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The dated conversation

People are shocked! “Shocked” at gas prices. How long have we been having this conversation? Corollary – how long have we been avoiding this conversation?

Obviously, everyone and their mother is mad, mad, mad about the high price of gas, in part because Americans now are back to driving just about as much as they did before the pandemic. We’re not going to the office, but we’re not staying home. From Virginia to Colorado, drivers are liable to pull up to the pump and be greeted with a sticker of Joe Biden, pointing at their total: “I DID THAT!”

A look back at 2011 suggests an interesting counterfactual: What if, facing those high prices, we had made changes on the demand side instead? Believe it or not, this was what some people thought might happen. President Barack Obama took that moment (and the conditions created by the auto bailout) to set new Corporate Average Fuel Economy standards, known as CAFE, which put in place ambitious fuel efficiency goals for automakers. “Slowly but surely Detroit is shifting its attention from SUVs to cars,” All Things Considered reported in March of that year.

You won’t believe what happened next! It’s all ugh. I don’t wish anybody ill on this point. It’s certainly not enjoyable to being filling up on $4.39 per gallon multiple times in a week, but come on. The conversation about more roads all-the-time, living rilly rilly far from work, school, shopping goes back quite a bit farther than 2011. It’s not just smaller cars but a whole suite of living conditions that continue to be – ta-da! – unworkable, which should be the new unsustainable. The larger unworkable situation – sprawl, mostly non-existent public transit, and yes, gigantic vehicles – makes $4 gas that much more painful, as well as Groundhog Day all over and over again.

[You] Make it stop.

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Of Yachts and Fossils

Who ever knew it, but seizing yachts is very popular! And despite the reporting that will tell you that they are impossible to re-sell, as if that makes the seizures moot, taking the oligarchs’ prized possessions scratches a weird itch in the afflicted that actually bothers the comfortable if you know what I mean and I think you do. These are ridiculous manifestations of not only conspicuous consumption, but also conspicuous waste. It also beggars belief that no useful purposes can be devised for these vessels.

Anyway, to the broader situation of Russia, and trying to strangle their economy without strangling the world economy – unless we de-fossilize our energy sources, the former will always be the latter:

This is a coherent platform for left-of-center parties across the globe: a law-and-order crackdown on international kleptocracy, and mass electrification and renewable energy to weaken the repressive and despotic petrostates. It is not a quick fix (though confiscatory wealth taxes ought to work quickly enough), and it is perhaps not as viscerally satisfying to our bloodthirsty pundit class as more fighters and missiles. But in the medium term the “solution” to the “problem” of Russian aggression is not trying to surgically crash their economy while protecting ours (an impossible tightrope to walk so long as high-income nations fail to quit fossil fuels). It may be impossible now to use Apple Pay to ride the Moscow Metro—it may even be impossible, temporarily, for particular Russian-born billionaires to anonymously purchase London pieds-à-terre—but it is still very easy to take the money you made selling natural gas to Berlin and ask a lawyer in New York to explain how to hide it it in South Dakota. The only sensible Russia policy is to make it unprofitable to be the sort of state it is. This approach would also have the side benefit of improving the sorts of states all of us reside in, and perhaps even of saving human civilization. Defeating Russia, by necessity, requires defeating fossil capital.

via.

Image: Andrey Melnichenko’s SY A sailing yacht that at least looks like a sail boat.

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No emissions travel to a war zone

Or if not to a war zone, in close proximity to one. This seems far less a question at this point than an eventuality, but… will the last vestiges of fossil fuel domination burn furiously right up to the borders of energy transformation? The physical proximity of Russia and Norway hide the light years in distance they are from one another in ways that should make us wonder about the elasticity of time:

a new study by the Clean Cities Campaign, a coalition of non-governmental organizations, which analyzed 36 European cities on factors such as road safety for pedestrians, access to climate friendly transportation and air quality. The research found that Oslo is making the most progress on wiping out mobility emissions, followed by Amsterdam and Helsinki. Naples and Krakow had the lowest scores due, in part, to congestion. The financial hubs Paris and London ranked fifth and 12th, respectively.

