The unending (and infuriating) irony of this election will be that the Democrats won this election by first tanking the economy and then (with the aid of the MSM) blaming the hapless Republicans for it. Tom Blumer explains:
The recession, once it becomes official, will thus richly deserve designation as the POR (Pelosi-Obama-Reid) recession. Further, Obama's and the Democratic Party's performance on the economy must be benchmarked from June 1, 2008 -- not Election Day, not Inauguration Day, and not, as traditionally has been the case, from October 1 of the new president's first year in office.
Evidence of the POR triumvirate's virtually unilateral damage to the economy began appearing as early as the fourth quarter of 2007, the first quarter of negative growth in six years. The POR recession itself began in June. The historically steep downward revision in second-quarter gross domestic product (GDP) growth from an annualized 3.3% to 2.8% in the government's final September announcement was more than likely due to deterioration that occurred in the final month of the quarter.It's not at all a coincidence that June was the month in which it became crystal clear that despite sky-high oil prices, Pelosi, Obama, and Reid were hostile to the idea of drilling for more oil -- offshore or anywhere else. Pelosi insisted that "we can't drill our way out of our problems." In the speaker's world, this means that you don't drill at all. Reid declared that we have to stop using oil and coal because "it's making us sick." Obama seemed pleased that gas prices were so high, saying only that "I think that I would have preferred a gradual adjustment" instead of the sharp spike. What a guy.As would be expected, the country's businesses, investors, and consumers, never having witnessed a political party dedicate itself so completely to starving its own national economy, reacted very negatively to all of this. I said at the time that "businesses and investors are responding to their total lack of seriousness by battening down the hatches and preparing for the worst." Subsequent events have validated that observation.
As commenter Carl Pham pointed out recently, the American people bought fire insurance from an arsonist.
Posted by Rand Simberg at 06:53 AMPaul Hsieh (M.D.) has some thoughts on the inevitable issues with "universal health care."
Posted by Rand Simberg at 06:14 AMTyler Cowen has some history:
The good New Deal policies, like constructing a basic social safety net, made sense on their own terms and would have been desirable in the boom years of the 1920s as well. The bad policies made things worse. Today, that means we should restrict extraordinary measures to the financial sector as much as possible and resist the temptation to "do something" for its own sake.
In short, expansionary monetary policy and wartime orders from Europe, not the well-known policies of the New Deal, did the most to make the American economy climb out of the Depression. Our current downturn will end as well someday, and, as in the '30s, the recovery will probably come for reasons that have little to do with most policy initiatives.
There was also this little item that caught my eye:
A study of the 1930s by Christina D. Romer, a professor at the University of California, Berkeley ("What Ended the Great Depression?," Journal of Economic History, 1992), confirmed that expansionary monetary policy was the key to the partial recovery of the 1930s. The worst years of the New Deal were 1937 and 1938, right after the Fed increased reserve requirements for banks, thereby curbing lending and moving the economy back to dangerous deflationary pressures.
Why?
Because of this news:
ABC News has learned that President-elect Obama had tapped University of California -Berkeley economics professor Christina Romer to be the chair of the Council of Economic Advisers, an office within the Executive Office of the President.
It seems like a much better pick than those of us concerned about an FDRophilic president could have expected. Maybe we won't replay the thirties.
Posted by Rand Simberg at 07:05 AMJonah Goldberg explains why we should fear that Barack Obama will emulate Franklin Roosevelt:
there can be a chasm between being right and merely appearing to be right. Why anyone stakes greater value on the appearance than reality is a mystery to me.
But as Obama clearly recognizes, that was a big part of the FDR magic. FDR came into office promising "bold, persistent experimentation" -- and delivered. Raymond Moley, an early member of FDR's "brain trust," saw the New Deal for what it was. "To look upon these programs as the result of a unified plan was to believe that the accumulation of stuffed snakes, baseball pictures, school flags, old tennis shoes, carpenter's tools, geometry books and chemistry sets in a boy's bedroom could have been put there by an interior decorator," Moley wrote later.Yet Americans thought it was all part of a plan, even though experimentation and planning are in fact near opposites. Why? Because FDR always projected such confidence, even as he made things worse. But this isn't another column about how FDR prolonged the Depression. Been there, done that. I'd rather be forward-looking.
In fact, I want to be experimental, too. So here's my idea: Just stop.
Stop talking about bailouts and stimuli. Stop pondering ever more drastic action. Give it a rest. Let it be.
One of the main reasons there's all of this "money on the sidelines" out there among private investors is that Wall Street doesn't know what the government will do next. Will it bail out the auto industry? The insurance companies? Which taxes will go up? How far will interest rates go down? How long will the federal government own stakes in the banks? Will more stimulus checks go out? If so, how big will the deficit get?
Don't just do something--stand there!
One of his readers says that this also explains the current market volatility:
Free market economics involves the application of immutable laws, and it's those laws that allow us to forecast the effect of current events on various companies and the stocks and bonds they've issued. But investors will only play the game if they believe the rules aren't going to change in the middle. When government begins 'experimenting', it makes it harder for investors to generate a long term forecast. This drives long term investors away from the market, or converts them into short term traders. The result is a massive increase in volatility as investors shorten their investment outlook because they can't predict what's going to happen far enough into the future.
Volatility is an indication of instability. It's not a sign of a healthy economy but of an economy which has lost its way. High volatility isn't what you expect from the worlds largest market, but from the emerging economy of a third world country. As you can see from the attached chart, when Roosevelt began his 'bold persistent experimentation' it drove away long term investors and that caused volatility to dramatically increase. It will almost certainly have the same effect when Obama does it.Since he's so determined not to learn from the mistakes of the past, I would expect him to repeat them. I'm betting that his poking and prodding will add to unemployment, reduce economic growth, and wreak havoc with the federal deficit. There is little doubt that he's the wrong man at the wrong time. I'm just hoping that he is as devoid of principles as the Clintons, and that he finds a way to break his campaign promises or we're in for a long painful recession, and maybe worse.
We can only hope, since we lost an opportunity to do any more than that a couple weeks ago.
Posted by Rand Simberg at 08:20 AM...to the charlatans like Jim Hansen. Here are two useful books. First, Cool It
Yup. As many reviewers note, "climate change" isn't really about science--it's just the latest ideology to come along for the collectivists to use in their latest attempt to bend us to their will.
Posted by Rand Simberg at 09:42 AMHere's a fellow Flintite (Flintian) explaining why her former employer shouldn't be bailed out:
The strength of the union and the weakness of management made it impossible to conduct business properly at any level. For instance, I had an employee who punched in his time card and then disappeared. The rules were such that I had to spend hours documenting that this man was not in his three foot by three foot work area. I needed witnesses, timed reports, calls over the intercom and a plant wide search all documented in detail. After this absurdity I decided to go my own route; I called the corner bar and paged him and he came to the phone. I gave him a 30 day unpaid disciplinary lay off because he was a "repeat offender". When he returned he thanked me for the PAID vacation. I scoffed, until he explained: (1) He had tried to get the lay off because it was fishing season; (2) The UAW negotiated with GM Labor Relations Department to give him the time WITH PAY.
I supervised a loading dock and 21 UAW workers who worked approximately five hours per day for eight hours pay. They could easily load one third more rail cars and still maintain their union negotiated break times, but when I tried to make them increase production ever so slightly they sabotaged my ability to make even the current production levels by hiding stock, calling in sick, feigning equipment problems, and even once, as a show of force, used a fork lift truck and pallets and racks to create a car part prison where they trapped me while I was conducting inventory. The reaction of upper management to my request to boost production was that I should "not be naïve".Another employee in the plant urinated on the feet of his supervisor as a protest to discipline. He was, of course, fired...that is until the union negotiated and got his job back.
Eventually I was promoted to a management position where I supervised salaried employees at HQ. As I left the plant I gave management a blunt message. I told them that I expected the union to act like the union, but I was disappointed that management didn't act like management.
I saw a lot of this in the 1970s when I worked summer jobs in the shop, and my relatives who are still there tell me it goes on to this day. Of course, it's hard to put all the blame on management, when the Wagner Act made it impossible for them to do much about it, because it allowed the UAW to credibly threaten their company with bankruptcy if they didn't knuckle under. This crisis was caused by government, and bailing out the UAW will not solve it.
Also, Jim Manzi explains why we (the taxpayers) can't just buy the three auto companies for their current market value (only seven billion) and save ourselves the many more billions that a bailout would cost. It's kind of amazing that the stock has any value at all (GM's in fact doesn't). Equity in these companies currently has negative value because running them requires putting more cash into them, with no certainty, or even likelihood of return, at least with their current union contracts and cost structure. They are the proverbial white elephants.
This, by the way, is the reason that the notion of selling the Shuttle or the ISS to anyone else is a non-starter. No one could afford them, even if you gave them away.
Posted by Rand Simberg at 10:07 AMI have thoughts on "Change!" and free markets this morning, over at PJM.
Posted by Rand Simberg at 05:14 AMExploding the myths of Clintonomics:
The bull market took off precisely when then-Fed Chairman Alan Greenspan took his foot off the brakes and hit the gas in 1995. It was also then that Republicans took control of Congress -- further blunting the effects of the Clinton tax torpedo that had taken effect the previous year.
Clinton also benefitted from innovations long in the making, including the Pentium chip released in March 1993 and Microsoft's Windows program released in August 1995. These together made the Internet boom possible.As for the budget surpluses, they came as a complete surprise to Clinton economic forecasters, whose static models only predicted their tax hikes on the rich would narrow the budget gap, not get it into the black.
Their "deficit-reduction plan" didn't create the surpluses at all. They were a direct result of a tidal wave of capital-gains revenues generated by the GOP-led stock boom.
Relieved that Washington would no longer threaten to take over 14% of the economy by socializing medicine or raise taxes even higher, the market took off like a shot at that point. And capital gains tax receipts exploded, flooding federal coffers.
Clinton's own long-term budgets predicted no surpluses of any kind during his administration and beyond.
Bill Clinton never had a plan to end deficits. The Republicans and economic circumstances did it for him. But I'm sure that this myth that Bill Clinton balanced the budget will prevail in the minds of the media and Democrats, just as the false myth that Roosevelt, and not the war, got us out of the Depression continues to prevail many decades later. They have to rewrite history to justify their continued plunder. And of course, the near-term danger is that President-Elect Obama and the Congressional majority will use this mistaken history as a justification for tax hikes in a recession, which could be economically ruinous.
Posted by Rand Simberg at 06:20 AMHere's a cure for that. Let's hope he's wrong. Part of the problem is that, because panics like this are to some degree psychological, pieces like this don't help, even if they're valid. It's sort of like the Heisenberg principle--the very act of diagnosing the problem can exacerbate it.
Posted by Rand Simberg at 10:54 AMSome useful thoughts from Rod Long, over at Cato Unbound.
As he points out, there is a broad-based mythology that defending capitalism is equivalent to defending "big business" when, by its nature, big business abhors capitalism (at least as understood by true free marketeers). Of course, I agree with Jonah Goldberg that we latter should abjure the term "capitalism," both because it is such a misunderstood word with a wide variance of definitions, and because it is fundamentally a Marxist concept.
A "free-market economy" (something that hasn't existed to a large degree in this country for many decades) is what should be defended and supported, and we should continue to push to get the country to move back in that direction to find our way out of our current travails (which really started back in the Depression Era). Just as one example, there's an interesting discussion over at Megan McArdle's place, here and here, on GM's straits (about which I've also had thoughts over the years, as someone who grew up with it). I think that, as one of the commenters over there notes, the roots of the destruction of the American auto industry lie in the Wagner Act:
GM and the UAW are a perfect illustration of bad government in action.
At some point, a collective decision was made that the unions should be given such expanded powers that they could destroy the company if they wanted (see the above post describing how a strike at a key plant could idle the whole company). What happens here? Well, naturally the union tries to extract as much as they can from the company with the tools available. The union doesn't profit from increasing profits and building a healthy company, it profits from building an overstaffed company that exists to benefit its employees. The union would have been better served if it divvied up the right to collect a union payout from GM among the workers of the time and let them sell the claims. Then the union could simply negotiate the maximum dividend possible for the holders of these claims. This way you have a rationally run company with the benefits going to the larger voting block (the workers) than the shareholders who are all presumably evil capitalists.What would have been much more honest and worked better would have been outright nationalization of GM when the rules were set up that the UAW could destroy the company. Instead you've got unclear property rights and consequent ill management.
It took a long time to kill the industry, but that doesn't mean that it wasn't the cause. Arsenic or mercury can kill over a long period of time as well, though death might actually occur from some other ailment that the toxin-ridden body is ill equipped to fight.
The toxin in this case may be a lot of things (perhaps even including "capitalism" by some warped fascistic definition) but it is an abomination to a free market, and it has destroyed the American auto industry.
[Update a few minutes later]
IBD says let GM go bankrupt:
Far from vanishing, many of GM's assets would be quickly purchased by competent foreign automakers eager to expand their capacity in what is the world's largest auto market. Happily, the list of well-run car companies, from Toyota to Nissan to Porsche, is long.
How this helps Michigan, the auto sector and smaller firms reliant on the latter's health is pretty clear. With capable auto executives finally overseeing GM's poorly deployed assets, the value and utility of each would rise, thus perpetuating the existence of jobs in the sector, all the while ensuring that other businesses that exist due to GM will enjoy more stable commercial relationships with competent management.So while the cries of certain Armageddon would be ear splitting in the event of a GM failure, the U.S. auto sector would actually emerge much healthier thanks to a change in ownership that would be the certain result of GM going under.
The problem of course, is that this will be another Enron, in that many people will be thrown out of work, and lose pensions (I should note, for the record, that as a Michigan native, I have close family members who may be in this situation). The political pressure to maintain the status quo will be intense, and unfortunately, given the fact that despite all of the talk about "change," the status-quo-ante types (at least when it comes to static economic circumstances) have just entrenched their power in Washington, that's probably the way it will go. If GM is going to get federal money, it should go toward buyouts of long-term employees, and then let the market work to redeploy its assets toward more useful purposes than maintaining an expensive company-town welfare state, that makes cars on the side.
[Update mid morning]
Matt Welch says to the barricades to defend free markets. Except that he uses the confusing word "capitalism."
I should add, that I consider George Bush's biggest failure not the events leading up to this crisis, but his response to it, in which (as Matt points out) he capitulated to those advocating government solutions to government-caused problems. Of course, it's on a par with "compassionate conservatism" and "comprehensive immigration reform" and "no child left behind" and "prescription drugs" and myriad other issues, large and small, on which he showed himself to be anything but a conservative (let alone a libertarian). Had he been a Democrat, the Dems would have been cheering all of his actions as the greatest thing since LBJ and the Great Society.
Speaking of compassionate conservatism (and the tone deafness of George Bush and Mike Gerson and others to how rightly offensive the phrase was to actual conservatives), imagine how well the Democrats would take to a nominee who ran on a platform of "logical liberalism."
[Early afternoon update]
Iain Murray has more thoughts on free markets and their relationship to liberty:
...as Jonah says, markets are more than this information delivery system. Where the Chicago School has gone wrong is in focusing purely on economic efficiency. As my boss Fred Smith said way back in 1983, "The Chicago School's case for antitrust policy . . . rests solely on economic efficiency, as if rights had nothing to do with the matter -- as if business had no right in principle to dispose of its property as it sees fit, but only a conditional freedom so long as it helps maximize some social utility function. That is to say, no business is entitled to its property if that property can be redeployed so as to expand output. With 'conservative,' 'pro-business' economists taking this view, who needs social democrats." In other words, if we value property rights, the free market is an essential consequence. And that is why market socialism never works, because it devalues property rights. Liberty demands property rights which demand free markets. We only interfere with that chain in defiance of history.
It is not a coincidence that communist nations are the most unfree on earth.
[Early evening update, particularly for Instapundit readers, who might want to look around the site]
I've talked in the past about the fact that my father was a GM exec, but I've never noted what he did there.
Here's a little background, which may be apocryphal, because I only knew it from my mother, but they met after the war in New York (he was from Brooklyn). She was a former WAC who had served in Egypt, and had decided to see a little more of the world before heading back to her home in Flint, Michigan.
He was standing on a soapbox in the Village, haranguing the crowd on the benefits of Marxism. As an economics major, raised on Keynes, she fell in love.
They married, and finished their graduate degrees, at various places (NYU, UCLA, other, his in Psych--Industrial Psych, hers in Econ). In the fifties he tried door-to-door in Lansing after moving to Michigan with his upper Midwest bride, but when he got an offer at A.C. Spark Plug in her home town (as a result of her brother, my uncle, being an engineer there) he took it, and settled into a middle-class lifestyle, during the best years of the company, in which he raised his family.
He moved up though the white-collar world at AC, in "personnel" (these days, it would be HR, which is one of the reasons that he could get me summer jobs there during college), until he got an offer to go to work for corporate in Detroit, a job for which he commuted sixty miles a day each way from Flint, and we never had to move. I know that this is no big deal of a commute in southern Cal, but for me, it was amazing. He died at an age slightly older than me (right now, for those reading in the future) that I can count on one hand, and not half of it, from a heart attack (his second--he had had his first about a decade earlier, in his forties). That was almost three decades ago.
His job?
Head of labor relations, and negotiator (perhaps chief negotiator, though (as Doctor Evil said) I can't vouch for that), with the UAW.
[Bumped to the top, because there's a lot of new stuff]
Posted by Rand Simberg at 01:40 PMWhich president will Barack Obama want to emulate? He has said that he admires Reagan, but only for his transformational qualities, not for his political beliefs. But if he persists in his apparent desire to implement some combination of Hoover and FDR policies (raising taxes on the productive, protectionism, enforcing high wages), he'll end up making a bad situation much worse, and end up being a one-termer for sure.
