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Daily Archives: February 11, 2014

14 Turkish Protesters Jailed For 2 Years For “Insulting” Prime Minister | Zero Hedge

14 Turkish Protesters Jailed For 2 Years For “Insulting” Prime Minister | Zero Hedge.

Forget throwing Molotov cocktails; don’t worry about throwing stones or hand to hand combat with the Police… the real trouble for Turkish protesters appears to be “insults” and “tree-hugging”:

  • *TURKEY PROSECUTOR REQUESTS JAIL FOR TREE-PLANTING STUDENTS: NTV
  • *Turkey Protesters Given Jail for Insults to Erdogan

The punishments vary from 2-years to 14 years in jail!!

So it seems sticks and words can hurt one after all…

If you can’t do the time, don’t plant a tree…

Prosecutor asks for jail time for students protesting the construction of a road at Middle East Technical University in Ankara, NTV news reports.

Three students detained after planting trees as part of protest and charged with obstructing public works

Prosecutor asks for jail sentences ranging from 2 yrs, 6 months to 14 yrs, 6 months

or dare to insult the Prime Minister…

 Court in Eskisehir gives 17 suspects jail terms for insulting Prime Minister Recep Tayyip Erdogan during a demonstration, state-run Anatolia news agency reports.

14 suspects get two-year jail sentences each, 3 other suspects get 1 year imprisonment each, Anatolia says

All seems very “fair”…

The Golden Age of Gas… Possibly: An Interview With The IEA | Zero Hedge

The Golden Age of Gas… Possibly: An Interview With The IEA | Zero Hedge.

Submitted by James Stafford via OilPrice.com,

The potential for a golden age of gas comes along with a big “if” regarding environmental and social impact. The International Energy Agency (IEA)—the “global energy authority”–believes that this age of gas can be golden, and that unconventional gas can be produced in an environmentally acceptable way.

In an exclusive interview with Oilprice.com, IEA Executive Director Maria van der Hoeven, discusses:

  • The potential for a golden age of gas
  • What will the “age” means for renewables
  • What it means for humanity
  • The challenges of renewable investment and technology
  • How the US shale boom is reshaping the global economy
  • Nuclear’s contribution to energy security
  • What is holding back Europe’s energy markets
  • The next big shale venues beyond 2020
  • The reality behind “fire ice”
  • Condensate and the crude export ban
  • The most critical energy issue facing the world today

Interview by. James Stafford of Oilprice.com

Oilprice.com: In 2011, the IEA predicted what it called “the golden age of gas,” with gas production rising 50% over the next 25 years. What does this “golden age” mean for coal, oil and nuclear energy—and for renewables? What does it mean for humanity in terms of carbon emissions? Is the natural gas boom lessening the sense of urgency to work towards renewable energy solutions?

IEA: We didn’t predict a golden age of gas in 2011, we merely asked a pertinent question: namely, are we entering a golden age of gas? And we found that the potential for such a golden age certainly exists, especially given the scale of unconventional gas resources and the advances in technology that allow their extraction. But the potential for a golden age of gas hinges on a big “if,” and we elaborated on this in 2012 in a report called “Golden Rules for a Golden Age of Gas”. Exploiting the world’s vast resources of unconventional natural gas holds the key to golden age of gas, we said, but for that to happen, governments, industry and other stakeholders must work together to address legitimate public concerns about the associated environmental and social impacts. Fortunately, we believe that unconventional gas can be produced in an environmentally acceptable way.

Under the central scenario of the World Energy Outlook-2013, natural gas production rises to 4.98 trillion cubic metres (tcm) in 2035, up nearly 50 percent from 3.38 tcm in 2011. But we have always said that a golden age of gas does not necessarily imply a golden age for humanity, or for our climate. An expansion of gas use alone is no panacea for climate change. While natural gas is the cleanest fossil fuel, it is still a fossil fuel. As we have seen in the United States, the drastic increase in shale gas production has caused coal’s share of electricity generation to slide. Of course, there is also the possibility that increased use of gas could muscle out low-carbon fuels, such as renewables and nuclear, from the energy mix.

OP: When will we see “the golden age of renewables”?

IEA: Although we have not yet predicted a “golden age” of renewables, the current, rapid growth of renewable power is a bright spot in an otherwise bleak picture of global progress towards a cleaner and more diversified energy mix. Still, the investment case for capital-intensive, low carbon power technologies carries challenges. We need to distinguish between two situations:

•    In emerging economies, renewable power often provides a cost-competitive alternative to new fossil based generation and are perceived as part of the solution to questions of energy supply, diversification, and economic development. In China, for example, efforts to reduce local pollution are stimulating major investments in cleaner energy.

•    By contrast, in stable systems with sluggish demand, no technology is competitive with marginal electricity prices, due to overcapacity. Governments are nervous about increasing investment in low-carbon options which impact on consumer prices, and this is causing policy uncertainty. But long term energy security and environmental goals need to be kept in mind.

The overall outlook for renewable electricity remains positive, even as the outlook can vary strongly by market and region. However, the electricity sector comprises less than 20% of total final energy consumption. The growth of renewables in other sectors such as transport and heat has been more sluggish. For a golden age of renewables to materialise, greater progress is needed in these areas, for example, with the development of advanced biofuels and more policy frameworks for renewable heat.

OP: How is the shale boom reshaping the global financial and economic system? Who are the winners and losers in this emerging scenario?

IEA: One of the key messages of our World Energy Outlook-2013 is that lower energy prices in the United States mean that it is well-placed to reap an economic advantage, while higher costs for energy-intensive industries in Europe and Japan are set to be a heavy burden.

Natural gas prices have fallen sharply in the United States – mainly as a result of the shale gas boom –  and today they are about three times lower than in Europe and five times lower than in Japan. Electricity price differentials are also large, with Japanese and European industrial consumers paying on average more than twice as much for electricity as their counterparts in the United States, and even Chinese industry paying  almost double the US level.

Looking to the future, the WEO found that the United States sees its share of global exports of energy-intensive goods slightly increase to 2035, providing the clearest indication of the link between relatively low energy prices and the industrial outlook. By contrast, the European Union and Japan see their share of global exports decline – a combined loss of around one-third of their current share.

OP: The IEA has noted that the US is no longer so dependent on Canadian oil and gas. What could this mean for pending approval of TransCanada’s Keystone XL pipeline? How important is Keystone XL to the US as opposed to its importance for Canada?

IEA: The decision on the Keystone matter is one that must be taken by the United States Government. I am afraid it is not for the IEA to comment.

OP: With the nuclear issue taking center stage in Japan’s election atmosphere, is Japan ready to pull the plug entirely on nuclear, or is it too soon for that?

IEA: This year’s World Energy Outlook, which we will release in November 2014, will carry a special focus on nuclear energy, so please stay tuned. While I won’t discuss what Japan should do, I will say that every country has a sovereign right to decide on the role of nuclear power in its energy mix. Nevertheless, nuclear is one of the world’s largest sources of low-carbon energy, and as such, it has made and should continue to make an important contribution to energy security and sustainability.

A country’s decision to cut the share of nuclear in its energy mix could open up new opportunities for renewables, particularly as some phase-out plans envision the replacement of nuclear capacity largely with renewable energy sources. However, such a decision would also likely lead to higher demand for gas and coal, higher electricity prices, increased import dependency on fossil fuels and electricity, and a more difficult path towards decarbonisation. Such a scenario would therefore make it much more difficult for the world to meet the 2°C climate stabilisation goal, and have potentially negative impacts on energy security.

OP: What is the key factor holding back European energy markets?

IEA: Europe has quite a few advantages but also many hurdles to overcome. If I had to pick one key factor that is holding back European energy markets, I would say it is the lack of cross-border interconnections. Let me explain what I mean. As we showed in WEO 2013, Europe’s competitiveness is under pressure, as energy price differences grow between Europe and its major trading partners – the US, China and Russia. High oil and gas import prices combined with low gas and electricity demand, following the recession, are impacting European economies.

Europe should accelerate the use of its indigenous potential and reap the social and economic benefits from energy efficiency, renewable energies and unconventional oil and gas. In open economies, there are significant advantages to be gained from free trade and a large energy market. One example: Today, we cannot make use of competitive electricity prices across the EU, as physical trade barriers exist and markets remain national. Europe is failing to achieve its potential. The electricity grid and system integration is very low, which also serves as a barrier to the full and efficient exploitation of renewable energy potentials. This is why addressing the issue of cross-border interconnections is so important.

OP: Where do you foresee the next “shale boom”?

