Innovation And Your Income

The standard financial advisor lecture, either related to your 401(k) or your private portfolio, always has "The Chart".  The Chart illustrates the last 100-years or so of returns for a particular index to the U.S. stock market.  It always ends the same way - - it averaged 10% over the last 100-years with the implicit assumptions that it will average 10% for the next 100-years.  And these last 100-years?  Probably the greatest 100-year period in terms of innovation.  Look at transportation - - from the horse and buggy to train to car to airplane to jet to rocket to spacecraft.  From a horse ride to the market to a trip to the moon.  This is a key reason for the 10% return per year over the last 100-years.

But look at income in the context of innovation.  The income numbers for Americans reflect a slowdown in growth - - growth in innovation that moves median incomes upwards.  From 1947 to 1973 - - a period of just 26 years - - inflation-adjusted median income is the U.S. more than doubled.  But is the 31 years from 1973 to 2004, it rose only 22 percent.  And, over the last decade, it actually declined (this has not happened since a ten year period associated with the Great Depreciation).  To be fair, the U.S. is not alone.  Most developed countries have experienced this same problem.

Many of our most noted and productive inventions are getting long in the tooth.  Today, no huge improvements for the automobile or airplane is in sight, and the major struggle is to limit their pollution, not to vastly improve their capabilities (my grandfather's first car, a Model T, and my Dodge Ram 1500 get the same gas mileage).  The Internet is seen as an innovative development in which it might produce new explosive growth.  But the Internet has not been a huge macroeconomic hit.  In terms of macroeconomic growth, is Facebook a replacement for automobiles, jets, and nuclear power?  Is a platform for Twitter and video games really going to boost median income?

We had better either become much more innovative in the areas that move median incomes or collectively development the temperament that can live with much slower growth and fewer alternatives.  The government fundamentally faces a fork in the road moment.  Either do the things that produces innovations -- education investments and strategic R&D or do the things that manages temperaments.

Avaaz

The word Avaaz means "voice" in many different Asian languages.  Avaaz is actually one of the largest online communities with more than three million members.  Spearheaded by a lean team of social networkers, it has no use for national chapters, dividing its operations not by geography but by language.

Avaaz gives a voice to the voiceless - - their organizational vision is the linking of local grievances to global resources.  Techno-activism - - real-time information to millions combined with getting media and governments to focus on issues sooner than they otherwise might.

The news tonight from Egypt demonstrates the power and frustration of millions who are surviving on $2 per day where escalating food prices, limited economic opportunities, combined with a government of no accountability and transparency.  With services such as Avaaz, Facebook, Twitter, and e-mail - - the under-privileged, under-served, and under-feared have decided that human rights are one arena in particular that must be contested from the bottom up, not the top down.

We may be entering a period of our global history where technology allows the bottom to more easily and successfully challenge the status quo.  With economic stagnation, food pressures, limited and effective democratic representation, rising income equality, corrupt practices - - the status quo has a lot to be challenged over.

Abrupt Climate Change

This is a link to a report commissioned by the Department of Defense in 2003 - - An Abrupt Climate Change Scenario and Its Implications for United States National Security.

The authors' views are extreme - - wars, starvation, disease, refugee flows, a human population crash, civil war in China, and the defensive fortification of the United States.

The U.S. Central Intelligence Agency has opened a center specifically dedicated to assessing climate change in the context of national security.

Extreme, yes.  Plausible, maybe.  Should the engineering professions also be looking at climate change with the same relevance as DOD?  Yes - - and quickly.

The Seven Habits of Highly Effective Engineers

Time for the evolution lecture regarding our species - - Homo ingeniumist.  We are in evolutionary times (they may more correctly be revolutionary times) that requires our species to think differently - - which ultimately means think better and more effectively.  We can start with Covey's self-help axioms and see how they fit into our evolutionary advancement in the context of a civil engineer.

1. Habit 1: Be Proactive - - From sustainability to climate change to energy/water constraints, our species needs a much more thoughtful, insightful, broader, and proactive connection to some of our pressing problems.  We need engineers willing to take on public leadership roles that are advocates for debates, discussions, and action regarding what we should all consider as the "Big Three" of the planet.
2. Habit 2: Begin with the End in Mind - - The species needs to work on the vision thing.  From the simplest endeavor - - the 20-minute staff meeting to the 40-story building.  Always think in terms of goals and outcomes.  Work on your ability to communicate that vision.
3. Habit 3: Put First Things First - - The species needs more Darwin and less Adam Smith.  Our survival is fundamentally about attracting and supporting the right people, willing to do the right things, for the right reasons.  It is a Darwinian selection process.  Our species survives because of our character, values, and culture - - putting those attributes out front to the public.
4. Habit 4: Think Win-Win - - The jungle our species works in is $14 trillion dollars in debt.  Any advancement in the quality of our infrastructure will not come solely from the public sector.  Our species needs to embrace public-private partnerships and working solutions that produce effective and long-term win-win situations.  Our survival depends on our ability to network and work with other species outside our historical networks and spheres of interest.
5. Habit 5: Seek First to Understand, Then to be Understood - - We need to understand God's golden communication ratio - - 2 to 1.  We have two ears to one mouth - - use them in that proportion.  If you cannot write the King's English in the age of social media or are not well spoken in the age of YouTube - - your value to the species is limited.  Evolve and get better.
6. Habit 6: Synergize - - The species is taught to pull complex systems apart and understand every nut and bolt.  But the species needs other members that can put things together and see the interconnections of complex systems.  The jungle is getting more and more complex and interconnected - - where holistic vision is needed for survival.  Don't get lost in the forest because of the trees.
7. Habit 7: Sharpen the Saw - - If you just graduated, plan on working until you are 75-years old.  The jungle has changed.  Think about how you as an individual will need and want to evolve over the next 50 years.  Never reading a book or learning something new is not an alternative in our new Darwinian world.  Find other members of the species that you can network with over this 50-year journey. 

