On the Blog

Obama’s Security and Exchange Commission Issues Climate Chaos ‘Guidance’

Somewhat Reasonable - May 29, 2016, 10:14 PM

Government-enforced ‘climate justice’ is a good reason to be blue.

President Obama continues to use “dangerous manmade climate change” to justify a massive regulatory onslaught that will “fundamentally transform” America’s energy, economic, business, industrial, social, legal and constitutional systems before he leaves office.

The more science batters alarmist claims; the more people realize that plant-fertilizing carbon dioxide makes life on Earth possible; the more China, India and other developing countries burn oil, gas and coal and increase their CO2 emissions to lift billions out of poverty, malnutrition, disease and brutally short lives — the more the administration issues draconian climate edicts.

Almost every department, agency and bureaucrat that didn’t eagerly volunteer has been dragooned to aid the campaign — from the EPA and Agriculture, Interior, Defense and State Departments, to the Overseas Private Investment Corporation. The Securities and Exchange Commission (SEC) is the latest agency to re-up.

Pressure from climate and environmental activist groups “persuaded” the SEC to release its initial “interpretive guidance” on climate change in January 2010. It purported to help companies decide when they must disclose how their business might be affected by actual physical climate change, by direct impacts from laws, regulations or international agreements, or indirectly by effects on business trends.

In March 2016, the Commission told ExxonMobil and Chevron they had to let shareholders vote on whether the companies must explain how their profitability might be affected by climate change and laws to prevent it. Both resolutions were rejected, but proponents vowed to return as often as it takes to win.

On April 13, 2016, the SEC published a 341-page Concept Release intended to “seek public comment” on ways to modernize, improve and enhance Regulation S-K business and financial disclosure requirements for registered companies’ annual and other reports. It asks whether new specific disclosure requirements should be added to ensure greater transparency and aid investors in determining whether companies are being socially responsible, properly handling diversity and inclusion concerns – as well as adequately addressing needs and risks associated with climate change, resource scarcity and sustainable development.

Many people view these as legitimate concerns. They certainly are on the minds of certain investors and interest groups – especially CERES, Environmental Defense, and the California State Teachers and Public Employees Retirement Systems — all of which seek to advance their narrow parochial interests on climate change, “appropriate” energy, and particularly taxpayer subsidies for their favorite causes and cronies. The issues are certainly being used to drive Obama administration agendas.

However, prudent investors (as well as employees, consumers and voters) might want greater disclosure, transparency and honesty regarding the full panoply of risks associated with laws and regulations imposed in the name of stabilizing Earth’s always-unstable climate and weather … mandates, preferences and subsidies enacted to support “eco-friendly” wind, solar and biofuel “alternatives” to oil, natural gas and coal  … and campaign contributions that keep supportive legislators and judges in office.

This climate crisis edifice owes its existence to assertions that fossil fuel emissions have replaced natural forces in climate change, and any future changes will be disastrous. As those claims are further debunked, or enough voters and legislators become disgusted about the $1.5 trillion spent every year on climate crisis programs, the risks won’t come from climate change. They will come from a vengeful public.

No wonder Al Gore, Michael Mann and their comrades refuse to debate, jealously guard their kingdom, and chortle as state AGs prosecute “climate deniers” for racketeering. Prudent investors might want to study these issues in greater depth and raise a few questions that Obama’s SEC prefers not to entertain.

* As scientist John Christy told Congress in February, the climate agenda is driven by data that have been massaged and manipulated, assertions and predictions that are contradicted by Real World data and observations, and “demonstrably deficient” computer models that predict global temperatures way above what have actually been measured, and cannot even reproduce past temperatures. Climatology remains an immature science that cannot even explain major historical climate events, much less predict the future.

Those problems are compounded by phony “hockey stick” temperature graphs, ClimateGate emails, once reputable scientific journals rejecting papers that contest climate catastrophe claims, and headline-grabbing disaster “studies” that are based on rank speculation or written by environmental activists.

Are the alleged physical impacts of climate change real, or merely generated by computers and activists? Are they due to fossil fuels, or to natural forces that have driven climate and weather throughout history?

* Regardless of how much the United States, Europe and other developed countries slash their fossil fuel use and greenhouse gas emissions, developing nations will continue using those fuels at a feverish pace. Atmospheric CO2 concentrations will thus continue to climb beyond the 400 ppm (0.04%) level. Job losses, reduced living standards and countless other sacrifices by Americans, Europeans, Canadians and Australians — especially by poor, working class and minority families — will not affect this trend.

Will we even be able to detect the effect of developed nation sacrifices on Earth’s climate, against normal, natural fluctuations? Why aren’t we measuring the harmful effects of anti-fossil fuel laws, regulations and treaties? How are these policies and actions moral, socially responsible or sustainable?

* Many positive profit projections and other indirect benefits to business trends are based on assertions that manmade climate chaos is real and massive subsidies for renewable energy will continue. Negative effects on profits and corporate reputations are assumed to result from associations with fossil fuels.

But if governments begin to reject climate alarmism or eliminate mandates, subsidies, guaranteed loans, feed-in tariffs and exemptions from endangered species laws, companies built on this house of cards will collapse. A number of EU and Chinese wind and solar companies have already gone belly-up or lost up to 90% of their market value, as demand for their products waned. Meanwhile, companies now vilified for producing or using fossil fuels that sustain our economies, jobs and living standards would benefit.

Coal, oil and natural gas still provide over 80 percenet of all US and global energy. Largely because of abundant natural gas produced via fracking. US CO2 emissions declined in 2014, while the EU’s rose 0.7 percent.

Shouldn’t wind turbine companies have to disclose that generating just 20 percent of US electricity with wind power would require some 186,000 turbines, 19,000 miles of new transmission lines, 18,000,000 acres of land, and 270,000,000 tons of concrete, steel, copper, fiberglass and rare earths, plus millions of dead birds and bats every year? Is that sustainable?

Shouldn’t insurance companies and reinsurers have to “disclose” that their higher rates and profits are based on 20-foot higher sea levels and more violent hurricanes conjured up by bogus computer models? Doesn’t that amount to deceptive advertising, fear-mongering and corporate social irresponsibility?

* If President Obama and the SEC are going to demand full disclosure, honesty, transparency and accountability, those fundamental principles should also apply to government officials. They rarely do.

Justice Department lawyers have knowingly lied to judges in immigration cases. Hillary Clinton, Susan Rice, Ben Rhodes and other officials have been caught in multiple bald-faced lies. The IRS deliberately targeted conservatives, and then destroyed records and lied about its actions. EPA bungled a mine cleanup, polluted waterways in four states and lied about the impacts. NOAA and EPA have engaged in systematic misrepresentations and data manipulation on climate change. No one has been punished.

The impacts on company profits, investors, employees, families and communities have been extensive. Government agencies want more and more power and control over our lives – but refuse to accept any accountability for incompetence, malfeasance, deliberate lies or the serious harm they cause.

This is why Americans are fed up. Perhaps the 2016 elections will finally bring long overdue change.

Categories: On the Blog

Google’s Growing US Search/Android Share Complicates FCC’s AllVid Proposal

Somewhat Reasonable - May 29, 2016, 10:47 AM

[Note: this blog was submitted to the FCC as a reply comment in the AllVid Set Top Box NPRM.]

As more evidence comes to light exposing Google’s much increased search and Android dominance in the U.S. since the FTC closed its search and Android antitrust probes in January 2013, it only becomes clearer that the FCC’s AllVid proposed rulemaking to “Unlock the [set-top] Box” is obviously anticompetitive overall, not pro-competitive as the FCC naively claims.

(A brief context refresh is needed here. In a nutshell, Google is the primary impetus behind the FCC’s controversial AllVid set top box proposal that would force U.S. pay-TV providers to effectively open-source  cable set-top boxes and the $200b worth of proprietary video programming/information that flows through them, so that Google and other edge platforms could monetize that proprietary video programming without a license — for free.

If passed this summer, Google will be the lion’s share commercial beneficiary of this FCC rulemaking, because Google commands the Internet’s dominant “navigation device,”  its dominant search engine, and it commands the world’s and America’s dominant licensable mobile operating system, Android, the “gateway software” for the mobile Internet.)

