If we've learned anything from recent debacles, I suppose, it is to keep a close eye on Wall Street boys..
Following was edited. Credit goes to Matt Taibbi/Rolling Stone.
Having seamlessly navigated the political minefield of the bailout era, Goldman is once again back to its old business, scouting out loopholes in a new government-created market with the aid of a new set of alumni occupying key government jobs.
Gone are Hank Paulson and Neel Kashkari; in their place arc Treasury chief of staff Mark Patterson and CFTC chief Gary Gensler, both former Goldmanites. (Gensler was the firm's co-head of finance.) And instead of credit derivatives or oil futures or mortgage-backed CDOs, the new game in town, the next bubble, is in carbon credits - a booming trillion dollar market that barely even exists yet, but will if the Democratic Party that it gave $4,452,585 to in the last election manages to push into existence a ground breaking new commodities bubble, disguised as an "environmental plan," called cap-and-trade.
The new carbon-credit market is a virtual repeat of the commodities-market casino that's been kind to Goldman, except it has one delicious new wrinkle: If the plan goes forward as expected, the rise in prices will be government-mandated. Goldman won't even have to rig the game. It will be rigged in advance.
Here's how it works: If the bill passes, there will be limits for coal plants, utilities, natural-gas distributors and numerous other industries on the amount of carbon emissions (a.k.a. greenhouse gases) they can produce per year. If the companies go over their allotment, they will be able to buy "allocations" or credits from other companies that have managed to produce fewer emissions. President Obama conservatively estimated that about $646 billion worth of carbon credits will be auctioned in the first seven years; one of his top economic aides speculates that the real number might be twice or even three times that amount.
The feature of this plan that has special appeal to speculators is that the "cap" on carbon will be continually lowered by the government, which means that carbon credits will become more and more scarce with each passing year. Which means that this is a brand-new commodities market where the main commodity to be traded is guaranteed to rise in price over time. The volume of this new market will be upwards of a trillion dollars annually for comparison's sake, the annual combined revenues of all electricity suppliers in the U.S. total $320 billion.
Goldman wants this bill. The plan is (1) to get in on the ground floor of paradigm shifting legislation, (2) make sure that they're the profit-making slice of that paradigm and (3) make sure the slice is a big slice. Goldman started pushing hard for cap-and-trade long ago, but things really ramped up last year when the firm spent $3.5 million to lobby climate issues. (One of their lobbyists at the time was none other than Patterson, now Treasury chief of staff.) Back in 2005, when Hank Paulson was chief of Goldman, he personally helped author the bank's environmental policy, a document that contains some surprising elements for a firm that in all other areas has been consistently opposed to any sort of government regulation.
Paulson's report argued that "voluntary action alone cannot solve the climate-change problem." Few years later, the bank's carbon chief, Ken Newcombe, insisted that cap-and-trade alone won't be enough to fix the climate problem and called for further public investments in research and development. Which is convenient, considering that Goldman made early investments in wind power (it bought a subsidiary called Horizon Wind Energy), renewable diesel (it is an investor in a firm called Changing World Technologies) and solar power (it partnered with BP Solar), exactly the kind of deals that will prosper if the government forces energy producers to use cleaner energy. As Paulson said at the time, "We're not making those investments to lose money."
The bank owns a 10 percent stake in carbon credits will be traded. Moreover, Goldman owns a minority stake in Blue Source LLC, a Utah-based firm that sells carbon credits of the type that will be in great demand if the bill passes. Nobel Prize winner AI Gore, who is intimately involved with the planning of cap-and-trade, started up a company called Generation Investment Management with three former bigwigs from Goldman Sachs Asset Management, David Blood, Mark Ferguson and Peter Hanis. Their business? Investing in carbon offsets, There's also a $500 million Green Growth Fund set up by a Goldmanite to invest in green-tech...the list goes on and on. Goldman is ahead of the headlines again, just waiting for someone to make it rain in the right spot. Will this market be bigger than the energy-futures market?
"Oh, it'll dwarf it," says a former staffer on the House energy committee.
Well, you might say, who cares? If cap-and-trade succeeds, won't we all be saved from the catastrophe of global warming? Maybe but cap-and-trade, as envisioned by Goldman, is really just a carbon tax structured so that private interests collect the revenues. Instead of simply imposing a fixed government levy on carbon pollution and forcing unclean energy producers to pay for the mess they make, cap and trade will allow a small tribe of greedy-as-hell Wall Street swine to turn yet another commodities market into a private tax-collection scheme. This is worse than the bailout: It allows the bank to seize taxpayer money before it's even collected.
"If it's going to be a tax, I would prefer that Washington set the tax and collect it," says Michael Masters, the hedge fund director who spoke out against oil-futures speculation. "But we're saying that Wall Street can set the tax, and Wall Street can collect the tax. That's the last thing in the world I want, It's just asinine."
Cap-and-trade is going to happen. Or, if it doesn't, something like it will. The moral is the same as for all the other bubbles that Goldman helped create, from 1929 to 2009. In almost every case, the very same bank that behaved recklessly for years, weighing down the system with toxic loans and predatory debt, and accomplishing nothing but massive bonuses for a few bosses, has been rewarded with mountains of virtually free money and government guarantees - while the actual victims in this mess, ordinary taxpayers, are the ones paying tor it.
