The Quiet Road

Last night the British parliament enacted a thoroughly regressive piece of legislation. Called The Digital Economy Bill (DEBill), it is ostensibly designed to — amongst other things — prevent internet file-sharing. In fact, what it actually does is allow large corporations to legally victimise individuals based on nothing more than suspicion. Once again the representatives of the people have sold them out to appease the power of private capital.

And people say the coming election actually matters? Fact is, who ever gets into government, it’s Big Business who stays in power.

According to DEBill, corporations are permitted to monitor the nation’s internet connections and demand that anyone suspected of filesharing be disconnected. Yes, warning letters must be sent out first, but the fact remains that there is no actual burden of proof involved. If your IP address is spoofed, or WiFi network hacked, or computer compromised by a custom trojan*, say goodbye to your net connection. If your 14 year old kid continues to download music without your knowledge, say goodbye to your net connection. If you share your own home movies or music with others and can’t prove that it’s your material (in this case there is a burden of proof… but it’s on you; you must take the issue to court at your own cost), say goodbye to your net connection.

And this has happened in a climate where the Minister for Digital Britain, Stephen Timms, claims that “[b]roadband is no longer considered a luxury — it has become an essential service delivering social, commercial and economic benefits”. A climate where Gordon Brown insists that “the internet is as vital as water and gas” (hyperbole certainly, but he said it, not the anti-DEBill camp).

So Britain now has a Labour-driven law designed to allow corporations to legally withdraw essential services from individuals on the basis of suspicion of wrongdoing.

But of course it wasn’t just Labour who passed the law. It pretty much had all-party support. The tories were firmly behind it. And while the Liberal Democrats claimed to oppose it, they couldn’t be bothered to show up for the vote, let alone the debate. This is supposed to be the liberal party, the one that in theory would be most opposed to this kind of corporate power grab, and yet less than a third of their MPs were present in parliament to speak or vote against it. While Nick Clegg and his liberal democrats jet around Britain talking like they’re an alternative to the two large parties, their actions tell a somewhat different story.

Politicians are constantly lamenting the perceived public apathy with politics. Young people, they say, are disconnected from the political process. But here we have a bill that’s arguably of particular interest to young people and yet anyone tuning in to watch the proceedings last night would have seen a handful of disinterested and ill-informed MPs in a half-empty room acquiescing to the wishes of big business. If even the professional politicians can’t be arsed to attend a vote on important legislation, is it any wonder nobody else is interested in the bloody process?

UPDATE: It appears that the office of Stephen Timms, Minister for Digital Britain, is under the impression that IP (as in IP address) stands for “Intellectual Property”. I just don’t know what to say about that. Am I the only one who believes that perhaps MPs should actually understand the laws they are passing? That part of their job should be to research things before they legislate on them? Rather than merely being rubber-stamps to the whims of capital? Perhaps that’s why so few MPs showed up to vote… they were too ignorant to grasp the importance of the bill and too damn lazy to do anything about that fact. (via antonvowl on twitter)

Meanwhile, as Gordon Brown represented his nation by prostrating himself before the throne of Her Majesty, David Cameron was on the other side of the Thames prostrating himself before the altar of public opinion. He rolled up his sleeves and ran his fingers through immaculately styled hair to symbolise his dynamism and vigour. Unencumbered by other members of his party (almost none of whom can be trusted in front of a microphone) he desperately sought to portray himself in a presidential manner.

He echoed John F. Kennedy’s “ask not what your country can do for you” speech (though his phrasing was far clumsier and ended up being about as inspiring as a wet Sunday afternoon in Basingstoke). His promise to champion “the Great Ignored” called to mind Nixon’s appeal to the Silent Majority. In fairness to Cameron he did have almost as much charisma as Nixon. His body language and “look at how at ease I am” mannerisms screamed Bill Clinton. Though in a supremely irritating, nails-across-a-blackboard kind of way. I’d only have been mildly surprised if he’d pulled out a saxophone and donned a pair of shades.

Most of all though, he was aiming for that Barack Obama vibe. He never actually said “Yes We Can!” but you could see how much he wanted to. It was all about Change. Vote for Cameron and he’d usher in an era of change. It’s a time for change. Indeed, it’s the Year Of Change. So everyone in Britain should Vote For Change. Change and Hope. Oh, and Optimism. Change, Hope and Optimism. That’s what President Cameron would represent.

