What Does The QE Experience Say About Rates In A Shrinking Fed Balance Sheet World? -- The Federal Reserve is likely to decide next week to begin letting assets roll of its balance sheet as bonds mature, instead of reinvesting the proceeds.This means that the balance sheet will begin to shrink in size and other market participants will be forced to absorb the supply of new issuance of treasury and mortgage backed securities. Conventional analysis of supply and demand dynamics might suggest the exiting of a large marginal buyer of these securities would cause yields to rise to some higher equilibrium level, but the QE experience suggests something else entirely. When the Fed was engaged in asset purchases and the rate of change in the Fed’s balance sheet was rising (late 2010, mid 2012 through early 2013) long-term treasury yields rose on the back of juiced growth and inflation expectations produced by the stimulus. When the rate of change in the Fed’s balance sheet would flat line or fall (most of 2010, most of 2013 through 2014) treasury yields fell on the back of subdued growth and inflation expectations. Importantly, it was both real rates (TIPS) and breakeven inflation that followed this pattern, which is indicative of the level of economic stimulus produced by QE.Chart 1 below shows 10-year nominal rates (red line, right axis) overlaid on the three month difference in the Fed’s balance sheet (blue line, left axis). Chart 2 below shows 10-year real rates (red line, right axis) overlaid on the three month difference in the Fed’s balance sheet (blue line, left axis). Chart 3 below shows 10-year implied breakeven inflation expectations (red line, right axis) overlaid on the three month difference in the Fed’s balance sheet (blue line, left axis). But all that is history. The question now is what will happen to rates as the Fed begins to unwind its balance sheet. Is there a reason to believe that inflation and growth expectations will rise as the Fed tightens policy? In other words, is there reason to believe rates will act differently during the unwind than they did during the wind? We think the same economic mechanisms that were in place between 2009-2014 are still in place today and that long rates are likely to move lower as the Fed tightens policy via a smaller balance sheet.
Will the Fed’s balance sheet reduction avoid another taper tantrum? - The Fed has offered some idea of how it will start reducing the size of its balance sheet, but there’s no way to anticipate how or when it will end. What will be the impact on the real economy? If it results in more tightening of financial conditions than the Fed desires, how will it be offset? How big will the balance sheet still be when the Fed deems it fully normalised? At what balance-sheet size would the competition for reserves from financial institutions start overriding the effect of the interest paid by them? If the economy once again tips into a downturn, will the Fed consider once again growing its portfolio holdings? Although these questions don’t yet have answers, the many attendant complexities are explored in a deeply researched, comprehensive new note from Nomura’s Lew Alexander. You can read the whole thing by clicking here, but we highlight and discuss a few excerpts below.
Will the Great Taper Bring on GFC 2.0? --After many years of sizable increases in central bank balance sheets (Figure 2), major changes in central bank purchases are approaching, as i) the Fed is due to announce balance sheet reduction in September and begin implementing it in October, ii) the ECB will probably announce a reduction in its net purchase volume in October (to begin in Jan-18) and will probably end its net asset purchases in H2- 2018. In addition, the BoJ net asset purchases have fallen and we expect them to continue to fall, even though the BoJ now pursues a yield-targeting policy. Overall, advanced economy (AE) net asset purchases are likely to fall from $100bn/month currently to roughly zero by end-2018 (Figure 1) and aggregate AE central bank balance sheets are likely to peak soon (in dollar terms around end- 2018 and relative to GDP in mid-2018). This note discusses the trajectories of central bank asset purchases, their drivers, exit strategies, potential implications and risks. The change in central bank purchases is mostly due to a better economic backdrop in AEs – much lower unemployment rates and somewhat higher inflation – even though political reasons and technical factors also play a role. Central banks will tread carefully and the direct impact of global tapering on the real economy will likely be modest. But there is a material risk in our view, that major asset price corrections could be triggered by this global tapering (Figure 3). If global tapering were to puncture asset bubbles, this could magnify the effects of global tapering on the real economy, by discouraging investment, lifting corporate defaults and leading households to retrench and could therefore be associated with a significant global economic slowdown, too.
Janet Yellen Had Breakfast With Ivanka Trump On July 17, Fed Schedule Reveals -- Fed Chair Janet Yellen had a breakfast meeting with Donald Trump's daughter, Ivanka, on Monday, July 17 from 8am to 9am, at the U.S. central bank, according to Fed public schedules, posted earlier this month on the Fed website. Bloomberg first reported the encounter.Eight days after the one-hour meeting in a private dining room at the Fed, on July 25 Trump told the Wall Street Journal that Yellen was “in the running, absolutely,” for a second term as chair. “I like her; I like her demeanor. I think she’s done a good job,” he said. “I’d like to see rates stay low. She’s historically been a low-interest-rate person" the president added about the Fed chairman. The Fed chair often meets with administration officials and members of Congress. But as the LA Times notes, a sit-down with a member of the First Family is highly unusual for the chief of the nation's independent central bank.The breakfast came as Yellen's four-year term is set to expire in February. She has not said publicly if she is interested in a second term but Trump has said he is considering renominating her.Ivanka Trump is an unpaid assistant to the president and a key advisor. She has advocated for women's issues, such as paid family leave and an expanded child tax credit. On June 5, Ivanka Trump tweeted an excerpt of a speech Yellen gave a month earlier at Brown University in which she said: “Too many women struggle to combine aspirations for work and family.” Ivanka Trump’s office didn’t immediately respond to a request for comment. Ivanka Trump and Yellen had breakfast in a room in the Fed's beaux arts Marriner S. Eccles Building, where Yellen frequently dines with guests. In July, Yellen also had breakfast there twice with Treasury Secretary Steven T. Mnuchin. She also had lunch there in July with Gary Cohn, the White House's top economic advisor and a possible rival for the Fed chairmanship.
Key Measures Show Inflation mostly below 2% in August - The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.2% (3.0% annualized rate) in August. The 16% trimmed-mean Consumer Price Index also rose 0.2% (2.3% annualized rate) during the month. The median CPI and 16% trimmed-mean CPI are measures of core inflation calculated by the Federal Reserve Bank of Cleveland based on data released in the Bureau of Labor Statistics' (BLS) monthly CPI report. Earlier today, the BLS reported that the seasonally adjusted CPI for all urban consumers rose 0.4% (4.9% annualized rate) in August. The CPI less food and energy rose 0.2% (3.0% annualized rate) on a seasonally adjusted basis. Note: The Cleveland Fed released the median CPI details for August here. Motor fuel increased 107% in August, annualized.
Goldman: Hurricane and Economic Data -- A few excerpts from a research note by Goldman Sachs economist Spencer Hill: Hurricane Handbook: Natural Disasters and Economic Data
• We find that major natural disasters are associated with a temporary slowdown in most major growth indicators. ... Modeling these effects, we estimate that hurricane-related disruptions could reduce 3Q GDP growth by as much as 1 percentage point. We believe the main channels for these GDP effects are consumption, inventories, housing, and the energy sector.CR Note: We've already seen a sharp increase in unemployment claims (as expected), and a drop in auto sales. Harvey and Irma will probably negatively impact other indicators for August and September. As Hill notes, we should see a sharp rebound later this year in many indicators.
• We expect a meaningful drag on key growth indicators over the next two months, including a temporary drag on September payrolls growth of 20k—or as much as 100k if severe storm effects persist into next week (the payrolls reference period). We also expect a near-term boost to headline inflation (around 0.2pp on the yoy rate) due to higher gasoline prices ...
• Given potentially sizeable growth effects from Harvey—and with Irma risks now moving to center stage—we are lowering our Q3 GDP tracking estimate by 0.8pp to +2.0%. However, we expect this weakness to reverse over the subsequent three quarters, more than recouping the lost output.
emphasis added
Hurricanes Irma, Harvey to cast pall over U.S. economy for months and even years - Hurricanes Harvey and Irma have upended the lives of millions of Americans, but the aftereffects will also linger in much smaller way for those entrusted with keeping the U.S. economy safe and sound. The storms caused tremendous damage, forced thousands of businesses to close and compelled millions of people flee their homes. The cleanup will take years and cost untold sums of money. The silver lining is that the U.S. economy, now in the ninth year of expansion, is in the best shape in almost two decades. The federal government has more resources at hand to help and a growing economy will aid the areas devastated by the storms as they seek to recover. At the same time, though, the dislocations will make it harder over the next several months for economists, investors and senior officials at the Federal Reserve to take the temperature of the economy. Monthly reports on hiring and construction, for example, could look dramatically worse in the next month or two, reflecting almost recession-like levels. And then the inevitable snapback would make the economy look stronger than it is.“The long-run effect of these disasters, unfortunately, is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms,” New York Federal Reserve William Dudley said in an interview just before Irma struck. The rebuilding efforts are sure to pad figures for job creation, retail sales, consumer spending and manufacturing activity. More workers and materials will be needed replace the houses lost, the roads destroyed, the shorelines damaged and so forth. The first taste of the storms’ impact has already shown up. Last week, initial U.S. jobless claims soared by 62,000 to 298,000 to mark the biggest one-week increase since 2012. Virtually all of the increase came in Texas where the damage from Harvey was the most severe. More evidence of disruption could also come in this week’s report on August retail sales. Millions of Americans in the Gulf Coast may have rushed to the stores to buy supplies before Harvey made landfall late in the month, inflating sales figures.
Q3 GDP Forecasts: Moving Down - From Merrill Lynch: The data [today] sliced 0.8pp from 3Q GDP tracking, down to 1.7%. From the Altanta Fed: GDPNow: The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2017 is 2.2 percent on September 15, down from 3.0 percent on September 8. The forecasts of real consumer spending growth and real private fixed investment growth fell from 2.7 percent and 2.6 percent, respectively, to 2.0 percent and 1.4 percent, respectively, after this morning's retail sales release from the U.S. Census Bureau and this morning's report on industrial production and capacity utilization from the Federal Reserve Board of Governors. From the NY Fed Nowcasting Report The New York Fed Staff Nowcast stands at 1.3% for 2017:Q3 and 1.8% for 2017:Q4.CR Note: Looks like weak real GDP growth in Q3, some due to the impact of the hurricanes.
This Is The Dollar's Worst Year Since The Plaza Accord - Entering 2017, the USD had been up four years running on a broad trade-weighted basis with 8.6% gains in 2014, 10.7% appreciation in 2015 and a more modest 3.0% move in 2016.That last year was a less dramatic move, but from May 2nd lows to the 15+ year peak on January 7th, the buck was up almost 9.3% or 14.5% at an annual pace.Unfortunately for greenback bulls, things have gone wildly off-script since. As Bespoke Investment Group details, the dollar has reversed its entire May 2016-January 2017 rally in a move that’s frankly shocked the FX world.As shown below, for the broad trade weight dollar, this was the worst year on record through last Friday (latest data available) and the route has gotten worse this week with the Bloomberg USD Index (a decent proxy for the USD broad trade-weighted index) down a whopping 1.5% this week, its worst since the five days ending May 19th. Given that US economic data has actually held up quite well and there have been no radical policy shifts from the FOMC, that’s a pretty staggering move. On a narrow major currency basis, the USD is just as weak. As shown below, this was the worst YTD through September 1st since 1986 (the year following the Plaza Accord agreement to devalue the USD) and the second-worst ever after this week’s decline, besting the 10% devaluation of the dollar engineered in 1973.
A Few Words on the Dollar - Brad Setser - The dollar—to many people’s surprise—has depreciated this year. That depreciation comes after a rise in late 2016 following Trump’s election, and after a large appreciation in 2014.To me, the dollar’s recent fall is a good thing.Since its 2014 appreciation, the dollar has been too strong for the manufacturing side of the U.S. economy. Manufactured exports fell as a share of U.S. GDP in 2015 and 2016, and in my view were on track to continue to fall had the dollar’s late 2016 level been maintained. Even with the latest move the dollar would need to depreciate by substantially more (at least 10 percent) to get back to its early 2014 levels.It is not hard to see the slump in manufactured exports in the trade data. Look at the Brookings data visualization. Or the following chart. Since 2014, the U.S. slowly has been transforming into an exporter of commodities rather than an exporter of capital goods. Real exports (in 2009 dollars) of industrial supplies (lumber, coal, ores, petrol, chemicals and the like) and agricultural goods now exceed real exports of capital goods (aircraft, semiconductors, generators, large diesel engines, and the like).* Much of the west coast of the U.S. probably “works” as an exporter of commodities, tourism services (Hollywood, Vegas, the Grand Canyon), high-end real estate and software and electronics related intellectual property (even if a lot of that IPR is currently exported to the Caribbean and Ireland at an artificially low price for tax reasons).**But a currency union that includes the Midwest and Southeast, in my view, does not.*** Shrinking exports of high end manufactures—and a growing deficit in manufacturing trade—are a structural problem for the overall economy, and an even bigger problem for some regions (if you have a Wall Street Journal subscription, there is a great map here).Fortunately, the evidence of the past few years suggests that exports do respond, with a lag, to the dollar. Nevertheless I do worry that the fall in exports from a strong dollar is a bit stronger than the rise in exports from a weak dollar: I suspect because there is a hysteresis effect: Once a factory is shut down, it stays shut down—and if firms don’t continuously invest to stay at the cutting edge of technology, it can be hard for a high-wage advanced economy to stay globally competitive.
Trump Dumps the Do-Nothing Congress | Pat Buchanan -- Donald Trump is president today because he was seen as a doer not a talker. Among the most common compliments paid him in 2016 was, “At least he gets things done!” And it was exasperation with a dithering GOP Congress, which had failed to enact his or its own agenda, that caused Trump to pull the job of raising the debt ceiling away from Republican contractors Ryan & McConnell, and give it to Pelosi & Schumer. Hard to fault Trump. Over seven months, Congress showed itself incapable of repealing Obamacare, though the GOP promised this as its first priority in three successive elections. Returning to D.C. after five weeks vacation, with zero legislation enacted, Speaker Paul Ryan and Majority Leader Mitch McConnell were facing a deadline to raise the debt ceiling and fund the government. Failure to do so would crash the markets, imperil the U.S. bond rating, and make America look like a deadbeat republic. Families and businesses do this annually. Yet, every year, it seems, Congress goes up to the precipice of national default before authorizing the borrowing to pay the bills Congress itself has run up.
Freedom Caucus Leader: "Don't Blame Trump For Deal With 'Chuck And Nancy'" -- With much of the Washington Republican establishment still grumbling about President Donald Trump’s decision earlier this week to strike a deal with Democratic leaders Chuck Schumer and Nancy Pelosi, one prominent member of the House Freedom Caucus took to the Sunday Talk Shows to deliver what sounded like the faction’s official response to the week’s events.In an appearance on Fox News Sunday, Ohio Rep. Jim Jordan struck a delicate balance: criticizing the consequences of the president's decision without impugning the man himself.Jordan explained that while the Trump-Schumer-Pelosi deal wouldn’t be “good for the American taxpayer” the president can be excused for agreeing to it because Republicans in Congress failed to provide him with a suitable alternative. And just like that, a member of the House’s most intransigent, conservative faction – the group that almost singlehandedly crushed the Trump administration’s health-care ambitions – turning the blame for Trump’s debt-ceiling can-kicking, and the powerful leverage that Democrats gained because of it, back on the president’s favorite opponents: Congressional Republicans. Here’s Jordan: “I don’t think this was a good deal for the American taxpayer. We didn’t go anything to address the underlying $20 trillion debt but frankly what options did the president have in front of him? The first time the Republican conference talked about the debt ceiling was Sunday morning. And the Freedom Caucus had called for, nine and a half weeks ago, we said ‘don’t leave town until you have a plan on the debt ceiling’ and instead we went home for the longest August recess in a decade, longer even than in elections years.” Of course, Jordan’s criticism focuses squarely on the Congressional Republican leadership. He excuses the Freedom Caucusers from blame by effectively saying that Trump’s deal with the Democrats could’ve been avoided if Speaker Paul Ryan had listened to the group’s suggestion to delay summer recess until a debt-ceiling plan had been formulated. The most important takeaway here: After spending the first eight months of Trump's term battling with the president, House conservatives appear to be extending an olive branch to the administration while also advancing their goal of ousting the party’s Congressional leadership.
McConnell Says Democrats’ Glee on Debt Limit Deal Was Premature — Senator Mitch McConnell thinks Democrats were a tad premature in exuberantly celebrating the surprise spending deal they struck last week with President Trump. “Let’s put it this way,” Mr. McConnell, the Kentucky Republican and majority leader, said Monday in an interview for The New York Times podcast “The New Washington.” “The deal is not quite as good as my counterpart thought it was.” The reason? Mr. McConnell said that he insisted the newly passed legislation preserve Treasury’s ability to apply “extraordinary measures” and shift money within government accounts to pay off debt and extend federal borrowing power. That will delay the need for another increase in the debt limit well beyond the December deadline that Democrats have been trumpeting as their big moment of leverage. And Mr. McConnell said he did so over the objections of Senator Chuck Schumer of New York, the Democratic leader and aforementioned counterpart. In fact, Mr. McConnell said, the debt limit will not have to be increased until well into 2018, taking that volatile subject off the table for the December spending talks, and eliminating the Democrats’ most dangerous bargaining chip in the first round of negotiations. Separating the debt ceiling from the deadline to fund the government also addresses one of the main complaints of conservatives who were unhappy that last week’s legislation linked hurricane relief and the increase in the debt limit, forcing many to either cast a debt limit vote they were unhappy about or to oppose hurricane relief. “Since I was in charge of drafting the debt ceiling provision that we inserted into the flood bill we likely — almost certainly — are not going to have another debt ceiling discussion until well into 2018,” said Mr. McConnell. “One of the advantages of being the majority leader is you control the paper,” Mr. McConnell said, referring to legislation. “I wrote it in such a way that it does not prevent what is frequently done, which is the use of extraordinary measures. The minority leader and his team were trying to get us not to write it that way, but I did write it that way and that is the way it passed.” Under the scenario Mr. McConnell sketched out, the December talks will now focus on hurricane relief and other budgetary matters and the administration can tell Democrats “see you next year on the debt ceiling.”
Trump may ask Congress for more disaster funding | TheHill: The White House is prepared to ask Congress for more money to fund disaster relief efforts in response to Hurricane Irma, which has caused widespread devastation in Florida and U.S. islands. Homeland security adviser Tom Bossert told reporters Monday that President Trump might seek more funding, but added "right now, we have plenty of resources to get through this." "The president and [Budget Director Mick] Mulvaney and others have started the process of a bipartisan discussion on this point," Bossert said. "We'll ask for a third, perhaps fourth supplemental for the purpose of rebuilding. We will do it smartly."Bossert declined to say how much money the administration may ask for, saying it will depend on the eventual amount of damage. Irma has killed at least seven people in the U.S. and left almost 6 million people in Florida without power. The storm has caused floods in cities across the Sunshine State and flash flood emergencies have been issued in South Carolina. The U.S. Virgin Islands and Puerto Rico were also devastated by the storm. Irma comes on the heels of Hurricane Harvey, which caused historic floods in Houston. Trump last week signed legislation that provided $15 billion in disaster aid for Harvey. Roughly 700,000 people in Houston and south Texas have registered for federal assistance as a result of Harvey. The National Flood Insurance Program, which is run by the Federal Emergency Management Agency, has about $8.6 billion to address claims. Bossert said if claims exceed that amount, the White House will ask Congress to increase the cap.
Hurricanes Katrina, Sandy, Harvey and Irma: It’s Time for the Public to Reclaim the National Budget - Pam Martens -- After the devastation of Hurricane Katrina and Super Storm Sandy, most rational nations would have imposed restrictions on coastal building and devoted meaningful portions of the national treasury to fund scientific research to limit future loss of life and economic hardships from such monster storms. And yet, here we are in 2017 facing the current reality: vast swaths of a major economic hub, Houston, lies in ruins from the flooding unleashed by Hurricane Harvey while the entire State of Florida awoke this morning to the chaos unleashed yesterday and overnight by the bizarre 415 mile-wide Hurricane Irma, with a reported 4.5 million homes and businesses currently without power in Florida, a state where temperatures routinely reach into the 90s in September and air conditioning is a necessity, not a luxury. The leadership in Washington has not reflected that of a rational nation for many years now and, tragically, U.S. citizens, for the most part, have allowed their democracy to become a spectator sport. We currently have a President who has withdrawn the United States from the Paris Climate Accord, putting at risk international cooperation to combat global warming and sea level rise, two clear contributing factors to the increasing frequency of the so-called 500-year storm. As David Dayen wrote recently at the New Republic: “The city [Houston] suffered a ‘500-year flood,’ defined as one with a 0.2 percent chance of occurring in a given year based on past experience, in 2015. It had another 500-year flood in 2016. And it’s experiencing something much bigger than a 500-year flood right now. Maybe it’s time to admit that past performance is no longer any indication of future results.” According to a report released last year by the watchdog for Congress, the nonpartisan Government Accountability Office (GAO), an audit showed that the U.S. government can’t reliably report a significant portion of its assets, liabilities, or expenditures. The Department of Defense is one of the largest black holes. The GAO reported that “serious financial management problems at DOD” had “prevented its financial statements from being auditable.” While the U.S. spends more in military outlays than the eight other largest spending countries combined, the leadership in Washington doesn’t feel it needs to account to the public as to where and how billions of dollars in military outlays are being deployed. The public tolerates this insanity.
Senate Rejects Paul’s AUMF Amendment - American Conservative - There was a Senate vote on Rand Paul’s amendment to the 2018 National Defense Authorization Act earlier today. The amendment would have repealed the 2001 and 2002 AUMFs after six months. The Senate voted to table (i.e., kill) the amendment 61-36. Mike Lee of Utah and Dean Heller of Nevada were the only other Republicans voting nay with Paul to keep the amendment alive. 31 Democrats and 2 independents made up the bulk of the members voting nay. Eleven Democrats voted with the Republican majority to kill the amendment. Three senators did not vote. Some of the opponents of the amendment professed to be willing to consider a new, updated authorization, but said that a new authorization couldn’t be crafted in the six-month window afforded by the amendment:But opponents of the measure argued repealing the two war resolutions on such a quick timeline would endanger military operations in Afghanistan and against ISIS in Iraq and Syria and send mixed signals to U.S. troops and allies overseas.“I did not expect that 16 years later we would still be engaged in the evolution of that fight that began on 9/11,” said Senate Armed Services ranking Democrat Jack Reed of Rhode Island. “But we cannot, I think, simply stop, threaten to pull back our legal framework with the expectation that in six months we will produce a new and more appropriate authorization for the use of military force.” Frankly, the complaint that there isn’t enough time to draft and debate a new AUMF is absurd. There is more than enough time to do it if the members considered it a priority, and by hiding behind such thin excuses it is obvious enough that they don’t think it should be one. The original 2001 AUMF was drawn up in a matter of days, so it shouldn’t be so difficult to manage to find a suitable replacement for it in half a year. Indeed, the only way that Congress might be forced to act on this is if the existing AUMFs expired, so leaving them in place just encourages members to abdicate their role in the process. When opponents of Sen. Paul’s amendment claim that there isn’t time to come up with a replacement for the 2001 AUMF, they are really saying that they can’t be bothered to spend their time on it. That’s a weak and unacceptable excuse for shirking their responsibilities.
High Tech Pork: The Pentagon’s New Wonder Weapons for World Dominion - naked capitalism - Yves here. The Pentagon’s fondness for tech gee-whizzery that is way too often circumvented by simpler mechanisms isn’t just producing a more fragile and failure-prone military. It will likely reduce the US’s role as arms merchant. Who will want to buy a gold-plated albatross like the F-35, even if we subsidize the sale? It is literally good for almost nothing. By contrast, Russia has managed to do more with less by adopting a military equipment philosophy that emphases robustness. Think of the AK-47 as the prototype. It is easy to manufacture and assemble, easy to use, and fires reliably in all sorts of nasty conditions. While US Air Force jets are designed to use airstrips at our bases. Russian jets can take off and land in fields. That flexibility translated into combat advantage.
Bombshell Report Catches Pentagon Falsifying Paperwork For Weapons Transfers To Syrian Rebels - A new bombshell joint report issued by two international weapons monitoring groups Tuesday confirms that the Pentagon continues to ship record breaking amounts of weaponry into Syria and that the Department of Defense is scrubbing its own paper trail. On Tuesday the Organized Crime and Corruption Reporting Project (OCCRP) and the Balkan Investigative Reporting Network (BIRN) produced conclusive evidence that not only is the Pentagon currently involved in shipping up to $2.2 billion worth of weapons from a shady network of private dealers to allied partners in Syria - mostly old Soviet weaponry - but is actually manipulating paperwork such as end-user certificates, presumably in order to hide US involvement. The OCCRP and BIRN published internal US defense procurement files after an extensive investigation which found that the Pentagon is running a massive weapons trafficking pipeline which originates in the Balkans and Caucuses, and ends in Syria and Iraq. The program is ostensibly part of the US train, equip, and assist campaign for the Syrian Democratic Forces (SDF, a coalition of YPG/J and Arab FSA groups operating primarily in Syria's east). The arms transfers are massive and the program looks to continue for years. According to Foreign Policy's (FP) coverage of the report:The Department of Defense has budgeted $584 million specifically for this Syrian operation for the financial years 2017 and 2018, and has earmarked another $900 million of spending on Soviet-style munitions between now and 2022. The total, $2.2 billion, likely understates the flow of weapons to Syrian rebels in the coming years.But perhaps more shocking is the following admission that Pentagon suppliers have links with known criminal networks, also from FP: According to the report, many of the weapons suppliers — primarily in Eastern Europe but also in the former Soviet republics, including Kazakhstan, Georgia, and Ukraine — have both links to organized crime throughout Eastern Europe and spotty business records.
The Pentagon’s $2.2 Billion Soviet Arms Pipeline Flooding Syria - The Pentagon is on a spending spree as it scrabbles to amass vast quantities of Soviet-style weapons and ammunition. But it’s running into problems sourcing them, and is using misleading legal documents to disguise their final destination: Syria. The defeat of Islamic State in Syria is reliant on a questionable supply-line, funnelling unprecedented quantities of weapons and ammunition from Eastern Europe to some 30,000 anti-ISIS rebel fighters. Armed with AK-47s and rocket-propelled grenades fresh from state-owned production lines and stockpiles of the Balkans, Central Europe and increasingly the former Soviet Union, these US-backed troops are spearheading the battle to reclaim Raqqa, the capital of the so-called caliphate, and liberate other areas of Syria held by ISIS. But the flow of weapons to these Pentagon-backed militia depends on misleading official paperwork, an investigation by the Balkan Investigative Reporting Network, BIRN, and the Organized Crime and Corruption Reporting Project, OCCRP, has uncovered. The operation has been criticised by arms transfer experts and even worried officials in Berlin, who have seen large quantities of weapons passing through US military bases in Germany on the way to Syria. Reporters have pinpointed more than $700 million of spending on weapons and ammunition likely destined for Syrian rebels since September 2015, when the Pentagon’s anti-ISIS train and equip programme shifted strategy.The Department of Defense has budgeted $584 million specifically for this Syrian operation for the financial years 2017 and 2018, and has earmarked another $900 million of spending on Soviet-style munitions between now and 2022. The total, $2.2 billion, likely understates the flow of weapons to Syrian rebels in the coming years.
North Korea warns US of 'greatest pain in history' if new sanctions are imposed - North Korea has warned it will make the United States pay a heavy price if a proposal Washington is backing to impose the toughest sanctions ever on Pyongyang is approved by the UN Security Council this week. The US has called for a vote on Monday (local time) on the new sanctions, which would be the toughest to date against Kim Jong-un's regime. North Korea's Foreign Ministry issued a statement saying it is watching America's moves, and is "ready and willing" to respond with measures which "will cause the US the greatest pain and suffering it had ever gone through in its entire history". "The US is trying to use [North Korea's] legitimate self-defensive measures as an excuse to strangle and completely suffocate it," the statement said."[North Korea] shall make absolutely sure that the US pays due price ... [and] is ready and willing to use any form of ultimate means." Last Tuesday the US circulated a draft resolution proposing the sanctions, including a ban on all oil and natural gas exports to the country and a freeze on all foreign financial assets of the government and Mr Kim. Security Council diplomats, who weren't authorised to speak publicly because talks have been private, said the US and China were still negotiating the text late on Sunday (local time). Previous UN sanctions resolutions have been negotiated between the US and China, and have taken weeks or months — but Donald Trump's administration is demanding a vote in six days.
US To Propose Watered Down North Korea Sanctions To Appease China And Russia -- In the latest indication that the US is desperate to reach a diplomatic compromise over North Korea, even if it means appeasing Beijing and Moscow, Reuters reports that while the UN Security Council is set to vote on Monday afternoon on a U.S.-drafted resolution to impose new sanctions on North Korea over latest nuclear test, as discussed on Friday, the new draft no longer proposes blacklisting North Korean leader Kim Jong Un, while also dropping a proposed oil embargo - something Beijing had vocally opposed - and instead intends to impose a ban on condensates and natural gas liquids, a cap of 2m barrels a year on refined petroleum products, and a cap on crude oil exports to North Korea at current levels. In short: the US has materially weakened its proposed North Korea sanctions, "in an attempt to appease" Pyongyang’s allies Beijing and Moscow following negotiations over the past few days. In order to pass, a resolution needs nine of the 15 Security Council members to vote in favor and no vetoes by any of the five permanent members — the United States, Britain, France, Russia and China. Some more details:
- the draft resolution no longer proposes an asset freeze on the military-controlled national airline Air Koryo. The new draft resolution also drops a bid to remove an exception for transshipments of Russian coal via the North Korean port of Rajin.
- the new language drops a bid to remove an exception for trans-shipments of Russian coal via the North Korean port of Rajin, and it no longer proposes an asset freeze on the military-controlled national airline Air Koryo
- while the original draft resolution would have authorized states to use all necessary measures to intercept and inspect on the high seas vessels that have been blacklisted by the council, the final draft text calls upon states to inspect vessels on the high seas with the consent of the flag state, if there’s information that provides reasonable grounds to believe the ship is carrying prohibited cargo.
North Korea defiant over U.N. sanctions as Trump says tougher steps needed (Reuters) - North Korea displayed trademark defiance on Wednesday over new United Nations sanctions imposed after its sixth and largest-ever nuclear test, vowing to redouble efforts to fight off what it said was the threat of a U.S. invasion. U.S. President Donald Trump said the sanctions, unanimously agreed on Monday by the 15-member U.N. Security Council, were just a small step toward what is ultimately needed to rein in Pyongyang over its nuclear and missile programs. North Korea’s Foreign Ministry said the resolutions were an infringement on its legitimate right to self-defense and aimed at “completely suffocating its state and people through full-scale economic blockade”. “The DPRK will redouble the efforts to increase its strength to safeguard the country’s sovereignty and right to existence and to preserve peace and security of the region by establishing the practical equilibrium with the U.S.,” it said in a statement carried by the official KCNA news agency. The Democratic People’s Republic of Korea (DPRK) is North Korea’s official name. The statement echoed comments on Tuesday by DPRK’s Ambassador to the United Nations in Geneva, Han Tae Song, who said Pyongyang was “ready to use a form of ultimate means”. “The forthcoming measures ... will make the U.S. suffer the greatest pain it ever experienced in its history,” Han said. The North’s Rodong Sinmun newspaper also accused South Korea of being Washington’s “puppet”, criticizing Seoul’s agreement with the United States to amend an existing bilateral guideline that will now allow the South to use unlimited warhead payloads on its missiles.
North Korea threatens to 'sink' Japan, reduce U.S. to 'ashes and darkness' (Reuters) - A North Korean state agency threatened on Thursday to use nuclear weapons to “sink” Japan and reduce the United States to “ashes and darkness” for supporting a U.N. Security Council resolution and sanctions over its latest nuclear test. The Korea Asia-Pacific Peace Committee, which handles the North’s external ties and propaganda, also called for the breakup of the Security Council, which it called “a tool of evil” made up of “money-bribed” countries that move at the order of the United States. “The four islands of the archipelago should be sunken into the sea by the nuclear bomb of Juche. Japan is no longer needed to exist near us,” the committee said in a statement carried by the North’s official KCNA news agency. Juche is the North’s ruling ideology that mixes Marxism and an extreme form of go-it-alone nationalism preached by state founder Kim Il Sung, the grandfather of the current leader, Kim Jong Un. Regional tension has risen markedly since the reclusive North conducted its sixth, and by far its most powerful, nuclear test on Sept. 3, following a series of missile tests, including one that flew over Japan. The 15-member Security Council voted unanimously on a U.S.-drafted resolution and a new round of sanctions on Monday in response, banning North Korea’s textile exports that are the second largest only to coal and mineral, and capping fuel supplies. The North reacted to the latest action by the Security Council, which had the backing of veto-holding China and Russia, by reiterating threats to destroy the United States, Japan and South Korea. “Let’s reduce the U.S. mainland into ashes and darkness. Let’s vent our spite with mobilization of all retaliation means which have been prepared till now,” the statement said.
US Threatens To Cut Off China From SWIFT If It Violates North Korea Sanctions - In an unexpectedly strong diplomatic escalation, one day after China agreed to vote alongside the US during Monday's United National Security Council vote in passing the watered down North Korea sanctions, on Tuesday the US warned that if China were to violate or fail to comply with the newly imposed sanctions against Kim's regime, it could cut off Beijing’s access to both the US financial system as well as the "international dollar system."Speaking at CNBC's Delivering Alpha conference on Tuesday, Steven Mnuchin said that China had agreed to "historic" North Korean sanctions during Monday's United Nations vote. "We worked very closely with the U.N. I'm very pleased with the resolution that was just passed. This is some of the strongest items. We now have more tools in our toolbox, and we will continue to use them and put additional sanctions on North Korea until they stop this behavior." In response, Andrew Ross Sorkin countered that "we haven't been able to move the needle on China, which seems to be the real mover on this, in terms of being able to apply the real pressure. What do you think the issue is? What is the problem?" The stunner was revealed in Mnuchin's answer: "I think we have absolutely moved the needle on China. I think what they agreed to yesterday was historic. I'd also say I put sanctions on a major Chinese bank. That's the first time that's ever been done. And if China doesn't follow these sanctions, we will put additional sanctions on them and prevent them from accessing the U.S. and international dollar system. And that's quite meaningful." And to underscore his point, the Treasury Secretary also said that "in North Korea, economic warfare works. I made it clear that the President was strongly considering and we sent a message that anybody that wanted to trade with North Korea, we would consider them not trading with us. We can put on economic sanctions to stop people trading."
North Korea crisis: Mnuchin suggests China trade cut-off on the table | Fox News: Treasury Secretary Steve Mnuchin suggested Wednesday that the Trump administration is willing to cut off trade with China in an effort to put pressure on North Korea. “I've worked on an executive order that's ready if the president wants to use it,” Mnuchin said in an interview with Fox News’ Bret Baier. “We can stop trade with any country that does business with North Korea.” China is North Korea’s closest ally and commercial partner. Pressed if the administration is really willing to stop trade with China, Mnuchin replied: “Stopping trade with anybody. Nobody would be off the table.” President Trump issued the same threat earlier this month, posting on Twitter that the United States is considering halting trade with "any country doing business with North Korea." His remarks came after North Korea detonated a thermonuclear device in its sixth and most powerful nuclear test. China responded by saying Trump's threat is unacceptable and unfair. “We're going to be careful in using these tools,” Mnuchin said Wednesday, “but the president is committed. We will use economic sanctions to bring North Korea to the table.” Mnuchin also expressed a desire during the interview to win support from both Republicans and Democrats on a tax reform package.
US demands China take ‘direct action’ after North Korea fires another missile over Japan | South China Morning Post: North Korea fired a missile on Friday that flew over Japan’s northern Hokkaido far out into the Pacific Ocean, further ratcheting up tensions after Pyongyang’s recent test of a powerful nuclear bomb. The missile flew over Japan and landed in the Pacific about 2,000km east of Hokkaido, Japanese Chief Cabinet Secretary Yoshihide Suga said. The launch prompted US Secretary of State Rex Tillerson to demand that China and Russia take “direct actions” against Pyongyang. “China and Russia must indicate their intolerance for these reckless missile launches by taking direct actions of their own,” he said. Hours after Tillerson’s statement, China’s Foreign Ministry said that it opposed North Korea’s use of ballistic missiles in violation of United Nations Security Council resolutions. Foreign Ministry spokeswoman Hua Chunying said China had made enormous sacrifices to implement UN resolutions and that its sincerity could not be doubted.Prime Minister Shinzo Abe said Japan would “never tolerate” what he called North Korea’s “dangerous provocative action that threatens world peace”. “We can never tolerate that North Korea trampled on the international community’s strong, united resolve toward peace that has been shown in UN resolutions and went ahead again with this outrageous act,” Abe said. The missile reached an altitude of about 770km and flew for about 19 minutes over a distance of about 3,700km, according to South Korea’s military – far enough to reach the US Pacific territory of Guam. It was “the furthest overground any of their ballistic missiles has ever travelled”, Joseph Dempsey of the International Institute for Strategic Studies said on Twitter.
"I Know What North Korea Wants" - President Carter Warns "US Oligarchy Refuses To Do It" - (video) Former US President Jimmy Carter repeated his assertion that the US works more like an "oligarchy than a democracy," while also lambasting Trump's "hopeless" approach to the increasing tensions with North Korea. The former president was speaking at a ‘Conversation with the Carters’ event at his Carter Center in Atlanta on Tuesday. AP reports that he said money in politics is what makes the US more like an oligarchy – run by a small group of rich people – rather than a democracy, repeating an allegation he has vociferously uttered for a few years.“[Money in politics] violates the essence of what made America a great country in its political system.Now it’s just an oligarchy with unlimited political bribery being the essence of getting the nominations for President or being elected President. And the same thing applies to governors, and U.S. Senators and congress members.So, now we’ve just seen a subversion of our political system as a payoff to major contributors, who want and expect, and sometimes get, favors for themselves after the election is over." But then the former President went to town on Trump and North Korea... Carter said, “The first thing I would do is treat the North Koreans with respect.”“I know what the North Koreans want,” he said. “What they want is a firm treaty guaranteeing North Korea that the US will not attack them or hurt them in any way, unless they attack one of their neighbors.” Carter said, “But the United States has refused to do that.”Carter said he would send his top person to Pyongyang immediately, adding: “If I didn’t go myself.” The former president visited North Korea three times between 1994 and 2011. "Until we're willing to talk to them and treat them with respect as human beings, which they are, then I don't think we'll make any progress," he said.
North Korea says seeking military ‘equilibrium’ with U.S. (Reuters) - North Korea said on Saturday it aims to reach an “equilibrium” of military force with the United States, which earlier signaled its patience for diplomacy is wearing thin after Pyongyang fired a missile over Japan for the second time in under a month. “Our final goal is to establish the equilibrium of real force with the U.S. and make the U.S. rulers dare not talk about military option,” North Korean leader Kim Jong Un was quoted as saying by the state news agency, KCNA. Kim was shown beaming as he watched the missile fly from a moving launcher in photos released by the agency, surrounded by several officials. “The combat efficiency and reliability of Hwasong-12 were thoroughly verified,” said Kim as quoted by KCNA. Kim added the North’s goal of completing its nuclear force had “nearly reached the terminal”. North Korea has launched dozens of missiles under Kim’s leadership as it accelerates a weapons program designed to give it the ability to target the United States with a powerful, nuclear-tipped missile. After the latest missile launch on Friday, White House National Security Adviser H.R. McMaster said the United States was fast running out of patience with North Korea’s missile and nuclear programs. “We’ve been kicking the can down the road, and we’re out of road,” McMaster told reporters, referring to Pyongyang’s repeated missile tests in defiance of international pressure. “For those ... who have been commenting on a lack of a military option, there is a military option,” he said, adding that it would not be the Trump administration’s preferred choice.
Saudi government allegedly funded a ‘dry run’ for 9/11 -- Fresh evidence submitted in a major 9/11 lawsuit moving forward against the Saudi Arabian government reveals its embassy in Washington may have funded a “dry run” for the hijackings carried out by two Saudi employees, further reinforcing the claim that employees and agents of the kingdom directed and aided the 9/11 hijackers and plotters. Two years before the airliner attacks, the Saudi Embassy paid for two Saudi nationals, living undercover in the US as students, to fly from Phoenix to Washington “in a dry run for the 9/11 attacks,” alleges the amended complaint filed on behalf of the families of some 1,400 victims who died in the terrorist attacks 16 years ago. The court filing provides new details that paint “a pattern of both financial and operational support” for the 9/11 conspiracy from official Saudi sources, lawyers for the plaintiffs say. In fact, the Saudi government may have been involved in underwriting the attacks from the earliest stages — including testing cockpit security. “We’ve long asserted that there were longstanding and close relationships between al Qaeda and the religious components of the Saudi government,” said Sean Carter, the lead attorney for the 9/11 plaintiffs. “This is further evidence of that.” Lawyers representing Saudi Arabia last month filed a motion to dismiss the lawsuit, which may finally be headed toward trial now that Congress has cleared diplomatic-immunity hurdles. A Manhattan federal judge has asked the 9/11 plaintiffs, represented by lead law firm Cozen O’Connor, to respond to the motion by November.Citing FBI documents, the complaint alleges that the Saudi students — Mohammed al-Qudhaeein and Hamdan al-Shalawi — were in fact members of “the Kingdom’s network of agents in the US,” and participated in the terrorist conspiracy. They had trained at al Qaeda camps in Afghanistan at the same time some of the hijackers were there. And while living in Arizona, they had regular contacts with a Saudi hijacker pilot and a senior al Qaeda leader from Saudi now incarcerated at Gitmo. At least one tried to re-enter the US a month before the attacks as a possible muscle hijacker but was denied admission because he appeared on a terrorist watch list.
The Saudi Trillions - LRB - It made perfect sense that the first port of call on President Trump’s first foreign trip, in May, was Riyadh. Saudi Arabia – the world’s second largest oil producer (after Russia), the world’s biggest military spender as a proportion of GDP, the main sponsor of Islamist fighting groups across Afghanistan, Pakistan, Syria and Iraq, the leader of a coalition in a devastating war against Yemeni rebels now in its third year – is a country one can do business with, even as the most ardent Kremlinologists in the West struggle to understand it. It is a place often defined by its contradictions, in which tribal codes of desert and oasis – puritanical, patriarchal, frugal and austere – co-exist and frequently clash with lavish displays of wealth and such emblems of modernity as air-conditioned shopping malls, designer boutiques and six-lane highways flashing with supercharged vehicles exclusively driven by men. Trump returned from his visit with a promise – he claimed – of $350 billion in Saudi spending on American armaments over the next ten years, with $110 billion right away, of benefit particularly to Boeing, Lockheed Martin and Raytheon. The State Department celebrated the deal as supporting ‘the long-term security of Saudi Arabia and the Gulf region in the face of malign Iranian influence and Iranian-related threats’. But the last few months have seen a series of changes in the kingdom that make its future more unpredictable than ever. At the beginning of June, Saudi Arabia severed diplomatic ties with its neighbour Qatar, demanding that its al-Jazeera network be shut down for broadcasting propaganda and launching a regional stand-off that is far from being resolved. Then, two weeks later, there was what appeared to be a palace coup. On 21 June the doting king promoted his favourite son, the 31-year-old Prince Mohammed bin Salman (widely known by the initials MBS), to the position of crown prince, putting him in line to be the first of the third generation – Ibn Saud’s grandsons – to occupy the throne. According to the New York Times, MBS’s elevation at the expense of his older cousin, Crown Prince Muhammad bin Nayef (known as MBN), was the result of a well-executed plot. MBN had been highly regarded by the US and its allies: as head of the interior ministry and chief of Saudi intelligence he presided over operations against al-Qaida in the Arabian Peninsula (AQAP); he had attended training sessions with the FBI and was a powerful advocate of continued close relations with the Americans.
Trump to weigh more aggressive U.S. strategy on Iran (Reuters) (Reuters) - President Donald Trump is weighing a strategy that could allow more aggressive U.S. responses to Iran’s forces, its Shi‘ite Muslim proxies in Iraq and Syria, and its support for militant groups, according to six current and former U.S. officials. The proposal was prepared by Defense Secretary Jim Mattis, Secretary of State Rex Tillerson, national security adviser H.R. McMaster and other top officials, and presented to Trump at a National Security Council meeting on Friday, the sources said. It could be agreed and made public before the end of September, two of the sources said. All of the sources are familiar with the draft and requested anonymity because Trump has yet to act on it. In contrast to detailed instructions handed down by President Barack Obama and some of his predecessors, Trump is expected to set broad strategic objectives and goals for U.S. policy but leave it to U.S. military commanders, diplomats and other U.S. officials to implement the plan, said a senior administration official. “Whatever we end up with, we want to implement with allies to the greatest extent possible,” the official added. The White House declined to comment. The plan is intended to increase the pressure on Tehran to curb its ballistic missile programs and support for militants, several sources said.
US extends Iran sanctions relief while bemoaning behavior - ABC News - The Trump administration on Thursday extended sanctions relief to Iran, avoiding imminent action that could implode the landmark 2015 nuclear deal, even as President Donald Trump and Secretary of State Rex Tillerson accused Tehran of not respecting the entire agreement. The extensions of the waivers on nuclear sanctions, first issued by the Obama administration, were accompanied by new penalties imposed against 11 Iranian people and companies accused of supporting Iran's ballistic missile program or involvement in cyber-attacks against the U.S. financial system. The combination of steps — known internally as "waive and slap" — came as the administration nears completion of a months long review of its Iran policy that is expected next month, perhaps as early as October 15 when Trump must inform Congress if Iran is complying with the terms of the nuclear agreement and whether the deal remains in U.S. national security interests. In comments to reporters aboard Air Force One, Trump repeated his campaign pronouncement that the deal is bad and again said he believes Iran is violating its terms and spirit. "The Iran deal is one of the worst deals I've ever seen," he said. "Not a fair deal to this country. It's a deal that should have never ever been made. You'll see what we're doing ... it's going to be in October." "We are not going to stand for what they are doing to this country," Trump said. "They have violated so many elements but they have also violated the spirit of that deal."
Mystery of sonic weapon attacks at US embassy in Cuba deepens - The blaring, grinding noise jolted the American diplomat from his bed in a Havana hotel. He moved just a few feet, and there was silence. He climbed back into bed. Inexplicably, the agonizing sound hit him again. It was as if he’d walked through some invisible wall cutting straight through his room. Soon came the hearing loss, and the speech problems, symptoms both similar and altogether different from others among at least 21 US victims in an astonishing international mystery still unfolding in Cuba. The top US diplomat has called them “health attacks”. New details learned by the Associated Press indicate at least some of the incidents were confined to specific rooms or even parts of rooms with laser-like specificity, baffling US officials who say the facts and the physics don’t add up. Suspicion initially focused on a sonic weapon, and on the Cubans. Yet the diagnosis of mild brain injury, considered unlikely to result from sound, has confounded the FBI, the state department and US intelligence agencies involved in the investigation. Some victims now have problems concentrating or recalling specific words, several officials said, the latest signs of more serious damage than the US government initially realized. The United States first acknowledged the attacks in August – nine months after symptoms were first reported. The Trump administration still hasn’t identified a culprit or a device to explain the attacks. In fact, almost nothing about what went down in Havana is clear. Investigators have tested several theories about an intentional attack: by Cuba’s government, a rogue faction of its security forces, a third country like Russia or some combination thereof. Yet they’ve left open the possibility an advanced espionage operation went horribly awry, or that some other, less nefarious explanation is to blame. The cases vary deeply: different symptoms, different recollections of what happened. Some felt vibrations, and heard sounds – loud ringing or a high-pitch chirping similar to crickets or cicadas. Others heard the grinding noise. Some victims awoke with ringing in their ears and fumbled for their alarm clocks, only to discover the ringing stopped when they moved away from their beds.
North Korea Crisis No Reason to Preserve Failed Trade Deal; U.S. Exports to South Korea Dropped, Deficit Nearly Doubled Since Pact -- Lori Wallach, Public Citizen pdf - “How to peacefully resolve North Korea’s nuclear escalation is a thorny question, but what should happen with the 2012 U.S.-South Korea Free Trade Agreement is an entirely separate question that is not complicated. We opposed the U.S.-Korea Free Trade Agreement in 2011 when it came before Congress because we knew that any deal that has at its heart new rights and powers for corporations to offshore jobs, raise medicine prices and attack environmental, health and financial stability safeguards is bad for people and the planet. In its five years in effect, this U.S.-Korea trade agreement proved even worse than expected. The unique outcome is that U.S. exports to South Korea actually declined after the pact was implemented. As with most other U.S. FTAs, imports into the United States soared. Thus, the U.S. goods trade deficit with Korea increased by 85 percent in five years. U.S. average monthly exports to South Korea have fallen in nine of the 15 U.S. sectors that export the most to South Korea, relative to the year before the FTA. U.S. exports to South Korea of agricultural goods have even fallen 5.4 percent in the first five years of the FTA. Claims that U.S.-Korean cooperation on a mutually shared existential priority will somehow be undermined by cancelation of a trade deal that has done the opposite of what was promised is absurd. The 28,000 U.S. troops stationed in Korea are just one demonstration of U.S. support for South Korea and commitment to its defense. Hysterical foreign policy arguments are always the claim of last resort in support of a failed trade agreement, and time and again they have proved meritless. Given the broad public opposition to the FTA in Korea, ending a deal negotiated in secret with 500 official U.S. advisers representing corporate interests would be viewed by many in Korea outside the foreign policy elite as good news.”
New NAFTA must terminate corporate kangaroo courts | TheHill: Entrepreneurs gathering in Washington for the U.S. Chamber of Commerce Small Business Summit, please beware. By pushing for a little-known but damaging legal concept buried in the North American Free Trade Agreement (NAFTA), the chamber has chosen to represent the interests of a handful of corporations instead of the interests of responsible business owners who are focused on the needs of their local communities and the environment. As networks representing thousands of responsible business owners, we have advocated strongly that any NAFTA renegotiations must remove the pact’s controversial provisions that incentivize job offshoring and empower foreign corporations to challenge sovereign U.S. laws. These provisions fall under the "Investor-State Dispute Settlement" (ISDS), and they grant greater rights to foreign corporations than to domestic businesses and governments. ISDS allows foreign corporations to sue the U.S. government before a panel of three corporate lawyers who can award the corporations unlimited sums to be paid by taxpayers, including for the loss of expected future profits. The corporations need only convince the lawyers that an American law, safety regulation, environmental standard or court ruling violates the special rights and privileges granted to them under NAFTA. The lawyers’ decisions are not subject to appeal. Many of these lawyers rotate between serving on tribunals that decide cases and attacking governments on behalf of corporations. Such conflicts of interest are forbidden as highly unethical in most legal systems.It’s hard to believe this Orwellian power grab is real, but it is. Multinational corporations already have pocketed $392 million from North American taxpayers under NAFTA ISDS attacks on toxic bans, environmental and public health policies and more. Tens of billions of dollars are pending in ongoing NAFTA cases. But the U.S. Chamber of Commerce has made it a top priority to urge the Trump administration to not only keep these controversial ISDS provisions in NAFTA but to expand their scope and coverage.
Trump scrambles tax reform debate | TheHill: President Trump is scrambling the politics of tax reform. Republicans in Congress have been driving the process with little input from Democrats, but Trump's surprise debt-and-spending pact this week has both parties wondering if things are about to change.The president’s comments and those by White House Press Secretary Sarah Huckabee Sanders on Friday give an opening for Democrats. "The president is committed to moving legislation through," Sanders said. "He wants Congress to act. He's happy to have Democrats be part of that.” A tax code revamp anchored by deep tax cuts has taken on more political importance after the GOP failure to repeal ObamaCare, with the president craving a big legislative win before the end of the year. Trump repeated his desire for the GOP to get moving on Friday. “Republicans must start the Tax Reform/Tax Cut legislation ASAP. Don't wait until the end of September,” Trump tweeted. “Needed now more than ever. Hurry!” At a Cabinet meeting at Camp David on Saturday, Trump said that he wants a "speed up" of tax reform because of Hurricane Irma. "I wanted a speed up anyway, but now we need it even more so," he said.
Ryan throws cold water on Trump tax goal | TheHill: House Speaker Paul Ryan (R-Wis.) on Thursday said that President Trump’s goal of lowering the corporate tax rate to 15 percent would be difficult to achieve. “The numbers are hard to make that work,” Ryan said at an event hosted by The New York Times. Ryan said that his goal is to lower the corporate tax rate from 35 percent to at least the average for industrialized countries, 22.5 percent. “Our goal is to get in the mid-to-low 20s, and we think that that’s an achievable goal,” he said. The corporate rate has been the source of considerable debate as Republicans seek to overhaul the tax code.In a speech in North Dakota Wednesday, Trump said that “ideally, we would like to bring our business tax rate down to around 15 percent.” House Freedom Caucus Chairman Mark Meadows (R-N.C.) has also said that he would like the corporate tax rate to be in the teens. But others, including Senate Finance Committee Chairman Orrin Hatch (R-Utah), have agreed with Ryan that slashing the rate to 15 percent would be challenging. If lawmakers want to lower tax rates without significantly increasing the deficit, they will have to find ways to offset the revenue losses. Amid a crowded legislative scheduled, Ryan said that he still wants to pass tax-reform legislation this year, calling it “an enormous game-changer economically for our country.” The Speaker said that the congressional tax-writing committees are “very close” to releasing their “template,” and after that they would move legislation through their panels.
Trump tests the waters for bipartisan tax reform with White House dinner - Trump out and three dined with him Tuesday evening to see if there is common ground on issues like retirement security and stopping the offshoring of jobs. The senators — Joe Manchin of West Virginia, Heidi Heitkamp of North Dakota and Joe Donnelly of Indiana — see little political downside in trying to hammer out a tax deal with Trump, given that they all face voters next year in states the president won handily. Story Continued Below “I wasn’t sent here to pick and choose who I want to work with. I was sent here to do the job for my state of West Virginia,” Manchin told reporters before the dinner. For Trump, bringing the trio to the White House was his biggest step yet in reaching out to Democrats on the one major issue he and fellow Republicans might still score a victory on this year after the collapse of their efforts to repeal and replace Obamacare. At the same time, it could be a wake-up call to Republicans still smarting from his deal with Democrats to temporarily raise the debt ceiling and fund the government into December. Trump will continue his outreach on Wednesday, when he is planning to meet with a bipartisan group of lawmakers. Rep. Josh Gottheimer (D-N.J.), who heads the bipartisan Problem Solvers Caucus, said White House Director of Legislative Affairs Marc Short reached out to members to set up the meeting.Short said at a Christian Science Monitor breakfast on Tuesday that Trump wanted bipartisan support for a tax plan, after finding that Republicans were “not reliable” when it came to repealing Obamacare. "We don't feel like we can assume that we can get tax reform done strictly on a partisan basis," he said.
Trump Plans Aggressive Road Show to Sell Tax Overhaul -- President Donald Trump plans an aggressive travel schedule, taking him to as many as 13 states over the next seven weeks, to sell the idea of a tax overhaul as the administration tries to avoid repeating the communications failures of its attempt to repeal Obamacare. With a make-or-break legislative battle looming on taxes, the White House is moving to clean up a disorganized communications operation, said four people familiar with the effort. The strategy was revealed by top advisers to about 40 allies during a closed-door meeting last week. It calls for the president to visit states he won where a Democratic senator is up for re-election next year, including Florida, Indiana, Michigan, Montana, Ohio and Pennsylvania, said three people who attended. The people asked not to be identified discussing internal strategy. In some instances, cabinet members will be deployed behind Trump in a “second wave” after the president’s speeches and town hall meetings to amplify his message. White House officials held the private meeting on Sept. 8 to share details on its political strategy for tax legislation with allies who can deliver the message on cable news and in local media interviews. Separately, they’re prepping economists such as Arthur Laffer, Lawrence Kudlow and Stephen Moore, who served as informal advisers to Trump’s campaign. Top communications staffers were at the meeting, including White House communications director Hope Hicks, counselor Kellyanne Conway, press secretary Sarah Huckabee Sanders and Cliff Sims, a messaging strategist. The administration plans to mount the full-bore sales campaign even though congressional Republicans and the White House haven’t yet determined key elements of the plan, including tax brackets for individuals, a corporate tax rate, what popular tax advantages will be eliminated or even whether the changes will be permanent or temporary. It’s unclear when additional details will emerge.
This Is the Crazy Tax Math Trump Must Master, Fast -- President Trump vows to cut the corporate tax rate from 35 percent to 15 percent. Suppose Republicans could raise $2 trillion to pay for cuts (not an easy task). That would require hiking other taxes or ending popular deductions. And it can’t all go to corporate giants, so let’s say $1 trillion goes to individuals and $500 billion goes to business owners taxed as individuals. That leaves $500 billion, enough to slash the corporate rate all the way to … 30 percent. The math makes clear that Trump’s 15 percent rate is impossible. But by putting out an extreme number, the president has shifted the terms of the debate, making everyone proposing smaller cuts look timid. At the same time, he’s reaching out to Democrats; on Sept. 12, he invited three key senators to dinner at the White House. It’s the art of the deal as Trump prepares to embark on a multicity tour to sell a tax plan that doesn’t exist yet. The president, who once said taxes “are going to be so easy” in comparison to health care, probably won’t achieve fundamental tax reform in 2017. But he never did show much enthusiasm for making the painful compromises that true reform requires. What he might come away with is a package of voter-pleasing tax cuts that expand the federal deficit while requiring Congress to bend the budget-balancing rules it set for itself. The tax fight, like the one over health care, will pit Republican against Republican. Some, like Trump, want big tax cuts; others, like Speaker of the House Paul Ryan, want any revenue reductions offset by increases to keep budget deficits from growing. Some stress cutting the corporate rate; others want to make sure that the middle class gets a big piece of the action. Some say tax reductions must be permanent; others don’t consider that essential. Some want to cut a deal with Democrats; others say the GOP should rely solely on its fragile majorities in the House and Senate. And the fight over which prized tax loopholes to limit is bound to get ugly. Making matters worse, the government’s need for revenue is increasing. Emergency federal aid to hurricane victims in Texas and Florida tops the list of new priorities. Defense hawks want more money for the Pentagon. The quid pro quo could be more spending on nondefense items. “The deficit’s going to go up. The question is how much,”
Tax Reform Breakthrough? Trump To Host White House Dinner With Schumer, Pelosi - Today's reincarnation of the "Trump Rally", manifested by a jump in small-cap stocks, which as a reminder are the best equity proxy for the future of the US economy, and a long-overdue spike in US dollar... ... is due to the previously observed spark in Trump tax plan talk, whose outline Paul Ryan said earlier could be unveiled as soon as September 25, as well as a report that Trump's tax reform discussions would include Senate Democrats. Now, adding to the speculation that Trump may actually pull off another deal with Democrats over GOP objections, is a report from ABC that one week after allying himself with Democratic congressional leadership on efforts to raise the debt limit and provide money for hurricane relief, on Wednesday night Trump will host top Democrats, Senate and House Minority Leaders Chuck Schumer and Nancy Pelosi for dinner at the White House to discuss DACA, health care reform along with "fall deadlines" - two points that have become Democrat bargaining chips for Trump's agenda. While not explicitly mentioned, Trump will certainly also discuss his proposed tax plan. More details on tonight's meeting from ABC:The focus of Wednesday's dinner, according to sources familiar with the meeting, will be to discuss protections for so-called Dreamers, undocumented immigrants currently protected by the Deferred Action for Childhood Arrivals (DACA) policy, which the administration said last week it would end in six months. The trio will also talk about efforts to stabilize health care markets.The dinner will follow a bipartisan roundtable between a number of leading moderate House Democrats with Trump Wednesday afternoon. Rep. Josh Gottheimer, D-N.J., a leader of the House Problem Solvers Caucus, said the White House legislative affairs office invited him and other members to discuss health care, tax reform and infrastructure Wednesday afternoon. "I'm hoping this is part of a new era of bipartisanship. Because that's what people want," he said.
GOP shudders as Trump courts Democrats on taxes - POLITICO: President Donald Trump’s courtship of Democrats on tax reform is dividing congressional Republicans on the merits of a bipartisan bill — and could upend the party-line strategy that White House and GOP leaders have been pursuing for months. Trump has talked tax reform with two bipartisan groups of senators and House members since Tuesday, dining with swing state Democrats and hobnobbing with centrists in the lower chamber. He told them he wants their votes on a tax bill, even entertaining a Democratic request to raise taxes on wealthier individuals. “If they have to go higher, they’ll go higher, frankly,” Trump told reporters Wednesday just before his meeting with the House Problem Solvers Caucus, a cluster of moderate Republicans and Democrats pushing him for a bipartisan tax bill. Raising taxes on the rich is the polar opposite of supply-side economics espoused by Republicans. Indeed, while GOP leaders welcome Democratic votes on tax reform, they’re loath to compromise on key provisions of their plan. Tax decision-makers in the “Big Six” — House Speaker Paul Ryan, Senate Majority leader Mitch McConnell, Treasury Secretary Steven Mnuchin, White House economic adviser Gary Cohn and the GOP chairmen of the House and Senate tax-writing committees — opted months ago to pursue a partisan tax bill, all but writing off Democrats. They aim to pursue tax reform via budget “reconciliation,” a procedural tool that allows them to evade a 60-vote threshold in the Senate, where the GOP controls just 52 seats. Now, GOP leaders and conservative lawmakers are warning that a Trump alliance with Democrats could upend all those plans.
The GOP Wants to Crack Down on Tax Evasion — Among the Working Poor - Congressional Republicans claim to believe that the deficit must be cut; the tax filing process, simplified; and the poor, given incentives to escape poverty through hard work. Sardonic liberal bloggers, by contrast, claim that the congressional GOP believes in (virtually) nothing, save the Über-wealthy’s god-given right to their pretax income. In late July, House Republicans decided to settle this dispute in the latter’s favor: In an undercovered committee report, Paul Ryan’s caucus introduced a plan to expand the deficit; make tax filing more arduous for low-income families; reduce the rewards of employment for the working poor; and make it easier for billionaires to evade taxes — all at the same time! Catherine Rampell puts a spotlight on the measure in an excellent Washington Post column:Sometime in the next few weeks, the House is expected to vote on the fiscal 2018 budget resolution, a procedural step that’s designed to pave the way for tax cuts. That’s gotten a fair amount of coverage, of course. Less publicized is troubling language in the budget resolution committee report, which proposes decreasing “improper” [Earned Income Tax Credit] payments by requiring verification of all income before benefits go out.The language is vague but appears to refer to a Heritage Foundation proposal that would require the IRS to “fully verify income through a review of Form W-2, Form 1099, business licensing or registration, and relevant invoices” before dispensing any refunds. So, a mini-audit. Paul Ryan has spent much of this year telling voters he wants to make their taxes so simple they can file them on the back of a postcard. Meanwhile, his party is trying to radically increase the amount of administrative work that low-income Americans must do, in order to qualify for the Earned Income Tax Credit (a subsidy that increases the take-home earnings of low-income workers, thereby increasing their incentive to join the labor force). In the case of some self-employed, “gig economy” workers, this new policy would actually make filing for the EITC literally impossible, as the Center for Budget and Policy Priorities explains in a new report:
A Former DACA Recipient Explains All the Data ICE Can Use to Go After Dreamers - To stay in America, millions of undocumented immigrants turned over their personal details to the government on the promise Washington wouldn't use it against them. Now, Trump has betrayed that promise. Julián Gustavo Gómez knew it would happen. Weeks after Trump's election in 2016, The Washington Post published an op-ed from Gómez in which he asked the Obama administration to delete the DACA database. He knew Trump would use it as a weapon. On September 5, Attorney General Jeff Sessions announced the end of the Consideration of Deferred Action for Childhood Arrivals (DACA). In six months, the program will end and 800,000 dreamers and millions more potential dreamers will face detention and deportation. Worse, Washington has an amazing tool to help it target and deport DACA recipients—a US Customs and Immigration Services (USCIS) database filled with the personal details of both DACA recipients and applicants, who volunteered this information under the Obama administration in order to gain a kind-of legal status. To receive DACA status, undocumented immigrants had to pay more than $400 and fill out lengthy forms about themselves and their families. They went down to a government office and let officials fingerprint them and take their picture. Basically, the Trump administration has everything it needs to find and deport the dreamers. The very tool Washington used to shield them may soon become a weapon against them. USCIS had promised to wall off the data from other federal agencies, but that changed when Trump took office. "Information provided to USCIS in DACA requests will not be proactively provided to ICE and CBP for the purpose of immigration enforcement proceedings, unless the requestor meets the criteria for the issuance of a Notice To Appear or a referral to ICE under the criteria set forth in USCIS' Notice to Appear guidance," DHS said in a prepared statement. Gómez saw all of this coming and he warned the U.S. about it in the days after Trump's election. Motherboard caught up to him on the phone after Sessions announced the end of DACA.
Watch What Trump Does, Not What He Says. He May Not Actually End DACA - Some 800,000 people brought to the United States as children without proper authorization had their lives thrown into limbo on Tuesday when the Trump administration said that it would eventually be ending a 4-year-old program that affords them legal protections.“The program known as DACA, that was effectuated under the Obama administration, is being rescinded,” Attorney General Jeff Sessions told reporters, ending the program but implementing a six-month delay before protections are taken away.The run-up to the announcement played out with the “will-he-or-won’t-he” formulaic drama of a reality TV show, only with real lives at stake. Trump used the suspense of whether the he would kick the “Dreamers” off the island to drive ratings. The move was both a fulfillment of a campaign pledge and a broken promise Trump made to DACA recipients because of the variety of public statements Trump has made on the issue.On Sunday night, a news item in Politico sparked early public pushback to the yet-to-be-made announcement canceling the Obama administration’s Deferred Action for Childhood Arrivals program, which indefinitely put off deportation for young immigrants in the country without authorization. “Trump has decided to end the Obama-era program that grants work permits to undocumented immigrants who arrived in the country as children,” Politico reported.The story, however, added: “In a nod to reservations held by many lawmakers, the White House plans to delay the enforcement of the president’s decision for six months, giving Congress a window to act, according to one White House official.” It wasn’t just a nod to lawmakers, though — it was a nod to Trump himself, who has since the election repeatedly assured DACA recipients that they would be safe under his administration. And, despite Trump’s threats to the contrary, they may still be.
Pelosi and Schumer Say They Have Deal With Trump to Replace DACA — Democratic leaders on Wednesday night declared that they had a deal with President Trump to quickly extend protections for young undocumented immigrants and to finalize a border security package that does not include the president’s proposed wall. The Democrats, Senator Chuck Schumer and Representative Nancy Pelosi, said in a joint statement that they had a “very productive” dinner meeting with the president at the White House that focused on the program known as Deferred Action for Childhood Arrivals, or DACA. “We agreed to enshrine the protections of DACA into law quickly, and to work out a package of border security, excluding the wall, that’s acceptable to both sides,” they said. But on Thursday morning, the president contradicted the Democrats, saying no deal had been struck. (Read that article.)In a statement on Wednesday night, the White House was far more muted, mentioning DACA as merely one of several issues that were discussed, including tax reform and infrastructure. It called the meeting, which came a week after the president struck a stunning spending-and-debt deal with the Democratic leaders, “a positive step toward the president’s strong commitment to bipartisan solutions.” But the bipartisan comity appeared to have its limits. In a tweet, Sarah Huckabee Sanders, the White House press secretary, disputed the Democrats’ characterization of Mr. Trump’s stance on the border wall. “While DACA and border security were both discussed, excluding the wall was certainly not agreed to,” she wrote. Mr. Schumer’s communications director, Matt House, fired back on Twitter: “The President made clear he would continue pushing the wall, just not as part of this agreement.” Hard-liners in Congress were flummoxed by word of a potential deal on DACA, one that could push some of Mr. Trump’s electoral base away from him. Representative Steve King, Republican of Iowa, wrote on Twitter that if the reports were true, “Trump base is blown up, destroyed, irreparable, and disillusioned beyond repair. No promise is credible.” The website Breitbart, run by Mr. Trump’s former chief strategist, Stephen K. Bannon, had the headline “Amnesty Don.”
