ECONOMIC GROWTH and technological innovation are directly related to the availability of low-cost electricity. Each percentage increase in real GDP between 1970 and 2000 has resulted in a 1 percent rise in demand for electricity. Not surprisingly, the price of electricity is one of the determinants of the competitiveness of industries, with the
Nuclear power, which supplies 20 percent of the
Sources such as solar and wind are intermittent and unreliable and cannot replace reliable base load sources such as hydro, fossil and nuclear. Yet many of our feckless politicians and folks in the environmental movement and in media say we can do without nuclear power. But as time goes on the logic has to emerge. It is not logical to assert that climate change is the most important issue of our time and that reducing fossil fuel usage is the principal aim and then thwart the very technology that best accomplishes that. From
The Long View
TURMOIL IN THE CREDIT MARKETS coupled with the implosion of housing has triggered a precipitous contraction of liquidity and concerns that a recession is upon us. Chief Executive’s own CEO Confidence Index showed the largest one-month drop in August since we began tracking sentiment in October 2002. Yet having endured six financial meltdowns since Penn Central’s demise in 1970, we should keep a perspective. A lack of liquidity in mortgage securities may depress housing prices further, but the impact may not be so severe as to force the economy into recession. Job growth has been positive, with even a modest decline in the unemployment rate. In prior housing downturns, the jobless rate peaked by 3 percentage points in the 1980s and 2.2 percentage points in the 1990s.
In addition, most analysts are sanguine about continued growth in the world economy. Given that the market capitalization of the