Automation: The demise of the low skill worker?

Image Credit to: workingtropes.lmc.gatech.edu

Image Credit to: workingtropes.lmc.gatech.edu

Over recent years the mix of our labour force has changed dramatically as manufacturing moved aboard and technology replaced many roles. The problem of what to do with low skilled workers in the face of technological progress is a daunting one. The Economist recently restarted the debate again with this article and the issue has been furthered discussed at Davos , whilst technology such as drone usage for deliveries creates employment in monitoring and servicing that technology the lower skill delivery jobs suffer. This is especially apparent in the grocery industry. Job numbers have declined for frontline low skill workers as self-service and “scan as you shop” terminals are introduced requiring less on-the-ground support. As we see the further introduction of automation to frontline services such as robot check out assistants or window cleaners there will be a deficiency of traditional roles for those workers. Robots are improving some workers productivity such as in the Amazon distribution centres but how long is it before the machines replace the workers? The technological progress that removes some basic jobs such as bank cashiers  can also create more new roles in the form of phone based customer service jobs for online banking. While there are sure to be some roles created by the progress there will not be enough. How do we handle this fundamental shift?

We cannot simply enrol these individuals into the benefits system this is unsustainable – the experience of France shows that there is a level at which taxing the rich to provide for the rest just stops working. Retraining will work for some but not everyone will be suited to new roles, servicing and supporting technology, and there will just be fewer jobs in total leaving many without a form of gainful employment. Even skilled jobs in the low end of logistics will take a hit as big data radically reduces the need for multiple individuals to work. Initiatives such as Amazons anticipatory shipping  and fully automated warehouses will reduce jobs still further. Adaptation is a fundamental human strength and it is what we must do to ensure jobs for the future.

The last Labour government was relaxed about the loss of manufacturing jobs to China talking about how the UK would become a “knowledge economy” but we never adjusted what goes on in schools to match that. Now we could consider regulation on Corporations and the economy to try and minimise the damage to low skilled workers as an option. The UK should implement careful educational management to curtail much of the effect of automation. Specialist education for those unsuitable for the professions must begin early in the school journey and people should stay in some form of education (even part time) until they do reach some minimum literacy and numeracy standards. Benefits must also be radically reformed, current cuts are not enough and to remove dependency there really needs to be no real alternative to taking employment. There cannot be the situation where the difference between working every day and not working is an insubstantial sum. Paying someone for nothing doesn’t make sense, if benefits are to remain at current levels then those that receive them need to be mobilised back into the economy. We really shouldn’t have the situation of thousands of low/unskilled vacancies having to be filled with migrants. We shouldn’t have reports from employers that young school leavers do not have the ‘grit’ to succeed and lack ‘basic skills’. Optimising the output of our current population would be very beneficial in welfare savings and would also improve feelings of self-worth. This is not to say that migration does not have a place, it is after all incredibly useful in filling vacancies such as those in our tech industry.

The solution may seem simple but it is complex, optimise education as we have begun to optimise every aspect of our lives. Use big data analytics to shape children’s educations providing alternative learning methods to best utilise their cognitive abilities. Unless we begin to look at how we might do this now for the future the effects on our future will be as damaging as the pension black hole I have previously blogged about. However, I fear that the short termism of our political system will not enable this to happen in time.

Historically technological progress has eliminated jobs but also created a raft of new ones. This trend will continue but it will not be in the unskilled labour market.

In 20 years do I think I will be hitching a ride in a driverless car and paying for it via some infrared laser beam shot from my eyes via google glass or a contact lens? The answer dear reader is no.

