We recently received a very thoughtful letter from Ted Trainer, an Australian ecological socialist (author of Abandon Affluence! andSaving the Environment) who teaches at the University of New South Wales, asking us about the “surplus problem” and its relation to borrowing in the present economic crisis. We wrote a short reply with our answers. — Eds.
Dear Monthly Review,
I have written and taught from a radical left perspective for a long time and am especially concerned with the significance of the “surplus problem” in explaining core elements in the global situation. However, I am not clear about how best to analyze its significance in relation to the global financial crisis. A recent MR article was helpful, pointing again to the importance of debt in keeping the capitalist economy going. Here is my confusion; I hope you can briefly point me in the right direction.
Obviously the system’s core problem is to find profitable investment outlets for the ever-accumulating surplus. Obviously ever-increasing levels of debt have been crucial in enabling the spending that keeps the factories in operation. But the naïve question is: If there is so much surplus, why is there any need for borrowing? Don’t the corporations have too much capital to place, i.e., a problem of surplus...if so, why do they need to borrow?
Presumably the answer is in terms of the debt and borrowing being the means whereby that surplus is put into (hopefully) profitable use. That is, when they lend “recklessly,” the banks are actually placing the surplus in what they hope will be profitable ventures. Is that it?
— Ted Trainer
Dear Ted,
The problem that you pose here can only be answered by distinguishing between what economists call the “real economy,” associated directly with GDP, and the speculative or financial economy, connected to the bidding up of asset prices or paper claims to wealth. (Alternatively, we can refer to the productive base and the financial superstructure.) If the massive borrowing were primarily in order to finance investment in production (the real economy) you would be entirely right in saying that, with the existence of large corporate surpluses — both actual and potential — such borrowing would be unnecessary.
However, in our view, the chief contradiction of accumulation at present is a shortage of profitable investment outlets within production — a problem endemic to the mature, monopolistic economy. (See “Monopoly-Finance Capital and the Paradox of Accumulation,”Monthly Review, October 2009.) Investment-seeking surplus that is unable to find sufficient profitable investment outlets translates into losses in the (real) economy as a whole and hence a slowdown of growth. Corporations and capitalists seek to hold onto and increase their money capital in these circumstances by shifting the surplus at their disposal into speculation in asset prices. The result is a dramatic expansion of FIRE (finance, insurance, and real estate) and the entire financial superstructure of the capitalist economy. The plethora of money capital entering finance creates added opportunities for speculative growth, which banks and other financial institutions accommodate through new financial innovations (today taking the form of such exotic instruments as collateralized debt obligations, credit default swaps, structured investment vehicles, etc.). Various “wealth effects” (whereby increases in asset prices translate into increased consumption and investment) partially compensate for stagnation and temporarily stimulate the real economy, without, however, materially altering the underlying conditions.
Insofar as the financial system is growing not by servicing production, but through a process of money simply begetting more money (in Marx’s shorthand M-M′), without the intervening production of commodities, this takes the form of a financial bubble, or an unsustainable explosion of credit/debt. This means that the speculative process depends for its very continuation on the piling up of greater and greater amounts of debt, and in order to do this, it needs to have constant cash infusions from the real economy to provide additional capital that can be “leveraged up.” Marx, in his day, had already pointed to leveraging of 10:1 (debt to capital ratio) associated with the Crédit Mobilier, the prototype of today’s giant banks, founded in France in 1852. In the most recent financial bubble, major banks often leverage at a rate of 30:1. Financial profits in these circumstances expand rapidly. Non-financial corporations too come to rely more on debt leveraging and create their own financial subsidiaries to take advantage of the bubble. But insofar as the underlying system remains stagnant, the bubble eventually bursts — typically after a speculative mania in which the rapid rise in quantity of debt leads to a marked decline in its quality. The result is a return to the underlying crisis conditions and real world repercussions.
Right now we are being told that the system has once again found its footing — that finance and even production are recovering. But since the stagnation-financialization trap remains operative, we have no doubt that what we are seeing right now is merely a brief pause — if that — in the developing structural crisis of global monopoly-finance capital. The problems of the system are only getting bigger. — Eds.
A bolsa portuguesa fechou no vermelho, arrastada pelos títulos das energéticas e da banca, num dia marcado por novos receios sobre o incumprimento da dívida do Dubai.
O PSI 20 cedeu 1,34% para 8.253,96 pontos, com 19 títulos negativos, protagonizando o pior desempenho entre os principais índices europeus.
