Public Service

10-15 flushes & the media is still floating

Pie chart of our water use

In 2018, Congress passed the WaterSense Bill which meant that the EPA would only attach WaterSense labels to products that are 20% more water-efficient and perform as well as or better than standard models. The legislation was passed because of long-standing issues with respect to water conservation. According to a 2014 Government Accountability Report, 40 out of 50 state water managers expect water shortages under average conditions in some portion of their states over the next decade.

Streamgages.png

Of interest on p.51 of that same GAO report was the admission that “State water managers and other experts we interviewed said maintaining the streamgage network is critical… …Specifically, 40 of 50 state water managers identified collecting data to determine the quantity of available surface water, a function that streamgages provide, as very or somewhat importantMoreover, many state water managers reported that increasing the number of streamgages to collect water quantity data would be a useful action federal agencies could take to assist states’ water management efforts. USGS works in partnership with more than 850 federal, state, tribal, and local agencies to operate and maintain the network of over 8,000 streamgages around the United States.

As the report documents in the chart above, 3,500 streamgages have been discontinued. Which begs the question, why aren’t legislators looking at getting better access to data with which to make more informed decisions?

What do you know? The GAO pointed to the following:

“In response to these data concerns, federal officials told us that insufficient funding is a primary barrier to expanding their data collection efforts. For example, an USGS official told us that the agency is committed to expanding data networks, but USGS’s ability to collect data at more locations, improve timeliness, and conduct additional analyses is severely hampered by funding constraints.

Wouldn’t it be better to bash Trump for demanding more budget cuts at the USGS (ignored by Congress by the way) instead of taking him to task for his style and manner in elucidating concerns over the efficacy of WaterSense legislation in practice?

Yet the mainstream media just couldn’t help but take everything out of context in order to mock Trump. His remarks about flushing toilets “10-15x instead of once” is now headline news. Not the president’s questions with respect to whether the newly labelled products are living up to the product claims. If the media wants to bash him, they only need to do a little digging to find plenty of factual ways of criticizing him instead of playing than man rather than the ball.

Thomas Sowell perhaps said it best with respect to government spending and efficacy,

Those who cry out that the government should ‘do something’ never even ask for data on what has actually happened when the government did something, compared to what actually happened when the government did nothing.”

EU climate emergency vote is way worse than you think

What took the group thinking EU so long? What better way to justify more taxation and wealth redistribution than to declare a “climate emergency”? What you are about to read is a perfect explanation of how little credibility exists in the European Parliament (EuroParl).

In black and white, EuroParl noted,

EU countries should at least double their contributions to the international Green Climate Fund, Parliament says. EU member states are the largest providers of public climate finance and the EU’s budget should fully comply with its international commitments. They also note that pledges by developed countries do not meet the collective goal of 100 billion USD per year as of 2020…Finally, they urgently call on all EU countries to phase out all direct and indirect fossil fuel subsidies by 2020.

Now, this is where it gets curious. Take a look at this file (from page 8) and ask yourself, how many amendments to resolutions within the “climate emergency” conversation were rejected supporting the overall declaration passing 429 in favour, 215 against, 19 abstaining?

Here is one amendment that was rejected 95, 563, 9 by MEPs (you can’t make this stuff up),

Recalls that climate change is one of the many challenges facing humanity and that
all states and stakeholders worldwide must do their utmost to measure it
scientifically so that policy, and especially spending, is based on observable facts and not on apocalyptic fearmongering or unreliable models; emphasises that there is
no scientific consensus on what percentage of climate change is anthropogenic and
what percentage is natural

Seems fair enough! Basing decisions affecting 550 million constituents on real hard data is the right thing to do, no? Clearly not. Shut up and follow the religious cult and demand followers cough up twice as much into the collections pot. The lobbyists must be well pleased.

Or,

“Text as a whole without the words: ‘urgently’, ‘and implement’ and ‘to net-zero
emissions by 2050″ defeated 101, 555, 15.

Isn’t it striking that the majority of MEPs won’t even consciously vote in favour of making sure funds are spent appropriately? Nope, bow down and shut up. Otherwise face being cut off as we get to observe from the EuroParl documents below.

