Perception Is Reality  

I was going to call this post "nude japanese waitresses" in honour of the strangest Google search result to arrive here in quite some time, but I managed to overcome the urge, partly out of the desire not to freak out any readers who use RSS.

The Sydney Morning Herald had an encouraging front page article yesterday, reporting that most voters are willing to pay more for their energy in order to overcome the climate crisis - it seems the people (and even Rupert Murdoch) want to do the right thing even if the government doesn't.

Almost two-thirds of Australians are prepared to pay more tax and more for essentials if it helps to reduce greenhouse gas emissions, according to a Herald/ACNielsen poll.

The finding comes as the Prime Minister, John Howard, prepares for a crisis summit with premiers today on the Murray-Darling river system. They will discuss restricting environmental flows to save towns and irrigators, as well as withdrawing water licences. The Murray-Darling Basin Commission will brief the summit on the severe impact of the drought on towns and irrigators.

The poll found 63 per cent would accept higher taxes and paying more for goods and services if it eased global warming.

The poll was taken from Thursday to Saturday last week following days of heated parliamentary debate on climate change.

It found 91 per cent of voters regarded global warming as serious, and 62 per cent were unhappy with the Federal Government's response.

The water situation acoss the ranges is dire, and Adelaide is beginning to wonder where its water will come from.

URGENT measures to ensure Adelaide and several Victorian towns don't run out of drinking water will be tabled at today's summit on the drought-stricken Murray-Darling Basin.

As part of a $2 billion national water project, there are plans to create new water storages along the Murray in South Australia and build a desalination plant to produce 30 million litres a day.

The summit, called by John Howard, comes as the water shortage crisis in Australia shifts from the availability of water for farmers to providing enough drinking water for cities and towns.

The Victorian Government's proposal targets the centre of the state, with plans to boost drinking water supplies in the region of Ballarat and Bendigo with pipes linking the Campaspe and Goulburn rivers.

There are fears in federal cabinet that the failure of autumn rains next year will lead to an unprecedented drought and water shortages, with dams drying up in April-May.

In another bid to win over regional voters, the Government has agreed to extend drought relief to small businesses for the first time.

The decision, taken by cabinet yesterday, will pump much-needed emergency funds into regional towns. Small business owners, such as harvesters and farm contractors, will be able to apply for the relief, provided a majority of their income is derived from primary production.

The Prime Minister will today outline the drought package, which will build on the $910 million recently announced in further assistance to drought-stricken farmers.

The Murray-Darling Basin last month recorded its lowest ever October inflow of 77 gigalitres, compared to the average 1100 gigalitres.

The Rodent is steadily trying to spin things back to the status quo - none of that clean energy stuff - we have to keep burning coal "because there are no alternatives" and will eventually turn to 'clean green" nuclear. Johnny's nickname is not due to looks and stature (as commonly supposed for obvious reasons) but due to his dogged perserverance at gnawing away at an issue until he has broken it - he understands full well the meaning of the saying "perception is reality" and is only concerned with perceptions at the end of the day. Of course, there will be a price to pay for continually growing our carbon emissions (that the farmers ahve already started to pay) and hopefully there will be some "climate criminal" trials one day. Johnny also wants to help Indonesia go nuclear - why any Australian prime minister would ever think it is sane to help one of the only countries ever likely to pose a security threat to obtain nuclear weapons is truly beyond me...

SYDNEY'S coastline would need to be festooned with windmills if clean, renewable energy was to generate enough electricity to replace that produced by fossil fuels or nuclear power, the Prime Minister said yesterday.

John Howard was responding to a Herald/ACNielsen poll that found 91 per cent regarded climate change as a serious issue.

More than 60 per cent were unhappy with the Federal Government's response to the challenge and were willing to pay more in taxes and for services if it helped.

Mr Howard said he found the results "quite unsurprising" and natural given the recent publicity on climate change.

He said he was particularly taken by the poll's finding that, when canvassed with energy options on how to best tackle global warming, almost 50 per cent opted for solar power.

Mr Howard said he could understand why people preferred solar power, but it and wind power would never be mainstream generators of electricity.

