TT's Lost in Tokyo — by TokyoTom

[Update: Readers may wish to note the latest developments, as I note in these follow-up posts.]

Stephan Kinsella – whom I have engaged before on the ramifications of the decidedly non-libertarian state grant of limited liabiility to corporations – has a new post up on the Mises Blog on global warming;  his first on this subject, as far as I know.

The post is surprisingly short, and consists of a simple introduction by Stephan a copy of letter to the EPA (which he has appended) that one Howard Hayden, a retired physicist, one whom Stephan assures us is “a staunch advocate of sound energy policy” – whatever that means (hey, me too!) – submitted in connection with the EPA`s Supreme Court-mandated consideration of whether to regulate CO2 and other greenhouse gases. Stephan also refers to Dr. Hayden`s letter as a “one-letter disproof of global warming claims.”

I welcome Stephan to this discussion, which has taken place at the Mises Blog in fits and starts over the past few years. However, the absence of any commentary by Stephan leaves me scratching my head. Where`s the beef? Are this person`s scientific views on climate so convincing or obviously correct, and are the policy implication so straightforward, and correct, that we should all “get it” and agree, without any commentary by Stephan? Or Is Stephan simply playing with our credulity, and his own?

In any case, given both (1) the focus of Austrian economics on productively addressing conflicts between people with conflicting preferences (and the frequently negative role that governments play in resource tussles, generally to the benefit of entrenched insiders and to government itself) and (2) the recent Nobel prize award to Elinor Ostrom regarding the ways that humans work together successfully or not) to address common resources, I am simply disappointed. Is this all that Stephan has to offer?

Observing that Stephan fits within a grand tradition at Mises of shallow thought on climate and other “environmental” issues, I felt compelled to post a few thoughts at Stephan`s post, which I copy below:

Stephan:

Thanks for bringing your post to my attention.

My short response? Remember “Thank you, Prof. Block, for feeding our confirmation biases“?

But since I can`t resist doing what nobody else seems inclined to – I suppose it is, after all, why you invited me to this feast – let me make a few comments on matters that would apparently not otherwise occur to you or to the rest of the community.

The fact that most of the contents of Dr. Hayden`s letter is confused twaddle that has been explained in detail countless times (and personally by me, ad nauseum, to the extreme annoyance of most of the blog over the years 2006-2008) aside, it puzzles me that you and others prefer to treat the pages of the Mises Blog as a forum to dismiss – through drive-by postings like this (a la Walter Block) of a particular piece of “skepticism” that caught your fancy – extremely widespread scientific views (held by EVERY major national academy of science, including China and India), rather than engaging in a discussion of preferences, institutions and policies.

As I`ve asked Jeffrey Tucker previously, is science the forte of the Mises Blog, or its readers?

Even if those who believe that man`s rising emissions of CO2 have nothing to do with an observably rapidly changing world and pose no threat whatsoever – and that those who disagree are all deluded and/or evil – turn out, after we play our little massive and irreversible game with the Earth for another few centuries, to be absolutely right, is engaging with them by dismissing their concerns an approach that holds even the slightest prospect of success?

It`s as if Austrians were determined to ignore their own principles, stampede themselves into irrelevancy, and to make sure that we get the WORST policy outcomes possible.

Why not, if you think others all wrong, deluded or evil, play along with their game, and actually seek policy changes that might not only address the expressed concerns of others in a meaningful way, while also advancing a libertarian, freedom-seeking agenda?

As I have noted in a litany of posts at my blog, most recently one addressed to Bob Murphy, such pro-freedom regulatory changes might include:

• accelerating cleaner power investments by eliminating corporate income taxes or allowing immediate amortization of capital investment,
• eliminating antitrust immunity for public utility monopolies (to allow consumer choice, peak pricing and “smart metering” that will rapidly push efficiency gains),
• ending Clean Air Act handouts to the worst utilities (or otherwise unwinding burdensome regulations and moving to lighter and more common-law dependent approaches),
• ending energy subsidies generally (including federal liability caps for nuclear power (and allowing states to license),
• speeding economic growth and adaptation in the poorer countries most threatened by climate change by rolling back domestic agricultural corporate welfare programs (ethanol and sugar), and
• if there is to be any type of carbon pricing at all, insisting that it is a per capita, fully-rebated carbon tax (puts the revenues in the hands of those with the best claim to it, eliminates regressive impact and price volatility, least new bureaucracy, most transparent, and least susceptible to pork).

Other policy changes could also be put on the table, such as an insistence that government resource management be improved by requiring that half of all royalties be rebated to citizens (with a slice to the administering agency).

As Rob Bradley once reluctantly acknowledged to me (in the halcyon days before he banned me from the “free-market” Master Resource blog), “a free-market approach is not about “do nothing” but implementing a whole new energy approach to remove myriad regulation and subsidies that have built up over a century or more.” But unfortunately the wheels of this principled concern have never hit the ground at MR [persistently pointing this out it, and questioning whether his blog was a front for fossil fuel interests, appears to be what earned me the boot].