This is what an MEP from Northern Ireland, Claire Fox, had to say,

Madam President, I voted against the climate and environmental emergency motion because I’m really concerned at the hyped-up anti-science scaremongering that’s terrifying young people, telling them that billions will die, that there’ll be a collapse of civilisation, a lot of the rhetoric coming out of Extinction Rebellion and echoed in the debate over the last few days. I think that the fact that we voted against an amendment today that said that we should be committed to bringing the environmental subject back to rational discussion, and we rejected it, admits that actually, we’re having an irrational discussion. This becomes advocacy and propaganda, rather than science. There’s no scientific evidence from the IPCC or anyone else about the extinction of humanity, and we should be very careful about claiming that anthropological climate changes cause floods and droughts, which we have been doing quite casually during the last few days. In fact, the IPCC says that such issues are probably caused by socio-economic conditions, and we forget socio-economic conditions too much and demand, in fact, as this Parliament has done, decarbonisation, which will lead to eco-austerity, massive price hikes in energy, and ordinary working people paying the cost for scaremongering and...

(The President cut off the speaker)

or another Northern Irish MEP Robert Rowland,

Madam President, I’d just like to reiterate what my colleague said. I also rejected the COP24 resolution. I may not be an Economics Professor, but I do profess to understand economics. They also call it the dismal science, but when it comes to the climate emergency, I would describe the apocalyptic forecasts as nothing but science fiction. The adoption of these policies today, and the aim of carbon neutrality by 2050 is nothing short of reckless and the most extreme example of economic illiteracy I’ve ever seen. The fact that amendments were rejected demanding a full impact assessment shows rank indifference to the cost and practicality of aggressive climate policies.

One thing I can say for certain is that the impact of net-zero makes the consequence of any form of Brexit look puny by comparison. Dieter Helm, Professor of Energy and Economics at Oxford University, was right when he said: ‘We should be honest that it is a huge industrial undertaking, and it will have significant cost. These are enormous industrial activities, there is nothing in history that looks like this outside of wartime.

In my own country, our own Chancellor has put that cost at over one trillion pounds, or almost 2% of GDP per annum. It is an insane policy.

If the EU truly wishes to make itself even less competitive, in the face of some of the world’s highest electricity prices, they are only self-flagellating in an already flailing economy which continues to slow to 5-year lows. If the EU truly looked at its record since 2007, it would see its policies have delivered 40 million more people into poverty, a number which totals 118 million people, or 23% of the EU population!

If there was ever a bigger load of intellectual dishonesty posted by the EU it would be this. It states that,

Climate emergency declarations in 1,195 jurisdictions and local governments cover 545 million citizens with 53 million of those living in the United Kingdom. This means in Britain now roughly 80 per cent of the population lives in areas that have declared a climate emergency.

The irony if such a statement is that there is no way in the world that 545 million citizens are in agreement within those 1,195 jurisdictions. 53mn Brits? Seriously? In Australia’s case, many declaring climate emergencies have been local green-left councils who have made idle gestures without backing it up with realities. Constituents have not been asked. Windfarm plans for Warringah are not on the agenda.

The greatest irony with the EU is that they classify biomass (which is more polluting than coal) as a renewable and gives it a zero-carbon emission weighting provided a tree is planted per tree burnt. Sadly trees take 40 years to fully grow to be able to offset that produced. However, we will discover that the fine print taketh away the wonderful headlines.

Will the Poles ditch their coal industry to comply or face savage reprisals from Brussels? Will the EU guarantee Poland gets huge subsidies to pay for its termination? Which country would be so blind as to put their livelihoods into the hands of the EU!? The Greeks might have a view as do the Brits.

This action will spectacularly blow up.

By all means ride the short term wave of renewables stocks but be sure to line up all of those nasty fossil fuel companies into the portfolio that get pummeled by financial markets because the type of economic disaster that will beset the EU will only create the conditions where the peons will revolt and force a return to the way things were. Efficient, cheap and reliable forms of energy that will make a proper dent in the poverty line rather than promises and handouts.

The EU needs to learn the lesson that “Charity is injurious unless it helps the recipient to become independent of it.” It won’t be long before the youth of today get to embrace their love for socialism. Experience is a hard teacher. They’ll get the test first and the lesson afterwards.

Scorched house climate policy?

As 30cm of snow fell on Falls Creek yesterday (i.e. summer), Mother Nature proved yet again she is full of surprises. To think that giving loads of money to the UN can somehow change her stubborn ways is rather obtuse.