Regina Aquarum

The title translates to - - "The Queen of Waters" - - a name given to ancient Rome.  The name reflected the skill of Roman engineers regarding their ability to provide Romans two millennia ago with as much as 250 gallons of water per person daily.  The ancient aqueducts are serving a new purpose in 2011 AD - - in the area of renewable energy.  Be it hyropower or wind power or energy from distilled corn - - the direction forward in terms of at least some component of our renewable energy system might be to pull out a book on ancient world engineering.

Consider the case of Hydrowatt, an Italian start-up company that generates electricity along Rome's aqueduct system.  The following highlights some of their efforts:

• Turbines in the Ascoli aqueduct produce roughly two million kilowatt-hours a year.
• Hydrowatt generates nearly 60 million kWh per year - - enough for about 30,000 homes - - from 40 plants on aqueducts across Central and Northern Italy.  It is the largest producer of its kind in Italy.
• Hydrowatt's engineers seek out places where pipelines have valves designed to release excess pressure as water flows rapidly down the mountainsides.  Once they identify such a site, the brother owners of Hydrowatt offer local authorities that control the aqueducts a deal to replace the valves with Hydrowatt's turbines.
• The company is build around the idea of converting losses into energy.
• Revenue was $14 million last year.
• They recently build four small turbines in New England.
• Hydropower is not subject to the randomness of sunshine or a stiff breeze - - each kilowatt of capacity translates into 8,000 kWh of power annually.
• Approximately 19% of the energy in Italy comes from hydropower - - the leader in the EU.

The Top Twenty

Here is the top twenty world port cities most vulnerable to global sea level rise, hurricanes, and land subsidence - -

• Mumbai, India
• Guangzhou - Guangdong, China
• Shanghai, China
• Miami, USA
• Ho Chi Minh City, Vietnam
• Calcutta, India
• New York - Newark, USA
• Osaka - Kobe, Japan
• Alexandria, Egypt
• New Orleans, USA
• Tokyo, Japan
• Tianjin, China
• Bangkok, Thailand
• Dhaka, Bangladesh
• Amsterdam, Netherlands
• Hai Phong, Vietnam
• Rotterdam, Netherlands
• Shenzhen, China
• Nagoya, Japan
• Abidjan, Cote d'Ivoire

We not only have the risk of inflation due to increasing demand for basic commodities - - oil, steel, concrete, food, etc. - - we also have the risk of much tighter logistical constraints and higher transportation costs.  Looking at just China and Japan, 40% of the top twenty cites are in these two countries.

How tall are you?

What if you could imagine your income being proportional to your height.  How tall would you be in comparison to others as you take a walk?  Jan Pen, a Dutch economist who died last year, came up with just such an idea to look at income inequality.

You are on your walk when the first passers-by are the owners of loss-making businesses - - they are invisible, their head below the ground.  Then come the jobless and the working poor, who are midgets.  After half an hour the strollers are still only waist-high, since America's median income is only half the mean (think about that and picture the normal distribution that produces such a thing).  It takes nearly 45 minutes before normal-sized people appear.  But then, in the final minutes, giants thunder by.  With six minutes to go on your walk, 12 foot tall people start to appear.  When the 400 highest earners walk by, right at the end, each is more than two miles tall (Note: The attached graphic is from 2006 - - you can see what four years has meant to the tallest among us - - four really bad economic years).

Engineers are not on their bellies chipping away at the coalface of life.  We are above average in height.  But engineers need to be highly concerned with rising income inequality.  By most measures - - the more unequal societies become the worse they do according to almost every quality-of-life indicator.  Inequality has negative social consequences and it perverts politics.  In the United States, income inequality began to widen in the 1980s largely because the poor fell behind those in the middle.  More recently, the shift has been overwhelmingly due to a rise in the share of income going to the very top - - the "Two Mile Club" - - particularly those working in the financial sector.

Globalization and technology are twin sources of the inequality.  A global market offers bigger returns to those at the top of their game - - authors and hedge fund managers are in this boat.  Modern technology favors the skilled and educated - - your height is proportional to your brain.  Some of the inequality is purely social - - educated men and women tend to marry one another.

Some of this is obviously performance and pay as part of a meritocratic process.  Some of this is just plain old rigging of rules and institutions.  The risk for democratic societies is the potential backlash among the "rule playing and educated" when they see wider inequality and fewer rungs in the ladder and lower growth because of rigged rules and subsides that favor specific industries and specific global elites.