Na base do pessimismo vivido nos mercados europeus estiveram as incertezas em torno da dívida da Dubai World. Nem mesmo as notícias de que os Emirados Árabes Unidos garantem a dívida do Dubai aliviaram as preocupações dos investidores.
O Governo do Dubai anunciou na semana passada ter pedido uma moratória de seis meses aos credores da ‘holding' estatal, para poder cumprir com os pagamentos necessários.
Em Lisboa, a Galp destacou-se pelas piores razões. A petrolífera perdeu 2,32% para 12,01 euros, num dia em que o banco suíço UBS cortou o seu preço-alvo para o papel, passando dos anteriores 13 euros por acção para os actuais 12 euros. Esta é a terceira queda consecutiva da empresa comandada por Manuel Ferreira de Oliveira
Ainda na energia, a EDP cedeu 0,78% para 3,05 euros, enquanto a Renováveis avançou 0,85%, impedindo um cenário mais negro em Lisboa. A energética liderada por Ana Maria Fernandes foi, aliás, a única cotada do PSI 20 a registar ganhos.
As acções da banca também penalizaram a bolsa nacional, com o BCP a desvalorizar 2,33%, a maior queda no índice de referência. O BPI cedeu, por seu turno, 1,95% para 2,21 euros. Já BES deslizou 1,85%. O banco comandado por Ricardo Salgado anunciou na passada sexta-feira a compra de uma participação de 40% no Banco de Amã, na Líbia. Em reacção, os analistas do CaixaBI afirmaram hoje que esperam que o BES continue a expandir-se para novos mercados, embora com investimentos reduzidos.
Também a Brisa e a Jerónimo Martins contribuíram paras o fecho negativo da bolsa, com quedas de 1,9% e 2,16%, respectivamente.
Nota ainda para a Portugal Telecom, que perdeu 0,59% para 8,05 euros. O Diário Económico avançou hoje que o Brasil é, cada vez mais, a grande aposta de crescimento para a operadora nacional. Zeinal Bava afirmou que o Brasil é fundamental para que a empresa possa cumprir a meta de facturar mais de 66% fora de Portugal.
Mafalda Aguilar
Pedro Soares, intervenção na Assembleia da República
Segundo o presidente do Grupo Parlamentar do PS, Francisco Assis, estamos a viver uma emergência nacional, porventura uma perturbação constitucional, certamente um atentado insidioso: estará em curso a tentativa de "decapitação" do governo.
Se há conspiração, é preciso desvendá-la. Se há conspiradores, vamos ter de os apontar. Se a democracia sofre a emergência, temos de a erguer.
Tudo começou com a declaração de um dos ministros mais importantes do núcleo político do governo: foi Vieira da Silva quem veio revelar a existência de uma "pura espionagem política", a propósito de uma investigação judicial em curso sobre a relação do Estado com uma rede tentacular de corrupção.
O que Vieira da Silva assim afirma, e aqui está a conspiração para a "decapitação" do governo que logo Francisco Assis vem confirmar, é que a investigação judicial a empresários e a empresas, incluindo algumas tuteladas por si, é "pura espionagem política". Espionagem, repete logo outro ministro, Santos Silva, chegando mesmo ao ponto de garantir que "durante vários meses, o primeiro-ministro foi objecto de escutas ilegais".
Há então espionagem. Contra quem? Contra o primeiro-ministro, porque algumas conversas telefónicas com um banqueiro e ex-ministro socialista foram escutadas no âmbito da investigação a esta personalidade.
E quem fez a espionagem? Obviamente, o Ministério Público e o juiz de Aveiro que validou o procedimento das escutas.
E houve queixa contra a espionagem? Os ministros indignados com a perfídia da conspiração acorreram à Justiça para pedir investigação contra esta ignomínia?
Nada. Nem um gesto, nem uma queixa, nem uma acção. Fica então a convicção de que temos ministros pirómanos que não hesitam em lançar a confusão na Justiça quando entendem que daí podem retirar dividendos políticos, mas nada lhes interessa do dever da Justiça.
Procuravam decapitar o governo com esta conspiração traiçoeira? Vieira da Silva, Santos Silva e Francisco Assis já o quiseram demonstrar. Porém, as provas demonstram que os conspiradores, que eram magistrados no exercício das suas funções, mantiveram em reserva escutas durante cinco meses, até estas serem legalmente anuladas por instâncias superiores da Justiça.
