Sea Levels are Rising and there’s Nothing we can do about It so go ahead and Fire Up those Coal-Fired Power Plants

Posted by PITHOCRATES - July 1st, 2012

Week in Review

Good news.  There’s nothing we can do to lower the sea levels.  So we can stop all of that global warming nonsense.  And live life normally again (see Rise in sea level can’t be stopped: scientists by Nina Chestney posted 7/1/2012 on Reuters).

Rising sea levels cannot be stopped over the next several hundred years, even if deep emissions cuts lower global average temperatures, but they can be slowed down, climate scientists said in a study on Sunday…

“Though sea-level rise cannot be stopped for at least the next several hundred years, with aggressive mitigation it can be slowed down, and this would buy time for adaptation measures to be adopted,” the scientists added.

You know the best thing we can do to try and stop the sea levels from rising?  Stop trying to stop the sea levels from rising.

Volcanic eruptions have lowered global temperatures by throwing soot, ash and sulfur into the atmosphere.  Some famines have been blamed on volcanic activity shortening the growing season.  Making it cooler and wetter.  So volcanic eruptions lower global temperatures by throwing soot, ash and sulfur into the atmosphere.  You know what else throws soot, ash and sulfur into the atmosphere.  Coal-fired power plants.  Interestingly, the catastrophic rise in global temperatures corresponds to the attack on coal.  Could this mean that the global warming alarmists have caused global warming by their efforts to stop global warming?  Yes.  It could very well mean that.  And when some of their own talk about pumping sulfur in the atmosphere to combat global warming it’s even harder to dispute this.

It looks like the climate scientists may be responsible for global warming.  While the coal-fired power plants were keeping the global temperature down all along.  How about that?

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Hong Kong Protests their New Unelected Beijing-Approved Leader

Posted by PITHOCRATES - July 1st, 2012

Week in Review

The British returned Hong Kong to Chinese rule in 1997.  After more than a glorious century of British colonial rule.  And even though the people in Hong Kong were a colony of a distant power it turns out they were on the winning side of that deal.  For Hong Kong prospered while China got Chairman Mao.  Today the people of Hong Kong are proud of their British colonial past.  And much prefer it to the present Chinese communist rule (see Hong Kong holds big protest as new leader sworn in by the Associated Press posted 7/1/2012 on the Los Angeles Times).

The outpouring of discontent underscored rising tensions between the Communist mainland and the vibrant city of 7 million that was returned to China in 1997 after more than a century of British colonial rule. While much of the discontent revolves around growing economic inequality and stunted democratic development, Hong Kongers are also upset over what they see as arrogant Chinese behavior – wealthy mainlanders taking over retail outlets during flashy Hong Kong shopping trips, for example, or even the choice of language during Sunday’s swearing-in ceremony, Beijing-accented Mandarin instead of the Cantonese dialect spoken locally…

Leung was chosen as chief executive in March, winning 689 votes from a 1,200-seat committee of business elites who mostly voted according to Beijing’s wishes. Hong Kong’s 3.4 million registered voters, who can vote for neighborhood councilors and half of all lawmakers, had no say.

In mid-afternoon, tens of thousands of protesters began marching toward the newly built government headquarters complex on Hong Kong Island in sweltering heat, beating drums and waving British colonial flags in a gesture of nostalgia for an era during which democratic rights were limited but the rule of law was firmly in place…

In his speech, Hu said Hong Kong residents now have more democratic rights and freedoms than ever before – a reminder that China has largely kept the promise it made when it regained the territory from Britain to keep Hong Kong’s relatively open political system in place for 50 years.

But that did little to assuage the feelings of the protesters, who see China’sCommunist Party rule as strongly at odds with the values that many inherited from a British-influenced education, and the continuing spread of democracy to Asian neighbors like South Korea and Chinese-speaking Taiwan.

