White House Chronicle

News Analysis With a Sense of Humor

Danger in the Market: The Sharks Have Computers Now

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Jim McTague, Washington bureau chief of Barron's, the stock market newspaper, is as gentle a journalist as pads the halls of Congress or pops into the briefing room of the White House. But he has chosen to poke a tiger with a short stick in his new book, “Crapshoot Investing: How Tech-Savvy Traders and Clueless Regulators Turned the Stock Market into a Casino.”

The book is likely to stir regulators, legislators and traders. It tells a sad and frightening story of inept regulation, congressional good intentions gone wrong, and technological excess.

McTague says a very small number of trading firms, using highly sophisticated computer programs, have upended a once efficient market for the allocation of capital and turned it into a casino operating at electron speed. The losers, he says, are traditional brokers and small investors who

do not stand a chance in a market dominated by trading that moves faster than information can be released to the public. The much-loved New York Stock Exchange “ticker” now lags actual computer trading, McTague says.

Currently, 70 percent of all trades are executed by hugely complex algorithms written in computer code by mathematicians and physicists, who have abandoned their traditional lines of employment for the gigantic rewards of Wall Street.

In a chapter headed “The Road to Ruin,” McTague says, “The history of U.S. investors and their experiences in the equities market has all the earmarks of an abusive relationship, and it will require an eminent psychiatrist several hundred pages to explain why the battered investors return to the market time after time after their previous drubbing, knowing in their hearts that they eventually will be brutalized again.”

The great example of how dysfunctional and dangerous the markets have become is May 6, 2010. It is the day of the “flash crash,” when the so-called high-frequency trading computers lost their electronic minds

There are stories about what triggered that day of disaster; but, in the end, the thing is that it did happen. Computer trading ran away with the market and nearly sank it. In a 10-minute period, many classy blue-chip stocks were nearly wiped out. For example, Accenture, trading at around $42 was reduced to a penny.

When trading was suspended that day, the crafty computers simply moved the trades to other exchanges, such as Frankfurt and London. Eventually most of the lost value was restored, but not the lost confidence.

The computers had outsmarted themselves. Their programs rely not only current trading conditions and knowledge of specific stocks, but also on historical data. “The computers read the newspapers and they have information from historical reporting as well as today's business pages,” McTague says. The problem is they do not have any newspapers from the 1920s; and when the crisis of May 6, 2010 hit, “the computers did not know what to do, so they began liquidating.”

This sad tale begins in the 1970s when Congress, with good intentions, sought to make all stock markets more competitive and the New York Stock Exchange in particular a more open and consumer-accessible place.

In 1975, the reforms were enacted as amendments to the basic securities law of the country. Over the years, the regulatory agencies implemented these reforms. According to McTague, they botched the job.

The reformers also misjudged the impact of computers. Their idea was that they were going to make the markets more egalitarian. Instead, they have favored the greedy few at the expense of the small investor, broker and 401K pensioner.

McTague has no magic solutions, nor does he suggest that people with excess cash stuff it in their mattresses. But he has some tips which he follows himself, including:

  • Do not trade early in the day because that is when most small investors put in their orders, and the sharks are waiting to eat them in the afternoon.

  • Do not leave your research to other people.

  • Be brave and hold on, if you are confident in the stock you have invested in. But do not hesitate to sell it if necessary.

In the short term, computers are making nonsense of the old advice to buy and hold, so investors have to watch their stocks carefully and do their own homework.

Broker-turned-journalist McTague is still trading himself, aware of the dangers. He concludes, “… there is no sure-fire method for a retail investor to beat the market. It has become a shark tank and we are the anchovies. Every time you buy or sell a stock, you are rolling the dice and hoping for a good outcome.” — For the Hearst-New York Times Syndicate

Chronic Fatigue Syndrome: Lives Interrupted

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In 2010, I made more friends than in all of my life. They are scattered across the United States and around the world. But for their sake, I wish they had never heard of me.

Sadly, my new friends know me only because I have taken up their cause. I have written and broadcast about their plight, and they have responded by pouring out their hearts to me.

For very minor service, I have received more gratitude, more praise and more life stories than from anything I have written or broadcast in five decades in journalism.

My sad, suffering new friends are victims of a grossly misnamed disease: chronic fatigue syndrome (CFS). It was once known more robustly as myalgic encephalomyelitis (ME), which at least suggests seriousness even if it isn't quite accurate. Myalgic describes pain in the joints and encephalomyelitis, inflammation in the brain and spinal cord. CFS has no known cure, and varies in intensity during the sufferer's lifetime.

