Letters to the Editor: Global Warming

THERE IS MUCH MORE to report on the recent conference in Boston, sponsored by the U.S. chapter of the Association for the Study of Peak Oil & Gas (ASPO), dear readers. But I feel compelled to take a timeout and run another Whiskey & Gunpowder Letters to the Editor column. Naturally, I enjoy the privilege of replying to your comments. I will get back into more discussion of the ASPO conference presentations in my next article.

Global Warming and Reader E-mail

My account on the global warming presentations that were delivered at the recent ASPO conference in Boston generated quite a bit of e-mail. In fact, I received more e-mail from readers on the global warming article than I have received on any article I have ever written in Whiskey & Gunpowder. That is a lot of e-mail. And the really interesting thing is that virtually all of the e-mail was negative toward global warming (if not toward me), a matter upon which I will expand below.

Labels and E-mails, Short and Sweet

Some of the e-mail was in the nature of people just venting. Here are some examples, just so that nobody can accuse me of not offering a fair reflection of what was in the Mailbag. One reader named John, location unknown, sent a one-word e-mail (or should it be two words?), that said, “bull****.” (That is the PG-version of the e-mail.) Another reader, whose e-mail name is “Twlug,” sent another one-word comment, “sucker.” A reader named Ted sent a comment that was almost as short and sweet, “Byron King is a nut!”

I hope that you will forgive me, dear readers, if I do not go deep into the merits of these foregoing comments. (Or as Richard Nixon might have said, “I am not a nut!”) Global warming has been the subject of very serious scientific research by many and diverse internationally respected scientists. It is unfortunate that people want to label the study of the phenomenon with comments that indicate cavalier dismissal of the entire body of research.

But these terse commentators are in somewhat good company, sharing their skepticism with no less an authority on the subject than U.S. Sen. James Inhofe, chairman of the Senate Committee on Environment and Public Works. This upstanding member of what some people refer to as the “world’s greatest deliberative body” has said that the idea of catastrophic global warming is the “greatest hoax ever perpetrated on the American people.” But why think small on such a grand topic? If statistics are to be believed, global warming is one of the greatest “hoaxes” ever perpetrated on large numbers of people in the history of the world. Next to the myth of the U.S. dollar as the world’s “reserve currency,” I suppose. But I should not digress. Back to the topic.

In June 2006, for example, the Pew Research Center published a survey based on worldwide research into peoples’ self-described “concern” about global warming. The term “concern” includes being “a great deal concerned” or a “fair amount concerned” about global warming. More than 90% of Japanese are “concerned” about global warming, and we all know how gullible the Japanese are. Well over 80% of people in locales as distant as Spain and India are “concerned,” thus providing evidence of the multicultural nature of this “hoax.” About 65% of Germans and 62% of Chinese are “concerned” about global warming, probably because their collective brains are clouded by their national merchandise trade surpluses with the rest of the world’s economies. And about 53% of Americans are “concerned” over the concept of global warming, apparently victims of the residual mind-alteration experiments conducted by Al Gore, using that new-fangled Internet-thing, when he was vice president. So Sen. Inhofe has his work cut out for him, disabusing so many people around the world of the “hoax” of global warming. And thanks for the short e-mail, guys.

Here are a couple of fairly representative letters from readers:

Comments by Reader Linn, Location Unknown

“Byron buys into the global warming hysteria. I have read that for years, but also have read the calmer, unreported-on summaries of climate studies that demonstrate that global warming is cyclic and man has little effect on it… Global warming is not so much science as ideology. Bad ol’ industry, bad ol’ capitalists, bad ol’ big government opponents. I do not believe that real science and reason stand a chance on this one. The environmentalists, the most dishonest political faction in the world, will destroy the economy.”

Comments by Reader Joseph From Illinois

“Greg, both you and Byron should be ashamed of yourselves. This, as presented, is pure political posturing! Is there global warning as described…yes! Does humanity contribute to it? Yes again, but so far to a RELATIVELY small effect. Again, all you have to do is look at the history of the world as to both global freezing and global warming. The world has been there and done that more than once before! [There is] enough heat in socialist scientific thought to melt Antarctica. Think of the grants, the laws, and the power to be obtained!”