There have been occasional   libertarian  climate  proposals floated over the past few years, but they have never graced the Mises Blog, instead falling gently to the ground unnoticed – apparently, except for me – like the proverbial unstrained koala tea of Mercy.

Austrians seem to act as if the love of reason requires a surrender of it in favor of the comforting distraction of a self-satisfied echo chamber of a type that would warm the cockles of any like-minded religious “alarmist” cult.

Then of course, we have our own  home-grown libertarians who are happy to participate actively in the debate (with many excellent points, naturally), but carefully skirt for the purposes of maximum effectiveness (and felicitously, for their own consciences) the fact that their views are funded by the dirtiest class of rent-seekers. Plus we have a few who are happy to regurgitate for us “heroic” “grassroots” efforts that are transparent corporate PR ploys.

Finally, since no one else seems to be remotely interesting in scratching the surface of Dr. Hayden`s letter, here is what a little due diligence turns up:

– sure, the solubility of CO2 in water decreases as water warms, and increases as water cools. Some skeptics use this to suggest that rising atmospheric CO2 concentrations are due not to man, but to a naturally warming. That`s why it`s so interesting that, despite a warming ocean, ocean pH is rising [oops, I meant pH is “falling”, as I`ve noted in a previous comment about rapidly changing ocean pH]  because dissolved CO2 is also rising (because man`s CO2 emissions are forcing more CO2 to be dissolved in water).

– You ask sarcastically, if the melting point of ice is 0 ºC in Antarctica, just as it is everywhere else, how will a putative few degrees of warming melt all the ice and inundate Florida, as is claimed by the warming alarmists? The answer is, simply, that (1) the warming oceans melt and undermine the coastal ice, and (2) as coastal buttresses are removed, gravity brings the continental ice down more rapidly. This process is well underway and apparently accelerating, as described in a study just published in Nature. Note also that not all of Antarctica lies precisely at the South Pole, and that some parts are melting directly as the atmosphere warms.

– finally, not all men are dinosaurs, nor is the rest of extant Creation (save birds, of course). Why should we feel comforted by the fact that we may, in the blink of an eye in geologic time (decades/centuries), be terra-forming the Earth for creatures that no longer exist, while stressing it for the rest of Creation? Do we have no right of preference in climate or in the life we share the Earth with, or have the investors in fossil fuel firms homesteaded the right to modify environmental matters willy nilly, come what may?

Thanks for providing the soapbox, Stephan.

Tom

I note that Stephan closes his introduction to Dr. Hayden`s letter with the following:

“I love Hayden’s email sign-off, “People will do anything to save the world … except take a course in science.””

Would that problems of governance of shared resources were so easy as taking a science course! Then ALL of us Austrians, and not merely our leading lights at the Mises Blog, could simply pack up and go home, and leave everything to a few philosopher-king scientists!

[Update: I copy at bottom a follow-up exchange I had on Bob`s thread with another reader – radio silence from Bob.]

Bob Murphy has a new post up at his blog, “CBO Testimony Misleads on Cost of Cap-and-Trade“, that draws attention to a new blog post at the Institute of Energy Research that Bob says he “had a lot to do with”.

The IER post rightly criticizes some of the numbers that the Congressional Budget Office has released, but the IER is playing games itself.

I left the following note at Bob`s (now substantially goosed up for the benefit of readers):

TokyoTom said…

IER? Isn`t that the “free-market” blog that bans libertarians who are not on their pro-coal, pro-pollution wagon? [Oops, I confused this with Rob Bradley`s MasterResource blog; IER is different, in that IER is – much more clearly than MR – an active rent-seeking front for fossil fuel interests, which Exxon made clear last year when it publicly announced that it would no longer fund IER`s “unproductive”, climate-skeptic position.]

But while we`re on the subject, let`s not forget:

– Austrians` fundamental objections to cost-benefit analysis;

–
that the mining, transport and combustion of coal, in addition to whatever climate “cost” it
might have to various people whose preferences can`t be measured, have
very real and significant costs in terms of damage to persons and property;

–
that federal law authorizes this (via the “Clean Air Act”, surface mining laws and ownership of the TVA), and grandfathers the very worst
midwestern utilities, the oldest 10% of which (41 or so) are  estimated to be responsible for 43% of the
$62 billion in annual  damages (not including damages from harm to ecosystems, effects of some air pollutants such as mercury, or climate change)(according
to the latest NAS report on the indirect costs of fossil fuels);

– that our federal government and states own most of the coal deposits and are otherwise addicted to the royalty revenues and complicit in turning a blind eye to damages;

– the future “costs” that the IER analysis refers to (in 2050) are not discounted to present value;

