North America, South America

RoRoRo Your Car

By far the biggest advantage that a large truck has over a small truck is that a large truck has lower labour costs, per unit of cargo transported. Self-driving technologies that reduce or eliminate labour costs may therefore lead to an increased use of smaller trucks.

This could be particularly likely to occur in areas that have rugged terrain, where labour costs tend to be especially high as a result of slower driving speeds and higher insurance costs.

Small vehicles are also better at handling rugged terrain than large vehicles are. They can make sharper turns, have better control on narrow lanes, can pass through narrower tunnels or overhangs, and can manage steeper inclines.

Indeed, the biggest beneficiaries of automation might be the smallest roads of all: mountain paths that can today only be used by very small vehicles or pack animals. Very small autonomous vehicles could revolutionize transport on such paths not only by eliminating the need to pay drivers’ wages and insurance, but also by gaining more space to carry cargo as a result of no longer needing space for the driver, the steering wheel, and spare tires. These vehicles could be used to facilitate shortcut routes that pass through rugged terrain, or to open up rugged terrain to increased economic activity.

The use of small autonomous vehicles in rugged terrain might also allow for the introduction of another new technology : roll-on, roll-off ropeways. These would be ropeways that small autonomous vehicles would drive on and off of, or clip on and off of, in order to be carried above natural barriers such as steep inclines, rivers, flash-flooded roads, or snowed-in high-altitude mountain paths.

They could be especially efficient at handling inclines, not only by allowing direct as-the-crow-flies routes to replace winding, hairpin roads, but also because ropeways operate as a pulley system wherein the weight of descending vehicles does much of the work — and often does all of the work — of lifting the weight of the ascending vehicles.

Here you can see a very primitive RoRo-Ropeway at work. Here, you can see a somewhat less primitive, though still limited, version built in a Volkswagon factory in Slovakia. If automation leads to a proliferation of small autonomous cars, working ant-like to transport goods in rugged terrain, then perhaps we will see systems like these increase and improve. Economically, it may be as close as we get to flying cars anytime soon.

 

 

 

 

 

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North America, South America

Superhighway in a Box

Roads and railways are great, but they are not portable, scalable, or particularly well suited to ideally handling rugged terrain. You cannot easily disassemble a road or railway in order to move it from location to another. You cannot easily drive trucks or trains up and down steep hills, or across icy or snowy or flooded-out landscapes. And, you cannot widen a road or railway very much without facing sharp increases in expense. The wider you build them, the more likely they are to find a natural or man-made barrier in their way. The widest stretches of highway in the world rarely exceed 150 metres.

Ropeways, in contrast to roads or railways, are portable, are scalable, and are ideally capable of handling rugged terrain. You can fairly easily disassemble and transport them. You can scale them horizontally or vertically. Ropeway corridors could be made extremely wide without being blocked by natural barriers. So long as they are portable and temporary, wide ropeway corridors might also be able to avoid unduly bothering the owners of the private farmland they would inevitably need to cross above at times.

Their potential combination of portability and scale could make ropeway corridors useful for transporting bulk, time-dependent goods: for transporting crops at harvest time, or transporting cargo during the rainy season when roads are flooded out, or  in snowy areas during the winter, or to help construct and access mines or dams.

There are a number of factors that could make ropeway corridors become common in the future:

