Ice on Fire

I encourage people to watch the excellent HBO documentary called “Ice on Fire” on concerns over climate change and remedial actions underway that should and can be leveraged. The documentary is produced and narrated by Leonardo DiCaprio, but the most impactful voices are the scientists, inventors and trendsetters who are seeing dividends from their actions and investments.

To sum up, we have two major problems facing us – too much carbon in the air along with a growing concern over methane as it is released from beneath melting ice caps and frozen tundra, on top of the venting from natural gas sites. The title comes from researchers lighting methane leaks on fire as it is released from melting ice covered waters. The scientists note with data that it is quite clear man is causing the hastened uptick in temperatures as we leave our carbon fingerprints in the atmosphere.

These are major concerns, but we are not sitting still. Significant efforts are underway. They can be categorized as putting less carbon in the air and capturing more carbon from the air. To avoid a novel, I will touch on some of the ideas, but please do deeper dives and watch the documentary airing now.

Stop putting carbon in the air

We must hasten the move to renewable energy. The costs are more on par and less, in some cases, than fossil fuel energy production. Wind and solar energy are growing at accelerated rates. One CEO noted, the technology is here to make this happen even more than it already is. Here in the US, California gets 25% of its electricity from solar and Texas gets 16% of its electricity from wind energy.

Yet, a very promising start-up off Scotland is tapping tidal energy. There is a company producing electricity today with an offshore platform with two turbines turned by the tides to generate electricity. I have written before about this group as they use existing technologies to harness the sea. Their success is gaining notoriety around the world, as it appears to be replicable.

Two other ideas also help with both recapture and restricting release. The first is reusing depleting biowaste (such as dying trees, plants and compost) in the soils to grow crops and future trees and foliage. The biowaste holds water better, maintains top soil and is straight out of nature’s guidebook.

The other is growing more kelp offshore as it captures carbon like sequoia trees and can also be used as a food source for livestock. Feeding cattle kelp is not a new approach. Feeding cattle is important as it greatly reduces the gases released by animals and preserves more carbon capturing grassland.

Capture more carbon from the air

The documentary spells out several natural ways to capture carbon and a few technological ways. On the former, here are a few ideas:

Maintain forests, especially those with large sequoias, which are huge carbon eaters. There are several places that are nurturing huge forests, but they note we need more of these efforts. We need to be mindful to replace what we cut, but keep some protected forests off limits to cutting.

Another example is to replenish mangroves that offer buffers to oceans. In addition to offering protection against storms, they also are natural born carbon eaters.

Another effort is to grow more urban farms. These farms are usually more organic, but in addition to absorbing carbon in urban areas, they perpetuate a farm to table concept that reduces transportation fumes. Reducing auto fumes is a huge concern of cities around the globe.

The next idea is more compex, but it requires the growing of more shells in the ocean. The dusts off the shells creates “ocean snow” that settles to the bottom and absorbs carbon. The idea is to spread a very small amount of iron in the ocean to cause more shells to grow.

The more technological solutions are designed to pull carbon out of the air. There are two approaches – one is to extract carbon and store it safely underground. The other is to pull it out and reuse it through artificial photosynthesis. Both of these options need more description than I am giving them. I prefer the more natural ways, but all of the above, is a necessary strategy at this late hour.

The scientists have concerns, but they do offer hope. The uncertainty of the ice-covered methane release gives them pause. They did note the methane release from accidental leaks from fossil fuel is visible from space and reduceable with some effort.

Another concern is the well-funded activity behind climate change deniers. A Wyoming rancher scientist standing in front of a visible, leaky methane cap said it plainly – they know this stuffs hurts kids more than adults. If someone came into my home to hurt my kids, it would be over my dead body. So, why is it OK too allow this?

Another scientist was less colorful, but equally plainspoken. He said fossil fuel executives perpetuating climate change denial should be tried in The Hague for crimes against humanity. Yet, as the costs have declined, the profit of creating carbon is becoming less palatable than the profit of reducing carbon in the air. People need to know these market forces exist today and not stand for future unhealthy energy creation.

Finally, if you cannot convince a climate change denier that we have a problem, ask them a simple question – if costs were not an issue, would you rather your children and grandchildren breathe methane from vented natural gas or drink coal ash polluted water or have carbon and methane neutral solar, wind or tidal energy? Guess what – costs are not much of an issue anymore and, in an increasing number of cases, less for renewables.