The core problem here is the FCC’s misrepresentation that when one “unlocks” something of great value, it presents no risk to the great value previously protected by the lock.

In other words, the FCC is cherry-picking and selectively framing the question to be about the $20b in annual set-top-box revenue, when it is really about the business viability and sustainability of America’s entire $200b a year, pay-TV ecosystem, in which set top boxes currently serve as the linchpin security component.

Consider the evidence that Google has become an even more dominant Internet gatekeeper since the FCC announced its AllVid rulemaking.

Search

This May, the Sunday Telegraph reported that the EU plans to fine Google an EU record ~€3b for “web search monopoly abuse” and that “Google will be banned from continuing to manipulate search results to favour itself and harm rivals.” The EU’s 2015 Statement of Objections put Google’s search share at >90% in the EU.

Earlier in May, Politico reported that the U.S. Federal Trade Commission was reopening its Google Search antitrust investigation.

Thus the FTC and the media need to update their thinking from 2012 when the FTC shut down their Google search bias and Android investigations without any action on those particular complaints.

When they do, they will find a very different factual story in 2016 — to the extent they investigate beyond  Google’s U.S. desktop search market share of 64% per comScore, and investigate Google’s mobile and mobile + desktop market shares.  

Mobile search matters much more now, because Google announced a year ago that over half of all Google searches in the U.S. are mobile searches; and because mobile’s rate of growth far exceeds desktop’s rate of growth.

Google’s U.S. mobile search market share is now ~90%, given StatCounter’s current estimate of ~91% U.S. mobile search market share; and Netmarketshare’s implicit estimate of ~90% share given: Android and iOS comprise ~90% of U.S. OS mobile share and Apple iOS uses Google search by default; and given Google’s global mobile share is currently ~95%.

In addition to mobile searches growing faster than desktop searches, Google’s only significant U.S. search competitor, the combined Microsoft-Bing-Yahoo search platform, is losing share steadily because Microsoft effectively has conceded the mobile search and search advertising markets by writing off Nokia, and in selling off display ad assets to Verizon and map assets to Uber. And its former happy search partner, Yahoo, is now unhappy with Bing and petitioning the DOJ for permission to use Google’s platform for up to half of its search inventory.

Simply, the two estimates above indicate Google’s 2016 search share is 33% higher than it was in 2012 (from 64% for desktop in 2012 to 85% for desktop-mobile combined in 2016); and 41% higher than 2012,if the baseline is 64% desktop share to ~90% mobile share.

That is a huge change in the underlying fact predicate at the FTC in just a little over three years. This is damning evidence that Google’s monopoly network effects are exceptionally powerful.

Operating System

In addition to search shares being very different today from 2016, the search and Android investigations that the FTC decided to drop in late 2012, are completely different than the search-driven Android case that the EU charged Google with last month, in its April 2016 Android Statement of Objections.

Simply, the EU charged competitive foreclosure behavior: “Google has implemented a strategy on mobile devices to preserve and strengthen its dominance in general internet search. First, the practices mean that Google Search is pre-installed and set as the default, or exclusive, search service on most Android devices sold in Europe. Second, the practices appear to close off ways for rival search engines to access the market, via competing mobile browsers and operating systems.”

Importantly, the FTC’s 2012 staff report on the Google antitrust investigation concluded that “Google has strengthened its monopolies over search and search advertising through anticompetitive means, and has forestalled competitors and would be competitors’ ability to challenge those monopolies, and this will have lasting negative effects on consumer welfare.” (p. 116)

The point here is that, if a majority of FTC commissioners were willing to investigate and prosecute Google for straightforward antitrust violations, there is ample evidence to do so, given this particular case and the EU’s evidentiary findings.

There is also additional powerful evidence today that Android is a U.S. licensable mobile operating system monopoly because, the only company still trying to develop a competing operating system to Android and iOS, Acadine Technologies effectively gave-up this week because it could not attract the necessary capital to try get fully started. This comes on the heels of Mozilla giving up a few months ago on its attempt to create a Firefox mobile OS to compete with Android.

What this means is that for everybody else than Apple (which has its own iOS), most every maker of a FCC mandated set top box would have to use Android as its operating system.

Conclusion

What does this all mean for the FCC and its AllVid set top box proposal?

First it means that what the FCC is proposing to do — open sourcing the most valuable corpus of premium video programming in the world for the primary commercial benefit of Google’s search, search advertising, and licensable mobile OS monopolies — is profoundly anti-competitive.

Second it’s also the functional equivalent of an improper, FCC no-bid, sole source government contract to supply an operating system to millions of navigation devices that would not exist, but for the FCC especially creating them particularly for Google’s commercial benefit.

The FCC should start over from scratch.

[Originally published at the Precursor Blog]

Scott Cleland served as Deputy U.S. Coordinator for International Communications & Information Policy in the George H. W. Bush Administration. He is President of Precursor LLC, an emergent enterprise risk consultancy for Fortune 500 companies, some of which are Google competitors, and Chairman of NetCompetition, a pro-competition e-forum supported by broadband interests. He is also author of “Search & Destroy: Why You Can’t Trust Google Inc.” Cleland has testified before both the Senate and House antitrust subcommittees on Google and also before the relevant House oversight subcommittee on Google’s privacy problems.

Categories: On the Blog

Donald Trump, China, Trade – and Intellectual Property Theft

Somewhat Reasonable - May 28, 2016, 10:40 AM

We are in the midst of a presidential race that is fundamentally changing how many view – and thought they knew – politics. Donald Trump especially is radically altering that map. What many thought were permanent lines – turned out to be drawn on an Etch-a-Sketch. That the presumptive Republican nominee has spent the last year shaking into oblivion.

Much of what Trump has altered – desperately needed to be altered. Change can be a very good thing – especially when terrible ideas and actions have been ensconced and accepted as “the norm” and “that’s how it’s always been done.

That’s certainly the case in many instances with intellectual property (IP). Intellectual property has come to be seen as somehow less than physical property – and thus less worthy of protection from theft. In an ever increasingly digital economy – that’s even less good.

One of the first major purveyors of IP theft was Napster. Launched on June 1, 1999, Napster was a website designed to allow its users to steal digital copies of music. Millions of people downloaded songs – for which they did not pay. These same people – who would never have walked into a brick-and-mortar Tower Records store and stolen the same music on CDs – had no compunction doing the exact same thing digitally. In this way did Napster help begin to artificially, dangerously lessen the perceived value of IP.

But just because you aren’t stealing anything tangible – doesn’t mean you aren’t stealing. By illegally replicating a song (or movie, or book, or….) – you are lessening the value of the legal copies thereof. It is the exact same reason you aren’t allowed to print fake money – because it devalues real money. (Someone please tell the United States Treasury.)

Flash forward nearly two decades – and we have China. Which is Napster on uber-steroids – ensconced as government policy. On May 15 on Fox News Sunday, in defense of Trump’s call for a reanalysis of how we cut trade deals, Republican former Speaker of the House Newt Gingrich said “When you hear, for example, that the Chinese last year probably stole $360 billion in intellectual property from the United States, I think being tough about that’s a good thing. I think conservatives can be for very tough-minded trade.”

$360 billion is a LOT of heisted coin. Is that a correct count? Uber-Left PolitiFact actually said “It could actually be higher.” Equally uber-Left PundiFact said “The first thing we should note, however, is that the $360 billion figure is only for losses from cyber-hacking — a limitation that Gingrich didn’t specify. Of course, adding in non-cyber losses would only increase that figure beyond $360 billion.”

So Gingrich’s $360 billion of Chinese per annum intellectual property theft is a…conservative estimate. It’s likely much worse. And guess who picks up that massive tab? You do – in the form of higher prices for the music, movies and other things they’re stealing.

Keep that in mind when next you hear how much a “trade war” will cost you. If the “war” is negotiating anti-theft mandates – the benefits will far outweigh the costs. And will restore some sanity to intellectual property perception.

