Two Cents for My Idle Thoughts?
(You are, by now, used to my usual disclaimers!)
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
- Like whether foreign governments who stand to benefit from a warmer climate are promoting expansion of coal-based power and power-sector deregulation in poor and populated, but coal-rich nations to achieve their goals (while claiming to further Millenium Development Goals!)...??? (India can go nuclear when the Antarctic has been colonized!!)
– Like whether the US will invade 'Iran' as a face-saver to cover its 'withdrawal' from Iraq and whether the invasion of Iran is a thinly-veiled strategy to eventually confront Russia in a world-war by moving in to oil-rich Kazhakstan/Azerbaijan on behalf of the Saudis?
– Like whether the entire sub-prime crisis is a cleverly-thought out cover for arranging 'energy security' payment from Saudi Arabia (through German and Japanese Banks) for the protection provided to them by US not only from Iran and Iraqi elements, but also from competition to oil from emerging nuclear technology and gas – no thanks to the talks of a fledgling 'gas cartel' formed by anti-capitalist/anti-American countries including Russia, Venezuela, Algeria and Indonesia (on Forbes.com sometime in April)?
– Like, whether coal got the better of gas by not reacting to the lure of a 'cartel' despite the pressures of global warming....?????
– Like, you guessed it, whether gas and nuclear power (including thorium power) is being suppressed for another three decades of a 'fossil fuel' super-cycle (if we have to spend billions on cooling the earth, might as well scorch it first!)?
– Like the developing countries might just agree to a decades-long investment in the stock market plan as a compensation for agreeing to a 'no emissions reductions' deal with the rich countries. (Let global warming warm the poor on cold nights while I enjoy my capital appreciation in a jacuzzi!)
– Whether global financial systems are being systematically manipulated to get away with engineered bankruptcies? (That's one default in a thousand over the past two years. Surely you can live with it!)
– Like, we (at least in India) are silently and subtly, breaking in to two classes – the rich, and the brash on one side and the poor, educated, 'meek' and disciplined on the other?
– Whether political parties put up a show of public opposition to various matters after making under the table deals prior to the drama?
– Whether the recent multi-billion international fund launched by Sundaram BNP doubled up as a convenient tool to siphon away the booty before the government fell and the commies took over? (and whether some of the DLF/Everonn IPO 'blackshoe' money found its way in to this fund?)
– Whether the fumigation program has reduced the mosquito population by even a millionth (and whether the targets are mosquitoes or the 'pests at work/home' among us)?
– Whether the dollar exchange rate will slide all the way down to Rs 8 a dollar eventually – as the country advances – the exchange rate in the early eighties?
– Like, how polluted Chennai would be, if we were not blessed by the diurnal sea breeze (and would I be alive to write about it!)
– Like, the number of cyclones in the Bay of Bengal has reduced drastically over the past decade (we should try to relate it to the sun-spot activity before suspecting global warming! - though warmer surface temperatures are supposed spawn more cyclones)
– What happens to the funds in the 'Fund Reserves' category mentioned in the Annual Report of Mutual Funds. Surely, it is not transferred to the 'Investor Protection and Education Fund' and thenceforth to your financial advisor/agent/shoppe? (and you thought your agent was a fool to share his commission with you!!!)
– How does the US reconcile all the millions of 'foreign aid' it disburses to various nations over the years when it does not pay its dues to the UN and runs a trillion dollar deficit. Foreigners must be pretty darn important to the US, or, .....God help us!!!
– Whether the flyash-based cement measures up to technical strength requirements or is inappropriately used in engineering constructions and whether they will give way in the manner of the Minneapolis bridge?
– Whatever happens to the crores of 'river cleanup' funds that are announced every few years. The Cooum isn't getting any prettier or less nauseous. (and we frolic not a couple hundred meters away on the Marina beach.)
– Whether hedge funds and investment houses coordinate action (with the tacit support or knowledge of the government) to precipitate financial 'crisis' in the stock markets. Times of crisis and panic that induce price volatility can only help the well-informed and the well-endowed, not to mention those with access to resources.
– Whether capitalism turns every God-given necessity (air, water, wilderness, etc) in to a luxury meant only for the enjoyment of those who subscribe to its philosophy????
– And finally, whether it matters to turn richer in an absolute sense when the world of recreation and luxury is only available to those wealthy on a relative basis.
Think about it (and leave the yellow journalism to me!)
Wednesday, August 22, 2007
Friday, August 17, 2007
The Independence Day Speech Our Prime Minister Did Not Give!
The Independence Day Speech Our Prime Minister Did Not Give!
(A lighthearted parody with no malice and no truth whatsoever)
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
Fellow Citizens, My greetings to you (and heartfelt sympathies too!). As I stand before you on this august morning (feels like a June afternoon), I cannot but reminisce of the times when I first took charge of the Finance Ministry (they called me 'too meek' to handle Defence). Back then, India was in a boom following the reforms undertaken by Rajiv Gandhi and Narasimha Rao. The mood was resurgent and India prospered despite the Asian financial crisis. Today, India is growing at a healthy pace on all fronts (well, if you discount Mining and Agriculture, morals and discipline, courtesy and kindness, and a sustainable future). With abundant rains this monsoon (and despite our misguided policies), our economy is poised for takeoff.
