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Alton Drew
Works at Alton Drew Consulting
Attended The Florida State University
Lives in Atlanta, Georgia
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Alton Drew

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Connecting #Florida   #Cuba   #PuertoRico  and the rest of the #Caribbean   with #energy  
The Puerto Rico Electric Power Authority owes banks nine billion dollars. A shrinking population and an economy still struggling to recover from the last recession isn't helping PREPA generate the revenues needed to pay its debt. Compounding PREPA's problems is an antiquated electricity generation and distribution system that still relies on oil as its primary source fuel for generation. Puerto Rico's residents pay, by some accounts, between $.22 per kwh to $.30 per kwh on an island where median household income hovers around $20,000 per year.

Maybe PREPA needs to start thinking outside the box and find another electricity source. One idea I'm excited about is bringing in electricity from Florida. In an article published on CaribbeanBusinessPr.com in April 2014, Manuel Casiano raises the idea of importing energy from Florida via undersea cable. According to Mr. Casiano 30 such facilities were already in place with 15 more projects being built. Mr. Casiano estimates that an undersea cable project would take approximately three years to complete. Mr. Casiano goes on to say that:

"This cable plan is part of a growing worldwide interconnection trend. Undersea power cables have proven both effective and reliable. They are earthquake proof, hurricane proof and terrorist proof, and can be laid with minimal environmental impact. And the costs of these undersea systems are competitively priced compared with large works of energy infrastructure and lend themselves to public-private partnerships. Nor is this anything new: We currently have six undersea communications cables connecting Puerto Rico and Florida."

The demand for undersea cable delivery of electricity appears to be growing according to an article on NationalGeographic.com. Concerns about climate change and volatility in energy prices have not only driven the demand for renewable energy but for undersea cable delivery of electricity as well. Global sales of high-voltage submarine power cables are expected to triple from the estimated $1.9 billion in 2014 to $5.3 billion in 2023.

Ironically recent changes in Cuba-U.S. relations may open the door a bit to connecting Florida generated electricity to jurisdictions in the Caribbean, including Cuba, Dominican Republic, Puerto Rico, and the U.S. Virgin Islands. As noted in a recent article on EnergyBiz.com, the short distance between Cuba and Florida makes it possible to lay several pairs of cable carrying 2.4 gigawatts of electricity from the Sunshine State to Cuba. Undersea cable could be used to connect Cuba to Hispaniola, Jamaica, and Puerto Rico carrying electricity generated by coal, natural gas, nuclear, solar, or wind through the rest of the Greater and Lesser Antilles.

And while the Caribbean has an abundance of sunshine, sea currents, and wind, it will take time to develop facilities necessary for harnessing the alternative sources of energy. During this time, lower cost electricity provided via undersea cable could help alleviate high electricity bills or the lack of access residents have to electricity. In addition, reducing energy costs via undersea cable could turn around economies such as that in Puerto Rico buy giving present businesses an incentive to stay while lower costs of energy provides an incentive for other businesses to make the move to the Caribbean.
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No. More telecom mergers won't adversely impact net neutrality

In an opinion piece written for Forbes.com by Professor Warren Grimes of Southwestern Law School argues that there is a link between mergers in the telecommunications industry and net neutrality regulation. Specifically, Professor Grimes argues that:

“Large telecom providers usually favor mergers and oppose government regulation. Meanwhile, content providers and consumer groups typically hold opposite views: they oppose the mergers and favor the regulation. Sound policy requires more nuance. The public interest and the long term interests of industry participants are best served by limiting mergers and, as a direct result, minimizing the need for government regulation. Competition, not government regulation, is the best way to ensure that consumers receive what they want at a fair price. But this result is possible only if mergers do not create powerful firms that suppress competition and undermine consumer sovereignty.”

The premise that an alleged lack of competition for broadband access or content provision has a negative impact on net neutrality is faulty because net neutrality has nothing to do with either. Net neutrality is about content providers’desire to pay zero for sending traffic across a broadband provider’s last-mile network. Just look at Commercial Network Services’ complaint against Time Warner Cable that it should be allowed to interconnect with the broadband provider for free. To CNS, Time Warner Cable is “degrading its ability to exercise free expression.” And here we thought the “attack on democracy” argument was being used to advocate for consumer rights to internet traffic, not for corporations.

Do consumers really want a diverse amount of content? No, they don’t. Out of an average of 129 available cable channels, consumers watch an average of 17, according to an article in Arstechnica.com. And of the 961,554 active websites today, consumers visit less than ten a day for their news, entertainment, shopping, and other information. The British communications industry regulator, Ofcom, determined in 2012 that the average number of domains visited per month by an internet user was 82 in January 2012.

