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Mike Richman

Management

We’ll Always Have Paris…

… or not

Published: Thursday, June 8, 2017 - 11:03

F unny I should be writing this op-ed at this time, as our friend and colleague, Quality Digest’s editorial director Taran March, is currently traipsing around Paris and its surrounding environs, no doubt enjoying a baguette or brioche or some other culinary delight. Gratefully, that’s about the limits of my French, so I’ll forego any further attempts to depict what Paris might be like to Taran’s wondering eyes and bilingual pen.

Of course, Paris has been much on the minds of people across the world of late, and not just if we happen to have friends and loved ones visiting the city. That’s because, in one brash and brief speech in the White House’s Rose Garden earlier this month, U.S. president Donald Trump took this country out of the Paris Agreement on global climate change, to which former president Barack Obama had committed the United States on Earth Day, April 22, 2016.

There are several ways to consider the topic of climate change, and all of them are politically charged. As usual, my intention is not to get into the arguments for or against—there are many perspectives on either side, and I don’t want to debate them here.

I do want to consider one piece of this puzzle, however; a piece that’s possibly as contradictory, confusing, and partisan as any of the others, but one that’s so central to the work done by a large cross-section of our audience that I believe it deserves discussion. This involves the economics of carbon emission control, and what it means for manufacturers both here in the United States and abroad.

In his speech, President Trump said that the Paris Accord was a bad deal that was unfair to U.S. workers. “This agreement is less about the climate and more about other countries obtaining a financial advantage over the United States,” he said. Later, he added, “I was elected to represent the citizens of Pittsburgh, not Paris.”

The latter part of that quote is indisputably true. Trump is the U.S. president, and his charge and responsibility does not extend beyond the borders of the United States. But what of the first half of that statement? Is it true that the Paris Accord is really about the other industrialized nations of the world seeking to rip off the United States at every turn?

The answer is… maybe. The arguments in favor of leaving the agreement mostly revolve around the economics of carbon emission control, specifically that it would place draconian limits on U.S. companies, especially manufacturers. If, the argument goes, U.S. companies faithfully abide by the parameters of the agreement and others (i.e., the Chinese) cheat, then our companies would have spent more money than necessary in the short term for no benefit other than some amorphous goal of cutting future temperature increases that might very well be out of mankind’s control anyway.

There are a couple of ways to think about this. First, understand that the Paris Accord was constructed in such a way that “cheating” isn’t necessary. There are no hard-and-fast targets that any nation needs to abide by. If a party or other signatory wants to change their self-assigned targets, the agreement lets them do just that.

But let’s consider current energy needs and those of the future. Say that a nation does in fact cheat or at least change their targets in the future and dramatically increase carbon emissions. What then? Aren’t they getting away with something?

Again, maybe. If technology stays as it is forever, then sure, those that break or bend the emission rules are going to benefit. But things will change; they always do. And those who are making the effort to support green energy and reduce their reliance on the current technologies of the day will be the ones to reap the rewards of the newer, more efficient technologies of the future. It’s as true in energy as in computing, purchasing, personnel management, or any of the other key inputs that smart companies need to manage well.

Then, what about waste? Henry Ford famously admonished against anything going up the smokestack because it represented wasted materials and ate into profitability.

As broad and far-reaching as these questions may be, there is an even bigger one worth considering: What will be the framework of regulatory compliance and oversight in the future United States? Abandoning the Paris Accord is one move to give companies more leeway over how they wish to operate. Repealing Dodd-Frank may be next. In sectors ranging from financial services to housing to airlines, and many more, the federal government is stepping back from long-established controls and oversights to take a laissez faire attitude the likes of which this country hasn’t seen in something like 90 years. What are we to make of that and the long-term implications for sustainable business models?

Quality Digest editor in chief Dirk Dusharme and I talked about many of these very same topics on the June 2 episode of our weekly web TV show, Quality Digest LIVE. I hope you’ll watch our extended discussion on the politics of regulation in general and climate change specifically, with an emphasis on what leaving the Paris Accord might mean to U.S. manufacturers in the future. Click here to check it out.

