September 26, 2005 6:49am by David Farrar

Blair on Kyoto

Owen McShane kindly sent a transcript of Tony Blair on Kyoto. He effectively says that Kyoto is dead and no country will honour it. That is except New Zealand!!

MR. BLAIR: I think that

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Comments (67)

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Gooner

Two good letters to the editor in this morning’s Herald asking what is causing Mars to warm up if there are not cars, industries etc emitting greenhouse gases. Must be ‘Universe ad in finitem Warming’ rather than global warming, aye?

Kyoto is a con. Wake up to it people.

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September 26, 2005 8:20am

Zippy Gonzales

From New Scientist 3 September:
“I don’t often agree with George Bush, but in this case he is right. Climate change will be combated by new technology, not by changing hearts and minds.”
– Ian Fells, chairman of the New and Renewable Energy Centre, Northumberland, UK.

We need more scientists and R&D, not more lawyers and accountants.

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September 26, 2005 8:22am

Logix

Whatever the pros and cons of Kyoto are, the true merit of that agreement is that it represented the first global collective effort to address the potential risks of human activity on the climate.

Let me put it this way. Let’s imagine that future in which all this lovely “new technology” that you have proposed has come to pass. Yet one nation, exploiting a competitive advantage, eschews the use of the new technology and continues to pollute unabated. mmm…problem. On a smaller scale we only saw the universal introduction of catalytic convertors on cars, as a result of legislation, as individual manufacturers had no effective incentive to act.

The fact is that some problems demand collective responses. A new technology that benefits individuals, eg cellphones, will be adopted by individual actions. This is what the market is good at. By contrast, technologies that benefit the wider public good, eg catalytic convertors, demand legislation, or market manipulations (like Kyoto) in order to be adopted.

Kyoto represented a first, and widely acknowledged as flawed, first attempt to address a very real risk. We are free to attempt another solution if new science or new technologies make this possible. But if you toss out the principle of collective action, your vaunted “new technologies” will never be implemented.

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September 26, 2005 9:03am

Ed Snack

Logix, you have it almost exactly backawards. It is only if we DO toss out the collective action foolishness that we can expect the new technologies to be implemented. The collective action meme is almost certain to force the implementation of purely political solutions, like Kyoto, with political not scientific ends in sight.

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September 26, 2005 9:23am

Logix

Eddy,

Can you think of no collective action that you life and welfare depend on?

From the Blair quote at the start:

> The truth is no country is going to cut its growth or consumption substantially in the light of a long-term environmental problem.

In other words Blair is saying that it is every nation for itself…and stuff the consequences.

Now if I was to arrive at your house, with a bunch of mates, and uplift whatever property I took a fancy to, and left excrement smeared everywhere, I hazard a guess you would be pissed. Now assuming my bunch of thugs are more numerous and better armed than your cuzzies, what recourse do you have?

I guess you might fancy calling the cops and explain to them that there are laws against what I have just done. ooops… no that is just “collective action foolishness”.

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September 26, 2005 9:41am

gd

Kyoto is all about TAX Socialist govenments need to dream up new ways to extract money from its workers to fund their ever increasing nanny state activities. What better than to label something harmful and then put a tax on it Anyone who dares to try and debate the matter is labelled selfish ignorant etc etc.It shuts down opposition.
This is one of the greates con jobs of all times

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September 26, 2005 10:58am

Simon

Zippy was right there are too many lawyers and accountants but have you ever met a poor lawyer or accountant? With big government lawyers and accountants flourish something like mushrooms and shit.

Technology requires human resource as identified by Zippy and if Blair were serious about technology he would halve the size of his government. Logix is right though some technology needs oversight but the oversight needs to be driven by the democratic process. Globally at the moment we have an anti American minority hijacking the agenda aided and abetted by big government bureaucrats full of their own self-importance. However NZ just voted and Labor got in thus we go ahead with Koyto for what will be an interesting learning experience.

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September 26, 2005 11:29am

James

To clafify….its collectivist action that is the problem rather than collective action.The former rides roughshod over the individual rights of people by imposing a one size fits all tribal solution to a problem(and thats debatable)while the latter can be consistent with respect for individual rights if everyone involved chooses to participate…

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September 26, 2005 12:20pm

mara

Kyoto is dead.It just needs to have its eyes closed and a label tied to its toe.

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September 26, 2005 3:24pm

Paul W

gd/mara: Kyoto is about making development more sustainable, creating a market is just a mechanism (the two major instruments are funds/markets; clean development and joint initiatives – not taxes).

You’re comments ill-informed.

What Blair said is not the end of Kyoto or, more importantly, of carbon trading – he has merely restated the thesis Brundtland (1987). Brundtland called for an 5 – 10 fold INCREASE in production to ensure that poorer nations were not excluded from benefits of economic development but it also proposed limits to resource use.

Importantly, while pinning hopes to continuing and high growth rates, the report also sought commitments on social justice and inclusiveness to fight poverty and inequality. It relied on TECHNOLOGICAL DEVELOPMENT and INNOVATION to resolve the dilemma posed by the finite capacity of the global ecology to support unrestrained and environmentally damaging growth.

