Tag Archives: Fisheries

How much will income inequality matter if the world’s oceans cannot produce food?

From the article titled “Climate-Related Death of Coral Around World Alarms Scientists” that appeared in the April 9th Edition of the New York Times:

This is a huge, looming planetary crisis, and we are sticking our heads in the sand about it,” said Justin Marshall, the director of CoralWatch at Australia’s University of Queensland.

Bleaching occurs when high heat and bright sunshine cause the metabolism of the algae — which give coral reefs their brilliant colors and energy — to speed out of control, and they start creating toxins. The polyps recoil. If temperatures drop, the corals can recover, but denuded ones remain vulnerable to disease. When heat stress continues, they starve to death.

It seems unimaginable that future generations may not be able to experience the beauty of these incubators for the majority of sea-life. The graphic provided is, to say the least, eye-opening:

Source: NOAA, GEBCO as published in The New York Times
Source: NOAA, GEBCO as published in The New York Times

Plastic Pollution On Track to Surpass Fish By 2020 while ALEC Derails Legislation to Curb the Problem

Fund Balance has covered the damage done to the world’s ocean’s by discarded plastic at great length. Based on World Economic Forum projections more pieces of plastic will contaminate the world’s ocean than there are fish within it by 2050. Only about 5% of plastic is recycled. There is no system in place takes these plastic materials back. So after their use they pollute the ocean. Freshwater systems suffer as well. Plastic pollution interferes with every aspect of the world’s water ecosystem.

Screen Shot 2016-03-21 at 1.50.40 PM
Photo Credit. The US Environmental Protection Agency.

 

All countries to one extent or another experience effects from the way plastic damages fish by filling up their stomachs causing them to starve or killing them by ensnaring them and causing serious injuries and even early death. Nations like the US and China, whose livelihood and or protein sources are highly dependent on the ocean worry.

The World Economic Forum argues that innovation will be essential for the world’s oceans. Yet we all have reason to wonder if such innovation will be choked off before its can be launched. The shadow governance group American Legislative Exchange Council (ALEC) promotes model legislation to prevent local governments from banning plastic bags. Such moves run counter to innovation and seek to create and coddle ALECs corporate backers and their monopolies, particularly the Petroleum Marketers who provide substantial funding for ALEC. Petroleum is used to make plastic. The authors the World Economic Forum study argue that plastic manufacturing should be decoupled from fossil fuels. This will require doable and currently in process innovation. Such efforts will create many new economies and industries, as opposed to protecting one from the competition such innovation would bring. Apparently ALEC is not interested in the health and well being of future generations. If it did, it could use its abundant resources to help innovation of healthy ways to manufacture plastic materials.

Source: World Economic Forum
Source: World Economic Forum

How can such groups claim to be focused on the future when they seek to continue to sell products that make the leave behind a badly damaged ocean for future generations? And what is the impact of such efforts to stifle common sense legislation to ban plastic bags on the drivers for innovation our way out of the plastic trap?

The Gulf Oil Spill, Financial Engineering and The Law of Unintended Consequences

Burning Oil in the Gulf

The financial crisis that was precipitated in 2007 by structured finance (credit default swaps, collateralized debt obligations et al.) parallels the Deepwater Horizon spill in important ways. And indeed, the very first credit default swap was engineered to offset Exxon’s exposure to remediation, fines and legal costs resulting from the Valdez spill.

Experts and regulators from both industries acknowledge the lack of proven methodologies both for assessing the risks of derivatives and the risks of deepwater and ultra-deep water drilling platforms.

Both are examples of advanced engineering methods applied in advance of thorough testing and risk assessment.  The practitioners, policymakers, and stakeholders involved with deploying these systems either ignored or failed to understand the risk and potential economic impacts of these technologies on the world in which we live. As a consequence, their customers, constituents and the natural world have suffered greatly.

Both disasters are examples of the lax enforcement of existing regulations and the failure or unwillingness of regulators to keep up with the astonishing systemic complexity that emerges from 21st century technology, whether software or hardware. For example, Warren Buffet famously called CDO and CDS’s, or derivatives, “financial weapons of mass destruction” and sought recently to protect Berkshire Hathaway’s holdings of certain tranches of derivatives, from new regulations on how to value them, since they are indeed so hard to value. As we can see, like deep-water drilling, the practitioners  and owners of these sophisticated technical financial instruments find them incomprehensible as well.

