Wednesday Night #1309

4 April 2007
Please let us know if you can be with us – we need to hide the Easter eggs!
As we hear the hippity hoppity of Easter Rabbits advancing along the bunny trail, scattering Easter eggs as they go (is this zoologically possible?), we are happy to welcome Gerald Ratzer back from smog-ridden Shanghai and Cleo Paskal, in the throes of final edits of her book on geopolitics and climate change, from India. Neither is an Easter Bunny, but each brings more to the table than painted eggs.
It’s difficult to come up with a topic that equals last week‘s post-election review with Yves Séguin in terms of timeliness and general interest. Somehow, the 25th anniversary of the outbreak of the Falklands War doesn’t cut it . And there’s no point in commenting on the crisis over the arrest of the British sailors by Iranian authorities. Both sides appear to now want to solve the problem through diplomacy and the less said by the rest of the world, the better. The situation in Ukraine is worthy of consideration, if only we fully understood the subtleties of what is happening. Finally, there is Zimbabwe, surely one of the most irritating unsolved problems of the day, but one which nobody seems willing or able to resolve.
Still no strong indicator on the possibility of a federal election here, although at least one Wednesday Nighter, pointing to the new attack ads and the unveiling of the Conservative campaign headquarters suggests April 12 may be D-rop-the-writ Day.
However, among developments this week that merit our attention, we would start off with the topic we did not touch last week: the Environment.
The Intergovernmental Panel on Climate Change (IPCC) meeting in Brussels this week is expected to finalize the report by over 2,000 scientists on how warming will affect the globe and what humans can do about it. To our astonishment Fox News carries a credible background story
The US Supreme Court meantime has ruled that the EPA has the authority to “regulate heat-trapping gases in automobile emissions” and moreover, that EPA cannot avoid its responsibility to regulate greenhouse gases unless able to provide a scientific basis for its refusal (not too likely given the findings of the IPCC, although in Bush-land all things are possible).
At our local level, the Tremblay administration continues to astonish with its latest proposal from Ville-Marie borough Mayor Benoit Labonté that recycling “green boxes” be replaced by plastic bags – and this less than two weeks after the release of the new Montreal Sustainable Development plan. Henry Aubin says it all today.
Other items
Isn’t it interesting how predictably the Conrad Black trial is moving off the front pages, as testimony deals with office procedures and transfers of funds from one company to another, rather than personalities, and possibly also as a consequence of Lady Barbara’s absence from the courtroom.
The sale of Chicago’s Tribune Co. including the Los Angeles Times to Sam Zell, known apparently as the “gravedancer” because of his enthusiasm for purchasing businesses in decline, is generating some controversy, mostly concerning the L.A. Times ownership which has attracted California bidders. There are the inevitable questions from the staff about an owner who knows nothing about newspapers. Maybe they would prefer Lord Black?
Lots of comment – and not all flattering – on the news of the announcement that the feds have revived the old Liberal Technology Partnerships under a new guise and will hand out $900 million to the aerospace industry to help finance innovation. Wednesday Nighter Sean Silcoff has some unkind comments
Income trusts are again/still in the news. This time because they are being sold at an increasing rate, largely to foreigners and private equity players, but Finance Minister Jim Flaherty rejects the charge by critics that the Harper government’s controversial income trust tax is in some way to blame. Forgive us for mentioning that there is something that sounds bit hollow about the denial.
We apologize for the absence of weighty commentary, but Spring is in the air despite forecasts of flurries, Passover and Easter are fast approaching and even our favorite Al Jazeera fails to ignite passions today.
Do join us and by all means, bring your own items for consideration. If you cannot be with us, we wish you a very Happy Easter/Passover and look forward to seeing you soon.

The Report

On the eve of Friday’s publication of the second report of the Intergovernmental Panel on Climate Change, Cleo Paskal’s presence served as a beacon for the evening’s discussion.

