From the monthly archives:

April 2011

Emissions trading: too big to fail?

April 28, 2011

An article I wrote about the EU Emissions Trading Scheme (EU ETS). Extract:

When it was launched in 2005, the European Union’s Emissions Trading Scheme (EU ETS) was hailed as a major step forward in the fight against climate change. Covering 12,000 power plants, factories, and other industrial facilities — and nearly half of EU CO2 emissions — it was the world’s largest cap-and-trade project to date. EU officials saw it as the first of many carbon-pricing schemes that would eventually cover the globe.

Six years later that vision is looking a little clouded. With the EU ETS accused of failing to reduce carbon emissions, countries outside Europe delaying companion cap-and-trade systems, and critics charging that the carbon-trading mechanism has opened the door to fraud, profiteering, and “gaming” by participants, serious questions have arisen about the future of the EU’s grand emissions plan.

As EU members debate the parameters of the next phase, from 2013 to 2020, campaigners are calling for fundamental reforms, or for the EU ETS to be scrapped. Groups such as Friends of the Earth describe carbon trading as a “distraction,” and argue that other measures, such as carbon taxes, would be more effective and less susceptible to abuse.

Before writing the piece, my under-informed opinion of emissions trading was that it was a good idea: not perfect, possibly full of flaws – but a step in the right direction. I thought Europe should be applauded for its comprehensive climate measure, especially as much of the world has done little. Now, though, I’m not so sure. I still think the EU ETS is an achievement, and that there is something to build on. But I’m also not confident Europe will fix the system’s glaring flaws – including various forms of “over-allocation” of carbon allowances, and all kinds of dubious practices around carbon offsetting.

Most of all, I worry that Europe is so invested in the idea of carbon trading that it will continue with the idea even after it has failed. For many, the EU ETS, like the Euro, is an idea that’s too big to fail. It is not only an environmental policy, but also a testament to EU integration, and a certain statist approach. If the EU admits the EU ETS doesn’t work, it also concedes that the EU, to some extent, doesn’t work. It’s hard to see Europe’s grand schemers giving up easily with so much at stake.

Probably, they will continue tinkering with the scheme, in belief that if they can just put a few things right, it will finally begin to deliver. Quite possibly, the EU ETS will go on for years – championed by the EU, and business interests that do well from it – without ever, provably, helping the climate. The beauty of the EU ETS, from its backers’ point of view, is that 1) it looks like a great big policy measure, and that 2) it is very hard to know exactly what effect it is having.

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Exporting CO2

April 27, 2011

This sort of study makes a mockery of claims (by the UK and others) of national reductions in CO2 emissions. In the last few years, we have simply exported emissions to countries that don’t have such strict greenhouse gas controls:

The study, which the authors call the first global assessment of how international trade affected national carbon footprints since Kyoto, says that while developed nations reduced their CO2 emissions by 2 percent from 1990 to 2008, those emissions actually increased by 7 percent when imports were factored in. “This suggests that the current focus on territorial emissions in a subset of countries may be ineffective at reducing global emissions without some mechanisms to monitor and report emissions from the production of imported goods and services,” said Glen Peters of the Centre for International Climate and Environmental Research and lead author of the study.

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Fred’s missing link

April 25, 2011

Fred Goodwin honorary fellowship july 2008

It’s embarrassing for London Business School that it awarded an honorary fellowship to ex-Royal Bank of Scotland CEO, Fred Goodwin, on July 17, 2008, just as the financial crisis was about to get into full swing.

And it’s understandable, perhaps, that LBS would not exactly want to crow about its association.

Goodwin, after all, is a leading face of the meltdown – a man reviled for his pension, over-extended deal-making, and vicious cost-cutting.

But, if you were LBS, would you pretend the award never happened?

That appears to be what London Business School is trying to do. Go to Fred Goodwin’s Wikipedia page, and click on footnote 35 (“London Business School Press Release, 17 July 2008, Sir Fred Goodwin awarded an honorary fellowship (PDF)”) and you’ll find the link goes to the main News page, rather than the press release.

A similar thing happens if you search from LBS’s home page (although the title does appear in the results).

