Because the SEC has nothing better to worry about — right?

I’m sure the next Bernie Madoff is being caught as we speak, given that even the Securities and Exchange Commission has found time to jump on the cause celebre of climate change. From the Washington Post:

The commission, in a 3 to 2 vote, decided to require that companies disclose in their public filings the impact of climate change on their businesses — from new regulations or legislation they may face domestically or abroad to potential changes in economic trends or physical risks to a company.

Chairman Mary L. Schapiro and the two Democrats on the commission supported the new requirements, while the two Republicans vehemently opposed them.

(snip)

Schapiro said companies already must disclose anything that can have a significant effect on their bottom lines. But she said the SEC’s action on Wednesday was intended to provide more guidance on what might be taken into account. “The commission is not making any kind of statement regarding the facts as they relate to the topic of climate change or global warming,” Schapiro said.

The last part — about the SEC’s not judging the facts relating to climate change — is bunk. That’s precisely what it’s doing, or at least that’s precisely what it, or someone, will have to do.

Let’s say a company has interests in Florida which are damaged by the next hurricane to hit that state. Who’s going to decide whether the company violated its fiduciary duty to shareholders if it didn’t warn them — based on facts or mere fear mongering — that the hurricane was more apt to occur, or that any hurricane to hit Florida was more likely to be powerful, because of climate change?

Similarly, who’s going to decide whether changes in the climate that hurt an agricultural company in the Midwest were the result of human actions or natural phenomena? If we’re talking about the overly broad term “climate change,” does it even matter?

No, it doesn’t. Companies will now be forced to make disclosures based on forecasts, even exaggerated ones, about the effects of climate change. Skepticism about the official line on climate change will be no excuse for failure to disclose. Of course the SEC is issuing an opinion about climate change.

The companies that stand to benefit from climate change — or, more to the point, regulations related to climate change — thus get another boost from an activist bureaucracy. As if investors didn’t already know the score when they considered putting money in a firm that lists Albert Arnold Gore Jr. as a director.

35 comments Add your comment

Horrible Horrace

February 5th, 2010
10:58 am

Unbelievable the govt agencies launching witchhunt after witchhunt. These dummycrats are so full of themselves it would seem a complete recall is in order.

CJ

February 5th, 2010
11:05 am

I agree with Kyle that the commission IS making a statement regarding the facts as they relate to global warming. But so what? What do so-called conservatives have against transparency (a fundamental component of free enterprise)?

Those investors who choose to insist that global warming is not caused by human activity despite the overwhelming scientific evidence to the contrary can carry on as if the icebergs aren’t melting and the sea isn’t rising. The rest of us have the information to make investment decisions based on the facts. That’s capitalism defined.

jconservative

February 5th, 2010
11:09 am

Kyle, that may be an issue but not entirely. Some US trading countries have already passed laws that their imports must adhere to certain “environmentally friendly” practices before the goods are permitted in country. We have some of the same type laws & regulations on our books and some members of Congress are calling for more. We want to know if this is hurting US companies. The SEC is just the vehicle for collecting the data.

joan1

February 5th, 2010
11:11 am

How on earth would a company know how “climate change” was affecting their business? I don’t think “climate change” equates to a hurricane or tornado. I thought it equated to a broader, overall systemic alteration in climate that regularly occurs, and is fact, always occuring. I would love to see some wit’s reply to this insane requirement, because I think it could be fun reading.

Horrible Horrace

February 5th, 2010
11:17 am

If a company/business addresses “climate change” in a report, even though required to provide bogus info, then off course climate change must exist. Therefore the need for Global wealth redistribution.

LibraryJim

February 5th, 2010
11:26 am

Human caused climate change has been discredited, not only by the ‘hacked’ emails (legally requested at first under the Freedom of Information Act), but also through the revelations that the IPCC is basing their conclusions not only on non-peer reviewed information, but on NON-Scientific information as well!

I saw an episode of “Top Gear” the other night where the hosts DROVE to the North Pole in a test of the latest SUV models. If the Arctic Ice was disappearing, it wasn’t apparent on the show. In fact, studies have shown the Arctic Ice Field has GROWN 34% in the last few years.
Just another case of how ‘tone-deaf’ to reality the Government has grown.

Cirque du Logic

February 5th, 2010
11:29 am

Look, if we don’t get serious about bank reform and keep allowing our financial institutions to commit the same risk-assessment errors over and over, then we’ll find ourselves revisiting the same recession over and over, and we’ll have to rename the stock market reaction as a “Dead Groundhog Bounce”. (instead of Dead Cat Bounce). Of course that assumes that the vicissitudes of the market were the result of the credit crunch and the recalcitrance of banks to loan money to the same deadbeats (other banks) which stiffed them the last time around, (if I may be so pedantic.)

