Talking the Talk on 'Climate Change'

What are we to make of an article by William Hague, a former U.K. Foreign Secretary from 2010 to 2014, that predicts Britain’s armed forces may one day be sent into action abroad to safeguard the natural environment from such predators as oil companies and loggers? Quoted by the Daily Mail from an article in the journal Environmental Affairs, Lord Hague writes:

In the past the UK has been willing to use armies to secure and extract fossil fuels. But in the future, armies will be sent to ensure oil is not drilled and to protect natural environments.

That prediction is startling from several standpoints. To begin with, it could be read as confirming a frequent left-wing allegation—hitherto hotly denied by the British and other Western governments—that in the two Gulf Wars the West intervened not to prevent Iraqi aggression or to stabilize the Middle East but to get its hands on Arab oil. I don’t think that’s true, as a matter of fact, but if it is, it’s a big admission and a big news story. And it was merely the first of several startling predictions.

The Mail’s succinct report was a paraphrase of a 6000-word article, “The Great Convergence,” by the former foreign secretary in a new journal, Environmental Affairs, in London. I don’t suppose Mr. Hague thinks the paper’s summary did any favors to his long and detailed argument which seeks to show how Britain (and by extension the West) should bring about a convergence between its policies on climate, foreign affairs, and towards China to ensure their all-round success.

He may be wrong about the Mail, as I shall argue below, but there’s little doubt that Hague’s article kicks off a serious attempt by the U.K. and international establishments to explain how their policy of Net-Zero carbon emissions by 2050 fits comfortably, even necessarily, into their other principal foreign policies like a missing jigsaw piece.

Go on, give it a try!

The signs of a political influence operation are all there. Policy Exchange is one of three influential conservative think tanks close to the government. Environmental Affairs is an impressive new venture. Its contributors include leading figures from the global climate change establishment and the U.S. foreign policy establishment, notably General David Petraeus. And its first publication arrives at just the point when governments are suddenly nervous of two fundamental political problems with Net-Zero:

For already there are growing symptoms of domestic and international resistance to Net-Zero—as Hague himself points out. His “Great Convergence,” rather like the World Economic Forum’s “Great Reset,” is a rhetorical device to shore it up by combining it with policies supported by other influential constituencies such as the defense establishment and China hawks. Hague’s opening gambit therefore is to establish that climate change is a threat not only to the prosperity of nations but also to their national security and thus to global security as a whole.

That’s a theme increasingly heard from Western governments—and I’ve expressed skepticism about it before. But the former Foreign Secretary said it first in 2010, and he thinks his forecast has been borne out by events:

In Iraq, farmers were driven to join ISIS once opportunities to provide for their families dried up along with local water sources. In Somalia, jihadists have cut off water supplies to punish areas of the country outside of their control. And in Syria, social unrest, exacerbated by droughts driving Syrian farmers into cities, spilled over into civil war just a few short months after my remarks, leaving hundreds of thousands dead and millions scattered across the world.

But the problem with these examples is that they are the effects of civil war, terrorism, and oppressive government rather than of "climate change." It’s possible that climate change may have played a part in making them worse—as the Russian winter complicated Napoleon’s invasion of Russia—but it would never have caused them in the absence of war, terrorism, and oppression. Most of Syria’s neighbors, after all, have helped refugees rather than persecuting and robbing them. And there are far easier and less dangerous ways of adapting to small rises in temperature than press-ganging your neighbors or ethnically cleansing them.

One way to stop climate change.

Not that Hague, a prudent statesman aiming at pacific solutions, is anxious to send in gunboats. His main stress is on diplomacy and trade which he would send in ahead of the troops:

[A]s climate change climbs the hierarchy of important political issues, it will be increasingly difficult to square our climate change policy with agreeing to a free trade deal with a country that clears a football pitch-sized area of the Amazon rainforest every minute.

He's talking here about Brazil, but he could equally be talking about China and coal-powered stations, or Saudi Arabia and oil, or Russia and pipelines. So let’s not underestimate the boldness of Hague’s statement here. It overturns something very important.

Free trade is a central element in the kind of liberal conservatism that Hague, Cameron, and Boris all represent—and that global economic institutions have upheld in practice since the end of the Cold War. It’s how they believe mankind makes progress—by developing and trading new ideas and products in peaceful competition between nations. Hague’s willingness to subordinate that method of human progress to the stern sacrifices of Net-Zero shows the extent to which climate policy has become an dogma overriding all other considerations in Western policy. It’s now an unquestionable article of faith.

Yet if we are to base military, diplomatic, and even trade policy on the economic and security consequences of climate change, shouldn’t we also take into account the consequences of the policy of combatting climate change? Governments candidly admit that Net-Zero is likely to impose heavy costs on the economy and to require seriously unwelcome life-style changes from their populations.

But it seems shortsighted and rash to ignore the likelihood that these consequences would create tensions--tensions at least as serious as those Hague predicts from climate change—between different social, ethnic, and religious groups within countries. And that goes double for international tensions between countries.

Welcome to Syria.

After all, the potential international conflicts that Net-Zero seems likely to foster include: angry demands from the developing world for decarbonization subsidies from the West; broken Net-Zero promises from a China surging ahead on cheap, reliable fossil fuels; and attempts by a declining West to compel the rest of the world to implement Net-Zero targets—attempts that fail and prompt airy talk of intervention.

Hence the value of popular journalism—seen here in the Daily Mail’s selective compression of Hague’s 6000 words into one simple conclusion: “In the future, armies will be sent to ensure oil is not drilled and to protect natural environments.” It brings us hard up against reality.

