Written by Marc Morano
National Review - Global-Warming Bubble – June 20, 2008
Excerpt: Rarely has so much hectoring produced so little. After all the magazine covers, celebrity sermonizing and U.N.-certified-expert hand-wringing, the fight against global warming got a real-world test in the U.S. Senate a few weeks ago in the debate over a proposal to limit carbon emissions through a cap-and-trade system. After a small dose of the argument, supporters of the proposal couldn’t wait to drop it. […]
Lately, we’ve seen the tech and housing bubbles burst, and now — at least as an urgent political issue — the global-warming bubble is getting pricked.
Let’s count the ways:
First, those gas prices. They are just one way that the soaring price of oil has put a crimp in the standard of living of Americans. They have little taste for seeing it crimped more, and why should they? The cost-benefit analysis of battling global warming is never going to make sense for Americans. No matter what the price of gas is, the most sensible policy in the U.S. is to avoid costly schemes to fight global warming. If our economy keeps growing, we will be better positioned — richer, and more technologically proficient — to help others mitigate its effects decades from now.
Senate Majority Leader Harry Reid huffs that global warming is “the most critical issue of our time.” Really? More critical than energy prices? Than health care? Than wages? Than terrorism? Than nuclear proliferation? Keep huffing, Mr. Reid — that deflating bubble needs all the air it can get. […] Finally, there’s the global-cooling spell.
The world hasn’t been warming since 1998, and an article in the journal Nature says warming won’t pick up again until 2015. Since global warming is a long-term trend, a decade-long or more stall in temperatures doesn’t mean much — except that environmentalists have banked so much politically on whipping up hysteria based on imminent catastrophe.
The stall in temperatures shows how little we know about global warming. It means that the .3 degrees Celsius increase in global temperatures predicted during the next decade by the U.N.’s much-vaunted Intergovernmental Panel on Climate Change may not happen.
Reuters: Fuel Protests 'spread Across World'’, China Increases Petrol Prices - June 19, 2008 (h/t CCNET)
Excerpt: Spanish farmers marched, Israeli truckers slowed rush-hour traffic and Nepali students stoned cars on Thursday, all angry at rising fuel prices and inflation that they say are crippling their economies. Protests by truckers, taxi drivers, fishermen and farmers demanding fuel-tax breaks have spread across the world, increasing fears of political instability and a global economic downturn.
The oil price, which dipped $3 to $133 on news that China will raise retail gasoline and diesel prices from Friday, has touched record highs near $140 in recent months, fuelling inflation and squeezing business margins. In Madrid, thousands of farmers brought traffic to a halt on the capital's busiest road to demand lower diesel tax to help cushion the blow of higher fuel costs and low producer prices. "This is the last straw. If good spring rain hadn't arrived this year and last, we would already have gone bust," said sugarbeet farmer Evaristo Ortega.
"The price of diesel and fertiliser is impossible to bear." Diesel prices have shot up to around 1 euro ($1.56), from 60 cents a year ago, farmers said as they marched past soccer club Real Madrid's Bernabeu Stadium carrying banners reading: "For the future of our countryside". In the United States, government data showed people drove less in April for the sixth month in a row, following record gasoline prices as more people used public transport.
In Greece, the cost of living has replaced unemployment as the top concern, unions said. Food prices have risen and motorists pay 13 percent more for fuel than a year ago and heating oil costs 38 percent more. About 2,000 Greeks protested against sharp increases in prices and demanded action from the conservative government.
Protesters in central Athens chanted slogans such as "Enough with poverty and unemployment" and held banners reading "We're the European champions of profiteering". "I don't have enough money to pay the rent and shop for food," said pensioner Katerina Nanou, 67. "We want real measures against high prices, this government is mocking us."
Wall Street Journal – The 'Idle' Oil Field Fallacy – June 20, 2008
Excerpt: A bill introduced in Congress this week would "compel" oil and natural gas companies to produce from federal lands they are leasing. If only it were that easy to find and produce oil. Imagine, an act of Congress that could do what geology could not. These lawmakers ask why oil and gas companies want more access to federal lands to drill if they aren't using all of the 68 million acres they already have?