Posted by Rand Simberg at 11:12 AMThis guy thinks so, and Sony killed it. I hadn't been paying much attention, as I rarely rent videos.
Posted by Rand Simberg at 11:25 AMIt's certainly plausible to me. Given how much of an overshoot there was, it wouldn't be surprising to see it dip that low before stabilizing. As I've long said, over a hundred bucks was unsustainable. I would hope it won't stay that way for long, though. It's harder to justify shale and new drilling (and conservation) at those prices.
Posted by Rand Simberg at 07:51 AMAnd I thought that card check was already pretty bad:
Under EFCA, the terms set by the arbitrator will be the furthest thing from a "contract." It won't be an agreement between management and labor. Rather, wages, hours and terms and conditions of employment will be dictated by a government appointed arbitrator. The mandate will be binding on the parties for two years. Neither the company nor the employees can reject it (At least when the Central Committee set the wages for tractor assembly workers in the Leningradskaya oblast there was always the possibility that the wages might change later that afternoon).
Currently, if employees don't like the tentative agreement negotiated between union leaders and management the employees can vote it down and instruct their leaders to go back to the bargaining table to get a better deal. Not so under EFCA. If the employees don't like the arbitrator's decree of a 2% wage increase, they're stuck. Similarly, if the company can't afford the arbitrator's command to pyramid overtime, the company's stuck. The consequences aren't difficult to imagine.
This is a small business owner's nightmare. As is the health insurance mandate. Obama will be a disaster, economically, at least if the Democrats get enough votes to block filibusters in the Senate.
[Update a couple minutes later]
Here's more on the job-destruction potential of Obama's health-care plans, from that bastion of right wingery, the New York Times:
the penalty in Massachusetts is picayune compared with what some health experts believe Senator Barack Obama, the Democratic presidential nominee, might impose as part of his plan to provide affordable coverage for the uninsured. Though Mr. Obama has not released details, economists believe he might require large and medium companies to contribute as much as 6 percent of their payrolls.
That, Mr. Ratner said, would be catastrophic to a low-margin business like his, which has 90 employees, 29 of them full-time workers who are offered health benefits."To all of a sudden whack 6 to 7 percent of payroll costs, forget it," he said. "If they do that, prices go up and employment goes down because nobody can absorb that."
Writ large, that is one of the significant concerns about Mr. Obama's health plan, which like this state's landmark 2006 law would subsidize coverage for the uninsured by taxing employers who do not cover their workers. And it is a primary reason that so-called play-or-pay proposals have had an unsteady history for nearly two decades.
This is 180 degrees from the direction that we need to go. Most of the problems of the current health-care system stem from its being tied so much to employment, which is an artifact of wage controls during World War II. The first critical step in fixing it is to decouple it from the job, so that plans are portable, and people are more connected with choosing their provider. McCain's plan isn't perfect, but it's a big step in the right direction, and the demagoguery of the Democrats on this issue (as on most issues) has been shameful.
Posted by Rand Simberg at 07:04 AMGreg Mankiw compares the Obama and McCain plans. Neither of them are great, but one is much better than the other.
Posted by Rand Simberg at 06:23 PMThe real reason for the GM/Chrysler merger? Not because it makes business sense (it doesn't) but because it will make them "too big to fail." So they set themselves up for failure with the merger, then the taxpayer gets to pick up the tab, and they remain uncompetitive.
Posted by Rand Simberg at 10:44 AMIf there are any beaten-down plunger companies, they'd probably be a good buy now, with all the campaign rallies coming up in the next two and a half weeks.
Posted by Rand Simberg at 02:38 PMThe new littoral ship that Lockheed Martin is building for the Navy is four percent overweight:
The Navy and Lockheed already have a plan to remove nearly all the additional weight from the ship over a period of about six months once the new ship, which is named Freedom, gets to Norfolk, Virginia, in December, said the sources, who asked not to be identified.
As I said, margin, margin, margin. If you miss your weight target by that much on a launch system, it's bye-bye payload. In this case, it simply puts the ship at risk in combat.
As the emailer who sent this to me asks, "I wonder if Lockheed will remove excess weight from Orion at no additional cost."
Posted by Rand Simberg at 10:46 AMI fully agree with Iain Murray:
While conservatives are angry about a number of things at the moment, they should be at least as angry that the Congressional Democrats who helped stoke the mortgage crisis are getting away with blaming everyone else for it. Today, Senator Chris Dodd, the prime recipient of GSE lobbying funds and proud holder of a sweetheart mortgage from Countrywide, is holding hearings where the witnesses will blame everyone but Dodd, Barney Frank and their cronies. Republicans asked to invite witnesses but were barred from doing so.
The notion that this mess is the fault of Republicans, and "deregulation" and the free market, is one of the biggest frauds ever perpetrated on the American people. And as a result, we could be heading toward both electoral and economic disaster.
[Update early afternoon]
Peter Schiff says don't blame capitalism:
Just as prices in a free market are set by supply and demand, financial and real estate markets are governed by the opposing tension between greed and fear. Everyone wants to make money, but everyone is also afraid of losing what he has. Although few would ascribe their desire for prosperity to greed, it is simply a rose by another name. Greed is the elemental motivation for the economic risk-taking and hard work that are essential to a vibrant economy.
But over the past generation, government has removed the necessary counterbalance of fear from the equation. Policies enacted by the Federal Reserve, the Federal Housing Administration, Fannie Mae and Freddie Mac (which were always government entities in disguise), and others created advantages for home-buying and selling and removed disincentives for lending and borrowing. The result was a credit and real estate bubble that could only grow -- until it could grow no more.Prominent among these wrongheaded advantages are the mortgage interest tax deduction and the exemption of real estate capital gains from taxable income. These policies create unnatural demand for home purchases and a (tax-free) incentive to speculate in real estate.
Similarly, the FHA, Fannie and Freddie were created to encourage lending by allowing primary lenders to turn their long-term risk over to the government. Absent this implicit guarantee, lenders would probably have been much more conservative in approving borrowers and setting interest terms, and in requiring documentation of incomes and higher down payments. Market forces would have kept out unqualified buyers and prevented home-price appreciation from exceeding the growth in household income.
Read the whole thing.
I disagree, though that the solution is to take away the home-mortgage interest deduction and the capital gains break. It would be much better to restore the deduction for all interest (as it is for business, and was for individuals until the tax "reform" in 1986). It's not fair to have to pay tax on interest earned as income, but not be able to deduct interest paid.
Also, rather than treating houses preferentially, peg all capital gains taxes to inflation, to eliminate having to pay a tax when the actual value hadn't increased.
Posted by Rand Simberg at 08:48 AMHow many times is he going to let Obama get away with this bullshit that he's going to cut taxes for people who don't pay income taxes? He's done it twice now. It's a frickin' handout and redistribution. As I said, John McCain could win this election if he weren't John McCain.
Sounding a little better on spending cuts. Talking about ending ethanol subsidies and tariffs on sugar (writing off Iowa...). He should have point out how he was going to veto spending bills that Bush wouldn't (another missed opportunity). Another missed opportunity was to point out that while earmarks are small, it's how Congress logrolls other members on big spending bills.
[Update]
McCain is actually doing much better now. But he really should stop talking about the "overhead projector in Chicago." People like planetariums, and it makes him look clueless about science.
[Update]
McCain just pointed out that Obama's solution (increase taxes, restrict trade) was Hooverlike. This is good in two ways: it helps separate him from Republicans and it's true.
[Update]
McCain is on fire on health care. Obama seems to think that having an employer providing health care is a wonderful thing, and that everyone agrees on that. But McCain had a great (non?)-Freudian slip. He called his opponent "Senator Government."
[Update]
The discussion on Roe almost veered into a discussion on federalism. But not quite. But McCain went after him on his vote on the bill to allow failed aborted babies to die. And Obama is obfuscating on his vote.
[Final update]
Not a great debate for McCain, but it was his best. And he's not out of it.
What was missing? Gun control. It would have been a big issue in key states.
Posted by Rand Simberg at 06:31 PMHere's a useful explanation of financial markets and the current crisis.
Posted by Rand Simberg at 08:46 AMOil closed below eighty bucks today. Which was inevitable.
[Wednesday morning update]
Below seventy two dollars this morning. That's going to put a crimp on Chavez' and Ahmadinejad's murderous ambitions.
Posted by Rand Simberg at 02:54 PMJohn Jurist writes (or at least implies) that there's just too much competition in the suborbital market:
An approach I favor is forming a university consortium analogous to those that design, build, and operate large cooperative research assets, such as telescopes and particle colliders. That consortium could develop a suborbital RLV or even a nanosat launcher to be used by consortium members for academic projects. Since the consortium would design and develop the vehicles, participating universities would be more likely to use them for student research under some type of cost-sharing arrangement with federal granting agencies.Dr. Steve Harrington proposed something a bit different recently:
If you took all the money invested in alt.space projects in the last 20 years, and invested in one project, it could succeed. More underfunded projects are not what we need. The solution is for an investment and industry group to develop a business plan and get a consortium to build a vehicle. There is a lot of talent, and many people willing to work for reduced wages and invest some of their own company's capital. Whether it is a sounding rocket, suborbital tourist vehicle or an orbit capable rocket, the final concept and go/no go decision should be made by accountants, not engineers or dreamers (Ref. 8).I would concur with Dr. Harrington's final remark except I would expand the decision making group to include management and business experts nominated by the consortium members with whatever technical input they needed.
Yes, good idea. After all, we all know that it's a waste of resources to have (for example) two grocery stores within a few blocks of each other. They could dramatically reduce overhead and reduce costs and prices if they would just close one of the stores and combine forces. In order to assure continued premium customer service, they could just assemble a board of accountants, and finest management and business experts to ensure that the needs of the people are met.
In the case of the RLV development, the consortium could hire the best technical experts, and spend the appropriate amount of money up front, on trade studies and analyses, to make sure that they are designing just the right vehicle for the market, since it will be a significant investment, and the consortium will only have enough money to do one vehicle development. They will also have to make sure that it satisfies the requirements of all the users, since it will be the only available vehicle. This will further increase the up-front analysis and development costs, and it may possibly result in higher operational costs as well, but what can be done? It's too inefficient to have more than one competing system. As John's analysis points out, we simply can't afford it.
Posted by Rand Simberg at 07:49 AMI made a crack in comments the other day that the market was tanking in anticipation of an Obama election. Some may have taken it seriously, but it was a joke.
I do think that markets react to potential election outcomes in general, but in this case, I suspect that there are much deeper issues going on, and given that John McCain has shown himself to be (as he has confessed in the past) as clueless on the economy and economics as Barack Obama, there's probably not much street preference one way or the other. The folks in the pits are probably not even thinking about the election at this point.
While I'm not a conservative, I sure wish that there was at least one in the race, in terms of the economy.
Posted by Rand Simberg at 05:29 PMThere's going to be a press conference at 11:30 this morning to announce his return visit to ISS. Jeff Foust plans to live blog it.
[Afternoon update]
Here is the site for the live blogging. Unfortunately, he seems to be blogging it in lorem ipsum, and I've never learned to read that language. Maybe he'll have an English version up later.
Posted by Rand Simberg at 07:08 AMTom Sowell explains, as only he can:
Fannie Mae and Freddie Mac do not deserve to be bailed out, but neither do workers, families and businesses deserve to be put through the economic wringer by a collapse of credit markets, such as occurred during the Great Depression of the 1930s.
Neither do the voters deserve to be deceived on the eve of an election by the idea this is a failure of free markets that should be replaced by political micro-managing.
Nothing about this makes me more angry than the continued lies by the collectivists that this was a failure of the free market.
Posted by Rand Simberg at 06:49 AMI think that this isn't going to be an isolated case:
My husband's business is a canary in the coalmine. When tax policies are favorable to business, he hires more guys, buys more goods, etc. When he is taxed more heavily, he fires people, doesn't buy anything new, etc. Well, duh. So, at the mere thought of a President Obama, he has paid off his debt, canceled new spending, and jotted a list of whom to "let go."
The first of the guys will get the news tomorrow. And these are not minimum-wage earners. These are "rich" guys, making between $200,000 and $250,000 a year.
My husband will make sure that we're okay, money-wise, but he won't give himself a paycheck that will just be sent to Washington. He'll make sure that he's not in "rich guy" tax territory. So, he will not spend his money, not show a profit, and scale his workforce down to the bare minimum.Multiply this scenario across the country and you'll see the Obama effect: unemployment, recession, etc. No business owner will vote for this man, but many a "middle-class worker" will vote himself out of a job. Sad the Republican can't articulate this.
Unfortunately, the Republicans nominated the wrong candidate for that. Maybe the vice-presidential nominee can.
Posted by Rand Simberg at 01:40 PM...that John McCain should have kicked off on Friday by properly responding to Senator Obama's lies and demagoguery on the financial crisis. It's exactly what Fred Thompson would have done, but I fear that out of a misplaced sense of collegiality, McCain won't do it.
The problem is, that in his heart, McCain doesn't really believe in free markets, any more than his opponents do. He has an emotional stake in "honor" and "service" over profit, and it makes it tough for him (as Glenn said) to go for the jugular against the corrupt rent seekers and collectivists in Washington, of both parties. Instead, he placidly and pallidly aims for the capillary.
He really needs to read this. As he notes, the problem isn't capitalism. It's politicians.
Posted by Rand Simberg at 06:46 PMIn comments at the previous post on this subject, Karl Hallowell comments:
It's not government's job to suck up risk for a contractor. As I see it, if contractors really were giving their best cost estimates, then they're regularly overestimate prices not consistently underestimate them.
The other commenters who seem to think that designing a brand new UAV, or the first successful hit to kill missile (SRHIT/ERINT/PAC-3, not the dead end HOE), or an autonomous helicopter (all things I've been heavily involved with) is something that can and should be done on a fixed-price contract (after all, one bridge is like any other, right?) . . . it can maybe be done, but only if you're willing to let system development take a lot longer.I don't know who posted this, but it's unrealistic.
Let's give an example of how the real world works in salvaging ships on the high seas:
Salvage work has long been viewed as a form of legal piracy. The insurers of a disabled ship with valuable cargo will offer from 10 to 70 percent of the value of the ship and its cargo to anyone who can save it. If the salvage effort fails, they don't pay a dime. It's a risky business: As ships have gotten bigger and cargo more valuable, the expertise and resources required to mount a salvage effort have steadily increased. When a job went bad in 2004, Titan ended up with little more than the ship's bell as a souvenir. Around the company's headquarters in Fort Lauderdale, Florida, it's known as the $11.6 million bell.Exactly the scenario where it is claimed that fixed price contracts can't work. Huge risk, lots of uncertainty, time pressure. A similar example is oil well firefighters. As I see it, there's almost no circumstances when government needs to help the contractor with risk. The money, paid when the job is done right, does that. If it's not enough, then nobody takes the contract. Simple as that.
Yes. The reason that cost-plus contracts are preferred by government is that government, by its nature, has an aversion to profit. It's the same sort of economic ignorance that drives things like idiotic "anti-gouging" laws, and it results in the same false economy for the citizens and taxpayers.
The problem isn't that companies are unwilling to bid fixed price on high-tech ventures. The problem is that, in order to do so, they have to build enough profit into the bid to make it worth the risk. But the government views any profit over the standard one in cost-plus contracts (generally less than ten percent) as "obscene," and to allow a company to make more profit than that from a taxpayer-funded project is a "ripoff." So instead, they cap the profit, and reimburse costs, while also having to put into place an onerous oversight process, in terms of cost accounting and periodic customer reviews, that dramatically increases cost to the taxpayer, probably far beyond what they would be if they simply let it out fixed price and ignored the profit. I would argue that instead of the current model of cost-plus, lowest bidder, an acceptance of bid based on the technical merits of the proposal, history and quality of the bidding team, even if the bid cost is higher, will ultimately result in lower costs to the government (and taxpayer).
As I understand it, this is the battle that XCOR (hardly a risk-averse company, at least from a business standpoint) has been waging with NASA for years. XCOR wants to bid fixed price, and accept the risk (and the profits if they can hit their internal cost targets), while NASA wants them to be a cost-plus contractor, with all of the attendant increases in costs, and changes in corporate culture implied by that status.
This is the debate that will have to occur if John McCain wants to make any headway in his stated desire Friday night to get rid of cost-plus contracts. Unfortunately, he's not in a very good philosophical position to argue his case, because he's one of those economic simpletons in Washington who think that making money is ignoble, and that profits are evil, particularly when they're so high as to be "obscene."
Posted by Rand Simberg at 10:34 AMI keep hearing about shortages and lines in the south. The last time we had gas lines on any major scale was in the seventies, when oil prices were kept artificially low by federal fiat. Is that what's happening here? Are the "anti-gouging" laws keeping prices too low, and discouraging new supply? For instance, if you can't get any more for it in North Carolina than you can in Ohio, where's the incentive to spend the money to ship it in from there?
Can anyone in the areas where the lines are tell me?
Posted by Rand Simberg at 01:26 PMObama's plans would be pretty hard on us.
It's not surprising. He's never displayed any knowledge of, or interest in business. If anything, his attitude (and unfortunately, John McCain's as well) is that there is something ignoble about profits (hence his self-righteous preening about his choice of becoming a community organizer instead of "going to Wall Street").
Posted by Rand Simberg at 08:46 AMA very interesting essay by Roderick Long:
There's a popular historical legend that goes like this: Once upon a time (for this is how stories of this kind should begin), back in the 19th century, the United States economy was almost completely unregulated and laissez-faire. But then there arose a movement to subject business to regulatory restraint in the interests of workers and consumers, a movement that culminated in the presidencies of Wilson and the two Roosevelts.
