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November 19, 2009

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Mr. Talton wrote:

"Suntech was also roped in by the solar and sustainability research at ASU, some long-standing but much ramped up under Michael Crow. The Kookocracy has consistently cut university funding and scoffed at research."

A recent study, commissioned by a forum of local city governments, gave a 30-year "snapshot" of state tax collections and spending.

The report, "Understanding Arizona's Fiscal History" is illuminating in several respects, but is particularly relevant in the present instance in showing that, while K-12 funding has held level over the past 30 years, universities have absorbed an 8 percent drop in their share of state spending. Meanwhile, spending on prisons increased by 5 percent.

http://www.azcentral.com/arizonarepublic/local/articles/2009/11/18/20091118governing1118.html

Thanks to Mr. Talton for providing the realpolitik behind SunTech's local investment. To his list of Chinese protectionist tools, add its currency manipulation schemes, which keep its exports artificially competitive. As Robert Reich noted in a recent Wall Street Journal editorial:

"Despite the Obama administration's entreaties, China will continue to peg the yuan to the dollar -- when the dollar drops, selling yuan in the foreign-exchange market and adding to its pile of foreign assets in order to maintain the yuan's fixed relation to the dollar. This is costly to China, of course, but for the purposes of industrial and social policy, China figures the cost is worth it."

http://online.wsj.com/article/SB10001424052748704431804574537892719150978.html?mod=WSJ_hps_sections_opinion

Mr. Talton also wrote:

"Passive solar on the roof won't air condition your house or ameliorate endless single-car occupancy driving and the environmental, economic and social consequences of sprawl."

Asking Americans to abandon their single-car occupancy, whatever the policy merits of such a proposal, may be psychologically untenable. The need to address these issues nevertheless persists.

Recently, former Shell Oil President John Hofmeister (who retired in 2008) spoke at ASU. According to The State Press:

There is a grave problem with the current energy system in the U.S., Hofmeister said.

"If we stay on our current energy system course, by 2018 we will enter an unprecedented era in American history: the age of the energy abyss," Hofmeister said.

He predicted continuous and sustained blackouts and gas rationing if the country doesn’t adopt a new energy system within the next decade.

http://www.statepress.com/node/9390

Hofmeister's comments are noteworthy for their no-nonsense characterization of both the economic problems and the entrenched political interests behind them. As the founder of Citizens for Affordable Energy, he's pushing for an independent regulatory agency to foster the transition to a new energy system:

The new agency he calls for would manage the supply of future energy resources, embrace technologies that would make energy efficient and affordable, cap the carbon footprint of energy emissions and decide what infrastructure changes need to be made.

"[The proposed regulatory agency] threatens the authority of existing elected officials, who are elected, in their minds, to make the decisions that make us energy secure," Hofmeister said. "They have failed for 40 years, and they’re running out of time."

It’s up to everyday citizens to spark a real change in the energy system of the U.S., Hofmeister said.

"The grassroots of America, the citizens, the students, the business people, the communities who have their interests and their children’s interests in mind … will deliver environmental and economic justice and security," he said.

Citizens need to pressure their elected officials to support an independent regulatory agency, or fail to be re-elected, Hofmeister said.

* * *

Wow. Perhaps there is some devious commercial interest behind this, but frankly I'm impressed simply because you don't hear former oil company presidents talking like this every day.

Another recent initiative involves a coalition of private and governmental parties, the Electrification Coalition:

Issuing a lengthy plan to electrify the nation's fleet, the coalition urged Congress to pass a series of tax credits and loan guarantees to bring 14 million electric cars to the road by 2020 and more than 100 million by 2030. The group envisions a network of electric vehicles in six to eight cities in the short term and an expansion across the country, making 75 percent of all vehicle miles traveled powered by electricity by 2040.

"There's no pie-in-the-sky here," said Frederick W. Smith, FedEx's chairman, president and CEO. "It's simply a matter of organization, a matter of will and a matter of execution."

Participants, however, acknowledged that the proposals would be expensive and would require a major commitment from Congress. The group's blueprint would cost more than $120 billion over eight years and promote tax credits for the installation of advanced batteries, loan guarantees for the retooling of plants, and tax credits for public charging stations and home charging equipment.

Nissan President and CEO Carlos Ghosn said the auto industry was working quickly to develop zero-emissions cars in response to concerns about oil security, tighter emissions requirements in the United States and elsewhere and a public thirst for alternative vehicles not tied to petroleum.

Ghosn said the world market of 600 million vehicles is expected to expand to 2.5 billion vehicles in 2050 with the growth in vehicle purchasing in developing nations such as China and India, making electric cars a must. Nissan is releasing the Leaf, an all-electric car, in limited numbers next year and plans to put the vehicle into mass-production globally in 2012.