It's not always easy to accept the reality of what we now routinely allow these people to get away with; there's a kind of collective denial that kicks in when a country goes through what America has gone though lately, when a people lose as much prestige and status as we have in the past few years. You can't really register the fact that you're no longer a citizen of a thriving first-world democracy, that you're no longer above getting robbed in broad daylight, because like an amputee, you can still sort of feel things that are no longer there.
But this is it. This is the world we live in now. And in this world, some of us have to play by the rules, while others get a note from the principal excusing them from homework till the end of time, plus 10 billion free dollars in a paper bag to buy lunch. It's a gangster state, running on gangster economics, and even prices can't be trusted anymore; there are hidden taxes in every buck you pay. And maybe we can't stop it, but we should at least know where it's all going.
Fraudulent and corrupt practices are expected to swallow a whopping $500 billion out of $5 trillion stimulus fundings by governments worldwide, a global report has said.
According to global risk consultancy Kroll's latest edition of Global Fraud Report, government stimulus funding worldwide aggregating $5 trillion has introduced new opportunities for fraud and corruption worldwide.
Though governments are likely to struggle to keep the losses through corruption down, it would "still provide a staggering pot of $500 billion in corrupt gains," the report stated.
Citing data from Transparency International, the global coalition against corruption, the report stated that it has put into perspective the heightened risk brought on by the financial crisis.
"According to the coalition, corruption can raise procurement contract costs by at least 10 per cent in a stable economy – an equivalent of $500 billion in corrupt gains," the Kroll report stated.
Interestingly, in emergency situations these costs can rise as high as 30 per cent of the overall cost of the contract, it added.
I think 100% of government spending is corrupt. Next time go with 1000%. Better bumper sticker.
Bankgeek
Senior Member
posted: Jun. 29, 2009 @ 6:25p
The world could use a new mini ice age right about now.
staci86
Senior Member
posted: Jun. 29, 2009 @ 6:37p
Bankgeek said: The world could use a new mini ice age right about now. Temperatures have declined recently, so be careful what you wish for.
In the 1970's, the mainstream media fueled the global cooling hysteria, and scared the public with threats of an impending ice age.
If we were facing "global cooling" instead of "global warming" right now, the politicians and their campaign donors would be developing a market for carbon subsidies instead of carbon taxes.
The problem lies with economic meddling from those who wish to seek re-election or live large off of government pork, not the specific item which prompted the meddling.
Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance.
Edit to Add: don't confuse right or wrong with what you like or not like people.
nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance.
All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out.
LeveragedSpeculator said: nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance.
All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out.
Edited by Moderator: Edited political commentNote I said I found it harder to ignore but i didn't say i agreed with the skeptics, either. The climate change proponents are using a risk management argument. They say there are unknown and potentially devastating risks associated higher temperature , rising sea levels, etc. They are saying the risk is worth the cost to hedge against. It is a sound argument too.
As to your concern of raising prices, I read that 85% of the carbon permits are going to be given out for free to incumbent emission producers, like the existing coal power generator. It seems to be a big ado about nothing. Maybe it is just a show to coerce China to join the climate control treaty.
nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance. By definition, a global warming skeptic does not agree global warming is real (he is skeptical of that claim). I will admit there is likely a very small signal to noise ratio from that crowd (as they have a lot of data/work to discredit). There is another, much larger, group in the scientific community who are skeptical with Anthropogenic Global Warming (usually referring to atmospheric CO2 in particular). I myself am skeptical that CO2 is the primary driver of the last 30 years of warming. Most of these skeptics online seem to favor solar forcing as a primary driver (I'm slightly more skeptical of that than CO2). Anyway, I haven't spent the considerable time and effort necessary to come to my own conclusions, but I have seen some of the linearized models employed and been disappointed: if anything needs to be treated like a dynamical control system it's long term climate models. Unfortunately even if you do attempt to complicate the complex by another order of magnitude you'll probably get nothing for it because there are millions of sets of equations that will adequately model the past temperature data given the past inputs we know (and making assumptions about those we don't) even if you assume your input and temp data is perfect. Add to that small errors introduced early in said inputs or temps and your model is WAY off.
As for your skeptics, whom seemingly are skeptical of the economic measures being proposed in political communities, I certainly agree that the measures are wrongheaded. But the economic damage won't be in moving Pacific Islanders (they will be expected to move themselves a bit inland over the next hundred years to accomodate 7-23in), but (potentially) increases in tropical storms, more severe droughts and heat spells, increased flooding, as well as expensive solutions for places like London, New Orleans, etc.
staci86
Senior Member
posted: Jun. 29, 2009 @ 10:05p
LeveragedSpeculator said:
All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out. Edited by Moderator: Edited political comment
We in the West are fortunate enough to have economies and incomes sufficient to permit discussion of job-killing legislation of this magnitude.
Elsewhere on the planet, there are billions of people below our standard of living, who can't wait for our cuts in demand to reduce prices for Fossil fuels, and further their own efforts at industrialization. Poorer nations have no problem emitting limitless amounts of carbon if it is the difference between progress and perpetuation of misery. OPEC and other exporters will have no problem meeting that need.
So, in the end, reductions in our demand depress prices, stimulating demand elsewhere, netting little improvement to the global CO2 levels. All we do is kill domestic jobs.
History has shown us that the best way to eliminate technology with undesired effects is for market forces to render it obsolete. When better technology exists, consumers will adapt.