This story comes in both left-wing and right-wing versions, depending on whether the government is seen as heroically rescuing the poor and weak from the rapacious clutches of unrestrained corporate power, or as unfairly imposing burdensome socialistic fetters on peaceful and productive enterprise. But both versions agree on the central narrative: a century of laissez-faire, followed by a flurry of anti-business legislation.Every part of this story is false.
Observant libertarians have long noted that in general, captains of industry are not capitalists (or to use Jonah Goldberg's (via whom I found his link) more accurate phrase, "free-market economists"--"capitalism" is a Marxist term), and never have been.
Posted by Rand Simberg at 08:05 AMNewt Gingrich says not so fast to Paulson's bailout plan. I particularly agree with this:
Four reform steps will have capital flowing with no government bureaucracy and no taxpayer burden.
First, suspend the mark-to-market rule which is insanely driving companies to unnecessary bankruptcy. If short selling can be suspended on 799 stocks (an arbitrary number and a warning of the rule by bureaucrats which is coming under the Paulson plan), the mark-to-market rule can be suspended for six months and then replaced with a more accurate three year rolling average mark-to-market.Second, repeal Sarbanes-Oxley. It failed with Freddy Mac. It failed with Fannie Mae. It failed with Bear Stearns. It failed with Lehman Brothers. It failed with AIG. It is crippling our entrepreneurial economy. I spent three days this week in Silicon Valley. Everyone agreed Sarbanes-Oxley was crippling the economy. One firm told me they would bring more than 20 companies public in the next year if the law was repealed. Its Sarbanes-Oxley's $3 million per startup annual accounting fee that is keeping these companies private.
Third, match our competitors in China and Singapore by going to a zero capital gains tax. Private capital will flood into Wall Street with zero capital gains and it will come at no cost to the taxpayer. Even if you believe in a static analytical model in which lower capital gains taxes mean lower revenues for the Treasury, a zero capital gains tax costs much less than the Paulson plan. And if you believe in a historic model (as I do), a zero capital gains tax would lead to a dramatic increase in federal revenue through a larger, more competitive and more prosperous economy.
Fourth, immediately pass an "all of the above" energy plan designed to bring home $500 billion of the $700 billion a year we are sending overseas. With that much energy income the American economy would boom and government revenues would grow.
Also, SOX was the disastrous result of the last time Congress decided that it had to "do something."
Posted by Rand Simberg at 01:28 PMJim Manzi has a good, albeit depressing, description of the financial crisis and its likely outcomes.
[Saturday morning update]
One bit in the piece that I found amusing (and a little depressing):
[They] Promulgated a temporary ban on naked shortselling for about 800 financial stocks (in related news, the new recommended medical practice when you discover that you have a fever is to smash the thermometer against the wall, since this makes the problem go away).
Yes, I don't think this was necessary, and it will probably have bad consequences.
Posted by Rand Simberg at 03:30 PMI've long thought that the resolution of most digital cameras has reached the point at which it's overkill, and there are a lot of other improvements that the camera needs. Unfortunately, the marketing people at Canon don't agree:
Canon engineers are being held back from developing new sensor technology by marketing departments in a "race for megapixels", claims an employee of the Japanese photography company.
The employee told Tech Digest that Canon have the technology to "blow the competition away" in terms of image sensors, but are instead being asked to focus on headline figures like the number of megapixels a camera has. When asked for his opinion on the Canon EOS 5D Mark II, which we covered this morning, the employee said:"I am hugely disappointed because once again Canon engineers are dictated by their marketing department and had to keep up with the megapixel race. They have the technology to blow the competition away by adapting the new 50D sensor tech in a full frame format and just easing off a little on the megapixels. Although no formal testing has been done on the new model yet, judging by the spec and technology used, it just seems to be as good or as bad as the competition - not beating them by a mile (which we used to)."
I'd rather have more speed and better S/N ratio myself.
There's an amusing discussion of this, and the perennial war between marketing and engineering, including examples from Dilbert, over at Free Republic.
Posted by Rand Simberg at 01:01 PMJoe Biden says that the financial crisis was caused by the Bush tax (rate) cuts.
Does someone besides Joe Biden want to explain that one to me?
At least he didn't blame Global Warming.
Posted by Rand Simberg at 12:13 PMThat's what John McCain is. One of the reasons it's hard to get enthused about him. I suspect that Palin might be a little better.
[Update a while later]
Both presidential candidates are completely economically incoherent.
No surprise, since they're both economic ignorami. Though in Obama's case it's worse, because he thinks that he understands economics, and much of what he knows for damned sure is wrong.
Posted by Rand Simberg at 08:57 AMSo says First Trust, about the current financial problems on the Street. For what it's worth.
Posted by Rand Simberg at 09:40 AMGeorge Will has more on economic ignorance:
The indignant student, who had first gone to Home Depot for a flashlight, says it "didn't try to rip us off." It was, however, out of flashlights. Ruth suggests that the reason Big Box had flashlights was that its prices were high. If prices were left at regular levels, the people who would have got the flashlights would have been those who got to the store first. With the higher prices, "someone who had candles at home decided to do without the flashlight and left it there for you on the shelf." Neither Home Depot nor the student who was angry at Big Box had benefited from Home Depot's price restraint.
Capitalism, Ruth reminds him, is a profit and loss system.Corfam--Du Pont's fake leather that made awful shoes in the 1960s--and the Edsel quickly vanished. But, Ruth notes, "the post office and ethanol subsidies and agricultural price supports and mediocre public schools live forever." They are insulated from market forces; they are created, in defiance of those forces, by government, which can disregard prices, which means disregarding the rational allocation of resources. To disrupt markets is to tamper with the unseen source of the harmony that is all around us.The spontaneous emergence of social cooperation--the emergence of a system vastly more complex, responsive and efficient than any government could organize--is not universally acknowledged or appreciated. It discomforts a certain political sensibility, the one that exaggerates the importance of government and the competence of the political class.
Yes, an exaggeration that is reinforced by the propaganda inculcated into people by government schools.
Posted by Rand Simberg at 02:08 PMGeorge Bush's announcement this morning that the administration was concerned about "gouging" reminded me of why I wish that we'd had better options in the last two elections (and still do). I expect that kind of nonsense from Democrats, but you'd think that someone who was supposedly a businessman would know better. Or perhaps he does, and is just pandering. I'm not sure which is worse.
Every time we have a natural disaster like this, this idiotic topic comes up, and we once again have to explain Econ 101 to the products of our public school system, probably in futility. This time, it's Rich Hailey's turn.
Here's what I wrote about it a three years ago, in the wake of Katrina.
[Update late morning]
Jeez, I thought that David Asman was smarter than that. Now he's telling Fox viewers to take pictures of stations with high gas prices so that they can be reported to authorities. It's hard for me to believe that Neal Cavuto would do that.
[Another update a minute or so later]
You know, I think that this is an explanation for socialism and collectivism's continuing grip on the public mind, despite its long history of unending failure. There's just something in human psychology to which it naturally appeals, and rationality just can't break through. It just "feels" unfair for prices to go up in an emergency, regardless of the demonstrably bad consequences of attempting to legislate them.
[Late afternoon update]
Shannon Love explains how the gas station business works:
I'll say it one more time for those who can't be bothered to actually ask someone who owns a gas station. Gas stations set prices for the gas they sell today based on the wholesale price of the gas they will have to buy to replace it. Get it? The price you pay for a gallon today is the cost of the gallon the station will have buy to replace the one you just bought.
Gas stations sell gas at or near cost, so if they did not use replacement pricing any sudden spike in gas prices would shut them down and you couldn't get any gas. I simply do not know why our public and private talking heads cannot understand and communicate this simple fact.
Because either they don't know it, or they think that people don't want to hear it. They operate on razor-thin margins, and can't afford to hand out subsidized gas as charity, even if that wouldn't screw up the market. And note, for those who say it's "big oil" that is "maximizing profits" in the face of a national emergency, even if that were true (it's not) "big oil" isn't threatened with jail for "gouging." It's the gas station owner, who has no control over his wholesale gas costs. So people who demand that we crack down on gougers are essentially demanding that the station operators either operate at a loss, or pay fines, or go to jail. I don't know why anyone would want to be in that business in the face of so much public ignorance about it.
Posted by Rand Simberg at 07:47 AMEngineer's salaries, taking into consideration education and responsibilities, the stress of accelerated delivery schedules and their direct impact on corporate profits and overall success of the company, seem absolutely inadequate.
Well, I've known a few who were. But no, not in general.
In many of these overpaid professions, there's some kind of government-induced market failure going on (e.g., longshoremen), but in a lot of cases, it's just the occasional irrationality of the market place.
Posted by Rand Simberg at 08:10 AMHow much should Microsoft fear Google Chrome?
Who knows? We'll see.
Posted by Rand Simberg at 04:49 PMJohn Tierney on lunar and martian property rights.
Posted by Rand Simberg at 04:57 PMBut it sounds like a business setback for XCOR:
If the demonstrations in Oshkosh and Burns Flat were meant as a fly-off, the Armadillo team - led by millionaire video-game programmer John Carmack - came away as the winner.
"The Armadillo engine is going to be the primary engine for the Rocket Racing League," Whitelaw told me. He said five more planes will be built using Armadillo's propulsion system, which is a spin-off from Carmack's years-long quest to win the $2 million, NASA-backed Northrop Grumman Lunar Lander Challenge.
It sounds like the Armadillo engine has more thrust, though it's not clear how the T/W compares.
I wonder to what degree XCOR was constrained by a potential desire to maintain some legacy toward the Lynx engine? If they were building an engine purely for the RRL, would it have been a different design and fuel type?
Presumably, the business plan with which they raised their recent institutional investment considered this as a contingency. I'm sure they would have liked continuing business from RRL, though Whitelaw doesn't seem to rule it out for the future.
Posted by Rand Simberg at 01:54 PMGustav is looking like it's going to be bad news for the upper Gulf Coast:
As long as Gustav is over water, it will intensify. Gustav is currently under moderate wind shear (15 knots) . This shear is expected to remain in the low to moderate range (0-15 knots) for the remainder of the week. Gustav is over the highest heat content waters in the Atlantic. Given these two factors, intensification is likely whenever the storm is over water, at least 50 miles from land. Expect the high mountains of Hispaniola to take a toll on Gustav. Recall in 2006 that Hurricane Ernesto hit the southwest tip of Haiti as a Category 1 hurricane with 75 mph winds. Haiti's mountains knocked Ernesto down to a tropical storm with 50 mph winds, which decreased further to 40 mph when the storm crossed over into Cuba. Expect at least a 25 mph decrease in Gustav's winds by Wednesday, after it encounters Haiti. Further weakening is likely if the storm passes close to or over Cuba. By Wednesday, Gustav will be underneath an upper-level anticyclone. These upper atmosphere high pressure systems can greatly intensify a tropical storm, since the clockwise flow of air at the top of the storm acts to efficiently vent away air pulled aloft by the storm's heavy thunderstorms. With high oceanic heat content also present in the waters off western Cuba, the potential for rapid intensification exists should the center stay more than 50 miles from the Cuban coast. Once in the Gulf of Mexico, Gustav is likely to intensify into a major Category 3 or higher storm. I give a 60% chance that Gustav will cause significant disruption to the oil and gas industry in the Gulf.
This will roil the energy markets (it may be doing so already). It may also be a test, and an opportunity, for Governor Jindal to show that the people of Louisiana were wise to replace his predecessor with him after her Katrina fiasco, which was largely overlooked by the media in their lust to bash George Bush.
Posted by Rand Simberg at 09:17 AMLileks explains why I rarely go to Subway.
I'd won a free 6" sub. This was timely, since I was planning to buy one for my wife. We finished our meal; I went back to the place where the Sandwich Artists labor in various degrees of surly disinterest, and presented the coupon. The Artist began to craft the meal out the chopped and processed carbclay arrayed before him - and that's when the manager walked over.
"For future reference," she said, "those are for the next visit."I pointed to the small print on the back of the ticket. "Actually, it says for your next order."
"Well, it means visit. It's how we keep track of them in the back." She jerked a thumb towards the back of the store, where the Something wet and spiny sat in a crate, swallowing souls and dreams and crapping out rules and procedure.
If there are two things I don't like, it's someone who tells me that fine print doesn't mean what it says, and alludes to some company process that makes things simpler not for me, or for the employees, but some theoretical person on whose behalf the system was set in place years ago by a team of consultants who have already moved on to rejiggering something else that worked perfectly fine. On the other hand, after years of dealing with restaurant employees who couldn't give a fig about the job, it's difficult to carp when you find someone who does - unless, of course, that person has decided to make a point about a free sandwich for future reference.
Also, a trip to the museum.
Posted by Rand Simberg at 06:29 AMFrom George Will. I'm kind of intrigued by the idea of capping the pay of fascist CEOs (Lee Iacocca comes to mind as a poster boy).
Posted by Rand Simberg at 08:24 AMXCOR has attracted the funding of an institutional investor. It's not just angels any more.
Posted by Rand Simberg at 07:52 AMWhy the oil "shortage" is made in Washington.
Posted by Rand Simberg at 10:25 AMSort of.
When I had the privilege of paying American an extra fifteen bucks to check my bag today, I had no idea how much extra service they'd be rendering. Apparently, with this new program, they've come up with an innovative new luggage-handling process that enables them to expeditiously lose your suitcase on a non-stop. And it only took me an hour and a half after the wheels touched down to discover this new capability.
When I got to the carousel that was supposed to be for my flight, it was full of luggage from not one, not two, not three, but four different Dallas flights, as evidenced by inspection of the tags. Apparently, another innovation that the airline has come up with is to get the luggage to the airport before the passengers arrive, and then helpfully leave it all on the carousel, so that the few bags from your own flight from Fort Lauderdale won't feel lonely and ostracized, and can fit in better with the crowd. Or perhaps the aircraft simply arrived in LAX sans occupants, the latter having somehow been spirited away en route by Bushco to be shipped off to Gitmo for the ritual waterboarding and holy book defilation, with the airline complicit in both the act and the cover up.
I reported the miscreant item to the baggage service.
"Did you look at the bags we have outside the door here"?
No, that hadn't occurred to me, because I lacked the imagination to conceive that a bag would be removed from the carousel by the authorities with hundreds still milling around seeking their luggage.
"Let's go over and look."
We go back over to the carousel.
"Sometimes it might have a Dallas tag on it, because it might have gotten rerouted."
This, as there remained hundreds of Dallas arrivals on the swirling machine, whose contents I had now seen several dozen times.
I marveled at an airline that could get a bag rerouted through Dallas and somehow end up there at the same time as I, who took a non-stop from Florida. Does the luggage get to skip the layover?
Bottom line: I am now the proud owner of a receipt that informs me that in the event they locate the missing suitcase, it will be delivered to my room. So I am here for a business meeting in the morning with no clothing except that on my back. Well, OK, and my keister. And, yeah, my feet. But still.
I have to say that I agree with the sentiment.
[Update on early Monday morning]
Well, when I check the web site to track it, it seems to have shown up overnight. It's supposed to be delivered sometime this morning to my hotel. No word on where it had been sequestered. I was kind of wondering if someone else took it off the carousel. They're not bothering to verify tags any more at LAX, as they did in the olden days.
Posted by Rand Simberg at 07:34 PMJim Manzi explains it to Barack Obama. Unfortunately, both presidential candidates are economic ignorami.
Posted by Rand Simberg at 10:31 AMAlan Boyle has the story of yesterday's demo in Oshkosh.
Posted by Rand Simberg at 05:48 AMIs it almost over? Let's hope so.
Posted by Rand Simberg at 07:30 AMWhite Knight Two will be rolled out for the general public today in Mojave. Scaled Employees had a private rollout yesterday.
[Late morning update]
Clark Lindsey has the Virgin press release.
I don't understand why they say that this is environmentally friendly. Compared to what? If they're still going with the hybrid, it presumably burns rubber, and has CO2 as a combustion by-product. What's so friendly about that, compared to, say, LOX/kerosene? Just marketing hype, I guess.
[Update mid afternoon]
Clark Lindsey has a lot more links.
Posted by Rand Simberg at 07:18 AMSome interesting thoughts on the insane notion of banning it to save the planet. Also, comments about law students' economic literacy.
Posted by Rand Simberg at 07:08 AMMaybe. These were clearly unsustainable prices--the only question was how long it would take them to drop. And what do you know? The market works:
Gas may be getting just a bit cheaper, but major changes in how Americans live and drive are already in motion.
Car buyers have been fleeing to more fuel-efficient models. U.S. sales of pickups and sport utility vehicles are down nearly 18 percent this year through June, while sales of small cars are up more than 10 percent.While slashing production of more-profitable trucks and SUVs, automakers have been scurrying to build their most fuel-efficient models faster.
Toyota Motor Corp., which hasn't been able to keep up with demand for its 46-miles-per-gallon Prius hybrid, said last week it will start producing the Prius in the U.S. and suspend truck and SUV production to meet changing consumer demands.
Ford Motor Co. and General Motors Corp. also have announced plans to increase small car production, and GM has said 18 of the 19 vehicles it is launching between now and 2010 are cars or crossovers.
And what do you know, they didn't do it because their intellectual superiors in Congress passed a law making them. They did it because gas was four bucks a gallon. Maybe people aren't the stupid sheep that technocrats think they are.
Posted by Rand Simberg at 06:24 AMI know what you're saying -- "who invited the fat chick to the Twister party?" Certainly, all of us (with the possible exception of Randy) wish she wasn't here. But it's important to remember that fat chicks are often an important source of party supplies, and we must take the good with the bad. In the same way, Fannie Mae supplies the critical financial weed and beer to keep our national economic party going.
