Is a Bigger Bubble Looming?

This is 46 minutes but well worth it.

Updates on the politics and finances of warming

The UK's left-wing Guardian has a report on battered warming alarmist Phil Jones, the principle participant in the Climategate controversy. You will remember that Jones was the man who told a skeptic that he wouldn't release his data because the skeptic would be looking for errors in it.

Jones appeared before a Parliamentary Investigation and was asked about his refusal to release data so that it could be scrutinized. Jones said replied: "I have obviously written some very awful emails." MP Graham Stringer asked again: "But you wouldn't let him have the data." Jones replied: "We had a lot of work and resources tied up in it."

The Guardian said that was Jones "digging himself in a little deeper." Truly it is, but does reveal something that is true about human nature that explains a lot about the politics of warming. This is an example of what Tyler Cowan would call the "inner economist." People invest in things, and when they invest, they don't want to know that their investment was wrong or misguided. They want confirmation and don't want bad news. There is a natural tendency to seek out what verifies our beliefs and avoid material that doesn't. Jones was protecting his investment.

Jones admits that he didn't give out the material because he had a "lot of work and resources" invested in his theory and he simply didn't want someone finding the flaws. That is an honest admission. It is also one of the reasons I try to reconsider my positions on issues with some regularity—hence the reason I recently changed my mind on hate crime legislation (which is not the same thing as hate speech legislation which I oppose). My reasoning is at the end of this post.

Jones brought his vice chancellor, Edward Acton, with him as part of his support and defense. Acton made an important concession, and Jones didn't repudiate him when he did so:

Acton conceded that not everything pointed in the same direction. It's acknowledged that several hundred years ago Earth became much warmer. If we knew why, we could explain a lot. "The early medieval period is something we should spend more time researching," he mused. This was probably the first time anyone had said that to a parliamentary committee since Simon de Montfort ran the place.

In a previous interview with the BBC Jones admitted that there has been no significant global warming global warming since 1995. And he said that since 2002 the temperature trend has been toward cooling "but this trend is not statistically significant" as well. Jones also said that the if the Medieval Warm Period "was shown to be global in extent and as warm or warmer than today then obviously the late-20th century warmth would be be unprecedented." This is one reason the alarmists spent so much time and energy trying to eradicate the MWP. Many of them have gone so far as to say the MWP is a myth and didn't exist. So for the Jones "defense team" to admit "that several hundred years ago Earth became much warmer" is a significant concession.

Jones said he collaborated with climate units in the US, Russia and Japan and "We may be using a lot of common date." Telegraph columnist Gerald Warner says that is significant. "It is the raw data that matters. If that is wrong, nuances of interpretation based on it are irrelevant..."

A column published by the Australian Broadcasting Company makes an interesting point that is often neglected in this debate: almost all the funding pushes research in one direction. Joanne Nova looked at the "money trail" of the climate debate and said that the skeptics "are actually the true grassroots campaigners, while Greenpeace defends Wall St." She notes the skeptics are up agains "a billion dollar industry aligned with a trillion dollar trading scheme." Nova notes "that there are no grants for scientists to demonstrate that carbon has little effect. She writes:

...there is no group or government seriously funding scientists to expose flaws. The lack of systematic auditing of the IPCC, NOAA, NASA or East Anglia CRU, leaves a gaping vacuum. It's possible that honest scientists have dutifully followed their grant applications, always looking for one thing in one direction, and when they have made flawed assumptions or errors, or just exaggerations, no one has pointed it out simply because everyone who could have, had a job doing something else. In the end the auditors who volunteered — like Steve McIntyre and AnthonyWatts — are retired scientists, because they are the only ones who have the time and the expertise to do the hard work. (Anyone fancy analysing statistical techniques in dendroclimatology or thermometer siting instead of playing a round of golf?)

Nova notes the corporatist elements, how the State Capitalists (as opposed to free market types) stand to benefit from carbon trading schemes. She says there was $126 billion in carbon trading in 2008. "Every major finance house stands to profit as brokers of a paper trade. It doesn't matter whether you buy or sell, the bankers take a slice both ways. The bigger the market, the more money they make shifting paper." And this poses a problem for the skeptics:

Unpaid sceptics are not just taking on scientists who conveniently secure grants and junkets for pursuing one theory, they also conflict with potential profits of Goldman Sachs, JP Morgan, BNP Paribas, Deutsche Bank, HSBC, Barclays, Morgan Stanley, and every other financial institution or corporation that stands to profit like the Chicago Climate Exchange, European Climate Exchange, PointCarbon, IdeaCarbon (and the list goes on… ) as well as against government bureaucracies like the IPCC and multiple departments of Climate Change. There's no conspiracy between these groups, just similar profit plans or power grabs.

