Category Archives: Economics

Posted on by

Credentialed media are finally starting to see the problems with plug-in electric vehicles Of course, they solve that problem by not letting the plebeians have cars!

I’ve been saying this for a long time now: plug-in electric vehicles will be a nightmare for people without a garage or dedicated parking space. Now the credentialed media are noticing as well:

Extension cords across sidewalks: Charging an electric vehicle in Philly is a challenge

Electric vehicle owners without dedicated parking spaces stretch wires, and the limits of legal codes, to keep their EVs charged.

by Andrew Maykuth | Thursday, October 13, 2022

Anthony Wong and Robert Berkowitz waited several years for a back-ordered Tesla, the popular electric vehicle brand. By the time the new car was delivered in 2018, Philadelphia had canceled its controversial program to set aside curbside parking spots for EVs. That left the Bella Vista residents with few options for charging their new Tesla at home.

Like many urban EV owners without off-street parking, Wong and Berkowitz improvised. They’re retired and say they have more time to charge the Tesla’s battery at public charging stations at such destinations as stores or casinos.

“If we drove the car every day for work, then we might need to charge overnight to keep the car going,” Wong said.

But sometimes they need to charge their car at home. Their solution: Run a cable out the second-floor window of their rowhouse to their car parked in the street. They prop the cable atop a street sign to allow pedestrians to pass underneath. “It’s not really that noticeable, and it’s not in somebody’s way,” Wong said.

While it is, perhaps, not in anybody’s way, it’s also not legal, though nobody has been enforcing that law.

Philadelphia had a short-lived program which allowed electric vehicle owners to get a reserved EV parking space in front of their homes, but neighbors quickly complained that this was an undeserved perquisite for EV owners, the vast majority of whom were financially well off. The Inquirer reported that only 68 of these spaces were created before the program was canceled. And here’s the clincher:

After the city abandoned its EV parking program, a task force recommended that the city encourage the use of mass transit and the buildout of public charging stations rather than use its scarce resources to support private electric vehicles.

“In the grand scheme of sustainable transportation priorities, personal vehicles are still kind of low in the hierarchy in terms of what we want to be encouraging people to do,” said Christine Knapp, the city’s former sustainability director. “I don’t think anyone’s vision of a truly sustainable city 30 years from now is that we have the same number of cars on the road as we do now, but they’re running on electricity instead of gas.”

Philadelphia Badlands. Photo via Philadelphia Inquirer Click to enlarge.

Our Betters, you see, don’t want the peons to have their own vehicles, but to be packed on Southeastern Pennsylvania Transit Authority buses and trains, to SEPTA stations filled with litter and used needles, drug addicts getting high, homeless people sheltering there, and a rising crime rate. We have previously noted the Allegheny Avenue SEPTA station in Kensington, with its open-air drug markets, which the city and Philadelphia Police are simply ignoring.

Christine Knapp, I would guess, doesn’t live in the Philadelphia Badlands, so notorious that it was once actually a part of Google Maps, though later removed, removed for telling a politically incorrect truth. She probably doesn’t have to take the SEPTA 30th Street Station, not near Kensington, but Drexel University.

Philadelphia is a rowhouse city, filled with working-class neighborhoods built a hundred years ago, with little in the way of parking. The Patricians have it a bit better than the plebeians, with parking garages for Center City high rise condos, and single-family homes with private driveways and garages in Chestnut Hill. They’ll have their dedicated parking spaces with protected charging stations, so they can advocate electric cars.

The rest of the people? Too bad, so sad, must suck to be them!

Posted on by

No surprise: fuel prices are beginning to rise again

We noted, on Wednesday, October 5th, that very much contrary to President Joe Biden’s wishes, Russia and Saudi Arabia pushed OPEC+ to set a reduction in petroleum production of 2,000,000 barrels per day:

Saudi Arabia and Russia, acting as leaders of the OPEC Plus energy cartel, agreed on Wednesday to their biggest production cuts in more than two years in a bid to raise prices, countering efforts by the United States and Europe to choke off the enormous revenue that Moscow reaps from the sale of crude.

President Biden and European leaders have urged more oil production to ease gasoline prices and punish Moscow for its aggression in Ukraine. Russia has been accused of using energy as a weapon against countries opposing its invasion of Ukraine, and the optics of the decision could not be missed.

“This is completely not what the White House wants, and it is exactly what Russia wants,” said Bill Farren-Price, the head of macro oil and gas analysis at Enverus, a research firm. It also puts Saudi Arabia on a diplomatic “collision course” with the United States, he said.

The cut of two million barrels a day represents about 2 percent of global oil production.

Karine Jean-Pierre, the White House press secretary, told reporters that the decision was a “mistake and misguided. “It’s clear that OPEC Plus is aligning with Russia with today’s announcement,” she said.

The United States is hardly a nation President Vladimir Putin wants to please: the US continues to send money and war materiel to Ukraine, which is directly at war with Russia, so the US is, in effect, engaged in a proxy war with Russia. Maybe, just maybe, Vladimir Vladimirovich isn’t in any mood to do favors for Mr Biden.