On the Policy front, my government has paid utmost attention to price stability. By controlling inflation with 'supply-side' and 'demand-side' measures, we have managed to contain inflation even while the economy advances at near double-digit growth rates. We have imported wheat and restrained exports of milk products to contain retail price inflation (while ensuring you have less take-home pay by raising home interest loan rates to bleed your pockets). For the benefit of the poor, we have continued the subsidy on power and fertilizers even if it means contorting the economy in ways even my students cannot model in their micro classes! (Subsidy, my foot! In truth, even calling it 'free' power is a misnomer; we make a loss for every unit supplied to agricultural pumpsets. And as for the fertilizers, just look at how the stock market is salivating at the prospect of additional subsidies. Need I say more?). For the benefit of the middle-class, this government took pains to hold back prices of automotive fuels even if it meant forcing heavy losses on Oil PSUs (in exchange for some 'nominal rearrangement' in the allocation of oil and gas exploration blocks!). We have created a National Investment Fund that serves as a repository for all PSU disinvestment proceedings. It is your government's resolve to fund social welfare programs from this fund (Actually, with the leftovers in this fund after investing in power sector in which private firms and FIIs are invested and placating the left with, how should I put this, 'margin money'!). The roaring stock market is a testimony to the success of our policies (Never mind that the stock market has been taken over by foreign investors, who bleed and hijack the nation at regular intervals! By the way, I do hope you make hay while the sun shines. The billions of rupees of oil bonds we issued are due for redemption in a few years. That's when you will face the music.) I am sure that my ministers, including my coalition partners stand ready to accept the policy challenge to guide this nation forward.
Your Government has made significant progress in social welfare programs. We now fund construction of rural roads and schools as well as free medicines to women, children and the aged. (Quite a deal for their votes, don't you think?) In cooperation with state governments, we have pension programs for porters, beggars, and the unorganized labor sector (We are planning one for the educated but perennially unemployed!). Our commitment to gender equality in politics is evident in the election of the first lady President of India (In this country, nominating one lady to a higher post is more economical to entrenched male incumbents than a hundred to the Lok Sabha!). Much has been made of the Narmada, SEZ and the Nandigram issues. It is true that development sometimes exacts a price on our resources and our people. But these projects are likely to bring in perennial employment and revenues to the nation. (Never mind, that land was given away for free or at a pittance. And to cap it, we offered a 10-20 year tax-exemption window). I appeal to those displaced to cooperate in the spirit of patriotism to build a modern, industrialized India. (Surely, I cannot ask the industry to pay for the dislocated? After all, the projects are meant for the poor!).
We have always sided with the small rural farmer. Beside supplying power free of cost, we are investing lakhs of crores in inter-basin river-linking projects that will improve irrigation water supply for farmers. (What's your question? Which cement company will benefit the most? How'd I know? We haven't discussed that yet. Oops!). Believe me, the 'cost-effectiveness' of these projects passes our government's threshold (which was made up by Laluji as he walked along the corridors of his office!). I assure you, these projects will bring the waters of the Ganges to the Kaveri and the waters of Brahmaputra to the Thar within your child's lifetime ( that they are contaminated with floating corpses and sewage should not worry you much. There may also be jurisdictional disputes, but then, so long as you beg for your 'quota', our seasoned politicians will negotiate the same on your behalf).
I take pride in informing you that this government has consistently supported environmental initiatives. I laud the smoke-free Chandigarh initiative and hope other cities will follow suit. (errr... who wrote this stuff? I hope 'Tobacco' isn't one of our campaign contributor). We have released funds for the cleaning up of lakes and rivers (Whoa! Really? Perhaps some of our contractors are ready to be milked!), enforced pollution regulations strictly (Ha Ha Ha Ha Ho Ho Ho Ho!..... )... Excuse me, I have a bad cough!!... and supported Project Tiger (Mercy! I thought the GEF or a foreign Oil Major funded it thru the MoEF?). I am sure, with your help (ie, if you stay indoors or don't mind the 'desi' odors and outdoors), we can overcome all hurdles in our path to environmental sustainability. (My! I hope that was easy to digest!)
I also take this occasion to share with my fellow citizens this government's resolve to stand tall against global pressure to abdicate and tow the line as regards global climate change and emissions reductions. While we stand ready to cooperate with international agencies with regard to containing global warming (our dual-strategy to simultaneously adopt and delay clean technology/fossil fuels as appropriate, is paying off. Just look at carbon credits notched up by our industry!), no country shall dictate terms to us (How can they? We have already sold out to the US!). Many have criticized the nuclear agreement with the US as one that denies us our sovereign rights to reprocessing and national security decisions. Despite what my detractors would say (that it is a 'fairweather deal'), I personally assure you that my government has the best interest of our country in signing the nuclear deal with the US. (In fact, we are so patriotic that we have sold out our thorium technology to the anti-global warming powers behind the scene in exchange for excluding us from any binding carbon emissions reductions plan! Two birds with one stone, and not just for us. The US and Australia too benefit in this political triangle. Interns in politics, note how we designed the 'trikona' strategy and camouflaged the 'technology transfer' in patriotism!....And you say experience does not matter?)