  • cheaper intermodal transportation as a result of autonomous cargo transferring. Thus far, the costs associated with transferring cargo from one mode of transport to another have led trucks to account for an estimated 70% of all US cargo transport, despite trucks being generally much less efficient than railways or waterways. If  loading, unloading, and handling cargo becomes automated, we might expect that railways, waterways, and perhaps even ropeways will become used more widely as a result
  • automating cargo-handling also means that ropeways would be able to add many more entrance and exit points than they have had in the past. Loading cargo on and off ropeways is especially labour-intensive, because the cargo arrives and departs at a slow trickle, each vehicle on the ropeway carrying much less than a truck or train. This has meant that ropeways have tended to move goods only from point A to point B, without many or any intermediate stations. Autonomous cargo-handling could change this, dramatically increasing the usefulness of the ropeway system
  • cargo tracking systems — ropeways are slow, which in the past created uncertainties for those waiting for the goods they are bringing. With today’s cheap GPS tracking systems and software that can estimate arrival times (and adjust those estimations when there are unexpected delays of one sort or another), these uncertainties are reduced
  • partially-autonomous maintenance: some of the technologies now being deployed or developed for maintaining vast electric grid systems should be applicable for ropeways as well. These include, for example, sensors and computer systems that monitor the entire length of the system in real-time, and drones that can be used as cameras to make inspections
  • in some cases passenger cable cars might be able to share the same ropeway as cargo systems – perhaps with passengers being transported during the daytime and cargo transported overnight. Ropeways might also benefit, therefore, from technologies that facilitate intermodal passenger transportation: for example car-sharing, ride-sharing,autonomous valet parking, and other technologies might make it easy for a passenger to drive to a cable-car’s entrance and then get in a different car at the cable-car’s exit.

 

 

 

 

 

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Uncategorized

Humans, Computers, and Telecommuters

Let’s discuss two sets of three: the land-labour-capital trinity of conventional economics, and the human-computer-telecommuter set that may soon become the three main categories of labour.

To state the obvious, the key relationship during the past generation has been the “capital” of North Atlantic economies (whether that capital be military power, technological innovation, or consumer demand), chiefly that of the United States, and the labour and “land” (most notably, the fossil fuels in that land) of Asia, chiefly that of the Chinese.

Even in recent years, this relationship between North Atlantic capital and Asian land and labour has arguably continued to intensify. Specifically, if we characterize “land” as being the type of energy production that has the greatest impact on local environments — if, for example, we define it as coal production, coal consumption, and the building of massive hydroelectric dams — then we can see that in recent years the employment of Asian “land” has continued to grow at a rapid pace relative to that of the North Atlantic economies.

This has been the result of a number of different significant trends: the growing “green economy” of Europe, the coal-to-gas electricity switchover in the United States that has been the result of shale gas production, the growth of coal and gas consumption in Japan as a result of Fukushima, the growth of hydroelectric power in China (though China’s coal industry growth has been flattening), and the growth of coal industries in southern Asia.

We know that poorer Asian populations in countries like China and India hold the weaker positions in this trade relationship. They supply the labour and “land” chiefly because the wealthier economies of the world mostly do not want to allow large-scale immigration or domestic environmental despoliation, yet are not able or charitable enough to furnish poor countries with capital wealth without demanding labour and natural resource wealth in return.

We also know that this global trade relationship might soon decrease to some extent, whether because of automation or protectionism in capital-rich countries, aging labour forces in Northeast Asia, or an attempt to reduce pollution in China.

The view of world trade decreasing because of automation and protectionism has become especially popular during the past year, because of political developments in both the US and China. Upon closer investigation, however, a reduction in trade may not actually be likely. The hitch here is the limitation of automation in wealthy economies. While computers and computer-run machines may now be excellent at doing tasks that humans are bad at — like being a grandmaster at chess or driving a truck for days without taking a pit stop — they are still terrible at a task that even human children find easy: manipulating objects.

The result of the limitation of automation may be the second set of three mentioned above: a human-computer-telecommuter division and cooperation of labour. Imagine, for example, an industrial or commercial site in the US that employs not only human labour, and not only machine labour, but instead a combination of a small number of on-site labourers, a large number of autonomous machines, and a large number of machines controlled by lower-wage labourers working remotely from poor locations in foreign countries.

In one sense, every party involved would gain in this relationship: rich countries would gain access to cheap labour without needing to outsource, poor countries would receive wages, and both would be allowed to harness the productive power of machines without having to wait until robotic technology is good enough to allow machines to replace labour altogether. Or without having to deal with the economic and social consequences of that day finally coming.

On the other hand, “telecommuters” might further income inequality within wealthy countries, by forcing labourers in those countries into even closer competition with labourers in poor countries. Moreover, it might make it more difficult to ignore the unfairness that exists as a result of real wages in rich countries far exceeding those of poor ones.

