The Silence is Broken…
We have previously remarked on the curious fact that global warming did not even rate a mention during the presidential debates, a first since the AGW hysteria began to gather steam in the early 1980's.
Something many readers may not be aware of: the first politician propagating the AGW theory and putting her weight behind it was actually Margaret Thatcher. At the time the theory was still in its infancy, some unknown climate tinkerer in Scandinavia had come up with it. Thatcher saw it as a gift that could help her in her struggle against Arthur Scargill and the UK coal mining unions. By portraying coal as a contributor to a dangerous climate trend, Scargill would lose the public's sympathies – this is how her calculation presumably went. We wonder if she had been so enthusiastic had she known what would become of this particular propaganda exercise. It sure has taken on a life of its own.
Anyway, now that president Obama has been reelected, he has suddenly 'rediscovered' the topic of climate change.
Many politicians love the almost endless possibilities it offers to tax and regulate businesses and consumers alike. After all, who can possibly be against contributing a little something to save us from certain disaster? As you will see below, big business loves it too. The new taxes and regulations are yet another obstacle standing in the way of upstart competitors. Consumers and society as a whole are losing out, economic progress stalls, but rent seekers all over the show are growing fat and happy.
What 'We' Allegedly Want…
As Ezra Klein reports on the president's climate agenda in the Washington Post:
„We want our kids to grow up in an America… that isn’t threatened by the destructive power of a warming planet.” That was the president in his acceptance speech Tuesday night. Now that Obama has won reelection, apparently, he feels free to talk about climate change — a topic notably absent during the campaign. Now what does he actually plan to do about it?
An Obama second term could have fairly significant implications for energy and climate policy. Many of the bigger initiatives from his first term now won’t likely be repealed, from strict fuel-economy standards on automobiles to regulations on coal-fired power plants. And those could all have a modest effect on the America’s oil use, its energy mix — and ultimately its heat-trapping carbon emissions. Yet doing anything bigger on climate change will likely require working with a Republican Congress.“
We would comment here that what 'we' really don't want is for our kids to grow up in a cooling world. Now that would certainly be a disaster of major proportions. However, there is nothing we could do about it. It seems actually highly likely that the world will eventually cool down again, as it has done regularly and repeatedly in the past following periods of warming. It also seems pretty certain that an if the planet were to cool down by eight degrees Celsius or even more as has happened in the distant past, it won't be able to support seven billion plus people. Unless, that is, if capital accumulation has progressed to the point that all food can be profitably grown in greenhouses and everybody has a nicely insulated abode to live in. This is one of the reasons why one must be so careful about implementing policies that are certain to retard economic growth and capital accumulation.
The list of Obama's likely climate related initiatives Klein supplies in his article unfortunately indicates that the implementation of such policies is precisely what is going to happen.
Fuel Economy Standards
„Stricter fuel-economy standards are here to stay.´In his acceptance speech, Obama promised to work with Congress on “freeing ourselves from foreign oil.” Yet his most ambitious move on this front won’t require Congress at all. His administration has already set new rules requiring new passenger vehicles sold in the United States to average 54.5 miles per gallon by 2025, up from 29 miles per gallon today.“
It should be pointed out here that every single president since the 1970's has promised to 'free us from the dependence on foreign oil'. This is simply economic nonsense. If oil can be produced competitively elsewhere, why should one not buy it? As it were, market forces and human ingenuity are already at work to reverse the decline in domestic US oil output, which has been rising quite strongly of late – in fact, it has reached an 18 year high. And no, the government did 'not build that'.
Daily US oil production in 1,000ds of bbl. – rising strongly to an 18 year high – click for better resolution.
Monthly domestic US crude oil production – click for better resolution.
As the “Post Libertarian” blog wrote on the fuel efficiency standards and the way they were sold to the public (the entire post is well worth reading as it were):
“The Corporate Average Fuel Economy (CAFE) program always felt like an amusingly bureaucratic invention to me. First you have to quantify “average miles per gallon” for a single vehicle that varies significantly by highway or city and various driving conditions. Then you have to quantify that average across an entire manufacturer’s fleet (is it by number of vehicles sold? is it by number of models?). Additionally, a mandate based on miles per gallon is built on an assumption that the MPG is fairly constant regardless of trip length, but hybrid and electric vehicles break that assumption. Now you have to forcibly quantify into your old system a vehicle that uses no gas for X miles and then either uses Y mpg after that or can’t go anywhere at all. Finally, once you assume you can quantify everything satisfactorily, you build a new assumption that future technology will be able to meet an arbitrary number sometime in the future.