IEA: According to WEO projections, there will be little non-North American shale development before 2020 due to the much earlier stage of exploration and the time needed to build up the oil field service value chain. Beyond 2020, we project large-scale shale gas production in China, Argentina, Australia as well as significant light tight oil production in Russia. The current reform proposals in Mexico have the potential to put Mexico on the top of that list as well, but they need to be properly implemented.

OP: What is the realistic future of methane hydrates, or “fire ice”?

IEA: Methane hydrates may offer a means of further increasing the supply of natural gas. However, producing gas from methane hydrates poses huge technological challenges, and the relevant extraction technology is in its infancy. Both in Canada and Japan the first test drillings have taken place, and the Japanese government is aiming to achieve commercial production in 10 to 15 years.

One thing I always mention when I am asked about methane hydrates is this: It may seem far off and uncertain, but keep in mind that shale gas was in the same position 10 to 15 years ago. So we cannot rule out that new energy revolutions may take place through technological developments and price incentives.

OP: Have we hit the “crude wall” in the US, the point at which oil production growth may end up slowing due to infrastructure and regulatory constraints?

IEA: In January 2013, the IEA’s Oil Market Report examined the possibility that as surging production continues to move the US closer to becoming a net oil exporter, there may come a time when various regulations, particularly the US ban on exports of crude oil to countries other than Canada, could have an adverse impact on continued investment in LTO – and thus continued growth in production. We called this point the “crude wall”.

A year later, in our January 2014 Oil Market Report, we noted that with US crude oil production exceeding even the boldest of expectations in 2013 by a wide margin, the crude wall now seems to be looming larger than ever. Having said that, challenges to US production growth are not imminent. Potential US growth in 2014 seems a given, even against the backdrop of resurgent non-OPEC supply growth outside North America.

OP: How is this shaping the crude export debate and where do you foresee this debate leading by the end of this year?

IEA: You are better off asking my friends and colleagues in Washington! This is obviously a sensitive topic. Different people feel differently about it, often very strongly. Oil policy always is the product of multiple, sometimes-competing considerations.

OP: What would lifting the ban on crude exports mean for US refiners, and for the US economy?

IEA: Many refiners and other major oil consumers have said they support keeping the ban amid worries that allowing exports would result in higher feedstock costs and erode their competitive advantage, or shift value-added industry abroad. On the other hand, oil producers have in general come out in favour of lifting the ban, arguing that the “crude wall” may become so large that it cannot be overcome; they see the possibility of a glut causing prices to slump and thereby choking off production. We have not produced any detailed analysis on the economic impact of lifting the ban, so I cannot comment on that part of your question.

OP: Are there any other ways around the “crude wall” aside from lifting the export ban?

IEA: As we wrote in our January 2014 Oil Market Report, much of the LTO is produced in the form of lease condensate, which is most optimally processed in a condensate splitter. There is currently only one such facility in the United States, although at least five others are in various stages of planning and construction.

I mention this issue because one could imagine a scenario under which lease condensate is excluded from the crude export restriction. The US Department of Commerce, which enforces the export ban, includes lease condensates in the definition of crude oil. However, this definition could be changed, or the Commerce Department could simply issue lease condensate export licenses at the behest of the President.

OP: How will the six-month agreement to ease sanctions on Iran affect Iranian oil production? And if international sanctions are indeed lifted after this “trial period”, how long will it take Iran to affect a real increase in production?

IEA: The deal between P5+1 and Iran doesn’t change the oil sanctions themselves. The oil sanctions remain fully in place though the P5+1 agreed not to tighten them further. Relaxing insurance sanctions doesn’t mean more oil in the market.

As for the second part of your question, I am afraid I can’t answer hypotheticals and what-ifs.

OP: What is the single most critical energy issue in the US this year?

IEA: I think that if you take the view that the energy-policy decisions you make now have ramifications for many decades to come, and if you believe what scientists tell us about the climate consequences of our energy consumption, then the single most critical energy issue in the US is the same issue for every country: what are you going to do with your energy policy to mitigate the risk of climate change? Energy is responsible for two-thirds of greenhouse-gas emissions, and right now these emissions are on track to cause global temperatures to rise between 3.6 degrees C and 5.3 degrees C. If we stay on our present emissions pathway, we are not going to come close to achieving the globally agreed target of limiting the rise in temperatures to 2 degrees C; we are instead going to have a catastrophe. So energy clearly has to be part of the climate solution – both in the short- and long-term.

OP: What is the IEA’s role in shaping critical energy issues globally and how can its influence be described, politically and intellectually?

IEA: Founded in response to the 1973/4 oil crisis, the IEA was initially meant to help countries co-ordinate a collective response to major disruptions in oil supply through the release of emergency oil stocks to the markets.

While this continues to be a key aspect of our work, the IEA has evolved and expanded over the last 40 years. I like to think of the IEA today as the global energy authority. We are at the heart of global dialogue on energy, providing authoritative statistics, analysis and recommendations. This applies both to our member countries as well as to the key emerging economies that are driving most of the growth in energy demand – and with whom we cooperate on an increasingly active basis.

The Corporate Media’s Dubious Syria Coverage | Global Research

The Corporate Media’s Dubious Syria Coverage | Global Research.

Global Research, February 11, 2014
In-depth Report: 

Western news media reportage on the rampant criminal activities of foreign-backed paramilitary groups operating within Syria still relies heavily on unreliable sources frequently referred to as “activists.” Such spokespersons routinely claim the Syrian military are committing atrocities against the Syrian population. The reports are often disputed by the Bashar al-Assad government and proven suspect or false when additional information is unearthed by independent researchers and alternative news media.

In July 2012 UK journalist Charlie Skelton reported that Western news outlets remain willing accomplices in a propaganda campaign being carried out by public relations practitioners. According to Skelton, “the spokespeople, the ‘experts on Syria’, the ‘democracy activists’ … The people who ‘urge’ and ‘warn’ and ‘call for action’” against the Assad regime are themselves part of a sophisticated and well-heeled propaganda campaign to allow NATO forces to give Syria the same medicine administered to Libya in 2011. “They’re selling the idea of military intervention and regime change,” Skelton reports,

and the mainstream news is hungry to buy. Many of the “activists” and spokespeople representing the Syrian opposition are closely (and in many cases financially) interlinked with the US and London – the very people who would be doing the intervening. Which means information and statistics from these sources isn’t necessarily pure news – it’s a sales pitch, a PR campaign.[1]

One needn’t look far for current examples of such uncertain reportage and sourcing from eminent news organizations. For example, a prominent February 8, 2014 story from Turkey’s state-run Anadolu Agency, titled, “Aleppo Bombings Kill 23, Activists Say,” carries the lead, “At least 23 people have been killed as a regime helicopter dropped barrel bombs on an opposition-controlled district in Syria’s largest city Aleppo on Saturday, activists said.”[2]

The New York Times reports, “Rebel and government groups have each been accused of massacring civilians, and the government has stepped up air attacks on Aleppo with barrages of improvised ”barrel bombs” packed with high explosives that activists say have killed more than 200 people.[3]

Similarly influential papers such as the Washington Post also remain unabashedly forthright in their reliance on such sourcing. A recent Associated Press piece carried in the paper, titled, “Activists: Syrian Forces Launch New Aleppo Strikes,” quotes the Aleppo Media Center, a self-described “anti-Bashar Assad activist group.” Post readers are assured the entity “has been authenticated based on its contents and other AP reporting.”[4]

Likewise, in November 2013 the BBC, whose Syria coverage tilts strongly toward “activist” observations, cites the UK-based Syrian Observatory for Human Rights to break the story of Syrian government air strikes “kill[ing] dozens in Aleppo.“ As Skelton noted in his 2012 exposé, “The Syrian Observatory for Human Rights is commonly used as a standalone source for news and statistics” which are taken at face value and parroted by corporate media. While SOHR sounds like a credible and non-partisan human rights outfit, “’They’ are Rami Abdulrahman (or Rami Abdel Rahman), who lives in Coventry,” Skelton observes. In 2011 Reuters reported that when Abdulrahman “isn’t fielding calls from international media, [he] is a few minutes down the road at his clothes shop, which he runs with his wife.”[5]

The analysis suggests how despite the fact that those regularly quoted as authorities on Syria are often far-removed from what is transpiring on the ground and thus involved in a more far-reaching disinformation program to confuse the public on the calculated murder and chaos being carried out throughout Syria by Western-financed mercenary forces.

With the foreign-backed destabilization of Syria now well over two years old, major corporate-owned and government-backed news media, perhaps amazingly, continue to rely on such questionable entities as sources. Indeed, a Google search of “activists say” and “Syria” yields 919,000 results.