Unfortunately though, a vote for President Cameron would actually result in the election of Prime Minister Cameron. And if you thought the shower of fools and villains flanking Gordon Brown on Downing Street were depressing, just wait ’til you see who Cameron will be taking into power with him. Tawdry backward-looking reactionaries who actually mean it when they sing God Save The Queen. Bankers, puppy-killers, nuclear weapons enthusiasts… and that’s just Oliver Letwin.

Still, at least the moats will be clean.

And as Daveybloke Cameron was filmed in front of a carefully selected crowd of young, ethnically diverse supporters on the South Bank he spoke passionately about the sort of people he would represent. The sort of people his government would really listen to. “The Great Ignored” he called them. They were black and white, he said. They were rich and poor, he said (though I found it difficult to swallow the idea that “the rich” are really part of The Great Ignored). They were hard-working taxpayers, he said.

In the background you could see a short scuffle as Conservative security guards wrestled a megaphone from shadow home secretary Chris Grayling who was shouting “not the queers though, Dave, not the fucking queers!”

Indeed, if anything illustrates just how shallow this tory ‘change’ really is, it’s the ugly homophobia that seeps from under the pretty plastic facade that Saatchi & Saatchi are fashioning around the party. The past couple of weeks have seen Cameron spectacularly implode during an interview with Gay Times. An interview in which he first claimed that homosexual equality was “a fundamental human right” and then suggested that he was unwilling to put pressure on other tories to support it. The next leader of Britain, it seems, is pretty damn equivocal on the subject of fundamental human rights.

Gay Rights campaigners predictably criticised Cameron for his less than forthright support of their fundamental human rights. At the same time, Conservative elder statesman Lord Norman Tebbit was also attacking Cameron for this wishy-washy attitude to gay rights. Except he was under the impression that Cameron’s lip-service to equality was actually going too far. All a bit limp-wristed and pink for Grand-Vizier Tebbit’s liking, it seems. Daveybloke shouldn’t be concerning himself with such “trivialities” as “political asylum for African homosexuals” says Vice-Emperor Tebbit. Protecting fundamental human rights shouldn’t be a high priority for the British Conservative Party. At least, not according to the British Conservative Party.

Then, to top it all off, out comes Chris Grayling — shadow Home Secretary let’s not forget — with his suggestion that people who run Bed & Breakfasts should have the right to refuse entry to guests on the grounds of their sexuality.

That the people of Britain look likely to elect these bigots as their next government is very sad indeed.

Queen Elizabeth II.
Kindly permitting democracy in Britain.

The sorry spectacle of an elected leader travelling to the palace of an hereditary monarch to request permission to hold an election played out in the UK this morning, as it has done prior to every British election in living memory. The people of the United Kingdom (the clue’s in the name) doffed their collective cap to Queen Elizabeth in recognition of the ruthless ability possessed by her ancestors to violently subjugate the masses. Well done Liz! And well done people of Britain, for permitting such a weird and demeaning custom to continue for the amusement of the rest of the world.

And yes, we all know the queen’s role is technically ceremonial but the symbolism of the prime minister’s visit to Buckingham Palace is surely distasteful — at the very least — to anyone with a commitment to social justice and equality. Brown’s announcement on Downing Street, flanked as he was by his profoundly unlikeable and discredited cabinet that “the queen has kindly agreed” to allow the democratic process to get underway merely underlined the cringeworthy absurdity of the charade.

The thing it called most to my own mind was the explicit promises by the current government (promises that have been echoing in their speeches and manifestos since 1997) to remove hereditary peers from the House of Lords. This assembly possesses plenty of real, non-ceremonial power and influence, yet there are still over 90 members of the legislature whose position is predicated on who their dad was.

And this is a nation that feels comfortable exporting democracy at the barrel of a gun?

John Band has a good analysis of the current British Airways strikes over at his place. It’s well worth a read.

