Sunday, March 27, 2011

Shepard Fairey VS MIC

I've been taking public transport, and yes I have to say it is as bad as they say it is. Even in the eastern suburbs. But that's not what I want to bitch about today. Looking from the 109 tram windows as you leave the North Richmond station end of Victoria St heading up to Saint V's, Smith St, Brunswick St etc. somebody had plastered a section of some wall with Shepard Fairey's Andre the Giant posters. Walking down Swanston St I saw them again outside Crossroads or some other restaurant. Near the skate shop.
I'm fairly certain, but not completely certain I have seen them from the train line plastered on fences and concrete walls that back onto the tracks.

I mean I'm not really surprised, offended, or impressed by them. What makes an impression is that they seem to have appeared recently.

As in, it's 2011.

Why is anyone putting up Andre the Giant 'Obey' posters in 2011?

Shepard Fairey created the Obama 'Hope' poster for Obama's 2008 campaign, shortly afterwards it was widespread and imitated. Fairey was not exactly unknown to people 'in the know' before the Hope poster.

So what is the fucking point of putting up his now well known 'Obey' posters on the streets of Melbourne.

It just doesn't make sense to me. Why would somebody in Melbourne go out at night, spot locations and risk paltry fines to stick up somebody else's art that is already well known? It just doesn't make sense.

It only just occured to me in the writing of this, that it may be just 'viral marketing' by whoever owns the distribution rights to Shepard Fairey's Apparel, and they are trying to create brand recognition, and also treat their consumers post purchase cognitive dissonance by convincing them that their apparel is cutting edge underground street art.

But that kind of ruins my hypothesis and gripe. My hypothesis was that somebody actually thinks it is a cool idea to print out Shepard Fairy poster's on mass and glue them up in primo locations around Melbourne. That this person somehow thinks they are enriching the underground art scene by doing so.

This is the full extent to which I would ever concede they have a point: My art teacher in high school Vicky, on her first class with me informed myself (and every other student) that the art by students had been taken down and replaced with good art because we needed a certain quality of art to inspire us and make us strive to achieve more. Shepard Fairy certainly is a good artist, his work deserves to be displayed somewhere.

But consider MIC. If you live in my town you know his work. This is his work:

Indeed when I first learned the artist's Moniker I remember reading that you really need to travel all of Melbourne's trainlines to appreciate how extensive and prolific his work is. You can see his faces on the Upfield line, the Glen Waverley Line, at St Kilda Junction, the Epping Line, The Belgrave, Lillydale lines, pretty much everywhere you go in Melbourne, you will see MIC's faces somewhere.

I am concerned some idiot will plaster over these individually hand painted local artists' work with a mass printed 'OBEY' poster.

I have written before about the ever increasing fidelity of trends through globalisation. And atrguably that post is more interesting than this one. You can read it here.

So rather than rehashing my explanation of how it works, scalability and stuff I thought I would expand upon my problem with it.

There is something unrespectable about the cringing servility of saying 'Melbourne is a backwater, New York is cool. We should cover Melbourne's streets with images of New York.' Like it is just plain pathetic.

Certainly I buy all my clothes from Dr. Jays and wear african beads. But that's different. Black People are much cooler than white people. Art is something else all together.

MIC and Shepard Fairey are almost opposite ends of the spectrum. MIC is relatively anonymous, he recycles and scavanges all his paints and painting materials and paints each of his faces individually in an almost obsessive compulsive manner. Shepard Fairey is not anonymous, I don't know how he creates his original images, but he then just prints them onto desired medium and then pastes or sticks them up. Each a carbon copy of the next.

The prolific spread of MIC's faces, given that they are all unique is impressive. The prolific spread of Fairey's Andre the Giant 'Obey' stickers is not. Shepard Fairey is a talented artist. But he doesn't need more space, to invade our public spaces like Windsor Smith shoe billboards furthermore, I don't understand why space in Melbourne's heritage listed Graffiti laneways has been dedicated to his posters:

Go see them and appreciate, just how unimpressive they are pasted up next to beautiful unique hand painted murals that sorround them. That visual experience is probably the best counter-argument I could produce. You would realise that you don't need to be in one of these fashion capitals like New York, Paris, London or Tokyo to produce something new and quality. You could be in Chadstone for example and still produce great art.

I have said before, it was no accident that Florence produced Leonardo, Michelangelo, Raphael and Botticelli (and yes, Donatello) it wasn't some random coalescing of the stars. Florence simply decided to support it's local artists, and with that support and public space and funding, it produced at least two of the greatest artists ever to have walked the earth. They two were not immune from globalisation or derivation, the Renaissance was a return in many ways to greek and roman classicism.

What they didn't do was take prestige space like the Plaza where David stood, and fill it with copies of Greek Sculpture. Case in point, Shepard Fairey resides in Los Angeles and was trained in Rhode Island. He wasn't part of the New York street scene in actuality. When you are talking about one of the most reproduced artists coming out of America's smallest state, you may as well believe Melbourne is capable of producing good artists too.

But really the finger has to be squarely pointed at the artists themselves. MIC does his own thing, my concern is with the peeps sticking up the Obey posters. Do you really think you are ever going to achieve your own great work of art, by hanging pictures on walls for other artists. Pick up your paints, your sharpie, your own feces whatever and make something. Quit trying to import a street scene, be the street scene.

Thursday, March 17, 2011

Why We Buy Property

Good news! I dislocated my shoulder which means I can't draw for a while and shall have to return to my lazy love of writing.

I have plans, big plans of writing a letter to my university that will change the very nature of education, and so today I thought I'd write about one section of it as sort of a first draft. There's so many concepts I don't know how they will all fit together yet.

My university like many others has adopted a practical bent, the focus of it's course structure, subjects, assesment etc is all geared towards preparing us for work. 'This is something you can use.' one will often hear of an assignment, a formula, blah blah blah.

I have graduated and worked once, my experience is that the soft skills (communication, reason, curiosity, feedback, time management etc.) are what gave me the biggest practical advantage, the hard skills (multiple linear regression, integrated marketing communication, gap theory of customer service, om's retail gravity law etc.) range between useless to a graduate or easy to learn on the job if they are necessary.

Whilst many institutions competing in a global education market have stressed practice over theory (at least in their marketing materials) I think (and this may be contentious) that having a strong theoretical or philosophical underpinning is actually the most practical thing a student can graduate with.

In simpler language, universities are now emphasising the HOW at the expense of the WHY. For some reason in my first degree many lecturers would seemingly boast that 60% of marketing graduates couldn't supply a definition of 'brand equity' one of the centermost concepts of the marketing field.

I feel in economics and finance, many graduates could not furnish you with a definition of 'investment' nor could many differentiate it from 'speculation', almost none would understand 'rationalization' and few after having sat through the subjects Investment and Risk Management would be able to define risk in non statistical terms.

These four terms alone though depending on a graduates understanding of them would powerfully transform the way they practice. I personally feel that it would be worth spending a semester hammering these four terms into students heads if not integrating them into the governments educational reform to teach financial literacy to children.

To illustrate the effects of such an underlying philosophy of investment I thought I'd look at one of my favorite pet peeves - property.

Straight up is property an investment? Well that depends on what your definition of investment is, if it is something you can spend money on then yes. But that is a broad and sufficiently meaningless definition of investment, by the same definition a sandwich is an investment.

What is an investment? Well an investment is an asset you can buy that will generate some kind of income stream. Thus an investment can be a factory that produces pies, that can be sold and if profitable that 'investment' will eventually pay for itself. It can also be a share in such a factory, these investments are referred to broadly as 'equity' and your share in the business will pay you some dividend from the profits. Or it can be an assett that pays interest or some other fixed income like a bond or debenture. And yes, it can also be property that has an income stream of rent.

So it probably isn't a shocking revelation that property is in fact an investment class. This is uncontroversial, what is controversial is the suggestion that property is only an investment because it generates rent.

There is a broader definition of investment that is fuzzy, that is it is hard to differentiate between a painting as an investment and a sandwich as an investment. It is to say that something can be an investment if you expect a capital gain.

A painting has no income stream. (As opposed to a museum) but may be expected to appreciate in value. These are referred to as 'greater fool' investments, because by purchasing an 'asset' that doesn't generate any income, you are a fool. Your only hope to profit from the purchase is to sell it to a fool who is willing to pay more money for it than you foolishly did. Hence 'greater fool'.

Certainly capital appreciation exists, particularly in property, but when is it as a result of sound investment and when is it a result of greater fool investment?

Enter pricing, enter - Business Finance. Here you learn to price all manner of assets through discounting. For example you can price a bond by discounting it's income streams to net present value. You simply take the Face Value, the coupon rates, the present interest rates (or yield) throw them in a formula and determine the net present value of all future cash flows.

You can do the same (albeit more fuzzily) with Shares. The net present value of a share (the price you should pay) is the discounted value of all future income streams. You can use some constant growth dividend formula to estimate a price for a share.

NOW for some reason with shares we assume rationality amongst purchasers, that is we don't factor in 'Capital Gains' into the constant growth dividend model because we say the price of the share is always determined by the future value of all dividends. That is a share can't appreciate in price without it being a direct reflection of expected growth in future dividends.

This does not however apply to property. I don't know whether to scratch my head at the Finance fields bounded rationality or applaud them for observing what happens in practice - but if you were treating property as an investment then you could determine a price for it based on the discounted value of future income streams - rent.

So you have a property that earns 10,000 rent per year, the interest rate on government bonds gives you the current yeild, you can calculate a fair price to pay for a house based on constant growth in rental income and prevailing interest rates. You can also use a simpler method of price/earnings ratio. That is you take the price of the property and divide it by it's projected (or historical) earnings and you will come up with a ratio that will tell you how long it will take to pay for itself. That is how good an investment it is.

No examples in my, or I suspect any course have ever applied these models to property. Why not?

Enter the importance of understanding speculation. One may assume you could fail constantly in the course by saying things that earn a rebuff from the professor 'that's not investment that's speculation.' Speculation rarely if ever has been mentioned in my course and sadly usually by students.

Being generous speculation is a type of investment, but is not really investment. It's a bad type, highly risky and profoundly irrational. It has more akin to gambling than investing. It is basically disregarding the underlying investment and focusing solely on changes in price.

In the case of property it is expecting prices to increase because they have increased. Most people would know speculation as 'investing for capital gain.' You are just betting on price changes. One can speculate on stocks of course, the internet bubble was an example, people were willing to purchase companies that had Price/Earnings ratios of 600 (this means for every dollar you 'invested' you could expect to be repaid via dividends in 600 years). Phenomenally over priced. People were buying these shares not because they had 600 years to wait for pay dirt or anticipating explosive growth in the companies earnings (though they may have told themselves so) but because they thought that tomorrow somebody would come along and buy that share back off them at 700 times earnings.

