ANALYSIS & SYNTHESIS OF SHORT-TERM TACTICAL INTERDEPENDENCIES
Methods for analysis of short-term tactical interdependencies include precedence diagrams, interdependency matrices, and optimization techniques such as linear programming. Software is readily available to do the number crunching.
The following are recent contributions to tactical optimization of energy systems:
NOTE: For the list of links to online references reviewed inn previous issues, click here.
1. Global Citizen Movements & The Occupy Movement
"The term Global Citizens Movement (GCM) refers to a profound shift in values among an aware and engaged citizenry. Transnational corporations, governments, and non-governmental organizations (NGOs) remain powerful actors, but all of these are deeply influenced by a coherent, worldwide association of millions of people who call for priority to be placed on new vales of quality of life, human solidarity, and environmental sustainability. It is important to note that the GCM is a socio-political process rather than a political organization or party structure." Global Citizens Movement (GCM), Encyclopedia of Earth, November 2007.
"I think they're really touching a nerve," Sen. Bernie Sanders said Tuesday of protests on Wall Street that have inspired demonstrations from Burlington, Vt., to Los Angeles. "The nerve is that the average American understands that as a result of the greed and the recklessness and the illegal behavior on Wall Street, these guys plunged us into the horrendous recession that we're in right now." Even Federal Reserve Chairman Ben Bernanke allowed that there was "excessive risk taking" by Wall Street when Sanders questioned him on Tuesday about the root causes of the recession and the concerns voiced by protesters. "They blame, with some justification, the financial sector with getting us into this mess," Bernanke told another member of the Joint Economic Committee. "I can't blame them," he added.
As the Wall Street protests have spread from New York City to the rest of the country, some media pundits have criticized the protesters for being unfocused — as if there were only one thing wrong with the financial sector of the U.S. economy. The protests have provided a welcome response to Wall Street’s massive takeover of governance, and continued opposition to the status quo could produce opportunities to enact real reforms.
Don’t expect Wall Street to undertake such reforms voluntarily — some of the shady practices are too profitable. It’s going to take new laws, and key legislation is pending in Congress that could provide important remedies. But new legislation won’t pass without the strongest pressure. That’s where the protesters could make a difference, especially with some forceful activity in the districts where the obstructionists, like House Majority Leader Eric Cantor from Virginia, reside. Cantor said to the conservative Values Voter conference: “I, for one, am increasingly concerned about the growing mobs occupying Wall Street” but he backtracked a week later when cautioned by his political finger-in-the-wind testers about the growing popularity of the protests.
Among all the morally bankrupt practices on Wall Street, there’s one in particular that would be easy to abolish. Easy, that is, if we can translate some the energy of the protests into pressure on lawmakers. Pending in Congress are powerful bills such as Senator Levin’s S. 1346 (Stop Tax Haven Abuse Act of 2011) that would strike hard at tax dodgers. But a bill like that has no prayer of passage unless representatives like Cantor feel the pressure.
Instead of reform, Congress is in fact poised to give another “one-time only” tax holiday to companies that stashed profits in tax havens. Huge and wealthy U.S. corporations are actively seeking what is known as a “repatriation holiday” because they say it would create jobs. Such a holiday would allow them to bring home offshore profits at a reduced rate — a nice holiday for the well-to-do CEOs and shareholders, while the rest of us taxpayers suffer the consequences of losing $80 billion of revenue.
The Tax Justice Network and a number of small business associations are trying to right this wrong. They have sent a letter to Congress to dispute this repatriation holiday, noting: “Too many corporations have turned their tax departments into profit centers, using aggressive accounting manipulation to disguise U.S. profits as foreign profits.”
Bloomberg Business Week has pointed out prime examples: Google reduced its income taxes by about $3.1 billion over three years — first by shifting income to Ireland, then to the Netherlands, and finally to Bermuda. Another example is Forest Laboratories, a company that sells over 99% of its drugs in the U.S. but attributes the bulk of its profits to a law office in Bermuda.
Corporate abuses are all the more frustrating in light of how the Congressional “Supercommittee” is discussing the deficit. The Supercommittee is poised to recommend draconian cuts in important programs, but its Republican members are unwilling to address tax havens and tax dodgers that cost the U.S. Treasury an estimated $100 billion per year. The two biggest banks benefiting from taxpayer bailouts are Citigroup with 427 subsidiaries in tax havens and Bank of America with 115.
A recent report by the Institute for Policy Studies (IPS) adds more grist to the protesters’ mill. The report notes that the salary of chief executives (CEOs) of the S&P 500 soared 27.8% in 2010 to $10.8 million, making the ratio between average CEO pay and average U.S. worker pay now 325 to 1. Back in the good old days of 2009, the ratio was much more equitable at “only” 263 to 1. The IPS study found that 25 of the top 100 CEOs received more pay than their companies paid in federal income tax. Furthermore, 20 of these 25 companies spent more on lobbying than they paid in federal income tax.
