"The other striking feature is the massive growth in Green Party support - from 2% to 5% - which must attract questions as to what has prompted this."
We already knew Al Gore was wrong. That pretty much everything that made his film distinctive and emotionally compelling couldn't be justified by the evidence.
Now, it appears he's lost touch with reality entirely. He has challenged Americans to entirely end the use of fossil fuels to generate electricity within a decade (without an expansion of nuclear power). This is utter insanity. The research of the excellent Renewable Energy Foundation shows pretty conclusively that large scale renewable energy is currently unrealistic. Wind power is far too unreliable and has a nasty tendency to cut out when you need it most. Other technologies just cost too much per KWh to be remotely practical as a large part of our energy mix.
Of course, that's not to say that massive adoption of renewable power won't happen. It is possible, though unlikely within a decade, that new technological developments will achieve something remarkable. Perhaps solar power really will become too cheap to meter. There are steps that can be taken to encourage technological advance in that direction. Jim Manzi, writing in the National Review, proposed prizes that could encourage technological advance at low cost and without too much risk of interest group capture.
However, to start trying to tax people into avoiding fossil fuels now, when there isn't a practical alternative, will just push up the cost of energy. It would cost ordinary families, and particularly the poor and vulnerable elderly, a fortune and do lasting damage to industry. To try and force a switch away from fossil fuels on the timescale and scale Gore is proposing would be insanity.
Cross-posted from CentreRight.Com.
A leaked World Bank report has alread alerted us to the fact that biofuels have pushed up food prices by 75 per cent. Now, the direct financial cost of biofuel subsidies is becoming clearer. Yesterday, the OECD released a study on biofuels showing just how expensive and ineffective the subsidies are.
Government support for the industry in the US, Canada and the EU was $11 billion in 2006 and is expected to rise to $25 billion by 2015. All that will achieve is a 0.8 per cent cut in greenhouse gas emissions from transport fuel by 2015. What's really incredible is the cost per tonne of greenhouse gas emissions saved, between $950 and $1,700. These costs can quite easily be compared with the benefits.
The benefits of saving a tonne of carbon dioxide are referred to as the "social cost" of a tonne of carbon dioxide emissions. For more information on this concept see Box 1.1 in this report (PDF). We last surveyed the major academic and official estimates of the social cost of carbon dioxide emissions for the report The Economic and Political Case Against Higher Fuel Duty (PDF). Nordhaus, who the Economist has called the father of climate change economics, puts the social cost at $7 per tonne. The IPCC and Tol, another respected climate economist, studied dozens of academic estimates of the social cost of carbon dioxide emissions and the averages they reported, at $12 and $6 respectively, were in the same ballpark as Nordhaus's estimate. Finally, the estimate reported in the Stern Review was $85 per tonne. Stern's result is very different to that obtained by Nordhaus, Tol and the IPCC for reasons discussed in Box 1.3 of this report (PDF).
If we compare the cost of subsidising biofuels with what we gain by saving a tonne of carbon dioxide emissions the results are pretty stark:
The costs of subsidising biofuels are between 11.3 and 229.7 times the social cost of just burning fossil fuels and not worrying about carbon dioxide emissions. Biofuel subsidies are a waste of money and should be abandoned.
There may be a day when technological advance delivers efficient biofuels. Just as there may be a day when wind and solar plants can deliver power at a low cost, reliably and in the quantities required to make a big contribution to our energy needs. At the moment, neither biofuels nor renewables are anywhere near efficient enough to replace fossil fuels. Pretending otherwise and throwing huge amounts of subsidy at technologies that just aren't ready for the big time is a ruinously bad idea.
Cross-posted from the TaxPayers' Alliance blog.
"There is a social cost to this process, as well as a financial cost. A large proportion of those prosecuted are single parents on low incomes, for whom the licence fee is a considerable burden. To add to this burden the court-imposed fines is effectively to criminalise poverty. Almost no-one now goes to jail for failing to pay the evasion fine, but the victims of the system are often dragged back to court soon after a conviction, having fallen behind again and now finding themselves on the enforcers’ radar.
[...]