This is the basis for Kyoto!

If you actually took the time to read and think about what you’ve heard, you’d be in a better position to make useful comments rather than being so easily dismissed as uniformed (I’m not labelling you ignorant, you clearly are ignorant).

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September 26, 2005 6:23pm

Ms Marple

James, give the trite ideological semantics a rest. Whatever you think of subscribing to Kyoto, the realities are that the problems with it are based on the fact that it is basically impossible to get everyone to participate in global agendas. And that’s not even a perspective that needs a US = bad UN = good or vice-versa world view. Nations see threats to their interests in all sorts of international agreements.

Sometimes it’s regimes broadly viewed as psychopathic like North Korea with their shunning of myriad conventions on human rights. Sometimes it’s regimes broadly viewed in a positive light, like New Zealand and the Convention on Child Soldiers, that would be problematic for our policy of allowing 16 year olds to join the army. Sometimes it’s regimes on which consensus is pretty much impossible to achieve, like the US and all manner of conventions they demand others subscribe to. And in every instance that regime will present a detailed argument regarding their reasons for not signing up. Those arguments are usually full of valid traction for both sides of the debate (and sometimes they come from North Korea).

Now to clafify[sic]… Kyoto is riddled with holes because of a range of individual interests. The third world argued that the several centuries head start the West had in social and industrial development, meant it was unfair to cripple poor developing nations with the same modernising/economising obligations as the much wealthier developed world. Consequently, when considerations of these complaints were built into the agreement the US collected a coalition of nations who ostensibly objected to the competitive advantage these considerations afforded the third world. Now the rights and wrongs of these positions and the various scientific and economic fud thrown around by all camps is a vast debate for somewhere else.

However, the self-interest that undermined Kyoto (at every level) is not going too be any less evident in any alternate agreement on the issue. The reality is that economic interests are fundamentally associated emerging environmental necessities. It is absolute crap to suggest that some global treaty with “respect for individual rights” where the nations of the world, rich and poor, choose to participate is going to result in anything other than no agreement at all.

You are opposed to the one size fits all tribal solution? Kyoto had to be, but was anything but. The problems Kyoto seeks to address are not problems that some nations can do their best on while others drag their feet and accept all the consequences. This is not like human rights or jurisprudence or even economic freedom. Kyoto seeks to address a global problem that fundamentally affects everyone. But then the biggest problem in terms of the arguments that Kyoto has become tied up on, was the fact that Kyoto couldn’t be a one size fits all agreement or the third world would have walked away from the broader agreement (they weren’t exempt, they were exempt for a time). But then that differentiation was a problem for both industry and primary producers in the US. Which is why they walked.

So I guess what I’m saying James is that your reduction of the problems with Kyoto to a facile individual rights analysis is just crap. And it is crap whatever you believe of the science or the politics. For the record, I’m pretty comfortable with the evidence pointing to the fact we’re all screwed (you’ll note that the majority of US administration science has switched from denying global warming to speculating on alternate or parallel causes of global warming – not very comforting given the end result is the same). And I’m in favour of New Zealand supporting the Kyoto protocol, for any number of reasons, including confidence in our economy to adapt to it and an unabashed idealism towards New Zealand’s ability to forge the righteous path (and similar crap like that).

But before I get away on myself, James, your argument: bollocks.

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September 26, 2005 6:40pm

mara

I guess it all comes down to one’s own judgement.Like you I have access to commentary world wide;we both examine the slime under the rock and the sunshine over it.That we come to different conclusions is no suprise.I could bore you with the reasons for my conclusion that Kyoto is dead.Nada.There is no point.You will believe what you want to.Christ! you may even be right.

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September 26, 2005 8:54pm

mara

I take back the comment Christ,you may even be right. Nah,Kyoto is dead.

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September 26, 2005 9:02pm

B.J. Melville

Kyoto is dead, it was just another Euroscam and people saw through it. Blair must have made more effective arrangements for Britain’s future energy needs to have ditched it so early. The German election might have had something to do with it too.

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September 26, 2005 9:34pm

Logix

Thats ok guys…if Kyoto is dead, and it turns out you are wrong about CO2 and climate warming, and we never do anything about it because all colelctive action is a “euroscam”…then we are all dead anyhow.

But of course you are right…aren’t you?

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September 26, 2005 9:53pm

B.J. Melville

Who said anything about dying? Been fiddling with your climate models again Logix?

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September 26, 2005 10:31pm

gazzadelsud

hey Logix, so how does that 0.5 degree change, maybe in 100 years suddenly mean we all are dead?

look you may want to be a believer, but sometimes when you look around and discover that its really very very lonely, it could be that everyone else is right and you got it wrong.

kyoto is dead because with 1 (thats right count it up) silly naive exception, all those goody two shoes countries that signed up, have decided to cheat.

regardless of your views on the pros and cons of global warming, it appears that only 1 country is prepared to sacrifice growth for the “collective” and that country’s example will have a negligible impact.