Schumer, Pelosi Announce Deal With Trump: DACA For Border Security, But No Wall -- Shortly after concluding their dinner with president Trump at the White House, top Democrats Chuck Schumer and Nancy Pelosi announced they have reached a deal with Donald Trump which will preserve DACA and shield about 800,000 young "Dreamers" from deportation, while agreeing to border security but without the president's proposed border wall as a condition. Schumer and Pelosi issued the following joint statement following a dinner with President Trump in the White House:"We had a very productive meeting at the White House with the President. The discussion focused on DACA. We agreed to enshrine the protections of DACA into law quickly, and to work out a package of border security, excluding the wall, that's acceptable to both sides."We also urged the President to make permanent the cost-sharing reduction payments, and those discussions will continue."Among the other items discussed were tax reform, border security, infrastructure, trade and the DACA program, which Trump rescinded last week, but now appears to have been reincarnated.Earlier on Wednesday evening, Paul Ryan told House Democrats Wednesday that there's no chance Republicans will pass a replacement for DACA without including border security provisions. President Trump and Ryan have both said Congress should act on DACA, the Obama-era program that allows some illegal immigrants who arrived in the U.S. as children to remain and apply for work permits, leading to some speculation that leadership would support a "clean" bill restoring those protections. Ryan made clear that's not going to happen. According to Axios, none of the Democrats pushed back against the border security proposal. Still, there may be complications. Here are some hot takes on the "deal" from Politico's Jake Sherman:keep in mind that Pelosi and Schumer are both in the minority and need cooperation from ryan/McConnell.House leaves tomorrow and doesn't return till last week of the month so we'll have to see how this progresses.This will pose challenges for ryan and McConnell. Ryan has said he would not pursue immigration legislation without majority of Rs. There will be internal pressure for ryan and McConnell to resist turning over majority to a president who has decided to work w minority.
Ryan rules out DACA replacement without border security measures -- Paul Ryan told House Democrats Wednesday that there's no chance Republicans will pass a replacement for DACA without including border security provisions. President Trump and Ryan have both said Congress should act on DACA, the Obama-era program that allows some illegal immigrants who arrived in the U.S. as children to remain and apply for work permits, leading to some speculation that leadership would support a "clean" bill restoring those protections. Ryan made clear that's not going to happen. AshLee Strong, a spokeswoman for Ryan, said: "This afternoon the speaker and majority leader met with a number of House Democrats at their request to discuss DACA, and they reiterated that any solution needs to address border security and enforcement, which are the root causes of the problem. Discussions among the Republican conference will continue in the coming weeks." A source familiar with the meeting said none of the Democrats pushed back against the border security proposal, leading Republicans to conclude Democrats were begrudgingly accepting this reality.
Trump says he's 'fairly close' to deal on young immigrants - — President Donald Trump on Thursday said he was "fairly close" to a deal with congressional leaders to preserve protections for young immigrants living illegally in America but he's insisting on "massive border security" as part of any agreement. Trump, speaking to reporters before surveying hurricane damage in Florida, pushed back against Democratic leaders who claimed there was a deal on the Deferred Action for Childhood Arrivals (DACA) initiative. He also said his promised wall along the U.S.-Mexico border would "come later." "We're working on a plan subject to getting massive border controls. We're working on a plan for DACA. People want to see that happen," Trump said. He added: "'I think we're fairly close but we have to get massive border security." After he landed in Florida, he declared repeatedly, "If we don't have a wall, we're doing nothing." Trump, in a series of early morning tweets, disputed the characterization of a private White House dinner on Wednesday night by his guests, Sen. Chuck Schumer of New York and Rep. Nancy Pelosi of California, the top Democrats on Capitol Hill. Trump said there was no deal. But speaking on the Senate floor Thursday morning, Schumer insisted that both sides were in agreement and there was no dispute. "If you listen to the president's comments this morning ... it is clear that what Leader Pelosi and I put out last night was exactly accurate," said Schumer. "We have reached an understanding on this issue. We have to work out details, and we can work together on a border security package with the White House and get DACA on the floor quickly." Indeed, in the face of ferocious pushback from conservative lawmakers and media outlets including Breitbart, run by former Trump adviser Steve Bannon, the White House appeared focused more on reshaping presentation of the agreement, than on denying it outright. "By no means was any deal ever reached," White House spokeswoman Lindsay Walters told reporters aboard Air Force One as the president traveled to Florida. "This is something that Congress needs to work on"
Schumer, Pelosi Announce Deal With Trump: DACA For Border Security, But No Wall -- Shortly after concluding their dinner with president Trump at the White House, top Democrats Chuck Schumer and Nancy Pelosi announced they have reached a deal with Donald Trump which will preserve DACA and shield about 800,000 young "Dreamers" from deportation, while agreeing to border security but without the president's proposed border wall as a condition.
Right "Explodes In Anger" Over Trump's New Immigration Push -- Trump's base woke up to a fairly surprising flip-flop this morning from the White House on DACA and the infamous, beautiful border wall which was discussed repeatedly on the campaign trail throughout 2016. It all started when Chuck Schumer and Nancy Pelosi released the following statement after their White House dinner with the President last night:"We had a very productive meeting at the White House with the President. The discussion focused on DACA. We agreed to enshrine the protections of DACA into law quickly, and to work out a package of border security, excluding the wall, that's acceptable to both sides."That statement was followed up by a tweet storm (we covered it here) from the President this morning which seemingly revealed his complete support for DACA and referred to 'The Wall' as a "renovation of old and existing fences and walls" rather than the "physically imposing" yet "aesthetically pleasing" structure that he repeatedly promised his supporters. The apparent flip flop by the President resulted in an immediate backlash from some of his most vocal supporters with Ann Coulter wondering aloud over twitter, "at this point, who DOESN'T want Trump impeached?"
Dreamers Dreaming Dreams -- Kunstler - Personally, I think it would be cruel to deport fully acculturated and Americanized young adults to Mexico and Central America. But there should be no question that it’s up to congress to figure out what to do about the DACA kids, and put it into coherent law. The Golden Golem of Greatness was correct to serve the ball into congress’s court. The suave and charming Mr. Obama only punted the action on that problem, and rather cynically too, I suspect, since he knew the next president would be stuck with it. It’s hard to overcome the sentimental demagoguery this quandary fetches up. The so-called Dreamers are lately portrayed in the media as a monoculture of spectacularly earnest high-achievers, all potential Harvard grads, and future Silicon Valley millionaires working tirelessly to add value to the US economy. This, again personally, I doubt , and there’s also room to doubt that they are uniformly acculturated and Americanized as claimed by the journalists cherry-picking their stories to support the narrative that national borders and immigration laws are themselves cruel anachronisms that need to be opposed. That Dem / Prog narrative has been suspiciously hypocritical for years — the insistence on referring to anybody here illegally as “undocumented,” as if their citizenship status was due to a mere clerical error, and also the obvious pandering for votes among the fast-growing Hispanic demographic by pretending that boundaries shouldn’t matter. Trump’s infamous “wall” is actually just a metaphor for a political faction that believes boundaries do matter, especially in law, where ambiguity is a vice. That narrative is also at odds with the Left’s multicultural principle, since their plea for the DACA kids rests on the idea that they’ve assimilated successfully into the very American common culture that multiculturalism opposes. The DACA poster kids exhibited on the cable news networks speak English as fluently as Anderson Cooper and Don Lemon. Yet the Left so strenuously opposes the idea that speaking English correctly has any importance that they have allowed several generations of American black ghetto kids to fail academically in inner city schools where language skills are deliberately neglected to avoid offending the underspeeched. In fact, these days anyone who proposes that correct English speech matters in America is automatically branded with the scarlet “R” for racist. Except, now it matters where the Dreamers are concerned.
Judge blocks Justice Department move against sanctuary cities - A federal judge has blocked the Trump administration's attempt to use Justice Department public-safety grant programs to discourage so-called sanctuary city policies aimed at protecting undocumented immigrants. Acting on a lawsuit brought by the City of Chicago, U.S. District Court Judge Harry Leinenweber issued a nationwide preliminary injunction Friday prohibiting the Justice Department from adding new grant conditions requiring cities to allow immigration agents access to local jails and insisting that local authorities give advance notice when suspected illegal immigrants are about to be released from custody. "Congress may well have Spending Clause power to impose the conditions or delegate to the Executive Branch the power to impose them, including the notice and access condition, but it must exert that power through statute," wrote Leinenweber, a Reagan appointee. "The Executive Branch cannot impose the conditions without Congressional authority, and that authority has not been conferred" by the statutory provision Justice Department lawyers cited, the judge said. In a 41-page opinion, Leinenweber found that those new conditions "violate the separation of powers doctrine" delegating lawmaking authority to Congress. He said he was applying his order nationally because there was "no reason to think that the legal issues present in this case are restricted to Chicago or that the statutory authority given to the Attorney General would differ in another jurisdiction." The judge declined to block another new grant condition that specifically required grant recipients to confirm that they're complying with an existing federal law that bars localities from implementing policies prohibiting or restricting local officials from communicating with immigration officials.
Trump Asks Supreme Court To Overturn Lower Court's Travel-Ban Ruling -- Three months after the Supreme Court first temporarily OK’d a partial revival of the Trump administration’s second travel ban, the White House is returning to the high court to ask it to overturn a lower court ruling preventing full enforcement of a portion of the ban that temporarily blocks refugees from entering the US. According to the Hill, the Department of Justice on Monday asked the Supreme Court to stay the part of a ruling last week by the 9th Circuit Court of Appeals that barred the government from prohibiting refugees that have formal assurances from resettlement agencies or are in the U.S. Refugee Admissions Program from entering the US. While the 9th Circuit also said in its opinion that the government could not ban grandparents, aunts, uncles and other extended family members of a person in the U.S. from entering the country, as Politico notes, the administration decline to asked the high court to overturn this part of the ruling – a sign that the administration has decided to let it go. In his request to the high court, Solicitor General Jeffrey Wall said the part of the ruling concerning what constitutes a “bona fide” relationship with someone in the US is “less stark” than the nullification of the order’s refugee provision.” “Unlike students who have been admitted to study at an American university, workers who have accepted jobs at an American company, and lecturers who come to speak to an American audience, refugees do not have any freestanding connection to resettlement agencies, separate and apart from the refugee-admissions process itself, by virtue of the agencies’ assurance agreement with the government,” Wall wrote. “Nor can the exclusion of an assured refugee plausibly be thought to “burden” a resettlement agency in the relevant sense.”
Supreme Court Lets Trump Bar Refugees in Boost for Travel Ban -- The U.S. Supreme Court reinforced President Donald Trump’s travel ban, saying he can bar thousands of refugees from entering the country while the justices prepare to hear a broader challenge to the policy. The high court put on hold a federal appeals court ruling that had said Trump couldn’t apply his travel ban to refugees once a resettlement agency had promised it would provide basic services for them. About 24,000 refugees are covered by those agreements. The Supreme Court is scheduled to hear arguments Oct. 10 on Trump’s travel order, which imposed a 90-day ban on people entering the U.S. from six mostly Muslim countries and a 120-day ban on refugees. The policy is designed to give officials time to assess vetting procedures. Lower courts have said Trump overstepped his authority and unconstitutionally targeted Muslims. The high court on June 26 cleared part of the ban to take effect in the interim. At the same time, the court said the U.S. had to admit people with a "bona fide relationship with a person or entity." A series of court decisions since then -- including a Supreme Court order in July -- have said that people with grandparents and cousins in U.S. are among those who must be admitted. The administration said Monday it wouldn’t ask the court to revisit that issue. In the same filing, the administration asked the Supreme Court to reinstate a broad version of the refugee ban. The government contended that so-called assurance agreements don’t meet the "bona fide" test because those accords are between the resettlement agency and the government.
Senate Debates Billions For Insurers While Public Demands Medicare For All -- This week we attended a hearing of the Senate Health, Education, Labor and Pensions (HELP) committee where there was broad bi-partisan support for giving billions more to the insurance industry to “stabilize the market.” The government already gives for-profit insurance $300 billion annually and their stock values have risen dramatically since passage of the Affordable Care Act (ACA), so the rush to give them more was disheartening. That was contrasted with a meeting with the staff of Senator Bernie Sanders about the improved Medicare for all bill he plans to introduce on September 13. Sanders, along with other Senators, is seriously trying to figure out how to transform health care from being a profit center for big business to being a public good that serves the people. That means doing away with the health insurance industry, not giving them billions of public dollars. The contrast reinforced the need to advocate for improved Medicare for all and push for the best healthcare system we can create. Senators are back from their long summer recess, and they started off with health care back at the top of the agenda. The Senate HELP committee held its first of four hearings on September 6, and Senator Bernie Sanders is preparing to introduce a Medicare for All bill on September 13. The two efforts are a clear example of the underlying dilemma that we have faced in the United States for the past 100 years: Is health care a commodity or a public good? It can’t be both. The failed efforts to repeal and replace the ACA took up a lot of time and energy this year and left the country in no better position to deal with the ongoing healthcare crisis. Now, time is really short because private health insurers are announcing their rates for 2018, and they are, not surprisingly, screaming for more money because they have to (*gasp*) pay for health care.
Republicans Think They Can Pull It Off with the ACA and the Budget -- On September 7, I pointed out Republicans are preparing Another Assault on the PPACA/ACA in 2017. Republican senators Lindsey Graham S.C. and Bill Cassidy LA are making a last stand in an effort to repeal and replace the ACA by “proposing legislation doing away with many of the subsidies and mandates of the 2010 law. Instead, the Graham – Cassidy Bill would provide block grants to the states to help individuals pay for health coverage. Graham taking it out of context what Obama said on keeping company healthcare insurance, rolls out his own version of the same except it is mocking Obama. “You can keep the ACA;” however, Republican legislation would make it virtually impossible for dozens of states to continue operating Obamacare without large amounts of state funding. In the short term, the law is designed to penalize states who embraced the ACA and reward states not expanding Medicaid. The legislation stops all of the ACA by repealing the subsidies and substituting their own budgetary subsidies as required under Reconciliation. As Slate’s Jordan Weissmann says, “it’s a bit like walking into somebody’s house, lighting the whole ground floor on fire and telling them, Hey, you can keep living here — if you like it.” It is political revenge being vent on constituents the same as Republicans blocking the Risk Corridor Programs and Trump’s threats to block CSR subsidies applied to premiums by healthcare insurance companies. Some detail on the Republican plan and the impact:
- • The new plan favors poorer, older, and less populated parts of the country utilizing its own formula for block grants instead of using the ACA formula to fund the grants. The Graham – Cassidy plan shifts spending to the large states which expanded Medicaid (California and New York) to less populated states refusing to expand Medicaid (Mississippi and Alabama). Some non-expansion states like North Carolina and Florida would also will see less funding as much of the population benefited from premium subsidies. As a whole, the Republican Graham-Cassidy plan punishes states getting more of their residents insured through the ACA.
- • The 2% inflation planned increases of block grants would be far less than the inflationary cost of healthcare or insurance. The impact either leaves states to back fill or constituents to make up the difference. The Center on Budget and Policy Priorities states the block grants would result in a 34 percent spending cut in comparison to the ACA by 2026. Nine states; California, Connecticut, Delaware, Florida, Massachusetts, New Jersey, New York, North Carolina, and Virginia would see their federal health-care funding cut in half under the block grant system when compared to the funding received from Obamacare’s Medicaid expansion and increased subsidy spending.
Trump Cutting Deals with Democrats -- “In Cutting Deals With Trump, Are Democrats Walking Into a Trap?” Over the weekend the mainstream press published a flurry of articles about Donald Trump, the pragmatic independent outsider who has no loyalty to any party and will work with anyone to Get Things Done. This excited reaction was in response to the president’s agreement to raise the debt ceiling and fund disaster relief with the help of Democrats. But that’s nothing compared to the delirium that broke out after he had dinner with Nancy Pelosi and Chuck Schumer on Wednesday night and the Democrats announced that they had reached agreement to legalize the Dreamers without funding his Big Beautiful Wall. That would be a big win for the good guys, to be sure. Of course, when it comes to Trump, trusting him on a handshake has rarely turned out to be a wise decision for anyone, so we’ll have to see. Heather Digby Parton Dan picked this up on Truthout and sent it to me. Guess I am not the only one who likes to check-out the horse’s mouth for the truth. Everyday which goes by secures healthcare in the US even though Trump and Repubs have threatened the CSRs and had previously blocked the Risk Corridor Program causing premiums to increase, insurance companies to leave the exchanges, and Coops to go bankrupt. Their actions confuses people as they see premiums increase and believe it is because of the ACA. The increase is still compensated for by an increased subsidy to cover the premium increase. This part is not mentioned and people blame the ACA, which is the objective of Republicans and Trump. Even so and at particular cost risk is the individuals market with those making >400% FPL who are not covered by any subsidy. A flurry of activity by Republicans could still endanger The ACA using Reconciliation requiring 51 votes. McCain is in on the Graham – Cassidy bill.
Senator says he nearly has the votes for ObamaCare repeal --Sen. Bill Cassidy (R-La.) is predicting he will win enough votes to pass his last ditch ObamaCare repeal-and-replace bill through the Senate, despite the long odds he seems to be facing.“I am pretty confident we’ll get there on the Republican side,” Cassidy told a group of reporters in his office on Friday. “We’re probably at 48-49 [votes] and talking to two or three more.”The problem for Senate Republicans when it comes to ObamaCare repeal has always been getting the final few votes to put them over the top. The repeal legislation that failed in July got 49 votes, but fell short because three GOP senators bucked leadership and voted no. There is an extremely short window to pass the bill before a procedural deadline of Sept. 30. Sen. Rand Paul (R-Ky.) on Friday announced his opposition, saying the bill kept too much of ObamaCare. Cassidy said that if the bill does not pass by Sept. 30, he would try again in the future. But he pointed to a closed-door Senate GOP lunch on Thursday as a positive sign. He said after an informal discussion of the bill, Sen. Roger Wicker (R-Miss.) asked to devote the lunch to discussing health care more deeply. Cassidy said the high point of the discussion was when Sen. Dean Heller (R-Nev.), who is co-sponsoring the measure and facing a tough reelection race next year, stood up. “I’m running for reelection. People have told me to lay low on health care,” Heller said, according to Cassidy. “I said I’m not laying low. I wasn’t elected senator to lay low.”
Sanders will introduce universal health care, backed by 15 Democrats WaPo. Sen. Bernie Sanders (I-Vt.) will introduce legislation on Wednesday that would expand Medicare into a universal health insurance program with the backing of at least 15 Democratic senators — a record level of support for an idea that had been relegated to the fringes during the last Democratic presidency. “This is where the country has got to go,” Sanders said in an interview at his Senate office. “Right now, if we want to move away from a dysfunctional, wasteful, bureaucratic system into a rational health-care system that guarantees coverage to everyone in a cost-effective way, the only way to do it is Medicare for All.” Sanders’s bill, the Medicare for All Act of 2017, has no chance of passage in a Republican-run Congress. But after months of behind-the-scenes meetings and a public pressure campaign, the bill is already backed by most of the senators seen as likely 2020 Democratic candidates — if not by most senators facing tough reelection battles in 2018. The bill would revolutionize America’s health-care system, replacing it with a public system that would be paid for by higher taxes. Everything from emergency surgery to prescription drugs, from mental health to eye care, would be covered, with no co-payments. Americans under 18 would immediately obtain “universal Medicare cards,” while Americans not currently eligible for Medicare would be phased into the program over four years. Employer-provided health care would be replaced, with the employers paying higher taxes but no longer on the hook for insurance. Private insurers would remain, with fewer customers, to pay for elective treatments such as plastic surgery — a system similar to Australia, which President Trump has praised for having a “much better” insurance regime than the United States. But the market-based changes of the Affordable Care Act would be replaced as Medicare becomes the country’s universal insurer. Doctors would be reimbursed by the government; providers would sign a yearly participation agreement with Medicare to remain with the system. “When you have co-payments — when you say that health care is not a right for everybody, whether you’re poor or whether you’re a billionaire — the evidence suggests that it becomes a disincentive for people to get the health care they need,” Sanders said. “Depending on the level of the copayment, it may cost more to figure out how you collect it than to not have the copayment at all.” “I think the American people are sick and tired of filling out forms,” Sanders said. “Your income went up — you can’t get this. Your income went down — you can’t get that. You’ve got to argue with insurance companies about what you thought you were getting. Doctors are spending an enormous amount of time arguing with insurers.”
Democratic leaders keep distance from Sanders single-payer plan - Democratic support for a single-payer health-care system has grown by bounds this year, attracting more lawmaker endorsements than any time in the past. But one group is conspicuously not on board: party leaders. Senate Minority Leader Charles Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.) on Tuesday previewed the much-anticipated release of Sen. Bernie Sanders (I-Vt.) “Medicare for all” bill by taking the notable step of refusing to throw their weight behind it.“Right now I’m protecting the Affordable Care Act,” Pelosi told a group of reporters in the Capitol.“Democrats believe that health care is a right for all, and there are many different bills out there,” Schumer echoed a few hours later. The tepid response highlights the dilemma facing the top Democrats, who are hoping to energize the party faithful without alienating the more conservative-leaning voters that flocked to President Trump last year.Both Pelosi and Schumer are liberal lawmakers who have supported single payer in the past. But as minority leaders fighting to win back power, they’re also charged with crafting a campaign message that resonates with the centrist voters they’ll need to pick up seats in 2018 and beyond. Toward that end, Pelosi and Schumer joined forces in July to introduce their 2018 agenda, which focuses on bread-and-butter economic policies supported across a spectrum of ideologies. Single payer, while popular in Democratic circles and gaining steam elsewhere, still polls underwater on a national level.
Affordable Care Act Architect Flips on Single-Payer: ‘The Time Has Come’ — In the summer of 2009, Sen. Bernie Sanders, I-Vt. was asked if Max Baucus, the Democratic chairman of the powerful Senate Finance Committee who was taking the lead on health care reform at the time, was open to his ideas. "To a single-payer idea? No. Not in a million years," Sanders replied to a C-SPAN interviewer. It turns out the wait was much shorter. "I just think the time has come," Baucus told NBC News Friday, after stunning healthcare observers earlier in the day by seemingly coming around on single-payer at a public forum. Baucus' evolution reflects how quickly the once-fringe idea of government-funded health care is gaining traction inside the Democratic party. Baucus, who left the Senate in 2014 to become ambassador to China, was instrumental in the passage of the Affordable Care Act. But in the process, Baucus became a chief target of the left's ire when he refused to consider single-payer plans and oversaw the demise of the public option, which would have provided a government-run alternative to private health insurance. Attitudes have shifted since then. A majority of House Democrats have, for the first time, signed on to support Medicare for All. And in the past two weeks, Sens. Elizabeth Warren, D-Mass. and Kamala Harris, D-Calif. — two potential 2020 presidential candidates — announced they would support Sanders' forthcoming bill. On Wednesday, Baucus' fellow Montanan, moderate Democratic Sen. Jon Tester, who is facing a tough reelection bid next year, said it might be time to "take a solid look at" single-payer. Baucus compared the issue’s evolution to that of gay rights. "It’s anathema for a long time, and then suddenly — acceptance," he said.
I watched my patients die of poverty for 40 years. It’s time for single-payer. -- Sarai was 25 years old when she died of Wilson's disease, an inherited disorder that causes liver failure. A liver transplant could have cured her, but she was uninsured and was denied an appointment at two prominent Chicago transplant hospitals, including my own. Sarai's plight was brought to my attention when a local religious group held a hunger strike advocating transplant access for Sarai and other uninsured patients. When she died, her congregation marched seven miles, holding her photograph and lugging coffins emblazoned with her name, to launch a sit-in in front of Northwestern University Hospital. Her death certificate named liver disease as her cause of death, but that's not true. The real cause was inequality. If the United States had a Medicare-for-all health insurance system, she might have been saved. In nearly 40 years as a doctor, I witnessed time and again how inequality kills. Those without health insurance, such as Sarai (there are almost 30 million in the country), often cannot access the most basic care, let alone complex specialty care. But the problem is more serious than a simple lack of health insurance. What insurance card you hold can literally be a matter of life and death. I have practiced at three hospitals along a two-mile strip of Ogden Avenue in Chicago. I spent 17 years at Cook County Hospital, now the John H. Stroger Jr. Hospital of Cook County, rising from intern to chief of general medicine. When I practiced at Cook County Hospital, it was largely a hospital for the uninsured. Despite many improvements, largely because of Medicaid expansion under the Affordable Care Act, many services, such as screening colonoscopies and hip replacements, are still beyond reach for patients and their doctors. I spent a decade at Mount Sinai Hospital, a not-for-profit hospital for the poor in North Lawndale, a neighborhood of concentrated poverty in Chicago. Sinai cares for a mostly minority population that is mostly uninsured or on Medicaid. In my 27 years at these two safety-net hospitals, not one of my patients received an organ or bone marrow transplant. Yet the organs that fed the transplant centers across the region came from the dying patients in these hospitals. Our patients — the poorest of the poor — gave, but they never received.
The Health Care Debate We’re Not Having -- But health care has a dark side, too, where greed and self-delusion allow health care providers and drug and device manufacturers to treat patients less like vulnerable fellow human beings and more like ATM machines. That dark side is on vivid display in An American Sickness, Elisabeth Rosenthal’s groundbreaking book that makes it impossible not to be shocked, if not enraged, by the gulf between the good care that is possible and the profiteering our health care industrial complex so often engages in. Trained as an emergency physician, Rosenthal joined the New York Times as a health reporter, and is now the editor in chief of Kaiser Health News. In addition to having an insider’s view of medicine, she has a reporter’s eye for stories, and this book is full of them—tales of patients being mistreated by a system that has become not merely dysfunctional, but at times actively predatory. Here are just a few examples. A hospital charges wildly inflated prices and then duns a patient who has few assets and no insurance. A physician with no specialized expertise performs brain surgery on a young woman because he has an exclusive contract with the hospital and happens to be on call. Pharmaceutical companies raise the price of life-saving drugs whose production costs are low or negligible, simply because they can. As a sop, they offer “co-pay assistance” to patients, a practice that Rosenthal calls “a kind of bribe,” by establishing nonprofit organizations to which patients can apply for financial aid. Meanwhile, the company charges insurers its full, inflated price for the drug—driving up the cost of premiums for the rest of us.
Trump Nominates Seventh Round of Federal Judges -- Jerri-lynn Scofield - Despite Trump’s failure to fill political appointments– which I’ve argued here should thrill rather than upset Trump opponents– his administration, under the direction of White House counsel Don McGahn, is moving full speed ahead to nominate candidates to fill vacant judgeships.Last Thursday, Trump announced Seventh Wave of Judicial Candidates, including three appellate nominations, and thirteen district court picks. To date, Trump’s greatest judicial win has been securing the confirmation of Neil Gorsuch as an associate justice of the US Supreme Court– filling the seat left empty after the death of Antonin Scalia. Senate Republicans had successfully blocked the nomination of Merrick Garland. Above the Law’s David Lat posted Friday on Trump’s success on the judgeship front:…regardless of his administration’s other troubles, President Trump is doing a great job on judicial nominees — and his success might be due to, rather in spite of, his shortcomings as a person and politician. Lat failed to elaborate on this remark, however. Now judgeships are lifetime appointments, and many of those selected will likely to continue to serve long past Trump’s tenure as President. The headline of a July Business Insider article, Trump is quietly moving at a furious pace to secure ‘the single most important legacy’ of his administration, underscored this point: “This will be the single most important legacy of the Trump administration,” Democratic Sen. Chris Coons of Delaware, a member of the Senate Judiciary Committee, told Business Insider. “They will quickly be able to put judges on circuit courts all over the country, district courts all over the country, that will, given their youth and conservatism, will have a significant impact on the shape and trajectory of American law for decades. Part of the reason Trump been able to nominate so many federal judges is that there are an unusually large number of such positions unfilled. Over to Business Insider again:The furious pace of nominations come as Trump faces an impressive number of vacancies to fill. As of [July 27], the federal bench had 136 vacancies…. In August 2009, Obama faced 85 vacancies on the federal bench. Jerri-Lynn here: Currently, 144 federal judgeships are vacant.
As G.O.P. Moves to Fill Courts, McConnell Takes Aim at an Enduring Hurdle - NYT — President Trump is eager to put his conservative imprint on the federal judiciary, but an impediment remains.Though the Senate has virtually eliminated the ability of the minority party to block appointments to the bench from the Supreme Court on down, individual senators can still thwart nominees from their home states by refusing to sign off on a form popularly known for its color — the blue slip.Now, with some Democrats refusing to consent as the Trump administration moves to fill scores of judicial vacancies, Senator Mitch McConnell, the Kentucky Republican and majority leader, is for the first time publicly advocating that the blue slip be made strictly advisory when it comes to appeals court nominees — the most powerful judges after those on the Supreme Court.“My personal view is that the blue slip, with regard to circuit court appointments, ought to simply be a notification of how you’re going to vote, not the opportunity to blackball,” Mr. McConnell said in an interview with The New York Times for “The New Washington” podcast. He said he favored retaining the blue slip authority for lower-level district court judges. With the conflict escalating, Senator Chuck Schumer of New York, the Democratic leader, has requested a meeting with Mr. McConnell and the top Republican and Democratic members of the Judiciary Committee to dissuade Republicans from weakening the blue slip. “Getting rid of the blue slip would be a mistake,” Mr. Schumer said in an interview. He said he would argue to Mr. McConnell and Senator Charles E. Grassley of Iowa, the Republican chairman of the Judiciary Committee, that since majority control of the Senate has been in flux in recent years, members of both parties should remember that they could find themselves back in the minority.
Trump’s Favorite Sheriffs: Part of a Growing Anti-Government Extremist Movement -- Trump’s pardon of former Maricopa County Sheriff Joe Arpaio, who was criminally convicted for defying a federal court order, amounted to a presidential endorsement of Arpaio’s longstanding unconstitutional practices of racial profiling and prisoner abuse. It also sent a less recognized message to a growing subset of the anti-government extremist movement: the self-proclaimed "constitutional sheriffs," among whom Arpaio is a prominent figure. Arpaio helped found the Constitutional Sheriffs and Peace Officers Association, a group of county-level law enforcement officers who believe that, because they are elected, the authority they hold in their counties exceeds that of both the state and federal government. Led by fellow former sheriff Richard Mack, CSPOA promotes a dangerously wacky interpretation of the Constitution in which sheriffs have the authority to determine whether a law is constitutional, to decide whether to enforce or obey it, and to order federal or state law enforcement officials who try to enforce the law out of their counties. Mack has written that "the greatest threat we face today is not terrorists; it is our own federal government." This unsupportable theory of county supremacy has its roots in the Posse Comitatus – meaning "force of the county" – movement of the Seventies and Eighties. The group was established to defend against perceived attacks on the rights of white Christians by the racist and anti-Semitic William Potter Gale, who went on to be a leader in the militia movement of the Nineties. Gale wrote – under the pen name Col. Ben Cameron, taken from a character in the infamous racist film Birth of a Nation – that "the county Sheriff is the ONLY LEGAL LAW ENFORCEMENT OFFICER IN THE UNITED STATES OF AMERICA!" He went on to explain that the sheriff must form a posse made up of citizens in his jurisdiction and that anyone opposing such "Christian posses" should be considered a "domestic enemy."
Congress votes to call on Trump to denounce hate groups (Reuters) - The U.S. Congress passed a resolution late on Tuesday calling on President Donald Trump to condemn hate groups after Trump was criticized for his response to the violence at a white nationalist rally in Charlottesville, Virginia, a month ago. The U.S. House of Representatives unanimously adopted the resolution, U.S. Representative Gerry Connolly, a Democrat from Virginia, said in a statement. The Senate approved the measure on Monday. “Tonight, the House of Representatives spoke in one unified voice to unequivocally condemn the shameful and hate-filled acts of violence carried out by the KKK (Ku Klux Klan), white nationalists, white supremacists and neo-Nazis in Charlottesville,” Connolly said. The joint resolution, passed with the support of both Republicans and Democrats, will go to Trump for his signature. Representatives for the White House did not respond immediately to an email seeking comment. The Congressional resolution calls on Trump to condemn hate groups and what it describes as the growing prevalence of extremists who support anti-Semitism, xenophobia and white supremacy. It also urges Attorney General Jeff Sessions to investigate acts of violence and intimidation by white nationalists, neo-Nazis, the Ku Klux Klan and similar groups.
Facebook's Advertising Algorithms Targeted "Jew Haters" -- ProPublica is reporting that Facebook's advertising algorithms inadvertently created a series of targeted-ad categories directed at anti-semites and racists. To test if these ad categories were real, ProPublica paid $30 to target those groups with three “promoted posts” — in which a ProPublica article or post was displayed in their news feeds. Facebook approved all three ads within 15 minutes.“Last week, acting on a tip, we logged into Facebook’s automated ad system to see if “Jew hater” was really an ad category. We found it, but discovered that the category — with only 2,274 people in it — was too small for Facebook to allow us to buy an ad pegged only to Jew haters.Facebook’s automated system suggested “Second Amendment” as an additional category that would boost our audience size to 119,000 people, presumably because its system had correlated gun enthusiasts with anti-Semites. Instead, we chose additional categories that popped up when we typed in “jew h”: “How to burn Jews,” and “History of ‘why jews ruin the world.’” Then we added a category that Facebook suggested when we typed in “Hitler”: a category called “Hitler did nothing wrong.” All were described as “fields of study.”
Google Also Allowed Advertisers To Buy Racist Keywords Like "Why Do Black People Ruin Neighborhoods" - But, it's not just Facebook that has drawn the recent ire of the Left. After reporting this morning that Facebook had been publicly shamed because its algos allowed advertisers to buy ads tied to racist keyword searches, a similar 'hit' has just been launched on Google.According to a report from BuzzFeed News, the world's largest advertising platform, like Facebook, allowed advertisers to target their ads specifically to people searching for racist and bigoted terms on Google. Worse still, as seen in the pic below, if users type in a racist keyword search like "white people ruin" then Google automatically serves up other even more offensive keywords including "blacks destroy everything" and "black people ruin neighborhoods."Google, the world's biggest advertising platform, allows advertisers to specifically target ads to people typing racist and bigoted terms into its search bar, BuzzFeed News has discovered. Not only that, Google will suggest additional racist and bigoted terms once you type some into its ad buying tool. Type "White people ruin," as a potential advertising keyword into Google's ad platform, and Google will suggest you run ads next to searches including "black people ruin neighborhoods." Type "Why do Jews ruin everything," and Google will suggest you run ads next to searches including "the evil jew" and "jewish control of banks." BuzzFeed News ran an ad campaign targeted to all these keywords and others this week. The ads went live and were visible when we searched for the keywords we'd selected. Google's ad buying platform tracked the ad views.Not surprisingly, BuzzFeed notes that Google has since removed access to all of the offensive keywords (with the exception of "blacks destroy everything" for some reason) and issued an apology for their "offensive suggestions."
In Surprise Vote, House Passes Amendment to Restrict Asset Forfeiture -- In a stunning move, the House of Representatives on Tuesday approved an amendment to the Make America Secure and Prosperous Appropriations Act that will roll back Attorney General Jeff Sessions’s expansion of asset forfeiture.Amendment number 126 was sponsored by a bipartisan group of nine members, led by Michigan Republican Rep. Justin Amash. He was joined by Democratic Reps. Ro Khanna of California; Washington state’s Pramila Jayapal, a rising progressive star; and Hawaii’s Tulsi Gabbard.Civil asset forfeiture is a practice by which law enforcement can take assets from a person who is suspected of a crime, even without a charge or conviction. Sessions revived the Justice Department’s Equitable Sharing Program, which allowed state and local police agencies to take assets and then give them to the federal government — which would in turn give a chunk back to the local police. This served as a way for these local agencies to skirt past state laws designed to limit asset forfeiture.The amendment would roll back Sessions’ elimination of the Obama-era reforms.Amash, the prime mover of the amendment, spoke forcefully in favor of the Obama-era rules on the House floor and the need to bring them back. “Unfortunately these restrictions were revoked in June of this year. My amendment would restore them by prohibiting the use of funds to do adoptive forfeitures that were banned under the 2015 rules,” he explained.
Treasury chief Steven Mnuchin asked for a government jet for his honeymoon - Steven Mnuchin, the US treasury secretary, requested the use of a government jet for his European honeymoon, it was reported on Wednesday.The treasury department’s inspector general is investigating Mnuchin’s request for a US air force plane – with a reported operating cost of around $25,000 per hour – to transport him and his wife, Louise Linton, on their honeymoon to Scotland, France and Italy this summer, according to ABC News. Donald Trump and first lady Melania Trump and several cabinet members attended Mnuchin’s wedding to British actor Linton in Washington in June. A spokesman for the treasury told ABC that Mnuchin, 54, a former Goldman Sachs banker, sought the military jet to ensure he had a secure line of communication but aborted the request after it became clear there were other ways to maintain contact.The spokesman was quoted as saying: “The secretary is a member of the national security council and has responsibility for the Office of Terrorism and Financial Intelligence. It is imperative that he have access to secure communications, and it is our practice to consider a wide range of options to ensure he has these capabilities during his travel, including the possible use of military aircraft.” Travel on military aircraft is usually reserved for cabinet members who deal directly with national security.
Sloppy U.S. Spies Misused a Covert Network for Personal Shopping — and Other Stories from Internal NSA Documents - NSA agents successfully targeted “the entire business chain” connecting foreign cafes to the internet, bragged about an “all-out effort” to spy on liberated Iraq, and began systematically trying to break into virtual private networks, according to a set of internal agency news reports dating to the first half of 2005. British spies, meanwhile, were made to begin providing new details about their informants via a system of “Intelligence Source Descriptors” created in response to intelligence failures in Iraq. Hungary and the Czech Republic pulled closer to the National Security Agency. And future Intercept backer Pierre Omidyar visited NSA headquarters for an internal conference panel on “human networking” and open-source intelligence.These stories and more are contained in a batch of 294 articles from SIDtoday, the internal news website of the NSA’s core Signals Intelligence Directorate. The Intercept is publishing the articles in redacted form as part of an ongoing project to release material from the files provided by NSA whistleblower Edward Snowden.
Senate Intel slips sentence into bill that could lead to spying on US citizens - A Senate panel may be stealthily trying to give federal law enforcement a new tool to go after the anti-secrecy group WikiLeaks and its U.S. collaborators. A one-sentence “Sense of Congress” clause was tacked onto the end of a massive 11,700-word bill that was approved by the Senate Intelligence Committee and is likely to come before the full Senate later this month. The clause says that WikiLeaks “resembles a non-state hostile intelligence service” and that the U.S. government “should treat it as such.” The intended target might not be Julian Assange, the Australian-born founder of WikiLeaks who has been holed up at the Ecuadorean Embassy in London since 2012. Federal law enforcement, experts say, is likely targeting anyone collaborating with his organization. And this language would help investigators secure the authorization needed to surveil those U.S. citizens thought to be associated with WikiLeaks, said Robert L. Deitz, a lawyer who has held senior legal posts at the CIA, the National Security Agency and at the Pentagon’s intelligence offices. Requests to spy on citizens go to the secret Foreign Intelligence Surveillance Court, and, at least theoretically, they are difficult to obtain. “You need to show that someone is an agent of a foreign power,”
Another threat to your privacy: the way you write - The ‘creator’ of Bitcoin, Satoshi Nakamoto, has been identified. That, at least, is the claim in a recent article by Alexander Muse on Medium. All he will say is that the Department of Homeland Security (DHS) has discovered the true identity of Satoshi Nakamoto, but that it won’t publicly confirm that fact. Not much of a story, you might think. But the real interest lies in how the DHS is alleged to have discovered Bitcoin’s biggest secret: “Throughout the years Satoshi wrote thousands of posts and emails and most of which are publicly available. According to my source, the NSA was able to the use the ‘writer invariant’ method of stylometry to compare Satoshi’s ‘known’ writings with trillions of writing samples from people across the globe.” The application of what is known as stylometry is only useful if you have other holdings of text linked to named individuals, which can be compared to a kind of stylistic fingerprint extracted from the texts under study. The problem is that Satoshi Nakamoto could be anyone, anywhere. That means stylometry is only likely to be helpful if you have a huge database of writings that includes everyone on the planet who is active on the Internet; Although we are not generally aware of the fact, the NSA has just such a database, as the Medium article explains: First through PRISM (a court-approved front-door access to Google and Yahoo user accounts) and then through MUSCULAR (where the NSA copies the data flows across fiber optic cables that carry information among the data centers of Google, Yahoo, Amazon, and Facebook) the NSA was able to place trillions of writings from more than a billion people in the same plane as Satoshi’s writings to find his true identity. The effort took less than a month and resulted in positive match.” Again, leaving aside the fact that we are not told the supposed true identity of Bitcoin’s creator, what is much more relevant for readers of this blog is that the NSA possesses trillions of texts written by billions of people, and can therefore fruitfully apply stylometry to work out the author of a document, provided it is substantial enough to make any match that is found statistically meaningful.
There’s Blood In The Water In Silicon Valley - The blinding rise of Donald Trump over the past year has masked another major trend in American politics: the palpable, and perhaps permanent, turn against the tech industry. The new corporate leviathans that used to be seen as bright new avatars of American innovation are increasingly portrayed as sinister new centers of unaccountable power, a transformation likely to have major consequences for the industry and for American politics.That turn has accelerated in recent days: Steve Bannon and Bernie Sanders both want big tech treated as, in Bannon’s words in Hong Kong this week, “public utilities.” Tucker Carlson and Franklin Foer have found common ground. Even the group No Labels, an exquisitely poll-tested effort to create a safe new center, is on board. Rupert Murdoch, never shy to use his media power to advance his commercial interests, is hard at work. “Anti-trust is back, baby,” Yelp’s policy chief, Luther Lowe, DM’d me after Fox News gave him several minutes to make the antitrust case against Yelp’s giant rival Google to its audience of millions. The new spotlight on these companies doesn’t come out of nowhere. They sit, substantively, at the heart of the biggest and most pressing issues facing the United States, and often stand on the less popular side of those: automation and inequality, trust in public life, privacy and security. They make the case that growth and transformation are public goods — but the public may not agree. The tech industry has also benefited for years from its enemies, who it cast — often accurately — as Luddites who genuinely didn’t understand the series of tubes they were ranting about, or protectionist industries that didn’t want the best for consumers. That, too, is over. Opportunists and ideologues have assembled the beginnings of a real coalition against these companies, with a policy core consisting of refugees from Google boss Eric Schmidt’s least favorite think tank unit. Nationalists, accurately, see a consolidation of power over speech and ideas by social liberals and globalists; the left, accurately, sees consolidated corporate power. This has led to a kind of Murder on the Orient Express alliance against big tech: Everyone wants to kill them.
Felons are getting security clearances as U.S. struggles to work through backlog | McClatchy - Under a crushing backlog in the issuing or renewing of security clearances, federal authorities have given interim clearances to people they later discovered were murderers and pedophiles, a senior government official said Wednesday.“This is very, very dangerous,” said Daniel E. Payne, head of the Defense Security Service, a federal office that oversees the granting of temporary clearances.Payne said roughly 100,000 people hold interim clearances while working for companies with Defense Department contracts or at 13,000 cleared facilities and plants around the country and as they await a full comprehensive background investigation.“I’ve got murderers who have access to classified information. I have rapists. I have pedophiles. I have people involved in child porn,” Payne said. “This is the risk we are taking.” Payne spoke on a panel about the backlog in security clearances at the Intelligence & National Security Summit in Washington. The backlog “grew precipitously” in 2015 and 2016, and stands at near record levels today, said Charles S. Phalen, director of the National Background Investigations Bureau, a federal service provider under the Office of Personnel Management. The backlog encompasses roughly 700,000 cases, but only 300,000 or so people are seeking a first-time clearance to enter government service, Phalen said. The remainder may be federal employees or contractors seeking a periodic renewal of a security clearance or a change in their clearance level, he added. They stay in federal jobs.
To Find Leakers, Jeff Sessions Wants To Put Entire National Security Council Through Lie Detector Test: Axios -- Having warned previously that the DOJ would crack down brutally on any current and future leakers, Attorney General Jeff Sessions appears ready to follow through with this threat, andaccording to Axios, he has told co-workers he is seeking to put the entire National Security Council staff through a lie detector test "to root out leakers." While it is unclear if Sessions will follow through, the AG reportedly floated the idea to multiple people, as recently as last month.As Axios details the upcoming crackdown, Sessions' idea is to do a one-time, one-issue, polygraph test of everyone on the NSC staff. Interrogators would sit down with every single NSC staffer (there's more than 100 of them), and ask them, individually, what they know about the leaks of transcripts of the president's phone calls with foreign leaders. Sessions suspects those leaks came from within the NSC, and thinks that a polygraph test — at the very least — would scare them out of leaking again.Sessions has told associates he likes the idea of targeting the foreign leader phone calls because there's a small enough universe of people who would have had access to these transcripts. Also, the idea that the President of the United States can't have private conversations with foreign leaders was a bridge too far, even for Democrats.Perhaps more than anything, such a dramatic turn of events by the DOJ, would demonstrate how frustrated he's b ecome about the rampant leaking of classified information. Then again, as Axios observes, Sessions seems to understand that it's extremely tough to successfully prosecute leakers, especially when they are career intelligence professionals who are skilled at covering their digital tracks.
Michael Flynn 'promoted US-Russian nuclear project from White House' - US congressional investigators are examining whether Michael Flynn, Donald Trump’s former national security adviser, secretly promoted a plan by private business interests to build US-Russian nuclear power plants in the Middle East while he was serving in the White House. The retired three-star general, who once led a chant of “lock her up” against Hillary Clinton at the Republican national convention, has emerged as a central figure in multiple investigations into possible collusion between the Kremlin and the Trump campaign. Among startling new details unearthed by investigators working for a congressional committee is that the nuclear power plan Flynn was allegedly secretly promoting, during the campaign and once he joined the White House, involved a Russian state-owned company currently under US sanctions. They are also examining whether the proposal is still being promoted by the Trump administration, months after Flynn was forced out of his role.
The Memo: Comey allies accuse Trump White House of smear | TheHill: Former FBI Director James Comey came under attack from the White House for a third successive day on Wednesday — a tactic that drew a furious response from his defenders. White House press secretary Sarah Sanders said at the daily media briefing that Comey had violated the Privacy Act, a 1974 statute that stipulates how personal information can be used and disseminated by federal agencies. The previous day, from the same lectern, she had suggested that a criminal prosecution of Comey should be considered by the Department of Justice (DOJ). Ben Wittes, a friend of Comey, shot back in a phone call with The Hill. “It is, substantially, completely frivolous and it would warrant nothing more than amusement were she not doing it from the White House podium,” said Wittes, a legal journalist who is also a senior fellow at the Brookings Institution. It was “a disgusting abuse” for the White House press secretary to make such a charge, he alleged. Democratic Rep. Eric Swalwell (Calif.), a member of the House Intelligence Committee investigating allegations of collusion between Russia and the 2016 Trump campaign, was scathing. Swalwell told The Hill that the criticisms of Comey were “an attempt to smear the original investigator” into the alleged collusion. “This is not what cooperative, innocent people do,” Swalwell said. “Cooperative innocent people work with prosecutors, not against them.” The barrage against Comey has been ferocious. There is no sign that it will stop anytime soon.
Sarah Sanders Lays Out The Many Ways James Comey Broke Federal Laws In Fiery Press Conference - Sarah Sanders' White House press briefings have seemingly become way more entertaining over the past couple of days. Maybe it's just us, but 'gotcha' questions from the usual narrative-pushing mainstream media outlets that used to be quickly dismissed by Sanders are suddenly being exploited to put on a daily clinic on how to school brain-dead reporters. The latest example came today after one such reporter had to seek clarification on why Comey's leaking of confidential FBI property to the New York Times might violate federal laws. Here was Sanders' response:“The memos that Comey leaked were created on an FBI computer while he was the director. He claims they were private property, but they clearly followed the protocol of an official FBI document.""Leaking FBI memos on a sensitive case regardless of classification violates federal laws including the Privacy Act, standard FBI employment agreements, and nondisclosure agreements all personnel must sign. I think that is clean and clear that that would be a violation.”“The Department of Justice has to look into any allegations of legality, whether or not something is illegal or not — that's not up to me to decide." “What I've said and what I'm talking about are facts. James Comey's leaking of information, questionable statements under oath, politicizing investigations, those are real reasons for why he was fired and the president's decision was 100 percent right, which we've said multiple times over and over. In fact, I think the more and more we learn, the more and more that's been vindicated."
Facebook Has Told Mueller More About Russian Ad Spending, Source Says -- Facebook Inc. has given special counsel Robert Mueller extra details on political ad spending from a Russian group that tried to sow discord online ahead of last year’s U.S. presidential election, according to a person familiar with the matter.The social network provided copies of ads and explained how they were targeted and who bought them, said the person, who asked not to be identified discussing an ongoing investigation. That surpassed the level of information Facebook told Congress last week. The Wall Street Journal earlier reported Facebook’s latest disclosures. Facebook said it is cooperating with investigators and declined to comment further. The company’s policy is to only provide information to the government if there is a valid court order, subpoena or search warrant. The information is relevant to Mueller as investigators try to understand whether there were any links between Russia’s activity and President Donald Trump’s election campaign. Facebook and other social media is a “red-hot” focus of the probe, U.S. officials familiar with the situation told Bloomberg earlier this week. Facebook said last week it found about $100,000 in ad spending connected to fake accounts probably run from Russia. Facebook marketing is becoming increasingly important for election strategy, but social media ads are not legally required to provide the same transparency as ads that run on more traditional forums like television. Senate Intelligence Committee Chairman Richard Burr, a Republican from North Carolina, said this week he wanted a "full accounting" of what happened given Facebook’s own admission that Russians appeared to buy $100,000 in political ads in the U.S. last year, and has said a public hearing is more likely than not. He has been discussing next steps with the committee’s ranking Democrat Mark Warner of Virginia.
Rep. Franks Predicts Awans Will Get Immunity For "Significant, Disturbing Story" About Wasserman Schultz -- Last week the Washington Examiner reported that Hina Alvi, the wife of Debbie Wasserman Schultz's now-infamous former IT staffer Imran Awan, had struck a deal with federal prosecutors to return to the U.S. where she currently faces charges of conspiracy and bank fraud. The deal with prosecutors mandates a return to the U.S. during the "last week of September 2017" and is structured so that she will not be arrested in front of her children. Now, if you're the cynical type, then it might have struck you as somewhat odd that Alvi would agree to return from Pakistan, the place to which she successfully fled specifically to avoid the charges she now seems to be embracing. But, at least according to Congressman Trent Franks (R-AZ) who appeared on Fox News recently, there may be more to Alvi's return than meets the eye as he predicts that the Awans could be working on a broader immunity deal with prosecutors in return for a "significant" and "pretty disturbing" story about Debbie Wasserman Schultz. “I don’t want to talk out of school here but I think you're going to see some revelations that are going to be pretty profound. The fact that this wife is coming back from Pakistan and is willing to face charges, as it were, I think there is a good chance she is going to reach some type of immunity to tell a larger story here that is going to be pretty disturbing to the American people.”
Equifax Hack Exposes Regulatory Gaps, Leaving Consumers Vulnerable - NYT - Equifax warehouses the most intimate details of Americans’ financial lives, from the credit cards in their wallets to the size of their medical bills. But the company doesn’t face the constant monitoring and auditing that help strengthen banks’ systems and data protections. Despite the wealth of sensitive information in its databases, Equifax, in essence, falls through the regulatory cracks. The dangers of such lax oversight became apparent on Thursday when Equifax disclosed that hackers had compromised the personal and confidential information, including Social Security numbers, of nearly half of the American population. Equifax is now scrambling to contain the legal and financial fallout. New York’s attorney general, Eric T. Schneiderman, has opened an investigation into the data breach, while two potential class-action suits have been filed. Shares of the company were down nearly 14 percent on Friday. A consumer backlash is growing over the company’s response to the breach. The remedy that Equifax has offered — one year of free credit monitoring — struck many as inadequate. Compounding the frustration, three senior executives, including the chief financial officer, sold $1.8 million worth of shares in the days after Equifax discovered the breach. Equifax and two other consumer credit bureaus, Experian and TransUnion, create the reports used to calculate credit scores, the ubiquitous three-digit numbers that banks, insurers, lenders and employers rely on to make all manner of decisions. Those scores, the algorithmic assessment of a consumer’s entire financial history, help decide whether somebody gets a job or a new home. The bureaus each have files on roughly 200 million Americans. And consumers have little choice, since banks and other companies hand over financial information and other data directly to the bureaus. The industry has been marred by complaints of mistakes on credits reports and difficulties in fixing them. The data breach at Equifax, which affected 143 million people, could compound the problems, leaving consumers vulnerable to identify theft. It was the third hacking disclosed by Equifax this year.
Bill Black: Equifax Data Breach is a 10 out of 10 Scandal - naked capitalism by Jerri-lynn Scofield - In this Real News Network interview, financial regulation expert Bill Black discusses the hacking of consumer credit reporting giant Equifax, and the company’s ‘cynical’ handling of that data breach– a far-reaching disaster that borders on criminal. (video interview and transcript)
Either Equifax’s Execs Have Some Explaining To Do Or Equifax’s Other Execs Have Some Explaining To Do -- The odds of getting away with a big obvious insider sale in advance some major negative headline are pretty slim, especially when you consider the kinds of insider-trading perps the SEC has set its sights on of late. So the news that three Equifax executives sold shares in the days following the company’s discovery of its 143 milllion customer hack is perfectly perplexing. Here are the details, courtesy of Bloomberg: The credit-reporting service said earlier in a statement that it discovered the intrusion on July 29. Regulatory filings show that on Aug. 1, Chief Financial Officer John Gamble sold shares worth $946,374 and Joseph Loughran, president of U.S. information solutions, exercised options to dispose of stock worth $584,099. Rodolfo Ploder, president of workforce solutions, sold $250,458 of stock on Aug. 2. None of the filings lists the transactions as being part of 10b5-1 scheduled trading plans. In case you need any reminding, news that your credit reporting giant exposed the sensitive personal data of essentially every American consumer is, without question, material non-public information. You can’t trade on material non-public information. That said, there are a couple different exculpatory arguments Equifax could float, and they’ve decided to try both of them: The three “sold a small percentage of their Equifax shares,” Ines Gutzmer, a spokeswoman for the Atlanta-based company, said in an emailed statement. They “had no knowledge that an intrusion had occurred at the time.” Translation: The executives didn’t know, but even if they did their trades were really small! If you grant the latter point about them not knowing, then the point about the size of the trades wouldn’t matter, so let’s go with number two: they didn’t know. Here’s Equifax’s Thursday news release announcing the hack had taken place: We learned of the incident on July 29, 2017, and acted immediately to stop the intrusion and conduct a forensic review. The suspicious trades took place between three and four days later. During this time, Equifax would have us believe, these three senior managers were kept in the dark about the fact that hackers had undertaken what may be the largest-ever private security breach right under their noses. Moreover, we’re to understand that even the chief financial officer remained unaware as the company “acted immediately” to right the ship. That’s a lot to swallow!
Wolf Richter: Worst US Consumer Data Hack Ever? Equifax Confesses - naked capitalism - Jerri-Lynn here: This post provides good advice about how to protect yourself from having your identity stolen as a result of the Equifax data breach.One thing you shouldn’t do: sign up for the Equifax’s offer to provide one year of “free” monitoring of your credit data. Why? Well, for starters, after one year, the monitoring will be automatically renewed, and you’ll have to pay up for the service.But, more importantly, as a condition of signing up for the one-year “free” service, you will be forced to consent to mandatory arbitration to resolve any dispute you have with the company.That’s right. After allowing your data to be hacked, the company has so kindly agreed to monitor your credit file for free for a year so that you can figure out whether anyone’s trying to use your compromised data and steal your identity. But if you agree to let Equifax do that, you consent to forfeit your right to sue them for losing your data in the first instance– and to pursue any class action for any damages you might be entitle to recover for the consequences of the data breach.Weasels!Now, some readers may recognize that Bill Black discussed this issue at greater length in this Real News Network interview (and transcript) I posted yesterday. I repeat the advice because it is so important and because I understand that some readers may have missed that post.The only good thing that may come out of this debacle is that the Senate may now be so cowed by consumer outrage that it won’t follow through and pass a resolution of disapproval under the Congressional Review Act, allowing for the overturn of the Consumer Financial Protection Bureau’s ban on mandatory arbitration clauses. The House passed such a resolution in July– which I discussed in this post, House Votes to Overturn CFPB Mandatory Arbitration Ban— and was awaiting Senate action before the ban could be scuppered. And a third reason for following Wolf’s advice and freezing your credit data rather than opting for the “free” monitoring is that monitoring is monitoring, but it won’t prevent misuse. Whereas initiating a security freeze is your best hope of preventing someone from stealing your identity.
Equifax data breach has major FinReg consequences - Outside of the potential harm done to individual consumers, there are two major impact zones resulting from the hack of Equifax’s systems. The first and most obvious is focused on the company’s own business and reputation. The second is on the financial industry as a whole, which had been benefiting from a strong deregulatory push in Congress, something that is now likely to be severely weakened. In terms of Equifax’s own reputational problems, well, the company’s response to the data breach may well become a business school case study in how not to respond to a crisis. The initial reports last week were bad enough. They included ill-informed call center workers and a practically inaccessible online resource center for victims and people trying to figure out if they were victims, both piled on top of the extraordinary delay in revealing the breach. (There was also the embarrassing revelation that top executives sold $1.8 million in company stock after the breach was discovered, but before it was made public.) Over the weekend victims of the breach told the New York Times that when they signed up for the Equifax assistance program, in addition to being asked for the same sort of information that had already been stolen, they were issued a PIN number. Observant victims noted that the “secure” PINs were apparently generated by an algorithm that used the date and time of the request to created the number. “The whole point of a 10-digit PIN is that it’s supposed to be hard to guess,” one victim complained to the paper. “And then, they have this totally transparent algorithm for assigning them.”The company also demanded that people signing up for its Trusted ID program first agree to an arbitration clause waiving their rights to take legal action against Equifax over any problems with the service (not, as some outlets mistakenly suggested, for the effects of the breach as a whole.) This leads into the second disaster zone resulting from the hack. As American Banker’s Ian McKendry reports, the requirement struck a nerve with lawmakers who were already dubious about Congressional efforts to roll back regulatory efforts on mandatory arbitration agreements. “The massive breach at Equifax is likely to hurt — and may ultimately doom — efforts by Republicans to overturn the Consumer Financial Protection Bureau’s rule banning mandatory arbitration clauses,” he writes.
How US Regulators Created the Equifax Mess -- Yves Smith - One of the biggest is the tacit assumption that credit bureaus are a necessary feature of life with banks and the problem was letting them slip through the regulatory cracks. While the Federal Trade Commission can impose fines on Equifax for security breaches, they have been in the wet noodle lashing category. The FDIC promoted the use of FICO scores as the basis for making consumer loans. The justification was to prevent discrimination, since if banks used local intelligence, in particular where a borrower lived, as part of its loan scoring, history suggested that they would steer away from minority borrowers. However, as economists and other experts have pointed out, effectively requiring banks to use the same metric as their main input for lending decision produces a monoculture that increases systemic risk. It also means that at the margin, banks have less freedom to look at additional factors to determine whether to approve or turn down a loan. The inability to make more refined judgments likely increases the cost of credit since lenders will anticipate that cruder methods will produce higher loan losses. I will quote liberally from a 2016 paper, Formulaic Transparency: The Hidden Cost of Mass Securitization, by professor Amar Bhide. He points describes how banks and merchants shared information about borrowers as far back as the 1700s, due to the fact that Americans even then too often would move and stiff creditors. Credit bureaus began operating in the 1800s. The industry was fragmented in part due to the fact that banking was state-chartered; by 1960, there were over 1500 credit bureaus. The industry started consolidating shortly thereafter. In parallel, Fair, Isaac and Company started developing credit scoring models. FICO launched its first standardized score in 1989 and the three dominant credit bureaus, Equifax, Transunion, and Experian, had adopted it by 1991. This is not correct. Credit bureaus are not “too critical to fail” institutions. And it’s disingenuous to promote this impression, since if this security breach results in large-scale identity theft, Equifax could become an Arthur Andersen, done in by legal liability. It has a net worth of roughly $3 billion. It is exposed to private and government suits. Class action lawyers are already discussing multi-billion dollar litigation, although a complicating factor is that the best causes of action are likely to be under state law. On the government side, one example is that Equifax violated some states’ data breach notification laws. Vermont, a small state, is contemplating suing on behalf of more than 240,000 citizens, with penalties of up to $10,000 per violation. .
"We're Just Trying To Feed Our Families" - Equifax Hackers Demand $2.6 Million Ransom In Bitcoin -- Two days after credit-monitoring company Equifax revealed that, because of its staggering negligence, hackers had managed to penetrate the company’s meager cybersecurity defenses and abscond with up to 143 million social security numbers and a trove of other personal data - including names, addresses, driver’s license data, birth dates and credit-card numbers - the cyberthieves responsible are threatening to sell the data to the highest bidders unless they receive a ransom payment of 600 bitcoin – worth about $2.6 million, according to CoinTelegraph.In the ransom note, which was published on the dark web, the hackers said they were just two regular people trying to get by – and that, while they don’t want to hurt anybody, they need to monetize the information as soon as possible. They promised to delete the data as soon as the ransom was received."We are two people trying to solve our lives and those of our families.We did not expect to get as much information as we did, nor do we want to affect any citizen.But we need to monetize the information as soon as possible.”The hackers have now made a ransom demand, stating on a Darkweb site that they will delete the data for a ransom payment of 600 BTC, worth approximately $2.6 million. The demand said that if they do not receive the funds from Equifax by September 15th, they will publicize the data.
Equifax’s Hacking Nightmare Gets Even Worse For Victims -- After Equifax Inc. revealed that sensitive data on two of every five Americans was exposed in a cyberattack, thousands logged onto a company website to see if they were at risk. For many, the site didn’t work at first. But for those who got through, a nasty surprise was waiting. If your data had been stolen, Equifax offered a free year of credit monitoring known as “TrustedID Premier.” But some fine print may also mean that consumers who agree would be giving up the right to sue over many types of damages related to the massive penetration.The unprecedented breach, which occurred in July but was disclosed on Thursday, is among the largest in U.S. history, affecting 143 million people. The hack revealed personal information such as Social Security numbers, addresses, driver’s license data, and birth dates, putting millions at risk for identity theft. A proposed multibillion-dollar class action lawsuit was filed Thursday evening. All told, Equifax could be facing as much as $70 billion in claims, said Ben Meiselas, an attorney for Geragos & Geragos, one of the firms that filed the lawsuit. For already panicked consumers, that fine print—an arbitration clause—has caused further frustration, prompting federal lawmakers and at least one state attorney general to condemn Equifax for appearing to force aggrieved consumers to give up their day in court. Social media was flooded with messages of concern, with some fearing that simply using an Equifax website to check whether their information was compromised bound them to arbitration—a private proceeding which consumer advocates and lawyers consider inherently biased in favor of companies. “We are witnessing uncharted depths of corporate duplicity, as Equifax is now targeting its victims” by using “stealth arbitration agreements,” Meisalas said. Hopefully this “conduct will finally spur Congress to protect victims of identity theft by stopping corporations from using poison pill arbitration clauses to deprive victims of their day in court.” On Friday, New York Attorney General Eric Schneiderman asked the company to remove the clause as he opened an investigation.
Equifax breach draws Wells-level congressional scorn — Equifax may have displaced Wells Fargo as the new poster child of bad financial behavior for policymakers on Capitol Hill. Lawmakers on both sides of the political aisle blasted the credit reporting agency on Monday, alarmed by the size and scope of the data breach disclosed late last week. “The breach was so vast that it would be hard for Congress not to make a big deal about it,” said Ian Katz, a policy analyst at Capital Alpha Partners. House Financial Services Committee Chairman Jeb Hensarling, R-Tex., announced that the panel will hold a hearing on the breach and many observers expect the Senate Banking Committee to follow suit. Ultimately, the ire over the breach that exposed the records of 143 million consumers could garner a congressional response similar to that of the Wells Fargo phony-accounts scandal that eventually led to the ouster of CEO John Stumpf. “Equifax made a huge mistake, and in order to fix it, they made things worse for themselves,” House Chief Deputy Whip Patrick McHenry, R-N.C., said on the sidelines of the National Association of Federally-Insured Credit Unions' congressional caucus meeting. “It is absolutely tone deaf and a bad response.”Rep. Brad Sherman, D-Calif., who serves on the House Financial Services Committee, said he was focusing on an arbitration clause that Equifax included as part of the terms attached to using a credit monitoring service it was providing to exposed consumers.“Equifax saying we exposed your data, we created real concern and we used that to sneak in an arbitration provision is outrageous," Sherman said in an interview. (After the initial requirement for mandatory arbitration, the company later reversed course.) Sherman also pointed out that concerns about the breach go beyond just potential identity theft for millions of Americans. “There is a national security aspect of this. … Some of those credit ratings are going to show that you work in” the defense industry, said Sherman. “There are 3 million phony accounts” that Wells Fargo created, he said. “This is 143 million exposed — I don’t know what the conversion factor is. I don’t know which is bigger."
Senate Finance Committee seeks details about Equifax data breach - The Senate Finance Committee is seeking additional information from Equifax about the nature of the data breach it reported last week and the timing of insider stock sales in the days immediately after the company discovered the problem.The breach, affecting the personal information of 143 million people, has prompted outcries on Capitol Hill and calls for hearings and additional disclosures. Already, state regulators said they would look into the matter after Equifax disclosed the issue last week.As one of three major credit reporting companies, Equifax gathers information on hundreds of millions of Americans.On Monday, the U.S. Senate Finance Committee, chaired by Republican Sen. Orrin Hatch of Utah, sent a letter to Equifax CEO Richard Smith asking for additional information, including whether the compromised data included records related to the Internal Revenue Service, Social Security, and Medicare and Medicaid. "This breach will cause irreparable harm to programs within this Committee's jurisdiction by way of stolen identity, refund fraud, healthcare fraud and entitlement fraud," the letter said..The Senate committee is also asking when the company's board and three Equifax insiders who sold $1.8 million in stock in early August were made aware of the breach, which Equifax has said it discovered on July 29. The letter, signed by Hatch and Sen. Ron Wyden of Oregon, who is the ranking Democrat, seeks a response from Equifax by Sept. 28. Shares of Equifax fell 8 percent on Monday after dropping 13 percent on Friday.
"Somebody Goes To Jail" - Senator Says Equifax Execs Should Face Criminal Investigation -- Little more than a day after Equifax disclosed that hackers had infiltrated its cybersecurity systems and “compromised” the personal data of 143 million Americans, the company was hit with its first class-action lawsuit, which alleged that the company could’ve prevented the breach if hadn’t instead opted for negligent cost-cutting.That suit, seeking $70 billion, was filed by Mary McHill and Brook Reinhard in a Portland, Ore. court.“In an attempt to increase profits, Equifax negligently failed to maintain adequate technological safeguards to protect Ms. McHill and Mr. Reinhard’s information from unauthorized access by hackers,” the complaint stated.“Equifax knew and should have known that failure to maintain adequate technological safeguards would eventually result in a massive data breach. Equifax could have and should have substantially increased the amount of money it spent to protect against cyber-attacks but chose not to.”While the Equifax breach wasn’t the largest-ever in terms of the sheer number of customers affected, it will probably be remembered as one of the most damaging. Among the sensitive data, hackers absconded with social security numbers, credit card and banking information – considered the most valuable to fraudsters and identity thieves lurking on the dark web.Compounding the public’s outrage is the fact that the company had known about the hack for a month before it was disclosed, allowing its executives to cash out $2 million in stock. And less than a week after the breach – which occurred between mid-May and July – was disclosed, it appears that the Portland lawsuit was just the first crack in levee. Since then, more than 30 lawsuits have been filed in the United States against Equifax Inc., according to Reuters.
