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Nuclear Industry Claims Embedded Prejudice in Finance Agency

July 19, 2019 by Llewellyn King Leave a Comment

They are bureaucracy’s equivalent of ghosts: old policies, fiats and ideas that have lost their relevance — if they ever had any — and are without a constituency, but they live on.

Take the Overseas Private Investment Corporation (OPIC), a little-known, self-sustaining agency of the government, which was set up in 1971 to help American businesses invest in emerging markets. It helps with risks that are outside the purview of the Export Import Bank and facilitates the attraction of private capital to do the heavy lifting. It is considered a success and an important tool in foreign policy, so much so that in October, it will be subsumed into a new agency, the U.S. International Development Finance Corporation, to work in conjunction with the U.S. Agency for International Development.

OIPC’s website says clearly that it helps U.S. manufacturers gain a foothold in new markets. It does not list exclusions from its consideration.

But it has priorities and blind spots, often inherited from the attitudes of a previous administration. A case in point is that it will not lend to help countries buy nuclear power or nuclear power equipment.

The nuclear industry, which is exercised about this impediment to sales in new markets, believes that the agency’s policies of opposing such assistance lie in ambivalence toward nuclear in parts of the Obama administration.

Normally, this would be of little consequence because OPIC cannot afford to finance a whole new nuclear power plant of the traditional type, running to billions of dollars. Its lending limits are in the hundreds of millions, but it does provide risk mitigation that enables other financing to proceed.

This is especially important because the nuclear power industry is in the throes of reinvention: Small modular reactors are the new reality. These have many designs and varied support, including the traveling wave reactor from TerraPower, a Bill Gates-funded company, and the first of these new small reactors, the NuScale, is soon to be deployed at the Idaho National Engineering Laboratory. It will sell power to a consortium of local public utilities.

The stakes are not small. Fifty companies are working on new nuclear designs, most of them small modular reactors that can be built in a factory and shipped to their deployment sites for assembly. All of them will feature designs that obviate the possibility of catastrophic accidents and will seek to minimize nuclear waste.

In short, the new reactors are aimed at the very markets that OPIC is interested in. Its mission, especially when it morphs into U.S. International Development Finance Corporation this fall, will be to counter aggressive Chinese marketing under its ubiquitous Belt and Road initiative, which seeks to vacuum up markets in Asia and Europe.

David Blee, the dynamic president of the U.S. Nuclear Industry Council, has met with OPIC officials. Blee, along with nuclear industry executives, has also had a meeting with President Trump, where the issue was raised. Trump turned to his top economic adviser Larry Kudlow and asked him to investigate. So far, OPIC has not softened its anti-nuclear stance.

Lawyers who deal in international nuclear trade tell me the damage from OPIC’s ban on taking on nuclear projects is twofold: First, specific projects are likely to go to foreign competition, and second is the fact that a major U.S. agency will not even entertain assisting in financing such projects suggests a lack of confidence in American nuclear products by the government itself.

Defense contractors have always found it is impossible to sell defense hardware abroad if that same equipment is not deployed by the Pentagon. The buyer psychology is not hard to fathom: If it is not good enough for the United States, we do not want to know about it.

Critics of the agency cannot say that it is wholly out of touch with today’s reality: It is helping to finance Ivanka Trump’s projects for women around the world. Maybe America’s nuclear entrepreneurs should look to pitching their magical new machines to the first daughter. After all, the nuclear industry is employing more and more women.

Filed Under: King's Commentaries

Up, Up and Away — Electricity Takes to the Skies

July 13, 2019 by Llewellyn King Leave a Comment

The aviation industry — from the backyard inventors to the giants like Boeing and Airbus — are all feverishly working on electric airplanes. The sparks are flying. The new age of flight has taken off.

Erik Lindbergh, grandson of national icon Charles Lindbergh, calculates that 200 firms of all sizes are working on electric aircraft, reminiscent of the early days of both flight and automobiles.

Lindbergh, an accomplished pilot, who replicated his ancestor’s Atlantic solo crossing in 2002, but in a single engine plane, is an avid electric aircraft proponent and developer.

Across the Atlantic in Lausanne, Switzerland, another aviation giant, Andre Borschberg, famous for his around-the-world flight in the solar-powered Solar Impulse in 2016, has just demonstrated an electric flight trainer, the H55, that is operational and being offered to flight schools around the world. It was rolled out at a press event last month.