As it happens, there is an abundance of evidence that very few people would choose to do without the BBC, at a given price. Moreover, a series of studies has shown that a large proportion of the population would willingly pay more for the BBC than the current level of the licence fee, strongly suggesting that if the BBC introduced a series of channel packages, from, say, just BBC One through to the full array of current channels plus HD options and perhaps a sports channel, take-up of one or other of these choices would be nearly universal, and BBC income would rise, rather than fall, especially as each TV set would need its own smart card, allowing the cost of the cheapest package for a single TV to be as low as £5 per month.
The paradox of the present situation is that people too poor or too unwilling to pay for the BBC are forced to subsidise those who value it well above the level of the licence fee, mostly because that level is a much lower proportion of their net income than it is for the poorest. A tax-based licence fee removes that inequity, but a layered consumer proposition which is entirely voluntary gives the BBC a much stronger connection with its viewers and listeners, real accountability for the first time, and the opportunity to continue developing new services that will appeal to subscribers.[...]
First, there is a well-established public demand for high quality products: without it, publications like The Economist and the Financial Times could not exist, along with a huge array of other magazines.Secondly, the research that has been done shows that the present balance of BBC output would deliver enough subscribers to maintain the present quality of service: and as the BBC is non-profit-making and publicly owned, there should be no pressure to dilute in order to maximize revenue."
Frederick Kagan, who proposed the 'surge' at the American Enteprise Institute; John McCain, who supported the strategy when it was desperately unpopular, and most of all David Petraeus, who led the operation, and the soldiers risking their lives on the ground deserve all the credit in the world."The war continues to abate in Iraq. Violence is still present, but, of course, Iraq was a relatively violent place long before Coalition forces moved in. I would go so far as to say that barring any major and unexpected developments (like an Israeli air strike on Iran and the retaliations that would follow), a fair-minded person could say with reasonable certainty that the war has ended. A new and better nation is growing legs. What's left is messy politics that likely will be punctuated by low-level violence and the occasional spectacular attack. Yet, the will of the Iraqi people has changed, and the Iraqi military has dramatically improved, so those spectacular attacks are diminishing along with the regular violence. Now it's time to rebuild the country, and create a pluralistic, stable and peaceful Iraq. That will be long, hard work. But by my estimation, the Iraq War is over. We won. Which means the Iraqi people won."
Today we learned that:
"Ministers are to build eight new nuclear power stations across England, the Daily Telegraph can disclose."
I'm pretty confident that even if the entire 135-strong payroll vote (PDF) is mobilised that won't quite be enough to get eight nuclear power stations built. Beyond the obvious labour shortages I'm not sure that ministers' careers in the unions, journalism or the law have left them with the expertise to produce a functioning nuclear power plant.
Of course, in reality ministers are only providing planning permission but the underlying attitude, that things get done when ministers command that they be done, is dangerous. An attitude which expects Government to take action and interfere from the top in the day-to-day delivery of services is responsible for so much poor performance in the public services.
Energy policy, over the last decade, has been an utter disaster. John Constable, of the Renewable Energy Foundation, in an article for Power UK, Is the future of UK electricity dark, dirty and costly? (PDF), highlights how bad the situation has become. He suggests another approach, where ministers are far less interventionist:
This disingenuous inteventionism has combined with complacency towards the flaws in the electricity market system (BETTA) and resulted in a decade during which many billions of pounds of assets have been written down, the nuclear industry almost bankrupted, and an imprudent over-commitment to gas generation compounded.
In my view the only way of ensuring rapid remedial action is for government to actually rather than apparently withdraw from the system, so liberating energy market participants to respond commercially to the situation as it now stands. This opinion is not informed by doctrinal libertarian affection for the free market but rather a practical recognition that no government or any single market participant can gather and assimilate sufficient information to design and realise a satisfactory outcome. Only the intellectual action of the market in aggregate, and through competition, has a reasonable chance of producing an optimal result.
Cross-posted from the TaxPayers' Alliance blog.
To the right is the pattern of UK carbon dioxide emissions since 1990 so far. Between 1990 and about 1993-94 there are significant cuts. This is almost certainly connected to the recession at the time. Carbon dioxide emissions are so intimately connected to economic growth that recessions often lead to reductions. The collapse of Eastern Europe's manufacturing base probably brought emissions down more than any other global phenomenon of the past few decades. We may see emissions reductions right now, when the data comes through in a couple of years time, connected to the current slowdown. The early nineties reduction was also, more importantly, driven by the shift to gas, something that can only be done once and might need to reversed if gas imports are imperilled. One more reason why ensuring energy security and cutting emissions don't necessarily go together.
