Almost as If

Dr. K brings the medium, sensible heat today regarding Russian failures in Ukraine. It’s a good explainer without the jingoism, importantly including the economic offensives alongside the military ones that have been less than dispositive, or perhaps more so depending on your rooting interest.

But the kudos to Europe for not only resisting energy blackmail but in so doing, also for revealing that the planning and execution of the energy transition are well under way:

So what can we learn from the failure of Russia’s energy offensive?

First, Russia looks more than ever like a Potemkin superpower, with little behind its impressive facade. Its much vaunted military is far less effective than advertised; now its role as an energy supplier is proving much harder to weaponize than many imagined.

Second, democracies are showing, as they have many times in the past, that they are much tougher, much harder to intimidate, than they look.

Finally, modern economies are far more flexible, far more able to cope with change, than some vested interests would have us believe.

For as long as I can remember, fossil-fuel lobbyists and their political supporters have insisted that any attempt to reduce greenhouse gas emissions would be disastrous for jobs and economic growth. But what we’re seeing now is Europe making an energy transition under the worst possible circumstances — sudden, unexpected and drastic — and handling it pretty well. This suggests that a gradual, planned green energy transition would be far easier than pessimists imagine.

Read or listen to (not recommended!) the business news any day of the week and everything any normal person would consider good news – strong jobs report, tight labor market, increased consumer protections, penalizing reckless banking and investment behavior – is all cast in terms of doom and gloom. The sky is always falling and we can’t do this or have that and so stop wanting it and vote for more oppression of the powerless. Kick down, pull up the ladders, that’s all we can do.

What if – and yes, caution, slight optimism ahead – all of that is itself just a form of corruption? The fossil fuel industry, just as an obvious example, has been assuring us since the 1970s that it just can’t be done, there is no way to replace coal as our primary energy source, so stop trying. Wind stops blowing. Solar? Have you heard of nighttime? It’s too expensive, too impractical, is itself bad for the environment. Birds! Plus, people hate to see windmills. They don’t want electric cars. Meanwhile what has happened? What is happening?

What if we decided to get even more bold, rather than cowering in fear about what we’re afraid to do, that we are reminded we can’t do? What other issues out there might not be so inviolate?

Guns?

Really Gross Domestic Product

Leading the index alongside racism, guns, and the forced birth, it’s pandering. And it’s not even close.

Dr. K takes on rural rage in a column this week:

In terms of resources, major federal programs disproportionately benefit rural areas, in part because such areas have a disproportionate number of seniors receiving Social Security and Medicare. But even means-tested programs — programs that Republicans often disparage as “welfare” — tilt rural. Notably, at this point rural Americans are more likely than urban Americans to be on Medicaid and receive food stamps.

And because rural America is poorer than urban America, it pays much less per person in federal taxes, so in practice major metropolitan areas hugely subsidize the countryside. These subsidies don’t just support incomes, they support economies: Government and the so-called health care and social assistance sector each employ more people in rural America than agriculture, and what do you think pays for those jobs?

What about rural perceptions of being disrespected? Well, many people have negative views about people with different lifestyles; that’s human nature. There is, however, an unwritten rule in American politics that it’s OK for politicians to seek rural votes by insulting big cities and their residents, but it would be unforgivable for urban politicians to return the favor. “I have to go to New York City soon,” tweeted J.D. Vance during his senatorial campaign. “I have heard it’s disgusting and violent there.” Can you imagine, say, Chuck Schumer saying something similar about rural Ohio, even as a joke?

Not without conniptions from across the spectrum, including the so-called liberal media – which would probably be leading the charge for apologies. That’s a sort of reflexive pandering that doesn’t even work, performance that no one believes nor allows credit but still happens. And it provides confirmation for the entire industrial pandering complex to double their efforts.

All the hokum about IRS funding we’re about to hear, in the same breath as concerns over budget deficits no less, is merely beating a drum that has been fine-tuned. A lot of this malfeasance lies at the feet of journalism schools and the savvy of corporate media. Politicians who are supposedly afraid of men in dresses and American history now traffic exclusively in hate, and whether it’s performative or not matters not a whit. The results are the same.

Rural voters and the politicians who fan their rage may also be entitled to find out that patience for their antics has limits. Like children, they are absolutely in search of them.

Image: Calculus 1, intro to limits, via the internet

How to stop running if you hate it so much

Reverse of this real story in the WAPO. I mean, really.

When companies/governments go quiet about their so-called ESG efforts, whether it’s investing or actually taking steps to reduce their carbon print(s), to avoid criticism and backlash well, you know we are once again through the looking glass:

The phenomenon, known as green hushing, has become pervasive even as businesses set more ambitious internal targets, according to a survey by South Pole, a climate consultancy and carbon offsets developer.
South Pole surveyed 1,200 large companies from 12 different countries, all of which have set net-zero targets and more than two-thirds of which identify as “heavy emitters.” It found that although a majority of companies have set science-based targets to help them deliver on their commitments, 23% “don’t plan to publicize” them.
The findings suggest that the stigma of so-called greenwashing, where a company exaggerates its green credentials, is so feared that executives will do anything to avoid being accused of it. Being labeled a greenwasher brings with it reputational harm, financial damage and, increasingly, the scrutiny of regulators. And once tainted by such allegations, companies can struggle to resurrect their reputations.

But green hushing also comes at a cost, South Pole said.
“More than ever we need the companies making progress on sustainability to inspire their peers to make a start,” said Renat Heuberger, chief executive and co-founder of South Pole. “This is impossible if progress is happening in silence.”

So, it’s a preemptive PR move, if that makes you feel any better (Ed: it doesn’t). But it does remind us who/what companies serve first – their reputations. If everything is done for optics, what are we ultimately looking at? Much less seeing. We do well to keep this in mind across many contexts – which news stories, politicians, examples of corruption, coups d’etat get more play – all are choices. There’s nothing celestial about which news makes headlines. Someone decided.

It’s much the same with these companies who decide that ‘being quiet about it’ is just another tool in their climate tool box. People and planet need confirmation, verification, allies, and affirmation.

Apologies to Dylan Thomas but Do not go quiet into that good night,

Skins in the game

sidewalk plaque in Charlottesville, Virginia plaque featured chalk graffiti added by local artist Richard Parks.
(Courtesy of Richard Parks)

As if we need reminding (ed: we do!), set aside how much we hate women and remember how racist we are! The discussion about American universities – especially our oldest, most venerable institutions of higher learning – and their deep connections to slavery has barely begun to break through, even and especially at our oldest, most venerable institutions. So, while the public remains largely unaware of the history, we might wonder how universities have for so long escaped scrutiny about the past – about how they were built, how they succeeded, who they succeeded for, and how so much of this was connected to buying and selling people to use as free labor. The NYRB dives into a four new books, and sets the stage rather clearly:

One reason, perhaps, that academic institutions were spared from scrutiny was that they seemed, by design, to be physically removed from the vulgar transactions of commercial life. The trading houses where merchants contracted for consignments of cotton, rum, molasses, and human chattel; the insurance firms that indemnified slave owners for loss of human property; the clothiers that manufactured coarse smocks for enslaved field hands—all these were likely to be found among shops and markets, close to the banks from which they obtained credit and the wharves where human goods were loaded or unloaded for sale.

Think, on the other hand, of our early colleges: Harvard on its bluff above the Charles River, or Yale looking across New Haven Green toward the Long Island Sound, or Brown atop the heights of Providence. Their architecture (ecclesiastical) and setting (pastoral) seemed to say, “We stand above the fray, removed from the workaday world, in a high-minded sphere of our own.” For people like me whose shelves are filled with books about these colleges, it’s not a bad idea to paste a note every foot or so along the edge of the shelf bearing this reminder from the novelist James McBride: “The web of slavery is sticky business. And at the end of the day, ain’t nobody clear of it.”

And friends, of course it’s not just the Ivies. The preponderance of screaming denials (CRT!) and counter-recriminations (Woke!) arise out of fear and cowardice about facing this history as it bleeds to profusely into our present. Can’t stop the bleeding without finding the wound, cleaning it carefully, repairing as much damage as possible, dressing it and providing all available care for full recuperation. Only then can we attend and check on the healing.

Image via WAPO

Shop ’til you stop

Insightful NYRB review of two new books about life in a slower economy. It’s NOT that things will necessarily be so much worse when we are spending less, driving less, burning less – they won’t be worse. It’s just the transition to consuming less itself we consider to be so painful as to be unthinkable. We’re such babies:

Generations of economists, meanwhile, have insisted on the goodness of economic growth and warned that any significant drop in consumption would vaporize jobs, leaving millions if not billions of people without a means of supporting themselves or their families. (Margaret Thatcher’s well-known phrase “There is no alternative,” sometimes shortened to TINA, refers to the assumed necessity of perpetual growth.) The resulting dilemma, as MacKinnon puts it, is that “we must stop shopping, and yet we can’t stop shopping.”

Rather than dismiss this conundrum, MacKinnon seeks to complicate it. Whose jobs would be lost, and for how long? How could societies and their economies adapt, and what could they gain in the process? How would other species react to quieter, less polluted habitats? To begin to answer these questions, he proposes a thought experiment to economists, entrepreneurs, and others: Say that on a single day not long from now, consumer spending falls 25 percent. What next? Predictions in hand, MacKinnon seeks real-world equivalents, finding disparate places and times where conditions similar to those of his thought experiment have already come to pass.

This approach, which might be called speculative journalism, was memorably employed by Alan Weisman in his 2008 book The World Without Us, which MacKinnon credits in his acknowledgments. To conjure a planet precipitously vacated by humans, Weisman interviewed architects, engineers, ecologists, and others qualified to forecast the fates of abandoned cities, farms, and forests. He then visited deliberately unpeopled places, such as the Korean Demilitarized Zone and the United Nations–controlled buffer zone between the Turkish and Greek sides of the island of Cyprus. In a kind of reverse archaeology, both Weisman and MacKinnon assemble shards of past and present into plausible futures. The most obvious difference between their thought experiments is that MacKinnon’s became all too concrete: when he was midway through his research, pandemic shutdowns upended the world economy, and the effects of his imagined fall in spending were inflicted on real people in real time.

The Day the World Stops Shopping is neither an economic treatise nor a detailed policy proposal, though it draws on both as sources. It is an enjoyably idiosyncratic tour led by a perceptive, empathetic guide. It assumes that any significant, lasting reduction in consumption will result from accidents and innovations, brought about not by individual households but by loosely coordinated communities, nations, and regions. In this sense, it is both more realistic and more persuasive than any technical argument, for it makes it possible to imagine not only one alternative to endless growth but many.

Lots of important points here, brought us by people who are smarter.

Wait and see

Sort of a corollary of f*ck around and find out. But.. good to see Biden getting serious about supporting Ukraine. That’s a big number and it needs to be. On verra, as they say.

The ‘let’s see if this sorts itself out’ attitude from some western countries – albeit, right now fewer by the day – mirrors the general tendency of the same countries to do very little about climate change. All the while:

Rising seas have long been a threat to coastal cities. New research suggests that cities—particularly in Asia—are sinking as well, compounding the risks of frequent and severe flooding.

In Karachi, land is sinking five times as fast as the sea level is rising, according to the study published this month in Geophysical Research Letters. Manila and Chittagong, Bangladesh’s second-largest city, are sinking at 10 times the rate of the rising waters.

In China’s Tianjin, a coastal city about 150 kilometers southeast of Beijing, the ground is giving way at 20 times that speed.

In those four cities alone, the phenomenon could affect roughly 59 million residents.

The study, which used satellite data to analyze 99 cities around the world from 2015 to 2020, points to groundwater extraction related to rapid urbanization and population growth, oil and gas production, and construction.

The next life you save just might be your own.

Making climate reduction technologies sexy

Or… sexier than ape cartoons.

My head, it shakes. Because no matter how seriously and soberly one might approach the financial dilemma of bringing promising technologies to maturity by broad investments, there are always hand-scrawled love notes, or pictures of pictures, or the newest version of L.H.O.O.Q., not to mention instant toothbrush delivery schemes to entice the ridiculously wealthy or even the passingly prosperous. It’s a problem:

Tony Fadell, who spent most of his career trying to turn emerging technologies into mainstream products as an executive at Apple and founder of Nest, said that even as the world faces the risks of climate change, money is flooding into less urgent developments in cryptocurrency, the so-called metaverse and the digital art collections sold as NFTs. Last year, venture capitalists invested $11.9 billion in renewable energy globally, compared with $30.1 billion in cryptocurrency and blockchain, according to PitchBook.

Of the $106 billion invested by venture capitalists in European startups last year, just 4% went into energy investments, according to PitchBook.

“We need to get real,” said Fadell, who now lives in Paris and has proposed ideas on energy policy to the French government. “Too many people are investing in the things that are not going to fix our existential problems. They are just investing in fast money.”

Even so-called ESG funds and investor movements run the risk of becoming fads, passing, allowing a regression toward the mean, also know as same old, same old. Governments have to do more to leverage current investments and attract new. But there also has to be some boring seriousness to guide the reckless speculation, as contradictory as that sounds. Otherwise, we’re still speculating alright, on something.

Image: Not a new version. Duchamp would be kicking himself

Tales from the crypt(o)

NBA commentator Jeff Van Gundy’s well-placed, near-extemporaneous “back at the crypt” comment notwithstanding, ubiquitous references to crypto currency range from annoying to cloying. Everything about digital money is either scammy or… that seems to be mostly it. Scammy neatly encompasses the over-hyped, Ponzi-schemed, last-one-in nature of the the collection of binary data that necessarily requires us to put all the usual finance-related terms in quotes: “ownership” “collateral” “token” “transaction.” You could go on.