One more recent analysis, published in the journal of the Association for Psychological Science, provides new support for those advocating major reforms in the tax code. The analysis found that those countries with the most progressive tax codes (those that are the exact opposite of a flat tax where everyone regardless of income pays the same rate) had the highest happiness ratings.
Americans want a sustainable and fair economy. But we won’t get one without fundamental financial reforms and a clamp-down on tax dodgers. And we won’t get that without applying pressure to lawmakers and corporations. Now that’s a good focus for a protest.
A high priority of global citizenship is education, either informally through personal contacts and public means of communication such as the internet, or more formally via programs sponsored by educational institutions. At a time when both developed and developing nations seem to be engulfed in political and financial corruption, education in noviolence is especially important. If a global revolution is coming, let it be a nonviolent revolution!
If a global revolution is coming, let it be a nonviolent revolution!
Education for Sustainable Development (ESD) worldwide - at all levels - is a high priority. UNESCO has a worldwide program, but universities and other educational institutions must contribute. The family is the best school of sustainable human development.
It is widely acknowledged that sustainable development is a long-term goal, which both individuals and institutions (and countries!) need to pursue. This important theme is characterized by an intrinsic complexity, since it encompasses ecological or environmental considerations on the one hand, and economic matters, social influences and political frameworks on the other. This makes provisions in respect of education for sustainable development a particularly challenging task, but one which is feasible and achievable, provided the right elements are put into place. This book is an attempt to foster the cause of education for sustainable development, by documenting and disseminating experiences from different parts of the world, where learning for, about and through the principles of sustainability is taking place, in various sets and contexts, in both industrialized and developing nations. A special feature of this book is that it not only presents a wide range of philosophies, approaches, methods and analyses with respect to education for sustainable development across the world, but also documents and disseminates concrete case studies, which show how education for sustainable development may be realized in practice.
ESD best practices should include practical (and field tested) means to advance public policy for sustainable development. It is hoped that ESD will overcome the ambiguity of the term "sustainable development" to make it clear that infinite growth in a finite planet is a practical impossibility in the long-term. What really matters going forward is "sustainable human development."
The so-called "soft means" to advance public policy seek the support of the humanities and social sciences to enhance the formulation and implementation of public policies. A classical example, on political philosophy, is The Republic of Plato. More recent examples are the writings on nonviolence by Mahatma Gandhi and Martin Luther King Jr. Engagement in the political process, and adherence to the principle of nonviolence, are tactics of choice for "global citizen" organizations.
Collecting and sharing standardized and comparable data among member states
Making international comparisons and applying peer pressures (including "benchmarking") to align policy among member-states and other social agents.
It is often the case that "soft methods" are not persuasive, and more tangible incentives (positive or negative, but always nonviolent) are appropriate. The following section is about reforming tax codes so as to mitigate greedy (and irresponsible) human behavior in financial markets.
There are taxes that focus on depletion of natural resources ("depleter pays principle") and/or the deterioration of natural resources ("polluter pays principle"). One key tax reform proposal that deserves further consideration is the "Land Value Tax" (LVT), originally proposed by American economist Henry George in 1879. The underlying concept is to shift tax burdens from earned incomes to unearned incomes.
Hartzok, Alanna. The Earth Belongs to Everyone, Earth Rights Institute - Institute for Economic Democracy Press, 2008. See pp. 190-192 for data on global maldistribution of wealth.
"To measure a country's greenhouse emissions from fossil fuels, it makes sense to consider the whole carbon supply chain, from oil well or coal mine to a consumer's shelf, researchers wrote in the journal "Proceedings of the National Academy of Sciences." Currently, putting a price on climate-warming carbon dioxide generated by oil, coal, natural gas and other fossil fuels typically takes place where the fuel is burned. However, the scientists suggest that as a practical matter, it could be most efficient to administer any so-called "carbon tax" at the point of extraction. The scientists analyzed fossil fuel extraction, combustion and consumption in 112 countries and 58 industry sectors. They learned that 51 percent of all carbon dioxide emissions from human activities stemmed from fossil fuels or goods that were sent across borders to get to consumers. They found that 67 percent of global carbon dioxide emissions would be covered if regulation of fossil fuels was done at the point of extraction in China, the United States, the Middle East, Russia, Canada, Australia and India." Source: Sustainable Energy Network, 21 October 2011
Assuming that land/resource value taxes are set high enough that they yield a surplus of public revenue, how is this surplus to be distributed back to all citizens?
Basic Income Earth Network (BIEN). Basic Income Earth Network (BIEN), Note: The Basic Income Earth Network was founded in 1986 as the Basic Income European Network. It expanded its scope from Europe to the Earth in 2004. Web site as of 30 May 2011.
