Comment by kragen | Hacker News Reader

Comment by kragen | Hacker News Reader

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The key fact here, buried in the middle of the article, is that the cost of shipping modules from Asia to Europe accounts for about 10% of their cost†. So, if protectionist measures are imposed, or if war breaks out and container ships start sinking, or if module costs keep falling, locally produced solar modules are the future; otherwise, they're not.

It's possible that the German factory that paid for this PR puff-piece will be able to bring their cost to within 10% of that of Chinese vendors, or even lower. If that happens, the result won't be a world of locally-produced solar modules; the result will be a world of German-produced solar modules, and there may be articles in the Chinese press lamenting how China is now importing PV modules from Germany.

Generally things are locally produced when shipping costs, tariffs, or risks would make overseas-produced versions economically uncompetitive. Potable water (0.03¢/kg) is usually locally produced at the 10km scale. Construction sand (3¢/kg) and aggregate (1¢/kg) and liquid oxygen and nitrogen are locally produced at the 100km scale. (The liquid gases are expensive to ship because they boil off during shipping.) Portland cement (10¢/kg), natural gas, and electrical energy are locally produced at the 1000km scale. Things that cost more than US$1/kg are, by and large, not locally produced.

PV modules cost about US$2/kg, so if shipping costs stay the same and war doesn't break out, we shouldn't expect to see them locally produced in non-protectionist countries until their price falls by another order of magnitude or so, maybe in 8–16 years.

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† I think the real number is closer to 5% than 10% (see https://news.ycombinator.com/item?id=26598814), but the article carefully avoided including any objectively verifiable numbers so we could find out whether I'm overlooking something.

I’m really starting to wonder about the collective value of skilled factory jobs and how that isn’t factored in to value calculations in typical USA business logic.

Like, with locally made solar panels you have some high paying jobs and those people will spend that money locally. With foreign made solar panels you have low paying warehouse and distribution jobs moving around foreign goods and most money goes overseas.

So yeah 10x cost is maybe still too much. But I suppose the actual figure depends on how value is calculated. I think it’s kinda wild the USA invested billions to build factories in China and now they can produce cheap goods and regular people in the USA can barely afford to live.

You're talking about what promotes the welfare of society, fundamentally a normative question hinging on our conception of "welfare", while I was talking about what the patterns of world trade are and will be in the future, and what causes affect them, a factual question. I did not intend to deprecate the importance of skilled factory jobs to the welfare of society. In fact, my comment didn't touch on normative questions at all.

I think that, in order to formulate a strategy to promote some set of objectives, as you are trying to do, you must first have a correct factual understanding of the causal relations of cause and effect that relate to those objectives. Whatever strategy you formulate will only have a tendency to promote your objectives, whatever they are, to the extent that your factual understanding of the causal structure of the system you are trying to affect is correct. Therefore, factual analysis of the relevant causal structure is epistemologically prior to any such normative analysis of strategies.

If your factual understanding is sufficiently incorrect, as in Tales of the Black Freighter, the strategy you formulate can easily have the opposite effect of what you intend. This is especially likely if your factual beliefs are being manipulated by other players whose objectives do not align with your own; this article seems to be an attempt at such manipulation.

I gotta be honest your comment is difficult to read. I know what all the words mean, but your sentence structure and word choice make it seem to me to be overly complicated. Idk if it's just because I am a non-academic. Anyway just wanted to give you my honest feedback.

I can't disagree. I probably should have put more effort into clarifying it, though that probably would have made it a lot longer. Still, I think you'll find it rewarding to work through it to understand what it's saying. You might try thinking of the examples of the phenomena it describes that I should have included—and counterexamples.

Sure. I mean I understand what you are saying.

1) That you weren't talking about normative issues. I get that. Normative issues have been on my mind lately and I wanted to add my thoughts.

The rest of your comment seems plainly true so I wasn't sure what to say really.

2) I must understand the facts properly in order to succeed. If I do not understand the facts, I or others will suffer unintended consequences. This is clearly true.

3) I must work to understand and counteract propaganda from others. I first began to question my beliefs after listening to Noam Chomsky. Clear critiques of the structures of power and how they affect the media and propaganda are key aspects of his philosophy, so I am aware of this.

> I probably should have put more effort into clarifying it, though that probably would have made it a lot longer.

Personally I think you could make it clearer by using fewer, simpler words. But I speak using simple clear words so of course I would think that. Anyway I don't mean to sound too critical, just sharing my thoughts.

