomaspmbarnett.com/weblog/2008/11/the_second_law_of_petro_politi.html

  6. The carbon footprint is essentially the only thing that will determine what we do with energy.

    We will not for instance, build coal-powered electrical plants to operate electric cars – unless there is a significant technological breakthrough in carbon sequestration.

    To get incorrect evaluations of Venezuela, it’s tough to beat a combination of TPMB and the NYT.

  7. Samson, you’re forgetting indirect carbon sequestration–coal doesn’t have to be shipped here from some other part of the world, so the cost of shipping it can be removed from the overall footprint.

  8. sonofsamphm1c ,

    The carbon footprint is essentially the only thing that will determine what we do with energy.

    Earlier you implied that price was eseentially the only thing that mattered (when you claimed that oil was the cheapest energy source).

    Now carbon footprint is.

    What other things are essentially the only factor that matters?

    We will not for instance, build coal-powered electrical plants to operate electric cars – unless there is a significant technological breakthrough in carbon sequestration.

    Considering the dozens of coal plants currently under construction, this appears to be trivially untrue. [1]

    To get incorrect evaluations of Venezuela, it’s tough to beat a combination of TPMB and the NYT.

    What sources do you recommend? (I assume the Washington Post and The Economist are also in on the conspiracy?)

    [1] http://www.netl.doe.gov/coal/refshelf/ncp.pdf

  9. For transportation, oil is the cheapest energy source. When it comes to switching away from oil, the switch will be determined by carbon footprint. Mitigating CO2 is going to be what drives energy decisions.

    That they are currently building coal plants without sequestration is not news.

  10. sonofsamphm1c,

    It’s hard to have a conversation with you when you make wild claims and don’t bother defending them.

    These two comments:

    We will not for instance, build coal-powered electrical plants to operate electric cars – unless there is a significant technological breakthrough in carbon sequestration.

    &

    That they are currently building coal plants without sequestration is not news.

    Appear to logically contradict each other.

  11. No they don’t. Current construction of electrical power plants is either replacing outdated plants or meeting demand growth for the conventional uses of electricity. The current administration came in disputing man is causing global warming, so can there be any surprise that there is no requirement for CO2 sequestration by new coal plants?

    There are not enough power plants in existence to both meet current/future conventional electrical power needs and to replace oil as the primary transportation fuel. This not a “wild” claim, as you wildly claim. I believe we consume somewhere in the vicinity of 22 to 26 billion barrels of oil a year – much of it for transportation. That is an awesome amount of energy. You cannot simply switch to electric cars. You have to have the electrical generation capacity. That would mean extensive future construction of power generation capacity. That switch will only be made if CO2 is significantly mitigated. Both McCain and Obama were essentially on the same page on this subject, which is why the media’s weird misunderstanding of Obama’s bankruptcy statement was so funny.

    The reason somebody called all these plans a “pipe dream” is simple. Currently there is no clear winner among the coal-source carbon sequestration technologies. They are all iffy proposals – full of industry/greenie agenda and obfuscation.

    One of Obama’s first tasks will be to get science back into the game.

  12. CNN [1] and other sources [2] discuss the consequences of electric vehicles on the grid. As these should be charged during off-peak hours, the extra electricity (about 4 plasma TV equivalents / electric vehicle) should be generated and distributed during times when the system has slack anyway.

    sonofsamphm1c, you haven’t mentioned what sources exist for unbiased news from Venezuela. For instance, where can I read a defense of Chavez’ threat to send in the military to regions where his supporters lost?

    [1] http://www.cnn.com/2008/TECH/ptech/07/23/electriccars.grid.ap/index.html
    [2] http://www.hybridcars.com/news/car-electric-grid-utopia-caveats.html

  13. If you want to believe that the current power grid can replace 22 billion barrels of oil, you are welcome to it. The point remains even in that fairy tale. A tremendous new amount of coal would have to be burned in the future, and it is not going to happen unless there is CO2 mitigation.

    What Chavez said is indefensible, but it is mostly their business, not ours. What was the context? It matters. Like when Reagan joked about sending in the bombers. The Venezuelans have free and fair elections – a very consistent history of them under Chavez. As of this morning Chavez is their choice.

    Did he send in the military to regions where his supporters lost? Has he ever defied the will of the Venezuelan voters (often predicted in the American media that he would not allow his referendum on ending Presidential term limits to lose). The American media presents such a factually distorted view of Venezuela that many Americans actually hold the ignorant belief that Chavez is a dictator.

    When I want to know what is happening in Venezuela I call friends of mine who work there in the oil business. They walk the streets. They live in venezuelan houses. They talk to Venezuelans every day.