A more careful LexisNexis database search for “Syria,” “Assad,” “government” and the phrases “activists say” or “activists report” in the subject headings or text of news items for conventional print outlets indexed for June 1, 2012 to February 7, 2014 yields a data set consisting of close to 2,000 pieces—1,638 newspaper articles, 205 BBC broadcast transcripts, and 148 web-based articles.[6] A total 134 articles appeared in the New Zealand Herald, 52 in the Washington Post, 38 in the New York Times, 30 in the Financial Times, and 28 in the International New York Times.

The following table breaks down the news outlets that, based on the above search parameters, appear to have used so-called “activists” as sources 20 or more times since June 1, 2012.

News Outlet News Articles / Transcripts Referencing “Associated Press”
British Broadcasting Corporation 205
New Zealand Herald 134 43
Belfast Telegraph Online 97  –
Washington Post 52 26
Daily Star (Lebanon) 38  –
New York Times 38 5
Today’s Zaman (Turkey) 36  –
The National (UAE) 34 21
Anadolu Agency 32  –
Bismarck Tribune 30  –
Financial Times 30 15
Scotsman 29  –
Guardian 28  –
International New York Times 28 8
The Capitol (Annapolis MD) 26 13
McClatchey Tribune 26  –
Times of Oman 26  –
Salt Lake City Tribune 25 23
Times & Transcript 24 5
Times (London) 23  –
The Mirror 22  –

About 13.5% of the sample (270) either reference the Associated Press as a source or are AP wire stories. A search for “Associated Press” within the search results yields 270 articles, including a significant number appearing in the New Zealand Herald (43), the Washington Post (26), The National (21), the Bismarck Tribune (15), and the International New York Times (8). A far smaller number of the overall sample (33) reference “Reuters.”

Combined with an acquiescent news media that are arguably complicit in such deception, the end result amounts to sheer propaganda selling the “Syrian revolution” and further conditioning world public opinion for the inevitability of gradual regime change or even more direct military intervention.

After over two decades of phony atrocity stories and tall tales involving Middle Eastern bogeymen and their legion hordes—from babies being thrown out of incubators in Iraq’s 1990 invasion of Kuwait to bin Laden’s alleged 9/11 attacks, Saddam Hussein’s weapons of mass destruction, and Muammar Gaddafi’s fabricated “crackdown” on his people—the public should well understand that much of corporate news media merely function as a well-oiled propaganda machine where “special interests” pull the strings. This is particularly the case when the true powers that be seek to undermine sovereign governments and carry out programs of wholesale terrorism and destruction against their populations.

Notes

[1] Charlie Skelton, “The Syrian Opposition: Who’s Doing the Talking?” Guardian, July 12, 2012.

[2] “Aleppo Bombings Kill 23, Activists Say,” Anadolu Agency, February 8, 2014.

[3] Anne Barnard and Mohammad Ghannam, “Dozens Are Killed in Syrian Violence, Even Amid Preparations for Peace Talks,” New York Times, December 23, 2013, 12.

[4] “Activists: Syrian Forces Launch New Aleppo Strikes,” Associated Press / Washington Post, February 1, 2014.

[5] Skelton, “The Syrian Opposition”; “Coventry: An Unlikely Home to Prominent Syria Activist,” Reuters, December 8, 2011.

[6] A search including the past tense phrases “activists said” or “activists reported” would have likely retrieved an even larger sample.

CSEC Headquarters’ $1.2-Billion Price Tag Has Activists Outraged

CSEC Headquarters’ $1.2-Billion Price Tag Has Activists Outraged.

CSEC

When the Harper government tables its latest budget Tuesday afternoon, it will include continued funding for a massive, opulent new headquarters for Canada’s electronic spy agency, CSEC.

The $1.2-billion building on Ottawa’s east side — dubbed the “spy palace” by critics and believed to be the most expensive government building ever constructed in Canada — has become a rallying point for activists protesting in the wake of allegations that CSEC has been spying on Canadians, in contravention of its mandate and possibly Canadian law.

More than 45 organizations, including OpenMedia, the Canadian Civil Liberties Association, Greenpeace and several unions, are launching a campaign Tuesday “to tell MPs to stop wasting billions on Canada’s expensive online spying apparatus,” according to a statement from OpenMedia.

It’s part of a multinational event, dubbed “The Day We Fight Back,” meant to launch a new, ongoing campaign to bring government surveillance under control.

In the U.S., the campaign will focus on revelations that the National Security Agency has been involved in mass, warrantless surveillance of Americans’ phone and internet activities.

In CSEC’s new headquarters, the Canadian activist groups see a potent symbol of the growth of the surveillance state in recent years.

We now have this dramatic, visual point of reference for CSEC — this grand piece of architecture rising in the east end — at a time when surveillance is becoming more and more of an issue,” Ian MacLeod, an Ottawa Citizen reporter who covers national security issues, explained to CBC Radio last fall.

Government estimates place the official cost of the new CSEC headquarters at $867 million, but according to a CBC investigation last fall, the building’s final cost will be closer to $1.2 billion. And when the $3-billion contract to operate the building for 20 years is added, the new HQ’s cost soars past $4 billion.

As the CBC noted, the building has more floor space than Toronto’s Air Canada Centre, and cost enough to build “several” large hospitals. It will house about 2,000 CSEC employees.

“Canadians are wasting billions of taxpayer dollars on a bloated spy bureaucracy that is monitoring our private lives,” OpenMedia.ca executive director Steve Anderson said in a statement.

“It’s time for common sense to prevail. We need to rein in CSEC and other security agencies before they get even more out of control. That’s why we’re calling on MPs to make a firm commitment to introduce pro-privacy legislation to protect the privacy of all residents of Canada.”

Documents from Edward Snowden’s trove of NSA data indicate that CSEC spied on Canadian travelers through WiFi hot spots at a major airport. The Harper government denies that the privacy of Canadians was invaded in the experiment, but privacy experts say the metadata collected by the CSEC would have exposed a great deal of private information about the targeted individuals.

The CSEC headquarters is being developed by Plenary Group Canada, an infrastructure company that specializes in government projects. The building is expected to be completed this year. Plenary Group boasts of the building’s innovative green technologies.

Walls of windows fill the facility with natural light and reduce the building’s electricity consumption and rainwater collection ponds reduce the facility’s consumption of water for irrigation,” the company’s fact sheet reads.

In an interview with CBC, former CSEC head John Adams admitted the building didn’t need to be an “architectural wonder.”

“But, you know, glass in this [CBC] building is the same price as glass in that [CSEC] building,” he said. “That building is just going to look an awful lot better than this building … That facility is going to be quite magnificent.”

Is it worth $1.2 billion to build a “magnificent” headquarters for Canada’s electronic spy agency? Let us know in the comments below.

Tory MP: Trudeau Can Pry Guns From My ‘Cold, Dead Hands’

Tory MP: Trudeau Can Pry Guns From My ‘Cold, Dead Hands’.

Blaine Calkins

CP
Conservative MP Blaine Calkins believes the Trudeau Liberals want to take away his firearms. (CP)

Conservative MP Blaine Calkins believes the Trudeau Liberals want to take away his firearms.

And to that, the Alberta native says they must pry them from his “cold, dead hands.”

Calkins rose in the House during members’ statements on Monday to highlight that Liberals will debate a resolution at their biennial convention later this month calling on any future Grit governments to reduce the number of firearms in Canada.

And to Calkins, who represents the Alberta riding of Wetaskiwin, that means Liberals already have a “plan to confiscate rifles and shotguns from law-abiding Canadian firearms owners.”

Calkins said Liberals have not moved beyond when former justice minister Allan Rock said only cops and the military should possess firearms.

“If the Liberal leader wants my guns, he can pry them from my cold, dead hands,” he said to great applause.

The reference will remind many of Charlton Heston’s famous speech to the National Rifle Association convention in 2000.

There are more than 160 different policy resolutions that will be debated by Grit delegates at the convention, dealing with everything from democratic reform and drinking water to veterans issues and fracking.

The resolution Calkins referenced, “Fewer Guns, Less Violence,” has been put forward by the Young Liberals of Canada. It says nothing specific about confiscating legal firearms.

WHEREAS evidence demonstrates a clear relationship between the number of firearms in a society and the number of firearm-related homicides and suicides;WHEREAS gun violence in our urban and suburban centres remains a significant threat to public safety;

WHEREAS incidents of firearm-related crimes, deaths and injuries decrease when access to firearms is combined with effective policies that keep firearms out of the hands of those who would use them to for such purposes;

WHEREAS the Australian Conservative government of John Howard successfully reduced the number of firearms in that country through proactive initiatives such as gun buybacks which led to decreases in the rates of firearm-related crimes, homicides and suicides;

BE IT RESOLVED that the primary objective of a Liberal government firearms policy shall be reducing the number of firearms in Canada through initiatives inspired by the Australian model.