Most intriguing of all, if you go to LBS’s News Archive, you’ll find the whole of July 2008 missing – as if nothing happened that month. See here (click to enlarge):

LBS’s spokesperson, Katherine Lakeland, says the school has not removed anything intentionally; a web overhaul is to blame:

We’re looking into this at the moment, and, as you pointed out, the whole folder for that month’s news is missing, not just the press release about Sir Fred, so we would certainly not have intentionally removed this. Thanks for drawing our attention to that and our tech team are trying to resolve this glitch (hence the need for our web-fit!).

July 2008, though, is the only month missing, and links to other press releases work fine. The archive has been incomplete since at least early-March, when I first tried it, and it’s ten days now since Lakeland said LBS was fixing the problem.

At the time of the crisis, there were calls for LBS to strip Goodwin, but LBS resisted the idea. It now says:

The decision to award an honorary fellowship to Sir Fred was taken by the School in autumn 2007 and awarded in summer 2008. It was made in recognition of the breadth of Sir Fred’s achievements during the entirety of his career to date, including his service as chair of a number of government task forces and membership of a series of international advisory panels as well as his eight year role as Chief Executive at the Royal Bank of Scotland.

Other schools, such as the LSE, have been accused of handing out fellowships in return for gifts or favours. But Lakeland says LBS has never received any financial contributions from Goodwin, or RBS.

LBS made its award, it seems, simply because it thought Goodwin was doing a good job.

(Image: from LBS’s “Alumni News” issue 117, still available at LBS’s web site, PDF).

UPDATE: As of September 2nd, 2011, the link had not re-appeared. Either LBS’s site overhaul is taking a long time, or there’s another explanation.

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Cameron’s five states

April 25, 2011

Colin Talbot, professor of public policy at Manchester Business School, offers a useful way to think about the Tories-Lib agenda, dividing up “the state” into five (security, judicial, fiscal state, economic, and welfare) and comparing the expansion/contraction of each with previous governments. His conclusion is that Cameron-Clegg’s program is more radical than Thatcher’s ever was:

So across the board this is a government seemingly intent on rolling back the frontiers of the state in virtually every area – a far more ambitious agenda than even the fabled Thatcher ever attempted.

That’s my sort of feeling – that people are underestimating the importance of the current government. Across the judicial system, higher education, welfare, the NHS, the agenda is quite radical – probably more so than anything Labour tried (because it was wimpish and always fearful of a backlash). Maybe it’s easier to get things done when you don’t make big promises?

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Are b-schools relevant?

April 25, 2011

My FT article about the relevance of business schools (likely to be irrelevant to anyone reading this blog):

Dan LeClair, senior vice president at the the Association to Advance Collegiate Schools of Business (AACSB), which accredits more than 500 institutions worldwide, says deans are under more pressure than ever to justify what they do. “The deans have been telling us that major donors are asking tough questions like ‘you have all these faculty members who you are very proud of, but can you tell me how this research has made a difference?’,” he says.

“It’s also the alumni and even the provosts and presidents of the institutions. They are all asking schools to not only describe what they are trying to achieve, but also to demonstrate it.”

Business schools are frequently criticised for over-emphasing academic rigour over relevance to practice. And many believe the structures of the business school world feed the tendency: that promotion is based on articles few managers read; and that accredition bodies and rankings providers count journal entries, and citations, to assess worthiness.

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Painter for hire

April 20, 2011

Just wanted to put the word out about my painter friend Matthew Hawkes. He is an excellent portraitist and available for commissions, if you know anyone who needs immortalising. He did me recently (not because I need immortalising) and I think he did a good job. Other pictures here.

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What’s Facebook in Chinese?

April 20, 2011

Today’s irony: the uprisings in Tunisia, Egypt and elsewhere were widely described as “Facebook revolutions” (the phrase produces 720,000 results in Google) yet Facebook doesn’t support – or at least isn’t prepared to show its support – for freedom of speech. Despite its anti-establishment image, the company has failed to join the Global Network Initiative, a human rights coalition that includes Google and Microsoft. It is also prepared to censor its users’ traffic in countries where free speech is limited. Here’s what one Facebook rep told the Wall Street Journal:

“Maybe we will block content in some countries, but not others,” Adam Conner, a Facebook lobbyist, told the Journal. “We are occasionally held in uncomfortable positions because now we’re allowing too much, maybe, free speech in countries that haven’t experienced it before,” he said.

