- With the anniversary of Lehman Brother’s demise, the FT recalls the events of that fateful weekend last September. The NYT has reflections of three former Lehman employees, while a Guardian roundtable asks what lessons, if any, we’ve learned from the bank’s fall. Niall Ferguson, meanwhile, rails against those who argue “if only Lehman had been saved”. He suggests:

Like the executed British admiral in Voltaire’s famous phrase, Lehman had to die pour encourager les autres – to convince the other banks that they needed injections of public capital, and to convince the legislature to approve them.

- Sticking with matters financial and economic, Der Spiegel has an interview with the head of the IMF, Dominique Strauss-Kahn, on the Fund’s actions during the crisis and the potential for a new role for the institution going forward. Former MPC member, David Blanchflower, meanwhile, offers a telling insight into the inner workings of the Bank of England’s decision-making as financial meltdown ensued.

- Elsewhere, the WSJ reports on President Sarkozy’s call to broaden indicators of economic performance and social progress beyond traditional GDP, following the findings of the Stiglitz Commission. Richard Layard, expert on the economics of happiness, offers his take here, arguing that “[w]e desparately need a social norm in which the good of others figures more prominently in our personal goals”.

- Wolfgang Münchau, meanwhile, assesses the implications of an Irish  “No” vote in the upcoming referendum on the Lisbon Treaty.  “There is an intrinsic problem for the Yes campaign in Ireland”, he suggests, “which is that the core of the treaty was negotiated seven years ago. This is a pre-crisis treaty for a post-crisis world… If we had to reinvent the treaty from scratch, we would probably produce a very different text”.

- Finally, last week saw the German Marshall Fund of the US publish its Transatlantic Trends survey for 2009. Unsurprisingly, a majority of Europeans (77%) support Barack Obama’s foreign policy compared to the 2008 finding for George W. Bush (19%); though the “Obama bounce” was less keenly felt in Central and Eastern Europe than Western Europe. A multitude of other interesting stats – on attitudes to Russia, Afghanistan, Iran, the economic crisis, and climate change –  can be found here (pdf).

From yesterday’s Sunday Times, more news that all is not well with the Clean Development Mechanism:

The legitimacy of the $100 billion (£60 billion) carbon-trading market has been called into question after the world’s largest auditor of clean-energy projects was suspended by United Nations inspectors. SGS UK had its accreditation suspended last week after it was unable to prove its staff had properly vetted projects that were then approved for the carbon-trading scheme, or even that they were qualified to do so.

It is a source of never-ending frustration to me that this dog of a policy mechanism was ever set up. The CDM, in case you haven’t had the delight of making its acquaintance, is a mechanism that’s supposed to allow developing countries to benefit from emissions trading – without having emissions targets.

If you’re wondering how that’s supposed to work, then join the queue. This is the other kind of emissions trading, the one that isn’t cap-and-trade. It’s called baseline-and-credit. What happens is that you look at (say) a factory where you’re about to install spanking new energy efficiency equipment. The idea is that you get issued with emission permits adding up to the level of emissions you’re saving by installing said technology. The problem, though, is that in order to do that, someone has to work out what the emissions would have been without it. And who the hell knows – really?

Back when the government set up the UK Emissions Trading Scheme in 2001 / 2002 (before it was superseded by the EUETS), I spent four surreal months as an official seconded in to Defra – where I was in charge of developing the baseline-and-credit part of the Scheme.  It was abundantly clear that it wouldn’t result in real emissions reductions. But companies loved it – as well they might. And as for the consultants charged with designing and accrediting the projects: it was Christmas.

Now, with the Clean Development Mechanism (CDM), it’s all gone global – and the same basic design problems are still, unavoidably, built in. So who has an incentive to say that the emperor wears no clothes?