The numbers are complex, but let me boil it down for the economic layperson. Fannie Mae is a government company type thing that has a large pile of money, which I will call "A". The first thing it does is create $20 million bonuses for high performance executives like Franklin Raines, James Johnson and Jamie Gorelick, which I will call "B." Next, it allocates an amount "C" to lobbyists to make sure important Congressmen always get a thoughtful holiday card from Fannie Mae. After subtracting B and C from A, they are left with D, which is lent to homebuyers. These homebuyers then pay back the amount E, which, when subtracted from D, leaves F, the amount Congress has to come up with. In order to keep this important financial system humming along at peak efficiency, it is necessary that you, the taxpayer, are F'ed.
RTWT, and save the Dave!
Posted by Rand Simberg at 06:37 AMThe Dems are finally starting to come to their senses about energy production, but not quite:
One idea floated by Reid would require that whatever oil is drilled in newly opened areas would need to be sold in the United States.
This is pure, unadulterated economic ignorance. Senator Reid, go to the board and write one hundred times, "OIL IS FUNGIBLE." WTF difference does it make where the oil is sold? The important thing is to get it on the market. If we are pulling new oil off the north slope, it might make sense to ship it to Japan, improving our balance of trade with them, and relieving them of the cost of shipping it all the way from the Persian Gulf. It might in fact make sense to simply ship new oil from the Gulf of Mexico to Gulf refineries, but that should be a market decision, not an arbitrary and idiotic political one. "Energy independence" is an economic myth.
And then, we have this:
Democrats also want any compromise plan to include investments in clean and renewable energies, a crackdown on oil speculators and proof that the oil and gas companies are fully utilizing land that is already leased for exploration.
What does a "crackdown on oil speculators" mean? It's called a futures market, and a lot of people play. It serves a function of reducing risk for many in the industry. "Speculation" is simply a dirty word for "investment." This new scheme where people can buy gasoline ahead of time at a fixed price? That's speculation, folks.
And this:
"If they were showing in good faith that they were drilling on some of the 68 million acres they have now, it might change some of our attitudes," said Sen. Claire McCaskill (D-Mo.).
So, in order to get access to leases with high potential, they have to waste their money drilling on leases with low potential? Brilliant.
The only way to change the attitudes of people like this is Economics 101. And I doubt if even that would help.
Posted by Rand Simberg at 10:44 AMThat's the recursive bit of wisdom that Douglas Hofstadter came up with, that goes "It always takes longer than you expect, even when you take into account Hofstadter's Law."
Jeff Foust has a good example of it today, as he examines the state of the suborbital industry. It looks now like no one is likely to enter commercial service prior to 2010, unless Armadillo can make it. Which brings up a little problem.
When the Commercial Space Launch Amendments Act (CSLAA) was passed in 2004, the industry got regulatory relief for eight years--until 2012--in which FAA-AST would not regulate the vehicles with respect to passenger safety, as long as there were no accidents involving passenger loss. This was in recognition of the fact that a) the agency didn't really know how to do that and b) if it attempted to do so, the industry might be still born as a result of a costly and time-consuming regulatory overburden. The eight-year period was provided to allow the companies time to develop and test vehicle design and operational concepts, with informed consent of the passengers, that would provide a basis for the development of such regulations as the industry matured (as occurred in the aviation industry in the twenties and thirties). In light of the SS1 flight in fall of that year, there was an expectation that there would be other vehicles flying in another two or three years (as Jeff notes--Virgin was predicting revenue service in 2007), which would have provided a five-year period for this purpose.
But if few, or none are flying until 2010, that leaves only two years before the FAA's regulatory power kicks in, which will be an insufficient amount of time to meet the intended objectives of the original maturing period.
Assuming that the logic still holds (and it certainly does for me, and I assume most of the industry and the Personal Spaceflight Federation) the most sensible thing to do would be to simply extend the period out to, say, 2018. Unfortunately (at least in regard to this issue), the most sensible thing is unlikely to happen.
In 2006, control of the Congress passed to the Democrats, which means that Jim Oberstar of Wisconsin took over as chairman of the relevant committee. He was opposed to the regulatory relief, railing against it as a "tombstone mentality" (whatever that means). He was unmoved by the argument that overregulating now would save passengers, but only at the cost of none of them ever getting to fly. Being in the minority at the time, he lost the battle, but now that he's in charge, it will be difficult, if not impossible, to get an extension from him. In fact, even an attempt to do so might result in losing it altogether if the issue is revisited under his jurisdiction.
For those hoping for what would seem to require a miracle--Republicans regaining control of at least the House, this would be one more reason to wish for that, if they're fans of this nascent industry. Either that, or at least hope that Oberstar (and his partner in dumbness, Vic Fazio) moves to a different committee.
[Afternoon update]
Not that it affects the point in any way, but as a commenter points out, I goofed above. Oberstar is from Minnesota. I could have sworn he was a Badger.
Posted by Rand Simberg at 07:32 AM...causation?
Maybe. The problem is, McCain is likely to be as bad in some ways, with all of his stupid talk about "obscene" profits.
Posted by Rand Simberg at 06:08 AMHas our oil consumption dropped to 2002 levels? We'll see what effect it has on the economy. It has to be hurting tourism.
[Late morning update]
Paul Dietz mentions Bob Zubrin's flex-fuel crusade in comments. It looks like both candidates may be on board with a mandate for this:
The really good news is that both Senators John McCain and Barak Obama have declared their support for the Open Fuel Standard that must be adopted to ensure that each of the roughly 17 million cars we buy in this country every year are Flexible Fuel Vehicles.Posted by Rand Simberg at 06:45 AM
Florida just bought 300 square miles of cane fields in the everglades to return them to wetlands. They paid $1.75 billion. That buys out US Sugar that was responsible for 10% of the US sugar lobby. In April, in response to one of Rand's posts, I wrote that we needed to find a way to buy out big sugar. For 6 MT times $0.10 implicit subsidy/lb, that's $1.2 billion/year. US Sugar's share of that is $120 million per year. So $1.75B is a pretty good price for their concession.
Sweet deal, Rand! Thanks for taking one for the team as a Floridian to lower sugar prices nationwide.
Posted by Sam Dinkin at 07:24 AMThere's an interesting article over at the NYT about the Pentagon's difficulty in getting good engineers, particularly systems engineers.
In short, the pay is too low, it's not seen as exciting as a lot of the other opportunities for new grads (e.g., Google, or other fields such as finance), programs take too long and are technologically obsolescent, and there's too much bureaucracy. Sounds kind of like the reasons I left fifteen years ago.
This was amazing to me, but I guess that after almost three decades in the business, it shouldn't be:
Their report scolded the Air Force as haphazardly handling, or simply ignoring, several basic systems-engineering steps: considering alternative concepts before plunging ahead with a program, setting clear performance goals for a new system and analyzing interactions between technologies. The task force identified several programs that, hobbled by poor engineering management, had run up billions of dollars in overruns while falling behind schedule.
I've seen this happen at NASA many times over the years, but that doesn't surprise me because space isn't important. National defense is, or at least should be. One wonders how to change the incentives in the system to get better performance. Part of the problem is that the services themselves, particularly the Air Force (with which I have the most experience) don't value procurement highly enough as a career path. It's a lot easier to become a general via the cockpit than it is through logistics or development. The other problem is that you often having young lieutenants and captains given responsibility for programs of a size far beyond what they'd be managing at a similar experience level in private industry. This is good from the standpoint of encouraging recruitment, but it often means that they lack the experience to handle the job, and even (or especially) when they're good, they may be promoted up and out of the program. That's one of the Aerospace Corporation's primary functions--to provide program support to the blue suits, and maintain an institutional memory to make up for the fluidity of personnel changes of the AF staff.
In theory, it's a big opportunity for people like me (I actually have a masters degree in aerospace program management), but it's hard to get consulting work as an individual due to arcane procurement rules. Also (though the article didn't mention it) it's a hassle to deal with a clearance, and I'm not in any rush to renew mine, though I'm starting to consider it, because I really do need the income. Blogging just isn't paying the bills.
Oh, one other thing. The description of the problems above bears a strong resemblance to a certain controversial large NASA project, where maintenance of the job base and pinching pennies seems to take precedence over actually accomplishing the goal. Or "closing the gap."
[Via Chicago Boyz]
Posted by Rand Simberg at 07:24 AMAnd where is it going, in commercial space?
I have to say, I thought this was pretty funny:
Virgin Galactic has already been watching its back with the EADS suborbital space plane (pictured above), set to make its first flight by 2012. But now there's cash across the pond. "We have invested substantial money into this project," Auque said without citing exact figures. "The problem is that we need to create this market."
I doubt very much that Virgin Galactic is worried that EADS Astrium is going to raise a billion dollars to build a suborbital tourist vehicle. There's a reason that Auque didn't cite "exact" (or even approximate) figures. He expects to do it mostly with someone else's money, if he can find a sucker (like ESA?).
Posted by Rand Simberg at 05:40 AMA commercial space wiki. I'll have to add it to the blogroll (even though, technically speaking, it's not a blog. But I don't have a wikiroll...).
Posted by Rand Simberg at 10:52 AMI have a new piece up over at Pajamas Media on space transportation and the Interstate Highway System.
Hey, it was Mike Griffin who made the analogy, not me.
I should also note that while the title is mine, the subheadline is theirs.
[Late afternoon update]
Only Mark Whittington would have the native talent to so misread this piece as to think that I was "expressing astonishment." Of course, it's not the first time that he's fantasized about my views.
[Another update]
Now Mark is fantasizing that I actually want, or expect NASA to build the Interstate to space.
Well, it's totally in character for him.
I sure wish he'd learn to read for comprehension.
Posted by Rand Simberg at 10:02 AM"Messrs. Obama and McCain both reveal a disturbing animus toward free markets and success."
Indeed.
Posted by Rand Simberg at 06:22 AMFor that kind of money, I'd expect Cat 8, at least.
An audiophile and his money are soon parted.
[Update a few minutes later]
As noted, the Amazon customer reviews are hilarious.
[Update in the evening]
Stephen Dawson (from Down Under) has a defense (albeit pretty flimsy. as he admits) of Denon.
I have to admit my disappointment as well. I'd always respected Denon up until this. As someone in comments said, one hopes that the marketing person responsible will have a few of these cables run through them from one end to the other. Or be keelhauled with them.
Posted by Rand Simberg at 12:29 PMAnother jump in oil prices.
Think it has anything to do with the fact that both presidential candidates favor a hidden tax on energy and oppose expanding domestic oil production?
You know, in the past, when I've said that prices in this range are not sustainable, I always assumed that, at least at some point, sanity would reign in Washington. What a dumb assumption.
[Thursday morning update]
Wise words from Lileks:
...there's hope. An article in the paper last week said that the gyrations in the oil market may indicate that the laws of supply and demand no longer apply. Well, clever us, to live in an age where immutable laws are abolished with ease; no doubt faster-than-light travel is now possible as well. Whenever someone says that the old laws no longer apply, it's a sure sign that the laws are about to reassert themselves with brutal force.
Three-buck gas by October? Likely.
As Carl notes in comments, even when you know you're in a bubble, you don't know when it's going to pop.
[Update a few minutes later]
Anyone wondering why U.S. energy policy is so dysfunctional need only review Congress's recent antics. Members have debated ideas ranging from suing OPEC to the Senate's carbon tax-and-regulation monstrosity, to a windfall profits tax on oil companies, to new punishments for "price gouging" - everything except expanding domestic energy supplies.
Amid $135 oil, it ought to be an easy, bipartisan victory to lift the political restrictions on energy exploration and production. Record-high fuel costs are hitting consumers and business like a huge tax increase. Yet the U.S. remains one of the only countries in the world that chooses as a matter of policy to lock up its natural resources. The Chinese think we're insane and self-destructive, while the Saudis laugh all the way to the bank.
And unfortunately, both presidential candidates are economic ignorami:
Recent weeks have seen some GOP stirrings on Capitol Hill, but John McCain has so far refused to jettison his green posturings, such as his belief in carbon caps and his animus against offshore development. A good reason for a rethink would be $4 gas. At present, it is charitable to call Mr. McCain's energy ideas incoherent, and it may cost him the election.
Of course, Obama's even worse, but even if McCain wins, it will be a lot closer than it need be. And prices will continue to soar. Needlessly.
Posted by Rand Simberg at 02:08 PMNo, even the premise was crazy:
While the premise of the 55mph speed limit was a perfectly valid one, the effectiveness of the rule was debatable. There is certainly no doubt that driving at a lower speed would consume less energy. The problem lies in the fact that the national 55mph speed limit was perhaps the most universally ignored law in history apart from prohibition.
Just what was it about the premise that was "valid"? That if everyone drove fifty five instead of seventy that it would save gas? Well, I guess. But so what? Why fifty five? Why not fifty? Why not forty five?
I have never seen any kind of quantitative analysis that provided a rationale for any particular speed limit (at least one designed to save gas and lives). What's magic about the double nickel? (In this regard, it is subject to the same reductio ad absurdum as the minimum wage). Hey, I have an idea that would save a lot of gasoline. Let's ban cars, motorcycles and trucks from the highways. Don't allow anything on them with an internal combustion engine. That would solve the problem. And it makes just as much sense as an arbitrary federal speed limit. The only difference is that the absurdity of the proposal is much more obvious.
Despite their lack of analysis, proponents also claimed that arbitrarily capping legal speeds at fifty five promoted "safety." The only rationale for this notion basically boiled down to "speed kills," which is a pithy phrase, marred only by the fact that it doesn't correspond to empirical reality. Even ignoring the very real fact that there was no significant increase in traffic fatalities after the idiotic law was repealed in the nineties (in fact, I think they went down), it doesn't take into account the fact that time is money. If truckers followed the law, it would add a day to a cross-country trip, which means a day's delay in the delivery of needed goods, and either more cost for the driver's time, if he's paid by the hour, or a cut in his profits if he's paid by the mile. If a long-distance commuter did so, it might add fifteen or twenty minutes each way. He might have to get up earlier, so the extra time spent behind the wheel might come out of sleep time, thus increasing the possibility of an accident due to drowsiness. Also, slower speed means longer trip times, which might mean driving later into the night to get to the same destination, again increasing the chance of drifting off.
At four dollars a gallon, if gas is really saved at fifty-five, there is plenty of incentive for individual people to slow down on their own, if it makes sense to do so overall. But they're in a position to make the trade off in a way that no legislator in Washington can ever be. We had a couple of decades in which to experiment with this foolish notion, and it was found wanting. Like Prohibition, let's leave it in the dustbin of history.
One other point. I remember when the Republicans won the Congress back in 1994. I had some hope that there would be at least some rollback from a lot of the statist nuttiness that had been accumulating since The New Deal and The Great Society. Those hopes were mostly forlorn, with the rare exception of welfare reform, and George Bush has put the final nails in the coffin of the Gingrich revolution. But one other rare exception was the repeal of the fifty-five speed limit. If that particular bit of idiocy is reinstated, I'll really feel that it was all for naught.
Posted by Rand Simberg at 11:16 AMAlan Boyle has a review of what looks to be an interesting book on SpaceShipOne
On entrepreneurial space, from Jeff Greason and Burton Lee.
And Clark has another news item, which is one of those have-to-laugh-so-you-don't-cry things:
After $10B+ in development costs, the Orion crews will land on the ground only by accident: NASA develops airbags for emergency on-shore CEV landings.
Sigh.
Posted by Rand Simberg at 12:47 PMJeff Foust has some reporting on Will Whitehorn's talk at ISDC yesterday. In this post, he notes that White Knight 2 will roll out on July 28th, presumably in Mojave, and discusses other potential applications than just a first stage for SpaceShipTwo, including a satellite launcher. The lack of comment other than "we've learned some lessons" on the SS2 propulsion is interesting to me. It sounds like they're still not sure what they're going to do, which continues to put SS2 schedule (whatever it is) in jeopardy. I suspect that Sir Richard's hype remains ahead of the actual program.
In this post Whitehorn mildly disses the Lynx:
XCOR is a company I respect, but with respect to them, they're not building a spaceship. They're building basically a high-altitude MiG equivalent. They're building something that you can strap in and go up to 37 miles. You won't get your astronaut wings but you will see the curvature of the earth. That will be an exciting project, but the problem is that it's not a space project, and I think it's been a little bit wrong to call it that.
While technically that's true, it is a project that can easily evolve into a "space project," which is what the program intent is. I don't see this as a problem. In fact, I see it as a solution, because Virgin may have bitten off more than it could chew with SS2. In hindsight (and foresight for some of us) it might have been useful to develop more operational experience with a lower-performance vehicle before moving to a bigger one.
Really, the only thing lacking from the XCOR product is a lack of astronaut wings--it will certainly be a space experience, and a more personal one with a better view, sitting in the left seat. I think that the market for it will be bigger than Whitehorn claims to think.
Posted by Rand Simberg at 05:02 AMClark Lindsey is live blogging, here and here.
Posted by Rand Simberg at 07:34 AMThe browser wars return.
This particularly caught my eye:
Firefox 3.0, for example, runs more than twice as fast as the previous version while using less memory, Mozilla says.
The browser is also smarter and maintains three months of a user's browsing history to try to predict what site he or she may want to visit. Typing the word "football" into the browser, for example, quickly generates a list of all the sites visited with "football" in the name or description.Firefox has named this new tool the "awesome bar" and says it could replace the need for people to maintain long and messy lists of bookmarks. It will also personalize the browser for an individual user.
"Sitting at somebody else's computer and using their browser is going to become a very awkward experience," said Mitchell Baker, chairwoman of the Mozilla Foundation.
Sounds like a market opportunity to me. I have a few ideas about how to solve it.
Posted by Rand Simberg at 05:08 PMApparently, things are starting to get more serious over there, though the EADS/Astrium concept remains a bad joke. Rob Coppinger has a roundup from across the pond.
Posted by Rand Simberg at 06:24 AMAn FAQ. All of the campaigns should read it, though I suspect the very concept is anathema to both Senators Clinton and Obama.