Meanwhile, bombs, missiles, troops, and chaos for civilians in Ukraine. We may think this is about a crazy person’s LOOK AT ME obsession and not a ‘war’ for resources, but without the latter, there is no source for the former. His delusions are being fueled by the old standbys, in addition to resentment and authoritarianism.

Dammit.

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Nostalgia for Normal

Lots of talk/pixels about ‘getting back to normal,’ the ‘new normal,’ and returning to a time when things/life were somehow better because they were usual. Primarily related to the pandemic, it’s also an opportunity to unpack a sympathetic but highly questionable sentiment. So this interesting tweet, highlighted by Bloomberg, serves as a good remedy for that nostalgia for normal:

Happy talk about way-back-when presents recklessness on many fronts – political, racial, economic – but it is also woebegone in terms of environmental devastation and the slow thoughtlessness that has brought us to exactly here. No one* wants to go back to Jim Crow and no one should want to go back to the normal, daily burning rates of our fossil-fueled civilization. As the article demonstrates, and this is a note to hit over and over again, the [high] costs of slowing down and reversing the effects of climate change are actually a bargain. Slice it however you want – we’ve already gotten far closer to the tipping point of better and cleaner far faster than imagined. Looking away and ignoring now requires more effort. That normal is depressing – and it should be. Our calculations of the impacts of the burning have become far less abstracted, to the point of easily transposing the impacts of the Deepwater Horizon disaster onto methane well leakage and carbon emissions just by looking at the numbers.

Unfortunately, our numbness to the staggering total of COVID deaths resembles our shruggy attitude to climate-related externalities. We get used to them, consider that state ‘normal,’ and long for the days.

But we shouldn’t, and we can’t go back, the comforting but perilous blindness of ‘normal’ notwithstanding. Instead of normal, how about a different better? As our friend says, Don’t Be Afraid.

*Admittedly, sometimes my optimism overwhelms

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Re-Tooling Demand

This Financial Times article (subscription req’d) pulls back the curtain on rain forest destruction in Brazil to let us see what – and who – it’s all for:

At the recent UN climate summit in Glasgow, more than 100 national leaders committed to halt deforestation by 2030, and 30 financial institutions, including Storebrand, promised to eliminate the harmful practice from their portfolios by 2025. However, the signatories, including Brazil, Russia and Indonesia, did not indicate how it would be implemented or tracked, and environmental campaigners remain sceptical.

ADM and Bunge are among the world’s largest traders moving Brazilian soyabeans around the world. The increase in production of the commodity, largely used for livestock feed, has been a leading cause of deforestation of the Amazon rainforest as well as the destruction of Cerrado savannah.

The scale of soyabean production on deforested land and differing standards about what qualifies as acceptable activity makes tackling its presence in supply chains challenging for companies.

Both Bunge and ADM strengthened their deforestation policies last year in response to calls from shareholders. Storebrand, together with US fund manager Green Century, tabled a proposal at Bunge’s annual meeting asking it to tighten its policies, which was backed by 98 per cent of shareholders. Bunge has said it is committed to not having soyabeans from illegally deforested land.

As much as even the big fund managers and many governments get on board with divestment and ESG priorities in managing portfolios, this really points up the issue: the companies – and countries – who burn and mine for profit just aren’t going to give it up as long as it’s profitable. The whole ‘fiduciary responsibility to shareholders’ is baked into our ethos, as long as there is money to be made, dividends to be paid, stock to buy back, whatever.

For allies in COP26 and elsewhere, the approach has to include the goal to dismantle, and then re-assemble, the demand side. It’s worth being realistic about this – otherwise, we remain [eternally? That’s optimistic – ed.] captive to supply-side economic logic. As the ADM example highlights, the companies will never lead anywhere besides mining, digging, clearing, and burning.