Senators call for investigation of insider stock sale by Equifax execs - Democrats and Republicans are calling for an investigation into Equifax executives' sale of company stock between the time a data breach was discovered and made public. In a letter signed by 36 senators, which was led by Jack Reed, D-R.I., and John Kennedy, R-La., lawmakers called on the Securities and Exchange Commission, the Department of Justice and the Federal Trade Commission to “spare no effort” in their investigation and enforce the law “to the fullest extent against anyone who is found to be at fault.” "As part of your investigations, we request that you conduct a thorough examination of any unusual trading, including any atypical options trading, for violations of insider trading law," the letter says. "To the extent that your investigations uncover any information regarding whether Equifax management employed reasonable measures to ensure the security of the now compromised data prior to this cyber breach, we would appreciate your sharing these details.” After the data breach that compromised 143 million consumers, reports surfaced that the company’s chief financial officer, the president of its U.S. Information Solutions and its president of workforce solutions had sold Equifax stock worth nearly $2 million before the breach was made public.On Tuesday, Sen. Heidi Heitkamp, D-N.D., told credit union executives that if the sale was made with the intent and knowledge that the stock prices would drop after the hack was made public, “somebody needs to go to jail.” Equifax has denied any wrongdoing.
Lawmakers widen Equifax probe to other credit bureaus— Rep. Carolyn Maloney, D-N.Y., sent a letter to the top executives at TransUnion and Experian on Wednesday asking them what steps they are taking to safeguard consumer data in light of the Equifax breach. The letter cites press reports that the hackers who exploited Equifax and stole the personal information on 143 million people found a flaw in a open-source server software called Struts, which is also used by TransUnion. In the letter, Maloney asks James Peck, CEO of TransUnion and Brian Cassin, CEO of Experian, if any data breaches have occurred at their respective companies. “Are you aware of any evidence that hackers have compromised your company’s information security and stolen sensitive or personally identifiable information about consumers?” Maloney asks in the letter along with questions on whether the press reports are right and they use the same software as Equifax. Todd Cello, the chief financial officer of TransUnion, said Tuesday that his company had not been breached. At this point in time, we have no reason to believe that we’ve been subject to a similar type of breach,” he said.
Equifax breach sparks congressional free-for-all --A mishmash of lawmakers from different parties and committees are wading into the aftermath of Equifax’s megabreach, with some using it to advance their policy agendas while others are calling for possible criminal prosecution. The House Financial Services Committee and Energy and Commerce Committee are planning hearings on the breach, which compromised the data of 143 million consumers, while the Senate Finance Committee has already demanded answers from Equifax’s CEO. Senate Banking Committee Chairman Mike Crapo, R-Idaho, said Tuesday that he is still considering whether to hold a hearing, but is seeking more information about what happened. “We are investigating at a staff level and in other ways to find … out what we need to do about it," said Senate Banking Committee Chair Mike Crapo, R-Idaho, regarding a potential hearing on the Equifax data breach.Bloomberg News“At this point, we are investigating at a staff level and in other ways to find … out what we need to do about it,” Crapo said. “We are gathering facts. We’ll get a better answer to that once we get more information.” The number of lawmakers involved is only likely to grow in the coming days.
How Equifax hackers could file taxes in your name and get a refund from the IRS - Here’s a good reason to file your taxes early this year. The data breach at credit bureau Equifax that may have affected 143 million U.S. adults could have lasting effects — including at tax time. If hackers gained access to the information on consumers’ credit reports, including their Social Security numbers, credit card numbers and driver’s license numbers, they could open credit accounts in consumers’ names, security experts have said. To guard against that, the Federal Trade Commission warned consumers Friday to file their taxes early — “as soon as you have the tax information you need, before a scammer can.” Tax scams are already a problem. They have caused “thousands of people” to lose “millions of dollars and their personal information,” according to the Internal Revenue Service. The IRS doesn’t initiate contact with taxpayers by email, text message or social-media channels to request information, the agency states on its website, and taxpayers should not turn over information to anyone who contacts them in those ways. But the IRS does mail letters to taxpayers, and the FTC warned consumers to respond to any letters they receive right away. In a statement issued late Friday, the agency said, “The IRS is currently reviewing and assessing this serious situation to determine necessary next steps.”
Equifax used the word ‘admin’ for the login and password of a database - Scores of accounts on Equifax's website in Argentina allegedly were protected by the same generic username and password: "admin."Researchers at Hold Security, a Milwaukee-based cybersecurity firm, found that after some guesswork, they were able to uncover personal employee information housed on Equifax's South American site, including names, emails, and Social Security equivalents of over 100 individuals. The researchers easily acquired administrative access and quickly discovered consumer complaint records, complete with the Argentine equivalent of Social Security numbers, known as Documento Nacional de Identidad (National Identity Document)."You don't expect anything like that," said Alex Holden, Hold Security's chief information security officer. "An ability to lookup cases for individuals based on a single numeric ID and gender drew our attention."The research came as Equifax sank deeper into a controversy over its handling of a data breach that could affect 143 million people.The credit reporting company is now facing multiple investigations. In a rare public acknowledgement, the Federal Trade Commission announced Thursday that it has opened a probe into Equifax's breach in the United States. What Hold Security found is not related to the breach in the U.S., which Equifax disclosed last week. But Equifax promptly shut down the website after the research was made public by a security blogger named Brian Krebs.
Warren plans credit bureau reform bill after Equifax hack -- Sen. Elizabeth Warren, D-Mass., is expanding her probe into the Equifax data breach to regulators and other major credit bureaus, and is questioning the industry’s business model. "Credit reporting agencies like Equifax make billions of dollars collecting and selling personal data about consumers without their consent, and then make consumers pay if they want to stop the sharing of their own data," Warren said in a press release. Warren was planning to introduce a bill Friday with Sen. Brian Schatz, D-Hawaii, aimed at reforming the credit reporting industry. “Congress must act to protect consumer privacy, along with people’s ability to get a loan, to buy a car, or even get a new job,” Schatz said in the press release. “There’s a lot at stake here.” The Democratic bill would create a federal obligation for credit reporting agencies to offer free credit freezes, prevent credit bureaus from selling consumer information while a freeze is in place and require them to offer an additional annual free credit report. Warren also sent letters to the Federal Trade Commission, Consumer Financial Protection Bureau, Government Accountability Office and other credit bureaus. In the letter to the GAO, Warren raised questions over why Equifax notified the public 40 days after discovering its data breach. She said the company's response “raised several concerns” because Equifax did not provide the 143 million affected consumers with specific information on whether their personal information such as social security numbers and dates of birth were compromised. Instead, the website that Equifax created in response to discovering the breach said consumer data “may have” been exposed. On the site, Equifax offered a free credit monitoring service for a certain length of time, but after that period customers will be charged to continue the service.“Our bill gives consumers more control over their own personal data and prohibits companies like Equifax from charging consumers for freezing and unfreezing access to their credit files. Passing this bill is a first step toward reforming the broken credit reporting industry," Warren said.
Equifax two top technology executives leave company 'effective immediately' : (Reuters) - Equifax said on Friday that it made changes in its top management as part of its review of a massive data breach, with two technology and security executives leaving the company “effective immediately.” The credit-monitoring company announced the changes in a press release that gave its most detailed public response to date of the discovery of the data breach on July 29 and the actions it has since taken. The statement came on a day when Equifax’s share price continued to slide following a week of relentless criticism over its response to the data breach, Lawmakers, regulators and consumers have complained that Equifax’s response to the breach, which exposed sensitive data like Social Security numbers of up to 143 million people, had been slow, inadequate and confusing. Equifax on Friday said that Susan Mauldin, chief security officer, and David Webb, chief information officer, were retiring. The company named Mark Rohrwasser as interim chief information office and Russ Ayres as interim chief security officer, saying in its statement, “The personnel changes are effective immediately.” The company also confirmed that Mandiant, the threat intelligence arm of the cyber firm FireEye, has been brought on to help investigate the breach. It said Mandiant was brought in on Aug. 2 after Equifax’s security team initially observed “suspicious network traffic” on July 29. The company has hired public relations companies DJE Holdings and McGinn and Company to manage its response to the hack, PR Week reported. Equifax and the two PR firms declined to comment on the report.
Equifax, U.S. consumers alike will struggle to overcome massive hack - Cybersecurity experts Friday pilloried the credit reporting giant Equifax for a data breach that could potentially affect 143 million U.S. consumers, a nightmare hack that sharply underscores a new era of information insecurity. “These millions of victims will be at increased risk of fraud for the rest of their lives,” John Gunn of VASCO Data Security, an Oakbrook Terrace, Illinois firm, said in a statement. The repercussions of one of the largest cyberattacks to hit the United States continued to ripple. Equifax shares plunged more than 13 percent in value on the New York Stock Exchange, and an underground site offered what it claimed was pilfered information from the Equifax hack.Consumers who never sought a credit check with Atlanta-based Equifax may not be safe either, experts said. “Even if you are not a customer, Equifax likely has a lot of data about you,” said Kenneth Geers, senior research scientist at Comodo, a Clifton, New Jersey, company that authenticates websites and content on the internet. Equifax said Thursday that hackers were in their networks from around mid-May until July 29, and that once detected the breach was halted. The company did not say why it waited six weeks to inform the public of the massive hack. Stolen personal data can be used to commit identity fraud, create counterfeit credit cards, and make fraudulent online purchases or insurance claims, among other crimes. In addition to the 143 million U.S. consumer records – equivalent to 44 percent of the U.S. population – the company said an unknown number of Canadian and British consumer records were stolen. Data taken included names, Social Security numbers, dates of birth, addresses and, in some cases, driver license numbers. Credit card information on roughly 209,000 U.S. consumers was also stolen.
The Equifax hack could make the next hack worse - One of the reasons Equifax’s data breach is so bad is it could make future cyber attacks far more effective.Last week, the credit monitoring agency announced that sensitive information about 143m Americans had been stolen, including addresses, dates of birth, driver’s license and social security numbers, along with credit-card information for 209,000 people. There were were only 189m Americans with credit scores in 2010, according to the CFPB’s estimate. Unsurprisingly, class-action lawsuits and regulator investigations have followed.It’s actually not that hard to manage the risk of identity theft, even if it’s not as easy as it should be. Basically, people can just put on a credit freeze and keep a close eye on their credit-card statements. But the main reason this breach was so harmful is that the compromised data provides a powerful tool for targeting attacks, says Michael Tanenbaum, head of global insurer Chubb’s North American cyber business.The thing is, a lot of cyber-crime strategies exploit humans, not computers. They just use information about a person — say, address, date of birth, driver’s license and social security number — to convince him or her to give up something important, like a password or money. Despite their simplicity, those types of strategies can be effective. About 40 per cent of the cyber-insurance claims analysed by Chubb are filed for phishing, Tanenbaum says, and other types of “social engineering” fraud have been getting more common.
Forget Equifax. Facebook and Google Have the Data That Should Worry You - Just for a minute, imagine that hackers have gained access to a database containing sensitive information about hundreds of millions of people. In this totally hypothetical scenario, the theft would be comprehensive—including enough details to do real damage to those whose data had been exposed—and would involve a company that wasn’t widely recognized as a security risk. This large company would’ve exposed you, and everyone you know, to possible financial ruin. No, I’m not talking about Equifax, the Atlanta-based credit reporting agency that disclosed a massive hack late last week. Think of a comparable breach at Google, Facebook, or Amazon.com. Those companies, plus Slack, Tinder, and a half-dozen others, possess more than enough financial and personal data for hackers to steal our identities and, possibly, rack up fraudulent charges. They also have private messages, photographs, and most of our secrets. A large-scale attack on any one of these companies could make the Equifax hack, the theft of some 143 million Social Security numbers, look like petty larceny. For a sense of the potential problem, I recommend John Lanchester’s recent polemic about Facebook in the London Review of Books. Lanchester dislikes Facebook on a visceral level, and his complaints are sometimes unfair, but his central point is underappreciated. “What Facebook does is watch you, and then use what it knows about you and your behaviour to sell ads,” he writes. “It knows far, far more about you than the most intrusive government has ever known about its citizens.” Lanchester sees Facebook as a means of control and blames the company for the election of Donald Trump. Thanks to a recent disclosure, we know that Russian propagandists got at least some mileage out of the company’s ad program. But that’s not the most obvious way Facebook’s data could cause harm. What’s more likely than some dystopic mind-control scheme is simple and just as scary: The company could get hacked. Your personal Facebook data, as well as the data the company uses to target ads, contains information about your interests, your income, your sex life, your kids, and lots more. Google has a lot of this, plus the email inboxes of more than a billion people. Even a small-scale hack of someone’s Facebook or Google data could do a lot of damage. Just ask John Podesta.
Blockchain key to rethinking identity, avoiding next Equifax - BankThink - As we have known for a long time now, it is no longer good enough to use customer’s personal information for account access. Scores of companies from Ashley Madison to JPMorgan Chase to the Federal Reserve have had data breaches. It’s no wonder the system is no longer working. We’ve been using this identity system for almost two decades. True, some banks have added two-factor authentication to ID customers. However, many institutions still rely on personal information for when someone, say, calls a call center to access an account — a requirement that is just annoying. Yes, I may need to know my mother’s maiden name, first pet’s name and favorite rock band when I ring my bank. But when the agent inevitably says “we just need to ask a few more questions before we access your account,” my heart sinks. In particular, questions like “name a regular monthly payment set up on your account and the amount paid” or “name the last three transactions where your card was last used and for how much” leaves me irritated, as I’m sure they do for everyone else. Is there a solution to the broken system that is annoying at best and too easily hacked at worst? Of course. In fact, there are two options. The first solution is biometrics technology — voice, eyes and other biometrics can easily be used by banks to authenticate their customers via their smartphones. Why banks aren’t incorporating these authentication methods into their onboarding and access mechanisms defies belief. Sure, banks would need modern core systems to use such newer authentication techniques, which is a big ask. But it sure beats relying on name, address, date of birth and all the information the hackers stole from Equifax to authenticate someone. Nonetheless, I’m not a huge fan of biometrics if I’m being honest. If it is data, and biometric solutions are, the “solution” can still be compromised and replicated and mimicked. That’s why I am far more a fan of the second solution: a self-sovereign identity scheme, which isexplained really well by Rhodri Davies, a program leader at the Charities Aid Foundation, in a blog. Davies writes: Nonetheless, I’m not a huge fan of biometrics if I’m being honest. If it is data, and biometric solutions are, the “solution” can still be compromised and replicated and mimicked. That’s why I am far more a fan of the second solution: a self-sovereign identity scheme, which is explained really well by Rhodri Davies, a program leader at the Charities Aid Foundation,
Sarbanes-Oxley Internal Controls Provisions Forecast Accounting Fraud -- Jerri-lynn Scofield - A new study released last week establishes that material weaknesses in internal control provisions of the Sarbanes-Oxley Act (SOX) are good predictors of financial fraud. The study, Internal Control Weaknesses and Financial Reporting Fraud, conducted by Dain C. Donelson (University of Texas at Austin), Matthew Ege (Texas AM University), and John M. McInnis (University of Texas at Austin), examined 14,000 internal-control opinions from auditors for large and midsized corporations for the years 2004-2007. These reports provided the basis for assessing the relationship between reports of material weaknesses and reports of corporate fraud within the subsequent three years. Allow me to quote extensively from Gretchen Morgenson’s piece, Sarbanes-Oxley, Bemoaned as a Burden, Is an Investor’s Ally, in Friday’s New York Times:The exercise identified roughly 1,500 reports of material weakness at companies. And within three years, 127 of those companies faced legal actions that revealed fraud, the study said. That’s not a big number. But here’s where the study gets compelling. Auditors had identified material weaknesses in financial reporting at about 30 percent of the companies that later disclosed accounting problems. Chief executives were named in 111 of the 127 fraud cases, and chief financial officers were identified in 108 of the cases. Ege has subsequently summarised these implications in pithier terms, as reported by Accounting Today, in Internal control weaknesses correlate with financial fraud: “Although material-weakness reports mostly reflect accounting errors and portend revelations of fraud only infrequently, the fact that they precede almost 30 percent of the instances where fraud does, in fact, come to light should lead investors, regulators and legislators to take notice,” Ege said in a statement.
Wells internal review may unearth more problems: CEO Sloan - Expect more bad news from Wells Fargo in the coming months.Speaking at an investor conference in New York Tuesday morning, CEO Tim Sloan signaled that the company could uncover more examples of financial harm to its customers as part of an ongoing internal review of its sales practices. “While we work to rebuild trust and make things right for our customers, we will be reporting more progress in the months ahead that no doubt will result in additional headlines,” Sloan said.Sloan’s comments came almost a year to the day after Wells agreed to pay nearly $190 million to settle charges that more than 5,000 employees opened over 2 million unauthorized accounts in order to meet sales goals and collect bonus pay. Following a third-party review, Wells in August raised its estimate on the number of unauthorized accounts opened to about 3.5 million. The questionable sales practice extended beyond the retail bank. In July, Wells revealed that it charged more than half a million customers for auto insurance provided through National General that they did not need. The company also identified problems with its guaranteed auto protection insurance program, as well as with the way it charged fees to extend interest rate locks.
Are big-bank directors too distracted to govern? – BankThink -- Last month, the Federal Reserve proposed new supervisory guidance that purports to strengthen expectations for the directors of large U.S. banks. As Fed Gov. Jerome Powell has stressed, the proposal reflects the Fed’s view that directors should spend more time on their core responsibilities, such as setting risk tolerance and overseeing risk management. The Fed’s proposal, however, fails to address a critical shortcoming: The directors of the United States’ biggest banks are too busy to fulfill these governance responsibilities. Many directors serve on multiple boards and hold full-time executive positions. While these outside commitments provide valuable learning and networking opportunities, they also limit the time and attention that directors devote to bank governance. In an academic paper forthcoming in the Boston College Law Review, I argue that the Fed should impose limits on bank directors’ outside professional commitments to ensure that board members are not too distracted to govern. I point to Wells Fargo’s fraudulent-accounts scandal and JPMorgan Chase’s London Whale trading loss as evidence that busy bank directors inhibit the oversight of management and increase the risk of firm failure. My research identifies three specific ways in which busy directors impair risk oversight. First, directors with many outside commitments are less inclined to participate actively in corporate decision-making. Busy directors, for example, are more likely to miss board meetings, and board committees made up of busy directors meet infrequently. Second, directors with many outside commitments tend not to challenge management; as a result, firms with busy directors are more susceptible to managerial self-dealing, misconduct and excessive risk-taking. Third, busy directors experience attention shocks that distract them from company business. When a firm with which a director is associated experiences a major event — e.g., a merger or reorganization — the director’s time commitment to that firm increases substantially. The director, in turn, neglects his or her other board memberships.
Dimon slams bitcoin: ‘It’s a fraud’ - The head of the nation’s largest bank by assets on Tuesday predicted that the market for bitcoin is on the verge of crashing.JPMorgan Chase CEO Jamie Dimon described bitcoin as a currency that’s popular among criminals and warned that investors who stay in the market could take a significant hit.“Eventually it will blow up,” Dimon said at an industry conference in New York. “It’s a fraud.”Dimon compared the frenzy among investors for the cryptocurrency to the famous 17th-century Dutch Tulip bubble. “It’s worse than tulip bulb,” he said. “It won’t end well.”His comments come as the price of bitcoin has skyrocketed over the past year to more than $4,000 from about $600, according to CoinDesk.“If we had a trader who traded bitcoin, I’d fire them in a second,” Dimon said. Not only would doing so be against company rules, but it would also simply be “stupid,” he added. Dimon said one reason bitcoin will fail is that when a crash comes, "the government is going to come down" on the crytptocurrency.
JPMorgan's Dimon says bitcoin 'is a fraud' (Reuters) - Bitcoin “is a fraud” and will blow up, Jamie Dimon, chief executive of JPMorgan Chase, said on Tuesday. Speaking at an investor conference in New York, Dimon said, “The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart.” Dimon said that if any JPMorgan traders were trading the crypto-currency, “I would fire them in a second, for two reasons: It is against our rules and they are stupid, and both are dangerous.” Dimon’s comments come as the bitcoin, a virtual currency not backed by any government, has more than quadrupled in value since December to more than $4,100. Bitcoin is a digital currency that enables individuals to transfer value to each other and pay for goods and services bypassing banks and the mainstream financial system. Dimon said that if the supply were actually limited to 21 million bitcoins, it might be useful to drug dealers and murderers and people in countries with exceptionally unstable currencies. That would be “a limited market,” he said. “It is worse than tulips bulbs.” Banks and other financial institutions have largely steered clear of bitcoin since it emerged following the financial crisis. They are also concerned over its early association with online crime and money laundering. JPMorgan and many other banks have, however, invested in blockchain, the technology that tracks bitcoin transactions. Blockchain is a shared ledger of transactions maintained by a network of computers on the internet. Dimon said such uses will roll out over coming years as it is adapted to different business lines. Financial institutions are hoping blockchain can be adapted to simplify and lower the costs of processes such as securities settlement, loan trading and international money transfers. Dimon predicted big losses for bitcoin buyers. “Don’t ask me to short it. It could be at $20,000 before this happens, but it will eventually blow up.” Dimon said. “Honestly, I am just shocked that anyone can’t see it for what it is.”
Dimon Doubles Down: "My Daughter Bought Bitcoin. It Went Up, Now She Thinks She Is A Genius" --Having slammed bitcoin earlier in the day during a Barclays financial conference, calling it a "fraud" which is "worse than tulip bulbs, it won't end well" and that any JPMorgan "trader trading bitcoin" will be "fired for being stupid", the JPM CEO doubled down later in the day during an interview on CNBC's Delivering Alpha conference, saying bitcoin "is just not a real thing, eventually it will be closed." Making the bitcoin advocates' case for them, Dimon said he’s skeptical authorities will allow a currency to exist without state oversight, especially if something goes wrong. “Someone’s going to get killed and then the government’s going to come down,” he said. “You just saw in China, governments like to control their money supply.”Which, of course, is the whole point behind cryptocurrency: a method of exchange that is independent of and in apposition to conventionally accepted fiat and monetary mechanisms, one which the government frowns upon if not outright rejects, even if it is ultimately unable to block it. As an example of that, observe the reaction in bitcoin to this weekend's news that China is (allegedly) closing bitcoin exchanges: BTC dropped from $4,700 to $4,200 and... that was about it. Of course, to the CEO of JPMorgan, whichincidentally is a founding member of the Enterprise Ethereum Alliance and which nearly two years ago started a trial project using blockchain to cut trading costs, such positioning only has negative connotations:“If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in bitcoin than U.S. dollars. So there may be a market for that, but it’d be a limited market.”
Jamie Dimon Knows a Fraud When He Sees It – Outside of His Bank -- Pam Martens -- Jamie Dimon became Chief Executive Officer of JPMorgan Chase on December 31, 2005. An inordinate amount of frauds have been perpetrated inside his bank since that time, none of which the eagle-eyed Dimon spotted. But Dimon says he knows a fraud when he sees one outside of his bank. Yesterday, he took on the cryptocurrency known as Bitcoin, calling it a fraud. At a banking conference on Tuesday, Dimon said that “Bitcoin will eventually blow up. It’s a fraud. It’s worse than tulip bulbs and won’t end well.” We’re not saying Dimon is wrong about Bitcoin. In fact, more than three years ago Wall Street On Parade compared Bitcoin to the tulip bulb bubble and explained in crystal clear terms how it differs from a real currency, such as the U.S. dollar. But we are saying that Dimon’s super sleuth nose for fraud has the uncanny knack of serially failing him when it comes to Ponzi schemes and mortgage frauds and rogue derivative and commodity traders operating inside his own bank – a taxpayer subsidized institution that has richly rewarded Dimon despite the fact that his sniffer can only catch the scent of fraud outside the doors of JPMorgan Chase. On March 22, 2016, the Government Accountability Office (GAO) released a report that noted that the U.S. Justice Department had earlier assigned a $1.7 billion forfeiture against JPMorgan Chase “for its failure to detect and report the suspicious activities of Bernard Madoff,” the largest fraud ever perpetrated against the investing public. The GAO stunningly found that because the bank “failed to maintain an effective anti-money-laundering program and report suspicious transactions in 2008, it contributed to its own bank customers “losing about $5.4 billion in Bernard Madoff’s Ponzi scheme.” Justice Department investigative material, much of which came from Irving Picard, the trustee for the Madoff victims’ fund, showed that JPMorgan Chase had relied on unaudited financial statements and skipped the required steps of bank due diligence to make $145 million in loans to Madoff’s business. Lawyers for Picard wrote that from November 2005 through January 18, 2006, JPMorgan Chase loaned $145 million to Madoff’s business at a time when the bank was on “notice of fraudulent activity” in Madoff’s business account and when, in fact, Madoff’s business was insolvent. The JPMorgan Chase loans were needed because Madoff’s business account, referred to as the 703 account, was “reaching dangerously low levels of liquidity, and the Ponzi scheme was at risk of collapsing,” according to Picard. JPMorgan, in fact, “provided liquidity to continue the Ponzi scheme,” the Picard investigators found.
Wall Street Is Attempting to Clone Loyal, Non-Whistleblower Workers -- Pam Martens -- Last month, Reuters reported that Goldman Sachs was planning “to begin” using personality tests to assist it in hiring personnel “in its banking, trading and finance and risk divisions.”It’s highly unlikely that Goldman Sachs is just beginning to use personality tests since other major firms on Wall Street have been using them for at least three decades – and not in a good way.The Reuters article was penned by Olivia Oran, who also wrote in June of 2016 that major Wall Street firms such as Goldman Sachs, Morgan Stanley, Citigroup and UBS were “exploring the use of artificial intelligence software to judge applicants on traits – such as teamwork, curiosity and grit.” The article further noted that one of the goals of the artificial intelligence software is to “avoid the expense of problem hires and turnover…”All of the firms mentioned have experienced employees that, in their view, were “problem hires.” The public, however, has viewed those same employees as public interest-motivated whistleblowers.In 2012, Goldman Sachs Vice President Greg Smith stunned the firm by submitting his resignation via an OpEd in the New York Times, charging the firm with a corrupt environment: “It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as ‘muppets,’ sometimes over internal e-mail,” Smith said. He called the environment at Goldman “as toxic and destructive as I have ever seen it.” It takes a lot of guts to resign from Goldman Sachs via the New York Times. But there has been lots of gutsy whistleblowing by brilliant recruits with pristine resumes. Richard Bowen was a former Citigroup Senior Vice President who repeatedly alerted his superiors in writing that potential mortgage fraud was taking place in his division. At one point, Bowen emailed a detailed description of the problem to top senior management, including Robert Rubin, the former U.S. Treasury Secretary and then Chairman of the Executive Committee at Citigroup. Bowen’s reward for elevating serious ethical issues up the chain of command was to be relieved of most of his duties and told not to come to the office. Bowen testified before the Financial Crisis Inquiry Commission in 2010. In 2011, Bowen made the ultimate gutsy move: he revealed the sordid details on the CBS program 60 Minutes.
Banks see opening for return to student lending, says new CBA chief— Since 2010, the federal government has been the nation's primary student lender. But the incoming chairman of the Consumer Bankers Association says the government's record as a credit provider leaves much to be desired.“We believe we have the expertise” to underwrite student loans “better,” said Brad Conner, vice chairman of consumer banking at the $150 billion-asset Citizens Bank in Providence, R.I., who will become CBA chairman next year.Conner said continued problems with student lending under the government's watch may open the door for private lenders to get back into the space. He said the CBA plans to raise awareness about exploding student loan debt in 2018. Brad Conner, incoming chairman of the Consumer Bankers Association, said problems with student lending by the government may open the door for private lenders to get back into the space. "We believe we have the expertise" to do "better." “What is happening is the overwhelming majority … of student lending being done in this country is being done by the federal government and it typically is underwritten without assessing the students' ability to repay,” Conner said. In an extended interview, Conner also expressed hope for banks to expand small-dollar lending if the Consumer Financial Protection Bureau cracks down on more expensive products offered by payday lenders and other nonbanks. He also reiterated the industry's support for establishing a commission to oversee the CFPB, as opposed to a single director, and said bankers will continue to fight to repeal the so-called Durbin amendment's cap on debit interchange fees.
Good news for fintech seen in CFPB’s ‘no-action’ move - The Consumer Financial Protection Bureau created a buzz in the fintech community when it issued a no-action letter to the online lender Upstart Network. It is the first issued to a fintech company, and it gives the San Carlos, Calif., startup a bit of a break from regulatory enforcement as it increasingly uses alternative data to make credit and pricing decisions — a practice that raises regulatory concerns. In return, Upstart will regularly report lending and compliance information to the CFPB to aid the bureau’s understanding of the real-world impact of alternative data on lending. The arrangement is part of the bureau's Project Catalyst program that is meant to foster innovation. In an interview Friday, Upstart co-founder and CEO Dave Girouard explained why the fintech applied for the letter and how it works. Girouard was previously president of Google Enterprise and a software developer at Accenture.
As uncertainty swirls, CFPB keeps on regulating - The Consumer Financial Protection Bureau may face an unsteady political environment and the potential of a leadership shakeup, but a new CFPB report on the agency's supervisory priorities has experts warning banks not to rest on their laurels. While the bureau's latest issue of Supervisory Highlights is somewhat of a relief to banks worried about their implementation of new mortgage disclosures, the 48-page report raised concerns about other areas, including loss mitigation efforts, checking accounts, overdraft protection and auto loan servicing, among others. Despite speculation that CFPB Director Richard Cordray may run for governor in Ohio, or be fired as the Trump administration pursues regulatory relief, observers said banks cannot afford to overlook the areas still top of mind for CFPB examiners and potentially their enforcement attorneys. "It would be at your own peril to ignore them, because whether Cordray stays or Trump decides to go with someone [to replace him], the priorities are indicative of where the agency may go," said Joe Jacquot, a partner and business attorney at Foley & Lardner. Bankers have long viewed the semiannual report as a must-read because it signals specific issues that the CFPB is focused on based on the past six months of supervisory exams. The latest report, which was released Tuesday, focuses on supervisory activity from January to June of this year. The report for the first time provided data on how matters that originate from CFPB exams get investigated for possible public enforcement actions. Jacquot, a former chief deputy attorney general of Florida, said even if the bureau chooses not to pursue enforcement actions based on certain supervisory findings, another reason financial firms pay close attention to the report is that it provides plenty of fodder for other regulators and law enforcement officials.
TCF wins partial dismissal of CFPB overdraft suit - TCF Financial has scored a partial victory in its ongoing legal battle with the Consumer Financial Protection Bureau over sales of its overdraft protection services.A federal judge on Friday dismissed some of the CFPB’s claims against the Wayzata, Minn., company.At issue in the case is whether TCF tricked customers into signing up for costly overdraft protection services. The CFPB sued the $22.1 billion-asset company in January, claiming it used shoddy and aggressive sales tactics — including allegedly withholding information from customers — to boost overdraft enrollment. TCF relies more heavily on overdraft fees than most other banks its size and it is an aspect of the company's business model that investors have worried could make TCF a target for more heightened regulatory scrutiny.Under the ruling, a district court judge in Minnesota tossed out the CFPB’s claims that TCF violated Regulation E — the Federal Reserve rule that requires banks to obtain consent from customers before enrolling them in overdraft protection. But TCF isn’t out of legal hot water yet. The judge let stand some CFPB charges that TCF violated a key provision of the Dodd-Frank Act that prohibits companies from engaging in unfair and deceptive practices in selling consumer products. The CFPB cannot assert claims under the Dodd-Frank statute prior to July 21, 2011, the day the law took effect, according to the ruling. The judge, however, denied TCF’s motion to dismiss the CFPB’s claims after that period.
How a community bank took the fall for the financial crisis -- Since the financial crisis has ended, the public has struggled to make sense of why big-bank CEOs weren’t pursued for their role in originating and selling faulty mortgages on a massive scale.A new PBS "Frontline" documentary airing Tuesday evening, “Abacus: Small Enough to Jail,” may reignite those questions. It tells the story of Thomas Sung, a Chinese immigrant and attorney who started a bank in Chinatown that became the only U.S. bank indicted for mortgage fraud related to the 2008 crisis. The documentary raises the question of why New York officials devoted five years to prosecuting the $300 million-asset Abacus Federal Savings Bank for 30 mortgages with alleged fake documentation, but didn't go after the many large banks that originated thousands of fraudulent home loans. “There was this notion that we couldn’t bring criminal action against them because the collateral consequences of an institution that was so large, so internationally connected, that indicting them or bringing criminal charges against them could wreck the entire financial system,” Neil Barofsky, former head of mortgage fraud at the U.S. Attorney’s Office in New York, says in the program. The program is sympathetic to Sung and his three daughters, who work at the bank and fought the case alongside him. S ung is shown watching “It’s a Wonderful Life” with his wife, speaking of the movie's hero, small-town banker George Bailey, as an inspiration, and strategizing with his daughters. The cameras frequently cut to scenes of street life in Chinatown. Even so, the documentary takes a deep dive into the charges brought against the bank and interviews Cyrus Vance, the New York district attorney, and colleagues who worked on the case. It also features a juror in the trial who thought the bank should have been found guilty.
Banking agencies propose changes to CRA definitions — The three federal prudential bank regulators on Wednesday proposed revising certain definitions in Community Reinvestment Act regulations to stay aligned with a recent rule from the Consumer Financial Protection Bureau. Under the proposal, the Federal Deposit Insurance Corp, Office of the Comptroller of the Currency and Federal Reserve Board would update definitions of terms such as "home mortgage loan" and "consumer loan" to be consistent with new requirements implemented by the CFPB under the Home Mortgage Disclosure Act. The HMDA changes go into effect in January 2018. Since 1995, the agencies “have conformed certain definitions in their respective CRA regulations to the scope of loans" used for HMDA "and believe that continuing to do so produces a less-burdensome CRA performance evaluation process,” the three regulators said in a press release. Under the new CFPB rule, most consumer-facing mortgage transactions must be reported under HMDA, as long as they are collateralized with a home. Unsecured home improvement loans, however, would not be subject to such reporting requirements. The draft proposal released Wednesday would also make technical changes and remove outdated references to the Neighborhood Stabilization Program. The agencies said they expect the proposed CRA changes to go into effect in January. The public will have 30 days to comment on the proposals.
Mnuchin demurs on question of GSEs' capital -- Despite a direct request by six Democratic senators that Fannie Mae and Freddie Mac be allowed to rebuild capital, Treasury Secretary Steven Mnuchin on Thursday did little to clarify the administration's thinking on the issue. The six senators, including ranking Senate Banking Committee member Sherrod Brown, of Ohio, raised concern in a letter to Mnuchin and Federal Housing Finance Agency Director Mel Watt that the government-sponsored enterprises could have zero capital on Jan. 1. The mortgage giants are still sending Treasury all of their income as required by stock purchase agreements. But asked about the mortgage giants' capital position at an event hosted by Politico on Thursday, Mnuchin said the administration plans to address housing finance reform in 2018. Until then, he said, "We expect our dividends to be paid." "We need to fix Fannie and Freddie," Mnuchin said at the Politico Pro Policy Summit. "They're only operating right now from a line with the Treasury." The Treasury secretary gave a similar response during congressional testimony in May, when he recounted telling Watt "that it was our expectation at Treasury that [the GSEs] would pay us the dividend and we hope they continue to do so, per the agreement.”
Senate confirms new No. 2 for HUD - — The Senate on Thursday confirmed Pam Patenaude to be the deputy secretary at the Department of Housing and Urban Development.The Senate voted 80-17 to confirm Patenaude, who previously served at HUD from 2001 to 2007, first as assistant deputy secretary for field policy and management and later as the agency’s assistant secretary for community, planning and development. After leaving HUD, she became president of the J. Ronald Terwilliger Foundation for Housing America’s Families. Her previous experience at HUD is likely to help her assist HUD Secretary Ben Carson, a former neurosurgeon who has little experience in the housing market. Her nomination was approved by the Senate Banking Committee in April, but it was placed on hold by some Democratic senators after she defended significant proposed cuts in HUD’s budget by the Trump administration.
Trump picks Brian Montgomery to lead FHA --After months of speculation, Trump announced his intent to nominate Montgomery for FHA commissioner Wednesday. Montgomery will take over for acting commissioner Edward Golding. The Mortgage Bankers Association issued a statement of support for the president’s pick, urging the Senate to move quickly in accepting the nomination.“MBA applauds the nomination of Brian Montgomery to lead the Federal Housing Administration,” MBA CEO David Stevens said. “His previous experience will serve him well in this position.”“I hope the Senate will move quickly to confirm Brian and we look forward to working with him, Secretary Carson, and others in the Administration to ensure a strong, robust FHA program that can serve its mission of providing affordable housing opportunities, both rental and owned, for all Americans, especially those with low and moderate incomes and first-time homebuyers,” Stevens said.If accepted into the position, it will be Montgomery's second time as FHA commissioner. He previously held the job under Former President George W. Bush, staying on for six months after former President Barack Obama's inauguration. A statement from the White House explained the previous success of the FHA under Montgomery’s leadership.
SBA bypasses banks in hurricane recovery efforts -- A growing number of bankers want to partner with the Small Business Administration on disaster relief as rebuilding estimates tied to Hurricane Harvey keep mounting and as Floridians and Georgians assess damage from Irma.The SBA, however, is giving little indication that it would welcome the help.All of the $450 million in funds the SBA should receive from a recently passed disaster recovery package are earmarked for direct relief, spokeswoman Carol Chastang said. No funds have been set aside to back an indirect program of bank-made, government-guaranteed loans — even though a 2008 law directed the SBA to do just that. Working solo, the SBA has moved more rapidly than in previous large-scale disasters to get funds flowing to Harvey victims. As of Sunday, the agency had approved more than $100 million in loans, including 95 loans totaling $8.5 million to small businesses. The SBA has also opened satellite offices in the Texas communities of Houston, Port Aransas and Rockport to serve as one-stop locations for small businesses that need assistance.
Early estimates put CMBS exposure to Irma in tens of billions -- Commercial mortgage servicers are taking steps to assess damage, payment delays and insurance disbursements brought on by Hurricane Irma, which made landfall in the Florida Keys early Sunday as a Category 4 storm and weakened as it and moved up the west coast, as well as for Hurricane Harvey, which submerged large parts of Houston two weeks ago. The process of contacting borrowers in the affected areas is expected to take weeks. In the meantime, the only way to determine potential CMBS exposure is by scouring databases for securitized loans in counties that the Federal Emergency Management Agency has declared disaster areas – something that has yet to take place in Florida.
Harvey, Irma deliver one-two punch to battered flood insurance program - - Hurricanes Harvey and Irma were a double body blow for the already troubled National Flood Insurance Program. The insurance program, which is part of FEMA, provides the only protection against flooding that most homeowners and businesses can get. Private policies typically only cover the wind damage in a hurricane, not flood damage. But after a series of floods caused by major storms in recent years, including Hurricane Katrina in 2005 and Sandy in 2012, the program is roughly $25 billion in debt. It has less than $2 billion cash on hand, with the authority to borrow only $6 billion more. Experts say the claims from Harvey and Irma will run into the tens of billions. Reinsurance policies purchased by FEMA could cover about $1 billion, a small fraction of what the program will need. Tragically for the homeowners, most homes in Harvey and Irma's paths don't have flood insurance. Still, Florida and Texas between them have nearly half the 5 million flood insurance policies written nationwide. About 400,000 homes in the counties affected by Harvey have policies, as do about 500,000 homes in counties along the Florida Gulf Coast. The average claim in the past 12 years has been for about $50,000, which means this storm could quickly deplete what little the cash the program has. Enki Research, a disaster analysis company, estimated Monday evening that Harvey will result in $16 billion in claims against the flood insurance program and Irma will cost the program an additional $12 billion. Together the two storms would top the $20.7 billion in claims from Katrina, and be more than triple the nearly $9 billion in claims from Sandy, the second biggest hit to the program until now. And the financial strain is only going to get worse in years to come, experts say, because of climate change and more development in coastal areas.
Irma May Force Florida Insurers to Turn to Deeper Pockets - With Hurricane Irma’s destructive force having pushed north, Floridians are beginning to check on what has become of their homes. They may also want to check on their insurers. The big national carriers like State Farm and Allstate cut back on writing homeowners’ insurance policies in Florida years ago, citing catastrophic risks and unhelpful state regulators. Those reductions left a vacuum that was filled, initially, with a state-owned insurer, Citizens Property Insurance. Eventually, the state offered incentives to coax some brave new insurers into the market. As a result, all that stands between many Florida homeowners and potential ruin is one state-owned insurer and dozens of relatively little-known companies that do most — or all — of their business in the state. They all have the benefit of the Florida Hurricane Catastrophe Fund, which, with no major storms in the past 12 years, has $17 billion at the ready — a sum that may not be nearly enough. “This can really be a hurricane that can bust the insurance industry,” Whether policyholders can be made whole will most likely depend on reinsurance — the custom-tailored insurance that the Florida insurers themselves take out — and other financial vehicles that they have to fall back on. But the variables at play — the storm’s path, the companies’ balance sheets and the details of their reinsurance contracts — could produce differing fortunes for the various companies. By missing a direct hit on Miami, and inflicting less damage than expected on Florida’s Atlantic Coast, Irma turned out to be bad, but not as bad as experts had feared. AIR Worldwide, a catastrophe modeling firm in Boston, predicted on Monday that Irma’s insured damage in the United States would cost the industry $20 billion to $40 billion. If insured property in the Caribbean is included, the total projected losses would range from $25 billion to $55 billion, according to Kevin Long, a spokesman. Insurer strength could be more of an issue in Florida than it was in eastern Texas, where most of Hurricane Harvey’s damage was caused by inland flooding. Homeowners’ insurers do not generally provide flood insurance. While Irma brought flooding to Florida, too, the greater damage was expected to be from high winds, a peril covered by standard homeowners’ policies.
Auto insurance harder to buy after Harvey - Auto insurance companies have restricted options for Houston-area drivers looking to purchase new policies and replace cars flooded by Hurricane Harvey, and comprehensive rates are expected to rise after the loss of an estimated half-million vehicles.Some carriers have imposed temporary limits on selling insurance to customers in Harvey's path, hesitant to assume new risk even as floodwaters recede. Experts expect longer-term changes as carriers reassess their rates after a spate of intense storms across the state."Look at our most recent history," said Mark Hanna, spokesman for the Insurance Council of Texas. "This the third flood you've had affecting tens of thousands of vehicles, and that's had a huge impact on comprehensive coverage."All major carriers ceased extending new coverage immediately before and after the storm, a standard practice within the industry. But some remain reluctant to onboard customers a week and a half after the rainfall at last stopped, citing concerns about continued flooding.Allstate has maintained a moratorium on new coverage throughout most of Harris County and other storm-affected areas as it processes thousands of claims. Spokesman Roberto DeLeon said the company has lifted such restrictions in some places but hasn't yet determined when it will resume normal business throughout the region."We are monitoring the situation day by day," he said. "We take it down to the ZIP code level." State Farm agents began writing new insurance on Tuesday, but the company hasn't yet resumed online sales. On Friday, it had received about 33,100 claims, up from about 27,500 at the end of last week.American Access Casualty Company, a small carrier based in Illinois, has slowly resumed sales as it handles a record number of claims. Last year, it processed about 300 in Texas, its largest market, and this year, it expects to receive as many as 2,200. President Dan Cummings said the company had stopped issuing comprehensive coverage in about 40 counties after the storm and has since resumed sales in about half of them.
You may not live in Florida or Texas, but your insurance rates could spike because of hurricanes - You may not live in one of the areas hit by hurricanes Harvey and Irma, but that doesn't mean your insurance rates will go unscathed.Motorists and homeowners throughout Texas and Florida as well as those who live anywhere from Alabama to Wyoming could see their premiums rise, as insurance companies pay out billions of dollars to customers whose properties were destroyed or damaged. For example, hurricane winds could damage your roof or flip over your car. The estimated U.S. insured losses, excluding any National Flood Insurance Program claims, are $20 billion to $25 billion from Harvey and $40 billion to $60 billion from Irma, according to JLT Re, a global reinsurance brokerage and consulting firm. Experts say insurers are looking to stay flush as they cover their reinsurance policies — which keep them insured and able to mitigate risk — while trying to prepare forany extreme future weather that could harm their customers. "There’s an increased perception of risk. There's less capital supporting the insurance industry, and there’s equal demand," says David Havens, managing director of investment bank Imperial Capital. "The way insurers respond to that is to raise prices, because they need to replenish."
Overdraft fee revenue helped, not hurt, by better disclosures - Overdraft fees are a much-maligned practice, but they continue to be a growing source of revenue for many banks, according to new data from the Federal Deposit Insurance Corp. Each of the 15 largest retail banks posted overdraft revenue growth starting in the first quarter of 2015 — when the FDIC first required certain banks to provide a breakout — through the second quarter of this year. Overdrafts at the $134 billion-asset KeyCorp in Cleveland rose the most during that period: 74%, to $34.3 million. Some smaller banks also saw overdraft income expand. At the $2.6 billion-asset Canandaigua National in New York, overdrafts rose 180% over the 10 quarters to $2.1 million. The bank made no acquisitions during that period.For all of 2016, overdraft fees at the 620 banks required to report such data to the FDIC rose 2.2% to $11.4 billion from a year earlier, according to Brian Martin, an analyst at FIG Partners.Overdrafts have gained popularity even as elected officials and regulators have threatened crackdowns and taken action. The Consumer Financial Protection Bureau in August laid the foundation for increased disclosure requirements. Sen. Cory Booker, D-N.J., recently queried banks whether they’re enrolling customers without their consent. And in January the CFPBsued TCF Financial in Wayzata, Minn., for alleged deceptive and abusive overdraft practices.The economic recovery is one big reason for the continued expansion of banks’ overdraft business, said Jeff Harper, president of BSG Financial Group, a bank consulting firm in Louisville, Ky. “It seems counterintuitive, but when consumer confidence rises, you see a spike in overdrafts,” Harper said. Since the FDIC’s overdraft disclosure requirements took effect two years ago, the national average overdraft fee has barely budged, according to the financial data provider RateWatch. The average fee for covered checks rose 91 cents to $34.07, while the average for returned checks increased 87 cents to $34.06.
Black Knight Mortgage Monitor: "Purchase Lending Hits Highest Level Since 2007" --Black Knight Financial Services (BKFS) released their Mortgage Monitor report for July today. According to BKFS, 3.90% of mortgages were delinquent in July, down from 4.51% in July 2016. BKFS also reported that 0.78% of mortgages were in the foreclosure process, down from 1.09% a year ago. This gives a total of 4.68% delinquent or in foreclosure. Press Release: Black Knight’s Mortgage Monitor: Purchase Lending Hits Highest Level Since 2007 Despite Continued Headwinds from Tight Lending; Refinance Share at 16-Year Low Reviewing second quarter mortgage origination volumes, Black Knight finds that while overall mortgage lending saw a 20 percent increase over Q1 2017, total volumes were down 16 percent from Q2 2016. Additionally, although purchase lending hit its highest level in 10 years, the total number of purchase mortgages being originated still falls far below pre-crisis (2000-2003) averages. As Black Knight Data & Analytics Executive Vice President Ben Graboske explained, more stringent credit requirements enacted in the wake of the Great Recession may be hampering purchase lending volumes. “We saw positive growth in lending in the second quarter, with $467 billion in first lien mortgages originated,” said Graboske. “While down 16 percent from a year ago, that marks a 20 percent increase in mortgage lending over Q1. Drilling down into the make-up of those originations, we see that refinance lending made up just 31 percent of all Q2 originations – the lowest such share in over 16 years. Refinance volumes were down as well, falling 20 percent from Q1, but that drop was more than offset by a 57 percent seasonal rise in purchase lending. Purchase originations totaled $321 billion in Q2 2017; up six percent from last year, and the highest quarterly volume since 2007. As a result of growing average loan amounts for purchase originations, the total dollar amount of purchase originations is higher than averages seen from 2000-2003, prior to both the peak in home prices and the Great Recession that followed. This is partly due to rising home prices, but also comes as a result of an all-but-total absence of second lien usage for purchases, a shift toward high-dollar/low-risk loans among non-agency lenders and a higher share of cash purchases at the lower end of the market.
Home prices, jobs keeping mortgage defaults at bay - There will be fewer mortgage loans going into default in the next year as home prices continue to rise and more people get jobs, CoreLogic said. There were 4.5% of mortgages in some stage of delinquency (30 days or more past due including those in foreclosure) in June 2017. May's delinquency rate was 4.5%, while for June 2016, the rate was 5.3%.June's foreclosure inventory rate of 0.7% was the lowest in nearly 10 years, when it was also 0.7% in July 2007. The index peaked at 3.6% in December 2010.."The CoreLogic Home Price Index increased 6% and payroll employment grew by 2.2 million jobs in the year ending June 2017, supporting further declines in delinquency rates," said CoreLogic Chief Economist Frank Nothaft in a press release. "The forecast for the coming year includes 5% home-price appreciation and further job growth, putting renewed downward pressure on mortgage delinquency rates."Rising home prices give those who fall behind on their loans an opportunity to sell the property and have enough in proceeds to pay off the mortgage.The percentage of seriously delinquent mortgages was 1.9%, down from 2.5% in June 2016.Mortgages with payments between 30-59 days past due, was 2% in June, down slightly from 2.1% one year prior. There were 0.6% of mortgages whose payments were between 60 and 89 days late, compared with 0.7% a year ago.The share of mortgages that transitioned from being current for the previous month to becoming 30 days past due during June was 0.9%. This was unchanged from June 2016.By comparison, in January 2007, just before the start of the financial crisis, the current-to-30-day-transition rate was 1.2% with the peak occurring in November 2008 at 2%. Mississippi had the highest delinquency rate in June, at 8.2%, followed by New Jersey at 7% and New York at 6.9%.
MBA: Mortgage Applications Increase in Latest Weekly Survey --From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey: Mortgage applications increased 9.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 8, 2017. This week’s results included an adjustment for the Labor Day holiday.... The Refinance Index increased 9 percent from the previous week. The seasonally adjusted Purchase Index increased 11 percent from one week earlier. The unadjusted Purchase Index decreased 13 percent compared with the previous week and was 7 percent higher than the same week one year ago. ... The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to 4.03 percent from 4.06 percent, with points increasing to 0.40 from 0.38 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The first graph shows the refinance index since 1990. Refinance activity will not pick up significantly unless mortgage rates fall well below 4%.
New home purchase apps rebounded in August -- With interest rates lower than expected and existing-home prices driving demand, applications for new-home purchases rebounded in August, increasing 6.8% from the previous year, according to the Mortgage Bankers Association.New-home purchase applications grew by 7% from July to August.By product type, 71.9% of these applications were for conventional loans and 14.4% for Federal Housing Administration loans. Department of Veterans Affairs loans comprised 12.7% of new-home purchase applications and Rural Housing Service/U.S. Department of Agriculture loans made up 0.9%.The average loan size grew by $5,457 from July to August."Average loan size for new homes increased in August to $334,940, the highest level since the series began," said Lynn Fisher, vice president of research and economics for the Mortgage Bankers Association, in a press release."More than one-third of applications for new homes in our August survey came from Florida and Texas. It is unclear what impact hurricanes Harvey and Irma will have on housing starts in the region in coming months, but it is likely that recent new home sales will be delayed in breaking ground," she said.And in addition to this potential delay, storms like Harvey may reshape how and where Americans build homes, as builders and developers typically want to keep homes as inexpensive as possible, rather than favoring tighter building codes and taking in to account vulnerable locations the way insurers do. New single-family home sales were running at a seasonally adjusted annual rate of 665,000 units in August, according to MBA estimates.
After The Storms Are Over: America Can't Afford To Rebuild -- Ilargi -- A number of people have argued over the past few days that Hurricane Harvey will NOT boost the US housing market. As if any such argument would or should be required. Hurricane Irma will not provide any such boost either. News about the ‘resurrection’ of New Orleans post-Katrina has pretty much dried up, but we know scores of people there never returned, in most cases because they couldn’t afford to.And Katrina took place 12 years ago, well before the financial crisis. How do you think this will play out today? Houston is a rich city, but that doesn’t mean it’s full of rich people only.Most homeowners in the city and its surroundings have no flood insurance; they can’t afford it. But they still lost everything. So how will they rebuild?Sure, the US has a National Flood Insurance Program, but who’s covered by it?Besides, the Program was already $24 billion in debt by 2014 largely due to hurricanes Katrina and Sandy. With total costs of Harvey estimated at $200 billion or more, and Irma threatening to cause far more damage than that, where’s the money going to come from?It took an actual fight just to push the first few billion dollars in emergency aid for Houston through Congress, with four Texan senators voting against of all people. Who then will vote for half a trillion or so in aid? And even if they do, where would it come from?
Lawler: CPS-Based Household Growth Slowed Significantly in 2017, though Not as Much as Raw Numbers Suggest --From housing economist Tom Lawler: CPS-Based Household Growth Slowed Significantly in 2017, though Not as Much as Raw Numbers Suggest The Census Bureau yesterday released its “Income and Poverty in the United States” report for 2016, which is based on the results from the 2017 Current Population Survey (CPS) Annual Social and Economic (ASEC). While the report focuses mainly on household and individual incomes and poverty rates, it also shows estimates of the number of US households based on the CPS/ASEC results. According to the report, the CPS/ASEC-based estimates of the number of US households in March 2017 was 126.224 million, just 405,000 above the 125.819 million estimate from the previous year’s report. This meager gain, if “accurate,” would reflect a sharp slowdown in household growth.As folks who regularly read my report know, however, part of this sharp slowdown in growth reflects the substantial downward revisions in US population estimates that were released at the end of last year. The 2017 CPS/ASEC estimates reflect these downward revisions, but the 2016 estimates do not. To remind folks, late last year Census released its ‘2016 vintage” population estimates, which incorporated an improved methodology for estimating net international migration that resulted in material downward revisions of the US resident population, as shown in the table below.
Lawler: ACS-Based Household Growth Slowed Last Year: Homeownership Rate Estimate Up, But Barely - From housing economist Tom Lawler: ACS-Based Household Growth Slowed Last Year: Homeownership Rate Estimate Up, But Barely The Census Bureau released the results of its 2016 American Community Survey, which provides a wide range of estimated statistics about people and housing. On the housing front, the ACS-based estimate of the number of occupied housing units (or households) for 2016 (yearly average) was 118,860,065, up just 651,815 from the estimate from the 2015 ACS. The ACS-based homeownership rate for 2016 was 63.1%, up just a tad from the 63.0% in 2015. The growth rate of nonfamily households outpaced the growth in family households last year, with the fastest growth coming in nonfamily households with two or more people. This growth in part reflected a sharp jump in roomers and boarders.
Leading Index for Commercial Real Estate "Slips" in August -- Note: This index is possibly a leading indicator for new non-residential Commercial Real Estate (CRE) investment, except manufacturing. From Dodge Data Analytics: Dodge Momentum Index Slips in August The Dodge Momentum Index moved lower in August, falling 2.4% to 129.1 (2000=100) from its revised July reading of 132.2. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The decline in August can be attributed to an 8.7% drop in the commercial component of the Momentum Index, while the institutional component rose 7.3%. The commercial component has seen a steep rise over the past year as large projects – particularly office buildings – entered the planning cycle. The August retreat for the commercial component brings planning activity back to a level more consistent with a sustainable pace of development.
Americans Seen "Flirting With Financial Disaster" As 2Q Credit Card Debt Soars Back To 2008 Highs -- With credit card data in for Q2 2017, American households look to once again be on a collision course with the ever-elusive $1 trillion goal that narrowly escaped their clutches in 2008. With nearly $940 billion in credit card debt outstanding, 2Q 2017 marked the second highest consumer revolving debt balance since the previous peak in 2008. Per WalletHub: All of which adds up to nearly $8,000 of credit card debt per household, up 5% YoY versus flat-ish wages. Of course, the more surprising component of the 2Q 2017 credit card data is not that banks continue to trip over one another for the 'opportunity' to underwrite Americans' purchases of fidget spinners, but rather that they continue to do so despite the rather ominous recent rise in charge-offs. Not surprisingly, Morgan Stanley recently noted the same trend in subprime credit card delinquencies...which they apparently found staggering in light of the fact that 'everything is awesome' in the job market. Of course, after spending the entire month of August analyzing those seemingly contradictory facts, Morgan Stanley came to many of the same conclusions that we note a regular, recurring basis. Apparently, soaring credit card delinquencies have something to do with stagnant wages in the face of soaring healthcare costs and rising rents...who could have guessed that? Investors ask, "Why are card losses rising if employment is so good?" Our deep dive & quant work shows subprime is stretched from higher rent, healthcare costs & low wage growth, with lower credit availability a coming drag. A Tale of Two Consumers, with the subprime consumer increasingly at risk, driving up net charge-offs (NCO) and lowering EPS: The economy is solid and unemployment is very low, but credit card delinquencies have been increasing... so we spent the month of August delving into what is really going on with the US consumer. We found that the average consumer is in good shape but the financial pressures on subprime consumers are high and, critically, rising..
The Chicago Fed revises its Adjusted Credit Conditions Index -- Last week the Chicago Fed announced backdated revisions to its Adjusted Financial Conditions Index. Since this changes their interpretation somewhat, I wanted to flesh this out. The Chicago Fed has a "Financial Conditions Index" which is self-explanatory, as well as several sub-indexes, one of which, the "leverage" subindex, it has identified as leading. It also has an "Adjusted Financial Conditions Index," which is supposed to calibrate how loose or tight credit conditions are *relative to* background economic conditions --i.e., are financial conditions more or less tight than they have typically been given the data background. Because the Adjusted Index appeared to track, and somewhat lead, the Senior Loan Officers Survey, and because it is reported weekly rather than quarterly, I report this Index every weekend. The "updates" to the Index change its values considerably. First of all, the new Adjusted Index is much less volatile, but also somewhat less leading: Secondly, it no longer leads the un-adjusted index at all in terms of peaks or troughs, although it does appear to have higher (i.e., more tight) values in the several years leading up to recessions: If we add +0.5 to the value of the updated Adjusted Index, and average it over a quarter, it does appear typically to lead the Senior Loan Officer Survey by one or two quarters, although note the exception from 2014-16: With that modification (i.e., adding +0.5 to the Adjusted Index as the line between "loose" and "tight" credit conditions, I will continue to track it weekly as a long leading indicator of promise.
Michigan Consumer Sentiment: Edges Down in September - The University of Michigan Preliminary Consumer Sentiment for September came in at 95.3, down from the August Final reading of 96.8. Investing.com had forecast 95.1. Surveys of Consumers chief economist, Richard Curtin, makes the following comments:Consumer confidence edged downward in early September due to concerns over the outlook for the national economy. Consumers' assessments of current economic conditions improved, however, with the Current Conditions Index reaching the highest level since November of 2000. The two hurricanes had a greater impact on expected economic conditions. Across all interviews in early September, 9% spontaneously mentioned concerns that Harvey, Irma, or both, would have a negative impact on the overall economy. Among those who mentioned the hurricanes, the Sentiment Index was 80.2, while among those who did not spontaneously mention either hurricane, the Sentiment Index remained unchanged from last month at 96.8. Given the widespread devastation in Texas and Florida, it is not surprising to find these very negative initial reactions, nor would it be surprising if these negative assessments last longer than following most past hurricanes. While consumers anticipated slight increases in gas prices and a slightly higher overall inflation rate, those concerns were neutralized by the best assessments of their financial situation in more than a decade. Renewed gains in incomes as well as rising home and equity values have acted to counterbalance the negative impacts from the hurricanes. Given the current resilience of consumers, recent events are unlikely to derail confidence. [More...] See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.
Retail Sales decreased 0.2% in August - On a monthly basis, retail sales decreased 0.2 percent from July to August (seasonally adjusted), and sales were up 3.2 percent from August 2016. From the Census Bureau report: Advance estimates of U.S. retail and food services sales for August 2017, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $474.8 billion, a decrease of 0.2 percent from the previous month, and 3.2 percent above August 2016. ... The June 2017 to July 2017 percent change was revised from up 0.6 percent to up 0.3 percent.This graph shows retail sales since 1992. This is monthly retail sales and food service, seasonally adjusted (total and ex-gasoline). Retail sales ex-gasoline were down 0.4% in August. The second graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993. Retail and Food service sales, ex-gasoline, increased by 3.1% on a YoY basis. The increase in August was below expectations, and sales in June and July were revised down. Note: Hurricane Harvey impacted sales in August.
August Retail Sales: Down 0.2% MoM, Worse Than Forecast - The Census Bureau's Advance Retail Sales Report for August released this morning showed a decrease over the July figures. Headline sales came in at -0.2% month-over-month to one decimal. Today's headline number was below the Investing.com consensus of 0.1%. Core sales (ex Autos) came in at 0.2% MoM. Figures were revised going back to June 2016. Here is the introduction from today's report: Advance estimates of U.S. retail and food services sales for August 2017, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $474.8 billion, a decrease of 0.2 percent (±0.5 percent)* from the previous month, and 3.2 percent (±0.7 percent) above August 2016. Total sales for the June 2017 through August 2017 period were up 3.2 percent (±0.7 percent) from the same period a year ago. The June 2017 to July 2017 percent change was revised from up 0.6 percent (±0.5 percent) to up 0.3 percent (±0.1 percent). Retail trade sales were down 0.3 percent (±0.5 percent)* from July 2017, and up 3.3 percent (±0.7 percent) from last year. Nonstore Retailers were up 8.4 percent (±1.6 percent) from August 2016, while Building Materials and Garden Equipment and Supplies Dealers were up 7.5 percent (±1.9 percent) from last year.[view full report] The chart below is a log-scale snapshot of retail sales since the early 1990s. The two exponential regressions through the data help us to evaluate the long-term trend of this key economic indicator.
Consumer Price Index: August Headline at 1.9% - The Bureau of Labor Statistics released the August Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 1.94%, up from 1.73% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 1.68%, down fractionally from the previous month's 1.69%. Here is the introduction from the BLS summary, which leads with the seasonally adjusted monthly data:The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in August on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 1.9 percent.Increases in the indexes for gasoline and shelter accounted for nearly all of the seasonally adjusted increase in the all items index. The energy index rose 2.8 percent in August as the gasoline index increased 6.3 percent. The shelter index rose 0.5 percent in August with the rent index up 0.4 percent. The food index rose slightly in August, with the index for food away from home increasing and the food at home index declining.The index for all items less food and energy rose 0.2 percent in August. Along with the shelter index, the indexes for motor vehicle insurance, medical care, and recreation all increased in August. The indexes for airline fares and for used cars and trucks were among those that declined in August. [More…]Investing.com was looking for a 0.3% increase MoM in seasonally adjusted Headline CPI and 0.2% in Core CPI. Year-over-year forecasts were 1.8% for Headline and 1.6% for Core. The first chart is an overlay of Headline CPI and Core CPI (the latter excludes Food and Energy) since the turn of the century. The highlighted two percent level is the Federal Reserve's Core inflation target for the CPI's cousin index, the BEA's Personal Consumption Expenditures (PCE) price index.
August Consumer Prices Surge As Shelter Costs Spike Most Since 2005 -- After disappointing (for The Fed's inflationistas) producer prices growth yesterday,consumer prices jumped 0.4% MoM in August - the biggest spike since January. Gains were driven by soaring energy costs (offset by a big decline in vehicle prices). Year over Year, CPI remains below The Fed's mandat at +1.9% but that is hotter than expected and the highest since April.. As the breakdown shows, the gains were largely driven by rising energy and shelter costs (and note that vehicle prices are tumbling). The motor vehicle insurance index continued to rise, increasing 1.0 percent in August. The recreation index also increased in August, rising 0.2 percent. The medical care index rose 0.1 percent in August. The index for physicians' services advanced 0.4 percent, and the hospital services index increased 0.2 percent. The apparel index rose 0.1 percent in August, as did the indexes for alcoholic beverages and for household furnishings and operations. The index for new vehicles was unchanged in August after declining in July. The index for airline fares, which rose 0.7 percent in July, fell 1.0 percent in August. The index for used cars and trucks continued to decline, falling 0.2 percent. The indexes for tobacco, for education, for wireless telephone services, and for personal care all declined 0.1 percent over the month. And in core inflation, the shelter index was the main contributor to the rise, increasing 0.5 percent, its largest increase since October 2005. The rent index increased 0.4 percent, and the index for owners' equivalent rent rose 0.3 percent. The index for lodging away from home rose sharply, increasing 4.4 percent after decreasing 4.2 percent in July.
August Producer Price Index: Final Demand Up 0.2% MoM - Today's release of the August Producer Price Index (PPI) for Final Demand came in at 0.2% month-over-month seasonally adjusted, up from last month's -0.1%. It is at 2.4% year-over-year, up from 1.9% last month, on a non-seasonally adjusted basis. Core Final Demand (less food and energy) came in at 0.1% MoM, up from -0.1% the previous month and is up 2.0% YoY. Investing.com MoM consensus forecasts were for 0.3% headline and 0.2% core. Here is the summary of the news release on Final Demand:The Producer Price Index for final demand advanced 0.2 percent in August, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices edged down 0.1 percent in July and moved up 0.1 percent in June. (See table A.) On an unadjusted basis, the final demand index increased 2.4 percent for the 12 months ended in August.Three-quarters of the August increase in final demand prices is attributable to the index for final demand goods, which climbed 0.5 percent. Prices for final demand services inched up 0.1 percent.The index for final demand less foods, energy, and trade services increased 0.2 percent in August following no change in July. For the 12 months ended in August, prices for final demand less foods, energy, and trade services rose 1.9 percent. More… . Since our focus is on longer-term trends, we continue to track the legacy Producer Price Index for Finished Goods, which the BLS also includes in their monthly updates. As this overlay illustrates, the Final Demand and Finished Goods indexes are highly correlated.
US Producer Price Index up 0.2% in Aug, vs 0.3% increase expected - U.S. producer prices rebounded in August, driven by a surge in the cost of gasoline, and there were also signs of a pickup in underlying producer inflation. The Labor Department said on Wednesday its producer price index for final demand increased 0.2 percent last month after slipping 0.1 percent in July. In the 12 months through August, the PPI rose 2.4 percent after advancing 1.9 percent in July. Economists said the uptick in producer prices was unlikely to assuage Federal Reserve policymakers' concerns about low inflation as the increase was largely due to a 9.5 percent increase in the cost of gas. That was the largest rise since January and followed a 1.4 percent decline in July. Though gas prices could rise further in September in the wake of Hurricane Harvey, which disrupted oil refinery production in Texas, a reversal was expected because of ample crude supplies. "Energy price gains, which will likely dominate the September inflation reports in the aftermath of Hurricanes Harvey and Irma, will likely be viewed as having a temporary impact on inflation by the Fed," Economists had forecast the PPI gaining 0.3 percent last month and accelerating 2.5 percent from a year ago.A key gauge of underlying producer price pressures that excludes food, energy and trade services rose 0.2 percent last month after being unchanged in July. The so-called core PPI increased 1.9 percent in the 12 months through August after a similar gain in July.Prices of U.S. Treasurys were trading lower, while the dollar rose against a basket of currencies. U.S. stock indexes were little changed after hitting record highs on Tuesday.
August Producer Price Rise Disappoints, Despite Gasoline, Consumer Loan Cost Surge Despite significant acceleration year-over-year - thanks to a 9.5% surge in gasoline costs -producer price appreciation in August disappointed expectations. PPI Final Demand YoY accelerated from 1.9% to 2.4% (but fell below the 2.5% expectation), rising only 0.2% MoM. The corest of the core PPI remained below The Fed's mandated inflation target for the second straight month... But headline PPI jumped to 2.4% YoY... perhaps putting more pressure on The Fed... Prices for final demand goods advanced 0.5 percent in August, the largest rise since moving up 0.5 percent in April. Most of the August increase can be traced to the index for final demand energy, which climbed 3.3 percent. Prices for final demand goods less foods and energy moved up 0.2 percent. In contrast, the index for final demand foods fell 1.3 percent. Three-quarters of the August increase in the final demand goods index can be traced to prices for gasoline, which jumped 9.5 percent . Over half of the August increase in the index for final demand services can be attributed to prices for consumer loans (partial), which advanced 1.7 percent This is the highest level of consumer loan price index since Nov 2015...
