Goldman Strikes Again: Did A Probe Into "Global Warming" Fraud Cost A Prime Minister's Job

Tyler Durden's picture

When Tony Abbott became Australia's prime minister in September 2013, the chain of events that would prematurely end his tenure may already have been in motion: just a few months later China would order its out of control shadow banking system to put on hold its debt issuance machinery, which as we reported a year ago, ground to a complete stop around November 2014 (which also was the explanation for the dramatic slowdown in the US economy over the winter as the collapse in China's Total Social Financing growth sent a deflationary ripple effect around the globe), which - as we warned at the time - would have dire consequences on all of China's "feeder" economies, namely Brazil and Australia.

But while we have been tracking the implosion of Brazil's economy since December, long before the rest of the world noticed the calamitous collapse of what was once Latin America's most vibrant economy, it was a very recent event in Australia - not the country's parallel economic slowdown also due to China's hard landing: that was painfully clear long in advance - that took many by surprise. Namely, the resignation of Tony Abbott almost exactly two years after becoming Prime Minister.

And while it is easy to blame his admission of failure on external factors, namely the Chinese slowdown, a very surprising finding has emerged over the past few days, one which reveals Abbott's "ouster" in a totally different light.

According to Freedom of Information documents obtained by Australia's ABC, now-former prime minister Tony Abbott's own department discussed setting up an investigation into the Bureau of Meteorology amid media claims it was exaggerating estimates of global warming.

Yes, it appears that the prime minister himself had dared to question to prevailing status quo on "global warming."

ABC reports that in August and September 2014, The Australian newspaper published reports questioning the Bureau of Meteorology's (BoM) methodology for analyzing temperatures, reporting claims BoM was "wilfully ignoring evidence that contradicts its own propaganda."

Naturally, the BoM strongly rejected assertions it was altering climate records to exaggerate estimates of global warming. Nevertheless, as the following document obtained by the ABC shows, just weeks after the articles were published, Mr Abbott's own department canvassed using a taskforce to carry out "due diligence" on the BoM's climate records.

As it turns out, late in 2014 the Australia government set up a taskforce to provide advice on post 2020 emissions reduction targets ahead of the United Nations Paris climate change conference in December 2015. The Department of Prime Minister and Cabinet originally wanted the taskforce to also conduct "due diligence to ensure Australia's climate and emissions data are the best possible, including the Bureau of Meteorology's Australian temperature dataset".

An accompanying brief seen by Mr Abbott noted that "in recent articles in The Australian, the BoM was accused of altering its temperature data records to exaggerate estimates of global warming". To wit from the ABC:

"The way the Bureau manages its climate records is recognised internationally as among the best in the world," the brief said.

"Nevertheless, the public need confidence information on Australia and the world's climate is reliable and based on the best available science."

Inexplicably, instead of letting it go as most "status quo" governments always do, the cabinet kept pushing with demands for audits: audits which, if taken too far, may reveals some truly very "inconvenient truths" if not so much about global warming, as about the propaganda behind it and the firms that stood to profit from such propaganda.

The pressure intensified when Mr Abbott's business advisory council chair Maurice Newman wrote an opinion piece in the paper, demanding a Government-funded audit and review of the Bureau.

 

The concerns centred on the Bureau's temperature homogenisation process — the method in which it adjusts temperatures for weather sites based on factors like trees casting shade or influencing wind or if the station is moved.

It was then that the pushback started in earnest: enter Greg Hunt, Australia's Environment Minister who would do everything in his power to halt Abbott's crusade to "audit" the BoM.  In a letter to Abbott in November 2014, Hunt called for the removal of the due diligence clause, pointing out that he and his parliamentary secretary, Simon Birmingham, had already “established a strengthened governance oversight of the bureau’s ongoing work in this area." In other words, "trust us" - we are the government... we work for you.

Both the Department of Environment and Environment Minister Greg Hunt argued against having the taskforce investigate the Bureau. One Department of Prime Minister and Cabinet bureaucrat described a Department of Environment official as being "on a campaign" to get the references to BoM removed from the taskforce's responsibilities.

 

Further documents appear to show Mr Hunt convinced senior cabinet members to remove any references of "due diligence" or "quality assurance".

 

In a letter to Mr Abbott written on November 18 last year, Mr Hunt highlighted the fact the "draft terms of reference refers to the taskforce doing due diligence on the Bureau of Meteorology's Australian temperature data set".

 

"In doing this, it is important to note that public trust in the Bureau's data and forecasts, particularly as they relate to bushfires and cyclones, is paramount," it said. "Given the recent publicity about the Bureau's temperature data sets, Senator Birmingham and I established a strengthened governance oversight of the Bureau's ongoing work in this area."

