Branching Out

Exxon is getting into the lithium-producing business. From a report in the Wall Street Journal by Benoît Morenne and Collin Eaton:

Exxon Mobil is bracing for a future far less dependent on gasoline by drilling for something other than oil: lithium.

The Texas oil giant recently purchased drilling rights to a sizable chunk of Arkansas land from which it aims to produce the mineral, a key ingredient in batteries for electric cars, cellphones and laptops, according to people familiar with the matter.

Lithium is far removed from the fossil-fuel business, which has powered Exxon’s profits for more than a century, and signals the company’s assessment that demand for internal combustion engines could soon peak, the people said. It would also mark a return for the company to an industry it helped pioneer almost 50 years ago.

Exxon bought 120,000 gross acres in the Smackover formation of southern Arkansas from an exploration company called Galvanic Energy, according to some of the people. The price tag was more than $100 million, people familiar with the matter said, a relatively small transaction for a company of Exxon’s size.

This is good news. More EVs doesn’t make a great deal of sense if we’re importing batteries and/or the stuff needed to make them from countries that emit lots of carbon in the process. I expect more of these diversifications.

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Their Own Facts

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.

Sounds like our own time, doesn’t it, rather than two centuries ago? The title of this post, of course, doesn’t come from A Tale of Two Cities but from Pat Moynihan’s famous wisecrack: “Everyone is entitled to their own opinion, but not their own facts.” Except today, of course, there’s such a deluge of information that everybody does, indeed, have their own facts.

That’s one of the things that leapt out at me when listening to the talking heads programs this morning in the commentary about the debt limit. The Republicans said that the House had produced the one and only proposal to raise the debt limit. That is true as far as it goes. The Democrats said

  1. President Biden published his budget back in March
  2. What good would it be for the Senate to produce its own bill? The House would just reject it anyway.

The first of those assertions is also true as far as it goes. The second is an opinion rather than a fact. The problem is that’s the way our system is supposed to work: the House passes a spending bill, the Senate proposes its spending bill, there’s a reconciliation process, the president signs the resulting compromise, and the spending bill becomes law. Pretty much Schoolhouse Rock.

Something else the Democrats have said which is true as far as it goes: McCarthy is in a weak position. What so far has remained unsaid: Schumer is in a weak position, too.

The debt limit isn’t the only subject on which everybody has their own facts. Yesterday a commenter lamented:

You can apply this statement to almost everything in the “news” today: Patriot missiles, Durham Report, FBI collusion with dems, COVID statistics, climate change predictions and fears, the circumstances surrounding the J6 protests and illegal surveillance by the FBI, Norstream sabotage, the 2020 & 2022 election malfeasance, the current debt ceiling Dem/Republican debate, for starters.

to which we might add the Battle of Bakhmut. Has Bakhmut fallen or not? It depends entirely on who you listen to and, echoing President Clinton, how the meaning of “fallen” falls.

I’ll go on the record with my opinion about each of these. Note that these are just opinions—I wouldn’t elevate them to the level of facts.

  • I don’t think the Patriot missile has shone in Ukraine. I think it may have reduced the damage of some Russian attacks but a lot of Patriot missiles have been expended in the process and/or lost. And they’re expensive.
  • There was no “smoking gun” in the Durham Report but it did support the claim that the FBI needs reform.
  • The greatest likelihood is that Poland and Ukraine sabotaged the Nordstream pipeline, Seymour Hersch notwithstanding.
  • I think that anthropogenic climate change is a risk but not an issue, i.e. it hasn’t already happened but it may. There is no workable solution that doesn’t involve fewer imports from China (and India), more nuclear power, and CCS.
  • The breaching of the Capitol on January 6, 2020 was unacceptable. Some of the participants may have thought of it as an insurrection but most didn’t. Keeping it in the news has helped Democrats.
  • “Ballot harvesting” is a problem; voting machines do not appear to be. Joe Biden was elected president in 2020. There was no “red wave” in 2022 because Republicans screwed up and Trump was a big part of that.

