Friday, June 03, 2011

Enviro elitists keep America unemployed

This Friday will mark the release of the May unemployment report. A report that will reflect the last effects of the Obama trillion-dollar stimulus and of the Federal Reserve’s quantitative easing (QE2).

The report is likely to show that job creation is mediocre at best, with unemployment insurance claims continuing well above the 400,000 weekly level, housing in a double-dip recession and the gross domestic product contracting to a paltry 1.8 percent growth rate for the second quarter of 2011.

The situation is so dire on the economic growth front that The New York Times has awoken from its slumber to opine, in a May 30 piece titled “The Numbers Are Grim,” that:

“Republican lawmakers have responded to renewed signs of weakness with a jobs plan that prescribes more of the same 'fixes' that Republicans always recommend no matter the problem: mainly high-end tax cuts, deregulation, more domestic oil drilling and federal spending cuts.

"The White House has offered sounder ideas, including job retraining, plans to boost educational achievement and tax increases to help cover needed spending.”

In just a few lines, the Times managed to encapsulate the left’s complete lack of understanding of why jobs are created.

To be clear, jobs get created in private enterprise when additional labor is required to produce goods or services that will increase the profit of the enterprise.

Jobs don’t get created:

A: because people are trained to do them.

B: because people have higher educational attainment.

C: by raising taxes on those who we hope will create the jobs.

So why aren’t private employers employing more people? Perhaps this real-life example will help shine a light.

In Alaska, one of the most significant finds of copper, gold and molybdenum (hardens steel) in U.S. history was discovered. Yet almost a decade later — and more than $125 million of environmental and cultural studies later — the Pebble Mine is still being subjected to Environmental Protection Agency review. A review that is at best likely to demand that tens of millions more dollars be spent for additional studies encompassing an area roughly equal to the states of Maryland and New Jersey combined. All to open one mine and put 2,000 miners to work.

To make matters worse, the ore won’t be processed in the U.S., because our domestic copper smelting capacity has been cut by about 60 percent in the past 20 years. More jobs lost largely on the altar of environmental regulation.

This is just one of myriad examples of how our nation’s obsession with litigation and environmental regulation has turned us into a place where employers cannot afford to create jobs. It is cheaper and more profitable to do it elsewhere.

As we approach this Friday’s unemployment report, our leaders are already telling us that 9 percent unemployment might be the “new normal.” It will be interesting to see if the real story that America’s failure to create jobs is largely a self-inflicted choice by a college-educated elite who would rather consign millions of Americans to government dependency rather than get out of the way and allow them to work.

Somehow, I don’t think so.


Don’t look behind the green curtain

Warmists champion secrecy while skeptics hold open conference

Global warming alarmists are throwing a temper tantrum this week after a Virginia judge affirmed that scientists who receive public funds to study global warming are subject to Freedom of Information Act (FOIA) requests regarding their taxpayer-funded research. The alarmists’ outrage at being required to divulge and justify the data and theories that lead to their predictions of doom and gloom stands in stark contrast to the often-vilified skeptics who welcome scientific transparency with open arms.

A Virginia state judge issued a May 24 order requiring the University of Virginia to produce by Aug. 22 documents the university acknowledges are subject to public disclosure under the Freedom of Information Act. A separate order sets the stage for the American Tradition Institute to review and challenge the withholding of documents the university claims are exempt from disclosure owing to asserted academic freedom or proprietary research claims.

One might expect that Michael Mann, a former University of Virginia professor whose research and documents are at the heart of the FOIA dispute, and other prominent alarmists would welcome scientific transparency as a means of affirming their global warming predictions. Of course, that presupposes the scientific evidence they refuse to disclose actually supports those claims.

Mr. Mann has led or participated in panels that have received more than $5 million in taxpayer-funded research grants. Instead of expressing gratitude at receiving public funding and committing to transparency in his taxpayer-funded research, Mr. Mann said, “I think it’s very unfortunate that fossil-fuel industry-funded climate-change deniers … continue to harass UVa., NASA and other leading academic and scientific institutions with these frivolous attacks,” according to the Washington Examiner.

Is it really “frivolous” and “unfortunate” that the public requests openness and transparency from the people who apply for and receive public funding for their research?