The destination is always the same, but the paths differ.

The goal is to say farewell to noisy, polluting planes and to usher in environmentally acceptable ones. Even The Economist, a pro-business, pro-personal choice magazine with a global readership, has recently railed against the pollution from airliners and criticized the use of private jets and first-class travel. Aviation is estimated to add up to 5 percent to the greenhouse gas being pushed into the atmosphere. The real problem is that jets lay it down where it does the most damage: at 30,000 feet and above.

To those who live near airports whether it is in Arlington, Virginia, San Diego or London, noise is a real and constant problem.

It will be decades before large jet liners are replaced with electric propulsion, but for light aircraft and for a new kind of flying, involving what Lindbergh calls “flying cars,” the future begins now.

Lindbergh tells me he is working with a major automobile company on what will be a vertical takeoff and landing, flying car, aka airplane. Enthusiasts have dreamed about such a vehicle since the Wright Brothers.

Borschberg, with an enormous amount of firsthand knowledge about using electricity in propulsion, acquired in his spectacular around-the-world flight with co-pilot Bertrand Piccard, is using the experience gained with Solar Impulse in the H55. It is the first generation of trainer: good today, better tomorrow. It also gives suppliers, like Siemens — which is developing electric aviation-specific motors — to evolve their products. The H55 buys its components.

Borschberg says the flight trainer market for a two-seater simple aircraft is large and expanding, particularly in Asia. “There is a pilot shortage all over the world,” he told me.

The limitation of the H55 and other light electric airplanes, including those made in Slovenia, is range. The H55 has only 90 minutes of endurance because of the limits of battery technology. You had better have landed or you will be out of juice; up, up and away having become down, down and dismay. OK for one-hour flight training, but not for those cross-country flights that trainee pilots must make, at least in the United States.

For that reason, Lindbergh is promoting, through his company VerdeGo Aero, a hybrid with a gasoline engine and electric motors. While not a pure electric play, this will perform bridging, much as hybrids have in the car market.

Elsewhere, there is huge excitement about all-electric air taxis and many companies, including Uber, are concentrating on these. In fact, Uber ties eventual financial success to driverless air taxis.

Lindbergh says money is pouring into the electric aircraft field with rich individuals, including Larry Page, co-founder of Google, leading the way. Pure electric drones (like the air taxis, but not designed to carry passengers) are the darling of Amazon founder Jeff Bezos.

The new airplanes are of various shapes and sizes. Electricity allows you to have many propulsion points, many propellers or one; propellers at the back or the front, and even to have jet equivalent with propellers forcing air into a tunnel to create thrust.

The sky’s the limit, you might say, if batteries catch up with soaring hopes.

 

 


Photo: H55 Electric Flight Trainer © H55/ Anna Pizzolante

Filed Under: King's Commentaries

An Immigration Fix That Can Happen Now

July 5, 2019 by Llewellyn King Leave a Comment

I was once interested in buying a historic mansion in Virginia. It was a classic, but it needed a lot of work. It was being sold by a bank and, for a whole afternoon, my wife and I dreamed of owning it.

It was on the market because the previous owner, who had bought it to restore it, had gone broke. His mistake was that he had tried to do the whole job at once: the wiring, the plumbing, the plastering, the floors. Too much.

Had he done what other restorers would have done in similar situations, gone about restoration piece by piece, he would be the proprietor of a remarkable antebellum home today.

Some big jobs need to be done one thing at a time.

Immigration reform may be such a big job; so big it demands to be done in pieces, fixing what is fixable in the short term while the great issues — who, from where and how many — wait for another day and a calmer political climate.

To me, the most fixable is the plight of those who are already here: the 11 million illegal residents, predominantly from Central America.

They are here. They are people who succumbed to the basic human desire to better themselves and provide more for their families. They are illegal but they are not evil. They broke the law to find a better, safer life — the same motivation that brought people from Europe to these shores for five centuries.

Laws are made by people; human need and human aspiration are primal. We, American citizens (except those whose ancestors were transported in slavery), are the product of the same aspiration that has brought most illegal immigrants to live among us: to work hard, to raise families and to live in peace. Statistically, they are slightly more law-abiding than those who would have them gone by deportation. They are a vital new population of artisans — skilled manual workers.

The Immigrant Tax Inquiry Group (ITIG) and its tireless founder, Mark Jason, a former IRS inspector and Reagan Republican, attracted my attention six years ago because it had a ready answer for those who are illegal but otherwise blameless.