Mergers may be an appropriate way for less viewed sites to gain not only viewership but capital, especially if they have a niche brand that an acquiring firm wants to leverage for growth in market share. Writing off mergers on the false pretense that they stifle a competitive offering of content is the wrong approach. Instead, regulators should view mergers as strategic partnerships that help get little viewed content some more traction.

If net neutrality really has anything to do with treating all traffic equally then regulators should be interested in ensuring that content providers have an organizational structure that can best help a content provider get eyeballs to its traffic. Just saying traffic should be treated equally does not make traffic worthy of equal treatment by the market.
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Of ‪#‎Gentrification‬, ‪#‎capital‬, and moral arguments

Culture by definition is not expected to be static and when its eradication is sped up when capital seeks to occupy a vacuum. Culture, the skills, arts, etc., of a given people at a given time are, in my opinion, contingent on a particular eco-system and eco-systems are subject to change. Some change slower than others but none are guaranteed to last indefinitely.

This reality is overlooked by "black" Americans who are taken aback by the changes in their neighborhoods driven by an influx of capital with the purpose of making their neighborhoods more affluent or upscale with the endgame of selling renovated property for a capital gain.

I am extra mindful of this today given that 50 yards from my window here in the West End of Atlanta, an annual street festival is taking place to showcase, I suppose, the upside of an otherwise stagnant neighborhood. You see more whites in the neighborhood during this event than any other time of the year. Were it not for the white flight of the 1950s and 1960s the West End, which was once its own town, would still be majority white.

But white flight like the capital held by whites ebbs and flows like a tide and the tide of investment is pounding the beachhead of this southwest Atlanta neighborhood.

With foreclosed properties and average household incomes around $23,000 to $25,000 a year, the West End is a target rich environment of distressed properties. Capital abhors a vacuum and as events like the street festival brings its annual scouts to the area, capital should attach itself to the profitable opportunities it finds.

The push back against gentrification usually poses arguments that mix morality and community economics. "If rents get too high, where will the people go?" "The neighborhood has been 'black' for decades and we'll lose our culture if this continues." "The white man likes our culture but doesn't like us so he's pushing us out."

The arguments are heartfelt, coming from a morality honed from the brutality of slavery, the violence and humiliation of Jim Crow, and the systemic discrimination so engrained in the economy that at times it is analyzed and accepted so dispassionately by those whose histories have nothing in common with blacks.

In the end, however, given the current decisionmaking process that accompanies capitalism, its impact on eco-systems, and no guarantee of a static culture, the arguments, no matter how morally driven, make no difference. Neighborhoods will change.

The question is, if one wants to maintain a neighborhood's culture; that certain feel, look, and rhythm, what changes in the mindset of its inhabitants are necessary?

First, property owners will have to address the differences in investment approaches in their own ranks. Some property owners welcome the potential change. They want new capital and the benefits that come with it: new consumer and job opportunities. Other property owners are willing to sacrifice increases in commercial activity in exchange for maintaining the community's "blackness" which usually means keeping blacks in the majority of the community's populace.

Yes, affinity brings comfort but that affinity could devolve into familiarity breeding contempt if opportunity and capital do not flow into a community. "We look alike but we poor together" just doesn't fly.

Community leadership should focus on aggragating investment capital from within the commmunity in order to spend that capital on one or two projects that provide labor with job opportunities while generating returns to investors. Opportunities and income should be recycled in the community first increasing the level of affluence in the community. Leakage of income, output, and opportunity should be minimized.

In addition, community leadership should be more aggressive in incubating business startups. Work needs to be done to encourage a diversification of businesses while mentoring startups around the pitfalls that all too often lead to their early exit.

In short it will take action. Moral arguments made to government officials provide no long term solutions. Continued investments and strategic partnerships hold the key to tweaking gentrification where affluence can be generated within a community for the people already there.....

..... but you have to want it.....
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This sums up our electoral system nicely ....
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Religious Freedom Restoration Act: Let the consumer gods take care of the consequences #Indiana #RFRA

The progressive branch of the political elite have been spinning the narrative that Indiana's brazen version of the Religious Freedom Restoration Act is a license for commercial interests to discriminate against certain social groups, most notably the gay community.  Mike Pence, the Republican governor of Indiana, wrote an opinion piece in The Wall Street Journal defending the Act, going as far as saying that the law does not give businesses a license to discriminate.  Mr. Pence is right that there is no explicit license to discriminate, but the Act does make it a little easier for a business to consider more explicit acts of discrimination.