"Solar is a nice, easy soft answer. There is a vague idea in the community that solar doesn't cost anything and it can solve the problem. It can't …

"Solar and all these other things can make a contribution at the margins, but unless you want to have a windmill every few hundred feet starting at South Head and going down to Malabar … you simply won't be able to generate enough power from something like wind in order to take the load of the power that is generated by the use of coal and gas and, in time, I believe, nuclear.

Of course, I'm sure voters would be even less anamoured of the idea of a nuclear power plant in Centennial park than they would be the prospect of wind trubines along the eastern suburbs beaches.


The Labor party seem little better, although Anthony Albanese is trying to keep them on the right path.

A SPLIT is emerging in the Labor Party over climate-change policy, with a raft of MPs fearing Kim Beazley is turning his back on the coal industry in an election push for the green vote. Despite strong public support for measures to combat greenhouse gas emissions, Labor MPs believe the Opposition - not the Government - will be vulnerable to claims it is selling out workers at the election. Labor frontbencher Joel Fitzgibbon last week issued a "call to arms" to his caucus colleagues not to abandon coal technology and adopt extreme climate-change policies.

Queensland backbencher Craig Emerson said Labor had been successful in setting the agenda on climate change. "But we need to be careful not to get into a position where we are vulnerable to a Coalition campaign that Labor will increase petrol and electricity prices," Dr Emerson said.

Most of the anger is directed towards Labor's environment spokesman, left-winger Anthony Albanese, who has spearheaded the Opposition's push on climate change. As Australia battles the drought and drastic water shortages, climate change has emerged as a central issue for next year's poll.

Labor has targeted the Prime Minister as a "fossil fool" who has failed to endorse the Kyoto Protocol and is paying only lip-service to renewable energy. But Opposition MPs are worried the Government will eventually portray Labor as selling out Australia's resources sector - and embracing policies that will lead to higher energy and petrol prices.

"There is a lot of concern about where the debate is heading, and how we stay where we want to be, and not walk away from our commitment to the resources sector," one Labor MP said. "Howard will do anything to get a vote and his commitment to greenhouse issues will not stop him from going where he thinks we are vulnerable."

Mr Albanese yesterday rejected the attacks from some of his Labor colleagues. "We have 92 per cent of Australia who think John Howard has not done enough on this issue," Mr Albanese said, referring to a recent Newspoll commissioned for green groups. "Australia understands John Howard is frozen in time while the globe warms around us."

While I haven't been following it closely, the Tesla Motors blog has all sorts of interesting stuff, including this look at the EROEI of solar power (which should help dispel any remaining misconceptions).

Question: Doesn’t it take more energy to produce a solar panel than that panel will ever produce in its serviceable life?

Elon: The idea that a photovoltaic (PV) solar panel cannot pay back its energy investment is flat out wrong by a huge margin, but I’ve heard it repeated by many otherwise intelligent people.

Martin: This reminds me of otherwise intelligent people who think of hydrogen as a fuel – who don’t realize that it takes lots more energy to create hydrogen gas and pressurize it than you could ever get out of it with a fuel cell (or any other way).

Elon: Right. The analysis for photovoltaics is straightforward and has been done by disparate researchers around the world, with the payback results in recent studies varying only by a year or two.

The most common type of solar panel uses single- or multi-crystalline silicon wafers, and is offered by a wide variety of manufacturers, from Sanyo in Japan to Renewable Energy Corporation in Norway to Sunpower in California. Creating the silicon crystal is by far the most energy intensive part of the process, followed by various and sundry manufacturing steps, such as cutting the silicon into wafers, turning the wafers into cells and assembling the cells into modules.

The cumulative energy used can be summed up and accounted for both theoretically (eg. paper by Alsema, Frankl & Kato ) and empirically (eg. paper by Knapp & Jester).

In a modern manufacturing plant, the energy needed to create a frameless PV module from semiconductor scrap material is estimated to be around 600 kWh/m2 for monocrystalline cells and 420 kWh/m2 for multicrystalline cells (source: www.nrel.gov). A big variable is how thin the silicon wafer can be sliced. For ultra-thin cells, like those from Sunpower, the energy to produce a module may be considerably lower.