Jason wants illegal immigrants to be given a 10-year, renewable work permit with a special tax provision: There would be a 5 percent tax levied on employers and a 5 percent tax paid by the worker – what Jason calls “five plus five.” The billions of dollars raised by the program would be earmarked for the neighborhoods where the illegals are concentrated to alleviate the burdens they impose on education, health care, policing and other social services.

Notably, his Malibu, Calif.-based group’s program has no amnesty in the usual sense; no path to citizenship, not even an entitlement to lifetime abode.

Jason has poured his personal fortune into a lobbying effort on behalf of the ITIG program, including congressional briefings and information sessions.

To me, the program would solve an immediate problem: It would end the massive deportations — so fundamentally un-American — which have gone on through four administrations. It would allow families to come out from behind the curtain of fear — fear in the knowledge that tonight might be their last night of hope, of a united a family and of a livable wage. In the morning (the favored time for arrests), the state could come down on hope and love with the dreaded knock on the door; paradise lost.

The Jason work-permit program is one room in the immigration edifice that could be renovated now, and with benefit rather than cost. The deportations cost in every way: They cost in lives shattered, ICE teams, deportation centers, court hearings, talented labor lost, and finally transportation to places now alien to most of those headed there as deportees – hapless and more or less stateless. There is a fix at hand.

Filed Under: King's Commentaries

Happy Birthday, America, Still Land of Dreams

June 28, 2019 by Llewellyn King 1 Comment

Light the candles, tune the instruments, warm up the vocal cords, a very special day is upon us. It is time to celebrate a birth, a unique birth, and a birth that in many ways has lit human hope, kindled human aspiration and fired up a few revolutions.

Happy birthday, America!

I do not know any other country that has a birthday. Others have days that celebrate their independence, their casting off a colonial state or the expulsion of a tyrannical power, but no other country has a birthday. Celebrate that, too.

As I was born a Brit, I have no idea how I would have greeted the events of 1776. Would I, like Edmund Burke, the great Anglo-Irish orator and member of Parliament, have seen the emerging difference between the rugged, inventive, self-motivated farmers in the American colonies and the then subservient masses in Britain? Or would I, like Lord North, prime minister of Great Britain, and his monarch George III, have regarded the colonists as traitors?

The farmers, these landed gentlemen, were not only creating a new country destined for world leadership, but they also were forming what would come to be the universal middle class, where accomplishment would triumph birth.

Slowly in the United States, the idea grew that people who worked with their hands could belong to the middle class, aspire to having their children go to college and move up; to improve on their parents’ station in life. While this did not reach fruition until the last century, the seeds were sown in the 18th century. It was an American evolution.

When I was a boy in faraway Southern Rhodesia (now Zimbabwe), we worshipped all things American, although we were devotedly British. My father, who worked with his hands, had read that American artisans could enjoy a middle-class life. Awesome. A local publisher, Bernard Woolf, told me that the United States led the world because, for example, you could study ice cream making in college. I do not know where he got that idea, maybe from something he had read about Howard Johnson’s and its 28 flavors of ice cream.

As teenagers we fantasized about owning American products, including cars complete with fins and automatic drive. In fact, when the first automatics — which were American, of course — showed up, the dealership in Salisbury (now Harare) was mobbed by people anxious to see this marvel.

We believed in the virtues of the dwindling British Empire (we were a living, breathing example of it), but also in American know-how, and that there was no human challenge that America could not meet. That was slightly dented when the United States failed (correctly) to back Britain and France in the Suez Crisis of 1956, and again when the Soviet Union launched Sputnik the following year.

None of that really mattered. The United States remained, as Ronald Reagan was to say later, “a city on a hill” for us.

When I moved to Britain itself, I heard the first criticisms of the United States — heard for the first time that it was a harsh, cruel place. That was the socialist line that affected many Labor Party followers. But no one suggested that the United States was anything other than a land of opportunity.

I will bet that if you stood anywhere in the world and said, “I have a bunch of green cards here for the first takers,” you would be sacked like a quarterback on a bad day.

America is still the place to be if you want to cast off the bonds of limitation which abound around the world, whether they are social, economic or religious. This is the land of opportunity; opportunity to pursue all manner of dreams and to buck the conventional.