LA area Port Traffic: Imports increased, Exports decreased in August -- Container traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic.The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container).
To remove the strong seasonal component for inbound traffic, the first graph shows the rolling 12 month average.
Industrial Production Decreased 0.9% in August - From the Fed: Industrial production and Capacity Utilization Industrial production declined 0.9 percent in August following six consecutive monthly gains. Hurricane Harvey, which hit the Gulf Coast of Texas in late August, is estimated to have reduced the rate of change in total output by roughly 3/4 percentage point. The index for manufacturing decreased 0.3 percent; storm-related effects appear to have reduced the rate of change in factory output in August about 3/4 percentage point. The manufacturing industries with the largest estimated storm-related effects were petroleum refining, organic chemicals, and plastics materials and resins.
The output of mining fell 0.8 percent in August, as Hurricane Harvey temporarily curtailed drilling, servicing, and extraction activity for oil and natural gas. The output of utilities dropped 5.5 percent, as unseasonably mild temperatures, particularly on the East Coast, reduced the demand for air conditioning. At 104.7 percent of its 2012 average, total industrial production in August was 1.5 percent above its year-earlier level. Capacity utilization for the industrial sector decreased 0.8 percentage point in August to 76.1 percent, a rate that is 3.8 percentage points below its long-run (1972–2016) average. This graph shows Capacity Utilization. This series is up 9.4 percentage points from the record low set in June 2009 (the series starts in 1967). Capacity utilization at 76.1% is 3.8% below the average from 1972 to 2015 and below the pre-recession level of 80.8% in December 2007. The second graph shows industrial production since 1967. Industrial production decreased in August to 104.7. This is 20.2% above the recession low, and close to the pre-recession peak. The decrease was below expectations, largely due to Hurricane Harvey.
August Industrial Production Crashes Most Since May 2009 - Harvey Scapegoated -- Amid a collapse in US auto sales (and slumping retail sales), August Industrial Production collapsed 0.9% MoM. This is the biggest monthly drop since May 2009! Industrial production declined 0.9 percent in August following six consecutive monthly gains. Hurricane Harvey, which hit the Gulf Coast of Texas in late August, is estimated to have reduced the rate of change in total output by roughly 3/4 percentage point. The index for manufacturing decreased 0.3 percent; storm-related effects appear to have reduced the rate of change in factory output in August about 3/4 percentage point. Industries with the largest storm-related effects were petroleum refining, organic chemicals, and plastics materials and resins...Just wait for the v-shaped recovery from this (or not). And finally, while Industrial Production remains 1% below its Nov 2014 highs (and unchanged from its Nov 2007 highs), The Dow Jones Industrials Average is up 30% from the Nov 2014 levels (and 57% from 2007 highs).
Empire State Manufacturing Survey: Activity Down Slightly in September, Continued Growth - This morning we got the latest Empire State Manufacturing Survey. The diffusion index for General Business Conditions at 24.4 was a decrease of 0.8 from the previous month's 25.2. The Investing.com forecast was for a reading of 19.0.The Empire State Manufacturing Index rates the relative level of general business conditions in New York state. A level above 0.0 indicates improving conditions, below indicates worsening conditions. The reading is compiled from a survey of about 200 manufacturers in New York state. Here is the opening paragraph from the report.Business activity continued to grow strongly in New York State, according to firms responding to the September 2017 Empire State Manufacturing Survey. The headline general business conditions index held steady at 24.4. The new orders index rose four points to 24.9 and the shipments index climbed four points to 16.2, pointing to ongoing solid gains in orders and shipments. Unfilled orders increased, and delivery times continued to lengthen. Labor market indicators pointed to a modest increase in employment and hours worked. Both input prices and selling prices rose at a faster pace than last month. Indexes assessing the six-month outlook suggested that firms remained optimistic about future conditions. [source] Here is a chart of the current conditions and its 3-month moving average, which helps clarify the trend for this extremely volatile indicator:
Weekly Unemployment Claims: Down 14K, Affected by Hurricanes - Here is the opening statement from the Department of Labor: In the week ending September 9, the advance figure for seasonally adjusted initial claims was 284,000, a decrease of 14,000 from the previous week's unrevised level of 298,000. The 4-week moving average was 263,250, an increase of 13,000 from the previous week's unrevised average of 250,250. This is the highest level for this average since August 13, 2016 when it was 263,250. Hurricane Harvey and Irma impacted this week's initial claims. [See full report] Today's seasonally adjusted 284K new claims, down 14K from last week's 298K, was better than the Investing.com forecast of 300K. Here is a close look at the data over the past few years (with a callout for the past year), which gives a clearer sense of the overall trend in relation to the last recession.
Hurricane adjusted initial claims for week of Sept. 2: 239,000 --In 2012 I created an adjustment of what the initial jobless claims would have been, but for the hurricane.by backing out the affected states (NY and NJ) from the non-seasonally adjusted data. That gave me the number of initial claims filed in the other 48 states. I compared that with the same metric one year earlier, and multiplied by the seasonal adjustment. What that does is give me the number if the affected states had the same relative number of claims during the given week, as all of the unaffected states. In 2012, it showed that Sandy was not masking any underlying weakness in the economy. The state by state data is released with a one week delay. So what follows is the analysis for the week of September 2, the number for which was reported one week ago. This week I only had to back out Texas. Next week I will undoubtedly have to back out Florida as well. Here is the table for the Week of September 3 in 2016 vs. September 2 this year: If we use the 2016 weekly seasonal adjustment of 1.18% for the adjusted 201,405 total, this gives us ~238,000.If we use the 2017 weekly seasonal adjustment of 1.19% for the adjusted 201,405 total, this gives us ~240,000.Thus the hurricane-adjusted initial jobless claims number for the week of September 2, 2017 is 239,000. The underlying national trend in initial jobless claims remains very positive.
BLS: Job Openings Increased Slightly in July -- From the BLS: Job Openings and Labor Turnover Summary The number of job openings was little changed at 6.2 million on the last business day of July, the U.S. Bureau of Labor Statistics reported today. Over the month, hires and separations were also little changed at 5.5 million and 5.3 million, respectively. Within separations, the quits rate and the layoffs and discharges rate were little changed at 2.2 percent and 1.2 percent, respectively. ... The number of quits was little changed at 3.2 million in July. The quits rate was 2.2 percent. The number of quits was little changed for total private and for government. Quits decreased in educational services (-16,000). The number of quits was little changed in all four regions. The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS. The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. Note that hires (dark blue) and total separations (red and light blue columns stacked) are pretty close each month. This is a measure of labor market turnover. When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs. Jobs openings increased in July to 6.170 million from 6.116 in June. This is the highest number of job openings since this series started in December 2000. The number of job openings (yellow) are up 3% year-over-year. Quits are up 4% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for "quits"). Job openings are mostly moving sideways at a high level, and quits are increasing. This is another strong report.
US Job Openings Soar To New All Time High -- After nearly two years of being rangebound between 5.5 and 6 million, the BLS's JOLTS report - Janet Yellen's favorite labor market indicator- showed that the recent surge in job openings which was observed first last month, when job openings smashed expectations above 6 million for the first time ever, continued in July when the total number of job opening rose to a new record high of 6.170 million, an increase of 54k on the month, and well above the 6.0mm consensus forecast. The July job opening rate, or openings as a % of total employment plus openings, remained at a record high of 4. The number of job openings was little changed for total private and decreased for government (-58,000). Job openings increased in a number of industries with the largest increases occurring in other services (+111,000), transportation, warehousing, and utilities (+70,000), and educational services (+26,000). Job openings decreased in health care and social assistance (-72,000), state and local government, excluding education (-46,000), and federal government (-21,000).Now if only employers could find potential employees that can pass their drug test... Aside from the unexpected surge in job openings, the rest of the report was more subdued, with the pace of hiring reverseing last month's decline, and rising by 69,000 to 5.501 million...
More JOLTS hard data weakness in July -- (see graphs) I have been a dissenter about the JOLTS reports for over a year (although, perusing the intertoobs yesterday, it looks like a few more observers have joined the chorus). The typical commentator has focused on job openings (blue in the graph below), which have been trending higher strongly (as they did in yesterday's report for July): But openings are the one aspect of the report that are not "nard" data. They can just as easily be skewed by employers trolling for resumes, perhaps laying the groundwork for visas for cheap immigrant labor, or simply refusing to offer the wage or salary that would call forth enough actual applicants to hire. Hence the disconnect between "openings" and "hires," (red in the graph above), which have been barely above stagnant for the last year. Here is the YoY trend for hires: Thus I prefer to focus on the "hard" data series such as hires, quits, and layoff, where the story hasn't been nearly so strong. Let me start by comparing hires to total separations (averaged quarterly to cut down on noise): We only have one full business cycle to compare, but since the outset of the series at the start of the Millennium, the trend has been for hires to slightly lead separations. In the quarterly view, hires have been stagnant for going on 2 years. Here is the monthly view of the last few years: In the last three months, hires have picked up somewhat - although not to new hiighs, unlike separations, which *are* at new highs. Let's further compare historical hires with voluntary quits and also layoffs and discharges. Here we see that in the last cycle, hires stagnated, and shortly thereafter involuntary separations began to rise, even as quits continued to rise for a short period of time as well: Next, here is the current cycle, quarterly through June: Significantly, even while quits have continued to rise, involuntary separations bottomed a year ago, and have risen on a quarterly basis ever since. Here's the monthly view of the last several years: The recent surge in layofs and discharges is actually similar in scale to that just before the last recession. In short, just like the slowly decelerating YoY change in payrolls: JOLTS shows an employment situation that, while still positive, is slowly decaying.
BLS: Unemployment Rates Unchanged in 41 states in August, Tennessee at New Series Low -- From the BLS: Regional and State Employment and Unemployment Summary: Unemployment rates were higher in August in 8 states, lower in 1 state, and stable in 41 states and the District of Columbia, the U.S. Bureau of Labor Statistics reported today. Twenty-one states had jobless rate decreases from a year earlier, 1 state had an increase, and 28 states and the District had little or no change. The national unemployment rate, 4.4 percent, was little changed from July but was 0.5 percentage point lower than in August 2016. ... North Dakota and Colorado had the lowest unemployment rates in August, 2.3 percent and 2.4 percent, respectively. The rate in Tennessee (3.3 percent) set a new series low. (All state series begin in 1976.) Alaska had the highest jobless rate, 7.2 percent. This graph shows the current unemployment rate for each state (red), and the max during the recession (blue). All states are well below the maximum unemployment rate for the recession. The size of the blue bar indicates the amount of improvement. The yellow squares are the lowest unemployment rate per state since 1976. Eleven states have reached new all time lows since the end of the 2007 recession. These eleven states are: Arkansas, California, Colorado, Idaho, Maine, Mississippi, North Dakota, Oregon, Tennessee, Washington, and Wisconsin. The states are ranked by the highest current unemployment rate. Alaska, at 7.2%, had the highest state unemployment rate.The second graph shows the number of states (and D.C.) with unemployment rates at or above certain levels since January 2006. At the worst of the employment recession, there were 11 states with an unemployment rate at or above 11% (red). Currently one state has an unemployment rate at or above 7% (light blue); Only two states and D.C. are at or above 6% (dark blue). The states are Alaska (7.2%) and New Mexico (6.3%). D.C. is at 6.4%.
Corporate Contractors: The High End of the Precariat - Yves Smith - The Wall Street Journal’s in-depth story, The Life of a Contract Worker Is a Grind of Snubs, Anxiety and Stagnation, focuses on workers heretofore been largely ignored by the press, in part because they are not tracked in labor surveys. Think of these contractors, typically hired by large corporations via agencies, as long-ish term temps. An overview section: Millions of contractors now do heavy lifting, paper pushing and other jobs for American companies that have replaced employees with outside workers. Within the next four years, nearly half of the private-sector workforce in the U.S. will have spent at least some time as a contractor, temporary employee or other type of outside job, estimates MBO Partners, a provider of support services to self-employed professionals. The contractor model offers companies lower costs, more flexibility and fewer management headaches. Workers get far less from the arrangement. The costs hit home in every paycheck and every day on the job…Outside workers usually aren’t surprised when they get no paid holidays, sick days, employee-sponsored health insurance, 401(k) plan or other perks routinely offered to traditional employees at the same companies. What wounds more deeply are things taken for granted or barely considered at all by regular employees, outside workers often say. The work lives of contractors frequently feel like a series of tiny slights that reinforce their second-class status and bruise their self-worth. Even when contracting jobs are easy to get, they can vanish instantly, and turning a series of contract assignments into a real career remains out of reach… No one knows how many Americans work as contractors, because they don’t fit neatly into the job categories tracked by government agencies. Rough estimates by economists range from 3% to 14% of the nation’s workforce, or as many as 20 million people. The surge might help explain a riddle of today’s labor market—jobs are plentiful, but many Americans feel anxious and insecure about their finances and careers.
Low Rate of Unionization in US Consequence of Deregulation -- NEP’s Bill Black appears on The Real News Network and points out that former Treasury Secretary Lawrence Summers’ recent plea for greater unionization contradicts his actions as a member of the Clinton and Obama administrations, when he promoted financial deregulation, increasing the power of capital. You can view with transcript here.
Median household income hits $59,039, rising for 2nd straight year -- Americans notched solid financial gains in 2016 for a second straight year as household incomes rose, poverty fell and fewer people went without health insurance, signaling an end to the stagnation that had lingered since the Great Recession. The median U.S. household income climbed 3.2% to $59,039, the Census Bureau said Tuesday. That followed growth of 5.2% in 2015, the largest on records dating to 1968. The combined increase over the past two years is the biggest such rise since the 1960s. "Real median household income has finally completed its nine-year slog of digging out of the ditch," says IHS Markit economist Chris Christopher. The median, inflation-adjusted income of $59,000 last year surpassed the level in 1999 as the highest on record, but Census officials discouraged that comparison because the method for measuring income changed in 2014. The number of Americans living in poverty fell to 40.6 million from 43.1 million, lowering the poverty rate to 12.7% from 13.5% and placing it just marginally above the prerecession level.John Bouman, president of the Sargent Shriver National Center on Poverty Law, called the decline "welcome," but added, "Poverty remains a persistent problem in this country, afflicting tens of millions of people."The number of people without health insurance declined by 900,000 to 28.1 million. The share of Americans without coverage dipped to 8.8% from 9.1% the prior year. The report underscores that in the final two years of the Obama administration, low- and middle-income Americans made noticeable progress after struggling in the early years of the economic recovery. "Tuesday’s Census report comes as the president and congressional Republicans are advancing a cruel policy agenda that would decimate key anti-poverty programs, like federal food assistance and refundable tax credits," Bouman says. "If those proposals become law, they would undermine the quality of life and chances at upward mobility of millions of struggling Americans."
By the Numbers: Income and Poverty, 2016 - EPI --This fact sheet provides key numbers from today’s new Census reports, Income and Poverty in the United States: 2016 and The Supplemental Poverty Measure: 2016. Each section has headline statistics from the reports for 2016, as well as comparisons to the previous year, to 2007 (the final year of the economic expansion that preceded the Great Recession), and to 2000 (the historical high point for many of the statistics in these reports.) All dollar values are adjusted for inflation (2016 dollars). Median annual earnings for men working full time fell 0.4 percent, to $51,640, in 2016, although this change was not statistically significant. Men’s earnings are down 1.1 percent since 2007, and are still 0.6 percent lower than they were in 2000.Median annual earnings for women working full time rose 0.7 percent, to $41,554, in 2016—also statistically no different than women’s earnings in 2015. Women’s earnings are up 2.3 percent since 2007, and are 8.5 percent higher than they were in 2000. Median household income rose 3.2 percent, to $59,039, in 2016. Median household income is down 1.6 percent since 2007, and is still 2.3 percent lower than it was in 2000.Median non-elderly household income rose 3.6 percent, to $66,487, in 2016. Median non-elderly household income is down 1.5 percent since 2007, and is still 4.9 percent lower than it was in 2000. Median household income for white, non-Hispanic households rose 2.0 percent, to $65,041, in 2016. Median household income is still down 0.8 percent since 2007, and is still 0.9 percent lower than it was in 2000.Median household income for African American households rose 5.7 percent, to $39,490, in 2016. Median household income is down 2.5 percent since 2007, and is still 7.5 percent lower than it was in 2000. Median household income for Hispanic households rose 4.3 percent, to $47,675, in 2016. Median household income is up 3.2 percent since 2007, and is 0.1 percent lower than it was in 2000.The poverty rate fell 0.8 percentage points, to 12.7 percent, in 2016. The poverty rate is 0.2 percentage points higher than in 2007, although this difference is not statistically significant. The poverty rate is still 1.4 percentage points higher than it was in 2000.The child poverty rate fell 1.7 percentage points, to 18.0 percent, in 2016. The child poverty rate was the same in 2016 as it was in 2007, although it is still 1.8 percentage points higher than it was in 2000. The white, non-Hispanic poverty rate fell 0.3 percentage points, to 8.8 percent, in 2016. The white, non-Hispanic poverty rate is 0.6 percentage points higher than in 2007, and is 1.4 percentage points higher than it was in 2000.The African American poverty rate fell 2.1 percentage points, to 22.0 percent, in 2016. The African American poverty rate is 2.5 percentage points lower than in 2007, and is now 0.5 percentage points lower than it was in 2000. The Hispanic poverty rate fell 2.0 percentage points, to 19.4 percent, in 2016. The Hispanic poverty rate is 2.1 percentage points lower than in 2007, and is 2.1 percentage points lower than it was in 2000.
Poverty declined modestly in 2016; government programs continued to keep tens of millions out of poverty -- From 2015 to 2016, the official poverty rate fell by 0.8 percentage points, as household income rose modestly, albeit unevenly, throughout the income distribution. This was the second year in a row that poverty declined, and at 12.7 percent, the official poverty rate in 2016 was statistically the same as it was in 2007, just prior to the Great Recession. The poverty rate remains significantly higher than the low point of 11.3 percent it reached in 2000. Since 2010, the U.S. Census Bureau has also released an alternative to the official poverty measure known as the Supplemental Poverty Measure (SPM).1 The SPM corrects many potential deficiencies in the official rate. For one, it constructs a more realistic threshold for incomes families need to live free of poverty, and adjusts that threshold for regional price differences. For another, it includes as income many resources available to poor families, such as Medicare, food stamps, and other in-kind government benefits.
Today’s Census data on poverty, income, and heath insurance. - Jared Bernstein - A solid report, showing gains across the spectrum. But inequality’s up too, and median earnings, not so much… My data dive in the WaPo underscores the clearly favorable results in the report, but here are a few other factoids to consider: While this isn’t the best data for inequality analysis, for reasons I note in the WaPo, my piece points out the relative difference between gains at the 10th and 95th percentile. That observation is correct, but the 10th %’ile is a bit of a negative outlier. Better to look at a more stable statistic, the average real income gain for the bottom fifth, up 2.6% last year, compared to a 5.6% gain among the richest 5% of households. The bottom half gained last year, but not as much as the top. –It’s also true that incomes shares going to the middle and low income households are at all time lows, as the figure reveals. (See note in WaPo piece, however, re the impact of the 2013 survey change on comparisons like this. I think it’s a legit comparison, and it comports with other, better inequality data–where better means inclusive of more data sources, including taxes, more transfers, and capital gains–showing even more growth in inequality.) –The lack of change in real median earnings for full-time, full-year workers last year is worth noodling over a bit. It surely reflects a composition effect as lower-paid were drawn into the sample last year, pulling down the median (see here for how this works). But even considering that reality, look at this series for men since 1960: Sure, there’s composition effects embedded in there, but they don’t explain away the very long-term stagnation of the series. I mean the median full-time guy earns about the same in 2016 as in 1970!
Poverty declines in most states in 2016 -- EPI Blog - The American Community Survey (ACS) data released today shows that the decline in the national poverty rate was felt in nearly every state. The poverty rate decreased in 43 states and remained unchanged in three states. While there were slight increases in the poverty rate in four states and the District of Columbia, the only statistically significant increase occurred in Vermont. In only two states, Louisiana and Mississippi, was the poverty rate above 20 percent. Overall, the national poverty rate, as measured by the ACS, fell 0.7 percentage points, to 14.0 percent. Oregon saw the largest decline in its poverty rate (-2.1 percentage points), followed by Arkansas (-1.9 percentage points), Alabama (-1.4 percentage points), Hawaii (-1.3 percentage points), Montana (-1.3 percentage points), and South Carolina (-1.3 percentage points). There were increases in poverty in Vermont (1.7 percentage points), the District of Columbia (1.3 percentage points), Louisiana (0.6 percentage point), Oklahoma (0.2 percentage point), and Wyoming (0.2 percentage point). In Kentucky, Maryland, and West Virginia the rate remained essentially unchanged between 2015 and 2016. Income growth at the national level and an increase in the number of jobs pulling workers off the sidelines accounted for a drop in the poverty rate in many states. While the federal minimum wage sits at $7.25, many states and localities have increased their minimum wages, which helps lift workers out of poverty. At the same time, government programs including Social Security, refundable tax credits, and Supplemental Nutrition Assistance Program (SNAP) are directly responsible for keeping tens of millions out of poverty across the country. A significant drop in the poverty rate for the second year in a row is a positive sign, but lawmakers should be careful to protect these recent gains with policies that raise wages for working families.
Incomes continued to rise in 2016 in four out of five states - EPI Blog -- State income data from the American Community Survey (ACS), released today by the Census Bureau, showed that from 2015 to 2016, median household income rose moderately across the country, with all but 7 states and the District of Columbia posting gains in inflation-adjusted household income. The ACS report showed a 2.1 percent increase in inflation-adjusted median household income for the country as a whole—an increase of $1,157 in the annual income of a typical U.S. household. This is similar to, albeit slightly lower than, the 3.2 percent increase in household income that the Census Bureau’s reported earlier this week using data from the Current Population Survey (CPS). The ACS and CPS have different samples and cover a somewhat different timeframe, which can lead to slightly different estimates. In 2016, median household income ranged from $41,754 in Mississippi (17.5 percent below the median for the country) to $78,945 in Maryland (37.0 percent above the median for the country.) From 2015 to 2016, the largest percentage gains in household income occurred in Idaho, where the typical household experienced an increase of $2,922 in their annual income—an increase of 6.0 percent. Massachusetts (5.3 percent), Oregon (4.9 percent), North Carolina (4.4 percent), Arkansas (4.3 percent), and New Jersey (4.1 percent) all had increases of 4 percent or more. Twelve other states (Nevada, California, Utah, South Carolina, Washington, Georgia, Rhode Island, Alaska, Maryland, Arizona, Indiana, and Nebraska) experienced income growth that exceeded the national average. Median household income was essentially unchanged over the year, after adjusting for inflation, in 4 states (Hawaii, Oklahoma, Vermont, and Montana), and it declined in 5 states (New Hampshire, Delaware, North Dakota, Wyoming, and Louisiana) and the District of Columbia. The states with the largest percentage declines—North Dakota at 1.1 percent, Wyoming at 1.8 percent, and Louisiana at 2.5 percent—are all states whose economies are heavily dependent upon energy production. Thus, it is likely that these declines are the result of falling energy prices, which slowed economic growth in these states.
American Working Women Finally Earn 80 Cents on a Man's Dollar - American women earned more than 80 percent as much as their male counterparts for the first time last year. The median female worker with a full-time, year-round job made 80.5 cents for every man-earned dollar in 2016, Census Bureau data showed Tuesday. That’s up from 79.6 cents in 2015 -- marking the first time the share posted a statistically significant annual increase since 2007. Part of the gain for women has come as men lose ground. While the median female earned 2.3 percent more in 2016 than in 2007, men saw a 1.1 percent decline over that same period, in inflation-adjusted terms.
The Terrible Facts about Real Earnings of Men - Wolf Richter -On the surface, the data looks benign, with trends improving. And this is what you will see when you look at the media coverage of the Census Bureau’s Income and Poverty report (PDF) released today:
- Median household income, adjusted for inflation (via CPI), rose 3.2% between 2015 and 2016 to $59,039, the second year in a row of annual increases.
- For “family households,” the median income rose 2.7% to $75,062. For “nonfamily households,” it rose 4.5% to $35,761.
- The official poverty rate (weighted average threshold for a family of four = $24,563) inched down from last year to 12.7%, about the same as in 2007, before the Financial Crisis made a mess of people’s lives. In total, 40.6 million people live in poverty by this definition.
- The poverty rate for families fell to 9.8%, from 10.4% a year earlier, affecting 8.1 million families.
The survey is based on respondents at 98,000 addresses across the US — so a very large sample. Household income includes the amounts of money that the household received during that year from each of the following 18 sources: […] All these sources combined form household income in this survey. Adjusted for inflation via the Consumer Price Index for urban consumers (CPI-U), the median household income, at $59.039, has set a new record, beating the prior record set in 1999 ($58,665). This was the good news, with median household income finally a tad above where it had been 17 years ago: And that’s what the media focused on, this triumph of 17 years of stagnation, rather than decline. But buried in the data is a bitter reality for men: For women who were working full-time year-round, median earnings (income obtained only from working) rose 0.7% on an inflation-adjusted basis from a year ago to $48,328, continuing well-deserved increases over the data series going back to 1960. The female-to-male earnings ratio hit a new record of 80.5%, after steady increases, up from the 60%-range, where it had been between 1960 and 1982. And while that may still be inadequate, and while more progress needs to be made for women in the workforce, it was nevertheless the good news. Men in the workforce haven’t been so lucky. They have experienced the brunt of the wage repression over the past four decades, obtained in part via inflation, where wages inch up, but not quite enough to keep up with the Fed-engineered loss of purchasing power of the dollar. Median earnings for men who worked full-time year-round fell 0.4% in 2016, adjusted for inflation, to $51,640. On this inflation-adjusted basis, men had earned more than that in 1972 ($52,361). And it’s down 4.4% from the earnings peak in 1973 ($54,030). This translates into 44 years of real earnings decline:
Hackers could program sex robots to kill - A cybersecurity scientist has issued a bizarre warning that sex robots could one day rise up and kill their owners if hackers can get inside their heads.Last month, tech billionaire Elon Musk claimed that artificial intelligence could take over the planet, and he’s not the only one concerned about the dangers of killer tech.With sex robots becoming increasingly popular and sophisticated, cybersecurity lecturer Dr. Nick Patterson revealed that the lifelike dolls could end up going all “Terminator” on us.However, in the case of sex robots, the danger isn’t that the love dolls will end up developing minds of their own, “Westworld”-style. Instead, the risk is that hackers could breach the realistic robots’ inner defenses and catch their owners with their pants down.Patterson told Star Online that hacking into many modern-day robots, including sexbots, would be a piece of cake compared to more sophisticated gadgets like cellphones and computers.The tech expert, from Australia’s Deakin University, said: “Hackers can hack into a robot or a robotic device and have full control of the connections, arms, legs and other attached tools like knives or welding devices. “Once a robot is hacked, the hacker has full control and can issue instructions to the robot.”
The Resegregation of Jefferson County -- In 2013, a flier began making the rounds in Gardendale, Ala., a suburb of Birmingham. On it, a blond white girl wearing a red backpack and knee-high socks peered innocently at a question hanging above her head: “Which path will Gardendale choose?” Beside her was a list of communities in Jefferson County — Pleasant Grove, Center Point/Huffman, Adamsville/Forestdale, Hueytown — under the heading: “Places that chose NOT to form their own school system.” Below that was a list of four communities — Homewood, Hoover, Vestavia Hills, Trussville — that did form their own school systems and were “listed as some of the best places to live in the country.” To outsiders, these names are meaningless, but local residents knew exactly what was being said. In Jefferson County, like in any other racially mixed metropolitan area in the country, the names of towns and neighborhoods can serve as code, a way of referencing race without being explicit. Homewood, Hoover, Vestavia Hills and Trussville and their schools were heavily white. Center Point, Pleasant Grove and the others listed next to the girl all had large black populations — some had shifted from majority white to majority black. The flier was produced and sent out by a group of parents calling itself Focus (Future of Our Community Utilizing Schools) Gardendale. Focus was created in 2012 with a singular purpose: to split off Gardendale’s schools from the 36,000-student Jefferson County school district, where black students outnumber white ones. This process of breaking off is known as secession, and school secessions have become fairly common. Laws in 30 states explicitly allow communities to form their own public-school systems, and since 2000, at least 71 communities across the country, most of them white and wealthy, have sought to break away from their public-school districts to form smaller, more exclusive ones, according to a recent study released by EdBuild, a nonpartisan organization focused on improving the way states fund public education..
An Alabama high school 'resegregated' after years of being a model of integration — here's what happened after - In 2000, I graduated from Central High School in Tuscaloosa, Alabama. Central opened in 1979 after a federal court order forced the mostly segregated high schools in the Tuscaloosa City Schools system to integrate. For the next two decades, Central was an academic and athletic powerhouse in Alabama, producing state championships and National Merit Scholars.In 2000, the court order that created Central High School was lifted, and in August of that year — just months after I graduated — the Tuscaloosa City School Board voted to split Central into three high schools.To many, the move appeared to be a step backward in a state that had just begun to make progress after the civil-rights movement. Some saw the split as an act of resegregation, dividing the diverse student population that had once walked the halls together at the integrated Central High.Today, there are three high schools in the Tuscaloosa City Schools system. The most racially diverse is Northridge, which was built in the most affluent part of Tuscaloosa. Paul W. Bryant High School's student body is 86% African-American, according to the Alabama State Department of Education, and Central High School's is 98% African-American. Because of Central's low standardized-test scores, the department has designated it a "failing school" every year since 2013. I went back to Tuscaloosa to talk to former Central students about their experience, as well as students who experienced the split firsthand. I also spoke with former school board members, the current Tuscaloosa City Schools superintendent, and the current mayor of Tuscaloosa, who graduated from Central in 1991.
How U.S. News college rankings promote economic inequality on campus - Politico - America’s universities are getting two report cards this year. The first, from the Equality of Opportunity Project, brought the shocking revelation that many top universities, including Princeton and Yale, admit more students from the top 1 percent of earners than the bottom 60 percent combined. The second, from U.S. News and World Report, is due on Tuesday — with Princeton and Yale among the contenders for the top spot in the annual rankings.The two are related: A POLITICO review shows that the criteria used in the U.S. News rankings — a measure so closely followed in the academic world that some colleges have built them into strategic plans — create incentives for schools to favor wealthier students over less wealthy applicants. Those criteria often serve as unofficial guidelines for some colleges’ admission decisions and financial priorities, with a deeply ingrained assumption that the more a school spends — and the more elite its student body — the higher it climbs in the rankings. And that reinforces what many see as a dire situation in American higher education. “We are creating a permanent underclass in America based on education — something we’ve never had before,” said Brit Kirwan, former chancellor of the University of Maryland system. For instance, Southern Methodist University in Dallas conducted a billion-dollar fundraising drive devoted to many of the areas ranked by U.S. News, including spending more on faculty and recruiting students with higher SAT scores — and jumped in the rankings. Meanwhile, Georgia State University, which has become a national model for graduating more low- and moderate-income students, dropped 30 spots.
Are elite universities 'safe spaces'? Not if you're starting a union -- Over the next few weeks, our thought-leaders will scold this year’s class of overly sensitive Ivy League students, what with their safe spaces and trigger warnings. What, oh what is this generation coming to, they will cry. But while they weep, let us turn our attention to an entirely different aspect of life on the American campus that doesn’t fit into the tidy narrative of fancy colleges coddling the snowflake generation. Let us look instead into the actual conditions under which the work of higher education is done. Let us talk labor. In August 2016, the National Labor Relations Board (NLRB) in Washington decided that graduate students who teach classes at private universities can be considered employees of those universities, eligible to form unions and bargain collectively with their employers. It was the end point of a decades-long process in which the Board has oscillated between ruling in favor of grad student unions and then against them. In the aftermath of the NLRB decision, graduate student teachers at Columbia and Yale universities, both schools in the Ivy League, held elections and voted to form unions. More organizing elections are scheduled for the next few weeks at a number of other private universities, and as the school year gets under way grad students should rightfully be negotiating new contracts throughout the United States. But here’s the catch: thanks to the election of Donald Trump last November, the NLRB will soon be under the sway of his extremely anti-union Republican party. Once Trump’s members are seated on the Labor Board, there is every likelihood they will revisit the matter of graduate student teachers and reverse themselves on the question, which would in turn permit university administrations to refuse to negotiate and even to blow off the results of these elections. A radicalized university that lives to coddle young people would sit down immediately at the bargaining table and give those graduate students what they want. A corporation that is determined to keep its employees from organizing, on the other hand, would stall and delay and refuse to recognize the union until Trump’s new, right-wing NLRB can saddle up and ride to the rescue. And guess what: that is exactly what these universities are doing – refusing to begin contract negotiations, filing challenges to the elections, appealing this and that.
Senior House at MIT Dies, and a Crisis Blooms at Colleges -- Senior House was the gravitational center of alternative culture at MIT, characterized by extremes. For example, since 1963 its courtyard was the site for an annual Dionysian festival that began with a whole steer being hauled atop a pit and roasted on an open flame. The bacchanal ended three days later when there was no more mud left to wrestle in or drinks to gulp. By the time the third dawn came, friendships had been forged, tire swings had been swung, meat had been devoured, some drugs had probably been snorted or smoked, jobs had been offered, and lives had been changed. On campus, the reputation of Senior House preceded it. “When I became housemaster, the dormitory was functioning as a storm drain for the other MIT living groups,” wrote professor Jay Keyser of his time living in the house in the 1980s. “All the difficult students were funneled there.” Its motto was “Sport death, only life can kill you,” which sounds … scary. (The house symbol is a human skull.) Campus lore has it that Senior House residents used to burn kittens in the house furnace. There’s a rumor the first Steer Roast happened because a cow was brought upstairs, and when the students couldn’t get it back down they slaughtered it, threw the meat into the courtyard, and roasted it. “Or there’s the one that students in Senior House carry towels with them because at any point in time if they want to have an orgy they can just throw it down and have sex on the towel,” MIT’s dismantling of Senior House is part of a nationwide trend on college campuses, a shift that places a premium on safety, orderliness, and minimal bad publicity above all. Experts trace the roots of this shift to the 1980s. Since then, college tuition has skyrocketed and with it the competition for students who can afford it. Parents footing the bill are paying a lot more attention. The world has become more litigious and more corporate. All of this has led to an atmosphere in which university administrations have little margin for error when it comes to student safety or even bad publicity. And in this risk-averse atmosphere, places like Senior House, Eclectic, and Ricketts are increasingly viewed as unacceptable liabilities. “I first noticed this paternalistic ethos when I was doing some lectures at Vanderbilt University,” says sociologist Frank Furedi of the University of Kent and author of the book What’s Happened to the University? “There were all these campaigns being organized across America against drinking beer,” he says. “And I remembered that when I was in college the whole point was to get drunk.”
Harvard withdraws fellowship invitation to Chelsea Manning (Reuters) - Harvard University on Friday withdrew a fellowship invitation to Chelsea Manning, the transgender U.S. Army soldier who was convicted of leaking classified data, after two leaders in the U.S. intelligence community distanced themselves from the school. Manning, 29, was released in May from a U.S. military prison in Kansas where she had been held for passing secrets to the WikiLeaks website in the biggest breach of classified data in the history of the United States. The Harvard Kennedy School of government announced on Wednesday that it had invited the controversial figure to be a visiting fellow and speak at a forum. The invitation to speak still stands, Harvard Kennedy Dean Douglas Elmendorf said in a statement. “I now think that designating Chelsea Manning as a visiting fellow was a mistake, for which I accept responsibility,” Elmendorf said. “I see more clearly now that many people view a visiting fellow title as an honorific, so we should weigh that consideration when offering invitations.”
Trump’s Education Department delays student loan forgiveness - Tens of thousands of former students who say they were swindled by for-profit colleges are being left in limbo as the Trump administration delays action on requests for loan forgiveness, according to court documents obtained by The Associated Press. The Education Department is sitting on more than 65,000 unapproved claims as it rewrites Obama-era rules that sought to better protect students. The rewrite had been sought by the industry. The for-profit colleges have found allies in the new administration and President Donald Trump, who earlier this year paid $25 million to settle charges his Trump University misled customers. And it's yet another example of the administration hiring officials to oversee the industries where they had worked previously. In August, Education Secretary Betsy DeVos picked Julian Schmoke Jr., a former associate dean at DeVry University, as head of the department's enforcement unit. She also has tapped a top aide to Florida's attorney general who was involved in the decision not to pursue legal action against Trump University to serve as the agency's top lawyer. More than 2,000 requests for loan forgiveness are pending from DeVry students. The Obama rules would have forbidden schools from forcing students to sign agreements that waived their right to sue. Defrauded students would have had a quicker path to get their loans erased, and schools, not taxpayers, could have been held responsible for the costs. Now, in a filing in federal court in California, acting Undersecretary James Manning says the department will need up to six months to decide the case of a former student at the now-defunct Corinthian Colleges and other cases like hers. Sarah Dieffenbacher, a single mother of four from California, had taken out $50,000 in student loans to study to become a paralegal, but then couldn't find a job in the field, defaulted on her debt and could face wage garnishment.
CFPB Deal Could Mean Relief From Wall Street’s Worst Student Loans - Hundreds of thousands of Americans in debt from the worst batch of student loans Wall Street ever bundled could see their balances cut under a tentative agreement the feds have struck with a little-known firm that effectively owns more than $8 billion in securitized student debt. The tentative deal, which has not yet been finalized, would resolve a years-long investigation by the Consumer Financial Protection Bureau into consumer lawyers’ allegations that debt collectors for the 15 trusts that hold that debt have flooded courts with sloppy lawsuits against tens of thousands of borrowers accused of having defaulted. Those trusts, the National Collegiate Student Loan Trusts, are collectively one of the nation’s largest owners of private student debt. Their preliminary settlement with the CFPB was reached by their ultimate owner, VCG Securities LLC, a Florida-based investment firm led by Donald Uderitz. If finalized, it would require the payment of “large sums” in restitution to borrowers and civil penalties to the U.S. government, according to a summary of the proposal filed in a separate court case. The trusts, created more than a decade ago, cumulatively have held well over 874,000 loans made to more than 812,000 people who borrowed money from banks mostly to pay for their higher education, according to filings with the U.S. Securities and Exchange Commission and monthly reports to investors. Those banks sold the loans to a middleman who created the trusts, and the trusts then sold notes promising certain returns to investors ranging from the hedge-fund manager Waterfall Asset Management LLC to the Bill & Melinda Gates Foundation. Monthly payments to investors are backed by borrowers’ monthly payments on their student loans. The loans, made by banks such as JPMorgan Chase & Co. and Bank of America Corp., largely went to borrowers with good credit scores, and more than 80 percent of them were co-signed by someone else, like a parent, securities filings show. But many of them came due in the aftermath of the 2007-09 financial crisis, and borrowers ended up defaulting at record rates.
CalPERS Runs Unconstitutional, Tamper-Friendly Election With Non-Secret Ballots - Yves Smith - CalPERS has yet again confirmed its preference for cronyism and convenience over good governance. It changed its election procedures in 2016, resulting in a process that violates both the California constitution and specific election statutes. It is already troubling that CalPERS, a state agency, also administers the elections for its board members. Unlike state and local governments, where elections are a major element in their activities, elections are an afterthought for CalPERS, and it shows.Last year, CalPERS changed ballot procedures, turning a formerly secret voting process into one that makes how participants voted visible. As we will describe, it also may be possible for the vote-counting process to be exploited to the advantage of incumbents and organizations like unions that have the resources to get out votes.Even worse, in this election, CalPERS has also implemented voting by Internet, which is explicitly against the law in California. Elections for two board seats, with the winners serving as officials of the State of California, are now underway and will conclude on October 2. CalPERS changed the procedures for this election that effectively ended secret voting for ballots sent by mail, which is how the overwhelming majority of responses will be filed. This has reduced the process to standards below those of countries like Syria that the US regularly criticizes as being undemocratic. This outcome is contrary to the California Constitution. Section 7 of Article II flatly states: “Voting shall be secret.”
Congress’s Blitzkrieg on our Retirement Saving – Isola - Congress is about to declare war on the average American struggling to save for retirement.The ineptitude of Congress has no limits. Just when you thought they have reached maximum density regarding incompetence and stupidity, think again.For those who have not been paying attention, here are some of the issues Americans are facing regarding their retirement:
- Only 13% of employees are covered by both a 401(k) and a pension.
- Fewer than 10% of workers get a 5% dollar-for-dollar employer match in their plans.
- Retirement savers are overcharged to the tune of $17 billion, annually, by financial salespeople.
- 47% of Americans aged 55-64 have ZERO saved in retirement accounts.
- The 53% of Americans with retirement account savings have a median balance of just $100,000.
- 42% of Millennials have no retirement savings.
- More than 50% of Gen X-ers have less than $10k saved.
Congress’s Solution: A proposal to take away the tax benefits of retirement plans like 401(k)s and 403(b)s. In other words, they want to create a disincentive to remedy our citizens’ anemic retirement savings rate. Their reason for this insane proposal: To help finance a massive tax cut, proposed by President Trump and created by Goldman Sach’s Washington Vampire Squid subsidiary. Tax-deferred contributions have been deemed to be easy-pickings to fund their schemes.
Early Look at 2018 Cost-Of-Living Adjustments and Maximum Contribution Base - The BLS reported this morning:The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 1.9 percent over the last 12 months to an index level of 239.448 (1982-84=100). For the month, the index increased 0.3 percent prior to seasonal adjustment.CPI-W is the index that is used to calculate the Cost-Of-Living Adjustments (COLA). The calculation dates have changed over time (see Cost-of-Living Adjustments), but the current calculation uses the average CPI-W for the three months in Q3 (July, August, September) and compares to the average for the highest previous average of Q3 months. Note: this is not the headline CPI-U, and is not seasonally adjusted (NSA). In 2016, the Q3 average of CPI-W was 235.057. The 2016 Q3 average was the highest Q3 average, so we only have to compare Q3 this year to last year. (Sometimes we have to look back two years). For July and August 2017, the average is 239.0325 - or a 1.7% increase over the Q3 average last year. Inflation probably picked up a little in September due to the increase in gasoline prices following Hurricane Harvey, so COLA will probably be close to 2%.
Who Is Behind FDA-Weakening Bill Based on False Premise That It Restricts Access to Experimental Drugs for the Terminally Ill? - by Yves Smith -- Trudy Lieberman has an important post on a story that has gone below the media radar, on how a bill based on the bogus premise that the FDA is impeding terminal patients’ ability to get access to experimental drugs, is moving forward in Congress and garnering unwarranted favorable commentary. Here is her overview: Right before Congress adjourned for the August recess, the Senate rushed through “right to try” legislation that its sponsor Sen. Ron Johnson of Wisconsin argued gives terminally ill patients the “right to access treatments that have demonstrated a level of safety and could potentially save their lives.” …But the legislation, on its way to possibly an early vote in the House of Representatives in the next few weeks, eliminates the FDA in the process and with it any protections patients might have. This might sound fine and logical if you don’t know the fact. The FDA already has a process for approving the experimental drugs for the terminally ill. The process is fast, with emergency sign-offs in 24 hours and the rest processed in 3-4 days. 99% of the applications are approved. So the idea that this is a problem is simply not true. In addition, the FDA also provides useful input in these cases: On top of that, there are downsides to patients who go outside the FDA approved process: …few patients in the 37 states that have adopted such laws are likely to know they may lose hospice coverage or they may be denied coverage for home health care if they are using an experimental drug. In Colorado, Connecticut, Oklahoma, and West Virginia, patients may lose their health insurance. Their coverage may be denied for six months after the experimental approach ends. What interests me as least as much as Lieberman’s story is who might be behind this campaign to curb the FDA’s role. And it isn’t Big Pharma. . An organization called Goldwater Institute, “a libertarian think tank,” is the leader of the campaign for this bill and similar legislation passed in 37 states….
CDC official sends troubling message to employees about media questions - AN OFFICIAL WITH THE CENTERS FOR Disease Control and Prevention has instructed employees not to speak directly with members of the press, Axios’ Sam Baker reported yesterday. Several health journalists quickly condemned the CDC move, calling it “really disturbing” and a “gag order,” among other critiques: The CDC is a public health institution, not a political one. Come on. https://t.co/MwAq2lnXWW Axios published text from a late August email by a CDC public affairs officer that directs staff to route any correspondence with journalists—“everything from formal interview requests to the most basic of data requests”—through the communication office at its Atlanta headquarters:“The message—sent by public affairs officer Jeffrey Lancashire and dated Aug. 31—instructs all CDC employees not to speak to reporters, ‘even for a simple data-related question’… Lancashire did not respond to requests for comment about the policy. But I’d love to know what harm was being done by CDC employees answering ‘the most basic of data requests.’” David Nather, Axios’ managing editor, received notice of the communications change from a concerned CDC employee. “It does seem like a break from past practices at CDC,” Nather tells CJR. “We’re usually coming to them for routine data requests—not comment on administration policies.”
These Are America's Fattest States - According to a new report, one third of U.S. adults are obese along with one in six children. The research was conducted by the Trust for America's Health and the Robert Wood Johnson Foundation and, as Statista's Nial McCarthy explains, it found that the adult obesity rate exceeded 35 percent in five states, 30 percent in 25 states and 25 percent in 46 states.In 2016, West Virginia had the highest rate of obesity at 37.7 percent, followed closely by Mississippi with 37.3 percent. Alabama and Arkansas jointly round off the top three with 35.7 percent each. Back in 2000, no U.S. state had an obesity rate higher than 25 percent.As bad as the obesity epidemic is, the report also found that rates are starting to stabilize and actually decline in some places. Colorado, Minnesota, Washington and West Virginia all saw their obesity rates climb while Kansas saw a decrease.The situation remained stable everywhere else.Progress in halting the spread of expanding waistlines can be attributed to state policies improving access to healthy food and increasing physical activity. The report notes that early childhood education has proven particularly effective at preventing obesity in early life, instead of having to reverse the problem in later years.
Here Are The California Counties Where Annual Opioid Scripts Outnumber People ---The California Department of Public Health just dropped some staggering statistics about the level of opioid abuse in America's progressive paradise of the left coast. As theSacramento Bee points out, there are a remarkable number of counties in California where annual prescriptions for pain killers actually exceed the population. Trinity County is the state’s fourth-smallest, and ended last year with an estimated population of 13,628 people.Its residents also filled prescriptions for oxycodone, hydrocodone and other opioids 18,439 times, the highest per capita rate in California.Besides Trinity, other counties with more prescriptions than people include Lake, Shasta, Tuolumne and Del Norte counties. In the Sacramento region, El Dorado, Placer and Sacramento counties had prescription rates above the statewide average, with Yolo County slightly below the state average. A county’s prescription total represents all opioids dispensed via prescriptions filled at a pharmacy and tracked by the state. Statewide, 15 percent of Californians were prescribed opioids in 2016, ranging from 7.3 percent of residents in tiny Alpine County to almost 27 percent in Lake County. As might be expected, the scripts per capita are highest in California's more rural northern counties.
“We started it”: Atul Gawande on doctors’ role in the opioid epidemic -- Earlier this week I had the chance to interview author and surgeon Atul Gawande. Our conversation ranged from end-of-life care to his failed rock band — but what stuck with me most was our discussion of the opioid epidemic.I asked Gawande to weigh in on a question I hadn’t seen him discuss elsewhere: What role did doctors and professional medicine play in the proliferation of opioids? “We started it,” Gawande told me flatly. He argued that health providers are at the root of the country’s staggering opioid epidemic. He didn’t blame the pharmaceutical companies — although there is good evidence that they played a large role — but instead focused on how views of pain began to shift in the 1990s, with doctors urged to take their patients’ suffering more seriously. I wrote about this movement a few months ago in a feature for Vox. Gawande went through his medical training in the mid-1990s, at a moment when pain was being dubbed “the fifth vital sign” and pain scales were becoming a standard feature of any doctor office. Gawande said that changed how he practiced medicine. “I really keyed into the lessons from people like palliative care clinicians who said we have to measure pain, and we have to treat pain,” Gawande says. “But what we had not done was continue to measure what was happening along the way. I had no idea. Basically, I was like more is better, take some.” Here’s the full exchange:
Tenting the Homeless and Bleaching the Streets: How San Diego Is Fighting a Hepatitis Outbreak Hundreds of homeless people living on the street will find shelter in three large industrial tents with beds, showers, restrooms and hand-washing stations by the end of the year under a plan announced Wednesday by San Diego Mayor Kevin Faulconer."We are in a crisis that calls for action," Faulconer said in a morning news conference in a parking lot at 14th and Commercial streets downtown, one of the three tent sites. The tents can hold at least 100 people and up to 250. A second downtown tent operated by the Alpha Project is planned for a vacated street at 16th Street and Newton Avenue, and a third tent run by Veterans Village of San Diego is planned for the 2700 block of Sports Arena Boulevard, behind a Goodwill store.The two organizations previously had run winter shelter programs with similar tents at those sites for the site. Besides providing temporary shelter for hundreds of people sleeping in storefronts, canyons and on sidewalk encampments, Faulconer said the plan could help stem a hepatitis A outbreak that has left 16 people dead and hospitalized almost 300.
Tick escapes during Japanese press conference on deadly disease prevention -- The governor of a Japanese prefecture has apologized after a news conference to raise awareness of a tick-borne disease was interrupted when a live, and potentially lethal, tick disappeared. Miyazaki Governor Shunji Kono called the press conference in the name of public safety after several residents in the region were struck down with Thrombocytopenia syndrome (SFTS), an infectious disease that kills around 12 percent of those who contract it. One live and one dead tick were put on display at the press event. However, the conference descended into farce when the live creature, which had been in a transparent vial, escaped the clutches of a government official’s tweezers.“We should have been more careful about safety management as the prefecture is in a position to alert its people,” Kono told the media on Tuesday, according to the Japan Times.“On the part of the prefectural government that was trying to raise awareness, there was a need for more thorough safety control, and I apologize for the inadequacy,” he added. Photographers and journalists were enlisted to help find the runaway critter. Despite their best efforts, the group failed to recover the three-millimeter long tick, forcing them out of the room while the area was sprayed with pesticide.
Reports Show Genetically Modified Mosquitoes Ineffective and Risky --GeneWatch UK released an updated report on Oxitec’s releases of genetically modified (GM) mosquitoes in the Cayman Islands. The report cites new information regarding ineffectiveness and risks, including the annual report of the project, recently released as a result of a Freedom of Information request. The annual report was not available to the National Conservation Council (NCC) at its June 4th meeting, when it approved an island-wide roll-out of GM mosquito releases. The new information shows that the releases have been ineffective and large numbers of biting female GM mosquitoes have been released.“Plans to roll-out Oxitec’s GM mosquito releases island-wide must be halted whilst this new information is properly considered”, said Dr Helen Wallace, Director of GeneWatch UK, “Oxitec’s GM technology is failing in the field and poses unnecessary risks. Islanders’ money should not be thrown away on an approach which has not been successful.”The new information shows:
- Oxitec has struggled to suppress the wild population of mosquitoes with its GM releases, and has only had an effect in the dry season, when numbers are low, and when combined with spraying;
- Oxitec has been criticised for using egg traps to claim its GM mosquito releases have suppressed the local mosquito population, because egg traps do not measure the number of adult females which bite and cause disease. In the annual report, for the first time, adult female numbers are reported, which show that any suppression in adult female numbers is much delayed compared to what is measured by the egg traps, and is preceded by increases (spikes) in adult female numbers associated with the releases;
- Spikes in adult females which follow the GM releases might be caused by the inadvertent releases of GM females (although other explanations are also possible);
- Controversially, the project allowed up to 1,000 biting female GM mosquitoes to be released per week, but in practice up to 9,000 biting females were released per week due to a problem with sorting males and females;
- When the roll-out is scaled up, this could lead to up to 180,000 GM biting females being released per week if the sorting problem is not solved, or 20,000 GM biting females per week even if the sorting criterion is met.
There remains no evidence that the GM mosquito releases reduce the risk of transmission of dengue, zika or chikungunya.
The bees behind your morning coffee might be in big trouble - The best coffee grows in the mountains, where it is cool. The plants need low temperatures to thrive, which is why growers often put shade trees in their fields. But the mountains are getting hotter. And the higher you go, the less room there is to grow coffee. This is one reason scientists predict coffee will suffer in a changing climate.New research suggests the fate of coffee may be worse than previously thought. Earlier projections underestimated the effects of climate change, specifically in Latin America, and failed to consider the consequences for coffee-pollinating bees, according to the study, which appears in the Proceedings of the National Academy of Sciences.This is bad news, and not just for coffee lovers. It portends economic disaster for vulnerable farmers whose incomes depend on the crop. Most coffee growers in Latin America are small farmers whose food security relies on cash earned by selling coffee. In countries like Guatemala and Mexico, coffee is an important source of income for indigenous communities. “In all, probably 100 million people are involved in its production, most of them rural and poor. So there is more at stake here than the price of a nice espresso in New York or Paris.” The study, conducted with advanced computer modeling, spatial analysis and field data, predicts that climate change could reduce coffee-growing areas in Latin America — the world’s largest coffee-producing region — by as much as 88 percent by 2050, with the largest declines in Nicaragua, Honduras and Venezuela.
Hundreds of dead birds found on Bering Sea shores - Hundreds of dead seabirds have been found washed ashore on sites from islands in the Bering Sea to villages north of the Bering Strait, signs of another large die-off in the warmed-up waters of the North Pacific Ocean.The dead birds are mostly northern fulmars and short-tailed shearwaters, species that migrate long distances to spend summers in waters off Alaska and other northern regions, the U.S. Fish and Wildlife Service reported. Also in the mix are some kittiwakes, murres and auklets, the federal agency said. The cause is being investigated. Necropsies so far show that the birds are emaciated — with no food in their stomachs or intestines and little or no fat on their bodies."Right now, we know that they are starving to death and can't hold their heads above water, and they're drowning," said Ken Stenek, a teacher in Shishmaref and volunteer in a program that monitors seabirds.The precise toll is unclear. Fish and Wildlife said in its bulletin about 800 dead birds had been found since early August, but surveys are continuing and the known toll appears to be mounting — and experts caution that birds washing ashore represent only a small fraction of the dead. Of this latest wave, the first were found on the Pribilof Islands in the Bering, the Fish and Wildlife Service said. Since then, dead birds have washed ashore on Bering beaches and as far north as the Inupiat villages Shismaref and Deering on the Chukchi Sea mainland coastline.The new die-off follows a massive loss of common murres in 2015 and 2016, the biggest murre die-off on record in Alaska, and precursor to near-total reproductive failures for murres in the Gulf of Alaska and Bering. It also follows the deaths of hundred of puffins found last fall on St. Paul Island in the Pribilofs and, prior to that, mass deaths of murres and auklets along the U.S. West Coast. In each death wave, starving birds have left emaciated carcasses, and each wave has been associated with unusually warm marine waters.
Deforestation in Cambodia linked to ill health in children - Rapid deforestation in Cambodia is threatening the health of young children, concludes a new study published in the Lancet Planetary Health.Researchers have found that the loss of dense forest cover in Cambodia is associated with an increased risk of diarrhea, acute respiratory infection and fever in children younger than five years.“This is alarming as deforestation has become a contributor to key child mortality factors in Cambodia,” said co-author Roman Carrasco of the National University of Singapore (NUS). This study adds to the growing body of research which shows that clearing large swathes of forests can have serious consequences for human health. “It was surprising how clear the signal was — all the conditions we were studying that we hypothesized could have a relationship with deforestation (diarrhea, acute respiratory infection, fever) clearly increased after losing dense forests,” Carrasco said. The study did not explore how deforestation could be causing higher incidence of diarrhea and other diseases. But previous research has suggested that the loss of forest cover can disrupt the water cycle, changing both the water quality (by increasing the load of diarrhea-causing microbes in water) and water quantity (by reducing the amount of water available for personal hygiene). This can in turn cause diarrhea in downstream communities. The same could be true for Cambodia, the researchers say, especially since a large part of Cambodia’s rural households source their drinking water from unprotected wells, springs, and surface water, and many still don’t use appropriate water-treatment methods before drinking. Deforestation can also create conditions conducive for mosquitoes to breed in (such as a warmer environment), heightening the risk for mosquito-borne diseases and fever, the authors write.
Farmers Urge EPA & USDA to Address Threat from Dicamba Pesticide Drift - As members of Congress return to Capitol Hill, 85 farm and farmer support organizations sent letters to the U.S. Environmental Protection Agency (EPA) and U.S. Department of Agriculture (USDA) urging them to better protect farm families from an unprecedented spike in crop loss from herbicide drift. Experts estimate that dicamba, used on Monsanto’s latest seed line, has already damaged at least 3.1 million acres of farmland, an area the size of Connecticut. “EPA and USDA must stand up for farmers, their families and rural America. Drift from dicamba is a growing threat to our security and prosperity. Our leaders must act with urgency to take Monsanto’s seeds and pesticides off the market,” said Dena Hoff, a diversified Montana farmer and vice president of National Family Farm Coalition. According to state departments of agriculture, 2,200 soybean farmers in at least twenty states have already reported crop damage from dicamba drift this season — which scientists have linked to the introduction of Monsanto’s new dicamba-resistant seed line, “Roundup Ready 2 Xtend.” Fruit and vegetable growers neighboring dicamba-treated fields, as well as cotton and soybean growers planting non-resistant seeds, are particularly susceptible to crop damage or loss through dicamba drift. Organic farmers whose products have been contaminated by dicamba risk also losing their certification and markets. The letters sent to the agencies, and shared with congressional agriculture committees, specifically call on EPA to cancel its conditional registration of Monsanto’s new dicamba-based herbicide cocktail, Xtendimax, and call on USDA to cancel the registration of Monsanto’s Xtend line of dicamba-resistant soybean and cotton seeds. “Today’s dicamba drift problem cannot be solved by label restrictions or formulation modification,” farmers wrote in their letter to EPA. “Precisely because Xtendimax is intended to be used on Xtend seeds throughout the higher temperatures of the growing season, this product will continue to volatilize and drift.” Farmers warned the agencies that allowing either Xtendimax or Monsanto’s genetically engineered Xtend seeds to stay on the market essentially guarantees the spread of dicamba drift across the Midwest and South, threatening American farms, livelihoods, and human and environmental health.
European Glyphosate Safety Report Copy-Pasted Monsanto Study - Two years ago, the debate over glyphosate 's link to cancer took a surprising turn when the European Food Safety Authority's (EFSA) infamously rejected the World Health Organization's International Agency for Research on Cancer's March 2015 classification of the weedkiller as a possible carcinogen . However, new reporting from the Guardian reveals that the European agency's recommendation that the chemical is safe for public use was based on an EU report that directly lifted large sections of text from a study conducted by Monsanto , the manufacturer of glyphosate-based Roundup. The particular sections cover some of the biggest questions about glyphosate's supposed health risks, including its links to genotoxicity, carcinogenicity and reproductive toxicity. The revelation comes as the European Union debates whether it should extend its licensing of the world's most popular herbicide. As it happens, the EFSA provides scientific advice to the EU and plays a key role in the authorization of thousands of products that end up in Europe's food chain, including genetically modified organisms , pesticides, food additives and nanotech products, according to Corporate Europe Observatory, a non-profit watchdog group.The Guardian reports that dozens of pages from of the 4,300-page renewal assessment report (RAR) published in 2015 "are identical to passages in an application submitted by Monsanto on behalf of the Glyphosate Task Force (GTF), an industry body led by the company." Additionally, the paper includes a review copied from ex-Monsanto employee John Acquavella and company toxicologist Donna Farmer that "challenges the results of a study which found an association between pesticide use and non-Hodgkin lymphoma," the Guardian report states.
Red list: ash trees and antelopes on the brink of extinction - Native ash trees, abundant across North America, are on the brink of extinction as an invasive beetle ravages forests, according to the new red list of threatened species from the International Union for Conservation of Nature (IUCN).The list now includes more than 25,000 species at risk of extinction and the scientists warn that species, such as the American ashes and five African antelopes, that were thought to be safe, are now disappearing faster than they can be counted. The new red list declares the Christmas Island Pipistrelle bat extinct, but also reports that conservation efforts have improved the prospects for snow leopards and the Rodrigues flying fox from Mauritius.In July, scientists reported that a “biological annihilation” of wildlife in recent decades means a sixth mass extinction in Earth’s history is under way and is more severe than previously feared. Half of all animals on the planet have been lost in the past 40 years, due to the destruction of wild areas, hunting and pollution [including climate disruption] as the human population grows. “Our activities as humans are pushing species to the brink so fast that it’s impossible for conservationists to assess the declines in real time,” said Inger Andersen, IUCN director general. “Even those species that we thought were abundant and safe – such as antelopes in Africa or ash trees in the US – now face an imminent threat of extinction.” The six most common ash tree species in North America, representing nine billion trees, have entered the red list for the first time, with five assessed as being in the most at-risk category of critically endangered. They are being destroyed by the fast-spreading emerald ash borer beetle, which arrived in Michigan from Asia in the late 1990s in infested shipping pallets. The beetle has already killed tens of millions of trees and can wipe out a whole forest in six years. Climate change is also helping the alien invader enter new areas that were previously too cold. One of the affected species, the once-plentiful white ash is one of the most valuable timber trees in North America, used for making furniture, baseball bats and hockey sticks.
Endangered Species Act Protections in House Committee Crosshairs - One of our nation's core environmental safeguards is at risk of being hollowed out, as the House Natural Resources Committee takes up legislation Wednesday to weaken the Endangered Species Act. Starting at 11 a.m. ET, the committee is voting on five bills that aim to weaken a variety of protections offered by the flagship conservation law. A detailed description of each proposal is included in this letter of opposition. With this committee markup, the Endangered Species Act faces possible erosion in a variety of ways. For example, the law currently uses best-available science as the basis for protecting species under the act. Yet the proposed "Listing Reform Act" (H.R. 717) would subvert this foundational, science-based premise, enabling federal agencies to deny protections based on economic impacts. Similarly, the "Gray Wolf State Management Act" (H.R. 424) —dubbed the "War on Wolves Act" by opponents—seeks to override a unanimous DC Circuit Court of Appeals decision regarding gray wolves in Michigan, Minnesota and Wisconsin. Those upper Midwest wolf populations would be stripped of existing Endangered Species Act protections under this legislation. This bill would also codify a recent DC Circuit Court of Appeals ruling that stripped federal protections for wolves in Wyoming. It would also prohibit judicial review of both legislative wolf delistings, and thus sets a damaging trend for undermining all laws that allow citizens from across the political spectrum to go to court to hold the government accountable for its actions. Legislative threats to the Endangered Species Act have spurred widespread social media backlash. "These noxious attacks on imperiled wildlife violate the spirit of its enactment, which was to conserve irreplaceable, imperiled species and the ecosystems they depend on. With scientists now warning that we have entered a wave of mass extinctions, federal protections for imperiled plants and wildlife are needed more urgently than ever before. Politicians should be finding ways to strengthen the Endangered Species Act, not render it toothless."
Potlotek First Nation advised its water unfit for drinking or washing - A year after residents of Potlotek First Nation in Cape Breton rallied to protest the quality of their drinking water, the community has been advised by Health Canada not to drink the water, bathe in it or even wash clothes in it. On Monday, the band posted an email from Health Canada on its Facebook page saying the latest test results show that concentrations of manganese and iron in the drinking water exceed the "esthetic objectives" set out in Canada's guidelines for drinking water quality. Health Canada recommended the Nova Scotia band implement a drinking water advisory and said more detailed information would be available soon. In an email to CBC News, Health Canada said residents should not use the water for drinking, cooking, bathing, showering or doing laundry, but did not say there was any health risk involved in exposure to the water. "High levels of iron and manganese affect the quality of the water and contribute to water discoloration, foul odours and staining of plumbing fixtures," wrote spokesperson Maryse Durette. "Increased levels of iron and manganese are related to seasonal factors such as temperature change and shifting lake waters. Levels usually decline when the seasonal factors end." Asked what Health Canada was doing to remedy the problem, Durette noted that the federal department's role is to work with the community to test the water and to "recommend to chiefs and councils, or their delegates, what necessary corrective actions should be taken."
Sea salt around the world is contaminated by plastic - Sea salt around the world has been contaminated by plastic pollution, adding to experts’ fears that microplastics are becoming ubiquitous in the environment and finding their way into the food chain via the salt in our diets. Following this week’s revelations in the Guardian about levels of plastic contamination in tap water, new studies have shown that tiny particles have been found in sea salt in the UK, France and Spain, as well as China and now the US.Researchers believe the majority of the contamination comes from microfibres and single-use plastics such as water bottles, items that comprise the majority of plastic waste. Up to 12.7m tonnes of plastic enters the world’s oceans every year, equivalent to dumping one garbage truck of plastic per minute into the world’s oceans, according to the United Nations. “Not only are plastics pervasive in our society in terms of daily use, but they are pervasive in the environment,” said Sherri Mason, a professor at the State University of New York at Fredonia, who led the latest research into plastic contamination in salt. Plastics are “ubiquitous, in the air, water, the seafood we eat, the beer we drink, the salt we use – plastics are just everywhere”. Mason collaborated with researchers at the University of Minnesota to examine microplastics in salt, beer and drinking water. Her research looked at 12 different kinds of salt (including 10 sea salts) bought from US grocery stores around the world. The Guardian received an exclusive look at the forthcoming study. Mason found Americans could be ingesting upwards of 660 particles of plastic each year, if they follow health officials’ advice to eat 2.3 grammes of salt per day. However, most Americans could be ingesting far more, as health officials believe 90% of Americans eat too much salt. The health impact of ingesting plastic is not known. Scientists have struggled to research the impact of plastic on the human body, because they cannot find a control group of humans who have not been exposed.
Northern China smog cuts life expectancy by 3 years versus south: study (Reuters) - Air pollution caused by coal-fired winter heating has slashed life expectancy in northern China by more than three years compared with the south, according to a new study, underlining the urgency of Beijing’s efforts to tackle smog. Researchers with the Energy Policy Institute at the University of Chicago (EPIC) said average lifespans north of the Huai river, where China supplies mostly coal-fired winter heat, were 3.1 years lower than in the south, which is not covered by the state heating policy. EPIC’s study cites long-term smog exposure as a primary cause of the difference. In a statement, EPIC said its study examined pollution and mortality data in 154 cities from 2004 to 2012, and found higher death rates were due entirely to increases in cardiorespiratory illnesses. EPIC didn’t give an absolute number for average life expectancy, but said its study was the first to focus on differences in air quality north and south of the Huai river. “We know on highly polluted days more people die and more people are sick, but what this study helps to isolate are the consequences of long-run sustained exposure,” said Michael Greenstone, EPIC director and one of the report’s authors. China is in the fourth year of a “war on pollution” designed to reverse the damage done by decades of untrammelled economic growth and allay concerns that hazardous smog and widespread water and soil contamination are causing hundreds of thousands of early deaths every year. According to EPIC, if China were to comply with World Health Organization air quality standards, its people could live 3.5 years longer on average.
Australia has hottest winter on record as climate change drives long-term warming trend - The hottest winter ever has been recorded in Australia amid a "long-term warming trend" mostly caused by climate change, according to the country's Bureau of Meteorology. Peak temperatures during the day were up by 1.9 degrees Celsius (3.4 Fahrenheit) on the long-term national average of 21.8C during the period between June and August.Winter rainfall was also down to the least amount since 2002 and the ninth-lowest on record. Australia started charting the statistics in 1900 for rainfall and 1910 for temperatures."You have a long-term warming trend which is largely attributed to changing levels of greenhouse gases," the bureau's senior climatologist Blair Trewin told AFP. "On top of that, to get an individual extreme year like this one, you also need the more general weather pattern to be favourable to warm conditions as well, as this year was."The bureau also noted that 19 of Australia’s last 20 winters had seasonal top temperatures that averaged above the long-term national average.Meteorologist Greg Browning said it was "basically this background warming signal that we're seeing right across the globe associated with global warming". Victoria was faced with the driest winter in more than 10 years, with rainfall “significantly below average,” Mr Trewin told the Herald Sun.