Anyone with even the most basic understanding of how oil and natural gas are produced – and this should include many members of Congress – knows that claims of "idle" leases are a diversionary feint. […] In reality, a lease is simply a block on a map, with no guarantee that it contains any resources. If all of them did, one could simply pay for the lease, haul in equipment and start pumping oil. But that only happens in fiction. And it happens in the minds of those who use the undeveloped-lease argument as a smokescreen to mask their intent to keep America's vast energy resources locked up underground, despite increasingly strong consumer demand for oil and natural gas.
For exploration to take place, our companies need access to the areas – offshore and onshore – that we know have the potential to produce the oil and natural gas consumers will need, if ours is to remain a viable economy in an increasingly competitive global marketplace.
Today's short-term need was yesterday's long-term opportunity. If Congress had acted on that opportunity years ago, America would not be in the energy bind it finds itself in today. Working with industry, Congress now has the opportunity to help secure America's energy future. It should not miss the chance again.
Excerpt: The environmental movement, only recently poised for major advances on global warming and other issues, has suddenly found itself on the defensive as high gasoline prices shift the political climate nationwide and trigger defections by longtime supporters. Opposition to offshore drilling -- once ironclad in places like California and Florida -- has begun to soften. Gov. Charlie Crist of Florida on Tuesday eased his opposition to new energy exploration off the coast.
"Floridians are suffering, and when you're paying over $4 a gallon for gas, you have to wonder whether there might be additional resources that we might be able to utilize to bring that price down," said Crist, a Republican. At the same time, pressure to drill is mounting. […] Much of the nation's coastal waters are off-limits to new oil and gas leasing until 2012 under executive orders first issued by Bush's father, President George H.W. Bush, in 1991 and extended by President Clinton in 1998. In addition, Congress has taken action annually since 1981 to preclude drilling in coastal areas.
Investors Business Daily – Nationalize This! – June 20, 2008
Excerpt: The first was the far-left Maxine Waters of South Central Los Angeles. During a May 22 grilling of oil CEOs, she responded: "Well, I can see that this congresswoman is going to favor nationalizing the oil companies, and making sure the prices go down."
Then, this week, responding to President Bush's call for more drilling, the just-as-liberal Maurice Hinchey of New York's Borscht Belt chipped in with: "We (the government) should own the refineries. Then we can control how much gets into the market." […] Which makes us wonder: Do they even know that socialism — state ownership of the means of production — has been completely discredited by history? For 74 years, we struggled against this evil system, and it ultimately collapsed of its own internal contradictions. Yet, apparently, many Democrats are keen to replicate its worst features here.
What's ironic about this nationalization mania is that government, specifically bad decisions made during decades of control by Democrats, is to blame for our current energy woes. Whether it's their failure to build nuclear power plants or oil refineries, their refusal to drill for our plentiful oil, their reliance on market-destroying price controls or their absurd belief that windfall profit taxes will somehow bring us more energy, Democrat-led Congresses have failed us over and over again. They've demonized oil companies for the very thing they themselves are responsible for — namely, destroying the link between higher prices and increased output of energy that would naturally occur in a functioning free-market economy.
This is a global problem, they insist. The fact is, the world's oil crisis is due almost entirely to government intervention in working markets at all levels. As we've noted before, roughly 93% of the world's oil reserves are controlled, directly or indirectly, by governments. It is they who have screwed it up. […] With oil above $130 a barrel and gasoline pushing $5 a gallon, logic dictates that we drill for more. Our oil companies will do that dirty, difficult job for us, but only if they're given access to our bountiful resources and assured they won't be vilified, taxed out of business or taken over by a U.S. House of Socialists.
Excerpt: Food riots terrify the elites much more than energy riots. Marie Antoinette was beheaded because bread, not wood or coal, was so scarce for the poor. The Roman Emperors provided free bread to a third of the population of Rome, not free wood, because they were very fearful of the hungry and jobless mob. For an increasing number of third world nations civil unrest, including violence, as a result of food and energy deprivation is now the most significant threat to regime continuity. […] The earth warmed strongly between 1915 and 1940, cooled between 1940 and 1975 and then warmed strongly again between 1975 and 1998.
