Sgt Hulka Uncut

uncensored opinion and technical information on stuff

Archive for March, 2012

Fearing fear itself

Mar 27

Posted by Sgt Hulka in Bad Ideas, Climate Change, Economics | Comments off

I recently read an article ominously entitled:

“SMEs will be hit with carbon tax reporting requirements”

The article is based on a survey performed by the Australian Institute of Management, and provides the opinion that small business (SMEs) will have carbon tax requirements passed on to them by the major emitters that pay the tax, when they are in the supply chain of the large companies. I think this article, while presenting some very interesting information, gets its analysis wrong for a couple of reasons that I detailed in comments to it, but unfortunately they were not accepted so I will present them here.

While I do expect large companies to require information from their supply chain regarding their activities and energy use so that the large emitters may complete their mandatory filings and purchasing of carbon credits, any attempt to turn the supply chain on its head and pass down costs to the supply chain will not be the result.

Further, I believe that the conclusion that a significant number of large businesses that make up the 700 or so companies that are currently covered by the NGERs legislation from 3 years ago, and will start having to pay the carbon tax in July will pass on requirements to their supply chain in a manner that is going to be detrimental in time and money costs on that supply chain is overstated.

The truth is, most of the NGERs companies that will be required to acquit permits at $23/ton to the Australian Government will be acquiring and acquitting those CO2-e credits (and therefore paying their tax) on the basis of CO2-e emissions that come from burning fossil fuels and manufacturing process industries. It is clear that based on these increased tax payments, electrical utility suppliers will pass on costs to everyone, including small business. But that may be the end of it for many SME’s, based on the nature of their operations.

Where any large business wants to “pass on” requirements to reduce emissions to its supply chain, or require the supply chain to document their emissions of CO2-e , this will mostly be passing on requirements to establish energy use/efficiency information in most cases, since suppliers are not primary emitters of CO2-e. Primary emitters of CO2-e are typically large electrical power generators and some high carbon intensity industries, like cement manufacturing. These large primary emitters are the subjects of the regulations of carbon emissions to meet the country’s long-term goals to reduce emissions. However, all businesses can benefit from examining their activities on the same basis that large companies are required to do.

Basically, all companies should see the carbon tax as a heads up that they should start to “internalise” their emissions of combustion products from fossil fuel burning and energy use. Any business (large or small) that gets that change in their mindset can then begin the process of determining where they are at with respect to their competiveness related to these additional characteristics of their performance.

As the only HSE Consultancy in Australia to be Carbon Neutral certified, my company (An Meá) has direct evidence that the process of documenting CO2-e performance (and even voluntarily participating in the CO2-e neutral programmes) is not difficult or that costly. Anyone telling you otherwise should be required to demonstrate their case in the same manner we can.

The only of those companies that have anything to fear are those that do not have any interest in what their energy efficiency is, or think climate change is a hoax. If you are in that basket, you are going the way of the dinosaur. However, if your organisation does not have a philosophical issue of doing something about CO2-e, or simply wants to benefit from energy efficiency, primarily, then you might see more benefits (and opportunities) than detriments.

More evidence piles up

Mar 26

Posted by Sgt Hulka in Climate Change, Good Ideas, Science | Comments off

Additional information is working its way into mainstream media regarding the number and severity of weather events, and whether they are possibly the result of climate changes. Its a question I have raised and discussed a of times (here or number here).

This was also coincidentally the subject of a discussion between myself and my buddy Otto recently. The bottom line, that I think I got his buy in on, although he remains skeptical about pretty much anything if left alone long enough, is that an average rise in temperature worldwide will be more likely to manifest itself as chaos due to an increase in entropy. Therefore, these latest scientifically verifiable observations support my thesis.

Transplant is likely a misnomer

Mar 26

Posted by Sgt Hulka in Evil Motherfuckers, International, Politics | Comments off

I understand that Dick Cheney’s operation has opened up the debate about whether he got special treatment or moved up the donors list.

I can tell you that while he may have used influence to get the kids heart (probably with lots of his blood while you are there), he certainly deserved it more than most on the list because he didn’t have one to begin with.

There’s a difference between cunning and intellegence

Mar 21

Posted by Sgt Hulka in Climate Change, Economics, Evil Motherfuckers, Other Topics, Science | Comments off

So, the Minerals Rent Tax has made it through the Senate and will become law on 1 July 2012, delivering a 30% tax on the wealth dug out of OUR ground by a few to make THEM bazillions. And despite the likely legal challenges from Twiggy on a constitutional basis that are unlikely to hold water {cough cough, petroleum rent tax at 40%}, the law is likely to hold. And fair enough. There is certainly nothing wrong with all of Australia sharing in the wealth of minerals we all own, and nothing unfair in taxation that is drawn from wealth that is currently being generated in Western Australia versus the more populous eastern states. Remember that it was only up until the very recent past that Western Australia wasn’t supported annually through sharing wealth of the east over here. You didn’t hear anything about unfairness of taxation from the sand-gropers when their schools and roads were all being subsidised by the folks out east. Remember, we may need them again when the boom goes bust, because the GDP in Australia is still primarily generated in NSW and VIC, despite the current mining boom (ref. Wikipedia)

Screen shot 2012-03-21 at 7.51.25 AM

But so as not to miss out on the news cycle that reported the Minerals Rent Tax, one of the current new developments that he is not suing anyone over, Clive Palmer instead waded into the conspiracy theory market, accusing Greenpeace of being funded by the CIA to undermine Australian coal exports. He’s already backing off the statements made, as he is demonstrably full of shit, but I bet the retractions don’t make the national radio and TV like the first assertions did. Funny that.

Now if Clive was really worried about a conspiracy of foreigners trying to shape the debate here in Australia, he would watch a bit of Media Watch and then look into the funding of the fluffy sounding Australian Environment Foundation, and Australian Climate Science Coalition. What he would see is that virtually all the funding coming from German and US agrichemical companies and the American Climate Science Coalition. The AEF and CSC promote views that are based on climate change denial from the US and have an agenda on the Murray Darling Basin that are not in the public interest as much as they are in the interest of the agrichemicals industry. Also very funny that.

Pity none of the networks that take statements from the AEF point out these connections when they are basically reading off the AEF’s media releases to meet their story deadlines, or that Clive isn’t railing on the TV about them.

Now I acknowledge that a lot of these super rich mining magnates got there by their own skill and hard work, but an equal number got there by coming from a life of privilege, their connections and inheritance, or simply making a big pile of money a huge pile of money by turning the handle on machine already invented for them.

That’s cunning, not intelligence. So the next time you are at something that Clive is presenting at, feel free to call him out on his bullshit, as you are more likely than not to win the argument. He has all the intellectual depth of a carpark puddle, and is possibly also going burko.

You ain’t no Darryl Kerrigan

Mar 15

Posted by Sgt Hulka in Bad Ideas, Climate Change, Politics, Snake Oil | Comments off

I reckon Clive Palmer might have gone burko, and is having delusions about having gone to law school instead of into real estate as a young fellow. But whatever the cause, he has moved off free speech as his focus last week on the constitutionality of taxation this week. Busy guy. Perhaps he reckons he can do it all: run his magic dirt and mineral enterprise, fight the FFA/FIFA, fight the mining tax and fight the carbon tax all at once. Or perhaps he is a full of shit, bluffing windbag.

I’m not a constitutional lawyer, but here is why I will go with option 2:

1. The Federal government has the right to impose taxes and duties. This has been tested a number of times, but is pretty solid, based on the amount that my company and I pay every quarter. I don’t reckon Clive is on a winner, if he wants to take on the constitutionality of taxation in general.

2. The Federal government has the right to identify air pollutants of concern and regulate the collection of data on them and their emissions into the receiving environment. We have about 40 years of precedent in this area generally. With respect to CO2, the basis upon which the carbon tax will be collected is the data generated under the National Greenhouse and Energy Reporting (NGER), and despite the huge shit fight over its introduction in industry, no industry lobbying group (and all the big ones were involved) ever suggested it was unconstitutional. It has also passed muster on the basis of sound scientific methodology, so there goes any arbitrary and capricious argument.

3. The Federal or State governments have the right to apply fees (or taxes) to companies that want to discharge pollutants to the common environment in their jurisdiction. Tipping fees, sewage charges and even air pollutant emissions are charged by State and Local governments now, and the extension of this to the Federal Government is not a huge reach in logic. He might be attempting the challenge in this area on the basis of an argument of Intergovernmental Immunity (thank you Wikipedia):

“… the Engineers’ Case held that there was no general immunity between State and Commonwealth governments from each other’s laws, the Commonwealth cannot enact taxation laws that discriminated between the States or parts of the States (Section 51(ii)), nor enact laws that discriminated against the States, or such as to prevent a State from continuing to exist and function as a state”

He may also want to make an argument based on an argument that the new law does not fall within a permissible head of power granted to the Commonwealth government by the Constitution.

While either of these is a possible route of attack, the case of the Carbon Tax being applied to the whole of the country is not likely to be found to be discriminatory against any state, and if this type of taxation of a pollutant is found to be a States’ right rather than the Commonwealth, there are one or more easy workarounds to deliver the intent.

4. But the most obvious reason this constitutional challenge isn’t going to hold water came from Clive himself. Clive was not willing to leak the details on the 730 Report of the precise basis of the means by which the carbon tax is unconstitutional. If he had anything, he’d come out with it. See, constitutional law isn’t like a regular tort. It isn’t like Clive would benefit by hiding his most excellent constitutional argument for a packed courtroom, spring it on the packed house and unsuspecting government barristers, get a judgement and penalty in his favour on the day and be carried off on the shoulders* of his supporters and then next day be much richer. If he had anything worth a damn, he would have won the argument last night with it.

Now, if there were some technicality that did allow the High Court to rule the carbon tax unconstitutional, the government would merely find another means by which to attach its revenue generating mechanism to existing sources to achieve the same effect**. For instance, it could use the NGER data collected to establish the amount owed by each business, then reduce the amount of GST or mining tax revenue returned to the individual states with the identification of the business that the reduction was due to, then suggest that the State recoup that revenue through rate-based licensing regulations that are already on the books by simply adding CO2-e to the pollutants of concern that they “tax” now.

But let’s hope Clive gets lots of lawyers in Sydney and Canberra involved, because that part of the country needs some stimulus. It would really nice if, like in a tort, the Federal government could recoup its costs from Clive when he is unsuccessful.

* if you could even picture that
** as it says right in the legislation, a similar case to many other precedents where a specific law was found unconstitutional, but that did not prevent the Commonwealth from delivering the intent of the law through other mechanisms.

The Dogs of War

Mar 13

Posted by Sgt Hulka in International | Comments off

I didn’t comment on these instances individually, but based on the latest one, I feel compelled to. Marines pissing on their kills, burning Korans out of negligence, and now a killing spree by a US Army sergeant all serve to reinforce a point I have made verbally over a number of years, but now will put into writing: It is a large mistake to use a military force to serve as “peacekeepers” or policemen in the role they have been forced into by NATO and other Commonwealth forces in the past 20 years.

Whether or not we have a role in the next 2 years (or 20) in Afganistan is a separate issue, but there is no legitimate role for the military there, even the military police with some training in the area of how a civilian police force is meant to work. Having spent time in the US Army myself (also as a military policeman), I have great respect for what the troops can do, and I am proud of their work as a military force, despite the occasional situations which are appalling, or even those that seem appalling if you are not in the field with them.

See, most of the people doing the work in the military are pretty young, typically in their early 20s. They are very highly trained in their roles (all of which are related to warfare) and each and every one of them is trained in basic combat arms, and (hopefully) conditioned well to do their job in a time of warfare. But primarily, they are young, trained to kill efficiently and controlled more by their hormones than their wisdom. And while we may want to have “surgical” airstrikes, precision special ops and excellent intelligence that allows us to avoid all civilian deaths, the truth is, that isn’t what is going to happen in practice, nor is it really planned for by the bulk of the forces. War is still primarily about killing your enemies and taking and occupying their land until the shooting stops from their side, and when the shooting starts, every battle is about yourself and your comrades closest to you. Based on this, the circumstances are so absurd and out of the ordinary from normal experience that we honestly should expect situations to match.

That doesn’t mean that we should not attempt to avoid war crimes, or that we should cover them up when they occur. I would council in every way I thought effective all troops that reported to me to follow the rules of war and would support full prosecution and punishment of those guilty of crimes during wartime. But I would not to expect them to not occur, especially when the troops are exposed to years of stressful situations, in an environment where they seemingly have no friends, and atrocities (from their perspective) are committed upon them. Honestly, try to put yourself in the situation of the troops in Afganistan, or even Iraq. The use of roadside bombs (IEDs) and suicide bombers on what are essentially sitting targets is a significant part of the modus operandi of the opposition in these wars. I don’t condone it, but I certainly understand how these situations happen.

Every situation is different, and there isn’t enough information available to fully judge this latest occurrence, but each time a new atrocity occurs, I find myself first thinking these days that we have to get our boys the fuck out of there. They cannot do enough man-days of good to overcome the bad (and the bad that will be done in a PR and political sense) that can be done by one guy with a gun, regardless of how he got there.

Here’s what happened, and how it did

Mar 6

Posted by Sgt Hulka in Bad Ideas, Economics, Good Ideas | Comments off

There is no way I can summarise what happened during the GFC, and provide an analysis of how it played out the way it did better than the Professor Krugman, so I won’t try. Read for yourself his remarks in Portugal last week. Read them critically, for the facts and for where he clearly identifies what his opinion is on the matter. Because the facts are the facts, and whether you agree or not with the hypothesis of the failure to respond, it is a fantastic summary of the events.

And then have a think and see if you can come up with an alternative explanation on why so many “very serious people” got the response to the crisis very wrong, because its important. It’s important because Europe still has a vast amont of private debt that it has to de-leverage from, not to mention the sovereign debt, and the currently proposed all-austerity approaches all smells like failure.

To me, the big failure I define in terms of efficiency. You can have an argument over what the role of government is in relation to an economy, but the argument about whether it can have an effect is over. The loss by not doing effective stimulus (a large amount of tax cuts aren’t stimulus) in the US and Europe is incredible. Imagine if the US had done a 1.2 trillion dollars of real stimulus (as opposed to 300 billion of stimulus and 400 billion of tax cuts mostly to the rich that then did not trickle down). Now imagine if the US had borrowed most all of that at 1% (which it still can by the way, check the US long term bond rate). Imagine how effective that borrowing would have been had it been ploughed into the infrastructure repairs needed countrywide, the teachers that need not have been laid off or not hired in the first place, and the beginning work to transform the transmission grid in the US to set it up for the energy efficiency and micro-generation improvements that could solve the vast majority of its greenhouse problems without anyone having to modify their lifestyle. Now think about the generation of people who have left or are leaving university in various disciplines in the past 4 years and the next two that would be employed in their chosen field.

I call the efficiency loss and failure to capitalise on the possible gain monumental. Personally I would love to be able to borrow all the money I wanted for 1% for 10 or 30 years. I bet I could do some good things all on my own.