He opens the piece by pointing out that BA’s “business model is unsustainable”. This is true in the sense that he describes it. But it’s also true in another sense; one that’s shared by the airline industry as a whole. Some within the industry have begun to belatedly wake up to this fact. A month or so ago, Richard Branson (of Virgin Airlines fame) had this to say…

Of course, anyone who has been aware of the peak oil problem for longer than ten minutes will find themselves shaking their head in dismay at Branson’s statement. His belief that five years represents enough time to prepare for “the oil crunch” is roundly contradicted by every serious analysis of the problem that’s been carried out to date. Most famously (and arguably most authoritatively) the Hirsch Report, carried out by the US Department of Energy, has this to say about the length of time required to prepare for, and mitigate, the effects of peak oil.

Mitigation Efforts Will Require Substantial Time

Mitigation will require an intense effort over decades. This inescapable conclusion is based on the time required to replace vast numbers of liquid fuel consuming vehicles and the time required to build a substantial number of substitute fuel production facilities. Our scenarios analysis shows:

• Waiting until world oil production peaks before taking crash program action would leave the world with a significant liquid fuel deficit for more than two decades.
• Initiating a mitigation crash program 10 years before world oil peaking helps considerably but still leaves a liquid fuels shortfall roughly a decade after the time that oil would have peaked.
• Initiating a mitigation crash program 20 years before peaking appears to offer the possibility of avoiding a world liquid fuels shortfall for the forecast period.

Peaking of World Oil Production: Impacts, Mitigation and Risk Management (PDF, Page 65)

Even taking this into account, there’s a very real possibility that — with regards to the modern airline industry — the problems presented by peak oil simply cannot be mitigated. Even if we had two decades, which appears not to be the case, there’s just no alternative fuel for modern commercial aircraft.

Let me stress that nobody sane is suggesting that oil or jet fuel will disappear overnight. Peak oil will result in a gradual reduction in crude oil production capacity of between 3% and 6% per annum. This will, however, be more than enough to cause massive economic upheaval of the kind that will certainly overshadow our current credit crisis*. More specifically, it’ll be enough to put an end to mass air travel in anything like the form we presently enjoy.

Put bluntly, British Airways is part of a dying industry. Flying millions of people around the world in jet aircraft is unsustainable in the short to medium term and while some form of commercial air travel will surely remain available to the extremely wealthy, the industry will soon be a tiny fraction of its current size.

I like to imagine a future — say a hundred years from now — where we have successfully weathered the twin storms of resource depletion and Climate Change. Where we have achieved, almost certainly through terrible suffering and struggle, some kind of balance with our environment. Where we have adopted an ethos and a lifestyle that allow us to look towards a sustainable future. And in this future, I imagine our great grandchildren flying across oceans in magnificent solar-powered airships.

But that’s science-fiction. A speculative future that becomes less and less likely every day we persist in ignoring the need for it.

Peak oil used to be the preoccupation of a small minority, but a parliamentary group has been set up to follow the issue and an increasing number of industrialists have begun to worry about it.

The Guardian | Energy minister will hold summit to calm rising fears over peak oil

Seems to me that peak oil is still the preoccupation of a small minority. Parliamentary groups and warnings from Richard Branson notwithstanding. I’ve been banging on about peak oil for the best part of 15 years, for instance, and while it’s true that more people are now aware of the issue than was the case when I first encountered it, the number who believe it’s serious enough to warrant effective action remains negligible.

I’ve no doubt, for instance, were there a magic wand which could “solve the problem” of peak oil with no economic or social impact, those in power would be queuing to wave it. Unfortunately, so long as any solution requires accepting significant consequences for how we run things, the problem will be ignored. Eventually of course, it won’t be ignored any longer and it’ll be too late to solve… the consequences of peak oil will play out destructively, and those of us in a position to say “I told you so” will find no satisfaction in doing so.

Lord Hunt, the British Minister for Energy is starting to take note of the peak oil problem. See… it’s no longer activists and academics raising concerns, it’s industrialists. This is a far more important constituency to the modern politician, and one that warrants “private and behind-doors talks at the Energy Institute”. When a bunch of fuddy-duddy intellectuals and long-haired activists demand the attention of an elected minister, they are obviously being quite naive. When it’s “executives from Virgin, Arup, Stagecoach, Scottish and Southern Energy, and Solar Century as well as other industrialists” though? Well, then the doors of the Energy Institute get flung open and “Hunt and a range of energy-policy civil servants” attend to the concerns of those they represent.

Bizarrely, the Energy Minister is still — 15 years after it’s been completely discredited — trying to calm fears with references to the BP Statistical Review of Energy.