Byron Replies: The three individuals who gave global warming presentations at the ASPO conference were all quite careful to provide their data in a measured fashion. I detected no apparent “hysteria” in the messages, except for whatever logical conclusions one might draw from what could happen when world atmospheric CO2 levels regress to an Eocene-like concentration and sea levels begin to rise. (Could this be just another reason to sell that condo in the declining south Florida housing market? You will have to read Mish’s articles in Whiskey & Gunpowder on the ending of the American housing bubble.)

In my travels, I have read and heard numerous presentations on global warming, from the likes of NASA’s James Hansen and Harvard’s Dan Schrag and their scientific peers. In virtually every case, the presentations included data that reflect the cyclical nature of the Earth’s previous warming-cooling sequences. No one who works in the field of climatology, and certainly in the field of paleoclimatology, has ever claimed that mankind is the “only” reason that CO2 levels are rising in the Earth’s atmosphere. Nobody who understands the science claims that mankind is the only cause of whatever is occurring to alter climate on a worldwide scale.

But what is clear beyond any serious argument is that whatever is occurring within the Earth’s atmosphere, mankind’s carbon-burning activities are contributing to a measurable degree to the adverse effects. Mankind’s use of carbon-based fuel is contributing to the change in amplitude of whatever “cycles” are occurring. As Dan Schrag said clearly at the ASPO conference, “Science is uncertain about a lot of what is happening. But most of what we do not know about these rapid changes in conditions is dangerous.”

All three individuals who gave presentations at the Boston ASPO conference were careful, to the point of being scrupulous, to note that “industry,” “capitalists,” and “government” are going to be part of the solution to the problem. (Geologist Dan Schrag gives his global warming talks at such bastions of counterculture and deconstructionism as the Harvard Business School and Kennedy School of Government.) The ASPO-sponsored discussion of global warming in no way offered an indictment of capitalism or the general idea of economic progress, except insofar as what modern industrialism has built is presently sustained, almost in its entirety, by a fast-depleting fuel supply. With this latter point in mind, it is the height of irresponsibility, if not cultural insanity, not to think about how to make prudent changes that will avert an eventual breakdown of the whole system.

It is certainly unfair to call the ASPO-sponsored discussion anything like “socialism.” (Actually, the ASPO organizers have all been quite successful in their own careers, within what passes for the U.S. “capitalist” system.) And I have to take issue with the inference that concern about global warming by the so-called “environmentalists” will “destroy the economy.” As frequent readers of Whiskey & Gunpowder probably know, what will destroy the economy is the current unpayable level of debt at every level.

On this last topic, the gargantuan U.S. national debt comes to mind, along with the $65 trillion (yes, “trillion”) in unfunded future liabilities of the U.S. federal government alone. Couple these unpayable levels of current and future debt with ongoing depletion of traditional energy supplies and the decline of the U.S. manufacturing base, and the future of the U.S. economy is quite bleak. In the future, in other words, the U.S. will purchase depleting oil supplies from whom? And pay with what, the declining dollar? (If you don’t own gold, you had better get some.) Thus, one of the key themes of the economic viewpoint and investment approach of Agora Financial is that we are all living in an “Age of Empire,” or I should probably say an “Age of Empire in Decline.” If living in an empire in decline does not happen to kill you, you might just make some money along the way if you understand the trends:

Comments by Reader Mark From New York City

“Byron, you need to read up on the work of Bjorn Lomborg, who has written a lot about the political correctness and hysteria behind the claims for global warming. Dissenting voices are shamed into silence, and their grant money dries up.”

Byron Replies: Thank you, Mark. I have read some of what the Danish author Bjorn Lomborg has written, to include reading some of the chapters in his 2001 book The Skeptical Environmentalist. Lomborg makes many good points about the politicization of science in modern times and the impact of centralized control of funds over the direction and thrust of scientific research. Lomborg’s great contribution is his continuing effort to separate what is real from what is, at root, merely “scary” and based on sensationalist headlines. It is important to focus on real problems, and to direct political and economic capital to things that can make the biggest difference.