The policy proposal has already generated discussion and debate on the Liberal website.

Former Australian Prime Minister John Howard brought in major gun reforms in 1996 after a massacre in which 35 people were killed. 

In a column published in The New York Times last year, Howard elaborated on how he worked to ban automatic and semiautomatic weapons and how his government bought back — then destroyed — about 700,000 guns from Australians.

Calkins’ remarks came as Conservative MP Rob Anders faces criticism for posing at a shooting range over the weekend in front of a target that depicts Osama bin Laden.

The chairman of the Muslim Council of Calgary told the Calgary Herald that the image portrays Muslims as terrorists “who should be short or belittled.”

Dani Rodrik reviews the fundamental lessons about emerging economies that economists have refused to learn. – Project Syndicate

Dani Rodrik reviews the fundamental lessons about emerging economies that economists have refused to learn. – Project Syndicate.

Death by Finance

PRINCETON – How quickly emerging markets’ fortunes have turned. Not long ago, they were touted as the salvation of the world economy – the dynamic engines of growth that would take over as the economies of the United States and Europe sputtered. Economists at Citigroup, McKinsey, PricewaterhouseCoopers, and elsewhere were predicting an era of broad and sustained growth from Asia to Africa.

But now the emerging-market blues are back. The beating that these countries’ currencies have taken as the US Federal Reserve begins to tighten monetary policy is just the start; everywhere one looks, it seems, there are deep-seated problems.

Argentina and Venezuela have run out of heterodox policy tricks. Brazil and India need new growth models. Turkey and Thailand are mired in political crises that reflect long-simmering domestic conflicts. In Africa, concern is mounting about the lack of structural change and industrialization. And the main question concerning China is whether its economic slowdown will take the form of a soft or hard landing.

This is not the first time that developing countries have been hit hard by abrupt mood swings in global financial markets. The surprise is that we are surprised. Economists, in particular, should have learned a few fundamental lessons long ago.

First, emerging-market hype is just that. Economic miracles rarely occur, and for good reason. Governments that can intervene massively to restructure and diversify the economy, while preventing the state from becoming a mechanism of corruption and rent-seeking, are the exception. China and (in their heyday) South Korea, Taiwan, Japan, and a few others had such governments; but the rapid industrialization that they engineered has eluded most of Latin America, the Middle East, Africa, and South Asia.

Instead, emerging markets’ growth over the last two decades was based on a fortuitous (and temporary) set of external circumstances: high commodity prices, low interest rates, and seemingly endless buckets of foreign finance. Improved macroeconomic policy and overall governance helped, too, but these are growth enablers, not growth triggers.

Second, financial globalization has been greatly oversold. Openness to capital flows was supposed to boost domestic investment and reduce macroeconomic volatility. Instead, it has accomplished pretty much the opposite.

We have long known that portfolio and short-term inflows fuel consumption booms and real-estate bubbles, with disastrous consequences when market sentiment inevitably sours and finance dries up. Governments that enjoyed the rollercoaster ride on the way up should not have been surprised by the plunge that inevitably follows.

Third, floating exchange rates are flawed shock absorbers. In theory, market-determined currency values are supposed to isolate the domestic economy from the vagaries of international finance, rising when money floods in and falling when the flows are reversed. In reality, few economies can bear the requisite currency alignments without pain.

Sharp currency revaluations wreak havoc on a country’s international competitiveness. And rapid depreciations are a central bank’s nightmare, given the inflationary consequences. Floating exchange rates may moderate the adjustment difficulties, but they do not eliminate them.

Fourth, faith in global economic-policy coordination is misplaced. America’s fiscal and monetary policies, for example, will always be driven by domestic considerations first (if not second and third as well). And European countries can barely look after their own common interests, let alone the world’s. It is naïve for emerging-market governments to expect major financial centers to adjust their policies in response to economic conditions elsewhere.

For the most part, that is not a bad thing. The Fed’s huge monthly purchases of long-term assets – so-called quantitative easing – have benefited the world as a whole by propping up demand and economic activity in the US. Without QE, which the Fed is now gradually tapering, world trade would have taken a much bigger hit. Similarly, the rest of the world will benefit when Europeans are able to get their policies right and boost their economies.

The rest is in the hands of officials in the developing world. They must resist the temptation to binge on foreign finance when it is cheap and plentiful. In the midst of a foreign-capital bonanza, stagnant levels of private investment in tradable goods are a particularly powerful danger signal that no amount of government mythmaking should be allowed to override. Officials face a simple choice: maintain strong prudential controls on capital flows, or be prepared to invest a large share of resources in self-insurance by accumulating large foreign reserves.

The deeper problem lies with the excessive financialization of the global economy that has occurred since the 1990’s. The policy dilemmas that have resulted – rising inequality, greater volatility, reduced room to manage the real economy – will continue to preoccupy policymakers in the decades ahead.

It is true, but unhelpful, to say that governments have only themselves to blame for having recklessly rushed into this wild ride. It is now time to think about how the world can create a saner balance between finance and the real economy.

Read more at http://www.project-syndicate.org/commentary/dani-rodrik-reviews-the-fundamental-lessons-about-emerging-economies-that-economists-have-refused-to-learn#bwUevcSjVlZBMS5W.99

Another Fed “Taper” Casualty: Kazakhstan Devalues Currency To Weakest On Record | Zero Hedge

Another Fed “Taper” Casualty: Kazakhstan Devalues Currency To Weakest On Record | Zero Hedge.

With only $24.5 billion left in FX reserves after valiantly defending major capital outflows since the Fed’s Taper announcement, the Kazakhstan central bank has devalued the currency (Tenge) by 19% – its largest adjustment since 2009. At 185 KZT to the USD, this is the weakest the currency has ever been as the central bank cites weakness in the Russian Ruble and “speculation” against its currency as drivers of the outflows (which will be “exhausted” by this devaluation according to the bank). The new level will improve the country’s competitiveness (they are potassium heavy) but one wonders whether, unless Yellen folds whether it will help the outflows at all. The Kazakhstan stock index is up 12% on the news…

Via Bloomberg,

The tenge, introduced in 1993 after the breakup of the Soviet Union two years earlier, weakened the most against the dollar last month since July. Kazakhstan devalued its currency by 21 percent in February 2009, as the biggest energy producer in central Asia spent billions of dollars to support the economy and bail out its biggest lenders following the collapse of Lehman Brothers Holdings Inc.

The devaluation was a surprise for many people, considering the central bank’s assurances that the exchange rate is stable,” Damir Seisebayev, director of the analytical department at ?? Private Asset Management in Almaty, said by e-mail. “But you have to be realistic. What is the tenge? It’s the ruble rate multiplied by five. This is a tested formula.”

The Kazakhstan Stock Exchange gained 12 percent after the announcement, data on the bourse’s website show.

So it must be great news, right? Just as Venezuelan stock holders…

The move reflects a combination of factors, including the steady deterioration in the current-account position, worries over the impact of weak growth in Russia and the ruble’s managed depreciation,” Tim Ash, chief emerging-markets economist at Standard Bank Group Plc. in London, said in a note today.

Another Conspiracy Theory Becomes Fact: Meet The Men With The Plan Behind Italy’s Bloodless Coup | Zero Hedge

Another Conspiracy Theory Becomes Fact: Meet The Men With The Plan Behind Italy’s Bloodless Coup | Zero Hedge.

The chart below is very familiar to anyone who was observing the hourly turmoil in the European bond market in November of 2011, when Italian bonds crashed, when yields soared to record levels, and every downtick of the Euro could have been its last.

What the chart may not show are the dramatic transformations in Italy’s government that took place just as the Italian bond spread exploded, which saw the resignation of career-politician Sylvio Berlusconi literally days after yields soared, and the instatement of Goldman technocrat Mario Monti as Italy’s next Prime Minister.

In fact as some, and certainly this website, had suggested the blow out in Italian yields was merely a grand plan orchestrated to usher in a new Italian government that would, with the support of yet another Goldman alum, the ECB’s then brand new head Mario Draghi, unleash a new era in Italian life, supposedly one of austerity (ignoring that two years after Berlusconi, Italy’s debt to GDP ratio has never been higher), and which would give the impression that Europe is being fixed all the while preserving the broken European monetary system for at least another year or two. In other words a grand conspiracy theory of a pre-planned bloodless coup. That all this would take place under the auspices and with the blessing of Italy’s president Napolitano, only made things worse since Italy is not a parliamentary republic but a parliamentary democracy, where such cloak and dagger arrangements are certainly not permitted under the constitution.