Interestingly, the SEC’s indictment of Goldman Sachs over its derivatives strategy and the havoc it caused dominated headlines in the weeks preceding the tragedy at Deepwater Horizon.

Economy Cube - Can This Puzzle Be Solved?

Until the government enacts legislation without multiple loopholes, euphemistically referred to as compromises, the public will continue to suffer and subsidize the failures of  untested and unproven technologies when they fail. One hears frequently about how top tier investment banks and petrochemical conglomerates attract the best and brightest. At Fund Balance, we want to see this amazing pool of human capital utilized to developing a sustainable economic future.

Capital Preservation: Protecting the Ocean’s Collapsing Fisheries

Mainstream media coverage of the critical depletion of key fish populations – and the serious economic threat it represents – echoes a key refrain at Fund Balance. Time Magazine covers how climate change is warming oceans and thus reducing their ability to support life, and CNN.com has a post by Fedele Bauccio addressing ways to halt overfishing.

Blue Fin Tuna

In addition the U.N. recently released new findings and recommendations for how humanity can decelerate the rapid depletion of the ocean’s biological capital.  Some key points:

  • Blue Fin Tuna populations have dropped by 83% in the past 30 years.
  • The annual 27 billion dollars in government subsidies to fishing, mostly in rich countries, is misguided since the entire value of fish caught is only 85 billion dollars.
  • As a result, fishing fleet capacity is 50 to 60 percent higher than it should be.
  • About 20 million workers will be displaced by ending these subsidies and thus retraining will be required.
  • Fish populations can rebound quickly if no-fishing zones are expanded and their limits enforced; for example, by allowing tuna to live twice as long as they currently do, they are able on average to produce twice as many eggs.

We hope that the ongoing Gulf Coast disaster heralds a new time – one where:

  • The false dichotomy between ecology and economy in the public mind is finally eliminated.
  • Government and industry realize that an environment where pollution and unchecked exploitation are controlled and tightly regulated is an environment that supports healthy economic growth.
  • People and governments vigorously address the fact that Climate Change is not the only impact of fossil fuel extraction and combustion, and that “market-based” strategies like cap and trade must be combined with other, precautionary and complementary policies.
  • The public consciousness is imprinted permanently with the understanding that drawing down capital at a rate that exceeds one’s ability to replace it is economic and biological folly at best and suicide at worst, whether of banks or fisheries.

Spirituality and Sustainability

Watercress Darter
Watercress Darter

One of our focal points at Fund Balance is extraordinary local efforts to sustain the environment. Recently a story appeared in the Birmingham News covering a Pastor’s efforts in Powderly, Alabama to save the endangered Water Cress Darter (Etheostoma nuchale).  It chronicles a story of how faith and efforts to sustain ecosystems converge.

The Pastor, 90 year-old Bishop Heron Johnson of the Faith Apostolic Church, is quoted as saying “But he has reveled in the idea of saving God’s creatures. ..It has brought excitement to the church,” Johnson said. “You are a keeper of the animals, like Noah,” a Mr. Jackson told the Pastor on Sunday at the dedication for the Seven Springs Ecoscape Garden.

Another interesting element of the story is how the process of saving the fish also revived its habitat and has generated an eco-tourism and meditation park: a beautiful example of faith and sustainability converging at the micro-economic scale.

Reversing the Expansion of Dead Zones in the Gulf of Mexico and Chesapeake Bay

Fund Balance has been examining the Dead Zones occurring in coastal and estuarial zones over the last year. Their magnitude is striking. Their damage to ocean ecosystems, seafood supplies and business is severe. And they are connected to vital food supply economies in the Midwest. Nitrogenous run-off from fertilizer used in large scale agriculture binds up and removes oxygen in the Gulf.

Does it have to be one set of regional American economic interests over another? The answer is no. For example, research performed at Dauphin Island Sea Lab off the coast of Alabama develops “resource management strategies which will foster the wise stewardship of diminishing natural resources”. There are ways that such principles are being applied in the Midwest along the Mississippi river. The book, “From the Corn Belt to the Gulf” (Nassauer, Santelmann, and Scavia, eds., Resources for the Future Press), details how farmers and industrial agricultural operations could reduce the amount of nitrogen flowing into the Gulf of Mexico by 40 percent. And it is increasingly clear that by planting specific types of grasses and engineering buffers, grain production in the great American Midwest does not have to contract in order for coastal economies to thrive.