All of this raises another question. Why would our Congress work to undermine any aspect of intellectual property protection? Why would they make it harder for our creators to protect their creations? And thereby easier for the likes of China to continue – and even increase – their thievery?

Sadly, that’s what Republicans are leading the charge to do to patents. Behold the woefully misnamed “Innovation Act”:

‘Innovation Act’ Will Stifle Innovation: “For investors in technology start-ups, things are about to get much more complex and dangerous….(T)his bill actually will kill investment and innovation … The American patent, so indispensable to technology start-ups, is about to be rendered useless when faced with an infringer of disproportionate size … “

The Innovation Act Would Hurt Inventors Like Me, And Thousands Of Others: “(T)he Innovation Act threatens American inventors, particularly individual inventors and those working at small businesses and startups …”

Meanwhile, China and its ilk are licking their chops – hoping this terrible legislation becomes law.

We have decades of bad intellectual property precedent to undo. The Innovation Act isn’t helping.

[Originally published at Red State]

Categories: On the Blog

Get-Well Wishes for Elizabeth Clarke

Somewhat Reasonable - May 28, 2016, 5:33 AM

The nearly-centenarian Elizabeth Clarke is extremely ill after a serious fall and is convalescing at home in Lake Forest, Illinois.

Mrs. Clarke is a doyenne of the conservative movement in the Chicago area, a leader of Eagle Forum and the National Federation of Independent Business, and a staunch supporter of the Lincoln Legal Foundation, the Heartland Institute, the Illinois Policy Institute, the Heritage Foundation, the United Republican Fund of Illinois, the Chicago Conservative Conference, and countless other pro-freedom, pro-market, pro-family, and pro-life causes and groups in Illinois and across America.

Mrs. Clarke and her late husband, Edwin, were fixtures at nearly every conservative, libertarian, and allied meeting, conference, symposium, rally, and celebration held in the Chicago area over the last many decades. As long as health permitted they regularly attended the monthly center-right coalition meeting of the Fort Dearborn Group.

Just before the Fourth of July two years ago, in 2014, when Mrs. Clarke was 96, I had the privilege of interviewing her for an oral history project of the Heartland Institute about her remarkable life and about the changes that she had seen in the world since her birth near the end of World War I. 

Elizabeth Clark, age 96, discusses the incredible changes the world has experienced over the past 90 years with Heartland friend Joe Morris. In part two of this two-part series, Clark discusses how education has changed over the years.

Heartland has posted the interviews with Mrs. Clarke in the podcast archive of its website at www.Heartland.org.

Part 1 can be heard here:  https://www.heartland.org/podcasts/2014/07/02/elizabeth-clark-96-years-young

Part 2 can be heard here:  https://www.heartland.org/podcasts/2014/07/03/elizabeth-clark-age-96-discusses-incredible-changes-world-has-experienced-over-p

I am sure that Mrs. Clarke would welcome cards, letters, and other messages of cheer as she struggles with illness.  She is still quite mentally active and alert, and enjoys having messages read to her by her family, friends, and caregivers.

Categories: On the Blog

In The Tank Podcast (ep40): Fixing Income Inequality, CON Laws, Telemedicine, and Nutritional Labeling

Somewhat Reasonable - May 27, 2016, 3:27 PM

John and Donny continue their exploration of think tanks in #40 of the In The Tank Podcast. This weekly podcast features (as always) interviews, debates, and roundtable discussions that explore the work of think tanks across the country. The show is available for download as part of the Heartland Daily Podcast every Friday. Today’s podcast features work from the Competitive Enterprise Institute, the John Locke Foundation, the Palmetto Promise Institute, and the Mercatus Center.

Featured Work of the Week

This week’s featured work of the week is from the Competitive Enterprise Institute. John and Donny discuss a two reports recently released titled “People, Not Ratios: Why the Debate over Income Inequality Asks the Wrong Questions,” and “The Rising Tide: Answering the Right Questions in the Inequality Debate.” These two reports seek to explain why focusing on income inequality is a distraction and why we need to focus on how to increase the well-being of those in poverty by reducing barriers to entry and encouraging real free-market reforms.

In the World of Think Tankery

Today Donny and John talk about an article from the John Locke Foundation titled “Economics and Environment: NC CON law is central planning beyond Bernie’s wildest dreams.” This article explains the absurdity of Certificate of Need Laws by comparing the industry to the production of computers. The author shows that if the computer industry was as centrally planned as health care facilities, no one would stand for it. Donny compares these CON laws to the draconian “Directive 10-289” rules from Atlas Shrugged.

In the next segment, Donny and John discuss an update from the Palmetto Promise Institute about how “New Technology could Change Lives in South Carolina.” An innovative new online startup, Opternative, is attempting to change the way people go about getting an eye examine. With a new app, people can check their eyesight and obtain a prescription without having to go to the eye doctor. This innovation is now meeting resistance in a number of states. A recently passed bill banning this new technology was vetoed by South Carolina’s Governor Nikki Haley.

The last item discussed by Donny and John is an article authored by Richard Williams, Vice President for Policy Research at the Mercatus Center, titled “Why the New Nutrition Labels Won’t Work.”

Events 

I hope you’ll listen in, subscribe, and leave a review for our podcast on iTunes. We welcome your feedback in our new show’s inbox at InTheTankPodcast@gmail.com or follow us on twitter @InTheTankPod.

[Please subscribe to the Heartland Daily Podcast for free at this link.]

Categories: On the Blog

In Venezuela, Net Neutrality Does In Fact Mean Internet Censorship

Somewhat Reasonable - May 27, 2016, 11:12 AM

Venezuela is an official Socialist Utopia disaster area. (It would be nice if Team Bernie Sanders and his Democrat cohorts were paying attention – but who are we kidding.)

The United States State Department issued a travel warning back on September 18 (which still appears to be in place). The news, meanwhile, is chock full of horror stories for the people of Venezuela – the victims of full government’s inexorable conclusion.

Venezuela: How the Socialist Paradise Turned into Debt and Hyperinflation Hell

Venezuelan Economy Collapsing as Debt, Hyperinflation Take Their Toll

Imagine No Possessions, Imagine Venezuela

‘We Are Like a Bomb’: Food Riots Show Venezuela Crisis Has Gone Beyond Politics

What Venezuela’s Food Rationing Tells Us: The Price Of Something Is The Price Of Something

Venezuela, Where a Hamburger is Officially $170

With Socialism, you end up with just about nothing of everything – except government. There’s always plenty of that.

If you think $170 hamburgers are expensive in Government Xanadu – imagine how expensive “free speech” is. A government run amok – that has ruined its nation – can not allow its people to discuss said damage. So you get:

Venezuela: Research Confirms Censorship of News Platforms, Currency Websites: “A recent study conducted by the Institute for Press and Society (IPYS) in Venezuela has confirmed that at least 43 different websites are being blocked in the country, shedding new light on the filtering practices of the Venezuelan government. The research focused on documenting incidents surrounding web access and net neutrality, zeroing in on the treatment of national networks during the 2015 elections.”

Wait – what? There’s that U.S. buzz phrase – Net Neutrality. We here have been incessantly told that Net Neutrality has nothing to do with content control and government censorship. Venezuela’s government would seem to disagree:

“In 90% of cases, the websites in the study were being blocked consistently across all five of Venezuela’s largest ISPs. All appeared to constitute some violation of the notoriously broad Law on Social Responsibility on Radio, Television and Electronic Media, suggesting that the websites were blocked in compliance with an administrative measureunder the aforementioned law. More specifically, the Institute inferred that the websites are considered to promote disobedience of the law, disavow authorities, or ‘foster unrest’ within society.

Sounds pretty Tea Party-Conservative to me. Here, Net Neutrality will end up being the Internal Revenue Service (IRS) – for the Internet.

But we knew all of this before the Barack Obama Administration power grabbed the Web – because one of Net Neutrality’s biggest proponents said so. Behold college professor and avowed Marxist (please pardon the redundancy) Robert McChesney:

“Any serious effort to reform the media system would have to necessarily be part of a revolutionary program to overthrow the capitalist system itself.”