Less of a surprise was a protestor, Melinda Plesman, who brought parts of her burnt down house to attack the PM Scott Morrison for allowing the climate crisis to happen. Forget that the Australian Institute of Criminology (AIC) reports consistently that c.85% of fires are either deliberately, accidentally or suspiciously lit. Forget that multiple children have been found responsible for lighting these recent mega-fires. Just blame climate change, even though the Western Australian fire service notes on its own website that there is no evidence of such. CM wrote about that here.

Maybe Plesman could reflect on the internal politics within the upper echelons of the fire services? Not so much the rank and file (supposedly wife-beating) front line firefighters but the bureaucrats who make daft decisions such as buying a Boeing 737 fire-bomber which can only be used at 4 airports rendering it highly inflexible (as much as it’s a great political sales point) or a military helicopter which spends 5hrs in the maintenance shed for every hour it is in the field working. Or replacing 1-yo trucks with brand new ones because records are poorly kept? Or inadequate removal of fuel from the bush floor?

While it is completely understandable Plesman and 100s of others like her, are devastated that their houses have burnt to the ground, had Scott Morrison erected 1000s of wind turbines and solar parks since he took over the top job, it would not have made the slightest dent in the 1.3% of global emissions that makes up Australia’s share of the global total, nor have prevented these fires.

PM Morrison should arrange his RAAF jet to take Plesman to Beijing to tell President Xi that he is to blame for causing c.30% of global human-made GHG emissions and rising. She can then openly criticise Chinese policy that won’t approve new renewables projects unless they are cheaper than burning coal. What a surprise such investments are c.40% down on the previous year in China. What a shock that China has 100s of new coal-fired power plants on the drawing board?

It is easy to forget that Australia ranks #3 in the world for renewables spending per capita. We spent $9.5bn on clean energy last year, almost twice as much as France with its Paris Climate Accord loving Macron at the helm.

Unfortunately, it is too easy to capitulate to the cabal of climate change activism. Submit to the script of 11,000 signatories, despite the fact it included the likes of Mickey Mouse, Albus Dumbledore and Araminta Aardvark. Ignore that a recent major scientific paper, which claimed to have found rapid warming in the oceans as a result of manmade global warming, was withdrawn after an amateur climate scientist found major errors in its statistical methodology. Or the accident-prone Bureau of Meteorology and its 85% senior management structure which is in dire need of a thorough investigation.

Alarmists love to hate the coal industry. Plesman expressed her disdain too. It is a line often pushed by the climate change movement that Australia is responsible for the emissions caused by those who burn our black rocks overseas. By that measure, perhaps we should blame the Japanese, Koreans and Europeans for all of the emissions caused by the production and use of the 1,150,000+ cars we buy but are required to import each year? Or the Americans and Europeans for the commercial aircraft that belch all that nasty CO2? Or manufacturers of mobile devices and computer periphery? Maybe all the solar panels and wind towers, often built with raw materials from the fossil fuel industry?

CM honestly feels sorry for Plesman and others that have suffered such losses from these devastating bushfires but it doesn’t absolve them of getting to grips with the facts. She can be absolutely sure that even if Australia went 100% renewable and stopped exporting coal, that severe bushfires will continue to plague our future. As the WA Gov’t’s Bushfire Front states, “The only factor we can control is the large contiguous accumulations of fuel. Therefore, broadscale fuel reduction burning is the only defence we have against large wildfires. This will not prevent fires occurring, but it will ensure fires are less intense, are easier and safer to control and will do less damage...Experienced firefighters do not fear a 40-degree day per se. This is because even on a hot day, a fire in one or two-year old fuel can be controlled; on the same day a fire in 20-year old fuels with high winds would usually be unstoppable.

Bathurst Council declares climate emergency

Bathurst Council has managed to just squeeze through a climate emergency resolution. Of course the vote is a way to crank up the crony capitalism by favouring renewables. One imagines ending the iconic Bathurst 1000 car race would offset anything the council could achieve through abatement measures, even though they run on a 15% ethanol blend.

First point of order should be to ban the Bathurst 1000. No way that beer swilling fossil fuel loving V8 Supercar junkies can be tolerated if we are to save the planet.

The annual race causes an explosion in economic activity to the city. The race brings in around $30m extra to the local economy with 255 full time jobs equivalent. The population swells by 4x on race weekend.

So banning it will make the climate transition a doddle. CM dares you!