Under whose authority would these troops be sent abroad? Obviously, Hague was not proposing a Western coalition of the willing to halt Brazilian logging or shut down Bahrain. That would be too much like a re-run of the Iraq War for comfort’s sake. There would have to be a U.N. force of some kind under the authority of the Security Council. Consider, then, the following three points:

  1. Russia and China are among the world’s largest energy-producing and energy-consuming countries respectively.
  2. Both countries are also two of the five permanent members of the U.N. Security Council and enjoy the right of veto on any U.N. use of force.
  3. And there is zero chance that either country would allow any U.N. use of force that threatened its vital economic interests.

Indeed, only last month a Security Council debate on whether climate change should be treated as a threat to international security revealed (not surprisingly) that there was support from India and other energy-rich and energy-hungry countries for Chinese-Russian skepticism on the point. Only a very small country is at risk of being invaded by British or other Western troops for crimes against the climate.

Lord Hague makes a fair point when he says about climate policy that Britain "cannot get away with talking the talk without walking the walk" indefinitely. Since we can’t walk the walk in reality, however, maybe we should be a little more careful about talking the talk.

A Royal With Some Sense

In response to the death of Prince Philip, the Duke of Edinburgh, The Global Warming Policy Forum reposted a piece from a few years ago by the (now deceased) British climate skeptic Christopher Booker, entitled "The time Prince Philip wrote to me in praise of my views on global warming."

Written on the occasion of the prince's retirement from public life in 2017, Booker mentioned that he'd been very touched to receive a "long, thoughtful and sympathetic letter" from Philip after the publication of his best-selling book The Real Global Warming Disaster: Is the Obsession with 'Climate Change' Turning Out to Be the Most Costly Scientific Blunder in History? The prince had wanted to correct one minor error in the book which pertained to himself;

I had said he was still a supporter of the World Wildlife Fund, which he co-founded in 1961. In fact, he said, he had withdrawn from the WWF after it switched from its original focus on saving endangered species to relentless campaigning against global warming.

Booker didn't spell out Philip's position on global warming any further than that -- to do so would likely have been to betray a confidence -- but that anecdote, along with a few others (several obituaries have mentioned his recently describing the wind farms popping up all over England as “disgraceful” and “absolutely useless”) paint a pretty clear picture.

Unfortunately, Prince Philp's progeny don't seem to have inherited his good sense. The green enthusiasms of the Prince of Wales are well known. Booker even mentioned that Charles was rather disturbed by his "views on global warming," and that he'd been immediately cut from the heir apparent's Christmas Card list after the publication of his book. We've previously had occasion to comment on the vacuity of Prince Charles's younger son, Harry, and his American bride, la Markle. And his elder son, William, is in on the act as well, recently tacitly endorsing Klaus Schwab’s Great Reset in a recent speech, saying:

All of us, across all sectors of society, and in every corner of the globe must come together to fundamentally reset our relationship with nature and our trajectory as a species.

This generation of royals are clearly grasping at celebrity, which is why they've embraced the self-righteous environmentalism so common among the glitterati. What they seem to have missed is that celebrity and royalty are diametrically opposed concepts, the one obsessed with self-assertion, with proclaiming "my truth," and the other  concerned with duty, honor, and self-abnegation. You don't have to be a monarchist -- I am not -- to appreciate that Philip was a man who embodied these latter qualities.

Britain would be better off if his children and grandchildren took after him.

Net Zero: Cost, Costs, and More Costs

Getting accurate estimates of the costs of going "Net-Zero" from the governments and global institutions that adopted the policy has been a difficult task from the first. That would have been so even if they had been honest and transparent in their accounting. Moving economies from dependence on cheap reliable fossil fuels to reliance on electrification fueled by renewables (i.e. wind and sun) would require massive expenditures on almost every aspect of life.

It also has the potential to be very alarming. If voters learn that the policy will result in higher fuel prices, higher taxes, and the need for them to spend large capital sums to transform their household economies by, for instance, replacing gas-fueled heaters and petrol-driven cars with electricity-fueled ground storage heaters and EVs, they may take fright and decide that the game isn't worth the dim flourescent bulb. Managing voters' opinions has therefore become an important element in the policy. It has to be "sold."

As it happens, the United Kingdom -- which has reduced carbon emissions more substantially than any other country -- has also put together the strongest political coalition in support of the Net-Zero policy. All the political parties represented in Parliament back it. So, overwhelmingly, does the media. So do all the major cultural institutions such as the BBC. Even bodies apparently remote from politics such as the National Trust (which looks after Britain's stately homes) are keen to be seen as relevant to the cause. When the Climate Change Act setting out legally-binding targets for carbon emissions reduction was passed, only five MPs voted against it.

That legislation created a climate change committee, rooted in parliament but independent of the government, and gave it the task of holding ministers to account over whether they have met the carbon reduction targets written into law. Its sixth annual report was issued at the end of last year. And it offers a very useful glimpse into the lifestyle changes and probable costs of the Net-Zero policy which most governments and agencies have been reluctant to publish or discuss in detail.

No, ministers

That's understandable. When wind and sun still contribute only a measly 1.5 percent of global energy consumption, as Matt Ridley pointed out recently, it's hard to estimate the costs of expanding that share to the 94 percent now contributed by fossil fuels of one kind or another. But the costs won't be small. And there will be a great many of them spreading into every area of life since the mere act of living consumes energy and is sensitive to its cost.

To prevent this article becoming an encyclopaedia, I'll examine only three kinds of cost: lifestyle costs, economic costs, and political costs. I have to admit that the committee's report is relatively honest about the lifestyle consequences of net-zero, though it wraps up its admissions in honeyed phrases. Here, for instance, is its cheerful summary of how "we" will reduce demand for carbon-intensive activities:

The U.K. wastes fewer resources and reduces its reliance on high-carbon goods . . . Diets change, reducing our consumption of high-carbon meat and dairy products by 20 percent by 2030, with further reductions in later years. There are fewer car miles travelled and demand for flights grows more slowly. These changes bring striking positive benefits for health and well-being.