Taking the monocrystalline example:
Solar incidence (US): 1825 kWh/m2/year
Module efficiency: 18% (Sunpower)
Energy lost in system: 20% (Due to inverter, wires, cell temperature, etc.)
Total energy produced:

263 kWh/m2/year
Energy to create module: 600 kWh/m2 (National Renewable Energy Lab.)
… to build aluminum frame: 80 kWh/m2 (from Alsema et al)
Total energy used:

680 kWh/m2


The above results in a payback period of roughly 2 and a half years. The NREL study similarly calculates the payback period for polycrystalline panels to be 3-5 years, and amorphous silicon panels to be 0.5-2 years. Given that most modules have a 25 year warranty and an expected useful life in excess of 30 years, this indicates about a ten to one advantage for energy generated versus consumed.

Not accounted for is the energy cost of installing the modules, which is quite nebulous and varies depending on the efficiency of the installer. However, also not accounted for is the potential to use reflectors to concentrate solar energy, which can improve the payback period by a factor of two or more, and the ongoing improvements in conversion efficiency and silicon usage efficiency. Additionally, the aluminum frame is completely recyclable, and this recoverable energy is not accounted for.


Question: How many solar panels do I need to power my Tesla Roadster?

Martin: The Tesla Roadster consumes about 200 watt-hours per mile. Suppose you drove 35 miles per day on average (12,775 miles per year). You would need to generate 2.6 MWh/year.

By Elon’s math, monocrystalline solar panels generate about 263 kWh/m2/year in the USA. So you would need about 9.7 square meters of solar panels (a square about 10 feet on a side) to completely offset the energy consumed by your Tesla Roadster.

Elon: Obviously, you can’t fit these on the roof of your car. But you can hire a company like Solar City to install them on your house – where the panels are mounted at the right angle, and are in the shade as little as possible.

Martin: And if you get a time-of-use meter from your power company, you sell solar energy to the power company during the day at a high rate, and buy energy back at night to charge your Tesla Roadster at a lower rate. This gives you about 2:1 leverage, meaning that you need an array only 5’ X 10’ to completely offset the *cost* of energy for your Roadster.

Peak oil.com has a pointer to an article on the subject of iraqi oil and a new oil rush in Kurdistan.

Oil companies say that though there are no producing oil fields in the Kurdish territory, initial exploration has shown geological structures similar to large oil fields in other parts of Iraq. The Kurdish government claims 25 billion barrels of proven reserves in the north, plus 20 billion barrels of potential reserves. A Norwegian company, DNO, began drilling last November and discovered its first well this spring. While there is much more oil in the south, the violence there prevents those reserves from being exploited now. The Kurds themselves marvel at the change in international reaction to their advances.

The Oil Drum has an excellent interview with Michael Klare covering his usual subject of energy geopolitics.

DC: You have written "Beware Empires In Decline", referring to the United States. Generally speaking, what do the historical precedents tell us about the geopolitical behavior of such empires, particularly as regards what you have termed "senseless, self-destructive acts"? Also, please touch on why you think America is indeed in decline.

MK: The establishment and maintenance of an empire is an immensely energy-demanding enterprise. It takes enormous energy and resources to conquer foreign nations, maintain overseas garrisons, suppress rebellions, administer colonies, pay the salaries of soldiers and imperial bureaucrats, key fleets at sea, and so on. Every empire that ever was has struggled with this dilemma, and every empire that ever was collapsed sooner or later when the expense of maintaining the empire exceeded the revenues obtained from possessing the empire. For the United States, I believe, Iraq represents that turning point: before the United States entered Iraq, it was the dominant world power and possessed the strength to exercise hegemony in almost every corner of the globe; but the Bush administration vastly miscalculated the costs of occupying Iraq (now estimated at $1-$2 trillion) and that misjudgment will so deplete the US Treasury that American will never be able to undertake such a costly imperial undertaking again -- not without bankrupting the country and reducing us all to beggars. This having been said, the reality of our altered circumstances may not penetrate the thinking of our top officials, who may falsely believe that we still enjoy our pre-Iraq preponderance of wealth and power, and so undertake Iraq-like adventures abroad that will cripple this nation forever.

DC: Nigerian production has been subject to large disruptions for some time now through the operations of MEND in the Niger Delta. Angola is increasingly an important oil exporter, especially to China. Overall, the Gulf of Guinea is now, and will remain for some years to come, a key regional production center for light sweet crude oil. Will the West intervene militarily in West Africa? Would this bring it into open conflict with Chinese interests there and elsewhere in Africa?

