Centennial Coal’s Chairman, Kenneth Moss, did not only have to allay shareholders’ concerns about the fact more than $310 million had been wiped from the coal producer’s market value in just over a week. He also had to face about six Greenpeace protesters breaking into what Centennial had been told was the “most secure room in Sydney” to tell him why they opposed plans for its Anvil Hill open-pit mine in the Upper Hunter.

After the protesters were forcibly removed by police without charge, Mr Moss admitted the events of the past year had been “extremely unsatisfactory”. Last week Centennial slashed its profit forecast for the full year and revealed it would close three mines by 2008, including the Newstan operation in the Newcastle coalfield, which managing director Bob Cameron said was a “millstone around our necks”.

The Sydney Morning Herald, 25/11/2006, p. 43

China has indicated that it will continue to accumulate dollars, but at a slower rate by trading some of the dollars for other currencies.

On December 18 Iran announced that it will cease to use the US dollar as reserve currency.

On December 28 United Arab Emirates, a close US ally, announced that the weakening US dollar has caused its central bank to move some of its foreign exchange reserves from dollars to Euros.

The decisions of foreign central banks to reduce the rate at which they acquire dollars implies higher US interest rates at a time when the US economy is slowing, making it difficult for the Federal Reserve to ease monetary policy and more expensive for the US to borrow.

If foreigners take the next step and begin dumping their dollar holdings, there is nothing the US government can do to avert the catastrophe. Washington must take steps before it is too late.

The only timely solution is to reduce the US budget deficit. This requires Congress to cut spending or raise taxes or both. Raising taxes on a weakening economy is not a good idea. As entitlements
(Social Security and Medicare) comprise most of nondefense spending, the easiest step for Congress to take is to stop funding Bush’s pointless war. With less red ink to be financed, there would be less pressure on the dollar.

It is possible that Washington has waited too long to address the dollar problem. If 2007 brings recession to the US, the rise in the budget deficit from the loss of tax revenues could offset deficit reduction achieved by ending the war.

Many economists offer false solutions. We hear, for example, that a weaker dollar will lead to more exports and a reduction in the US trade deficit. This “solution” overlooks the impact of offshoring. With so many US brand name manufactures now produced offshore, there is less for the US to export. Some economists still believe that the gap can be filled by the export of services, but offshoring has also taken its toll on professional services. The US cannot simultaneously offshore the production of goods and services and reduce its trade deficit.

Other economists still think that the Federal Reserve can rescue the dollar by raising interest rates, thus making US Treasuries more attractive to foreigners. However, the US economy shows many signs of weakening. By stifling growth or provoking recession, higher interest rates can simply generate more red ink that must be financed by foreign borrowing, thus increasing the pressure on the dollar.

The US cannot afford the Iraq war, and it cannot afford the distraction from the serious economic problems that a war-obsessed government has permitted to accumulate. Offshoring is destroying the ladders of upward mobility that made America an opportunity society.

Economists, in their commitment to offshoring, offer “solutions” that conceal offshoring’s real impact on Americans. For example, we are told that education is the solution to “America’s competitiveness problem.”

People who advance the education solution are obviously unfamiliar with the character of US job growth in the 21st century and with the Bureau of Labor Statistics’ predictions of the areas of job growth over the next decade.

The problem America faces is not a lack of educated people, but a lack of jobs for educated people. In the 21st century, the US economy has been able to create net new jobs only in domestic services, such as waitresses, bartenders and health and social services. The vast majority of these jobs do not require a college education, and they do not produce tradable goods and services that could be exported or substituted for imports. Income inequality is worsening as CEO pay soars while median income stagnates.

This new year will be the fifth year that the American people will have let President Bush commit their country to an illegitimate war that cannot be won. Will the US extract itself from Bush’s misadventure and address its real problems, or will the dollar’s decline bring new economic hardships?

Wireless networking

Mr Negroponte told the Associated Press news agency that three more African countries might sign on in the next two weeks.

The laptop is powered by a 366-megahertz processor from Advanced Micro Devices and has built-in wireless networking.

It has no hard disk drive and instead uses 512 MB of flash memory, and has two USB ports to which more storage could be attached.

"I have to laugh when people refer to XO as a weak or crippled machine and how kids should get a "real’ one"," Mr Negroponte told AP.