In 1988, the Centers for Disease Control named the disease chronic fatigue syndrome after an outbreak in 1985 at the Incline Village resort on Lake Tahoe, Nev.

As far back as the 18th century there were recorded outbreaks of the disease, which was given various given names. In 1955, there was a major outbreak at the Royal Free Hospital in London.

The 300-case cluster in Nevada is generally recognized to be the largest in the United States. The second-largest cluster occurred in Lyndonville, NY, a northwestern hamlet where 216 cases were confirmed in a population of fewer than 1,000, also in l985.

A Lyndonville physician, David Bell, is regarded as one of the true experts on CFS, as well as one of the most dispassionate in the controversies that swirl around the disease. Bell has resisted pressure from both the medical establishment and patients' groups while retaining their respect.

As I see it, there are four controversies that plague discussion, research and therapies:

  • Is it a psychological disease with severe physical manifestations (a diagnosis favored by the British medical establishment)?

  • Is it caused by the new retrovirus XMRV (first spotted in prostate cancers) as some researchers believe, and nearly all the 1 million patients in the United States pray will lead to a cure?

  • Some charge there is a conspiracy in the medical establishment to downplay CFS out of guilt over past indifference, or pressure from the psychiatric practitioners who are reluctant to surrender jurisdiction.

  • Others fear a threat to the general population — clusters confirm CFS is contagious. But the pathway of the pathogen (air, blood, sexual intercourse, surfaces, food) or how great the risk is unknown.

Thanks to the Harvey Whittemore family — daughter Andrea Whittemore Goad has been a CFS sufferer since childhood — some serious, privately-funded research is being done at the Whittemore Peterson Institute (WPI) in Reno, Nev.

It is from this institute that the most compelling evidence of a retroviral role in CFS has originated. But recently, it has been refuted by British scientists who claim there was contamination in the tests, skewing the results.

Dr. Judith Mikovits of WPI rejects the British conclusions of contamination. She is very confident that she has found XMRV present in a majority of CFS patients, contending that she has used four methods of analysis against one in Britain.

Bell, the hands-on doctor from New York, told me he believes the virus is present. Yet only when XMRV is irrefutably proven to be to blame can the search for a cure take shape.

These are among issues that will be discussed on April 6-7 at a “state of the science” meeting at the National Institutes of Health in Bethesda, Md. But there is no expectation that anything very new will be revealed as the debate rages daily on the Internet.

Deborah Waroff, a gifted New York City author, former securities analyst and CFS sufferer for 22 years, tells the story of her first attack this way: “I have no idea how I got it. I had the symptoms of flu. After a week, thinking I was pretty well, I went back to my normal activities like biking and tennis. Then after a week, I was sick again. This repeated several times that summer [1989], until I got to a point where I was never well again. After a little activity, I would collapse, fold up.” Often, Waroff is bedridden, and nothing has improved permanently.

Her symptoms were classic; fever, dizziness, stomach upset, swollen lymph glands and frequent headaches. She developed cognitive problems such as putting the wrong words in sentences, known as dysphasia.

Waroff introduced me to my new friends and their terrible witness to suffering, abandonment and medical indifference. Their families break up, their spouses and lovers drift off. Infected parents worry for their children. One correspondent told me that they are the “unburied dead.” Others said they were “living in coffins.”

They have no celebrity spokesperson. They have no Washington lobby fighting for research dollars. They have no hope that a cure is just around the corner; and little confidence that government research organizations are trying hard enough, if at all, to find one. To know them is to peer into hell. — For the Hearst-New York Times Syndicate



Obama’s Empty Gasoline Tank

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There is a piece of doggerel which goes:

They said it couldn’t be done.

So I went right to it — that thing they said

Couldn’t be done.

And I couldn’t do it.

And that is the way it has been with presidents since the 1973 oil crisis. All of them – from Richard Nixon to Barack Obama, who has just joined the club — have wrung their hands and exhorted us to use less oil in general and less foreign oil in particular.

Nixon had his commerce secretary, Peter G. Peterson (he of enormous wealth these days), promise far reaching and revolutionary “initiatives” to tame our thirst for oil. But Nixon was out of office before these palliatives were revealed.

Gerald Ford, caught up in vicious inflation, partly linked to the cost of oil, launched the Energy Research and Development Administration (ERDA), combining the Atomic Energy Commission, the Office of Coal Research and other energy entities in the federal government. ERDA initiated many programs, while politicians invoked the Manhattan Project and the Apollo 11 moon landing. But the search for the Fountain of Eternal Energy failed.

