Powell says balance sheet will be 'substantially smaller' - The Federal Reserve's balance sheet will be reduced significantly from where it is now, Chairman Jerome Powell said Thursday in remarks signaling that more monetary tightening is ahead. Powell did not specify how much smaller the central bank's portfolio of bonds would get, but the remark seemed to take some momentum out of the stock market during afternoon trading."It will be substantially smaller than it is now," the chairman said during a discussion at the Economic Club of Washington. "It will be smaller than it is now, but nowhere near where it was before."The Fed had been holding about $4.5 trillion worth of mostly Treasurys and mortgage-backed securities that it accrued during three rounds of monetary stimulus during and after the financial crisis.Starting in October 2016, the Fed began allowing a fixed cap of proceeds from those bonds to run off each month, with the level now reaching a ceiling of $50 billion. The Treasury and MBS holdings have contracted by about $400 billion since the operation began. The overall balance sheet is now below $4 trillion.The balance sheet roll-off has been referred to "quantitative tightening" as opposed to the "easing" that beefed up the balance sheet.Wall Street has questioned whether the Fed should be cutting the balance sheet at the same time it is raising its benchmark interest rate. The policymaking Federal Open Market Committee approved four rate hikes in 2018 and has indicated perhaps two more are ahead this year.Fed officials have said they expect the run-off to happen without disruption — former Chair Janet Yellen likened it to "watching paint dry" — and Powell defended the operation during his chat Thursday with David Rubenstein, co-founder of the Carlyle Group, where Powell once worked."We wanted to have the balance sheet return to a more normal level, which is a level no larger than it needs to be for us to conduct monetary policy," he said.Minutes from the December FOMC meeting show some concern over where the process is headed. Fed economists cautioned that the federal funds rate that the c entral bank uses as its benchmarkcould become volatile during the roll-off.
FOMC Minutes: "Committee could afford to be patient about further policy firming" - From the Fed: Minutes of the Federal Open Market Committee, December 18-19, 2018. A few excerpts: With regard to the outlook for monetary policy beyond this meeting, participants generally judged that some further gradual increases in the target range for the federal funds rate would most likely be consistent with a sustained economic expansion, strong labor market conditions, and inflation near 2 percent over the medium term. With an increase in the target range at this meeting, the federal funds rate would be at or close to the lower end of the range of estimates of the longer-run neutral interest rate, and participants expressed that recent developments, including the volatility in financial markets and the increased concerns about global growth, made the appropriate extent and timing of future policy firming less clear than earlier. Against this backdrop, many participants expressed the view that, especially in an environment of muted inflation pressures, the Committee could afford to be patient about further policy firming. A number of participants noted that, before making further changes to the stance of policy, it was important for the Committee to assess factors such as how the risks that had become more pronounced in recent months might unfold and to what extent they would affect economic activity, and the effects of past actions to remove policy accommodation, which were likely still working their way through the economy. Participants emphasized that the Committee's approach to setting the stance of policy should be importantly guided by the implications of incoming data for the economic outlook. They noted that their expectations for the path of the federal funds rate were based on their current assessment of the economic outlook. Monetary policy was not on a preset course; neither the pace nor the ultimate endpoint of future rate increases was known. If incoming information prompted meaningful reassessments of the economic outlook and attendant risks, either to the upside or the downside, their policy outlook would change.
FOMC Minutes Signal Patient Fed And Dovish Sentiment- Downside Risks Increased - As a reminder, the FOMC raised the fed funds rate target by 25bps in December, in line with the analyst median forecast. The central bank also narrowed the trajectory of rate hikes going forward, now envisaging two hikes in 2019, and one in 2020 (previously it had seen three hikes in 2019 and one in 2020). Crucially, the FOMC lowered its estimate of the neutral rate (to 2.8% from 3.0%), and additionally, the central bank softened its guidance on future rate hikes, saying that “some further gradual increases” to rates (versus the previous “further gradual increases”), even as the market continues to expect that the Fed's rate hike cycle is now over and even expects a rate cut in 2020. In terms of risks to the outlook, the Fed continues to see these as “roughly balanced”. But the market is entirely rejecting The Fed's messaging and today's Minutes may hold some color for just how hawkish or dovish The Fed really is... And, since The Fed hiked rates in December, stock markets have turmoiled back to unchanged. However, one look at the chart below shows that it was in fact only stocks that were chaotic - the trend higher in bonds and bullion (and lower in the dollar) was relatively smooth... And at the same time as stocks have yo-yo'd so has the market's expectations for just how dovish The Fed will be this year...the Minutes revealed that the Fed took a more dovish approach to further rate increases than the statement indicated. “Many participants expressed the view that, especially in an environment of muted inflation pressures, the committee could afford to be patient about further policy firming,’’
Trio Of Fed "Hawks" Unleash Wave Of Dovish Calm Over Stock Market - According to the latest Reuters meter of Fed "doves and hawks", the Atlanta Fed's Bostic, Boston Fed's Rosengren and Chicago Fed president Charles Evans are all Hawks and, at worst, centrists. None of them is seen as a dove, per se. And yet the trio of Fed "hawks" were scrambling over each other who could be more dovish today during their various speeches, confirming that the Fed has indeed undergone a seachange in sentiment, from being starkly hawkish as of the December FOMC meeting just three weeks ago, to uber dovish following Powell's dramatic retreat last Friday.The non-voting in 2019 Bostic was first, saying the Fed should be cautious about making additional interest rate hikes because rates are now close to neutral and businesses are uncertain about the outlook: "My view is that a patient approach to monetary policy adjustments in the coming year is fully warranted in light of the uncertainties about the state of the economy and about what level of policy rates is consistent with a neutral stance." Bostic said that "all the available evidence at the moment points to caution regarding firms’ approach to expansion’’ and added that "as long as that caution exists, I suspect it will act as a natural governor, limiting inflationary forces without the need for a muscular stance of policy."A dovish Bostic was followed by an equally dovish (and non-voting in 2019) Chicago Fed president Charles Evans, who said that while he still expects 3 rate hikes in 2019 if his forecasts are met, added that "we’re at a point where inflationary pressures are not evident" and claimed that "we do have capacity to not adjust rates for some period of time." Speaking with reporters after a speech in Riverwoods, Illinois, Evans said that "there’s no hurry in getting” Fed policy into restrictive territory and that "It could be that neutral is actually a little bit lower than what I just said, and if in fact we’re arguably at a lower range for neutral, that means we could be at neutral, and so if the inflation data didn’t move up." The trio of hawks doves concluded when Boston Fed President Eric Rosengren said China’s economy faces a combination of problems and he worries it may slow more than anticipated, in effect pulling a "Yellen" who blamed the massive delay in rate hikes in 2016 on China. Commenting on the US markets, Rosengren said they ended 2018 on a sour note that raises a concern about the durability of the expansion, even though the market's reaction clearly left him surprised, noting that "the economic data have not seemed to support the kind of financial market movements we’ve seen to date." Importantly, Rosengren said that levels of corporate debt were a concern, including credit extended through non-bank lenders, and said that while fiscal policy is still providing stimulus to U.S. economy, in the long run fiscal deficits are unsustainable and this will have to reverse as debt level becomes unsustainable. Eventually... just not yet.
"I Can't Say I Know": Fed's Evans Surprised Market Is "Concerned" About Fed's Balance Sheet --Who would have possibly thought that after the Fed created the biggest asset bubble in history when it first, and then other central banks, purchased almost $10 trillion in assets over the past decade, ballooning the Fed's balance sheet from under $1 trillion to over $4 trillion, that the market could possibly be concerned about the reversal of this process? Not Chicago Fed president Charles Evans, that's for sure. Speaking to reporters after a speech in Milwaukee, Evans was discussing "concerns" in financial markets about the Fed's balance sheet winddown, and said what could be the most patently stupid line in Federal Reserve history: "This is interesting and perhaps I’ve been a little bit slower to appreciate the concerns that some expressed from the financial sector." Yes, one of most powerful people in the room just said he was "a little bit slower" to appreciate the market's concern that after the Fed quintupled its balance sheet, the reverse could be a "concern." But wait, it gets better, because his very next line was... well - here it is: "Apparently what financial institutions and commentators are pointing out is that there’s a different dimensionality to liquidity provision and how they go about doing a bunch of things that maybe the balance-sheet runoff is interfering with. I don’t know." Yup, he doesn't know... but "I think it’s noteworthy. I think it’s something that we need to pay attention to. Exactly what level concerns about how the economy is performing would have to rise to in order to make an adjustment, I can’t say I know, but I’m certainly more open-minded." Behind this barrage of hollow rhetoric was his admission that he is "certainly open-minded" about what level the S&P would have to fall to in order to "make an adjustment" in the Fed's balance sheet reduction. But wait, there's even more, because apparently while everyone at the Marriner Eccles building was focusing on interest rates, they forgot about the elephant in the room: the unwind of trillions and trillions in bond purchases, to wit: "I still think that changes in our policy interest rate instrument are going to be adequate for a while, but it’s something to think about."
Trump- Imagine If I Had Long Term ZERO Interest Rates To Play With - US stocks have climbed more than 8% since Treasury Secretary Steven Mnuchin rang up the PPT in the days before Christmas, but President Trump can't seem to move past the market turbulence that bled into the first trading days of 2019, despite the fact that stocks have climbed during four of the past five sessions.While economic data in Europe stoked fears of a recession in the Continent's largest economy, President Trump once again touted Friday's blockbuster jobs report, tweeting that "Economic numbers looking REALLY good. Can you imagine if I had long term ZERO interest rates to play with like the past administration, rather than the rapidly raised normalized rates we have today."To be sure, in addition to rock-bottom rates, the Obama Administration also had help from $3.8 trillion in QE. If that were the case, Trump argues, his job (which in his view apparently boils down to maintaining record-high equity prices) would be "SO EASY!". And although many analysts are still skeptical about whether we have already seen the bottom from the latest bout of market volatility, Trump took the opportunity to remind America that markets are up "BIG since 2016 Election!" Economic numbers looking REALLY good. Can you imagine if I had long term ZERO interest rates to play with like the past administration, rather than the rapidly raised normalized rates we have today. That would have been SO EASY! Still, markets up BIG since 2016 Election! — Donald J. Trump (@realDonaldTrump) January 8, 2019
Q4 GDP Forecasts: Mid-to-High 2s, Estimate of Shutdown Impact on GDP - Merrill Lynch estimate of impact of government shutdown on GDP: We think a deal to reopen the government will be reached eventually, but only after economic, financial and/or political pain is felt. Every two weeks of a shutdown will trim 0.1pp from growth; additional drag is likely due to delays in spending and investment. 4Q GDP tracking remains at 2.8%. We forecast 1Q GDP growth of 2.2%, but downside risks are emerging due to the government shutdown. [Jan 11 estimate] From the NY Fed Nowcasting Report The New York Fed Staff Nowcast stands at 2.5% for 2018:Q4 and 2.1% for 2019:Q1. [Jan 11 estimate] And from the Altanta Fed: GDPNow The current GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2018 remains 2.8 percent on January 10. [Jan 10 estimate] CR Note: These estimates suggest GDP in the mid-to-high 2s for Q4.
The recovery is alive and well. How much longer will it be? - WaPo - Markets think it’s the end of the recovery as we know it, but the economy feels fine. Better than fine, actually. After all, it just added a blockbuster 312,000 jobs in December, turns out to have added 58,000 more jobs than we had previously thought in the months before, and, thanks to six straight months of unemployment below 4 percent, is now seeing workers get their biggest raises, albeit not adjusted for inflation, since the recovery began almost 10 years ago. All of which is to say that the Federal Reserve is in a fairly awkward spot right now. How is that? Well, all of the backward-looking economic data says that we’re nowhere near a recession — not when we’ve added an average of 254,000 jobs a month in the past three months, compared with the 100,000 or so we’d need to keep the unemployment rate from going up — while most of the forward-looking financial indicators say that one might not be that far away. In other words, for every bit of good news about today, such as the continued growth in manufacturing employment, there’s a bit of bad news about the outlook for tomorrow, such as the big drop in manufacturing production. Which is why the Fed is justified in thinking that it’ll need to raise rates a few times this year to keep inflation in check at the same time that markets are, maybe not equally justified, but still on firm ground in thinking that it’s more likely that the Fed will end up cutting them. So what should the Fed do then? Well, in this case, the easy answer is the correct one. It should wait. That’s because we don’t know how much of today’s growth will go away tomorrow once the stimulative effect of Trump’s tax cuts fades away. Or how much of the slowdown in the rest of the world will put a speed limit on our own economy. Or whether higher wages will continue to suck more people into the workforce, as they did last month, or are instead a sign that companies are starting to run out of workers.
Odds of a US recession are ticking higher -- Chinese growth is slowing, the Federal Reserve is tightening monetary policy and US equities have seized up, losing over 13 per cent of their value since October. Add to that an unresolved trade war with China, and it's no surprise that recession warnings have reached a crescendo. While the IMF's David Lipton told the FT on the sidelines of the American Economic Association annual meeting in Atlanta over the weekend that he doesn't predict a recession this year or next, markets are saying something quite different.According to Nikolaos Panigirtzoglou at J.P. Morgan Securities, US equity markets are currently pricing in a 60 per cent chance of a US recession within one year. High-grade credit points to similar odds, as does US Treasuries and base metals. Investors in the one outlier, US high-yield credit, seem more sanguine. The asset class is pricing in a 12 per cent chance: In order to determine these probabilities, Panigirtzoglou and his team looked at the historical behaviour of different asset classes in the lead-up to US recessions in the past. What they find is that over the past 11 recessions, the S&P 500 declined an average 26 per cent. With the S&P 500 down some 16 per cent since its peak, there's that approximate 60 per cent chance within the year. (Because 16 is roughly 60 per cent of 26. So of course, this is rather rough measure; indeed not all economic downturns are preceded by stock market sell-offs at all.)As some recessions are shallower than others, Panigirtzoglou breaks down the historical data even further: deep versus mild. A deep recession is one in which the S&P 500 earnings fell by more than the median amount of bygone recessions -- typically this occurs when the S&P 500 drops 33 per cent. A mild one is the reverse and an average slide of 18 per cent. Given this, Panigirtzoglou calculates that if a recession comes, the chances of it being a mild one sit at 88 per cent.
JPMorgan Now Sees 60% Odds Of A Recession - None other than JPMorgan is now warning that - according to various markets - just two months after we reported that "JPMorgan Sees 60% Odds Of A Recession In 2 Years", the largest US bank now writes that "US equity, bond and commodity markets appear to be pricing in on average close to 60% chance of a US recession over the coming year." And it's not just one but two reports, the first from JPM economist Jesse Edgerton who writes that even after Friday's solid payrolls data, "our model estimates of the risk of recession have risen sharply over the past three months. Our preferred model based on economic data now puts the probability of recession beginning within 12 months at 39%, and models that incorporate signals from financial markets are [around 70%]." The bank then concedes that while it still thinks the most likely scenario involves continued moderate growth in 2019, i.e., the infamous "JPMorgan House View", it acknowledges that "risks of a downturn have increased." A second, more nuanced, report comes overnight from JPM strategist Nikolaos Panigirtzoglou, who is JPM's bearish yang to Kolanovic's bullish ying, and who tries to calculate "how much of a recession" markets are currently pricing in, adding that "to answer this question we look at the historical behavior of different asset classes around past US recessions, and in particular at the move from the pre-recession peak to the trough during the recession. To keep things simple, we assume that, at market peaks, no chance of a recession is priced in and by the time we reach the market bottom the recession is fully priced." With that in mind, and starting at the top, Nikolaos says that "equity markets appear to be pricing in around a 60% chance of a typical US recession." How does he get to this number? As the JPM strategist notes, the simplest way to assess how much of a US recession is priced in is to use the average 26% decline in the S&P500 index over the past 11 recessions. So far the S&P500 has declined by 16% from its peak, so equity markets price in a 16/26=62% chance of an average recession.
There’s heightened nervousness about the next recession and there are signs pointing in both directions. - Jared Bernstein - I can’t turn around without seeing or hearing people worrying more about the next recession. My peeps at the Indicator have a nice podcast on the topic. The WSJ points out that more than half of economists they surveyed expect a downturn by 2020, which, in case you live under a rock, the article helpfully notes is an election year.The reasons for the heightened anxiety are:
- –Slower global growth, particularly in China (also Europe and Japan). Remember how Apple’s market cap fell 10 percent in one day a couple of weeks ago. That was on the news that their China sales were down. We’re all connected, man…also, trade war.
- –Higher interest rates and the flat yield curve. Interest rates are up, which acts like a brake on growth and they’re up more for short- than long-term rates, meaning the yield curve is flat, though not inverted (inversions provide reliable recession warnings, though they don’t say precisely when).
- –High levels of US sovereign and corporate debt could provoke a credit crisis. High private sector debt levels can proceed a deep and sudden credit contraction, and high government debt can lead to the perception of diminished fiscal space, discussed below.
- –Overheating risk and the Fed. This has maybe faded in recent weeks as the Fed has sounded pretty dovish of late, while inflation–actual and expected–looks decidedly nonthreatening. But with historically low unemployment and bigger-than-expected job gains, there’s always some nervousness of the return of that 70s show, with inflation taking off and the Fed having to slam on the brakes.
- –Trumpian cray-cray. I mentioned the trade war. Then there’s the shutdown. And…how can I say this?…our current leadership fails to inspire confidence in this (or any other) space.
These are all real things, but here’s a realer thing: economists can’t tell you with any authority when the next recession is coming. If you forced me to take a stand, I’d stand with Powell. Heather Long reports the following: “I don’t see a recession” in 2019, Powell said Thursday in an interview at the Economic Club of Washington, D.C. “The U.S. economy is solid. It has good momentum coming into this year.”
Fitch Threatens To Cut US Credit Rating As Debt-Ceiling Battle Looms - In what has become a perennial exercise before every debt-ceiling showdown since at least Obama's first term (when S&P did the unthinkable and cut the US's coveted AAA credit rating, exposing itself to extensive abuse by Tim Geithner), ratings agencies are starting to beat the credit-rating downgrade drum, with Fitch getting a jump on the competition Wednesday when its head of sovereign ratings warned that an enduring shutdown battle could negatively impact the negotiations over the debt ceiling, which could prompt Fitch to join S&P in eliminating its AAA rating for the US. During an interview with CNBC and a separate appearance in London (where his comments were recorded by Reuters), Fitch’s global head of sovereign ratings James McCormack warned of a possible cut to its AAA rating for the U.S. sovereign should the shutdown continue to March, noting that the shutdown and debt ceiling battle are adding to anxieties triggered by President Trump's tax cuts and spending hikes, which have blown out the budget deficit and led to a "meaningful fiscal deterioration." "I think people are looking at the CBO (Congressional Budget Office) numbers. If people take the time to look at that you can see debt levels moving higher, you can see the interest burden in the U.S. government moving decidedly higher over the next decade," James McCormack, Fitch's global head of sovereign ratings told CNBC's "Squawk Box Europe" on Wednesday. "There needs to be some kind of fiscal adjustment to offset that or the deficit itself moves higher and you're essentially borrowing money to pay interest on the debt. So there is a meaningful fiscal deterioration there, going on the United States." Watch his interview with CNBC below:
U.S. Senate’s First Bill, in Midst of Shutdown, is a Bipartisan Defense of the Israeli Government from Boycott - When each new Congress is gaveled into session, the chambers attach symbolic importance to the first piece of legislation to be considered. For that reason, it bears the lofty designation of H.R.1 in the House, and S.1 in the Senate.In the newly controlled Democratic House, H.R.1 – meant to signal the new majority’s priorities – is an anti-corruption bill that combines election and campaign finance reform, strengthening of voting rights, and matching public funds for small-dollar candidates. In the new 2017 Senate, the GOP-controlled S.1 was a bill, called the “Tax Cuts and Jobs Act,” that, among other provisions, cut various forms of corporate taxes.But in the 2019 GOP-controlled Senate, the first bill to be considered – S.1 – is not designed to protect American workers, bolster U.S. companies, or address the various debates over border security and immigration. It’s not a bill to open the government. Instead, according to multiple sources involved in the legislative process, S.1 will be a compendium containing a handful of foreign-policy related measures, a main one of which is a provision, with Florida’s GOP Sen. Marco Rubio as a lead sponsor, to defend the Israeli government. The bill is a top legislative priority for AIPAC. In the previous Congress, that measure was known as S.170, and it gives state and local governments explicit legal authority to boycott any U.S. companies which themselves are participating in a boycott against Israel. As the Intercept reported last month, 26 states now have enacted some version of a law to punish or otherwise sanction entities which participate in or support the boycott of Israel, while similar laws are pending in at least 13 additional states. Rubio’s bill is designed to strengthen the legal basis to defend those Israel-protecting laws from constitutional challenge.
Anti-BDS Bill Slammed as ‘Absurd’ Amid US Government Shutdown Crisis — A US Senate measure encouraging states and local governments to “divest” from companies that boycott Israel has stirred controversy in Washington, with civil rights groups rallying against the proposal and Senator Bernie Sanders slamming it as “absurd”.The measure, presented in a wider Middle East foreign policy bill, was introduced last week amidst a partial shutdown of the federal government, which was caused by a political impasse over funding between Democrats and President Donald Trump’s Republican Party.“It’s absurd that the first bill during the shutdown is legislation which punishes Americans who exercise their constitutional right to engage in political activity,” Sanders wrote on Twitter on Monday.“Democrats must block consideration of any bills that don’t reopen the government. Let’s get our priorities right.” Newly elected Congresswoman Rashida Tlaib also criticised the proposal, which the Senate may vote on as early as Tuesday, urging politicians to remember that the US Constitution guarantees free speech.“They forgot what country they represent. This is the US. where boycotting is a right & part of our historical fight for freedom & equality,” she wrote on Twitter. “Maybe a refresher on our U.S.. Constitution is in order, then get back to opening up our government instead of taking our rights away.” The statement provoked Marco Rubio, the Republican senator who introduced the bill last week, to accuse the Palestinian-American congresswoman of anti-Semitism.
Shutdown enters third week as Trump reiterates demand for $5.7 billion in wall funding and White House reveals that Homeland Security is already working with the ARMY to build it - The White House continued to insist on a $5.7 billion price tag to end a partial government shutdown on Sunday, declaring for the first time that the U.S. Army will be the primary contractor building President Trump's border wall. The latest demand, which House Democrats have declared dead on arrival, came in a letter to key Democratic House committee chairs outlining Customs and Border Protection's readiness to break literal new ground with taxpayer dollars. 'In concert with the U.S. Army Corps of Engineers, CBP has increased its capacity to execute these funds,' said the letter from the White House budget office. 'The Administration's full request would fund construction of a total of approximately 234 miles of new physical barrier and fully fund the top 10 priorities in CBP's Border Security Improvement Plan.' Trump has argued that a wall between the U.S. and Mexico is needed to block drug cartels and human traffickers from flooding the United States with illegal immigrants and narcotics, and to block unnamed criminals from entering with caravans of Central Americans.'[A] physical barrier – wall – creates an enduring capability that helps field personnel stop, slow down and/or contain illegal entries,' according to the letter from Russell Vought, who became the budget office's acting director when Mick Mulvaney became acting chief of staff. A White House official said Monday morning that the letter's reference to the U.S. Army was 'no mistake.' 'It the president declares a national emergency, the Army Corps of Engineers will kick into high gear,' the official said. 'They're already handing out contracts, and that would speed up a lot.'
Shutdown Watch: Trump says shutdown could last ‘months or even years’ President Donald Trump said in a meeting with Republican and Democratic leadership Friday that he was prepared for the partial government shutdown to last “for a very long period of time, months or even years,” according to Senate Minority Leader Chuck Schumer. Trump told reporters in a Rose Garden press briefing later that day that he didn’t think the funding negotiations would last that long, but he was prepared for a prolonged partial government shutdown. “We won’t be opening until [the wall] is solved,” said Trump, adding that he thinks the shutdown will be over sooner than people think. “I’m very proud of doing what I’m doing.” But Schumer said that it was hard to see how progress could be made on border negotiations unless the government is funded. Trump also doubled down on his previous statements that a majority of federal workers that have been furloughed or forced to work without pay during the shutdown support his efforts to build a wall. “I think they’d say, ‘Mr. President keep going , this is far more important,'" Trump said.
White House asks Congress for $5.7 billion for ‘steel barrier’ The White House on Sunday officially asked Congress for $5.7 billion to build a “steel barrier,” confirming that President Donald Trump was backing down from his call for a concrete wall along the U.S.-Mexico border. The request, made against the backdrop of a partial government shutdown that has entered its third week, comes as Trump is also considering whether to go around Congress and declare a national emergency in order to construct his proposed wall. ..“A physical barrier — wall — creates an enduring capability that helps field personnel stop, slow down, and/or contain illegal entries,” Russ Vought, the acting director of the Office of Management and Budget, wrote in letters sent on Sunday to the House Appropriations Committee chairwoman, Rep. Nita Lowey (D-N.Y.), and its ranking member, Rep. Kay Granger (R-Texas). Just hours earlier, the president had again threatened to declare a national emergency as a means for construction, even while saying that he would first gauge the results of upcoming negotiations to end the shutdown, which was triggered by partisan debate over his signature campaign promise. “I may decide a national emergency depending on what happens over the next few days,” Trump told reporters as he exited the White House en route to Camp David, according to a pool report. “We have to build the wall or we have to build the barrier. The barrier or the wall can be of steel instead of concrete if that works better,” the president said.
What Trump Could Do If He Declares a State of Emergency - Trump has long signaled his disdain for the concepts of limited presidential power and democratic rule. During his 2016 campaign, he praised murderous dictators. He declared that his opponent, Hillary Clinton, would be in jail if he were president, goading crowds into frenzied chants of “Lock her up.” He hinted that he might not accept an electoral loss. As democracies around the world slide into autocracy, and nationalism and antidemocratic sentiment are on vivid display among segments of the American populace, Trump’s evident hostility to key elements of liberal democracy cannot be dismissed as mere bluster. The moment the president declares a “national emergency”—a decision that is entirely within his discretion—he is able to set aside many of the legal limits on his authority.It would be nice to think that America is protected from the worst excesses of Trump’s impulses by its democratic laws and institutions. But will they? Unknown to most Americans, a parallel legal regime allows the president to sidestep many of the constraints that normally apply. The moment the president declares a “national emergency”—a decision that is entirely within his discretion—more than 100 special provisions become available to him. While many of these tee up reasonable responses to genuine emergencies, some appear dangerously suited to a leader bent on amassing or retaining power. For instance, the president can, with the flick of his pen, activate laws allowing him to shut down many kinds of electronic communications inside the United States or freeze Americans’ bank accounts. Other powers are available even without a declaration of emergency, including laws that allow the president to deploy troops inside the country to subdue domestic unrest. This edifice of extraordinary powers has historically rested on the assumption that the president will act in the country’s best interest when using them. With a handful of noteworthy exceptions, this assumption has held up. But what if a president, backed into a corner and facing electoral defeat or impeachment, were to declare an emergency for the sake of holding on to power? In that scenario, our laws and institutions might not save us from a presidential power grab. They might be what takes us down.
Key Democrat Admits Trump Has Authority To Declare National Emergency To Build Wall - Democratic Rep. Adam Smith (D-WA), chair of the House Armed Services Committee, admitted that President Trump has the authority to declare a national emergency and have the military build a wall along the US-Mexico border. ABC's "This Week" host George Stephanopoulos asked Smith "Does President Trump have the ability, have the authority to declare a national emergency and have the military build his wall?" "Well, unfortunately, the short answer is yes," replied Smith. "There is a provision in the law that says the president can declare an emergency. It’s been done a number of times, but primarily it’s been done to build facilities in Afghanistan and Iraq. In this case, I think the president would be wide open to a court challenge saying, where is the emergency? You have to establish that in order to do this. Beyond that, this would be a terrible use of Department of Defense dollars." "The president spends most of his time talking about how we’re not spending enough on national security, now he wants to take $20 billion out of defense budget to build a wall. Which by the way, is not going to improve our border security. The president seems unaware of this, but we have actually already built a wall across much of the border, and all border security experts that I talk to say, where a wall makes sense, it’s already been built. We should have a conversation about border security, but first, we should we open the government and pay our border patrol agents and the federal agents that are furloughed," Smith added. Watch:
With no deal in sight, shutdown reveals depth of ‘trust deficit’ - With the partial government shutdown at Day 17 and counting, Congress and the White House are at an impasse. President Trump refuses to put his name on any spending bill that doesn’t have $5.7 billion for his border wall. Democrats won’t support any funding for the wall – and their new House majority gives them the leverage to hold out. Hanging like a cloud over the negotiations is the question of trust. The political center in Washington has narrowed, leaders have bowed to their bases, and the idea of giving the other side what it wants has taken on the stink of surrender. Compounding it is Mr. Trump’s unpredictability. Lawmakers from both parties have grown leery of his habit of shifting his demands – and it’s much harder for them to go out on a political limb when they don’t know whether the president will be with them. “There’ll be less risk taken by both sides under conditions of mistrust,” says Frances Lee, a professor of government at the University of Maryland. “Any concessions Democrats make are likely to be denounced by their base of voters, and the same is true for Trump.”
House GOP leaders fear support eroding for Trump’s shutdown fight - Several dozen House Republicans might cross the aisle this week to vote for Democratic bills to reopen shuttered parts of the federal government, spurring the White House into a dramatic effort to stem potential GOP defections. White House officials and Republican congressional leaders worry that GOP support for the shutdown is eroding, weakening President Donald Trump’s hand as he seeks billions of dollars for a border wall that Democrats have vowed to oppose, according to GOP lawmakers and aides. .Hoping to sway skeptics in his party and the broader public, Trump will make an Oval Office address Tuesday night to discuss what he called the “Humanitarian and National Security Crisis on our Southern Border," he said on Twitter. Then he will visit the border region on Thursday. Vice President Mike Pence and Homeland Security Secretary Kirstjen Nielsen will address House Republicans on Tuesday evening. The House is scheduled to vote Wednesday on a Democratic bill designed to fund the IRS and several other agencies, the first of four bills Democrats hope will peel off Trump's GOP support in the House. Without more money, the IRS could have a problem processing tax refunds. Russ Vought, acting director of the Office of Management and Budget, reversed course Monday and said refunds will be paid out, another move by the White House to mitigate the effects of the shutdown. The Democratic funding measure is one of several narrow measures that Speaker Nancy Pelosi (D-Calif.) and party leaders will push forward this week. The bills are designed to put pressure on GOP lawmakers to break with Trump and support re-opening the nine departments hit by the 17-day shutdown. More than 800,000 federal workers are currently not getting paid — roughly 350,000 remain on the job without pay — with their first missed paycheck coming later this week.
Pelosi and Schumer issue extraordinary statement saying they expect Trump’s Oval Office address to the nation to be ‘full of malice and misinformation’ and DEMAND networks give Dems equal airtime after deciding to broadcast his shutdown message - House Speaker Nancy Pelosi and top Senate Democrat Chuck Schumer called on the American television broadcast networks to give Democrats a chance to respond to President Donald Trump when he addresses the nation on Tuesday night over the federal government shutdown. 'Now that the television networks have decided to air the President's address, which if his past statements are any indication will be full of malice and misinformation, Democrats must immediately be given equal airtime,' they wrote in a joint statement released Monday night. With no breakthrough in sight, Trump will argue his case to the nation Tuesday night that a 'crisis' at the U.S.-Mexico border requires the long and invulnerable wall he's demanding before ending the partial government shutdown. Hundreds of thousands of federal workers face missed paychecks Friday as the shutdown drags through a third week. 'There is a humanitarian and national security crisis,' Vice President Mike Pence told reporters Monday as it's feared Trump will declare a national emergency that would empower him to construct the $5.6billion border wall without congressional approval. Pence said the White House counsel's office is looking at the idea.
Trump Declares Border ‘Crisis’ Without New Plan to End Impasse - President Donald Trump demanded Congress provide billions more to combat illegal migration in a prime-time address, stopping short of declaring a national emergency and offering no new path to end a paralyzing political dispute over his proposed wall on the Mexican border. “The only solution is for Democrats to pass a spending bill that defends our borders and reopens our government,” Trump said Tuesday during a roughly 10-minute televised speech from the Oval Office, employing for the first time in his presidency a format traditionally used to explain major military actions or to calm the nation during times of crisis.The address, aired on all major U.S. television networks, was the latest step in Trump’s campaign to tackle what he called a crisis at the U.S.-Mexico border. He is pushing to show supporters he’s fighting for a key promise of his 2016 campaign, and by appealing directly to Americans, he hoped to raise public pressure on Democrats to agree to some additional funding for border security. “This is a humanitarian crisis,” Trump said. “A crisis of the heart and a crisis of the soul.” House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer rejected Trump’s description of a crisis on the Mexican border in their televised response to the president’s address. “President Trump must stop holding the American people hostage, must stop manufacturing a crisis, and must reopen the government,” Pelosi said. Standing next to Pelosi, Schumer said only Trump should be blamed for the shutdown.
Trump opts against declaring national border emergency — for now - President Donald Trump opted against using his first Oval Office prime-time address to declare a national emergency at the southern border, instead labeling the situation a “crisis” in an attempt to get Democrats to grant his demand for a wall and end the partial government shutdown. The president delivered his plea to lawmakers to pass legislation to address the U.S.-Mexico border by repeating his hard-line rhetoric that the area is a transit route for hordes of migrants making illegal crossings, dangerous criminals, lethal narcotics and human traffickers. But he did not appear to dangle any olive branches toward Democrats or say anything that might attract enough Democratic votes to pass a bill with $5.7 billion for the barrier and end the shutdown. Trump, seated behind the Resolute Desk, told Americans he was addressing them because of a “growing humanitarian and security crisis at our southern border,” saying “thousands of illegal immigrants” enter the country each year. He called illegal immigration a “tremendous problem,” saying high levels of “meth, heroin, cocaine and fentanyl” are being moved into the United States across the southern border. “Thousands” of Americans, he contended, have been killed by illegal migrants and “thousands more will be lost if we don’t act right now,” Trump said, calling the situation a “crisis of the heart and a crisis of the soul.” The president touted a plan to fund his border wall and also finance other border security and migrant-detention needs his team and senior congressional aides agreed to over the weekend. He called it a commonsense approach, but it still lacks any Democratic lawmaker support. “Democrats in Congress have refused to acknowledge the crisis,” the president said. “The federal government remains shut down for one reason, and one reason only: Because Democrats will not fund border security.”
Full Text: Trump’s Prime-Time Address on Shutdown, Border Wall - Below is the White House transcript of President Donald Trump’s address to the nation on the border and partial government shutdown, which aired live from the Oval Office. The White House clocked it at 10 minutes, 9:01 p.m. to 9:11 p.m.
Democrats Say Trump Is Using U.S. Workers as Leverage for Wall Money - The top two Democrats in Congress accused President Donald Trump of harming U.S. government employees and withholding critical services to force Congress to fund his proposed border wall. The comments from House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer were delivered Tuesday night after Trump gave a prime-time address from the Oval Office in which he warned of crime and drugs coming across the U.S.-Mexico border. Pelosi of California said Trump is rejecting House-passed legislation reopening shuttered government agencies to fulfill his campaign promise to build a wall. He is doing that, she said, “over his obsession with forcing American taxpayers to waste billions of dollars on an expensive and ineffective wall -- a wall he always promised Mexico would pay for.” “We don’t govern by temper tantrum,” Schumer of New York said moments later. “No president should pound the table and demand he gets his way or else the government shuts down, hurting millions of Americans who are treated as leverage.” Trump is demanding $5.7 billion for the wall, an idea Democrats reject as costly and ineffective in protecting U.S. security. The shutdown, which began Dec. 22, affects nine of 15 departments, representing about a quarter of the $1.24 trillion in government discretionary spending for fiscal year 2019. About 800,000 employees are either furloughed or working without pay. On Wednesday, Trump will meet with congressional leaders from both parties at the White House, and he’ll attend a luncheon meeting of Senate Republicans in the Capitol. Trump also will travel to the U.S.-Mexico border on Thursday, a trip that hints at protracted negotiations over his key campaign promise. The House has passed legislation to reopen the government while negotiations over a border wall continue. But Trump opposes it, and Senate Majority Leader Mitch McConnell -- who had publicly cautioned the president against a shutdown strategy -- says he won’t take up any measure that Trump won’t sign. UP NEXT
Full Text: Pelosi, Schumer Respond to Trump’s Prime-Time Border Address -- Below is the prepared text for House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer, as they together spoke in joint response to President Donald Trump’s address about border security and the ongoing partial government shutdown. The pair generally stuck to their prepared remarks.
Trump’s immigration speech won’t get him his wall, but it was still scarily effective. - President Donald Trump’s address to the nation on Tuesday night was unimaginative, lacking in energy, and filled with his habitual lies and misrepresentations. It was also worryingly effective.Making his case for a border wall over the course of nine short minutes, Trump cited horrible crimes to instill fear in the hearts of millions of viewers. He claimed to speak for all Americans, arguing that insufficient border security was a particular threat to Latinos, black Americans, and even those trying to reach America. Most importantly, he actually defended the morality of his proposed actions: Making a not-so-veiled reference to Barack Obama, he claimed that “rich politicians” build high walls around their homes not because they hate those who are on the outside but rather because they love those who are on the inside. We’ve become so accustomed to seeing Trump rail without discipline or coherence that it is easy to forget how powerful this basic message is: In his speech, Trump proposed immoral policies while claiming the high ground for himself and made a case that was designed to give the impression that he actually cares about the future of America (as opposed to that of his own family). If Trump had used the vast bully pulpit he has enjoyed for the past four years to paint his political vision in this carefully chosen light—rather than, say, discussing affairs with porn stars, engaging in astonishingly open racism, and making everything about himself—he would likely have had much greater success in reshaping America in his own image.
Reality check- More terror suspects have entered the U.S. from Canada than from Mexico - President Donald Trump and his officials persist in promoting the discredited notion that suspected terrorists are pouring into the U.S. from Mexico by the thousands. Despite their portrayal of Mexico as a teeming portal for terrorists, the State Department issued a report in September finding “no credible evidence indicating that international terrorist groups have established bases in Mexico, worked with Mexican drug cartels or sent operatives via Mexico into the United States.” It went on : “The U.S. southern border remains vulnerable to potential terrorist transit, although terrorist groups likely seek other means of trying to enter the United States.” Trump and others are insistent on sticking to their case regardless as they press Congress for money to build a border wall, the dispute that has closed parts of the government. The latest iterations of their statements: TRUMP: “We have terrorists coming through the southern border because they find that’s probably the easiest place to come through. They drive right in and they make a left.” — Rose Garden news conference Friday. If they’re driving in through border crossings, no wall would stop them. But as to his broader point, U.S. officials have not cited evidence of a terrorist influx from Mexico. State Department reports on terrorism have expressed more concern about Canada, which unlike Mexico has been home to “violent extremists inspired by terrorist groups such as ISIS and al-Qaida and their affiliates and adherents,” as it said in 2017. When it comes to land crossings, Canada has more often been the source of terrorism suspects entering the U.S., though not in great numbers. By far the majority of people who arouse concern try to enter by air.
Pelosi Slams Trump After Threat To Pull California FEMA Funds - President Trump on Wednesday announced over Twitter that he has ordered the Federal Emergency Management Agency (FEMA) to top sending money to California "unless they get their act together, which is unlikely." "Billions of dollars are sent to the State of California for Forrest fires that, with proper Forrest Management, would never happen," Trump tweeted just one day after California Governor Gavin Newsom was sworn in, adding "It is a disgraceful situation in lives & money!" In November, Trump threatened to cut wildfire funding as California burned from two out-of-control blazes, tweeting "There is no reason for these massive, deadly and costly forest fires in California except that forest management is so poor. Billions of dollars are given each year, with so many lives lost, all because of gross mismanagement of the forests. Remedy now, or no more Fed payments!" California Rep. Nancy Pelosi (D) said that Trump's threat to pull FEMA funding for California "insults the memory of those who died" in the 2018 wildfires. A total of 98 civilians and six firefighters were killed during the 8,527 fires which raged throughout California last year, burning a cumulative 1,893,913 acres - the largest amount of burned acreage recorded in a fire season according to the California Department of Forestry and Fire Protection (CalFire).
Trump Still Holding Open Possibility of Emergency Declaration, White House Says - President Donald Trump’s administration is still considering declaring a national emergency on the U.S.-Mexico border as a government shutdown over his proposed wall stretches on, White House Press Secretary Sarah Huckabee Sanders said. “It’s something we’re still looking at,” Sanders told reporters Wednesday morning. “The best solution is to be able to work with Congress to get this done. We can close a lot of the loopholes, fund border security fully and that’s what we’re hopeful to do.” Sanders also told Fox News on Wednesday that declaring the emergency was “certainly still an option.” Trump, in a prime-time address from the Oval Office on Tuesday night, reiterated his claims that people and drugs entering the country illegally across its southern border are responsible for committing crimes and that a wall would help thwart them. In a Democratic rebuttal, House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer demanded the president first end the shutdown, then discuss border security. None offered new options to end the impasse. With little hope of a breakthrough in negotiations -- and the shutdown now in it’s 19th day -- Fitch Ratings Ltd. warned Wednesday of a possible cut to the U.S. triple-A sovereign credit rating later this year, according to Reuters.
GOP senators challenge Trump on shutdown strategy -Several Senate Republicans on Wednesday challenged President Trump on his strategy for ending a 19-day shutdown during a closed-door meeting where they expressed specific concerns over the harm it is causing to federal workers and the economy. Sen. Susan Collins (R-Maine), who faces a tough reelection in a state Democratic presidential nominee Hillary Clinton won in 2016, said she asked Trump to consider a bipartisan compromise that would give certain immigrants, known as Dreamers, a path to citizenship in exchange for border security money. “I suggested that we take a look at the package that we put together last February and brought to the floor as a possible compromise,” Collins said, recounting her conversation with Trump during a closed-door lunch meeting in the Capitol. Sen. Lisa Murkowski (R-Alaska) warned the president that the shutdown is having an impact on industries in her state that depend on federal regulation, such as fishing. “When government is shut down, there are consequences and people are starting to feel those consequences,” Murkowski said, recalling her exchange with the president. “I addressed the things that are very local to us. It’s not just those who don’t receive a federal paycheck on Friday, but there are other consequences for those of us who utilize [federal] services whether it’s those who are seeking to get a fish scale certified so you can deliver product,” she added. Collins and Murkowski have bucked Trump and their party before, but the president also heard worries from other voices. Sen. James Lankford (R-Okla.), a leading moral voice in the conference, spoke of the hardships faced by federal workers, according to a Republican source familiar with the meeting. Lankford’s decision to speak up behind closed doors to remind the president about the human impact of the shutdown is notable because he has supported Trump’s position publicly.
Think Trump can’t use emergency powers to build the border wall? Here’s why he could - President Donald Trump intensified threats Thursday to invoke his “emergency powers” to build his border wall if Democrats don’t cooperate, saying his lawyers have looked into the matter and “they tell me 100 percent” he can. Critics have denounced the idea as abusive and unlawful, but experts on presidential powers and immigration enforcement say that Congress has granted Trump, and presidents before him, wide latitude to invoke emergency powers. He also has a sympathetic Supreme Court that has demonstrated willingness to back him in the event of a court challenge. “Congress has left very broad powers in the hands of whoever is president to declare emergencies for reasons vague, imagined or real,” said Michael Waldman, president at the Brennan Center for Justice. “And presidents have a lot of power when they do that.” The Brennan Center for Justice has identified 136 statutory powers that a president can invoke just by signing his name. Trump first raised the prospects of using his emergency powers on Friday during a news conference in the Rose Garden. The new Democratic chairman of the House Armed Services Committee, Rep. Adam Smith of Washington, later appeared to agree with him, but warned he’d be “wide open to a court challenge.” “Unfortunately, the short answer is yes,” Smith said during an interview on ABC’s “This Week.” Read more here: https://www.mcclatchydc.com/news/politics-government/white-house/article224112550.html#storylink=cpy
Trump says emergency declaration coming without border deal with Dems - President Trump on Wednesday said he may declare a national emergency to circumvent Congress and build a border wall if spending talks fail, raising the stakes for negotiations set to resume later in the day. “I think we might work a deal, and if we don’t we might go that route,” Trump told reporters during a bill signing in the Oval Office. The president said he has the “absolute right” to declare an emergency, even though some legal scholars and Democratic lawmakers say he does not. Trump added that his “threshold” for declaring a national emergency is if he cannot reach a deal with congressional Democrats, who have rejected his demand for $5.7 billion for a wall along the U.S.-Mexico border. The comments come one day after he argued to the nation in a televised addressed that a “humanitarian crisis” caused by drug trafficking and illegal immigration exists on the southern border and his proposed wall is the only thing that can stop it. The president stopped short of declaring a national emergency, despite the expectation from some lawmakers that he would. But the White House on Wednesday reiterated that the option is still on the table. Trump’s words did not move Democratic leaders who have repeated their demands that the president reopen the government before negotiations on border security can progress. “It’s much harder to achieve a good negotiation while the government’s shut down,” Senate Minority Leader Charles Schumer (D-N.Y.) said at the Capitol. “The first order of business — we’ll continue to negotiate — the first order of business: Open up the government.”
Rubio warns Trump a border emergency could embolden a future Dem president on climate change - A national emergency declaration by President Donald Trump over border security could wind up hurting Republicans, GOP Sen. Marco Rubio told CNBC on Wednesday. The Florida Republican contended that Trump was elected on the promise of building a wall along the U.S.-Mexico border and the president has to "keep that promise." But "we have to be careful about endorsing broad uses of executive power," he added. "I'm not prepared to endorse that right now." Such a declaration would set a precedent, Rubio said. "If today, the national emergency is border security ... tomorrow the national emergency might be climate change." Declaring a national emergency, which would certainly face legal hurdles, could give Trump the ability to use the military to build the wall instead of getting Congress to approve the funding for it. Rubio joined "Squawk Box" as the partial government shutdown entered its 19th day due to the stalemate between Trump and Democrats on funding for a border wall. In a prime-time TV address Tuesday night, Trump made his case for a wall, highlighting multiple grisly examples of Americans allegedly murdered by undocumented immigrants. Rubio said he would have liked the president to clarify during his address that the request for $5.7 billion in border security funding is not for a wall or a loan. "It's $5 billion to fund the top 10 projects on a border security program by the experts and the people in charge of doing that," Rubio said. Asked whether he supports Trump's position, which includes the wall, Rubio said, "Anything that makes the border more secure, I'll be in favor of supporting."
Trump storms out of meeting as shutdown careens toward fourth week -- President Trump abruptly left a White House negotiating session with congressional Democrats about 20 minutes into the meeting, dismissing it as a “total waste of time” as the partial government shutdown careened toward a fourth week. The acrimonious collapse of the talks left no clear solution for ending the impasse, which has consumed Washington and raised concerns about pain for hundreds of thousands of federal workers across the country. Top Democrats said they once again urged Trump to reopen shuttered government agencies during the abbreviated meeting. Trump refused and instead asked Speaker Nancy Pelosi (D-Calif.) if she would approve border wall funding within 30 days if he opened the government. When she said “no,” the president got up and left, according to officials in the room. “Again, we saw a temper tantrum because he couldn't get his way and he just walked out of the meeting,” Senate Minority Leader Charles Schumer (D-N.Y.) told reporters on the West Wing driveway. Trump confirmed in a tweet posted as Democratic leaders were speaking that he did walk out of the meeting, saying that “Nancy said, NO. I said bye-bye, nothing else works!” The president did indeed use the words “bye-bye” as he left the room, according to a source familiar with the meeting. Amid falling show and chilling temperatures, Republican and Democratic leaders alike stood outside the White House to accuse one another of misrepresenting what had happened. Schumer said Trump “slammed the table” as he left the meeting, while Vice President Pence said the president had “passed out candy” — a mix that included Butterfingers and M&Ms — and that he had not raised his voice or slammed his hand.
Trump pledges not to cave on border wall as he heads to Texas amid government shutdown - President Donald Trump promised to hold firm to his border wall pledge Thursday morning ahead of a trip to a Texas town near the boundary between the U.S. and Mexico. As a partial government shutdown entered its 20th day, the president showed no signs of relenting on his demand to for more than $5 billion to build a portion of a barrier on the border. In a string of tweets in part responding to a morning television host, Trump said "I won't" cave on the wall demand. The message comes as talks to reopen nine federal departments crumbled Wednesday afternoon. Trump walked out of a meeting with House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer after the top U.S. representative rejected his request for border wall money. The breakdown has massive stakes for the hundreds of thousands of federal workers who will start to miss paychecks Friday if lawmakers fail to fund the government. Trump will travel to McAllen, Texas on Thursday morning to draw attention to what he claims is a "humanitarian crisis" at the southern U.S. border. The president has used horrific tales of murder and drug abuse to make his case for a wall — prompting Democrats to accuse him of fear mongering for political purposes. Trump has teased the possibility of declaring a national emergency to build the border barrier without congressional approval. On Thursday, he argued he has an "absolute right" to do so, but the move would likely face a swift challenge in the courts. He could potentially use the journey to McAllen, a busy border area, as part of his justification for the action. "If [a deal with Congress] doesn't work out, probably I will do it. I would almost say definitely," Trump said of declaring a national emergency as he left the White House for Texas.
'We're all behind the president': Shutdown could drag on as Senate GOP digs in on Trump border wall - President Donald Trump said Wednesday that Republicans "are totally unified" behind his border wall fight — suggesting a partial government shutdown could drag on for a while.The president met with the Senate GOP caucus on the 19th day of the closure as a few senators have started to break with their party in Trump's immigration battle. Trump and senators emerged preaching consensus, which does not bode well for the shutdown ending anytime soon as Democrats hold firm on their pledge not to fund the proposed barrier."We're all behind the president. We think this border security issue is extremely important to the country," Senate Majority Leader Mitch McConnell told reporters after the meeting.Sen. Tim Scott, R-S.C., suggested the shutdown will "drag on," according to Bloomberg. Trump has pushed for more than $5 billion to build the wall, and Democrats have refused to approve the money.No deal to reopen nine federal departments appeared to take shape as 800,000 federal workers face missing paychecks starting Friday. As the stalemate continues, Trump is set to meet with bipartisan congressional leaders including House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer. The Democratic-held House has passed legislation to fund the government without money for the proposed wall. McConnell has said the Republican-controlled Senate will not take up the measures because Trump opposes them.
With Crumbling Bridges and Roads, the Nation is Excited to Build a Giant Wall -- As America’s bridges, roads, and other infrastructure dangerously deteriorate from decades of neglect, there is a mounting sense of urgency that it is time to build a giant wall. Across the U.S., whose rail system is a rickety antique plagued by deadly accidents, Americans are increasingly recognizing that building a wall with Mexico, and possibly another one with Canada, should be the country’s top priority. Harland Dorrinson, the executive director of a Washington-based think tank called the Center for Responsible Immigration, believes that most Americans favor the building of border walls over extravagant pet projects like structurally sound freeway overpasses. “The estimated cost of a border wall with Mexico is five billion dollars,” he said. “We could easily blow the same amount of money on infrastructure repairs and have nothing to show for it but functioning highways.” Congress has dragged its feet on infrastructure spending in recent years, but Dorrinson senses growing support in Washington for building a giant border wall. “Even if for some reason we don’t get the Mexicans to pay for it, five billion is a steal,” he said. While some think that America’s declining infrastructure is a national-security threat, Dorrinson strongly disagrees. “If immigrants somehow get over the wall, the condition of our bridges and roads will keep them from getting very far,” he said.
Shutdown showdown: Democrats press to reopen government as Trump heads to border -Democrats sought unsuccessfully Thursday to pass bills to reopen shuttered government agencies as President Trump headed to the U.S.-Mexico border in a bid to gain leverage in a stalemate over funding his long-promised border wall. With a partial government shutdown now nearly three weeks old, Trump has an afternoon event planned at a Border Patrol station in McAllen, Tex., and will then head to the Rio Grande for a briefing, according to guidance provided by the White House. Before leaving the White House, Trump said if he can’t cut a deal with Congress, he “probably” will declare a national emergency and direct the military to build a wall without congressional consent.Trump said Thursday that he is scrapping his plans to attend the World Economic Forum in Davos, Switzerland, later this month because of the partial government shutdown.He made the announcement via Twitter as Air Force Once was still en route to Texas. “Because of the Democrats intransigence on Border Security and the great importance of Safety for our Nation, I am respectfully cancelling my very important trip to Davos, Switzerland for the World Economic Forum,” Trump wrote. “My warmest regards and apologies to the @WEF!”
The government shutdown is tied for the longest ever as Trump's border wall fight rages on - The partial U.S. government shutdown entered its 21st day Friday, tying the record for longest lapse in federal funding.The dubious distinction comes on the same day hundreds of thousands of U.S. workers start to miss paychecks. About 800,000 federal employees are either furloughed or temporarily working without pay as the closure persists. Lawmakers have failed to fund nine departments, or about a quarter of the government, as President Donald Trump demands more than $5 billion to fund his proposed border wall. The president has threatened to veto legislation passed by the Democratic-held House to reopen the government temporarily, which has deterred the GOP-controlled Senate from passing it.The funding lapse also has an economic cost. The lack of worker paychecks and the shutdown's potential effects on tax refunds, mortgage applications, food assistance programs and consumer sentiment could hit the U.S. economy to the tune of at least $2 billion a week, according to an estimate by Wells Fargo retail analysts. Meanwhile, S&P Global gave a "conservative" estimate that the closure had an economic effect of about $3.6 billion through Friday. The financial services company expects the shutdown to trim about 0.05 percent, or $1.2 billion, off quarterly GDP growth for each week that it goes on."If the partial government shutdown continues for two more weeks, our estimate of the total impact will be $6.0 billion, which would exceed the $5.7 billion in funding being requested to build a border wall," wrote Beth Ann Bovino, the U.S. chief economist for S&P Global Ratings. The longest previous shutdown lasted three weeks during December 1995 and January 1996. It followed a budget spat between President Bill Clinton and House Speaker Newt Gingrich.
If the shutdown lasts two more weeks, the cost to the economy will exceed price of Trump's wall - If the government shutdown lasts another two weeks, the total cost to the U.S. economy would exceed the price of building the proposed border wall. According to an estimate by S&P Global, it will only take another two weeks to cost the economy more than $6 billion, exceeding the $5.7 billion that President Donald Trump demanded to fund his proposed border wall. The U.S. economy will have lost $3.6 billion by Friday, according to S&P. "We estimated that this shutdown could shave approximately $1.2 billion off real GDP in the quarter for each week that part of the government is closed. That may seem like pennies for the world's biggest economy, but it means a lot to those workers trying to cover their household costs without their paychecks," Beth Ann Bovino, S&P's chief U.S. economist said in a note on Friday. The firm came up with these figures by looking at costs related to the shutdown including lost productivity by furloughed workers and a decrease in sales for contractors to the government. The partial government shutdown entered its 21st day Friday, tying the record for longest lapse in federal funding. Lawmakers have failed to fund about a quarter of the government, as President Donald Trump demands money for his proposed border wall. The president has threatened to veto legislation passed by the Democrat-controlled House to reopen the government temporarily, and that has deterred the GOP-controlled Senate from passing it. With 800,000 federal workers not being paid and a potential delay in tax refunds, the economic effect of the partial government shutdown could be at least $2 billion per week, according to Wells Fargo retail analysts.
Graham Calls On Trump To Use Emergency Powers To Build Wall - Sen. Lindsey Graham on Thursday called on President Trump to declare a national emergency in order to fund the construction of the US-Mexico border wall, after the latest round of negotiations in the Senate fell apart. "Speaker Pelosi's refusal to negotiate on funding for a border wall/barrier -- even if the government were to be reopened -- virtually ends the congressional path to funding for a border wall/barrier," said Graham in a statement. "It's time for President Trump to use emergency powers to fund the construction of a border wall/barrier." "I hope it works" The statement follows failed negotiations led by Graham involving moderate GOP senators, some of whom blamed both President Trump and House Speaker Nancy Pelosi (D-CA) for being unwilling to compromise with each other.
'It's a bad precedent' — GOP Sen. Grassley warns Trump not to declare an emergency over the wall - President Donald Trump should not declare a national emergency over illegal immigration in order to bypass Congress to get his long-promised wall along the U.S.-Mexico border, Sen. Chuck Grassley, a veteran Republican from Iowa, told CNBC on Friday. Declaring a national emergency could give the president the ability to use the military to build the wall instead of getting Congress to approve funding for it. Trump wants about $5.7 billion for border security, including about 234 miles of new barriers. Democrats, who now control the House, have refused to allocate any money that goes to the building of any more walls or fences along the U.S. southern border. Grassley said in a "Squawk Box" interview that "I believe you're going to find it in the courts almost immediately. And the courts are going to make a decision" if Trump declares an emergency. Grassley said the quicker the Supreme Court could make a decision on the matter should it come to pass the better. "The president is threatening emergency action, a national emergency declaration. I don't think he should do that. I think it's a bad precedent. And it contravenes the power of the purse that comes from the elected representatives of the people," said Grassley, who was elected to Congress in 1974 and the Senate in 1980. On Wednesday, Trump said he will "probably" declare a national emergency if a wall deal can't be worked out. Sen. Marco Rubio, who unsuccessfully sought the 2016 GOP presidential nomination said Wednesday on CNBC that a national emergency declaration by Trump could create a slippery slope. "If today, the national emergency is border security ... tomorrow the national emergency might be climate change," said the Florida lawmaker, referring to climate change as an issue that's near and dear to Democrats and anathema to Republicans. Both Trump and Democrats have been digging in on their wall positions, leading to a partial government shutdown, now in Day 21. On Friday, the shutdown tied the 1995-96 closure during the Clinton administration as the longest ever. Also Friday, more than 800,000 federal workers were starting to miss paychecks.
Trump Could Use Money Earmarked For Puerto Rico To Build The Wall- Reports - Shortly after President Trump finished a briefing with national security officials near the US-Mexico border in McAllen Texas, NBC News published what it purports to be details from an earlier briefing on Thursday with senior defense officials aboard Air Force One.Though the officials weren't named, NBC reported that they walked Trump through the details which included of a plan whereby the Army Corp of Engineers would use money earmarked for disaster-recovery projects - like aide to storm-damaged areas of Puerto Rico - and instead use it to begin construction on the wall. The report suggests that a plan is being finalized and that the president might soon defy his critics and declare a national emergency to start construction on the wall - (a step that would go a long way toward ending the shutdown). In a report that's sure to incense Trump's political opponents - who have complained that the wall would ultimately be a waste of money that would be better spent on other infrastructure projects or, better yet, medicare for all - $13.9 billion of Army Corps funding would be used to build 315 miles of barrier along the US-Mexico border, far more than what would be accomplished by the $5.7 billion Trump is seeking from Congress (that money would only apply to a wall stretching for 234 miles).What's more, much of the money to finance the plan would be taken from projects earmarked for California, including flood prevention projects near the Yuba River Basin.Under the proposal, the officials said, Trump could dip into the $2.4 billion allocated to projects in California, including flood prevention and protection projects along the Yuba River Basin and the Folsom Dam, as well as the $2.5 billion set aside for reconstruction projects in Puerto Rico, which is still recovering from Hurricane Maria.Completing this segment of the border wall would take about 18 months, and cover an area from Texas to California. Trump was informed that the Army Corps could build 315 miles of border wall in about 18 months, according to officials familiar with the planning. The barrier would be a 30-foot bollard-style wall with a feature designed to prevent climbing, the officials said.
U.S. Military Readies to Pay for Trump's Border Wall - If U.S. President Donald Trump declares a national emergency as a way to divert military funding to pay for his long-promised border wall without lawmakers’ consent, the Pentagon will be prepared with roughly $3 billion in ready funds, a U.S. defense official told Foreign Policy Thursday. The Department of Defense has $2 billion to $3 billion in unobligated military construction funds—money that has been appropriated by Congress but not yet issued for specific projects—that the president could legally redirect to a wall at the southern U.S. border in a national emergency, the official said. The Pentagon is preemptively looking through those accounts for funding that could be directed to the wall and, if called to do so, will provide multiple courses of action for the president to review, according to the official. It is not clear yet if using military funding for the wall would automatically require redirecting military personnel—certain entities, such as the Army Corps of Engineers, frequently use contractors for projects, the defense official said. In addition, DOD has about $700 million in available funds that the Secretary of Defense could, under a separate statute, provide to the federal law enforcement agencies at the border for certain counterdrug activities, according to the official. Trump has asked Congress for $5.7 billion to build the wall. The possibility of using the military to pay for the wall is looking increasingly likely. As he departed the White House to travel to the border between Texas and Mexico Thursday, Trump warned that he will “probably” take the rare step of declaring a national emergency on the southern border if talks with congressional Democrats continue to crumble.
Fight Over Something That Matters, “The Wall” Mostly Doesn’t - Ian Welsh - So, here’s something people tend to not mention. A number of walls have already been built along the US-Mexico border. As of January 2009, U.S. Customs and Border Protection reported that it had more than 580 miles (930 km) of barriers in place.[3] The total length of the continental border is 1,954 miles (3,145 km).That cost, by the way, about 6 billion dollars. Trump wants 7 billion dollars for his wall, which obviously wouldn’t cover the entire border.The US has built walls along the border before.What is more important, I think, is that the real problem isn’t a wall or walls. The real problem is that enforcement is extremely cruel. The problem is that this cruelty is mostly bipartisan: Trump has made it worse, but most of the high profile cases which first came out happened under the Obama administration, which built plenty of camps: they just kept parents and children together in horribly inhumane circumstances.What should be done is that responsibility for illegal immigrants should be handed back to a reconstituted “Immigration and Naturalization Service“, who ran it till 2003 (after the Homeland Security reorganization shoved thru under 9/11 hysteria.)They were a lot less abusive, though the border patrol was still awful.But America wants para-militarized law-enforcement, and Americans believe that people should suffer and suffer bad, so we have current regime. Again, a ton of abuses and cruelty happened under Obama, and the child separation, while a step too far for Democrats (at least in opposition), came on top of policies which were already disgustingly inhumane. Seven billion is nothing. It isn’t even chump change in terms of the US budget. The wall is not particularly important in real terms of how it will affects people. It is a symbolic issue: Trump made it his centerpiece, the Democrats oppose it.
IRS to issue tax refunds during partial government shutdown, White House says - Americans can expect to get tax refunds during the partial government shutdown after all, following a decision by the White House Office of Management and Budget. As part of the Treasury Department, the Internal Revenue Service has been shut for more than two weeks, and had said refunds could not be paid. President Donald Trump and congressional Democrats are sparring over Trump’s proposed border wall, and about a quarter of government has been shuttered since Dec. 22. Russell Vought, the acting OMB director, said the White House is trying to make the shutdown as “painless as possible consistent with the law.” There are questions about the legality of the move, however, as it reverses past practice. Sen. Ron Wyden, the top Democrat on the Senate Finance Committee, has requested a briefing on whether Treasury and the IRS can process refunds during a shutdown and has not yet received a response, a spokeswoman told MarketWatch. Over Twitter, Harvard Law professor Laurence Tribe said the Supreme Court has held such responses unconstitutional. Before the decision, the IRS said it would continue to accept tax returns and tax payments, but would not issue refunds during the shutdown.
Hundreds of TSA screeners call out sick at major airports amid shutdown - – Hundreds of Transportation Security Administration officers, who are required to work without paychecks through the partial government shutdown, have called out from work this week from at least four major airports, according to two senior agency officials and three TSA employee union officials. The mass call outs could inevitably mean air travel is less secure, especially as the shutdown enters its second week with no clear end to the political stalemate in sight. “This will definitely affect the flying public who we (are) sworn to protect,” Hydrick Thomas, president of the national TSA employee union, told CNN. At New York’s John F. Kennedy International Airport, as many as 170 TSA employees have called out each day this week, Thomas tells CNN. Officers from a morning shift were required to work extra hours to cover the gaps. Call outs have increased by 200%-300% at Dallas-Fort Worth International Airport, where typically 25 to 30 TSA employees call out from an average shift according to a local TSA official familiar with the situation. Union officials stress that the absences are not part of an organized action, but believe the number of people calling out will likely increase. “This problem of call outs is really going to explode over the next week or two when employees miss their first paycheck,” a union official at Dallas-Fort Worth International Airport told CNN. “TSA officers are telling the union they will find another way to make money. That means calling out to work other jobs.”
Federal workers WON'T get paid on Friday if shutdown goes past midnight Tuesday – and Ben Carson is pleading with HUD landlords not to evict thousands of government employees who are behind on rent - When the federal government's paymasters process their next biweekly run of checks and direct-deposits, nearly 800,000 employees will be left in the lurch – unless a partial shutdown ends by Tuesday night at midnight. 'If we don't have an agreement I think by midnight on the 8th, which is Tuesday, then payroll will not go out as originally planned on Friday night,' Acting White House Chief of Staff Mick Mulvaney said Sunday on 'Meet the Press.' That is creating anxiety over a coming cash crunch, especially for federal workers who rely on publicly subsidized housing in parts of the country where the cost of living is high. The largest proportion of impacted workers by far are in Washington, D.C., where 1 in 8 face a lapse in their pay.The Housing and Urban Development Department sent letters Friday to more than 1,500 landlords, asking them to go easy on renters – and acknowledging that one program used to pay them a subsidy had expired permanently on January 1 without Secretary Ben Carson's office knowing it. HUD spokesman Jereon Brown told The Washington Post that staff are 'scouring for money' to bridge the gap. The Internal Revenue Service is also scrambling to find a way to process income tax refund checks for taxpayers who are filing in the early days of January, as soon as they're eligible. An administration official said Monday that a large majority of government employees, those who don't work for the federal agencies affected by the shutdown, won't notice any change in their pay schedule.But two Two White House spokespersons did not respond to requests for confirmation, adding to confusion over whose bank accounts will be light at the end of the week. The federal government is the nation's largest civilian employer, with about 2 million workers.
