CALL FROM A FRIEND — WHAT DID I TELL YOU

This is no time to celebrate.

EMR got a call from a friend this week. They opened with:

“Glad to catch you, I thought you might be on a victory tour in the Carribean or Southern Europe – too cold for Canada or Northern Europe.”

?Why so; What celebration?

“Well you have a lot to celebrate. I have known you for 20 years and over that time and especially in the last eight years you have been railing against folks that are now taking their lumps”

?Who is that?

“Well the list is long:

“Auto manufacturers (and their ad agencies) who have been misleading citizens about the use cars and the Mobility and Access Crisis. Now they are headed for bankruptcy – OK the ad agencies are still raking it in but not for long.

“The shelter industry that has been offering and financing the Wrong Size House in the Wrong Location is in deep trouble for neglecting to address the Affordable and Accessible Housing Crisis.

“Developers that have been putting up orphan subdivisions with a 7-11 and calling it “new urbanism” are going down. How about General Growth Properties! What a name! And then there all the jack-legs building on 10 acre lots and Toll Brothers of the world who build “estates”… All major contributors to the Helter Skelter Crisis.

“Even Wal*Mart is postponing opening stores, has rolled out a 15,000 sq foot store and is taking the advise of its green advisers and is trying to improve its image.

“The real estate market – especially for McMansions and for ‘starter homes’ in orphan subdivisions – is in the gutter – 30 straight months of decline.

“OK it is going down in some places but not everywhere. Citizens who followed your advice and invested in shelter near jobs and services and then went further and invested time and effort in their Dooryard and Cluster and in their schools and in “neighborhood watch” are doing OK and some are doing very well.

“Even the new census data through June 2008 supports your views.

“Finally, the last two federal elections have wiped out a lot of those who have been selling the environment and the Bay (and the air and the oceans) down the drain to support “growth”

OK, I get your point.

Back early last fall Fahmah, who had recently read and edited Volume I of The Shape of the Future said something similar. “You must feel pretty good that all the things you predicted in your book in 2000 are proving true.”

EMR thanked Fahmah for the complement but should have amplified it by what he told the recent caller:

THIS IS NO TIME TO CELEBRATE.

A lot of good citizens are being hurt by the actions they thought were in their best interest but were not because they relied on bad advice and conventional wisdom.

A lot of good Enterprises are suffering through no fault of their own.

Some good Agencies are in trouble because they did not intelligently prepare for the future.

A lot of good Institutions are being stretched to the limit.

This is all because of the greed and ignorance of some “entrepreneurs,” some governance practitioners and a lot of BeliefTank shills who worship at the feet of Business-As-Usual and Politics-As-Usual.

Citizens are attacking the symptoms and the symbols, not the root causes of the turmoil.

The Economists Intelligence Unit (EIU) predicts a ‘global pandemic of unrest.’ Workers at a Caterpillar facility took supervisors hostage because of threatened layoffs. It was the third such incident in France. The EIU report lists 95 potential problem nation-states.

No one warned citizens of the consequences of 35 years of burning through Natural Capital – not the Agencies, not the Institutions and not the media that is now owned by Enterprises.

Almost no one is yet talking about Fundamental Transformation of human settlement patterns, just the result of dysfunction.

Almost no one is yet talking about Fundamental Transformation of governance structure. As long as citizens are suck with a 1790s ideal of a three level governance structure without a rational allocation of control to the level of impact, there will be no improvement.

Almost no one is yet talking about Fundamental Transformation of the economic system. As long as there are agents, brokers and blind investments; as long as there are secret bank accounts, tax havens and tax-free Institutions and as long as there is no fair allocation of costs there is no hope of evolving a real market economy.

There is celebration about getting rid of plastic bags at the grocery store but what about the packaging inside the reusable bags? What about the security of the entire food supply that is dependent on cheap fuel – fertilizer, industrialized farm machinery, transport and the water that cheap fuel can pump from dwindling aquifers?

There is celebration of curly light bulbs and of smart grids but what about the impact of a high voltage grid to bring cheap coal generated electricity to energy hogging distributions of human activity?

There is celebration of green buildings with sod roofs but what about that vast majority of the buildings that are not only dumb but leave the lights on all night which – along with the roadways where Large, Private Vehicles drive with their own lights – light the sky not the places where citizens need to see. What about motion detectors on every light. That would light up the good guys AND the bad guys.

There is celebration of hybrid cars but the ones that Detroit is pushing are full sized SUVs, muscle pickups and $100K battery packs. The plan is to spend most of the stimulus to build and rebuild roadways for vehicles that are not sustainable in settlement patterns that are the root cause of dysfunction.

Conservation organizations are crowing about “saving” 20 percent of the land area in the “best” jurisdictions when the number should be 95 percent. At least some are supporting Regional and Community food chains and opposing Big Grids.

Citizens have been abandoned by the old Fourth Estate as it is swallowed by the Second Estate. There is no Citizen Media on the horizon because no one yet understands how to make money from Citizen Media. As a result citizens do not have the information they need to make intelligent decisions in the Market Place or in the voting booth.

The planning profession is still mired in support of Business-As-Usual and Politics-As-Usual.

No, this is no time to celebrate. But thanks for the call, EMR appreciates those who at least read what he has been writing for two decades.

EMR


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77 responses to “CALL FROM A FRIEND — WHAT DID I TELL YOU”

  1. Larry G Avatar

    Headline:

    "Record Drop in January Index of Home Prices"

    Standard & Poor’s Case-Shiller Home Price Index, a widely watched measure of 20 metropolitan areas, fell 19 percent in January from a year earlier. That was a record drop, slightly edging out the previous month.

    The worst hit metropolitan areas have now fallen nearly in half. None of the cities showed month-to-month improvements. Thirteen showed record annual rates of decline.

    “There’s no daylight that I can see in this report,” said David Blitzer, chairman of S.& P.’s index committee.

    He cited the numbers for Phoenix, the quintessential boomtown, as “gruesome.” Prices there fell 5.5 percent from December, and are now down 48.5 percent from its June 2006 peak.

    Las Vegas, Miami, San Francisco and San Diego are not far behind. All have fallen more than 40 percent. The best performing city in the index is Dallas, down a mere 10.8 percent from its peak. Unlike the rest of the Sunbelt and the coasts, Dallas never had a boom, so it did not have as far to fall.

    Here is what passes for good news in the Case-Shiller world: in a handful of cities, including Minneapolis, New York and Charlotte, N.C., the rate of decline in January slowed a little from the rate of decline in December.

    The 20-city index is now at 146.40, its lowest point since September 2003. The peak was 206.52 in July 2006.

    Joshua Shapiro, chief United States economist for MFR Inc., said in a note to clients that “it is unlikely that we are anywhere near a bottom in nationwide home prices.” He estimated the index was perhaps two-thirds of the way through its ultimate total decline.

    That would bring big city prices back to where they were in late 2001 or early 2002 and would probably encourage another round of beleaguered owners to surrender their underwater homes.

    http://www.nytimes.com/2009/04/01/business/economy/01econ.html?hp

    so a question for EMR

    is this the correct antidote for the "helter skelter crisis" ?

  2. Larry G Avatar

    look here.

    I am informed that for the first time in a decade that local teachers can afford a local home and they’re buying them…. some awesome deals available…

    think of it – the pool of truly affordable homes just got bigger than the one double-wide fixer-upper ….

    woooo hooo

  3. Anonymous Avatar
    Anonymous

    THIS IS NO TIME TO CELEBRATE.

    Things are not nearly bad enough to cheer up EMR.

    RH

  4. Anonymous Avatar
    Anonymous

    Prices are down, but units sold are up. Infact,the dollar volume of sales in Feb 2009 was higher than in Feb 2008 in some places, notably California.

    Every loss is someone else’s gain, but they aren’t necesarily equal losses to gains.

    Do we come out of this mess with a net social gain, thanks to the magic of the market?

    Nope, if you did, then the winners could afford to pay off the losers and still be ahead.

    In this case we have huge real losses, and they are likely to result in slower gains for environmental and social projects for the forseeable future.

    This is no time to Hooray financial losses to the people and firms we love to hate. We should want everyone to do well, so they can do good.

    RH

  5. Larry G Avatar

    here's an interesting foreclosure chart of the Wash Metro Area:

    http://fredericksburg.com/blogs/view?blogger_id=22&p=1238531214

    need to get EMR to explain the bright red stuff…

  6. E M Risse Avatar
    E M Risse

    Larry asks for an explanation of the bright red on the CoreLogic Zip Code map for which he provided a link.

    EMR could tell you but then he would have to have someone kill you.

    No, wait. EMR could tell you but then he would have to send you a bill.

    OK what does the bright red mean?

    First, what does the map intend to show?

    “February 2009 Foreclosure Rate by Zip Code” literally means the percentage of foreclosures in the month of February. That means that the bright red areas (2.8% +) have foreclosures at an annual rate of over 34 percent? Not likely. The map probably means in the 12 months ending in February 2009.

    Second, the map illustrates all the problems of Zip Code data discussed in the post ZIP CODES AS DATA SOURCES. If you know a lot of other information this information is useful, but it raises more questions than it answers. The size, gerrymander and homogeneity / heterogeneity of these Zip Codes vary wildly. It is a nice data display but …

    Too squeeze all the intelligence one can from this map:

    The bright red is an indication of a convergence of:

    Predatory Lending

    Fraudulent Activities

    Unethical Agents

    Negligent Agency Action

    An bad location, location, location (depending on each location.)

