Norway Tries to Reconcile Oil and Environment

Happy Hump Day!

As I read the news, I had the most wonderful flashback to a more innocent time in my life.  It was when I could just hop on a plane with no mask, party my ass off in a foreign country, and be back in time for work on Monday.

Glory days well they’ll pass you by

Glory days in the wink of a young girl’s eye

Glory days, glory days

Let me take you up North, where the air is fresh, the scenery is pristine, and the beer is damn expensive!

“Put it back on the wall.”

I was shockingly hungover when I got that message on my mobile phone.

Travis, Will, and I, LBS classmates, decided to take a trip to Oslo in 2004, two years after we graduated. 

We had flown from London, hopping the North Sea and landing in Oslo on a Friday night. 

Stupidly, we took a taxi into town which cost about $300. No shit.  Pro tip: take the train into town from the airport. It’s a long, long drive. 

It was late August.  Oslo is gorgeous, pleasant, and temperate at that time of year. We loved it.

We couldn’t believe how expensive beer was, though. It was £10 – that’s British pounds, not dollars – for a schooner, not even a whole pint. A schooner – though they’re called that in Australia, not Norway – is about three-quarters of a pint.

Incredibly expensive beer, but we didn’t care!

We decided to live it up a little bit and have wonderful nights out on the town.

And boy, did we!  We ate and drank to excess, par usual.

So Sunday, before we were due to leave, we decided to walk around the museums to get rid of our hangovers.  That’s something I often do in Europe.

There I was, staring at The Scream by Edvard Munch.

Honestly, it’s a couple of swirls of paint to me.

It didn’t impress me all that much, but I received a fateful text message.

In those days, texts came in on my Nokia.

My buddy, Malcolm, wrote from London: “Put it back on the wall.”

I always thought the timing was spectacular. I cracked up as I looked at the screen, and I wrote back, “How did you know I’m staring at this right now?”

And he wrote back, “Haha.”

I thought nothing of it as I was wandering around aimlessly in the museum, trying to get rid of my headache.

We left Oslo that night.

The following day, I had to get up early to go to work.

On the Tube, I read the Metro that morning.  It’s the free newspaper everyone reads if they aren’t on their iPhones (iPods back then) or didn’t bring a book.

As I was thumbing through it, the headline read “The Scream Stolen in Oslo.”

I was shocked. I was standing right in front of it, and suddenly Malcolm’s text made sense.

I didn’t realize there were four Screams in existence; Munch had painted two and did two of them in pastel.

The Munch Museum version was getting stolen by armed robbers as I stared at another one in the National Museum.

I always tell that story whenever I talk about alternative investments with my students because art is an integral part of that asset class.

But instead of that, I’ll talk about Norway and its rather odd relationship to the environment. 

Their Biggest Concern is Climate Change

For those of you who aren’t following Norwegian politics, and I imagine there aren’t many of you, Norway has just elected a center-left government, throwing out the conservatives for the first time in eight years.

The pendulum swings as always.

But the funny thing about it is the Norwegians, who have made their entire wealth off North Sea oil and now possess the world’s largest sovereign wealth fund as a result of it, have thrown out their government because they’re concerned about climate change.

Source: https://www.swfinstitute.org/fund-rankings/sovereign-wealth-fund

You can’t get any more ironic than that.

That’s not because I believe that Norwegians are dirty and polluting the world while sitting there pretending to be social justice warriors, far from it.

But I think this is an interesting problem that we all face. 

If you genuinely believe that the Earth is in trouble, you’re going to have to self-sacrifice some of your economy.

The incoming Labor Government, as they’re called in Norway (translated into English, of course), has already said they’re not ready to gut the oil and gas sector.

Of course they’re not, because it’s 20% of Norway’s GDP and 10% of its workforce.

They simply couldn’t do that, and it would be silly to do that anyway because the world still demands loads of oil even in these not-so-great economic times. 

Nevertheless, the number one point on the political agenda for most Norwegian voters was climate change and environmentalism.

If you’ve been to Norway, you can see how pristine and gorgeous the place is, and I love it.

But I wouldn’t live there even if I had a second passport because the taxes are so incredibly high that it would destroy the income I’d earn.  And I wouldn’t be living there long enough to benefit from the state largesse, nor what I want to anyway.

But I think you’re going to see a lot more of this in the future.

We’ll Always Have Paris…

Rightly, Donald Trump pulled America out of the Paris Accords because the onerous requirements to cut back on fossil fuels affected the United States immediately, but did not affect China, India, and other developing powers.

It’s weird to call China a developing power even though it’s the world’s second-largest economy. 

But despite their high-speed rail network, really only half the country is developed: the Eastern half.

India has a long way to go to become fully developed.  I’ve been there nearly a dozen times. 

There are a lot of very, very poor parts of India.

But those countries are not subjected to the onerous requirements of the Paris Accords until 2030. 

Their governments were unwilling to make any sort of sacrifice in terms of development by forsaking any kind of energy source. 

So the next time you hear all those evil Western governments taking over the world, point out that Norwegian voters took the high road.

At least they have tried to reconcile their environmentalism with their actions. However, their government has already pledged not to follow through entirely.

It’s funny how the Norwegian government, who technically owns these resources, need to restrain their voters from hindering their economic endeavors.

With that, I leave you to have a fantastic day today!

All the best,

Sean

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