And besides the obvious downsides of NFT’s – from terrific money-laundering possibilities to the proliferation of really bad art – we’d be remiss in not noting crypto’s climate impacts:

Crypto’s overall climate impact remains massive, with certain currencies swallowing up entire nations’ worth of processing power from individual computing units and data centers—much of whose power comes from fossil fuels. The most common form of cryptocurrency mining, proof of work, requires a massive amount of processing power. Alternative mining methods have a mixed track record so far, with some ostensibly “sustainable” mining systems still requiring significant amounts of dirty or clean power. And transacting any tokens across the blockchain, whether an NFT or a Litecoin, sucks up the collective energy feeding into the transaction, no matter the product at hand. One estimate claims that a single NFT trade across the much-used Ethereum blockchain uses enough energy that could power an entire house for several days. And this is all so the buyer can have bragging rights about “owning” an image.

Celebrities who are selling NFTs and also claim to care about the environment: What are you doing? Whatever it is, there sure are a lot of you. Here’s a list—surely incomplete—of luminaries who brand themselves as climate-conscious yet have also been hawking NFTs in some form or the other, ensuring this bizarre digital culture product will linger in the public discourse while possibly ruining the art world, the planet, and our collective sanity.

Not even-close-to-exhaustive list of scam-adjacent proponents at the link. Yes, engaging in yet another form of workaround for doing not the things we need to do about global warming: what are we doing? The climate question at the center of everything, that we’ve been needing to ask for decades, that we still need to answer.

Image: the crypt in question

Ruffling the kleptocracy

In other news – just started a subscription to the FT and wow, there ARE other stories out there. Boring, significant. Anyway, the U.S. is about to ban anonymous shell companies:

The Biden administration’s focus on corruption and money laundering may so far have attracted less notice than its other big policy decisions. But it is the most meaningful manifestation of the US president’s argument that making the economy work for ordinary Americans is intimately connected to US national security and foreign policy interests.

There are many reasons to cheer this turn in policy. First, it is an all-too-rare example of relative bipartisanship in a deeply polarised country. Days before the January 6 attack on the Capitol, the Corporate Transparency Act was passed by overwhelming majorities of the US Congress as part of the annual defence spending authorisation bill. This law will, when implemented, in effect ban anonymous shell companies in the US — a favoured conduit for the world’s corrupt to launder dirty money, as Yellen referred to in her remarks.

Second, the administration means it seriously. The Treasury has issued an implementation rule for the shell company ban. Too often, in the US or elsewhere, good laws on paper have been dead letters in practice, because of loopholes or a failure to put enough resources and political support behind enforcement. This time looks different.

So weird, and not to get/stay meta all the time, but this story even hits the mythical ‘bipartisan’ note somehow, and yet still never rises to the level of the local news. Sure, it was drowned out by a coup attempt, but as the article points out, corrupted government institutions are the very things that abet anti-democratic movements. So, striking back at corruption also strikes a blow in support of liberal democracy. Sounds so quaint, but that’s where we are.

Image: Nicobar spindle shell, typically not itself a threat to democracy.

Theories about ESG investing

This is some serious inside baseball. But it IS October:

If your basic theory of ESG investing is “we will avoid bad-ESG stocks in order to drive up the cost of capital of bad-ESG things,” it seems to be working:

Years of awful returns and pressure from clients to exit from the oil-and-gas business have left fewer and smaller firms able to take advantage of rising prices and help boost production. The unwillingness of some banks to make energy loans has compounded the challenges to boosting energy supplies.

Those left are moving to increase production, but they are relatively small players who won’t be able to make a significant impact on output. Investors are steering capital away from fossil fuels and toward companies that rank high in environmental, social and governance, or ESG, measures.

“Oil-and-gas has seen the worst returns of any sector over the past five years; the returns are volatile and investors feel ESG pressures,” says Wil VanLoh, who runs Quantum Energy Partners, which manages $18 billion, making it one of the few remaining big energy private-equity funds. “There’s been a huge retreat in available capital.”

That’s from Matt Levine’s Bloomberg daily newsletter, talking game about the game. But the idea that ESG investing is maturing, as he says, is an interesting one. If companies and the courts are no longer going to just line up on the side of fiduciary responsibilities as a way to protect shareholders – and hence, the companies that may continue to pollute and spew for profit – that’s at least a change.

Image: Abraham Lincoln: Baseball Theme Currier & Ives Cartoon, 1860.