Friday, July 14, 2017

What Rick Perry really said about supply and demand

by Jeff Jacoby

Lordy, how the mean girls jeered when Energy Secretary Rick Perry offered some extemporaneous words of encouragement to workers at a coal-fired power plant in West Virginia last week.

"Here's a little economics lesson," Perry said in response to a question about how the coal industry can stay competitive when the shale revolution of the last 10 years has made the supply of natural gas so abundant and cheap. "Supply and demand: You put the supply out there, and the demand will follow."

Cue an avalanche of media scorn.

"Rick Perry Hilariously Misunderstands Supply and Demand Theory in Attempted Defense of Coal Industry," guffawed Newsweek, deriding Perry for not grasping an economic fact so simple that "even the vast majority of people who have never stepped foot inside an economics class" understand it. On MSNBC, Chris Hayes aired a story on Perry's remarks that led off with video clips of Donald Trump insulting Perry's intelligence. Time posted some of the mocking tweets that proliferated in response to Perry's words, including one with a link to his college transcript, showing the D he earned in an Economics class at Texas A&M 47 years ago.

Far be it from me to infringe any journalist's right to pour contempt on Perry's head. But it might be worth mentioning that before he became energy secretary, Perry spent 14 years as governor of Texas and presided over an incredible economic boom. On Perry's watch, Texas — driven by surging growth in oil and gas production — generated more than 30 percent of all new American jobs, and did more than any other state to lead the US out of the Great Recession.

True, he did once say "oops" in a debate. But perhaps Perry isn't quite as clueless about supply, demand, and the energy sector as all the media hilarity suggested?

Perry wasn't in West Virginia to teach a seminar in supply and demand theory. He was there to lead a bipartisan delegation through one of the most efficient coal-fueled electricity plants in the nation. The Longview Power Plant, just six years old, is a cutting-edge example of "clean coal" technology, built to generate electricity with greater efficiency and lower emissions than older plants.

For the first time ever, more electricity was generated in the United States last year from natural gas than from coal.
The coal industry has been struggling for years, beset not only by environmental concerns but also by merciless price competition from natural gas. In a market upheaval that no one would have predicted even a decade ago, the United States has become the world's foremost producer of natural gas. Recently coal was knocked from its perch as the dominant source of fuel for electric power; in 2016, for the first time ever, more electricity was generated from natural gas (33.8 percent) than from coal (30.4 percent).

Between the rise of natural gas, the political support for renewable energy, and the closing of older coal plants, many have assumed that the death of the coal industry is inevitable. But reports of coal's demise may be premature. "The improbable happens regularly when it comes to energy," writes economist Mark J. Perry, a scholar at the American Enterprise Institute (and no relation to Rick Perry). Just as the new technologies of fracking and horizontal drilling unexpectedly made it profitable to extract oil and gas from shale deposits, so too the newest clean-coal technologies, some still in their infancy, "could upend perceptions about coal's environmental impact."

In other words, those at work in the coal industry shouldn't give up on themselves: That was the context of Secretary Perry's visit to West Virginia. And that was the point he was making when asked how coal can hope to contend with the price advantages of shale gas. His answer — "put the supply out there, and the demand will follow" — wasn't intended as a microeconomics tutorial. It was intended to hearten workers at the leading edge of clean-coal power generation. Perry wasn't implying that no matter how much coal the industry produces, there will always be a demand for it. He was expressing confidence in the continuing ability of coal to compete in the energy marketplace, despite all the ways in which that marketplace is changing.

When so many Americans depend on coal for their livelihood and their lights, is that really a message anyone should laugh at?


How Fossil Fuels Will Help Us Confront Climate Change

The debate over climate change policy pits two competing visions of the future against each other.

On the one hand are the “true believers,” who see in global warming an existential threat to humanity. They want to slow the rise in temperature as soon as possible, and as much as possible.

Their policy prescriptions focus on the curtailment, or even elimination, of the use of fossil fuels, no matter the costs in terms of slower economic growth and increased poverty.

The “skeptics,” on the other hand, view global warming as a potentially serious issue. It might cause problems in the future, but the impacts cannot be determined now with any degree of certainty.

Instead of attempting to forestall future warming, they focus on policies that will build societal wealth as well as scientific and technological capacity by the most efficient means available. Given the existing state of technology, this includes the use of abundant fossil fuels to promote rapid economic growth.

The goal of the skeptics is to position society to deal effectively in the future with whatever issues may arise from global warming as they actually occur.

One possible version of the skeptics’ vision of a high-wealth, high-energy society was on vivid display last week in Dubai, where The Heritage Foundation was promoting the Index of Economic Freedom at the annual conference of the Academy of International Business.

The United Arab Emirates is a group of seven semi-independent emirates on the shores of the Persian Gulf, of which Dubai is the largest.

When the emirates gained independence in 1971, the population was about 275,000. Now it is about 9.3 million, making the UAE one of the fastest-growing countries in the world.

Economic growth has kept pace with population growth in the UAE, and the per capita gross domestic product is among the highest in the world at about $67,000 (based on purchasing power parity).

