Environment

With a slowing economy, escalating food prices and energy prices climbing ever higher, you might think that Republican presidential candidate John McCain would be hesitant to endorse a European Union-style carbon emission trading scheme that seems likely to result in less economic growth, higher energy prices and higher food prices from increased biofuel demand. But that’s because you don’t know him as well as his daughter, Meghan McCain, who says he’s totally freaking out over global warming.
“My dad was tortured in prison; he doesn’t overreact to things. So if he starts freaking out, you know it’s time to freak out,” the blonde, blogging McCain told the editors of GQ in a profile last month. “And I think he’s freaking out about the environment. He’s like, ‘I’m genuinely worried about climate change; it’s happening right now.’ ”
Today in Oregon, McCain—the former POW—announced his support for a “cap-and-trade” program for carbon emissions. Under “cap-and-trade” programs the government rations the right to emit certain pollutants and allows companies to sell unused portions of their ration or buy up excess rights from others.
The endorsement is meant to win over centrist voters who have been convinced that global warming results from man-made pollution. It is likely to be criticized by the right—which views going to Oregon to endorse environmentalist measures like Jane Fonda going to Hanoi to decry the Vietnam War (Oregon John, anyone?)—and the extreme greens, where carbon trading is seen as conceding a right to pollute. Energy traders, who largely see the credits as another commodity to trade, will likely welcome the plan.
McCain also promised to bring pressure on China and India to convince them to reduce their emissions.
China responded this morning by holding an earthquake. (“Pow! Take that, Earth!”) India said it would gladly allow US companies to outsource their own carbon reductions in exchange for improving India’s environment. Vietnam responded by offering to sell rice to the Philippines at shockingly high prices.
McCain Woos Democrats on Environment [Wall Street Journal]

Long Green, Short Red, White and Blue

Tim Carney, who specializes in showing how businesses use government as a mechanism to secure profit, takes a look at former Tiger Management fund manager Julian Robertson’s environmentalism. Turns out he stands to make a bundle from costly alternative energy sources as well as an economic downturn brought about by higher energy costs.
Nice work if you can get it.

A bigger Robertson bet, presenting a more insidious angle, is his short position on 10-year Treasury bonds paired with a long position on two-year Treasuries. Basically, if the U.S. economy is fundamentally unsound, Robertson gets rich. “I’ve made a big bet on it,” Robertson told Fortune. “I really think I’m going to make 20 or 30 times on my money.”
Robertson sees lots of reasons for an impending downturn, but severe restrictions on coal and petroleum use would help along a recession. A study released last week by the National Association of Manufacturers reports that leading climate change bill S2191 (which Akin Gump is now pushing) would, in the year 2030, cost the gross domestic product at least $631 billion, cost 4 million jobs, reduce household incomes at least $4,000, double electricity prices and nearly double gasoline prices.
Such a report, funded, albeit, by a trade group opposing the legislation, highlights both the down sides of climate-change legislation and a possible up side to the legislation for a man betting against the U.S. economy.


Going short on America, long on Gore agenda
[Washington Examiner]

[Full disclosure: Tim Carney is closely related to one of DealBreaker's editors.]

Good Clean Fun – Green Tech Adverts

Epuron, a German green tech company, won the Golden Lion for best advertising spot at the International Advertising Festival in Cannes (the Palme d’Or of adverts?). Not to spoil it, here’s the spot, created by Nordpol+ Hamburg (see how early you can catch on before the punchline):

Contrast this with the “Say Hey” BP ads, that try a little too hard to reinforce the fact that giant oil companies are eco-friendly in that “when I drive up to a gas station I open up my mouth so that the gas nozzle can rain golden helios on me while whistling a catchy tune” sort of way.
Epuron is a subsidiary of the European renewable energy company Conergy, and specializes in photovoltaics, wind and bioenergy.
“Power of Wind” from EPURON wins Golden Lion in Cannes [Epuron]