We haven't cut emissions since 1995. Since 1997 emissions have actually increased by 1.6%. All this fuss over targets, whether binding or not, is pretty meaningless. The actual policies that have been put in place over the last ten years have increased the price of electricity (Ofgem estimate (PDF) that they make up 8% of the average household energy bill), pushed up the cost of motoring, increased the price of family holidays and otherwise cost taxpayers a fortune. Petrol prices have almost doubled since 1995 and, at the same time, emissions have kept on rising suggesting that the elasticities involved are incredibly low.
Despite all of the innumerable policy initiatives and market incentives to reduce energy use emissions have gone up over the last ten years. Clearly, there is some deeper difficulty to cutting emissions that the greens have not acknowledged. People really do need and/or value the activities that create emissions. Emissions probably will fall if fuel prices stay as high as they are but it'll be slow and steady. There is something deeply decadent in coming up with target after target while ignoring that basic issue.
Not to mention the G8's pride in setting targets without the developing economies. Even if the developed economies were to completely decarbonise then, to make a 50% global cut by 2050 from present levels the developing economies would need to make 46% cuts to their 2050 emissions. If the developed economies can only get a two thirds cut by 2050 (very, very ambitious as the graph above shows) then the developing world would need to cut their 2050 emissions by 74% (all these facts are from a White House Council on Environment Quality presentation). This would mean huge sacrifices in economic growth.
It's hard to escape the conclusion that these targets do not represent anything but meaningless moral preening.
On another note, over on my personal blog I discuss why the idea that an oil-money conspiracy is keeping the green 'truth' from the people is so deeply wrong.
Cross-posted from CentreRight.Com
If there is one message that emerges loud and clear from environmentalist propaganda, whether Al Gore’s rhetoric, green protests or dramatisations like Burn Up, it is a clear idea of the enemy: Rich, slick oil executives who supposedly fund some vast conspiracy to prevent the emerge of a brave, green new world. They form a handy target for a movement that is deeply anti-capitalist. They’re often American, wealthy and clearly have some measure of power; fine bogeymen for the modern age.
There is no vast conspiracy to prevent the public accepting the green agenda. There are millions upon millions of pounds being spent in the UK alone attempting to convince the public that it should be a priority to cut carbon dioxide emissions. The Government’s Act on CO2 programme alone has cost £5.5 million in the last year. Government departments and NGOs run countless other programmes with large staffs and sizeable budgets. By contrast, I’m not sure there is anyone working full-time in the UK to argue the case against radical carbon dioxide emission cuts. A cursory examination of their advertising shows that Exxon Mobil, BP and the other energy majors are not working to combat the idea that we should take aggressive action to curb carbon dioxide emissions. Instead, they’re kowtowing to the greens.
There is, simply, a free-rider problem which means corporations will rarely resist significant political pressure. The benefits from fighting green alarmism are diluted across such a range of firms and interests while the costs, in terms of green opprobrium, are not. Exxon Mobil initially funded sceptical scientists to a certain degree but the amounts were small compared to the budgets the green movement are playing with and that effort is now largely over. Firms respond rationally and don’t defend the broad social benefits of, for example, affordable energy.
Beyond that “Big Oil” isn’t going to be the big loser – in absolute terms – if green policies are put in place. The crucial measure here is reserves. Green policies won’t bring down prices right now so current production isn’t the crucial variable. Reserves are the crucial measure of the potential impact of green policies, were they to be successful in reducing demand for hydrocarbon fuels, on a firm. On that score the Western oil companies are minnows. Measured by reserves, Exxon Mobil is the 14th largest firm, BP 17th largest and Shell 20th. The lion’s share of world reserves are held by nationalised companies, with Saudi Aramco at the top of the list. These are the firms who will really lose out if hydrocarbon demand falls.