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Boom, boom, boom, boom – the US deficit and debt continue to explode

In honor of John Lee Hooker’s famous lyric, which is played at the beginning of “NCIS – New Orleans” and in the movie “Blues Brothers,” a good wake-up call for our US deficit and debt is “boom, boom, boom, boom.” Please note, this is not the trade deficit, which is overblown as a problem as we are more of a consumer nation. This is due to our government spending far more than they take in revenue.

Per the following introduction in a Bloomberg News article, “U.S. Budget Gap Balloons to $739 Billion Despite Tariff Revenue,” we have an escalating problem.

“The U.S. budget deficit widened to $738.6 billion in the first eight months of the fiscal year, a $206 billion increase from a year earlier, despite a revenue boost from President Donald Trump’s tariffs on imported merchandise.

The shortfall was 38.8% more than the same period a year ago, the Treasury Department said in its monthly budget review released on Wednesday. So far in the fiscal year that began Oct. 1, a revenue increase of 2.3% hasn’t kept pace with a 9.3% rise in spending.”

Right now, our US debt tallies more than $22 trillion and was expected to increase by $10 trillion over the next ten years, before the tax cuts in December, 2017. Our fiscal year runs October through September, so this is the first fiscal year with full benefit of the tax cuts. The Congressional Budget Office forewarned the tax cuts would increase the debt by $1.5 trillion over the next ten years over the already projected $10 trillion. That will put us closer to $34 trillion at that time.

Yet, Americans were told by the president and favorable politicians that the CBO was wrong and growth would accelerate enough to pay for the debt using the assertion “the tax cuts will pay for themselves.” Per the Committee for a Responsible Federal Budget, tax cuts do not pay for themselves, with the best historical result being in the neighborhood of 30%, but usually much less. That leaves 70% of the revenue reduction adding to the deficit in the best of times.

The reasons for the increase in deficit are increases in military, healthcare and interest cost spending, which have overshadowed the revenue increases due to the longest running economic growth period in the US. Even the worst budgeter amongst us knows, we should be paying down debt when times are good, not increasing it. Sadly, the economy has begun to slow some, so the tax cutter’s rosy projections of 4% and above growth have not materialized (except in an isloated quarter) and economists are expected  lower growth rates than the current 3% per annum the rest of the year.

Per The Concord Coalition, the above Committee for a Responsible Federal Budget and the Simpson-Bowles Deficit Reduction plan from December, 2010, we must solve our deficit and debt problem through spending cuts and revenue increases (tax increases) both. The math will not otherwise work. If any politician, no matter how smugly, tells you otherwise, they are not be honest with you or are misinformed themselves.

To be brutally frank, I said so then, but the tax cuts passed in December, 2017 were malfeasance in my mind. We borrowed from our future to make a pretty good economy a little better. It was also hypocritical. Former Freedom Caucus members got elected saying the previous $5 trillion, then $8 trillion, then $13 trillion debts were abhorrent. Now, when it is just below $22 trillion, they pass a bill that increases it even more.

When I raised this with a Freedom Caucus staff member, he curtly told me the CBO is often wrong and they are wrong on this. My push back was simple. These folks do their homework to try and get it right. And, what I have found in my 40 years of adult life, is politicians hail the CBO when their number agree with their decision and call them on the carpet, when they don’t. Yes, it is a projection, but these folks try to be apolitical.

Folks, we have a problem that is not getting talked about enough. We must cut spending and raise revenue. My GOP friends have ceded their fiscal stewardship mantra – that is highly unfortunate. My Democrat friends need to question every candidate on how they plan to pay for their ideas and what they plan to do about the debt. We cannot have Medicare for all if we cannot pay for it.

So, let’s get real and ask politicians some pointed questions. If we don’t, John Lee Hooker will sing even more loudly. “Boom, boom, boom, boom.”

 

Coal can’t be made great again says conservative economist

Walter Block is a professor of economics at Loyola University in New Orleans and a Libertarian. He recently penned an op-ed piece in The New York Times called “Coal can’t be made great again.”

Block sets the context for free-market thinking using more basic purchases – shoes, clothes, restaurant meals. This “leave it to the market forces” is a mantra for free-market Republicans. Yet, as Block notes “One would think that Republicans would apply that same logic to our fuel industry.”

He adds while government has a “legitimate role” in ensuring the safety of nuclear and other plants, “it should not favor, or oppose, nuclear power, gas, oil, coal, wind, water, solar, or any other source of energy over any other.”

