OP Rana

Chronicle of the coming year foretold

By Op Rana (China Daily)
Updated: 2011-01-01 07:49

The year to which we bid goodbye just hours ago will be remembered for more things bad than good. But let those of us who look forward to the proverbial silver lining in the dark clouds of last year to herald a more rosy beginning to the new be forewarned.

To begin with, (since today's world is obsessed with the economics of money), the world economy looked promising at the beginning of this year, too, after signs of global recovery at the end of 2009. But that was followed by shocks, not respite. Not many jobs were created in most parts of the globe, including the United States (though application for jobless benefits fell last week). The US housing market fell again after some recovery. Consumer markets were unstable, made worse in developed countries by winter snow and blizzards. The sovereign debt crisis wreaked havoc in Greece and Ireland, and threatened to spread to Spain, Portugal and other European Union countries. The EU policy shifted radically from generous stimulus package to extreme austerity, dampening recovery prospects further

The world economy, in fact, was in a state of uncertainty. Policymakers and economists kept running from one end to the other - taking measures to combat inflation one moment, and devising plans to fight deflation the other. Even the US Federal Reserve seemed to have run out of ideas.

But away from public spotlight, oil companies were sharpening their knives as crude prices inched toward $100 a barrel. Earlier this week, crude prices crossed $94 a barrel, the highest in 26 months. And most analysts agree that dropping stockpiles (by 2.9 million barrels) along with the "improving economy" will force oil prices to cross $100 a barrel in 2011. That will be the gift of economic recovery. If it's dj vu all over again, it is supposed to be that way - the ghost of 2008 still haunts us.

The only silver lining, and there seems to be just one, are some Asian economies, particularly China and India. They are still going strong on the economic front but struggling to check inflation - if housing and food prices have gone up in China, then prices of almost everything have risen in India.

Apart from oil prices, another development has failed to attract as much public attention as it should have. The Barack Obama administration has refused to classify polar bears as "endangered" species, which would have required the US department of interior to assess the impact of greenhouse gases (GHGs) on their Arctic homeland. Instead, it has classified polar bears as "threatened", a status that gives them less protection under US law.

This may not seem a big issue at first. But considering that analysts say oil stocks will drop, the polar bear's Arctic homeland acquires added importance. The US government is considering issuing permits for oil exploration and exploitation in northern Alaska, which is part of the Arctic. It, however, cannot do so without fierce opposition if the polar bear is declared an endangered species, because then it would have to include GHG emissions in its decision.

Obama, despite his promises to the contrary, continues to defend his predecessor George W Bush's "anti-science decisions". But that should not be surprising. After all, most of the world is influenced by the whims and fancies of greedy multinationals and their eager-to-please mainstream economists rather than "pro-human, pro-science" decisions.

To be fair to the Obama administration, it has promised to regulate GHG emissions from power plants despite opposition from industrial lobbies and Republicans. The Environmental Protection Agency (EPA) has said it would propose figures for GHG emission cuts in 2011 and finalize them next year. But with industry and Republicans (who now hold majority in Congress) opposing the move, the result is anyone's guess, especially because they say EPA's "new rules" will harm the economy.

Polar bears despite their importance in the long and winding biodiversity cycle, however, are not the central issue. The polar bear is important because it is the most well-known Arctic animal and almost synonymous with the Arctic ice sheet. With the protection of the largest land carnivore pushed aside, the Arctic will be open to rampant exploitation. The more ice sheets and glaciers vanish, the better for oil companies.

The only problem is that melting Arctic ice will raise sea levels, intensify global warming and cause more pain and suffering to people in poor countries. The world already has more than 1 billion hungry people. And failing crops, because of climate change, will add to that number. But why should the multinationals and oil companies worry about that?

The author is a senior editor for China Daily. He can be reached at oprana@hotmail.com.

(China Daily 01/01/2011 page4)