Of course, the argument that comes up at this stage is that we have to cut hydrocarbon demand in order to stop Iran, Saudi Arabia and other unpleasant regimes enjoying buoyant revenues that allow them to spend on weapons, promoting radical Islam and other unpleasantness. This is an argument which receives far too little scrutiny. You don’t need to ask too many questions to see that it is full of holes. The argument relies on the idea that people are less dangerous when they’re poor; that poverty actively makes people less likely to engage in terrorism.
While I don’t subscribe to the argument that terrorism is some kind of cry for help from the world’s poor neither do I think that it is dependent on serious wealth. In a world where a state as poor as North Korea can develop nuclear weapons poverty is clearly little bar to an ability to inflict terrible carnage. Our enemies must be resisted and defeated and our potential enemies persuaded. Reducing our use of oil will do little to help and if we impoverish ourselves in the process it will make things more difficult.
Of course, all this assumes that green policies will succeed in significantly reducing hydrocarbon demand. In the meantime, the main effect of green policies, if they hope to have a significant effect, has to be higher energy prices. The real impact here won’t be on energy companies, who can generally pass such costs on, but on a broad range of Britons. Particularly the vulnerable elderly trying to heat their homes; manufacturing industries trying to compete with foreign industries that are less efficient but have lower energy costs; motorists in suburban and rural areas who need their cars to get around.
These aren’t the favoured rhetorical targets of the green movement. They’re rather harder to demonise. However, they, and not the Western oil executives portrayed in countless green caricatures, are the real losers when green policies push up energy prices.
"The third is the soundbite “The UK is well placed to ride out this international storm”. The BBC dutifully puts into bulletins that the Credit Crunch was made in the USA, and this is an international problem. They should instead ask some of the following questions:
1. Wasn’t Northern Rock a British collapse, based on the UK mortgage market?
2. Didn’t nationalisation of the Rock remove the most aggressive large mortgage lender from the market, intensifying the mortgage squeeze?
3. Isn’t the boom-bust in UK property prices and housebuilding a UK phenomenon brought about by British monetary policy?
4. Isn’t the UK government in a bad position, having borrowed and spent too much in the good years and now unable to reflate the economy with tax cuts?
5. Didn’t the UK government use off balance sheet vehicles and creative credit devices itself on a large scale, fuelling the credit boom of recent years?
6. Hasn’t UK competitiveness declined significantly in recent years, making UK adjustment more painful?
7. Why did the UK fail to add more to non fossil fuel electricity capacity during the good times, to ease shortages now?
8. Why does the UK impose some of the highest taxes on oil products, and increase them during a period of sharp upward movements in oil prices, exacerbating the squeeze?
9. Why did the government increase North Sea oil taxes, putting companies off from more exploration and enhanced recovery?
If they asked some of these, they might see that repeating uncritically the notion that this is entirely a US or international problem is just not the case. The UK dimension to this crisis reveals serious flaws in the conduct of policy in recent years."
"Ultimately, the moral cowardice of the intellectual and political elites is responsible for the continuing social disaster that has overtaken Britain, a disaster whose full social and economic consequences have yet to be seen. A sharp economic downturn would expose how far the policies of successive governments, all in the direction of libertinism, have atomized British society, so that all social solidarity within families and communities, so protective in times of hardship, has been destroyed. The elites cannot even acknowledge what has happened, however obvious it is, for to do so would be to admit their past responsibility for it, and that would make them feel bad. Better that millions should live in wretchedness and squalor than that they should feel bad about themselves—another aspect of the frivolity of evil. Moreover, if members of the elite acknowledged the social disaster brought about by their ideological libertinism, they might feel called upon to place restraints upon their own behavior, for you cannot long demand of others what you balk at doing yourself."
This feels like some kind of horrible joke:"Burn Up is a nail-biting two-part thriller for BBC Two from the pen of multi-award-winning writer Simon Beaufoy (The Full Monty). It's a powerful story of love, commitment and divided loyalty… a thriller in which the stakes couldn't be higher.
[...]
This topical thriller sees oil executives, environmental activists and politicians collide in the battle between economic success and ecological responsibility.
[...]
Neve Campbell plays his colleague Holly, whose covert collaboration with environmentalists puts her in great jeopardy, and Bradley Whitford plays Tom's best friend Mack, a charismatic yet unscrupulous oil industry lobbyist.