    What else does the map tell you?

    The folks in Spotsy/Fredericksburg, Warren, Clark and especially Jefferson WV drove too far to qualify. Too bad Culpeper, Rappahannock and Frederick / Winchester were taken out of the Wash PMSA for political reasons. That data might tell you more.

    The folks in Stafford, Prince William and Southern Fauquier (a different world down there) bought more house than they could afford when the price of gasoline went up.

    Some other observations:

    Several observers have noted two equal-sized groupings of forecloses:

    McMansions from $410k to around $590k and

    McStarters from $210k down to $130k

    with almost nothing in the middle (from $210k to $410k).

    There are a lot of underwater dwellings over $600k but each one represents such a big hole in any mortgage work-out staffers portfolio that they get special attention and do not show up as foreclosures very often.

    The McMansions seem to have lost around 40 percent when you can compare a foreclosure and resale in a short time frame.

    Those in the lower bracket lose less value. So much for helping out the less-well-to-do with bargains.

    On that note:

    Larry’s point re good deals for teachers only holds water IF the price has hit bottom. Otherwise the teacher has just lost their down payment that could have been invested in a modest dwelling in a better location that would not lose value.

    One final note. Those watching the NCAA March Madness (Men and Women) or the NIT know that the Nat Assn Realtors is adverting that this is the time to buy and one should contact a Realtor ® who KNOWS your market. A word to the wise:

    Get the recommendation that this is the bottom of the market (and thus time to buy) in writing with a buy back clause if the market declines, if you cannot get that stay on the fence.

    Somewhere there was a story recently on the high percentage of foreclosure sales that get foreclosed on again as the market continues to fall. ALL those sales get added to the total volume of sales figures.

    Who was it that stuck their neck out and said that the market was 2/3 of the way down? If the dwelling is the Wrong Size House in the Wrong Location there is no bottom.

    Have a good evening but it is not time to celebrate.

    EMR

  7. Anonymous Avatar
    Anonymous

    The Prez is dropping the other shoe. Tim Kaine is also retiring at the right time. The federal trough at which Virginia feeds will not be so full. The next Governor might need to implement some real cuts. What is means for housing and anything else is subject to debate.

    Senator: Expect painful cuts in Pentagon budget

    Mar 31 12:54 PM US/Eastern
    By LOLITA C. BALDOR
    Associated Press Writer

    WASHINGTON (AP) – A Senate defense committee chairman says Pentagon budget will include large, painful cuts. Senate Armed Services Committee Chairman Carl Levin said Tuesday that major program cuts will not be pushed off until the 2011 budget, but will be included when Defense Secretary Robert Gates sends his spending plan to the president later this month.
    Levin’s comments confirmed what many contractors and military leaders have expected, but he offered no details on which programs may be axed. He said Pentagon officials have indicated they will not be able to submit the much-anticipated spending plan by April 21, as initially hoped.
    The Michigan Democrat also told reporters at a breakfast meeting that he is reserving judgment on whether the multi-billion-dollar contract for replacement of the Air Force’s aging refueling tankers should go to one company or be split between two rival bidders. Other key lawmakers have suggested a split.

    The Air Force selected Northrop Grumman/EADS over competitor Boeing Co. for the aerial tanker project last year, but reopened the bidding after the Government Accounting Office found flaws with the decision.

    Levin said that if the Pentagon recommends a winner-take-all strategy for the tanker contract, he believes Congress would go along with it if the argument is powerful enough.

  8. Anonymous Avatar
    Anonymous

    "ALL those sales get added to the total volume of sales figures. "

    Oh come on. This is technically corret but insignificant beyond belief.

    Estimates are that befroe this is over 1.5 million homes will be foreclosed on.

    http://www.bloomberg.com/apps/news?pid=20601087&sid=ahwzaBwuNaII&refer=home

    There are 102 million homeowner owned dwelling and 160 million huseholds if you think som rentals have been foreclosed on.

    That means that less than 1.5% of home inthe us are ausing all this trouble.

    That is not gong to make snots worth of difference to the sales figures if some of those get foreclosed on twice.

    Yes a lot of people are in trouble, but the real problem is reverse leverge farther up the line, where you have a package of a thousand home mortagages and 1% of them are not performing. What is the package worth?

    A percentage of its cash flow? Nope, it is worth what someone will pay for it, which right now is nothing.

    —————————–

    "If the dwelling is the Wrong Size House in the Wrong Location there is no bottom."

    If that was true, everyone would be selling short, so they could buy back the same house for $500, like in Detroit.

    Instead the salient fact remains that we are sellin more homes at lower prices and higher total dollar volume.

    In other words, the market is working.

    RH

  9. Anonymous Avatar
    Anonymous

    Cheer up, EMR. Obama has said that the days of building endles sprawl forever are over.

    We now have a New Urbanist-in-Chief, and a Global Warmest-in-Chief.

    And of course with no economy to pay for all this stuff, we will pay for it by printing money.

    That way it will be “free – no cost” in the immortal words of Jim Bacon.

    RH

  10. Anonymous Avatar
    Anonymous

    The draft version of the Carbon Cap and trade bill was released today.

    It is going to make the mortgage mess seem like water dooler gossip by comparison, because its cost will hit EVERY household, except those without heat, air, or electricity who walk to work.

    Then again, without all that stuff you don’t need to work vey much. We can all paly golf and go fishing.

    RH

  11. Anonymous Avatar
    Anonymous

    Markets do work:

    “One regulatory lesson we can take from Iceland is how to combat overfishing:

    Fishermen…are a lot like American investment bankers. Their overconfidence leads them to impoverish not just themselves but also their fishing grounds. Simply limiting the number of fish caught won’t solve the problem; it will just heighten the competition for the fish and drive down profits. The goal isn’t to get fishermen to overspend on more nets or bigger boats. The goal is to catch the maximum number of fish with minimum effort. To attain it, you need government intervention.

    The solution?

    Iceland Privatized the fish. Each fisherman was assigned a quota, based roughly on his historical catches. …Before each season the scientists at the Marine Research Institute would determine the total number of cod or haddock that could be caught without damaging the long-term health of the fish population; from year to year, the numbers of fish you could catch changed. But your percentage of the annual haul was fixed, and this piece of paper entitled you to it in perpetuity. Even better, if you didn’t want to fish you could sell your quota to someone who did. The quotas thus drifted into the hands of the people to whom they were of the greatest value, the best fishermen, who could extract the fish from the sea with maximum efficiency. You could also take your quota to the bank and borrow against it, and the bank had no trouble assigning a dollar value to your share of the cod pulled, without competition, from the richest cod-fishing grounds on earth. The fish had not only been privatized, they had been securitized.

    Voilà: cap-and-trade for fish — aka “Individual Transferable Quotas” — was born.”

    And Larry thinks my ideas are nuts, Just wait util he gets his cap and trade bill.

    RH

  12. Anonymous Avatar
    Anonymous

    The S&P 500 Index rose 8.5% in March, the best monthly gain since October 2002 .

    RH

  13. Larry G Avatar

    "And Larry thinks my ideas are nuts, Just wait util he gets his cap and trade bill."

    In the case of fish quotas – 100% of nothing is – nothing.

    the problem with fish quotas is that other players get involved – like the rest of the world and everyone then tends to take more than their allocated percentage such the the fish stock end up NOT being maintained but instead go to commercial extinction –

    ergo.. 100% of nothing is nothing.

    when you "equal" percentage allocation yields less and less fish .. eventually your percentage is no longer viable as a way to make a living.

    comparing attempts to manage commercial fish stocks with cap and trade is more foolish than trying to advocate cap & trade for toxics like mercury.

  14. Larry G Avatar

    We are learning a hard lesson (one that has been repeated) on government policies that essentially incentivize homes as investments.

    Take away the mortgage deduction and the market will actually work properly with respect to market demand.

    We got all kinds of blame going around but basically … as government policy – we deemed it a good thing to build more and more homes when there were no more buyers with adequate incomes to buy those homes so we started selling homes to folks with bad credit

    … just so we could keep selling homes …because there were “an important part of the economy”.

    .. we see the fatal flaws associated with making the money “go round and round” with housing…..

    is mortgage interest deduction the standard world-wide or is it a U.S. “feature”?

    It appears that the rest of the world was buying U.S. securities based on U.S. mortgage loans – as opposed to world-wide mortgage loans.

    So the U.S. government policy of repealing the Glass-Steagall Act… allowing mortgage-interest rate deduction – even full write-off for ever-increasing rates on predatory ARMs… created a market where speculating on houses … speculating on the price of houses became a primary means of increasing the value of 401Ks and Pension Plans.

    It was a government-endorsed PONZI Scheme… and

    we ALL got burned – big time.

    our policies actually PROMOTED sprawl because as the value of housing stock in places like NoVa accelerated far beyond what many of it’s workers could afford –

    the stampede for the suburbs ensued… aided and abetted by the ” I can flip this house if I can’t pay for it when my ARM resets” mindset –

    all aided and abetted by Government Policies to encourage people to treat homes as investments.

    coming from the same exact folks who were advocating putting social security funds into the stock market…

    because.. it was a “proven” winner and folks 401Ks were “in the stock market”.