Posted by Rand Simberg at 06:29 AMYou know, if you really need these job interview tips, they probably won't do you much good, because even if you follow them, you're likely to do something equally or more stupid.
Posted by Rand Simberg at 03:51 PMFrom George Will:
You say that even if global warming turns out to be no crisis (the World Meteorological Organization says global temperatures have not risen in a decade), even unnecessary measures taken to combat it will be beneficial because "then all we've done is give our kids a cleaner world." But what of the trillions of dollars those measures will cost in direct expenditures and diminished economic growth--hence diminished medical research, cultural investment, etc.? Given that Earth is always warming or cooling, what is its proper temperature, and how do you know?
You propose a "cap and trade" system to limit the carbon dioxide that many companies can emit. Is not your idea an energy- rationing proposal akin to Bill Clinton's BTU tax?
He has more, not related to climate change.
Also, a long paper on the futility of trading hot air.
Posted by Rand Simberg at 02:41 PMRob Coppinger has some thoughts on SpaceShipOnePointFive.
I suspect that Alex, and perhaps Sir Richard, are now regretting their decision to not take advantage of the bird in the hand, holding out for the flock in the bush. They probably (in fact, almost certainly) didn't anticipate the development problems they'd have with the propulsion system, though they were warned. I suspect that they (like Burt) drank too much of the hybrid koolaid, and were lulled into complacency by the success and (apparent, though this was an illusion) safety of the SpaceShipOne engine.
As for the comment that a passenger wouldn't have paid the costs of the flights, I don't buy it. They could have charged much more than a couple hundred thousand for the first several, perhaps even few dozen, flights. But we'll never know.
Posted by Rand Simberg at 06:52 AMIs it approaching? A nickel a kW-hr would be pretty hard to beat.
Like Phil Bowermaster, this kind of thing is why I don't lose much sleep over peak oil.
[Update a few minutes later]
A lot of comments on the subject over at Randall Parker's place.
Posted by Rand Simberg at 08:05 AMThere's an interesting discussion in comments over at Selenian Boondocks on the value of microgravity processing (that veers into other subjects, such as utility and value of propellant depots). I think that Jon gets the better part of the argument, and that "Googaw" is overreacting to overhype. Not to mention ignorant of orbital mechanics. As Jon says, I don't think that he's thought through the concept of a propellant depot in GTO.
Posted by Rand Simberg at 10:01 AMHas the dollar hit the bottom?
Given that the Fed is signaling no more rate cuts, I think that it's a pretty good bet. Which means that it's also a peak for oil prices (at least if they remain denominated in dollars). And (more) bad news for the Dems in the fall.
Posted by Rand Simberg at 07:11 PMThere's a long piece on the the current state of space law over at the ABA Journal. I only have a couple issues with it. First, I don't know what they mean by this:
Even though the United States eventually outpaced the Soviet Union by putting men on the moon in 1969, the space race continued until the early 1990s.
No, the space race was essentially over by 1968 or so, once the Russians realized that they weren't going to beat us to the moon, and instead rewrote history to pretend that they'd never even been trying. There was no urgency or racing after that--had there been, NASA budgets would have been higher, and schedules faster. So I don't know what this sentence means, unless it just a vague reference to the fact that progress, such as it was, continue on both the US and Soviet side, until the fall of the Soviet Union.
On ITAR, I strongly disagree with Pam Meridith:
"I think the hysteria over ITARs is out of proportion," says Pamela L. Meredith, who co-chairs the space law practice group at Zuckert, Scoutt & RasenÂberger in Washington, D.C. "They've been around for a long time now, so people have had time to adjust."
No matter how much "time people have to adjust," it still adds time and cost to projects, and prevents many from happening altogether. And it has a disproportionate effect--like most regulations, big space businesses (who despite leftist mythology, are no fans of capitalism or free enterprise) don't necessarily dislike ITAR, because they can afford to meet the requirements, and they represent a barrier to entry to smaller businesses and newcomers, who generally can't. (Though there's also no question that it's cost Boeing a lot of satellite business.) And as a perfect case in point, consider Mike Gold at Bigelow (in a long, but quite interesting interview):
Res Communis: Can you comment on a company's cost of implementing ITAR?
Gold: Yes, absolutely. Paying so much for export control is a bit like being asked not just to dig your own grave, but to jump in it as well. Our best estimates are that we pay roughly $130.00 per hour, per person, for every hour that a government official monitors us or reviews our documentation during the day, plus overtime, which can add up on overseas trips. What amazes me is that when we travel to Russia for meetings, we sometimes travel with not one, but two government officials, monitoring every word we say. Then, across the table from us are the Russians, all great folks, who came out of a Communist system, and they have no explicit monitors. If we were to have brought someone down from Mars to attend our meetings, and asked them which of these two nations represented the free country, the Martian would point to the Russians. The U.S. holds itself out as the bastion of freedom. But when I am sitting there at those meetings I have to wonder: which is the free country? Now again, this is a problem of policy not personnel. The monitors we get are often good, smart people, who can even be quite helpful at times. However, what I want is for these monitors to be able to spend their limited time and resources focusing on military sensitive technologies that really matter rather than wasting their efforts on us. The Russians basically do this. They have the unique policy of protecting information that is actually sensitive. They don't care about metal coffee tables. It makes a lot more sense. And, in regard to the financial costs, you know, the KGB may have spied on you back in the Soviet days, but at least they had the courtesy to do it for free. It is unfathomable to me what we have to pay for export control review and monitoring.Res Communis: You do cover their travel expenses also?
Gold: Absolutely, including airfare and hotel. Specifically, in 2006, the year of the Genesis I campaign, we paid over $160,000 in monitoring fees alone. In 2007, when the Genesis II launch campaign took place, we paid the government nearly $150,000 for monitoring and reviews. Thanks to Mr. Bigelow's generosity and commitment, we're able to afford such fees, but there are a lot of small companies that can't. This is why the ITAR has stifled innovation and stunted development in the American aerospace sector. The ITAR should be re-named "The Full Employment for European and Foreign Aerospace Workers Act."
Res Communis: As between a new space company like Bigelow and the big aerospace corporations, is the ITAR burden disproportionate for the new companies?
Gold: Everyone has problems with it, but a large, well established company is better able to absorb the expenses and can pass the cost on to their customers relatively easily. Anecdotally, I have spoken to a number of friends and colleagues at small aerospace businesses and start-ups. They tell me that they don't even look at international collaboration because they know they can't afford to work through the export control problems without a hoard of attorneys. Frankly, it took a lot of work and diligence and a little bit of luck on our own part to have been able to survive the ITAR gauntlet with just myself, my deputy, and some limited support from outside counsel.
And because Bigelow is wealthy, and willing to foot the bill, he can afford it. Most startups aren't in this position. This is just one of the many ways that federal policy has been disastrous, and continues to help bind us to the planet.
Posted by Rand Simberg at 08:36 AM...I don't use Microsoft Server software.
Why would anyone use Microsoft on their server? I can understand the desktop, for naive users, who also use the crap at home, but on a server?
Posted by Rand Simberg at 03:47 PMDavid Freddoso is still angry about our insane and, in my opinion, criminal ethanol and sugar policies:
The problem is that our sugar industry has even better lobbyists than big ethanol. They enjoy price supports, which we pay for both through the Treasury and in the supermarket. The price of our sugar is usually twice that of the world market. The sugar growers love it -- even if they cannot sell all of their sugar, they have a guaranteed government buyer at an inflated price. The corn growers love it too, because high U.S. sugar prices push our food industries to use high-fructose corn syrup (ever seen that on a product label?) as an alternative sweetener -- yet another artificial support for the world price of corn.
Not to mention wreaking havoc on the Everglades. Price-supported sugar cane is using up a lot of the water that both south Floridian humans and animals need, and they do this with the same political clout that they use to get the subsidies and tariffs, for an industry that is not all that big in terms of the economy.
Even if we want ethanol, we can't solve the problem by importing sugar, because there are tariffs in place. We can't import the ethanol itself because there's a high tariff against that, too. Wherever you turn, there's no way out -- Americans don't enjoy economic freedom, we live in a managed economy.
It makes me especially proud of my country when I see Sen. Chuck Grassley (R-Iowa) call foreign delegates' concerns over a potential doubling of world hunger "a joke..."
Let's call these people out for what they are--Republicans and Democrats alike--fascists. Not that there's anything wrong with that.
[Update a few minutes later]
[Update early evening]
Oh, wonderful:
Key House and Senate farm bill negotiators reached agreement today on the main elements of the farm bill...[T]he five-year bill would raise the target prices and loan rates for northern crops beginning in 2010, raise the sugar loan rate three-quarters of a cent and include a sugar-to-ethanol program.
Oh, that's just great. We have a program that makes us overpay for sugar, and now we're going to start a new program to subsidize the ethanol we create from it -- because without the subsidy, the inflated sugar price we've created will make the ethanol unprofitable.
Just when you think it can't get any worse, they always find a way.
Posted by Rand Simberg at 09:19 AMAlan Boyle has more info on this morning's press announcement from the Rocket Racing League. It looks like they haven't necessarily dropped XCOR as a supplier (as I previously speculated--note that there is a comment in that post, ostensibly from someone from the RRL, saying it was good news for everyone), but are looking for more competition for propulsion, so now they'll have a kerosene engine from XCOR and an alcohol engine from Armadillo. If they can spread the wealth and expand the industrial base for these technologies, that's all to the good.
And this should gladden the hearts of LLC competitors:
Carmack recently said he would make rocket engines available to customers at a cost of $500,000 apiece. He declined to say exactly how much the racing league was paying Armadillo for the current project - but he said the project had a higher priority than Armadillo's renewed push to win the NASA-funded Lunar Lander Challenge.
That could conceivably mean that they won't even bother, and will leave the money on the table for someone else, but even if they compete this year, their chances of winning will be reduced if they're not focused on it, so it could represent an opportunity for Masten, Unreasonable Rocket, and others.
Anyway, I'm glad to see this industry finally (literally) getting off the ground. I wrote a paper at STAIF ten years ago that we needed a racing industry to push the technology, just as occurred in the auto (and air) racing business. A lot of people at the session in which I presented it were skeptical at the time, but it looks like my vision is finally coming to fruition.
[Mid-morning update]
Here's another pre-press-conference report from the New York Times.
[Update a couple minutes later]
Clark Lindsey live blogged the press conference via call-in. I don't see any mention of XCOR.
Posted by Rand Simberg at 06:18 AMThomas James has a question that I've often wondered about as well:
I have to wonder, has every project I have ever worked on with LM (X-33, VentureStar, ET, CEV/Orion, among others) started from scratch with everything from numbering schemes to release processes to configuration management to data vaulting to drawing formats and standards to basic skill mix and team structures? You'd think that after so many decades that a lot of this stuff would have become routine by now -- revised periodically as new technology becomes available, of course, but not built anew every time.
A counter argument to this -- and one I used frequently when confronted with the All-Encompassing Michoud Excuse for Not Improving Processes: "That's the way ET does it" -- is that one ought to take advantage of the start of a new program to incorporate the lessons learned from other programs, thereby continuously improving the way business is done. Unfortunately, there doesn't seem to be a middle ground between status quo and Year Zero when it comes to these things.
Every time we used to do a proposal at Rockwell/Boeing, and have to describe the systems engineering process, it seemed like we had to come with a new process flow description and graphic, as though we'd never done this before, instead of taking an existing one and tweaking it, and this applied all across the board--in risk mitigation and management, trade analyses, etc.
If I were running one of these multi-billion dollar corporations, I'd put someone in charge of boilerplate and legacy, so that there was a one-stop shop of best practices and material for use in both proposing and managing programs. Maybe they have one, and I was always unaware of it, but if that's the case, that's a big problem as well.
Posted by Rand Simberg at 05:55 AMApparently Aerojet is getting into the responsive reusable engine business (albeit with Air Force funding). I think that's great, but I have to wonder if the reporter has been paying attention to what has been going on in the industry:
The last US-designed and produced hydrocarbon engine was the Rocketdyne RS-27, based on 1960s technology and now out of production.
There may be some qualifying adjectives that would make that statement true (of thrust greater than X? Used in an orbital launch system?), but folks like XCOR and Armadillo, and Masten, and several contenders for the LLC would be surprised to learn that they haven't been designing and producing hydrocarbon engines for the past few years.
Posted by Rand Simberg at 05:15 AMThe Rocket Racing League is going to make a press announcement on Monday, but the release raises some questions:
Rocket Racing League Composites Corp. will announce the acquisition of a leading aircraft manufacturer and a partnership with a leading engine manufacturer...
...WHO:
Granger Whitelaw, CEO, Rocket Racing League
Peter Diamandis, Co-Founder, Rocket Racing League
Adam Smith, Vice President, EAA
Len Fox, Test Pilot, Rocket Racing Composites Corp.
Scott Baker, President, Velocity Aircraft
Neil Milburn, Armadillo Aerospace
John Carmack, Armadillo Aerospace
We have a missing player, and a new player. XCOR was building the initial racers, but they don't seem to be represented at the event. And this is the first time that I've heard Armadillo associated with the project. So apparently, for whatever reason, Armadillo is now providing propulsion for the racers, and they're apparently acquiring an aircraft manufacturer (Velocity?). I wonder why they have to acquire Velocity. Can't they just buy modified aircraft? Or maybe they're being imprecise in language, and it's also a partner?
This obviously raises many questions, none of which I know the answers to, but it would seem to be bad news (though of course by no means fatal) for XCOR. It certainly won't affect their work on the Lynx. It's also good news for Armadillo, and it means a new customer with apparent confidence in their hardware, even after the engine problems at the cup last October.
Perhaps the questions will be answered at the press conference, if asked.
[Update a few minutes later]
Actually, on reconsideration, it's not even obvious that it is bad news for XCOR (though clearly John Carmack must think that it's good for Armadillo, or he wouldn't have done the deal). It could be that, now that they're trying to focus on developing a true suborbital vehicle, the RRL work was proving to be a distraction for them that they've now gotten out from under. But it's speculation on my part, either way.
Posted by Rand Simberg at 06:07 PMI mentioned yesterday that, in addition to hawking rockets, John Carmack had an assessment of the state of the industry and his competition. If you didn't read it, it's well worth a read, and I largely agree with it. Just a few quibbles:
Scaled / Virgin is the safest bet for success. Outside of the X-15, Space Ship One is the only example of a reusable, 100km class manned vehicle. Everyone else, us included, requires a lot more extrapolation for an investor to believe in, and the problem isn't nearly as trivial as some people like to make it out to be with the "There are no technical challenges, just give us the money!" lines. It is not true that any old team could have won the X-Prize if Paul Allen had given them $20 million.
On this last sentence, while I don't have any reason to think that John is aiming that comment at me in particular, I have made statements, both at Space Access a couple weeks ago and here, that some might mistakenly take to mean that I would dispute this. I have said that Burt's success lay not (just) in his engineering talents, but more importantly, in his reputation and ability to raise the money. When I said that the mystique of Burt has been broken, my point was that many people believed (and still may believe) that only Burt could have won the X-Prize, in terms of technical capability, and I don't believe that to be the case.
Clearly, only Burt was capable of raising the money (at least from Paul Allen) to win the X-Prize, and that this was the critical achievement. I do believe that there are others who, had they been adequately funded (i.e., on the same level as Burt) could have won as well. That does not mean that I believe that "any old team" could have done it--there were obviously many teams that couldn't engineer their way out of a wet kleenex. It takes a combination of engineering capability and funding. There was more engineering capability than funding available, at least at the time, and only Burt had both, so Burt won.
I also agree with John's assessment that Scaled's approach is low risk, but also high marginal cost and not particularly operable (and not as safe as advertised from the standpoint of propulsion--I've long been on record as saying that hybrids have been overhyped from a safety standpoint, and have suggested to Alex Tai that he should be soft peddling this aspect). They've chosen a hyperconservative design that will be safe, but they also risk getting undercut in price by more operable systems with lower marginal costs, and marginal costs are important when you get into a price war. Sir Richard has the funds to subsidize the system for a while to compete, but I doubt if he wants to do it forever. So they are smart to be a space line that will have access to other vehicles, because I suspect that they're going to decide that they need options other than WK2/SS2.
I also agree that Dreamchaser is not a promising concept (again, partly because hybrids have been overhyped). I thoroughly agree with his pithy assessment of EADS/Astrium's laughable proposal: "Oh, please."
I think that his assessment of his own efforts is valid. He has taken an approach of build a little, test a little, and expanded it to build a lot, fly a lot, and he does in fact probably have more test time than all the other folks put together (though as he notes, XCOR is likely to catch up quickly as they move forward with X-Racer and Lynx).
The great thing is that we don't have to bet on a single horse. There are a number of competing approaches, both in terms of how to develop vehicles, and what kind of experience to offer to the customers. You'll never get me in the fishbowl, both because I'd feel much too exposed, but also because I don't think that I'll ever trust engines alone to get me down safely. That doesn't mean that it won't be a successful concept in the market, though. Unlike many, I don't foolishly extrapolate my own interests to the rest of the marketplace. I think that there will be different strokes for different folks, and that only by trying a number of different approaches will we see how many of them will be successful, and which will be most successful, which is something that will never happen under a government space program (though we had at least a shot at it under Steidle's plan for a CEV fly-off, until Mike came along and canned him, and implemented the One True Concept).
We've been talking for a long time about a return to the early days of aviation, with a wide variety of approaches, and letting the market sort it out. It appears that we're finally on the verge of seeing that happen, and I find it very exciting, for all that it's belated.
Posted by Rand Simberg at 07:03 AMClark Lindsey has helpfully pulled together and organized a bunch of links on one page covering Space Access '08.