I do not believe that the future will become so bleak in the predicted 20 year time frame as such predictions are more unreliable than weather/economic forecasts. We haven’t even got a half decent phone signal; (3G or H+) throughout the UK yet (ask anyone that lives in the Home Counties!) and are yet to see fibre introduced to all homes. Driverless cars, though an exciting technology are unlikely to reach the level of penetration that puts multiple drivers out of work for many years due to cost, approval and required improvements. Even self-service checkouts first introduced in the 1990’s have not ousted the traditional check out assistant because well, they don’t always work effectively! Yes technology is advancing rapidly but the rate it disseminates into our lives is far slower. It is worth taking this as a warning, to continue economic growth and succeed on the global stage we need to have a mobile, skilled, useful and employed workforce! I think the real threat to low skilled work and subsequently higher skilled work is further off than is currently predicted because really automation can really benefit some industries but ruin others… I mean don’t you just hate automated call centres?

south-african-flag

A few people have asked me to blog on this topic because I have studied South Africa, its development and politics, the ANC and Mandela and can provide a deeper analysis than commentators who just read the news on South Africa occasionally or have read “The long walk to freedom”. My interest started whenI first visited the nation and has been furthered over another 4 visits.  This post is directed at addressing the questions surrounding the future of South Africa post-Mandela. Whilst some might say that the post-Mandela era began in 1999 when he left power I believe that the ANC has been reliant on the ‘myth’ and sentiment surrounding Mandela and this rather than policy has been central to the ANC’s continued electoral dominance.  With Mandela’s passing I do hope that South Africa will be able to look towards the future and thus fully deliver much of the vision laid out by Mandela on the night he was elected in 1994 to “…begin to build a better life for all South Africans. This means creating jobs, building houses, providing education and bringing peace and security for all”

The following information is not an attempt to demean Mandela’s achievements or those of the ANC in ending Apartheid, just to indicate my criticism of how the country has been governed since the radical transformation of Mandela’s initial term as President.

The ANC played a vital role in ending Apartheid and indeed establishing some semblance of stability and reconciliation after the system fell. However, it was this exact same importance that has led the country down the wrong path. The precedence that the ANC gained from being the party that ended Apartheid caused in my opinion negligent handling of the country after Mandela’s term. The ANC essentially crafted a single party state where their share of the vote did not drop below 60%. With the one party state the only performance benchmark was to outperform the conditions seen under Apartheid. Those in power had no real experience at any stage of the legislative or bureaucratic process and this created a wildly optimistic legislative agenda with no real progression of goals and additionally created an environment that was ripe for corruption. Corruption may be the single most damaging issue for South Africa as the R30 Billion that is lost annually equates to more than South Africa’s annual education budget. Corruption has also increased the cost of goods by as much as 20%.

The ANC has been riding the coat tails of Mandela’s success for far too long. Even last year, this video shows how desperate ANC is to continually associate itself with Mandela. The aura of Mandela has sustained public approval following events such as Zuma’s rape trial, the Marikana massacre and the lack of delivery of services. I think most people agree that it was a clear propaganda piece.

It is my belief that with the passing of Mandela South Africa may be able to move beyond the ANC and look to a different party or parties to be able to finally tackle the country’s problems.  For years other parties have campaigned but have failed to gain wide support; 13 other parties are represented in Parliament. The country may now consider a wider range of parties and select the best candidate and not just vote for the ANC.  After all when looking at the track record of President’s Mbeki and Zuma we see that their terms in power were shadowed by economic failure, corruption, one of the most expensive yet least effective education systems in Africa, AIDS denialism and failure among other things to tackle the scourge of rape and violence against women. Of course these things existed under Apartheid but it is shocking is how prevalent they still are today. The ANC today does not consist of the nations’ most talented but of those put there by cronyism. Additionally some of Mandela’s great work for tolerance and understanding in race relations has started to become undone following the damaging example of Zuma who sang the controversial ‘shoot the Boer’ song  which however you try and justify it is at least incredibly inappropriate for the leader of a country with sensitive race issues to be singing.

Mandela once said that freedom from poverty was “a fundamental human right”, without going into the semantics of ‘rights’ we could say that measured by this statement South Africa has a pretty dire human rights record. The ANC has done little to lift its people out of poverty and has implemented successive initiatives that have each individually failed. South Africa’s Gini coefficient measure of inequality is 0.62 in 2012 up from 0.49 in 1975 under apartheid. To add some context a Gini score of 0 is perfect income inequality whilst 1 equates to total inequality.