    A Ponzi scheme is a Ponzi scheme EVEN IF the Government endorses it.

    Common sense went out the window…

    and we repeated the same behaviors that caused the 1930’s panic AND the Savings and Loan crises…

    remember that?

    remember JUMBO CDs that were NOT .. FDIC-insured?

    sure ..it was “risky” but it paid big dividends.. until the collapse of the pyramid scheme – of course.

    we are generationally tone-deaf on this issue…

    every generation seems to go right back to policies that virtually guarantee a market collapse.

  15. Anonymous Avatar
    Anonymous

    “Take away the mortgage deduction and the market will actually work properly with respect to market demand.”

    Do you propose taking away interest as a business expense for landlords?

    If so, do you propose taking away interest as a business expense for all businesses?

    Do you really think we should be on an all cash economy?

    RH

  16. Anonymous Avatar
    Anonymous

    "…comparing attempts to manage commercial fish stocks with cap and trade is more foolish than trying to advocate cap & trade for toxics like mercury."

    It is exactly the same as cap and trade. You have a limited resource, and you set up amerket in which the most efficient users (catchers) can afford to pay the most for the permits, and they provide the highest value goods to the market.

    That way the community or th epublic gets the highest benefit at the least cost – given the amount of resource that is available or that we agree to allow availbility for. it doesn;t matter where you setthe cap,the market ensures you get the most value out of whatever is available.

    The only difference with toxics is that the resource is EXTREMELY limited. But we do still have some uses for mercury.

    Anyway, you can hardly argue that it has not worked for fish stocks: how to make the ide work for otherprocesses is a matter of detail, not efficacy.

    RH

  17. Anonymous Avatar
    Anonymous

    ” everyone then tends to take more than their allocated percentage such the the fish stock end up NOT being maintained but instead go to commercial extinction – “

    That’s not how it works. You are assuming that the government doe NOT do its regulaltory job. That we would assing pollution or catch limits, for example, and then not monitor them. (think of a pollution limit as a permit that allows you to “catch” a certain part of the market for whatever you produce.)

    “Each fisherman was assigned a quota, based roughly on his historical catches. …Before each season the scientists at the Marine Research Institute would determine the total number of cod or haddock that could be caught without damaging the long-term health of the fish population; from year to year, the numbers of fish you could catch changed. But your percentage of the annual haul was fixed, and this piece of paper entitled you to it in perpetuity.

    Notice tht the fish quota is NOT set by majority vote, except maybe majorty vote of the MRI. Which is probably selected (according to preset criteria) by people who are appointed by people who are elected.

    And notice that the big fishermen can put the small ones out fo business, but they would need to BUY their permits.

    RH

  18. Anonymous Avatar
    Anonymous

    “…is mortgage interest deduction the standard world-wide or is it a U.S. “feature”?”

    I don;t know about standard world wide, but in Europe it is even bigger than ours.

    RH

  19. Anonymous Avatar
    Anonymous

    “Tax Deductions: The 2004 survey also outlines the key items which can be deducted to reduce taxable income in each country – for example, personal allowances, personal loan interest, mortgage interest, medical insurance, pension contributions, as well as investment and education
    allowances.

    http://www.agn-europe.org/htm/firm/news/ttf/2004/Salary%20Taxes%20Article%202004.pdf

  20. Anonymous Avatar
    Anonymous

    “Current homeowners bought their homes on the expectation not only that they would enjoy tax deductibility, but that they would be able to resell their house at a higher price because of the imputed value of the tax deduction to the next owner. If you remove the deduction, most people will see a permanent decline in the value of their largest asset.

    To a libertarian, this is a valuable cautionary tale: we should assume that any program we introduce will be with us in approximately that form forever, because ending it will harm the beneficiaries. Liberals are understandably unhappy with applying this lesson very broadly. Which is one of the reasons I suspect that the mortgage interest tax deduction will outlive us all.”

    Megan McArtle

    “the Atlantic”

    RH

  21. Anonymous Avatar
    Anonymous

    “Supremes: Environmental Rules Should Weigh Costs, Benefits
    Posted by Keith Johnson

    The Supreme Court ruled today in favor of a power company. That’s not necessarily a bad thing for the environment.

    In a 6-3 decision, the Supreme Court ruled in favor of power companies in Entergy v. EPA and related cases.

    The issue was a rules change in the EPA which sought to make power companies upgrade their plants to protect the environment regardless of cost. The appeal aimed at reinstating Bush-era rules that allowed power companies to do cost-benefit analysis before certain upgrades. As the WSJ explains:

    “We conclude that the EPA permissibly relied on cost-benefit analysis in setting the national performance standards,” Justice Antonin Scalia said in the majority opinion. The majority concluded the costs and benefits could be weighed under a broad set of circumstances.

    Specifically, the court said, using the “best available technology” to tackle any given environmental problem means using the most efficient approach—not necessarily the best technology if it is prohibitively expensive.

    The ruling addresses a huge question in the energy and environment battle raging right now—namely, how to strike the balance between environmental protections and safeguarding the economy.”

    Environmental Capital.

    OK, Larry. NOW will you agree that cost benfit analysis is the law of the land?

    Now will you agree that the majority may NOT necessarily deamand using the best technology if it is prohibitively expensive?

    ——————————-

    And just to tie this to this thread, EMR bases much of his theories on supposed efficiency and the value of the environment.

    Now he has a different standard to meet, if his ideas are ever to dake root. I’ve never had a perticular argument with some of his ideas, other than he totally ignores the costs.

    RH

  22. Larry G Avatar

    quotas don't work very well in real world situations:

    here's a typical end game:

    "Citing scientific data on the depletion of cod stocks, the European Commission had recommended up to a 25-percent cut in catches. Some scientists have said cod numbers will only recover if there is a total ban, but this was rejected by the ministers."

    http://www.eubusiness.com/Fisheries/cod-fishing-quotas.21-12-06

    Here's another:

    "While the theory may sound good, making it a reality is no simple matter. Lipton, Miller and Shabman said the most difficult part of any quota system is trying to decide the initial "fair share" to be allocated to each individual waterman."

    http://www.bayjournal.com/article.cfm?article=3443

    one of the bigger issues is how do you enforce the quotas especially when they change and what used to be a barely profitable catch is reduced such that even if you buy additional quotas … that just makes it even less profitable….

    For Pollution,

    We can do cap and trade for low level pollutants measured in millions of pounds and is not deadly toxic and or persistent in the environment but when you're dealing with much more toxic things measured by the teaspoon (like mercury) it's a dumb deal.

    no legitimate environmental group nor scientific organizations like the National Science Foundation and most state level environmental agencies like this:

    “Although Pennsylvania is a strong proponent of trading and other market mechanisms, allowing such a program for this highly toxic pollutant compromises the integrity of trading and jeopardizes its legitimate use as an effective tool to achieve cost-effective reductions when used in appropriate situations,” Environmental Protection Secretary Kathleen A. McGinty said.

    http://www.depweb.state.pa.us/news/cwp/view.asp?a=3&q=503800

    but none of this keeps the property rights folks from blathering on about an idea that is pretty well acknowledged to be dumb as toast except for the folks who can't seem to understand the difference between low level chronic pollutants and deadly toxics.

    as a result.. the credibility of all of their ideas is suspect.

  23. Larry G Avatar

    Interest deduction is a legitimate business expense.

    Interest deduction for private homes distorts the market and encourages speculation that ultimately leads to a collapse of that market – which is exactly what happened – not once but at least twice.

    Interest deduction is exactly how predatory loans were foisted on the financially unsophisticated.

    They were told that it did not matter when the ARM reset because they’d get to take it all off of their income taxes and …worst case.. sell the house for a profit.

    We have folks talking about sub prime folks who should not have bought the house.

    The data reveals a different story… people buying McMansions, second homes, vacation condos… all based on the premise that they could write off the interest and dump the property for a profit if the payments got too onerous.

    we could not have designed a better system doomed to fail.

    I’m in favor of an interest deduction for the FIRST home that is a primary residence and the deduction is based on not the sales price but an index value for affordability.

    For instance, the home cost 250K but the affordability index was 200.

    you get the deduction for 200K – max – no matter how much more you pay for the house.

    and you don’t get this – if your income is above the qualifying income.

    People say that the collapse was caused by greedy people – like in this case – there were “different” kinds of greedy people.

    NO.. same greedy people.. always looking for ways to make money by gaming the system…

    and in this case the Govt policies were very accommodating…

    a whole industry grew up around the concept of “Flip this House”.

    all of it based on the idea that if you bought a home.. fixed it up.. it would be worth more than the cost of the remodeling by the time you finished the remodeling.

    We had, in effect, Government-sanctioned speculation….with homes and real estate….

    and now the time has come for the folks who had nothing to do with any of it to pay the losses of those who played roulette with their pension funds.

    Anyone who thinks that the Govt had nothing to do with this needs to seriously ask themselves why the “greedy” people only caused a meltdown in this particular industry.

    The mortgage interest deduction .. when applied to ever increasing ARMS – fueled the speculation.

  24. Anonymous Avatar
    Anonymous

    The European Commission had a different experience than Iceland.

