Category Archives: USA

Today, capitalism came to space

Today at 9:44  the private company SpaceX launched the first commercial rocket that will carry goods up to the International Space Station. This opens a new chapter in our relationship to space.

I am not sure if I like this or not. On the one hand I think that if we want our exploration of space, and not least, our use of space to grow, we need more actors than the public agencies such as NASA, ESA and JAXA. On the other hand, for the foreseeable future it will be the tax payers who will pay the private companies for what they do (except for what happens on the satellite side, but that’s another story). Should we really use tax money to create private profit? NASA is paying SpaceX 1,6 billion USD for 12 trips to the Space Station.

Here is NASA’s video from the launch

I believe our future lies in constantly exploring new horizons.

“Go West, young man, go West. There is health in the country, and room away from our crowds of idlers and imbeciles.” “That,” I said, “is very frank advice, but it is medicine easier given than taken. It is a wide country, but I do not know just where to go.” “It is all room away from the pavements.”  Horace Greely said once (there is disagreement about who is the origin of the term Go West, young man, go West, some claim it comes from John Soule)

Greely’s advice was given in conjunction with drive to occupy the American West. This movement brought great suffering to the original people there, but let us look away from it for a moment and reflect upon where we now can go to build a better society for people.

I believe that at least some of the answer lies in space.

Low hanging fruit

Growth in the U.S. economy from the war and until the middle of the 70th century was based on the picking of three low hanging fruit. Now, the fruits are picked, and perhaps it is one of the reasons that there are so few jobs created in the United States.That, at least is the claim Tyler Cowen makes in his book “The Great Stagnation”

In the book he emphasises that the United States has had three major advantages. They have had a nearly free land, major technological breakthrough and smart uneducated youths. Now these resources fully exploites, and Cowen believes that there are few low hanging fruit in the future.

Cowen writes:

In a figurative sense, the American economy has enjoyed lots of low-hanging fruit since at least the seventeenth century, whether it be free land, lots of immigrant labor, or powerful new technologies. Yet during the last forty years, that low-hanging fruit started disappearing, and we started pretending it was still there. We have failed to recognize that we are at a technological plateau and the trees are more bare than we would like to think.

It is obvious that there is no more free productive land left in the USA. It is also understandable that after a while, as education level increases and more and more people are educated the productivity growth for each additional year of education is less and less. However, the most interesting in Cowen’s analysis is that he claims that we have reached a technological plateau, and that technology can no longer drive the economy. He says that the big leap is over. We all have electricity, running water, telephone and transportation. Exchanging a refrigerator of 60 liters for a 240-liters machine with ice cube fascilities is not a quantum leap, but a small improvement. It was something quite different when we first got the possibillity to freeze or keep our food cold.

He writes:

Across the years 1965 to 1989, employment in research and development doubled in the United States, tripled in West Germany and France, and quadrupled in Japan. Meanwhile, economic growth has slowed down in those same countries, and the number of patents from those countries has remained fairly steady. The United States produced more patents in 1966 (54,600) than in 1993 (53,200). “Patents per researcher” has been falling for most of the twentieth century.

By this, I believe, he means to say that despite the internet revolution, we have not seen new technologies that really changes the way we live. As he says, teleportation would change the way we live, an internet enabled car with GPS does not.

A lot of our recent innovations are “private goods” rather than “public s.” Contemporary innovation often takes the form of expanding positions of economic and political privilege, extracting resources from the government by lobbying, seeking the sometimes extreme protections of intellectual property laws, and producing goods that are exclusive or status related rather than universal, private rather than public; think twenty-five seasons of new, fall season Gucci handbags.


Keep in mind that median income growth has been slow, and stock prices—the valuation of capital—haven’t made lasting progress in a long time. As of the fall of 2010, the S&P 500 is more or less back where it had been in the mid-1990s. As economist Michael Mandel puts it, if neither labor nor capital is reaping much gain, can we really trust the productivity numbers


“Discovering who isn’t producing very much and firing them” has been the biggest productivity gain in the last few years.

This is exciting ideas to develop further. It is interesting how he takes issue with the Internet hype from the last few years.

Most Web activities do not generate jobs and revenue at the rate of technological breakthroughs. When Ford and General Motors were growing in the early part of the twentieth century, they created millions of jobs and helped build Detroit into a top-tier U.S. city. Today, Facebook creates a lot of voyeuristic pleasure, but the company doesn’t employ many people and hasn’t done much for Palo Alto; a lot of the “work” is performed more or less automatically by the software and the servers. You could say that the real work is done by its users, in their spare time and as a form of leisure. Web 2.0 is not filling government coffers or supporting many families, even though it’s been great for users, programmers, and some information technology specialists. Everyone on the Web has heard of Twitter, but as of Fall 2010, only about three hundred people work there. Let’s go down the list and look at the (approximate) employment figures for some of the top Web companies: Online Industry Employment Levels Google–20,000 Facebook–1,700+ eBay–16,400 Twitter–300

Now the numbers he uses does not including all the supporting industries that spring up around these internet companies, but there is no doubt that Google or Facebook is far from creating as many jobs as the old industrial companies did. At least as interesting that the fact that these companies do not earn so much money that tax revenues provide the ability to support a welfare state or to pay pensions to people who are not working. Of course, the Internet has a value beyond the purely monetary. You can read more about Cowen’s thoughts on it here. And I should also mention that he concludes the book with an optimistic belief that the internet and smart machines can still turn out to be the breakthrough that is helping to create new low hanging fruit

All this is of course very important for income and income distribution in society. This graph shows how the development has been in the United States.

