The Worst of Times . . . The Best of Times
Lakshmi Mittal put everyone’s heart in their throats yesterday with the announcement that ArcelorMittal would cut production by 35% in response to a dramatic slowdown in Europe over the last two weeks.
The WSJ covers it here.
That’s the kind of news that puts flesh on the fears created by the credit crisis. What happened to all of that building in emerging markets? Will steel prices fall to the cost of production and kick many producers into bankruptcy? Mittal tried to sound measured by saying, “I hope that this is already at the worst point.”
Maybe the infrastructure buildout won’t be able to do any more than substitute for all of the lost auto production and the halt in building. But steel isn’t the only infrastructure play. Buried in the NY Times is this Steve Lohr story about an announcement IBM’s CEO Sam Palmisano is making today at the Council on Foreign Relations. According to the Times, Palmisano is:
“proposing a technology-fueled economic recovery plan that calls for public and private investment in more efficient systems for utility grids, traffic management, food distribution, water conservation and health care. Recent technology advances make this possible, and the need is apparent, Mr. Palmisano will say [ . . . ] . Sixty-seven percent of electrical energy, for example, is lost because of inefficient power generation and grid management. Congested highways cost $78 billion a year in squandered working hours and gas burned. [ . . . ] I.B.M. is increasingly playing the role of lead contractor in these so-called smart infrastructure projects around the world, from a traffic management network in Stockholm to electric grids in Texas.
Some economists and policy experts say similar projects are a good way to improve the long-term health of the economy, potentially providing a foundation for innovation and growth across a range of industries.
Applying more computing intelligence to help transform fields like transportation, energy and health care will be “critical to solving an array of pressing public problems,” said Robert Atkinson, president of the Information Technology and Innovation Foundation, a nonpartisan research group. [ . . . ]“
It’s self-serving, sure. But building a more effective and efficient infrastructure, especially an energy infrastructure, is a much better investment than propping up the auto industry. As for IBM, isn’t doing
well while doing good what we want out of the recover.
November 7th, 2008 at 9:14 am
Unless IBM can change the laws of physics most of that lost electrical power is gone forever. It is resistive loss in the power lines, turned into heat. Ohms Law.
Room temp superconductors would solve this problem, though the cables would need to be replaced. A small 1km superconducting line is now in service in Manhattan.
November 7th, 2008 at 10:36 am
schmitt,
that’s a nice read on this: “Sixty-seven percent of electrical energy, for example, is lost because of inefficient power generation and grid management”
taken verbatim, he isn’t talking about massively distributed micro-generation facilities, he’s talking a hard-core “technocracy” overlay on an, inherently, inefficient system/schema..
“The more things change…” “Meet the New Boss…”
Sadly, there are Real Answers, using, currently, available Technology, that would Radically improve our resource-use efficiency, but, that “Change” needs to come, as always, from the bottom, up. We can “Hope” that it’ll come from the top, down, though, we already know how that works out..