    “the most difficult part of any quota system is trying to decide the initial “fair share” to be allocated to each individual waterman.”

    Nobody said it was easy. Anyway, it doesn’t matter very much what the initial allocation is, because they will be bought and sold until a fair allocation is achieved.

    ————————

    “when you’re dealing with much more toxic things measured by the teaspoon (like mercury) it’s a dumb deal.”

    That is your opinion. But if a mercury bulbs prevent more mercury contamination than they cause, why is that a bad deal?

    ——————————-

    “…the folks who can’t seem to understand the difference between low level chronic pollutants and deadly toxics.”

    Oh, I understand the difference, but I’m pretty sure you don’t. That is why your ideas are suspect.

    ——————————–

    “The property rights folks” are also environmentalists, lets not paint people with a single brush.

    —————————-

    If interest deduction for business is a legitimate expense then NOT allowing it for private homes distorts the market in favor of landlords.

    I think of my life as a business and Ithink if it is legitimate for business then it is legitimate for me. I don’t run my life as a loss leader, I expect to make a profit every month. I’m a ole proprietor of my life, I’m just not incorporated and have stockholders.

    I really don’t think your idea has any merit. At all.

    —————————-

    Every thing we do is speculation. you talk about it as if it was a bad thing. You cross the street you speculate you won’t get run over. You buy services from a doctor you speculate he will do you more good than harm.

    You get married you speculate she won’t turn into a witch or a nut-case. You buy a house you hoppe it goes up in value, not down. You speculate the county will let you put on an addition if you need one.

    You put the tools out there and you give everyone an equal shot at using them. Just becasue someone cuts his ankle with a chain saw doesn’t mean I don’t need one and shouldn’t have it.

    —————————-

    Your mistake is that you think every penny the government spends is YOUR money and you should have a say in it. You should either pick one thing commensurate with what you have sent the government, like one tank track, and complain about that. Then stop worrying. Or else complain about everything proportionate to the one micromillscrump your share amounts too.

    You’ll be a lot happier and less grumpy.

    ————————-

    I accept tha fact that not every quota will work. That doesn’t mean it is a rotten system that should be thrown out. I accept the fact we made horrible chemical mistakes, that doesn’t mean we should all be chomophobes. I accept the fact that some people abuse mortgage deductions and others abuse drugs.

    I accept the fact that virtually everything we do has tradeoffs and risks, that every move is a speculation.

    When I’m sailing I can point higher and go a shorter distance slower, or reach off a little, and go farther but faster and more comfortable. Either way I’m speculating on a wind shift, andmaking my own cost benefit analysis.

    And now the Supreme Court agrees with me.

    Cost benefit analysis got a bad name in environmental circles because it was presumed to be code for “no.” The debate flared up earlier this year when cost-benefit proponent Cass Sunstein was named the Obama administration’s “regulation czar”

    Sunstein has said “When ordinary people disagree with experts, it is often because ordinary people are confused.”

    Many environmental advocates accuse CBA of being a rigged methodology that always seems to favor doing less for public health and the environment.

    Even if that is true, even if it IS rigged, that bias will become evident over time, and it can be adjusted. Whereas if we have only the environmentalists intuition for our cost benefit analysis (and that is what it is, after all) we will have no methodology to search for improvements.

    And probably no money fro anything other than cleanups.

    —————————-

    “Interest deduction is exactly how predatory loans were foisted on the financially unsophisticated.”

    Oh come on, predatory loans were foisted by predators on weakling prey. This is like saying air is how eagles are foisted on mice.

    The mortgage interest deduction did notcause our problems by itself, and there is no reason to sacrifice ourselves along with this hapless scapegoat.

    Does it have problems? Yes. Is it regressive? yes. Is that a problem? Maybe. can it be improved? Yes. Is the only way to improve it to eliminate it and cause a bunch of OTHER problems?

    No.

    The simple answer is almost certain to be wrong.

    ————————–

    “I’m in favor of an interest deduction for the FIRST home that is a primary residence and the deduction is based on not the sales price but an index value for affordability.”

    I’m in favor of pollution controls based on an index for affordability. I’m glad to see we agree.

    The best index value for affordability is the market.

    Unfortunately we have not progressed far enough in the definition of property rights that we can tax banks for their toxic pollution like we do other manufacturors. It is all a matter of defining property rights for externalities, and then enforcing them.

    —————————

    “…and now the time has come for the folks who had nothing to do with any of it to pay the losses of those who played roulette with their pension funds.”

    We could sit back and do nothing. It will work itself out eventually. Some people think just paying the losses is cheaper, even if we had nothing to do with it.

    It is like settling a lawsuit, when you are completely innocent. You don’t have to settle, but if you don’t ——-you are speculating on the result.

    RH

  25. Anonymous Avatar
    Anonymous

    If you don;t think cost enefit analysis or cap and trade (which is a practical application of CBA) have any environmental application then check out

    http://www.envirovaluation.org/

    “Environmental Valuation and Cost Benefit News”

    ————————

    Recent Headlines.

    Environment Provides Florida Huge Economic Benefits: Report shows fishing and hunting alone accounted for $8 billion impact in 2006

    Keeping the Amazon Forests Standing: A matter of values

    Greening Your Truck Fleet: Technology, Tools, and Techniques

    Study Finds National Standard for Energy Efficiency Can Save U.S. Consumers and Business Nearly $170 Billion:

    Experts: Time is right to rekindle wood energy in America: Study says small-scale power plants could be a source of clean, affordable energy

    Thermal-economic modeling and optimization of vertical ground-coupled heat pump

    Etc. Etc.

    I happen to think they have a certain bias. That ther nubers are optimistic, mistated, and sometimes wrong.

    That’s OK though, at least they are arguing with numbers which can be corrected rather than feelings or opinions which cannot.

    RH

  26. Larry G Avatar

    re: "That is your opinion. But if a mercury bulbs prevent more mercury contamination than they cause, why is that a bad deal? "

    this question reveals more about the dumb as toast aspect of understanding important information.

    Mercury light bulbs are not all broken and then the contents incinerated and spread across the skies to then fall onto land and water in concentrations high enough to cause serious damage to both critters and humans.

    the vast majority of dead mercury light bulbs do not break and are essentially sequestered in landfills.

    and they've studied which of the two generates more mercury and the bulbs save more than the extra electricity generates for incandescents.

    you claim to be an environmentalist with academic credentials and yet you cannot understand this very simple difference between spewing thousands of tons of mercury across the skys to then deposit in rivers and streams verses sequestering the substance – which is what is done to most toxics now days.

    They are either permanently sequestered and/or re-processed into less toxic substances.

    Mercury can actually be re-processed into less dangerous substances also but if you are burning it and spreading it across the landscape – recovering it to reprocess is not practical.

    Not all pollutants are created equal.

    some are low level but if released in large quantities can become chronic… and eventually lead to longer term issues – like acid rain and GHG.

    Other pollutants are deadly and no amount running loose in the environment is acceptable much less cockamamie ideas that it can be "spread around" with cap & trade policies.

    There are thousands of pollutants where cap & trade would be a disaster…

    yes.. you. the guy who claims to be an environmentalist with academic credentials to boot – are 180 degrees on this issue with most credible academics and practicing professionals.

    because.. you are so committed to the idea of property rights that you cannot maintain even a rudimentary judgment with respect to toxics that virtually all scientists are totally opposed to their release.

    You are wrong guy. Plain and Simple. The only folks who agree with you on this are the whackos and no one with any sense or responsibility in the government or environmental groups or academia supports what they advocate.

  27. Larry G Avatar

    “I think of my life as a business and Ithink if it is legitimate for business then it is legitimate for me. I don’t run my life as a loss leader, I expect to make a profit every month. I’m a ole proprietor of my life, I’m just not incorporated and have stockholders.”

    there is a difference between a house one needs for shelter and engaging in the buying and selling of houses (or land or virtually anything) as a way to make a profit.

    The purpose behind interest deduction is to allow businesses to be able to write off their expenses so that their “profit” is a true measure of productivity.

    You think you run a business but the IRS has a standard for whether or not you really are a business or not and fundamentally.. you cannot just write off expenses because you claim to be a business.

    You have to demonstrate that you really are a business that really does qualify to write off expenses – by making a profit and also showing that you are actually in business.

    Otherwise, Ray, we’d all make the same claim that you are and all of us would be writing off anything we spend on food and shelter as an “expense”.

    Private homes are not businesses and should not have their interest written off and more than we allow private autos to have their interest written off.

    It’s the same concept.

  28. Larry G Avatar

    re: "http://www.envirovaluation.org"

    it's good to read other points of view.

    but there is a ton of evidence, a body of knowledge from the larger scientific community about the fact that some toxics are very, very harmful when released into the environment and the goal is to reduce and restrict them not "dilute" them by spreading them around.

    this is as they say settled science.

    the debate as to whether or not we want them in the environment is over.

    we've already done that cost-benefit and the answer for some substances is essentially absolutely, positively NO.

    cost/benefit tradeoffs are certainly a legitimate approach to making decisions but we've done the cost-benefit on toxics and we already know that the short-term benefits are way, way less than the long-term costs.

    If we can find the technological means to implement a cost-effective way to remove mercury from coal-combustion, it will happen.

