The editors of the Wall Street Journal don’t understand something very basic about power companies:

The deadly fires in Maui last week are still being investigated, and there may have been more than one contributor. But one culprit that seems to be emerging is the tradeoff the local utility had to navigate between power grid safety and the government-mandated green energy transition.

Video footage points to fallen power lines as a possible cause of the deadly fires. Hawaiian Electric’s bonds and stocks have sold off this week as investors worry that the utility will be liable for fire damage.

and

Hawaii’s mandate was an especially tall order since only about 20% of its power in 2015 came from renewables. The islands lack large amounts of empty land to build solar and wind. They also lack natural-gas power that can ramp up quickly to back them up. Most of Hawaii’s power was derived from oil and coal.

To meet the government mandate, Hawaiian Electric embarked on a rapid renewable build-out, which involved heavily subsidizing rooftop solar and batteries and contracting for large-scale renewables at elevated prices. Oil can be an expensive fuel source, but decommissioning fossil-fuel plants prematurely wastes sunk capital.

Every dollar the utility spent on subsidizing solar and connecting renewables to the grid was one less dollar available for strengthening equipment and removing combustible brush. Despite rising fire risk from non-native grass, Hawaiian Electric spent less than $245,000 on wildfire projects on the island of Maui between 2019 and 2022.

Unless they are compelled to by mandate and enforcement power companies will never pursue resilience. It doesn’t add to the bottom line and needing to spend more money on maintenance actually bolsters their case for higher rates. Whatever your views on government there are some things which require government action and more resilient power distribution is one of them.

At Reason.com Emma Camp worries that hundreds of thousands of students disappeared from U. S. schools during the COVID-19 lockdowns and have never returned:

During the first few months of the COVID-19 pandemic, a staggering number of students went “missing.” Kindergarten enrollment rates dropped, and students already enrolled in classes failed to log in for online learning.

From March to October 2020, the education nonprofit Bellwether estimated, as many as 3 million students nationwide went missing from classrooms. Another estimate from FutureEd, an education think tank, found a sevenfold increase in the number of students missing at least half a school year during the pandemic.

Once in-person school resumed, many students didn’t return to the classroom, nor did they register for homeschooling. No one knows exactly how to get them back.

According to the Associated Press (A.P.), California alone is missing more than 150,000 students, while New York is down nearly 60,000. In all, around 230,000 students in 21 states and Washington, D.C., are missing, which suggests that many more students are absent from classrooms nationwide. When the A.P. and Stanford University researchers analyzed data from pre-pandemic years, they found that almost no students were missing.

Where did the students go?

1. They’re being homeschooled
2. They’re truant
3. They’ve moved to other districts
4. They’ve left the United States
5. They never existed in the first place
6. All of the above
7. Other

I’m going for “All of the above”.

The irony of this post by Geoff Cooper at RealClearEnergy was not lost on me:

In the 15 years since the RFS was expanded, the amount of U.S. cropland has continued to shrink, grasslands and forests have increased, and the volume of animal feed grain and exports has risen—all while renewable fuel production has tripled.

How is that possible? Through innovation, greater productivity, and an unwavering commitment from American farmers and biofuel producers to use sustainable practices.

Farmers today grow nearly 20% more corn per acre than they did when the RFS was created. Thus, less land is required to produce the crops needed for renewable fuels. In 2022, farmers planted five million fewer corn acres (an area the size of New Jersey) than they did in 2007, but produced a corn crop that was 5% larger. Meanwhile, ethanol producers squeeze 10% more ethanol out of every bushel of corn than they did 15 years ago.

To me this illustrates that technological improvement is a two-edged sword, at least if your objective is to reduce carbon emissions. It doesn’t just result in better batteries; it also allows farmers to grow corn more efficiently.

That sounds like a good illustration of Jevons Paradox to me. Articulated more than a century ago, the paradox is that the more efficiently a resource is used (or produced) the more it will be used.

I had quite a bit of trouble in writing this post. To understand some of the problems I need to provide some definitions:

real means using constant dollars, taking inflation out of the picture
median means half are above and half are below
average or mean is determined by adding everything up and dividing by the number that you’ve summed
mode means the most frequently occurring number in whatever you’re counting
normal distribution means the median, mean, and mode are all the same
willingness to pay is a measure of demand

The problem that I had is that the figures I’m seeking are not readily available. What I was seeking was a graph of median college tuitions from 1970 to 2020 in real dollars. I’m going to need to use some anecdotal data.

This morning John Stossel’s op-ed in the New York Post, “Why college has become a total ripoff”, caught my eye. Naturally, he blames the high cost of a college education on the federal government:

It’s August. Many young people head off to college.

This year, fortunately, fewer will go.

I say “fortunately” because college is now an overpriced scam.

