Hydrogen-powered, emissions free, mach 5 Awesomeplane

Nnng!

The LAPCAT project is a study, funded by Europa General R&D, that seeks to determine whether or not it is possible to create a plane that can cover long distances in a very short amount of time. The result? The A2 Mach 5 Civil Transport Concept.

The concept has been developed by Reaction Engines, which was formed by Alan Bond, John Scott-Scott and Richard Varvill. It is made out of two different pieces of technology. The First one is a hydrogen powered engine concept which can power an airplane up to speeds of Mach 5, that is, five times the speed of sound.

Why hydrogen? In order to achieve Mach 5, more power is needed than what would be commonly available from the common fossil fuels. The other innovation lies in the A2 Airframe. The Airframe is designed to withstand velocities that are five times the speed of sound, and carry up to 300 passengers.

I will sit and anxiously await its hitting the market. I’ll probably have to line up behind all the wankers who used to take the Concorde, I guess.

Russia expands its sphere of influence over natural resources

The last time this came up, Russia (Gazprom) was offering their help to Serbia. Today, it’s Bulgaria:

Bulgaria has agreed to a gas pipeline deal with Russia that is expected to strengthen Moscow’s grip over energy supplies to Europe.

The Bulgarian cabinet has agreed to allow the planned South Stream pipeline to pass through the country on its way from the Black Sea to southern Europe.

The South Stream project is seen as a rival to the planned Nabucco pipeline, which is backed by the EU and the US.

Interestingly enough, Bulgaria has a 20% stake in the Nabucco pipeline, too. One can see why they have an interest in the South Stream project, though (from the BBC):

Who wouldn’t want to have their hands on the fuel faucets of Europe?

EU vs. biofuels

Class participation! In my first Eco 1 lecture, I raise the issue of biofuels as the best modern example of the Economic Problem (unlimited wants: in this case food and energy, vs. scarce resources: top-soil). The original paper I typically use is this piece in Foreign Affairs, an early and excellent contribution to the debate.

So to the EU (via the IHT, via the student who emailed me the story. I read the IHT anyway, but I’m impressed that one of my undergrads also does, let me tell you):

In a sign of shifting attitudes toward biofuels, European Union officials are proposing to ban imports of certain fuel crops whose production could do more harm than good in fighting climate change, according to a draft law seen Monday.

The proposals, to be unveiled next week, are aimed at enhancing the environmental credentials of biofuels like biodiesel or ethanol to counter concerns that European drivers are playing a role in destroying wetlands, forests and grasslands in areas like Southeast Asia or Latin America each time they fill up their tanks.

In its draft, the EU requires that biofuels from crops grown on some kinds of land covered in forest, wetlands and grasslands as of January 2008 should be banned for use in the 27-nation bloc. The commission also would require that biofuels used in Europe should deliver “a minimum level of greenhouse gas savings.”

The text, which could change before European commissioners meet Jan. 23 to adopt a final version, also emphasizes that areas like rainforests and lands with high levels of biodiversity should not be converted to growing biofuels.

At the same time, the EU does not want to abandon biofuels because of the contribution they could still make to increasing Europe’s energy independence.

Funnily enough, it was only yesterday that I was discussing the detrimental effect of European market choices on ecological diversity loss in our oceans, but baby steps, I supposed. Any move in the ‘right’ direction is a ‘good’ move.

An issue not – apparently – addressed specifically (or initially) by the EU, but a big factor in the use of bio-fuels (this is, to save unnecessary debate, as opposed to waste-based bio-mass), is mentioned in the article:

In the United States, ethanol produced from corn has boomed, as has sugar-cane ethanol in Brazil. In Europe and to a lesser extent in the United States, vegetable oils have been converted into a type of diesel fuel by a simple chemical procedure.

In principle, these biofuels promise not only to displace imported oil but also to lower the amount of greenhouse gases being dumped into the atmosphere. The crops absorb carbon dioxide, the main greenhouse gas, as they grow, and the fuels made from them re-emit that same gas when they are burned a few months later.

But it is turning out that fuel crops hold the potential for considerable environmental harm.

Not only is native vegetation, including tropical rain forest, being chopped down in some cases to plant the crops, but the crops also are often grown using fossil fuels like diesel for tractors – and they demand nitrogen fertilizer made largely with natural gas.

Moreover, turning the crops into fuels can demand huge amounts of water.

Many bio-fuels are a lot like shale oil, tar-sand oil, etc.: maybe cost-effective, but not energy-cost-effective to pursue. As before, though, any government over-sight is better than none. It’d be nice if the US would follow this sort of thinking – they have the greater capacity to affect conservation.