And here's my grouchy response to it:

But what if our diets don’t change voluntarily? Or consumers don’t actually like the new low carbon foods predicted here? Or they want to use their cars and fly on vacation more often than the planners predict? Those "striking positive benefits for health and well-being" sound alarmingly like the medical authoritarianism currently running our lives in the fight against Covid-19. Will doctors and other planners change their presciptions if we don't like the medicine? Or will they ration the foods, car trips, and vacations that the consumers (who are also voters) are determined to enjoy?

My sarcasm notwithstanding, these recommended (a.k.a. imposed) lifestyle choices imply heavy economic costs as industry and agriculture change what they now produce in response to market demand to quite different goods and activities prescribed by ministers and civil servants. The U.K.'s decision to prohibit the sale of petrol-driven automobiles from 2030 in order to require a switch to electric vehicles will force both the taxpayer to finance the electrification of the entire country and the driver to buy a much more expensive car.

When we see the scale of this economic and industrial transformation, it's plain that it's a very expensive project indeed. As I pointed out last month, even the committee chairman concedes that if it is to make us richer rather than poorer, then "[l]ow carbon investment must scale up to £50 billion each year to deliver Net-Zero." Not to worry, however, because he also assures us that "our central estimate for costs is now below 1 percent of GDP throughout the next 30 years."

But these estimates were  immediately challenged by Dr. John Constable, energy editor of the Global Warming Policy Foundation, as "entirely divorced from reality":

Some of them are out by several hundred percent, meaning that the claim that we can decarbonise painlessly doesn’t stand up to even cursory scrutiny. Offshore wind is twice as expensive to build as the CCC assumes, and two to four times more expensive to operate. The resulting electricity will be many, many times more expensive than they claim, making the use of heat pumps and Electric Vehicles utterly unaffordable.

So the estimate that net-zero costs will be less than 1 percent of GDP annually for the next thirty years is a fanciful one. Almost all other estimates are higher, some several-fold. Net-zero is a plan fueled not by fossil deposits but by optimism.

And that takes us to the third cost: political costs. These are obvious. Everyone has accepted at the back of their minds that there'll be a price to be paid by governments in power when the higher taxes and energy prices fall due. But that won't be tomorrow or, with luck, before the next election. So MPs never seem to have done the calculation of how heavy the political costs might be -- until last week when the Onward think-tank in London produced an analysis of the political impact of net-zero and discovered that it would be formidably high.

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In particular the carbon-intensive industries most reliant on fossil fuels are concentrated in the Midlands and North of England -- the very regions where Boris Johnson broke Labour's "Red Wall" and won a slew of traditionally Labour sets to swell his parliamentary majority to eighty seats. Johnson has since acknowledged that he had only "borrowed" those voters and would have to justify their trust in him by leveling up their economic prosperity to that of Britain's booming South-East.

What the Onward report suggests is that Johnson's green industrial revolution risks pushing the poorer regions further down the prosperity index rather than levelling them up. Boris Johnson's green agenda is completely at variance with its post-Brexit policy of an infrastructure build-up to as well as being economically regressive

Consider, now, the report's analysis of how this will impact the seats won in 2019 as summarized by the Telegraph:

Some of the biggest concentrations of polluting jobs are in Conservative-won seats West Bromwich West, with 59pc, as well as Hyndburn in Lancashire and Stoke-on-Trent North with 55pc each, according to the Road to Zero report.

The East Midlands has the highest share of jobs in high-emitting industries at 42pc compared to London, the lowest, with 23pc.

The research suggests that up to 10m jobs could need to be replaced, or see workers retrained, as the UK aims to achieve “net zero” carbon emissions by 2050.

What makes this report so interesting is that Onward, a progressive Tory think tank, and the GWPF, a Thatcherite one, now agree on at least one aspect of the net zero policy: It's a political suicide note.

Enemies of the People: Prince Charles

Diary of an Acclimatised Beauty: Testing

Greetings again from Lyford Cay. I’m here at the house of some lovely friends I met at Annabel’s “Thanksgiving” party. I put Thanksgiving in quotes because it was an accommodation for me… a reasonably recent resident of Los Angeles who got quite used to the tradition in just a few short years, and Annabel being my dearest friend-and rather eager hostess, jumped at the chance to out-hostess everyone else.

I’d been holed up in London, in my childhood home, as Covid started cutting into my peripatetic life, and now found myself in Lyford, happily sunning and meeting other wonderful people. There was a bit of a flap over “some Americans” from New York who had a large party and one (yes, one) hostess tested positive. Other Lyfordians were purportedly “furious” but that’s mostly bluster since Americans are always assailed wherever they go. Luckily I can rely on my very posh British accent even if Judith (mummy) says I shouldn’t use the word posh anymore.

No Reset necessary here.

Over cocktails last night I’d met a lovely gay couple from France, by way of California, by way of London who like myself, take a huge interest in the health of our planet. They also live very near where I am staying and are purported to have a pool and ballroom to die for.

I’m looking forward to seeing it and discussing the intersections of our interests, even if I was confused as to why they claimed they’d had to relocate to France just to get married when California had been issuing licenses some five years prior.

They returned today for Christmas brunch and didn’t seem as eager to talk to me as I’d hoped, but I made my way over to them anyway. I was interested to hear their take on the Great Reset, as all I had was one Google search and daddy’s ever-informed dismantling of my shaky facts. They were less passionate about the environment than I’d understood—it was as if last night’s conversation didn’t happen and they seemed only to want to talk about how Covid had marginalised the LGBTQ community. Intrigued I listened. Apparently the Coronavirus had led to “a loss of safe spaces and the gay community was hardest hit”. Or so said Stephen, as his partner ditched us both.