MK: Bear in mind that "military intervention" typically occurs along a spectrum, beginning with the transfer of arms, followed by the deployment of military instructors and advisers, then the use of special forces attached to local irregular forces (e.g., the Northern Alliance in Afghanistan), and only then, in the final stages, regular combat troops. It may be some time (if ever) before the USA reaches this final stage in Africa, but it has already commenced the early stages (arms transfers and instructors) and there have been reports of US special forces operating against extremist Islamic groups in the Sahara region, so I would say that the process of intervention in Africa is well under way. The Chinese are also engaged in indirect forms of intervention, most notably in Sudan, where they have assisted the northern government in its efforts to suppress the SPLA in the oil regions in the south. I do not believe that this will ever lead to a direct clash between US and Chinese forces, but I certainly anticipate other forms of friction between the USA and China in Africa. Indeed, this has already begun: for example, the US has sought to isolate the Sudanese government at the UN Security Council, while China has resisted such efforts.

DC: Finally, will you comment on the likelihood of fossil fuel resource wars in the future? Here, I have in mind actual military conflict. Perhaps you could also touch on some regions I haven't mentioned above such as the FSU countries in and around the Caspian Basin, the South China Sea, etc.

MK: I assume you're distinguishing here between civil wars over the allocation of resource rents, like those now under way in Iraq and Nigeria, and full-scale war between the major powers over access to oil-producing areas. Wars of the first kind are happening now, and I would expect more of them in the future. As for the second, I think we have to consider the problem of "unintended escalation." I do not think that any of the major powers will deliberately choose to provoke a war over oil, as when Japan invaded the Dutch East Indies in 1941 (and bombed Pearl Harbor as a preemptive move against likely American retaliation), but I do think that they may engage in provocative behavior that could lead to accidental escalation under conditions of panic, confusion, and over-reaction (as in the circumstances that triggered World War I). A possible flashpoint for such a scenario is the East China Sea, where both China and Japan have deployed military ships/planes in a disputed energy zone and employed them in a threatening manner, risking potential panic fire and escalation to actual war - a situation that could get out of hand quickly and lead to full-scale war. So yes, in this sense, I think war over oil and gas is entirely possible.

Grist has a post on a new report from Claude Mandil and the IEA, which says the world's energy future looks dim.

A report issued today by the International Energy Agency says global demand for power could surge 53 percent by 2030 unless governments push clean, efficient energy. "The energy future we are facing today, based on projections of current trends, is dirty, insecure, and expensive," says Claude Mandil, IEA's executive director. The agency also says China may out-emit the U.S., the world's current carbon dioxide emissions leader, by 2009 -- nearly a decade earlier than previously thought. China maintains that responsibility for cutting global emissions lies with developed countries. "You cannot tell people who are struggling to earn enough to eat that they need to reduce their emissions," said Lu Xuedu of the country's Office of Global Environmental Affairs. Which may be true, but there's also this: 60 million Chinese are now getting rich and fat, thanks to a growing love of Western-style fast food and cars. So pretty soon they'll have to come up with new, Western-style climate excuses.

Grist also note that Africa is already feeling effects of climate change and will be hit harder.

While some people question whether climate change is happening, many Africans are already beginning to feel its effects -- and, says a new U.N. report, the continent is at greater risk than previously thought. Some 480 million Africans could face water-security issues by 2025 and more than 70 million may be at risk from coastal flooding by 2080, the report warns. More prevalent droughts will bring down crop yields and may contribute to an upswing in violence -- a recent study found that one of the most reliable predictors of civil war is lack of rain. Rainfall in the sub-Saharan region has declined 25 percent in the last 30 years, and the number of food emergencies in Africa each year has tripled since the mid-1980s. Says policy analyst Francis Kornegay in Johannesburg, South Africa: "You have climate change and reduced rainfall and shrinking areas of arable land; and then you add population growth and you have the elements of an explosion." Call it the shot ignored 'round the world.

The latest podcast from RU Sirius that found its way out of my iPod and into my head was called (much to my surprise as I didn't even remember downloading it) "The Commies Are Coming!.

Hey you decadent bourgeois numbskulls… meet our Maoist friend, d’Andre Teeter! He’s here to talk about the Revolutionary Communist Party and the biography of their maximum leader, Bob Avakian.