Whilst Mandela’s role in ending Apartheid and leadership of the country were truly monumental, the continued reliance of the country on him and the ANC has been immensely damaging. I believe that with Mandela’s death, very sad though it is, that the country may feel able to look towards alternative parties to balance the excesses of the ANC and provide new ideas and leadership that may help it address challenges such as high unemployment, which is  broadly about 25%, even estimated to be as high as 50% in some studies. South Africa may have a bright future ahead of it, but only if the ANC becomes a part of that future and not the sole director of it.

A bright future? The post-Mandela challenges for South Africa

The Age of Irresponsibility

Image Credit to: Empireofthekop.com

Image Credit to: Empireofthekop.com

Recently I wrote about the decline of America as a Superpower. This post is about another type of decline, that of our individual sense of responsibility. In the UK we have a blame culture when people do not accept the consequences of their decisions and instead blame the government for their failings. This ‘weakness of self’ is perhaps best evidenced by nutrition policy. Corporations such as Morrisons, Subway and Nestle have signed up, under public pressure, to a voluntary ‘responsibility deal’ between industry and government. This deal means that suppliers will reformulate products so that they include less saturated fat. I applaud this decision, but I despair that the government has to create such measures. Individuals are acutely aware of what is healthy and what is not. Even if a survey of 2,000 people for Sainsbury’s found 84% of those questioned did not know how much saturated fat was a healthy amount; individuals still know it isn’t good for them. Nutritional information is also readily available on every packet of food; the front of food packaging has a colour code showing the health information and how much of your daily macronutrient allowance it contains.

We have freedom of choice, risks are known and we can consider those risks and make an individual decision. Of course if something is severely risky or dangerous it should be banned. But is taking the risk out of so many decisions healthy for the public? No, because by doing so you encourage an ignorant and apathetic society. The measures introduced in the ‘responsibility deal’ may save 2,600 premature deaths according to Department of Health. Is there really any hope of ‘saving’ people who lack the self-discipline to stop making an expensive, unhealthy choice to eat so badly that they shorten their lifespans? The statement that manufacturers are trying to ‘save face’ with the responsibility deal is repugnant because it absolves individuals from making reckless choices that can harm them. People are not ignorant about the issue of health, if they are making unhealthy choices they are doing so knowledgeably, because there is enough information out there. Manufacturers of unhealthy food cannot by law claim it is healthy and don’t try to.

Consumers have a great deal of power to direct the market, if they stop buying chocolate biscuits because they are high in saturated fat the food industry will respond by reducing it. Such measures don’t affect the majority, but the idiotic minority who eat enough If you cannot be bothered to take responsibility for your own health its unlikely that you are responsible in any other way. It is for this precise reason that obese families often have obese pets (incidentally something that amounts to animal cruelty) because as they cannot take responsibility for themselves they cannot be responsible enough to care appropriately for an animal.

A similar rationale can be applied to proposals to make cigarette packets less desirable by hiding them behind a screen and covering 75% of them in warnings. I see no reason for doing this, everyone knows that smoking is unhealthy and can cause everything from emphysema to lung cancer. At some point there has to be responsibility on the part of the individual to not smoke or accept the consequences of the action.

It is governments purpose to provide choice not force people down restrictive paths. I contend that the risks are known and that government and corporations are doing their bit, it’s cheaper and healthier to not each so much processed food and it’s good to exercise. Failure to do so when you know the risks is pure negligence.  We do not need to a ‘responsibility deal’ between government and industry but we do need a deal between the people of this country and the government that we will finally accept the responsibilities of our actions. Describing the deal as ‘a drop in the ocean’ is inaccurate, it is not companies that need to change it is the individual consumer and our attitude towards heath.

The US Deficit Ceiling and Reputation

Image credit to: Realityfail.com

Image credit to: Realityfail.com

Deficits are a natural part of running a country. In a similar manner to personal finance you borrow to fund improvements and then you service the debt you incur at with interest over a given period until the capital is repaid using surplus cash or a new finance instrument. Now the US debt ceiling has had global attention in even the mass news media in recent weeks with its partial shutdown of all but essential components. Yesterday the shutdown ended but it highlights a problem with the way the US is ‘doing business’.

