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In this contributed article, New South Wales producer George King argues that carbon markets are shifting wealth away from family farmers. Mr King is also on the Cattle Australia board. Opinions expressed in this item are his own.
In 1933 the United States went away from a gold standard for its currency detaching the monetary system from physical gold. With a fiat currency back by sentiment alone the credit culture was set loose.
In 1944, forty-four countries met and agreed on the Brenton Woods system of pegging all their currencies to the US dollar with the dollar once again being backed by gold at a rate of $35 /ounce. No reserve ratio was set as to how many dollars could be created for each unit of gold.
On the 15th August 1971 the Brenton Woods system was overwhelmed and President Nixon decreed the USD was no longer convertible to gold. Instantaneously every currency in the world became paper fiat currency.
Money is no longer the value of goods traded, it is the value by which they are traded. One of the only true physical assets in the world is farmland, it will provide shelter and sustenance and a constant source of multi-generational wealth creation through capital appreciation.
As it is an asset rich and cash poor business, the families which have survived the generations have been forced to live within their means instead of pursuing costly passions beyond the income of a season and commodity driven business.
The temptation to get into a too-good-to-be-true scheme is too much for many. Selling carbon is leaving yourself wide open to the liability of having to repay that carbon at a much higher rate at some time in the future. Speculating the future of your farm on being able to hold carbon in the soil in an unknown future of crippling bureaucratic rules, droughts, invasive species, a disease outbreak and irrational policy changes.
Danger in futures markets
Soil carbon has up to $160 per tonne value per year to a farming business, selling it at the current glass-bead prices may see you operating in a futures market which writes its own rules.
Perhaps even worse, farmers are going into a dark alley chasing corrupt money when selling carbon. It is a fugazi, trading an invisible natural gas which is critical to all life on earth and has limited GHG properties compared to water vapour.
If Carbon was a problem we should stop emitting it, anything else is arguing at what speed we should drive the car of humanity off the cliff at. The world stopped the production of CFC’s (Chlorofluorocarbon) propellants in the late 1980’s due to its ozone depleting effects.
Now you can emit as much carbon as you could possibly want as long as you pay a ‘carbon tax’, the money you spend on carbon schemes may be used to protect a forest which was never going to be cut down, or to lock up farmland so it can burn twice a decade, to have good farm lands degraded so as to get a ‘low’ baseline and then brought back to where they were, to pay for fires in the Top End which were going to be lit in any event, to destroy the fabric of outback communities by locking up land and displacing farming families, the list goes on.
The carbon trading schemes are a great tool for the commercially sophisticated to transfer ownership of real wealth to themselves
Discussing Carbon reductions at a global level is ludicrous whilst the developing nations are bringing their people out of poverty with carbon emitting energy.
The logic of Carbon Trading is so flawed it is embarrassing. One party says it will ‘store’ Carbon in trees or in the ground while the other party emits the same amount of Carbon? No Carbon is reduced it is just shuffled from one side of the spreadsheet to the other creating unearned and mostly corrupt money with zero environmental benefit.
Net-Zero is an apt term for this scam. The concentration of Carbon in the atmosphere is about 0.04 percent, if this level fell to 0.02pc there would not be enough plant food to sustain agriculture. Populations would starve to death and cause endless environmental destruction in the process. No environment is going to be fixed at the atmospheric level, this work can only be done at the soil level.
Farmers control some 80pc of the land mass with family farms accounting for 90pc of farms and the remaining 10pc being corporates.
The carbon trading schemes are a great tool for the commercially sophisticated to transfer ownership of real wealth to themselves and in doing so turn multi-generational farm owners into peasant farmers.
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