Property currently works like this as an investment, that is it is heavily speculative. Few people that own property cannot furnish a reason (that is a rational reason) why their property should appreciate in capital growth. Investing is intrinsically rational. It may not always be correct, and there are certainly good and bad investments because the world is unpredictable. But it is rational, speculation is not. Speculation is blind.

If my lecturers were to start to price property, what would they do? They would probably look at the rents, but they know that this would be a purely theoretical exercise. How could they look at capital gains. They would have to say 'Okay we expect the capital gains to be 10% per year...' WHY? We of course observe this happening 'out there' all the time, which I assume is why my educators have steared clear of touching property with any of our rational, reasonable pricing models.

Certainly 'investors' 'invest' for capital growth when it comes to property. What we want to understand is why would I pay a higher price for your investment than you did? Go on, just fucking try it.

I'm going to try it rationally. That is treat it like an actual investment, so let's look at the rental income. Even if you occupy your own property, there is still rent in the form of savings. The simplest thing to do is look at the rental income stream, typically a regular cash flow that comes in on a monthly basis. Now Net Present Value is the value of ALL future cashflows, so you have to estimate basically an infinite amount of rental income.

This may sound like no price is too high for property, but you are also discounting these infinite cash flows by an infinite number of time periods making such future earnings almost worthless. The time frame compresses, but basically I would need to make some assumptions about the future growth of rent income to put a price on the property.

Now rationally, I know that if I increase rents faster than household income, I am simply going to price myself out of tenants. Just as long term a companies 'constant' dividend growth can't be larger than projected global GDP growth because then we would be anticipating the company to grow larger than the worlds economy - which is by definition impossible.

So logically rents should follow wages. We can be greedy/optimistic and assume that rent will always be some fixed percentage of household wages (eg. 30%) or we can be conservative and assume that household income will grow faster than rents. (Which is reasonable because if rents grow faster, everyone will prefer to buy their own home than rent, a landlord has to provide some value to attract customers).

So all this is so we can price our property, thus logically the price will grow in line with growth in rental income, which will grow in line or follow growth in household incomes.

Who thinks (rationally) like this? Fucking no-one that's who.

We know in practice that over the past 16 or so years, property prices have grown faster than rental income, which in turn has grown faster than household income. The only way this sequence could be rational would be if it were reasonable to anticipate some massively transformative restructuring of the Australian economy resulting in widespread sudden appreciation in household incomes and subsequent rents.

Instead we have negative gearing, that is, you buy a house. You borrow money to do so, you get some tennants. They pay you $170 per week in rent (the prevailing market rate) and you in turn pay $200 to the bank to pay off your mortgage. Which is to say in purely rational terms, some joe is giving you $170 of their wages per week to live in your house. For the priveledge of having them live there you take an additional $30 per week out of your own wages and then take all their rent and pay it to the bank.

I would not be surprised if almost all rents in Australia wound up being paid to the bank. Certainly there are cash flow positive properties (where it pays more to own the property than it costs) and these are indeed 'investment properties' But if there were no hope of somebody paying to take that property off your hands, having a negatively geared property would simply drive you bankrupt.

The equivalent would be owning a business where you had to work a second job just to keep that business afloat. Few people who owned a milk bar would keep it if they had to pay $200 a week just to stay in business. You would sell it off and get out in a heartbeat. But people do the equivalent all the time with properties.

Similarly, even if you are quite wealthy and buy a house outright for say $3 million dollars. And that property earns $24,000 per year in rent ($166 per week for a 3 bedroom home) you have a price earnings ratio of 125. That property will pay for itself in 125 years! By contrast you can buy shares in Google at 21.35 times earnings. (as at today).

As per Peter Schiff said 'you don't invest to break even, Government (US) bonds are yeilding 3-4%, if you can't earn 6-7% on rent then why bother investing.' Few people make more income from rent than they would on an online savings account. Many more through borrowing lose money.

So why do people buy property? For the capital gain. But there is no rational reason for property prices to appreciate. That is the prices don't reflect the actual income generated by the property, just an anticipation of further price rises.

Few people would have the stones to admit that they expect property prices to go up because they have gone up. That is pure irrational momentum, but that is what they do.

Enter rationalization - According to the DSM-IV, rationalization occurs "when the individual deals with emotional conflict or internal or external stressors by concealing the true motivations for his or her own thoughts, actions, or feelings through the elaboration of reassuring or self serving but incorrect explanations."

That is you observe a phenomena - property prices increasing, you then furnish this phenomena with an explanation. The correct one in my belief was that banks loaned more money and people foolishly bid up the price of houses. The prevailing explanation is that Australia's population is growing faster than its supply of housing.

According to the 2006 Census data on the ABS Melbourne had 119,624 dwellings that were unoccupied. This represents 8.1% of the total housing supply of 1,471,154 dwellings. In 2001 Melbourne had 101,251 dwellings unoccupied representing 7.53% of the total housing supply of 1,344,624 dwellings. That means that between 2001 and 2006 (boom years globally) the surplus of housing actually increased. There are more empty houses now than there were before.

By contrast in the same time period the population only grew by 254 thousand people or 7% the supply of dwellings grew by 8%.

Thus the excuse/explanation/rationalization that has been popular for the past 5 years has no empirical justification. It is factually false. Australia has plenty of housing, population growth is not driving the prices, it is not a supply demand situation.