–
that alternative policies – such as

• a rebated carbon tax,
• accelerating cleaner power investments by eliminating corporate income taxes or allowing immediate
  amortization of capital investment,
• eliminating antitrust immunity for
  public utility monopolies (to allow consumer choice, peak pricing and “smart metering” that will rapidly push efficiency gains),
• ending Clean Air Act handouts to the dirtiest
  utilities (or otherwise unwinding burdensome regulations and moving to lighter and more common-law dependent approaches),
• ending energy subsidies generally (including federal liability caps for nuclear power (and allowing states to license), and
• speeding economic growth and adaptation in the poorer countries most threatened by climate change by rolling back domestic agricultural corporate welfare programs,

are never advanced, much less their costs weighed [that is, no attempt is ever made to engage opponents in good faith or to seek mutual gains by working to resolve underlying problems];

– the costs/consequences/risks and equities of “do-nothing” policies are hardly considered, and when so are heavily discounted;

– that deliberate “geo-engineering” holds no promise as a panacea, and itself is fraught with issues about statism, preferences, risks and liaibility;

–
the need for investment in infrastructure and change in laws to adapt
(and foster adaptation) to very real ongoing climate changes are never
discussed; and

– no one at IER ever seems to question the
unstated presumption that utilities and our transportation industries
have somehow homesteaded an ownership right over the global atmosphere – or the massive role that our federal government and states play as coal and other energy resource owners),
so that it`s perfectly okay to dismiss the preferences of those who
have concerns at home [those “religious” nuts like Exxon, and our Academies of Science] and those abroad in the least developed countries
that are most vulnerable to damages (much less to suggest how those
injured should be aided).

In other words, those defending the
status quo seem to have abandoned any Austrian training (or to have no
familiarity with its concern for problem-solving and awareness that
[as Block points out] common law protection of private property rights was hijacked a century
ago, with massive pollution and rent-seeking problems being the result).

Someone
ought to post a few of these thoughts over at IER; Rob Bradley somehow
finds comments of this type over fundamental principles to be “ad hominem” arguments [of the kind that very quickly tested his patience and got me banned, without any word to his co-bloggers, who found my comments worthy of considered response].

Sure, we should fight over policy, but let`s not ignore principles or put our heads in the sand.

October 28, 2009 10:10 AM

*  From the NAS report:

Coal accounts for about half the electricity produced in the U.S.  In
2005 the total annual external damages from sulfur dioxide, nitrogen
oxides, and particulate matter created by burning coal at 406
coal-fired power plants, which produce 95 percent of the nation’s
coal-generated electricity, were about $62 billion; these nonclimate
damages average about 3.2 cents for every kilowatt-hour (kwh) of energy
produced.  A relatively small number of plants — 10 percent of the total number — accounted for 43 percent of the damages.  By 2030, nonclimate damages are estimated to fall to 1.7 cents per kwh.

[update:

Supporters of cap and trade always turn to the
argument that opponents are burying their heads in the sand. It’s not
true. This legislation won’t do anything to help the environment. It is
merely a front so that the administration and the Democrats can say
they did “something.” We don’t need legislation that is going to cost
every single American household and won’t even be able to achieve its
stated goals. Write your Congressmen at
http://dontcapandtradeourjobs.net/?tr15.

[A], you`re missing my higher -level poinht, which is that IER is
rather apparently UNINTERESTED in engaging productively or on a
principled basis on this issue; rather, they are simply sniping (though
they make excellent points) at the cap-and-traders).

Though,
of course, from the view of those financing them, this form of
engagement may very well be “productive”, if it delays any action that
will lower returns to coal, rail or utility investors.

What`s
regrettable is that this obfuscation, which has been going on for
decades, is what is likely to saddle us with extremely costly, porky
and ineffective “climate change” policies.

# posted by  TokyoTom : October 29, 2009 12:08 AM

Michael Giberson at Knowledge Problem points to recent press coverage of the profoundly negative and perverse role being played by public utilities and their regulators.

Who knows, but isn`t there an opportunity here for market liberals and environmentalists to push for deregulation and greater competition in retail power markets, spearheaded by the federal government, and to have a deregulatory effort included in the climate bill?

Says Giberson: (emphasis in original)

The New Republic has an excellent article by Bradford Plumer about the current state of the electric power industry and the prospects of the industry achieving what diverse interests expect of it. (Yes, in TNR, who’d a thunk it?)
The article highlights the political economy of regulated electric
utilities and their immense lobbying savvy and political sway, and how
the existing regulatory framework acts to perpetuate the status quo.

