The Great Reset (1)

My county out here in Krazifornia ostentatiously banned single-use plastic bags back in 2012, to “save the planet” naturally. So I whooped a whoop of joy through my mask when the local grocery store bagged my haul in plastic bags over the weekend. My guess is plastic bags will be back for good.

The aftermath of the virus crisis is going to change a lot of things—a process I’m calling “The Great Reset.” A lot of bad things are going to happen. A number of businesses have closed down for good already. Many others are going to shrink. Several department stores, like Macy’s, were already in trouble before the virus crisis, and J. Crew has filed for bankruptcy. General Electric has just announced that it expects to cut 25 percent of its workforce in its jet engine division permanently.

But not every business change will for the worse. The Wall Street Journal reports that another casualty of the COVID-Crash is corporate “sustainability” and other virtue-signaling luxuries of “corporate social responsibility.” The article opens with the confession of a green entrepreneur who specializes in selling products with minimal packaging and living a “zero-waste” lifestyle:

Ms. Singer, who prided herself on producing no trash that needed to be landfilled, stocked her kitchen with packaged food that would last for weeks. “I sacrificed my values and bought items in plastic. Lots of it.” She also learned a lesson: “I have many values and sometimes, as circumstances change, one of those values may take priority above another.”

Funny how that happens when things get real.

Today, every occupant of every C-suite is trying to figure out what they’re willing to throw overboard as the economic storm spawned by the pandemic is swamping their ships. Businesses that were planning to help save the world are now simply saving themselves. . .

Others are making their own cuts in response to the downturn. Unilever PLC suspended a number of its “change initiatives” that tackle complex social and environmental problems. (The company’s initiatives include water conservation and sustainable farming.) General Motors Co. killed its car-sharing program. Ford Motor Co. canceled an electric-car projectand postponed autonomous vehicles. Starbucks has paused the practice of filling reusable cups.

The end of nonsense is even spreading, like a contagion, to decadent Europe. Behold this report from the Financial Times:

Investors Blast EU’s Omission of Oil from ESG Disclosures

Investors, politicians and campaigners have hit out at EU regulators’ “ludicrous” exclusion of oil and gas from a definition of fossil fuels, arguing it will lead asset managers to understate their environmental risks. Under draft proposals for the EU’s sustainable disclosure regime, the European authorities responsible for banking, insurance and securities markets define fossil fuels as only applying to “solid” energy sources such as coal and lignite. This means asset managers and other financial groups would have to follow tougher disclosure requirements for holdings in coal producers than for oil and gas company exposure. . .

The latest EU proposals represent a significant watering down of its ambitious sustainable disclosure rules, which aim to give end investors clear information on the environmental, social and governance risks of their funds. . .

Wolfgang Kuhn, director of financial sector strategies at responsible investment group ShareAction, said that the EU regulators’ proposal was “like disclosing the amount of fat in a chocolate bar, but conveniently failing to mention the sugar content”.

According to Mr Kuhn, the exclusion of oil and gas “could, at best, result in an underestimation of the true investment risk, and at worst, contribute to further support for energy sources incompatible with Paris goals”.

Yes, I think ignoring the Paris goals is precisely the point of this bowing to reality. The EU apparently (or conveniently) “forgot” that while coal takes the most heat for its pollution, the main target of environmental campaigning for 50 years now is the oil industry.

Meanwhile, in Britain, demand for electricity is expected to be so low this weekend that utilities want to reduce the load on the grid, lest an overloaded grid suffers blackouts. So how do they propose to accomplish this load-shedding? You’d think this would be the time for renewable sources to shine, so to speak. But no. The intermittency of renewables destabilize the grid in these circumstances. Heh:

Blackout risk as low demand for power brings plea to switch off wind farms

Britain could be at risk of blackouts as extremely low energy demand threatens to leave the electricity grid overwhelmed by surplus power.

National Grid asked the regulator yesterday for emergency powers to switch off solar and wind farms to prevent the grid from being swamped on the May 8 bank holiday, when demand is expected to be especially low.

In its urgent request to Ofgem, it warned of “a significant risk of disruption to security of supply” if the “last resort” powers to order plant disconnections were not granted.

National Grid has to keep supply and demand balanced to ensure stable voltage and frequency on the network. When there is an imbalance the network can become unstable, leading to blackouts.

In other words, corporate America and corporatist Europe are relearning Milton Friedman’s understanding of “corporate social responsibility”: “There is one and only one social responsibility of business— to use its resources and engage in activities designed to increase its profits.” Because if you don’t have profits, you can’t hire back a lot of the 30 million Americans who have lost their jobs. Think of it as the economic equivalent of Dr. Johnson’s famous quip about how the prospect of hanging concentrates the mind.

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