The effect of telecommuting — which includes, but is not limited to, a worker being able to control a machine that is located thousands of kilometres away — may be to make labour much more easily tradable across long distances. Since “capital” is easily tradable too, this may leave “land” as the odd man out. Land considerations, for example the location of cheap and/or clean electricity, or of ports capable of importing natural resources from abroad, may therefore become more important, at least relative to labour considerations, when choosing where to locate a new industrial or commercial site.

A place like Iceland, for example, which has abundant and clean power, difficulty in exporting that power directly because of its island location, ports proximate to North America and Europe, and yet no real labour force to speak of, could use a combination of autonomous and remotely-controlled machines to become a major industrial or commercial production site. A similar thing may be true of economies like Quebec, Norway, Manitoba, or British Columbia.

Remote-controlled machines do not get very much press — even if you Google it, you will probably not find much, with the exception of medical tele-surgeries — when compared to discussions of a far future in which widespread, wholly autonomous machines run the labour force. What is so scary, or exciting, about the possibility of remote-controlled machines, and of telecommuting labour forces in general, is that we may not have to wait until the far future for them to become widespread.

 

 

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North America

North Side, South Side: Real Estate in the Greater Golden Horseshoe 

Toronto-Hamilton-Buffalo Populations

The horseshoe-shaped region that includes Toronto and Buffalo is one of North America’s most populous, with more than 10 million inhabitants.The Horseshoe’s northern half extends roughly 100 km from Oshawa in the east to Burlington in the west, and 50 km from downtown Toronto north to Newmarket. The Horseshoe’s southern half is also close to 100 km in length, from Hamilton in the west to Lockport in the east. It is 50 km from the St Catharines-Niagara area south to Buffalo.

Greater Golden Horseshoe .png

Golden Horseshoe in North America.png

In order for us to analyze real estate in this region, we first need to discuss three basic differences between the Horsehoe’s northern and southern halves: political, geographical, and historical differences.

Political 

The political distinction is the most obvious of these. Whereas the northern half is entirely within Canada, the southern half is split between a Canadian side and an American side. The Canadian side of the southern half is home to roughly 1 million people, of whom 550,000 live in Hamilton. The American side is home to 1.2 million people, most of whom live in the suburbs of Buffalo. The international border runs directly through the Niagara-Buffalo urban area, making it by far the most populous urban area shared by the two countries with the exception of Detroit-Windsor:

US-Canada border cities.png

US-Canada Border Cities

 

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Geographical

There is also a geographic difference between the Horseshoe’s northern and southern halves. Namely, it is that the Horseshoe’s southern cities are characterized by their relationship to water and to wind:

  1. Hamilton’s significance comes historically from the city’s harbour, which is by far the largest in the western half of Lake Ontario. The harbour facilitated shipments of bulk goods, helping Hamilton to become Canada’s Steeltown. It continues to host Canada’s largest Great Lakes port.

    Hamilton port

    Hamilton.png

  2.  The St Catharines-Niagara urban region, which is the 12th most populous in Canada, derives its significance from two water features. One is Niagara Falls, which draws both tourists and hydropower. The other is the Welland Canal, which connects Lake Ontario to the other Great Lakes via a series of locks, bypassing the Falls. Niagara Falls was the site of the world’s first major hydroelectric station, built in 1895. It continues to generate more power than any single dam in the United States. The Welland Canal was first built in the 1820’s, and is a key link in the St Lawrence Seaway shipping route that was opened in the mid-twentieth century.

    Welland Canal

  3. Upstate New York was shaped by a canal too: the Erie Canal. The canal is the main reason why Buffalo, Rochester, and Syracuse were able to grow as cities despite the heavy snowfall they receive (they are, by some estimates,  the three snowiest major cities in the world, outside of cities in Quebec, Newfoundland, or Japan). In the present day the canal is used primarily (but not entirely) by pleasure-craft. However during its heydey in the nineteenth century it was one of the most economically significant waterways in North America.

erie canals.png

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Average Snowfall; Source: Current Results

Snow in upstate New York comes mainly from winter winds blowing atop the relatively warm water of the Great Lakes. Because of these wind patterns, Buffalo actually receives twice as much snow per year on average than does Toronto. Indeed Buffalo gets more snow than any of Canada’s 18 most populous cities (a lot more snow, in most cases), with the exception of Quebec City.

