Saturday, August 21, 2010

Are We ‘Rushing to Extinction’?

The California Academy of Sciences, located in San Francisco’s Golden Gate Park, is one of the finest natural history museums in the country. If you get the opportunity to go there, I urge you to do so. Unfortunately, not everything in the museum deserves to be called “science.”

The following statement is one of the informational posters that’s part of an area called “Climate Change.” It is like other such claims I’ve seen numerous times in similar venues over the past several years. The poster is titled, “Rushing to Extinction,” and has been part of the exhibit for at least two years that I know of.

Today, we are living through the sixth mass extinction of life in Earth’s history. This is due in part to climate change triggered by the carbon dioxide we pump into the air as we burn fossil fuels for energy. The resulting greenhouse gases are altering the biosphere, which is causing the loss of plants and animals around the world. If we don’t change our actions, we could condemn half of all species to extinction in a hundred years. That adds up to almost a million types of plants and animals that could disappear.

I urge you to read the statement again and consider what it says. Although the statement is extreme and sensationalistic, it is not unusual. It is typical of the conventional wisdom. It is ironic that it is found in what is called the California Academy of Sciences. It is reckless fear-mongering propaganda, not science. It cannot be substantiated and is a total distortion of reality.

For example, it is simply not true that “Today, we are living through the sixth mass extinction of life.” About 770 plants and animals have been identified as having gone extinct in the past 800 years. That’s about one per year. We are discovering far more species we did not know about than identifying extinctions.

The poster implies there are a total of two million species now existing. Biologists don’t actually know how many species there are. Educated guesses range between five million and fifty million.

Even if the total number of species is only two million, it means that if half go extinct in the next hundred years, the rate of extinction will have to increase from one each year to 10,000 each year. What’s the probability of such a massive change? How, specifically, is that going to happen?

Previous mass extinctions were the result of asteroids or ice ages. Have we had one of these lately that I didn’t hear about?

Is the statement defensible? It’s a statement made in a certain context, the Academy of Sciences. Apparently it’s an assertion that is supposed to be accepted based on authority. If you’re going to make such a cataclysmic prediction, shouldn’t you provide a little documentation and support? Is it supposes to be self-evident?

To this point “climate change” has not increased the rate of extinction. We definitely are not currently “living through the sixth mass extinction of life.” To say we will in the future is speculation, about which there is much disagreement, to put it mildly. There is definitely no “consensus.”

The poster is worded as if what it says is beyond dispute. The statements are not qualified in any way. I assume the designers of the exhibit intend for it to be taken seriously.

“If we don’t change our actions, we could condemn half of all species of life on earth today to extinction in a hundred years.” You can get away with about any outlandish prediction you want to make if you hide behind the word “could.” In the context of basic scientific protocol, any such statement should be presented in terms of probabilities as well as a discussion of the specific preconditions to such an event.

Judging from the numerous groups of children I see when I go there, the Academy of Sciences is possibly the most popular destination for Bay Area schools’ field trips. The statement, which is truly frightening if you believe it, is seen by hundreds of school children almost every day. What kind of impact do you think such statements have on young, impressionable minds? It verges on emotional child abuse. The Academy staff should be ashamed of themselves, but I doubt they are.

Environmentalists are so fanatical about their Armageddon beliefs that they think terrifying school children is justified. Do these people ever think about the implications of what they say? Do they care?

The purpose of the “Rushing to Extinction” poster and similar statements is to deliberately frighten whoever reads it. Environmentalists apparently get a perverse thrill from scaring people and making them feel guilty for being members of the human race. The California Academy of Sciences is allowing itself to be used as a venue for manipulative propaganda.

The natural world is fascinating and magical. The best way to illustrate that is to stick with the facts. It’s too bad natural history museums don’t do so.

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Are We ‘Rushing to Extinction’? August 20, 2010

Ron Ross Ph.D. is a former economics professor and author of The Unbeatable Market. Ron resides in Arcata, California and is a founder of Premier Financial Group, a wealth management firm located in Eureka, California. He is a native of Tulsa, Oklahoma and can be reached at rossecon@gmail.com.

Thursday, August 12, 2010

This Recession Is Not Like the Others

As they used to say on Sesame Street, “One of these things is not like the others, one of these things is not the same.” The current recession “is not like the others.” At 33 months it is already more than three times longer than the average length of the other ten recessions we’ve had since WWII. There are no clear signs it will be ending anytime soon. Glimmers of a recovery appear from time to time, but most indicators remain depressed and many are worsening. On balance, the outlook is more negative than positive. Not since the Great Depression have we had two consecutive years of unemployment in excess of nine percent. What we’re seeing is economic stagnation.

