Wednesday, January 23, 2008

Today the Financial Times has a little piece mentioning the gloating in the halls of Brussels over current U.S. financial controversies, with one Eurocrat after another preening that the U.S. adopted reckless policies, didn’t pay heed to Europe – and it’s projected 1.5-1.8% growth, by the way – and has only itself to blame.  FT pompously passed along the call to “wake up, America!.

OK, so let’s pay attention to Europe.

* Yesterday, the European Confederation of Iron and Steel Industries pleaded with the Commission to stop the hemorrhaging from their carbon-cap-n-trade scheme which put their industry at a big competitive disadvantage compared to Chinese, Russian and U.S.

* The day before that, the European Roundtable of Industrialists begged the Commission for the same thing, saying it could destroy the competitive position of European industry.  The letter was signed by the CEO of Royal Dutch Shell, which had pushed the scheme.

These policies were put in place at the behest of businesses convinced that they can ride the back of the tiger of energy rationing policies and not end up on the inside; certain that if their political buddies impose a system it will be the one they design with plans to profit from – on ratepayers’ and consumers’ backs – and maintain control of.

• As a result of just three years of this experiment, yesterday the President of the European Council, Barosso, vowed to impose trade sanctions on countries that haven’t adopted Europe’s rationing scheme – in which I’ve documented they’re cheating, by the way – which is the most direct way you will ever hear them admit that the scheme is doing precisely as we warned, and killing their economy.
• Remember this when you hear it sold domestically as creating “green collar jobs”: nonsense–some brokerages have done real well, and utilities and some oil companies have been given windfall profits in the trillions, at the cost of chasing real jobs away due to high energy costs.  They have even driven steel jobs HERE.

By coincidence, also this week Greenwire (password required) reported that former RNC chief Ken Mehlman is being paid by rent-seeking industry to convince the administration to adopt this scheme, as are the spinner Tucker Eskew and other former Bushies.

A Bloomberg story yesterday cited Mehlman’s firm, Akin Gump, as an example of lawyers getting $700 an hour to advocate just such things.

Finally, this week, we are also told by our few friends in the White House that there is a new urgency because the long running campaign to get the President to do this is gaining traction, this campaign that is still driven by the Goldman Sachs contingent, which is still driven by Josh Bolten with a little help from Treasury, et al. (Goldman being heavily invested in the project and in on the game since the early days when it teamed up with Enron on it).

We’re told they’ve got a pending recommendation to announce this in the President's State of the Union address.  As Cyrano said about a fiscally reckless move characterized as stupid: “But what a gesture!”