At the risk of sounding like Daddy, I was beginning to think he was right and that the Great Reset affected every agenda the most. Meaning… if it mattered to you, you were affected.

“HOW?” I asked. And Stephen responded,

“Legal rights of trans people have eroded, and young LGBTQ are further harmed by the closure of safe spaces.”

“I see.” I said. Even though I really didn’t. I only knew that Japanese women had succumbed to suicide under Covid-19 in numbers greater than all of Japan’s other Covid deaths combined. I hadn’t heard this happening to any other bastion of society but I asked:

“Could safe spaces not migrate online as others have done?” I asked.

“Online are not safe spaces to be,” he said, “This is where they can face abuse, or get outed.”

And at which point I decided this conversation was nuts, in person-safe, yet online was a risk of being outed? And although supported by the World Economic Forum as fuel for the Great Reset, I wasn’t having it. Clearly NO ONE cares about the planet, least of all the man with the fabulous pool; and his London accent was sounding a bit more Lambeth if you asked me. 

Just then I overheard another conversation about the Great Reset and I nearly flew to their side. It was coming from a tall and very good-looking South African-accented gentleman named Galen. Never mind the sticky Rum Dum Sour dripping down my wrist.

“Hello I’m Jenny and…”

No sooner did I arrive when Galen said, “In the post-Covid Era…”

“Excuse me? I lobbed. “It’s now it’s own era?”

“Well there is no arguing that the Great Reset needs to happen and that capitalism has empirically failed.”

“Well, I believe there is such an argument.” I said,  "and might I present Exhibit A: Lyford Cay.”

“What I am TRYING to say…, he began, “is we envision a better, fairer world, integrating the next generation to be in harmony with nature again.”

“What you are SAYING…is Marxism.” I insisted.

Galen gave me the why don’t you go back to the nursery look which was not going to work on me.  I brushed my voluminous curls to one side and looked at him with fresh eyes. He was trying to convince himself as much as me, and having taken this moment I could see that.

“What I’m saying IS…” He began again, “is we can take the technologies of the fourth industrial revolution and provide everyone with better lives.”

I could hear Daddy shouting in my ear or maybe it was just blood welling in my temples. Better lives? He was just parroting the ridiculous stuff I’d heard from that very mixed- up fellow, Klaus Schwab.

“Fascinating” was all I replied, and before I could take my leave he asked,

“What is it you do?”

“DO???” I responded. “Surely you remember from the pre-Covid era… one does not just ask what one does at a social gathering.”

Happy happy, merry merry.

His eyes steeled against mine and now it was me panicking. I was just not going to tell him I was a life coach… he would never understand the importance.

“My family is in oil exploration. I declared. And speaking of a commitment to making things once again in harmony with nature… fracking.”

I could smell a bit of Rum Dum Sour I’d transferred from my hand into my hair, but of course he couldn’t.

“Anyway… Happy Christmas!” I added. And split.

Toyota Chief on Electric Cars: Slow Down!

The Observer reports on some very striking comments by Toyota Motor Corporation president Akio Toyoda, on the topic of Electric Vehicles. EVs are hot right now, with the automotive industry investing heavily in them, and governments throughout the world (prominently, as The Observer mentions, those of Great Britain and California) looking to aid their development by banning the sale of gasoline and diesel engines in the not-too-distant future.

But Mr. Toyoda is not convinced that they are the answer. At a recent press conference, he pointed out a few problems with the projected shift to EVs. First, he claimed that “the current business model of the car industry is going to collapse" if the industry shifts to EVs too quickly. No word on whether he thinks that the oft-discussed 10-15 year timeline put forward by activists in and out of government falls into that category, but it wouldn't be surprising if that is exactly what he had in mind.

Next, he pointed out that "Japan [for one] would run out of electricity in the summer if all cars were running on electric power." There just isn't enough electricity to go around, especially with battery technology being what it is. He estimated that "the infrastructure needed to support a 100 percent EV fleet would cost Japan between 14 trillion and 37 trillion yen ($135 billion to $358 billion)," a hefty percentage of GDP for a famously stagnant economy like Japan's.

Worth noting that it is a lot cheaper to generate the electricity a given vehicle needs on site -- that is, within the vehicle itself, as a gasoline powered combustion engine does -- than producing it elsewhere and transporting to the car.

And, following up on that point, he called attention to the fact that "most of the country’s electricity is generated by burning coal and natural gas, anyway," so the stated goal of leaving fossil fuels behind by shifting to EVs isn't going to happen. In his words:

The more EVs we build, the worse carbon dioxide gets… When politicians are out there saying, ‘Let’s get rid of all cars using gasoline,’ do they understand this?

Unfortunately the answer to that question is probably "No," both for the politicians and the propagandists in the media.

Is It Me That's Mad, or the World's Leaders?

Yes, I know that the headline should really read “Is it I who am mad—or the world’s leaders?” but the dubious grammatical form used above is better suited to the populist sentiments of this article. And though populism and populist are words routinely used to mean “insane,” “dangerous,” or worse “problematic,” some kinds of populism are in fact social truths that experience has shown to be accurate and valuable, i.e.,  commonsense.

That applies especially to truths about spending, saving, investment, and borrowing. Copybook maxims on that score go from Thomas Jefferson’s “Never spend your money before you have it,” to Shakespeare’s “Neither a borrower nor a lender be/For loan oft loses both itself and friend/And borrowing dulls the edge of husbandry.”

With that prudent advice ringing in our minds, let’s look at how prudently our political masters are handling our collective expenditures, revenues, borrowings, and investments. The first thing to notice (though few do) is just how massive the sums involved are.