Of course, replacing foreign oil with greatly expanded drilling programs for domestic oil, and funneling all royalties to development of cleaner technologies, is impossible thanks to the many special interest groups who are so completely dissociated from those who will lose their jobs as this legislation puts the brakes on an already weakened US economy. Thanks to lobbyists, Americans seeking relief from high prices, massive trade deficits, and a lack of jobs hold little sway over politicians.
Such common sense has no place in Washington. Instead, Americans will sit idle as Middle Eastern sheiks continue raking in tens of billions, and our government will borrow even more money from China, whose surpluses come from the very behavior our government seeks to stop, to be wasted on boondoggles that do little to solve the problem.
chimeer
Cranky Member
posted: Jun. 29, 2009 @ 10:08p
nycll said: LeveragedSpeculator said: nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance.
All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out. Edited by Moderator: Edited political commentNote I said I found it harder to ignore but i didn't say i agreed with the skeptics, either. The climate change proponents are using a risk management argument. They say there are unknown and potentially devastating risks associated higher temperature , rising sea levels, etc. They are saying the risk is worth the cost to hedge against. It is a sound argument too.
As to your concern of raising prices, I read that 85% of the carbon permits are going to be given out for free to incumbent emission producers, like the existing coal power generator. It seems to be a big ado about nothing. Maybe it is just a show to coerce China to join the climate control treaty.
Problem is that any carbon credit system, that is not global in scale simply moves the carbon emissions from one country to another. So it really isn't about managing risk in any meaningful way, it is about moving carbon heavy industries like manufacturing offshore.
Instead of figuring out ways to handicap the US economy maybe we should be focusing on becoming more competitive.
nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel.
B.S. Global warming skeptics agree that warming is real - they do not agree it is human activities that are causing it. That big fireball in the sky comes to mind.
"Ours is not to ask why, ours to sell and to buy". Heard on NYSE Floor 10/18/1987. ..My guess is GS is not concerned with Global Warming argument, but how to profit from it.
nycll said: LeveragedSpeculator said: nycll said: Most of the global warming skeptics agree global warming is real, and it is likely caused by human activities of burning Fossil fuel. They mostly argue it is better to not engage in costly efforts to curb emissions; instead, spend the money is areas with more bang for the buck, such as health care, education, etc. As an example, they are saying it is far more cost effective to reallocate the pacific islanders when their islands are submerged by rising sea level than curbing CO2 emission to stop the sea level from rising. I find this argument much harder to ignore than the outright denials based on ignorance.
All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out. Edited by Moderator: Edited out political commentNote I said I found it harder to ignore but i didn't say i agreed with the skeptics, either. The climate change proponents are using a risk management argument. They say there are unknown and potentially devastating risks associated higher temperature , rising sea levels, etc. They are saying the risk is worth the cost to hedge against. It is a sound argument too.
As to your concern of raising prices, I read that 85% of the carbon permits are going to be given out for free to incumbent emission producers, like the existing coal power generator. It seems to be a big ado about nothing. Maybe it is just a show to coerce China to join the climate control treaty.
A sound argument for China? You overlook the most glaring point about this is that it is not global in scope. IE: other countries will not jump on any bandwagon to cut emissions. Even if it doesn't result in raising electricity prices (it will with coal generated kwh's for measurement), it will still force more manufacturers overseas and set up additional barriers to US manufacturing.
This will raise prices and further hobble the US economy, which is contracting at a rapid clip.
Dumb leftist Americans don't understand economics. All this will do is drive up the cost of doing business from those businesses that need to emit CO2. Those that can stay in business (power generation) will raise prices. Those that can't (manufacturing) will go out of business and the manufacturing will be moved to countries without this onerous legislation (ie: China).
It doesn't take an economic genius to figure this out.
We in the West are fortunate enough to have economies and incomes sufficient to permit discussion of job-killing legislation of this magnitude.
Elsewhere on the planet, there are billions of people below our standard of living, who can't wait for our cuts in demand to reduce prices for Fossil fuels, and further their own efforts at industrialization. Poorer nations have no problem emitting limitless amounts of carbon if it is the difference between progress and perpetuation of misery. OPEC and other exporters will have no problem meeting that need.
So, in the end, reductions in our demand depress prices, stimulating demand elsewhere, netting little improvement to the global CO2 levels. All we do is kill domestic jobs.
History has shown us that the best way to eliminate technology with undesired effects is for market forces to render it obsolete. When better technology exists, consumers will adapt.
Of course, replacing foreign oil with greatly expanded drilling programs for domestic oil, and funneling all royalties to development of cleaner technologies, is impossible thanks to the many special interest groups who are so completely dissociated from those who will lose their jobs as this legislation puts the brakes on an already weakened US economy. Thanks to lobbyists, Americans seeking relief from high prices, massive trade deficits, and a lack of jobs hold little sway over politicians.
Such common sense has no place in Washington. Instead, Americans will sit idle as Middle Eastern sheiks continue raking in tens of billions, and our government will borrow even more money from China, whose surpluses come from the very behavior our government seeks to stop, to be wasted on boondoggles that do little to solve the problem.You could've saved several paragraphs with "Drill baby Drill". Drilling every square inch of the U.S. won't satisfy our gluttonous oil thirst.