I want to close this post with one more thought. Josh Billings was right: “I honestly beleave it iz better tew know nothing than two know what ain’t so”. That was true 250 years ago and it’s just as true now. With the sheer volume of information not to mention large language model “artificial intelligence” and deepfakes telling true from false is harder than ever but that doesn’t make ideologically-based reasoning more effective or make discerning the truth less necessary.

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The Parvificent Seven

Country Leader Approval 
Canada Trudeau  39%
France Macron 25%
Germany Scholz 34%
Italy Meloni 49%
Japan Kishida 31%
United Kingdom  Sunak 33%
United States Biden 41%

All of the approval ratings above are from the Morning Consult (for consistency). I don’t know that there’s ever been a weaker showing among the G7 leaders.

In a sense just attending a summit probably helped them—looking statesmanlike is always good.

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Defeating Ourselves

I don’t know that it would be possible for me to disagree with Con Coughlin’s column in the Telegraph, repeated here at MSN, more. His thesis is that

  • China is a threat
  • China is preparing for war
  • “We” in the West are preparing to surrender

I don’t believe that any of those is true.

Quite to the contrary I think we—the United States—are our own biggest threat, that there is a risk of China’s being big, strong, and aggressive enough to threaten us, and that we’re responding by continuing to dismantle our own industrial infrastructure, import more of what we consume from China, redefining consumption as investment, and bickering among ourselves about matters that can only puzzle most of the world.

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What You Can’t Decide

I’m not even going to bother to read Eugene Robinson’s latest Washington Post column. Here’s its title: “We can’t unmake nuclear weapons. But we can decide never to use them”. True enough. We might make such a decision. What we can’t decide is that they will never be used against us. That’s why making the decision never to use them is imprudent.

The case is similar with respect to artificial intelligence with one exception. Not only are we unable to decide not to have it used against it, we are unable to prevent its being developed.

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Reconciling Opposites

I found these two pieces provided an interesting counterpoint. In the Wall Street Journal James Freeman reads the description of one of the posts incoming Chicago Mayor Brandon Johnson just created via executive order:

The Deputy Mayor for Labor Relations is responsible for working with all City agencies and departments to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of Chicago; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights, including working with relevant authorities to help enforce workers’ statutory rights.

and, quoting from the Trib:

That’s a gift-wrapped present for the [Chicago Teachers Union], which probably had a big hand in its composition. It says nothing whatsoever about any obligation to protect taxpayers, homeowners, businesses or, frankly, even the democratic process. It basically says: Do what unionized workers want, find more ways to give them more of what they want, and your annual review will be just dandy. Any private sector manager, or even a private sector union leader, closely reading that language, would be shaking their head in amazement.

In fact, if you take that job description at face value, any deputy mayor pushing back on any union demand whatsoever would, in fact, be contravening what their boss says is the requirement of the job. If a union asks for something that it says “advances opportunities for profitable employment,” then the deputy mayor’s job is to immediately give it to them and think up more stuff, too. If the deputy mayor were to say, for example, we can handle a 5% raise but not 25%, such a statement would contravene their very job description.

declaims:

This gift to the Chicago Teachers Union is appalling but perhaps not surprising to Journal readers.

The other piece is a post by Bryce Hill at RealClearPolicy:

The new poll from Echelon Insights in partnership with the Illinois Policy Institute shows Illinoisans prefer pension reform 3-to-1 over tax hikes and service cuts.

Here’s the exact wording of the question: “When it comes to public-sector pensions for government workers, which of these statements do you agree with more, even if neither is exactly right? Illinois should …”

  • Amend the State Constitution to preserve retirement benefits already earned by public employees and retirees, but also allow a reduction in the benefits earned in the future by employees and allow for slower growth in retirees’ future benefits.
  • Raise taxes or reduce state spending on higher education, public safety, and social services to fully fund the state’s pension obligations to government workers.