Another suspicious aspect about the mandates is that most of the major auto manufacturers “.” Industry support for regulation is often used as proof that the regulation is good, but if you’re familiar with economics you know that established big businesses tend to support regulation because it increases costs they can handle while raising barriers to entry that protect them from new competition, which ultimately hurts consumers with higher costs and less innovation.
They say these mandates are supported by 13 manufacturers that make up 90% of the market, and there’s still plenty of competition between them, but I don’t understand the alleged reason for manufacturer support: it gives them “the certainty they need to make manufacturing plans far into the future.” If consumers already want better mileage, and they think they can handle it, why do they need a mandate to do it? Why don’t they just supply it already? It’s supposed to be a win for consumers because now they’ll get better gas mileage, but the whole thing feels to me like a bizarro paradigm where The White House sets the Reality of What Is Possible To Make. Consumers can’t demand and manufacturers can’t supply better cars until the Voice of the Executive Branch speaks, but once it speaks, suddenly it’s possible for more efficient vehicles to roll off the assembly lines. (Why doesn’t the Voice speak an even higher number?)”
EPA Regulation of Coal Plants
Klein informs us further:
“The Environmental Protection Agency’s existing rules on coal plants will survive. In Obama’s first term, the EPA set strict limits on mercury pollution from coal-fired plants and put an upper limit on the amount of carbon dioxide that could be emitted from any new power plant built in the United States. Combine those EPA rules with cheap natural gas and rising mining costs, and coal is in trouble.”
Coal was already in trouble before these rules were established, as the market found ways to vastly increase the production of natural gas by employing new drilling and extraction methods. Of course natural gas is not going to stay that cheap if coal fired plants are shut down. And it appears the plan is precisely to wage a war on coal that will end with the industry's destruction. It will also cost the economy a fortune and hit numerous poor communities especially hard. According to the non-partisan Manhattan Institute, the cost could amount to $700 billion. Writes the institute:
“On March 27, the EPA proposed what it calls the first “Clean Air Act standard for carbon pollution for new power plants.” The proposal, if enacted, will effectively outlaw the construction of new coal-fired power plants in the United States. It is one of a myriad of rules leading to what some have called the “regulatory death” of domestic coal-fired electricity production. Shortly after the EPA announcement, Democratic Senator Joe Manchin of West Virginia said the move shows that the EPA is engaged “in a war on coal.”
There’s no denying that coal has earned its reputation as a relatively dirty fuel. Generating electricity by burning coal results in higher levels of carbon emissions than does burning oil or natural gas. But the EPA should not prohibit the use of coal based on its carbon dioxide emissions. Doing so ignores modern advances in plant design and construction that have steadily improved air quality. But more to the point, prohibiting coal will increase the cost of producing electricity—a cost which will ultimately be paid by consumers—while doing almost nothing to reduce global carbon-dioxide emissions.
Despite its drawbacks, coal remains a cheap, easily accessed, and abundant domestic fuel source. In other words, there is still a case for coal. The EPA should revisit its proposed ban on new coal-fired power plants. It is bad policy for several reasons:
1.The anti-coal regulatory regime reduces access to a vital source of energy.
2.Electricity producers need to retain a balanced fuel mix. Prohibiting a specific fuel has been tried in the past by regulators.
3.The newest coal plants are clean by traditional EPA measures.
4.Prohibiting construction of new coal-fired generation units won’t do anything to achieve the EPA’s stated purpose of reducing global carbon dioxide emissions.
We would add to this that it isn't even clear to us why carbon dioxide emissions are considered 'bad'. There is plenty of evidence from ice cores that suggests that the link between global warming and carbon dioxide in the atmosphere works exactly the other way around from that claimed by the 'climate consensus'. This is to say, increases of CO2 in the atmosphere appear to follow temperature increases with a considerable lag. A recent paper suggests that this lag effect (which has to do with the release of CO2 from the oceans) is even observable in much smaller time frames, which strongly supports the ice core evidence. One of the most important highlights of said paper is the following point:
But meeting that target depends on a few things. States would have to continue to promote renewable power. California would have to get its cap-and-trade system working. Natural gas would have to stay cheap. And the EPA would have to strengthen its rules on carbon dioxide from power plants and keep the fuel-economy rules in place.”
