Archive for the ‘economics’ Category

The Cost of Living

May 12, 2008

Up around my neck of the woods, there is a huge debate going on as to whether a nickel mine should be allowed to open. The land that sits on top of the nickel deposit belongs to the State of Michigan. The mining company, Kennecott Minerals, argues that there is money to be made. The opponents argue that the cost to the environment will be higher than the financial payout. It really is as simple as that.

Now everyone knows that the non-sentient entity known as “Kennecott Minerals” doesn’t care about the environment. Like an earthworm, it’s only concern is to continue feeding so that it may continue living. If an earthworm found out that it’s poop was toxic to the soil that it lived in, it would simple keep moving forward, leaving the poop comfortably behind; it will keep doing this until there is no more ‘forward’ and it must do this right up until its own toxic poop kills it. It has no other alternative.

The question of whether Kennecott should be allowed to open a nickel mine on the Yellow Dog Plains is a pretty simple equation: will we end up paying more for it than what we get out of it? Kennecott is very invested in convincing the State and the locals that the payoff will be significant and the costs negligible.

The other two speakers in this debate are the locals and the State of Michigan.

Like a corporation, the State of Michigan is also a non-sentient entity. But instead of requiring profits for its survival, it requires reelection. I concede that there are officials who will make a stand for what they believe is right against public majority opinion, but for the most part, party officials will not throw their support behind a cause that is unsupported by their constituency.

Which leads to the locals, the people who will be left to live in Kennecott’s poop trail. There are several reasons why the locals are comfortable with the notion to open a new nickel mine on the Yellow Dog Plains.

Organisms strive toward life. First and foremost, living things must take in nutrients, dispose of waste, and breed new life. This truism flows from the cellular level on up through the whole organism. Because of this, an organism will become toxic to itself if it must do so to live. An example of this is the disease phenylketonuria, or PKU. Some newborn infants are born with a defective enzyme. The infants are unable to correctly metabolize the amino acid phenylalanine, an amino acid in breast milk. When these infants are nursed at their mother’s breast, their bodies cannot convert the phenylalanine into tyrosine. Toxic levels of phenylalanine cause severe mental retardation. But the baby has no choice; it must eat to live, even if eating causes causes her system to become toxic. Severe retardation is still life, and the organism always strives towards life.

In the same way, many locals are convinced that the immediate financial payoff of jobs that will provide sustenance to themselves and their families is more essential than the eventual toxicity of their environment. This is mining country, and the people here are used to having to acclimate to toxicity in order to live.

And besides, the poop pile is over there. Since most people live a significant distance from over there, they are more comfortable with making that place toxic. It’s a shame, but folks gotta make a living.

Finally, Kennecott has spent a lot of time and money convincing the locals that the damage won’t be any more significant than what they’ve known all their lives, and the payoff is worth a little sacrifice.

In the meantime, the people who actually live on the Yellow Dog Watershed are going absolutely apeshit. They are being betrayed by their neighbors, and they are angry, hurt and horrified. Because they are a small group of people with limited assets, there is a good chance that they will not be able to convince their neighbors that the payoff will not be worth the sacrifice.

Deciding whether sacrifice is worth averting probable future pain requires a level of sentience. I’m curious of what a sentient community would look like. I wonder how “American” it would be; We The People are so invested in individual rights that we forget that we live communally in our environment. There really is no over there.

I think that it’d be a good idea to move toward sentience. Does our society really need this nickel mine? Does our community really need these jobs? Is the toxicity worth it?

I believe that sacrifice now might better insure life for our grandchildren. That is my answer. Perhaps you have a different answer. I would be willing to debate the question.

Currently, the decision process includes applications to the DNR and EPA. The DNR is holding a hearing in Lansing, Michigan as this post is being written on whether it is legal, by the laws of Michigan, for Kennecott Mine to open.

The hearing is being conducted before Richard A. Patterson, an administrative law judge with the state Office of Administrative Hearings and Rules. It involves two permits — one for building and operating the mine, and the other for groundwater discharge. Patterson could uphold the DEQ’s ruling or recommend that it be rejected. The final decision would be made by DEQ Director Steven Chester, who already has endorsed his staff’s recommendation to approve the mine. Entire Associated Press Article

Most of the locals think that the hearing is about whether the mine will be safe enough; what the hearing is actually about is “a challenge filed by the National Wildlife Federation, the Huron Mountain Club, the Yellow Dog Watershed Preserve and the Keweenaw Bay Indian Community. They contend the DEQ wrongly concluded that Kennecott’s plan meets environmental protection standards set under a state nonferrous mining law enacted in 2004.”

I think that we, as a society and as a species still think of this planet as one of limitless resources. There is no end to the air in the sky and the sea is vast beyond our imagining. But, like the people of the Easter Islands, our resources are finite. And like the Easter Islanders, our choices may spell out disaster.

Or maybe we are canny enough, intelligent enough, and sentient enough to ask the right questions, to find the answers that point down a path toward survival. This new path will take courage and belief in our fellow humans. It will take hope. It will be frustratingly difficult. But working toward solution is the only really interesting option.