Jimmy Carter wanted not only to solve the energy challenge, but to be seen to be solving it. Ergo, he expanded ERDA into the Department of Energy (DOE) and created a separate Synthetic Fuels Corporation. The latter failed after a short and unhappy life. No oil reached the pumps.

When the price of oil collapsed in the 1980s, so did hopes for many of the alternative energy sources, including ocean thermal gradients and flywheel energy storage.

To its credit, though at great cost, DOE, through its chain of national laboratories, kept searching. The result has been evolutionary improvements in many fields, and some really revolutionary ones in how we find oil and drill for it; these include seismic mapping, new drill bits and horizontal drilling.

These evolutionary developments brought more oil to market and have contributed to the recent improvement in domestic production that Obama likes to point out. It has enabled us to cut our imports slightly, so they now stand at 11 million barrels per day out of consumption of 20 million barrels per day.

Obama wants us to cut those imports by a third. To do this, he has no magic bullet.

In fact, he has no ammunition: solid numbers and research. His speech at Georgetown University was founded more on hearsay than science or economics.

Because he criticized them for taking out leases they have not drilled, the oil industry disliked the oil component of the speech, but thrilled at the emphasis on natural gas. When it comes to leases, the industry hankers not for those it holds, but for the plums that have not been leased for political reasons:  the eastern Gulf of Mexico and Alaska.

Sadly, Obama seemed to have learned the wrong lesson on his recent trip to Brazil because he is brimming with enthusiasm for ethanol. In Brazil, this is made from sugar cane, of which the Brazilians have a lot and cheap labor to farm it. Here, it is made from corn with devastating results on all the food products that come from corn. George W. Bush shoved the country down that slippery slope, and Obama wants to add more lubricant.

Another Obama tool is mandated fuel-economy standards. Problem is the market will start circumventing the regulations. It works like this: If you mandate 40-miles-per-gallon fleet average instead of floods of new small hybrids of the Toyota Prius type, the market will supply small, regular cars and large, luxury hybrids. Better, but not everything the president might want.

Real oil savings come with high prices dictated either by taxes or shortage. Presidents, however, have to placate voters by holding down the price of oil, signaling that it is all right to consume. That leaves presidents — and Obama has just proved it — with that last resort of the impotent in office: exhortation. — For the Hearst-New York Times Syndicate


 

Taylor and Burton: In Love for All of Us

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I don't believe I've ever seen two people so in love as Elizabeth Taylor and Richard Burton. I was a young reporter in London when the lovers were staying at the luxurious Dorchester Hotel on Park Lane.

My assignment from one of those notorious British tabloids, where more good journalism than bad actually takes place, was to go up to the hotel and track them down; maybe get an interview; certainly tell the world everything that you could about their accommodations, what they were eating, and when they came and left.

The hotel, as you might expect, skillfully frustrated my efforts and those of my competitors. They guided us to the bar and an endless supply of Champagne — Veuve Clicquot, as I recall.

Meanwhile, the lovers came and went by side doors and back entrances. Day after day, I went to the Dorchester; and day after day, my prey avoided me.

All I really needed was to see them and extract a few words. Even if they'd said, “Go away and stop following us,” it would've been enough.

I can see the piece I would've written even now, “The world's most famous lovers pleaded yesterday for privacy as they sallied forth from their love nest at the posh Dorchester Hotel. … ” One would've noted their clothes; the car they got into; possibly the doorman, for a consideration, would've told me where they were headed.

But alas, no: It was not to be. And then, a miracle.

I was living in the south London suburb of Dulwich, famous for its college, its art gallery and as the birthplace of the novelist Raymond Chandler. A block or two from where my wife and I lived was a pretty decent pub with a good dining room. We often went there for lunch on Sunday. After a dispiriting week of failing to even see the Taylor-Burton duo, I was looking forward to forgetting them over a good lunch and bottle of wine.

I can't remember if we were shown to a table or if we took the table because it was the only remaining one, but we sat down without looking around. And when we did, there they were: Elizabeth Taylor and Richard Burton at the next table, only feet away.

They were so beautiful. Never do I recall seeing any couple so in love. They glowed. They stared at each other. They talked softly to each other. They smiled and they laughed, oblivious to the room and the two journalists sitting next to them.

My wife, a fine journalist herself, whispered: “Are you going to speak to them or call the office [for a photographer]?”

