Regular Features Sandpit January 13, 2020 John Quiggin16 Comments A new sandpit for long side discussions, conspiracy theories, idees fixes and so on. Like this:Like Loading... Related
16 thoughts on “Sandpit”
Iv’e always loved his intro to this column.
It is almost like he is operating an ant farm.
Loneliness of the long distance Academic.
Good to see this is being framed as morrisons port arthur moment. He can only fail. Indeed the cringing courtiers in the fawning corporate media have been reduced to kremlinology and dave sharma is so desperate he’s twittered the “commitments” of his own pm in an effort to lock him in.
Just recently I’ve come across a new kind of “sceptic”. I’d call them the climate change atheist. That is, they claim that GHGs have not been proved guilty, so at this stage the verdict is not guilty (the onus of proof being on the those making the claim). They say that they accept the basic science (CO2 is a GHG and the temperature record is accurate) and claim not to frequent extremist denialist sites like WUWT. They’ll reference research which indicates other potential sources of climate change (i.e the weakening of the earths magnetic field), and suggest that more research needs to be undertaken. They’ll say that we shouldn’t even consider the precautionary principle, and will only be satisfied when 100% of climate scientists accept the GHG theory of ACC.
My guess is that this is the new tactic of the FF industry. The cool, calm atheist. Not an extremist, no need to rush anything. They’ve learnt there lesson from the likes of Muller. Don’t fund scientific research to disprove the GHG theory of ACC (they know what the results will be). The less money spent on CC research the better (thus the attempts to de-fund research – “the scientists are always angling for more research dollars”). Better to spend your money on continuing to sowing seeds of doubt.
They seem to have no problem in contradicting themselves (more research is needed, but don’t fund the scientist). Hoping the average Joe is too slow to pick this up.
A few weeks ago I did mention on this blogsite that ghg emission tariffs are a way to at least help enforce international agreements on ghg emissions and the EU is working on this. Today’s der spiegel online contains an article on the latter point. The name assigned to such a tariff is “climate tariff”. It ain’t going to happen tomorrow or the day after but I expect it to happen in the near future. There are practicalities to be worked out such as how to determine the ghg content of products (and there are millions).
That sounds very promising Ernestine. Perhaps they need to reword it to remove the word “tariffs”. There is too much baggage with that term. Could I suggest it be replaced with the word “levies”. Whereas “tariffs” often invite retaliation, when “levies” are imposed they can be presented as a fee or fine. In this way the true intent of the impost is clear. Usually this does not invite retaliatory actions.
The forces who don’t want carbon taxes or carbon tariffs have been too strong to date. They won in the crucial time window for addressing this problem. Now it is probably too late. However, we have to keep trying. There is a still a slim chance we can prevent complete runaway climate change.
I must admit that even I am astonished by the enormous stubbornness and resistance of Morrison to even acknowledging that there is a problem, let alone do anything about it. This shows there is something he fears more than losing the next election. He fears losing the favor of his political and eventual personal paymasters, the fossil fuel donors. It will be instructive to see what golden parachute Morrison gets when he finally leaves parliament.
Gregory, I have no influence on the wording. I also don’t know what the official EU term will be eventually. In the past an English term could be assumed to be used for international communication. Maybe it will be a French term in the future. But your point is well taken. The word ‘tariff’ could be reserved for the marketable component of goods.
This topic interests me because non-binding agreements on the political level can’t be relied on (eg USA, Brasil and Australia -the latter more covertly so far); the legal avenue of binding agreements is extremely expensive and presupposes the measurements which a levy requires. So, a levy is a logical solution. The EU is the only ‘large’ trading block with a low ghg emission per person relative to the USA and China. Hence they are in a relatively good position to make a move. The highly industrialised part of the EU has a strong incentive to not deindustrialise and increase global warming through relocation of production to say Brasil or India. Given the UK’s record on reducing ghg emissions, I would expect they play in tune with the EU in the future.
It looks like Adman is going for a policy of adaption to rather than addressing global warming. The hospice solution. Im a bit surprised. I thought he would shift the paris target, at least. After all, its just aspirational. Nope. This man is not a fake. He truly is a gutless dinosaur. Any voters out there waiting for a big policy are going to be desperately disappointed. So will inner city lib mps. I reckon Phelps will be gearing up for another run at Sharma, etc, etc
Re your article ¨Slow Burn¨
On December 2 last Norman Swan on his Health Report (ABC RN -Still available on the ABC Listen app or the ABC website) had an interview with Francesca Dominici co-Director of Harvard Data Science Initiative on Bushfires, air quality and hospital admissions. Based on a very large US dataset it indicates that the adverse health effects of PM2.5 particulates are much broader than commonly thought. Definitely worth hearing. She can be followed on twitter @francescadomin8
More on the EU and climate change and subtle media message management from the finance industry.
