Doug: Global warming. People like my fanatical neighbors here in Aspen seem perfectly willing to undo centuries of progress because they are completely delusional about global warming. The People’s Republic of Aspen is an epicenter of political correctness.

L: Don’t hold back, Doug, tell me what you really think.

Doug: [Chuckles] Global warming is the most prominent form of mass hysteria raging across the world today. Kids in school these days are almost afraid to breathe, because it will “increase their carbon footprint.” It’s quite amazing, the way carbon, the element all life is based on, has replaced plutonium as the enemy-element. It’s as if the chattering classes are making war on the periodic table of the elements.

Meanwhile, they’ve been changing the cry from “global warming” to “climate change” because there’s so little evidence there’s actually any warming going on. I believe that as little as a decade from now, global warming will be recognized as one of the greatest swindles in world history. It has so little scientific basis, it can only rationally be considered a political scam.

L: If that’s true, will the scam ever be revealed? There was a silly movie – I believe it was called “The Day After Tomorrow” – in which global warming caused the world to suddenly freeze over. If people are willing to think that’s possible, and the only thing certain is that things will change, and any change can be blamed on people, perhaps the con job can be maintained indefinitely. It could become a perpetual guilt trip aimed at the population, just as useful as the one certain churches used for centuries to control people.

Doug: Yes. I think Roseanne Rosannadanna of Saturday Night Live said it best: If it’s not one thing, it’s another. It’s always something.

There’s a professional class of hysterics in the world. They are the same type of people who were walking around in the Middle Ages in sack-cloth, throwing ashes on themselves, saying that the world was going to come to an end.

The world will come to an end, of course, maybe even before the sun dies in about five billion years. But these people have no perspective at all. They don’t realize that the earth is just an insignificant ball of dirt, in a nothing/nowhere star system, in a nothing/nowhere galaxy – of which there are billions, each containing billions and billions of stars. And that’s just in this universe. There’s reason to believe that there’s an almost infinite number of universes like ours, with new ones being created virtually every second.

And these people are worried about changes in the biosphere of this one, tiny little planet. To me, it makes no sense.
But dropping from the sublime, cosmic scale down to the local level, it’s still completely ridiculous.

L: Okay, let’s talk about that. What are the facts? How ridiculous is fear of climate change?

Doug: Contrary to the blatantly untrue statements these people make about the science being “settled,” if the science indicates anything at all, it indicates that anthropogenic global warming is not significant. Remember, the question is not so much whether there is any warming – which is another question – but whether human activity is a major, or even significant, contributing factor to global warming.

Of course men can have an effect on the planet. We have wiped out numerous species that we know about, just in historic times, like the dodo, the passenger pigeon. And we almost did in the North American bison. Of course we have an impact, and people do make mistakes. It’s unfortunate. And because of the butterfly effect (because of quantum effects, tiny changes can have huge consequences, such as a butterfly flapping its wings on one side of the world resulting in a hurricane on the other side), humans could have a big effect on climate change – but so could everything else. The point is that there are other factors that have orders of magnitude greater impacts on the earth’s climate, things that are tens, hundreds, and thousands of times more important to the climate than anything mankind can do – perhaps even including a major nuclear war.

Fear is being used by the political class as an excuse to accumulate more power and self-importance – and collect a lot more taxes to support their agenda. Instead of being stampeded into the dark fantasy, we should focus on increasing our wealth and our knowledge. Eventually, mankind’s fate will depend on our technological advancement. Nature teaches us – not that many environmentalists listen – that we need to colonize the rest of the solar system, and beyond. Mankind must diversify, so all our eggs aren’t in one planetary basket.

But as an aside, I have to say I’m not sure I care if mankind is going to survive – I’m not sure why anyone should care, since most of us aren’t going to live more than three score and ten years anyway. Perhaps the world ends when we end… Mankind’s future seems beyond any individual’s concern, at least beyond the lifespan of your immediate friends and family. Too much worrying about things beyond your control can turn you into a busybody.

L: You’re speaking as one with no children. Having children, I have a different view on that.

Doug: How about your great-great-grandchildren, whom you’ll probably never meet?

L: I’m not so sure about that. Life is already longer than it has ever been in history, and medical technology keeps advancing. And that’s not even getting into nanotechnology. I believe my generation may live for centuries, aside from violent death and acute, fatal illnesses.

Doug: Well, I’m sympathetic to that view. But the morality of caring for one’s posterity is a philosophical issue we can perhaps discuss another day. For now, I’ll say that I don’t like to think of myself as a survival machine for my genes – so I don’t give a damn what happens to my genes. I have my own plans. The consideration I would have for my children, if I did have any, would be reserved for those who earned it as individuals, not just because they’re my children.

L: I recall your Roman attitude about that, but that’s also a conversation for another day. Back to global warming… it’s been a while since I’ve researched this, but I seem to recall that the latest actual science is that there has, in fact, been some warming recorded in the Northern Hemisphere over the 20th century, but there’s insufficient data on the Southern Hemisphere, and the warming has been less than the global-warming models predicted.

Doug: Well, as I understand it, for the last five years or so, it’s been getting cooler, not warmer, and that’s entirely apart from the fact that back in the 1970s, all the magazines were showing pictures of glaciers toppling over the buildings of New York, because we were going into a new ice age. Even measuring the temperature is problematical, since many historical sites that were once isolated are now surrounded by civilization. It’s impossible to cover all the bases in a brief conversation like this, because there have been volumes and volumes and volumes written on this.

But look, the climate on this planet has been changing since Day One. When the solar system was formed, our best guess is about 4.2 billion years ago, things were very, very cold – as cold as deep space. Then, after the sun ignited, things got very, very hot. And, in essence, things have been cooling ever since.

Remember, there have been numerous ice ages, starting with a first period of glaciation thought to have occurred about 2.3 billion years ago, during the early Proterozoic eon, after the appearance of oxygen in the earth’s atmosphere. There was one that lasted over 200 million years, from about 850 to 630 million years ago, called the Cryogenian period, in which the ice caps may have met at the earth’s equator, covering the planet completely. Geologists actually define the earth as being in an interglacial period of the most recent ice age (the Quaternary glaciation), which started about 2.6 million years ago, during the late Pliocene. Ice sheets have advanced and retreated every 40,000 to 100,000 years or so, with the last glacial period, which covered North America and Europe with glaciers thousands of feet thick, having ended only about 10,000 years ago. So it’s no surprise that the climate has been generally warming since then.

So, the climate has gotten hotter, then cooler, hotter, cooler… And for the last 10,000 years or so, it’s gotten warmer. That’s the fact of the matter – and generally, warmer is better. The whole of the earth’s existence is marked by changes in climate. It happens naturally.

L: Why?

Doug: There are lots of reasons. One is cosmic rays, which is to say, radiation coming from billions of stars, light-years away. Cosmic rays have a huge impact on cloud formation. And cloud formation has a huge impact on the climate.

A second reason is changes in the ocean and its currents. The ocean has vastly greater mass than the atmosphere, so it’s a far greater heat-sink, and its currents have a major influence on climate.

Another is volcanism. Just in historic times we’ve seen major climate impact from volcanism. For example, there was Mt. Tambora, the most powerful volcanic eruption in history, which happened in April of 1815, killing thousands of people directly and tens of thousands indirectly through starvation. The eruption altered global climate so dramatically, 1816 became known as The Year Without a Summer, as crops and livestock around the planet were wiped out. Just one of these big eruptions, by the way, can dump more toxic pollutants into the atmosphere than man has created in the entire industrial age.

L: I happen to have been kicking rocks recently in a caldera in Idaho that was the location of the last eruption of the Yellowstone hot spot, before it blew the current Yellowstone caldera into existence. By way of comparison, Mt. St. Helens blew 0.7 cubic kilometers of rock into the air, covering half of Washington with four inches of ash. The eruption that created the caldera I was standing on blew about 1,000 cubic kilometers of rock into the air. Such an eruption, today, I was told, would kill everything as far away as Chicago.

Doug: Right, and imagine all the gases that would go with that. Sulfur compounds and the like – you want to talk about ecological disasters! And these ninnies are bicycling and recycling to save the planet from our puny little smoke-stacks. When something like the potential volcano under Long Valley caldera at Mammoth Lake in California or the Yellowstone caldera blows – and that could be two years from now, or two thousand years from now, nobody knows – it’s anticipated that these will be among the largest volcanic eruptions ever. And that’s just picking two in North America.

L: I remember a park ranger in Yellowstone telling my family that, in geological terms, the next Yellowstone eruption is overdue.

Doug: Yes, and there are other situations like that. Consider the near statistical certainty of the earth encountering a piece of space debris large enough to have an impact on the earth’s climate. The last one we know of was the Tunguska event in 1908, which is thought to have been caused by a meteor only a few tens of meters across and still leveled almost a thousand square miles of trees.

Worse than sticking their heads in the sand about this, these people are trying to stop science from progressing, ruining everyone’s lives in the here and now in the process. They think they are saving the planet, but in the end, the planet’s fate is out of our hands, and their obstruction could keep people from getting off this planet while they can.

But we haven’t talked about the main thing – and really, ultimately, the only climate change variable that really matters – which is the sun. Relative to the sun, everything else is totally trivial. Which, much as deluded believers in the omnipotence of the state might not believe, is beyond the power of human governments to regulate. To me, this is really the proof that the whole climate change thing is just a scam perpetrated by the ill-informed and ill-intentioned on the ignorant and the credulous.