O jogo da "pura espionagem política" é um jogo perigoso, mas conhecido. Um governo sem rumo tem encontrado na sistemática vitimização o refúgio para a sua própria incapacidade política.
A fuga em frente do governo neste episódio burlesco só tem como explicação a percepção pela opinião pública de que o Primeiro-ministro foi económico com a verdade em questões importantes. É hoje evidente, e o primeiro-ministro confirmou-o agora oficiosamente, que o Governo tinha conhecimento prévio da tentativa de aquisição da MediaCapital pela PT, que ele negou no parlamento. Do mesmo modo que utilizou a força económica do aparelho de Estado para tentar condicionar linhas editoriais na comunicação social que não goza da simpatia governamental.
Uma empresa pública, a Refer, "perdoou" uma dívida a uma empresa de Manuel Godinho, não hesitando em deitar ao lixo 164 mil euros porque, tendo três anos para o fazer, nunca apresentou queixa e deixou prescrever todos os prazos judiciais.
Uma empresa tutelada pelo ministro da Economia, a REN, faz vários ajustes directos com uma rede tentacular no epicentro de uma das maiores investigações judiciais sobre corrupção.
No meio de um país economicamente parado, socialmente injusto e onde crescem as evidências sobre uma rede clientelar que se apropriou indevidamente de património público para seu benefício próprio, como se compreende que as preocupações dos ministros sejam conspirações mirabolantes?
A resposta tem que ir ao essencial: à luta contra a corrupção, à defesa da transparência e à luta pela democracia na economia. Dentro de uma semana esse debate estará no Parlamento, com propostas do Bloco.
Só nos primeiros nove meses do ano, a verba que corresponde ao saldo entre os valores aplicados e retirados destes veículos foi de 2,8 mil milhões de euros. Desde o início da divulgação deste indicador em 1996, cerca de 16 mil milhões de euros já saíram de Portugal para contas em offshore, um valor superior ao que foi investido em países como a Alemanha e a Espanha. Os investimentos em paraísos fiscais já correspondem a cerca de 10% do investimento total deste ano.
Segundo o Fundo Monetário Internacional, as ilhas Caimão têm sido o principal destino escolhido pelos portugueses, inclusive do próprio estado português, que até o final de 2007 mantinha no território britânico 87 milhões de dólares. Na compilação divulgada pelo Banco de Portugal não é possível determinar a fonte institucional - empresas, famílias, estado, etc - e nem qual o destino específico, visto que os investimentos em offshore não estão desagregados por destino.
Os paraísos fiscais, também conhecidos como offshores, são regiões ou estados que possuem regimes fiscais extremamente baixos e permissivos e têm sido o principal instrumento utilizado nos diversos ilícitos financeiros revelados com a crise económica. Em Portugal, os famosos casos do BCP e do BPN, revelaram que os veículos offshore foram largamente utilizados para manipular os mercados e ocultar operações ilícitas.
Uma nova vitória da Frente Ampla no Uruguai e a confirmação de mais cinco anos no governo também terá impacto sobre as lideranças políticas de direita. Algumas das características da "nova direita" começaram a ser delineadas nesta campanha eleitoral. Já estamos presenciando uma política e um discurso mais irresponsáveis. Movidos por necessidades imediatas, muitos de seus membros ou candidatos, irão desenvolver uma forma mais demagógica para tentar recuperar votos perdidos e ganhar apoio em suas regiões, não importando qualquer implicação nacional de suas propostas. O artigo é do senador Rafael Michelini.
Rafael Michelini
Em 29 de novembro, quando as urnas confirmarem a vitória da fórmula Mujica/Astori, começará a transição para um novo governo da Frente Ampla e estará aberto um novo tempo político no país.
Esta será uma etapa rica de acontecimentos e uma das mais importantes para determinar um novo mapa político no Uruguai. Estará consolidada a continuidade no governo da Frente Ampla, estará confirmada a política de condução e de transformação, liderada pelo presidente mais bem sucedido e reconhecido na história moderna do Uruguai, Tabaré Vázquez e será ratificado o apoio da cidadania ao programa de governo surgido no V Congresso da Frente Ampla, chamado de Zelmar Michelini (*), realizado em dezembro do ano passado. José Mujica como presidente e Danilo Astori como vice-presidente, serão os responsáveis por liderar um novo governo nacional, que dará continuidade ao projeto político de esquerda, para uma nova fase de progresso e mudanças para o país. Mas uma nova vitória da Frente Ampla e da confirmação de mais cinco anos no governo, também terá impacto sobre as lideranças políticas de direita.
Uma nova derrota eleitoral será um duro golpe para as lideranças dos partidos tradicionais, que tiveram mais uma vez contestadas suas propostas, colocando na mesa o desafio da renovação e da mudança com a contestação dos atuais dirigentes.
Estamos mais próximos do fim de uma era e de um modelo de fazer política, tradicional e caudilhista, separado do povo. O mais importante nesta nova derrota da direita em 29 de Novembro é o fato de que ela representa também um duro golpe contra um dos piores vícios da política tradicional: a política do clientelismo, que antes e depois da ditadura, foi padrão de poder de líderes blancos e colorados de todo o país. Assistiremos a uma mudança inevitável na política da direita no Uruguai. Veremos um processo que terá de um lado o declínio final do clientelismo e em segundo lugar a retirada obrigatória dos líderes mais bem-sucedidos e representativos do pensamento e da política da direita nacional.
Para muitos de nós, que desde a restauração da democracia estamos acostumados à presença invariável de lideranças tradicionais em ambos os partidos, políticos que estiveram na vanguarda da política uruguaia, saber que nos próximos cinco anos estarão fora do cenário, é um verdadeiro alívio e um dos dados mais animadores ao pensar o futuro do país.
Nem Lacalle, nem Batlle, nem Sanguinetti voltarão a serem candidatos novamente e já não terão a mesma influencia sobre as decisões dos seus partidos, se blancos e colorados apostam em retomar seus partidos e propostas políticas para reconstituir uma proposta política mais moderna.
Nós não sabemos se quando a direita conseguir recompor sua mensagem e seu poder de convocar a sociedade, fará isto cortando os vínculos com seu passado como fez na Espanha, ou retomará os mesmos caminhos que estão marcando suas lideranças desgastadas. Não se sabe quanto tempo levará este processo, se um ou dois mandatos de governo e se Pedro Bordaberry será o novo porta-estandarte de blancos e colorados, ou talvez pague pelo enorme custo político da defesa incondicional do papel de seu pai no golpe de Estado e a ascensão da ditadura, oportunizando que apareçam novos dirigentes com menos resistências do eleitorado.
O certo é que depois do 29 de novembro a direita vai mudar e vai agir diferente da sua forma de expressão política atual. Também é de se supor, como da vez anterior, blancos e colorados necessitem de alguns anos para aceitar a realidade de uma nova derrota. A derrota eleitoral pode pautar muitas posições políticas da direita nos próximos meses, desconcertando a todos, como fizeram durante este período recente.
Mas algumas das características da "nova direita" começaram a ser delineadas nesta campanha eleitoral. Vamos ter direito a uma política e um discurso mais irresponsáveis. Movidos por necessidades imediatas, muitos de seus membros ou candidatos, irão desenvolver uma forma mais demagógica para tentar recuperar votos perdidos e ganhar apoio em suas regiões, não importando qualquer implicação nacional de suas propostas.
Vamos ter uma direita mais populista. Impedida e restringida na possibilidade de praticar o clientelismo político e no afã de recompor poder de convocação eleitoral, começará a prometer coisas que não podem ser atendidas ou que simplesmente pelo seu impacto nas finanças públicas são irrealizáveis. A atual proposta de campanha de Luis Alberto Lacalle de renúncia fiscal, eliminação de impostos ou diminuição do imposto de renda pessoa física, de um lado, com aumentos para aposentados e destinação de mais recursos para as políticas sociais, tudo sem dar qualquer explicação de como conseguira financiar as medidas propostas são os primeiros exemplos do que será o perfil da direita populista no futuro.
Durante os 20 anos que governaram juntos colorado e blancos, foi instalado na política do dia-a-dia como resposta a todas as reclamações e propostas da oposição e da sociedade civil o discurso do "não pode". Surpreendentemente e sem qualquer explicação, nesta campanha eleitoral, surgiu como resposta "agora tudo pode" acompanhando as iniciativas mais irresponsáveis.
O efeito de uma segunda vitória da Frente Ampla não só trará conseqüências para o país, seu rumo e a construção do nosso futuro, a mudança terá efeitos significativos na direita e nos partidos tradicionais. A Frente Ampla como força política e nosso futuro governo terá que ser muito cuidadoso e muito responsável, para evitar provocações e as políticas nocivas que vêm do desespero da derrota. Teremos que conjugar muito calma e cautela, com toda a flexibilidade e abertura possível para oferecer um diálogo político sério sobre as políticas mais importantes a serem aplicadas nas áreas nevrálgicas do país.
O público irá nos dar uma enorme responsabilidade de governar o país por mais cinco anos. Os problemas e desafios da construção do desenvolvimento do nosso país vão se juntar com o fato de que vamos governar com a oposição dos partidos tradicionais, cada vez mais inclinados para a direita e desesperados.
A vitória de Mujica e Astori, em 29 de Novembro, é a consolidação de um projeto de desenvolvimento nacional que tem a Frente Ampla no governo como seu principal protagonista, tanto na condução como gestão dos principais objetivos do país. Representa à confirmação da mudança, a continuidade das nossas reformas, a criação de novas transformações. Para a direita é muito mais do que uma derrota eleitoral e eles sabem muito bem disso.
(*) Senador, Novo Espaço FA, filho de Zelmar Michellini, líder político da recém fundada Frente Ampla que foi assassinado nos anos 70, na Argentina, por militares uruguaios. Tradução: Gustavo de Mello
Introduction
On the eve of the Copenhagen conference, a group of scientists has issued an update on the 2007 report of the Intergovernmental Panel on Climate Change. In the face of an incredible din of disinformation from climate deniers, they have mustered the latest and most credible evidence to inform global leaders and attentive publics just how perilous our present situation is. Among other dire warnings, they conclude that the icecaps at both poles are melting faster than predicted, that claims of recent global cooling are false, and that world leaders must act fast if steep temperature rises are to be avoided.
The report, and Elizabeth Kolbert’s assessment, were issued just prior to proposals for greenhouse gas reductions by the world’s two leading emitters: China and the United States, whose proposals emerged from a summit meeting of the leaders of the two countries. Together, the US and China account for fully forty percent of global emissions. Their proposed reductions appear to have renewed hopes for the December 7-18 Copenhagen talks. But the non-binding character of the proposals also shows how far we remain from reaching an agreement anywhere close to the scale that the science tells us is essential.
Chinese and U.S. emissions and GDP projections, 1990-2030
China on November 26, announced a goal cutting its "carbon intensity" – that is, the amount of greenhouse gas it emits per unit of gross domestic product – by 40% to 45% below 2005 levels by 2020. The plan differs in fundamentals from those offered by the U.S., Japan, Korea and the European Union in that it does not aim at an outright reduction of emissions, but rather pledges to slow the rate at which emissions grow by increasing energy efficiency in its expanding economy. The Worldwide Fund for Nature estimates that, from 2010 to 2015, China’s target will keep fully 4 gigatons of carbon out of the atmosphere. China’s plan also complements the country’s very aggressive moves to promote green energy, where it is poised to overtake all competitors.
The Chinese statement came one day after US President Barack Obama announced that he would travel to the U.N. climate summit in Copenhagen on December 9. Obama also declared he would pledge the U.S. to a 17% cut in greenhouse-gas emissions from 2005 levels by 2020 and 83% by 2050. He added that the US would also adopt a mid-term goal of a 42% reduction below 2005 by 2030.The Obama proposals are, to be polite, modest compared with those advanced by other developed nations. Indeed, given the economic recession of 2007-09, the goals may add little to the reductions already in place as a result of industrial cutbacks. Germany, Japan and the European Union have all proposed more ambitious reductions. Germany stands out for its commitment of a 40% reduction in emissions by 2020, compared to 1990 levels. Japan’s recently elected government also quickly committed the country to a 25% cut in emissions by 2020, versus 1990 levels. And the 27 members of the EU have pledged to reduce emissions by 20% below their 1990 levels by 2020, or the equivalent of a 14% cut from 2005 levels. They have also made a larger reduction, equivalent to a 24% cut from 2005 levels by 2020, if nations outside the bloc agree to substantial cuts.
But perhaps the most important stumbling block in the face of Obama is politics. The Obama proposal is in line with legislation currently under review in the House of Representatives. But the U.S. Congress will not act prior to Copenhagen and it is far from certain that it will approve any legislation next year. Since November of 2010 will see mid-term Congressional elections (including all member of the House of Representatives and 1/3 of the Senate), the fate of any American climate legislation is likely bound up with such variables as Obama’s dwindling support and the mounting backlash against his kid-glove treatment of Wall Street.