Estimates differ but in the U.S., apparent president-elect Joe Biden is proposing a budget of $5.4 trillion equal to 24 percent of America’s GDP. He’s also proposing a smaller (but still massive) tax increase that would leave a gap of $2 trillion dollars for the U.S. Treasury to borrow. But cheer up—it’s bipartisan. President Trump’s budget estimates for 2021 weren’t much lower at 4.8 trillion equal to 21 percent of GDP and a deficit of $966 billion.

Now, expenditures to cope with the pandemic and lockdowns are emergency spending that almost everyone agrees is justified or, to be more precise, inevitable. That’s why the Trump budget rose to an annualized rate of 30 percent of GDP at the height of the pandemic this year. But a cool $700 billion is accounted for by Biden’s “Build Back Better” agenda that would increase spending on infrastructure, the environment, and the Green New Deal. That's equal to one-eighth of Biden's projected total spending for 2021 and one-third of the likely deficit.

The picture is the same in Britain where Boris Johnson’s government, as well as spending vast sums to ameliorate the pandemic and concomitant recession, is embarking on a green industrial revolution and unrelated (even contradictory) infrastructure spending. There too the Labour, Lib-Dem, and Green opposition parties attack these plans as too little, too late. In both countries the general attitude has been Spend! Spend! Spend!

Well, it is -- right?

After all, everyone knows that Tomorrow Is Another Day!

Scarlett O’Hara, Gone With The Wind’s heroine, may be out of fashion in racial politics, but financially she’s never been so enchanting to so many powerful people.

That may be because we simply can’t get our minds or even our imaginations around the figures when they rise from million to billions to trillions. To help us do that, here’s David Schwartz, the science writer and a brilliant popularizer, explaining them to NPR listeners:

The difference between a million, a billion and a trillion is like the difference between eleven and a half days, 32 years and 32,000 years.” Do the sums: a $2 trillion dollar deficit the equivalent of 64,000 years in time measurements.

And an $5.4 trillion dollar total annual budget... or a $23 trillion accumulated national debt... is equal to... but I see the audience’s eyes glazing over... No -- they’re crying.

Now, it’s certainly true that borrowing is economically justifiable and potentially profitable if it’s likely to produce a stream of income or equivalent benefit that over time more than equals the cost of the capital borrowed. A home mortgage is a humble example.

It’s also the case that government investment can be economically worthwhile if it creates an economic environment that hikes productivity, spurs general economic growth, and thereby increases tax revenue for the Treasury. Some state investment meets those criteria, but by no means all. So we should apply certain tests to proposals such as the green industrial revolution and the Green New Deal?

The test that governments seem to like most at the moment is the question:

Can we borrow at a low interest rate?

It’s a fair question but it should be a secondary one. A low interest rate means it’s cheaper to borrow, but that’s a modest benefit at the best of times and no benefit at all if the investment produces less wealth than the cost of borrowing. And if interest rates rise as they tend to in periods of inflation produced by government over-spending, then the modest benefit becomes a horrendous cost, especially when your accumulated borrowing has reached $23 trillion. So the next—or rather, prior—question becomes:

Can we make sure the investment pays off?

To which the honest answer is, No. As the distinguished political theorist, James Burnham, author of The Managerial Revolution, used to say in his rules on life: You can’t invest in retrospect. Some of the visionary Green schemes proposed by Joe and Boris, such as electric airplanes and cheap hydrogen cars, can’t be  invented simply because we establish a state fund to invent them, any more than the flying cars and personal jetpacks of Matt Ridley’s youthful imagination exist today because we wanted them, as he noted in a column on the ten big things wrong with the green industrial revolution.

I quoted the column last week, but it can’t be quoted too often because to judge from government policy no one in Whitehall or the Beltway has read it. It should be especially worrying that many of the schemes for transitioning from fossil fuels to “renewables” all cost more than the cheap fuels they are meant to replace and need state subsidies for longer than their advocates claim in advance. Demands for extended government subsidies should be a warning. Innovations will occur, of course, because a free economy is an innovation machine. We simply don’t know what they’ll be, and if we concentrate state funding on bright ideas too early, we risk being unable to fund the good ones that survive the sorting out process.

But they lift productivity and economic growth, surely?

Again, the proof of the pudding will be in the eating, but the signs don’t look that good. What economic benefit is likely to arise from the total electrification of Britain electric cars require that would match both its cost and the cost of forcing motorists to give up petrol-driven cars from 2030 onwards? If the answer is that we will benefit from the technological innovations that British and American auto manufacturers make in the course of developing cheaper and more efficient EV’S, we could have those benefits anyway by allowing them to make the cars that the motorists want at a price they can afford and at a pace that would allow government and industry to transition in line with market demand changes. Then we might get technical innovations in both EVs and petrol-driven cars.

But, Miss Scarlett, do you really need an electric car?

We don’t do that because the real aim of policy is not technical innovation—that’s a by-product at best—but a reduction in carbon emissions, or net-zero in short. That’s why everyone concedes that electricity prices will rise for industry as well as for consumers, putting the industries in countries with green hairshirt economic policies at a serious disadvantage with their foreign competitors. How will that kind of enforced economic primitivism help us either to raise productivity or to pay back the money we’re now borrowing? It won’t.

Since this is a global problem, though, surely, our competitors like China are making the same sacrifice?

Well, no they’re not, as a matter of fact, and when they say they will, they usually ask “the West” to give them subsidies to do so. In the meantime, the Chinese Communist Party—no idealistic Greens in that Politburo—is bringing new coal-fired power stations on line with emission levels greater than the U.K.’s entire carbon output.

So why are we doing this?

That’s a bigger question to which I’ll return next week. But it certainly requires explanation because unless the laws of economics have been repealed, the policy of spending and borrowing massively in order to make our economies less productive and efficient can only have one result. It was forecast most eloquently by Rudyard Kipling in his once-familiar poem "The Gods of the Copybook Headings":

In the Carboniferous Epoch we were promised abundance for all,
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: "If you don't work you die."