The earth has been cooling in the opening years of this century even as carbon dioxide levels have risen appreciably since 1998. Many influential people in the industrialized world believe that global warming is a transcendent issue and human activity, especially the activity of the energy complex, is to blame and carbon management, at any cost, is imperative.
A growing number of influential people in the developing world (this includes China, India, Indonesia, Vietnam, as well as Russia) are openly rejecting the idea that human activity has any measurable influence on the planetary climate or even that there is anything unusual or abnormal about the climate at present.
Some of these people, joined by hundreds of scientists in the U.S. and Western Europe advance the idea that sunspot activity (which is cyclical) and the recently discovered (as recent as 1996) PDO (Pacific Decadal Oscillation: 20 to 30 year warming and cooling of the north-central Pacific Ocean) explain the cyclicality of global temperatures. According to those who hold this view, the planet has entered into a 30 year or so cooling period and carbon dioxide emissions even if they keep growing, cannot prevent this cooling. In support they cite NASA’s recent study that the global oceans are cooling and expected to cool for several years. […]
There are now two belief systems about the climate. A largely Western belief system about steady and maybe catastrophic warming and a rest of the world belief system about impending cooling. The former belief system holds human activity responsible. The latter belief system scoffs at the ability of human beings to influence climate cycles.
Belief systems, of course, drive policy and strategy which drive investment flows. Energy industry executives increasingly find themselves caught between these irreconcilable belief systems. In the West, public policy, hence corporate strategy, is shaped by the first belief system.
In the leading non-Western nations (NWNs), including Russia, the second belief system is implicitly ascendant despite official adherence (but not commitment) to the first belief system. As food and energy riots grow in Asia, Africa and later in Latin America, the second belief system will go from implicit to explicit; it will no longer be whispered but proclaimed.
Investor’s Business Daily - The Drill Vote – June 20, 2008
Excerpt: A silent transformation of the political landscape has taken place that spells trouble for Democrats this election year. With no end in sight to high fuel prices, voters want the one real solution: drill for oil. […] It turns out that House Speaker Nancy Pelosi, Sen. Barack Obama, D-Ill., and the rest of the left beholden to environmentalist special interests are finding Americans to be a lot harder to fool than they thought.
The green that consumers are most concerned with is the hard-earned cash lost while filling up because of an ideologically-driven energy policy that denies reality. Instead of viewing more domestic drilling and the construction of new refineries as ways in which the oilmen can pollute as they line their pockets, a substantial majority now want these measures implemented. […] They thought America was getting greener and that all their dreamy visions of an economy running on windmills, solar panels and corn-fed cars would make them be seen as the good guys. Costly gasoline would be viewed as the evil work of profit-gorged, conspiratorial oil executives, from whom only a Democratic president and Congress could save America.
The Hill – Webb splits with Obama over drilling – June 19, 2008
By pushing a bill that distances himself from the Democratic Party and its presidential candidate on offshore drilling, Sen. Jim Webb of Virginia is picking a curious time to exercise his well-known independence. Webb wants his home state to have the right to explore for energy off Virginia’s coast.[. . . ] A key McCain ally, GOP Sen. Lindsey Graham of South Carolina, seized on the similarities between Webb and McCain on offshore drilling. “It shows Sen. Webb is right sometimes,” Graham said.
NYT - Idea of Offshore Drilling Seems to Be Spreading – June 19, 2008
Excerpt: In the Capitol and along the coast here minds once closed to offshore drilling have been cracked open by the prospects of safer drilling technology and an awareness that dependency on foreign oil has heavy costs. “It’s something we need to do because of the bigger picture,” said State Senator Burt L. Saunders, chairman of the Senate Environmental Preservation and Conservation Committee. “We need more energy independence.”
