Wednesday, May 28, 2008
Wednesday, May 14, 2008
POWER YOUR CAR AND YOUR HOUSE FOR FREE
There are hybrids. There are electric cars that plug into a wall and get their juice from whatever mix the electric company is offering. And then there are electic cars that are charged by solar panels on the roof of one's house. They never need gas, and the power is free after the set-up cost.
We wondered: How tough is it to do this? Are electric cars hard to find? Is it difficult to get a rooftop solar collector set up? Here are the stories of two guys whose vehicles run on empty.
Darrell Dickey's story | Stephen Weitz's story | Alex Beamer's story
Darrell Dickey with his RAV4 EV and daughter Kyra.
Darrell Dickey: A New Car -- And Fuel for Life
Darrell Dickey regularly commutes to work 24 miles, one way, by bike. But when it's too cold or wet for the bike, or when he and his family travel long distances from their home in Davis, California, he drives a battery-powered electric vehicle that he charges with photovoltaic (PV) panels mounted on his garage roof.
"Five years ago, I spent about $45,000 and got a brand new car (the RAv4EV) and the solar system," he says. "We're still driving the car every day, and the solar system will continue to make fuel for whatever EV we drive in the future. For $45,000 we bought a new car and fuel for the rest or our lives."
In 1996, Dickey was invited to test-drive the GM "Impact", which he then leased for two years. (The Impact later became the EV1, the first modern electric vehicle.) "We loved that car and hated to give it back," he says. But the Toyota Rav4EV had just become available for purchase, so he bought the electric vehicle he is driving today.
Dickey says the inspiration to drive electric comes from having a child. "It would embarrass me to have to explain to my daughter why we continued to import and burn oil when we knew the consequences," he says. "Having no tune-ups and no trips to the gas station ever is just icing."
By installing a solar system atop his garage, Dickey took the next step in driving a totally clean car. "Now," he says, "I can deflect the comments that my 'electric' car is just a 'coal-burning' car. EVs are the ultimate flex-fuel vehicle. You can make electricity out of just about anything: sun, wind, natural gas, coal—even gasoline! Your fuel can be totally domestic, or in my case, totally local."
Asked how long it will take for the PV system to pay for itself, Dickey replies: "If we think of everything in terms of what it costs us in the short-term, we're screwed. It's the same argument people use against the Prius: When will it pay back in gas savings? But that only accounts for the money paid at the pump. What of the billions of dollars that leave our economy for oil, or the billions of our tax dollars that go toward tax incentives for oil companies? What of the cost of the military and the lives lost to protect our oil?"
But the short answer for the solar pay-back, he says, was "the instant I turned my system on." Dickey had been paying $75 a month for electricity. He took a loan out to buy the PV system, and pays $70 a month toward that loan. "My electricity and gasoline bills are now zero, and next year when my loan is paid off, this investment will be paying me probably for the rest of my life. My PV system covers the power for my home and my car. It displaces $90 worth of electricity and over $100 worth of gasoline every month. So my estimate of how long until the system pays for itself is no time at all!"
Dickey says the Rav4EV is the best car he's ever owned. "My wife commutes in it 40 miles a day, five days a week. We drive it for our weekend outings and it does errands that are too far or too bulky for the bicycle. It has never been tuned up, and I've spent about $50 total on it for maintenance. My wife has not been to a gasoline station in seven years and 70,000 commute miles—not once!"
Stephen Weitz's truck touts its own benefits.
Stephen Weitz: This Truck Runs on Sunshine
Stephen Weitz, who holds a Ph.D. in biochemistry, says four things prompted him to buy an electric truck and charge it with solar energy: 1) global warming and the National Academy of Sciences (NAS); 2) Albert Einstein; 3) nitrogen "overdose"; and 4) open habitat and species destruction.
"NAS began warning of the dangers of rising carbon dioxide levels on global temperatures due to the greenhouse effect years ago," says Weitz, who lives in Oakland, California. "And Einstein won the Nobel Prize for describing the 'photovoltaic effect,' inaugurating the age of quantum physics and making photovoltaic solar panels a theoretical possibility."
Regarding nitrogen overdose, scientists have been documenting that harmless nitrogen (air is 80 percent nitrogen) is converted into potent fertilizer by internal combustion engines. This fertilizer is then deposited on soils, harming native plant ecosystems and endangered species.