Week after week, in my work as a columnist and broadcaster, I criticize something about the United States, from the death penalty to the health care system, to economic unfairness. So much so that you might not know I dearly love the place.

Happy Fourth of July, America. Happy birthday, Land of Dreams.

Filed Under: King's Commentaries

Flamboyant, Scandal-Plagued Boris Set to Be U.K. Prime Minister

June 21, 2019 by Llewellyn King Leave a Comment

Barring the political equivalent of an act of God, Boris Johnson becomes leader of the British Conservative Party and prime minister on July 22.

Johnson is a man who fails upward. So much so that he has said, “As I have discovered myself, there are no disasters just fresh opportunities. And, indeed, fresh opportunities for fresh disasters.”

Johnson has been sacked by an editor, a publisher and by his party leader. He sins, gets caught, wriggles out and comes back emboldened.

His first recorded transgression was when he got the heave-ho from The Times of London for fabricating quotes — usually a career killer. Instead, he was hired by The Daily Telegraph and sent to Brussels to cover the European Union. He covered it by minting tales of bureaucratic excess. Later, some of Johnson’s suspect reporting entered the mythology that has powered Brexit.

One fib was that the European Commission was laying down requirements for the shape of bananas imported into Europe. Another was that there were plans for the Brussels bureaucrats to build themselves a luxurious skyscraper. He was accused of fake news long before that term was in wide use.

Johnson — as journalists like to say among themselves — wasn’t one to let the facts stand in the way of a good story. His Brussels colleagues named him as the proprietor of the “mendacious smirk.” He had a way of looking to the side and down, sniggering away the evidence when his facts were challenged.

On the upside, Johnson is articulate and adept at turning disaster into, if not triumph, something that is funny or so outrageous that the blow is diverted. When, as mayor of London, he was stranded on a zipline and left hanging above the ground, he entertained film crews with hilarious commentary. Boris meets Lucille Ball.

It’s generally accepted that Johnson was an adequate mayor of London; although, like all politicians, he accepted things already in train as his creations. He’s thought to have handled London’s hosting of the Olympic Games well. He opposed the expansion of Heathrow Airport and understood the importance of city branding, saving London’s iconic double decker buses.

For five years, Johnson was editor of The Spectator, a conservative political and literary magazine. His staff there accused him of being late, disorganized and not showing up at all, charges that have clung to him everywhere he’s worked. But he was a successful editor and presided over a rise in circulation, as well as moving the content toward his own brand of liberal conservatism.

Lazy or not, Johnson’s journalistic output over the years has been considerable and includes a workman-like biography of Churchill.

As a member of parliament, which overlapped with his editorship, Johnson never reached the heights in oratory that had been expected. He described his own parliamentary speeches as “crap.”

As an after-dinner speaker, he’s been brilliant: irreverent, self-deprecating and funny. Johnson has always played the clown — and it has played well for him.

Born on Manhattan’s Upper East Side, Johnson was educated in England and took the upper middle class route through private schools, including Eton, and on to Oxford where he studied Classics. These he loved and has since cloaked himself in his familiarity with antiquity as a way of signaling superiority and intellectual weight. An example is a longish article he wrote later comparing London to Athens and, by implication, himself to Pericles.

Fun and games also have, it might be said, pervaded Johnson’s private life. When he was married to his second wife, Johnson acknowledged a child out of wedlock. When he was editor of The Spectator, the magazine was rocked with scandal. Johnson was having an affair with the top columnist; the publisher, a woman, was involved with a member of the government; and an editor was involved with a secretary. Cupid was not a spectator at The Spectator.

The sins of the flesh would have brought down other politicians, but Johnson has moved on and up. Now he is set to marry a woman 25 years his junior.

He upended his old friend David Cameron when he threw in with the Brexiteers and became the public face of Brexit. Again, facts went out the window. Johnson saw a way to power, and he grabbed it.

Now the premiership is almost his and Britain, going through turbulent times, faces an unsteady, cartoonish hand at its helm.

Filed Under: King's Commentaries

The Miracle of Electricity, and More to Come

June 14, 2019 by Llewellyn King Leave a Comment

I constantly marvel at how wondrous electricity is, maybe because I grew up in Africa where, for stretches of my childhood, we lived under canvas in the bush without it. I can tell you it wasn’t romantic.

My father repaired machinery in rural areas. Whenever equipment like corn-grinding, diesel-powered mills failed, the family went to the location, pitched tents and managed the best we could. Food was cooked out in the open on fires, bread baked in cast iron pots sunk into the fire.