Compare Mr. Mann’s recalcitrance with the openness of the scientists who will be speaking later this month at the Heartland Institute’s Sixth International Conference on Climate Change (ICCC), which starts June 30. Prominent scientist Roy Spencer will happily answer questions about how he collects and reports global temperature data on behalf of NASA and its Aqua satellite instruments. Meteorologist Anthony Watts will talk your ear off if you ask him about how he assembled and reported data documenting the strong urban heat-island effect that alarmists claim is a myth. Numerous others will be equally transparent.

While alarmists like Mr. Mann fear the disclosure of their methods and data, skeptics have long championed transparency and openness. What does that tell you about who is and who is not confident the data back them up?

Just as importantly, skeptical scientists are far from the ill-informed mavericks that alarmists allege. Scientists from MIT, Harvard, Columbia, Duke, NASA, NOAA and a plethora of other prestigious universities and research institutions have spoken at past ICCCs. Not only have they voiced their skepticism regarding alarmist global warming predictions, but they have assembled for ICCCs precisely because they welcome and encourage the sharing of scientific information at the heart of the global warming debate. Ask them a thoughtful question about their data and methodology, and you will not be slapped with a cease-and-desist order.


Cooler heads contend with climate panic

by Jeff Jacoby

THE MAY 21 APOCALYPSE foretold by the fundamentalist minister Harold Camping may not have materialized, but end-of-the-world doomsaying goes on as usual among the global warmists.

The climate fearmongering persists, as in this story from the Guardian, but polls show that fewer people find it convincing.

"Worst ever carbon emissions leave climate on the brink," a story in The Guardian was breathlessly headlined over the weekend. It reported -- hyperventilated might be a better verb -- that greenhouse gas emissions increased in 2010 "to the highest carbon output in history, putting hopes of holding global warming to safe levels all but out of reach."

The Guardian attributed word of this "shock rise" to the International Energy Agency, whose chief economist is "very worried" because "this is the worst news on emissions" and the climate outlook "is getting bleaker." It cites another expert's "dire" warning that if carbon dioxide isn't drastically reduced, global warming will "disrupt the lives and livelihoods of hundreds of millions of people across the planet, leading to widespread mass migration and conflict."

All that is nothing, however, to the climate fearmongering in Newsweek, which insists the global-warming Rapture is already underway.

"Worldwide, the litany of weather's extremes has reached biblical proportions," Newsweek intones, pointing to tornadoes in the US, floods in Australia and Pakistan, and drought in China. "From these and other extreme-weather events, one lesson is sinking in with terrifying certainty. The stable climate of the last 12,000 years is gone." This is what comes of burning fossil fuels for energy, which has increased atmospheric CO2 levels by 40 percent above what they were before the Industrial Revolution. "You haven't seen anything yet," Newsweek preaches. "Batten down the hatches."

By now, of course, few things are more familiar than predictions of the environmental catastrophe to which the use of carbon-based energy has supposedly condemned us. In 1992 Al Gore claimed that "evidence of an ecological Kristallnacht is as clear as the sound of glass shattering in Berlin;" nearly 20 years later he is still warning of "an unimaginable calamity requiring large-scale, preventive measures to protect human civilization as we know it." Like Camping, Gore and other climate alarmists keep forecasting a Day of Doom that never arrives. And like Camping -- who now says the world will end on Oct. 21 -- they continue to be sure that disaster is just around the corner.

But hyperbolic climate rhetoric doesn't scare as many people as it used to. Gallup reported in March that of nine leading environmental issues, global warming is the one Americans worry about least. In Britain too, as The New York Times noted last spring, fear of climate change has receded, as more and more people conclude that the dangers have been over-hyped.

Take the recent increase in global CO2 emissions. Is the Guardian's panicked anxiety -- Climate on the brink! -- really a sensible response? Writing in the journal First Things, the distinguished Princeton physicist William Happer makes a compelling case that rising carbon-dioxide levels are neither unprecedented nor anything to fear.

"Carbon is the stuff of life," he points out. "Our bodies are made of carbon." Yes, atmospheric CO2 is higher today than it was before the industrial age -- 390 parts per million now vs. 270 ppm then -- but there was a time when "CO2 levels were several thousand ppm, much higher than now. And life flourished abundantly." Indeed, greenhouse operators artificially boost CO2 concentrations in order to grow better flowers and fruit.

Climate change is natural; long before humans were burning fossil fuels, planetary temperatures ebbed and flowed.