As we look forward to the completion of our first term in office, I commend the cooperation of all coalition partners in the smooth functioning of the government and thank them for the same. (Damn, the lies one has to utter to stay in power! In truth, our coalition partners have robbed me of my powers and made a mockery of the economist in me). Today, our economy stands at the cross-roads of time. Let us not forget the sacrifices made by our freedom-fighters, our armed forces and past leaders of the nation. Let us together fight the forces of division, deceit and suppression and carry the nation to glory envisioned by Vivekananda, Tagore, Nehru, Gandhi, Rao, Vajpayee, ..... (Boy, am I short of breath. Surely, it's not the morning mist hanging in the air?).
Glory to be God! (or as we say in this land of mysticism, Kali da jawab nahi!)
Jai Hind!
(Now, where is that speechwriter of mine?)
(A lighthearted parody with no malice and no truth whatsoever)
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
Fellow Citizens, My greetings to you (and heartfelt sympathies too!). As I stand before you on this august morning (feels like a June afternoon), I cannot but reminisce of the times when I first took charge of the Finance Ministry (they called me 'too meek' to handle Defence). Back then, India was in a boom following the reforms undertaken by Rajiv Gandhi and Narasimha Rao. The mood was resurgent and India prospered despite the Asian financial crisis. Today, India is growing at a healthy pace on all fronts (well, if you discount Mining and Agriculture, morals and discipline, courtesy and kindness, and a sustainable future). With abundant rains this monsoon (and despite our misguided policies), our economy is poised for takeoff.
On the Policy front, my government has paid utmost attention to price stability. By controlling inflation with 'supply-side' and 'demand-side' measures, we have managed to contain inflation even while the economy advances at near double-digit growth rates. We have imported wheat and restrained exports of milk products to contain retail price inflation (while ensuring you have less take-home pay by raising home interest loan rates to bleed your pockets). For the benefit of the poor, we have continued the subsidy on power and fertilizers even if it means contorting the economy in ways even my students cannot model in their micro classes! (Subsidy, my foot! In truth, even calling it 'free' power is a misnomer; we make a loss for every unit supplied to agricultural pumpsets. And as for the fertilizers, just look at how the stock market is salivating at the prospect of additional subsidies. Need I say more?). For the benefit of the middle-class, this government took pains to hold back prices of automotive fuels even if it meant forcing heavy losses on Oil PSUs (in exchange for some 'nominal rearrangement' in the allocation of oil and gas exploration blocks!). We have created a National Investment Fund that serves as a repository for all PSU disinvestment proceedings. It is your government's resolve to fund social welfare programs from this fund (Actually, with the leftovers in this fund after investing in power sector in which private firms and FIIs are invested and placating the left with, how should I put this, 'margin money'!). The roaring stock market is a testimony to the success of our policies (Never mind that the stock market has been taken over by foreign investors, who bleed and hijack the nation at regular intervals! By the way, I do hope you make hay while the sun shines. The billions of rupees of oil bonds we issued are due for redemption in a few years. That's when you will face the music.) I am sure that my ministers, including my coalition partners stand ready to accept the policy challenge to guide this nation forward.
Your Government has made significant progress in social welfare programs. We now fund construction of rural roads and schools as well as free medicines to women, children and the aged. (Quite a deal for their votes, don't you think?) In cooperation with state governments, we have pension programs for porters, beggars, and the unorganized labor sector (We are planning one for the educated but perennially unemployed!). Our commitment to gender equality in politics is evident in the election of the first lady President of India (In this country, nominating one lady to a higher post is more economical to entrenched male incumbents than a hundred to the Lok Sabha!). Much has been made of the Narmada, SEZ and the Nandigram issues. It is true that development sometimes exacts a price on our resources and our people. But these projects are likely to bring in perennial employment and revenues to the nation. (Never mind, that land was given away for free or at a pittance. And to cap it, we offered a 10-20 year tax-exemption window). I appeal to those displaced to cooperate in the spirit of patriotism to build a modern, industrialized India. (Surely, I cannot ask the industry to pay for the dislocated? After all, the projects are meant for the poor!).
We have always sided with the small rural farmer. Beside supplying power free of cost, we are investing lakhs of crores in inter-basin river-linking projects that will improve irrigation water supply for farmers. (What's your question? Which cement company will benefit the most? How'd I know? We haven't discussed that yet. Oops!). Believe me, the 'cost-effectiveness' of these projects passes our government's threshold (which was made up by Laluji as he walked along the corridors of his office!). I assure you, these projects will bring the waters of the Ganges to the Kaveri and the waters of Brahmaputra to the Thar within your child's lifetime ( that they are contaminated with floating corpses and sewage should not worry you much. There may also be jurisdictional disputes, but then, so long as you beg for your 'quota', our seasoned politicians will negotiate the same on your behalf).