The importance of 'rationalization' to any prospective investor is crucial, in two regards. One the underpinning of almost all economic theory is in people's rational behaviour, rationalization is a topsy turvy kind of rational behaviour that is consistent but incorrect. Reason occurs when you observe an ice cube turn into a puddle, rationalization is observing a puddle and assuming an ice cube is there.

What is crucial is understanding how powerful rationalization is. The Census is the most statistically complete and reliable data available to Australians. It is available to the public for free, including journalists, business commentators, your parents, finincial advisors and government officials and yet its findings are emphatically ignored.

I observe academics that spend full time hours reading journal after journal to keep up to date on their thesis topics spout the same rationalisation of population growing faster than housing supply. I have only looked at Melbourne, but it is an Australia wide trend

How can so many people be so wrong? People who are supposed to be experts on this very subject? The short answer is I don't really know. The longer answer is because rationalization is all pervasive and very powerful.

Every bubble requires a 'new era story' that is an explanation of why things are different 'this time' - these were arguably more credible in the internet boom of the 1990's. The prospect of conducting business electronically, where products traded where software, where you didn't have the need for warehouses anymore and some kid in his garage could concievably take on Microsoft where plausible if improbable. It is hard to disprove something purely hypothetical, particularly with the speed of technological advances in the 1990s. E-business had literally never been seen before.

Property bubbles are harder to explain, they occur almost routinely. Neo-classical economic theory, and every model of investment cant explain why somebody would buy a property with a price earnings ratio of 250 and then supplement that income with their own to pay back a bank instead of just buying a bunch of shares in Google and reinvesting the dividends.

What it really really cant do is explain that even though assuming such irrational purchases occur in the first place, why people are rewarded with capital gains, or why somebody would come and pay an even higher price to lose even more money on the same investment whilst bailing out the last fool.

Furthermore, nobody can explain that while you can shove the raw data down somebody's throat or have it so readily accessible it is routinely ignored and the converse is accepted as fact, as gospel.

How can you have the school of Economics, Finance and Marketing and have Marketers sitting across the hall who believe that 'you can't tell somebody what "everyone knows is false"' without that rubbing off on Economists that believe that people are 'rational profit maximisers.' How do they coexist?

People buy property for a number of reasons, most of them emotional and very few rational. Property is simple, physical, you can go and touch it, walk through it, inspect the carpets and survey the ceilings. The numbers, the monies are abstract, people only observe the buy price and the sale price. They don't look at the returns of the rent, the maintenance costs, the depreciation of the physical premisis, the council fees, the taxation, the mortgage repayments, the risk of vacancy. They don't notice that unlike a portfolio of shares, you sell the whole house or keep the whole house, you can't liquidate part of it.

Property is for most people a terrible investment, the best that can be said of it is that it is a forced savings account. Your actual returns will if lucky probably track inflation, some make money by timing the market right, but in the end you will probably sell it for the present day equivalent of what you bought it for just like depositing cash and withdrawing it.

But many feel it is their paths to riches, and that is where the heavily statistically laden theories of 'risk' let us students down. Risk is much broader, comprises of both chance and consequences and is somewhat more than historically observed volatility and correalation. It is even contentious as to whether statistical theory is valid at all.

But in property again to illustrate, you have prices going up, how far will they go? If the market is characterised by speculation, there's no way to tell. Put simply, if there is no reasonable explanation as to why people are paying the prices they are now, then we can have no reason to expect somebody to pay a higher price tomorrow. Rationalization steps in and seemingly fills that gap. But it is just a story nothing more. The 'causes' of the phenomena are not actually occuring. Which means you cant turn to them to make predictions about the market, what I am saying is: if Australia's population actually started shrinking tomorrow - experts wouldn't bat an eyelid and still predict growth, because they haven't been looking at the population anyway.

The prevalence of stories to explain irrational market behaviour makes property risky enough for me simply not to touch it. I don't know how long the boom will continue, because there was no reason for it to get this high in the first place. Similarly, I have no idea when it will end - because there was never any reason for it to start, why should it need a reason to finish.

But consider this: If you saw a basket dangling in mid air and you couldn't see what held it up, Would you put your baby in it? Many parents are doing exactly this when they urge their children to buy a house right now.

Tuesday, March 08, 2011

Climate Action

This Saturday at 11am there is a Getup! organised rally in Melbourne to support government legislative action on Climate Change. It is in response to an anti 'Carbon Tax' rally organised by conservative tools.

You should go. If you are unconvinced please read on, and hopefully my writings actually persuade you to go.

Worth Getting Wrong

"In any moment of decision the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing."
- Teddy Roosevelt.

You should go because this is a moment of decision. This is a moment of decision between doing something and doing nothing. The naysayers are opposed to doing anything, you should support doing almost anything to actually address climate change in some way.

So what if the Carbon Tax has flaws, or emission trading schemes haven't yet led to a reduction. Doing something, is what is needed. Even if in a years time it is a massive cock up, there will be something on the drawing board to go back to.

Australia does the world a disservice by doing nothing. Not only because the effects of climate change are global, but because it parasitically looks over the shoulder of governments actually actively doing something, flawed or functional to try and learn the solution whilst bringing nothing to the table. This behavior is not befitting of a nation that aspires to global significance and leadership.

The naysayers seem to feel that failure to implement the right solution is catastrophic, irreversible and a dead end in terms of learning. They urge more discussion. This is legislation, not a constitutional referendum, the oppositions dilemma is 'bogus' discussion can continue even after implementing a carbon tax, carbon trading scheme or even rationing. The only difference being that discussions occuring with some kind of action in place will be significantly more informed than discussions without climate action.