The article leads off with an anecdote about Tom Casten
wishing to develop a combined heat and power (CHP) plant for a chemical
plant in Louisiana in the early 2000s – you know, one of those
win-win-win projects that recycle waste heat to make electric power,
reduce air emissions, reduce costs to the industrial company host, and
still makes a profit for the CHP company. The proposed project
never got off the ground due to the lack of support from the local
utility, and that lack of support was attributed to a regulatory
structure which rewards utilities for owning power plants rather than
minimizing the cost of power to consumers.

The article goes on to tell more stories, and delves into issues
like renewable portfolio standards, distributed power, smart grid
visions, and how a mostly-regulated industry is going to do tackle all
of these changes while not upsetting existing political deals and
getting paid a fair rate of return.

Giberson further reports on another story:

A story posted Tuesday at the New York Times‘ Green Inc. blog provides another example: “Discord Over Regulation of Car Charging.”
The story reports that the three major regulated electric utilities in
California each advocate different models for the regulation (or not)
of electric car charging stations by the California Public Utilities
Commission. Entrepreneurial companies like Better Place, trying
desperately to provide the electric vehicles that many consumers,
environmentalists, and policymakers say the country desperately needs,
find themselves caught in a regulatory battle.

To my disappointment, it turns out that Joe Romm, who  maintains the Center for American Progress` Climate Progress blog, didn`t let through my prior comment about how our discussions about green/efficiency mandates ignore the 800 lb. gorilla in the room, namely, inefficiency stemming from the lack of competition in consumer electricity markets.

But I`m not so easily discouraged; on the heels of Google`s roll-out of software and a monitoring device specifically to enable consumers to more efficiently use electricity, I tried again (toned down so he would not have to see how guys like Steven Milloy mirror him).  Here`s the comment I submitted:

Joe, on the issuie of mandates, both you and Henderson fail to consider WHY our power system isn`t MUCH more efficient and doesn`t provide greater consumer choice – namely, grants by local governments of power monopolies and related regulatory balkanization.

Let`s not forget that the “ethical” argument for interfering with the market for electrical products is based on the fact that local governments have prevented competition in local markets for power generation and distribution.

That there are huge efficiency gains to be made in improving consumer electricity markets is precisely why Google is focussed on providing consumers with greater information about their electricity consumption.

Thus we see one of the continuing problems presented by the fight for control over the wheel of government: those who want to steer it their way are so sure they`re right – and convinced that the others are stupid or evil – that they can`t be bothered to try to notice or try to achieve shared objectives.

On the heels of my post about Apple leaving the U.S. Chamber of Commerce, here are a few more links and excerpts for eager readers (who have been spared a longer post that vanished into the ether as pixie dust crashed Mozilla and my prior unsaved draft) (emphasis added).

1.  The Chamber’s opaque policy-making mechanism on climate, and the trigger for the wave of departures from the U.S. Chamber of Commerce;

see long article at NYT:

U.S. Chamber of Commerce staff decides the trade group’s climate and
energy policy positions without approval from the board of directors,
Nike Inc. charged as it formulated a plan to call for greater chamber
openness.

Nike, which last week left the chamber’s board of directors but decided
to remain a chamber member, described a lack of transparency at the
group that conflicts with how the chamber describes its operations. …

“We just weren’t clear in how decisions on climate and energy were
being made,” said Brad Figel, Nike’s director of government relations.
“They’re not being made at the board-of-director level, because we’re a
member of the board of directors. We were not consulted. We’re
convinced that’s not really where the action on climate change is being
made.”

The chamber reaches its positions through a “democratic
process” that is “driven by members,” chamber spokesman Eric
Wohlschlegel said yesterday. …

“Policy is developed and recommendations are made to the whole
board,” spokesman Wohlschlegel said yesterday. “It’s an open and
voluntary process, and it’s formulated by a majority of our members
that represents the broader business community’s perspective and not just the interests of one sector, one energy sector … or one sector of the economy.”

He
would not address Nike’s statement, however, that while it had
representation on the board of directors, the board did not vote on
climate policy positions. Wohlschlegel would not say when the board
last took a vote on its position on climate legislation. …

“They told us these decisions were made by staff [and not pursuant to the Board’s committee system],” Figel said. He
said that Nike was told that “this is a longstanding chamber policy,”
and that “once the policy is established, a lot of these decisions can
be made at the staff level.”

Last spring, Figel said, Nike told
the chamber that it wanted to be consulted on climate issues. After
that, he said, “there were several decisions that were made by the
chamber that we weren’t consulted on.”

In particular, Figel said, Nike recoiled at a chamber official’s
call for an EPA trial similar to the Scopes Monkey Trial on
evolutionary theory [regarding EPA’s steps to employ regulatory authority affirmed by a Supreme Court decision during the Bush administration].

“That’s not helpful in any way,” Figel said. “That put a lot of companies on edge, how they phrased that.”

The
statement this summer by William Kovacs, a chamber senior vice
president, that the science of global warming should face a public
trial similar to the Scopes Monkey Trial thrust the trade group into a
new realm, [Kenneth] Green [resident scholar at the American Enterprise Institute] said.