The UAE is an oil-producing state, and the economy is built on a foundation of abundant and cheap fossil fuels.

Unlike many other oil-producing states, however, where centralized control has hampered diversification and locked society into dependence on export revenue, the UAE government has promoted economic freedom and openness, rising to eighth place in the world in The Heritage Foundation index rankings and first place among the countries of the Middle East and North Africa.

Modern Dubai rises from the desert like a vision of Tomorrowland. Skyscrapers vie with one another for the most inventive architectural design, and the tallest building in the world, the Burj Khalifa, towers over them all.

A 14-kilometer artificial river surrounds the city. In heat that averages over 100 degrees on an annual basis, citizens move from air conditioned homes to air conditioned cars, buses, and trains, to air conditioned offices and shopping malls.

This is where the relevance to the climate change debate comes in.

The current average world temperature is about 58 degrees. The true believers in climate change are predicting global catastrophe if that temperature rises by a worst-case estimate of 7 degrees Fahrenheit. That would bring the world average temperature to about 65 degrees.

Dubai, today, is doing quite well at an average temperature 35 degrees higher.

Obviously, Dubai is on the cutting edge of technology and prosperity as a result of its oil endowment and government policies that promote economic freedom and growth.

Not every country has oil, but in a globalized market, cheap fossil fuels are available everywhere to spur rapid growth and technological change.

True believers want us to accept sacrifices now—and a poorer world—in favor of unproven policies to avert warming that may or may not occur, and that may or may not be harmful.

Skeptics instead want to grow and develop as fast as possible now in order to be better positioned to deal with whatever future challenges may come. The success of modern-day Dubai shows at least that the skeptics’ vision is plausible.

The true believers, on the other hand, have no examples or evidence to demonstrate that their policies of sacrifice can produce a better world for future generations.


America’s Energy Dominance Won’t Sacrifice Environmental Quality

President Donald Trump declared during energy week that the United States would “usher in a golden age of American energy dominance.”

From rolling back egregious offshore drilling restrictions and power plant regulations to a policy review to revive nuclear energy, the Trump administration is making important headway to unleash America’s vast energy resources.

But energy dominance need not mean disregarding our nation’s strong environmental record, as too many have assumed.

Every announcement the Trump administration makes on energy and the environment has been met with vitriol and hyperbole from activist organizations and radical pundits.

For example, when the Environmental Protection Agency and Army Corps of Engineers announced they were dismantling the Obama-era Waters of the United States (WOTUS) rule, Vice News wrote, “Trump takes steps to ensure more Americans have access to unsafe drinking water.”

Quite to the contrary, the WOTUS rule was an affront to private property rights and significantly overstepped the boundaries of proper federal government jurisdiction, and had little to nothing to do with safe drinking water, which is regulated under the Safe Water Drinking Act.

The compatibility of energy production and environmental protection featured strongly during a panel featuring three of Trump’s Cabinet members a few weeks back:

Ryan Zinke, secretary of the interior, emphasized improving the environmental stewardship of federal lands. The secretary plans to solicit input from the Western governors, native tribes, and citizens living in those states. Zinke emphasized unlocking valuable resources for private sector development and advancing human knowledge by promoting innovative technologies.

EPA Administrator Scott Pruitt is pursuing an agenda that rolls back regulations devoid of any significant environmental benefit. This plan empowers the states to customize policies responsive to local citizens.

Energy Secretary Rick Perry wants to reduce bureaucracy at America’s national laboratories, where technological innovation can yield significant efficiency gains.
The United States has long been a global leader in the realm of environmental safety.

Through innovation and investment in new technologies, as well as through legislation, rule of law, and all-important property rights, air and water quality have improved significantly in the United States.

Pollutants known to cause harm to public health and the environment have declined even as the U.S. has catapulted to the forefront as the world’s leader in oil and natural gas production.

Companies are incentivized by market pressures to constantly improve efficiency—and the environmental benefits that come with doing more with less follow directly from efforts to lower prices to remain competitive.

Although it may not line up with the efforts of the “Keep It in the Ground” movement, the reality is that the Trump administration’s efforts to strengthen an already dominant energy industry in the U.S. are fully compatible with a healthy environment.


More evidence of Greenie misanthropy

Recycling, washing clothes at 30°C and switching to energy saving bulbs are all touted as ways to help the environment.

But if you really want to save the planet, one of the best ways is to not have children, according to a study.

Researchers said that bringing new life into the world is easily the most destructive thing you can do to the environment.

By not having a child, the carbon footprint of an individual living in a developed country would be reduced on average by an extra 58.6 tonnes of carbon dioxide every year, based on current emission rates.

This is the biggest impact of all possible actions you could take.

The team from Sweden’s Lund University came to this conclusion after conducting an analysis of the things individuals can do to produce less greenhouse gases.

But they found that while we are told to recycle, no government in the western world is advising its citizens to limit their number of offspring.

The study found that the other three main choices people can make in order to cut the amount of carbon dioxide they produce are to eat less meat, get rid of their car, and fly less.

