James A. McClure

I think solar power is a great idea. Free electricity: how cool is that? I’d love to use it at home because my house is an ideal solar site:, with a big flat roof under a New Mexico sun that shines 300-plus days a year.

Problem is, it’s too expensive. The last time I checked, converting my house to solar power would require an investment of tens of thousands of dollars. Even with the savings on utility bills and all those tax credits, it would take as much as a decade to recover my costs. I could break even about the time they wheel me off to a nursing home.

I suspect that one reason why solar power is expensive is because solar equipment still lacks the economies of scale needed to make it affordable. The more of something you manufacture, the lower the cost of each unit. That’s why many things that used to be expensive, like flat-screen TV sets and cell phones, are now available at WalMart.

Solar energy is still overpriced despite years of government subsidies. At this point the biggest reasons to go solar are noneconomic: ecological guilt and government mandates. My utility company offered me a deal a couple of years ago to pay a voluntary surcharge for the assurance that some of my electricity would come from renewable sources. Seriously? My bills are likely to go up anyway because of government mandates that utilities use more solar and wind power. Forcing us to pay more for something because it’s good for us is not a compelling strategy.

The telecommunication industry faced a similar dilemma in the 1990s. Fiber optic cable was many times more efficient than copper cable, but the stuff was expensive. That was frustrating to telcom executives who wanted to convert more of their networks to fiber but could not justify its cost. Ameritech solved the problem by offering long-term, large-scale contracts to suppliers who could offer fiber cable at a price comparable to copper. Suppliers jumped at the deal because the long-term contracts enabled them to expand their manufacturing volume and achieve lower costs.

Government programs to encourage renewable energy may be falling short because they tend to focus on subsidizing manufacturing and creating artificial demand without reducing costs. There is a lot government can do by focusing its efforts on the areas where government is most effective.

It makes sense for the government to fund research, because research grants and subsidized national laboratories can perform more basic research and development than most private companies can afford.

Government also can create markets in its role as the biggest customer in the country for practically everything. Instead of paying companies like Solyndra to build luxurious factories in expensive locations, I’d like to see the feds announce a program to spend, say, $500 million a year for the next five years to convert government buildings to solar power and award contracts to the lowest bidders.

Companies with the winning bids could then raise private capital to build factories, with investors looking over their shoulders to ensure that the companies are managed prudently. The likely outcome is that a lot more solar panels would be manufactured and, as a result, costs would go down. Not only would the government get something for its money (for once), but solar panels would be more affordable for the rest of us.

Politics is my favorite spectator sport. It’s often amusing, a little like watching monkeys at the zoo. But when politicians tinker with the economy they’re downright scary. The continuing recession (or recovery, depending on which party is talking) means that the economy will be a political football until the November election.

Most of us don’t fully understand the economy. I sure don’t. But the economic causes and solutions we’re hearing from the politicians set off my bullshit alarm practically every day. Every government attempt to fix the economy, especially in recent years, seems to result in unintended consequences. The only certainty seems to be that you get more of what you subsidize and less of what you tax.

The economists are no help. Every approach to the economy, however loony, is supported by at least one professor of economics. Want to starve a bunch of economists? Lock them in a room until they agree on a pizza order.

So we hear economists and politicians urging the kind of central planning and government spending that is bankrupting Europe. Some want us to emulate China, where a planned economy is headed for a crash and the high-speed trains already are crashing. Others urge a return to Reaganomics, which grew the economy in the 1980s but resulted in leveraged buyouts, junk bonds, and the migration of talent from productive business to the financial sector. All of this politico-economic blather is filtered through the lens of a mostly partisan news media.

A political campaign ought to focus on ideas about the economy and the government’s role in it. Can we reform the tax code to tax entrepreneurs at a lower rate than hedge-fund managers? Must energy policy and environmental protection remain mutually exclusive? Can a targeted job training program help unemployed workers qualify for all those unfilled manufacturing jobs? How can government and the banks team up to allow the housing market to hit bottom with a soft landing for homeowners?