I have repeatedly tried to point out, to my friends on the Left, that their efforts routinely are corrupted by the political process. Any honest history of Big Business will show that the Left has routinely handed Big Business massive amounts of wealth, via the regulatory process, which they could not earn honestly in free, competitive markets. Nova is correct when she notes that Greenpeace is the ally of Wall Street.

Here is a great musical number from Evita that is appropriate.

Crony Capitalism

One of the great myths, pushed by both Right and Left, is that Big Business is needs Big Government to keep it under control. In reality, Big Business usually advocates Big Government because it knows that it is able to control the regulatory process for its own benefit. And it does. The political Left, some of whom are well-meaning but naive, often plays up this alleged conflict to their benefit. Obama, in his State of the Union speech, played that same note over and over. He denounced Wall Street and Big Banks yet he has lavished billions of dollars on the groups he attacked and his own administration is riddled with officials he picked directly out of the very companies he was deriding. It's a con job from start to finish.

John Stossel discussed crony capitalism in this episode of his new show and I thought it well worth watching.

Jonah Goldberg wants you to notice him.

Jonah Goldberg, over at National Review, is a conservative obviously. Thus as someone clearly mentally challenged Mr. Goldberg is known to say dumb things. He recently took a swipe at libertarians because of our opposition to the war on drugs. One point that has been made about the war on drugs is that, all things being equal, the police are keener to lock up blacks who use drugs than whites who use drugs. In addition, the war on drugs itself was directly linked to race baiting at the time our first drug laws were passed.

Goldberg, in typical conservative logic, says that because libertarians point out the racist nature of the war on drugs this proves that libertarians are, of course, racists themselves. Not only that, but to point this out is “unlibertarian,” as if Mr. Goldberg is an expert on the topic. He says that pointing out the racist elements in the war on drugs, “from proud individualists” seem “a bit off” because “the classical liberal is supposed to see people as autonomous and sovereign moral actors, not identity politics groups.”

Apparently noticing how the laws on drugs are applied against one class of people in one way, and different ways against another class of people, is playing identity politics and some form of racism. The way the law is applied is clearly racist.

Goldberg has a bug up his ass because libertarians didn’t bow down and worship his book Liberal Fascism. The original subtitle of Goldberg’s book was the absurd: The Totalitarian Temptation from Hegel to Whole Foods. Tom Palmer said the subtitle was stupid and he hoped Goldberg was ashamed of it. It was stupid, Palmer was right, but conservatives have no shame—otherwise they wouldn’t be conservatives.

Palmer said this because the owner of Whole Foods, John Mackey, “is a friend of mine, and he’s no fascist.” Goldberg apparently smeared Whole Foods merely because organic food is associated with the left. Now, I’m no fan of organic. I think it's a major rip off, but there are lots of things I consider to be a waste of money—National Review, for example. Goldberg’s juvenile response was relatively mature by Right-wing standards. He said “because Mackey is a libertarian and perhaps because he’s a libertarian sugar daddy, anything having to do with him, Whole Foods or the organic food fetish is beyond criticism.”

In this case Mr. Goldberg is simply spreading a falsehood. Yes, Mackey is a libertarian. Whether he is a libertarian sugar daddy I don’t know. I haven’t known anyone to get funds from Mackey though I’m sure some people do. If he wants my address and account details I’ll be happy to provide them but I won’t hold my breath. But, I don’t know of any circle of people who are more skeptical of the organic craze than libertarians.

Palmer, at the time he wrote those remarks, was a top executive at the Cato Institute, the premier libertarian think tank. One of their books is Bountiful Harvest, which had an entire chapter on “technophobia, “ natural foods and organic food. Goldberg, because Palmer rightfully pointed out that his subtitle was crap, smears Palmer and libertarians by implying that because Mackey might be a “sugar daddy” for libertarians “the organic food fetish is beyond criticism.” I’m sorry; Mr. Goldberg confuses conservative ethics for libertarian ethics. Cato was denied a $1 million grant by a foundation run by conservatives because Cato refused to back down on their anti-interventionist position in regards to war. I doubt they would cave in to Mackey over organic food.

Goldberg just had a bruised ego because his title was juvenile smear mongering and Palmer called him on it. Goldberg attacked Tom over having not read the book in question. But it wasn’t the content that was being discussed, just the uber-stupid subtitle, which later got dropped.

In a second post on libertarians and his book Goldberg implies that libertarians are finally seeing the light in regards to his book’s thesis. This is silly since the thesis of his book is not original to him and was being discussed in libertarian writings while Goldberg was just a spermatozoa. Goldberg whines that “the general libertarian reaction” to his book disappointed him. He proclaims that his own book is possibly “the most successful libertarian-themed book in a very long time.” Perhaps his humility is off-putting?

