JIMMY CARTER, DESMOND TUTU ET AL OPPOSE KEYSTONE XL PROJECT – IS IT CASE OF SENILITY OR EFFECT OF SOME KIND OF CRAVING AND/OR MAMMON?

The Keystone XL pipeline project approval circus is getting more farcical with former US president Jimmy Carter weighing on this project. Carter joined some Nobel Laureates– Archbishop Desmond Tutu is one of them – in issuing an open letter to US President and Secretary of State seeking rejection of the pipeline.

Carter and the other writers have expressed their opposition in quite vehement terms; among other things saying that “Keystone XL project is the linchpin for tar sands expansion and the increased pollution that will follow, triggering more climate upheaval with impacts felt around the world.”

Let’s try to understand what these folks are trying to say. So, they are saying that this one pipeline – Keystone XL – which is supposed to transport 830,000 barrels of bitumen per day, will cause so much pollution that it will trigger climate upheaval with impact felt around the world?!!! Really?!!! Can anyone in right frame of mind make such a ludicrous, nonsensical, irrational statement?

Then why did Carter and others allowed their names to be used for such a ludicrous, nonsensical, irrational assertion? Seriously, why?

Is it senility or something else that has afflicted them? After all, one assumes that Carter et al should have this much of commonsense to realize that just one pipeline carrying less than a million barrels of crude per day which is just about one percent of current crude oil production worldwide cannot by any stretch of rational sense ‘trigger climate upheaval’. It is flat out nonsense. Yet, these so-called intellectuals have affixed their name to such gargantuan irrational, foolish statement.

Of all the persons whose names are listed in the open letter, Carter should know best the enormous advantage US stands to gain through STRATEGIC partnership with Canada of which Keystone is a major component. Advantage of being energy giants! Imagine the scenario wherein US and Canada can stand together as stable, dependable energy superpowers with massive amount of oil and gas at their disposal for export to the world in today’s global uncertainty – uncertainty in gas and oil supply from regions in Europe, Middle East, Africa. But Carter overlooks all this! Why?

Do the people who have written this letter really believe that by killing one pipeline they will make any meaningful impact in regard to the so-called pollution problem? If they do, they are dumb-asses. If these people had raised their voice against global use of fossil fuel that would have still made some sense at least. It is a different discussion though the theory propounded by some scientists, that the so-called CO₂ generated from combustion of crude oil is responsible for ‘climate change’, is total balderdash and piffle.

In the letter there is another assertion that is completely dubious. This is regarding the so-called impacts on First Nations of Northern Alberta – apparently their water, air, land and human rights are being ‘devastated’ by growth of oil sands. It appears that this kind of statement is drafted by someone who has no clue of the reality prevailing in Northern Alberta. Nothing but some sensational stuff meant to stir emotions of those unfamiliar with the ground realities!!

So, coming back to the question: what made these people to jump on this Keystone XL bandwagon? Do they also want to be included in the post-scripts of climate change ‘crusade’? Or, maybe they want to have their names included in the list of knights in shining armor who saved the world from some ‘climate change apocalypse’? On this point of climate change it must be mentioned that unfortunately the world is currently in the grip of a massive hoax predicated on climate change – a hoax similar to what history saw in Galileo’s time when people thought sun goes around earth.

So, if it’s true that the above cited letter writers are unable to control their inner cravings to have their names included in a so-called climate change crusade, well, then that can be said to be stemming from senility (or some psychological disorder) in some way or the other.  It is sad that these people failed to realize that campaigning against just one pipeline is totally meaningless – killing one pipeline will not make any dent whatsoever. If they had to really achieve anything substantive, they could have raised their voice against something on global scale, say, against all heavy oil – be it from Saudi Arabia or Venezuela or US or China, not just against Canadian heavy oil.

So, now the pressure is on President Obama. On one hand former president Clinton, Warren Buffet et al have reportedly supported Keystone XL pipeline apart from host of current Democrat Senators. As well, a former National Security Advisor of US testified before Senate recently that Keystone is INDEED in the national interests of US, rejection of Keystone would be playing in the hands of Putin.

People may be reminded that, unfortunately, Obama was ‘framed’ by the shrewd Europeans in his early days of presidency by very cleverly putting the albatross of Nobel Peace Prize around his neck. And, now Obama is continually getting crushed under its weight in the context of leaving behind a legacy.

Will Obama buckle down under the weight of misplaced phantom notion of legacy and reject the pipeline or think of larger long term interests of United States and approve the project? Perhaps Obama would care to remember that one of the signs of a person’s greatness and statesmanship is to subordinate one’s own hankering after greatness to the greater good of the people and the world. What greatness material is Obama made of?

DOES AMERICAN FREE MARKET CONCEPT MEAN PROFIT BY HOOK OR CROOK, AND NO RESPONSIBILITY TOWARDS THE WORK FORCE?

Through this blog I want to raise a conceptual discussion amongst economists of all stripes as to how the markets should run or be made to run. Why can this world not have an economic model which is more inclusive of the frailties of human nature? The motive for this conceptual discussion came from reading Berkshire Hathaway Inc’s annual report of 2008, and an article on Bloomberg.