Word up.

CJ

February 5th, 2010
11:31 am

Kyle left out the part of the article that said, “A number of large INSTITUTIONAL INVESTORS had been urging the SEC to put more pressure on companies to disclose more details about the effects of climate change on their businesses.” Clearly, this wasn’t some left-wing plot by Democratic appointees.

Kyle Wingfield

February 5th, 2010
11:41 am

CJ: That’s the difference between government acting in the interests of some businesses versus in the interests of freedom in the marketplace.

Besides, given the amounts of money controlled by institutional investors, I’m pretty sure they could get this info from companies on their own by threatening not to invest in them otherwise.

Jess

February 5th, 2010
11:54 am

Since the government has started using the term “climate change” rather than “global warming”, the whole concept has been watered down to a meaningless phrase. Since there has never been a time when climate did not change, what exactly does the government want to accomplish with their obsession? Climate control?

I for one do not believe in global warming. I can believe that some years or decades are warmer than others, but history shows that has always been the case. Now that enough doubt has been cast on the entire global warming theory [and it is a theory by the way] the government has quietly dropped the term for climate change. If it gets warmer, it proves they are right. If it gets cooler, once again they are right. Add it all together and it means nothing.

Yet this “nothing” is something the government can use to control people and industries. This, in the end, is the goal of this entire movement. Control is the reason for the SEC rules on this issue.

Hillbilly Deluxe

February 5th, 2010
12:01 pm

While the SEC cat is focusing on this, the Wall Street mice, aka rats, will continue to play. Wonder when the next big scandal will hit?

CJ

February 5th, 2010
12:14 pm

Kyle,

I appreciate your comment, but unless I’m misunderstanding you, your statement seems to imply that acting in the interest of some businesses while also acting in the interests of freedom in the marketplace is, by definition, mutually exclusive. Not necessarily. Both large and small investors can use or ignore such disclosures as they see fit.

Notice that required disclosures aren’t limited to weather-related trends, but must also respond to risks associated with economic, legislative and regulatory risks. LibraryJim might not believe in global warming, but the powers that be with most of our trading partners do (global warming skepticism is uniquely American, or more specifically, uniquely Republican). So, when these trading partners pass laws or implement regulations to respond to climate change, it makes sense to inform investors about how such changes might impact our investments.

As I indicated earlier, there’s nothing more fundamental to freedom of the marketplace than transparency (hence, the need for the SEC in the first place–to enforce transparency).

Jess

February 5th, 2010
12:29 pm

CJ,

Sorry but global warming skeptism is not uniquely American. There are as many, perhaps more, skeptics in Europe than here. I stay in touch with some of the friends I made while living in Europe, and it is their feeling that there are very few skeptics in the US. This is mainly gleened from mainline US media sources who pretty much present man made global warming as a fact and not a theory.

Cirque du Logic

February 5th, 2010
12:35 pm

Look, I’m no astronomer, but there are reports that the brown dwarf Pluto is changing color. Suddenly.

They say it’s methane reacting to the solar winds. On green giant earth, most methane comes from termites. So I guess, following the logic that has given us global warming theories, we have discovered life (termites) on the brown dwarf Pluto!

Horrible Horrace

February 5th, 2010
12:46 pm

No way…Its Global climate change occurring on Pluto.

Ragnar Danneskjöld

February 5th, 2010
12:51 pm

Is there any economic justification for the existence of the SEC? This is nothing but a jobs program for otherwise ineffective plaintiff attorneys. Abolish the SEC.

Davo

February 5th, 2010
12:54 pm

Pluto is now classified as a ‘dwarf planet’. A brown dwarf is an object several times the mass of Jupiter and is sometimes refered to as a ‘failed star’.

But ya. It’s a dynamic universe and we live on an ever-changing planet within it.

retiredds

February 5th, 2010
1:18 pm

Kyle, you’re out of your league on this one.

CJ

February 5th, 2010
1:23 pm

Jess: “Sorry but global warming skepticism is not uniquely American. There are as many, perhaps more, skeptics in Europe than here. I stay in touch with some of the friends I made while living in Europe, and it is their feeling that there are very few skeptics in the US…”

Clearly, your friends’ feelings can’t be relied upon.

Incidentally, regarding whether global warming is a fact or a theory, I have no direct knowledge. So, I rely on the reports of independent scientists who specialize in the climate (as opposed to science-fiction writers, scientists supported by the oil and coal industries, medical doctors, and the likes of Cirque du Logic and Horrible Horrace).