Those in opposition urge compliance to the old addage 'when all is said and done, more is said than done.'

Opposed sure, but what do they actually stand for?

Take the Kyoto Protocol. Destruction of the environment is not only rational; it's exactly what you're taught to do in college. If you take an economics or a political science course, you're taught that humans are supposed to be rational wealth accumulators, each acting as an individual to maximize his own wealth in the market. The market is regarded as democratic because everybody has a vote. Of course, some have more votes than others because your votes depend on the number of dollars you have, but everybody participates and therefore it's called democratic. Well, suppose that we believe what we are taught. It follows that if there are dollars to be made, you destroy the environment. The reason is elementary. The people who are going to be harmed by this are your grandchildren, and they don't have any votes in the market. Their interests are worth zero. Anybody that pays attention to their grandchildren's interests is being irrational, because what you're supposed to do is maximize your own interests, measured by wealth, right now. Nothing else matters. So destroying the environment and militarizing outer space are rational policies, but within a framework of institutional lunacy. If you accept the institutional lunacy, then the policies are rational.
~ Noam Chomsky.

You should go because climate action is positive. The opposition stands FOR nothing.

What does the opposition actually stand for? Why do the feel so strongly opposed to Climate Action? Who are we protecting?

I find the anti-climate change stance disturbingly vacuous, and perplexingly passionate. But there are clear losers from the introduction of a carbon tax - polluters.

Currently there is this terminology called 'externalised costs' say I'm eating KFC, it's a pretty likely scenario. Once I'm done eating I can put my rubbish in the bin. This costs me some time, or I can leave my rubbish, my mayonaise smeared wrappers, my greasy chickenbones on the table. This costs me no time. An employee instead or an impatient future diner will clean it up for me, I've externalised this cost, shunting it onto some other individual. KFC can absorb the cost (and probably does) in its prices, because it has little recourse. Generally I clean up after myself, because it costs very little.

Currently a company can spew shit into the atmosphere with no obligations to pay the costs of cleaning it up or mitigating the consequences. They clearly lose out if they have to pay the costs of the environmental damage they are doing. Currently it is free, they don't have to account for the damage and this saving can just be factored into their profits.

Some feel the cost of paying for this pollution caused by their processes or products would be so onerous, they wouldn't actually be able to operate anymore and thus have to move jurisdictions or shut down operations.

In essence this means the oppositions argument follows thusly:

"If we had to pay for the damage we are doing, then we wouldn't be able to do the damage."

Which I would hasten to point out is exactly the same argument of those in support of climate action. I make no bones about it, I want these industries to fail and dissappear or at the very least move offshore.

How can the argument be the same for both sides and conflict arise? Let me clarify, climate change effects everybody regardless of their station in society or geographical location (although the higher above the sea level you are the better off long term). The argument breaks down to 'who pays?'

Those in opposition stand for you, you as a human individual paying, and as Chomsky alludes to - your grandchildren. People who aren't even born yet should pay for the environmental damage caused.

There is no 'nobody pays' option. There is only a choice in how we pay. One way is for the industries with direct control over polluting to pay within the framework of their business operations (basically what is being proposed) through a tax or trading scheme. Another way is to simply tax citizens directly from their pay packets whether they are emitting greenhouse gases or not, which doesn't really discourage institutionalized pollutions, (they would have externalized this cost onto society in general).

Lastly there is simply leaving through the environmental fallout of climate change in full effect, this involves mass starvation, rising sea levels, weather based natural disasters, extinction of species, the collapse of whole eco-systems and in one form or another the collapse of civilization as we know it.

There is of course a gamble involved - climate change may be a bogus science, concocted by meteorologists with far less vested interests than those opposed to climate action. Isn't there some scientific debate?

Science is not Democratic

"Whenever we are talking about facts, certain opinions must be excluded. That is what it means to have a domain of expertise."
- Sam Harris.

You should go to get yourself informed.

'Science' is a word charged with meaning. It means "an enterprise that builds and organizes knowledge in the form of testable explanations and predictions about the world." Any fact about the world that you get to have an opinion on is an unknown and as yet untestable fact. Then you are engaged in speculation.

Here is what I know and it is enough scientific knowledge to convince me that climate change is probably man made.

1. Denser materials absorb more and retain heat for longer than lighter materials. Due to thermal inertia.

2. CO2 is denser than O2. CO2 is released into the atmosphere through the burning of fossil fuels in man made activities.

3. The effects of a warmer climate are cumulative. A warmer climate will melt ice caps at an increasing rate due to the loss of a reflective surface (the polar cap) and a warmer ocean.

These three scientific facts are enough for me to accept that climate change is probably happening and the consequences are probably dire.

What is the scientific debate? And whose opinions are valid in this debate?

I'm not a meteorologist or a climatologist, neither is Tony Abbott. But amongst people who do fall within this domain of expertise there is consensus. Scientific consensus.

What this means is that it doesn't matter what Tony Abbot, Barnaby Joyce or I think as to the likelihood of climate change occuring. Climate change will or wont happen regardless of our opinion. But in terms of any climate debate, there are opinions that are simply wrong, invalid and should be excluded. These are the uninformed, misinformed and just plain stupid opinions.

Science is not democratic, we don't get to vote on whether climate change happens or not, we simply get to vote on how we pay for it.

The Risks

"Climate change poses clear, catastrophic threats. We may not agree on the extent, but we certainly can't afford the risk of inaction."
- Rupert Murdoch.

