Is this good?

Is it good that the one area of your economy where investment isn't falling off is the highly speculative bullshit area? 

I think you can see the consequences of uncertainty come forward in the explosion in corporate stock buybacks; that’s a sign of retrenchment, where money that could be deployed or invested is instead pushed out to shareholders. No wonder markets are near all-time highs while ordinary workers feel miserable.

The only area where this investment retrenchment and uncertainty is not in evidence comes from the insane capital expenditures for AI computing power, which is propping up the economy almost by itself. That’s why municipal pushback to data centers will be one of the more fascinating developments of the next few years. And it’s why we should pay a lot of attention to whether AI is a viable business, whether its gains are accelerating or stagnating, and whether too much of this capacity deployment is on spec and fated to cause a crash. (AI is creating other economic problems, but we’ll touch on those later.)

Louisiana residents probably already know that their Public Service Commission is preparing to approve Entergy's plan to build three new gas fired power plants solely for the purpose of supplying Meta's massive new data center in Richland Parish.  The plants won't benefit Louisiana ratepayers at all. But it will inevitably result in their paying higher rates. 

Okay, well, maybe there are some benefits to developing cutting edge AI technology.  For example, today, Microsoft announced its AI program has created a spreadsheet that is actually bad at math. 

Microsoft notes that you can combine its new AI function with other Excel functions, including IF, SWITCH, LAMBDA, or WRAPROWS. The company adds that information sent through Excel’s COPILOT function is “never” used for AI training, as “the input remains confidential and is used solely to generate your requested output.” 

The COPILOT function comes with a couple of limitations, as it can’t access information outside your spreadsheet, and you can only use it to calculate 100 functions every 10 minutes. Microsoft also warns against using the AI function for numerical calculations or in “high-stakes scenarios” with legal, regulatory, and compliance implications, as COPILOT “can give incorrect responses.”

Nobody knows what the use for any of this is, but it sure is interesting. Anyway, it's where all the money in America is going now so hopefully there aren't any signs of that whole business spectacularly imploding anytime soon.  There aren't any signs of that, right?

On Tuesday, Meta announced internally that it is splitting its A.I. division — which is known as Meta Superintelligence Labs — into four groups, two people with knowledge of the situation said. One group will focus on A.I. research; one on a potentially powerful A.I. called “superintelligence”; another on products; and one on infrastructure such as data centers and other A.I. hardware, they said.

The reorganization is likely to be the final one for some time, the people said. The moves are aimed at better organizing Meta so it can get to its goal of superintelligence and develop A.I. products more quickly to compete with others, the people said.

Some A.I. executives are expected to leave, the people said. Meta is also looking at downsizing the A.I. division overall — which could include eliminating roles or moving employees to other parts of the company — because it has grown to thousands of people in recent years, the people said. Discussions remain fluid and no final decisions have been made on the downsizing, they said.

Best of luck with all that. 

What happens in the boardroom

The last time we saw Jeff Arnold he was finishing out his term in the legislature while hatching this harebrained scheme to create his own parish by Brexiting Algiers and the West Bank of Jefferson Parish.  Thankfully for a lot of people, Jeff's Wanklandia Parish failed in committee. It wasn't the best news for Arnold, though, since his other gig as a VP of "Governmental Affairs" at FNBC bank was quickly coming to an unhappy end as well.

But don't worry too much about Jeff. There's always someone who can use a good lobbyist with state level experience. One such someone is the Association of Louisiana Electric Cooperatives who scooped up Arnold in 2018.  What are electric cooperatives?  Well here is an Advocate article we noticed today that explains it in a few paragraphs. 

Rural co-ops were begun during the New Deal after shareholder-owned utilities refused to extend service into rural areas. The federal government in the 1930s established a way that the users of the electricity would own the utility.

Eleven rural cooperatives provide power to about a million customers in Louisiana at rates that reimburse expenses without including a profit. Investor-owned utilities, like Entergy Corp., make and sell electricity, charging their customers their expenses plus a profit.

That doesn't sound so bad. Co-ops aren't technically public utilities but they are meant to operate in the spirit of the collective interest. Plus they are overseen by the Public Service Commission in case they ever get out of line.  So, really, they shouldn't need a corporate lobbyist like Jeff Arnold around to defend them unless... oh... wait... 

After discovering that some of the mostly part-time co-op board members were making high salaries and taking lavish trips, the PSC with unusual unanimity for such a fractious board clamped down with an April 2019 order that dictated term limits for board members, determined what constituted a quorum for making decisions, and other restrictions.

So the PSC did have to step in and correct the co-op boards for abusing the trust placed in them by the public.  And that is why the co-ops pay Jeff Arnold the big bucks.  It is so he can advise them when they to court to get off the hook.

The co-ops never argued that the PSC has no right to regulate. But that regulation, under state law, involves only rates charged and services rendered, such as the cost of buying and transmitting electricity, as well as dictating where that power can be sold, Arnold said.

“What the regulators did with their order was reach into the board room and basically tell a private corporation how to govern itself,” Arnold said. “The boardroom is the property of the owners and they choose how many board members, and say what the terms of their jobs are.”

The co-ops are intended to provide an essential public service for its communal owners. They aren't intended to enrich any private entity or individual. But, what happens in the boardroom stays in the boardroom, I guess.  Anyway, the judge ruled in favor of the privateers.

That's great news for them and for Arnold because bigger things are on the horizon. Earlier this week, we learned that the state is considering ways the co-ops can get into the broadband business through the use of federal grant funds. Now that the court has ruled in favor of the grifting board members, it looks like some folks might want to start browsing Tripadvisor again.  Just make sure they stay in the boardroom when they do.

Angelle sets his sights on a second Hypoxic Heron Award

Having already attained the highest honor any industry-friendly environmental regulator in the Department of Natural Resources can aspire to, Angelle will seek to duplicate this success on the Public Service Commission.