Babeled

By now I’m sure we have all heard the election year colloquialisms: energy independence, climate change, renewable energy, drill here drill now, environmental stewardship, etc.

One campaign promise from one candidate leaps out at me as a sure fire way to accomplish or negate all of these.  That is the pledge made by John McCain to build 45 nuclear power plants over the next 20 years.

Now, as both a Republican and a young nuclear professional I am obviously in favor of this pledge.  But all my feelings aside, I can honestly say that this is the one pledge that actually has the potential to accomplish all of those popular colloquialisms at once.

The new Economic Simplified Boiling Water Reactor (ESBWR) from General Electric has the capacity to produce 45 Megawatts of electricity.  Multiply this capacity by the 45 plants McCain proposes and we are looking at 67,500 Megawatts of new generating capacity in the US!

Contrary to what interveners will tell you, nuclear power is safe. Even the worst nuclear accident in United States history at Three Mile Island did not result in one single human death!  This statistic coupled with the advances in safety technology incorporated in the ESBWR makes nuclear one of the safest means of power generation available.

Also consider the fact that nuclear power is a zero-carbon energy supply.  Regardless of your stance on global warming, there can be no doubt that zero-carbon is the preferable means of generation.  Couple this with the magnitude of electrical generation that nuclear has the capacity for and you quite simply have both energy independence and environmental stewardship all in one package.

It is widely believed that Hydrogen Fuel Cells hold the key to transportation energy.  The biggest hurdle to this of course is where do we get Hydrogen?  With electricity prices so high, electrolysis from water (H₂O) is not practical and hence removing the Hydrogen from Natural Gas (C₂H₅) is the only alternative.  The down side to this of course is your byproduct from natural gas is CO₂ instead of just the pure O₂ that electrolysis produces.  Nuclear generated electricity would be cheap enough to allow electrolysis to produce enough hydrogen to power the nation’s vehicles.  Not only that, but the only byproducts would be the O₂ produced by the process and the steam (H₂O) from the car’s exhaust.  Yet another CO₂ reduction!

But what about that growing mountain of highly radioactive, long lived nuclear waste?

Mr. McCain has also pledged to both open the Yucca Mountain repository and pursue spent fuel recycling. Currently, spent nuclear fuel is stored at the plant that produced the waste.  The Yucca Mountain Repository is a multi billion-dollar project that has been long-delayed by political maneuvering and is yet to open.

Spent fuel recycling will not only provide additional energy to the cycle without further mining, but it will also reduce the burden placed on Yucca Mountain by slowing the rate at which the waste is produced.

The media has referred to Barack Obama as “lukewarm on nuclear.”  Sadly, this is a fallacy.  By refusing to open Yucca Mountain, refusing to allow spent fuel recycling, and failing to support new plant construction Mr. Obama is, by definition, anti-nuclear.  With Obama’s lack of support for each of the three issues that would allow nuclear to fulfill the nations energy demands his policy might better be described as “ice cold on nuclear.”  Obama cannot come out publicly and say this of course, for fear of exposing his inability to go against radical leftists.

Energy is at the core of nearly every major issue today.  The economy, national security, the environment: all are contingent upon meeting our growing energy demands.  Nuclear can meet those needs if our government would only allow it.

John McCain will allow it.  Barack Obama will not.  Consider this in November.

~Man Overboard

Popularity: 11% [?]

With the 2008 presidential elections a little less than a month away, citizens all around the country are gearing up to cast their votes (hopefully) on November 4th.  This presidential election is shaping up to be one of epic proportions as the elected President will without a doubt inherit not only a political mess, but also an economic nightmare.  The country’s economic status is rapidly worsening as major investment firms and banks are either getting bought out or declaring bankruptcy.  At the same time, the War on Terror seems to be a never ending tragedy.  And in the meantime, our country is so politically and socially divided that nothing seems to get solved.  What this country needs is a great leader that rises above all.