    Recently Venezuela initiated a bidding program for investments in their tar sands. Two major companies were eliminated from the bidding: ExxonMobil and ConocoPhillips. The American media has consistently claimed that foreign investors would be leery of partnerships with Venezuela because of the threat of “nationalization”. To date there has been no nationalizing of their oil industry. This bidding process is ongoing right now, so we shall see who knows what. It is a terrible time to invest anywhere, and I think Venezueal will get solid commitments.

  14. sonofsamphm1c,

    Simply repeating claims without providing evidence, while not bothering to answer questions put to you, is not useful to me.

    Either do so or stop trolling.

  15. sonofsamphm1c is engaging in an unhelpful monolog. He comments in this thread are not helpful to me, and therefore are being moderated in accordance with this blog’s policy on trolls [1].

    sonofsamphm1c is encouraged to return to dialog on this thread, to helpfully comment on any other thread, or to post his own thoughts and monologs in the most recent open thread [2]

    [1] http://www.tdaxp.com/archive/2008/06/22/trolls.html
    [2] http://www.tdaxp.com/archives/tag/open-thread

  16. The ironic thing is, your views (as far as I can tell) aren’t so incompatible. Even if you don’t buy global warming for a moment, reducing carbon emissions still makes sense as a measure of reduced fossil fuel usage–but the question then becomes “How?”. That’s where your cost criteria comes in as a means by which businesses and governments can figure out where the most good can be achieved with a given level of investment. It also reduces the likelihood that any given source of alternative energy will be relied upon too much.

  17. Even if you believe in anthropogenic global warming, the US contribution is merely a rounding error compared to China. We can reduce the production of CO2 in North America to zero and world wide CO2 production will continue to increase due to Chinese economic growth.

    I personally favor improvements in fuel efficiency and alternate energy production but that is because most of the petroleum exporting nations are dangerous and unstable places run by people who are actively hostile to the United States in particular and western civilization in general.

    Carbon emissions are going to increase. Period. If this bothers you then you need to look at carbon sequestration because China and India are not going to reduce their output to satisfy some greenie doomsday fantasy. Here’s a suggestion, finance a program to upgrade the sewer system of Lima, Peru so that instead of raw sewage flowing into the rivers, it is pumped 300 miles out to sea and sprayed on the surface of the Pacific Ocean where it will be carried by the Humboldt Current out to the middle of the Pacific, serving as nutrient for plankton as the bottom of a whole food chain of increased marine life. It would also cut down on Peru’s periodic cholera outbreaks.

  18. China and India have scientists, including climate scientists.

    You seem to think they are stupid and incapable of acting rationally. They are not stupid and are quite capable of acting rationally.

    The Lomborg two step leads to nowhere.

  19. sonofsamphm1c

    They are acting quite rationally. They have recently achieved a level of prosperity where significant numbers of their population are living at a world standard middle class existence. They don’t want to lose this and they want to extend it to a much, much, much larger fraction of their populations.

    Any Chinese or Indian politician who advocates any other course except increasing GDP and extending prosperity to more people will be out of power in jig time. Indian and Chinese scientists can look at the temperature data from Mars and other bodies in the solar system. They can look at data showing that the warmest years in the 20th century were in the 1930s. They can look at historical data from British navy sailing ships during the 18th and 19th century.

    The result is that Chinese and Indians are not going to keep millions of their fellow citizens in poverty just to satisfy the adherants of an environmental pseudo religion no matter how fervently you and all your friends believe it.

    If you want to reduce carbon dioxide in the atmosphere, you are going to have to sequester it. I have already suggested a place to start. Your only other alternative is military occupation of China and India to bend them to your will or genocide of the Chinese and Indian people. I suggest you get started on carbon sequestration if you really care about this stuff.

  20. Michael,

    Agreed — the importance of economic calculation in environmental planning is great.

    sonofsamphm1c,

    I don’t know what the “Lomborg two step” would be. Searching for that phrase in google brings up nothing. This post [1] brings up nothing, and is a strange and false attack on Lomborg for ‘ignoring non-linear feedback’ (which of course is false, as Lomborg uses the UN’s projections), etc.

    Mark in Texas,

    It’s interesting how some use the word ‘rationally’ to mean ‘what I would prefer.’ Why would China — which has to maintain economic growth of 6% or so to employ the great migration from the countryside — wish to sacrifice economic growth to please a western environmentalist? The investment can be better spent now, and many of the ‘bad’ effects of global warming (shifting arable land) is essentially a non-issue if China is wealthy enough to buy food from elsewhere, and no longer has a large ag population anyway.