This means – and I think this is what Blair was saying, is that the Kyoto system cannot work, so it is time to go the technology route, because no country can afford to sacrifice economic growth for an abstract and far off outcome.

You might think that is sad/tragic/whatever. It appears to be an outbreak of realism to me.

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September 26, 2005 10:56pm

Logix

At last a real climate change expert who can reassure us that the maximum impact will only be 0.5degC !!! Thanks gazza, I’ll sleep so much better knowing this for sure now. And gee I’m so cross at all those naughty scientist types who have been scaring me with silly stories.

Actually there is one little thing that still puzzles me. Why did all you right wing “free market” types so deeply hate Kyoto (which was merely an attempt to use a market mechanism to modify behaviour), and at the same time embrace “new technologies” (which don’t exist yet) that will only be implemented if nasty stalinist governments legislate it into place?

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September 26, 2005 11:32pm

Simon

Logix do you know much about this fella? http://en.wikipedia.org/wiki/Andrei_Illarionov
He doesn

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September 26, 2005 11:48pm

Simon

Logix do you know much about this fella? http://en.wikipedia.org/wiki/Andrei_Illarionov
He doesn

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September 26, 2005 11:51pm

Kimble

Perhaps you meant, “deeply hate Kyoto (which was merely an attempt to use an unenforceable and perfectly voluntary market mechanism to hobble rich nations and bring down capitalism once and for all!)”.

Do you think that perhaps we did not like Kyoto because we thought it wouldnt do what it was touted to do, that its benefit would be greatly outweighed the cost and that noone would really keep to it?

Lets tally up shall we? One to us… make that two….and..well..three really. Were we right? Jesus frozen-tampon christ on a fucking stick!

The only Kyoto supporters left seem to be the loons that considered ANY agreement, no matter how flawed, unworkable and unrealistic, was progress and the unreformed anti-capitalists who thought Kyoto would be a way to kill the great beast from within.

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September 27, 2005 12:02am

gazzadelsud

uh, logix, i guess that was your idea of sarcasm?

you know sometimes its a bit hard to tell with you.

on the basis you might actually know what you are talking about – Which model prediction are you quoting from then? or is yours just the chicken licken model of global warming?

I don’t purport to be a climate scientist, i do back myself as a political economist tho. To date my predictions are looking pretty good – how are yours coming along?

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September 27, 2005 12:33am

B.J. Melville

Like I always said, the Japs and Europeans always had an incentive to foist Kyoto on the rest of the world as they have already used up their economic coal reserves. Maybe Blair has secured a cheap alternative?

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September 27, 2005 12:45am

Logix

A key aspect of the the global climate is the remarkable stability of mean temperatures over periods of thousands of years. This stability is reflected in all the models by control loops. As an engineer who implements control loops on a daily basis, this aspect is especially compelling to me. The effect of a control loop, (or negative feedback) is to maintain a controlled variable (in this case temperature) stable against variations in a process (in this case external solar irradiation and internal changes such as the Great Ocean Conveyor current).

Most of the loops I deal with are very simple to analyse and predictable to work with. For example, opening a valve will increase the flow of steam into a heating vessel and will normally increase it’s temperature in a predictable manner. In some cases however the material being heated exhibits an exothermic characteristic, and the temperature rise will be much harder to predict. The three big challenges to stable control are multiple variable interactions, non-linear responses, and time delays. In an industrial process we usually design the system to manage these three challenges. By contrast in the physical world, the nature of the processes that we are participating in are both complex and non-linear. And in many cases we are aware that our modelling is incomplete.

All attempts to analyse the global climate grapple with these challenges. One of the most alarming aspect is that mathematically we know that this class of process with these kinds of characteristics are prone to chaotic behaviour at the limits. The concept of “control limits” is crucial to this discussion. Going back to my simple steam heating loop. Normally if the temperature in the vessel is getting hotter than I want, all I have to do is close the steam valve somewhat and eventually the vessel will cool as desired. But if the process is behaving exothermically (ie it is generating it’s own internal heat from a chemical reaction) then I will need to close the steam valve a lot more to stabilise the temperature. In fact it is quite possible that even fully closing the steam valve may not stabilise the temperature of the vessel. In other words I have reached the limit of my control action, and I have lost control of the process. (At the Motonui Methanol plant this point would be closely followed by a large explosion.)

Of course this is only an example. The key point to take away, is that control loops always have limits, and that when those limits are reached, the loop ceases to control. In terms of the global climate, it is entirely reasonable to assume that human greenhouse gas emissions are curently being “controlled” by a complex of feedback mechanisms. For this reason the observed temperature rise in the face of these emissions may well be small, UNTIL one or more of these loops reaches a limit.

Here is the problem though. In the case of my steam valve I can quite readily predict when the limits will occur, they will happen when it is fully closed or fully open, or I run out of steam. In the case of the global climate, we not only know far too little about the nature of the total system, but we know even less about it’s control limits, and almost nothing about the likely behaviour at those limits. In fact the kind of linear loop analysis I am familiar with is totally inadequate to address this kind of problem…it is the specialty of mathematicians and numerical analysis experts who derive powerful and complex models using statistical methods to attempt these predictions. But however well evolved these models become, it is almost axiomatic however that chaotic and non-linear behaviour is an extremely likely consequence of unconstrained and rapid changes of the kind the human race has been indulging in over the last 50 short years.