Overpriced because normal incentives to be frugal and make smart judgments about who should go to college were thrown out when the federal government took over granting student loans.

Why?

Because our government basically vomits money at everyone who applies.

If private lenders gave out the loans, they’d look at whether they were likely to be paid back.

I think that while government has played a role it’s not the only factor at work and I want to explain why. The TL;DR version is that college tuition has been rising very rapidly for a very long time, longer than the present round of student loans and (attempted) debt forgiveness.

I happen to know some of the following because I’m inquisitive and I talk to people. In 1960 the annual tuition at my elite alma mater was $600. By 1970 it had tripled to $1,800. It continued to triple roughly every 10 years: $5,400 (1980), $16,200 (1990), $48,600 (2000). Now it’s $62,391. Said another way over 60 years it increased more than a hundredfold.

Now let’s look at that in real terms:

Obviously, that’s a lot faster than inflation but inflation has played a role. It’s also clearly not just government action at work. If it had been, we’d see less regularity in the inexorable rise in inflation.

Now let’s look at real median family incomes over the same period:

Those are in 2021 dollars. Said another way in 2021 dollars the median family income was around $45,000 while today it’s around $89,000 dollars. Not quite doubled.

So, let’s recap. Inflation has rendered your dollar roughly equal to a dime in 1960. Median family incomes have roughly doubled. College tuitions have increased a hundredfold. Note that if median incomes had kept pace with inflation the median household income would be $450,000 today.

Here’s my interpretation of what’s happened. College tuitions have been increasing very rapidly for a very long time. That is driven by inflation and increased willingness to pay. Willingness to pay has increased become people have more money than they used to, because there’s a widespread and somewhat mistaken believe that the only way to get a good job is with a college education, as well as because the federal government has been throwing money at tertiary education. Basically, I think that John Stossel has the causality reversed. The government is throwing money at tertiary education because of voter demand and the increasing gap between college tuitions and median income.

I think that several things should happen. First, more strings should be attached to college loans. They should be restricted to majors that are likely to provide ROI. Second, we should deemphasize tertiary education in public discourse. It’s a lot less important than has been made out by opinionmakers. We need to reduce the role that the financial sector plays in the economy, referred to as “financialization”. And, finally, more policy should be directed at increasing median income. We can’t do that by increasing the number of workers in the country who can only get minimum (or sub-minimum) wage jobs. We need to produce more of what we consume.

I’m open to other suggestions. Increasing median income has been neglected for far too long.

I don’t intend to write about Trump’s latest indictment. There’s tons of commentary out there and I doubt I could write a balanced post without writing something that might be construed as a defense of Trump which I don’t care to do.

I’ll just make this observation. The last Republican to be elected president whom Democrats accepted as legitimately elected was George H. W. Bush in 1988. In general I think they should be very, very cautious about declaring “election denial” a criminal activity. It might come back to haunt them.

After my dad died well over half a century ago, the journal, a slender brown college notebook, that he wrote in during his trip to Europe in 1937-1938, sat on a workbench in our garage for decades. When my mom died which is now more than a decade ago it fell to me as co-executor of my mom’s will to sort, catalog, and distribute her voluminous personal possessions. To accomplish that I spent several days a week for several months going down to St. Louis, staying in her now-quiet house, sorting, cataloguing, and in many casees, photographing her things and placing them in numbered boxes for retrieval. I then organized their distribution among my siblings and myself.

The last place I tackled in my rather dolesome project was the garage. Up in the rafters of the garage I made a discovery. In a large moving box I found all sorts of things I had never seen before: correspondence, magazines, odds and ends from college, and, mirabile dictu, more of my dad’s journals. I immediately recognized what had happened. When my grandmother, my dad’s mother, had died the better part of a century ago, my dad dumped all of the stuff she had been keeping for him in the two-flat on Clayton Ave. that he owned and she lived in into a box and stored it in the garage of our house on Griefield Place. When we moved from Griefield Place to Ladue the box moved, too, to the rafters of our new garage. And there it remained until I disturbed its resting place 50 years later.

Clearly, what had happened is that my dad had filled up many of those old brown journals with his notes from his European trip and, when he filled one up, he sent it to his mother who kept it for him. So I now have quite a number of journals that I never knew existed.

Here’s an example of something I have. After Kristallnacht (November 9, 1938), which evoked an extremely cryptic and guarded notation from my dad, the U. S. Department of State inserted mimeographed flyers into the American Express boxes of all U. S. citizens, warning them to get the heck out of Europe. I have that flyer.

I’ve been putting off going through those journals because it will in all likelihood not be a pleasant task. No sort of preservation was done—they were just dumped unceremoniously into a box. They’re mildewed, covered with mouse droppings and insect casing, and generally disgusting. Additionally, my dad’s handwriting is not the easiest to decipher.