So why recoil from the modest increase in carbon emissions caused by fossil fuel use? Because more CO2 means more climate change? Happer shoots down that idea. The earth's climate is always changing, sometimes dramatically. During the medieval warming of a thousand years ago, temperatures were much higher than they are now; during the Little Ice Age six centuries later they were much lower. "Yet there is no evidence for significant increase of CO2 in the medieval warm period, nor for a significant decrease at the time of the subsequent little ice age."

Newsweek's "stable climate of the last 12,000 years" is a myth. So is the notion that higher carbon emissions are a prescription for climate disaster. Carbon dioxide is only one of several factors that influence the earth's temperature, Happer writes, and "seldom the dominant one."

The global-warming alarmists have had a good run, as the global-cooling alarmists did before them, but fewer and fewer people are finding the doomsday prophecies persuasive. Scaremongering wins headlines; fact-based skepticism eventually wins arguments.


"Green" Google under fire

Today, at Google's annual shareholder meeting in Mountain View, California, the National Center for Public Policy Research challenged CEO Larry Page over the perception that there may be a conflict of interest between the company and a member of its board of directors.

On behalf of the National Center for Public Policy Research, General Counsel Justin Danhof presented a Conflict of Interest Report shareholder proposal. Danhof asked Page to disclose board member investments that conflict with the company's finances and to report any incidents of board member activity that breached Google's Code of Conduct Policy.

"Today, shareholders were told how Google Board Member John Doerr's personal investments, coupled with Google's new green energy outlays, raise questions of conflict and impropriety," said Danhof.

Doerr is a partner with Kleiner Perkins Caufield & Byers, a venture capital firm that is heavily invested in alternative energy. Doerr's firm and Google have both invested large sums in the same small geothermal company, AltaRock.

"Even though our proposal did not pass, our call for transparency received a rousing ovation from the shareholders in attendance. Google executives heard loud and clear that shareholders want to know more about what is motivating the company's alternative energy investments," said Danhof.

At the meeting, Google executives made repeated claims that they spent little shareholder money on "so-called speculative" investments.

"Google's explanation dodges the issue. If Google and Doerr have nothing to hide, why did they fight our shareholder proposal?" said Danhof. "Shareholders should be outraged at Google's shroud of secrecy. Without transparency, it appears either that Doerr is pulling the strings on Google's alternative energy spending, or that Google is using shareholder money to boot Doerr's investments. Each scenario is a losing proposition for Google investors" said Danhof.

Google has been spending millions of shareholder dollars in the volatile alternative energy markets. Reuters reported in October 2010 that Google invested an undisclosed amount in a $5 billion offshore wind energy project to be built in the Atlantic Ocean.

"Google is a technology and Internet company. By focusing on its core business it has created great shareholder value. Alternative energy markets are speculative and rely on government subsidies. Google shareholders shouldn't be at the mercy of Washington politicians who may well decide to limit or reduce green energy subsidies in the future," said Danhof.

"Nothing truly worthwhile hides in the dark. I hope today's meeting serves as a wake-up call to Google's leadership that its members are responsible to the company's true owners – the shareholders."


10 Reasons to abandon ethanol as a motor fuel

The ongoing turmoil in the Middle East has resulted in higher gas prices, inconveniencing Americans who are already attempting to pick up the pieces following the recent economic downturn. In recent years, ethanol has become a popular alternative to gasoline because of its low cost and ability to burn cleanly. However, with the government's quest to increase ethanol production and reduce our dependence on oil, the latter of which is a necessary goal, many of ethanol's flaws have been overlooked. Whether you're concerned for the environment or just a college kid on a budget, you should first consider the following 10 reasons to steer away from the corn-based fuel before making it a regular purchase.

* Ethanol is less efficient than gasoline: It requires 1.5 gallons of ethanol to drive the same distance as you would with one gallon of gasoline. Depending on the vehicle, that can translate to about five or six miles per gallon fewer on highway driving and four or five miles per gallon fewer during city driving, a major inconvenience for people who are already tired of filling up more often than they should.

* Although less expensive, ethanol ultimately costs the same as gasoline: When this article was written, the average price of e85 was $3.34 and the average price of gasoline was $3.80. Given ethanol's aforementioned relative inefficiency, the cost of filling up a tank with ethanol ultimately costs the same as filling it up with gasoline. So drivers of Flex Fuel vehicles, many of whom may not even know they have such a vehicle, should think twice before driving all over town looking for a filling station with ethanol.