 
How have debt patterns developed in USA and UK?

This is just a sticking plaster on top of a much larger festering wound. Governments both the US and our own have been letting our debt build up for far too long. http://www.davemanuel.com/history-of-deficits-and-surpluses-in-the-united-states.php shows that in the early 1900′s there was a fairly short turnaround between deficit cycles and surpluses. This is a responsible way of managing debt where improvements are made responsibly and without as many of the adverse effects on the wider country. As the 20th century progressed we see that the cycle gets longer, deficits year on year running from 1970 to 1997. The past decade has seen a huge deficit with it growing from $157.8 Billion to a massive $1100 Billion in 2012. The national debt has been slowly increasing not just in numerical terms but as a percentage of GDP. The problem is mirrored in other western nations to greater or lesser extents. Part of the explanation behind this problem and rising costs is social and the other part political. The public continue to expect more and more in terms of services and benefits and no increase in tax payments which is in itself rather unrealistic.

Politically the problem stems from reckless decision making driven the the need to won votes in the face of elections. How do you make the public understand that although they pay taxes in most cases these don’t actually cover off the bill for services they use. For instance some 60% of households in the UK are net recipients from the Treasury and I am fairly sure few of them realise this. This alongside inefficient spending and a failure to upgrade key infrastructure at the correct time e.g. Power generation  is now resulting in higher expenditure.

What does this mean for the US as a Superpower?

Many are asking what this particular event means for America on the global stage. A Superpower is defined as “an international governing body able to enforce its will upon the most powerful states”. This inability to manage its internal affairs calls and enforce an internal will calls into question its ability and competence to be dealing in international affairs. I mean you wouldn’t ask the guy who barely manages to pay his bills for advice on your own money nor would you put him in charge of important business. Of course that metaphor is overly simplistic but it still stands. Other global players are asking how a dysfunctional political system can come within a day of severely damaging the global economy. This has dealt another severe blow to the American reputation on a global stage and builds on the legacy of issues from Iraq and Syria.

Not only is this embarrassing on an international basis it is causing a breakdown of trust at home. Only nine percent of ‘Likely Voters’ have consistently rated the way Congress is doing its job as good or excellent throughout Obama’s term, this measure subsequently fell to 5% saying they support the decisions being made by government leaders. This 5% is slightly more Americans than earlier this year said they believed lizard people controlled the US government  as Politico’s Jonathan Allen has pointed out . An overwhelming 83% were rated as disapproving of their leaders according to the a recent poll.

How might this affect our future?

Historically the dollar has been the default global currency due to the position of the US as a Superpower. The World Currency is now speculated to include the Chinese Yuan and the Euro within a decade. The debt-ceiling crisis has led to renewed calls for the dollar to be fully or partially replaced due to the effect US domestic political instability can have on the borrowing costs of smaller nations. Many Central Banks have 60% of their reserves in dollars and so having that much of your savings subject to political brinksmanship combined with the fact that the Federal Reserve is a private bank is a real cause for concern. It is embarrassing for the US to have lost Foreign Affairs and Economic credibility in recent week to its rivals Russia and China. The one advantage the US had is that its debt was considered golden, with its ability to make interest and other repayments unquestioned whilst China was ‘untrustworthy’ this recent development has certainly damaged Pax-Americana and the American way of operating. Now of course there has been speculation that the US role as a Superpower has been on the decline for a while, often the US has proven those skeptics wrong but it will be interesting to observe how the US tackles these new challenges.

Chinese companies are being courted by the UK for investment in infrastructure projects and other companies. It is also important to understand that in September 2008 China replaced Japan as the biggest single foreign creditor of the US federal government. The US administration estimates that the China government holds at least $1.3 trillion of its bonds. However it is worth noting that China needs the US to fuel its growth with the foreign debt holdings stabilising the renminbi at an artificially low rate. China will continue to support its largest trading  partner in regard to debt. The economic relationship is one some have described as almost co-dependent. The transition of power on a global stage was historically effected with military power through invasions and through war, but in the 21st century it is perhaps economists, investors and bankers who control that transition through financial invasion rather than commanders and generals.