To these 'few things' (leaving aside for the moment whether reductions in carbon dioxide emissions are even desirable or useful):
Regarding the 'promotion' of renewable power, see our comments on wind energy above. It just makes no economic sense, and very likely therefore also makes no environmental sense. It merely lines the pockets of vested interests. 'Cap-and-trade' is a major boondoggle that has so far been failing spectacularly wherever it has been tried. The artificial 'carbon markets' have collapsed. But the vested interests, represented by professional climate alarmists in most cases, . No wonder there is 'interest' in reviving this mad idea.
'Natural gas would have to stay cheap' – is this some kind of joke? Two paragraphs further above Klein has just explained why it cannot possibly stay cheap if the president and the environmental bureaucracy have their way.
As to 'strengthening the rules on carbon dioxide from power plants', see the discussion above. It can be done, but at great cost to the economy and consumers, especially the poorest strata of society, for whom energy costs represent a very large portion of their income and spending (the authoritarian left rarely mentions such things, so we feel compelled to spell them out).
A Number of Proposals Won't Fly – We Hope
Klein then concludes wistfully:
“Bigger action on climate will require Congress. Obama has signaled at many points that he would be open to more sweeping action to tackle global warming. He has proposed a clean energy standard that would require utilities to get a greater portion of their electricity from renewables. Joseph Aldy, a former White House official, has hinted that Obama would be open to a carbon tax if Republicans were willing to negotiate.
But Obama would have to get those proposals through Congress first. And, after that, he’d then have to revive international climate talks with countries like China and India, which have been flagging of late. We’re still a long, long ways off from a world “that isn’t threatened by the destructive power of a warming planet.” By itself, Obama’s re-election can’t change that.”
Obama would be 'open to a carbon tax'? That sounds almost as though he were reluctantly weighing the pros and cons of such a step. Why not admit that he's practically chomping at the bit to impose one?
Anyway, this final paragraph leaves one with a small modicum of hope that the most radical proposals simply won't fly, as neither the Republican controlled Congress, nor China or India seem overly eager to sacrifice the economy on the altar of climate alarmism. As it were, we have more faith in China and India in that regard than in Congress, where such issues are often decided through the influence wielded by lobbyists.
Meanwhile, we are writing this post from a place that has lately been bitter cold and could really use a good dose of warming. Where the hell is it? Twenty years ago were fervently hoping that we might live to see better (and especially much warmer) weather in these here parts. No such luck so far.
Charts by: AEI and skepticalscience.com
It is that time of the year again – our semi-annual funding drive begins today. Give us a little hand in offsetting the costs of running this blog, as advertising revenue alone is insufficient. You can help us reach our modest funding goal by donating either via paypal or bitcoin. Those of you who have made a ton of money based on some of the things we have said in these pages (we actually made a few good calls lately!), please feel free to up your donations accordingly (we are sorry if you have followed one of our bad calls. This is of course your own fault). Other than that, we can only repeat that donations to this site are apt to secure many benefits. These range from sound sleep, to children including you in their songs, to the potential of obtaining privileges in the afterlife (the latter cannot be guaranteed, but it seems highly likely). As always, we are greatly honored by your readership and hope that our special mixture of entertainment and education is adding a little value to your life!
Bitcoin address: 1DRkVzUmkGaz9xAP81us86zzxh5VMEhNke
6 Responses to “Climate Change is Back on the Agenda”
Most read in the last 20 days:
- A Striking Chart
The Economy and the Stock Market As long time readers know, we are always paying close attention to the manufacturing sector, which is far more important to the US economy than is generally believed. In terms of gross output it is the largest sector of the economy, and it should of course be obvious that saving, investment and production are the only ways to create wealth. What's left of the Brooklyn Domino Sugar Refinery. Photo credit: Paul Raphaelson Contrary...
- Trump and Putin Narrowly Escape Assassination Attempt
The Gloves are Coming Off First a little bit of recent history. Readers are probably aware that some questions about the occasionally malfunctioning Deep State android... no, wait, we'll start again. Questions have recently been raised about the health of presidential candidate Hillary Clinton by various “alt-right” tinfoil hat-wearing conspiracy theorists, such as this one. The monsters are normally hiding under Hillary's bed, but lately they have come out into the open...