L: What, specifically, does the sun do that swamps other effects?

Doug: The sun has a number of cycles it goes through, the sunspot cycle, for example, that have a huge impact on the earth’s climate. The sun is essentially all that keeps the earth from being an iceball a few degrees above absolute zero, so any change in it has major consequences for the earth.

The climate change people forget that within this pattern of warming and cooling, modern man only really came on the scene in the warming period after the last period of glaciation ended 10,000 years ago, and civilization has only been around for less than 5,000 years – which has generally been a period of global warming. Interestingly enough, the collapse of the Han Dynasty and the Roman Empire coincide with a period of global cooling, resulting in what’s commonly called the Dark Ages. And then we had the medieval warm period – when wine was grown in England and crops in Greenland – that ended with the Renaissance. Fortunately, technology had enough momentum by then that we kept advancing through the Little Ice Age, which ended only about 150 years ago. Things have been warming up since then.

Global warming hysterics generally have limited scientific knowledge, and of geology and meteorology in particular. Their belief is not science; it’s more akin to religion. The main epicenter of hysteria is not the scientific community but seems to be Hollywood. The charge is being led by actors and celebrities given free access to the pulpit by the talking heads on the various entertainment media – and you’re kidding yourself if you don’t think news shows are primarily entertainment. Through the intellectual lightweights that populate most of our classrooms, their ideas spread to our kids, and they filter up from the kids to their parents, who end up feeling guilty about something they don’t understand.

One of the worst things about all this is that it may in the future discredit science itself in the eyes of the common man. When it becomes clear to everyone that the whole global-warming scare is as silly as the tin-foil hats of the 1970s, people could mistakenly think that science itself is silly, because of all these people claiming science proves that anthropogenic global warming is real.

L: Well, maybe. But people don’t believe the sun revolves around the Earth anymore either. Lots of “scientific” notions change without damaging science itself.

Doug: True enough. But unfortunately, anthropogenic global warming has become the scientific issue. And worse, today most funding for science comes through government. That means that you have to be known to be sympathetic to conclusions that are acceptable to the political classes. It’s a shameful thing, and many scientists will deny it, but a lot of today’s research is politically biased. They like to think they are unbiased, but they all know what’s more and what’s less likely to get funded – and what politically incorrect words at conferences and budget meetings can get funding cut. It’s only human for such opinions to have an effect – which is why scientists use double-blind experiments when the beliefs of the researchers themselves can sway the outcome of experiments.

If you don’t robotically accept and parrot the “fact” of anthropogenic global warming, you’re looked upon as the moral equivalent of a holocaust denier. I’ve heard members of the chattering class actually come out and say things like this.

L: But this is science. In spite of the peer pressure and such, shouldn’t the facts lead to correct conclusions?

Doug: They should, but science is no longer the province of individual researchers. A rich amateur could be, and often was, a scientist back in Ben Franklin’s day, simply because it amused him. That afforded a great degree of independence. Today it seems to take billions of dollars to study almost anything, and the state is the center of big money these days. The result is that science is no longer run by scientists; it’s run by politicians – or to be more precise, by bureaucratic administrators who dispense money according to their own agendas.

L: So, would you say that in this environment, the peer-review process has become counter-productive, and now, instead of assuring standards, it assures desired answers?

Doug: I believe the peer review process has probably been corrupted. People are afraid to say things, to consider hypotheses unbiased research might support, because it’s become such a politically charged atmosphere.

L: They could lose their funding.

Doug: Exactly. So anything and everything you listen to on this subject of climate change – including what I’m saying today – is something you should investigate and analyze for yourself. Draw your own independent conclusions. But if you draw the conclusion that anthropogenic global warming is a fraud, you may find yourself reluctant to say it in public, for fear of being hunted down as a heretic and ridiculed by the hoi polloi.

L: Perish the thought that they might come to the conclusion that a little global warming might be a good thing. Coasts might change a bit, but you’d have longer growing seasons and more food for everyone…

Doug: Right. And – gasp! – people might not need to burn so much fossil fuel to keep warm in the winter, cutting back on pollution. Who knows? Look, no one can predict whether the earth will be cooler or hotter next year, let alone do anything to change it. If you’re afraid of global warming, turn off the lights when you leave the room – but don’t participate in the corruption of science, don’t scare our kids with unproven cataclysmic theories, and don’t try to ban economic energy sources that people living on this planet depend upon today. And don’t try to stop progress; it’s the only hope the earth has of seeing clean industry, short of exterminating mankind.

L: Well, I did ask you to tell us what you really think…

Doug: You know I would have anyway.

December 28, 2009

Climate and the Fate of Humanity was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

As a researcher who likes to chase down facts, I know that credible scientists continue to debate whether and how much humans really do contribute to global warming. However, it’s the rare politician who acknowledges this controversy. Instead, they join the herd of scientists and pseudo-scientists who tend to cherry pick among the findings to fit their preconceived conclusions. An unfortunate state of affairs, but, alas, a consequential one, because these same politicians are awfully fond of regulation — and they’re becoming more so.

So it’s not surprising that we are on course for a real mess in terms of government regulations concerning carbon emissions, taxes, tariffs, and such. Detrimental results are likely for certain sectors of the economy, such as the oil and coal sectors and associated refiners, heavy industry, and the transportation sector.

As a scientist, I currently accept the near-unequivocal evidence that Earth is in a warming spell, but I also know that in past geological times, there have been many such periods of warming and cooling. I remain on the fence as to what impact anthropogenic (human-sponsored) emissions are having on the global trend. Perhaps more importantly, at some level I am haunted by the belief that even if we are responsible for global warming, we are too late, and there is nothing we can do about it.

Pragmatically, our job here is to point our subscribers toward prudent investments, and it is pretty clear that there is opportunity and danger in industry that is regulated, subsidized, and penalized by government. It’s also clear we are just now at the beginning of what will be pronounced government intervention — for example, the U.S. House of Representatives bill (H.R.2454) aimed at reducing U.S. greenhouse gas emissions 17% from 2005 levels by 2020 and 83% by 2050. The bill allows tariffs on carbon-intensive goods (such as steel, cement, paper, and glass) if they are produced in countries the United States judges to be shirking their responsibility in reducing greenhouse gas emissions.

Herein lies the problem, even if you believe cutting emissions will make a difference: the new big greenhouse gas emitters (i.e., China, whose growing use of coal recently pushed it to the #1 spot in greenhouse emissions, with India rushing to catch up) must curb their emissions… but in doing so, they will be denied the standard of living that in theory those of us who screwed up the atmosphere in the first place enjoy. This is hypocritical, and the hypocrisy is not lost on the developing nations. That’s why I think that global accords on emissions are not going to work.

Going forward, I see the impact of climate change regulations – tariffs, taxes on emissions, subsidies, carbon credits, and carbon trading – becoming a major factor in not only the energy sector but also the associated technology sector. And since governments tend to be rather fickle and make decisions that defy logic, our job has gotten that much more titillating.

Regarcs,
Dr. Marc Bustin

December 17, 2009

What Does Global Warming Have to Do with Energy Stocks? was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

The cause of the crash was a batch of purloined e-mails from the University of East Anglia and its so-called Climate Research Unit (Climate Research Fabrication Unit is more like it). When the contents of the e-mails hit the fan, the U.K. Telegraph headlined that “This Is the Worst Scientific Scandal of Our Generation.”

On this last point, we can now see how much of the conventional wisdom about carbon dioxide (CO2), and related “global warming,” marches to a drumbeat that permits no foot to fall out of step. The East Anglia e-mails reveal a transnational cabal of scientists whose ethics and methods mirror those of Stalin’s favorite biologist, Comrade Trofim Lysenko.

That is, these modern Merlins of global warming have massaged the climate data to fit their preconceived anti-CO2 theories. For many years, the climate change Godfathers have humiliated and intimidated scientists who dared to disagree. They’ve squashed dissent. They’ve blackballed academic journals that didn’t toe the line of politically correct global warming wisdom. And they’ve done it all under the rubric of “peer-reviewed” science — where they are the peers über alles. Nice work, if you can get it.

The global warming crowd claims that the climate change is a phenomenon that’s wholly man-made — mostly in the industrialized West, and particularly by industries in the U.S. of A. The science is settled, they claim. You can’t argue with it. No, indeed. And how convenient!

But as someone who studied geology (admittedly at Harvard, where they’ve been teaching the subject only since 1787) and has been in and around the earth sciences for over 35 years, I always wondered why the proposed remedies for global warming and climate change are not really solutions to the alleged problem.

I mean, the so-called remedies for global warming mostly call for U.S. and other Western nations to pay high-energy taxes on carbon-based fuels. And the remedies call for the West — especially the U.S. — dramatically to curtail CO2-emitting energy sources. Oh, and Wall Street will be able to trade “carbon credits,” like it’s done with such success in the field of mortgage-backed securities and the like.

Meanwhile, under the proposed cap-and-trade schemes, the developing world gets a whole banana boat full of unspecified “climate reparations” from the West, all while burning lots of coal and using more and more energy from any and every source. Huh?

To my way of seeing things, the proposed remedies for global warming never added up. Now, with the release of the East Anglia e-mails, we know that things were never supposed to add up. The whole global warming and remedies process is designed to lasso a perceived “environmental” problem and use it to fulfill a laundry list of campus-Marxist political agendas. And quite a bit of the mainstream West swallowed it, hook, line and sinker.