Not developed country governments: they love the fact that it helps them to achieve their emissions targets cheaply (as you can see from the fact that a fifth of EUETS permits are from the CDM, or from the huge reliance on the CDM built into Waxman-Markey in the US). Not developing country governments: China and a couple of others are making money out of it, and the gripe you hear from the rest of them is not that the system is bust, but that they’re not getting a piece of the action. And certainly not the UNFCCC Secretariat (who are supposed to be impartial in all this): their little secret is that a levy on CDM transactions funds a lot of of jobs at their HQ in Bonn.

Which might leave you wondering why the NGOs don’t make more of a fuss.  Alas, it’s the same old story: their long-standing inability to decide what to think about the thorny issue of developing country participation in climate mitigation. Hamstrung by a rigid interpretation of what constitutes ‘equity’ for developing countries, none of them are willing to touch the question of quantified emission targets for poor nations. With targets out of the picture, they need some alternative storyline on how developing countries are supposed to reduce emissions and get access to clean technology – and so they end up cheerleading for the CDM, and persisting in the fiction that a few tweaks will be enough to resolve the fundamental design faults with the scheme.

So with no-one out there calling time on the CDM, Copenhagen will doubtless agree another ten years for this broken mechanism that delivers neither real emissions reductions nor real finance for development.

The tragedy here is that all the while, a far better solution to these challenges has been staring us in the face: get all countries involved in quantified targets, and deal with the equity issue by sharing them out on an equal per capita basis.  Presto: massive new source of finance for development, plus safely stabilised climate. But the longer we wait to do this, the more of a safe ‘emissions budget’ gets used up – and the less remains to be shared with developing countries when a worsening climate means it’s no longer avoidable for them to take on targets.

The CDM represents a collective unwillingness to face up to difficult issues in the hope that they’ll get easier with time.  Alas, the opposite is the case.

As UK political party leaders vie with each other in the wake of the expenses scandal to crack down on the cushy life that MPs are perceived to enjoy, Tom Harris MP learns that David Cameron’s widely-trailed plans to cut ministerial pay and eliminate subsidised food in Parliament are just the thin end of the wedge:

Cameron: “I f**king hate politicians”

Thursday, September 10th, 2009

POLITICIANS will rue the day they were born if the Conservatives get their way, David Cameron promised yesterday.

Announcing a series of reforms to be implemented by a future Tory government, Mr Cameron said that MPs were “the lowest form of life known to man” and “utter scum”.

The Tory leader said that his government would not only cut the number of MPs by “at least” 100 per cent, but would also make sure their salaries were cut radically, forcing them “to depend on their trust funds like ordinary people”. He also promised to raise the cost of food and drink in the Palace of Westminster and suggested that staff might want to spit in MPs’ tea, “just to remind them who’s boss”.

“I’m so glad I never went into politics,” Mr Cameron told a  room packed full of journalists and a scary-looking bloke in an anorak and clutching a thermos flask who said he was from the Tax-Payers’ Alliance.

Asked what qualities he hated most in politicians, Mr Cameron replied: “Cynicism and populism.”

From the Pew Global Attitudes project:

Eight years after the September 11 terrorist attacks on the World Trade Center and the Pentagon, the Pew Global Attitudes Project finds that support for Osama bin Laden has declined considerably among Muslim publics in recent years. Moreover, majorities or pluralities among eight of the nine Muslim publics surveyed this year say that suicide bombing and other forms of violence against civilians can never be justified to defend Islam; only in the Palestinian territories does a majority endorse such attacks.

The drop in support for bin Laden has been most dramatic in Indonesia, Pakistan and Jordan. Currently, about one-quarter of Muslims in Jordan (28%) and Indonesia (25%) express confidence in the al Qaeda leader to do the right thing regarding world affairs; in 2003, majorities in each country agreed (56% and 59%, respectively).

A few weeks back, George Monbiot and Paul Kingsnorth had an intriguing debate on the Guardian’s website about prospects for the imminent demise of western civilisation. Both are firmly convinced that the world is in Very Serious Trouble, what with climate change, oil depletion and what have you.  Both think we are probably All Doomed. Where they differ, though, is whether we should even try to mount a rescue attempt.