“There is no real answer (to the U.S. economic crisis) but to remove brick by brick the capitalist system itself, rebuilding the entire society on socialist principles.”

“At the moment, the battle over network neutrality is not to completely eliminate the telephone and cable companies. We are not at that point yet. But the ultimate goal is to get rid of the media capitalists in the phone and cable companies and to divest them from control.”

How very Hugo Chavez of him. Speaking of, Professor McChesney was a big fan of what Chavez was doing – and Venezuela continues to do.

“Venezuela is a constitutional republic. Chavez has won landslide victories that would be the envy of almost any elected leader in the world, in internationally monitored elections.”

“Aggressive unqualified political dissent is alive and well in the Venezuelan mainstream media, in a manner few other democratic nations have ever known, including our own.”

Ummm…not so much. In fact, Professor McChesney loved Venezuela’s first forays intoshutting down dissenting media:

“If (critical of Hugo Chavez Venezuelan station) RCTV were broadcasting in the United States, its license would have been revoked years ago. In fact its owners would likely have been tried for criminal offenses, including treason.”

Not yet here, Professor McChesney. But our Net Neutrality is new – give it time.

Venezuela’s head start is not one to emulate. But that’s exactly what we’re doing.

[Originally published at Red State]

Categories: On the Blog

The EPA’s Taking on Strippers

Somewhat Reasonable - May 27, 2016, 10:56 AM

The U.S. Environmental Protection Agency (EPA) issued its final methane rule on May 12. The 600-page rule is agenda-driven and backed by pseudoscience, emotions, and unicorn dust, and it’s important to note one specific change in the final rule amounts to a regulatory taking. The final rule imposes costly regulations on wells producing fewer than 15 barrels per day, effectively shutting down those businesses.

In North Dakota, there are over 3,000 low-volume wells, often referred to as “stripper wells.” Stripper wells are defined as those wells that produce fewer than 40 barrels of oil per day; the majority produce 15 barrels or less. The drop in oil prices is already impacting the viability of stripper wells, and the state’s oil regulators have recently loosened rules to allow these wells to be idle for up to two years as the operators wait for higher oil prices.

Stripper wells ensure every last drop of oil can be produced in a region, but the low volume means the owners of these wells are very vulnerable to changes in costs related to maintaining and operating each well. When EPA expanded its methane rule to include these low-volume wells, it effectively added significant costs to each well — a decision that will likely lead operators to abandon their projects.

A press release issued by the National Stripper Well Association (NSWA) puts it bluntly. “These new rules will cripple stripper and marginal well owners and operators, and on top of historically low oil prices, we are looking at total disaster,” said NSWA Chairwoman Darlene Wallace. “By requiring the addition of new costly equipment requirements and expensive leak detection the economics within the oil and gas industry as a whole will be fundamentally changed, severely and forever.”

Forcing owners of these low-volume wells to shut them down amounts to a regulatory taking. Under the Fifth Amendment to the U.S. Constitution, private property cannot be taken for public use without just compensation. Courts have ruled this right, commonly referred to as the Takings Clause, applies to the loss of many kinds of property taken as a result of government regulation.

According to previous court decisions, a regulatory taking must meet the “substantially advances” test, which means the regulation must substantially advance a legitimate government purpose in order to be valid. EPA has attempted to identify the legitimate government purpose behind the new methane rule, but the agency’s estimated benefits, which focus heavily on stopping climate change, are certainly up for debate. But even if it can be proven the broad goals behind the policy are valid, it will be exceptionally difficult for EPA to prove its regulations targeting the very small stripper wells “substantially” accomplish those goals.

In the final rule, EPA discusses the removal of the low-volume exemption, saying, “We were concerned about the burden on small business, in particular, where there may be little emission reduction to be achieved.” This doesn’t sound as though EPA is convinced its rule will have a substantial impact, and in other sections of the rule, EPA offers wildly conflicting views. For instance, the rule in one section says comments in favor of the exemption “did not provide any data,” but in the next paragraph, EPA favorably cites a comment against an exemption for stripper wells: “One commenter indicated that low production well sites have the potential to emit high fugitive emissions.”

Apparently, the lack of data in this instance was not fatal — probably because the term “high fugitive emissions” is so ominous that it simply must be bad.

The bottom line is the application of EPA’s methane rule to stripper wells amounts to a regulatory taking. By forcing the abandonment of private property for the owners of low-volume wells, the government will need to compensate each owner for the loss of real property — unless the regulation aimed at each low-volume well substantially advances the stated legitimate purpose, a hard assertion to prove, to say the least.

It has to be noted neither President Barack Obama’s Climate Action Plan nor his commitment to the Paris agreement were founded on a legitimate government purpose, but even if EPA can conjure a supposedly legitimate purpose for its new methane rule, forcing the abandonment of stripper wells in North Dakota and elsewhere will not substantially advance that purpose.

[Originally published at the American Spectator]

Categories: On the Blog

Heartland Daily Podcast – Arthur Viterito: Other Factors that Impact Global Temperatures

Somewhat Reasonable - May 26, 2016, 3:58 PM

In today’s edition of The Heartland Daily Podcast, Arthur Viterito, a professor of Geography of the College of Southern Maryland, joins managing editor for Environment & Climate News H. Sterling Burnett to talk about his recent research exploring other factors that affect global temperatures.

Viterito’s recent research shows geothermal venting, particularly in the Oceans affecting the transportation of heat, has a significant impact on recent warming. Critically, seismic activity correlates with temperature changes better than carbon dioxide, yet is not accounted for in climate models.

[Please subscribe to the Heartland Daily Podcast for free at this link.]

Categories: On the Blog

Heartland Daily Podcast – Peter Ferrara: Examining Obamacare Repeal & Replace Options

Somewhat Reasonable - May 25, 2016, 12:10 PM

In today’s edition of The Heartland Daily Podcast, Peter Ferrara, Heartland Senior Fellow and author of the Power to the People, joins host Michael Hamilton to discuss the different proposed plans to replace the Affordable Care Act, also known as Obamacare.

Ferrara talks through the most essential features of GOP repeal and replace plans, including a universal health insurance tax credit (UHITC) promoted by John C. Goodman – Senior Fellow at the Independent Institute and president of the Goodman Institute for Public Policy Research. Ferrara also drills down into the benefits of block-granting Medicaid to the states.

[Please subscribe to the Heartland Daily Podcast for free at this link.]

[Please subscribe to the Health Care News Podcast for free at this link.]

Categories: On the Blog

LA Times Gets Story About Portland Banning Climate Doubt Almost Right

Somewhat Reasonable - May 25, 2016, 9:03 AM

Los Angeles Times reporter Joy Resmovits reached out to me yesterday for comment about the controversy over the Portland Public Schools board voting unanimously last week to institute a ban on any materials or discussion that express doubts human activity is causing a catastrophic climate crisis. Because Ms. Resmovits is an education reporter, and not an environment reporter, there was some semblance of balance.

The angle of the story, naturally, was sympathetic to the members of the school board, who were now experience a “backlash” from folks who saw the resolution as nutty at best and harmful at worst. Heck, consindering the LA Times has banned any “skeptic” commentary on its pages, I was just happy they gave us a call.

The Heartland Institute, a conservative group, posted on its blog that the school district was “demanding that their unshakable faith in catastrophic anthropogenic global warming be the only thing taught in school.” In an email, Heartland’s director of communications, Jim Lakely, said the resolution was harmful because “it teaches kids in Portland public schools the falsehood that the science is settled.” He said he’s concerned that kids will be “indoctrinated instead of taught how the scientific method works.”

I can only imagine the reaction of some readers and editors. I’m guessing they won’t make the mistake of calling me again and exposing their readers to the truth.

One quibble — aside from the angle that underplayed the radicalism of the school board — is the way Resmovitz played hide the pea with the proof that the district did ban the words “may,” “might,” and “could” from any future materials that mention climate change.

At the school board meeting, [environmental activist Bill Bigelow] pointed to two textbooks — a modern history book and a science book — that he said don’t adequately characterize climate change. “The text is thick with the skeptical language of ‘might’ and ‘could’ and ‘may,’” he said at the time.