Why political appointees are getting a pay raise and most career feds, for now, aren’t - President Donald Trump said Friday afternoon he’d consider asking his cabinet to reject a political appointee pay raises originally set to go in effect Saturday. An executive order froze pay for career civilian employees this year at 2018 levels. But it also provided a $8,000-to-10,000 raise for the vice president and political appointees, unless Congress does something about it.But the raise for the vice president and political appointees is yet another consequence of government’s collective failure to pass appropriations bills or provide stop-gap funding for federal agencies ahead of the current partial government shutdown. Regardless of whether the consequences were intended or not, the optics look bad. Some 800,000 federal employees are furloughed or working without pay during this partial shutdown, and President Donald Trump confirmed his decision last week to freeze their pay for all of 2019. Congress has frozen pay for political appointees at least since 2014, when lawmakers included a provision holding pay rates at 2013 levels in a 2014 omnibus. The provision detailing the pay freeze has become practically standard appropriations language since then, and it has appeared in subsequent spending bills and continuing resolutions for the past four years. The Office of Personnel Management has issued separate memos describing the pay freeze every year. “The pay freeze will end on the last day of the last pay period that begins in calendar year 2018 (i.e., January 5, 2019, for those on the standard biweekly payroll cycle),” Mark Reinhold, OPM’s associate director of employee services, wrote in an April 2018 memo to agency human resources personnel. “Future congressional action will determine whether the pay freeze continues beyond that date.” But Congress didn’t act, meaning that raises for a group of political appointees were set to kick in. The president’s most recent executive order implemented automatic pay adjustments for the Executive Schedule, as described in Title 5 statute.
78% Of Americans Live Paycheck To Paycheck (Including Many Government Workers Affected By The Shutdown) - President Trump is pledging that he will not sign any spending bill unless it includes funding for a border wall, and the Democrats are promising their supporters that they will never agree to a single penny for a wall. This could be the confrontation that ends up defining Trump’s presidency, and whoever backs down now is going to look incredibly weak.But the longer this shutdown lasts, the more painful things are going to become for the hundreds of thousands of federal workers that are going without pay, and for the hundreds of thousands of workers that are employed by government contractors that rely on business from the federal government.You should never play a game of chicken with somebody that is crazier than you are. In this case, it looks like both sides fully expect the other party to blink first, but the truth is that neither side is likely to yield any time soon. So the days ahead are likely to be exceedingly painful for most federal workers, because just like the population as a whole, most of them are living paycheck to paycheck.In fact, one survey found that 78 percent of American workers are currently living paycheck to paycheck… Government workers are far from alone in feeling stressed about not getting paid. Nearly 80 percent of American workers (78 percent) say they’re living paycheck to paycheck, according to a 2017 report by employment website CareerBuilder. Women are particularly vulnerable: 81 percent of them report living paycheck to paycheck, compared with 75 percent of men. When you live paycheck to paycheck, you are just one major disaster away from financial ruin. For example, if somebody in your family has a major accident or a significant medical emergency, it can quickly render you completely destitute.
Air Traffic Control Union Sues Trump Admin Over $0 Paychecks - The National Air Traffic Controllers Association filed a lawsuit against the US government on Friday on behalf of its members who are going without pay due to the partial shutdown. Approximately 10,000 air traffic controllers under the employment of the Federal Aviation Administration (FAA) are working without pay after having been deemed essential.The FAA's funding lapsed December 22 when the shutdown went into effect, while Friday was the first day that federal workers went without paychecks. The union said in a statement that its aviation safety workers "remain on the job, dedicated to the safety of every flight, but they don't know when they will receive their next paycheck." Hundreds of airline industry employees gathered outside the Capitol on Thursday, urging and end to the partial government shutdown. Pilots and flight attendants joined unpaid air traffic controllers, whose union confirmed on Thursday morning that they would not be receiving a paycheck for the last two weeks of work. Union leaders representing the controllers and flight crews say the shutdown could threaten aviation safety the longer the impasse between President Trump and Congressional Democrats continues, according to the Washington Post. "We want to make sure we have sufficient, competent air traffic controllers at all times," said American Airlines first officer Christopher Bacon, who is also a representative of the Allied Pilots Association. "The safety implications are obvious, unfortunately, if they’re worrying about a paycheck — if they have other things on their mind other than ensuring they’re giving absolute, top-notch control of the pilots."
Senate Passes Back Pay Bill for Furloughed Feds, Trump Says He Will Sign It - The Senate voted unanimously Thursday evening to provide back pay to federal employees furloughed as a result of the ongoing partial government shutdown, and President Trump indicated he would sign it. “When we reopen, they will be paid,” said Sen. Tim Kaine, D-Va., who backed the legislation. Federal employees deemed excepted from the furloughs at affected agencies and who have been required to work during the shutdown are already guaranteed back pay when the agencies reopen. Furloughed workers, though, don’t get paid unless Congress acts to approve it. Federal employees at shuttered agencies will miss their first paychecks on Friday. Before the vote, Senate Majority Leader Mitch McConnell took to the floor and said, “I had an opportunity to talk to President Trump a few moments ago, and wanted to indicate to our colleagues that he will sign the bill that we’ve been discussing here to guarantee that government workers who’ve been displaced as a result of the shutdown will ultimately be compensated, and so I want to ease their anxiety about that particular possibility.”
Update on Shutdown impact on January Employment Report; Congress Approves Back Pay for Furloughed Employees --From the WaPo: Congress approves back pay — eventually — for furloughed federal employees. This measure is expected to be signed by the President. For the January employment report, this means that the BLS will count all Federal employees as employed in the establishment survey - whether on furlough, or working without pay. So don't expect a negative headline jobs number due to the government shutdown (although some non-government employees will likely lose their jobs if the shutdown continues). However, in the household report, furloughed employees will be counted as unemployed, so the unemployment rate will probably bump up to 4.0% or 4.1% in the January report (to be released February 1st).
Democrats call for contractors to get paid after shutdown — Senate Democrats on Thursday called on the Trump Administration to work with federal contractors so that their employees can get back pay when the partial government shutdown ends. While federal workers generally receive back pay after a shutdown, contractors do not. The Senate on a voice vote Thursday night approved legislation to provide back pay for federal workers furloughed during this shutdown. President Trump has said he will sign the bill. The request was made as the shutdown led to dramatic debate in the Senate, where Democrats tried unsuccessfully to bring about votes on House-passed legislation that would reopen the government. Senate legislation that’s being drafted calls for back pay to compensate low- and middle-income contractor employees with they wages they’re losing during the shutdown. It’s similar to a bill introduced this week sponsored by in the House by D.C. Del. Eleanor Holmes Norton called the Low-Wage Federal Contractor Employee Back Pay Act. “Contract workers and their families should not suffer the consequences of a shutdown that they did not cause,” 34 Democratic senators said in a letter sent to the Office of Management and Budget.
US shutdown could leave millions without food stamps -- As the US government shutdown continues, millions of Americans face the prospect of being cut off from food stamps. The Supplemental Nutrition Assistance Program, or SNAP, provides benefits that allow some of the nation’s poorest households to buy food. More than 19 million households, or about 39 million people in the US, currently receive food stamps. The average monthly benefit is $245. Now even this minimal aid stands to be withdrawn—partially in February and completely in March—if the government shutdown drags on.The US Department of Agriculture (USDA) has furloughed approximately 95 percent of employees in Food and Nutrition Services, the office that oversees the SNAP program. So as USDA workers go without pay, food stamp recipients’ benefits may also be slashed.Come February, the SNAP program faces a $1.8 billion shortfall. If this were spread out evenly across the 19 million households that receive SNAP benefits, each would see a cut of about $90 per month, according to the Center for Budget and Policy Priorities (CBPP).If the shutdown that began December 22 stretches into March, current SNAP recipients would receive no money. Even if the Trump and administration and Congress come to an agreement to end the shutdown by February, households could experience a substantial delay in receiving their benefits due to operational and bureaucratic challenges at the USDA.
Trump team promises shutdown won’t stop food stamp payments in February, says program lacks funds for March - WaPo - The Trump administration pledged Tuesday that Americans will receive food stamps through February despite the partial government shutdown, but officials could not promise those benefits will continue if the shutdown lasts until March. Congress has only approved funding for the Supplemental Nutrition Assistance Program through January, fueling concern food benefits used by 38 million Americans would expire amid the budget stalemate in Washington.In a call with reporters on Tuesday, Agriculture Department officials said that they will give states the money for February’s food stamps ahead of time — by Jan. 20 — to circumvent the expiration of federal appropriations. States, which administer the SNAP program, will have to ask for the money to be allocated earlier than they normally would.The move is part of attempts by the Trump administration to limit the pain inflicted by the government shutdown now in its third week, as officials scramble to prevent essential federal services from expiring.“I know there has been genuine concern across America” about food stamp benefits, said Agriculture Secretary Sonny Perdue. “The benefits for February will be provided. … It works and is legally sound.”SNAP beneficiaries will not see cuts to their benefits through the end of February even if the shutdown continues, said Brandon Lipps, acting deputy undersecretary for Food, Nutrition and Consumer Services.
'It's a Crisis Alright': Report Details Serious Public Health and Safety Risks of Trump Shutdown - In addition to pushing thousands of low-wage workers to the brink of financial collapse and imperiling life-saving public programs like food stamps and Medicare, a Public Citizen report released on Wednesday found that the government shutdown over President Donald Trump's demand for border wall funding is also placing crucial consumer, health, and safety protections at serious risk. "The shutdown is already impeding vital consumer and worker protection priorities. If the shutdown is allowed to persist, the cessation of these essential consumer and worker protections threatens significant public harms." —Rick Claypool, Public Citizen "Corporate lawbreakers are going unpunished, safety inspections are being postponed, discrimination charges are going uninvestigated, polluters are not being held in check, financial fraudsters are not being policed, consumer complaints are not being received, and accident investigations have ceased," Robert Weissman, president of Public Citizen, said in a statement. Authored by Rick Claypool, a research director at Public Citizen, the new report examines how nearly a dozen federal agencies have been impacted by the Trump shutdown, which has furloughed hundreds of thousands of government employees. According to Public Citizen's analysis, under-discussed but extremely important federal agencies like the Consumer Product Safety Commission, the Equal Employment Opportunity Commission, and Securities and Exchange Commission are currently operating without over 90 percent of their staff due to the shutdown, which is just days away from becoming the longest in U.S. history. "The shutdown is already impeding vital consumer and worker protection priorities. If the shutdown is allowed to persist, the cessation of these essential consumer and worker protections threatens significant public harms, as corporate violators go unpunished and food and product safety inspections are delayed and decreased," Claypool writes. "The importance of these functions makes even slight capacity reductions a serious cause for concern."
FBI agents warn about impact of shutdown investigations, national security — As the ongoing partial government shutdown approaches record territory, members of the nation’s law enforcement arm are putting out a warning about the impact it’s having on public safety and national security.The FBI Agents Association, which represents nearly 13,000 active-duty, rank-and-file agents around the country, has released a petition calling for the FBI to be funded immediately.The bureau is part of the Department of Justice, one of several agencies that have gone nearly three weeks without any money. The impact is starting to get noticed by field agents around the country. “Investigations and our tools to conduct those investigations are limited because of the shutdown and will only become more limited,” warned Tom O’Connor, an agent in the Washington Field Office and the president of the FBI Agents Association. “Operations are being hindered.”He pointed to a growing backlog at the FBI’s Quantico, Virginia, crime lab, which helps process forensics investigations for the bureau as well as for police departments around the country. O’Connor added: “Special agents are often involved in activities that require access to funds, such as undercover operations, drug-trafficking operations and work with informants.“The lapse in funding for the FBI limits the funds available to support investigations.” This weekend is supposed to be payday for agents, but because the bureau is operating without funding, agents aren’t getting paid for the work they’re doing, something O’Connor said agents are well aware of. In the long term, that could also have an impact on their ability to keep their jobs.
US government shutdown leaves websites insecure - The US government shutdown is making many official websites harder to access and potentially leaving users more vulnerable, tech experts are warning. Affected websites include the US Department of Justice, the Court of Appeals and Nasa. The shutdown, over a funding row for President Trump's wall, has left thousands of federal workers unpaid. One of the side effects of this situation is that security certificates for websites are not being renewed. Digital certificates ensure that communications between devices and websites are sent in an encrypted, secure manner and are an essential part of keeping IT infrastructure up and running. But, when issued, they are given an expiration date of anything between a few months and several years. According to internet services website Netcraft, more than 80 security certificates used by .gov websites have expired. This includes the US Department of Justice, which is using a certificate that expired in the week leading up to the shutdown and has not been renewed since. The Department of Homeland Security's newly-created cyber-security and infrastructure security agency, is currently operating with less than half its staff, according to Suzanne Spaulding, a former under-secretary at the agency. She said: "With each passing day, the impact of the government shutdown on our nation's security grows. Meanwhile, our adversaries are not missing a beat and the daily attacks on our systems continue.
Gaming out the government shutdown - There are 4 possible outcomes:
- 1. Trump capitulates. This is only going to happen if large portions of Trump's own base abandon him, as they did with the child separations at the border.
- 2. Pelosi and the Dems capitulate. If negotiations are off the table, and Trump's base doesn't turn against him, this is the more likely outcome.
- 3. Trump, the GOP, and the Dems negotiate a deal. This happens if all sides can claim "victory." Trump gets appropriations for something he can call a "wall," and Democrats get something - like the DREAM Act - they can call victory as well. Since Trump has a demonstrated history of reneging on deals after pocketing concessions, any proposed deal is going to have to get around this procedural issue.
- 4. The Dems and the GOP negotiate a veto-proof deal. If Trump's base does not turn on him, but Congressional GOPers fear for their re-election chances in 2020, there is at least a slim possibility that they could cut a deal that overrides a Trump veto.
Now let's review where we are. As I anticipated, since Pelosi was unable to obtain a 2/3's majority in the House, Trump is standing pat, and so is McConnell, since he has nothing to gain by trying to override a veto unless the House will do so as well. So at the moment we are stuck in a "win-lose" capitulation scenario, with both sides becoming more and more entrenched as each is aware that its base will be furious with capitulation. In movie terms, this is a game of chicken where both drivers are speeding towards a cliff. Right now, actually going over the cliff looks like the most likely scenario. "Going over the cliff" means that more and more government services shut down, and more and more pain is inflicted on an ever-increasing number of people. The shutdown will continue until there is so much widespread pain inflicted on average Americans that they scream for both sides to make it end, without really caring who caves in. The first and most likely place for pain to be felt is airline travel, which is already starting. As more TSA security either fail to show up or outright quit, air travel will become very unpleasant. Slowdowns by overstressed air traffic controllers and by pilots aren't unlikely either. But that is probably not enough. The more likely sources of the widespread pain are either (more likely) tax refund checks and/or Social Security checks stop going out; or (less likely) a widespread outbreak of food-borne illness due to lack of FDA inspections. But let's be clear on something unpopular: if we do go over the cliff, it is because *all* of the parties, including the Democrats, are willing to see widespread pain inflicted on ordinary Americans, rather than be seen to be capitulating. As an aside, let's also be clear that there is a large faction of the GOP -- what Digby and Atrios call "E Coli conservatives" - who are perfectly happy with this, since they favor a return to 1859 anyway, minus the messy slavery bit. In this case, the plurality if not majority of people are not going to care about apportioning blame. They are going to want "both sides" to give something up to get the government open. That probably means that the Democrats get nothing affirmative, but the funding for Trump's "wall" is cut back. This comes closest to scenario #2, although it does involves some capitulation by Trump as well.
Trump’s ‘National Emergency’ Gambit May Be The Easiest End To The Shutdown The partial government shutdown is about to stretch past its third week. Republicans and Democrats have basically stopped negotiating. Yet, members and aides on Capitol Hill believe a solution is imminent. It’s not that there’s going to be a legislative breakthrough. It’s more that everyone now recognizes there is no deal to be made ― not when President Donald Trump won’t come down from his $5.7 billion figure for border wall construction, conservatives oppose a larger immigration deal, and Democrats don’t trust and won’t accept any offer but full capitulation. Instead, the solution to the impasse seems to be Trump declaring a national emergency at the border, using a dubious authority to reprogram military construction money for the wall, and then Congress passing clean funding legislation ― without wall money ― while Trump’s executive maneuver gets tied up in court. Trump has moved from toying with the idea of a national emergency declaration to all but promising it. He said Thursday that, if negotiations don’t work out, “probably I will do it. I would almost say definitely.” Three senior GOP aides said Thursday that they expect Trump to declare a national emergency as a way of getting out of the shutdown, though all said they hadn’t heard anything specific about timing. And while there’s been a scramble among some lawmakers to put together a deal involving the Deferred Action for Childhood Arrivals immigration program in exchange for wall funding, that offer seems to be dead on arrival./p>
Trump’s Long Shutdown Could Destabilize the World - President Donald Trump in a meeting with congressional Democrats on Friday said he was prepared for the partial government shutdown to continue for months — or even years — if he doesn’t get the money he wants for a wall along the Mexican border. It’s not hard to see how that prediction comes true. Both sides have framed the issue such that a victory for one side on funding a border wall entails defeat for the other. Neither side has much incentive to compromise. Suppose Trump is right. The longest shutdown on record is 21 days, from late December 1995 to early January 1996. (This is the 21st in the modern era.) What would a much longer shutdown mean for U.S. political life? Judging by public reaction thus far, you might think the answer is, not much. After all, we’ve become increasingly inured to Trump’s attempts to break established quasi-constitutional customs. Maybe keeping the government open is just another unwritten norm; maybe breaking it isn’t the end of the world. Yet the likelihood is that a long shutdown would exert real negative gravitational pull on the stability of American government. There are key factors at play. First, there’s the message of dysfunction. Passing a budget — even a stopgap budget — to keep the government open is a sign that both the Democratic and Republican parties see the management of the government as a common task. They might differ deeply on policy priorities. But they agree that the government is necessary to effectuate the commands of the legislature and the president and to keep the country humming. When and if the two parties reach a standoff they are genuinely unwilling to resolve, the message they are sending to the country and the world changes. Instead of a message of underlying cooperation, the message will be of underlying disagreement — with cooperation only accidental and occasional. The world’s confidence in the U.S. government — and by extension, the U.S. economy — depends on seeing the American polity as basically functional. A functional federal government performs the basic tasks of preserving societal stability. Stability depends on more than just national security, which will be maintained during the shutdown. It includes basic regulatory functions: of the markets, the environment, food and drugs, and so on. Those function aren’t consistently sustained during a shutdown. In a short shutdown, the public understands that the government will play catch-up in the aftermath. So stability isn’t disrupted. In a long shutdown, it is far from clear that the catch-up will make up for the regulation that will be lost. Slowly, gradually, maybe even imperceptibly, the social functions that depend on regulatory stability will begin to erode.
Voted Down on Tuesday Night, McConnell Raises Alarm by Forcing Second Vote on 'Unconstitutional' Anti-Boycott Bill - Less than 24 hours after Senate Democrats successfully voted down a motion to proceed to legislation that would give states and localities more power to punish pro-Palestinian boycotts of Israel, rights groups raised alarm and urged Americans to call their senators immediately on Wednesday as Senate Majority Leader Mitch McConnell (R-Ky.) moved to bring the bill up for yet another procedural vote. "McConnell apparently has no more important business to take care of in the Senate than trying to force a vote twice in 24 hours to strip away our First Amendment right to boycott for Palestinian rights." —Josh Ruebner, U.S. Campaign for Palestinian Rights "When was the last time the Senate voted twice in less than 24 hours to consider the same bill?" Josh Ruebner, policy director a the U.S. Campaign for Palestinian Rights, asked on Twitter. "They're doing it right now on S.1, a bill to authorize $38 billion in weapons for Israel and encourage states to deny contracts to people who support boycotts for Palestinian rights." "McConnell apparently has no more important business to take care of in the Senate than trying to force a vote twice in 24 hours to strip away our First Amendment right to boycott for Palestinian rights," Ruebner added, alluding to the fact that the Republican leader is refusing to allow a vote on legislation to reopen the government. In response to McConnell's rapid attempt to re-vote on a motion that failed Tuesday night, Jewish Voice for Peace (JVP) issued an urgent call for people to contact their representatives and pressure them to oppose the measure again.
Congressional Staffing for Dummies: The Pay Go Dispute - Matt Stoller - There are a lot of people arguing about this thing called Pay Go. Here’s my attempted explanation of what Pay Go is and how it intersects with stuff you care about. #PayGo stands for pay as you go budgeting, a concept that in theory mean that bills Congress pass need to be deficit neutral. That is, each proposed program or law, if it costs money, should also bring in an equal amount of money through either taxes or other budget cuts. This is what’s known among centrists in Washington, D.C., and frankly among most Americans, as ‘fiscal responsibility.’ In 2010, the Obama administration and a Democratic Congress passed a law to ensure Congress would be ‘fiscally responsible. Nancy Pelosi was the Speaker in 2010 when Congress passed the statute, and she is proud of being fiscally responsible. This law says that if Congress doesn’t go through a PayGo process for its aggregate spending and taxing in the full fiscal year, the White House’s Office of Management and Budget gets to choose a bunch of programs to cut in a process known as as sequestration. Sequestration is in law. It was a law that sort of made sense at the time, because Obama was President and Democrats didn’t so much mind if a Democratically controlled OMB got to make a bunch of important decisions. But guess what? Trump is now President, which means he’s the one that gets to decide the cuts that happen if Congress doesn’t use a PayGo decision-making process. In 2018, Nancy Pelosi and House Democrats said they wanted to emphasize that they, unlike Republicans, were fiscally responsible. So she pledged to go back to the #PayGo rule, both to conform to the 2010 statute and because she’s proud being “fiscally responsibility.” The Republicans had a rule saying that a tax hike required not just a majority vote of House members, but a 60% vote. Pelosi said she would change this rule, and make it apply only to tax hikes that hit the bottom 80% of the taxpaying public. The middle class isn’t going to have their taxes raised under the Democrats! Or so the thinking went. So that’s where things stood until progressives got involved. We have a law we can’t change without the House, Senate, and the President agreeing. But we also have a rule that the House majority can itself change at any point. Now this is where it gets a bit weird. You see, the House has a rules package at the beginning of its session. But it also changes its rules pretty much every legislative day through what’s called the Rules Committee. Every time the House puts forward a bill to vote on the floor, it has to first vote on a rule for that bill. But a House rule can also change or waive any other rule at any point, including rules put forward at the beginning of the House term, like #PayGo. So in reality, anything put forward like PayGo is basically symbolic, and all that really matters is who runs the Rules Committee and what he/she had for lunch that day.
Ocasio-Cortez’s 70 Percent Top Tax Rate Is a Moderate, Evidence-Based Policy -- When Ronald Reagan took office, affluent Americans paid a 70 percent tax rate on all income above $216,000. In the decades since, our country’s highest earners have seen their annual pay skyrocket, while the median household’s has barely budged. As a result, America’s 160,000 richest families now lay claim to 90 percent of its wealth. Studies suggest that this kind of inequality erodes social trust, abets plutocracy, and depresses economic growth. Politicians from both major parties routinely suggest that they see inequality as a major problem. The case for trickle-down economics — which is to say, the idea that high top-marginal tax rates hurt economic growth — is much weaker now than it was in 1980. The U.S. saw faster GDP and productivity growth in the decades before Reagan’s tax cuts, than it did in the decades after. And during that latter era, the American economy grew at roughly the same rate as peer nations with higher top tax rates. A separate premise of the trickle-down theory held that raising taxes on the rich eventually costs the government revenue by discouraging work. The latest economic research suggests that this is true — but only if you raise the top tax rate higher than (approximately) 70 percent. French economist Thomas Piketty has demonstrated that high tax rates reduce pre-tax inequality – ostensibly, by discouraging rent-seeking among top executives, whose compensation is often determined less by productivity than a combination of social mores and their own audacity: CEOs are less likely to extract an extra $5 million from their companies (instead of allowing their firms to invest that sum in other purposes) if they know that Uncle Sam will collect 70 percent of their bonus. Thus, there is now some reason to believe that confiscatory top rates can reduce wage inequality, while producing some gains in economic efficiency. All of which is to say: In 1980, taxing incomes above $216,000 (or $658,213 in today’s dollars) at 70 percent was considered a moderate, mainstream idea, even though wage inequality was much less severe, and supply-side economics had yet to be discredited.This week, Alexandria Ocasio-Cortez told 60 Minutes that she believes the U.S. should consider taxing incomes above $10 million at a 70 percent rate. Specifically, the congresswoman suggested that taxing the rich at such a rate would be preferable to forgoing major investments in renewable energy, and other technologies necessary for averting catastrophic climate change. And centrist pundits were scandalized by her extremism.
Alexandria Ocasio-Cortez’s $21 trillion mistake - WaPo - The Defense Department is awash with money. So much money that neither the staff nor 1,200 auditors could make sense of where it all went. (The Pentagon recently failed its first big audit in history.) Enter Ocasio-Cortez. She supports expanding Medicare to people under 65, what’s known as single-payer or Medicare-for-all. But the big question is how to pay for all that health care. According to an estimate from the Urban Institute, the price tag on Sen. Bernie Sanders’s Medicare-for-all proposal would be $32 trillion over 10 years. Ocasio-Cortez claimed on Twitter that $21 trillion in “Pentagon accounting errors” could have paid for 66 percent of the Medicare-for-all proposal. Her tweet references an article in the Nation, a left-leaning magazine. The specific line about the missing $21 trillion comes from research by Mark Skidmore, an economics professor at Michigan State University. Skidmore has been tracking opaque federal budget moves for years. He tallied $21 trillion in unsupported accounting adjustments at the Pentagon from 1998 to 2015. The department’s comptroller says these are budgetary moves that “lack supporting documentation ... or are not tied to specific accounting transactions.” Skidmore contends that the Pentagon has competent personnel and is no more complex than a large multinational corporation, which makes the trillion-dollar accounting gaps all the more puzzling. Regardless, in the situation Skidmore is describing, the $21 trillion is not one big pot of dormant money collecting dust somewhere. It’s the sum of all transactions — both inflows and outflows — for which the Defense Department did not have adequate documentation. “The same dollar could be accounted for many times,” as Philip Klein wrote in the Washington Examiner. Skidmore’s paper clearly talks about Pentagon “assets” and “liabilities.” This key distinction was duly noted in the Nation article that Ocasio-Cortez referenced on Twitter. To be clear, Skidmore does not contend that all of this $21 trillion was secret or misused funding. And indeed, the plugs are found on both the positive and the negative sides of the ledger, thus potentially netting each other out. But it did not appear in her tweet, which clearly implied that the $21 trillion could have been used to pay for 66 percent of the $32 trillion in estimated Medicare-for-All costs.
Links referenced in a recent talk --Jared Bernstein - I recently spoke to members of Congress and referenced a number of pieces. Here are the links to those pieces. What are some ideas for lowering the growth of health costs? See the section starting on pg. 11 of this testimony. On our lack of investment in quality, affordable pre-K, and how we’re an international outlier in that regard. Look carefully at the 2nd figure–it tells this story well.On some ideas for progressively raising revenues. Also, see this on a financial transaction tax. On the need for fiscal stimulus in the next recession, even at “high” levels of the debt/GDP ratio. On lowering the black/white unemployment gap.
Pompeo Calls for Continued US Military Intervention in Middle East — Some ten years after President Obama’s Cairo speech, Secretary of State Mike Pompeo was in the city at American University presenting his own speech trying to contrast President Obama’s policies to the Trump Administration’s more heavily interventionist intentions in the Middle East.Pompeo argued that every instance in which President Obama ended a US intervention, or didn’t intervene at all, things turned out badly. He argued that the US government is necessarily a “force for good in the world” and that would benefit everyone.Pompeo bragged of the US having intervened against Saddam Hussein’s invasion of Kuwait, insisting the Middle East could never have gotten China or Russia to do that. He contrasted this to President Obama not attacking Syria outright during the war.And even as the US is in the process of withdrawing troops from Syria, Pompeo made clear US intervention there would continue. He vowed to see every last Iranian soldier expelled from Syria, saying the US would withhold aid from Syria until Iran complied.With respect to Iran, Pompeo bragged about the US withdrawing from the P5+1 nuclear deal, and claimed unity from Korea to Poland on complying with US sanctions against Iran. He further set the stage for more moves against Iran. In particular, Pompeo talked up a US intervention in Lebanon. He said the US will never accept Hezbollah retaining a “major presence” in Lebanon. Hezbollah, of course, is a Lebanon-based faction, including a substantial political party within the Lebanese government. Pompeo provided no indication how he thought he’d get a large Lebanese group out of Lebanon.
Brought to Jesus’- the evangelical grip on the Trump administration - In setting out the Trump administration’s Middle East policy, one of the first things Mike Pompeo made clear to his audience in Cairo is that he had come to the region as “as an evangelical Christian”. In his speech at the American University in Cairo, Pompeo said that in his state department office: “I keep a Bible open on my desk to remind me of God and his word, and the truth.”The secretary of state’s primary message in Cairo was that the US was ready once more to embrace conservative Middle Eastern regimes, no matter how repressive, if they made common cause against Iran.His second message was religious. In his visit to Egypt, he came across as much as a preacher as a diplomat. He talked about “America’s innate goodness” and marveled at a newly built cathedral as “a stunning testament to the Lord’s hand”. The desire to erase Barack Obama’s legacy, Donald Trump’s instinctive embrace of autocrats, and the private interests of the Trump Organisation have all been analysed as driving forces behind the administration’s foreign policy.The gravitational pull of white evangelicals has been less visible. But it could have far-reaching policy consequences. Vice President Mike Pence and Pompeo both cite evangelical theology as a powerful motivating force. Just as he did in Cairo, Pompeo called on the congregation of a Kansan megachurch three years ago to join a fight of good against evil. “We will continue to fight these battles,” the then congressman said at the Summit church in Wichita. “It is a never-ending struggle … until the rapture. Be part of it. Be in the fight.” For Pompeo’s audience, the rapture invoked an apocalyptical Christian vision of the future, a final battle between good and evil, and the second coming of Jesus Christ, when the faithful will ascend to heaven and the rest will go to hell. For many US evangelical Christians, one of the key preconditions for such a moment is the gathering of the world’s Jews in a greater Israel between the Mediterranean and the Jordan River. It is a belief, known as premillenial dispensationalism or Christian Zionism – and it has very real potential consequences for US foreign policy. Pompeo is an evangelical Presbyterian, who says he was “brought to Jesus” by other cadets at the West Point military academy in the 1980s.
Chaos, Repression, And Resentment - Iran Blasts Pompeo's US Force For Good Speech - Moments after Secretary of State Mike Pompeo proclaimed during his expansive Thursday speech in Cairo "America is a force for good in the Middle East," Iran's foreign minister Javad Zarif took to twitter to blast his remarks, saying US interference abroad has only created "chaos, repression, and resentment". Pompeo's speech has been cast as a repudiation of a similar US-Mideast relations speech Obama gave early in his presidency in 2009, also in Cairo, called "A New Beginning". Countering Obama's "humble Mideast policy" approach, Pompeo said confidently, "The age of self-inflicted American shame is over, and so are the policies that produced so much needless suffering." Specifically referencing what many dubbed Obama's "retreat" from the region, Pompeo set forth a contrasting vision of a strong and confident American force for good and "progress" for the Middle East. Calling out Obama's "timidity" Pompeo explained: Remember, it was here, here in this city, that another American stood before you. He told you that radical Islamist terrorism doesn't stem from an ideology. He told you that 9/11 led my country to abandon its ideals — particularly in the Middle East. He told you that the United States and the Muslim world needed 'a new beginning.' The results of these misjudgments have been dire.Following the Trump administration's scrapping the Obama-brokered 2015 Iran nuclear deal (JCPOA), Pompeo specifically lashed out at Iran while casting US actions in the region as noble and bringing freedom: For those who fret about the use of American power, remember this: America has always been and always will be a liberating force, not an occupying power. We've never dreamed of domination in the Middle East. Can you say the same about Iran? Pompeo asserted the US has never been "an empire-builder or an oppressor," and noted at one point that "when the mission is over, when the job is complete, America leaves."
Iran to Deploy Warships in Atlantic to Counter US Influence in the Gulf - — The Iranian navy will deploy warships to the Atlantic in March, a top commander has said, as the Islamic Republic seeks to increase the operating range of its naval forces to the backyard of the United States. Iran sees the presence of US aircraft carriers in the Gulf as a security concern, and its navy has sought to counter that by showing the flag near US waters. A flotilla will leave for the Atlantic early in the Iranian new year, starting from March, Iran’s naval deputy commander said on Friday. “The Atlantic Ocean is far, and the operation of the Iranian naval flotilla might take five months,” Rear-Admiral Touraj Hassani was quoted as saying by the state news agency IRNA. He said the Sahand, a newly built stealth destroyer, would be one of the warships. The Sahand has a flight deck for helicopters and is equipped with anti-aircraft and anti-ship guns, surface-to-surface and surface-to-air missiles and has electronic warfare capabilities. Hassani said in December that Iran would soon send two to three vessels on a mission to Venezuela. A senior Iranian military official said last month that the navy could sail in the Atlantic near US waters since US aircraft carriers were allowed to move around in international waters near Iran. Iran’s navy has extended its reach in recent years, sending vessels to the Indian Ocean and the Gulf of Aden to protect Iranian ships from Somali pirates. “By their continuous presence in international waters, Iranian naval forces aim to implement the orders of commander-in-chief of the armed forces [Supreme Leader Ayatollah Ali Khamenei], wave the flag of the Islamic Republic of Iran, thwart the Iranophobia plots, and secure shipping routes,” Hassani said.
Why the United States Won’t Be Able to Quit Syria - With his decision to withdraw U.S. troops from Syria, Trump has wounded, perhaps mortally, the neoconservative plan to use the Kurds as a lever against both Turkey and Iran. But don’t believe for a second that the great game is over. Grand pronouncements that Trump’s Syria decision signals a departure from the Middle East are to be viewed with the greatest suspicion. It isn’t beyond the realm of possibility that this retreat by Trump on one anti-Iranian front will be attended in the future with an advance on another. After ISIS’s spectacular victories in 2014. Obama opened two new fronts in the war on terror, one in Iraq and the other in Syria, one legal and the other illegal, one justifiable and the other not. In Iraq, there were good reasons to support the government, as the U.S. did. In Syria, however, other motives were at work. The official imperative to work for Assad’s overthrow conditioned and essentially dictated the U.S. effort against ISIS. Because the United States would not work with Assad and Russia, it had to collaborate with the Kurds. And indeed the Kurds, with some 10 percent of the population, became the only real support within Syria for U.S. operations. That had the very bad effect of enraging the Turks and extending Kurdish territorial control over non-Kurdish regions, all of which was doubtless attended by American promises of future support for the Kurds. A U.S. troop withdrawal from Syria is highly desirable, and breaking those pledges to the Kurds at some point might have been unavoidable (we don’t really know what was promised). To do so abruptly and without explanation, however, is difficult to justify. A responsible policy of disengagement—a course seemingly favored neither by Trump nor by most domestic critics, with the distinguished exceptions of Steven Simon and Joshua Landis—would be to work with Russia, Syria, and Turkey to secure an autonomous Kurdish region within the context of an armistice or peace settlement. A U.S. withdrawal would then proceed in steps so as to lessen the danger of a bloodbath. How all this will be unscrambled remains to be seen. Trump, after consultations with Turkish President Recep Tayyip Erdogan on December 23, has extended the troop pullout deadline to 120 days. It could yet shift again. Turkish forces appear restless.
No Syria withdrawal without Turkish pledge not to attack Kurds, Bolton says— President Donald Trump will not withdraw American troops from northern Syria until the Turkish government guarantees it won’t then attack Syrian Kurdish forces that have been critical allies in the fight against ISIS, national security adviser John Bolton said Sunday.Bolton said a commitment from Turkish President Recep Tayyip Erdogan that protects the Kurds after American forces exit is something Trump is demanding, and that it’s just one of several conditions that have to be met before U.S. troops leave.“There are objectives that we want to accomplish that condition the withdrawal,” Bolton said. He spoke to reporters traveling with him to Israel and Turkeyas he tried to clarify Trump’s Syria withdrawal policy for allies. He’s meeting with Israeli officials Sunday and Monday, and with Turkish officials, including Erdogan, on Tuesday.Since Trump abruptly announced on Dec. 19 that all U.S. forces in Syria would exit immediately, administration officials have shifted the timing to say it would happen more slowly. Officials are now setting a series of conditions for withdrawal that must first be met, which Bolton described as “policy decisions that we need to implement.”“This is a cause and effect mission,” Bolton said. “Timetables or the timing of the withdrawal occurs as a result of the fulfillment of the conditions and the establishment of the circumstances that we want to see. And once that’s done, then you talk about a timetable.”Bolton also indicated that the U.S. troop withdrawal will not be a complete drawdown, as Trump had promised. Instead, he discussed a withdrawal of American forces from northern Syria, where most of the estimated 2,000 U.S. troops are based, while leaving some of them in the southern part of the country.Stressing that despite conditions for withdrawal,the continued presence of U.S. forces in Syria is not unlimited. “The primary point is we are going to withdraw from northeastern Syria," Bolton said.“So it’s going to be a different environment after we leave, there is no question about that,” he added. “But there is no desire to see Iran’s influence spread that’s for sure.”
Reasons to Believe in Trump’s Syria Withdrawal Are Vanishing - Caitlin Johnstone — On the first of April last year I published an article titled “Ignore The Words Of US Presidents. Watch Their Actions Instead.”, about Trump’s claim that his administration would be pulling troops out of Syria “very soon”. Watching the actions and ignoring the words is a personal policy I’ve found very useful in dealing with top government figures who understand that power has nothing to do with truth and everything to do with narrative control, and in that particular case the president’s claims were quickly memory holed after a highly suspicious chemical weapons allegation in Douma a few days later. The president’s words said the troops were leaving, and what actually happened was the US bombing the Syrian government for a second time in a year while troops remained where they were.Everyone completely lost their shit last month when the president once again made the claim that US troops will be brought home from Syria. Establishment loyalists of the political/media class went into full meltdown, Mattis handed in his resignation, and #Resistance Twitter pundits who’d never typed the word “Kurd” in their lives suddenly became self-appointed experts on the geopolitical dynamics between the Turkish government and the YPG. Support for the president’s words also rushed in from anti-interventionists and anti-imperialists everywhere, as well as from a few surprising places like Democratic Representative Ted Liu and Democratic Senator Elizabeth Warren.So there was a very strong reaction to Trump’s words about Syria. But what have his actions been? If we look at this administration’s actual behavior with the narrative soundtrack on mute, what we see is a significant increasing of the number of troops in Syria, bombing the Syrian government twice, committing war crimes in Raqqa, providing full-throated support for hundreds of Israeli air strikes against Iranian targets in Syria, and a steadily increasing number of indications that the troops won’t be coming home at all.Trump: We're leaving Syria.Bolton: We're not really leaving Syria.Trump: We're leaving Syria very slowly.Graham: Very, very slowly.Bolton: Or maybe never.Trump: When ISIS is completely gone.Bolton: And Iran. Trump: I hired Bolton and regret nothing.https://t.co/v5flv6cbSe
With Golan Heights at Stake, Netanyahu and Bolton Set Trump Straight on Syria — The state of Israel seems to share at least some of the responsibility for the latest shift of U.S. Syria policy — as National Security Adviser John Bolton announced on Sunday that President Donald Trump’s call to withdraw U.S. troops from Syria would now be “coordinated” with Israel, after meeting with top Israeli officials including Israeli Prime Minister Benjamin Netanyahu. Israel’s main motivation in preventing a swift U.S. exit from Syria was also made explicit by Netanyahu, who openly stated on Twitter that Israel’s push to obtain sovereignty over the occupied Golan Heights – which is internationally recognized as part of Syria – was the driving factor behind Israel’s recent efforts to dramatically slow down Trump’s plan for an “immediate” withdrawal of U.S. troops currently occupying Syrian territory illegally. As MintPress noted at the time of Trump’s withdrawal announcement, Israel’s influence on Trump’s Middle East policy and Israel’s push towards containing “Iranian influence” in Syria would mean that Trump’s plan to withdraw troops over the alleged defeat of ISIS would likely never materialize if it was opposed by Tel Aviv. This was apparently and not surprisingly the case as, soon after Trump’s announcement that he planned to bring U.S. troops home from Syria last month, Israel’s government announced that it would dramatically rev up its direct involvement in the Syrian conflict in the U.S.’ absence. . Israel’s threat of escalation revealed Israel’s unwillingness to see foreign pressure on Damascus reduced.Israel’s military — currently headed by Netanyahu, who is also serving as Israel’s defense minister — made good on this promise to increase its military involvement in Syria soon after, using civilian airplanes as cover to launch airstrikes on Syria on Christmas Day. . After meeting with Netanyahu and the director of Israeli intelligence, Bolton noted on Twitter that the “U.S. drawdown in Syria” would now be “coordinated” with Israel. Also on Sunday, Bolton announced that the U.S. had no timetable for troop withdrawal from Syria and that the troop withdrawal was also conditional.
Syria Policy: The Hawks’ Talons Sink Deeper Into Trump -- Amid the chaos that is the making of foreign policy in the Trump White House, one can only guess about any conversations between the president and National Security Advisor John Bolton since the president’s pre-holiday tweeted announcement on withdrawing U.S. troops from Syria.. Whatever may have transpired between the president and his security advisor, Bolton has in effect overruled the troop withdrawal decision. Speaking in Israel, Bolton stated that two conditions must be met before a withdrawal of U.S. troops, and the conditions amount to a recipe for indefinitely prolonging the deployment. One is that the United States must “make sure ISIS is defeated and is not able to revive itself and become a threat again”—an objective that is impossible for the 2,000 U.S. troops in Syria to achieve. With the mini-state of the Islamic State (ISIS or IS) largely gone, whatever threat the group poses is a matter not of military control of a patch of Syria—a patch of “sand and death,” as Trump put it—but instead of ideology, politics, fear, and hatred that cannot be described on a battle map. Bolton’s other condition is to obtain some sort of guarantee from Turkey not to attack the Kurdish forces in northeast Syria that have functioned as clients of the United States but that Ankara sees as auxiliaries of an anti-Turkish terrorist group. Again, this is not a box likely to be checked no matter how long U.S. troops stay in Syria. A U.S. withdrawal would give the Kurds incentive to move in the direction least damaging to their interests: striking a deal with the Bashar al-Assad regime in which the Kurds give up any hope for independence in return for some form of limited autonomy. But as long as the United States keeps promising protection to the Kurds and offers its own troops as a tripwire to guarantee such protection, that incentive is missing. . In his initial reaction to the turnabout in U.S. policy, Turkish president Recep Tayyip Erdogan certainly gave no indication of willingness to offer any guarantees. He instead stated in a speech to the Turkish parliament that Bolton had made a “serious mistake” in imposing the condition. Bolton in effect added a third condition when, speaking at a joint press conference with Israeli Prime Minister Benjamin Netanyahu, he stated that any withdrawal would have to “ensure the security of Israel and other friends in the region.”
Media Worried US Won’t Occupy Syria Forever - In December, President Donald Trump said that he planned to withdraw the US troops from Syria, which number between 2,000 and 4,000. Trump’s claim was widely condemned in corporate media, demonstrating the commentariat’s shared belief in American benevolence toward other peoples, in Washington’s alleged right and duty to decide other countries’ fates, and in the forever war the US supposedly has to wage in the Middle East. One consistent theme in the coverage was the view that US troops need to stay in Syria because ISIS still exists. Another is that US forces must remain there because the governments of Russia, Syria and Iran want the US to leave. A New York Times editorial (12/19/18) said it would be “dangerous” for the US to withdraw from Syria. “No one wants American troops deployed in a war zone longer than necessary,” the editors claimed. The paper endorsed the perspective that “the job” of fighting ISIS “is not yet done,” going on to write thatan American withdrawal would also be a gift to Vladimir Putin, the Russian leader…. Another beneficiary is Iran, which has also expanded its regional footprint.According to this view, the US should get out of Syria once a US presence there is no longer “necessary,” but it’s “necessary” until some unspecified benchmark for annihilating ISIS has been reached, and never mind the costs to Syria: A US-led bombing ostensibly aimed at ISIS leveled Raqqa, a major Syrian city, killing and injuring civilians en masse in what former Defense Secretary James Mattis called a “war of annihilation.”It’s also apparently “necessary” to stay until Syria has a government that is not allied with Russia or Iran, even though in practice this pursuit has contradicted the goal the editors just outlined, eliminating ISIS: US efforts to help bring down the Syrian government of President Bashar al-Assad, as well as the US invasion of Iraq, helped create the conditions for the emergence of ISIS in Syria.What the a uthors are suggesting is that the US should maintain an illegal presence in Syria until the Syrian government has been overthrown and replaced with one that has partnerships to which the US assents. Because all evidence suggests that Russia will fight to keep its Syrian partner in power, in practical terms the authors are arguing that it’s “necessary” for the US to occupy Syria forever, or until the US fights World War III with Russia.
Turkey Slams Pompeo for `Don't Slaughter the Kurds' Remarks - Turkey issued a written statement to denounce U.S. Secretary of State Mike Pompeo for saying the U.S. wanted to ensure that “the Turks don’t slaughter the Kurds” as it withdraws forces from Syria.Turkey condemned the comments for both their tone and content, its Foreign Ministry spokesman Hami Aksoy said in a statement on Friday. Turkey also criticized Pompeo for using the general term “Kurds” to refer specifically to the YPG, a U.S.-backed Kurdish militia that Turkey considers a terrorist organization.The statements highlight lingering tensions between Turkey and the U.S., which have the two largest armies in NATO, over the YPG militia the U.S. armed and supported in Syria as part of its strategy to combat Islamic State. President Donald Trump’s abrupt decision to withdraw from Syria last month left the YPG scrambling for cover from the Syrian government and Russia, as Turkey massed forces on the border in preparation for an invasion.Trump later downplayed the contribution made by Kurds in the battle against Islamic State, saying they’re “better fighters when they have U.S. fighters jets helping them,” and accusing them of selling oil to Iran. His decision to withdraw from Syria, apparently made during a phone call with Turkish President Recep Tayyip Erdogan, prompted the resignation of U.S. Secretary of Defense Jim Mattis in protest. Brett McGurk, the chief U.S. envoy for the coalition against Islamic State, also resigned.“Turkey will decisively continue its struggle against terrorist organizations” including the YPG, the Turkish statement on Friday said. It said Turkey is hosting hundreds of thousands of Syrian Kurds who’ve fled the YPG and are still unable to return home due to the group’s abuse of local populations.Pompeo’s comments came in an interview with Newsmax in which he declined to give a timetable for the U.S. withdrawal. “Not only the withdrawal, but all of the other elements that the president laid out: the importance of ensuring that the Turks don’t slaughter the Kurds, the protection of religious minorities there in Syria, all of those things are still part of the American mission set,” he said. “We still have lots of things to work on with the Turks.”
Turkish President Recep Tayyip Erdogan furious at US envoy John Bolton - Turkish President Recep Tayyip Erdogan on Tuesday condemned comments by a key US envoy over the future of a US-allied Syrian Kurdish militia as a “grave mistake”, as tensions flared over Washington’s planned withdrawal from war-torn Syria. Erdogan’s comments came shortly after US President Donald Trump’s national security adviser, John Bolton, held talks in the Turkish capital with Erdogan’s adviser Ibrahim Kalin, in a meeting focusing on the surprise US decision to withdraw its troops from Syria. But it was comments made by Bolton on Sunday in Israel that had already raised hackles in Ankara, when he suggested the retreat was also conditional on the safety of US-backed Kurdish fighters, considered terrorists by Turkey.“John Bolton has made a grave mistake on this issue,” Erdogan told his party’s lawmakers in parliament. Trump caused a political storm last month when he announced the troop pull-out, claiming to have succeeded in the battle against Islamic State (IS) group.Fighting continues however, with Syrian Observatory for Human Rights saying IS suicide attackers had hit the US-backed Syrian Democratic Forces in eastern Syria late on Sunday, killing 23 of its fighters. The withdrawal, which Washington has since stressed will be gradual, was hailed by Erdogan as the “right call” in a column published Tuesday in The New York Times.
Turkey's Erdogan shuts down White House's Bolton on Syria, says he made a 'serious mistake' - Turkey's President Recep Tayyip Erdogan issued a blunt put-down Tuesday against White House national security advisor John Bolton over his pledges to ensure Turkish nonaggression against Kurds who fought against the Islamic State in Syria. "We cannot accept Bolton's messages given from Israel," the Turkish president said, adding that Bolton made a "serious mistake," Reuters reported.He was referring to statements by the senior Trump administration official, made from Israel over the weekend, promising safety for the U.S.-allied Kurdish militias — who dominate areas in Northern Syria and whom the Turks view as terrorists — in the event of a U.S. military withdrawal. The militias, known as the Kurdish People's Protection Units (YPG), are the armed wing of the Democratic Union Party (PYD), an offshoot of the designated terrorist group called the Kurdistan Workers Party, which has carried out a decades-long insurgency against the Turkish state. They're also America's primary partners on the ground in Syria: The Pentagon has been supplying the YPG with weaponry, air support and training to battle IS since 2015, and the militias have suffered thousands of casualties fighting for the U.S.-led coalition.Erdogan stressed that the YPG and the PYD cannot be representative of Kurds, adding that Bolton "probably doesn't know" who the two groups are. He also described Turkey as facing a "critical juncture" in Syria, with whom it shares a 500-mile border. Ankara has for months threatened a military offensive against the Kurds in northeastern Syria, refusing to view their presence as legitimate. That threat has been made all the more real since President Donald Trump's shock announcement on Dec. 19 to quickly withdraw all U.S. forces from Syria, a move met with torrents of criticism from security experts and lawmakers alike. Trump, defending his decision, emphasized the need for other countries to take on the battle against IS in Syria and espoused Turkey's subsequent offer to fill America's shoes. Critics say this will primarily mean Turkish violence against the Kurds.
Bolton says Turkey must not attack Kurdish fighters once U.S. leaves Syria -On Sunday National Security Advisor John Bolton tried to set conditions for a U.S. retreat from Syria: Bolton, on a trip to Israel and Turkey, said he would stress in talks with Turkish officials, including President Tayyip Erdogan, that Kurdish forces must be protected. ...Asked whether a U.S. withdrawal would not take place in Syria until Turkey guaranteed the Kurdish fighters would be safe, Bolton said: “Basically, that’s right.” ..."We don’t think the Turks ought to undertake military action that’s not fully coordinated with and agreed to by the United States at a minimum,” Bolton said, “so they don’t endanger our troops, but also so that they meet the president’s requirement that the Syrian opposition forces that have fought with us are not endangered.”Turkey was not amused. The YPG Kurds, which the U.S. uses in Syria as cannon fodder to fight the Islamic State, are the same organization as the PKK which acts as a terrorist group in Turkey. Turkey can not allow that group to exist on its border as an organized military force.When Bolton landed in Turkey today he received a very cold welcome. The planned meeting with the Turkish President Erdogan did not take place. The meeting John Bolton, Joint Chief of Staff Joe Dunford and Syria envoy James Jeffrey held with the Turkish National Security Advisor Ibrahim Kalin was downgraded and took less than two hours. A planned joint press conference was canceled. The U.S. delegation did not look happy, or even united, when it left the presidential compound in Ankara. Shortly after Bolton's meeting Erdogan held a speech to his parliament group. It was a slap in Bolton's face. Via Raqip Solyu: Erdoğan: “YPG/PKK are terrorists. Some say ‘don’t touch them because they are Kurds’. This is unacceptable. Everyone can be a terrorist. They could be Turkmans. Their ethnicity doesn’t matter. Bolton made a big mistake by his statements”
Bolton's Continued Humiliation: Turkey Seeks Coordination With Iran And Russia On US Exit - After Ankara slammed the door in John Bolton's face during his trip to Turkey in which he expected to meet with Turkish President Erdogan, only to have Erdogan skip that meeting to criticize the US national security advisor in a speech to parliament, Turkey is now calling for Iran and Russia to step up coordination with Turkey in northern Syria as US troops withdraw.It's but the next humiliation for Bolton, who flew out of Turkey on Tuesday, and for White House policy in the Middle East, after he announced preconditions to American troop draw down that emphasized Turkey agreeing to not attack the US-backed Kurds in Syria. Erdogan slammed this as a "serious mistake" and pro-government Turkish media painted the picture of a "soft coup" underway against Trump being orchestrated by Bolton and other subverters who had "rogue". But no doubt adding insult to injury, Turkish Foreign Minister Mevlut Cavusoglu issued further provocative words on Wednesday, noting that given "certain difficulties" of confused US policy, the American draw down should be coordinated with Iran and Russia to prevent a power vacuum and the reinvigoration of terrorists. “The United States [has] been facing certain difficulties with the process of the troops' withdrawal from Syria. We want to coordinate this process with Russia and Iran, with which we had arranged work in the framework of the Astana process,” the Turksih FM said. This would involve Turkish forces conducting joint patrols with Russia amidst a US withdrawal of all troops from Syria, in accord with prior agreements reached during the Astana talks, set to continue further in Moscow at a future date. Cavusoglu also said bilateral talks are being prepared between Turkey and Iran, but gave no further specifics, according to Russian media.
Turkey Threatens to Launch Major Attack on US-Backed Forces in Syria — Turkey will still launch an offensive against Syrian Kurdish forces if the United States delays the withdrawal of its troops from the war-torn country, its foreign minister has said. “If the [pullout] is put off with ridiculous excuses like Turks are massacring Kurds, which do not reflect the reality, we will implement this decision,” Mevlut Cavusoglu told Turkey’s NTV television on Thursday. “We are determined on the field and at the table… We will decide on its timing and we will not receive permission from anyone.” The warning comes as Middle East Eye revealed that US diplomats and military officials failed to present any specific details to their Turkish counterparts about Washington’s plans to withdraw its forces from northern Syria during National Security Adviser John Bolton’s visit to Ankara on Tuesday. Turkey and the US are at loggerheads over the future of Syrian Kurdish forces after US President Donald Trump made a surprise announcement last month to pull out 2,000 troops from Syria. Ahead of Trump’s move, Turkish President Recep Tayyip Erdogan threatened to launch another operation in Syria targeting the US-backed Syrian Kurdish People’s Protection Units (YPG). Erdogan, who has welcomed the pullout plan, accused Bolton of a “grave mistake” by demanding that Ankara provide assurances on the safety of the Kurdish fighters before Washington withdraws its troops. US forces have worked closely with the YPG, seen by Ankara as a “terrorist offshoot” of the outlawed Kurdistan Workers’ Party (PKK), which has waged an insurgency against the Turkish state since 1984.
“We Don’t Take Orders From Bolton”: US Withdrawal From Syria Begins – Contrary to assurances from Trump’s National Security Advisor, neocon John Bolton, and Secretary of State Mike Pompeo, who suggested earlier this week that US troops would remain in Syria for at least a little while longer, the Associated Press reported on Friday that the US has begun the process of removing the 2,000 soldiers based in northeastern Syria. Citing information provided by activists with the Syrian Observatory for Human Rights, the withdrawal officially began Thursday night local time. A convoy of about 10 armored vehicles and some trucks left the town of Rmeilan into drove into Iraq. Col. Sean Ryan, spokesman for the coalition fighting the Islamic State group, later confirmed that the US has started “the process of our deliberate withdrawal from Syria.” Trump’s abrupt decision last month to order US troops out of Syria angered former Defense Secretary James Mattis, who resigned over the decision, and stoked fears that Trump was abandoning the Kurds to a massacre by Turkish forces, who have vowed to pick up the slack in Syria when it comes to fighting ISIS. “These have been folks that have fought with us and it’s important that we do everything we can to ensure that those folks that fought with us are protected,” Pompeo said of the Kurds while visiting Irbil, the capital of Iraq’s semi-autonomous Kurdistan region, after talks in Baghdad. After launching a campaign of airstrikes against ISIS in 2014, President Obama deployed troops on the ground the following year to combat ISIS, which at the time controlled large swaths of northeastern Syria. Since then, the group has been beaten back, and now control only 1% of their former territory. Initially, Trump had said the pullout would be complete within a matter of weeks, but plans became murky after the Pentagon requested four months to complete the withdrawal. Last night, the Wall Street Journal reported that the withdrawal would begin immediately. “Nothing has changed,” one defense official said. “We don’t take orders from Bolton.”
U.S. starts withdrawing from Syria amid policy confusion - The U.S. military began the process of withdrawing its troops from Syria following a drawdown ordered by President Donald Trump, a military official said Friday. Col. Sean Ryan, a spokesman for the U.S.-coalition fighting the Islamic State group in Syria and Iraq, declined to discuss specific operational details of the pullout such as timings and troop movements, but said in an email the withdrawal was underway. About 2,000 U.S. troops are in Syria. The military has moved some cargo from Syria already, according to a U.S. Defense official who was not authorized to speak publicly about the matter. Trump's order is for a complete withdrawal of troops and their equipment. The troops in Syria have weapons, communication equipment and vehicles that will need to be moved. Planning is underway to identify facilities that can handle the equipment, the official said. No troops have left yet.It could take months to complete the withdrawal.The development comes as White House national security adviser John Bolton appeared to contradict Trump's order when he said the withdrawal would not be immediate, it would not happen before ISIS is fully defeated and it would be contingent on a pledge by Turkey not to attack the U.S.'s Kurdish military allies in Syria.None of Bolton's conditions have been met. President Recep Tayyip Erdogan refused to meet with Bolton during his visit to Turkey this week and described his conditions for the U.S. troop drawdown as a "grave mistake." Turkey considers some members of a Syrian-Kurdish Arab coalition fighting ISIS alongside U.S. troops to be terrorists and has applauded Trump's decision.
Ankara Refuses Washington's Ultimatum To Abandon Arms Deal With Moscow - Just days after President Erdogan insulted the White House by snubbing National Security Advisor John Bolton, Turkey has delivered its latest middle finger to the US by refusing to abandon its agreement to buy S-400 air defense systems from Moscow - a precondition for buying A merican-made Patriot air defense systems, according to RT.If the US ties the sales to Ankara with Turkey tearing up its existing arms deal with Moscow, Ankara will have no choice but to choose the latter, said Foreign Minister Mevlut Cavusoglu, adding that the deal to buy the S-400s has already been finalized."The S-400 deal has already been finalized. We can agree with the US on the Patriot system, but not if there will be [a condition] to abandon the S-400s," the minister said during an interview with state TV.Cavusoglu added that Ankara had received the proposal to buy weapon and would consider the terms - but warned against Washington attempting to meddle in Ankara's relationship with Moscow. The interview followed reports about the American ultimatum that circulated in Turkish media.In a sign that relations between the US and Turkey were finally beginning to thaw (this was before Trump abruptly ordered the withdrawal of the 2,000 US troops from Syria), the State Department approved the sale of 80 Patriot missiles and 60 PAC-3 missile interceptors last month.Ankara signed the deal to buy the S-400s last year, and the first batch is scheduled to be delivered later this year over vociferous objections from Washington. That came after Congress last year passed a law effectively blocking a shipment of 100 F-35 jet fighters to Turkey, which is a member of NATO along with the US.The US similarly tried to pressure India out of buying S-400s as the transaction could potentially violate American laws on sanctions placed on Russia - though Washington proposed giving New Delhi a free pass if it also agreed to buy arms from the US.Despite pressure from overseas, Turkey and India maintained that they can freely choose partners in the arms trade without interference from Washington or anybody else."We don’t need permission from anybody" to purchase the S-400s, said Turkish President Recep Tayyip Erdogan.
The Age of Trump Clearly Shows That Narrative is Everything -- Caitlin Johnstone— On Monday, President Donald Trump tweeted the following:“Endless Wars, especially those which are fought out of judgement mistakes that were made many years ago, & those where we are getting little financial or military help from the rich countries that so greatly benefit from what we are doing, will eventually come to a glorious end!”The tweet was warmly received and celebrated by Trump’s supporters, despite the fact that it says essentially nothing since “eventually” could mean anything. Indeed, it’s looking increasingly possible that nothing will come of the president’s stated agenda to withdraw troops from Syria other than a bunch of words which allow his anti-interventionist base to feel nice feelings inside. Yet everyone laps it up, on both ends of the political aisle, just like they always do. Trump supporters are acting like he’s a swamp-draining, war-ending peacenik, his enemies are acting like he’s feeding a bunch of Kurds on conveyor belts into Turkish meat grinders to be made into sausages for Vladimir Putin’s breakfast, when in reality nothing has changed and may not change at all. How are such wildly different pictures being painted about the same non-event? By the fact that both sides of the Trump-Syria debate have thus far been reacting solely to narrative. This has consistently been the story throughout Trump’s presidency: a heavy emphasis on words and narratives and a disinterest in facts and actions. A rude tweet can dominate headlines for days, while the actual behaviors of this administration can go almost completely ignored. Trump continues to more or less advance the same warmongering Orwellian globalist policies and agendas as his predecessors along more or less the same trajectory, but frantic mass media narratives are churned out every day painting him as some unprecedented deviation from the norm. Trump himself, seemingly aware that he’s interacting entirely with perceptions and narratives instead of facts and reality, routinely makes things up whole cloth and often claims he’s “never said” things he most certainly has said. And why not? Facts don’t matter in this media environment, only narrative does.
US Military Occupations Now Supported by Far More Democrats Than Republicans - Caitlin Johnstone — A new Politico/Morning Consult poll has found that there is much more support for ongoing military occupations among Democrats surveyed than Republicans.To the question “As you may know, President Trump ordered an immediate withdrawal of more than 2,000 U.S. troops from Syria. Based on what you know, do you support or oppose President Trump’s decision?”, 29 percent of Democrats responded either “Somewhat support” or “Strongly support”, while 50 percent responded either “Somewhat oppose” or “Strongly oppose”. Republicans asked the same question responded with 73 percent either somewhat or strongly supporting and only 17 percent either somewhat or strongly opposing.Those surveyed were also asked the question “As you may know, President Trump ordered the start of a reduction of U.S. military presence in Afghanistan, with about half of the approximately 14,000 U.S. troops there set to begin returning home in the near future. Based on what you know, do you support or oppose President Trump’s decision?” Forty percent of Democrats responded as either “Somewhat support” or “strongly support”, with 41 percent either somewhat or strongly opposing. Seventy-six percent of Republicans, in contrast, responded as either somewhat or strongly supporting Trump’s decision, while only 15 percent oppose it to any extent. These results will be truly shocking and astonishing to anyone who has been in a coma since the Bush administration. For anyone who has been paying attention since then, however, especially for the last two years, this shouldn’t come as much of a surprise. This didn’t happen by itself, and it didn’t happen by accident. American liberals didn’t just spontaneously start thinking endless military occupations of sovereign nations is a great idea yesterday, nor have they always been so unquestioningly supportive of the agendas of the US war machine. No, Democrats support the unconscionable bloodbaths that their government is inflicting around the world because they have been deliberately, methodically paced into that belief structure by an intensive mass media propaganda campaign. The anti-war Democrat, after Barack Obama was elected on a pro-peace platform in 2008, went into an eight-year hibernation during which they gaslit themselves into ignoring or forgiving their president’s expansion of George W Bush’s wars, aided by a corporate media which marginalized, justified, and often outright ignored Obama’s horrifying military expansionism. Then in 2016 they were forced to gaslight themselves even further to justify their support for a fiendishly hawkish candidate who spearheaded the destruction of Libya, who facilitated the Iraq invasion, who was shockingly hawkish toward Russia, and who cited Henry Kissinger as a personal role model for foreign policy.
Russia Demands US Justify Arrest Of Suspected Arms Dealer --When the news broke earlier this week that the US had arrested a Russian national in the Northern Mariana Islands, it largely flew under the radar, registering mostly in local media like the Saipan Times. But on Saturday, the story of the arrest of Dmitry Makarenko, a resident of Vladivostok who was arrested a few days after Russia took Paul Whelan - a suspected US spy who had been traveling in Moscow - into custody, reached a broader audience when Russia's Foreign Ministry acknowledged the arrest in a statement.The arrest has raised questions about whether the US intends to use Makarenko as a bargaining chip for Whelan, whose cover story has been called into question amid speculation that his arrest wasn't simply retaliation for the US's arrest and the subsequent guilty plea of Maria Butina. Butina famously admitted to infiltrating the NRA at the direction of Kremlin insiders with the intention of establishing a communication back channel between Moscow and the US. According to the statement, the Russian Embassy in Washington is seeking access to Makarenko, and has demanded an explanation for his arrest. According to the Saipan Times, a newspaper in the Marianas, which was one of the few news organizations to initially cover Makarenko's Dec. 29 arrest by federal agents in Saipan, Makarenko has been implicated in a scheme to illegally export "defense articles" without a license from the US State Department. He participated in the scheme in partnership with another Russian who had been living in Florida's Broward County, and who had helped procure the equipment for export. This co-conspirator had been sentenced to 26 months in prison last June. According to court filings cited by the Saipan Times, the two men allegedly exported items including night-vision rifle scopes, monoculars and ammunition primers between April and November 2013.