And so, as lately so often happens, courtesy of the narrative by Alan Friedman of what really happened that summer, this too conspiracy theory has just become conspiracy fact. Thanks to the FT’s “Monti’s secret summer“, we learn with painful detail (especially for those of our readers who may be Italian), just how the grand conspiracy to out Berlusconi took shape, and how it was deviously executed with the assistance of none other than the European Central Bank.

It all started on In the summer of 2011 when Carlo De Benedetti, the Italian industrial tycoon, hosted Mario Monti, Italy’s then former prime minister and an old friend of De Benedetti’s in the St Moritz-based alpine retreat of the industrialist for dinner, and a private chat to discuss “a development that was to have profound public consequences.” We go to the FT for the full details:

“Mario asked if we could get together, and I chose a typical little Swiss trattoria for dinner, just outside of St Moritz. But at the last minute he said he wanted to talk in private and so I said ‘Sure, stop by my house before dinner’ and so he came by,” Mr De Benedetti says. “And it was then he told me that it was possible that the president of the republic, Napolitano, would ask him to become prime minister, and he asked my advice.

Mr De Benedetti says the two men “discussed whether he should accept the offer, and when would be the right moment to do so. This happened at my house in August, so in fact he had already spoken with President Napolitano.”

The offer from Giorgio Napolitano, the Italian president, to Mr Monti of the job of prime minister – a post that was still very much occupied by Silvio Berlusconi, the billionaire centre-right politician – is at the core of serious questions of legitimacy in Italy. What happened in Italy that summer and autumn as policy makers battled the crisis gripping the eurozone is still a subject of intense debate.

Here, the story takes a detour to a glimpse of the denouement, by advising readers that the president’s “planning the replacement of the elected Mr Berlusconi by the unelected technocrat Mr Monti – months ahead of the eventual transfer of power in November – reinforces concerns about Mr Napolitano’s repeated and forceful interventions in politics. His outsized role since the crisis has led many to question whether he stretched his constitutional powers to their limits – or even beyond.” Of course, he did – and so did all other European bankers and business tycoons who knew they had to perpetuate the legacy status quo as long as possible or else their fortunes would come crumbling down before their eyes. But we already knew that. What we did not know were the explicit details of how the immaculate plan to wrest control of Italy from the playboy billionaire and hand it over to what essentially were Goldman’s key European tentacles, were conceived. So we read on:

Outside the calm of St Moritz that summer, the eurozone crisis was raging. Market speculation against Italian and Spanish sovereign debt was rampant and the spread between Italian Treasury bonds and German Bunds was rocketing. As its borrowing costs rose there was talk that Italy could default. Italy was in crisis – politically as well as economically.

In Rome, Mr Berlusconi was presiding over a rancorous, unstable coalition and increasingly distracted by allegations over sexual relations with Karim el-Mahroug, a Moroccan nightclub dancer. All of Europe seemed to be lambasting him.

Yet despite the controversy engulfing Mr Berlusconi, he was still the sitting prime minister and his government was legitimate under the rules of Italy’s parliamentary democracy.

How long that might last was a subject of conversation between Mr De Benedetti and Mr Monti that August.

“I told Mario that he should take the job but that it was all a question of timing. If Napolitano formalised the offer in September then that was fine, but if he left it until December then it would be too late,” recounts Mr De Benedetti.

So now we know the timeframe for the upcoming coup: ideally sometime, in October or November of 2011. But before that, it was the turn of another element – this time the European connection Romano Prodi – to give his blessing and to explain to Monti why he would soon be the “happiest man alive:”

Romano Prodi, a former president of the European Commission and another old friend of Mr Monti’s, recalls a similar conversation, but even earlier, towards the end of June 2011. “We had a long and friendly conversation,” Mr Prodi says, “and he asked for my thoughts, and I told him, ‘look here Mario, there is nothing you can do to become prime minister but if the job is offered to you then you cannot say no. So you should be the happiest man alive’.”

Finally, the only missing link was the codification of the “reforms” that Italy would undergo the second Berlusconi was booted out.

Corrado Passera, a leading banker who was to become Mr Monti’s minister for economic development, infrastructure and transport, was meanwhile given the green light that summer by Mr Napolitano to prepare a confidential 196-page document containing his own proposals for a wide-ranging “shock therapy” for the Italian economy. It was a programme of proposed government policies and reforms that went through four successive drafts as Mr Napolitano and Mr Passera discussed it back and forth that summer and into the autumn.

With all that in place, it was time to put the plan into effect.

Italy’s crisis intensified throughout the autumn of 2011. All Italians still remember the smirk of scepticism on the faces of Angela Merkel, the German chancellor, and Nicolas Sarkozy, the French president, when they were asked at a press conference in October if they had confidence in Mr Berlusconi’s ability to cut the deficit or reduce the debt, which was then at 120 per cent of gross domestic product. (The latest figure is 133 per cent.)

So yes, for anyone still confused – since total debt/GDP has risen by 13% in the past two years, the last thing Italy engaged in was austerity designed to moderate its out of control public spending. What it did engage in, was epic capital misallocation, even greater corruption, and gross incompetence. All of these, however, were conveniently scapegoated on the only well-known traditional fallback.

At this point, we should remind readers of a concurrent story, one involving Italy’s then-member of the ECB executive council, Lorenzo Bini-Smaghi, who revealed in a recent book that at just around this time Berlusconi was realizing that the trap was closing. Bini-Smaghi revealed that Berlusconi had “discussed (threatened?) Italian withdrawal from the euro in private meetings with other EMU governments, presumably with Chancellor Angela Merkel and France’s Nicolas Sarkozy, since he does not negotiate with underlings.”

And so the ECB went to task, and under its new boss, yet another Italian, former Goldmanite Mario Draghi, allowed Italian bond yields to crater and take the country, and the Eurozone, and thus the entire developed world, to the edge of collapse. Just so Italy’s president had a pretext to accelerate the demise of Berlusconi and catalyze his replacement with a technocrat crony of the financial establishment. Once again, as a reminder, here is the dynamic of bond yields soaring just as Berlusconi was threatening to end the European dream in which “so much political capital is invested”:

What happened after that moment is part of the public record:

On November 9 2011 Mr Napolitano appointed Mr Monti a senator for life, thus making him a member of parliament. On November 12, at a meeting with the president, Mr Berlusconi resigned, ending his third stint as prime minister. Within 24 hours – rather than call for fresh elections – Mr Napolitano named Mr Monti, the economics professor and former European commissioner who had never held elected office, as prime minister. The full cabinet was sworn in three days later.

Mr Berlusconi’s supporters cried foul and made noisy claims that there had been a “coup”.

They were right, and now – from the horse’s mouth – we know the facts.

In a lengthy videotaped interview with Mr Monti, he confirmed the conversation with Mr De Benedetti in St Moritz. He also acknowledged the conversation with Mr Prodi in June 2011, though at first he played down these talks, saying that the idea of him becoming prime minister “was sort of in the air”.

He recalled with a giggle that “Yes, Prodi came to see me at the end of June and the spread [between Italian and German government bond yields] was then about 220 or 250 basis points, and he told me: ‘Get ready, because when the spread hits 300 you will be called in’. And then the spread hit 550!”

… as if by magic. Supposedly Draghi wasn’t quite willing to do “whatever it takes” just yet.

Mr Monti confirmed that he knew all about the Passera document being prepared for the president. “Corrado Passera told me he was working on this and he said he would show it to me, and he did, and he told me he had given it to Napolitano and would give it to me,” Mr Monti said. “And on one occasion I discussed the Passera document with Napolitano, and then later on, months later, when I was named prime minister, I immediately asked Passera to join the Cabinet.”

But when asked if it was made clear to him in the summer of 2011 in his talks with Mr Napolitano that the president was asking him to be ready to take over from Mr Berlusconi, Mr Monti hesitated. “Well, President Napolitano and I had been talking for a long time, for years, not about this, but then things sort of came to a head.”

When pressed further to explain if Mr Napolitano had explicitly asked him to be on standby during their talks back in June and July 2011 – four to five months before he replaced Mr Berlusconi as prime minister – Mr Monti demurred: “Look here: I will not reveal details of conversations that I had with the president of the republic.”

Pressed again, and asked if he wished to deny on the record that in June and July of 2011 President Napolitano had either asked him explicitly or had made it clear that he wanted him to be available to become the new prime minister, Mr Monti replied falteringly, in a voice that became almost a whisper: “Yes. He, uh, he gave me a signal in that direction.” After this revelation a look of extreme discomfort spread across Mr Monti’s face and he stared off to one side.