"Some call it drive-by ICE (internal combustion engine) extinction," Weitz says. "Using 'green fuels' like ethanol and biodiesel would continue the problem, and hydrogen fuel cells are no solution because they cost too much, they're less efficient than battery-powered vehicles, and hydrogen is made by stripping fossil fuels, which releases carbon dioxide and exacerbates global warming."
Weitz wanted a source of energy for his electric vehicle that didn't originate from combustion. "By putting solar panels on the roof of my house, I could make use of an endless energy supply to charge my electric vehicle and operate and heat the house. Your house and your vehicle are the two biggest contributors to global warming, so making both carbon neutral strikes at the heart of the problem."
Rooftop mounting of solar panels also eliminates the need to convert undeveloped habitat into solar generation facilities. "We need to save open space for ecosystems, and we have so many empty roofs across the nation," he says. He points out as well that terrorist attacks and earthquakes are less destructive when power generation is distributed diffusely, rather than in concentrated spots like nuclear power plants or nuclear waste disposal sites.
For his PV system, Weitz contacted NorCal Solar (www.norcalsolar.org), which lists state-approved contractors. He obtained multiple bids, arranged two site visits, and got a "significant" rebate from the state for installing the system. He has Time of Use metering, and in the summer he gets a greater dollars-per-kilowatt credit for his solar-generated electricity than he spends at night to charge his electric truck. "PG&E (the local utility) is happy because their peak power needs are highest when my solar panels are putting out the watts, and lowest at night when I'm charging. The PG&E bill for operating my house and electric vehicle is almost zero."
There are two types of EV's, he explains: highway capable battery electric vehicles (BEVs), and neighborhood electric vehicles (NEVs). "Buy only what you need," he advises." If you drive mostly around town and take long trips once a year, get an NEV and rent a car for the long trip. If you must do lots of freeway driving, buy a BEV—just realize it will cost more and use more energy."
Weitz searched the Web for his electric vehicle, and recommends eBay, www.evnut.com, and www.eaaev.org. "I was lucky and found one of the rare vehicles in the movie "Who Killed the Electric Car" that hadn't been crushed by the auto industry—a factory-built Chevy S10 pickup. I had it shipped from Arizona and an electrician installed a 220-volt charger in my garage."
Millions of Americans, Weitz says, want the option to drive on cleaner, cheaper, domestic electricity. Many have banded together in the nonprofit Plug In America (www.pluginamerica.org) to demand that automakers give consumers a choice.
Alex Beamer found his 1977 electric Chevy truck on the Internet.
Alex Beamer: Electric Truck and Wind Power for Him
In 1977, Alex Beamer bought Breitenbush Hot Spring, an old hot springs resort in the mountains of rural Oregon, about an hour east of the state capital, Salem, where he now lives and manages a natural foods store.
" At Breitenbush I helped create a community that sought to live lightly on the Earth and serve others as a healing retreat and conference center," he says. "In the early days of that adventure I worked a lot with developing alternative energy projects. I restored a 30-kilowatt small hydroelectric system, drilled wells into the geothermal aquifers, and used the hot water to heat our buildings, domestic hot water, and hot tubs." Breitenbush Hot Springs recently celebrated its 30th anniversary as a cooperatively owned business.
So Beamer was already predisposed to living sustainably when he decided to buy an electric truck and charge it with wind energy. But the thing that inspired him to get the electric truck was a sustainability conference where he heard a talk about peak oil.
On investigating if he could buy or convert a Toyota Prius into a plug-in hybrid, he found the technology wasn’t yet ready to use. He then looked into electric vehicles and found there were no assembly-line options at the time that worked for ordinary driving. "So I searched the Internet for conventional gasoline cars that had been converted to electric, and that’s when I ran across an ad for the electric truck I ended up buying.
"It’s a 1997 production vehicle made by Chevrolet, and it was ready to go when I bought it," he says. "They made about 1,500 of them. Most were leased vehicles that were collected at the end of the leases and crushed. A few, maybe 50 or 60, were sold privately. My truck and many like it were used for a few years, then developed some problems and were parked for years. A fellow in Mesa, Arizona who’s an electric vehicle advocate bought many of them and restored them. That’s where I bought mine: www.EVBones.com."
When Beamer bought the truck, he was already purchasing “greensource” electricity from PG&E, his local utility. “PG&E offers all its customers several choices of environmentally friendly electricity, and we chose greensource, which is 85 percent wind and 15 percent biomass. Using wind-generated electricity makes a whole lot more sense than coal, and the cost is comparable to conventional electricity. Conventional is 9.9¢ per kilowatt hour and greensource costs 10.7¢, so greensource is .8¢ more.” PG&E’s website for clean electricity options is here.