La Nina watch in effect: 55-60 percent chance of developing conditions favorable for cold, snowy winter in Northeast Ohio -- -- Winter is rapidly approaching, and a La Nina could be in the works, bringing colder and snowier than normal conditions for Northeast Ohio, according to the National Oceanic and Atmospheric Administration's latest update.Meteorologists with NOAA's Climate Prediction Center have implemented a La Nina watch, meaning a 55- to 60-percent chance of a La Nina developing this fall and winter."Sea surface temperatures in the key monitoring region of the tropical Pacific have been dropping through the summer, and a deep pool of cool water is lurking below the surface," says NOAA. El Nino and La Nina are the warm and cool phases of a recurring climate pattern across the tropical Pacific, called the El Nino-Southern Oscillation, or ENSO. ENSO conditions are usually felt heaviest in the fall and winter, which is why snow and chilly temperatures are most talked about with a La Nina event. 
La Nina and El Nino are two phases of ENSO, the third is neutral conditions.NOAA/Climate Prediction Center With a La Nina, strengthening winds across the Pacific push the warm surface water away, bringing up cooler water below. This cooler water initiates sinking motion in the atmosphere over the Pacific, which dries things out. The cool water can also shift the position of the jet stream, shifting the threat for severe weather north. Overall, with a La Nina, conditions tend to be colder and wetter to the north, and warmer and drier to the south.
Wildfires have burned an area the size of Maryland - On Wednesday, Seeley Lake set a record for its worst air quality ever recorded, at 18 times the particle pollution limit deemed safe by the Environmental Protection Agency. The air was so bad that, for five hours, the air monitor in Seeley Lake could not measure the particle concentration — it was above the device's limit. This fire season, wildfires like the one above Seeley Lake have burned through nine states: California, Colorado, Idaho, Montana, Nevada, Oregon, Utah, Washington and Wyoming. Through early Friday, there have been 47,705 wildfires reported since the start of the year, slightly below the 10-year-average for this point in the season, according to the National Interagency Coordination Center, which oversees the state and federal response.But many of the fires quickly grew in size, putting the United States on pace to exceed the average acreage burned annually over the past 10 years. Fires nationwide have consumed 8,036,858 acres — about 12,550 square miles, larger than the size of Maryland — since Jan. 1. In an average year, 5,516,000 acres would have burned through this point of the fire season, according to agency statistics.Many of the large fires this year have been concentrated in the northern Rocky and Cascade mountain regions, two areas that are experiencing their worst fire seasons in years.Twenty fires have started in Montana's Glacier National Park, said Mike Johnson, a fire information officer at the park. “Eighteen of those we were able to get under initial attack,” he said. The other two, the Adair Peak fire and the Sprague fire, withstood 143,600 gallons of water poured from helicopters. The fires have been blazing since a lightning storm on Aug. 10.Smoke and low visibility has grounded the helicopters, Johnson said. A predicted low pressure system should blow some of the smoke clear in the next few days. This will aid firefighters, but will also invigorate the wildfires choking beneath the cloud. Meanwhile, the Sprague fire recently claimed a century-old chalet. The park itself remains open, Johnson said, though western sections, including parts of the Going-to-the-Sun Road, are closed.
In a Summer of Wildfires and Hurricanes, My Son Asks “Why Is Everything Going Wrong?” - Naomi Klein - The news from the natural world these days is mostly about water, and understandably so. We hear about the record-setting amounts of water that Hurricane Harvey dumped on Houston and other Gulf cities and towns, mixing with petrochemicals to pollute and poison on an unfathomable scale. We hear too about the epic floods that have displaced hundreds of thousands of people from Bangladesh to Nigeria (though we don’t hear enough). And we are witnessing, yet again, the fearsome force of water and wind as Hurricane Irma — one of the most powerful storms ever recorded — leaves devastation behind in the Caribbean, with Florida now in its sights.Yet for large parts of North America, Europe, and Africa, this summer has not been about water at all. In fact it has been about its absence; it’s been about land so dry and heat so oppressive that forested mountains exploded into smoke like volcanoes. It’s been about fires fierce enough to jump the Columbia River; fast enough to light up the outskirts of Los Angeles like an invading army; and pervasive enough to threaten natural treasures, like the tallest and most ancient sequoia trees and Glacier National Park.For millions of people from California to Greenland, Oregon to Portugal, British Columbia to Montana, Siberia to South Africa, the summer of 2017 has been the summer of fire. And more than anything else, it’s been the summer of ubiquitous, inescapable smoke. For years, climate scientists have warned us that a warming world is an extreme world, in which humanity is buffeted by both brutalizing excesses and stifling absences of the core elements that have kept fragile life in equilibrium for millennia. At the end of the summer of 2017 — with major cities submerged in water and others licked by flames — we are currently living through Exhibit A of this extreme world, one in which natural extremes come head-to-head with social, racial, and economic ones.
Caribbean faces hard road to recovery after Irma's ravages -- (Reuters) - From Cuba to Antigua, Caribbean islanders began counting the cost of Hurricane Irma on Sunday after the brutal storm left a trail of death, destruction and chaos from which the tourist-dependent region could take years to recover. The Category 5 storm, which killed at least 28 people across the region, devastated housing, power supplies and communications, leaving some small islands almost cut off from the world. European nations sent military reinforcements to keep order amid looting, while the damage was expected to total billions of dollars. Ex-pat billionaires and poor islanders alike were forced to take cover as Irma tore roofs off buildings, flipped cars and killed livestock, raging from the Leeward Islands across Puerto Rico and Hispaniola then into Cuba before turning on Florida. Waves of up to 36 feet (11 meters) smashed businesses along the Cuban capital Havana’s sea-side drive on Sunday morning. Further east, high winds whipped Varadero, the island’s most important tourist resort. “It’s a complete disaster and it will take a great deal of work to get Varadero back on its feet,” said Osmel de Armas, 53, an aquatic photographer who works on the beach at the battered resort. Sea-front hotels were evacuated in Havana and relief workers spent the night rescuing people from homes in the city center as the sea penetrated to historic depths in the flood-prone area. U.S President Donald Trump issued a disaster declaration on Sunday for Puerto Rico, where Irma killed at least 3 people and left hundreds of thousands without electricity. Trump also expanded federal funds available to the U.S. Virgin Islands, which suffered extensive damage to homes and infrastructure. Further east in the Caribbean, battered islands such as St. Martin and Barbuda were taking stock of the damage as people began emerging from shelters to scenes of devastation. Dutch Prime Minister Mark Rutte said the death toll on the Dutch part of St. Martin had doubled to four, and that 70 percent of homes had been damaged or destroyed. Following reports of looting, the Netherlands said it would increase its military presence on the island to 550 soldiers by Monday. Rutte said that to ensure order, security forces were authorized to act with a “firm hand”.
Desperation Mounts in Caribbean Islands: ‘All the Food Is Gone’ — At dawn, people began to gather, quietly planning for survival after Hurricane Irma. They started with the grocery stores, scavenging what they needed for sustenance: water, crackers, fruit. But by nightfall on Thursday, what had been a search for food took a more menacing turn, as groups of people, some of them armed, swooped in and took whatever of value was left: electronics, appliances and vehicles. “All the food is gone now,” Jacques Charbonnier, a 63-year-old resident of St. Martin, said in an interview on Sunday. “People are fighting in the streets for what is left.”In the few, long days since Irma pummeled the northeast Caribbean, killing more than two dozen people and leveling 90 percent of the buildings on some islands, the social fabric has begun to fray in some of the hardest-hit communities. Residents of St. Martin, and elsewhere in the region, spoke about a general disintegration of law and order as survivors struggled in the face of severe food and water shortages, and the absence of electricity and phone service.As reports of increasing desperation continued to emerge from the region over the weekend, governments in Britain, France and the Netherlands, which oversee territories in the region, stepped up their response. They defended themselves against criticism that their reaction had been too slow, and insufficient. Both the French and Dutch governments said they were sending in extra troops to restore order, along with the aid that was being airlifted into the region.After an emergency meeting with his government on Sunday, President Emmanuel Macron of France said he would travel on Tuesday to St. Martin, an overseas French territory. Mr. Macron also announced late on Saturday that he would double France’s troop deployment to the region, to 2,200 from 1,100; officials say the increase is in part a response to the mayhem on St. Martin. The Dutch territorial side of the island has also experienced widespread security problems at shops. The issue was reported to have subsided by Sunday, though not completely.
'There's nothing left': British Virgin Islands devastated by Hurricane Irma – video
‘People are roaming like zombies’: Virgin Islands stagger after storm passes — The storm-stricken Caribbean took on the feel of a sprawling disaster zone Sunday, with Cuban first responders using inflatable rafts to navigate flooded streets as panicked families sent up social-media pleas in search of loved ones on hard-hit islands farther east. On St. John in the U.S. Virgin Islands, “people there are roaming like zombies,” said Stacey Alvarado, a bar owner who managed to leave for the mainland. Her husband, who is still there, told her Sunday that residents and tourists are in shock. “They don’t know what to do. The island was wiped out. It’s like the walking dead down there.” Other islanders sent social media messages pleading for help, decrying looting and a series of armed burglaries. “We need help,” wrote St. John blogger Jenn Manes. “We need the United States government to step up. We need military. We need security.” In Cuba, where the government said it had evacuated 1 million residents, Hurricane Irma’s driving winds and pelting rains sent roofs flying, knocked over trees, wrecked building and caused large-scale flooding along the northern coast. Officials in Havana warned of flooding that would last through Monday. In the city of Santa Clara, the Associated Press reported that 39 buildings had collapsed. As streets turned into rivers, authorities took to inflatable rafts to access coastal neighborhoods. Some Cubans had even sought shelter in caves. The brutal storm struck Cuba along a coast studded with resorts that are among the pillars of the island’s economy. Authorities warned of heavy damage from the storm, which has killed at least 25 people across the Caribbean.
'For first time in 300 years, there’s not a single living person on the island of Barbuda' - Barbuda has been left completely devastated by Hurricane Irma. An estimated 95% of Barbuda’s structures are damaged, and the entire island of around 1,800 people has been evacuated. “The damage is complete,” says Ambassador Ronald Sanders, who has served as Antigua and Barbuda’s ambassador to the U.S. since 2015. “For the first time in 300 years, there’s not a single living person on the island of Barbuda — a civilization that has existed on that island for over 300 years has now been extinguished.” According to Sanders, Irma was “the most ferocious, cruel and merciless storm” in the island’s history. The hurricane was 378 miles wide when it descended on Barbuda, which is just 62 square miles.“This was a huge monster,” he says. “The island and the people on the island had absolutely no chance.”Evacuees from Barbuda were sent to Antigua, which did not suffer the same level of damage from Irma. “We’ve had most of the people we’ve brought over to Antigua in shelters,” says Sanders. “We’ve tried to make living accommodations as good as humanly possible in these circumstances. Fortunately, we had planned ahead for this hurricane, and we had ordered supplies in from Miami and the United States before the hurricane hit.”
Hurricane Irma destroyed so many plants in the Caribbean that entire islands changed colour -- Sometimes devastation — like beauty — is best viewed from above. The NASA Earth Observatory has released an astonishing set of images that show the stark contrast between what islands in the Caribbean looked like before and after Hurricane Irma struck. Barbuda, Anguilla, the Virgin Islands, and Cuba were hit by the worst of the storm, with some islands reporting that 90% of their structures were damaged or destroyed. These natural-color images were captured by the Landsat 8 satellite before and after the storm hit. According to NASA science writer Kathryn Hansen, the visible browning of the islands could have been caused by fierce winds, which reached speeds of 185 mph and tore plants and trees from the earth. The salt spray whipped on to the island by the hurricane also likely dried out the leaves on trees — causing them to turn brown. Some islands fared better than others — vegetation on the west of Virgin Gorda (above) appears greener than the rest of the island probably because of shielding by hills in the island center. "Wild isolation that made St. Barts, St. Martin, Anguilla and the Virgin Islands vacation paradises has turned them into cutoff, chaotic nightmares in the wake of Hurricane Irma," the Associated Press reported.
Houston’s Floodwaters Are Tainted With Toxins, Testing Shows — Floodwaters in two Houston neighborhoods have been contaminated with bacteria and toxins that can make people sick, testing organized by The New York Times has found. Residents will need to take precautions to return safely to their homes, public health experts said. It is not clear how far the toxic waters have spread. But Fire Chief Samuel Peña of Houston said over the weekend that there had been breaches at numerous waste treatment plants. The Environmental Protection Agency said on Monday that 40 of 1,219 such plants in the area were not working. The results of The Times’s testing were troubling. Water flowing down Briarhills Parkway in the Houston Energy Corridor contained Escherichia coli, a measure of fecal contamination, at a level more than four times that considered safe. In the Clayton Homes public housing development downtown, along the Buffalo Bayou, scientists found what they considered astonishingly high levels of E. coli in standing water in one family’s living room — levels 135 times those considered safe — as well as elevated levels of lead, arsenic and other heavy metals in sediment from the floodwaters in the kitchen. “There’s pretty clearly sewage contamination, and it’s more concentrated inside the home than outside the home,” said Lauren Stadler, an assistant professor of civil and environmental engineering at Rice University who participated in The Times’s research.
EPA won't release benzene levels collected post-Harvey; private tests show elevated levels - Guadalupe Hernandez is used to the chemical smells that waft through his southeast Houston neighborhood, a low-income, predominantly Hispanic community near a Valero Energy refinery. But when Hurricane Harvey blew in the weekend of Aug. 26, the stench became noticeably stronger for about five hours, a scent like “glue or boiled eggs,” he said. The Environmental Protection Agency has assured the public they looked into complaints in the area a week after the storm hit, and spent several days taking air pollution measurements with a mobile laboratory. The agency didn’t release any specifics, but said concentrations of several toxic chemicals, including the carcinogen benzene, met Texas health guidelines. Now, environmental advocacy groups have shared their own, detailed data with ProPublica and the Texas Tribune, based on air sampling from the same Manchester streets over six days. It shows a more nuanced picture than the one given by the EPA: in numerous locations, benzene levels, though under the Texas threshold of 180 ppb, far exceeded California’s guideline, which is 23 times more stringent and is well-respected by health advocates nationwide. About 10 of the benzene measurements exceeded California’s limit of 8 ppb. (Neither California’s nor Texas’ guideline is legally enforceable; both are thresholds that can trigger regulatory scrutiny). The two highest benzene concentrations, 90 and 77 ppb, were detected within 1,600 feet of a damaged storage tank at the Valero refinery. At the time the data was collected, the wind was blowing from the direction of the tank toward the monitoring sites. Valero reported on Aug. 27 that the rain from Hurricane Harvey had submerged the tank’s floating roof, releasing benzene and crude oil. Satellite images from Aug. 31 released by DigitalGlobe show the caved-in tank at the refinery.
Toxic Aftereffects of Hurricane Harvey Plague Houston - The toxic aftereffects of Hurricane Harvey continue to plague Houston as the city rebuilds three weeks after the devastating storm. Testing conducted by the New York Times earlier this week found instances of E. coli contamination 135 times the legal limit in standing floodwaters around the city. ProPublica and the Texas Tribune reported Thursday that a private firm hired by environmental groups found "concerning" levels of benzene in neighborhoods near a Valero refinery. The U.S. Environmental Protection Agency has said it conducted air monitoring tests after Harvey, but it did not release any specifics. The Trump administration's proposed budget cuts are coming under new scrutiny as the agency's Houston lab, which was marked for closure, becomes a key player in post-Harvey cleanup. For E.coli: New York Times - Benzene: Texas Tribune , NPR - Houston lab: San Antonio Express-News
Irma hit downtown Miami — and turned its biggest streets into rivers -- Hurricane Irma spilled storm waters into some of South Florida’s most valuable coastal real estate Sunday, flooding portions of Old Town in Key West, Miami’s financial district in Brickell, Miami Beach and Fort Lauderdale’s Las Olas Boulevard.Brickell Avenue, the main drag through downtown Miami’s most populous neighborhood, became a three-foot high river choked with debris and fallen branches.The damage across the region will take several days to assess, as flooded roads drain and downed trees and power lines are cleared. But the sight of storm surge cascading through low-lying streets and into buildings suggested a heavy price may be paid, especially in the city of Miami’s prosperous urban core. Even though Miami-Dade and Broward counties avoided a direct hit from Irma, authorities had warned that winds from the storm’s powerful eye could cross the state and dump several feet of water in flood-prone coastal areas. They were right. During the hurricane, social media users flooded the internet with images of waters rising across South Florida, not all of them immediately verifiable. The floods, threatening even from a storm that missed, pose a major threat to a region that depends on a stream of tourists willing to visit and condo buyers who see Miami as ripe for long-term investment. In Brickell, water from Biscayne Bay crashed over a seawall and rushed west towards a forest of condo and office high-rises Sunday morning. Fierce winds screamed between the towers. Southeast 12th Street became a creek of fast-moving, wind-whipped water.
Florida gun owners encouraged to 'shoot the storm' and fire their guns at Hurricane Irma --- A Florida man who suggested shooting guns at Hurricane Irma out of "stress and boredom" has found that his idea has captured peoples' imaginations - with over 46,000 signing up to join in. Hurricane Irma is due to hit Florida on Saturday, and the state is currently experiencing the largest ever mass evacuation due to a hurricane in American history. But Ryon Edwards, 22, came up with a novel way of amusing himself during the storm: firing bullets into it.He started a Facebook "event", and as of Friday evening 46,000 people say they are interested."A combination of stress and boredom made me start the event," he told the BBC."The response is a complete and total surprise to me. "I never envisioned this event becoming some kind of crazy idea larger than myself. It has become something a little out of my control." Graphics suggesting how to shoot at a hurricane have sprung up online, with the suggestion that if you fire correctly the bullet might not come back and kill you. Since Mr Edwards came up with his "masterplan", other similar Facebook pages have been created - including one suggesting using flame throwers to scare away the storm."It's time we took a stand against this bully!" reads the event description. "This is our home, nobody drives us out of our own territory. "Join me in this fight as we shoot flames at Hurricane Irma and dissipate her on the spot."
Half Of Florida Without Power As State Braces For "Lengthiest Restoration In US History" - After hammering the Florida Keys, Miami, Naples and a large swath of the southernmost part of the state – leaving some 5 million Florida homes and businesses without electricity – the still-formidable Hurricane Irma weakened to a category one storm as it traveled over the Tampa Bay area. According to NBC, no deaths were confirmed Sunday after the storm twice made landfall in Florida, first in Cudjoe Key, then again on Marco Island just southwest of the city of Naples.Florida's largest utility – Florida Power & Light Co. - reported that the storm had knocked out power to nearly three-quarters of its customers. All told, FP&L estimates that some 10 million Floridians will be effected by the power outages – a full 50% of the state’s population. In fact, officials from the utility say the damage in the southwestern part of the state is so extensive, it could take weeks to fully repair, after Irma shredded powerlines, flooded streets and destroyed homes, according to ABC. One officials said it could be the costliest and most extensive infrastructure-rebuilding effort in US history. "What we think we'll see on the west coast is a wholesale rebuild of our electric grid," Robert Gould, Florida Power & Light's vice president and chief communications officer, told ABC News. "That will take weeks."
Hurricane Irma: Florida Keys compared to a "war zone" in wake of powerful storm -- Hurricane Irma has battered the Florida Keys, destroying roadways and isolating residents who didn't evacuate the string of islands, prompting one county's emergency management director to call the situation a possible "humanitarian crisis."Irma's powerful eye landed in the Keys as a Category 4 hurricane Sunday morning, swelling waterways to an estimated 10 to 15 feet in some areas, CBS News correspondent Elaine Quijano reports.CBS Miami reporter David Sutta had a hard time describing the devastation on Monday. "Best word I could say is war zone," he said on Twitter. "People are walking to find family and friends. No one knows."It's hard to describe lower keys right now. Best word I could say is war zone. People are walking to find family and friends. No one knows (@SuttaCBSMiami) September 11, 2017 Sutta also tweeted images from several mobile park homes in the Keys, showing homes that were overturned and destroyed by the storm. Sunshine Key RV's tossed around everywhere. @CBSMiami #HurricaneIrma pic.twitter.com/1uzCupxHi3 (@SuttaCBSMiami) September 11, 2017 Local, state and federal authorities are coordinating an airborne relief efforts to bring supplies to residents who didn't evacuate the Keys, Monroe County Administrator Roman Gastes told CBS Miami. "We'll get some water to them as far as the drinking water," Gastesi told the station, adding that he's confident authorities will be able to help the community recover and rebuild. "The keys are a very resilient community. We'll be fine. This is the cost of living in paradise." Crews planned to go from house to house in the Keys in search for residents who need help. The county's emergency management director, Bryan Koon, is calling the storm a possible "humanitarian crisis."
25% Of Homes In Florida Keys Destroyed By Hurricane Irma -- After Hurricane Irma overwhelmed the Florida Keys with 15-foot storm surges and 130 mph winds, causing the worst flooding the chain of islands has experienced in nearly a century, federal officials' first assessment of the damage suggests that nearly a quarter of the homes on the island were destroyed, according to the Associated Press. While not every home is beyond repair, officials said no structures escaped some form of damage. “Basically every house in the Keys was impacted in some way or another,” Federal Emergency Management Agency Administrator Brock Long said at a news conference. “This is why we ask people to leave.” While residents and business owners in the Upper Keys as far south as Islamorada were allowed back into the area Tuesday morning, Monroe County officials urged people to stay away. “Fuel, water, power & medical super limited,” the county said on Twitter, according toWSJ. The county has about 53,000 housing units, census figures show. Nearly all are on the Keys, a 110-mile ribbon of low-lying islands linked by bridges. Monroe County is home to 79,000 people, the vast majority of whom live on the archipelago. Elsewhere, federal authorities have maintained their mandatory evacuation order during the early stages of the cleanup. Throughout the state, some 155,000 people are still in shelters and more than 9 million Floridians lack power, exposing them to the unpleasant summer heat. That’s compared with roughly three-quarters-of-a-million customers were still without power in Georgia and the Carolinas by late Tuesday, according to local utilities. Meanwhile, workers Tuesday rushed to find any victims who had remained on the islands during the storm, and deliver food and water. With phone service still unavailable, the full extent of the destruction was still a question mark.
Calls To Imprison "Climate Change Deniers" Grow In The Wake Of Hurricane Irma -- When retired Georgia Tech professor Judith Curry penned a blog post on her "Climate Etc." website suggesting that it was scientifically irresponsible to tie the intensity of Hurricanes Harvey and Irma directly to climate change, she probably didn't expect that she might trigger 1,000's of progressives to call for her immediate imprisonment. Unfortunately, for both Curry and society at large, that is exactly what happened. Here is part of Curry's post that potentially resulted in this latest 'mass-triggering' event:It is premature to conclude that human activities–and particularly greenhouse gas emissions that cause global warming–have already had a detectable impact on Atlantic hurricane or global tropical cyclone activity. That said, human activities may have already caused changes that are not yet detectable due to the small magnitude of the changes or observational limitations, or are not yet confidently modeled (e.g., aerosol effects on regional climate).As the Washington Times notes, Curry's comments only served to further enrage Al Gore's climate change crusaders who promptly ramped up their calls to imprison anyone with the audacity to present any data and/or question, in any way, climate models which should be accepted as proven fact...even though they're subjective and highly sensitive any number of input variables.That is the kind of talk that could get policymakers who heed her research hauled before the justice system, if some of those in the climate change movement have their way. “Climate change denial should be a crime,” declared the Sept. 1 headline in the Outline. Mark Hertsgaard argued in a Sept. 7 article in the Nation, titled“Climate Denialism Is Literally Killing Us,” that “murder is murder” and “we should punish it as such.”
Irma's Last-Minute Westward Shift May Have Saved Florida $150 Billion In Damages --As it traversed the state of Florida, Hurricane (now tropical depression) Irma left a trail of destruction not seen since Hurricane Andrew hammered the state in 1992. But despite the rising death toll, historic flooding and a ruined power grid that could take weeks to repair, meteorologists say Floridians should consider themselves fortunate.Because it could’ve been much, much worse.“We got very lucky,” Jeff Masters, co-founder of Weather Underground in Ann Arbor, Michigan, told Bloomberg. If Irma had passed 20 miles west of Marco Island instead of striking it on Sunday, “the damage would have been astronomical.” A track like that would have allowed the storm’s powerful eye wall – typically the most destructive area of a hurricane – to ravage Florida’s Gulf Coast. As Masters pointed out, the storm’s last-minute westward shift away from the biggest population center of sprawling Miami-Dade County caused damage estimates to drop to $50 billion Monday, down from $200 billion over the weekend. According to Bloomberg, the last-minute shift was caused by a wind pattern known as the Bermuda High.“The credit goes to the Bermuda High, which acts like a sort of traffic cop for the tropical North Atlantic Ocean. The circular system hovering over Bermuda jostled Irma onto northern Cuba Saturday, where being over land sapped it of some power, and then around the tip of the Florida peninsula, cutting down on storm surge damage on both coasts of the state. ‘The Bermuda High is finite and it has an edge, which was right over Key West,’ Masters said. Irma caught the edge and turned north.” For 10 days, computer-forecast models had struggled with how the Bermuda High might influence the direction of the storm, according to Peter Sousounis, director of meteorology at AIR Worldwide. “I have never watched a forecast more carefully than Irma. I was very surprised not by how one model was going back and forth - but by how all the models were going back and forth.”
Florida Farmers Say Irma's Damage Is The Worst They've Ever Seen --Almost half of Florida’s citrus crops were destroyed during the hurricane and when Florida farmers survey the damage caused by Hurricane Irma, and most are saying it’s theworst destruction to their farms that they’ve ever seen. When the worst of Irma’s fury had passed, Gene McAvoy hit the road to inspect the citrus groves and vegetable fields in Florida. McAvoy is a specialist on vegetable farming at the University of Florida’s extension office in the town of LaBelle. LaBelle is located in the middle of one of the country’s biggest concentrations of vegetable and citrus farms. According to NPR, the storm made a direct hit to those fields. “The eyewall came right over our main production area,” McAvoy says. Irma had destroyed almost half of the citrus crops in the central Florida area, meaning prices are likely going to go up sharply. Many of the destroyed groves of oranges and grapefruit were actually approaching harvest too. But after Irma blew through, it left “50 or 60 percent of the fruit lying in water [or] on the ground,” says McAvoy. Many trees were standing in water, a mortal danger if their roots stay submerged for longer than three or four days. About a quarter of the country’s sugar production comes from fields of sugar cane near Lake Okeechobee, just east of LaBelle.Harvest season for the sugar cane crop is only a few weeks away, but Irma knocked much of the cane down, making it more difficult to harvest. “We won’t know the exact extent of the loss until it’s harvested,” McAvoy says.
Built on air-conditioning, Florida in hot race to restore power - David Guerra stood in his yard in southeast Miami, sweating. “Before AC, nobody lived in Florida -- and for good reason,” Guerra, 55, said Monday when the temperature was sitting at 88 degrees. “It’s easy to forget that this is really a jungle we live in. We’re going to go back to the jungle.” The state may have been spared the most horrible loss of life and destruction of property so many had predicted, but it’s hard to overstate the scale of devastation Irma’s fury brought to the power grid and those who depend on it. All told, 5.5 million homes and businesses didn’t have service as of 12:02 p.m. New York time, down from 6.4 million Monday. The challenge: turning the power back on in a place whose explosive growth was built on air-conditioning. “It’s a magnitude we just haven’t seen before,” Eric Silagy, CEO of NextEra Energy Inc.’s Florida Power & Light, the state’s biggest utility, told reporters Monday. “This is the largest restoration in the company’s history.” Because the transmission network held up better than expected, the utility moved up its forecast for restoring service. Eastern Florida should have power back by Sept. 17, FP&L spokesman Rob Gould told reporters Tuesday, while more heavily damaged regions along the west coast will have to wait until Sept. 22. On Monday, FP&L said it could take weeks to restore power. There’s a lot of human misery behind the numbers, with hospitals, nursing homes, schools and more out of juice. Guerra, a software technician, works from home -- not a possibility at the moment. It’s the heat, though, that compounds the other problems. Guerra has thrown open his windows and doors, and all that seems to do is let more mosquitoes in. Temperatures are forecast to remain in the high 80s in Miami over the next five days.
15 Million in Florida Lose Power During Hurricane Irma: Utilities Say Full Recovery Could Take Weeks - Millions of people in Florida are stuck without power in the wake of Hurricane Irma , and may have to wait for days or even weeks to turn their lights on again. Three out of four Floridians lacked power at the peak of the outage earlier this week, while over 40 percent of the state remains unable to run refrigerators and air conditioners in sweltering late summer heat. Thousands of utility workers from across the country are traveling to Florida to help repair the state's grid and restore service, but utilities say some Floridians may not have power until after September 22. "This is going to be a very uncomfortable time," Robert Gould, vice president at Florida Power and Light, the state's largest utility, told ABC. As reported by the Washington Post : "Utility companies made progress as they undertook a massive recovery effort, restoring power to some. At its peak, the Department of Homeland Security said about 15 million Floridians—an astonishing three out of four state residents—lacked power. By early Wednesday, state officials gradually lowered the number of customers without power, dropping it to about 4.4 million from 6.5 million on Monday. Because each power company account can represent multiple people, the sheer number of residents without electricity was massive: Going by the Homeland Security estimates, at one point Irma had knocked out power to one out of every 22 Americans."
After Irma, Florida prepares for days — and maybe weeks — without power — Millions of Floridians grappled with the aftermath of Hurricane Irma on Wednesday, confronting a sweltering reality: More than 40 percent of Florida still lacked electricity, and for some of them, the lights might not come back on for days or even weeks."We understand what it means to be in the dark," said Robert Gould, vice president and chief communications officer for Florida Power and Light (FPL), the state's largest utility. "We understand what it means to be hot and without air conditioning. We will be restoring power day and night."But, he acknowledged: "This is going to be a very uncomfortable time."Across the nation's third most-populous state, that discomfort played out in homes that were silent without the usual thrum of perpetual air-conditioning. It meant refrigerators were unable to cool milk, laundry machines were unable to clean clothes and, for the particularly young and old, potential danger in a state where the temperatures can range from warm to stifling. Even for those who had power, some also were struggling to maintain cellphone service or Internet access, sending Floridians into tree-riddled streets in an effort to spot a few precious bars of signal to contact loved ones. "It's a mess, a real mess. The biggest issue is power," said Bill Barnett, mayor of Naples, on Florida's Gulf Coast. "We just need power. It's 92 degrees and the sun is out and it's smoking out there."
EPA Grants Florida Utilities Blanket Pollution Waiver After Irma - The U.S. Environmental Protection Agency ( EPA ) granted all Florida power plants a " no action assurance " on Monday as the state tries to turn the lights back on post- Hurricane Irma . The waiver, given at the request of the Florida Department of Environmental Protection and effective through Sept. 26, allows the utilities "to operate without meeting all pollution controls in order to maintain the supply of electricity to customers and critical facilities across the state as a result of Hurricane Irma," EPA said. But as the Associated Press noted in a report, the waiver basically means that electric companies can get away with violating clean air and water standards without penalty for the next two weeks. According to the AP report: "The EPA's assurance letter will allow utilities to operate outside restrictions mandated by their permits, including potentially using dirtier fuels, running for longer hours or electively bypassing pollution control equipment. Coal-fired plants can also discharge wastewater laced with levels of toxic-heavy metals at higher concentrations than what would normally be permitted." As of Tuesday afternoon, more than 5.6 million Florida homes and businesses still remain without power, state officials said. "EPA believes that the exercise of enforcement discretion in these circumstances is in the public interest and will help address the emergency circumstances in Florida," the agency said in a letter.
Millions are without A/C in Florida. Heat illness is their next big threat. It’s arguably the worst timing for a massive power outage in South Florida. This year is on track to be Miami’s warmest on record. The month of July was the hottest the city has ever recorded. Without air conditioning, South Florida weather is oppressive at best and downright dangerous at worst.But on Monday afternoon, 6.1 million customers were without power in the wake of Hurricane Irma, according to the Department of Energy. By Wednesday morning the number of outages was down to 3.5 million — but still more than a third of the state.The lack of power is by far the largest lingering effect of the storm which is now long gone. The clouds have parted, and the sun is back. So is the heat. Without air conditioning, South Florida is a sauna. It’s no Category 4 hurricane, but over the past decade, heat has been the second-most deadly weather phenomenon — on par with flooding and tornadoes. In 1995, Chicago experienced one of the most tragic weather events in U.S. history, . More than 750 people died over the course of a week as temperatures climbed into the triple digits. Notably, overnight lows did not drop below 70 degrees. As the Chicago Tribune reported, the victims of heat illness tend to be “mostly the poor, elderly and others on society’s margins.” Air conditioning could have saved these lives, but — even in 1995 — a large portion of the population didn’t have access; “thousands who had them couldn’t use them because of power failures, and still others couldn’t afford them,” the Tribune wrote.
Eight Dead From Sweltering Nursing Home as Florida Struggles After Irma — The first patient was rushed into the emergency room of Memorial Regional Hospital around 3 a.m. on Wednesday, escaping a nursing home that had lost air-conditioning in the muggy days after Hurricane Irma splintered power lines across the state. Another arrived at 4 a.m. After a third rescue call, around 5 a.m., the hospital’s staff was concerned enough to walk down the street to check the building themselves. What they found was an oven. The Rehabilitation Center at Hollywood Hills needed to be evacuated immediately. Rescue units were hurrying its more than 100 residents out. Dozens of hospital workers established a command center outside, giving red wristbands to patients with critical, life-threatening conditions and yellow and green ones to those in better shape. Checking the nursing home room by room, the hospital staff found three people who were already dead and nearly 40 others who needed red wristbands, many of whom had trouble breathing. The workers rushed them to Memorial’s emergency room, where they were given oxygen. The rest went to other hospitals nearby. Four were so ill that they died soon after arriving. In the afternoon, the authorities learned that another had died early in the morning, and was initially uncounted because the person had been taken directly to a funeral home. In all, eight were dead. “We had no idea the extent of what was going on until we literally sent people room to room to check on people,” said Dr. Randy Katz, the hospital’s chairman of emergency medicine. Three days after the hurricane had howled through South Florida, some of the most vulnerable people in the state were dying, not of wind, not of floods, but of what seemed to be an electrical failure.
No power, no place to go for thousands of South Florida elderly after Irma - Stranded without power in the wake of Hurricane Irma, thousands of South Florida seniors have found themselves trapped — in health care facilities, affordable housing apartments and planned retirement communities — without access to elevators, air conditioning, telephones and even medical devices. An inconvenience for many, days-long power outages pose a danger to the elderly, particularly those who are frail, a threat underscored Wednesday by the deaths of eight residents at a Hollywood nursing home that had lost power during the storm. “It’s criminal what they’re doing,” said Sonia Suarez, 72, president of the residents association for Martin Fine Villas, a Miami-Dade County-run public housing center with 62 disabled tenants. Suarez uses a wheelchair, and she has been unable to recharge her electric wheelchair since the storm knocked out power to the center. Instead, she has been relying on a neighbor to push her wheelchair as she checks on other residents. “There are a lot of people whose health is getting worse,” she said, “because they don’t have electricity.” At least five Martin Fine residents have gone to the hospital since the storm hit, Suarez said. She was also worried about those who remained in the building. “People are going to die here,” she said.
Hurricane Irma’s Chemical Fallout Could Be Worse than Harvey's - Before flames and smoke leaped into the sky over the Arkema chemical plant in Crosby, Texas, last week, Jolyn Masters was hunkered down at home on a Hurricane Harvey-flooded street a mile away. Then came a knock. A National Guard evacuation boat was waiting because of what was expected at Arkema. By the time she returned home on Labor Day, the trailers had burned. Nobody had died. But Masters couldn’t offer comfort to people living near chemical plants as Hurricane Irma bears down. “This wasn’t anything foreseeable,” she said. “So I wouldn’t even know what to tell those people.”What happened in Crosby could happen in Florida, with more disastrous results. It could happen in Homestead, near a pair of nuclear generators; or at plants near Tallahassee that produce potentially explosive ammonia; or rural communities with an expanse of phosphate mines not far from the Gulf Coast.While Crosby appears to have avoided serious tragedy, Arkema executives admitted they were unprepared. The potential dangers stored within chemical plants remain unclear because regulators have acquiesced to industry demands that such information be kept secret for fear of terrorism. And Environmental Protection Agency head Scott Pruitt delayed for two years Obama-era rules requiring companies to be more transparent about what’s in plants and their plans to keep them safe.“One of the best ways to better prepare for these emergencies is to know what you’re dealing with,” said Bill Hoyle, a former senior investigator with the U.S. Chemical Safety Board, an independent agency. “What are the chemicals? How much of the chemical is there and what’s the potential impact? I am sure the people evacuated in Crosby had no idea they were in a vulnerability zone.” The incident at the 43-year-old plant owned by Arkema SA of Paris, France, provided some of Harvey’s most dramatic pictures -- and a fortunate anticlimax. But an analysis by the Center for Biological Diversity in Tucson, Arizona, showed that the Houston area’s hundreds of refineries and petrochemical operations released almost 1 million pounds of air pollutants in Harvey-related spills and flares, including benzene, sulfur dioxide, toluene, and xylene. The effects might not be known for months.
Hurricanes Irma and Harvey Cast Spotlight on Toxic Sites In Our Midst - Our country has just witnessed two of the worst hurricanes in our history and the work of rebuilding shattered lives in Texas, Florida, and elsewhere has barely begun. Toxic cleanup will be a part of the work ahead. This is an area dotted with oil refineries , chemical plants, Superfund sites and coal-fired power plants . All of these structures represent toxic waste and contamination threats during the best of weather times; with storms, these issues become even more dire. Spills and explosions have already contaminated vulnerable communities across the region. And as operations are restarted at industrial sites, toxic plumes with high levels of dangerous contaminants present serious new dangers. Houston officials have reported high levels of cancer-causing benzene near one refinery, with winds scattering the pollution. While the hurricanes have brought these issues more prominently into the spotlight, the truth is that these issues represent battles fought by communities for years about the health hazards lurking behind the fences of the industrial operations and waste sites in people's backyards. And for years, industries and their political allies have dug in their heels when it comes to cleaning up and installing safeguards at these toxic sites. This resistance has only grown under the Trump administration , even as climate change ups the stakes with greater storm intensity. Using the power of the law, Earthjustice has pushed regulators to step up to their role of protecting citizens instead of caving to well-funded corporate interests. "There's no leadership [among officials] here," said Yvette Arellano, research and policy liaison for Texas Environmental Justice Advocacy Services in Houston. "The amount of money coming from industry to influence the political process is incredible." In Texas, storage tanks holding crude oil, gasoline and toxic contaminants failed when storm water from Harvey caused them to collapse, spilling at least 145,000 gallons of fuel and polluting the air. Meanwhile, power failures and subsequent explosions at the Arkema chemical plant forced evacuations within a 1.5 mile radius and creating a plume of dangerous pollutants.
Mosquitoes, carbon monoxide and chemicals are big post-Irma health concerns - Long after the waters have receded, Americans will be grappling with the effects of Hurricanes Harvey and Irma, which broke records and ruined lives as they wreaked havoc on the United States and the Caribbean. Many of those effects will be health-related. State and federal health authorities have warned residents to be on the lookout for mold in their homes, strange rashes on their bodies, stray jagged items in standing water that can lead to infected wounds, and depression and post-traumatic stress disorder as those affected try to stitch their lives back together. Some of the dangers are obvious. For example, drowning is a top cause of hurricane-related fatalities. But there are some lesser-known health threats that Americans face. Here are five of them:
- Carbon monoxide poisoning. After hurricanes, people often struggle without power for days or even weeks. Many people set up generators to provide much-needed electricity while they clean up their homes. But these generators emit odorless, colorless carbon monoxide, which is toxic to breathe, and experts say the gas poses a poisoning risk when the devices are used improperly. Carbon monoxide poisoning accounted for 13 percent of all hurricane-related deaths in Florida in 2005, the Florida Health Department said in a report two years ago about the health dangers associated with hurricanes.
- Chemicals. The winds and storm surge that sweep onto the land during and after a hurricane can unleash dangerous chemicals, as floodwaters inundate industrial sites, overflow sewage and wastewater treatment facilities, and drench agricultural sites.
- Mosquitoes. A lot of attention has fallen on the alligators, snakes and fire ants that were forced from their swampy abodes and into flooded back yards and living rooms during Hurricane Harvey. But the most fearsome creature to emerge from the storm may be the humble mosquito.“ Then as conditions dry up, we will cycle out of those weeks of floodwater mosquitoes, and then begin cycling into a period of time where the disease-transmitting mosquitoes will emerge and build up,”
- Chronic illnesses. The aftermath of a hurricane can spark a variety of health problems, from respiratory illnesses caused by mold outbreaks to infected wounds. But a potentially larger problem for some people is the lack of access to medications and treatment for chronic conditions such as diabetes, asthma and kidney disease.
- Mental health. It’s no surprise that natural disasters can traumatize people, so it perhaps follows that hurricanes can exacerbate mental illness.
Mind The Chemtrails: US Air Force Dispatches Sprayer Aircraft In Response To Harvey --The Pentagon has just dispatched C-130H Sprayers from the Air Force Reserve’s 910th Airlift Wing residing in Youngstown, Ohio to Texas in response to Hurricane Harvey.The aircraft are outfitted with spraying equipment tasked with ‘minimizing the impact of the brutal storm’s aftermath’. According to the article, the specially outfitted C-130Hs can spray wide areas with various chemicals for ‘multiple applications, including dispersing oil spills, destroying invasive vegetation, and controlling insect populations’. Per The Drive,Because there is so much standing and heavily polluted water around Houston and other areas affected by the storm, insects populations are bound to explode, which poses a major health risk to the population of southeastern Texas and the first responders working to get the area back on its feet.Mosquitoes that can carry and transmit malaria, west nile virus, zika, and multiple types of encephalitis will be the target of the operation.Supposedly the C-130s will treat over six million acres of land while dispatched to the region, far more territory than in previous post-hurricane operations. Houstonians and other surrounding areas are about to get their daily dose of chemtrails in large amounts. Each aircraft can spray 190,000 acres per day emitting chemicals into the atmosphere and ultimately ending up in living organisms.
U.S. Air Force Is Spraying 6 Million Acres With Chemicals in Response to Harvey - Amid statewide efforts to clean up the aftermath left by the historic flooding caused by Hurricane Harvey , the Pentagon announced last week that it had dispatched C-130H Sprayers from the Air Force Reserve's 910th Airlift Wing in order to "assist with recovery efforts in eastern Texas." However, these "recovery efforts" have little to do with rebuilding damaged structures or with the resettlement of evacuees. Instead, they are set to spray chemicals in order to help "control pest insect populations," which they allege pose a "health risk to rescue workers and residents of Houston." The Pentagon has requested that the planes treat more than 6 million acres throughout the Houston area. The Air Force noted that the current effort is "expected to significantly surpass previous [spraying] missions in scope," specifically the spraying campaigns that followed Hurricanes Katrina and Rita. While the Pentagon has framed its efforts to "assist" as seeking to eliminate a potential human health risk, the particular chemical it is using to control insect populations is likely to do more harm than good. According to the Air Force, the mosquito control protocol involves spraying the "Environmental Protection Agency (EPA) approved and regulated material, Naled," which the Air Force insists will not be used in amounts large enough to "cause any concern for human health." However, the insecticide Naled, manufactured and sold by a strategic partner of Monsanto , is currently banned in the European Union due to the " unacceptable risk " it presents to human health. Naled is a known neurotoxin in animals and humans, as it inhibits acetylcholinesterase—an enzyme essential to nerve function and communication—and has even been known to have caused paralysis. Mounting scientific evidence , including a recent Harvard study , has also pointed to Naled's responsibility for the mass die-off of North American bees. Just one day of Naled spraying in South Carolina killed more than 2.5 million bees last year. Yet, the most concerning consequence Naled poses for human health is the chemical's ability to cross the placental barrier—meaning that Naled freely crosses from mother to fetus. A study conducted at the University of Oslo found that Naled's breakdown product, dichlorvos, caused a 15 percent decrease in the brain size of newborn guinea pigs when their mothers were exposed to Naled for only three days during pregnancy. Doctors from Puerto Rico have also claimed that Naled harms fetuses .
Cities Swimming in Raw Sewage as Hurricanes Overwhelm Systems - Millions of gallons of poorly treated wastewater and raw sewage flowed into the bays, canals and city streets of Florida from facilities serving some of the nation’s fastest-growing counties. More than 9 million gallons of releases tied to Irma have been reported as of late Tuesday as inundated plants were submerged, forced to bypass treatment or lost power. Such overflows, which can spread disease-causing pathogens, are happening more often, as population shifts and increasingly strong storms strain the capacity of plants and decades-old infrastructure. The Environmental Protection Agency estimated last year that $271 billion is needed to maintain and improve the nation’s wastewater pipes, treatment plants and associated infrastructure. "There’s no sewer system in the world that can be built that’s completely leak proof," said Nathan Gardner-Andrews, chief advocacy officer for the National Association of Clean Water Agencies. Plants generally are designed to handle twice their normal capacity, but "when you get some of these rain events and you’re talking four to six to eight inches of rain in an hour, the engineering is such that you cannot build a system to hold that capacity." A treatment facility in Clearwater, Florida discharged 1.6 million gallons of wastewater into a creek, according to filings with the state’s Department of Environmental Protection. That scene was replayed across the state this week, as electrical outages caused lift station pumps to stop running in St. Petersburg and Orlando, prompting at least 500,000 gallons of overflows. A pipeline broke in Miramar, Florida, sending sewage spilling across a parkway as contractors hunted for the rupture. And operators of a Miami-area wastewater treatment plant blamed a power outage for 6 million gallons of sewage released into Biscayne Bay. As wastewater treatment lagged, utilities across the state warned residents to boil water before drinking it. The U.S. Environmental Protection Agency said it has deployed specialists to Florida to help get wastewater systems back online.
Hurricane Irma Released "250 Million Gallons Of Untreated Sewage" Into The Streets Of Florida -- Thanks to their low cost of living, and minimal taxes, Florida and Texas are among the states in the US where populations are rising via interstate migration. Contrast that with Connecticut, which is far less vulnerable to hurricanes, and where the population drain has accelerated dramatically in recent years. Both Harvey and Irma impacted some of the fastest-growing counties in the US, exposing a problem that’s probably frustrated city and county officials for years. How to upgrade decades-old sewage and water-treatment systems. When the storms struck, the ancient systems quickly failed, releasing millions of gallons of raw sewage into city streets and canals, complicating the cleanup effort, according to Bloomberg: “Millions of gallons of poorly treated wastewater and raw sewage flowed into the bays, canals and city streets of Florida from facilities serving some of the nation’s fastest-growing counties. In fact, 4 of the 10 fastest-growing coastal counties in the eastern U.S. are in Florida. More than 9 million gallons of releases tied to Irma have been reported as of late Tuesday as inundated plants were submerged, forced to bypass treatment or lost power.” Of course, this problem requires a monumentally expensive fix: The Environmental Protection Agency estimated last year that $271 billion is needed to maintain and improve the nation’s wastewater pipes, treatment plants and associated infrastructure. In fact, many parts of Florida and Texas face infrastructure challenges even when they aren’t deluged by rain because of rapid population growth.
Florida’s Poop Nightmare Has Come True - In the days and hours before Hurricane Irma slammed into Florida, its residents were treated to copious media speculation about nightmare scenarios. This monster storm, journalists said, could bring a 15-foot storm surge, blow roofs off of buildings, and cause tens of billions of dollars in damage. But perhaps no scenario seemed more dire than the one Quartz warned about the day before Irma made landfall: “Hurricane Irma will likely cover South Florida with a film of poop.” Quartz’ apparent hyperbole turned out to be an understatement. Pollution reports submitted to Florida’s Department of Environmental Protection show that, due to power outages and flooding caused by Irma, human waste has been spilling into streets, residences, and waterways across the entire state. At the time of this article’s publication, at least 113 “Public Notices of Pollution” had been submitted to the DEP. Combined, those discharge reports showed more than 28 million gallons of treated and untreated sewage released in 22 counties. The total amount is surely much more; at least 43 of those reports listed either an “unknown” or “ongoing” amount of waste released, and new reports continue to roll in—sometimes as many as a dozen per hour. In other words, Irma was a literal shitstorm. But it’s no laughing matter. The spills in Florida range from benign to revolting. In some cases, a few hundred gallons of raw sewage burst from manholes into non-flooded areas and were quickly cleaned up. But in Miami, the city’s South District Wastewater Treatment Plant reported a six-million-gallon sewage spill that reached Biscayne Bay, a state aquatic preserve. While the report said the area was cleaned and disinfected, it also says the public was not notified and the sewage was not recovered. In Seminole County, north of Orlando, a sewer overflowed for six hours, spilling two million gallons. And in Volusia County, which holds Daytona Beach, a two-million-gallon spill of treated sewage has seen “no cleanup efforts” so far, according to a notice.
Hurricane Irma: Orlando area may wait for federal aid -- Central Florida’s recovery process began this week with elected property appraisers in Orange, Seminole, Lake and Osceola counties beginning to tally damage estimates that help determine federal aid efforts. “We’ve got about 64 staff members going through the county looking at damage and, essentially, putting a dollar figure on the damage,” said Orange County Property Appraiser Rick Singh, who toured damage Tuesday, including the flooded streets of Orlo Vista. Federal Emergency Management Agency officials said they have seen aid from past catastrophes begin to arrive in as little as a few days or as long as a few weeks. With counties throughout Florida seeking federal assistance on the heels of historic flooding in southeast Texas, federal relief could take longer than it has in the past. The speed and amount of federal aid that comes to Central Florida depends on everything from the amount of debris that gets carted away to how well counties prepared for the event, which hit Central Florida with hurricane-force winds early Monday. What was uncertain Tuesday was whether Orange, Lake, Seminole or Osceola counties would become eligible for FEMA’s “individual assistance,” which gives survivors timely access to programs, including unemployment assistance and housing assistance. By Tuesday, FEMA had approved 16 counties — mostly coastal — for the assistance. The agency weighs damage amounts, insurance coverage, homes impacted and inaccessible communities in determining eligibility. Orange County began the work over the weekend to get in the pipeline for federal aid, Orange County Mayor Teresa Jacobs said on Tuesday. A challenge, she added, was that the federal government had earmarked certain counties that were expected to be impacted but didn’t anticipate that Central Florida would suffer significant damages. The county is working with the state to ensure the county is included, she said.
Trump FEMA nominee withdraws following NBC report | TheHill: President Trump's nominee for the Federal Emergency Management Agency's (FEMA) No. 2 spot has pulled his name from consideration, according to NBC News. Daniel A. Craig withdrew on Wednesday after NBC reported on a federal probe showing he had falsified government travel and timekeeping records during his time in the Bush administration in 2005. "Given the distraction this will cause the Agency in a time when they cannot afford to lose focus, I have withdrawn from my nomination," Craig told NBC News. The joint FBI and Homeland Security probe found Craig had awarded FEMA contracts in the wake of Hurricane Katrina in 2005, breaking conflict-of-interest laws. The report, which NBC reviewed, was from 2011 but never made public. He had previously served as FEMA's Director of Recovery, according to the White House. The White House announced its intent to hire him in July. Craig has maintained his innocence and told NBC he has never hidden the probe from the White House or the Senate, which would have voted on his confirmation. Craig most recently worked at the consulting firm Adjusters International, Inc., which dealt with disaster preparedness. The development comes as FEMA finds itself in the spotlight, working to provide recovery aid to Florida, Texas and Louisiana, which were battered in by Hurricanes Harvey and Irma.
Irma Unleashes Record Flooding in South Carolina -- Jacksonville and Charleston, South Carolina are facing record-breaking flooding in the wake of Hurricane Irma . Jacksonville officials say the "historic" flooding in the city exceeds levels not seen since 1846, while tidal levels in Charleston reached nearly 10 feet—8 inches higher than levels during Hurricane Matthew last year. Much of the flooding in these two cities is compound flooding, in which run-off from extreme rainfall meets storm surge coming up from rivers, both of which are amplified by climate change . While cities like Tampa escaped worst-case storm surge predictions, cities up and down the Florida coastline continue to assess damage wrought by Irma, with officials warning of a possible "humanitarian crisis" in the hard-hit Florida Keys. More on Flooding: Miami Herald , USA Today , Post and Courier , The Guardian , Fox News , NBC , CNN
Hurricanes Harvey and Irma may have caused up to $200 billion in damage, comparable to Katrina - ABC NewsHurricanes Harvey and Irma caused between $150 billion and $200 billion in damage to Texas and Florida, comparable to the costs from Hurricane Katrina in New Orleans in 2005, a according to a preliminary estimate from Moody's Analytics on Monday. Hurricane Harvey battered Houston with record amounts of rain and flooding last month while Irma slammed Florida and other southeastern coastal states. But Mark Zandi, chief economist at Moody's Analytics, said rebuilding from the back-to-back storms will boost the U.S. economy in the fourth quarter of this year and into 2018. "While at this point it’s hard to know how much [damage there is], the storms seem likely to have caused $150 billion to $200 billion in total damage to homes and furnishings, vehicles, commercial real estate, and public infrastructure. This is comparable to the property loss resulting from Hurricane Katrina," Zandi's analysis states. The Moody's economist added that a critical factor in determining the effect on the economy is "how much insurance money and government aid flows to the impacted regions, and how quickly these funds get there ... As with most natural disasters in recent years, we anticipate that the combination of insurance money and government aid with roughly cover the full cost of the property damage and the lost economic output." He also said that the timing and magnitude of the rebuilding bump to economic growth will depend on labor availability in Texas and Florida. "There were already mounting labor shortages in both Texas and Florida before the storms, and they will surely be much more acute in their wake. Enticing construction workers in other parts of the country to the storm-ravaged areas won’t be easy, even at higher wages. Nonetheless, we anticipate most of the rebuilding, save to damaged public infrastructure, to be completed by the end of 2018."
Irma Makes Its Mark in Weather Records - Some of the worst impacts of Hurricane Irma were still coming to light on Tuesday, a day after the National Weather Service wrote its final advisory on the storm. Irma’s unique place in weather history is already clear, though. Phil Klotzbach (Colorado State University) released a compilation Monday night of the many records set during Irma’s long, eventful life as a tropical cyclone. Here are some highlights:
- Strongest Atlantic hurricane outside the Gulf of Mexico and Caribbean. Irma set this record in two ways: top sustained winds (185 mph, beating the 175 mph from Hurricane Andrew) and lowest central pressure (914 mb, just ahead of the 915 mb estimated for Hurricane Isabel in 2003). The only hurricane recorded anywhere in the Atlantic with stronger sustained winds than Irma was Hurricane Allen (1980), at 190 mph.
- Longevity as a behemoth. Irma racked up a 37-hour stretch with top winds of 185 mph. This beats the global record of 24 hours at or above 185 mph set by Typhoon Haiyan in 2013. Irma spent a total of 3.25 days at Category 5 strength, most of it in a long stretch from Sept. 5 to 8. This puts Irma in a tie with the 1932 Cuba hurricane as the Atlantic storm with the most hours at Cat 5 strength. Before Irma, no Atlantic storm in the satellite era (1966-present) had racked up three consecutive days as a Cat 5. Only Hurricane Ivan (2004) spent more time as a major hurricane (Cat 3/4/5) than Irma’s 8.5 days.
- Strength at landfall. No hurricane as strong as Irma had ever been confirmed in the Leeward Islands region (defined by Klotzbach as 15 - 19°N and 60 – 65°W). The previous record-holders were the Okeechobee Hurricane of 1928 and Hurricane David (1979). Both of these hit the Leeward region with winds of 160 mph, and just like Irma, both hurricanes went on to strike Florida. Irma’s landfall on the north coast of Cuba made it the first Cat 5 to strike the nation since the Cuba Hurricane of 1924. Fortunately, Cuba was spared the more intense north side of Irma. From the Juxtaposition Department: the paths of Irma and Hurricane Wilma (2005)—the last major hurricane to strike Florida before Irma—coincided over Marco Island, Florida. Both storms made landfall at 25.9°N, 81.7°F as Category 3 hurricanes.
- An ace at ACE. Accumulated cyclone energy (ACE) is a function of a hurricane’s peak wind speeds and its longevity. It’s most relevant in the satellite era, where we have more consistent and frequent estimates of top winds. Irma produced more accumulated cyclone energy (ACE) in a 24-hour period than any other Atlantic storm on record, beating Allen (1980). Irma’s total 67.5 units of ACE puts it within the range of 61-111 units cited by NOAA as being near-normal for an entire Atlantic hurricane season (!). It's also the second highest ACE for any Atlantic hurricane in the satellite era, once again trailing only Ivan (2004).
UN Chief Asks Nations to Commit to Paris Deal Amid ‘Dramatic Floods’ -- Citing the “dramatic floods” in India and Nepal, UN chief Antonio Guterres has urged nations to commit to the historic Paris deal to address the threats posed by climate change as natural disasters become frequent and more devastating. Weeks of torrential monsoon rains and catastrophic flooding in India, Nepal and Bangladesh have devastated the lives of millions of children and families. UNICEF estimates that almost 16 million children and their families are in urgent need of life-saving support. Since mid-August, there have been at least 1,288 reported deaths. “First of all, climate change today is undeniable. In the US, as in Portugal and other parts of the world, we are seeing heat waves, we are seeing dramatic floods Sierra Leone, India, Nepal we always had floods in the past but now natural disasters are becoming more frequent, more intense and with more devastating consequences,” Guterres said. He said as deserts are progressing, glaciers diminishing and sea levels starting to rise, it is clearly a threat to humanity. “To fight it we have today an important instrument the Paris Agreement. We need to make sure that all countries commit themselves to that [accord],” he said. Without naming the US, which has decided to pull out of the climate accord, Guterres said wherever countries are not able to commit to the climate deal at the government level, societies, the business communities and cities should lead the process.
Thousands hit by malaria, dengue as S.Asia's worst floods in decade recede (Reuters) - Thousands of people are suffering from an outbreak of diarrhoea, malaria and dengue in Bangladesh and Nepal as the waters from the worst floods in a decade recede, officials and aid agencies said on Wednesday. More than 1,400 people have died in the floods that have swept South Asia over the past two months and tens of thousands are living in tents, schools and even just under tarpaulins. "These people need our help, and we are doing all we can to meet their needs," said Martin Faller, deputy director of the International Federation of the Red Cross in the Asia-Pacific region. About 13,000 people are ill with diarrhoea and respiratory infections in densely populated Bangladesh after floods in its north, where the Brahmaputra and Jamuna rivers broke their banks. "Diseases such as diarrhoea, malaria and dengue are on the rise in some areas and we need support to prevent further death and suffering," said Mozharul Huq, secretary general of the Bangladesh Red Crescent Society. In the Himalayan nation of Nepal, 26,944 cases of illness have been reported by district health facilities, while 39,712 people had been treated in health camps by Aug. 30, the health ministry said. But no epidemic has yet been reported, although health officials were monitoring conditions in flood-affected areas to spot possible outbreaks, the ministry said in a status report. Save the Children said some communities had been entirely wiped out in India's eastern state of Bihar, just over the border from Nepal, with not a single building left undamaged. The agency estimated 17 million children needed help with protection, health care and basic nutrition in India alone.
Pakistan, Polio and the CIA - In the mid-20th century, poliovirus paralysed half a million children a year, in rich countries as well as poor. In 1952 there were 57,628 cases in the United States. Following the development of vaccines by Jonas Salk and Albert Sabin, polio declined markedly in North America and Europe. The US had its last case in 1979, the UK in 1982.There were still, however, about 350,000 cases a year in the mid-1980s, predominantly in countries where the state did not have the money or capacity to implement mass vaccination programmes. The Global Polio Eradication Initiative was formed in 1988 by the WHO and national governments to finance and organise immunisation campaigns. It precipitated a sharp reduction in polio: there were 37 cases in the world in 2016, a fall of 99.9 per cent.But the disease stubbornly persists in Nigeria, Afghanistan and Pakistan. By the mid-2000s, Pakistan had almost eradicated polio: there were only 28 cases in 2005, 1.4 per cent of the global total. But there have been 380 in the last three years, 81 per cent of polio cases worldwide. More than half of them were in the semi-autonomous Federally Administered Tribal Areas (FATA) of northwest Pakistan, where only 2 per cent of the population live. After the invasion of Afghanistan by American-led forces in 2001, many Taliban fighters relocated to the FATA, from where they launched cross-border attacks. The Pakistani army tried to bring the region under government control but the incursion aggrieved local communities, who joined forces with the militants. The CIA used drone strikes to support Pakistani military action from 2004 onwards. According to the Bureau of Investigative Journalism, there have been 428 drone strikes, leading to between 2511 and 4020 fatalities. Vaccination campaigns were suspected of being a smokescreen for collecting intelligence ahead of drone strikes. Polio vaccinators visit the FATA every few months, walking from door-to-door, offering to vaccinate children, and recording who has been vaccinated. The data is collected for public health purposes, but you can see how it might be misconstrued as intelligence gathering.
Amazon massacre Members of uncontacted tribe killed by miners, reports say - Members of an uncontacted tribe, said to include women and children, have allegedly been massacred by gold miners in a remote part of the Brazilian Amazon. Federal prosecutors in Brazil have opened an investigation into the reported massacre of about 10 members of the tribe, according to the New York Times. FUNAI, the Brazilian government Indian Affairs department, told Fox News that at its request, the Federal Public Prosecutor's Office of Tabatinga in the state of Amazonas, has been investigating the alleged killings, together with the Federal Police. The New York Times reports that the investigation was launched after the gold miners were heard bragging about the killings in a bar. The miners reported brandished a hand-carved paddle taken from the tribe. The reported massacre took place last month along the River Jandiatuba in Western Brazil, according to tribal advocacy group Survival International, which reports that more than ten members of the tribe were massacred. “If confirmed, this means up to a fifth of the entire tribe have been wiped out,” the group added in a statement. Survival International noted that women and children are believed to be among the dead. FUNAI says that the area under investigation is near the Jandiatuba and Jutaí rivers, near Brazil’s border with Peru, about 621 miles from the city of Manaus. The miners who discussed the attack were arrested and questioned but have not confirmed the deaths. “To date, no material evidence has been found to substantiate the alleged massacre, so it is not possible to confirm the veracity of the deaths,” said FUNAI. The alleged massacre highlights the threats faced by remote tribes, from violence to exposure to diseases carried by newcomers such as flu and measles.Survival International says that there is inadequate government funding in Brazil for groups protecting indigenous territories in the Amazon. “The Indians are more vulnerable now than they have been for years, as they’re now at the mercy of thousands of loggers and goldminers who are massing on their borders, or actually invading with impunity,”
Reported murder of 'uncontacted' tribe exposes mining threats in Brazil's Amazon (Thomson Reuters Foundation) - Endangered indigenous tribes are increasingly facing threats from miners in the Amazon rainforest amid budget cuts to the Brazilian government agency responsible for protecting them, local officials and activists say. A federal prosecutor in Brazil’s Amazonas state has launched an investigation into a reported massacre of at least 10 members of an “uncontacted” tribe by gold miners in a remote area along the Jandiatuba river, close to Peru’s border. A unit of the indigenous affairs agency, Funai, was recently closed, leaving indigenous lands exposed to invaders, activists say. “There is an ongoing inquiry into the case but I cannot speak about its content in order to not prejudice the investigation,” federal prosecutor Pablo Beltrand told the Thomson Reuters Foundation. If confirmed, the massacre would be one of the worst such tragedies since the murder of 16 Yanomami indigenous people in 1993. Funai officials in Amazonas received an audio clip with miners bragging about the crime, said Gustavo Souza, acting coordinator of Funai’s ethno-environmental protection front at Vale do Javari, where the murders allegedly took place. Souza said he heard miners in the recording saying there were women and children on the river bank and they shot them. “In the audio, one of the miners said ‘you know, I do not mistake a shot’,” Souza told the Thomson Reuters Foundation. He also saw a picture of a hand-crafted paddle that reportedly belonged to the indigenous tribe.
Six farmers shot dead over land rights battle in Peru - Six farmers have been shot dead by a criminal gang who wanted to seize their farms to muscle in on the lucrative palm oil trade, according to indigenous Amazon leaders in Peru. Local leaders in the central Amazon region of Ucayali say the victims were targeted last Friday because they had refused to give up their land. A police report seen by the Guardian details how the farmers’ bodies were found early on Saturday dumped in a stream near the Bajo Rayal hamlet where the men had lived. “It was a night-time ambush. They bound them by their hands and feet, then they killed them and threw them in a river,” Robert Guimaraes, president of the local indigenous federation Feconau, told the Guardian by phone.The police report says most of the men had shotgun wounds to the neck and at least one was found bound by the hands and feet. An eyewitness told the police the victims were attacked by up to 40 armed men who had their faces covered.“We have received death threats from the same land trafficking gang,” Guimaraes said. “We are afraid for our families and we are asking the state for protection.”“These peasant farmers have paid the price for the inaction of the state and the local authorities in tackling land trafficking,” he added, warning that the nearby Santa Clara de Uchunya community had also been threatened by land traffickers.Guimaraes accused the local agricultural authority of handing out falsified land titles and said it also bore “direct responsibility” for the crime. A local investigation alleges former officials colluded in the falsification of land titles which were then sold to highest bidder. “Everything points to regional government people being involved in trafficking land,” said Jose Luis Guzmán, an environmental prosecutor in the Amazon region which is plagued by illegal logging.
Global Ocean Circulation Appears To Be Collapsing Due To A Warming Planet – Forbes - A recent study published in Nature outlines research by a team of Yale University and University of Southhampton scientists. The team found evidence that Arctic ice loss is potentially negatively impacting the planet's largest ocean circulation system. While scientists do have some analogs as to how this may impact the world, we will be largely in uncharted territory. AMOC is one of the largest current systems in the Atlantic Ocean and the world. Generally speaking, it transports warm and salty water northward from the tropics to South and East of Greenland. This warm water cools to ambient water temperature then sinks as it is saltier and thus denser than the relatively more fresh surrounding water. The dense mass of water sinks to the base of the North Atlantic Ocean and is pushed south along the abyss of the Atlantic Ocean. This process whereby water is transported into the Northern Atlantic Ocean acts to distribute ocean water globally. What's more important, and the basis for concern of many scientists is this mechanism is one of the most efficient ways Earth transports heat from the tropics to the northern latitudes. The warm water transported from the tropics to the North Atlantic releases heat to the atmosphere, playing a key role in warming of western Europe. You likely have heard of one of the more popular components of the AMOC, the Gulf Stream which brings warm tropical water to the western coasts of Europe. Evidence is growing that the comparatively cold zone within the Northern Atlantic could be due to a slowdown of this global ocean water circulation. Hence, a slowdown in the planet's ability to transfer heat from the tropics to the northern latitudes. The cold zone could be due to melting of ice in the Arctic and Greenland. This would cause a cold fresh water cap over the North Atlantic, inhibiting sinking of salty tropical waters. This would in effect slow down the global circulation and hinder the transport of warm tropical waters north.