Said otherwise, don't you dare question global warming or else the public may lost faith in the Bureau of Meteorology's forecasts about "bushfires and cyclones." One couldn't possibly make this up if one tried.

As for the assurance Greg Hunt gave to Abbott to drop his audit, it basically was a promise to "self-regulate" better through a, drumroll, technical advisory forum:

The strengthened governance of the Bureau that Mr Hunt referred to is the setting up a Technical Advisory Forum to review and provide advice on the Bureau's temperature data — a recommendation from an earlier review of the Bureau's processes.

 

"It is important to emphasise that this is primarily a matter of meteorology, statistics and data assurance," Mr Hunt wrote in his letter to Mr Abbott.

This, of course, is a page right out of the Keynesian/monetarist playbook: one can't sow seeds of doubt in the mind of the public that the most sacrosanct assumptions about the world are wrong by open government probes be it by auditing the Fed, or Hillary's email server... or Australia's meteorological data, so instead let's just take their word that all the data will be scrubbed and double checked.

A 2011 review found the Bureau's data and analysis methods met world's best practice but recommended a group be set up to review progress on the development and operation of the temperature data. 

 

The 2015 panel included eminent statisticians and members have told the ABC they were in no doubt that it was set up in response to the newspaper articles. A draft letter from Mr Abbott addressed to Mr Hunt showed that Mr Abbott wanted personal updates on the panel's review.

 

"The credibility of Government agencies is important and must be ensured," the letter read.

And while the review naturally cleared the BoM of any data "goal-seeking" when it was released in June, perhaps the threat of future such audits was simply too much - three months later Abbott was gone.

This is not Abbott's first concern about either met data, or global warming. As the Guardian notes, Abbott previously questioned the reliability of climate science, but when he was prime minister he repeatedly said he accepted the climate was changing and humans made “a contribution”. In other public statements, Abbott said coal was “good for humanity” and wind turbines were “visually awful”.

Perhaps the recent probe into the "statistics and data" behind the Australian Bureau of Meteorology were the straw that broke the camel's back: clearly Abbott was not going to be appeased and would continue his probes and audits into the "conventional wisdom" behind global warming, a persistence which threatened one firm more than any other.

Goldman Sachs.

While we hardly have to remind readers that it is Goldman that conceived of the carbon-credit market, and was behind cap and trade, here is an (in)convenient summary of who the true puppetmaster is behind the worldwide infatuation with stopping "global warming", and who stands to benefit the most as the world is manipulated into doing everything to kill global warming dead in its tracks, courtesy of Matt Taibbi:

…Fast-forward to today. it’s early June in Washington, D.C. Barack Obama, a popular young politician whose leading private campaign donor was an investment bank called Goldman Sachs – its employees paid some $981,000 to his campaign – sits in the White House. Having seamlessly navigated the political minefield of the bailout era, Goldman is once again back to its old business, scouting out loopholes in a new government-created market with the aid of a new set of alumni occupying key government jobs.Gone are HankPaulson and Neel Kashkari; in their place are Treasury chief of staff Mark Patterson and CFTC chief Gary Gensler, both former Goldmanites. (Gensler was the firm’s co-head of finance.) And instead of credit derivatives or oil futures or mortgage-backed CDOs, the new game in town, the next bubble, is in carbon credits – a booming trillion dollar market that barely even exists yet, but will if the Democratic Party that it gave $4,452,585 to in the last election manages to push into existence a groundbreaking new commodities bubble, disguised as an “environmental plan,” called cap-and-trade.

 

The new carbon-credit market is a virtual repeat of the commodities-market casino that’s been kind to Goldman, except it has one delicious new wrinkle: If the plan goes forward as expected, the rise in prices will be government-mandated. Goldman won’t even have to rig the game. It will be rigged in advance.

 

Here’s how it works: If the bill passes, there will be limits for coal plants, utilities, natural-gas distributors and numerous other industries on the amount of carbon emissions (a.k.a. greenhouse gases) they can produce per year. If the companies go over their allotment, they will be able to buy “allocations” or credits from other companies that have managed to produce fewer emissions: President Obama conservatively estimates that about $646 billion worth of carbon credits will be auctioned in the first seven years; one of his top economic aides speculates that the real number might be twice or even three times that amount.

 

The feature of this plan that has special appeal to speculators is that the “cap” on carbon will be continually lowered by the government, which means that carbon credits will become more and more scarce with each passing year. Which means that this is a brand-new commodities market where the main commodity to be traded is guaranteed to rise in price over time. The volume of this new market will be upwards of a trillion dollars annually; for comparison’s sake, the annual combined revenues of all’ electricity suppliers in the U.S. total $320 billion.