Whenever I hear (or read) a phrase like "Revolutionary Communist Party" I tend to mentally giggle as scenes from "Life of Brian" run through my head (and I'm sure Beavis and Butthead would have fun with this guy's name too). I'm always amazed whenever I find such things exist any more - let alone ones that are trying to start a personality cult for their leader. To give the guy credit he did by and large sound reasonable, even as he went on and on about how great Bob Avakian is - whoever he is.

The RU Sirius gang of 4 probably isn't the best group of people to try and win over with earnestness though and they didn't sound entirely convinced by some of Mr Teeter's arguments. I've heard RU note (unhappily) a few times that whenever there is a political revolution the first thing the revolutionaries do is shoot all the anarchists - when he asked Mr Teeter if that would be their fate under a communist government in the US he got some vague assurances that they'd probably be OK - at which one of the other panelists was quick to note he for one welcomed his new communist overlords (getting in well ahead of time).

For some reason Rick Mayall kept popping into my mind during this bit, with his oft-repeated line in "The Young Ones" to anyone he didn't like "you'll be the first up against the wall when the revolution comes". On a semi-related note to anarchist wipeouts, Libertarians in the US have hopefully now learned the same lesson about the authoritarian right that anarchists learned about the authoritarian left (without having to suffer the same casualty count) - authoritarians always take away your liberties, no matter what side of the common / private property divide they live on.

On the subject of communists (and on a slightly less tongue in cheek note), Bart at Energy Bulletin had some notes on what the World Socialist Web Site is (which is something I've occasionally wondered about) along with some criticism of their attitude towards peak oil.

The wsws.org website is maintained by the International Committee of the Fourth International (that is, the Marxist followers of Leon Trotsky). The views here are an updated version of the long-time Marxist arguments against "neo-Malthusianism."

David Walsh's arguments against peak oil are a mirror image of those encountered in right-wing circles: a complex situation is seen in terms of traditional opponents, and the traditional nostrums are repeated ("The Market will provide", "A Worker's State is the only solution.").

Fortunately, independent thinkers on both the left and right are examining energy issues and have more enlightening things to say. Stan Goff is such a writer on the left (see next entry).

Heading back to d’Andre Teeter on the RU Sirius show, one of his more interesting comments was during a discussion about how many people Mao did or didn't kill (with a sideline on whether or not killing them was justified), where they started talking about what is true and how you can know one way or the other. His argument was that we've been fed a constant stream of propaganda about communism and communist countries, most of which was wrong. The gang of 4 weren't buying the "Mao is innocent" line (and he didn't help his cause by claiming, admittedly somewhat incoherently, that hundreds of millions of people died each year of hunger in China before Mao arrived).

The question of "how do you know what is true ?" is an interesting one, given our constantly evolving propaganda system. I was having an email debate (prompted by my recent dismissal of UrukNet as basically a propaganda site) with one reader about this recently over the explosions at Camp Falcon in Baghdad. The more extreme reports about his claim 400 US soldiers died and there were "nuclear" explosions at the site, while the official story is that no one (or maybe 3 people) died. My personal view is that a casualty toll this large would be extremely difficult to cover up, especially given how close the US midterm elections were (and the obvious political benefits to be had for the Democrats) and the "nuclear" stuff is just propaganda (even if DU ammunition likely did go up in the explosions) - but how can you know one way or the other if you can't trust the media (and in particular the people feeding them information ?

Somewhat to my surprise, the Drudge Report is saying much the same thing (and seems to be leaning towards the theory that there was a blackout on the news - so maybe I'm not being cynical enough for a change):

One side of the propaganda war is making it clear that they feel at least 300 U.S. soldiers were killed, the whole base destroyed, and depleted uranium shells were detonated. Some goes as far as to say there was one or more nuclear detonations. They also make it clear that Camp Falcon was attacked with rockets and mortars.

The other side of the propaganda war is saying that no one was killed or injured, the damage to buildings was minimal, and that after a couple of days everything was back to normal. They also say the camp was attacked with mortars only.

Both sides say explosions were heard from miles away around Baghdad throughout the night of October 10th, 2006.