And, of course, Mr Biden directly accused Saudi Crown Prince of ordering the murder of Jamal Khashoggi, and called teh Crown Prince a liar for denying it. Could it possibly be that the de facto ruler of the world’s largest petroleum exporter is not really inclined to be nice to our President?

Well, now the effects of the OPEC+ decision are becoming known:

Why gas prices are going back up after nearly 100 days of declines

by Rob Wile | Monday, October 10, 2022

It was the longest losing streak for gasoline prices since the early months of the pandemic: For 98-consecutive days this summer, American drivers experienced declining gas prices thanks in part to a slower worldwide demand for oil.

Now, a cut in oil production signaled by the OPEC+ group last week has sent global crude prices higher, bringing upward pressure back to prices at the pump.

According to AAA, the national average gas price climbed to $3.92 a gallon Monday.

Prices are likely to keep going higher from here as oil prices continue to climb, according to Patrick De Haan, chief petroleum analyst at gas price tracking group GasBuddy.com.

“With OPEC+ deciding to cut oil production by two million barrels a day, we’ve seen oil prices surge 20%, which is the primary factor in the national average rising for the third straight week,” he said in a blog post Monday.

For the rest of the country, De Haan said he expects prices to rise as much as $0.30 from their September lows, which would put them at around $4 a gallon.

It’s not all peaches and cream in OPEC+: as The Wall Street Journal reported, Iraq is concerned that it cannot afford the mandated production cuts, but that’s somewhat counterbalanced by a strike among Iranian oil workers. That does mean that projections that gasoline will reach into the $4.00+ per gallon range a bit more guesswork than straight statistical modeling.

The most important point? The election is in 29 days.

Posted on by

This year’s “October surprise” As Joe Biden tries to lower inflation, his actions have pushed OPEC to increase prices

In his efforts to dial down the inflation rate, one would think that President Joe Biden wouldn’t want to see OPEC cut oil production, decreasing petroleum supplies and thereby increasing prices. But perhaps Mr Biden’s actions have had precisely the opposite effect. From The New York Times:

In Rebuke to West, OPEC and Russia Aim to Raise Oil Prices With Big Supply Cut

by Stanley Reed | Wednesday, October 5, 2022 | Updated 3:42 PM EDT

Saudi Arabia and Russia, acting as leaders of the OPEC Plus energy cartel, agreed on Wednesday to their biggest production cuts in more than two years in a bid to raise prices, countering efforts by the United States and Europe to choke off the enormous revenue that Moscow reaps from the sale of crude.

President Biden and European leaders have urged more oil production to ease gasoline prices and punish Moscow for its aggression in Ukraine. Russia has been accused of using energy as a weapon against countries opposing its invasion of Ukraine, and the optics of the decision could not be missed.

“This is completely not what the White House wants, and it is exactly what Russia wants,” said Bill Farren-Price, the head of macro oil and gas analysis at Enverus, a research firm. It also puts Saudi Arabia on a diplomatic “collision course” with the United States, he said.

The cut of two million barrels a day represents about 2 percent of global oil production.

Karine Jean-Pierre, the White House press secretary, told reporters that the decision was a “mistake and misguided. “It’s clear that OPEC Plus is aligning with Russia with today’s announcement,” she said.

There’s more at the original.

As The Wall Street Journal reported, the stop-gap emergency funding bill to avoid a government shutdown included some major funding for Ukraine:

The stopgap legislation included several provisions beyond funding the federal government’s current operations.

The resolution contains more than $12 billion in aid to Ukraine to help fortify the country’s military with new weapons and support the government in Kyiv as it fights off Russia’s invasion.

That aid includes $3 billion for training, equipment, weapons and other support—such as salaries and stipends—for Ukraine’s military and security forces, and $4.5 billion in budgetary support for Ukrainian government operations. It also dedicates $1.5 billion to replenishing U.S. military stockpiles and those of foreign allies who sent supplies to Ukraine at the request of the U.S.; it also includes $540 million to increase production of critical munitions and $2.8 billion to bolster Defense Department operations in support of Ukraine.

So, in trying to prevent Russia from forcing the price of crude oil higher, President Biden and the United States government will continue to send money to the nation with which Russia is at war. Perhaps, just perhaps, that isn’t the best way to get Vladimir Vladimirovich to pay attention to what the United States wants.

Of course, it wasn’t just Russia pushing for the production cut; Saudi Arabia was as well. From The New York Times again:

Biden Says He Told Saudi Prince He Blames Him for Khashoggi Murder

by Peter Baker | Friday, July 15, 2022 | Updated: Monday, July 18, 2022

President Biden said Friday night that he brought up the murder of Jamal Khashoggi during his closed-door meeting with Crown Prince Mohammed bin Salman and told the prince that he considered him to blame.