Monbiot is definitely the more upbeat of the two, in that – cheery chap that he is – he reckons that it’s on balance a good idea to avoid the total collapse of civilisation:

I’m sure we can agree that the immediate consequences of collapse would be hideous: the breakdown of the systems that keep most of us alive; mass starvation; war. These alone surely give us sufficient reason to fight on, however faint our chances appear. But even if we were somehow able to put this out of our minds, I believe that what is likely to come out on the other side will be worse than our current settlement … I am fighting to prevent both initial collapse and the repeated catastrophe that follows. However faint the hopes of engineering a soft landing – an ordered and structured downsizing of the global economy – might be, we must keep this possibility alive.

Pah, says Kingsnorth: our current economic system can’t be tamed without collapsing - ”and who wants it tamed anyway?”  – so we must grow up and let go of the idea that our predicament can be fixed (whether through clean technology, through co-ordinated interntional action, or whatever).

The challenge is not how to shore up a crumbling empire with wave machines and global summits, but to start thinking about how we are going to live through its fall, and what we can learn from its collapse.

As you might expect, all of this is deeply exciting for other collapse gurus, some of whom just can’t resist adding their own two-pennyworth. Like the Archdruid, for instance, whose blog is reliably full of (always readable) musings on our imminent demise. Rather fabulously, he dismisses both Monbiot and Kingsnorth on the basis that both of them are unduly optimistic:

Both men are proclaiming the gospel of a better future; their disagreements are simply about what form that future will take and how we will get there. Both assume that we can have, and ought to have, a future that’s even shinier than the present …

We are not going to have a future better than the present: not in our lifetimes, and not in those of our grandchildren’s grandchildren. We collectively closed the door on that possibility decades ago, and none of the rapidly narrowing range of choices still open to us now offers any way of changing that. If this sounds like fatalism, it may be worth remembering that once a car goes skidding off a mountain road into empty air, it requires neither a crystal ball nor a faith in predestination to recognize that nothing anybody can do is going to prevent a terrific crash.

One can only imagine the sort of inverse euphoria induced by spending one’s days in this kind of competitive auction of doom with other collapse gurus – perhaps this is what it’s like to take ketamine. Either way, I wish to place on record a discordant note. (more…)

It’s long been a source of frustration to me that developing countries don’t come out and demand quantified emissions targets, based on an equal per capita entitlements, since this would at a stroke (a) create the space for agreeing a global emissions budget – a prerequisite for stabilising concentrations of greenhouse gases at any defined level, and (b) set up a massive new source of finance for development, as David and I noted in our paper for DFID (pdf) on international institutions for climate change.

All the more welcome, then, to see this observation in UNCTAD’s 2009 Trade and Development report (highlights; pdf):

An international carbon market in the form of a cap-and-trade system could be a source of income for many developing countries.

If designed in a manner that takes into account the responsibility of the industrialized countries for the existing GHG concentrations in the atmosphere, on the one hand, and the need for developing countries to contribute to global climate change mitigation, on the other, such a system might go a long way towards meeting their requirements for the financing of imports of the technology and equipment necessary for GHG abatement.

For example, if population size were to be given an important weight in the initial allocation of permits across countries, many developing countries would be able to sell their emission rights because they would be allotted considerably more permits than they need to cover domestically produced emissions.

P.S. UNCTAD forgot to mention one thing: said emissions budget is currently being used up awfully fast by developed and middle income countries – which puts a rather different slant on the oft-seen spectacle of developed countries saying reassuringly that of course low income countries needn’t think about targets before 2020.

Low income countries: beware of Greeks (and other Annex 1 Parties) bearing gifts…

You’d hope that the Security Editor of a national newspaper would be able to tell the difference between doctrinaire religious views and terrorism – but not so The Times’s Sean O’Neill, it seems, who has an amusing puff piece this morning on the Queen’s Road mosque in Walthamstow (a couple of hundred yards from where your intrepid blogger lives, flack jacket close at hand):

Long before the Walthamstow mosque came under Tablighi influence, it hosted “study circles” led by Bakri Mohammed’s followers. I attended one of those meetings as a reporter in August 1989 and heard young men decry the evils of drink, discos and “free intermingling of the sexes”.