Now that the cat is out of the bag (to change metaphors), is cap and trade dead? Have we reached a teachable moment about things like future energy use and industrial development? Will we see a period of backing down and thorough re-examination?

Or are there too many big shots, with too much ego and too much money, already too invested in the man-caused global warming process to admit of any doubt? Follow the money, I suppose.

Then again, there might not be much money to follow. Sometimes, deliverance comes from the strangest places…

Until we meet again,
Byron King

December 10, 2009

Global Warming Is a Politcal Science was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Basically, the government sets up a national limit for carbon emissions. This is meant to slow the changes that are supposedly occurring to the atmosphere, and by implication threatening the long-term health of the Earth’s climate systems.

Under the national Cap & Trade limits, industry has to obtain rights to emit carbon dioxide (CO2) or find another source for energy. This will lead to a new market for carbon-credits and carbon-trading. Industries that hold carbon permits will be able to operate. Industries that lack carbon permits will face shutdown and probable extinction. One way or the other, the economy will immediately transform into a system where one’s industrial fate is controlled by the carbon permits.

For example, carbon permits will dramatically alter the future for coal-based electricity. If coal gets burned at all, the Cap & Trade requirement will enforce CO2 sequestration — an utterly embryonic technology of which there is not a single large-scale working example anywhere on the face of the planet. And the coal-fired electricity under Cap & Trade will be much more expensive.

So non-carbon alternatives like wind, solar & geothermal will be more competitive as well. There is also a gratuitous plan to handicap the nuclear industry, despite the fact that nuclear power is essentially CO2-free. Old environmentalist habits — like hating nuclear power — die hard.

But the higher energy costs of production will have to pass through to consumers. At the end of the consumption chain, people can expect to pay higher prices for most everything that contains an element or two of electricity. (Gee, what might that be?)

In essence, the government will be setting up a new Federal Reserve, except instead of governing the nation’s money supply and quality, this new “Cap & Trade” Fed will govern the nation’s supply of energy. At the end of the day the “Carbon Fed” will control the output of the nation’s energy supply. In the long run, this may be more important than controlling the supply of credit or even the gold supply. Really, without electricity gold may yet prove to be a barbarous relic.

But consider how little most people knew about the original Fed when its enabling legislation was passed (in the dead of night) on Friday, December 23, 1913 — yes, almost Christmas Eve. The Panic of 1907-1908 was fresh in the minds of many observers. In that Panic, the U.S. money supply had simply dried up. The nation was broke, and even the U.S. government had to borrow money from the house of JP Morgan.

So by 1913 there was a basic political consensus that the nation ought to have some sort of “elastic” element to its currency. Most economists and policy-makers agreed that there had to be a way of increasing the nominal money supply quickly, especially when economic conditions led to a “panic” that dried up the circulation of dollars. Yet few understood the nature of the powers that the Federal Reserve Act was creating and placing in the hands of a quasi-independent monetary body. And even fewer were thinking about the political difficulty of pulling back those excess dollars when the panic abated.

Indeed, the U.S. Fed coexisted with a $20-gold standard for the next two decades. It was no curious coincidence that within a few short years, the U.S. was able to “afford” to participate in World War I, courtesy of the credit-creating mechanisms of the Fed.

Later on, when the central government needed more funds during the depths of the Great Depression, the $20 gold standard became untenable to the monetary managers. So in one of his first acts as U.S. President, Franklin Roosevelt signed an executive order that simply seized the nation’s gold and consequently unleashed the flood of fiat dollars into the monetary base of the nation. The dollar has never been the same.

This note is not to re-hash the history of the Fed. It is just to remind that the so-called “Climate Security Act” may claim to be all about Cap & Trade. But Cap & Trade is not just about “Climate Security.”

In the name of reducing the emission of CO2, the government is creating a means to control the economy down to the last electron. This is a power that not even the Fed holds.

Until we meet again…
Byron W. King
June 20, 2008

P.S.: Many oil-supplying nations are simply running out of the light sweet crude oil that we need to live our lives. In it’s place they’re coming up with heavy, dirty, raw oil. That oil needs to be refined, and we simply don’t have the refining capabilities. But that may not be a problem after all. A new breakthrough may have made oil refining a thing of the past, and given us a way to use all the world’s oil immediately.

Cap and Trade was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

But first things first. To all you who wrote in, I say, as always: Thanks.

Among the most notable feedback was a letter from a Canadian environmental scientist commenting that my first installment “…makes the reader think about fossil fuels and greenhouse gases in a completely different light from the mainstream nonsense.”

I also want to make special mention of the note I got from a bio-diesel alternative energy executive — who wrote in to clarify what the term “full lifecycle” means with regard to the CO2 impact of any fuel. In Part One of this series, I’d explained that it’s the oxygen produced by the raw plant sources of bio-diesel fuels that offsets its carbon emissions when consumed…

This is true, but I should have elaborated that it’s also the process by which plants make oxygen (photosynthesis) that offsets the greenhouse gases they result in when their end products are used as fuel. As we all learned in middle school, plants remove CO2 from the atmosphere in order to displace it with oxygen. I should have been clearer in my explanation — so thanks again to a sharp-minded Whiskey reader.

Aside from these, some hate-mail, a number of thinly-veiled pitches for books on climate change, and the usual sheaf of letters from those who want simply to argue about whether or not global warming exists, I received one other bit of feedback that warrants mention: A gem of a letter from a fellow who no doubt intended to pen a cogent rebuttal to my argument — but instead ended up objectively speculating, after a few paragraphs of meaningless, fact-less blather, that I must have a Confederate flag painted on the roof of my vehicle and a gun rack in the rear window…

It’s so refreshing to field some reasoned criticism. And just to clarify: I don’t have either of these things.

But that’s only because no one makes a gun rack to fit the rakish angle of my Prius’ rear window, and because Toyota doesn’t offer a Dukes of Hazzard paint scheme for it. Instead, I settled for the high-tech Chia Pet™ exterior finish of real, growing grass to lessen my “full lifecycle” carbon footprint. This came as an upgrade to the Earth Day option package — which includes as standard equipment woven hemp bucket seats, re-treaded recycled tires, in-dash CO2 output readout, 4/60 air conditioning (that’s when you roll down all four windows and go 60 miles per hour) and a giant portrait of Al Gore gazing vigilantly skyward through the windshield from the car’s desk-sized dashboard…

HOT, HOT, HOT: Jim, cruising Las Vegas in a borrowed, but stylish Prius.

I’m kidding, of course. I don’t really have a Prius. But I did drive a friend’s recently in Las Vegas. It was fun, in a golf-cart-ish kind of way. It’s perfect if you don’t have to haul anything, tow anything, drive on any roads rougher than a pool table, or get anywhere in any kind of a hurry (or in any kind of style)!

But enough of all this. On to bigger things, like just how big a pickle we’ll soon be in when it comes to both energy and the environment — if we accept as gospel the principal tenet of the enviro-ligion that The Reverend Owl Bore and his disciples believe:

That man and his machines really are causing this period of global warming, the latest in a billions-of-years string of climate change cycles this Earth has endured since eons before we crawled forth from the primordial ooze.

Coincidence ? Causation

Like I mentioned before, every time I write about energy or/and the environment, I get letters from people wanting to argue one side or the other of the global warming issue. The first part of this series was no exception. Some actually complained that I’d taken a neutral stance on whether mankind is causing global warming or not. In a way, this is why I wrote this interim essay — to explain my point of view more fully, even though it’s completely irrelevant whether man is causing global warming or not, or whether you or I believe it (I’ll explain why in a minute)…

Once more for the record, I’ve stated that I don’t pretend to be certain of whether or not man-caused CO2 and other so-called “greenhouse gases” are actually responsible for the modern up-trend in global temperatures. I’m not a climate scientist. Further, I make no attempt to minimize the fact that overwhelming evidence does indeed suggest that a slight increase in temperatures is happening on a global scale — or that coincidentally, levels of atmospheric carbon dioxide have increased measurably since the dawn of the industrial revolution.

However, within the framework of these actualities, I am certain of four things:

1) Planet Earth has experienced a huge number of climatic change periods in its history, both warming and cooling — all except the current one having occurred long before humans could ever have influenced the environment with their evil internal combustion engines or coal-fired power plants.

2) The “scientific community” (a term which has grown to include a lot of people whose credentials as climate specialists are questionable) is far from united in agreement that man-generated GHGs are the cause of the modern global warming trend. As an example, one of today’s most credible climate scientists, Carleton University paleo-climatologist and Professor of Geology Tim Patterson, testified in 2005 before Canada’s Commons Committee on Environment and Sustainable Development that:

“There is no meaningful correlation between CO2 levels and Earth’s temperature… In fact, when CO2 levels were over ten times higher than they are now, about 450 million years ago, the planet was in the depths of the absolute coldest period in the last half billion years. On the basis of this evidence, how could anyone still believe that the recent relatively small increase in CO2 levels would be the major cause of the past century’s modest warming?”

3) Lots of people — few, if any, of them scientists — are making lots of money and garnering lots of power and attention from the promotion of global warming hysteria. Conversely, those who challenge this mania (again, there are hundreds of credible examples of these) are mercilessly painted by the media and other global warming profiteers as “flat-Earthers.” They increasingly stand to gain nothing for their courage except ridicule, the ruination of their reputations, swift marginalization in polite circles and quite possibly a pink slip. To me, this gives their words a far greater weight than those on the other side of the argument.

4) The major media is not reporting on ANY of these three aspects to any significant degree — despite the somewhat inconvenient truth that credible backup for all of these facts can be found with just a few minutes of online research. (I did, and you can, too.)

Again, these are the only four truths of which I’m certain with regard to the entire climate change debate — except for one more thing: That even to a barely literate, synaptically challenged rube like me, it should be perfectly clear that the Earth’s climate should NOT stay static, but periodically change, sometimes radically.

Why does this come as a surprise to anyone? The simple fact that there are ocean-like deposits of oil — which is nothing more than the remains of eons worth of ancient plant matter subjected to huge amounts of pressure and time —under what’s now desert sand and arctic tundra should tell anyone with more than two brain cells that climatic change is the ONLY constant on planet Earth…

The Great Green Guilt-Trip

Before I elaborate on why U.S. energy policy is what it is, why it’s headed where it’s headed, and what it should be, I want to talk a bit about one of my biggest ongoing questions during the escalation of man-caused global warming theory:

If it’s not proven incontrovertibly by science, why do Americans seem to buy en masse into the idea that abundant-in-nature greenhouse gases are killing the planet simply because they come from their vehicle tailpipes and not solely the asses of buffalo and other natural sources?

The answer: Ignorance and guilt, both fostered by a corrupt politico-media spin machine.

Think about it objectively for a minute. It’s obvious that the media, our cultural icons and our elected leaders have been keeping us sheltered from the hard science or any real debate about man-caused global warming. These same people (especially the media) have also been making us Americans feel guilty for our success and the natural dominance of our less-flawed-than-everyone-else’s system for decades.Always do we hear about the strife in other countries and on other continents — and how it’s somehow our fault. Because we suck up too many resources. Because our trade practices are unfair. Because our foreign policy creates suffering and turmoil in nations that would ordinarily thrive. Because we aren’t doing enough to help…

And compassionate, feely saps that we Americans are, we buy it hook, line and sinker, whether it’s true or not. We feel bad about having it good — and for making it that way for ourselves. We never consider (because we never hear it) just how badly the Earth would have it if America did not exist. Who’d buy their bits of lead-painted junk? Who’d answer their call when they get unjustly invaded? Who’d send food and drugs and aid when they have an outbreak of disease or get washed out by a disaster? Where would they send their best and brightest to get educated? Where would throngs of their uneducated find gainful employment?

Worse than this, politicians exploit this guilt to tax us, regulate us, manipulate us, distract us, paralyze our thinking, stifle our tongues and seize ever more of our liberties. Nowhere is this more evident than in global warming policy. Based on nothing but faith in the correctness of a greenhouse gas THEORY promulgated by “objective” folks like movie stars, newscasters, politicians and the leaders of nations who benefit from our petro-strangulation, we’re losing our freedom to drive what we want (and what’s safest), consume as we desire and produce the things we need and that the rest of the world needs to buy — and used to buy from us…

This is the entire goal of the Kyoto Protocol, by the way — re-allocating the flow of world oil to favor underdeveloped nations and force the U.S. off the top of the heap in terms of economic and manufacturing supremacy (this is already happening, in large part out of concern for the environment). As I said in my first Whiskey & Gunpowder essay on this topic way back in March 2005:

“…the Kyoto Protocol was engineered to be extremely punitive to the U.S. — a nation which I’ve just proven burns its oil relatively cleanly and produces a comparatively large amount per unit consumed. Had the U.S. remained part of this farce, it would have been required to reduce its GHG emissions by an astounding 43% by 2012.

“The only way to do this would have been to radically curb oil consumption. This was likely the goal of the entire Treaty: Forcing the U.S. to use less oil, so that more would be available for the use of “developing” (read: major polluter) nations China, India, Brazil and about a zillion others in Africa — which are allowed under the Protocol to spew as much GHG into the atmosphere as is required to meet their needs. They are literally given the carte blanche right to pollute!

“When you really put it under a magnifying glass, the Kyoto Protocol appears to be nothing more than a UN-engineered scheme to siphon oil away from the U.S. and into the hands of pollution-exempt nations (many of them utterly corrupt) in UN President Kofi Annan’s native Africa and other zones — a disastrous move for the environment, from a Greenhouse Gas standpoint.”

As I’ve mentioned in previous essays, if Kyoto’s main thrust really was the reduction of greenhouse gasses, it would stipulate that a greater percentage of the world’s oil and fossil fuels be consumed by the nations with the technology and environmental conscience (read: democracies) to do it cleanest and extract the most wealth and prosperity out of it — countries like the U.S., not like China.

That’s how I know that Kyoto’s a bunch of Robin Hood-ish bunk — because it gives no weight to relative greenhouse gases per unit of fossil fuels consumed. If one believes that man-caused GHGs are ruining the Earth, then it makes no sense to restrict the fossil fuel consumption of nations that do it cleanly and facilitate the increased consumption of those that do it dirtily.

Bottom line: Literally, without anything resembling proof, and led by shameless profiteers globally and locally — some elected, some unelected and some previously elected — the United States teeters on the brink of energy policies which will accelerate our decline into dependency on other nations for not just energy, but all manner of manufactured goods…

And as I showed you in Part One of this series, this will do nothing but hasten the demise of planet Earth if the global warming alarmists do turn out to be right!

Anyway, thanks for bearing with me as I flesh out my own feelings on global warming a bit — and I’m sorry if my stance still seems somewhat neutral to you. I’m above all things objective, and like I’ve said all along: I’m not a climatologist, and not qualified to decide whether mankind is causing global warming.

However, I am qualified to expose corruption and self-interest, and the flawed policies that arise from them. And in Part Three of this series (the conclusion, I promise), I’ll show you the disillusioning truth behind what’s really driving U.S. energy policy — and what should be if we hope to survive in any form resembling the America we know and love.

Regards,
Jim Amrhein
Freedoms Editor, Whiskey & Gunpowder

December 14, 2007

Carbo-geddon, Part 1.5 was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

— Bruce Springsteen, “Born to Run”

THREE RECENT HAPPENINGS HAVE GOT ME THINKING yet again about America’s energy policies, our “carbon footprint,” and the inextricable link between fossil fuels (especially oil) and economic development of many nations in the modern world.

The first of these was Al Gore’s reception of the Nobel Peace Prize, the second was the November 7 oil tanker spill in San Francisco Bay, and the third is that light, sweet crude came within a candy bar’s price of $100 a barrel just days ago. These three seemingly unrelated events are nevertheless linked in my mind as harbingers of a rather bleak future — this two-part series explains why…

As some of you may know, my views on American oil consumption run in stark contrast to the mainstream’s reflexive condemnation of all things petro. There are two main reasons for this:

One, because no matter what the climate change scare artists (and profiteers, like Gore), clean-corporation spin doctors, and alt-energy utopians say, there’s simply no replacing carbon-based fossil fuels on a global scale at any point in the foreseeable future without massive application of deadly force. I’ll clarify this a bit later.

Two, because even if the United States could snap its collective fingers and instantly be transformed into a 100% fossil-fuel-free and self-sustaining Utopia of perfect green-ness, it likely wouldn’t prevent or even forestall the coming “carbo-geddon” at all. In fact, there’s good reason to believe it would actually hasten it.

One thing before we get started. For the sake of furthering the debate about world and domestic energy use in a manner most resonant with today’s pervasive assumptions about fossil fuels and the environment, this series is written from a standpoint which entertains the possibility that man-generated carbon dioxide and other “greenhouse gases” are the cause of the current trend of global warming. This does NOT mean that I believe this unequivocally, only that a lot of other people do — and that a certain amount of U.S. energy policy is indeed shaped by the possibility of such a correlation.

Pandora’s “Panaceas”

The blunt truth is that realistic, large-scale replacements for petroleum-based products as vehicle fuels and sources of power are either unrealistic, unsustainable or still decades away at least — no matter how wishful the thinking and rosy the rhetoric of pundits and politicians. Need an example?

Anyone who really looks into the ethanol boondoggle will find nothing more than a market-based farm subsidy program. In a nutshell: Politicians drive corn prices higher by playing into (or instigating) “global warming” hype and talking up or mandating demand for ethanol. This keeps farmers happy, profitable, paying more in taxes, and turning down millions in subsidies the federal government used to pay them NOT to grow corn. As long as there continue to be suitable acres for the clearing and planting (there’s only a finite number of these, however), everyone involved goes home in a limousine…

But meanwhile, the cost of every foodstuff either fed by corn (like most meats) or with corn as an ingredient (just about everything else) goes way up. Plus, millions of acres of forest retention, Conservation Reserve land, and wildlife habitat get plowed under to make room for more corn. And all for a relatively inefficient fuel that yields far less power and mileage than gas in today’s engines, while producing just as much carbon dioxide.

As another example, plant-based “bio-diesel” fuels show better promise of sustainability, but with similarly less-than-clear environmental benefits: Bio-diesel vehicles belch significantly more smog-causing hydrocarbons than those powered by gasoline or standard diesel. And although bio-diesel advocates claim the fuels have GHG advantages when evaluated from a “full lifecycle” standpoint (meaning that the extra oxygen produced by the crops used to make them offset their combustion CO2), these fuels spew just as much tailpipe carbon dioxide into the air as their petro-equivalents.

