October 10, 2005

Anticipated Light Blogging Alert

Filed under: General — Tom @ 3:09 pm

Thanks to travel and a great deal of speaking business over the next three days, my ability to blog and moderate comments, and also to react to comments, will be limited. I anticipate one or two posts beyond the daily Positivity entries, which are already set up for scheduled posting (so much for my fears that finding Positivity entries would be difficult).

I’ve prepared an additional couple of entries in advance on what I consider to be pretty important topics, so even if my time is totally monopolized, which is somewhat likely, the activity here won’t disappear.

Kudlow Says the Fed Should End the Rate Hikes

Filed under: Economy,Taxes & Government — Tom @ 2:30 pm

He has pretty decent reasons:

In fact, over the past 12 months the Fed’s preferred core consumer spending deflator has increased only 2%, actually lower than its 2.3% rate last November, which is 10 months ago. Their range is 1.5 to 2.5%, so they have done a good job. And it’s possible core prices are heading back down after 15 months of tightening.

While the rise in gold prices is troubling, the yield curve has flattened, the dollar is strengthening, bond rates are historically low, and the T-bill is well below the Fed funds rate.

So the weight to the forward-looking inflation evidence, as well as the core consumer deflator, suggests that the central bank has done enough and should take a well-earned vacation from future tightening moves.

I’d be satisfied with “one-and-done.” Don Luskin, as noted earlier, not only doesn’t agree but thinks there will be three more hikes between now and January 31, 2006.

OpinionJournal.com’s “Peak Oil” Rebuttal

In an unsigned, read-the-whole-thing piece, OpinionJournal.com is on a roll (may require registration; bolds are mine throughout) as it shreds the “Peak Oil” (“we’re running out of oil and life as we know it will never be the same”) arguments:

The limits-to-growth crowd has predicted the end of oil since the days when this black gold was first discovered as an energy source in the mid-19th century. In the 1860s the U.S. Geological Survey forecast that there was “little or no chance” that oil would be found in Texas or California. In 1914 the Interior Department forecast that there was only a 10-year supply of oil left; in 1939 it calculated there was only a 13-year supply left, and in 1951 Interior warned that by the mid-1960s the oil wells would certainly run dry. In the 1970s, Jimmy Carter somberly told the nation that “we could use up all of the proven reserves of oil in the entire world by the end of the next decade.”

We can ridicule these doom-and-gloom predictions today, but at the time they were taken seriously by scholars and politicians, just as the energy alarmists are gaining intellectual traction today. But as the late economist Julian Simon taught, by any meaningful measure oil (and all natural resources) has gotten steadily cheaper and far more bountiful in supply over time, despite periodic and even wild fluctuations in the market.

But won’t oil prices keep going up to the point of unaffordability?

If gasoline cost today what it cost a family in 1900 (relative to income), we would be paying not $3 but $10 a gallon at the pump. Or consider that in 1860 oil sold for $4 a barrel, or the equivalent of about $400 a barrel in today’s wage-adjusted prices. The first of a continuous series of innovations, in this case the invention of modern drilling techniques in 1869, cut the price by more than 90%–to 35 cents a barrel.

Fifty years ago people would have laughed out loud at the idea of drilling for oil at the bottom of the ocean or getting fuel from sand, both of which were technologically infeasible. The first deep-sea oil rig went on line in 1965 and drilled 500 feet down. Now these rigs drill two miles into the ground–and miraculously, the price of extracting oil from 10,000 feet deep in the sea bed today is approaching the cost of drilling 100 feet down from the richest fields in Texas or Saudi Arabia 40 years ago.

This spectacular pace of technological progress explains why over time the amount of recoverable reserves of oil has increased, not fallen. Between 1980 and 2002 the amount of known global oil reserves increased by 300 billion barrels, according to a survey by British Petroleum. Rather than the oil fields running dry, just the opposite has been happening.

Here’s a great rebuttal to the “this time it’s different” crowd:

In this industry, alas, bad news tends to crowd out the good. When Shell announced earlier this year that its oil and gas reserves were down by 30%, there was a global outcry. But when Canada announced in 2004 that it has more recoverable oil from tar sands than there is oil in Saudi Arabia, the world yawned. There is estimated to be about as much oil recoverable from the shale rocks in Colorado and other western states as in all the oil fields of OPEC nations. Yes, the cost of getting that oil is still prohibitively expensive, but the combination of today’s high fuel prices and improved extraction techniques means that the break-even point for exploiting it is getting ever closer.

The energy Malthusians counter that China, India and other nations will satisfy their growing appetite for oil by driving demand and prices ever higher. In the short term, yes. But over the longer term, as the Chinese become more prosperous through free markets, China will become vastly more fuel efficient and also help discover new sources of energy.

Finally, if there is to be a problem with oil, we know who to point the finger at:

Our point is that the constraints on our ability to find and extract new oil are not geologic or scientific. The real constraints on oil production are barriers created by government. Myron Ebell, an environmental analyst at the Competitive Enterprise Institute, notes that roughly 90% of the oil on the planet rests under government-owned land and these resources are abysmally managed.

In the U.S., environmentalists have erected myriad barriers to drilling for new sources of oil. The American Petroleum Institute estimates that there are at least 100 billion barrels that are fairly easily recoverable in Alaska and offshore that oil companies are not permitted to exploit. Once, we could afford the luxury of not drilling there. Now, thanks to a witch’s brew of unforeseen circumstances–political turmoil in the oil producing countries, China’s surge in demand, and hurricanes that have knocked out Gulf refineries–it’s an economic and national security imperative that we do.