The presidential race has certainly heated up in the past few months with outlandish claims from both parties, Democrat and Republican.  The vice presidential candidates have seen an enormous amount of exposure due to the celebrity status of each candidate and the presidential candidates have been engaged in a battle of mudslinging that would make a pig take a bath.

Nevertheless, the elections are approaching fast and I just wanted to take a second to remind all you voters out there that the election is not a horse race.  You don’t have to vote for who you think will win or for who your party nominated or for who you think will screw the country up less or for the lesser of two evils, you should vote for who you think can do the best job!  Well, guess what you do have the option of voting for whomever you believe is best fit to lead our nation out of economic turmoil, social division, and international warfare.  And if you don’t see your candidate on the ticket, well then write his or her name in.  Either way, make your voices heard this November 4th!

On An Ending Note

Believe it or not, this country was not founded on the principle of choosing between two distinct parties.  George Washington even warned against political factions in his Farewell Address,

They [political parties] serve to organize faction, to give it an artificial and extraordinary force; to put, in the place of the delegated will of the nation, the will of a party, often a small but artful and enterprising minority of the community; and, according to the alternate triumphs of different parties, to make the public administration the mirror of the ill-concerted and incongruous projects of faction, rather than the organ of consistent and wholesome plans digested by common counsels, and modified by mutual interests.

(What a smart guy . . .)  The founding father of our country warned against political factions for he believed that they would only separate our nation more and thus leave our government with no way to mutually solve serious problems.  The most recent example of this can be seen last week when the $700 Bailout Plan was nixed.

Below are multiple websites that you can go to register to vote:

For people in New Jersey, like me, that have not registered yet, please visit the New Jersey Division of Elections.  The process is really easy and the only traveling that you need to do is walk from your house to your mailbox.

For the rest of the country, here are some websites that are available to register at:

Rock the Vote

Declare Yourself

U.S. Election Assistance Commission

Absentee Ballot Voting

If you are going to be away from your assigned voting district on November 4, 2008, please check out the following sites that easily help walk you through the absentee ballot voting process.

Go Vote Absentee

Long Distance Voter

Popularity: 8% [?]

Say what you will about negotiation with terrorists, but it appears that diplomacy is finally yielding a breakthrough in the War on Terror.

The News

According to a CNN report, on September 24-27, the final days of Ramadan, King Abdullah of Saudi Arabia held talks with 11 Taliban delegates, two Afghan government officials, a representative of former mujahadeen commander and U.S. foe Gulbadin Hekmatyar, and three others.

The purpose of these talks was to come to some sort of negotiation about how best to end the current conflict in Afghanistan.  Both parties agreed that continued violence would not yield peace any time soon. Rather, the Taliban admitted that they cannot match the U.S. led coalition.

During the meetings the Taliban emphasized the fact that they have severed ties with al Qaeda.

How does this change the game?

These are only the first of many scheduled talks between Saudi Arabia and the Taliban. The information that is already being revealed from these meetings seems to suggest that Iran is playing the role of instigator.

Several Afghan sources familiar with Iranian activities in Afghanistan have said Iranian officials and diplomats who are investing in business and building education facilities are lobbying politicians in Kabul. Coalition commanders regularly accuse Iran of arming the Taliban, and Western diplomats privately suggest that Iran is working against U.S. interests in Afghanistan, making it harder to bring peace. (CNN)

If what the Taliban say about al Qaeda is true, and if these talks are any indication that an Arab coalition may be forming that will help the US achieve its military goals, then it is clear that a confrontation with Iran is inevitable.

The Key to Ending the War on Terror

Al Qaeda, the embodiment of Radical Islam, is the door.  What lies beyond the door is a fruitful alliegiance between the West and the Middle East.  The door is currently locked.  The lock is a unified Arab Coalition.  The key is Iran.