West Antarctic Ice Sheet and Ocean Upwelling

March 10, 2008

Science writer Marc Airhart writes in Geology: “The new IPCC reports on climate change had essentially sidestepped the issue of Antarctica’s potential contribution to sea level rise. The authors pointed out, rightly, that there was just too much uncertainty to make predictions.”

So what’s going on with study of the West Antarctic Ice Sheet? The new theory has to do with ocean upwelling.

“Antarctica is encircled by atmospheric currents that largely insulate it from the rest of Earth’s climate and keep it colder than it otherwise would be,” Airhart writes. These air currents push water away from the continent. “As surface water is pushed away, warm deep water rises to replace it.” The stronger the air currents, the more the upwelling. It looks like what is happening is that as the world climate warms, these air currents become stronger and there is more upwelling.

This is the hypothesis. There isn’t enough observational data to validate this hypothesis yet.

However, it has been observed that the antarctic glaciers aren’t melting from the top, they’re melting from underneath.  If the West Antarctic Ice Sheet lost it’s “plug”, the Thwaits Glacier, the rest of the WAIS might follow.

 NASA’s Dr. Jim Hansen predicts a 5 meter (16 1/2 feet) rise in sea level by the end of this century.  Back in 1991, the EPA estimated the cost of a one meter rise in sea level would be around $250-$500 billion dollars.  But the fact that this rise will  be happening everywhere all at once, in the midst of an economic recession … really, I have no idea of what the fallout of something like that would be.  It will be a disaster, but a disaster in slow-motion. 

The Economics of Climate Change

March 5, 2008

The Story of Stuff got me thinking more about the economy. Anyone who knows me is probably boggling, because I’m not someone you’d call a financial whiz kid; give me rocket science any day.

My friend Stef Maruch commented:
The entire premise of capitalism is based on ever-increasing levels of production and spending. It’s a Ponzi scheme.Companies with kazillions of customers, like eBay, are considered to be “weak” if they don’t add MORE kazillions of customers.  Now, increasing production and spending don’t have to involve using up more physical resources…as the people making money on Second Life can attest…but generally they do.

TimesOnline reported (13 Dec ’07):
European leaders and environmental campaigners reacted angrily yesterday after the United States rejected guidelines for reducing greenhouse gas emissions intended to check global warming….

The negotiations were given urgency by the publication last month of a report by the Inter-governmental Panel on Climate Change (IPCC), which gave warning of irreversible catastrophe caused by global warming if greenhouse emissions are not rapidly reduced….

(The IPCC) concluded that it was possible to limit average temperature rises to 2.4C by the middle of the century, but only if carbon emissions peak by 2015 and then start to decline. It calculated that, in order to achieve this, industrialised countries should reduce their greenhouse emissions by between 25 and 40 per cent compared with 1990 levels by 2020 – this is the figure which the EU wishes to see in this week’s document.

All of this has got me thinking about the economy. I can see a couple of different senarios:

1) “Global warming” is a bunch of hogwash; sure we might warm a couple of degrees, but this talk of the dire effects of global warming is irresponsibly alarmist. Though it is too bad about the polar bears.

2) There will be an amazing scientific answer to the problem which will pull our nuts from the fire, and we will be able to engineer our environment to suit our needs.

3) Global warming will happen gradually, with most of the effects being felt in the poles and tropics. We’ll have a different world, but we’ll be able to adapt.

4) “The Shit Will Hit The Fan

Most people believe #3. So I started thinking — what if senario three is what will really happen?

First, the third world would be the first to suffer from the effects of global warming. There will be changes in climate that will effect the food and water supply, as well as increased severe weather events. The scientific community is pretty straight-forward about this prediction.

Much of the world’s manufacturing takes place in the third world. As the third world infrastructure degrades and its populations suffer from lack of food, shelter and heath services, their economies will most likely crash. I think that there will be bottlenecks in manufacturing and costs will increase dramatically.

Secondly, as we see the world change, I think that there will be more and more focus on consuming less. This is already happening, though nowhere near to what it needs to be to decrease emissions to the level that is needed to avert senario four.

What both of these things point to is a slow down in the economy. Since the US is already heading into a rather significant recession, I wonder if it will have the resiliency to avoid a serious economic crash.

Statistics show that “American consumers owed a grand total of $1.9773 trillion in October 2003, according to the latest statistics on consumer credit from the Federal Reserve. That’s about $18,654 per household, a figure that doesnt include mortgage debt. The number is up more than 41% from the $1.3999 trillion consumers owed in 1998.” (MSN Money)

An economic slow down means that more and more people will be out of work — we might be able to feed and shelter ourselves, but we won’t be able to pay our outstanding debts.  This will greatly aggravate the depression, throwing more and more businesses into failure. 

People who have spent their lives saving for their retirement will lose everything.  And this will hit us at the height of the elderly baby-boomer population.

We are spending like there is no tomorrow. We are using up our world like there is no tomorrow.