NBC and MSNBC Blamed Russia for Using “Sophisticated Microwaves” to Cause “Brain Injuries” in U.S. “Diplomats” in Cuba. The Culprits Were Crickets. Greenwald - NBC News and MSNBC specialize in repeating and disseminating what U.S intelligence officials tell them to say and then calling that servitude “reporting.” Those two networks really are the all-but-official outlets for CIA messaging. And this status has led their brightest on-air stars to broadcast a series of extremely consequential stories that turned out to be humiliatingly wrong.This stenographic and highly jingoistic practice of mindlessly reciting the whispered claims of anonymous “intelligence officials” is what notoriously led the New York Times and other leading U.S. media outlets to deceive the country into believing Dick Cheney and Paul Wolfowitz’s fairy tales about Iraqi WMDs and Jeffrey Goldberg’s tales about Saddam’s alliance with Al Qaeda. Last September – on the symbolically meaningful date of September 11 – NBC and MSNBC breathlessly trumpeted what they regarded as a major exclusive scoop: that Russia is “the main suspect” in what the network called “mysterious attacks” that led to “brain injuries” in U.S. personnel in Cuba.” They put CIA loyalist Ken Dilanian on the air to explain – based, needless to say, on the script given to him by intelligence officials who, as always, are shielded from accountability by them with anonymity – that “sophisticated microwaves or another type of electromagnetic weapon were likely used on the U.S. government workers” and that it was Russia which likely engineered the attack. Watch their dramatic scoop in all of its glory: As this discussion unfolded, the graphic on MSNBC’s screen was crafted for its most sensationalistic expression: Russia is the “main suspect” in the “brain injury attacks” on American diplomats: That the NBC/MSNBC storyline suffered a major hit this week is a rather dramatic understatement. Two scientists, Alexander Stubbs of Berkeley and Fernando Montealegre-Z of the UK’s University of Lincoln have published their findings about one key part of the evidence about this incident, under this title: Recording of "sonic attacks" on U.S. diplomats in Cuba spectrally matches the echoing call of a Caribbean cricket.
Sisterhood of spies: Women now hold the top positions at the CIA -- CIA Director Gina Haspel has appointed another woman to the top level of the agency, naming Cynthia "Didi" Rapp as deputy director for analysis, essentially the top analyst in the CIA. The appointment means that the top three directorates of the agency, for operations, analysis and science and technology are now all headed by women.Haspel, the first woman director of the agency, had previously named Elizabeth Kimber, like her a 34-year veteran of the agency, as the first female deputy director for operations, responsible for the agency's worldwide spy network. Kimber and Rapp join Dawn Meyerriecks, the deputy director for science and technology, as the top executives in the agency's traditional power centers.It's the first time all three directorates have been headed by women. The CIA work force is now almost 50 percent women, said a U.S. intelligence official."Didi Rapp brings broad, deep expertise from across the Agency and the Intelligence Community to her new role as the head of our Directorate of Analysis. With her engaging leadership style and reputation for objectivity, Didi will excel in leading our talented analytic cadre," said to Brittany Bramell, CIA director of public affairs.Haspel named Courtney Simmons Elwood as the agency's general counsel and Sonya Holt as director of diversity in the months immediately after assuming the director's job last May. Holt is like Haspel, Rapp and Kimber a 30-year-plus veteran of the agency.
Did CIA Director Gina Haspel run a black site at Guantánamo-— An attorney for the accused architect of the Sept. 11 attacks told a judge in a secret session last year that CIA Director Gina Haspel ran a secret agency outpost at Guantánamo, an apparent reference to a post-9/11 black site, according to a recently declassified transcript. The claim by Rita Radostitz, a lawyer for Khalid Sheik Mohammed, appears in one paragraph of a partially redacted transcript of a secret hearing held at Guantánamo on Nov. 16. Defense lawyers were arguing, in a motion that ultimately failed, that Haspel’s role at the prison precludes the possibility of a fair trial for the men accused of orchestrating the 9/11 attacks who were also held for years in covert CIA prisons. Neither the public nor the accused was allowed to attend the hearing but, following an intelligence review, the Pentagon released portions of its transcript on a war court website. Haspel reportedly ran a CIA black site in Thailand where two terror suspects were waterboarded, probably before her arrival there. The unverified statement that she had a similar assignment at the terror-detention center at the U.S. Navy base at Guantánamo Bay, Cuba, would reveal a never-before disclosed chapter of the spy chief’s clandestine career.
Xi’s Top Trade Official Unexpectedly Attended China-U.S. Talks -- Chinese Vice Premier Liu He unexpectedly attended the first day of talks aimed at resolving the trade dispute between the world’s two biggest economies, according to people familiar with the matter and a photo seen by Bloomberg. Liu is the top economic adviser to Chinese President Xi Jinping, who led previous negotiations in Washington that produced a deal that President Donald Trump then repudiated. China had previously said the talks would be led by a lower-ranking official from the Ministry of Commerce. It’s unclear how long Liu stayed, or what he discussed. The Ministry of Commerce didn’t immediately respond to a fax seeking comment on Liu’s appearance. U.S. Trade Representative Robert Lighthizer is expected to meet with Liu later this month, a person familiar with the situation said last week. Liu’s participation in the meeting, held at the ministry’s premises, signals that China is attaching high importance to the talks, even if the main participants this time are mid-level officials. While markets have rallied the past few sessions, a wider downturn over the past month and a deepening economic slowdown are increasing pressure for a deal. The talks are the first face-to-face interactions between the U.S. and China since both presidents met in Argentina and agreed a temporary truce in their tit-for-tat tariff war. More senior-level discussions are expected later this month, with the South China Morning Post reporting that Trump and Chinese Vice President Wang Qishan may meet at the World Economic Forum in Davos, Switzerland.
US-China trade talks: Beijing makes ‘stern complaints’ over American warship in disputed waters - China urged the US to ensure good conditions for progress in trade talks that began Monday in Beijing, complaining over the sighting of a US warship in what it said were Chinese waters. Foreign Ministry spokesman Lu Kang confirmed on Monday during a routine briefing that the talks had begun. Officials at the American Embassy and China's Ministry of Commerce provided no details on the meeting. Both sides have expressed optimism over the potential for progress in settling their tariff fight over Beijing's technology ambitions. Yet neither has indicated its stance has changed since a 1 December agreement by Presidents Donald Trump and Xi Jinping to postpone further increases. The Foreign Ministry said Chinese military aircraft and naval vessels were dispatched to identify the US vessel and warn it to leave the area near disputed islands in the South China Sea. “We have made stern complaints with the US,” Mr Lu said. He said the warship, which he said was the destroyer the USS McCampbell, had violated Chinese and international law, infringed on Chinese sovereignty and undermined peace and stability. “As for whether this move has any impact to the ongoing China-US trade consultations... to properly resolve existing issues of all kinds between China and the US is good for the two countries and the world,” Mr Lu said He added, “The two sides both have responsibility to create necessary and good atmosphere to this end.”
Wilbur Ross: Trade War Is Hurting China More Than US - Contrary to claims made Monday by the pro-Communist Global Times, Commerce Secretary Wilbur Ross said Monday during an interview on CNBC that President Trump's trade war is hurting China more than it is hurting the US - implying that Beijing will relent and strike a trade deal with the US.Ross claimed that US tariffs are impairing China's ability to "create jobs" and "stave off social unrest." Because China exports far more to the US than the US does to China, Beijing is facing a "binary decision", and it's finding out just how much it depends on the US. He added that the talks are happening at an "appropriate level," and that the US delegation is large because of the number of issues that must be addressed, including eventual enforcement and compliance. "What will come out of it is a resolution: Will we go the negotiated rout or will we go in the direction of more tariffs."Ross said the sanctions against ZTE - which nearly destroyed the Chinese telecoms giant - helped demonstrate to China just how badly it needs the US.Already, companies are moving manufacturing out of China, Ross said. Though it's not all coming to the US, Ross said much of it is moving to other Asian countries. In a sign that China is taking the negotiations seriously, top Chinese trade official Liu He unexpectedly made an appearance at the trade talks in Beijing that began on Monday. The "mid-level" talks are intended to lay the groundwork for negotiations: Breakthroughs aren't expected until at least next week, when a delegation led by Trade Rep. Robert Lighthizer is expected to meet with a delegation led by Liu in the first round of "high-level" talks.
U.S. Says China Willing to Buy More American as Trade Talks End- The Trump administration wrapped up the latest round of trade talks in Beijing, noting a commitment by China to buy more U.S. agricultural goods, energy and manufactured items. China and the U.S. concluded three days of talks on Wednesday with a cautious sense of optimism that the world’s two biggest economies might be able to reach a deal that ends their bruising trade war. In a statement, the office of U.S. Trade Representative Robert Lighthizer said the two sides considered ways to “achieve fairness, reciprocity, and balance in trade relations.” Officials discussed the need for any deal to include “ongoing verification and effective enforcement,” USTR said. The U.S. will decide on the next steps after officials report back to Washington. President Donald Trump and President Xi Jinping have given their officials until March 1 to reach an accord on “structural changes” to China’s economy on issues such as the forced transfer of American technology, intellectual-property rights, and non-tariff barriers. The USTR statement didn’t say whether progress had been achieved on its main concerns. People familiar with the discussions said positions were closer on areas including energy and agriculture but further apart on harder issues. China was believed to be preparing its own separate statement on the talks.
US-China trade talks extended to third day amid hopes of deal - Face-to-face trade negotiations between China and the United States have been extended to an unscheduled third day amid hopes that the world's two largest economies can reach a deal to avoid an all-out confrontation.This week's meetings in Beijing are the first direct talks since Chinese President Xi Jinping and his US counterpart, Donald Trump, agreed in December to a 90-day ceasefire in a trade war which has seen the two sides raise import tariffs on each other's goods and has roiled global financial markets.Experts say it will take months for the world's two largest economies to resolve the causes of the dispute, which include disagreements over Beijing's handling of technology and intellectual property.Asian stocks markets on Wednesday rose after the extension of the talks, which began on Monday, generating optimism over a potential trade agreement.Speaking to reporters, Ted McKinney, US undersecretary of agriculture for trade and foreign agricultural affairs, said Washington's delegation in the Chinese capital was "wrapping up" meetings with Chinese officials and would return home later on Wednesday after a "good few days"."I think they went just fine," McKinney said of the talks. "It's been a good one for us," he said without elaborating. The comments came amid signs of progress on issues including purchases of US farm and energy commodities and increased access to China's markets.
No Major Breakthroughs - US Issues Statement On Disappointing Trade Meeting In Beijing - The long-anticipated statement from the US Trade Representative on the just concluded 3 days of talks in Beijing has been released and it appears to be another "nothingburger": In readout of China talks, USTR says officials discussed the need for any agreement w/ China to provide for "complete implementation subject to ongoing verification and effective enforcement." pic.twitter.com/GznRcNJSdz — Alan Rappeport (@arappeport) January 9, 2019In the brief, sub-200 word statement, the USTR says that US and China negotiators discussed ways to achieve "fairness, reciprocity and balance in trade relations"; additionally, the talks also "focused on China's pledge to purchase a substantial amount of agricultural, energy, manufactured goods, and other products and services from the United States" - something that is hardly news - while the two sides also discussed "the need for any agreement to provide for complete implementation subject to ongoing verification and effective enforcement." In other words, absolutely no formal agreements or commitments and just more hot air, which begs the question: what was the point of this meeting if it achieved nothing in terms of trade, but then we look at the market's response which is up 5% in four days on "trade deal optimism" and suddenly it all becomes clear. As noted earlier, today's statement on the concluded 3 days of trade talks in Beijing confirmed that the event was a nothinburger, with the WSJ noting that the two sides made "progress toward an agreement but leaving the thorniest issues to be resolved in higher-level talks, according to people with knowledge of the discussions." During three days of talks between midlevel trade officials from Washington and Beijing in the Chinese capital that ended Wednesday, the two sides made progress on issues such as additional Chinese purchases of U.S. goods and services, as well as opening China’s markets further to American capital, the people said. But they cautioned that the two teams hadn’t yet made a breakthrough and more discussions are needed to resolve a trade fight that has unnerved global markets. Meanwhile, the two sides remain divided on knottier issues including a reduction of Chinese subsidies to domestic firms and protection of intellectual property, and a resolution still needs to be hammered out. The U.S. delegation, led by Deputy U.S. Trade Representative Jeffrey Gerrish, left Beijing late Wednesday afternoon. Here is the full "Statement on the United States Trade Delegation's Meetings in Beijing"
No deal reached in US-China trade talks - Three days of talks in Beijing between US and Chinese negotiators broke up yesterday without a deal being struck to end the escalating trade war between the countries. Further talks are scheduled in Washington ahead of the March 1 deadline set by the Trump administration.The US threat to raise tariffs on $200 billion worth of Chinese goods from 10 to 25 percent, if no resolution is reached, underscores the one-sided and bullying character of Washington’s approach to the talks. The “negotiations” consisted of US officials insisting that Beijing meet a long list of demands, but offering nothing in return, other than not proceeding with the higher tariffs.In a statement issued yesterday, the Office of the US Trade Representative declared that US negotiators had “conveyed President Trump’s commitment to addressing our persistent trade deficit [with China] and to resolving structural issues in order to improve trade between our countries.”The statement noted that China had pledged to buy a “substantial amount” of US agricultural, manufacturing, energy and other products, but made clear that any deal would be “subject to ongoing verification and effective enforcement.” In other words, the onus is on China to demonstrate that it will meet US demands, with the threat of additional penalties in the background.The New York Times noted that the US intends to maintain its tariffs placed on Chinese goods last year. “Treasury would preserve indefinitely the 25 percent tariffs that Mr. Trump imposed in July and August on $50 billion a year in Chinese goods, or roughly a tenth of American imports, and the 10 percent tariffs that he imposed in September on an additional $200 billion in Chinese goods,” it reported. The so-called “structural issues” are not about “fair trade,” but reflect fears in Washington that China is a threat to US ambitions for global domination. Trump and his officials have repeatedly accused Beijing of the “theft” of American intellectual property and of forcing US corporations to transfer technology to their Chinese partners as the price of doing business in China.
China Turns to Russia in Search to Replace U.S. Soybeans - In the search to replace U.S. soybeans, China is turning to Russia. Russia plans to increase production of soybeans in the Far East for deliveries to China, Prime Minister Dmitry Medvedev told reporters in Beijing. The two countries are also planning to work more closely on other agriculture products, including rice, pork, poultry, fish, and to develop logistics. While Russia is a tiny supplier of soybeans, the move shows one of the effects of the U.S. trade war is closer Chinese and Russian ties. China has also been looking to diversify its sources of food as part of a broader Belt and Road initiative that’s backed by hundreds of billions of dollars for infrastructure projects. “We can expect an increase in exports from Russia to China, but it will not skyrocket,” said Laurent Crastre, an oilseed analyst with French agriculture consultancy Strategie Grains. “It will be one more option they will have to source soybeans.”
White House to Roll Out Bill to Expand Trump’s Tariff Powers, Sources Say -- President Donald Trump is expected to urge Congress in his State of the Union address this month to pass new legislation that would expand his powers to break down non-tariff barriers to American exports, according to people familiar with the plan. The bill, crafted by White House trade adviser Peter Navarro’s office along with the Trade Representative’s office and the Commerce Department, would seek to give the president broad authority to increase U.S. tariffs if he considers other countries’ tariff and non-tariff measures to be too restrictive, a person briefed on the legislation said. The White House has been working on the initiative, known as the U.S. Reciprocal Trade Act, with a few House Republicans, the person said. The proposal to give Trump more authority to raise duties without congressional approval comes after failed attempts by Republican senators to rein in his trade and tariff powers. The White House last year applied rarely used legal provisions to skirt Congress and slap tariffs on Chinese goods as well as steel and aluminum from most U.S. trading partners. It’s unclear whether the White House bill will succeed, one of the people said, adding that while some Democrats are ideologically in favor of cracking down on unfair trade practices, they are unlikely to give Trump additional executive power. Democrats won control of the House in November’s midterm elections. The legislation is part of the Trump administration’s strategy to further open foreign markets for American companies, many of whom have long complained that so-called non-tariff barriers abroad such as local customs and regulatory laws restrict their exports. Addressing non-tariff barriers is an important priority for the president, the people familiar with the legislation said.
Reuters Exposes Huawei's Deep Ties To Iran And Syria - Reuters reporters have been covering Huawei's business dealings in Iran for years, with reports about Huawei's illegal sales of US-made equipment to an Iranian telecoms firm dating back to 2012. Some of these reports have been cited in the US case against Huawei CFO Meng Wanzhou, who was arrested in Canada on Dec. 1 on allegations she knowingly misled banks about Huawei's relationship with its Hong Kong-based "partner" Skycom, which Reuters exposed for facilitating sales to Iranian companies in violation of US sanctions. And in its latest report on Huawei's dealings in the Islamic Republic, Reuters examined corporate filings and other documents in Iran and Syria which proved that Huawei's relationship with Skycom and another firm - Syria-based shell company Canicula Holdings - is even deeper than had previously been reported. These revelations show that Huawei's business dealings in both countries are even more extensive than previously believed. The filings cited by Reuters revealed that a senior Huawei executive named Shi Yaohong was also the Iranian manager at Skycom (before the company, recently exposed as a fully-owned subsidiary of Huawei, was dissolved). They also revealed that three individuals with Chinese names had signing rights for bank accounts tied to both Huawei and Skycom. The documents reveal that a high-level Huawei executive appears to have been appointed Skycom’s Iran manager. They also show that at least three Chinese-named individuals had signing rights for both Huawei and Skycom bank accounts in Iran. Reuters also discovered that a Middle Eastern lawyer said Huawei conducted operations in Syria through Canicula. The previously unreported ties between Huawei and the two companies could bear on the U.S. case against Meng, who is the daughter of Huawei founder Ren Zhengfei, by further undermining Huawei’s claims that Skycom was merely an arms-length business partner. But despite the company's efforts to portray its operations in Iran as a past transgression, Reuters report suggests that Huawei is still operating in Syria and Iran. Like Iran, Syria is another country impacted by US and EU sanctions, and its also home to a Huawei subsidiary that does business with Syrian telecoms firms.
Chinese tech investors flee Silicon Valley as Trump tightens scrutiny (Reuters) - New Trump administration policies aimed at curbing China’s access to American innovation have all but halted Chinese investment in U.S. technology startups, as both investors and startup founders abandon deals amid scrutiny from Washington. Chinese venture funding in U.S. startups crested to a record $3 billion last year, according to New York economic research firm Rhodium Group, spurred by a rush of investors and tech companies scrambling to complete deals before a new regulatory regime was approved in August. Since then, Chinese venture funding in U.S. startups has slowed to a trickle, Reuters interviews with more than 35 industry players show. U.S. President Donald Trump signed new legislation expanding the government’s ability to block foreign investment in U.S. companies, regardless of the investor’s country of origin. But Trump has been particularly vocal about stopping China from getting its hands on strategic U.S. technologies. The new rules are still being finalized, but tech industry veterans said the fallout has been swift. “Deals involving Chinese companies and Chinese buyers and Chinese investors have virtually stopped,” said attorney Nell O’Donnell, who has represented U.S. tech companies in transactions with foreign buyers. Lawyers who spoke to Reuters say they are feverishly rewriting deal terms to help ensure investments get the stamp of approval from Washington. Chinese investors, including big family offices, have walked away from transactions and stopped taking meetings with U.S. startups. Some entrepreneurs, meanwhile, are eschewing Chinese money, fearful of lengthy government reviews that could sap their resources and momentum in an arena where speed to market is critical. Volley Labs, Inc, a San Francisco-based company that uses artificial intelligence to build corporate training materials, is playing it safe. It declined offers from Chinese investors last year after accepting cash from Beijing-based TAL Education Group (TAL.N) as part of a financing round in 2017. “We decided for optical reasons it just wouldn’t make sense to expose ourselves further to investors coming from a country where there is now so much by way of trade tensions and IP tensions,” said Carson Kahn, Volley’s CEO. A Silicon Valley venture capitalist told Reuters he is aware of at least ten deals, some involving companies in his own portfolio, that fell apart because they would need approval from the interagency group known as the Committee on Foreign Investment in the United States (CFIUS). He declined to be named for fear of bringing negative attention to his portfolio companies.
Curbs on A.I. Exports? Silicon Valley Fears Losing Its Edge - NYT— A common belief among tech industry insiders is that Silicon Valley has dominated the internet because much of the worldwide network was designed and built by Americans. Now a growing number of those insiders are worried that proposed export restrictions could short-circuit the pre-eminence of American companies in the next big thing to hit their industry, artificial intelligence. In November, the Commerce Department released a list of technologies, including artificial intelligence, that are under consideration for new export rules because of their importance to national security. Technology experts worry that blocking the export of A.I. to other countries, or tying it up in red tape, will help A.I. industries flourish in those nations — China, in particular — and compete with American companies.“The number of cases where exports can be sufficiently controlled are very, very, very small, and the chance of making an error is quite large,” said Jack Clark, head of policy at OpenAI, an artificial intelligence lab in San Francisco. “If this goes wrong, it could do real damage to the A.I. community.” The export controls are being considered as the United States and China engage in a trade war. The Trump administration has been critical of the way China negotiates deals with American companies, often requiring the transfer of technology to Chinese partners as the cost of doing business in the country. And federal officials are making an aggressive argument that China has stolen American technology through hacking and industrial espionage. Tech companies, academics and policymakers are calling on the Commerce Department to take a light hand with A.I. export rules ahead of a Jan. 10 deadline for public comment. Their argument has three main points: Restrictions could harm companies in the United States and help international competitors. They could stifle technology improvements. And they may not make much of a difference.
Trump administration downgrades EU mission to US - The Trump administration has downgraded the diplomatic status of the European Union's delegation to the United States, an EU official has confirmed to DW. The demotion happened at the end of last year without notice. The unannounced move by the US State Department, which has not previously been reported, downgraded the EU delegation's diplomatic status in Washington from member state to international organization. "We don't exactly know when they did it, because they conveniently forgot to notify us," an EU official who is familiar with the matter told DW in an interview. "I can confirm that this has not been well received in Brussels," the person said, adding that the issue and an official EU response was still being discussed. Meanwhile EU officials in Brussels said on Tuesday that per protocol, the diplomatic rank of David O'Sullivan, the EU's ambassador to Washington, had been reinstated. After the delegation noticed that the EU's Washington ambassador had not been invited to certain events late last year, officials organizing the state funeral for President George H.W. Bush provided final confirmation to EU diplomats that the status of the representation had in fact been downgraded. Diplomats believe the downgrade must have been implemented in late October or early November. At the high-profile event on December 5, as diplomats gathered in Washington to pay their respects, O'Sullivan, was not called up in the usual chronological order from the longest-serving to the newest ambassador, said the EU official. "But he was called up as the last person." Prior to the demotion, O'Sullivan — who has served as the EU's ambassador to Washington since 2014 — would have been ranked among the first 20 or 30 ambassadors of the more than 150 foreign representatives dispatched to the US capital.
Covert British Military-Smear Machine Moving Into US - After mobilizing a disinformation campaign across Europe, documents show that the Integrity Initiative is now infiltrating the US...A bombshell domestic spy scandal has been unfolding in Britain, after hacked internal communications exposed a covert U.K. state military-intelligence psychological warfare operation targeting its own citizens and political figures in allied NATO countries under the cover of fighting “Russian disinformation.” The leaked documents revealed a secret network of spies, prominent journalists and think-tanks colluding under the umbrella of a group called “Integrity Initiative” to shape domestic opinion—and to smear political opponents of the right-wing Tory government, including the leader of the opposition Labour Party, Jeremy Corbin.Until now, this Integrity Initiative domestic spy scandal has been ignored in the American media, perhaps because it has mostly involved British names. But it is clear that the influence operation has already been activated in the U.S.. Hacked documents reveal that the Integrity Initiative is cultivating powerful allies inside the State Department, top D.C. think tanks, the FBI and the Department of Homeland Security, where it has gained access to Katharine Gorka and her husband, the fascist-linked cable news pundit Sebastian Gorka. The Integrity Initiative has spelled out plans to expand its network across the U.S., meddling in American politics and recruiting “a new generation of Russia watchers” behind the false guise of a non-partisan charity. Moreover, the group has hired one of the most notorious American “perception management” specialists, John Rendon, to train its clusters of pundits and cultivate relationships with the media.
Twenty-two deaths reported in immigrant detention centers since Trump took office - At least 22 immigrants have died in the custody of Immigration and Customs Enforcement (ICE) since Donald Trump took office in January of 2017, according to a review of Department of Homeland Security (DHS) documents by NBC News. The deaths come as the Trump administration has escalated the assault on immigrants in the United States, increasing the number of people held in its sprawling network of some 200 jails and detention camps to 42,000 per day in 2018. Under Trump the population of the immigrant prison network has risen 30 percent over the average under Obama and twice that under George W. Bush, filling many jails to capacity. The rapidly rising number of immigrants held in federal custody has contributed to the recent rise in deaths. Despite this, the administration has requested that the capacity be expanded to 51,000 as it continues its anti-immigrant rampage in 2019. Reports of unsanitary conditions, spoiled food, abusive guards and lack of medical staff are common. Detainees are treated like convicted criminals and are frequently placed in solitary confinement regardless of their age or health. A report published by Human Rights Watch last year found that “dangerously substandard care in immigration detention” contributed to the deaths of 15 people in ICE custody between December 2015 and April 2017. “You'll see someone who is clearly an asylum seeker who came into custody with a serious medical condition, whether a heart condition or otherwise, and you have to ask, ‘Why is this person in jail?’” Ten deaths were recorded in 2017 and the 12 reported in 2018 matched the number of migrants who died in 2016, the last full year of the Obama administration. In total there have been 188 deaths in immigration detention centers since 2003 when DHS began to oversee the operation of ICE and Customs and Border Protection (CBP).
Trump Planning To Ease Immigration Restrictions On Skilled Workers As Wall Battle Rages - Policy wonks in pro-business think tanks across Washington probably wet their pants Friday morning when President Trump hinted that an immigration policy that many of them have long advocated for could soon become a reality.In a tweet, Trump said changes are coming to US immigration policy that would simplify the application process and clear a "pathway to citizenship" for H1-B visa holders - a cohort of workers, including doctors and software engineers, who are highly educated and work in highly specialized industries. Trump has long claimed that he wants a larger share of immigrants coming to the US to consist of skilled workers. And by making it easier for skilled workers to stay and settle in the US, he can simultaneously placate Democrats and pro-business Republicans. Health-care advocates have long complained that the H1-B visa program should be reformed to make it easier for more doctors to come to - and stay in - the US. Silicon Valley firms have long hired engineers from abroad and groaned when visa issues made it difficult for them to stay. Should Trump follow through on this promise, it could also strengthen the president's position in the border wall debate by making it more difficult for Trump's opponents to paint him as irrationally opposed to immigration in a blanket sense.
Evangelical group calls for LGBT people to be removed from anti-lynching bill - An evangelical nonprofit is asking lawmakers to remove language from a federal anti-lynching bill that protects Americans on the basis of sexual orientation and gender identity before the legislation becomes law. NBC News reported Wednesday that the nonprofit group, Liberty Counsel, which is designated as a "hate group" by the Southern Poverty Law Center, is lobbying members of the House to remove language referring to "sexual orientation" and "gender identity" in the bill, which passed the Senate unanimously last month. "The old saying is once that camel gets the nose in the tent, you can't stop them from coming the rest of the way in," Mat Staver, the group's chairman, told conservative news outlet, OneNewsNow, according to NBC. “This is a way to slip it in under a so-called anti-lynching bill, and to then to sort of circle the wagon and then go for the [jugular] at some time in the future," he reportedly added. Liberty Counsel did not immediately respond to NBC News' request for comment. The bill, introduced by Sens. Kamala Harris (D-Calif.), Cory Booker (D-N.J.) and Tim Scott (R-S.C.), makes lynching punishable as a hate crime. Thirty-five other senators formally co-sponsored the bill, which was introduced in July and cleared the Judiciary Committee unanimously in October. It passed the full Senate by voice vote.
Record Numbers of Americans Want to Leave the U.S – Gallup - While Donald Trump has spent much of his presidency focused on the number of people who want to get into the U.S., since he took office, record numbers of Americans have wanted to get out. Though relatively average by global standards, the 16% of Americans overall who said in 2017 and again in 2018 that they would like to permanently move to another country -- if they could -- is higher than the average levels during either the George W. Bush (11%) or Barack Obama administration (10%). Ideally, if you had the opportunity, would you like to move PERMANENTLY to another country, or would you prefer to continue living in this country? While Gallup's World Poll does not ask people about their political leanings, most of the recent surge in Americans' desire to migrate has come among groups that typically lean Democratic and that have disapproved of Trump's job performance so far in his presidency: women, young Americans and people in lower-income groups. During the first two years of the Trump administration, a record-high one in five U.S. women (20%) said they would like to move to another country permanently if they could. This is twice the average for women during the Obama (10%) or Bush years (11%) and almost twice the level among men (13%) under Trump. Before the Trump years, there was no difference between men's and women's desires to move. The 30% of Americans younger than 30 who would like to move also represents a new high -- and it is also the group in which the gender gap is the largest. Forty percent of women younger than 30 said they would like to move, compared with 20% of men in this age group. Desire to migrate among the poorest 20% of Americans during Trump's first two years is also at record levels. It is more than twice as high as the average during Obama's two terms. So far under Trump, three in 10 Americans (30%) in the poorest 20% say they would like to migrate if they could, compared with an average of 13% under Obama.
“Trump Effect”: Record Number of Americans Want to Leave the Country — While most Americans still want to stay put, the number of U.S. citizens—particularly young women—who would leave the country if they could has increased dramatically under President Donald Trump, according to new Gallup polling results.Released Friday as part of the Gallup World’s Poll, the survey found that while only 11 percent and 10 ten percent wanted to leave the county under former presidents George W. Bush and Barack Obama, respectively, that number surged to 16 percent in 2018 under Trump. While the survey, explained Gallup, “does not ask people about their political leanings, most of the recent surge in Americans’ desire to migrate has come among groups that typically lean Democratic and that have disapproved of Trump’s job performance so far in his presidency: women, young Americans and people in lower-income groups.”
Biggest Threat to Single-Payer- Democrat Support for a Public Option - With the midterms over, a battle over health care policy among establishment Democrats and the grassroots is unfolding. What kind of health care reform should Democrats pursue now that they have won control of the House? This struggle will determine in large part how Democrats will spend the political capital the party has accumulated on the issue of health care. This is a considerable amount thanks to the GOP’s efforts to take health care away from millions and ongoing war against Medicaid. How this battle transpires over the next two years may go a long way in determining if Medicare for All can become policy, or simply remains a “goal” or an “aspiration.” Single-payer advocates, jubilant about record support in Congress and in public polls, have responded to the midterm success by boldly pushing for a floor vote on Medicare for All (H.R. 676) during the 116th Congress. This move would not result in a law as it has no chance in the Senate. It would, however, represent a huge symbolic victory and, ideally, plant HR 676 as the centerpiece of the Democratic Party’s health care platform. Much of the work that is being planned by major players in the movement was discussed in a post-midterm strategy call hosted by National Nurses United and attended by Sen. Bernie Sanders, Rep. Pramila Jayapal and speakers from Healthcare-NOW!, Physicians for a National Health Program and Democratic Socialists of America. In the call, Sanders warned of the opposition from “Trump and his minions” and the private health industry. But of all the speakers, only one, Dr. Adam Gaffney, president of Physicians for a National Health Program (PNHP), warned of the dangers posed by Democrats and the threat of “a slew of half-measures.”
Should Institutional Providers Be Incentivized by Profit under Medicare for All? --Lambert Strether -I’ve avoided writing about hospitals and other institutions, because my focus has always been on the patient, and whether they get, or don’t get, health care under our horrid mixed system of Medicaid, private insurance, and Medicare (subject to a neoliberal infestation though it may be). However, as Medicare for All approaches the reality of House hearings and alternatives emerge to HR676 and S1804, the two bills now on the table, a greater focus on institutions beyond the health insurance industry becomes inescapable. One key difference between health care institututions is whether they are profit or non-profit (caveating that a non-profit institution can be profit-making in all but name). As Naked Capitalism readers know, on difference between HR676 and S1804, is that the latter bill, sponsored by Senator Bernie Sanders, allows investor-owned entities to be reimbursed for services delivered, like today’s Medicare. The House bill, by contrast, does not. Since it’s likely that a combination of ideology, donor class “speech,” Congressional sausage-making, and liberal Democrat duplicity will bias the process toward investors, it’s worth asking whether we should incentivize institutional providers with profit, or not. Incentives matter, after all! I think doing so is bad idea, for three reasons: (1) Profiteering inflates costs; (2) Profiteering increases patient mortality; and (3) The goal of a health care system should be health care, not profit. (Note that, politically, this means opposing Sanders as, in essence, too much of a moderate). I will take up these points in order, but first let me give more details on payment systems proposed by the two bills we do have (since we have not seen how Representative Pramila Jayapal will rewrite HR676). From Stephanie Woolhandler and David Himmelstein in Health Affairs:
Senators Call on FCC To Investigate T-Mobile, AT&T, and Sprint Selling Location Data to Bounty Hunters - On Tuesday, Motherboard revealed that major American telcos T-Mobile, AT&T, and Sprint are selling customer location data of users in an unregulated market that trickles down to bounty hunters and people not authorized to handle such information. In our investigation, we purchased the real-time location of a cell phone from a bail industry source for $300, pinpointing it to a specific part of Queens, New York. Now, Senators and a commissioner for the Federal Communications Commission (FCC) have urged government bodies to investigate, with some calling for regulation that would ensure customers are properly made aware of how their data is being sold.
Justice Ginsburg is Probably Quite Ill, Physician Cautions - According to Kathleen Arberg, public information officer for the Supreme Court: “Two nodules in the lower lobe of her left lung were discovered incidentally during tests performed at George Washington University Hospital to diagnose and treat rib fractures sustained in a fall on November 7. [2018]” According to the surgeon who operated on the justice, Dr. Valerie Rusch, both nodules removed during surgery were found to be malignant. However, “post-surgery, there was no evidence of any remaining disease. Scans performed before surgery indicated no evidence of disease elsewhere in the body. Currently, no further treatment is planned.” Thus, from published reports from reputable sources, we know the following:
1. She had non-metastatic colon cancer removed in 1999
2. She had non-metastatic pancreatic cancer removed in 2010.
3. She had a stent placed in her coronary arteries in 2014
4. She fell in November of 2018 and broke three ribs.
5. She had surgery in December of 2018 and had two malignant nodules removed from her lungs.
6. Scans found no other cancer in her body.
7. She is 85 years old and has no history of being a smoker.
The most significant words from above are “two malignant nodules.” What does this mean?First of all, malignant nodules are fancy words for small tumors, in general one that is about an inch or smaller in size. When a nodule is removed during surgery, it is quickly examined under the microscope by a pathologist. These doctors rarely see patients; rather they examine tissues and determine the cause of disease. Pathologists can usually determine quickly whether a nodule is benign or malignant, but in order to determine the actually type of cancer (that is the tissue source of the cancer), special preparation is required before microscopic examination. This can take several days or weeks to complete. At the time of this writing, we have no published reports stating the results of these tests – or even if they were ever done. But since there were “two malignant nodules,” the odds are is that this is Stage IV or metastatic cancer – meaning that it has spread to the lungs from another organ system. Even with today’s modern technology, it is difficult to pinpoint small primary tumors. Otherwise we would be screening everyone to catch cancer earlier when it is easier to cure.
Ruth Bader Ginsburg will miss arguments for second week, but no further treatments planned - Supreme Court Justice Ruth Bader Ginsburg will miss a second week of oral arguments as she continues to recover from cancer surgery she underwent last month, court spokeswoman Kathy Arberg said Friday.But Ginsburg's recovery is on track, there is no evidence of remaining cancer in her body and no further treatment is planned. Ginsburg will continue to participate in the cases on the basis of the briefs and transcripts of oral arguments."Her recovery from surgery is on track," Arberg said. "Post-surgery evaluation indicates no evidence of remaining disease, and no further treatment is required." Ginsburg underwent an operation on Dec. 21 to remove two cancerous growths from her left lung. Friday marks three weeks since the surgery. Ginsburg, the court's eldest justice, will turn 86 in March. The court had provided no guidance on when Ginsburg would return to the bench. Her absence Monday marked the first time in her more than 25 years on the high court that she was not present for arguments. Cancer experts have said that a typical recovery period for the type of minimally invasive pulmonary lobectomy the justice received is about four to six weeks. After next week, the court will not meet again for arguments until Feb. 19.Ginsburg's health has been a matter of intense public concern because of the political balance of the court. The nine-justice panel is currently divided 5-4 among Republican and Democratic appointees. Ginsburg's retirement from the court would likely enable PresidentDonald Trump to name Ginsburg's successor, solidifying its conservative majority. It would mark the first time that Trump replaced a justice appointed by a Democrat.
Trump got Vietnam War exemption from doctors as a favor, New York Times reports – CBS video - A New York Times investigation is bringing President Trump's past back into light. The report uncovered evidence that two doctors from Queens, New York, helped Mr. Trump dodge the Vietnam War in 1968. Reporter Steve Eder joined CBSN to discuss what he found in the investigation and what it means for the president.
Rashida Tlaib ‘Removes’ Israel From the Map in Her Congressional Office — Rashida Tlaib, the first Palestinian congresswoman, made a change to the map of her congressional office in Washington, DC, replacing Israel with Palestine.Someone has already made a slight alteration to the map that hangs in Rashida Tlaib’s new congressional office. pic.twitter.com/mwyshIog4r— Hannah Allam (@HannahAllam) January 3, 2019In an interview with the congresswoman, after her swearing-in last Thursday, Tlaib said: “And when your son looks at you and says, ‘Momma, look, you won. Bullies don’t win.’ And I say, ‘Baby, they don’t.’ Because we’re gonna go in there and we’re gonna impeach the mother***er,” in reference to Trump, who replied: “How can you begin with impeaching a president who may have won the greatest elections in the US history, made no mistake, and scored the best performance in the first two years compared to all other presidents?”I used my own *personal Quran* that my best friend of 25 years gifted me to use for the ceremonial swear in (basically a photo with Speaker Pelosi).*Note: I did not use Jefferson's Quran as reported. I wanted it to be more personal (and my own).pic.twitter.com/DRTn3EuB8y— Rashida Tlaib (@RashidaTlaib) January 6, 2019
Dems livid after Tlaib vows to ‘impeach the motherf—er’ - House Democrats are furious that an incoming freshman’s expletive-riddled statement about impeaching Donald Trump has suddenly upended their carefully crafted rhetoric on their plans to take on the president. Speaker Nancy Pelosi and other top Democrats have long argued that impeachment is a last resort that would come at the end of exhaustive oversight and investigations. But on the second day of the new Congress, the news was jammed with talk of Rep. Rashida Tlaib of Michigan, who told a crowd of progressive activists Thursday night that “we’re gonna impeach the motherf---er.” ..Rank-and-file Democrats, immediately fearful of the damage the comment could cause, unloaded on their new colleague Friday morning. Republicans, they argued, would hold it up as proof that Democrats are playing politics rather than pursuing genuine oversight of the president — even if the GOP never showed interest in investigating Trump scandals while it was in power. “Mueller hasn’t even produced his report yet!” said Rep. Ron Kind (D-Wis.), referring to special counsel Robert Mueller’s Russia probe. “People should cool their jets a little bit, let the prosecutors do their job and finish the investigation.” “Inappropriate,” added Rep. Jim Costa (D-Calif.). “As elected officials I think we should be expected to set a high bar… It’s not helpful.”
Progressives Fought for Key Committee Spots, but Centrist New Dems Came Out on Top - Rep. Alexandria Ocasio-Cortez failed in her long-shot bid for a seat on the powerful Ways and Means Committee, according to an announcement from House Speaker Nancy Pelosi Wednesday evening. Pelosi named a member of the New Democrat Coalition, the centrist wing of the party, to the seat instead, part of a sweeping set of wins by the Wall Street-friendly caucus. However, Ocasio-Cortez is in line to get a solid consolation prize — a seat on the House Financial Services Committee, with jurisdiction over Wall Street. Sources close to the process said that it is also likely that Progressive Caucus member Katie Porter, D-Calif., a financial services expert, will get tapped for the committee, and that Rashida Tlaib, D-Mich., and Ayanna Pressley, D-Mass., are in the running. This would put a strong bloc of progressives on an important committee headed by Rep. Maxine Waters of California. Democrats have struggled to find many members to serve on Financial Services, leading to speculation that the party would actually shrink the size of the committee. Alternatively, that quandary could result in progressives being added as a last resort. The imminent Financial Services Committee announcement would take some sting out of several disappointments for the Congressional Progressive Caucus’s high-profile rising stars, who on Wednesday were largely shut out of new assignments to three critical committees where they sought expanded representation.
Alexandria Ocasio-Cortez hits out at 'disgusting' media publishing fake nude image - Alexandria Ocasio-Cortez, the rapidly rising star of the Democratic party, has lashed out at conservative media for its treatment of women in leadership positions after the Daily Caller published a fake photo of the politician nude in a bath-tub. The rightwing website published the image showing a woman’s bare feet in the bath, under the headline: “Here’s the photo some people described as a nude selfie of Alexandria Ocasio-Cortez”. In fact, the photograph had been circulating on the internet already for a month and has been shown to have been falsely ascribed to the politician by a user on a Reddit forum. Ocasio-Cortez wrote on Twitter that the use of a discredited image by a prominent conservative outlet showed that “women in leadership face more scrutiny. Period.” She said the actions of the Daily Caller were “just a matter of time” given that Republicans had been “frothing at the mouth all week” – a phrase that she did not explain. She also criticized the Daily Mail which she accused of sending a reporter “to my boyfriend’s relative’s homes” offering them cash for “stories”.
Court: Politicians who block citizens on social media violate 1st Amendment - Politicians’ social media pages can be 1st Amendment forums, judge says - A federal appeals court in Virginia ruled unanimously Monday that a county official who blocked a citizen from accessing her official Facebook page is in violation of the First Amendment. The case—which was heard before the 4th US Circuit Court of Appeals—found that Phyllis Randall, the chair of the Loudoun County Board of Supervisors, improperly blocked a man named Brian Davison on Facebook for 12 hours back in February 2016.During one town hall meeting involving Randall, Davison had suggested that some financial improprieties were afoot. Within hours, Davison left a lengthy Facebook post on Randall's page, and she banned him. The next day, she reversed course and unbanned him, but his post remained deleted. Not long after, Davison sued, alleging violations of his constitutional rights, and he eventually won at trial. The county chair then appealed to the 4th Circuit, which ultimately ruled that Randall's Facebook page "bear[s] the hallmarks of a public forum," where public speech—however undesirable—cannot be discriminated against. Before the 4th Circuit, Davison was represented by lawyers at the Knight First Amendment Institute at Columbia University, an organization that is also representing users blocked on Twitter by President Donald Trump. That case remains on appeal before the 2nd Circuit."The Supreme Court should consider further the reach of the First Amendment in the context of social media," US District Judge Barbara Milano Keenan wrote in a concurrence seeking further guidance in situations related to this one.
A Qualified Defense of the Barr Memo: Part I - Lawfare - Daniel Hemel and Eric Posner have harshly criticized William Barr’s memo on Special Counsel Robert Mueller’s obstruction of justice theory. They say (in the New York Times) that the memo “seriously damages [Barr’s] credibility and raises questions about his fitness for the Justice Department’s top position” and (later, on Lawfare) that the memo is “poorly reasoned.” In my view, Hemel and Posner’s arguments don’t support these conclusions. I’m not going to spend much time on the proper way to parse the words of the obstruction statute, as Barr and the coauthors do. I agree with Marty Lederman that much of this fine-grained analysis is beside the point because Mueller is almost certainly not considering asking a grand jury to indict President Trump for a violation of a criminal law on obstruction of justice. I instead want to focus on a few broader principles of constitutional law and statutory interpretation in Barr’s memo and in Hemel and Posner’s responses. My primary aim is to show that Barr’s views, far from crazy, have significant support in Supreme Court case law and executive branch precedent, and that the real significance of the Barr memorandum may be its possible use in support of the impeachment of President Trump. A later post will address other issues in the Barr memorandum.
Someone Finally Explained the Trump-Russia Story and It Will Make You Question Everything — Aaron Maté is a journalist known for his work as a former host/producer at the Real News, Democracy Now, and producer at Al Jazeera English. He is also a contributor at the Nation, who has recently been dedicating much of his column space to debunking claims that the Trump campaign colluded with the Russian government, more famously known as the “Russiagate” scandal.Maté has become well-known for his fearless and adversarial approach to interviewing guests, especially for his now infamous one-on-one interview with discredited journalist Luke Harding; as well as James Risen, a writer at the Intercept, leading one commentator to describe him as a “beast.” With the Russiagate narrative once again dominating recent headlines, the Mind Unleashed decided to catch up with Maté for a lengthy conversation to get his take on the most recent developments. I have seen you get into a lot of debates on Twitter about the Russiagate narrative. What do you say to someone who firmly believes that there is a great deal of publicly available evidence that the Trump campaign had illicit dealings, or colluded, with the Russian government? Maté: I will start by saying broadly: if you look on the surface, yeah you might think there is something suspicious going on because you have some cases of Trump-associates meeting Russians and you have emails written, like the one from Rob Goldstone, a publicist, that says the Russian government supports Donald Trump. And you know, you can put all these things together and yeah, on the surface you could say that this looks very sketchy and this looks like there was maybe some conspiracy Trump and Russia. The problem though is that, especially if you are a journalist, it’s your job to look at the facts. And in the case of Russiagate we have a lot of facts. We have Court transcripts, we have congressional testimony, there’s been a lot of reporting done. And I think the facts are all pretty clear that at least so far, all the facts, as I see them, undermine the prospects of a conspiracy. As I have also said, and I want to stress this, maybe Mueller will uncover some huge conspiracy but so far, it’s not there.
The Steele Dossier Was Planned As Hillary's Insurance Policy -- It’s been over a year since the highly damaging text messages between FBI agent Peter Strzok and his paramour, FBI lawyer Lisa Page, were revealed to the American public. The correspondence showed two senior Justice Department officials engaged in the most petty, vitriolic political diatribes while making decisions on the most sensitive investigations of the 2016 political season.Their hatred toward then-candidate Donald Trump as well as their contempt for his supporters gave reasonable observers every reason to question whether the Hillary Clinton email investigation and the counterintelligence investigation into alleged Russian influence in the Trump campaign (Mr. Strzok and Ms. Page played key roles in both inquiries) were handled in a fair, unbiased and judicious manner.Their behavior was so egregious that special counsel Robert Mueller removed them from his team the moment Justice Department Inspector General Michael Horowitz told him about the text messages. Mr. Strzok was dismissed from the FBI, and further investigations are continuing.Despite all this, defenders of the James Comey cabal and “Russia collusion” aficionados make one strong argument that seemingly debunks the spygate scandal and outrage over the upper reaches of the Obama administration’s wide-reaching surveillance operation on the campaign of the president’s rival party.“If Comey and Loretta Lynch and Andrew McCabe and Strzok and even Obama did all of this to hurt the Trump campaign, then why didn’t they leak any of it to damage him, and how on earth did he win the election with this kind of dirty trick being played against him?” they argue. “If these guys, with all their power, set out to hurt Trump, they sure did a lousy job.”This argument makes sense (which is why it is employed and repeated by mainstream media journalists and pundits whenever objections to Justice Department behavior in 2016 is raised on cable news) only if the sole intent of the FBI’s action in the summer of 2016 was to harm the Trump campaign.New revelations confirm that this was not the mission of the creators and commissioners of the Steele dossier. It was, instead, to harm Mr. Trump if he won the election.
"The Criminals Who Run The Deep State Will Be Exposed": Kim Dotcom Teases "Next Round Of Leaks" - Hacker and serial entrepreneur Kim Dotcom is out with a new prediction for 2019: "Get ready for the next round of leaks." I smile every day watching the aftermath of preventing Hillary. Deep State exposed. Fake news exposed. DOJ & FBI exposed. I’m happy you are more informed than ever. 2019 will reveal so much more. Get ready for the next round of leaks. Monumental stuff — Kim Dotcom (@KimDotcom) January 5, 2019 Dotcom then tweeted "This year the criminals who run the Deep State will be exposed," adding "The shareholders profiting from war and chaos. The billionaires who turn democracy into an illusion. They own politicians, judges and all your data. They are the biggest pirates in history. Want to know who they are?" This year the criminals who run the Deep State will be exposed. The shareholders profiting from war and chaos. The billionaires who turn democracy into an illusion. They own politicians, judges and all your data. They are the biggest pirates in history. Want to know who they are? — Kim Dotcom (@KimDotcom) January 5, 2019 For those paying attention, Dotcom dropped massive breadcrumbs going all the way back to 2015 regarding the WikiLeaks release of Hillary Clinton's emails during the 2016 US election. And while he's has made headlines for years, in February Dotcom boldly stated that the DNC "hack" which kicked off the Russian election interference narrative was bogus, tweeting: "Let me assure you, the DNC hack wasn't even a hack. It was an insider with a memory stick. I know this because I know who did it and why." Dotcom says he offered to produce evidence to Special Counsel Robert Mueller, twice, and they never even replied to him. Let me assure you, the DNC hack wasn’t even a hack. It was an insider with a memory stick. I know this because I know who did it and why. Special Counsel Mueller is not interested in my evidence. My lawyers wrote to him twice. He never replied. 360 pounds!https://t.co/AGRO0sFx7s https://t.co/epXtv0t1uN — Kim Dotcom (@KimDotcom) February 18, 2018
Twitter Moves to Stop Spread of Hacked 9/11 Lawsuit Files -- In the latest enforcement of a recently adopted policy against the distribution of hacked materials, Twitter has moved to vanquish the account of a hacking group believed to have pilfered thousands of documents from an American law firm that litigated insurance claims stemming from the Sept. 11, 2001, terrorist attacks.The policy, which forbids the spread of stolen “private information or trade secrets,” is but one of several implemented this October in the face of heightened scrutiny by Washington lawmakers, due to what U.S. intelligence portrayed as the weaponization of social media by entities tied to the Russian government.Black-hat hackers have for years spread stolen material on the platform, often with little or no consequence. Hacktivist groups like Anonymous and LulzSec are but two examples of popular accounts where, as far back as 2011, links to confidential data lifted from the servers of major corporations were openly shared.With this latest action, however, Twitter is ostensibly confirming that an era of unchecked propagation of stolen secrets is now coming to a close. The account suspended by Twitter was recently created by an established hacking group calling itself The Dark Overlord. The group had announced Monday the theft of what it said were roughly 18,000 confidential documents related to the World Trade Center attacks, which it claimed to have stolen from a company handling related insurance litigation. A reliable source of breach-related news, databreaches.net, noted on Wednesday that the initial hack, first reported in April, had garnered little attention from the press. (The site also obtained exclusive files from the hackers themselves.) Dark Overlord identified multiple insurance firms from which it claimed it acquired the stolen cache: Hiscox Syndicates Ltd., Lloyd’s of London, and Silverstein Properties.
Manafort Accused of Sharing Trump Campaign Data With Russian Associate - — As a top official in President Trump’s campaign, Paul Manafort shared political polling data with a business associate tied to Russian intelligence, according to a court filing unsealed on Tuesday. The document provided the clearest evidence to date that the Trump campaign may have tried to coordinate with Russians during the 2016 presidential race. Mr. Manafort’s lawyers made the disclosure by accident, through a formatting error in a document filed to respond to charges that he had lied to prosecutors working for the special counsel, Robert S. Mueller III, after agreeing to cooperate with their investigation into Russian interference in the election. The document also revealed that during the campaign, Mr. Manafort and his Russian associate, Konstantin V. Kilimnik, discussed a plan for peace in Ukraine. Throughout the campaign and the early days of the Trump administration, Russia and its allies were pushing various plans for Ukraine in the hope of gaining relief from American-led sanctions imposed after it annexed Crimea from Ukraine. Prosecutors and the news media have already documented a string of encounters between Russian operatives and Trump campaign associates dating from the early months of Mr. Trump’s bid for the presidency, including the now-famous meeting at Trump Tower in Manhattan with a Russian lawyer promising damaging information on Hillary Clinton. The accidental disclosure appeared to some experts to be perhaps most damning of all.“This is the closest thing we have seen to collusion,” Clint Watts, a senior fellow with the Foreign Policy Research Institute, said of the data-sharing. “The question now is, did the president know about it?” The document gave no indication of whether Mr. Trump was aware of the data transfer or how Mr. Kilimnik might have used the information.
Manafort's Lawyers Accidentally Reveal He Lied To Mueller About Kremlin-Linked Offer - In an embarrassing twist to the ongoing Paul Manafort legal saga, Manafort's attorneys have inadvertently revealed some of the lies that Paul Manafort allegedly told Special Counsel Robert Mueller, according to a reporter from the Guardian. Because they failed to redact their filings, Manafort's attorneys revealed that their client "lied about sharing polling data with Konstantin Kilimnik", a former purportedly Kremlin-connected aide to Manafort who has been accused of participating in Manafort's efforts to conceal his income from his consulting work for former Ukrainian strongman Viktor Yanukovich. NEW: Paul Manafort's attorneys failed to properly redact their filing. They reveal that Mueller alleges Manafort "lied about sharing polling data with Mr. Kilimnik related to the 2016 presidential campaign". Konstantin Kilimnik has alleged ties to Russian intelligence. — Jon Swaine (@jonswaine) January 8, 2019The filings also revealed that Manafort "was in contact with a third party" who had asked permission to drop Manafort's name during a meeting with the president.Manafort attorneys also accidentally reveal via failed redaction that Mueller says Manafort was in contact with "a third-party asking permission to use Mr. Manafort’s name as an introduction in the event the third-party met the President."— Jon Swaine (@jonswaine) January 8, 2019 In response to the Guardian reporter's tweets, another twitter user shared the text from the filing.The sentence @jonswaine reported is in the second redaction. pic.twitter.com/IjH3b9T27A— southpaw (@nycsouthpaw) January 8, 2019 In the same filing, Manafort's lawyers also revealed that Mueller suspected Manafort of lying about authorizing the "third party" to communicate with administration officials on his behalf. Manafort had reportedly told Mueller that he didn't have any direct or indirect communications with the administration.
That sophisticated, specific Russian 2016 voter targeting effort doesn’t seem to exist - The revelation on Tuesday that Donald Trump’s 2016 campaign chairman, Paul Manafort, had shared polling data with a colleague in Ukraine who had ties to Russian intelligence predictably kicked up a furor of speculation about the significance of the move. This is what one of the Russia-Trump collusion scenarios looks like: someone from Team Trump passing data to the Russians that the latter group could use to target voters and influence the election. After all, the common understanding is that Russia’s interference efforts included sophisticated targeting of specific voting groups on Facebook, which could have made the difference in states that Trump narrowly won on his way to an electoral-vote victory.That understanding about Russia’s sophisticated targeting, though, is not supported by the evidence — if it’s not flat-out wrong.Let’s assume that your goal is to win an election using social media. What Facebook offers campaigns is the ability to target voters in very specific ways, including by age, interest and location. The more refined your target, the more expensive the ad. There are other ways to leverage social media, of course, including creating your own Twitter or Facebook accounts and building up followers or broader outreach efforts that you might see from a corporation — AARP targeting people over 65, for example.If we’re talking about specific poll data being passed from the Trump campaign to Russia, though, the presumption is that the Russians would receive information that allowed very specific targeting of voters in places that would have had the biggest effect on the 2016 election. There are a lot of ways in which even that broadly stated paragraph doesn’t match well with what’s known about the Manafort situation. According to the New York Times, the information passed from Manafort included some proprietary information but, for the most part, was public, obviating the need for much cloak and dagger. The data was passed to Manafort’s colleague Konstantin Kilimnik in the spring of 2016, before Trump had been nominated by the Republican Party. It’s data that, by Election Day, would be several months out of date.
Supreme Court Hands Mueller Win Against Mystery Firm From "Country A" -The Supreme Court handed special counsel Robert Mueller a win on Tuesday, leaving in place a lower court ruling that required an unnamed foreign company to comply with a subpoena to produce information said to be related to Mueller's seemingly-limitless investigation, according to the Washington Post. Without offering any explanation, the court dissolved a temporary stay on the subpoena issued by Chief Justice John Roberts until the Justices could consider the request. The entity that is the subject of the cloaked legal battle — known in court papers simply as a “Corporation” from “Country A” — is a foreign financial institution that was issued a subpoena by a grand jury hearing evidence in the special counsel investigation, according to two people familiar with the case.It is thought to be the first time that an aspect of Mueller’s wide-ranging probe into Russian interference in the 2016 campaign has reached the Supreme Court. Last year, a federal court in Washington ordered the corporation to pay a daily fine until it complied with the subpoena, according to court records. An appeals court panel upheld that decision last month, prompting the company’s lawyers to appeal to the Supreme Court. -Washington Post The battle between Mueller and the unidentified foreign company has intrigued Washington politicos for months. In October, Politico reported that a journalist hanging around the DC Circuit Court of Appeals overheard a man in the clerk's office request a copy of the latest sealed filing from the special counsel's office in order to put together a response.
Russian Lawyer From Trump Tower Meeting Charged In Money Laundering Case - A Russian lawyer and Fusion GPS associate who attended the infamous Trump Tower meeting has been charged with obstructing justice by making a "misleading declaration" in a separate money laundering case, according to the Washington Post. Natalia Veselnitskaya - a Trump-hating fan of the late John McCain - was initially denied entry into the United States, only to be allowed into the country by former Attorney General Loretta Lynch under "extraordinary circumstances" so she could represent Fusion GPS client Prevezon Holdings in a civil case brought by the US attorney's office in Manhattan. Prevezon is owned by Russian and Israeli businessman Denis Katsyv, who settled the case for $5.9 million in fines after he was busted in a $230 million embezzlement and money laundering scheme reportedly sanctioned by Russian Officials, in which large sums of money were stolen from the Russian government and invested in New York real estate. Some of the missing funds were traced to Prevezon.The department had alleged in a civil complaint that a Russian criminal organization ran an elaborate tax refund scheme, stealing the identities of targeted companies and filing sham lawsuits to incur fake losses for refund purposes.Those involved made about $230 million in tax refunds, prosecutors said, and filtered the money through shell companies and eventually into Prevezon, a Cyprus-based real estate corporation. Prevezon, prosecutors said, laundered the funds into real estate, including by investing in high end commercial property and luxury apartments in Manhattan. -Washington PostThe alleged fraud was uncovered by attorneys hired by the victim firms to investigate, one of whom was deceased Russian lawyer Sergei Magnitsky, who died in custody. Veselnitskaya was also a central figure in the Trump Tower meeting arranged by Fusion GPS associate Rob Goldstone - who admits "it appeared to me to have been a bait and switch of somebody who appeared to be lobbying for what I now understood to be the Magnitsky act," which sanctions Russian officials thought to be involved in the Magnitsky death.
Rod Rosenstein, who oversaw Mueller’s probe, plans to leave the Justice Department after new attorney general confirmed — Deputy Attorney General Rod Rosenstein, who had been overseeing the special counsel investigation, plans to step down after Robert Mueller finishes his work, according to administration officials familiar with his thinking.A source close to Rosenstein said he intends to stay on until Mueller's investigative and prosecutorial work is done. The source said that would mean Rosenstein would remain until early March. Several legal sources have said they expect the Mueller team to conclude its work by mid-to-late February, although they said that timeline could change based on unforeseen investigative developments.The source said once Mueller's work is done, the special counsel's report to the Justice Department would follow a few weeks later, and Rosenstein would likely be gone by then.But others familiar with his thinking said there’s no firm timeline and that Rosenstein would work out a departure plan once the new attorney general is confirmed and on board.Rosenstein had long intended to serve about two years as the Justice Department's No. 2 official, the administration officials say. They add that this is his own plan and that he is not being forced out by the White House. That's despite the fact that he's been a frequent target of criticism from President Donald Trump on Twitter.The administration officials had said that Rosenstein planned to remain on the job until a new attorney general is confirmed. After pushing out Jeff Sessions in November, Trump nominated William Barr, who planned to be at the Capitol on Wednesday to begin a round of courtesy calls with senators ahead of his confirmation hearing, which begins Jan. 15.
Trump attorney general pick William Barr would let Mueller finish Russia probe, Lindsey Graham says - William Barr, President Donald Trump's attorney general nominee, would let special counsel Robert Mueller complete his ongoing investigation of Russia's election meddling and possible collusion with Trump's 2016 campaign, Sen. Lindsey Graham told reporters Wednesday."I can assure you he has a very high opinion of Mr. Mueller and he is committed to letting Mr. Mueller finish his job," Graham, R-S.C., said after a meeting with Barr in his Capitol Hill office.The reassurance from Graham, who is one of Trump's most vocal supporters, came amid reports that Deputy Attorney General Rod Rosenstein, who appointed Mueller, is planning to voluntarily step down from his No. 2 role at the Justice Department within the next month. NBC News, citing administration officials, reported that Rosenstein had intended to stay in the role for about two years.Reports of Rosenstein's forthcoming resignation fueled speculation that Mueller's probe could perhaps be nearing its long-anticipated end, even though a federal judge recently approved an extension of Mueller's grand jury by up to six months.Some have even taken the reports as a signal that Rosenstein believes the investigation would not be threatened under Barr's oversight — an interpretation that could offer relief to Mueller's supporters, some of whom have criticized Barr's past remarks on the Russia probe.In June, Barr reportedly sent a 19-page memo to the DOJ arguing that Mueller's focus on whether Trump had obstructed justice "is fatally misconceived."Public theories about the obstruction facet of the investigation have largely zeroed in on Trump's decision to fire then-FBI Director James Comey in May 2017, after Trump allegedly said he should let go of a criminal investigation into Trump's first national security advisor, Michael Flynn. Flynn's sentencing on a charge of lying to the FBI about his conversations in 2016 with then-Russian Ambassador Sergey Kislyak, originally set for December, was postponed until at least March. But Barr gave no indication of his past criticisms of Mueller on Wednesday. And en route to the office of Republican Sen. Ben Sasse of Nebraska after his meeting with Graham on Wednesday, Barr told reporters that he believed Rosenstein has done an "excellent" job as deputy attorney general.
Trump's ex-lawyer Michael Cohen will testify at House Oversight Committee before entering prison - Michael Cohen, the former personal lawyer and fixer for PresidentDonald Trump, has agreed to testify publicly before the House Oversight and Government Reform Committee in February — a month before he will begin to serve a three-year prison sentence for a range of crimes, including those related to Trump.Cohen said his planned Feb. 7 appearance in an open session of the House committee is voluntary.The testimony will give him the opportunity "to give a full and credible account of the events that have transpired," Cohen said.When asked about Cohen's planned testimony, Trump said, "I'm not worried about it at all." The hearing will come 2½ months after Cohen pleaded guilty to lying to Congress about details of an aborted Trump real estate project in Moscow.Rep. Elijah Cummings, D-Md., the Oversight Committee's chairman, announced Cohen would testify. Later, the House Intelligence Committee Chairman, Rep. Adam Schiff, D-Calif., said that "it will be necessary, however, for Mr. Cohen to answer questions pertaining to the Russia investigation, and we hope to schedule a closed session before our committee in the near future."The House last week came under the control of the new Democratic majority, which has vowed to use its power to investigate a range of controversies involving Trump and his administration.Cohen's decision to testify before the Oversight Committee is the latest example of his radical transformation from a hardcore Trump loyalist who once said he would be willing to "take a bullet" for the president to a harsh critic of and significant legal threat to Trump.Cohen, 52, had worked as Trump's lawyer for years when the president was a real estate developer in New York and star of "The Apprentice" reality television show. His association with Trump began unraveling last April, when FBI agents raided his office and residences in Manhattan, seizing evidence that led to his guilty pleas to a raft of federal crimes months later.
Treasury Secretary Mnuchin to brief lawmakers about easing sanctions on firms linked to Putin friend - Treasury Secretary Steven Mnuchin will brief lawmakers in the House of Representatives on Thursday about his department's plan to terminate sanctions on three companies linked to Oleg Deripaska, a Russian billionaire with ties to Russian President Vladimir Putin.The meeting will take place behind closed doors, according to a senior Democratic aide. It is scheduled exactly one week after Democrats officially took the majority in the House and is among the first instances of the party using its newfound power to conduct oversight of the Trump administration.The meeting follows Treasury's Dec. 19 notification to Congress that it would end sanctions on Rusal, EN+ and EuroSibEnergy in 30 days. Mnuchin said at the time that the decision was made after the companies "committed to significantly diminish Deripaska's ownership and sever his control."Deripaska, a metals tycoon and close friend and ally of Putin, remains sanctioned, meaning no American may conduct business dealings with him directly or indirectly. He has come under scrutiny in the United States for his ties to the Kremlin as well as to Paul Manafort, who served as President Donald Trump's campaign chairman and has since been convicted of a range of federal crimes in connection with special counsel Robert Mueller's Russia probe.Manafort, working with Konstantin Kilimnik, a business partner with suspected ties to Russian intelligence, reportedly offered to provide Deripaska with personal briefings on the status of the Trump campaign in 2016. Mueller has accused Manafort of sharing 2016 polling data with Kilimnik, Manafort's attorneys inadvertently revealed this week. In its notification to Congress, Treasury said that Deripaska's interests in the three companies were "effectively frozen."
House Democrats To Grill Mnuchin Over Russian Oligarch Who Was FBI Asset - House Democrats have called on Treasury Secretary Steven Mnuchin to deliver a classified briefing Thursday regarding the Trump administration's plans to end sanctions affecting several companies tied to Russian billionaire Oleg Deripaska, according to the New York Times. In April, the Trump administration hit three companies Deripaska controls with sanctions over Russian interference in the 2016 US elections; EN+, Rusal and JSC EuroSibEnergo. Following the announcement, the Treasury Department delayed their implementation - eventually deciding in December that they would be lifted following an aggressive lobbying campaign by Deripaska's network. Democratic lawmakers sent Mr. Mnuchin a letter on Tuesday seeking an explanation for why the termination of the sanctions was justified. They expressed concern that Mr. Deripaska still maintained “significant ownership” of En+, the holding company that controls Rusal, while transferring shares to VTB, a sanctioned Russian bank. They also said that the government shutdown was hampering their ability to properly review the decision. The solution approved by the Treasury Department lifts the sanctions against Mr. Deripaska’s companies in exchange for reducing his stake in EN+ from approximately 70 percent to less than 45 percent, and giving up control of that company and Rusal. -New York Times Deripaska, who had business dealings with former Trump campaign chairman Paul Manafort, was rumored to be Donald Trump's "back channel" to Russian President Vladimir Putin. The Russian oligarch hit back in September - admitting to "collusion" when he served as an FBI asset during the Obama administration.