Young Muslims unsure about drink, discos and free intermingling of the sexes? Hold the front page!! Someone get MI5 on the phone!! Code red!!! What else has he found?

Afzal Akram, the local councillor whose brief includes “community cohesion”, insisted that Queen’s Road mosque itself was not part of the problem. “It’s got nothing to do with the imams or the mosque — some of my friends and family pray there, I’ve been there myself,” he said. “None of the mosques here have been used to preach extremism. Individuals may have met at particular mosques and individuals may live within a stone’s throw of the mosque. But I wouldn’t put two and two together.” Mr Akram says that extremism locally is little more than youngsters “mouthing off” and “spouting conspiracy theories”. But the Government is spending £90,000 in the borough to teach “leadership” to young Muslims.

There it is! The proof for everyone except those that refuse to see it!! Ninety thousand pounds!!! If that doesn’t prove that Waltham Forest is right at the top of the government’s watch list, what does??!? And there’s more!!

That the airline bomb plot was based in Walthamstow has shocked residents of this northeast London suburb. The area prides itself on having a mixed and well-integrated community and, unlike in many areas of East London, there are no ghettos. But the plot has revealed that Islamist extremism is deeply rooted in elements of the large Muslim population.

“Elements”? What, all three of them?

Update: the Associated Press’s David Stringer has tweeted that I’m being a little unfair, and perhaps he’s right. But there’s a serious point at play: things are a little tense at the moment what with one thing and another, and that makes this a good moment for journalists to take great care to avoid inflaming things.

In that context, it’s especially important to be clear that doctrinaire religious views and terrorism are not the same thing (remember Tony Blair falling into this trap after 7/7?). Yes, there’s a serious debate to be had about what happens when competing universalist philosophies live cheek by jowl.  But it doesn’t seem that sensible or helpful to me to link that debate to what to do about a handful of nutters that even MI5, of all people, describe as religious novices:

Far from being religious zealots, a large number of those involved in terrorism do not practise their faith regularly. Many lack religious literacy and could actually be regarded as religious novices. Very few have been brought up in strongly religious households, and there is a higher than average proportion of converts. Some are involved in drug-taking, drinking alcohol and visiting prostitutes. There is evidence that a well-established religious identity actually protects against violent radicalisation.

Getting all Melanie Phillips about things, on the other hand, mixes these two debates up, fans some people’s very deep-seated fears, and nudges us towards US-style town-hall culture wars – rather than the careful, evidence-based debate we need.

There have been many blips along the road in the nineteen months since the Bali Roadmap was launched, but with less than a hundred days to go before D-day – and less than 20 negotiating days – the last few weeks have seen a steady crescendo on all sides of the negotiating table. Over the past week alone there have been three significant developments: (i) African countries agreed a common negotiating stand at Copenhagen; (ii) Japan announced its ambitious plan to cut emissions by 25% (from 1990 levels); (iii) the scene was set for a US-China bilateral deal on climate change.

1) Africa emerges as a unified and purposeful participant in the upcoming negotiations

Last week, ten African Heads of State and assorted ministers met in Addis Ababa to agree a common stand for Africa ahead of the Copenhagen conference. This meeting also decided that Africa would be represented by one delegation, to be headed by Prime Minister Meles Zenawi of Ethiopia. I have already delved into the outcomes and significance of this meeting in my previous post.

2) The US and China to sign a bilateral deal on climate change?

A recent visit to Beijing by US Senator Maria Cantwell reportedly set the ground for a wide-ranging bilateral agreement between China and the US on climate change. This deal is to be sealed on the occasion of President Obama’s scheduled trip to China in November, a month ahead of the Copenhagen climate conference. Reuters reports that:

The United States and China are likely to sign a new bilateral agreement to combat climate change during President Barack Obama’s visit to Beijing in November, Washington senator Maria Cantwell said on Friday. Cantwell, who is in Beijing to discuss clean energy and intellectual property issues with Chinese officials, said a deal between the world’s two biggest CO2 polluters would also help build global confidence in the efforts to curb global warming.