Yes, it was the British Empire that made Hong Kong the jewel it is.  Not the Chinese communists.  It was the British institutions of democracy, rule of law, free market capitalism and free trade that made Hong Kong the destination for the wealthy Chinese mainlanders when they really want to enjoy life.  And even though the Chinese suffered under British colonial rule today the best part of China would appear to be Hong Kong.  And in Hong Kong people wave British colonial flags in protest of Chinese rule.  Imagine that.

China has a long history.  Most of it remarkable.  But it reached a nadir under Chairman Mao and his People’s Republic of China.  And the spread of the deadliest contagion known to mankind.  Communism.  For as an ideology nothing killed more people.  And while China was suffering the great famines of the Great Leap Forward there was Hong Kong across the water.  Prosperous as ever.  An embarrassment to the communist rulers.  China is a lot better today.  As they let capitalism flourish.  Albeit under the heavy hand of the state.  But it’s one of the BRICS economies.  And may soon be the number one economy in the world.  But it’s still not quite Hong Kong.

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Life was Good for Women Entrepreneurs in Afghanistan but after the Americans Leave they may Emigrate to India

Posted by PITHOCRATES - July 1st, 2012

Week in Review

The American Left attacks the Republicans for wanting to turn back the hands of time for women in America.  Ridiculous, really, considering the success of women in this country.  There are women CEOs.  Women governors.  Women cabinet members.  Women in Congress.  Women on the Supreme Court.  (The first woman justice of the Supreme Court, Sandra Day O’Connor, was nominated by the man the Left hates most.  Republican Ronald Reagan.)  Women in the military.  Something usually associated with the Right.  So if the Right really wanted to turn back the hands of time for women it would be doubtful they would allow them into the military.  So the argument is silly.  And sad. Considering how the hands of time may move back for some women in the world (see Afghan women entrepreneurs look to India for opportunities by Rama Lakshmi posted 6/27/2012 on The Washington Post).

They run fleets of trucks, supply construction material, design software programs and make furniture. Women entrepreneurs in war-torn Afghanistan have been breaking many cultural ceilings in the past decade…

“It will be a big challenge once the Americans and the others leave. The local market in Afghanistan has not progressed much,” said Masuma Rezaie, 24-year-old founder of the evocatively named company First Afghan Lady Logistics and Services. “But there is big money in the Indian market.”

To this end, Rezaie and other businesswomen came to New Delhi on Wednesday to seek deals, training and technology from Indian companies. The three-day business-to-business meetings, facilitated by USAID and the Consortium of Women Entrepreneurs of India, comes at a time when the impending withdrawal of the international forces from Afghanistan is also raising concerns about the future of women’s rights to study and work…

Another entrepreneur, Malika Qanih, wants to learn the process of manufacturing herbal medicines from Indians.

“Afghanistan is rich in undiscovered, untapped herbs. Big business potential,” said Malika Qanih, 60, chief executive of Sun Pharma. On Friday, she will visit a factory owned by Shahnaz Husain, czarina of Indian herbal cosmetics.

Qanih hopes that Afghan women will not have to go back to the past after 2014. “Many countries have signed strategic partnerships with Afghanistan. I hope they will not forget to protect us even after 2014,” she said.

President Obama always said the War in Afghanistan was the right war. To put the Taliban and al Qaeda on the defensive.  And take away their safe sanctuary.  While the Iraq War was just a distraction.  But the Left didn’t like the War in Afghanistan any more than they liked the Iraq War.  So to appeal to his liberal base in an election year the president announced a timeline for the withdrawal of US forces.  Even though it is likely that the Taliban and al Qaeda will return once the international forces leave.  Raising concerns about the future of women’s rights to study and work.  While in America the Left warns women that if Republicans get into office they’ll have to suffer the horrors of paying for birth control.  And enduring back-alley abortions.