Perhaps because Monti had just realized he admitted that Italy had undergone presidentially-blessed government coup – one whose execution stretched far beyond any constitutional powers awarded to the president, and one which involved numerous foreign (and financial) interests (and conflicts thereof).

At this point attention turns to Italy’s president, 89-year old Giorgio Napolitan0, whose direct intervention was instrumental in allowing this carefully laid “bloodless coup” plan of bankers and technocrats to proceed:

Mr Napolitano did not agree to an interview despite repeated requests. His spokesman had no comment on a series of written questions, including one about which month in 2011 Mr Napolitano had first sounded out Mr Monti to become prime minister.

But last week Mr Napolitano commented for the first time on the controversy over his naming of Mr Monti. During a visit to the European parliament in Strasbourg, Mr Napolitano said that while some had described his naming of Mr Monti “as almost invented by me as a personal whim”, in fact he had done so on the basis of indications given to him by parliamentary and political leaders “in the course of consultations as is required”.

This explanation could raise further questions in Italy, where such “consultations as is required” would typically have begun only upon the resignation of the prime minister. In Mr Berlusconi’s case, these would have begun upon his November 12 resignation.

We now know that all such consultations took place well before said resignation. But where it gets better is just how grand the chess game truly was:

The Monti government acted swiftly to introduce harsh austerity measures, spending cuts, a value added tax rise and new property duties as well as reform of the pensions system. Praise was duly heaped on him by the European Commission, the International Monetary Fund and financial markets.

Many Italians still despise Mr Monti for the austerity programme and see him as a pawn of the European Commission or of Ms Merkel. In retrospect he lacked a political touch but was a useful transition figure at a time of crisis.

Mr Monti says his greatest achievement was to jump into electoral politics during the election of February 2013 at the expense of Berlusconi’s party. “Had it not been for my taking votes away from the centre-right,” Mr Monti said in the interview, “Berlusconi today would be either the president of the republic or the prime minister, so I did achieve a concrete result in blocking that.”

Of course, Berlusconi’s star has now faded, and with it the danger that the supposedly irrational politician, who once had threatened to dissolve the Eurozone and thus saddle Germany with a TARGET2 bill amounting to almost $1 trillion. Which meant that the status quo of the “equity tranche” (read – the global banker aristocracy) had been preserved. In this way, Napolitano, Prodi and Monti, assisted by their fourth Italian friend – ECB’s Mario Draghi – effectively subjugated the Italian population to call it austerity, call it gross and premeditated capital misallocation, but certainly call it the will of the bankers. And all without firing a shot.

Which brings up the question of just how constitutional, if at all, was the overthrow of Berlusconi.

Adopted in 1948 after more than 20 years of chaos and brutal fascist rule, Italy’s constitution is one of the few documents universally respected by Italians. It guarantees their most basic rights. It is sacrosanct.

Planning in secret, even as a contingency measure, to appoint a new prime minister when a parliamentary majority is in place may be a prudent and responsible action for a president but it is not an explicit power assigned by the constitution, even if there is a financial crisis under way in half of Europe as was the case in the summer of 2011.

Most ironic, however, is that the only person who seems to care about the trampling of the constitution is…  a former comedian.

Whatever one thinks of Mr Berlusconi, serious constitutional questions are raised by the behind-the-scenes manoeuvring that resulted in the appointment of his successor. Perhaps the loudest voice to raise these questions is that of Beppe Grillo, the comedian-turned-politician who garnered 25 per cent of the national vote last year.

Mr Napolitano, an 89-year-old former communist, has reacted with anger at Mr Grillo’s incessant accusations of the subversion of democracy. Mr Grillo has frequently called for Mr Napolitano’s impeachment.

Today, Italy is emerging from recession slowly, with an exceedingly weak and uneven economic recovery. This year is expected to bring less than 1 per cent growth in GDP. 

Italy remains sharply divided over the events of 2011 and Mr Napolitano’s role in them. The issue of whether Mr Napolitano went beyond his constitutional powers during the summer and autumn of 2011 can be left to future historians. But what is clear now – thanks to Mr Monti’s own admission – is that he and the president had been discussing the prospect of his taking over from Mr Berlusconi long before his official appointment in November of 2011. For Mario Monti it had been a long and secret summer.

Indeed it had. And now we know that in order to effectuate the banker plan of preserving Europe’s “political capital” which is simply another name of trillions in wealth on paper (and on funny-colored pieces of European currency) that would evaporate if and when the Eurozone inevitably dissolves, it took just four Italians – Monti, Prodi, Napolitano and, of course, Draghi – willing to trample their constitution in order to achieve the goal of perpetuating the status quo no matter the cost.

As for the fallout, namely “youth unemployment is at a record high of 41.6 per cent, nationwide joblessness is 12.7 per cent and almost a third of families are near the poverty line. Productivity and competitiveness have dropped sharply in recent years. Mr Monti’s successor, Enrico Letta, another leader championed by Mr Napolitano, is under fire for his handling of the economy”… well, all those are problems of the “99%”. And as everyone knows by know, the 99% is the last thing on the mind of the global ruling class.

Is a Policy a Law? Is Murder Murder? Washington’s Blog

Is a Policy a Law? Is Murder Murder? Washington’s Blog.

From the Associated Press:

“An American citizen who is a member of al-Qaida is actively planning attacks against Americans overseas, U.S. officials say, and the Obama administration is wrestling with whether to kill him with a drone strike and how to do so legally under its new stricter targeting policy issued last year.”

Notice those words: “legally” and “policy.”  No longer does U.S. media make a distinction between the two.  Under George W. Bush, detention without trial, torture, murder, warrantless spying, and secret missile strikes were illegal.  Under Obama they are policy.  And policy makes them “legal” under the modified Nixonian understanding that if the President does it as a policy then it is legal.

Under the U.S. Constitution, the laws of the nations in which drone murders take place, treaties to which the U.S. is party, international law, and U.S. statutory law, murdering people remains illegal, despite being policy, just as it was illegal under the less strict policy of some months back.  The policy was made stricter in order to bring it into closer compliance with the law, of course — though it comes nowhere close — and yet the previous policy remains somehow “legal,” too, despite having not been strict enough.

Under that previous policy, thousands of people, including at least four U.S. citizens, have been blown to bits with missiles. President Obama gave a speech last year in which he attempted to justify one of those four U.S. deaths on the basis of evidence he claimed to have but would not reveal. He made no attempt to justify the other three.

The new policy remains that the president can murder anyone, anywhere, along with whoever is near them, but must express angst if the person targeted is a U.S. citizen.

The idea that such lunacy can have anything to do with law is facilitated by human rights groups’ and the United Nations’ and international lawyers’ deference to the White House, which has been carried to the extreme of establishing a consensus that we cannot know whether a drone murder was legal or not unless the president reveals his reasoning, intention, motivation, and the details of the particular murder.

No other possible criminal receives this treatment. When the police read you your rights, you are not entitled to object: “Put those handcuffs away, sir! I have a written policy justifying everything I did, and I refuse to show it to you. Therefore you have no grounds to know for certain that my justification is as insane and twisted as you might imagine it to be based merely on what I’ve done! Away with you, sir!”

The loss of a coherent conception of law is a grievous one, but that’s not all that’s at stake here.

Numerous top U.S. officials routinely admit that our drone wars in the Middle East and Africa are creating more enemies than they kill.  General Stanley McChrystal, then commander of U.S. and NATO forces in Afghanistan said in June 2010 that “for every innocent person you kill, you create 10 new enemies.” Veterans of U.S. kill teams in Iraq and Afghanistan interviewed in Jeremy Scahill’s book and film Dirty Wars said that whenever they worked their way through a list of people to kill, they were handed a larger list; the list grew as a result of working their way through it.  The wars on Iraq and Afghanistan, and the abuses of prisoners during them, became major recruiting tools for anti-U.S. terrorism. In 2006, U.S. intelligence agencies produced a National Intelligence Estimate that reached just that conclusion.

We are shredding the very concept of the rule of law in order to pursue a policy that endangers us, even as it helps to justify the erosion of our civil liberties, to damage the natural environment, and toimpoverish us, as it kills many innocent people.  Maybe they’ve secretly got drones doing the thinking as well as the killing.

Peak oil isn’t dead; it just smells that way – SmartPlanet

Peak oil isn’t dead; it just smells that way – SmartPlanet.

Energy analyst Chris Nelder fires back at the latest fact-free commentary on peak oil.