Fed readying capital rule for insurance firms under its watch — Federal Reserve Vice Chairman for Supervision Randal Quarles on Wednesday said the agency’s approach to regulating insurance companies that include banking subsidiaries will be tailored to address each subsidiary appropriately. Speaking to the executive roundtable of the American Council of Life Insurers in Naples, Fla., Quarles said that the agency is taking a “building-block approach” to capital requirements for those insurers that fall under the Fed’s umbrella. The Fed will flesh out that approach in a proposed rule “in the not-too-distant future,” Quarles said. “As the name implies, the [building block approach] constructs ‘building blocks’ — or groupings of entities in the supervised firm — that are covered under the same capital regime,” Quarles said. “These building blocks are then used to calculate combined, enterprise-level capital resources and requirements. In each building block, the BBA generally applies the capital regime for that block to the subsidiaries in that block.” The approach was first described in an advance notice of proposed rulemaking from June 2016, but since then it has been unclear when the Fed would move toward issuing an actual proposed rule or whether the building block approach would ultimately be adopted. The Dodd-Frank Act gave the Fed authority to set capital requirements for insurance companies that own a federally insured bank as part of their structure, as well as any insurance firm designated as a "systemically important financial institution" by the Financial Stability Oversight Council. There were at one time four companies designated as SIFIs, but the last of them, the insurance giant Prudential, shed its designation in October. Insurers subject to the Fed’s jurisdiction amount to about 10% of the insurance industry. Subscribe Now Access to authoritative analysis and perspective and our data-driven report series.
Fed proposes steps to ease banks' stress-testing regimen — The Federal Reserve Board issued a proposal Tuesday that would reduce the number of banks required to conduct company-run stress tests and reduce the frequency and complexity of supervisory stress tests for larger state member banks. The proposal echoes ideas articulated by Fed Vice Chairman for Supervision Randal Quarles in a speech last July, where he noted that the passage of last year's regulatory relief bill indicated Congress’ preference that stress tests be conducted less frequently and be less onerous for smaller institutions. Consistent with the reg relief law enacted in May, the proposal would raise the threshold for state member banks to be required to run internal stress tests from $10 billion to $250 billion, effectively eliminating the stress testing requirement for all but the largest banks. The Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency issued similar proposals to implement that provision last month. Under the Fed proposal, for those state member banks above $250 billion of assets supervisory stress tests would be conducted every other year rather than annually, which the agency said is appropriate for firms that pose less of a risk to the financial system. “Based on the Board’s experience overseeing and reviewing the results of company-run stress testing over more than five years, the Board believes that a two-year stress testing cycle generally would be appropriate for certain state member banks,” the proposal said. “Specifically, the state member banks that would be subject to a two-year stress testing cycle under the proposal would not be the subsidiaries of larger, more complex firms, which can present greater risk and therefore merit closer monitoring.”
Banks are feeling effects of shutdown: ABA —The American Bankers Association called for an end to the government shutdown Friday, reporting that its members have felt the effects in their local communities. So far, the shutdown has prevented customers from securing mortgage approvals and small- business loans and threatens to cause even more harm to communities the longer it lasts, the organization said in a statement. "With the partial government shutdown continuing to impact federal employees and everyday citizens around the country, we urge the administration and Congress to end the standoff before it does any more damage to the economy, federal employees and everyday citizens,” said Rob Nichols, the president and chief executive of the ABA. Congress and the White House should work to end the partial government shutdown, the American Bankers Association urged Friday. Adobe Stock Until the government reopens, banks can offer assistance to affected customers in the form of fee waivers, loan modifications and payment deadline extensions, the group said. The partial government shutdown has created backlogs and delays at several different agencies responsible for processing loans, including the Small Business Administration and the Federal Housing Administration. At the Department of Agriculture, single-family loan processing has stopped entirely. Experts say these backlogs are likely to persist even after the shutdown ends, as agency staff will be working with an increased volume of loans.
Ocasio-Cortez reportedly in line for banking post, and that could be bad news for Wall Street - Big banks could be about to get a high-profile enemy in a very powerful place.Freshman Rep. Alexandria Ocasio-Cortez, who is a registered Democrat but identifies as a democratic socialist, is in line to be appointed to the House Financial Services Committee, according toa Politico report.The New York legislator has vowed to take on the industry that makes up the corporate backbone for much of her constituency. She said during her successful campaign in 2018, in which she refused corporate donors and upset entrenched incumbent Democrat Joe Crowley, that she was hoping for an assignment that would allow her to take on big finance."I think with our district, we can be ambitious, so we're kind of swinging for the fences on committees," Ocasio-Cortez told Hill.tvin an interview after her win. "We might as well ask for something big."With prominent Democrats looking to unwind two years of deregulation under President Donald Trump, the seat will put her in a position to exert substantial influence.Her appointment also will give new committee ChairwomanMaxine Waters, D-Calif., an important ally.During a hearing in November, shortly after the Democrats recaptured the House in the midterm elections, Waters promised that the days of Wall Street deregulation were over.""Make no mistake, come January, in this committee the days of this committee weakening regulations and putting our economy once again at risk of another financial crisis will come to an end," she said in remarks that briefly roiled markets.
10 Years After The Crisis, A Bank CEO Is Finally Heading To Trial For Fraud - After flubbing two of its most high-profile prosecutions in recent memory, the UK's Serious Fraud Office is preparing for the opening of one of its biggest cases in years: The prosecution of four senior Barclays executives over allegations of fraud and abuse dating back to the depths of the financial crisis.One of the enduring populist gripes about how governments in the US and Europe handled the fallout from the great financial crisis is that no senior bank executives were punished for the brazen fraud that fed the big banks' MBS-sales operations (though billions of dollars in fines have been paid, and are still being paid to this day). The case stems from two emergency capital raises that the bank negotiated with Qatari investors that helped Barclays avoid a government bailout. Here's more from the Financial Times:The case involves issues over what the bankers told the market when Barclays twice turned to Middle Eastern investors in 2008 as part of emergency cash calls worth £11.8bn at the height of the financial crisis.Qatari investors ploughed a total of £6.1bn into Barclays over the two capital raisings. The SFO alleges that the bankers induced the Qataris to invest through side deals worth more than £300m not fully disclosed to the market nor to other investors. The case is historic in at least one sense: When the trial begins on Monday, it will mark the first time that a former chief executive of a Western bulge bracket bank stands trial for serious legal consequences - maybe even jail time - for fraud stemming from the crisis. And while the case has nothing to do with Barclays' MBS business, the SFO's case will involve former Barclays CEO John Varley, former Investment Banking head Roger Jenkins (who negotiated the two capital raises), former Barclays Wealth boss Thomas Kalaris and former European Financial Institutions head Richard Boath, who are all facing charges of conspiracy to commit fraud in relation to the 2008 capital raising, according to the Financial Times.
Banks’ Emerging-Market Boom Leaves a Grim Legacy - Emerging markets were a boon for bankers after the 2008 crisis, when resource-rich Africa and Asia seemed to have definitively decoupled from the debt-laden economies of the U.S. and Europe. Yet as lawsuits over alleged corruption and bribery pile up, an uglier side of those glory days is emerging — and taxpayers and investors will be left to pick up the tab. Credit Suisse Group AG’s dealings in Mozambique, where about half the population lives in poverty, are the latest to be thrust in the spotlight by U.S. prosecutors. Three former employees were charged in New York this week with defrauding investors over $2 billion of state-backed loans that prosecutors say generated at least $200 million in bribes and kickbacks. Mozambique’s former finance minister has also been charged and faces extradition — something he has said he will fight. (Lawyers for the three bankers couldn’t immediately be reached for comment, according to Bloomberg News.) The case has eerie parallels with Malaysia’s 1MDB scandal, in which two former Goldman Sachs Group Inc. bankers were last year charged for allegedly covering up bribes and kickbacks from a state development fund. Both Goldman and Credit Suisse say they were deceived by rogue bankers who circumvented internal risk controls to complete the deals. (The Swiss bank itself hasn’t been accused of wrongdoing.) The charge sheets in the two cases set out the lengths to which information was hidden internally: In Credit Suisse’s case, prosecutors argue that much due diligence — from company directors to competitive tender processes — was faked. But the common thread is also one of boom-time activity, when red flags might be more likely to be missed. The backdrop to these alleged frauds was a time, around 2012 and 2013, when banks were desperate for new sources of profit after the financial crisis. Between 2008 and 2012, annual emerging-market bond issuance rose from $487.3 billion to $1.6 trillion. Amid that boom, risk controls appeared to take a back seat. The lucrative fees added an incentive. The $600 million Goldman netted from 1MDB’s fundraising amounted to a stunning 10 percent of the $6.5 billion raised.
No Bank Failures in 2018; First Time since 2006 --In 2018, no FDIC insured banks failed. This was down from 8 in 2017. This is only the third time since the FDIC was founded in 1933 that there were no bank failures in a calendar year.The great recession / housing bust / financial crisis related failures are behind us.The first graph shows the number of bank failures per year since the FDIC was founded in 1933. Typically about 7 banks fail per year. This was the first year with no failures since 2006. Note: There were a large number of failures in the '80s and early '90s. Many of these failures were related to loose lending, especially for commercial real estate. Also, a large number of the failures in the '80s and '90s were in Texas with loose regulation.Even though there were more failures in the '80s and early '90s then during the recent crisis, the recent financial crisis was much worse (larger banks failed and were bailed out). The second graph includes pre-FDIC failures. In a typical year - before the Depression - 500 banks would fail and the depositors would lose a large portion of their savings. Then, during the Depression, thousands of banks failed. Note that the S&L crisis and recent financial crisis look small on this graph.
A Wall Street Felon and High Frequency Traders Announce Plan to Form Stock Exchange - A group of nine financial firms, including an admitted felon and two high-frequency trading powerhouses, announced this week that they plan to open a national stock exchange to compete head on with the New York Stock Exchange and the Nasdaq. We’ll detail those players shortly but first some necessary background to explain why this plan must never come to fruition.Yes, our two major stock exchanges are a viper’s nest of conflicts of interest and in desperate need of reform, but this motley crew can only make matters worse. UBS, the powerful Swiss bank with a heavy presence on Wall Street, is one of the nine financial firms that announced plans to create the stock exchange, to be called Members Exchange, or MEMX. UBS received a deferred prosecution agreement from the U.S. Justice Department in 2012 for its role in engaging with other banks to rig the international interest rate benchmark known as LIBOR. In exchange for not getting prosecuted, UBS agreed to not commit any more criminal acts. This is what happened next, according to the Justice Department:“UBS engaged in deceptive FX [forex] trading and sales practices after it signed the LIBOR non-prosecution agreement, including undisclosed markups added to certain FX transactions of customers. UBS traders and sales staff misrepresented to customers on certain transactions that markups were not being added, when in fact they were. On other occasions, UBS traders and sales staff used hand signals to conceal those markups from customers. On still other occasions, certain UBS traders also tracked and executed limit orders at a level different from the customer’s specified level in order to add undisclosed markups. In addition, according to court documents, a UBS FX trader conspired with other banks acting as dealers in the FX spot market by agreeing to restrain competition in the purchase and sale of dollars and euros. UBS participated in this collusive conduct from October 2011 to at least January 2013.” As a result of its breach of its agreement, in 2015 the Justice Department charged UBS with a felony for its actions pertaining to LIBOR, to which it pled guilty.
Trillions In IPO Funds At Risk Over Government Shutdown - Welcome to day 20 of the government shutdown over a $5-billion border wall that’s taken the SEC offline and put the future of ready-to-go Initial Public Offerings (IPOs) at risk.As of December 27th, the SEC had only 285 of its 4,436 employees working, even though the agency’s electronic system for filing documents, EDGAR, (and IPO paperwork) is still online. All that means is a massive backlog of unreviewed filings.So anyone who was looking forward to an exciting year of IPOs might be disappointed because it’s getting off to a very rock … delay.The most mouth-watering of those potential IPOs are in the tech and biotech sectors, with investors hoping to jump in on a long-awaited Uber IPO, and possibly the same for rival Lyft.Uber is possibly the biggest IPO that everyone’s been waiting for because of its massive valuation, most recently by Goldman Sachs and Morgan Stanley last month for up to $120 billion—up from the $76 billion JPMorgan valued the company after its August funding round.This has gone beyond hints, with Uber CEO Dara Khosrowshahi stating that the goal was an IPO in the second half of 2019.But rival Lyft is planning an IPO in the first half of this year, assuming the SEC gets back to work. According toCNBC, Lyft hired JPMorgan Chase to lead the IPO, putting a valuation on the company of over $15 billion based on a recent funding round.Slack, the company messaging app platform, also has plans to IPO early this year, with a potential $7-billion valuation, while AirBnB has hinted at a 2019 IPO but not committed.Then we have Peter Thiel-backed data mining company Palantir reportedly considering a late-2019 IPO with a potential $40+-billion valuation. Others who might be affected include the disruptive zero-fee stock trading platform Robinhood, valued at around $5.6 billion, and clearly gunning for an IPO, as well as the $12.3-billion-valued Pinterest, which could shoot for an IPO in the second quarter of this year. It’s also worth keeping an eye on shared office space startup WeWork, valued at around $42 billion (yes, even if you’ve never heard of it) for possible IPO news, and much smaller food delivery app Postmates, valued at around $1.2 billion. The LATimes also reported this week that the $4+ billion IPO filing for bond-trading platform Tradeweb Markets may also be delayed by the shutdown.
Junk Bond Market Freeze To End With First HY Bond Sale In 2 Months - One month ago we reported that the junk bond market had effectively frozen as a result of surging spreads, or as the FT put it "ground to a halt", because for the first time since November 2008, not a single high-yield bond had priced in the market in the past 30 days. Today, the Wall Street Journal picked up on this, reporting that "December was the first month since 2008 without a junk-bond sale." In fact, the market had gone for a whopping 40 days without a sale, the longest stretch in data going back to 1995. The reason for the bond issuance drought was a familiar one: "volatility in financial markets, uncertainty about the economy and the recent drop in oil prices are discouraging riskier companies from issuing debt and investors from buying it." Of course, it hasn't been a complete freeze for the junk market, which was hit with $101 billion in net investor outflows in 2018. As we noted previously, whereas there has been no bond issuance in the past 6 weeks, loan issuance has been lively, if subdued, totaling $25 billion in November and December according to LCD. But that was still a significant slowdown from previous months.As the WSJ notes, the drop-off in debt issuance, whether junk or not, is important because it "complicates companies’ efforts to invest in plants, equipment or other business infrastructure, a key component of economic growth" (this is different from IG company borrowing needs, where the funds are usually used to fund M&A and/or stock buybacks). Additionally, firms borrowing in the high-yield bond market are also among the most sensitive to changes in financial conditions. Significant increases in their borrowing costs, particularly at a time when economic growth is slowing down, will sharply boost their chances of bankruptcy. Once they begin, dry spells in debt markets can persist, as few potential borrowers are interested in being the first to test investors’ appetite for new bonds. Among the businesses currently waiting to issue debt is the automotive-battery business that Johnson Controls International PLC is selling to a group led by Brookfield Business Partners . That deal is expected to be funded with roughly $10 billion of debt. Investors and bankers say it could take smaller bond and loan sales to pave the way for larger deals, and the successful completion of one large transaction could open the door for others.
Warren: Comerica fraud shows need for security fix in prepaid program - Sen. Elizabeth Warren, D-Mass., wants the Treasury Department to enhance fraud protection in the Direct Express prepaid program — now a partnership between the Texas-based Comerica Bank and the U.S. government — when the program's contract is rebid in 2020. In a letter to be sent Thursday to Treasury Secretary Steven Mnuchin, Warren said hundreds of federal benefits recipients were victims of fraud in the program administered by Comerica. Direct Express allows users without bank accounts to access their funds through prepaid cards. “The fraud detection and reimbursement process in the Direct Express program need to be examined with close scrutiny,” Warren wrote in the letter, a draft copy of which was obtained by American Banker. American Banker first reported in August that Comerica had shut down its Cardless Benefit Access feature after fraudsters drained accounts belonging to retirees who receive Social Security benefits and veterans who rely on disability payments. The cardless feature had allowed Direct Express users to withdraw their funds if they lost their card or were away from their home state. Comerica’s Direct Express program disperses roughly $3 billion in Social Security and disability payments to 4.5 million Americans who do not have bank accounts but who receive federal benefit payments electronically on prepaid debit cards. Cardholders have alleged that Direct Express routinely refused to reimburse them after money was stolen from their prepaid debit card accounts. Federal regulations require that consumers be given provisional credit if they file a complaint and have the prepaid card in their possession.
OCC seeks dismissal of states' lawsuit opposing fintech charter — The Office of the Comptroller of the Currency filed a motion to dismiss state regulators' legal claims that the federal agency cannot grant charters to fintech firms. The case, refiled last year by the Conference of State Bank Supervisors in the U.S. District Court for the District of Columbia, was in response to the OCC announcing in July that it would accept applications for the new special-purpose charter. No firm has yet applied for the charter partly over concerns about the pending litigation. The New York State Department of Financial Services has pursued a separate lawsuit against the OCC, which, like the CSBS case, argues that the OCC does not have clear authority to grant a fintech a banking charter that does not require the firm to take deposits. In its motion filed in the bank supervisor group's suit, the OCC said its authority permits "the use of new ways to conduct the very old business of banking.” The agency also took issue with states' claim that a firm must take deposits in order to be considered a bank. “The conclusion that a national bank need only be engaged in one of the three core banking functions — receiving deposits, paying checks, or lending money — in order to be engaged in the ‘business of banking’ aligns with the context and structure of the National Bank Act and controlling Supreme Court and D.C. Circuit caselaw,” the OCC said in its motion. “Many services or products that we now take for granted, such as ATMs, remote check capture, and online banking, were at one time cutting-edge advances. Innovation in the banking industry is inevitable” and the “federal banking system must adapt to the rapid technological changes taking place in the financial services industry,” the OCC added.
The Economics of Cryptocurrency Pump and Dump Schemes - The digital currency bitcoin (BTC) was introduced in 2009. Bitcoin and the many other digital currencies are primarily online currencies. The key currencies are those based primarily on cryptography. Bitcoin is the leading cryptocurrency, but there are nearly 2000 others. Bitcoin has experienced a meteoric rise in popularity since its introduction. Its success has inspired scores of competing cryptocurrencies that follow a similar design. Bitcoin and most other cryptocurrencies do not require a central authority to validate and settle transactions. Instead, they use cryptography (and an internal incentive system) to control transactions and manage the supply. A decentralised network validates transactions. Once confirmed, all transactions are stored digitally and recorded in a public ‘blockchain,’ which can be thought of as a distributed accounting system. The proliferation of cryptocurrencies and changes in technology have made it easier to conduct ‘pump and dump’ schemes. Many of the cryptocurrencies available today are illiquid and are characterised by very low trading volumes on most days, with occasional volume and price spikes. The surge of interest in cryptocurrencies has been accompanied by a proliferation of fraud, largely in the form of pump and dump schemes. This column provides the first measure of the scope of such schemes across cryptocurrencies. The results suggest that the phenomenon is widespread and often quite profitable, and highlight the need for concerted efforts from industry and regulators to fight cryptocurrency price manipulation.
China-Made Smartphone Weather App Stole Data From 10 Million Global Users - TCL, a Chinese producer of consumer electronics, has been collecting data without permission from mobile phones that have downloaded its free weather forecast smartphone app. This app has been downloaded more than 10 million times by users around the world since it was released in December 2016. TCL is a listed company on the Hong Kong and Shenzhen stock exchanges. It is a multinational electronics conglomerate, whose products include television sets, air conditioners, washing machines, refrigerators, and mobile phones.TCL Communication Technology Holdings, a subsidiary that manufactures smart devices and develops mobile apps, is one of TCL’s core businesses. TCL Communication also owns French phone manufacturer Alcatel and Canadian phone brand Blackberry. In 2016, TCL sold 68.77 million cell phones in 160 countries and regions.The Wall Street Journal first reported Jan. 2 that Upstream Systems, a London-based security firm, discovered that TCL’s weather app collects user data.The app in question is “Weather Forecast—World Weather Accurate Radar,” which is designed for Google’s Android system, and is a free download in the Google Play store. It provides weather predictions 21 days into the future, providing estimates on specific weather aspects such as humidity, wind speed, and visibility. According to App Annie, a smartphone app analytics and marketing data supplier, TCL’s app is among the top five weather apps in about 30 countries, including the United Kingdom and Canada. In the United States, it’s among the top 20. Upstream Systems found that TCL’s app collects users’ geographic locations, email addresses, and International Mobile Equipment Identity, a unique ID assigned to each authenticated cell phone, and keeps the data on TCL servers in China.
Inside 'cult-like' Facebook, where where dissent is discouraged and employees only pretend to be happy all the time - - At a company-wide town hall in early October, numerous Facebook employees got in line to speak about their experiences with sexual harassment. The company called the special town hall after head of policy Joel Kaplan caused an internal uproar for appearing at the congressional hearing for Judge Brett Kavanaugh. A young female employee was among those who got up to speak, addressing her comments directly to COO Sheryl Sandberg. "I was reticent to speak, Sheryl, because the pressure for us to act as though everything is fine and that we love working here is so great that it hurts," she said, according to multiple former Facebook employees who witnessed the event. "There shouldn't be this pressure to pretend to love something when I don't feel this way," said the employee, setting off a wave of applause from her colleagues at the emotional town hall in Menlo Park, California.The episode speaks to an atmosphere at Facebook in which employees feel pressure to place the company above all else in their lives, fall in line with their manager's orders and force cordiality with their colleagues so they can advance. Several former employees likened the culture to a "cult." This culture has contributed to the company's well-publicized wave of scandals over the last two years, such as governments spreading misinformation to try to influence elections and the misuse of private user data, according to many people who worked there during this period. They say Facebook might have have caught some of these problems sooner if employees were encouraged to deliver honest feedback. "There's a real culture of 'Even if you are f---ing miserable, you need to act like you love this place,'" said one ex-employee who left in October. "It is not OK to act like this is not the best place to work."
Samsung Phone Users Shocked to Find They Can't Delete Facebook - Nick Winke, a photographer in the Pacific northwest, was perusing internet forums when he came across a complaint that alarmed him: On certain Samsung Electronics Co. smartphones, users aren’t allowed to delete the Facebook app. Winke bought his Samsung Galaxy S8, an Android-based device that comes with Facebook’s social network already installed, when it was introduced in 2017. He has used the Facebook app to connect with old friends and to share pictures of natural landscapes and his Siamese cat -- but he didn’t want to be stuck with it. He tried to remove the program from his phone, but the chatter proved true -- it was undeletable. He found only an option to "disable," and he wasn’t sure what that meant. “It just absolutely baffles me that if I wanted to completely get rid of Facebook that it essentially would still be on my phone, which brings up more questions,” Winke said in an interview. “Can they still track your information, your location, or whatever else they do? We the consumer should have say in what we want and don’t want on our products.” Consumers have become more alert about their digital rights and more vigilant about privacy in the past year, following revelations about Facebook’s information-sharing practices and regulators’ heightened scrutiny of online data collection. Some people have deleted their Facebook accounts in protest of the company’s lapses, while others simply want to make sure they have the option to do so. Many Android phone users have begun to question Samsung’s deal to sell phones with a permanent version of Facebook -- and some of them are complaining on social media.
“Black Mirror” isn’t just predicting the future—it’s causing it - Black Mirror, the TV series written by the smart and gloomy Charlie Brooker, appears to routinely predict and dramatize world news and policies. But instead of merely predicting the future, the newly released “Bandersnatch” could be creating it. Yes, it’s one of the first mainstream attempts at narrative-driven gameplay on a streaming platform. But it’s also potentially the progenitor of a new form of surveillance—one that invades our privacy while wearing the cloak of entertainment. Instead of just passively watching a movie, the viewers (or players) get to choose what the main character does next. Some choices are seemingly innocent—what music to play, what to eat for breakfast—but then quickly moves on to questions about career decisions, mental-health issues, and even whether to kill other characters. All this data is collected by Netflix and stored in a secure database. (Though with so many recent hacks of other companies, it can be hard to feel assured.) Your choices are used to improve the gameplay; those seemingly innocent early decisions (like whether you chose Sugar Puffs or Frosties) impact the narrative much later in the story. Without collecting this information, it can’t send you down your personalized journey choose-your-own-adventure journey. But what happens to your decision data after the credits roll? Netflix acquires a lot of data about its users. This includes information about your viewing habits on the platform, like the programs you choose to watch and how long you watch them for. It uses this data to recommend new shows it thinks you’ll enjoy, as well as to improve its customer service and for marketing purposes. But what if instead of logging how many times you watched Love Actually this holiday season, it’s remembering whether you opted to kill your father in cold blood, or save him? What could Netflix do with that highly sensitive emotional information?
CFPB mortgage rule didn’t cost industry much, agency says - The industry's worst fears about higher costs and less available credit stemming from the Consumer Financial Protection Bureau's mortgage rules have not materialized in the years since those regulations were written, the bureau said Thursday. The CFPB on Thursday published its five-year "look-back" review of its ability-to-repay — also known as Qualified Mortgage — rule and a separate report on mortgage servicing rules that together created new standards in response to the mortgage crisis. The CFPB found that the QM rule — issued under former CFPB Director Richard Cordray— had little impact on borrowers’ access to credit or pricing. “At the aggregate market level, the Rule does not appear to have materially increased costs or prices,” the report said. CFPB nominee Kathy Kraninger “I am committed to assuring that the Bureau uses lessons drawn from the assessments to inform the Bureau’s approach to future rulemakings,” said CFPB Kathy Kraninger. Bloomberg News Rather, the bureau’s report reiterated what many in the industry at the time said about the mortgage market: Credit restrictions were driven by mortgage lenders’ desire to avoid litigation and other risks associated with the rule. CFPB Director Kathy Kraninger wrote that the reports are “not the end of the line for the Bureau.” “I am committed to assuring that the Bureau uses lessons drawn from the assessments to inform the Bureau’s approach to future rulemakings,” Kraninger wrote in an introduction. The mortgage underwriting rule required that lenders verify a borrower's ability to repay a loan using eight specific underwriting standards. Ultra-safe loans that met the definition of QM were presumed to be in compliance with the abilty-to-repay standard, and had protection from legal liability. A key finding of the 272-page report was that the QM rule did not decrease access to credit — even for borrowers with high debt-to-income ratios — because Fannie Mae and Freddie Mac loosened underwriting requirements for high DTI borrowers. Moreover, since the government-sponsored enterprises are exempt from the QM rule, the rule’s impact has been muted. Still, the QM rule did effectively eliminate loans with little to no documentation — known as “no doc" or "low doc” loans — that were popular in the run-up to the financial crisis of 2008.
Ginnie Mae head's surprise resignation prolongs permanent leadership gap - Acting Ginnie Mae President Michael Bright will leave his post on Jan. 16 and will no longer seek confirmation to be the permanent head of the mortgage secondary market agency. Bright, who joined Ginnie Mae in July 2017 as executive vice president and chief operating officer, will become the CEO of the Structured Finance Industry Group, effective Jan. 21. Maren Kasper, current executive vice president of Ginnie Mae, will serve as acting president when Bright departs, according to a Department of Housing and Urban Development statement. It's been two years since Ginnie Mae's last president, Obama appointee Ted Tozer, left the post at the start of the Trump administration after serving for seven years. Bright's nomination as Ginnie Mae president had been pending since May 2018 and President Trump would have had to renominate him due to the start of a new Congress — a move that would undoubtedly been delayed by the ongoing government shutdown. It's unclear to what extent those delays influenced Bright's decision to withdraw his name from consideration. But in his resignation letter to HUD Secretary Ben Carson, Bright called for greater awareness of the scope of Ginnie Mae's operations. "I encourage policymakers across Washington to work to understand better the processes, operations, and risks that Ginnie Mae and its staff oversee every single day," Bright wrote. While his nomination appeared to face reluctance from Democrats at his July nomination hearing, Bright was generally considered a middle-of-the-road choice for the job. The ongoing delay had been attributed to the Senate prioritizing judicial and other nominations, including Consumer Financial Protection Bureau Director Kathy Kraninger. Ginnie Mae's outstanding portfolio has recently surpassed $2 trillion and under Bright, the agency has probed and ultimately rebuked lenders accused of unnecessarily refinancing veterans' homes to boost revenue.
Freddie Mac issues first multifamily risk-sharing deal using reinsurance -- Freddie Mac completed its first multifamily credit risk transfer transaction that used an insurance/reinsurance structure. The transaction, MCIP 2018-1, covered the first 5% of credit losses for 55 loans with a balance of $915 million. The loans are in Freddie Mac's Bond Credit Enhancement and Multifamily Participation Certificate program portfolios. The average loan balance in the pool is $16.6 million. There are five reinsurers participating in this deal, with Aon acting as the broker. "This transaction is the first of many we hope to bring forward through the Multifamily Credit Insurance Pool initiative," said Robert Koontz, senior vice president of Multifamily Capital Markets, in a press release. "This is yet another great credit risk transfer offering that complements and completes our existing suites of capital market executions. We have successfully delivered similar reinsurance offerings through our single-family business, and now we're finding similar efficiencies on the multifamily side." In MCIP transactions, Freddie Mac will enter into long-term credit insurance contracts that cover credit losses from multifamily loans in the company's portfolio or bonds that it guaranteed. This structure reduces Freddie Mac's need to hold capital for the underlying loans in the pool. "Through long-term insurance contracts we can help alleviate pricing volatility and reduce execution uncertainties, allowing us to broaden our production capabilities on various types of loans that may be structurally more complicated or need longer time to aggregate," said Victor Pa, vice president of investment and advisory for Freddie Mac Multifamily. The bottom line is that we will be able to better manage risk and provide more liquidity for affordable rental housing, helping fulfill our mission.” While this is a new structure for Freddie Mac, Fannie Mae completed two multifamily credit risk transfer deals in 2018, the second in December covering $10.9 billion of loans in its portfolio.
Kamala Harris Tells Big Lie: That 2012 Mortgage Settlement Was a Good Deal for Homeowners - Yves Smith - The Big Whopper season is already upon us, in the form of presidential aspirants telling egregious lies about their track records. The Wall Street Journal tonight covers a section from Kamala Harris’ new book, in which she touts what a great deal she got for California homeowners in the so-called Federal-49 state National Mortgage Settlement in 2012. The officials who played meaningful roles in the mortgage settlement negotiation should be run out of public life, rather than failing upwards, as Harris has. Hopefully, the millions who lost their homes to foreclosure will vigorously oppose her Presidential bid. But being a successful politician apparently means having no sense of shame. In fact, as we and many others, like Dean Baker, Matt Stoller, David Dayen, Marcy Wheeler, Tom Adams, and Abigail Field recounted at the time, the settlement was a sellout to banks, a “get out of liability almost free” card. Due to widespread and probably pervasive corners-cutting during the mortgage securitization process, it appeared that the overwhelming majority of mortgages that had been securitized since the refi boom of 2003 had not had the mortgages conveyed to the securitization trusts as stipulated in the pooling and servicing agreements that governed these deals. Because these deals were designed to be rigid, for the ~80% that elected New York law to govern the trust, there was no way to straighten out these securitizations after the fact. Georgetown law professor Adam Levitin called these agreements “Frankenstein contracts” and argued that what had happened was “securitization fail,” that the securitizations had never been properly formed and thus the investors had bought what amounted to legal empty bags. Mind you, someone did have the right to collect the interest and principal from the mortgages, but that “someone” didn’t appear to be the servicers acting on behalf of the securitizations. The securitizers and servicers all acted as if they could do the paperwork needed to convey the mortgage to the trust properly if and when they needed to foreclose. The wee problem with that was that for a whole bunch of good legal reasons we won’t bore you with (but we covered in gory detail back in the day) the mortgages had to have gotten to the trust by a date certain….which was inevitably well before the foreclosure. Only a time machine could fix this problem. Servicers and foreclosure lawyers engaged in all sorts of creative frauds to try to make everything look OK. But with servicing so automated, botched, and too often deliberately abusive, quite a few of the people being foreclosed upon should have been salvaged. It would have been better for everyone, the investors, the homeowners, and the communities, except for those servicers (well, there was another bad incentive that we’ll get to in a minute). And many of the people who were foreclosed upon had missed only a payment or two, or would have been able to remain current with only a modest payment reduction. But some servicers like Wells Fargo would “pyramid” fees, impermissibly deducting a late fee first from borrower’s payment, guaranteeing that one late payment would result in all future payments being “short” and therefore late too, leading to more late fees. And that’s before you get to mortgage horror stories of bad records combined with servicer refusals to make corrections. Foreclosures on houses that had never had a mortgage. Foreclosures on houses that had burned down where the servicer refused to take the insurer’s settlement check. Foreclosures by institutions the borrower had never dealt with. Foreclosures by multiple servicers on the same home. Foreclosures on active duty service members, which was prohibited by law.
Government shutdown increases mortgage lender credit risk: Moody's - The government shutdown could affect mortgage origination credit quality as lenders miss some red flags normally found using data that is not currently available, according to a report from Moody's. "To replace origination processes that are out of commission or at reduced capacity during the shutdown, lenders will need to create more cumbersome or manual workarounds that may result in errors or, in the extreme case, instances of fraud," which makes the shutdown a negative for all mortgage originators, the Moody's report said. Nonbank lenders Lenders would need to develop workarounds to verify Social Security numbers. Even though the Internal Revenue Service said it would process requests for tax transcripts as of Jan. 7, there is an initial backlog to get through, which could be exacerbated if staffing to fulfill requests is reduced. That could lead lenders to ask the borrower directly for this information to underwrite the loan, increasing fraud risk, Moody's said. "Additionally, in the event that the shutdown becomes prolonged, this and other government systems that are currently working, such as federal flood insurance, are at risk of shutting down. In such an event, lenders may need to obtain flood insurance from alternative private lenders, a switch that could result in higher costs or, in some cases, the lack of insurance," the report said. In particular, the shutdown is a negative for nonbank lenders because they could end up not being able to sell a small percentage of their loans to the secondary market.
Waters- A million-plus could lose homes because of HUD shutdown — House Financial Services Committee Chairwoman Maxine Waters, D-Calif., called for an end to the government shutdown Thursday night, claiming that over a million households have been negatively affected by the partial closure of the Department of Housing and Urban Development. As the partial government shutdown inches toward the longest in U.S. history, most agencies within the department are “severely understaffed,” with 95% of department employees on furlough. “Millions of families that rely on HUD’s rental assistance programs are dangerously close to losing their homes due to projected lapses in funding,” Waters said in a statement, citing reports that 1,150 project-based rental assistance contracts have expired since the shutdown began on Dec. 22. If the shutdown continues, another 500 contracts will expire in January and another 550 will expire in February, a HUD spokesman told NBC News. Waters also emphasized that families looking to secure loans through the Federal Housing Administration or Department of Agriculture may face substantial delays or be unable to close during the shutdown. Though the FHA has continued to process government-backed loans during the shutdown, many anticipate a backlog in FHA endorsements that could extend beyond when the government reopens, with the agency operating at just a fraction of its work force. The shutdown has also exacerbated an existing backlog of fair-housing complaints at HUD’s Office of Fair Housing and Equal Opportunity, Waters said. Additionally, people who rely on HUD grants and loans to fix health and safety hazards may miss payments, which could worsen unsafe living conditions, she said.
FHA urges servicers to go easy on federal workers during shutdown — The Federal Housing Administration is urging mortgage servicers to provide leniency to federal workers affected by the government shutdown who are struggling with mortgage payments. FHA Commissioner Brian Montgomery sent a letter to its mortgagees Tuesday night emphasizing the agency’s policy of offering special assistance to borrowers experiencing a loss of income. In particular, the FHA expects servicers to extend special forbearance plans to borrowers impacted by the shutdown and evaluate borrowers for loss-mitigation options to prevent foreclosure. Montgomery also advised servicers to waive late fees and suspend credit reporting for affected government workers. An estimated $249 million of monthly residential mortgage payments are in danger of not being paid as a result of the shutdown, according to a Zillow estimate based on approximately 800,000 federal employees furloughed or working without pay. Many mortgage servicers are already operating forbearance plans normally used in the event of a natural disaster, which require borrowers to eventually make missed payments. The shutdown affects nearly 800,000 government employees. About 420,000 are currently working without pay and 380,000 are furloughed and not working at all.
Fannie Mae and Freddie Mac: Mortgage Serious Delinquency Rate Declined in November --Fannie Mae reported that the Single-Family Serious Delinquency rate declined to 0.76% in November, from 0.79% in October. The serious delinquency rate is down from 1.12% in November 2017. These are mortgage loans that are "three monthly payments or more past due or in foreclosure". The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%.This is the lowest serious delinquency rate for Fannie Mae since August 2007.Freddie Mac reported that the Single-Family serious delinquency rate in November was 0.70%, down from 0.71% in October. Freddie's rate is down from 0.95% in November 2017.Freddie's serious delinquency rate peaked in February 2010 at 4.20%.This is the lowest serious delinquency rate for Freddie Mac since December 2007.
Landlords reap profits from dilapidated US military housing tainted with lead, mold, brown tapwater - Mushrooms sprouting from carpets, collapsed ceilings, peeling lead paint, tapwater as brown as tea—these are a few of the health hazards assailing soldiers’ families across the US, Reuters investigations show. The private military housing industry, touted by billionaire real estate mogul John Picerne as “recession-resistant,” brings property developers some $4 billion annually in rent payments paid by the federal government via direct deposit. These fifty-year leases, which the Pentagon deems “confidential business transactions,” also funnel undisclosed hundreds of millions, if not billions of dollars of federal funds in the pockets of contractors through construction, development, and management fees. Picerne’s Corvias and other companies have their fingers in more than just military housing. Whilst tenants suffer collapsed ceilings, chipping lead paint, mold, brown tapwater, rotted roofing, wasp infestations, and rodent faeces in children’s bedrooms, the contractors’ ultrarich clientele—and the landlords themselves—enjoy vacation mansions furnished with bespoke gilded chandeliers, crystalware for crimson banquet halls designed to seat dozens, and taxidermied pythons mounted on 20-foot vaulted ceilings. “I bet he doesn’t have mold growing in those mansions,” commented Leigh Tuttle, wife of an Army major, on the multimillion-dollar estates owned by Picerne. The Tuttles moved into a renovated 1980s duplex on Fort Polk, Louisiana that has left their five-year-old son dependent on nebuliser treatments even after moving off-site. Corvias told her that the mold blooms on the floors and the air ducts were “just dust.” After testing confirmed that the “dust” was, in fact, mold, Corvias replaced the carpets but didn’t clean the air ducts.
October mortgage delinquency rate reaches 18-year low - The strong economic headwinds from last fall facilitated a declining loan delinquency rate across the country, though areas hit by natural disasters had increased defaults, according to CoreLogic. The national mortgage delinquency rate fell to 4.1% in October, down year-over-year from 5.1% and a step below September 2018's 4.4%. "Despite some regional spikes related to hurricane- and fire-impacted areas, overall delinquency rates are near or at historic lows," Frank Martell, president and CEO of CoreLogic, said in a press release. The foreclosure inventory rate, measuring loans in some stage of foreclosure, remained in its holding pattern of 0.5% since April and inched down by 0.1 percentage point from a year ago. The serious delinquency rate dropped to 1.5% from 1.9% year-over-year, marking the lowest level for any October since 2006. The share of mortgages that transitioned from current to 30 days past due decreased to 0.8% in October from 1.1% the year prior. Just before the housing crisis, the transition rate was 1.2% in January 2007 and reached an apex of 2% in November 2008. Despite October being a positive month for borrowers nationwide, 18 metro areas experienced increases in delinquency rates. Of them, seven were in either North Carolina or South Carolina — a continued impact from Hurricane Florence. "While the strong economy has helped families stay current and push overall delinquency rates lower, areas that were hit hard by natural disasters have seen a rise in loan defaults," Frank Nothaft, chief economist for CoreLogic, said in a press release. "The 30-day delinquency rate in the Panama City, Fla., metro area tripled between September and October 2018 as a result of Hurricane Michael. Two months after Hurricane Florence made landfall in the Carolinas, 60-day delinquency rates doubled in the Jacksonville, Wilmington, New Bern and Myrtle Beach metro areas. And buffeted by Kilauea's eruption in the Hawaiian Islands, serious delinquency rates jumped on the Big Island by 9% between June and October 2018, while falling by 4% in the rest of Hawaii,"
Black Knight Mortgage Monitor for November - Black Knight released their Mortgage Monitor report for November today. According to Black Knight, 3.71% of mortgages were delinquent in November, down from 4.55% in November 2017. Black Knight also reported that 0.52% of mortgages were in the foreclosure process, down from 0.66% a year ago. This gives a total of 4.23% delinquent or in foreclosure. Press Release: Black Knight: 550,000 Homeowners Regain Incentive to Refinance as Interest Rates Fall Slightly; Refinanceable Population Still Down Nearly 50 Percent from Last Year As mortgage interest rates have dropped from multi-year highs in recent weeks, the number of homeowners with mortgages who could likely qualify for and see at least a 0.75 percent interest rate reduction by refinancing has increased by approximately 550,000. Ben Although this number represents a relatively small share of outstanding mortgages, it is a sizeable increase from recent lows in the size of the refinanceable population. “As recently as last month, the size of the refinanceable population fell to a 10-year low as interest rates hit multi-year highs,” said Graboske. “Rates have since pulled back, with the 30-year fixed rate falling to 4.55 percent as of the end of December. As a result, some 550,000 homeowners with mortgages who would not benefit from refinancing have now seen their interest rate incentive to refinance return. Even so, at 2.43 million, the refinanceable population is still down nearly 50 percent from last year. Still, the increase does represent a 29 percent rise from that 10-year low, which may provide some solace to a refinance market still reeling from multiple quarters of historically low – and declining – volumes. “In fact, through the third quarter of 2018, refinances made up just 36 percent of mortgage originations, an 18-year low. And of course, as refinances decline, the purchase share of the market rises correspondingly. So now, in the most purchase-dominant market we’ve seen this century, we need to ask whether the shift in originations will have any impact on mortgage performance. The short answer, based on historical trends, is that it certainly bears close watching.
Prepayment activity hits 10-year low as mortgage refinancing decreases - Continual declines in the refinance share of mortgage originations led to prepay rates dropping to their lowest levels since 2009, according to Black Knight. Prepayments are down 33% year-over-year and 15% from October, while the refinance index keeps falling along with overall applications. "In fact, through the third quarter of 2018, refinances made up just 36% of mortgage originations, an 18-year low," Ben Graboske, executive vice president of Black Knight's data and analytics division, said in a press release. "As refinances decline, the purchase share of the market rises correspondingly. So now, in the most purchase-dominant market we've seen this century, we need to ask whether the shift in originations will have any impact on mortgage performance," Graboske continued. The diminished population of refinanceable homeowners plays a major role in fueling both the waning prepayments and refinancing. "As recently as last month, the size of the refinanceable population fell to a 10-year low as interest rates hit multiyear highs," said Graboske. "Rates have since pulled back, with the 30-year fixed rate falling to 4.55% as of the end of December. As a result, some 550,000 homeowners with mortgages who would not benefit from refinancing have now seen their interest rate incentive to refinance return. Even so, at 2.43 million, the refinanceable population is still down nearly 50% from last year." On the distressed loan front, delinquencies continued their gains in year-over-year health. November's delinquency rate dropped to 3.71% from 4.55% the year prior. However, it was a rise of 7 basis points from October. Seriously delinquent mortgages — those late in payment by 90 days or more — dropped to 1.5% from 1.97% in November 2017, a change of 23.81%. Although they did inch up from last month's rate of 1.48%. The foreclosure rate held at 0.52% for the third consecutive month, down from 0.66% a year ago — a year-over-year drop of 21.95%. November amassed 45,200 foreclosure starts, down from 47,800 year-over-year and from 50,600 in October.
Mortgage Applications Explode Higher As Rates Tumble, Shutdown Loomed - Seemingly encouraged by the dramatic slide in mortgage rates into the end of the year (and perhaps incentivized ahead of the shutdown that impacted IRS' ability to income-verify), US mortgage applications exploded 23.5% last week, with both purchase and refinancing applications rising sharply. Refinancing applications jumped 35.3% (up 80.4%, unadjusted). While some of the spike reflects seasonal noise, part of the increase is likely due to actual activity given the recent decline in mortgage rates.Mortgage rates declined sharly last week. The effective rate on a conventional 30-year loan declined nine basis points to 4.88%, the lowest since April. As Oxford Economics points out, mortgage rates have declined 45 basis points from their recent peak in early November. Some of that decline is likely to be reversed in next week’s report given the recent backup in Treasury rates. Oxford Economics notes that on an unadjusted basis, purchase applications were up 59.0% last week. Purchase applications finished December with a 1.5% gain and are starting January 6.6% above the December average. Those readings are positive for upcoming home sales reports, although the January increase is likely to moderate in the weeks ahead as seasonal impacts fade.
Mortgage Applications Rebound in Latest MBA Weekly Survey: Mortgage applications increased 23.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 4, 2019. This week’s results include an adjustment for the New Year’s Day holiday.... The Refinance Index increased 35 percent from the previous week. The seasonally adjusted Purchase Index increased 17 percent from one week earlier. The unadjusted Purchase Index increased 59 percent compared with the previous week and was 4 percent higher than the same week one year ago. “Mortgage rates fell across the board last week and applications rebounded sharply, after what was a slower than usual holiday period. The 30-year fixed-rate mortgage declined 10 basis points to 4.74 percent, the lowest since April 2018, and other loan types saw rate decreases of between 9 and 20 basis points,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “This drop in rates spurred a flurry of refinance activity – particularly for borrowers with larger loans – and pushed the average loan size on refinance applications to the highest in the survey (at $339,800). The surge in refinance activity also brought the refinance index to its highest level since last July.”, “Purchase applications had their strongest week in a month, finishing over four percent higher than a year ago, as both conventional and government purchase activity bounced back with solid gains after a sluggish holiday season.” The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to its lowest level since April 2018, 4.74 percent, from 4.84 percent, with points increasing to 0.47 from 0.42 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
Chinese buyers expand their reach in the US housing market as the middle class gets in on the act - Chinese consumers may have soured on some American products, like iPhones, but they have only sweetened on U.S. residential real estate. They have been the top foreign buyers in both units and dollar volume of residential housing for six years straight, according to the National Association of Realtors, and now they expanding to new, lower price tiers. Chinese consumers appear to be less interested in trade wars and more interested in bidding wars, according to San Francisco-based real estate agent Michi Olson, who just returned from an international real estate property show in Shanghai. "The Chinese are basically politically agnostic," Olson said. "What I mean by that is even though there is a great tension between [the] U.S. government and Chinese, the Chinese citizen seems to be able to separate the political turmoil with the sound real estate investment." Olson said the biggest difference this year is price point. Initially, it was wealthy Chinese buyers purchasing million-dollar properties, all in cash. Now more middle-class Chinese buyers are searching for lower-priced homes and they are using mortgages much more often. "The Chinese people still see the United States as a safe harbor where they can take their assets and park their money not only for their money but also for the future of their children," Olson said. Several lenders in the San Francisco area now specifically cater to Chinese buyers. The median price of a home sold to a Chinese buyer dropped from just under $530,000 in 2017 to $439,000 in 2018, according to the Realtors. And while California is still the favorite among Chinese buyers, they are now moving into markets in Texas, Georgia and Florida.
Wolf Richter: Housing Bubble Trouble in Silicon Valley & San Francisco -- Housing inventory listed for sale in the two counties that make up Silicon Valley – San Mateo County and Santa Clara County – and in the county of San Francisco, surged by 113% in December compared to December last year, to 2,691 active listings, the most for any December since 2013, when the area emerged from Housing Bust 1. December is usually near the annual low point in terms of listings, but not in 2018, when listings in December were higher than in each of the first five months that year.The chart below shows the year-over-year percentage change in active listings. The bars in red denote when the underlying dynamics of the housing market changed direction (all data via the National Association of Realtors at realtor.com): The shift is now becoming more obvious in Silicon Valley and San Francisco, among the most expensive housing markets in the US with median prices for single-family houses ranging from about $1.2 million in Santa Clara to about $1.5 million in San Mateo.With inventories for sale rising, as sales are slowing, a whiff of competition is settling in among sellers, who have to determine where the market is today, not where it was last year, and if they want to sell their property, they have to price it where the buyers are. But buyers aren’t where they were a year ago, and the bidding wars have receded into history, and mortgage rates have jumped from a year ago. The right property, priced right will sell. But if it’s priced off the market, it will likely sit. This is starting to sink in. And sellers are cutting their asking prices. In December, the number of properties on the market with price cuts in Silicon Valley and San Francisco combined skyrocketed by 455% from a year earlier to 444. This chart shows the year-over-year percentage change for each month, with the red bars denoting when bubble trouble began:
More Americans think it's a bad time to buy a home - More Americans think it is a bad time to buy a home, as fewer potential buyers can afford what is on the market. The share of Americans who think it is a good time to buy a home just dropped sharply, according to a December survey from mortgage giant Fannie Mae. Higher mortgage rates and increased home prices are likely to blame. Homes are simply very expensive right now, in relation to income, and there are still very few entry-level homes for sale. Yet while home prices are higher than they were one year ago, the pace of gains is decelerating. That is not lost on potential buyers. The share of people surveyed who think home prices will go up fell 2 percentage points, and those who expect mortgage rates to drop was unchanged. Mortgage rates did decline rather precipitously during December, from an average 4.85 percent on the 30-year fixed at the start of the month to 4.61 percent on New Year's Eve, according to Mortgage News Daily. Still, the expectation in financial markets is that mortgage rates will rise throughout 2019, and the December drop was just a temporary correction. Rates are still higher than they were one year ago. "Consumer attitudes regarding whether it's a good time to buy a home worsened significantly in the last month, as well as from a year ago, to a survey low," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Although home price growth slowed in 2018, the cumulative impact of sustained, robust increases in home prices outpacing income growth likely helped drive the share of consumers citing high home prices as a primary reason for a bad time to buy a home to a survey high." Consumers are also less bullish on the direction of the economy. The share of those who said their household income was significantly higher than a year ago fell compared with November, although it was up slightly from a year ago. Consumers are, however, quite confident about employment. A full 79 percent said they were not concerned about losing their jobs in the next year, up 11 percentage points from a year ago.
Household delinquencies are on the rise. Should bankers be worried? - More consumers fell behind on their loans in the third quarter of 2018, even as average wages rose and the unemployment rate fell to a 50-year low. Delinquencies on home equity loans and auto loans drove an overall uptick in installment loans that were at least 30 days past due, according to an American Bankers Association report released Tuesday. The analysis also showed an increase in 30-day delinquencies on credit cards issued by banks, mostly reversing the prior quarter’s improvement in that category. James Chessen, the chief economist at the ABA, was quick to point out that the delinquency levels are low by historical standards and said that recent trends are more or less a “return to normal.” Still, if economic growth slows this year, as many economists expect, delinquencies could continue to trend up, Chessen said, adding that he’s already seeing signs of banks tightening their underwriting on consumer loans. Consumer debt hit an all-time high of $13.5 trillion in the third quarter, according to data from the Federal Reserve Bank of New York, and it appears that some households have become overextended. Rising housing costs in many markets could also be putting the squeeze on many lower- and middle-income households. Compared with the prior quarter, the ratio of delinquencies in the eight loan categories the ABA tracks climbed 11 basis points to 1.87%. Delinquencies on home equity loans and direct auto loans each rose 10 basis points to 2.53% and 1.16%, respectively. Indirect auto loan delinquencies rose 6 basis points to 1.99%. Delinquencies on bank-issued credit cards rose 12 basis points to 3.05%. A report from the bond rating agency DBRS issued on Tuesday also showed the rate of credit cards at least 30 days past due rising from a decade-low rate of 2.01% in the second quarter of 2015 to 2.54% in the third quarter of 2018. Chessen warned that strong retail sales over the holiday season could foreshadow another uptick in delinquency rates down the road, as credit card bills come due.
US Consumer Credit Hits All Time High Amid Surge In Student And Auto Loans - After a surprising slump in the use of revolving debt in September, when US consumers unexpectedly paid down a total of $23 million (revised)on their credit cards, followed by a sharp rebound in credit card usage in October, moments ago the Fed reported that in November, the surge consumer credit continued, rising by $22.1 billion, above the $17.5 billion expected, after October's whopping $25 billion increase as non-revolving credit surged by the most since December 2017. The surge in borrowing in November brought the total to $3.979 trillion, new all time high, largely on the back of a newfound love with auto and student loans. After a brief, one-month dormancy in credit cards usage in September, American consumers have clearly returned to doing what they do best - spending money they don't have - with revolving credit jumping by $4.8 billion, one month after it surged by $9.3 billion. The latest monthly increase brought the total credit card debt to a new all time high of $1.042 trillion. But the big reason behind the November surge in consumer credit was nonrevolving credit, i.e. student and auto loans, which soared by $17.4 billion, the highest monthly total since 2017, and bringing the nonrevolving total to a new all time high of $2.937 trillion. In other words, while Americans have rediscovered their enthusiasm to use their credit cards, they found a particular fascination with buying cars (on credit) while taking out college loans, not necessarily in that order. And while the ongoing rebound in revolving credit use will silence any questions about the resilience of the US consumer heading into the holiday spending season, the recent dramatic upward revision to personal savings notwithstanding, one place where there were no surprises, was in the total amount of student and auto loans: here as expected, both numbers were at fresh all time highs, with a record $1.564 trillion in student loans outstanding, an impressive increase of $33 billion in the quarter, while auto debt also hit a new all time high of $1.141 trillion, an increase of $16 billion in the quarter.
Lampert Boosts Sears Rescue Package To $5 Billion In Last-Ditch Effort To Avoid Liquidation - Sears Chairman Eddie Lampert has gone back to the drawing board in his bid to save the company from liquidation, emerging with a revised package of around $5 billion, according to CNBC. This latest attempt comes one day after Lampert's initial $4.4 billion bid to save Sears was rejected by the company. It faced a number of challenges, including being short of covering Sears' administrative expenses, making it "administratively insolvent."As part of the new bid, Lampert will assume tax and vendor bills incurred since Sears' October bankruptcy, the person said. As with its previous bid, it will aim to keep roughly 50,000 jobs. -CNBCIt was unclear whether Lampert's bid also relies on debt forgiveness through a so-called "credit bid." The company's creditors cried foul over a $1.8 billion credit bid that had supported Lampert's previous offer.If Sears deems Lampert's bid acceptable - his company ESL will be allowed to participate in a January 14 auction against other buyers. Lampert's offer is the only one which would keep the company intact.On Tuesday Sears' advisors told a bankruptcy court that it will evaluate the merits of the credit bid during the January 14 auction.Whatever Sears decides, any offer would need to be approved by the bankruptcy judge i n a January 31 court hearing - who would also have to eventually sign off on a credit bid, if Lampert relies on one.
Amazon Looking At Empty Sears Stores For Whole Foods Expansion -As Amazon-owned Whole Foods looks to expand into different regions across the United States, a prime opportunity has presented itself for their real estate needs; empty locations that were previously home to Sears and Kmart stores, according to Yahoo Finance. The search has already begun, as Yahoo reports that Whole Foods managers visited a site in Utah formerly home to a Kmart which was shut down in mid-2017 amid Sears' financial woes. Sears declared bankruptcy in October of 2018, and has shut several hundred stores in recent years as it scrambled to stabilize its finances.
'Informal boycott' of American products in China may have a hand in iPhone slump, Wall Street says - Chinese consumers may be staging an informal boycott of some American products and that could be a factor behind Apple's revenue shortfall, according to Bank of America Merrill Lynch economists. Others on Wall Street have made the same claim.Apple last week stunned investors when it revealed its revenues would miss its forecast, in large part due to a drop-off in sales of its iPhone in China. Apple CEO Tim Cook laid the blame in big part on trade tensions, though Trump administration officials were at odds over whether the trade war was hitting U.S. companies doing business in China or whether Apple was its own case.BofAML economists have said the sales shortfall could also be due to other factors, including competition, price and the drop in China's currency.Ethan Harris, Bank of America Merrill Lynch chief global economist, said data on trade between China and the U.S. has been very clear and points to the potential of a consumer boycott. "I think what you see in the data is a broad pulling away from U.S. goods. If you look at the charts on imports, it's not just the products where there are tariffs by China. It's a general weakness in imports," he told CNBC.China rebuked the U.S. for tariffs last fall by reducing orders of soybeans. On Tuesday, as trade talks were underway, there was a seeming thaw in relations. China approved five genetically modified crops for import, the first in 17 months. Some of the products have been waiting for approval for six years, according to wire reports.While Chinese purchases of U.S. soybeans dropped, there was a clear pickup in Chinese imports from Brazil. "The soybean story is a big part of it. That was something we all expected. It's the broad-based drop that looks unusual and surprising, particularly since it isn't replicated with other countries," said Harris. Analysts have said the tensions between China and the U.S. over the U.S. pursuit of alleged cyber-espionage by Chinese telecom companies may also be a factor. The CFO of Huawei has been arrested in Canada and may be extradited to the U.S.
BLS: CPI declined 0.1% in December, Core CPI increased 0.2% - From the BLS: The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.1 percent in December on a seasonally adjusted basis after being unchanged in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.9 percent before seasonal adjustment.The seasonally adjusted decline in the all items index was caused by a sharp decrease in the gasoline index, which fell 7.5 percent in December. This decline more than offset increases in several indexes including shelter, food, and other energy components. The energy index fell 3.5 percent, as the gasoline and fuel oil indexes fell, but the indexes for natural gas and for electricity increased. The food index increased 0.4 percent in December. The index for all items less food and energy increased 0.2 percent in December, the same increase as in October and November. Along with the index for shelter, the indexes for recreation, medical care, and household furnishings and operations all increased in December, while the indexes for airline fares, used cars and trucks, and motor vehicle insurance all declined.The all items index increased 1.9 percent for the 12 months ending December; this was the first time the 12-month change has been under 2.0 percent since August 2017. The index for all items less food and energy rose 2.2 percent over the last 12 months, the same increase as for the 12 months ending November. I'll post a graph later today after the Cleveland Fed releases the median and trimmed-mean CPI. This was at the consensus forecast.
US Consumer Price Growth Slowest Since Aug 2017 As Gas Prices Plummet - Following China's dismal CPI and PPI prints this week, and terrible data from core Europe, all eyes are on US consumer prices with the over-arching 'goldilocks' hope that it's not too hot to prompt Powell to re-hawk and not too cold to prompt growth scares.And it seems investors got what they wanted as CPI printed an exactly in line with expectatins +1.9% YoY (still the weakest growth since August 2017), and ironically the same as China's CPI. Perhaps most critically headline CPI is now back below the Fed's mandated 2.0% Maginot Line. Under the hood, the index for all items less food and energy increased 0.2 percent in December. The shelter index increased 0.3 percent in December, the same increase as the prior month. The indexes for rent and owners' equivalent rent both increased 0.2 percent, while the index for lodging away from home rose 2.7 percent.The recreation index rose in December, increasing 0.6 percent. The medical care index rose 0.3 percent in December with its major component indexes mixed. The index for hospital services rose 0.5 percent, the physicians' services index was unchanged, and the index for prescription drugs declined 0.4 percent. The index for household furnishings and operations rose 0.3 percent in December, and the education index rose 0.2 percent. The index for airline fares fell 1.5 percent in December following a 2.4-percent decline in November. The index for used cars and trucks fell 0.2 percent after rising in October and November. The motor vehicle insurance index fell 0.2 percent, its second consecutive decline. Several indexes were unchanged in December, including those for new vehicles, apparel, and communication. The biggest driver of the slowing in overall CPI is from the energy complex. The energy index fell 3.5 percent in December following a 2.2-percent decline in November. The gasoline index fell 7.5 percent in December after a 4.2-percent decline the prior month.
Key Measures Show Inflation about the same in December as in November on YoY Basis --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% (2.4% annualized rate) in December. The 16% trimmed-mean Consumer Price Index also rose 0.2% (2.5% 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 fell 0.1% (-0.7% annualized rate) in December. The CPI less food and energy rose 0.2% (2.6% annualized rate) on a seasonally adjusted basis. Note: The Cleveland Fed released the median CPI details for December here. Motor fuel was down 60% annualized in December.
Heavy Duty Truck Orders Tumble 43% To Two Year Low - Orders for heavy duty Class 8 trucks tumbled 43% Y/Y (down 24% M/M) in December to just 21,300 units, representing the second consecutive YoY decline in 2018 and a 25-month low on a seasonally adjusted basis, according to ACT Research. Class 8 trucks are one of the more common heavy trucks on the road, used for transport, logistics and occasionally (some dump trucks) for industrial purposes and their orderbook is used by Wall Street as a coincident indicator of trade and logistical conditions. Typical 18 wheelers on the road are generally all Class 8 vehicles. As Buckingham analyst, Neil Frohnapple said, "overall, Class 8 orders were at the lower end of our expected range for the month of December as a further slowdown was anticipated given the extended industry lead-times." Meanwhile, JPM analyst Ann Duignan forecast that "given current industry fundamentals and supply chain issues, we expect production of ~330,000 in 2019 (up 2% YoY)." While December is widely considered to be the highest net order month, due to unexpected Q3 strength that normally isn't associated with the seasonally weak quarter this year and was the result of front-loading orders ahead of a new round of China tariffs, some analysts such as Frohnapple expected a Q4 slowdown: "...we expected the peak-season order period to be relatively weaker," he said. Meanwhile, Class 5-7 truck orders - consisting of medium trucks between 16,000 and 33,000 pounds - were down 5% to 21,500 units. As we pointed out in early December, the exponential surge in transportation prices as a result of an acute scarcity of truck drivers sent trucking prices soaring last year, and led to a historic spike in Class 8 truck orders as supply had scrambled to keep up with demand. That was, until November. ACT Research reported November preliminary North American Class 8 orders of 27.9K units (26.8K, seasonally adjusted), which was well below most forecasts heading into the release. When the November order numbers came out, we stated that the trucking market was finally starting to cool down: The total number of orders was down 14.5% from the same month a year ago and off 35.9% from October, when orders reached 43,600. It was the first drop in Class 8 orders this year, falling to the lowest level in 14 months and providing a fresh sign the North American trucking market is cooling down.
Trucking Boom Ends, Next Phase in Cycle Starts - In December, orders for new Class-8 trucks — the heavy trucks that haul the products of the goods-based economy across the US — plunged by 43% from a year ago, to just 21,000 orders, the lowest since August 2017, and down by 60% from August 2018. The chart shows the percent change of Class-8 truck orders for each month compared to the same month a year earlier, which eliminates the effects of seasonality (data via transportation data provider FTR): The trucking business is very dependent on the goods-based economy. Late 2017 and through much of 2018, demand for transportation services, such as shipping by truck, was very strong for a number of reasons, including a strong goods-based economy with booming e-commerce, a buildup of inventories, companies trying to front-run potential tariffs, etc. Freight rates spiked. As shippers struggled with higher costs and delays, truckers ordered new trucks to meet the demand. Truck makers were swamped with orders, and their backlog balloon to 11 months at the peak. Demand for transportation services continues to be strong, but just not as strong as it was. And trucking companies are adjusting. Their fear is overcapacity, which entails plunging freight rates, which is precisely what occurred during the transportation recession of 2015 and 2016.The chart below shows that orders in December are now in the range of orders prevailing at the beginning and at the end of the transportation recession: Over the past 12 months as of December, truckers ordered 482,000 Class-8 trucks, according to FTR data. And truck makers are still working through the large backlog.The annual capacity of truck makers in the US is about 320,000 Class-8 trucks per year. This averages out to about 26,500 per month. So the orders in December were 21% below that level. In addition, there have been some cancellations. But the current backlog still extends deep into this year.FTR VP of commercial vehicles Don Ake explains: “All the orders are in, the question now is how many of these orders will actually be built? We will have to watch the build rates and retail sales closely for clues about the future strength of the Class 8 market.”
ISM Non-Manufacturing Index decreased to 57.6% in December -- The December ISM Non-manufacturing index was at 57.6%, down from 60.7% in November. The employment index decreased in November to 56.3%, from 58.4%. Note: Above 50 indicates expansion, below 50 contraction. From the Institute for Supply Management: December 2018 Non-Manufacturing ISM Report On Business® “The NMI® registered 57.6 percent, which is 3.1 percentage points lower than the November reading of 60.7 percent. This represents continued growth in the non-manufacturing sector, at a slower rate. The Non-Manufacturing Business Activity Index decreased to 59.9 percent, 5.3 percentage points lower than the November reading of 65.2 percent, reflecting growth for the 113th consecutive month, at a slower rate in December. The New Orders Index registered 62.7 percent, 0.2 percentage point higher than the reading of 62.5 percent in November. The Employment Index decreased 2.1 percentage points in December to 56.3 percent from the November reading of 58.4 percent. The Prices Index decreased 6.7 percentage points from the November reading of 64.3 percent to 57.6 percent, indicating that prices increased in December for the 34th consecutive month. According to the NMI®, 16 non-manufacturing industries reported growth. The non-manufacturing sector’s growth rate cooled off in December. Respondents indicate that there still is concern about tariffs, despite the hold on increases by the U.S. and China. Also, comments reflect that capacity constraints have lessened; however, employment-resource challenges remain. Respondents are mostly optimistic about overall business conditions.” This graph shows the ISM non-manufacturing index (started in January 2008) and the ISM non-manufacturing employment diffusion index. This suggests slower expansion in December than in November.