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September 27, 2005 1:41am

gazzadelsud

ok, well argued, but thats not the point of contention. Sorry. This is not an argument about whether the climate is in fact changing, or whether something needs to be done.

The point of contention is that no matter what your view on climate change, Kyoto was objectively the wrong answer. It has been gamed and in any case its impact even if implemented would have been largely irrelevant (this is where the 0.5 degree came from incidentally, i had my reference wrong, it was the predicted difference Kyoto MIGHT make if noone cheated).

The question then becomes, what next. The US has suggested the solution will be technology and market driven, and they are making some (pretty soft) undertakings about technology transfer.

This seems (to me) intuititively more sensible than the “global community” world socialism model, that required everyone to forego national self interest – a feat unique in human history.

As to your closed vessel, well given we dont understand the system, don’t understand the feedback loops, don’t understand how closed it is, don’t understand the relationship between our planet’s temperature and the sun etc etc, don’t you think its just a little presumptuous to declare that man made climate change is a catastrophic problem. As an engineer I very much doubt you would dream of accepting a client specification based on such weak hypotheses?

As for me I am still waiting for the climate cooling that I was being warned about in the 70’s but thats after the earth’s population collapses after we run out of food, so i guess I’ll miss that too.

Life’s too short to inflict the hobbies of the apocalyptic on others.

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September 27, 2005 3:01am

Paul W

Leave the science out of the equation if you want, there will be global system for allocating a price on carbon. It is inevitable and is already influencing global business – as I’ve said previously, many OEMs have significantly re-engineered their production systems to reduce their carbon footprint (Ford and Ikea are good examples that you can have a look at online). There is an increasing alignment of shareholder value with sustainability and carbon is a critical indicator (hence the reference to Brundtland in an earlier post).

If not Kyoto, son-of-Kyoto will be in place, forget all the ridiculous and rhetorical arguments about politics, because of the economics of it. Global companies are increasingly setting policy to ensure there’s a level playing field and instituting a price on carbon and a market for emmissions is fundamental.

To say Kyoto is dead on the basis of Blair’s comments last week is both a misunderstanding of Kyoto and gross overstatement. He hasn’t said anything that is unusal (though most would be surprised that he’s said what he has) and you’ve got to remember that EU has implemented the largest carbon trading system in the world, Europa.

Mara: I’d say you’re overstretching, being too absolute when you can’t adduce evidence to support your claim. But I could be wrong, you could be holding back – somehow I doubt it.

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September 27, 2005 9:31am

B.J. Melville

Paul W, really, the point of what Blair was saying is that all this stuff industry has been doing is a just a big enviro-PR excercise and won’t do a thing to stop global warming, if in fact it will happen.

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September 27, 2005 9:46am

Logix

Gazza,

First up I think few people thought Kyoto was a sufficient solution; and secondly it was formulated over 10 years ago and human knowledge on the issue has progressed since; criticising it and declaring it “dead” is a pretty soft position to take.

If I understand you correctly you are saying that you have greater faith in the “market” to solve the problem than any form of global governance. I agree, and yet this is to my mind the pivotal point of the problem. I would that the market is excellent at delivering technologies and solutions that individuals benefit from. This is how the market works. But I don’t have to look far to see how the “market” is far weaker at delivering solutions that benefit the “public good”, and these are usually delivered to a greater or lesser extent by government action. Some nations like Sweden use this principle to a high degree, others like the USA prefer to use it less, but there is no modern functioning nation that fails to use it at all. The “market” is also excellent at providing for the short-term, it usually fails spectacularly at taking into account long-term concerns, because commercially most people acting in a market require safe returns and the longer the time horizon the more uncertain the result. It is for this reason that for example, in most countries, individuals buy cars, but governments build roads.

I am not knocking the ability of the market to deliver remarkable results, but in the case of global climate change I think it is the wrong tool.

> that required everyone to forego national self interest – a feat unique in human history.

Agreed, this is the pivotal point. Over the last 150 years we have indeed reached a unique point in human history, successive waves of nation and empire building have culminated in the almost unprecedented globalisation of the human race. The process has been of course non-linear, a similar high water mark of globalisation occurred in the years just prior to WW1, and the utter failure of world leaders to transcend national self-interest at that time resulted in two World Wars, the catastrophies of the Stalinist and Maoist holocausts, and the on-going poverty death-trap so many Third World countries are locked into.

But I contend that we have reached the limits of national sovereignty and national self-interest. Is it too hard to understand that long term global issues that impact the entire human race, may well demand global solutions in exactly the same manner that we implement them on a national scale? As an individual you do not abdicate your entire personal self-interest because you are a citizen of NZ and indeed you gain significant benefits by submitting part of your personal freedom to the wider interests of community. Exactly the same model applies to nations participating in a global federal governance.

