Avner Mandelman writes in the Globe and Mail:
I’ve said before that you are more vulnerable to skillful rhetoric than you think. Well, the past week proved it.
You’ve probably read about “Climategate” — how thousands of hacked e-mails from climate scientists revealed that they colluded to fudge their conclusions about global warming, told each other to destroy incriminating e-mails and perhaps even dumped raw data to mask the fraud.
Why did it work? Because the falsified conclusions appealed to people’s good nature, and because the conspirators co-opted above-average rhetoricians to deliver their message.
Now why am I going on about this? For two reasons: First, because global warming is an investment theme that a few brokers are pushing; so, if you are a theme investor, be careful. Second, this sort of revelation is a perfect teaching moment of the madness of crowds.
Similar irrational manias included global cooling in the 1970s (when investors were urged to invest in thermal insulation, and the like); the Club of Rome’s fear that we’re running out of resources; the Internet dot-com bubble, when insane stock prices for companies without revenues were the norm; and others of the same ilk: mass hysterias that allowed a few media-savvy promoters to take the money of the many, by preying on their credulity, their emotions or both. Like global warming now.
If you think that calling global warming an irrational mania is a bit harsh, consider this: Say that a pharmaceutical company’s researchers were caught fudging their tests to make their drug look effective; then, when found out, conveniently lost the non-fudged data. If a doctor prescribed for your child the fraudsters’ drug, would you let her take it? If you said yes, would we not be justified in saying you are acting irrationally?
This, in effect, is what’s happening now: global warming has become a near-religious test of civic virtue, just as being invested in Internet stocks became a test of investment savvy in 2000. Which is why many investors dazedly held on to Nortel all the way down to zero, even after its accounting issues had been revealed. And now, even though you can’t trust the climate change data, the Copenhagen conference still goes on and promoters including Al Gore are out begging the public to give the scientists the benefit of the doubt. This is the same Mr. Gore who is profiting from tax credit-based environmental investments.
Do you still wonder why I see elements of mass madness here?
The rest here.