7 ms·

The Great Recession of 2011-2020

31 points by yters 17y ago

gfodor 17y ago
I know it's an economic fallacy to say "this time it's different" but really, I think this time it is. The push for green energy has gotten enough momentum that new nuclear plants are being built and the money is flowing into silicon valley energy startups. I think this go-around the smart minds are going to be working on energy, not dot coms or wall St. One can reasonably hope that we will see more than a few energy breakthroughs in this decade. When they come all bets are off.
- Fixnum 17y ago
  From http://www.theatlantic.com/magazine/archive/2010/03/how-a-new-jobless-era-will-transform-america/7919/4/ http://www.theatlantic.com/magazine/archive/2010/03/how-a-ne... (appeared several times at news.yc): "Princeton’s 2009 graduating class found more jobs in financial services than in any other industry. According to Princeton’s career-services director, Beverly Hamilton-Chandler, campus visits and hiring by the big investment banks have been down, but that decline has been partly offset by an uptick in recruiting by hedge funds and boutique financial firms."
  - raintrees 17y ago
    Isn't there some lead time involved? Shouldn't this be tested in one to two years for a better indication of what the recent green wave will encourage?
aresant 17y ago
One of the key points in the article is how inexpensive energy is critical to both economic recovery and a high quality of life. Making a jump, if we put together a heroic "Manhattan Project"-like commitment to supporting such energy measures, it’s feasible that we could all live better with a lower GDP, is it not?
- kingkongreveng_ 17y ago
  Are you talking about fusion or something? The whole point is that nothing now known competes with fossil fuels. Oil is ridiculously cheap and versatile energy.
  - Retric 17y ago
    That's sloppy thinking. Oil is just one of many fossil fuels. You can refine it into several high energy fuels, plastics, and asphalt etc. But, plenty of things fit with with it in each of those niches. Now there is far more coal but it's used for basically one thing, electricity, and there are several things that competes with it in that area. Now if you want to replace oil, we can substitute coal and water. So, just because we are quickly running out of one fossil fuel does not mean we are running out of all fuel's or even just all fossil fuels.
    - kingkongreveng_ 17y ago
      I'm not sure I understand you. The point is no combination of any known substitutes are close to competitive with current fossil fuel usages. Coal is basically in the same situation as oil, contrary to what you may have heard. The good stuff is gone and it's getting more and more expensive already, when measured by joules of net energy per dollar. It's lower quality and harder to mine stuff.
      - Retric 17y ago
        If coal supply was really becoming limited you would see most extraction locations receiving huge profit as they reduce supply just like oil due to lack of completion. (It's a simple question of discounted future cash flows and competition.) However, the price of coal is still dominated by the cost of extraction and shipment across the board. Fossil fuels are really mindbogglingly cheap, but you still see completion such as: Ethanol fuel in Brazil, nuclear power France, and by looking at the subsidies it takes to adopt wind power you can see how close it is to coal.
johnohara 17y ago
I'm more concerned about the potential problems related to food, water and air than I am about those related to petroleum, metals and minerals. I agree that it's important to know "the true cost of things." It's the main point of the article and advice well taken. Much of the sand our present economy seems built upon is directly related to "not knowing the true cost of things" or at least "not being willing to accept the true cost of things."
- jerf 17y ago
  "I'm more concerned about the potential problems related to food, water and air than I am about those related to petroleum, metals and minerals." Those issues are not cleanly separable, if indeed they are separable at all.
dantheman 17y ago
The "true cost of energy " from the coal example is perfect example of why tax incentives & subsidies hurt us. If it takes more energy to move coal out of a mine than it generates then the mine will go out of business, that is unless the coal is used as an economical store of energy -- i.e. we use fuel to power our cars instead of nuclear because fuel is easy to move etc.
izendejas 17y ago
Why does Reagonomics get such bogus credit for fiscal responsibility? Cutting taxes while also increasing spending is not fiscally responsible. Reagan was by far one of the worst offenders, unlike what the author leads you to believe with a personal quote from Reagan. A simple google search for "reagan deficit spending" will show just how great this country did during his 8 years. That fallacy clarified, this isn't about democratic or republican, liberal or conservative. The author brushes this off, too, but devotes most of the article to implying the opposite. So the point is to evaluate the true cost of something. Wonderful! Except, I think the author doesn't go far enough. What of indirect costs and benefits of oil exploration vs. nuclear vs. coal mining, etc? The problem with not focusing on alternative energies is that you continue to feed an anti-imperialistic enemy that then forces you to spend trillions of dollars for the "sake of national security." Yes, please, find the true cost of coal mining, oil exploration, etc, and that means factoring not just immediate profit losses and tax subsidies. This means analyzing just how much, for example, it costs to fund wars in order to satisfy our oil demands (ie, how much this country has spent in wars bribing people, funding our veteran's health care, etc for the sake of national security, while we indirectly fund these very terrorist organisations). So it's okay to debt our way to fund such wars, but it's not okay to invest in the education and health of this country's biggest economic contributors--it's citizens? The problem isn't deficit spending/debt. Many successful startups or companies go through such phase where it makes sense to borrow, to dig yourself out of a hole. The problem is whether you reinvest this back into the country, its infrastructure, its education, its health, its green technologies, etc. FDR didn't get us out of the Great Depression. That's right. WWII did, deficit spending did. But then, unlike now the US was producing something other countries needed. Green technology (nuclear, solar, whatever, let them dish it out with some subsidies to offset initial costs) has to be the answer nowadays.
- kingkongreveng_ 17y ago
  > get us out of the Great Depression ... WWII did, deficit spending did. Absolutely false. Personal well being continued to fall dramatically through the war. GDP went up because the government was buying weapons, i.e. digging and filling holes. Unemployment went down because people were drafted, essentially enslaving the unemployed. The depression did not end in any meaningful sense until the war ended and government spending was reduced. Only in 1946 when you finally had the conditions that both the New Deal morons were gone and the war economy was being shut down did living standards begin to improve. > the point is to evaluate the true cost of something Only the free market can evaluate the true cost of things. A panel of human beings cannot possibly make a meaningful calculation: there is too much ambiguity and unknowable data. The things "worth the cost" win out and the things not worth the cost go bust in the market. Your points about the government subsidies to the petroleum industry are quite valid, but you seem to miss that the basic failing is government itself. If oil related businesses had to carry all security and business risk related costs themselves, that would be clearly reflected in prices and substitutes would be more competitive. The problem is that somebody in government decided geopolitical hegemony is "worth the cost."