That could explain why the story took on a life of its own, Rosenau said. And, in fact, Lakely, the Heartland Institute spokesman, said his organization opposed what he characterized as a ban on textbooks that use the words “might,” “may” and “could” about climate science. The resolution, however, doesn’t actually use those terms.

Yes, it’s technically correct that the board’s resolution on climate change curriculum does use those words. But the man who proposed the resolution said those words in his testimony, and the resolution states that the district “will abandon the use of any adopted text material that is found to express doubt about the severity of the climate crisis or its root in human activities.” That is the same thing.

I pointed that out to Resmovitz, and she did quote that passage from the resolution in her second paragraph. But readers need to see that passage in the context of my quote — and that means near my quote. Doing so, however, would get in the way of the narrative that right-wing “skeptics” are making a big deal over nothing — and that I’m mischaracterizing the controversy.

I’d be mad, but I was in the mainstream media for 16 years, and I know how this goes. At least this was almost right, which makes it better than most MSM fare.

Categories: On the Blog

Citizens’ Revolutionary Week: Day Two

Somewhat Reasonable - May 25, 2016, 8:00 AM

Yesterday, I visited day two of the Citizens’ Revolutionary Week, an annual liberal activist conference held in Washington, D.C. hosted by far-left activist Ralph Nader.

Day two’s theme was “Breaking Through Media,” a celebration of liberal policy wins such as the Federal Communications Commission’s February 2015 net neutrality regulation. The day was all about figuring out how to build on those wins to use the government’s power over media to freeze out conservative ideas and promote liberal ideas with the power of net neutrality.

Speakers such as liberal activist Kevin Zeese and University of Iowa College of Law professor Nicholas Johnson suggested re-regulating speech in the U.S., by bringing back the “fairness doctrine,” an FCC policy requiring television stations and other broadcasters to distribute government-approved doses of government-approved points of view.

Keep on checking out Somewhat Reasonable all this week as I report from the Citizens’ Revolutionary Week!

 

 

Categories: On the Blog

Heartland Daily Podcast – Michael Coons: In Pursuit of a Countermand Amendment

Somewhat Reasonable - May 24, 2016, 4:19 PM

In today’s edition of The Heartland Daily Podcast, Michael Coons, National Legislative Director of Citizen Initiatives, joins hosts Donald Kendal and Kyle Maichle to talk about the Article V movement to create a Countermand Amendment to the Constitution of the United States.

The Countermand Amendment would give state legislatures the power of rescission. States would be able to fight back against executive orders. Coons explains how this amendment can fundamentally change how the states interact with the federal government. So far the proposed amendment has only been passed by the state of Alaska. Coons outlines the plan going forward and addresses multiple concerns a criticisms frequently brought up when discussing the Article V process.

[Please subscribe to the Heartland Daily Podcast for free at this link.]

Categories: On the Blog

Texas Republicans Overwhelmingly Approve Article V into State’s Party Platform

Somewhat Reasonable - May 24, 2016, 2:39 PM

On May 13, delegates to the state convention for the Republican Party of Texas approved a plank in the party’s platform that supports an Article V convention.

The plank received the backing of more than 80 percent of the 8,000 delegates present during the convention, which was held from May 12 to May 14 in Dallas, Texas. The topic of an Article V convention was a pretty contentious topic during hearings held by the permanent platform committee of the Texas Republican Party in the days leading up to the plank’s approval. Passionate testimony, both for and against Article V, occurred during the hearing.

A former member of the platform committee wrote a blog post imploring committee members to reject the proposed Article V plank, but the vocal opposition did not sway enough members’ opinions, as the plank was cleared out of committee and eventually approved on the convention floor.

“We support the Bill of Rights as written by our Founding Fathers and assert the authority of the 10th amendment. We urge our Texas State Legislators to call for a limited Article V Convention of States for the specific purpose of reducing the power of the federal government, including implementation of term limits. Any proposed amendments must be ratified by 3/4 of the states,” reads the Texas GOP plank.

The party’s plank on Article V is different from a separate plank in the platform opposing a constitutional convention and calling on the legislature to rescind a 1977 application. The plank does not affect the state’s 1979 application for a convention calling for a balanced budget amendment.

Gov. Greg Abbott (R) announced his support for the Convention of States project in January during an event sponsored by the Texas Public Policy Foundation (TPPF). Convention of States is a multiple amendment application for an Article V convention calling for a balanced budget requirement, term limits on members of Congress, and reductions in federal regulations. At the same event, Abbott called for nine new amendments to the Constitution of the United States, including giving states the authority to override unconstitutional laws from the national government.

Texas has become a prime target for organizations pursuing their own efforts for an Article V convention since Abbott’s announcement in January. The overwhelming approval of Texas Republicans for an Article V convention signals that momentum has shifted in favor of the movement to add additional Article V applications, which could be approved during the 2017 legislative session.

 

 

Categories: On the Blog

Attorney General Delegated His State Powers to Predatory Lawyer in Suit Against ExxonMobil

Somewhat Reasonable - May 24, 2016, 12:59 PM

Al Gore (left) and Claude Walker (right).

At a press conference held on March 29, 2016, a coalition of 19 Democratic state attorneys general and one Independent – with former Vice President Al Gore as the speaker that they privately tagged as their headline-grabbing “star power” – announced their collective efforts to deal with the problem of climate change. The attorneys general, calling themselves “AGs United for Clean Power,” declared that they planned to “creatively and aggressively” use their powers to force ExxonMobil, think tanks and individuals to comply with their preferred policy on climate change, urged on by activists intolerant of contrary views.

The press that attended had mixed reactions to the show, some overjoyed, some skeptical. Shawn McCoy, publisher of Inside Sources, questioned the AGs, saying: “A Bloomberg Review editorial noted that the Exxon investigation is preposterous and a dangerous affirmation of power. The New York Times has pointed out that Exxon has published research that lines up with mainstream climatology and therefore there’s not a comparison to Big Tobacco. So is this a publicity stunt? Is the investigation a publicity stunt?”

The AGs denied it with vigor, particularly the Independent, Claude Earl Walker, Attorney General of the Virgin Islands of the United States – an unincorporated U.S. Territory in the Caribbean Leeward Islands of the Lesser Antilles.*

Walker took the microphone and called Al Gore “my hero,” then gave an impassioned speech pledging to do something “transformational” to end reliance on fossil fuel, beginning with an investigation into ExxonMobil, which manufactures a product he believes is “destroying this earth.”

After his performance, Walker “destroyed this earth” a bit by benefitting from the expenditure of a considerable amount of Jet A fuel (most likely made by ExxonMobil Aviation) while flying the 1,628 air miles from JFK back to Cyril King Airport near his office in the capital city of the U.S. Virgin Islands, Charlotte Amalie on St. Thomas, also known as a popular cruise ship port.

Evidence shows that Walker’s March 29 press conference performance was merely for show. In reality, he had been colluding with New York State Attorney General Eric Schneiderman, his colleagues and environmental group leaders for more than a month. Walker sent his 19-page subpoena alleging “conspiracy to obtain money by false pretenses” to ExxonMobil headquarters in Dallas, Texas on March 15 – exactly two weeks before taking the stage in New York City, a fact he did not mention. He had something to hide and he hid it.

When ExxonMobil received the subpoena filed by Walker, the return address was the Washington, D.C. office of Linda Singer. Walker had delegated his territorial powers to her as his “national counsel” who would manage the investigation because his U.S. Virgin Islands Department of Justice was in disorder, according to Gov. Kenneth Mapp. Walker had been nominated for the office by the governor only last August and became “the fourth person in eight months to lead the beleaguered department – one the governor acknowledged remains in a “mess,” according to the Virgin Islands Consortium.

Singer was the perfect lawyer to perform a predatory investigation under the Virgin Islands’ Criminal Influenced and Corrupt Organization law (CICO), a stand-in for the mainland’s federal Mafia-busting Racketeering Influenced and Corrupt Organizations law (RICO).