Climate/Environmental Change
The popularization of the climate change issue thanks to the persistence of Al Gore in publicizing “An Inconvenient Truth” – a reasoned, albeit alarming, science-based assessment of the effects of climate change on the world – has led even the board rooms of this and other nations to bandy about terms such as sustainable development without, in many cases, much understanding of the term, its implications or its relationship to other environment and development issues such as climate change, the loss of biodiversity, the UN Millennium Development Goals, the pressures of population increase, or the implications of bad hydrological planning . Sustainable development is not a new concept. Its roots are in the Club of Rome (1972) Limits to growth and the report of the Brundtland Commission Our Common Future published in 1987. The Brundtland Report defined sustainability as “a development, which fulfills the present needs without risking that future generations cannot fulfill their own needs” – a neat definition, but a difficult one to apply strictly to any and all corporate projects.
With the possible exception of very young children, almost everyone has heard the story of the three blind men and the elephant. The message was clear at the time, largely because we did not introduce such elements as the political correctness of using the term blind as opposed to sightless, or whether there was a possibility of political financial gain in inviting the sightless to touch various parts of the elephant’s anatomy, or even the hidden cost of the inevitable pollution caused by the by-products of the high volume elephant alimentation. A highly unlikely scenario you say? Not at all! Take, for example, the current discourse on climate change.
Almost nobody, it seems, denies its existence, but there appears to be considerable disagreement on the definition of the problem or proposed corrective measures, partly because of the NIMBY syndrome, but mostly through blindness, short-sightedness, or ignorance of the sometimes ultimate undesirable side-effects of desirable solutions. What is being debated is the cause(s) of climate change, which must be determined if proposed solutions are to be effective. Corporations are beginning to show signs of heeding the warnings, but it would appear this is sometimes less out of conviction regarding scientific arguments, and more out of a recognition that regulation is coming and this is a risk that needs managing.
It is now accepted wisdom that climate change has the potential to wipe off the map, a number of low-lying and island states and destabilize others. Vast populations will be forced to move as waters rise, or dry up. Arable land and sources of food supply will disappear. As species become extinct, valuable ecosystems will be fragmented, leading to further deprivations. Recognizing these factors, at the request of the UK, the UN Security Council will debate climate change as a security issue on April 17.
Experts caution, however, that climate change is only one aspect of environmental change and by limiting debate to climate change, world bodies limit solutions to control of emissions, etc., rather than looking at the total picture of development policies and practices. They point to other key elements such as the regulatory and engineering problems that caused the devastating effect of hurricane Katrina, along with the destruction of mangroves that strengthen the shoreline in favour of shrimp farming that contributes to the economy.
People are currently living in areas that will almost certainly be destroyed due to developing environmental conditions. For example, people are still building in the flood plains of Bangladesh, the ultimate result of which is inevitable. The global supply of arable land decreases as the population continues to grow. Such popular solutions to petroleum-based emissions as alcohol-based fuel from cereal crops do not take into account the population growth and possible creation of food shortages resulting in using arable land to grow edible crops as fuel. It is also true that a considerable amount of petroleum products is consumed in the production of ethanol from crops.

Water
The supply of potable water is declining. While climate change plays a part in affecting global water supplies, it is the pressure of increasing population growth that is at the root of the problem. Growing urban water supply and sanitation needs, particularly in lower- and middle-income countries, face increasing competition with other sectors. Rising incomes in other portions of the world population fuel demand for manufactured goods and environmental services and amenities, all of which require water.
According to the IPCC report, by 2020, up to 250 million people living in sub-Saharan Africa are likely to face water shortages. Parts of Asia would be endangered by the melting of glaciers in mountainous regions such as the Himalayas. Similar melting of European glaciers would endanger southern Europe.
“In Southern Europe, climate change is very likely to have negative impacts by increasing risk to health due to more frequent heat waves, reducing water availability and hydropower, endangering crop production, and increasing the frequency of wildfires,” the report says.
Seawater can be desalinated, but requires energy. Rainwater is used to recharge ground water in India, but reclaiming water from melting snow is not currently being done.

Pollution
There appears to be confusion between pollution and climate change. Although both problems are real and require attention, pollution in the air actually has a cooling effect on the climate. Particulate matter pollution (worst in 1960’s and 1970’s) actually protects against energy coming in.

Trains versus planes
On Tuesday, the TGV broke the world’s rail speed record when it hit 357 miles an hour in a test on part of the Eastern Europe TGV line. One guest, recently returned from Shanghai, marvels over the 8-minute MagLev train from the airport to downtown (at a cost of C$7), while deploring the pervasive smog that hangs over the city. North America is well behind Europe and Asia in conservation measures, where, for example, high-speed trains are often an economical, energy-saving alternative to air travel. While, in most parts of North America, the relatively sparse population density would not make this practical, it appears that California is looking at the possibility between Sacramento and San Diego.
If life is to survive on the planet, economics must give way to conservation.

Important links for climate change issues:
IPCC
BBC
CBC
The Economist
The Environmental Change Institute
UN Framework Convention on Climate Change
World finally agrees that climate change threatenes everyone
It’s not just about climate

On the Corporate World and Environmental Change:
… more talk around boardrooms about sustainability but they’re not doing anything about it and don’t understand it, but they’re worried about it.
Corporations are beginning to take note of the problem but they are not certain about what the problem is ….
The Economy – see also Jacques Clément’s Report
The Toronto Stock Exchange is at an all time high with metals at a five-year high, nickel at an all-time record and gold rising to $750. Crude oil has increased by fifteen dollars since January, but commodities are currently at or near their peak, fuelled by the growth rates of India and China; this is a commodity-driven market which has benefited the Canadian stock exchange
With corporations loaded with cash, mergers, acquisitions and leveraged buyouts are at a record level, over a trillion dollars. According to one analyst, with low inflation, the Canadian market will reach over 14,000, fuelled by gold and metals, before dropping to eleven or twelve thousand around mid to late July, which level will constitute a buying opportunity. The thing to watch for is the New York stock market with the dreaded double top.
Despite the great strength of the economy in the west of Canada, at least one expert predicts that growth will be closer to 2% maximum, but the U.S. is cause for great concern. Inflation, now at 2.7%, is the major problem, not economic growth.
Generally speaking as the prices of houses rise, there is an incentive to build new ones; as the prices fall, accompanied by mortgage foreclosing, the incentive diminishes
When the regulators permit no-money-down mortgages-what exactly do they have in mind?

Short Notes:
Wednesday Night consensus sees Conrad Black receiving no more than a slap on the wrist in court on either the original judgment or on appeal.
Lucienne Robillard has announced that she will not run again in Westmount-Ville Marie, with a federal election expected to be announced in the next three weeks. As a local convention is impossible to muster within this short period of time, Stéphane Dion will very likely be forced to name a candidate, an action that resulted in unwarranted resentment against Madame Robillard when she was so named by the then Liberal Leader.