Goldberg is pissed off that libertarians aren’t buying his books, not that they disagree with it’s content. He bitches that libertarians “will at least have to explain why I am a fool for what I wrote when all these reasonable folks are arguing in blog posts much the same thing in response to mere headlines of the day, while I fleshed out the same argument over hundreds of pages and in footnoted detail.” He thinks the lesson that libertarians should learn from Obama’s corporatism is “to reconsider my book” first, and then, “reconsider libertarianism’s understandable but lamentable slide away from the right in recent years.”

At least the book comes first. As for the slide away from the right, he forgets that the right was never a friend to libertarianism. At best the right and libertarians had a short-term alliance to oppose the authoritarianism associated with the advocates of state socialism. That alliance doesn’t mean that the right and libertarians have all that much in common. Libertarianism has as much in common with National Review conservatism as it does with Mother Jones progressivism. It is entirely different from the two. A read of some of the rabid anti-gay bigots at National Review makes it clear that conservatives are not friends of liberty.

Libertarianism is a third view, not a variant of Progressives or conservatives. At best libertarians can find short-term alliances for strategic reasons among the two, but a long-term marriage is out of the question. As for Goldberg’s book, I didn’t bother to read it. I can’t speak for all libertarians but I can speak for myself. I didn’t read Goldberg’s book because I think he is a first class jerk. When I read the original subtitle of his book, I too, thought it was just stupid. I’ve meet associates of Mr. Mackey, several of them, but I don’t think our paths have crossed, though I believe we were in the same room a few times. We just never said hello. And I’m sure there are many things where Mr. Mackey and I would disagree. What I couldn’t comprehend was why Mackey’s business was considered a fit target by Goldberg for the implication that it was somehow associated with fascism.

Mr. Goldberg is right to drag the Progressives over the coals for their economic fascism. But where was he was he when George Bush was doing the same thing? Lets not forget that another aspect of fascism, under Mussolini and Hitler, was the adoration of the family and the worship of motherhood, it was anti-choice on abortion and almost anti-gay enough to make born again Christians happy. This moral fascism was a strong component of the authoritarian movements of the 40s. While Mr. Goldberg was putting the Left on the rack he spent precious little time pointing out the authoritarianism of the Right.

The closest to actual fascism we have seen in recent years has been the Bush administration and the Huckebee campaign. You see it in their hatred, not just for economic freedom, but for social freedom as well. Others who have flirted with full fascism have been Pat Buchanan and George Wallace, in 1968. Contrary to the impression of many, American fascism has often come laden with overt religious messages, such as the Klan at its height or the policies of William Jennings Bryan.

Our friends at Freedom Democrats wrote:

The fact is, I simply disagree that "corporatism" is a phenomenon of the left. Associating the "left" with the Dem Party and the "Right" with the GOP is, in many ways, misleading. Progressivism, or what I more accurately call, "Corporate Liberalism," has nothing to with being left-wing. Corporatism is many ways a centrist position, an "establishment" position, and thoroughly dominates both parties. The last really major "anti-corporatist" element of the GOP was the Taft wing, the so-called "Old Right," an element that Goldberg has repeatedly dismissed as irrelevant.

If anything, Goldberg has it wrong, as Freedom Democrats pointed out. The original Left was classical liberalism, the original Right was the feudal order, those conservatives preserving traditional values, such as church and state in alliance, land titles held by the feudal elite, protectionism and controlled markets.

There was corporatism long before the socialists came along. The original liberals, like Smith, Cobden and Bright, spent much of their time attacking the mercantilist system that existed in their day. Socialism did not arise as a “radical left” movement at all, but as the radical center. The socialists adopted liberal goals but decided to use conservative means, corporatism for one, as the way to achieve those goals. Socialists wanted to use the state power that the political right advocated for their own goals.

At its core Goldberg’s book is wrong. Yes, corporatism was associated with the Progressives and socialists, that is old news and was covered by many other writers. But this was a “center left” position, not a radical left position. The radical left of the day was fighting for free markets and disestablishment of church and state, not looking for some state-business alliance. In reality the fascism that Goldberg fears was always a hallmark of the Right. The so-called progressive Left adopted those Right-wing programs in the hopes that they could achieve Left-wing goals. In this sense, Goldberg has it almost precisely backwards. Fascism, as in corporatism, didn’t emerge from socialism; it existed long before any socialist came to power. Socialists adopted the Right-wing view and thus become corporatists, or fascists. The true Left, the classical liberals, were always in opposition to fascism regardless whether the leaders of the movement called themselves Right-wing or Left-wing.