Posted by Rand Simberg at 06:00 AMJohn Carmack mentioned this at the conference a week and a half ago, but I don't think I reported it, at least not in any detail. Armadillo is willing to sell vehicles to anyone who wants to fly them (presumably subject to ITAR restrictions):
The way to look at it is as a "rocket trainer", rather than a vehicle that can perform any kind of real lunar or suborbital mission. We don't pretend that the vehicles could actually land on the moon, but if you want to hack on a real, flying system, there is a lot of value to be had.
The price is $500k. The experience of the Lunar Lander Challenge shows quite clearly that you aren't likely to do it yourself for less, even if you spend a couple years at it. Several intelligent and competent people thought otherwise, and have been proven incorrect.You can have either a module or a quad, at your choice. The quad has more hover duration, but it is more of a hassle to operate. A module could be fulfilled right now, a quad would take about three months to build, since we are still planning on using Pixel for LLC this year and other tasks. The engine will be one of our new film cooled stainless chambers, and we will warrant it for ten flights. If it blows up or burns through in that time frame, we will replace it. We will not replace the vehicle if it crashes, but historically our engine problems have been visible at startup, and you should have an opportunity to abort the flight. Ground support equipment is included, except for the lox dewar(s), which would be specific to your local lox vendor. We will test the vehicle ourselves, then train your crew to operate it. You get copies of our experimental permit applications and information about the insurance policies we use for permitted flights. Details on modifications to the flight control software are negotiable.
If he got a big order, or multiple customers who wanted delivery ASAP, I wonder how he'd respond? Would he ramp up production (with the intrinsic risks to quality), or keep supply constant and crank up the price? As I've said for a long time, at some point this is going to have to transition from a hobby to a business for him, and it seems to me that this has the potential to force that decision, if he has a significant number of takers.
I also wonder how much new engines will cost, assuming that they're only good for ten flights (he doesn't say that, but it's all he's willing to warrant them for). Let's say that the engines are half the cost of the vehicle. That would mean a cost of $25K a flight to amortize the engines, which is a lot more than propellant costs. It seems to me that if he only thinks that he can get ten flights, engine life is where his emphasis needs to be for reducing operating costs. It's also hard to see how he can charge the same amount for a module as a quad, since the latter has four engines in it. I'd really like to understand more about this proposition.
He follows up the offer with his assessment of the industry (and his competition), but I'll save my thoughts on that for another post.
Posted by Rand Simberg at 05:38 AMJon Goff has a wrap up of the issues (mostly technical) that came up in the panel discussion last Friday in Phoenix.
As he notes, there was little discussion of what other markets we can find than DoD and NASA. The problem is that until the capability is demonstrated, it's going to be very hard to sell it to the conservative comsat industry. The nearest-term plausible private market that I can conceive of is Bigelow, if he still wants to do his lunar cruises. It would be interesting to put together a business model using Genesis modules swinging around the moon, and see if it's greater or less than projected NASA Constellation needs.
Posted by Rand Simberg at 06:01 AMJon Goff has the Powerpoints of Friday night's propellant depot panel, including mine.
Posted by Rand Simberg at 07:44 AMJeff Foust has a story today on the current real space race (as opposed to the fantasy one between the US and China)--the new race for customers in the suborbital market. It's basically a compilation of last week's XCOR press conference announcement and this past weekend's Space Access conference, both of which I attended. This to me is the key point:
"Quietly, this has turned into a horse race," said conference organizer Henry Vanderbilt during a wrap-up panel at the conclusion of the Space Access conference. "There are a lot of people who could be the first to fly a passenger to suborbit at this point. Two years ago I'm sure the money would have been on Virgin Galactic. It isn't necessarily so at this point."
"What struck me about the events of this week was that we have finally, with all due respect, broken the mystique of Burt [Rutan]," Rand Simberg, an aerospace engineer and blogger, said. "He has had setbacks"--referring to the engine test accident last July that killed three Scaled Composites employees--"and, this week, now he has a competitor." The growing awareness of companies other than Virgin "is going to be very good for the industry.""This perception of a horse race is probably a really, really good thing for investment," said Joe Pistritto, an angel investor. "Ninety-nine percent of the people who could invest in this industry don't know about this industry" but may start to learn about it as the find out about these competing companies.
If it is a horse race, who will win the ultimate prize: not just the first vehicle to enter the market, but the one that wins the market in the long run? The diversity of technical approaches, from the takeoff and landing techniques to the number of passengers, makes any predictions difficult. "If there's four different operators flying people into space, their offerings are going to be a little different," said Pistritto. "So you see an actual segmentation of the market around the experience you want, how much money you have, and where you are."
What I meant about the "mystique of Burt" was the notion that the winning of the X-Prize was some kind of fluke, enabled only because the most brilliant aeronautical engineer in the world applied his genius to it. Many have used this as an excuse to denigrate the efforts of others building suborbital vehicles, which hasn't made it any easier to raise money for such ventures.
Many seem to believe that it really takes the genius of a Rutan to build a suborbital vehicle. As evidence of this proposition, they point out that no other suborbital vehicles have been flown since 2004.
But in so doing, they display a fundamental ignorance of the nature of the technology and the requirements. There is no "one way" to skin that cat, and never was. Burt's design was clever, and perhaps intrinsically safer, but it was not necessary, and there are other, better ways to do the job that are safe enough. It's not at all clear that the SS1 approach is the best one for a commercial application, and if one includes in that the hybrid propulsion, it's already caused delays (though those are partly due to Scaled taking on a project outside their area of expertise--they're an aircraft manufacturer, not a propulsion house) in their development program, and it's certain to result in higher operational costs and increased turnaround time.
The real point is that if only Burt could win the X-Prize, it wasn't because he was the only guy smart enough to design a vehicle to do it. It was because he was the only guy with the reputation of being smart enough to be able to raise the money to do it. When it comes to space ventures, the hardest part is always raising the money. The technical challenges generally pale in comparison.
So, with schedule delays in SS2, now comes XCOR. XCOR has a reputation of its own, hard won over the past eight years, of underpromising and overdelivering. So when they have a (rare, almost unheard of) press conference announcing that they have the design and the cash to build a suborbital vehicle, with an endorsement from the Air Force Research Laboratory, the world listens, and suddenly it's a real race.
Evidence that the mystique has been broken is this CNBC story by Jane Wells from last week, after XCOR's announcement, with the hed "Branson And Northrop May Be Backing "Wrong" Rocket Man!"
Burt is no longer God, other companies are getting serious attention from both business journalists and investors, and it's been a very good week for the new space industry and space age.
Joe Pistritto: We have a couple teams (Virgin and XCOR) that are planning to fly in a couple years, about the same time as the Shuttle is retired. At that point, the NewSpace industry will be the only way that Americans can get into space, and in that first year more people may fly into space on the new vehicles than have flown in space to date. At that point everyone in the country will have a better idea what this new industry does.
Henry Vanderbilt: Also, they'll see that there is a horse race. A year or two ago it was assumed that Virgin would be first to market. That's no longer the case.
Joe: There are going to be different types of experiences at different price points, and as the horse race becomes more clear, it will expose the business to a lot of potential investors who haven't been paying attention up to now. This is good not just for investment, but for creating a supply chain of suppliers that are needed. Still thinks that this is an individual investor market. Venture funds can't justify this investment in the current business environment. Can do it with their own money, but not someone else's. For someone with their own money, there's no industry that is more exciting than this one.
Henry: Not important who comes in first. Emphasis needs to be that there is competition and that we're in for exciting times.
Muncy: Difference between spaceflight participants (passengers) and Russ Blink strapping on an oxygen tank and flying out of the atmosphere on an Armadillo vehicle. Markets are wonderful magical things. We have no idea what the possibilities are (who knew that someone would program Doom eventually when Bill Gates said 640K would be plenty). Smart guys in the military might figure out what to do with these things once they're flying. NASA may want to replace the T-38s now that they're not flying the Shuttle any more (I think he means Gulfstream), or they might want to practice lunar simulations.
Challenge is to figure out how to get customers interested beyond the tourist flights. It will be different flying in the back of SpaceShipTwo than flying in the cockpit of the Lynx. We'll see what the market wants. Lord willing the market will want both, and other flavors. The good things about markets is that if you offer something out there of value, it will be rewarded. Thinking about package tours of all the vehicles: Grand Slam of rockets.
[Update]
At that point, I got pulled up to join the panel by Muncy, so I couldn't blog it.
Anyway, another conference is history. More thoughts later.
Posted by Rand Simberg at 05:35 PMChuck Lauer starts by informing us that Kistler and Rocketplane have been split off into separate companies. Still want to resurrect Kistler--only two-stage reusable out there.
Bottom line was that markets didn't buy the value proposition that NASA could be a reliable anchor customer.
Drawing contrast between their max gees and Virgin's. Rocketplane is four, Virgin is six. Thinks it will be a significant difference. In terms of market research, early studies had to spend a lot of time educating the customer. Now there's a lot more awareness of various products (runway takeoff and landing single vehicle, versus air drop versus vertical) and it would be useful to update the market research.
Need public/private partnership unless you're a billionaire like Jeff Bezos. They are continuing to partner with Oklahoma, and the action is primarily between the companies and the states, not the federal government. Even Florida is waking up the fact that the entrepreneurial space community is the future.
Marketing strategy is to work with partners all over the world. Going after one third of the tourist market. Expect 80/20 tourism/other (microgravity science and microsatellite), but the latter may be a bigger market than they think. Looking at charter flight model with things like reality teevee shows, sponsorship of contests (currently have one going with Nestle--paying full price for two seats and giving them away). Can see the Kitkat promotion at nestle.fr. Another contest in India for a multi-media company with a four-episode show to pick the winner. Winner's sound bite: "I want to see what it's like to pee in space."
They can provide a blank canvas for corporate customers without having to compete with a brand (as they do with Virgin).
Lost a year plus of schedule in 2005/2006 as a result of the focus on COTS. Original plan was to build a couple four-place Learjet version, and then build a bigger version for more throughput. Since then have taken a step back and decided to go directly to the larger vehicle, built from scratch. New vehicle is pure cylinder fuselage, cabin the size of a large SUV 2+2+2 seating, with more revenue per flight but no increase in ops costs. Upgraded to an after-burning turbo jet with higher thrust, shorter takeoff roll, higher air-breathing altitude.
Frank Nuovo designed the interior of the aircraft (former head cellphone designer for Nokia). Everyone sees out the front (even in the rear seats), has their own window, and a personal video display. Will show tail camera view during ascent. Video screen will also be selectable for different angles. May use Google Earth overlay on monitor to know what you're looking at.
[Update at 11:30 AM MST]
I got pulled away from the rest of the Lauer talk, but Clark Lindsey has some good notes, as well as more from the Frontier Astronautics talk.
Posted by Rand Simberg at 09:18 AMJohn Carmack is starting off with a video of Lunar Landing Challenge, showing the failed attempt to win last fall.
Likes the new single-tank design compared to the old quad. It's easier to service, though a little harder to transport because it's much taller.
Seeing views that we hadn't seen at the time, from the three on-board cameras.
Now showing a burn of methane engine that they've been developing with NASA.
Now have four modules of the six that they plan to build their suborbital vehicle. Landing gear turns out to be one of the heavier items, as heavy as the tank. Sticking to dual tanks and single engine on each module. 800 psi pressure tank, with rubber landing pads. Thus tank is also landing gear.
Steps to commercial vehicle. Some debate whether differential throttling will work for control. Recent experience indicates that it is sluggish to respond, because throttling can't be done fast enough on a peroxide engine, but a bi-prop engine may be more manageable.
Definitely disappointment after losing the cup. Thought they'd done everything they needed to prepare for. They'd done many test flights, including five 180 second flights (long enough to go to space). Had three vehicles, any one of which could do the ninety-second challenge. But they had five starts with three wrecked engines. Still not sure what the problem was, but think that (sorry, going to fast to capture it all), but think it had something to do with cooling jacket capacity and start-up processes that resulted in fuel entering the chamber prematurely. BIggest difference was that they turned the vehicles faster at the cup than during normal tests, and there could have been slight differences in chamber pressures or fuel ratios at a given point in time that had catastrophic results. May have had an assembly error (leaving out an O-ring that resulted in a fuel leak), but can't be sure.
Disheartening, but compared to all the other hardware at the airshow with thousands of flights, they couldn't have the statistical confidence as those military aircraft. Learned a lot of lessons. Don't expect it to work the first time. Even with modern engineering practice, it won't happen. Not arrogant enough to think they've solved all the problems, or even know what they are. Expect to lose several of the modules in flight testing. But once they find the problems, they're confident they can solve them. On propulsion, engine now starts and stops like a light switch. Expecting high-speed aero problems.
On business scale issues, things are accelerating. Half a million in contract work, NASA and a commercial customer not to be disclosed. Starting to talk more like Jeff Greason now--transitioning from hobby to business. Won't sell components, because integration is critical. Will sell functional systems (such as propulsion). Currently at around 5000 lbf thrust, will sell for a couple hundred thousand bucks. Will sell complete vehicle for half a million. Talking to Lunar Google X-Prize teams. Won't warrant that it will land on the moon, but if they want to buy one for testing, he'll sell it. Has very little confidence in Google Lunar X-Prize--doesn't think anyone has what it takes. Talking to aerospace companies about sensor suite testing and lunar simulations. Still thinks highly of suborbital passenger market. Thinks there's a market, and has all the pieces: propulsion, control, insurance, etc. Not worried about schedules, because SS2 continues to slip.
Had hoped that he was past the point where he didn't have to invest any more, but did recently. However, more of a float issue, or loan, until some other things come in. "Perseverance and determination will get us there."
Problem with LLC: once a year demonstration is the worst thing for a technical challenge. Adds pressure for tough decisions that can distract from main commercial goals. Afraid to do boosted hops at higher altitudes because they don't want to risk if for the challenge. Have three vehicles, but last year's experience shows that's not enough for redundancy. Ready to do it now, but have to wait until end of year and keep hardware available for it.
[Update a few minutes later]
Clark Lindsey has more on Armadillo, and a report on the previous talk on laser launch by Jordin Kare.
Posted by Rand Simberg at 02:46 PMIf this is true, it's a huge story. It certainly seems plausible. I've always claimed that oil reserves are driven much more by technology advances than by consumption rate:
n the next 30 days the USGS (U.S. Geological Survey) will release a new report giving an accurate resource assessment of the Bakken Oil Formation that covers North Dakota and portions of South Dakota and Montana. With new horizontal drilling technology it is believed that from 175 to 500 billion barrels of recoverable oil are held in this 200,000 square mile reserve that was initially discovered in 1951. The USGS did an initial study back in 1999 that estimated 400 billion recoverable barrels were present but with prices bottoming out at $10 a barrel back then the report was dismissed because of the higher cost of horizontal drilling techniques that would be needed, estimated at $20-$40 a barrel.
It was not until 2007, when EOG Resources of Texas started a frenzy when they drilled a single well in Parshal N.D. that is expected to yield 700,000 barrels of oil that real excitement and money started to flow in North Dakota. Marathon Oil is investing $1.5 billion and drilling 300 new wells in what is expected to be one of the greatest booms in Oil discovery since Oil was discovered in Saudi Arabia in 1938.
It's also a story that will enrage those who want us to tighten up our hair shirts.
Posted by Rand Simberg at 12:32 PMDan DeLong starts off by telling Paul Breed that they learned a long time ago at XCOR that green is bad, stop right now.
This talk is more than just Lynx, they'll be talking about the other things they're working on as well. Can't talk about the Rocket Racer, because Rocket Racing League controls information on that. The piston pump is working well on it, though, and it's the same pump that will be used on the Lynx, for both fuel and LOX.
There is no more Xerus. The concept has been changing, business model changing, aero changing, and they decided that they have a new stable configuration that they can give a name to. That is Lynx.
They're having trouble with the computer display. Making jokes about Microsoft, and saying that their flight software won't be windows. Dan talking about conversation he had night before with Russ Blink of Armadillo, with Russ saying that he'd rather fly a rocket controlled by a computer than one controlled by a human. Dan responded that while it made sense to do a vertical vehicle with computers, but it didn't seem that good to do it with software based on a package called "Doom."
Showing a flow chart of a meat hunt, with overanalysis. Their emphasis is analyze a little, and test a lot.
Showing various past projects--NRO thruster, DARPA LOX pump, methane engine.
Showing video of putting bomb inside of a methane engine to test combustion stability. Four bomb tests, all successful.
Talking about the valves that they've developed, because none were available that met their needs. Also doing own composites for the Lynx. They've come up with a glass-fibre and teflon resin, neither of which will react with oxygen.
Not talking about Lynx. Sunk cost so far $7m, with an estimate of $9M to complete. Showing a video of 50-lbf attitude control thruster, running nitrous/ethane, that will sit in the strakes. This video wasn't shown at the press conference.
Mark II will have hard points on outside. Will carry upper stage dorsally, that can put 10-20 kg payload into LEO. Purpose of the contract is not to help build vehicle. It's for analysis, demonstration and knowledge sharing of its responsive features. Air Force is looking for Operationally Responsive Space (ORS). Air Force has space they need the "OR." XCOR has the "OR" but not the "S." Everyone understand that you can't be cheap at nine times per year, but because XCOR is commercial, they have to make it cheap, which happens by flying often. So Air Force gets the benefit.
Lynx requirements:
Supersonic
Two people
Fly under FAA-AST rules
Goal was to build smallest vehicle that met those requirements.
Showing video of firewall test stand, successive engine runs with increasing pauses, with minimum off time of two seconds. About a half second to start up.
Showing video from press conference now.
Fuel is carried in wing strakes, LOX in fuselage. About two gees at burnout, heading straight up at Mach 1. Mark II will be three gees. Landing speed about 95 knots, takeoff about twice that.