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September 27, 2005 11:05am

Logix

(Sorry I’m going to repost this as I made a dreadful grammatical error in the previous one…grr)

Gazza,

First up I think few people thought Kyoto was a sufficient solution; and secondly it was formulated over 10 years ago and human knowledge on the issue has progressed since; criticising it and declaring it “dead” is a pretty soft position to take.

If I understand you correctly you are saying that you have greater faith in the “market” to solve the problem than any form of global governance. I would agree that the market is excellent at delivering technologies and solutions that individuals benefit from. This is how the market works. But I don’t have to look far to see how the “market” is far weaker at delivering solutions that benefit the “public good”, and these are usually delivered to a greater or lesser extent by government action. Some nations like Sweden use this principle to a high degree, others like the USA prefer to use it less, but there is no modern functioning nation that fails to use it at all. The “market” is also excellent at providing for the short-term, it usually fails spectacularly at taking into account long-term concerns, because commercially most people acting in a market require safe returns and the longer the time horizon the more uncertain the result. It is for this reason that for example, in most countries, individuals buy cars, but governments build roads.

I am not knocking the ability of the market to deliver remarkable results, but in the case of global climate change I think it is the wrong tool.

> that required everyone to forego national self interest – a feat unique in human history.

Agreed, this is the pivotal point. Over the last 150 years we have indeed reached a unique point in human history, successive waves of nation and empire building have culminated in the almost unprecedented globalisation of the human race. The process has been of course non-linear, a similar high water mark of globalisation occurred in the years just prior to WW1, and the utter failure of world leaders to transcend national self-interest at that time resulted in two World Wars, the catastrophies of the Stalinist and Maoist holocausts, and the on-going poverty death-trap so many Third World countries are locked into.

But I contend that we have reached the limits of national sovereignty and national self-interest. Is it too hard to understand that long term global issues that impact the entire human race, may well demand global solutions in exactly the same manner that we implement them on a national scale? As an individual you do not abdicate your entire personal self-interest because you are a citizen of NZ and indeed you gain significant benefits by submitting part of your personal freedom to the wider interests of community. Exactly the same model applies to nations participating in a global federal governance.

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September 27, 2005 11:12am

Kimble

I cant think of anything less appealing than a world government. My government is there to represent me, it is a way that I can amplify my control the world around me. THIS is the sole reason for governments in the first place. They are not an authority unto themselves, or at least they arent supposed to be, and they dont exist naturally. The larger the government, the further away it is from the individual and the less accountable.

People who are for a world government usually have some particular purpose in mind be it prevention of global warming, the imposition of a religion etc. What all these things have in common is a desire to change the behaviour of others, to MAKE them conform to what the advocate wants.

A world government by definition is the largest government possible. It is as far from the individual you can get, to the extent that it cannot even be considered democratic. The individual has less control over their world than they would without the world government.

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September 27, 2005 12:02pm

Paul W

BJM: I completely disagree, not least of all because I’m working with firms in Australia, both Australian and globals, that have massively reduced their emissions, de-materialised, reorganised production, and invested in new technology etc. They’re doing this because they either are, or will soon be, forced to operate at lower levels of emissions. Business is ahead of governments in this area.

Companies such as Westpac are leaders as are insurance firms like Insurance Australia Group. Land developers like LendLease have completely redesigned their residential development models because governments require lower-impact housing – this affects all aspects of the development including the materials for the housing shell and it’s heating – again, not PR, business.

If I can give you but one example of why there will be a price on carbon – insurance forecasts for northern Queensland predict increases in premiums due to the increased risk of cyclones and tsunamis directly attributable to CO2 emmissions.

Yours is a rhetorical argument – it’s PR ’cause you say so but what is the basis for your views? Sustainability is good business and it is increasingly reflected in shareholder value.

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September 27, 2005 12:07pm

Logix

Kimble,

I entirely sympathise with your thoughts; if I could paraphrase them: “the governments we have are bad enough… a world government must be worse”.

Yet as inadequate as well feel most governments are, there is only one thing worse…no government at all. (Visit sunny Somalia for a current example.)

I agree that the concept of world government is deeply challenging. The principles of such thing, the balances and checks, and the mechanisms that gain the individual’s acceptance via their participation, have only been partially expressed in the structure we call the UN.

All governance at all levels of society has the potential for abuse, yet at no time in our history have we ever abandoned the concept. By contrast, the process of civilisation has driven us to evolve better forms of it.

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September 27, 2005 12:18pm

Paul W

Kimble/Logix,

It is entirely possible that carbon trading, like other forms of international trading, will not be a function of a world government beyond the establishment phase – even then, given the difficulties so far, it may be global investment funds that largely determine the nature of the market.

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September 27, 2005 12:46pm

B.J. Melville

Paul W,

Sustainability might have been good business with Kyoto looming but, now that it’s dead, all those companies that invested in overcoming the expected regulation are going to lose out big time. Expect to be looking for a new job in the near future as the global economic downturn will mean enviro-consultants will be the first to be retrenched, assuming that’s what you do.

Another thing, the quote about the QLD insurers raising their premiums because of ‘increased cyclone risk’ is a good one but did you consider that maybe it had more to with increasing their profits than reducing risk. We’re all having a chuckle about that one.