As a counter feedback, I found your post an enjoyably clear read. Different cognitive styles perhaps.

I'm glad you enjoyed it!

In fact, your strategy can forward your goals with no causal connection to what you want to change, either by sheer luck, or because your rhetoric inspires people to do the Right Thing by some completely different means.

But I agree, of course, that these are not to be counted on.

I am happy to see a friendly competition to reduce CO2. It’d be cool to see people questioning in the papers about why they can’t be more environmentally friendly.

>I’m really starting to wonder about the collective value of skilled factory jobs and how that isn’t factored in to value calculations in typical USA business logic.

Because typical businesses are making decisions for themselves, and not their whole industry or economy?

Colluding with other businesses to try to achieve a collective goal might well even be illegal.

Right, but there's no natural law that says we need to structure business or our economy this way. We can form collectives that make decisions based on what the whole group thinks is best. We can federate collectives or make all manner of different arrangements. You have to understand, people are freezing to death after sleeping raw because they have no shelter. People are dying because they can't afford medical bills. It's worth asking ourselves if we're really doing the right thing.

>You have to understand, people are freezing to death after sleeping raw because they have no shelter.

I assume you understand the reasons there are people who live in an apartment on disability without working, but others are homeless. You may want to spell it out to make sure we are on the same page.

I'm wondering if you are drawing on specific personal experience and think you understand the crux of the problem. Could you state it if so.

>People are dying because they can't afford medical bills.

Which implies that EMTALA, Medicare, Medicaid, the ACA, etc. are insufficient, so do you have a specific gap and/or thing to fill the gap in mind?

>It's worth asking ourselves if we're really doing the right thing.

Saying that to a random person on the internet kind of implies you don't think most people ask themselves that all the time.

I'm inclined to assume virtually everyone does.

Either you have government action that forces all businesses to adhere to certain rules, or you get the rules that help each business to be as competitive as possible. If there is more profit to be made by shipping stuff from China and there are no global rules discouraging that, than any company which does not do it will eventually be outcompeted.

This is a false binary. There is a third way - collectively owned firms or institutions which represent a federation of collectively owned firms. That is the arrangement that I am most interested in and the one where the price is less important than the overall impact to society.

Take a look:

https://youtube.com/playlist?list=PLP0dfLFk-anf00e9_YBWy83SW...

I agree with you — and there must be a name for this kind of thinking. I was going to jokingly call you a "red" but, kidding aside, it's not even close to Communism. You're suggesting something more akin to forward-looking Capitalism.

Actually it's interesting. There have always been those who believed in voluntary communism and opposed capital "C" "Communism" where the state controls everything. These people have identified as "libertarian communists" or "anarchist communists" where "anarchist" does not mean "chaos" or anything of the sort, but describes a process of questioning and dismantling hierarchy, replacing it with collectively governed voluntary systems.

I recently had a conversation with someone about this who is a libertarian capitalist, and they found a few videos I shared intriguing, so I've just put them into a playlist to share with you. It starts with a 2 minute video that describes things in high level terms and then subsequent videos provide more detail. I think you might like it!

https://www.youtube.com/playlist?list=PLP0dfLFk-anf00e9_YBWy...

Now that I think about it. The whole capitalism vs communism debate is stupid. The flaws in capitalism are obvious and simple. Everything derives from it, even communism. Instead of fixing the leaking pipe everyone tries to build something akin to a teleportation system to catch all the leaking drops of water to send them back into the water tower so that they can leak out again and be caught by the system.

Kids, your money is broken. Money is the mirror image of debt and someone took that mirror image hostage. You still need the mirror image. The only thing you can do is shrug and create a new mirror image by creating new debt until the day the hostage is returned.

What if you don't want to create new debt? Rescue the hostage. That will never happen because people will deny reality for as long as possible. It actually takes someone who will force reality upon you, either the US government or the Fed. The former is prone to denying reality as well. The latter is unable to force reality onto people.

If denying reality is the fundamental problem then no ideology will ever fix it. Communism will suffer from other problems because it is just a different mechanism, it didn't change the humans that are part of it.

Denying reality is what allows it to continue, but the root of the problem is the structure of power in the world. The goal of libertarian communism is to decentralize power as much as is feasible and give people a say in their own lives.

