Tuesday, August 30, 2011

A brief meditation on science, democracy and complexity

A recent article in the Ventura County Reporter, Our Ocean: As Healthy as it Looks?, does a nice job of contrasting public perception (the ocean looks great from Highway 101, the fishing is good, altogether it seems pretty healthy) with a series of scientific reports predicting environmental catastrophe due to ocean acidification, rising global carbon emissions, overfishing, pollution and a variety of other factors.

What accounts for the differing views of scientists and the public? And why is the situation likely to get much worse? Read on after the jump ...

Friday, August 26, 2011

It was 45 years ago today ....

The world's first view of Earth taken by a spacecraft from the vicinity of the moon. The photo was transmitted to Earth by the United States Lunar Orbiter I and received at the NASA tracking station near Madrid. This crescent of the Earth was photographed August 23, 1966 when the spacecraft was on its 16th orbit and just about to pass behind the moon.

Lots of people are familiar with the later, color version, taken by the Apollo astronauts a few years later. The emotional impact of the more famous image -- a blue/living planet set again the black/lifeless moon -- is undeniably greater ... but this is the original.

Thursday, August 25, 2011

Robyn O'Brien on Food

Robyn O'Brien authored “The Unhealthy Truth: How Our Food Is Making Us Sick and What We Can Do About It.” A former Wall Street food industry analyst, Robyn brings insight, compassion and detailed analysis to her research into the impact that the global food system is having on the health of our children. She founded allergykidsfoundation.org and was named by Forbes as one of “20 Inspiring Women to Follow on Twitter.” The New York Times has passionately described her as “Food’s Erin Brockovich.”

Wednesday, August 17, 2011

Gail the Actuary Tells it Like it Is

Here's another brilliant summary of our current global economic and energy situation by Gail the Actuary. It's a synopsis of the peak oil thesis and how it plays out as a 'growth ceiling' and economic decline. It doesn't even take into account catastrophic environmental crises caused by climate change (storms, floods, droughts, fires), causing mass migration, starvation and conflict, but that would be almost too much to contemplate at once. What I love most about Gail's presentation is that she finally concludes that "there is no solution." This is the conclusion I came to almost a year ago. When you put the whole ball of wax together, you have to face that fact that there really is no solution. Solutions that work for one complex set of arrangements tend to wreak havoc somewhere else. And there doesn't seem to be any set of solutions that can forestall even a partial collapse of the world's economy. That's either a 'bad thing' or a 'good thing' depending on what is collapsing and whether you're invested in keeping the whole system going. What is collapsing is globalized Capitalist civilization, and frankly, I'm not sorry to see it go.

Included in the presentation is a series of nifty charts and graphs. The most troubling, though, is the graph which shows a strong correlation between oil prices and the price of food.

Monday, August 15, 2011

Ecological Mayhem as Economic Opportunity

Can Jeremy Grantham Profit From Ecological Mayhem? analyzes the neo-Malthusian outlook of financial guru Jeremy Grantham, manager of $150 billion in investments, author of a financial newsletter with a wide following and benefactor to The Grantham Foundation for the Protection of the Environment

Grantham argues that the late-18th-century doomsayer Thomas Malthus pretty much got it right but just had the bad timing to make his predictions about unsustainable population growth on the eve of the hydrocarbon-fueled Industrial Revolution, which “partially removed the barriers to rapid population growth, wealth and scientific progress.” That put off the inevitable for a couple of centuries, but now, ready or not, the age of cheap hydrocarbons is ending. Grantham’s July letter concludes: “We humans have the brains and the means to reach real planetary sustainability. The problem is with us and our focus on short-term growth and profits, which is likely to cause suffering on a vast scale. With foresight and thoughtful planning, this suffering is completely avoidable.”
While it may be too late to “gracefully” deal with depleted resources­, climate change and related crises, it’s never too late to mitigate the damage. And, crucially, the consequences will be unevenly distributed, creating angles for you to make money and look out for your interests, however you define them.
Grantham has a fairly standard Malthusian take on the future and an interesting recognition of his status: “The rather burdensome thought is that people won’t listen to environmentalists, but they will sometimes listen to people like me.” Building on this, Grantham thinks economics rather than politics may be the way to address climate change -- particularly for the US. “People are naturally much more responsive to finite resources than they are to climate change. Global warming is bad news. Finite resources is investment advice.” He believes this shift in emphasis plays to Americans’ strength. “Americans are just about the worst at dealing with long-term problems, down there with Uzbekistan, but they respond to a market signal better than almost anyone. They roll the dice bigger and quicker than most.” Grantham says that corporations respond well to this message because they are “persuaded by data,” but American public opinion is harder to move, and contemporary American political culture is practically dataproof.