Your economics on our reduction in demand automatically stimulating demand elsewhere is shaky. Is that your economic concept, or did you get it from someone else? Certainly have never seen that from anyone of reasonable repute. Oil dropped by two-thirds this year; what massive industrialization did that cause?
We are the ones to create alternatives; others will follow. That's the way it has worked with every significant technology for the last 100+ years. And I'm talking China, India and Russia -- those are the ones that will make or break the world's environment. Sorry, but if all the Ethiopias in the world burn oil to industrialize, it's not going to be at a big enough scale to cause massive environmental danger, such as China, India, and ourselves are currently doing.
geebeebee said: We are the ones to create alternatives; others will follow. That's the way it has worked with every significant technology for the last 100+ years. And I'm talking China, India and Russia -- those are the ones that will make or break the world's environment. Sorry, but if all the Ethiopias in the world burn oil to industrialize, it's not going to be at a big enough scale to cause massive environmental danger, such as China, India, and ourselves are currently doing.
The way it has worked the past 100+ years is someone innovates and finds someway to change the game. The difference is in the past this limit was naturally imposed (technology), whereas this limit is not technological but legislative (regulation). An aspiring entrepreneur would just find it easier and more cost effective to set up a manufacturing hub in Malaysia, for instance.
I'm not sure if you are very familiar with the manufacturing industries but its fairly easy to outsource even complicated manufacturing processes and products these days. Your support of this does not address that underlying issue of jobs destruction in the US manufacturing sector and increased costs.
staci86
Senior Member
posted: Jun. 30, 2009 @ 12:35a
Even if most other countries do jump on the bandwagon, it still won't solve the "problem."
Large exporters of Fossil fuels will not stop exporting, nor will every single country agree to cap their emissions. This scheme cannot succeed, as it requires complete cooperation from everybody at once.
International diplomats have tried this before. The War on Drugs failed, and right now, over 90% of the world's heroin is sourced from opium grown in Afghanistan, and over 75% of the world's cocaine is produced in Colombia. North Korea is the largest source of counterfeit US currency. Iran is proliferating weapons to terrorists. Nigerians run fraud rings of international reach. Sweden has become a haven for illegal filesharing.
When a problem has a truly global impact, everybody has to cooperate in order to stop it from proliferating. CO2 is even more insidious than many of the other trans-national problems. It crosses borders without smugglers, can't be arrested, can't be spied on, and has no servers that can be shut down.
The various proposals to block imports from countries which don't cooperate won't work either. Much as these carbon taxes will push down the exporter's prices of Fossil fuels, making them more attractive to countries seeking to industrialize, trade restrictions from the West will drive down the exporter's prices of manufactured goods, further driving consumption and development in places which formerly could not afford it.
Like it or not, Fossil fuels are a valuable resource, and where there exists value, somebody will come along to extract it. We can either continue fighting against those seeking to exploit value (even though such tactics almost always fail), or we can work to remove the value of Fossil fuels. Namely, by making them obsolete. Once inherently better technology comes along, at a better cost, Fossil fuels will be obsolete.
In the 19th century, large cities all over the world suffered many deaths due to fire and explosion from the natural gas used for lighting. That problem was solved by one man in a laboratory, not legions of government bureaucrats trying to regulate it out of existence.
staci86 said: International diplomats have tried this before. The War on Drugs failed, and right now, over 90% of the world's heroin is sourced from opium grown in Afghanistan, and over 75% of the world's cocaine is produced in Colombia. North Korea is the largest source of counterfeit US currency. Iran is proliferating weapons to terrorists. Nigerians run fraud rings of international reach. Sweden has become a haven for illegal filesharing.
Like it or not, Fossil fuels are a valuable resource, and where there exists value, somebody will come along to extract it. We can either continue fighting against those seeking to exploit value (even though such tactics almost always fail), or we can work to remove the value of Fossil fuels. Namely, by making them obsolete. Once inherently better technology comes along, at a better cost, Fossil fuels will be obsolete.
In the 19th century, large cities all over the world suffered many deaths due to fire and explosion from the natural gas used for lighting. That problem was solved by one man in a laboratory, not legions of government bureaucrats trying to regulate it out of existence.First of all, comparing illegal activities to a problem that will be solved by technology is a poor comparison. A better one would be computers. Do Chinese companies still use the abacus to calculate?
We are talking about better technology - do you think that we are going to eliminate Fossil fuels without it? You see, we have limited resources, as should be obviously apparent right now. And if we spend those resources drilling for oil (in other words, building bigger abacuses), we won't come up with the technologies required to end our oil obsession. It's a matter of throwing money down a hole, with old-school technology that, as a side benefit, ruins our environment, or actually biting the bullet and fixing the problem instead of passing it on to the next generation.
I'm sure there were people like you lamenting the computer in the 1950s. Sometimes you have to sacrifice current ease and comfort in order to progress.
staci86
Senior Member
posted: Jun. 30, 2009 @ 12:49a
geebeebee said: You could've saved several paragraphs with "Drill baby Drill". That isn't a sound argument. That is a catchphrase embraced by the public, and has no place in intelligent discussion.
geebeebee said: Drilling every square inch of the U.S. won't satisfy our gluttonous oil thirst. Who said anything about 100% replacement? Drilling in the US will satisfy much of the domestic demand, and will certainly create jobs and increase tax revenues, while taking much pressure off of the dollar.
geebeebee said: Your economics on our reduction in demand automatically stimulating demand elsewhere is shaky. Is that your economic concept, or did you get it from someone else? Demand drives price, and price drives demand. That is Econ 101. Of course, you threw in the word "automatically" to plant an insidious straw man escape.
geebeebee said: Certainly have never seen that from anyone of reasonable repute. Limited, obviously, by your definition of "reasonable repute."
geebeebee said: Oil dropped by two-thirds this year; what massive industrialization did that cause? You are attempting to compare a temporary spike to a long-term trend. When oil was at $147 per barrel, it did become unaffordable to those at the margins.
