Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Time to take the RED Pill - 28th May 24
US Economy Slowing Slipping into Recession, But Not There Yet - 28th May 24
Gold vs. Silver – Very Important Medium-term Signal - 28th May 24
Is Gold Price Heading to $2,275 - 2,280? - 28th May 24
Stocks Bull Market Smoking Gun - 25th May 24
Congress Moves against Totalitarian Central Bank Digital Currency Schemes - 25th May 24
Government Tinkering With Prices Is Like Hiding All of the Street Signs - 25th May 24
Gold Mid Tier Mining Stocks Fundamentals - 25th May 24
Why US Interest Rates are a Nothing Burger - 24th May 24
Big Banks Are Pressuring The Fed To Losen Protection For Depositors - 24th May 24
Another Bank Failure: How to Tell if Your Bank is At Risk - 24th May 24
AI Stocks Portfolio and Tesla - 23rd May 24
All That Glitters Isn't Gold: Silver Has Outperformed Gold During This Gold Bull Run - 23rd May 24
Gold and Silver Expose Stock Market’s Phony Gains - 23rd May 24
S&P 500 Cyclical Relative Performance: Stocks Nearing Fully Valued - 23rd May 24
Nvidia NVDA Stock Earnings Rumble After Hours - 22nd May 24
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24
Micro Strategy Bubble Mania - 10th May 24
Biden's Bureau of Labor Statistics is Cooking Jobs Reports - 10th May 24
Bitcoin Price Swings Analysis - 9th May 24
Could Chinese Gold Be the Straw That Breaks the Dollar's Back? - 9th May 24
The Federal Reserve Is Broke! - 9th May 24
The Elliott Wave Crash Course - 9th May 24
Psychologically Prepared for Bitcoin Bull Market Bubble MANIA Rug Pull Corrections 2024 - 8th May 24
Why You Should Pay Attention to This Time-Tested Stock Market Indicator Now - 8th May 24
Copper: The India Factor - 8th May 24
Gold 2008 and 2022 All Over Again? Stocks, USDX - 8th May 24
Holocaust Survivor States Israel is Like Nazi Germany, The Fourth Reich - 8th May 24
Fourth Reich Invades Rafah Concentration Camp To Kill Palestinian Children - 8th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Democrats Abandon the Environment

Politics / Climate Change Jul 16, 2009 - 09:10 AM GMT

By: Global_Research

Politics

Best Financial Markets Analysis ArticleShamus Cooke writes: “As a banker, I also welcome the fact that the 'cap-and-trade' system is becoming the dominant methodology for [carbon dioxide] control.”Simon Linnett, Executive Vice Chairman of Rothschild Bank.


Can the looming environmental catastrophe be solved by environmentalists working side by side with Wall Street Bankers? Such a question doesn’t deserve a serious answer. The Democrats, however, are attempting to address the issue of global warming by developing a “partnership” between those who love the earth, and those who love only profits.

Such a marriage must surely end in divorce. But the Obama administration is enjoying maximum political gain from the blissful honeymoon period, while in reality the honest environmentalists have already left in disgust, even those previously committed to supporting the Democrats: Greenpeace, Friends of the Earth, Public Citizen, etc. They rightfully feel betrayed and point to the Democrats’ “Cap-and-Trade” environmental bill as proof the same bill that Obama and the media claim to be a “historic” step forward.

Cap-and-Trade is itself an absurdity of logic, for it assumes that the economic mechanisms responsible for the destruction of the environment, capitalism, should be the centerpiece of any potential solution. Any solution to global warming that isn't market-based (capitalistic) has been explicitly rejected by the two-party system.

But this immediately presents a new problem: how to create a “profitable market” out of pollution reduction? Such a question can only expect blank stares in return, but the titans of Wall Street are well known for sleight of hand tricks that conjure up billions.

