Lawyers’ Role in the Global Quest for Clean Energy
I just finished up my report on China and Renewables, in which 200 survey respondents did what I thought was a masterful job in answering the question: Why Is China Investing So Heavily in Clean Energy? I’ll have the report available for download shortly – certainly within the next day or two.
But no sooner did I hit “save” for the final time and send the report off to the proofreader did I realize that there is another factor that affects the calculus that, as far as I can recall, not a single person mentioned: the Chinese culture is not dominated by lawyers.
When Steve Jobs was asked why he had the iPad manufactured in China, he didn’t point to labor rates. In fact, he said specifically that labor represented a very small difference in his overall cost and profit projections. To paraphrase his answer: “I want them NOW. While my Chinese partners were erecting the second floor of the facility, they were already building the iPad on the first floor. The legal process took a couple of weeks, not a few years.”
That’s sobering, isn’t it? Maybe part of the reason we’re so ridiculously uncompetitive in critically important global markets is that our business processes are mired down with legal regulations and paralyzed by litigation.
Another quick story: As it turns out, three-wheeled cars are every bit as stable as their four-wheeled counterparts, and have a range of advantages in terms of cost and performance. Recently, Volkswagen went through extensive design and test of such a vehicle, and was very close to launching the product – until their lawyers realized what was happening.
“You think you’re going to sell that in the United States?” they responded, quite astonished that anyone – let alone a team of smart people – could be so stupid. “Forget it. The engineering calculations have nothing to do it with it. The first time it rolls over, the American attorneys will be fighting each other to sue, and we’ll be in court for a decade.”
This phenomenon is utterly pervasive in our lives, and it’s getting worse. Of the five best friends I had when I was growing up, two became doctors. Both quit years ago, largely due to the strain brought about by medical malpractice claims and the outrageous expense of the insurance.
It’s a shame we’re so entirely powerless to do anything about this. It sure would be nice to be building tens of millions of iPads here in the US, or to be driving better, more efficient cars, or to have our best and brightest treating us when we’re sick or injured — but it’s just not in the cards.
In a democracy, nobody is allowed to be above the Law, even if the Law is very…low. Our horizon is doomed.
Somebody, even a dictator, should go above and see what’s there 🙂
Isn’t it ironic that the greatest democracy on Earth is envying a former-an-still communist country for being so economically efficient and successful?
You just discovered why!
Happy Eureka moment, Craig.
Craig, you could expand that argument to include the way that ‘The Law’ adds substantially to the costs of innovation and production – costs that we all pay.
Craig, you wrote: “It’s a shame we’re so entirely powerless to do anything about this.” Shame on you! Time and time again, Americans have shown the power of one person to change almost anything. I cannot imagine Steve Jobs writing such a sentence.
Why don’t you start blogging about this problem we have with lawyers and politicians (most of whom, I believe, were trained to be lawyers), the corrosive effects it has on our industries, and the terrible costs of all this litigation and the delays in making progress.
Many years ago, I heard a story about the difference between the U.S. and Japan: the U.S. has about twice the population of Japan, but 100 times as many lawyers. So this problem is not new, and it is not restricted to the Chinese.
The best business (common opinion) is effective in grey zone, especially in post-totalitarian and developing societies, where Law can be evade due to personal relations, group interests, bribes , aspiration to show local preferences and profit. How long it will be? Till an attempt to receive maximum gain by any price will be. These attempts leads to decay of society. Look to Russia. China is avoiding yet this decay due to single force -its communist party and its merciless laws that work against dissidents.
But in a moment, if investor does not satisfy ephemeral requirements, these laws will directed against him.
My Father In Law, a wonderful Gentleman Who Loved his Daughter and me His Son in law was a Lawyer. But first he graduated from medical school and graduated with Honours. but his Mother died of Cancer and he was so enraged he went to law school and became a great lawyer. His specialty was Medical Malpractice and he won every case. After 25 years he retired and in 15 more years Cancer took him too .. And still rhe Doctors won’t admit Cancer is basically spread by viruses. And the Doctors and Insurance companies keep raking in our monies and their Lawyers try to block our richeous requests for remuneration for their mistakes whom they bury or cremate.
anything is secret!
I am an engineer in a democtatic republic country. If I start any project, first I should start literature stady, than I should do many calculations and produce many drawings as well as many reports for legal/government foundations. It takes too much time, and too much money, that is the cost…
But a foreman or a technician in a rural area may produce the same equipment without concidering any law or doing any engineering efort, just copy the original using poor materials, etc… If customer pay for it, you can see those cheap products in that market…
Solution is efective human rights… not slavery and sirs (bosses) Mr. Craig
Excuse me but system cut me away.