Over-fishing = migration problems (no, not of fish)

Here’s an interesting string of negative externalities:

1. Fish prices in Europe do not reflect the depletion of fishing stocks (in, say, the North Sea)
2. Fishing stocks are depleted (this is the tragedy of the commons)
3. European countries move their fishing enterprises farther afield, striking bargains with African coastal countries to (over-)fish their waters
4. Fishing stocks in African waters become depleted also
5. Illegal immigration from Africa to Europe increases

Eh? We came upon the first few of these points way back in an earlier post:

… why are we doing this? Because we like fish (genereally speaking – I like them enough to wish we didn’t eat them) and we either don’t know or don’t care about declining biodiversity. Both of the latter are true. We don’t know. Do you know what it is you’re eating at the local chippy? Or which ocean the thing actually came from?

I fancy the chances that you don’t. You don’t know whether you’re eating Cod that was accidentally scooped up by a trawler looking for Haddock (or that you have Cod because the standard fishes of the day have disappeared). You don’t know whether you’re eating fish from the territorial waters of a poor country in Africa, because your country’s waters are ‘dry’ (so to speak) and you got these fishing rights on the cheap. Too cheap for them, and too cheap for you. Why?

I say ‘too cheap’ for you (the consumer) because of the not-caring crack made above. You might care, you might not. But when you enter the supermarket, odds are you buy a fish based on the price. That’s the information given to you. None of this other stuff is provided. There’s no pseudo-Surgeon-General’s warning that Eating This Fish Might Cause Critical Loss of Biodiversity And Shorten Humanity. As consumers we typically aren’t this well informed, and we purchase according to a price that does not include the loss of biomass, the loss of biodiversity, the loss of future wellbeing and income in Angola, etc.

I’ll just use Europe as an exemplar, here – it does the most over-fishing, and is attracting the immigration, so it works well enough.

So that’s the fish – how did they grow into chickens that are now coming home to roost in the form of illegal immigrants (this is a generic term – I’m prepared to argue that there are no such thing)?

A vast flotilla of industrial trawlers from the European Union, China, Russia and elsewhere, together with an abundance of local boats, have so thoroughly scoured northwest Africa’s ocean floor that major fish populations are collapsing.

That has crippled coastal economies and added to the surge of illegal migrants who brave the high seas in wooden pirogues hoping to reach Europe. While reasons for immigration are as varied as fish species, Europe’s lure has clearly intensified as northwest Africa’s fish population has dwindled.

Last year roughly 31,000 Africans tried to reach the Canary Islands, a prime transit point to Europe, in more than 900 boats. About 6,000 died or disappeared, according to one estimate cited by the United Nations.

The region’s governments bear much of the blame for their fisheries’ decline. Many have allowed a desire for money from foreign fleets to override concern about the long-term health of their fisheries. Illegal fishermen are notoriously common; efforts to control fishing, rare.

How do we fix this? Several options. Europe is blaming Africa:

European Union officials insist that their bloc, which has negotiated fishing deals with Africa since 1979, is a scapegoat for Africa’s management failures and the misdeeds of other foreign fleets. They argue that African officials oversell fishing rights, inflate potential catches and allow pirate vessels and local boats free rein in breeding grounds.

…

harbor, for instance, remains littered with 107 wrecked fishing trawlers eight years after the European Union promised to clear them to help develop the port.

In their defense, European officials say they moved to reform their fishing agreements in 2003 to address criticism that ship operators were overfishing and were undercutting local fishermen. Fabrizio Donatella, who heads the European Union unit that negotiates fishing deals, says the new agreements are models of responsible fishing and transparency.

“One cannot say we are not fishing the surplus or that we have not respected scientific recommendations,” he said. Ultimately, African governments must protect and manage their own resources, he said.

If Europe is so enlightened, then, it would behove it (speaking planetarily) to withdraw its fleets. “Europe” can hardly call for personal responsibility by African nations when the imbalance of economic might is so great – it just doesn’t work that way. If nothing else, it – and the rest of the world: be it the EU, WTO, WHO, UN hell, NATO would be fine – should just take over the task of survey and science with regards to African coastal waters and fishing stocks. It is, after all, in our interest to start conserving this resource at some point: I don’t know of fish anywhere else nearby, apart from this small planet.