Discuss

About The Author

Mike Richman’s picture

Mike Richman

Mike Richman is Quality Digest’s publisher.

Comments

We will always have Paris

Hi Mike R,

I just want to mention a few other things:

  1. We should treat CO2 as a symptom of global warming not the cause here is an article that does a good job of how to correctly look at carbon dioxide. I express it more in terms of a control chart rather than a financial aspect.

“Treat Carbon as the Symptom, not the Disease”

“Reducing greenhouse gas emissions can be misleading.

https://www.qualitydigest.com/inside/quality-insider-article/treat-carbon-symptom-not-disease.html

 

Published: Monday, February 9, 2009 - 15:02

Carbon dioxide emissions are symptomatic of energy consumption in manufacturing, especially in transportation. Therefore, initiatives to reduce them often cut supply chain costs as well. However, the exaggerated focus on carbon emissions is dysfunctional and it may overlook other cost-reduction opportunities.

William A. Levinson”

  1. Hill Cox in his November 1, 2010 article: Other Dimensions: The Power of Zero - There is uncertainty in all things except for death and taxes:

    http://www.qualitymag.com/articles/87559-other-dimensions-the-power-of-zero

     

    speaks volumes about driving pollution to zero:

    “Today, everyone seems to be on the zero bandwagon. They want all the bad things in life-real or imagined-brought to zero. No drugs-except those the government can tax-no noise, no accidents and the list goes on. They start with a zero tolerance policy for whatever they want changed and then expect government, of all people, to make it happen.”

     

    Continuing:

    “When it comes to anything chemical, it’s bad as far as these folks are concerned. The fact that some trace amounts of a chemical may be in everyone’s body naturally is ignored along with any science that shows there’s no harm to humans. Zero chemicals is good; anything else puts the world at risk by their reckoning.”

And thusly, “Demanding zero is easy, getting it is impossible. Labs that play fast and loose with technical details cash in on this quest for zero and are more than willing to oblige with uncertainty claims of “...a couple of millionths” as to what their uncertainty is. Customers searching for zero rarely question such claims or ask for an uncertainty budget (if there’s one to be had) to see if they make sense. It can rapidly deteriorate into a situation where you have the con artist leading the blind, both of whom actually believe that zero is possible. I suspect this problem will remain with us for some time until folks realize that there is uncertainty in all things except for the aforementioned death and taxes-representing zero life and zero money left after the taxes.”

 

  1. Lastly for now – here’s another link to another article in quality Digest trying to oppose Trump as well. Please note the comments:

“What the Trump Administration Misses About Regulations

They produce benefits as well as costs

https://www.qualitydigest.com/inside/standards-column/what-trump-administration-misses-about-regulations-032117.html?utm_source=MadMimi&utm_medium=email&utm_content=Today%27s+live+show%3A+What+the+Trump+Administration+Misses+About+Regulations&utm_campaign=20170323_m138286276_QDL+3-24-17+Blast&utm_term=What+the+Trump+Administration+Misses+About+Regulations

JOSEPH ALDY “

Comment:

03/21/2017 - 08:59 am — bgj1

Cost/Benefit Analysis

Trump did not eliminate all regulations or the ability to make more.  The problem has become regulators run amok.  The $2 billion cost to industry versus $100 billion benefit to "society" is a prime example.  The $2 billion assumes that industry will just eat those costs.  Power plants may be an exception to this but, in most cases, it is more likely the affected companies will move to a country where the environmental regulations are not nearly as high and impose a much higher cost on foreign "society" in the form of pollution.  Meanwhile, there are hidden costs to the US "society" in the lost jobs and the human welfare that comes with those jobs.  That $100 billion savings could be dwarfed by the overall cost of lost jobs and all the damage that does to a "society".  Eliminating pollutants that are known to cause cancer and human disease is one thing, but onerous regulations to reduce carbon dioxide is ridiculous.  It can be argued that even if CO2 does cause warming, said warming would be a net benefit (hundreds of trillions?) in that many more die because of extreme cold than because of extreme heat.  Regardless of that argument, putting a brake on and reversing some of the over-regulation of the last decade will only be a good thing for the US (net benefit of hundreds of trillions?).  Regulators have a habit of overdoing it to justify their existence.  I have seen that with safety regulators within companies.  Once the obvious problems are rectified, many poorly managed companies who create full time jobs for these safety regulators end up having to deal with the undue costs that are created with the ever "improving" safety that is created.  This doesn't happen in well-managed companies, but does anyone want to make the argument that the federal government is well-managed?