 

Goldman wants this bill. The plan is (1) to get in on the ground floor of paradigm-shifting legislation, (2) make sure that they’re the profit-making slice of that paradigm and (3) make sure the slice is a big slice. Goldman started pushing hard for cap-and-trade long ago, but things really ramped up last year when the firm spent $3.5 million to lobby climate issues. (One of their lobbyists at the time was none other than Patterson, now Treasury chief ofstaff.) Back in 2005, when Hank Paulson was chief of Goldman, he personally helped author the bank’s environmental policy, a document that contains some surprising elements for a firm that in all other areas has been consistently opposed to any sort of government regulation. Paulson’s report argued that “voluntary action alone cannot solve the climate-change problem.” A few years later, the bank’s carbon chief, Ken Newcombe, insisted that cap-and-trade alone won’t be enough to fix the climate problem and called for further public investments in research and development. Which is convenient, considering that Goldman made early investments in wind power (it bought a subsidiary called Horizon Wind Energy), renewable diesel (it is an investor in a firm called Changing World Technologies) and solar power (it partnered with BP Solar), exactly the kind of deals that will prosper if the government forces energy producers to use cleaner energy. As Paulson said at the time, “We’re not making those investments to lose money.”

 

The bank owns a 10 percent stake in the Chicago Climate Exchange, where the carbon credits will be traded. Moreover, Goldman owns a minority stake in Blue Source LLC, a Utah-based firm that sells carbon credits of the type that will be in great demand if the bill passes. Nobel Prize winner Al Gore, who is intimately involved with the planning of cap-and-trade, started up a company called Generation Investment Management with three former bigwigs from Goldman Sachs Asset Management, David Blood, Mark Ferguson and Peter Hanis. Their business? Investing in carbon offsets, There’s also a $500 million Green Growth Fund set up by a Goldmanite to invest in green-tech … the list goes on and on. Goldman is ahead of the headlines again, just waiting for someone to make it rain in the right spot. Will this market be bigger than the energy-futures market?

 

Oh, it’ll dwarf it,” says a former staffer on the House energy committee.

 

Well, you might say, who cares? If cap-and-trade succeeds, won’t we all be saved from the catastrophe of global warming? Maybe – but cap-and-trade, as envisioned by Goldman, is really just a carbon tax structured so that private interests collect the revenues. Instead of simply imposing a fixed government levy on carbon pollution and forcing unclean energy producers to pay for the mess they make, cap-and-trade will allow a small tribe of greedy-as-hell Wall Street swine to turn yet another commodities market into a private tax-collection scheme. This is worse than the bailout: It allows the bank to seize taxpayer money before it’s even collected.

 

Cap-and-trade is going to happen. Or, if it doesn’t, something like it will. The moral is the same as for all the other bubbles that Goldman helped create, from 1929 to 2009. In almost every case, the very same bank that behaved recklessly for years, weighing down the system with toxic loans and predatory debt, and accomplishing nothing but massive bonuses for a few bosses, has been rewarded with mountains of virtually free money and government guarantees – while the actual victims in this mess, ordinary taxpayers, are the ones paying for it.

In short: trillions are at stake for Goldman as long as the "fight" against global warming continues. And as noted above, cap-and-trade is going to happen or "something like it will" - Goldman's future revenues depend on it.

In fact, the only thing that can crush this finely orchestrated plan to generate billions in private profits from the mass euphoria to "save the planet" funded, naturally, entirely by the taxpayer, is a critical piece of evidence that the data and statistics behind "global warming" has been fabricated,  something which very well may have occurred had Abbott's plan for an audit gone too far.

And so Abbott suddenly became a major liability, if not so much for Australia, then certainly for Goldman Sachs.

In retrospect, while Abbott completely unexpected exit on September 14 was a shock, his Prime Ministerial replacement should come as no surprise at all: Malcolm Turnbull, as we noted, just happened to be Chairman of Goldman Sachs Australia from 1997-2001. The same Turnbull who was deposed as opposition leader in 2009 over his support for a carbon tax and an emissions trading scheme, a "scheme" that, when fully implemented, would lead to huge monetary windfalls for none other than Turnbull's former employer: Goldman Sachs.

So was Goldman the responsible party behind Abbott's ouster? One can only speculate, however one thing is certain: any concerns and fears of "probes" or "audits" into Australia's global warming "data and statistics" are now history.

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ABC's full FOIA revealing Abbott's probe of BoM "data" below: