Environment: It Needs Oxygen!

 

th[3]Are politicians deaf to the cry of the wild that they would rather subsidise fossil fuel than promote a green environment?

A reminder: Government should benefit the people not those in power. Wang Fuzhi

Should we believe politicians and the faceless bureaucrats that the world will be saved by the buying and selling of carbon emissions? I dealt with some aspects of selling pollution in my previous post: Environment: It’s Dying. What is really interesting is the number of developing countries who are taking part in this market oriented money making enterprise. There are several projects initiated by UN-REDD Programme aimed at preventing further deforestation and degradation of forests in developing countries.

Madagascar is one such country which has allocated 705,588 carbon credits for a project in the Makira Forest. The Makira Forest of 400,000 hectares (1,500 sq. miles) is a sizable area. A number of projects are underway to convince the local communities that there is an alternative to deforestation. However these prevention techniques are small in scale e.g. one will take 30 years to offset 32 million tonnes of CO2. A second will avoid 1.6 million metric tonnes over a 25 year period. http://phys.org/news/2013-09-massive-carbon-credit-sale-madagascar.html

 

  1. The world emits 32 gigatonnes annually.

Other projects in Africa include Tanzania which has sold some credits for $US 200,000 in forest conservation. A further hope is to encourage eco-tourism. Trains and boats and planes go jollying by, burning fossil fuel but it’s ok because they’ll pay. An earlier project received $US 1.9 million over a four year period 2010 – 2013. Tanzania Daily News

Why the focus on Developing Nations?

Madagascar is losing an approximate 100,000 hectares (386 sq. miles) each year to burning for agriculture. Zambia is losing between 250,000 – 300,000 hectares annually, predominately in the making of charcoal for heating in business and the home.

thFTLUIBEWIn South America the situation is even worse. Peru, Brazil and Ecuador etc. the region is losing an estimated 13 million hectares year on year. In December 2014 the UN held climate talks in Peru, which has some of the worse deforestation in the region. Brazil attended but continues with accelerated deforestation under their president Rouseff, a former head of an oil company. The conclusion of the meeting was to replant 20 million hectares of trees. However, in the period 2001 – 2012 some 36 million was lost to agricultural expansion. The guardian2014/12/09

There is little sign of abatement as, theguarian2015/01/28 reports. Roads run deep into the Amazon where oil and gas blocks are now much bigger than those of Texas e.g. 730,000 sq.km. The setting up of National Parks has prevented some incursions but deforestation continues apace. Ecuador, who signed an agreement in 2007 to prevent further road building changed tact under economic pressure. So much for contracts! Bolivia too is open for business.

They’re killing us but the profit is excellent!

The talks in the capital Lima had been an initiative of Germany in 2011 and thus termed the Bonn Challenge. As we can see – they are doing the mad dog thing – chasing their tail. Not very successful based on the amount of forest lost. Scientists believe that around 17% of CO2 emissions – more than what America produces each year – is caused by deforestation especially in tropical areas. www.phys.org as above

The economic rationale of the region fits well with the self-interest theory as examined by Dani Rodrik p249 the Harvard economist, “In the case of global warming, self-interest pushes nations to ignore the risks of climate change”. This would appear to be the case in South America. But if we keep in mind the carbon emissions of deforestation (more than America) can we justify allowing these countries to simply cut and burn at will irrespective of the consequences to climate change. The Globalization Paradox

Dani Rodrik p277 gives an emphatic yes in principle to developing countries finding their own way. “The right approach would be to have China, and indeed all emerging nations, free to pursue their own growth policies”. As we travel down Rodrik Road and allow carte blanche development for ‘emerging’ nations, he argues that it would be ‘reasonable to expect’ that these nations would not pursue policies that would lead to huge trade balances. An alternative might be, “Every nation has responsibility”, Ottimar Edenhofer of the Potsdam Institute for Climate Impact Research; quoted: www.blogs.reuters.com   2015/04/13

Rodrik’s prime concern is the sanctity of the market, not the environment. Large trade balances in favour of China or India could swing the pendulum of power, and, power is the name of the game. Why with the economic power at their behest would China / India not seize the opportunity to dictate world policy just as others have done, past and present?

It was and is ‘reasonable to expect’ America to pursue policies that aid the world economy and environment. At present US oil is $10 a barrel cheaper than the world average but is not for sale abroad. America has used its might in agriculture and pharmaceuticals to run roughshod over the globe. Because it has held the economic power America has the political power and has used it to their benefit. Why would China / India be any different? www.economist.com/news/united/2015/04/02

Moreover, it was the market that has brought us to this jammed road intersection and, still pursues a profit before people mentality. The market is about satisfying the demands of the 1%. The poor, the world over, still get scraps from the table.

Furthermore, the notion that developing countries need to push forward with industrialization to counter poverty is such balderdash. Recent demonstrations in Brazil and Venezuela and many parts of Europe prove categorically that the poor do not share in the wealth of the nation. Both China and India have horrific records when it comes to alleviating poverty. Or giving due consideration to the environment.

According to Reuters.com 2015/04/13 China will overtake America as number-one in carbon emissions and will do so this year. India is expected to leapfrog Russia into fourth (4th) place in the deadly table. Both countries, assuming present trends will surpass America and the EU together.

China has recently been accused of dumping chemical waste in Inner Mongolia. In a report for france24_en Observers, when the villagers protested they were met with rubber bullets and tear gas. Farmers from Doquintala village have reported that their crop is reduced by 33% and, the fruit trees have died. The ground water has been contaminated and instances of cancer and thrombosis have sharply increased over the last decade. For me Rodrik’s argument that we can ‘reasonably expect’ does not stack up. Check my post on Rodrik and India: No ‘Cover’ for Child Labour

It is a bazaar situation, this whole concept of carbon credits. The West gives the credits to developing countries and then buys them back. Some may suggest that its charity but it is not; there is profit to be made on both sides of the transaction. Bet you can’t guess who takes the larger slice of the cake.

thXJDRNI6QWhat is happening is that we are walking our way through an ocean of sludge because we don’t know any better. We are tied into the neoliberal economic school of thought; within which the market is enshrined in a golden casket that cannot be tampered with for fear that a world calamity will unfold.

Sadly it is a belief shared by many of our leaders and by powerful international bodies: UN, International Monetary Fund (IMF) and the World Bank. As far as they are concerned the market is the prime motivator for change. These are people with clout; they are in effect the Praetorian Guard of the 1%. The super rich, the big boys!

However, it is not just the developing nations that are screwing up our planet. Australia has made a hash of the coral reef and every nation has contributed to the shrinking of Antarctica. Where are our defenders, the peoples’ army? My next post will look at these and other contributing issues.

Do some good…….join Robin Hood

 

 

He’s Here!

 

thCAAXS9NGShush! Don’t make a sound. Don’t stand up! He’ll put you down. Big Brother has arrived. His arrival is much later than envisaged by 1984 author George Orwell, neither did Orwell anticipate that the controlling hand would stem from a democratic rather than a totalitarian regime. Few could have foreseen the rise of the troika, renamed ‘The Institution’.

Poor Greece it doesn’t stand a chance against the might of the EU and its enforcers, the troika, the faceless: the European Commission (E Comm) the European Central Bank (ECB) and the International Monetary Fund (IMF) all unelected. It is their way or the highway.

This is your Europe where democracy does not matter, where decisions will be made for you. The democratically elected government of Greece tried to uphold the principles by which it was elected but has been brow beaten by ‘The Institution’. Greece wanted to opt out of the austerity economic plan followed by the rest of Europe. The new government wanted to reverse the savage cuts imposed on its workers by ‘The Institution’.

As far as the faceless are concerned there is no alternative to their adopted policy. They are wrong, very wrong. I can point them to two Nobel Prize winning economists, a Harvard university economist and a Cambridge university economist who all advocate a positive alternative to the austerity / neoliberal model now in force.

    • J.E. Stiglitz, The Price of Inequality
  • Paul Krugman, End This Depression Now!
  • Dani Rodrik, The Globalization Paradox
  • Ha-Joon Chang, Economics: The User’s Guide

 

Greece did not cause this mess, though the propaganda would have you believe otherwise. What Krugman p177 calls the Big Delusion when he points out that Ireland and Spain both had budget surpluses and low debt prior to the banking crisis of 2008 but ended in the same bog as Greece. So it was not that Greece spent more than it could afford. Krugman p179 goes on to suggest that the political, financial and banking leaders are deeply committed to their version of events. Others may define their logic as ‘groupthink’.

A large part of the blame rests with the introduction of the € euro currency but they will never admit their complicity in creating a mess. At the time of the discussion to adopt the euro many pointed out that while America had a good model, “Europe fell far short of that model”. Krugman p173   Stiglitz p30 is equally scathing in stating that there was no “…political or institutional arrangements to make it work, and they will pay a high price for that failure”. I think we can all agree they are.

Moreover, it’s not just Greece that’s in trouble: Ireland, Portugal, Spain, Cyprus and Italy are trapped in the same bog. These nations have opted to wield the axe and cut the life blood of so many families by cutting jobs by the thousand, cutting welfare, lowering wages and refusing to increase the minimum wage and allowing privatisation which entails job cuts.

Ha-Joon Chang p105 therefore concludes, “With the austerity budget, the prospect for economic recovery in many of these countries is dim”. That they might even face a ‘lost decade’ as Japan suffered in the1990s and Latin America 1980s. The point is supported by Krugman p186, “…deficit countries have been required to impose…draconian…spending cuts and tax hikes—programs that push them into deeper slumps…” Krugman p42 suggests that the ‘Institution’ should look at the work of past economists e.g. John Maynard Keynes, Irving Fisher and Hyman Minsky to find an alternative to the neoliberal austerity package.

Why Austerity?

The IMF, the World Bank and the Federal Bank of the USA are commonly referred to as the Washington Consensus as these are the guys pushing the neoliberal model, free trade and globalization. Rodrik p171 opines that it is a “damaged brand” and has abundant evidence to support his statement.

The role of the IMF is quite confusing:

  • In the years 1978 – 2009 the IMF found 173 cases of fiscal austerity in advanced countries, “And what they found was that austerity policies were followed by economic contraction and higher unemployment”. Krugman p237
  • In February 2010 the IMF document Rethinking Macroeconomic Policy, suggested that central banks such as the ECB in Europe “might be better to aim for 4% inflation rather than the 2% or less that has become the norm for ‘sound’ policy”. A policy of ‘groupthink’. P161
  • In 2011 a study by the IMF found that inequality in income affects the economy on the demand side and suggests that ‘reduced inequality’, the reverse of austerity, can lead to sustained growth. Stiglitz p114

The conclusion drawn by Stiglitz p288 is that, “The worst myths are that austerity will bring recovery and that more government spending will not”. Support comes from the Organisation for Economic Cooperation and Development (OECD) “…income inequality has a sizeable and statistically negative impact on growth”. Guardian 14/12/09

Nonetheless we find the IMF as part of the ‘Institution’ that is promoting austerity in Europe. Who are the faceless that they can disrupt the lives of millions and simply walk thILH29564away with their own pockets filled? Stiglitz p290 condemns them as akin to blood letters of the Middle Ages who cut to release bad blood and when the patient didn’t recover argue that more of the same was needed. They are fixed in their opinion. Groupthink!

 

“Groupthink is one of the most dangerous traps in our decision-making. It’s particularly likely because it taps into our deep social identification mechanisms – everyone likes to feel part of a group – and our avoidance of social challenges. But consensus without conflict almost always means that other viewpoints are being ignored, and the consequences of groupthink can be disastrous”. (p137)

Dr Nicky Hayes, Understand Psychology

A telling point by the author comes with the observation, perhaps tongue in cheek,     “…our understanding of what it is and how it happens doesn’t seem to stop politicians and others from doing it”.

The Greek people were not alone in rejecting austerity the Netherlands and France voted out pro-austerity parties in 2012. A year later the Italians did the same. Chang (p106) It will be interesting as other elections come up how the people will respond but will it make a difference. The ‘Institution’ has set its parameters and seems unlikely to budge. Can people power move them? Or are we powerless against the ‘bureaucratic order’. He’s Here. Are we witnessing the start of the overt rule by the faceless? Democracy, write it in your diaries for your grandchildren to read.

Do some good—————–join Robin Hood.