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September 27, 2005 12:57pm

Paul W

BJM: you’re still relying on a largely rhetorical position – you claim the businesses are “going to lose out big time” but produce no evidence or argument; I wonder why?

I don’t mind trading jibes, and I’m pretty relaxed about my employment prospects, but if you actually don’t know anything, best you just slowly withdraw from the discussion rather than huffing and puffing.

Kyoto isn’t looming, it’s being implemented in many markets (I mentioned the EU scheme, Europa, in an earlier post) and is driving significant amounts of investment – check out any of the investment fund indicies to see the number and quantum of sustainable investment funds for instance.

As for your comment about insurance, you evidently know very little about the industry, its regulation, or its profitability (hey, but don’t let that stop you…). Fact is, climate change in Australia has come close to bankrupting some smaller insurers – those that are over exposed to bush fires, hail storms and droughts (most) – these are all significant business risks that attract lots of research dollars much of which is briefed out… and, though you didn’t ask, I don’t mind telling you is v. profitable :>

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September 27, 2005 1:47pm

B.J. Melville

Ah, well Paul, If you can provide me with evidence that long-term changes in climactic conditions have come close to bankrupting any insurers in Australia, I will be in awe of you.

I personally wouldn’t call bush fires, hail storms and droughts, let alone cyclones, evidence of climate change caused by industrial carbon emissions. You would need to show a long term increase in frequency and then demonstrate that Australian industry was responsible for it. Impossible. That’s why I found the insurance analogy funny.

Obviously, it is in the interest of insurers to jack up their fees regardless of risk. Whatever hokey climate change story they invent to avoid ACCC prosecution is irrelevant.

With regard to Europe’s carbon trading system, it is clear that Blair has ditched it. Recall his exact words :

“I

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September 27, 2005 2:25pm

gazzadelsud

againLogix, i think you make good points. I dont really share your view of market failure. To answer this point may I only cite Adam Smith. To appallingly paraphrase, the net economic welfare is served by the selfish needs of the grocer, the baker and the butcher to address the interests of themselves and their families.

I find the argument for market failure to be unproven as yet in this instance.

Incidentally (and to my personal regret) i think the greenies have won the climate change battle for hearts and minds. Hence the discussion is on the instrument to achieve the objective. My take is that genuine market mechanisms – demand from consumers and technological innovation – will address this problem, rather than regulatory instruments which can so easily be gamed.

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September 27, 2005 3:33pm

Paul W

And you’ll provide all that evidence of the companies that are going to lose out “big time”? Yeah right!

Let me clarify, the insurance industry has been forced to do a major rethink following a series of insurance disasters. The 1999 hail storm was the largest insurance claim in Australia’s history (costing $170 million). There’s some very clever thinking going on now about business sustainability and climate change (and I’m not going to debate the science with you, I’ve done it before with others, it comes down to preferences and I’ll go with the mainstream view as articulated by CSIRO over you) and its impact on the costs of insurance.

Despite your comments earlier, the industry isn’t jacking up rates/profits – they’ve been stable and consistent (and have maintained a fairly consistent relationship with the ASX average) Again, best you limit your comments to what you know rather than speculating (is it the anonymity that emboldens you so?)

If you follow this link, you can read for yourself commentary from one of the industry’s acknowledged experts (and in case you’re wondering, no I do not work for IAG) http://www.acecrc.org.au/uploaded/117/797143_29iagclimatechange.pdf

The evidence here is from numerous studies and all conclude the same – that CO2 emissions affect climate change which will continue to impact on business sustainability.

Finally, as to Kyoto’s long-term health, I think you’ll find that the UK government continues as a signatory and continues as a member of Europa despite Blair’s comments (remember Fitzgerald v Muldoon – it’s not a matter for the PM to determine and certainly not through media comment) so that pretty well determines it.

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September 27, 2005 3:41pm

B.J. Melville

Paul W, What’s this? Are you distancing yourself from Tony Blair, the hero of the ‘new left’?

Again, let’s analyse Blair’s comments.

Is Tony Blair the Prime Minister of the United Kingdom of Great Britain and Ireland? Yes.

Did Tony Blair say that
“no country is going to cut its growth or consumption substantially in the light of a long-term environmental problem”?
Yes, he did.

Is the United Kingdom a country? Yes.

Will emissions regulation under Kyoto require countries to cut their consumption? Yes.

Therefore, we can assume that the UK wants nothing to do with carbon trading.

Kyoto is dead.

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September 27, 2005 3:55pm

Paul W

BJM: Nice dodge…

Blair’s a brilliant politician but you’re reaching if you think I give a toss about the new left.

Let’s stick to the issue at hand shall we…

I don’t see Blair’s position on Kyoto as definitive of anything. As I said, they’re still signatories to Kyoto and still in Europa so you and others are getting prematurely excited.

As to the rest of your argument, it’s a bit logic 101 isn’t it?

Kyoto clearly isn’t dead – the CDM and JI are still operating, there’s still carbon trading, the UK is still a member… are there other measures for it’s pulse?