Pay attention to your height as you walk around your city and community.

All-or-None Processes

In a complex environment, all engineers are up against two main problems and difficulties.  The first is the fallibility of human memory and attention, especially when it comes to mundane, routine matters that are easily overlooked under the strain of more pressing events.  Faulty memory and distraction (our mutlitasked world is a world of constant distraction and interruptions) are a particular danger in what the engineering community calls "all-or-none processes" - - whether running to the store to buy the ingredients for a cake, preparing an airplane for takeoff, or evaluating a sick person in the hospital - - if you happen to miss just one key thing (we have all had to made that long drive back to the store because we forget a critical item on the list), you might as well not have made the effort at all.  Forget one key constraint or requirement in a design - - you start over because we are the poster child for all-or-none processes.

The second problem is a product of our 24/7 speed driven culture and social climate.  Engineers can lull themselves into skipping steps even when they remember them.  In complex processes and environments, after all, certain steps don't always matter.  "This has never been a problem before" -- until one day it is.  The foundation of engineering is a systematic and disciplined approach to problem solving and design.  We have steps that are explicit - - with historical verification.  Don't skip things - - remember your mental checklist regarding doing the right things for the right reasons.

The State of Our Infrastructure

What happens when the world of anti-tax rhetoric meets the world of declining and critical  infrastructure?  What happens is embedded in these two stories from the January 22, 2011 edition of The Wall Street Journal.

The first story is entitled Water Demands Run Into Antitax Push - -

Lockeford, Calif. - - Some of the farmers here in the rural Central Valley have been seeking a new tax levy for their water system.  Dwindling groundwater, they say, is endangering the water supply.  "None of us likes to pay taxes.  But this is our water," said Tom Hoffman, a pro-tax farmer who has 140 acres of wine grapes here and until recently sat on the local water board.  But voters here already have rejected the proposed levy, and last fall elected a firmly antitax group of members to the North San Joaqin Water Conservation District Board.  "No new taxes," said Hugh Scanlon, a newly elected Republican member.  That "is the pledge I made to the people."


Infrastructure as a driving force behind economic development, food production, and long-term growth meets the complex world of local politics, big ag-businesses, long-term water supply concerns, and the "moral issue" of the fact that "money in the bank doesn't create rain."

The second story -- Pipeline Probe Finds Welding Flaws - - provides insight into one of the causes of the San Bruno, Calif. gas line explosion in September 2010 that killed eight people and destroyed 37 homes.  The pipeline is owned and operated by PG&E.

The National Transportation Safety Board on Friday released a metallurgical analysis of approximately 55 feet of pipe that appeared to rule out several possible causes of the pipeline failure, including corrosion or external blunt force, such as from a backhoe, and to suggest the blame could involve substandard welds.  The 30-inch diameter pipeline, build in the 1950s, had length-wise welds.  The investigation has uncovered discrepancies between the types of pipe records suggested were in the area and the actual pipes found there.

Both stories point out a series of collective and interconnected problems.  A lack of public respect for the risks and uncertainties associated with declining infrastructure, embedded in a world of inadequate funding and revenue sources, combined the mysteries of exactly what is below the surface (having something in the ground 60-years is one thing, having something in the ground 60-years and not fully understanding what it is - - that is a whole new problem) -- all of this spells trouble for our most critical and interconnected systems.  Energy and water - - both are at risk for further decline and uncertainties.

What is a tree worth?

You live in Atlanta, Georgia.  Home to approximately 9,415,000 urban trees.  What would be the value of those trees - - in terms of their social, environmental, and economic value?  This is becoming increasingly important as trees, especially those in urban environments, are seen as means to reduce energy consumption and an important source of carbon sequestration.

The U.S. Department of Agriculture, Forest Service has a study out, Assessing Urban Forest Effects and Values, that looks at this question for the city of Chicago, Illinois.  Chicago is home to 3,585,000 trees with a tree cover of 17.2%.  The most common species are white ash, mulberry, green ash, and tree-of-heaven with 61.2% of the urban forest having a 6-inch or less diameter.

Valuation is presented as two components.  The first is structural value.  This includes the structural value of the tree - - the cost of having to replace the tree with a similar tree.  The second is the value associated with carbon storage - - the value of carbon stored in a tree.  Carbon storage is an indication of the amount of carbon that can be released if trees are allowed to die and decompose.  Estimates from the report are:

• Structural value - - $2.3 billion ($642 per tree)
• Carbon storage - - $14.8 million ($4 per tree)

Urban forests also have functional values (either positive or negative) based on the functions they performs.  Estimates from the report on an annual basis are:

• Carbon sequestration - - $521,000
• Pollution removal - - $6.4 million
• Reduced energy costs - - $360,000

Annual benefits total approximately $7,281,000 per year.  Assuming a 5% rate of return, 50-life cycle, and no decline in the annual functional performance as the forest ages - - present value is approximately $2.6 billion ($725 per tree).  The average tree in the Chicago urban forest is approximately worth $1,371, with the entire urban forest valued at $4.9 billion in 2011 dollars.