After analysing 39 studies and government reports assessing the impact individual lifestyle choices make on reducing CO2 levels, the researchers concluded that many of the ‘green’ activities governments recommend – such as recycling or fitting energy-saving bulbs – only make small reductions.

Lead author Seth Wynes – who does not have any children – said: ‘There are so many factors that affect the climate impact of personal choices, but bringing all these studies side-by-side gives us confidence we’ve identified actions that make a big difference.

‘We found there are four actions that could result in substantial decreases in an individual’s carbon footprint: eating a plant-based diet, avoiding air travel, living car-free, and having smaller families.’

He added that these actions ‘have much greater potential to reduce emissions than commonly promoted strategies’.

For example, recycling is four times less effective at reducing greenhouse gases than eating a plant-based diet, while using energy-saving bulbs is eight times less effective.

Living car-free saves about 2.4 tonnes of CO2 equivalent per year, while eating a plant-based diet saves 0.8 tonnes.

The impact of having a child is calculated by factoring in not only the extra impact of the child, but also that of their potential future descendants.

Writing in Environmental Research Letters, the authors said: ‘Persuading a US family to have one less child would provide the same level of emissions reductions as persuading 684 teenagers who do not recycle, to recycle comprehensively for the rest of their lives.’

Under the Paris Agreement, of which the UK is a signatory, everyone on the planet needs to reduce their carbon footprint to just two tonnes of CO2 a year by 2050 if we are to limit global warming to just 2C.

The Optimum Population Trust, of which Sir David Attenborough is the patron, has urged parents to ‘Stop at Two’.


Al Gore compares climate fight to slavery, gay rights & apartheid at Australian summit

MELBOURNE, Australia — Former Vice President Al Gore likened the battle against “global warming” to previous social causes. Gore spoke to the EcoCity World Summit in Melbourne Australia on July 13th. The conference is being held from July 12-14.

“Abolition of slavery, woman’s suffrage, anti apartheid movement, civil rights movement, stopping toxic phase of nuclear arms, gay rights, all these movements have one thing in common. they were all met with ferocious resistance,” Gore said on July 13th during his talk to the conference in Melbourne.

Other speakers at the summit tied climate “solutions” to social causes.  Climate activists admitted that  “Carbon Neutral” goals were being used to achieve “gender & social equity.”
Johanna Partin spoke about the CNCA or Carbon Neutral Cities Alliance. In her talk, she clearly stated a key “mission” of going “carbon neutral” was to “increase gender and social equity.”

Partin joins many other climate activists who are using the man-made global warming scare to advance other agendas that have nothing to do with climate.

Author Naomi Klein, author of the new book “This Changes Everything: Capitalism vs. The Climate”, admitted during the 2014 People’s Climate March in New York City activists would be caling for the same “solutions” even if there was no climate “crisis.” She was asked, “Even if climate change issue did not exist, you would be calling for same structural changes?” Klein responded:  ‘Yeah.’

Following the panel, Climate Depot asked Klein if she would support all the same climate “solutions” even if the science was wrong.

“Yes, I would still be for social justice even if there was not climate change. Yes, you caught me Marc,” Klein answered sarcastically as she abruptly ended the interview.


University of Pennsylvania Geologist Dr. Robert Giegengack noted in 2014, “None of the strategies that have been offered by the U.S. government or by the EPA or by anybody else has the remotest chance of altering climate if in fact climate is controlled by carbon dioxide.”

In layman’s terms: All of the so-called ‘solutions’ to global warming are purely symbolic when it comes to climate. So, even if we actually faced a climate catastrophe and we had to rely on a UN climate agreement, we would all be doomed!

The United Nations has publicly stated its goal is not to ‘solve’ climate change, but to seek to redistribute wealth and expand its authority through more central planning. UN official Ottmar Edenhofer, co-chair of the IPCC Working Group III, admitted what’s behind the climate issue: “One must say clearly that we redistribute de facto the world’s wealth by climate policy … One has to free oneself from the illusion that international climate policy is environmental policy. This has almost nothing to do with environmental policy anymore.”

EU climate commissioner Connie Hedegaard revealed: Global Warming Policy Is Right Even If Science Is Wrong. Hedegaard said in 2013, “Let’s say that science, some decades from now, said ‘we were wrong, it was not about climate,’ would it not in any case have been good to do many of things you have to do in order to combat climate change?”

The UN is seeking central planning. UN climate chief Christiana Figueres declared in 2012 that she is seeking a “centralized transformation” that is “going to make the life of everyone on the planet very different.”

The UN and EPA regulations are pure climate symbolism in exchange for a more centrally planned energy economy. The UN and EPA regulations are simply a vehicle to put politicians and bureaucrats in charge of our energy economy and ‘save’ us from bad weather and ‘climate change.’




Preserving the graphics:  Most graphics on this site are hotlinked from elsewhere.  But hotlinked graphics sometimes have only a short life -- as little as a week in some cases.  After that they no longer come up.  From January 2011 on, therefore, I have posted a monthly copy of everything on this blog to a separate site where I can host text and graphics together -- which should make the graphics available even if they are no longer coming up on this site.  See  here or here


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