He also notes a couple of observations of data points which reveal “the market is moving away from coal.” First, he writes “In 2016, American reliance on coal had dipped to 30% of total electric energiy expenditure, from about 50% in 2000. In contrast, natural gas and even wind, solar and water power are becoming less expensive, and will likely take on a greater share of the overall energy industry.”

Second, he notes “For the first time, as predicted by the Institute for Energy Economics and Financial Analytsis, in April, renewables generated more electricity than power plants fueled by what was once called ‘King Coal.'”

It is through these lenses, he views the efforts to subsidize coal use and place tariffs on imported solar panels as a political attempt to “pick winners.” We should not be “propping up coal” at the expense of alternative energy sources.

In my view, we are passed the tipping point on coal. New plants are too costly to build and the present value cost of acquiring, transporting, burning, storing the ash, health and environmental degradation and litigation of coal exceeds other sources. Further, the solar energy jobs are 4x the number of coal jobs. And, wind energy is soaring in growth, especially through the plains states.

This is not a US-centric result. Renewables are growing rapidly abroad with Germany now getting more energy from renewables than coal. China has been heavily investing in solar panels. But, my favorite global example is southern Australia is now solar powered using American Elon Musk’s battery storage and a French company’s installation of solar panels. Three continents came together to forge a renewable future.

While I agree with Block for the most part, government can play a role to help move forward cleaner energy initiatives, at least temporarily. So, the temporary 30% tax credit for solar power installation makes sense, especially when our Department of Defense continues to cite climate change as a significant threat to national security, even under the current president.

But, as the renewable costs have become more on par from a production standpoint, they can stand on their own without the tax subsidy. Embracing future technologies that will drive the economy is essential. As an example, yesterday, Toyota announced the movement from 2030 forward to 2025 when 1/2 of their vehicle sales will be electric cars, with batteries being made in China. So, if our leaders look backwards too much, we might get passed by.

 

 

 

 

The strangest thing

Listening to an interview with New York Times reporter David Enrich on NPR the other night, I heard a story that boggles my mind. When Donald Trump declared bankruptcy on six different enterprises, US based banks stopped lending him money. So, he went to German based Deutsche Bank for business loans.

Even there, Deutsche Bank’s investment bank soured on Trump and refused to lend him any more money. Then, its real estate mortgage bank soured on him and was owed US $50 million after refusing to lend him more. But, after bank leadership mandated no more lending to Trump, the story became even more bizarre.

Trump’s son-in-law, Jared Kushner, introduced him to a private wealth manager in New York for….Deutsche Bank. She arranged a $50 million dollar loan from Deutsche Bank’s private wealth group to pay back the outstanding loan with the real estate mortgage bank group within Deutsche Bank. Robbing Peter to pay Paul does not adequately define what happened. And, this is after Deutsche Bank leadership mandating no future loans with Trump. Enrich was unsure if this loan was still outstanding.

Having worked for a very conservative bank in my past, this is a quite surprising story. As a retired consultant, I am aware of one bank that had to be sold due to one very big loan defaulted. I am also aware of several banks who overextended themselves during the housing crisis that no longer exist. But, for Deutsche Bank to permit one part of the bank to pay off a loan from another part for a persona non grata individual, is quite strange and not in keeping with good stewardship.

It should be noted Deutsche Bank has been investigated and fined for money laundering for members of Russian oligarchy. It is also why there is interest in Trump’s financial dealings with this bank by the US Congress. Enrich noted Deutsche Bank is the “Rosetta Stone” to digging into Trump’s finances. This is why Trump has threatened to sue the bank to prevent such release.

Citing climate differences, Shell walks away from U.S. refining lobby

Last month. Reuters wrote an article entitled “Citing climate differences, Shell walks away from US refining lobby.” Here are the lead paragraphs.

“Royal Dutch Shell Plc on Tuesday became the first major oil and gas company to announce plans to leave a leading U.S. refining lobby due to disagreement on climate policies.

The review is part of Shell’s drive to increase transparency and show investors it is in line with the 2015 Paris climate agreement’s goals to limit global warming by reducing carbon emissions to a net zero by the end of the century.

It is also the latest sign of how investor pressure on oil companies, particularly in Europe, is leading to changes in their behavior around climate. Last year, Shell caved in to investor pressure over climate change, setting out plans to introduce industry-leading carbon emissions targets linked to executive pay.”