At least if the Afghan women don’t have the support of the American Left they have a safe sanctuary in India.  Where free market capitalism still can flourish.  As do women’s rights.  India may not be perfect.  For no country is.  But it’s one of the BRICS economies so they’re doing something very well.  So India provides hope for Afghan women.  A place that will let them keep the freedoms they gained in Afghanistan.  For in India they’ll be able to breathe free.  Hope.  And pursue their entrepreneurial dreams.  Something they can’t quite do in Iran, Afghanistan (other than doing business with the international forces) or Pakistan (which the Afghani women will presumably pass through to get to India).

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Oil and Natural Gas in East Africa are Bringing the Chinese and other Nations to Africa

Posted by PITHOCRATES - July 1st, 2012

Week in Review

The developed nations are falling in love with East Africa.  Why?  Because they have oil literally oozing out of the ground.  And enormous natural gas deposits are under the waters off Tanzania and Mozambique.  The kind they measure using the word ‘trillion’.  This energy bonanza is drawing the developed nations to East Africa to bring these resources to market.  And into their economies (see Oil and gas are the new African queens by Emily Gosden posted 7/1/2012 on The Telegraph).

“In the space of a few years, East Africa has become a feeding ground for most of the world’s oil majors, which have sniffed our resources of oil and gas on a truly gargantuan scale,” wrote Malcolm Graham-Wood, oil analyst at VSA Capital, in a recent note. And in the world of oil and gas where, as he puts it, “if you find it, they will come”, those gargantuan reserves are the key.

“It’s been known there’s oil here for 100 years,” Laurie Hunter, chief executive of explorer Madagascar Oil says. “It actually seeps out on the surface in places.”

But with exploratory drilling consistently exceeding expectations, the geology of East Africa is proving to be even better than once thought.

FTSE 100 explorer Tullow Oil began drilling by Lake Albert in Uganda in 2006 – the first well there since 1938. It has drilled 45 wells to date; 43 of them have hit hydrocarbons. The company says it believes the Lake Albert rift basin is a “a major hydrocarbon province in its own right”, with resources as high as 1.1bn barrels. French oil major Total and Chinese CNOOC have paid $2.9bn to buy into Tullow’s stakes…

But while the oil discoveries look transformational – for all involved – it is gas that is causing the most excitement. In the balmy waters of the Indian Ocean, off the coasts of Tanzania and Mozambique, gas discoveries are estimated to stand at more than 100 trillion cubic feet (tcf). Potential resources are significantly higher. By way of context, the UK’s entire annual natural gas consumption in 2010 was 3.3tcf…

But it’s not just the geology that makes East Africa so exciting – it’s also the geography. “Conveniently,” Mr Graham-Wood notes, East Africa’s gas “faces the lucrative markets of India and the Far East and is now a truly valuable commodity”.

The gas will be cooled into liquefied natural gas (LNG) so it can be shipped to Asia. Gas consumption jumped 21.5pc in China and 11.6pc in Japan in 2011, according to BP data…

Exploiting the reserves in East Africa is not without its challenges, as Mr Joyner notes from a recent visit to Mozambique. “There are no roads and you have to fly everywhere on dodgy twin-props.”

China has been particularly busy in Africa.  Building a lot of infrastructure.  In an infrastructure-starved continent.  Out of the goodness of their heart.  Unlike the colonial powers of times past.  And I’m sure it’s just coincidental that enormous natural gas reserves are located so close to China.  Just begging to find their way into that Chinese economy.  Where gas consumption has jumped 21.5% in 2011.  No, I’m sure that hasn’t a thing to do with their interest in Africa.  Even though they’re investing in the energy industry in Africa.

As the developed nations buy these resources it should bring money into the private economies of East Africa.  Or create them if they don’t yet exist.  Creating jobs.  A middle class.  And hopefully a stable society.  Complete with all the middle class institutions and the rule of law.  Raising the standard of living for all in East Africa.  By using the revenue from their energy sales to build an infrastructure in an infrastructure-starved continent.  Preferably one that favors their needs and not the Chinese.  Or the other nations flocking to East Africa.