Posted by Rand Simberg at 11:31 AMTim Bendel, of Frontier Astronautics, is giving a presentation on how to address the gap between the ability of garage-based startups and larger companies to raise money. Not very many angels with money who are interested in space who aren't already doing it.
Giving a history of the Zeppelin. After the count lost his first ship, he threw in the towel, because he's lost all his money, but a lot of Germans sent him money, and he ended up with more than he had started with. Are there space enthusiasts who could do the same thing?
Talking about Warren Buffett's stock, and its high value that he refuses to split. Independent holding companies evolved by purchasing a few shares of Berkshire stock, and then issuing new, lower-priced stock based on that asset.
His proposal is to gather small investors for the holding company, put their money into escrow, and fund start-up space companies off the interest. Different "flavors" or classes of stock would be issued, with different Class A escrow accounts, which could be associated with specific start ups.
Unfortunately, most of the info is on his charts, which I can't read because I'm all the way in the back (where the laptop power is), and too dense for me to quickly transcribe even if I could.
He claims that it avoids sunshine laws, according to SEC lawyers that they've talked to. The basic idea is to provide a means for small investors to invest in small companies, albeit indirectly.
Issues: Have to pay for licenses, need to be broker/dealer, etc., a lot of paperwork. Probably about a hundred thousand bucks to get started. Goal is to do it for profit, in addition to helping space industry. Makes money on trades, but could also use other investment tools, such as puts and calls.
Has a business process patent on it, needs about a quarter million to start up.
Hard for me to evaluate it, given my funky state of consciousness, and inability to look at the numbers. I'll talk to TIm about it later.
Posted by Rand Simberg at 10:07 PMWhile I slept, XCOR lifted the news embargo at midnight PDT (presumably to allow coverage in today's WSJ).
I'm still a little bleary (and of course still attending the press conference later this morning), but Clark Lindsey has a lot more. Just scroll down.
[Update a few minutes later]
Here's more, from east coaster Jeff Foust, here and here.
Posted by Rand Simberg at 05:32 AMFor the end of Windows XP.
I'm still using Windows 2000 myself. And I'm transitioning over to Linux.
Posted by Rand Simberg at 07:27 AMJonah is wondering why Hollywood types always imagine big businessmen knocking off their enemies, when this seems to happen so rarely (if ever) in real life.
I know I've blogged about this before, but a diligent search doesn't turn up the post, so I'll just repeat it.
Here's my theory. Even ignoring the fact that a lot of Hollywood writers tend to be leftist, some of them may actually have personal reasons to hate "big business" and think it venal. For them, it often is.
First of all--they work in Hollywood, for those well-known paragons of probity and above-board accounting, television and film studios, and production companies. And horror stories about them abound. One could easily see why, if that was the only experience one had with the business world, one would have a pretty jaundiced view toward business and businessmen.
But there's another part that is less obvious. People tend (rightly) to write what they know. And when screen writers are between screen-writing gigs, who do they work for?
Well, here's a clue. What is one of the most common businesses to be depicted in television and movies? Think, for example, "Bewitched." Or "Thirty Something."
That's right. Ad agencies. I haven't done the research (it would be a good thesis project), but I'll bet that television and film characters work at ad agencies vastly out of proportion to the number of people who do so in the real world.
After all, it's a natural fit for a creative writer.
But it's also (based on a lot of stories I've heard from people who have done it) one of the most vicious, back-stabbing industries in the nation, dominated by creative types rather than rational businessmen and good managers.
So, it only makes sense that if your only employment experience with business, big or otherwise, is working for the entertainment industry or the ad business, you're not going to have much appreciation for how a real business, where you have to actually develop and manufacture things that people go out and willingly buy, and has to be run by people with a talent for business (not murder and skullduggery), actually works. It's actually quite similar to the reason that life in the military is rarely depicted accurately. They have no real-life experience.
Posted by Rand Simberg at 07:35 AMLet's hope so. A key point that the author misses, though, is that one doesn't really learn anything in them, other than how to report things. It's a metadegree, like a degree in education (though not quite as bad).
One of the reasons that much reporting is so bad, and that many bloggers can run circles around so-called journalists, is that they actually have knowledge to impart, and they can usefully analyze events in a way that a generalist, or "journalist," simply can't.
Posted by Rand Simberg at 06:11 AMMike Griffin is worried about losing a Shuttle crew if the program is extended:
"Given that our inherent risk assessment of flying any shuttle mission is about a 1-in-75 fatality risk, if you were to fly 10 more flights, you would have a very substantial risk of losing a crew. I don't want to do that."
If we accept his risk number, that translates into a 13% chance over ten flights. That doesn't seem "substantial" to me. There are a lot of good reasons to not extend the program, but risk of crew loss isn't one of them. I'm sure that most of the astronauts would be happy to take the risk, and the real loss wouldn't be astronauts (of whom we have a large oversupply), but the loss of another orbiter, which would almost certainly end the program, because they probably couldn't manage with only two left. If what they're doing is important enough to risk an orbiter, that is almost literally irreplaceable, it's surely important enough to risk crew, who are all volunteers, and fully informed of the risk.
When I was watching coverage of the cranewreck in Manhattan yesterday, they cited a statistic from the Bureau of Labor statistics that there were forty-three construction deaths last year (I think in New York alone). Can someone explain to me why is it acceptable to kill construction workers, but not astronauts?
On the other hand, here's one thing that I do agree with Mike on: the last thing we need is another space race.
Posted by Rand Simberg at 08:11 AMDavid Freddoso has some thoughts on Boeing's loss of the tanker contract, and free trade.
Posted by Rand Simberg at 02:52 PMYesterday, I speculated that Spitzer's downfall would cheer up Wall Street. Well, I guess they finally decided to party today. Of course, that potentially inflationary gusher of liquidity today probably didn't hurt, either.
Posted by Rand Simberg at 02:08 PMIt's not insurance.
Nothing new here to people familiar with the situation, but many don't seem to understand the problem. But this is the origin of it:
Health insurance started to change, though, during the Truman administration. (I hasten to mention that I wasn't actually there: I was born during the Eisenhower administration, when the process had only gotten started.) Truman wanted to implement the progressive new notion of a national health care plan, but couldn't get it through; at the same time, post-war wage controls were still on, so employers bidding for new workers had to find other ways to compete.
Through a sequence of compromises, what came out of it was a system in which companies and only companies could buy health insurance and health care for their employees, and deduct the cost as a business expense. My father's music store and the steel mill across town could buy health insurance, basically, at a discount. (My uncle the butcher couldn't; he wasn't a "business.")Years pass. (Insert visual of wind-blown calendar leaves here.) Medical care becomes more complicated, legal conditions change, and a lot of things that used to be major medical issues that mostly affected the life insurance rates become things that could be cured, or at least managed. Increasingly, what was "major medical" insurance became, simply, health insurance; we expected the insurance companies not just to pay for unexpected events, but for the normal sort of day-to-day maintenance we all need.
People will pay to repair their car, or their pets, or appliances out of pocket, but somehow, over the past decades they've come to believe that it's a fundamental human right to have someone else pay for your doctor visits. Until we cut off this disastrous government policy of tying health insurance to employment, and allow everyone to deduct medical expenses on a level playing field, and get people to understand that we have to return to the model of health insurance the problem will not be solved.
Posted by Rand Simberg at 08:27 AMI've always thought that Monster cables were a scam, and that the supposed quality improvement couldn't justify the ridiculously high prices, and that it was quite annoying that they've monopolized so much shelf space in the electronics stores. It's hard to get reasonably priced audio cables (though things are better at Home Depot). But really, I've always figured that most people wouldn't be able to tell the difference between Monster and lamp cord.
Well, it turns out that supposed audiophiles couldn't distinguish between Monster and coat hangers. But I suspect that the scam will continue, with salespeople continuing to push them. There are probably great margins for both the manufacturer and the retailers.
[Via Geek Press]
Posted by Rand Simberg at 05:56 AMElizabeth Karmel has some thoughts on barbecue:
Restaurateurs don't necessarily want you to eat the whole thing; they are giving us what we've asked for. Americans don't like restaurants that serve small portions. Whether they eat it all or should eat it all is another matter; consumers vote with their dollars and like it or not, American consumers love and buy big portions.
I've discussed this before, but the reason that restaurants serve so much food is related to the reason that the Space Shuttle (and space launch in general) cost so much. How's that for a topic segue? It always comes down to marginal cost.
The Space Shuttle is expensive per flight, because they have to support all of the overhead in Houston and the Cape, but fly very few times. But the marginal cost (the cost of flying the next Shuttle flight, given that you're already flying) is probably about a hundred fifty million or so (the cost of the expended hardware, basically, and specific crew training) which is much less than that average cost (typically well over half a billion). Same thing applies to the space station. Back in the nineties (before Freedom became ISS) they were trying to cut five billion dollars out of the projected thirty-billion dollar development budget. Joe Talbot, the man at Langley who was tasked with coming up with a plan to do so, told me (in an exasperated tone), "that's the cost of the hardware." In other words, they could cut out the hardware, and only spend twenty-five billion, and have no station at all. Or they could spend a little more money (thirty-five billion instead of thirty billion) and double its size. Being a government program, the budget cutters tend to make more of the former sorts of decisions than the latter ones.
It's different for a business, even though the economic issues are exactly the same, because they're driven by actual customers.
Even if a restaurant served you no food at all, if all you did was come in and take up table space and staff time for a certain period of time, they'd still have to charge you quite a bit, because much of the cost of a restaurant meal is overhead to cover costs of rent, utilities, staff salaries, etc. The cost of the food itself (unless it's a very high-end restaurant, where you're eating lobster, and filet, and larks-tongue bisque with a truffle reduction) isn't all that much. They could cut the portions in half, but they wouldn't be able to cut the price of the meal by half. Conversely (and this is what the market drives, as Elizabeth says), they can double the portions while adding very little to the price. That's the economics behind "super sizing" soft drinks and fries--you're simply adding a little sugar and spuds, which are very cheap, to the meal whose overhead has already been covered by the basic order.
And of course, I think that one of the (many) causes of the obesity epidemic in the country is the fact that as we've grown wealthier, we go out to eat a lot more. When the portions are large, you're going to have a tendency to eat it. A lot of us would be better off simply sharing a meal with our dinner companions, but the restaurants discourage this, for obvious reasons--they don't get enough to cover their overhead costs if everyone does it. When you're cooking for yourself, you not only have a better idea of the cost of the meal, because you're using food that you purchased, but it's also easier to quit eating and just put the leftovers in the fridge, rather than have to ask for a doggie bag and hope that you get it home soon enough.
Bottom line, if you really want to lose weight (and save money) don't eat out.
[Update]
There's a good point in comments:
I have these same problems cooking for myself. It's hard to buy things in quantities for one or two portions. You end up with three or four servings.... (Re: try to cook a real meal for one).
Yeah, that's another overhead problem. Unless you're making something fancy where individual items are being created (e.g., home-made ravioli) or labor intensive (peeling/deveining shrimp) it doesn't take much more effort to cook for two, or four, than for one. The basic overhead of meal preparation is the same. It takes me about half a minute to clean/cut a potato, so adding a couple more for a lot more mashed potatoes, all done in the same mixing bowl, is no big deal, and baking a chicken is baking a chicken, whether for one of four. This is one of the benefits of marriage (or at least cohabiting).
I cook dinner almost every night, but interestingly, I rarely cook breakfast, because it seems like a lot of work, (frying bacon, making coffee, sectioning grapefruit, hashing browns, frying eggs, making/buttering toast, most of which all has to come out about the same time) for not that great a meal. I would never do it just for myself, and with the two of us, I still generally reserve it for weekends.
Another good point, from the same comment:
...the combo of A and B has been sending me to fast food format restaurants. I can pay little and buy by the item (re: any portion size I want). If I only want one chicken taco... I can buy one chicken taco (probably for $1-$2)... If I want two or three, they can do that too...
I've been noticing that, too. I've never ordered a "meal" at a fast food place, because they don't have anything I want to drink (I don't do soft drinks, and don't like iced tea--in restaurants, if I don't have beer or wine, I drink water). I generally order a sandwich a la carte, and sometimes a small fry. But I've seen that Taco Bell has a lot of individual, reasonably priced items, and other places have "dollar menus" as well, so perhaps they're also trying to satisfy that end of the market. One of my favorites is Checker's (around here, anyway, also known as Rally's in some parts of the country), where they sell a double fish sandwich for a little over two bucks. There are enough customers that they can afford to sell them to those who want them without fully amortizing the overhead, or if they do, at low margin, and it expands their potential customer base.
One other point. It used to be that Mexican restaurants were one of the best ones to have for exactly this reasons. You could charge a low price for a meal with very cheap ingredients (corn meal, ground...meat, rice and beans), but still have great margins. A lot of them have started to get greedy lately, though. You used to be able to find a really cheap, decent hole-in-the-wall Mexican place, but it's getting harder and harder, at least in my experience. Of course, since moving to south Florida, I don't have as much variety to choose from as I did in LA.
[Update at 5:20 PM EST]
This is another good point from a commenter:
Cooking for one or two can be done, but it involves cooking for four and freezing for three.
Yup. I've made a big pan of lasagna for myself (used to do it a lot in college). Eat some, put some in the fridge, freeze the rest. And this was in the pre-microwave (at least for struggling students) days.
[6 PM update]
One other point, that I should have made in the original post. The things that get supersized (high-glycemic carbs) are not just the cheapest things to add to the meal, they're the worst things for us to eat, from the standpoint of weight gain, inducement of diabetes and increase in artery risk. And the things that we need more of (proteins) are relatively expensive. The basic economics of food (at least at the current state of technology) militates against a healthy diet. This is also one of the reasons that the "poor" in this country are both overweight and malnourished (scare quotes because "poor" is relative. No one in the US is truly poor, compared to much of the world).
Posted by Rand Simberg at 12:30 PMIs Obama demagoguing NAFTA just to win the nomination? Will he continue to do so in the general election, if he gets the nomination?
Well, at least I'm glad to see that he's not as bad on free trade as his campaign rhetoric suggests. But one wonders what other flowery things he's saying that he doesn't really mean.
Posted by Rand Simberg at 10:02 AMHope I'll see some of you at the Space Access conference in Phoenix next month.
[Update at 9:30 AM]
Attendees will get to hear John Carmack talk about cool vehicles like this one.
Posted by Rand Simberg at 05:33 AMA fascinating and very useful article on the value of waste. It's must reading for anyone who wants to entrepreneur on the web, in my opinion. I found the byline amusing:
Chris Anderson (canderson@wired.com) is the editor in chief of Wired and author of The Long Tail
Will he be giving the book away?
[Via Geek Press]
Posted by Rand Simberg at 05:12 AMAOL is pulling the plug on Netscape. I think that the beginning of the end was when they acquired it. But it lives on, really, in the Mozilla products.
Posted by Rand Simberg at 01:55 PMSharper Image has filed for Chapter 11. I wonder if they'll be able to reorganize?
I always thought their stuff was overpriced, and apparently a lot of people agreed with me. They also spent a lot on sending out all the catalogs. I wonder if their business model even works any more, what with Amazon and all.
Posted by Rand Simberg at 10:51 AMAs Clark says, I don't know why anyone would think that space scientists or astronauts are experts on business. I don't really care what Kathy Sullivan thinks the prospects are for suborbital tourism, and if I thought that astronauts' opinions on the matter were of value, I can find many astronauts (including John Herrington, Rick Searfoss, etc.) who would disagree with her.
And who is this "Alvin" Aldrin of which they speak? Is that Andy's evil twin? When I do a search for "Alvin Aldrin" I only get one hit--this article.
A couple other questions for Alvin/Andy. What numbers was he using for the Raptor cost? Marginal, or average per-unit? It makes a big difference.
In addition, I always get annoyed when people use a military fighter as a cost analogue for a spaceship. A lot of that dollar-per-pound number for the plane comes from something in it that weighs nothing at all--software. The avionics for the weapons systems, and the defensive systems are non-trivial in cost as well. Designing a combat aircraft, designed to kill other things and avoid being actively killed by other things, is an entirely different problem than designing a vehicle that has to only contend with passive and predictable nature (and pretty benign nature, for the most part, at least for suborbital). I'd bet that Burt's own cost numbers for the SS2 already put the lie to Andy's chart.
[Late afternoon update]
Jeff Foust has a much more extensive writeup of the discussion, which he apparently attended. As I suspected, it was Andy, not Alvin, Aldrin.
Posted by Rand Simberg at 08:39 AMIs this the future of air travel?
Engineers created the A2 with the failures of its doomed supersonic predecessor, the Concorde, very much in mind. Reaction Engines's technical director, Richard Varvill, and his colleagues believe that the Concorde was phased out because of a couple major limitations. First, it couldn't fly far enough. "The range was inadequate to do trans-Pacific routes, which is where a lot of the potential market is thought to be for a supersonic transport," Varvill explains. Second, the Concorde's engines were efficient only at its Mach-2 cruising speed, which meant that when it was poking along overland at Mach 0.9 to avoid producing sonic booms, it got horrible gas mileage. "The [A2] engine has two modes because we're very conscious of the Concorde experience," he says.
Those two modes--a combination of turbojet and ramjet propulsion systems--would both make the A2 efficient at slower speeds and give it incredible speed capabilities. (Engineers didn't include windows in the design because only space-shuttle windows, which are too heavy for use in an airliner, can withstand the heat the A2 would encounter.) In the A2's first mode, its four Scimitar engines send incoming air through bypass ducts to turbines. These turbines produce thrust much like today's conventional jet engines--by using the turbine to compress incoming air and then mixing it with fuel to achieve combustion--and that's enough to get the jet in the air and up to Mach 2.5. Once it reaches Mach 2.5, the A2 switches into its second mode and does the job it was built for. Incoming air is rerouted directly to the engine's core. Now that the plane is traveling at supersonic speed, the air gets rammed through the engine with enough pressure to sustain combustion at speeds of up to Mach 5.