The mere place where they were lunching — a bit off the beaten track, as it was — would've made an item in the paper; a chat would've produced a career-building, mini-scoop. But there was something about the joy emanating from the next table that stayed my hand and my wife's. We let our opportunity slide away because of the palpable joy coming from the Burton table.

The chase could resume the next day. Maybe we had a second bottle.

Over years, I've always wondered what it was about Taylor, great actress, great beauty, great lover, great humanitarian, that caused her to be more admired by women than men, the way Marilyn Monroe or Ava Gardner were. Conversely it is men who really revered Burton, identified with him.

Maybe that made their love affair our love affair. I, for one, think it was.

Taylor, who has died at age 79, shone even brighter in the firmament than Burton. But together they lit up the world. — For the Hearst-New York Times Syndicate

 

 

Nuclear Still the Best Power for a Great Future

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For 40 years I've written about nuclear power, defended it and believed, as I still do, that it offers the best signpost to a great future, to what Churchill called the 'sunlit uplands' — in short, to utopia.

I regard electricity as one of mankind's great achievements, saving people from the menial, painful drudgery that marks daily existence without it. Growing up in Africa, I'd see men and women walking miles, many miles, barefoot across the savanna, looking for a few pieces of wood to burn for cooking and hot water.

Electricity, I've believed for these four decades, is assured for thousands of years through nuclear. With advanced breeder reactors and with the energy stored in weapons plutonium, it comes close to perpetual motion: So much energy from so little fuel.

The alternative is to burn up the Earth, fossil fuel by fossil fuel, until we are searching, like the people of the African savanna, for something that is left to burn.

Wind and solar are defined by their geography and limited by their scattered nature. Their place at the table is assured but not dominant. Industrial societies need large, centralized energy sources.

Yet a nuclear tragedy of almost immeasurable proportions is unfolding in Japan. The sum of all the fears about nuclear is being realized. Hades and Poseidon have joined to cut nuclear down.

Do disasters, like the Japanese nuclear one, really kill technologies? Mostly, obsolescence does that, but their demise can be accelerated by a last huge mishap.

While the Hindenburg disaster at Lakehurst, N.J., in 1937 didn't end lighter-than-air aircraft for passenger travel, it drew the curtains: Fixed-wing airplanes were doing a better job. The Concorde supersonic jet didn't leave the skies because of a fatal accident at Paris-Charles De Gaulle Airport in 2000, but it did make the Concorde's planned retirement immediate.

Conversely, Titanic's sinking in 1912 didn't put an end to ocean liners: They got safer. Throughout the 19th century boilers were constantly blowing up, not the least on the stern-wheelers plying the Mississippi. Boats kept working and the technology — primarily safety valves — got better. Bad technologies are replaced by safer ones and good ones with flaws were improved upon.

That is the history of boats, cars, planes and, yes, resoundingly yes, of nuclear power.

After the Three Mile Island disaster in 1979, a new word, "passive," began to dominate reactor design and construction, but maybe too late for the General Electric Mark 1 boiling water reactors ordered so long ago. Passive, as it sounds, is a design in which cooling pumps are not as important. The idea is to depend more on gravity feeds and convective cooling. These are featured in newer designs, and there has been some back-fitting. Things were moving in the right direction, but not fast enough.

The story of the reactors at the Fukushima Daiichi site is a story of success and failure. They were designed 40 years ago to meet what in advanced design is known as a "maximum" credible accident. That was, in that location, an earthquake of a magnitude which had never occurred there. Excluded from this calculation of credible — i.e. it could happen — was the tsunami.

That exceeded the imagination of catastrophe to that point in time. Within the credible design envelope, the plants performed flawlessly, just as they were supposed to: The plants shut down; the emergency cooling pumps started up in fractions of a second; and when they failed, batteries took over. The problem was the tsunami destroyed the diesel generators, and the whole sequence of disaster began.

The opponents of nuclear power — and they have been pathological in opposition for more than 40 years — have their footwear on and are ready to dance on the grave of nuclear. They might want to unlace and take a seat: Nuclear power does not have an alternative.

Big demand for new energy (ideally carbon-free energy) around the globe, and especially in India and China, can't be satisfied without nuclear. Abundance of natural gas in the United States already has reduced the demand for new nuclear reactors to four or five plants. We'll be OK for a while. –– For the Hearst-New York Times Syndicate

 

When the Environmental Remedy Is the Problem

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In the Dr. Dolittle children’s books, written by Hugh Lofting, there appears a strange creature called the pushmi-pullyu. It is a gazelle-unicorn cross with two heads (one of each) at opposite ends of its body. Push-pull is its problem.

One might have thought that the lovable creature, featured in two movie versions of the classic series, might have been interred with it inventor. Alas, no. It has been seen around the White House, haunting many of President Obama’s policies — stimulate and cut; withdraw and fight on (Afghanistan); propose and abandon (Guantanamo); and not least the mixed signals he sends on energy, especially nuclear energy.

Obama often endorses nuclear power, but he has frustrated its development in the United States, and wasted $10 billion, by reversing longstanding U.S. policy at Yucca Mountain in Nevada. After exhaustive scientific analysis, and some of the best civil engineering on earth, he came out against Yucca in his presidential campaign. The nuclear waste repository is being abandoned without an alternative site. Not having one makes nuclear a harder sell to the public.

Now there is fear throughout the electric industry that the energy-loving administration is about to deal a body blow to the energy generators.

The Environmental Protection Agency (EPA) is about to issue a rule that would force more than 400 hundred electric-generating plants, along with other industrial entities, which use river, bay or ocean water for cooling, to abandon decades-old practices and build expensive, unsightly cooling towers. The nuclear operators, in particular, feel vulnerable because environmentalists often attack nuclear power in roundabout ways.

The legal challenge to using river and bay water goes back to the Clean Water Act of 1972, as amended, which, in the event of industrial use of water for cooling demands the use of “best available technology” to reduce the impact marine life, especially fish.

EPA is on the threshold, somewhat delayed, of publishing new regulations which it is believed will force nuclear power plants using once-through cooling to abandon it and install cooling towers. Pressure on the agency to revisit the seemingly settled, once-through practice in plants has come as a result of pressure from the Waterkeeper Alliance, Riverkeeper and other water-use advocacy groups.

According to the Nuclear Energy Institute, a lobbying group for nuclear power, it would cost $95 billion to build all the requested cooling towers.

Nuclear groups feel they are most vulnerable because of the longstanding opposition to nuclear power by many environmental groups. If the economics of the times preclude backfitting many cooling towers, the threat that new plants will be forced backward is very real.

But some observers believe that the defenders of waterways may be hoisted this time on their own petard.

Cooling towers are those giant structures of the kind shown around the world at the time of the Three Mile Island accident. They are also employed by other power plants, mostly coal-burners. And they are very old technology.

Over the decades, the engineering of water intakes has evolved from a simple, large pipe with a screen on it to complex layers of baffles and other devices to keep fish in the main stream of a river and away from away from the intakes. Other devices involve lights, music, and a conveyor which returns the fish to their habitat in buckets on a wheel. Another solution is to sink wells under the surface of the water, pumping only water which has been screened naturally by the bottom of the waterway and is free of fish and most microbial life.

In short “best available technology” may now be at the intake, not in the towers which embody technology dating from the 1920s.

Also, towers present an environmental problem. In their vapor clouds they distribute all the impurities that might be in the water, including heavy concentrations of salt. At the Indian Point nuclear plant on the Hudson River in New York, the plumes the proposed cooling towers will contain some sea salt and river impurities, the operators claim. Worse the operators claim, the visual impact on the beautiful Hudson Valley will be unacceptable.

There is an irony here: For a long time, the cry “not in my backyard” belonged to the environmentalists. Now it can be heard from local communities, like Buchanan, near the Indian Point nuclear plant.

The worm may be turning; but nonetheless, the utilities fear EPA and the years of litigation and expense which is at hand. – For the Hearst-New York Times Syndicate

 

A Wake-Up Call for Public Broadcasting

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The U.S. House of Representatives, in an act of retribution that is vicious, punitive and crass, voted to eliminate the modest funding provided to public broadcasting through the Corporation for Public Broadcasting (CPB).

The $430 million in federal funding for public broadcasting is somewhat less than the $500 million purportedly spent by the Pentagon on military bands. Like Henry VIII's dissolution of the monasteries, the House has ruled that everything must go.

The cut would be another thread pulled out of the tapestry of our national culture. Without public broadcasting, MSNBC and Fox will set the tone for a generation or more; Twitter will set our thought processes. Already dispassionate news is in retreat.

Fortunately, Republican leaders rewrote the House bill because they knew it would never sail in the Senate, where Democrats hold a majority. The cleansed version didn’t whack CPB funding but instead met the goals of deficit hawks by cutting other spending.

Let me state that I produce and host “White House Chronicle,” a Washington talk show that airs on a number of Public Broadcasting Service (PBS) stations. I offer my television show free of charge to all stations. I pay for the program's closed-captioning, and pay PBS to put it on its satellite.

The action of the House will, if anything, benefit independent producers such as myself, Dennis Wholey and Rick Steves. Our product, for which we find the funding, possibly could be more acceptable to the stations than expensive programming like “Frontline,” “Nova” and the Ken Burns' series.

But I must say that PBS programming, already burdened with reruns and resuscitated British comedies, will be the worse for it. Its promise, never fulfilled, will be dashed.

CPB is the creation of Congress for helping fund the Public Broadcasting Service and National Public Radio. NPR, a ratings behemoth, will survive better. It has a loyal following and has proven that there is a market for down-the-middle news programming.

PBS, unlike NPR, has no central programming function, but instead is a loose confederation of television stations that have different owners. Yet PBS does control the “voice” of PBS television. It does this through programs it supports and sends to the stations on what is called the “hard feed.” You know these as the aforementioned “Frontline” and “Nova,” but they also include “The NewsHour,” “Washington Week with Gwen Ifill,” “Charlie Rose,” “Consider This,” and the heirs to “Masterpiece Theater.”

These programs, unlike mine, are fed to the individual stations in a bundle for which the stations pay. They are produced by well-heeled stations like Boston's WGBH-TV, New York's WNET-TV and Washington's WETA-TV.

Some of these PBS programs have been around a long time — and they show it. Television is a cruel medium and it demands innovation, experimentation and retirement. In commercial television, life is short and death is brutal. Even the Sunday-morning programs go through dramatic iterations. Less so PBS programs.

But the more egregious failure of public broadcasting is there isn’t enough fun in it: There are no high-jinks. If “The Daily Show with Jon Stewart” had been offered free of charge to PBS, it probably wouldn't have made it to the coveted world of the hard feed, where tedium and quality are dreadfully mixed in the manager’s minds. I'd like to think my program's originating station, WHUT, and WETA, which carries my program on Sunday mornings, would've picked up something so revolutionary. But PBS itself? No.

In the 1950s, the most staid broadcast entity on earth was the BBC. I worked there as a news film scriptwriter. We could show pictures of blood, but not tell people what it was. Hard to believe, huh? But elsewhere in the corporation, things were moving: Brilliant young people were pouring out of Oxford and Cambridge and setting the Thames on fire with programs like “That Was the Week That Was” with David Frost and “Not Only … But Also” with the comedy team of Dudley Moore and Peter Cook. It was explosive, dramatic, exciting, uninhibited television. The best place to be in the evening was in front of your television set.

Maybe the brush with Congress will be good for the managers of PBS, and they'll lift up their skirts a bit, as the BBC ­– that old matron — did in the 1960s.

Public broadcasting can save itself, but not with “The Lawrence Welk Show” or that tired, old British show, “Are You Being Served?” – For the Hearst-New York Times Syndicate

 

The Government Pulls Better than It Pushes

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Anyone who knows anything about railroads knows pulling is better than pushing. If you want to change the world, pull, don't push. This is especially true in the introduction of new technology.

Sadly, we are politically better at pushing than pulling. Congress, in particular, feels it is well-equipped to push and poorly equipped to pull. Its favored tool for pushing is the tax incentive. This is a subsidy in disguise, designed to propel a technology into the market.

It is the driving dynamic behind today's world of ethanol, solar, wind and the much-anticipated, smart electric grid. Pushing is good, if you understand that it is also inefficient. It hears the market imperfectly and, as a result, begs for unending government indulgence.

If the government is to have a role in the market of inventions, and in today's world it is obliged to, make it the customer not the inventor, hatchery manager or midwife. Let it pull and reward the winner not the wannabes.

A random sampling of technology that the government pulled into the market place:

·         The supercomputer. In 1955 Edward Teller, father of the hydrogen bomb, railed in now declassified documents about the inadequacy of “computing machines.” To achieve this goal, the national weapons labs bought computers, the bigger the better, sight unseen.

·         The Internet. This was invented to safeguard communications, not because it was a good idea that might find a market. Classic pull over push.

·         The aeroderivative turbine. This machine has revolutionized the burning of natural gas by electric utilities; but its genesis–its pull–came from the need for higher temperatures in fighter jet engines.

The pattern, of course, is clear. When the military is the customer, the puller, all the parts of the chain of invention come into play: private industry, academia and suppliers of components.

A new opportunity is at hand for the government to pull a technology into the market and strengthen the national defense, in military and civilian dimensions. The product is the small modular reactor. There is wide agreement that it is a good idea, but it looks set to be taken over by the push people, with all the known waste and inefficiency. Already, the designs are circulating along with calculations of how much government push is needed. Heaven forbid.

On the shelf there already exist many small reactor designs, some military and some civilian. In 1959 the government built a nuclear-powered, civilian ship called the NS Savannah. It used a safe, small reactor that has been decommissioned long since, but which is a starting point.

Another reactor was designed and built for a West German, nuclear-powered, trade and research ship called the Otto Hahn. The contractor was the American nuclear company Babcock & Wilcox.

Babcock has emerged and is a contender for the small reactor. Problem is that civilian nuclear culture is now mired in push, i.e. money from the government. Money for investigating, not delivering.

Yet there is a military need here and now that becomes more urgent all the time. The military needs a reactor that can provide power on forward bases: Diesel is expensive and depends on long, vulnerable supply lines.

We know how to make small nuclear reactors already, both civilian and military. Why don't we do it?

The USS Enterprise–one of the greatest examples of naval engineering ever–has eight small reactors on board. Other ships and submarines of the nuclear Navy have two reactors each.

We should shelve the idea of loan guarantees and build a small reactor, initially for new military use on bases, forward and otherwise.

For 40 years I've been asking why haven't we learned more from the Navy about small reactors? They work so well.

When James R. Schlesinger was chairman of the Atomic Energy Commission, he said it was an excellent question. So I took it to the legendary Adm. Hyman G. Rickover, whose attitude was that the Navy had disclosed enough in handing over the light water technology in the Shippingport reactor in Pennsylvania.

The truth is the Navy is reluctant to get embroiled in what it sees as the civilian nuclear swamp, where their derivative reactors would be examined in licensing proceedings and subjected to scrutiny by anti-nuclear groups like the Union of Concerned Scientists. – For the Hearst-New York Times Syndicate

 

 

 

Champion Bitch Tells All; Doggone Good Story

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I was lucky enough to snag the first, and I believe only, print interview with Foxcliffe Hickory Wind, the Scottish deerhound who won “best in show” from the Westminster Kennel Club. The great lady — and 5-year-old Hickory is awesome — had just opened the New York Stock Exchange, appeared on all the morning television shows, and was being pursued by a posse of paparazzi. But that is to be expected when you are a star in New York.

Me: What do you like about New York?

Hickory: Pastrami sandwiches.

Me: What do you dislike about New York?

Hickory: There’s nowhere to run. Do you know that in rough country we can outrun a greyhound, anorexic creatures that they are?

Me: How far back does your family go?

Hickory: In Scotland, into prehistoric times. We brought down the red deer that fed the Picts and the clans before bows and arrows. That’s breeding, man.

Me: You don’t grant many interviews to newspapers, but you’ve gone from television studio to studio. Why is that?

Hickory: I like to control the message. You guys get it wrong.

Me: When you went up the Empire State Building and looked down, what impressed you?

Hickory: There’s nowhere to go to the bathroom without people watching. My heart went out to those poor creatures on leashes going up and down Park Avenue looking for, you know, the spot. Dreadful.

Me: What did you think of Central Park?

Hickory: Nothing to chase there except bicycles. No deer, no rabbits, not even one of those miniature degenerates you see in the expensive hotels. Anyway, three bounds and you’ve outrun them.

Me: You’re clearly very proud of your Scottish heritage, have you ever been to Scotland?

Hickory: No. I live in the Virginia Hunt Country and it’s the next best thing: loads of deer, squirrels, rabbits and low-slung, rodent-type things, like possums and woodchucks. Don’t run. Always going into holes. Not at all sporting.

I eschew foxes. I can tell you, I’m even apprehensive about Fox News. The stupid cousins, foxhounds, chase them and kill them sometimes. But really, I like my meals served in my bowl at home. No need to kill things in the Age of Alpo.

Me: You don’t live far from Washington and President Obama has a dog, a Portuguese water dog, named Bo. Would he interest you romantically?

Hickory: Wash your mouth out with soap. I wouldn’t run around a barn with a Portuguese water dog. And that name! It’s not much better than being called Spot. I have many names because I’m an aristocrat and I live in Virginia with other aristos, canine and equine. Soon I’ll marry a dog with a name like McTavish Ben Nevis Peebles MacDonald-Smith. We’ll have beautiful puppies which will have even longer names and will be bought by billionaires for big, folding money.

Me: What is your biggest indulgence?

Hickory: When nobody’s looking, I roll in manure. Oooh, it’s good fun. But they do kick up a fuss with shouting, baths and the pointed finger. I just look at them and think: Poor things, without me they would be nothing.

Me: What’s your favorite dinner?

Hickory: Venison, of course. Have you forgotten, I’m a deerhound? Also, I love Walker’s shortbread; all butter, sugar, flour — and very Scottish. But they don’t like me to have it. I don’t know why, considering that I’ve brought such credit on them and joy into their lives. Live a little, I say!

Me: On a delicate matter, one doesn’t usually expect a beauty queen to have coarse hair, a beard and whiskers. How do you feel about, well, being so hairy?

Hickory: That’s rude and I could bite your throat out! But right now, could you scratch behind my ears?

That’s better. You don’t have one of those pastrami sandwiches with you, do you? — For the Hearst-New York Times Syndicate

Arianna Huffington, Nearly First Baroness of the Internet

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They don’t make media barons the way they used to. Therefore it was especially sad to see Arianna Huffington, who was on the way to becoming the first baroness of the new media, sell out to AOL.

In America, one had hoped that she was following in the footsteps of William Randolph Hearst (many newspapers), Joseph Pulitzer (The World), Henry Luce (Time) and Katharine Graham (The Washington Post). In Britain, those who favored the right party were often made peers: Lord Beaverbrook (Daily Express); Lord Rothermere (Daily Mirror); and Churchill’s Irish buddy, Brendan Bracken (Financial Times).

None of these masters of their universes would have sold: They owned media to make money, to scale society, to dictate to politicians, to wield power over everything that interested them, and to have fun. A.J. Liebling’s declaration that the freedom of the press belonged those who owned the presses was not only agreeable to these magnates, but they also reveled in it.

Hearst tried to make himself president and his mistress, Marion Davies, a film star. In these he failed, but he was able to make a national figure of a young preacher: Billy Graham.

Luce, who was born in China, obsessed over the communist triumph there and sought out communism worldwide. He rewarded and punished with the use of his greatest weapon: the cover story.

Graham liked to drop in on world leaders for what she felt were state visits.

Beaverbrook tried to prop up the British Empire in honor of his native Canada: and Rothermere liked to prop up a vision of England of the kind projected in “Brideshead Revisited.”

Today there is a press baron who meets the high standards of global pretensions and influence, and who thinks newspapers are for the purpose advancing his agenda alone. He is, of course, Rupert Murdoch, and he shakes the earth when he walks in Australia, Britain and the United States. He has eclipsed the others by buying into television (Fox) and treating it as a partisan newspaper.

Even so, Huffington had promise. She has the obligatory ego and a fine sense of her own correctness, which has enabled her to switch from right to left — and now, it would seem, to the middle. She craves high office, having run for governor of California and lost to Arnold Schwarzenegger. She has shown a clear propensity for collecting influential friends, which began when she was the first woman, and the first Greek, to head the Cambridge Union.

And Huffington knows how to make money. She founded the Huffington Post, which is the first Internet publication to make money and to do so without a rich consort, like Slate, founded by Microsoft and now owned by The Washington Post, or The Daily Beast, now owned by billionaire Sidney Harman who, at age 92, wants to enjoy the non-economic benefits of journalism.

Huffington started the Huffington Post as a liberal counter to the conservative Drudge Report. Soon it was a success in its own right, and vastly different from the Drudge Report in scale and impact.

Although shapeless and lacking a clear mission, the Huffington Post pointed the way to the future: a pure Internet play that was breaking into profitability and creating a business model for the future. Now she has sold it for just $315 million and an amorphous job.

One had hoped that the Huffington Post, having broken with the pack in acceptance and revenue, was going to become the first Internet news thing that was going to accumulate enough wealth to do the expensive news coverage that is still done only by newspapers: cover wars and revolutions, business and finance, homemaking and education, and the machinations of politicians and their paymasters.

Alas she has sold out to AOL, which is dabbling in localized coverage, the Patches, and many rifle-shot national titles, like Politics Daily. The way they are going will lead to scattered effort, uneven quality and a managerial nightmare.

The newsletter industry learned all about the problems of too many titles: none made enough money to stand alone, and many were impossible to discipline. (This writer published newsletters for 33 years.)

Poor Arianna. The highest-flying Greek since Icarus, they say, has fallen to earth before she could become the first Colossus of the Internet.