This can only end in tears

ECB.png

As Sweden’s economy slows to the worst economic growth rate in 5 years under a negative interest rate policy, one would think the Swedish Central Bank (Riksbank) would be seeking to prudently manage its asset book on the basis of appropriate risk/reward as opposed to lecturing Australia and Canada on their respective carbon footprints. What we are witnessing is yet another discrete move by authorities to manipulate markets based on fantasy rather than fact.  The hypocrisy is extreme as we shall discover.

While the Riksbank should have complete freedom in how it wishes to deploy capital, we should view this is a pathetic sop to the cabal at the European Central Bank (ECB). Since when did central bankers become experts on climate change? The RBA is no better. Deputy Governor, Guy Debelle, gave a speech in March 2019 on the risks posed by climate change which based prophecies on the data accident-prone IPCC and Bureau of Meteorology. Why not seek balance? Easier to fold to group think so as not to be outed as a pariah. Utterly gutless. Our own APRA is also pushing this ridiculous agenda on climate change reporting. It is willful negligence.

While it is true that on a per capita basis, Australia and Canada’s emissions are higher than the global average, why doesn’t the Riksbank give us credit for lowering that amount 11.4% since 2000? Even Canada has reduced its carbon emissions by 7.3% over the last 18 years. Admittedly Sweden’s emissions per capita have fallen 21.9% according to the IEA. Greta will be happy.

Why hasn’t the Riksbank taken China or India to task for their 169.9% or 94.7% growth in CO2 emissions respectively? There are plenty of oil-producing nations – Qatar, UAE, Bahrain, Saudi Arabia and Oman that have worse per capita outcomes than Australia or Canada. Do these countries get special dispensation from the wrath of the Riksbank? Clearly.

The US has pulled out of the Paris Climate Accord. If the US has marginally lower emissions per capita (15.74t/CO2-e) than Australia (16.45t/CO2-e), isn’t a double standard to write,

The conditions for active climate consideration are slightly better in our work with the foreign exchange reserves. To ensure that the foreign exchange reserves fulfil their purpose, they need to consist of assets that can be rapidly converted to money even when the markets are not functioning properly. Our assessment is that the foreign exchange reserves best correspond to this need if they consist of 75 per cent US government bonds, 20 per cent German and 5 per cent British, Danish and Norwegian government bonds.

Essentially Riksbank commitment to climate change is conditional. The US which is responsible for 13.8% of global emissions can be 75% of holdings. Australia at 1.3% can’t. No doubt sacrificing Queensland Treasury Corp, WA Treasury Corp and Albertan bonds from a Riksbank balance sheet perspective will have little impact on the total. In short, it looks to be pure tokenism. The Riksbank has invested around 8% of its foreign exchange reserves in Australian and Canadian central and federal government bonds. So perhaps at the moment, it is nothing but substitution from state to federal. Why not punish NSW TCorp for being part of a state that has 85%+ coal-fired power generation?

At the very least the Riksbank admits its own hypocrisy.

The Riksbank needs to develop its work on how to take climate change into consideration in asset management. For instance, we need a broader and deeper analysis of the issuers’ climate footprint. At the same time, one must remember that the foreign exchange reserves are unavoidably dominated by US and German government bonds. The Riksbank’s contribution to a better development of the climate will, therefore, remain small. This is entirely natural. The important decisions on how climate change should be counteracted in Sweden are political and should be taken by the government and the Riksdag (parliament).

Still, what hope have we got when Benoît Cœuré, member of the Executive Board of the ECB, lecturing those on “Scaling up Green Finance: The Role of Central Banks.” He noted,

2018 has seen one of the hottest summers in Europe since weather records began. Increasing weather extremes, rising sea levels and the Arctic melting are now clearly visible consequences of human-induced warming. Climate change is not a theory. It is a fact.

Reading more of this report only confirms the commitment of the ECB to follow the UN’s lead and deliberately look to misallocate capital based on unfounded claims of falling crop yields and rising prices (the opposite is occurring) and rising hurricane and drought activity (claims that even the IPCC has admitted there is little or no evidence by climate change). Sweden is merely being a well-behaved schoolboy.

Cœuré made the explicit claim, “The ECB, together with other national central banks of the Eurosystem, is actively supporting the European Commission’s sustainable finance agenda.

CM thinks the biggest problem with this “agenda” is that it risks even further misallocation of capital within global markets already drowning in poorly directed investment. It isn’t hard to see what is going on here. It is nothing short of deliberate market manipulation by trying to increase the cost of funding to conventional energy using farcical concocted “climate risks” to regulate them out of existence.

