Friday, October 16, 2015

Which countries are doing the most to stop dangerous global warming?

The Guardian

Pith of the pith:

Intended Nationally Determined Contributions (INDC) of most of the countries, ahead of Paris conference in November, have been ambitious. However, they yet fail to cap the global carbon emissions to levels which will prevent the rise of world temperature by 2° C.

The pith:

The INDC announcement, context, ability to deliver of major countries is explained below.

China:

INDC: Ambitious target of reducing carbon emissions per unit of GDP by 60-65% by 2030 as compared to levels of 2005. Hopes to peak emissions by 2030

Context: China is the largest carbon emitter in the world. After the breakdown of Copenhagen discussion of 2009 due to inflexibility of China, the approach of China has changed.

Ability to deliver: With the rising problem of air pollution and slowing economy, China is expected to peak before 2030.

USA:

INDC: cutting back of carbon emissions by 26-28% of 2005 levels by 2025

Context: US is the 2nd biggest emitter on the planet. Largest emissions come from power plants. Obama administration has been quite firm on climate change policies despite Congressional opposition which is controlled by Republicans.

Ability to deliver: Uncertain. Congressional opposition might lead to roll back on some climate change legislations. 2016 elections will decide.

European Union:

INDC: 30% reduction on 2005 levels by 2030

Context: 3rd largest emitter as a group. The European Parliament has been quite vocal on climate change policies and the INDC is one of the most ambitious among industrialised countries.

Ability to deliver: The biggest certainty comes from public support to restrict climate change and renewable power. However, concerns are based nationally coordinated actions which seem to be in contrast. For instance, Poland's energy is based on coal and views decarbonization as a threat to its economy, while Germany aims to decarbonize its economy along with scrapping nuclear power by mid century (called "energiewende"). Also, automakers and energy companies have put pressure to moderate emission cuts.

India:

INDC: pledge to achieve 40% of electricity capacity through renewable and low carbon energy sources; reduce emission intensity (emission per unit of GDP) by 35% by 2030

Context: India is the 4th largest polluter. However, India of 2030 is yet to be built. 300 million people do not have access to electricity. Infrastructure for 1.5 billion people of 2030 is yet to be built.

Ability to deliver: The requirement of development and poverty alleviation will increase India's carbon consumption. However, the emission per capita is yet very low as compared to West and will stay so till 2030 even after an increase in emissions. However, India has started feeling the heat of climate pollution as its many cities are world topmost air polluted cities. Despite that, India has increased targets for solar and wind power plants, nuclear and thermal power plants. And yet, the ambitious INDC targets indicate that India is going to be an enthusiastic contributor to climate change negotiations.

Japan:

INDC: pledges to reduce greenhouse gas emissions by 26% of 2013 levels by 2030

Context: Fukushima nuclear disaster after the tsunami of 2011 has led to recasting of Japan's energy policy. The target has been described as weak by environmentalists.

Ability to deliver: After Fukushima disaster, Japan has closed most of its nuclear reactors and has been forced to import more coal, gas and oil for its energy needs. More coal based power plants are planned. Seems unable to achieve.

Brazil:

INDC: cut back emissions by 37% of 2005 levels by 2025; restriction on deforestation in Amazon rainforests

Context: Brazil has been noted as the most ambitious pledger as it has targeted absolute reductions (not as per unit GDP reductions) in contrast to other developing countries.

Ability to deliver: Brazil's growing economy requirement will place constraints on its ability to achieve. However, Dilma Rousseff has been criticised for keeping deforestation targets only Amazon forests and not nationwide (such as Cerrado forests which are being illegally cleared for soya plantations and ranches). However, the highly ambitious targets has made it the front leader in negotiations.

Russia:

INDC: cut back 25-30% of GHG emissions of 1990 levels by 2030

Context: Russia public sentiment is indifferent on the issue of climate change. The vast areas of icy forests are supposed to serve as carbon soakers and the public and political class sometimes dismisses global warming as helpful.