Under the Indiana law, a claimant must demonstrate that a state action (an action by a government entity) or the action taken by an individual based on state action is a substantial burden on the claimant's ability to exercise his religion and that the action does not further a compelling state interest, an interest of the highest order:

"When a law threatens certain fundamental rights, the laws defenders assume the burden of proof to justify it. They have to convince the court that (1) the challenged law served not just an important public purpose, but a genuinely compelling one; (2) the law was well-tailored to achieve that purpose, and (3) the purpose could not be achieved by some less burdensome method."--Professor Bette Novit Evans

The law makes it clear that it will fend off government attacks on religion but it does not make it clear that it will force parties into a market relationship where one party, based on religious grounds, opposes initiating a transaction with another party.  Indiana wants to leave that choice open to individuals to enter market relationships and that is a good thing.

Discrimination has always been a part of religious practice.  Try attending a Methodist service and insisting that the clergy follow Islamic rituals or replace Genesis chapter 1 with a reading from Charles Darwin or Christopher Hitchens.  You would be asked to leave and not come back.  

The rules and philosophies of a religious practice automatically erect a wall between the followers and non-followers.  Part of religious exercise is to interpret teachings handed down over hundreds of years and applying highly subjective and emotional beliefs in a 21st century world that strives to equate the races and has grown more tolerant of differing views on sexual preference and other alternative lifestyles.  Unfortunately for the religious, while times may have changed, the interpretations of religious readings and teachings may not have kept up with changing views in society leaving the religious with no choice but to erect barriers in the name of religious self-preservation.

But does a changing society have a right to impose new rules of association on religious communities?  The answer is no.  Individuals and entities that make up the religious community have a right to associate with individuals and groups of their choosing whether those interactions are personal or commercial based.  You can't force the religious to have a "come to Jesus" moment and hold hands with the unannointed.  It won't happen.  

Nor can you protect the commercial component of the religious community from the consequences of their choice to discriminate, which will be loss of business.  For those of us who see the reality of the Act, that it will lead to certain businesses attempting to discriminate against particular consumers, we should relish the thought that in due time these businesses will be called out and find themselves on the receiving end of the discriminatory practices that they wished to engage in.  Consumers, who have a myriad of choices for goods and services, will have the final say.
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PG&E leads the U.S. as the largest #solar utility....http://finance.yahoo.com/news/pg-e-leads-u-largest-163300765.html
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Alton Drew

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Verizon acquisition could, ironically, be a good move to get from under the FCC's net neutrality rules.
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A good supplement for my son's social studies class....
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Why can't broadband competition proponents focus on the real picture?

The Center for Public Integrity released a post yesterday that has me questioning their economics integrity.  In the post, the Center describes how #broadband providers avoid competition by arguing that the "Internet service grew out of the old telephone and cable TV systems, where only two companies owned direct lines to U.S. households."  Sorry, but that's only half the story.  As I shared in my comments on the post:

"Advocates for competition in the broadband access platform market need look no further than the localities that ensure that only the provider with the deepest pockets are able to get entry into a market. Onerous financial, regulatory, and technical barriers keep ouyt smaller players. Richard Bennett makes a powerful point about legacy carriers having no incentives to go beyond service territories they negotiated for or acquired when initiating services.

In addition, there is too much emphasis on the "number of carriers" narrative. This is a capital intensive business and unless new players can muster up the cash, then you won't see a third wireline carrier entering a market.

Finally, when will "competition proponents" come out and give a definitive number for the amount of carriers in a market necessary for a declaration of competition. Two, three, or four carriers still reflects an imperfect competitive market."

Not only are Federal Communications Commission rules not promoting broadband deployment, but local government policies are adding to the hindrance.  No one complains about whether Interstate 4 connecting Tampa and Orlando should have a duplicate interstate running along it.  The concern is whether there is enough commerce running over the highway to spur economic growth and justify widening the existing lanes.

For example, according to comScore.com's report , 2015 U.S. Digital Future in Focus", in 2014, mobile app usage made up the majority of digital media activity.  Traditional television ratings fell as more Americans obtained content from emerging online platforms.    Seventy-five percent of all digital consumers over the age of 18 use desktop and mobile platforms to access Internet content.

Another sign of mobile's encroachment on the desktop is growth in smartphone use.  According to comScore, smartphone use increased 16% in 2014.

I just started watching "House of Cards" (Okay, I'm a late bloomer) so now I'm counted as one of 7 of 8 Americans watching video content online, with half of these consumers watching content online on a daily basis.

And about that commerce moving along the roadway?  E-commerce grew 14% in 2014 with businesses raking in $268.5 billion.

All this content and e-commerce activity happening while consumers allegedly are "abused" by a lack of broadband access platform competition.  Policy makers shouldn't waste their time on making an oligopoly a larger oligopoly.  The focus should be on clearing spectrum for greater use of the internet and ensuring that the provision of data, whether in the form of video or text, is not interfered with.
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It's about consumption security not income inequality

The Republican Party has taken the bait from the progressive narrative on income inequality and, according to a post in The New York Times, its potential candidates for the GOP nomination for president have rumblings apparently in line with the position taken by America's upper crust.  For example, the usual buzz terms, such as tax cuts and reduced regulations have been used by Senator Ted Cruz, Republican of Texas, and neither he, Jeb Bush, or his fellow senator Marco Rubio of Florida believe that government intervention is the best approach to resolving the problem.