31 points by yters 17y ago

I know it's an economic fallacy to say "this time it's different" but really, I think this time it is. The push for green energy has gotten enough momentum that new nuclear plants are being built and the money is flowing into silicon valley energy startups. I think this go-around the smart minds are going to be working on energy, not dot coms or wall St. One can reasonably hope that we will see more than a few energy breakthroughs in this decade. When they come all bets are off.

Fixnum 17y ago
From http://www.theatlantic.com/magazine/archive/2010/03/how-a-new-jobless-era-will-transform-america/7919/4/ http://www.theatlantic.com/magazine/archive/2010/03/how-a-ne... (appeared several times at news.yc): "Princeton’s 2009 graduating class found more jobs in financial services than in any other industry. According to Princeton’s career-services director, Beverly Hamilton-Chandler, campus visits and hiring by the big investment banks have been down, but that decline has been partly offset by an uptick in recruiting by hedge funds and boutique financial firms."
- raintrees 17y ago
  Isn't there some lead time involved? Shouldn't this be tested in one to two years for a better indication of what the recent green wave will encourage?

aresant 17y ago

One of the key points in the article is how inexpensive energy is critical to both economic recovery and a high quality of life. Making a jump, if we put together a heroic "Manhattan Project"-like commitment to supporting such energy measures, it’s feasible that we could all live better with a lower GDP, is it not?

kingkongreveng_ 17y ago
Are you talking about fusion or something? The whole point is that nothing now known competes with fossil fuels. Oil is ridiculously cheap and versatile energy.
- Retric 17y ago
  That's sloppy thinking. Oil is just one of many fossil fuels. You can refine it into several high energy fuels, plastics, and asphalt etc. But, plenty of things fit with with it in each of those niches. Now there is far more coal but it's used for basically one thing, electricity, and there are several things that competes with it in that area. Now if you want to replace oil, we can substitute coal and water. So, just because we are quickly running out of one fossil fuel does not mean we are running out of all fuel's or even just all fossil fuels.
  - kingkongreveng_ 17y ago
    I'm not sure I understand you. The point is no combination of any known substitutes are close to competitive with current fossil fuel usages. Coal is basically in the same situation as oil, contrary to what you may have heard. The good stuff is gone and it's getting more and more expensive already, when measured by joules of net energy per dollar. It's lower quality and harder to mine stuff.
    - Retric 17y ago
      If coal supply was really becoming limited you would see most extraction locations receiving huge profit as they reduce supply just like oil due to lack of completion. (It's a simple question of discounted future cash flows and competition.) However, the price of coal is still dominated by the cost of extraction and shipment across the board. Fossil fuels are really mindbogglingly cheap, but you still see completion such as: Ethanol fuel in Brazil, nuclear power France, and by looking at the subsidies it takes to adopt wind power you can see how close it is to coal.