“That was beyond the pale in terms of
aggressiveness that I’ve seen in a trade association,” Green said. “At
that point, they were really inserting themselves into the political
process in an extremely visible way, not just a matter of lobbying for
their companies but really engaging in the bigger cultural argument. I
wouldn’t be surprised if that wasn’t what scared some people away.”

Note (from Marc Gunther at Salon in April):  ” Nike—along with Starbucks (SBUX), Levi Strauss, and Timberland
(TBL)—helped form a green-business coalition to lobby for strong
federal actions on climate. The coalition is called BICEP: Business for
Innovative Climate and Energy Policy.”

From blog of Marc Gunther (who is a Fortune contributing editor):

To be sure, the chamber, which calls itself “the voice of business”
and spent about $62 million lobbying Congress last year, also has lots
of members from the oil, coal and energy-intensive industries who
oppose federal regulation of greenhouse gases. Its 122-member board
includes executives from Consol Energy, Massey Energy, Peabody Energy,
and the Southern Co.

The smart thing for the chamber to do would be to stay neutral—to
admit that business is divided on the issue and to leave lobbying up to
individual companies. Instead, some chamber officials offered up
reasonable arguments against the bills pending in Congress and others
went off the deep end. In a remark that was ill-advised at best and
downright dumb at worst, William Kovacs, the chamber’s senior vice
president for environment, technology and regulatory affairs, called
for a public trial about climate science that he said would be “the Scopes monkey trial of the 21st century.”

2.  Who dissents from the Chamber’s long-standing opposition to climate change legislation? (with links to statements)

Quit the Chamber: Exelon, PNM Resources, PG&E, Apple.

Quit the Chamber’s Board: Nike.

Says Chamber doesn’t represent their views on climate:

– seven Board members from companies that are part of the U.S. Climate Action Partnership, a wide business coalition pushing for passage of climate
legislation: Alcoa, Caterpillar,
ConocoPhillips, Dow Chemical, Duke Energy, Siemens and Xerox

– General Electric, General Motors, Ford, Shell, DuPont, American Electric Power, and John Deere also support mandatory controls on greenhouse gas emissions.

– ExxonMobil favors a carbon tax (as I have noted several times).

– Entergy, a New Orleans-based utility also on the board

– General Electric,

– Johnson & Johnson,

– San Jose Chamber of Commerce.

Note: Those expressly in favor of the Chamber’s go slow approach on climate appear to be limited to coal firms Peabody Energy, Massey Energy Corp.,
and CONSOL Energy, and freight shipper Con-Way Inc.  As noted previously, Chamber CEO Tom Donohue is closely tied to coal shipper Union Pacific.

3.  In a move that shows how little the Chamber cares about the opinion and positions of its dissenting members, CEO Tom Donohue took at jab at Apple in this October 6 letter that he addressed to Apple CEO Steve Jobs in response to Apple’s announced resignation from the Chamber (with editorial comments):

Dear Mr. Jobs:

“I
am sorry to learn of Apple’s resignation from the U.S. Chamber of
Commerce. It is unfortunate that your company didn’t take the time to
understand the Chamber’s position on climate and forfeited the
opportunity to advance a 21st century approach to climate change. [Needless, to say, Apple quit because it fully understood and was fed up with the Chamber’s actual position – unrelenting intransigence; PG&E said in its letter to the Chamber announcing its withdrawal: “Extreme rhetoric and obstructionist tactics seem to increasingly mark
the Chamber’s public stance on this issue.“]

“The
U.S. Chamber of Commerce continues to support strong federal
legislation and a binding international agreement to reduce carbon
emissions and address climate change. [The Chamber has no consistent expressed approach; it has opposed all federal legislation, and opposes provisions that would penalize foreign countries not adopting similar legislation. It is simply trying to put lipstick on a pig.] Furthermore, we believe that
Congress should set climate change policy through legislation, rather
than having the EPA apply existing environmental statutes that were not
created to regulate greenhouse gas emissions. This is also the stated
position of the President and Congressional leaders. [The regulatory threat exists only because the Bush administration and Republican Congress refused to act, and because the Chamber has exercised no leadership in outlining constructive legislation.]

“Your
letter states that “Apple is committed to the environment and the
communities in which we operate around the world.” So is the Chamber
but we are also committed to preserving the competitiveness and
prosperity of the communities and businesses in our nation. [Particularly the competitiveness and prosperity of the Chamber members that mine, transport and burn coal.]

“While
we do support legislation to address climate change [the Chamber continues to take the position that even an average 3 degrees C increase over the next century would bring net benefits], we oppose
legislation such as the Waxman-Markey bill that numerous studies show
will cause Americans to lose their jobs and shift greenhouse gas
emissions overseas, negating potential climate benefits. An effective
climate change response must include all major CO2 emitting economies,
promote new technologies, emphasize efficiency, ensure affordable
energy for families and businesses, and defend American jobs while
returning our economy to prosperity.

