http://online.wsj.com/article_email/SB10001424052748704541004574599981936018834-lMyQjAxMDA5MDEwNjExNDYyWj.html
As Santa gets his sleigh ready for his worldwide efforts this week, we want to wish our regular readers the happiest of holiday seasons! For those who celebrate as we do: Merry Christmas and Happy New Year!
Looking down at Earth from Santa's galactic perspective, Howard Bloom helps with a little Earth history in order to bring us some current perspective on what is and is not relevant about the two week meeting that just took place in Copenhagen. Of course, the short answer is that there is "nothing" relevant that took place in Copenhagen but we know those involved were sincere people so we'll be sincere too.
And, we'll set aside what we thought we heard was $100 billion offered by a representative of the U.S. (could that have been Hillary Clinton - perhaps she was confused about the asking price of her next book deal, but I digress) as good faith money for developed countries to offer developing countries to help move their climate efforts forward. It would appear that throwing money at the problem is seen as a way of showing sincerity.
Bloom's perspective is that we've been the beneficiaries of a stroke of luck: "In the over two million years during which we climbed from stone-tool wielding Homo erectus with sloping brows to high-foreheaded Homo urbanis ... we underwent 60 glaciations, 60 ice ages. And in the 120,000 years since we emerged in our current physiological shape as Homo sapiens, we've lived through 20 sudden global warmings. In most of those, temperatures have shot up by as much as 18 degrees within a mere 20 years."
All this took place without Al Gore.
Bloom defines our "stroke of luck" as the sheets of ice we lived with "peeling back some 12,000 years ago" leaving today's planet. But, this "weather standstill", as Bloom refers to it, has held on for an "abnormally long amount of time."
So, as our planet "wobbles" thru its solar system orbit, it produces weather alterations we cycle thru every 22,000, 41,000, and 100,000 years. This is called the Millankovich cycle, named for the Serbian engineer and geophysicist who discovered it.
In addition, the sun is going thru a cycle: as a result of maturing, the sun is 43% warmer today than it was when the Earth was first formed 4.5 billion years ago.
Bottom line: "Weather changes and the occasional meteor have tossed this planet through roughly 142 mass extinctions since life began 3.85 billion years ago. That's an average of one mass extinction every 26.5 million years. Where did these die-offs come from? Nature. There were no human capitalists, industrialists or cultures of consumerism to blame."
As Bloom says, we don't want to be the victims of one of these "extinctions", but we do need to prepare for more than just the changes "we" think we make. Bloom calls it preparing for "fire and ice." The big stuff is not caused by your neighbor's SUV.
The next time our global temperatures go up 18 degrees in 20 years, it won't be because we didn't convert to electric cars fast enough ...
Happy Holidays!
Monday, December 21, 2009
Friday, December 18, 2009
Health Care
http://www.nytimes.com/2009/12/18/opinion/18krugman.html?emc=eta1
Once again, we find ourselves in good company with Paul Krugman whose post today, entitled "Pass the Bill", is completely in line with our thoughts!
As we have said in other prior posts, the current Senate bill would do two things: first, it would prohibit discrimination by insurance companies on the basis of medical condition or history (no denial of health insurance based on a pre-existing condition), and second, your insurance can't get canceled because you got sick, or you got too sick. Krugman includes the second as part of the first but we feel it deserves an appropriate spotlight. Krugman designates the second most important thing (and our "third") as the bill would provide substantial financial aid to those who don't get insurance through their employers, as well as tax breaks for small employers who do provide insurance.
We don't care what else is in the bill because, pragmatically, we know that some senators need some things in order to make it a "win" for them.
All of this would be paid for in large part by the first serious effort to rein in rising health care costs.
The result would be, as Krugman says, "... a huge increase in the availability and affordability of health insurance, WITH MORE THAN 30 MILLION Americans gaining coverage, and premiums for lower-income and lower-middle-income Americans falling dramatically."
Because he has studied this issue, Krugman assures that the history of social insurance programs is that the coverage gets better and more comprehensive as the years go by. While we hoped for that, it is nice to see someone of Krugman's stature reassures us.
While nobody will be completely happy with what's on the table, isn't that how politics (or labor negotiations) works? We like Krugman's quote, "... rejecting an imperfect deal in the hope of eventually getting something better is a recipe for getting nothing at all."
So, let's pass the bill and take note of those senators who sought to block it. Those senators should be easy to run against!
Once again, we find ourselves in good company with Paul Krugman whose post today, entitled "Pass the Bill", is completely in line with our thoughts!
As we have said in other prior posts, the current Senate bill would do two things: first, it would prohibit discrimination by insurance companies on the basis of medical condition or history (no denial of health insurance based on a pre-existing condition), and second, your insurance can't get canceled because you got sick, or you got too sick. Krugman includes the second as part of the first but we feel it deserves an appropriate spotlight. Krugman designates the second most important thing (and our "third") as the bill would provide substantial financial aid to those who don't get insurance through their employers, as well as tax breaks for small employers who do provide insurance.
We don't care what else is in the bill because, pragmatically, we know that some senators need some things in order to make it a "win" for them.
All of this would be paid for in large part by the first serious effort to rein in rising health care costs.
The result would be, as Krugman says, "... a huge increase in the availability and affordability of health insurance, WITH MORE THAN 30 MILLION Americans gaining coverage, and premiums for lower-income and lower-middle-income Americans falling dramatically."
Because he has studied this issue, Krugman assures that the history of social insurance programs is that the coverage gets better and more comprehensive as the years go by. While we hoped for that, it is nice to see someone of Krugman's stature reassures us.
While nobody will be completely happy with what's on the table, isn't that how politics (or labor negotiations) works? We like Krugman's quote, "... rejecting an imperfect deal in the hope of eventually getting something better is a recipe for getting nothing at all."
So, let's pass the bill and take note of those senators who sought to block it. Those senators should be easy to run against!
Tuesday, December 15, 2009
Copenhagen Results
http://online.wsj.com/article_email/SB10001424052748704517504574589952331068322-lMyQjAxMDA5MDEwNTExNDUyWj.html
We haven't posted on "Climategate" or the "Copenhagen Collapse" in at least two weeks so we feel remiss. Today we received a very nice note from someone and they reminded me about what's not going on over there. By "over there", we mean the world climate conference taking place over this two week period in Copenhagen (the conference is now in its second week). Coincidentally, we heard an interview with Bjorn Lomborg (who is at the conference) on National Public Radio this morning. Lomborg is the "enemy" of the global warming police. He is also the Director of the Copenhagen Consensus Center, a think tank, and author of "Cool It: The Skeptical Environmentalists Guide to Global Warming" (Knopf, 2007). Among other things, Lomborg had the novel idea last year of putting together several Nobel Prize winning economists and other experts to prioritize what should be done to "fix" the earth. His approach: we give you $10 billion, $50 billion, $75 billion - what is the most important thing to do for the 6.7 billion (plus or minus) people who live on the planet today? And, his group came up with a ranking of those things.
Where did "global warming" come in on the list? Roughly, 30th. Why? There's a simple answer and a way for the climate fanatics to coexist with more rational souls. Continued economic growth will keep people, and especially children, from starving. Stealing money meant for that in order to move carbon capture up the list of important things to do, will increase starvation and disease. Lomborg has a creative and relevant recommendation: radically increase spending on R&D for green energy - to 0.2% of global GDP, or $100 billion. That's 50 times more than the world spends now - but still twice as cheap as anything being considered now by the carbon posse. Wait, and, it would have a real chance of working! What a concept!