The economic utility of oil falls along a continuum. Economic activity that is profitable at $30 per barrel may not be possible at $147 per barrel.
If Western nations give up, in your words, their "gluttonous thirst" for oil, demand will fall, and the profile of those buyers will shift from rich to poor.
Considering that Saudi Arabia can produce oil for $2 per barrel, there is going to be a willing buyer for it somewhere. The underdeveloped world can't buy it at, say, $20 per barrel, when the West has paid as much as $147.
geebeebee said: We are the ones to create alternatives; others will follow. That's the way it has worked with every significant technology for the last 100+ years. Cap and trade is not technology, it is regulation. As I said earlier, once Fossil fuels have been made technologically obsolete and no longer cost-competitive, then they will fall into disuse. Innovation and price effectiveness cannot be legislated.
geebeebee said: And I'm talking China, India and Russia -- those are the ones that will make or break the world's environment. Sorry, but if all the Ethiopias in the world burn oil to industrialize, it's not going to be at a big enough scale to cause massive environmental danger, such as China, India, and ourselves are currently doing. Nations with millions of unemployed people, or people living at a basic subsistence level, are more than capable of burning that oil.
Unless, of course, you have an energy free way to manufacture products domestically, and somehow also solve the problem of job loss due to over regulation and union proliferation.
staci86
Senior Member
posted: Jun. 30, 2009 @ 12:58a
geebeebee said: First of all, comparing illegal activities to a problem that will be solved by technology is a poor comparison. The illegality is exactly why it is a good comparison. Illegality is nothing more than a governmental decree against a certain activity.
The activities I listed are strictly controlled in most of the world, and loosely controlled, if at all, in other parts of the world. Thus, they have migrated to where they are less controlled.
geebeebee said: A better one would be computers. Do Chinese companies still use the abacus to calculate? That isn't what we're talking about.
We're discussing how we are hurt by a transnational race to the bottom, not the natural progression of technology. Obviously, technology will improve, but until it does, we will have to deal with the collateral damage of regulation.
If calculators were strictly regulated in the United States, you can bet that US companies would be setting up overseas boiler rooms, instead of being crippled due to domestic abacus use. I'm not sure what your point is, as it makes no sense.
geebeebee said: We are talking about better technology - do you think that we are going to eliminate Fossil fuels without it? Straw man.
geebeebee said: You see, we have limited resources, as should be obviously apparent right now. And if we spend those resources drilling for oil (in other words, building bigger abacuses), we won't come up with the technologies required to end our oil obsession. Wrong.
Oil is in demand right now. It is also a fungible commodity. If we drill here in the US, Federal and State lease royalties can be reinvested in research, instead of buying a fleet of 100 Ferraris for every prince in a tiny nation in the Middle East.
Of course, domestic drilling also creates jobs for the unemployed, but you obviously don't care about that. You'd rather cling to your NIMBY mentality, all the while Saudi Aramco continues to export workers from the United States to live and work at their facilities.
geebeebee said: It's a matter of throwing money down a hole, with old-school technology that, as a side benefit, ruins our environment, or actually biting the bullet and fixing the problem instead of passing it on to the next generation. Who said anything about throwing money down a hole? We aren't going to stop using oil tomorrow, or even 20 years from now. That is not a choice we can make. What we can choose is who gets the royalties, and who gets the jobs.
geebeebee said: I'm sure there were people like you lamenting the computer in the 1950s. Sometimes you have to sacrifice current ease and comfort in order to progress. Enough with the useless straw men. I've identified technology, not regulation, as being the solution to the problem.
Are you willing to sacrifice your comfort and ease to "save the planet" (assuming that AGW is even real)? Even if you are, there are places in the world where there is no comfort left to sacrifice, and the people there care about jobs, food, water, and medicine, and couldn't give a damn about the polar bears.
staci86 said: Demand drives price, and price drives demand. That is Econ 101. Of course, you threw in the word "automatically" to plant an insidious straw man escape.If technology changes the game, all that is out the window. If suddenly solar/wind/whatever power is the equivalent of $1/barrel of oil, then $5 oil is not attractive. Maybe that is Econ 102.
It's funny you used a Thomas Edison example. How do you think the oil lantern market did after he invented the light bulb and mass-produced it? Are China and India taking undue advantage of us because of their use of oil lanterns?
This type of thinking is why we are probably 30 years behind where we should be by now. Alternative energies have been around for decades, but the greed and lack of foresight has kept us back from where we should be.
staci86 said: Limited, obviously, by your definition of "reasonable repute."Try me. Of course, this is funny, coming from someone who has such a high opinion of their economics knowledge that they dismiss Nobel Laureates' opinions in favor of their own.
staci86 said: You are attempting to compare a temporary spike to a long-term trend. When oil was at $147 per barrel, it did become unaffordable to those at the margins.