- US Economy - Curious Pattern in ISM Readings
Head Fake Theory Confirmed? This is a brief update on our last overview of economic data. Although we briefly discussed employment as well, the overview was as usual mainly focused on manufacturing, which is the largest sector of the economy by gross output. Pepsi factory in Baltimore, 1956 Photo via pinterest.com Readers may recall that we have pointed out for some time that there was quite a large gap between the data reported in regional Fed manufacturing...
- Why the Fed Destroyed the Market Economy
What Have You Done for Me Lately? Swing voters are a fickle bunch. One election they vote Democrat. The next they vote Republican. For they have no particular ideology or political philosophy to base their judgment upon. The primacy of the wallet. They don’t give a rip about questions of small government or big government. Nor do they have any druthers about the welfare or warfare state. In effect, they really don’t care. What’s important to the...
- How is Real Wealth Created?
An Abrupt Drop Let’s turn back to our regular beat: the U.S. economy and its capital markets. We’ve been warning that the Fed would never make any substantial increase to interest rates. Not willingly, at least. Groping in the dark, Yellen-style Each time Fed chief Janet Yellen opens her mouth, out comes a hint that more rate hikes might be coming. But each time, it turns out that the economy is not as robust as she had believed... and that a rate hike isn’t...
- Janet Yellen’s Shame
Playing Politics In honest capitalism, you do what you can to get other people to voluntarily give you money. This usually involves providing goods or services they think are worth the price. You may get a little wild and crazy from time to time, but you are always called to order by your customers. In the market economy, consumers reign supreme. There is no such thing as a “lost” vote in the marketplace; every penny spent affects production. Mises noted: “Consumers...
- Donald’s Electoral Struggle
Wicked and Terrible After touting her pro-labor union record, the Wicked Witch of Chappaqua rhetorically asked, “why am I not 50 points ahead?” Her chief rival bluntly responded: “because you’re terrible.”* No truer words have been uttered by any of the candidates about one of their opponents since the start of this extraordinary presidential campaign! Electoral map (note that the coloration may no longer be applicable...) That Hillary Clinton is...
- Get Ready for a New Crisis – in Corporate Debt
Imposter Dollar OUZILLY, France – We’re going back to basics here at the Diary. We’re getting everyone on the same page... learning together... connecting the dots... trying to figure out what is going on. The new three dollar bill issued by the Apprehensive States of America. We made a breakthrough when we identified the source of so many of today’s bizarre and grotesque trends. It’s the money – the new post-1971 dollar. This new dollar is green. You...
- The Economy, the Stock Market and the Fed
John Hussman on Recent Developments We always look forward to John Hussman's weekly missive on the markets. Some people say that he is a “permabear”, but we don't think that is a fair characterization. He is rightly wary of the stock market's historically extremely high valuation and the loose monetary policy driving the surge in asset prices. The S&P 500 Index and the NYSE advance-decline line. Most market internals weakened steadily until early February 2016, but...
- Hanjin Marooning in San Pedro Bay
Global Trade Reversal Expansions and contractions in global trade have played out over long secular trends for thousands of years. The Silk Road, for example, was established by the Han Dynasty of China in 130 BC, and allowed for continuous trade between East and West for nearly 1,600 years. In addition to economic trade, the Silk Road was also a conduit for culture and knowledge among its network of civilizations. A map of the main ancient Silk Road - click to...
- Great Causes, a Sea of Debt and the 2017 Recession
Great Cause NORMANDY, FRANCE – We continue our work with the bomb squad. Myth disposal is dangerous work: People love their myths more than they love life itself. They may kill for money. But they die for their religions, their governments, their clans... and their ideas. Famous French hippie and author Voltaire. He wears the same sardonic grin in every painting, whether he's depicted at a young or an old age, doesn't matter. His real name was François-Marie Arouet; he...
- The Donald Versus Killary: War or Peace?
War: A Warning from the Past Although history does not exactly repeat itself, it does provide parallels and sometimes quite ominous ones. Such is the case with the current U.S. Presidential election and the one which occurred one hundred years earlier. The Donald probably has the better slogan... The dominating question which hung over the 1916 campaign was whether the country would remain neutral in regard to the horrific slaughter which was taking place on the...