What IBM Thinks

From Jim Spohrer, Director, IBM University Programs World-Wide - - as quoted in the December 17, 2010 issue of The Chronicle of Higher Education:

"Help students be more interdisciplinary.  Knowledge workers today need a combination of skills that spans technology, business, and social sciences.  This requires three distinct parts of universities to work together and bridge their siloed boundaries."

"Find better ways to encourage faculty who are boundary-spanners."

"Provide faculty and students more opportunities to connect locally and globally."

Know Nothings

Want more funding for better roads and highways?  Want better schools and higher paid teachers?  What about more fire stations and fire trucks and less fireman retirement pensions?  Better public infrastructure and better ideas start with better citizens.  Where one measure of better is a more informed, knowledgeable, and intellectually engaged citizenry.

Let's start with a pop quiz - - from a test first administered by the Hearst Corporation in 1987:

True or false:  The following phrases are found in the U.S. Constitution:

1. "From each according to his ability, to each according to his need."
2. "The consent of the governed."
3. "Life, liberty, and the pursuit of happiness."
4. "All men are created equal."
5. "Of the people, by the people, for the people."

Eight in ten American thought #4 was in the Constitution (Honest Abe and the Gettysburg Address).  The more telling result was #1 - - 50% guessed the Constitution (Karl Marx, 1875 - - I guessed George Orwell, same thing.  With that answer, difficult to tell who actually won the Cold War.).  None of the five were actually in the Constitution - - always think trick question when someone knocks on your front door.

Here is the result of a 2000 survey in which interviewees were ask to identify William Rehnquist's job -- the correct answer is "The Chief Justice of the United States Supreme Court."  My favorite reply was the breezy - - "A Supreme Court judge who is the head honcho." 

About a quarter of American voters are what political scientists call, impoliticly "know nothings" - - meaning that they possess almost no general knowledge of the workings of their government at any level, at least according to studies conducted by the American National Election Survey since 1948, during which time the "know nothing" rate has barely budged.

In some respects, a nation of "know nothings" has produced a civic culture of "do nothings" --  the two not only are correlated but also linked by cause and effect.

Planning for the end of oil

Richard Sears is a geophysicist who was previously vice president for exploration and deep water technical evaluation at Shell.  He is currently associated with MIT.  Sears believes that there are between 30 and 50 years left before a broad gap opens between worldwide oil supply and demand.

Sears recently spoke at a TED conference in Long Beach, California.  He held up a small pincushion of the globe, with red thumbtacks stuck in it.  Each thumbtack represented an oil basin - - the world of oil as we know it.  All 650 billion barrels of remaining oil - - in many places controlled and populated by RAVS (Russians, Arabs, and Villains that Smoke).  In the last decade, 43 percent of the industry's new reserves have come from deep water - - the future may be in places off the coast of Africa at drilling depths of 35,000 feet with test holes coming in at $100 million.

Sears doesn't see a world where we run out of oil - - technology and innovation will allow us to "de-carbonize", a process according to Sears that has been underway for sometime.  Like Sears said in his talk -- the Stone Age didn't end because we ran out of stones.

The Flying Cow Problem

I had to smile at this when I came across it in this past Sunday's New York Times Magazine - -

There is an element of uncertainty in every complicated engineering endeavor.  "In July 2003, in the Pacific, a Japanese fishing boat was sunk by a flying cow," Robert Bea told me.  Bea is a professor of civil and environmental engineering at the University of California, Berkeley, and a leading scholar of risk; he also spent many years working in research and management at Shell.  The cow, it turned out, was part of an illegal cattle shipment bound from Anchorage to Russia; as the plane approached its destination the smugglers became nervous about their cargo and began shoving it out of the plane.  "No risk analysis can ever be complete.  No one can predict a flying cow."

The story may be comical, but the insight and importance is deadly serious.  The seriousness is increasingly an issue for engineers - - from climate change uncertainty to terrorism risks to energy disruptions - - our flying cow moments should be of concern.  If you cannot model or predict with any level of certainty our flying cow events - - then what?

The issue becomes one of resilience - - where resilience is defined as the ability to bounce or spring back into shape, position, etc. after being pressed or stretched.  The fundamental concept is the linkage between resilience and the ability to recover after a physical stress.  You cannot predict the flying cow taking down your pump station.  The issue then becomes your organizational abilities to adapt and the speed with which you can get the pump station back online.

Think in terms of the Four R's presented below - -

1. Robustness - - the inherent strength or resistance in a system to withstand external demands without degradation or loss of functionality. 
2. Redundancy - - system properties that allow for alternative options, choices, and substitutions under stress.
3. Resourcefulness - - the capacity to mobilize needed resources and services in emergencies.
4. Rapidity - - the speed with which disruption can be overcome and safety, services, and financial stability restored.

The Four R's of resilience have individual technical, organizational, social, and economic components that will need consideration.  This will require engineers to engage in educational exercises, risk communication, strong and innovative leadership, effective planning, and adequate fiscal resources.  At first glance, these issues and responsibilities do not appear to be directly associated with engineering and technology.  However, all of them must be informed by accurate, up-to-date science, technology, and information made possible by partnerships and networks among communities, governments, and scientists and engineers.

Are you prepared for the next flying cow?

Sir Ken Robinson

Robinson is an author, speaker, and international advisor to governments on education, learning, and creativity.