Shell is not the first oil company to cave to investor pressure. Exxon Mobil and Occidental Petroleum (along with utility PP&L) have to inform shareholders of their progress to addressing climate change after shareholder votes required them to do so. Exxon also has two lawsuits it is dealing with accusing them of misleading investors on the financial impact of climate change.

Climate change is real and is impacting us now. The greater number of sunny days coastal flooding, increased number of droughts, increased and more severe forest fires and the added flooding due to slow moving storns are traceable to the impact of climate change, so says climate scientists. I encourage you to ask politicians what they propose to do about this existential threat to our future. If they do not respond or fail to offer any tangible ideas, do not vote for them. We must move forward as we have squandered much of our window to act.

 

On the downhill side of hump day

Tomorrow, the infamous Mueller report will be released in redacted form. Of course, the AG has called a press conference, so there are no guarantees. I would not be surprised by anything at this point. I do see a scared President.

What I find interesting is Giuliani and crowd are preparing a rebuttal, yet we have been told they had not see the report. I did not believe this for one bit, but I find it odd that you can write a rebuttal to a report you have not seen.

What I also find interesting is how someone can tout the summary conclusions that the AG offered and then denigrate the underlying report. This was akin to Trump saying Michael Cohen lied to Congress, except when he was bragging on Trump.

Herman Cain said he will keep his hat in the race for the Federal Reserve Board. This is giving the GOP Senate leaders heartburn as they see him as unqualified and unfit based on past issues. They have a right to be concerned, in my opinion.

Mayor Pete has some sound advice for his fellow Democrat Presidential candidates – do not make this about Trump bashing. I agree. Mayor Pete has impressed every where he has gone for interviews.

Speaking of impressing, Bernie impressed the Town Hall attendees on Fox. Dems need to do more of this, as their message is overall better than the current President and GOP. It is not perfect and needs to move to the center more, but talking about healthcare, job training, climate change, e.g. is much better than a border wall. By the way, the President, who feels Fox is his network, has fumed twice for Fox hosting Bernie. I find this amusing.

Finally, I was quite tickled when the President started criticizing Bernie’s taxes that he released. The response should be simple – “Mr. President, you are welcome to do this as I realized my tax returns. Where are yours? What are you hiding?”

Some Wednesday Why Questions

Several news stories have crystallized over the past few days forcing me to ask some why questions. Here are just a few on this Wednesday.

Why is the party that is adamant voter fraud is more prevalent the one who causes more of it? Today, the GOP North Carolina chair was indicted for bribing a public official with campaign donations. This is on the heels of the GOP Congressional candidate absentee ballot fraud issue and the unconstitutional gerrymandering that has gone on under GOP tutelage in NC.

Why are we playing politics with the President overriding an unheard of 25 security clearances, including two relatives? I don’t care what party is responsible, this should give all Americans pause, especially given the President’s poor attention to vetting, conflicts of interest and the fact his two relatives do not hold positions that were approved by the Senate. The CIA has been concerned about Jared Kushner’s culpability for some time, eg.

Why is the British parliament failing to read the tea leaves on Brexit? There is a petition with 6 million names asking for a cancellation of Brexit. When the petition was criticized for foreign involvement, it was determined that 96% of the names are UK citizens. I read today that Ford will re-evaluate what to do with two British car plants depending on what happens. They are not alone.

Why is Shell Oil pulling out of an US based petroleum industry lobby group beginning next year? Its shareholders are forcing the company to more demonstratively  address climate change and support the Paris Climate Change Accord. It should be noted Exxon Mobil shareholders asked the company to report back on what they are doing about climate change. Both companies were active on climate change research before they decided to pretend it was not a problem in public.

Why would the President even consider closing the border with our third largest trading partner, not to mention the people who live in Mexico and work in the US? This would be harmful to the US economy, per Senate leader Mitch McConnell (and many others) and even more so for border states. It also overlooks the greatest need to help with the chronic border problem – immigration judges. Walls and closures are just costly theatrics.

Why is it OK to want to trade with North Korea, but not Cuba? The real reason is Obama opened the doors to the relationship. For some reason, Trump has an unhealthy focus on things Obama did. But, trading with Cuba is desirous to many Americans and Cubans and is far easier to get a return on investment. Commerce is a good way to break down barriers.

That is all for now. Let me know what you think or if you have any more why questions.