Graph loaned from Wikipedia/User:Frichmon

Media income has risen much less than the growth in gross domestic product. Until about 1975 median income increased entirely in line with growth in GDP. So the change is after that time is significant. I also believe that this shows partly at least, why the extreeme right is dominating the economic discourse in the US. In a country without strong trade unions that can fight for equality, where the average man and woman do not see their own income grow while the richest only becomes richer, it is not surprising that tax relief is one of the most important political issues. In Norway, there have also been differences, but not nearly so great. From 1990 to 2007 the increase of the real value of median income after tax was 40 percent, while GDP rose by over 70 percent from 1990 to 2010

How should we interpret this in a Norwegian context?

Here we have also had great low hanging fruit that we have picked, perhaps the most important been an abundance of natural resources (oil, hydroelectric power and fish) and a strong increase in women’s labor force participation, as well as a big growth in education level. I think we’ve taken out most of the potential within the labor force participation and education. And we know that oil is going to end.

If we believe this analysis shows that the need to change from an oil-based economy to a different type of economy is urgent. If we do not,and do not find new low hanging fruit, there is great danger that we too can experience an economy that grows, but where there is not created employment and income for ordinary people.

We need to start the restructuring now, we should be ready with something new when the last sweet oilapple are picked.

The awfull feeling of being powerless

I watch TV and I read about what is happening in Gaza. And I get this overwhelming feeling of being powerless. Just sitting there watching kids die, watching Israel perpetrating this gross overuse of power. I wish I could be able to do something to make it stop, that my country and the international society together would do something to make Israel stop. Unfortunately Israel seems to be the holy grail of international politics and are allowed to do things we have gone to war to stop in other places. We attacked Serbia after events that were far less damaging than what happens in Gaza.

And, yes I now Hamas has been sending home made rockets into Israel. They are scaring, but the damage is small. Israel’s response is way out of proportion. More important, Israel’s is the occupying force. We may dislike the politics of Hamas, but they won an election and are running a perfect legitimate campaign against the occupier, not much different from what happened in many European countries that were occupied by Nazi-Germany under WWII. Why should the Palestinians have lesser right of resistance than we had?

There is no excuse for what Israel is doing just now, not morally and certainly not legally.

I would like to you a quote from the dailykos:

Like davidminzer, I’m Jewish and descendant of holocaust survivors. Moreover, I’ve been a Zionist all of my life. I went to a Zionist school, I was active in Zionist youth groups. I’ve always been a fervent supporter of Israel as a refuge for Jews around the world who seek a place to exercise their traditions and embrace their identity in peace.

I sang the Israeli anthem in the train rails of Aushwitz-Birkenau and I pledged to fight every day of my life to make sure the savage crimes that had taken place there would never happen again. Every year I pledged: Never Again. Remember and Never forget.

Well, I haven’t forgotten. And so to honor that pledge, to honor the memory of my family members who died in those death camps and because “there comes a time when silence is betrayal”, today I finally and publicly end my support for the state of Israel.

It is sad to see Israel repeating the sins of others.

There is only one way forward towards a lasting peace – as I see it – to states under the borders established in 1967. This means the dismantling of Jewish settlements in occupied territories, and it also means denying millions of Palestinians the right to return to the houses and the land they had to flee from in 1947/48 when Israel was established. It will be traumatising for both nations for sure. And so long Israel has been stopping all possibility of going there through allowing ever more settlements on occupied territory.

We need the world to stand together, we need the US to stand with the world and tell Israel in no uncertain terms that this is the solution the world will accept, and only if Israel empties the settlements will weapons and billions of dollars again flow into the country.

I was luckily able to attend a demonstrations today in support of Gaza. There is a friendship agreement between my city of Tromsø and Gaza. Now Gaza need friends

The Irish no – paid for by the United States?

Some media, including Der Spiegel and EUObserver reports that it was U.S. neokonservatives that paid for the Irish no-campaign.

Der Spiegel quoted the French Europe Minister Jean-Pierre Jouyet from a meeting in Lyon:

“Europe has powerful enemies on the other side of the Atlantic, gifted with considerable financial means.”


