Will Global Warming go the way of the Subprime Mortgage?
Posted by jennifer, September 22nd, 2008 - under Opinion.
Tags: Economics
Canadians go to the polls on October 14, 2008; just before the US federal election. Climate change was touted as a key election issue, but that was before the financial turmoil of the last couple of weeks.
According to Roger Gibbins writing in the Calgary Herald, Canadians’ resolve on global warming has cooled with the economy. Gibbins also commented that:
“The bad economic news has been unrelenting in recent weeks and there is no doubt public support for aggressive action on climate change has wilted in the face of this barrage. With ongoing woes across the border, plunging stock markets, escalating fuel costs and growing uncertainty about Canada’s economic prospects, voter support for aggressive climate change action is weakening. It is hard to concentrate on a complex climate change policy debate when financial institutions are collapsing and RRSPs are evaporating.
“The argument that aggressive climate change action is essential for Canada’s economic prosperity is not holding in tough economic times. For the most part, Canadians are proving to be fair-weather climate change supporters.”
In Australia the Rudd Labor government is planning for the introduction of an emissions trading scheme in 2010. The idea is to go with emissions trading rather than for example, a carbon tax, as the market is claimed to be the best place to sort out what the price of carbon should ultimately be, etcetera.
But I can’t see how the whole scheme is anything more than a crock, as the carbon market is entirely a creation of government regulation and therefore totally artificial.
Sure there will be those who make money as middle men, brokers for schemes where industry pays for permits to emit carbon dioxide at so much a tonne, but it is artificial, perhaps as risky as a sub-prime mortgage?
Indeed, according to blogger and Professor Emeritus, Philip Stott:
“With a world likely to cool during the next decade, with a world economy set in austere mode, and with the new politics of China, India, Brazil, and the rest, Big Global Warming’s boom days are surely coming to an end.
“Global warming’ is sub-prime science, sub-prime economics, and sub-prime politics, and it could well go down with the sub-prime mortgage.”
Here’s hoping that all this happens, before too much more damage is done.
NT
James Hansen is a republican? You have fact to back this up?
And you need to think a bit more about the difference between unhampered markets and regulated markets – in one you choose, in the other you don’t.
NT
There are two James Hansens, one if the Republican member for Utah, the other is the very liberal director of the GISS.
Thanks for that article Louis. Its good to get some history on the current crisis though I am sure that there will be other takes on it. As for James Hansen, from my memory I read on the web that he stated or implied that he was a Republican many years ago, but I can’t remember the details. Also from memory I believe that, statistical surveys of scientists have found that as a group they tend towards conservative political opinions.
Jennifer, as to your comment that we know how commodity prices are doing, surely this equates to a climate scientist saying that we know the temperature history at a particular geographical place. It is a matter then of whether climate science is better at putting this data together to produce a big picture including projections into the future compared with economic theorists abilities to give us a picture of the larger economy, etc together with future trends. I know whose big picture and future projections I would trust at the moment. Climate scientists are facing a far more tractable problem.
With business data, swings from highs to lows seem built into the system and fluctuations interest us because of our hopes to make money or save losses by paying attention to them. With global warming there is just a very slow, boring, incremental movement overlaid with noise (eg how much heat is being buried in the depths of the sea at this time due to el nino/la nina?). Such a boring trend and confusing graph by its nature will not excite the average reader and I don’t think there is any conspiracy that such graphs are not given prominence.
Louis
The role of the “meeja” is NOT to inform. Murdoch said it outright: “We are not required to educate the public” … and clearly, almost none of them do.
Watch the subliminal propaganda on the ABC TV nightly weather forecast – a map of the country coloured with harsh, scary-bear red and orange hues (oooh, it’s becoming SOO hot!)
There was a LOL period early last summer when the weather refused to obey the ‘warming” doctrine – I watched with amusement as the ABC struggled with the manifest problem of retaining those hotter-than-hell hues in the face of the populace observing the progress of a cool, wet puddle of a summer.
Sub Prime mortgages involved lending money, notionally secured against the property, to people who had, No Income-No Assets–and No Job.
What does that say about the Governments that:
a) Allowed it to even get started,
b) Allowed it to continue.
I wonder how much of the ill gotten gains earned by those involved actually found its way back into camapaign funds. ?
If this can happen with such a huge over dose of self interest and incompetence being behind it, anything is possible, including the use of corrupted science and reasoning to peddle a fairy story.
Another example of which is this:
http://noconsensus.wordpress.com/2008/09/20/online-experiment-with-the-latest-hockey-stick/
Like the article says
Just when are the scientific fraternity going to speak out and do something about the shonkiness in their own ranks.
This isnt a debate about the relative merits of a position– its just more incompetence, fraud and malfeasance.
The similarities between subprime mortgages and the GW story are disturbing.
“carbon market is entirely a creation of government regulation and therefore totally artificial”
As is the market for … oh I don’t know, taxi licenses or hotel licenses or horse racing licences. You don’t seem to realise this kind of thing has been going on for centuries; goverment grants permissions to certain parties at a price to carry out some activity for the purchasing parties’ benefit. You need some elementary instruction in the history of markets. Morons (sorry channelled G. Bird there) ….
No Graeme, as I clearly said. “I don’t have an argument”.
Not too bright are you?
Patrick B – what you describe is traditional monopoly practice – it’s been a feature of statistm for centuries.
Ianl
As I don’t listen or watch anything the ABC broadcasts on radio or tv, I suspect have been spared from brainwashing.
that’s a shame Louis – you would have missed this
http://www.abc.net.au/tv/enoughrope/audio/ep186/PROFESSORTIMFLANNERY.mp3
Malcolm,
The greatest “stick” the AGWers wield is that we are all guilty. We all create ACO2. Original sin.
We must all suffer in the name of Gaia.
Any shonkiness is perfectly allowable in this cause.
Ask James Hansen.
And Janama,
I think Louis had it right the first time.
Isn’t there a more direct link here?
Superficial analysis points to bad lending practices in the sub-prime housing sector, but this is no more than a symptom of the malaise. To find out what is really wrong we need to ask how it is that a house confidently valued at $100,000 last year is now valued at $80,000. People, staring numbly at their eviction notices are asking right now: ‘But how can this be; it’s the same house; what’s changed?’
What’s changed is sentiment, the prevailing psychology within the market. But again, herd psychology does not change on whims and fancy. Investors, in aggregate have become pessimistic over the last few years for good reasons. What is driving this negative sentiment?
Both sides of the political spectrum would probably agree that one of the key drivers of negative sentiment is energy cost. There are fundamental issues with oil supply but these have been factored into economic models for some time. The striking new driver in energy cost inflation is climate change: More specifically, the imposts, whether they are to be levied through trading schemes or taxes, that we might call the Climate Change Burden (CCB). When this factor (one, three, five percent…pick a number) is added into models already straining at the seams with ordinary inflation and increasing regulatory costs, our future value no longer stacks up: Marginal projects are shelved, margin calls are issued, loans are called in, houses are repossessed, and so on.
Climate change theory and activism has been with us for twenty years, so why are the costs only being factored in now? The answer is that the market; the hard heads, the Lehman Bros of the world; didn’t really believe the climate alarmists until recently, now they do, and the CCB has been factored into their outlook with predictable results.
The climate change consensus, the green zeitgeist, whatever you call it, has reached the economic mainstream. Ironically, Lehman Bros, itself, was one of the more preachy green institutions on Wall Street in its last days. And why would it not be? With both Barack Obama and John McCain promising bi-lateral carbon rationing measures, it would be old-fashioned, if not imprudent, for any business not to allow for the Climate Change Burden in its forecasts.
So everyone from Lehman Bros down has started putting the CCB into their mainstream models, and asset values are plummeting.
Good analysis, Jimmock.
We’re all gunna die/things can only get worse/we must make sacrifices without end is not a recipe for healthy forward looking pyschology and hence economies. Anyone remember the Jimmy Carter years?