Warrant Buffet is one of the richest persons on this planet, and his perspective on money matters has always been very insightful. His narrative in Berkshire’s annual report is always a treat for its readers – its report for 2008 was no exception. But then, what has Oracle of Omaha’s document got to do with the heading of this blog? Plead read on, you will see the connection.

Let me quote Buffet from page 11 of the report which deals with home mortgages: “At that time (Y2008?, italics added), much of the industry employed sales practices that were atrocious. Writing about the period somewhat later, I described it as involving 'borrowers who shouldn’t have borrowed being financed by lenders who shouldn’t have lent'”.

He further states on same page: “To begin with, the need for meaningful down payments was frequently ignored. Sometimes fakery was involved……..The resulting mortgages were usually packaged (“securitized”) and sold by Wall Street firms to unsuspecting investors. This chain of folly had to end badly, and it did.”

Wait! What the hell was going on in the United States – lenders happily making out loans that borrowers couldn’t repay out of their incomes?! And, Wall Street selling mortgages to unsuspecting investors?! Is this what free market is supposed to be – that any organisation can do anything to rack up huge profits, at least in the short-term, and the top executives can fill their pockets with millions of ill-gotten bonuses?

Is free market concept supposed to have no oversight on the diabolical and self-serving CEOs who may be going berserk in the market tearing down ethics and honesty to shreds? Is this what economist Milton Friedman’s concept of free markets was or is? Is Friedman feeling happy in his grave watching what unbridled greed of human nature has done to the world?

Did it never occur to the ‘great’ Friedman that free market concept should also bequeath on the top executives (of organisations which deal with tonnes of money) some kind of responsibility towards the millions of people working in hundreds of thousands of organisations which could directly or indirectly get potentially exposed to risks and losses due to the shenanigans of the people who run the said (financial) organisations?!!

Today millions and millions of people have lost jobs because of an imploding market around the globe caused by the shameless, villainous ‘confidence tricksters’ of United States (and some of their ilk in Europe) who funnelled hundreds of billions of dollars in a housing bubble. Do these immoral wicked rotten executives of the mortgage lending companies and the various banks realise the pain, the tears and the suffering of the millions – the shattered dreams, disrupted future, lost opportunities of those hapless people?

Why did the policy makers in US in different periods of 1900s not pay heed to the sane concept of another top economist – James Tobin? It seems Tobin’s experience of the depression as a teenager in the 1930s gave him a lifelong loathing of unemployment.

The Bloomberg article, referred to above, writes: “As a young professor I did a paper where I analyzed the optimal unemployment rate,” said Joseph Stiglitz, a professor at Columbia University in New York, who knew Tobin at Yale. “Tobin went livid over the idea. To him the optimal unemployment rate was zero.”

The article mentions at another place: “Like Keynes, Tobin was an advocate for the role of government in maintaining full employment, said James Galbraith, an economist at the University of Texas in Austin. The current economic and financial crisis has validated that philosophy, said Galbraith, a former Tobin student and the son of the late John Kenneth Galbraith, who was a friend of Tobin.”

“It’s clear that the position that the federal government has a responsibility for the level of employment, for the economy, has prevailed,” Galbraith said. “The position that the Fed can walk away from the level of employment has completely collapsed….”

My question is: why couldn’t Friedman’s and Tobin’s ideas be married and a governing economic model more inclusive of the frailties of human nature be developed and implemented – in US and other economies? Has the current economic crisis not demonstrated that any economic model ignoring the role of frailties of human nature is incomplete and flawed, if I may?

The issue is not whether Friedman is great or Tobin is greater. The issue is there got to be a economic model that is practical in nature, and not one which is predicated on idealistic premises – idealistic premises, like, humans will always act responsibly, humans will never succumb to greed, self-aggrandisement etc.

Tobin (Nobel Prize winner in 1981) in an essay written for the Nobel committee mentioned, “The miserable failures of capitalist economies in the Great Depression were root causes of worldwide social and political disasters.” Economics “offered the hope, as it still does, that improved understanding could better the lot of mankind.”

Tobin’s friend and colleague William Brainard says, “He (Tobin) believed financial markets could serve a valuable service in diversifying risk and moving capital in efficient ways.” “But he was not someone who believed the market always got it right and that private incentives were always aligned with the public good.”

Almost a clairvoyant, Tobin seems to be now in hindsight. But what he said and believed in appears to be more prescriptive and applicable for the ways we humans behave. We must keep in mind that this world is still not made up of people like Mr. Spock of Star Trek who was paragon of logical mind.

After this massive economic bloodletting can we now decide to mend our thinking and redefine the way the markets ought to run so that people don't lose jobs again at such a massive scale? Or, will we again relapse in complacency once we are out of this horrible downturn?

Mistakes teach us to learn from it so that we don’t repeat them. Ideology of any political party or of an individual should not be allowed to cloud the objectivity of human thinking. The greater good of the society is supreme and should be so. Let the political leaders of the present realise this and lay the foundation for the future.