Something else about the current situation that “is not like the others” is the defeatism of those in charge. President Obama’s economic advisors, Tim Geithner and Larry Summers specifically, have been warning that unemployment could remain painfully high for years to come. Vice President Biden has declared that we may never regain the eight million jobs lost over the past two years. I don’t think an administration’s spokesmen have ever before been so pessimistic, especially for the long term.

Mr. Obama and his advisors are not draftees. They asked for this job. They asked to be put in charge. They wanted us to believe that they were “the ones we’ve been waiting for.” In no uncertain terms they convinced voters that they would do a vastly superior job than that dufus cowboy George Bush. Now they have been reduced to pleading, “No one told us it was going to be hard!”

This raises a crucial question — why is the current recession so long and deep? A frequent focus of scientific research and analysis is the attempt to explain and account for differences or anomalies. This recession is “not like the others.” A new name has been invented — the Great Recession. It’s being said that 10 percent unemployment is “the new norm.” Why, exactly? What’s changed?

Past recessions have been largely self-correcting. Furthermore, they have self-corrected in a matter of a few months. Why is it taking so long for that to happen this time around? What’s standing in the way of the self-correcting mechanism?

Geithner, Summers, Biden and Obama are all saying “this time it’s different.” They can say that, of course, but they need to elaborate. They are making assertions that cry out for explanations. If you’re going to make a dramatic, unprecedented proclamation, you really ought to provide details and support. If you make a bold statement, you must have some idea as to why it’s so.

The answer is relatively obvious to anyone with open eyes. The overarching factor that is making this recession different is that the Obama agenda is qualitatively and quantitatively different from any previous president’s agenda. The anomaly of the current recession is the anomaly of Barak Obama’s political philosophy and worldview.

A fundamental conclusion of financial economics is that there are two main dimensions to investing — risk and return. What space and time are to physics, risk and return are to investing. When evaluating an investment opportunity, return is the good, risk is the bad. Another basic conclusion is that risk and uncertainty are just two ways to looking at the same thing. Risk is uncertainty in work clothes.

The Obama administration’s reckless and unprecedented restructuring of the economy has greatly increased the level of uncertainty for anyone thinking about investing, starting a new enterprise, or making consumption expenditures. Mr. Obama has turbo-charged the amount of uncertainty in the minds of decision makers. This is an administration with no brakes, and the ride is frightening.

The massive and rapidly growing federal debt overhanging the economy portends future tax increases. Those probable tax increases reduce the expected return of investments. The lapse of the Bush tax cuts is little more than four months away. The bad news is relatively certain, the good news is highly doubtful.

Mr. Obama and his spokesmen need to explain what’s going on with the economy, and how exactly their policies will cure our serious economic difficulties. If they can’t explain the nature of our problems, what are they doing? Are their policies based on nothing more than a hope and a prayer? Why should anyone have confidence in your corrective action if you don’t show that you understand the nature of the problem?

Mr. Obama and his advisors act as though they themselves are hapless victims of the Great Recession. They imply things have gotten so bad we’re just going to have to get used to it. This is pathetic. Rather than rising to the occasion and dealing with the challenge, they whine and blame the previous administration. They need to be rethinking their strategies and analyzing why their previous solutions have not worked. Unfortunately, because of their doctrinaire attitudes, that is extremely unlikely. They will never admit that the fundamental problem is them.

The president is losing the support of even his most ardent supporters. Arianna Huffington, for example, said recently, “The president put all his trust in the wrong economic team — an economic team that didn’t understand what was happening.”

The injuries done by the Obama administration are painful but not fatal. The U.S. economy has fundamental strengths that will allow it to recover eventually in spite of the damage done by the Obama administration.

More and more, voters are recognizing that electing Barak Obama president was a terrible mistake. In November they will have opportunities to begin reversing that mistake and start undoing the damage. As Sarah Palin said recently, “From my house I can see November.”

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This Recession Is Not Like the Others August 12, 2010

Ron Ross Ph.D. is a former economics professor and author of The Unbeatable Market. Ron resides in Arcata, California and is a founder of Premier Financial Group, a wealth management firm located in Eureka, California. He is a native of Tulsa, Oklahoma and can be reached at rossecon@gmail.com.

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