We have attached Lomborg's 12/14 "OPINION" post in the WSJ. Please refer to his calculations on, for example, the European countries' plan to divert $50 billion in development aid budgets to repackage them as climate-change assistance. Look at the trade off between what that buys in climate change and what the world loses in children that stand to starve "now" if that's done.
Today's NY Times had an editorial that indicated nothing was accomplished in the first week of Copenhagen. Nothing will be accomplished in the second week either because China and India have no interest in sacrificing economic growth because Al Gore has a "cause". Good for them!
We haven't posted on "Climategate" or the "Copenhagen Collapse" in at least two weeks so we feel remiss. Today we received a very nice note from someone and they reminded me about what's not going on over there. By "over there", we mean the world climate conference taking place over this two week period in Copenhagen (the conference is now in its second week). Coincidentally, we heard an interview with Bjorn Lomborg (who is at the conference) on National Public Radio this morning. Lomborg is the "enemy" of the global warming police. He is also the Director of the Copenhagen Consensus Center, a think tank, and author of "Cool It: The Skeptical Environmentalists Guide to Global Warming" (Knopf, 2007). Among other things, Lomborg had the novel idea last year of putting together several Nobel Prize winning economists and other experts to prioritize what should be done to "fix" the earth. His approach: we give you $10 billion, $50 billion, $75 billion - what is the most important thing to do for the 6.7 billion (plus or minus) people who live on the planet today? And, his group came up with a ranking of those things.
Where did "global warming" come in on the list? Roughly, 30th. Why? There's a simple answer and a way for the climate fanatics to coexist with more rational souls. Continued economic growth will keep people, and especially children, from starving. Stealing money meant for that in order to move carbon capture up the list of important things to do, will increase starvation and disease. Lomborg has a creative and relevant recommendation: radically increase spending on R&D for green energy - to 0.2% of global GDP, or $100 billion. That's 50 times more than the world spends now - but still twice as cheap as anything being considered now by the carbon posse. Wait, and, it would have a real chance of working! What a concept!
We have attached Lomborg's 12/14 "OPINION" post in the WSJ. Please refer to his calculations on, for example, the European countries' plan to divert $50 billion in development aid budgets to repackage them as climate-change assistance. Look at the trade off between what that buys in climate change and what the world loses in children that stand to starve "now" if that's done.
Today's NY Times had an editorial that indicated nothing was accomplished in the first week of Copenhagen. Nothing will be accomplished in the second week either because China and India have no interest in sacrificing economic growth because Al Gore has a "cause". Good for them!
Financial Regulation 2
http://online.wsj.com/article_email/SB126080843481590571-lMyQjAxMDI5NjEwNTgxMDU4Wj.html
http://roomfordebate.blogs.nytimes.com/2009/12/14/banks-real-reform-and-pitchforks/?emc=eta1
As a follow up to our most recent post, we want to add that the "Bank CEOs" yesterday pledged to push for re-regulation (WSJ attached) while they acknowledged to President Obama that their behavior was, at minimum, disingenuous and probably outright deceitful. How? The CEOs agreed that the work of their lobbyists to weaken any new financial rules was not consistent with their public support for new stronger regulations. This practice was made especially more onerous when one realizes that the lobbying involved was being paid for by the very same public that stood to be protected by the new regulations - so paying back TARP money was not just about freeing up executive pay, it was also about lobbying against the public interest with public money!
As many people have said throughout the worldwide financial crisis, any institution that is deemed "too big to fail" is: TOO BIG!
As Lawrence Summers said over the weekend, a $300 million banking industry lobbying push to "gut" financial market re-regulation is "frankly a bit rich."
Of course, the next question is how likely is the prospect of significant regulation of the banking industry from Washington? The House passed a banking regulation bill last week, and the Senate is working on its own version. The NY Times "Room for Debate" forum (attached) presents us with some opinions on the odds of significant regulation. See especially Edward Harrison who says we are unlikely to see substantive changes that will prevent another crisis in the financial arena. That sums it up.
http://roomfordebate.blogs.nytimes.com/2009/12/14/banks-real-reform-and-pitchforks/?emc=eta1
As a follow up to our most recent post, we want to add that the "Bank CEOs" yesterday pledged to push for re-regulation (WSJ attached) while they acknowledged to President Obama that their behavior was, at minimum, disingenuous and probably outright deceitful. How? The CEOs agreed that the work of their lobbyists to weaken any new financial rules was not consistent with their public support for new stronger regulations. This practice was made especially more onerous when one realizes that the lobbying involved was being paid for by the very same public that stood to be protected by the new regulations - so paying back TARP money was not just about freeing up executive pay, it was also about lobbying against the public interest with public money!
As many people have said throughout the worldwide financial crisis, any institution that is deemed "too big to fail" is: TOO BIG!
As Lawrence Summers said over the weekend, a $300 million banking industry lobbying push to "gut" financial market re-regulation is "frankly a bit rich."
Of course, the next question is how likely is the prospect of significant regulation of the banking industry from Washington? The House passed a banking regulation bill last week, and the Senate is working on its own version. The NY Times "Room for Debate" forum (attached) presents us with some opinions on the odds of significant regulation. See especially Edward Harrison who says we are unlikely to see substantive changes that will prevent another crisis in the financial arena. That sums it up.
Monday, December 14, 2009
Financial Regulation
http://www.nytimes.com/2009/12/14/opinion/14krugman.html?emc=eta1
There's an old saying from a Bob Dylan song that "Denial is not just a river in Egypt!" Krugman's post in today's NY Times (attached) refers to the subject of "denial" as it relates to financial regulation. Nothing could get me to yawn quicker than a discussion of financial regulation but the potential disaster we face if it is not properly handled can effect everyone.
It was probably logical that the more years that passed by after the Great Depression, the more pressure would mount to "deregulate" again. After all, for 40 years everything was OK. So, as Krugman points out, we deregulated with Ronald Reagan and got the savings-and-loan crisis of the 80s. That didn't seem to phase us so we went on to scrap one of the great pieces of Depression Era legislation in 1999 (Glass Steigel) so that (literally) Citicorp could merge with Travelers creating the great monstrosity: Citigroup.
And, of course, in this decade, we had Alan Greenspan admitting that he was wrong about the ability of the financial markets to police themselves (in addition to having no idea, as it was happening no less, that the sub-prime lending situation was as extensive as it was!).
With all of this as background: "...last Friday in the House of Representatives...with the meltdown caused by a runaway financial system still fresh in our minds, and the mass unemployment that meltdown caused still very much in evidence...every single Republican and 27 Democrats voted against a quite modest effort to rein in Wall Street excesses."
So, as Krugman points out, it will be up to the Democrats in the Senate to get behind financial reform. If they don't learn from the lessens of history, then we will all be condemned to repeat them. It is an old saying but one that continues to be true. As George McGovern said in the Washington Post over the weekend, Afghanistan is looking a lot like Viet Nam.
There's an old saying from a Bob Dylan song that "Denial is not just a river in Egypt!" Krugman's post in today's NY Times (attached) refers to the subject of "denial" as it relates to financial regulation. Nothing could get me to yawn quicker than a discussion of financial regulation but the potential disaster we face if it is not properly handled can effect everyone.