Image via FT.com © Ricardo Beliel/Brazil Photos/LightRocket/Getty Images

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Abundance of scarcity

That’s where we are now, or one of the places, so sayeth Matt Levine:

Basically it is easy, using blockchain technology, to create scarce claims. You could I suppose use this technology to create scarce claims to scarce resources: You could put, like, housing deeds or shares of corporate ownership or cargo-container manifests on the blockchain. This would — people have argued for years — have benefits in terms of efficiency and legibility and tradability. It would create value by improving the processes by which real-world assets are transferred and allocated. Classic financial-services stuff. Nobody talks that much about this anymore.

Instead, people like to use blockchain technology to create scarce claims to abundant, or infinite, resources. There is absolutely no shortage of JPEGs, they are infinitely reproducible more or less for free, but that means — or meant — that you couldn’t become a millionaire by having good taste in JPEGs. But now people can create a unique non-fungible token representing ownership of a JPEG and use it as a status symbol or a speculative asset. Nobody will pay you for a number in your computer’s memory, but people will pay you for a scarce number in your computer’s memory.

Stop shaking your head – it’ll hurt your neck. Or just wait.

Theoretical normal person: If you could do a thing that wasn’t just bad for but ruinous to your country’s political system – but it was very good for your profits, would you do it?
Our actual media: Do what?

Such is our national media paralyzed on the question of how to cover Biden, how to normalize authoritarian white nationalism and get Trump back. Ratings are down and they’re in a bad way, which means they’ll gladly put us [all] in a worse one to keep the eyeballs rolling in and the clicks coming.

It’s really something.

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EPA nixes ‘grandfathering’

Reporters and editors don’t especially like big, boring problems – they can be difficult to explain, taking up a lot of words and lacking dramatic photos and illustrations. So kudos to Slate for pulling out this new EPA rule nugget that actually matters – a lot.

But the new methane rule goes beyond merely undoing the damage of the Trump years. The proposal is broader than its Obama-era predecessors, and once finalized, will apply to hundreds of thousands of previously unregulated emission sources, like wells, storage tanks, and compressor stations. That is because unlike the prior standards, Biden’s rule will cover equipment of all ages. EPA thus avoids a key conceptual error that has undercut agency initiatives for over five decades under administrations of both parties: The old rules regulated only new facilities, while exempting older ones from emission limits. In contrast, Biden’s rule covers new and old emitters alike.

And methane, the primary ingredient in natural gas, is a big problem. The gas has a startlingly powerful greenhouse effect when released directly into the atmosphere, trapping 86 times more heat over a 20-year period than an equivalent amount of carbon dioxide. As a result, while methane accounts for only 16 percent of global greenhouse gas emissions, it is responsible for almost a third of current, human-caused warming. And here in the United States, oil and gas installations are the largest industrial source of methane, due both to leaks and intentional venting during the production process.

The Obama administration recognized the need to reduce methane emissions from the oil and gas sector back in 2016 and crafted regulations to do so. But those restrictions applied only to equipment constructed in 2015 or later, leaving the vast majority of the sector’s sources and emissions uncontrolled.

This story was troublingly familiar. Regulating new sources of pollution strictly and existing sources laxly or not at all is known as “grandfathering.” The EPA has engaged in the practice before, with disastrous results. Indeed, we wrote an entire book about the terrible consequences of exempting existing power plants from 1970s emission limits on soot- and smog-forming pollutants.

On the subject of other troublesome old mistakes, the EPA had no comment about toxic emissions emanating from all the crazy uncles still out there. Sources say they continue to study the issue.

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Luxury, re-imagined

At the risk of sounding like some past (and very likely coming to screen near you in the adjacent soon) Mercedes Benz and/or other brand advertisement, the luxury of being in a position to do something about climate change is also a handy rationale to not do that something. Worry over the future of polluting industries and their investors as equal to concerns about the planet implies a false choice. And we love those:

Sorry, but there is no Trump Light, or Trump without the fill-in-this-blank. It’s only a sleep walk into fascism, sorry. Listen to what they run on. Banning Beloved would only be a starting place.