Burn Up follows the trio's lives and loves as they hurtle towards a global climate change summit."
Somehow, I think a fair portrayal of the global debate over climate change policy is a bit unlikely. Will the debate over what to do be cast as anything other than a black and white moral issue largely ignoring the human cost of pushing up the price of energy? Will the programme reflect the fact that 'green' campaigners are far better resourced than sceptics? Will anyone opposing climate change alarmism have any motive that isn't purely mercenary?
After Live Earth and the planned Planet Relief no one can seriously argue that, on this issue at least, the BBC's political approach is anything but that of a left-wing pressure group. One funded, at vast expense, by the taxpayer.
Update: Here's the trailer from, I think, Canada (looking less classy than the one the BBC ran before Newsnight):
Apparently, they can't find a network interested in the States. Given how desperately bad it looks that's hardly a surprise. The BBC wouldn't let some minor issue like quality get in the way of their crusade though, would they?
There are clearly two halves to this equation. The academy's influence on the outside world and outsiders' influence on the academy. I'm going to consider these separately as I'm not sure that they have waxed and waned simultaneously.
I'm not sure that scientists and academics really do have less influence on the world than they used to. Gracchi's main example here is Sir Alan Sugar:
"Sir Alan Sugar's derision for academics on the Apprentice is well known- the worrying thing is that such a bigot is advising the Prime Minister of the day."
I think Sir Alan's words could be heard from the mouth of practical entrepreneurs troughout the ages. What distinguishes contemporary business is how rare that attitude has become. Alan Sugar is retiring and one of the last of his kind; the poorly educated practical businessman is a dying breed. As more senior managers have been to university they are increasingly comfortable making use of academic expertise.
Few manufacturing companies are run without scientific expertise, either internal or bought from outside in some way. The basic methods of the social sciences are used in all kinds of businesses to varying degrees of sophistication. In the political world we're always looking to enlist science to our various sides. Even in debates like abortion where science doesn't really have a lot to offer.
I'm not saying the academics have it all their way, they never have and shouldn't, but they've probably got more of a voice now than they ever have.
The outside world's input in the academy
It's here where I do think there has been a decline. Gracchi cites Machiavelli, Gibbon, Le Carre and Cicero. You could just as easily cite examples from the natural sciences such as Priestley or even Einstein. Amateurs have made serious contributions to academic thought. It's hard to think of many examples of such amateur scientists today.
I think this change is driven by a rise in the amount of commitment, effort and particularly resources that are necessary to engage with the academic debate. The bar to serious academic investigation has risen over time for a number of reasons:
1) The onward march of empiricism. An ever increasing tendency to try and quantify everything means that there is a need to assemble and analyse data. This requires a set of specialist skills that most people don't have.
Even if you do possess those skills, or have the time to learn, it also requires access to data and software. While there are enough sources of free data for an amateur to do some great work they are at a serious disadvantage (even supranational organisations like the OECD charge for many of their sources) and the software used to perform sophisticated analyses can cost thousands of pounds.
2) The academic firewall. The best way to get involved in the academic debate is to read journals. Unless you have access to a university library or can focus on a few key publications this is practically impossible. You would have to buy so many to get a good grasp of most important subjects that the cost would quickly run to hundreds of pounds. Unfortunately, the charge for most journals operates quite effectively as a cover charge keeping out the amateur.
3) The increasingly narrow focus to academic research. I think there has been a movement towards research in narrower areas. Few academics are looking at the 'big picture' these days and most choose a small area in which to try and shed some light. I have one friend who has just completed a PhD studying religion in Cromwell's army, another who is studying the campaigning methods of a single American Senator. This all has to be rather bewildering for an outsider.
It isn't good for any institution, even one as fine as the university, to operate without outside input. Outsiders can bring fresh ideas and new perspectives that improve everyone's work.
In America, in particular, there is something of a solution. In the social sciences think tanks support work at, or near, academic standards. Research and development units at the corporations and in the military undertake significant research at the applied end of the natural sciences (Microsoft's work on quantum computing and the development of the Internet at DARPA shows how advanced this can get). Outside organisations replace amateurs as external influences on universities.