Buffalo and Rochester are located in the middle of a “snowbelt”, which extends from Cleveland’s eastern suburbs all the way to the Adirondack Mountains east of Lake Ontario. The only other snowbelt cities with more than 100,000 inhabitants are Sudbury, Barrie, Syracuse, and Grand Rapids.

Great_Lakes_Snowbelt_EPA_fr

While Hamilton lies outside of any snowbelts (it gets the same amount of snow as Toronto, on average), it too is impacted by wind, being hit by among the most windstorms of any Canadian city:

windiest cities

Historical 

Today, the Greater Toronto Area has an estimated 6.4 million inhabitants. The southern side of the Horseshoe (Hamilton + the Niagara Region + the Greater Buffalo Area) has just half that, 3.2 million.

A little over a century ago these positions were reversed. Back in the late nineteenth century Buffalo’s population was more than twice as large as Toronto’s. In 1900 Buffalo was the eighth largest city in the US, and the fourth largest without an ocean port. Even Hamilton was not much smaller than Toronto in those days:

Toronto-Hamilton-Buffalo Populations.png

Relative population sizes; Toronto = 100

There are a number of reasons for this historic reversal, but they all have to do with the price of energy:

  1. Oil
  2. Automobiles
  3. Air Conditioning

oil prices historical.png

Cheap oil in the twentieth and late nineteenth centuries, and the technological advances of automobiles and air conditioning that cheap energy helped to make feasible, resulted in the decline of Buffalo and Hamilton relative to Toronto.

-Home air conditioning began to become widespread in the middle of the twentieth century. Not surprisingly, it led many Americans to move from cities like Buffalo to the Sunbelt. An estimated 28 percent of Americans lived in the Sunbelt in 1950; 40 percent did in 2000.

-For Sunbelt cities in the arid American Southwest, cheap energy was also necessary to ensure freshwater supplies, given the energy-water nexus. And for cities in the western half of the United States in general, cheap energy was needed to facilitate long-distance intercity transportation.

-Cheap oil also allowed land transportation — trains and automobiles — to supplant water transportation. Water transportation is far more energy-efficient than any other type of transportation, but it is also slow and inconvenient. With land transportation becoming dominant during the twentieth century, the importance of cities which were based around water transportation declined. Buffalo and Hamilton were two such cities.

-Buffalo and Hamilton were also not ideally suited to land transportation. For the Niagara peninsula, Lake Ontario and Lake Erie serve as transportation barriers for cars, trucks, and trains; so too does the Niagara Escarpment, which divides the peninsula (and Hamilton) into upper and lower segments. For Buffalo, lake-effect snow also frequently serves as a severe transportation barrier.

Toronto, in contrast, has been able to use automobiles and low energy prices to expand  approximately 50 km deep into its GTA suburbs to the east, west, and north. Because it is a Canadian city, Toronto has also not had to worry as much about people moving south to the Sunbelt, as Buffalo has.

 

Speculating About The Future

Since we do not know what future energy prices will be, prudence suggests that we should prepare for the worst: high prices. Indeed, it seems far from implausible that high prices will become a reality, whether because of carbon pricing or because of a diminishing supply of “conventional” oil. Even in spite of the current shale oil boom in the US, few people have predicted a repeat of the low prices of the 1990s or the 1880-1970 era.

If energy prices do become high, the Golden Horseshoe may look more like it did in the late nineteenth century. Just like how cheap energy allowed the Greater Toronto Area to grow relative to Buffalo and Hamilton, so might expensive energy allow Buffalo and Hamilton to grow relative to the GTA. Similarly, what growth the GTA does experience in an energy-expensive world would be likelier to occur mainly within the City of Toronto, rather than in the GTA’s sprawling suburbs as has occured in recent decades.

At the same time, we can also expect technology to have an effect on the region. In the last century new technologies like automobiles and air conditioners had the largest impact. But how will today’s new technologies – digital technologies – impact the Golden Horseshoe?