This is extremely significant when you consider that the combined emissions of the US and China account for 40% of the global total. Such a deal could send a strong signal and boost confidence ahead of the Copenhagen Climate conference.

3) Japan announces ambitious plans to curb emissions

Japan’s PM-elect, Yukio Hatoyama, reaffirmed his party’s pledge to cut greenhouse gas emissions by a quarter by 2020 from 1990 levels, amidst strong opposition from industry. This is a highly ambitious commitment: it would require Japan – which is already leading the world in terms of its efficiency in energy use – to reduce emissions by a third from current levels in just 11 years. Mr. Taro Aso had previously only committed to reducing emissions by 8% from 1990 levels.

As the world’s second largest economy and fifth largest emitter, Japan’s move would increase pressure on other main players ahead of the upcoming Copenhagen Climate Conference.

A significant but little reported event occurred last Thursday. The Africa Partnership Forum held a Special Session on Climate Change on 3 September 2009 at the UN Economic Commission for Africa (UNECA) Headquarters in Addis Ababa, Ethiopia. The purpose of the event was to agree a common negotiating platform for Africa focused on Africa’s concerns and expectations in the run up to the Copenhagen Climate Change to be held in December 2009.

The meeting was attended by ten African Heads of State and assorted ministers, regional institutions such as UNECA, the New Economic Partnership for African Development (NEPAD) and the African Union. The Joint Statement is worth reading. It will be transmitted to the UN High Level event on 22 September, the G20 Summit at Pittsburgh and other processes.

This meeting laid out the key elements of Africa’s negotiating positions at Copenhagen. They are as follows:

(more…)

Former White House chief of staff John Podesta (now at the Center for American Progress) is far from happy about the ejection from the White House of Van Jones, Obama’s adviser on clean energy.  He had this to say about Jones’s persecutors:

Clearly, Van was the subject of a right-wing smear campaign shrouded in hypocrisy. Van’s chief tormentor Glenn Beck, who spent weeks engaged in vicious name-calling, retains his perch at Fox News after calling the president a racist who has “a deep-seated hatred for white people.” Van has set a standard that Beck would never impose upon himself.

Over on Glenn Beck’s twitter feed, the next targets are already being lined up:

Watch Dogs: FIND EVERYTHING YOU CAN ON CASS SUNSTEIN, MARK LLOYD AND CAROL BROWNER. Do not link before burning to disc. 7:48 AM Sep 4th from web

Carol Browner’s the Assistant to the President for Energy and Climate Change; Cass Sunstein’s the author of Nudge and head of the White House Office of Information and Regulatory Affairs (and also Samantha Power’s husband); and Mark Lloyd’s the Associate General Counsel and Chief Diversity Officer at the Federal Communications Commission.

Just watched a rather depressing Dispatches programme about post-traumatic stress disorder in UK troops – guys coming home and expecting to be attacked at any moment. One guy slept with a machete next to his bed and could still only get to sleep after drinking a bottle of vodka. Apparently the UK military will only give PTSD counselling if the soldiers ask for it. And none of them ask for it.

Meanwhile, the US military has just launched something called the Comprehensive Soldier Fitness programme, which has been developed by Penn University’s psychology department. Every two years, each US soldier will take some questionnaire to test their aptitudes in five areas: physical, emotional, social, family and spiritual. If they are not doing well in a particular area, they’re encouraged to take courses to up their score in that area (I don’t know what this involves…’your homework today: go out and find God’).

Anyway, supposedly it teaches the soldiers resilience, making them less likely to develop PTSD in the first place. As Brigadier General Rhonda Cornum (one tough old soldier, who was captured and abused during the first Iraq War, and said her abuse was “discomforting, nothing more”) puts it:

“It was developed because we recognized that we really did not have a good preventive and strengthening model for psychological health. It’s just a recognition that we spend an enormous amount of energy and resources on people after they’ve had some negative outcome, but we’re not doing anything deliberately as a preventive measure.”