Beamer says there’s a lot of interest in electric vehicles but very few ‘good’ ones available today, and retrofitting a conventional car is time-consuming and expensive. “Hopefully in the near future there will be more choices,” he says, "once battery technology gets where it needs to be." Beamer says Tesla electric cars, which are now coming off the assembly line, are"“the most exciting thing happening now, but they’re very expensive." Here's a wide range of electric cars and conversions .
At the beginning of February Beamer turned off his home oil fired furnace and started using a ground loop heat pump system to heat the family home. "So now, since this system runs off electricity and our utility offers a clean electricity option, we run our whole household with wind powered electricity!"
We wondered: How tough is it to do this? Are electric cars hard to find? Is it difficult to get a rooftop solar collector set up? Here are the stories of two guys whose vehicles run on empty.
Darrell Dickey's story | Stephen Weitz's story | Alex Beamer's story
Darrell Dickey with his RAV4 EV and daughter Kyra.
Darrell Dickey: A New Car -- And Fuel for Life
Darrell Dickey regularly commutes to work 24 miles, one way, by bike. But when it's too cold or wet for the bike, or when he and his family travel long distances from their home in Davis, California, he drives a battery-powered electric vehicle that he charges with photovoltaic (PV) panels mounted on his garage roof.
"Five years ago, I spent about $45,000 and got a brand new car (the RAv4EV) and the solar system," he says. "We're still driving the car every day, and the solar system will continue to make fuel for whatever EV we drive in the future. For $45,000 we bought a new car and fuel for the rest or our lives."
In 1996, Dickey was invited to test-drive the GM "Impact", which he then leased for two years. (The Impact later became the EV1, the first modern electric vehicle.) "We loved that car and hated to give it back," he says. But the Toyota Rav4EV had just become available for purchase, so he bought the electric vehicle he is driving today.
Dickey says the inspiration to drive electric comes from having a child. "It would embarrass me to have to explain to my daughter why we continued to import and burn oil when we knew the consequences," he says. "Having no tune-ups and no trips to the gas station ever is just icing."
By installing a solar system atop his garage, Dickey took the next step in driving a totally clean car. "Now," he says, "I can deflect the comments that my 'electric' car is just a 'coal-burning' car. EVs are the ultimate flex-fuel vehicle. You can make electricity out of just about anything: sun, wind, natural gas, coal—even gasoline! Your fuel can be totally domestic, or in my case, totally local."
Asked how long it will take for the PV system to pay for itself, Dickey replies: "If we think of everything in terms of what it costs us in the short-term, we're screwed. It's the same argument people use against the Prius: When will it pay back in gas savings? But that only accounts for the money paid at the pump. What of the billions of dollars that leave our economy for oil, or the billions of our tax dollars that go toward tax incentives for oil companies? What of the cost of the military and the lives lost to protect our oil?"
But the short answer for the solar pay-back, he says, was "the instant I turned my system on." Dickey had been paying $75 a month for electricity. He took a loan out to buy the PV system, and pays $70 a month toward that loan. "My electricity and gasoline bills are now zero, and next year when my loan is paid off, this investment will be paying me probably for the rest of my life. My PV system covers the power for my home and my car. It displaces $90 worth of electricity and over $100 worth of gasoline every month. So my estimate of how long until the system pays for itself is no time at all!"
Dickey says the Rav4EV is the best car he's ever owned. "My wife commutes in it 40 miles a day, five days a week. We drive it for our weekend outings and it does errands that are too far or too bulky for the bicycle. It has never been tuned up, and I've spent about $50 total on it for maintenance. My wife has not been to a gasoline station in seven years and 70,000 commute miles—not once!"
Stephen Weitz's truck touts its own benefits.
Stephen Weitz: This Truck Runs on Sunshine
Stephen Weitz, who holds a Ph.D. in biochemistry, says four things prompted him to buy an electric truck and charge it with solar energy: 1) global warming and the National Academy of Sciences (NAS); 2) Albert Einstein; 3) nitrogen "overdose"; and 4) open habitat and species destruction.
"NAS began warning of the dangers of rising carbon dioxide levels on global temperatures due to the greenhouse effect years ago," says Weitz, who lives in Oakland, California. "And Einstein won the Nobel Prize for describing the 'photovoltaic effect,' inaugurating the age of quantum physics and making photovoltaic solar panels a theoretical possibility."