One impact of digital technology is likely to be that computers and machines will allow more work to be outsourced or automated. As such, people’s leisure time will increase faster than will their disposable income. From a transportation perspective, this will probably benefit water transportation, which is the cheapest but also the slowest form of transportation. Only someone with a limited budget and a lot of free time would find travelling by water useful; especially if they are trying to avoid carbon emissions.

In particular, water-based shortcuts could become popular. It is just 47 km from St Catharines to downtown Toronto by water, but 113 km by road. Given that ferries are already more energy-efficient than automobiles or even trains on a km-by-km basis, having such a significant shortcut could be highly useful. Buffalo is in a somewhat similar position: it is 93 km from Buffalo to downtown Toronto as the crow flies, but 161 km by road.

Greater Golden Horseshoe

Technology could also make intermodal transportation more convenient. For example, one lesson of the failed Toronto-Rochester ferry was the importance of the “first-mile/last-mile” challenge. Because downtown Rochester is over a dozen kilometres inland from its ferry port, and because downtown Toronto did not have good transit ties to its own ferry port in the Portlands, the ferry was not very useful. The ferry had to reserve most of its space for cars rather than for passengers, so that passengers could drive to and from its ports. The cars also accounted for most of the weight on the ferry, reducing the ferry’s energy efficiency.

With new technologies, however, such as car-sharing services or even self-driving cars, the challenge of getting to and from the ferry port could be eliminated. The ferry would no longer need to be a car-ferry.

More leisure time could also help cities like St Catharines, Welland, Niagara Falls, and Buffalo. It is difficult for cars to cross the Welland Canal because, given the large ships that use the canal on a frequent basis, the only bridges allowed over the canal are lift-bridges. Traffic backups frequently ensue when the lift-bridges are raised. This is why urban development in St Catharines, Welland, and Port Colborne has been mostly limited to only the western side of the canal.
Welland Canal

If people have more free time, however, they may not mind waiting as long — particularly if their car is driving autonomously while they are waiting. A similar thing is true for waiting in a long line of vehicles to cross the US-Canada border.

Autonomous vehicles could be useful in other ways as well.  In areas where human drivers face difficulty or delay, such robots could be highly useful. For example in upstate New York’s snowbelt, cars and trucks with high-tech safety features could be a game-changer for transportation during the winter.

So too could autonomous snowplows. Snowplow drivers are expensive to employ, given that it takes a long time to plow snow and given that they are often hired to work in the wee hours of the night. Autonomous snow cleaners could also help a lot in hard-to-reach places where snow can be very damaging: on rooftops.

Autonomous trucks could also help Buffalo and the Niagara Region by making it cheaper to cross the US-Canada border, where currently it is often expensive to pay truck drivers to wait in long, slow border lines.

Autonomous cargo ships could benefit this region too. They could allow for smaller vessels to be used on the Great Lakes at times when they would otherwise not be employed, such as at night during the winter. They could help save on labour costs for ships traversing the Welland Canal, which because of its locks takes around 10 hours to cross despite being just 43 km in length. They could also save on labour costs on the Erie Canal, which takes over a week from Buffalo to New York City and cannot be used by very large ships.

Finally, cargo shipping on the Great Lakes and their canal systems could be used more because of autonomous machines loading and unloading containers, thereby saving on labour costs and so perhaps allowing intermodal transportation to become competitive even for relatively short-distance water shipping.

Horseshoe

Conclusion

If a world of high energy prices and even higher technology does come into being, it might have three major effects on the Golden Horseshoe. First, it would be likely to cause the Horseshoe’s southern half to grow more quickly than its northern half. Second, it would be likely to cause the City of Toronto to grow more quickly than its surrounding suburbs. And third, it would be likely to cause Toronto to become more connected to the Niagara-Buffalo region, via Lake Ontario’s shortcuts.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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East Asia

Geopolitics within China

The year 2017 has short, medium, and long-term significance in China.

Its short-term significance comes from the Communist Party’s quinquennial leadership transition, which is being held a week from today.

Its medium-term significance comes from being the twentieth anniversary of the most recent notable geopolitical transition in China; namely, of Hong Kong leaving the British to join (in effect) China’s largest province Guangdong, and of Chongqing leaving China’s formerly-largest province Sichuan, in 1997*.

