January 10, 2009

Hot, Flat and Crowded – Thomas L. Friedman.

Hot, Flat and Crowded – Thomas L. Friedman. [Wonderful book on green enegery - I read it in single stretch.]

After reading this book, I think the title of the book is not appropriate, it should be wonderful if it says – from ‘Code Red to Code Green’ – as mentioned many times in the book and mainly on “Green Energy and how to make it green”.

I like the first few chapters, which are very informative, compared to the later portion of the book.

Where Bird’s don’t fly.

Talks about the US consulate in Istanbul, which was headquartered in Palazzo Corpi, a grand and distinctive old building in the heart of the city’s bustling business district. As part of security upgrade due to 9/11 incident, it was decided to close the consulate at Palazzo Corpi and built new one at a remote area with high-secured architecture (they could have filmed the Turkish prison movie ‘Midnight express thereJ). It was so well guarded they don’t even let birds fly.

Because a place where birds don’t fly is a place where people don’t mix, ideas get sparked, friendship don’t get forged, stereotypes doesn’t get broken, collaboration does not happen, trust does not get built, and freedom doesn’t ring. That is not the place we want America to be. It cannot play the vital role it has long played for the rest of the world – as a beacon of hope and the country that can always be counted on to lead the world in response to whatever is the most important challenge of the day. We need that America more than ever today.

This is a book about why.

World has problems. World is getting hot flat and crowded. That is global warning, the stunning rise of middle classes all over the world and rapid population growth have converged in a way that could make our planet dangerously unstable.

The simple name for the new project I am proposing is ‘Code Green’.

Americans intuit that we’re on the wrong track and that we need a course correction and fast. In the Italian film, ‘The leopard’ Prince Salina is bitter ad uncompromising – “ We were the leopards, the lions; those who take our place will be jackals and sheep”. The wisest advice he gets comes from his nephew Tancerdi who marries a wealthy shopkeeper’s daughter from the new moneyed middle class and along the way cautions his uncle – “ If we want things to stay as they are, things will have to change”.

One disturbing trend: Post –9/11, we as a nation have put up more walls than ever and in the process we have disconnected ourselves emotionally, if not physically, from many of our natural allies and our natural instincts to embrace the world.

The other disturbing trend has been building slowly since the 1980s. It is a ‘dump as we wanna be’ mood that has overtaken our political elite, a mood that says we can indulge in pretty red state – blue state fights for as long as we want. The prevailing attitude on so many key issues in Washington today is “ We’ll get to it when we feel like getting to it and it will never catch up to us, because we are America.

(The proposal of both McCain and Clinton during 2008 election, to suspend the federal tax on gasoline, was the epitome of ‘dumb as we wanna be’ politics.).

Our youth people are so much more idealistic than we deserve them to be and they want our country to matter again, they want to be summoned, not just to do nation-building in Iraq or Afghanistan, but to do nation-building in America – to restore and revitalize something they cherish but feel is being degraded.

Well-known Indian author – Gurucharan Das- has been forced by border security control agents to explain why he was visiting. They “make you feel so wanted now and that was always reinventing itself.”; he added, because it was a country that always welcomed ‘all kinds of oddballs’ and had this wonderful spirit of openness”. American openness has always been as inspirations for the whole world, he told me. “If you go dark, the world goes dark.”

In Dec. 2007, I was visiting Bahrain and we (author and Crown Prince Salman) were at a bistro having pizza where Salman mentioned about the American school which was opened for American military dependants while nearly 70% were tuition-paying non-Americans primarily the sons and daughters of Bahrain’s business and political elite, including the crown prince of his day. Added Crown Prince Salman: “ The American school was the best advertisement the Americans ever had. It made more friends than the American embassy”.

[The book goes into great details on failure of previous administration on finding alternate energy to petrol. He blasts Regan administration for not continuing Carter’s alternate-energy initiative. Not only American became heavily depended on Middle East, but also put earth into dangerously hot. Our new fuel economy standard up to 35 miles per gallon by 2020, roughly where Europe and Japan are already today.]

European government imposed heavy tax on gasoline and taxes on engines size and kept imposing them and hence European customers demanded smaller and smaller cars. In US, Detroit companies introduced the SUV and successfully lobbied the government to label these as light trucks so they would not have to meet the 27.5mpg needed for standard cars.

David Rothkopf, an energy expert “ Green is not simply a new form of generating electric power, it is a new form of generating national power.”

As per ideafinder.com (another good site mentioned infoplease.com) , the first automobile to be produced in quantity was the 1901 Curved Dash Oldsmobile which was built in US by Ransom E. Olds. Modern automatic mass production and its use of the modern industrial assembly line is credited to Henry Ford (Model T car).

[Book again goes in detail on countries that benefited from huge petroleum price and used that money for anti-American activities. It is equally interesting and alarming to find how some nations controlling the culture of other poor countries in that process. Fall of Soviet is related the fall of oil price from $70 per barrel in 1970s to $10 in 1980s.

Saudi Arabia hiked their oil production 4 times which resulted in brining down the oil price to $10 which put USSR in jeopardy as it could not continue to provide subsidy to people and allies.

For democracy to rule in other parts, it would be faster, if the oil price is around $10 per barrel as per the author; including normalization of muscle power exhibited by Russia & Venezuela].

“Does oil hinder democracy’ by Michael L. Ross a UCLA political scientist demonstrates this point with many examples from history. The motto of the American Revolution was “No taxation without representation”. The motto of the petro-list authoritarian state is “ No taxation, so no representation either “. When oil price became higher, the reforms became slower.

Up until 9/11, America treated the Arab world basically as a collection of big gas stations – the Saudi station, the Libyan station, the Kuwait station. “Guys” we told them – it was only guys we talked to – “here is the deal. Keep your pumps open, keep your price low, and don’t bother the Jews too much, and you can do whatever you want out back. You can treat your women badly. You can deprive your people of whatever civil rights you like. You can print whatever crazy conspiracy theories about us you like. You can educate preach from your mosques any venom that you care to….

The person who best described the critical importance that relative price play in stimulating innovation in renewable energy was none other than the late great Saudi Arabian oil minister Sheikh Ahmed Zaki Yamani. Back in the 70s as OPEC was just starting to feel its oats, Yamani used to warn his colleagues not to raise oil prices too high, too fast, for fear of causing a government and market reaction in the West that would trigger massive innovation in wind, solar and other forms of the renewable energy.

He mentioned, “Remember boys, the Stone Age didn’t end because we ran out of stones”. It ended because people invented alternative tools made of bronze and then iron.

Yamani knew that the price signal – the price of oil versus the price of renewable- was everything. And OPEC needed to keep its crude prices exactly at the level where the cartel could earn the maximum returns without spurring the West to innovate any scale alternate to oil.

Our goal needs to be to make Yamani’s nightmare true.

Author’s favorite passage in Prince goes like this. “It ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct or more uncertain in its success than to take the lead in introducing a new order of things, because the innovator has for enemies all those who have done well under old conditions, and lukewarm defenders in those who may do well under the new. This coolness arises partly from fear of the opponents – who have the laws in their side – and partly from the incredulity of men who do not readily believe in new things until they have had a long experience of them”.

Tx n Rd

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