Singer is a partner in Cohen Milstein Sellers and Toll PLLC, which touts itself as “the most effective law firm in the United States for lawsuits with a strong social and political component.” Singer is so qualified because she is a former attorney general turned plaintiffs’ lawyer with deep experience using questionable tactics to win lucrative cases. She was featured in a 2014 New York Times investigative report, “Lawyers Create Big Paydays by Coaxing Attorneys General to Sue.”

Singer was selected as the Times’ opener for their report, describing how she approached Attorney General Gary King of New Mexico with an “unusual proposition.” She wanted him “to sue the owner of a nursing home in rural New Mexico that Mr. King had never heard of and Ms. Singer had never set foot in.” Her proposed lawsuit did not cite any specific complaints about care, only numbers on staffing levels suggesting that residents were being mistreated. AG King wanted details, and Singer shortly emailed him that, “I finally got the numbers on the nursing home case and would love to discuss it with you briefly.”

The New York Times wryly highlighted “the enormous potential payoff for Ms. Singer’s firm if she could persuade Mr. King to hire her and use his state powers to investigate and sue, which he did.” This legal racket is a thriving industry, the Times continued: “Plaintiffs’ lawyers working on a contingency-fee basis have teamed up mostly with Democratic state attorneys general to file hundreds of lawsuits against businesses that make anything from pharmaceuticals to snack foods.” Not surprisingly, law firm members in this industry give generous election campaign contributions to Democratic Attorneys General candidates and party political organizations.

The payday industry was prompted by the Big Payday of the Big Tobacco case, according to the Times. Holman W. Jenkins, Jr., editorial board member of the Wall Street Journal, characterized such sue-and-settle surrogates as “the buccaneers of the trial bar” in his opinion piece, “Exxon Is Big Tobacco? Tell Me Another.”

ExxonMobil did the reasonable thing in the face of the social and political lawsuit: It sued Attorney General Walker, Linda Singer, and Cohen Milstein for violating its “constitutionally protected rights of freedom of speech, freedom from unreasonable searches and seizures, and due process of law and constitute the common law tort of abuse of process.”

Other victims of Walker’s abuse of process have also gone on the attack with lawsuits seeking sanctions against the AG, whose office has withdrawn its subpoena of libertarian think tank, Competitive Enterprise Institute, but still threatens to re-impose it at its whim. CEI is redoubling its efforts against Walker.

The Climate Change Movement and its attorneys general are not so invulnerable as they thought.

*USVI is directly overseen by the U.S. federal government and has no sovereignty such as states possess, but is allowed to elect its own territorial governor and members of its territorial legislature. Residents are citizens of the United States, elect non-voting delegates in the U.S. House of Representatives, but cannot vote in presidential elections. The Territory has its own Department of Justice headed by a governor-nominated and legislature-confirmed attorney general.

Categories: On the Blog

Citizens’ Revolutionary Week: Day One

Somewhat Reasonable - May 24, 2016, 9:19 AM

Yesterday, I visited the Citizens’ Revolutionary Week event, a big event being held in Washington, D.C. hosted by far-left activist Ralph Nader, a former candidate for the Democratic Party presidential nomination.

Karen Friedman is the Pension Rights Center’s (PRI) executive vice president and policy director. Among the Pension Rights Institute’s efforts over the years, PRI joined with other retiree, employee, and consumer groups to launch Retirement USA, a liberal coalition dedicated to transforming the nation’s private retirement system.

Friedman explains how PRI manipulated the media and lobbied lawmakers and regulators to achieve their goals, including some unorthodox yet delicious ways of convincing lawmakers to increase entitlement spending.

Check out this video I made of some of the highlights from today’s events at yesterday’s Citizens’ Revolution Week session, and make sure to keep on checking the blog for more highlights as the week goes on!

 

 

Categories: On the Blog

Heartland Daily Podcast – Jonathan Lockwood: Colorado Supreme Court Bars Local Fracking Bans

Somewhat Reasonable - May 23, 2016, 3:09 PM

In today’s edition of The Heartland Daily Podcast, Jonathan Lockwood, executive director of Advancing Colorado, joins host H. Sterling Burnett to discuss the Colorado Supreme Court’s decision to bar localities from banning hydraulic fracturing.

In addition, Lockwood discusses Gov. Hickenlooper’s (D) decision to halt work on the state plan to implement the clean power plan.

[Please subscribe to the Heartland Daily Podcast for free at this link.]

Categories: On the Blog

Why Waste Food to Replace Something We Already Have Too Much Of?

Somewhat Reasonable - May 23, 2016, 11:36 AM

The Renewable Fuel Standard (RFS)—also known as the ethanol mandate—was passed by Congress in 2005 and expanded in 2007. Regardless of market conditions, it required ever-increasing quantities of biofuel be blended into the nation’s gasoline supply—though the Environmental Protection Agency (EPA) does have the flexibility to make some adjustments based on conditions, such as availability and infrastructure.

At the time of its passage, it was unfathomable that a decade later Americans would be consuming less gasoline, not more. Instead of requiring a set, or even growing, percentage of ethanol be used, the law called for an increasing amount of gallons—which has created unforeseen complications.

Since the law was passed, due to increased fuel efficiency and a generally sluggish economy (meaning fewer people are driving to and from work every day) we’ve been using less gasoline, not more. Requiring more and more ethanol in less and less gasoline is not what the original law intended.

It was believed that the RFS would help achieve energy independence and reduce CO2 emissions—both ideas from a different era.

The RFS was passed at the low point of a decades long decline in U.S. oil production. At the time, no one knew that the trend line would totally reverse due to American ingenuity and the innovations of horizontal drilling and hydraulic fracturing that have unleashed the new era of abundance. Additionally, it was believed that corn-based fuel (which is the primary source for ethanol in the U.S.) would reduce carbon dioxide emissions—though the results have been questionable at best.

Since the RFS became law, numerous studies have been done to determine the environmental benefit of ethanol over gasoline—many of which conclude that ethanol is actually more detrimental than gasoline. At a recent House Oversight Committee hearing, John DeCicco, a research professor at the University of Michigan’s Energy Institute, said, according to Morning Consult, “the studies assuming biofuels are carbon neutral are flawed.” Morning Consult reports: “he has found ethanol’s net emissions to be as much as 70 percent higher than traditional gasoline.”

Ethanol has an unlikely collection of opponents. Addressing ads put out by the ethanol lobby positing that only “big oil” wants to end the ethanol mandate, FactCheck.org disputes the claim: “Several environmental groups oppose it as well. So does a wide coalition that includes restaurant owners concerned about upward pressure on food prices and boat manufacturers upset at the problems that ethanol can cause in marine engines.”

Despite the controversy, the EPA claims the RFS is a “success.” Janet McCabe, acting assistant administrator for EPA’s Office of Air and Radiation, says: it “has driven biofuel production and use in the U.S. to levels higher than any other nation. This administration is committed to keeping the RFS program on track, spurring continued growth in biofuel production and use, and achieving the climate and energy independence benefits that Congress envisioned from this program.”

With this in mind, it is no surprise that the biofuel industry—which wouldn’t exist without the ethanol mandate—was unhappy when, on May 18, the EPA released its biofuel blending requirements for 2017. Using its ability to make adjustments, the EPA announcement was less than the law required, but more than the market demands. The Wall Street Journal (WSJ) states; “EPA officials said they were seeking to strike a balance between Congress’s goal of using more ethanol and the realities of the current fuel market and infrastructure.” Instead, no one was happy.

In Biomass Magazine, McCabe defends the action: “The fact that Congress chose to mandate increasing and substantial amounts of renewable fuel clearly signals that it intended the RFS program to create incentives to increase renewable fuel supplies and overcome constraints in the market. The standards we are proposing would provide those incentives.”

Chet Thompson, president of American Fuel & Petrochemical Manufacturers, which represents refineries regulated under the standard, responded: “EPA’s proposal threatens to force consumers to use more biofuel than vehicles, engines and fueling infrastructure can handle.” He says: “the proposed volumes still go beyond marketplace realities.”

