No word about the EU’s, and that is Germany, insane energy policy. Rather this economist pulls out the old saw, Putin. His post is based on this graph.
What irks him is that “Purchasing Power is transferred to Russia (and other energy exporters) and siphoned off from other sectors”. That is bad but he is an economist and has a solution: ” investing in energy saving (let’s commute less…) and green energy.”
Sorry, it is this (German) green energy dependency that is behind the immensely high energy prices in the EU and the solution in all seriousness should be, as he writes, “we will have to live closer to work or to work closer to home”. “Let’s move, instead of commute!”
That this would mean the building of new housing near the work place which would need energy, transport of building material by trucks (in his imagination they run on electricity probably), use and possible degradation of the environment etc. In short, his solution is a joke and his reference to Putin is pathetic.
What would this economist suggest is to be done with all those homes that will then be vacated? No loss of purchasing power for the owners that rented out their houses which are now empty?
Back to his nonsensical claim that “Purchasing Power is transferred to Russia (and other energy exporters) and siphoned off from other sectors”. By buying gas from Russia for money the acquiring country gets something in return, a product. In this case gas that offers its citizens comfort (heating) and electricity. Where would this economist rather invest while having less electricity and cold homes?
“No matter how much you or I might abhor companies that pollute the planet, gouge the sick with criminally high pharmaceutical prices, produce dangerous weapons for public purchase, or poison our democracy with dangerous conspiracy theories, we can’t make the shares of those companies disappear; someone will own them, and the more abhorrent those companies are, the higher the return those shareholders will reap.
Nor is that the end of the bad news for ESG investors.
If a shunned company gets cheap enough, it obviously becomes more likely to get taken private, further removing it from public scrutiny. In this regard, the recent ExxonMobil board insurrection led by Engine No. 1 is instructive, demonstrating how even small outside shareholders can curtail further drilling for fossil fuel. Good luck trying that with Koch Industries. Observers of the oil industry have recently noticed, for example, that while publicly traded companies have radically curtailed exploration, the slack has been taken up by private ones.”
“It is inconceivable that policymakers today, aided by their theoretical understanding of the mechanisms and by the statistical information at their disposal, would begin to make the serious errors committed by the governments in 1929-32.” J. Tobin