The end is: in any case the mentioned investor should turn to lawyer. They are evil, but at times they are useful evil.
Perhaps the above comment should be; In the USA no one is above the law, but the rich. Their lawyers make that difference for them. I believe it is not the lawyers, however, that are the problem. They are responding to a demand. The US people, however, are taught to be “projectors”. We learn early on that blaming others for our mistakes is just fine if you can make a case for it, however shakey it may be to a practical mind. We are taught illusions and fantasies from infancy, and that it is necessary and good. The Chinese, Et. Al., are beginning this in some ways with their move to westernize their culture. Time will tell if they can filter this out for themselves. The embrace of illusions at all levels will corrupt a society’s values and it’s responsibilities. Illusions have one common identity. They are not real. A law of mind tells us that “If any part of your truth is not real, then none of it is.” You can deny this and refute it and cover it over with illusions and argument, but you cannot change it. Truth extends like itself, as does illusion.
I have found the Chinese people I deal with are cooperative and honorable. In dealing with others, one thing must remain sacred, or all of society disintegrates. That is and and shall be an agreement between two people. Lawyers find traction when agreements are not obeyed or understood. Also, the wealthy can change their mind after making an agreement and let their lawyers lie their case for them. As people find their identity in property or wealth instead of integrity, they loose them selves in the process. IOW, their true identity. Crime levels here display this struggle daily, and political distrust exemplifies it. It is the identity with persuing of riches, not riches itself, that is the root of all illusion. Those who ignore this truth are the current right wing’s lawful prey.
It should be noted that in addition to investing in solar and wind power, China is also investing in nuclear power.
Recently it was reported that China has developed a nuclear reactor that uses only about 2% as much uranium per kilowatt as our reactors use, thereby greatly reducing waste. In fact, it was so widely reported that it would be almost impossible to be unaware of it. China also has plans to develop nuclear reactors which use thorium instead of uranium.
The idea that China is committed to using only renewable energy is incorrect.
The Peoples Republic of China is also the world largest investor in Coal-fired generation. The PRC’s alternate energy investment is sporadic, ineffective and mostly just propaganda. (and on the wane)
This information might be horrifying to the ears of all those Sino-philes, but the leaders of the PRC have little or no interest in bettering the environment, investing in effective propaganda instead.
PRC, will, over the next six years complete 854 giant coal fired power stations, producing more than 28 x the total generation of North America. At this point, PRC will produce more than 60% of the world’s total fossil fuel fired energy generation.
What does it take for some people to wake-up to their Sino-Love affair and stop excusing the excesses of a ruthless, totalitarian regime?
You are wrong Craig about the stability of 3 wheel vehicles. They tip over very easily. That is why you cannot buy a new 3 wheel ATV in this country. I own a 1983 Kawasaki 3 wheel ATV, and can attest that they will tip over even at very low speeds on a hill.
Hi Craig, I just finished your book and got much out of it. Very practical and yet not afraid of the theory. And the commercial and financial aspects were also interesting. I’ve been interested in PV for over 40 years. My take is there are many square miles of roof in the US and it makes sense to use it for distributed energy generation (it SHOULD make distribution easier and better with the proper grid.) Of course the power industry wants control of all generation (a heretical remark I suppose!).
Re the book: I wondered, when you made an analogy on the last page(298) about between tobacco companies and oil companies, if you were aware of the close connection between the defenders of cigarettes and the merchants of climate change doubt? They were paid to spread doubt by the two industries, tabacco first and when that was a lost cause by the oil companies. The half dozen main character were the same people. The excellent book “Merchants of Doubt” by Naomi Oreskes and Erik M. Conway(2010) tells the facinating story.
Thanks for your interesting emails. Filson Glanz, Prof Emeritus of EE, Durham, NH
PS: To make this relate to the “Lawyers’ Role..” I offer the abuse we all are subjected to by lawyers who make things so complicated that NO ONE reads the conditions on any software they download. Clearly the lawyers do not read their own tomes! A Legal Revolution is due!
Maybe like our politicians many judges are the best money can buy since they are getting hundreds of thousands of dollars for campaigns…
Corporations are not really people. Maybe we need equal money and TV, radio for all candidates and judges and referendums and no outside interference to make a democracy that would function. Now we hear paid for propaganda mostly in the media….We need equal rights, wages environmental rules worldwide too.
It’s true that corporations are not really people. However, for centuries, they have been, under common law, treated as people. For that reason, it may take a constitutional amendment to get them treated as other than people. The whole situation could be far more complicated than many of us realize; such an amendment could affect thousands of laws and have undesirable unintended consequences. It’s an issue that should be very carefully examined, at least partly because treating corporations as people seems to give them rights and privileges which many of us feel that they should not have.