The rise of Twitter Terrorism – Terrorism PR in the digital media age

images

In the past week we have seen two devastating attacks carried out by Islamist terrorist groups on the African continent. This post aims to shed some light upon why one hit the headlines and one was merely reported upon. There are key differences that make one a story hit the headlines globally. One attack was carried out by Boko Haram the other Harakat al-Shabaab al-Mujahideen who are more commonly known as Al-Shabaab. Terrorism has three objectives; to communicate a set of beliefs, religious, political or ideological, to generate fear in the public and to influence government actions and policy. This post shows how targets, method and social media all aid in communicating a groups agenda.

Targets designed to generate ‘shock value’

Stories get traction because people can relate to and resonate with the events or message. Fear is most acute when you believe you, or those close to you, could have been caught up in the events or those affected are completely innocent bystanders. The attack by Al-Shabaab that targeted members of the expat community in conjunction with native Kenyans generated more media traction than Boko Haram’s slaughter of native Nigerians. The reason is that people are less affected by tragedies far from home. Statistics seem appear as cold numbers and whilst a report on the numbers of girls involved in sex trafficking shocks it does not produce an uptake in news while a kidnapping of a small child who is native to our own country and could be a victim of trafficking causes far more of an impact. This effect is evidenced by the story Madeline McCann, we can easily relate to her family and this impacts the public consciousness far more than just numbers. The same is true in these attacks with Boko Haram’s estimated 89-159 native Nigerians achieving but a fleeting mention in comparison to 68 killed and reports of 39 taken hostage in the Al-Shabaab attack. The addition that 4 of the deceased are British immediately fuels the uptake by the media because we can relate to those British people in plight more effectively.

The targeting difference between the attacks is remarkable as by choosing an Israeli owned centre and letting the Muslim hostages go it brings more Western attention to the event. Such a hostage situation ensures that their ideological message is clearly on the agenda, along with their opposition to Kenyan involvement in Somalia for longer.

Methods in the attacks to increase exposure

Another difference between the attacks is the methodology. Boko Haram dressed in military uniforms and stopped cars acting in an official manner before starting their slaughter and then left. The attacks were intended to generate fear in the local community and as a show of strength but also the militants were always intended to escape. Al-Shabaab’s attack focuses on a heavy traffic area of a population centre and on holding it for a protracted siege with escape unlikely. Whilst both groups are Islamist in nature it is interesting to see that Al-Shabaab has adopted ‘martyrdom’ as part of its cause. This method is purposefully designed to get a larger media ‘audience’ as developments are fast moving, ongoing and very easy for outlets to run stories on. You tend to find with this kind of attack that the media provides almost saturation coverage, an example of this is 9/11 when afterwards there were entire editions of papers dedicated to the attacks. From the Al-Shabaab attack we see outlets producing huge features in conjunction with the original reports, comment pieces and content the history of the group http://www.bbc.co.uk/news/world-africa-15336689 these can almost be seen as ‘easy column inches’. To give an example of the difference in media uptake a news search for Boko Haram this week (on Sunday 22nd September) gets 6 pages of results on Google news, meanwhile Al-Shabaab gets 9 pages after only 24 hours.

I am also aware that I myself am perhaps perpetrating the same thing by commenting on the event, however there is a slight difference in that I am seeking to explain why there is such an interest in this terrorist attack verses another less well known one.