Excerpt: At the very least, Democrats saved themselves an awkward confrontation on gas prices Wednesday when they canceled a committee vote on the Interior spending bill. Rep. John Peterson (R-Pa.) was planning to push his offshore drilling bill as a remedy for oil and gas costs, just as Sen. John McCain (R-Ariz.) and President Bush made their tag-teamed push for drilling off the country’s coastlines. But the committee markup was canceled just two hours before it was to begin. Republicans say they suspect Democrats might have nixed it because they were worried they would lose the vote or, in beating Peterson back, become part of the Republicans’ 2008 campaign storyline.
The Age - British Families Warned To Tighten Belts – June 20, 2008
Excerpt: British families' standard of living will stagnate this year while the value of their homes will fall further, the governor of the Bank of England has warned. Mervyn King said the coming months represented the biggest challenge for the economy in two decades and some households would find them "particularly difficult". In his most sombre message yet, Mr King said higher electricity and food prices and slowly increasing wages were squeezing families. […] "This year our real take-home pay will rise at a slower pace than national productivity," he said. "Rising fuel, gas, electricity and food prices mean that average real take-home pay will stagnate this year. It will not be an easy time, and I know some families will find it particularly difficult. "The squeeze on real take-home pay will arguably be an even more significant restraint on consumer spending this year than the credit crunch. And it will affect the housing market, too - lower demand in the high street will go hand-in-hand with lower demand in the property market."
Bloomberg News: - Power Price Surge May Force EU Emissions Rethink - June 18, 2009 (h/t CCNET)
A further 13 percent rise in European electricity prices, which have surged by almost 50 percent in the past year, would likely force lawmakers to lower the cost of emissions trading, said an analyst at Deutsche Bank AG. Europe needs to demonstrate that emissions trading is not too expensive, to win agreement for a global climate protection deal starting 2013, Lewis said. "Probably the last thing that a European policymaker would want to see is a price spike in the carbon market in Europe that would make other countries internationally less willing to contemplate tough carbon caps."
UK Times: Soaring Energy Prices Will Force Six Million Households Into Fuel Poverty Trap – June 20, 2008 (h/t CCNET)
Excerpt: Soaring energy prices could leave more than six million households struggling to pay their fuel bills by Christmas - the so-called fuel poverty trap - leaving in tatters government promises to eradicate the problem for the vulnerable by 2010. […] Campaigners said yesterday that the Government had failed. A spokesman for NEA said: "We are back to square one. All the progress the Government has made has been erased. It's really an unprecedented situation." […] Nick Clegg, the Liberal Democrat leader, this week called on the Prime Minister to force power companies to devote some of the £9 billion in subsidies that they will receive from the European Union's emissions trading scheme to the fuel poor.
"How can it be fair to subsidise large energy companies when ordinary families cannot pay their fuel bills?" he asked. Gordon Brown responded by saying that the Government had increased its winter fuel payment for pensioners and has negotiated an agreement with utilities to provide up to £150 million a year to help low-income families. "We are determined to do everything that we can to reduce fuel poverty in this country," Mr Brown said. "We are in a very difficult situation in which oil prices have trebled, and we are determined to do everything that we can to help the vulnerable families of this country."
Excerpt: Measurements by four major temperature tracking outlets reported that world temperatures dropped by about 0.65° C to 0.75° C during 2007, the fastest temperature changes ever recorded (either up or down). The cooling approached the total of all warming that occurred over the past 100 years, which is commonly estimated at about 1° C. Antarctic sea ice expanded by about 1 million square kilometers – more than the 28-year average since altimeter satellite monitoring began. But have these collective announcements ended the global warming debates? No, stay tuned for further developments. […]
Based upon current solar data, the Russian Pulkovo Observatory concludes that Earth has passed its latest warming cycle, and predicts that a fairly cold period will set in by 2012. Temperatures may drop much lower by 2041, and remain very cold for 50 to 60 years. Kenneth Tapping at Canada’s National Research Council thinks we may be in for an even longer cold spell. He predicts that the sun’s unusually quiet current 11-year cycle might signal the beginning of a new “Maunder Minimum” cold period, which occurs every couple of centuries and can last a century or more. # # #