* In many regions, too few filling stations offer e85: It's necessary for e85 users to have a go-to filling station on or near the route of their daily commute because of its relative inefficiency. But with too few stations nationwide, driving a vehicle on e85 is even less efficient. The sprawling Houston area, for example, the sixth largest metro area in the country, has 16 stations serving e85, including surrounding towns such as Katy and Tomball. It would require lots of fuel just to find a station with ethanol.

* The U.S. is years away from gaining the capacity to become reliant on ethanol: In 2010, Americans consumed more than 138 billion gallons of gasoline. In February 2011, production capacity of ethanol in the U.S. was more than 13 billion gallons (12 billion gallons is almost equivalent to nine billion gallons of gasoline), meaning that if we were to become more dependent on it in the near future, we'd either have to make rapid strides in production or consider importing more of it — there's currently a tariff on ethanol produced in Brazil. Although ethanol production is expected to continue to expand, land use is a real issue (as mentioned below), particularly relating to indirect land use change and its effect on grain supply.

* One bushel of corn produces 2.8 gallons of ethanol: That's from a 56-pound bushel of corn, which also produces 18 pounds of feed for livestock and poultry and corn oil used in many human foods. The U.S. demands 4.9 billion bushels per year. Again, it would require a vast amount of resources, including land, to meet the requirement ethanol dependence would place upon us. Currently the U.S. is using 30 million acres of cropland for that purpose, fueling the food versus fuel debate.

* Ethanol can have a negative impact on food production and prices: Since roughly 2008, there has been much debate regarding ethanol's effect on food prices. This year, the U.S. will consume 15 percent of the world's corn supply, five percent more than three years ago when corn prices peaked. Of the corn produced in the U.S., 24 percent is mandated for ethanol production, reducing the worldwide availability of the veggie. Poor countries with citizens who spend a large portion of their daily incomes on food would be affected the most by expensive corn.

* The increased production of ethanol results in deforestation, more carbon dioxide: The increased use of land worldwide for ethanol results in the upheaval of forests and savannahs, releasing more carbon dioxide and causing the clean-burning fuel to have a minimal positive impact on the environment. In fact, a 2008 paper asserted that in the short term, ethanol could be twice as carbon-intensive as petrol. This fact is often overlooked because there's such a strong, unified lobby for ethanol, and it has long been looked upon as the most viable clean alternative.

* The production of ethanol could negatively affect topsoil: The process by which ethanol is produced involves the growing of corn to make hybrid seeds and the subsequent planting and harvesting of them. The cycle results in the depletion of topsoil, an invaluable and irreplaceable resource needed to sustain agriculture. Although the depletion of topsoil for food purposes is inevitable, it should be preserved as much as possible. It goes without saying that food is more important than fuel.

* Ethanol produces a large water footprint: According to Environmental Science & Technology magazine, the amount of ethanol needed to fuel a vehicle for one mile is 50 gallons, a high number when you tally what's used for an entire crop. Of course, the water use comes almost entirely during the agricultural cycle. With the expansion of irrigated agriculture in dry Western areas, many are concerned about the potential impact that would come with a major demand for ethanol.

* The production of ethanol could negatively affect water quality: Fertilizers widely used for crops in the U.S. include phosphorus, nitrogen, fungicides, herbicides, pesticides and insecticides, each of which, to some degree, is absorbed into our waterways. The highest concentrations of these chemicals are found in the Corn Belt, located in the Upper Midwest, and in the Mississippi River, contributing to the dead zone in the Gulf of Mexico. In that area, giant algae bloom, feast on the fertilizer and consume oxygen in the water, killing sea life.


Carbon tax baloney

Henry Ergas comments from Australia

ROSS Garnaut's new report released this week starts with an episode of enlightenment. "I" the report opens (and suitably so, for the personal pronoun appears to be the professor's closest friend), "was explaining to the Multiparty Climate Change Committee how I had worked out the costs and benefits of reducing emissions.

"The costs come straightaway. The benefits come later. So I needed a way of comparing income now with incomes of young Australians later in their lives and who are not yet born. 'So we had to choose the right discount rate', I said.

"Then I said something that brought back the Prime Minister's attention. 'If we used the sharemarket's discount rate to value the lives of future Australians,' I said, 'and if we knew that doing something would give benefits now but cause the extinction of our species in half a century, the calculations would tell us to do it'."