Social Media Use by Terrorists for Propaganda and Promotion

Both groups use social media, Boko Haram allegedly using https://twitter.com/BOKO_HARAMM it is not possible to ascertain whether the account is genuine. Al-Shabaab meanwhile actually set up an account termed the HSM Press Office (which has since been suspended). Al-Shabaab actually tweeted live during the attack generating an audience far more quickly than the Boko Haram attack. We are increasingly seeing terrorists turning to social media in a phenomenon that will no doubt soon be dubbed ‘Twitter Terrorism’. Recently on Facebook page of Tehkreek-e-Taliban Pakistan (TTP) there were job adverts requesting content creation skills such as video-editing, translating, sharing, uploading, downloading and collection data collection. Terrorists have always been fairly good at planning attacks for maximum coverage and now have fairly robust online presences that authorities and the internet providers will have to tackle. The fact that Al-Shabaab named their account HSM Press Office is a chilling reminder of how PR can be used as propaganda for malicious purposes. In a chilling echo of PR practice reporters received an email from the group’s press office informing them that they could now follow events on the new handle @HSMPress. (On a side note the above TTP organization killed at least 78 Christians and wounded 120 in Pakistan with two suicide bomb attacks, there is again a huge difference between how we relate to attacks with the TTP attack receiving coverage on page 19 of today’s Metro and scant coverage)

Some organisations now have dedicated Social Media wings, Jamaat-ud-Dawa a religious organisation that allegedly had a role in the 2008 Mumbai attacks being an example. Authorities are catching on to Twitter use as a way to counter groups (it was used to arrest almost 40 leaders from the April 6th movement in Egypt) but if certain providers and domestic governments do not help there is still a platform from which they can preach.

The CNN Effect

24 hour news coverage of a protracted attack now works in conjunction with Social Media to ensure that we are always connected to events in a way we never have been before. Twitter has been the rallying point for revolutions, riots and now sadly now terrorism. The immediacy of events puts pressure on governments to respond or appear weak and indecisive. Despite cynicism that Twitter can be a useless medium for the daily mutterings of peoples lives it really has changed the world and the way we interact with it. Twitter can be a positive force or an incredibly negative one, the recent NASDAQ index was seen to plummet following a hack on the Associated Press twitter account that claimed there had been an explosion at the White House. I am sure that key influencers have protected their accounts with passwords that are probably more secure than something like ‘AssocPress1′. The pressure on the Kenyan government has increased because of the ‘CNN Effect’ and you can be certain that every agonising detail behind the siege will be played out directly to TV, PC, tablet and smartphones around the world.

Now I hope nobody misunderstands my intentions in this post, I in no way condone political violence or terrorism and my sympathies go out to the families affected. I myself thought I was at risk during what turned out to be a bomb threat the day France banned the veil. I was in Paris on the Eiffel Tower which was evacuated by the military and elite troops. I would never wish anyone to experience a similar event. I hope the situation is swiftly resolved with the minimum casualties.

Why we need a Fracking Sovereign Wealth Fund

Fracking Image: Credit to Vancouver Sun

Fracking Image: Credit to Vancouver Sun

Edit (additional Comment): Some have pointed out that Norway has a smaller population and greater mineral capacity than the UK and while this remains true I merely wished to iterate that even a small Sovereign Wealth Fund from shale revenues would be more beneficial in my opinion than disseminating funds locally. Some of the smallest SWF’s are worth a few billion and it’s likely that a fracking related one would be mid-range in terms of SWF rankings. I still believe that even a small fund would be the best route.

Recently the debate around shale gas has been raging.  The debate is incorrectly focused; shale is good for the economy, better for the environment than some of the alternatives and has manageable or negligible risks. The fact is shale gas has fantastic potential and what we really need to discuss is how we utilise the money we derive from shale.

Observing worldwide trends for utilising mineral wealth it is apparent that some countries do it right and others do it very, very wrong.  The UK is sadly a prime example as we squandered the revenues from North Sea Oil.  If only we had done the smart thing and followed Norway’s example, we would have a Sovereign Wealth Fund (SWF) worth over £450 Billion.  Every country that has utilised a fund has had far greater success in bettering the lives of its people than those that have spent the immediate revenues in a wasteful manner through tax cuts and credits and unnecessary services.

In no way do I think that giving the affected local communities 1% of revenue is the answer.  A better solution is obvious; the creation of a SWF.  The argument is not merely compelling, it’s so utterly brilliant that if any person gives almost any other suggestion they should be roundly slapped across the face.  An SWF is a long term solution and would help negate some of the incredibly damaging short term policy we have seen in the UK over the past few decades.  The UK has been throwing money away in non-sustainable ways with no thought for its future like a gold digger (typically financial planning experts…) in a Gucci sale.