Equally important is the fact that neither the Chinese nor the US plans offer any indication of whether and how the developed nations will help to pay for emissions reduction in the developing countries. This issue is important key to an international agreement, and is probably also key to whether the US Congress will act affirmatively in the wake of any Copenhagen agreement. China and other developing countries have called on the developed countries to pay 1% of their annual GDP to help developing countries finance emission reductions. AD and MS
Ahead of talks in Copenhagen, a group of leading climate scientists has issued a new report summarizing the most recent research findings from around the world and concluding that scientists have underestimated the pace and extent of global warming. The report — titled “The Copenhagen Diagnosis” — finds that in several key areas observed changes are outstripping the most recent projections by the UN’s Intergovernmental Panel on Climate Change and warns that “there is a very high probability of the warming exceeding 2 °C unless global emissions peak and start to decline rapidly” within the next decade.
The report points to dramatic declines in Arctic sea ice, recent measurements that show a large net loss of ice from both Greenland and Antarctica, and the relatively rapid rise in global sea levels — 3.4 millimeters per year — as particular reasons for concern. Sea-level rise this century, it states, “is likely to be at least twice as large” as predicted by the most recent IPCC report, issued in 2007, with an upper limit of roughly two meters.
“Sea level is rising much faster and Arctic sea ice cover shrinking more rapidly than we previously expected,” Stefan Rahmstorf, department head at Germany’s Potsdam Institute for Climate Impact Research, said in a press release accompanying the report. “Unfortunately, the data now show us that we have underestimated the climate crisis in the past.”
According to the report, which was released today, several elements of the climate system could reach a ‘tipping point’ in coming decades if current emissions trends continue. The report notes that even at current greenhouse gas concentrations, it is already “very likely” that a “summer ice-free Arctic is inevitable.” The Greenland Ice sheet, too, the report warns, “may be nearing a tipping point where it is committed to shrink.”
The report’s 26 authors include scientists from Germany, France, Switzerland, Austria, Canada, the U.S., and Australia. Most were also authors of the last IPCC report, and donated their time to draft “The Copenhagen Diagnosis.” The University of New South Wales’ Climate Change Research Centre provided logistical support.
“We thought that the IPCC report from 2007 was a superb report, but of course science doesn’t stand still,” Richard Somerville, a climate modeler and professor emeritus as the Scripps Institution of Oceanography, said. “And we thought it would be helpful if we could provide some kind of updated assessment.”
In an e-mail message from Antarctica, where he is doing fieldwork, Robert Bindschadler, of NASA, said the group had been prompted to write the report by “the rapidity and serious consequences of climate change.”
Georg Kaser, a glaciologist at the University of Innsbruck, said he hoped policymakers would respond to the report by deciding to “totally phase out fossil-fuel burning within the next two decades.”
“Dreaming is allowed,” he added. “Frankly speaking, I would not like to be a policymaker that has just two options: one, phasing out fossil fuel burning immediately, or two, committing our society to major and long-lasting changes in the climate system.”
The report was already completed but not released by the time world leaders, including President Obama, announced in Singapore on Nov. 15 that they had abandoned the goal of reaching a legally binding agreement in Copenhagen. Since then, several countries have announced commitments to reduce their greenhouse gas emissions, including South Korea, which last week pledged to a cut of 20 percent below “business as usual” by 2020, and Brazil, which promised reductions of 40 percent below current projections by 2030. But the United States, with some of the highest per capita emissions in the world and the second-highest overall emissions, after China, has made no commitment, and legislation to curb emissions, which narrowly passed the House this year, is not expected to be taken up by the U.S. Senate until after the Copenhagen session is over.
Andrew Weaver, a climate modeler at Canada’s University of Victoria and one of the authors of “The Copenhagen Diagnosis,” said he found the announcement that world leaders were abandoning the goal of reaching a binding agreement this year “unacceptable.”
He went on: “Maybe they should be honest, and stand up and say, ‘You know what? As your political leaders we do not accept that we owe anything to future generations.’ I don’t think they’d ever say that, but this is what they are saying if they don’t deal with this problem.”
“The Copenhagen Diagnosis” is not the first report to warn that climate change is occurring even more rapidly than had been predicted by the IPCC. Indeed, the UN itself has made this point. In September, the United Nations Environment Program released its “Climate Change Science Compendium 2009.” In the foreword of that report, UN Secretary General Ban Ki-moon noted that “climate change is accelerating at a much faster pace than was previously thought by scientists.” He warned: “Unless we act, we will see catastrophic consequences including rising sea levels, droughts and famine, and the loss of up to a third of the world’s plant and animal species.”