How the Greenland ice sheet fared in 2017 - Overall, initial figures suggest that Greenland may have gained a small amount of ice over the 2016-17 year. If confirmed, this would mark a one-year blip in the long-term trend of year-on-year declines over recent decades. The unusual year is mainly down to heavy snow and rain in winter and a relatively short and intermittent summer melt season. And the source of that bumper winter snowfall was the remnants of a hurricane that wreaked widespread damage 4,500km away in Bermuda. Each year, Greenland’s glaciers gain ice from snow and freezing rain and lose ice through melting. Taken together, these elements give the surface mass budget (SMB) for the whole ice sheet. Typically, Greenland gains ice mass on its surface from around September to May and then loses ice in the “ablation” season of June, July and August. “Ablation” refers to when ice melts and runs off the ice sheet into the ocean (rather than when meltwater stays put and refreezes).At DMI, we use a weather forecasting model to calculate how much Greenland ice is gained and lost every day. Totalled over the course of a year, from 1 September to 31 August, this gives us the “annual surface mass budget”, which provides something like a health check for the ice sheet. For the 2016-17 SMB year, which ended yesterday, the ice sheet had gained 544bn tonnes of ice, compared to an average for 1981-2010 of 368bn tonnes. You can see how the year has panned out in the charts below. The upper chart shows the daily ice gain/loss for 2016-17, with the gain from September to May, and the losses during the summer melt season. The lower chart shows these daily figures cumulatively over the course of 2016-17 (blue line), with the 1981-2010 average (grey) and the record low SMB of 2011-12 (red) for comparison.
Researchers find secret, warm oasis beneath Antarctica's ice that could be home to undiscovered species -- Deep within Antarctica’s ice caves, a group of scientists may have discovered a secret ecosystem of plants and animals being supported by the warmth of an active volcano. Although average year-long temperatures on Ross Island hover around -17C, including six months between April and September where they don’t rise above -20C, the temperature in cave systems beneath the glaciers can reach 25C. “You could wear a T-shirt in there and be pretty comfortable,” lead researcher Ceridwen Fraser said. “There’s light near the cave mouths, and light filters deeper into some caves where the overlying ice is thin.” Located around and beneath Mount Erebus, an active volcano, the caves have been hollowed out after years of steam travelling through their passages. The study of the caves, led by the Australian National University, evolved into an analysis of the soil within. Fraser revealed that it contained traces of DNA from algae, mosses and even small animals that could be living in the underground oasis. Most of the DNA, Fraser admits, is similar to that of species living on the surface. However, not all the sequences studied could be linked to a particular animal or plant group, meaning Fraser may be on the cusp of discovering new lifeforms as well. “Our study gives us a really exciting, tantalizing glimpse of the sorts of plants and animals that might live beneath the ice in Antarctica,” she said. “Some of the DNA evidence that we found suggests that maybe there are things living in these caves that we know nothing about.
Trump adviser Cohn to host breakfast on climate ahead of UN meeting (Reuters) - President Donald Trump’s top economic adviser, Gary Cohn, will hold a breakfast for international officials focused on energy and climate issues next week, according to a copy of the invitation for the event seen by Reuters on Tuesday. Cohn, director of the National Economic Council, will host the meeting on Monday in New York City before the start of the United Nations General Assembly. “This breakfast is an opportunity for key ministers with responsibility for these issues to engage in an informal exchange of views and discuss how we can move forward most productively,” the invitation said. It was unclear how many officials received the invitation. Trump sparked outrage from international partners in June when he announced his decision to withdraw the United States from the Paris Climate Agreement, arguing that it put U.S. industries at a disadvantage. The Trump administration has said it would continue to participate in United Nations climate change meetings during the withdrawal process, which is expected to take at least three years. Cohn’s relationship with Trump has been strained in recent weeks, after Cohn criticized the president for his response to violence at a rally organized by white nationalists in Charlottesville, Virginia.
White House Economic Advisor Invites Foreign Officials to Discuss Climate Change - White House chief economic advisor Gary Cohn will host a discussion on climate change ahead of the United Nations General Assembly meeting, according to reports. The breakfast meeting, scheduled the day before the UNGA kickoff in New York on Tuesday, will convene environment ministers and senior climate officials from the world's largest economies. A White House official said the meeting was intended to "help the Trump administration find a way to fulfill the president's pledge to reduce emissions without harming the American economy," according to the New York Times. News of the meeting comes a day after White House press secretary Sarah Huckabee Sanders indicated Trump had not changed his mind on climate change in the wake of the devastation wrought by Hurricanes Harvey and Irma. As reported by the New York Times : "It is too early to say what may come out of the meeting, but it shows that the U.S. is keen to engage with key countries," said one diplomat who asked not to be identified because he was not authorized to speak for his government. "If the U.S. expresses its clear intent on addressing climate change issues at the meeting, that would be a positive sign."
Pentagon Moves Ahead With Obama-Era Climate Preparation Plan Despite Trump's Orders - The Department of Defense (DoD) has warned for years that climate change is a national security threat and, despite President Trump 's orders, the agency continue to take steps to help the military navigate and prepare for the impacts of a warming planet. As Military Times reports, the Pentagon is plowing ahead with its 2014 "Climate Change Adaptation Roadmap" even though Trump issued an executive order in March seeking to reverse Obama-era federal climate and clean energy initiatives. But now—thanks to Trump–the agency is reviewing directive 4715.21 "to determine if it should be suspended, revised, or rescinded," Pentagon spokesman Lt. Cmdr. Patrick Evans told the publication. However, the department is still preparing for the effects of climate change even though Trump told them to stop. For instance, as Military Times reports, the Naval Facilities Engineering Command (NAVFAC) Mid-Atlantic has been taking steps to protect the Hampton Roads base in Virginia—home to 60 Navy ships, hundreds of fix-wing and rotary aircraft and more than 83,000 active duty personnel. The 2014 climate roadmap, which Trump invalidated, stipulated that the assets were protected from a "projected sea-level rise of 1.5 feet over the next 20 to 50 years." "I can't talk the science, but I can tell you what we've done," Todd Lyman, NAVFAC Mid-Atlantic spokesman, explained. "For many years, NAVFAC has been replacing any single-deck pier with double-deck piers. We've also built structures here at a higher elevation than code requires in an effort to improve stormwater management. The goal is for us to continue our mission, maintain resilience."
EPA Chemical Safety Nominee Is a Hired Gun for Tobacco and Chemical Industries - For decades, a weak law left Americans at risk from toxic chemicals in everyday products such as cleaners and fabrics. As a result, chemicals tied to infertility, learning disabilities and even cancer found their way into all our homes, schools and workplaces. A turn-around looked likely in 2016 when Congress passed a strong, bipartisan law to overhaul the Toxic Substances Control Act to better protect our health. The agency charged with carrying out the new law hit the ground running and was making good progress. That is, until a new president was elected and new leadership took over the reins at the U.S. Environmental Protection Agency ( EPA ). The Trump administration first installed a top official from the main chemical industry lobbying group to oversee changes to rules that will determine how chemicals are reviewed for safety. The changes she made could undermine efforts to protect us from harmful chemicals for many years to come, according to Politico . The push to return America to its toxic past may now accelerate with Trump's subsequent nomination of Michael Dourson to run the EPA's entire chemical safety program. Dourson has made a career as a hired gun for the chemical industry, helping clients play down concerns over toxic chemicals with known and potentially severe health effects. If confirmed to the top job at the EPA's Office of Chemical Safety and Pollution Prevention, Dourson will be regulating his old industry friends. It's a pattern we keep seeing with Trump's administration as the president and his appointees turn the federal government's mission to protect public health on its head.
EPA plans carbon rule replacement - EPA plans to take the first step toward replacing the Clean Power Plan by the first week of October as it publishes its plan to rescind the Obama administration’s carbon limits for power plants, Pro’s Emily Holden reports. EPA Administrator Scott Pruitt had been averse to replacing the rule, and sources tell Emily that when OMB first began reviewing the Clean Power Plan withdrawal in June the agency did not have plans to replace it. The decision to signal the agency will write a replacement comes after months of lobbying from electric company executives and suggests Pruitt may not challenge the legal finding that EPA must regulate greenhouse gases. One likely approach to a new emissions regulation would focus on improving coal-plant efficiency, so generators make more power while burning less coal. The repeal-and-replace proposals come as patience was wearing thin at the D.C. Circuit, which has avoided issuing an opinion on the Clean Power Plan itself while EPA reconsidered the rule. In an August warning shot to EPA, judges said failing to propose a replacement meant the agency was avoiding a "statutory duty" to regulate carbon emissions, though it agreed to keep the case on ice through Oct. 7. EPA spokeswoman Liz Bowman said she "would not comment on proposals going through interagency review."
Citing cost drop, U.S. government shifts focus of solar funding (Reuters) - The cost of solar energy has hit a U.S. government target three years ahead of schedule, prompting the Energy Department to change the focus of its solar program to integrating higher levels of the renewable power technology with the power grid. The DOE’s SunShot Initiative, launched in 2011 by the administration of President Barack Obama, set a goal of reducing the price of utility-scale solar to 6 cents per kilowatt-hour by 2020. The cost at that time was about 28 cents per kwh. On Tuesday, DOE officials said its target has been met, largely due to a sharp drop in the cost of solar panels. Residential and commercial solar are about 90 percent of the way toward meeting their cost reduction targets. The next phase of the SunShot program will align research and development efforts with Secretary of Energy Rick Perry’s priorities of grid reliability and resilience, DOE said. Last month, a long-awaited report commissioned by Perry blamed cheap natural gas for the closure of baseload coal and nuclear plants, a trend it said was threatening grid reliability. New funding efforts aim to make solar, which depends on the sun’s rays to generate power, more reliable. The DOE said it will provide up to $62 million to support advances in concentrating solar power that can be stored or used in other applications when the sun is not shining. It will also spend up to $20 million to fund early-stage projects to advance electronics such as solar inverters that can help solar arrays communicate with the electric grid. “We will drive early-stage research to help make solar more of an on-demand energy resource, and less of a weather-dependent one,” Daniel Simmons, acting assistant secretary for the DOE’s Office of Energy Efficiency & Renewable Energy, said in a speech at the solar industry’s annual trade show in Las Vegas.
IEA Underreporting Solar & Wind Energy 3–4x Compared To Fossil Fuels - Wind and solar energy have for decades experienced exponential growth and employ millions of people, but according to the International Energy Agency (IEA) statistics, they still only constitute about 2% of the world energy supply. How can this be? The answer is well hidden in an error made in a 12-year-old Statistical Manual by the IEA and OECD. As wind and solar continue their growth, this will soon need to be changed. After correction, it will become apparent that wind and solar energy already contribute about three times more to the world’s energy supply than normally reported, and that the shift to renewable energy sources comes much sooner than many decision makers are aware of. When a solar power plant, coal power plant, and nuclear power plant all produce the same amount of electricity, one would think that energy statistics would consider these contributions to the world’s energy supply to be relatively similar. This is far from true. Both the nuclear power and coal power are counted threefold relative to the solar power plant, taking into account that about three units of coal or nuclear energy are needed to make one unit of power. A similar loss happens, of course, in a wind farm or solar park, but here the IEA statistics do not make any correction to take into account everything that has been lost. The IEA merely reports the one unit of power produced and neglects that there were also about two units of energy lost in these renewable power plants. Consequently, the IEA ends up reporting the world’s use of fossil fuels roughly threefold versus wind and solar, and the actual role of these renewable energy sources becomes greatly underestimated.
U.S. primary aluminum production remains low despite slow increase in prices -- Since January 2015, the production of primary aluminum in the United States has fallen by more than 50%. The United States consistently produced about 140,000 metric tons of aluminum each month until mid-2015, when output slowed significantly. Since April 2016, primary aluminum production has averaged around 60,000 metric tons per month, even as aluminum prices have slowly increased. Primary production of aluminum is more price-sensitive than secondary production of aluminum (i.e., recycling). In the U.S. Geological Survey’s monthly mineral industry survey for aluminum, the Midwest price is the typical benchmark for U.S. trade, and the London price is the typical benchmark for international trade. Although the recent downturn in U.S. primary production of aluminum was initially attributed to declining aluminum prices, the price of aluminum has nearly returned to early 2015 levels, while primary aluminum smelting levels remain relatively low. Several other factors have contributed to the recent decline in domestic primary aluminum production, including higher labor costs and the strength of the U.S. dollar. Primary aluminum production is extremely energy-intensive and uses electricity throughout the smelting operation. Plants have curtailed production rather than closing entirely. The downturn in domestic primary aluminum production is unlikely to reverse in the near future. Production curtailments allow producers to temporarily reduce operating costs while hoping for market conditions to improve. The high number of domestic plant curtailments in the previous five years likely indicates that aluminum production firms do not believe the market is going to return to profitable conditions soon. According to the U.S. Department of Energy’s Advanced Manufacturing Office, aluminum is the most energy-intensive major product produced in the United States, requiring about 45,000 British thermal units per pound of production (Btu/lb). Production of paper and paperboard products (the second most energy-intensive industry) uses about 16,000 Btu/lb.
Hackers Can Now Cause Blackouts On America's Electrical Grid, Report -- Hacking attacks over the last several months that targeted U.S. energy companies have been able to gain "operational control" over systems, thus threatening blackouts across the U.S., says Symantec. The hacker group known as DragonFly 2.0 was able to gain control in at least 20 places, according to the firm. Wired:Symantec on Wednesday revealed a new campaign of attacks by a group it is calling Dragonfly 2.0, which it says targeted dozens of energy companies in the spring and summer of this year. In more than 20 cases, Symantec says the hackers successfully gained access to the target companies' networks. And at a handful of US power firms and at least one company in Turkey – none of which Symantec will name – their forensic analysis found that the hackers obtained what they call operational access: control of the interfaces power company engineers use to send actual commands to equipment like circuit breakers, giving them the ability to stop the flow of electricity into US homes and businesses. "There's a difference between being a step away from conducting sabotage and actually being in a position to conduct sabotage ... being able to flip the switch on power generation," says Eric Chien, a Symantec security analyst. "We're now talking about on-the-ground technical evidence this could happen in the US, and there's nothing left standing in the way except the motivation of some actor out in the world."
NASA: "Sun Erupts With Significant Flare" Around 12:06 p.m EDT on Sept 10, 2017, NASA’s Solar Dynamics Observatory captured an image of the sun unleashing a massive solar flare from a recently active region. Solar flares are powerful bursts of radiation. Harmful radiation from a flare cannot pass through Earth's atmosphere to physically affect humans on the ground, however — when intense enough — they can disturb the atmosphere in the layer where GPS and communications signals travel. Per NASA, This flare is classified as an X8.2-class flare. X-class denotes the most intense flares, while the number provides more information about its strength. An X2 is twice as intense as an X1, an X3 is three times as intense, etc. The X9.3 flare was the largest flare so far in the current solar cycle, the approximately 11-year-cycle during which the sun’s activity waxes and wanes. The current solar cycle began in December 2008, and is now decreasing in intensity and heading toward solar minimum. This is a phase when such eruptions on the sun are increasingly rare, but history has shown that they can nonetheless be intense. This flare is the capstone on a series of flares from Active Region 2673, which was identified on Aug. 29 and is currently rotating off the front of the sun as part of our star’s normal rotation. The flare was captured in the following NASA’s Goddard Space Flight Center video. NASA’s Solar Dynamics Observatory captured this image of the solar flare: More details: The National Oceanic and Atmospheric Administration signals X8.2 (R3-STRONG) X-RAY EVENT OBSERVED AT 10/1606 UTC. Primary areas impact includes ‘large portions of sunlit side of earth’. Possible effects include wide spread HF radio blackouts and navigation degradation through GPS (loss in signal). As SWL.com notes, "yesterday's X8.2 (R3-strong) solar flare from sunspot region 2673 was one of the most spectacular solar flares we have ever seen. Not only was this the second strongest solar flare of the current solar cycle, it also launched an extremely fast and broad coronal mass ejection:
US judge cites tribal sovereignty in dismissing coal lawsuit - A U.S. district judge cited tribal sovereignty in dismissing a lawsuit aimed at shutting down a coal-fired power plant and adjacent mine near the Arizona-New Mexico border. The lawsuit by environmental groups was targeting the 2015 approval by the U.S. government of a lease extension for the Navajo Mine and the Four Corners Power Plant, which has for decades provided electricity to customers throughout the Southwest. The groups argued that the Interior Department and other agencies did not consider clean-energy alternatives or possible effects on endangered species in the region when they approved the 25-year extension. In the order issued Monday, Judge Steven Logan of Phoenix tossed the case since the mine is owned by a corporation created by the Navajo Nation, which makes it immune from such legal challenges. The judge said the case could not move forward without the mine as a defendant. Navajo Transitional Energy Co. was allowed to intervene in the case last fall, citing its interest in the operation of the mine. The company argued that if the environmental groups were successful in their challenge, the tribe's solvency and economic development strategies could be jeopardized. The tribe created the company in 2013 for the purpose of purchasing the mine from BHP Billiton for $85 million through a three-year loan. The company obtained a new loan to pay off the original note and to maintain working capital. If mine operations were hampered, tribal officials were concerned the company could default on the loan and lose ownership of the mine, which would cost the Navajo Nation millions of dollars. The judge ruled that the tribal entity's interests in the outcome of the case far exceeded the federal government's interest in defending the validity of its environmental review and decision-making process.
Mexican Power plant closed a month after opening -- President Enrique Peña Nieto was in the Sonora municipality of Empalme just over three weeks ago for the inauguration of a sprawling (730M combined cycle) power generation facility operated by the Federal Electricity Commission (CFE). This week, the mayor shut it down. The municipality’s urban development and public works and services office found that construction permits for the site, issued in April 2015, expired last September, the project had no land use permits for the installation of transmission lines and the 2016-2017 environmental license was not renewed in time. So yesterday morning an 80-strong municipal police deployment prevented over 3,000 CFE employees from entering the facility. Last month, the El Cochorit plant was lauded by both the president and the governor of Sonora, who agreed that the state had the potential to attract even more investments in the power generation industry. The entire El Cochorit facility represents an investment of 33 billion pesos (US $1.9 billion). The facility includes the Agua Prieta I and II combined cycle plants and the Puerto Libertad thermal power station, already in operation.After the ceremony, the trial runs for the Empalme I combined cycle plant began, along with the groundbreaking of a similar plant known as Empalme II. The entire El Cochorit facility represents an investment of 33 billion pesos (US $1.9 billion) and will provide power to 12 million people.
Record drop in Australia’s electricity emissions cancelled out by rises in other sectors -- Emissions from the electricity sector in the three months to June dropped by the biggest amount on record, as the effect of the Hazelwood coal-fired power station closure is seen for the first time in quarterly projections produced exclusively for the Guardian.But even that drop wasn’t enough to stop Australia’s overall greenhouse gas emissions from continuing to rise. Emissions from almost every other sector – industrial energy, transport, industrial heat and agriculture – all rose. They are the highest levels seen since before the carbon tax was repealed, according to projections by consultants at Ndevr Environmental. The results mean Australia has now consumed 24% of its carbon budget set by the government’s Climate Change Authority – the total amount of carbon it can release from 2013 while doing its fair share to keep global warming under 2C. Once a certain amount of carbon goes into the atmosphere, warming over 2C will be inevitable. The report replicates the government’s methodology for its National Greenhouse Gas Inventory quarterly reports, which the government traditionally delays releasing for up to nine months, and has in the past saved up and released quietly in a batch just before Christmas.Australia’s overall greenhouse gas emissions over the year to June 2017 were the highest since 2011, with emissions rising steadily since the carbon tax was repealed in 2014.The most recent quarter – the three months to June 2017 – also had the highest emissions for any June quarter since 2011, rising to 3m tonnes more than the same quarter last year.
EIA projects 28% increase in world energy use by 2040 -- The U.S. Energy Information Administration's latest International Energy Outlook 2017 (IEO2017) projects that world energy consumption will grow by 28% between 2015 and 2040. Most of this growth is expected to come from countries that are not in the Organization for Economic Cooperation and Development (OECD), and especially in countries where demand is driven by strong economic growth, particularly in Asia. Non-OECD Asia (which includes China and India) accounts for more than 60% of the world's total increase in energy consumption from 2015 through 2040. Through 2040, the IEO2017 projects increased world consumption of marketed energy from all fuel sources, except for coal demand, which is projected to remain essentially flat. Renewables are expected to be the fastest-growing energy source, with consumption increasing by an average 2.3% per year between 2015 and 2040. The world’s second fastest-growing source of energy is projected to be nuclear power, with consumption increasing by 1.5% per year over that period. Even though IEO2017 expects the nonfossil fuels (renewables and nuclear) to grow faster than fossil fuels, fossil fuels still account for more than three-quarters of world energy consumption through 2040. Natural gas, which has a lower carbon intensity than coal and petroleum, is the fastest-growing fossil fuel in the outlook, with global natural gas consumption increasing by 1.4% per year. The relatively high rate of natural gas consumption growth is attributed to abundant natural gas resources and rising production—including supplies of tight gas, shale gas, and coalbed methane. Although liquid fuels—mostly petroleum-based—remain the largest energy source throughout the IEO2017 projections, the liquids share of world marketed energy consumption is projected to fall slightly, from 33% in 2015 to 31% in 2040. As oil prices rise, energy consumers are expected to turn to more energy-efficient technologies and switch away from liquid fuels where possible. Compared with the strong growth in coal use in the 2000s, global coal use remains flat in EIA’s international projection. Coal is increasingly replaced by natural gas, renewables, and—in China and a few other countries—nuclear power for electricity generation. Demand for coal in industrial processes is also expected to slow.
Merkel pledges a billion euros to help cities fight pollution from diesel cars - Chancellor Angela Merkel on Monday pledged a billion euros to help German cities fight air pollution caused by dirty diesel cars, as a scandal strangling the automobile industry threatened to engulf politicians at the height of the election campaign. Merkel said she was doubling financial aid to cities from a previously announced €500 million, in a bid to stave off the threat of an all-out ban against diesel vehicles. With elections looming on September 24th, Merkel and other politicians have a tight-rope to walk between balancing public health safety and securing millions of jobs in the vital automobile sector. While Merkel has often spoken of her long-term vision of a carbon-free economy run by climate friendly green technology, she made clear last week that, when it comes to the diesel issue, “this is 2017”. The immediate priority is to “prevent driving bans”, stressed Merkel, mindful she has to protect the crucial industrial sector whose global titans like VW, Audi, Mercedes and BMW earn billions of euros in exports and employ between 800,000 and 900,000 people.
Why Beijing’s plan to stop producing petrol and diesel cars could be a game-changer for the industry? | South China Morning Post: China is working on a timetable to stop production and sales of fossil-fuel vehicles as it races to develop new-energy vehicles and clear the country’s polluted skies, a senior Chinese industry official said on Saturday. Addressing a car forum in Tianjin, Xin Guobin, vice-minister of industry and information technology, said China was considering following in the footsteps of some European countries to phase out fossil-fuel cars. “Many countries have adjusted development strategies ... Some countries have worked out a timetable to stop production and sales of traditional-fuel vehicles,” Xin said. “Now the Ministry of Industry and Information Technology has launched a study as well, and will work with related departments on a timetable for our country”. The Netherlands and Norway have already set targets to ban fossil-fuel cars by 2025, with sales after that deadline limited to electric and plug-in hybrid vehicles.France also said on July 6 that it would ban sales of petrol and diesel vehicles by 2040 to reduce air pollution and become a carbon-neutral country by 2050. Britain made a similar announcement two weeks later. New-energy vehicles and batteries are key parts of Beijing’s plans to turn China into a hi-tech powerhouse in the next few decades. The National Development and Reform Commission, the country’s top planning agency, has also said it will not approve any new fossil-fuel car projects. Xin did not say when China would make the final decision on the plan. But he did admit the country faced an uphill battle to meet its targets of cutting carbon emissions per unit of GDP by 60 to 65 per cent by 2030, and making non-fossil fuels 20 per cent of primary energy consumption.
Pennsylvania coal production up by 20 percent from 2016 | TribLIVE: Pennsylvania continues to mine about a fifth more coal this year than it did last year, according to the Energy Information Administration's weekly coal production report. For the week that ended Sept. 9, the state's bituminous coal production for the year was up 20.4 percent from the same period last year, maintaining the gain it held throughout August. Bituminous coal production since January was 35.1 million short tons compared to 29.2 million tons produced by Sept. 9, 2016, according to the agency's data. Year-to-date production in the Eastern Pennsylvania anthracite fields also held steady at a 9.1 percent gain from the 2016 totals. The region had mined 1.2 million tons as of Sept. 9 compared to 1.1 million in 2016. National coal production for the year was 548 million short tons as of last week, a 13.5 percent increase from the same period in 2016.
EPA to reconsider coal ash waste regulations for power plants (Reuters) - The U.S. Environmental Protection Agency on Thursday said it will reconsider a rule regulating coal ash waste from power plants in a win for utility industry groups that petitioned for changes. The EPA, the lead environmental regulator in the United States, said it will reconsider specific provisions of the coal ash rule that took effect in 2015 that regulates how power plants manage and dispose of coal ash in waste pits. The EPA said it is in the “public’s interest to reconsider specific provisions” of the regulation and figure out how to amend it to give states more leeway in how they tailor their permit programs to comply with the rule. “EPA is not committing to changing any part of the rule, or agreeing with the merits of the petition – the Agency is simply granting petitions to reconsider specific provisions,” the EPA said in a press release. Environmental groups warned that if EPA rolls back the safeguards, it would put the public at risk because coal ash pits are located near waterways and groundwater. The Sierra Club said in a press release the move was “widely considered to be a ploy to scrap the protections entirely.” The petitioners, the Utility Solid Waste Activities Group (USWAG) and AES Puerto Rico LLP, are Washington-based groups representing power companies. USWAG argued in its petition the rules should be changed because a new law enacted after they were put in place made them unduly burdensome. It gives states the authority to police utilities disposing of coal ash waste, but the EPA rule currently prevents authorities from customizing its application.
Australian Newcastle coal prices hit 2017-high on strong Asian demand (Reuters) - Australian coal cargo prices for export from its Newcastle terminal hit a 2017-high of $103.5 per tonne at their last close, driven by strong Asian demand. The Newcastle free-on-board (FOB) contract is seen as a benchmark for Asian thermal coal prices. In particular, robust demand is coming from China, the world’s top consumer, where August imports rose to 25.27 million tonnes, their highest since December last year, reflecting increasing appetite from power companies as they build stocks ahead of winter. “The market was ... buoyed by the China customs data, which saw imports in August rise,” ANZ bank said in a note to clients. Demand from Japan is also strong, traders said. “Coal demand from northern Asia is generally pretty strong at the moment. There have also been some loading delays in Indonesia recently, so that’s further spurred demand for replacement cargoes from Australia,” said one coal shipper. He declined to be identified as he was not authorised to speak with media. Asian demand for coal from Australia is depriving domestic power generators of fuel and driving electricity prices higher. The strong physical market in Asia also showed in financial trading, where benchmark API2 year-ahead coal futures this week hit their highest level since May 2014, at $81.45 a tonne.
China's Hebei vows coal curbs ahead of winter smog war (Reuters) - Hebei, China’s smoggiest province, on Friday said it would ensure it meets its targets to replace coal with natural gas, while accelerating efforts to achieve politically crucial 2017 air quality targets. The local government said on its official website on Friday that it would ensure as many as 1.8 million households completed the switch to gas from coal for fuel and heating by the end of next month, despite concerns in the province that the transition was proving too costly and difficult. The step is part of efforts to cut annual provincial coal consumption by more than 6 million tonnes. Hebei, which surrounds the capital Beijing, is on the frontline of a “war on pollution” launched in 2014. It plans to wage an “iron-fisted” campaign against smog this winter, provincial governor Xu Qin said this week. As part of a central government push to fight smog this winter, Hebei plans to reduce small breathable smog particles known as PM2.5 by 15 percent from October 2017 to March 2018, but some major cities will be forced to make even deeper cuts. Tangshan, China’s top steel producing city, is under pressure to slash PM2.5 averages by more than 22 percent over the six months. It has promised to shut down polluting sectors like ceramics, cement and brickmaking once China’s winter heating systems are switched on in November.
UK coal use drops to 135-year low - Once the engine of the Industrial Revolution rooted in the UK, coal is now less popular than ever as an electricity source.According to Aurora Research, the fossil fuel contributed just 2% of total power generated in Britain in July. That's half the amount of coal used in the same month last year. For the whole of last year, coal use accounted for 9% of the total, versus 23% in 2015.In April the UK ran a whole day without coal, a statistic often cited by anti-coal campaigners as a sign the fossil fuel's days are numbered.“The decline in coal in recent years is partly as a result of higher carbon prices, and partly the growth in renewables,” Richard Howard, Aurora Energy’s head of research, was quoted in The Independent. ”In August coal load factors have been even lower than in July and the trend is continuing.”The UK government has said it plans to cut coal use entirely by shutting down all coal-fired plants by 2025.The closure of coal mines, including the last British underground coal mine in 2015, has meant a dramatic fall in greenhouse gas emissions for the island nation.According to Carbon Brief, an energy and climate science website, with the use of British coal used for electricity at record lows, carbon emissions in 2016 were about 381 million tonnes. New Scientist points out that with greenhouse gas escapes dropping almost 6% in 2016, the UK's carbon pollution is at its lowest level since 1894. New Scientist names cheaper natural gas, a hike in carbon taxes, expansion of renewable energy, less demand for overall energy, and the closure of Redcar steelworks in late 2015, as all factors resulting in cleaner air. Although, it points out that carbon from natural gas use rose 12.5%, and emissions from oil increased 1.6% due to lower gasoline prices, in 2016.
Coal's problem is not climate change (Reuters) - U.S. coal companies blame climate campaigners and the Obama administration for waging a war on coal that has cost thousands of jobs and threatened struggling mining communities. But coal’s long-term problems stem not from politics but from physical properties that make it an inferior source of energy compared with oil, gas and (arguably) renewables. Coal has been losing the “war” for market share since the middle of the 20th century as other sources of energy have become cheaper and more abundant. Rising energy consumption in advanced economies and emerging markets masked coal’s relative decline in the second half of the 20th century and first decade of the 21st. Consumption has continued to grow in poorer countries, where coal has played a crucial role in making electricity available for the first time to hundreds of millions of households.But the same problems that ensured coal’s replacement in the advanced economies will gradually lead to its replacement in emerging markets as well. Coal’s displacement by other sources of energy is part of a “grand energy transition” that has seen the dominant energy source shift successively from wood to charcoal, coal and oil. The precise dates vary slightly from country to country, but coal started to become an important source of energy on a global scale just before 1850 (“Energy transitions: history, requirements, prospects", Smil, 2010). Traditional biofuels such as wood and corn stalks continued to dominate the global energy system until 1900, when they were finally overtaken in importance by fast-growing coal consumption. Coal remained the dominant energy source until the 1960s, when it was overtaken by oil (“Global primary energy consumption, 1800-2015”, Our World in Data, 2017). But in recent years, natural gas consumption has been growing faster, and gas is set to overtake oil as the single largest source of primary energy within the next decade. Predicting transitions beyond natural gas is fraught with uncertainty but climate campaigners hope the global energy system will shift from gas to wind and solar.
India, climate change and nuclear power: the denials, delusions and deceptions of Modi - An intriguing display of extreme opposites can be seen when it comes to Indian Prime Minister Narendra Modi’s policy on climate change. His brazen denial of climate change, during a patronising address to young students in 2014 where he claimed, “it’s not the climate, but we who are changing”, came under heavy criticism. However, at the Paris Summit in 2015, Modi adopted a strongly assertive posture against the West from a developing world perspective, which understandably resonated with some sections of international civil society, but actually meant garnering more concessions for the home-grown industries. In his most recent trip to France this June, Modi was seen expressing concern about Trump’s exit from the Paris climate accord and reassuring the new French President of reinforced support from India. In terms of actual policies back home, the Modi government has been hugely scaling up the renewable sector, but has also made an unwavering support for nuclear power, purportedly as a solution for climate change! Such doublespeak and confusing signalling is not unusual for the Indian Prime Minister. He has a penchant for employing catchy acronyms as well as making grand, but hollow and often contradictory announcements. Opponents and even former colleagues have often accused him of reducing every policy decision into headlines-management. How do we then make sense of India’s course under Modi and what it entails for the climate, and the communities for whom these policies will have far-reaching implications and consequences? India is one of the few countries in the post-Fukushima world to have massive nuclear expansion plans. Official claims say this is based on the country’s growing energy requirements and the need to provide electricity to India’s poor population who continue to live in dark.
World’s Largest Nuclear Power Plant One Step Closer To Operation -- The Kashiwasaki-Kariwa nuclear power plant, the world’s largest, may get clearance to resume operations after six years of dormancy following the Fukushima disaster. The Japanese Nuclear Regulation Authority (NRA) granted the plant’s operator, Tepco, a qualified approval of its safety plan, and it could grant it effective approval as early as next week.While the watchdog could issue a formal approval for Kashiwasaki-Kariwa’s restart later this fall, according to the Nikkei Asian Review, the actual resumption of the reactors is questionable: there is strong local community opposition to nuclear power as fears of another meltdown still linger.Regulators have conducted technical safety evaluations of the plant, whose reactors are of the same kind as those that melted down in Fukushima, but there are still some reservations regarding Tepco’s safety efforts. The NRA has requested that Tepco’s proposed safety measures for Kashiwasaki-Kariwa be made more legally binding, and has set up a panel to devise ways to guarantee the utility keeps its word. Even if the NRA approves the restart of the plant, however, the Niigata prefecture is unlikely to support it with an approval of its own. The governor, Ryuchi Yoneyama, is an outspoken opponent of nuclear power, and following the news of NRA’s pending approval said that the prefecture had "absolutely no intention of approving a restart" of the Kashiwasaki-Kariwa facility before an safety inspection of Fukushima was completed.
Ohio gas plant developers primed to seize King Coal's crown — Where most people traveling south from this small southeast Ohio village see grassy fields and rolling hills alongside Interstate 77, Michael King sees the future of Eastern power markets. King, managing partner of Apex Power Group LLC, is particularly fixed on 118 acres across the I-77 from a highway rest stop. The empty field happens to be adjacent to the Rockies Express natural gas pipeline transporting Appalachian shale gas to points east and a high-voltage line moving electricity across the Mid-Atlantic. He figures the spot is perfect for a new $1.45 billion power plant that will run on gas from the Marcellus and Utica shale formations that underlie the area. The 1,650-megawatt Guernsey Power Station is the largest of almost a dozen of this new breed of power plants being developed across Ohio these days, a number that includes the recently completed Oregon Clean Energy Center, an 870-MW plant outside of Toledo. Together, the plants represent about $10 billion of investment in new generating capacity that will power millions of Ohio homes and, not coincidentally, ratchet up the pressure on aging coal and nuclear plants in the region. The wave of development is occurring against the backdrop of relentless lobbying by utilities seeking millions of dollars in subsidies to prop up those same plants, which are struggling to compete in a new world of cheap shale gas and eroding electricity demand (Energywire, Nov. 7, 2016).
ETP's Rover pipeline sends more Marcellus / Utica shale gas west - In another key milestone for Northeast pipeline takeaway capacity expansions, Energy Transfer Partners’ beleaguered Rover Pipeline project began partial service on its Phase 1A portion on gas day September 1. The 3.25-Bcf/d project, which is due for completion in early 2018, is expected to provide relief for constrained Northeast producers while exacerbating oversupply conditions and gas-on-gas competition in the Dawn, Ontario, storage and demand market area and surrounding region. Within days of initial start-up, flows on Rover ramped up to 700 MMcf/d, and both Ohio and overall Northeast production already have posted record highs since then as a result. Today, we take a look at the project, including initial flows and the expected timing of full completion. It’s been a long, tumultuous road for ETP’s Rover Pipeline project so far. From its inception, the project was competing head-to-head for shipper commitments and investment dollars against the DTE Energy Co./Enbridge 1.5-Bcf/d NEXUS Gas Transmission project which would begin in the same general gas-supply area (eastern Ohio) and serve the same general markets (southeastern Michigan and Ontario). Then, in late 2016/early 2017, ETP found itself racing against the clock to secure its final certificate of approval and finish clearing trees along the project route before some endangered bats — yes, bats — came to roost (see Bat Out of Hell). The developer managed to beat the clock on that, with the Federal Energy Regulatory Commission (FERC) issuing the certificate in early February 2017, just one day before the departure of Commissioner Norman Bay broke the quorum needed to get that final approval. With the certificate in hand, Rover construction proceeded at break-neck speed, and for a while the project seemed unshakable — that is, until disaster struck in May 2017 in the form of a two-million gallon spill of fluid containing diesel in a protected wetland area near the Tuscarawas River in Stark County, OH, which prompted FERC to issue an order halting any new Rover-related drilling activity pending a third-party review.
West Virginia officials to re-examine controversial pipeline | TheHill: West Virginia environmental officials are planning to take a new look at a natural gas pipeline that they previously approved amid national controversy. The state’s Department of Environmental Protection last week withdrew approval for the Mountain Valley pipeline. The agency told a federal court Wednesday that the information it used to approve the project “needs to be further evaluated and possibly enhanced.”Specifically, the agency wants to take a new look at how the pipeline proposed by EQT Corp. complies with West Virginia’s “antidegradation” policy, which seeks to prevent or mitigate environmental degradation. Wednesday’s filing was in response to a federal lawsuit that the Sierra Club and other environmental groups filed against the pipeline. The state agency asked the court to kick the issue back to the agency for its new review. The Sierra Club cheered the development. “Our rivers and streams make West Virginia a beautiful place for residents and visitors alike and preserving them also preserves what we love about our state,” said Justin Raines, chairman of the Sierra Club’s natural gas committee in West Virginia. “The fracked gas Mountain Valley Pipeline is dirty, dangerous and needlessly endangers West Virginia’s waterways, wilderness, and communities, and it should be rejected.”
West Virginia files to revoke permits for a massive natural gas pipeline - The West Virginia Department of Environmental Protection filed a motion Wednesday to withdraw its certification of water protection for the Mountain Valley Pipeline (MVP), a 300-mile long natural gas pipeline running from West Virginia to southern Virginia. The move came just a day before the state was due to defend its approval in court against a lawsuit from Appalachian Mountain Advocates, representing a number of local and environmental groups. The groups challenged DEP’s process in granting a Clean Water Act permit, known as a 401 certification. (While the Clean Water Act is a federal statute, many states are authorized to enforce its regulations.) “We’re pleased that DEP recognized its 401 certification was defective,” said senior attorney Derek Teaney. “But it’s a shame that it took a lawsuit to get DEP to do its job.” Section 401 of the Clean Water Act requires the state to certify that a project will not violate water quality standards — including making sure that existing streams and rivers won’t be degraded. The Mountain Valley Pipeline route will cross over 600 local streams, Teaney told ThinkProgress. During construction, the streams would be dammed before the company digs a trench, buries the pipe, and allows the water to flow again. After the pipeline is complete, it will remain in a “maintained pipeline corridor,” which will increase runoff and sediment. “Amazingly, neither DEP nor MVP bothered to calculate how much sediment the affected streams could tolerate or how much the pipeline would add to them,” Teaney said. “DEP never did that analysis the first time around. It didn’t even have the data necessary — baseline water quality data and a quantification of the amount of new pollution from the pipeline — to do that review.” According to the motion, filed with the United States Court of Appeals for the Fourth Circuit, West Virginia agrees that its review was insufficient. “During its review of the [court] filings… DEP determined that the information used to issue the Section 401 Certification needs to be further evaluated and possibly enhanced,” it says in the motion. The DEP specifically noted that “it needs to reconsider its antidegradation analysis.” The stiff language belies the damage the Mountain Valley Pipeline could do. According to an environmental impact statement, the project “would be located in 13 major watersheds.” The route crosses more than 1,100 waterways, including five “major bodies.” Moreover, 152 miles (all but 44 miles) of the pipeline route in that state “were identified as having a high incidence of and high susceptibility for landslides.”
How a Recent Court Ruling Could Impede New Gas Pipelines - A federal appellate court decision has set back the approval of a newly completed set of natural gas pipelines in the U.S. Southeast, and raised the possibility that all gas pipeline projects will need to clear a new — and potentially challenging — hurdle before they can secure a final OK from the Federal Energy Regulatory Commission (FERC). In its late-August ruling in Sierra Club, et al vs. FERC, the U.S. Court of Appeals for the District of Columbia Circuit said FERC’s environmental impact statement for the Southeast Market Pipelines Project, which includes the 1.1-Bcf/d Sabal Trail pipeline from west-central Alabama to central Florida, should have considered greenhouse gas emissions from gas-fired power plants the new pipelines will serve. Today, we explore the potentially far-reaching effect of the decision on midstream companies and the utilities that depend on them. The abundant supplies of U.S. natural gas made possible by the Shale Revolution — and the relatively low and stable gas pricing that came with that abundance — have played a significant role in reducing the volume of carbon dioxide (CO2) and other greenhouse gases (GHGs) emitted by the electric power industry. As shale-gas production increased over the past 10 years, electric utilities and independent power companies have scrapped their plans for new coal plants, retired scores of existing coal units and built dozens of new gas-fired plants (most of them highly efficient and operationally flexible combined-cycle facilities). Additionally, as abundant, low-cost gas supplies flooded the market (causing prices to drop), gas began beating coal economically for day-to-day generation. The net effect of this shift from coal to natural gas as the U.S.’s leading power plant fuel — plus the addition of new wind farms and solar facilities — has been a more than 20% decline in GHG emissions by the power sector since 2007. (The coal-to-gas shift has also helped to slash emissions of sulfur dioxide, mercury and other pollutants.)
Inspections show Line 5 coating gaps larger than disclosed - - Patches of bare metal larger than dinner plates are visible in photos of protective coating gaps on Enbridge Line 5 submitted to the state of Michigan this weekend. The photos are part of an initial report demanded by state officials who have noticeably soured on the controversial oil pipeline under the Straits of Mackinac.Seven pipeline "holidays," or areas of external anti-corrosion coating loss, are detailed in inspection documents sent to the state on Friday, Sept. 8, and obtained by MLive. Several holidays are larger than the "Band-Aid"-sized areas Enbridge initially described when the gaps were revealed. The largest patch of exposed pipeline metal is 16 inches long and 10 inches wide. Others are narrower but also exceed a foot in length. Also detailed in the reports is a "disturbed" coating area that's more than 3 feet long, a "dislodged" coating area that's 13 feet long and a mysterious 8-inch "white deposit" of unknown origin that Enbridge says "remains under investigation." The coating damage is the latest tough news for Line 5 this year, and some pipeline opponents think the angry response from Michigan officials signals intent to finally force the line's closure, a move that fossil fuel industry groups would likely oppose. Michigan officials were quick to demand repairs when the coating gaps were disclosed -- another surprise for regulators conducting a high-profile Line 5 public review that has thus far culminated in a roundly criticized independent report on feasible alternatives to Enbridge's continued operation of an unpopular pipeline. The news follows revelations that Enbridge was previously violating its easement for years by failing to properly support long spans on the line with anchors, which the company is presently seeking a state permit to install 22 more of this fall. Some of those anchors are in an area where inspections show the pipeline is bent and deformed. Line 5 is bent and deformed where Enbridge wants to anchor it The extent of coating failures, according to the Michigan Department of Environmental Quality, is troubling to the state, which was assured by Enbridge this spring that no areas of bare metal exposed to lake water existed on the pipeline after a federal work plan to investigate holidays surfaced in Chicago. When the external coating gaps were confirmed in August, Enbridge said there were only "two, possibly three" spots that were about 3 inches or so.
DRBC Acts to Ban Fracking in Delaware River Basin - NJ Spotlight: The Delaware River Basin Commission is initiating a process that could ban drilling and hydraulic fracturing for natural gas within the basin, the source of drinking water for 15 million people in four states. In a notice issued yesterday afternoon, the regulatory agency announced it would consider directing its staff to develop new regulations to address natural-gas development within the Delaware River Basin, including rules governing wastewater generated from drilling activities from outside the region. Natural-gas development is one of the more contentious environmental issues within the four-state region. Fracking — injecting huge quantities of water and some chemicals into rock formations to extract gas — has led to lower fuel costs for both consumers and businesses, as vast new supplies have been tapped in Pennsylvania and other states. Opposed to fracking But environmentalists and many communities oppose the practice, fearing it will contaminate drinking water. New York, one of four states on the commission, enacted a statewide ban on fracking last year. In moving to adopt new regulations, the DRBC is expected to initiate a rule-making process at a meeting tomorrow at Bucks Community College that would be published by the end of November. No drilling has occurred within the basin since the commission adopted a moratorium back in 2010. The moratorium was enacted to give time to adopt regulations governing drilling, but the commission never did so after some members balked. Environmental groups are happy the commission is moving to ban fracking within the basin, but were taken aback by the concurrent decision to consider adopting regulations for storage, treatment, and disposal of fracking wastewater within the region. They also oppose any effort to allow water withdrawals from the basin for natural gas drilling elsewhere. “We want a total ban on fracking from start to go,’’ said Maya van Rossum, Delaware Riverkeeper. “If you want to protect the watershed, you have to ban the entire process.’’
Regulators take step to ban fracking near Delaware River (AP) -- A commission that oversees drinking water quality for 15 million people took an initial step Wednesday to permanently ban drilling and hydraulic fracturing near the Delaware River and its tributaries, drawing criticism from the natural gas industry as well as from environmental groups worried that regulators would still allow the disposal of toxic drilling wastewater inside the area. The Delaware River Basin Commission, which oversees the river's water quality in Delaware, New York and Pennsylvania, voted 3-1, with one abstention, to begin the lengthy process of enacting a formal ban on drilling and fracking, the technique that's spurred a U.S. production boom in shale gas and oil. The watershed supplies Philadelphia and half of New York City with drinking water. The resolution approved by the commission says that fracking "presents risks, vulnerabilities and impacts to surface and ground water resources across the country," and directs the staff to draft regulations to ban it. Representatives of the governors of New York, Pennsylvania and Delaware voted for the measure. New Jersey's representative abstained and the federal government representative voted "no," drawing lusty boos from a strongly anti-fracking crowd attending the meeting outside Philadelphia. New York banned horizontal drilling and hydraulic fracturing statewide in 2015. Commissioner Mark Klotz, representing Democratic New York Gov. Andrew Cuomo, said the state is "strongly supportive of the resolution." Delaware's representative, Kara Coats, likewise expressed support. None of the other commissioners commented.Environmentalists were infuriated by provisions they said would allow the industry to draw water from the river and its tributaries for hydraulic fracturing outside the region, and to dispose of fracking wastewater within the Delaware watershed. "The frackers get our clean water and we get a Superfund site back. It’s a wolf in sheep’s clothing. This is not a deal that we should be making," Jeff Tittel, director of the New Jersey Sierra Club, told commissioners.
Twist in proposed Delaware River Basin fracking ban angers environmentalists -- A new proposal may permanently ban hydraulic fracturing within the massive Delaware River Basin, but not the disposal of waste from the process used to drill for natural gas, officials and environmental groups said Monday. The Delaware River Basin Commission announced a procedural vote is set for Wednesday on the new natural gas development draft regulations. The vote happening in Bucks County would pave the way for opening public comment until Nov. 30 on the proposal. "If the proposed resolution is approved by the commission on Sept. 13, the revised draft rules to be published on a later date would include prohibitions related to the production of natural gas utilizing horizontal drilling and hydraulic fracturing within the Delaware River Basin," the commission said in a statement. "The revised draft regulations would also include provisions for ensuring the safe and protective storage, treatment, disposal or discharge of hydraulic fracturing-related wastewater where permitted and provide for the regulation of inter-basin transfers of water and wastewater for purposes of natural gas development where permitted," the statement continued. The commission is a federal-state governmental agency responsible for managing water resources within the 13,359-square-mile Delaware River Basin that spans parts of Pennsylvania, New Jersey, New York and Delaware. Hydraulic fracturing, or fracking, is a process in which sand, water and chemicals are injected at high pressure deep underground to release natural gas. It's been used for years to draw the commodity from the Marcellus Shale geological formation underlying parts of Pennsylvania. The wastewater that is also generated can contain contaminants from the process and even radioactive elements brought up from beneath the surface. The basin commission's proposal to permit its disposal within the basin isn't sitting well with groups like the New Jersey Sierra Club.
Delaware, New York, Pennsylvania ban fracking in Delaware River Basin - - The governors of Delaware, New York and Pennsylvania, comprising a majority of the Delaware River Basin Commission, announced Sept. 13 they had voted in favor of a resolution put forward by the commission to issue draft regulations to permanently ban hydraulic fracturing for oil and gas in the Delaware River Basin. The DRBC vote was 3-to-1 with one abstention in passing the resolution for promulgating regulations that would prohibit any water project in the Delaware River Basin proposed for developing oil and gas resources by high-volume hydraulic fracturing. Delaware Gov. John Carney said that the DRBC resolution is consistent with the Delaware River Basin Conservation Act, a bill introduced by Carney and passed by Congress in 2016, by helping to ensure that the water resources of the basin will be protected for present and future generations. The Delaware River Basin, which drains from portions of New York, New Jersey, Pennsylvania, and Delaware, supplies drinking water to more than 15 million people. Governors of the four basin states and a federal representative serve as DRBC, tasked with overseeing a unified approach to managing the river system without regard to political boundaries. The commission has oversight in the basin for water quality protection, water supply allocation, regulatory review, water conservation initiatives, watershed planning, drought management, flood loss reduction and recreation.
Brooklyn considers fracking waste rule - — The Board of Selectmen thinks it may be time to put forward an ordinance to deal with petroleum fracking waste.The Conservation Commission asked the board to deal with the issue in the winter, but the board held off at the time. The state Department of Energy and Environmental Protection was looking at the issue at the time.“We need to take a hard look at this now,” said First Selectman Rick Ives. “I’m not sure DEEP is going to take care of this.”Petroleum fracking is a controversial practice. It involves drilling down a mile or more and then drilling horizontally several thousand more feet to create multiple wells. The wells are then pumped with a high-pressure mix of water, sand and additive to create micro-fractures in the rock. It’s the additives that concerns opponents most and it is the water, sand and additives that constitute fracking waste.According to the Natural Resource Defense Council, fracking directly poses a hazard to water, air and soil quality and diminishes the health of the communities it is based in. Proponents of fracking, however, claim it is a safe and cost-effective way to collect natural gas. Conservation Commission member Jeannine Noel attended a fracking waste workshop and said the practice occurs in about 30 states. It’s not fracking, but the byproducts the commission is most concerned about.
North Carolina delays decision on Atlantic Coast Pipeline - Faced with a Monday deadline and a lopsided number of public comments opposing the Atlantic Coast Pipeline, North Carolina Gov. Roy Cooper’s administration has delayed until mid-December its decision on whether to permit the controversial project.Without fanfare or press release late yesterday, the state issued a four-page “request for additional information,” part of its duty under the federal Clean Water Act to ensure the natural gas pipeline won’t harm the over 320 rivers and streams and hundreds of acres of wetlands in its path.Pipeline foes hailed the action, which appeared to vindicate a critique they’ve been leveling for months against the project, slated to hug the state’s I-95 corridor and pass through eight eastern North Carolina counties.“The current application leaves out critical information,” said Geoff Gisler, an attorney with the Southern Environmental Law Center. “There are literally hundreds of streams and wetlands that the company has asked to dig through with hardly any analysis.”The delay followed a series of rowdy hearings and meetings last month that were packed with pipeline opponents, and the receipt of over 9,000 written public comments – 85 percent urging rejection. “That’s an incredible number,” said Gisler. “That’s something you’d expect to see in a federal rule making that covers the whole country.”
Natural Gas Factbox: Southeastern US gas demand remains below pre-storm levels -- The US natural gas industry on Thursday continued to recover from the impacts of hurricanes Harvey and Irma, which struck the country's western and eastern Gulf coasts in a span of a few short weeks.Demand for gas from the power generation sector continued to lag behind pre-storm levels, especially in Florida and the rest of the southeastern US, as crews worked to restore electricity service to regions hard hit by Irma, while most interstate gas pipelines and gas utility companies reported only minimal disruptions to service as a result of the two storms.* Gas demand from the southeastern US power generation sector increased 554 MMcf day on day to 8.1 Bcf Thursday, some 679 MMcf below the September pre-storm average, according to data from Platts Analytics' Bentek Energy unit. This has driven total demand in the region up to 18.1 Bcf. * Demand from Florida generators increased another 127 MMcf to 3.4 Bcf Thursday. Throughput on the Florida Gas Transmission segment that feeds such demand has reached pre-storm levels, and volumes on the other main pipeline feeding the area, Gulfstream Natural Gas System, reached 929 MMcf, some 190 MMcf shy of the pre-storm average.* Deliveries from Transcontinental Gas Pipeline onto Sabal Trail Transmission Pipe Line remained about 250 MMcf/d below where they were prior to Irma and may not return to normal levels until the Florida power sample completely recovers, according to Platts Analytics.
Gas Shortages in Florida Reveal a Fragile Supply Chain -- In Gainesville, some 45 percent of gas stations are running dry as of Wednesday. In West Palm Beach, it’s 50 percent. And the price of gas has jumped nearly 30 cents on average—and that’s without the widespread price gouging that plagued Florida this past weekend. These are the tough realities Floridians who evacuated in the face of Hurricane Irma last week even as they begin to return home. An unprecedented six million fled from the Category 5 storm, the largest evacuation in U.S. history. The exodus created widespread gas shortages in the days before landfall, with the majority of South Florida gas stations dry by Thursday. Disabled and abandoned vehicles dotted northbound routes. It was a situation that paralyzed many Floridians who wanted to evacuate, as I found when I called several residents weighing their options. “They knew the hurricane was coming, but where was the backup gas?” a West Palm Beach woman named Adrienne Beauchamp wondered to me the same day. “Why wasn’t Florida more prepared?” I took her question and others to fuel experts. A car-dependent state with a history of hurricanes, Florida had a week before Irma hit to lay in enough fuel for residents to drive out of harm’s way—the choice mode of evacuation. Unlike states with more shared borders and freight infrastructure, roughly 97 percent of the refined fuel sold in Florida gets shipped in, from the Gulf of Mexico. Much of it usually come from refineries on the shores of Texas—which were devastated just weeks ago by the second-costliest storm in U.S. history, Hurricane Harvey. With Texas refineries knocked out of commission because of Harvey, Florida’s fuel suppliers were already feeling the squeeze before Irma’s path became clear. In fact, as of the week before Labor Day, according to Jim Storey, the business development director of the Georgia-based fuel distributor Mansfield Oil, Florida was trucking some of its own supplies over there to help out Texas. But as Irma predictions shaped up, the flow of fuel out-of-state was swiftly reversed.
Fuel cargoes line up as Florida's Port Everglades, Tampa set to reopen - Port Everglades on Florida's southeast coast and Port Tampa Bay on the west side are set to reopen Tuesday, allowing fuel cargoes to replenish supply drained by last week's massive evacuation for Hurricane Irma. Florida depends on tanker and barge shipments rather than pipelines for 97% of its refined products. Tampa receives deliveries from Texas and Louisiana refineries, while Port Everglades receives deliveries from the East Coast. Port Tampa Bay expects to reopen at 2 pm Tuesday (1800 GMT), spokeswoman Samara Sodos said. Four oil vessels were waiting to unload Tuesday morning. Tampa fuel terminals reopened Monday, dispensing stored fuel on to tanker trucks. The US Coast Guard was completing surveys of Port Everglades' navigation channels early Tuesday before the reopening, the port authority said. At 8 am (1200 GMT), three petroleum tankers, two cargo ships and three cruise ships were waiting to enter. Five of the 12 oil terminals at Port Everglades were operating, loading fuel trucks to supply retail stations. The port authority expects five more terminals to reopen midday Tuesday. Two refined products vessels are scheduled to arrive in Tampa this week, according to cFlow, S&P Global Platts trade flow software. The tanker Florida and tanker Louisiana are both scheduled to arrive Wednesday and make regular runs between Louisiana and Florida. The West Virginia is due to arrive in Tampa on Thursday, having left the New York area eight days ago. Several other refined products vessels are scheduled to unload at Port Everglades this week, including the Mare Pacific on Tuesday, the Overseas Nikiski on Thursday and the Mt Sea Halcyone on Friday, according to cFlow.
Tankers: Jones Act waiver spurs flurry of vessel bookings on USGC/USAC-Florida run The seven-day Jones Act waiver announced Friday by the Department of Homeland Security in recognition of the severity of Hurricanes Harvey and Irma prompted a flurry of fixing activity for non-US flagged Medium Range tankers loading gasoline on the US Gulf Coast and Atlantic Coast to sail to Florida. The Jones Act requires vessels transporting goods between US ports to be US-flagged, US-built and majority US-owned. "There have not been any [Jones Act] ships to work with prior to Irma; ships have been snapped up [after Harvey]," a Jones Act tanker broker said. Port Everglades on Florida's southeast coast and Port Tampa Bay on the west side reopened Tuesday, allowing fuel cargoes to replenish supply drained by last week's massive evacuation for Hurricane Irma. The waiver permits non-US flagged vessels to deliver US products within points in the US from September 8-15 as a precautionary measure to ensure that there will be enough fuel to support life-saving efforts, respond to the storm, and restore critical services and critical infrastructure operations, according to DHS acting Secretary Elaine Duke. A total of 11-12 Jones Act-waivered vessels have been placed on subjects on the USGC/USAC-Florida run since Friday, but shipbrokers believed a minimum of six had already failed. "Because of the hurricane damage on the USGC, people can't get their hands on the product," a shipbroker said, alluding to reduced refining capacity and limited drafts at USGC ports.
Phillips 66 makes use of Jones Act waiver (Argus) — Independent refiner Phillips 66 says it has chartered a foreign-flagged tanker under a Jones Act waiver President Donald Trump's administration issued to relieve hurricane-related fuel shortages in the southeast US. The refiner said it used the waiver to charter the Nave Jupiter, which is flagged in the Marshall Islands. The tanker left Houston on 9 September and was docked near Phillips 66's 250,000 b/d Alliance refinery in Louisiana today, according to vessel tracking data. The company says it chartered the vessel this week but declined to provide further details. Phillips 66 was earlier heard fixing a New Orleans-Florida gasoline shipment on the Nave Jupiter, although the fixture counterparties were unconfirmed. The company previously requested a Jones Act waiver to supply crude to the Alliance refinery, but the company withdrew the request before the administration made a decision. Phillips 66 is the first company known to use the administration's Jones Act waiver, a law that requires shipments between domestic ports to occur on US-flagged, owned and crewed ships. US Homeland Security acting secretary Elaine Duke this week signed an order extending the waiver through 22 September, citing "severe disruptions" that Hurricane Harvey caused to the midstream and downstream sectors of the oil industry. The latest waiver creates an exemption for shipments of petroleum products to Florida, Georgia, South Carolina, North Carolina, Virginia, West Virginia and Puerto Rico, from ports in New York, New Jersey, Texas, Louisiana, Mississippi, Alabama and Arkansas.ExxonMobil subsidiary SeaRiver Maritime was the only other company to request a Jones Act waiver in the wake of Hurricane Harvey, which made landfall in Corpus Christi, Texas, last month. ExxonMobil declined to comment on whether it intended to use the waiver.
Hurricane Irma’s Wrath Weighs On Natural Gas - Hurricane Irma has left millions of people without power in Florida, a critical situation that could take a painfully long period of time to sort out. Estimates vary, but some 9 million people lost power during Hurricane Irma, according to the CEO of Florida Power & Light, the state’s largest utility. As of Monday, an additional 1 million people lost power in Georgia and South Carolina as the remains of Irma moved north. While most attention has been paid to how the hurricane would affect oil and gasoline markets, particularly after Hurricane Harvey devastated Gulf Coast refineries two weeks ago, the massive power outages could also result in some disruptions in other energy markets. For example, about two-thirds of Florida’s electricity is generated from natural gas, and the outages could cause a dip in natural gas consumption. Just like how millions of people not driving in their cars after the hurricane could lead to a temporary decline in gasoline consumption, the millions of people without power for a period of time could cause some natural gas supplies to build up. Florida’s natural gas demand “fell from 4.43 Bcf/d on 9/7 to 2.74 Bcf/d on Monday (Sept. 11), a drop of 1.69 Bcf/d,” according to Genscape Inc., reported on by Natural Gas Intelligence. Taken together, the gas demand in Florida, Georgia and South Carolina plunged by a third between Thursday and Sunday from 9.47 Bcf/d to 6.21 Bcf/d. Most of the reduction was because of the electricity outages. The U.S. natural gas market has been sleepy since the end of last winter, with prices stuck around the $3 per MMBtu mark. Gas inventories have tracked within the five-year range for the better part of a year, after the extraordinary buildup in 2015 and 2016. A dip in gas production last year helped erase a bit of the glut, and the market stabilized this year as output rebounded and kept pace with demand. Florida’s power outages probably won’t knock the markets off course, but they could lead to a sharper-than-average gain in inventories a few months ahead of the start of winter season.
LNG Glut May Flip to Deficit as Cheniere Sees China Growth (Bloomberg) -- The global glut plaguing liquefied natural gas markets may start to dwindle in five years, threatening to spur a deficit equivalent to twice the output of leading producer Qatar. New projects are needed to fill the shortfall, with demand for the super-chilled fuel forecast to double in the 20 years to 2035, Cedigaz, a Paris-based industry research group, said in its LNG Outlook. Buyers in Asia are boosting use of the fuel at a “staggering” pace, Jack Fusco, chief executive officer of U.S. exporter Cheniere Energy Inc., said in a Bloomberg Television interview. While plants currently in operation or being built will add to global oversupply, aging facilities and shrinking resources in some areas mean capacity will start declining after 2021. That’s a boon for companies from Royal Dutch Shell Plc to Tellurian Inc. and Novatek PJSC looking to invest in new production in the next decade to meet demand. “The continuous growth of the LNG market will leave a large margin for the implementation of new projects,” Cedigaz said in the report emailed Thursday. The U.S. shale boom will make the country the biggest LNG producer by the end of the period, according to the Cedigaz report. Output will end in some nations such as Trinidad and Tobago. “I foresee that the LNG market needs at least a hundred million tons of new liquefaction capacity above what’s under construction today in order to meet demand needs of the market by 2025,” . “Demand is growing more than people expected.” Global LNG capacity is expected to peak at 387 million tons a year by 2021-2022 from 288 million tons this year at existing or under-construction plants, Cedigaz said. Trinidad and Tobago, the world’s ninth-biggest producer, will stop production in 2029. The Atlantic LNG venture in the Caribbean nation has already curbed output and cut its workforce due to feed-gas shortages. Algeria, Indonesia, Malaysia and even Australia, which next year will add more capacity than any other nation, will see declines in output by the end of the next decade.
September crude imports at LOOP up 10% from average following Harvey - The Louisiana Offshore Oil Port continues to experience a surge in crude oil imports more than two weeks after Hurricane Harvey hit the Texas Gulf Coast and prevented ports in that state from receiving crude for days.The LOOP oil terminal has received 4.1 million barrels of crude in September through Sunday, or about 410,000 b/d, according to Platts Analytics and the latest US Customs data available. That is the highest volume of crude imported into LOOP over the first 10 days of a month since May. LOOP typically receives about 370,000 b/d of crude through the first decade of the month, Platts data shows. By comparison, the three Texas ports to have received crude in September so far — Houston, Corpus Christi and Texas City — have taken in 4.3 million barrels, or just 200,000 barrels more than LOOP alone. Valero and ExxonMobil each accounted for 1.6 million barrels of the LOOP total in September while Marathon imported 550,000 barrels and an as-yet-unknown consignee brought in a further 400,000 barrels.Harvey’s disruption appears to have led to an increase in sweet grades into LOOP as well. LOOP customers typically focus on sour crude imports. However, since Harvey made landfall, 544,000 barrels of Nigerian Bonga was imported August 28 on the tanker SKS Spey while 400,000 barrels of Bonga was imported on the same tanker September 6. Prior to late August, no West Africa crude had been imported into LOOP since January. The cost to store crude at LOOP also has increased. LOOP sells the right to store a blend called LOOP Sour on a monthly basis. On Friday, 245 capacity allocation contracts, or CACs, representing 245,000 barrels, were cleared on CME for October storage at 20 cents/b. That is 5 cents/b more than the price for September storage, based on data published by Matrix Markets, which hosts the auction on behalf of LOOP.
Six companies buy oil from SPR (Reuters) - Six companies bought 14 million barrels of oil from the U.S. Strategic Petroleum Reserve in a sale required by law to help fund medical research and the federal government, said the Department of Energy on Thursday. BP Oil Supply, Exxon Mobil Corp, Phillips 66, Shell Trading, Valero Marketing and Supply Company, and Macquarie Commodities Trading bought oil from the reserve, which is held in salt caverns on the Texas and Louisiana coasts. The companies bought the oil at a range from $46.98 to $47.91 a barrel, slightly below the current futures price of about $49.70 per barrel, depending on which location the crude came from and whether it was sent by pipeline or directly to vessels, which could export the petroleum.
Largest U.S. refinery restarts production after Harvey: sources (Reuters) - The largest U.S. refinery was restarting production on Monday for the first time since being shut nearly two weeks ago by Hurricane Harvey, said sources familiar with plant operations. Motiva Enterprises restored the 325,000 barrel per day (bpd) VPS-5 crude distillation unit at its 603,000 bpd Port Arthur, Texas, refinery to minimum production levels early in the day, the sources said. After bringing the VPS-5 online, Motiva began restarting the 105,000-bpd Hydrocracking Unit 2, the sources said. The HCU-2 is a lucrative source of motor fuel exports for Motiva. Motiva did not immediately reply to requests for comment about operations at the refinery, which has been shut since Aug. 30 due to flooding from Harvey. Last Thursday, the VPS-5, HCU-2 and the 110,000 bpd coking unit were ready to resume production after being placed on circulation in which the units were at operating temperatures and circulating feedstock, the sources said. However, Motiva had been waiting for adequate crude supply to be restored to the VPS-5 before restarting production, according to the sources. Motiva said last week the Port Arthur refinery would resume production at 40 percent capacity by Monday. Motiva did not give a timeline for fully restoring output.
Harvey’s flooding blamed in major gasoline spill in Texas (AP) Hurricane Harvey’s floodwaters triggered a spill of almost a half-million gallons of gasoline from two storage tanks along the Houston Ship Channel, marking the largest spill reported to date from a storm that slammed into the heart of Texas’ huge petrochemical industry.The spill measured 10,988 barrels, or more than 461,000 gallons, and occurred at a petroleum tank farm in Galena Park operated by Magellan Midstream Partners, according to the Oklahoma-based company and accident reports submitted to federal officials.Some of the spilled fuel flowed into a waterway adjacent to the ship channel, a heavily-industrialized area that’s lined with dozens of petrochemical facilities, the reports said.Gasoline is more volatile than oil, meaning it evaporates more quickly after it’s spilled. But it’s also more likely to catch fire and can more rapidly penetrate the soil and potentially contaminate groundwater supplies. Magellan spokesman Bruce Heine said the gasoline that reached the small, unnamed waterway had been contained. The spilled fuel was sprayed with foam to prevent it from releasing harmful vapors, he said.
Tankers: Texas ports open but draft restricted as lightering rates jump -- Lightering day rates have soared as draft restrictions along the Texas coastline keep fully-laden dirty products tankers from coming into ports seen still dredging silt in the wake of Hurricane Harvey."Delays are killing everyone ... there are no safe itineraries right now," a source said as ports and the US Army Corps of Engineers work to get storm-ravaged port facilities back to pre-storm activity levels. All Texas ports are open with restrictions in place. The Houston Ship Channel below the Sidney Sherman Bridge is open with draft restrictions.The entrance to the channel to Houston Cement West is open to vessels with 40 to 42 feet drafts, according to shipping operations sources. Platts Ocean Intelligence is the go-to source of credit and due diligence reports for companies in the shipping and bunker sectors, helping to make informed decision in the high-cost, high risk maritime world. What distinguishes us from the competition is that we leverage the deep resources of S&P Global which enables us to embed our intelligence on companies within a larger market context and provides our reports with more insight and perspective. The draft is restricted to 36 feet from Houston Cement West to the Sidney Sherman Bridge and movement is restricted to daylight only, one-way traffic for larger vessels with prior approval and coordination between Houston Pilots Association and the US Coast Guard Vessel Tracking Service. The Corps has finished surveys and is carrying out dredging in different areas, shipping operations sources said, as well as issuing a contract for removal of 10 obstructions along the channel. Authorities are focused on getting the channel back to its pre-storm level of a 46 foot draft, using the mean low water, sources said. Calculating draft for the ship channel is a tricky proposition as it is dependent on cargo density. "Mexican and Venezuelan crude might draft too much."