Ability to deliver: Russia's current energy policy has been impacted by slowing economy, sanctions due to Ukraine, falling oil prices. Actually it's emissions decreased in 2014. And it views the problem not as a medium term problem but a long term issue. However, Putin led to passage of a bill which mandates carbon emission reports by corporates despite massive resistance by industries. Anyways, the targets are modest.

The Families Funding the 2016 Presidential Election

http://nyti.ms/1VL43zy

Pith of the pith:

As the income inequality has widened in America, the control of corporate families over electoral funding has increased. A majority of them are funding the Republican policies of reduced regulation, reduced taxation on income and capital gains.

The pith:

After the Citizens United judgement of US Supreme Court in 2010, the ease of corporate funding to electoral candidates (for presidential elections) has increased.

For 2016 Presidential Election, in the 1st round, around 158 families with their privately held companies, have donated around $180 million. These families are mostly involved in finance (hedge funds) and energy (shale and oil) businesses.

138 of these families have supported Republican candidates who support reduced regulation, reduction in income taxation and on capital gains and shrinking entitlement programs.

However, the sentiment of the American public is at variance. 2/3rd of Americans want taxation for million dollar income earners increased. Around 70% of people want increased medical and social security assistance.

Also, some families have supported Democrats who pursue restrictions on hedge funds and venture capitalists and progressive taxation.

Government trying to increase domestic opium production


Pith of the pith:

India is the one of the few countries which legally cultivates opium and the only country which legally produces opium gum. Opium gum is used in manufacture of morphine (world's best analgesic), codiene (used in cough syrup) and thebaine.

The pith:

Only 3 states, MP, UP, Rajasthan, are allowed to cultivate opium through licenses given to farmers.

The crop season is from Oct to March.

Opium latex is collected from farmers and sent to Government Opium and Alkaloid Works, whose capacity has recently been increased. From there, opium gum is extracted and sold to pharma companies.

This year, India looks to increase the opium cultivation as the stock of opium gum has reduced due to higher domestic consumption and higher export.

Breaking the bonds of rural poverty


Pith of the pith:

Social protection schemes, even cash transfers, do not generate dependency but help in reducing poverty & chronic hunger and increase in investment by extreme poor towards long term income generating activities such as education and health.

The pith:

The proportion of extreme poor has reduced from 43% in 1990 to 17% today. 72 of 129 countries monitored by FAO have been able to achieve the MDG of halving the undernourished population by 2015.

However, around 800 million people continue to remain extremely poor and around 1 billion are chronically hungry. Also, the achievement of MDGs has been uneven.

Extreme poor are caught in the circle of survival activities which forces them to engage in low risk and low return activities and when any unexpected vagaries come, they reduce their expenses further by withdrawing children from education, cutting back expenses of health and food intake.

Social protection schemes can incentivise them to invest in long term income generating activities. So these schemes need to stay in place and expanded.

Is the digital economy in a bubble?


Pith of the pith:

Once advertisers realise that ROI from online advertising is low and subprime, they might withdraw from advertising on this medium at all. Then, the survival of internet will be at stake.

The pith:

The web is based on an economic model similar to TV advertisement model of second half of the last century. The content on the web is free while advertisers are charged for allocating space on the internet real estate.

However, this model of online advertising is not that sustainable as it is supposed to be. Google, which just won the legal suit filed by Viacom against YouTube regarding illegally broadcasting copyright content, spent 8 years to break even the business from YouTube after its $1.6 billion acquisition.

Marketing spend on online advertising is increasing. In 2014, all American advertising companies spent $180 billion on paid media out of which 28% was online spend and 10.6% on mobile. The rate of growth of online advertising expenditure has increased by over 17% since 2013. Google makes 95% of its $66 billion revenues from ads.

However, the click based online banners are not liked by all users. Tools of ad-blocking and non-genuine click-throughs have made internet advertising spend suboptimal. Only 1 out of 1000 users click on an add. Around 72% of ads are inappropriately placed w.r.t. content.