Pincas Jawetz on climate change, energy, Oil and Gold Price Relationship; O' CANADA; more

In "Me and My Hybrid," Oliver Sacks writes that when he traded his Lexus 300 ES sedan for the six-cylinder Honda Accord ECO hybrid, he started averaging 40 miles to the gallon. Doing 20,000-30,000 miles per year, he saves 500-1,000 gallons of gas per year and will make up the extra cost in a year or two; he will also cut by half his CO2 emissions. Now, with some 200 million cars and light trucks on the road in the US, and if even half of them saved as much fuel as he does now, the total savings would be 50 billion or more gallons of gas a year. - or the equivalent to 1.2 billion barrels of oil, per year. This equals about half of the entire annual production of oil in the United States and a fifth of what the most reasonable estimates hold can be recovered in total from the Alaska refuge; a blip in US oil consumption. Sacks says that there are many ways to save energy but none as easy as this. For incentives he brings up creative ways found in other countries e.g. the UK allows clean vehicles exemption from the fee paid by other vehicles to enter congested areas of London during rush hours. He suggests for New York City a free Green Lane at bridges and tunnels as an inducement.

In "The Truth Beneath the Surface," Professor emeritus of geology at Princeton, Kenneth Deffeyes, who has was with M.King Hubbert at Shell Oil, when he predicted correctly in 1956 that US oil production will peak during the early 1970's, points out that "Despite its size, Prudhoe Bay was not big enough to reverse the decline of American oil production. The greatest year of US production was 1970, Prudoe Bay started producing in 1977, and never enough to bring back the US production to the 1970 level.

The Arctic refuge, with the most optimistic estimate of equaling half of Prudhoe, will have even a smaller effect or rather no effect. Prof. Deffeyes says that geologists using the Hubbert research method have indicated that world oil production would reach its apex in this decade or 30-40 years after the peak in American oil production. He believes that this is a factual truth and his own independent research puts the date at 2005 or early 2006. Even if oil could come out from the Arctic refuge in 2008 or 2009, it would have no effect on our economy. He believes that the controversy over the Arctic refuge is a side issue - THE PROBLEM WE NEED TO FACE IS THE IMPENDING WORLD OIL SHORTAGE.

And what can we do? "More efficient diesel automobiles, and greater reliance on wind and nuclear power, are well-engineered solutions that are available right now. Conservation, although costly in most cases, will have the largest impact. The United States also has a 300-year supply of coal, and methods for using coal without adding CO2 to the atmosphere are being developed."

In "Coal in a Nice Shade of Green". Thomas Homer-Dixon of the University of Toronto, and S. Julio Friedman, of the Lawrence Livermore National Laboratory, write about the use of 'Green" coal as a gasification of coal and the sequestration underground of the resulting CO2 produced. The process used is an integrated gasification combined-cycle facility where you can use any fossil fuel including coal, as well as wood chips, corn husks, or any biomass, strip out sulfur and heavy metals to obtain a hydrogen rich gas of which you strip the CO2 and inject it into geological formations.

Interestingly, the Homer-Dixon and Friedman article points out that nuclear energy is not a possible answer because if that were considered, the US would have had to build another 1,200 nuclear power plants in addition to the existing 104 - or starting now one plant every two weeks until 2050. They also point at the demand side, and the fact that policy makers and consumers have sadly neglected to make investments in conservation and energy efficiency.

The fourth article on the OP-ED page is by New York Times columnist Bob Herbert and on its face deals with a rather political different topic, nevertheless, I found here a connection in his attack on the press and the public being distracted by one sensational news after another - Terri Schiavo, Michael Jackson, steroids in baseball, etc. while much more important things happen right there in front of their nose. I was missing Herbert continuing by mentioning the Arctic National Wildlife Refuge as Professor Deffeyes did. The idea behind the Bob Herbert column "The Era of Exploitation" is that we are being bamboozled by Washington into paying attention in the wrong direction while someone else walks away with our past life savings or our future - period.

by PINCAS JAWETZ (PJawetz@aol.com)

Culture Change Media International Editor

New York, NY - January 14, 2005

January 13, 2005, seemingly, was Jan Egeland day at the U.N. in New York and at the larger international community in New York as well.

Mr. Jan Egeland is the embattled, but rather successful and well-meaning, U.N. Under-Secretary-General for Humanitarian Affairs and Humanitarian Relief Coordination - OCHA, the second largest office at the U.N. He is the emergency Relief Coordinator in the post-Tsunami world activities. His troubles were caused by a statement of his, made to the press in Geneva, that a new outside auditing system of the record expressions of generosity for the victims of the Tsunami will not only guard against misuse of funds given to the United Nations (in this time of U.N. criticism in the follow up to the "oil-for-food issue"), but will also make sure that governments indeed meet their pledges.

Mr. Egeland's comments are based on reality of pledges made to help Honduras and Caribbean island-states after the hurricanes of 2004, and the reality that only a very small fraction of these funds materialized after the dimming of the lights of publicity - to be exact - only $19 million came in from what was pledged after hurricane Mitch - really , only a very small fraction of what was promised. The lights moved to the next emergency and next public disaster area, and the old emergency was forgotten by the donors. Mr. Egeland also listed the main donor countries in order of the size of their donations, and in response to a journalist said something about stinginess of the largest economy which was taken to mean the U.S. The above caused an uproar by a sector of U.S. publicists and even some name-calling from the likes of Pat Buchanan.