While Mr. Biden said nothing about Mr. Khashoggi during the public part of his meeting with the crown prince, he told reporters afterward that he considered the killing “outrageous” and directly confronted Prince Mohammed, who was judged responsible by the C.I.A. for the assassination carried out in Istanbul by a team of Saudi operatives in 2018.

“I raised it at the top of the meeting, making clear what I thought at the time and what I think of it now,” Mr. Biden said. “I was straightforward and direct in discussing it. I made my view crystal clear. I said very straightforwardly for an American president to be silent on an issue of human rights is inconsistent with who we are and who I am. I always stand up for our values.”

He reported that Prince Mohammed, often known by his initials M.B.S., denied culpability.

“He basically said that he was not personally responsible for it,” Mr. Biden said. “I indicated that I thought he was.” . . . .

Mr. Khashoggi was a Saudi contributor to The Washington Post who was critical of the prince’s rule. After his killing, Mr. Biden had said he would make Saudi Arabia a “pariah,” but aides say world events have left him little choice but to deal with the kingdom.

Asked about that remark on Friday, he said, “I don’t regret anything I said.”

But Mr. Biden’s decision to meet with the crown prince left human rights activists and Mr. Khashoggi’s family outraged. Hatice Cengiz, his fiancée, tweeted what she said Mr. Khashoggi would have thought: “Is this the accountability you promised for my murder? The blood of MBS’s next victims is on your hands.”

Mohammed bin Salman, the Crown Prince, was already the de facto ruler of Saudi Arabia, and his father, King Salman bin Abdulaziz, 86, just appointed him Prime Minister as well.

So, the two nations which have been the number one and number two petroleum exporting nations, and the two nations which lead and drive OPEC, are the two nations President Biden has decided he’s going to piss off. So, when Karine Jean-Pierre, the White House press secretary, told reporters that the decision was a “mistake and misguided,” and that, “It’s clear that OPEC Plus is aligning with Russia with today’s announcement,” perhaps, just perhaps she might have noted that her boss helped to give Russia and Saudi Arabia a common cause.

Full disclosure: I have been very opposed to the United States and NATO providing military aid to Ukraine. Not only did Ukraine decide to decline NATO membership previously, but the idea that we are fighting a proxy war with Russia directly, with a nation which has a strategic nuclear arsenal easily capable of destroying the United States and Europe, strikes me as utter madness. President Putin is, in some reports — though who can really know what to believe here — thinking very much differently than a Western leader would only means that he could, though not necessarily would, think very differently than we would about the use of tactical nuclear weapons against Ukrainian troop concentrations, and once the nuclear threshold is crossed, all bets are off. No, I do not want Russia to win its war of aggression against Ukraine, but I don’t want it so badly that I’m willing to risk a nuclear war to prevent it.

Now, Mr Putin is using one of the weapons he does have, a weapon to raise oil prices around the world, just as the northern hemisphere has exited summer and is heading toward winter. This year’s “October surprise,” just a month before the congressional elections, will just take more money out of the pockets of working Americans. And now you know why I call him the dummkopf from Delaware.

Posted on by

Now Our Betters want you to charge your Chevy Dolt at work, not a home. That's going to cost you more money.

A 2019 Chevy Bolt electric vehicle caught fire at a home in Cherokee County, Georgia, on Sept. 13. Source: Cherokee County Fire Department. Click to enlarge.

Perhaps I am stepping on William Teach’s toes with this one, but when this article appeared in my Google feed, it was too much of an opportunity on which to pass. I did check first to make sure Mr Teach hadn’t already written on the subject! From Stanford University:

Charging cars at home at night is not the way to go, Stanford study finds

The move to electric vehicles will result in large costs for generating, transmitting, and storing more power. Shifting current EV charging from home to work and night to day could cut costs and help the grid, according to a new Stanford study.

by Mark Golden | Thursday, September 22, 2022

The vast majority of electric vehicle owners charge their cars at home in the evening or overnight. We’re doing it wrong, according to a new Stanford study.

In March, the research team published a paper on a model they created for charging demand that can be applied to an array of populations and other factors. In the new study, published Sept. 22 in Nature Energy, they applied their model to the whole of the Western United States and examined the stress the region’s electric grid will come under by 2035 from growing EV ownership. In a little over a decade, they found, rapid EV growth alone could increase peak electricity demand by up to 25%, assuming a continued dominance of residential, nighttime charging.

To limit the high costs of all that new capacity for generating and storing electricity, the researchers say, drivers should move to daytime charging at work or public charging stations, which would also reduce greenhouse gas emissions. This finding has policy and investment implications for the region and its utilities, especially since California moved in late August to ban sales of gasoline-powered cars and light trucks starting in 2035.

“We encourage policymakers to consider utility rates that encourage day charging and incentivize investment in charging infrastructure to shift drivers from home to work for charging,” said the study’s co-senior author, Ram Rajagopal, an associate professor of civil and environmental engineering at Stanford.

There’s more at the original, and there’s no paywall to stymie you.