Regarding nitrogen overdose, scientists have been documenting that harmless nitrogen (air is 80 percent nitrogen) is converted into potent fertilizer by internal combustion engines. This fertilizer is then deposited on soils, harming native plant ecosystems and endangered species.
"Some call it drive-by ICE (internal combustion engine) extinction," Weitz says. "Using 'green fuels' like ethanol and biodiesel would continue the problem, and hydrogen fuel cells are no solution because they cost too much, they're less efficient than battery-powered vehicles, and hydrogen is made by stripping fossil fuels, which releases carbon dioxide and exacerbates global warming."
Weitz wanted a source of energy for his electric vehicle that didn't originate from combustion. "By putting solar panels on the roof of my house, I could make use of an endless energy supply to charge my electric vehicle and operate and heat the house. Your house and your vehicle are the two biggest contributors to global warming, so making both carbon neutral strikes at the heart of the problem."
Rooftop mounting of solar panels also eliminates the need to convert undeveloped habitat into solar generation facilities. "We need to save open space for ecosystems, and we have so many empty roofs across the nation," he says. He points out as well that terrorist attacks and earthquakes are less destructive when power generation is distributed diffusely, rather than in concentrated spots like nuclear power plants or nuclear waste disposal sites.
For his PV system, Weitz contacted NorCal Solar (www.norcalsolar.org), which lists state-approved contractors. He obtained multiple bids, arranged two site visits, and got a "significant" rebate from the state for installing the system. He has Time of Use metering, and in the summer he gets a greater dollars-per-kilowatt credit for his solar-generated electricity than he spends at night to charge his electric truck. "PG&E (the local utility) is happy because their peak power needs are highest when my solar panels are putting out the watts, and lowest at night when I'm charging. The PG&E bill for operating my house and electric vehicle is almost zero."
There are two types of EV's, he explains: highway capable battery electric vehicles (BEVs), and neighborhood electric vehicles (NEVs). "Buy only what you need," he advises." If you drive mostly around town and take long trips once a year, get an NEV and rent a car for the long trip. If you must do lots of freeway driving, buy a BEV—just realize it will cost more and use more energy."
Weitz searched the Web for his electric vehicle, and recommends eBay, www.evnut.com, and www.eaaev.org. "I was lucky and found one of the rare vehicles in the movie "Who Killed the Electric Car" that hadn't been crushed by the auto industry—a factory-built Chevy S10 pickup. I had it shipped from Arizona and an electrician installed a 220-volt charger in my garage."
Millions of Americans, Weitz says, want the option to drive on cleaner, cheaper, domestic electricity. Many have banded together in the nonprofit Plug In America (www.pluginamerica.org) to demand that automakers give consumers a choice.
Alex Beamer found his 1977 electric Chevy truck on the Internet.
Alex Beamer: Electric Truck and Wind Power for Him
In 1977, Alex Beamer bought Breitenbush Hot Spring, an old hot springs resort in the mountains of rural Oregon, about an hour east of the state capital, Salem, where he now lives and manages a natural foods store.
" At Breitenbush I helped create a community that sought to live lightly on the Earth and serve others as a healing retreat and conference center," he says. "In the early days of that adventure I worked a lot with developing alternative energy projects. I restored a 30-kilowatt small hydroelectric system, drilled wells into the geothermal aquifers, and used the hot water to heat our buildings, domestic hot water, and hot tubs." Breitenbush Hot Springs recently celebrated its 30th anniversary as a cooperatively owned business.
So Beamer was already predisposed to living sustainably when he decided to buy an electric truck and charge it with wind energy. But the thing that inspired him to get the electric truck was a sustainability conference where he heard a talk about peak oil.
On investigating if he could buy or convert a Toyota Prius into a plug-in hybrid, he found the technology wasn’t yet ready to use. He then looked into electric vehicles and found there were no assembly-line options at the time that worked for ordinary driving. "So I searched the Internet for conventional gasoline cars that had been converted to electric, and that’s when I ran across an ad for the electric truck I ended up buying.
"It’s a 1997 production vehicle made by Chevrolet, and it was ready to go when I bought it," he says. "They made about 1,500 of them. Most were leased vehicles that were collected at the end of the leases and crushed. A few, maybe 50 or 60, were sold privately. My truck and many like it were used for a few years, then developed some problems and were parked for years. A fellow in Mesa, Arizona who’s an electric vehicle advocate bought many of them and restored them. That’s where I bought mine: www.EVBones.com."