Its long-term significance comes from being the 100th anniversary of the Russian Revolution; of which, with the Soviet Union now long gone, the Chinese Communist Party is the only major remnant. The Party’s centennial is itself arriving in 2021, the first deadline in Xi Jinping’s “Chinese Dream”.

It is interesting to think on how these factors may overlap. The Russian Revolution of course brings to mind the Soviet collapse. That collapse occured 69 years after the Soviet Union’s formation; next year will be 69 years since the People’s Republic of China’s formation. These memories may be reenforcing the desire of China’s leadership to avoid the mistakes they perceive Gorbachev to have made. In a small way, this might be contributing to the Party’s granting more power to Xi Jinping. The promotions Xi makes this week are being watched closely, worldwide, as a yardstick of his clout.

Geopolitics within China 

The twentieth anniversary of the political changes to the Hong Kong-Guangdong and Sichuan-Chongqing regions are, arguably, deeply relevant to this issue.

First, the two men Xi is expected to highlight as long-term successors of himself and of Premier Li Keqiang currently lead those regions. Chen Min’er is the party chief of Chongqing, Hu Chunhua is the party chief of Guangdong. Both will have an incentive to keep their regions pliant, in order to realize this rise to the top.

Second, the strongest moves in Xi’s anti-corruption campaign have been taken against top leaders in the Sichuan-Chongqing region: against Sun Zhengcai, party chief of Chongqing, a few months ago, and against Zhou Yongkang, a former chief of Sichuan, in 2015. Sun will be the first Politburo member kicked out under Xi. He will be just the third incumbent Politburo member to fall in the past 20 years, and yet the second party chief of Chongqing (the other being Bo Xilai, in 2012) to do so.

Third, Guangdong and Sichuan are by far the largest of China’s “peripheral” provinces (see graph); provinces outside of the part of China that, roughly speaking, lies between or near Beijing and Shanghai. Few recent Chinese leaders have been born in peripheral provinces; the new Standing Committee that Xi is expected to pick will not have anyone born in a peripheral province. Neither was anyone on the current Standing Committee* born in a peripheral province. Indeed, nobody born in Guangdong or Sichuan holds any of the 43 positions within the Communist Party’s Politburo, Secretariat, or Central Military Commission.

China's Peripheral Provinces

Read the full article here: Geopolitics within China

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Uncategorized

Call for Submissions: “Robots & _______”

Hey all, I’ve never tried this before, but I’d like to try crowdsourcing the content on this site a bit. Specifically, I’m looking for peoples’ articles that have the title “Robots & ______”.

So far, we’ve got three articles on the topic:

Robots & NHL Expansion
Robots & the Middle East

Robots & Ontario’s Minimum Wage

Ideally, I’d like people to send in more of their own articles (any word count you want!), so I can put all of them together to create a series on how robots might impact various aspects of our world.

I look forward to reading your ideas — thanks y’all!

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North America

Upstairs, Downstairs

With the US being a 17 trillion dollar economy, it can sometimes be easy to forget that both of its neighbours, Canada and Mexico, are in the trillion dollar club as well. Canada is the 10th largest economy in the world by nominal GDP and 17th by purchasing power parity (PPP)-adjusted GDP; Mexico is the 15th in the world by nominal GDP and 11th when adjusted for purchasing power parity. Outside of the US or EU, Canada and Mexico are already the two largest economies in the world within the same trade bloc. With continued decent GDP growth—both are expected to grow 2-3 percent in 2017—they may soon overtake more EU economies in size too:

trade bloc pairing comparisons

And yet, as the NAFTA renegotitation begins its second round of formal talks this week, the trade bloc shared by Canada and Mexico may to some extent now be on the chopping block. Not surprisingly, the two countries are now attemtping, diplomaticaly, to stand shoulder to shoulder with one another; to present a unified front to the US. But this can be hard to do, especially when those shoulders are separated by a few thousand km of US territory. It may be,  then, that the US will divide and conquer them (economically speaking) and get the best deal for itself.

Read the full article: Upstairs, Downstairs

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