Change

There are a lot of areas where the trend oscillates between two states. “Cloud computing” is somewhat new and somewhat trendy, but the “computers are expensive, bandwidth is cheap … centralize everything” and “computers are cheap, bandwidth is expensive … distribute everything” states haven’t changed. A VAX with its terminals or a Citrix farm with its thin clients. Better graphics today, but conceptually the same thing. The difference is marketing — I don’t believe they pushed VT100’s for the home market. SaaS has personal targets as well as commercial.

With these changes, there were winners and losers. Mainframes lost market-share as companies deployed desktop PCs. And now desktop PC vendors are losing market-share as “cloud” services become prevalent. Sucks on an individual level — for, say, the people IBM laid off as their mainframe business contracted — but it wasn’t the driving force behind a political movement.

Manufacturing moved overseas. Energy production moved overseas. Some manufacturing (electronics, for instance) are harder to bring back — we simply lack the knowledge and equipment to pick up manufacturing electronics. Beyond that, though, it is hard to compete with someone who can continually undercut you on cost. You can slap import tariffs on everything you see, but the Chinese government can force employees to work for less. And who wants to start paying MORE for the same stuff? That’s the other side of import duties that people fail to talk about — sure we can jack up the price of ‘stuff’ that comes in from overseas so domestically produced items are competitive … but unless you’re getting a serious raise to go with it, that means items become less affordable. Apart from political change, some manufacturing is apt to move back to personal production (i.e. I’ll 3D print any cheap plastic junk we used to ship in from overseas). And that will negatively impact some of the BRIC economies. The move to personal production may benefit American companies — they design the products, license out the print file, and you make it (or use the 3D printer at your public library to print it, or go to the 3D document centre at Staples).

Until about 3AM today, I thought we’d be seeing a similar apolitical shift in energy markets. The renewable energy tax credits got extended in a Congress where even the trivial faced unimaginable opposition. Personal energy production makes electric vehicles a lot more enticing — paying 20$ a week to the petrol station or 20$ a week to the electric company … not much immediate, tangible benefit. But using the electricity that I’m producing v/s paying 20$ a week to the petrol station – that’s a whole different story.

That shift had worrying geo-political implications — the Middle East isn’t stable, but the area is useful and there’s incentive on both sides to maintain some semblance of order. As demand for oil shifts, incentives change. Odd, to me, that someone who wants to levy tariffs to make American products competitive doesn’t agree with leaving tax incentives in place to promote domestically manufactured clean energy solutions. “Clean” coal, sure … but don’t give ’em a tax incentive to buy solar panels manufactured out on the West coast.

 

 

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