It was almost impossible to read by hurricane lantern. Listening to 78 RPM records, played on a wind-up phonograph, was tiresome. Ours broke and stayed broken. The labor of the thing wasn’t worth the scratchy sound.

Life wasn’t awful, but it was tough. Particularly on my mother, who had to get us fed and bathed with constant fires and a kerosene stove. It gave me a lifelong reverence for electricity.

When I flip on the light in the morning, turn on the coffee maker and run the shower, I’m reminded of the generous contribution of electrons to my well-being and that of so much of the world: happiness at the touch of a switch.

All of this came back to me in Philadelphia, where the savants of the industry gathered recently at the Edison Electric Institute’s annual meeting to ponder the future of the investor-owned electricity industry.

This industry, which keeps the electrons flowing, is in a state of change. And change was much in the air in Philadelphia.

It’s the change that is driving the switch from coal to natural gas and, more pronounced, the switch to renewables.

Once electricity was made in one place and delivered to the customer in another, now it’s more complicated with local “minigrids,” reflecting diverse generating sites where wind turbines, solar arrays and even gas turbines are situated.

Some consumers, like universities and hospitals, are building minigrids for security. Some localities feel it’ll be cheaper to change their relationship with the grid, and utilities themselves are building minigrids.

Christopher Crane, president and CEO of giant Exelon Corporation, said that where power once flowed one way down its wires, now it’s looking at flows that go two ways.

Lynn Good, chairman, president and CEO of Duke Energy, another giant utility famed for its engineering prowess, spoke about the challenges and opportunities of the new order, pointing out that despite the changes, which include the switch to electric vehicles — there are now 1 million in the United States — and the abandonment of coal, some old bugaboos remain. Good said building infrastructure (power lines, generating stations and substations) remains as difficult as ever.

The utilities are in a paradox: Electricity demand is flat — and most have programs to reduce demand through efficiency — yet they remain, as E&E News reporter Rod Kuckro told me, darlings on Wall Street. The switch to electric vehicles is a new market for utilities, while it augurs less well for the oil industry.

Looming full of promise for the utilities are smart cities, which will rely on electricity as their bedrock, their fuel and their glue. But these also will impose a demand: More electrification asks more reliability. Utilities are facing the need for greater resilience, fewer storm outages and reliable backup, like batteries, when lines do go down in aberrant weather.

Even here, things could change. Tech titans, like Google, which are very interested in smart cities, would also like to be electricity providers.

The existential threat to the happy future of the utility companies is cybersecurity. They are, in tandem with the Department of Energy and other federal agencies, throwing talent and money into hardening their systems. Trouble is, as Alex Santos, co-founder of the information security firm Fortress, said, “It’s a Cold War kind of situation where they build, we build.” Now the hackers build, and the utilities build against them.

When in Philadelphia, 267 years ago, Ben Franklin used a kite and a key in a thunderstorm to certify that the electricity in lightning was the same as the one known on the ground, he moved the theory of electricity along mightily. It’s still moving. Thanks, Ben.

Filed Under: King's Commentaries

On Health Care, Trump Grabs the U.K.’s Third Rail, Lets It Go Fast

June 7, 2019 by Llewellyn King Leave a Comment

American conservatives hate it. Even the most passionate British conservatives support it. It was conceived by Winston Churchill as far back as 1908, mentioned again in 1924, and laid out as a plank for British reconstruction in his forward-looking “Plan for Postwar Britain” in 1943.

This toxic issue, which turns red blue and blue red when you cross the Atlantic, is Britain’s National Health Service (NHS).

Introduced in 1948 by the Labor government of Clement Atlee, it is often thought of in the United States as a socialist idea. Churchill was, in fact, influenced greatly by William Beveridge, a liberal economist who played a key role in the formation of what came to be known as the welfare state, which combined national insurance (social security) with national health insurance.

The Brits, I can attest as a former Brit, love the NHS. They also love to criticize it. It is up there with the weather.

Also, it should be noted, the NHS is not perfect; it is and always will be a work in progress.

So large a system has its failures. Whenever there is one, conservative American friends are quick to send me the bad news — as though a surgical mess-up in Birmingham was a harbinger of the collapse of the entire system.

The NHS has been described as the third rail of British politics.