Thanks,

Ed Malsh

We will always have Paris

First thing: I would not call Trumps speech “Brash” but rather prudent!

Consensus via intelligentsia is not proof nor is their recommended course of action the most prudent!

Second, I hope you realize that CO2 is not causing global warming and we need to get out of the nonsensical idea of carbon management!  Please read the following quality articles concerning social responsibility.

http://www.qualitydigest.com/inside/quality-insider-column/combine-iso-50001-iso-14001-manufacturing-greenhouse%20gas.html

http://www.qualitydigest.com/inside/quality-insider-column/does-industry-need-social-responsibility-standard.html

http://www.qualitydigest.com/inside/quality-insider-column/henry-ford-renewable-energy.html

http://asq.org/quality-progress/2011/09/social-responsibility/fords-focus.html

The author questions cap and trade and taxation and suggests a socially responsible approach to deal with carbon.

“The GHG agenda is counterproductive

I believe GHG reduction to be a politically correct agenda that has no place in sound business decisions. Its evident purpose is to enrich special interests that wish to trade in carbon credits or sell renewable energy products or services that cannot pass a Net Present Value analysis without government support or intervention. (See Gillibrand Kirsten’s “Cap and Trade Could be a Boon to New York,” in the Oct. 21, 2009, edition of the Wall Street Journal.) Diverting hundreds of billions, if not trillions, of dollars in economic resources to “fight global warming” is quite likely to emulate King Canute’s futile command that the tide not come in. It must be noted that the world has gotten into and out of several ice ages with no anthropogenic intervention whatsoever.

It is in fact socially irresponsible to buy carbon offsets, or pay extra money for cost-inefficient renewable energy. Stakeholders such as employees, suppliers, customers, and investors must pay for this waste in one form or another, and waste of stakeholder resources is poor stewardship by definition. Purchase of a carbon offset can even pay for the same energy waste twice: first through elimination of any perceived need to address the inefficiency itself, and second through the purchase of what is essentially a medieval indulgence for sins. I prefer to pay for waste not even once.”

Also, in a Cornwall Alliance article “Why Did Some U.S. Firms Support Paris Agreement?”

http://cornwallalliance.org/2017/06/why-did-some-u-s-firms-support-paris-agreement/?utm_source=Cornwall+Alliance+Newsletter&utm_campaign=0e9529b560-EMAIL_CAMPAIGN_2017_06_07&utm_medium=email&utm_term=0_b80dc8f2de-0e9529b560-153389397

the author points out the following:

““Because of the failure of the predecessor agreements, Kyoto and Copenhagen,” Bolton said, “What [organizers] wanted was an agreement on anything, to create the foundation for what they’re really interested in, which is more international control over national decision making. This is really a global governance issue, which the Europeans just love, which Barack Obama just loved, which Donald Trump has now rejected. … To me the overarching, ultimately most important, more than constitutional question was, ‘Do we govern ourselves here, or are we going to cede governance authority to international organizations?’”

And this is the real issue about CO2 being a pollutant a molecule that all life on this planet depends on!