The authors believe that people should charge their Teslas and Chevy Dolts at work, rather than at home. Great idea, except there is no guarantee that your employer is going to add the infrastructure, and if he does, he’s going to need to recoup that cost: he’s going to charge employees for using the at-work charging stations, for both the installation costs and the sparktricity used.

One of the problems is the extreme egocentrism of the authors. It’s far too easy for people to think of their situations as the only situations. When they have an assigned parking space at a prestigious university, they might not consider that far more people work at places like Seven/Eleven, where management isn’t likely to run the power lines and install the stations for their minimum wage employees — who can’t afford a plug-in electric vehicle in the first place — to use. Perhaps they are unfamiliar with trades employees, who go to different jobsites across their area.

Once 50% of cars on the road are powered by electricity in the Western U.S. – of which about half the population lives in California – more than 5.4 gigawatts of energy storage would be needed if charging habits follow their current course. That’s the capacity equivalent of 5 large nuclear power reactors. A big shift to charging at work instead of home would reduce the storage needed for EVs to 4.2 gigawatts.

Storage capacity is a huge issue: solar plants generate exactly zero electricity at night, which means that charging your plug-in electric car after you get home from work means that most of the charging will be done after sundown. That means you will be drawing power not from the hundred-acre solar farm, but from the batteries to store the electricity the solar farm generated during the day.

More, electricity generated and going into the battery system before going to your home is less efficient than going from the solar plant directly to your home; there is increased energy loss due to the second stop.

Another issue with electricity pricing design is charging commercial and industrial customers big fees based on their peak electricity use. This can disincentivize employers from installing chargers, especially once half or more of their employees have EVs. The research team compared several scenarios of charging infrastructure availability, along with several different residential time-of-use rates and commercial demand charges. Some rate changes made the situation at the grid level worse, while others improved it. Nevertheless, a scenario of having charging infrastructure that encourages more daytime charging and less home charging provided the biggest benefits, the study found.

It also means that charging your car at work means that you will be paying not the residential power rate, which normally drops after 11:00 PM, but the commercial rate your employer is paying. It will cost you more to charge at work than at home, not even counting the charges the employer will have to put in place to pay for the employee charging stations.

It seems as though the global warming climate change emergency activists all had this great idea, that everyone should drive a plug-in electric car — excluding, of course, the activists who don’t think people should have privately owned vehicles in the first place — but they never really thought through the problems.

Posted on by

This morning’s rant

At length I remembered the last resort of a great princess who, when told that the peasants had no bread, replied: “Then let them eat brioches.“

— Jean-Jacques Rousseau, Confessions

My good friend and sometimes blog pinch-hitter William Teach pointed me to this article from Nicholas Goldberg in The Los Angeles Times, which can also be found on Yahoo! News to get around the Times paywall:

Americans don’t care about climate change. Here’s how to wake them up

by Nicholas Goldberg | Thursday, September 22, 2022 | 6:00 AM PDT

Why is the greatest threat to the planet of so little concern to most Americans?

It’s shocking, frankly, that global warming ranks 24th on a list of 29 issues that voters say they’ll think about when deciding whom to vote for in November, according to the Yale Program on Climate Change Communication. Only 30% of voters say they are “very worried” about it and more than two-thirds say they “rarely” or “never” discuss the issue with family or friends.

Actually, some of us see the United States and democratic Europe so willing to engage in a proxy war with Russia, a nation with a strategic nuclear arsenal, with seemingly little thought as to what could happen, as “the greatest threat to the planet”.

How can people be so blithely unconcerned when the clear consensus of scientists is that climate disruption is reaching crisis levels and will result not only in more raging storms, droughts, wildfires and heat waves, but very possibly in famine, mass migration, collapsing economies and war?

Uhhh, with a year-over-year 8.3% inflation rate in August of 2022, on top of August 2021’s year-over-year inflation rate of 5.3%, perhaps Americans are more worried about “collapsing economies” today than they are about such “crisis levels” in fifty or eight years?

Sure, there are some obvious reasons for the apathy: High among them is that fossil fuel companies have spent decades pulling the wool over the eyes of Americans. And Republican politicians have been complicit.

Well, of course it’s all the fault of evil, reich-wing Republicans and greedy fossil fuel companies! But Mr Goldberg, an associate editor and OpEd columnist for the Los Angeles Times, as well as the formerly being the newspaper’s editorial page editor, then changes his theme, and goes strongly toward a more marketing approach to persuade people to get worried about global warming climate change emergency. After pointing out what he sees as the activists’ naïveté in ignoring marketing techniques, he tells us that the only way to sell the activists’ ideas is to consider those who are not already on their side that people are stupid:

Deliver simple messages, for one thing. In general, climate activists lean toward complexity and nuance because they don’t want to patronize or condescend or mislead by oversimplifying to their audiences.

Once you have a simple message, repeat it over and over. Did you know that consumers generally have to see an ad more than half a dozen times before they will be persuaded to buy a product?

Embed facts and data in what (David) Fenton calls “moral stories that tug at the emotions.” Anyone who has ever watched TV ads knows that strategy can make arguments far more powerful.