LibraryJim

February 5th, 2010
1:25 pm

CJ. the correct question is not “whether global warming is a fact or a theory” but “whether HUMAN CAUSED global warming is a fact or a theory” and it is a theory when asked in this manner.

Cirque du Logic

February 5th, 2010
1:37 pm

I ate too much fiber yesterday, and nobody can tell me what a brown dwarf is, okay, Kepler?

LibraryJim

February 5th, 2010
1:37 pm

Not “uniquely American” check out the BBC documentary on The Great Global Warming Swindle — I think it’s in parts on YouTube, as well as the article on BBC News “Whatever happened to Global Warming” by Paul Hudson, the BBC News Climate correspondent.

Scientists from all over the world are questioning the validity of the “alarmists” ’scientific’ research, methods and conclusions.

LibraryJim

February 5th, 2010
1:38 pm

PS, there are no such thing as “independent scientists” — they all get their funding from somewhere!

Jefferson

February 5th, 2010
1:52 pm

Jess

February 5th, 2010
1:53 pm

CJ,

If you do not know the difference between a fact and theory, this could explain a lot.

Jess

February 5th, 2010
2:13 pm

CJ,

Actually one of the main reasons Europeons have a large number of skeptics is that they have access to more news sources than here. Outside of Kyles column, where have you seen or heard much information at all about the problems climate scientists have had lately. I assure you this is not the case in Europe. England had broad coverage of “climategate”, and I assure you everyone in the country is fairly familiar with the issues it raised. This is not the case in the US where we have less than even handed journalism. Another reason people are better informed on the issues is that most TV in Europe broadcasts programs from all nearby countries, and you can buy a newspaper from most countries at any newsstand.

Th US is definately not one of the better informed countries in the world on worlf affairs,

Banned By Cindy

February 5th, 2010
2:46 pm

Global warming is a travesty of a mockery of a sham of a mockery of a travesty of two mockeries of a sham.” perpetuated by grant and notoriety seeking academic chicken-little posers and the whole charade is becoming more discredited every day, unless you’re some indoctrinated busy-body wuss like the prior poster…child of a patsie putz.

LA

February 5th, 2010
3:03 pm

Anyone seen Al Gore lately?

sam

February 5th, 2010
3:08 pm

i saw al last night, we smoked a J and laughed about this global warming thing…

sam

February 5th, 2010
3:11 pm

i can see where cindy is coming from…

SKYISFALLING

February 5th, 2010
3:37 pm

Another “sky is falling” contribution from Kyle? Hey Kyle, is falling sky also considered climate change? Check it out for your next essay on diddly squat.

Rafe Hollister

February 5th, 2010
3:43 pm

“climate change”=money to be made and wealth to be redistrubuted to “poor countries”. Obama sees it as another way for Government to control things. If he can convince enough of us that it is our best interest to support increased energy bills, then he reaps the benefit of more government money to spend. We know he is drunk with power when he is spending our money to enrich his friends in the enviromental and labor movements.

I think I will go build a fire and release some carbon in protest.

david goldstein

February 5th, 2010
3:47 pm

I do not believe in climate change. Why would all the past great inventions be the problem? The problem is the illegals. My wife left me for one because I would not hire them (except the females of course). If I could change anything it would me the size pf my penis. God bless

Jess

February 5th, 2010
6:14 pm

The reason cap-and-trade was discredited was that the extra cost to business would be passed on to consumers. If this admin. can produce phonied up numbers to show global warming costs more than cap-and-trade, they have a story to spin.

Problem is that the numbers they produce will be about as credible as stimulus jobs created.

Michael H. Smith

February 5th, 2010
8:35 pm

One no-spin problem still exists, even with cap-and-trade discredited: The EPA now has the power to do what cap-and-trade could have done if it were presently the law of the land today. In fact, it is arguable that the EPA with the power it now has thanks to the court, can do more than a cap-and-trade law ever could, when the law is in the jaw of the EPA. With this being the case, the EPA determines what are the facts and what is the law, regardless of the truth found in reality.

Yeah, another big socialist government agency!

“The course of history shows that as a government grows, liberty decreases.”
Thomas Jefferson

Be ever fearful of centralized consolidated power; be ever mindful of why the founders of this nation intended to prevent it.

“When all government, domestic and foreign, in little as in great things, shall be drawn to Washington as the center of all power, it will render powerless the checks provided of one government on another and will become as venal and oppressive as the government from which we separated.”
Thomas Jefferson