Something to think about.

BoJo's Bizarre Climate Scheme

Boris Johnson's Tories won the 2019 British election in a landslide on the strength of their promise to "Get Brexit Done," but for most of the time since they've been distracted by Covid-19 and by Boris's odd dalliance with climate hysteria. On the latter point, he seems to believe that expending political capital on building wind farms and mandating electric cars will help him maintain his hold on those working class, traditional Labour voters whose support he promised not to take for granted on election night.

This seems a bizarre play, as polling suggests that climate issues are fairly low priority to Brits in those former "Red Wall" seats in the North and the Midlands. Throughout Britain healthcare, the economy, and Brexit remain people's top concerns. A recent survey has what is referred to as the "climate emergency" prioritized by just 23 percent of the populace, and less than that (unsurprisingly) in those working class outposts which the P.M. is targeting.

Nevertheless, Johnson is determined to go full speed ahead with what he's calling Britain's "green industrial revolution." He recently released a 10-point plan, which includes pledges to ban the sale of combustion engine automobiles by 2030, quadruple offshore wind farms by the same year, invest heavily in the development of various "green" technologies, and to transform London into “the global centre of green finance.” This plan, BoJo assures us, will generate "up to 250,000 jobs," and all for the low, low cost of £12 billion!

In response, Matt Ridley has put forward a 10-point demolition in the Telegraph. First off, he points out, that jobs-for-pounds ratio isn't actually that impressive.

£48,000 per job is a lot. Cheaper... to create the same employment erecting a statue of Boris in every town. Anyway, it’s backwards: it’s not jobs in the generating of energy that count, but jobs that use it. Providing cheap, reliable energy enables the private sector to create jobs for free as far as the taxpayer is concerned.

Then there's the fact that Johnson is "hugely underestimating the cost." Among other things, he's relying on the wind industry's own claim that their costs are coming down, when the actual "accounts of wind energy companies show that both capital and operating expenditures of offshore wind farms continue to rise." Should wind energy be mandated, Britain's already high electricity prices will actually increase, which "will kill a lot more than 250,000 jobs."

Ridley makes several more important points, including that the prime minister "misreads how innovation works," and thus foolishly assumes that pumping money into the problem will necessarily generate new technology required to make his plan work. It won't. He concludes,

My fear is that we will carry out Boris’s promised 10-point plan, cripple our economy, ruin our seascapes and landscapes, and then half way through the 2030s along will come cheap, small, safe fusion reactors. The offshore wind industry, by then so stuffed with subsidies they can afford to lobby politicians and journalists even more than they do to today, will suck their teeth and say: “no, no, no – ignore the fusion crowd. We’re on the brink of solving the reliability issue, and don’t worry, the cost will come down eventually. Promise!”

Fingers crossed, no doubt.

Cracks Appear in the Climate Consensus

On the face of it, international progress towards a global consensus on reducing carbon emissions to net-zero by 2050 in order to restrain the rise in world temperature to between 1.5 and 2.00 degrees above pre-industrial levels is about to be resumed after a four-year interruption. When President-Elect Biden overcomes the remaining legal hiccups to take office on January the 20, 2021—as I am assuming he will —his first acts will include returning America to its observance of the Paris climate accords. Since 195 other nations have already signed on to the Accords (and everyone has agreed to treat them as a treaty, even if a non-binding one), it’s full speed ahead to a net-zero carbon world.

Or so it would appear.

This global pact rests on strong support from the world‘s governments which in turn rest on a firm consensus of political parties, scientists, officials, “Green” activists, and the media that a net-zero carbon policy is essential in order to avert a global climate catastrophe. This consensus is so universal that anyone who dissents from it, even a distinguished scientist or a Nobel Prize winner, risks being treated as a dangerous eccentric and finds it hard to get a hearing in respectable forums. Demands are sometimes heard that such people be kept off the airwaves altogether or even prosecuted for “climate denialism.” Fortunately, there are very few such eccentrics.

As green as they come.

Not that those within the consensus deny that the net-zero policy has problems. On the contrary everyone acknowledges that it will require quite heavy sacrifices from the ordinary citizens in their countries in the form of higher taxes, higher energy prices, and lower living standards. But these sacrifices will be worth it not only because they will avert a global catastrophe but also because Boris Johnson’s “green industrial revolution” or (according to taste) Joe Biden’s “Green New Deal” will create well-paying jobs in cleaner green industries such as windfarms.  And the last obstacle to this green utopia in the form of President Trump has now been removed.

Thus ends my rather bland outline of the Authorized Version of climate change politics. If we examine it critically, it surely becomes clear very quickly that it rests on two unsteady supports: the strength of the establishment consensus and the electoral popularity of a policy of transitioning to a net-zero carbon economy. Both seem strong at present. As climate skeptics such as Allister Heath in the London Daily Telegraph have conceded, the elites on both sides of the Atlantic have committed themselves wholeheartedly to the consensus; and a poll taken before the recent U.S. election showed that America voters were greener than ever before:

Seven in 10 voters support government action to address climate change, with three-quarters wanting the U.S. to generate all of its electricity from renewable sources such as solar and wind within 15 years.

In both cases, however, there are grounds for predicting that trouble lies ahead. Take, first, the establishment consensus. That is far from being a spontaneous embrace by almost all scientists and economists (climate policy being a blend of both disciplines) of manifest truths. Nor could it be, for a variety of reasons: science itself offers only provisional truths; climate science alone covers a wide range of scientific disciplines; and even the U.N. IPCC reports offer a range of possible outcomes with varying degrees of probability attached to each.