As I’ve said before, we should now know what Facebook is. It is not a democracy tool – at least it is not designed as such. It’s not a college prank as in the Social Network. It is not part of the “free Internet” where everyone gets a say. And it doesn’t have your interests at heart. It is a money-making exercise, where the commodity being bought and sold is your privacy. If it’s prepared to cut its jib in China, what might it do here given the chance?

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Meat is murder

April 19, 2011

As Morrissey said. I’m a meat-eater, but I find this pretty hard to watch (and, as Ezra Klein says, this is the good side of the animal-killing industry). Somehow I can’t imagine human beings will eat meat indefinitely – it seems barbaric, really (one of my silly long-term predictions is that they’ll be a UN bill of animal rights one day). In a way, this relatively kind method is more unnerving than the savage, stupid version. I mean: why did he have to stroke the cow’s nose moments before shooting him?

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This royal republic

April 19, 2011

Royal Family

Excellent article by Jonathan Freedland about the indestructibility of the British royal family. What with Andrew’s dodgy dealings with dictators, and the optics of a lavish wedding at a time of austerity, it should be a difficult moment for “the firm”, he says. But no: the media are falling over themselves to cover Wills&Kate, Elizabeth II is loved (The King’s Speech helped), and, most strangely, posh is cool again – for the first time in a long time.

Two points I want to pick out:

First. We imagine ourselves to be (mostly) free of discrimination, yet put up with blatant bias where the royals are concerned:

..twenty-first-century Britain likes to believe that ethnic and gender equality is the common sense of the age. Yet the monarchy stands apart. Under the Act of Settlement of 1701, only a Protestant can succeed to the throne. Similarly, the rule of primogeniture still obtains: if William and Kate have three daughters and then a son, the boy will leapfrog ahead of the girls in the line of succession. Egregious discrimination, which would not be tolerated in any other sphere of British life or employment, still applies when it comes to the office of head of state. Indeed it is enshrined in law

Second: Republicanism is a waste of time until Liz leaves the stage. Her power stems not only from her position, but from being a link to the war years:

It is not only that she was around a long time ago; it is that she was around then, during what Churchill predicted would be known thereafter as Britain’s finest hour. She is the last living connection to an episode—the island race standing up to Hitler—that has become the foundation story, almost the creation myth, of modern Britain.

The annoying thing about Will+Kate and the King’s Speech is they are doing a good job of re-launching the royals at a moment we should seriously be thinking of alternatives. My position is we cannot claim to have democracy while we are ruled by hereditaries (even nominally). People say they are “above” politics – but this is only partly true. They are above the day-to-day scrap, yes. Yet they take up a big piece of the “political economy” of the country. And, most insidiously they cement a view of ourselves as subservient, rather than masters of our own affairs. They are the apex of a class system that does more to disenfranchise than any poorly-designed voting system, or school system.

The basic problem with scrapping the monarchy is emotional, though. People like the feeling of the royal family, even if they appreciate arguments about their illegitimacy. Sensible folk end up saying things like “well, they don’t do any harm do they?”, or “they bring in the tourists, don’t they?”. They also fear what would come next: who would have the stature?

True: it would be hard to replace Liz. But Charles will be a less formidable foe. His heart clearly isn’t in it. People distrust him over Diana. He doesn’t have the automatic credibility of his mother. With Liz gone, it will be easier to make the case for electing a president, or at least severely limiting the monarchy’s powers.

(Image: Spacebahr)

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Facebook: it helps to be dull

April 18, 2011

It’s long been suspected that Facebook-obsessives are boring – but now comes proof, in the shape of a study by Bu Zhong and Marie Hardin at Penn State and Tao Sun at the University of Vermont.

The researchers contacted 436 college students last year, asking each to carry out an assessment of “need for cognition” (or NFC – “a recognized indicator for deep or shallow thinking”), and a questionnaire about their “social network site” (SNS) use.

“The key finding,” the authors write, “is that NFC played an important role in SNS use. Specifically, high NFC individuals tended to use SNS less often than low NFC people, suggesting that effortful thinking may be associated with less social networking among young people.” Moreover, “high NFC participants were significantly less likely to add new friends to their SNS accounts than low or medium NFC individuals.”

Basically, people with high “need for cognition” used Facebook and similar sites less.

Nicholas Carr concludes: “If you want to be a big success on Facebook, it helps to be a dullard”.

Whether this holds true for a wider population is an open question, though. Maybe it says more about students than Facebook?

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