As for McCain as reported in today’s Australian, the old warrior can do two more things for his country. Win the election on Nov 4 and then drop dead before January 20th 2009.
“No Graeme, as I clearly said. “I don’t have an argument………”.
Just so as we have that clear.
Re: Comment from Luke
Time September 22, 2008 at 11:59 am
No it didn’t – it grew out of concern for the climate implications.
+++++++++++++++++++++++++++
I’m new to this site.
My impression: no one sets much store by the pontifications made by Luke. Methinks he does protest too much.
-P.
Peter,
You’re a quick study!
“Will Global Warming go the way of the Subprime Mortgage?” Excellent question, which no commenteers seem to address (though jimmock’s analysis of a causal link between belief in AGW and the current economic crisis is fascinating). My tentative answer : maybe not, because they’re logically completely different animals.
Subprime mortgages really exist, they’re real debts owed by real people, used to maximise profits by real institutions. But no politician, or journalist or university professor has the least personal / professional investment in them. They’ll disappear because they’e economically toxic. The elimination of the multi-trillion-dollar-debt shadow economy is a technical problem, which all players hope to resolve to the benefit of all.
AGW is an idea, a myth maybe, but which has been espoused by every major politician and serious media outlet in the democratic world. (And why do so many of your bloggers see it as a leftist thing?)
But can you see those G8 leaders saying “Hey, temperatures are going down, we were wrong, lets uproot those stupid trees we planted”? Can you see a hundred editors announcing “Due to the recent fall in mean global temperatures, we are sacking our environmental editor. Henceforth, photos of polar bears and penguins will be strictly limited”? This is mass hysteria, global displacement activity, a psycho-social phenomenon unmatched since the crusades (and wasn’t that during a previous Warm Period?). History suggests that mass hysteria doesn’t wind down quietly, but dispels its energy in outbursts of horrific violence (crusades, witch hunts, religious wars). Think of the 1914-18 war. Here you colonials can provide the best evidence for the psycho-social origins of political disaster. We French and English can provide some political (ie logical) justification for committing suicide in our millions in Flanders – but you Australians, New Zealanders, Canadians…?
I have the hugest admiration for the scientists (and a small number of political and social scientists eg Climate Resistance, Benny Peiser) who lead this resistance movement. But where are the historians, psychologists, (dendrochronologists?) etc. who can help us to see our way out of the woods?
“The greatest “stick” the AGWers wield is that we are all guilty. We all create ACO2. Original sin.
We must all suffer in the name of Gaia.
Any shonkiness is perfectly allowable in this cause.”
Lies, all of it.
Think about this SJT:
AFR 25/9/08 p.21
“Merkel says key German industry sectors must be given free permits, arguing that while she supports the need to tackle climate change, she cannot support the destruction of German jobs through “an ill-advised climate policy” ”
& p.1
“More than $25 billion new mine developments are at risk of being shelved as the impact of the global credit crisis, soaring input costs and falling metal prices hit the local resources industry…….
As the rest of the country looks to the commodity boom to sustain the national economy…..”
Hmmmm.
Checked your Super lately? Any lies there?
Here is an answer to an email from a thermista in the Canadian Civil Service.
By Lord Monckton
Dear Sir Humphrey – The “Abundance of scientific statements” that you mention is no sound or logical basis for deciding or believing anything. The question is whether the scientific statements have any rational justification, and whether those making them are in effect making statements that are political rather than scientific, rent-seeking rather than objective. After all, this is the age of reason (or it was).
Therefore, one should not accord to “scientists” the status of infallible high priests merely because they mumble a hieratic language with which one is unfamiliar. There is clear, compelling evidence that many of the major conclusions of the IPCC, your new religion’s constantly-changing Holy Book, are based on evidence that has been fabricated. The “hockey stick” graph that purported to abolish the mediaeval warm period is just one example. So let me try to lure you away from feeble-minded, religious belief in the Church of “Global Warming” and back towards the use of the faculty of reason.