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China pours Billions into African Infrastructure in Exchange for Lucrative Trade Agreements

Posted by PITHOCRATES - July 1st, 2012

Week in Review

China is pouring billions into Africa.  Apparently out of the goodness of their heart (see Track record by Andrew Moody and Zhong Nan posted 6/29/2012 on China Daily).

The relationship between China and Africa will come under the spotlight once again when leaders of up to 50 African nations will descend on Beijing in July for the Forum on China-Africa Cooperation…

China’s stock of overseas direct investment on the continent has increased eight-fold from $1.6 billion (1.3 billion euros) in 2005 to $13.04 billion at the end of 2010, the last year for which figures are available, according to China’s National Bureau of Statistics.

Trade has also seen a similar large increase with exports to Africa rising from $10.18 billion in 2003 to $59.95 billion in 2010.

In Africa itself the relationship is viewed as central. John Dramani Mahama, vice-president of Ghana, says dealing with China helps avoid the red tape linked to alternative sources of funding from the World Bank, the International Monetary Fund or various international aid agencies…

Meles says far from exploiting Africa, China was in the process of rescuing Africa from the so-called Washington Consensus of the past 30 years that dictated that the private sector was the best engine for development in Africa…

Only one dominant view of the China-Africa relationship seems to exist in the West – that it is an exploitative and neo-colonial one…

The retired diplomat also feels China offers a great role model for Africa in terms of showing what can be achieved with a commitment to develop.

“I can remember when Sanlitun (now the bustling entertainment district in Beijing) was just bush and Shenzhen was a small fishing port and now it is like Hong Kong. There is a feeling if they can do it, we can do it too,” he says…

[Samuel B.] Nagbe [assistant minister in the Ministry of Public Works in the capital Monrovia], however, says this also has drawbacks since there is a lack of competition when large infrastructure projects are offered for tender…

The overall relationship between China and Africa will remain a subject of debate. Philip Nyinguro, associate professor of political science and international relations at the University of Nairobi, argues the weak state of some African countries makes them vulnerable when they are cutting deals with any country, whether it is China or a Western power.

This doesn’t sound much different than the spread of the British Empire.  And British colonialism.  Only the colonies may not do as well under the Chinese than they did under the British.  For let us not forget that it was the British Empire that made Hong Kong the jewel it became.  Not the Chinese.

And that attack on the private sector?  The wealth that China is creating that allows them to invest in Africa came from the private sector.  Granted it’s not what the West would call the private sector.  It’s more state-capitalism.  However, it was the transition from communism to capitalism (at least towards capitalism) in the cities that ignited their economic ascent.  So, yes, even China must agree that the best engine for economic development must come from the private sector.  Because it’s what they used.  For the communists sure couldn’t make it happen.

There’s no such thing as a free lunch.  Clearly the Chinese want those African resources.  Just like the early mercantilist empires wanted colonies in foreign lands to feed raw materials to their economies.  The Dutch, Portuguese, Spanish, French and the British.  They’re just doing it a little differently.  By ‘crowding out’ all other foreign investment.  Who don’t ask any questions or place any conditions on their aid beyond the economics of their trade deals.  Giving them a presence in these African nations.  Who will expect favorable treatment in return for their generosity.  If not they can just pull it away.  And without a developing private sector these countries could return to where they were before the Chinese investments.  Or accept an expanding Chinese influence in their nations.  Just like a colony power.

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The French Socialists to Advance Policies that will drive the Wealth Creators out of France

Posted by PITHOCRATES - July 1st, 2012

Week in Review

No one likes austerity.  Even the nations who agreed to it to join the Eurozone.  Back when they were joining they all said they would keep their deficits and debt within Eurozone requirements.  But after a prolonged recession few are willing to cut back on government spending.  In fact, in France, they’re going to increase government spending by beating up on the rich (see Adieu, la France posted 6/23/2012 on The Economist).

