Weekend reading recommendations, watching the world change

Four different perspectives on the world, hopefully ones you have not seen lately!

1. “The Myth of the Oil Crisis” by Robin M. Mills (2008) — Website for the book. 
2. “‘Soviet’ Britain swells amid the recession“, Abul Taher, The Times, 25 January 2009
3. The Feeding of the Nine Billion: Global Food Security for the 21st Century“, Alex Evans, Chatham House Report, January 2009
4. “The Big Banks vs. America“, Roundtable with David Kotok and Josh Rosner, The Institutional Risk Analyst, 26 January 2009

Excerpts

1.  “The Myth of the Oil Crisis” by Robin M. Mills (2008) — Website for the book.  Excerpt:

Are we on the cusp of a new oil crisis? After many false alarms, is the wolf finally here? Record oil prices and fast-growing Asian demand seem to indicate a gloomy energy future. Now a new book challenges the predictions of doom.

1. We have enough oil and gas to meet growing demand for decades to come.
2. International co-operation can secure energy supplies without military conflict.
3. Hydrocarbons can be used as part of a sustainable future, without destroying the global environment and climate.

A vital resource for those who want a rational, clear-headed look at our energy future-myths and reality, problems and solutions.

Also by Mills:  “The Dangerous Myth of Energy Independence“, posted at Informed Comment, 2 September 2008

Also see a review of this book by Ari, posted at Peak Oil Debunked, 24 January 2009.

2.  “‘Soviet’ Britain swells amid the recession“, Abul Taher, The Times, 25 January 2009 — Excerpt:

PARTS of the United Kingdom have become so heavily dependent on government spending that the private sector is generating less than a third of the regional economy, a new analysis has found. The study of “Soviet Britain” has found the government’s share of output and expenditure has now surged to more than 60% in some areas of England and over 70% elsewhere.

Experts believe the recession will tighten the state’s grip still further as benefit handouts soar and Labour directs public sector organisations to create jobs to soak up unemployment.

In the northeast of England the state is expected to be responsible for 66.4% of the economy this year, up from 58.7% when a similar study was carried out four years ago. When Labour came to power, the figure was 53.8%.

Across the whole of the UK, 49% of the economy will consist of state spending, while in Wales, the figure will be 71.6% – up from 59% in 2004-5. Nowhere in mainland Britain, however, comes close to Northern Ireland, where the state is responsible for 77.6% of spending, despite the supposed resurgence of the economy after the end of the Troubles.

… The state now looms far larger in many parts of Britain than it did in former Soviet satellite states such as Hungary and Slovakia as they emerged from communism in the 1990s, when state spending accounted for about 60% of their economies.

Latest figures from the Office for National Statistics show that since Labour came into power in 1997 jobs in the public sector have swelled by more than 500,000. In 1997, more than 5.1m people were employed in the public sector. The figure for 2008 is 5.7m.

… “In the long term we need to do something about it. This does suggest the crowding-out phenomenon of the private sector and it also suggests there is a lack of entrepreneurial activity.”

3.  “The Feeding of the Nine Billion: Global Food Security for the 21st Century“, Alex Evans, Chatham House Report, January 2009 — Description:

Between mid-2007 and mid-2008, the issue of rising global food prices moved to the very forefront of the international political agenda. Tens of millions more people were pushed into hunger and poverty as a result; civil unrest flared up in locations all over the world; over thirty countries introduced export restrictions on food, even as many importing countries attempted to tackle the issue through subsidies and price controls.

This report – a longer follow-up to an April 2008 Chatham House Briefing Paper entitled Rising Food Prices: Drivers and Implications for Development – sets out to look beyond the immediate causes and impacts of the global food price crisis of recent months, towards the medium and longer term.

4.  “The Big Banks vs. America“, Roundtable with David Kotok and Josh Rosner, The Institutional Risk Analyst, 26 January 2009 — Excerpt (emphasis added):

Rosner: Yes and this is why I wanted to have this conversation. I am hearing very clearly from within the regulatory community that it is their primary concern that whatever they are planning is predicated on the notion that we must keep the large banks alive. But if we start off with saving the big banks as the point of departure, then there is no way we can marry that to an efficient or effective proposal. Lets define the solution based first on what is workable not by tying a hand behind our back with preconceptions.

Kotok: I am hearing the same thing. The motivation of keeping big banks alive is driven by a desire to avoid another Lehman on the Obama watch. I hear people saying that we cannot have another Lehman, therefore we cannot permit a failure.

The IRA: And by that we mean a good old fashioned failure of a publicly listed parent holding company a la Lehman or Washington Mutual, where the equity was entirely wiped out and the unsecured debt holders got pennies on the dollar?

Kotok: Yes, precisely. Hence, whatever it takes we must avoid it. It is the Lehman failure and the contagion that is driving this policy.

The IRA: Well this just confirms that nobody in Washington understand the problem. As we have heard from many people in the industry who did the diligence on Lehman, there was no way for a private buyer to do the deal, so bankruptcy was the only choice w/o a very large, several hundred billion public bailout. The fact that the Fed and Treasury professional staff support this type of idiocy, over time, will destabilize the political consensus in this country behind an independent central bank. We might as well just make the Fed part of Treasury now.

…

The IRA: Nobody in the Congress or the White House wants to acknowledge that the policy prescriptions coming from the Fed and Treasury are badly flawed when it comes to bank solvency. The market liquidity measures have had success, but the “save the big banks” approach by the Fed is just more of the same nonsense that cause the problem in the first place.

…

The IRA: What is the view on Geithner? Looks like a confirmation?

Rosner: Yes, the conservative Republicans refuse to skewer this guy because they are afraid that there is a socialist in the wings.

The IRA: You mean Larry Summers? How could an avowed socialist be any worse than the statist policies followed by Geithner, Paulson and Bernanke today?

Afterword

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To read other articles about these things, see the FM reference page on the right side menu bar.  Of esp interest these days:

• About Food – articles about this global crisis
• About Peak Oil and Energy – my articles
• About Peak oil and energy – studies and reports
• About Financial crisis – what’s happening? how will this end?