In Britain we are less fortunate. A smaller portion of our GDP is spent by British firms on research and development but the biggest divide is in the think tanks. Anthony Browne, head of Policy Exchange, wrote an interesting article for the Spectator setting out the sheer difference in scale. I was in Washington recently and noticed much the same thing. He focusses on their influence, longevity and scale but I've always been struck by the intellectual depth of their work. This article, by Donald Kagan (who I believe is also responsible for the idea of the 'surge') is a great example. Whether or not you agree with it that short piece is an incredible example of the kind of work the American think tanks sponsor. British think tanks don't have the resources to produce the same sort of output.
All this creates a problem. We have lost amateur intellectuals without enough of a replacement. British intellectual life is definitely poorer for that loss.
"Pakistani police say at least one person has died after a string of bombs exploded Monday in the southern city of Karachi.At least 25 others were injured when six small bombs were detonated within an hour of each other in neighborhoods dominated by ethnic Pashtuns."--
"A banquet fit for a 'martyr', this is how one of the July 7 suicide bombers was remembered today.
On the third anniversary of the terror attacks which killed 52 people and injured many more, the family of Shehzad Tanweer held a party to ‘celebrate his life’ and ‘remember him as a martyr’."
Stage 1: Data analysis using government figures about costs of
different crimes, broken down by region to derive a cost per head of crimes in
that area
Stage 2: (Mumble, mumble)
Stage 3: Therefore we need to cut bureaucracy and elect local police
chiefs, just as the Conservative Party want
Wasted food isn't to blame for high food prices, so why is Gordon Brown intervening in the kitchen?
Ordinary people do waste food. The efforts of environmentalists have made things worse by discouraging the use of packaging that prevents spoilage. A large part of the problem is simply that people are more likely to buy their food in a large weekly shop (due to long-term societal changes such as the increase in the number of women working) and have to estimate how much they'll need. They'll err on the side of having enough when food isn't that expensive, and another trip to the shops is an inconvenience, and food will be wasted.
However, with prices rising people will be more cautious and wastage should decrease. It isn't a significant problem that needs a political solution. Neither is it the cause of the current rapid rises in global food prices. The reason why Gordon Brown has suddenly decided this is an issue he should address isn't that he seriously thinks a sudden outbreak of wastefulness is making a major contribution to rising food prices. He's trying to send a message to hard-pressed families grappling with high food prices that he isn't to blame; it's their fault. If this doesn't work he'll probably move on to attack the supermarkets.
Brown is hoping that he can create enough of a distraction for voters to miss that it is the politicians who are the real problem. Here are five ways, among others, politicians contribute to high food prices:
Cross-posted from the TaxPayers' Alliance blog.
Today a new report I've written titled The Cost of Crime (PDF) has been released. It uses Home Office studies of the national cost of crime, and their estimates of the average cost per incident, along with crime statistics provided by police forces in response to Freedom of Information requests (unfortunately...)."It is true that big firms are typically publically quoted. But this is because they have huge capital requirements which can only be met by external shareholders. But these are only a minority of all firms."
"And what Matthew hasn't done is successfully controvert the idea that public services - schools and hospitals - should become some type of co-operative organizations."
"Some looked nostalgically back to the age of the nationalised industry, without any great belief that the present Labour government would want to revisit that approach. It is curious how nationalisation still has a grip on their hearts, when the nationalised industry under governments of both parties so let down the mining communities. The 1970s Labour government was in the business of closing mines and sacking miners, just as the subsequent Conservative government was. Each of those governments did so on the advice and at the command of the nationalised industry, which systematically failed to make mining economic enough to sustain a decent sized industry in the UK.
The miners of Tower Colliery proved the Coal Board wrong when they took over their mine and worked it profitably when the Coal Board management had wanted to close it on the grounds that it was uneconomic. Why would we want to go back to management like that? Isn’t the future a more mechanised, safer industry where those who mine the coal share in the profits?"
The question of how a firm should be organised, not to mention why they exist in the first place, is interesting and the answer varies with circumstances. Firms are organised in different ways in response to differing technologies, resource endowments, capital requirements, labour markets, consumer tastes and government regulations - among other things. The best instincts of an economic liberal scream at them to love the sheer variety of it all.