The video is from his 2010 TED talk - -

FRED

From time to to time, engineers need to be able to access economics data - - one-stop-shopping online for macroeconomics data has always been a bit of a mystery.  What was needed was a site for professionals along with ordinary citizens - - where you could pull apart the data and come to your own conclusions.

The financial crisis in 2007 tarnished the image of the professional economist - - producing a collective, "Where can I see the data myself and come to my own conclusions?"  One of the best new sites in the era of "do-it-yourself" macroeconomics is FRED, maintained by the Federal Reserve Bank in St. Louis, enabling anyone with a connection to the Web to download data on everything fromm local home-price indexes to credit-card balances to weekly fluctuations in diesel prices.

Have fun and enjoy!

Snow and Ice Removal in Atlanta, GA

Day four of no school at Georgia Tech - - where my son is a Freshman.

SAVE

From cost-saving ideas submitted by federal employees as part of President Obama's SAVE (Securing Americans' Value and Efficiency) award program - - as published on Page 18 of the February 2011 issue of Harper's - -

• Remove urinals that are installed aboard ships.  The salt water mixed with urine creates calcium buildup.  This buildup clogs pipes, which require continuous maintenance.
• Urinalysis is a necessary requirement to ensure servicemen and women are prepared for duty, but have you ever thought about the cost to ship all that pee to the drug-testing lab?
• Stop renaming government buildings, parks, and bridges that have already been named.
• Once every three years have early retirement and get rid of some dead weight who do no more than come to work and gripe.
• Have two stretch breaks a day as a group at the office, each consisting of five to ten minutes.
• I suggest a new invention to generate power like wind turbines but without the wind or water current.  I believe I may have figured out how to do it, but I need help.
• Eliminate the Secret Service for all ex-officials.
• I suggest we ship our prisoners out of the country and contract out the service.
• Student should grow their own food.  They would learn about growing the food as well as save money for the schools.
• Stop giving people in public housing air-conditioning, dishwashers, washers, and dryers.
• Do away with going to the moon.  Been there and done that.
• Generally the default font setting in Microsoft Word, and most email programs are Calibri or Arial.  Printing in these default fonts has substantially higher cost than using less ink-intensive fonts.
• I recommend that we stop asking government employees for ideas that will not be used.  This could result in a savings of $50,000 per year or more.  The basis for this savings is 5k D.O.D. employees participated last year x 10 min. per submission x $60 per hr.

Henry Mintzberg - - Round Four

From Henry Mintzberg and Managing (2009):

• The big problem today is macroleading: managers who are disconnected, don't know what's going on.
• Why does so much managing have to take place in isolated offices and closed meeting rooms?
• A gaping hole exists between those who administer and those who deliver the basic services.
• That big picture has to be painted stroke by stroke, experience by experience.
• It is too common to witness people being blamed for failures that can be traced to their inadequate access to the information necessary to perform their delegated tasks.
• How to delegate when so much of the relevant information is personal, oral, and often privileged?
• The manager is the sink of organizational disorder.  Thus, if managing is getting order out of disorder, then the Enigma of Order reads: How to bring order to the work of others when the work of managing is itself so disorderly?
• How to maintain a sufficient level of confidence without crossing over into arrogance?
• We only notice what is changing, not what isn't, which includes most of what is around us.
• How to manage change when there is the need to maintain continuity.
• If you want to uncover someone's flaws, marry them or else work for them.
• Some managers are just in the wrong line of work.

The 75% Tax Increase

The January 10, 2011 issue of The New York Times paints a picture in headlines suitable for Goya - - "In Illinois, a Giant Deficit Leads to Talk of a Giant Tax Increase."  Giant in this case is a 75% increase in the state's income tax rate.  Illinois faces a deficit of at least $13 billion (Illinois has a budget deficit of $1,010.54 per capita.  In comparison, Texas has a deficit estimated at $24 billion for a population of 25,268,418 - - roughly $949.80 per capita.  The difference between "Giant" and something else appears to be around 6%.  For a trillion dollar federal deficit, the national per capita share is $3,333 - - this may actually be the upper boundary of the word "Giant.").  Illinois is currently 153 working days behind in paying its bills.  Only California has a lower bond rating than Illinois. 

A report by the University of Illinois - - "Titanic and Sinking: The Illinois Budget Disaster" highlights the following:

• No easy solutions - - we really need to print up 308 million t-shirts and hand them out to all U.S. citizens.
• The future is more unpleasant than the the present.  A do nothing alternative produces a $23.9 billion deficit in 2022 in 2010 dollars.
• No singular policy adjustment works.  Wait for the economy to improve - - far short to fill the gap.  Continue to accumulate obligations - - a 2030 backlog at $230 billion.  Borrow your way out - - the 2019 debt service costs would obligate every dollar received.  Increase the income tax rate - - doubling the rates would be required.  Increase the income tax base - - taxing Social Security benefits would fall short.  Increase the sales tax rate - - a 13.5% rate would be required.  Increase the sales tax base - - taxing services is not enough.  Spending freeze - - falls short.  Spending cuts - - not large enough without Medicaid and education cuts.