See what I mean about some of the leading energy alternatives being false panaceas for planet Earth? Also, “environmental benefit” is hard to pin down when it comes to new fuels for vehicles, home heating, power plants, etc. It’s a matter of priority. Should less GHG be the most important thing, even though man-caused global warming is a theory that’s far from proven?

I maintain that if the environmental impact analysis of some of today’s front-running alternative fuels gave appropriate weight to things like wildlife habitat destruction, increased water use, fertilizer contamination of waterways and aquifers, and related economic ripple effects, their “benefits” would seem less crystalline. Of course, as a lifelong outdoorsman and freedom-loving American, I have only two main concerns with regard to domestic energy policy, neither having to do with fuel costs:

1. The lowest possible negative impact on the environment as a whole — not simply the atmosphere (like so many “environmentalists” today) — but the land, wildlife, rivers, streams, aquifers and oceans, too.
2. Preserving Americans’ freedom to live in comfort, thrive in a free market and drive what’s safest and most capable (like light trucks and SUVs).

As I see it, aside from its inflation of certain segments of the market, perhaps the only true benefit to the mass adaptation of (viable) non-fossil fuels in the future would be the reduction in our consumption of foreign oil. If the U.S were to curb its thirst for imported petroleum, the environment would stand to benefit in a couple of ways: Less risk of disastrous oil spills from tankers, and less pollution from the consumption of fossil fuels used in shipping — IF man-caused greenhouse gases really are killing the planet, that is.

Also, all other things being equal, America would likely stand to benefit to some degree economically in both a direct sense — from a boom in the domestic alt-fuel industry — and in the more Machiavellian sense that we’d weaken the economies of petroleum exporting nations by softening the market for their oil, making our economy comparatively stronger.

Again, all this would be contingent on actually having large-scale, workable alternatives to gas and diesel fuels for vehicles, fossil fuels for power plants, etc. Which we don’t yet.

But here’s the really scary part: Even if the day comes when we do ultimately have an abundance of “clean” alternative fuels — whether it’s next year or in 2030 — it won’t matter a hill of beans in terms of a cleaner world.

In fact, it could make it even more polluted…

Once More From the Top: More U.S. Consumption = Less Global Pollution

In past Whiskey & Gunpowder essays (such as I wrote on March 10, 2005, June 20, 2006 and July 18, 2006), I’ve shown with hard numbers how America burns its fossil fuels far cleaner and extracts more power, productivity and wealth from them than other major oil-consuming nations — especially China and Russia, not to mention rapidly developing countries in Africa, Asia and the Middle East…

It’s a fact. To recap, here’s what I wrote on this topic on June 20 of last year, as derived from statistics from GeoHive, the Pew Center, the World Resources Institute and other sources:

• Measured on a per-unit-of-oil-consumed scale, the U.S. produces less GHG than every other major developed or developing nation except Japan (we’re on a par with militantly green Germany). While consuming 25.4% of the world’s oil in 2000, we emitted only 20.6% of the GHGs. Compare that to China’s 6.5% of world oil consumption versus 14.8% of the GHGs (2.8 times as much as the U.S. per unit of oil consumed); India’s 3.0% consumption versus 5.5% GHG (2.26 times as much as the U.S. per barrel); and Russia’s 3.5% consumption versus 5.7% GHG (more than twice as much per unit as the U.S.). Even darling of the greenies Canada belches more GHG per barrel of oil consumed than the U.S.
• Measured in terms of economic yield (meaning how much we get from the oil we use), one need only compare GHG emission to gross domestic product (GDP) to get the full picture of just how much more effectively the U.S. consumes fossil fuels than almost any other industrialized nation on Earth (again, Japan and Germany are the exceptions). In 2000, America produced 39% more dollars in domestic GDP per unit of GHG expelled than Canada, 569% more dollars per GHG than India, a whopping 642% more dollars per GHG than China, and an incredible 1,041% more GDP per unit of GHG than the Russian Federation.

Remember, this is data from seven years ago. The picture is even bleaker based on the latest data, which shows that China alone is on the verge of eclipsing America’s total output of GHGs — and will no doubt dwarf us in the near future, if economic and fossil-fuel consumption numbers from the last few years are any indication. Take a look at these cool cartograms I found:

This one shows, by relative size, every nation’s consumption of energy from all sources (oil, gas, coal, etc.)…

As expected, the U.S. out-consumes any other single nation, all sources considered. Judging by this map, it looks like the U.S. consumes a little less than twice the energy that China does, for instance (Geohive puts this figure at about 1.5 times as much, in terms equivalent to millions of tons of oil).

Now look at this one, showing the total output of all GHG by country…

Notice how America’s “carbon footprint” almost exactly mirrors its global energy consumption. But look at how China is already rivaling the U.S. for the world greenhouse gas Heavyweight Championship — despite consuming far less energy. Notice also how much bigger India, South Africa and the notoriously environmentally careless Russian Federation are on the GHG map than on the energy map…

Once again, this shows what I’ve been saying for years: Very clearly, the U.S. consumes its energy far more environmentally responsibly than almost every other rising economic power or existing industrialized nation (take another look at South Africa and both North and South Korea — they’re four or five times as big on the GHG map as on the energy map!).

Now, here’s the hot-house question of the century: How do you think this map would look in another 10 years? Especially given the following:

• Chinese economic growth at a rate of 10% per year — This could be a conservative estimate. From 2004-2005 alone, China’s GDP jumped 15.38%, compared to American growth of around 4% per annum. Conversely, this estimate of U.S growth could be optimistic. Consulting firm Global Insight projects U.S. GDP growth in 2008 at just 1.9%!
• China’s continued expansion of oil consumption — From 2000 to 2005, China’s demand for oil boomed more than 30%, while America’s appetite for crude increased just over 5%, and it’s trending even lower. U.S oil consumption actually declined around a half-percent from 2004 to 2005 (the last full year I could find statistics).
• China’s coal demand keeps skyrocketing — Overwhelmingly, China burns coal for its electricity (coal is by far the worst of the fossil fuels to consume, GHG-wise). And their appetite for power is expanding at a mind-boggling rate. From 2000-2005, Chinese demand spiked by over 62%. Over this same period, U.S. consumption was nearly flat-lined, edging up only 1%, and actually declining between 2000 and 2004. Completion of new coal-fired electricity plants in China is reported to be around one per week…

And let me reiterate that China is just one of the major up-and-coming polluter nations. The Russian Federation, India, the Koreas and numerous African republics also pose a huge and growing threat to the environment from a GHG standpoint. For the proof, all you need to do is look at the map, the consumption trends and the GDP growth numbers from just the last full year that statistics were posted (2005):

(Source: GeoHive)

Now mix in the “China Syndrome” I was fleshing out earlier and extrapolate it all over a decade — or a century…

Scary, huh?

But as I’ve said time and again: Were the U.S. to force other major consumer nations to curb their appetites for oil and fossil fuels — by ramping up our own oil/gas/coal consumption and stockpiling to monopolize a greater share of the world petro-marketplace — we’d actually be helping save Earth’s environment from massive amounts of pollution.

Headin’ for Carbo-geddon?

My “global” point with all of this analysis is that, if we don’t make some changes real quick, it’ll be just like The Boss said:

They’ll be living a runaway American Dream of prosperity without responsibility — and we’ll all end up riding around in the suicide machines (hybrid/electric cars) in a vain attempt to offset their eco-carelessness…

The U.S. can play clean and green by shackling the domestic marketplace and regulating American industry all it wants to. It feels good to “do our part,” right? But in the end, we’ll only be committing economic suicide so that the world’s largest polluter nations can thrive on the sea of money we spend with them, directly or indirectly.

Think about it: Communist China has been able to make itself “factory to the world” precisely because of their lax environmental policies and cheap labor — things that are only possible under a non-democratic model. They’ve been able to do this because they aren’t beholden to the same standards of conscientious production that a concerned, informed populace with the power to vote could hold them to.

Because of this imbalance (or “competitive advantage,” depending on who you ask), China can now afford to suck up all the fossil fuel resources they need to expand even more wildly — but without the regulatory guardrails that would be in place in a democracy. In turn, this enriches many other nations with little or no incentive toward concern for the environment, like most major oil-producing nations, a lot of which are major polluters in their own right…

And here we are, buying their tainted pet food and bits of cheap, lead-painted junk by the billions of dollars worth (yep, me too). Seriously, imagine what your local Wal-Mart or Target store would look like without any Chinese-made goods in it. The shelves would be as barren as they’d be after a post-tsunami looting.

Bottom line: If mankind-generated CO2 and other GHGs are indeed responsible for climate change that ultimately puts us all in peril, it’ll definitely be America’s fault…

But not because we’re polluters. It’s because, like the Eloi in H.G. Wells’ The Time Machine, we’ll have stopped being producers and world leaders of economic prosperity ourselves. Instead, we will have outsourced our polluting to a horde of eco-Morlocks who use the money they make from us to buy and consume resources we use increasingly less of in ways that will bring about “carbo-geddon” worlds faster than we ever would have.

Next up: What we can do about it. Brace yourselves, it won’t be easy — or easy to hear.

Dreading where we’re heading,

Jim Amrhein
Freedoms Editor, Whiskey & Gunpowder

November 30, 2007

Carbo-geddon, Part I was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

“The sea route running along the Arctic coastline of North America, normally clogged with thick ice — is nearly ice free for the first time since records began.”