You should go because it's probably the right thing to do.

Being generous and presuming that the scientific community may be wrong about the consensus they have reached that climate change is occurring, consider taking action as insurance. We can pay something now to ensure that something that may occur definitely doesn't. Or we can do nothing and risk the most catastrophic and unpleasant event that could happen to our species short of a Nuclear Winter.

The costs of climate action are really for most of us, quite insignificant, relatively cheap and only increase the more we delay. By contrast the costs of climate change are really, really, really, really expensive.

Thus follow Warren Buffett's advice - don't risk something important to gain something unimportant. The savings from doing nothing are not important, and it is being suggested you risk the planet, that I feel is important.

Democracy is not scientific

"In the United States, the political system is a very marginal affair. There are two parties, so-called, but they're really factions of the same party, the Business Party. Both represent some range of business interests. In fact, they can change their positions 180 degrees, and nobody even notices. In the 1984 election, for example, there was actually an issue, which often there isn't. The issue was Keynesian growth versus fiscal conservatism. The Republicans were the party of Keynesian growth: big spending, deficits, and so on. The Democrats were the party of fiscal conservatism: watch the money supply, worry about the deficits, et cetera. Now, I didn't see a single comment pointing out that the two parties had completely reversed their traditional positions. Traditionally, the Democrats are the party of Keynesian growth, and the Republicans the party of fiscal conservatism. So doesn't it strike you that something must have happened? Well, actually, it makes sense. Both parties are essentially the same party. The only question is how coalitions of investors have shifted around on tactical issues now and then. As they do, the parties shift to opposite positions, within a narrow spectrum."
~ Noam Chomsky.

You should go because your interests are being subverted through deliberate misinformation.

Kevin Rudd lost his office trying to introduce a taxation on abnormally large profits earned by corporations with no national allegiance from the sale of irreplaceable resources they didn't create, that would redistribute that natural bounty back to the community it rightfully belongs to and invested for the benefit of future generations.

It was this community that punished him for acting in their best interests, because it didn't bother to avail itself of the facts, whether it be the fact that BHP and Rio Tinto's share prices or profits didn't suffer at all while the Super Profits Mining Tax was on the table, nor did they concern themselves that even if those profits were redistributed away from shareholders, directors are under no obligation whatsoever to distribute profits to shareholders at any time in the form of dividends and would never be as generous as the government would have been anyway. They were convinced by the $120 million dollars spent daily on ad campaigns that had little factual basis convincing them that Australia's economy would go to hell in a hand basket if they weren't entitled to keep profits in excess of 40%. (or whatever).

Conversely Tony Abbott despite having the majority of seats in the lower house was denied office by a group of independents (and one Green member) who actually demanded of him to produce a budget for his proposed spending plans. Some described this as undemocratic. They were right, because neither the press or voting public bothered to subject him and his policy to even this basic level of scrutiny.

Democracy is not scientific. One can broadcast a message that has little to no factual basis whatsoever and influence democratic outcomes.

Wretched though it is, economics is scientific. The Super Profits Mining Tax would have been more beneficial to every average Australian than the compromise Gillard agreed to. This is the case no matter what Tony Abbott or any voting individual thinks. As Sam Harris alluded, certain opinions on economic well being are simply invalid, incorrect. The personal opinions of a mining magnate will not change the facts of what is actually in your best interests, but you can let it sway you. You already have, and it didn't even need an election, just opinion polls.

The same is happening with climate change right now. Climate change is scientific, not democratic, by that I mean that its the sort of thing that will happen whether Tony Abbott or anybody else personally believes in it or not.

In the domain of science we don't get to choose what we want to believe. We can only do this in democracy.

The point Chomsky makes is this, democracy can be swayed by opinion, and the vested interests in the private sector can simply outspend the government in making sure which opinion is prevalent. They need not present an opinion that has any factual basis whatsoever.

Scientifically it is my understanding the 'debate' on climate change is 95% of meteorologists believe it is happening and man made. 5% express some doubt as to whether it is primarily man made.

Democratically speaking any debate that conflicts with the private sector will be 95% opposed media spending and 5% in favor. Your elected representatives simply cannot defend themselves against the coffers of the businesses they are attempting to regulate.

They are subverting your democracy to serve their own interests. But democracy is still by the people, if not for the people. It requires your ignorance, complacency and unwitting support.

This is a direct challenge to the functionality of your democracy, and subsequently beyond doing the right thing, a reason to support a carbon tax and go to the rally on Saturday is that it is devaluing your democratic rights.

Do the right thing.

The business of business is business.
~ Alfred P Sloan Jnr.

You should go because even if it won't work, its the right thing to do.

There is a cliche in parenting pertaining specifically to doing the right or wrong thing. 'If your friend jumped off a bridge would you do it?' it is intended to teach the child to follow their own moral compass, moral imperatives and ignore infractions by others. I have little doubt that most parents and particularly parents that describe themselves as 'conservative' would agree with me that it is wrong for a child to steal other children's property, just because other children are doing it.

Yet we gladly suspend this thinking when it comes to climate change, one of the few things that could actually result in mass starvation and potentially extinction of the human race. At the very least an end to human civilization as we know it. Here it is wrong for Australia to act on climate change, until every other country (particularly bastions of functioning democratic and humanitarian leadership China and India) follows suit.

The logic being that we will export pollution and jobs to other countries.