African countries, in turn, can tell everyone to piss off – but many are in such a state of under-development that this just isn’t likely. Dysfunctionally-managed, often corrupt but, at best, just trying to fight their way out of a poverty trap when every tide flows against them, they’ll take the money, however unfairly distributed the returns on African fish are.

Within Europe, the negative externalities, as per the string at the top, have reached back into our economy – not into the market causing the harm, but back into the economy causing the harm, and this is a positive thing. By being made to bear some of the burden, Europe now faces a direct incentive to stop making such a bloody mess of things out of its own gluttony.

More likely? Merely nominal changes to development aid/behaviour in Africa, and harsh anti-immigration law enforcement/detention to deal with the human consequence. That’s just the way we do things.

Oil alliances

When I’m less busy (revising, vising, etc. research papers), I would like to pull together, in one discussion, the various hook-ups that Peak Oil is generating, these days. Iran, China, Russia, etc. It’d be handy to see it all laid out.

Until then:

Gazprom’s offer to take control of Serbia’s state-owned petroleum monopoly has divided the Serbian government and sounded alarm bells about the cost of Moscow’s political support.

The Russian state-run gas group aims to pay €400m ($590m, £290m) for 51 per cent of Petroleum Industry of Serbia, or NIS, without facing rival bidders.

…

The Russians have also promised to boost Serbian “energy stability” by activating a gas storage site. In return, Gazprom, its subsidiary Gazpromneft, and NIS would retain a monopoly on refining and a protective ban on private-sector oil and gas imports for five years.

NIS holds nearly 60 per cent domestic market share for natural gas, and more for heating oil, petrol and diesel. It is to be privatised with an initial 25 per cent stake to the winner of a bidding process involving Russia’s Lukoil and several central European oil companies early next year, after repeated delays resulting from Serbian elections.

Mladjan Dinkic, Serbia’s economy minister, called the offer to pay less than half of NIS’s $1.2bn book value “humiliating”, even though Gazprom would also invest €500m from 2008 to 2012.

Very interesting indeed.

Gender quotas in Norway quite the success

From yeterday’s Guardian:

Almost a quarter of Norway’s companies have failed to comply with a controversial law requiring them to increase the proportion of women on their boards to 40%, according to government figures. If they do not promote more women, they could be shut down.

Norway’s 487 public limited companies, including 175 firms listed on the Oslo stock exchange, have until the end of the year on Monday to implement a 2003 act that requires firms to boost the number of female directors.

…

The quota law was the brainchild of an unlikely feminist: a 52-year-old Conservative trade and industry secretary and former businessman, Ansgar Gabrielsen, who served in a previous cabinet. Gabrielsen’s focus was less about gender equality and more about “the fact that diversity is a value in itself, that it creates wealth.

“I could not see why, after 25-30 years of having an equal ratio of women and men in universities and with having so many educated women with experience, there were so few of them on boards,” he said.

“From my time in the business world, I saw how board members were picked: they come from the same small circle of people. They go hunting and fishing together. They’re buddies.”

Very interesting. One rarely sees the argument in favour of a quota explained so clearly. They aren’t standard: quotas for minority places in Universities, for example, can run in real trouble as move farther down the table of University prestige – mostly because the discrimination begins at birth. By the time everyone is 18 or 19, it’s a bit late to force Universities (or the workplace) to fix things. For women in the workforce, though, Gabrielsen makes an excellent argument: why be like Australia, with women effectively taxed out of the workplace while we suffer a shortage of skilled labour?

I think the argument that diversity creates wealth, while the status quo merely secures it (for the status quo) is incredibly sound. Just look at politics in the US – 97ish percent incumbency rates in the Senate, a current White House administration that began with a Boys’ Club extending back to Nixon. Who could seriously argue that this is fostering the greatest level of innovation and creativity in solving the country’s problems? A little diversity in any government wouldn’t hurt (getting women and minorities through preselection/primaries, of course, is another matter).

Retail dot co dot uk

Retail is something on which I harp(ed) often. Specifically, throughout the semester. My students must think I’m the most miserable bastard they’ve ever come across.

But. Like interest rates vs. inflation, I’ve found the English (or rather, the English media) to be more sincere and open about risks in the economy. The Big Picture, for example, routinely comes down on the scam of retail numbers, or that of housing sales (which he has been doing long before this piece popped up in the Wall Street Journal). Perhaps the Guardian is just staffed with miserable bastards like me. It would explain it.

Well. After exporting their sub-prime mess, it was inevitable that the retail mess would follow.

Britain’s retailers experienced tough trading conditions at the start of their crucial Christmas period and expect weak consumer demand to persist through the January sales, the CBI reported today.