“The Copenhagen Diagnosis” is explicitly aimed at “policy-makers, stakeholders, the media and the broader public” on the eve of the international climate talksthat begin on Dec. 7. It takes up several questions of the sort not typically addressed in scientific forums, but frequently raised on the Internet and in the press. One of these is whether the Earth’s atmosphere is already saturated with carbon dioxide. The answer to this question, the report says, is “Not even remotely. It isn’t even saturated on the runaway greenhouse planet Venus, with its atmosphere made up of 96% CO2 and a surface temperature of 467 °C.” Similarly, the report states, “global cooling” has not occurred over the past decade, “contrary to claims promoted by lobby groups and picked up in some media.” In fact, “even the highly ‘cherry-picked’ 11-year period starting with the warm 1998 and ending with the cold 2008 still shows a warming trend of 0.11 °C per decade,” the report concludes.
The report notes that in recent years, solar output has been at a low ebb. Meanwhile, warming has continued: “It is perhaps noteworthy that despite the extremely low brightness of the sun over the past three years temperature records have been broken during this time… The years 2007, 2008 and 2009 had the lowest summer Arctic sea ice cover ever recorded, and in 2008 for the first time in living memory the Northwest Passage and the Northeast Passage were simultaneously ice-free. This feat was repeated in 2009. Every single year of this century (2001-2008) has been among the top ten warmest years since instrumental records began.”
Konrad Steffen, a glaciologist at the University of Colorado who recently returned from taking measurements on Antarctica, said, “We as scientists wanted to make sure we provided all possible information. We tried to stay away from judgment calls — you wouldn’t believe the lengthy emails that we had — but on the other hand we wanted to make sure the urgency is there. We want to tell people it is urgent. We see changes that we did not anticipate two or three years ago.”
Gavin Schmidt, a NASA climate scientist who was not involved in “The Copenhagen Diagnosis,” said he thought the report was scientifically sound, but questioned whether it would have much impact on its target audience. “Knowing exactly how fast emissions are rising, or sea ice is melting, is useful and interesting, but my guess is that it will not have much effect on the delegates, since it doesn't address the actual equity and political issues that are at the heart of the slow movement towards an agreement,” said Schmidt.
Richard Somerville, of Scripps, acknowledged that scientific information — up-to-the minute or otherwise — was often ignored at climate negotiations.
“I’ve been to several of these meetings,” he said. “The delegates and the leaders say very kind things about the IPCC and thank it for its excellent work. But then, from a scientist’s point of view, once the negotiations start they might as well be negotiating, say, steel tariffs. I’ve actually heard politicians say — I won’t name any names — ‘We don’t want to be constrained by the science.’” But, he added, that only makes it more essential to get the information out.
“Not politicians and not money and not public opinion, but the climate system itself imposes a time scale,” Somerville said. “And if the world chooses not to stick within that, well, Mother Nature bats last.”
This report appeared at Environment 360, a publication of The Yale School of Forestry and Environment Studies. Comments on the original article can be foundhere.
Elizabeth Kolbert
Thirty global financial institutions make up a list that regulators are earmarking for cross-border supervision exercises, the Financial Times has learnt.
The list includes six insurance companies – Axa, Aegon, Allianz, Aviva, Zurich and Swiss Re – which sit alongside 24 banks from the UK, continental Europe, North America and Japan.
The list has been drawn up by regulators under the auspices of the Financial Stability Board, in an effort to pre-empt systemic risks from spreading around the world in any future financial crisis.
Insurers are considered systemically important for a variety of reasons: they might, for example, have a large lending arm, such as Aviva, or a complex financial engineering business, akin to that of Swiss Re.
Supervision spotlight
Banks
US
Bank of America Merrill Lynch
Citigroup
Goldman Sachs
JPMorgan Chase
Morgan Stanley
Canada
Royal Bank of Canada
UK groups
Barclays
HSBC
Royal Bank of Scotland
Standard Chartered
Switzerland
Credit Suisse
UBS
France
BNP Paribas
Société Générale
Spain
BBVA
Santander
Japan
Mitsubishi UFJ
Mizuho
Nomura
Sumitomo Mitsui
Italy
Banca Intesa
UniCredit
Germany
Deutsche Bank
Netherlands
ING
Insurance groups
Aegon
Allianz
Aviva
Axa
Swiss Re
Zurich
AIG of the US, the failed insurance group, was proven to be a vast systemic risk last year, in large part because of its diversification from insurance into complex financial engineering.