Firstly, I would remind people of what ACTION on CLIMATE CHANGE actually is supposed to achieve. It is supposed to achieve the cessation of activities that contribute to climate change that fall within our countries jurisdiction.

The haters of climate action though, give those employed and invested in the industry no credit and demonstrate a distinct lack of imagination. Because jobs disappear does not mean they cannot be replaced. We already subsidize a large and unprofitable automotive industry, we can easily do the same for a large, emerging technology of the future such as solar. We can employ as many people as we like in this industry because there would be demand for its output even if we gave it away, that would render real benefits upon our society (free energy).

The naysayers claim to represent business interests and the market. This is complete fucken bullshit crap. They are just lazy people who would rather carry on doing what they've always done because it is easier than change and they lack the imagination to imagine a tomorrow. They are children trying to do whatever they can get away with, and that is kind of their job. But they are not representing a more informed view of what is good for business, good for the economy and good for you.

For a more informed view of what is good for business, good for the economy and good for you, take it from Drucker who LITERALLY wrote the book on management. the following is an excerpt from the effective executive and is I feel fittingly an effective criticism of the stand against climate change based on protecting the polluters' industries:

Du Pont has been doing so much better than any other of the world's large chemical companies, largely because Du Pont abandons a product or a process before it begins to decline. It does not invest scarce resources of people or money into defending yesterday...
...the need to slough off the outworn old to make possible the productive new is universal. It is reasonably certain that we would still have stage coaches - nationalized to be sure, heavily subsidized, and with a fantastic research program to 'retrain the horse' - had there been ministries for transportation back in 1825.
~ pgs 101-102 The Effective Executive, Peter Drucker.

Sound familiar? Because it is in essence the governments plans to invest in 'clean coal' research and carbon sequestration, rather than solar. I guarantee that pretty much anybody reading this book cannot claim to understand business better than Drucker.

Consider how passionate you would feel about defending the right of your parents to feed you (an infant) cheeseburgers for dinner every night, because cooking you nutritious meals incurs an increased cost in time.

Business has no right to a market, no right to profits, no right to customers. The market is a jungle designed to chew up business and spit them out for our benefit. As a society we have no obligation to protect the value of natural deposits of coal, asbestos, oil or anything else that somebody currently makes a buck out of. The stance of the opposition is in essence the same argument that would say 'Apple should be banned from releasing the iPhone because Nokia currently makes a profit from selling the Nokia 5160'.

Industries have a responsibility to themselves and their shareholders to invest in the future, don't give up yours to protect their past.

Friday, March 04, 2011

Metal, I don't love you anymore, but we'll always be friends.

Today I woke up and took the dog for a walk. It's nice. I reflexively thumbed the click-wheel of my ipohd and selected 'the roots' for my walking music. It felt like a refreshing relief for me.

I often talk up metal-crowds as the nicest crowds you will ever be a part of. Most of my encounters with metal fans are with big friendly fuzzy care-bare characters dressed in black t-shirts, denim jackets and the occasional studded accessory or chain. If I ever needed a hug at a concert at 2am I would hope I was in a metal crowd. That was my general experience.

But yesterday I discovered there are two types of metal fans. There are the aforementioned that are secure in who they are, don't care about changing trends or fashions or exerting the effort and financial commitment to following them and have found a happy dark place to call their home.

Then there are the type that are frightened, scared and angry, possibly bullied and feel ugly and possibly feel incredibly weak. Instead of addressing these issues though they cluster in a crowd of like minded people and far more aggressively than necessary say 'fuck you' to greater society.
I can only describe what it feels like, but it feels like imitation, it feels hostile and it feels pitiful. I imagine prolonged exposure would leave me full of either compassion or contempt and I hope its the former.

I guess the best analogy would be 'cornered animal', this brand of metal doesn't eminate strength but does seem dangerous. Like the whimpy kid in the trenchcoat mafia, you would never describe them as 'strong' but that doesn't mean they won't shoot you to prove a point. Like Fred Durst would probably stick a smashed glass bottle in your face if you called him a pussy, even though the conflict wasn't necessary and the action would only serve to prove that he was less than a pussy (possibly a dick).

As an artist, you often have the experience of picking up something you drew a while ago and your like 'man I drew this.' and not in a flattering sense, but this is good it means you have grown as an artist. Yesterday I saw a lot of bands I was into when I was 16 at Soundwave and some were awesome to see, others though I didn't even feel nostalgic, I just felt ... shmeh.

First and foremost Metal has gotten married. What I didn't witness yesterday but kind of felt - was the disturbingly holy matrimony between metal and christian rock. I saw Red playing on Conan and mentioned to then housemate Phil 'there's something not right about these guys... they feel... Christian.' I realise a lot of people are Christian. Most I know are Christian agnostic, never go to Church and literally don't sing about it. So what I mean about Red and what I kind of felt at Sevendust was this Gospel vibe, an incredibly shallow and unempowered emotional spectrum that says 'I'm hurting, somebody save me.'

I recall a lot, it makes me seem like a stalker most of the time, but I can't recall what I liked about bands like Sevendust, Mudhoney etc. the pre Nu Metal bands of the early to mid-90's. These weren't my favorite bands, I spent most of the time listening to Primus, FNM, RHCP, RATM, Tool and some others, but still I can't recall what if anything actually resonated with me.

But I think Metal and Gospel should get divorced, its a bad match and reflects badly on both sides of the coin.