Markit Services PMI: "New business growth weakest since October 2017" - The December US Services Purchasing Managers' Index conducted by Markit came in at 54.4 percent, down 0.3 from the final November estimate of 54.7. The Investing.com consensus was for 54.7 percent. The Investing.com consensus was for 54.7 percent. Markit's Services PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction. Here is the opening from the latest press release:Commenting on the PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:“Service sector business activity grew at a reassuringly solid rate in December, though like the manufacturing economy has seen the pace of expansion moderate somewhat since the strong rates enjoyed earlier in the year. Despite the slowing, the December surveys remain consistent with GDP growing at a healthy annualised rate of about 2.5% in the fourth quarter, with momentum easing only very slightly as the quarter proceeded. [Press Release] Here is a snapshot of the series since mid-2012. Here is an overlay with the equivalent PMI survey conducted by the Institute for Supply Management, which they refer to as "Non-Manufacturing" (see our full article on this series here). Over the past year, the ISM metric has been significantly the more volatile of the two.
Small Business Optimism Index decreased in December --CR Note: Most of this survey is noise, but there is some information, especially on the labor market and the "Single Most Important Problem". From the National Federation of Independent Business (NFIB): December 2018 Report: Small Business Optimism IndexThe Small Business Optimism Index was basically unchanged in December, drifting down 0.4 points to 104.4. Job openings set a new record high, job creation plans strengthened, and inventory investment plans surged. On the downside, expected real sales growth and expected business conditions in six months accounted for the decline in the Index. Job creation was solid in December with a net addition of 0.25 workers per firm (including those making no change in employment), up from 0.19 in November and the best reading since July. ...Twenty-three percent of owners cited the difficulty of finding qualified workers as their Single Most Important Business Problem, down 2 points from last month’s record high reading. Thirty-nine percent of all owners reported job openings they could not fill in the current period, up 5 points and a new record high. Labor markets are still exceptionally tight.
Weekly Initial Unemployment Claims decreased to 216,000 - The DOL reported: In the week ending January 5, the advance figure for seasonally adjusted initial claims was 216,000, a decrease of 17,000 from the previous week's revised level. The previous week's level was revised up by 2,000 from 231,000 to 233,000. The 4-week moving average was 221,750, an increase of 2,500 from the previous week's revised average. The previous week's average was revised up by 500 from 218,750 to 219,250. The previous week was revised up.The following graph shows the 4-week moving average of weekly claims since 1971.
Update: The Impact of the Government Shutdown on the January Employment Report --Earlier I wrote: The Impact of the Government Shutdown on the January Employment Report Here are some clarifications (based on further information from the BLS): As I wrote before, if the government shutdown continues through this coming week, then the unemployment rate in the January report will be negatively impacted. This is a key week since it is the reference week for the BLS report (contains the 12th of the month). If the shutdown continues through next weekend, Federal employees who are on furlough will be counted as unemployed in the January report (CPS, Household survey).If the government shutdown continues, then the unemployment rate will probably bump up to 4.0% or 4.1% in the January report. As far as the headline jobs number from the CES (Establishment survey), the jobs were people who are working without pay will still be counted. For the furloughed employees, it is different. Since they are not being paid, the positions will not be counted - UNLESS - legislation is passed that provides for back pay. If the legislation is passed, even after the reference week, the furloughed positions will be counted in the CES (headline jobs number). This is what has happened in previous shutdowns.So, for the unemployment number, it depends on what happens this week. For the headline jobs number, it depends on what legislation is eventually passed.
BLS: Job Openings decrease to 6.9 Million in November -- Notes: In November there were 6.888 million job openings, and, according to the November Employment report, there were 6.018 million unemployed. So, for the eighth consecutive month, there were more job openings than people unemployed. Also note that the number of job openings has exceeded the number of hires since January 2015 (almost 4 years). From the BLS: Job Openings and Labor Turnover Summary The number of job openings fell to 6.9 million on the last business day of November, the U.S. Bureau of Labor Statistics reported today. Over the month, hires edged down to 5.7 million, quits edged down to 3.4 million, and total separations were little changed at 5.5 million. Within separations, the quits rate and the layoffs and discharges rate were unchanged at 2.3 percent and 1.2 percent, respectively. ... The number of quits edged down in November to 3.4 million (-112,000). The quits rate was 2.3 percent. The quits level edged down for total private (-122,000) and was little changed for government. 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. This report is for November, the most recent employment report was for December. 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 decreased in November to 6.888 million from 7.131 million in October. The number of job openings (yellow) are up 16% year-over-year. Quits are up 7% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for "quits"). Job openings remain at a high level, and quits are still increasing year-over-year. This was a solid report.
Job Openings, Hires, Quits All Tumble As Labor Market Hits Unexpected Air Pocket - After the Job Openings and Labor Turnover Survey (JOLTS) reported record prints for virtually every notable labor market series in the late summer, there has been a notable slowdown in the labor market, and according to the BLS, after an upward revision in the October job openings from 7.079MM to 7,131MM, in November this number tumbled by 243K to 6.688 million, the lowest number since last June. Despite the decline in job openings, this will still be the 9th consecutive month in which there were more job openings then unemployed workers: considering that according to the payrolls report there were 6,294MM unemployed workers in December, there is now just under 600K more job openings than unemployed workers currently, (how accurate, or politically-biased the BLS data is, is another matter entirely). In other words, in an economy in which there was a perfect match between worker skills and employer needs, there would be zero unemployed people at this moment (of course, that is not the case.) According to the BLS, the number of job openings decreased for total private (-237,000) and was little changed for government. Job openings increased in transportation, warehousing, and utilities (+40,000). The job openings level decreased in a number of industries, with the largest decreases in other services (-66,000) and construction (-45,000). Job openings fell in the West region Adding to the unexpectedly downbeat labor picture, as job openings tumbled, the number of total hires also slumped, sliding by 218K November, and printing at 5.710 million. Hires fell for total private (-236,000) and was little changed for government. Hires increased in federal government (+8,000) but decreased in professional and business services (-167,000). The number of hires decreased in the South region. According to the historical correlation between the number of hires and the 12 month cumulative job change (per the Establishment Survey), the pace of hiring right now is precisely where it should be relative to the cumulative change in hiring. In light of the softest JOLTS report in many months, recall what we said in our December discussion of the JOLTS report:while both job openings and hires showed continued strength in the labor market, by one metric the job market may have peaked: the so-called "take this jobs and shove it" indicator - which shows worker confidence that they can leave their current job and find a better paying job elsewhere - dipped for a second consecutive month, declining by 50K in October, after dropping 84K in September from an all time high of 3.648 million, suggesting the workers on the margin are somewhat less reluctant to quit their jobs and look elsewhere. Well, this trend persisted in November, when the number of Quits declined by 112K, its third monthly drop in a row, the longest such stretch since late 2014, and was down to just 3.407 million, the lowest number of people quitting their jobs since April. The quits level edged down for total private (-122,000) and was little changed for government. Quits fell in professional and business services (-84,000) and in accommodation and food services (-62,000). This confirms that there has been a notable weakening in the labor market as increasingly fewer workers are confident they can find better employment terms elsewhere, or said otherwise, "the grass isn't greener" this time.
Restaurants Are Facing A Labour Crisis As Teenagers Abandon After-School Jobs -- Though it might sound counter-intuitive, the minimum wage hikes that are happening across the US in 2019 aren't the biggest employment-related threat to the restaurant industry and its bottom line. A bigger problem - surprisingly enough, given all the talk about automation displacing low-skilled workers - is a lack of willing employees.According to Bloomberg, fast food restaurants are resorting to unorthodox and creative methods to try and boost hiring as fewer teens enter the job market and wage hikes at several big-box retailers - including Wal-Mart, Amazon and Target - combined with near-record-low unemployment make low-paid food service work seem unattractive by comparison. Since 1968, teenage employment has plunged, with even young legal adults avoiding work as many enroll in college (perhaps because the debt burden being incurred seems so insurmountable, that it makes more sense to focus exclusively on school to try and boost their post-grad earning potential). Ironically, while investors and the Trump administration celebrated Friday's blockbuster jobs number, fast-food franchisees may have been one of the few groups who interpreted it as a net negative for their restaurants. One increasingly problematic impediment for fast food restaurants is the fact that they are typically loathe to raise wages... Many franchisees, who do most fast-food hiring, are loath to raise wages, which must be offset by higher menu prices. They count on ample pools of workers willing to accept modest pay. So the falloff in employment among postmillennials, those less than 22 years old, is particularly troublesome for restaurants that have depended on young workers since the days of soda jerks and carhops. Just 19 percent of 15- to 17-year-olds had jobs in 2018, compared with almost half in 1968, according to a Pew Research Center study published in November. It wasn’t much better for 18- to 21-year-olds: In 2018, 58 percent had been employed in the previous year, down from 80 percent in 1968, Pew says....So instead, they are "rethinking" their approach to hiring workers, even offering quarterly bonuses for some of their more-senior employees.
McAllen Mayor Says A Wall Won’t Solve The Realities Of Texas’ Border Problems KUT - While politicians hash out immigration policy in Washington, McAllen Mayor Jim Darling deals with the day-to-day impact of immigration in the Rio Grande Valley – one of Texas' busiest border-crossing regions. Darling says he sees several hundred asylum seekers per day come to respite centers in the area. And while media have focused on the Central American migrant caravans moving through Mexico, he says they've missed what's actually happening at the border. "We're getting almost a caravan every three or four days here on the border, of people that were released that were seeking asylum, but apparently that's not newsworthy," Darling says. Darling says the situation hasn't quite reached crisis status, but he says the U.S. definitely needs immigration reform because border towns like his bear the brunt of the consequences of a poorly functioning system. Darling says while the media is dominated by talk of illegal immigrants, the people he sees at the respite centers have come into the country legally, usually seeking asylum. As for the government shutdown, Darling says he's noticed that the border agents who are still working are strained. "The administrative people are laid off; I guess nobody figures that they have any administrative duties to support the guys in the field," Darling says. "They're our neighbors and our friends ... and they're not getting paid and they're working." Darling says he can't understand why leaders in Washington can't compromise to solve the country's immigration problems. He says Texas Sen. John Cornyn knows the border area well, and has recommended solutions to Congress, but none of those ideas have come to fruition. Darling says the U.S. needs border security but a wall doesn't make sense, especially when the Rio Grande acts as a natural border and where private property makes building a wall more complicated. If the federal government were to seize private land to build the wall, Darling says it would cost the government money – it would have to pay landowners for the "damage" to their property. "If you're separating your property with a wall, there's damages to that property to the south for sure ... just the inconvenience of getting there," Darling says. "[But] the federal government does not take that into consideration."He says municipalities like his wouldn't be able to seize land in a similar way without running into legal challenges or being required to do environmental impact reports ahead of time."I don't know why the federal government thinks they should not abide by their own standards they impose on local governments," Darling says. Besides, he says "There's no way you could spend $5 billion in one year building the wall, it's just not feasible."
‘It’s Just Too Much’: A Florida Town Grapples With a Shutdown After a Hurricane — A federal prison here in Florida’s rural Panhandle lost much of its roof and fence during Hurricane Michael in October, forcing hundreds of inmates to relocate to a facility in Yazoo City, Miss., more than 400 miles away. Since then, corrections officers have had to commute there to work, a seven-hour drive, for two-week stints. As of this week, thanks to the partial federal government shutdown, they will be doing it without pay — no paychecks and no reimbursement for gas, meals and laundry, expenses that can run hundreds of dollars per trip. “You add a hurricane, and it’s just too much,” said Mike Vinzant, a 32-year-old guard and the president of the local prison officers’ union. If nature can be blamed for creating the first financial hardship, the second is the result of the even less predictable whims in Washington: President Trump warned last week that the shutdown might last “months or even years.” In Florida, where Republicans dominated the November midterms and the state’s only Democratic senator went down in defeat, conservative towns like Marianna — along with farm communities in the South and Midwest, and towns across the country that depend on tourism revenue from scaled-back national parks — will help measure the solidity of public support for Mr. Trump and his decision to wager some of the operations of the federal government on a border wall with Mexico. Jim Dean, Marianna’s city manager, said he had already been concerned, even before the shutdown, that the hurricane would prompt public agencies to consider reducing their footprint in the region. What if an extended shutdown contributed to keeping the prison closed indefinitely? Marianna’s 7,000 residents depend on the federal medium-security prison to employ nearly 300 people in good-paying jobs with attractive benefits. Denied- How some Tennessee doctors earn big money denying disability claims - By the time Alan Chrisman was diagnosed with stage 4 colorectal cancer, he was too sick to work. The cancer had spread to his lungs. His doctors said he may never get better.Chrisman, 59, applied for disability, the federal safety net program he contributed to with every paycheck during his 30 years working as a stonemason.But a doctor hired by Tennessee’s Disability Determination Services to review applications quickly concluded Chrisman wasn’t sick enough to get the $804 monthly benefit.That physician, Dr. Thomas Thrush, is one of about 50 doctors contracted to review applications for Tennesseans seeking disability. The doctors are paid a flat rate for each application file they review. How much they earn depends on how fast they work.Thrush, like many of the doctors who contract with the state, works very fast. In fiscal year 2018, he reviewed — on average — one case every 12 minutes. Thrush’s productivity has paid off. He earned $420,000 for reviewing the applications of 9,088 Tennesseans applying for disability during the year ending June 30. He has made more than $2.2 million since 2013. On average, 80 percent of the cases he reviewed were denied. Tennessee has among the highest denial rates for disability applicants in the nation, rejecting 72 percent of all claims in 2017. The national average for denials was 66 percent. Outside experts and former and current state employees say it’s impossible to review cases so quickly without making mistakes that lead to wrongful rejections of disability benefits.
How Cities Make Money by Fining the Poor - NYT. No government agency comprehensively tracks the extent of criminal-justice debt owed by poor defendants, but experts estimate that those fines and fees total tens of billions of dollars. That number is likely to grow in coming years, and significantly: National Public Radio, in a survey conducted with the Brennan Center for Justice and the National Center for State Courts, found that 48 states increased their civil and criminal court fees from 2010 to 2014. And because wealthy and middle-class Americans can typically afford either the initial fee or the services of an attorney, it will be the poor who shoulder the bulk of the burden.“You think about what we want to define us as Americans: equal opportunity, equal protection under the law,” Mitali Nagrecha, the director of Harvard’s National Criminal Justice Debt Initiative, told me. “But what we’re seeing in these situations is that not only are the poor in the United States treated differently than people with means, but that the courts are actually aggravating and perpetuating poverty.” Why they do so is in part a matter of economic reality: In areas hit by recession or falling tax revenue, fines and fees help pay the bills. (The costs of housing and feeding inmates can be subsidized by the state.) As the Fines and Fees Justice Center, an advocacy organization based in New York, has documented, financial penalties on the poor are now a leading source of revenue for municipalities around the country. In Alabama, for example, the Southern Poverty Law Center took up the case of a woman who was jailed for missing a court date related to an unpaid utility bill. In Oregon, courts have issued hefty fines to the parents of truant schoolchildren. Many counties around the country engage in civil forfeiture, the seizure of vehicles and cash from people suspected (but not necessarily proven in court) of having broken the law. In Louisiana, pretrial diversion laws empower the police to offer traffic offenders a choice: Pay up quickly, and the ticket won’t go on your record; fight the ticket in court, and you’ll face additional fees.
Virginia Study Finds Increased School Bullying In Areas That Voted For Trump - After the 2016 presidential election, teachers across the country reported they were seeing increased name-calling and bullying in their classrooms. Now, research shows that those stories — at least in one state — are confirmed by student surveys. Francis Huang of the University of Missouri and Dewey Cornell of the University of Virginia used data from a school climate survey taken by over 150,000 students across Virginia. They looked at student responses to questions about bullying and teasing from 2015 and 2017. Their findings were published Wednesday in Educational Researcher, a peer-reviewed journal of the American Educational Research Association. In the 2017 responses, Huang and Cornell found higher rates of bullying and certain types of teasing in areas where voters favored Donald Trump over Hillary Clinton in the 2016 election. Seventh- and eighth-graders in areas that favored Trump reported bullying rates in spring 2017 that were 18 percent higher than students living in areas that went for Clinton. They were also 9 percent more likely to report that kids at their schools were teased because of their race or ethnicity. In the 2015 data, there were "no meaningful differences" in those findings across communities, the researchers wrote. These findings come at a time when school bullying rates nationally have remained relatively flat, according to the Centers for Disease Control and Prevention. Findings from the CDC's Youth Risk Behavior Survey show that about 1 in 5 students were bullied at school in 2017.
Los Angeles teachers prepare for strike - More than 33,000 teachers in the Los Angeles Unified School District are set to strike Thursday in what would be the largest walkout by educators in the US since last year’s statewide strikes in West Virginia, Oklahoma and Arizona. Like the previous struggles, the battle in the nation’s second largest school district centers on the fight by educators against the assault by both the Democratic and Republican parties on the right to public education. Teachers are demanding pay raises, smaller class sizes and increased funding to hire more nurses, librarians, counselors and other critical support staff. They are also opposing the school authorities’ use of standardized tests to scapegoat teachers for educational problems caused by the defunding of education and the deterioration of social conditions. In Los Angeles, as in other school districts, the shutting down of “failing schools” has been used as the justification for a vast expansion of for-profit charter schools, which siphon off an estimated $600 million from LA public schools each year. While last year’s statewide strikes largely pitted educators against Republican-led state governments, in Los Angeles teachers are fighting directly against the Democratic Party, which controls the school district and the local government, holds the governor’s seat, and wields a super-majority in both houses of the state legislature.
Los Angeles and the billionaires’ plan to destroy public education - The struggle of Los Angeles teachers and school workers highlights the ever-increasing and direct role of American oligarchs in shaping US education policy, particularly through their corporate "philanthropies.” Their nationally financed and concerted efforts to gut public education and replace it with a privatized for-profit system have now placed LA workers and young people city directly in the crosshairs. The struggle unfolding in Los Angeles this week has fundamental implications for the future of American education. Austin Beutner, the superintendent of the Los Angeles Unified School District (LAUSD) and a multibillionaire and former hedge fund manager, is speaking for Wall Street interests and pressing for a reorganization of the nation’s second largest school district. He played a significant role in a similar capacity as a USAID representative for the Bill Clinton administration in 1993. Beutner’s role was to represent US corporate interests in the looting of the assets within the former Soviet Union. Today he is working in sync with billionaire privatizers, among them Los Angeles-based Eli Broad (worth an estimated $6.7 billion). Broad, through the Eli and Edythe Broad Foundation, has provided tens of millions of dollars to lobby, support, and finance charter schools nationwide. His Broad Academy, formed in 2002, serves as a leadership development program for urban school system superintendents committed to a corporate agenda. Its alumni have gone on to lead nearly 80 school districts, six have become state superintendents, and a number oversee large charter management organizations. Beutner was installed in his current position by a Broad-controlled school board in May 2018.
Why the LA Teachers Strike Matters - The January 10 strike date announced by the United Teachers of Los Angeles (UTLA) has heightened tensions in an already contentious dispute with Los Angeles Superintendent Austin Beutner, who represents the Los Angeles Unified School District (LAUSD) in negotiations. However, far more is at stake in Los Angeles and for the rest of us than a traditional contract struggle.Given how many students LAUSD educates, the possibility of a strike by its union is huge news. LAUSD has 694,000 in its schools. The entire state of Oklahoma educates about that same number of students in its public schools.The reforms LAUSD has demanded in Los Angeles schools are based on the bipartisan project to convert public education into a lucrative market for wealthy investors. Merrill-Lynch heralded this change in a 1999 report for prospective investors: “A new mindset is necessary, one that views families as customers, schools as ‘retail outlets’ where educational services are received, and the school board as a customer service department that hears and addresses parental concerns.” Networks of wealthy billionaires and the foundations they create have advocated and imposed reforms nationally, even globally, we see today in LA schools: using standardized tests to control what and how children learn; creating charter schools to weaken neighborhood schools and undermine parent loyalty to public education; creating new revenue sources for corporations to profit from education; and weakening teachers unions. The “portfolio model” LAUSD has announced it will adopt fragments the school system into networks operated by private charter management organizations. The explicit rationale for the portfolio model is enhancing “choice,” providing more and better educational options for low-income children of color. But research by scholars who work independent of think-tank funding documents that privatization has increased school segregation and racial disparities in educational outcomes. Its main achievement has been to “plunder” public education.
On eve of strike, union drops LA teachers’ demands against school privatization - Just three days before more than 33,000 Los Angeles educators are set to walk out in the latest battle by US teachers against the assault on public education, the United Teachers Los Angeles (UTLA) union has announced that it is dropping six major demands for which teachers have been fighting, including a halt to the expansion of charter schools and an end to unlimited standardized testing and other corporate-backed schemes to privatize the public schools. UTLA President Alex Caputo-Pearl made the announcement during a Monday afternoon press conference after meeting with officials from the Los Angeles Unified School District (LAUSD). He also said the union would be willing to delay the calling of a strike if a court ruled in favor of the district, which filed a lawsuit falsely claiming that the district did not have sufficient notice of a strike. After going to court Tuesday, the UTLA will resume negotiations Wednesday in an effort to avert a strike, Caputo-Pearl said. Seeking to justify the union’s capitulation, the UTLA president said the union did not want to be tied up in an expensive court battle over what issues could be legally negotiated within the confines of state labor law. “We have withdrawn six proposals because we don’t want to fall prey to legal maneuvers by (District Superintendent) Austin Beutner, who has hired a bunch of high-priced lawyers to tell us we can’t bargain these. So we’ve withdrawn them.” Stating that “we are limited on what we can legally bargain,” Caputo-Pearl said the union had dropped issues “like unregulated growth of charters, like the $600 million which is drained out of public district schools, like basic transparency. We just had the head of Celerity Charter thrown in jail for giving himself a half-a-million-dollar salary, and equity. We know that many charter schools don’t serve special education students to the same degree.” “All those issues,” he admitted, “are essential to address for the future of public education in Los Angeles, but we will have to deal with them outside of bargaining.”
Highly paid substitutes, lessons in large spaces — how L.A. Unified is preparing for a teachers strike - With more than 30,000 teachers union members ready to strike Thursday, the Los Angeles Unified School District is preparing to bring in highly paid substitutes, supervise students in large spaces such as auditoriums and ease background checks for parent volunteers, according to records obtained by The Times. The school system probably will also use online instruction in an effort to continue to provide education.United Teachers Los Angeles, which has scheduled the strike, also represents substitute teachers. But in October, the Los Angeles Board of Education authorized $3 million to hire thousands of outside substitutes, including teachers, campus aides, special education assistants, nurses and teachers aides, to replace absent union members. The district began searching in September for companies that could provide non-LAUSD employees to work such positions, according to the request for proposals. Contracts were signed with at least five agencies. A spokeswoman said this month the district would “bring in about 400 substitutes” if there was a strike, and that about 2,000 district employees who have teaching credentials but are not in the teachers union have been assigned to work in specific schools or areas. “We have a duty to provide an education to our students, and we will take appropriate measures to do so,” a district spokeswoman said in a statement. The union has said it will fight the district on outside hiring for temporary positions and is “exploring all options to consider legal action to protect the work of UTLA substitutes,” according to a statement last month. The district’s current plans would put schools at about 8% of regular staffing by teachers union members. But the October contracts with agencies, including the Charter Substitute Teacher Network and Maxim Healthcare Services Inc., allow for more than 4,400 substitutes to be brought in. In many cases, these substitutes would make more than regular L.A. Unified substitutes for the same jobs. A regular K-12 substitute for the district makes $190 a day for the first 20 days. The contract subs in the same position could make $227 to $315 a day, depending on which agency provides them.
Los Angeles teachers angered as union delays strike again - Los Angeles teachers, who were set to strike on Thursday, reacted with anger and frustration over the decision by the United Teachers Los Angeles (UTLA) to postpone their strike despite the intransigence of school district officials and nearly 20 months of fruitless negotiations, state mediation and fact-finding.UTLA officials announced the union was delaying any strike at least until Monday, January 14, and that they would resume talks with Los Angeles Unified School District (LAUSD) Superintendent Austin Beutner on Friday in an effort to work out a deal to avert a walkout altogether. This follows the climbdown on Monday, when UTLA President Alex Caputo-Pearl announced that the union was dropping six major demands related to teachers’ opposition to charter schools, standardized testing and other schemes used to privatize education.Maria, an adult ESL teacher, told the World Socialist Web Site Teacher Newsletter, “I heard the union is giving up on the charter school issue. I didn’t like that at all. That’s just the beginning of giving up on everything. Charter schools—that’s big, really big. I taught at a charter school, and the only ones that it will be better for will be the people who are making money on charters. I’m disgusted with that.”Referring to the union postponing the strike, she added, “There’s goes the next thing. This tells me that the union is going to give up on a whole bunch of other things. I don’t like it at all.” In a press conference on Wednesday, Caputo-Pearl tried to justify the latest surrender by claiming that the postponement was necessary to give parents more time to prepare for a strike, even though the entire city was anticipating a strike on Thursday and parents are solidly behind the teachers.
Widespread support for Los Angeles teacher strike as unions seek to block statewide struggle - Students, parents and other workers expressed their support for Los Angeles teachers, who are determined to walk out for improved wages and to oppose the drive to dismantle public education. More than 33,000 teachers, librarians and nurses were set to strike Thursday before the United Teachers Los Angeles (UTLA) pushed back the strike deadline, saying teachers would strike on Monday if no agreement was reached. Backed by powerful corporate interests that are pushing for the privatization of public education, the Los Angeles Unified School District (LAUSD), led by former investment banker Austin Beutner, is refusing to budge on its demands to further erode teachers’ wages and health benefits, increase class sizes and use standardized testing to scapegoat teachers and replace “failing” schools with for-profit charter businesses. In the face of this, the UTLA has consistently retreated, dropping the teachers’ most pressing demands, including opposition to the expansion of charter schools, and repeatedly stalling when it comes to strike action, despite an overwhelming strike mandate by teachers. Educators throughout the state are champing at the bit for a struggle. On Wednesday night, hundreds of parents and students packed a school board meeting in Oakland to oppose plans to close nearly one-third of the district’s schools, even as public money is siphoned off for charter schools. Teachers throughout the state have expressed solidarity with LA teachers, with support growing for a statewide strike like the ones that occurred in West Virginia, Oklahoma, Arizona and other states last year.
What Gen Z Learned From Millennials- Skip College - Generation Z is already learning from the millennial generation’s mistakes... For years, millennials have scoffed at the notion of fixing someone else’s toilet, installing elevators, or cleaning a patient’s teeth. Instead, they wanted to get educated in lesbian dance theory, gender studies, and how white people and western civilization destroyed the world. As a result, student loan debt has surpassed the $1 trillion mark, the youth unemployment rate hovers around 9%, and the most tech-savvy and educated generation is delaying adulthood.But their generational successors are not making the same mistakes, choosing to put in a good day’s work rather than whining on Twitter about how “problematic” the TV series Seinfeld was. It appears that young folks are paying attention to the wisdom of Mike Rowe, the American television host who has highlighted the benefits and importance of trade schools and blue-collar work – he has also made headlines for poking fun at man-babies and so-called Starbucks shelters.Will Generation Z become the laughing stock of the world, too? Unlikely. A new report from VICE Magazine suggests that Generation Z – those born around the late-1990s and early-2000s – are turning to trade schools, not university and college, for careers. Ostensibly, a growing number of younger students are seeing stable paychecks in in-demand fields without having to collapse under the weight of crushing debt.Because Gen Zers want to learn now and work now, they are abandoning the traditional four-year route, a somewhat precocious response to the ever-evolving global economy.Cosmetologist, petroleum technician, and respiratory therapist are just some of the positions that this generation of selfies, Snapchat, and emoticons are taking. And this is an encouraging development, considering that participation in career and technical education (CTE) has steadily declined since 1990.
OWU Offers 'Social Justice' Major With Mandatory 'Activism' Work A university in Ohio is offering a “social justice major” to students, aiming to "cultivate...the knowledge and skills needed to analyze social injustices.” Ohio Wesleyan University is offering the major to undergraduate students who are interested in creating social change through activism, stating that the major gives students the skills to “reflect critically on the meaning of social justice” on multiple levels.“Through this interdisciplinary major, students will develop the knowledge and skills to reflect critically on the meaning of social justice at both the local and global levels, examine the dynamics of societal conflicts and struggles for social justice within and among various groups and institutions, and apply interdisciplinary perspectives at multiple levels of analysis,” states the description for the major.In addition to coursework, the major requires that each student does work outside of class, which includes an “activism” project.“Students will be required to supplement their classwork with a more experientially-oriented activist project, and will be encouraged to further participate in a travel-learning course, theory-to-practice grant, and other service projects,” states the description.The university contends that these activism components of the major which take place outside of the classroom will give students the chance to build career-related skills, such as “community o rganizing, working with and mediating diverse social groups, presenting ideas in professional forums, and managing real-world projects.”
How an outdated law is leaving millions of low-income college students hungry - Nearly 2 million college students who are likely eligible for food stamps aren’t receiving them, according to a new report issued by the Government Accountability Office (GAO) on food insecurity in higher education. But behind that headline, there is a more nuanced, and in some ways more critical, story about who typical college students seem to be in the popular imagination—versus who they actually are. The report, released on Wednesday, was the result of an in-depth analysis of 31 different studies on campus hunger and numerous interviews with governmental officials, administrators, and students at 14 selected colleges across the country. As part of its research, GAO also examined what is known about the extent of food insecurity among college students, how the 14 schools are addressing it, and the extent to which federal programs are of any help to students who are struggling to feed themselves. What it found is alarming: Millions of college students may be going hungry despite qualifying for the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps). That finding is particularly surprising given the rash of recent evidence showing that college students are experiencing disproportionately high rates of hunger. A 2017 survey of the California public university system, for instance, found that 40 percent of its undergraduate and graduate students faced food insecurity—defined by the Department of Agriculture (USDA) as a range of experiences including reduced quality of diet and reduced food intake. From kindergarten through high school, students from low-income families can often qualify for free or reduced-price meals. The GAO report defines “low-income” as earning a household income at or below 130 percent of the federal poverty line, which is also the income eligibility limit to qualify for SNAP (that’s currently $1,316 for a single-person). But there’s no equivalent college-level program, the GAO report points out. Kids who may have counted for years on free breakfast and lunch every day are left in the lurch when they advance to college.
Income Sharing’ Is Wall Street’s Potentially Predatory Alternative to Student Loans (interview & transcript) It was inevitable that the "disruptors" of Wall Street and Silicon Valley would one day turn toward higher education. A decades-long march toward more and more student debt in America—the number has reached $1.5 trillion nationally—has made it clear that the college system is broken in all sorts of ways. The approach some of the top wizards of finance have been gravitating toward is a scheme centered on what are called "income share agreements" (ISAs). The idea is that you get to go to college—or some kind of vocational program—for free or close to it, but when you graduate, you owe a generous chunk of your newfound income to those who sponsored your education.Programs like this are already in place at Purdue University in Indiana, but also, as the New York Times highlighted in a piece plugging the phenomenon. Tuesday, the Lambda School, a start-up that provides free, targeted coursework online (typically for half a year) in exchange for 17 percent of your income when you graduate, payable over a period of two years. There are some provisions that make it attractive, at least in the Times's telling: If you make less than $50,000, you're off the hook on those payments, and if you lose your job, you get a break from having to make them. For perspective on what it means that America's financial mavens seem intent on treating students as instruments for capital investment—risks to be managed, in other words—and whether this is actually a worthwhile or wise way to avoid the debt train, I called up Julie Margetta Morgan. She's a fellow at the left-leaning Roosevelt Institute, an expert on student loans, and a former senior policy advisor to Elizabeth Warren.
Source of Pro-Israel Keyboard Warriors on Social Media Finally Exposed - A number of prominent Jewish-American leaders are funding covert, anonymous campaigns targeting pro-Palestinian student activists, The Forward has found. The Jewish daily newspaper, which has been publishing valuable information concerning the source of funding for these hyper-aggressive and shadowy groups – which spearhead coordinated hate campaigns against critics of the Zionist state – has uncovered the identities of those behind hidden social media accounts. Community heads and prominent Jewish organisations with a carefully-crafted, respectable public profile have donated millions to fund secret projects targeting students and lecturers, the report has found. On a number of occasions, their blind support for Israel has seen them bankroll far-right and anti-Muslim hate groups. The latest pro-Israeli group to be exposed by The Forward is the campaign targeting the pro-Palestinian campus network Students for Justice in Palestine (SJP). SJP is said to be the most well-known advocate of the Palestinian cause on US campuses. It has been the target of a pro-Israel group known as SJP Uncovered, which anonymously attacks student activists affiliated with SJP across the country. With more than 100,000 followers on Facebook, SJP Uncovered has gone after pro-Palestinian students by maintaining a veil of anonymity that is said to be all-but impenetrable. Until now, the source of funding for SJP Uncovered had been a mystery. The Forward has now been able to shed light on the organisation to reveal that the site is a secret project of the Israel on Campus Coalition (ICC), a Washington DC-based pro-Israel organisation tied to most mainstream funders and organisations in the Jewish community.
What a Student Loan ‘Bubble’ Bursting Might Look Like - Over the past few years, I've written a lot about how current and former American students are roughly $1.5 trillion in the hole, and how this system is helping prevent an entire generation from achieving milestones of adulthood such as marriage, homeownership, and saving for retirement. In that time, I stumbled on a simmering debate among economists and student-loan experts. Some argue everything is basically OK, because the student-loan default rate for people who went to public colleges has been holding roughly steady at around 11 percent (though it's grown over the years), and average lifetime earnings of people with a degree has tended to be about 75 percent higher than that of people with a high-school diploma or less. But others push back on this, citing the volume of defaults and also the sheer number of people involved in income-based repayment plans that allow them to nominally stay on good terms with their provider while never chipping away at the principal of their loan. Basically, what these people have been arguing about is whether or not higher education constituted a kind of speculative bubble. And while Margot Robbie could explain the conditions that create such a phenomenon in about 90 seconds, real life is often more complicated than a movie based on it. Thoughsome voices have certainly used the specific term "bubble" to describe the US higher-education system, it's not a mainstream view. Still, it seems obvious that something's wrong when a whopping nearly 40 percent of borrowers are expected to default on their student loan payments by 2023. So I set out to get a sense of what calling the student-loan system a bubble actually means, and what that bubble bursting might look like for basically anyone who has attended or is considering attending college in the future. What I found was not particularly reassuring.
‘A Pumping Conspiracy’: Why Workers Smuggled Breast Pumps Into Prison - Susan Van Son, a nurse at the Deerfield Correctional Center in southeastern Virginia, left the prison’s medical department and walked through a series of eight locked doors. At a security checkpoint, she made sure that the normal guards — the ones known for breezily waving employees through the metal detectors — were on duty. Then, risking her livelihood, she headed to the prison’s parking lot. Over the next two nights, she sneaked in every piece of the pump, save for one. Ms. Van Son’s breasts weren’t big enough to conceal the funnel, so she enlisted a better-endowed colleague to shuttle it in for her. Other women who worked at the prison took part in similar smuggling schemes. It was necessary, they said, because Deerfield, a state prison in the town of Capron, didn’t allow them to bring breast pumps into their work space, inside the security perimeter. That situation, where producing breast milk at work is unfeasible, is common among American employers — even though failing to provide hourly workers with break time and a private place to pump is often a violation of federal law. There are health consequences for potentially millions of families.There is consensus among doctors that breast-feeding tends to make both mothers and their children healthier. Controlling for socioeconomic factors, studies find that babies who consume breast milk are at lower risk of sudden infant death syndrome, infections, allergies, asthma, childhood diabetes and two types of leukemia. Mothers who breast-feed or pump are at lower risk for breast and ovarian cancers, diabetes and hypertension.Yet the United States has one of the lowest breast-feeding rates of any industrialized nation. One reason is that, unlike every other developed country, the government doesn’t guarantee paid maternity leave. Once back at work, many women find that their employers make it virtually impossible to pump. A 2013 survey of 550 women nationwide conducted by researchers at the University of Minnesota School of Public Health found that 60 percent did not have the time or a place to express milk on the job.
Kiss What Is Left of Your Medical Data Privacy Goodbye - Matt Stoller warned back in 2012 that insurers would increasingly induce, then force, customers to agree to surveillance. But a Wall Street Journal story tonight describes how insurers and medical providers, meaning your doctor’s employers, are actively cooperating, so as among other things, to help Big Pharma peddle more drugs to you.Stoller warned that over time, insurance companies would make it prohibitive and eventually impossible to refuse to agree to intensive monitoring:Profit-driven surveillance does not start and stop with young adults. It is, in fact, becoming pervasive. The main theme of a recent IBM consulting document on the future of the insurance industry is how much more money an insurance company can make if it tracks and tags its customers. This is particularly true for auto insurance companies, some of whom like Allstate and Progressive are experimenting on new technologies. For instance, IBM suggests that “A “pay-as-you-live” product would trade some location and time-of-day privacy data for lower insurance bills overall.”IBM is recommending these companies stick a sensor in your car, measure where you go and when, your speed, acceleration and deceleration, etc. The progression over time could be to withdraw traditional insurance products, so that you won’t be able to get an insurance product without sensors attached. As this presentation offers, “The aforementioned rising tide of technology also empowers insurance underwriters to bring their products closer to realtime interaction via sensor networks and enlightened privacy regulations.”… Now at least this progression has the appearance of being consensual. First you are paid for giving up your privacy, then over time, the positioning changes so that customers have to pay a premium for non-monitored products, and then as their usage falls (and you get a lot of adverse selection), the insurer can pretend to be justified in getting rid of the privacy products, having set them up to fail. And even though far too many people are perfectly happy to wear devices that monitor some health measures on an ongoing basis, at least they chose for the data to be collected and hopefully have some appreciation that promises about privacy too often aren’t what they appear to be.
This Is How America Is Failing Its Young Opioid Generation -- Jeremy Beal woke up on the floor of a friend’s house in November 2017. Fifteen minutes earlier, he’d been dying from an overdose. The 25-year-old from Maine had stopped breathing for 12 minutes after overdosingon heroin. Recalling the evening, Beal said he’d used a small amount of heroin while drinking alcohol. It was enough to cause an overdose, perhaps because he hadn't been using for a few weeks before that. A friend revived him with two hits of Narcan, the nasal spray that reverses the effects of a drug overdose. Then the cops came in. Beal was taken to the hospital, checked out, and promptly arrested in his bed for unpaid fines. Within two hours of nearly dying, he was handcuffed and taken to the police station to spend the night in jail.The episode was one of a long line of unfortunate interactions Beal had with the criminal justice system in Maine during his six years as an opioid user. While trying to deal with his addiction, he was arrested four times, placed in solitary confinement, and caught up in a Maine Drug Enforcement Agency (DEA) investigation. He tried to address his addiction, twice seeking assistance from rehabilitation programs. A series of interviews with Beal and those close to him highlighted the everyday reality for many of America’s almost three million people struggling with prescription and street opioid misuse. Crucially, the evidence suggests Beal’s experiences are not extraordinary, even if his status as a white man with decent access to resources via his family and community may have spared him an even more onerous saga. Which makes the whole thing all the more pernicious: Even after all the media coverage, attempts by law enforcement officials and healthcare professionals to fight the opioid crisis continue to reinforce the very problems they are meant to address.
Healthcare Triage: Rural Hospital Closures Impact the Health of a Lot of People – video by Aaron Carroll - Rural hospitals in the United States are having an increasingly hard time staying in business. Which is not great for the health of people who live in areas that no longer have a hospital.
The Mysteries Surrounding Rhodes Pharmaceuticals, the Sackler Family’s Second Opioid Company - Today’s mysteries involve beneficial ownership. Beneficial ownership questions are important to anti-corruption campaigners. Beneficial ownership simply refers to “anyone who enjoys the benefits of ownership of a security or property, without being on the record as being the owner.” (per Wikipedia). Concealing who really owns a company enables concealing sources of funds (as in money laundering), market power (when the owner also owns competitors), and sources of political influence, and enables those benefiting from the actions of the company to escape responsibility for their consequences. A few months ago, a big question about the beneficial ownership of a local (to me) company suggested important local and national health care implications, and yet the case has remained anechoic. The case has some mysterious aspects. In September, the UK based Financial Times reported,The billionaire Sackler family, which has been blamed for fuelling the US opioid addiction epidemic, owns a second drugmaker that churns out millions of addictive painkiller pills every year, the Financial Times can reveal.The Sacklers are best known as the owners of Purdue Pharma, the privately held drugmaker that makes the now infamous opioid painkiller OxyContin, which has been described as ‘heroin in a pill’.However, an FT analysis of company registration documents has established that the family also owns Rhodes Pharma, a little-known Rhode Island-based drugmaker that is among the largest producers of off-patent generic opioids in the US. Furthermore,Rhodes Pharmaceuticals was set up in 2007, four months after Purdue pleaded guilty to federal criminal charges that it had mis-marketed OxyContin over the previous decade.The little-known company now makes several opioid-based products containing highly-addictive drugs such as oxycodone, morphine and hydrocodone, according to a US Food and Drug Administration database. Many of its drugs are made in factories owned by Purdue. The FT report was noted by our local on-line news site, GoLocalProv, which tried to find out more about the company. It reported, The marketing arm of the Rhodes Technologies is Rhodes Pharmaceuticals and it self-describes itself as ‘a privately held company headquartered in picturesque Rhode Island….developing and distributing quality pharmaceutical products since 2008.’ Emails and requests for an interview were not responded to by Rhodes Pharmaceuticals.
Drugs and syringes have become such a problem in Starbucks bathrooms that the company is installing needle-disposal boxes in certain locations - Starbucks is installing boxes for safe disposal of syringes in the bathrooms of certain locations, following workers' reports of discarded needles and sometimes concerning conditions. The coffee giant is exploring remedies after employees expressed fears about being pricked by uncapped needles and experiencing related health risks. Starbucks is testing solutions, including installing sharps-disposal boxes, using heavier-duty trash bags to prevent needle pokes, and removing trash cans from certain bathrooms."These societal issues affect us all and can sometimes place our partners (employees) in scary situations, which is why we have protocols and resources in place to ensure our partners are out of harm's way," Starbucks representative Reggie Borges told Business Insider. As of Wednesday, more than 3,700 people have signed a petition on Coworker.org, calling for Starbucks to place needle-disposal boxes in high-risk bathrooms.
23AndMe’s Pharma Deals Have Been the Plan All Along - Wired - Since the launch of its DNA testing service in 2007, genomics giant 23andMe has convinced more than 5 million people to fill a plastic tube with half a teaspoon of saliva. In return for all that spit (and some cash too), customers get insights into their biological inheritance, from the superficial—do you have dry earwax or wet?—to mutations associated with disease. What 23andMe gets is an ever-expanding supply of valuable behavioral, health, and genetic information from the 80 percent of its customers who consent to having their data used for research. So last week’s announcement that one of the world’s biggest drugmakers, GlaxoSmithKline, is gaining exclusive rights to mine 23andMe’s customer data for drug targets should come as no surprise. (Neither should GSK’s $300 million investment in the company). 23andMe has been sharing insights gleaned from consented customer data with GSK and at least six other pharmaceutical and biotechnology firms for the past three and a half years. And offering access to customer information in the service of science has been 23andMe’s business plan all along, as WIRED noted when it first began covering the company more than a decade ago. But some customers were still surprised and angry, unaware of what they had already signed (and spat) away. GSK will receive the same kind of data pharma partners have generally received—summary level statistics that 23andMe scientists gather from analyses on de-identified, aggregate customer information—though it will have four years of exclusive rights to run analyses to discover new drug targets. Supporting this kind of translational work is why some customers signed up in the first place. But it’s clear the days of blind trust in the optimistic altruism of technology companies are coming to a close.
CDC says it's another severe flu season with up to 7.3 million people sick so far - Flu seasons have been particularly severe in recent years and this one in no different. An estimated 6.2 million to 7.3 million people in the United States have been sick with the flu since October, federal health officials said Friday. At least half of those people have sought medical care for their illness and 69,000 to 84,000 people have been hospitalized during the Oct. 1 to Jan. 5 period, the Centers for Disease Control and Prevention estimated. This is the first time the CDC has provided such flu estimates for the 2018-2019 season. The estimates are extrapolated from data from about 27 million people, or about 8.5 percent of the U.S. population, federal health officials said. The CDC wouldn't provide data on how many people have died from flu-like illness so far this season, adding it will do so once "there is sufficient data to support a more precise estimate for that outcome." The flu season typically runs from October to as late as May, with activity tending to peak between December and February, according to the CDC. The agency recommends getting vaccinated early, ideally by the end of October, before the flu starts spreading. Thirty-seven percent of U.S. adults were estimated to have been vaccinated last flu season, down 6 percentage points from the previous year, according to the CDC. It estimates that the flu killed more than 80,000 people and caused more than 900,000 hospitalizations last year.
Routine FDA Food Inspections Suspended by Shutdown --Americans only just survived the great romaine lettuce scare of 2018, and now the U.S. Food and Drug Administration (FDA) has postponed routine domestic food safety inspections due to the partial federalgovernment shutdown, the agency's commissioner said on Wednesday.FDA commissioner Scott Gottlieb tweeted that the agency usually conducts about 160 domestic inspections on manufacturing and food processing plants each week. About a third of that inventory are foods considered at high risk for causing foodborne illnesses, such as seafood, dairy products, fruits and vegetables. The ongoing government impasse, however, has postponed much of these inspections. "It's not business as usual, and we are not doing all the things we would do under normal circumstances. There are important things we are not doing," Gottlieb told NBC News. The FDA oversees the manufacturing and distribution of the vast majority of the nation's food, pharmaceuticals and other consumer products.About 41 percent the agency's 17,000 employees are currently furloughed due to the shutdown, according to NBC News.Gottlieb told The New York Times he wants to bring back 150 inspectors by next week to restore food safety surveillance, especially at high-risk domestic facilities, but he was not sure how to do it. "These are people who are now furloughed and can collect unemployment insurance or take a second job," he explained to the newspaper. "If we pull them in and tell them they have to work, they can't collect. I have to make sure I'm not imposing an undue hardship."
There’s a Toxic Weedkiller on the Menu in K-12 Schools Across the U.S. - Glyphosate is the most widely used pesticide in the U.S. Its use has skyrocketed during the last 20 years because of the popularity of genetically-modified crops that are tolerant of this weedkiller. Health concerns about glyphosate have also skyrocketed since 2015, when the World Health Organization evaluated its ability to cause cancer. The above graph was created by the Center for Environmental Health using data from the study "Trends in glyphosate herbicide use in the United States and globally" by Charles M. Benbrook. Glyphosate's evaluation as a probable carcinogen is scary and was recently validated by a jury that awarded a school groundskeeper a multimillion-dollar judgment against Monsanto/Bayer because he had developedcancer after years of Roundup use. The decision has paved the way for thousands of other cancer patients and families to seek justice and compensation in court.Glyphosate is now in most of us: Recent biomonitoring studies have detected it in the urine samples of 70 to93 percent of the U.S. population.Even scarier, recent research has demonstrated that glyphosate can disrupt our body's hormones, those vital molecules that manage growth, development, behavior, sex and more.Exposing children, with their developing bodies, to a chemical that can cause cancer and hormone dysfunction is wrong. It's especially wrong for children simply eating breakfast at school, who often are from low-income families. This fact has spurred the nonprofit Center for Environmental Health (CEH), where I serve as the senior scientist, to measure glyphosate contamination in breakfast cereals and bars served at schools. Although our study was small, the results were striking. We found significant contamination in 70 percent of the products we tested, including big name brands like Quaker, whose glyphosate contamination was more than six times the safety threshold developed by the Environmental Working Group (EWG) and Cheerios, whose glyphosate contamination was more than five times the EWG safety threshold.Our findings corroborate a growing list of recent studies demonstrating the presence of glyphosate in children's foods, including preliminary findings by CEH in August, as well as those by the EWG, Moms Across America, Food Democracy Now and the Food and Drug Administration.
Russia’s GMO debate looks a lot like America’s – with more geopolitics - When faced with something new, Russian lawmakers have generally found it easier to ban it than to debate it, even if such prohibitions often prove dysfunctional in the long run. A case in point: Russia’s legislation banning any production of genetically modified organisms (GMOs), which was nominally implemented in order to keep Russia's food supply “pure.” The passage two years ago of the law, which prohibits “cultivation of genetically engineered plants and breeding of genetically engineered animals on the territory of the Russian Federation,” had a practical side, mainly to protect Russia’s slowly reviving agricultural sector from becoming dependent on seeds produced by big US biotechnology firms like Monsanto. And in follow-up legislation in late 2018, Russia’s parliament ordered detailed labeling for any products containing GMOs – as many foreign imports still do – in the name of consumer transparency. The law has strong public support, even if opposition to it is rife in Russia’s scientific community. But, as in other cases where Russia has taken a vocal, single-minded official stand, the anti-GMO measures have been framed as a rejection of “degenerate” Western practices and an upholding of Russian values. Inevitably, they have become a bone of East-West ideological contention, with some in the US accusing Russia of anti-GMO “disinformation” meant to undermine confidence in American farming, which is the world’s leading producer of genetically engineered crops. “There have been a lot of pseudo-documentary films shown on Russian TV that give the idea GMOs are bad, that they cause disease or something like that,” says Alexander Panchin, a computational biologist at the official Institute of Information Transmission Problems, which studies the way information is passed – or fails to pass – through systems. “Anti-GMO advocates do get a lot of media attention in Russia.... Maybe part of the idea is that GMOs come from the West, and they are our enemies.”
U.S. Taxpayers on the Hook for Insuring Farmers Against Growing Climate Risks -- Like every Midwestern farmer, Jerry Peckumn relies on a few things going right every season. Rain, but no deluge. Sunshine, but no heat wave. A timely cycling of the seasons.Peckumn is a progressive, conservation-minded farmer who's deeply concerned about the impact of the changing climate on his farm. He knows nature isn't controllable and the weather is getting more erratic. So, like hundreds of thousands of American farmers, he relies on federal crop insurance."I'd quit farming if I didn't have crop insurance," Peckumn said, sitting at his kitchen table in central Iowa this summer, surrounded by corn and soybeans in every direction. As climate change stokes more extreme weather, American farms will depend on insurance even more. And as they do, the insurance system will exacerbate the risks of global warming, imposing lasting consequences on the nation's agricultural production, the global food supply and the climate itself. "The current U.S. crop insurance program encourages farmers to adopt production practices that will not be sustainable in the face of climate change, and in the short term contribute to greenhouse gas emissions," said Vincent Smith, an agricultural economist at Montana State University who has written extensively about the crop insurance program. "Crop insurance encourages people to adopt production practices that are riskier, and by definition, reduce resiliency."
Undercover Investigations Will Be Legal Again at Iowa Animal Farms - On Thursday the U.S. District Court for the Southern District of Iowa struck down the Iowa Ag-Gag law, holding that the ban on undercover investigations at factory farms and slaughterhouses violates the First Amendment. In 2017, a coalition of animal, environmental and community advocacy groups, including Center for Food Safety, challenged the law's constitutionality. Federal courts have similarly struck down Ag-Gag laws in Idaho and Utah as unconstitutional.Iowa's Ag-Gag law criminalizes undercover investigations at a broad range of animal facilities including factory farms, puppy mills and slaughterhouses; preventing advocates from exposing animal cruelty, environmental harm, workers' rights infractions and food safety violations. The law achieved its goal of suppressing undercover investigations—no investigations have taken place since the law's passage in 2012."Ag-Gag laws unconstitutionally allow Industrial Ag to hide in the darkness, and today's decision is another important pulling back of that curtain," said Andrew Kimbrell, executive director of Center for Food Safety. "This decision is a victory for all those who support humane treatment of farm animals and safe food." For more than a century, the public has relied on undercover investigations to expose illegal and cruel practices on factory farms and slaughterhouses. No federal laws govern the conditions in which farmed animals are raised, and laws addressing slaughter and transport are laxly enforced. Undercover investigations are the primary avenue through which the public receives information about animal agriculture operations.
Guatemalan farms shift to palm oil, fueling family migration (Reuters) - In the poor, hot region of Guatemala that was home to a seven-year-old migrant girl before she died in U.S. border custody last month, palm oil cultivation is taking over from subsistence farming, adding to pressure on people to leave. Many villagers around the municipality of Raxruha have sold land to palm oil producers, residents and local officials say, helping to make Guatemala one of the world’s biggest exporters of the versatile product in the space of just a few years. Supporters of the industry say it has created jobs and investment in an area where poverty and violence have long been the main drivers of migration. But critics say farmers have given up land that long fed them, with many then entering a state of co-dependency with palm oil companies that have become major employers, but do not pay well enough to stop people migrating. Cesar Castro, Raxruha’s mayor, said money raised from land sales had been used to pay people smugglers, a major factor in a surge in families leaving Guatemala. “These people get the money, and they go to the United States, and the vast majority come back to find more poverty and end up employed as workers on their own land,” Castro said. More than 50,000 Guatemalans were apprehended in family groups at the U.S.-Mexico border in the 2018 fiscal year, more than double the year before, U.S. government data shows. Most get deported. Jakelin Caal, who died in U.S. custody after succumbing to a fever, left Raxruha with her father because he was struggling to earn enough to support his family as a corn farmer, relatives said. Smugglers tell families that having children with them can make it easier to enter the United States. While her father had not sold his land, others in the family have worked on palm plantations that surround their village. Dorrian said he earned 60 quetzales ($7.80) a day working from 6 a.m. to 6 p.m. last year for local producer Industria Chiquibul, which has been listed as a supplier by international commodities purchasers including ADM and Cargill .
Fortnite Creator Buying Thousands of Acres of Forest to Stop It From Being Cut Down — Creator of the online video game Fortnite, Tim Sweeney, is best known for founding the video and 3-D software company Epic Games in the 1990’s. In addition to these popular gaming titles, the billionaire philanthropist has made good on his promise to protect undeveloped and bio-diverse land in the picturesque western Carolina mountains for future generations.Since 2008, Sweeney has spent millions on conservation projects in his home state of North Carolina to protect and preserve its forest land. He has purchased nearly 40,000 acres over the last decade, making him one of the largest private land owners in the state. Sweeney has also donated money to several conservation parcel projects, including a 1,500 acre expansion to Mount Mitchell State Park.In November 2016, Sweeney donated $15 million for a conservation easement to protect 7,000 acres of the The Box Creek Wilderness. The forest, located in the foothills of the Blue Ridge Mountains, had been targeted by a company that wanted to carve up the land and run power lines through it. By purchasing the land, Sweeney helped protect hundreds of endangered plant and animal species.According to Biologist Kevin Cadlwell, “ecologists documented more than 130 rare and watch-list plant and wildlife species, and several new-to‐science wildlife and plant species, including three moths and a new spiderwort species.”
A Mysterious Leaf Disease Is Killing Beech Trees—and It's Spreading - lf you've seen lovers' initials carved in a tree, it's probably a beech. The iconic species—known for its smooth, delicate bark—is not just a favorite canvas for bark carvers, they provide shelter and food for a large range of wildlife, including birds, squirrels and bears. But scientists are raising flags on a mysterious, deadly and rapidly spreading beech leaf disease that's been described as "an emerging forest epidemic."The disease (Fagus grandifolia) was first discovered in 2012 on beech trees in northeast Ohio and has since spread to forests in 10 counties in Ohio, eight counties in Pennsylvania and five counties in Ontario, Canada, according to a study published last month in the journal Forest Pathology. Early symptoms of the disease are characterized by dark green banding on the leaves between the veins. Later symptoms are characterized by solidly darkened leaves that are shrunken and crinkled. The symptoms then seem to progress through the buds, causing them to fall off and produce no new leaves. The affected tree eventually dies. As the North American beech is native to the eastern United States, the researchers "fear this disease has the potential to drastically alter the Eastern deciduous forests of the United States on its own and through potential compounding disease effects," the study states. The study was authored by researchers and naturalists from Ohio State University and metroparks in northeastern Ohio.
Monarch Butterfly Numbers Plummet 86 Percent In California – The number of monarch butterflies turning up at California's overwintering sites has dropped by about 86 percent compared with only a year ago, according to the Xerces Society, which organizes a yearly count of the iconic creatures.That’s bad news for a species whose numbers have already declined an estimated 97 percent since the 1980s.Each year, monarchs in the western United States migrate from inland areas to California’s coastline to spend the winter, usually between September and February. “It’s been the worst year we’ve ever seen,” “We already know we’re dealing with a really small population, and now we have a really bad year and all of a sudden, we’re kind of in crisis mode where we have very, very few butterflies left.” Results from the count so far show that the number of monarchs at 97 California overwintering sites has dropped from around 148,000 in 2017 to just over 20,400 this year. Counts for dozens of other sites are still being tabulated, but the outlook is troubling, Pelton said. Experts believe the decline is spurred by a confluence of unfortunate factors, including late rainy-season storms across California last March, the effects of the state’s yearslong drought and the seemingly relentless onslaught of wildfires that have burned acres upon acres of habitat and at times choked the air with toxic smoke. The Thomas Fire last year burned almost 300,000 acres, including areas important for monarch breeding and migration, Pelton said. More recently, the Woolsey Fire damaged at least four monarch butterfly overwintering sites in the Malibu area, according to Lara Drizd, a wildlife biologist with the U.S. Fish and Wildlife Service in Ventura.
George, reclusive Hawaiian snail and last of his kind, dies at 14 - George, the last known Achatinella apexfulva, a Hawaiian land snail, died on New Year's Day. Hawaii Department of Land and Natural Resources George, the last of his species of Hawaiian land snail, died on New Year's Day. He was approximately 14 years old. His death was confirmed by Hawaii's Department of Land and Natural Resources. George was born as part of a last-ditch effort to save his species. Back in 1997, the last 10 known Achatinella apexfulva were brought into a University of Hawaii lab to try to increase their numbers. Some offspring resulted, but all of them died except for George. As the last remaining A. apexfulva, George lived out his days alone in a cage at DLNR's snail lab in Kailua, Oahu, alongside 30 other species close to extinction. Those who knew George say he kept to himself. "For a snail he was a little bit of a hermit," David Sischo, a wildlife biologist with the Hawaii Invertebrate Program, tells NPR. "I very rarely saw him outside of his shell." Sischo said George likely died of old age, as 14 is "up there in snail years." While those who knew George use male pronouns to talk about him, George was a hermaphrodite. With both male and female parts, some snails can reproduce without a partner. But seemingly not A. apexfulva: George leaves no survivors.
This GIF shows how far the 100th Meridian has shifted since 1980 - Climate change works in mysterious ways; it isn’t limited to wildfires and melting ice. Today’s climate exhibit: The 100th Meridian — the famous dividing line that separates America’s wet East from the dry West — has migrated 140 miles east since 1980.The boundary passes through North Dakota, South Dakota, Nebraska, Kansas, Oklahoma, and Texas — America’s breadbasket. Once you cross the divide, the rain-soaked grasses of the East turn into dusty plains, with the occasional cactus dotting the landscape.“Passing from east to west across this belt a wonderful transformation is observed,” remarked John Wesley Powell, famous explorer of the West, in 1890. The conservationist was the first to mark the transition line, which became known as “100th Meridian” because it closely follows the 100th meridian of longitude (a vertical line that stretches from the North to South Poles). But we may have to change the line’s name someday. The shift is the result of rising temperatures drying out parts of the northern plains and less rain falling further south, YaleEnvironment360 reports. This could be due to natural variability — changes caused by nonhuman forces — but the migration aligns with what researchers tell us to expect from global warming.
Wettest-Year Records for 2018, Take Two - Weather Underground --In a post on December 29, we noted a number of U.S. cities that had already secured their wettest year on record. Now that 2018 is a wrap, it’s time to circle back and see how the final totals turned out. Here are some of the larger towns and cities that notched records for 2018, as tallied by weather.com based on data from NOAA and the Southeastern Regional Climate Center. All of these locations have at least a 60-year period of record, and some of the records broken were truly long-standing, including Washington, D.C. (129 years) and Wilmington, North Carolina (141 years). Many of the records were smashed by impressive margins of 5" or more. See the weather.com article for additional background on this very wet year. (see embedded list of cities) If we expand the roster of observing sites to include those with shorter periods of record, then more than 100 U.S. locations had their wettest year on record, according to The Weather Channel. You can zoom in on various U.S. regions to find those cities by using the online Perspectives tool, created by the Southeast Regional Climate Center. By clicking on each site, you can view the local records and periods of record. For the period January through November, every state east of the Rockies was wetter than average, and eight states had their wettest Jan.-to-Nov. period on record. We can expect at least some of these states to end up with records for the year as a whole when NOAA’s National Centers for Environmental Information publishes the final data for 2018. Note that the NOAA/NCEI website is offline indefinitely because of the government shutdown.
Heatwave wilts Australia's southeast, fanning fire, health concerns - (Reuters) - A heatwave sweeping Australia engulfed the densely-populated southeast on Friday, boosting temperature records, spurring fire bans and arousing concern about the health of contestants in this month's tennis Open. A week after Australia's hottest town, in its northwest, recorded its hottest day, sweltering temperatures arrived on the other side of the continent, pushing the southeastern city of Melbourne to a near-record 42 degrees Celsius (107.6 F). Regions to the north were expected to be hotter and windy, prompting a fireban across the second most populous state of Victoria. Nine years earlier, Australia's deadliest bushfires killed 180 people near cities forecast to experience tenmperatures of 46 C (115 F) on Friday. "The conditions are there that if a fire was to start, it could be quite difficult to contain," said Tom Delamotte, a Bureau of Meteorology forecaster. Forecasters expected temperatures to cool later but the heat was likely to return soon after, Delamotte added, days ahead of the Jan. 14 start of the Australian Open in Melbourne. Tennis Australia, the sport's governing body, says it has upgraded temperature testing at the Melbourne Park sports centre and introduced a 10-minute break for the men's singles. It has also adopted a five-step "heat stress scale" that lets referees suspend play under extreme conditions. In Hobart, capital of the nearby island state of Tasmania, which is usually the country's coolest, the mercury rose as high as 40 C (104 F), two degrees from a January record. Pictures on social media showed a striking dark-orange sky over Hobart as a bushfire swept the wilderness nearby. Campers were evacuated from the affected area, the Australian Broadcasting Corp. said, though no injuries were reported. The city council of Shepparton, north of Melbourne, sent life guards to ask holidaymakers to avoid the direct sun at the city pool during January record temperatures of 45 C (113 F).
As Lahore chokes on winter smog, Pakistan moves to cut air pollution - Pakistan's second-largest city is choking on smog, driven in part by smoke from bricks kiln and steel mills, burning of rice stubble and garbage, growing numbers of vehicles on the road and large-scale losses of trees as the expanding city makes way for new roads and buildings, residents say. Many in the city of 11 million complain of headaches and burning eyes and throats as air pollution levels this winter have on some days hit five times the legal limit, according to a global air quality index that many in Lahore check via the AirVisual phone app. "I don't send my daughter to school," environmental lawyer Rafay Alam admits. "I am not going to risk permanent damage to her lungs." Alam thinks it's time for the government to declare a public health emergency on the worst days, when the air is full of dust and pollutants that can cause health issues including asthma, lung damage, bronchial infections and heart problems. "The air pollution in Lahore is bad throughout the year, but in the winter there is temperature inversion where a layer of warm air is prevented from rising and it traps all the pollutants below it, which renders them visible," he said. Lahore, once known as the Garden City but now choked with cars, regularly figures on air quality indexes as as one of the most polluted cities in the world - and many of the pollutants are also drivers of climate change.
The Storm Moved on, But North Carolina’s Hog Waste Didn’t -- It's been nearly four months since Hurricane Florence battered the North Carolina coast, dumping 9 trillion gallons of water on the state in the span of four days. In Duplin County, home to the nation's largest concentration of industrial hog operations, the storm's deluge laid bare problems that persist in good weather and in bad. Since 1999, at least four hurricanes and tropical storms have brought enough precipitation to North Carolina to qualify as "100-year" storms. There is barely time to rebuild and recover before the next storm hits. The flooding caused by these hurricanes exacerbates problems caused by the failure of industrial hog operations, also known as concentrated animal feeding operations (CAFOs), to adequately store or maintain the massive amounts of waste produced by the 2.2 million hogs in Duplin County alone. Each year, CAFOs in Duplin County produce twice as much urine and feces as the entire New York City metro area. Much of that waste is stored in thousands of hog "lagoons"—open-air pits clustered in the area hardest hit by Hurricane Florence. When it rains too much, these poop-filled pits—which carry E. coli, salmonella, cryptosporidium, and other harmful bacteria – overflow into surrounding rivers and streams, or sustain catastrophic structural damage. As a result of Hurricane Florence, 49 lagoons were reported to be damaged structurally, actively discharging material, or inundated with surface water, while another 60 nearly flooded, according to the state's Department of Environmental Quality. When all this pig poop is unleashed on the surrounding environment, local residents, who are disproportionately African American, Latino or Native American, live with the consequences—which begin with contaminated drinking water. A recent article in the News & Observer notes that several hundred samples of private well water analyzed by the state Laboratory of Public Health showed a marked increase in E. coli after Hurricane Florence. In fact, 14.9 percent of the wells tested positive for E. coli and fecal coliform bacteria—as compared to 2 percent that tested positive in the months before the hurricane hit. Out of all 50 states, North Carolina ranks second in number of people who rely on private wells for drinking water.