Take a look at the national debt of the UK, equivalent to £33,000 for every individual in employment, we have a public pensions time bomb and waste money in needless ways in our public sector and welfare system.

I have pointed out before the success of the Norway Government Pension Fund which has a total or $141,379 for each of its citizens.  A worst-case scenario for the Norwegian Government Pension Fund’s value in 2030 was forecast to be $455 billion with a best case scenario of an astonishing $3.3trillion – just imagine if we had done the same.  Wisely invested, we can actually multiply the benefit of our natural resources and use it in many different ways for example to support and renew our existing infrastructure, investing in the creation of green industry and renewable energy.

The UK needs to adopt a forward thinking approach as ludicrous debt levels and expenditure decisions driven by vote buying have left us at the point where it will be a struggle to get back on track.  I understand deficits are a part of economics and governance but they should not grow to such a huge extent as we currently face where soon we may be unable to service the debt.  At some point you must cut back or risk bankruptcy as a country.  Is it sustainable or sensible to run your personal finances in the same way and would you get mortgage after mortgage when you don’t earn enough to even cover the payments on one?  No, of course not.  I would accept a deficit but only one that is substantially smaller and manageable.

Borrowing to fund high levels of public spending has merely inflated expectations of benefits and services to an unsustainable level and I can show you literally hundreds of examples of local government waste.  Dissolving spending decisions to local communities is not effective and I fail to see how Mrs Banderby getting new fence posts, the local park getting a trim trail that goes unused and becomes vandalised, a new town hall or any number of a useless litany of services really benefits the UK in a positive way.

Along with the ‘Santiago principles’ of SWF transparency, we also need to consider the appropriate limitations for of use of the fund.  Effective governance of the fund is required to ensure that it cannot be squandered as some sort of ‘voter happiness scheme’ with the government announcing ‘everyone gets a free new car!’.  This is mainly because this is stupid and secondly because the government is not Oprah Winfrey.  We need similar solutions to the Norwegians where they prevent the abuse of SWF money for political gain by budgetary rulings.  These are detailed and numerous but in summary no more than 4% of the fund value can be allocated to Norway’s annual budget.  Numerous voting procedures are in place including an ethics board that ensures that no investment goes into companies viewed as unethical by most Norwegians.  This removes the opportunity for the embarrassment of a Wonga.com fiasco similar to that recently experienced by the Church of England.  Safely ring-fencing the money from political misuse can only be a good thing in my opinion.

Many of the environmental concerns around fracking can be effectively managed with strict regulation and control.  No aquifers have ever been found to have been polluted either by fluid or methane gas as a result of fracking in the United States and statistically the earthquake risk is almost negligible.  In terms of water usage fracking in the United States as a whole uses 0.3% their water supply which to put it in perspective is actually less than is used by golf courses.

Perhaps the greatest asset of shale is actually environmental, as shale gas could cut the cost of reducing CO2 seven times more effectively than wind power whilst actually helping the economy.  This usefully reduces CO2 emissions and buys us time to focus longer term renewable energy.  Environmentalists protest against the idea of all non-renewable such as coal and at the same time protest against the less damaging alternatives such as nuclear and shale.  They really need to get a grip on reality and realise that they have not provided any practical alternative.  If we invested even a small amount of the projected £6.6 Billion annual revenue into making our power more renewable and future proofing our situation then it would outweigh the negatives.

Is fracking the answer to all our debt and energy issues?  No, but is part of the wider solution.

Please look at the Infographic I created at http://garethricejones.wordpress.com/2013/08/26/fracking-in-numbers-infographic/

I would like to thank my readers as the support I have been shown is phenomenal with over 350 views from 19 different countries in a few short months.

Fracking in Numbers (Infographic)

Fracking in Numbers (Infographic)

This is my first ever infographic created on Piktochart to help educate people on some facts and estimates about fracking. I hope you enjoy!