When Beamer bought the truck, he was already purchasing “greensource” electricity from PG&E, his local utility. “PG&E offers all its customers several choices of environmentally friendly electricity, and we chose greensource, which is 85 percent wind and 15 percent biomass. Using wind-generated electricity makes a whole lot more sense than coal, and the cost is comparable to conventional electricity. Conventional is 9.9¢ per kilowatt hour and greensource costs 10.7¢, so greensource is .8¢ more.” PG&E’s website for clean electricity options is here.
Beamer says there’s a lot of interest in electric vehicles but very few ‘good’ ones available today, and retrofitting a conventional car is time-consuming and expensive. “Hopefully in the near future there will be more choices,” he says, "once battery technology gets where it needs to be." Beamer says Tesla electric cars, which are now coming off the assembly line, are"“the most exciting thing happening now, but they’re very expensive." Here's a wide range of electric cars and conversions .
At the beginning of February Beamer turned off his home oil fired furnace and started using a ground loop heat pump system to heat the family home. "So now, since this system runs off electricity and our utility offers a clean electricity option, we run our whole household with wind powered electricity!"
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PAUL KRUGMAN
If Ben Bernanke manages to save the financial system from collapse, he will — rightly — be praised for his heroic efforts.
But what we should be asking is: How did we get here?
Why does the financial system need salvation?
Why do mild-mannered economists have to become superheroes?
The answer, at a fundamental level, is that we’re paying the price for willful amnesia. We chose to forget what happened in the 1930s — and having refused to learn from history, we’re repeating it.
Contrary to popular belief, the stock market crash of 1929 wasn’t the defining moment of the Great Depression. What turned an ordinary recession into a civilization-threatening slump was the wave of bank runs that swept across America in 1930 and 1931.
This banking crisis of the 1930s showed that unregulated, unsupervised financial markets can all too easily suffer catastrophic failure.
As the decades passed, however, that lesson was forgotten — and now we’re relearning it, the hard way.
To grasp the problem, you need to understand what banks do.
Banks exist because they help reconcile the conflicting desires of savers and borrowers. Savers want freedom — access to their money on short notice. Borrowers want commitment: they don’t want to risk facing sudden demands for repayment.
Normally, banks satisfy both desires: depositors have access to their funds whenever they want, yet most of the money placed in a bank’s care is used to make long-term loans. The reason this works is that withdrawals are usually more or less matched by new deposits, so that a bank only needs a modest cash reserve to make good on its promises.
But sometimes — often based on nothing more than a rumor — banks face runs, in which many people try to withdraw their money at the same time. And a bank that faces a run by depositors, lacking the cash to meet their demands, may go bust even if the rumor was false.
Worse yet, bank runs can be contagious. If depositors at one bank lose their money, depositors at other banks are likely to get nervous, too, setting off a chain reaction. And there can be wider economic effects: as the surviving banks try to raise cash by calling in loans, there can be a vicious circle in which bank runs cause a credit crunch, which leads to more business failures, which leads to more financial troubles at banks, and so on.
That, in brief, is what happened in 1930-1931, making the Great Depression the disaster it was. So Congress tried to make sure it would never happen again by creating a system of regulations and guarantees that provided a safety net for the financial system.
And we all lived happily for a while — but not for ever after.
Wall Street chafed at regulations that limited risk, but also limited potential profits. And little by little it wriggled free — partly by persuading politicians to relax the rules, but mainly by creating a “shadow banking system” that relied on complex financial arrangements to bypass regulations designed to ensure that banking was safe.
For example, in the old system, savers had federally insured deposits in tightly regulated savings banks, and banks used that money to make home loans. Over time, however, this was partly replaced by a system in which savers put their money in funds that bought asset-backed commercial paper from special investment vehicles that bought collateralized debt obligations created from securitized mortgages — with nary a regulator in sight.
As the years went by, the shadow banking system took over more and more of the banking business, because the unregulated players in this system seemed to offer better deals than conventional banks. Meanwhile, those who worried about the fact that this brave new world of finance lacked a safety net were dismissed as hopelessly old-fashioned.
In fact, however, we were partying like it was 1929 — and now it’s 1930.