It was probably logical that the more years that passed by after the Great Depression, the more pressure would mount to "deregulate" again. After all, for 40 years everything was OK. So, as Krugman points out, we deregulated with Ronald Reagan and got the savings-and-loan crisis of the 80s. That didn't seem to phase us so we went on to scrap one of the great pieces of Depression Era legislation in 1999 (Glass Steigel) so that (literally) Citicorp could merge with Travelers creating the great monstrosity: Citigroup.
And, of course, in this decade, we had Alan Greenspan admitting that he was wrong about the ability of the financial markets to police themselves (in addition to having no idea, as it was happening no less, that the sub-prime lending situation was as extensive as it was!).
With all of this as background: "...last Friday in the House of Representatives...with the meltdown caused by a runaway financial system still fresh in our minds, and the mass unemployment that meltdown caused still very much in evidence...every single Republican and 27 Democrats voted against a quite modest effort to rein in Wall Street excesses."
So, as Krugman points out, it will be up to the Democrats in the Senate to get behind financial reform. If they don't learn from the lessens of history, then we will all be condemned to repeat them. It is an old saying but one that continues to be true. As George McGovern said in the Washington Post over the weekend, Afghanistan is looking a lot like Viet Nam.
Friday, December 11, 2009
Krugman on the Fed and Job Creation
http://www.nytimes.com/2009/12/11/opinion/11krugman.html?emc=eta1
When we referenced Galbraith at UT in our "Thinking Big" post on 12/9, we mentioned his back of the envelope perspective that we'd need 250,000 new jobs per month for 60 consecutive months to make up for the 7 (or8) million jobs lost (and the 15 million currently unemployed) since the recession began. Krugman raises the ante in his post today about what the Fed could or should be doing: "I don't think many people grasp just how much job creation we need to climb out of the hole we're in. You can't just look at 8 million jobs that America has lost since the recession began, because the nation needs to keep adding jobs - more than 100,000 a month - to keep up with a growing population. And that means that we need really big job gains, month after month, if we want to see America return to anything that feels like full employment."
Krugman continues: "How big? My back of the envelope calculation says we need to add around 18 million jobs over the next 5 years, or 300,000 jobs a month. This puts last week's employment report, which showed job losses of 'only' 11,000 in November, in perspective."
Krugman has said all along (with Warren Buffet) that the stimulus package was too small to begin with. He sees the measures proposed by President Obama earlier this week as definite "job creators" but far short of what the economy needs. That leaves the Fed. If Bernanke "believes", then his own forecasts should lead him there: the Fed's forecasts predict that unemployment will remain punishingly high for the next THREE years.
Krugman adds that a study done at the Petersen Institute, based on the prior work of Bernanke himself, strongly suggests that the Fed should expand credit by buying a further 2 trillion in assets. Do we think Bernanke knows that?
In the strongest words I've seen Krugman use, "But there's also, I believe, a question of priorities. The Fed sprang into action when faced with the prospect of wrecked banks; it doesn't seem equally concerned about the prospect of wrecked lives."
Aside from the fact that we join more people in the world reading Krugman's blog than any other (Thomas L. Friedman is #2) just because we are interested, his "posts" can cause the entire world of finance to take note (this would include Bernanke).
So, Krugman's last words from today's post urge the Fed to lose its complacency and start lending a hand to job creation. There is no question he was "heard" - now lets see what happens.
When we referenced Galbraith at UT in our "Thinking Big" post on 12/9, we mentioned his back of the envelope perspective that we'd need 250,000 new jobs per month for 60 consecutive months to make up for the 7 (or8) million jobs lost (and the 15 million currently unemployed) since the recession began. Krugman raises the ante in his post today about what the Fed could or should be doing: "I don't think many people grasp just how much job creation we need to climb out of the hole we're in. You can't just look at 8 million jobs that America has lost since the recession began, because the nation needs to keep adding jobs - more than 100,000 a month - to keep up with a growing population. And that means that we need really big job gains, month after month, if we want to see America return to anything that feels like full employment."
Krugman continues: "How big? My back of the envelope calculation says we need to add around 18 million jobs over the next 5 years, or 300,000 jobs a month. This puts last week's employment report, which showed job losses of 'only' 11,000 in November, in perspective."
Krugman has said all along (with Warren Buffet) that the stimulus package was too small to begin with. He sees the measures proposed by President Obama earlier this week as definite "job creators" but far short of what the economy needs. That leaves the Fed. If Bernanke "believes", then his own forecasts should lead him there: the Fed's forecasts predict that unemployment will remain punishingly high for the next THREE years.
Krugman adds that a study done at the Petersen Institute, based on the prior work of Bernanke himself, strongly suggests that the Fed should expand credit by buying a further 2 trillion in assets. Do we think Bernanke knows that?
In the strongest words I've seen Krugman use, "But there's also, I believe, a question of priorities. The Fed sprang into action when faced with the prospect of wrecked banks; it doesn't seem equally concerned about the prospect of wrecked lives."
Aside from the fact that we join more people in the world reading Krugman's blog than any other (Thomas L. Friedman is #2) just because we are interested, his "posts" can cause the entire world of finance to take note (this would include Bernanke).
So, Krugman's last words from today's post urge the Fed to lose its complacency and start lending a hand to job creation. There is no question he was "heard" - now lets see what happens.
Thursday, December 10, 2009
Conversions and Economic Recovery
http://knowledge.wharton.upenn.edu/article.cfm?articleid=2396
Knowledge@Wharton published an article yesterday that summarizes their discussions with a few professors, economists and company bosses in a range of industries on which economic indicators they plan to watch during the final quarter of 2009 and what they are waiting to see in 2010 that would convince them the economy is turning around. On the macro side, from retail to real estate, finance to factories, the central theme was "EMPLOYMENT". Retailers linked it to consumer confidence, real estate watchers to office space, bankers to loan losses, and manufacturers to product demand.
If we follow the logic of Susan Wachter (a Wharton real estate professor), high unemployment will persist thru 2010, impacting the real estate market. Now, although the residential real estate market is turning around, the commercial real estate market is the "next shoe to drop", and that isn't going to turn around until employment does. To quote Wachter: "Commercial is a lagging indicator, and it follows employment. Employment itself is a lagging indicator. Probably six months after we see employment improving we'll see commercial improving, and we won't see employment changing in 2010."
In business generally, one number we always tried to keep low was employee turnover. Of course, management accomplishes that with progressive employee relations policies that cause company loyalty and innovative thinking. However; low turnover can be an indicator of potential problems: as Arkadi Kuhlmann, president and CEO of ING Direct, pointed out to the K@W people, his company's annual turnover rate is usually about 18%. For the past year, it's been about 3%. Normally, 3% is great, but in this case it means that there aren't any jobs available out there. Now, Mr. Kuhlmann has other problems if his "normal" turnover rate is 18% - somebody calculate how long it takes his company to turn over 100% of it's population at 18% compounded - but the overall point is valid.
As we pointed out in a prior post, and K@W echoes, November's official numbers brought hope for an economic thaw. But, "jobs" are a lingering concern.
During the holiday season, the retail industry will be watching comparable store sales to see if shoppers spend more than they did in the same period last year. Retailers will also be watching "conversions": that is, how many shoppers who walk into a store actually buy something instead of just looking around.