Titanic, sinking, near insolvent - - Illinois is facing a bleak future of multiple and massive policy changes.  Where massive might be a 50% tax rate increases and spending cuts that shut down entire core functions of state government.  Illinois might just be our national canary in the deficit mineshaft - - a world of no easy solutions where the policy goal becomes broad and shared sacrifice.

A world of 308 million t-shirts - - "No Easy Solutions."

Concept Modeling

Engineers understand that everything starts with an idea.  But what engineers need to remember is that truly great ideas are built on a concept.  To me, the idea of a concept is a very deep understanding or grasp - - the most basic understanding of something.  Both context and empathy are key components of this deep and fundamental understanding of a problem or issue.  This is the basis for concept modeling.

Think about this the next time your are at Starbucks.  Look at your Starbucks coffee cup - - in a far distance time and world, paper cups had little paper handles that mimicked those on ceramic mugs.  But someone came up with a sleeve and presumably made a zillion dollars.  Because the person understood that the underlying concept runs much deeper than the mere notion of an ear-like protuberance on the side of a paper cylinder.  They understood the essence of what was at play - - they understood connections, context, and the required capabilities.  They were empathetic to the end user - - because they had probably also held a hot cup of coffee.

They understood the concept and were very good at the mental models associated with developing their own conceptual model of a workable solution.  They were conceptual problem solvers and not just shallow solution seekers.

Shared, Smaller, Slower

Sometime in late 2011, according to the U.N. Population Division, there will be seven billion of us.  With the population still growing by about 80 million each year, it's hard not to be alarmed.  Right now on Earth, water tables are falling, soil is eroding, glaciers are melting, and fish stocks are vanishing.  Close to a billion people go hungry each day.  Decades from now, there will likely be two billion more mouths to feed, mostly in poor countries.  All of these "wicked problems" will pose challenges to engineers.

We will also see opportunities and challenges associated with the "600/60 Global Club" - - some 600 cities will account for 60 percent of the world's economic growth over the next two decades.  The central role of cities in global growth is due to the benefits of agglomeration - - industry and service sectors cites having a higher productivity than in a rural setting.  It is also around 30 percent to 50 percent cheaper to deliver basic services such as water, housing, and education in cities than in a rural setting.  Managed correctly, the 600/60 Global Club has the opportunity to make huge advances in sustainable living in urban environments - - with a focus on living smaller, living closer, and driving less.

Transportation planners and engineers along with representatives from the automobile industry have key roles in the world of living smaller, living closer, and driving less.  Tom Vanderlit is the author of Traffic: Why We Drive the Way We Do (2009) and he has several insightful comments in the Winter 2010 issue of the World Policy Journal - -

We spent much of the twentieth century engaged in a campaign to retrofit our cities for the car.  However much this may have seemed to make sense at the time, it now looks more like a misdirected effort to save the city by destroying it.  As plentiful as the benefits of individual vehicular mobility may be, the large metropolis can never comfortably accommodate any more than a fraction of its citizens in this manner, and we have learned the consequences of trying to do so.  Every-lengthening commutes have meant degraded public space, negative health outcomes, social fragmentation and infrastructure whose maintenance goes underfunded.

In the city of the future, we need to pursue policies that allow for safe, efficient and affordable transport of the many, while recognizing that market-based approaches that so rationally apportion space in the private sector can and should be applied to the valuable urban space - - that cities essentially give away.  We need to recognize that streets are public spaces too, and not merely, in the old view of 1930s utopian modernism, channels for moving as many vehicles as quickly as possible.  The car will continue to exist, but should be treated as a "renter" of the city, not its landlord.  The urban car of the future should be shared, smaller, and slower.

Engineering will have several key objectives during the next several decades - - one will be integrating and implementing the interplay between the city (living smaller, living closer, driving less) and the car (shared, smaller, slower).

What's Fair Pay?

Engineers, like everyone else, probably consider the price of work as the most important price in a person's life.  The labor market is where we trade our skills for shelter, food, and hopefully happiness.  For better or worse, your wage will go a long way to determining the sort of life you will lead. 

Two things drive engineering wages - - how valuable the job is to the employer and the supply and demand for workers in a given skill.  Rising pay has nothing to do with justice.  Today, an engineer can produce in less than ten minutes what it took an engineer in 1890 an hour to produce.  That's why we make more money.  Other patterns of compensation are fairly easy to understand and some don't make any sense - -

• Highly educated workers tend to earn more than those with less schooling.
• In India, men who are fluent in English earn 34% more than those who don't speak the language - - even, if for example, they are both PhDs.
• The "tall" make 10% more for every four inches in extra height.
• The "ugly" earn less than the "pretty" - - regardless of whether beauty has anything to do with the job.

Clearly some of this appears as out right discrimination.  Others have attempted to loop this back to productivity issues.  Studies in Sweden found that taller people are smarter and stronger and have better social skills because they were healthier and better nourished as children.  Being taller, they had higher self-esteem.  The short are simply less productive.  And productivity is what bosses go to the labor market to buy.

Like I said - - and some don't make any sense.

