Surprisingly, bogs are better than trees

Forestry England is cutting down trees to restore bogs in the North of England. While a bog ecosystem is not much to look at, it is amazing at storing carbon. Some of them contain plants that grew 12,000 years ago when the glaciers retreated from Northern England at the end of the last ice age. But after World War II, the UK began a huge forestry programme. Many ancient mires — or bogs — were drained to make way for trees. The key building blocks of the peatland are the sphagnum mosses that are about 90pc water, which is why bogs are better for the environment than trees. Timber can last hundreds of years, but a bog can store carbon for thousands of years. When plants die in a bog, they don’t rot completely and therefore don’t release all their carbon into the atmosphere.

(Adapted from the video “Why Cutting Down Some Trees Can Be Good For The Climate,” by BBC, published on Mar 26, 2021)

The never-ending circular debt

The continuous buildup of the circular debt, which stands at an all-time high of 5.2pc of GDP, poses a threat to the country’s energy security and consumer welfare. The average cost of producing a unit of electricity is Rs21 while less than Rs14 is recovered in cost. This implies Rs7 goes into circular debt for each unit produced. The cost-based tariff model provides a cover for the inefficiencies of the state-owned distribution companies as well as the distortions created by the power purchase agreements. Pakistan’s power sector distortions cost the economy $18bn or 6.5pc of GDP in 2015. The recent increase in electricity tariff for end-consumers is yet another wake-up call that the country’s power sector requires urgent reforms.

(Adapted from “Deconstructing Circular Debt,” by Beenish Javed, published by the Policy Research Institute of Market Economy in February 2021)

The royal business

The monarchy of England is as much a business as it’s a family. Roughly, the amount of things they own amounts to $28bn. Even though they can’t sell any of these items (such as the crown estate valued at $19.5bn), the ‘business’ very much depends on their relationship with the public and the press.

The royals bring in $2.7bn to the UK economy in different ways. The crown estate pulled in more than $700m in revenue in the latest fiscal year, of which profit was $475m. Of the profit, 25pc goes to the royal family as the sovereign grant while the remaining 75pc goes back to the British Treasury.

The sovereign grant is solely used for the public expenses of the royal family, which includes payroll, security, travel, housekeeping and maintenance costs. With a net worth of about $500m, Queen Elizabeth has the largest net worth in the family, but it is relatively small compared to the wealth connected to the crown.

(Adapted from the video “Inside ‘The Firm’: How the Royal Family’s $28 Billion Money Machine Works,” by Forbes, published on Mar 25, 2021)

The long long hours of junior bankers

Junior bankers at Goldman Sachs are losing out on sleep. A survey of 13 first-year banking analysts, presented to management, reported an average workweek of 95 hours, with five hours of sleep a night starting at 3am. Three-quarters of respondents said that the long hours made them felt they had been ‘victims of workplace abuse’. A majority of the analysts surveyed reported being blamed without justification, as well as “excessive monitoring or micromanage”. Young investment bank recruits are often expected to work very long hours in exchange for higher than average salaries and the prospect of being promoted, but the pressures tend not to be made public.

(Adapted from “Junior Goldman Sachs Bankers Complain of 95-hour week,” by Robert Armstrong, published on Mar 19, 2021, by the Financial Times)

Published in Dawn, The Business and Finance Weekly, March 29th, 2021