The financial crisis currently under way is basically an updated version of the wave of bank runs that swept the nation three generations ago. People aren’t pulling cash out of banks to put it in their mattresses — but they’re doing the modern equivalent, pulling their money out of the shadow banking system and putting it into Treasury bills. And the result, now as then, is a vicious circle of financial contraction.
Mr. Bernanke and his colleagues at the Fed are doing all they can to end that vicious circle. We can only hope that they succeed. Otherwise, the next few years will be very unpleasant — not another Great Depression, hopefully, but surely the worst slump we’ve seen in decades.
Even if Mr. Bernanke pulls it off, however, this is no way to run an economy. It’s time to relearn the lessons of the 1930s, and get the financial system back under control.
More Articles in Opinion »
But what we should be asking is: How did we get here?
Why does the financial system need salvation?
Why do mild-mannered economists have to become superheroes?
The answer, at a fundamental level, is that we’re paying the price for willful amnesia. We chose to forget what happened in the 1930s — and having refused to learn from history, we’re repeating it.
Contrary to popular belief, the stock market crash of 1929 wasn’t the defining moment of the Great Depression. What turned an ordinary recession into a civilization-threatening slump was the wave of bank runs that swept across America in 1930 and 1931.
This banking crisis of the 1930s showed that unregulated, unsupervised financial markets can all too easily suffer catastrophic failure.
As the decades passed, however, that lesson was forgotten — and now we’re relearning it, the hard way.
To grasp the problem, you need to understand what banks do.
Banks exist because they help reconcile the conflicting desires of savers and borrowers. Savers want freedom — access to their money on short notice. Borrowers want commitment: they don’t want to risk facing sudden demands for repayment.
Normally, banks satisfy both desires: depositors have access to their funds whenever they want, yet most of the money placed in a bank’s care is used to make long-term loans. The reason this works is that withdrawals are usually more or less matched by new deposits, so that a bank only needs a modest cash reserve to make good on its promises.
But sometimes — often based on nothing more than a rumor — banks face runs, in which many people try to withdraw their money at the same time. And a bank that faces a run by depositors, lacking the cash to meet their demands, may go bust even if the rumor was false.
Worse yet, bank runs can be contagious. If depositors at one bank lose their money, depositors at other banks are likely to get nervous, too, setting off a chain reaction. And there can be wider economic effects: as the surviving banks try to raise cash by calling in loans, there can be a vicious circle in which bank runs cause a credit crunch, which leads to more business failures, which leads to more financial troubles at banks, and so on.
That, in brief, is what happened in 1930-1931, making the Great Depression the disaster it was. So Congress tried to make sure it would never happen again by creating a system of regulations and guarantees that provided a safety net for the financial system.
And we all lived happily for a while — but not for ever after.
Wall Street chafed at regulations that limited risk, but also limited potential profits. And little by little it wriggled free — partly by persuading politicians to relax the rules, but mainly by creating a “shadow banking system” that relied on complex financial arrangements to bypass regulations designed to ensure that banking was safe.
For example, in the old system, savers had federally insured deposits in tightly regulated savings banks, and banks used that money to make home loans. Over time, however, this was partly replaced by a system in which savers put their money in funds that bought asset-backed commercial paper from special investment vehicles that bought collateralized debt obligations created from securitized mortgages — with nary a regulator in sight.
As the years went by, the shadow banking system took over more and more of the banking business, because the unregulated players in this system seemed to offer better deals than conventional banks. Meanwhile, those who worried about the fact that this brave new world of finance lacked a safety net were dismissed as hopelessly old-fashioned.
In fact, however, we were partying like it was 1929 — and now it’s 1930.
The financial crisis currently under way is basically an updated version of the wave of bank runs that swept the nation three generations ago. People aren’t pulling cash out of banks to put it in their mattresses — but they’re doing the modern equivalent, pulling their money out of the shadow banking system and putting it into Treasury bills. And the result, now as then, is a vicious circle of financial contraction.
Mr. Bernanke and his colleagues at the Fed are doing all they can to end that vicious circle. We can only hope that they succeed. Otherwise, the next few years will be very unpleasant — not another Great Depression, hopefully, but surely the worst slump we’ve seen in decades.
Even if Mr. Bernanke pulls it off, however, this is no way to run an economy. It’s time to relearn the lessons of the 1930s, and get the financial system back under control.
More Articles in Opinion »
Thursday, March 20, 2008
Tuesday, March 18, 2008
Monday, March 17, 2008
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