“The Europe Investment Plan, to be unveiled on Tuesday, will be funded by the EU budget and the private sector. It aims to deliver on European Commission president Ursula von der Leyen’s Green Deal to make the bloc the world’s first carbon-neutral continent by 2050.” [quoted in Climate change will reshape finance – world’s largest fund manager says, smh, 15 Jan 2020]
Larry Fink CEO and co-founder BlackRock (NY based multinational fund (‘asset’) management company, said to be the biggest in the world) is quoted in the smh article as saying:
“Because capital markets pull future risk forward, we will see changes in capital allocation more quickly than we see changes to the climate itself,”
Careful. There is the hypothesis that capital markets provide an institutional mechanism to aggregate investor’s (people) expectations about the uncertain future (eg risk). In this sense risk is hypothesed to be ‘priced’ in the capital market. This theoretical idea essentially is largely negated if large movers and shakers in the capital market, such as BlackRock, becoming aware of future risk about 30 or 40 years after scientists have talked about it and economists have been developing methods to ‘price’ negative externalities, about which they have been aware conceptually for much longer. Empirically, the global financial crisis is perhaps the best example of the divergence between the belief of the role of capital markets in allocating risk and reality.
In the context of the smh article, I would say it is the decision by the EU that pulls the big movers and shakers in the world of finance (capital markets) into the reality of where scientists and economists (at least a lot of them) say a major source of risk lies.
Ernestine. Be very careful – I believe Blackroock is divesting only if revenue from thermal coal above 25%. That leaves them able to fund for eg glencore.
So really a big pr excersize and slow windback so they dont lose stellar returns..
They don’t bother with risk unless it mucks with their discount rate.
KT2, hence “subtle media message management”.
KT2, Ernestine Gross, mycraw and Ikon deal with it (eyeball roll).
Paul and all, I will let McKibbin speak for me. And why does Blackrock not receive the oprobrium ala antivaxers or laggard deniers and politicians? Because – $7T! Note an article in today “Australians just had their best super returns since 2013 — analysts say they can thank Donald Trump”. Yay.
“But while some celebrated, others warned that sustainable investing will not be quick or simple for BlackRock. It currently holds a 6.7% stake in ExxonMobil, 6.9% in Chevron, and 6% in the mining company Glencore. Two-thirds of its $7tn in assets are in tracking funds that cannot easily be switched to meet sustainability goals.
“BlackRock now needs to use its voting clout to fuel sustainable investing
“McKibben, who last year published a devastating report in the New Yorker titled Money Is the Oxygen on Which the Fire of Global Warming Burns and who is part of a campaign to force companies including Goldman Sachs, Chase Bank and BlackRock to reform their investments, said environmentalists would now need to keep the pressure up.
“The steps BlackRock is taking are baby steps, and we will have to watch and push hard for them to begin striding at the pace we need to go. But in some sense, the first step is often the hardest,” McKibben said.
“He urged the company to go further. Its decision to divest $500m from coal-related businesses, for instance, is not the same as divesting from larger and far more polluting oil and gas industries.
“Coal is part of the problem, but not the biggest part of the problem – oil and gas are,” McKibben said. “Fink made noises that natural gas is part of the solution but it’s not. That’s old thinking, and we’ll push them hard on that, but at least we’ve reached the point that they’ve realized they have a role in dealing with the climate crisis.”
“But perhaps the largest change is BlackRock’s apparent willingness to use its considerable shareholder power to demand climate action – a power it has in the past demurred from using in favor of direct company consultations.”
It’s the compliance that will be an issue
“BlackRock has been engaging with companies for several years on their progress towards TCFD- and SASB-aligned reporting. This year, we are asking the companies that we invest in on behalf of our clients to:
(1) publish a disclosure in line with industry-specific SASB guidelines by year-end, if you have not already done so, or disclose a similar set of data in a way that is relevant to your particular business; and
(2) disclose climate-related risks in line with the TCFD’s recommendations, if you have not already done so. This should include your plan for operating under a scenario where the Paris Agreement’s goal of limiting global warming to less than two degrees is fully realized, as expressed by the TCFD guidelines.”
I should have realised Ernestine had subtly mentioned “KT2, hence “subtle media message management”.