Scientists and policy-makers in the Midwest have been at the forefront on this work. The Science Museum of Minnesota has produced an excellent presentation on the Deadzone in the Gulf of Mexico.  Fund Balance is working with policy-makers and bankers on our capital markets strategy for dealing with this issue in Washington, DC.

The Blue Economy: Inaction at Doha and the Rise of Dead Zones

This past week, countries meeting in Doha at the United Nations Convention on International Trade in Endangered Species voted down a proposal by Monaco and the United States to ban international trade in Atlantic bluefin tuna. The species, Thunnus Thynnus, is spiraling toward extinction, and is listed as endangered by the U.N. and every major international conservancy group.

This outcome underscores the need for policy makers and those charged with execution of policy to factor in the serious crisis that the world’s oceans and riverine systems face: our Blue Economy in peril.

Dead Zone Remote Sensing Imagery: Sannich Inlet off coast of Vancouver, British Columbia

A major issue for the world’ s coastal regions are the rise of Dead Zones. These vast expanses of ocean contain oxygen levels that are too low to support life outside of algal blooms. The Gulf of Mexico Dead

Zone is the size of New Jersey, or approximately 22, 608 square kilometers. The hypoxic state of these dead zones is caused by run-off from fertilizers used in industrial agriculture. Some recent informal polling at i-say.com conducted by Fund Balance gives some hope that the issue registers with the public. In addition, Fund Balance learned from several Iowan farm ope

rators about their efforts to reduce their run off: from  relocating feed lots farther away from rivers, to applying buffers made of specific nitrogen loving indigenous plants and compounds of gravel and sand. Many have realized economic gains from reducing nitrogen application to crops and benefited from increased production. Informative coverage on these Dead Zones can be found at Link TV.

Demarcation from living to dead zone off the coast of North Carolina

Such activity makes important steps forward. These actions require increased attention from agronomists, urban planners, policy makers and consumers. Just last week major media expanded its coverage of Dead Zones off the coasts of California, Oregon and Washington. Such man-made disasters unfold daily in the Chesapeake Bay as well as in within coastal regions across the globe.

Economic, Ecological Concerns Converge

One hears frequently these days that eco-nomic needs trump eco-logical ones in the public mind – especially here in early 2010. But it is increasingly hard to see a difference between the two at all.

Tanya Ott’s recent coverage on WBHM reporting on the challenges the city of Anniston, Alabama has faced is instructive. A large military base, Fort McLellan, closed there in 1995. The city was largely dependent on the revenue this installation created. Then came wide-spread land devaluation as a result of PCB contamination in the surrounding waterways. Next there was national publicity over local resistance to the incineration of deadly nerve gases left over from the military installation.

That was not the last chapter in the story. Ms. Ott notes how arts and humanities-based activities are leading the way toward the revitalization of downtown Anniston. This process also includes uncovering a formerly paved-over creek that runs through downtown.

On the policy front, various campaign officials for local and federal offices insist that jobs matter more than the environment in the vox populi and voting booth.  A recent article in the Demopolis Times on concerns over coal ash disposal indicates that wastewater from coal fired plants might not just be a NIMBY (not in my backyard) issue. Rather it may well indicate that yet another zone in the Black Belt is starting to question the long-term cost/benefit analysis of energy consumption that produces toxic water:

“While the Tennessee Valley Authority’s cleanup has removed much of the ash from the river, the arsenic- and mercury-laced muck or its watery discharge has been moving by rail and truck through three states to at least six different sites. Some of it may end up as far away as Louisiana.

At every stop along the route, new environmental concerns pop up. The coal-ash muck is laden with heavy metals linked to cancer, and the U.S. Environmental Protection Agency is considering declaring coal ash hazardous.

“I’m really concerned about my health,” said retiree James Gibbs, 53, who lives near a west-central Alabama landfill that is taking the ash. “I want to plant a garden. I’m concerned about it getting in the soil.” Gibbs said that since last summer there has been a “bad odor, like a natural gas odor.”