I know I’ve covered this before, but I’d like to revisit it. Try to clear it up once and for all. That way we can move past the “BP mirage” (for that’s what it is; a mirage) and start dealing with peak oil in a reality-based fashion.

Each year BP collate global energy numbers into the BP Statistical Review of World Energy. On the surface, it’s an impressively comprehensive document that covers energy production, consumption and reserves in all sectors. Unfortunately, on the subject of oil reserves at least (I’ve not spent much time researching the validity of what it has to say about nuclear, coal or any other energy resource), it’s fundamentally flawed. Broken beyond all recognition. Worse than useless. So anyone who uses BP’s numbers on oil — other than as a cautionary example — is making a terrible error.

Someone in Lord Hunt’s position should bloody well be aware of that.

For those who seek evidence of the inaccuracy of BP’s Statistical Review (with regards to oil reserves), I suggest downloading the “Historical Data” stats (1.6MB MS-Excel Workbook). On the ‘contents’ page click “Oil: Proved reserves – barrels (from 1980)” and examine the numbers carefully. It won’t take you long to discover some extremely odd things. But to save you some time, let me point you towards a couple of oddities which highlight the two primary reasons why the data is worthless. It’s not often a data-set is quite so self-evidently worthless.

The first thing to check is the reported reserves for the United Arab Emirates (UAE). Back in 1980, the UAE is listed as possessing 30.4 billion barrels of proven crude oil reserves. This meant they had the sixth largest reserves of oil on the planet. For the next five years this number didn’t change much. It fluctuated around the 32 billion barrel mark and in 1985 stood at 33 billion barrels. All of which, it can be argued, is fair enough. It suggests that the oil industry in the UAE was working hard to ensure that — each year — they were discovering slightly more than they produced.

Then, however, something remarkable happened. According to BP, in 1986 the UAE had proven reserves of 97.2 billion barrels. This is close to a threefold increase in a single year. Vitally, and I cannot stress this enough, the increase was not a result of a monster new field being discovered. Rather, it was a result of OPEC’s decision to change their quota system. In the mid-1980s OPEC decided that member states would have their production quotas set based upon proven reserves. The more oil you had, the more you were allowed to produce and sell.

Which reveals a rather surprising fact about the BP Statistical Energy Review… it is not compiled by BP surveyors and petroleum geologists. It is merely the collation of information submitted by national agencies. So, next year should the UAE claim to have once again trebled their reserves overnight despite little or no new discoveries, BP will calmly tell us that we now have 50 years until supply constraints.

I don’t suggest BP is in the wrong for producing these numbers. They are merely collating the claims being made by national governments (and they don’t hide this fact) However, anyone… Lord Hunt, I’m looking at you… who paints these numbers as something other than political and economic artefacts, most certainly is in the wrong.

Cast an eye over the other OPEC numbers during the mid-1980s and you’ll discover a similar pattern. Iran’s proven reserves jump 50% in one year. Iraq staggers their rise over a handful of years, but still see a 200% rise between 1982 and 1986. Kuwait jumps from 67 billion to 92.7 billion in one year. Saudi Arabia from 169.6 to 255 billion in one year. Venezuela from 28 to 54.5 billion in one year.

All of these increases are unverified, and all occurred roughly around the time OPEC began financially rewarding members based upon proven reserves.

The second oddity I’d like to point out is related to the first, in that it is a result of incentives to maximise reserve claims. It centres around the large number of petroleum exporters who claim unchanged reserves over a period of many years. Either they are asserting that production has no bearing on proven reserves (if I take a quantity of liquid from a full bottle, it remains full) or else they are claiming to have, quite incredibly, discovered annually precisely the same quantity of new oil as they pumped. For decades on end.

The UAE, who leapt from 33 billion to 97.2 billion barrels in 1986, then rose to 98.1 billion barrels in 1987. At which point apparently, new discoveries began to precisely mirror production. In 1988 they again reported 98.1 billion barrels of proven reserves despite pumping and exporting almost 1.6 billion barrels in 1987. The same goes for 1989, 1990, 1991… in fact this continues until 1996 when there’s a reported drop of 0.3 billion to 97.8 billion barrels. Each year since then they have reported no change in reserves. In 2008, the UAE still claimed to be sitting on 97.8 billion barrels of proven reserves.

This pattern is repeated — almost without exception — throughout the Middle East.

In 1987, according to BP, Iraq was sitting on 100 billion barrels. This remained unchanged for 8 years. Then in 1996 it rose to 112 billion. In 1997 it was 112.5 billion where it remained until the year 2000 when it saw a minor increase to 115 billion which is apparently where it has remained ever since. For the 11 years between 1991 and 2002 Kuwait’s reserves remained unchanged at a reported 96.5 billion barrels of oil.

I could go on. And if you think I’m cherry-picking the most damning data, just download the spreadsheet and see for yourself. Also, compare and contrast with non-OPEC countries like Norway who operate more transparent reserve-accounting systems. In those cases you’ll see both reserves and production gradually rise, plateau and fall off. Significantly, in those cases you’ll also note the smaller quantities involved (it’s the people with the vast majority of the oil who are least open about how much they have left).

I don’t know exactly when we’ll see serious oil supply shortfalls, but the consensus of opinion among those who don’t accept the BP data is that it will happen this side of 2020. Potentially a long way this side. Unfortunately, whatever The Guardian might have to say, those people are still very much in a minority. The majority view is expressed by the BP data set… the view that despite the massive incentives to do otherwise, the oil-producing nations are accurately reporting their reserves and that those reserves have not been noticeably reduced by two decades of production.

Official second draft of the new Tory campaign poster

Make your own poster here (via Chicken Yoghurt).

Official first draft of the new Tory campaign poster

Make your own poster here (via Chicken Yoghurt).

Contrary to what those involved would have us believe, investment banking is not actually that difficult a job. Certainly when compared with being a successful surgeon, nuclear physicist or civil engineer; the skill set required by banking is neither extensive nor terribly difficult to acquire.

Which isn’t to say “anyone could do it”. Along with the necessary skills, there are certain personality traits without which, a person would find investment banking extremely arduous. There’s a lot of politics involved, probably more than most jobs, and a person needs to be adept at navigating an upwards trajectory in a cut-throat environment. Also required is a willingness to work more hours than many people are comfortable with. Those tend to be difficult characteristics to acquire. Crucially however, those who already have them are far from being a rare breed.

So the reason successful bankers are paid enormous wages and even more enormous bonuses is entirely down to the nature of the industry they work in, rather than any inherent “star quality” they may possess as individuals. It isn’t due to the hard work of modern investment bankers… humble beginnings investing their pocket money in local community projects when they were twelve, and a few decades later finding their activities have grown into a multi-billion dollar bank. It’s because they got a job in the money industry and were successful at it.

Investment banking deals with huge sums of money. In fact, pretty much the entire purpose of the industry is to move large sums of money around. So when the bank takes a percentage profit on a given transaction, it’s a percentage of a large sum. And this needs to be stressed. They don’t earn huge amounts of money because what they do is extremely difficult (or even all that useful… but that’s a discussion for another day), but because there happen to be more zeroes on their Excel spreadsheets than on the spreadsheets of a bakery or a pub.

Which is why I find the outrage and arrogance of London’s investment bankers, when confronted with a windfall tax on their bonuses, to be so hilarious. They talk about how such a move will force “the stars” of the banking world to leave London for places without such “punitive tax rates”. The implication being that this will deal a serious blow to London’s — and by extension, Britain’s — economy.

I’m forced to wonder if this is just posturing on their part, or do they honestly believe such twaddle? It appears that earning huge salaries for several years has the ability to convince highly ambitious, semi-skilled sharks that they are indispensible. When the truth is that there’s a mass of similar people more than willing to do the same job for 50% of the cash (bearing in mind that 50% of Bob Diamond’s cumulative £20million bonus is more than enough to motivate most people).

I’m also wondering, given that this latest windfall tax will target the bonus payments of “tens of thousands of bankers”, exactly where they all intend to go? Are there really places in the world looking to hire tens of thousands of foreign bankers and pay them huge lightly-taxed bonuses? Is there truly a major lack of experienced investment bankers in New York, Frankfurt or Tokyo?

And even if a handful of banking “stars” do find work elsewhere, the idea that they are taking a unique skill set with them, and that nobody in London is capable of stepping into their shoes, is deluded beyond belief.