Let us begin with the “devastation of New Orleans” that you mention. Even the High Priests of your Church are entirely clear that individual extreme-weather events such as Hurricane Katrina cannot, repeat cannot, be attributed to “global warming”. Even the Holy Book makes this entirely plain. There was one priest – Emanuel (a good, religious name) – who had suggested there might be a link between “global warming” and hurricanes; but he has recently recanted, at least to some extent. Very nearly all others in the hierarchy of your Church are clear that ascribing individual extreme-weather events to “global warming” is impossible. Why? Well, let’s take the question of landfalling Atlantic hurricanes such as Katrina. The implication of your attribution of Hurricane Katrina to “global warming” is twofold: that “global warming” is happening, and that in consequence either the frequency or the intensity of tropical weather systems such as hurricanes is increasing. Neither of these propositions is true. Yes, there has been “global warming” for 300 years, since the end of the 60-year period of unusually low solar activity known as the Maunder Minimum (after the celebrated Astronomer Royal who studied it). But there has been no net warming since 1995, and Keenlyside et al, in the theological journal Nature a few months ago, say they do not expect a new record year for global temperatures until 2015 at the earliest. If these theologians are correct, there will have been a 20-year period of no net “global warming” even though the presence of the devil Siotu in the ether grows inexorably stronger. And, secondly, the number of Atlantic hurricanes making landfall has actually fallen throughout the 20th century, even as temperatures have risen. Indeed, some theologians have argued that warmer weather actually reduces the temperature differential between sea and sky that generates hurricanes, reducing their frequency, and that the extra heat in the coupled ocean-atmosphere system increases wind-shear in tropical storms, tending to reduce their intensity. Certainly the frequency of intense tropical cyclones has fallen throughout the 30-year satellite record, even though temperatures have increased compared with 30 years ago. Also, the damage done by Hurricane Katrina was chiefly caused by the failure of the Democrat-led city administration to heed repeated warnings from the Corps of Engineers that the levees needed to be strengthened.
Next, you mention the recent earthquake damage at Galveston, and you imply that this is something new and terrible. Perhaps you would like to do some research of your own to verify whether the High Priests of your Church, some of whom have blamed the Galveston incident on the wrath of the devil Siotu, are likely to be telling the truth. And how, you may ask, may a non-theologian such as yourself argue theology with your High Priests? Well, the Galveston incident will give you just one indication of the many ways in which a lay member of the Church of “Global Warming” may verify for himself whether or not the Great Druids of his religion are speaking the truth from their pulpits in the media. Cast your eye back just over a century, to 1906, and look up what happened to Galveston then. Which was worse – Galveston 2008 or Galveston 1906? Next, check the global mean surface temperature in 1906: many theology faculties compile surface temperature data and make it publicly available to the faithful and to infidels alike. Was the global mean surface temperature significantly lower or significantly higher in 2008 than in 1906? What implications do your two answers have for your proposition that Galveston 2008 can be attributed to “global warming”?
Next, you mention fires in California. Once again, you can either sit slumped in your pew, gazing in adoration at the Archdruids as their pious faces flicker across your television screen, or you can do a little research for yourself. It may, for instance, occur to you to ask whether droughts were worse in the United States in the second half of the 20th century than they were in the first half. Once again, you may want to check with your local theological faculty to obtain the answer to this question. Or you may like to pick up a copy of The Grapes of Wrath, by John Steinbeck. And you may want to verify whether temperatures in the second half of the 20th century were warmer than in the first half. Once again, what are the implications of your two answers for your proposition that “global warming” is causing forest fires? You could also talk to the Fire Department in California and obtain its data on the causes of forest fires. You might be mightily surprised by the answers you get.
Next, you talk of beetles in your forests destroying natural resources. Here, you could ask the Druids just a couple of simple questions. What evidence do they have, if any, that whichever species of beetle you have in mind has not wrought havoc in the forests before? And, even if your clergy think that they have evidence that the beetle-damage is new, what evidence do they have, if any, that the beetle-damage is greater because of “global warming” than it would otherwise have been? Of course, you could ask them the wider question what evidence there is that anthropogenic “global warming”, as opposed to solar warming, is the reason for the temperature increases that have occurred over the past 300 years. The more honest parish priests will admit that for 250 of the past 300 years none of the inferred warming can be attributed to human industry. They will also be compelled to concede, if you press them, that the warming of the most recent 50 years has not occurred at a rate any greater than that which was observed before, so that it is in fact very difficult to discern any anthropogenic signal at all in the temperature record.