This position appears out of line with a significant portion of Americans, even their fellow Republicans.  According to the Times, 69% of Americans believe that the U.S. government should take initiatives to close the gap while approximately half of Republicans feel this way as well.  

The wealthy don't share the rest of America's sentiments.  While a significant portion of the wealthy consider the ga to be a problem, only 13% of the wealthy, according to the Times, believe that government should be taking any action.  This sentiment holds even as the wealth gap is at its widest in years. According to a survey conducted by the Pew Research Center, median net worth for upper-income families is 6.6 times that of middle-income families and 70 times that of lower-income families.  

Although the Democrat Party has been sounding the charge for the barbarians to storm the walls of the wealthy, the Party's all but crowned nominee, Hillary Clinton, has not exactly been a chalkboard of specifics and statistics on the issue.  Mrs. Clinton has been vague when it comes to policy proposals, probably because she may not want to alienate potential donors with whom she now shares more in common with than we ordinary folks.

One problem I see is how both Republicans and Democrats conflate the issues of "wealth gap" and "income inequality."  They are not the same.  In theory an individual can make $36,000 a year and have a $200,000 in assets while a person making $80,000 a year may have negative wealth.  Should government risk putting together a policy package that provides. say, tax cuts, expanded earned income credits,  Medicaid, and an increased minimum wage that flows in part to a consumer that has moderate or even low-income from wages but has assets that can generate additional passive income?  To me such a policy would only aggravate the problem, assuming a problem even exist.

Yes, wealth has been moving more to those with capital versus those without but in a capitalist, market economy that is the norm, not a shocker.  I also don't think that low and moderate income Americans are losing too much sleep over what Mitt Romney or Warren Buffet rake in from their investment income.  What Americans are concerned about is consumption security; the ability to buy food, clothing, transportation, and electricity so that they have a safe and stable life for their families.  If there is to be any effective public policy in the poverty space, this realistic focus should be the starting point and selling point.  I'll get to why I say selling point in a minute.

First, let me propose this.  To abate consumption security while providing a platform upon which the poor can begin building wealth, the U.S. should abandon its social welfare program and replace it with an annual consumption voucher for the working poor.  Along with a Medicaid/Medicare program financed in part by the working poor via premiums, the working poor will be able to supplement the income they receive from their current jobs, using this supplement to not only consume but to build wealth.  

Such a program should meet the needs of the political elite to reduce budgets while providing the commercial elite with additional revenues and wealth derived from additional consumption of goods and services.   

Just how much would a voucher program cost?  According to the U.S. Bureau of Labor Statistics, there are approximately 5.6 million working poor families in the United States.  At $30,000 per working poor family, the total bill for this voucher program would be approximately $165 billion a year.  This is considerably less than the $370 billion a year spent on safety net programs such as food stamps, refundable portions of the earned income tax credit, in-kind assistance transfers, and other direct cash payment programs.

We may ask aren't we doing this now, but under a voucher program, we directly address a market problem.  Consumers living in poverty who are willing but not able to make purchases to address the most basic of needs would get a direct cash infusion and make their own consumption choices.  They wouldn't need the hand holding of numerous government agencies and why should they.  The working poor are already demonstrating responsibility by getting to a job that contributes toward taking care of their families.  Rather than bringing additional and onerous rules to bear on the working poor, streamlining the requirements for aid by offering a once a year cash payment reduces the stigma on the poor while making the state administratively efficient.

The selling point here is that given the reduction in administrative costs, taxes need not increase.  That should soothe the fears of the wealthy.  In addition, communities within which $30,000 of direct spending is made available should enjoy the multiplier or ripple effect such spending creates.  

This is not a new idea, providing the poor with vouchers, but what would be new would be for the GOP to aggressively push this alternative to the current welfare state and educate the voting public on its benefits.       #economy  
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Education
  • The Florida State University
    Law
  • The Florida State University
    Public Administration
  • The Florida State University
    Economics and Political Science
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Birthday
October 14
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Introduction
Alton Drew is managing director of Alton Drew Consulting, a public policy analysis firm headquartered in Atlanta, Georgia. He earned his B.S.Ec; MPA; and JD from The Florida State University in Tallahassee, Florida.   
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I'm good at what I do because I love it ...
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Political Economist and Attorney
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writing, legal analysis, policy analysis
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  • Alton Drew Consulting
    Managing Director, 2013 - present
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St. Thomas, USVI - St. Kitts-Nevis - Tallahassee, Florida - Orlando, Florida
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