— “Northwest Passage Is Now Plain Sailing,” Guardian Unlimited, Aug. 28

IT STARTED WITH A RUSSIAN EXPEDITION planting the Russian flag in a polar seabed. Though largely symbolic, it touched off a scramble among a handful of nations, all trying to lay claim to the Arctic. Among these claimants: the U.S., Canada, Russia and Denmark.

Why the sudden interest in the Arctic? There are two big reasons. First, thanks to global warming, deposits of natural resources once layered over in impenetrable ice are now easier to get at. Second, thanks to melting ice, some previously icebound shipping lanes are opening up.

Today, the Arctic prize is a multibillion-dollar opportunity.

As a treasure trove of natural resources, the Arctic boggles the mind. By some informal estimates, the region holds 25% of the world’s undiscovered oil and gas. It could also hold massive amounts of crystallized methane — another potential fuel source. More formal surveys are under way by the Arctic lottery hopefuls. So in time, we’ll know more about what Mother Nature has cooked up in the oven beneath the icy Arctic crust.

Minerals galore also lie untouched below the cold blue polar sea. One day, the region could be home to the undersea mining of copper, zinc, cobalt and diamonds.

In truth, these resources are still a long way from being developed. The climate is incredibly harsh, and easier-to-get-at resources still exist on the fringes of the Arctic. As an oil and gas story, this one has a long fuse.

The Arctic thaw’s more immediate and bigger impact will be as a shipping lane. Since Aug. 21, the Northwest Passage has been open to navigation and free of ice for the first time. “Analysts…confirm that the passage is almost completely clear and that the region is more open than it has ever been since the advent of routine monitoring in 1972,” reports the U.S. National Snow and Ice Data Center.

The fabled Northwest Passage through the Arctic Ocean connects the Pacific and Atlantic oceans along the northern coast of North America. To pass through here from China on your way to Europe is about 5,000 miles shorter than going through the Panama or Suez canals.

As the Financial Times observes, “A ship traveling at 21 knots between Rotterdam and Yokohama takes 29 days if it goes via the Cape of Good Hope, 22 days via the Suez Canal and just 15 days if it goes across the Arctic Ocean.”

An oil tanker could make the trip from the Russian port city of Murmansk to the east coast of Canada in a week by crossing the Arctic Ocean. That is about half the time it takes to get an oil tanker from Abu Dhabi to Galveston, Texas.

In the early 1900s, it took the famed Norwegian explorer Roald Amundsen and his team nearly two years to pick their way through the ice and narrow waterways. Now an open passage could revolutionize shipping.

More than 90% of all goods in the world, measured by tonnage, make their way by sea. And as I’ve noted in past issues, the rapid surge in trade with China and India is putting a lot of strain on ports around the world. In recent years, the volume of container shipments has grown 5-7% annually — basically, doubling every 10-15 years.

The ships carrying those containers are getting bigger, and the old canals can’t hold these new seafaring beasts of burden as they once did. The Suez Canal can still handle the largest current container ships, but not the next generation.

The Panama Canal is even smaller. It’s too small for ships that are now common on longer shipping routes. Panama plans to deepen its channels and make them wider. But even so, the new Panama Canal won’t be able to service the next generation of ships.

So it looks like the world will have a new navigable ocean. The effects on trade could be immense. Much shorter shipping distances and quicker shipping times will lower the cost of doing business. It could lead to big increases in trade and, certainly, a major shift in sea-lanes.

A freer-flowing Arctic Ocean would also bring fish stocks north — with fishing fleets not far behind. It could mean a new boom in fishing for salmon, cod, herring and smelt. It could also mean that sleepy old ports could become important new hubs in international trade.

As the Financial Times recently opined, “Leading world powers have an unprecedented chance to win navigation rights and ownership of resources in the Arctic seabed untouched since its emergence during the twilight of the dinosaurs.” The U.S. alone could lay claim to more than 200,000 square miles of additional undersea territory.

The specific investment implications of this are still too early to say. But the cracking open of new trade routes or reopening of old ones — and their impact on global trade — always has ripple effects across financial markets. As for the Arctic, this has got to be one of the most important new developments on that front in a long time.

Sincerely,
Chris Mayer

November 2, 2007

Thanks, Global Warming! was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

First, I give a heartfelt thanks to those who wrote in with kudos and "attaboys." It’s always nice to hear from those who’ve been persuaded, or whose points of view, so long unechoed in the mainstream, have been affirmed. Special thanks to the fellow who invited me to join him for a pheasant hunt on his Michigan farmland.

I also want to thank the entire Whiskey & Gunpowder readership for NOT writing in to bust my chops about the cheesy pun I used for the title of my last piece. I simply could not resist the wordplay, even though it no doubt made some of you groan. A thousand thanks for your restraint (not one person wrote in about it) — and a thousand apologies for my self-indulgence.

And finally, just to prove to you that we don’t shrink from criticism here, I offer the following responses to my detractors…

To those readers who wrote in to claim, in so many words, that I’m an enemy of the Earth, I say this: As a lifelong outdoorsman and conservationist, pristine, untrammeled nature is as precious to me as it could ever be to you, likely more so. And I’d wager you a year’s salary that I spend more time out in it — and more dollars on its preservation, defense, and maintenance — than you ever will.

To those readers who complained that I tend to steer my essays on the environment toward issues involving shooting and the blood sports, I say this: I write about freedoms. And when it comes to the environment, those freedoms most in the cross hairs of the quasi-religious fashion show the environmental movement has become in this country are those involving hunting, shooting, fishing, and the responsible treading upon the lands our tax dollars pay for with the gear involved in pursuing these freedoms.

To those who wrote in to take offense at characterizations like "tree-hugger" and "enviro-Nazi," I say this: These labels are meant to call into glaring relief zealous factions of the new religion of environmentalism that would sacrifice all American freedoms — not to mention prosperity — on the altar of flawed assumptions about the natural world, and about how best to save and preserve it. Most Americans who would call themselves environmentalists fall nowhere near these classifications in my eyes. Apologies if I didn’t make this clear in my prior essay. The last thing I wish to do is alienate the open-minded and receptive with my characterization of the narrow-minded and destructive.

And last but not least, to the guy who wrote to excoriate me as clueless and factually inaccurate because HE didn’t distinguish between my comments on carbon monoxide and carbon dioxide, I say this: Get a clue yourself — and learn to read!

Now, onto other matters, like offending another group of misguided, misanthropic misusers of the environmental agenda: animal rights activists.

An Inconvenient "Toot"

As you know, I’m normally either poking fun at the animal rights crowd or exposing their agenda as disingenuous, fraudulent, and logically flawed.

But today, I’m their best freakin’ friend. Seriously, I am so glad these fools exist right now — because they’ve poked a far larger and more-visible-to-the-mainstream hole in the human-caused global warming argument than I could with a thousand essays in this forum…

As you may have noticed, a new element has entered the global warming debate lately. Well, it’s not really new at all, but it is newly anointed as credible by the mainstream media — owing largely to the slick, refined PR machine that PETA and friends have spent all their donation and membership monies building (they certainly haven’t used it to buy any land for wildlife to flourish on). The element I’m talking about:

Greenhouse gases from livestock, uhh… emissions.

Yep, cow farts and other livestock-related processes. As it turns out, PETA’s rabid hatred of all things carnivorous has driven them to mass-publicize a fact that pulls the rug out from under a major pillar of Al Gore and company’s politically motivated hatred of all things carboniferous: that the cumulative effects of raising animals for food creates more greenhouse gases than all the world’s cars and trucks combined.

Only around 9% of the world’s atmospheric CO2 comes from livestock sources. However, as measured by CO2 equivalent, around 18% of the Earth’s greenhouse gases (CO2, methane, and nitrous oxide are the biggies) result from animal emissions, the livestock-rearing process, and the carbon-negative impact of clearing grazing acreage of forest and other plants, according to a United Nations Food and Agriculture Organization report released last November.

Here’s how this is possible, in case you’re wondering…

While it’s true that the carbon dioxide that cars, trucks, fossil fuel power plants, and the like spew out represents around 75% of the greenhouse gases released by all mankind-related sources, other gases — like the methane and nitrous oxide that livestock rearing generates in copious quantities — have a "greenhouse" effect many times more powerful than CO2. In fact, methane’s actions in the atmosphere account for 23 times more GWP (global warming potential) than CO2, and nitrous oxide nearly 300 times as much!

What this means is that if Earth’s current warming trend is indeed caused by mankind (despite what Gore and friends say, there isn’t a scientific consensus), and if the U.N. report is accurate, then cows, pigs, and chickens are more to blame for it than cars…

This is what PETA has latched onto and successfully penetrated the mainstream media with. On the strength of this U.N. report and the high profile of Al Gore’s movie, PETA is calling for eco-minded Americans — and, specifically, Gore himself — to go vegetarian in the name of Mother Earth. And indeed, it has a point.

According to researchers from the University of Chicago, if someone really believed that reducing their personal "carbon footprint" (more accurately called a "greenhouse footprint") would make a difference in the global temperature, eschewing meat would make far more of an impact than buying a Prius. Around 50% greater, the U of C scientists estimate.

Unwittingly Exposed: The Green Crowd’s 1% Solution

I’m a hunter and carnivore — so why do I love the PETA crowd for exposing this, you’re asking?