Florida Gov. DeSantis Signs Order to Fight Algae, Red Tide - . (AP) — Republican Gov. Ron DeSantis began following up on a campaign promise to make the environment a priority by signing an order Thursday seeking to tackle Florida's problems with blue-green algae in its rivers and red tide off its coast. DeSantis signed the order in Bonita Springs in southwest Florida, one of the areas where slimy algae have coated waterways because of pollutants flowing downstream from Lake Okeechobee. DeSantis said he will seek $2.5 billion over the next four years for Everglades restoration and water resources. The order not only touches on algae problems, but rising sea levels and the ongoing battle with Georgia over water diverted for Atlanta's use instead of flowing downstream to Apalachicola Bay. The reduction of fresh water entering the bay has hurt the region's oyster industry. He didn't say where the money would come from, and his office didn't immediately respond when asked about the funding. Late in the day, DeSantis demanded the resignations of all nine members of the South Florida Water Management District, which oversees the Everglades area. The board in November extended a lease with sugar farmers for land needed for a reservoir that is key to water purification efforts, angering DeSantis. While critics often said DeSantis' predecessor, U.S. Sen. Rick Scott, ignored science and rising sea levels, DeSantis addressed it on his second full day in office. He is creating an Office of Resiliency tasked with protecting coastal communities and wildlife from sea level rise.
A fatberg longer than the Leaning Tower of Pisa is clogging another UK sewer - Imagine holding a massive, squishy beach ball, except instead of colorful plastic, the ball is made of used condoms, wet wipes, crude oil, and congealed cooking fat from people's morning bacon. That's a fatberg, and it's what sewer workers in London encounter with regularity.In 2017, a 150-ton, 820-foot-long fatberg was discovered in the sewers beneath east London. A piece of that record-breaking fatberg was put on display in the Museum of London, where it then started growing toxic mold pustules and even hatched flies. The Thames Water Authority told the AFP in 2014 that it saw nearly 80,000 fatberg clogs annually, which cost $1.6 million per month to get rid of. Almost 7,000 water authority customers experienced flooding as a result of these blockages. Now, a 210-foot-long fatberg has been found blocking a sewer in Sidmouth, England, a small coastal town. The blockage is longer than the Leaning Tower of Pisa, stretching more than six buses would if lined up end to end.A team from South West Water, the company that provides drinking water and wastewater management throughout Devon, England, is now figuring out how to remove the blockage. Andrew Roantree, a worker with South West Water, told the Associated Press that it will take the crew "around eight weeks to dissect this monster in exceptionally challenging working conditions." The removal is scheduled to start February 4, but could be delayed due to heavy rain, according to a statement from South West Water. The statement also encouraged consumers to "stop the block by only flushing the 3Ps — pee, paper, and poo — and by not pouring fat, oil, and grease (FOG) down the drain." South West Water noted that the fatberg "has been discovered in good time," so didn't impact the quality of local tap water.
'Appalling' toilets and rule-breaking as US shutdown hits national parks - Human waste by the side of a busy road in Yosemite. Overflowing toilets in the Grand Canyon. The Rocky Mountains inaccessible because of unplowed roads. And in all these places, ordinary people stepping in to try to save some of America’s most revered landmarks from being overrun. As the impasse over funding for Donald Trump’s border wall pushes the government shutdown into its third week, US national parks are bearing the brunt of the financial crunch. The vast majority of park service staff are furloughed during one of of the busiest times of the year, particularly in the western US. Campers and hikers who might have been pleased to skip the entry fees into unstaffed parks have been welcomed by shuttered visitor centers, locked bathrooms, and garbage cans brimming over. Many have lost the reservations they had booked months or even years in advance. At least three people have died in the parks since the shutdown began, the Washington Post reported. Two people fell, one at the Horseshoe Bend overlook in Arizona and the second in Yosemite; another was hit by a falling tree in Great Smoky Mountains national park. It is unclear if the deaths are related to the shutdown, but experts said the staffing shortage made visits potentially more dangerous. A park service spokesman told the publication that an average of six people die each week in the parks.
As Shutdown Drags on, National Parks Will Use Entrance Fees to Take Out Trash - As the government shutdown continues into a third week, the Interior Department has made the controversial and unprecedented decision to use visitor fees collected at national parks to help deal with the maintenance and safety issues that have emerged as iconic public lands remained open but understaffed when the government failed to pass a budget in December, The Washington Post reported."We are taking this extraordinary step to ensure that parks are protected, and that visitors can continue to access parks with limited basic services," National Park Service (NPS) Deputy Director P. Daniel Smith wrote in the NPS statement announcing the plan Sunday.The unusual decision, formalized by a memorandum signed by acting Interior Secretary David Bernhardt Saturday, authorizes park managers to use entrance fees to pay staff to clean restrooms, remove trash, patrol parks and reopen areas closed to tourists during the shutdown, The Washington Post reported. The Trump administration had broken with past precedent by deciding to keep the parks open to the public while a majority of their staff has been furloughed. When shutdowns took place during the Clinton and Obama administrations, the parks had closed their gates. The decision to keep them open has put the safety of wildlife and visitors at risk as trash and waste piles up and unsupervised guests endanger protected habitats.
Joshua Tree will temporarily close to address shutdown damage - California’s Joshua Tree National Park will completely shutter Thursday so that officials can address damage wrought during the ongoing government shutdown. The 790,636-acre park between Palm Springs and Joshua Tree in southern California has felt the effects of the government shutdown that started Dec. 22, which left the park unattended because workers could not work. The park is experiencing overflowing trash cans, clogged toilets, and destruction of habitat. While the shutdown furloughed park rangers and suspended basic amenities such as trash collection and road clearing, the Trump administration opted to leave gates open so that the public could continue to visit. The National Park Service (NPS) announced in a press release Tuesday that the park will temporarily close beginning Thursday in order to “to allow park staff to address sanitation, safety, and resource protection issues in the park that have arisen during the lapse in appropriations.” Officials say the park will be reopened “in the coming days.” Government employees will pay for the maintenance needs by pulling from funds collected through park entrance fees. While maintenance workers will be paid through those coffers, other essential NPS staff--such as law enforcement officers--will still not be paid, due to the shutdown.
Joshua Tree national park announces closure after trees destroyed amid shutdown -For 17 days, a host of volunteers and a skeleton staff kept the trash cans and toilets from overflowing at Joshua Tree national park.But on Tuesday, 18 days after the federal government shutdown furloughed the vast majority of national park staff, officials announced that vandalism of the park’s distinctive namesake plants and other maintenance and sanitation problems will require closure starting Thursday. “While the vast majority of those who visit Joshua Tree do so in a responsible manner, there have been incidents of new roads being created by motorists and the destruction of Joshua trees in recent days that have precipitated the closure,” spokesman George Land said in a news release.Land told the Los Angeles Times that, with only eight rangers currently overseeing the nearly 800,000 acre park, the gates would likely remain closed until the shutdown ends. But a different spokesman for the National Parks Service, Mike Litterst, subsequently told the Times that the park may not close after all if staff are able to complete cleanup work before Thursday. National Park Service officials did not immediately respond to requests for clarification.
Off-Roading, Chopped Joshua Trees, Overflowing Toilets: Our National Parks During a Shutdown -- Ever wanted to cut down an iconic Joshua tree in order to create space for some off-roading? No? Well, we thank you. But during the government shutdown, some fine folks did just that. National parks are filling with garbage, and not just the kind that comes in trash bags. Since the government shut down 20 days ago, Joshua Tree, which is about the size of Delaware and located two hours east of Los Angeles, has been forced to reduce its number of rangers from 100 to only eight. The lack of staff is making it difficult to keep up with the mayhem that is illegal off-roading and road creation, damage of federal property, overflowing garbage and toilets, out-of-bounds camping, and the chopping down of literal Joshua trees. During the shutdown, with Joshua Tree National Park open but no staff on duty, visitors cut down Joshua trees so they could drive into sensitive areas where vehicles are banned.“We had some pretty extensive four-wheel driving.” https://t.co/EbSB4bF8hKpic.twitter.com/8kVFClVqxZ— John Upton (@johnupton) January 10, 2019And it isn’t just Joshua Tree bearing the brute force of the barbaric human. Reports have been surfacing of human waste and trash pile-up in a number of national parks, from Yosemite to Death Valley.“I think there are a number of things that are not very obvious to the general public, like the trash and toilets [are], that are pretty consequential when you have a shutdown,” National Park Service Director Jon Jarvis told the the National Parks Traveler.While the sight of overflowing waste and cut Joshua trees is shocking (and quite frankly repulsive), there is also major damage happening out-of-sight. The longest-running research initiative in the Shenandoah National park — 200,000 acres in the mountains of Virginia — has come to a grinding halt during the government shutdown. The study examines the impact of acid rain in the mid-Atlantic forests, and the research has been used to understand the effects of air pollution on natural systems. No big deal, unless you like breathing clean air.
Joshua Tree National Park Will Stay Open After All - Joshua Tree National Park will not shut its gates after all as it works to recover from the effects of the ongoing government shutdown, the park announced Wednesday. "By immediately utilizing revenue generated by recreation fees, National Park Service officials have been able to avert a temporary closure of Joshua Tree National Park that had been previously scheduled for January 10," the park said in a statement.The park had originally said it would close temporarily in order to repair damage done to the unique desert ecosystem by unsupervised visitors who had created new roads and destroyed the protected Joshua trees. Instead, the park remained open and even restored access to campgrounds that had been closed early in the month when toilets reached capacity.The park was able to avoid closing because of a controversial Interior Department decision to allow parks to use visitor fees to address the maintenance and safety issues that have arisen as the parks remained open to the public while a majority of their staff has been furloughed. "National Park Service officials have determined that by using Federal Land and Recreation Enhancement funds to immediately bring back park maintenance crews to address sanitation issues, the park will be able to maintain some visitor services, including reopening the campgrounds. The park will also bring on additional staff to ensure the protection of park resources and mitigate some of the damage that has occurred during the lapse of appropriations," Joshua Tree said.
Three dead in national park system accidents as shutdown wears on - Three days after most of the federal workforce was furloughed on Dec. 21, a 14-year-old girl fell 700 feet to her death at the Horseshoe Bend Overlook, part of the Glen Canyon Recreation Area in Arizona. The following day, Christmas, a man died at Yosemite National Park in California after suffering a head injury in a fall. On Dec. 27, a woman was killed by a falling tree at Great Smoky Mountains National Park, which straddles the borders of North Carolina and Tennessee. The deaths follow a decision by Trump administration officials to leave the scenic — but sometimes deadly — parks open even as the Interior Department has halted most of its operations. During previous extended shutdowns, the National Park Service barred public access to many of its sites across the nation to substantially decrease the risk of park damage and visitor injury. National Park Service spokesman Jeremy Barnum said in an interview that a total of seven people have died in national parks since the shutdown began. Officials believe that four of the deaths were suicides, he added. An average of six people die each week in the park system, he said, a figure that includes accidents like drownings, falls, and motor vehicle crashes, natural causes such as heart attacks and suicides. Drowning, automobile accidents, falls and suicides are among the top causes of death at national parks. In 1995 and 2013, respectively, the Clinton and Obama administrations made the decision to close the parks altogether. Officials concluded that keeping the parks open would jeopardize public safety and the parks’ integrity, but the closures also became a political cudgel for Democrats because they exemplified one of the most popular aspects of federal operations that had ground to a halt.
Oregon begins killing sea lions after relocation fails (AP) — Oregon wildlife officials have started killing California sea lions that threaten a fragile and unique type of trout in the Willamette River, a body of water that’s miles inland from the coastal areas where the massive carnivorous aquatic mammals usually congregate to feed. The state Department of Fish and Wildlife obtained a federal permit in November to kill up to 93 California sea lions annually below Willamette Falls south of Portland, Oregon, to protect the winter run of the fish that begin life as rainbow trout but become steelhead when they travel to the ocean. The adult male sea lions, which weigh nearly 1,000 pounds (454 kilograms) each, have learned that they can loiter under the falls and snack on the vulnerable steelhead as the fish power their way upriver to the streams where they hatched. The trout travel to sea from inland rivers, grow to adulthood as steelhead in the Pacific Ocean and then return to their natal river to spawn. They can grow to 55 pounds and live up to 11 years. The sea lions breed each summer off Southern California and northern Mexico, then the males cruise up the Pacific Coast to forage. Hunted for their thick fur, the mammals’ numbers dropped dramatically but have rebounded from 30,000 in the late 1960s to about 300,000 today because of the 1972 Marine Mammal Protection Act. With their numbers growing, the dog-faced sea lions are venturing ever farther inland up the Columbia River and its tributaries in Oregon and Washington — and their appetite is having disastrous consequences, scientists have said. Last winter, a record-low 512 wild winter steelhead completed the journey past the Willamette Falls, according to state counts. Less than 30 years ago, that number was more than 15,000. The sea lions are eating so many winter steelhead at Willamette Falls that certain runs are at a high risk of going extinct, according to a 2017 study by wildlife biologists. Wildlife officials moved about a dozen sea lions to the coast near the small city of Newport last year, but the animals ended up swimming back to the falls within days. So the state petitioned federal officials for permission to start killing the animals, which are listed as a federally endangered species.
EcoWatch Exclusive: Ocean Conservation Expert Carl Safina on the Tuna That Sold for $3 Million - Bluefin tuna made the news this week when a 612-pound specimen of the fascinating but vulnerable fish sold for a record $3.1 million at a New Year's auction at Tokyo's Toyosu fish market Saturday. The purchaser was Japanese sushi chain owner and self-proclaimed "Tuna King" Kiyoshi Kimura. But what do auctions like this mean for a fish whose Pacific population has declined by 96 percent over the last 400 years, as Al-Jazeera English reported in the clip shown below?EcoWatch spoke with renowned conservationist and writer Carl Safina to find out."The prices accorded these fish in Japan have long been insane," Safina told EcoWatch in an email. "The fish become an ego contest for wealthy restaurateurs one-upping each other to display their wealth. The higher the price, the more they devalue the actual fish as the magnificent wild creature that it is."Safina explained what made bluefin tuna so incredible."Bluefin tunas, largest and most wide-ranging of all tunas, are several species of warm-blooded, ocean-crossing giants that can travel at highway speeds and can weigh almost a ton," he wrote.However, the fish are in serious trouble throughout the world's oceans. In addition to their depletion in the North Pacific, they have been apparently wiped out in the South Atlantic due to overfishing. In the North Atlantic, they are at around 18 percent of their 1950 numbers, according to the International Commission for the Conservation of Atlantic Tuna.But the valuable bluefin are one of the world's most exploited fish, and their desirability has consequences. When management practices led to a resurgence in their Atlantic population, catch quotas were raised by 50 percent for 2017 to 2020, an article published in ScienceAdvances reported. "They are completely awesome creatures," Safina told EcoWatch. "If it was up to me, they would never be fished commercially or sold and they would be allowed to return to their former abundance and their role in nature."
WATCH: Poachers Ambush Sea Shepherd Vessel Protecting Nearly Extinct Vaquita --The environmental organization Sea Shepherd Conservation Society says its crew was attacked Wednesday by roughly 35 fishing boats inside a vaquita refuge in Mexico's Gulf of California.Sea Shepherd released a video showing fishermen shouting, hurling objects and trying to foul the propellors of the M/V Farley Mowat, a Sea Shepherd vessel used in campaigns against illegal fisheries activities.SEA SHEPHERD SHIP ATTACKED INSIDE VAQUITA REFUGE – YouTube The vaquita is the world's most endangered marine mammal, with only about a dozen left in their habitat in the Sea of Cortez, according to experts. The porpoises are not directly hunted but get entangled and drown in illegal gillnets set for capturing totoaba, a large and critically endangered fish that's prized for its swim bladder as a Chinese delicacy.The fishermen were participating in "obvious illegal poaching" of totoaba, according to a Sea Shepherd press release sent to EcoWatch. The video shows some of the skiffs carrying gillnets, even though they are banned within the vaquita reserve.Sea Shepherd said:The poachers attacked by hurling leadweights, anchors, trash, dead fish and even Tabasco sauce at the vessel and its wheelhouse windows in addition to threatening ship's crew with Molotov cocktails, spraying gasoline at the ship and pouring gas in the sea around the vessel.The video also shows the crew on the Farley Mowat using a hose to repel some of the boats.Sea Shepherd said that while its vessel was temporarily immobilized after the propeller fouling, five fishermen boarded the ship and looted multiple objects from the deck."During the illegal boarding, the Sea Shepherd crew was able to keep the poachers from entering into the ship, and used an emergency firehose to repel the boarders, while waiting for naval forces to arrive," the press release said. "At this time a Mexican Naval Helicopter made several passes above the scene and the skiffs began to disperse."The vessel's captain was eventually able restart the engines and headed to the port of San Felipe where the ship was met by the regional Navy Commander and reinforcements, according to Sea Shepherd. Sea Shepherd conducts maritime patrols inside the vaquita refuge and had recovered three illegal gillnets in the morning before the attack. The group's operations are conducted with the knowledge and cooperation of the Mexican government to help detect illegal fishing activities, the Associated Press noted.
Jellyfish sting more than 5,000 holidaymakers on Queensland's coast -- More than 5,000 people were stung by bluebottles on Queensland’s Gold and Sunshine coasts over the weekend as weather drove a wall of jellyfish onto the shore. Conditions eased on Monday but remnants of the bluebottle armada (the correct term for a bunch of bluebottles) still dot the beaches and more than 200 people were treated for stings, mostly at the Sunshine Coast. The latest figure for the weekend is almost double initial estimates released by Surf Life Saving Queensland and includes people treated by council lifeguards. Across Queensland, but mostly in the south-east, 22,282 people sought treatment for bluebottle stings between 1 December and 7 January compared with 6,831 in the same period last year. That was a “hell of a lot” of people stung, Australian Marine Stinger Advisory Service director Lisa-ann Gershwin said. “That is unusual,” she said. “The numbers I have seen published are 25,000 to 45,000 per year for the whole of Australia. “Those figures, the 22,282, are for about five weeks and that’s just one teeny tiny smidgin of Australia, so that is a lot.” Thousands were treated by lifesavers and several people reportedly suffered anaphylactic shock and were treated by paramedics. In a matter of hours on Sunday, 476 bluebottle stings were treated on the Gold Coast and 461 on the Sunshine Coast. Unusually strong north-easterly swell conditions pushed the bluebottles onshore. Gershwin said the striking blue jellyfish lived in armadas in the middle of the ocean and had trailing tentacles and a keel-like crest that acts like a sail. “When you look at a bluebottle, and you see the bubble and the blue fringes and the long blue tentacles, that is actually a colony, that is not an individual,” she said. “Those colonies also live in these armadas – sort of a population of the colonies – in the middle of the open ocean.
A jellyfish ‘epidemic’ has Australian scientists wondering whether climate change is to be blamed — Authorities in Queensland, Australia, were forced to close beaches across the region over the weekend amid what local officials said was a jellyfish “epidemic.” Thousands of stings were recorded in Queensland last week, according to rescue organizations. While the vast majority of those stings were not life-threatening and were caused by “bluebottle colonies,” researchers say the number of more serious injuries from less common jellyfish is also at above-average levels. Some researchers also say this jellyfish infestation could be one more thing to blame on climate change. “Unlike other species, jellyfish are stimulated by just about any change to the ecosystem. So, it’s reasonable to say that the jellyfish might potentially be responding to the warmer-than-usual weather,” said marine life researcher Lisa Gershwin, who works with the Commonwealth Scientific and Industrial Research Organization, which is Australia’s national science agency. While researchers are still examining how much recent heat waves may have contributed to the current jellyfish bloom off Australia’s coasts, they can already say with certainty how they got to the beaches: strong and unusual winds pushing toward Queensland. Gershwin and other scientists say that the surge in stings is unlikely to be coincidental. “Jellyfish are demanding our attention right now and we should be giving it to them. Those stings are an indication that something is wrong with our oceans — and we’re silly that we’re not listening,” Gershwin said. While some scientists have been more careful about linking climate change and jellyfish blooms, given a lack of long-term data so far, most researchers agree that jellyfish populations respond positively to a number of human-induced changes, including pollution, overfishing and warmer water. “All of this takes out their predators and competitors, so they’re the ‘last men standing,’” Gershwin said.
Vital ecosystems in tidal flats lost to development and rising sea levels -- Coastal development and sea level rise are causing the decline of tidal flats along the world’s coastlines, according to research that has mapped the ecosystems for the first time.Scientists from the University of New South Wales (UNSW) and the University of Queensland used machine-learning to analyse more than 700,000 satellite images to map the extent of and change in tidal flats around the globe. The study, published in Nature, found tidal flat ecosystems in some countries declined by as much as 16% in the years from 1984 to 2016.Tidal flats are mud flats, sand flats or wide rocky reef platforms that are important coastal ecosystems. They act as buffers to storms and sea level rise and provide habitat for many species, including migratory birds and fish nurseries.Almost 50% of the global extent of tidal flats is concentrated in just eight countries: Indonesia, China, Australia, the US, Canada, India, Brazil and Myanmar. Because tidal flats were often at least partially covered by water they had been difficult to monitor in the past. The research team worked with Google and used its computing resources to analyse every satellite image ever collected of the world’s coastlines. They found that tidal flats, as an ecosystem, were as extensive globally as mangroves and that coastal development and sea level rise, in particular, were causing their decline.In parts of China and western Europe, they found tidal flats that were up to 18km wide. In Australia, they occur all over the country, including places such as Moreton Bay in Queensland and along the Gulf of Carpentaria.For 17% of the world, there was enough data available to measure declines from 1984 to 2016. In these locations, which were mostly in China, the US and countries in the Middle East, they found declines in tidal flats of 16%.
Building blocks of ocean food web in rapid decline as plankton productivity plunges - They're teeny, tiny plants and organisms but their impact on ocean life is huge.Phytoplankton and zooplankton that live near the surface are the base of the ocean's food system. Everything from small fish, big fish, whales and seabirds depend on their productivity."They actually determine what's going to happen, how much energy is going to be available for the rest of the food chain," explained Pierre Pepin, a senior researcher with the Department of Fisheries and Oceans in St. John's.Pepin says over the past three to four years, scientists have seen a persistent drop in phytoplankton and zooplankton in waters off Newfoundland and Labrador. "Based on the measurements that we've been taking in this region, we've seen pretty close to 50 per cent decline in the overall biomass of zooplankton," said Pepin. "So that's pretty dramatic."Scientists say local testing reveals half the amount of plankton in a square metre of water today. It's not just a problem here, declining plankton numbers are a global phenomenon.It's a difficult idea to convey to the average person who might not understand the ocean ecosystem, but Pepin likens it to walking into a grocery store and instead of seeing the shelves full, they're only half-full. "You know if you saw half the number of birds, if you saw half the number of fish in the water you'd pay attention. Well, this is a signal to say we need to pay attention."
World’s Oceans Warming 40% Faster Than Previously Thought - An analysis of four recent studies of ocean temperatures has corrected some of the discrepancies between climate models that projected higher levels of ocean warming and observational data that turned up lower temperatures, concluding that the higher numbers were right.The article, published in Science Friday, shows that the world's oceans are in fact warming about 40 percent faster than previously thought."The Intergovernmental Panel on Climate Change's (IPCC) Fifth Assessment Report, published in 2013, showed that leading climate change models seemed to predict a much faster increase in ocean heat content over the last 30 years than was seen in observations," study author and University of California (UC) Berkeley graduate student Zeke Hausfather said in a UC Berkeley press release. "That was a problem, because of all things, that is one thing we really hope the models will get right. The fact that these corrected records now do agree with climate models is encouraging in that is removes an area of big uncertainty that we previously had."But what is encouraging for scientists in terms of better understanding climate change may also be alarming for marine life and coastal residents, especially in the tropics. Ocean warming can have the following serious consequences, according to The New York Times.
- 1. Sea Level Rise: Warm water expands, contributing to rising sea levels, and most of the sea level rise observed up until now is more because of this effect than because of melting glaciers. Ocean warming predicted to take place this century if greenhouse gas emissions are not reduced would be enough to raise sea levels around one foot, the paper found.
- 2. Stronger, Wetter Storms: Warmer oceans contribute to storms that are both stronger and rain more, like this 2018's Hurricane Florence. As oceans warm, extreme weather events like these will become even more common.
- 3. Ocean Life: A fifth of all corals have already died because of warmer oceans, which have a harder time sustaining life. This could also be a problem for people in the tropics who depend on fish for protein. "The actual ability of the warm oceans to produce food is much lower, so that means they're going to be more quickly approaching food insecurity," Oceana Deputy Chief Scientist Kathryn Matthews told The New York Times.
Global warming of oceans equivalent to an atomic bomb per second -- Global warming has heated the oceans by the equivalent of one atomic bomb explosion per second for the past 150 years, according to analysis of new research. More than 90% of the heat trapped by humanity’s greenhouse gas emissions has been absorbed by the seas, with just a few per cent heating the air, land and ice caps respectively. The vast amount of energy being added to the oceans drives sea-level rise and enables hurricanes and typhoons to become more intense. Much of the heat has been stored in the ocean depths but measurements here only began in recent decades and existing estimates of the total heat the oceans have absorbed stretch back only to about 1950. The new work extends that back to 1871. A Guardian calculation found the average heating across that 150-year period was equivalent to about 1.5 Hiroshima-size atomic bombs per second. But the heating has accelerated over that time as carbon emissions have risen, and was now the equivalent of between three and six atomic bombs per second. “We usually try to compare the heating to [human] energy use, to make it less scary.” She added: “But obviously, we are putting a lot of excess energy into the climate system and a lot of that ends up in the ocean,” The total heat taken up by the oceans over the past 150 years was about 1,000 times the annual energy use of the entire global population. The research has been published in the journal Proceedings of the National Academy of Sciences and combined measurements of the surface temperature of the ocean since 1871 with computer models of ocean circulation.
Warming oceans likely to raise sea levels more than 30cm (11.8in) by end of century -The world’s oceans are warming at a faster rate than previously estimated, new research has found, raising fresh concerns over the rapid progress of climate change. Warming oceans take up more space, a process known as thermal expansion, which the study says is likely to raise sea levels by about 30cm by the end of the century, on top of the rise in sea levels from melting ice and glaciers. Warmer oceans are also a major factor in increasing the severity of storms, hurricanes and extreme rainfall. Rising sea levels will claim homes around English coast, report warns Read more Oceans store heat so effectively that it would take decades for them to cool down, even in the unlikely scenario that greenhouse gas emissions were halted urgently. The report, published on Thursday in the journal Science, found that the warming of the oceans was accelerating and was matching the predictions of climate change models, which have shown global temperature rises are likely to lead to extreme weather across the world. Zeke Hausfather, co-author of the paper and a graduate student at the University of California, Berkeley, said: “While 2018 will be the fourth warmest year on record on the [earth’s] surface, it will most certainly be the warmest year on record in the oceans, as was 2017 and 2016 before that. The global warming signal is a lot easier to detect if it is changing in the oceans than on the surface.” Oceans absorb more than nine-tenths of the excess energy trapped in the atmosphere by greenhouse gases, and play a key role in regulating the world’s climate. Only in recent years have scientists come to realise the full importance of oceans, which have effectively absorbed much of the impact of climate change in recent decades, but are now understood to be reaching their capacity as a buffer.
Researchers find bottom of Pacific getting colder, possibly due to Little Ice Age --- A pair of researchers, one with the Woods Hole Oceanographic Institution, the other Harvard University, has found evidence of deep ocean cooling that is likely due to the Little Ice Age. In their paper published in the journal Science, Jake Gebbie and Peter Huybers describe their study of Pacific Ocean temperatures over the past 150 years and what they found. Prior research has suggested that it takes a very long time for water in the Pacific Ocean to circulate down to its lowest depths. This is because it is replenished only from the south, which means it takes a very long time for water on the surface to make its way to the bottom—perhaps as long as several hundred years. That is what Gebbie and Huber found back in 2012. That got them to thinking that water temperature at the bottom of the Pacific could offer a hint of what surface temperatures were like hundreds of years ago. To find out if that truly was the case, the researchers obtained data from an international consortium called the Argo Program—a group of people who together have been taking ocean measurements down to depths of approximately two kilometers. As a comparative reference, the researchers also obtained data gathered by the crew of the HMS Challenger—they had taken Pacific Ocean temperatures down to a depth of two kilometers during the years 1872 to 1876. The researchers used the data from both projects to build a computer model meant to mimic the circulation of water in the Pacific Ocean over the past century and a half. The model showed that the Pacific Ocean cooled over the course of the 20th century at depths of 1.8 to 2.6 kilometers. The amount is still not precise, but the researchers suggest it is most likely between 0.02 and 0.08° C. That cooling, the researchers suggest, is likely due to the Little Ice Age, which ran from approximately 1300 until approximately 1870. Prior to that, there was a time known as the Medieval Warm Period, which had caused the deep waters of the Pacific to warm just prior to the cooling it is now experiencing.
The True Complexity Of Plastic Pollution | OilPrice.com - While the number of plastics regulations is proliferating globally, how to deal with the problem of plastic pollution is complex, particularly when viewed through the prism of climate change and carbon accounting. Plastics sequester both carbon and energy. While the period of carbon sequestration is negligible when it comes to single-use plastics, some plastics, for example in the built environment, represent long-term carbon sequestration, often with significant energy conservation attributes. The lowest-hanging fruit when it comes to emissions savings for heat and power is simply to use less. Three of the cheapest means of household energy savings are roof insulation, wall cavity insulation and UVPC double glazing. The most economical materials in all three areas are petrochemicals based. Even for single-use plastics, there are emissions benefits. Plastic-wrapped foods reduce waste, which in effect reduces the oil intensity of food production because more produce is delivered for the same upstream inputs, for example fertilizer or the diesel used in agricultural machinery. Plastic wrapping is also integral to the concept of ‘light weighting’. Light plastic packaging, which includes plastic bottles, has to be set against the increased weight of the alternatives, and the emissions created in their production and recycling. The replacement of plastic bottles with glass increases both product weight and size, which in turn raises transportation costs…
Earth’s magnetic field is acting up and geologists don’t know why Something strange is going on at the top of the world. Earth’s north magnetic pole has been skittering away from Canada and towards Siberia, driven by liquid iron sloshing within the planet’s core. The magnetic pole is moving so quickly that it has forced the world’s geomagnetism experts into a rare move. On 15 January, they are set to update the World Magnetic Model, which describes the planet’s magnetic field and underlies all modern navigation, from the systems that steer ships at sea to Google Maps on smartphones. The most recent version of the model came out in 2015 and was supposed to last until 2020 — but the magnetic field is changing so rapidly that researchers have to fix the model now. “The error is increasing all the time,” says Arnaud Chulliat, a geomagnetist at the University of Colorado Boulder and the National Oceanic and Atmospheric Administration’s (NOAA’s) National Centers for Environmental Information. The problem lies partly with the moving pole and partly with other shifts deep within the planet. Liquid churning in Earth’s core generates most of the magnetic field, which varies over time as the deep flows change. In 2016, for instance, part of the magnetic field temporarily accelerated deep under northern South America and the eastern Pacific Ocean. Satellites such as the European Space Agency’s Swarm mission tracked the shift. By early 2018, the World Magnetic Model was in trouble. Researchers from NOAA and the British Geological Survey in Edinburgh had been doing their annual check of how well the model was capturing all the variations in Earth’s magnetic field. They realized that it was so inaccurate that it was about to exceed the acceptable limit for navigational errors.
Trump Threatens to Halt Disaster Aid to California Fire Victims - President Donald Trump threatened to halt federal disaster assistance to victims of California wildfires unless that state changes its forest management practices, though much of the state’s forests are managed by the federal government. “Billions of dollars are sent to the State of California for Forrest fires that, with proper Forrest Management, would never happen,” Trump tweeted Tuesday morning, using an alternative spelling for forest. “Unless they get their act together, which is unlikely, I have ordered FEMA to send no more money.” The Federal Emergency Management Agency, also known as FEMA, administers federal disaster assistance.
Trump Threatens to Cut Off California Wildfire Aid - What does Trump have against California? Without prompting or explanation, the president tweeted Wednesday that he ordered the Federal Emergency Management Agency (FEMA) to halt funding for itswildfire relief unless "they get their act together.""Billions of dollars are sent to the State of California for Forest fires that, with proper Forest Management, would never happen," he wrote. "Unless they get their act together, which is unlikely, I have ordered FEMA to send no more money. It is a disgraceful situation in lives & money!" An earlier tweet that misspelled the word "forest" was replaced with the one that's up now.This isn't the first time the president pointed the finger at California's forest management. Last year, Trump threatened to withhold relief funds and incorrectly blamed its infernos on the state's "gross mismanagement of the forests" even though most of the fires burned on federal land.Trump has also brushed aside the role of climate change making the fires worse, saying "a lot of factors" contributed to the fires. He even suggested that California's problem was it didn't rake its forests enough, a comment that was widely ridiculed.Firefighters associations blasted the president's latest missive, calling them particularly insensitive after the deadly and overwhelming destruction caused by the 2018 blazes. For one, Northern California's record-breaking Camp Fire that ignited in early November killed 86 people, incinerated thousands of buildings and destroyed the town of Paradise.
Editorial: PG&E’s disastrous string of wildfires should not lead to state bailout - San Francisco Chronicle -- Pacific Gas and Electric Co., its customers and taxpayers are facing a future that’s nothing but bleak. The options include selling off gas operations, legal fury from a federal judge and a retreat into uncertain bankruptcy. None of it is reassuring. The giant utility is collapsing in other ways with its sinking stock price and departing executives accompanied by a call for fresh figures on its board of directors to steady the company. Tens of billions in liabilities along with court sanctions stemming from a wave of wildfires linked to faulty equipment are taking a toll. Bankruptcy would shield the company from many of its financial worries but devastate its market value. If PG&E is mulling its options, it should toss one away right now. No Sacramento bailout should be in the mix. In September, the Legislature and former Gov. Jerry Brown approved a plan for bonds to cover wildfire costs to be borne by ratepayers. It was a too-big-to-fail gambit: The state’s largest investor-owned utility needed state help to prevent hitting the financial rocks. While fires burned, that threat was good enough to win political support. Now it turns out PG&E was thinking back then of other financial paths that didn’t impose a burden on customers. It was considering selling off its gas operations to pay down future liabilities from wildfire fines and lawsuits. It wasn’t leveling with Sacramento while it dickered over the bond bailout plan. Gov. Gavin Newsom knows this history well enough and should make it clear he won’t endorse another round of financial forgiveness. The company must put all the cards on the table. It needs a management shakeup and reorganization that places safety at the top of the list, a pledge it endorsed nearly a decade ago after the deadly San Bruno pipeline explosion. Bankruptcy comes with costs beyond financial rebuilding. The state’s ambitious goal of moving to all renewable power currently includes PG&E’s help. A utility in the throes of bankruptcy might not be able or obligated to deliver on the climate change policies this state needs. But dumping the utility’s problems on Sacramento to solve goes too far. PG&E needs to take the serious steps needed to resolve the crisis it created.
3 PG&E electric executives departing amid ongoing wildfire scrutiny - Three of Pacific Gas and Electric Co.’s top executives on the electric side of its business are retiring this month, marking a major shift in key leadership as the utility endures heavy scrutiny over its role in recent devastating Northern California wildfires. Patrick Hogan, PG&E’s senior vice president of electric operations, is retiring effective Jan. 28, but his replacement assumed the title Tuesday, the utility and its parent company said in a new filing with the Securities and Exchange Commission. Also retiring are Kevin Dasso, the vice president of electric asset management, and Gregg Lemler, the vice president of electric transmission, according to an internal email obtained by The Chronicle. PG&E spokesman Matt Nauman confirmed that Hogan, Dasso and Lemler are retiring this month. He provided no further comment and said the executives were not available for interviews.
What would happen if PG&E sold its gas business or filed for bankruptcy? - California’s largest power company faces an existential crisis as it confronts the looming possibility of tens of billions of dollars in wildfire liability. Shares of PG&E Corp. — which owns Pacific Gas & Electric Co. — sank 22.3% to $18.95 on Monday after reports that the utility could face at least $30 billion in liability related to fires and has considered filing for bankruptcy protection or unloading its natural gas operations.The consequences of bankruptcy or an asset sale could ripple far beyond the utility’s shareholders, some experts say, affecting 16 million Californians who depend on PG&E for energy and potentially threatening the state’s ability to meet its climate-change goals. The utility has faced tremendous scrutiny over the last decade, starting with a 2010 gas explosion that killed eight people in San Bruno and continuing with among the deadliest and most destructive fires in state history, some of which may have been sparked by PG&E’s infrastructure. The California Public Utilities Commission is considering breaking up the company as part of an investigation into PG&E’s safety culture. Some PG&E critics have called for a government takeover or for the massive company to be replaced by smaller, municipal utilities. But it’s far from clear that local governments across Northern and Central California have the ability or the desire to take control of PG&E’s infrastructure, and to assume the huge liabilities that running the power grid entails. And state officials aren’t likely to support a takeover because then the utility’s problems would become Sacramento’s problems instead.
Either/Or - Eucalyptus plantations, “gasoline trees” as South American community peoples call them because they’re so incendiary, burned in Portugal in 2017 killing over sixty, burning them alive in their cars. The plantations burn in Chile, in Africa, in Australia, and soon GMO plantations will bring flaming death to the US Southeast. And the same fires burn across the globe, everywhere the natural habitats have been devastated and parched. This civilization will burn every last BTU’s worth it can, will burn every last splinter, will dry every last clod of soil, will pump every last molecule of carbon, will poison every drop of water, will kill every plant and animal, will be as a mythologist of modernity wrote “free and wild and beyond good and evil, with laws and morals thrown aside and all men shouting and killing and reveling in joy”, until Gaia finally puts an end to the horror. It’s self-evident that profit-seeking corporations can never seek any goal other than power and profit. By definition they can’t be enlisted toward any other goal. Any other goal automatically would constitute a constraint on maximal profit-seeking. This is logically self-evident. And for those who don’t trust logic, we have the entire evidence record of capitalist history proving it out. Without exception every example where profiteering was enlisted on behalf of a goal outside the pentacle of power, the venal motive always hijacked, distorted, destroyed the nominal goal. And that’s not even taking into account technocratic religious hatred of nature and freedom. This has been most obvious through the tragic and treacherous history of the environmental movement, whose mainstream quickly decided to become an adjunct of the corporate state with results which easily were predicted. This is obvious to anyone who knows history or who has common sense. At this late date, at this extreme of the crisis, anyone who still claims to believe it’s possible to seek a climate goal through a corporate tollbooth is a liar or an idiot. There’s no other option.
The term ‘eco-terrorist’ is back and it’s killing climate activists –- The term ‘eco-terrorist’ is back and it’s killing climate activists - When devastating wildfires were sweeping the West last fall, Ryan Zinke, who recently announced his resignation as Interior secretary, lay the blame for the blazes on a ragtag group of environmentalists. “We have been held hostage by these environmental terrorist groups that have not allowed public access, that refuse to allow the harvest of timber,” Zinke said in an interview with Breitbart News. Environmental activism has long put protesters at odds with government officials. But instead of dismissing climate-conscious demonstrators as hippies or “tree huggers,” government officials have begun using more dangerous labels — including “terrorist.” It’s happening all over the world, from the U.S. to the Philippines to Brazil (which just inaugurated particularly anti-environmental/indigenous President Jair Bolsonaro). It even happened at the recent United Nations climate talks in Poland. More than two dozen climate activists headed to the summit in Katowice were deported or refused entry on the pretext of being national threats. “I had absolutely no time to react,” said Zanna Vanrenterghem, a staff member at Climate Action Network Europe who was pulled off a train from Vienna to Katowice by border patrol agents. “The fact that this happened to 15 other people for similar reasons is very frightening. This is just a very small symptom of a larger disease.” When it comes to justifying (and promoting) extreme actions, language matters. Activists say this is part of an aggressive campaign by fossil fuel companies and their government allies to increase criminal penalties for minor violations — such as trespassing on a pipeline easement — as a way of suppressing climate action. Eighty-four members of Congress sent a bipartisan letter to the Department of Justice last fall, asking officials to prosecute pipeline activists as “terrorists.” And bills introduced in Washington and North Carolina would have defined peaceful demonstrations as “economic terrorism.” And as we know in the U.S., branding a group of people as “terrorists” is kind of a big deal.
US carbon emissions see largest yearly gain in 8 years, data show - U.S. carbon dioxide (CO2) emissions saw a yearly increase of 3.4 percent in 2018, according to preliminary estimates released Tuesday. The rise represents the second-biggest yearly gain in over two decades, independent research provider the Rhodium Group said in a note. The figures are based on "preliminary power generation, natural gas, and oil consumption data." The increase was only surpassed by the 2010 figures when the economy was bouncing back from the global financial crash, it said. Breaking the figures down, the transportation sector remained the largest source of emissions in the U.S. for the third year in a row, with "robust growth in demand" for both diesel and jet fuel offsetting a "modest" drop in gasoline consumption. While a record amount of coal-fired power plants were shut in 2018, emissions from the power sector grew by 1.9 percent, the note said. This was down to natural gas replacing the majority of this lost generation and feeding the majority of growth in electricity demand. The buildings and industrial sectors also showed "big year-on-year emissions gains." This was in part down to "unusually cold" weather at the beginning of 2018. The estimates in Tuesday's note refer to energy-related CO2 emissions only.
U.S. Carbon Emissions Spiked 3.4% in 2018, Second-Largest Increase Since 1996 - Carbon emissions in the U.S. experienced a sharp upswing in 2018, despite a record number of coal-fired power plant closings, according to new data. An analysis released by the research firm Rhodium Group Tuesday shows that emissions rose by 3.4 percent last year—the second-largest gain in more than twenty years.The analysis also found that emissions from industrial manufacturing rose 5.7 percent, while transportation emissions rose 1 percent. The analysis describes these as industries "most often ignored in clean energy and climate policymaking" and significant drivers in the increase. "The big takeaway for me is that we haven't yet successfully decoupled U.S. emissions growth from economic growth," Rhodium analyst Trevor Houser toldThe New York Times.As reported by The Washington Post:"The latest growth makes it increasingly unlikely that the United States will achieve a pledge made by the Obama administration in the run-up to the Paris climate agreement, that the country would reduce its greenhouse gas emissions by 26 to 28 percent below 2005 levels by the year 2025.A large part of President Barack Obama's plan for meeting that goal turned on key climate policies, including new regulations for vehicle fuel efficiency and power plants. These policies alone were not enough—the United States has never been on target to fulfill its Paris promises. But the Trump administration has moved to reverse or weaken them." "The U.S. has led the world in emissions reductions in the last decade thanks in large part to cheap gas displacing coal," Jason Bordoff, director of the Center on Global Energy Policy at Columbia University, who was not involved in the analysis, told The New York Times. "But that has its limits, and markets alone will not deliver anywhere close to the pace of decarbonization needed without much stronger climate policy efforts that are unfortunately stalled if not reversed under the Trump administration."
Oil industry makes landmark investment in CO2 air capture -- Chevron Corp. and Occidental Petroleum Corp. are forming the first major collaboration between the oil industry and a company deploying technology to capture carbon dioxide from the air. In an announcement yesterday, Chevron's venture capital arm and Oxy Low Carbon Ventures LLC, an Occidental subsidiary, said they would invest in Carbon Engineering, a Canadian-based firm supported by Microsoft Corp. co-founder Bill Gates and other entrepreneurs. "It is a very important time for the air capture field right now," said Steve Oldham, the CEO of Carbon Engineering. "CE's relationships with Occidental and Chevron, and these new investments, will allow us to accelerate the deployment." The companies did not disclose the dollar amount of the Carbon Engineering partnership, but a CE spokeswoman said the company is on track to reach a goal of raising $60 million by the end of the first quarter of this year. The move is the latest boost for direct air capture, which envisions sucking greenhouse gas from the atmosphere and storing it or converting it to fuel. Last year, Congress passed legislation that would allow direct air capture to qualify for federal tax credits for carbon storage, and multiple groups, universities and former Energy Secretary Ernest Moniz announced air capture initiatives. Noah Deich, executive director of the organization Carbon180, said the announcement was "big," considering it is the first time oil companies have provided public equity investment in a direct air capture company. "Energy companies have the financial capital and technical knowledge needed to scale direct air capture companies swiftly and effectively, and this announcement shows that these energy companies believe that it is a smart investment," Deich said.
Macroeconomic System for Climate Change - J.d. Alt - Abstract: A macroeconomic system including the issuing of a fiat currency by a sovereign government; the establishment of a tax regime on the government’s citizens wherein the taxes levied can only be paid with the sovereign government’s fiat currency; the sovereign government’s debiting of its tax collection account to purchase goods and services from its citizens and their commerce; the sovereign government’s issuing of future fiat currency certificates—to be redefined as “treasury bonds”—which it trades, at a discount, for existing fiat currency held in private financial markets; the sovereign government then spending the traded-for existing fiat currency to purchase goods and services from its citizens and their commerce over and above what it is able to purchase by debiting its tax collection account; the management of the value of the said fiat currency relative to goods and services by the general means of draining the currency from circulation through the sovereign tax regime—and by the specific means of controlling the discount and time-to-maturity of the issued future fiat currency certificates (treasury bonds); and wherein the sovereign government’s spending is thereby enabled to be orders-of-magnitude greater than what the government collects in taxes—without encumbering the government with debt, and without devaluing the fiat currency with respect to the citizens’ commerce; said macroeconomic system thus enabling a sovereign government to spend whatever fiat currency is necessary to enable and assist its collective society to mitigate and adapt to climate-change.
AOC’s Green New Deal as Policy -Lambert Strether -As is well known, one of the first things Alexandria Orcasio-Cortez (AOC) did when she came to Washington was to join a sit-in, in Nancy Pelosi’s office, sponsored by the Sunrise Movement, that publicized a Green New Deal (GND). The GND is obviously an enormous topic, so in this post I’m going to focus only on the GND as a policy proposal, as opposed to a pleasing slogan. (I also won’t be looking at the history of programs proposed under the GND moniker, as from the Green Party, the Data for Progress version, precursor bills introduced in Congress, or a 2008 version proposed by the UK’s New Economics Foundation). In a subsequent post I’ll look at the GND as politics; it does poll well (and not just the phrase, but the actual program). Amazingly enough,Indivisible supported the GND almost immediately (although they don’t support #MedicareForAll). The original version I read at https://ocasio2018.com/green-new-deal as a cellphone-friendly, swipe-intensive document with large type; that URL now redirects to a Google[1] Doc, here, which is the proposed rule for the establishment of a Select Committee For A Green New Deal (which Pelosi and the liberal Democrat leadership, sadly, gutted, something I’ll talk about in the post on GND politics). “Draft text”) has two parts: The proposed “Addendum,” and a “Frequently Asked Questions” section, in different fonts. In the Addendum, two “paragraphs” (legislation-ese for “section”) are key from the policy perspective: “(2) (A) LEGISLATIVE JURISDICTION” and “(6) SCOPE OF THE PLAN FOR A GREEN NEW DEAL AND THE DRAFT LEGISLATION.” I think the question “How will the government pay for these investments?” is the most important. The entire document, including the FAQ, is only eleven pages long, so I suggest you grab a cup of coffee and read it. Here are the articles I looked at as preparation for this post, in no particular order:
- “The Green New Deal, explained” Dave Roberts, Vox. A Vox explainer, with a respectful treatment of MMT. Well worth a read.
- “With a Green New Deal, Here’s What the World Could Look Like for the Next Generation” Kate Aronoff, The Intercept. A backgrounder.
- “Corporations See a Different Kind of ‘Green’ in Ocasio-Cortez’s ‘Green New Deal’” Whitney Webb, Mint Press. A critique from the left, with more close reading than most.
- “We Have To Make Sure the ‘Green New Deal’ Doesn’t Become Green Capitalism” In These Times. A conversation with Kali Akuno of Cooperation Jackson.
- Meet the scholar crafting the ‘Green New Deal’ E&E News. There seem to be several; this is “The New Consensus.”
- Alexandria Ocasio-Cortez Will Be The Leading Democrat On Climate Change Alexander C. Kaufman, HuffPo
Shutdown risks delays to U.S. drilling, ethanol, wind initiatives (Reuters) - The partial government shutdown is increasing the chances of delays in U.S. energy initiatives from the release of President Donald Trump’s proposed offshore drilling plan to allowing higher levels of ethanol in gasoline during summer months, energy industry groups said on Friday. The U.S. Department of Interior had been expected to release its highly anticipated 2019 to 2024 offshore oil and gas drilling plan in early January. The Trump administration has made opening up greater areas to offshore drilling, and holding more frequent lease sales, part of its energy dominance agenda to boost fossil fuel output for both domestic use and exports. Industry interest in several lease sales has been tepid, but the administration has said more interest is expected in the future. The Interior Department is operating at reduced staffing levels due to the partial shutdown, which has stretched two weeks. Nicolette Nye, a spokeswoman at the National Ocean Industries Association, said her group is expecting the shutdown will lead to a delay in the proposed plan’s release. But she said members of her group should not be overly affected as long as the final drilling plan, expected to be released this summer, comes on time.
EPA says it is committed to rule for higher ethanol blend by summer driving season (Reuters) - The U.S. Environmental Protection Agency said on Tuesday it would complete a rule to boost sales of higher-ethanol blends of gasoline by the summer driving season, despite a partial government shutdown. The statement from the environmental regulator came after the agency warned at least two lawmakers that the shutdown had delayed its timeline for initially rolling out the rule, according to two sources briefed on the matter. President Donald Trump pledged in the run-up to November’s congressional elections to lift the summer ban on sales of so-called E15 gasoline, in a boost to an ethanol industry upended by trade wars and weak demand growth at home. The Trump administration hoped to have the rule published by February and approved by June, but the EPA recently told lawmakers that the timeline would be delayed because of the partial government shutdown, said the two sources, who spoke to Reuters on condition of anonymity. An EPA spokesman said the agency would still complete the rule before the summer driving season. “This is a priority for both President Trump and Acting Administrator Wheeler. The ongoing partial shutdown will not impede EPA’s ability to keep to our deadline,” Michael Abboud said in an emailed statement in response to a request for comment. The acting EPA administrator is Andrew Wheeler. The EPA currently bans the higher ethanol blend, called E15, during summer because of concerns it contributes to smog on hot days - a worry biofuels advocates say is unfounded. E15 gasoline contains 15 percent ethanol, versus the 10 percent found in most U.S. gasoline. Trump’s decision to lift the ban of summer sales of E15 was applauded by corn-belt farmers and lawmakers and criticized by the oil lobby as an illegal overreach by the EPA and its acting administrator. The proposal is expected to be coupled with a slew of reforms to the credit-trading market that underpins the nation’s renewable fuel policy.
The Supreme Court just declined to hear Exxon Mobil’s appeal in a climate change lawsuit - The Supreme Court on Monday issued a significant ruling for ongoing legal battles around climate change by declining to hear oil giant Exxon Mobil’s appeal in its suit with the state of Massachusetts. In the appeal, the company was attempting to block the release of records of its knowledge of how burning fossil fuels changes the climate. Massachusetts Attorney General Maura Healey filed suit against the company in 2016 alleging that Exxon, the world’s largest investor-owned oil company, violated state consumer protection rules and misled investors about the impacts of fossil fuels on climate change as well as risks of climate change to its business. The Massachusetts Supreme Judicial Court decided last April that Exxon would have to start turning over internal documents about its knowledge about the impacts of fossil fuel combustion on the global climate. Exxon appealed the decision to the Supreme Court, arguing that the Massachusetts attorney general doesn’t have jurisdiction to compel the company to release documents. But the high court declined to hear the appeal — a blow to Exxon that may lead to more damaging revelations about the company. The company has not yet responded to a request for comment, but the company website says it has followed the scientific consensus on climate change.
Court Rules EPA Must Release 20,000 Emails Between Wheeler, Other Top Officials and Polluting Industries -A federal court has ordered that top officials at the Environmental Protection Agency (EPA)—including Acting Administrator Andrew Wheeler—must release about 20,000 emails exchanged with industry groups, The Washington Post reported Monday. The December 26 decision by the U.S. District Court for the Northern District of California was the result of a lawsuit brought by the Sierra Club after the EPA missed its deadline in responding to a Freedom of Information Act (FOIA) request. The environmental group had sought the emails to see how industry contacts might be influencing decisions by officials like Wheeler, a former coal lobbyist, to roll back Obama-era regulations on climate-change causing emissions and other pollutants. "The law is clear: the EPA must produce these documents, it must do so quickly, and if necessary it must re-allocate staff to speed things up and lift the curtain on the toxic relationship between Trump's appointees and the polluters they are supposed to be protecting us from," Senior Sierra Club Attorney Elena Saxonhouse, who helped argue the case, said in a press release. The EPA had said it was so inundated with FOIA requests that it needed until 2022 to release the documents, but the Sierra Club argued successfully that the release could not wait that long, in part because President Donald Trump has indicated he will nominate Wheeler to officially replace former Administrator Scott Pruitt, who resigned in part because of scandals revealed through previous Sierra Club FOIA requests. "The Senate should not act on Wheeler's expected nomination until we know exactly what he is up to behind the scenes. The revelations which FOIA'd emails uncovered about Scott Pruitt were unprecedented, shocking, and helped bring about his rapid downfall," Sierra Club Executive Director Michael Brune said in the press release. "Now, we await tens of thousands of emails between Andrew Wheeler, his industry-conflicted deputies, and the polluters they are supposed to be protecting us from. Given Wheeler and Wherum's history of exclusively protecting polluter profits, we can only imagine what abuses these documents are likely to uncover."
McNamee won't recuse himself from resilience debates unless they 'closely resemble' coal bailout --Federal Energy Regulatory Commission ethics officials have advised Commissioner Bernard McNamee to not recuse himself from FERC's grid resilience proceeding, the regulator said in a Monday letter to Senate Democrats, unless it comes to "closely resemble" the debate over the coal and nuclear bailout proposal he helped craft at the Department of Energy.FERC set up the resilience docket last January after rejecting the plan McNamee helped design. Democrats and environmental groupspressed him to recuse himself from the resilience proceeding, but the letter says McNamee told ethics officials he would only step aside if the original bailout plan comes before FERC again. Democrats also pushed McNamee to recuse himself from issues "pitting one fuel source against another" after the release of a February video critical of renewable energy. Ethics officials wrote they would take those issues on a "case-by-case basis," but final decisions about any recusal rest with the commissioner himself. McNamee's letter to Senate Democrats attempts to draw a distinction between FERC's rejection of the DOE's Notice of Proposed Rulemaking (NOPR) to prop up coal and nuclear plants and the longer-term resilience docket regulators set up in its wake. The letter includes a correspondence between McNamee and FERC Associate General Counsel Charles A. Beamon about an ethics briefing on Dec. 12. It was supplied to Utility Dive by a source close to the issue who requested anonymity because they were not authorized to release it publicly.
New electric generating capacity in 2019 will come from renewables and natural gas – EIA - According to EIA’s latest inventory of electric generators, 23.7 gigawatts (GW) of new capacity additions and 8.3 GW of capacity retirements are expected for the U.S. electric power sector in 2019. The utility-scale capacity additions consist primarily of wind (46%), natural gas (34%), and solar photovoltaics (18%), with the remaining 2% consisting primarily of other renewables and battery storage capacity.
- Wind. A total of 10.9 GW of wind capacity is currently scheduled to come online in 2019. Most of the capacity will not come online until the end of the year, which is typical for renewable capacity. Three states—Texas, Iowa, and Illinois—will be home to more than half of the 2019 planned wind capacity additions.
- Natural gas. Planned natural gas capacity additions are primarily in the form of combined-cycle plants (6.1 GW) and combustion-turbine plants (1.4 GW). Most of the natural gas capacity is scheduled to be online by June 2019 in preparation for high summer demand. 60% will occur in Pennsylvania, Florida, and Louisiana.
- Solar photovoltaics. Nearly half of the 4.3 GW of utility-scale electric power sector solar photovoltaic (PV) capacity additions are located in three states: Texas, California, and North Carolina.
Scheduled capacity retirements for 2019 primarily consist of coal (53%), natural gas (27%), and nuclear (18%), with a single hydroelectric plant in the state of Washington and other smaller renewable and petroleum capacity accounting for the remaining 2%.
- Coal. Most of the coal retirements are scheduled to occur at the end of 2019. Half of the planned retirement capacity for coal is at a single plant, Navajo, located in Arizona that first came online in the 1970s. The 4.5 GW of coal-fired capacity expected to retire in 2019 is relatively small compared with the estimated 13.7 GW that retired in 2018, which was the second-highest amount of coal capacity retired in a year.
- Natural gas. The scheduled natural gas retirements (2.2 GW) consist mostly (2.0 GW) of steam turbine plants. The natural gas steam turbine plants that are scheduled to retire are all older units that came online in the 1950s or 1960s. Most of the retiring natural gas steam turbine capacity (1.6 GW) is located in California.
- Nuclear. Two nuclear plants totaling 1.5 GW are currently scheduled to retire in 2019. The Pilgrim Nuclear Power Station, located in Massachusetts, is scheduled to retire in May, and the remaining unit at the Three Mile Island Power Station, located in Pennsylvania, is scheduled to retire in September.
American Electric Power takes another swing at adding Midwestern wind power capacity -Two units of American Electric Power Co. announced requests for wind energy proposals yesterday, less than six months after the company decided to cancel its $4.5 billion Wind Catcher project.The new approach reflects continued interest in wind at AEP’s Southwestern Electric Power Co. (SWEPCO) and Public Service Company of Oklahoma (PSO), despite Texas regulators’ rejection of a Wind Catcher application last year.That AEP project called for acquiring a 2,000-megawatt wind farm that Invenergy LLC had been working on in Oklahoma, with about 1,400 MW slated for SWEPCO and 600 MW linked to PSO. The plan also envisioned a 765-kilovolt power line, which would have run hundreds of miles in Oklahoma.Now, SWEPCO is requesting proposals for as much as 1,200 MW of wind energy that would be in commercial operation by Dec. 15, 2021. The plans must have a nameplate rating of at least 100 MW and are due March 1, SWEPCO said. The company said it’s looking to acquire new or existing projects that qualify for at least 80 percent of a federal production tax credit.Another requirement, according to SWEPCO, is that projects will need to be interconnected to the Southwest Power Pool grid in Arkansas, Louisiana, Texas or Oklahoma. The new approach to wind expansion is different from Wind Catcher in part because it involves a competitive process. PSO, which operates in parts of Oklahoma, said yesterday that it’s also seeking proposals for wind resources that would be operating commercially by late 2021. Stan Whiteford, a PSO spokesman, said the amount of wind pursued by the company will depend on what the responses show and could be in the hundreds of megawatts. Whiteford said PSO already has more than 1,100 MW of wind under contract through power purchase deals.
Ohio Consumers’ Counsel, others fight back against AEP solar project -- The Ohio Consumers’ Counsel, the Ohio Coal Association and other groups say American Electric Power Ohio’s plan to develop solar power in southern Ohio is expensive, unnecessary and goes against the state’s goal of deregulated markets. At a public hearing held by state regulators last month, residents and environmental groups gushed about an American Electric Power Ohio proposal to develop two solar farms in southern Ohio. Now, several groups, led by the Ohio Consumers’ Counsel, are fighting back, saying the AEP plan is expensive, unnecessary and goes against the state’s goal of deregulated markets. “If indeed these renewable energy projects are economical, then market forces should be sufficient to see these or other renewable energy projects through development,” according to testimony filed last week with the Public Utilities Commission of Ohio by the Ohio Manufacturers’ Association. That group, the Ohio Coal Association, Industrial Energy Users-Ohio and Kroger are among the opponents to the project along with the Consumers’ Counsel. AEP Ohio announced in September its proposal to develop 400 megawatts of solar power in Highland County as part of a commitment it made in 2016 to develop 900 megawatts of renewable power. The project would result in 4,000 construction jobs and 150 permanent jobs. A typical residential customer who uses 1,000 kilowatt hours of electricity a month initially would pay 28 cents more a month to pay for the plant, but that number is projected to drop over time and lead to credits on a customer’s bill, something opponents also dispute. AEP estimates that customers will save $200 million over the 20-year life of the project compared with other energy sources for electricity. If approved by the state, the project could be operational before the end of 2021.
World’s biggest solar-plus-storage project comes online in Hawaii - AES Corporation launched the world’s largest battery plant paired with solar generation Tuesday, on the Hawaiian island of Kauai.The Kauai Island Utility Cooperative is finishing up commissioning for the Lawa’i Solar and Energy Storage Project, which combines 28 megawatts of solar photovoltaic capacity with a lithium-ion battery capable of storing 100 megawatt-hours.The battery alone holds more energy than all but one other U.S. plant: the 120 megawatt-hour facility AES built in Escondido in 2017. Taken as a whole, Lawa’i’s storage capacity outranks any other operational solar-paired battery system in the world, according to Wood Mackenzie Power and Renewables. But the ever-growing solar-plus-storage project pipeline means that title won’t be safe for long.The plant delivers solar power when a standalone solar plant can’t: at night. That offsets the peaker plants that turn on for the evening peak; in Hawaii, those plants tend to run on imported oil, at considerable expense. Lawa’i can crank a full output of 20 megawatts for five hours. With 100 megawatt-hours of stored energy, the battery can also operate more like a baseload plant, delivering a lower amount of power for more hours through the night until the sun comes back up. AES expects to offset 3.7 million gallons of diesel each year by dispatching more cost-effectively than the fossil fueled incumbents.
MidAmerican Wind X11 site locations unknown -- MidAmerican Energy has proposed an additional investment of $922 million for its Wind XII project expected to be completed in late 2020 “somewhere in Iowa.” Over the past three years, MidAmerican Energy has moved forward with its Wind XI project, that when combined with Wind XII, will provide customers with 100 percent renewable energy on an annual basis. And, like MidAmerican’s previous wind projects, Wind XII will be accomplished without the need to ask for an increase in customers’ rates. Wind X1 consists of turbines in operation in Greene, Boone, Mahaska, Adair, Grundy and Poweshiek counties. The company estimates Wind XII will create more than 300 full-time jobs related to construction and another 28 full-time positions for ongoing operations and maintenance. In addition, they say Wind XII will provide an average $6.9 million per year in additional Iowa property tax payments on wind turbines and nearly $5.6 million more in annual landowner easement payments. In 2017, MidAmerican Energy paid $19.6 million in Iowa property taxes on wind turbines. The company is currently exploring potential wind farm sites in Iowa and will announce wind farm locations prior to constructing each site. Procuring proper permits, easements, right-of-ways, and willing land owners is a tedious economic endeavor. And if the word gets out, pure speculation would drive land prices over the moon. Hence, the secrecy or uncertainty about locations until the pony’s in the barn.
ISO-NE: Offshore wind can cut costs, reduce grid stress during winter storms -- Offshore wind facilities in New England could cut power production costs and reduce stress on the grid during times of extreme winter weather, according to a new study from the regional grid operator. A 1600 MW offshore wind facility would have reduced energy prices in the ISO-New England market by $11/MWh to $13/MWh during a severe cold snap that hit the region a year ago, the grid operator said in a new report. That translates to more than $80 million in production costs. The findings show how offshore wind facilities could contribute to fuel security in the region by allowing generators to burn less of their onsite oil and liquefied natural gas (LNG) supplies during periods when gas pipelines are oversubscribed. ISO-NE must file fuel security market reform plans with federal regulators by June.
Looming Supply Chain Crunch Threatens US Wind Energy Boom - While the U.S. wind energy installation outlook looks bright — more than 23 gigawatts in new capacity forecast over the next two years — looming unforeseen supply chain bottlenecks could lead to project cancellations and postponements. This could put as much as $2.1 billion of revenue at risk, according to a new study by Wood Mackenzie Power & Renewables. According to the analysis, if these supply chain constraint issues are not addressed, more than 23 percent of the wind energy capacity installations expected in 2019-2020 could be delayed or canceled. Moreover, turbine installations could decline by 1.1 gigawatts — 366 megawatts in 2019, 720 megawatts in 2020 — representing a loss of more than $800 million in turbine sales. PTC impacts, while more complex to estimate, could represent lost revenue of up to $1.3 billion over the 10-year tax credit period. “While we've seen upticks in demand put pressure on transportation capacity in the past, the total level of effort required from logistics providers this time around will be substantially higher than during past peaks,” said Shreve. “New turbine technology is producing higher-capacity turbines, but this results in further strain on the supply chain, as components are larger and heavier, and more component shipments are needed per turbine. This in turn increases requirements for highway escorts, reduces transportation equipment cycle times, and increases demand for larger cranes.” Although large players in the wind industry are preparing for rapid growth in 2019-2020, many have not anticipated the magnitude of these supply chain constraints and the losses they can cause. Unavoidable project cancellations and postponements will be difficult to absorb and can lead to knock-on declines in activity for a wide range of smaller players, as well as the local economies and work forces they support.
Saudi Arabia Closes $500 Million Wind Farm Deal - Saudi Arabia has made a first tangible step to generate electricity from sources other than oil and gas, awarding a contract on Thursday for the Kingdom’s first utility-scale wind farm. A consortium led by France’s EDF and Abu Dhabi’s Masdar has won the tender to build a 400-megawatt (MW) US$500-million wind farm in northern Saudi Arabia, AFP quoted the energy ministry of the Kingdom as saying.The first utility-scale wind project in the country is another significant step “towards creating a diversified power sector mix,” according to the Saudi ministry.Saudi Arabia has also started to work with a fund owned by SoftBank to have one day a total of 200 gigawatts (GW) of solar power in the country, Saudi Energy Minister Khalid al-Falih said last month.Saudi Arabia has its National Renewable Energy Program, under which the Kingdom aims to boost the share of renewables in its energy mix in coming years. The Saudis are targeting 3.45 GW worth of generation from renewable energy by 2020, which would represent around 4 percent of generation capacity. By 2023, the Saudi target is 9.5 GW, which would account for 10 percent of generation capacity.The Saudi renewable energy program is directly supporting the Vision 2030 strategy to overhaul the economy and diversify it away from oil. Ironically, the Saudis expect to fund part of the Vision 2030 plan with the proceeds they expect to reap from the initial public offering (IPO) of 5 percent in state oil giant Aramco. Saudi Arabia’s rulers, including Crown Prince Mohammed bin Salman, have insisted that Aramco is worth a total of US$2 trillion.