"The time is right for electric cars -- in fact the time is critical," Ghosn said.

http://www.wtop.com/?nid=111&sid=1814051

I don't know if the "$120 billion over eight years" figure is understating the costs -- I suspect so -- but if correct, this would work out to a relatively modest $15 billion a year, which could be funded by the simple trim of a small amount of fat in the Defense Department's budget.

I stopped reading this after Jon proclaimed that America was in "good economic health in the 1980's." I may not have been an adult, but I know the facts.

America was not in great health, and Arizona was even further back with Phoenix suffering a nearly 12% unemployment rate by 1983! Good research Jon, America was on top of the world and the Japanese weren't buying huge real estate in the U.S. Wait...

So now Mr. Talton thinks that steps in the right direction MIGHT somehow not be enough; is anyone surprised? Or that SunTech IS THE ONLY PLAYER; this is how he writes and spins his banter. I laugh every time I read such silly anti-Phoenix propaganda. Seattle may be my "home" but it sure makes people hateful and angry for some reason. Maybe lack of sun is one reason; Oh, but after writing that I may just show my true colors as an ad-man or PR "clean-up" and sun-loving right-wing kook.

LOL; just for some added confusion, I am a liberal and not a republican and have lived 25 years out of my 28 years of life outside of Arizona; and far from Arizona for that matter. I just have, perspective.

C'mon Cisco. Whatever your self-vouching gifts, perspective isn't one of them. What Talton means by the 80s was America's still-strong manufacturing sector, its huge lead in technology and research, its still healthy balance sheet, and its economy that hadn't been completely handed over to Ponzi-scheme artists. The sharp recession of the 80s was corrective, not devastating. The inflation from the energy shocks was tamed and the country returned to economic health fairly quickly. If you can't tell the difference between the early 80s and the current situation, you're perspective is more a matter of self-delusion than anything else.

Cisco Corrales, like other image control spin-meisters, has the ethics and the meretricious appeal of a common streetwalker: at any given moment, he'll say whatever he thinks will earn his money, regardless of the ludicrous inconsistencies.

At this moment, he's pretending that Seattle is his "home" and lamenting non-existent anti-Seattle tendencies (where?!) in Mr. Talton's present essay. By contrast, in the recent Greenscam thread, Mr. Corrales had this to say about Seattle sensibilities:

"The problem is, many of you leftist kooks in the northwest fail to see your region's short-comings and instead find comfort in pointing at other region's problems. While we are taking care of business many of you have your thumbs up your bums looking south for what little comfort you can in the mean time."

And this:

"...the only thing that smells worse than the "right wing Arizona kookocracy" is the extreme left wing kookocracy. No matter whose rear-end it is coming out of it is still B.S. only the left has an added pungent odor because of a steady diet of self-congratulating empty carb cakes."

Well, tell us what you really think, Cisco! (Or at least, what your masters really think.) And where is your little friend, Terry Dudas of Galtnet?

Corrales added:

"I laugh every time I read such silly anti-Phoenix propaganda."

What did I tell you: practically everything Corrales writes stinks of chauvinism and brands him as a (paid?) apologist. It seems that somebody, somewhere, is worried enough about Mr. Talton's essays to regard them as a public relations threat. Good for Talton! Now he's been paid the ultimate (if backhanded) compliment.

Jon, thank you again for the cutting critique of what happens in AZ, even despite your typically cynical reaction to an otherwise positive story; for an unexamined state is not a state worth having (or something like that). But as a native Arizonan who has chosen to remain here as an adult striving to improve my community, I have a tough time with your consistently bitter tone--especially because you have relocated yet remain focused on the place you left.

So I feel that it warrants a minor nitpicking correction of one of your comments. That is the misnomer that Arizona's need for air conditioning somehow creates an excessive demand on energy production capabilities. Actually, fighting the desert heat is much greener than dealing with extreme cold, as is faced by much of our country's largest cities. This is due in part to the physics of energy differentials, but more to the point that cold places tend to also turn up the a/c in the summer despite their high heating fuel usage in the winters.