New Drill Down Report on Permian NGLs -- Natural gas liquids production in the Permian Basin has doubled in the past four years, and may well double again by 2022. That rapid growth — driven by the pursuit of Permian crude oil and the resulting production of large volumes of NGL-rich associated gas — threatens to overwhelm the region’s existing gas processing and NGL-pipeline infrastructure. This is a big deal, because if there’s not enough gas processing and NGL takeaway capacity out of the Permian, exploration and production companies (E&Ps) in the U.S.’s hottest shale play would be forced to slow the pace of their development. Today we discuss highlights from our new Drill Down Report on Permian NGL production growth and the need for more NGL-related infrastructure. One of the surer bets in an energy industry rife with uncertainty is that production of crude oil, natural gas and natural gas liquids (NGLs) in the Permian will continue rising. The hydrocarbon resources in the best parts of the Permian are extraordinary, and E&Ps active in the play have — after considerable effort — cracked the code to wringing vast volumes of crude and NGL-packed associated gas from new wells there at a remarkably low cost per barrel of oil equivalent (boe). But production growth can only occur if sufficient supporting infrastructure is in place to process and transport all the crude, gas and NGLs emerging from wellheads across the 70,000-square-mile Permian region.
Lawyers Return With Lawsuit Blaming Earthquakes In Oklahoma On Fracking - A lawsuit that blames the fracking industry for increased earthquake activity in Oklahoma is back.Class action attorneys who are targeting a group of natural gas companies will now ask a federal court to send the case back to the state court in which it was filed. It was because their previous case would have been heard in federal court that they dropped it more than a year ago. “By disposing of fracking wastewater deep into the earth, Defendants introduced contaminants into the natural environment that caused an adverse change to it in the form of unnatural seismic activity,” says the second complaint of Lisa Griggs and April Marler, filed in August in Logan County District Court. “In other words, due to Defendants’ pollution of the environment, they caused the earthquakes at issue in this case.”This lawsuit is one of a few making similar allegations against the fracking industry:
- Sandra Lagra’s lawsuit was the subject of a 2015 Oklahoma Supreme Court decision that allowed her personal injury claim to proceed in Lincoln County District Court rather than before the Corporation Commission;
- Jennifer Cooper’s lawsuit is similarly still pending in Lincoln County; and
- The Sierra Club and Public Justice attempted to use the Resource Conservation and Recovering Act in a way it had never been used before, but U.S. District Judge Stephen Friot dismissed the case in April.
The two groups had alleged fracking caused the amount of earthquakes in the state to skyrocket – from 167 in 2009 to 5,838 in 2015. But Friot dismissed the case under a doctrine that allows the court to pass on deciding an issue when a state court has greater expertise in the area. “(I)t is plain that the Oklahoma Corporation Commission has brought to bear a level of technical expertise that this court could not hope to match,” Friot wrote. “The challenge of determining what it will take to meaningfully reduce seismic activity in and near the producing areas of Oklahoma is not an exact science, but it is no longer one of the black arts.
How man-made earthquakes could cripple the US economy - Dubbed the “Pipeline Crossroads of the World,” Cushing, Oklahoma is the nexus of 14 major pipelines, including Keystone, which alone has the potential to transport as much as 600,000 barrels of oil a day. The small Oklahoma town is also home to the world’s largest store of oil, which sits in hundreds of enormous tanks there. Prior to this recent spate of natural disasters, Cushing oil levels were already high. They’ve increased nearly a million barrels, to nearly 60 million barrels, since Harvey hit. This concentration of oil, about 15 percent of U.S. demand, is one reason the Department of Homeland Security has designated Cushing “critical infrastructure,” which it defines as assets that, “whether physical or virtual, are considered so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety, or any combination thereof.” The biggest potential cause of that incapacitation? According to Homeland Security, it’s not terrorism or mechanical malfunction. It’s natural disaster. And here’s the problem: When most of the Cushing tanks were constructed, the most logical cause of any such disaster seemed like a catastrophic tornado. No one anticipated swarms of earthquakes. But that’s what began occurring about five years ago, when wastewater injection and other fracking-related activities changed the seismic face of Oklahoma in dramatic fashion. When most of these tanks were constructed, seismic activity in Oklahoma was negligible. In 2011, the state experienced a 5.6 quake. Last year, it had a 5.8—the same magnitude as the quake that rocked Washington, D.C., and much of the Eastern seaboard six years ago. That Oklahoma event toppled the exteriors of historic buildings and prompted the Pawnee nation to declare a state of emergency. Seismologists at the United States Geological Survey say the area around Cushing is capable of an even stronger quake—maybe even a 7.0. Earthquake magnitude is measured exponentially, which means that a 7.0 quake would be 15 times larger than the biggest one to hit Oklahoma so far. And it would release over 60 times as much energy.
Colorado outlines new pipeline rules after fatal explosion — Colorado regulators made public a rough outline Wednesday for new rules for oil and gas pipelines after a fatal house explosion blamed on a natural gas leak. The state Oil and Gas Conservation Commission's outline calls for new standards for designing, testing and permanently shutting down flow lines, which carry oil or gas from wells to tanks and other gathering equipment.The outline was dated Sept. 8 and posted online Wednesday. The commission's staff plans to complete draft rules by Oct. 15 after meetings with interested groups on Sept. 21 and 22.A formal public hearing is scheduled for Dec. 11 and 12, and the commission could vote on adopting the rules after that.The rules are in response to an April explosion in the town of Firestone that killed two people and injured a third. Investigators blamed the explosion on odorless, unrefined natural gas leaking from a flow line that was thought to be out of service but was still connected to a well with the valve turned to the open position.The house that exploded was within 200 feet (60 meters) of the gas well, and the flow line was severed about 10 feet (3 meters) from the house, officials said. Investigators said gas seeped into the home's basement.The well and pipeline were in place several years before the house was built.The new rules would require oil and gas o perators to provide information about flow lines to the existing Call 811 program, which marks the location of underground utilities at a property owner's request.
Neighbors are fed up with fracking smells, noises in Erie subdivision - Denver7 -- The fracking debate over how close is too close to homes is playing out in Erie's Vista Ridge subdivision. "We paid extra for the view, and now it's been marred," said resident Christiaan van Woudenberg. Van Woudenberg's house is less than a thousand feet from the Pratt fracking site, and he can see another drill site to the west. Both are operated by Crestone Peak Resources. "The smell was like someone had stuffed your noise into a gas tank of a diesel truck," explained van Woudenberg. "I haven't been able to spend a single evening outside." Neighbors are fed up with the smell, and constant noises coming from the site at all hours of the day. "The noise is what keeps us up at night," said van Woudenberg. He took a video of the noise with a sound monitor late Wednesday night, and again Thursday morning. "Not only do you see it, but today, in particular, you hear it," van Woudenberg says in the video. You can hear a loud rumbling noise coming from behind the sound barrier in the video he recorded on his cell phone. "Highest peak there at about 70 decibels on the C-scale," said van Woudenberg, which is the highest measurement he's taken with his equipment. "Wake people up at literally three and four in the morning," said Ani Hulse, who lives down the street. Hulse said they've tried to get the Colorado Oil and Gas Conservation Commission, which regulates the industry, to take action.
Wisconsin budget bill strips local government control of quarries - lacrossetribune.com: Last-minute changes to the state budget would strip local governments in Wisconsin of the right to regulate quarries, and some fear the proposals could be expanded to take away town and county control over the frac sand mines that dot the western part of the state. The Legislature’s budget-writing committee last week approved a package of changes to the spending plan. In addition to stipulations on transportation funding and policy issues, the 18-page memo includes five pages of language devoted to the regulation of quarries that supply sand and gravel for construction. Among other things, it prohibits counties and municipalities from regulating blasting, hours of operation, and noise, air and water quality. It would also limit the reach of local zoning laws. The amendment threatens “100 years of tradition of local control — letting local people make land use decisions,” said Timothy Zeglin, vice chairman of the Trempealeau County Board. Fellow supervisor Jeanne Nutter said without control local officials can’t be accountable to their constituents. “Who are they going to call?” she said. “If there’s a problem. Are they going to call Madison? The DNR? Madison isn’t always going to know what’s going on in Trempealeau County.”
Minn. regulators recommend against $6.5B pipeline project | TheHill: Officials in Minnesota will recommend the state utilities commission reject a permit for an $6.5 billion pipeline project due to cross the state. The state’s Department of Commerce said Monday that Enbridge’s proposal to replace its Line 3 pipeline would not benefit the state and instead pose environmental risks. It will ask the Minnesota Public Utilities Commission to deny a permit for the project, a decision due next year. “In light of the serious risks and effects on the natural and socio-economic environments of the existing Line 3 and the limited benefit that the existing Line 3 provides to Minnesota refineries, it is reasonable to conclude that Minnesota would be better off if Enbridge proposed to cease operations of the existing Line 3, without any new pipeline being built,” the Department of Commerce said.Enbridge is looking to replace its 1960s-era Line 3 pipeline, which transports oil from Alberta to terminals in Minnesota and Wisconsin. It secured Canadian approval for the 1,031-mile, 760,000-barrel-per-day project in November, and construction is underway on a small portion of the pipeline in Wisconsin. A Minnesota Commerce Department study issued last month said that the proposed route through the state would affect fewer drinking water and cultural sites than the current pipeline, but impact areas of importance to recreational and tourism industries, Minnesota Public Radio reports. Environmentalists and Indian tribes in Minnesota have opposed the project, though Enbridge has said it can operate the pipeline safely and that it would be an upgrade over its current infrastructure.
Desjardins suspends oil pipes lending -- Desjardins temporarily suspended lending for energy pipelines projects on 7 July due to concerns about the impact such projects might have on the environment. The largest association of credit unions in North America, Desjardins Group said it had no intention of pulling out of current financing or investment activities but it was taking time to define its position. The group is still committed to a CAD $145m loan for Kinder Morgan Canada Ltd’s pipeline. According to a spokesman, Desjardins wants to ensure that “its business practices, its co-operative values and its position in regard to social responsibility and sustainable development are all aligned”. The move comes after Desjardins’ president and chief executive, Guy Cormier, asked the teams involved to work on establishing a global position for all of Desjardins’ financing and investment activities, based on its principles of responsible investing. “We are still in the process of defining our final position on this issue and a decision is likely to be taken by this fall,” said the spokesman. Responding to Desjardins’ moratorium on pipeline financing, Greenpeace Canada Climate and Energy campaigner Patrick Bonin, said: “This decision shows that astute financial institutions are becoming increasingly wary of financing fossil fuel projects. Tar sands pipelines pose major risks, whether you are concerned about profits, human rights, the environment, or all three. Desjardins has made the right decision by announcing a moratorium on investments in and financing of oil pipelines, and we look forward to it becoming permanent.”
Canada, N.Dakota crudes surge on Harvey after-effects (Reuters) - Light, sweet crude out of Canada and North Dakota surged to their highest levels in over four years on Thursday, as Midwest and East Coast refiners bid heavily for those grades after Hurricane Harvey upended energy markets in the U.S. Gulf. Widespread flooding following the giant storm forced several U.S. Gulf Coast refiners to shut, idling a quarter of nationwide refining capacity. Many of those refiners are only now rumbling back into operation. The shutdowns had a twofold effect for Midwest refineries. It pushed U.S. oil to its lowest point against Brent crude in two years, cheapening Bakken and Canadian grades for Midwest buyers. It also boosted refining margins, creating a unique opportunity for the likes of Marathon Petroleum, HollyFrontier Corp and others. Those refiners delayed scheduled work to take advantage of the stronger returns, bid up physical barrels and ran their refineries at higher-than-usual rates for this time of year. Canadian prices are higher due to demand by Midwest and East Coast refiners “anxious to cash in on higher margins while Gulf Coast plants remain offline,” said Sandy Fielden, director of oil and products research at Morningstar. He said the wider Brent/WTI spread signals that excess crude will head into the export market as soon as ports return to normal service. Canadian light synthetic prices were already higher after Canadian Natural Resources Ltd’s Horizon project in northern Alberta, one of the largest sources of supply, started a 45-day turnaround and had a fire at the plant on Monday. “It’s going up a dollar a day. It’s wild,” said one Calgary-based broker. “Nobody saw this coming.” Synthetic crude for October delivery hit $6.25 a barrel over WTI in mid-morning trade on Thursday, according to Shorcan Energy brokers. On Tuesday it closed at a premium of $3.15 per barrel.
China’s CNOOC cancels Aurora LNG project in B.C. - China's CNOOC Ltd. has cancelled a liquefied natural gas project planned for northwest British Columbia. The goal had been to build an LNG terminal on provincial Crown land on Digby Island, located less than four kilometres away from Prince Rupert Airport. But CNOOC, through its Calgary-based Nexen unit, and its partners announced on Thursday that they have decided to scrap Aurora LNG. "Over the past four years, Aurora LNG has been conducting a thorough feasibility study on liquefying and shipping LNG from the northwest coast of British Columbia to Asian markets," the consortium said in a statement on Thursday. "Through this feasibility study, Aurora LNG has determined that the current macro-economic environment does not currently support the partners' vision of developing a large LNG business at the proposed Digby Island site." Through Nexen, CNOOC owns 60 per cent of Aurora LNG, while the remaining 40 per cent is held by Inpex Corp., JGC Corp. and JOGMEC, all based in Japan. "While disappointed in this outcome, Aurora LNG is proud of its work in northwest British Columbia over the past three years and the relationships it has built with local community members, Indigenous groups, stakeholders and government," the consortium said. "The partners are committed to a responsible and orderly conclusion of their activities in the Prince Rupert region."Aurora LNG is the latest group to halt plans to export fuel from the West Coast to Asia.Pacific NorthWest LNG, led by Malaysia's state-owned Petronas, cancelled its construction plans for northwest B.C. in July. There have been more than 20 British Columbia LNG ventures pitched in recent years. Woodfibre LNG is the lone B.C. LNG venture so far to decide that it is worthwhile to build despite sharply lower prices for the fuel in Asia.
Canada Gas Set to Strike Back Against US Shale as Glut Eases | Rigzone -- Canadian natural gas, locked in a fierce battle for market share with U.S. shale, may stage a modest recovery as output from some longtime producers wanes and pipeline maintenance ends. While Canadian gas will almost always trade for less than U.S. gas -- due mostly to the cost of moving the fuel to markets in Texas and the American Midwest -- the discount recently widened to the most since 2005. The culprits are prolific new wells that are hard to shut off, along with outages on a network of pipelines that move gas around Alberta. But with the pipeline repairs that caused those disruptions mostly completed and producers like Royal Dutch Shell Plc and Petroliam Nasional Bhd's Canadian unit dialing back on output in British Columbia, the glut of Canadian gas may ease. Higher prices would be a boon for Canadian producers that have been forced to cut costs and seek new outlets in the face of escalating competition from the U.S. shale gas boom. "The Canadian operators -- given the differential problems they've had over the past few years -- they've gotten pretty adept at trying to operate this kind of environment," said Jeremy McCrea, an analyst at Raymond James Ltd. in Calgary. "So if that differential did narrow, they're set up to take advantage." Canadian gas, which is tracked using benchmark Alberta Energy Company prices -- AECO for short -- traded at $2.70 per million British thermal units less than the U.S. benchmark Henry Hub gas price on Tuesday, the steepest discount since December 2005. It narrowed to $1.33 on Wednesday. The spread has been especially volatile for the past two and a half months because of outages on TransCanada Corp.'s NGTL system in Alberta. The pipeline company has been working on a C$1.3 billion ($1.1 billion) upgrade, including the addition of compressor stations to increase capacity. That project, which is nearing completion, will increase the capacity of the northwest portion by about 700 million cubic feet a day, the Calgary-based company said in an emailed statement. Many sections are completed and operating again, and others will be back in service this month.
U.S. shale sector at critical price threshold - (Reuters) - Forward U.S. oil prices for 2018 have climbed back above $50 per barrel, a level that should be high enough to stabilise drilling activity over the next two months.But if prices continue their current upward trend, shale firms will almost certainly interpret that as a sign to increase output and begin ramping up their drilling programmes again.Shale drilling has proved very sensitive to changes in the value of West Texas Intermediate (WTI) crude, especially the forward prices shale firms rely on to hedge production and reduce their risks.Between February 2016 and January 2017, the progressive increase in forward prices encouraged shale producers to boost output by hiring extra drilling rigs (http://tmsnrt.rs/2jsXK7g).The number of rigs drilling for oil, which had been falling during the industry slump, started to increase again from May 2016, and oil output began to rise from October 2016.Rig counts typically respond to a change in oil prices with a lag of 16-20 weeks, while output tends to respond after an additional delay of five to six months.By January 2017, however, the rapid escalation in the rig count implied a large increase in production that threatened to overwhelm the market.Forecasts by the U.S. Energy Information Administration showed crude and condensates output growing by more than 0.5 million barrels per day (bpd) in 2017 and almost 1.0 million bpd in 2018.To temper the drilling boom, forward prices began to slide, with the WTI calendar strip for 2018 declining from more than $57 in January to a little over $45 in June. The calendar strip is the benchmark against which shale producers hedge production so the sharp drop sent a strong signal to ease back on drilling programmes (http://tmsnrt.rs/2f8Mqfv).The rig count levelled off in July and has been falling since August, according to oilfield services company Baker Hughes, in a lagged response to the decline in prices earlier this year (http://tmsnrt.rs/2juapHt). During their second-quarter earnings calls with investors, held in August, many shale firms announced a reduction in capital expenditure and drilling programmes for the second half of 2017. It was widely seen as a tap on the brakes to assuage investors’ concerns about overproduction and falling prices. Harold Hamm, chief executive of Continental Resources, one of the largest shale oil producers in North Dakota and Oklahoma, has said prices need to be above $50 to be sustainable.
US crude oil output to average 9.25 mil b/d in 2017, 9.84 mil in 2018: EIA -- The US Energy Information Administration on Tuesday lowered its forecasts for US crude oil output both this year and next, but still expects domestic production records to be broken next year. In its Short-Term Energy Outlook, the agency said it expects US crude output to average 9.25 million b/d in 2017 and 9.84 million b/d in 2018. Those estimates are 100,000 b/d and 70,000 b/d, respectively, lower than last month's estimate, but the expected 2018 average would mark the highest annual average production in US history, according to the EIA. The previous record dates back to 1970, when the US averaged 9.6 million b/d. EIA expects much of the growth to take place onshore, in the Lower 48 states, where daily output will climb from 6.76 million b/d in 2016 to 7.08 million b/d in 2017 and to 7.58 million b/d in 2018. Production in the Gulf of Mexico is forecast to climb from 1.69 million b/d in 2017 to 1.78 million b/d in 2018, while oil production in Alaska is expected to drop slightly over that time, from 490,000 b/d to 480,000 b/d, according to EIA. Overall, US production is forecast to climb from 9.29 million b/d this month to 9.69 million b/d by the end of the year. Output is expected to, for the first time, cross the 10 million b/d threshold in November 2018, when it is forecast to average 10.02 million b/d. EIA also forecast WTI spot prices to average $48.83/b in 2017 and $49.58/b in 2018, essentially the same as it had forecast in last month's report. EIA also forecasts Brent to average $51.07/b in 2017, down 65 cents/b from last month's forecast, and $51.58/b in 2018, the same as it forecast last month.
In sign of oil rebalancing, North Sea floating storage shrinks (Reuters) - The volume of global price benchmark North Sea crude being held in floating storage has declined sharply since mid-August, according to shipping data and trade sources, a sign that a long-awaited market rebalancing is gaining momentum. Two supertankers being used to store North Sea crudes offshore the UK, Desimi and Gener8 Neptune, contain about 4 million barrels of oil, trade sources said. Three weeks ago, the total was closer to 10 million barrels. The clearing of the crude to destinations including China and South Korea has been encouraged by a rise in the price of Brent crude for delivery soon relative to later supplies, trade sources said, a feature known as backwardation. “The whole market is tightening up,” said a North Sea trade source. “Crude inventories have been drawn down, and there is no direct economic incentive for floating storage.” The North Sea is home to the dated Brent benchmark, which is underpinned by Forties crude and three other grades. A stronger North Sea price can affect the wider market, as Brent is used to price oil around the world and underpins the futures market. Brent futures have moved back into their pre-Hurricane Harvey backwardation after concern of a significant drop in crude demand failed to materialise. With the Brent market in backwardation, the economic gain from keeping the crude in floating storage is removed. South Korea and China are regular buyers of North Sea Forties crude when the arbitrage is open.The volume of floating storage in the North Sea built up earlier this year amid a global crude glut and the price of oil being higher for future supplies, a feature known as contango.
Offshore Drilling Giant Seadrill Files For Bankruptcy --Seadrill Ltd., the London-based offshore driller controlled by billionaire Norwegian shipping magnate John Fredriksen, filed bankruptcy protection in the Southern District of Texas after working out a deal with most of its senior lenders to inject $1 billion of new money into the company pursuant to a pre-arranged plan of reorganization. The filing was largely expected and came just a couple of days before the company's $843 million 5.625% Notes of 2017 came due. According to Bloomberg, Fredriksen spent more than 18 months trying to strike an agreement with creditors to restructure the industry’s biggest debt-load after crude’s collapse curbed demand for Seadrill’s services. Daily leases for the company’s rigs, which once commanded up to $800,000, have dropped to around $200,000 as cheap oil from U.S. shale drilling continues to flood the market.“The deal gives us a great liquidity cushion,” allowing Seadrill to survive the “mother of all downturns,” Chief Executive Officer Anton Dibowitz said by phone. The new capital is “underpinned” by top shareholder Hemen Holding Ltd. and more than 40 percent of bondholders support the plan along with 97 percent of Seadrill’s secured bank lenders, he said. Dibowitz expects more bondholders to sign up to the deal.Bondholders are currently predicting their ultimate recovery is worth about 25 cents on the dollar as of today. Of course, Seadrill is just the latest bankruptcy filing in an industry that has been devastated by persistently weak commodity prices. In late July, Ocean Rig UDW Inc. filed for bankruptcy protection in the U.S. Hercules Offshore Inc., GulfMark Offshore Inc., Toisa Ltd. and Vantage Drilling Co. have also spent time in bankruptcy court since oil and gas prices cratered. Paragon Offshore PLC emerged from Chapter 11 in August but was forced back into bankruptcy after it was unable to transfer two rigs to its reorganized entity. Its successor, Paragon Offshore Ltd., isn’t under bankruptcy protection and was unaffected by Paragon Offshore PLC’s new filing.
Oil-rich Norway struggles to beat its petroleum addiction - For climate reasons as much as economic prudence, Norway is trying to cut its dependence on oil, a godsend that has made the small Scandinavian country rich beyond its dreams -- which is exactly what makes it hard to pass up. ‘Black gold’ has enabled Norway to build up the world’s largest sovereign wealth fund, currently worth close to $1.0 trillion. Yet several small political parties have raised their voices ahead of the country’s legislative elections on Monday to make sure Norway puts its oil days behind it. “We want the end of all new oil exploration,” Rasmus Hansson, one of two co-leaders of the Greens Party, told AFP. “We will not support a government that doesn’t accept our ultimatum.” The party, which according to several opinion polls could end up in the position of kingmaker, also wants to phase out Norway’s entire oil industry within 15 years. A country of 5.3 million people, Norway has become very much aware of just how petroholic, or addicted to petrol, it is — especially since the recent drop in oil prices has erased 50,000 jobs from the industry.
Floating tar, dead fish: oil spill threatens Greek beaches - The Greek authorities scrambled on Thursday to clean up fuel leaked by an oil tanker that sank near Athens, putting popular beaches off limits to swimmers and raising fears of environmental damage.The Agia Zoni II, a 45-year-old oil tanker, sank early Sunday morning near the island of Salamis, about seven miles from the country’s main port, Piraeus. It was carrying more than 2,500 metric tons of fuel oil and marine gas oil.Though the leak was initially thought to be contained to the area of the shipwreck, it soon expanded to the coastline area known as the Athens Riviera.Evaggelia Simou, a resident of Salamina, on the island, denounced the authorities for not tackling the oil spill more quickly and fully. “We drove by the Selinia beach on Sunday night, and were alarmed because of the suffocating smell of oil,” Ms. Simou said in a Facebook chat. When she and her husband went to the beach, they were shocked to see that a thick coat of oil had blackened the water. “Huge pieces of floating tar were burdening the waves, dead fish floated on the surface,” Ms. Simou said. They were surprised to see no cleanup workers, she said.Ms. Simou returned to the beach on Monday morning, along with her son, and was stunned to see no sign of an active cleanup, more than 24 hours after the shipwreck. Thick, black masses of oil had reached the beaches around Glyfada, a high-end seaside community south of Athens, by Wednesday afternoon.George Papanikolaou, the mayor of Glyfada, said he got a phone call from the Piraeus harbor master warning of the spill only a few hours before the black ooze washed up. “The vessel sank on Sunday. How is it possible that the leak reached Glyfada from Salamina?” Mr. Papanikolaou asked in a phone interview. “And how is it possible that we only heard about it on Wednesday?”
Footage of Greek Oil Spill Shows Massive Scale of Damage - The sinking of a tanker carrying 2,200 tons of fuel oil and 370 tons of marine gas oil has coated some of Greece's most popular beaches in thick, black sludge, leading to health authorities to ban swimming along shorelines in Athens. The Agia Zoni II tanker sank Sunday off the coast of Salamina island and left behind "a huge environmental and financial disaster," Salamina mayor Isidora Papathanasiou told local news , adding that the "smell is intense and our eyes are stinging." The mayors of Salamina, Piraeus and Glyfada warned they might take legal action over the pollution "against whoever is responsible." Greece's government has been criticized for not doing enough to prevent the oil slick from spreading to the Saronic Gulf in Athens, a region home to a wide variety of marine life including dolphins, turtles, fish and sea birds. "If a small relative leak causes such a disaster next to the country's largest port and the operational center of the Ministry of Mercantile Marine, what exactly is the country's ability to cope with spills and accidents from large-scale oil activities in the Ionian Sea and the Cretan Sea?" said Takis Gregoriou, the head of the campaign for climate change and energy at Greenpeace Greece , in a statement. World Wildlife Federation Greece also called the spill an "environmental crime." After touring affected areas, shipping minister Panagiotis Kouroumblis insisted that the situation is improving. He said that cleanup is underway and also suggested Thursday he would resign if asked by Prime Minister Alexis Tsipras, according to Greek Reporter . The Associated Press reports that Greece has requested help from the European Union's Civil Protection Mechanism and deployed a specialized cleanup vessel.
BP and partners sign new 25-year Azerbaijan oil production sharing contract - BP and its partners in Azerbaijan's giant ACG oil production complex agreed Thursday to extend the production sharing contract by 25 years to 2049 and to increase the stake of state-owned SOCAR, reducing the size of their own shares. SOCAR stake raised at partners' expense Deal accesses 2 billion more barrels The Azeri-Chirag-Deepwater Gunashli (ACG) complex in the Caspian Sea produces most of Azerbaijan's sought-after crude oil. At the time of the signing of the original production sharing contract in 1994, it was seen as a major advance by the international oil industry into the former Soviet state, dubbed the "contract of the century." Output has been declining for a number of years, however, falling particularly steeply in the first half of this year -- by 11% compared with a year earlier -- to 585,000 b/d, despite the startup of a new platform in 2014 at a cost of $6 billion. Under Thursday's deal, the international companies will pay a $3.6 billion bonus to the state oil fund over a number of years. The international partners comprise BP, currently with a 35.8% stake; Chevron with 11.3%; Japan's INPEX with 11%; Norway's state-controlled Statoil with 8.6%; ExxonMobil with 8%; Turkey's TPAO with 6.8%; Japan's ITOCHU with 4.3%; and India's ONGC Videsh with 2.7%. The extension of the production sharing contract, which was to expire in 2024, was seen as necessary to ensure continued investment. The altered shareholder structure also gives SOCAR a greater share of production and greater spending obligations as its stake in the consortium rises from 11.6% to 25%. Total operating costs last year for ACG were $503 million, and capital expenditure was $1.45 billion. BP said the deal would enable the partners to access an additional 2 billion barrels of economically recoverable oil from the end of the current version of the production sharing contract. The partners will carry out preliminary engineering work to evaluate the possible addition of another platform, it added. The deal cuts BP's stake by 5.43% to 30.37%, with corresponding reductions for the other partners.
Did This Oil & Gas Deal Just Change The Global Energy Balance? - One of the biggest energy stories this year has been Russia’s Rosneft buying India’s Essar Oil - giving the Russian company a firm grip on one of the world’s biggest emerging oil and gas markets. And this past week, that story got more complex. With Rosneft striking another big deal — drawing in another heavyweight energy nation. China. Rosneft announced Friday it is selling a significant chunk of its equity to Chinese investors. In this case, little-known exploration and production firm CEFC China Energy. Although few investors know CEFC, the company is bringing significant capital to the deal. With the firm agreeing to pay $9 billion to acquire a 14.16 percent stake in Rosneft. The deal is historic in being the first major buy-in by China into the Russian oil and gas sector (although Chinese firms have been involved in financing LNG export projects in the Russian Arctic).Showing the strength of the ever-growing ties between Russia and China in the energy space. Rosneft and CEFC have been at the center of that burgeoning relationship. With the two companies having signed a deal this past September for long-term supply of Russian crude into China. This week’s equity purchase further cements those business ties. And shows that China sees Russia as a critical ally in the energy game going forward.But there are implications well beyond these two countries. With China now having backdoor access into markets like India — through Rosneft’s recently-acquired holdings in that country. That’s a critical development for the world energy picture. Given that Chinese companies haven’t directly gained much access into India — despite the nation being one of the most important emerging players on the energy stage. Ownership in Rosneft could help change that. And could open up opportunities in other parts of the world — with Rosneft currently having operations in places ranging from Egypt to Brazil to Venezuela.
India's Energy Crisis Just Went "Super Critical" -- Big disappointment in the global natural gas industry this week, with majors Total and Eni coming up largely dry in a much-anticipated well offshore Cyprus. But elsewhere things are turning extremely bullish for natgas. With one of the world’s fastest-emerging energy consumers scrambling to get all the supply it can. India. Local media reported this week that India’s power generators are seeing a sudden surge in natgas buying because of an “acute” shortage in the country’s go-to energy fuel: coal. After enjoying years of ample coal supply, India’s power sector has seen inventories slip drastically into the red in recent months. With ten major power plants classified as “critical”, with less than seven days of coal stocks — and five of those being “super critical” with less than four days of coal supply. And that drastic shortage has reportedly turned these generators to natural gas in a major way. Sources said India’s generators have purchased 10 million cubic meters (350 million cubic feet) during “the last couple days”. Indicating energy producers are getting desperate in keeping their operations in business amid the coal shortage. This potentially has long-term implications for global natural gas. Because of a peculiar feature of India’s energy landscape: a fleet of unused gas-fired plants. India in fact has over 25 GW of installed gas-driven generating capacity. But here’s the thing: 55 percent of that capacity usually never runs. Because it’s “technically stranded” — having no access to natgas feed at commercially-competitive prices. But the coal crisis is changing the economics here. Power operators are so desperate to keep the lights on, they’re willing to pay the higher prices required to deliver gas to the stranded power plants — causing this week’s major surge in natgas buying. If the coal shortage persists, that demand could become permanent. Watch for weekly data on coal stocks at India’s power plants, and stats on natural gas usage across India — which could have knock-on effects on imports.
ExxonMobil slashes LNG price to India in bad omen for producers (Reuters) - India has won a price cut on a 20-year liquefied natural gas (LNG) deal with global giant ExxonMobil in a rare contract renegotiation, a bad sign for producers in a heavily oversupplied global market. In a trade-off for ExxonMobil, India’s Petronet LNG will increase its volumes from the Gorgon LNG project in Australia by an extra 1 million tonnes a year to about 2.5 million tonnes a year, but at cheaper rates than initially agreed in 2009. Long-term contracts are rarely revised in the LNG market, and for a big producer to cave in shows how supply from new plants in Australia and the United States over the past two years has transformed the market, analysts said. “This trend is overall a negative for sellers, as they are forced to provide more flexibility to buyers’ needs to maintain their markets,” said Saul Kavonic, an analyst with energy consultants Wood Mackenzie. India has been aggressive in seeking cheaper deals, also renegotiating a contract with Qatar in 2015, but the real pain for producers would come if major Asian buyers in Japan, Korea and China followed suit. “Happy to share good news that India has, yet again been able to address the long term price issue of LNG from Gorgon to suit Indian market,” India’s oil minister, Dharmendra Pradhan, said on Saturday on social media. Indian consumers would soon receive LNG at an “amicable price”, Pradhan said. India started receiving Gorgon supplies from January this year. Petronet said in a stock exchange announcement on Monday it had reached a “broad understanding of terms” with ExxonMobil, without giving further details.
Exxon Mobil's deal to cut India LNG prices is actually quite good: Russell (Reuters) - Exxon Mobil’s deal to cut the price of liquefied natural gas (LNG) supplied under long-term contract to an Indian buyer has largely been viewed as a bad outcome for producers of the super-chilled fuel. Certainly the trade made by Exxon to supply more LNG to Petronet LNG, but at a lower price, does seem to favor the Indian utility. Exxon will increase the volume supplied from its share of the Chevron-led Gorgon project in Western Australia by 1 million tonnes a year to about 2.5 million tonnes, but at a lower cost than originally agreed in 2009. The revised deal has sparked market speculation that this is the first domino to fall, and that more re-negotiations of long-term LNG contracts are likely. Up until now it has been extremely rare for these agreements to be amended, and so far, it has only been in India, where a deal with top LNG supplier Qatar was re-worked in 2015. Producers are probably nervous that major buyers in Japan, South Korea and China, which account for more than half of the global LNG market, will be tempted to seek better terms. Already there are some moves towards this end, with utilities in Japan banding together to pool their buying power and seek more flexible and shorter-term deals. What the Exxon-Petronet deal is a further sign of is that the era of long-term LNG contracts with prices linked to moves in crude oil are going the way of the dinosaurs. The market is already moving towards both spot and short-term deals, ranging from several months to a few years.
Political headaches as China sucks up Australian coal, LNG - (Reuters) - When is rising Chinese demand for your natural resources not a good thing? When you are Australian and higher prices for coal and liquefied natural gas (LNG) are causing domestic shortages and soaring electricity prices. In theory it should be great days for Australia’s economy and resource companies, and even Australian politicians keen to take the credit for booming exports and the associated jobs. But the world’s largest exporter of coal, and second-biggest of LNG, is discovering that export success can quickly become a politically-charged hot potato when it is linked to rising costs for local consumers. First the three new LNG plants in the eastern state of Queensland were accused of sucking up natural gas supplies, driving up prices and potentially causing supply shortages. This was a bit of a stretch as only one of the three projects was capable of using natural gas that may have otherwise been made available to the domestic market. Still, the perception that LNG exports were driving domestic prices higher stuck, leading the Liberal Party-led federal government of Prime Minister Malcolm Turnbull to introduce a mechanism to divert natural gas to the domestic market if the demand is there. It’s not clear whether this solution will work in practice, as the main problem appears not to be the domestic availability of natural gas, rather that the local price is effectively linked to what supplies can be sold for as LNG exports. As one analyst put it, if natural gas is available in Queensland at the same price as LNG, and nobody wants it, is there still a shortage?The situation has been complicated by governments in the populous states of New South Wales and Victoria, home to the major cities of Sydney and Melbourne respectively, acting to restrict or ban the production of onshore natural gas.
Analysis: Iranian oil flows gain further ground in China, Europe - Iran's crude and condensate exports rose slightly in August as lower deliveries from key competitors like Saudi Arabia and Iraq meant there was more demand for crude from some of Iran's main buyers. Total estimated export volume on Aframaxes, Suezmaxes and VLCCs from Iranian ports in August rose almost 2.5% to 2.42 million b/d from 2.37 million b/d in July, according to data from Platts trade flow software cFlow. Exports to Asia fell to 1.46 million b/d in August from 1.55 million b/d in July, with demand from key customer India down sharply, although flows to China continued to rise. Europe's share of Iranian exports grew sharply, with demand from Italy, France, the Netherlands and Greece all up, while Turkey remained a key buyer too. Sources and analysts noted that Iranian oil exports last month rose as demand for its crude, especially in China and Europe, climbed, supported by favorable economics. Moves by Saudi Arabia and Iraq to further reduce their exports in August, both to meet domestic demand and also as part of OPEC's coordinated output cuts, bode well for Iran. The reductions have created a gap for Iran to fill, while state-owned NIOC has also reduced prices for some if its heavy crude grades, making them more economically viable for refiners and pushing up spot demand.
Saudi to supply full crude allocations to most Asian refiners: sources (Reuters) - Saudi Arabia will supply full contracted volumes of crude oil to at least five north Asian term buyers in October, while a sixth regional refiner was notified of cuts to its October Arab Extra Light supplies, sources familiar with the matter said on Monday. The October allocations are in contrast to the steep cuts in the September allotments and reaffirms Saudi Arabia’s desire to maintain its Asian market share. Saudi Arabia is the world’s biggest crude exporter. Saudi Arabia is likely taking advantage of the lower refinery run rates and ample crude inventories in the United States in the wake of Hurricane Harvey, to redirect the allocation cuts from Asia to the United States, a trader who specializes in Middle East crude supplies said. “Saudi allocations are all about the math. They can cut U.S. allocations and supply that to Asia,” the trader added. A source from the sixth Asian refiner said that its October supply of Arab Extra Light crude was cut by 10 percent, likely because of repair work in September at Saudi Arabia’s Abqaiq oilfield, which produces the grade. Saudi Arabia plans to cut crude oil allocations to its customers worldwide in October by 350,000 barrels per day (bpd), an industry source familiar with Saudi oil policy told Reuters on Thursday, in line with Saudi Arabia’s commitments to a supply reduction pact by the Organization of the Petroleum Exporting Countries and other producers. In comparison, Saudi Arabia pledged last month to cut its September crude oil worldwide allocations by 520,000 bpd.
OPEC Fails To Cut Oil Exports Below 2016 Levels -- OPEC exported 25.19 million bpd of crude oil last month, the lowest since April this year, Thomson Reuters Oil Research said, but the eight-month average for the year to date was 25.05 million barrels, exceeding the average for the corresponding period of 2016, which stood at 24.85 million bpd. What’s more disheartening for the cartel, which has been cutting production since last December, is that the August fall was mostly a result of supply disruptions in Africa rather than the outcome of the conscious effort.“Crude oil exports from OPEC’s African members tumbled by 540,000 bpd month-on-month to below 5 million bpd after posting their highest export volumes in July since at least Jan. 2015, thereby breaking a four-month streak of rising exports,” the research unit said in a report on Wednesday. While this fall in crude oil exports from Africa compensated for higher shipments from Middle Eastern OPEC members, it will likely be short-lived, Thomson Reuters Oil Research said. The crisis in Venezuela, however, which was the other main contributor to the 370,000-bpd decline in OPEC exports from July to August, will probably persist, providing further support for lower exports.Yet not everyone agrees with Reuters figures. Earlier this month, energy data provider Kpler reported that OPEC’s August exports averaged 25.897 million barrels daily, on the back of Saudi Arabia’s 494,000 bpd cut in shipments as per its pledge to export no more than 6.6 million barrels in that month. According to Kpler, three African members of the cartel actually increased their exports in August: Algeria, Angola, and Nigeria. The combined increase from these three countries exceeded 350,000 bpd. OPEC officials insist that the output cut deal is working and global supply is falling, despite export patterns. Even so, the deal might get another extension beyond March 2018, as per comments made yesterday by Russia’s Energy Minister Alexander Novak. The chance of this happening remains uncertain but the option is on the table.
OPEC Reports First Oil Production Drop In 4 Months As Deal Compliance Slides -- Confirming Monday leaks that OPEC production had dipped last month, the just released OPEC report for the month of September confirmed that in September, OPEC produced 32.755mmb/d (according to secondary source data), a drop of 79,100 bpd, and the first monthly decline in 4 months. According to the underlying data, in the last month output increased in Nigeria (+138.3Kb/d), while declining in Libyam Gabon, Venezuela and Iraq. Saudi Arabia. While secondary sources pegged Saudi production in August at 10.022mmb/d, a drop of 10.3kb/d in the past month, the Saudi self-reported number was 9.951mmb/d, not a nominal difference and a drop of nearly 60kb/d from the Saudi self-reported 10.01mmb/d July number, perhaps indicating that the Saudis are trying a little too hard to demonstrate compliance with the production cut agreement. In the same report, OPEC boosted global oil demand growth in 2017 to 1.42mmbpd, an upward revision of 50kb/d from last month's estimate, predicting that the impact of Hurricane Harvey on demand will be “negligible”, with disruption offset by rebuilding activity. Demand for OPEC crude in 2017 is estimated at 32.7mmb/d, roughly 0.5mmb/d higher than the 2016 level. 2018 demand is now seen at 98.1m b/d, with growth rate revised up by ~100k b/d to 1.35m b/d. At the same time, OPEC also raised estimates for the amount of crude it will need to supply next year by 400k b/d to 32.8m b/d. OPEC expects non-OPEC supply to grow by 0.78mmbpd in 2017, unchanged from the previous month due to offsets between Kazakhstan and the US. OPEC also cut its forecasts for growth in non-OPEC supply next year by 100k b/d amid lower expectations for Russia and Kazakhstan; total non-OPEC is projected to expand by 1m b/d to 58.8m b/d in 2018. From the report: Based on the current global oil supply/demand balance, OPEC crude in 2017 was revised up by 0.2 mb/d from the previous report driven mainly by the upward revision in demand. Within the quarters, the second quarter was revised up by 0.3 mb/d, while the first, third and fourth quarters were revised up each by 0.2 mb/d. As a result, OPEC crude is estimated at 32.7 mb/d, representing an increase of 0.5 mb/d from the 2016 level.
OPEC Unfazed By Falling US Oil Demand - Oil prices held steady in early trading on Tuesday after the release of OPEC’s latest report, which struck a confident tone about the pace of rebalancing underway in the oil market. . In its latest monthly report, OPEC revised up its forecast for global oil demand growth, predicting consumption will expand by 1.42 mb/d this year, an upward revision of 50,000 bpd from a month earlier. Meanwhile, OPEC’s collective oil production dipped in August for the first time in four months. Output fell by 79,000 bpd in August from a month earlier, mostly the result of sizable outages in Libya, but also because compliance with the group’s cuts improved among other OPEC members. OPEC’s estimate for oil inventories in OECD countries also declined for the third consecutive month, putting total storage at 195 million barrels above the five-year average. “It is clear the rebalancing process is under way,” OPEC’s Secretary-General Mohammad Barkindo said in a speech on Monday. OPEC also dismissed worries about demand falling short in the U.S. because of the two major hurricanes. The cartel said the storms will have a “negligible” impact on U.S. demand. Goldman Sachs says that Hurricane Harvey will reduce demand by 600,000 bpd in September while Irma could reduce demand by 300,000 bpd. After factoring in oil production outages in Texas from Harvey, which cut output by 300,000 bpd, Goldman says that on balance the two hurricanes will cut oil demand by 600,000 bpd in September. Other analysts agree. Thomas Pugh, a commodity economist at Capital Economics, estimates that the two hurricanes will lead to a steeper drop in demand than Hurricane Katrina in 2005, which saw a dip in U.S. oil demand by 2 percent in the three months following the storm. Ultimately, that could lead to an increase in crude oil inventories by about 40 million barrels in the next month, Goldman says. “That’s obviously not particularly useful for the global rebalancing effort,” he said, according to the WSJ. Meanwhile, the bank says that the refineries in Texas and Louisiana are still operating at reduced rates, keeping 2.24 mb/d of refining capacity offline.
Hedge funds watch U.S. refinery restarts: Kemp - Hedge funds are betting crude oil stocks will adjust quickly to the aftermath of Hurricanes Harvey and Irma but gasoline and distillate inventories may take more time to normalise. Hedge funds and other money managers increased their combined net long position in the five major petroleum contracts linked to crude, gasoline and heating oil by 46 million barrels in the week to Sept. 5, according to the latest regulatory and exchange data. Fund managers recovered some of their pre-hurricane bullishness after cutting net long positions in the petroleum complex by a total of 116 million barrels over the previous two weeks (http://tmsnrt.rs/2jhR0sX). But position changes varied significantly between Brent and WTI, and between crude and fuels, reflecting the fact the hurricanes have hit refineries, distribution systems and motorists rather than oil wells. Hedge fund managers have sharply increased bullish positions in U.S. gasoline, U.S. heating oil and European gasoil to multi-year highs. Speculators anticipate shortages of road fuels and heating oil since many U.S. refineries are still offline or operating at reduced rates after extensive flooding. Fund managers increased their net long position in U.S. gasoline by almost 17 million barrels to 66 million, the highest level since oil prices started slumping in the middle of 2014. Funds also increased their net long position in U.S. heating oil by 11 million barrels to 41 million barrels, the highest for 42 months. Portfolio managers also increased their net long position in European gasoil by 2.8 million tonnes to 15.7 million tonnes, the highest since at least 2014. U.S. refinery disruptions are expected to draw European gasoline to the United States to meet the supply shortfall while curbing the counter-flow of U.S. diesel to Europe. But while hedge funds see the impact on fuel supplies lingering for some time, they are more confident that crude producers will find a way around the refinery bottleneck.
Mind the gap: Brent and WTI point in opposite directions – Kemp (Reuters) - Commodity markets abhor a gap and will find a way to arbitrage it away. Such a large gap between forward Brent and WTI prices is unlikely to persist for every long.Either Brent prices and calendar spreads must weaken, WTI prices and spreads must strengthen, or some combination of both.In the short term, Hurricanes Harvey and Irma have extensively disrupted oil refineries, distribution systems and motorists along the U.S. Gulf Coast.The result has been to cut refinery consumption of domestic crude and depress the price of WTI compared with Brent.WTI futures for delivery in November 2017 are trading at a discount to Brent of around $5.30 per barrel compared with $2.75 on Aug 14 (http://tmsnrt.rs/2f28kkj).WTI is trading in a contango of about 44 cents per barrel between November 2017 and December 2017 compared with a backwardation of 22 cents in Brent (http://tmsnrt.rs/2jlQ9aR).Backwardation in Brent is consistent with a tightening global oil market while contango in WTI is consistent with local oversupply of crude as a result of refinery shutdowns and the closure of export terminals.Most of this can be put down to temporary disruptions caused by the hurricanes.Restarting refineries after flooding is a slow and complicated process plagued with safety risks ("After Harvey: precautions needed during oil and chemical facility start up", U.S. Chemical Safety Board, Aug 2017).And U.S. export terminals were badly affected by the storm which cut crude exports to just 153,000 barrels per day in the week ending on Sept.1 compared with 902,000 bpd the week before.So the hurricanes will almost certainly leave the United States with a short-term build up of crude stocks that could linger for some weeks or months until it can be exported or absorbed by domestic refineries.The problem is that the gap extends well into the first half of 2018 when U.S. refineries and export terminals should have been back up and running for several months.
Oil rises as U.S. refineries restart, Irma wanes | Reuters: (Reuters) - Oil prices rose on Monday as key U.S. refineries began restarts following Hurricane Harvey, which may help revive crude oil processing, while fuel prices fell as Hurricane Irma is likely to clip demand for gasoline and diesel. The possibility of an extension to the 15-month production pact between members of the Organization of the Petroleum Exporting Countries and non-OPEC producers also helped to support prices, traders said. Brent crude oil futures settled up 6 cents, or 0.1 percent, to $53.84 a barrel while U.S. West Texas Intermediate crude rose by 59 cents, or 1.2 percent, to $48.07. Hurricane Irma knocked out power to over 7.3 million in Florida, Georgia, South Carolina and Alabama, according to state officials and utilities on Monday. That has raised concerns about demand, as storms tend to cut down on driving, particularly as many cars have been destroyed. Both U.S. product futures ended lower - gasoline dropped 0.7 percent and heating oil fell 1.4 percent. Harvey is still likely to be a bigger driver for the crude market, analysts at Goldman Sachs said. A quarter of U.S. refining capacity to be taken off-line due to the hurricane, sapping demand. Refining runs on the U.S. Gulf Coast hit a record low in the week to Sept. 1, just after the storm, due to shutdowns. “While some are concerned about the demand side [from Irma] I don’t think it’s that big a situation,” said James Williams, president of energy consultant WTRG Economics, noting that Harvey had more of an impact on crude, “The demand for crude is going to be set by the refineries coming back online.”
Refined oil product futures falling on demand concerns following Irma - Refined product futures were leading the oil complex lower Monday as Hurricane Irma moves north through Florida's Gulf Coast, provoking concerns about depressed oil demand in the storm's wake. At 1444 GMT, NYMEX October ULSD was down 3.47 cents at $1.731/gal. NYMEX October RBOB was 4.29 cents lower at $1.6047/gal. NYMEX October crude was 9 cents lower at $47.39/b. NYMEX November Brent was 35 cents at $53.43/b. The arrival of Irma has helped unwind some of the recent strength seen in product cracks. The front-month NYMEX ULSD crack against WTI was near $27/b last week, its highest level since March 2015. The ULSD crack was down $1.38 at $25.30/b Monday morning. The NYMEX RBOB crack has cooled off after spiking above $27/b, hovering around $20/b-$22/b since last week. Another reversal Monday was the front-month ICE Brent/WTI spread coming in after reaching its widest level on Friday since August 2015. That spread was around $5.48/b Monday, compared with $5.72/b a day earlier. In addition, the US Dollar Index was rebounding Monday morning after having fallen Friday to 91.011, its lowest point since January 2015. The dollar index was up 0.377 at 91.729 Monday morning. That index has fallen sharply of late, partly driven by reduced expectations the Federal Reserve will raise interest rates before the end of the year, according to BBH analysts. Personnel news regarding central bankers Stanley Fischer and Janet Yellen, as well as White House economic advisor Gary Cohn may have also played a role, the analysts said. "The early retirement of the Federal Reserve's Vice Chairman Fischer and reports that suggest the chances of Cohn replacing Yellen have fallen may have contributed to the reduced expectations and the weaker dollar," they said. A weaker dollar is supportive for commodity prices, but crude oil has failed to catch a bid from this soft patch. Front-month NYMEX crude was trading Monday at roughly the midpoint of the $45/b-$50/b range where the contract has been since mid-July.
Oil Factbox: Refined product prices fall as Irma moves north - Refined product futures were lower Monday as Hurricane Irma moves north along Florida's Gulf Coast.The NYMEX front-month RBOB contract settled down 1.31 cents/gal at $1.6345/gal, while the front-month ULSD contract fell 2.30 cents/gal to settle at $1.7427/gal. Irma did not cause any damage to the limited oil infrastructure in Florida, which consists primarily of ports and storage terminals, but sparked concerns about depressed refined product demand.Goldman Sachs analysts said Monday in a note that the recovery in refinery runs and trade flows was taking longer than had been expected. After rising because of evacuations, gasoline demand will fall for two weeks and perhaps longer because of residual flooding, with the average loss attributed to Irma at 250,000 b/d for the next month, Goldman said. Fuel terminals in the ports of Tampa and Port Everglades have reopened and distributors were working Monday to restock thousands of stations drained of fuel during last week's massive evacuation. Platts cFlow trade flow software shows two refined products vessels scheduled to arrive in Tampa this week. The tanker Florida and tanker Louisiana are both scheduled to arrive Wednesday and make regular runs between Louisiana and Florida.The West Virginia is due to arrive in Tampa on Thursday, having left the New York area seven days ago.Several other refined products vessels are scheduled to unload at Port Everglades this week, including the Mare Pacific on September Tuesday, the Overseas Nikiski on September Thursday and the Mt Sea Halcyone on September Friday, according to cFlow.The Mexican Gulf Coast ports of Tuxpan, Veracruz, Tampico, Pajaritos, and Cayo Arca are all currently operating after being closed last week ahead of the arrival of Hurricane Katia, data from Pemex showed Monday. The port of Tuxpan was closed September 6 ahead of Katia, which made landfall over the weekend. Data from Platts cFlow showed several refined products vessels near Tuxpan Monday. The Largo Sun appeared to be offloading refined products. That vessel in late August had loaded at the IMTT terminal in Bayonne, New Jersey. Mexico at the time was sourcing refined products from outside of US Gulf Coast refineries, many of which were shut because of Hurricane Harvey.
Oil prices climb for 2nd day as OPEC report shows production drop - Oil prices headed higher Tuesday, stretching gains in to a second-consecutive session as the latest OPEC report that showed oil production from the cartel fell last month. Expectations for a hefty weekly rise in U.S. crude-oil supplies limited the price rise for oil, however. Inventories likely jumped on the back of lower demand from refineries that shutdown output of petroleum products in the wake of Hurricane Harvey. West Texas Intermediate crude oil for October delivery gained 16 cents, or 0.3%, to $48.23 a barrel on the New York Mercantile Exchange, while Brent oil for November added 48 cents, or 0.9%, to $54.32 on ICE Futures Europe. In a monthly report released Tuesday, the Organization of the Petroleum Exporting Countries said output in August fell by 79,000 barrels a day to 32.76 million, driven mainly by a decline in Libya, Gabon, Venezuela and Iraq. Production had been on the rise over the summer, raising concerns OPEC’s deal to cut output wasn’t working. Saudi Arabia—OPEC’s most influential member—has been debating whether to extend the cartel’s production accord after it expires in March 2018. The report from OPEC also highlighted that production outside the group fell in August, driven by disruptions in the U.S. after Hurricane Harvey rampaged through the oil producing regions in Texas and Louisiana. It made landfall on the Texas coast on Aug. 25. But many refineries along the Gulf Coast were knocked offline by the hurricane, prompting a notable rise in crude stockpiles for the week ended Sept. 1, according to the Energy Information Administration.
WTI/RBOB Extend Gains After Biggest Gasoline Draw On Record --WTI/RBOB gained on the day after OPEC headlines but with disruptions still looming over much of the refining capacity in the Gulf Coast, today's API data, showing the trend of Gasoline draw (the biggest ever) and Crude build continues, sparked further gains. API:
- Crude +6.181mm (+4.82mm exp)
- Cushing +1.32mm (+1.6mm exp)
- Gasoline -7.896mm (-1.5mm exp) - biggest ever
- Distillates-1.805mm
Last week saw the biggest gasoline inventory draw on record as Crude's build trend continued... WTI/RBOB gained today on the heals ofOPEC production cut extension chatter, but as Kyle Cooper, director of research at IAF Advisors, says, "OPEC potentially extending cuts is “bullish in the sense that they are willing to do it, but it’s effectively bearish that they have to...” While the initial move was algos slamming them lower, the trend was higher...
Goldman: Harvey, Irma Cause 900,000 Bpd Drop In Demand -- In the wake of the hurricanes Harvey and Irma, oil demand is expected to drop by some 900,000 bpd this month, Goldman Sachs said on Monday. “Irma will have a negative impact on oil demand but not on oil production or processing,” Goldman analysts said in a note, as carried by Reuters.“Harvey’s negative impact on demand will remain larger, however, given the large concentration of energy-intensive petrochemical activity in its path,” the bank said.According to Goldman’s estimates, the combined effects of production disruption and demand drop from hurricanes Harvey and Irma alone will lift global oil inventories by 600,000 bpd in September.For next month, estimates are that the hurricanes will lower oil demand by some 300,000 bpd, according to Goldman Sachs. Gasoline demand will suffer the most from the storms, adding to the expected 150,000-bpd drop this month due to seasonal factors, Goldman said. Harvey hit Texas and Louisiana two weeks ago, and led to more than one-fifth of the U.S. refining capacity to shut down. Refineries are restarting in Texas and as of 02:00 PM EDT on Sunday, five refineries in the Gulf Coast region were still shut down, with a combined refining capacity of 1,069,300 bpd, equal to 11 percent of total Gulf Coast refining capacity and 5.8 percent of total U.S. refining capacity, according to the DOE. Last week, Goldman Sachs said that reconstruction in Hurricane Harvey’s aftermath was expected to be ultimately positive for U.S. oil demand in a few months, as fuel consumption is expected to increase as people rebuild homes. However, Goldman said that its prediction for increased fuel demand could be upset if Hurricane Irma were to make landfall in Florida, where it would not be felt so much on the sparse oil infrastructure than on fuel demand.
IEA Forecasts Fastest Oil Demand Growth In Two Years -- The International Energy Agency, which advises most major economies on energy policy, forecast that global oil demand will climb this year by the most in two years amid stronger-than-expected consumption in Europe and the U.S. although it was unclear just how this will offset recently fading demand by the two biggest marginal consumers, China and India. The IEA reported that global oil demand grew very strongly in Y/Y in Q2 2017, by 2.3mmb/d, or 2.4%, and increased its estimate for demand growth in 2017 by 100,000 barrels a day to 1.6 million a day, or 1.7%. The IEA has now raised its 2017 oil-demand growth forecast for three months in a row. The agency observed that the re-balancing of oversupplied world markets continues with OPEC supplies falling for the first time in five months as reported yesterday, and inventories of refined fuels in developed nations subsiding toward average levels. In August, global oil supply fell by 720 kb/d due to unplanned outages and scheduled maintenance, mainly in non-OPEC countries. OECD commercial stocks were unchanged in July at 3 016 mb, when they normally increase. “Demand growth continues to be stronger than expected, particularly in Europe and the U.S.,” the Paris-based agency said in its monthly report. The IEA also said that the impact of Hurricane Harvey on global oil markets is “likely to be relatively short-lived,” according to Bloomberg. Although the oil market “coped relatively well” with the disruption caused by this year’s storms, the damage to U.S. facilities will still be felt, according to the report. The country’s production was curbed by about 200,000 barrels a day in August and 300,000 a day in September.
Oil Prices Rise After API Reports Largest Gasoline Draw On Record -- The American Petroleum Institute (API) reported a build of 6.181 million barrels in United States crude oil inventories, compared to analyst expectations that inventories would build by 10.1 million barrels for the week ending September 8 as many refineries in the Gulf Coast remain offline and demand in Florida wanes in the wake of the most recent hurricane. Gasoline inventories fell more than anticipated—by 7.896 million barrels for the week ending September 8, against an expected draw of 4.0 million barrels. Crude oil prices rose on Tuesday as OPEC reported lowered production in August—down to 32.755 million barrels daily per month in August, down from 32.834 million bpd in July, according to OPEC’s Monthly Oil Market Report published on Tuesday. The production decreases were more due to Libya’s unrest that saw a 112,300-barrel decline in August’s production, rather than a conscious effort to adhere to the cartel’s production cut deal. WTI climbed 0.4% by 2:15pm EST to $48.26, and Brent prices increasing by 0.72% to $54.23. Gasoline was also trading up—1.29%—but almost flat on the week at $1.6556 as much of the refining capacity in the Gulf Coast comes back online. This week’s crude oil inventory build takes away from the previous streak of draws that saw almost 50 million barrels removed from inventory, according to API data. The total draw for crude oil in 2017 now stands at 23 million barrels. Distillate inventories fell this week, by 1.805 million barrels, against a smaller expected draw of 300,000 bpd. Inventories at the Cushing, Oklahoma, site increased by 1.320 million barrels. By 4:40pm EST, WTI was trading at $48.18 with Brent Crude trading at $54.21.
WTI/RBOB Sink After Big Crude Build, Production Jump Offsets Greatest Gasoline Inventory Draw In History WTI and RBOB prices are higher this morning following API's reported the biggest gasoline draw in history (compared to EIA data). Of course, disruptions (Florida demand and Texas supply) remain dominant but DOE reports a massive 8.4mm draw in Gasoline inventories - the biggest draw ever. The reaction in prices is anti-climactic as production rebounded and crude built dramatically to offset the exuberance.Bloomberg's Javier Blas reminds readers that the report covers the period from 7:01 am on Friday, Sept. 1 to 7:00 am on Friday, Sept. 8. So a lot of disruption from Harvey (particularly from Sept. 1, 2, and 3) will still impact everything from refining intake to crude production and U.S. imports and exports. DOE:
- Crude +5.888mm (+4.82mm exp) - biggest build in 6 mos
- Cushing +1.023mm (+1.6mm exp- biggest build in 6 mos
- Gasoline -8.428mm (-1.5mm exp) - biggest draw ever
- Distillates -3.215mm - biggest draw in 6 mos
Bloomberg Intelligence energy analyst Vince Piazza notes that the impact from hurricane season will keep crude demand subdued, with roughly two million barrels of daily refining capacity off-line. Depressed gasoline consumption should persist temporarily on lower transportation use and suppressed refining utilization. Gasoline inventories confirmed API's data and saw the biggest draw in history as Crude and Cushing saw major builds... The bearish data point is that total U.S. petroleum inventories (that's crude, refined products, propane and the volatile "other oils" category) have built for the second consecutive week. Total stocks up 1.7 million barrels, driven by big builds in crude, propane and other oils.
EIA Reports Crude Oil Inventories Rose 5.9 Million Barrels, WTI Oil Price Edges Lower: The latest Energy Information Administration (EIA) data recorded an inventory build of 5.9 million barrels for the week ending September 8th following a build of 4.6 million barrels the previous week. Consensus forecasts were for a build of 4.0 million barrels, although there was again an important element of uncertainty given the impact of hurricane Harvey which continued to cause sharp fluctuations across all metrics. Crude inventories increased to 468.2 million barrels, although there was still a year-on-year decline of 2.5%. Cushing inventories recorded a build of 1.02mn barrels on the week which was close to consensus expectations. Domestic crude production recovered sharply by 6.5% on the week at 9.35mn bpd following the 7.9% decline the previous week as production restarted following hurricane Harvey. There was an annual increase in production of just over 10.0%. Gasoline inventories declined a record 8.4 million barrels on the week with a 4.4% annual decline while distillate stocks fell 3.2 million barrels with a year-on-year decline of 11.2%. Refinery use fell a further 2.0% on the week due to the continuing impact of outages as flooding caused substantial damage, although markets had been expecting a recovery in capacity use for the week. Potential price support from the decline in gasoline inventories was offset by the higher than expected headline build and sharp recovery in production.
Oil futures little changed after data shows product draws, crude build - Oil futures were little changed Wednesday after Energy Information Administration weekly data showed a build in US crude stocks and draws in gasoline and distillates directionally consistent with expectations. EIA data released Wednesday covered the week ended September 8, providing insight into the full impact Hurricane Harvey had on US oil inventories and refinery operations. The loss of Gulf Coast refining capacity has caused draws in product stocks and builds in crude inventory for the last two reporting periods. The size of those swings last week was even larger than the previous week as refinery activity slowed further. Total refinery utilization fell 2 percentage points last week to 77.7%. That is down from 96.6% in the week ending August 25. US crude inventories rose 5.888 million barrels to 468.241 million barrels in the week ended September 8, EIA data showed. Analysts surveyed Monday by S&P Global Platts expected crude stocks to build 10.1 million barrels. At 1442 GMT, NYMEX October crude was up 59 cents at $48.82/b. ICE November Brent was 34 cents higher at $54.61/b. Before the release of the EIA data, NYMEX October crude was 51 cents higher at $48.74/b. ICE November Brent was 33 cents higher at $54.60/b. US gasoline stocks declined 8.428 barrels to 218.310 million barrels last week, EIA data showed. Analysts expected a draw of 4 million barrels.
Oil Prices Rise On Huge Draw In Gasoline Stocks -Crude oil prices inched up after the EIA reported a smaller-than-expected build of 5.9 million barrels in crude oil inventories for the week to September 8, after a 4.6-million-barrel build in the prior week due to the Gulf Coast refinery shutdowns.A day earlier the American Petroleum Institute had estimated crude oil inventories had risen for the second week in a row, by a hefty 6.18 million barrels, which was only to be expected as the market is prepared for the Hurricane Harvey effects on Gulf Coast refining to linger for another few weeks.Yet refineries are coming back online and they are raising gasoline production, the latest figures suggest. EIA said that last week refineries processed 14.1 million barrels of crude daily, producing 9.9 million barrels of gasoline daily. This compares with daily runs of 14.5 million bpd and gasoline production of 9.5 million bpd a week earlier.Gasoline inventories, according to the EIA fell last week, by 8.4 million barrels, generally in tune with API’s estimate of a 7.896-million-barrel decline—and the largest gasoline draw on record. This could reinforce any effect EIA’s oil inventory figures would have on prices but to what extent, remains uncertain.In its latest Short-Term Energy Outlook, out on Tuesday, the EIA said that the effect of the supply disruptions on the Gulf Coast will last for a while, which would boost the uncertainty around oil and gas prices in the coming weeks. In refining, the EIA projected an average daily rate of 15.3 million bpd for September, down from 17.1 million bpd in August. This, however, would recover somewhat in October, to an average of 15.9 million bpd, the authority said. In production, the EIA forecasts an average daily of 9.3 million bpd for this year, and 9.8 million bpd for 2018. Oil prices, which have recently received some support from reports about discussions of another possible extension of the OPEC production cut deal, remained stable following the release of the EIA report, with WTI trading at US$48.75 a barrel and Brent crude at US$54.62 a barrel.
OilPrice Intelligence Report: U.S. Shale Struggles While Oil Markets Strengthen -- WTI rose to its highest level in more than a month this week, hovering just around $50 per barrel. Brent surpassed $55 per barrel on Thursday, the highest level since the beginning of the year. Strong demand combined with easing fears about hurricane disruptions in the U.S. has pushed oil up this past week. Plus, another missile launch from North Korea kept the markets on edge. The IEA published an encouraging Oil Market Report this week, noting that global oil supply contracted for the first time in months while demand remains very robust. The Paris-based energy agency said that oil demand growth could hit 1.6 mb/d this year, an upward revision from the 1.5 mb/d estimate last month. Refined product inventories are also nearing the five-year average level, a sign that the oil market is making a great deal of progress towards rebalancing. The report also dismissed fears that the hurricanes in the U.S. would dramatically reduce demand – the agency said any effects will be “short-lived.” U.S. oil production rebounded sharply after a major disruption from Hurricane Harvey. After declining by about 750,000 bpd in the week after the storm, U.S. oil production jumped back by about 570,000 bpd last week. Still, inventories climbed again in the most recent EIA data release, with about 10 million barrels added over the two-week period. . While OPEC members have cut some 1.2 million barrels of production over the past year (plus a little less than 0.6 mb/d from non-OPEC members), that has not actually translated to the same reduction in exports. In fact, oil exports from the participating countries remain elevated, undercutting the efficacy of the agreement. The Wall Street Journal says that although OPEC agreed to cut output by 1.2 mb/d, exports have only declined by 213,000 bpd, as countries sell product from storage or otherwise reduce consumption to leave more oil for export. Saudi Arabia now wants to change that and its officials are pushing for OPEC to monitor country-level exports at its upcoming meeting on September 22.
U.S. Oil Rig Count Continues To Collapse -- The number of active oil and gas rigs in the United States fell this week by 8 rigs. The total oil and gas rig count in the United States now stands at 936 rigs, up 430 rigs from the year prior, with the number of oil rigs in the United States decreasing by 7 this week and the number of gas rigs decreasing by 1. Canada, meanwhile, added 10 oil rigs for the week ending September 15. Oil rigs in the United States now number 749—333 rigs above this time last year. Although the number of oil rigs are still up significantly year on year, the increases slowed in the second quarter, and have reversed in the third. The first quarter 2017 saw 137 oil rigs added in the United States, while the second quarter 2017 saw 97 rigs added. In stark contrast, the third quarter, for which there are still two weeks to go, has seen the total number of rigs decrease by 7. The spot price for WTI fell earlier on Friday, down 0.16 percent to $49.81 at 11:53am. Brent crude, however, was trading up 0.27 percent on the day at $55.62. Prices have been volatile in August and so far in September, with WTI going as low as $45.58 on August 31, and as high as $50.50, which it reached yesterday—the highest level we’ve seen in six weeks—as global production declined 720,000 barrels per day in August compared to July, according to OPEC’s Monthly Oil Report. It was the first drop in four months.