The Middle East, Africa, and Asia now drive nearly all global energy consumption growth -Energy consumption in Asia, the Middle East, and Africa continues to grow rapidly, with about 20% growth in each region between 2010 and 2016, according to newly available data in EIA’s International Energy Statistics database. In particular, energy consumption has been increasing in the Middle East and Africa, driven by economic growth, increased access to energy markets, and quickly growing populations. Energy consumption in Asia grew even as energy consumption in China declined between 2015 and 2016. Although growth was rapid in Africa and the Middle East, Asia and Oceania consumed much more energy overall (42% of 2016 world energy consumption, compared with 6% in the Middle East and 3% in Africa). Slower long-term energy consumption trends continued in the mature economies of North America, where energy consumption grew by 1% between 2010 and 2016, and in Europe, where energy consumption actually fell 4% between those years. Globally, petroleum and other liquid fuels (including biofuels such as ethanol and biodiesel) are the most prevalent form of energy consumed. Growing use of these fuels has been supported by increasing supplies of U.S. shale oil and other international sources of liquid fuels that have kept prices relatively competitive. Global coal consumption continued to decline as a result of competition from low cost natural gas as well as some countries’ policies to limit or decrease coal use. Regional fuel use varies according to the availability of resources. In 2016, coal accounted for almost 50% of the energy consumed in Asia and Oceania, where China, India, and Australia are all significant consumers of coal. The largest shares of nuclear and renewable energy were in Europe (26%), North America (19%), and Central and South America (26%). These regions, particularly Europe and North America, have significant renewable resources as well as policies that encourage renewable energy usage, especially wind and solar. Because of the region’s rich reserves of oil and natural gas, nearly all energy consumption in the Middle East comes from either petroleum or natural gas with virtually no contribution from coal, nuclear, or renewable energy.
Before the Electric Car Takes Over, Someone Needs to Reinvent the Battery- To deliver an electric vehicle that’s cheaper, safer and capable of traveling 500 miles on a single charge, the auto industry needs a breakthrough in battery technology. Easier said than done. Scientists in Japan, China and the U.S. are among those struggling to crack the code of how to significantly boost the amount of energy a battery cell can store and bring an EV's driving range into line with a full tank of gas. That quest has zeroed in on solid-state technology, an overhaul of a battery's internal architecture to use solid materials instead of flammable liquids to enable charging and discharging. The technology promises major improvements on existing lithium-ion packs, which automakers say are hitting the limits of their storage capabilities and may never hold enough power for long-distance models. If it can be mastered, solid-state technology could help speed the demise of the combustion-engine car and potentially slash EV charging times to about 10 minutes from as much as several hours. The supercharger network built by Tesla Inc., now offering some of the fastest charge times, needs approximately 30 minutes to bring a depleted car to 80 percent.
Broken regional trash plant violated environmental permits because of garbage backlog, state says - The months-long shutdown of the regional trash-to-energy plant in Hartford has resulted in trash piling up inside the facility, waste being shipped out of state and now the operators storing tons of partially processed garbage in outdoor containers in violation of state permits. Connecticut’s environmental agency has ordered the plant’s operators to move dozens of the covered containers back inside the plant, citing potential odor and safety concerns, officials said Friday. The Hartford facility is already holding an estimated 20,000 tons of garbage in its main indoor space and sending thousands of tons of trash a week to out-of-state landfills and facilities. The plant’s two turbines suffered catastrophic breakdowns on Nov. 5 and the facility hasn’t been operating since then. “We’re moving the stuff back inside so far as we can,” Thomas Kirk, president of the plant’s operators, the quasi-public Materials Innovation and Recycling Authority (MIRA), said of the trash containers that were stored outdoors. “The breakdown of the MIRA facility is a problem for much of the state,” Bronin said. “But as the trash mounts up there, it is becoming a particular problem for businesses and residents around the plant.” State officials say they are now considering the garbage agency’s request for emergency permission to store the partially processed trash outside in those large, Dumpster-like containers. MIRA officials now hope to have the plant back in operation by the end of this month. “ In the meantime, the plant’s operators have been sending more than 7,000 tons of garbage a week to trash plants and landfills in New York, Massachusetts, Pennsylvania and Virginia. MIRA officials estimate disposing of all that garbage cost their agency an additional $276,000 each week in December. The Hartford plant serves about 70 member cities and towns across Connecticut. Garbage haulers from non-member communities that are normally allowed to bring trash to the Hartford facility have been forced to find other places to dispose of that garbage since the Nov. 5 breakdown.
Is methane too valuable to waste? - - The methane gas produced from decomposing organic waste can be released into the air, or it can be used to produce electricity. The latter is what's done at the Oneida-Herkimer Solid Waste Authority’s Boonville facility."Since landfill gas is 50 percent methane, then most landfills from day one, whether they’re required to or not, you design (ways to capture that gas) into a system," said William Rabbia, executive director of the Oneida-Herkimer Solid Waste Authority. "(They) want to beneficially utilize it."Methane is a greenhouse gas, meaning scientists believe it is contributing to a warming climate. It also is more than 30 times more potent than carbon dioxide, Rabbia said, in addition to being flammable.Since 2017, the Trump Administration has moved to reduce regulations for methane release for oil, gas and landfill operations. They have cancelled a requirement for oil and gas companies to report methane emissions and revised and partially repealed an Obama-era rule to limit methane emissions on public lands, according to the New York Times.They also are working to relax requirements to monitor methane leaks and reduce methane emissions from landfills, according to the Environmental Protection Agency website.In New York, state regulations closely mirror federal requirements on the release of methane for landfills, Rabbia said. But that might change soon with numerous pieces of legislation aimed at bringing environmental protection rules closer to what was enacted under the Obama Administration."They’re in rule-making now (for) how do we revise our regulations to meet those lower federal limits," Rabbia said.The amount of methane the local landfill releases already is below those limits, he added, because the more they capture, the more they can potentially profit from. In fact, the authority is not required to capture any of the gas that they do.Rabbia said they do, however, "flare" — or burn — excess methane they can’t process. “We want to destroy it," Rabbia said, "to control it so it doesn’t create an issue in the environment."
Wood pellet maker plans $200M investment in Mississippi (AP) — A company that makes wood pellets burned for fuel in overseas power plants is moving ahead with plans for a $140 million pellet mill and a $60 million ship-loading terminal on the Mississippi Gulf Coast. Enviva LP spokeswoman Maria Moreno said Wednesday that the Maryland company signed agreements Monday with leaders in George and Jackson counties. The company won’t finalize its investment until environmental permits are approved for facilities in Lucedale and Pascagoula, she said. Enviva expects to hire about 90 workers in Lucedale. As many as 300 loggers and truckers could also find work supplying logs to Enviva. “We are excited to build on our success in Mississippi by investing in new facilities in George and Jackson Counties,” Chairman and CEO John Keppler said in a statement. “Enviva’s very first facility, a small plant in Amory, this week produced its one millionth ton of wood pellets.” George County Community Development Director Ken Flanagan says county supervisors approved property tax abatements, cutting a projected $13 million or more from Enviva’s property taxes over 10 years. He said the county, with state aid, plans road, water and wastewater improvements to support Enviva. The Mississippi Development Authority earlier awarded $4 million for the Enviva work. Flanagan said county officials expect Enviva to begin construction later this year, completing the work in 14 to 18 months.
Northam proposes coal ash disposal, coastal protection bills (AP)— Virginia Gov. Ralph Northam proposed a package of environmental legislation Thursday aimed at safely disposing of coal ash, helping coastal communities deal with flooding caused by climate change and continuing the cleanup of the Chesapeake Bay. The legislative agenda introduced includes a bill to allow the state to use an estimated $50 million in revenue from the sale of new carbon pollution credits for coastal resilience projects. Northam said the state needs to play a larger role in reducing the risks of climate change, particularly along its coastline. “In Hampton Roads, this threatens critical infrastructure like our port and the world’s largest naval base,” the Democratic governor said, referring to the Norfolk Naval Base. “It also threatens thousands of homes and puts the entire regional economy at risk.” Northam has pushed Virginia to join the Regional Greenhouse Gas Initiative, a cap-and-trade program among Northeastern and mid-Atlantic states that mandates emission reductions in the power sector. The Northam administration expects to generate about $65 million a year in new credits from carbon-emitting power plants but needs legislative approval to spend that money or it will stay with the utilities. Northam is also proposing to use some of the money for economic development in coal communities in a bid to gain GOP support. Republican leaders did not immediately respond to Northam’s proposal but have opposed joining RGGI in the past. Last year, Northam Republicans passed a bill that would have required legislative approval before Virginia can participate in the initiative, legislation that Northam vetoed. Northam also backed legislation Thursday to require coal ash to be removed from unlined pits and either recycled or moved to EPA-approved landfills.
TVA doing up to $200M worth of business with contractor accused of poisoning coal ash workers -- TVA is continuing to back — financially and publicly — the global contractor accused of poisoning hundreds of workers, including the agency’s own employees, during the clean up of the agency’s coal ash spill — the nation’s largest. TVA has awarded Jacobs Engineering contracts to the tune of as much as $200 million despite revelations the firm denied disaster relief workers at the Kingston Fossil Fuel Power Plant protective gear, lied and tampered with testing — and a jury’s conclusion in November the firm violated its contract with TVA. Under those new contracts, Jacobs is responsible for worker safety. And, as Roane County leaders gathered on the 10-year anniversary of the Dec. 22, 2008, disaster to honor the more than 35 workers who are now dead and the more than 300 who are dying, TVA spent $1,225 to buy a full-page ad thanking its contractors, including Jacobs Engineering. A spokesman for the nation’s largest power utility defended the advertisement — and its contracts with Jacobs — when contacted by USA TODAY NETWORK-Tennessee this week. The ad appeared in the Roane County News. It covered an entire page. It began with, “Kingston — a legacy of promises kept.” 'TVA is proud of the work' “We ran the ad because it was the 10th anniversary of the spill, and TVA is proud of the work accomplished to restore the community to as good as, or better, than we found it,” said spokesman Scott Brooks.
Trump Officially Nominates Former Coal Lobbyist Andrew Wheeler to Head EPA -- In a long-expected move, President Donald Trump formally nominated acting U.S. Environmental Protection Agency (EPA) head and former coal lobbyist Andrew Wheeler to officially run the agency Wednesday.Wheeler has headed the EPA for six months following the resignation of disgraced former Administrator Scott Pruitt, making him the longest-serving acting administrator in EPA history, The Huffington Post reported. His nomination is expected to clear the Republican-controlled Senate."I am honored and grateful that President Trump has nominated me to lead the Environmental Protection Agency," Wheeler said in a statement reported by The Huffington Post. "For me, there is no greater responsibility than protecting human health and the environment, and I look forward to carrying out this essential task on behalf of the American public."However, many environmental groups disagreed with his self-assessment and raised concerns about his existing record on protecting environmental and public health and fighting climate change. "The only thing Wheeler is going to protect at the EPA is the profits of polluters," Center for Biological Diversity Government Affairs Director Brett Hartl said in a statement. "I'm sure corporate board rooms will celebrate this nomination. But for anyone who drinks water, breathes air or cares about wildlife, this will be nothing but awful."
New EPA Likely To Adversely Affect Environment - Federal rules on the use of mercury by the Obama government are too costly to be implemented, this is the recent comment made on the present rule by the Environmental Protection Agency. Based on this, the Trump government has proposed to bring in major changes in the way human health and safety benefits are calculated. Power plants, which use coal to generate electricity, are emitting mercury, and this mercury emission is considered bad for the environment protection. The proposed calculation or cost- benefit analysis will take into consideration only few factors while measuring the human safety. The measurement will be based only on the aspects which can be determined in dollars; the qualitative approach to health might become completely neglected in this approach. According to Robert N. Stavins, who is a professor of environmental economics at Harvard University informed this new approach will make it extremely difficult for the government to justify the environmental rules and regulations. Apparently, the rules are still against mercury emissions. But the underlying terms and conditions for this environmental law regarding mercury emission have become quite flimsy. The coal mines now might get more confidence to challenge the law in the court. The rules were first framed in 2011. These restricted not only mercury emission but also other pollutants which emerge from the coal plants. This step was also considered as one of the most significant achievements of President Obama. According to EPA, the expenses of ensuring that the mercury emission law is followed ranges between $7.4 billion to $9.6 US billion. The health benefits of reducing mercury ranged between $4 million to $6 million on an annual basis. This means, the benefits are lesser than the cost. Contrary to this, the Obama government had cited an annual benefit of 80 billion US dollars by cutting mercury.
India to bring 21 more reactors online by 2031 - India currently expects to bring 21 new nuclear power reactors with a combined generating capacity of 15,700 MWe into operation by 2031, the country’s minister of state for the Department of Atomic Energy told parliament yesterday. Jitendra Singh said: “At present, there are nine nuclear power reactors at various stages of construction. These include two units in each of the states of Gujarat, Rajasthan and Haryana, plus three in Tamil Nadu. All these units are scheduled to be completed by 2024-2025. “In addition, 12 more nuclear power reactors have been accorded administrative approval and financial sanction by the government in June 2017. Thus, 21 nuclear power reactors, with an installed capacity of 15,700 MWe are under implementation, envisaged for progressive completion by the year 2031.” Singh also noted that five sites have been granted “in principle” approval to establish a further 28 reactors.
UAE postpones work at first nuclear power plant - The United Arab Emirates’ Energy Minister Suhail Al-Mazrouei said yesterday that work at the country’s first nuclear power station will not begin as planned at the end of 2019. Al-Mazrouei said in a statement: “Nuclear is coming [but] there will be a bit of a delay,” without disclosing the reasons for the postponement. When operational, the plant’s four units will provide reliable and environmentally friendly energy to the UAE’s power grid as well as contribute to reducing the emission.The cost of constructing the Baraka nuclear power plants is $24.4 billion with a power generation capacity of 5,600 MW. The Korean Electric Power Corporation (KEPCO) is building the plant’s four reactors simultaneously.
Hitachi set to cancel plans for £16bn nuclear power station in Wales - The Japanese conglomerate Hitachi looks certain to cancel its plans for a £16bn nuclear power station in Wales, leaving Britain’s ambitions for a nuclear renaissance in tatters.An impasse in months-long talks between the company, London and Toyko on financing is expected to result in the flagship project being axed at a Hitachi board meeting next week, according to the Nikkei newspaper.The company has spent nearly £2bn on the planned Wylfa power station on Anglesey, which would have powered around 5m homes.Another Japanese giant, Toshiba, scrapped a nuclear plant in Cumbria just two months ago after failing to find a buyer for the ailing project.Withdrawal by Hitachi would be a major blow to the UK’s plans to replace dirty coal and ageing reactors with new nuclear power plants, and heap pressure on ministers to consider other large-scale alternatives such as offshore windfarms.It would also mark an end to Japan’s hopes of exporting its nuclear technology around the world.
Nuclear Power Is Economically Obsolete - Last year the Trump administration's Energy Department announced the launch of a media campaign to counter what an official called "misinformation" about nuclear power. We haven't noticed an upsurge in pro-nuclear news—because there is none to report. On the first day of 2019, the energy industry trade journal Power asked whether new technology can save nuclear power by making new reactors economically feasible—not only to replace coal and natural gas but also to compete with the rapidly dropping cost of renewable energy. The verdict from Peter Bradford, a former member of the federal Nuclear Regulatory Commission:. . . [N]ew nuclear is so far outside the competitive range. . . . Not only can nuclear power not stop global warming, it is probably not even an essential part of the solution to global warming.His bleak outlook is shared by the authors of a recent article in the Proceedings of the National Academy of Sciences. The authors—an engineer, an economist and a national security analyst—reviewed the prospects for so-called advanced designs for large nuclear reactors, and for much smaller modular reactors that could avoid the billions in construction costs and overruns that have plagued the nuclear energy industry since the beginning.They concluded that no new designs can possibly reach the market before the middle of the century. They cite the breeder reactor that, according to the Bulletin of Atomic Scientists, received $100 billion in public development funds worldwide over six decades and still did not get off the ground. The authors say there may be an opening for small modular reactors but that it will be very difficult to find a market for these reactors without—as is always the case with nuclear power—a massive infusion of taxpayer dollars. "For that to happen," they argue, "several hundred billion dollars of direct and indirect subsidies would be needed to support their development and deployment over the next several decades, since present competitive energy markets will not induce their development and adoption."
More cracks found in Hunterston reactors - Pressure is mounting to keep two nuclear power reactors at Hunterston in North Ayrshire closed after the company that runs them, EDF Energy, said it had found more cracks and was again postponing plans to restart.The French company now estimates that there are 370 major cracks in the graphite core of reactor three and 200 cracks in the core of reactor four. Reactor three has been closed down since 9 March 2018, and reactor four since 2 October.The day after The Ferret revealed in November that 350 cracks had been discovered in reactor three in breach of an operating safety limit, EDF postponed restarting both reactors to January and February.But there’s been a further delay, with the company now hoping to restart reactor four at the end of March and reactor three at the end of April. On 9 January the group of nuclear-free local authorities held a safety briefing on Hunterston for MSPs in the Scottish Parliament. Experts called for the reactors to stay closed rather than risking a nuclear accident, and for new jobs to be created in Ayrshire.Nuclear policy consultant, Dr Ian Fairlie, argued that the increasing number of cracks in the ageing reactors spelled their end. “There is only one thing you can do and that is close them, as they cannot be repaired,” he told The Ferret.“Although the risks of a major adverse event at Hunterston are relatively small, one has to take into account what the worst case scenario could be, and that is pretty serious indeed – the radioactive contamination and evacuation of both Glasgow and Edinburgh.” Fairlie urged the Scottish Government to take a more pro-active stance. “It needs to take a good look at the risks here and to decide whether it is really worthwhile running them,” he said. “After all we don’t need their electricity, though we need to ensure that jobs are safeguarded.”
Read the Scientific American article the government deemed too dangerous to publish --In April 1950, the US federal government raided the offices of Scientific American Magazine to destroy every printed issue. “Three thousand copies already run off were burned, type was melted down, and every galley proof and script impounded.” Three years later, Fahrenheit 451 was published without knowledge of this incident. The banned magazine contained an article, titled “The Hydrogen Bomb: II” written by Professor Hans Bethe, the “wartime chief of theoretical physics at Los Alamos.” His article had an imperative purpose: To clarify technical misconceptions in the daily press and to “take up the moral … meaning of the bomb in the general framework of foreign relations”. In current times, it is hard to imagine Scientific American as a politically charged institution or that Ray Bradbury’s caricature of Cold War hysteria was ever realized. The government not only burned every issue of Scientific American but also questioned the magazine’s political allegiance. As a reliable Federal Bureau of Investigation source stated in Bethe’s file, “Scientific American runs the sort of stuff which the Soviets would like to see in popular scientific journal, including left-wing authors on atomic energy and security questions.” The same issue in question contained an article written by Albert Einstein. After redacting four technical paragraphs, roughly 15,000 articles eventually made it to print. The article remained controversial even despite the redacted technical paragraphs and left the FBI and the Atomic Energy Commission a bit disgruntled. However, Bethe had powerful allies who vouched for his intentions, including fellow Manhattan Project physicist John Dunning. Even decades later, Bethe’s passionate urging against developing the Hydrogen bomb still resonates:“After such a [nuclear] war, nothing that resembled present civilization would remain … The fight for mere survival would dominate everything … Indeed it is likely that technology and science, having brought such utter misery upon man, would be suspected as works of the devil, and a new Dark Age would begin on earth. Can we who have always insisted on morality and human decency … introduce this weapon of total annihilation into the world?” Muckrock readers can now consult the words of Bethe and his deep insights on the destructive power of mankind, through a less flammable digital pdf of “The Hydrogen Bomb: II,” embedded below, or on the request page. However, the original typeset remains unknown, lost in the melt of one’s imagination.
19 Rigs Active During Last Year of 2018 – The Ohio Department of Natural Resources reports that 19 oil and gas rigs were in operation across Ohio’s Utica shale during the week ended December 29.The last full week of 2018 witnessed four permits for horizontal wells awarded to two energy exploration companies, according to the latest data provided by ODNR. XTO Energy Inc. secured two permits for wells in Belmont County, while Ascent Resources LLC — today the most active driller in the Utica — was awarded two permits for wells in Jefferson County. As of Dec. 29, 2,957 permits have been issued for new horizontal wells across Ohio’s Utica, ODNR reports. Of that number, 2,491 of those wells are drilled and 2,120 are in production. No new permits were reported in Mahoning, Columbiana and Trumbull counties. Utica permit activity in nearby Lawrence and Mercer counties in western Pennsylvania was also quiet during the week, since no new permits were reported in those counties, according to the Pennsylvania Department of Environmental Protection.
U.S. Chamber says anti-energy group prevents development - — A new report by the U.S. Chamber of Commerce Global Energy Institute (GEI) found that the anti-energy "Keep it in the Ground" (KIITG) movement has prevented at least $91.9 billion in domestic economic activity and eliminated nearly 730,000 job opportunities. In addition, federal, state, and local governments have missed out on more than $20 billion in tax revenue. The report, "Infrastructure Lost: Why America Cannot Afford To ‘Keep It In the Ground,’" quantifies the impacts of delayed and cancelled energy infrastructure projects that would enhance American consumers’ access to abundant, affordable energy and provide hundreds of thousands of good-paying jobs. In recent years, KIITG activists have worked to derail these projects by waging countless lawsuits, protests and even vandalizing private property with the goal of delaying or outright killing projects.Dan Alfaro, spokesperson for Energy In Depth - Ohio, noted that "This report is the first we’ve seen that has quantified the true costs of these Keep it in the Ground efforts, and I think it’s going to open a lot of eyes to the actual, real-life consequences these misguided protests and nuisance lawsuits have on the workforce and the communities they affect."As the Global Energy Institute notes in this report, these figures are coming from 15 projects – there are more examples out there that add to these figures, and unfortunately we’ve seen some of them here in Ohio. The effort to ban fracking in the city of Youngstown is probably the clearest example of what kind of negative economic impact the KIITG movement has had here. The city’s voters have rejected the anti-fracking initiatives put forth by out-of-state, out-of-touch activists eight times, and it has been the taxpayers in the city that are on the hook to pay the costs of having these measures on the ballot." CELDF has been behind a number of these efforts in Ohio – in Youngstown and communities across the state - and they’ve gone on the record stating they are not concerned if their efforts end up bankrupting the cities they’re using to advance their anti-oil and gas objectives. "These are incredibly costly tactics, and unfortunately it’s the taxpayers, the workforce, and the communities that are bearing the burden of these costs." Alfaro said.
Radium found in commercial roadway de-icing, dust suppression brine - Pittsburgh Post-Gazette - An Ohio environmental organization is suing to learn more about unhealthy radiation levels in a commercial de-icing and dust suppression liquid made from gas well brine sold in several states, including Pennsylvania. The Buckeye Environmental Network filed suit against the Ohio Department of Natural Resources last week, claiming the agency has illegally denied its request to inspect public records and documents pertaining to the environmental and health impacts of the brine product AquaSalina, manufactured by Brecksville, Ohio-based Nature’s Own Source. According to a July 2017 ODNR report that was released early this year after the network filed a right-to-know request, the department found samples of AquaSalina that contained concentrations of radium, a known carcinogen, that are higher than those naturally occurring in brine produced from “conventional,” that is non-shale, gas wells. The ODNR’s Division of Oil and Gas Resources Management, Radiation Safety Section, tested 14 samples of AquaSalina collected from six locations in Ohio, and found radium 226 and 228 levels that exceeded the state’s “discharge to the environment limits” and its safe drinking water limits by a factor of 300. The study said the production process used by Nature’s Own Source seems to have produced “TENORM,” or Technologically Enhanced Naturally Occurring Radioactive Material, that contains more radiation than the brine had when it was pushed out of the wells. Among the sites where the ODNR obtained AquaSalina for testing in June 2017 was a Lowe’s home improvement store in Canton, Ohio, and a hardware store in Hartville, Stark County, south of Akron. “The levels in the de-icer were typically over 300 times the U.S. Environmental Protection Agency limit for drinking water and exceeded Ohio regulations,” Mr. Stolz said. “I was concerned to see that the product purchased at the hardware store had total radium (226 and 228 combined) levels of 2,500 picocuries per liter, 500 times the U.S. EPA limit.”
A Small Town's Battle Against Radioactive Fracking Waste - - Estill County isn’t the kind of place you’d think would have a radioactive waste problem. Half of this quiet, unassuming nook of eastern Kentucky is covered like a quilt with farmhouses and churches, while the other half rests in the shade of Daniel Boone National Forest. In Estill’s center, nestled between the Appalachian foothills and the Kentucky River, sits Irvine (population 2,400). Route 89 slices through town as Main Street, crossing the river via a light-green truss bridge on its way to the middle and high schools. Right across the street from the schools, which serve students from all over the county, sits the local landfill. So when news broke in early 2016 that the local landfill had for months been illegally burying 1,900 tons of radioactive—and potentially carcinogenic—material, this tight-knit community was shocked. “It’s an insult to the intelligence of the people who live here,” says Nancy Farmer, a lifelong resident who spent 34 years on the Estill County Board of Education. “It’s certainly insulting that life in Estill County is being valued less than life anywhere else, because they’re willing to put this kind of material close to students in two different schools.” In 1995, Farmer volunteered to help create a legally binding Host Community Agreement between the county and the landfill owners. As a solid waste facility, the Blue Ridge Landfill could take neither ash residue from a nearby nerve gas and blister gas storage facility (where around 2 percent of our country’s chemical weapons have been kept since 1942) nor radiological waste from anywhere else. But two decades later, the landfill began illegally accepting radioactive waste anyway. This time it was fracking leftovers sent across state lines from West Virginia and Ohio. For three years the radioactive waste has sat within a few hundred feet of the schools, and the town is locked in battle over what to do with it.
Why vote to accept toxic waste? - Why vote to accept toxic waste? Recently our state representatives voted for, and passed, SB-1196, a bill that would allow Michigan landfills to apply for approval to receive highly radioactive wastes from Pennsylvania and other states that do not allow them in their landfills.These wastes include radiums and radioactive lead that are in fracking water that is used to force natural gas and oil out of deeply buried rock layers. Such wastes come from fracking operations in Ohio and Pennsylvania (DTE’s Nexus natural gas pipeline runs from Pennsylvania and Ohio through southeast Michigan). Radioactive waste water will be transported up I-75 and U.S. 23 to a proposed landfill near Detroit in Wayne County.You might ask why our state representatives, including Bronna Kahle, Jason Sheppard and Joseph Bellino, among others, would vote for such toxic waste to be dumped in Michigan. Is it a coincidence that our state representatives also accepted campaign money from DTE and the oil and gas industry? Money speaks louder than conscience for many of our state legislators apparently. Remember their deeds when elections come, please. In 1989 such a dump was proposed for Riga Township, but due to fierce local opposition, it was abandoned. When will our state representatives learn?
Chester County DA names former federal prosecutor to beef up pipeline probe | StateImpact Pennsylvania - Chester County’s District Attorney on Friday named a former federal prosecutor with experience in environmental law to work on a criminal investigation into Sunoco’s controversial Mariner East 2 pipeline, and said the probe will go ahead regardless of any talks with the company. Seth Weber, a former federal prosecutor, has been appointed special prosecutor by the Chester County district attorney, who is conducting a criminal investigation of the Mariner East 2 pipeline project. DA Tom Hogan said Seth Weber prosecuted many complex environmental cases as well as political corruption, drugs and violent crime cases during a 26-year career as an assistant U.S. attorney for the Eastern District of Pennsylvania. Hogan said in an interview on Friday that his office has been in touch with Sunoco since the investigation was announced, and that company officials are due to come to his office next week to discuss turning over the many documents that his office has demanded. The company said after the probe was announced on Dec. 19 that it looked forward to speaking with Hogan’s office in the hope of bringing the matter to an “appropriate resolution.” But Hogan said the investigation will proceed whether or not there are talks with Sunoco. “Nothing is going to stop the investigation,” Hogan said. “It’s simply a matter of them turning over information to us and us going through the information and then we will probably be back to them requesting more information. We will be interviewing people, experts will be reviewing stuff, all the things that normally go into an environmental investigation.” Hogan said the outcome of the probe might include “criminal charges, or a report, or nothing.” He added: “We don’t know what we don’t know.” Sunoco said Weber’s appointment is an addition to what it called a “meritless” investigation. Hogan “will not be able to avoid the inescapable conclusion that Energy Transfer has not engaged in any form of criminal activity, and the issues referenced have already each been thoroughly investigated, reviewed, and ultimately resolved by the appropriate government agencies,” said Lisa Dillinger, a spokeswoman for Sunoco’s parent, Energy Transfer. Weber offered his services after hearing about the investigation, and has agreed to join two other prosecutors as part of the team even though he will not be paid, Hogan said.
Judges Say DEP Unlawfully Issued Air-Quality Permits To Sunoco At Marcus Hook - A Pennsylvania court said the Department of Environmental Protection unlawfully issued air-quality permits to Sunoco for its natural gas liquids plant at Marcus Hook in Delaware County, and it ordered the department to re-do its analysis over whether the plant should be subject to two sets of emissions rules. The Environmental Hearing Board, which hears appeals against DEP actions, said in a ruling on Wednesday that the DEP was wrong to treat sections of the plant as separate entities when assessing their emissions, and should have evaluated the plant as a whole. And it said Sunoco appeared to have applied for the air permits for different parts of the plant rather than in aggregate in an attempt to avoid two sets of emissions regulations that would have been triggered if the operation had been considered as a whole. The regulations are known as PSD, or Prevention of Significant Deterioration, and NSR, or New Source Review. "There is some evidence of record to show that Sunoco had a plan to develop its facility in such a way as to deliberately avoid triggering PSD/NSR requirements," Judge Bernard Labuskes wrote in a 78-page opinion for all five EHB judges. He called the application a "deliberately evasive plan" and said there was clear evidence that Sunoco intended to combine all of the facilities for which it had separately submitted air-permit applications. "There is no question that Sunoco did have a plan to make all the adjustments necessary to turn the Marcus Hook facility into a comprehensive NGL hub," he wrote.
FERC Staff Issues Environmental Assessment for Adelphia Gateway Project - Adelphia Gateway, LLC today announced the Federal Energy Regulatory Commission (FERC) Staff issued its Environmental Assessment (EA) for the Adelphia Gateway Pipeline Project (Project) recommending that the FERC Certificate Order for the Project contain a finding of no significant environmental impact."Adelphia Gateway is an important project that will deliver clean, low cost natural gas to constrained markets in the Greater Philadelphia region," said Steve Westhoven, president and chief operating officer of New Jersey Resources, the parent company of Adelphia Gateway. "We are pleased FERC Staff issued the Environmental Assessment and confirmed the project will have no significant environmental impact as it converts an existing pipeline to natural gas. We look forward to continuing to work with regulators and local communities to place Adelphia Gateway into service." The EA process is designed to independently analyze Adelphia Gateway's proposed conversion of an existing oil pipeline to natural gas and assess potential environmental impacts of the construction and operation of the Project. Following receipt of a FERC Certificate Order and all other necessary regulatory approvals, Adelphia Gateway expects the Project to be placed into service in 2019. The Adelphia Gateway Project will convert 50 miles of an existing 84-mile pipeline — spanning portions of Delaware, Chester, Bucks, Montgomery and Northampton counties — from oil to natural gas. The northern 34 miles of the pipeline, which extends from western Bucks County to the Martins Creek terminal in Northampton County, has delivered natural gas since 1996. The Project also involves construction of compressor station facilities in West Rockhill Township and Lower Chichester Township and approximately 4.7 miles of new laterals in Delaware County, Pennsylvania and New Castle County, Delaware.
Algonquin pipeline protesters guilty of trespassing, but judge spares them punishment - A Cortlandt judge on Tuesday found three protesters guilty of trespassing for locking themselves inside a natural gas pipeline in Verplanck in 2016 but let them go free without any punishment. Judge Kimberley Ragazzo rejected a prosecutor’s request that the protesters perform 300 hours of community service with an organization not affiliated with environmental causes. Instead, Ragazzo said the three were free to continue protesting as long as they don’t break the law. “This case has dragged on long enough,” Ragazzo said. Rebecca J. Berlin of Yorktown Heights, Janet Gonzalez of Yonkers and David Publow of Troy spent 16 hours inside a section of pipeline on Oct. 10, 2016, protesting the federal government's decision to allow the pipeline be installed near Indian Point nuclear power plant. The three were arrested shortly before midnight by state troopers who spent the day negotiating with them to exit a section of pipe 42 inches in diameter that was being readied to carry gas under the Hudson River. While there, they sent short videos out on Twitter. Their attorney, David Dorfman, said he will appeal the guilty verdict.
Vermont Gas ordered to show whether engineer OK’d pipeline plans -- Vermont Gas, owner of the 41-mile natural gas pipeline between Colchester and Middlebury, has to show the state’s utility regulator whether a professional engineer signed off on construction plans. The Vermont Public Utility Commission issued an order Thursday upholding a request by opponents to further expand an investigation into the pipeline’s construction. Three months after the Addison County Natural Gas pipeline was completed in April of 2017, the utility regulator began looking into claims that the pipeline was not buried deep enough. The state’s Agency of Natural Resources and Department of Public Service submitted filings in March seeking to expand the investigation into pipeline construction methods. James Dumont, an attorney representing five Monkton and Hinesburg residents who oppose the pipeline, filed a motion in November to expand the investigation further to assess whether a professional engineer had signed off on the pipeline construction plans. The request was made in response to a National Transportation Safety Board review of the Lawrence natural gas explosions that found the Massachusetts operator did not seek approval of a professional engineer before construction. The Department of Public Service made a filing in December supporting this request. Pipeline opponents submitted another filing in December arguing that Vermont Gas should have to argue why the pipeline should be allowed to continue to operate if it did not have an engineer’s approval. PUC hearing officer Michael Tousley wrote in the order that RCP Inc. — the Texas-based engineering firm hired by the PUC as an independent investigator in the case — should assess whether a Vermont-licensed professional engineer signed off on the pipeline construction plans.
What Is Driving The Recent Drop In Northeast Production? - After hitting a new high of 31.7 Bcf/d on December 5, Northeast production has tumbled more than 0.7 Bcf/d for no clear reason. With maintenance and freeze-offs likely out of the question, evidence suggests the dip may be tied to a slowdown in drilling in late summer that is finally beginning to manifest itself now. If the recent dip is indeed a function of a drilling slowdown rather than a short-term blip in production, it would tighten not just balances this winter, but also next summer, resulting in upward pressure on regional prices and at Henry Hub. Northeast production peaked on December 5 at 31.7 Bcf/d, but has averaged a mere 31 Bcf/d since that mark and fell as low as 30.4 Bcf/d on December 14. There are no major maintenance events in the region driving the production drop. Further, while recent temperatures in the Northeast have dipped as low as 20 degrees on December 8 following the production peak, Platts does not believe freeze-offs are driving the decline given freeze-offs in the Northeast have historically occurred when temperatures dip into the single digits or lower. As well, Platts utilized pipeline specific gas quality data for major Northeast production pipelines to determine if the recent fluctuations in regional production can be tied to changes in the heat content of the natural gas stream. Gas quality data from TCO, Dominion, Rover, Tennessee and TETCO shows that the heat content of the gas hitting these five pipelines has been relatively consistent since November, making it unlikely to explain the nearly 1 Bcf/d decline from the start of December to the most recent seven days. With that in mind, Platts believes the most recent production drop in the Northeast may be tied to a slowdown in drilling in late summer that is starting to be reflected in this month’s production volumes. We note that both the August 2018 and September 2018 periods saw a large decline in wells drilled, and equally important, wells completed. As Northeast wells typically hit peak production roughly 3-5 months after they are brought online (based on average type curves for the Utica), it would follow that the wells completed in August and September should be hitting their peak in December and then entering their natural decline phase thereafter. That would explain the march up to 31.7 Bcf/d on December 5 and then the quick drop off in production immediately following that peak, despite no maintenance events and little evidence of freeze offs. It would seem reasonable that producers tried to maximize production from those wells that were completed in August/ September and were peaking in late November/early December during the recent price rally above $4. However, of note, production then began to dip before prices fell back below $4, suggesting operators maximized production from those wells completed in August/September and could no longer keep production afloat.
S&P: U.S. gas-fired capacity additions soared in 2018 - The amount of gas-fired generating capacity added in the U.S. in 2018 nearly doubled the amount added the year before, according to S&P Global Market Intelligence data.New gas-fired capacity in 2018 totaled 18,550 MW, nearly three-fourths of the 24,808 MW added from all sources. The additions more than offset the 16,900 MW of capacity, mostly coal-fired, that were retired last year. In 2017, gas-fired capacity additions totaled 9,837 MW, about half the 19,367 MW that were added.The largest share of new capacity, totaling about 10,500 MW, was added in the PJM Interconnection region in the mid-Atlantic, and most of those new additions were large gas-fired units. Two of the largest gas-fired power plants that began operating in 2018 are outside of competitive markets and directly serve their utility owners. Duke Energy Corp. added its 1,640-MW Crystal River CC (Citrus County) plant in Florida for its local utility Duke Energy Florida LLC, and the Tennessee Valley Authority added its 1,132-MW Thomas H Allen CC plant to replace a nearly 60-year-old coal-fired plant that was retired.Wind and solar capacity additions declined in 2018 compared to the year before. About 3,081 MW of wind was built in 2018, down from 4,987 MW added in 2017. Among wholesale power markets, ERCOT had the largest amount of wind capacity built, with about 1,080 MW, followed by the Southwest Power Pool, which had 580 MW. Another 705 MW of wind was built in the western U.S. outside of organized markets. The solar industry took a hit when the Trump administration issued tariffs in January 2018 on imports of solar cells and panels. About 2,888 MW of solar was built in 2018, down from 3,964 MW added in 2017.
Rogersville Shale Test Wells in KY, WV Appear to be a Flop ...The clock has run out on state confidentiality laws and results are now available for several test wells drilled in both the Kentucky and West Virginia in the Rogersville Shale–and the results are rather lackluster. NGI ace reporter Jamison Cocklin has been checking records in records recently released to the public and found the following:Test results from the Rogersville Shale in Eastern Kentucky and Southwest West Virginia continue to trickle out, but activity in the unproven play remains stagnant.Only six test locations have been permitted since 2013, when Cimarex Energy Co. subsidiary Bruin Exploration LLC was issued the first stratigraphic test permit in Lawrence County, KY. Charleston, WV-based Hard Rock Exploration Inc. had applied for a vertical test permit in Putnam County, WV, but it filed for bankruptcy in 2017. The mid-2014 commodities downturn also helped to curtail exploration activity in the play.While there’s been little activity recently, data from earlier wells that had been protected by state confidentiality laws has since become available, again revealing lackluster results from a play that has generated some buzz in recent years as an up-and-coming target for Appalachian producers.*Jamison reviewed production records and shared numbers in the article–but they are his numbers to share. You’ll need a subscription (or free trial) to read the full article.The last time we wrote about/heard about the Rogersville test well program was in late 2015 (see MDN’s Rogersville stories here). The bottom line appears to be this: With the prolific Marcellus, Utica and Upper Devonian shales to tap in PA, OH and WV, and with less-than-stellar results from the few Rogersville wells already drilled, don’t look for any more Rogersville drilling to happen any time soon.
State lawmakers join forces against offshore drilling — A group of nine Democratic state lawmakers from different coastal states announced Tuesday that they are going to use their coming legislative sessions to try to block attempts at offshore drilling. The lawmakers’ announcement came as new and re-elected legislators were entering office around the country after an election that saw high turnover in some states, and the group said it wants to take advantage of new political dynamics that could favor environmental bills. The announcement also came about a year after Trump’s administration announced plans to expand drilling. The lawmakers, who are affiliated with nonprofit advocacy group National Caucus of Environmental Legislators, said their bills will seek to limit the possibility of drilling off their coasts. State legislatures are limited in what they can do to stop drilling beyond state waters, but the lawmakers said they’re showing a united stand against the practice. “We need to pass permanent legislation in our states so that this ban would be in place for the future,” New Hampshire Sen. Martha Fuller Clark said. “We can’t afford to rely on Washington to protect us.” Others lawmakers involved in the effort represent Connecticut, Georgia, Hawaii, Maine, Massachusetts, New York, Oregon and Rhode Island. Some of the lawmakers said they would seek outright bans on drilling, while others said they would look to pass bills that restrict it or do more to hold companies liable for spills.
Report: Gas leaks plague Bay State - Gov. Charlie Baker took a victory lap Saturday touting the Merrimack Valley’s economic recovery after September’s deadly gas explosions — but state records investigated by the Herald show that months before the region was rocked by fire, the state’s crumbling infrastructure and gas leaks made the blasts almost inevitable. The study revealed the state had more than 34,000 reported gas leaks in 2017. Almost 7,500 of those were considered “Grade 1” leaks — the highest classification, representing an “existing or probable hazard to persons or property” and requiring repair “as immediately as possible.” “We’re literally sitting on bombs,” said Audrey Schulman, executive director of Cambridge-based HEET, a nonprofit that helps residents save energy in their homes and lower gas emissions. Her organization maps gas leaks across Massachusetts using DPU data. “The pipes in Massachusetts are past their well-use dates.” The state Department of Public Utilities (DPU) presented a December 2018 report to state legislators on the prevalence of natural gas leaks in Massachusetts, highlighting the number of leaks for 2017 and the time and cost estimates for eliminating the mounting backlog of the leaks. Massachusetts law requires utility companies to grade all reported natural gas leaks on a 1 to 3 scale based on the hazard posed by the leak:
- A grade 1 leak represents an “existing or probably hazard to persons or property and requires repair ‘as immediately as possible.'”
- A grade 2 leak is non-hazardous to persons or property at the time of detection, but “justifies scheduled repair based on probable future hazard.”
- A grade 3 leak is non-hazardous to persons or property at the time of detection and can be “reasonably expected to remain non-hazardous.”
In 2017, there were a collective 34,369 leaks on the gas distribution system. Broken down as follows: 7,437 Grade 1 leaks; 6,393 Grade 2 leaks; and 20,539 Grade 3 leaks. Those figures do not represent the number of ongoing and unrepaired leaks.
Ridgefield fracking ban heads to hearing then vote - The town’s nearly year-long debate over a ban against “fracking” — hydraulic fracturing — and the reuse of wastes from the fracking process, which is used in oil and gas extraction, will likely come to a conclusion in the next week. A proposed anti-fracking ordinance petitioned for by more than 600 environmentally concerned citizens will go to a public hearing at 10 a.m. Saturday and then a town meeting at 7:30 p.m. Wednesday — both in town hall. The proposed ordinance carries fines of up to $250, as well as a requirement to remediate damage and reimburse the town for costs related to violations. The heart of the proposal being put before townspeople by the Board of Selectmen, at the request of 664 petition signers, is a prohibition on the use or reuse of wastes from natural gas or oil extraction on property in town, disposal of it in wastewater treatment or solid waste processing facilities, as well as a ban on a long list of activities including the sale, acquisition, transfer and handling of such wastes.
TransCanada spokesperson on Maryland’s pipeline block: “We’re committed to this route” — A recent decision by the Maryland Board of Public Works to deny an easement for a natural gas pipeline leading to West Virginia’s eastern panhandle is stirring reaction from the company behind the project. TransCanada subsidiary Columbia Gas Transmission, LLC previously requested an easement for an eight inch, 3.37 mile fracked gas line from Fulton County, Pennsylvania into Morgan County, West Virginia. Known as the “Potomac Pipeline”, this would connect an existing line in Pennsylvania to the Mountaineer Gas line from the Berkeley Springs area through Martinsburg. This line would eventually extend into Jefferson County and some of it would serve the controversial Rockwool insulation plant in Ranson. The West Virginia Public Service Commission approved a $119.8 million plan for that extension in December. In a letter dated January 1 and addressed to the Maryland Board of Public Works, a group of 65 Maryland delegates and senators expressed concern over the Potomac Pipeline. The effort was a two year campaign spearheaded by environmental advocates Potomac Riverkeeper Network. Primary concerns of Columbia’s pipeline include potential impact to the Potomac River and the Western Maryland Rail Trail, which the proposed line would go underneath. “We’re going to be drilling more than 100 feet below the rail trail and the river, so there will be no impact to either one,” TransCanada spokesperson Scott Castleman said on MetroNews Talkline. “There will be no impact during construction, recreation activities, business activities, everything else can continue as usual. “In the unlikely event of a leak under a water body, natural gas will bubble to the top and dissipate into the atmosphere. There’s no impact to the water with a pipeline of this nature.”
With Democrats in House majority, they might threaten the very fracking that has lowered US emissions - Now that Democrats have recaptured the House, energy production on public lands in the American West is likely to come under increased scrutiny. But it’s hard to see what anyone would gain from slowing down an oil and gas leasing program that’s become a growth engine for the nation’s economy and is having a huge positive impact on job creation. If you want to understand the importance of the Trump administration’s decision to ease restrictions on issuing leases for drilling on public lands, a good place to start is with the need for natural gas, a fuel that is more plentiful than oil and burns much more cleanly. From an environmental point of view, the increased use of natural gas has driven down U.S. emissions of carbon dioxide from the electric power sector to a 20-year low by substituting for carbon-rich coal. Last year, U.S. production of natural gas broke all-time records, reaching 33.4 trillion cubic feet. Nearly a quarter of the gas is produced in Texas, with increasing amounts coming from Colorado, New Mexico, and Wyoming. The Western states are blessed with substantial reserves of natural gas, and it would be nothing short of folly not to extract those resources. If we can’t take advantage of our natural gas resources, we must rely on imports. Consider that as recently as 2007 the U.S. was spending billions of dollars a year to buy liquefied natural gas from foreign countries. Now the U.S. is significantly more energy secure, and we’re able to export liquefied natural gas to buyers around the world, thanks to the growth in gas production that’s been made possible by the shale revolution and made-in-the-USA extraction technologies such as fracking and directional drilling.
Will 2019 be the year Virginia cracks down on methane emissions? -An Atlantic Coast Pipeline compressor station before Virginia regulators could be the first to face tougher standards amid heightened scrutiny of methane leaks in the state.The Virginia Department of Environmental Quality’s draft permit for a compressor station in Buckingham County includes a requirement for inclusion of a vent gas reduction system the agency claims will cut methane emissions by more than 99 percent due to reduced venting of natural gas.If approved by the State Air Pollution Control Board, this would mark the first time the department has issued a permit requiring the methane-reduction technology. It looks to be a sign of more regulation to come.As high-profile battles over the Atlantic Coast and Mountain Valley pipelines rage, Virginia has quietly moved to begin regulating greenhouse gases — including methane emissions — more tightly.In September, Virginia Gov. Ralph Northam announced a series of initiatives to combat climate change, including the creation of a task force that will look at methane emissions from natural gas infrastructure and landfills and likely recommend new state regulations. The task force is forming as Northam tries to balance demands from Dominion Energy, a political powerhouse in terms of campaign finance and lobbying, and environmentalists in his own Democratic Party — some of whom have criticized him for not taking a firm stand against the pipelines.
Mountain Valley Pipeline says expansion will not cause excess natural gas supply — Mountain Valley Pipeline told federal regulators it was not overbuilding as it defended its MVP Southgate natural gas pipeline expansion from protests by two North Carolina agencies and a coalition of environmental groups. Mountain Valley said in a Tuesday motion filed with the Federal Energy Regulatory Commission that the project is designed to meet growing gas demand in central North Carolina and southern Virginia. "The project will not create excess gas supply," the pipeline developer wrote. "The project will provide natural gas transportation capacity and access to new supplies in the Marcellus and Utica shale regions to meet demand in the Southeast." Mountain Valley was responding to protests by the North Carolina Utilities Commission, the North Carolina Department of Environmental Quality and groups led by Appalachian Mountain Advocates. Among other issues they raised, these parties said the rates proposed by the company were not properly supported, the project did not seem to be in the public interest and the project would result in too much pipeline infrastructure in the region. "The Southgate project would create an excess supply of natural gas," the North Carolina Department of Environmental Quality said in a letter dated December 10, 2018. Mountain Valley has applied to FERC for a certificate of public necessity for the expansion project, which is supported by a firm gas transportation service contract of 300,000 Dt/d with SCANA utility PSNC Energy. Mountain Valley asked the commission to authorize the project by December 1, 2019, in order to meet its target in-service date of November 1, 2020, as part of an agreement with the customer. Construction on the nearly 73-mile MVP Southgate pipeline is expected to begin in the first quarter of 2020. It will be operated by EQM Midstream Partners. The project would connect to the mainline of the Mountain Valley pipeline near Chatham, Virginia, and extend to delivery points in Rockingham and Alamance counties, North Carolina. Facilities would include new 24- and 16-inch diameter pipeline and a 28,915-horsepower compressor station (CP19-14).
Potential Species Extinction Stops Work on the Atlantic Coast Gas Pipeline - Dominion Energy has put a halt to construction of the 965-km multibillion dollar Atlantic Coast Pipeline, after the 4th U.S. Circuit Court of Appeals ruled that more study is needed to properly evaluate the environmental impact of pipeline construction on four endangered species across West Virginia, Virginia and North Carolina.Environmental groups claim the rusty patch bumble bee, the Indiana bat, the Madison cave isopod (a type of crustacean) and the clubshell mussel would all be adversely affected by the Atlantic pipeline, even threatening their very existence.According to the environmental group’s legal briefs, "pipeline construction could harm endangered species in a variety of ways. The clubshell mussel would be buried alive by dredging and grading. Digging and blasting could crush or trap the Madison cave isopod. The rusty-patched bumble bee could be injured or killed by tree felling. And tree clearing would force pregnant female bats to change their flight routes, exposing the bats to predators."Lawyers for the pipeline contend that the court's decision is overly broad and argue that construction could take place in North Carolina, where none of the four endangered species have sensitive habitats. The new stay is expected to be in effect pending review of environmentalists' challenge to the documents. Oral arguments in the case are scheduled for March, 2019.
Lobbyist: 'Rogue environmental groups' standing in way of building pipelines --Construction on the Atlantic Coast Pipeline has been halted because “rogue environmental groups” are getting in the way, an energy lobbyist told lawmakers Tuesday.“It’s on hold because the 4th Circuit Court of Appeals allowed a rogue environmental group to contest various permits that we have on the project,” Bob Orndorff, state policy director for Dominion Energy, said to the Joint Committee on Natural Gas Development on behalf of the West Virginia Oil and Natural Gas Association, during a presentation of various facts and figures about natural gas jobs in West Virginia.The natural gas pipeline being built by Dominion Energy voluntarily halted construction along the project’s 600-mile-long path in December after the 4th Circuit Court of Appeals issued a stay to the U.S. Fish and Wildlife Service’s Biological Opinion and Incidental Take Statement. The next week, a panel vacated the Forest Service’s Special Use Permit and Record of Decision, required to build the project through the George Washington and Monongahela national forests.In the opinion, Judge Stephanie Thacker, of West Virginia, quoted Dr. Seuss’s “The Lorax.” “We trust the United States Forest Service to ‘speak for the trees, for the trees have no tongues,’” the opinion says. Chief Judge Roger Gregory and Judge James Wynn, who also heard oral arguments in the case in September, joined. “It’s the federal agencies who went rogue here. They ignored the law, they ignored warnings from their own experts to approve a destructive and unnecessary pipeline,” said DJ Gerken, senior attorney for the Southern Environmental Law Center, which argued on behalf of conservation groups in both legal challenges. The halt has cost thousands of jobs, Orndorff said. Some people can continue to work because the Atlantic Coast Pipeline is required to maintain erosion and sediment control, he said. There’d be even more jobs if the Federal Energy Regulatory Commission allows the Atlantic Coast Pipeline to “button things up,” he said. That would mean at least putting the pipe in the ground, welding it and re-vegetating the land around it. The Atlantic Coast Pipeline is one of many pipelines being built in the region to tap into the booming Marcellus Shale formation. Many pipelines have similarly faced legal challenges and environmental violations.
Toscano Urges Against Investing in Atlantic Coast Pipeline (WVIR) - Charlottesville State Delegate David Toscano is urging state leaders to consider investing in renewable energies instead of Dominion Energy’s Atlantic Coast Pipeline. The 600-mile underground pipeline construction project that travels through North Carolina, Virginia, and West Virginia has been met with contention by advocacy groups and state legislators. Delegate Toscano compared the pipeline to an old, leaky car that is not worth the investment to keep going. He says investing in other improvements to energy efficiently could mean transitioning to a fossil fuel-free economy in the future. In a statement on his website posted earlier this week, Toscano said that the use of electricity has remained the same, while the cost of renewable energy has gone down. He argues that this means the pipeline is not needed and improvements to energy storage could mean less reliance on fossil fuels. “The energy landscape has changed so dramatically in the last five years,” Toscano said. “The cost of solar energy and wind energy has come down dramatically and the game-changer in energy storage is the ability to store energy and then dispatch it when the sun doesn’t shine and the wind doesn’t blow.” According to Toscano, investing in some of those technologies rather than the ACP will help Virginia transition to a fossil fuel-free based economy in the future.
State air board backs Buckingham compressor station for Atlantic Coast Pipeline - A pitched public battle over a natural gas compressor station for the Atlantic Coast Pipeline in Buckingham County ended with a vote of approval for a permit that state officials hailed as a new national standard for air pollution controls on gas turbines and opponents branded as tainted by political interference from Gov. Ralph Northam. The State Air Pollution Control Board voted 4-0 to approve the compressor station permit Tuesday, acting without three of its seven members — two of whom Northam had replaced abruptly in November. The vote came during a raucous two-hour meeting at a Chesterfield County conference center that was thronged by protesters and Virginia State Police. “The bottom line here is the Buckingham Compressor Station will be the most stringently regulated compressor station in the country and the public’s health will be protected,” said Mike Dowd, director of the Department of Environmental Quality’s Air Division, as dozens of protesters stood behind him with their backs turned. Opponents vowed to continue the fight against the compressor station permit in court and accused the board of ignoring the “disproportionate impact” of the project on Union Hill, a community centered around two African-American churches and the former site of a slave-holding plantation that spawned it. “The compressor station is making us the sacrificial lamb,” said John Laury, 74, an African-American resident who grew up in Union Hill and moved back to the community more than 15 years ago. Dominion Energy, lead partner for the Atlantic Coast Pipeline, said the board decision represents “the final state approval needed in Virginia” for the $7 billion, 600-mile pipeline project, which would rely on three compressor stations to deliver natural gas from West Virginia to southeastern Virginia and eastern North Carolina.
Virginia gives Dominion permit for Atlantic Coast natgas pipe compressor (Reuters) - An environmental board in Virginia unanimously approved an air permit for a compressor station on Tuesday for Dominion Energy Inc's planned nearly $7 billion Atlantic Coast natural gas pipeline from West Virginia to North Carolina. The fight over the permit was just one of several battles Atlantic Coast and other pipelines are facing to move gas from the Marcellus and Utica shale in Pennsylvania, West Virginia and Ohio to customers in the U.S. Southeast. There are two big gas pipes under construction in Virginia - Atlantic Coast and EQM Midstream Partners LP's Mountain Valley project. Both are at least $1 billion over budget and about a year behind schedule due primarily to legal battles with environmental and local groups opposed to the projects. "While the (compressor) approval process has concluded, we know we have to continue building trust in the community," Karl Neddenien, spokesman for Atlantic Coast said in an email, noting the company will invest in a new community center, a rescue squad and more. In December, the Virginia Air Pollution Control Board delayed a vote on the compressor over concerns it would violate civil rights by forcing the historically African-American Union Hill community to bear an unequal burden from pollution and other disruptions. In addition to the compressor permit, Dominion has been dealing with legal battles over other state and federal permits. In early December, Dominion suspended all construction on Atlantic Coast after the U.S. Court of Appeals for the Fourth Circuit stayed the U.S. Fish and Wildlife Service's Incidental Take Statement, which authorized pipeline construction in areas inhabited by threatened or endangered species. Neddenien said construction of the 600-mile (966-km) project remains on hold pending clarification of the scope of the Fish and Wildlife permit stay. Before the court issued the stay, Dominion said it expected to complete Atlantic Coast in mid-2020. Now, however, the company said it was waiting for the outcome of its request for clarification before offering any update on the project's schedule or cost.
Turn The Pipe Around - Will Crude Soon Be Flowing South On Capline? -The possibility of reversing the flow on Capline — the U.S.’s largest northbound crude oil pipeline — has been discussed for a number of years now. Finally, it may be on the horizon. The three owners of Louisiana-to-Illinois pipeline announced last week that this month they plan to initiate a binding open season for a reversed Capline system that would enable southbound flows starting in the third quarter of 2020 — only a year and a half from now. And, as we discuss in today’s blog, reversing Capline’s direction could open up new crude-slate possibilities for Louisiana refineries and boost crude exports out of the Bayou State. Every so often, the Mississippi River’s flow flips and its water runs north, if only for a few hours at a time. It happened most recently in the aftermath of Hurricane Isaac, in the summer of 2012, when the storm’s high winds and waters sent Ol’ Man River the other direction; it also happened during Hurricane Katrina, seven years earlier. The most amazing flow reversal of all, though, happened way back in 1812, when an estimated 8.8-magnitude earthquake — the strongest of several major quakes to hit Missouri and Arkansas that winter — shook, rattled and rolled the whole middle of North America. (The New Madrid earthquake was so strong that it collapsed brick walls as far away as Cincinnati and caused church bells to ring in Boston.)
BP just discovered a billion barrels of oil in the Gulf of Mexico - BP's investment in next-generation technology just paid off to the tune of a billion barrels of oil. The British energy company has discovered 1 billion barrels of crude at an existing oilfield in the Gulf of Mexico. BP also announced two new offshore oil discoveries and a major new investment in a nearby field. BP is the Gulf of Mexico's biggest producer, and it's making strides to hold that title. BP now expects its fossil fuel output from the region to reach 400,000 barrels of oil equivalent per day by the middle of the next decade. Today, it produces about 300,000 boepd, up from less than 200,000 boepd about five years ago. On Tuesday, the company said it will spend $1.3 billion to develop a third phase of its Atlantis field off the coast of New Orleans. Scheduled to start production in 2020, the eight new wells will add 38,000 bpd to BP's production at Atlantis. The decision comes after BP found another 400 million barrels of oil at the field. BP made the massive 1 billion-barrel discovery at its Thunder Horse field off the tip of Louisiana. Executives are crediting their investment in advanced seismic technology and data processing for speeding up the company's ability to confirm the discoveries at Atlantis and Thunder Horse. BP says it once would have taken a year to analyze the Thunder Horse data, but it now takes just weeks. "We are building on our world-class position, upgrading the resources at our fields through technology, productivity and exploration success," Bernard Looney, BP's chief executive for production and exploration, said in a statement. Just northeast of Thunder Horse, BP also announced new discoveries at fields near its Na Kika platform. BP says it plans to develop reservoirs at its Manuel prospect, where Shell holds a 50 percent stake. Producers also found oil at the Nearly Headless Nick prospect near Na Kika, where BP has a 20.25 percent working interest.
BP Okays $1.3B Expansion in Gulf of Mexico - BP has approved a $1.3 billion expansion for the Atlantis Phase 3 development in the U.S. Gulf of Mexico, the company announced Tuesday. The development, which includes the construction of a new subsea production system from eight new wells, will boost production at the platform by as much as 38,000 barrels of oil equivalent per day (boepd). The approval for the Atlantis Phase 3 development is timed great for BP as the supermajor recently discovered an additional 400 million barrels of oil at the Atlantis field. The project is scheduled to come onstream in 2020. Additionally, BP announced that another one billion barrels of oil have been identified at the Thunder Horse field as well as two new discoveries near the Na Kika production facility. “BP’s Gulf of Mexico business is key to our strategy of growing production of advantaged high-margin oil,” said BP Upstream chief executive Bernard Looney. “And these fields are still young – only 12 percent of the hydrocarbons in place across our Gulf portfolio have been produced so far.” Looney added that the company sees “many opportunities” for further development through the middle of the next decade and beyond. BP’s two discoveries near the Na Kika facility – the Manuel discovery located on Mississippi Canyon block 520 and the Nearly Headless Nick discovery located on Mississippi Canyon block 387 – could provide further tie-back development opportunities. BP’s net production in the Gulf of Mexico has increased significantly over the past five years. The area currently produces more than 300,000 barrels of oil equivalent per day. BP expects its production to grow to 400,000 barrels of oil equivalent per day through the middle of the next decade – fueled by recent project startups, including Thunder Horse Northwest and Thunder Horse South expansions and the Thunder Horse Water Injection project, as well as the addition of the Argos platform platform at the Mad Dog field.
BP approves expansion of Gulf oil project (AP) — BP has approved a $1.3 billion expansion at one of its oil projects in the Gulf of Mexico and discovered an additional 1.4 billion barrels at two of them. “BP’s Gulf of Mexico business is key to our strategy of growing production of advantaged high-margin oil. We are building on our world-class position, upgrading the resources at our fields through technology, productivity and exploration success,” Bernard Looney, BP’s Upstream chief executive, said in a news release Tuesday. “And these fields are still young - only 12 percent of the hydrocarbons in place across our Gulf portfolio have been produced so far. We can see many opportunities for further development, offering the potential to continue to create significant value through the middle of the next decade and beyond.” The Courier reports the announcement comes amid a 4½-year offshore oil bust that has cost the Houma-Thibodaux area about 16,000 jobs. Over the past few months, several reports from economists and consultants have predicted an uptick in the Gulf this year, forecasts that hinge on how high oil prices rise above current levels of about $50 a barrel. The development of Atlantis Phase 3 will include the construction of a new subsea production system from eight new wells that will be tied into the current platform, 150 miles (240 kilometers) south of New Orleans. The company says it’s scheduled to begin operating in 2020 and is expected to boost production by an estimated 38,000 barrels of oil equivalent a day gross at its peak. BP operates Atlantis and holds a 56 percent working interest, with BHP holding the remaining 44 percent. BHP is expected to make a final decision early this year on whether to proceed with the expansion. BP’s actions come after the company’s recent breakthroughs in advanced seismic imaging and related technology that revealed an additional 400 million barrels of oil in place at the Atlantis field, officials said. The same innovation helped the company find an additional 1 billion barrels oil at its nearby Thunder Horse field, officials said. And new discoveries near BP’s Na Kika platform provide additional development opportunities, officials said. BP is already the Gulf’s largest oil producer, and officials say the latest discoveries will help it grow output to about 400,000 barrels a day within the next decade.
OPEC Oil Exports To The U.S. Fall To Five-Year Low - The United States received in December the lowest volume of OPEC-derived crude oil in five years, according to market intelligence firm Kpler and data from Refinitive Eikon, cited by Reuters on Thursday. 1.63 million bpd of oil from OPEC member countries made its way to US shores in December, down from 1.80 million bpd in November and 1.78 million bpd in October. Saudi Arabia shipped 534,000 barrels per day to the United States in December, a near 100,000 bpd drop from November. Algeria’s shipments were also down almost 100,000 bpd, and Nigeria’s shipments to the US dipped by almost 50,000 bpd. Iraq, on the other hand, increased crude oil shipments to the United States by 140,000 bpd, and for somewhat of a shock, Venezuela shipped 22,738 barrels per day more to the US in December, although the long-term trend here shows a steady decline in Venezuela’s oil exports to the US, which were around 912,000 bpd in 2012, falling to 618,000 bpd by 2017, according to the Energy Information Administration. Saudi Arabia’s crude oil exports to the US have also been falling steadily in recent years, from 1.361 million bpd in 2012 to 1.052 million bpd in 2015, and then to 949,000 bpd by 2017. The United States has been imported less crude oil altogether—not just less OPEC crude. With the rise of US shale, the United States has cut its thirst for foreign crude oil from 262.8 million barrels per month in January 2017 to 226.6 million in October 2018—the last month for which there is data, according to the EIA.
Suddenly, A Slew Of Gulf Coast Crude Loadings Onto VLCCs - In 2018, a handful of midstream companies started racing to develop deepwater export terminals along the Gulf Coast that can fully load Very Large Crude Carriers (VLCCs) with 2 MMbbl of crude oil from the Permian and other plays. While some of those companies are moving toward final investment decisions (FIDs) that would bring their plans to fruition in the early 2020s, terminal operators with existing VLCC-capable assets — both onshore and offshore — turned up the volume in a major way in December. Today, we outline the strides made in recent days by the export programs of the Louisiana Offshore Oil Port (LOOP), Seaway Texas City and Moda Midstream. In today’s market, there’s only one existing terminal that can fully load a VLCC in one fell swoop — that’s the Louisiana Offshore Oil Port, or LOOP, off Port Fourchon, LA. We’ve reported in our weekly Crude Voyager that in February 2018 LOOP kicked off its export program, loading an entire supertanker for shipment to China. They did it again in March, and then sent out one a month from June through September. The exports out of LOOP quieted for a few months as the facility worked on expanding its capacity to load tankers at a faster rate. When December rolled around, LOOP showed off its new upgrades to the market by loading three supertankers — about 6 MMbbl of crude in total — in a matter of only seven days. That’s impressive — it had never been done before — but companies like Enterprise Products Partners have indicated that their planned offshore terminals will be capable of more than doubling that pace — to as many as seven supertankers in a week’s time.