Here's his assessment of the standard litany of potential problems.
Energy “will give us serious and sustained problems” over the next 50 years as we make the transition from hydrocarbons — oil, coal, gas — to solar, wind, nuclear and other sources, but we’ll muddle through to a solution to Peak Oil and related challenges. Peak Everything Else will prove more intractable for humanity. Metals, for instance, “are entropy at work . . . from wonderful metal ores to scattered waste,” and scarcity and higher prices “will slowly increase forever,” but if we scrimp and recycle, we can make do for another century before tight constraint kicks in.

Agriculture is more worrisome. Local water shortages will cause “persistent irritation” — wars, famines. Of the three essential macro nutrient fertilizers, nitrogen is relatively plentiful and recoverable, but we’re running out of potassium and phosphorus, finite mined resources that are “necessary for all life.” Canada has large reserves of potash (the source of potassium), which is good news for Americans, but 50 to 75 percent of the known reserves of phosphate (the source of phosphorus) are located in Morocco and the western Sahara. Assuming a 2 percent annual increase in phosphorus consumption, Grantham believes the rest of the world’s reserves won’t last more than 50 years, so he expects “gamesmanship” from the phosphate-rich.

And he rates soil erosion as the biggest threat of all. The world’s population could reach 10 billion within half a century — perhaps twice as many human beings as the planet’s overtaxed resources can sustainably support, perhaps six times too many.
And why he thinks the results of the famous Ehrlich-Simon bet didn't really settle the matter; if we extend the original bet past its arbitrary 10-year limit to the present day, Ehrlich wins the five-commodity bet 4-1, and he wins big if the bet is further extended to all important commodities.
“The prices of all important commodities except oil declined for 100 years until 2002, by an average of 70 percent. From 2002 until now, this entire decline was erased by a bigger price surge than occurred during World War II. Statistically, most commodities are now so far away from their former downward trend that it makes it very probable that the old trend has changed — that there is in fact a Paradigm Shift — perhaps the most important economic event since the Industrial Revolution.”
When prices go up and stay up, it’s not a bubble. Prices may always revert to the mean, but the mean can change; that’s a paradigm shift. As Grantham tells it, oil went first. For a century it steadily returned to about $16 a barrel in today’s currency, then in 1974 the mean shifted to about $35, and Grantham believes it has recently doubled again. Metals and nearly everything else — coal, corn, palm oil, soybeans, sugar, cotton — appear to be following suit. “From now on, price pressure and shortages of resources will be a permanent feature of our lives,” he argues. “The world is using up its natural resources at an alarming rate, and this has caused a permanent shift in their value. We all need to adjust our behavior to this new environment. It would help if we did it quickly.”

Saturday, August 13, 2011

Stephen Colbert's SuperPak promotes Rick Perry. No I mean Rick Parry

In the interest of the 24 hour news cycle and all things political, its time to analyze the significance of the first foray into the political realm by Stephen Colbert's superpak, Americans for a Better Tomorrow Tomorrow. The last couple days, these two ads have aired in Iowa.

So, what's up? Why would Colbert have targeted Perry and, in particular, drawn attention to his candidacy and asked people to write in the misspelled name of Rick Parry? And why pick the rather obscure venue of the Iowa straw poll? Answers after the jump ... so read on.

Thursday, August 11, 2011

Global Economy: Are we approaching Peak Standard of Living?

Back in 1956, M. King Hubbert advanced the basic idea behind peak oil theory: the recognition that for any given geographical area, from an individual oil-producing region to the planet as a whole, the rate of petroleum production tends to follow a bell-shaped curve. For example, the chart contrasts Hubbert's prediction for the continental US against observed data. The implications of the idea -- that once a peak occurs the slide downward is inexorable and unstoppable -- have resulted in lots of attempts to determine the peaks of various regions and the globe as a whole.

Hubbert, while famous for applying the idea to oil, viewed it as a process applicable to a wide variety of natural resources. Indeed, he got the idea from an study of coal resources done in the 1920's. Thus, not surprisingly, the idea has spread to other areas. The most expansive treatment occurs in Richard Heinberg's Peak Everything: Waking Up to the Century of Declines which argues that the twenty-first century ushered in an era of declines, in a number of crucial parameters.

While peak oil types have spent lots of time and energy examining the relationship between energy and the economy, the bulk of the analyses are similar to this (where they measure economic activity in terms of gross domestic product (GDP) or this (where economic drivers such as productivity are the focus). But, at the experiential level of the individual, a much better approximation of the key economic measure is not total GDP but GDP per capita (per person).