Because it underscores exactly how insignificant vehicular CO2 emissions are, from a global warming standpoint — again, that’s IF you buy into their correlation. Think about it: Everyone’s making such a squawk about tailpipe CO2, yet if the U.N. folks are right about livestock making more of an impact than cars, that means vehicle exhausts are the source of less than 18% of the world’s greenhouse gases (some credible estimates peg this number far lower). For simpler math moving forward, let’s say that 16% of global GHG comes from vehicular exhausts. That’s probably generous, but what the hell…

This means that the mass adaptation of more efficient hybrid cars — which offer at most a 25% real-world fuel mileage benefit over comparably sized gas-powered cars (Prius real-world MPG hovers at around the high 40s, not much higher than what a Honda Civic or VW TDI will get you) — would result in a net GHG benefit of around 4% AT MOST. But remember, that’s if everyone in the world were to adopt these lean, green machines.

Of course, this wouldn’t be possible, since trucks, buses, tractors, military conveyances, and other low-mileage vehicles would still be gas- or diesel-powered. Also, not all nations give a rat’s ass about GHG, or are in a position to adapt to hybrid vehicles on a massive scale.

So let’s come at this another way — one that isolates the U.S. impact alone:

Estimates peg the current number of cars and trucks at around 600 million worldwide. Around one-third of these are here in the States. Assuming that the average vehicle in the U.S. is likely to be far newer, in much better condition, and of a more efficient design to begin with than most other places on Earth, I’m guessing that NO MORE than a fourth of Earth’s tailpipe CO2 comes from America’s cars and trucks (it’s probably far less). So given a 16% estimate of global GHG from tailpipe emissions, this means around 4% of the total annual atmospheric GHG burden comes from AMERICAN tailpipes. Now, stay with me here…

Let’s say that every American citizen were all of a sudden forced by law to trade in their current personal automobiles for hybrid "roller-skate" models. Since these cars represent only around a 25% efficiency benefit over normal cars — and since millions of delivery trucks, big rigs, buses, tractors, and military and emergency vehicles would still be guzzling gas and spewing lots of GHG — the overall impact of such a switch on Planet Earth’s annual GHG output would likely be no more than 1%.

Pretty pathetic, huh?

Now I ask you, as environmentally conscious Americans: Is a 1% reduction in world GHG really worth giving up the luxury, utility, convenience — and yes, even the extra safety — of larger and more capable vehicles?

I say no. Why should Americans give up any variety of our beloved cars and trucks — not to mention our economic advantage — while Kyoto-exempt "developing" Asian and African nations can belch as much GHG into the atmosphere as they want? It isn’t fair by any method of measure…

And now, poetically, PETA’s agenda is exposing this lack of international energy parity.

Carnivores vs. Carbon Whores

Of course, none of this addresses the "problem" of livestock/agricultural GHG sources. In other words: What should we do about the cow farts — now that we know they’re a prime source of atmospheric GHG?

Well, if PETA and friends had their way, we’d all be forced into vegetarianism for the sake of the environment. Mind you, the animal rights crowd doesn’t care WHY we’re vegetarian — only that we don’t harm their precious beasts. They’re single-issue folks, and they’re leveraging the "carbon footprint" concept to further their agenda. That’s why they feel no compunction whatsoever about throwing their own comrades on the political left under the bus with their public calls to Al Gore to become vegetarian or admit being a hypocrite…

What they don’t realize is that when forced to make the choice, Americans will stand up as carnivores instead of lining up with PETA’s carbon whores. There’s no way in this world that we’ll give up our bull roasts and pig feasts, burgers and steaks, baby back ribs and carnitas, ball park dogs and sausage links, fried chicken and Thanksgiving turkeys — even if we do suspect that it’s all contributing to global warming.

And what’s kind of funny-ironic is that if people really stop to consider the ramifications of what PETA has successfully brought to the mainstream consciousness, they may realize things that aren’t in the best interests of either the animal rights OR militant environmental movements. Things like…

What if all the fuss about animal "emissions" makes people realize that global warming from greenhouse gases is a perfectly natural process — one that has waxed and waned many times over many eons in response to many factors (like animal life and its byproducts)?

What if Americans and others around the world decide that while they can’t give up their meat — but they can do without all those GHG-farting deer, moose, elk, bison, horses, cape buffalo, yaks, gnus, caribou, water buffalo, kudus, impala, wart hogs, kangaroos, lions, tigers, and bears? (The PETA crowd would love this, huh?)

What if people start thinking about how their OWN flatulence is killing the planet? Would we start regulating our diets to reduce our own "tailpipe" emissions (I’m telling you right now, a vegetarian beans-and-cabbage diet wouldn’t be optimal)? Would we start restricting human births for fear of the environmental impact of their ass-gas?

See how absurd this could all get — how absurd it already is?

Now, imagine how absurd and restrictive all this environmental hysteria could become if the government figures out ways to leverage all these fears for more control over your dollars and freedoms? Make no mistake — that’s the goal here, as it always is with politicians.

And anyone with half a brain who’s able to detach from fear and prejudice long enough to think about it can figure this out. This leaves out most militant environmentalists (see als tree-huggers and eco-Nazis), all animal rights activists, and anyone who accepts as the scientific gospel anything in Al Gore’s one-sided, campaign-in-a-film can HOLLYWOOD MOVIE An Inconvenient Truth.

Bottom line: I don’t want to lose any more of my freedoms, choices, or money because a bunch of weasel politicians have found a way to parlay a "crisis du jour" that’s far from solidly rooted in science into even more cash and power — and a bigger, more far-reaching government. And it’s all because we’re putting our faith not in facts, or even reasoned debate, but into half-truths that we’re being scared and shamed into accepting by people who are hopelessly agenda driven…

Can’t we just stop and think about this a little — preferably over a burger — before our naivete and capitalist guilt cause us to plunge like so many lemmings headlong over a cliff of needless regulation?

Stomping hysteria in my carbon footprint,

Jim Amrhein
Contributing editor, Whiskey & Gunpowder

March 22, 2007

Meat and Crusaders was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

It could be a bumpy ride, though. I’ll tell you about forces that should drive uranium higher, as well as a few that could drive it lower in the short term.

2007 Could Bring an M&A Feeding Frenzy in the Uranium Mining Industry

Two weeks ago, I attended the 2007 Vancouver Resource Investment Conference. The size of the conference blew my mind! There were way more exhibitors than last year, and the hall was jampacked with investors looking for Canada’s natural resource bargains.

They were finding them, too — in gold, silver, lead, zinc, nickel, diamonds and many other things. And my favorite metal, uranium, is so hot that the exhibitors set up a special “Uranium Alley” so investors could find these companies more easily.

As I talked to miners at the conference, a couple of things became clear:

Staff is at a premium. Rockhounds love what they do, but even they can’t do it forever. And when the price of uranium cratered in the 1980s, staffs were decimated. About 20,000 engineers and geologists worked in the uranium sector in American companies during the last uranium boom. That number is about 400 now, too many of whom are close to retirement age. So if you can find a company with a fairly “deep bench” of uranium mining experts on its payroll, those guys are worth their weight in gold.

One solution to the staffing shortage: mergers. If two companies each with three expert rockhounds merge, that company now has six experienced prospectors to work on the best of its projects.

Speaking of projects…

Patchwork quilt of claims lays groundwork for merger mania. Look at a map of any uranium-prospective territory and you’ll see a patchwork quilt of claims. Heck, I could practically see some deals coming to mind across the exhibitor booths, as CEOs of various companies finally got a chance to get together.

I imagine the conversations started something like this: “Hey, you have two working projects in the Athabasca Basin, and I’ve only got one claim there and no time to work it. Meanwhile, you’ve got a stray property near my project in Wyoming. Let’s make a deal!”

These two factors should pump up M&A activity in an industry that is already riding a growing flow of investor cash. I even got the feeling at the conference that if I changed my name to Sean Uranium Inc., suddenly I’d find myself raising a ton of cash pretty quickly.

Well, that’s half in jest. But I’m dead serious about the forces driving uranium, though — forces that are approaching critical mass…

Why I’m Convinced the Second Wave of Uranium’s Bull Market Is About to Begin!

I call uranium the “white-hot metal,” and not only because it glows in the dark. During the course of 2006, the uranium spot market price continually climbed by 99%, from $36.25 to $72 per pound of U3O8. At $75 per pound, the price is now more than 10 times its record low of $7 per pound that it hit in 2000.

The first big move in uranium is over — the next one is about to begin. And if uranium prices DOUBLE from here — which I think could easily happen — some of these small-cap wonders I’m looking at could go to the moon.

I believe we’re poised to enter the “Second Wave” of uranium’s big bull market…probably the biggest bull market the world has ever seen.

Despite the big bull rally in uranium over the past couple years, on a historical basis, it’s still dirt-cheap! Uranium hasn’t come anywhere near its old peak in inflation-adjusted terms. In 1978, uranium topped out at $43.40 per pound — but adjusted for inflation, that’s around $145 per pound in today’s dollars. It’s now trading at $75 per pound. That means uranium could nearly DOUBLE and still not surpass its old inflation-adjusted highs.