"Trust me, I will give up my real one very soon and use only XO. It will be far better, in many new and important ways."

The computer runs on a cut-down version of the open source Linux operating system and has been designed to work differently to a Microsoft Windows or Apple machine from a usability perspective.

Instead of information being stored along the organising principle of folders and a desktop, users of the XO machine are encouraged to work on an electronic journal, a log of everything the user has done on the laptop.

The machine comes with a web browser, word processor and RSS reader, for accessing the web feeds that so many sites now offer.

"In fact, one of the saddest but most common conditions in elementary school computer labs (when they exist in the developing world), is the children are being trained to use Word, Excel and PowerPoint," Mr Negroponte said.

"I consider that criminal, because children should be making things, communicating, exploring, sharing, not running office automation tools."

The new user interface, known as Sugar, has been praised by some of the observers of the One Laptop Per Child project.

It doesn’t feel like Linux. It doesn’t feel like Windows. It doesn’t feel like Apple," said Wayan Vota, who launched the OLPCNews.com blog and is also director of Geekcorps, an organisation that facilitates technology volunteers in developing countries.

"I’m just impressed they built a new (user interface) that is different and hopefully better than anything we have today," he said.

But he added: "Granted, I’m not a child. I don’t know if it’s going to be intuitive to children."

Trial versions of the operating system in development can be downloaded to be tested out by technically-minded computer users around the world.

Xcel Energy, which serves eight states from North Dakota to Texas and says it is the nation’s largest retailer of wind energy, is eager to have more. Wind is “abundant and popular,” said Richard C. Kelly, the chairman, president and chief executive, speaking at a recent conference on renewable energy.

But Frank P. Prager, managing director of environmental policy at the company, said that the higher the reliance on wind, the more an electricity transmission grid would need to keep conventional generators on standby — generally low-efficiency plants that run on natural gas and can be started and stopped quickly.

He said that in one of the states the company serves, Colorado, planners calculate that if wind machines reach 20 percent of total generating capacity, the cost of standby generators will reach $8 a megawatt-hour of wind. That is on top of a generating cost of $50 or $60 a megawatt-hour, after including a federal tax credit of $18 a megawatt-hour.

By contrast, electricity from a new coal plant currently costs in the range of $33 to $41 a megawatt-hour, according to experts. That price, however, would rise if the carbon dioxide produced in burning coal were taxed, a distinct possibility over the life of a new coal plant. (A megawatt-hour is the amount of power that a large hospital or a Super Wal-Mart would use in an hour.)

Without major advances in ways to store large quantities of electricity or big changes in the way regional power grids are organized, wind may run up against its practical limits sooner than expected.

At a recent discussion of clean energy technologies held at General Electric’s research center in Niskayuna, N.Y, Dan W. Reicher, a former assistant secretary of energy for conservation and renewable energy, predicted that renewables, led by wind, could reach 20 percent of demand in the next decade or two. President Bush has also said that wind could supply 20 percent of the nation’s electricity.

But Mr. Reicher drew a quick response from James E. Rogers, chief executive of Duke Energy, one of the nation’s largest utilities, and chairman of the Edison Electric Institute, the industry’s trade association. “I love his optimism,” Mr. Rogers said. “But unfortunately, I have to deliver electricity every day.”

Mr. Rogers said that wind and another big renewable source that is available only when nature cooperates, solar power, will be necessary because the government would eventually regulate carbon emissions from coal-fired power plants. He later said that his reply to Mr. Reicher had been a “cheap shot,” but he and others are still wondering how much wind the nation can absorb.

General Electric, a major maker of wind machines, says that along with lowering the price for a megawatt-hour, engineers have made other improvements in wind machines. With better electronic controls, many of them now help stabilize voltage on the grid, and have been cured of their tendency to shut off when detecting a voltage fluctuation, a problem that can escalate into a blackout.

Juan de Bedout, manager of the electric power and propulsion systems lab at G.E., said this was more important now because wind machines had grown from a few hundred kilowatts to 1.5 megawatts, and his company was exploring machines four times bigger than that. “That’s ginormous,” he said.

In many places, wind tends to blow best on winter nights, when demand is low. When it is available, power from wind always displaces the most expensive power plant in use at that moment. If wind blew in summer, it would displace expensive natural gas. But in periods of low demand, it is displacing cheap coal.