    [1] http://www.coolenergyinc.com/wordpress/?p=17

  21. A few years ago western environmentalists were able to bully African nations into giving up DDT. The result has been a million deaths from malaria every year. The majority of those deaths are children.

    China and India are not as weak as African nations so they cannot be pushed around by the whims of the urban elites in Europe and North America. The ability of these formerly weak New Core nations to stand up against New Age imperialism by Old Core “enlightened” environmentalists makes them frustrated and peevish at their loss of power. This frustration is often expressed in the form of incoherent ranting on the internet.

    If economic development causes African nations to become powerful enough to once more use DDT for malaria suppression, expect the howls from the frustrated environmentalists to reach new levels of volume and vehemence.

  22. The DDT thing is ripe with exaggeration. The Marine Corps dusted Gualdalcanal (and nearby islands) with copious amounts of DDT. My father, and hundreds of others, still contracted the disease. It only takes one insect bite. The tropics are a wildly different environment than the developed world. My dad caught the deadliest type of malaria. It’s curable. He will be 90 in March. Who denied medicine to all those millions?

    China and India will be pushed around by the Chinese and the Indians, who are just as capable of environmental science and responsibility as our whatever, elite.

    You should try science.

  23. Without addressing the efficacy of DDT, it’s clear to me that sonofsamphm1c’s does not either.

    His standard of success — a100% drop in infections – is not realistic, at least not until the mosquito species is eradicated. However, we don’t need a 100% drop. We need a marginal drop to the extent that fewer super-vectors are infected.

    sonofsamphm1c’s last two paragraphs are rhetoric, and useless to this discussion.

    If sonofsamphm1c wishes to invoke science, reference to the peer-reviewed literature would be much more helpful — and intellectually honest — that the mantra of the word “science.”

  24. I invoked no such standard. The other side are the ones who seemingly assume the 100% effect. I was merely pointing out that after months of spraying the miracle pesticide, lots of people can still get malaria.

    That DDT works in controlling malaria is not questioned by me at all. The Marines eventually based an entire Division on Guadalacanal; something they never would have done had malaria been uncontrollable.

    With respect to peer-reviewed papers, I have no fear of their findings. I doubt that any find that American greenies bullied governments into stopping the use of DDT to control a deadly disease, including in the United States.

    You did not confront him for a reference on that claim.

  25. sonofsamphm1c,

    I invoked no such standard. The other side are the ones who seemingly assume the 100% effect.

    I’ve never heard such an argument, so I can’t comment.

    I was merely pointing out that after months of spraying the miracle pesticide, lots of people can still get malaria.

    Indeed. This is true until we eradicate the mosquito.

    With respect to peer-reviewed papers, I have no fear of their findings. I doubt that any find that American greenies bullied governments into stopping the use of DDT to control a deadly disease, including in the United States.

    Not sure what you are asking here — for a study on congressional self-interest?

  26. “I’ve never heard such an argument, so I can’t comment.”

    DDT often comes up in discussions of global warming. They count the gross number of people who have died since bans of DDT were instituted and blame bad science or environmentalists or both. That indicates they think DDT was a perfect remedy for the malaria problem. It’s a good remedy, but not perfect. I doubt DDT can eliminate the mosquito as the history of DDT use often mentions insect resistance to it.

    As far as I know, the use of DDT to combat disease was not banned in the United States, or most of the rest of the world. I rather doubt that peer-reviewed studies have created an alternative universe in which it was banned completely – both all agricultural and all disease control.

    My comment about science was to do with carbon, which is why he introduced DDT into the thread. With respect to carbon dioxide pollution, it would be wonderful if peer-reviewed science was paid a bit more attention.

  27. sonofsamphm1c

    As far as I know, the use of DDT to combat disease was not banned in the United States, or most of the rest of the world.

    Here is the EPA press release when DDT was banned for all purposes (including the combatting of disease) in the United States in 1972. [1]

    You did not confront him for a reference on that claim.

    Here is a meta link. Yes, this is a site with a point of view, but there are plenty of references to peer review journals. [2]

    I invoked no such standard. The other side are the ones who seemingly assume the 100% effect. I was merely pointing out that after months of spraying the miracle pesticide, lots of people can still get malaria.

    From American Council on Science and Health publication “Facts Versus Fears” – Edition 3, June 1998 [3]

    The ban on DDT was considered the first major victory for the environmentalist movement in the U.S. The effect of the ban in other nations was less salutary, however. In Ceylon (now Sri Lanka) DDT spraying had reduced malaria cases from 2.8 million in 1948 to 17 in 1963. After spraying was stopped in 1964, malaria cases began to rise again and reached 2.5 million in 1969.33 The same pattern was repeated in many other tropical— and usually impoverished—regions of the world. In Zanzibar the prevalence of malaria among the populace dropped from 70 percent in 1958 to 5 percent in 1964. By 1984 it was back up to between 50 and 60 percent. The chief malaria expert for the U.S. Agency for International Development said that malaria would have been 98 percent eradicated had DDT continued to be used.34

    Nope, not 100%. Merely 98%. Well, I guess that if it is not 100% effective then it is just not worth doing.

