“If you're not part of the solution, you're part of the precipitate.” - Henry J. Tillman
This week, check out the interesting video about Green growth / no growth, in which it is argued that instead of not growing, the focus should be on growing sustainably. Indeed, the question about climate change is ultimately a politico-economic question which can roughly be summarized as: "who pays?"
The Western world has the money and means to transition away from fossil fuel addiction and decrease overall consumption, but the biggest problem is to fairly distribute the high costs involved with this conversion.
Yet, as countries still struggle internally and externally with a variety of crisis, no one is prepared to pay and the decision keeps being postponed. It so follows that it will be major events who will precipitate political action, but this means that by that time global warming will most likely be out of control -and that the answer may be badly crafted.
Science, General Knowledge & Environment
NASA: 2014 the warmest year on record – "Since 1880, Earth’s average surface temperature has warmed by about 1.4 degrees Fahrenheit (0.8 degrees Celsius), a trend that is largely driven by the increase in carbon dioxide and other human emissions into the planet’s atmosphere. The majority of that warming has occurred in the past three decades."
Green Growth or No Growth? – "In a Real News Network interview, Robert Pollin goes through the math of carbon output and shows why a no growth approach is inadequate. A separate issue that often goes by the wayside is that conservation efforts, contrary to conventional wisdom, can increase profits. For instance, BP in 1997 decided to lower its carbon emissions below the 1990 level by 2010. It achieved the goal in 3 years rather than 13 at a cost of $20 million. Oh, and it happened to save $650 million."
History & Geopolitics
Charlie and Theo – "But to equate Theo van Gogh or Charlie Hebdo with “democracy” or “Western civilization” seems too grandiose. One might as well claim that Al Qaeda in Yemen stands for Eastern or Islamic civilization."
The European Union, Nationalism and the Crisis of Europe – "Neither perpetual peace nor perpetual prosperity can be guaranteed, therefore the joy that would overcome custom and bind men in brotherhood is a base of sand. In the European Central Bank's compromise with Germany, we can see not only the base of sand dissolving but also the brotherhood of Europe falling apart."
Russia's Plans for Arctic Supremacy – "For half a century, the Arctic was an area of U.S.-Soviet friction and the site of numerous incidents that could easily have led to conflict. Even in a post-Cold War world, the region could once again be transformed into a zone of frozen conflicts. The great powers have long competed over the Arctic, and now countries such as China and India are expressing their own interest in the region."
Red Alert Update: At the Heart of the Mariupol Crisis – "Good strategy involves creating options while withholding commitment to any particular course until the political and diplomatic possibilities are played out in the context of a build up. It would seem to us that this is what the Russians are doing, while signaling capability if not yet intent. However, the Americans sending the commander of the U.S. Army to Kiev on a very public visit is a signal that the window is closing. That forces Russia to make decisions sooner rather than later."
Conversation: Reassessing Organized Crime in Mexico – [Video] – "Stratfor Vice President of Tactical Analysis Scott Stewart and Mexico Security Analyst Tristan Reed discuss the Balkanization of the drug cartels in Mexico."
Finance & Economics
New Oxfam report says half of global wealth held by the 1% – "Extreme inequality is not just an accident or a natural rule of economics. It is the result of policies and with different policies it can be reduced. I am optimistic that there will be change. A few years ago the idea that extreme poverty was harmful was on the fringes of the economic and political debate. But having made the case we are now seeing an emerging consensus among business leaders, economic leaders, political leaders and even faith leaders."
So Where Did All the Energy Debt Go? – "Total US CLO issuance in 2014 was about $120 billion (the most ever) and about $85 billion in 2013. If energy debt didn’t exceed 15% of the CLOs issued in those years, that means CLOs bought less than $31 billion of energy debt, vs. around $200 billion of total energy debt issued. Mutual funds had been big buyers of leveraged loans, but were net sellers by the second half of 2014. So who was buying all of those energy related leveraged loans – about $170 billion worth?"
Pettis: Debt will keep slowing China – "Even if the right reforms were implemented, until debt was written down significantly the GDP growth rate consistent with no increase in the debt burden (i.e. debt did not grow faster than debt-servicing capacity) is much lower than current growth rates – some even believe it is negative (I think the sustainable growth rate is no higher than 3-4%)."
Conversation: China's Economic Slowdown and the Necessity of Reform – [Video] – "Stratfor Managing Editor Ben Sheen and East Asia Analyst John Minnich discuss the Chinese government's struggle to maintain economic stability and implement key reforms in 2015."
Number of the day: "Oxfam made headlines at Davos last year with a study showing that the 85 richest people on the planet have the same wealth as the poorest 50% (3.5 billion people). The charity said this year that the comparison was now even more stark, with just 80 people owning the same amount of wealth as more than 3.5 billion people, down from 388 in 2010."
Picture of the day: Bird's Eye View
Written by Carlito
About Carlito Riego
"Great perfection may appear imperfect, but its usefulness is inexhaustible. Great abundance may appear empty, but its usefulness cannot be exhausted. Great correctness may appear twisted, great skills appear crude, great eloquence appear awkward. Activity conquers cold; inactivity conquers heat. Clear serenity governs the world." - Lao Zi