Clearly, President Trump had never heard that and had the temerity to suggest that the NHS should be part of trade negotiations between the United States and Britain. No, a thousand times no, was the instant reaction of the conservative ministers and former ministers now jostling for election as prime minister.

Any suggestion that the NHS — Britain’s most popular government program — would be in any way subject to commercial interference would doom a British candidate for public office.

How it was that Trump thought he could grab the third rail and get away with it is unknown, but he walked that one back, as they say nowadays, quickly the next day.

Over the years, I have been asked innumerable times about how the Brits do things from public transport to creative theater; from the financing of the BBC to the hobby of racing pigeons. When it comes to the NHS I am never asked; I am told. Liberals tell me it is what we need in the United States: a single-payer system. Conservatives tell me that it is communism and that the Brits get terrible health care.

I am not sure the former is desirable, and I know the latter to be poppycock fed by a fury that is based on misinformation willingly received and willingly disseminated.

I have received care as a young man under the NHS and members of my family have been recipients through the years. I have spent long hours examining various health systems and a good deal of time taking to British doctors and professionals. I have also done the unlikely in this debate: talked to patients.

A dear relative was gravely ill a few years ago. I spent a week at her bedside in a large hospital in Kingston, just outside London. As she was sedated at the time, I had a lot of time to study the place.

It was big with wings specializing in everything from heart failure to eye surgery. It seemed to work pretty well, although the public wards were crowded.

But there were these takeaways: No one was refused, nor would be sent home early, and no surprise bill would come in the mail. My relative had a private health plan on top of the NHS standard and got a private room and good food.

The biggest difference is in cost. Health care spending accounts for 17.9 percent of GDP in the United States, whereas it accounts for just 9.7 percent of GDP in the United Kingdom. Germany, France and Canada all have different systems that come out in the same place as the U.K., with service delivered for money spent.

Structural costs bring our bill up. All those women in your doctor’s office, arguing with insurance companies on the phone over “codes,” are not practicing medicine. They are engaged in a kind of health care roulette: Will they or will they not pay? Is it in the plan?

I am not sure the NHS is right for the United States, but structural overhaul is necessary. Wasted efforts and greed pervade the system.

By the way, I do not have a dog in this fight: I am on Medicare — and that costs the taxpayer too much because of weak controls.

 

 


Photo Editorial credit: Sasa Wick / Shutterstock.com. Bournemouth, UK September 01, 2018 South Western Ambulance Service NHS Foundation Trust keeps their emergency services ready at the Airshow

Filed Under: King's Commentaries

Kazakhstan, From the Silk Road to the High-Tech Highway

May 31, 2019 by Llewellyn King Leave a Comment

NUR-SULTAN, Kazakhstan — Want a world-class legal system known for its integrity? Then go to London and get one, judges and all. That’s what Kazakhstan has done.

When businesses are looking to invest abroad, the availability and dependability of legal redress is a critical consideration. Should things go wrong, companies and hedge funds want to know that they can resolve matters in court, and that their cases will be heard in an impartial and timely fashion.

Kazakhstan, the vast country that straddles the boundary between Asia and Europe, decided it would put its commercial legal system above reproach. In 2015, it imported a whole legal system from England, along with English common law, to deal with commercial issues. It also imported some English judges to sit on the bench.

Presiding over this remarkable court system is Lord Woolf, one of England’s most revered justices and, before that, one of its most eminent barristers.

Kairat Kelimbetov, governor of the Astana International Finance Centre (AIFC), described this to me as a move to establish the “rule of law.” He said it was decisive in improving the investment climate. It’s also symptomatic of a desire here to “do what it takes” to move Kazakhstan to the first row of nations — in this case, to import a legal system complete with eminent jurists.

This sets Kazakhstan, a country still growing out of its years as a Soviet republic, apart from other emerging countries that seek the indigenous over the imported. In Africa, the desire to indigenize has often cost countries heavily.

This philosophy of going out and bringing in what you prize to Kazakhstan, like so much else in the country, reflects the vision of Nursultan Nazarbayev, who upon the Soviet Union’s dissolution in 1991, was elected president of the new country of Kazakhstan, which he led until his resignation this March.

Nazarbayev built this secular, economically thrusting and technologically ambitious country with an authoritative hand, but with a view to adopting and adapting. He was helped by plentiful oil revenues — Kazakhstan produces 1.9 million barrels a day.