Interestingly, Lomborg wrote an article that appeared on the editorial page of The Wall Street Journal (Nov. 2, 2006), a newspaper not otherwise known for its alarm-ringing concern over global warming. Lomborg was criticizing the 700-page “Stern Review,” released a couple of weeks ago by the government of the United Kingdom, which addresses the issues of climate change and global warming. Despite his criticisms of the report, Lomborg stated in his WSJ article that the report “correctly points out that climate change is a real problem, and that it is caused by human greenhouse-gas emissions.”

“Correctly points out…” the man says, “that it is caused by human greenhouse-gas emissions.” This is quite a qualifying statement coming from Lomborg, and it actually goes beyond anything that anyone said at the ASPO conference. The scientific consensus is that climate change is a natural phenomenon, and that it occurs over periods of time, both short and long, in response to changes and variations in the Earth’s dynamic systems. There is a long-standing, verifiable, “natural” basis for climate change, as revealed in the fossil records of the Earth. When it comes to contemporary CO2 emissions and associated global warming, the reputable scientific consensus is that the activities of mankind are “contributing” to climate change, which is quite different than saying that the activities of mankind are “causing” it.

From Reader Bud, Location Unknown

“I’m a bit amazed to see [Byron] has become a partisan in the global warming ‘movement’. Having very loosely followed the global warming agenda for some time, and with some awareness of what has actually happened in the past history of Mother Earth, I continue to be unconvinced that activities by man are ‘causing’ global warming. There is a difference between the natural warming-cooling cycle of the Earth, on the one hand, and the coincident effects of accelerating carbon use by man, on the other — both of which influences are undeniable.

“The question arises, however, as to which of these fundamentally ’causes’ global warming. It is logically sound to assume two proximate causes of ‘warming’ can — and probably do — become mutually re-enforcing in cumulative effect. It strikes me as wildly unsound, however, to assume that past patterns of global warming (prior to the emergence of man), which are now repeating can be logically assigned to increased input of human carbon usage — and to an explicit assertion that cutting such carbon usage will materially reduce the peak of that (evidently) natural cycle when it is achieved.

“The ‘Global Warming Gang’ has steadily gained adherents as years have passed, with the press flogging the agenda every step of the way. Many seem to have forgotten that decades ago, during a period of global cooling, we were warned no less severely that if governments did not join for collective action, the surviving human population would end up shivering nearby the equator, closely embraced north and south by advancing glaciers that would threaten our final extinction. Thereafter, of course, the temperature trend changed and we have heard no more from those who relied upon their ‘scientific’ convictions that such a trend — like a tree — inevitably grows to the sky. It was nonsense, of course, but the press and the usual suspects in government and the scientific community touted it no less foolishly therefore. It is unsurprising their spiritual inheritors are now clamoring for ‘action’ to avert the opposite climatic extreme…

“The solution to the increasing use of carbon power is high prices. When that day comes, the market, not the government, will seek solutions in short order. First among these will doubtless be safe nuclear power. Wind, solar, [geothermal], and tidal power technology in their present development are nonstarters as major contributors, but every little bit helps. The U.S. is first among power-hungry users, and China is rapidly advancing to overtake that first position. The drain of market supply of carbon-based energy sources will eventually become an irresistible force mandating change, with or without Peak Oil. That is, the ‘energy crisis’ and the ‘global warming crisis’ will likely be met by common solutions — and neither need be dependent on empowering an already too-powerful government to further extract and inevitably further abuse the wealth of citizens to pursue the ‘good cause.’ The government has no capital that it does not extract from others. It is therefore folly to assert the government can accomplish an outcome which private capital cannot — except by debasing the currency, which is the inevitable consequence of public (aka deficit) funding for grand government projects.

“What I find particularly disingenuous is that Bill Bonner & co. so loudly and repeatedly decry efforts by other ‘world improvers’ to impose their elitist ideas, but now implicitly endorse exactly the same coercion of others by law and taxation to support a particular ‘world-improving’ notion they happen to fancy. That smacks of utter hypocrisy — and you may surely tell Mr. Bonner I said so.”

Byron Replies: Bud, your e-mail is rather long, but I want the readers to see the points that you are making. And this way, Bill Bonner can read for himself what you think. I do not know where Bill is just now. He might be at his workplace in Paris, or visiting the Agora offices in Germany, or at his hacienda on the Pacific coast of Nicaragua, or at his humble Ponderosa high in the Argentine Andes. Have you spotted the trend yet? One way or the other, I think that Bill Bonner — whose family hails from the steel mills of Donora, Pa., and the tobacco farms of the Maryland Eastern Shore — and his progeny will probably make it though the next couple of generations.