By defining Iran as the key, we are faced with a dilemma.  We can either approach Iran as an enemy that needs to be forced out of the way, or we can approach Iran as a future-friend who has yet to understand how cooperation would be to their advantage.

In my opinion, diplomacy is the only choice.  If we continue acting from the belief that Iran is an “axis of evil” and destined to be a force of destruction in the Middle East, then we close ourselves off from any possibility of a unified Arab Coalition.  Likewise, we also close ourselves into an inevitable conflict with Iran.

Without cooperation from Iran,  peace in Afghanistan will take that much longer.  And the longer it takes to achieve peace, the longer it takes to bring our troops home.

Popularity: 10% [?]

Notice how, despite what Barack Obama and the media will tell you, it was the Republicans calling for tighter oversight of Fannie and Freddie back in 2004.  But the Democrats were quick to defend those who made them rich, even going so far as to lob pathetic personal insults at regulators attempting to raise the alarm.

Now let’s hear Speaker of The House, Nancy Pelosi’s viscious politcal rhetoric and finger-pointing only moments before the Bailout vote on what was supposed to be a non-partisan bill to help the American people.

Are House Republicans expected to endorse her comments by voting for the measure? So why did the Media give Speaker Pelosi a free pass after they called the following a “Political Stunt.”

But nothing was ever said about Obama’s casual attitude on the subject or his refusal to set aside politics for two days to do his job.  Could this be because Obama benefits from economic turmoil?

So, America, does the montage you just saw at all represent the picture that the media has painted for you about the two parties, the economic crisis, and the candidates?

On the first video, what party attempted to raise the alarm FOUR YEARS AGO on Fannie and Freddie while Senator Obama lined his pockets with their dirty money?  What party was on the side of the “Wall Street Fat Cats?”

On the last three videos, which of those three appeared to reach across the aisle to work with both parties?

Who is the leader and who are the dividers?

The media is lying to you!  Don’t fall for it.

~Man Overboard

Popularity: 10% [?]

A draft of the Emergency Economic Stabilization Act of 2008 (EESA), which the infamous $700 government bail-out of financial institutions is now officially dubbed, has been issued over the weekend.  Per the draft document the EESA’s main goal is to “restore liquidity and stability to the financial system of the United States” in a manner that:

(A) protects home values, college funds, retirement accounts, and life savings; (B) preserves homeownership and promotes jobs and economic growth; (C) maximizes overall returns to the taxpayers of the United States; and (D) provides public accountability for the exercise of such authority.

The EESA lays out two primary options for financial institutions under what is known as the Troubled Asset Relief Program (TARP), a part of the EESA.  TARP provides financial institutions with the ability to sell “troubled assets”, to be defined within 2 days of the EESA’s anticipated passage, by the U.S. Secretary of Treasury, at a value that cannot exceed the original face value of the asset.  The other option is insurance for those things classified as “troubled assets”.  In this case, the U.S. Treasury will sell insurance to financial institutions to guarantee the values and interest pay-outs on the asset by requiring the financial institution to pay an insurance premium to the government (similar to FDIC insurance).

In order to ensure that the EESA has the desired effect, the Financial Stability Oversight Board (FSOB) was created in the Act to review all financial aspects.  The FSOB consists of the Chairman of the Board of Governors of the Federal Reserve System, Secretary of Treasury, Director of Federal Home Finance Agency, the Chairman of the Securities and Exchange Commission (SEC), and the Secretary of Housing and Urban Development.  These individuals have the ability to appoint third party analysts to review transactions made under the authority granted by the EESA for malfeasance, fraud, and reasonability.  This is the government’s answer to the “blank check” sentiment that is already beginning to circulate amongst citizens.