In its monthly snapshot of the high street, the employers’ organisation said shops and stores had recorded their weakest sales growth in more than a year during the first two weeks of December.

While 42% of firms said business volumes were up on a year earlier, 33% said they were lower. The rounded balance of +8 percentage points was the weakest since November 2006 and the fourth successive month in which retailers had seen their sales expectations disappointed.

Should be interesting. I’ve explained frequently to students that the UK and the US have similar, and similarly, wicked problems: massive levels of unsecured debt holding up a retail-heavy economy. The problem is how to ‘fix’ both public and private dissavings without bringing the walls down around our ears (this was a question on the final exam, in fact – few students did a good job with it, though).

Apparently the Bank of England is also ready for another go-around. Add that to yesterday’s enormous intervention by the European Central Bank and to the US’ now-negative real interest rates. I’d be interested to see, around next February or so, some numbers on the total cash pumped into the OECD economies – dollar-terms, but also relative. I’d like to see the percentage increases in the money supply during this period (it’s that Austrian thing again).

The marketplace for (politically acceptable) ideas

This is either about free speech, free markets or the joy of being one’s own editor. Not sure, exactly. The weird thing is, I have no problem with nanny-state laws like fines for buying your drunk friends more booze (a New South Welsh law).

To the point. From the Guardian:

… in the eyes of Denmark’s ministry of justice, Mikkelson, the 56-year-old grandfather cheerfully grilling half a dozen different kinds of sausages by the roadside earlier this week is at the very least a terrorist sympathiser. And if the Danish justice minister, Lene Espersen, has her way, soon his only contact with the culinary world will be prison rations.

Alongside Schultz and five other Danes, Mikkelson could be in jail by Christmas for his part in one of Europe’s most curious court cases: the so-called T-shirt terror trial. His crime was sticking a poster up in his van for a brand of T-shirts bearing the logos of two groups classed by the EU as terrorist organisations: the Popular Front for the Liberation of Palestine (PFLP) and the Revolutionary Armed Forces of Colombia (Farc).

…

All are members of a Danish activist group called Fighters+Lovers and are charged with “sponsoring terrorism”, a crime under post-9/11 Danish anti-terror laws that carries a maximum prison sentence of 10 years.

Is this story’s setting – Denmark – being the same one as for those cartoons about Muhammed a coincidence? Who knows. Can’t they just spy on their citizens illegally, then send people off illegally to be tortured illegally (or legally, provided one is rendered extraordinarily to the appropriate country)? Honestly. Europeans. Such dramatics.

F + L seem harmless enough:

Fighters+Lovers is the brand that takes music and fashion beyond new horizons. We have a passion for change. In a world obsessed with envy and hate, Fighters+Lovers dares to speak up for brotherhood and the right to fight for what is right.

T-shirts don’t change the world. Neither does music. The world is already spinning and we simply make the tools and street gear for the creative people who make it happen. People with an attitude.

Kind of.

Fighters+Lovers is a private enterprise dedicated to the cause of freedom and hard-rocking street gear. Communication is key to any change. Fighters+Lovers aim to provide support for new equipment for radio stations and graphics workshops run by the Popular Front for the Liberation of Palestine (PFLP) and the Revolutionary Armed Forces of Colombia (FARC). This is our tribute to these freedom fighters.

Graphics workshops? Back at the Guardian.

They believe the EU “terror list” to be undemocratic because it is drawn up behind closed doors according to unknown criteria, and say that both PFLP and Farc are not terrorists but legitimate resistance movements comparable with Denmark’s own Nazi resistance during the second world war. They say that neither group is classed as a terrorist organisation by the UK, which does not defer to the EU on such matters.

What’s more, they say, they weren’t financing any sort of violence, as the £3.50 from each T-shirt sale that would have gone to the two organisations was earmarked for “humanitarian projects” such as equipment for radio stations.

I’m okay with most of that (I’ve posted previously about Palestine). I don’t – honestly – like their shirts that much. I downloaded their music, but I wouldn’t call it “Jungle”. I respect their beliefs and their commitment to them, but they are probably pushing provocative farther than I’d go (and I’m listed on ratemyprofessor.com as hating America!).

Ultimately, though, I’m still mostly an economist. By their own admission, their line of clothing appears not to be getting into hands that are likely to be throwing all that many bombs:

“… as the person who put together the hundreds of T-shirt orders we received from around the world before we got arrested, I can tell you that the majority of our customers were fat, old men,” she said. She knows the buyers were not hip young things because almost everyone asked for XXL size, and they had “old-fashioned names”.