The Oil Drum, a Web site dedicated to informed discussions about peak oil and energy, announced on July 3 that it is closing down. (For a brief primer on peak oil, see my conversation with Brad Plumer in theWashington Post.) Those who hate the peak oil story didn’t bother to conceal their glee at the news; some even saw occasion to claim victory for their side in the “debate” over the future of fossil fuels.

“We could say ‘I told you so,’ not as a school-yard epithet, but simply as a fact,” crowed Mark Mills, co-author of a lightweight book entitled The Bottomless Well, which Publishers Weekly described as “Long on Nietzschean bombast but short on some crucial specifics.”

David Blackmon, a Houston-based consultant with a 33-year career in the oil and gas industry who is one of Forbes’ 1,300 advertorial “contributors,” called The Oil Drum “a site devoted a theory based on lack of imagination and growing irrelevance” in his mouthful of nuts.

Economist Karl Smith, another Forbes contributor, scoffed at the crucial distinction between crude oil and “all liquids” in his confusing word salad, asserting that “liquids like butane, propane and ethane are important petroleum products” without explaining why he believes they should be counted as crude oil, when they are not.

Emboldened by the recent exuberance over fracking in the United States, these pundits now claim that the only thing that has peaked “was the ability to argue that the era of oil, and hydrocarbons, was over.”

Not one of them said a single word about the global rate of oil production, which is the essence of the peak oil question. Why get into the data when merely slinging mud at your opponents and proclaiming your faith will do?

A handful of other writers offered less ideological takes. Matt Yglesias confessed that he “always found the ‘Peak Oil’ debate to be a little bit confusing” but recognized that there has been a profound price revolution: “The good old days of genuinely abundant liquid fuel really do appear to be behind us,” he wrote. Noah Smith had the most informed post of the bunch, noting that the transition to unconventional oil is a big part of why prices have been rising, and that “there is no substitute on the horizon” for good ol’ crude.

But neither of them mentioned the rate of oil production either.

Keith Kloor borrowed an Energy Information Administration (EIA) chart of U.S. production from aBBC article that repeated all the industry’s favorite talking points about how new technology has produced “a new oil rush.” Apparently, neither Kloor nor the BBC author realized that the chart represented “all liquids” production in the United States, not just crude oil, nor bothered to explore the detailed EIA data for themselves, nor tried to explain how this recent boom in U.S. production might dismiss the specter of a global peak. Kloor concluded that The Oil Drum was closing because “the numbers aren’t in your favor right now.” But like the others, he didn’t actually mention any numbers.

In short, all of these authors used The Oil Drum news to comment on the debate about peak oil — the poor predictions and demagoguing and pollyannish posturing and name-calling, which have, truth be told, tainted both sides of the issue — but none of them discussed peak oil.

I really didn’t think I’d have to say this again, but peak oil is about data, and specifically data about the production rate of oil. If you want to claim that peak oil is dead (or alive), you have to talk about data on production rates. There is no other way to discuss it.

Just for the record

Then what’s really going on here?

First, what did in The Oil Drum was volunteer burnout, falling visitor traffic, and an insufficient flow of high-quality original work and contributors. It’s unfortunate, because for the past eight years The Oil Drum has been the best free site on the Web for good rigorous work and informed discussion about energy data. I owe it a great debt for the education, the contacts, and the visibility that I gained through it.

I learned of its closing the same day I learned that Randy Udall had died. It was truly a sad and dark day for the peakists, one of those watershed moments that felt like a real turning point in the peak oil dialogue. Using the occasion to dance on their graves, as some ardent peak oil opponents did, was a low blow.

But the reason The Oil Drum has been lacking for good original content wasn’t that it had lost the argument and there wasn’t anything left to say. Far from it. The flow of content simply moved to where good analysts and writers on the subject could actually get paid for their work. That was inevitable, because a publishing model that relies on a steady flow of free articles that take days or weeks or even months of hard, highly skilled work to create simply isn’t sustainable. Freelance writers like me moved on to paying publications like SmartPlanet where we could actually make a living. Consultants and hedge funds began restricting their work to their private clients and subscribers, with maybe a teaser of free stuff posted in their blogs and newsletters. Investors and oil and gas companies began hiring capable analysts to do the work privately, after many years of enjoying the assembled intelligence on The Oil Drum (and trading it very profitably, I might add) for free. The volunteers who had put so much time into the site all these years discovered that they needed to spend their energies elsewhere. And the public got accustomed to higher prices, so the media stopped talking about peak oil, which led to a dropoff in traffic. Hey, that’s show biz.

It’s also true that many of us, having cut our teeth on the data and the dialogue at The Oil Drum, moved on to other pursuits. Once you’ve learned something, you don’t need to keep relearning it. Just speaking for myself, I moved on to grappling with the solutions to the peak oil problem: efficiency upgrades, financing, policy issues, transportation paradigms, and the transition to renewables. Merely revisiting the peak oil problem didn’t seem like a good use of my time, though I have continued to write about it as a context. I know that some other former contributors to the site changed their tacks similarly.

Second, fracking mania has been fairly well confined to the United States, because that’s where it is happening. Get outside the States for awhile, as I have done this year, and you quickly discover thatpeople are still worried about the future of oil and gas. Probably because their oil and gas prices haven’t gone down, and their reserves haven’t gone up. There is absolutely no evidence that fracking will produce significant volumes of oil outside the United States any time soon.

Third — and I know this is gonna hurt a few writers out there, but it has to be said — very few people who have written about peak oil outside of sites like The Oil Drum ever did the hard study required to really understand it. They just picked a side, usually on tribal or ideological grounds, and commenced to defend that. Many of them don’t have a clue, even now, what the difference is between, say, proved reserves and resources, or what a reserves to production ratio is, or what a P50 estimate actually represents, or the production costs and energy content of non-crude liquids. Not a clue. I’d be willing to bet that 95 percent of them have never even built a spreadsheet of oil and gas data and tried to analyze it.

Most of what you’ve read about peak oil in the broader press has been written by generalist journalists. It’s an insanely complex topic that really takes thousands of hours of study to understand. But most of them haven’t done that study, and much of what they write is wrong. Usually they just rewrite the summary of a long and technical report written by someone in the industry. They don’t read the whole thing; they don’t have the time, or they may not have the chops to understand it. They don’t do original analysis or fact-checking. And too often they don’t seem to understand the context of the data, so they don’t give you any. What does 7, or 19, or 91 million barrels a day mean to the average person? Nothing. So they don’t talk about it. But they can certainly write the hundredth variation of a story about incipient U.S. “energy independence” and how that will overturn geopolitics, blah blah blah, while playing into the mythos of American exceptionalism, without understanding the data.

Likewise, it’s easy to speculate that the solution du jour — ethanolbiofuels from algae, the ‘hydrogen economy’, space-based solar powerfuel cellsmethane hydrates, and so on — will save the day if you don’t actually dig into the data. Generalist journalists love to do that. Those articles generate lots of traffic and no one will ever hold them accountable for writing about a popular fantasy.

Actually, I’m being generous here by attributing their inattention to being generalists on tight deadlines. After a decade of this innumerate nonsense, I’ve begun to suspect either disinterest or laziness, or worse. Especially on the part of science and economics writers who clearly do have the chops to research and understand data. As Robert Bea, an expert who has studied some of the biggest civil engineering disasters in recent history, recently observed, failure is usually the result of hubris, shortsightedness, and indolence, not engineering. Our failure to prepare for peak oil is no different.

The only thing that most writers seem to have grasped is the hard reality of price. That’s easy enough; It’s published every day by a variety of agencies. A quick Google search will find it. It requires no study. Everybody cares about it. It’s cake. When prices are high, as they are now, those who only understand price look at it as evidence that the peak oil explanation has some merit. But price is fickle. When prices crashed into the $30s per barrel at the end of 2008, everybody was writing about how it was proof that the peak oil theory was wrong.

Those who do understand the technical aspects of the data are generally in the oil and gas industry. Most don’t talk about it because the data tells a story they don’t want told. So they try to divert the focus away from the data and onto the attitudes of the debaters. Or they just talk about the data that favors their point of view, like increasing technically recoverable resources and booming production in North Dakota and Texas. Most of the time, the ruse works.

So the tiresome “debate” about peak oil goes on, repeated as an endless Kabuki theatre of Malthusians vs. Cornucopians, ignoring the data in favor of another thousand words about attitudes and beliefs.

And in the middle, dear reader, is you. Caught between unwary and innumerate journalists on one side, and propaganda carefully constructed by those who are ‘talking their books’ on the other. Paying $4 a gallon for gasoline one day, then $2 six months later, then $4 again four years later. You don’t know why because the press never really explains it to you, the industry deliberately tries to confuse you, and politicians tell you whatever is needed to get your vote.