And in places where suppliers enter bids each day to supply power on the next day, on an hour-by-hour basis, wind is at a disadvantage. Wider use of wind requires the invention of a new kind of weather forecasting, according to the Electric Power Research Institute, a nonprofit consortium based in Palo Alto, Calif., sponsored by the utility industry and its suppliers. Rather than forecasting from temperature or rainfall, what is needed is a focus on almost minute-by-minute predictions of wind in small areas where the turbines are.

The economics of wind would change radically if the carbon dioxide emitted by coal were assigned a cash value, but in the United States it has none. Coal plants produce about a ton of carbon dioxide each megawatt hour, on average, so a price of $10 a ton would have a major impact on utility economics.

Another possibility is energy storage, although this presents other difficulties.

In May, Xcel and the Energy Department announced a research program to use surplus, off-peak electricity from wind to split water molecules into hydrogen and oxygen. The hydrogen could be burned or run through a fuel cell to make electricity when it was needed most. Xcel plans to invest $1.25 million, and the government $750,000. But storage imposes a high cost: about half the energy put into the system is lost.

The Electric Power Research Institute said that existing hydroelectric dams could be used as storage; they can increase and decrease their generation quickly, and each watt generated in a wind machine means water need not be run through the dam’s turbines; it can be kept in storage, ready for use later, when it is most needed.

The institute listed another possibility, still in the exploratory stage: using surplus electricity made from wind to pump air, under pressure, into underground caverns. At peak hours, the compressed air could be withdrawn and injected into generators fired by natural gas. Natural-gas turbines usually compress their own air; compression from wind would cut gas consumption by 40 percent, the institute said.

That would help with an important goal, reducing consumption of natural gas, which is increasingly scarce and costly in North America. But not everyone is so sanguine that wind will do that.

Paul Wilkinson, vice president for policy analysis at the American Gas Association, the trade group for the utilities that deliver natural gas, said that wind, while helpful in making more gas available for home heating and industrial use, would still need a gas generator to back it up. And the units used as backup are generally chosen for low purchase price, not efficient use of fuel.

At the American Wind Energy Association, Robert E. Gramlich, the policy director, said that one solution would be to organize control of the electric grid into bigger geographic areas, so that a drop-off in wind in one place would be balanced by an increase somewhere else, reducing the need for conventional backup. That is among several changes the wind industry would like in the electric system; another is easier construction of new power lines, because many of the best wind sites are in prairies or mountain ranges far from where the electricity is needed.

A problem for new power lines is that they would be fully loaded for only some of the year, since the amount of energy that the average wind turbine produces over 12 months is equal to just 30 to 40 percent of the amount that would result from year-round operation at capacity. That number runs closer to 90 percent at a nuclear or coal plant.

Thus a 1,000-megawatt nuclear plant will produce nearly three times as much electricity as 1,000 megawatts of wind turbines. But operating costs at the wind farm are lower, and the fuel is, of course, free.

Iraq’s deposed president, whom Osama bin Laden called "the worst Arab despot" should have faced real justice at an international legal tribunal like the UN Hague Court. That would have served warning to other despots who violated human rights and committed aggression.

The United States did right to hand over Serb tyrant Slobodan Milosevic to the Hague. But Saddam had to be silenced before he told the world about his long collusion with the United States. Dead men tell no tales.

Saddam’s biggest crime was not killing rebellious Kurds or Shia. As ruler of the unnatural, British-created Frankenstein state Iraq, Saddam was forced to keep putting down rebellions.

Saintly Winston Churchill authorized the RAF to bomb Iraq’s rebellious Kurdish tribesmen with poison gas — exactly as Saddam later did. Saddam’s most brutal repression of Kurds and Shia occurred when they revolted during Iraq’s wars with Iran and the U.S.

Saddam should have faced trial for his unprovoked 1980 aggression against Iran that ended up causing one million dead and wounded.

But in this crime, Saddam was covertly backed by his principal accomplices, the U.S. and Britain. Donald Rumsfeld even went to Baghdad to offer Saddam arms, finance and intelligence. Hanging Saddam eliminated the main witness.

Saddam was helped into power by the CIA, which stood by while he slaughtered Iraqi communists and Nasserites.