The economic utility of oil falls along a continuum. Economic activity that is profitable at $30 per barrel may not be possible at $147 per barrel.
If Western nations give up, in your words, their "gluttonous thirst" for oil, demand will fall, and the profile of those buyers will shift from rich to poor.
Considering that Saudi Arabia can produce oil for $2 per barrel, there is going to be a willing buyer for it somewhere. The underdeveloped world can't buy it at, say, $20 per barrel, when the West has paid as much as $147.Yes, OK, well, is global output up? I'm looking for ANY basic realities that back that statement up. It's more complex than basic supply and demand, especially when there are alternatives on the horizon.
staci86 said: Nations with millions of unemployed people, or people living at a basic subsistence level, are more than capable of burning that oil.
Unless, of course, you have an energy free way to manufacture products domestically, and somehow also solve the problem of job loss due to over regulation and union proliferation.Just so I get this straight, what countries are you referring to here? Is it China and India? If not, then, frankly, I'm not that interested. It's a drop in the bucket.
what can we do about it?? Send a few people to k*i*l*l all the executives in Goldman? Eventually somebody will do it. This nation is already very pissed off right. Every where you go, you talk to people. All they talk about is how fuuked up this system is. I kon you guys will give me red but we will see what will happen when this nation can't take it nomore.
staci86 said: The illegality is exactly why it is a good comparison. Illegality is nothing more than a governmental decree against a certain activity.
The activities I listed are strictly controlled in most of the world, and loosely controlled, if at all, in other parts of the world. Thus, they have migrated to where they are less controlled.Hey, if you want to compare Fossil fuel production and its effect upon the environment to Nigerian internet scams, go for it (and, unlike you, I won't play the logic-fallacy police game on you). It isn't a remotely viable argument. I'm talking about being, as we have been for over a hundred years, a technological leader. If you want to forfeit that to another country (and those with less infrastructure to re-tool, such as China and India, are perfect candidates) then you have a great plan. Personally, I'd still like to see us lead. THAT is what keeps us in jobs going forward, not a few blue-collar jobs drilling oil. Short-sighted.
staci86 said: Wrong.
Oil is in demand right now. It is also a fungible commodity. If we drill here in the US, Federal and State lease royalties can be reinvested in research, instead of buying a fleet of 100 Ferraris for every prince in a tiny nation in the Middle East.
Of course, domestic drilling also creates jobs for the unemployed, but you obviously don't care about that. You'd rather cling to your NIMBY mentality, all the while Saudi Aramco continues to export workers from the United States to live and work at their facilities.NOTHING would remove the smugness from the Middle-East oil barons than eliminating the need for it. If you can make it unnecessary, you've totally leapfrogged the problem, whereas your piddling drilling solution only postpones the real issue. You have to think big here; our country has been too accustomed to thinking little.
EvilCapitalist said: B.S. Global warming skeptics agree that warming is real - they do not agree it is human activities that are causing it. That big fireball in the sky comes to mind.
No, you don't know what you are talking about. More of them do agree human activities are at least a significant part of the warming. Skeptics dispute warming and each other.
theMerliorist said: By definition, a global warming skeptic does not agree global warming is real (he is skeptical of that claim). I will admit there is likely a very small signal to noise ratio from that crowd (as they have a lot of data/work to discredit). Exactly why I ignored them. Skeptics is a term for legitimate unpopular views, not some nutcases oblivious to facts, like this.
There is another, much larger, group in the scientific community who are skeptical with Anthropogenic Global Warming (usually referring to atmospheric CO2 in particular). I myself am skeptical that CO2 is the primary driver of the last 30 years of warming. Most of these skeptics online seem to favor solar forcing as a primary driver (I'm slightly more skeptical of that than CO2). Anyway, I haven't spent the considerable time and effort necessary to come to my own conclusions, but I have seen some of the linearized models employed and been disappointed: if anything needs to be treated like a dynamical control system it's long term climate models. Unfortunately even if you do attempt to complicate the complex by another order of magnitude you'll probably get nothing for it because there are millions of sets of equations that will adequately model the past temperature data given the past inputs we know (and making assumptions about those we don't) even if you assume your input and temp data is perfect. Add to that small errors introduced early in said inputs or temps and your model is WAY off.Yeah, they are a bigger group but still a minority among the skeptics. You can certainly propose alternatives to the anthorpogenic hopothesis, but they are harder to prove. Although correlation isn't causality, the strong correlation does support causality. More and more scientists are convinced by the ever increasing body of data supporting the correlation.
As for your skeptics, whom seemingly are skeptical of the economic measures being proposed in political communities, I certainly agree that the measures are wrongheaded. But the economic damage won't be in moving Pacific Islanders (they will be expected to move themselves a bit inland over the next hundred years to accomodate 7-23in), but (potentially) increases in tropical storms, more severe droughts and heat spells, increased flooding, as well as expensive solutions for places like London, New Orleans, etc.I only brought up the pacific islanders as an exaple, because they (and the polar bears) are politicized. Politics is a necessary part of policy making, but they neither prove or disappove the science behind it.
chimeer said: Problem is that any carbon credit system, that is not global in scale simply moves the carbon emissions from one country to another. So it really isn't about managing risk in any meaningful way, it is about moving carbon heavy industries like manufacturing offshore.