Fifty-six percent of respondents supported the pension reform position, compared with just 18% of respondents who supported tax hikes and service cuts.

With respect to Mr. Freeman’s point I believe that any thinking person knew that before Mayor Johnson was elected. It was obvious. No executive order was needed to make the determination.

With respect to the second although I think the poll’s question is a little cooked (for one thing they should have separated raising taxes from cutting services), I completely agree that public pension reform in Illinois is a dire necessity made all the more urgent by higher inflation than has been seen in decades—cost of living increments are baked into public pensions and have the force of law. It certainly isn’t surprising: Illinois voters already rejected a graduated state income tax. And we already pay among the highest taxes in the country. The reforms that should be implemented are legion including:

  • We should transition from a guaranteed benefits plan to a guaranteed contribution plan. We should have done that a decade ago.
  • School districts should be required for pay a larger proportion of retired teachers’ pensions. Ideally, all of it.
  • The practice of “goosing” teacher pay for the last couple of years before retirement should be forbidden by law
  • Either Chicago teachers should be rolled into the same plan as other Illinois school districts’ retirees or Chicago citizens should be exempted from the part of state taxes used to pay the retirements of non-Chicago retired teachers or the city should be reimbursed by the amount that Chicago overpays. The present situation is unjust.

I also think that the wages of public employees must be kept in line with the incomes of the communities they serve but that’s a slightly different subject.

But my main point is that I don’t see any straightforward way of reconciling Mayor Johnson’s goals. We’ll have an interesting test case soon. Although the Chicago Teachers Union just negotiated its contract the Chicago Federation of Police has not. The FOP didn’t support Johnson’s mayoral campaign and, as I have reported here, public safety is a key concern of Chicagoans. Although I’m not naive enough to believe there’s a straight line connection between the FOP and public safety, they’re not completely unrelated either. I think there’s a straight line relationship between the uptick in crime and decreasing number of arrests.

There’s a conflict among public safety, defunding the police, and the limits how much revenue can be extracted. I’m reminded of the faux Chinese curse: may you live in interesting times.

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Supplying Ukraine

While I’m on the subject this piece by Loren Thompson at Forbes caught my attention:

The dual stresses of conflict in Ukraine and potential conflict in Taiwan have forced a wholesale reevaluation of how the U.S. government purchases munitions and other materiel, with an eye to accelerating every facet of the process.

The urgency of military needs has merged with the Biden administration’s efforts to craft a national industrial policy, and the bureaucratic result is akin to when frozen regions begin to thaw with the coming of spring.

At this point the U. S. isn’t able to supply arms to Ukraine at the pace at which the country needs them. Will we able to supply both Taiwan and Ukraine at the same time?

As should be obvious Russia’s war with Ukraine is a European war but other than the United Kingdom, Netherlands, and countries that share borders with Russia you would hardly know it. Consider:
Statistic: Total bilateral aid commitments to Ukraine as a percentage of donor gross domestic product (GDP) between January 24, 2022 and February 24, 2023, by country | Statista
Find more statistics at Statista
When considered in absolute terms the situation is even more stark: the U. S. is supplying more aid to Ukraine than all other countries combined.

Here’s a question the significance of which shouldn’t be lost on any of the interested parties: given a choice between Ukraine and Taiwan, which is our higher priority? I think it’s Taiwan.

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Europe’s Conundrum

Here’s an interesting quote from scholar Stefan Auer in an interview at Chatham House:

I am seriously concerned by the growing gap between the EU’s capabilities and expectations. We are being told Ukrainians are fighting and dying for Europe, for the EU, so Ukraine must become a member of the EU. But the more I research, the more sceptical I become about the viability of that proposal.