Craig, you absolutely correct that the role of Lawyers in the PRC is very restricted. Now, this is due to three reasons.
1) PRC legal system prohibits a ‘not guilty plea’ to many offences. In all Court Cases, before a decision is reached a report is sought by the Presiding Judge(s) from the Communist Party. Although this requirement of the PRC legal system is mandatory, the contents of the report are for the Judge(e) eyes only. (‘Revolutionary Guidance and Correct Thinking). This procedure applies to civil, matrimonial, and criminal cases.
2) There is very little redress for citizens, either corporate, or individual. In the PRC patent violations, human rights, corruption flourishes. No law, no lawyers, no rules! It’s quite easy to locate human rights lawyers, they are usually imprisoned with their unfortunate clients!
3) Until very recently, PRC had little exchange with Western contracts and commercial law. This area has started to increase as PRC JVC’s and trade increases. But these lawyers only exist to assist PRC corporations to enforce western laws on Western corporations.
So tell me Craig, which of the above circumstances do you find so praiseworthy?
Lawyers, are like insurance policies. If you obey the the law, and the law is fair and just, you seldom need a lawyer. But, everyone who ever lost a case through his own fault, always cries “it was the lawyers fault’!.
When two grown adults divorce acrimoniously, it’s the lawyers fault. Never-mind that the parties have behaved in a ridiculous fashion. “it’s the Lawyers fault!
Good commercial lawyers assist commerce to complete agreements that survive the original parties. Part of the problem in advanced legal systems is the belief that social and moral problems can be solved by legislation. This leads to a massive surfeit of ill-conceived legislation, often created by small, noisy interest groups. This phenomenon is hardly the fault of lawyers, rather the legislators and voters themselves.
Safety requirements are a good example. For years some extremist green-left EV fans, have been demanding the introduction of the Indian built EV, Reva. Better known in UK as the G-Wiz. Sold as a quadracycle, this dangerous little car, offers no protection to the driver in a 22 mph collision. The expectation of death or serious injury is nearly 4 times greater than a motorcycle collision!
Are you seriously arguing that allowing dangerous products on the market place, and abolishing legal redress, is a good thing?
Would you like the Wild West to return?
A properly designed 3 wheeler can be as stable as a vehicle with four wheels. The three wheel ATV’s were not well designed as 3 wheelers. Motorcycles are ridden in such a way as to lean them into turns, this puts the center of gravity always pushing toward the ground. If you lean to the outside of a turn you will quickly find yourself spitting gravel..and worse!
If you design the 3 wheeler with a low center of gravity then it will handle more like a car and tend to slide in a turn as opposed to turning over, if you design the 3 wheeler with the ability to lean into the turns as a motorcycle then the center of gravity will still be toward the ground as you lean into a turn.
For what it’s worth, I’m a strong advocate of government regulation, IP protection, and many other elements of our society that seem to require lawyers. I just wish there were a way in which they could function without bringing the world around them to a dead stop, while profiting in the extreme. Perhaps I’m dreaming.
Craig, essentially, lawyers are simply the instruments of their clients instructions. Lawyer’s are obliged to represent the instructions of their client to the best of their ability, no matter how lacking in merit their clients case may be. The lawyer is neither Judge nor jury. No client, no lawyer, no case!
Rather than complain about lawyers, you should complain about overly complicated and unnecessary legislation, creating complicated laws that only serve the narrow political ambitions or fears of the few.
Most litigation is created by laws which were in turn,created by knee jerk emotional reactions to isolated extreme instances.
Craig,
I generally enjoy your commentary; even when you’re not quite accurate. However, this is way off base. Of course the Chinese have less lawyers and legal challenges. They have no rights! They don’t need laws to protect people because people have no rights in their courts and in their system when something goes wrong. As for Steve Jobs’ comment: it is out of context,and unfortunately, his observation and commentary has more gravitas than it deserves. The “problem” is that we compete in a flat world economically, but not politically or within social structures. Neither you nor I could get away with manufacturing processes that are allowed elsewhere, but we have no leverage to even the playing field. So manufacturing flows to the cheapest labor and less regulation; but that cannot mean we need to revert to their labor standards and rates, and obviate our regulations to meet the lowest common denominator. If so, we need to abolish minimum labor rates and abolish child labor and virtually all safety and environmental standards. I agree, we have too many lawyers (and I am one of them) – but the better distinction is that we have too many BAD lawyers who don’t get it. The right path is somewhere in the middle. We need a truly flat world measured by all metrics, not just economics – and we’re getting there slowly. The Chinese are finally embracing IP rights and we’re slowly getting more competitive. But don’t mischaraterize the issues – get the facts straight.