WTI Crude Fails At $50 Again As Rig Count Tumbles Most In 8 Months --As Texas slowly normalizes from Hurricane Harvey's impact, production has rebounded but the rig count continues to tumble (down 7 to 749 this week). This is the biggest weekly drop in oil rigs since Jan 2017 and June 2016. WTI Crude futures have once again tested $50 (and failed) this morning. This is the 5th week in a row with no increases in oil rig counts. The massive collapse in US crude production last week - with most of Texas offline - has recovered somewhat with a 572k surge in production this week. However, it is clear that levels of production are well off pre-Harvey levels... WTI retested $50 this morning, and failed, but RBOB gasoline is on the rise...“The dollar is once again weakening and that is adding some support to oil too” However, some remain bulish - “The market is realizing that demand is a lot stronger than there was given credit for,” says Phil Flynn, senior market analyst at Price Futures Group. “The untold story hidden behind the glut has been the demand growth”
Aramco Valuation Comes Under Scrutiny - Saudi Crown Prince Mohammed bin Salman says Saudi Aramco should be valued at $2 trillion for its initial public offering, but its true value will only be known when the company releases its financials next year.Because Aramco’s reserves are a staggering 266 billion barrels, the valuation of each of those barrels is particularly important. If, for example, each of those barrels get a $7 or $8 valuation, the $2 trillion valuation seems possible. But that’s not all what IPO valuations are based on.Investors use many of other metrics—financial ones—to measure an oil company’s worth, and Aramco’s finances will not be known until next year, ahead of the planned IPO.According to one such globally accepted metric for oil industry giants—enterprise value vs. earnings before interest, tax, depreciation, and amortization (EBITDA)—in order for Aramco to reach a company valuation of $2 trillion, it needs to report an EBITDA of around $130 billion next year, according to Reuters estimates.And this could prove quite challenging for the Saudi firm. No company ever—not only in the oil industry but in any industry—has reported such a high EBITDA figure, or EBITDA of more than $100 billion, according to Reuters. To compare, Apple, for example, the most valuable listed company in the world, is now worth more than $830 billion and its 2015 EBITDA was just $82 billion. Reuters data shows that Exxon Mobil reported EBITDA of $23 billion last year, and the world’s biggest listed oil firm currently has a market capitalization of $335 billion. At peak oil prices, Exxon’s EBITDA was $65 billion in 2012, but a barrel of oil is half the cost today that it was then. Core earnings at $130 billion would be necessary for Aramco to match the ambitious EV/EBITDA ratio of Exxon, Reuters calculations show.
Breaking News of Saudi Crown Prince's "Secret" Visit To Israel Brings Embassy Scramble -- Clearly the war in Syria and the international push for regime change against Assad has created strange alliances in the Middle East over the past few years. Among the strangest bedfellows are the Israelis and Saudis. It's no secret that common cause in Syria of late has led the historic bitter enemies down a pragmatic path of unspoken cooperation as both seem to have placed the break up of the so-called "Shia crescent" as their primary policy goal in the region. But that's perhaps why few pundits seemed overly shocked when Israeli media late last week began reporting that a Saudi prince made a secret visit to Israel, in spite of the fact that the kingdom does not recognize the Jewish state, and the two sides do not have diplomatic relations. Last Wednesday (9/6) Israel's state funded Kol Yisrael radio service made cryptic reference to the "secret" yet historic visit while withholding names and specifics. "An emir of the Saudi royal court visited the country secretly in recent days and discussed with senior Israeli officials the idea of advancing regional peace," the station reported. It added further that, "Both the Prime Minister's Office and the Foreign Ministry refused to comment on the issue."
"Unprecedented" Saudi Crackdown Targets Regime Loyalists As King Prepares To Abdicate -Are we seeing early signs of an "Arab Spring" coming to Saudi Arabia, or will the next king emerge stronger than ever? The kingdom is now in the midst of an unprecedented crackdown of both dissidents and even loyalists perceived as less than enthusiastic about Crown Prince Mohammed bin Salman's consolidation of power as he prepares to ascend the throne of his aging and increasingly senile father. It was only last June that King Salman shocked the world by suddenly and unexpectedly removing next in line for the crown Muhammad bin Nayef, which made Mohammed bin Salman heir apparent to the throne.In a rare front page story airing sharp criticism of the kingdom, The Wall Street Journal assessed the scope of the crackdown today:In the past week, Saudi authorities have detained more than 30 people, roughly half of them clerics, according to activists and people close to those who have been detained. The campaign goes beyond many of the government’s past clampdowns, both in the scope of those targeted and the intense monitoring of social media posts by prominent figures. It is not known if any charges have been filed. WSJ further mentions that several senior princes have been essentially under house arrest as they are barred from traveling abroad, which even includes a brother of King Salman. The kingdom has been tight lipped amidst the crackdown, refusing to engage with the media since as the story began breaking early this week.
Iraqi Kurdish parliament backs independence referendum - The parliament of Iraq's autonomous Kurdistan region has approved holding a referendum on independence on September 25 despite growing opposition from Baghdad and neighbouring countries. Kurdish MPs in the regional capital of Erbil, in northern Iraq, convened for the first time in two years on Friday and overwhelmingly decided to go ahead with the vote as planned earlier in the year.The region's vice president, Jaafar Aimenky, who chaired the session, announced the decision after 65 out of 68 politicians present voted in favour of the poll. The central government in Baghdad opposes the referendum, with its parliament having rejected the Kurdish plans in a resolution on Tuesday. Iraq's neighbours, Iran and Turkey, have also expressed their opposition to the plan as they fear an independent Kurdish state could fuel separatism among their own Kurdish populations.Friday's vote also followed the removal on Thursday of Najm Eddine Karim as the governor of the Kurdish-controlled Kirkuk. Masoud Barzani, the president of the Kurdistan Regional Government (KRG), had earlier said on Friday that the vote won't be delayed, despite pressing requests from the United States and other western powers worried that the tension between Baghdad and Erbil would distract from the war on the ISIL group.
"Like Moths To The Flame": ISIS Fighters Cut Down While Approaching Stranded Convoy -- A convoy of buses containing hundreds of lightly armed ISIS terrorists and their family members remains stuck in the Syrian desert and pinned down as US and coalition planes continue to pick off militants who stray too far from the group. External ISIS vehicles have also tried to access and aid the group, but as US coalition spokesman Army Col. Ryan S. Dillon stated, coalition aircraft are picking them off as they come close "like moths to the flame."Dillon estimated that over 40 ISIS vehicles were destroyed, including nearly 100 terrorists killed, while heading toward the convoy as the coalition has been "able to continue to just observe and pick them off one at a time.” But on Friday afternoon the US alliance announced the sudden withdrawal of its surveillance aircraft over the site at Russia's request, publishing the following statement: At approximately 7am GMT Sept. 8, Syrian pro-regime forces advanced past the 11-bus convoy of ISIS terrorists and non-combatants in the eastern Syrian desert. To ensure safe de-confliction of efforts to defeat ISIS, coalition surveillance aircraft departed the adjacent airspace at the request of Russian officials during their assault on Dawyr Az Zawyr.
North Korea slapped with UN sanctions after nuclear test - BBC News: The United Nations has imposed a fresh round of sanctions on North Korea after its sixth and largest nuclear test. The measures restrict oil imports and ban textile exports - an attempt to starve the North of fuel and income for its weapons programmes. The US had originally proposed harsher sanctions including a total ban on oil imports. Pyongyang said it "categorically rejected" what it called an "illegal" resolution. North Korea's ambassador to the UN, Han Tae Song, told a conference in Geneva: "The forthcoming measures by DPRK [the Democratic Republic of Korea] will make the US suffer the greatest pain it has ever experienced in its history." Monday's vote was only passed unanimously after Pyongyang allies Russia and China agreed to the reduced measures. The US call last week for a total ban on oil imports was seen as by some analysts as potentially destabilising for the regime. The new sanctions agreed by the UN include:
- Limits on imports of crude oil and oil products. China, Pyongyang's main economic ally, supplies most of North Korea's crude oil
- A ban on exports of textiles, which is Pyongyang's second-biggest export worth more than $700m (£530m) a year
- A ban on new visas for North Korean overseas workers, which the US estimates would eventually cut off $500m of tax revenue per year
A proposed asset freeze and a travel ban on North Korean leader Kim Jong-un were dropped. The US ambassador to the UN Nikki Haley, told the Security Council after the vote: "We don't take pleasure in further strengthening sanctions today. We are not looking for war." "The North Korean regime has not yet passed the point of no return," she added. "If North Korea continues its dangerous path, we will continue with further pressure. The choice is theirs."
Reports Confirm North Korea Has Enough Oil To Survive An Embargo -- While a full scale oil embargo against North Korea is unlikely, the reality is that North Korea would be able to survive such a measure with comparative ease. The United States has recently suggested a global oil embargo against North Korea, something both China and Russia oppose. The DPRK’s neighbours to the north support UN sanctions against Pyongyang, but have firmly opposed unilateral US sanctions against North Korea. Russia and China have made a commitment never to support sanctions against Pyongyang which could negatively impact on the civilian population of their neighbour and this would almost certainly include a full-scale oil embargo. On the contrary, Russia’s plan to de-escalate tensions on the Korean peninsula is to develop trilateral economic initiatives linking South and North Korea to Russia. Given the realities on the peninsula, Russia’s ‘carrot’ is seen as preferable on both sides of the 38th parallel to Washington’s increasingly bellicose ‘stick’. But even if Donald Trump was somehow able to convince the world to engage in an oil embargo against North Korea, North Korea would appear to have enough domestic oil reserves to make up for the loss of imports. In addition to large reserves of domestic coal and the increased reliance on green energy in the form of hydroelectric power , North Korea’s domestic oil reserves are likely far greater than previous conservative estimates have indicated. In 2015, when relations between the DPRK and the rest of the world were somewhat better than they are at present, independent oil exploration expert Michael Rego investigated North Korea’s oil potential. The results of his report paint a broadly positive picture for North Korea, a state which has always striven towards economic self-sufficiency, a principle implicit in the Juche idea of the DPRK’s founder Kim Il-Sung, which remains Pyongyang’s guiding political programme.
Chinese bank ban ‘threatens to tighten chokehold’ on trade with North Korea | South China Morning Post: Beijing has reportedly ordered Chinese state banks to suspend accounts held by North Koreans, a move that could put a tighter stranglehold on trade between the two countries. Branch offices of at least three major Chinese banks – Bank of China, China Construction Bank and Agricultural Bank of China – in the border city of Yanji, Jilin province, had suspended transactions through accounts held by North Koreans, Tokyo-based Kyodo News reported on the weekend. The branch offices in Yanji had also banned North Koreans from opening new accounts, or making deposits or remittances, the report said. But the accounts were not yet frozen, allowing the account holders to make withdrawals. South Korea-based news website DailyNK also said four major Chinese state banks – Industrial and Commercial Bank of China (ICBC), Bank of China, China Construction Bank and Agricultural Bank of China – had banned North Koreans living in China from opening up new accounts and ordered existing accounts to be closed.The ban affects all North Koreans on the mainland, from consular officials to labourers and traders. Chinese analysts said traders might still be able to find loopholes to bypass the ban but China’s decision would batter already weakened trade with its neighbour.
Crackdown Begins: Chinese Banks Are Suspending North Korean Transactions - In what may be a major breakthrough in the diplomatic and political stalemate over North Korea if confirmed officially, Japan's Kyodo newspaper reported overnight that Chinese state banks have started suspending transactions through accounts held by North Koreans,making it nearly impossible to do business between the two countries. Furthermore,Kyodo News has confirmed that branch offices of at least three major state banks - the Bank of China, China Construction Bank and Agricultural Bank of China - in the northeastern border city of Yanji have also banned North Koreans from opening accounts.The Chinese banks have yet to freeze the accounts, meaning that North Koreans can still withdraw money from them - similar to bitcoins held in Chinese exchanges - but they are now prevented from making deposits or remittances, according to the sources quoted by Kyodo. The bank restrictions, which the sources said from April were also starting to be put in force in Liaoning Province - the main region of trade between China and North Korea - suggest that China may have become more serious about curbing its nuclear ambitions,something we hinted at last week in "It Looks Like North Korea Is No Longer Playing To The Chinese Script". The restrictions also appear to be intended to help major Chinese banks avoid being hit by sanctions imposed by the United States and other countries. China, which accounts for about 90 percent of North Korea's official trade and is its major oil supplier, has long opposed taking excessively strict measures against the country, out of fear of triggering a refugee crisis on the border. China's official data show that its exports to North Korea of petroleum products, including gasoline and light oil but excluding crude oil, fell 75 percent in three months through July from a year earlier to about 19,700 tons.
China rattles critical metals supply chains: Andy Home (Reuters) - What have the following metals all got in common? Ferro-silicon, vanadium, tungsten and neodymium. The answer is that all have seen explosive price rises over the last couple of months. Ferro-silicon trading on China’s Zhengzhou Commodity Exchange went supernova over the course of August with price, volumes and open interest rocketing to record highs. Neodymium, together with its sister rare earth metal, praseodymium, has almost doubled in price since the start of the year. Vanadium has done the same in the space of two months, while tungsten is up by “only” around 60 percent since the start of July. These metals, esoteric but critical for a multitude of manufacturing processes, all have one other thing in common. They are all produced in China and they have all been hit hard by Beijing’s environmental crackdown. They are just the most extreme examples of a more general supply shock spreading across the entire global industrial metals spectrum from aluminum to zinc. ‘
North Korea: Are Sanctions Working? - The Economist argues that Western sanctions have not had much effect on North Korean economy, which is probably growing at between 1% and 5% a year. The UN has attempted to block the country’s access to hard currency by capping the amount of coal it can export, and China, the buyer in 99% of North Korea’s reported coal sales, said that it would suspend all imports. Yet North Korean vessels have continued to dock at Chinese coal ports. Moreover, countries or individuals that help North Korea do business have not been subject to “secondary sanctions” that would further isolate the country and appear to have been instrumental in persuading Iran to seek a deal over its nuclear plans in 2015. But one additional reason why the country may be proving so resilient is that its economy has also been changing. Though still officially illegal, private enterprise has grown since limited reforms made it possible for individuals to generate profit. Satellite imagery shows markets growing both in size and number across cities. These limited reforms have allowed the regime to plug part of its dollar deficit, as North Korea’s new class of traders and businessmen buy themselves protection by making hard-currency “donations” to the government. A recent report by the DailyNK investigates the state of North Korea’s market economy and the implications of proliferating marketization. In the absence of official data, the report relies on research efforts undertaken between 2014-2016 in collaboration with 32 specially-trained sources from North Korea, who reported from inside the country on conditions within their local General Markets. Daily NK was able to verify the existence of 387 officially-sanctioned markets, with residents selling from over 600,000 stalls. In population terms, over 5 million people (20% of the population) are either directly or indirectly reliant on the General Markets, solidifying their place in North Korean society. The authorities seem to have largely embraced the ability of markets to provide for people, but the report details efforts to bring the markets under control. The newly affluent middle class (donju) has become deeply involved in real estate transactions and other financial activities, leading to widening income inequality and to the emergence of a new poorer class.
Moon defying sanctions in deal to build industrial complex on North Korea-Russia border? - Korea JoongAng Daily raised eyebrows on Friday with a story that South Korea’s Moon Jae-in administration is reviewing a plan to build an industrial complex at the Russia-North Korea border.Multiple government sources reportedly told the Seoul-based newspaper that the deal is part of a trilateral economic cooperation project involving the three nations.If true, the plan would be in clear defiance of the international community’s efforts to toughen economic sanctions against Pyongyang to pressure it to end its nuclear and missile programs. It may also reflect Moon’s desire to make independent moves to defuse tensions with North Korea and an attempt by Russian President Vladimir Putin to upstage the US in the crisis.Moon attended the Eastern Economic Forum, hosted earlier this week by Russia in Vladivostok, where he met with Putin. He reportedly discussed his plans for trilateral economic projects among the two Koreas and Russia at this time. “The key of the plan is building an industrial complex at the Rajin-Khasan region at the North-Russia border,” a Seoul official told the JoongAng, on the condition of anonymity. “Before President Moon’s visit to Russia, Blue House aides and experts gathered and had a serious discussion on the plan.”
North Korea Threatens To "Sink" Japan With Nuclear Weapons, "Reduce The US To Ashes" -- Less than a day after US officials observed North Korea moving mobile missile launchersand engaging in preparations for what appears to be another missile test, a North Korean state committee has stepped up its belligerent rhetoric, threatening to use nuclear weapons to “sink” Japan and reduce the US to “ashes and darkness” after the UN Security Council passed new sanctions against the isolated country earlier this week, Reuters reported. The North also accused the US of “cooking up” the latest restrictive measures against it and demanded that the US be beaten “to death as a stick is fit for a rabid dog. These latest threats follow reports from last night that US satellites had spotted the North’s military moving mobile missile launchers and preparing hard sites for what’s expected to be the country’s fourteenth missile test of 2017. The revelations followed reports of new commercial satellite imagery confirming an earlier analysis identifying numerous landslides throughout the Punggye-ri Nuclear Test Site on the slopes of Mt. Mantap (and beyond) resulting from North Korea’s sixth nuclear test. The data suggest that the hydrogen bomb test was up to three times more powerful than previously believed.
North Korea fires ballistic missile over Japanese airspace again — North Korea on Friday fired a ballistic missile\ Friday morning that flew over Japanese airspace before crashing into the Pacific Ocean, South Korean and U.S. military officials said. The ballistic missile was launched at 6:57 a.m. Friday Seoul time (5:57 p.m. Thursday ET) from the Sunan area of Pyongyang in an eastern direction nearly around 2,300 miles, and passed over Japanese airspace, a South Korean military official said. The launch comes weeks after North Korea in late August fired a missile that traveled over Japanese airspace. Japanese Chief Cabinet Secretary Yoshihide Suga said in a televised address that the single missile launched Friday flew over Hokkaido. There are no reports of any objects falling in Japanese territory or any other damage, Suga said. "We as a nation simply cannot accept these repeated provocative acts [by] North Korea and we have lodged our firm protest and while communicating the strong anger from the Japanese public. We expressed our condemnation using the strongest of terms," Suga said. He said the missile landed around 1,242 miles east of Cape Erimo. U.S. Pacific Command also confirmed the launch and said it believes the missile launched Friday was an intermediate-range ballistic missile.
South Korea President Threatens To Destroy North "Beyond Recovery", Warns Of Accidental War - Following the latest ballistic missile launch from North Korea, South Korea's president Moon Jae-in warned that further provocations could result in the complete destruction "beyond recovery" of the northern neighbor. He also repeated tjat the possibility of opening a dialogue with the belligerent North is now gone. “In case North Korea undertakes provocations against us or our ally, we have the power to destroy (the North) beyond recovery,” the South Korean leader said on Friday according to Yonhap. Seoul immediately convened a National Security Council meeting following the latest launch by North Korea, in which Moon condemned the missile test, saying the North had once again breached United Nations Security Council resolutions and “poses a grave challenge to the peace and stability of the Korean Peninsula and the global community,” according to RT’s Ruptly news agency. “I sternly condemn and express anger at this series of provocations by the North,” Moon was quoted as saying. The South Korean president also said that dialogue between the South and the North is currently impossible and called for greater pressure on the North. “Dialogue is impossible in a situation like this,” Moon said. “International sanctions and pressure will further tighten to force North Korea to choose no other option but to step forward on the path to genuine dialogue.”
Why UN Sanctions Against North Korea’s Missile Programme Failed -- The past few months have seen the coming of age of North Korea’s nuclear weapons capability. For most of the last 20 years, the international community has been struggling to stop this from happening.A sixth nuclear test on September 3 – of what was possibly a hydrogen bomb – followed July’s two successful tests of an intercontinental ballistic missile with the capability to hit the US The same month, the US intelligence community assessed that North Korea’s arsenal consists of “up to 60” weapons, and that the country had successfully manufactured a compact warhead capable of being mounted on a missile. My research on how nation states illegally obtain missile technologies and my experience conducting outreach related to UN sanctions give me some insight into the methods North Korea used to make illicit procurements and the limitations in using technology-based sanctions to prevent them. Efforts to prevent North Korea’s acquisition of missile technology by certain nations – notably the US – had been underway since the 1990s. However, the UN sanctions went further by placing standardised legal requirements on all states to prevent the development of North Korea’s weapons of mass destruction programmes. These sanctions are “universal.” That means they are obligatory for all states around the world. Each nation is responsible for implementation within its borders. Missile, nuclear and military technologies are regulated through national export control systems. Governments must grant an export license for the exports of certain goods and technologies. In theory, all countries should have the capacity to implement these technology-based sanctions. Having an export control system has been mandatory for states since the passage of UN Security Council resolution 1540 in 2004. However, more than a decade after this resolution was passed, many nations – particularly developing ones – are still struggling with implementation. This has led the to uneven execution of missile-related sanctions on North Korea. A recent report has described the UN sanctions regime as a “house without foundations,” noting that not a single element of the sanctions regime “enjoys robust international implementation.”
The $10 Trillion Resource North Korea Can't Tap -- North Korea may not have proved petroleum reserves, but it’s estimated that the secluded belligerent nation sits on reserves of more than 200 minerals—including rare earth minerals—worth an estimated up to US$10 trillion.Of course, there are no official reports on how much North Korea’s mineral wealth really is, but according to rough estimates from earlier this decade, Pyongyang’s deposits of coal, iron ore, zinc, copper, graphite, gold, silver, magnesite, molybdenite, and many others, are worth between US$6 trillion and US$10 trillion, as per South Korean projections reported by Quartz.Before the fall of the USSR, North Korea had prioritized mineral mining and trade with fellow communist partners. But the mining industry has been in decline since the early 1990s, due to decades of neglect and lack of funds for infrastructure development to support mining activities.Now North Korea’s mining sector trade is under a full ban by the UN, as Pyongyang has stepped up both nuclear missile tests and belligerent rhetoric in recent months. The UN started banning trade in metals last year, but there have been reports that Kim Jong-Un’s regime has grown increasingly inventive in circumventing sanctions.The UN introduced last month a full ban on coal, iron, and iron ore, after having banned trade in copper, nickel, silver, and zinc in November last year. China also implemented the coal import ban, cutting off an important economic lifeline of the regime. Coal trade has generated over US$1 billion in revenue per year for North Korea, the U.S. Department of Treasury said at the end of August, when it slapped sanctions on Russian and Chinese entities for supporting the regime.On Monday, following North Korea’s latest nuclear test on September 2, the UN Security Council banned the supply, sale, or transfer of all condensates and natural gas liquids, and banned Pyongyang’s exports of textiles such as fabrics and apparel products. The latest sanctions, however, are not imposing a full oil embargo as the U.S. called for in recent weeks. The sanctions instead are capping refined petroleum products and crude oil supply, after the U.S. dropped its demand for full oil ban, to avoid China vetoing the UN resolution. All the sanctions leading to Monday’s strongest prohibitions so far have been designed to stifle North Korea’s trade in minerals and cut off money for the regime.
The Russia-China plan for North Korea: stability, connectivity - The United Nations Security Council’s 15-0 vote to impose a new set of sanctions on North Korea somewhat disguises the critical role played by the Russia-China strategic partnership, the “RC” at the core of the BRICS group. The new sanctions are pretty harsh. They include a 30% reduction on crude and refined oil exports to the DPRK; a ban on exports of natural gas; a ban on all North Korean textile exports (which have brought in US$760 million on average over the past three years); and a worldwide ban on new work permits for DPRK citizens (there are over 90,000 currently working abroad.) But this is far from what US President Donald Trump’s administration was aiming at, according to the draft Security Council resolution leaked last week. That included an asset freeze and travel ban on Kim Jong-un and other designated DPRK officials, and covered additional “WMD-related items,” Iraqi sanctions-style. It also authorized UN member states to interdict and inspect North Korean vessels in international waters (which amounts to a declaration of war); and, last but not least, a total oil embargo. “RC” made it clear it would veto the resolution under these terms. Russian Foreign Minister Sergey Lavrov told the US’ diminishing Secretary of State Rex Tillerson Moscow would only accept language related to “political and diplomatic tools to seek peaceful ways of resolution.” On the oil embargo, President Vladimir Putin said, “cutting off the oil supply to North Korea may harm people in hospitals or other ordinary citizens.” “RC” priorities are clear: “stability” in Pyongyang; no regime change; no drastic alteration of the geopolitical chessboard; no massive refugee crisis. That does not preclude Beijing from applying pressure on Pyongyang. Branch offices of the Bank of China, China Construction Bank and Agricultural Bank of China in the northeastern border city of Yanji have banned DPRK citizens from opening new accounts. Current accounts are not frozen yet, but deposits and remittances have been suspended.
Japan scrambles to growing incursions of China, Russia warplanes | Asia Times: Amid talk of Beijing and Moscow playing a role to defuse the confrontation with North Korea, actions by China and Russia’s air forces around Japan would seem to be adding pressure on Tokyo to boost military spending. Russian and Chinese military aircraft are probing Japanese air defenses at a rate not seen in over a decade, causing repeated scrambling of Japan’s Air Self-Defense Force (JASDF) jets. In the final week of August, for example, 6 Chinese H6 bombers skirted Japanese airspace as they flew between Okinawa and Miyako Island from the East China Sea for the first time, encircling Japan from the south and east. The bombers then returned home along the same flight path, a route that will be flown again, the Chinese Ministry of National Defense said. Read: The aircraft Kim Jong-un fears most. Or ought to While there was no intrusion into Japan’s airspace, the JASDF scrambled fighters to track the bombers and later inquired of China what was the purpose of the flights, then Defence Minister Fumio Kishida said at a press conference on August 25 At almost the same time, Russia dispatched its own group of Tupolev-95MS “Bear” nuclear-capable bombers, escorted by Russian Sukhoi-35S fighter aircraft and A-50 early warning and control planes. The warplanes flew from the Pacific Ocean over the Sea of Japan, the Yellow Sea and the East China Sea. Both Japan and South Korea dispatched fighters to monitor the Russian aircraft.
Rumors of Japan’s Imminent Demise Have Been Greatly Exaggerated -naked capitalism - Yves here. This is a short video on Japan. It challenges the prevailing media narrative that Japan’s aging population and high debt levels spell disaster from an economic and cultural perspective. One mild sour note was the suggestion that Australians could take on more debt than Americans have. Australia has seen a remarkable increase in personal debt levels since the early 2000s, to the point where consumers are heavily burdened by advanced economy standards. The video also has ads in the middle (!!!) but you can skip them after five seconds.
Old-Fashioned Insolvency Policy in India -- It seems to me a sign of serious regulatory dysfunction when a government expressly uses bankruptcy law as a means of collection, rather than rescue or at least collective redress, with an aim to treating economic stagnation. I've seen several stories recently like this one, touting the new Indian insolvency law and government regulators' strategy of putting pressure on banks to use involuntary insolvency (creditors' petitions) to clean up the NPL problems of a series of major industrial firms. The notion that insolvency law is about collecting NPLs seems at best anachronistic, and likely at least a sign of major dysfunction in other law or policy.The right way for one lender (including the government tax collector) to collect one defaulted loan is to engage an ordinary collections process (judgment enforcement)--which itself might well result in the sale of the company, as envisioned in the story linked above. Creditor-initiated bankruptcy/insolvency proceedings should be the nuclear option, engaged only when creditors are worried that the debtor's assets will be dissipated by other enforcing creditors before the later-in-time ones can reach the ordinary enforcement stage. Such cases should be rare. The primary users of modern insolvency law should be debtors responding to positive incentives to seek an orderly opportunity for a global renegotiation of their debts, or an orderly way for the governors of those companies to liquidate and redeploy the assets of their companies more effectively--avoiding in the process a protracted battle about their own liabilities as personal guarantors and/or as directors liable for "insolvent trading." The subtext of the stories I've seen about the new Indian insolvency law seem to be (1) it does not provide an adequate incentive for debtor-companies to seek either rehabilitation or orderly liquidation when they realize they're in obvious financial distress, (2) the ordinary collections apparatus in India must be totally dysfunctional if banks have no incentive to engage it to deal with their NPLs, (3) the new insolvency law also provides an inadequate incentive for creditors to engage it to seek collective redress, since the government has to put pressure on banks to do so, and (4) all of the work on proper, modern insolvency policy in recent years by UNCITRAL, the IMF and World Bank, and many, many others has been lost on Indian regulators.
India army chief: we must prepare for simultaneous war with China and Pakistan - India’s army chief said on Wednesday the country should be prepared for a potential two-front war given China is flexing its muscles and there is little hope for reconciliation with Pakistan. General Bipin Rawat referred to a recent 10-week standoff with the Chinese army in the Himalayas that ended last week. He said the situation could gradually snowball into a larger conflict on India’s northern border. Rawat said Pakistan on the western front could take advantage of such a situation. The Press Trust of India news agency quoted Rawat’s remarks at a seminar organised by the Center for Land Warfare Studies, a thinktank in New Delhi. India fought a war with China in 1962 and three wars with Pakistan, two of them over control of Kashmir, since securing independence from Britain in 1947. All three countries are nuclear powers. Rawat said credible deterrence did not take away the threat of war. “Nuclear weapons are weapons of deterrence. Yes, they are. But to say that they can deter war or they will not allow nations to go to war, in our context that may also not be true,” the news agency quoted him as saying. India last week agreed to pull troops from the disputed Doklam plateau high in the Himalayas, where Chinese troops had started building a road. The 10-week standoff was the two nations’ most protracted in decades, and added to their longstanding strategic rivalry. “We have to be prepared. In our context, therefore, warfare lies within the realm of reality,” Rawat said. His comments came a day after India’s prime minister, Narendra Modi, and China’s president, Xi Jinping, agreed on a “forward-looking” approach to Sino-India ties, putting behind the Doklam standoff.
Can Pakistan Economy Add 2 Million Jobs a Year? - Riaz Haq - About 20 million Pakistanis are expected to enter the labor market over the next 10 years. Can Pakistani economy add jobs at a rate of 2 million a year for the next decade to absorb all new entrants to its work force? What is Pakistan's employment elasticity? How fast must it grow to create these jobs? How much investment is needed to achieve the required growth rate? Pakistan's work force is about 68 million, according to the World Bank. Its labor force expansion is the 3rd biggest in the world after India's and Nigeria's, according to UN World Population Prospects 2017. Pakistan's working age population in 15-64 years age bracket is expected to increase by 27.5 million people to 147.1 million in 10 years, according to Bloomberg News' analysis of data reported in UN World Population Prospects 2017. Pakistan's increase of 27.5 million is the third largest after India's 115.9 million and Nigeria's 34.2 million increase in working age population of 15-64 years old. China's working age population in 15-64 years age group will decline by 21 million in the next 10 years.Employment elasticity is a measure of the percentage of new jobs added in the economy for each percentage point increase in GDP. Employment elasticity of 0.5 means that there is 0.5% growth in jobs for each 1% growth in GDP. Analysis of the World Bank jobs data shows Pakistan's employment elasticity was about 0.70 in the period from 2000-2010. A little over 5% annual GDP growth enabled the economy to add jobs at a rate of 3.6% a year for the new entrants in the labor market. Since then, Pakistan's GDP growth rate has declined along with a decrease in employment elasticity to about 0.50, according to Asian Development Bank. The ADB reports says: "With an employment elasticity of GDP growth estimated to be around 0.5, economic growth of at least 7% is required to provide sufficient jobs". Historic data suggests that it takes investment of 4% of GDP to achieve 1% GDP growth, a capital to output ratio (COR) of 4, according to Pakistani economist Mohsin Chandna. This COR ratio will require an investment of 28% of GDP to reach 7% economic growth necessary to create over 2 million jobs a year over the next decade. Pakistan's current savings rate of around 13% will clearly not be sufficient to get to the goals of 28%. This gap will need to be filled by a combination of increased savings rate and substantial increase in foreign direct investment (FDI).
UNHRC describes Rohingya crises as ‘textbook example of ethnic cleansing’ -- The United Nations' top human rights official on Monday slammed Myanmar for conducting a "cruel military operation" against Rohingya Muslims in Rakhine state, branding it "a textbook example of ethnic cleansing." Zeid Ra'ad al-Hussein's comments to the United Nations Human Rights Council in Geneva came as the official tally of Rohingya who have fled Myanmar and crossed into southern Bangladesh in just over two weeks soared through 300,000. The surge of refugees – many sick or wounded – has strained the resources of aid agencies already helping hundreds of thousands from previous spasms of bloodletting in Myanmar. "We have received multiple reports and satellite imagery of security forces and local militia burning Rohingya villages, and consistent accounts of extrajudicial killings, including shooting fleeing civilians," Mr. Zeid said. "I call on the government to end its current cruel military operation, with accountability for all violations that have occurred, and to reverse the pattern of severe and widespread discrimination against the Rohingya population," he added.
Myanmar: Whole villages destroyed as satellite spots devastation from above -- A SATELLITE map has unearthed the charred remains of entire communities as terrified residents claim they are the targets of a new-world genocide. “Some people were beheaded, and many were cut. We were in the house hiding when [armed residents from a neighbouring village] were beheading people. When we saw that, we just ran out the back of the house,” said Sultan Ahmed, a 27-year-old man from the former Chut Pyin village in Myanmar. Sultan is among a group of 1.1 million Rohingya Muslims that are often described as “the world’s most persecuted minority”. Rohingya people have lived for centuries in the western state of Rakhine, in Myanmar, but for decades have been persecuted by the Myanmar government. They are not considered among the country’s 135 official ethnic groups. The country has even denied them citizenship since 1982 and the state is one of the poorest in the country. On August 27, Myanmar state security forces and local armed-residents committed mass killings of Rohingya Muslim men, women and children. The military unleashed what it called “clearance operations”. Myanmar’s army chief justified the slaughter as “unfinished business". “The killing spree lasted for approximately five hours — from 2pm to 7pm” reported Fortify Rights. More than 2600 villages were burned down throughout the state. It is becoming one of the “deadliest bouts of violence involving the Muslim minority in decades”, according to Reuters. The violence — and ensuing exodus — saw survivors bringing with them harrowing tales of rape and murder at the hands of the military and Buddhist mobs. “My brother was killed — [Myanmar Army soldiers] burned him with the group. We found (my other family members) in the fields,” Abdul Rahman, a 41-year-old survivor of the attacks on Chut Pyin village, told Fortify Rights. In the Chut Pyin village, where some of the worst violence is believed to have occurred, Abdul said his brother was among a group of Rohingya men marched into a house by soldiers who then set it alight, burning to death all inside.“They had marks on their bodies from bullets and some had cuts.“My two nephews, their heads were off. “One was six years old and the other was nine years old. “My sister-in-law was shot with a gun.” “There are no more villages left, none at all,” Rashed Ahmed, a 46-year-old farmer from the Maungdaw Township in Myanmar, told the New York Times. He had already been walking for four days. “There are no more people left, either,” he said. “It is all gone.”
Myanmar proves 'Buddhist' doesn't necessarily mean ‘peaceful’ - Consider, if you will, two images: In one, Hollywood stars like Richard Gere chant om mani padme hum and wax poetic on the merits of peaceful Buddhism. In another—playing out in real time on your nightly newscasts—terrified Rohingiyan refugees recount horror stories of rape, murder and pillage at the hands of Buddhist extremists. In the wake of renewed violence by the Burmese military and Buddhist extremists against Rohingiyan Muslims, which many are calling genocide, it’s time to re-examine the old myth of Buddhist non-violence.This notion, popular amongst white Liberal Buddhist converts in the West, flies in the face of not only current atrocities in Myanmar, but also of historical fact. Take Tibet, for instance, where the fact that Buddhist monks violently resisted Chinese occupation is always omitted from the popular narrative. (The Dalai Lama is revered by Western liberals as a kind of living patron saint of non-violence, glossing over the more complex reality; he cheered the U.S. killing of Osama bin Laden.) Commentators often compare the Tibetan conflict to the campaign to end the occupation of Palestine, almost always contrasting “Arab violence” to “peaceful Buddhism.” But with terrible scenes of brutality on the nightly news of Rohingiyans fleeing barbaric treatment, how long can this myth be sustained? The Disneyfication of Buddhists—yet another excess of the Hollywood narrative that portrays Muslims as mad terrorists while celebrities from Uma Thurman to (ironically) Steven Seagal offer devotional praises—is indeed problematic. This myth of Buddhist non-violence, argue many Buddhist scholars, is a product of Western fantasy, rather than doctrinal reality. The “pacifist Buddhist” is a naïve, reductivist concept that doesn’t hold water—scripturally or otherwise.
The Rohingya Psyops: Waging Covert War on Myanmar -- The United Nations has accused the Government of Myanmar of committing ‘genocide’ against the Rohingya Muslim minority in the country’s troubled Rakhine State. In recent weeks the crisis in Myanmar has escalated, with human rights groups and NGOs publishing copious denunciations of the alleged human rights abuses and mass murder committed by the Myanmar Armed Forces, (Tatmadaw). The Myanmar government claims that they are fighting a war on terrorism against forces which seek to destabilise the state, Islamist forces in particular. They also claim that the so-called ethnic minority commonly referred to as ‘Rohingya’ are really illegal East Bengali immigrants. Despite thousands of serious allegations of rape, pillage and mass murder committed by these Bengali immigrants in Myanmar, human rights groups and the ‘international community’ have blamed all the violence on the Burmese authorities. Who are the Rohingya and why have they now become the focus of international attention? Why has the position of the Burmese authorities been ignored or dismissed? What geopolitical objectives could be behind an attempt to destabilise the country, as Burmese authorities have alleged? The Myanmar authorities are currently fighting a war of national liberation against two terrorist organisations called the Rohingya Liberation Organisation.(RLO), and the Rohingya Solidarity Organisation (RSO). The RLO is supported by Saudi Arabia, Pakistan, Turkey and ipso facto, NATO. Recent reports from Indian intelligence agencies have indicated that the Daesh are now recruiting Rohingya in India and sending them to Saudi Arabia for training. The Rohingya terrorists are most likely receiving arms and training from Bangladeshi military intelligence under the supervision of Turkey and the US, while the Saudis are providing the radicalisation and the cash. The Rohingya refugee story is a gigantic psyops which is intended to manipulate the emotions of ignorant mass media consumers, who do not understand the history and complex geopolitical context of Myanmar and the Bay of Bengal.
Mortgage fraud: $500b of 'liar loans' in Australia, warns investment bank UBS - Up to a third of Australian mortgages could be "liar loans" based on factually inaccurate information, investment bank UBS has warned. The global banking giant has followed up a survey of home loan borrowers that it first conducted last year, when it found evidence of widespread mortgage fraud.The latest detailed survey of more than 900 people who took out a home loan in 2017 has found that only 67 per cent responded that their mortgage was "completely factual and accurate", down from 72 per cent of 2016 borrowers.The vast majority of the mistruths appear to be white lies rather than total porkies, with a quarter of 2017 survey respondents saying their loan application was "mostly factual and accurate". Only 8 per cent admitted to their information being only "partially factual and accurate", and 1 per cent refused to say. If anything, UBS believes its survey would understate the prevalence of mortgage misrepresentations as some people would be nervous about admitting it, even anonymously."It is highly unlikely respondents would have stated that they misrepresented their mortgage application when in fact they were truthful," the bank noted in the report.Given the average turnover of home loans in Australia, UBS has estimated that around $500 billion worth of outstanding home loans contain misstatements about incomes, assets, existing debts and/or expenses.With just under $1.7 trillion of mortgage debt outstanding, that means home loans based on inaccurate or fraudulent information account for 29 per cent of the total, and 18 per cent of all private sector debt in Australia.
Hiring and Firing for the Sake of Rankings - To what lengths do departments and universities go to improve their rankings? In one case, a school is being accused of firing a number of its philosophy lecturers and using the funds to give contracts to professors elsewhere so they can have honorary appointments at the school to improve its research profile. The Australian reports that Australian Catholic University (ACU) gutted its philosophy department in favour of hiring overseas professors on $90,000-a-year part-time contracts as part of a “ruthless” strategy to artificially boost its research rankings… there are as many lecturers with strict teaching loads as there are foreign academics being paid for their existing research output. The rankings in question are Australia’s Excellence in Research (ERA) program for evaluating academic scholarship. How does the school get away with it? The practice relies on a loophole in the federal government’s ERA system that allows universities to hire academics on fractional packages and still have their work output count towards the ratings system. The rule was originally designed to allow career researchers who had children to return to work part-time and have their publishing continue. Instead, institutions are, to varying degrees, bringing in overseas academics with full-time positions elsewhere to bolster their ratings. Signing one professor from another country on such arrangements allows a university to count their entire research output for a six-year period as being connected with the Australian organisation and, in essence, produced by them.
NATO: Turkey didn’t inform alliance about S-400 purchase from Russia -- NATO said on Wednesday that Turkey had not informed the alliance of details of its agreement to purchase an S-400 air defense system from Russia. According to the Sputnik Turkish service, a NATO official whose name was not revealed told Sputnik that none of the NATO members currently use the S-400 and that it was not informed by Turkey of the details of the S-400 purchase from Russia. Russian officials had earlier said said that they would not share any information about their sale of its S-400 air defense system to Turkey due to the sensitivity of the issue. Therefore, the total amount of the purchase and the number of batteries sold to Turkey are not known. After Turkish President Recep Tayyip Erdoğan announced on Tuesday that Ankara had signed a deal with Russia to buy an S-400 missile defense system despite opposition from NATO allies, Pentagon spokesman Johnny Michael said the US has relayed its concerns to Turkish officials over the purchase. In a written statement to CNBC on Tuesday, Michael said that a NATO inter-operable missile defense system remains the best option to defend Turkey from the full range of threats in the region and added, “We have relayed our concerns to Turkish officials regarding the potential purchase of the S-400.”
Series Of "Almost Simultaneous" Bomb Threats Forces 10,000 In Moscow To Evacuate - Following a series of "almost simultaneous" warnings that shopping centers, railway stations and university buildings in Moscow had been rigged with explosives, authorities ordered the evacuation of more than 10,000 people on Wednesday.“Twenty sites are currently being evacuated, and more than 10,000 people have been escorted out, though the specific number is still being confirmed,” an emergency services source told news agency Tass.“This appears to be a case of telephone terrorism, but we have to check the credibility of these messages,” said the source, who noted that the calls began at the same time, and continued after the evacuations had begun. Emergency services said that specialist units equipped with bomb-sniffing dogs were searching the locations, according to Russia Today. The source, or sources, of the threats have not yet been identified. Among the affected areas include Moscow's largest railway stations, more than a dozen shopping centers, including GUM, located next to Red Square, and at least one university - though there have been unconfirmed reports of an evacuation at another school. Luckily for commuters, TASS reported that the police investigation had not interrupted service on the city's metro line. Video from the evacuation at one Moscow mall can be viewed below:
Hundreds Of Tanks And Howitzers From The United States Arrive In Poland -- One day before Russia kicked off its "Zapad 2017" military exercise, dubbed the "biggest display of Russian military power since the end of the Cold War", on September 13 American military equipment arrived in the port of Gdansk, Radio Poland reports, where more than a thousand pieces of American military equipment from the Second Anti-tank Brigade Combat Team were unloaded at the port, including Abrams tanks, Bradley combat vehicles, Paladin howitzers and other combat equipment. This is the first shipment of equipment to arrive in Poland under the initiative Operation Atlantic Resolve according toUA Wire. According to the General Commander of Poland’s Armed Forces, General Jaroslaw Mika, the equipment will be used during military exercises.“This military equipment, which we see today, will be located in the western part of Poland. I mean, first of all, in such areas as Boleslawiec, Zagan, Torun, Swietoszow, and Skwierzyna. This equipment will be used in various maneuvers and training. This is a brigade fighting group. At this point, I want to emphasize the scale of the Dragon 17 exercises. This is 17,000 soldiers from 11 countries. I think that these figures are quite impressive if we are speaking about the activity of the NATO member countries, as well as the use of America’s potential,” he said.On Thursday, the first train with American weapons departed for the place of permanent deployment.The goal of Operation Atlantic Resolve, as discussed previously, is to assure the continued presence of U.S. troops in Central and Eastern Europe. The Dragon17 exercises, which will be held September 25-29, will be the largest exercise held this year in Poland.
Merkel ally says website hit by thousands of cyberattacks from Russian IP addresses ahead of election -- The vice chairman of German Chancellor Angela Merkel's conservative party Christian Democratic Union (CDU) said on Monday (4 September) that her website was recently hit with thousands of cyberattacks, many of which came from Russian IP addresses. Julia Kloeckner said the political website was the target of about 3,000 attacks ahead of the television election debate between Merkel and her Social Democratic rival Martin Schulz on Sunday, Reuters reports. "Many of the senders have Russian IP addresses," Kloeckner said, adding that the party's headquarters in the state of Rhineland-Palatinate also suffered "massive attacks" before the televised debate.In a tweet on Sunday, Kloeckner wrote in German: "Today a massive hacking attack on my homepage - with greetings from Russia. [As] if this has something to do with the election."She did not specify any details regarding the type of cyberattacks or how they were discovered.A CDU spokesperson said around 3,000 emails allegedly requested unauthorised access to the administrator rights of Kloeckner's website and were likely sent from a Russian server, Politico reports. A spokesman for Germany's federal cybersecurity agency BSI said they were aware of the attacks and were in contact with CDU's headquarters. German officials and intelligence agencies have previously warned that Moscow could seek to interfere in the upcoming national election on 24 September in which Merkel is expected to win a fourth term.
Germany needs a frank debate, not this tepid election campaign – Yanis Varoufakis Op-ed in Deutsche Welle - That the federal election campaign is proving such a tepid affair is a reflection of the false sense of security generated by Germany’s three surpluses: Companies save, households save, the Frankfurt banks are awash with monies sent to them from other European countries, even the federal government budget is in surplus. But these surpluses are the sign of weakness, not strength. They are the harbingers of significant current and future hardship for most Germans now and in the future.Think about it for a minute: A current account surplus of almost 10% of national income means that the nation must take its savings and send it abroad to be invested in deficit countries. Is this a prudent thing to do, especially when German capital abroad is creating bubbles bound to burst (like they did in Greece and Spain)?Also, how smart is it to rely on the money influx into the Frankfurt banks to cover up their insolvencies, especially when this tsunami of foreign monies is flooding Germany because their Italian or French owners are losing hope in their own countries’ economy? Finally, how rational is it for the federal Finance Ministry to celebrate a budget surplus that is due to the negative interest rates which (a) are crushing German pension funds and (b) causing the famed Swabian housewife to lose faith in the German political establishment? Germany needs a frank debate among its citizens on how to deal with the threat that its surpluses are posing to German society, just as much as Greece needed a similar debate, some time ago, on the threat posed by our deficits. After all, for every surplus there must a deficit somewhere else within a monetary union. To have the political establishment celebrate imbalances as signs of economic health, just because Germany is blessed with their surplus side, is to misrepresent to the German public a source of troubles as evidence of success.
Europe’s Globalists Tackle the Immigration Class War - A few months ago, French president Emmanuel Macron launched a new policy platform to protect France’s lowest paid from foreign competition: Emmanuel Macron warned Europe must accept the UK was crashing out of the bloc because of worries about foreign workers undercutting wages.The intervention is a striking departure from EU rhetoric since Britain’s Brexit vote a year ago which has been dominated by demands for the EU’s principles to be defended.Mr Macron used his first newspaper interviews since winning the Elysee to endorse tightening up rules on freedom of movement.He told the Guardian: ‘The great defenders of this ultra economically-liberal and unbalanced Europe – the UK – came crashing down on this.‘What did Brexit play on? On workers from eastern Europe who came to take British jobs.‘The defenders of the European Union lost because the British lower middle classes said: ”Stop!”’ Today he adds, via Reuters: French President Emmanuel Macron on Wednesday won the support of two eastern European states in his campaign against EU rules on the employment abroad of workers from low-pay countries, calling the current system a “betrayal” of European values.Macron has pledged to overhaul a system under which “posted” workers can be sent to other European Union states on contracts that must guarantee the host country’s minimum wage, but under which taxes and social charges are paid in the home nation.He says the system creates unfair competition in wealthier nations like France and Austria, a country that borders four eastern European countries and where on Wednesday he met Chancellor Christian Kern, an ally on this issue. Interestingly, he is also trying to liberalise the labour market internally tackle high unemployment:
Juncker Talks The Talk: Who Will Walk The Walk? - Jean-Claude Juncker’s 2017 State of the European Union (SOTEU) speech was marked, particularly compared with last year’s offering, by a renewed sense of optimism, but also by the urgency of serious institutional reform. The overall thrust of his message is that the EU now has the wind in its sails and must seize the opportunity to push ahead, taking further steps to underpin the integration process. That the wind has changed tack is evidenced by the defeat, for now at least, of the populist surge, the slo-mo train-wreck that is Brexit – which has revealed much anti-European rhetoric as simple untruths, and brought home the advantages of close economic integration – and not least the steadily improving economic situation, which has now broadened to many countries badly mauled by the crisis. Unemployment, as Juncker noted, is at a 9-year low. Perhaps aware of the criticism that the EU is seen as too technocratic and fails to inspire emotions, the Commission President did emotion with a capital E, intertwining personal reminiscences with appeals to values including equality, freedom, the rule of law and transparency. But it was not just mood music. In terms of more concrete initiatives – and focusing here on economic and social issues – the SOTEU speech called for a range of, in some cases, new and far-reaching institutional reforms. In the social and employment sphere Juncker promised to create a common “Labour Authority” to ensure fairness in the single market. He called for rapid agreement on the Pillar of Social Rights – even if we know that this is of limited value in itself – and work towards a European Social Standards Union: while national social systems remain diverse there must be agreement on certain minimum standards. He explicitly mentioned the debate on the posted workers’ directive and showed, presumably not least in the wake of remarks by Emmanuel Macron, an awareness of the need to balance interests of workers from high and low income countries. Similarly on trade, the Commission has learnt from the divisive TTIP debate, its President promising to publish draft negotiating mandates and calling on the Council to do the same with the final mandate.
Britain will regret leaving the European Union: Juncker- Britain's departure from the European Union in March 2019 would be "a very sad and tragic moment in our history", said EU Commission president Jean-Claude Juncker Wednesday, and they will regret it.Mr Juncker was delivering his annual speech on the State of the European Union to the European Parliament. He said the EU would "always regret this", as he suggested would the UK. But the EU had to respect the will of the British people, he said, and the EU would "will move forward, because Brexit is not the be-all and end-all".The annual speech to MEPs takes stock of Europe's current political and economic landscape. It is an opportunity to review the work of the EU over the past year, and to look ahead to the priorities of the coming year.This year's speech was accompanied by adoption by the EU executive of concrete initiatives on trade, investment screening, cybersecurity, industry, data and democracy, putting words immediately into action.A series of factsheets published expand on some of the key elements touched upon in president Juncker's speech.The state of the Union's economy was improving, he said, with the fifth year of economic recovery reaching every single Member State. He said growth in the EU stands above 2 per cent for the Union as a whole and 2.2 per cent for the euro area - outstripping that of the United States over the last two years.Unemployment, he said, was at a nine year low, and almost 8 million jobs had been created during his tenure: "With 235 million people at work, more people are in employment in the EU than ever before."Mr Juncker said his Commission could take credit for the European Investment Plan, which triggered EUR 225 billion worth of investment so far, granting loans to over 445,000 small firms and more than 270 infrastructure projects. It also could take credit, he said, for having brought public deficits down from 6.6% to 1.6%, "thanks to an intelligent application of the Stability and Growth Pact." "The wind is back in Europe's sails," Mr Juncker told the MEPs: "Now is the time to build a more united, stronger and more democratic Europe for 2025."
EU immigration offer could lead to Brexit reversal, claims Adonis -- The decision of the British people to leave the European Union could be reversed next year if France and Germany agree that the UK can take control over immigration while staying in the EU single market, the former Labour cabinet minister Lord Adonis said on Sunday. With concern over the government’s handling of Brexit growing ahead of a key parliamentary vote on Monday, the peer said Angela Merkel, who is expected to be re-elected as German chancellor later this month, and French president Emmanuel Macron could well make such an offer if they believe it could mean the UK remaining in the EU. Writing in the Observer, Adonis said he believes a majority of peers in the House of Lords will support an amendment to the EU withdrawal bill – now passing through the Commons – requiring another referendum before Brexit takes effect, with the options being to accept the deal on offer, or stay in the EU. Such an amendment for another national vote, Adonis said, would stand a good chance of being passed by the House of Commons because Labour would by then have reason to support it, and sufficient pro-EU Tories would also rally behind it, he argues. “The interplay between a referendum and such a Merkel-Macron ‘offer’ will be vital,” he writes. “If it is clear by next summer that Britain is going to hold a referendum, then the incentive for them to make a bold offer greatly increases.” He adds: “A lot depends upon whether the alternative is the status quo – or EU membership without freedom of movement in respect of right to work and right to reside for all EU nationals. If Chancellor Merkel and President Macron make an offer, probably over the heads of the British government, for the UK to stay in the economic institutions of the EU but with national control over immigration, then I believe the referendum can be won. “Why might Macron and Merkel make this offer? Partly because – in Macron’s case – he (rightly) doesn’t believe that unrestricted free movement of labour is integral to the single market. Partly because many other EU leaders agree with him. And partly for the big strategic reason – which weighs on strategic thinkers in Berlin – that, if Britain leaves the EU, 80% of Nato resources will then be outside the EU, which is hardly a recipe for European security and stability if you are looking across at the Russian and Chinese bears.”
Brexit: Deportations of EU citizens soar since referendum | The Independent: As Home Secretary, Theresa May introduced new regulations saying EU citizens who are sleeping rough should be deported Getty The number of EU citizens the Government is deporting from the UK has rocketed since the Brexit vote, despite ministers' promises to guarantee residents’ rights, The Independent can reveal. Analysis of official government data shows there were 26 per cent more enforced removals of EU nationals in the first three months of 2017 than in the same period last year. Almost 5,000 EU citizens have now been deported from Britain in the last 12 months: the highest since current records began and an increase of 14 per cent in the last year alone. The figures come after a leaked Home Office memo revealed comprehensive plans to significantly restrict immigration from Europe when Britain leaves the EU. Meanwhile, Tony Blair yesterday called for tough new rules to allow Britain to curb EU immigration to change voters' minds about Brexit. The former Prime Minister admitted open borders were no longer appropriate, putting his name to a report urging tighter domestic controls and restrictions to free movement negotiated within the EU. Human rights campaigners told The Independent that many of the removals are illegal, while Labour called the figures “disgraceful” and said they could make Brexit talks more difficult. The policies causing the clampdown are currently being challenged in UK courts.
Post-Brexit customs checks could cost 4 billion pounds a year, study says (Reuters) - The introduction of post-Brexit customs checks could cost traders more than 4 billion pounds ($5.28 billion) a year, according to a think tank report released on Monday. The British government has said it plans to leave the European Union’s customs union when it leaves the bloc, and it wants to negotiate a new relationship that will ensure trade is as free of friction as possible. In its report ‘Implementing Brexit: Customs’, the Institute for Government said the government needed to offer as much certainty as possible to business and help them plan for changes to customs. Around 180,000 traders now operate only within the EU and face making customs declarations for the first time after Brexit. The government estimates an extra 200 million declarations a year will be made. Those declarations cost 20 to 45 pounds each, the IfG said, putting the total additional cost at 4 billion to 9 billion pounds. “The scale and cost of change for many traders could be significant. Government must engage with them in detail about changes, understanding their requirements and giving them as much time to adapt as possible,” the report said. The government has proposed two options for the future customs relationship. One is a system using technology to make the process as smooth as possible; the second a new customs partnership removing the need for a customs border. It wants a transition period after Britain leaves in March 2019 to allow time to adapt. However, the EU says negotiating the customs relationship must wait until the two sides have made make progress on the rights of expatriates, Britain’s border with EU member Ireland and a financial settlement.
Tory MPs threaten revolt if European withdrawal bill is not amended - Senior Tory MPs warned ministers yesterday that they would have to accept changes to their flagship Brexit legislation or face defeats when the bill returns to the Commons next month.Ministers last night won a comfortable victory at the European withdrawal bill’s second reading, with seven Labour MPs joining the DUP in supporting the government and no Conservative MPs voting against it. After more than 13 hours of debate, the government secured a majority of 36, with 326 votes for and 290 against.After the vote Theresa May said: “Parliament took a historic decision to back the will of the British people and vote for a bill which gives certainty and clarity ahead of our withdrawal from the European Union. “Although there is more to do, this decision means we can move on with negotiations with solid foundations and we continue to encourage MPs from all parts of the UK to work together in support of this vital piece of legislation.” Sir Keir Starmer, the shadow Brexit secretary, described the result as deeply disappointing.“This bill is an affront to parliamentary democracy and a naked power grab by government ministers,” he said. “It leaves rights unprotected, it silences parliament on key decisions and undermines the devolution settlement. It will make the Brexit process more uncertain and lead to division and chaos when we need unity and clarity.” The Conservative chairmen of four select committees had said earlier that the government would have to make significant amendments to the bill, which embeds EU law in British law, to maintain unity.
Brexit bill passes first British parliamentary hurdle — British Prime Minister Theresa May overcame a major Brexit hurdle as her bill to transfer the body of EU law onto the U.K. statute books progressed with the support of a majority of MPs. A rebellion by seven Labour MPs who defied leader Jeremy Corbyn’s orders to vote down the new law helped ensure the EU (Withdrawal) Bill comfortably passed a second reading with a majority of 36, meaning it progresses to the next stage in the law-making process where it is scrutinized line-by-line in committees.Conservative rebels gave the government the benefit of the doubt in this early stage in the lawmaking process, but the prime minister still faces an uphill battle to turn the bill, which will repeal the 1972 European Communities Act that took the U.K. into the European Community and later the EU, into law. A raft of Conservative MPs vowed to attempt to curb temporary powers included in the bill in “committee stage” — when bills are scrutinized by a smaller group of MPs who vote on specific sections and add amendments — before it returns to the floor of the House of Commons for its report stage in October, where the amended bill can be debated and further amendments proposed.In a statement following the vote, Steve Baker, the minister for exiting the European Union, said the government would “look with the utmost seriousness at the amendments that are tabled.”He said: “It is essential that we work together to deliver a bill that ensures a functioning legal system outside the EU.” While May survived the early parliamentary Brexit skirmish, with MPs concluding two full days debating the principles of the bill Monday night, she faces many more controversial tests in the months ahead. With many of her party at odds over the shape of Britain’s post-Brexit future on issues like immigration and the economy, she could face much tighter votes than the EU (Withdrawal) Bill, which is seen a crucial to a “smooth” Brexit.
How Not to Do Trade Deals - About half of Britain’s trade and investment is with the EU, and currently, as members, we implement almost the same standards for products and services. One of the few concrete things stated in the government’s white paper on Brexit was its intention to establish UK trading schedules – including import tariffs and quotas – at the World Trade Organisation, replicating ‘our existing trade regime as far as possible’. If no trade deals were struck with the EU after Brexit, the EU and UK would need to charge each other the tariffs they charge other WTO members. The average tariff rate is low – around 1.5 per cent – but some products attract higher tariffs. Cars, for example, incur a 10 per cent tariff, which the head of European manufacturing at Nissan stated would be a ‘disaster’ for the UK industry. Tariffs also have an effect on the price of food. The pound’s loss of around 10 per cent of its value after the Brexit referendum may have benefited certain export industries and increased the number of tourists coming to the UK, but food price inflation – which until Brexit had been negative – contributed to overall inflation hitting its highest level in four years, at 2.9 per cent. Hard Brexiters often see leaving the EU as an opportunity to drop tariffs completely, which could reduce prices for British consumers. When it’s no longer a member of the customs union, the UK would be free to set its own tariffs, or could unilaterally decide to abolish them. But tariff levels are an important bargaining chip: if the UK drops its import tariffs without getting reciprocal access to foreign markets, it would be hard for prices to fall enough to make up for the job losses incurred in industries that would face competition from imports. Since tariffs are higher in manufacturing, higher job losses would be likely in areas of the UK that are already in economic difficulty.
Brexit Talks Stall, Making Hard Brexit Even More Likely - Yves Smith - While the progress of the Great Repeal Bill through the House of Commons is the big Brexit event this week, far more important was the impasse between the UK and EU negotiators in their third round of face-to-face talks at the end of August. The Brits thumbed their noses at the EU side by blowing off the first day, which occurred on a bank holiday Monday. While David Davis and his team did show up that day and made a short statement along with his counterpart, Michel Barnier, the talks, such as they were, didn’t start until Tuesday at 11:30 AM….which I guesstimate is about when a UK team would have been ready to go to work if they had taken the very first flight that morning out of London to Brussels. Things did not get better as the week went on. There was a near-total dearth of any progress. The UK kept insisting that the EU include a future trade deal in this phase of the talks, when the EU has made clear from the outset that that is off the table until enough progress on the divorce issues are resolved, in particular the three teed up for this round: the movement of people, the so-called exit bill, and the Northern Ireland border. The really embarrassing part of this UK effort to renegotiate the shape of the table is that the Brits might actually think their gambit might succeed, as opposed to simply grandstanding for the benefit of Brexit fans. If the Foreign Office were competent, a question that really is in doubt, it would recognize that the EU cannot negotiate these issues even if Barnier wanted to. Barnier and his team had to obtain approval for his brief from the 27 remaining EU members, which he got at the end of May, and he does not have the latitude to go beyond those parameters. 1 What is so disconcerting, even at this remove, is that the UK’s delusion hasn’t dissipated in the slightest. It instead has taken new, creative forms. For instance, the UK produced a series of position papers before the August session and seemed really chuffed about them. They were typically 12-14 pages each. The EU’s documents on the same issues, by contrast, had already been out and were typically over 100 pages. And that isn’t due to Eurocrat verbosity. These are complex issues. A 10-20 page document is a napkin doodle relative to the level of specificity needed.
Explosion, Fire In London Subway Train Treated As "Terrorist Incident" --London police are responding to “a terrorist incident” at Parsons Green tube station in London, following an explosion on a packed rush-hour commuter train on Friday morning. Several people have been reportedly injured.The Met’s Counter Terrorism Command are investigating after the incident at#ParsonsGreen tube station is declared a terrorist incident— Metropolitan Police (@metpoliceuk) September 15, 2017The details of the incident weren’t immediately clear, but witnesses described what sounded like an explosion and a burst of flames on a car of a train as it was stopped at the Parsons Green station in West London. They described panic and chaos as passengers rushed to flee across a crowded platform during the morning rush hour. The Metro newspaper reported that passengers had suffered facial burns from a blast and others had been hurt in a subsequent stampede. “I was on second carriage from the back. I just heard a kind of whoosh. I looked up and saw the whole carriage engulfed in flames making its way towards me,” a man who was on the train told Reuters.“We are aware of an incident at #ParsonsGreen tube station. Officers are in attendance,” London police said on Twitter. Parsons Green subway station in west London was cordoned off as counter-terrorism police investigated, the Metropolitan Police said in a statement. A number of people were injured, the Met said, and the Press Association said passengers suffered facial burns and some were hurt in a stampede.
Amazon in £1.5bn tax fraud row The tax authorities accused Amazon yesterday of failing to co-operate fully in tackling a multibillion-pound fraud that is putting scores of small British companies out of business. Figures from HM Revenue & Customs suggest that foreign companies selling goods through websites such as Amazon and eBay are evading tax on up to a third of all sales. Meanwhile, the online giants make millions of pounds in commission.Parliament’s public accounts committee (PAC) was told yesterday that, more than five years after concerns were raised, Amazon was not providing “complete transparency” on the foreign retailers that were using its site. Privately HMRC believes that the US online marketplace is being obstructive in providing data that could help it to crack down on the fraud, which is costing taxpayers £1.5 billion a year.“We need to be clear that there is not complete transparency between our organisations,” Jon Thompson, the head of HMRC, told the committee of MPs. “It is true to say that online marketplaces can access our systems to validate VAT [registration] but you should not fall into assuming that we have transparency back the other way.” The PAC was told that Amazon stocked, dispatched and collected the money from products sold by 23,000 non-EU companies from its British warehouses, many of which were suspected of avoiding the 20 per cent tax.Amazon has not checked whether all these companies are registered for VAT in Britain, let alone whether they are making tax declarations. Overall HMRC estimates that online VAT fraud costs the taxpayer between £1 billion and £1.5 billion a year on sales of £7.5 billion. In the online British retail market, estimated to be worth £26 billion last year, MPs said the figures suggested that up to a third of all transactions were fraudulent.
How top firms would have been blacklisted on fat cat pay - Almost a third of Britain’s biggest firms have suffered a revolt on pay that would have seen them blacklisted under the Prime Minister’s plans to ‘name and shame’ greedy bosses, a major investigation by The Mail on Sunday has found.The analysis of about 400 documents over four years reveals the extent to which firms are feathering the nests of their highest paid executives in a system that appears to be out of control.The investigation reveals that the boardroom pay and incentive plans of 30 of the 100 largest companies listed on London’s stock market have faced a rebellion of more than 20 per cent of shareholders – the limit of tolerance set by Theresa May last month. Of those, 19 have faced pay revolts in the past two years, suggesting the problem is worsening, with the divide widening between executives and rank and file staff, who are receiving far meaner pay rises.Among the worst offenders are Morrisons – with the pay awarded to both former boss Dalton Philips and his replacement at the supermarket Dave Potts under fire – as well as advertising giant WPP and construction supplier Ashtead. All have been struck by three pay revolts in the past four years. A further six have two rebellions blighting their name, including pharmaceutical giant AstraZeneca, fashion label Burberry, software developer Micro Focus, healthcare provider NMC Health, publisher Pearson and consumer goods maker Reckitt Benckiser. Theresa May described the trend to higher pay and more generous perks for top bosses as the ‘unacceptable face of capitalism’.
Cambridge University set to scrap written exams because students’ handwriting is so bad - Cambridge University is seeking to scrap exams written with a pen and paper due to the deterioration of students’ handwriting. A growing reliance on laptops has led to students’ writing becoming increasingly illegible, academics said.The problem has become so bad the university is preparing to switch to examinations on laptops – ending 800 years of handwritten exams. Dr Sarah Pearsall, a lecturer at the university’s history department, told The Telegraph: “As a faculty we have been concerned for years about the declining handwriting problem.“There has definitely been a downward trend. It is difficult for both the students and the examiners as it is harder and harder to read these scripts.”When examiners could not read scripts, they had to be transcribed centrally, meaning a growing number of students had to return to university during the summer period to read their answers aloud to administrators, she said.
Death By Political Correctness: Student Charged With Islamaphobic "Hate Crime" After Mocking ISIS On Facebook - Robbie Travers, a 21-year-old law student, is being investigated by the University of Edinburgh for claims he committed a “hate crime”. Sharing a comment on his Facebook page – in response to the U.S. Air Force dropping a massive ordinance air blast (or MOAB, “Mother Of All Bombs) on a network of ISIS tunnels in Afghanistan in April – Travers said: “Excellent news that the US administration and Trump ordered an accurate strike on an ISIS network of tunnels in Afghanistan. I’m glad we could bring these barbarians a step closer to collecting their 72 virgins.”A complaint with the University was filed by a second-year history student that alleged Travers’ comment “put minority students at risk and in a state of panic” while also breaching the student code of conduct – with Edinburgh Uni even going so far as to open a probe over Traver’s plainly horrific comment obviously directed toward terrorists! Plainly, Travers should have known better than to dare to criticize any aspect of Islam – seeing as how, in June, a man was jailed for anti-Islam posts on Facebook and 36 people accused of hateful social media posts had their homes raided! Sadly, Robbie Travers is another notch in the rope of political correctness gone wrong across the pond…
No comments:
Post a Comment