Ed Malsh

Thanks for the comment, Ed

We very much appreciate this feedback specifically, not to mention your readership of Quality Digest in general! There's a lot in your comment to unpack, and I'm still reading through the links you helpfully provided. Of course, I well recall the ones that appeared here on the QD site. I do think it's beneficial (where possible) to de-politicize this issue. Whether or not you believe that emissions hurt the planet, I think we can all agree that waste is bad, and emissions are essentially waste. Reducing or eliminating them through better processes is a good thing. Another angle worth considering is the way this issue is handled by nations depending on their economic standing. Poor countries tend to be harder on the environment simply because they live so much closer to the margins. Therefore, they don't have the luxury of demanding that their companies produce less toxic output, nor do they always have the money to pay for instituting and overseeing regulations. The other side of the coin, of course, is that poorer countries have a smaller industrial base, but on an output per hour basis (say a given type of emission from a given smokestack with a given volume, etc.) I think it's reasonably safe to say that a poorer country will tend to have greater problems in reducing emissions. Then there's the technological piece. As I alluded to in the article, the entire issue of emission standards and human-caused climate change may be mitigated or eliminated entirely by the rapid, even exponential growth in output per cost efficiency of solar, and the new revolutions in battery storage. It may, in fact, reach the point that some of these attempts at regulation will simply be abandoned as obsolete. As mentioned, there's lots here to unpack and think about. Thanks again to you for adding your voice to conversation.

Response to Mike R

Mike R.

Thank you for allowing my comments to post. It has been my experience that most people will ignore and not post what I have to say. You may want to de-politicize this issue but, unfortunately, the alarmists have politicized the CO2 causing global warming issue and they proclaim false accusations and put out misinformation. As you go through the articles or the links I provided, you will find the answers to your comments above. Basically, what I am saying is that we do not have to eliminate CO2 emissions because I know (at a 95% confidence interval) that CO2 is not causing global warming! Moreover, waste is not bad but waste is an opportunity to become self-sufficient if we understand that waste is a raw material that we can use to sustain our planet.  If we have the will to do so.

This format does not allow for a complete discussion on this issue but here is my abstract for a paper I am currently working on:

  • In this paper, I want to demonstrate that CO2 is not causing global warming. I will try to accomplish this using three reasoned arguments.

    • 1) Basic physical and chemical laws show that CO2 is really not a “greenhouse” gas! In that all molecules absorb electromagnetic energy from the sun and are black body radiators of lower energy waves directed in all directions, as the pie electrons go to a more stable energy state.  Hence no trapping of so called “dark energy”. (See original paper*)

    • 2) Integrity of the data – an informal statistical look at the data. Basically, the data is manipulated to give results researchers want to see. (See Statistical references* and equations).

    • 3) Hurricane data for the Atlantic coast demonstrates that weather follows a “predictable” pattern associated with ocean temperatures. Order out of chaos!  Our planet’s surface is 70% water and water is the main factor (along with the sun) in short and long term climate change and CO2 concentrations (See 2 Peter 3:7* and D. Wheeler).

       

      For now, I want to show how the actual data has been ignored to give misinformation and later go through the actual physical formula to show how this purposeful ignorance of the data is misleading:

       

  • 180 YEARS OF ATMOSPHERIC CO2 GAS ANALYSIS BY CHEMICAL METHODS

  • Ernst-Georg Beck

  • Dipl. Biol. Ernst-Georg Beck, 31 Rue du Giessen, F-68600 Biesheim, France E-mail: egbeck@biokurs.de; 2/2007

  • ABSTRACT

  • More than 90,000 accurate chemical analyses of CO2 in air since 1812 are summarized. The historic chemical data reveal that changes in CO2 track changes in temperature, and therefore climate in contrast to the simple, monotonically increasing CO2 trend depicted in the post-1990 literature on climate-change. Since 1812, the CO2 concentration in northern hemispheric air has fluctuated exhibiting three high level maxima around 1825, 1857 and 1942 the latter showing more than 400 ppm.

  • Between 1857 and 1958, the Pettenkofer process was the standard analytical method for determining atmospheric carbon dioxide levels, and usually achieved an accuracy better than 3%. These determinations were made by several scientists of Nobel Prize level distinction. Following Callendar (1938), modern climatologists have generally ignored the historic determinations of CO2, despite the techniques being standard text book procedures in several different disciplines. Chemical methods were discredited as unreliable choosing only few which fit the assumption of a climate CO2 connection.

 

So, the bottom line is GIGO and integrity of the data. Reliable data results in sound decisions.

 Please let me know if you want me to continue.

Ed Malsh