Raj Singh, chief risk officer of Swiss Re, said: “The real interconnectivity for the insurance industry is more muffled in that there needs to be a dual trigger for there to be any big systemic effects.”
The list, which is not public, contains many of the multinational bank names that would be widely expected.
The exercise follows the establishment of the FSB in the summer and is principally designed to address the issue of systemically important cross-border financial institutions through the setting up of supervisory colleges.
These colleges will comprise regulators from the main countries in which a bank or insurer operates and will have the job of better co-ordinating the supervision of cross-border financial groups.
As a spin-off from that process, the groups on the list will also be asked to start drawing up so-called living wills – documents outlining how each bank could be wound up in the event of a crisis.
Regulators are keen to see living wills prepared for all systemically important financial groups, but the concept has split the banking world, with the more complex groups arguing that such documents will be almost impossible to draft without knowing the cause of any future crisis.
Paul Tucker, deputy governor of the Bank of England, and head of the FSB working group on cross-border crisis management, said recently that the wills – also known as “recovery and resolution” plans – would have to be drawn up over the next six to nine months.
National regulators, led by the UK, are known to have begun pilot-testing the living wills exercise with some of the listed banks in the past few weeks.
Patrick Jenkins and Paul J Davies in London
Voters in Switzerland have approved a ban on the construction of minarets on mosques, official results show. Of those who cast votes in Sunday's poll, 57.5 per cent approved the ban, while only four cantons out of 26 rejected the proposals. The result paves the way for a constitutional amendment to be made. "The Federal Council [government] respects this decision. Consequently the construction of new minarets in Switzerland is no longer permitted," the government, which had opposed the ban, said in a statement. The Swiss People's Party (SVP) had forced a referendum on the issue after it collected 100,000 signatures within 18 months from eligible voters. Unexpected result Alan Fisher, Al Jazeera's correspondent in Bern, the Swiss capital, said: "There is concern in Switzerland undoubtedly about what is being seen as the spread of radical Islam, but the Muslim community here has always been regarded as fairly moderate.
After the official results were known, far-right politicians celebrated, while the government sought to assure the Muslim minority that a ban on minarets was "not a rejection of the Muslim community, religion or culture". Eveline Widmer-Schlumpf, Switzerland's justice minister, said the result "reflects fears among the population of Islamic fundamentalist tendencies". "These concerns have to be taken seriously ... However, the Federal Council takes the view that a ban on the construction of new minarets is not a feasible means of countering extremist tendencies," she said. Farhad Afshar, who heads the Co-ordination of Islamic Organisations in Switzerland, said that "the most painful for us is not the minaret ban, but the symbol sent by this vote." 'Anti-Islamic hate' Supporters of the ban say minarets represent the growth of an alien ideology and legal system that have no place in the Swiss democracy.
But Switzerland's Muslims have said that the referendum is fuelling anti-Islamic feeling in the country. "The initiators have achieved something everyone wanted to prevent, and that is to influence and change the relations to Muslims and their social integration in a negative way," Taner Hatipoglu, the president of the Federation of Islamic Organisations in Zurich, said. "We are frightened, and if the atmosphere continues to be like this and if the anti-Islamic hate increases, then the Muslims indeed will not feel safe anymore. This of course is very unpleasant." About 400,000 Muslims live in Switzerland, whose population is just under eight million. Most Muslim citizens are immigrants from the former Yugoslavia and Turkey. Although Islam is the country's second largest religion after Christianity, there are only four mosques with minarets in the whole country. Posters have appeared in many Swiss cities showing a figure of a woman shrouded from head to foot in a burka. Behind her is the Swiss flag, shaped like a map of the country, with black minarets shooting up out of it like missiles. The United Nations Human Rights Committee called the posters discriminatory and said Switzerland would violate international law if it bans minarets. "The reality is, as was described to me by a Swiss resident who is not a Swiss citizen, this is the right-wing Swiss People's Party sending out a message to Muslims: 'Know your place in Switzerland'," he said. "They believe, the right-wing People's Party, that if the Muslims get their mosques and their minarets it will follow on that they will want, perhaps, separate schooling and there could be a campaign to turn Switzerland, of all places, into a place that practices Sharia [Islamic law]." | |||||||||||||||