So, during the holiday season, we have to get people into the malls, then get them into the stores, and then get them to "convert"! This is modern economics in America!
Knowledge@Wharton published an article yesterday that summarizes their discussions with a few professors, economists and company bosses in a range of industries on which economic indicators they plan to watch during the final quarter of 2009 and what they are waiting to see in 2010 that would convince them the economy is turning around. On the macro side, from retail to real estate, finance to factories, the central theme was "EMPLOYMENT". Retailers linked it to consumer confidence, real estate watchers to office space, bankers to loan losses, and manufacturers to product demand.
If we follow the logic of Susan Wachter (a Wharton real estate professor), high unemployment will persist thru 2010, impacting the real estate market. Now, although the residential real estate market is turning around, the commercial real estate market is the "next shoe to drop", and that isn't going to turn around until employment does. To quote Wachter: "Commercial is a lagging indicator, and it follows employment. Employment itself is a lagging indicator. Probably six months after we see employment improving we'll see commercial improving, and we won't see employment changing in 2010."
In business generally, one number we always tried to keep low was employee turnover. Of course, management accomplishes that with progressive employee relations policies that cause company loyalty and innovative thinking. However; low turnover can be an indicator of potential problems: as Arkadi Kuhlmann, president and CEO of ING Direct, pointed out to the K@W people, his company's annual turnover rate is usually about 18%. For the past year, it's been about 3%. Normally, 3% is great, but in this case it means that there aren't any jobs available out there. Now, Mr. Kuhlmann has other problems if his "normal" turnover rate is 18% - somebody calculate how long it takes his company to turn over 100% of it's population at 18% compounded - but the overall point is valid.
As we pointed out in a prior post, and K@W echoes, November's official numbers brought hope for an economic thaw. But, "jobs" are a lingering concern.
During the holiday season, the retail industry will be watching comparable store sales to see if shoppers spend more than they did in the same period last year. Retailers will also be watching "conversions": that is, how many shoppers who walk into a store actually buy something instead of just looking around.
So, during the holiday season, we have to get people into the malls, then get them into the stores, and then get them to "convert"! This is modern economics in America!
Wednesday, December 9, 2009
Thinking Big
http://roomfordebate.blogs.nytimes.com/2009/12/06/should-public-sector-jobs-come-first/?emc=eta1
http://economix.blogs.nytimes.com/2009/12/08/obamas-job-proposals/?emc=eta1
Paul Krugman recently called for an emergency program, perhaps a small-scale version of the New Deal's Works Progress Administration that would offer low paying public-service employment. A large share of the current stimulus package has gone to state governments, with the aim of preventing more layoffs among public sector workers and in public education. Should saving these government and education jobs be a priority? Is there a way to establish a public program quickly enough to employ the newly jobless? Would this be an efficient way to stimulate job creation?
The NY Times "Room for Debate" blog is first attached and asks some heavy hitters what they think about this issue. The responses are interesting. Read especially James K. Galbraith, an economist at UT Austin (and the son of John Kenneth Galbraith) who typically has his feet on the ground and finds some satisfaction in what we're doing to save the economy now relative to what his father advocated.
We have also attached a refreshingly brief summary of the Obama job proposals from the NY Times "Economix" blog. Within the "bullets", one can click on various perspectives of economists like Mark Zandi (much listened to and rightly so) and/or institutions with an interest in those proposals.
A moment on Galbraith: his perspective is that, as economics, the stimulus is working, but as politics, it is failing because in politics "part-way doesn't count." With 7 million jobs lost and 15 million people now out of work, people care about VISIBLE RESULTS - and they've not seen them yet. The question isn't whether we've turned a corner. It's how do we get all the way back to high employment, even in 5 years? We'd need nearly 250,000 new jobs every month for 60 months!!
So the problem isn't how best to choose between revenue sharing, infrastructure, public jobs and a payroll tax holiday. It's how to get all those things done - and also how to support small business and non-profits, to help students and to ease older workers into retirement.
There is a "Read more..." drop down that allows further review of Galbraith's comments and we strongly recommend what he has to say there about human resources and making "...no little plans."
Our fear in prior posts has been that we're back in 1937 and we haven't done enough (for those of you who are economic historians). World War II saved the economy then (with huge sacrifices) so things did not get back to growing until 1945, 8 years later. Obama's Chicago Booth School behavioral economists know that. That's why we have the new job proposals.
The American educational system needs more (and better) teachers. We can't spend too much on that. Saving a teacher's job or adding teacher jobs is "priceless". If that is any part of further stimulus, it should be applauded.
http://economix.blogs.nytimes.com/2009/12/08/obamas-job-proposals/?emc=eta1
Paul Krugman recently called for an emergency program, perhaps a small-scale version of the New Deal's Works Progress Administration that would offer low paying public-service employment. A large share of the current stimulus package has gone to state governments, with the aim of preventing more layoffs among public sector workers and in public education. Should saving these government and education jobs be a priority? Is there a way to establish a public program quickly enough to employ the newly jobless? Would this be an efficient way to stimulate job creation?
The NY Times "Room for Debate" blog is first attached and asks some heavy hitters what they think about this issue. The responses are interesting. Read especially James K. Galbraith, an economist at UT Austin (and the son of John Kenneth Galbraith) who typically has his feet on the ground and finds some satisfaction in what we're doing to save the economy now relative to what his father advocated.
We have also attached a refreshingly brief summary of the Obama job proposals from the NY Times "Economix" blog. Within the "bullets", one can click on various perspectives of economists like Mark Zandi (much listened to and rightly so) and/or institutions with an interest in those proposals.
A moment on Galbraith: his perspective is that, as economics, the stimulus is working, but as politics, it is failing because in politics "part-way doesn't count." With 7 million jobs lost and 15 million people now out of work, people care about VISIBLE RESULTS - and they've not seen them yet. The question isn't whether we've turned a corner. It's how do we get all the way back to high employment, even in 5 years? We'd need nearly 250,000 new jobs every month for 60 months!!
So the problem isn't how best to choose between revenue sharing, infrastructure, public jobs and a payroll tax holiday. It's how to get all those things done - and also how to support small business and non-profits, to help students and to ease older workers into retirement.
There is a "Read more..." drop down that allows further review of Galbraith's comments and we strongly recommend what he has to say there about human resources and making "...no little plans."
Our fear in prior posts has been that we're back in 1937 and we haven't done enough (for those of you who are economic historians). World War II saved the economy then (with huge sacrifices) so things did not get back to growing until 1945, 8 years later. Obama's Chicago Booth School behavioral economists know that. That's why we have the new job proposals.
The American educational system needs more (and better) teachers. We can't spend too much on that. Saving a teacher's job or adding teacher jobs is "priceless". If that is any part of further stimulus, it should be applauded.
Saturday, December 5, 2009
Good News
http://online.wsj.com/article_email/SB125993225142676615-lMyQjAxMDI5NTA5NTkwMzUyWj.html
Over the last two years (from that dismal November/December, 2007 period) there has not been much in the way of "good news" on the economy. Yesterday's much anticipated announcement by the BLS was some solid good news. The color graphs in the article we've attached from today's WSJ do an excellent job of highlighting the key positives:
Job Losses Slow - November data showed 11,000 jobs lost. Some analysts actually thought that was a misprint (thinking it had to be 111,000)! Obviously, that is the fewest jobs lost since the recession began 2 years ago. In addition, upward revisions showed that 159,000 fewer jobs were lost in September and October than were previously thought.