“The American business
community that we proudly represent is the single largest investor and
innovator in clean energy solutions and remains committed to a strong
economy and clean environment. … The Chamber believes that the
business community will continue to be the catalyst for reducing
greenhouse gas emissions and we support efforts to tackle climate
change in a way that will strengthen our economy, protect American
jobs, and benefit our environment.

“Climate change is a global
problem that requires a global solution. The Chamber supports an
international agreement that will set realistic and achievable goals,
ensure global participation, protect intellectual property rights and
remove trade barriers to environmental goods and services.

“I
would have hoped that Apple would have supported our efforts to improve
environmental stewardship and keep Americans at work and our economy
competitive. As the world’s largest business federation representing
more than 3 million businesses and organizations of every size, sector,
and region, the Chamber is leading the way to support the innovation
needed to transition to a lower carbon future, including the
elimination of barriers to the deployment of clean energy technologies.
Supporting innovation and technology is at the very heart of our
efforts to combat climate change, and we will continue to fight for an
approach that embraces their merits.

“It is a shame that Apple will not be part of our efforts.” [Yes; the Chamber will just have to “lead” with fewer followers, fewer resources, and less prestige. And it appears that Tom Donohue is trying to “lead” the way to even fewer Chamber members; Dale Carnegie’s “How to Win Friends and Influence People,” anyone? ]

4.  More ongoing insightful (if skewed) commentary on the Chamber of Commerce here by Peter Altman, “Climate Campaign Director” of the mainstream enviro group NRDC (which largely “depend[s] on the kindness of rich people to stay afloat.” Its board and
major donors “come from Wall Street, corporate law firms and big
companies.”

5.  It’s clear that we are looking not merely at a clash of preferences, but a clash of preferences over how government is used – and in whose favor. This would look like classic “rent-seeking”, but for the fact that it relates to the management of an un-owned, open-access commons that affects all of us – the atmosphere and climate system – and the fact that Coasean bargaining on an international scale cannot, in any practical sense, be conducted without involving states.

The intransigence of a core of coal interests, in the face of a rebellion by firms that support legislative action on climate change, is threatening the status of the US Chamber of Commerce as the premier business council in the US, as now Apple Computer has quit the US Chamber of Commerce.

Apple`s departure, announced  on October 5 and effective immediately, came on the heels of departures in the past two weeks by the utility companies Pacific Gas & Electric, PNM Resources and Exelon. In addition, Nike has quit the Chamber’s Board, and other members such as Johnson & Johnson have voiced strong opposition to the climate stance of the Chamber and asked that it not take public positions on this issue.

It`s not clear how closely the Chamber has polled all of its wide membership on climate issue, but it`s apparent that the Chamber`s rather hard-line stance is out of step with its Board members.  According to research by the NRDC (a mainline environmentalist group) in May:

the staff of the U.S. Chamber appears to be projecting the views
held by a tiny sliver of its board of directors – just four out of 122
members on the board.

The Chamber’s oft-stated views, which question the scientific
consensus on climate change and reject the need for federal regulation
to reduce global warming pollution, stand in sharp contrast to the
views expressed by 19 members of the Chamber’s board that support
federal regulations with goals to reduce total US global warming
pollution.  

You read that right: only 23 members of the U.S. Chamber’s board have a publicly stated position on climate change and more than 80 percent are not on board with the U.S. Chamber’s “Dr. No” position on climate policy action.

So who is in the minority that has shanghaied the U.S. Chamber of
Commerce on climate policy? Be prepared to be shocked!  Three of the
four climate are coal companies:  Peabody Energy, Massey Energy Corp.,
and CONSOL Energy.  (The fourth – Con-Way Inc. – is “a freight company and logistical services company.”)

As the WaPo noted, in response to prior defections,

Last week, the group’s president, Thomas J. Donohue, said in a
statement that his group supports “strong federal legislation” to
protect the climate. But he said legislation passed by the House of
Representatives — which would use a “cap and trade” system to lower
the cost of reducing emissions — was flawed because it does not
require other polluting countries to act and does too little to spur
U.S. investment in green technologies.

In response to Apple`s departure, a spokesman for the Chamber dissed the motives of the firms quitting the Chamber:

“While we’ll continue to represent the broad majority of our membership
on this goal, we recognize that there are some companies who stand to
gain more than others with the current options on the table.”

While this may be true for the utility companies, which are members of the USCAP organization and stand to gain free allocations of carbon allowances under the cap and trade bills under consideration, it is hardly so for Apple, Nike or Johnson & Johnson. And of course it distracts from the fact that the coal firms and their shippers – including Union Pacific, which richly compensates Union Pacific board member Tom Donohue, the President of the Chamber – benefit greatly from the status quo, to an extent and in a manner quite different from other Chamber members.

