A new framework to address overshoot

As an independent economic thinker rather than an affiliated academic, I can perhaps offer a fresh approach to our ecological predicament.

The current approach is typified by recent posts regarding cap-and-trade, including Edward Fullbrook’s request that economists evaluate James Hansen’s “fee and dividend” proposal.  These posts are attempts to reform the current system – that is, to improve on business-as-usual.  Such reforms are worthwhile, but strikingly inadequate to prevent the collapse that Fullbrook and many others rightly fear.

Climate change is clearly a major threat to ecosystems, but it is only a symptom of the underlying problem we face – ecological overshoot.  For the first time in history, humankind has violated environmental limits on a global basis.  This situation is unprecedented, and therefore requires an unprecedented solution.

Carbon credits: Britain’s richest man cleans up

The climatologist James Hansen opposes the cap and trade scenario being considered at Copenhagen on two grounds: one, at the real-world level it is essentially a programme for fraud and corruption, and two, it is essentially greenwash and thus serves to postpone, yet again, serious attempts at carbon reduction. Yesterday’s Sunday Times provides supporting evidence for Hansen assertion that cap and trade is a system for “paying off numerous special interests”. 

Update on Censorship of Critique of Emssions Trading Schemes

There have been major developments in the story (Censorship of Critique of Emissions Trading and Carbon-Offsets Schemes) about the attempts of Australia’s CSIRO to prevent Dr Clive Spash from publishing his critical review paper on  emissions trading and carbon offset schemes.  On 2 December, as reported in Nature News, The Australian and ABC Radio National, Clive decided he had been through enough bullying and resigned from his professorial-level position as a Science Leader at CSIRO. That Clive should take such a brave public stand on this matter will probably come as no surprise to Real World Economists who know him as an ecological economist of the highest principles who is concerned about the potential catastrophic irreversibility of climate change if inappropriate polices are adopted. In resigning, Clive called for

Fee and dividend vs. cap and trade

James Hansen is not an economist.  But after Lovelock he is arguably the most eminent climatologist ever and currently director of Nasa’s Institute for Space Studies.  Like others of his profession, Hansen knows that the Earth’s climate is close to tipping points and that it “is a dead certainty that continued high emissions will create a chaotic dynamic situation for young people, with deteriorating climate conditions out of their control.”

But Hansen has what he thinks may be – if we are lucky – an eleventh hour escape.  It is economic in nature.  As economists we might want to do our part and develop and promote it further.  Hansen

Cleaning house at the WTO

(with Timothy A. Wise)

This week, the 10th anniversary of the infamous “Battle in Seattle,” ministers assembled in Geneva with renewed hopes of reviving world trade talks. To dampen expectations, World Trade Organisation chief Pascal Lamy bills the event as a mere “housekeeping session,” rather than full-fledged negotiations.

There is no question the WTO needs to clean house. The organisation charged with developing a fair and legitimate multilateral trading system has been left in the dust of world economic events.

Shale gas – article yanked and editor fired

from          Lewis L. Smith

Natural gas can be extracted from a kind of low-porosity rock known as shale. Indeed shale gas is already making a substantial contribution to the US gas supply. Moreover, some very optimistic estimates have been made about the quantity which could be produced in the future, without giving any thought to the  availability of the water required to fracture this rock and release commercial quantities of gas from newly discovered reservoirs.

Indeed some people are even looking to shale gas to “save” the USA from the impact of the coming peak in world crude-oil production. In the meantime, stock in shale-gas producers is being touted to investors as “the greatest thing since sliced bread”.

However,

Banking on Heaven

Banking on Heaven: economics as confessional

 Jamie Morgan

‘I should like,’ said young Jolyon, ‘to lecture on it: “Properties and quality of a Forsyte. This little animal, disturbed by the ridicule of his own sort, is unaffected in his motions by the laughter of strange creatures (you or I). Hereditarily disposed to myopia, he recognises only the persons and habitats of his own species, amongst which he passes an existence of competitive tranquillity.”’ John Galsworthy, The Forsyte Saga.

The recent comment in the Sunday Times (8/11/09) by the Goldman Sachs CEO, Lloyd Blankfein, that banks serve a ‘social purpose’ and do ‘God’s work,’ was a controversial one. Reference to the Almighty in business and banking often leads to satirical exegesis. Many might respond that the liturgy of banks is public worship of quite another kind than might be ascribed to a divine being. Others might suggest that

Oil prices

In the markets for physical petroleum liquids, there is unprecedented speculation in favor of an oil-price increase. The speculative volume is the highest in ten years and the dollar amount involved is the highest ever. Moreover, the speculation involves both crude oil and products, especially  ”middle distillates” such as diesel, an important fuel for construction, manufacturing and land transportation. 

Political documents vs. scientific ones – #2

Comparing the graphs tells the whole story (See Political documents vs. scientific ones). A essential point not made is that the finding, proving, delineating and bringing on line of an oil reservoir takes time, typically three to ten years. So the early stages of the search for much of the production “to be found” should be visible “in the pipeline” already. Only it isn’t, at least not for Dr. al Husseini, former head of exploration and production for Saudi Aramco. As he says, “there aren’t enough projects”, and a lot of us agree with him.

Is Development Back in the Doha Round? New Policy Brief Questions New-Found “Gains from Trade”

Is Development Back in the Doha Round?
New Policy Brief Questions New-Found “Gains from Trade”

As trade ministers prepare to assemble November 30 in Geneva for further WTO talks, they are hearing another round of new and refurbished projections of how much wealthier the world might be after liberalizing trade.  The upcoming ministerial is no different, and neither, fundamentally, are the projections, notwithstanding one recent claim – cited by WTO director Pascal Lamy – that an ambitious Doha deal could deliver $300-$700 billion in global welfare gains, with the benefits “well-balanced” between developed and developing countries.

Student protests against the effects of the economic collapse are spreading

A wave of student protests, reminiscent of the 1960s, has swept across California’s university system.  Students have wagged, teach-ins, class walkouts, rallies, demonstrations and sit-ins after the state government announced

Reviews of Paul Davidson’s new book

Here are some review comments on Paul Davidson’s new book The Keynes Solution: The Path to Global Economic Prosperity [only $15 from Amazon US]. The first is from The New York Times.

“A true believer, Mr. Davidson lays out Keynesianism in easy-to-understand language and makes a strong case that it is just as relevant today. There are some doubters who fear that Keynesian spending is dangerous because it produces unbalanced budgets. Mr. Davidson responds that deficits in times of crisis lead to prosperity when the economy recovers. The most tantalizing part, however, is the appendix, entitled “Why Keynes’s Ideas Were Never Taught in American Universities.” Mr. Davidson writes