Temporary Hiring Picked Up - November data showed temporary hiring up 52,400. That is the 4th straight month for that key indicator.
Average Workweek - The length of the average workweek expanded from 33 to 33.2 hours. That this key indicator expands at all is important.
The overall unemployment rate dropped from 10.2% to 10% but that number may be an erratic one as the economy comes back (some economists expect it to get as high as 10.5%) because other key rates that affect it could bump it back up. The closely watched U6 rate (unemployed plus discouraged) dropped in November from 17.5% to 17.2%, a very good sign. But, if some of those formerly "discouraged" workers who are now back on the market don't find work, they'll be bumping the active unemployed numbers up.
Overall, November marked the 23rd straight month of overall job losses. There were 15.4 million Americans unemployed in November, more than twice as many as when the recession began.
So, while Stephen Stanley of RBS refers to these data as a "game changer" that should fundamentally alter perceptions regarding the economy, we prefer to be cautiously optimistic.
Over the last two years (from that dismal November/December, 2007 period) there has not been much in the way of "good news" on the economy. Yesterday's much anticipated announcement by the BLS was some solid good news. The color graphs in the article we've attached from today's WSJ do an excellent job of highlighting the key positives:
Job Losses Slow - November data showed 11,000 jobs lost. Some analysts actually thought that was a misprint (thinking it had to be 111,000)! Obviously, that is the fewest jobs lost since the recession began 2 years ago. In addition, upward revisions showed that 159,000 fewer jobs were lost in September and October than were previously thought.
Temporary Hiring Picked Up - November data showed temporary hiring up 52,400. That is the 4th straight month for that key indicator.
Average Workweek - The length of the average workweek expanded from 33 to 33.2 hours. That this key indicator expands at all is important.
The overall unemployment rate dropped from 10.2% to 10% but that number may be an erratic one as the economy comes back (some economists expect it to get as high as 10.5%) because other key rates that affect it could bump it back up. The closely watched U6 rate (unemployed plus discouraged) dropped in November from 17.5% to 17.2%, a very good sign. But, if some of those formerly "discouraged" workers who are now back on the market don't find work, they'll be bumping the active unemployed numbers up.
Overall, November marked the 23rd straight month of overall job losses. There were 15.4 million Americans unemployed in November, more than twice as many as when the recession began.
So, while Stephen Stanley of RBS refers to these data as a "game changer" that should fundamentally alter perceptions regarding the economy, we prefer to be cautiously optimistic.
Friday, December 4, 2009
Oil Supplies
http://www.washingtonpost.com/wp-dyn/content/article/2009/11/20/AR2009112002619.html?referrer=emailarticle
Now that we have the Al Gore pretenders on the run, perhaps we can go back to oil and a responsible search for it that can be accomplished closer to home without harm to the environment.
Every time we read that we're running out of oil, or we're polluting when we're trying to find it, or we're polluting when we're using it, my suggestion is that someone needs to slow down the debate and use some facts. Thanks to the government stimulus programs, we are protecting the "marsh mouse" in, or near San Francisco so we can all feel comfortable that the ecosystem is politically protected. We are living on a life line of container ships that, as Dr. Lawrence Redlinger so brilliantly pointed out last week in one of our seminars, ply the seas back and forth to other continents while using the dirtiest (cheapest) form of diesel oil for power. That's an easy example of what can be fixed - upgrade the power plants of the ships that service the U.S. by retrofitting, if that's even necessary, to use clean diesel power and require new container ships to use other versions of cost effective power plants. For example, we already have jet engines powering the largest luxury cruise ships to great effect (those ships are faster and more maneuverable while burning cleaner). But don't add to the government bureaucracy to "police" the power plants of container ships
George Will's article attached refers to the correlation between the natural momentum of government to creep toward further regulation and people's fears that they need protection. To quote Will: "Today, there is a name for the political doctrine that rejoices in scarcity of everything except government. The name is environmentalism."
Let's go to oil. Canada has (by some estimates) more oil than Saudi Arabia. Their oil sands pollute. Canada supplies more oil to the U.S. than any other country. What should the U.S. do? We'll leave that question open ended. The U.S. has more natural gas and coal than it needs for the next 50 years (at least). And, while U.S. politicians worry about the dangers to the "marsh mouse" of pumping oil off the east or west coasts, China is drilling 22 miles away from Miami. Modern technology is such that potential spills are far less problematic than they used to be.
So, the EPA announces this week that it's going to get the carbon by regulating CO2. This announcement was just in time for Copenhagen. Now, I'm not one of those fancy climate scientists, but my thought is that we exhale CO2 when we "breathe". So, what's next, no soda because we have an obesity epidemic?
Now that we have the Al Gore pretenders on the run, perhaps we can go back to oil and a responsible search for it that can be accomplished closer to home without harm to the environment.
Every time we read that we're running out of oil, or we're polluting when we're trying to find it, or we're polluting when we're using it, my suggestion is that someone needs to slow down the debate and use some facts. Thanks to the government stimulus programs, we are protecting the "marsh mouse" in, or near San Francisco so we can all feel comfortable that the ecosystem is politically protected. We are living on a life line of container ships that, as Dr. Lawrence Redlinger so brilliantly pointed out last week in one of our seminars, ply the seas back and forth to other continents while using the dirtiest (cheapest) form of diesel oil for power. That's an easy example of what can be fixed - upgrade the power plants of the ships that service the U.S. by retrofitting, if that's even necessary, to use clean diesel power and require new container ships to use other versions of cost effective power plants. For example, we already have jet engines powering the largest luxury cruise ships to great effect (those ships are faster and more maneuverable while burning cleaner). But don't add to the government bureaucracy to "police" the power plants of container ships
George Will's article attached refers to the correlation between the natural momentum of government to creep toward further regulation and people's fears that they need protection. To quote Will: "Today, there is a name for the political doctrine that rejoices in scarcity of everything except government. The name is environmentalism."
Let's go to oil. Canada has (by some estimates) more oil than Saudi Arabia. Their oil sands pollute. Canada supplies more oil to the U.S. than any other country. What should the U.S. do? We'll leave that question open ended. The U.S. has more natural gas and coal than it needs for the next 50 years (at least). And, while U.S. politicians worry about the dangers to the "marsh mouse" of pumping oil off the east or west coasts, China is drilling 22 miles away from Miami. Modern technology is such that potential spills are far less problematic than they used to be.
So, the EPA announces this week that it's going to get the carbon by regulating CO2. This announcement was just in time for Copenhagen. Now, I'm not one of those fancy climate scientists, but my thought is that we exhale CO2 when we "breathe". So, what's next, no soda because we have an obesity epidemic?
More Stimulus
http://online.wsj.com/article_email/SB10001424052748704107104574570331372941594-lMyQjAxMDA5MDAwMjEwNDIyWj.html
We have chronicled in prior posts (note the "plural") how Paul Krugman and Warren Buffet have concluded separately that more money needs to be pumped in to the economy, that the "stimulus program" was not enough. Others joined them in that position. One needs to look no further than an unemployment rate of 10.2% (or an "underemployment rate of 17.5%) to see that the potential for a "double-dip" recession is there.