McShane quotes a report where Blair identifies the problems, they’re well understood and as I’ve said previously, he’s just restating the Brundtland thesis from the mid-80s. Growth has to continue, agreed, but demand management will be part of the medium term future in any country that REMAINS signed up to Kyoto…

Incidentally, there’s lots of innovation and R&D in demand management and renewables – the only reason it’s not taken off in Australia is ’cause Howard is in bed with the mineral owners and doesn’t want to increase Minimum Renewable Energy Targets… this isn’t a sophisticated position, it’s a rort (just like their position on the sugar industry).

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September 27, 2005 4:09pm

B.J. Melville

Paul, where exactly are we at odds here? Is it the content of Blair’s speech?

“no nation is going to cut its growth or consumption substantially in the light of a long-term environmental problem”

This is contradictory to your statement on every level. Do you think he is lying perhaps? Or maybe he is just thinking pragmatically, as are Howard and Bush.

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September 27, 2005 4:41pm

Fox

To put the cost of Kyoto in to perspective the ‘junkscience’ website has a nice little kyoto count-up. Right now the cost of Kyoto has been $91,958,492,100 for a potential temperature saving of 0.0009539 degrees Celcius (in 2050)!!
No wonder none of the Kyoto-signees are on schedule to meet their targets. Even they can see it’s a waste of time.
Kyoto: 95% politics / 4.99% economics / 0.01% science …

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September 27, 2005 5:22pm

Paul W

BJM: we mostly disagree because I think you’re taking a simplistic approach by reducing the discussion to an argument about what Blair said, not what Kyoto is/was etc. But specifically, we appear to disagree about:

1. Kyoto is dead.

I disagree – Blair has just restated the essential problem (as identified in Brundtland), how to reduce CO2 emissions without unreasonably constraining growht – he can’t manage down demand for energy. This doesn’t spell the end for Kyoto – the UK is still in Kyoto, is still in Europa – Blair’s sounding off about very difficult problems – they’re trying to reposition themselves… maybe he’ll try to shape up a son-of-Kyoto.

2. Kyoto is just a PR exercise.

Nope, Kyoto is a first attempt to put a price on carbon. Various industries/OEMs are running ahead of Kyoto, others are way behind and trying to pull it down (heavy emitting stationary energy companies for instance). It is inevitable that there will be a price on carbon because it is increasingly critical to long term business sustainability – hence the material I linked to from IAG.

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September 27, 2005 5:48pm

Paul W

BJM: and you made some odd comments about the insurance industry but I think we’ve clarified that, well, that they were a little outlandish.

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September 27, 2005 5:51pm

B.J. Melville

Yes Paul, I think we cleared up that when able to act in unison, insurers have an incentive to raise premiums. That is first year economics.

However, what really intrigues me is what you are saying is at odds with what Blair is saying. Either you are lying, or Blair is lying.

Blair says nations will not adhere to the Kyoto protocols, you say they will. Who is telling the truth?

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September 27, 2005 6:35pm

Paul W

You seem to think I’m some adherant to Blarite politics – I’m not so I’m disinclined to jump to his defence (not that I suspect he’s shaken by your criticisms).

No one is lying – the world’s complex BJM, it’ll resist your need for simplicity.

Blair’s statement is just that – it’s not a repudiation of their current arrangements, it’s thinking out loud and probably positioning; the UK is still a signatory, is still in Europa and so your claim that Kyoto is dead remains pure rhetoric.

As to the accusation of insurance industry collusion – it is quite idiotic. You clearly know nothing about the industry’s regulation or the operation of the ACCC.

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September 27, 2005 6:44pm

B.J. Melville

There is a clear distinction between what Blair has said and what you are saying. You can’t have it both ways. Either nations are adhering to Kyoto or they are not.

Are any nations adhering to Kyoto?

Or is Kyoto dead?

Or is it all too complex for you to answer?

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September 27, 2005 6:58pm

Ms Marple

Shit, I really need to start reading the bits DPF posts before sounding off on these posts.
Looking at what Blair says, he’s not damning Kyoto, he’s being realistic about how countries are going need to approach achieving their targets. He says a country won’t “cut its growth or consumption substantially” not that they won’t cut their emissions. That is entirely consistent with his focus on technology as the driver for change. Which incidentally is not incompatible with Kyoto despite the US’s best efforts to paint it’s rhetoric about improving technology as directly dichotomous with Kyoto.
Reading further about Britain’s commitment to environmental efforts, one of the top stories in the Science section of BBC today is how it’s likely that a private members bill will pass (with good cross-party backing) that will mandate annual reporting on climate change initiatives. So Britain is far from jumping on the “no problem here” covered wagon.

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September 27, 2005 8:01pm

Ms Marple

Oh, so BJ – not complex at all. Britain’s in. Kyoto’s not dead.
Or at least no more dead it was when Bush pulled out. If only has father had pulled out instead.

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September 27, 2005 8:06pm

Paul W

Thanks Ms Marple.

You’ve said it better than I have/did/repeated/clarified/elaborated/restated/simplified/explained etc.