Talk about what people care about. There’s been too much talk about the effect of climate change on polar bears, and not enough on what it means for humans.

Use language people understand. Research shows, Fenton says, that many people don’t understand the phrases “existential threat” or “net zero” or “climate justice.” They understand what “pollution” is, but not what an “emission” is — which suggests that it might make more sense to use the former term.

That practically drips with condescension: Mr Goldberg is saying that those who aren’t already on the side of the global warming climate change emergency activists just can’t understand.

Still, at the end, he throws at least a little bit of concern that people will have to make “sacrifices”:

Is (Mr Fenton) right when he says the climate problem can be solved in a way that enhances economic prosperity? I hope so; that’d be great. But I worry — and this is just my opinion, not an expert’s analysis — that we’ve waited too long, and that to avoid the worst effects of climate change we are going to have to sacrifice, whether it sells or not. I take the gloomy approach.

Either way, we can all agree there’s an awful lot to be done. And Fenton is certainly right that you can’t mobilize people for war if they don’t know they’re under attack. Public education is obviously a missing piece of the puzzle.

Somehow we need to awaken a nation of sleeping, underinformed and insufficiently motivated citizens and persuade them to rise to the great challenge of modern times. To do that, the unmanipulation process needs to begin in earnest.

Apparently, for Mr Goldberg, those who do not support the global warming climate change emergency activists are victims of ‘manipulation’ by fossil-fuel companies and wicked conservatives, but it’s “unmanipulation” to market to people his ideas.

With a guesstimated annual salary of $88,663, and net worth of $845,000, and a wife, Amy Wilentz — who didn’t respect her husband enough to take his name — who earns a similar salary from The Nation as well as being an English Professor at the University of California at Irvine, perhaps the distinguished Mr Goldberg doesn’t truly understand that working-class Americans might be more concerned with paying the rent, keeping the electricity turned on, and food on the table now than they are in projections of doom fifty and eighty years in the future. With the high inflation rate, with which wage increases have not matched, Americans are poorer, in real terms, than they were two years ago.

Then they read what the global warming climate change emergency activists want to do, and all they can see are more expenses falling on them: a wholly rebuilt electricity grid for which they’ll have to pay, plug-in electric cars which cost more than gasoline-powered ones, power restrictions that don’t allow you to recharge your Chevy Dolt at home when it gets too hot, and government requests, along with some actual action to force you to set your thermostats higher in the summer and lower in the winter, heating costs projected to rise 17.2% this coming winter, and the last thing that they want are the programs of the global warming climate change emergency activists making them poorer.

Mr Goldberg wrote that he believes that “we are going to have to sacrifice,” but, with his wife’s and his resources, they are not going to have to sacrifice nearly as much as the average American. Whatever sacrifices they will have to make, perhaps fewer dinners at nice restaurants, or having to pay an electrician to install an at-home charging station for a Tesla, won’t be as stressful for them as the sacrifices made by the single mother with two kids left her by a deadbeat ex-boyfriend in Pittsburgh, or the family in eastern Kentucky trying to survive in a poor area in which the coal mines have all closed.

Mr Goldberg is not, like the “great princess” mention by Monsieur Rousseau, saying “Let them eat brioche,” but is suggesting that those who eat cake might occasionally have to eat bread instead. What he misses is that there are those who can only afford bread right now, and the policy proposals of the activists would take that away from them as well.

Those people are already sacrificing under the current economy, something today’s left just really don’t understand. Oh, they say that they are concerned, say that they know and understand, but they simply do not: you cannot understand people who are living paycheck-to-paycheck and concomitantly propose mandatory programs which will make them even poorer.

Posted on by

What a surprise! Lithium prices are increasing as countries push electric cars.

In the episode “Mudd’s Women” in the original series Star Trek, Harry Mudd and the three women he was taking to sell as wives to settlers are detoured to a planet inhabited solely by dilithium crystals miners. Captain Mudd tells the three women that they’ll now be wives to “lithium miners, rich lithium miners”. Who knew that this might actually be prescient?

As President Biden and his supervisors Administration push zero-emission automobiles, and have proposed to ban the sale of gasoline-or-diesel-powered personal vehicles by 2035, many people have said that this could only drive up the cost of such vehicles. 2035 is still a long (?) way off, but sales of electric vehicles in China are already having an effect. From The Wall Street Journal:

Electric-Car Demand Pushes Lithium Prices to Records

Driven by a surge in Chinese electric-vehicles sales, the sharp rise in a key commodity for batteries could slow adoption of EVs globally

By Joe Wallace and Hardika Singh | Wednesday, September 21, 2022 | 5:30 AM EDT

Surging prices for lithium are intensifying a race between auto makers to lock up supplies and raising concerns that a shortage of the battery metal could slow the adoption of electric vehicles.

Lithium carbonate prices in China, the benchmark in the fast-growing market, stand at about $71,000 a metric ton, according to price-assessment firm Benchmark Mineral Intelligence. That is almost four times as high as a year ago and just below the record set this March in yuan terms.