Work dignifies the working person, and quality work even more so. This applies to all kinds of work, from the most humble to the most exalted. The objective of guaranteed basic income is not to induce laziness but to liberate people from a salary system that incentivizes conformance rather than creativity. To ensure that this is the case, quality standards are needed.
All humans have a propensity to cut corners. Regardless of how income is taxed (Section 5) and returned (Section 6) to tax payers, there is a continuing need for quality standards in all kinds of human work.
What about quality standards for financial institutions? ISO 9000 could be used, but it would seem that the financial services industry should have a dedicated five digit standard (such as the 50001 for energy).
8. Transferring Subsidies from Fossil Fuels to Clean Energy
The transferring of subsidies from the fossil fuels industry to the clean energy industry is understandably a sensitive political issue. The fossil fuel industry is enormously powerful. The age of fossil fuels has practically run its course. However, the temptation to keep producing and using "cheap energy" is very strong regardless of environmental consequences. The United States of America has yet to ratify the Kyoto Protocol because "it is bad for business." The "easy profits" derived from the exploding manipulation of worthless financial assets is also bad for business, but not yet recognized as such by the general public. Subsidies are tricky business, and there seems to be a paucity of expertise about the societal cost of subsidizing pollution-intensive industries.
"Global subsidies for fossil fuel consumption are set to reach $660 billion in 2020, or 0.7 percent of global gross domestic product, unless reforms are passed to effectively eliminate this form of state aid, according to the International Energy Agency. The IEA estimated such subsidies at $409 billion in 2010, compared to $312 billion in 2009. Oil products had the largest subsidies at $193 billion in 2010 while $91 billion went to natural gas. Iran and Saudi Arabia had the biggest subsidies. Leaders of the Group of 20 major economies committed in Pittsburgh in 2009 to phase out, over the medium-term, inefficient fossil fuel subsidies that encourage wasteful consumption. Eliminating fossil fuel consumption subsidies by 2020 would cut global energy demand by 4 percent and considerably reduce carbon emissions growth, the IEA said."
Beyond taxes and subsidies, what are other ways to incentivize the development and commercialization of clean energy?
Excerpt: "In late 2010, solar panel makers were sold out, Germany was gobbling up record numbers of the clean energy systems, and new markets were steadily growing. Now, the erosion of subsidies in Germany and Italy, the world's two biggest markets, and rising production of the panels that turn sunlight into electricity has left the industry awash in a glut of equipment and driven panel prices down by some 35 percent this year. That is good news for consumers and distributors who buy the solar modules, but has left manufacturers reeling as their profit margins shrink and their share prices plummet to multi-year lows. Consequently, some companies have gone bankrupt. However, solar analysts have been quick to point out the young industry is now weeding out the weaker companies, and that prices for solar power are quickly approaching parity with electricity generated by fossil fuels, which is crucial for reducing its need for government subsidies. That in turn is helping spur its growth in the United States, where installations could double this year to more the 1.5 gigawatts." Source: Sustainable Energy Network, 23 October 2011.
Excerpt: "Oil and natural gas companies, pension funds and other blue-chip firms are likely to raise their investments in renewable-energy projects, thanks to shrinking costs and a faster turn around compared with nuclear power, according to a study from Swiss bank Sarasin. Banks, which tend to have a more cautious lending philosophy after the financial crisis, are more willing to lend to wind power projects with a 12 to 18 month realization time-span, for example, compared with nuclear plants, which need 10 to 15 years. The renewable-energy industry "will become the target of progressive oil and gas companies and utilities, and of blue-chip firms in conventional industries," a researcher said. Global renewable energy was the fastest growing energy sector in the past decade, reaching $200 billion in 2010, up 25% from 2009, the report showed." Source: Sustainable Energy Network, 23 October 2011.
Excerpt: "A new survey says 79 percent of bioenergy executives are more optimistic both about their organization’s prospects for growth and industry growth, than 12 months ago, and that 72 percent are more optimistic about the industry’s prospects than at this time in 2010. Overall, the survey painted a picture of an industry that is expecting to grow at nearly triple the growth rate of the world economy (8.9 percent for the industry, compared to 3.2 percent for the total economy), but expecting to find generally less external support in the form of tangible support from government, and less IPO activity. Though 50 percent of respondents expect the cellulosic ethanol sector to reach 1 billion gallons in capacity, 67 percent indicated the same belief in Q1 of this year." Source: Sustainable Energy Network, 23 October 2011.
Excerpt: "University of California - Davis West Village is the largest planned zero net energy community in the US. Located on the University of California/ Davis campus, the community is designed to generate as much energy each year as it consumes, and to demonstrate that this can be done on a large scale. The first $280 million phase is complete - it has 315 apartments, 42,500 square feet of commercial space, a recreation center and village square. Final build-out is expected in fall 2013. When completed, the 130-acre development will be home to about 3,000 people in 662 apartments and 343 single-family homes." Source: Sustainable Energy Network, 23 October 2011.
Investing in Clean Energy Technologies and Commercialization