Much appreciated!

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September 27, 2005 8:55pm

B.J. Melville

Kyoto…

Dead.

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September 27, 2005 9:59pm

Ms Marple

Viva Kyoto!

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September 27, 2005 11:22pm

Paul W

BJM: yeah that about sums up your argument – an entirely unsubstantiated statement!

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September 27, 2005 11:48pm

James

Some one buy Ms Marple a vibrator…preferably a wind powered one! ;-0 Kyotos a sick dog ,lets put it down.

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September 28, 2005 2:39am

Ms Marple

James, with dildos like you around, I think I’m better staying with real men. But thanks for thinking of my needs. Now perhaps you should spare a thought for the planet.

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September 28, 2005 8:37am

dim

James – I’m shocked! What would Ayn Rand say about such language?

Your punishment is to walk down Queen St reciting Galts dumb-ass speech from the end of Atlas Shrugged. If you hurry you’ll be finished in time for the 2008 election.

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September 28, 2005 9:37am

Kimble

Heh, dim, like the Labour-Green collective is going to allow another election, good one. They damn near lost the last one, do you think they dont have the capacity to learn from their mistakes?

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September 28, 2005 10:49am

Wayne Mapp

Blair is envisaging a Climate change agreement post 2012. He knows US will not sign up to Kyoto, but he nees to be seen as the guy who bought US into the global consensus, and that will rquire some form of agreement that no doubt will have multiple options to suit each country. It will include carbon trading and techno change – a Toyota Prius looks quite attractive right now.

It is only 7 years to 2012 so he has to lay the ground now. Think of the statements that came out of G8 in May. Blairs latest statement is entirely consistent with that.

Not too many people are arguing that global warming due to mans action is all a bit of a hoax. George Bush has started to shift in this.

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September 28, 2005 10:57am

dim

Kimble – tell me more about this planned Labour-Greens plot to dismantle our democracy. Will they be using technology harnessed from crash-landed UFOs?

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September 28, 2005 11:18am

B.J. Melville

Wayne, it is highly unlikely that Blair will be in Whitehall in the year 2012. Glad you agree that Kyoto is dead though.

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September 28, 2005 11:41am

wayne mapp

A new agreement would have to be negotiated within the next 4 years, so Blair will be the key player. Implementation would take the next three years. I guess he may well see this project as his legacy from his third term.

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September 28, 2005 12:20pm

Paul W

BJM: your ability to convert any information into verification of your own view is truly admirable.

Wayne: I think you’re right on Blair’s intent. He will want to maintain a multi-lateral arrangment on climate change and will want to preserve the relationships and funds from within Kyoto and the related multi/bi-laterial agreements.

I think Bush, like Howard, will stuggle to do much in the medium term – Howard’s problem is structural, the mineral lobby and the fact that Australia has the highest individual C02 emissions in the world (the only reason Australia might have come in under the first round targets is because of significant changes to land clearing). Australia’s mountain of coal led to the development of industries that rely on cheap electricity – aluminium is pretty much solid electricity!

Did Bob Hawke’s comments about setting up Australia as the nuclear waste dump of the world get much play in NZ – it’ll go nowhere since it’s so politically unpalatable but as one of the worlds largest produces of uranium, you could argue Australia has some additional responsibilities.

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September 28, 2005 12:24pm

Paul W

BJM: have a read of Blair’s speech overnight, in it he restates the UK’s commitment to Kyoto (http://politics.guardian.co.uk/labour2005/story/0,16394,1579551,00.html).

Here’s the salient extract:

“Next year too, building on Britain’s Kyoto commitments, we will publish proposals on energy policy. Global warming is too serious for the world any longer to ignore its danger or split into opposing factions on it. And for how much longer can countries like ours allow the security of our energy supply be dependent on some of the most unstable parts of the world?

For both reasons the G8 agreement must be made to work so we develop together the technology that allows prosperous nations to adapt and emerging ones to grow sustainably; and that means an assessment of all options, including civil nuclear power.”

My take on this is, as I argued earlier, despite his musings, Blair and the UK remain committed to Kyoto even if they’d like to renogtiate aspects of it to make it more acceptable to the likes of Bush and Howard.

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September 28, 2005 1:40pm

B.J. Melville

So it was Blair that was lying?

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September 28, 2005 5:34pm

Ms Marple

No BJ. It was DPF who was selectively quoting.

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September 28, 2005 5:53pm

Paul W

BJM: go with whatever the little voices are telling you!

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September 28, 2005 6:15pm

B.J. Melville

I’m not sure what Blair wants the world to build on the rubble of Kyoto and I don’t care to speculate. The fact is Kyoto is dead.

Maybe it was designed to fail in the event of high energy prices… in any case, Britain had great incentive to opt out and strand its continental rivals. Note the revival of the British coal industry and the massive international acquisition programme undertaken by British resource giant Rio Tinto and others.

Not surprising seeing Kyoto was always about Europe and Japan maintaining their industrial competitiveness compared to resource rich developing countries, Germany, France and Japan having practically exhausted their economic coal reserves.

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September 29, 2005 10:13pm