Just so you know, Bill Bonner does not dictate the editorial content of the publications that come out of Agora Financial. He might be a principal in the ownership structure of the company, but he does not drive whatever “notion [he] happens to fancy” into the product line. Bill’s attitude toward business development is more along the lines of “If you are going to try something and it might fail, then fail quickly, cut your losses, and get it over with.”

So if we run a few articles about global warming in our ongoing opus entitled Whiskey & Gunpowder, we will just have to see how many people ask for their money back. Whoops. Nobody pays any money to receive Whiskey & Gunpowder. So you cannot ask for your money back. You just enjoy the feeling of making money if you can spot the investment themes that we embed within our collective thinking process. And you make even more money if you subscribe to the other fine newsletters and trading services offered by Agora Financial.

Last Word, Amazing Grace

So Bill Bonner has given me a lot of leeway to write what I write for Whiskey & Gunpowder. And I would like to use my last few words, before Bill fires me (just kidding…), to refer to an article published last week in the Oct. 30 edition of Aviation Week & Space Technology.Aviation Week is, if you are not aware, one of the world’s most authoritative publications on developments in the aerospace industry. Also known as “Aviation Leak,” it is required reading within the secure halls of every self-respecting intelligence service of every government on the planet. Coincidentally, the Aviation Week article to which I am referring, and my modest article on global warming, were both published on the very same day. Small world, huh?

Under the caption “Ice Melting, Too,” the Aviation Week article noted the following:

“A pair of U.S./German satellites has added to the body of evidence that global warming is melting the polar ice caps, generating data that the Greenland ice sheet is losing almost 100 gigatons of ice per year. The twin Gravity Recovery and Climate Experiment (Grace) spacecraft detect changes in the mass of the part of Earth directly below with precise measurements of the distance between them as they orbit in close formation. Scientists at NASA’s Goddard Space Flight Center have used that data to calculate the weight of the ice on Greenland with enough precision to determine that the summertime melting in coastal regions (shown in blue in the image below) is about three times the wintertime gain in the interior (orange , in the image below). That works out to a loss of about 41 cubic miles of ice lost overall per year in 2003-05. Scientists using less-detailed Grace data already have estimated that the ice sheet in Antarctica lost about 36.5 cubic miles of ice between April 2002-August 2005. While lower than the annual loss from the Greenland ice sheet, it was still enough to account for 13% of the observed rise in sea level during that period (AW&ST March 13, p. 17).”

So if we are reading the gravimetric data correctly, the ice sheets of Greenland are melting three times faster in summer than they are regenerating in winter. And thus Greenland has suffered a net loss of over 120 cubic miles of ice mass over the past three years. As the graphic that I have linked above makes quite clear, the principal areas of ice melt are the eastern and southeastern ice sheets of Greenland.

How much ice is 120 cubic miles? Think of a sheet of ice one mile thick, one mile wide, and 120 miles long, that has just plain melted away. That would be enough ice to fill a sizable part of the Grand Canyon. Or if you are one of those effete Easterners who thinks that there is nothing worthwhile west of the Hudson River Valley, think of Long Island, the largest island in the continental U.S., being buried in ice. That is, buried in ice from the lower tip of Manhattan to the easternmost tip of land, south of New London, Conn., to a depth of almost 500 feet. Only the tops of the tallest skyscrapers would be visible above the ice sheet surface. All of this ice is just gone, vamoosed, having melted and flowed downhill to the sea in a matter of three short years. As Bill Bonner says about some things that intrigue him, “Hmmm…” (He said that to me about Peak Oil, just before he started shopping for a ranch high in the Argentine Andes, far from, as they are sometimes called, “everybody else.”)

Greenland has held a relatively stable ice sheet for the better part of the past half million years. But the ice is now being destabilized and melting. Something is going on, and it is not just sunspots, of which there have been many over geologic time. At the very least, the prudent investor ought to think about buying real estate that is located at elevations of more than a couple hundred feet above sea level. Current sea level, that is.

Until we meet again…
Byron W. King
November 7, 2006