The Kazakh managerial class reflects a diversity of elite education from Oxford to Cambridge, Harvard to Stanford, to Moscow, Singapore and Beijing universities. President Kassym-Jomart Tokayev, the constitutional successor to Nazarbayev, has heavy ties to China, and AIFC’s Kelimbetov was educated at Moscow State University and Georgetown University. The effects of that educational spread have informed policymaking and the country’s can-do culture.

Kazakhs go to the polls on June 9, in a presidential election widely expected to endorse the policies of Nazarbayev and to elect Tokayev, a former prime minister and close political ally of Nazarbayev.

In an interview, Tokayev told me that he’d have an increased emphasis on the environment, especially the Caspian Sea, the world’s largest inland waterway, which has been detrimentally affected by oil drilling, and he’d create an environment ministry.

Although Tokayev is expected to get a huge majority at the polls, he’s facing opposition from six rivals, ranging from a communist to a woman who wants to speak for small business. In fact, gender equality is, to an observer, remarkably well-achieved in Kazakhstan, at least in the capital.

Kazakhstan is challenged by its sheer size and its location. It’s larger than Western Europe, but its population is just 18 million. It’s the world’s 9th-largest country by land mass, and it’s land-locked. It has five contiguous and, at times, contentious neighbors: China, Russia, Kyrgyzstan, Uzbekistan and Turkmenistan. Governing Kazakhstan requires diplomatic agility.

Although oil has financed the growth and the building of this architecturally creative new capital, Tokayev told me he’s going to push energy diversification. Already, the electric sector has embraced solar and wind — a great resource in the country — and is increasing its exports to neighbors.

In short, Tokayev wants future development to embrace the unique size and resources of the country. So, he hopes to make it a transportation hub, an agricultural powerhouse and a technology leader. He also wants Kazakhstan, which, he told me, already accounts for 60 percent of the Central Asian GDP, to be an international financial center.

The country’s premier institution of higher learning, Nazarbayev University, emphasizes STEM, its president, Shigeo Katsu, told me. At the university, too, there’s diverse expertise: the faculty includes 50 nationalities and instruction is in English.

Filed Under: King's Commentaries

The Digital Future — Further Monetizing Your Home

May 25, 2019 by Llewellyn King 1 Comment

SAN MARCOS, Texas — Uber isn’t finished yet — or, to be precise, the technology that enabled ride sharing, Airbnb, and bicycle and scooter sharing is on the march.

It’s a simple idea, yet fiendishly brilliant: central computer control of an archipelago of often personally owned objects. So it was that private cars were monetized, and spare rooms and vacant apartments started adding to the family income.

Next up may be your roof: It could work if you have a solar panel installed or plan to install one. Rather than, as at present, selling surplus power to the local utility, you may simply sell it to a neighbor or someone else in proximity. This is happening in Australia where electricity shortages have led to radicalization of old concepts of the generation and supply of electricity.

Uber roofs was one of many ideas about the future of electricity at the Digital 360 Summit here: a gathering of those hoping to have a role in the future of the urban and suburban space with transformative digital technologies. It all comes under the rubric of smart cities.

No one is quite sure how all this will work, but an awesome assembly of companies who gathered here on May 21 and 22  tells its own tale. They include AT&T, General Motors, Siemens, National Grid, Sempra Energy, Edison Energy, SAS, Cisco Systems and Oracle.

The event is the brainchild of Andres Carvallo, who heads the management consultants CMG, in collaboration with Texas State University, itself committed to incubating innovative technologies.

All in all, when the mighty gather, it’s reasonable to believe mighty things are afoot: American city infrastructure is in the early throes of change.

The key to it all is the electric supply and the future shape of utilities, and how they manage the changes coming at them. This even as they spend billions of dollars to upgrade their systems. Tom Kuhn, president of the Edison Electric Institute, says the infrastructure investment by the investor-owned electric utilities was nearly $1 trillion over the past decade.

Yet that doesn’t mean that the ground isn’t shifting. It is.

In the urban space, we’re seeing an extraordinary assemblage of disparate interests bent on having a piece of the action. Even activists from the Green New Deal see things going their way.

They applaud the emergence of dispersed generation and micro-grids. These are the result of carbon-free generation with wind and solar. It’s these microgrids which could make the Uber roof a possibility. Also, it’s these microgrids that the utilities must accommodate to make sure that if they generate, they pay their share of the electric grid through a standby fee. The grid is like the highway system: It’s there for us whether we drive or fly.