I believe in the marketplace for ideas. If “the government” believes so strongly that this is somehow wrong, let them try to convince us. They’re welcome to abuse their own position as the government to criticise F + L like the mature adults we expect them to be and, having balanced the information in the marketplace, it will be up to us as consumers to make the judgment. Does such overt criticism spawn provocation and rebelliousness? Yes, of course. They may well make F + L most profitably notorious – that’s the way it goes.

This is the same all over (speaking geographically and with respect to “the issues”). I believe in gay marriage and I believe in the right to choose. These are fundamental to my notions of habeas corpus: I take it a mite further than merely having the right to have one’s body. I reserve the right to have my own mind; I reserve the right to decide for myself that which is good and bad, and I go along with the invention of Government for the specific purpose of doing the things that I and society have agreed Government should do, and for the purpose of keeping me properly informed, so that the decisions that I make are rational ones.

Other people won’t make rational choices, and that’s fine: that’s the way it goes. People will object to people buying these tee-shirts; people will object to people sending money to the Israeli Defence Force. People will object to their taxes being used to pay for the UN; others will object to their taxes being used to provide billions in aid for Israeli materiel. People object to abortion; I object to a a wombless room of men so old and corrupt they should not even be offered another term deciding what women get to do with their bodies. Do women ban men from starting wars?

So it goes. There’s a marketplace for ideas, and it should be allowed to thrive. Can a tee-shirt be doing the damage, instead of the guns, the income inequality, the land-and-water-grabs, the UN, the IMF? Spare me. NBC played the tape of crazy Virigina shooting guy – are they in gaol? F + L are in gaol, but are the companies that manufacture the weapons that do the damage in any danger of the same treatment? Do we impose sanctions on China or Russia when their guns wind up in the hands of the wrong people, while our guns are going into the hands of the right people? We do none of these things. Who are we to judge? Like any intervention by Government, this should be recognised – and evaluted – as such. This one is not warranted; it was not requested; it does not benefit us (or, rather, the Danes).

Does this all mean Threadless.com gets shut down for this tee-shirt?

Does it mean I go to gaol for wearing my copy of it?

And at the end of the day, if one cannot wear their politics on a tee-shirt, what is the point of having politics at all?

China, EU, US update

Today’s news:

European finance ministers pressed China to let its currency strengthen so their economy no longer bears the brunt of the drop in the U.S. dollar.

With the dollar plumbing record lows against the euro this month, the officials meeting yesterday in Brussels complained the European economy is shouldering a disproportionate share of the U.S. currency’s decline and urged the Chinese government to share the pain by allowing the yuan to rise more broadly.

…

While the yuan has gained 5 percent against the dollar this year, the currency has dropped 4 percent against the euro, hurting Europe’s exporters and forcing its trade account closer toward deficit.

Specifically: how many US dollars with a Yuan get you?

And how many Euro will it get you?

The news a little over a month ago, now:

European Union finance ministers open two days of talks Monday to discuss the United States’ slowing economy, feeble dollar and massive current account deficit as major problems for the EU and the rest of the world.

Europe is starting to feel the bite as the U.S. dollar plummets, making French wine, Italian fashion and German cars expensive purchases for the EU’s main export market in the U.S.

Did anything change? Nope. China will deal with its under-valued currency when its needs dictate, not when other countries moan about it. It has a permanent UNSC seat, gained accession to the WTO, still keeps Taiwan out of the WHO – is there something China wants but doesn’t have, that we can give it? No? Then the under-valued Yuan is China’s bargaining chip, not ours.

Before we get too worked up, recall that the Euro is also appreciating against the US dollar, outside of China:

Back at x-rates.com (the graphs are from Yahoo), the Euro has appreciated against the US dollar (January – November ’07) 12.13%. The Yuan has appreciated against the dollar by 4.68% – that leaves a 7.45 percentage point difference in performance – specifically a 7.45 percentage point advantage in the Euro over the Yuan. So what to expect? An appreciation in the Euro against the Yuan, of course. We get one: a 6.66% depreciation. That’s almost bang-on ((1.1213 – 1.0468)/1.1213 = 6.64%).

I don’t know that the EU is claiming that China is causing this by keeping its currency’s appreciation against the dollar lower than that of every other currency (ours is trading back below 90 cents – for now. The longer it stays down, the happier I’ll be).