The EESA 110-page draft goes on to list in excruciating detail the various committees that may be called and dissolved at will to review myriad aspects of the execution of the EESA and governance.  Those of us who are number-crunchers, eager to challenge and dive into the accounting and finance side of the EESA looking for feasibility and quantitative economic impact data, are left extremely unsatisfied by the EESA draft.  At no point in the draft are the (A) types of assets for purchase or insurance eligibility defined or identified specifically; (B) methods for valuation of the hereto undefined assets specified; (C) vehicles for funding the TARP; or (D) projection of potential value of “troubled assets” that would qualify for government purchase or insurance.

The most clear assertion of things to be classified as “troubled assets” comes from the amorphous language of in the definitions section of the EESA.  This definition reads as follows:

(9) The term “troubled assets” means - (A) residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before March 14, 2008, the purchase of which the Secretary [of Treasury] determines promotes financial market stability; and (B) any other financial instrument that the Secretary [of Treasury], after consultation with the Chairman of the Federal Reserve System, determines the purchase of which is necessary to promote financial market stability, but only upon transmittal of such determination, in writing, to the appropriate committees of Congress.

In this case, we see EESA’s focus is mortgage-backed securities and mortgages.  However, part B of the definition is what is most troubling.  While the approval of adding other financial assets for eligibility under the EESA must be recommended by both the Secretary of Treasury and the Federal Reserve Chairman, then approved by Congressional committees, the EESA document itself gives me pause when following the impacts of this Act through to their logical conclusion.  The language above grants the ability for the aforementioned individuals to recommend and approve ANY financial instrument for qualification under the EESA, hinging only on the requirement that the purchase or insurance of said security must promote financial market stability.

This is so troubling because at any point in an economic downturn, many financial instruments could be seen as “troubled assets” as that is the nature of financial decline.  Using the tech stock bubble and 9/11 as an example, a rapid, broad stock market decline causes serious economic impacts to corporations across many sectors resulting in job loss and GDP contraction (economic shrinkage).  If the EESA had been in place during a stock market decline of such magnitude, or larger, would we be seeing the Secretary and Chairman of the Fed requesting to bail-out companies with huge stock losses in their marketable securities or pension funds?  While answering that question is mere conjecture, the fact remains that the language being used in this Act opens the door for future actions such as the one just described to be taken by the government.  I would really not like to see our government develop a habit of throwing money at corporations with irresponsible financial practices.

The funding for all expenses, including administrative costs of executing this Act, is left ambiguously up to the language in chapter 31 of title 31, United States Code (Title 31 Money and Finance, Subtitle III Financial Management, Chapter 31 Public Debt).  This basically says that the funding for this Act is going to come from the issuance of a variety of government bonds and notes, not to exceed the public debit limit.  A little math lesson here: If the government were to sell $1,000 bonds or notes (most carry a face value of less than $1,000, but for sake of proving this point with maximum arithmetic ease we will use $1,000), they would need to sell 250 million bonds/notes to cover the initial $250 billion cash outlay forecasted for the EESA.

Although government bonds are considered less risky than corporate-backed ones, the fact remains that there must be a market of interested buyers for the bonds in order to raise money in this fashion.  With the ever-increasing shakiness of the U.S. economy, the government’s revenue stream (taxes) is in jeopardy due to a higher jobless rate (6.1% most recent figure) and corporate profits on the decline.  Therefore, the government has less revenue to back their securities, making them riskier and reducing the market of buyers for these bonds/notes.  I personally think it is unrealistic to assume that enough capital will be generated through a government bonds issuance to cover the cost of this Act.

The EESA still must pass Congress and be signed by the President, and will undoubtedly see revisions before it is signed into law, but this is a revealing first look at what our law-makers have been working so diligently on over the past week.  While I may not entirely agree with the legislation, I commend our government officials for stepping up to the plate and putting in the hours at night and over the weekend to work on what they feel is best for their constituents.  Even in the face of potentially huge bi-partisan contentions, they were able to go to work and produce a deliverable in a relatively short amount of time in response to an extremely complex situation.  I eagerly await more substance and will report back with analysis and insight that I may be able to provide on the matter.

Popularity: 14% [?]