It will be interesting to see what will happen next at the Chamber of Commerce, and who will be next to leave.

Joe Romm of Climate Progress has a new post up that lambasts a recent WaPo op-ed by “environmental ethicist” David Henderson. Romm provides useful information on the relative efficacy of government technology forcing efforts, but comes down like a ton of bricks on Henderson, all while ignoring the 800 lb. gorilla in the room – consumer frustration over, and energy inefficiency resulting from, the lack of competition in local power markets.

In this, Romm mirrors anti-enviro Steven Milloy, who has been raking GE over the coals for its actions to support “green mandates” for subsidies that benefit GE by stimulating markets for GE`s energy-efficient smart meters and smart water heaters. 

I left the following note at Joe`s that draws attention to the parallels:

Joe, you marginalize yourself and do the debate a disservice by continuing to mirror partisans like Steven Milloy, who`s so busy demonizing those who want more green power and greater efficiency that he forgets to examine WHY our power system isn`t MUCH more efficient and doesn`t provide greater consumer choice – namely, grants by local governments of power monopolies and related regulatory balkanization

Let`s not forget that the environmentalists` “ethical” argument for interfering with the market for electrical products is [based on the fact] that local governments have prevented competition in local markets for power generation and distribution.

[To comment, please visit this post at my main blog at the Ludwig von Mises Institute.]

The coal- and utility-funded “free-market think tank” Institute of Energy Research has a just released another study that tells us the obvious about the regressive consequences of the Waxman-Markey cap-and-trade bill and the benefits likely to flow to its corporate supporters, while masking its own agenda. As an added benefit, the press release includes some one-sided and unsupportable over-statements by Bob Murphy.

A few points:

IER:  “cap-and-trade would precipitate a financial windfall for well-connected
special interests and politically-favored companies.”

me:  No dispute here. It`s perfectly fair to point out who will benefit from the cap-and-trade bills.  But let`s not ignore that coal investors have long benefitted from being able to shift pollution costs to people downstream, under the perverse “rights to pollute” enabled under the Clean Air Act, and under state and federal mining licenses that allow mining firms to force out local residents.

IER:  “The study … details how shareholders,
not ratepayers, will be the primary beneficiaries of cap-and-trade’s
largess.”

me:  Sure, just like how it was shareholders in coal producers and utilities who are the primary beneficiaries of the externalities permitted by the status quo.

Bob Murphy:  “[The] analysis … illustrates just how flawed and skewed this
legislation is toward rent-seeking special interests.“

me:  Sure, but the interest of the coal lobby is that the legislation doesn`t benefit them enough. Do coal investors care MORE about what`s good for the average Joe than do other “rent-seeking special interests”?

Bob Murphy:  “secondly, and more important, [the analysis] shows that cap-and-trade, as
outlined in Waxman-Markey, is nothing more than a transfer of wealth
from the poorest to the richest among us.“

me:  Oh really?  Does the analysis really conclude that Waxman-Markey does “nothing more” than transfer wealth? You mean Waxman-Markey wouldn`t actually raise prices of carbon-based energy or affect consumption and investment decisions by industry, businesses and consumers?

Bob Murphy:  “These new findings should send a clear message to the American people – cap-and-trade helps the powerful and hurts the rest of us.“

me: The message is fine and important. But are coal firms and investors “the rest of us”, not powerful and only concerned about the average Joe, or are they trying to protect their own privileged position? Further, are there any alternatives to cap-and-trade that coal investors support, such as carbon taxes, or even undoing their favored treatment under federal clean air laws and mining laws?

Bob Murphy:  And as Congress’ corporate allies receive the bulk of the benefits
Waxman-Markey has to offer, our environment, along with our struggling
economy, will suffer for years to come. Congress needs to get out of
the business of picking winners and losers and allow the market to
determine which energy and electricity sources should power our
economy.”

me: Ahh yes, forgive me; I forgot that coal firms were a part of the enviro lobby!  But aside from that, I agree strongly that Waxman-Markey is poor policy.  Do coal investors agree with Exxon that rebated carbon taxes would keep Congress “out of the business of picking winners and losers and allow the market to determine which energy and electricity sources should power our economy”?

Thanks, IER for showing us how “political capitalism” works!

* “Political capitalism” is Rob Bradley`s term for “rent-seeking”

Since I`m in Tokyo and deprived of Bob Murphy`s enviable access, via talk radio, to cutting-edge climate science, I thank him using his blog to bring it to the attention of his audience (which occasionally includes me). Says Bob (emphasis added):

Chip Knappenberger explains
the significance (and remaining holes to be plugged) in the recent
Lindzen-Choi paper that’s got talk radio in such a tizzy. The opening
sentence: “MIT climate scientists Richard Lindzen and collaborator
Yong-Sang Choi soon-to-be published paper (Geophysical Research
Letters, American Geophysical Union) pegs the earth’s “climate
sensitivity”—the degree the earth’s temperature responds to various
forces of change—at a value that is about six times less than the “best
estimate” put forth by the Intergovernmental Panel on Climate Change
(IPCC).”