    It might even make electricity cost more – but the goal is to do less and less releases and eventually get to the point where releases are no longer causing harm to critters and people..

    JUST LIKE WE DID by outlawing the release of substances that kill EAGLES and OTHER critters and humans… especially fetuses and pregnant women.

    Some folks who also happen to do blogs and claim to be environmentalists and trained academicians blithely ignore the body of evidence and rather stupidly and ignorantly continue to show really bad judgment…

    while the rest of the legitimate scientific and environmental community have reached consensus on many of these issues and they are settled and the verdict is that toxics are not appropriate for cap and trade policies.

    In fact, we require all polluters of toxics to keep an inventory and every year we document, in pounds, how many toxics are released and every year ..we try to find ways to make those numbers go down further.

    The folks you read.. apparently it does not make any difference to them whether a pollutant is deadly or not.. they treat them all the same… all are candidates for cap & trade.

    It would be one thing if THEIR list of toxics was DIFFERENT than others but that in the end they agreed that some toxics are just too dangerous to be released at all.. much less cap & trade ..

    but the debate was over which toxics were too deadly and which were not..

    but these folks Ray.. they don't have a list of which ones are too deadly…to compare to the government list.. and then debate why some toxics are "over classified".

    these folks don't seem to discriminate on this basis at all…

    every toxic is apparently a candidate for cap & trade.

    right?

  29. Anonymous Avatar
    Anonymous

    On Greenwashing.

    Who CAN you trust?

    “after canvassing a dozen competing groups hawking so-called “green certification” services — including one online outfit that awarded him an instant green diploma, no questions asked — he grew disillusioned about how meaningful any endorsement would be to his customers.

    Michael Witte”If you want green certification bad enough, you can get it,” says Mr. Owsley, owner of Cleanpro USA LLC, a Scottsdale, Ariz., company that franchises carpet and upholstery cleaning businesses. “I joke and say, ‘I could buy some of these companies a case of beer, and they’d give us a certification.’ I’m very frustrated by that.”

    As green marketing has proliferated, so has the number of “eco-labels” competing to be the environmental equivalent of a Good Housekeeping seal of approval.”

    RH

  30. Anonymous Avatar
    Anonymous

    “re: “http://www.envirovaluation.org”

    it’s good to read other points of view.”

    I don’t understand, did you look at that site? It is full of examples of cost benefit analyses that SUPPORT environmental initiatives.

    I don’t see how the reaminde of your comments follow.

    RH

  31. Anonymous Avatar
    Anonymous

    “we’ve already done that cost-benefit and the answer for some substances is essentially absolutely, positively NO.”

    Actually, no we haven’t. There are people working today with incredibly dangersous stuff – because there is a need for the end product.

    The common example is mercury fluorescent bulbs. are we going to do away with the use of mercury, or not?

    How about glyphosphates?

    Pthalate Esters?

    RH

  32. Anonymous Avatar
    Anonymous

    “Mercury light bulbs are not all broken and then the contents incinerated and spread across the skies to then fall onto land and water in concentrations high enough to cause serious damage to both critters and humans.

    the vast majority of dead mercury light bulbs do not break and are essentially sequestered in landfills.

    and they’ve studied which of the two generates more mercury and the bulbs save more than the extra electricity generates for incandescents.”

    Sounds like a cost benefit analysis to me.

    “you claim to be an environmentalist with academic credentials and yet you cannot understand this very simple difference”

    It is only different in degree, otherwise the process is the same.

    You are putting words in my mouth about spewing thousands of tons.

    But the amount don’t make any difference, it is the relative costs and benefits that count. Naturally the costs are related to the amount, so don’t claim I’m saying things I never said.

    I know it sounds stupid, but if you cold put a price on the entire world and you found out that the cost of preventing its loss was six times its value, would you still do it?

    Could you? Where would you raise the money?

    RH

  33. Anonymous Avatar
    Anonymous

    “Mercury can actually be re-processed into less dangerous substances “

    Mercury is an element. Unless you go after it with nulcear physics it will always be Mercury. You can combine it wilth something else, but it is still Mercury. It might be less dangerous, or more dangerous, as in fulminate of mercury or the compound they yse in executions.

    If we think we get rid of something by sequestering it, then why is Yucca flats such a problem?

    You keep thinking I am on “the other side” somehow, and I am not. But what I do know is that we make big mistakes by not being realistic about what is possible and what isn’t posible first of all, and then aomong the things that are posssible, discerning among what is desirable and what is affordable.

    Then, if you can figure out how to get the bigest part of the most desirbale tasks sccomplished for the amount you can afford, you still have to figure out how to accomplish these things equitably.

    But the people who think we can just make Mercury go away, don;t see things that way,and as a result we will get a lot less done, get it done later, and cause more problems in the process.

    I’m not on the other side, I’m out in front. What I want to see done is a lot better job than what we are doing. People who THINK they are already working the problem are upset by anything that doesn;t match their agenda.

    It is only that the process for the kinds of improvement I want to see is so foreign to you that you ccan’t see it leads anywhee valuable.

    You just figure I’m a moron or a nut case instead of a leader or visionary. I’m convinced that the policies you support get less done, less valuable stuff done, and get it done less equitably.

    Although the green goal is similar, I’m not willing to support your agenda because I think it is inefficient and unethical.

    ——————————

    In today’s news there was an article about the uproar over Madonna adopting a second African child. Some people (who apparently don’t have enough else to do) are arguing that it is wrong for her to adopt in Africa when there are millions of American children in foster care.

    Apparently they value one orphan more than another.

    And yet if you ask them to put a value on human life, many of them would say you cannot do it.

    If it costs $10,000 to adopt an African orphan and $35,000 to adopt an American orphan (who is probbly already getting better care than his African counterpart), then where would you spend your money? how do you save the most children for the money you have?

    And those are the same problems we need to resolve in working with the environment, the economy, and our social obligations.

    The math makes some people uncomfortable: they would prefer to believe what they believe, rather than open their eyes and think.

    RH

  34. Anonymous Avatar
    Anonymous

    "every toxic is apparently a candidate for cap & trade."

    Not every toxic. Sometimes it isn't worth doing, but that's what cost benefit decides: whether there is som euse for ricin or dioxin or DDT or Arachlor that is valuable enough to permit some uses.

    ——————————–

    "In fact, we require all polluters of toxics to keep an inventory and every year we document, in pounds, how many toxics are released and every year ..we try to find ways to make those numbers go down further."

    Why bother? By your argument and your philosophy we could just shut them down, go to zero pollution, and stop worrying about it.

    Why go through the annual charade?

    RH

  35. Anonymous Avatar
    Anonymous

    “If we can find the technological means to implement a cost-effective way to remove mercury from coal-combustion, it will happen.”

    So you are agreeing with the supreme court (and me) that if it isn’t cost effective, then it doesn’t have to happen?

    RH

  36. Anonymous Avatar
    Anonymous

    “there is a difference between a house one needs for shelter and engaging in the buying and selling of houses (or land or virtually anything) as a way to make a profit.”

    Yeah, if you are in it for a profit thenit is a business, and the difference is that you think it is OK to deduct interest for a business.

    ??????

    How about ana rgument that does not go in circles.

    You want to subsidze business by letting them deduct interest, but you don’t like profit???

    That anti-profit thing is SOOO sixties.

    RH

  37. Anonymous Avatar
    Anonymous

    ” especially fetuses and pregnant women.”

    You mean like Thalidomide which was terribly badly used with awful results, but which still has other valuable uses today?

    RH

  38. Groveton Avatar
    Groveton

    Fishing bans …

    When I was in high school I often went fishing in the Chesapeake Bay. We caught a lot of rockfish (striped bass to people outside of Maryland).

    When I was in college I often went fishing in the Chesapeake Bay. We caught fewer and fewer rockfish.

    After I graduated I often went fishing in the Chesapeake Bay. We almost never caught a rockfish.

    One day fishing for rockfish was banned. Since I hadn’t caught one in years I didn’t sweat the ban too much. But every time I’d pull up to the ramp a nice fish and game guy would check my live well and coolers for rockfish. Since I never caught any he didn’t find any (I would have thrown them back if I did catch one).

    Eventually the ban was lifted.

    In recent years I have gone fishing on the Chesapeake Bay quite often. We catch rockfish all the time. In fact, we usually “limit out” in a couple hours of fishing.

    So, why don’t quotas work?

  39. Anonymous Avatar
    Anonymous

    Rockfish breed someplace else. The ban worked, but it wasn’t immediately apparent.

    RH

    —————————-

    “The fishing market has excess capacity. Distributing quotas makes the barely-profitable sell their quotas and leave the industry, using capital elsewhere. It’s a more efficient allocation of society’s resources.”

    Carlos Ferreaira

    —————————

    “That’s exactly the point of ITQs: it’s not only your catch that’s being limited here, it’s everyone’s. Right now, everyone fishes up to the point where every fisherman is barely profitable. No one makes any significant profits. Under ITQs, everyone who gets quotas is essentially guaranteed a larger profit than before without the system in place.”

    “…that is a difficult decision. But just keep this in mind: who gets the quotas matters for equity — who gets rich and who doesn’t. It doesn’t matter for efficiency — making the overall system run well and achieve the environmental goals.”

    Gernot Wagner

    ——————————-

    I posted Larry’s comment on a differnt blog to see if I could get answers different from mine that he might accept.