Nevertheless, outgoing U.S. Representative to the United Nations, Ambassador John C. Danforth, who served at the UN only for half a year, in his remarks to the Security Council January 13, 2005, said that his half year at the UN showed him the importance of the institution despite the oil-for-food issue, and gave the various peacekeeping efforts and the UN's response to the tsunami disaster, as instances where the United Nations has demonstrated its essential quality. Was he coming to the aid of Mr. Egeland?

January 13th started for me with an 8:00 a.m. briefing by Mr. Egeland at the Asia Society. This meeting was organized by former US Representative to the UN., Ambassador Richard C. Holbrooke who was, as assumed, Senator Kerry's favorite for becoming US Secretary of State, and who is now Chairman of the Board of Trustees of the Asia Society. Mr. Holbrooke started by giving a long and detailed profile of Mr. Egeland who in his formative years was a Fullbright Scholar at U.C. Berkeley, a fellow at the International Peace Research Institute - Oslo, and a fellow at the Truman Institute for Advancement for Peace - Jerusalem. He was the Chairman of the Norwegian Amnesty International and Vice Chair of the International Executive Committee, and headed the Norwegian Red Cross. He co-initiated and co-organized the Norwegian Channel between Israel and the PLO in 1992 which led to the Oslo Accord. At the U.N. he was involved in peace negotiations in Colombia and Guatemala and led the host delegation for the Oslo adoption in 1997 of the Ottawa treaty to ban land mines. In short, Mr. Holbrooke, who said that Egeland is a friend of his since a long time and has 25 years worth of credentials on humanitarian issues that can not be sullied by the likes of Pat Buchanan! January 13th ended for me at an evening meeting of the U.N. Association of New York (UNA-NY) where Mr. Egeland spoke again on "Humanitarian assistance in Asia - Tsunami Crisis. (Someone in the audience pointed out that Somalia is in Africa).

The U.N. Flash Appeal of January 6 brought at the Geneva Conference $738 million from governments, the figure stood by January 13 at $5 billion. 5,000 miles of coastline are affected with 5 million people in need. The rescue and rebuilding operations are complicated further by the fact that the area affected includes three conflict zones - Aceh in Indonesia, the Tamil Tiger activity in Sri Lanka, and Somalia - causing mixed feelings by members of the host governments.

Further, it is obvious that what has happened must also prompt us to new activities that will help decrease the effects of such future events.

- to capitalize on increased awareness to get serious about disaster prevention and risk reduction.

- to create a Tsunami early warning system in the Indian Ocean. He said that this would cost $30 million - just think how this pales in comparison with the present losses.

- the upcoming World Conference on Disaster Reduction in Kobe, Japan, to be chaired by Mr. Egeland.

Further, given that earthquakes and Tsunamis are not novel phenomena, nevertheless, there is a new aspect to worry about: the fact that the global ice caps are melting. Considering the shape of the earth is such that the globe, because of the weight of of the solid ice caps, is flattened somewhat at the poles, the melting of the caps will release some of this pressure and cause further movement of the earth plates. This movement causes earthquakes, and earthquakes bring about Tsunamis. This theory may thus predict an increase of this sort of event not only for the Pacific. The above question was presented to Mr. Egeland at the evening meeting and he said that he has not heard this before, but what it means is that we should also use less cars.

So-called natural disasters may not be ordained by nature after all. The hand of man may have to do something with all of this. The fact that a Norwegian, whose country's economy is largely based on oil is recognizing the problem - in public - is readily proof to me that Mr. Holbrooke's laudatory of Mr. Egeland was just right. Mr. Egeland is indeed capable of the altruism needed to do a honest job out of the predicaments he is being faced with; he may indeed be among the best the U.N. is capable of, as said by Mr. Holbrooke, and reinforced by the unexpected Danforth comments that same day.

Should the post-Tsunami activities include also mitigation of the effects of Climate Change, and reinforce our vigilance in looking for effects of the man-caused release of fossil carbon into the atmosphere? An increase in the frequency and strength of earthquakes may point to this need. The U.S. Academy of Science has already pointed out the possibility of catastrophic environmental changes because of our over-dependence on fossil fuels.

It is a given, when there is political turmoil and the price of oil goes up, so does the price of gold rise. Austria is not an oil power, but it decided to become a gold power. When the Austrian mint was purchased by the Central Bank from the Ministry of Finance in 1989, a decision was taken to mint a one-ounce bullion coin in pure gold. Austria decided not to mint a commemorative coin, such as a Mozart gold coin -- it rather opted for a "living Institution," and Austria's most famous institution is its Philharmonic Orchestra -- so was born the Vienna Philharmonic gold coin. From 1989 to 2004, a total of 8.3 million coins were sold, stacked, one on top of the other, that would reach almost 45,000 feet.