Meanwhile in Scotland, some of our betters are engaged in the COP26 think-scussions:

Humm recently shifted Eleven Madison Park from an omnivore’s menu to one focused on plants, a change that took effect this summer after his restaurant reopened from the coronavirus pandemic shutdown. Hearst has focused much of her energy on reducing waste in the New York design house that bears her name, as well as at Chloe, the Paris-based luxury firm where she is creative director. In October, Chloe became a certified B Corporation, which means it meets independent standards for environmental and social performance, as well as transparency.

“It’s not only about climate change, but it’s also about what does luxury mean,” Humm says about their upcoming conversation in Glasgow. “I think we both realize that, you know, not everyone — or only a few people — have access to our restaurant or Gabriela’s clothes. But we do have these incredible resources and this incredible platform that people are actually paying attention to.”

“Some of the ideas of luxury are old ideas that have to be refreshed,” Humm continues. “For example, we are still celebrating caviar as a luxury ingredient … and there is nothing luxurious about caviar. It’s farm-raised. It’s flown in. It’s not rare at all. And it doesn’t even taste good. This is an old idea.”

A future is not THE future. Reckoning with the many complications of the actual problem of a warming planet caused by out-of-control carbon emissions will re-define luxury, and perhaps even put the concept out to pasture. We will realize that enjoying privations is not luxury but sociopathy. Basking in a scarce resource – whether it be time, security, clean water, or perceived reasonableness – has to be treated as wasteful, if not immoral. Like shrugging before you give your vote to a soft authoritarian. That’s a luxury you can’t afford.

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Climate in the Weather Space

F*x news is preparing to channel (sorry!) the weather forecasting and reporting sphere when it launches a round-the-clock weather streaming service next week. Potential problems with this seems quite obvious and the WAPO is only so successful in getting network executives to talk about how (and whether) the service will cover climate change in the context of extreme weather events:

For Fox, which has seen sponsors inch away from its more polarizing political content, weather offers a potential way to hook viewers without turning away advertisers, analysts say. But questions linger as to how the streaming service will cover climate change, given Fox News’s history of questioning the seriousness of climate change and how much humans contribute to it. Asked in September whether human activity played a role in recent extreme weather, contributing Fox News meteorologist Joe Bastardi said that “at the very least, you can’t tell what CO2 is doing.”
A landmark U.N. climate report published in August details “unequivocal” evidence that human activity is warming the planet by emitting heat-trapping gases, primarily carbon dioxide.
Fox Weather declined a request for an interview with one of its executives but has indicated that it will treat climate science more seriously in its new endeavor. Echoing recent remarks from Fox News Media chief executive Suzanne Scott, Sharri Berg, the longtime Fox executive now heading Fox Weather told Variety, “If you’re asking about climate change, climate change is part of our lives. It’s how we live. It’s not going to be ignored,” adding, “we will be reporting facts.”

Okay, so… what are they? Wait – show, don’t tell, remember? But this might be the most revealing aspect of their devious plan:

But, she added, Fox Weather will be courting controversy however it covers climate change. If the service reports accurately on climate science, it could alienate core Fox News viewers, who have been primed to question it, Fisher said.
“There is a line that they are going to have to walk to keep advertisers feeling like their brand is safe there but not going too far away from their base,” she said. “If something major happens, like a hurricane or a heat wave, all eyes are going to be looking to them to see how they are characterizing it.”

Reassuring bullsh*t and attacking liberals in the face of climate catastrophes will not be helpful. So this venture will either be truthful and short-lived, or profitable and very harmful. Teach the controversy all you want, but – there’s no whether.

Image: Thomas Hart Benton, Spring Storm, 1958. Tempura on board.

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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.