But we’re not going to hear any ideas, are we? Instead, the economy will be fair game for demagoguery such as the attack on capitalism by Republicans who claim to support a free-market economy. Newt Gingrich and Rick Perry in particular revealed their ignorance of business and disdain for the private sector when they attacked Mitt Romney for Bain Capital’s corporate reorganizations. Just think what we’ll hear from the Democrats.

As I understand it, Romney did the same thing my neighbor does when he flips houses. This neighbor bought the crappiest house on the block and invested in a major rehab. In the process he scrapped the inefficient furnace and outdated cabinets, and that sounds like what Bain Capital did to turn around failing companies. Wonder if the executive branch of the federal government could use some remodeling?

The vulture-capitalist schtick is only the beginning. We’re going to hear that Democrats want a socialist system that will bankrupt the economy, and that Republicans want to help millionaires oppress the middle class and cancel Grandma’s Medicare.

It’s going to be a long, depressing campaign. What few economic ideas emerge will be written in crayon.

It must be tough for this season’s new TV shows to compete with the soap opera of the Occupy Wall Street protests. Tents! Drums! Anarchists with iPhones! Convoluted speeches and loony signs! Celebrities and the homeless! Liberal mayors unleashing the cops! You can’t make this stuff up.

What’s nearly as entertaining as the Monty Python antics of the protesters is the strained attempts of the news media and politicians to take them seriously. The consensus seems to be that the occupiers are similar to the Tea Party as an expression of economic discontent, which is like comparing Spring Break to a Realtors’ convention.

Tea Party envy may be driving union bosses and liberal politicians to gingerly embrace the occupiers. There also may be some nostalgia for the anti-war protests of my generation that changed the world and elected Richard Nixon. (I missed out on those because I was in Vietnam.)

Albuquerque’s protest, with a distinctive New Mexico spin, is called (Un)Occupy Albuquerque in recognition of New Mexico’s historic occupation by the Spanish and Anglos. This implies that the place actually belongs to the Indians, but no Native Americans appear to be participating in the protests. Perhaps they’re busy running their casinos.

To better understand the protesters’ demands, I checked the movement’s web site — http://www.occupytogether.org/ — and learned that the occupiers blame corporations for all the ills of the world. They do not advocate any specific solution, such as electing a president who will unleash the power of government to defeat the corporations. Didn’t we already do that?

There are some legitimate issues in there somewhere that many of us might support, but at this point the protesters are not saying much about the economy. Instead, the protest itself has become the cause as occupiers fight for their constitutional right to sleep in the park. This strategy has been a spectacular success in mobilizing the homeless. Why stay in a boring shelter when you can hit on college students, get free food and maybe get on television?

In Albuquerque, the protesters wore Day of the Dead costumes (big holiday here) to mourn the death of their civil rights. One protester claimed they were standing up for their First and Second-Amendment rights (which is a little odd because New Mexico does not require gun registration). Another got on every newscast by announcing a hunger strike until the university president meets with him. The whole issue may wind up in court because the protesters have lawyers. Is this a great country, or what?

All of this is great theater, but whether it can change the course of the nation remains to be seen. The Tea Party had the right idea: They came, they protested and then they went home. Now they occupy the House of Representatives.

The feds filed an antitrust suit to block AT&T’s acquisition of T-Mobile. The Department of Justice claims the merger will limit consumer choice and raise prices for cell phone service. My local state regulatory commissioner welcomed the suit because it will keep AT&T from “monopolizing” cell service.

Here we go again. I worked for the Bell System when the feds brought the last antitrust suit against AT&T in the 1970s, ostensibly for the same reasons. Except it wasn’t really about consumers: Start-up competitors wanted a piece of the lucrative business market in data communications and large businesses wanted more choice in telephone equipment.

Suddenly it was open season on AT&T. Dozens of start-up companies entered the long-distance business and immediately filed their own antitrust suits. Even though consumers were highly satisfied with their own phone service, consumer organizations joined the hue and cry because, well, AT&T was just too damned big.