    I think the overall point is that the market does work, and we CAN learn to make it work for environmental goodness.

    First you have to accept that the governments job is to protect property, and that profits are a good thing.

    RH

  40. Larry G Avatar

    Groveton… the quotas that are most at issue are commercial fishing…

    here an example:

    http://www.eubusiness.com/Fisheries/cod-fishing-quotas.21-12-06

    but if you GOOGLE the phrase "commercial extinction" fish quotas… or similar you'll get the gist of the issue.

    here's another
    http://www.newsreview.com/sacramento/content?oid=932244

    they are starting to look into allocating "shares" as a way to keep from over-fishing a species and driving it to commercial extinction – like has been done with several species already

    and now species like the Bluefin Tuna are at risk.

    Of course commercial extinction is an interesting phrase.

    There will probably always be Bluefin Tuna in the ocean but perhaps not enough to make it worthwhile to send a factor ship after a school of them.

    and here's the specific concern:

    " Several cod stocks collapsed in the 1990s (declined by >95% of maximum historical biomass) and have failed to recover even with the cessation of fishing."

    there is quite a bit that we do not know when judging how much we can harvest and how much we need to leave to be "sustainable"…

    we really have no clue how many "shares" we should be allocating for a given species.

    they usually start out with what is been harvested historically and go from there.

    but you've have to have a worldwide clearing house for such allocations and many nations don't even recognize such international bodies in the first place.

    So.. we're allocating to the ones that …participate.. while the others… don't bother to buy shares at all.

    What Ray talks about is "in theory"… but most of the folks in the dialog are very skeptical that it can actually work unless we can get the entire world to essentially agree to one body being in charge of essentially deciding how many shares to allocate and what the cost is… etc…

    In the end… a cynic might say that "commercial extinction" is how we "save" the species because at that point..that's when the factory ships go looking for something else to catch.

  41. Larry G Avatar

    re cost-benefits, toxics, cap & trade

    My problem here is that the advocates of using cap & trade don't lay down a list of what they think are good candidates for cap & trade and what are not.

    For instance, some of them want mercury.. because it's a central issue with coal power generation but these same folks are mute on the hundreds/thousands of substances that the EPA classifies as toxics and has said that cap & trade for these substances is dumb as toast – in the appropriate government – speak.

    The Cap & Trader advocates don't have a list of what are good and what are not good candidates…

    they're basically advocating cap & trade as a better way to allocate "property rights"..

    that's their basic Schick.

    they could care less if we end up with more mercury in our stream and water bodies…. for the most part and you know this…because they don't have a number that they say is safe and that number is a different one from what the EPA says is safe.

    From the point of view.. you do the cap & trade first then figure out what the "appropriate" safe value is – later.

  42. Anonymous Avatar
    Anonymous

    Larry, the fact is that fish rights are working in Alaska and Iceland. One reasonthey work is that you can take yur catch whenwver it suits you and whenever the market is best.

    Under total limits everyone raced out to get theirs before the season closed and all rushed it to market at once.

    Pollution rights are bought and sold under the clean air act and under the European system. A new system is planned for US CO2 permits as well.

    None of this is hypothetical.

    There is only one question. If these are truly “our” resources, how do we get our share of the profits? If Larr doesn’t want his share, he doesn’t have to sell.

    On the other hand, just like Tim deChristopher, he cannot lay claim to rights he hasn’t got the money for.

    RH

  43. Anonymous Avatar
    Anonymous

    “they could care less if we end up with more mercury in our stream and water bodies…. “

    That simply isn’t true. What is true is that some mercury will wind up there, and people who profit from mercury should pay the full external costs. If it is our environment, who should they pay?
    Who should they buy the rights from?

    As you point out, we can always reduce the allocation, but that makes the remaining rights all the more valuable.

    —————————-

    Consider this thought experiment.

    Mercury fluorescents reduce the electricity used and therefore the cost of lighting. Lighting then has more value and we use MORE of it (Jevons Paradox). This increases the overall use of electricity even though each bulb uses less. There is no limit on where this goes.

    Under a cap and trade plan for Mercury, there is a limit. The bulb manufacturors would have to buy mercury rights from the power companies, reducing the amount of coal available to burn. Fopr whatever amount of mercury is allowed, whatever the cap is set at, yuget the most efficient allocation of uses, and there is a limit as to how much is released.

    Despite your claims, I think I’m as green as you, but I insist on efficiency and fairness as well. When I start hearing that message frome Sierra and EDF and PEC, they will get a new contributor. Until then, not a dime.

    RH

  44. Anonymous Avatar
    Anonymous

    “because they don’t have a number that they say is safe and that number is a different one from what the EPA says is safe.”

    Nonsense, I’ll take a number the EPA is safe, as long as they follow their own rules such that no one is advantaged or disadvantaged, as long as the supreme court ruling on cost benefit analysis is followed, and as long as we agree to pay for property taken for public use.

    My message has nothing to do with how much we pollute. it only says that we get the most bang for out pollution prevention buck – the cleanest environment for the least money – if we don’t waste it on gold plated standards based mostly on some political agenda.

    At the same time, we have the most money to spend on these efforts if we don;t wreck the economy in the cleanup process:: if we don;t consider profits as if they were toxic assets.

    RH

  45. Anonymous Avatar
    Anonymous

    the “appropriate” safe value is – later.

    This SOUNDS terribly crass, but there is no way around it. The “appropriate” safe value is the one that doesn’t cost you more than the lives you save are worth.

    That is what safety is all about. If it costs you $35,000 to save a life with one policy when you could have saved a life with another policy that costs only $10,000 per life then you are not only a thief, you are a murderer.

    And how would you ever know, unless you agree to look?

    That is what cost benefit analysis is all about. That $10,000 life you could have saved – those three and a half lives you could have saved for the $35,000 youspent on something else – are the most intimate personal property you can own. THAT is why we need to protect property rights: because they are equivalent to lives, and if we don;t protect lives we have, as Abe said, anarchy.

    RH

  46. Anonymous Avatar
    Anonymous

    “but you’ve have to have a worldwide clearing house for such allocations and many nations don’t even recognize such international bodies “

    If you don’t recognize the law, thenyou son;t have to recognize property rights, do you?

    Gives you some idea of how far we have to go. When you have Greenpeace out there physically defending what they think is their property from others who think they have a right to take it, and the government won’t step in.

    Where was Greenpeace when I needed them?

    RH

  47. Anonymous Avatar
    Anonymous

    “but most of the folks in the dialog are very skeptical that it can actually work unless we can get the entire world to essentially agree to one body being in charge “

    What else is new?

    When you have a global issue,you need global agreement, or you get global war. Now there’s an environmental disaster we can avoid, but it doesn’t seem to be on anyones cost benefit analysis.

    RH

  48. Larry G Avatar

    the "share" idea only works if you take into account ALL catches whether they are participants in the share system or not.

    If you don't do that..then the share system is totally bogus and will not accomplish what it promises.

    the folks in favor of the share system …favor do that.. and pretending that the "catch" that they are sharing is only what they themselves are catching.

    this is a fundamentally flawed approach… another one of those "in theory" ideas that has real-world issues.

    Many of the people who advocate it do not care one whit about the implications of possible commercial extinction… they're only after "their share"… their "property rights"

    they don't give a rats behind about what ultimately happens to the fish stocks.

    it's the same exact deal with cap & trade.

    There is no dialog at all from the folks who advocate cap & trading toxics about what is the safe amount to be releasing overall in the first place.

    what they are after is agreement to pollute first ..then figure out the "details" later.

    The EPA and most credible environmental folks think we should talk about the impacts of toxics on the environment.. and what is a safe level FIRST and most of them do not support putting toxics where they are not right now.

    they're opposed to the idea that there is any safe level at all for some toxics and that our goal is to reduce and restrict their release and look for methods to keep them from being released at all.

    …as we have successfully done already with many toxics…

    the dumb as toast folks ..they believe that all toxics are created equal and that they are not any more deadly that things like acid rain…

    so.. if cap & trade "worked" for acid rain.. in their minds.. it ought to work for "cap and trade".

    Nevermind that the entire scientific and environmental community agrees that there is no safe level for some toxics – period.. that doesn't stop the dumb-as-toast folks.. who often attempt to cloak themselves as also being "green" much like the major polluters do PR AD campaigns to convince the public that they are "green".

    the bottom line is that the folks who favor cap & trading of toxics don't care about the toxics at all.. they are after "property rights"… i.e. the "right to pollute"…

    Ray..you are on the wrong side of this.

    you are not "green" at all if you favor policies that ultimately will cause MORE harm to the environment from pollution.

    We have proven over the last 50 years that we CAN REDUCE pollution.. that we do not have to pollute some substances especially deadly and persistent ones.. for us to have modern lives.

    Characterizing the issue by saying that we have no choice but to pollute …. any and all things no matter how deadly is dumb as toast…and definitely no "green" ….

  49. Anonymous Avatar
    Anonymous

    this is a fundamentally flawed approach…

    How can you say that it is fundamentally flawed, when it has been proven to work in several instances and loctions?

    There are also other approaches, where you ahve a fish reserve: no fishing atall ins a certain area. then when the fish reserve becomes overpoplated the escess fish spill out into areas where they can be fished.

