Cap & Trade, Dead?
Research for Online Investors

by John Dalt

2/09/10

Cap and Trade legislation seemed almost a certainty last June when the House passed the American Clean Energy and Security Act of 2009  The bill would establish a cap and trade plan to reduce greenhouse gas emissions 17% by 2020.

The bill was pushed through the house by Pelosi and now sits on the Senate's agenda, ready for action anytime before session end next January.  The administration has pivoted from health care and climate change to jobs, jobs, jobs.  This is the reality of the political climate as unemployment hovers around 10%, and mid-term elections in November threaten to trim the majority’s membership.

While Washington is pandering to the perception that government can do anything to create jobs, the argument to institute climate change legislation seems more strained.  This week, a prominent scientist from Australia has called for reform of the International Panel on Climate Change (IPCC).  Some of the claims in the body’s reports are based on college student papers and environmental lobbying groups.

Dr. Carter, a marine geologist says of the mistakes, "They are all of the same sort, but the science they are doing is not high class or they are trying to manipulate the refereeing procedure."  He is frustrated with the use of the U.N. body to promote climate change, and the media for ignoring the politics for so long.  "In some cases, they alter reports after the scientists have signed off on them.  The perplexing thing about this, from the point of view of an independent scientist like me, is why the press has suddenly picked this up as a big story because it is a very old story", commented Dr. Carter.

Dr Carter says global warming is a natural occurrence.  "The question is not are carbon dioxide emissions causing warming," he said. "The question is how much warming are they causing or, more specifically, how much warming are the human emissions causing?  The IPCC and their scientists have now had 20 years. They have spent somewhere around $100 billion, thousands of scientists worldwide working on trying to pin down that human signal.  They haven't found it after 20 years. What it tells you is the human signal is so tiny that it is lost of the variation of natural climate."

The IPCC report took three years to write and involved over 3,000 authors and reviewers.  Looks like they could have used a few more fact checkers!

Barry Brooke, a climate professor at Adelaide University does not take issue with the greenhouse gas emission data in the IPCC report, just the predictions they try to make.  “Any time you go to try and predict something that is going to happen, obviously there is a big burden of uncertainty and there is going to be a lot of unknowns.  I wouldn't be disturbed at all if there wasn't another IPCC report," he said.  Professor Brooke says the IPCC is too big, too unwieldy and does not keep up with new emerging science, according to ABC News in their report, “Push to change Embattled Climate Panel."

We may have dodged the bullet on crushing climate legislation, but do not sleep well with thoughts that any of the world improvers have given up, they are just retreating, gathering more government grants and preparing another assault on freedom of commerce.  They should wait until summer, as Washington is currently digging out from 30 inches of snow, with another 20 inches predicted for tonight.  The opening of the new Climate Office had to be delayed because of cold weather.

The weight of wrong science may drag the whole climate change/global warming debate under water to be drowned and killed before it can destroy the world's economies..don't count on true believers giving up.

Sen. James Inhofe’s (R-OK) family built an igloo adjacent to the Washington Mall this weekend.  The igloo is signed with “Al Gore’s New Home” and “Honk if you (heart) Global Warming.”  I just love it when adults can help kids gore the ox of world improvers. (pun intended)

The sign says, "Al Gore's New Home"

Here is a fun video on Hayek vs Keynes subscriber D.P. from Colorado sent last week.  I don’t like rap, but made it through this one!

To the mailbag:
On PIIGS sovereign debt problems:” The characteristics of the great powers, the big fish eats, the richest guy will always get richer and the poor, poorer.  The euro is in crisis because of bond sales and Greece is only a sample of the desperation.  The USA will keep raising taxes like the rest of the third world countries.”—subscriber from Spain M.P.

John’s Reply:   I agree that the poor get poorer, IF they accept that they cannot succeed on their own.  This is the danger of socialism, it robs society of desire, because there is no reward.  Good luck to you.  Don't let the hacks in government dictate your success!  Socialism is the great leveler, erasing the wealth of generations.

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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