What follows are figures calculated from Angus Maddison's annual data for worldwide GDP. They show that, despite the rapid expansion of the BRIC economies, the global rate of economic growth since 1974 is LESS than it was from 1951-1973.

per capita GDP growth rate
World Average
         World,           excluding China
- 1973
- 2003

- 1960
- 1970
- 1973
- 1980
- 1990
- 2000
- 2003

So we see that GDP per head grew at a pretty constant average annual rate of about 3% per year through 1973. Toward the end of 1973, the global crisis erupted. Since that point, GDP per head has again grown at a pretty constant average annual rate. But that rate of growth is only slightly more than half the rate during the postwar boom, or slightly more than 1/3 the rate during the postwar boom if China (with its dubious official economic data) is excluded.

What the data show is a clear slowing in the rate of growth -- the global standard of living is still increasing (the values are still positive), but the rate of increase in per capita GDP is less than it was prior to 1974. Placed in the context of peak oil theory, this suggests that the global economy -- understood as the average global standard of living -- is nearing its peak.If you look at the graph above, you will see an S shape leading up to the peak -- growth begins slow, then there is a period of rapid growth (where the curve rises steeply) and, just before the peak, you get another inflection (change in the rate) as the curve flattens out near the peak. It is this flattening out immediately prior to the peak that Maddison's data captures.

(Technical note:  Angus Maddison's annual data for worldwide GDP, which span the 1950-2003 period, are available at www.ggdc.net/maddison/Historical_Statistics/horizontal-file_03-2007.xls. Maddison is the world's foremost expert on economic growth and its measurement. His GDP figures are measured in 1990 international dollars (Geary-Khamis dollars). Above, the average annual growth rate for each period is the mean of the annual growth rates; the results are almost identical if one estimates a continuous growth rate throughout the period based on the start-of-period and end-of-period figures.)

Tuesday, August 9, 2011

Panarchy, the President, and a Whack-a-mole approach to countering terrorism

The Foreign Policy article Mission Not Accomplished disputes the claim by US Secretary of Defense Leon Panetta that al Qaeda's defeat is "within reach."
Although U.S. counterterrorism efforts have indeed substantially weakened the organization, Panetta's comments miss the bigger point about the terrorist threat facing the United States. Over the past decade, that threat has morphed from one led by a hierarchical al Qaeda organization into something much more diffuse, with a greater presence online, that no longer depends on orders from senior leaders in Pakistan.
Viewing the terrorism threat as solely embodied by al Qaeda as a discrete and hierarchical organization is both inaccurate and dangerous. The more important metric is the popularity of the Islamist movement generally and the jihadi movement specifically. Although it is difficult to measure, its online presence has undoubtedly grown rapidly over recent years. The jihadists' media capabilities have expanded considerably over the past 10 years, and that content can easily be found across the Internet, even on the most mainstream of websites.
Al Qaeda as we knew it 10 years ago may be no more. But at the rate it has been adapting, it seems likely the United States will be at war with this enemy for another decade. Whether individuals can be mobilized by AQAP's media or that of other jihadi outfits to carry out effective attacks on the United States without training overseas is the most important question in counterterrorism and will likely remain so for years to come.
On Aug. 3 the White House took a good first step in creating a framework to counter violent jihad, in releasing "Empowering Local Partners to Prevent Violent Extremism." But it is just that: a framework. Ten years after 9/11, this document marks the U.S. government's first concerted policy effort at countering radicalization. Certainly, it is coming years too late, but it is also short on detail and built largely around the concept of community engagement. Community engagement has been the centerpiece of British and Australian efforts to counter radicalization for at least the last four years. What those programs lacked was an element that confronted the ideology of militant Islam, at the national level and online. Emphasizing local community efforts is a logical endeavor, but the jihadi message is global and focused on Muslim suffering abroad, not on local issues in London, Melbourne, or Chicago. Eventually, Washington will have to confront the underlying ideology of militant Islam, not just its byproducts.

In other words, Al Qaeda hasn't decentralized so much as it has franchised. There remains a global ideology. Or, in panarchy terms, the network has presence at the local level (individual cells), the national level (loose network within a particular region) and the global level (typically more in terms of ideology than direct interpersonal contact). As the article points out, the focus on (local) community engagement fails to confront the ideology of militant Islam either at the national level or online.  Or, to render the problem in panarchy terms, the approach omits consideration of cross-scale interactions -- particularly the remember interaction whereby lower-level processes (local organization) are rejuvenated through access to resources from the higher levels. In practical terms, you can't only play whack-a-mole at the local level and be successful.

Monday, August 8, 2011

Bodies, Big Brains and Regulatory Reform

When I started this post, it was just a listing of two things I found interesting. Then I realized they were connected. So... what are the two articles?