That antitrust suit was settled when AT&T spun off its two-dozen local phone companies in 1984. I tracked public opinion as Illinois Bell’s survey research guy and noticed a sudden shift a couple of months before the divestiture took effect. Consumers who had overwhelmingly favored breaking up AT&T had an epiphany (and a cow) when they realized how the change would affect them: You mean I have to have different phone companies for local and long distance service? I have to buy my own phone? What a dumb idea! Why didn’t someone tell us about this? They were even more disappointed when the overall cost of residential phone service did not come down and the cheap phones from Best Buy kept breaking.

After the breakup federal and state regulators created “competition” by forcing AT&T and the Baby Bells to sell service at a discount to wholesalers who would resell the service to consumers, essentially carving up the market. Long distance companies like MCI and Worldcom (remember Worldcom?) built their own networks, but anyone with a lawyer and a pulse could start a company to resell phone service with minimal investment. Dozens of government-anointed “competitors” went into the telephone business, failed to attract customers and died like corporate fruit flies. The lawyers did okay, though.

It was technology and the marketplace, not government regulation, that ultimately brought genuine competition to telecommunications. Today I can get telephone service from a wireline phone company, a cable TV company or any of the six cell phone providers in my city. The Internet has made long distance service, once the cash cow of telecommunications, virtually free and wireline service is disappearing. Consumers have a dizzying array of choices and there’s an app for anything you can dream of communicating.

All of this innovation and competition makes it hard for the feds to find monopolies from which to protect the public, so they have to settle for taking down market leaders instead. Hence the antitrust suit to block AT&T’s merger with T-Mobile even though the battle cry of “monopoly” rings a little hollow. It’s more like suing General Motors to protect Studebaker.

If increasing competition and consumer choice were the objective, the government could easily free up more radio spectrum for telecommunications entrepreneurs. Instead, the feds are taming the unruly telecommunications marketplace by picking winners and losers for us. In this case the winners are Verizon and Sprint, which clearly have the best lobbyists. The designated loser is AT&T, which unwisely retained its monopoly-tainted moniker when it was acquired by SBC and should have spent more on lobbyists.

In another solution looking for a problem, the Federal Communications Commission is proposing to regulate the Internet. So it’s déjà vu all over again. The silver lining is that whenever the government tries to regulate technology, technology invariably wins. The lawyers do okay, too.

Another election campaign is starting, and that means politicians will be telling us that they are standing up for the middle class (and that the other politicians are not). Knowing what class you’re in is important these days because class warfare has become a standard feature of political campaigns. The middle class clearly is the place to be unless you’re Warren Buffett or Bill Gates.

Problem is, the definition of the middle class keeps changing. When I studied sociology in college the middle class was defined specifically as people who had acquired education and specialized skills and worked as professionals, small business owners and skilled tradespeople. Sociologists conducted elaborate studies to further stratify the middle class into upper-middle, lower-middle and the ever-popular middle-middle. Still, everyone agreed that Ward and June Cleaver were middle class and Ralph Kramden was not.

Those tidy class distinctions have eroded. Auto assembly-line workers began identifying themselves as middle class once they could afford Winnebagos. Now the middle class has been hijacked by the politicians.

During the 2008 election the middle class suddenly expanded to practically the entire population from just above the poverty line to the six-figure-salaried. It was a little like Garrison Keillor’s Lake Wobegon, where all the children are above average.

That definition is slipping, however. The government workers who disrupted Wisconsin claimed that they are the middle class, which implies that the ordinary taxpayers who voted Republican are not. Then there’s the 50 percent of the population that pays no federal income tax: Are they middle class? And how do we categorize the Tea Party people and the illegal immigrants? It’s all very confusing.

It gets worse. The traditional middle-class definition includes doctors, business owners and lawyers, some of whom earn more than $250,000 a year. Are these folks still in the middle class, or are they now on the other side of the class divide along with those millionaires and billionaires who ought to pay higher taxes?

The 2012 election campaign is just beginning, and new and exciting definitions of the middle class are bound to emerge. It’s enough to drive a sociologist to drink.