To mark the 15th anniversary of the "Vienna Philharmonic" success story, on October 5, 2004 the Austrians unveiled at the Neue Gallerie in New York, the biggest gold coin ever minted. This is a monster Wiener Philharmoniker coin that weighs 68.57 pounds, or 1,000 troy ounces of pure gold. The diameter is 14.5 inches and it is 0.79 inches thick. It has a face value of 100,000 Euro, at present exchange rate about $US 121,000.

It looks like it could be used as legal tender for paying for oil -- though we must note that the oil business is still done in US dollars rather then in Euro. Nevertheless, the oil exporters, having learned about the low value of the US currency, do indeed hedge their deals by betting on the monetary exchange values. That is why, unless we take steps to introduce alternate fuels to the presently used petroleum fuels, the above coin in a time of $60/barrel could be used very soon to buy about 200 barrels of oil. That is unless the price of gold also moves up and then Austria could get probably 220 barrels per coin.

The "Vienna Philharmonic" is the only bullion coin with a Euro face value. As such it presents itself around the world as the investment coin from Europe. Its chief overseas markets are North America and Japan. In the US it has a respectable 7% of the market alongside the Eagle and the Canadian Maple Leaf. In Japan two out of every three buyers now choose the Euro coin. More seriously, it can be expected indeed that oil exporters may choose to store value in these coins at a time of "termoil."

Professor Mundell also mentioned that if there will ever be a real global currency it will be backed not just by paper but in part by gold. Remembering the discussions years ago of having a whole basket of commodities to back the currency, it seems that oil may have a part to play here also. Oil in storage may then be as good as gold.

The UN tried also to play with the subject -- gold. At the end of the seventies/beginning of the eighties, the UN Institute for Training and Research (UNITAR), tried to figure a way how to deal with countries that had a non-convertible currency. As, at that time, the world included the two blocks - the Eastern Europe and Communist countries, and the Developing countries, the Research desk at UNITAR decided to focus at first on the Soviet Union and on Brazil. Both countries are exporters of gold. Their sale of gold to the commodity market tended to depress the price of the commodity, so UNITAR thought that if instead of selling the gold, the Soviets and the Brazilians could rather deposit the gold in some acceptable neutral bank, i.e. in Switzerland or Austria, such a neutral bank would then issue papers backed by the deposited gold. Without the actual sale, these papers would trade at a premium, because the commodity did not reach the market, and would remain the property of the respective countries.

These gold-backed bonds would thus bring in to the previous exporters more than the sale of the commodity, and would also provide these countries with papers that were in effect a convertible gold backed currency. The idea sounded neat but was rejected by the Soviets. In retrospect, one could say that the history of the Soviet Union may have been perhaps longer had they given their backing to above idea.

The International Institute for Sustainable Development (IISD), headquartered in Winnipeg, Manitoba, Canada, in cooperation with the Washington DC based Center for Clean Air Policy, and the Caracas, Venezuela, based Cosultores Cambio Climatico y Desarollo (CC&D) active now also in Bogota Columbia, held an International Seminar and Workshop on Transportation and the Clean Development Mechanism (CDM) - one of the tools originating in the Kyoto Protocol to the UN Framework Convention on Climate Change.

The seminar was held in Santiago de Chile, August 25-28, 2004. This activity was generously supported by the Canadian International Development Agency (CIDA), the Canadian Department of Foreign Affairs (DFA), in cooperation with Transantiago, the Chilean agency that is supported by CIDA. The Canadian Government has even established a CDM and Joint Implementation Office (JI). This office looks out for potential JI projects and the potential for obtaining pollution credits under the Kyoto Protocol (KP) by helping implement clean development projects overseas; with particular interest in the region of the South American cone. Transantiago is the larger municipal transportation authority of the metropolitan Santigo region. By helping Transantiago organize a well planned mass transportation system, starting with bicycles used to reach small local buses that take the commuter to large, articulated, 18-meter long, Brazil made MarcoPolo Scania buses. By avoiding the use of small private cars, CO2 emission credits are created, and the money paid to buy these credits can then be used in the further implementation of the project. When Europe starts these trades, even before there is an official full ratification of the KP, Canada will be right along for this innovative approach to help slow down the disastrous roll of the Hummers and the SUVs as practiced by other highly developed countries. On August 27 I had the chance to see the equipment to be used by Transantiago.

The seminar included other projects i.e. TransMilenio of Bogota, Columbia and projects in Malaysia, India...

As said, the activity by Canada stretches out also to other countries in the region. As such, back in New York, I received an e-mail invitation to a September 21 seminar in Buenos Aires, Argentina Seminario Internacional Sobre Medio Ambiente y Cambio Climatico, that included a session on Argentina-Canada project CACBI for the increase of the capacity to participate in the CDM.

Further, remembering that December 6-17, 2004, the COP10 of the UNFCCC will be held in Buenos Aires, it becomes clear that Canada will be well positioned for leadership at this year's crucial Conference of the Parties.

In light of the above I decided to watch for the presentation of the Canadian Prime Minister, The Right Honourable Paul Martin, September 22, 2004 at the 59th Session of the UN General Assembly.