UPDATE: Porkopolis has more, including links to heavyweights like Peter Huber and others. He has been on the energy case for some time.

BizzyBlog Flashback:
- August 26: I’m Tired of the Oil-Price and Oil-Supply Obsessions

Positivity: Mariners Build Shelters for New Orleans Pets

Filed under: Positivity — Tom @ 6:05 am

Those of you who feel there is sometimes not enough deference to our four-legged friends should like this item from The Navy Newsstand:


Is the BBC Censoring Itself to Keep in China’s Good Graces? (See UPDATES 2A and 4 and Linked Future Post–Evidence Shows They Are Not)

NOTE: Go to Updates 2A and 4 below, and to this corrections post for the full nature and extent of corrections to the original post, which begins below.

Original Post

The southern Chinese city of Taishi has been the site of major rural uprisings in China recently.

RConversation links to a chilling UK Guardian account of the murder of a Chinese activist and beatings of journalists, and also cites other sources.

It is becoming very obvious that the Chinese government wants the rest of the world to know as little about Taishi uprising as possible.

In the course of studying this, I wanted to see where Taishi is on a Chinese map. Well, I haven’t done that yet because I saw this BBC link in a Google search on “taishi china map” (4th listing when I did the search), and wanted to read more:


So I went to the indicated BBC link and found the following:


Something becomes painfully obvious when comparing the Google entry and the current BBC article: The sentence that appears in the Google entry — “A villager walks past a row of riot police in Taishi, southern China” — was the description below the picture before it was changed to the non-descriptive one you see above (“A number of protests have erupted over government corruption.”).

How do I know? The word “Taishi” currently does not appear anywhere on the page, so the web page as it currently exists could not have generated the Google entry above.

It seems very unlikely to me that the change described would have been made in the ordinary course of editing without some kind of other influence coming into play.

So, I must ask: Is the BBC censoring its coverage to keep in China’s good graces? In this particular instance, did the Chinese government “suggest” that the BBC remove references to Taishi? Or did higher-ups at the BBC modify the description to head off a potential dispute with the government?

I still haven’t found where Taishi is on a Chinese map, but I am learning more than I wanted to know about where journalists are when it comes to shading stories to stay on the good side of tyrants.

It’s not like this kind of thing has never happened before:

  • In 2003, shortly after US troops took control of Baghdad, CNN’s now-deposed Eason Jordan, in a New York Times op-ed column, admitted, as the linked piece indicates, that “knowledge of murder, torture, and planned assassinations were suppressed in order to maintain CNN’s Baghdad bureau.”
  • The BBC, as Weapons of Mass Discussion noted and updated at the time, removed the word “terrorist” from its original reportage on the July London Subway bombings that contained the word. Perhaps World Affairs Editor John Simpson, referred to at the WMD update post, is up to his old tricks.

Apparently they have not learned, and perhaps never will, that accuracy and integrity are more important than access.

Shame on the BBC.

UPDATE: From Radio Free Asia–”Chinese Authorities Arrest Rights Lawyer in ‘Test-Case’ Taishi Village” (excerpt is about halfway through the article), one can see why the Chinese government would prefer that “Taishi” not be mentioned:

The Taishi standoff, widely seen by Chinese scholars and the legal profession as a test of local governments’ commitment to village democracy and rule of law, began in July after a 100 million yuan (U.S. $12 million) land deal involving more than 2,000 mu (133 hectares) of village land.

Villagers and their lawyers said accounting procedures around the sale were not transparent, and they suspected Chen of embezzling public funds.

In clashes earlier this month, riot police ended a hunger strike and fired water cannon on protesters, many of them elderly, prompting widespread outrage among ordinary Chinese with access to news reports of the incident.

Alleged ‘white terror’

Last month, villagers fought against government attempts to stack the re-election committee in its favor, electing seven of their own candidates ahead of a key vote slated for Oct. 7 on whether village chief Chen Jinling should remain in office.

However, attempts by officials to scupper the campaign appear to have succeeded, with Friday’s vote reportedly cancelled and with all seven of the victorious candidates now having tendered their resignation.

Villagers reported a “white terror” campaign by township and district officials, who used personal and family ties, threats, banquets and a door-to-door signature campaign to derail support for Chen’s recall.

They said many villagers were persuaded to abandon their campaign in return for the release of detained fellow protesters, many of whom were in their seventies and eighties.

Read the whole thing.

UPDATE 2: This BBC link covers what the Guardian got to first about the beating of Lu Banglie. But… The Guardian reporter says Lu Banglie is dead, while the Beeb says he’s “missing.” Read the UK Guardian article yourself and see if you think there is any chance Lu is still alive. UPDATE 2A, October 11: Well, this is certainly humiliating: I am happy to report that Lu Banglie is still alive, and regret to report that my reliance on the UK Guardian as a sole source about anything is dead. A BBC person tells me that “I hope you will agree we were right to be cautious about the first reports.” Uh, yeah.

UPDATE 3: Commenter #3 points to other stories where Taishi is mentioned in captioned pictures, and I appreciate the links. In light of this, I changed the title of this post to a question, because I believe the matters is still open to debate. As I pointed out at comment 4, I still don’t understand why the captioned description at the BBC link discussed in the post was changed AFTER the initial publication of the article, as clearly occurred.

UPDATE 4, October 11: Even though the question at UPDATE 3 stands, based on UPDATE 2A (Lu is still alive, though the Guardian wrote him off as dead) and that fact that the Beeb has mentioned Taishi in other reports, I believe that the Beeb ought to be given the benefit of the doubt.