Well, well, if talk radio is covering a new article that purportedly downplays climate risks, then others who have invested time in casting doubt

I`ve blogged previously about my various conversations with Chip Knappenberger, who is employed by the self-described “advocacy” group of Pat Michaels, New Hope Environmental Services.

I went to pay a visit to his post at Rob Bradley`s pro-coal, “free market” MasterResource blog, which I have discussed on any number of occasions here – especially after Mr. Bradley unceremoniously withdrew the welcome mat for libertarian critics (yours truly) while in mid-conversation with (and without notice to) several of his guest bloggers.

I reviewed Chip`s precis of the Lindzen-Choi paper and attempted to leave comments at MasterResource, but they were “disappeared” as soon as they were posted, so I forwarded a copy of my comments by email directly to Chip, which I copy below (with minor edits):

Chip, I couldn`t resist trying to comment on your post at MR, and
checking to see if Rob still has his blog set up to automatically
exclude all of my comments. Unfortunately, he still seems to be
convinced that a principled and libertarian approach (or his clients`
needs) requires maintaining his echo chamber by excluding me.

To check the sophistication of his method, I have for the first time
just tried commenting anonymously (I have until stayed away and simply
hoped Rob would change his mind), and to my surprise the comment went
through – though it is “awaiting moderation”. [update: this post has now received immoderate , “echo chamber” moderation]

I thought I would give you a head`s up on my pending comment, which I
do not expect to see published – but who knows?  Strange things
sometimes happen, such as Rob quoting with approval a link to a
comment that I have made:
http://mises.org/Community/blogs/tokyotom/archive/2009/08/26/fun-with-partisanship-and-self-deception-the-climate-follies-and-rob-bradley.aspx.

My comment is below; I will wait until tomorrow before cross-posting
at my own blog.

Sincerely,

Tom

[comment left at MasterResource]
“It is too early to tell whether Lindzen and Choi’s findings will
prove to be the end-all be-all in this debate.”

But it`s not too early for you, for others who act as paid mouthpieces
for fossil fuel and others who wish to avoid policy action, to trumpet
this as yet unpublished paper all over the intertubes, is it Chip?

By the way, continuing studies on the “sensitivity” of temperatures to
GHG increases should not lead us to ignore either the problem of ocean
acidification from our accelerating CO2 build-up or the very exquisite
sensitivity of the Earth`s climate and ecosystems to the 0.6 C average
temp increase that we have experience over the past 50 years
(remaining stuck at a peak for the past 10).  The Arctic and temperate
zone glaciers continue to rapidly thaw, and other changes affecting
ecosystems and human livelihoods are still underway.

I note I have seen very preliminary remarks by James
Annan here, and by

I note that Bob Murphy is no climate expert, but simply posting blindly about something that he thinks cuts in the direct he wants; in a similar vein, Knappenberger also evidently is puffing the importance of a scientific article that is hot off the presses, but can`t be troubled to link to any articles providing additional context. (A recent blog post and comments by Steve McIntyre at Climate Audit also point out the difficulties in reaching conclusions from the new research.)

I also note, as I have previously, that not only Chip but Bob as well – when he has on his “economist for IER” (which is a coal and public utility front group that was de-funded last year by Exxon) hat – are, at least in part, being compensated to undercut climate change policy.

In this context, we all are prone to note evidence that fits into our existing world view, while discounting contrary information, such “confirmation bias” is readily apparent in the internet and radio coverage of this piece.  While climate change and climate policy are certainly hot topics, it doesn`t seem to me that the so-called “skeptics” are at all taking this new study skeptically, but are instead eagerly lapping it up, assume it is good news, are are loudly trumpeting it. Now who`s fooling whom?  Many “skeptics” look just like the “alarmist” “global warming cult” “believers” whom they abhor.

Unfortunately, while it`s impossible to know what Rob and Chip are actually thinking and why, it`s clear that a dangerous mix of self-deception, confirmation bias and rent-seeking permeates the tribal conflicts that we are seeing in current over the use of government, not the least in the case of climate change, which is a difficult scientific and policy issue.

For the benefit of the curious and/or idle reader, I`m cross-posting from my little-used personal blog a short post on the above topic and the ensuing conversation.

(I note that my inaugural post at this LvMI-hosted blog covered a related topic:   “Too Many or Too Few People? Does the market provide an answer?“.)

Wednesday, April 01, 2009

Planet’s First-Ever Mass-Extinction Precipitated by Humans

TokyoTom said…