When it comes to Cap-and-Trade, the government has become Wall Street’s vehicle for quick cash. What will be “traded” in Cap-and-Trade is the ability to pollute, called “allowances,” a commodity that promises to be sold and speculated by the really big banks — Goldman Sachs, JP Morgan Chase, Morgan Stanley, etc — who already have eco-trading houses in the U.S., and are simply waiting for the Senate to pass them a tidal wave of cash. And although Obama originally promised that corporations would bid for these allowances from the government, the bill passed by the House demands that only 15 percent be bought, while the rest is given away at taxpayer expense.

The bill also sets a pollution limit or “cap” on designated types of pollutants, with the companies that exceed the cap having to buy more “allowances,” while those that easily meet the cap may sell their allowances to the more polluting company. Thus, the intention is for the worst polluters to have a financial incentive to “go green.”

In reality, however, giant corporations dominate not only the market, but Congressmen, exerting maximum influence at the slightest chance their profits might be threatened. Cap-and-Trade was therefore inbuilt with easily exploitable loopholes, to the great benefit of Wall Street and polluters.

The more obvious loopholes are three-fold: the generous size of the pollution cap, the gigantic amount of free allowances, and the obscure concept of the “offset” — companies may skirt the already-generous cap by being “green” elsewhere, such as by starting a coke bottle recycling program in San Diego or simply purchasing offsets from elsewhere. The ability to regulate this offset loophole is all but impossible, and Wall Street has big plans to trade and speculate the device (commodity) for heavy profit.

Here's what Greenpeace says about the above loopholes: "[Cap-and-Trade] sets emission reduction targets far lower than science demands, then undermines even those targets with massive offsets. The giveaways and preferences in the bill will actually spur a new generation of nuclear and coal-fired power plants to the detriment of real energy solutions."

The key beneficiaries to these loop holes are the especially polluting corporations, such as the giant agri-corporations, big coal, big oil, and nuclear power. If you combine the billions in allowance giveaways with the low cap, you have A LOT of extra allowances to sell on the market, while also having a free-lease to continue polluting for years.

And the pollution may be initially worse than what exists currently, since the new law dismantles portions of the Clean Air Act, specifically the EPA's ability to regulate carbon emissions. A company, therefore, with a heavy allotment of allowances and offsets could legally pollute worse than they could today.

Perhaps the biggest danger the bill presents is the illusion of progress. The scientific consensus around global warming is extremely clear: either we make far-reaching changes in our environmental policy now or face incredible environmental and social devastation in the not-too-distant future.

This means not simply “moving away” from the use of fossil fuels and stricter regulation, but immediately building an alternative energy infrastructure — the mass production of solar panels, windmills, high speed trains, electric buses and cars, bikes, etc. An amazing opportunity to accomplish this was missed with the bankruptcy of General Motors. Instead of using GM's many factories to build for the future while saving jobs, the Democrats opted for the same broken system, building gas-guzzling individual cars, while many factories are to be demolished and the machinery sold for scrap.

This path was chosen because of the threat that the commonsense, environmental option posed: the status quo represented by the ultra-rich do not like actual change (which is why many of them endorsed Barack Obama). Instead, they would like society to stay exactly as it is, since they benefit enormously from it. If there are immense profits to be made in heavy polluting industries, this money will remain a much higher priority than the environment ever will under the two-party system. Loopholes, exceptions, allowances, and offsets will thus maul any attempt to address environmental issues.

To actually address the daunting issue of the environment, a wider perspective is needed, one that transcends both political parties and the broken economic system they are slavishly dedicated to. If society's resources are not used for the betterment of society, the search for profits is destined to destroy the planet.

Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action (www.workerscompass.org).  He can be reached at shamuscook@yahoo.com

Shamus Cooke is a frequent contributor to Global Research.  Global Research Articles by Shamus Cooke

© Copyright Shamus Cooke , Global Research, 2009

Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization. The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible or liable for any inaccurate or incorrect statements contained in this article.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in