The U.S. and Britain, as I discovered in Baghdad in 1990, supplied Saddam with poison gas and germs to make battlefield weapons (these were not "weapons of mass destruction." The germs were never successfully weaponized).

So long as Saddam was killing and torturing people America and Britain did not like, he was "our SOB."

But when Saddam grew too big for his britches and invaded Kuwait, he went from being the West’s regional bullyboy to devil No. 1.

Once he touched the West’s oil in Kuwait, he was marked for death.

Some of the tame U.S. media have been spinning Saddam’s execution as a justification for the Bush/Cheney administration’s unprovoked invasion of Iraq, without ever asking why Saddam was an ally in 1988 yet a devil in 1991 and again in 2003.

Nor has there been much reporting that under Saddam, Iraq became the Arab world’s most industrialized nation, a leader in women’s rights, medical care, education, and public projects.

Back in 2003, I predicted that once the U.S. got rid of old pal Saddam, it would look for another Saddam-clone to replace him. The mutant state of Iraq and its feuding peoples can only be ruled by an iron fist. Saddam’s greatest error was believing he had frightened Iraqis into a national unity that would support invasions of his neighbours. He was dead wrong.

There are plenty of other brutal regimes that rival Saddam’s Iraq for nastiness. Most are close U.S. allies. As Henry Kissinger once quipped, being America’s ally is far more dangerous than being its enemy.

After jubilation among Shia and Kurds over Saddam’s execution subsides, Iraq will return to its daily bloody chaos. Saddam called himself a martyr. In years to come, many Arabs will forget his many crimes and remember him as a flawed hero and martyr who dared challenge the United States and Israel, and paid the price for his audacity.

On one side of the conflict there is, improbably enough, the Communist Party of India (Marxist) and its leader, Buddhadeb Bhattacharjee, chief minister of West Bengal State, for whom the auto plant at Singur, 22 miles west of Calcutta, represents the beachhead of industrial resurgence.

To that end, the state government has recently fenced off the land, deployed hundreds of state police officers and private guards on its perimeter, and, to stave off protests, banned assemblies of five or more people in villages nearby.

The stakes for Mr. Bhattacharjee, 62, a Communist Party stalwart who has of late aggressively courted private investment, could not be higher. And that shows in his zeal.

“All leading investors are closely watching whether the government will fail to start this project,” he said in an interview. “For us, there is no space. We just cannot roll back. It will send a bad message all over the country and the world.”

His message is stark and simple: West Bengal, a symbol of strife and ruin for more than 30 years whose capital, Calcutta, was once called “a dying city” by Rajiv Gandhi, the former prime minister, is once again open for business.

It is for this reason, not to mention his party’s iron hold on this state since 1977, that Mr. Bhattacharjee is sometimes regarded as the Chinese-style leader among Indian Communists. He has staked his reputation on promoting industrial growth. He has embraced privatization of state-run enterprises. He has scolded trade unions. He has criticized the general strikes that shutter this city for at least a couple of days each year. He has welcomed foreign multinationals. Money, he declared this year, has no color.

“We committed some mistakes in the past,” he said of the Communist tenets of yesterday. “Now I can humbly say our policy has changed.”

If Mr. Bhattacharjee’s government sees the car plant as “the flagship project” of a rising West Bengal — more hammer, less sickle, one might say — his critics, who range from the political opposition to advocates of peasants’ rights, are equally confident that the industrial project will bring ruin. They accuse him of railroading people into selling their farmland, and of neglecting those who survive on it, chiefly laborers and sharecroppers.

That the land here is particularly rich, at times producing three or four crops a year, has made the fight more intense. In recent weeks, protests against the project have spilled into Calcutta, further snarling traffic in the city center and, in December alone, prompting three general strikes.

Tensions flared in mid-December, when the body of a teenage girl who had protested the project was found inside the fenced perimeter of the factory site, strangled and burned.

In Singur, a village pressed against that fence, resignation is mixed with rage. Graffiti on the side of one building screams: “Look around. Identify the stooges of Tata.”

Singur is sharply divided between those who said they agreed to sell their land, and those who held out. The happiest are those like Nimai Chandra Mukherji, 71, a retired civil servant, who long ago gave up tilling his land and rented it to sharecroppers. For page 2 of article, go to New York Times

 

Also posted at IHT. The story is receiving much coverage, including: an online documentary and an editorial in the Hindustan Times.