When the Federal Government begins to conclude this, we see articles like the one attached authored by Christina Romer who is Chair of the President's Council of Economic Advisers. Dr. Romer's article was written to "position" the President's White House meeting yesterday on employment. As opposed to Lawrence (don't call me "Larry") Summers, for whom many (including this author, the entire female faculty at Harvard, and others) have little use, Christina Romer has the respect of most people even though she practices the dismal and imprecise science of economics.
Dr. Romer suggests in her remarks that the the stimulus did, indeed, turn around the economy as evidenced by the majority of "professional forecasters" agreeing with her position (these would be the same people who did NOT predict the financial collapse). More importantly, she quotes the Congressional Budget Office (no friend to the White House or either political party) as concluding that 3rd quarter GDP was up 1.2% to 3.2% over what it would have been had there been no stimulus. In addition, she quotes the CBO as in agreement that between 600,000 and 1.6 million jobs were created by stimulus money (directly or indirectly). While there is some dispute about the jobs numbers, there is little dispute about the GDP numbers.
However; Dr. Romer goes on to point out that, despite these successes, the job market remains weak. She sees American businesses as hesitant to hire while producing more with fewer workers. She is, as she says, looking for large and small businesses to come in off the sidelines to "boost job creation." She mentions that the government could provide "incentives" to help small businesses invest, grow and create jobs. This would include measures to restore the flow of credit for small businesses and targeted tax cuts. Her whole position, with these and other suggestions that she has, is that moderate and targeted investment by the government might be leveraged into significant employment gains and purchasing power by small businesses.
She should be applauded for her position and, hopefully, something will come of it. As we said in our prior post, small businesses and new businesses are where most job creation takes place.
The original stimulus program (inclusive of all the money that was spent beyond the $787 B) was
not enough. The original stimulus program was supposed to keep unemployment at 8% or less. It did not. Dr. Romer's suggestions provide a way to supplement that stimulus without appearing to go back to Congress and admitting to failure. Most importantly, her ideas do something for employment.
We have chronicled in prior posts (note the "plural") how Paul Krugman and Warren Buffet have concluded separately that more money needs to be pumped in to the economy, that the "stimulus program" was not enough. Others joined them in that position. One needs to look no further than an unemployment rate of 10.2% (or an "underemployment rate of 17.5%) to see that the potential for a "double-dip" recession is there.
When the Federal Government begins to conclude this, we see articles like the one attached authored by Christina Romer who is Chair of the President's Council of Economic Advisers. Dr. Romer's article was written to "position" the President's White House meeting yesterday on employment. As opposed to Lawrence (don't call me "Larry") Summers, for whom many (including this author, the entire female faculty at Harvard, and others) have little use, Christina Romer has the respect of most people even though she practices the dismal and imprecise science of economics.
Dr. Romer suggests in her remarks that the the stimulus did, indeed, turn around the economy as evidenced by the majority of "professional forecasters" agreeing with her position (these would be the same people who did NOT predict the financial collapse). More importantly, she quotes the Congressional Budget Office (no friend to the White House or either political party) as concluding that 3rd quarter GDP was up 1.2% to 3.2% over what it would have been had there been no stimulus. In addition, she quotes the CBO as in agreement that between 600,000 and 1.6 million jobs were created by stimulus money (directly or indirectly). While there is some dispute about the jobs numbers, there is little dispute about the GDP numbers.
However; Dr. Romer goes on to point out that, despite these successes, the job market remains weak. She sees American businesses as hesitant to hire while producing more with fewer workers. She is, as she says, looking for large and small businesses to come in off the sidelines to "boost job creation." She mentions that the government could provide "incentives" to help small businesses invest, grow and create jobs. This would include measures to restore the flow of credit for small businesses and targeted tax cuts. Her whole position, with these and other suggestions that she has, is that moderate and targeted investment by the government might be leveraged into significant employment gains and purchasing power by small businesses.
She should be applauded for her position and, hopefully, something will come of it. As we said in our prior post, small businesses and new businesses are where most job creation takes place.
The original stimulus program (inclusive of all the money that was spent beyond the $787 B) was
not enough. The original stimulus program was supposed to keep unemployment at 8% or less. It did not. Dr. Romer's suggestions provide a way to supplement that stimulus without appearing to go back to Congress and admitting to failure. Most importantly, her ideas do something for employment.
The New Normal: Jobless Recoveries
http://online.wsj.com/article_email/SB10001424052748703735004574574311468146726-lMyQjAxMDA5MDAwNDEwNDQyWj.html
We began this decade with a post 9/11 jobless recovery and we're ending it the same way. James Bullard, who is president of the St. Louis Federal Reserve Bank, says this is the third consecutive "jobless recovery". As Mark Gongloff argues in the article attached, companies fired workers too aggressively this time, but they show little inclination to rehire, even though the recession has supposedly been over for 5 months. Obviously, globalization and technology have made it increasingly easy for companies to slash labor costs.
As we have indicated in prior posts, the job market is getting "less bad" but we are still losing 125,000 jobs per month (current estimate). The BLS (Bureaus of Labor Statistics) data scheduled for release today should have unemployment holding at 10.2%. If we accept that the current recession began in November, 2007, job losses since then amount to 7.4 million (other estimates are as high as 8 million).
A record 9.3 million people are working part time because there is nothing else available. Since May, more than a million people have left the labor force.
Given all of this, there are 3 numbers that Wall Street will be watching closely in today's BLS announcement:
Temporary Services: Employers added 34,000 temporary jobs last month, the third srtaight month of rising temporary employment. Temps are generally seen as a leading indicator of job market turnaround because they are the last thing employers do to avoid hiring full time employees.
"U6": This is the measure of unemployment that includes people who have stopped actively searching for work, or are working part-time because they can't find full-time work. This number hit 17.5% in October. This is the government's broadest measure of labor underutilization.
Average Work-Week: Like "temps", this is considered a forward looking gauge of the labor market. In both September and October, the average work-week has stayed at 33 hours - that's the lowest level since World War II. Again, employers would rather add to the hours of current employees than hire new ones.
Something could show up in today's BLS numbers that would show more of a positive trend (as has been the case with temps). Looking at average work-week hours could be a clue.
In the meantime, where do the new jobs come from? As we have emphasized in earlier posts small businesses (or new businesses) lead the way but it is hard for them to do that with tight credit. While the White House yesterday was holding a meeting on the job situation, the Treasury Department could have emphasized easing credit to small business ahead of saving the big banks over the past year.
And, on the subject of saving our too big to fail financial institutions, doesn't it seem strange that those same institutions are using and have used bail out money to lobby Congress NOT to pass new regulatory oversight bills? Do we have any idea what we're doing in government?
Have any new oversight agencies been created? Maybe "jobs" could be created in new oversight agencies - there's a concept!
We began this decade with a post 9/11 jobless recovery and we're ending it the same way. James Bullard, who is president of the St. Louis Federal Reserve Bank, says this is the third consecutive "jobless recovery". As Mark Gongloff argues in the article attached, companies fired workers too aggressively this time, but they show little inclination to rehire, even though the recession has supposedly been over for 5 months. Obviously, globalization and technology have made it increasingly easy for companies to slash labor costs.
As we have indicated in prior posts, the job market is getting "less bad" but we are still losing 125,000 jobs per month (current estimate). The BLS (Bureaus of Labor Statistics) data scheduled for release today should have unemployment holding at 10.2%. If we accept that the current recession began in November, 2007, job losses since then amount to 7.4 million (other estimates are as high as 8 million).