The Two Modes of Engineering Creativity

Engineering creativity involves a dynamic interplay between generating ideas and making judgements about them.  Getting the balance right is critical - - some individuals and organizations are more successful than others.  Apple is clearly an organization that excels at this interplay.  The engineering imaginative activity is the process of generating something original: providing an alternative to the conventional or routine.  It's a form of mental play that is essentially generative, in which the engineer attempts to expand the possibilities of a situation, to look at it from a new perspective.

Creative activity involves playing with ideas and trying out possibilities - - playing with ideas, concepts, and things that you love.  In any creative engineering process there are likely to be dead ends: ideas and designs that do not work.  There may be failures and changes before the best outcome is produced.  Evaluating which ideas do work and which don't involves judgement and critical thinking.  Understanding this in an important foundation for creative development.  It is an important foundation for the development of engineering talent.

Coffee or Tea?

Coffee drinkers in the United States consume approximately 400 million cups of coffee per day.  Roughly 1.46 billion cups of coffee per year at the average rate of 1.3 cups per person per day.  Assuming the global rate is 50% of the U.S. per capita consumption - - the global consumption totals 3.9 billion cups of coffee per day. 

Coffee requires about 37 gallons of water per cup from the high plateaus of Kenya to the counters of Starbucks - - water for production, processing, and milling.  Coffee requires about the same amount of water as tea to grow, but it ranks far higher in virtual water consumption because of the lower yield of end product per acre (tea requires nine gallons of water per cup).  Adding your favorite dairy product to your cup of morning coffee ups your water consumption - - one glass of milk requires 53 gallons of water.

Starbucks has a series of energy reduction and water consumption goals that one should applaud them for.  They seem on the surface to take the conceptual notion of sustainable seriously.  Under water, they have a goal to "Reduce water consumption by 25% in our company-owned stores."  Looking at the 2008-2009 results, water consumption declined 4.1% (From 24.4 gallons/square foot/store/month to 23.4 gallons/square foot/store/month - - the store portion of the unit provides equivalence for increases and decreases in store numbers).  With 5,000 stores as an estimate @ 1,000 square feet per store equals a savings of five million gallons per month.  An impressive number.

Assume that Starbucks has just 5% of the 400 million cups of coffee per day U.S. market.  This is 600 million cups of coffee per month requiring 22 billion gallons of water (at the 37 gallons of water per cup rate).  Starbucks five million gallons per month savings is roughly 0.0227% of the total coffee life-cycle water requirements.

Saving water is saving water, however the context is certainly important along with a clear and transparent view of the total production system.  Sustainability starts with a definition of the particular system boundaries and a life-cycle assessment.  None of this makes drinking coffee a bad choice: More important than any product's virtual water total is whether the region it comes from has sustainable water to grow the crop.  Starbucks is importing not only coffee, but also 22 billion gallons of water per month.

War Criminals For $500

Can you name the greatest invention of the last 100 or so years?  The automobile - - with its profound impact on our mobility?  What about the light bulb - - opening 50% of any given day?  A host of medicines - - saving so many countless lives?  It has to be the computer - - changing fundamentally the way we connect globally?  It just has to be the computer, correct?

What about an invention that most experts estimate to be responsible for two of every five humans on earth today?  This certainly beats the light bulb or my iPod by a huge margin on the global importance scale.  So what is this mystery invention?  Try the Haber-Bosch process.  This is the process that first produced synthetic nitrogen.  Before Fritz Haber's invention, the sheer amount of life on earth could support - - the size of crops and therefore the number of human bodies - - was limited by the amount of nitrogen that bacteria and lightening could fix.  Life without your laptop and iPhone - - probably.  Life without Fritz Haber, a German Jewish chemist - - improbable.

Why no Fritz Haber global celebration day or his picture on the cover of the John Deere annual report?  Why no Fritz Haber High School in Sioux City, Iowa?  He won the Noble Prize in 1920 - - but why this veil of obscurity regarding his life-giving achievements.  Probably because of his life-taking distinctions.

Herr Haber was the developer and keen overseer of the big three of poison gasses - - ammonia, chlorine, and the infamous Zyklon B (the favorite gas of The Fuhrer for use in the concentration camps).  After the first gas attack on April 22, 1915, when his wife a fellow chemist found out about his significant contributions to the gas efforts - - she killed herself with Haber's army pistol.  Haber died a broken man in 1934.

This is a good example of the potential duality of the technologist - - savior to 2/5's of the planet and giver of life and on Jeopardy as "War Criminals For $500."  Nitrogen itself is not a saint in this either - - see the duality of nitrogen in Jesus meets Judas.

The Corn Store - Energy

As I outlined yesterday, your local grocery store is about 25% corm.  Both politics and biology have played major roles in filling up the aisles with corn.  The other variable that allowed this to happen was energy.  Not just any energy, but cheap energy.  When you add together the natural gas in the nitrogen fertilizer to the fossil fuels it takes to make the pesticides, drive the tractors, and harvest, dry, and transport the corn, you find that every bushel of Iowa corn requires the equivalent of between a quarter and a third gallon of oil to grow it - - or around 50 gallons of oil per acre of corn.  Engineers would say that it takes more than a calorie of fossil fuel energy to produce a calorie of food (keep in mind that before the advent of chemical fertilizer, namely nitrogen, the typical Iowa farm produced more than two calories of food energy for every calorie of energy invested).  This all makes perfect sense, right up to the point of $150 per barrel oil (What about ethanol?  Using high BTU energy sources to produce, transport, and distribute low BTU energy sources has lots of lukewarm thinking embedded in it).

