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.

EU "green" policies uproot poor Africans.

Wealthy European nations are uprooting poor Africans from their homes in order to take the land to grow biofuels. In the name of the “saving the planet” they are once again attacking the poorest of the poor.

Joint deals between African governments and European governments are pushing farmers off their land so that it may be confiscated for biofuel projects. As typical of such arrangement the governments are giving the major biofuel corporations sweetheart deals.

For instance, in Tanzania the government has give the British corporation Sun Biofuels, 22,230 acres of farmland for the next 99 years. In exchange the company is supposed to invest $20 million in local infrastructure. If you are interested that means the “rent” for the land amounts to $9.08 per year per acre!

Der Spiegel reports:

Sun Biofuels is not alone. In fact, half a dozen other companies from the Netherlands, the United States, Sweden, Japan, Canada and Germany have already sent their scouts to Tanzania. Prokon, a German company known primarily for its wind turbines, has already begun growing jatropha curcas on a large scale. It expects to have 200,000 hectares (494,000 acres) -- an area about the size of Luxembourg -- under cultivation throughout Tanzania soon.

A gold rush mentality has taken hold -- not just in East Africa but across the entire continent. In Ghana, the Norwegian firm Biofuel Africa has secured farming rights for 38,000 hectares (93,860 acres), and Sun Biofuels is also doing business in Ethiopia and Mozambique.

Kavango BioEnergy, a British company, plans to invest millions of euros in northern Namibia. Western companies are turning up in Malawi and Zambia, where they plan to produce diesel fuel and ethanol from jatropha curcas, palm oil or sugar cane. Foreign investors have their eye on 11 million hectares (27 million acres) in Mozambique -- more than one-seventh of the country's total area -- for growing energy plants. The government in Ethiopia has even made 24 million hectares (59 million acres) available.

All this is to produce fuels which are so cost-ineffective that they require subsidies to exist. Governments in the West are taking the hard-earned income of working people in order to transfer it to wealthy corporate interests who are working with “enviro friendly” politicians. Those corporations then use a small amount of that subsidize to steal the land of poor people in Africa in order to grow more crops for bio fuels.

This alliance of corporate interests, Western politicians and corrupt African governments pay no attention to what their policies to do poor people. Der Spiegel says: “In none of these places are the needs of local residents taken into account.” In one rural area of Tanzania “thousands of residents are being forced to move to make way for the Swedish company Sekab’s plans to grow sugarcane, a highly water-intensive crop, on at least 9,000 hectares (22,230 acres) and then distill it into ethanol.” According to the report the residents have received no compensation and were told they will “get what you are entitled to” but no information is available. I suggest, based on my experiences living in Africa, that the residents will get nothing.

As land is gobbled up by the corporate/government alliances of the West less land will be available for the production of food for local consumption. This means the poor in Africa are getting shafted by Western politicians twice. First, the entire subsidy program on biofuels has forced up food prices dramatically. The World Bank says this subsidy program “to save the planet” is responsible for 75% of the increase in food costs in recent years. So the subsidies are forcing up food prices everywhere, including Africa. Secondly, the subsidies are being used to steal land from peasant farmers in Africa thus depriving them of their ability to feed themselves.

So the poor in Africa get hit first with higher food prices on the world market and then they get hit again as their own farming land is stolen to be given to wealthy, politically-connected Western corporations.

Please note that Left-wing parties are supportive of these programs. Once again the Left-wing agenda is easily subverted to serve the bottom line of corporate interests. The Left just never learns that state power is rarely used for the poor but almost always ends up in the hands of the rich and powerful. The expansion of state powers is precisely what corporations need -- not laissez faire markets. If the Left wanted to strip corporations of their ability to do harm, such as what is now being down in Africa, then they should cut the regulations, cut the subsidies and put the corporations in a competitive marketplace.

In a competitive marketplace these wealth “ethanol” corporations are unlikely to exist. They are politically created monsters and, while they hurt everyone, they harm the poorest, most vulnerable people the most. And they do so with the complicit assistance of the political Left. Historically the Left has to realize that by relying on state power to accomplish worthy goals they far too often end up stealing from the poor in order to give to the rich.

Big Business and politicians: a dangerous combination.

It was 1988, but I still remember one particular night at the movies. It was unusual in several ways. First, the film being shown had never been shown to a large audience prior to this. Second, the showing was being hosted by the film makers, Francis Ford Coppola and George Luckas. Third, Luckas attended with his then girl friend Linda Ronstadt. Fourth, the film, Tucker: The Man and His Dream, instantly became one of my favorites and did so entirely on its own.

Admittedly the film does what Hollywood always does with factual stories --- make them better. Reality rarely lives up to Hollywood standards. And if films were meant as historical documentaries that would be a problem. But the artist, the film maker, recreates reality. Good art ought to always be better than reality.

What this film does is dramatize an important political reality but first a brief synopsis. Preston Tucker wants to build the “car of the future”. But in post-World War II America that means getting hold of assets that the government tied up for war production and is now releasing according to what benefits the politicians who have the power. Preston surprisingly gets to use a factory but only due to union pressures for a new car factory.