A combination turbofan/ramjet. Hokay.
If I understand this properly, the idea is to fly fast subsonic over land to avoid breaking windows, and then to go like a bat out of hell over the water. When I look at that design, I have to wonder how they can really get the range, with all of the drag that is implied from those huge delta wings, not to mention the wave drag at Mach 5. I also wonder where they put the hydrogen--that stuff is very fluffy, and needs large tanks. It's probably not wet wing (it would be very structurally inefficient), which is why the fuselage must be so huge, to provide enough volume in there for it.
Sorry, but I don't think that this will be economically viable. As is discussed in comments and the article, hydrogen is not an energy source--it's an energy storage method, and it's unclear how they'll generate it without a greenhouse footprint. Moreover, it's not as "green" as claimed, because dihydrogen monoxide itself is a greenhouse gas. I'll bet that this thing has to fly at sixty thousand feet or more to get itself sufficiently out of the atmosphere to mitigate the drag problem, and that's not a place where you want to be injecting a lot of water.
This concept doesn't learn the true lessons of Concorde: like Shuttle, a lot of people have learned lessons from Concorde, but the wrong ones. The correct lesson is that we need to get rid of shock waves and drag. Once we do that, we'll be able to cruise at reasonable speeds (say, Mach 2.5) everywhere, over both land and water, so we won't have to build the vehicle out of exotic materials and eliminate windows. We'll also be able to have fast transcontinental trips (two hours coast to coast) which is another huge market that this concept doesn't address at all. Finally, it has to do it with a reasonable lift/drag ratio, so that ticket prices will be affordable. And I think that the fuel issue is superfluous--Jet A will be just fine for the planet, as long as fuel consumption is reasonable, which makes the vehicle design much easier, with much more dense fuel.
Fortunately, I've been working for over a decade with a company that thinks it knows how to do this, and I'm hoping that we'll be able to start to move forward on it very soon.
[Via Clark Lindsey]
[Update in the late afternoon]
In response to the question in comments, there's not much publicly available on the web about shock-free supersonics, but here's a piece I wrote a few years ago on the subject.
Posted by Rand Simberg at 08:13 AM...as only Iowahawk can.
Posted by Rand Simberg at 07:23 AMScientific American published a grand plan for nationwide terrestrial solar power generation system in the January issue. Its highlights:
- A massive switch ... to solar power plants could supply 69 percent of the U.S.’s electricity ... by 2050.
- A vast area of photovoltaic cells [and solar concentrator power plants] would have to be erected in the Southwest.
- Excess daytime energy would be stored as compressed air in underground caverns to be tapped during nighttime hours....
- A new direct-current power transmission backbone would deliver solar electricity across the country.
- But $420 billion in subsidies from 2011 to 2050 would be required to fund the infrastructure and make it cost-competitive.
It's an ambitious plan that could sharply decelerate CO2 emissions and increase the US output of "green" power. Heroic plans require heroic proof. A critical analysis follows.
Some high level critiques are the following:
Consider investing in terrestrial solar power for security reasons or as a contingency, but it's a lot of faith to get the case to work for half of daily electricity demand.
Posted by Sam Dinkin at 06:13 AMI disagree with more than Simberg in Snead's presentation of a case for an aerospace plane and space based solar power (SBSP):
At $100 per barrel, America’s annual cost of imported oil is about $440 billion per year. During the six to eight years required to bring the aerospaceplanes into operation, America will send to foreign countries $2.6–3.5 trillion for imported oil. Every year that we fail to act to substantially decrease our need for imported energy is $440 billion spent unnecessarily in the future.
The $440 billion that we spend on imported oil is primarily going to fuel cars. SBSP would provide electricity. We can already save 90% on energy expense by switching from oil to electricity. If SBSP replaces the energy we are importing, there is still the expense of batteries and electric propulsion or similar. The cost of the batteries and hybrid or electric propulsion system is more expensive than the fuel saved for many drivers.
In sum, we can already achieve energy independence from foreign oil simply by building more coal-fired power plants and implementing electric cars. But we are not implementing electric cars with cheap power from coal. Why would we do so with expensive power from SBSP? And expensive it would be.
The near-term system Snead refers to costs $70 billion to develop and will cut costs to orbit to $1000/lb (including development costs) if there are 240 missions per year to deliver six million pounds to LEO. More expensive to GEO. With manufacturing costs $160/lb and solar only 4x as efficient as terrestrial solar, Snead's space plane has done nothing to reduce the cost of solar from terrestrial costs much less make it competitive with coal for electricity or electricity competitive with oil for transportation.
---- Update 12/5/7 4:00 PM CST ---
Charles Miller pointed out that there are plenty of high value off-grid uses of power where terrestrial solar is unsuitable. Anywhere that generator fuel is being flown in comes to mind: that's about $6/kwh; 625,000 lbs of solar cells can deliver 20 MW of continuous power at that price ($1B/year) for perhaps $20 billion (which would be $32,000/lb all in). For 1 GW at $0.30/kwh (a good guess at the value of the median off grid use for which terrestrial solar is unsuitable), it's $2.5B/year revenue which at $1,000/lb in launch costs + $150/lb in manufacturing costs at about 45w/lb would cost about $25B. That's definitely achievable by current space technologies at a flight rate sufficient for 1 GW/yr in installed capacity (22 million pounds) much less 20 GW/year for 10 years for 10% of US 2040 power needs (440 million pounds/year or trillions of dollars of launch demand over the ten year window). $440 billion in launch demand per year would be about 150 times the current annual money demand and would require a steep ramp up.
I am forced to retract my criticism of Snead since this closes the revenue portion of the business case for his space plane: demand for $1000/lb launch costs would allow 150 million pounds of SBSP to deliver 6.75 GW of electricity after 25 years at between $0.50 and $1 per kwh which is worth $30-60 billion per year. The plane/SBSP program could be paid for out of revenues in less than 10 years after it starts flying and after three years if the SBSP generators can be sold for ten times annual revenue.
Posted by Sam Dinkin at 02:57 PMCessna is moving some of its production to China.
Posted by Rand Simberg at 09:57 AMI recently canceled my account with Vonage and on behalf of Space Shot canceled our contract with Custom Weather upon switching to AccuWeather which is free. It took about fifteen minutes to navigate all of the extra offers that Vonage wanted to make me to try to retain me. It may be good short-term business, but I felt their hard-sell tactics alienate me. I draw the line if an organization asks me "are you sure?" after I have already said I don't want something, I complain to their customer service for being rude. They may be retaining a few extra customers, but I'll remember how long it took to cancel the service and be less likely to buy again given the "exit tax". These last few customers seem sub prime.
Space Shot also canceled its contract with Custom Weather. What do you think this term in my contract with them says?
...this Agreement will continue for further successive one year periods until it is terminated by either party giving to the other not less than 90 days written notice prior to the end of the initial one year period or on any subsequent anniversary of the Effective Date...
I think it means Space Shot can cancel with no notice on its second and subsequent anniversary with no notice. Space Shot also requested early termination of the current year contract which is in no way prohibited and a refund which is also consistent with policy as reported in the contract. Not acknowledged.
Custom Weather CEO, Geoff Flint wrote me:
I apologize if our lawyers did not make that clause clear enough since the "or" that you refer to is associated with the last verb which was "giving" in the clause "giving to the other not less than 90 days written notice."
and later:
Our contract was put together by a top law firm and like I said in my last email, the "or" that you referred to is always associated with the verb closest to the "or" statement and in this case, that required giving 90 days notice.
But that would lead to "this Agreement will continue for further successive one year periods until it is terminated by either party giving to the other not less than 90 days written notice prior to ... on any subsequent anniversary of the Effective Date". The "on" in this read makes no sense to me.
Perhaps this read: "this Agreement will continue for further successive one year periods until it is terminated by either party giving to the other not less than 90 days written notice ... on any subsequent anniversary of the Effective Date" also makes no sense. That would be 364-730 days notice which contradicts the "90 days".
The only thing that makes sense to me for the second condition is "this Agreement will continue for further successive one year periods until it is terminated by either party ... on any subsequent anniversary of the Effective Date".
If we agree with Geoff's read, he is committing Custom Weather to an annual negative checkoff where the negative checkoff comes ten months before the contract renewal date. His read further commits his firm to a no-refund policy.
Is Vonage a case of a gotcha cancellation policy, Custom Weather, or both, or neither?
Posted by Sam Dinkin at 11:22 AMAs a Boeing stockholder, this doesn't make me very happy.
Posted by Rand Simberg at 11:09 AMHere's evidence that my skepticism about rebates is warranted:
I am staring at more than 1,300 rebate requests sent to Vastech on Bonaventura Drive in San Jose. The envelopes were tossed - unopened - into a garbage dumpster near Vastech. I have two boxes of envelopes that were thrown out without being processed. In all of my years of reporting, I have never encountered such outrageous behavior against consumers.An employee of nearby Dominion Enterprises found the letters, along with hundreds of others addressed to Vastech, at his company's dumpster. He turned them over to his boss, Joel Schwartz, who gave them to me. All of the letters were addressed to UR-04 Rebate or some variation of the product name at the Vastech address.
The problem is that it's no skin off Fry's or Best Buy's nose if people don't get their rebates. They just claim that it's up to the manufacturer. So the fraud will continue. And I'll continue to ignore the rebates.
Posted by Rand Simberg at 06:15 AM..and this is just one more reason why. Apparently, Sony VAIO customer service sux.
Posted by Rand Simberg at 11:18 AMIn Second Life. One of them is Reuters. The Pontiac site sounds pretty cool, with test drives, and free land.
[Update a few minutes later]
Alan Boyle has a story on learning rocketry there.
Posted by Rand Simberg at 06:14 AMDell is going to start shipping machines with Ubuntu pre-installed.
Posted by Rand Simberg at 09:36 AMYou can apparently make good money shorting stocks in which the CEO moved into a palatial mansion.
Posted by Rand Simberg at 08:06 AMMy press guy also runs a PAC that is trying to legalize Texas Hold 'Em in Texas. Should be quite a show at the Texas Capitol tomorrow.
Posted by Sam Dinkin at 03:17 PMHere is my Space Access presentation:
I asked Robin about her half-price contract with Constellation Services and she says it does not include a test flight, so perhaps if we are not first to buy that, we can have half as many players to get to the trip for two around the Moon.
Posted by Sam Dinkin at 09:46 AMJohn Carmack's announcement of a modular rocket that can reach suborbital space for $25,000 per module is revolutionary. Each module can independently reach suborbital space. Group the modules together and any size or shaped payload can reach suborbital space. The cost to get to space is $250 per module in fuel costs.
In a video that John said will be posted to his web site, he showed the modules being hooked together in a square arrays. These arrays can then be stacked for staging.
He predicts that he will produce the Armadillo orbital "Sputnik" which John also referred to as Mitchell Burnside-Clapp's DYANN--Do You All Notice Now?
There are two revolutions here. The first is an open source garage revolution. With a small warehouse and a budget closer to Charlie Farmer's in Farmer Astronaut than COTS winners RpK and SpaceX, Armadillo in a humble, matter-of-fact tone is brashly announcing an orbital program.
The second is the price of the revolution. At $25,000 per module, the capital cost per delta V is unprecedented and substantially lower than RpK or SpaceX.
This revolution was incrementally developed in plain sight and demonstrated in plain sight. No one thought Carmack's Pixel and Texel were minimum concept proofs for a 64-module version. No one thought that by looking at the specifications they were seeing the ultimate cheap first stage and second stage and third stage.
Carmack thinks he can get the mass ratio down from 27 to 15 with some low cost evolutionary modifications. At 15-1, he can loft "Pixel 2" onto a suborbital trajectory with a 64-module first-stage lifter made up of 16 Pixels arrayed in a 4-4 grid or 8x8 single modules. Pixel 2 will be full of fuel and be the second stage. On top of Pixel will be a single module with a 25 lb. payload that will make it all the way to orbit. The cost for this delivery? The capital costs would be about $1.7 million if he can stay under $25,000 per module. If only the first stage is reusable, the cost per flight would be $150,000. If the first and second stage are reusable, the cost per flight would be $60,000. For a three stage system, that is a not very revolutionary price of $2400 per pound to orbit (albeit revolutionary vs. old space of $10,000+ per pound though.)
If they achieve a two-stage to orbit system where the second stage is also reusable, that would deliver a 100 lb payload to orbit for $35,000. That is roughly half fuel and oxidizer and half capital assuming a 100 flight lifetime. $350/lb is revolutionary. If this could be scaled up to Spacex Falcon IX payload size of 22,770 lbs., that's $8 million or $22 million for a Falcon IX heavy sized payload of 62,500 lbs. An array of 100x100 modules supporting a second stage array of 25x25 modules boggles the mind and would cost $265 million in capital costs at $25,000 each. The flight rate assumptions would not be invalidated, however, because the vehicle could be broken up to support the suborbital tourism industry and smaller orbital payloads.
On the optimistic side, this price is before mass production. This mass ratio is before switching to methane (a 10% improvement in ISP over alcohol and a 50+% fuel price drop too). Google revolutionized servers by using modular white box CPUs. Now Carmack is making a bid to do the same thing. Nevertheless, Henry Vanderbilt cautions me that there is a long way to go from a view graph to orbit.
---------Update 3/24/07 7:00 MST---------
A wide plane requires a bunch of successively stronger connectors moving inward and results in very little additional payload delivered by the outside modules. This is especially true with a square grid which require more connections moving in from the corners than a hexagonal one. Other possibilities are more stages so connections are shorter and more vertical and larger, taller modules for lower stages.
Posted by Sam Dinkin at 06:09 AMHere's an interesting piece that says it's hurting small investors:
Today, it is much harder to get in on the firms that could be the next Home Depot, unless you are a super-wealthy investor that can participate in private equity deals. According to BusinessWeek, the median market cap of a company going public was $52 million in the mid-1990s. Today, it's $227 million. This means that average investors are increasingly shut out of a company's emerging growth stages, where they would, yes, take the most risks, but also could reap the biggest returns.The most costly provision, Section 404, forces auditors and executives to sign off not only on the accuracy of financial statements, but also on a company's internal controls. The unaccountable Public Company Accounting Oversight Board created by the law has defined "internal controls" very broadly, to include a firm's software and other items that have little relevance to financial statements. Some say the law should be called the Accountants Full Employment Act.
As usual, hard cases make bad law. This gross overreaction to the Enron debacle can only make it harder for space entrepreneurs to raise money. Here's hoping for some reform.
Posted by Rand Simberg at 11:33 AMThomas James, on scamming corporate executives with touchy-feely seminars.
Posted by Rand Simberg at 06:05 AMWhen you call Earthlink to cancel an account that you've had for years, but haven't used for years, and for which they've been getting hundreds of dollars per year forever, they put you on hold forever.
Guess I should have chosen another option...
Posted by Rand Simberg at 02:54 PMSell "Miracle Whip Classic," at a higher price, and everyone can be happy.
Posted by Rand Simberg at 03:25 PMWSJ (subscription required) says Electronic Arts is joining Microsoft in an ad serving service for video games:
Advertising in games remains a relatively small business, but many game publishers believe there's a large untapped revenue opportunity in displaying ads to their audiences. Many games are played by 18- to 34-year-old men, a prized demographic for marketers that is spending more time playing games at the expense of traditional ad-supported media like television....In the past, companies like EA have integrated mostly "static" advertisements into their videogames that don't change throughout the life of the game ... EA is currently estimated to earn revenue in the single-digit millions from such ads....Such ads must be integrated into a game six to eight months before the title is released...[vs.] "dynamically" insert advertisements into games on a regular basis...
With hundreds of hours playing a title, ad revenues could hit tens of dollars per player which could be billions of dollars vs. millions. In a competitive industry, this should drive the sticker price of the games down.
There is a chicken and egg problem though. Ad rates for games are too low right now for game producers to make the ads too intrusive. That makes the ads less valuable per viewing.
Look for more freeware titles and 100%-mail-in-rebate deals around late 2008 for Christmas 2007 titles that have ads.
Posted by Sam Dinkin at 02:23 AMHere's an interesting strategy--Ford is considering taking the company private. That could help a lot, if they have the cash to do it.
Posted by Rand Simberg at 12:14 PMGM may survive, if you can believe this journalist's take. Of course, he's a Detroit journalist.
I should point out that I have a semi-emotional stake in the outcome.
Posted by Rand Simberg at 08:23 PMIn light of Airbus' current woes (they haven't sold a single 380 this year), can I call 'em, or can I call 'em?
I have to admit, though, that I had no idea how much trouble the 350 was in. But the 380 was obviously a disaster from inception, at least to me. Kind of like Ariane V...
[Update a few minutes later]
I should add that I also never believed that Boeing's "Sonic Cruiser" was real.
Posted by Rand Simberg at 02:42 PMAOL is pushing the nation to broadband by decreasing the gap between broadband AOL and regular AOL by $15/month. This seems like the biggest and last key tipping point toward US broadband. Dialup AOL will stay the same price. They expect to make up the subscriber fee losses in increased advertising revenue. This will be a tricky transition, but if successful, we could be watching Warner content over the web. TV sales and ad sales could indeed make this a good idea.
In the mean time, AOL is about to give millions of people $180/year. According to WSJ:
Of AOL's 18.6 million domestic subscribers, about six million get their Internet access from a high-speed provider ... AOL would let subscribers with a high-speed connection keep their AOL account free.
Between the Bill Gates foreign policy and the AOL fiscal policy, private America is stealing a march on the Federal Government.
Posted by Sam Dinkin at 05:52 AMAirbus is spiralling in. Nice to be a Boeing shareholder, these days.
[Afternoon update]
Here's more.
Posted by Rand Simberg at 09:57 AM