Lithium is an outlier in commodity markets that have broadly retreated in recent months, reflecting gloom over an economic outlook dimmed by the Federal Reserve’s interest-rate increases and stuttering growth in China and Europe. Brent crude oil and copper—commodities used throughout industry and transportation—have fallen about 15% and 7%, respectively, this quarter. Even European natural-gas prices, propelled higher for much of 2022 by Russia’s move to cut supplies, have dropped by 10% over the past month.

But lithium keeps rising, driven by a pickup in electric-vehicles sales in China, the world’s biggest market for EVs. Car purchases jumped after Shanghai eased Covid-19 lockdowns in June, juicing demand for lithium-ion batteries. The China Passenger Car Association forecasts six million new EVs will be sold in the country this year, double the 2021 level.

“Lithium is really following the Chinese EV market and that’s just taking off,” said Edward Meir, a metals consultant at brokerage ED&F Capital Markets. “This is a preview of what could await us in the U.S.”

Draining supplies further, power outages caused by a heat wave in central China curbed output of refined lithium carbonate and hydroxide, which go into battery cathodes. Suppliers in Sichuan province—which has a third of China’s lithium processing capacity—closed factories for several days and ran down inventories to meet their sales commitments, said Rystad Energy analyst Susan Zou.

There’s a lot more at the original.

The final quoted paragraph notes a temporary problem, though one which could always recur. But the steadily increasing demand for lithium, something the proposed policies in the United States will only exacerbate, is not going to be a temporary thing.

Plug-in electric vehicles are already expensive. In Economics 101 theory, increased demand generates increased production and supply, which should bring the costs of electric cars down, but that’s theory only. The basic theory does not account for shortages of essential materials for increasing production and supply, and the lithium shortage will not be the only one which will force the prices of electric cars higher. For example, as the demand for electricity greatly increases, and more transmission lines are needed to get the required power to homes across the nation, the price of the aluminum used in power transmission lines. The price of aluminum is already increasing, due to the increased demand for canned goods, and it can only go higher.

No one who knows the first thing about economics can be surprised at this, but it sometimes appears that the environmentalists don’t know that first thing. One thing is certain: they don’t actually care about the economics of what they want, and don’t care about how the costs of their proposals will affect Other people, especially the working-class people of this country.

Posted on by

The Dummkopf from Delaware really doesn’t have a clue Enjoy paying your heating bills this winter!

We noted, on September 19th, that President Joe Biden said that we should put things in perspective, that the “inflation rate, month-to-month, was up just an inch, hardly at all”, that we’re in the position where for the last several months it hasn’t spiked, “we’re basically even.”

Well, our distinguished President doesn’t have to worry about paying his heating bills this winter, but most Americans do:

A cheery fire in our wood stove in Jim Thorpe, December 18, 2016.

Here’s how much more you’ll pay to heat your home this winter

By Kelly Hayes | Tuesday, September 20, 2022 \ 11:41 AM EDT

Americans are likely going to pay more to heat their home over the winter months.

The average cost of heating a household is set to increase by 17.2% this winter, compared to winter last year, according to a forecast by the National Energy Assistance Directors Association (NEADA), an educational and policy organization for federal programs that help low-income families pay their utility bills.

The article was illustrated with a nice, stock photo of a cheerily burning wood fire in a nice, upscale home fireplace, but I figured that, using my own photo from our previous home, was wiser for copyright purposes. Alas! Mrs Pico absolutely vetoed a wood-burning stove in our current house, because she says they make too much of a mess, so, to supplement the heat, and be a backup for when the sparktricity goes out — something not that infrequent here, and can be for several days out here in the country — we installed a propane fireplace.

The group expects the average winter heating bill to increase from $1,025 to $1,202, which would be the highest figure in over a decade.

U.S. residential electric bills are also forecast to increase 7.5% from 2021, according to the U.S. Energy Information Administration’s latest short-term outlook.

There’s more at the original.

Gas fireplace in my computer room/den.

Mr Biden is wealthy, and even if he did have to pay his own electricity and gas bills — which, for his private homes, he does — the increased costs would be an insignificant matter to him. But an extra $177 for the average working-class family? That’s a big bite. In the past, I’d have compared that $177 to a week’s trip to the grocery store, but now that’s barely half a week!

Let’s tell the truth here: for all of their protestations that they care about ordinary Americans, the Democrats really don’t understand us. The Washington elites have plenty of money, and the increases in energy costs simply don’t matter that much to them. Their proposals to fight global warming climate change will add thousands to people’s electricity bills, because so much new infrastructure will have to be built to support the greatly increased demand for electricity as people have to charge their Chevy Dolts at home. Phasing out reliable, fossil-fuel burning power plants and replacing them with solar and wind power generating facilities will cost big bucks.

By 2050, the US will demand nearly 90% more power than it did in 2018, in a scenario in which all new passenger vehicles sold by 2030 are electric and buildings and factories also aggressively electrify, according to an analysis by Nikit Abhyankar, a senior scientist at the Goldman School of Public Policy at the University of California, Berkeley.