He sets about building his dream car. But men brought in through financial deals, who have connections with the auto industry, want to interfere and prevent his innovations. A U.S. Senator, working on behalf of the Big Three auto companies, begins to interfere and targets Tucker. The Big Three fear the innovations and the cost of “retooling” to catch up with him. They want to use political power to stifle competition. The Senator wants to be cozy with the Big Three since that is profitable to him. The Senator, from behind the scenes, uses the court system and the media to try to destroy Tucker and his company.

Here you have big business portrayed as corrupt, uncompetitive, and opposing an open, free market. In other words, you have a dramatic representation of what actually does happen in the world of state capitalism -- which is vastly different than the world of the free market.

Adam Smith, the first major author of a treatise on capitalism wrote about how businessmen use will enter into agreements to use political power to rip off people. Big Business thrives on political interference and fears free markets. They always have and always will. There are a few exceptions, of course, but the low-lifes that you find at Archer Daniels Midland or Enron are more than typical.

Let us start with the premise that all businessmen, and the rest of us as well, are greedy. We want as much as we can get for as little effort as possible. In free markets the way to expand wealth is to produce what people want. To advance yourself you must advance the living standards of others. Since you have no power to force them to purchase from you then you must seduce them with things they want and are willing to buy. That is the economic means of profit.

The other method for profiting is the use of the political means. Through state power one redistributes wealth from unwilling consumers to favored business interests. This can be done in a multiplicity of ways. Sometimes the state merely bans competition outright. This how Bell Telephone grew so big -- other competitors in there markets were forbidden for decades. This is often true of electric companies for instance.

Another use of political power to redistribute profits to the wealthy is the use of tariffs. They drive up the costs of foreign competition thus encouraging consumers, of their own free will (as they see it) to buy the local product. Another method favored by the business elite is a series of regulations which actually cost business lots of money.

Why would they impose such high costs on themselves? This is favored by the established big companies in order to prevent smaller companies from arising and effectively competing with them. Each regulation drives up the cost of business. The major corporations can afford to have an entire department which just dots the "i" for the bureaucrats. The small guy can’t. This additional cost is not really a cost to the big corporation, but an investment that pays hefty dividends by preventing new competition from coming into the market, thus favoring the established, wealthy few.

The more political involvement in the market place the happier the major big corporations will be. They know how to influence that process. They have the massive sums of money necessary to buy the candidates. All one has to do is watch how Big Business interests purchased the support of Hillary Clinton and Barack Obama when it comes to the ethanol scam. The only people who really benefit from ethanol are the major Agricultural companies and the Big Energy companies that produce it and collect the subsidies.

Too often our friends on the Left think that this process is capitalism at work. But this process is politics at work. Remove the power of the politician and the business interests are forced to compete in open markets. Those seeking wealth via the economic method love that. Those seeking wealth via the political process hate it. Because the Left doesn’t understand this well they frequently end up being used by the very Big Capitalists that they hate.

The business interests whip up some hysteria demanding regulations. The Left climbs on board, foolishly thinking that will reign in Big Capital. Big Capital uses the regulations to stifle competition screwing over the consumers and small and mid-size businesses wanting to compete. One need merely read the history of the antitrust legislation to see precisely how major Wall Street interests used Left-wing sentiments and political pull to push through legislation that made industry less competitive and more profitable for the Big Boys.

This is not to say that Conservatives are any smarter. They certainly aren’t. They have a tendency to think that all Big Business is some bastion of morality and a testament to the virtues of free enterprise.

What the Conservatives also fail to understand is that it is precisely this kind of political power that creates the welfare state which they oppose. If government were simply to regulate markets, stifle competition and monopolize power and capital in the hands of the few, it would eventually collapse or face a revolt.

Instead the government then purchases the support of the public by offering them benefits to try and undo some of the unpleasant consequences of previous interventions in the economy. When regulations are put into place, which increase the profits of the Big Boys, there are unhappy consequences. Unemployment, for instance, will be higher. The politicians then buy off the unemployed with benefit schemes. As Sheldon Richman puts it, government is very good at breaking people’s legs and then making them happy by giving them crutches. And the Left is always ready to hand out crutches without considering how that helps the process of breaking legs in the first place.

This works because the crutches from government are very visible. But the process by which legs are broken is not so obvious. A make-work program creates obvious jobs for the “unemployed”. The regulations which prevent jobs from opening in the market, and thus creates that unemployment, are not so obvious. Often the measures which harm people are subtle, difficult to see, and complicated to understand. The benefits are always visible, obvious and simple. That the benefits are always less than the costs is rarely understood.

Whether Tucker isn't entirely accurate, when it comes to the facts, that is not the point. That the film shows how major business interests use political power, however, is important. And this film shows that process very well. It is a process that I wish more people understood, both on the Left and the Right.

I say that because, if it were understood better, a great deal of the division that people assume exists between Right and Left would actually disappear. Certainly there would still be points of differences, some real, some as illusionary as this one. But understanding this political process would help bridge our gaps and move us toward a more unified solution. This understanding is amazing because it really does unite some views long believed to be polar opposites. It does show the ugly side of Big Business and it also illustrates Reagan’s point that “government isn’t the solution, it’s the problem.”