“Our real manmade climate crisis takes four closely related forms…. Influence peddling…. Politicized science, markets, and ethics… Climate eco-imperialism that impoverishes and kills…. Ready-made excuses for incompetence.”
In his first address as Secretary of State, John Kerry said we must safeguard “the most sacred trust” we owe to our children and grandchildren: “an environment not ravaged by rising seas, deadly superstorms, devastating droughts, and the other hallmarks of a dramatically changing climate.”
But hyperbole is getting stale even for a politician. The Intergovernmental Panel on Climate Change and British Meteorological Office now recognize that average global temperatures haven’t budged in almost 17 years. Little evidence suggests that sea level rise, storms, droughts or other weather and climate events or trends display any statistically significant difference from what Earth and mankind have experienced over the last 100-plus years.…
Continue Reading“[T]here are, at bottom, basically two ways to order social affairs. Coercively, through the mechanisms of the state … and voluntarily, through the private interaction of individuals and associations…. Civil society is based on reason, eloquence, and persuasion, which is to say voluntarism. Political society, on the other hand, is based on force.”
– Edward Crane (quotation), founder, Cato Institute
The worldview for entrusting consenting adults with energy is, broadly speaking, libertarian. Consumers are more knowledgeable than government agents on what (energy) products are most valuable in terms of convenience, price, and reliability. And as experience has shown time and again, politicizing energy creates problems rather than solves them. Restated, there is government failure in the quest to address alleged market failures.
Obama’s GOVERNMENT
Arguments about energy also apply to health care, money and banking, and other pillars of the modern economy.…
Continue Reading“[Free energy] markets tend not only to clear, but to clear faster and at lower prices than anticipated.”
The resignation of Aubrey McClendon as CEO of Chesapeake Energy provides a good case to study in corporate strategic planning. Ignoring his financial side deals, for which he has received a good share of criticism, the wisdom of his primary strategy, the aggressive pursuit of shale resources, is an open question to many. Although he has been hailed as a pioneer and risk taker, clearly those risks have gone bad and should be examined.
Higher Prices: A Bad Bet
The core failing was his decision to bet the firm (essentially) on high natural gas prices. From 1997 to 2005, wellhead prices had increased from $3/Mcf to $8/Mcf (2010$), the highest level historically. This, combined with a neo-Malthusian mentality, convinced him and many others that prices would not be mean-reverting, but remain at levels from two to three times the historical average.…
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