I think I should break down and preserve and transcribe those old journal immediately. After all neither they (nor I) are improving with age. I’m hoping that they hold some of the stories my dad told me: attending a Hitler rally, getting arrested as a German spy in Serbia, his bicycle chain breaking while cycling down an alp, etc. In his own words I mean.

This caption caught my eye in an article in Variety by Patrick Frater, “China Box Office Reaches All-Time Summer Record, With Minimal Help From Hollywood”. The short version is that the Chinese box office, completely unsurprisingly, prefers homegrown movies.

That should serve as a warning for Hollywood. As Stephen Follows documents, the average cost of making a Hollywood “summer blockbuster” has risen sharply over the years. Now it’s $100 million to $200 million. Reportedly, Barbie cost $145 million, Oppenheimer cost $100 million, the latest Indiana Jones installment $300 million, and Mission Impossible: Dead Reckoning $300 million. Add about the same for distribution and promotion to get an idea of what the picture needs to take in to break even. It should be obvious that these blockbusters can’t depend on domestic earnings alone and, indeed, they typically get about half their box offices from international distribution. But everybody wants their own domestic film industries to dominate their domestic (if not global) box offices.

If you eliminate China and India, the two biggest markets in the world, that imposes a high hurdle for Hollywood movies.

I honestly don’t know what’s going to happen but I don’t think it bodes well for the $1 billion Hollywood blockbuster which you can see looming on the horizon if you squint a little. I would prefer many more lower budget movies tailored for narrower primarily domestic audiences but I don’t believe that will happen. I also note that the coming reality should have some impact on the writers’ and actors’ strike that is presently going on but I doubt that it will.

First, watch the video above. Then consider the following observations by Katherine Blunt, Dan Frosch, and Jim Carlton in the Wall Street Journal:

During the 2019 wildfire season, one of the worst Maui had ever seen, Hawaiian Electric concluded that it needed to do far more to prevent its power lines from emitting sparks.

The utility examined California’s plans to reduce fires ignited by power lines, started flying drones over its territory and vowed to take steps to protect its equipment and its customers from the threat of fire.

Nearly four years later, the company has completed little such work. Between 2019 and 2022, it invested less than $245,000 on wildfire-specific projects on the island, regulatory filings show. It didn’t seek state approval to raise rates to pay for broad wildfire-safety improvements until 2022, and has yet to receive it.

Now, the company is facing scrutiny, litigation and a financial crisis over indications that its power lines might have played a role in igniting the deadliest U.S. wildfire in more than a century. The blaze has caused more than 100 deaths, destroyed the historic town of Lahaina and resulted in an estimated billions of dollars in damage.

I’m having difficulty in visualizing how residents of Hawaii will get along without electricity, Hawaiian Electric could be motivated to clean up its act, or socializing its power generation and distribution would resolve the problem. Also cf. “ComEd Four”.

In his latest column for the Wall Street Journal William Galston muses about whether the world has already seen “peak China”:

Long-term projections suggest that China’s population, which now stands at about 1.4 billion, will drop below one billion by 2080 and 800 million by 2100. China’s working-age population, which peaked in 2011, is projected to decline nearly a quarter by 2050. Meanwhile, the number of elderly Chinese will rise from 200 million to 500 million at midcentury, and providing for their needs will be a mounting challenge for China’s workers and policy makers.

While these demographic trends will cause issues in the future, current problems are challenging the playbook that China has used to maintain growth in recent decades—infrastructure development, housing production and exports.

Burdened by rising debt, local governments are finding it difficult to sustain their current pace of infrastructure investment. Meanwhile, China’s housing sector looks desperate. Dozens of developers have defaulted on bonds and other financial obligations in the past two years. Last week, Country Garden, one of China’s largest remaining developers, missed interest payments on debt with a face value of $1 billion, sending new shock waves through the sector. The monthly value of new home sales by China’s 100 largest property developers has fallen more than 80% since late 2020. Looking forward, annual housing demand is estimated at between nine million and 10 million units, well below the peak (much of it speculative) of 14 million purchases in 2021.

Let’s visualize China’s demographic situation a little more:

With the regular caveat that we’re working in the dark, relying on China’s reported population which may or may not be correct, I think that population pyramid is revealing.

The major change occurred about 30 years ago, I would assume due to a combination of the “One Child Policy” with China’s currency revision which led to the growth spurt that seems to have come to an end. Jobs became more available and lucrative, particularly for women of child-bearing age; children became an economic liability.

That will really begin to bite in about 30 years, i.e. around 2050. China’s dependency ratio will be unworkable with little way around it unless you’re willing to kill a lot of old people, a move that may prove difficult if there’s anything left of filial piety in that China. A relatively small number of working age Chinese will be trying to support a very large number of older Chinese.