Triumph! "The smile on the Prime Minister's face became a hearty laugh. 'You've got us there, Ross', she said, as the others were infected by the lift in spirits. 'That's a unanimous decision. We're all against the extinction of the human species'."

Thank God you're here, Professor Garnaut! But had Julia Gillard known any economics, she would have known the claimed demonstration makes no sense.

If an outcome is certain, its consequences should be discounted to the present at the risk-free rate, not at the market rate that has uncertainty built into it.

Moreover, if an action causes certain death, it should be assessed as costing at the very least the entire wealth of the generations affected. It should therefore be treated entirely differently from small or marginal changes in exposure to harm. Thus done properly, the standard analysis works perfectly well. But had Garnaut explained this, he would not have had his story.

And that sets the pace for the economics in this report, in which loose assertions fly thick and fast.

We are told, for example, that so as "to improve the tax system through reducing tax disincentives to work", carbon revenues should be used to substantially increase the income tax's tax-free threshold. But the inevitable consequence would be to raise effective marginal tax rates as the threshold tapers.

Indeed, although this is nowhere noted in the report, Garnaut's proposal would raise effective tax rates in the middle-income bracket by about 5 percentage points, that is by 17 per cent. Such an increase, affecting more than 60 per cent of taxpayers, would greatly reduce incentives to work and save.

Nor does the looseness end there. In discussing the resources boom, the report says that "for each new mine or gas plant, there must be a cut in jobs and investment in other businesses".

Yet that is only true if we cannot import capital and labour, as we have ever since European settlement: but here too, the vital caveat is not added, presumably for fear of spoiling a good story.

Looseness then reaches Himalayan heights in the discussion of innovation, where the report tells us that at a time of large changes in relative prices and in economic structure, private expenditure on innovation falls short of socially valuable levels by an especially large amount, so the case for public subsidy is especially strong. But this unbacked claim is inconsistent with economic theory and with a mountain of studies starting in the 1930s.

Or consider electricity networks, where the report says that "it is clear from market behaviour" that over-investment has occurred because "the rate of return that is allowed exceeds the network's cost of capital". But economists have developed powerful tests for assessing this precise issue. The report does not apply a single one of these tests to back up its airy claims, nor cite any careful studies that do.

And take the question of comparing "direct action" with market instruments such as emissions permits. Here the report is unequivocal: "Using direct action measures would raise costs much more than carbon pricing". Yet growing research shows that (in the words of leading environmental economist Ian Parry) in the presence of market imperfections, "the superiority on cost-effectiveness grounds of permit systems over technology mandates and performance standards could be overturned".

On a matter of such political sensitivity, it would have behoved the report to at least acknowledge those results; it doesn't. And it would equally have behoved it to treat the comparison between alternative policy instruments as an empirical matter; again, it doesn't.

In fact, to do so would be inconsistent with the report's style, which is to demonise its opponents. They are, it says, "spoiling voices" who live in "isolation from reality".

Unlike Garnaut, they have not "joined Jiang Zemin in reciting the Gettysburg Address with the fruit at the end of a meal"; how could they understand China's actions?

As for their arguments about what Australia should do, they do not reflect a genuinely held alternative view of the public interest: rather, theirs are "narrow interests", while Garnaut speaks for " objective truth" representing the "informed centre that has no sectional interest that leads it to oppose the national interest."

Such claims are the hallmark of a fatal pretence: the pretence of embodying the "general will" that alone can soar above the "will of each". But even putting aside their inherent flaws, these claims of disinterestedness would be more credible were the report not knee-deep in proposed wealth transfers, showering largesse on beneficiaries ranging from the solar industry to the climate scientists who have been Garnaut's vocal supporters.

Yet the best comes towards the end. Here Garnaut paints a glowing picture of 19th-century economist William Stanley Jevons, whose 1865 book The Coal Question argued that Britain's dependence on coal meant "the maintenance of Britain's economic position is physically impossible". These words, Garnaut comments, "have a special resonance for Australians, as we face the same choice outlined by Jevons".

But the The Coal Question was entirely wrong. Britain did not run out of coal in 1900: indeed, it is unlikely to do so in 2100. Little wonder The Coal Question is long forgotten. Could its fate be this report's future?



For more postings from me, see DISSECTING LEFTISM, TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC, GUN WATCH, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL and EYE ON BRITAIN. My Home Pages are here or here or here. Email me (John Ray) here. For readers in China or for times when is playing up, there are mirrors of this site here and here


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