What is eerie about all of this is that while more articles keep coming out about Camp Falcon citing Islamic sources, there have been no reports in U.S. news except the initial ABC article and a blurb on CNN. This is causing many to cry cover up.

The really frustrating thing about all of this is that it is nearly impossible to get any facts on this story. Reporters are not about to go to Baghdad to report on it. Ofcourse the U.S. military is not going to admit to anything beyond what they have already said. Of course the insurgents are going to play it up as a victory and use this incident for recruiting and fund raising.

If however, uranium got spread throughout Camp Falocn and Baghdad that will be impossible to cover up and will eventually come out as people start dying from radiation sickness.

Why the United States media is staying mum on this story is beyond me. It could be like the soldier said in "The Letter From Iraq" that most things just don't get reported. Attacks happen every single day. Ramadi is one of the most dangerous cities in Iraq but we don't hear about it.

Are we entitled to know the truth of what is happening in Iraq? I think we are. Would it destroy military morale? I don't think so. Most soldiers in Iraq are not fighting any more to free Iraq or protect America. They are fighting for each other. They are living their own Band of Brothers movie. The troops on the ground in Iraq KNOW the truth. Telling the public won't hurt them.

Telling the public The Truth however could quickly lead to louder calls for withdrawl from Iraq. The problem is the Bush Administration and the Pentagon have lied to us so much that they feel we could no longer handle the truth."

In some ways this reminds me of one of the ideas explored in a podcast by Cory Doctorow of his science fiction story "0wnz0red", which looked at the "brain in a box" problem faced by digital rights management systems software developers ("The Matrix" series of movies also considered this from a completely different angle of course - as did "The Truman Show"). In a nutshell, the problem to solve is how to be sure that you can trust the information you are receiving...

Tim Berners Lee (who sort of invented the internet, along with Al Gore of course) recently expressed reservations about how the internet may become a mechanism for disseminating misinformation (OK - he's way behind the times, as anyone who observes all the farther reaches of the internet, and White House press releases, will tell you). The article was a bit cryptic - I'm not sure if he was worried about the armies of angry bloggers repeating their various party lines, jihadi web sites, deliberate propaganda campaigns governments or Rummy's quest for full spectrum dominance of the internet. Perhaps he meant all of the above...

Heading back to the topic of communists and peak oil, I occasionally wonder if the far left component of the doomer crowd is an example of the phenomenon I talked about in "The Philosopher's Stone", where they are attracted to the idea of peak oil causing economic collapse as it lays the foundations for civil unrest and revolution (though personally I'd say that if this scenario were to come to pass in the west you'd be far more likely to end up with full blown fascism).

While I was listening to the RU Sirius podcast I was pondering the whole idea of the revolutionary "vanguard" taking over the apparatus of the state and then using it to create the conditions for a "real" communist society. I must admit I haven't got the foggiest what the desired end-state actually looks like, but the gang of 4 seemed to also hold my cycnical belief (well documented by George Orwell) that once a group of people grab absolute power they're going to find reasons to keep hold of it, no matter what. This just reinforces my belief that wannabee revolutionaries are flogging a dead horse (in the west anyway - they seem to be having more luck in Latin America - but having a society not far off from a feudal style of organisation probably makes for much more fertile ground for socialism than we have here - even if the Bushies are trying their best to replicate the South American model), particularly given that their memetic base is well past its prime, for a variety of reasons.

Given my personal political leanings (which are all over the map admittedly), I think people concerned about social justice and its intersection with the the environment might be better off studying the likes of Paul Hawken (whose upcoming movie "Blessed Unrest" sounds like it is worth keeping an eye out for) and Amory Lovins and their ideas about "Natural Capitalsim" and the Viridian idea of remaking capitalism from the bottom up rather than trying to overthrow it.

Ricardo Semler is also an interesting case study (though the Rockefeller connection would probably give tinfoil types the heebie jeebies). SBS had an interesting report on Semler and his company SEMCO last year:

In Brazil, on the factory floor and in the office, workers at the SEMCO manufacturing and services conglomerate pretty much call their own shots. Some might call it Anarchic Socialism, maybe others, cutting-edge capitalism - whatever, it's certainly paying financial dividends. Indeed, it's so successful that it's unorthodox "worker participation" approach is being extended to other fields as well. Well you might ask is there anything this bold Brazilian experiment could teach us here in Australia?