That’s why I think we’re looking at $100 uranium by the end of this year — a 39% move from recent levels. Pretty sweet — and even then, uranium will still have plenty of room to run! How high? Let me show you…

Forces That Could Drive Uranium to $100 per Pound…and Beyond

Force #1: The Supply/Demand Gap

Consider these facts…

1. About 16% of the world’s electricity came from 440 nuclear reactors last year, according to the World Nuclear Association. Currently, there are 28 reactors under construction around the world and another 62 being planned:

2. An additional 100 plants will be built in the next 10 years, with 40 of them in Asia.

3. Bottom line: By 2050, scientists estimate the world will need about 900 more nuclear power plants to keep up with growing energy requirements.

As a result, the undeniable reality is that demand for uranium is outstripping supply. In 2005…

• Supply from mines was 102.5 million pounds
• Demand was 171 million pounds
• The gap was 68.5 million pounds.

Totals for 2006 aren’t in yet, but demand probably topped 180 million pounds. And as new nuclear power plants come online, that demand will grow. A typical 1-gigawatt nuclear reactor requires around 200 metric tonnes of natural uranium per year. During startup, a new nuclear plant can use TRIPLE its normal requirements.

The fact is production from world uranium mines now supplies only 62% of the requirements of power utilities. The rest is made up from rapidly dwindling stockpiles, mainly old Russian nuclear warheads that are converted to material for power plants. That agreement expires in 2013, and won’t likely be renewed, since the Russians have a very ambitious nuclear program of their own.

Moreover, here in the U.S., utility consumption of uranium outpaces U.S. uranium production by more than 20-to-1.

Force #2: Crisis at Cigar Lake

Uranium prices were already climbing steadily when the nuclear power industry was rocked in October by disastrous news out of Cameco’s Cigar Lake Mine.

Cameco planned to bring Cigar Lake online in 2008, with 7 million pounds of uranium in the first year and full-scale production of 18 million pounds annually thereafter. Keep in mind, 18 million pounds is more than a tenth of last year’s total global demand of 171 million pounds. That’s like the global oil market losing Saudi Arabia’s production!

In 2008, uranium demand was already expected to exceed supply by 25 million pounds. With Cigar Lake seriously delayed, that gap will be 32 million pounds. Put another way — the shortfall in uranium is going to soar by 30% just in 2008.

Sure, Cigar Lake will be brought into production eventually. But meanwhile, demand keeps building up. Uranium consumers around the world can see this squeeze coming, so the race is on. That explains why spot uranium prices basically doubled in the course of a year, and the stocks of near-term uranium producers vaulted higher.

Cigar Lake could be a force driving uranium prices this year both UP and down. I’ll tell you more about that in just a bit.

Force #3: China, the Uranium-Devouring Monster

China deserves mention as a force all its own. How hungry is China for uranium? The Chinese are hot-footing it through the Australian outback with bags of cash, investing in the best small companies sitting on large quantities of uranium. And no wonder! China plans to import 2,500 metric tonnes of Australian uranium per year by 2020, as it builds 24-30 new atomic power plants.

The really bullish news is that China’s total expected annual uranium demand is three times as much — 7,500 metric tonnes. And it will use every pound of it, as China plans to construct two new 1,000-megawatt nuclear reactors every year, including two coming online this year.

Force #4: Global Warming Trumps Everything

Fact: The 11 hottest global temperature years (since records began in 1861) have been since 1990.

The ice caps are melting at an alarming pace. And whether it’s hurricanes in the Atlantic or typhoons in the Pacific, storms are whipping up with an intense fury. Unless your name is “ExxonMobil,” there is very little argument about why this is happening. A normal global warming cycle is being worsened by man-made pollution — greenhouse gasses that trap heat.

And though people rant and rave about gas-sucking SUVs, the biggest source of greenhouse gasses (apart from methane-farting cows and other livestock) is coal-fired power plants. People point to the fact that China is building a new coal-fired plant every week and shake their heads. Well, here in the U.S., we have about 150 new coal plants planned or already being built. Many of these are using “old-coal” technology for cost savings.

It’s almost as if China and the U.S. are engaged in some kind of suicide pact. And I doubt it’s going to have a happy Hollywood ending.

There is hope, though. Awareness of the crisis of global warming is becoming so acute that major corporations are joining forces with environmental groups in an unprecedented alliance to push for quicker action on global warming. The alliance of greens and Corporate America is called the U.S. Climate Action Partnership, and we’re talking some really BIG names here: Alcoa, BP America, DuPont, General Electric, FP&L Group, and more. One of the solutions to global warming is nuclear power.

Here’s why: An operating nuclear power plant produces zero greenhouse gases. Compare that with your average coal plant, which can spew 3.7 million tons of carbon dioxide (a greenhouse gas) into the air every year, along with hundreds of tons of heavy metal-laden ash.

I expect public awareness on this issue to grow over the next few years and the public to start demanding utilities make the switch. This boosts nuclear power in two ways — increasing demand for uranium at power plants and lifting bans and overregulation on mining.

Force #5: Peak Oil and Peak Natural Gas .

In 2006, global oil demand grew 0.9%, thanks to steady growth in China and the Middle East. The world used 84.5 million barrels of oil per day last year, according to the International Energy Agency. That’s nearly 31 billion barrels, and the most oil used in a year…EVER. What’s more, world demand is forecast to rise 1.6% this year to 85.77 million barrels a day.

Worldwide oil and gas reserves are becoming depleted at an ever increasing rate, with many analysts convinced that we are fast approaching Peak Oil and Peak Natural Gas.

In fact, the former Soviet Republic Belarus, which was hardest hit by the Chernobyl nuclear accident, is pulling out all the stops to accelerate its nuclear energy program. Reason: President Alexander Lukashenko is desperate for an alternative to Russian natural gas that is fast rising in price.

If Belarus is embracing nukes, I believe even the most die-hard holdouts won’t be far behind.

Force #6: Nuclear power looks cheaper all the time.

Standard & Poor’s recently published a study showing that the next wave of nuclear power plants should be able to produce electricity at $55 per megawatt hour, versus the average rate of $50 per megawatt hour at a coal plant.

Even the $55 figure may prove conservative, because the second wave of nuclear plants could benefit from standardization. All told, the cost of a megawatt hour could potentially drop to about $44!

That’s right: Nuclear power could end up being cheaper than coal, and without the tons of greenhouse gases and poisonous ashes that coal plants spew into the atmosphere.

Force #7: The Feeding Frenzy Could Get Even MORE Intense Next Year

Most uranium is sold under long-term contracts. But the utilities that contracted for uranium in the future are finding they’re coming up short, and for good reason: When a nuclear reactor is first fired up, it can use TRIPLE its normal amount of uranium oxide.

While the price of uranium is rising, suppliers can still scrape together enough to meet demand. But come 2008, we may reach a tipping point. A lot of uranium users don’t seem to have enough contracts to cover their needs. And many of the contracts they do have are ending — which means suppliers can negotiate at MUCH higher prices.

So if you think uranium prices have been on a tear so far, just wait…2008 could be an even more intense feeding frenzy.

And when you come down to it, we should see prices move well in advance of that. That, in turn, should take the stocks of small, well-managed companies sitting on big resources and potentially send them ballistic!

Can Uranium Prices Come Down Temporarily? Heck, Yeah!

In fact, I’m hoping we get a pullback. That would be a golden buying opportunity.

Here are a few factors that could drive uranium lower in the short-term…

1. Russian imports. Right now, Russia has two choices. It can sell uranium to the U.S. market through the United States Enrichment Corp. (USEC) or it can pay a 116% tariff. But Russian-owned Techsnabexport is working on a new civilian nuclear power deal between Russia and the U.S. You can bet that U.S. utilities, desperate for lower-cost uranium, are pushing hard for this deal, which could come as soon as the first quarter of 2007.

2. Cigar Lake update. Last week, Cameco announced it expects to seal off water flow to its Cigar Lake uranium mine by the second quarter. But it has delayed preliminary cost estimates and timelines, which were supposed to come out in February, until late March.

Does that sound to you like Cameco’s going to get that mine back online anytime soon? It sure doesn’t sound like it to me.

So Cameco is STILL having trouble stopping water from flooding the mine. One engineer I spoke to in Vancouver joked that so much water is pouring in, Cameco should stop trying to mine uranium at Cigar Lake and turn it into a hydroelectric project.

Nonetheless, it would be surprising if the March report isn’t upbeat. Corporations have a way of putting even the worst news in the best light…and maybe Cameco will surprise everybody by reporting actual good news.

On the other hand, if Cameco pushes its timeline for Cigar Lake back by years, uranium could lift off the launch pad.

3. Overspeculation. I like speculation as much as the next guy, but according to a recent update from TradeTech’s Nuclear Market Review, “Speculators are holding about 24 million pounds of U3O8 equivalent.” That is about 22% of global uranium production in 2005.

So if Cameco announces good news on Cigar Lake, or if Russia’s Techsnabexport hammers out a trade deal, speculators could decide to sell, temporarily exaggerating any short-term decline. The Uranium Participation Corp. is holding a bunch of uranium with the intention of selling to utilities at a higher price at a later date. If prices start to go down, the fund could decide to start unloading.

SUMMARY: I expect a pullback in uranium prices this year, but it will be a short-term correction in a big bull market. What I recommend is you put HALF your money to work NOW, then put the rest to work if and when we get a sizeable pullback.

If uranium doesn’t pull back, at least you’re in the game. If uranium does pull back, you’ll average in for a better price.

Good luck, and good trades.
Sean Brodrick

February 7, 2007

7 Forces That Will Drive Uranium to $100 Per Pound in 2007 was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.