I take pride in informing you that this government has consistently supported environmental initiatives. I laud the smoke-free Chandigarh initiative and hope other cities will follow suit. (errr... who wrote this stuff? I hope 'Tobacco' isn't one of our campaign contributor). We have released funds for the cleaning up of lakes and rivers (Whoa! Really? Perhaps some of our contractors are ready to be milked!), enforced pollution regulations strictly (Ha Ha Ha Ha Ho Ho Ho Ho!..... )... Excuse me, I have a bad cough!!... and supported Project Tiger (Mercy! I thought the GEF or a foreign Oil Major funded it thru the MoEF?). I am sure, with your help (ie, if you stay indoors or don't mind the 'desi' odors and outdoors), we can overcome all hurdles in our path to environmental sustainability. (My! I hope that was easy to digest!)
I also take this occasion to share with my fellow citizens this government's resolve to stand tall against global pressure to abdicate and tow the line as regards global climate change and emissions reductions. While we stand ready to cooperate with international agencies with regard to containing global warming (our dual-strategy to simultaneously adopt and delay clean technology/fossil fuels as appropriate, is paying off. Just look at carbon credits notched up by our industry!), no country shall dictate terms to us (How can they? We have already sold out to the US!). Many have criticized the nuclear agreement with the US as one that denies us our sovereign rights to reprocessing and national security decisions. Despite what my detractors would say (that it is a 'fairweather deal'), I personally assure you that my government has the best interest of our country in signing the nuclear deal with the US. (In fact, we are so patriotic that we have sold out our thorium technology to the anti-global warming powers behind the scene in exchange for excluding us from any binding carbon emissions reductions plan! Two birds with one stone, and not just for us. The US and Australia too benefit in this political triangle. Interns in politics, note how we designed the 'trikona' strategy and camouflaged the 'technology transfer' in patriotism!....And you say experience does not matter?)
As we look forward to the completion of our first term in office, I commend the cooperation of all coalition partners in the smooth functioning of the government and thank them for the same. (Damn, the lies one has to utter to stay in power! In truth, our coalition partners have robbed me of my powers and made a mockery of the economist in me). Today, our economy stands at the cross-roads of time. Let us not forget the sacrifices made by our freedom-fighters, our armed forces and past leaders of the nation. Let us together fight the forces of division, deceit and suppression and carry the nation to glory envisioned by Vivekananda, Tagore, Nehru, Gandhi, Rao, Vajpayee, ..... (Boy, am I short of breath. Surely, it's not the morning mist hanging in the air?).
Glory to be God! (or as we say in this land of mysticism, Kali da jawab nahi!)
Jai Hind!
(Now, where is that speechwriter of mine?)
Monday, August 6, 2007
Election Planks, Sickles, Cycles and Cows
Election Planks, Sickles, Cycles and Cows
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
For those of you who follow Krugman, his gingerly entry in to electoral politics would not have gone unnoticed. I have no such fears of writing on the matter, much as a career politician would feel no qualms about opining on abstruse policy matters involving specialized knowledge of disciplines. So, having graduated in Mineral Economics, I step in, albeit gingerly, in to 'Political Yellow Journalism'!
When I joined school, Gandhi was still a household name, what with the memory of the freedom struggle still fresh in the minds of parents. With the passage of time, the freedom struggle has largely receded from politics, but for its 'heritage value' during campaigning. The Gandhis, the Nehrus and the Kamarajs now merely adorn the party banners. Following their ideals would be harakiri!. But that is symptomatic of a larger problem – that of election issues, promises and manifestos. These used to be the channels through which parties and candidates perceived issues of interest among the electorate, learnt of their needs and priorities and through which they communicated their agenda to the masses. No longer; now, they merely serve as instruments to gain familiarity with voters and communicate positions and deals on various issues.
As I perceive it, there are three levels at which pre-election deals/promises are made – privately with wealthy bigwigs from the industry, and sometimes, international organizations, publicly through newspapers and media with the middle-class and the intelligentia, and separately with the poor masses through local community leaders or mafia bosses. But it is the votes of the masses that counts on the D-day, and that means wooing the poor and the middle classes. It may be that many of the married poor have already been bought out by rival parties who sponsor their ration card or employment, their freedom from the hands of law or the land on which they live. Those not in this 'net' are bought out by promised a certain amount of 'music' broadcast by loudspeakers attached to autorickshaws sporting the candidate and his/her party logo. The youth among the poor are likely already rounded up by our local activists. That leaves the educated middle-class who are too smart to profess unending loyalty and yet gullible enough to buy a straight-faced lie. What combination of election promises will appease them? First the retired – an important constituency, who, bitten by the patriotic bug, cast their votes without fail (they even show up at the booth before voting begins!). Perhaps they will identify with historical leaders of repute and character. In any case, the promise of a 10% rate on their provident fund ought to placate them; never mind the deficit. Now for the working class. Hmm, what do we here? A 111th pay commission to look in to their salary structure? That should keep them expecting a few years. What about women? (Damn, they won't follow their husbands. That would have cut costs in half!) Equal opportunity? No, that could be costly. Why not a quota or a reservation instead. 20% reservation for women in white collar jobs. How does that sound? .....Not bad! That leaves the yuppy youth on motorbikes drawing inflated salaries. You sure they'll be awake by the time voting winds up? Try a mid-day SMS alarm in to their mobiles on voting day. Follow it up with an invitation to a post-election party at 5pm. That might do the trick. That does it.
Now that all bases are covered, (that should get us the 25% vote needed to win the ballot) it's time to move on and plan for the post-election. Time to plan strategy for cornering ministerial posts, plum boardroom assignments, stake out licenses and commissions of inquiry, .....
A politicians life is very demanding...... Indeed!
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
For those of you who follow Krugman, his gingerly entry in to electoral politics would not have gone unnoticed. I have no such fears of writing on the matter, much as a career politician would feel no qualms about opining on abstruse policy matters involving specialized knowledge of disciplines. So, having graduated in Mineral Economics, I step in, albeit gingerly, in to 'Political Yellow Journalism'!
When I joined school, Gandhi was still a household name, what with the memory of the freedom struggle still fresh in the minds of parents. With the passage of time, the freedom struggle has largely receded from politics, but for its 'heritage value' during campaigning. The Gandhis, the Nehrus and the Kamarajs now merely adorn the party banners. Following their ideals would be harakiri!. But that is symptomatic of a larger problem – that of election issues, promises and manifestos. These used to be the channels through which parties and candidates perceived issues of interest among the electorate, learnt of their needs and priorities and through which they communicated their agenda to the masses. No longer; now, they merely serve as instruments to gain familiarity with voters and communicate positions and deals on various issues.
As I perceive it, there are three levels at which pre-election deals/promises are made – privately with wealthy bigwigs from the industry, and sometimes, international organizations, publicly through newspapers and media with the middle-class and the intelligentia, and separately with the poor masses through local community leaders or mafia bosses. But it is the votes of the masses that counts on the D-day, and that means wooing the poor and the middle classes. It may be that many of the married poor have already been bought out by rival parties who sponsor their ration card or employment, their freedom from the hands of law or the land on which they live. Those not in this 'net' are bought out by promised a certain amount of 'music' broadcast by loudspeakers attached to autorickshaws sporting the candidate and his/her party logo. The youth among the poor are likely already rounded up by our local activists. That leaves the educated middle-class who are too smart to profess unending loyalty and yet gullible enough to buy a straight-faced lie. What combination of election promises will appease them? First the retired – an important constituency, who, bitten by the patriotic bug, cast their votes without fail (they even show up at the booth before voting begins!). Perhaps they will identify with historical leaders of repute and character. In any case, the promise of a 10% rate on their provident fund ought to placate them; never mind the deficit. Now for the working class. Hmm, what do we here? A 111th pay commission to look in to their salary structure? That should keep them expecting a few years. What about women? (Damn, they won't follow their husbands. That would have cut costs in half!) Equal opportunity? No, that could be costly. Why not a quota or a reservation instead. 20% reservation for women in white collar jobs. How does that sound? .....Not bad! That leaves the yuppy youth on motorbikes drawing inflated salaries. You sure they'll be awake by the time voting winds up? Try a mid-day SMS alarm in to their mobiles on voting day. Follow it up with an invitation to a post-election party at 5pm. That might do the trick. That does it.
Now that all bases are covered, (that should get us the 25% vote needed to win the ballot) it's time to move on and plan for the post-election. Time to plan strategy for cornering ministerial posts, plum boardroom assignments, stake out licenses and commissions of inquiry, .....
A politicians life is very demanding...... Indeed!
Sunday, August 5, 2007
Economist's Nightmare, Environmentalist's Delight?
Globalize Power Generation to Abate Global Warming
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
Just yesterday, at www.livemint.com, I opined against India's voluntary involvement in any carbon reduction proposal. Clearly, as a country, India cannot afford to hold back the millions of its citizens in abject poverty to assuage the feelings of the developed world who conveniently forgot for decades that CO2 emissions turn the earth warmer. But, climate change will not stop for India, or for that matter, any other country. It has been gathering steam all these years and decades and now, alarmingly, it seems to be accelerating. We must reduce CO2 concentrations, and that too within a short period of time. 15 years post Kyoto, we have achieved little. Some, me included, would contend that the wave of privatization and competition in various economies and especially the power sector, has set us back and moved the world closer to an environmental catastrophe. Perhaps Kyoto has served its purpose of enriching dirty capitalists while we waited for it to deliver an environmental miracle!
Now that the group of nations is gathered to consider a new emissions reduction plan, I cannot but muse about its prospects. Surely, we do not want to learn five decades from now that we used the wrong criterion or permitted an unwise loophole or two, did not anticipate emissions from new service industries or did not include a certain sub-clause in exchange for a week's vacation in the Virgin Islands! We want a solution that obtains real physical reduction in CO2 emissions and concentrations within a decade. Can the new protocol deliver this? I fear not. Is there an alternate plan short of nuclear winter? Well, let's explore one. A solution very different from the one would unfold with the adoption of a new global treaty. No, it is most definitely not an economist's solution (I’d almost distance myself from it!). In fact, far from it, it is an 'apocalypse tomorrow' kind of solution; one that takes a dark view of what has already occurred and prescribes a draconian solution by a benevolent environmental dictator.