But green enthusiasm doesn’t end with dispersed generation. The Green New Dealers are passionate about smart buildings and making more of the old stock “smart” while having high standards for new buildings. So are the technologists, armed with sensors and data.

Another mighty upheaval is the electrification of transport. Everyone agrees it’s coming, but the issue of charging is still open: Will companies, already up and running, like ChargePoint, inherit that business? Will the utilities, as some have, move into charging or will municipalities, again as some have, get involved? Fast charging, which can fuel an electric car in 30 minutes with direct current, is expensive. Slower charging can take hours and doing it at home from the household supply can take all day or all night.

I was struck by an entrepreneurial startup in San Francisco, ChargeWheel, which offers a truck-mounted charger that will come to you if you’re stuck, or just want to avoid the hassle of finding a station and waiting.

The utilities with smart meters command a lot of vital data that will shape the digitization of the cities. But no firm can think its space in the digital future is reserved for it, including utilities.

Meanwhile, some people will want to turn their roofs into generating stations and, who knows, suburbanites might want to offer charging in their driveways.

Uberization knows no frontiers.

The scramble is joined.

Filed Under: King's Commentaries

Urban Walkability Is the New Measure of Livability

May 17, 2019 by Llewellyn King Leave a Comment

Walkability is the new hot concept in urban planning.

A new generation of urbanites and people who would like to the move from the cul de sac life in the suburbs to downtowns are seeking neighborhoods where they can walk to shops, theaters, restaurants and to see their friends.

Realtors across America are finding they can get a premium for neighborhoods where residents can walk to just about everything.

Studies show that retailers can expect much more business, sometimes as much as 80 percent more, if they have more, regular foot traffic.

Walking, to its proponents, means living lighter on the earth with less pollution, better health, a sense of close community and an air of enlightenment.

Neighborhoods like Dupont Circle in Washington and Brooklyn Heights in New York are adding walkability to the list of their virtues. But it is a phenomenon being experienced across the country and the world.

London Mayor Sadiq Khan wants to make London the most walkable city in the world, which may be news to those who already think it is a pretty good place for a stroll. But his plans go far beyond tourists marching around the sights or trying to get to Buckingham Palace from their hotel.

Khan seeks an organic change that links walking, cycling and public transport together in a unified way of getting around without cars. He has appointed a commissioner for walking and cycling, Will Norman, to oversee the new London mobility.

American cities are responding to the walkability imperative with initiatives of their own, driven by changing values and concepts.

To me, it seems like a giant back-to-the-future movement where the virtues now claimed for walkability are really the virtues of village life.

So, whether it is in San Diego or Baltimore, a new desire to abandon the car for the street is changing the way we live and what we think is the good life.

It is a part of a large urban adjustment that is underway; although the purists might want to see it as having no technological component beyond the new soles on shoes.

You cannot, as London has found, simply push walking without regard to cycling. And you cannot, as cities from coast to coast have done, put in bike lanes and permit those pesky scooters without regard to their impact on pedestrians.

More: Bikes themselves are changing dramatically. The cost of electric-assist bikes has tumbled from many thousands of dollars to around $1,000. Around Seattle, there are bike paths that call for one to be extremely athletic, as I recall.

Walkability, as an urban concept, reflects not only a new sensibility to the environment, but also a desire to regain a sense of the cosmopolitan life. Increasingly, as the malls are failing, we are deprived of the collective living experience.

The growth of the suburbs increased dependence on cars and bifurcated social life into business friends (lunch friends) and neighborhood friends (cookout friends).

Going forward, as the walkability ethic takes hold and more entrepreneurs see its potential, we will see walking communities clustered around transport centers, like subway stops; and, most likely, more short-distance commuting options, such as the light rail operating in Baltimore and San Diego.

Over the decades, I have been watching efforts to have people live where they work with planned communities like Reston, Va., near Washington. I once lived in Reston and that part of the plan never quite worked for it. People still commute to work, sometimes great distances, but with walkability as an urban goal, this trend may finally reverse.

What we do not need, in my view, is too much social engineering, which may be about to engulf London under its socialist mayor.

Bernard Shaw, the playwright, said of H.G. Wells, the author and a fellow socialist, that Wells would cut down the trees to build metal sunshades. That is the danger if walkability gets politicized and mandated. Walkability needs gentle footfalls, not imperatives.

Filed Under: King's Commentaries

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