The comlaint is, as before, than the US dollar is tanking against everything, while the Yuan is staying relatively low against it – meaning it is depreciating relative to all the currencies whose exchange rates are accurately reflecting the depreciation in the value of the US dollar. I suppose I just see it as less straightforward: amongst other things, who would have been borrowing Yuan to sell to lend to the US, in the first place? Now that the US rates are sliding while everyone else is, more sensibly (yet beyond the comprehension of Bernanke and Paulson) raising theres, who will be ditching dollars to lend to China?

European politicians wrestle with high gasoline prices

From the International Herald Tribune:

“It’s a very difficult situation for governments,” said Colette Lewiner, an energy expert at Capgemini, a consultancy. “What governments should be doing is lowering the tax on the oil products, but that would mean lowering their own expenses and breaking spending promises, so governments are trapped.”

A big worry is that fuel price rises are contributing to an inflationary price spiral. Another is that past increases have triggered paralyzing national strikes. But European governments rely heavily on fuel taxes to balance their budgets, drastically reducing the scope for cuts.

In France, for example, taxes on unleaded gasoline represent 62 percent of the cost of a liter of fuel at the pump, while taxes on diesel represent 53 percent, according to the Union Française des Industries Pétrolières. Those taxes are the largest source of state revenues after value-added tax, income tax and business tax, said the industry association.

There is a picture painted of a government needing excise revenues; I would suggest the flip-side: that bowing to the pressure from fuel-intensive industries would only promote an expansion in the demand-side pressures on oil – precisely the cause of our environmental (and many of our economic) problems.

For example:

French fishermen, who already benefit from hefty fuel subsidies, have mounted the strongest protests so far over fuel costs.

This month, the fishermen – some of whom use several hundred of liters of diesel each day to power their boats – blocked fuel depots in Atlantic coastal regions to draw attention to costs that have climbed to about 50 euro cents a liter up from about 30 euro cents a liter. Only below 30 euro cents a liter can fishing be profitable, they say.

Amid reports that some gas stations in Brittany were running dry, the fishermen went back to sea Thursday, after President Nicolas Sarkozy of France visited the Atlantic coast and personally offered concessions Tuesday.

What? The demand for fuel by fisherman is not the demand for fuel: it is the derived demand for fuel, and it is a function of our actual demand for fish. That is to say, we, the consumers of fish, demand fuel such as it is needed to get us that fish – in given quantities, according to price.

Implications? Oil doesn’t have to be manufactured – via subsidisation or differential tax exemption – to be 30 Euro cents per litre so that fishing can be profitable. Fishing has to decline in accordance with the decrease in the quantity of fish demanded. Some fishing operations (those with lower costs) will stay in business; others will not:

The effect of the firms that shut down because they cannot achieve profitability will reduce market supply, thereby increasing the price. This is the law of demand: as oil prices appreciate, fish prices appreciate; as fish prices appreciate, the quantity of fish demanded decreases.

Alternatively, everyone stays in business, and charges a price higher than P^*, so that they keep making a profit. Rather than a leftward shift, the supply curve, above, shifts upwards – with the same effect. As oil prices appreciate, the costs of production (of fish) escalate. As the costs of production increase, the supply curve shifts backwards – but demand does not change. Therefore less fish is bought because people with the lower willingness-to-pay stop buying fish. For some firms, as in the first graph, this price increase will get back to where some intersection of MR and MC can be found – for some it may not. They either pack up and leave, or continue running (I didn’t bother with Average Variable Costs) and try to turn things around – by, say, picketing the government for lower excise duties on their fuel.

Basic economics. Cruel economics, perhaps, but basic economics. In this world, resources are scarce. This is the first principle of economics: resources are scarce, and allocating those resources is the defining problem of economics. Fisherman don’t get to remain fishermen because they’ve always been fishermen. They get to remain fishermen if we are prepared to pay the prices required for them to remain fishermen.

I realise we’re talking about already taxed fuel, here: at issue is not, simply, our willingness-to-pay for fish. That, too, however, was/is a consequence of a society-wide (political economy theory permitting) allocative decision-making process. If our opportunity cost of that tax revenue (or the environmental externalities of the fuel use) remains higher than the cost of losing jobs in the fishing industry, then jobs in the fishing industry have to go.

The article is quite good (to say the least). Further examples are (of course) agriculture and taxi-drivers. Agriculture becomes interesting because, like fish – but much moreso – national food security can become an issue (in which case we, as society/consumers, would be willing to pay what is required for that security. So far it would appear that, with regards to fish at least, either we aren’t, or we aren’t understanding the problem in those terms).