He was putting the blame for the Irish rejection of the Lisbon Treaty on some surprising shoulders: neoconservatives in the United States. “The role of the American neocons was very important in the victory of the ‘no,’” he said.

The starting point for discussion about this is that an organization with  the name Libertas spent some 1.3 million euros in the no campaign in Ireland. Twice as much as Fianna Fail used on the yes campaign. Speculation is based on the fact that the founder of Libertas also is director of Rivada Networks. This company sells trades a lot with the US millitary. Several of those who worked for Libertas was paid by Rivada. It is not public how Libertas got by their money. The Herald writes a little about the background of the founder of Libertas here. They put particular emphasis on that several former American millitary officers are on the Board of Rivada Networks. Speculations increased after some comments from John Bolton, former U.S. UN ambassador. According to Der Spiegel:

John Bolton, the former US ambassador to the United Nations, was in Dublin to deliver a speech on trans-Atlantic relations a week before the vote. He warned that the treaty could “undercut NATO,” something that would be a “huge mistake.” According to Bolton, known for being one of Washington’s most outspoken hawks, if the EU had its own military capability people will think NATO redundant and that Europeans “can take care of their own defense.”

It is not surprising that the European Parliament hungrily has embraced this matter – they seems to be far from ordinary people. Rather than discuss the reasons why people in Europe do not want an ever closer union and work to change the EU to something the people need and want, they use their time on conspiracies. My impression is that the EU parlamentarians are some of the most federal-minded people that are, and that they to a small degree understand why the EU is faced with so much opposition among people. In any case, EUObserver writes that:

The European Parliament’s delegation to the US will on its next trans-Atlantic visit ask Congress about allegations that the Irish anti-Lisbon Treaty campaign was funded out of America.

The parliament’s political group leaders – the “conference of presidents” – made the decision on Thursday (25 September) following calls for transparency by the Irish and French governments and the European Commission.

Daniel Cohn-Bendit, leader of the green group in the European Parliament expresses the rather strange reaction that many on the European left have; that the CIA is behind all that is evil in the world. The EUObserver quotes him on:

“The Irish press revealed that there possibly exists a link between the financers of the No campaign in Ireland and the Pentagon as well as the CIA … If proved true, this would clearly show that there are forces in the US willing to pay people to destabilise a strong and autonomous Europe,”

I think Cohn-Bendit and others have much more to gain from working to make the EU more democratic and less federal than to use their time on the search for U.S. supported conspiracies

The Arctic is heating up

No, I’m not talking about climate change. Even though I obviously could have, the North West passage is open again this year. No, I’m talking about the international scramble to grab land (read sea bottom) in the Arctic.

The United Nations Law of the Sea gives all the countries around the Arctic bassin until 2014 to stake their claim or earlier if they ratified before 2004. This means we are in for a rush of claims. Norway has already submitted her claim, Russia, Canada and Denmark (Greenland)are ready to do so. What the US will do is uncertain. The US has not ratified the Law of the Sea treaty, while the other countries have.

There is litle doubt that some of the claims will overlap. Certainly more than one country will claim the pole. Russia surely has made her intent clear by planting a flag on the north pole.
With the ice disappearing and the US Geological services claiming that large reserves of petroleum is to be found, there is reason to believe conflict will be many and tough. Lets just hope they do not escalate. writes:

In the latest sign of the rising international political stakes in the Arctic, the top U.S. Coast Guard official has revealed a planned shift in American foreign policy from scientific research to “sovereignty” and “security presence” in Alaskan waters bordering Canadian and Russian


“The primary mission right now is the maritime boundary line with Russia – keeping foreigners from stealing Alaskan fish,” Rear Admiral. Gene Brooks, head of the U.S. Coast Guard’s operations in Alaska, told the radio network.


…prompted the Conservative government to promise a new year-round icebreaker for Arctic waters and a fleet of up to eight ice-reinforced patrol boats.

But we should be careful not to look at this potential conflict with old cold war glasses. The potential disputes between Canada and the US, Canada and Denmark are equal poignant as the potential conflict between all the Arctic countries and Russia.

However the Telegraph writes that:

As the polar powers have got out their maps in the last couple of years, four of them – Norway, Denmark, Canada, and the USA – have made the unpleasant discovery that the fifth – Russia – is far ahead of the game. As Russian forces consolidate their grip on her messy southern frontier in the aftermath of the war with Georgia, her diplomats, oilmen and military have been pressing their advantage in the north, a border region which is on a far vaster scale but equally confused and disputed.

Cleo Paskal, an Assistant Fellow at Chatham House and an expert on how climate change will affect borders, said: “The Russians have a big head start. Their nuclear submarines have been all over the Arctic for decades, they have 16 icebreaking ships to the Americans’ four, they have a lot of experience and a lot of the right gear.

So as all countries are beefing up their military capabilities in the Arctic, lets just hope the dispute settlement mechanisms in the Law of the Sea treaty will be robust – and enough.