Instead of figuring out ways to handicap the US economy maybe we should be focusing on becoming more competitive.There is already a Koyto accord which the US is not a part of but Europe and Japan are. And now US is committed to some extent to cut green house emissions. And China hasn't but I believe it will start to address the greenhouse issue. Otherwise everyone will just start impose a tarriff on its exports. So competitiveness will soon take a new meaning than what you are talking about now.
staci86 said: Drilling in the US will satisfy much of the domestic demand, and will certainly create jobs and increase tax revenues, while taking much pressure off of the dollar.You are way off.
US companies have the best techonology to explore and develope oil fields. With a few exceptions (ANWR = low to mid single digit percentage of US oil consumption), they have indeed drilled everywhere for oil in US.
nycll said: EvilCapitalist said: B.S. Global warming skeptics agree that warming is real - they do not agree it is human activities that are causing it. That big fireball in the sky comes to mind.
No, you don't know what you are talking about. More of them do agree human activities are at least a significant part of the warming. Skeptics dispute warming and each other.
Sorry but the selective quoting used by NYT just does not cut it - for example:
"Richard S. Lindzen, a professor at M.I.T. and a longtime skeptic of the mainstream consensus that global warming poses a danger." followed by a semi-quote from him ignores what he actually has been saying which can be seen even on his Wikipedia entry.
EvilCapitalist said: "Richard S. Lindzen, a professor at M.I.T. and a longtime skeptic of the mainstream consensus that global warming poses a danger." followed by a semi-quote from him ignores what he actually has been saying which can be seen even on his Wikipedia entry.Lindzen's view actually fits my description of the skeptics. He doesn't deny the exisitence of the warming nor the role of CO2. So what's your point?
nycll said: EvilCapitalist said: "Richard S. Lindzen, a professor at M.I.T. and a longtime skeptic of the mainstream consensus that global warming poses a danger." followed by a semi-quote from him ignores what he actually has been saying which can be seen even on his Wikipedia entry.Lindzen's view actually fits my description of the skeptics. He doesn't deny the exisitence of the warming nor the role of CO2 plays. So what's is your point?
Huh? Read what he actually wrote. Most of his papers are easily accessible. He's skeptical on CO2 emitted by human activity being the cause of a global warming. He does not disagree that earth has been in the warming part of the cycle as it has been observed. He does not agree that it means earth will continue to be in a warming cycle.
EvilCapitalist said: He's skeptical on CO2 emitted by human activity being the cause of a global warming. The Figure 2 of this paper supports the link between temperature and CO2 level. Nowhere in the article says CO2 didn't increase nor the increase was not from human activities.
To summarize: So what if WE cut down on carbon emissions/etc. What about the rest of the world? You think Asia gives two shits about the environment? Hell no. So, we pay the higher costs now, for what? To make ourselves feel a little better that we're (allegedly) "helping the planet?" In another decade we'll have the "emerging markets/countries" with much higher per capita carbon emissions, and then what..? The reality is that the US is not its own planet. The stupidity NEVER ceases to amaze me..
To summarize: So what if WE cut down on carbon emissions/etc. What about the rest of the world? You think Asia gives two shits about the environment? Hell no. So, we pay the higher costs now, for what? To make ourselves feel a little better that we're (allegedly) "helping the planet?" In another decade we'll have the "emerging markets/countries" with much higher per capita carbon emissions, and then what..? The reality is that the US is not its own planet. The stupidity NEVER ceases to amaze me..OK, let's take this further. Let's say (obviously not reality YET), that we take the lead, pay the price, and develop technology that drastically reduces our need for oil and coal. You don't see that as a competitive advantage? And as a major side benefit, we reduce greenhouse gas emissions. Can't buy into your bluster.
Sorry, but I see a "since no one else cares about the environment, I won't either" strategy as a game of chicken where everyone loses. BTW, WE are the biggest polluters on the planet per capita, so thinking that we reducing our gas output doesn't matter is illogical thinking. You can think what you want about "alleged" helping the planet, but find me someone with any credibility (wingnut radio guys aside) that says it literally doesn't matter how much we pump out, and I'll listen to you. Nobody knows for sure how much we need to reduce gas emissions, but it certainly isn't a negative to do so. And, even if you don't care about the environment, economically, it is smart as well. There is a limited amount of Fossil fuels, and the price for them, IF no good alternatives come about, are going to grow astronomically as supplies dwindle. To twiddle our thumbs until that time, and then go,"WOW! Oil is $300 a barrel. I sure wish we had other alternatives" is much stupider than you claim this thinking is.
nycll said: EvilCapitalist said: He's skeptical on CO2 emitted by human activity being the cause of a global warming. The Figure 2 of this paper supports the link between temperature and CO2 level.
Causation vs. correlation.
Nowhere in the article says CO2 didn't increase nor the increase was not from human activities.
1. start lots of companies, they don't have to do anything. 2. sell carbon credits on market. 3. profit.
Dealguy123
Senior Member - 2K
posted: Jun. 30, 2009 @ 12:31p
geebeebee said: OK, let's take this further. Let's say (obviously not reality YET), that we take the lead, pay the price, and develop technology that drastically reduces our need for oil and coal. You don't see that as a competitive advantage?
