'Environment' Archive
Good-bye, banking and construction, hello coffee shops! As my beat at Hoover’s has changed from the banking industry with its current “Song of the Volga Boatmen” soundtrack, I am now covering other industries that provide slightly more happiness in these troubled times.
Specifically, coffee shops. And here is what I’ve learned: Fair trade may be most well-known in connection with coffee, but it’s no longer restricted to the queen of beans. Now, items labeled fair trade include chocolate, flowers (also another one of my new industries), fruit, sugar, rice, and more. Even products with multiple ingredients such as baked goods can be labeled “fair trade” since many of their ingredients come under the label.
Why is fair trade booming? A part of it comes from a sense that one can have one’s morning buzz and help the world, too. Fair trade increases the money that goes to farmers and growers in poor regions. It encourages the use of organic farming techniques and supports growing cooperatives that give farmers more clout in marketing their crops.
Like microlending, fair trade recognizes that there’s a little capitalism inside all of us.
Especially now that the banking industry seems to have decided to unleash its inner socialist, that’s kind of refreshing.
Sort of like that cup of coffee first thing this morning.
Some pirates have hijacked one of Saudi Aramco’s supertankers on the high seas and sailed it to the coast of Somalia. It contains a cargo worth $100 million.
The Sirius Star, with a full load of about 2 million barrels of Saudi crude (more than 25% of the kingdom’s daily output), was captured November 15 some 450 nautical miles southeast of the Kenyan port of Mombasa, and was rerouted to the Somali port of Eyl.
Surprised about the audacity? You bet. However, maybe we should not be. Piracy does not belong exclusively to the days of Sir Francis Drake, the American privateers, or that rummy character Captain Morgan. It is a common fact of life today in some of the world’s busiest sea lanes, such as the Straits of Malacca, the South China Sea, and off of Africa’s east and west coasts. About 200 incidents were reported to the IMB Piracy Reporting Centre in the first nine months of 2008. Of these reported acts of piracy, some 115 vessels were boarded, 31 vessels hijacked, and 23 vessels fired upon. These incidents led to 581 crew members being taken hostage, nine were kidnapped, nine killed, and seven are missing. Serious business.
The Gulf of Aden and the Indian Ocean off of the east African Coast is the world’s hot spot for piracy. In 2008 alone there have been reported 66 piracy attacks off of Yemen, 11 off of Tanzania, and 9 off of Kenya. Somalia’s pirates are the boldest, willing to commandeer any vessel of any size. Somalia has been devoid of a stable central government since 1991, and warlords and their militias rule the land and the sea and have become more audacious and more successful in the piracy business in recent years. The main aim of the hijacking of vessels is rarely to make a political statement, or for the commodities on board, it is the ransom money that can be extorted from the vessel’s owners ($30 million in the past year according to some accounts). Money that can equip militias with bigger and better boats and weapons.
The US, the UK and other countries have about a dozen military vessels patrolling the area as part of the anti-terrorist Djibouti-based coalition Combined Task Force 150. But the conditions off of Africa have deteriorated so quickly that last month the United Nations Security Council adopted Resolution 1838 to fight piracy off the coast of Somalia. Unless protection can be guaranteed, serious international think tanks like the UK’s Chatham House warn that not only will insurance premiums skyrocket, but some vessel owners may look to take longer, more expensive routes to avoid the hunting grounds of pirates, both spiking the price of crude supply. Not to mention the real nightmare possibility of the scuttling or running aground of a supertanker resulting in a major environmental disaster.
Saudi Aramco, like other Middle East oil producers (such as Abu Dhabi National Oil, Kuwait Petroleum, and National Iranian Oil), has hardened its production and refining infrastructure to protect its industry from the threat of Islamic terrorism. Now, facing a rise in terrorism of the old fashioned kind — pirates looking for booty — producers will need to harden their transportation routes in increasingly dangerous waters. And that means higher costs for consumers worldwide.
It seems so. After a number of years of being praised as an alternative to gasoline for our trucks and cars, just about everyone has come to the conclusion that the corn-based fuel, ethanol, isn’t going to deliver us from further damaging the Earth’s atmosphere, help stop global warming, end our dependence on foreign oil, raise farmers’ incomes, and create new jobs.
The US is the world’s largest producer of corn-based ethanol. Corn ethanol, as it has been produced and added to our gasoline by government fiat, has instead led to ill-managed crop farming, rising food costs, food shortages, and the bankruptcy of at least one US ethanol manufacturer.
Who, exactly, is just about everyone? Let us consult an instructive but by no means complete list:
- US Farmers, who planted more acreage in corn at the expense of other food crops like soy and wheat. They sold much of the corn crop to ethanol producers at high prices and are now stymied by recent falling prices. As the demand for corn continues, they plant only corn, thus lowering yields because they no longer rotate crops.
- The nation’s food and beverage manufacturers, including Kraft Foods, Dean Foods, H. J. Heinz, Kellogg, Nestlé USA, PepsiCo, and Coca-Cola, who have seen the cost of their corn-based food ingredients skyrocket.
- US cattle ranchers and pork and chicken producers, who see the prices of animal feed continue to rise, a cost they pass on to the consumer. In addition, due to higher feed costs, meat producers have had to reduce the size of their corn-fed herds and flocks, which means less meat, which means even higher meat prices.
- You and me at the supermarket, paying a whole lot more for our food.
- Hungry people in poor countries (and their governments) who purchase part of the heretofore abundant US grain crops to supplement their own food output. The US no longer has much extra corn to sell; nor oil, nor grain crops.