So getting people to face reality is a key part of making the necessary changes. This is why all revolutionary ideologies include education as one of the first steps. So yes, if you cannot educate then you cannot make changes which require voluntary collective agreement. But I don't think it's impossible to educate. The real problem is that counter-revolutionary forces have a lot of money and power to "educate" in their own way, and manipulate us in to accepting unjust systems.

In its simplest form, anarchism is a process of questioning existing power structures. And some are legitimate and can be justified. But those that have no legitimate purpose must be dismantled. Libertarian communism is a method of organization that aims to build a foundation for an economy without massive power imbalances.

Really, I'd encourage you to look at the playlist I linked in my above comment, and let me know what you think.

Not sure if one needs to pay https://en.wikipedia.org/wiki/Deutsche_Welle for a 'puff piece' ;-)

Seems rather like reporting about what happens in https://en.wikipedia.org/wiki/Silicon_Saxony

Besides that we had some form of solar cell production here, only to outsource it to China decades ago. Much to the lamenting of the locals. Same for wind turbines. It's all embedded in the pork cycle/boom-bust scheme embedded in the maze of federal/state subsidies, policies and whatnot else.

Undoubtedly the factory was paying a PR firm, not the newspaper!

The thing you and other commenters seem to be missing: there are no environmental impact studies on panels produced in China. They're not letting anyone near their production sites. So called Chinese environmental studies are the actual PR pieces here. Meanwhile Chinese rivers tell the tale.

German manufacturing obeys far, far more stringent environmental parameters and is consequently more expensive. Its worth paying the premium if we want solar because of the climate.

What part of China do you live in where the production sites are somewhere other than in the middle of a major city?

One significant difference between environmental regulatory regimes in Germany and China is that in Germany there is no death penalty for polluters.

Regardless, my comment wasn't about what would be good or bad or what was worth paying or whether the environmental costs of Chinese PV manufacturing are 9% higher than those of Europe or 13% higher or 90% lower, and according to what measures (information you somehow seem to have forgotten to include in your comment too). It was about what economic circumstances must obtain for local production of PV modules to be economically competitive with modules shipped in from overseas, whether the modules are shipped from Germany, from China, or from Indonesia.

My message was not about providing you with my research, no. If you care about that, I invite you to do your own literature study.

It sounds like you're just making stuff up with total disregard for the truth.

Please stop. That is behavior unbecoming of the dignity of a human being.

Please stop yourself.

How does Germany manage to export $110.34B to China? Your arguments seem reasonable, but it seems that the ultimate conclusion is that Germany cannot export anything as China would do it cheaper. Does this situation also apply to other countries like the USA? Is not possible to compete with China anymore?

It is possible to compete with China on things that require special knowledge and are rarely needed. "Special knowledge" because China doesn't have the local skills to produce it (yet). "Rarely needed" because China didn't prioritize acquiring said knowledge. Case in point: Germany mostly exports production machinery (rarely needed, last forever, very special knowledge) and luxury automobiles (rarely needed, last quite some time, some special knowledge needed (mostly on how to appear "luxury")).

But in general, I firmly believe that western nations with high social, environmental, legal standards cannot compete with China, except in areas where China didn't yet have the chance to catch up for some reason. I think we are going back to a world where most nations know how to produce almost everything, so competition will no longer be on that knowledge but more on the other necessary factors to make production cheaper.

If you can't beat the price, you have to innovate constantly (=stay ahead) and sell higher quality to be competitive.

There are many things that Germany and the USA can do more cheaply than China, and those are the things they currently export to China. This can happen because of local skills and knowledge, for example, or because of natural resources such as brines and geothermal energy that are uneconomic to ship overseas for processing, or because of existing capital investments like those in the Richardson Grating Lab in Rochester, New York, or because of favorable regulatory environments like California's prohibition on contractual employer ownership of the work products of employees outside work hours.

There's the Ricardian comparative advantage argument: even if, say, China can produce N95 masks more efficiently than the US, the US might still be able to export N95 masks to China, if all the Chinese are so busy producing more profitable products like solar panels and microchips that they don't have time to also produce N95 masks, as manifested by Chinese wages rising too high for N95-mask factories to produce N95 masks at competitive prices.

However, this does not seem to be the case at present. If anything, the situation is reversed: there are things Germany imports from China, even though Germany could make them domestically from less inputs, because German wages are higher than Chinese wages.

The Germans save a lot and they refuse to increase public debt which means some other government has to take on that debt. Germany's ability to export its products is actually just its ability to export debts which is only a matter of how far you are willing to go vs your competitors. If everyone followed this strategy there would be no world economy.

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