We know coal capacity constitutes over 70% of total power generation globally and is responsible for about a third of global GHG emissions. We know coal is very polluting, regardless of the type of technology used to convert it to power. We also know China and India are building thermal plants faster than rabbits multiply (and the US, not to be outdone, is adding some of its own!). No one builds a thermal plant to operate for an year, two or a decade. A super-size mine-mouth thermal plant built on the coal reserves of an entire mine, emits CO2 for three decades or more. By the time, the negotiations conclude and the countries endorse the new protocol in their elected body of representatives, it would be another decade and glaciology would be discipline of the past world! The good news though, is we have plenty of gas and plenty of thorium across the world to sustain power generation for a couple of decades or more (though, the thorium-power technology developed by India is being 'postponed' thirty years. No, there is no link to the '123' nuclear agreement with the US or the ongoing global warming negotiations). If climate change is already upon us (behold the shrinking glaciers and extreme weather events), should we not act today (when we should have acted yesterday)?
Much of the electrified world is connected through grids across regions, even continents. We could go a step beyond nationalization and 'globalize' power generation and put it under common ownership. Then, as an emergency measure, we could completely do away with coal-based power generation for a few decades; power would be exclusively generated from hydro, gas, wind and nuclear stations. It'd be necessary to open up gas fields and ramp up gas production (Have a look at global gas reserves and you will get my point) and require gas production to be diverted to power generation almost by a decree. Gas would be preferentially supplied to power stations around the world at rates determined by the amount of existing regional gas generation capacity (granted there would be monopsony pricing power, but gas is assured a market). Power consuming 'blocs' could then put in their bids for supply of 'green power' from this 'globalized' electricity network. Prices may be twice as high regionally, but demand would be satisfied. As for coal suppliers, they could be compensated at the rate of half a cent per KWH that they were excluded from generating as of a certain baseline date.
What good would it do? True, a large part of the generating capacity is coal-based. But the fuel-flexible fraction of that capacity could be converted to gas immediately. The rest would need to be retrofitted to accommodate gas – something that can be achieved within a few years, if there is political will (The mine-mouth power plants could be converted to mine-mouth iron and steel plants!). This achieved, we could exclude coal from thermal stations, reducing emissions by a quarter almost 'overnight'. CO2 concentration, now on an inexorable upward trend, would pause within a decade. Longer-term technological advances and capital retirement, obsolescence and turnover would reinforce the environmental gains and, hopefully, reverse the emissions trend beyond 2020. Fifty years down the road, when CO2 concentrations have been halved, environmental lessons truly learned and the world environmentally and technologically advanced, one could reconsider coal as a fuel in all its end-uses.
An economist's nightmare, but an environmentalist's delight?
Ganga Prasad G. Rao
http://myprofile.cos.com/gangar
Just yesterday, at www.livemint.com, I opined against India's voluntary involvement in any carbon reduction proposal. Clearly, as a country, India cannot afford to hold back the millions of its citizens in abject poverty to assuage the feelings of the developed world who conveniently forgot for decades that CO2 emissions turn the earth warmer. But, climate change will not stop for India, or for that matter, any other country. It has been gathering steam all these years and decades and now, alarmingly, it seems to be accelerating. We must reduce CO2 concentrations, and that too within a short period of time. 15 years post Kyoto, we have achieved little. Some, me included, would contend that the wave of privatization and competition in various economies and especially the power sector, has set us back and moved the world closer to an environmental catastrophe. Perhaps Kyoto has served its purpose of enriching dirty capitalists while we waited for it to deliver an environmental miracle!
Now that the group of nations is gathered to consider a new emissions reduction plan, I cannot but muse about its prospects. Surely, we do not want to learn five decades from now that we used the wrong criterion or permitted an unwise loophole or two, did not anticipate emissions from new service industries or did not include a certain sub-clause in exchange for a week's vacation in the Virgin Islands! We want a solution that obtains real physical reduction in CO2 emissions and concentrations within a decade. Can the new protocol deliver this? I fear not. Is there an alternate plan short of nuclear winter? Well, let's explore one. A solution very different from the one would unfold with the adoption of a new global treaty. No, it is most definitely not an economist's solution (I’d almost distance myself from it!). In fact, far from it, it is an 'apocalypse tomorrow' kind of solution; one that takes a dark view of what has already occurred and prescribes a draconian solution by a benevolent environmental dictator.
We know coal capacity constitutes over 70% of total power generation globally and is responsible for about a third of global GHG emissions. We know coal is very polluting, regardless of the type of technology used to convert it to power. We also know China and India are building thermal plants faster than rabbits multiply (and the US, not to be outdone, is adding some of its own!). No one builds a thermal plant to operate for an year, two or a decade. A super-size mine-mouth thermal plant built on the coal reserves of an entire mine, emits CO2 for three decades or more. By the time, the negotiations conclude and the countries endorse the new protocol in their elected body of representatives, it would be another decade and glaciology would be discipline of the past world! The good news though, is we have plenty of gas and plenty of thorium across the world to sustain power generation for a couple of decades or more (though, the thorium-power technology developed by India is being 'postponed' thirty years. No, there is no link to the '123' nuclear agreement with the US or the ongoing global warming negotiations). If climate change is already upon us (behold the shrinking glaciers and extreme weather events), should we not act today (when we should have acted yesterday)?
