Natural gas is not as easy a substitute as one might think. We don't have the distribution infrastructure in place. Ethanol also requires changes to the distribution infrastructure, but putting those changes in now means they will be there when things like cellulosic ethanol become feasible. Electric cars also require substantial infrastructure changes, but those could also facilitate making electricity the prime mover for any number of uses--expanded mass transit, inter-city passenger and freight rail, etc.

Brasil solved it. So can we. But Brasil didn't solve it by doing the things we have done since Jimmy Carter created the energy department. Neither will we.

(10-09-2009 06:58 PM)Hambone10 Wrote:  

(10-09-2009 11:30 AM)Machiavelli Wrote:  I wholeheartedly agree with Owl 69 here. We need short term pain for long term gain. Good luck trying to get elected that way btw! What I don't understand is how the rest of the board doesn't grasp this. Can everyone imagine for a moment what would happen to our country if we found an alternative for our population to go from point A to point B. I've said this FOR YEARS!!! We need a moon shot effort in this dept. A longitude prize in this effort. The free market won't work here because oil comes in cheaper to the US's detriment. Let's put the cost of our military into a gallon of gasoline. For the life of me I don't get how people can't see this!!!!

I agree with 90% of what you say here... but its not the American consumer's fault that they choose the cheaper of the available options, expecially when most of the other options require personal investments that they cannot afford (like in a 40,000+ hybrid)... and/or compromises in safety... I saw a large GMCcrossover SUV that gets 32mpg while the smart car gets 41?? Is it really worth 9mpg to decrease your volume from 100sq ft to 4??

Ethanol and Nat Gas as fuel are EASY substitutes for imported oil... even if we have to import the ethanol, it is from far more stable places than the middle east... Drill here, drill now... Convert fleet, rental and government vehicles (who normally have central fueling stations anyway) to nat gas

I wonder how much better off we'd be if we'd invested the money we invest in inefficient corn ethanol subsidies and cash for clunkers into converting public vehicles to USE ethanol. How much less aid would we have to send to places like Haiti/DR and even SA where we spend billions trying to stop drugs if they had an alternative cash crop.

You know how many ethanol processing/distilling/refining companies are in Chapter 11 or 7 just in the Western District of Texas? I know of at least five.

Somebody bet big and lost on corn and in the process. Right now ethanol isn't going to happen. Owl 69/70/75 knows the numbers better than I do, but you need gasoline at $3.25-$3.50 to make ethanol "work" other than as a gasoline additive. I paid $2.12 today for unleaded.

I'm still waiting for the Aggies to get the genetically egineered bugs perfected that can ferment butanol in economically feasible quantities. It has almost the same chemical energy per gallon as gasoline.

(10-09-2009 07:13 PM)Owl 69/70/75 Wrote:  Natural gas is not as easy a substitute as one might think. We don't have the distribution infrastructure in place. Ethanol also requires changes to the distribution infrastructure, but putting those changes in now means they will be there when things like cellulosic ethanol become feasible. Electric cars also require substantial infrastructure changes, but those could also facilitate making electricity the prime mover for any number of uses--expanded mass transit, inter-city passenger and freight rail, etc.

Brasil solved it. So can we. But Brasil didn't solve it by doing the things we have done since Jimmy Carter created the energy department. Neither will we.

Shell had a CNG infrastructure set up at some of its stations, but it died.

69/70... The reason I suggested fleet/rental and government cars is because they generally use central fueling stations and are already purchasing fuel in bulk (ok, maybe not all rental cars) lessening the need for every competitive gas station to have a NG pump. This takes some of the infrastructure pressure away...

Think about having pumps at Metro, HPD, HISD and some CIty buildings... Let them offer a public pump station for those willing to travel to where they are to fill up... then add interstate truck stops. SOMEBODY will make a "convert your propane tank or home gas connection to a gas pump" invention and suddenly we're in business.