    Finally, I don’t expect this link [4] to be persuasive to sonofsamphm1c but I think that it will give others a good handle on where he is coming from.

    [1] http://www.epa.gov/history/topics/ddt/01.htm
    [2] http://www.junkscience.com/ddtfaq.html
    [3] http://dwb4.unl.edu/Chem/CHEM869E/CHEM869ELinks/www.altgreen.com.au/Chemicals/ddt.html
    [4] http://www.michaelcrichton.net/speech-environmentalismaseligion.html

  28. You are saying they were bullied into stopping, and that is not true. In some cases foreign countries stopped to save money. In some cases in Africa they never used DDT at all. Yet you blame all of the deaths on the banning of DDT to slander AGW science.

    And contrary to what you are saying, applications for agricultural use in the United States have been made and approved since the ban, and the spraying accomplished. Its use for disease control is also allowable. It’s doubtful that has come up, though I have read California sprayed once, with approval, to control plague.

    You invoked DDT for a reason, and it is to slander AGW science with the actions of scientists in the 1970s and 1980s. It is a common ploy, the side-step two step.

    I know exactly where you are coming from; you have no clue from where I am coming. The companies in which I am heavily invested sell petrochemicals. I like peer-reviewed science. I like to drill holes in the earth. I like selling hydrocarbons. I own 1000s of shares of the evil ExxonMobil, and tens of thousands of shares in offshore drilling companies. I think success accrues to those who get science right, and not to those who mold it for political purposes. Unfortunately, ExxonMobil has involved itself in that fruitless pursuit – a perfectly irrational thing they would never do when looking for oil.

    Crichton – peer reviewed? Junkscience – peer-reviewed?

  29. “My home state of South Dakota once had an active rail network, as did many states, until the collapse of the industry in the face of widespread hidden subsidies to auto makers.”

    What is collapsed can be rebuilt. Notice the state this system is in–not an economic powerhouse.

    http://www.nmrailrunner.com/

  30. sonofsamphm1c

    It’s only slander if it’s not true.

    I don’t think that offering the example of third world countries that were too corrupt or incompetent to spray DDT, build roads, support public education or any of the other things that honest, well run governments do really proves your point.

    The reason that I invoked DDT was not to disparage scientists from the 1970s and 1980s, although their inability to distinguish DDT from PCBs leaked from the fluorescent light ballasts does not fill me with confidence. I mention DDT to bring attention to the fact that the Chicken Littles who are are saying that we have to spend trillions of dollars to remake our energy infrastructure right now are the same people who were wrong about DDT and who’s success in curtailing the use of that cheap and effective pesticide caused the death of millions of powerless people in the third world.

    Since I was apparently not clear enough in my previous post, junkscience.com is not a peer reviewed source but it contains links to peer reviewed sources. That is why I called it a meta link.

    The link to the Michael Chichton text is also not peer reviewed but it does help explain why your emotional post in response is so similar to the reactions that I get when discussing evolution with biblical fundamentalists. See [5]

    I am curious as to where you think exactly I am coming from since you make that declaration.

    Since I like Crichton’s way of expressing himself so much, here are links to some video of him. The man will be missed.

    [1] http://www.youtube.com/watch?v=aSYla0y9Wcs
    [2] http://www.youtube.com/watch?v=noec6Xkx73k&NR=1
    [3] http://www.youtube.com/watch?v=VJJsDtSHjdE&feature=related
    [4] http://www.youtube.com/watch?v=MagSO9L2Ns0&feature=related
    [5] http://www.youtube.com/watch?v=Vv9OSxTy1aU&feature=related

  31. To take a step back, all politics is essentially the application of power to achieve desired ends, and all interventions have an effect somewhere between completely curing the problem and ending the world.

    sonofsamphm1c seems to be maintaining that DDT does not completely solve the problem, and that the ban on DDT did not involve a veiled threat to violently overthrow the government.

    Rather, DDT saves lives. Further, the use of DDT has been at levels less than what it would have been had not environmentalist groups in the United States used their influence (fundraising, GOTV, etc.) to push the Congress and the President to pass laws, rules, and regulations designed to minimize DDT use.

    This has cost lives.

    At the same time, the countries where DDT might do the most good tend to be countries swamped by other problem as well.

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