Different scenarios will lead to a smaller increase in demand, but any changes which require more energy not from fossil fuels are going to lead to a huge increase in demand. Yet the projected increases in home heating costs are coming without any significant global warming climate change policies additions to current costs.

Perhaps President Biden doesn’t personally understand this, but his advisors certainly do, but that doesn’t matter: they just don’t care about what you have to pay, as long as they get their way.

Posted on by

Clueless at the top

American television networks spent all morning covering the funeral of Queen Elizabeth II, and if Her Majesty was just a figurehead, who reigned but not ruled, she still seems to have been more self-aware than President Biden:

The President tried to soft-peddle it, saying that, month-to-month, it was up “just an inch, hardly at all.” That would be great . . . if inflation hadn’t already been high. From The Wall Street Journal:

U.S. Inflation Remained High in August

Consumer prices excluding food, energy rose sharply, showing broad price pressures strengthened

By Gwynn Guilford | Updated September 13, 2022 | 7:17 PM EDT

U.S. consumer prices overall rose more slowly in August from a year earlier, but increased sharply from the prior month after excluding volatile food and energy prices, showing that inflation pressures remained strong and stubborn.

The Labor Department on Tuesday reported its consumer-price index rose 8.3% in August from the same month a year ago, down from 8.5% in July and from 9.1% in June, which was the highest inflation rate in four decades. The CPI measures what consumers pay for goods and services.

Here’s where the Journal’s paywall hits, but really, everyone who cares about economics should go ahead and subscribe to it!

And I guess that President Biden doesn’t read the Journal either, because in the 60 Minutes clip, because he didn’t know July’s inflation rate, either, saying:

It was 8.2, 8.2 before.

Clearly his supervisors hadn’t clued him in.

A President in command of the facts would have both expected the question about inflation, and would have said that yes, 8.3% is too high, but at least the inflation rate had dropped a bit.

Back to the Journal:

So-called core CPI, which excludes energy and food prices, increased 6.3% in August from a year earlier, up markedly from the 5.9% rate in both June and July—a signal that broad price pressures strengthened.

On a monthly basis, the core CPI rose 0.6% in August—double July’s pace. Investors and policy makers follow core inflation closely as a reflection of broad, underlying inflation and as a predictor of future inflation.

Let’s, as the President said, “put this in perspective”: the August 2022 inflation rate of 8.3% is on top of the August 2021 inflation rate of 5.3%

Skipping further down, we come to this stark paragraph:

The average household is spending $460 more each month to buy the same basket of goods and services as last year, said Ryan Sweet, senior director of economic research at Moody’s Analytics.

Assuming 22 workdays a month, and a loss of 20% to taxes and insurance withheld, that “average household” would need a wage increase of $3.136 per hour just to break even. Do you think that happened?

Real average hourly earnings decreased 2.8 percent, seasonally adjusted, from August 2021 to August 2022. The change in real average hourly earnings combined with a decrease of 0.6 percent in the average workweek resulted in a 3.4-percent decrease in real average weekly earnings over this period.

That’s for all workers. The Bureau of Labor Statistics — same source — also broke it down for “Production and Non-supervisory Workers”:

From August 2021 to August 2022, real average hourly earnings decreased 2.4 percent, seasonally adjusted. The change in real average hourly earnings combined with a 0.9-percent decrease in the average workweek resulted in a 3.2-percent decrease in real average weekly earnings over this period.

It’s kind of amusing: the supervisors and managers saw a greater loss of real earnings, but the working-class people, the ones who feel the economic pinch more because they earn less, still lost 3.2% in real terms.

Inflation is a serious, serious problem, and it is making the American people poorer in real terms. Perhaps President Biden doesn’t realize it, now that he’s got the government paying for his seemingly every weekend trips to Rehoboth Beach, but the surge in inflation, which began almost as soon as he took office, has made life worse for the public. But hey, at least there are no mean tweets!

Posted on by

Bidenflation The American working class are primarily Republican voters, so you can't expect the Biden Administration to consider them, can you?

I was wryly amused to see these two editorial links together on the front page of The Wall Street Journal’s website front page Wednesday morning. As President Joe Biden wants desperately to reduce inflation, with the midterm elections just 55 days away, it demonstrates the lack of thought the Administration has put into its policies.

Another Inflation Jolt for Markets

Investors get a reality check about prices and Fed tightening.

By The Editorial Board | Tuesday, September 13, 2022 | 6:54 PM EDT

Biden Administration officials have been claiming so confidently that inflation is under control and falling that investors may have believed it. Bad idea. Tuesday’s report on the consumer-price index for August showed inflation has remained high and sticky, and markets promptly fell out of bed.

And we mean from the top bunk. The 3.94% tumble in the Dow Jones Industrial Average was the worst day since 2020, and the declines in the S&P 500 and Nasdaq were worse. Investors apparently had believed the hopeful chatter that inflation was headed downward, and that the Federal Reserve wouldn’t need to raise interest rates so high as to court a recession. Investing lesson of the week: Never trust a politician.