Much of the electrified world is connected through grids across regions, even continents. We could go a step beyond nationalization and 'globalize' power generation and put it under common ownership. Then, as an emergency measure, we could completely do away with coal-based power generation for a few decades; power would be exclusively generated from hydro, gas, wind and nuclear stations. It'd be necessary to open up gas fields and ramp up gas production (Have a look at global gas reserves and you will get my point) and require gas production to be diverted to power generation almost by a decree. Gas would be preferentially supplied to power stations around the world at rates determined by the amount of existing regional gas generation capacity (granted there would be monopsony pricing power, but gas is assured a market). Power consuming 'blocs' could then put in their bids for supply of 'green power' from this 'globalized' electricity network. Prices may be twice as high regionally, but demand would be satisfied. As for coal suppliers, they could be compensated at the rate of half a cent per KWH that they were excluded from generating as of a certain baseline date.
What good would it do? True, a large part of the generating capacity is coal-based. But the fuel-flexible fraction of that capacity could be converted to gas immediately. The rest would need to be retrofitted to accommodate gas – something that can be achieved within a few years, if there is political will (The mine-mouth power plants could be converted to mine-mouth iron and steel plants!). This achieved, we could exclude coal from thermal stations, reducing emissions by a quarter almost 'overnight'. CO2 concentration, now on an inexorable upward trend, would pause within a decade. Longer-term technological advances and capital retirement, obsolescence and turnover would reinforce the environmental gains and, hopefully, reverse the emissions trend beyond 2020. Fifty years down the road, when CO2 concentrations have been halved, environmental lessons truly learned and the world environmentally and technologically advanced, one could reconsider coal as a fuel in all its end-uses.
An economist's nightmare, but an environmentalist's delight?
Friday, August 3, 2007
Global Warming? I'd call it Global Collusion!
Dear Editor (The Economist)
I found myself disagreeing with 'The Economist' on reading 'Better late than never'. Increasingly, the developed world is calling upon the developing countries to 'share' in reducing carbon emissions. But where was this camaraderie in 1970 when the western world was chugging away merrily on the back of the earth's capacity to assimilate all waste in to its pristine environment? As a citizen of a developing nation, I am tempted to ask for the same pristine air quality on which the developed nations enriched their economies. Instead, the developing nations, who, incidentally, held back rapid industrialization fearing resource exhaustion, have been bequeathed a world teetering at environmental collapse. Those who conserved resources in the decades of western industrialization are now being asked to go slow just precisely at the take-off point of their economies. The lesson to draw perhaps is 'if you need to rape the environment, be the first'!
The article dismisses the per-capita argument as nonsense. Theoretically, it may seem non-sensical to claim the right to degrade the environment as much as the 'Joneses' do. But when emissions are linked to industrial progress and development, nonsense it is not. The question of import is whether a human born in a developing country has the same right to 'the enjoyment of life' as someone born in the US. I suspect, deep inside, there are many who would rather not answer this question.
The average per-capita emissions figure hides large variations across income groups in the Indian society. A very large fraction of Indians cause minimal CO2 emissions. It is the industry and the nouveau rich who emit the most. The middle-class has no choice but to cause emissions from use of an inefficient transportation system thrust upon them (though overcrowded trains do reduce per-capita emissions!). The crucial question, as I see it, is whether we can raise the standard of living of the poor (and the middle class) without ratcheting up carbon emissions. The fact is the poor, especially the rural poor, as elsewhere, are in the unfortunate position of bearing the brunt of industrialization and Western capitalism. We do not grudge the West their party, but we do mind when the global warming they caused affects the lives of our rural poor and forces our government to shell out aid in millions in aid. The environmentalist in me says we should carbon tax all luxury goods and services indulged in by the rich - not to limit their enjoyment but to ensure compensation for the harm they cause to the environment.
On a tangent, I hasten to note the 'positive feedback' that characterizes urban warming - heat island effect - (the AC switched on to counter a hot day further increases outdoor temperature and reinforces the cycle). Power cuts caused by the surge in AC usage from urban warming are often targeted on the poor. This past summer, rural Maharashtra suffered innumerable, extended power cuts through the summer to fulfill the demands of the power-hungry Mumbai metropolis. Are we turning into a society in which the rich cause global warming and the poor suffer it? Capitalism with competition in a world of unequal opportunity eventually brings about slavery.
Another point I'd like to make is that the Indian economy, driven by FII money, is induced to move to GHG-intensive fuels like lignite to lower its cost and generate the EPS growth needed to sustain the monetary inflows for expansion. (Lesser emphasis on population control doesn't hurt volume growth or profit projections either!) Global warming has already caused a global shift in the production of carbon-intensive goods to developing countries not bound by the Kyoto protocol. I suspect any reduction in emissions from adoption of new technology will be more than likely washed out by the switch to dirtier fuels, the growth in population and import of emissions ('carbon leakage') from the developed to developing world.