When its tentative and uncertain conclusions disappear and re-emerge as government policy, they have become firm doctrines (e.g., outlawing the U.K. sale of petrol-driven cars after 2030) enforced by quite strong sanctions: the granting or withholding of official contracts; appointments to official boards, university posts, and the civil service; publication in scientific journals; threats to employment and promotion; and even a de facto censorship of heretics in mainstream and official media. It’s hardly surprising that few people contest the establishment consensus when there are serious risks and no practical benefits in doing so. What’s surprising is that some do.

The whole world is watching.

Who are they? Usually, the first critics of the consensus are natural heretics who look at any powerful structure of ideas maintained by force and try to find cracks in it. Others join them because they may have either economic or intellectual interests in doing so—a naturalist opposes windfarms because they kill birds, for instance.

Some people working to advance the policy discover flaws or scandals in its operations and resign to oppose it from outside. Then there are journalists, natural heretics often, but looking for a good story always. Finally, there are critics who are simply very clever people who notice things and realize they don’t add up. And when all these “types” start examining climate policy and how it’s going, they find all kinds of risks being taken and mistakes being made.

Of course, there have been sharp-eyed critics of  “climate change” alarmism—and of the policies intended to ameliorate it—from the first: former U.K. finance minister Nigel Lawson who founded the Global Warming Policy Foundation, Danish academic Bjorn Lomborg who founded the Copenhagen Consensus Centre, and the late Nobel Laureate Freeman Dyson, who thought for Princeton.

But their numbers have been growing in the last year. The American environmentalist, Michael Shellenberger, announced his de facto resignation as a leading environmentalist by writing his book,  Apocalypse Never. Its theme, echoing Lomborg's, is that climate change is a serious problem but not a looming catastrophe requiring drastic emergency measures.

Dieter Helm, the Oxford professor who was commissioned by the U.K. government to report on British energy supply chains and climate change, has now written a new book, Net Zero: How We Stop Causing Climate Change that challenges the central orthodoxies of the Western establishment’s climate policy. In a review on the U.K .Reaction website, Jack Dickens writes:

Two fatal flaws in the current global approach are emphasized in Helm’s book – the focus on reaching Net Zero carbon emissions while maintaining high levels of carbon consumption, mostly through off-shoring carbon-intensive activities, and the faith in a symbolic but ineffectual top-down approach to solving the climate conundrum, as exemplified by grand United Nations summits in Paris and Tokyo. The result, he argues, has been the creation of an illusion that something is being done while individuals and governments are consistently failing to take decisive measures.

And the U.K.’s main conservative papers in the Telegraph group—papers read by Tory activists and thus important to Tory politicians—have started to take a more skeptical view of Boris Johnson’s boasted “green industrial revolution” in op-eds by three of its star columnists—former editor Charles Moore, Sunday Telegraph editor Allister Heath, and columnist Matt Ridley. It doesn’t amount to a complete conversion; the Telegraph’s formidable financial columnist, Ambrose Evans-Pritchard, remains on Boris’s side. Still, all three have written strong criticisms of the government's net-zero policy recently, and Ridley offered an especially scathing critique of ten reasons why it’s a mistake.

Ridley, who moonlights as a member of the House of Lords, is the author of several well-regarded books on science of which the latest, How Innovation Works, is highly relevant to the climate debate. He takes aim at Boris’s ideas on  innovation in climate policy with a double-barreled shotgun. The first barrel demolishes the Prime Minister’s own proposed innovations:

Innovation will create marvelous, unexpected things in the next 10 years. But if you could summon up innovations to order in any sector you want, such as electric planes and cheap ways of making hydrogen, just by spending money, then the promises of my childhood would have come true: routine space travel, personal jetpacks and flying cars. Instead, we flew in 747s for more than 50 years.

The second barrel aims at Whitehall’s neglect of more realistic innovations that get no money or attention in the green industrial revolution:

My fear is that we will carry out Boris’s promised 10-point plan, cripple our economy, ruin our seascapes and landscapes, and then half way through the 2030s along will come cheap, small, safe fusion reactors.

It’s a bracing attack from a government supporter, friendly fire in fact, and taken together with the other skeptics, it’s a sign that the establishment consensus is showing some cracks. In part, these criticisms are a reaction to the fact that policies like net-zero carbon are ceasing to be distant possibilities and becoming real prospects. No sale of petrol-driven cars is only nine years away. And as Dr. Johnson wrote two centuries ago, when a man knows he will be hanged in the morning, it concentrates the mind wonderfully.

Mind, concentrated.

But surely these policies are popular with the voters? Wasn’t that the story of the U.S. opinion poll quoted above? How can a popular policy be reasonably compared to being hanged in the morning?

The answer to that objection is a rule that I’m thinking of calling O’Sullivan’s Second Law. It goes as follows: The popularity of a policy is less important than the popularity of its consequences.

How popular are the consequences of a policy of net-zero carbon by 2050 likely to be? It is hard to estimate that because governments constantly evade answering the prior question of what will be the costs of going net-zero in terms of higher taxes, higher energy prices, and a lower standard of living. They concede in a vague and slightly noble way that people will simply have to make heavy sacrifices, but they don’t want to put a figure on it.

That’s not surprising. When the New Zealand government did just that, it discovered, according to Lomborg, that getting to carbon neutrality would “cost more than NZ$85 billion annually, or 16% of projected GDP, by 2050. That is more than last year’s entire national budget for social security, welfare, health, education, police, courts, defense, environment, and every other part of government combined.”

Sixteen percent of projected GDP annually. That’s what you call political suicide. No policy that requires it will remain popular. It runs up against Stein’s Law formulated by the late Herb Stein, a distinguished American economist: ““If something cannot go on forever, it will stop.”