After the spill, the TVA started sending as many as 17,000 rail carloads of ash almost 350 miles south to the landfill in Uniontown, Ala. At least 160 rail shipments have gone out from the cleanup site, said TVA spokeswoman Barbara Martocci.

Since the EPA approved that plan, unusually heavy rain – including about 25 inches from November through February – has forced the landfill to deal with up to 100,000 gallons a day of tainted water.

The landfill operators first sent it to wastewater treatment plants – a common way that landfills deal with excess liquid – in two nearby Alabama cities, Marion and Demopolis…”

Birmingham’s Green Building Focus, mentioned in last week’s blog for their Green Industrial Real Estate Project, has just announced their second Green Building Focus Conference and Expo to be held in Birmingham, Alabama this August 24-26. Such activity exemplifies economic opportunity emerging from ecologic planning.

Climate Issues, Sustainability Cross Party Lines

magnoliaThere are more signs recently of the climate crisis, sustainable industry, and ecosystem repair issues crossing party lines and effecting change in Red States and rural areas. Tanya Ott reports from WBHM in Birmingham, Alabama about “tree-hugging conservatives” in Magnolia Springs, the reclamation of a wetlands and a burgeoning eco-tourism industry.  Read the story or listen to podcast here.

Writing in The New York Times, Thomas Friedman quotes Senator Lindsay Graham: “I have been to enough college campuses to know if you are 30 or younger this climate issue is not a debate. It’s a value. These young people grew up with recycling and a sensitivity to the environment — and the world will be better off for it. They are not brainwashed. … From a Republican point of view, we should buy into it and embrace it and not belittle them.”

In addition, the Times reports on a natural gas power plant in Indiantown Florida integrating an array of solar panels within its infrastructure. To quote the Times “It is an experiment in whether conventional power generation can be married with renewable power in a way that lowers costs and spares the environment.” It’s an interesting report addressing the challenges involved in scaling clean renewable supply along with issues of storage and transmission.

The Great Pacific Garbage Patch — In the central North Pacific Gyre, pieces of plastic outweigh surface zooplankton by a factor of six to one

The Great Pacific Garbage Patch — as covered by firstaffirmative.com

By Sara Laks and Steve Schueth

Why is it so important to be a conscious consumer and a responsible investor?

Here’s a reason for today:  The Island of Garbage swirling in the Pacific Ocean, also known as The Great Pacific Garbage Patch, North Pacific Gyre, Trash Vortex, and Plastic Graveyard.

garbage patch 1

This mass of plastic waste and debris is estimated by scientists to be anywhere from twice the size of Texas to twice the size of the continental U.S.  And the impacts for the environment and society are potentially just as colossal.

Captain Charles Moore, who discovered the patch in 1997, warns of the mounting implications of our floating pollution explaining:  “In the central North Pacific Gyre, pieces of plastic outweigh surface zooplankton by a factor of six to one,” according to a report based on Moore’s research.

“Ninety percent of Laysan albatross chick carcasses and regurgitated stomach contents contain plastics.  Fish and seabirds mistake plastic for food.  Plastic debris releases chemical additives and plasticizers into the ocean.  Plastic also adsorbs hydrophobic pollutants like PCBs and pesticides like DDT.  These pollutants bioaccumulate in the tissues of marine organisms, biomagnify up the food chain, and find their way into the foods we eat.”

So what does this mean for us investors and consumers?  It means that everything comes full circle.  Where we buy our goods from, where we invest our money, where we throw out our trash—it all matters.  The negative ramifications of not paying attention to the impacts our consumer and investor behavior produce are all too visible in places like the Great Pacific Garbage Patch.  Even if you live thousands of miles away as waste works its way up through our food chain, the problem looms closer and closer to home.  No one can afford to ignore it.

One of the most powerful strategies for change as an individual is supporting companies that have the most environmentally conscious products and services.  The more the public becomes aware and shows support for green companies the more incentives there are to make a difference on a larger scale.

Why is it important to be a conscious consumer and investor?  For the simple reason that if we don’t pay attention now we will pay for it later.

Steve Schueth, President

steveschueth@firstaffirmative.com

Sara Laks, Assistant to the President

saralaks@firstaffirmative.com