Sunny Brazil is a magnet for tourists. Each year thousands flock here looking for sun, sand and the good life. But I've come here looking for Brazil's other gift to the world. Welcome to SEMCO.
It might not look like it, but this is one of the world's most radical workplaces and the difference begins at reception.
In fact SEMCO has two receptionists - nothing unusual about that except that the company itself doesn't know which one will be there to greet you.

JOAO NETO: But we are not sure which one will be there in the morning and which one will be there in the afternoon. Because they talk to each other, they set their own schedule.

It seems the CEO doesn't have an office and he's leaving early. He's not the only one. IT worker Joao Neto gives himself every Monday off. He didn't ask for permission and he knows it'll be very hard for his supervisor to check up on him. Like these employees, he keeps changing work stations. It's a rule designed to make employees hard to track.

JOAO NETO: We can even work here, because if you have one area where you have all the fixed desks, the supervisor may be there and see, 8 o'clock, who's not here. But he is not supposed to do that, right? So the company is providing means to avoid that.

RICARDO SEMLER, SEMCO: We don't want to know what time people came in, how many hours they work, we want to negotiate a contract with them for much more important things that have to do with our survival which is what are we going to do this month, and what do we get from them out of this salary or this value that we are paying and what do they get out of us in terms of gratification for their life, the rest to us is secondary.

The SEMCO philosophy is that a lot of what managers normally do shouldn't be done.

RICARDO SEMLER: Absolutely I would say that maybe 30% of people's time is spent trying to understand why people make more than they do, how come people came late, why weren't you at the meeting, can you do this by Wednesday at 6 o'clock, and it's all very silly and there's an enormous waste and of course at a certain point in time people just sort of dumb down and they say, you know, "This is too much work, what do you want me to do, I'll just do my nine to five thing, I'll learn how to survive in this environment."

That's not what happens here. It seems that knocking off early isn't a problem if the work's been done. Normally this machine shop turns out parts for merchant ships. But the workers here supervise themselves - and had gone home for the afternoon when we turned up.

JOAO NETO: Well they are grown up, and they are producing what is required.

And here's another radical idea. Each business unit within SEMCO, gets to pick its own furniture. This workplace has deliberately chosen cheap chairs.

JOAO NETO: Why, because they want to, they want to spend the money in somewhere else.

SEMCO's workers are frugal when it comes to spending their business unit's money, they each get a share of its profits. And then there's this - a cartoon guide to reading the company's accounts produced by the union and the company. Staff have access to all of the company's financial data and SEMCO wants to make sure its workers understand what they are reading. Ricardo Semler believes that unions still have an important role in his company, although as in many places they are in decline.

RICARDO SEMLER: Unions have less of a role because we deal more openly with these issues anyway, but we ourselves are looking for ways to substitute the decline of unions for internal processes where people elect - every 10 people elect somebody who is a keeper of the cultural values and who has job stability, people who can look at every firing and hiring and be able to take an independent position about it in the name of the employees.

With workers virtually running the business you could be forgiven for thinking that this cutting edge capitalism has a distinctly socialist tinge.

RICARDO SEMLER: If you say, you know, is this Trotskyist or Marxist, is this New Socialism, is this European Socialism? I don't think so because the basic issues of the free market are there, which is - tell us how much time you want to work, tell us how much you need to make, tell us what you need in exchange, how you gratify yourself by doing something like this, and this does away with the political ideology issues which of what ism does this fall under because its just respecting anthropological issues instead of political ideas.

Every six months, every SEMCO worker is invited to select his or her salary. He or she is given information about what workers in similar jobs are getting elsewhere.

JOAO NETO: Average, minimum, maximum, the sizes of the companies.

...

It seems like nirvana. But it hasn't been easy for the locals, nor has it been easy for the students in Ricardo Selmer's school or the workers in his firm.
RICARDO SEMLER: They are under a tremendous amount of responsibility because they're on their own, meaning that if the sales don't happen the business unit ceases to exist, if the student doesn't learn anything they really don't have the capacity to go out into the world, if the hotel people are not able to give sustained service at a quality level, they are not going to have customers and guests, so in this format they are obliged to actually make things happen and that responsibility is many times more unforgiving than it sounds.