    Now you have a known steady supply, and you can issue quotas to be used outside the reserve.

    But the real issue is, how do you manage limited resources?

    Suppose you had an island people that subsisted on fish, and a few people own the licenses. When the populationcan no longer be supported by the fish stocks, will those with fish licenses sit and watch others starve?

    The othersa re going to fight them for the fish. Will the government protect their property rights in the licenses? Will the majority of people still insist on fish protectiona and a good fish habitat?

    RH

  50. Anonymous Avatar
    Anonymous

    “The ToxInt database has been produced by the World Bank’s Economics of Industrial Pollution research team, in collaboration with the Center for Economic Studies of the U.S. Census Bureau. The dataset provides pollution intensities and the corresponding toxic risks for 246 chemicals in the U.S. EPA’s Toxic Release Inventory (TRI).

    The following variables are provided:

    the chemical name,
    a standardized chemical identifier called the Chemical Abstract Service (CAS) number (denoted in the tables as NCAS),
    4-digit ISIC codes,
    pollution intensities for air, land and water by employment (E), value of output (T) and value added (V), and
    Threshold Limit Values (TLV’s).

    The units of measurement for employees are kilograms per 1,000 employees, and for value of output and value added, the units are kilograms per 1987 $US million.”

    —————————

    “Characterizing the issue by saying that we have no choice but to pollute …”

    Lets be clear about this. There is nothing you can do that does not result in waste. Enough waste in one location amounts to pollution, or will result in pollution.

    We can decide not to pollute in one location or industry by shutting it down, but we cannot do that for free. It will have a cost.

    That is why the toxint database includes data on how much the industrial output which depends on the release of toxic cheicals is worth.

    Theoretically you could prevent all “pollution” deefined in a certan way. We could go back to being hunter gatherers, taking no more than the ecosystem could provide. Our own waste would be so widely scattered as to be not much of an issue.

    The question is whether it would be worth the cost. Under that licfestyle a lot of people would die or die early. How many people are we willing to let die in order to make our environment “safe”.

    You can make fun of this becasue it is an extreme example, but sooner or later we are going to make some hard choices, and they will be based on some kind of cost evaluation.

    The choice we have is to make it an ethical and honest eveluation, or just another excuse to steal.

    RH

    RH

  51. Anonymous Avatar
    Anonymous

    “you are not “green” at all if you favor policies that ultimately will cause MORE harm to the environment from pollution.”

    Even when you get to the point that preventing harm to the environment causes more harm to people?

    Isn;’t the whole point to make the environment “safe”?

    RH

  52. Anonymous Avatar
    Anonymous

    Dead Zones: Do More Biofuels Mean More Dead Fish?

    To hit the 2015 ethanol mandate, a lot of land currently set aside in conservation programs and other land used for soybean cultivation would need to be converted to corn. Growing all that corn means more fertilizer, which will feed into the Mississippi River and end up in the Gulf of Mexico”

    Which is it going to be? Cleaner atmosphere or more dead zones? which would you rather do, breathe or eat fish?

    Sounds like a cost benefit analysis to me.

    How would you decide, Larry, have a vote?

    RH

  53. Anonymous Avatar
    Anonymous

    “The WSJ has a nice article on the turmoil among environmental groups in deciding on a cohesive strategy to address climate change. Basically it comes down to “Do we become advocates of a particular solution, or do we become economists?”

    Nothing underscores the green movement’s soul-searching more than its conflicted view of coal, which provides about half the world’s electricity. Should society pour billions of dollars into trying to perfect a way to turn coal into electricity without emitting greenhouse gases? Or should it reject coal as inalterably dirty and try to replace it entirely with renewable sources like the wind and sun?

    …Rather than push certain technological fixes, critics say, environmentalists should simply push government to slap industry with a tough cap on greenhouse gases — and let industry figure out how to meet the mandate.

    I’m sure it will shock no one that I like the latter. Who better to figure out how to reduce emissions at least cost then those who will bear the costs? And it looks like some environmental groups are coming around to the same view:

    “It’s like we’re pushing to invent a better cotton gin as a way to reduce slaveholding instead of just banning slaveholding,” says the Environmental Defense Fund’s John DeCicco. “

    ——————————

    Hey Larry, keep sending that money to EDF.

    When they come around, I’ll send them some, too.

    RH

    H

  54. Larry G Avatar

    where is the list of pollutants that the cap & trade folks think are acceptable and appropriate for cap & trade?

    re: folks starving for lack of exercising quotas and shares..

    they'll starve anyhow after the fish stocks collapse…

    but of course … no one does… they fish one kind of fish until it no longer can sustain it's stocks.. then they move on to the next species to fish that one into the ground.

    name the fish stocks that are currently successfully operating under your "share" system and how long have they been operating?

  55. Anonymous Avatar
    Anonymous

    “In fisheries, the biological goal is to set allowable catches so that the harvest is not so large that it endangers the future health of the fish stock while it is not so low as to waste food, while the economic goal is to maximize the net economic rent generated by the fishery.”

    You can’t have one without the other. Too few fish, not enough caught, not eneough fish income. To many fish uncausght, not enough fish income.

    There is only one answer that maximises BOTH the (useful) fish and the fish income. That answer requires that you not have too few fish. It guarantees the best protection for the fish AND the fishermen.

    RH

    RH

  56. Anonymous Avatar
    Anonymous

    Acceptable and appropriate haven’t got anything to do with it or else those issues are coveed inthe CBA.

    It’s acceptable if the benefit is more than the damage. You might still be so damage averse that the requirement is the benefit has to be a LOT more then the damage (damage limit is set very low).

    Yu can, of course CHOOSE to set the damage limit to zero, but then yo ge no benefit, and you can be pretty sure it will cost you more than a very low level of damage and at least some benefit.

    RH

  57. Anonymous Avatar
    Anonymous

    The Icelandic quoata system started in 1984. Initially fisherment disagreed with the system. What changed their view of support for the system was the ability to exchanbge quotas: to treat them like property rights.

    this system protects the fish stocks through total allowable catch and it allows the fisherment the most efficient and profitable business, given the catch allowble.

    The system was so successful that it led to a boom in Icelandic banking, and we know how that worked out. The banks are gone but the fishermen are still working.

    RH

  58. Anonymous Avatar
    Anonymous

    In 1991 a survey found that 95% of icelanders felt thzt the fish were the common property of the nation: they objected to the boat owners profiting from quotas granted to them by the government, free of charge.

    Even one fishrman said ” If it is efficient to steal from one and sell to another, then I reject such economic policy…I just will not do that to the common property of the nation.”

    Nuff said.

    RH

  59. Larry G Avatar

    “‘Shares’ in fish stocks halt commercial free-for-all”

    http://www.newscientist.com/article/dn14762-guaranteed-fish-quotas-halt-commercial-freeforall.html?feedId=online-news_rss20|

    several other sources confirm… so I’ll buy it – for now. there is still a problem with those countries that will not participate.

    The only realistic way to deal with this problem – you are forced to look at the entire fish stock and to look at the total demand on those stocks that come from BOTH – ITQ participants AND the rest of the world that is not interested in participating in the ITQ program.

    and that would be especially true of species that range worldwide – like the bluefin tuna that …IIRC.. Japan does not quota sharing…and they are among the largest consumers of blue fin tuna – in fact, an almost insatiable appetite to the point where ONE TUNA can bring thousands of dollars at auction.

  60. Larry G Avatar

    not all pollutants have the same levels of damage.

    EPA classifies them comprehensively and uses that data to formulate their policies about what can be release (or not) and in what quantities … and whether or not they control at the point of discharge or they allow cap & trade…

    all of this based on the assessment of the potential harm of a given pollutant.

    So.. it is in the opinion of EPA scientists – based on data and criteria what they think is acceptable and appropriate.

    There is plenty of room for disagreement but the burden of those who disagree is to show WHERE they disagree..

    SPECIFICS … where they would name the chemicals that they think COULD be appropriate and acceptable based on THEIR criteria.

    It's totally bogus to assert that cap & trade ought to be expanded to some undefined level on such flimsy concepts of "you can't stop damage".

    this is what destroys the credibility of those who advocate.

    if they were truly serious about this.. at the least – they would go find 2 or 3 really good examples to prove that the EPA is too conservative… do the data.. prove the point.. and then once you've won that one.. you can move on to more.

    what they're doing is not this.

    they've essentially got an open advocacy for "more"… really dumb as toast …just as bad as the anti folks who say "less" without quantifying how….

    but that's to be expected.. because they are not really interested in the harm that could be done… they're too busy focusing on their "rights" but as I said.. if they were truly interested.. they'd actually make some real cases… to prove their point – and they don't.

  61. Anonymous Avatar
    Anonymous

    “there is still a problem with those countries that will not participate.”

    Yes, it is called stealing. They want more of waht the environment provides than they are entitled to, or are willing to pay for.

    RH

  62. Anonymous Avatar
    Anonymous

    "not all pollutants have the same levels of damage.

    EPA classifies them comprehensively and uses that data to formulate their policies about what can be release (or not) and in what quantities … and whether or not they control at the point of discharge or they allow cap & trade…

    all of this based on the assessment of the potential harm of a given pollutant."

    Almost right Larry, you may get there yet.