Uh.. we are already doing this. Why we need a carbon cap or whatever is what I don't understand. The other problem is that folks don't want to make the (necessary) sacrifices and look to other forms of energy (like nuclear), because they're scared of a meltdown and the "pollution," and whatever other nonsense. Another thing to keep in mind is that coal is something we have a lot of in this country. It's one of our competitive advantages, and using it until we get onto other technologies is fine by me.
Sorry, but I see a "since no one else cares about the environment, I won't either" strategy as a game of chicken where everyone loses.
I was waiting for someone to tear that straw man to shreds. Bravo, you didn't disappoint. Just because we aren't enforcing carbon taxes/etc. doesn't mean we don't care.
BTW, WE are the biggest polluters on the planet per capita, so thinking that we reducing our gas output doesn't matter is illogical thinking.
That's not what I said at all. I suggest you re-read what I said, and come back to me with a logical response. That's straw man #2.
You can think what you want about "alleged" helping the planet, but find me someone with any credibility (wingnut radio guys aside) that says it literally doesn't matter how much we pump out, and I'll listen to you. Nobody knows for sure how much we need to reduce gas emissions, but it certainly isn't a negative to do so. And, even if you don't care about the environment, economically, it is smart as well.
I agree, and never said otherwise. The point however, is that by doing this, we're hurting ourselves, for no good reason (this cap and trade crap will not substantially reduce emissions, that's the reality). I probably live more "green" than 98% of the people in this country, which isn't readily apparent on a message board, but that's the reality. I'm all for reducing emissions/etc, but to a "reasonable" level. Of course, everyone defines "reasonable" differently.
There is a limited amount of Fossil fuels, and the price for them, IF no good alternatives come about, are going to grow astronomically as supplies dwindle. To twiddle our thumbs until that time, and then go,"WOW! Oil is $300 a barrel. I sure wish we had other alternatives" is much stupider than you claim this thinking is.
Uh... you don't seem to understand economics very well. I guess you're a peak oil believer where one day we'll just wake up and there'll be no oil and/or it'll cost $1k/barrel? lol I understand the peak oil argument very well, and fortunately we're making steady strides AWAY from oil, but it takes time (and again, there are the green nuts preventing other viable alternatives). There are alternatives available today, just people are too spoiled/selfish to make the change. Fortunately, the marketplace is ultimately self regulating, and high oil prices will push the alternatives. That's how it works. Again, I'm all for reducing our per capita carbon output in the US (I think most would agree most americans are terribly wasteful/etc), but this cap and trade nonsense is certainly not the answer. We need things to change from the bottom up (turning off lights/electronics, not "wasting" a lot of things, etc), not this ridiculous carbon cap. The point with my previous post is that if the carbon output won't be done here, it'll simply be done elsewhere, completely bypassing the point of this bill, and doing nothing but raising costs. It kind of reminds me of the bill going through congress about eliminating speculating on oil when prices were approaching $150/barrel. So what if it was made illegal here, you could still trade it everywhere else in the world, ultimately making the bill pointless. This is the same as the cap and trade bill, but common sense is not a strong suit of the "greenies."
So, you can certainly be "green" and against this bill. That's what some folks (like yourself), don't seem to comprehend. It's not a tree hugger vs. "I love my Hummer H1" bill.
duncan36
Senior Member
posted: Jun. 30, 2009 @ 12:43p
Again, I'm all for reducing our per capita carbon output in the US (I think most would agree most americans are terribly wasteful/etc), but this cap and trade nonsense is certainly not the answer. We need things to change from the bottom up (turning off lights/electronics, not "wasting" a lot of things, etc), not this ridiculous carbon cap.
You're all for reducing carbon output on an individual basis. But any program that forces rich industrialists to actually stop poisoning people, woah thats one step too far. I understand your position. I think its also been proven to be the wrong position. People for instance have built new giant, destructive, non-clean coal plants all over Texas. Why? Because they dont live near it, couldnt give a crap about who they poison or what effect they have on the environment. They only care about the bottom line. This obviously is an area where its proven the market has failed, and where the government has to step in and do something. No solution is perfect all have potential flaws but something has to be done.
chimeer
Cranky Member
posted: Jun. 30, 2009 @ 1:14p
geebeebee said: staci86 said: Demand drives price, and price drives demand. That is Econ 101. Of course, you threw in the word "automatically" to plant an insidious straw man escape.If technology changes the game, all that is out the window. If suddenly solar/wind/whatever power is the equivalent of $1/barrel of oil, then $5 oil is not attractive. Maybe that is Econ 102.
It's funny you used a Thomas Edison example. How do you think the oil lantern market did after he invented the light bulb and mass-produced it? Are China and India taking undue advantage of us because of their use of oil lanterns?
This type of thinking is why we are probably 30 years behind where we should be by now. Alternative energies have been around for decades, but the greed and lack of foresight has kept us back from where we should be.
Yes, but the technology isn't viable at this point, otherwise we would be seeing a dramatic shift from Fossil fuels to renewable energy sources and that just isn't happening. A more effective way for the government to try and push things along would be to provide tax incentives for using viable alternatives and or grants for researching alternatives. As it is Cap and Trade will cost many jobs that we can't afford to loose and will do nothing to fight global warming.
Skipping 248 Messages...
h2sammo
Frivolous Member
posted: Jul. 22, 2009 @ 4:47p
this legislation spells genocide for the poorest of the poor in the poorest of the worlds. its a tax like any other. medicare, social security...why not a tax on pollution.
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