  1. A Body Fit for a Freaky-Big Brain, summarizing research on the anatomical adaptations necessary to accommodate our over sized brains -- which use 20 times as much energy per pound as muscle tissue. Among the factors identified: reduction in the amount of gut tissue (also very energy intensive); shifting of diet to a higher energy cuisine based on seeds, tubers and meats; and a genetic adaptation in glucose transporters that resulted in extra molecular pumps to funnel sugar into the brain, while starving muscles by giving them fewer transporters.
  2. Individuals interested in takes on the financial collapse will want to check out Capital Inadequacies The Dismal Failure of the Basel Regime of Bank Capital Regulation. Put out by the libertarian Cato Institute, the paper provides 40 pages or so of analysis aimed at a) documenting that regulatory solutions to financial matters are misplaced because regulatory apparatus is subject to capture and b) advocating a solution based on financial laissez faire.
The solution is free banking or financial laissez faire. The state would withdraw entirely from the financial system and, in particular, abolish capital adequacy regulation, deposit insurance, financial regulation, and the central bank, as well as repudiate future bailouts (and especially the doctrine of Too Big to Fail). ... Such systems have worked well in the past, and reforms along these lines would take the United States a long way back to its banking system of a century ago, in which banks were tightly governed and moral hazards and risk taking were well controlled because those who took the risks bore their consequences.

Now we can debate the empirical validity of these claims -- the individuals who lost all their savings in the bank runs of the Great Depression probably wouldn't agree that "those who took the risks bore their consequences" -- but that isn't the point.

Compare the view of systems and adaptation in the two scenarios. In the first article the "system" is the human body. The basic argument is that modification of one major subsystem (the brain) necessitated modification to other parts of the system in order for the "big brained" version of humans to survive. Contrast this with the view of the economic system advanced in the Cato Institute analysis. Over the past century the economy has changed dramatically. The growth of financial services as the mainstay of many advanced economies is the equivalent of the emergence of big brains -- one particular part of the system is becoming unusually important. A century ago, advanced economies were based on manufacturing and agriculture. Today, these sectors play a comparatively minor role and financial services (conventionally rendered as Wall Street) rule. But, rather than recognizing that change in one part of the system requires an adjustment in other parts of the system, the Cato paper argues for stability in the other aspects of the system (as expressed in the desire for a banking system similar to what was in place in 1910).

There is also a confusion Cato Institute paper about the role of organization (regulation) as it characterizes complex systems, but getting into that would be another (lengthy and necessarily technical) post.

Saturday, August 6, 2011

Oh Canada, and other quick takes

  1. The Guardian reports on unprecedented lobbying efforts by the Canadian government aimed at maintaining an export market for oil from the tar sands.
    The lobbying effort, which includes dozens of meetings between Canadian and British government "representatives" and oil executives, was triggered by the release of a consultation document in July 2009 by the European commission, which attempted to definitively assess the "well-to-wheels" carbon intensity of different oils. The document attributed a "default" carbon value for traditional fuels of 85.8g of carbon dioxide per mega joule of energy for traditional oil and 107gCO2/MJ for fuel derived from tar sands.
    The Canadians have managed to delay the EU's original deadline of January 2011 for confirming baseline default values despite new peer-reviewed studies to support the European position. Darek Urbaniak, extractives campaign coordinator at Friends of the Earth Europe, said: "It is unprecedented that a government of one of the most developed countries can devise and implement a strategy that involves undermining independent science and deliberate misleading of its international partners."
  2.  Andrew Revkin has an interesting summary of material related to the Somalia famine in A Climate Scientist's view of a Famine's Roots. Among the problems identified -- a faulty IPCC projection.
    Funk says the 2007 projection of wetter conditions led some agencies to plan the expansion of agriculture in the region — plans that could be devastated if drier conditions prevail, as his work implies.
  3.  Individuals interested in collapse will want to click their way over to Foreign Policy -- where the current issue has several articles on the collapse of the Soviet Union, including the cover story Everything You Think You Know About the Collapse of the Soviet Union Is Wrong. And why it matters today in a new age of revolution.

Thursday, August 4, 2011

Padgett, Part III: Autocatalysis in the Economy and in Persons

This is the third in a series dealing with one of the most interesting ideas I've come across in a decade: the theory outlined in John Padgett's The Emergence of Markets and Organizations. For an overview of the book and description of the network perspective, see Part I. Part II provides a concrete illustration of the approach, the emergence of the partnership structure in Renaissance Italy. This  post summarizes the chemical process (autocatalysis) that Padgett uses as a conceptual model for understanding the production of goods and people. This post begins with a description of autocatalytic networks in chemistry and then applies the concept to economic production and, finally, to the production of persons.

Tuesday, August 2, 2011

World's strongest banks

There are two basic explanations for the recent global financial collapse. The first, the Marxist account, emphasizes the role of capitalist accumulation and, in particular, the ability of the financial classes to profit from asset bubbles. The second account emphasizes complexity and uncertainty. According to this account, lax regulation was a major contributing factor. In light of these competing accounts it is interesting to look at the information below, identifying banks in Singapore and Canada as the world's strongest. Both locations came through the crisis comparatively unscathed and both are noted for their relatively high level of bank regulation.