A record 9.3 million people are working part time because there is nothing else available. Since May, more than a million people have left the labor force.
Given all of this, there are 3 numbers that Wall Street will be watching closely in today's BLS announcement:
Temporary Services: Employers added 34,000 temporary jobs last month, the third srtaight month of rising temporary employment. Temps are generally seen as a leading indicator of job market turnaround because they are the last thing employers do to avoid hiring full time employees.
"U6": This is the measure of unemployment that includes people who have stopped actively searching for work, or are working part-time because they can't find full-time work. This number hit 17.5% in October. This is the government's broadest measure of labor underutilization.
Average Work-Week: Like "temps", this is considered a forward looking gauge of the labor market. In both September and October, the average work-week has stayed at 33 hours - that's the lowest level since World War II. Again, employers would rather add to the hours of current employees than hire new ones.
Something could show up in today's BLS numbers that would show more of a positive trend (as has been the case with temps). Looking at average work-week hours could be a clue.
In the meantime, where do the new jobs come from? As we have emphasized in earlier posts small businesses (or new businesses) lead the way but it is hard for them to do that with tight credit. While the White House yesterday was holding a meeting on the job situation, the Treasury Department could have emphasized easing credit to small business ahead of saving the big banks over the past year.
And, on the subject of saving our too big to fail financial institutions, doesn't it seem strange that those same institutions are using and have used bail out money to lobby Congress NOT to pass new regulatory oversight bills? Do we have any idea what we're doing in government?
Have any new oversight agencies been created? Maybe "jobs" could be created in new oversight agencies - there's a concept!
Tuesday, December 1, 2009
Sustainable Energy
http://www.washingtonpost.com/wp-dyn/content/article/2009/11/23/AR2009112303966.html?referrer=emailarticle
There has to be some middle ground in the efforts we all make to support an energy future. Nobody wants to pollute. While we have pointed out here that the global alarmists need to be controlled lest they drain more money from world economies that could be used to create jobs and feed the starving, we want a future where energy can be created with less pollution.
We were touched by a video that debuted over the weekend about Peter Burns and the work he is doing at the University of Notre Dame's Energy Frontier Research Center. It is part of the University's "What Would You Fight For?" series: http.//video.nd.edu. Burns has developed an approach to convert nuclear waste into clean energy. Clean energy that won't pollute.
What we are willing to support here is nuclear energy. We think it's time has come and we think we need to encourage its use. As the chart in the Washington Post article we have attached shows, 76% of the electrical supply in France is "nuclear". Here in the U.S., its 19%. While we are building wind energy sources, which we also support, we need to build nuclear plants. While the world has suffered Chernobyl and, closer to home, Three Mile Island, today's technology (and training) is more sophisticated.
It has been 13 years since the last nuclear power plant was built in the U.S. An Environmental Protection Agency analysis of the Waxman-Markey bill passed by the House shows nuclear energy more than doubling in the U.S. by 2050 if the legislation is made law. Groups like the Sierra Club, the Environmental Defense Fund and others have backed off their opposition to "nuclear" because they see it as a "clean" alternative.
Of course, some leading environmental figures like Al Gore remain skeptical of nuclear's promise, largely because of the high cost of building plants and the threat of proliferation. If anything convinces me that my position on this issue is right, it is that Al Gore opposes it. Gore did tell the Washington Post Editorial Board, "I am not anti-nuclear (is that a double negative?), but the cost of the present generation of reactors is nearly prohibitive."
Perhaps more nuclear and less coal?
There has to be some middle ground in the efforts we all make to support an energy future. Nobody wants to pollute. While we have pointed out here that the global alarmists need to be controlled lest they drain more money from world economies that could be used to create jobs and feed the starving, we want a future where energy can be created with less pollution.
We were touched by a video that debuted over the weekend about Peter Burns and the work he is doing at the University of Notre Dame's Energy Frontier Research Center. It is part of the University's "What Would You Fight For?" series: http.//video.nd.edu. Burns has developed an approach to convert nuclear waste into clean energy. Clean energy that won't pollute.
What we are willing to support here is nuclear energy. We think it's time has come and we think we need to encourage its use. As the chart in the Washington Post article we have attached shows, 76% of the electrical supply in France is "nuclear". Here in the U.S., its 19%. While we are building wind energy sources, which we also support, we need to build nuclear plants. While the world has suffered Chernobyl and, closer to home, Three Mile Island, today's technology (and training) is more sophisticated.
It has been 13 years since the last nuclear power plant was built in the U.S. An Environmental Protection Agency analysis of the Waxman-Markey bill passed by the House shows nuclear energy more than doubling in the U.S. by 2050 if the legislation is made law. Groups like the Sierra Club, the Environmental Defense Fund and others have backed off their opposition to "nuclear" because they see it as a "clean" alternative.
Of course, some leading environmental figures like Al Gore remain skeptical of nuclear's promise, largely because of the high cost of building plants and the threat of proliferation. If anything convinces me that my position on this issue is right, it is that Al Gore opposes it. Gore did tell the Washington Post Editorial Board, "I am not anti-nuclear (is that a double negative?), but the cost of the present generation of reactors is nearly prohibitive."
Perhaps more nuclear and less coal?
Climategate
http://online.wsj.com/article_email/SB10001424052748703499404574562123968802420-lMyQjAxMDA5MDMwMDEzNDAyWj.html
http://online.wsj.com/article_email/SB10001424052748703939404574566124250205490-lMyQjAxMDA5MDMwMDEzNDAyWj.html
http://online.wsj.com/article_email/SB10001424052748703939404574567423917025400-lMyQjAxMDA5MDMwMDEzNDAyWj.html
There is always the temptation to gloat when one sees pompous, self serious and self important people proved wrong. Fortunately for those of us who are like-minded on the subject of "global cooling", both pure data and efforts to "cover up" data (on the part of what were thought to be world class scientists) lead to the inevitable conclusion that little, if any, science supports global warming.
Perhaps that's a start. As Bjorn Lomborg points out (attached), the lack of water for the poor in the shadow of the Himalayas (in this case, Nepal), has been used by Al Gore and others to argue for short term cuts in carbon emissions. Climate activists argue that there is a "link" between melting glaciers in the Himalayas and water shortages elsewhere.
This hypothesis has not been supported by a new report released in November by the Indian government which indicates that the majority of these glaciers are stable or have even advanced. Jeffery Kargel, a glaciologist at the University of Arizona, declared in a November 13 article in "Science" that these extremely provocative findings were consistent with what he has learned independently.
Two things: (1) there is a growing body of knowledge from respected scientists that the world's glaciers are NOT melting; and (2) spending money on helping the poor to keep them from going hungry comes ahead of fancy schemes to get the carbon.
Now, moving on, we find that some of the world's leading scientists have worked in tandem to block freedom of information requests, blackball dissenting scientists, manipulate the peer-review process, and obscure, destroy or massage "inconvenient" temperature data - this after the disclosure of thousands of emails from the University of East Anglia's Climate Research Unit, or CRU. This is the heart of "Climategate" (attached).
To put it bluntly, there was a direct correlation between the research money brought in to the CRU and their conclusions that global warming was occurring from various sources. According to estimates by the HSBC Bank, $94 billion will be spent globally this year on what is called "green stimulus" - largely ethanol and other alternative energy schemes - of the kind from which Al Gore and his partners at Kleiner Perkins hope to profit from handsomely.