Consumer prices overall rose 0.1% in August, after being flat in July. But the decline was almost entirely the result of falling energy prices. Gasoline fell 10.6% and fuel oil 5.9% in the month. That was a happy respite from the spring when gasoline prices averaged more than $5 a gallon nationwide, but prices at the pump are still up 25.6% in the last 12 months and still average $3.71 a gallon.

The larger problem is that the energy declines weren’t enough to offset price increases across nearly everything else. The 12-month inflation rate in August fell only to 8.3%, down from July’s 8.5%, but higher than the 8% to 8.1% that economists had expected.

Then there’s this, from Washington Post economics reporter and Editorial Board member Heather Long:

Hmmm: “Inflation has been eating up wage gains since April 2021 and shows little sign of significant easing.” People are getting poorer in real terms, and that has been the case really since Joe Biden became President.

Then there was this:

Biden Freezes Oil and Gas Leases

Calling Joe Manchin: Interior uses ‘sue and settle’ to suspend Trump-era approvals.

By The Editorial Board | Tuesday, September 13, 2022 | 6:53 PM EDT

Joe Manchin’s deal with Democratic Senate leader Chuck Schumer isn’t looking so good for the West Virginian, and the latest evidence is a Biden Administration settlement with green groups that stops previously approved oil and gas leases.

The Interior Department last week agreed to conduct additional climate reviews for five federal oil and gas lease sales held in 2019 and 2020 that were challenged by environmental groups. Activists claimed the Trump Administration didn’t sufficiently study the climate impact of the leases under the National Environmental Policy Act (NEPA).

Rather than defend the earlier environmental reviews, the Biden Administration surrendered to their progressive friends. According to last week’s legal settlement, the climate reviews will incorporate the “social cost” of greenhouse gas emissions that could result from the leases. This takes into account indirect global costs of emissions such as property damage from natural disasters, risk of conflict over resources, reduced agricultural productivity from drought, and more.

By including the social cost in the NEPA reviews, the Administration will be able to claim the leases have a significant negative environmental impact even when they don’t and then seek to cancel them. Alternatively, the Administration could try to force oil and gas producers to mitigate their emissions by helping fund its climate agenda.

While the settlement doesn’t outright cancel the leases, it will effectively freeze their development. Interior has agreed not to approve new drilling permits or rights-of-way on the leases until it completes the climate reviews. Even after those reviews are done and if Interior allows development, green groups will still be able to challenge the reviews and leases afresh in court.

There’s more at the original. The Wall Street Journal has a serious paywall, but even if you’re not a subscriber, you can get a couple of free articles a month.

The Biden Administration wants to reduce carbon dioxide (CO2) emissions and the use of fossil fuels to do so, but freezing oil and gas extraction leases won’t do anything about that. It simply means that more oil-and-gas production will come from overseas, and less from the United States, which means more of United States’ workers money will be going to Saudi Arabia and Venezuela rather than staying at home. Even if you don’t like those evil oil corporations, it means that there will be fewer American oil company workers, workers who earn what the Biden Administration likes to call “good, union wages,” will have jobs while more men overseas will be drawing paychecks from American dollars.

All of this makes American workers poorer. The American oil rig worker who makes big bucks per hour, but is getting no hours isn’t helping his family, and isn’t helping our economy. The oilfield worker who is unemployed because the Biden Administration is throwing obstacles into American production isn’t spending money at Dunkin’ Donuts for a coffee and bagel on the work in the morning, is buying fewer clothes because his work clothes aren’t getting worn out as fast, and his lack of work affects a lot of other people downstream.

The economic measure I find most important is actually a simple one, the velocity of money. The velocity of money is the frequency at which one unit of currency is used to purchase domestically- produced goods and services within a given time period. In other words, it is the number of times one dollar is spent to buy goods and services per unit of time. The lower the velocity of money, the less positive impact a dollar has on the economy. If the gasoline you buy is extracted in Kuwait, it may cost the same amount as if it had been extracted in Texas, but the dollars spent on Kuwaiti wages disappear from our economy while the dollars spent on Texas workers stay here. The more gasoline and diesel fuel we produce in the United States, the faster he velocity of money in the United States, and the more benefits and wealth accrue to American workers and their families.

There is another part not being considered in all of this. If we assume that we can move away from an energy economy based on petroleum, as the climate change activists want, and we can power our homes and cars and economy on ‘renewable,’ non-polluting energy, the more petroleum we buy from overseas because we are producing less here during that transition, then the more of the value our natural resources we have just wasted, left in the ground with no value. We will be making ourselves poorer during the transition.

Of course, the Biden Administration’s climate change activists can’t see that part, because they never think things through, and never really consider the economic impact on American workers in their plans. But hey, the American working class are primarily conservative, primarily Republican voters, so you can’t expect the Democrats to consider them, can you?