    EPA is REQUIRED to consider costs and benefits. They consider the potential harm, the ability to asimmilate the harm locally, and the financial benefits tht occur as a result.

    EPA scientists are EPA scientists after all, and they have their own bias. That is a good thing and it is part of what gives us a reasonable margin of error.

    But they are not free to simply dismiss out of hand data just because of where it comes from. We like to think that the burden of proof is on the polluters, because they are the "bad guys".

    It is conveneient for us to think tht way, because we want to be the good guys, and because we want to think we don't have to pay for pollution, or lack therof.

    In reality, the burden of proof is on the regulators: they have to prove that their regulations are best for everyone, without giving either burden or benefit unfairly.

    RH

  63. Anonymous Avatar
    Anonymous

    “for “more”… really dumb as toast …just as bad as the anti folks who say “less” without quantifying how….”

    Precisely. Now you have got it. One is exactly as bad as the other.

    Pushing in only one direction will ALWAYS lead to a bad result.

    RH

  64. Anonymous Avatar
    Anonymous

    “several other sources confirm… so I’ll buy it – for now.”

    I agree there are a lot of details to work out. That is part of what I mean when I say we need More property rights and more property protection.

    Otherwise, the theory at least is sound.

    Now substitute excess fish taking for excess pollutant pushing, and you get the same answer.

    You still beleive that the (possibility of) catastrophic fish collapse or catastrophic environmental damage justifies ANY expense to prevent.

    It doesn’t. It only justifies and expense equalt to the amount of the catastrophe. We are not going to expend a nuclear war to preent Tonga from overfishing.

    The benefit doesn’t justify the cost.

    RH

  65. Larry G Avatar

    “In reality, the burden of proof is on the regulators: they have to prove that their regulations are best for everyone, without giving either burden or benefit unfairly.”

    and that’s what they do.

    they do exactly that.

    anyone can claim they don’t but it’s totally bogus if they don’t substantiate their claim.

  66. Larry G Avatar

    "Pushing in only one direction will ALWAYS lead to a bad result."

    BOTH SIDES are pushing Ray.

    the property rights folks are pushing just as hard to loosen the rules…

    and they don't have anything substantive to back up why they want to loosen the regs other than they say it's because they have "property rights" and that in your words.. the EPA is "stealing" their rights by not letting them pollute using their criteria.. of which they don't have one standard they all agree to… they all just want the rules to go away so they can exercise their property rights.

    I've never seen from you or the sources you cite what toxics you think are appropriate for cap & trade… only that it's the best way …apparently no matter how deadly the toxics.

    Not one have I see a list of substances that you say are good candidates or a list of substances that you think are bad candidates because they are too deadly.

    so which is it?

  67. Larry G Avatar

    “Otherwise, the theory at least is sound.”

    that’s another bullfeathers for you guy.

    the theory is not “sound” if it cannot be effective in practical real-world scenarios.

    and that’s the fundamental dumb-as-toast approach that you’re advocating.

    there is a reason why more than a few theories end up with a verdict of ” so far the theory has not been shown to be practical”.

  68. Anonymous Avatar
    Anonymous

    ” without giving either burden or benefit unfairly.”

    and that’s what they do.

    they do exactly that.”

    But, according to you, they have the right not to, correct?

    RH

  69. Anonymous Avatar
    Anonymous

    “the theory is not “sound” if it cannot be effective in practical real-world scenarios.”

    It works for the fishing industry in Iceland, New Zealand, and Alaska.

    It works for the 448 largest polluters regulated by the clean air act.

    What part of real world would you like, aside from the parts you want to protect?

    RH

  70. Anonymous Avatar
    Anonymous

    "Pushing in only one direction will ALWAYS lead to a bad result."

    BOTH SIDES are pushing Ray."

    Precisely. And that is the problem.

    Both sides are pushing to gain an advantage for their side: which amounts to stealing from the other side. If either side succeeds, it amounts to stealing from the other side. And there is NO brake on the system to tell one side when they have succeeded, too much.

    I attended a meeting once, hosted by a representative from the Virginia Open Land Foundation. She opened with a glowing history of how much land VOLF had preserved and what their programs and plans were. Whe Q&A time came around I asked her when they panned to stop, when they thought they would have enough land preserved.

    You would have thought I had slapped her in the face. It had simply never occurred to her that they might have enough, some day. It never occured to her that someone ought to be thinking about how much might be too much, or what the triggers would be.

    No one (other than me) is advocating for a method to find the best solution for all. We like to think that informed advocacy amounts to the same thing, loyal opposition, and all that. We like to think that an adversarial relationship yields the most competitive results.

    But what history suggests is that what we get instead are wild pendulum swings, driven by the current powers that be.

    In sailing or flying or ship handling we call it oversteering, and it is recognized as a huge waste of energy.

    RH

  71. Anonymous Avatar
    Anonymous

    “and that’s what they do.

    they do exactly that.”

    If you beleive that, that they are working for the best for everyone, then why not just let them do their job? Why do we need advocacies pushing them to do their job more to “our” liking?

    What reason can there be, except then we think we can get some advantage, that we can get something for nothing?

    That we can use the rules to steal from the other guy?

    RH

  72. Anonymous Avatar
    Anonymous

    “that you’re advocating.”

    You still think I’m advocating for the other side, just because I’m not advocating for your side.

    Because I’m seeking equal environmental justice, equal environmental costs, and equal environmental usage.

    I’m offended by people who try to use property rights arguments to their own advantage, over and above others. (Which is my primary objection to YOUR position.)

    I’m offended by people who try to hold the high moral ground, for their own advantage.

    I’m offended by people who claim to be working for the public benefit but refuse to recognize pareto efficiency.

    I’m offended by people who refuse to put themselves in the other guys shoes.

    And I’m offended by people who are not willing to put a fair measuring stick to their beliefs.

    I beleive that, given the situation at hand, there is only one best answer. One that provides the maximum economic support for the people of the planet, least environmental cost.

    Whatever your other advocies are, if you are NOT looking for that answer, then you must be planning ontaking advantage of someone, and you are not my friend.

    I also beleive that we could achive different “best answers” members of a family of best answers, if you will, provided we are willing to change the conditions at hand.

    THAT is when things get subjective. Given the situation and facts at hand, very little is really subjective, though we like to think so. We like to think so because sorting things out objectively is tedious, messy, and difficult.

    So yes, we can try to reduce greenhouse gasses by 70% by 2030. History suggests we might have better success and more experience ithe process if we just try to reduce the population 70% by 2030.

    But in order to do that you would have to make some very subjective decisions.

    RH

  73. Larry G Avatar

    be offended.. you’re entitled.

    most folks are not trying to “steal”.

    they are legitimately concerned with huge potential mistakes being made – like we have repeatedly made in the past in deciding what are “safe” decisions with regard to pollution.

    to impune their motives is not very intelligent IMHO when clearly their concern is not to have an even more damaged environment with even more serous consequences for the living things in those environments.

    Ray – you have no clue what the word “objective” means. It’s just your own idea of what you think is correct and it refuses to acknowledge that if others disagree with you that they could be “objective” also.

    you refuse to answer the hip question and there is a good reason why – because you know that there is no hard and fast way to determine cost/benefit.

    there is no dollar cost assigned to the benefit of having an artificial hip that might give one 10 or 20 more years of physical mobility as opposed to walking with a cane or being in a chair.

    and that’s the choices we have to make with pollution.

    how much is a child’s loss of IQ worth?

    what is the cost of damaged DNA in a pregnant woman?

    How much is it worth to have entire species of birds – like Eagles wiped out – forever?

    to you and your “property rights” friends, these things are mere details that make the concept of C/B unnecessarily more complex that your simple-minded scenarios – because at the end of the day – it’s not about the consequences of the pollution at all – it’s about what your perceive to be as inalienable rights – to pollute and to make money from polluting.

    That’s not environmentalism at all. That’s just plain ordinary greed and stupidity.

  74. Anonymous Avatar
    Anonymous

    most folks are not trying to “steal”.

    Actually, they are. They just don’t realize that agitating for or advocating for a position that is not optimal is exactly equivalent to stealing. It is setting up a market that does not operate on a level playing field.

    Not accounting for the costs of pollution results in an unequal playing field. So does over accounting for the costs of pollution, but some people refuse to rcognize that side of the situation.

    Isn’t tstealing exactly why you are so adamantly opposed to subsidies? Because you think they ALWAYS equvalent to stealing from the person who pays for a service but doesn’t use it?

    RH

  75. Anonymous Avatar
    Anonymous

    “to you and your “property rights” friends,”

    I don’t have any “property rights friends”

    They all mistakenly assign me to the eco nazi caolumn, thinking I favor environmental rights over property rights. that I want to redefine property in favor of the greens.

    RH

  76. Anonymous Avatar
    Anonymous

    “That’s just plain ordinary greed and stupidity.”

    That must be why CBA is required by law in the US.

    It will be required in the new energy bill, too.

    RH

  77. Anonymous Avatar
    Anonymous

    “how much is a child’s loss of IQ worth?

    what is the cost of damaged DNA in a pregnant woman?

    How much is it worth to have entire species of birds – like Eagles wiped out – forever?”

    —————–

    I don’t know. That isn’t my job. But there are ways to figure it out, and the answer is not infinity, as your questions imply.

    RH

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