Cœuré made this clear in his speech,

once markets and credit risk agencies price climate risks properly, the amount of collateralised borrowing counterparties can obtain from the ECB will be adjusted accordingly.

What do you know? On cue, Seeking Alpha notes,

Cutting €2bn of yearly investments, the European Union will stop funding oil, natural gas and coal projects at the end of 2021 as it aims to become the first climate-neutral continent.

All CM will say is best of luck with this decision. Just watch how this kneeling at the altar of the pagan god of climate change will completely ruin the EU economy. The long term ramifications are already being felt. The EU can’t escape the fact that 118mn of its citizens (up from 78m in 2007) are below the poverty line. That is 22% of the population. So why then does Cœuré mention, in spite of such alarming poverty, that taking actions (that will likely increase unemployment) will be helped by “migration [which] has contributed to dampening wage growth…in recent years, thereby further complicating our efforts to bring inflation back to levels closer to 2%.

Closer to home, the National Australia Bank (NAB) has joined in the groupthink by looking to phase out lending to thermal coal companies by 2035. The $760 million exposure will be cut in half by 2028. If climate change is such a huge issue why not look to end it ASAP? This is terrible governance.

Why not assess thermal coal companies on the merits of the industry’s future rather than have the acting-CEO Philip Chronican make a limp-wristed excuse that it is merely getting in line with the government commitment to Paris? If lending to thermal coal is good for shareholders in 2036, who cares what our emissions targets are (which continue to fall per capita)? Maybe this is industry and regulator working hand-in-hand?

The market has always been the best weighing mechanism for risk. Unfortunately, for the last two decades, global central bank policy has gone out of its way to prevent the market from clearing. Now it seems that the authorities are taking actions that look like collusion to bully the ratings agencies into marking down legitimate businesses that are being punished for heresy.

This will ironically only make them even better investments down the track when reality dawns, just as CM pointed out with anti-ESG stocks. Just expect the entry points to these stocks to be exceedingly cheap. Buy what the market hates. It looks as though the bureaucrats are set to make fossil fuel companies penny stocks.

ESG Blacklisted portfolio

ESG (Environment, Social Responsibility & Governance) blacklisted stocks. We all know deep in our hearts that vices are far more fun than virtues. Real Coke tastes better than Diet Coke. Full cream is better than skim. McDonald’s fries are tastier than mashed potato. CM made this point in yesterday’s piece on the irresponsibility of socially responsible investing for building a retirement nest-egg given the long term underperformance.

When all of this politically correct ESG investing meets a recession, these oversold anti-ESG darlings, many with gobs of free cash will look like total bargains. Suffice to say in a downturn, vices tend to be what people resort to.

All CM cares about is the G in ESG. Governance is a must for investing. E & S are merely subjective views which don’t automatically convert to shareholder value. Good governance goes without saying.

So perish the thought that CEOs, like Harvey Norman’s Katie Page are being attacked by the likes of Ownership Matters which thinks putting in a shareholder activist who has failed 49 times out of 49 to be appointed to ASX listed boards is a better bet? As Janet Albrechtsen of The Australian wrote,

A copy of the report obtained by The Australian reveals Ownership Matters has recommended that Stephen Mayne be elected to the board of the retailer, even though the 50-year-old has no corporate experience in retail or property, no corporate board experience and no corporate management experience…Harvey Norman has a market capitalisation of $5.2bn, and shares in the retailer have gained more than 32 per cent over the past year, outperforming the 16.4 per cent gain in the benchmark S&P/ASX 200 over the same period…The advice sent out on Monday has baffled Ms Page’s husband, the business’s billionaire co-founder Gerry Harvey, who remains its largest shareholder, retaining ­direct ownership of almost a third of the company. “I have been on a public company board as chairman since 1972, and I have never seen anything as bizarre as the fact that the best ­retail executive in Australia is to be replaced by a ratbag called ­Stephen Mayne who has been a proven failure … every time he’s run for a board seat,” Harvey said.

 

Donald Trump Jr’s new book #1 on NYT Best Sellers list

Donald Trump Jr. was quick to share the good news of hitting NYT’s #1 best sellers ranking, on Twitter.

“I dedicated #Triggered to the Deplorables and you guys made it #1… let’s do it again at the voting booth in November. You are the best!!! #MAGA”

Liberal heads must be exploding.