Tuesday, May 24, 2005

No Pain, No Gain

Enviro-warriors are making some headway after what might otherwise be called a slow start. The Kyoto Protocol is now the global economic constitution. It reached it's threshold of 141 nations when the Russians signed on. These nations embrace a virtual freeze on economic development, ending their population's hope for economic justice. It's projected that world GDP will exceed $60 trillion by 2030. The laws of physics tell us that low cost energy consumption will be the measure of a nation's ability to grow it's industries and services. So how can Kyoto do anything other than sentence the poor of the world to a life of poverty and daily struggle?

There was a time when it was expected that Japan would grow with the United States in job creation and economic production. But then enviro-extremists slowed energy use in the name of environmental protections. Today Japan's economy is lower than it was in 1990. That's 15 years of stagnation while energy consumption has been reduced. In fact, as many as 100 million Japanese unplug every appliance after they use it so that it doesn't absorb residue electricity. That's hundreds of billions of plug ins and outs to save energy equal to a 200 megawatt powerplant annually. The fact that it saves less than a fraction of 1% of power consumption seems to escape the enviro-culture.

The US economy produced a little more than Japan in 1990. Today we produce 3 times more, near $12 trillion in GDP. In fact, by 2030, the US is expected to produce over $40 trillion in economic activity out of about $60 trillion. That's more than 2/3 of the worlds products and services. Further we will be responsible for another 5% or more of other nation's production through our investments. Better yet, almost all of the world's savings will be invested here because the money gets a good return, or profit. How can France's or Germany's economy pay investors when they are slipping backwards?

Why will the US economy keep growing while other nations will stagnate or reduce in size? It's because they have signed onto Kyoto and the US has not. China and India are signatories, but are exempt. So they will generate most of the non-US economic growth over the next quarter century. And by then, that's 2030, the US will have developed energy efficiencies that will allow China and India to continue robust growth even if they toe the Kyoto global enviro-constitution line.





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