And then there's the issue of the single-driver cars on our roadways during rush hour, combined with the ongoing growth of the roadway system. Granted, this is bad. And it's a bad mark that our city has known for some time. Meanwhile, however, our new light rail system has continued to prove itself as a viable concept and plans for its expansion have already been accelerated, despite the declining economy (and btw, it has beaten estimates of ridership by 60% to date). Please see http://www.treehugger.com/files/2009/06/phoenix-light-rail-metro-tempe-mesa-map-video.php for more info. Add to this the ongoing discussions of a much needed regional rail system connecting Phoenix and Tucson with other cities in the Southwest, as well as providing commuter service to the suburbs, and you catch my drift (see conceptual plans at http://www.bqaz.gov/index.asp). And it's important to note that Phoenix has rarely ranked high on any lists for the worst traffic in recent years (see http://www.forbes.com/2009/02/24/traffic-intersections-worst-lifestyle-autos_intersections_full-list.html)

And finally, you isolate the news about this single Chinese company and take it out of an important context. Arizona is already home to First Solar, which is a leading solar firm with a technology uniquely suited to warmer regions, as well as German, Spanish, and other solar companies making significant investments here. So like the semiconductor boom in the 70s/80s, solar production companies stand to offer a great deal of desirable jobs to a region that needs them. This is good news! (And even though many of those semiconductor facilities have moved or sold off, their massive buildings tend to attract desirable new employers even after the original occupants abandon the facilities).

So while you continue to raise awareness of our region's shortcomings, I see it as my duty to stand up and improve my community. After all, Phoenix as a major U.S. city is still relatively new and malleable in many ways. And it has usually stayed ahead of the curve in comparison to other areas of the U.S., thanks largely to its strong push-pull path to change and improvement. I urge my fellow residents to remain optimistic and driven to protect and enhance whatever it is they love about this place. And most importantly, let's encourage an ongoing discussion about what we want positive changes we want to affect, even when consensus is hard to find on many issues.

Pay no attention to the local defensiveness. Thanks for your incisive and sophisticated analysis on Arizona. Your blog is the only place we can get it.

This is funny. This is the "sunniest" post on AZ's possibilities for recovery that Jon has ever posted (to my recall, anyway), and he's being nailed for his (practically trademarked) iconoclasm.

Any social psychologists out there? /snark

LS, did you ever get a chance to read Mr. Talton's biz columns when he worked at the Republic? If not, you missed out -- he pulled plenty of punches, but those columns were just as cynical and sarcastic as any entry that you'll read on this blog.

For your enjoyment, I've pasted below one of my favorite columns that Mr. Talton wrote while he was at the Republic (Now, the Information Center):

Decline and fall of Mesa
Watching this city's economic implosion is like viewing a train wreck in slow motion

Jon Talton
Republic columnist

May. 21, 2006 12:00 AM

I wish it were simple enough to say: Mesa, be gone!

Now that you've voted down a property tax, live your libertarian state-of-nature fantasy. Allow City Hall to do no more than fix potholes, police the streets and fight fires. Shut down the public libraries and museums. Sell the Mesa Arts Center to a check-cashing outlet. Make the heaviest burden of a sales tax fall on the poorest people, those losers. Let freedom reign!

If only Mesa were an eccentric little burg in, say, Idaho. We could watch its deterioration at a bemused or horrified distance. Here is a city as a slow-motion train wreck. We can't quite avert our eyes, but it doesn't really affect us, thank goodness.

America seems to agree.

Mesa is more populous than St. Louis, Minneapolis, Atlanta, Pittsburgh or Cincinnati - not that Mesa has anything to show for it. A fiscal crisis, rejection at the polls and immediate layoffs and cuts to cultural programs in those cities would have been major news.

Yet as far as I can tell, the mess in Mesa garnered no national coverage, and little regional attention either.

Unfortunately, Mesa is too big and too close to ignore. The city's civic sickness, economic malaise and ongoing deterioration hurt all of Greater Phoenix.

If Mesa were boxing at its weight class, the entire regional economy would be stronger. Instead, some 65 out of 100 Mesa residents must commute elsewhere to find jobs. It has no major corporate headquarters and no economic engines equivalent to a city of its population.

Mesa should also be a powerful advocate for the urban issues it and every city face with the state Legislature and congressional delegation.

To take but one example, Mesa should have been a leader in creating the nation's best regional transit system.

Instead, it grudgingly allowed a one-mile link to light rail and asks the city of Phoenix to run its meager transit.

With so many people, Mesa should have one or two universities (Cincinnati has three major universities in the city limits). Instead, it is hoping ASU will enhance its minimal campus at the seedy former Williams Air Force Base, far from the heart of the city.

An entire column could be devoted to this failed city's missed opportunities in innovation, culture, quality of life and sustainability. Another could track how its legislators often lead efforts to keep the state backward.

Then there are lessons that apply to the entire region. Almost every mistake seen in Greater Phoenix has been taken to its absurd, entropic conclusion in Mesa. It proves:

• Minimal taxes and government don't produce a high-performance economy. Indeed, Mesa, like all of Greater Phoenix, would barely exist without mighty deeds of collective action and heavy government spending.