In contrast, a statement from Chip Bowling, president of the National Corn Growers Association said: “In the past, the EPA has cited a lack of fuel infrastructure as one reason for failing to follow statute. Our corn farmers and the ethanol industry have responded. Over the past year, we’ve invested millions of dollars along with the U.S. Department of Agriculture’s Biofuel Infrastructure Partnership to accelerate public and private investment in new ethanol pumps and fuel infrastructure. The fact is, today’s driver has more access than ever to renewable fuel choices.”

Regarding the EPA’s May 18 decision, DeCicco told me: “The EPA is trying to pick an economic middle road between the proponents and the opponents. But, through the RFS, the environment has been run off the road. Contrary to what has been promoted by the Department of Energy and some other government agencies, biofuels make CO2 emissions worse rather than better.”

At the aforementioned House hearing, Representative Jim Jordan’s (R-OH) opening statement called the RFS “a classic example of what happens when you get a bunch of politicians together who think they’re smarter than the marketplace.”

Frank Macchiarola, downstream director at the American Petroleum Institute, is calling on Congress to “repeal or significantly reform the RFS.” He asserts: “Members on both sides of the aisle agree this program is a failure, and we are stepping up our call for Congress to act.”

Proving Macchiarola’s point, before the 2017 requirements were released, on May 10, U.S. Representatives Bill Flores (R-TX), Peter Welch (D-VT), Bob Goodlatte (R-VA), Jim Costa (D-CA), Steve Womack (R-AR), and Cedric Richmond (D-LA) introduced bipartisan RFS reform legislation. The Food and Fuel Consumer Protection Act, H.R. 5180, limits the RFS mandate to levels that our nation’s cars, trucks, boats and other small engines can safely accommodate. The bill “directs EPA to consider current market realities and cap the maximum volume of ethanol blended into the transportation fuel supply at 9.7 percent of projected gasoline demand.” Following the news, the bill’s cosponsors issued a statement calling the RFS “unsustainable.”

It is time to get back to allowing the free market—not Congress, not unelected bureaucrats, not mandates, not artificially spurred growth in a chosen industry—to determine our fuel choices. Because ethanol is an effective octane-boosting additive, it will always have market demand. Farmers who’ve invested in it will not be driven out of business. The Food and Fuel Consumer Protection Act, while not repealing the RFS outright (which would be tough to pass), offers a reasonable fix to well-intended, but flawed legislation.

The author of Energy Freedom, Marita Noon serves as the executive director for Energy Makes America Great Inc., and the companion educational organization, the Citizens’ Alliance for Responsible Energy (CARE). She hosts a weekly radio program: America’s Voice for Energy—which expands on the content of her weekly column. Follow her @EnergyRabbit.

Categories: On the Blog

Graduates Face a Big Challenge

Somewhat Reasonable - May 23, 2016, 11:05 AM

As they don caps and gowns, endure commencement speeches and take their diplomas, many high school and college graduates face bleak prospects in an economy that grew a dismal 0.5% the first quarter.

The United States added a meager 160,000 new non-farm jobs in April, a paltry 4,000 of them in manufacturing. First quarter 2016 averaged just 203,000 jobs per month. The labor force participation rate remains stuck at an abysmal 63% – meaning 93 million working age Americans are still unemployed.

Many who are working hold multiple jobs to make ends meet, while others are toiling at temporary, part-time or “gig” jobs, at lower pay, with few benefits and little job security.

They and the graduates may be hoping that Donald Trump will “Make America great again,” Hillary Clinton will “revitalize” our ailing economy, or Bernie Sanders will “invest” trillions of tax dollars to train and employ millions of young Americans in a 100% clean energy economy.

Like the candidates, they may be blaming our economic woes on China, climate change, Wall Street, the one percent, Mexico, inadequate supervision of greedy capitalist corporations, unpatriotic companies fleeing to foreign shores, or insufficient tax revenues to support essential government programs.

All are appealing excuses, but the real answer is much closer to home and involves multiple self-inflicted wounds. Most legislators and regulators are loath to admit any responsibility for our economic woes, and most graduates will find it hard to analyze the problem. However, the analytical process is essential.

The difficulty for students and graduates is that most were not taught how to think. Their teachers too often present mostly liberal-socialist ideology as unassailable fact, discourage or prohibit discussion and debate, and shelter sensitive snowflakes via speech codes, safe zones and bans on verbal microagression.

While raking in millions of taxpayer dollars for climate research, a cabal of RICO-20 university professors has gone even further. It has asked US and state attorneys general to launch racketeering prosecutions of anyone who disagrees with alarmist views on “dangerous manmade global warming.”

World-renowned physicist and Nobel Laureate Richard Feynman’s admonition has been largely discarded in the halls of academia. “I would rather have questions that can’t be answered,” he said, “than answers that can’t be questioned.” Sadly, answers that none dare question now dominate classroom life.

And so, as you and graduates in your family or circle of friends leave those institutions of rote learning, and go into the Real World, you will have to undertake your greatest challenge: learning to think.

Examining, questioning, discussing and challenging hypotheses, assertions and accepted “facts” are always absolutely essential for scientific, technological and societal progress. In this election year, it behooves us all to demand details from candidates, honestly assess whether their proposals will improve or worsen our economic situation, insist on and participate in rigorous debates, and cast informed votes.

As you try to understand why our economy has been so anemic, why so few jobs are being created, and why one in three young American voters supports socialism as better than free enterprise – here are just a few realities to ponder.

God gave Moses Ten Commandments. The federal government has given us tens of thousands of commandments, enforced by millions of nameless, unelected bureaucrats who have nearly unfettered discretion to interpret and administer their rules. Complying with them costs American families and businesses $1.9 trillion per year. That’s more than the entire Russian economy, more than the IRS collected in corporate and personal taxes in 2015, and $15,000 in hidden costs for every family.

The Obama Administration has been publishing 80,000 pages of new regulations per year – and is preparing to unleash 3,000 more rules before it leaves office. Small businesses are hurt most, as they cannot possibly read, comprehend and comply with this regulatory tsunami. They thus live in fear that any unknown or inadvertent violation will result in massive fines or even jail time. Indeed, more than 4,500 federal rules carry criminal penalties, and lack of knowledge or intent is no defense.

Coupled with the highest corporate tax rates in the developed world, new hourly wage and overtime rules, and mountains of state and local regulations, these federal edicts dramatically impair hiring and growth.

This unintended job and economic destruction has shrunk middle class family incomes by more than $1,000 per year during the Obama era, sent 3 million more families into poverty, and added over 600,000 black Americans to the overall poverty number. The intentional damage is even more insidious.

The Obama EPA’s war on fossil fuels has contributed greatly to the loss of nearly 50,000 coal industry jobs since 2008. Mrs. Clinton has made it clear that she will “put a lot of coal miners and coal companies out of business,” if she is elected. Like Senator Sanders, she also wants to eliminate most US oil and natural gas production – while ignoring the fact that fossil fuels still provide 82% of all US energy.

That would mean vastly more land-intensive, heavily subsidized wind, solar and biofuel substitutes. It would send electricity and motor fuel prices skyrocketing to levels now found in California and New York, or even in Britain and Germany: double, triple or quadruple what most Americans now pay.

For hospitals, factories, school districts and other major energy users, that would bring thousands to millions of dollars per year in higher costs – and thus countless more lost jobs and closed doors.

President Obama, Mrs. Clinton, Mr. Sanders, most Democrats and even some Republicans justify these self-inflicted wounds by saying they are necessary to prevent catastrophic global warming and climate change. But even if plant-fertilizing carbon dioxide is a primary culprit – and thousands of scientists say it is not – even shutting down all US fossil fuel use would bring no benefits, amid tremendous pain.

China alone accounts for 80% of the entire world’s increase in coal consumption so far this century. It now consumes as much coal as the rest of the world combined. The 155 new coal-fired power plants it is currently planning to build will burn twice as much coal as all of Germany’s existing plants do. Coal generates 67% of China’s electricity, oil and natural gas 23%, hydro 10%, and wind and solar combined only 2 percent. Nearly a billion Chinese still exist on less than $5 per day, and the Middle Kingdom will be burning fossil fuels for decades to improve their living standards.