Even before the war started, Ukraine did not measure up to expectations on the quality of governance needed for EU membership. So if the EU pursues its normal procedures in terms of enlargement there is no way Ukraine will become a full EU member within the next 10-20 years. But geopolitically Ukraine must become a member, so the EU must change to make that possible.

Another problem is that, from the perspectives of Germany and France, the EU needs to integrate further before enlargement can proceed, but there is no support for that. Poland does not support it and I do not think there would be much support for it in Ukraine either. When you examine Ukrainian debates about national sovereignty or the nature of their fight, yes they fight for Europe but they fight for Ukrainian independence. So, to imagine the Ukrainian preference would be for a ‘United States of Europe’ is utterly misguided.

Does NATO membership for Ukraine face similar obstacles?

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The Loser

At Project Syndicate Joschka Fischer, probably more responsible for Europe’s sorry state than any other living individual, declaims that Europe will be the biggest loser from many of the situations unfolding today and it has no choice but to reassert itself as a “real power”:

But the broader danger for the international system stems not from the war in Ukraine (Russia is too weak to pose a truly global threat), but from the deterioration of US-China relations. True, notwithstanding China’s bellicose rhetoric over Taiwan and its aggressive naval exercises in the waters around the island, the confrontation so far is less military than economic, technological, and political. But that is cold comfort, because it is an intensifying zero-sum conflict.

Some of the biggest losers in this confrontation are likely to be Japan and Europe. Chinese firms have built massive production capacities in the automobile industry – especially in electric vehicles (EVs) – and are now poised to outcompete the European and Japanese automakers that have long been globally dominant.

Making matters worse, America’s own response to Chinese competition is to pursue an industrial policy that will come at European and Japanese manufacturers’ expense. Recent legislation such as the Inflation Reduction Act, for example, provides large subsidies for cars produced in the US. From the US perspective, such policies kill two birds with one stone: protecting large domestic manufacturers and providing them with incentives to pursue EV development.

The eventual outcome will be a thorough reorganization of the global auto industry, with Japan and Europe (primarily Germany) losing competitiveness and market share. And lest we forget, this major economic development represents merely the beginning of a much larger global confrontation and strategic reordering.

Not only must Europe take great pains to preserve its economic model during this reorganization of the global economy. It also must manage high energy costs, the growing digital technology gap vis-à-vis the two superpowers, and the urgent need for increased defense spending to counter the new threat from Russia. All these priorities will grow even more urgent as the next US presidential election approaches, given the distinct possibility that Donald Trump could return to the White House.

Europe thus finds itself especially disadvantaged. It resides in an increasingly dangerous region, yet it remains a confederation of sovereign nation-states that have never mustered the will to achieve true integration – even after two world wars and the decades-long Cold War. In a world dominated by large states with growing military budgets, Europe still is not a real power.

When Germany was profiting by its “factory in a box” trade with China, there was no threat. Now that Germany is running a trade deficit with China, it’s a threat. Furthermore, he’s a pacifist who encourages intervention.

As in the United States European military power and global influence are downstream from economic power. I don’t see how Europe preserves its economic model, reduces its reliance on fossil fuels, eschews nuclear power, and reindustrializes all at the same time.

Mit Verlaub, Herr Fischer, Sie sind ein Arschloch.

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Partisan Bickering

I’m finding the discussions in the blogosphere and the opinion pieces in the media pretty discouraging. They’re almost entirely partisan bickering. Individuals on different sides look at the same events and see drastically different things. It’s true of practically every story.

What I think that both Democrats and Republicans are missing is that practically all elected officials are corrupt and the longer they have been in office and the higher the office the worse they are. They have compromised their principles so thoroughly they don’t have any.

Some see that and assert that if only their guys got in things would be different. That’s wishful thinking. They won’t be any different.

Some say that’s proof positive of how useless government is. Sadly, there are some things that desperately need doing that markets and individual initiative won’t accomplish. As bad as it is, we need the government.

So we’re down to bickering.

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