Relying on the "dismal science" ("Economics", for those of you who have not heard the term) for a moment, supply creates its own demand. So, for every additional billion in government-funded grants, universities, research institutes, advocacy groups and their various spin-offs have emerged from the woodwork to receive them. And, as the WSJ "Climategate" article so aptly points out, these groups form a kind of "ecosystem" of their own. So, while the Sierra Club and Greenpeace (and so many others) are sincere in their beliefs about what needs to be changed (and soon), the very "science" that backs them up is, to quote one of their own scientists: "garbage".
Here's the best we can say about "climate science": it isn't settled and claims that climate change is accelerating are bizarre. Richard Lindzen is a meteorologist at MIT. His perspective makes sense and it is well expressed in the article attached (WSJ Opinion). Lindzen points out that there is reason to be concerned about what global warming measures are being used because those measures are imprecise: the Global Average Temperature Anomaly (GATA) is always changing. There is general support for the assertion that GATA has increased by about 1.5 degrees Fahrenheit since the middle of the 19th century. But, the quality of the data is poor. Several of the emails from the CRU dealt with how to manipulate the data to maximize apparent warming changes.
The general support for warming, according to Lindzen, is based not so much on the quality of the data, but on the fact that there was a "little ice age" from about the 15th to the 19th century. Thus, it is not surprising that temperatures should increase as we emerged from this episode. With the advancement of the modern industrial age, CO2 has added to warming but not to any major extent.
And, the "environmental models" that did not predict the "...absence of warming for the past dozen years..." are now being modified to justify what they missed and they now predict warming will resume in 2009 (aren't we in 2009?), 2013 and 2030, respectively.
The temptation here is to be sarcastic because it is just not a fair fight but we won't be. Rather, we will follow Lindzen's perspective as he points out that the East Anglia scandal is greater than just the hacked emails from the CRU: namely the suggestion that the very existence of warming, or the greenhouse effect, is tantamount to catastrophe. To Lindzen, it is the grossest of "bait and switch" scams. To him, the notion that complex climate "catastrophes" are simply a matter of response to a single number, GATA, represents a gigantic step backward in the science of climate: many disasters associated with warming are simply normal occurrences whose existence is falsely claimed to be evidence of warming. And, all these phenomena are dependent on the confluence of many factors.
So, what do we have? We have a bunch of scientists looking to manipulate their data to show global warming is the cause of of my aunt's headaches so they can get research grants. And, the mere fact that the scientists think they need to manipulate the data to show warming trends kind of shows, as one of them so correctly stated, that their data is "garbage."
Is there a return policy on Al Gore's Nobel?
http://online.wsj.com/article_email/SB10001424052748703939404574566124250205490-lMyQjAxMDA5MDMwMDEzNDAyWj.html
http://online.wsj.com/article_email/SB10001424052748703939404574567423917025400-lMyQjAxMDA5MDMwMDEzNDAyWj.html
There is always the temptation to gloat when one sees pompous, self serious and self important people proved wrong. Fortunately for those of us who are like-minded on the subject of "global cooling", both pure data and efforts to "cover up" data (on the part of what were thought to be world class scientists) lead to the inevitable conclusion that little, if any, science supports global warming.
Perhaps that's a start. As Bjorn Lomborg points out (attached), the lack of water for the poor in the shadow of the Himalayas (in this case, Nepal), has been used by Al Gore and others to argue for short term cuts in carbon emissions. Climate activists argue that there is a "link" between melting glaciers in the Himalayas and water shortages elsewhere.
This hypothesis has not been supported by a new report released in November by the Indian government which indicates that the majority of these glaciers are stable or have even advanced. Jeffery Kargel, a glaciologist at the University of Arizona, declared in a November 13 article in "Science" that these extremely provocative findings were consistent with what he has learned independently.
Two things: (1) there is a growing body of knowledge from respected scientists that the world's glaciers are NOT melting; and (2) spending money on helping the poor to keep them from going hungry comes ahead of fancy schemes to get the carbon.
Now, moving on, we find that some of the world's leading scientists have worked in tandem to block freedom of information requests, blackball dissenting scientists, manipulate the peer-review process, and obscure, destroy or massage "inconvenient" temperature data - this after the disclosure of thousands of emails from the University of East Anglia's Climate Research Unit, or CRU. This is the heart of "Climategate" (attached).
To put it bluntly, there was a direct correlation between the research money brought in to the CRU and their conclusions that global warming was occurring from various sources. According to estimates by the HSBC Bank, $94 billion will be spent globally this year on what is called "green stimulus" - largely ethanol and other alternative energy schemes - of the kind from which Al Gore and his partners at Kleiner Perkins hope to profit from handsomely.
Relying on the "dismal science" ("Economics", for those of you who have not heard the term) for a moment, supply creates its own demand. So, for every additional billion in government-funded grants, universities, research institutes, advocacy groups and their various spin-offs have emerged from the woodwork to receive them. And, as the WSJ "Climategate" article so aptly points out, these groups form a kind of "ecosystem" of their own. So, while the Sierra Club and Greenpeace (and so many others) are sincere in their beliefs about what needs to be changed (and soon), the very "science" that backs them up is, to quote one of their own scientists: "garbage".
Here's the best we can say about "climate science": it isn't settled and claims that climate change is accelerating are bizarre. Richard Lindzen is a meteorologist at MIT. His perspective makes sense and it is well expressed in the article attached (WSJ Opinion). Lindzen points out that there is reason to be concerned about what global warming measures are being used because those measures are imprecise: the Global Average Temperature Anomaly (GATA) is always changing. There is general support for the assertion that GATA has increased by about 1.5 degrees Fahrenheit since the middle of the 19th century. But, the quality of the data is poor. Several of the emails from the CRU dealt with how to manipulate the data to maximize apparent warming changes.
The general support for warming, according to Lindzen, is based not so much on the quality of the data, but on the fact that there was a "little ice age" from about the 15th to the 19th century. Thus, it is not surprising that temperatures should increase as we emerged from this episode. With the advancement of the modern industrial age, CO2 has added to warming but not to any major extent.
And, the "environmental models" that did not predict the "...absence of warming for the past dozen years..." are now being modified to justify what they missed and they now predict warming will resume in 2009 (aren't we in 2009?), 2013 and 2030, respectively.
The temptation here is to be sarcastic because it is just not a fair fight but we won't be. Rather, we will follow Lindzen's perspective as he points out that the East Anglia scandal is greater than just the hacked emails from the CRU: namely the suggestion that the very existence of warming, or the greenhouse effect, is tantamount to catastrophe. To Lindzen, it is the grossest of "bait and switch" scams. To him, the notion that complex climate "catastrophes" are simply a matter of response to a single number, GATA, represents a gigantic step backward in the science of climate: many disasters associated with warming are simply normal occurrences whose existence is falsely claimed to be evidence of warming. And, all these phenomena are dependent on the confluence of many factors.
So, what do we have? We have a bunch of scientists looking to manipulate their data to show global warming is the cause of of my aunt's headaches so they can get research grants. And, the mere fact that the scientists think they need to manipulate the data to show warming trends kind of shows, as one of them so correctly stated, that their data is "garbage."
Is there a return policy on Al Gore's Nobel?
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