The second matrimony is that of Punk and Metal. Sum 41 were the only recognisable punk band I checked out at Soundwave due to the schedule, and as my brother pointed out - 10 years ago they would have been the headline (I think they would have been alloted just before Blink 182) but Punk has - forgive me, somewhat died. People seem to forget pre-ok computer 90s often but the Tony Hawk days were huge, massive and I never got into the Punk Revival. The only band I could claim to truly have enjoyed from those days was Green Day whom were around long before Punk took over and are big long after (almost) all the punk acts have died.

But as Tenacious D sang in the 'Metal' you can't kill the metal. And I think that whats going on in Punk right now is trying to crossbread this genetic indestructability into itself in a desperate attempt to survive. It always seems to me that punk fans are numerous, but apparantly not numerous enough, they vocal and drumming traditions of Thrash/Death Metal seem to have particularly been misappropriated into Punk Rock. The use of double kick is profuse and the singers go off into screaming tangents. It's so metal it could hardly be called Punk, not even 'Punk Metal' as a meaningful genre.

I was looking for variety yesterday at Soundwave, and though I eventually got it, let's just say it was not to be found in the Punk Pavillion. Punk and Metal should get divorced because they are slowly suffocating each other and need the space.

Now as a snot-nosed kid I would have parochially stated that Metal drumming was some of the best, this is perhaps the biggest 'shmeh' thing for me that I experienced yesterday. It kind of started with Primus though. On Primus' discography you have two prominent drummers - Tim Alexander and Bryan 'Brain' Mantia.

Tim Alexander recorded for most of Primus' hey-day and is probably considered the 'traditional' Primus drummer. He was stadium rock style with two kick drums and a whole bunch of toms and I'm told 'very technical'. Back in the day I would have been all 'Tim Alexander is the shit'.

But getting psyched up for seeing Primus live I'd been listening to Brown and I'm not sure what changed in between now and 2000 but I was all like 'Brain is the fucken shit.' I think personality wise he was more of a fit for Primus and I have fond memories of the jerky and crap videos of early internet access days of Brain's antics posted on the primussucks website.

But I think in the same way that Southpark made the statement 'just because somethings complicated doesn't make it intelligent.' I think my easy reverence for drummers who play massive kits and play 'real fast' has dissappeared, and seeing live music probably helps because the beat is what you can dance to.

Somewhat hypocritacally this doesn't really apply to Tim Alexander so much, his beats are texturally interesting, and his return to Primus took them in a prog-rock direction that creates these sprawling rambling hypnotic sets that are head and shoulders above any other live music experience to be witnessed at Soundwave (in my opinion).

But the beats hammered furiously out by all these double kick weilding metal and punk-metal drummers are just... plain... boring. I don't get it anymore, it isn't impressive and it's no fun to be in the crowd to witness. It's just these long winded chops, and a beat you are supposed to jump up and down to but due to sheer physics you can't.

I'm sure the happy-metal fans would tell me that I was just seeing crap bands like Bullet For My Valentine, Stonesour, Sevendust and Rob Zombie with 'shmeh' drummers. And they are probably right.

My day was made though by the metal fan that yelled out between 'One Day as a Lion' numbers 'Play some real music' that relieved much tension and embarassment I had about hanging around white people. They just don't get it. Jon Theodore had a basic 5 piece drum set, made up Bonham style with one rack tom and two floors, and he just owned, schooled and fucked every other drummer there.

There is vernacular that you don't even need to describe the metal drummers - feel, groove, dance and perhaps even 'beat' but the key difference is this - the better the drummer the more you want to shift your weight from side to side in the audience and the less you want to jump directly straight up and down.

I don't want to make this a race thing, but the drummers at Good Vibes put the dance in the music, it's pretty easy to let all the Soundwave drummers wash over you impassively. Jon Theodore created so much space, this is something that now drummer of Primus Jay is pretty good at too, it is a pleasure to watch the Primus band members talk to eachother like jazz musicians through their instruments without ever losing the shape of the song. But Jay is a bit of a Tim Alexander replacement rather than having a distinct feel to him.

I no longer know where this post is going, it has become an ignorant persons discussion of drumming, but a glance at the post title tells me I should move on to the 'we'll always be friends' part.

There are metal bands that have plenty to offer, Tool and particularly Danny Carey on the drums has so much to offer and longevity as well I'm sure I will be listening to Aenima in my 50s. Sepultura with their Afro-Brazillian influences are great, again particularly for the distinctness of the drumming. Pantera tellingly are described as 'Groove-metal' and you can groove to it. Even Nu Metal can be appreciated with Irony like a bad sweater.

I will always have a fondness for metal, but like getting over an old love, you are never really aware of when it happens, but one day you just realise you don't occupy that same emotional space. I think this can only be a good commentary on my emotional constitution these days. I feel I am in no danger of being mistaken for a type 2 'Sad metal' fan, because thankfully I just can't relate to the insecurity in numbers. I lack the commitment and taste buds to be a type 1, but I don't begrudge them.

Iron Maiden were the headline at Soundwave and Iron Maiden were the crowd. I can't conclude that the crowd was in the same headspace as the band, but Iron Maiden are clearly happy guys that live securely in their own happy Iron Maiden world. They do wonderful things and you can tell are full of love for what they do and people in general. That's the kind of metal I can always be friends with, even if nothing about the band is easy on the eye - from the horrific artwork to the aged band members, they play face melters and they love it. They rock stadiums and they love it. They pack their elaborate sets into their own airplane and they love it. They love their fans, they love their sound, they love eachother.

I think that's what we all hope to achieve in life. But there are many different roads to get there, mine lies elsewhere.