India, Indonesia, the rest of Asia, all of Africa and much of Latin America are in the same situation. All are burning coal, oil and natural gas to lift billions out of abject poverty – and will continue doing so.

America’s political classes always protect themselves. It is poor, minority, middle-class and blue-collar families that will suffer – along with most of you graduates – from these all pain/no gain climate policies.

Politicians always like to show they care, by giving other people’s money to worthy causes, their favorite voting blocs and their campaign contributors. They are far less charitable with their own money. Joe and Jill Biden raked in $333,182 in 2009 – and gave just $4,820 to charity; during the previous decade, they averaged $369 annually. Between 2007 and 2014, the Clintons “earned” $139 million; they gave $14,959,450 to charity – but 98.7% of that went to the scandal-ridden Clinton Family Foundation.

Socialist and anti-energy policies boil down to strangling jobs and wealth creation … making the economic pie smaller and smaller … taking money from hard-working taxpayers and giving it to “less fortunate” people who aren’t working but will likely vote for politicians who promise them “free stuff” … and ensuring “more equitable sharing” of ever greater scarcity, poverty and misery (for non-ruling elites).

As to telling poor countries to stop using fossil fuels, it is an unconscionable crime against humanity to impose policies that pretend to protect Earth’s poor, malnourished and energy-deprived masses from hypothetical climate chaos – by perpetuating poverty, malnutrition and disease that kill millions of them every year, right now.

Think about all of this as you take your diploma, evaluate candidates, and head to the polls.

Paul Driessen is senior policy analyst for the Committee For A Constructive Tomorrow (www.CFACT.org) and author of Eco-Imperialism: Green power – Black death.

Categories: On the Blog

For Safety’s Sake, We Should Encourage Uber and Lyft

Somewhat Reasonable - May 23, 2016, 10:52 AM

Austin voters have approved a ballot referendum to regulate peer-to-peer transportation network companies such as Lyft and Uber, forcing the companies to suspend service in a city otherwise known for its forward thinking and friendliness toward innovation.

These peer-to-peer businesses directly connect drivers, who are otherwise not using their vehicles, with passengers who need transportation.

In February, Austin City Council members approved an ordinance requiring Uber and Lyft drivers to submit to criminal background checks, which are administered by law enforcement, in addition to the companies’ existing background-check procedures.

Before the new restrictions, Austin consumers were able to choose between getting a lift from one of the city’s 10,000 Uber drivers or the 750 government-approved taxicab industry workers.

Now, Austin consumers’ only option is the one that government officials have talked them into approving: taxicabs.

Considering that in 2012 city officials were working to reduce the availability of for-hire transportation — in order to artificially boost taxicab drivers’ income — it’s clear they are not working in the best interests of consumers.

Instead of protecting the public from supposedly dangerous rogue Uber drivers, restricting consumers’ transportation choices actually negatively impacts public safety.

A study published by Temple University’s Fox School of Business, written by professors Brad Greenwood and Sunil Wattal, studied how the availability of Uber has affected alcohol-related vehicular homicide rates.

Examining drunk-driving rates in six urban California counties over a five-year period during which Uber expanded significantly, Greenwood and Wattal found a “significant drop in the rate of [alcohol-related vehicular] homicides after the introduction of Uber.”

The rates dropped by 3.6 to 5.6 percent in counties Uber started serving.

When the researchers scaled up the data taken from the county level to the national level, they found allowing consumers all over the country to call for an Uber driver after a night of drinking wouldn’t just save lives, it would save billions of dollars otherwise spent on law enforcement, criminal justice and medical care.

“With more than 13,000 deaths occurring nationally each year due to alcohol-related car crashes at a cost of $37 billion, results indicate that a complete implementation of [Uber] would create a public welfare net of over $1.3 billion to American taxpayers and save roughly 500 lives annually,” Greenwood and Wattal wrote.

Evidence collected by Zachary Kalmbach, a research scholar at Texas A&M University, suggests Uber and other peer-to-peer transportation network companies have an outsized effect on drunk-driving rates in the first months after consumers gain access to ride-sharing applications.

Studying driving-under-influence rates in nine cities, including Austin, Kalmbach found a correlation between Uber expansion and safer consumer behavior on the roads.

Controlling for outside variables potentially affecting the results, such as marijuana legalization, Kalmbach estimates the “percentage impact is a reduction in DUIs of about 26 percent in the month that [Uber] is launched,” a result he found “statistically significant.”

Instead of looking to protect the health of politically powerful special-interest groups, such as well-funded taxicab companies, lawmakers should take steps that actually help people.

They should be encouraged, not squashed by regulation and taxes.

[Originally published at the Star-Telegram]
Categories: On the Blog

Puerto Rico’s Economic Crisis Rooted in History of Feds’ Anti-Trade Policies

Somewhat Reasonable - May 22, 2016, 1:10 PM

Alejandro Garcia Padilla, the governor of Puerto Rico, has skipped out on a $422 million payment owed to private-sector creditors.

The missed payment, due on May 1, was just another scene in the slow-motion train wreck that has been termed “Puerto Rico’s economic crisis,” but to call the territory’s status a “crisis” understates the severity of the problem. Over 12 percent of the workforce in Puerto Rico is unemployed, and one out of every four employed Puerto Ricans works for the government, instead of contributing to the territory’s economy.

The job-sector universe—the raw number of jobs available and filled—in the territory is contracting as well. According to the U.S. Department of Labor’s Bureau of Labor Statistics (BLS), there were 889,200 employed people working in Puerto Rico in October 2015. In March 2016, the most recent month for which BLS statistics are available, there were 893,300 people working, which means an average of 683 more people became unemployed every month for six consecutive months.

Puerto Rico’s territorial government is responsible for some of the problems its people are facing, such as its overly generous entitlement programs for workers, but Washington, DC lawmakers are ultimately responsible for the territory’s economic death spiral. As a territory, Puerto Rico exists at the pleasure of the U.S. Congress. Puerto Rico can elect its own governor, but Congress maintains most of the power.

One Washington, DC policy making things worse for Puerto Rico is called the Jones Act. The Jones Act, or the Merchant Marine Act of 1920, was passed nearly 100 years ago as part of the fit of anti-trade sentiment that led to the Great Depression. It was intended to require regions of the United States separated by the open ocean to be serviced by all-American crews and ships, built with all-American parts, thereby banning foreign vessels from transporting goods from the United States to states and territories such as Alaska, Hawaii, and Puerto Rico.

Instead of promoting economic prosperity by tilting the playing field, protectionist trade policies such as the Jones Act disadvantage consumers and benefit businesses favored by the government.

A 2012 report issued by the Federal Reserve Bank of New York (FRB-NY) studied the effect of the Jones Act on Puerto Rico and concluded increasing the cost of shipping goods to Puerto Rico from the mainland has resulted in fewer goods being shipped to Puerto Rico and less money available to Puerto Ricans.

According to the American Maritime Congress, a lobbyist organization representing the interests of the merchant marine industry, only 77 ships in the entire world comply with the requirements of the Jones Act. By artificially reducing the volume of shipping, the cost of shipping increases, making everyday goods more expensive for Puerto Ricans.

“It costs an estimated $3,063 to ship a twenty-foot container of household and commercial goods from the East Coast of the United States to Puerto Rico; the same shipment costs $1,504 to nearby Santo Domingo (Dominican Republic) and $1,687 to Kingston (Jamaica)—destinations that are not subject to Jones Act restrictions,” the Federal Reserve Bank of New York wrote.

Although other factors have contributed to Puerto Rico’s financial ship of state running aground, Washington, DC lawmakers’ refusal to face the reality of a global economy, by removing protectionist policies and allowing the free market to determine the cost of shipping goods, has played a significant role in making life on the “Island of Enchantment” less enchanting and more miserable.

Instead of considering targeted big-ticket bailouts from the mainland’s treasury to patch over their past mistakes, national lawmakers should enact free-market policies, including repealing the Jones Act, to help make prosperity more readily available to everyone, regardless of whether they live in Chicago, California, or Canóvanas.

[Originally published at Inside Sources]

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