• Building a new shopping center, anchored by a tricked-out bait shop, is not a 21st century economic strategy.

• Denial of urban challenges doesn't make them go away; they get worse.

• Cities add to their "carrying costs" as they grow in population. Among them: stresses to infrastructure, economic diversity and social health.

• The free-lunch promise of the anti-tax right remains seductive. Gone is the American presumption that with property ownership comes special obligations to the community. It only delivers failure.

Perhaps the most ominous cautionary note is that of the single-flavor, self-selecting city. It's an open question whether Greater Phoenix is such a place, but there's little question about Mesa.

With the city's rising Hispanic population in the shadows, those in Mesa who vote and wield power are overwhelmingly White and "conservative." Many are retirees who apparently fit the stereotype of "I got mine, leave me alone!"

Lacking is any meaningful competition of interests and ideas that would help Mesa face the real world.

And make no mistake: The world will not let Mesa be just a quiet small town. Yet this city is poorly positioned to address global competition, climate change, higher energy prices or other 21st century realities.

I'll admit to using the term "city" generously. Mesa is more of a collection of real estate ventures connected by highways.

The sound civic design of the Mormon pioneers was abandoned as Mesa grew. Its subdivisions, and especially the so-called master-planned communities, were built to segregate people from a city's challenges, opportunities or even identity.

Mesa, be gone! If only Mesa alone could face the full consequences of its actions. Its voters would find out what the state of nature is really like.

Instead, it will continue to be carried by the rest of the region, with the most successful cities deliberately avoiding Mesa's policies.

Welcome, Patrick, and thank you for a timely illustration of the Rule of Two. Let's hope the young Sith apprentice received a spanking.

But if I may quibble with your quibble:

Mr. Talton did not assert that "Arizona's need for air conditioning somehow creates an excessive demand on energy production capabilities". What he actually wrote was: "Passive solar on the roof won't air condition your house", a completely different proposition.

Patrick's proposition, by contrast, is a little difficult to evaluate, as perhaps it was meant to be. He states that Phoenix's blistering summer (and increasingly, spring and fall) heat doesn't "create an excessive demand on energy production capabilities". Since it isn't clear what constitutes an "excessive demand" in this case, that will have to pass, despite the obvious truism that high summer heat results in high demand for electrical production and consequently high cooling bills for A/C users.

But if "cold places tend to also turn up the a/c in the summer despite their high heating fuel usage in the winters" might it not be true that hot places tend to also turn up the heat in winter despite their high electrical usage in the summers? After all, those acclimatized to 115 degree daytime highs tend to develop an intolerance for "cold" temperatures which their midwestern counterparts would regard as balmy and comfortable.

As for First Solar, I'm glad it's here and would like to see more of a presence from it. Instead of the new manufacturing plant it plans to build in France, why not our pleasant Valley of the Sun? Or shall we give a Gallic shrug, pronounce c'est la guerre, and remove ourselves to the nearest Starbucks "cafe"?

"First Solar employs about 4,000 people worldwide, including about 100 administrative and management workers at its Tempe headquarters, spokeswoman Lisa Morse said.

"The company operates manufacturing plants in Ohio, Germany and Malaysia and has plans to build a factory in France. It also is helping customers, including utilities, build solar-power plants."

http://www.azcentral.com/business/articles/2009/09/03/20090903biz-honeywell0904.html

So, as delightful as it is for the Valley of the Sun to host First Solar's 100 or corporate administrators, instead of trying to kill the messenger (Mr. Talton) why not concentrate your guns on those legislators whose perennial short-sightedness has resulted in the decision to build a factory in France (scarcely third world labor rates) instead of Arizona?

I applaud you if your duty is to "stand up and improve our community". But if this is merely a euphemism for papering over shortcomings in the vain hope of attracting purblind investors, I would contend that this represents, not community leadership, but a kind of salesman's prayer.

P.S. That should have read "...100 or so..."

I agree that the Mesa column was one of Mr. Talton's best.

Just to play devil's advocate, however, Mesa's Boeing and MD helicopter plants are economic anchors which the city has vigorously courted.

In the Friday, November 20th issue of the "Mesa Republic" (a community insert of the Arizona Republic) there is an interesting article titled "SE Valley Mayors Push for More Collaboration".

Unfortunately, I can't find a link, since the Info Center has apparently seen fit to exclude this article from its website, but here is an excerpt:

The problem, [Tempe Mayor Hugh] Hallman said, is a state tax code "that tends to pit cities against one another and exacerbate our friction and undermine the ability to work together regionally".