Finally, there is an utter lack of economic logic in the policies adopted by the government ('cost-effectiveness'!). Going by the logic of net benefits, policies like population control, a CAFE-cum-vehicle turnover credit policy, green pricing of carbon-fuels (and foodgrains!), reduction of subsidies on carbon-intensive goods and services are likely to rank high. The international community must ensure that whatever carbon-trading mechanism we adopt, they do not preclude policies such as above. It would also be a gargantuan mistake to address global warming in isolation ignoring other issues such as urbanization, intra- and inter-country political and economic strategies (states competing for large, GHG-intensive projects by offering less stringent environmental standards), or poverty.
All said and done, I suspect the motive for India's shift in stance is green money from GEF, EPA or Al Gore or pension funds from California! Long live Global Warming!
--
Ganga Prasad G. Rao
Aparna 19 New, 30 Old Janakiram Colony
Arumbakkam, Chennai 600106
gangaprasad.rao@gmail.com
http://myprofile.cos.com/gangar
I found myself disagreeing with 'The Economist' on reading 'Better late than never'. Increasingly, the developed world is calling upon the developing countries to 'share' in reducing carbon emissions. But where was this camaraderie in 1970 when the western world was chugging away merrily on the back of the earth's capacity to assimilate all waste in to its pristine environment? As a citizen of a developing nation, I am tempted to ask for the same pristine air quality on which the developed nations enriched their economies. Instead, the developing nations, who, incidentally, held back rapid industrialization fearing resource exhaustion, have been bequeathed a world teetering at environmental collapse. Those who conserved resources in the decades of western industrialization are now being asked to go slow just precisely at the take-off point of their economies. The lesson to draw perhaps is 'if you need to rape the environment, be the first'!
The article dismisses the per-capita argument as nonsense. Theoretically, it may seem non-sensical to claim the right to degrade the environment as much as the 'Joneses' do. But when emissions are linked to industrial progress and development, nonsense it is not. The question of import is whether a human born in a developing country has the same right to 'the enjoyment of life' as someone born in the US. I suspect, deep inside, there are many who would rather not answer this question.
The average per-capita emissions figure hides large variations across income groups in the Indian society. A very large fraction of Indians cause minimal CO2 emissions. It is the industry and the nouveau rich who emit the most. The middle-class has no choice but to cause emissions from use of an inefficient transportation system thrust upon them (though overcrowded trains do reduce per-capita emissions!). The crucial question, as I see it, is whether we can raise the standard of living of the poor (and the middle class) without ratcheting up carbon emissions. The fact is the poor, especially the rural poor, as elsewhere, are in the unfortunate position of bearing the brunt of industrialization and Western capitalism. We do not grudge the West their party, but we do mind when the global warming they caused affects the lives of our rural poor and forces our government to shell out aid in millions in aid. The environmentalist in me says we should carbon tax all luxury goods and services indulged in by the rich - not to limit their enjoyment but to ensure compensation for the harm they cause to the environment.
On a tangent, I hasten to note the 'positive feedback' that characterizes urban warming - heat island effect - (the AC switched on to counter a hot day further increases outdoor temperature and reinforces the cycle). Power cuts caused by the surge in AC usage from urban warming are often targeted on the poor. This past summer, rural Maharashtra suffered innumerable, extended power cuts through the summer to fulfill the demands of the power-hungry Mumbai metropolis. Are we turning into a society in which the rich cause global warming and the poor suffer it? Capitalism with competition in a world of unequal opportunity eventually brings about slavery.
Another point I'd like to make is that the Indian economy, driven by FII money, is induced to move to GHG-intensive fuels like lignite to lower its cost and generate the EPS growth needed to sustain the monetary inflows for expansion. (Lesser emphasis on population control doesn't hurt volume growth or profit projections either!) Global warming has already caused a global shift in the production of carbon-intensive goods to developing countries not bound by the Kyoto protocol. I suspect any reduction in emissions from adoption of new technology will be more than likely washed out by the switch to dirtier fuels, the growth in population and import of emissions ('carbon leakage') from the developed to developing world.
Finally, there is an utter lack of economic logic in the policies adopted by the government ('cost-effectiveness'!). Going by the logic of net benefits, policies like population control, a CAFE-cum-vehicle turnover credit policy, green pricing of carbon-fuels (and foodgrains!), reduction of subsidies on carbon-intensive goods and services are likely to rank high. The international community must ensure that whatever carbon-trading mechanism we adopt, they do not preclude policies such as above. It would also be a gargantuan mistake to address global warming in isolation ignoring other issues such as urbanization, intra- and inter-country political and economic strategies (states competing for large, GHG-intensive projects by offering less stringent environmental standards), or poverty.
All said and done, I suspect the motive for India's shift in stance is green money from GEF, EPA or Al Gore or pension funds from California! Long live Global Warming!
--
Ganga Prasad G. Rao
Aparna 19 New, 30 Old Janakiram Colony
Arumbakkam, Chennai 600106
gangaprasad.rao@gmail.com
http://myprofile.cos.com/gangar
Subscribe to:
Posts (Atom)