johnohara 17y ago

I'm more concerned about the potential problems related to food, water and air than I am about those related to petroleum, metals and minerals. I agree that it's important to know "the true cost of things." It's the main point of the article and advice well taken. Much of the sand our present economy seems built upon is directly related to "not knowing the true cost of things" or at least "not being willing to accept the true cost of things."

jerf 17y ago
"I'm more concerned about the potential problems related to food, water and air than I am about those related to petroleum, metals and minerals." Those issues are not cleanly separable, if indeed they are separable at all.

dantheman 17y ago

The "true cost of energy " from the coal example is perfect example of why tax incentives & subsidies hurt us. If it takes more energy to move coal out of a mine than it generates then the mine will go out of business, that is unless the coal is used as an economical store of energy -- i.e. we use fuel to power our cars instead of nuclear because fuel is easy to move etc.

izendejas 17y ago

Why does Reagonomics get such bogus credit for fiscal responsibility? Cutting taxes while also increasing spending is not fiscally responsible. Reagan was by far one of the worst offenders, unlike what the author leads you to believe with a personal quote from Reagan. A simple google search for "reagan deficit spending" will show just how great this country did during his 8 years. That fallacy clarified, this isn't about democratic or republican, liberal or conservative. The author brushes this off, too, but devotes most of the article to implying the opposite. So the point is to evaluate the true cost of something. Wonderful! Except, I think the author doesn't go far enough. What of indirect costs and benefits of oil exploration vs. nuclear vs. coal mining, etc? The problem with not focusing on alternative energies is that you continue to feed an anti-imperialistic enemy that then forces you to spend trillions of dollars for the "sake of national security." Yes, please, find the true cost of coal mining, oil exploration, etc, and that means factoring not just immediate profit losses and tax subsidies. This means analyzing just how much, for example, it costs to fund wars in order to satisfy our oil demands (ie, how much this country has spent in wars bribing people, funding our veteran's health care, etc for the sake of national security, while we indirectly fund these very terrorist organisations). So it's okay to debt our way to fund such wars, but it's not okay to invest in the education and health of this country's biggest economic contributors--it's citizens? The problem isn't deficit spending/debt. Many successful startups or companies go through such phase where it makes sense to borrow, to dig yourself out of a hole. The problem is whether you reinvest this back into the country, its infrastructure, its education, its health, its green technologies, etc. FDR didn't get us out of the Great Depression. That's right. WWII did, deficit spending did. But then, unlike now the US was producing something other countries needed. Green technology (nuclear, solar, whatever, let them dish it out with some subsidies to offset initial costs) has to be the answer nowadays.

kingkongreveng_ 17y ago
> get us out of the Great Depression ... WWII did, deficit spending did. Absolutely false. Personal well being continued to fall dramatically through the war. GDP went up because the government was buying weapons, i.e. digging and filling holes. Unemployment went down because people were drafted, essentially enslaving the unemployed. The depression did not end in any meaningful sense until the war ended and government spending was reduced. Only in 1946 when you finally had the conditions that both the New Deal morons were gone and the war economy was being shut down did living standards begin to improve. > the point is to evaluate the true cost of something Only the free market can evaluate the true cost of things. A panel of human beings cannot possibly make a meaningful calculation: there is too much ambiguity and unknowable data. The things "worth the cost" win out and the things not worth the cost go bust in the market. Your points about the government subsidies to the petroleum industry are quite valid, but you seem to miss that the basic failing is government itself. If oil related businesses had to carry all security and business risk related costs themselves, that would be clearly reflected in prices and substitutes would be more competitive. The problem is that somebody in government decided geopolitical hegemony is "worth the cost."