Every increase in productivity can be traced to an external input.  Engineers are more productive than we were 50 years ago namely because of a technology input - - we design things better and faster because of an external input of lines of computer code.  To run all those servers and workstations, it also took an input of cheap energy in the form of electricity.  Chicken consumption in the United States is up approximately 90% since 1980.  This is fundamentally a function of declining unit costs.  The primary external input that has produced this huge productivity increase is cheap energy (not much computer code regarding your basic chicken).  Cheap energy for food, climate control for confinement buildings, processing, and distribution - - the entire value chain is a function of cheap energy (Processing has benefited from low-skill, low-wage labor - - namely in the form of illegal immigrants - - that was another key input).

When you see huge productivity improvements - - think in terms of what were the external factors that produced the improvements.  Then ask - - are the inputs sustainable at the current production levels?

The Corn Store

The average American grocery store now carries 48,750 items, according to the Food Marketing Institute, more than five times the number in 1975.  The number speaks to two important issues.  The first is sustainability and our collective need to do more with less.  Where does 91 different shampoos fit into a more sustainable world?  This is probably an example of the type of question that any discussion over sustainability needs to address.  The second is the complex area of decision making.  Choice seduces the modern consumer at every turn - - especially down the supermarket aisles.  Do multiple alternatives produce an environment of people thinking that the perfect choice exists or does it just produce distress?  Send someone to the store to get the rather vague tube of "toothpaste" - - 93 varieties are available.  You will probably get a phone call on which one.  Juice - - the big six in 2004 has exploded to as many as 30 today.  Historically we have been able to link democracy (i.e., freedom) with capitalism (i.e., choose and diversity) in an environment of cheap energy and a view of unlimited resources.  Sustainability kind of spins this in different directions - - all at your local grocery store.  The grocery store is the perfect laboratory for the sustainability expert and the behavioral scientist.

A second issue related to sustainability is also at play in the grocery store numbers.  Our sea of supermarket diversity is rather misleading.  Most of the diversity boils down to one single species of plant - - Zea mays.  Approximately 25% of your grocery store is about corn.  From the pig to cow to cheese to milk to "fruit" drinks to soft drinks to beer.  Corn has a role.  From glucose syrup to HFCS to MSG to xanthan gum.  Your diverse grocery store probably had a start in an Iowa corn field.

Both economics and politics have produced our reliance and commitment to corn.  But biology played the most significant role.  In the 1950s, crop yield was typically in the 70 to 80 bushels per acre range.  Today we speak in terms of 200 bushels per acre.  The only other domesticated species ever to have multiplied its productivity by such a factor is the Holstein cow.  So we are getting much higher yields per acre.  But how?  Is is more kernels per cob or more cobs per stalk?  Neither - - the higher yield of modern hybrids stems mainly from the fact that they can be planted so close together, thirty thousand to the acre instead of eight thousand 50 years ago.  Hybrids have been bred for thicker stalks and stronger root systems, the better to stand upright in a crowd and withstand mechanical harvesting.

It will be very interesting to see how this plays out in a global environment of rising middle classes wanting more and more combined with a shift to interests in bio-fuels.  The paradox and problem with sustainability - - balancing expansiveness in the context of scarcity.

The Nine Eyes of Google Street View

Jon Rafman has a website dedicated to exploring the world of the different and unexpected - - pictures that the hardworking men and women at Google captured while producing their Google Street View - - The Nine Eyes of Google Street View.  Car crashes, aliens, dead bodies, fires, hold-ups - - and the most popular, the universal finger of goodwill.

Unexpectedly beautiful, beguiling and disturbing - - probably far more than what Google expected.  Compelling images of a compelling world.

Water Throughput

You can think of the hydrological cycle as small buckets of fast-recycling water spread very unfairly around the globe.  Norway has 82,000 cubic meters of renewable freshwater per person, while Kenya has just 830.  This unfair distribution of surface water is caused by the pattern of the global atmosphere circulation itself - - and climate change may have a significant disruptive influence on our current patterns of fairness and unfairness.

This is why fresh water throughput is more important than absolute volume.  Water volume in rivers at any point in time is small - - what is critical for humans and ecosystems is the overall system throughput - - how fast a water droplet flows down a river.  Our current water systems are "small storage" but "fast throughput" systems.  Our dams, reservoirs, and artificial impoundments history tells the story.  On a global basis, we have produced in our collective engineering histories a water storage system of only 7,200 cubic kilometers for a global water withdrawal rate of 3,800 cubic kilometers per year.  Roughly a two year average stored supply of water.  Granted, averages are misleading for resources such as water in which the micro drives the macro - - but it provides an important baseline when discussing climate change.  It also highlights the primary reason why our water throughput systems, where the atmosphere and rivers have no meaningful storage capacity in some parts of the world from which to draw water in dry times or hoard in wet times are so fundamentally vulnerable to potential shocks and changes in climate patterns that impacts the hydrological cycle.