This means more kudos for Martin Seligman of Penn Uni, who invented the resilience training programme and has already persuaded the UK government to try it in our state schools (hey if it can work there, it can work in Afghanistan). He was the pioneer of the idea of ‘learned optimism’, having previously pioneered the idea of ‘learned helplessness’, when he showed that if you electrocute a dog for long enough, they will be unhappy.

The US military liked that idea too – they used it to develop interrogation techniques at Guantanamo Bay, much to Seligman’s annoyance.

Anyway, I’m all for this Comprehesive Soldier Fitness course, but I bet you one thing – nowhere in the course do they mention Stoicism. And that’s what it is – it’s teaching you to change your perspective on things, to get a ‘philosophical angle’ on traumatic events. Seligman took his ideas from another Penn psychologist, Aaron Beck, who took them directly from Stoicism – as he’s said to me in an interview.

But then, I guess if you admitted your ideas were directly lifted from a 2,000-year-old philosophy, you wouldn’t get such a fat cheque from the Pentagon…

Over at Slugger O Toole, I have an essay in a series on the Irish Lisbon referendum. My conclusion: we need a ‘yes’ vote so that the EU can begin the process of turning itself into a platform for managing global risks. There’ll be further contributions every day between now and the vote next month. (more…)

I take it all back. Within moments of publishing the post below about the naked protestors at Edelman, not one but two Edelman employees were in touch via Twitter, pointing me to a blog post by their CEO. Full marks for new media nimbleness. So what do they actually say?  Well, their main point is that

As with last time, we offered the protestors the chance to sit down (preferably, fully clothed) and engage in a constructive dialogue with us. We are happy to hear their concerns and discuss their issues. Sadly, they seem more intent on going for the headline, picture story and the sound-bite, rather than for a constructive and engaged conversation.

Now of course, it’s an entirely sensible comms strategy for Edelman to let everyone know that they tried to have a dialogue, but were snubbed by the protestors.  It positions them as the magnanimous, reasonable, centrist party, while the protestors are made to appear rather fringe by comparison.  The point is reinforced in the post’s last paragraph, which talks of the need for ”engaged dialogue among multiple stakeholders, including the NGO community”, while accusing the protestors of “cheap stunts”.

But wanting to be seen to be open to dialogue isn’t the same as being open to dialogue.

The protestors would doubtless reply to Edelman’s entreaties by pointing out that Edelman work with E.On – the power company that owns Kingsnorth – not (as their CEO’s blog post implies) because Edelman is impressed with E.On’s arguments that “in order to reduce our carbon emissions, keep energy affordable and keep the lights on, we need a balanced energy policy that includes renewables, nuclear and cleaner fossil fuels”, but instead for the rather more earthy reason that E.On pay them a healthy monthly retainer.

Now, I’m willing to give Edelman the benefit of the doubt here (they are after all involved in the admirable Citizen Renaissance project), but presumably not everyone will be so generous.  So how can Edelman win over the sceptics?

Quite easily, actually.  For Edelman to prove beyond dispute that they are themselves genuinely open to “engaged dialogue” –  in their own right, rather than just as a mouthpiece for E.On – all they need do, surely, is point to an example of an area in which they have a substantive disagreement on climate policy with E.On.

Perhaps in the comments section below?

Public relations firm Edelman is very proud of its crisis management practice.  As its website says:

Companies must address parallel challenges which must be addressed head on: the actual issues or crisis situation and the potential reputational fall-out of not being perceived to handle the related problems in a timely and effective manner. Edelman’s specialist Crisis and Issues Management & Communications team is organised and equipped to ensure that both angles are covered through an integrated management and communications approach which anticipates and addresses both underlying risks and surface realities.

All the more amusing, then, that the News section of Edelman’s website makes no mention of the fact that a number of naked demonstrators from the Climate Camp are currently occupying their London office in protest at their PR campaign for a new coal power station at Kingsnorth…

Update: Edelman have been in touch to reply to this post