Shell died because there wasn't enough demand. By putting it in a captive audience and allowing people to buy it if they want it... you create a demand that wouldn't otherwise exist

(10-09-2009 07:19 PM)WMD Owl Wrote:  You know how many ethanol processing/distilling/refining companies are in Chapter 11 or 7 just in the Western District of Texas? I know of at least five.
Somebody bet big and lost on corn and in the process. Right now ethanol isn't going to happen. Owl 69/70/75 knows the numbers better than I do, but you need gasoline at $3.25-$3.50 to make ethanol "work" other than as a gasoline additive. I paid $2.12 today for unleaded.
I'm still waiting for the Aggies to get the genetically egineered bugs perfected that can ferment butanol in economically feasible quantities. It has almost the same chemical energy per gallon as gasoline.

The problem is that CORN is the wrong feedstock for ethanol. Corn ethanol does need gasoline over $3/gallon and/or massive subsidies to work. It basically takes 1 gallon of fuel (gasoline/diesel/ethanol) to produce 2 gallons of corn ethanol; with sugar cane that ratio is 8 to 1. The Brasilians can produce sugar cane ethanol for under $1/gallon. So we subsidize corn ethanol and tax imported sugar cane ethanol until the two are at parity.

The bugs and other laboratory solutions are out there, but they're 25+ years away from getting out of the lab and onto the street. In many cases the basic process works, but it doesn't work to scale, or can't be used without massive infrastructure that is not in place, or is simply too expensive.

I do think we should tax gasoline up to $4/gallon or thereabouts, and minimize the harm to the economy by giving the money back with tax cuts elsewhere. Then ethanol--corn or sugar cane--becomes very competitive, and other alternatives start to get there. Whatever net revenues we derive from the tax should then go to infrastructure improvements that will enhance conservation--mass transit, electric intercity rail, improved electric infrastructure to support those plus electric cars.

Why did we end up with corn ethanol? Probably because the Iowa caucuses lead off the presidential primary season.

Other than alternative fuels, we need some type of new industry. One that we do better and faster than any other in the world that we can export. I would say something like hemp (very small/insignificant thing, but I can't think of anything else), it can be used for some of everything. I guess another would probably be clean tech.

(10-09-2009 09:57 PM)nomad2u2001 Wrote:  Other than alternative fuels, we need some type of new industry. One that we do better and faster than any other in the world that we can export. I would say something like hemp (very small/insignificant thing, but I can't think of anything else), it can be used for some of everything. I guess another would probably be clean tech.

There are new industries coming along all the time. We don't get them because our tax and regulatory policies discourage them. Since high-tech industries typically don't have to locate near a supply of natural resources, they can pretty much go anywhere. They're going to go where they get the best deal. If we want them to come here, we have to meet the competition.

That doesn't mean we pay labor $3/day and/or trash the environment like some countries do. We have to create advantages elsewhere.

Ireland lowered their top corporate income tax rate to 15% about the same time as robotics took off. Guess who got the robotics industry? That is the kind of industry, and those are the kinds of jobs, that we should be getting. True, Ireland is hurting right now, because the economic slowdown hit them just like everyone else, and it hit them when they were in an expanding mode. But my guess is that they'll come back.

(10-09-2009 10:06 PM)Owl 69/70/75 Wrote:  Ireland lowered their top corporate income tax rate

So what is the optimal US corporate tax rate?

(10-12-2009 04:03 PM)Lord Stanley Wrote:  

(10-09-2009 10:06 PM)Owl 69/70/75 Wrote:  Ireland lowered their top corporate income tax rate

So what is the optimal US corporate tax rate?

10% or below

Any income related tax should be 10% or below, ideally, IMO. We have a long way to go to get to that point, if its even possible.

My approach is what I'll call the 15-15-15 plan that was reached independently by several different teams of blue-ribbon economists that were engaged by the former Iron Curtain countries to design an optimized tax structure.

1. 15% payroll tax (works just like our social security, 1/2 employer, 1/2 employee, but with no upper limit)
2. 15% tax on business profits (corporation, partnership, LLC, you name it)
3. 15% value added tax

No personal income tax. No 1040. No April 15. You would still need the IRS or some agency to administer it, but audits could be 100% at the business entity level, so you could achieve a lot higher compliance without so much disruption, hate, and discontent.

I've run the numbers, and if you had those three components, and incorporated the Boortz-Linder prefund provision of the "fair tax," at a 30% rate (to offset 15% payroll plus 15% VAT), you would raise enough money to have balanced Shrub's pre-TARP budget. You would want the enabling legislation to provide specifically that three tax rates move in unison, and that the prefund rate be set at twice the tax rate.

At 15%, our marginal rates would be substantially lower than most of the rest of the world. That would help attract capital, businesses, and ultimately jobs.

The VAT would help balance of trade in two ways, by making imports more expensive (by treaty we get to add it on to imports) and making exports less expensive (again by treaty, we get to rebate it on all export sales). There are 30 OECD members (basically the world's advanced economies), and 29 of them have VATs. We are shooting ourselves in the foot by not doing the same.

My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

(10-12-2009 04:45 PM)Fo Shizzle Wrote:  My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

you contract with any of the big national builders in CLT/Raleigh/Gboro? If so who is strongest position in CLT right now, in your opinion?

also, any advice on a cheap way to build a nice Wet Bar(i.e. cabinets, sink, granite top)? I figure there is alot of excess inventory floating around that can be bought cheap

(10-12-2009 04:45 PM)Fo Shizzle Wrote:  My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

By the time the housing glut is resolved, the impacts of paying for TARP and "stimulus" and Obamacare will be making themselves felt. And that will trigger the second dip in the "W". We are better off today than we will be a year from now. Way better.

(10-12-2009 04:53 PM)Owl 69/70/75 Wrote:  

(10-12-2009 04:45 PM)Fo Shizzle Wrote:  My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

By the time the housing glut is resolved, the impacts of paying for TARP and "stimulus" and Obamacare will be making themselves felt. And that will trigger the second dip in the "W". We are better off today than we will be a year from now. Way better.

I agree. Implement what Mach wants to see implemented and we'll be in a worse off place than 1934.

(10-09-2009 11:30 AM)Machiavelli Wrote:  I wholeheartedly agree with Owl 69 here. We need short term pain for long term gain. Good luck trying to get elected that way btw! ........

The American people nor the politcal class have the stomach to do what is right until it is forced on them and it will happen. The economic forces can not ne stopped.

Machavelli said the gov/fed is devaluing the dollar by design. I agree with that, however they are doomed to failure unless they impose Weimar type inflation upon us. You have heard the experts talk on TV about all "the money on the sidelines" or the "anks have the money they won't lend". The reason those funds will not be invested or lent there is belief in the underlying asset. We are witnessing a tremendous deleveraging in the economy and a contraction in the velocity of money.(ie. people holding money ar .15% ) The FED is trying to PUSH people into risky assets and they are not moving. They are bidding up paper/credit and people/money still sit on the sidelines. We are witnessing in live time a Japanese type slowdown / contraction, similar to the lost -20- years since 1990.

The dollar will get STRONGER since people are holding dollars. In addition with foreclosures and bankruptcies (credit) dollars are being destroyed faster than the fed & government are printing dollars.

(10-12-2009 04:53 PM)GGniner Wrote:  

(10-12-2009 04:45 PM)Fo Shizzle Wrote:  My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

you contract with any of the big national builders in CLT/Raleigh/Gboro? If so who is strongest position in CLT right now, in your opinion?

also, any advice on a cheap way to build a nice Wet Bar(i.e. cabinets, sink, granite top)? I figure there is alot of excess inventory floating around that can be bought cheap

We mostly supply the kitchen cabinet and furniture industries.

GG There should be plenty of small custom KC guys in the Charlotte market that are begging for work. I'd say have one custom build that for you at a savings. It is a hard market right now with materials costs up but you may save on labor.

If it was me...I'd buy stock and install myself. KC installation is not that hard to do. The granite will be your biggest cost. You might look into "Granite Transformations" as way to cut costs. I did a KC remodel for a friend and saved almost 1/2 by using GT instead of solid granite. Only "you" would ever know it by looking at the finished product.

(10-12-2009 04:53 PM)GGniner Wrote:  

(10-12-2009 04:45 PM)Fo Shizzle Wrote:  My view...It sucks and will continue to suck for at least another 2 quarters. Until the housing glut is resolved...nothing will improve greatly. Housing is the fuel for a good economy. The construction business is DEAD.

you contract with any of the big national builders in CLT/Raleigh/Gboro? If so who is strongest position in CLT right now, in your opinion?

also, any advice on a cheap way to build a nice Wet Bar(i.e. cabinets, sink, granite top)? I figure there is alot of excess inventory floating around that can be bought cheap

For my bar in my media room I bought some "display model" Kraftmaid cabinets at Home Depot. (70% off) Sure some nicks and scratches, but nothing a little stain and puddy didn't cover. For the countertop I bought was "scrap" granite ( I only needed 4 feet) and while it isn't from the same slab, you can't really tell. Cost $20.00 sq. foot. The only thing I really spent much money on was a copper sink and the faucet. The most expensive part of the project was running the electrical wiring and the plumbing since the "bar" is a converted coat closet.

(10-12-2009 04:38 PM)Owl 69/70/75 Wrote:  The VAT would help balance of trade in two ways, by making imports more expensive (by treaty we get to add it on to imports) and making exports less expensive (again by treaty, we get to rebate it on all export sales). There are 30 OECD members (basically the world's advanced economies), and 29 of them have VATs. We are shooting ourselves in the foot by not doing the same.

What about the claim that a VAT is essentially a tax increase on the middle class, who do most of the household disposable and commodity purchases?

(10-13-2009 08:08 AM)Lord Stanley Wrote:  

(10-12-2009 04:38 PM)Owl 69/70/75 Wrote:  The VAT would help balance of trade in two ways, by making imports more expensive (by treaty we get to add it on to imports) and making exports less expensive (again by treaty, we get to rebate it on all export sales). There are 30 OECD members (basically the world's advanced economies), and 29 of them have VATs. We are shooting ourselves in the foot by not doing the same.

What about the claim that a VAT is essentially a tax increase on the middle class, who do most of the household disposable and commodity purchases?

Any tax ends up being mostly a tax on the middle class.

Don't believe me? Follow any tax through to its logical conclusion, and the middle class ends up paying.

The trick is to raise the money you need while doing the least harm to the economy in the process. It appears that broadening the tax base and lowering and flattening the tax rate structure is the best way to do that.

(10-09-2009 12:10 PM)Owl 69/70/75 Wrote:  That's basically a 20% reduction, and Europe runs a comparable economy on 40% less than we use, so there ought to be a way to get there over time.

I'm henpecking here, but we've already discussed, ad nauseum, the flaw in that argument - Europe also has a much denser population, with a fantastic system of public transportation. It's not quite apples to apples, though I do agree with your general sentiment.

(10-09-2009 03:02 PM)At Ease Wrote:  Scalia's solution for more productivity: fewer lawyers.

Quote:I mean there’d be a, you know, a defense or public defender from Podunk, you know, and this woman is really brilliant, you know. Why isn’t she out inventing the automobile or, you know, doing something productive for this society?

I mean lawyers, after all, don’t produce anything. They enable other people to produce and to go on with their lives efficiently and in an atmosphere of freedom. That’s important, but it doesn’t put food on the table and there have to be other people who are doing that. And I worry that we are devoting too many of our very best minds to this enterprise.

http://blogs.wsj.com/law/2009/10/01/scal...lawyering/

I'd have to agree too. Same with many other white collar professions.

What i dont like in this collective analysis, is any conclusion or allusion to our standard of living needing to drop to third world equivalency (the old industrial model). Our economy doesn't need to move back to manufacturing basis, but forward towards a design innovation and problem solving basis. Science innovation over pure manufacturing basis.

[edit] Because I know how that last comment will be taken - I'm not saying don't manufacture or produce goods. But we will never again be competitive on just that basis. We'd have to revert to the lowest common denominator standard of living to achieve even a marginal competitive advantage, and that's just not going to happen here, nor should it. Our productivity standard should be manufacturing to support innovation, not the other way around.