Next, you talk of people migrating from one place to another because in some places water has become scarce. Once again, it is easy for a layman, whether a true believer such as yourself or not, to verify whether such migrations are as a result of “global warming”. For instance, you could ask whether there have been changing patterns of drought and flood before in human history. Once you have collected some historical data – most theological faculties have quite a lot of this available, though you may have to dig a little to get it – you could compare previous migrations with those of which you now speak. And you could also ask your local parish priest whether a theological phenomenon known as the Clausius-Clapeyron relation mandates that, as the atmosphere warms, the carrying-capacity of the space occupied by the atmosphere for water vapor decreases, remains static, or increases near-exponentially. Once you have found the answers to these not particularly difficult questions, you may like to spend some of your devotional time meditating on the question whether, or to what extent, the changes in patterns of flood and drought that have occurred in the past give you any confidence that such changes occurring today are either worse than those in the past or attributable to “global warming”, whether caused by the increasing presence of the devil Siotu in the atmosphere or by the natural evolution of the climate. During your meditation, you may like to refer to the passage from the 2001 edition of the Holy Book of the IPCC that describes the climate as “a complex, non-linear, chaotic object” whose long-term future evolution cannot reliably be predicted.
If you are willing to reflect a little on the questions I have raised – and, with the exception of the Clausius-Clapeyron relation, I have done my best to avoid anything that might be too technical for a layman to find out for himself – you will perhaps come to realize that there is very little basis in scientific fact for the alarmist, hellfire preaching in which your clergy love to indulge. And you may even find your faith in your new religion beginning to weaken a little in the face of the truths that you will have unearthed by the not particularly difficult process of simply checking those statements of your clergy that you can easily and independently verify. There are, of course, many environmental problems posed by the astonishing recent success of humankind. If you were concerned, for instance, about deforestation, or the loss of species whose habitats have been displaced by humans, then your concerns would have a good grounding in fact. But, given the abject failure of global temperatures to rise as the Druids had forecast, it must surely be clear to you that the influence of the devil Siotu on global temperatures – your theologians call this “climate sensitivity” – must be a great deal smaller than your Holy Book asks you to believe.
Finally, you may wonder why I have so scathingly described your pious belief in your new religion as founded upon blind faith rather than upon the light of reason. I have drafted this email in this way so that you can perhaps come to see for yourself just how baffling it is to the likes of me, who were educated in the light of TH Huxley’s dictum that the first duty of the scientist is skepticism, to see how easily your hierarchy is able to prey upon your naive credulity. I do not target this comment at you alone: there are far too many others who, like you, are in positions of some authority and whose duty to think these things through logically is great, and yet who simply fail to ask even the most elementary and blindingly obvious questions before sappily, happily, clappily believing in, and parroting by rote, whatever the current Establishment proposes. I do not know whether you merely believe all that you are told by the Druids because otherwise you will find yourself in conflict with other true believers among your colleagues or, worse, among your superiors. If you are under pressures of this kind, I do sympathize. But if you are free to think for yourself without penalty, may I beg you – in the name of humanity – to give the use of reason a try?
Why “in the name of humanity”? Because, although the noisy preachers from the media pulpits have found it expedient not to say so, there have been food riots all round the world as the biofuel scam whipped up by the High Priests of your religion takes vast tracts of agricultural land out of food production. Millions are now starving because the price of food has doubled in little more than a year. A leaked report by the World Bank says that fully three-quarters of that doubling has occurred as a direct result of the biofuel scam. So your religion is causing mass starvation in faraway countries, and is even causing hardship to the poorest in your own country. Can you, in conscience, look away from the sufferings that your beliefs are inflicting upon the poorest and most helpless people in the world?