All I can say about that is: I’m sorry. It’s sad. I’ve been trying to get the facts out for years. It doesn’t seem to help.

The data

Now let’s talk about some data.

The world currently produces around 91 million barrels a day (mb/d) of ‘oil’ in the International Energy Agency’s definition, which is for all liquids. For the past two years, actual crude oil production (which includes lease condensate in the EIA’s definition) has been hovering around 75 mb/d on an annual basis, just slightly over the 74 mb/d plateau established in 2005.

The moment of truth for peak oil will be when the decline of mature fields finally overwhelms new production additions, and global supply begins to turn south. (A vogue alternative is that we’ll reach “peak demand” first, where oil is replaced by other fuels and demand falls due to greater efficiency, but as yet I find the proof that this has happened, or will happen, unconvincing.)

That moment of truth isn’t quite here yet. Fracking, along with all the other methods the world is employing to squeeze a bit more oil out of the earth, has barely budged global oil production. Here is the chart:

Chart: Peak Fish Data: EIA

What do you see there? An ignominious end to an unimaginative story perpetrated by self-interested mavericks looking to raise their profiles and sell some books, or a plateau of production that just barely broke higher in the past two years after an absolutely heroic effort that required hundreds of billions of dollars of investment and a quadrupling of oil prices?

Now let’s look at non-OPEC production, without U.S. production:

Source: Peak Fish

See how production has been falling off in recent years? That’s happening because the the aggregate decline rate of all fields is around 5 percent per year. In other words, the world loses around 3.0 to 3.8 mb/d of production each year (depending on whose numbers you use). Most of the 2 mb/d “tidal wave of oil” from U.S. fracking was absorbed by the decline in the rest of non-OPEC, as we can see from the aggregate non-OPEC production in this chart:

Source: Peak Fish

The question isn’t “Can fracking save the world from peak oil?” but “How long can America make up for declines in the rest of the world?” The answer is probably not much longer. The growth rate of tight oil production has cooled considerably over the past year, and per-well production is falling.

Now let’s look at U.S. production in isolation. Here’s the “all liquids” chart that Kloor reprinted, presumably without realizing that it wasn’t just for oil:

Looks great, right? Huge turnaround. We’re back to 1985 levels!

Now let’s look at the chart of actual U.S. crude and condensate production, without all the natural gas liquids and biofuels and refinery gains:

Source: EIA

Hey, what happened to that huge spike in production returning us to 1985 levels?

Now look at the article where I explained the difference between those numbers, and why the “all liquids” numbers overstates actual U.S. oil supply by about one-third. Do you still believe Karl Smith, who explained none of that and offered no data but simply asserted that “ ‘liquids’ is not a weaselly term” and that we should count all liquids equally “because the US Presidential Primaries begin in Iowa?”

A few more facts about U.S. oil, since there has been so much confusion disseminated about it in recent months: America consumes 19.5 mb/d of oil and produces 7.4 mb/d. On an annual basis through 2012 it was the world’s largest crude oil importer, but has probably been surpassed since by China on a monthly basis. It exports more refined products like gasoline and diesel than it imports, but that’s simply because it has a very large refining complex and falling domestic demand, not because it’s on its way to energy independence. The United States will never be a net oil exporter, nor will it surpass Saudi Arabia in oil production, no matter what you may have read about “Saudi America.”

Now let’s talk about price. Since 2003, who forecast the global repricing of oil best, the peakists who expected prices to spike into record territory, or the Cornucopians who consistently predicted that oil prices would return to historical levels? The answer is indisputable: the peakists.

For the past decade, the Cornucopians have told us that a new abundance was coming from deepwater oil, tar sands, enhanced oil recovery, biofuels, and other unconventional sources. Global oil production would rise to 120 million barrels per day, and prices would fall back to $20 or $30 per barrel. Those stories were all completely wrong. The peakists called it.

Here’s what happened: Oil repriced in response to scarcity. Triple-digit prices were responsible for the new flush of unconventional production. That production, including fracking for tight oil in the United States, raises prices, it doesn’t lower them. We’ve hit and fallen back from the consumer’s price tolerance repeatedly for the past six years.

For a last bit of data, look at this forecast from the final post that petroleum engineer Jean Lahèrrere did for The Oil Drum:

(I used another of Laherrère’s charts in my post from March.)*

Laherrère concludes: “With the poor data available today, it seems that world oil (all liquids) production will peak before 2020, Non-OPEC quite soon and OPEC around 2020. OPEC will cease to export crude oil before 2050.”

Looking closely at Laherrère’s data, it seems essentially in line with my view that in another 18 months or so we’re going to get the signal that oil needs to reprice higher still to maintain production. That will be very difficult for U.S. and European consumers to stomach. Whether that repricing will bring more oil to market, or simply kill demand, remains to be seen.

This is what the data — not beliefs or rhetoric — tell me.

What’s your bet?

So here’s what we know.

High value crude oil — the good stuff with 5.8 million BTU per barrel that we can make into diesel and gasoline and a million other things — has been generally holding on to a global production plateau since 2004. Global production will fall when the decline of mature fields overwhelms new additions. When, precisely, that will happen, no one can say for certain. But it’s almost definitely before 2020.

Most of the non-crude liquids are not equivalent to crude. Apart from tar sands and heavy oil, they contain less energy and are far less useful. Some of them can’t be made into gasoline and diesel. But with regular crude production trapped at around 75 million barrels a day, these other liquids must meet all future increases in demand for oil. As they take an increasing share of the liquid fuel market, they gradually increase the price of “oil.” Nothing on the horizon will change that.

Eventually, the price will become too high, and we’ll have “peak demand” alright, but it will be primarily because of price, not efficiency gains, and will lead to economic contraction, not growth. That price will owe to increasingly marginal and difficult — hence, expensive — prospects. In that sense, it’s a supply side problem, a concept at the heart of peak oil. Is it clear now why the “peak demand” vs. “peak supply” argument isn’t really that interesting?

If U.S. consumers are able to tolerate, say, $5-7 a gallon for gasoline by 2020, then it’s possible that the production plateau could extend a bit farther, and my expectation that global supply will begin to slip around 2015 could be wrong. It won’t be off by much, and in the grand scheme of what it means for the global economy, a year or three plus or minus is essentially irrelevant. But if I am off by even six months, you can be sure that my detractors will come out of the woodwork to say I’m all wet, and that production is going to da moon.

But my bet is that U.S. and European consumers can’t tolerate significantly higher prices. Price tolerance is something that Cornucopians never talk about, so you won’t hear that argument from them. If I am correct on that point, then production will have to decline as prices become intolerable. By virtue of its upward pressure on price, unconventional oil production contributes to, not cures, peak oil.

I expect world oil production to rise, weakly, for another two years or so, as America falls into a deeper slumber believing that fracking has cured everything. The media will reinforce that belief. And when it comes, the wake-up call is going to be harsh. In the meantime we’re just going to be waiting for the punchline.

So to those who can grasp the data, here’s my final thought: How will you prepare yourself for The Great Contraction? You’ve got perhaps two good years left of business as usual, and maybe another three or four after that before things really get difficult. I encourage you to use them well, and do what you can to make yourself resilient and self-sufficient. What will you do 10 years from now if the price of gasoline is $10 a gallon?

Yes, we do need to have a serious talk about our values, hopes, beliefs, mythologies, and ambitions; about the embedded growth paradigm, the debt overhang, and economic theory in an age of diminishing marginal returns. Those are all important discussions. But let’s have them after we understand the facts about energy. Not before.

Whatever you do, don’t think that peak oil is dead just because some guy who doesn’t know what he’s talking about said so in a fact-free blog post. It’s coming. Later than some thought, but sooner than you think.

Photo: Mark Rain (AZRainman/Flickr)

*Correction July 25, 2013: In the original version of this post, I said that Laherrère’s chart “leaves out extra-heavy oil volumes which may or may not materialize from Venezuela and Canada.” Laherrère responded that this chart does in fact include those heavy oil volumes. The text has been corrected accordingly. — CN

Jul 23, 2013

Chris Nelder

Columnist (Energy)Chris Nelder is an energy analyst and consultant who has written about energy and investing for more than a decade. He is the author of two books on energy and investing, Profit from the Peak and Investing in Renewable Energy, and has appeared on BBC TV, Fox Business, CNN national radio, Australian Broadcasting Corp., CBS radio and France 24. He is based in California. Follow him on Twitter. Disclosure
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