Photo: Mr. Goldberg practicing for his role in the Easter play.

Let them sink.

Obama is out of control. The man seems to think he is elected to micromanage private business. The way this man, with the messianic complex, is acting, he thinks he is Caesar, not a president with specific, enumerated powers. And none of those powers give him, or his puppet Congress, the power to manage private business, or to turn major industries into government pawns.

In just a few short weeks Obama has proven himself to be worse than George Bush, when it comes to the infection of the imperial presidency. Recently the Obama administration told General Motors to fire its CEO and to merge with an Italian auto manufacturer. Now he is telling General Motors and Chrysler to submit plans to him on their reforms and complaining they aren’t moving fast enough. He also says that he will not allow the US industry to “simply vanish.” What he means he is that he will subsidize a few badly run companies that are held hostage by their unionized workforce.

In one of his scripted messages (without the script he’s not so eloquent) he said, “We, as a nation, cannot afford to shirk our responsibility any longer.” We aren’t. Chrysler or General Motors are NOT “our responsibility” Mr. President. They aren’t your responsibility either. Let us get something straight. Presidents, even those who think they are Jesus and JFK rolled into one, are not elected to manage the economy. They have no such powers enumerated by the Constitution. Their duties are few and precise. But then we’ve not elected a Constitutional president is a very long time.

Obama says that the US auto industry is “a pillar of our economy.” Nonsense. The US auto industry is a relatively minor percentage of the economy. If they can’t survive close them down. There are plenty of good cars on the market, manufactured in the United States. We don’t need Chrysler or General Motors.

Let us be clear, Obama has zero business experience. He doesn’t even write his own speeches that so mesmerize the Obamatrons. Normally that is not a problem for the president since presidents are not elected to run businesses. But Obama is clearly engaged in a radical take-over of the private sector by the government. Mussolini would be proud of his cozy relationship with big business and his micromanaging the economy.

Elected officials rarely have the experience necessary to run a business effectively. On a collective basis, where political concerns dominate, they are totally unable to do so. Just look at what happens when politics gets hold of something as simple as education if you don’t believe me. Add in the perverse incentives of political management and state control of any industry is asking for trouble. Politics is about the most perverse method of solving problems that we have. The best solution, in this state-created crisis, is to let the bad companies go under, and the sooner the better.

Once these industries collapse than the valuable labor, tools, factories, etc., will be snapped up by individuals who are able to put them to profitable use. All these factors in production still hold value. But the management of these resources is wrong. Reallocating them to more profitable uses are the only solution to the economic crisis. Sustaining unprofitable uses is not a solution, it is the problem. Ultimately Obama’s solution is like treating a cold with pneumonia.

Uninformed remark of the day.

Matt Yglesias wrote:

Atlas Shrugged is a stupid book, Ayn Rand is a stupid woman, and John Galt’s ideas are stupid. That said, none of them are nearly this stupid. Rand’s novel isn’t about a world in which executives who build companies based on a lot of incorrect decisions, then pay themselves millions of dollars while bankrupting their firms, then come to the government hat-in-hand asking for bailouts, then find that the bailers-out want to attach some strings to their hundreds of billions of dollars in public funds and then go to hide out in Galt’s Gulch. That doesn’t make any sense at all.

Has Yglesias actually read Atlas Shrugged? One of the lead villians is James Taggart, an incompetent businessman who wants to use political influence, not talent, as his source of income. Rand wrote of "Mr. Mowen," the president of Amalgamated Switch and Signal Company, who can't complete jobs and argues that business must be run for the good of everyone. There is Orren Boyle, the head of Associated Steel, who is a prime example of the corportists who use state power for their own benefit. Paul Larkin is another businessman who is unsuccessful and part of the looters. The board of directors of Taggart Transcontinental are all the worst sort of businessmen.

I do fear that Rand overestimated the number of decent businessmen at the corporate level. Corporate America is happily and inseparably intertwined with the political elite. And a huge amount of legislation acts to redistribute wealth in their direction. The media, however, keeps up the charade that government and Big Business are in opposition to one another. Uninformed leftists then push for regulations, to rein in Big Busines, but which Big Business then uses to their benefit since these regulations usually restrict competition and drive up costs. Meanwhile Big Business is lined up to get "bailed out" at the expense of the true entrepreneurs and businessmen, the small business owner.

Big Business is not, as Rand thought, "America's persecuted minority." Big Business, working with the political elite, is using state power to plunder the productive segments of the economy. This is not to say that some large corporations, probably most of them, don't also produce things of value. But production of value, and using state power to one's benefit, are not mutually exclusive. Most corporations managed to do both. But Big Business is not the champion of free, depoliticized markets by any means.