Chandler Mayor Boyd Dunn suggested, however, that landing a retailer who would otherwise locate elsewhere in the area isn't real economic development.

"We're confusing two seperate issues here" Dunn said. "One is the attraction of retail. The other is the attraction of business.

[Mesa Mayor Scott] Smith agreed and said the Legislature must update Arizona's economic-development policies.

"[It's] not Tempe vs. Mesa but it's Arizona vs. Colorado vs. India vs. Singapore," Smith said. Many of the things we need are merely to level the playing field."

The mayors also criticized the legislature for locking cities into a failing tax system and for not being creative in handling Arizona's deepening budget crisis.

"Most of us...are funded by sales taxes to a large degree," Hallman said. "And that is a very volatile sector...It's not going to get better, because the cities don't have the opportunity to change that model. It's going to have to be done at the state level."

He said a system based more on property taxes would stabilize local revenues...

The mayors also said the Southeast Valley must aggressively pursue various modes of mass transit.

Among Hallman's priorities: one commuter rail line from Tempe to the Gateway area, and another from Tempe to Maricopa, which emerged almost out of thin air early this decade as a residential boom town.

Noting that half a million people could occupy Maricopa in the future, Hallman said, "If we don't deal with Maricopa today, the freeway system will get so clogged up, it will make today's congestion look easy."

Like the town of Buckeye, I seriously doubt that half a million people will ever live in Maricopa. Peak Oil will see to that.

I greatly appreciate the debate here.

Here's an interesting indicator of the state of Mesa's current economy: on November 2nd the Mesa Police announced that 25 new positions had been created by stimulus funds and that they were taking applications from qualified applicants. Thus far, they have received 2,000 applications.

http://www.azcentral.com/community/mesa/articles/2009/11/19/20091119mr-chief1120.html

Just to be sure I understand the dynamics here:

The kooky leadership of a red American state is celebrating the fact that they have enticed "Reds" to build a commie-funded plant on American soil (perhaps even, within the red state's capitol city limits).

And for this 250 job sell-out to the communists the kooky state government agreed to not tax the Reds so badly and the federal government may even have to further subsidize the Reds for "manufacturing" this stuff on American soil.

Do I have that right?

If so, then this only makes sense if you believe one thing: Americans are not smart enough to build their own solar voltaic plants and need freedom-hating commies to do it for them.

The Phoenix people that made the decision to welcome "The Reds" ought not to be boasting about it. Instead they ought to be wearing a tattoo on their ass that reads: We sold American ingenuity out to commie socialists because capitalistic America is now a beggar, can't do, third-world nation that needs commie help...

How embarrassing. And how sad that American expectations are so low that this swindle is now celebrated as a victory. Everyone knows China is working to corner the market on recyclable energy. This just facilitates their plan...

Shameful.
Some kooks must be getting kickbacks.
That's the only way to explain the treachery to their own country.

Well, it may be couched in Dukes of Hazard rhetoric, but in certain limited respects "koreyel" has a point.

Because there is no uniform tax structure in the United States, each state, and even locality, is pitted against one another in a race to see who can offer capitalist investors (of any nationality) the most give-aways; who will, as a lamentable but necessary practicality, allow these corporate powers to escape their civic duties of supporting the social infrastructure of which they are a part. The last time I checked, corporate income taxes paid only 8 percent of Arizona state revenues. That IS shameful.

And frankly, the question of why we don't do this ourselves is a good one. Obviously, part of the answer is that the so-called "free market" is not (and never has been) free, but actually operates within a framework of laws determined by governments (federal, state, and local).

That framework includes not only wage laws (which should be uniform and designed to support at minimum a living wage -- honest pay for honest work rather than the exploiter's wage slavery -- but also the laws governing trade: the movement of capital, raw materials, and goods.

What good does it do to have a minimum wage (inadequate though it is at present), and the (nominal) freedom to organize unions and collectively bargain, and the workplace and environmental laws necessary for a decent standard of living (but adding overhead to the cost of doing business), when corporations are free to move lock, stock, and barrel to places like China, where independent unions are banned, prison labor (including political prisoners) is exploited, regulatory protections are virtually nonexistent, and the government, through a combination of totalitarian force, currency manipulation, and its own protectionist framework of laws and rules governing investment, is able to keep the price of its goods artificially competitive?

Obviously, trade laws need to be redrawn to make sure that market competition takes place on the basis of creativity, talent, and natural resources, rather than on an unequal playing field in which advanced nations are at a permanent disadvantage due to a higher standard of living and higher pay scales, among other factors.

Thanks so much for the article This was just the thing I needed to read

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