It can’t go on. Long before 2050, the net-zero policy will have to be abandoned. And the longer that political establishments cling to its defense, the worse the resulting crash will be.

A Test Drive for Net-Zero

Proposals for going green and hiking taxes—they seem to go together—rain down as gently upon us as leaves in Autumn. In Britain, as I mentioned last week, the Finance Minister, Rishi Sunak, is looking at new ideas to charge motorists for—wait for it—driving on the roads.

There will soon be s a $50 billion tax hole in his budget as a result of the government-mandated switch from gas-powered cars to electric ones by 2030. That date was moved forward from 2035 in a speech this week from Prime Minister Boris Johnson on his “green industrial revolution,” i.e., the U.K. equivalent of America’s Green New Deal that Joe Biden has been promising.

Boris’s speech unveiled a whole armory of exciting new green measures—summarized coolly in the London Sunday Telegraph by "lukewarmer" Matt Ridley as “all Britons driving electric cars powered by North Sea wind turbines and giving up their gas boilers to heat their homes with ground-source heat pumps. [Plus] He will invent zero-emission planes and ships.”

Are having fun yet?

Viscount Ridley suspects that not all the prime minister's hoped-for innovations will come to pass. As a strong believer in the importance of innovation himself -- his latest book is on that topic -- he thinks that we'll be happily surprised by some innovations by 2030, and we shouldn't take rash and expensive decisions that will foreclose those possibilities now. Equally, however, we shouldn't bet the bank on innovations that may never pan out despite our best efforts.

That's one cautionary truth. Another is that we can be pretty certain that these exciting new green measures Boris announced will likely bring forth a lot of exciting new green problems. Among them is that drivers won’t be paying the fuel taxes they pay now if they’re driving electric vehicles. That's why, to fill that budgetary hole, the finance minister is thinking to tax road use.

There must have been a hostile reaction to this leak because the next day the Times published a nervous follow-up:

Drivers would support a national road-charging system providing that it was not simply used as a “cash cow” by the Treasury, ministers have been told.

Of course, any new tax would be used by the Treasury as a “cash cow” if only because the U.K. is going to have to finance the economic effects of the lockdown one way or another. That’s a given. Also, governments like green taxes because they attract almost automatic support from green parties, pressure groups, and public opinion.

Road pricing has both green and attractive economic features as an alternative to other forms of taxation. As Dr. John Walker argues in his RAC Foundation study, On the Acceptability of Road Pricing:  It’s “technically successful; meets objectives ranging from managing congestion to raising revenue to fund road improvement; need not be prohibitively costly; and once in place, tends to gain public acceptance”

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As that guarded last comment suggests, however, it’s got some difficult features too. Switching from fuel taxes to road pricing is a problem in itself. Fuel taxes are simple to pay and to collect. Road pricing means that both government and the motorist have to install equipment to record the costs of journeys and to charge for them. It’s a more visible cost than when it’s paid as part of a price for petrol at the pump.

If the road pricing system is variable, moreover, imposing higher costs on cars sitting in traffic and lower ones on cars going along empty roads at off-peak periods, it will be more efficient, but it will also be more unpopular with the general public. Differential pricing of that kind makes economic sense because it discourages congestion and makes for more pleasant driving and less wasted time. But the public sees it as unfair because it penalizes those drivers who have to work regular hours and travel at peak hours, and they are often the poorer members of society.

And it’s being proposed at the wrong time. Motorists already feel under threat as many of the costs of Boris’s green industrial revolution end up being paid by them. If gas-fueled cars won’t be available from 2030 onwards, those owning such cars will find spare parts more expensive, gas stations fewer in number (and more distant), and gas prices higher. In the end they’ll have to purchase an electric vehicle if they want to continue driving.

Many of them—I’ve seen estimates as high as one-third of U.K. current drivers—will find buying an EV requires a serious financial sacrifice. Those who are unable to get a decent price for the resale of their petrol-driven cars will be in even worse financial straits. On top of these shock demands on their wallets, they will see the addition of road pricing as an intolerable extra.

It’s bound to provoke resentment among those financially hard-pressed drivers who find themselves paying heavy bills to use the roads that their taxes have already built in order to keep the economy moving today. That’s not entirely speculation. As the Times recalled late in the story: “The Labour government ditched similar plans for road charges 13 years ago after a petition attracted 1.8 million signatures.” Bringing in road pricing in such circumstances would risk a British version of the gilet jaunes suburban and provincial riots that have now lasted almost two years in France.

Coming soon to a country like yours.

Road pricing is not the villain in this mystery, however, though it may be the victim (murdered by numerous Acts of Government.)  The main super-villain, lurking in the background, is the decision taken with all-party support in Britain, echoed in similar decisions taken in Brussels and (shortly) in Washington, to aim for a net-zero carbon economy by 2050 which is both unachievable and certain to reduce living standards brutally. The lesser villain which is Son of the First is the decision taken by fiat of the present British government to switch to all-electric cars from 2030 onwards.

It is frivolity on stilts and bound to have terrible results: a hugely expensive electrification of Britain, power supplies nonetheless inadequate to cope with additional demand from EVs nationwide, electricity blackouts on a regular basis, increases in both taxes and electricity prices to pay for this transition, the spread of job losses in the industries that use power, etc., etc., in addition to the problems for motorists and taxpayers described above.

There is only one silver lining to this thunderstorm of clouds: when the policy of forced sales of EVs crashes into reality, it might compel the  Johnson government to reconsider not only that policy but also the larger futility of dragging down the U.K. economy and standard of living by depriving it of the cheap energy that most of the world will still be using.

Switching to EVs is a kind of test drive for the new kind of economic policy: not the betterment of the people but the moral preening of the elites. We'll see if the net-zero carbon economy has survived its first run round the track by, say, January the 1st 2031.