- Biofuel producers who, as a result of rising corn prices (their raw material), have been struggling to make a profit off of ethanol (like agricultural giant, Archer Daniels Midland, the country’s largest ethanol maker, which announced that for the quarter that ended September 30, operating profit at its corn-processing unit fell by more than half as a result of higher corn prices and energy costs).
- Dedicated ethanol companies forced to declare bankruptcy protection like Vera Sun, or shut down entirely, as Heartland Ethanol did in June of this year. (There go the new jobs.)
It seems the only folks who haven’t seen the mustard dripping on their shoes as a result of this ill-fated corndog of a “solution” to energy problems is the US government, which continues to be a loyal cheerleader for ethanol. In fact, it does more than cheerlead. It mandates. In 2007 Congress passed a law calling for a fivefold increase in the use of biofuel (which is blended into our gasoline) by 2020. And the EPA has so far refused to lower the Congressional mandates, despite the growing concerns about the ripple effects.
Our government seems never to have considered this fact, published by Time magazine in April of this year: A human being could be fed for one year on the corn needed to fill an ethanol-fueled SUV.
Senator Barack Obama, Democrat of Illinois, will become the 44th president of the United States January 20, 2009. His inauguration will be historic, as we all know well. Taking the oath of office may be the easiest task he faces in the four years ahead.
The most tech-savvy president in history, Obama will deal with a lot of demands from the technology industry. The FCC’s vote this week to allow unlicensed use of the “white spaces” TV frequencies is just the start of things. Silicon Valley will be pushing hard on the issues of H-1B visas, Net neutrality, R&D tax credits, and other topics close to its heart once Obama and the 111th Congress (with its larger Democratic majorities) take office. Lobbying firms in Washington are loading up on people long associated with the Democrats to reflect the political realities of the next two years.
Famous as a BlackBerry user, Obama ran a campaign that used social media networks like Facebook to great advantage in wending his way to victory in the primaries and the general election. The senator can only look good in comparison with his Republican opponent, who doesn’t use e-mail, the Internet, or computers in general, and with his predecessor in the Oval Office, notorious for his searches on “the Google.”
Unlike President Bush (at least for most of his term in office), Obama and Senator John McCain both acknowledged the issue of global warming. The presidential candidates differed on their approaches to energy policy, but both paid lip service to the growing use of alternative energy sources. Obama sees clean tech as a way to rejuvenate the US automotive industry, reduce our dependence on foreign oil sources, and innovate our way out of the present recession. That’s a tall order to fill, and won’t be achieved in one or even two presidential terms.
To say President Obama faces challenges is a significant understatement. He will deal with a debt-ridden, moribund economy, along with the biggest annual deficit and national debt our nation has known. Nearly half of the country’s voters think he’s a radical socialist who’s going to raise everyone’s taxes and increase the size of the federal government. Military contractors wonder whether the Pentagon will see sizeable cutbacks in spending, although history shows that Democratic administrations traditionally haven’t stinted on the defense budget. Wall Street and the financial services industry in general will genuflect before Congress and the new Treasury Secretary, ready to publicly accept whatever new regulation is in store, while privately grumbling about who should run against President Obama in 2012. A new economic stimulus package will be a top priority.
What will President Obama tell us on January 20? It will likely be a 21st century updating of “The only thing we have to fear is fear itself.”
Fish is a healthful food and we should eat more of it. With apologies to Mrs. Paul, one tires of fish sticks (hopefully by fifth grade) and (sorry, Charlie) tuna-salad sandwiches can be an odoriferous embarrassment in the old brown bag.
All grown up now and wanting to expand one’s eating horizons, as well as improve one’s diet, one discovers salmon. Not that ghastly sticky stuff that comes in cans. No, the real thing: fresh salmon, deep pinky-red with gleaming silvery skin, nestled in a bed of crushed ice in the fish case at the local emporium.
There are two sources for those thick-cut fish steaks you intend to sear on the barbecue tonight. There are wild salmon and farm-raised salmon. There is also the nebulous category of organic salmon.
But back to the fish case, where the spectre of PCBs and other contaminants cause you a queasy, pre-piscatorial-purchase pause. The tree hugger in you knows that organic is the best choice health-wise. But unlike beef and chicken and other land-based animals that are sold under the organic label, there are no USDA rules or regulations governing the production and sale or even a definition of organic salmon.
The problem with calling salmon organic arises right off the bat with what they feed on. In order to be labeled organic, meat and poultry producers must use no chemical pesticides or fertilizers in the animals’ feed, and use no of hormones or antibiotics on the fish itself. Salmon are carnivores. Wild salmon eat other fish. No control there. Farmed salmon are given fishmeal, which is produced from wild fish stocks. Still no control.
However, this hasn’t stopped the fishing industry from trying to label salmon. Some producers say their fish are “natural.” One hopes they are using some sort of stringent farming methods in order to offer consumers a healthier product. This is not an official “certified organic” label, mind you. There is no such label. Fish farmers are betting on (and abetting) consumer confusion.
Have I mentioned money? There are big bucks to be made in salmon production — and considerably more of it if the fish one sells can command top prices. An official USDA organic certification and the cachet that comes with it would allow over-the-top pricing.
Alaska is the nexus of the US salmon industry. And Alaska’s senior senator, Ted “Bridge to Nowhere” Stevens, has tried mightily to have wild salmon automatically certified organic. But the Republican senator is in deeply polluted waters himself these days, being on trial as he is for corruption, some of it involving, (“Holy Salmon Steaks, Batman!”), the Alaskan fishing industry.
Here’s the thing, Sen. Stevens et al., wild salmon, though it is an excellent dining choice, is unlikely to ever qualify for the organic label because wild salmon themselves (and for that matter, farm-raised salmon) are not raised in controlled, and therefore certifiable, environments.