AFTER the French Socialists last came to power in 1981, under François Mitterrand, the new government went on a spree of nationalisations, taking over 36 banks and several industrial groups, before quietly abandoning the policy and even reprivatising a few firms. Small wonder that French bosses greeted François Hollande’s election as president with more than a frisson of foreboding. What would the Socialists do this time…?

Even before the parliamentary elections on June 17th, at which the Socialists won a majority of seats, rhetoric against factory closures had been mounting…

Michel Sapin, the labour minister, has promised to make it so expensive for companies to lay off workers that it will no longer be worth their while. Firms that fire people while still paying dividends may be penalised. Another planned ruse is to force companies to sell factories, presumably along with the brands manufactured there, to competitors rather than close them down…

[The Socialist] party’s most popular campaign promises was to tax incomes of more than €1m at a marginal rate of 75%. The likely consequences will be much less admired. Some big companies will leave France or move management abroad in order to shield their executives from the tax. That will lead them to invest and hire more overseas rather than at home. Already, top foreign executives no longer want to join French firms. A new extra tax on dividends has further angered the business world…

But the most important consequence of stratospheric taxes will be less visible, at least at first. Marc Simoncini is one of France’s best-known entrepreneurs—and one of the few business leaders to denounce the new measures publicly. Why, he recently asked, would anyone want to start a business, invest and succeed in the most taxed country in the world?

Tax is not the only threat to executive pay. Last week Pierre Moscovici, the finance minister, announced that pay for bosses of companies in which the French state holds the majority of shares will be capped at a flat rate of €450,000, or roughly 20 times the wage of the lowest-paid worker… In some cases it will lead to a 70% pay cut… Measures to limit pay at fully private firms are expected before long.

Most French business leaders don’t think that the government is deliberately targeting them. They reckon that its motives are purely political—and that the Socialists are simply not aware of the damage their plans will do (most ministers have hardly any experience of business).

Behold class warfare on a grand scale.  This is socialism.  This is what being ‘fair’ is.  This is egalitarianism.  Everyone is equal.  Except the rich and successful.  Who the state enslaves.  To serve the people.  By forcing these executives to continue to do what so few people can do.  Run these big corporations profitably.  But they won’t reward them for their unique talents.  No.  Instead, they’ll enslave them.  Force them to keep producing wealth.  To keep creating jobs.  But to do so for a paycheck that’s less than most sports stars, movie stars, singers, writers, reality stars, etc., get.  Because these executives don’t earn their pay like these people who contribute so much to the world’s economies.

The Socialists believe these rich executives don’t do anything worthy for their pay.  That these corporations run themselves and only create wealth because of the workers in the trenches.  These are the important people.  Of course if they don’t need these rich executives why not just fire them?  Let these corporations spontaneously produce wealth and create jobs?  Because even the Socialists know that these rich executives are the only ones who can run these corporations and produce the wealth they so want to confiscate.  And if they fired these rich executives and tried to run these corporations themselves there would be no wealth to confiscate.  Because they have no business experience.  And they would only run these companies into the ground.  Just like the Soviet state planners did in the Soviet Union.

How did they get here?  Their social democracies.  Cradle to grave state welfare.  The people like it.  They love the free stuff.  The problem is it’s free only to them.  Someone has to pay for it.  Primarily those who work for the rich executives.  And the rich executives themselves.  Via confiscatory tax rates on the wealth they create.  But as they drive out these wealth creators from the country what will they tax?  As populations age there are more people consuming government benefits than there are paying for them.  Which means they need to raise tax rates ever higher.  Going so far as to nationalizing businesses.  Eventually there comes a point where even class warfare won’t work anymore.  Because there just won’t be enough wealth left in the country to tax.

These policies are not likely to make things better in France.  It may feel good for a little while to punish the rich.  But punishing the rich won’t reduce your taxes.  Or improve the economy so you can advance into a better and higher paying job.  But it makes good politics.  Which is why these politicians can win elections.  In Europe.  And in the United States. 

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