Cheniere ramp-up fuels US LNG feedgas demand strength — US LNG feedgas deliveries remained near record levels Monday with Cheniere Energy continuing equipment testing on the second liquefaction train at its export facility near Corpus Christi, Texas, S&P Global Platts Analytics data showed. Commissioning of the unit is progressing well, a company spokesman said in an email responding to questions. The biggest US exporter of LNG produced from shale gas has been ahead of schedule with construction at the Texas terminal, as well as its Sabine Pass liquefaction facility in Louisiana. With as many as three more export terminals expected to start up in 2019, the US is on the verge of becoming a major player in the global supply of LNG. The additions and expansions are expected to more than double the amount of domestic LNG feedgas demand this year compared with 2018. The biggest question mark hanging over the US industry, and by extension market participants in Asia, Europe and Latin America, is how many new projects will be advanced by developers in what is shaping up to be a busy year for final investment decisions. To hit the early- to mid-2020s timeframe when global supply is forecast to be short, construction would need to start in 2019, or soon after. Shortly after Cheniere received Federal Energy Regulatory Commission approval last week to introduce fuel gas to its Corpus Christi Train 2, total deliveries to the terminal managed to exceed 700 MMcf/d for the first time and have now done so the last two days, Platts Analytics data showed. Overall, across Cheniere's two terminals and Dominion Energy's Cove Point terminal in Maryland, total US LNG feedgas demand Monday was about 5 Bcf/d, near the record level of almost 5.6 Bcf/d reached on Saturday, Platts Analytics data showed. Since exporting its first cargo December 11, feedgas deliveries at Corpus Christi have averaged 412 MMcf/d and the terminal has now exported a total of three cargoes, according to Platts' vessel tracker, cFlow. Platts Analytics estimates Train 1 at Corpus Christi will enter commercial service in February with Train 2 slated for August.
More US LPG export capacity on the way, part 2. - LPG exports out of Gulf Coast marine terminals averaged 1 MMb/d in 2018, a gain of 12% from 2017 and 35% from 2016. And, with U.S. NGL production rising steadily, 2019 is looking to be another banner year for LPG shipments to overseas buyers. The increasing volume of propane and normal butane — the NGL purity products generally referenced as LPG — is filling up the existing export capacity of the Gulf Coast’s six LPG terminals and spurring the development of a number of expansion projects. Today, we continue our blog series on propane and butane export facilities along the Gulf, West and East coasts, and what’s driving the build-out of these assets. As we said in Part 1, the U.S. flipped from being a net LPG importer to a net exporter seven years ago, in 2012. Since then, exports by ship have skyrocketed to more than 1.1 MMb/d in 2018, with the vast majority of that volume (about 92%, as of year-end 2018) being sent out of the half-dozen LPG terminals in coastal Texas and Louisiana. The rest of the exports-by-ship are flowing through either the Ferndale terminal in Washington State (red dot and lettering in Figure 1), the Marcus Hook facility near Philadelphia (green dot and lettering) or DCP Midstream’s Chesapeake terminal in Virginia (light blue dot and lettering). In the initial blog in this series, we also noted that the bulk of U.S. LPG exports have been bound for Asia and Latin America, with smaller but still-significant volumes sent to Europe, Africa and the Caribbean. We concluded Part 1 with a review of the Gulf Coast’s — and the U.S.’s — largest LPG export facility: the Enterprise Hydrocarbon Terminal (EHT; dark blue dot and lettering) on the Houston Ship Channel, whose capacity is in the midst of being expanded to 720 Mb/d from the current 545 Mb/d. EHT, which can also handle a number of other energy commodities, is connected by several pipelines to Enterprise Products Partners’ NGL fractionation and storage complex at Mont Belvieu; Enterprise owns all or part of nine existing fractionators (combined capacity, 755 Mb/d) at the hub and is building 300 Mb/d of additional fractionation capacity there that will come online in the first half of 2020. Today, we turn our attention to Targa Resources’ Galena Park Marine Terminal (aqua dot and lettering), also along the Houston Ship Channel, Phillips 66’s Freeport LPG Export Terminal (purple dot and lettering) down the coast in Freeport, and Energy Transfer’s export facility (yellow dot and lettering) in Nederland, TX.
U.S. oil export boom sparks a battle to build Texas ports (Reuters) - Booming U.S. oil exports have set off a scramble to build Gulf Coast ports to handle more than 3 million barrels per day in new supplies expected over the next five years. Of seven proposed oil-export projects, nowhere is the opportunity greater or the competition more fierce than in Corpus Christi, Texas, where three firms are vying to open the state’s first deepwater port. Commodities trader Trafigura has taken an early lead with a planned offshore facility that has an easier path to regulatory approval and faces fewer objections from environmentalists. Its chief competitor - a partnership of investor Carlyle Group and the Port of Corpus Christi to build an onshore port - has responded by petitioning regulators to kill Trafigura’s project. Port lobbyists have cited past criminal allegations involving the firm in other countries and potentially “catastrophic” environmental impacts. Rising demand for new ports follows a 2015 decision by the U.S. Congress to lift a 40-year ban on crude exports after advances in drilling techniques sparked a rapid rise in domestic shale production - especially in Texas. The United States had been the world’s top oil buyer for decades, and its port infrastructure was built to import rather than export. Now, surging exports threaten to overwhelm existing ports as U.S. production is projected to hit 12 million barrels per day (bpd) this year, up from 9.35 million in 2017.(U.S. crude producers send more shale oil to the world : tmsnrt.rs/2H48vJp ) “We’ve got a wave of oil headed toward the coast,” said Jeremiah Ashcroft III, chief executive of Lone Star Ports LLC, the Carlyle-backed company formed to develop its Corpus Christi project. Only one U.S. facility, the Louisiana Offshore Oil Port, can fully load supertankers capable of carrying 2 million barrels. The Corpus Christi port - the closest to the most prolific shale fields in Texas - exports less than 1 million bpd, and its harbor is too shallow to fully load supertankers. The market ultimately may support more than one new deepwater port, but the first firm to build near Corpus Christi will have the best shot at cutting long-term deals with producers expected to ship an estimated 2.1 million bpd to the region through new pipelines set to open this year.
Analysis: US product stocks rocket higher as refiners hit their stride and demand falters - Analysis: US product stocks rocket higher as refiners hit their stride and demand falters — US refined product stocks moved sharply higher last week amid surging refinery utilization, US Energy Information Administration data showed Friday. US distillate stocks increased 9.53 million barrels during to a 10-week high of 129.43 million barrels during the week-ended December 28, EIA data showed. Gasoline in storage also grew sharply, adding 6.89 million barrels last week to 239.99 million barrels, the highest level since mid-June. The stock builds far exceeded market expectations. Analysts surveyed for an S&P Global Platts analysis Wednesday said gasoline and distillate stocks each likely added just 1.6 million barrels last week. NYMEX refined product futures fell from intraday highs following the larger-than-expected inventory build, and settled mixed on Friday. February ULSD was 2.72 cents higher at $1.7692/gal, but February RBOB ended the session down 17 points at $1.3478/gal. The sharp rise in distillate stocks pared the nationwide deficit to the five-year average to 8.2%, in from 10.9% during the week prior, while the gasoline supply overhang extended, with storage moving to 4.3% above the five-year average. Distillate stocks were driven higher in part by strong refinery runs last week. Nationwide refinery utilization increased 2.1 percentage points to 97.2% of capacity, and net crude inputs surged 410,000 b/d to a 16-week high at 17.8 million b/d. Analysts surveyed on Wednesday had been expecting utilization rates to edge 0.3 percentage point higher to 95.1% of capacity last week. Refinery runs strengthened to above 90% of capacity across all regions last week. Atlantic Coast utilization surged to 91.8% of capacity, an increase of 8.4 percentage points from the week prior. Gulf Coast refinery utilization increased 1.4 percentage points to 99.4% of capacity, the strongest level reported for the last week of December since at least 2010. The uptick in refinery utilization pushed nationwide distillate production up 147,000 b/d to 5.59 million b/d, on par with the all-time record high production levels set in December 2017. But strong refinery runs failed to bolster gasoline output, and nationwide production fell 701,000 b/d to 9.64 million b/d.
Texas Snaps 2-Year Streak of Oilfield Job Growth-- Jobs in the Texas oil patch dropped for the first time in almost two years, according to the state’s workforce commission. The number of workers handling exploration and drilling duties fell by 500 to 247,700 in November compared with the previous month, according to the latest data from the Texas Workforce Commission. Snapping a streak of 23 months for oilfield expansion, the state is weathering volatile oil prices that have lost more than a third of their value since October. “We have seen tremendous growth in the oil and natural gas industry in Texas, including consistent job expansion, but growth is not guaranteed,” Todd Staples, president of the state oil and gas association, said Friday in a statement. Home to a pair of the world’s busiest shale oil fields -- the Permian Basin and the Eagle Ford -- the Lone Star State has yet to fully climb back to the high of 308,900 upstream workers reached at the end of 2014, before a decline in crude prices that lasted more than a year. The state’s data only covers so-called upstream jobs related to oil and natural gas extraction, excluding other large sectors such as pipelines and refiners. It’s subject to historical revisions later on, according to the Texas Oil & Gas Association. The Permian Basin lost jobs for a third straight month in November, the Federal Reserve Bank of Dallas said in a Dec. 28 report. Companies began laying off completion crews late last year due to maxed out pipes in West Texas, exhausted spending budgets and slumping crude prices.
New Data Suggests Shocking Shale Slowdown - U.S. shale executives often boast of low breakeven prices, reassuring investors of their ability to operate at a high level even when oil prices fall. But new data suggests that the industry slowed dramatically in the fourth quarter of 2018 in response to the plunge in oil prices.A survey from the Federal Reserve Bank of Dallas finds that shale activity slammed on the brakes in the fourth quarter. “The business activity index—the survey’s broadest measure of conditions facing Eleventh District energy firms—remained positive, but barely so, plunging from 43.3 in the third quarter to 2.3 in the fourth,” the Dallas Fed reported on January 3.The 2.3 reading is only slightly positive – zero would mean that business activity from Texas energy firms was flat compared to the prior quarter. A negative reading would mean a contraction in activity.The deceleration was true for multiple segments within oil and gas. For instance, the oil production index fell from 34.8 in the third quarter to 29.1 in the fourth. The natural gas production index to 24.8 in the fourth quarter, down from 35.5 in the prior quarter. But even as production held up, drilling activity indicated a sharper slowdown was underway. The index for utilization of equipment by oilfield services firms dropped sharply in the fourth quarter, down from 43 points in the third quarter to just 1.6 in the fourth – falling to the point where there was almost no growth at all quarter-on-quarter. Meanwhile, employment has also taken a hit. The employment index fell from 31.7 to 17.5, suggesting a “moderating in both employment and work hours growth in the fourth quarter,” the Dallas Fed wrote. Labor conditions in oilfield services were particularly hit hard.
Oil lobby frets over trade war -- The nation’s main oil lobbying group is growing increasingly concerned about the impacts to the industry from President Trump’s ongoing trade war. Mike Sommers, the American Petroleum Institute’s (API) president, said U.S. tariffs on steel and China’s tariffs on liquefied natural gas (LNG) are among the top concerns of oil and gas companies. “We want this dispute to end quickly,” Sommers told reporters Tuesday in advance of his "State of American Energy" speech, an annual event the oil industry group hosts in an attempt to set the energy policy agenda for the year. “We of course want to ensure that U.S. intellectual property is protected,” Sommer said, nodding to one of Trump’s main justifications for tariffs on China. “But at the same time, we have to do it in a way that doesn’t affect American economic leadership, that is really driven by American energy leadership.” Sommers told lawmakers, oil executives and lobbyists later at his speech that the trade war threatens to leave a “void” in world gas markets, since China would buy less gas from the United States. “It’s a void other countries are happy to fill,” he said. “Our position at API is pretty straightforward: fight back against anti-American trade practices. Just do it in ways that don’t undermine America’s economic leadership.” China last year put a 10 percent tariff on LNG from the U.S., and threatened to increase it to 25 percent. Also last year, Trump put a 25 percent tariff on imported steel in a bid to protect domestic steelmakers. Sommers said that’s hurting pipeline companies in particular, citing a Plains All-American Pipeline project faced delays and increased costs because of difficulty in buying steel. “This is a major issue for us. We’re working closely with the administration to clear this matter up,” he told reporters. Gretchen Watkins, president of Shell Oil, said trade barriers are especially disruptive if they impact ongoing projects. Susan Dio, president of BP America, said her company works with global supply chains. “It is important ... that we can actually move products and things across the supply chains very very effectively, and that does impact the investment decisions that we make.”
Problems for US Producers at $50 -- U.S. producers can’t generate cashflow and production growth at $50 per barrel oil. That’s what Virendra Chauhan of Energy Aspects outlined in a television interview with CNBC on Wednesday. “$50 oil is not a level at which U.S. producers can generate cashflow and production growth, so we do expect a slowdown there, and that’s going to set up for a constructive second half of the year we think,” Chauhan told CNBC in the interview. “I think there are select companies which will survive but as an industry … certainly at $50 per barrel the [shale] industry does not generate enough cashflow to be able to entice investors,” he added. In a Bloomberg radio interview on December 19, John Kilduff, founding partner of Again Capital Management LLC, outlined that we were getting into the zone where U.S. shale producers stop making money. “You’re getting into that zone now … particularly when you sort of add in all the costs, not just the pure say drilling and extraction methodology. That’s going to start to get tough for them right now,” Kilduff said in the interview at the time. “But they have been successful, many of them, particularly in the Permian Basin where they’ve driven breakeven costs down to around $35 to $40 a barrel,” he added. According to a report released on Monday from Rystad Energy, U.S. fracking activity slowed in the second half of last year. “After reaching a peak in May/June 2018, fracking activity in the Permian has gradually decelerated throughout the second half of 2018,” Rystad Energy senior analyst Lai Lou stated in the report. Chauhan analyzes global supply demand fundamentals, with a particular emphasis on upstream and shale, according to Energy Aspects’ website.
Fracking Jobs Peaked In June; So Did Flatbed Rates -On Monday, the energy data and consulting firm Rystad Energy released a report showing that daily fracking jobs for trucks reached a peak of 48-50 in May and June of 2018 before gradually declining to about 44 jobs per day in November. Because fracking is so trucking-intensive – the sand, water, and chemicals must be transported to a large number of shifting production sites – FreightWaves wanted to see if the same curve was present in flatbed trucking prices and tender rejections. Flatbed rates and and capacity tightness in oil patch-associated lanes tracked the story Rystad was telling fairly closely. "After reaching a peak in May/June, fracking activity in the Permian Basin has gradually decelerated throughout the second half of 2018," stated Rystad Energy senior analyst Lai Lou in a press release. According to DAT's RateView tool, broker-to-carrier spot rates for flatbed trucks experienced a similar deterioration after peaking in June or July. Flatbed trucks driving from Houston to Lubbock were taking $2.35/mile net of fuel in February, but that rate spiked to $2.91/mile in June before falling to $2.14/mile in November. The Houston to Oklahoma City lane was more volatile at $2.20/mile in February, peaking at $3.08/mile in July, before crashing to $2.03/mile in November. From Birmingham, Alabama, where major flatbed carriers are based, to Houston, flatbed rates started at $2.07/mile net of fuel in February, peaked at $2.84/mile in June, and fell to $1.85/mile over the past seven days. Finally, the Shreveport, Louisiana to Oklahoma City lane, which connects the Haynesville shale play with the SCOOP/STACK play, paid flatbeds $2.55/mile in February, $3.10/mile in June, and only $1.97/mile over the past seven days. It's worth noting that oil patch flatbed prices tracked the national rate to a certain extent, which bottomed in February at $2.00/mile, peaked at $2.42/mile in June, and fell to $2.01/mile in November. But the oilfield lanes are priced at a premium compared to national averages and are far more volatile – much more of a boom-and-bust environment.
US oil and gas rig count falls seven to 1138 in first full week of 2019 - The US oil and natural gas rig count fell by seven to 1,138 during the first full week of 2019, which saw oil prices recover some lost ground, breaking above the $50/b mark, S&P Global Platts Analytics data showed Thursday. The number of active oil rigs was unchanged at 897 this week, while the gas rig count dropped by six to 220. Also, a one-rig decline was seen in rigs not specified for oil or gas. In total, domestic plays have lost 95 rigs since the recent high of 1,233 in the middle of November. Front-month WTI crude hit the mid-$70s/b in early October, which may have incentivized activity. Click here for full-size graphic Analysts say a loss of more rigs would not surprise them, based on oil prices that fell more than 40% between those early October levels and late December, although prices have since regained some ground. On Thursday, front-month NYMEX crude futures settled at $52.59/b, up 23 cents day on day. "Rigs have come off slightly, but are generally flat with the end of last year," Platts Analytics analyst Taylor Cavey said. "A number of producers have already come out and said they were going to scale back from previous plans," given lower commodity prices, he said. While more information will be released in fourth-quarter 2018 conference calls, "I'd imagine we'd see more producers follow suit and scale back operations if prices remain low," he added. This week, the Permian Basin of West Texas/New Mexico saw the biggest activity increase, adding four rigs to reach a total of 478, with the other named basins unchanged, or up or down one or two rigs. Last weekend, Wells Fargo oilfield services analyst Jud Bailey estimated Lower 48 states drilling and completions spending for 2019 would see an 11% year-on-year decline, compared with a 1% increase predicted previously, owing to what he called lower oil prices and a "shaky macro backdrop." "Our revised spending scenario, which now assumes that E&Ps set initial spending plans [based on around] $47-$50/b WTI, drives a roughly 120-to-140 decline in [the] rig count from late December levels and a year-over-year decline in the horizontal rig count of 8% in 2019," Bailey said. For the week that ended Wednesday, Platts' WTI assessments averaged $49.14/b, up $3.65, while its WTI Midland assessment averaged $43.16/b, up $3.49 and the Bakken Composite averaged $48.51/b, up $6.12. For natural gas, Platts' Henry Hub assessment averaged $2.79/MMBtu, down 24 cents, while Dominion South averaged $2.52/MMBtu, down 19 cents. In addition, 334 more new drilling permits were procured domestically in the week that ended Wednesday than in the previous week, for a total of 1,764. The Permian had the largest number, about a third, or 109, for a total of 189. An additional 35 permits went to operators in the Eagle Ford Shale, for a total of 49, and 26 went to Haynesville Shale players for a total of 39.
Report- Oil & natural gas production continues to rise despite flat jobs growth - The Texas oil and natural gas industry appears to be doing more with less.Crude oil and natural gas production continues to rise despite flat job growth, a new report from the Texas Independent Producers & Royalty Owners Association reveals. Texas crude oil production reached 1.35 billion barrels through November 2018 — an increase of 209 million barrels compared to the same period in 2017, the association reported.December figures are still pending, but crude oil production is expected to surpass the 1.5-billion-barrel forecast for 2018.Natural gas production increased slightly for a total of 7.5 trillion cubic feet produced through November 2018. Most of the increased output came from the Permian Basin of West Texas, which has become the top shale play in the United States, the association reported.Despite the production gains, job growth stalled in November. The oil and natural gas industry added 10,000 new jobs in Texas between January and November but that jobs growth has slowed down amid lower crude oil prices. "Job growth in the Texas upstream sector was essentially flat in November compared to many months of consecutive growth," TIPRO President Ed Longanecker said in a statement. "A slowdown in employment was expected due to the impact of takeaway capacity constraints in West Texas, lower crude oil prices, added expense to E&P projects from increasing service costs, as well as rising material costs resulting from steel and aluminum tariffs. Ongoing innovation and efficiencies being utilized in the industry, expanding pipeline capacity, and an expedited resolution to trade disputes will support increased energy production and job growth for the state of Texas."
USAC jet fuel prices spike to 16-month high on supply woes — Jet fuel differentials on the US Atlantic Coast climbed to their highest levels in 16 months Monday as stock levels in the region continue to sag. S&P Global Platts assessed jet barrels on Buckeye Pipeline in New York Harbor at the NYMEX February ULSD futures contract plus 13 cents/gal. That was up 4 cents from Friday and highest since it reached plus 14.50 cents/gal on September 7, 2017.USAC jet fuel inventories fell 656,000 barrels to 8.29 million barrels, according to the latest US Energy Information Administration data. That was down just over a million barrels from the same period last year. "I'm having trouble finding sellers," a USAC distillates broker said.
Something Extraordinary Is Happening In Jet Fuel Markets -- Asia and the United States are experiencing historic prices for jet fuel, yet their current circumstances couldn’t be more opposite. In Asia, jet fuel has plummeted over the past two months to its biggest discount on record for this time of the year. At the exact same time, the United States Atlantic Coast is being hit by the highest jet fuel prices in the region in more than a year. The cash differentials for jet fuel cargoes in Singapore, a major port for Asian trade, hit a discount of $1.34 a barrel as compared to benchmark quotes earlier this week. This means that prices for January are at their putting them at their weakest since at least 1998, when Refinitiv Eikon started collecting this type of data. The jet fuel cash differentials recorded in Singapore have more than quadrupled over the last two months, also hitting their lowest level since August 2015 on a daily outright basis. In Asia, the drop in jet fuel prices is in large part thanks to a supply surge and a relatively warm winter, which is keeping demand for kerosene (an important component of jet fuel) lower than in past years. Temperatures in some of the region’s most populated cities, including Tokyo, Beijing and Shanghai, are expected to remain unseasonably warm for the next few weeks. Even in colder North Asia, where kerosene is generally widely used to heat homes during these months, there have been no prolonged cold snaps so far this year. The price of East-Asian jet fuel could pick up in the next few months if the cold weather finally comes in or with the significant spike in demand that’s expected to come with the major travel surge around Lunar New Year. The holiday will land on Feb. 5-6 this year. In India, state oil companies also cut the price of aviation turbine fuel by nearly 15 percent, the second consecutive drop in Indian jet fuel prices. In fact, the drop in aviation turbine fuel prices in India is so significant that jet fuel is now cheaper than both gasoline and diesel in most parts of the country. Meanwhile, in the eastern United States, jet fuel differentials have risen to their highest levels in 16 months in the face of a stock slump across the region. United States Atlantic Coast (USAC) jet fuel inventories have plummeted 656,000 barrels to a total supply of just 8.29 million barrels according to numbers from the most recent US Energy Information Administration data. This makes the region’s overall jet fuel reserve more than a million barrels less than during the same time period last year. “I'm having trouble finding sellers," one USAC distillates broker told S&P Global.
Texas Hill Country landowners fight Kinder Morgan pipeline - Hank Sauer, a retired health care administrator, 84, had lived on the property with his wife. But she suffered health problems, and the couple moved into an assisted-living facility in San Antonio. Sauer is worried that a natural gas pipeline proposed by Houston-based Kinder Morgan, one of the largest pipeline companies in the country, will reduce his land’s value. He’d been looking to sell the property, but said he recently pulled it off the market because interest dropped off after Kinder Morgan announced the project. He was seeking to sell the land for just under $1 million. “We have no ill will toward pipelines — they’re needed. But put them somewhere where they’re not going to destroy lives and destroy people’s communities,” said Sauer, who describes himself as “very conservative.” Kinder Morgan is surveying the possible route and lining up agreements with property owners. If the company receives the necessary permits and approvals, it wants to start construction by this fall and open the pipeline at the end of 2020. Agencies that will review the project include the Texas Railroad Commission, U.S. Fish and Wildlife Service, U.S. Army Corps of Engineers and the Texas Commission on Environmental Quality. The company’s proposal — and simmering fight with landowners in the pipeline’s path — comes as pipeline operators pump billions of dollars into major projects to eliminate a shortage of pipelines to transport oil and gas from America’s largest oil field. Pipeline companies such as Kinder Morgan can legally seize private land for their projects through eminent domain, though they’re required to fairly compensate owners for the property. That has landowners in the Hill Country scrambling to learn their rights and figure out what they can do to either reroute or stop the pipeline. Kurt Sauer, one of Hank’s sons and a lawyer, said he finds it hard to understand why the state gives pipeline companies the ability to use eminent domain.“I missed that class in law school that not only can government take your property and build a road or a pipeline but now some private companies get to take your property without considering anything, or without you getting to have any say in it whatsoever,” he said.
Walz administration reconsidering lawsuit against Enbridge pipeline project - Under former Gov. Mark Dayton, Minnesota’s Department of Commerce put up a strong fight against a controversial proposal for a crude oil pipeline in northern Minnesota, even as the project won approvals and permits from state regulators.But whether that approach will continue under Gov. Tim Walz, who was sworn in earlier this week, is now unclear. The fledgling DFL administration is evaluating whether to proceed with a key lawsuit challenging the Line 3 pipeline plan from Calgary-based Enbridge, Steve Kelley, the Commerce Commissioner, said on Wednesday. Kelley, a former DFL state senator, was appointed by Walz last week.“The governor has asked the department to take another look, with the change of administrations, at the Enbridge litigation, and that’s my responsibility to do,” Kelley said during a panel discussion hosted by the Minnesota Chamber of Commerce. “And let’s say I just haven’t finished that job in the last two days.”The Line 3 project has drawn passionate debate, pitting environmentalists concerned about fossil fuel emissions and the safety of transporting crude oil through Minnesota’s lake country against some businesses and trade unions who say the new pipeline will bring an economic boost in Greater Minnesota. Protests against the pipeline have already erupted on a few occasions since Walz was elected, most recently in the middle of a speech Walz was giving in the Capitol shortly after being sworn in. A large group of unions, politicians, businesses and local chamber of commerce officials said they planned to hand deliver a letter to Walz’s office on Thursday morning urging the governor to withdraw the state lawsuit against Line 3. Enbridge says the new 36-inch pipeline, known as Line 3, is necessary to replace an aging 34-inch pipeline that is corroding and operating at roughly half capacity. If built, the $2.6 billion, 337-mile Minnesota portion of the new Line 3 would carry roughly 760,000 barrels of oil per day through the state. The state’s independent Public Utilities Commission granted Enbridge two key approvals last year — a Certificate of Need and a route permit. But the Commerce Department appealed that Certificate of Need in December, arguing Enbridge had not adequately shown the pipeline is necessary to meet state demand for oil, according to a written statement issued by Dayton at the time.
Oil drillers, nature lovers get access to public lands despite shutdown -- Food is going uninspected by regulators. Time-sensitive data is going uncollected by scientists. And other federal workers are going without pay while doing critical work manning airport terminals and border crossings. While the partial government shutdown’s effects reverberate throughout the federal bureaucracy, the Trump administration is actively working to ease the impact on wilderness lovers and oil drillers alike. Officials at the Interior Department have made a conscious effort to pursue two priorities President Trump has emphasized in his time in office — energy exploration and access to public lands — during the shutdown, according to a top department official who spoke on the condition of anonymity in order to talk frankly. The Trump administration’s prioritization of energy exploration means the oil and gas business, one of the most heavily regulated industries in the United States, says it has yet to feel any real consequence from the shutdown.“To this point, we have not seen any major effects of the shutdown on our industry,” Mike Sommers, president and chief executive of the oil and gas business’s chief lobbying organization, the American Petroleum Institute, told reporters Tuesday.The department’s Bureau of Land Management, for example, has accepted and published 22 new drilling permit applications in Alaska, North Dakota, New Mexico and Oklahoma between the start of the shutdown and Wednesday afternoon. Officials said they did not anticipate any delays in the processing of either permit applications or requests for inspections of drilling operations on federal land.The Bureau of Energy M anagement, which gets a large portion of its budget from fees, is operating at near full strength. Nearly every job is exempt “in order to comply with the administration’s America First energy strategy” and expand leases to the oil and gas industry -- “work must continue toward” selling leases that could lead to drilling on the outer continental shelf, according to the agency’s contingency plan. But elsewhere the department says it is not even accepting other sorts of filings — such as public-records requests from journalists, activists and other members of the public made under the Freedom of Information Act — due to the shutdown.
Climate Activists Keep the Pressure on Polis With Anti-Fracking Petition - With a little less than 24 hours to go before his inauguration, Governor Jared Polis got a polite but firm reminder from environmental activists about the issues that could very well define his time in office: fracking and climate change. With inaugural banners already hanging outside, representatives from 350 Colorado, Colorado Rising and a half-dozen other groups paid a visit on Monday, January 7, to Polis’s new digs at the State Capitol, where they delivered a petition calling on Colorado’s incoming governor to take action against the oil and gas industry. “We’re very concerned, obviously, about the climate crisis,” Micah Parkin, executive director of 350 Colorado, told a Polis staffer in a brief meeting; activists were told the governor-elect wasn’t available to receive the petition in person. “We know the governor cares about these issues, and we hope he’ll take this very seriously.” Polis spokeswoman Maria De Cambra said that the incoming administration hadn’t had time to review the petition amid preparations for today's inauguration, and declined to comment on its demands. Polis will be inaugurated today, January 8. The petition, signed by more than 5,000 people and endorsed by 180 organizations from across the state, calls on Polis to take “immediate and meaningful actions” to protect Coloradans from both the health and safety hazards posed by fossil-fuel extraction and the long-term risks of climate change. Activists are calling for a moratorium on drilling permits until new regulations can be put in place, and the petition’s demands offer a glimpse at where Colorado’s long-running battles over fracking could be headed as Polis and the new Democratic majority in the state legislature take over.
Weld County oil and gas spill report for Jan. 6 - The following spills were reported to the Colorado Oil and Gas Conservation Commission in the past two weeks. Information is based on Form 19, which operators must fill out detailing the leakage/spill events. Any spill release that may impact waters of the state must be reported as soon as practical. Any spill of five barrels or more must be reported within 24 hours, and any spill of one barrel or more, which occurs outside secondary containment, such as metal or earthen berms, must also be reported within 24 hours, according to COGCC rules. Spills and leaks typically are found during routine maintenance on existing wells, though some actual “spills” do occur among the 23,000-plus wells in the county.
- • PDC ENERGY INC, reported Dec. 31 a tank battery spill about 6 miles northeast of Kersey, near Weld County roads 64 and 61. An unknown amount of oil and between five and 100 barrels of produced water spilled. A water vault valve failure released the produced water and oil inside containment.
- • BONANZA CREEK ENERGY OPERATING COMPANY LLC, reported Dec. 29 a tank battery spill about 10 miles northwest of Orchard, near Weld roads 62 and 89. About 10 barrels of oil spilled. A dump valve on a vertical scrubber froze in the open position, causing the production tanks to overpressure and spill oil inside containment.
- • KERR MCGEE OIL & GAS ONSHORE LP, reported Dec. 28 a historical tank battery spill about 7 miles northeast of Fort Lupton, near Weld roads 22 and 41. Less than five barrels of oil, condensate and produced water spilled. Waters of the state were impacted. A groundwater sample indicated benzene and total xylene concentrations of 358 μg/L and 10,000 μg/L respectively.
- • WHITING OIL & GAS CORPORATION, reported Dec. 25 a tank battery spill about 7 miles northwest of Avalo, near Weld roads 120 and 133. About nine barrels of produced water spilled. Crews found the spill during operations, and the underground produced water transfer line was isolated.
- • EXPEDITION WATER SOLUTIONS COLORADO LLC, reported Dec. 23 a well pad spill about 3 miles northeast of Firestone, near Weld roads 20 and 19. Between two and three barrels of oil-based mud spilled. The oil-based mud hauler failed to completely close the valve on the back of his truck.
- • VERDAD RESOURCES LLC, reported Dec. 23 a tank battery spill about 3 miles northeast of Keota, near Weld roads 100 and 109. Between one and five barrels of oil spilled. A leak formed in a line to a tanker truck, spilling oil on roadbase.
US Shale Drilling Activity Slowed in 2H 2018- After peaking in mid-2018, U.S. fracking activity slowed in the second half of 2018, according to a report released Jan. 7 by Rystad Energy. The nation’s shale drilling activity was stable from April to August 2018 with an average daily level of 48 to 50 fracked wells. However, activity slipped to 44 jobs per day in November 2018. “After reaching a peak in May/June 2018, fracking activity in the Permian has gradually decelerated throughout the second half of 2018,” Rystad Energy senior analyst Lai Lou stated in the report. Lou added that seasonal activity deceleration began in November for all major plays except the Eagle Ford. But some operators weren’t a part of the deceleration as the report notes major ExxonMobil experienced a strong uptick in fracking activity in October 2018. Energen Corporation was also unmoved by the slowdown. “In general, many of the key operators have exhibited a largely flat trend from June to October 2018, which implies that the market-wide deceleration in fracking activity has a more significant implication for smaller operators in contrast to the major players in the Permian,” Lai said. “In terms of absolute numbers, the reduction in the number of jobs for top 10 operators collectively is around 10 percent from June to October while the corresponding percentage for the remaining operators is as high as 48 percent in the same timeframe.”
U.S. fracking fell 12% from midyear, report says - U.S. shale activity dropped by more than 10 percent from a midyear peak to November, according to a new report Monday from the Norwegian research firm Rystad. Energy companies completed about 50 shale wells per day in the U.S. in June and that number slipped down to 44 wells hydraulically fractured, or fracked, and completed by the end of November, Rystad estimates. Oil prices plunged about 40 percent from early October through December, and pipeline shortages in West Texas' booming Permian Basin have slowed fracking activity in the region. In fact, well completions activity seemingly dropped everywhere except South Texas' Eagle Ford shale, which is nearer Gulf Coast port and refining hubs with ample pipeline capacity already in place, Rystad concluded. "After reaching a peak in May and June '18, fracking activity in the Permian has gradually decelerated throughout the second half of 2018," Rystad senior analyst Lai Lou said. "There has been a considerable slowdown in Bakken and Niobrara in November based on our estimation," Lou added, citing the major shale plays in North Dakota and Colorado, respectively. Rystad also concluded that smaller operators face much bigger impacts. The biggest player, Exxon Mobil, even bucked the trend and increased fracking activity in October before slowing down in November. In general, major operators have declined about 10 percent since midyear, while smaller players have cut back as much as nearly 50 percent, according to Rystad.
US Fracking Wells Are Producing Far Less Than Forecast - According to a new report by the Wall Street Journal, thousands of shale oil wells that have been drilled over the last five years are pumping less than what was forecast to investors. The new discovery has raised questions about the strength behind the United States' newfound supply of shale oil. The WSJ compares well productivity estimates that were disclosed to investors versus public data of how these wells have performed to date; after analyzing 16,000 wells operated by 29 producers in places like North Dakota and the Permian basin, the Journal found that about 66% of projections made by companies between 2014 and 2017 are reportedly "overly optimistic". In total, these companies are set to pump about 10% less oil and gas than was forecast, an amount which equates to about 1 billion barrels of oil and gas over 30 years, which would be priced at about $30 billion at current market prices. In some regions, companies are reportedly off track by more than 50%. As previously discussed, the US shale boom has been one of the main reasons that the US has become an oil superpower over the last couple of years, while trimming the US reliance on foreign oil to virtually nothing. But now shale drillers are under pressure to cut spending, as oil prices have cratered almost 50% in the last three months. Two companies that operate in the Permian basin, Pioneer Natural Resources Co. and Parsley Energy are among the main culprits lagging behind forecasts (the analysis excluded several oil conglomerates like Exxon, because they didn’t make shale projections). That said, Pioneer and Parsley disputed the report's findings, saying that the lifespan of wells was different from forecasts, while other companies like Whiting Petroleum Corp. simply stated that the forecasts can be unreliable and that they were going to move away from providing them. Certainly an easy thing to say now that investments have been made. Another driller, Oasis Petroleum Inc., tried to hide behind accounting-style excuses, stating about projections: “It’s not a science, it’s more of an art.” Prior to the shale boom in 2007, oil companies were valued close to their reserves. Now these companies, on average, are valued almost three times higher. It is no secret that shale companies have taken a significant amount of capital from Wall Street over the last 10 years - mostly in the form of junk bonds - and investors have mostly lost money. Since 2008, an index of United States based oil and gas companies was down 43% while the stock market has doubled in the same time. The article examined 29 companies which collectively spent $112 billion more in cash than they have generated from operations over the last decade.
Producers weigh DUC production at $50/b oil - — The volume of drilled but unproduced wells continues to build across the US to record levels, but market sentiment is mixed on whether oil prices need to continue to recover from levels now around $50/b to entice new production. As the price of oil began to slip early in Q4 2018 from the mid-$70s/b, many upstream operators projected they would begin producing their DUC inventory in early 2019. But oil has since slid to mid-2017 levels and producers' views may have changed. On Wednesday, front-month WTI crude futures settled at $52.36/b, up $2.58 on the day, as prices continued to climb for a recent low of $44.61/b December 27. While crude prices have trended higher, market-watchers are mixed on what will induce operators to begin producing banked wells. "The lower oil price raises some questions about whether you go ahead with completing these wells," "Some companies want to get them in a producing mode; others say they won't get an adequate return right now, so they'll wait." Operators consider DUC production a bargain. Roughly 30%-40% of a well's total cost is drilling, so paying less when it comes time to produce is an attractive prospect, especially when oil prices are lower and they want to maximize cash flows. If 2019 oil prices are weak, "DUCs will likely have extra significance in helping [operators] maintain or grow production volumes," Even though the DUC count rose last year, some companies may have begun completing and producing their banked well inventories before oil prices dropped, Thummel noted US oil production in 2018 was larger than expected and the oil rig count also rose last year, but not enough to support such a large output growth spurt. As a result, "there had to be a lot of DUCs completed" last year, Thummel said. "That may have been part of why we were able to grow production so much. It's not as if [individual] wells produced much more than anticipated." Evercore ISI noted in its 2019 Global E&P Spending Outlook released last month E&P operators drilled more than 15,000 wells in seven major US shale basins during the previous year, but completed less than 13,000 as DUC inventory increased by nearly 30%. Ultimately what operators do will depend on how long oil prices remain pressured and how much takeaway capacity is available to bring onshore oil to lucrative US Gulf Coast markets. That is especially true in the Permian Basin of West Texas/New Mexico, where pipelines are now about full. According to the US Energy Information Administration, there were 8,723 domestic oil and natural gas DUCs in November 2018, with 4,039 of those, or 43% of the nationwide total, in the Permian.
Attorneys debate constitutionality of Lake Sakakawea mineral law — An attorney representing a group of North Dakota taxpayers argued Friday that a law approved by legislators two years ago “gives away” $2 billion in state oil and gas mineral assets and should be declared unconstitutional. But attorneys representing North Dakota said the legislation being challenged is not a giveaway, but a process to define the boundary and extent of the state’s mineral interests. East Central Judicial District Judge John Irby heard legal arguments for more than two hours on Friday in the lawsuit brought by Rep. Marvin Nelson, D-Rolla, former Republican governor candidate Paul Sorum and others. The case against the state of North Dakota challenges the act approved by legislators in 2017 known as Senate Bill 2134 that sought to resolve disputes over the ownership of oil and gas minerals under Lake Sakakawea. The taxpayer plaintiffs argued that Irby should declare the act unconstitutional and invalid while the state argued the lawsuit should be dismissed. The taxpayer plaintiffs argue the state owns the minerals under the Missouri River, including lands submerged by the construction of the Garrison Dam, which created Lake Sakakawea. Attorney Terrance Moore, representing the taxpayers, said the legislation transfers about $200 million in oil and gas revenue from state taxpayers to a select group of private parties.
Activist seeks dismissal from pipeline racketeering lawsuit (AP) — An American Indian and environmental activist named in a federal racketeering lawsuit says her opposition to the Dakota Access oil pipeline was constitutionally protected free speech, not an attempt to incite violence as the company alleges. Krystal Two Bulls asked a judge in a court filing last month to dismiss her from the lawsuit filed by Texas-based Energy Transfer Partners, which built the $3.8 billion pipeline to move North Dakota oil to Illinois. The company’s $1 billion lawsuit filed in August 2017 and revised in August 2018 claims environmental groups and five individuals, including Two Bulls, interfered with company business, facilitated crimes and acts of terrorism, incited violence, targeted financial institutions that backed the project, and violated defamation and racketeering laws. ETP’s lawyers maintain that Two Bulls was a key player in the Red Warrior Camp, an aggressive faction of pipeline protesters the company labels “a front for eco-terrorists.” The Standing Rock Sioux Tribal Council ultimately asked the group to leave the protest area near its reservation in southern North Dakota in late 2016. Two Bulls’ attorneys argue in court documents that her anti-pipeline activism was not illegal. “Plaintiff’s attempt to recast Ms. Two Bulls’ lawful advocacy as racketeering is nothing more than an attempt to punish and chill political speech plaintiffs do not like,” they said.
Judge allows tribes to challenge Corps’ Dakota Access study (AP) — A federal judge is allowing four Native American tribes in the Dakotas to challenge the recent conclusion of federal officials that a Dakota Access oil pipeline spill wouldn’t unfairly affect them, further prolonging a court case that has lingered for more than two years. The Standing Rock, Cheyenne River, Yankton and Oglala Sioux sued in July 2016 and are still fighting even though the $3.8 billion pipeline began moving North Dakota oil to Illinois in 2017. They fear environmental harm should the pipeline spill into the Missouri River, which they rely on for drinking water, fishing and religion. U.S. District Judge James Boasberg in June 2017 ordered the Army Corps of Engineers to do more study on the pipeline’s impacts on tribes. The agency last fall completed more than a year of additional work that it said backed up its earlier determination that the pipeline does not pose a higher risk of adverse impacts to minorities. The tribes contend the Corps has simply rubber-stamped earlier conclusions that were welcomed by President Donald Trump after he took office. The tribes maintain the Corps either didn’t allow them adequate input or didn’t give enough weight to the information they provided. The Corps has said the tribes have been difficult to work with. Tribes late last year asked to challenge the Corps’ 140-page report on its additional work. Boasberg, in a ruling dated Thursday, said he will allow it but that the Corps and Texas-based pipeline developer Energy Transfer Partners can oppose the introduction of any new tribal claims not specifically related to the additional study. The Corps and ETP had said in late December that they would not try to block tribal challenges as long as the judge made that stipulation. Boasberg has set a Jan. 31 deadline for the Corps to give the tribes access to all of the documents it used in making its decision.
Oil, brine spill at Williams County well contained on site (AP) — A tank overflow at a well in Williams County spilled nearly 1,700 gallons of oil and 11,000 gallons of byproduct saltwater. Complete Energy Services reported the spill Wednesday at a well about 6 miles southeast of Tioga. The state Oil and Gas Division says the oil and brine were contained on site and all of it has been recovered. A state inspector has been to the site and will monitor any additional cleanup.
TransCanada Hopes to Start Construction on Keystone by Summer -- TransCanada Corp. is hoping to start construction by June on its decade-old Keystone XL oil pipeline project, even as the U.S. government shutdown threatens to delay a key legal proceeding. In a court filing on Monday, the Calgary-based pipeline company said its current schedule requires pre-construction activities including setting up pipe yards and work camps to resume by February. That would allow full work to begin by June and be completed in late 2020, with the pipeline entering service in early 2021. TransCanada reiterated that a yearlong delay would cost the company $949 million in lost profits and delay the hiring of about 6,600 workers. The company would also face higher construction costs as competition for crews increases in 2020, TransCanada said in a letter filed in U.S. District Court in Montana. The 1,200-mile (1,900-kilometer) pipeline, which would help carry 830,000 barrels of crude a day from Alberta’s oil sands to U.S. Gulf Coast refiners, has faced legal holdups amid staunch opposition from environmental groups and landowners. The same court last month sided with environmental groups opposing the project and said TransCanada couldn’t resume field work while it awaited a new environmental review from the U.S. State Department. Prior to that ruling, TransCanada had hoped to start construction as early as mid February. A hearing is scheduled for Jan. 14, though the Justice Department -- which is representing the State Department in the proceedings -- lacks funding due to the partial government shutdown. TransCanada asked the court to move forward with that hearing without the Justice Department, a move the agency supported in a separate letter.
US government says shutdown shouldn't stop Keystone hearing --The U.S. government shutdown may prevent Justice Department attorneys from going before a Montana judge next week to ask him to lift his hold on Keystone XL oil pipeline construction.But the federal attorneys and the Canadian company that wants to build the pipeline say their absence shouldn't delay Monday's hearing on the matter in U.S. District Court in Great Falls. Justice Department attorney Bridget McNeil said in a court filing Monday that government lawyers are prohibited from working except in emergencies during the shutdown. But, she added, federal attorneys' participation in the hearing shouldn't be necessary. "The company believes that the potential absence of the federal government at the hearing does not provide cause to delay the matter," attorney Peter Steenland Jr. told the court in a filing last week.In November, Morris ordered an injunction prohibiting TransCanada from any pipeline construction activities and some pre-construction activity. The judge ruled that the Trump administration had not fully considered the environmental effects when it approved a permit to build the 1,184-mile (1,900 kilometer) pipeline from Alberta that would ship up to 830,000 barrels a day of crude oil to the Gulf Coast.TransCanada appealed Morris' ruling last month to the 9th U.S. Circuit Court of Appeals. On Monday, the company plans to argue that Morris' order blocking construction should be stayed while that appeal is pending, "with the goal of preserving the 2019 construction season," according to the company's request. Norrie Ramsay, a TransCanada vice president, said in a sworn statement that the company laid off about 650 contract workers from pre-construction activities as a result of Morris' order. If pre-construction activities resume by March 15, the company could still begin construction by Aug. 1, he wrote. Any later, and the company would be unable to perform any construction in 2019, creating a one-year delay that would add significant costs to the project, he wrote.
South Dakota County Secures More Jail Cells to Prepare for KXL Pipeline Protests - Officials from a South Dakota county secured more jail cells to prepare for potential protests of the controversial Keystone XL (KXL) pipeline, the Black Hills Pioneer reported.Last month, the Butte County Commission in South Dakota approved an agreement to use Faulk County jails for $85 per day per detainee, should the demonstrations go ahead and if protestors are arrested. Faulk County is roughly 270 miles east of Butte County.The KXL's planned route will cross through the northeastern corner of Butte County."The only reason we did it was kind of an insurance thing," Butte County Commissioner Stan Harms said Monday, as quoted by the Rapid City Journal. "We don't have a jail in Butte County. We normally use Sturgis, and if we can't get in there, the overflow goes to Deadwood or Rapid City. Now, we have Faulk County in case everything is full up."The arrangement was made even though a federal judge blocked construction of the long-gestating project in November. Despite the judge's orders, TransCanada plans to start construction on the $8 million tube this year, according to the AP. The developer remains "committed" to building the 1,179-mile pipeline designed to carry 830,000 barrels a day of tar sands oil from Alberta to Nebraska.
Gas pulled from Aliso Canyon storage for first time this winter — The Aliso Canyon natural gas storage facility, which has seen limited use for almost three years, has again been pressed into service, according to Southern California Gas. "Due to cold weather over the last week and high customer demand for natural gas, all SoCal Gas storage fields, including Aliso Canyon, have been used to provide system reliability," the company said on its web site. The withdrawal had little effect on spot gas prices, which were coming off a three-week high reached Tuesday when SoCal Gas city-gates hit $7.65/MMBtu. The last time it finished higher was December 10, when it closed the day trading at $8.535/MMBtu. On Thursday that pricing point shed 99.5 cents to come in at $6.655/MMBtu. In Friday trading, it was off another 80 cents to $5.86/MMBtu. The withdrawal prompted SoCal Gas to issue a system-wide notice stating it would work with California balancing authorities to reduce power generation demand on the SoCal Gas system for Monday, boosting Southern California day-ahead power prices. SP15 on-peak day-ahead was up $3, trading in the mid-$40s/MWh area for Monday delivery. CONSTRAINTS This is the first withdrawal from Aliso Canyon this winter. The storage facility has been under capacity and withdrawal constraints since February 2016 following a leak at the site that took several months to repair. The facility can deliver about 1 Bcf/d. But California regulators have said gas cannot be taken out of Aliso Canyon except as a last resort. That point came Thursday. Los Angeles saw temperatures peak in the upper 60s and lows were in the low 40s, which would give a boost to demand as customers used their furnaces. Demand was also affected by other areas of Southern California, as some inland cities, such as Riverside, saw temperatures drop into the 30s, further boosting need. Demand in the SoCal Gas footprint has been at high levels since the start of the year, topping the 4 Bcf/d mark three times and averaging 4.136 Bcf/d. By contrast, the company's December demand averaged 2.691 Bcf/d. Withdrawals from Aliso Canyon could continue as long as the cold weather persists, the company said.
Another Cold Delay Hits Gas - Stop us if you've heard this before: Cold later in January was delayed yet again over the weekend, sending the February natural gas contract over 3% lower on the day. The role of weather was incredibly evident with all the losses right at the front of the natural gas futures strip. The result was that the G/H February/March contract spread approached lows previously set last week. Following a bearish EIA print last Friday, it was weather that seemed to keep prices buoyed. That catalyst was eliminated over the weekend, as in our Morning Update we highlighted a significant weekend GWDD loss which led to the Sunday evening gap lower. In our Natural Gas Weekly Update published after that Morning Update we outlined our expectation for how weather forecasts will change through the week as well as what kind of balance Thursday's EIA print may reveal following last Friday's very bearish print. Of note was a recent significant tick higher in natural gas Salt storage. We also outlined what the latest Nino and tropical forcing developments could mean for weather model guidance this week, and compared our long-range forecast to the Week 3-4 forecast of the Climate Prediction Center. Finally, in our Afternoon Update we ran through afternoon weather model guidance and expected overnight trends, showing that generally afternoon model guidance fit expectations with Climate Prediction Center Week 2 forecasts little-changed.
Production Dip Keeps Gas Firm - The February natural gas contract logged a small gain on the day, with colder mid-day weather model runs being canceled out by warmer European model guidance into the settle and limiting the gain to just under 1%. This February gain was in line with what we saw for most contracts in 2019, and it was actually the summer contracts that were the strongest on the day. The March contract meanwhile logged a small loss. The result was a large move higher in the February/March contract spread back to recent highs. Meanwhile, the famed March/April H/J spread actually fell to new lows on this March weakness today. Prices were initially quite strong on overnight GWDD additions that we outlined in our Morning Update. This followed a turn in our sentiment to "Slightly Bullish" in our Afternoon Update yesterday, which verified well as prices shot over $3 multiple times today. Of note was a recent dip in production since the new year, which has kept supply more limited. After ramping into the new year, year-over-year production growth is only sitting around 9 bcf/d right now. This could help increase upside in gas prices if it persists and weather forecasts trend colder; we outlined the possibilities of this in our Note of the Day, Afternoon Update, and subscriber live chat. We also released our Seasonal Trader Report today, where we looked at our forecast through the remainder of winter and considered the impacts of a recent weakening in El Nino conditions.
U.S. natural gas prices sink on mild weather and hedge fund sales - (Reuters) - U.S. natural gas prices have fallen sharply as the unusual cold weather of late November and early December has given way to warmer-than-normal temperatures in the last four weeks. Futures prices for gas delivered at Henry Hub in February 2019 have fallen below $3 per million British thermal units from a peak of almost $4.80 in the middle of November. The exceptional rally in gas prices during the late summer and early autumn has unwound, leaving gas prices back at the low level that has prevailed for the last three years (https://tmsnrt.rs/2RIgtvy ). Cumulative heating demand for the 2018/19 heating season was around 6 percent higher than the long-run average through Dec. 12, according to the U.S. government Climate Prediction Center. But the sustained period of cold in late autumn and early winter has been replaced by an extended period of mild weather and cumulative heating demand has now dropped 4 percent below normal ("Degree days statistics", CPC, Jan. 8). Government forecasts show average or above-average temperatures expected across most of the major population centres of the United States for much of the next three months. So far this winter, gas stocks have fallen much less for any given level of heating demand than in the previous heating seasons, which has also helped rebalance the market. Surging gas prices have encouraged electricity generators to run gas-fired units for fewer hours in the fourth quarter and turn to coal-fired units instead, cutting gas consumption and making scarce stocks go further. Working gas stocks in underground storage were 726 billion cubic feet (20 percent) below the previous five-year average in mid-December, according to data from the U.S. Energy Information Administration. By the end of the year, however, the deficit had eased to just 561 billion cubic feet (14 percent) due to warmer weather and a reduction in hours by gas-fired generators ("Weekly natural gas storage report", EIA, Jan. 4).
Natural Gas Price Adds to Gains Following Inventory Report - The U.S. Energy Information Administration (EIA) reported Thursday morning that U.S. natural gas stockpiles decreased by 91 billion cubic feet for the week ending January 4. Analysts polled by Reuters were expecting a storage withdrawal in a range of 50 billion to 115 billion cubic feet. The five-year average for the week is a withdrawal of 182 billion cubic feet, and last year’s withdrawal totaled 359 billion cubic feet, an all-time record driven by extremely cold weather along the east coast. Natural gas inventories fell by 20 billion cubic feet in the week ending December 28.Natural gas futures for February delivery traded up about five cents in advance of the EIA’s report, at around $3.03 per million BTUs, and rose to around $3.06 after the report was released. For the period between January 10 and January 16, NatGasWeather.com expects “moderate” demand and offers the following outlook: A strong cold front will push across the Great Lakes and Northeast the next several days with lows reaching the 0s to 20s for strong demand. However, much of the rest of the country will be mostly mild with highs of 40s to 70s to counter. Weather systems with rain and snow will track into the West Coast with rain and snow, but with only slight cooling. This weekend into early next week will bring weather systems across the southern and eastern US with rain and snow, followed by warming mid next week. Total U.S. stockpiles increased week over week from about 14.3% to 7.2% below last year’s level and also rose from about 17.2% to 15.1% below the five-year average. The EIA reported that U.S. working stocks of natural gas totaled about 2.614 trillion cubic feet at the end of last week, around 464 billion cubic feet below the five-year average of 3.078 trillion cubic feet and 204 billion cubic feet below last year’s total for the same period. Working gas in storage totaled 2.818 trillion cubic feet for the same period a year ago.
Larger Gas Storage Draw Can't Get Prices Moving - Gas prices got going early this morning, running up towards $3.1 resistance before reversing lower into the morning's EIA natural gas storage number. Despite a fairly bullish number prices continued lower through the afternoon as the physical market lagged, with the February contract settling down about half a percent on the day. As has been the case all week, it was the March contract that lagged the most through the day. This move came despite the EIA announcing a -87 bcf net implied flow of natural gas from storage next week compared to our estimate of -75 bcf. Another 4 bcf of gas was reclassified from working to base gas, resulting in a weekly net storage change of -91 bcf. Yet not even this could save gas prices, as cash prices sunk through the morning and afternoon GEFS model guidance decreased cold risks slightly (images courtesy of Tropical Tidbits). Still, it was a jumpy day where the main story continues to be summer gas strength versus March weakness, with the February contract stuck in between as the February/March G/H spread continues ticking higher. Meanwhile, the H/J March/April spread continues to sell off and is now inside the historical range of the last few years. This comes as, even with today's slightly larger storage number, storage levels fell far less than the 5-year average of -187 bcf. Additionally, though the print was tighter than last week's pull and expectations, it was still loose to the last 10 weeks on aggregate. Now traders are focusing back on long-range weather expectations and the latest daily balance developments to determine the next move for gas prices. Despite daily moves under $2.9 and near $3.1 over the past week and a half, most recent settles have been right around the $2.95-$2.98 range, with prices proving unable to sustain any move outside this range.
Cold Arrives In Force And Sends Gas Soaring --After what was a relatively slow week for natural gas prices, the February gas contract finally shot higher as all model guidance increased the intensity of cold in the final third of January. The contract logged an over 4% gain into the settle and continued higher sitting now up more than 6% on the day. It was actually the March contract that eked out the largest gain on the day, with the February contract taking the lead post-settle but the entire strip rallying. This is exactly the rally we had been warning clients about all week was possible once weather cooperated, as we outlined that we expected bullish weather trends this week and held a "Slightly Bullish" weekly natural gas sentiment. In our Afternoon Update yesterday we highlighted that our Slightly Bullish sentiment would continue into the day as we expect the dip yesterday afternoon under $3 would be brief, and in our discussion we said that "...with supportive model guidance $3.1 is in play tomorrow and/or early next week..." Finally, this morning in our Morning Update we reiterated that both $3.1 and $3.25 were in play into early next week, and we expected a rally today on overnight GWDD forecasts that held yesterday's colder trends. We also outlined that 12z models and Week 3 forecasts were likely to turn more bullish today. All this verified well with American and European model guidance showing very significant Week 2 cold risks this afternoon that shot gas prices through resistance. It started with American guidance, which showed very significant cold Days 12-16 (images courtesy of Tropical Tidbits). The Climate Prediction Center picked up on this too, increasing Week 2 cold risks in their latest forecast this afternoon. Their afternoon update also showed that cold was likely to linger in the East through Weeks 3-4.US Drops Four Oil Rigs This Week – Rigzone --The US oil rig count dropped by four this week, while the country added four gas rigs, keeping the total rig count flat.U.S. drillers cut four oil rigs this week, marking the second consecutive week of declines, according to data compiled by Baker Hughes, a GE Company. However, the U.S. added four gas rigs this week, keeping the total rig count flat at 1,075. Oklahoma lost four rigs this week, while Texas and Louisiana dropped two rigs apiece. New Mexico, Pennsylvania and West Virginia all added two rigs each, while Kansas and Ohio both dropped one rig.As far as basins go, the Marcellus had the most gains this week, adding a total of four rigs. The Haynesville, Permian and Utica each added one rig. The Cana Woodford, the only basin to drop rigs this week, lost two rigs. A recent report by Rystad Energy showed that fracking activity in the U.S. slowed in the second half of 2018 and several operators are predicting more modest approaches to CAPEX in 2019 due to a fall in crude oil prices.
Despite shutdown, Trump administration continues work to begin oil drilling in ANWR - As the partial government shutdown drags on, the Trump administration is making sure some Interior Department employees continue work on one of its biggest, most controversial priorities: opening the Arctic National Wildlife Refuge to oil drilling. Drilling opponents were quick to criticize the move, contrasting it with the overflowing trash cans and unattended public toilets in national parks managed by Interior, which have become a symbol of the continuing stalemate in Washington, D.C. Emails obtained by Alaska’s Energy Desk show that on Jan. 3 — 13 days into the shutdown — Bureau of Land Management project coordinator Nicole Hayes wrote to community leaders in Alaska to schedule public meetings for the ongoing environmental review process needed to allow oil lease sales in the Arctic refuge. When contacted Friday by Alaska’s Energy Desk, Hayes’ email account sent an automatic reply: “Due to the lapse in funding of the federal government budget, I am out of the office. I am not authorized to work during this time, but will respond to your email when I return to the office.” The new Democratic chairman of the House Natural Resources Committee is demanding details on how the Department of the Interior is continuing its push toward oil lease sales in the Arctic National Wildlife Refuge despite the partial government shutdown.Congressman Raul Grijalva of Arizona wrote to acting Interior Secretary David Bernhardtq uestioning whether his department’s work is appropriate during the partial shutdown. Interior is continuing its environmental review for oil lease sales in the Arctic refuge, as well overhauling the management plan to the west of the refuge in the National Petroleum Reserve-Alaska.
Trump Administration Works Overtime to Make Sure Shutdown Doesn’t Stop Oil Drilling - The partial U.S. government shutdown has docked fishing boats in Alaska, delayed public meetings on a proposed wind farm off the Massachusetts coast and blocked pharmaceutical companies from seeking approval for new drugs. But the Trump administration is working overtime to make sure the shutdown doesn’t halt oil drilling too -- in ways critics say may flout federal law. “One of the principles of government is that you serve everybody equally,” but that’s not what’s happening here, said Matt Lee-Ashley, a former deputy chief of staff at the Interior Department. “The oil industry is still getting business as usual and everybody else is getting shut out, so it’s fundamentally not fair and it may be illegal too.” To be sure, some government work on energy projects is at a standstill now. For instance, the shutdown appears to have halted environmental reviews of Dominion Energy Inc.’s $7 billion Atlantic Coast pipeline and TransCanada Corp.’s Keystone XL pipeline. Interior Department permits to conduct seismic surveys to help find oil in the Atlantic Ocean also have been held up by the impasse. But the Interior Department is still issuing permits for oil companies to drill wells on federal land and in the Gulf of Mexico. It is also moving forward on oil development in the Arctic National Wildlife Refuge and other parts of Alaska, going so far as to convene public meetings over whether to allow pipelines and drilling rigs near wetlands that sustain caribou and threatened birds. The department’s Bureau of Land Management, which conducted those meetings Friday and Saturday -- and has two more planned this week -- says it is using fiscal 2018 “oil and gas management appropriations” to keep the work going amid a standoff between Congress and Trump over fiscal 2019 spending. And the bureau asserts that onshore drilling permits are an exempted activity.
Appeals filed in lawsuits targeting Alaska oil lease sales (AP) — Environmental groups have appealed the dismissal of two lawsuits challenging federal lease sales in the National Petroleum Reserve-Alaska. Four groups sued in February, claiming lease sales in 2016 and 2017 were illegal because the Interior Department failed to consider their effects on greenhouse gas emissions and climate change. The lawsuit said extraction and burning of the reserve’s fossil fuel would harm Arctic wildlife in the reserve. U.S. District Court Judge Sharon Gleason dismissed the lawsuit in December on procedural grounds, ruling that the claims should have been brought up earlier at a planning stage. Gleason in December also dismissed the second lawsuit, which claimed that the Bureau of Land Management should have updated its environmental reviews before the 2017 lease sale. Five environment groups have appealed that decision.
BLM: Public meetings tied to drilling in Arctic National Wildlife Refuge have been postponed - A federal agency criticized for working on the Trump administration’s pro-drilling agenda during the partial government shutdown says it has postponed several public meetings it had planned to host before drilling can be allowed in the Arctic National Wildlife Refuge. The dates of the meetings, to be held in several Alaska communities and Washington, D.C., will be announced later, the Bureau of Land Management said in a statement Wednesday. The meetings are part of an environmental review that’s required before drilling can occur in the coastal plain of the 19-million-acre refuge in northeastern Alaska. After decades of bitter fighting over development in the refuge, Congress in late 2017 approved future lease sales that could lead to drilling there. The Alaska meetings had been proposed to take place in Anchorage, Arctic Village, Fairbanks, Kaktovik, Fort Yukon, Venetie and Utqiaġvik. BLM has been criticized by conservation groups and others for conducting work related to the environmental review in the refuge, though its offices have been closed during the shutdown. The agency had not publicly announced when the community meetings would be held, said Lois Epstein, Arctic program director for The Wilderness Society. She said Wednesday’s statement appears to be a response to pressure, including from U.S. Rep. Raul Grijalva, a Democrat from Arizona who chairs the House’s Natural Resources Committee.
US Rig Count Flat As Canadian Drillers Add 100+ Rigs In Winter Season - Baker Hughes reported no change to the number of active oil and gas in the United States this week.The total number of active oil and gas drilling rigs is holding steady at 1,075 according to the report, with the number of active oil rigs decreasing by 4 to reach 873 and the number of gas rigs increasing by 4 to reach 202.The oil and gas rig count is now 136 up from this time last year, 121 of which is in oil rigs.WTI prices were down on Friday despite newfound hopes that trade talks between China and the United States will prove fruitful soon. At 12:25pm EDT, the WTI benchmark was trading down $0.75 (-1.43%) at $51.94—up week on week, with Brent crude trading down $0.87 (-1.41%) at $60.81 per barrel—also up week on week. Today’s price decline marks the end to a more than week-long uptrend for prices that reached a five-week high, after a particularly volatile 2018, even by oil industry’s standards.Canada’s oil and gas rigs increased by 108 rigs this week—a rather abrupt halt to the 4-week losing streak that saw the energy-rich but infrastructure-poor country lose about 100 rigs over the last four weeks as drillers are gearing up for winter season. Canada’s total oil and gas rig count is now 184, which is 92 fewer rigs than this time last year, with a 83-rig increase for oil rigs, and a 25-rig increase for gas rigs for the week. Canada’s falling rig count is likely due in part to a new mandate that called for the country to collectively shave 300,000 bpd off its crude oil production figures.The EIA’s estimates for US production for the week ending January 4 has the United States holding fast at an average rate of 11.7 million bpd for the week. By 1:07pm EDT, WTI had decreased by 1.73% (-$0.91) at $51.68 on the day. Brent crude was trading down 1.75% (-$1.08) at $60.60 per barrel.
14 Indigenous Activists Arrested in Canadian Pipeline Standoff - A standoff between indigenous activists and TransCanada over a proposed natural gas pipeline in British Columbia (BC) came to a head Monday as Royal Canadian Mounted Police (RCMP) stormed a checkpoint set up by protesters to block construction, arresting 14, The Aboriginal Peoples Television Network (APTN) National News reported Tuesday.The RCMP were enforcing a court injunction issued Dec. 14, 2018 saying that Coastal GasLink, a subsidiary of TransCanada, could access unceded Wetsuwet'en territory in order to build a pipeline. The company says it has approval from the elected representatives of all 20 First Nation groups along the pipeline route, but the hereditary Wetsuwet'en leaders say that they are the ones who control access to the land, and they do not want any fossil fuel development to take place on it. "The RCMP's ultimatum, to allow TransCanada access to unceded Wet'suwet'en territory or face police invasion, is an act of war. Canada is now attempting to do what it has always done—criminalize and use violence against indigenous people so that their unceded homelands can be exploited for profit," the main protest camp said in a statement reported by The Guardian.The main camp, the Unist'ot'en camp, was established almost ten years ago on the Morice River to prevent three different pipeline projects from passing through the area, APTN reported. A separate Gidimt'en checkpoint, which the police rushed on Monday, was set up within days of the court injunction, according to The Guardian. The Unist'ot'en and Gitimd'en are two of the five clans that make up the Wet'suwet'en. The Gitimd'en checkpoint was toppled Monday, and it is not known when police will move on the Unist'ot'en camp, APTN said.
Alberta Seeks Oil Glut Solution - What’s worse: Too much oil, or too much gasoline? The government of Alberta, weighing the potential of a new refinery for the province, may be on its way to finding out. In 2018, surging crude production in the Canadian province ran into limited space on export pipelines, creating bottlenecks and sending the price of local oil to record lows relative to world benchmarks. Now Premier Rachel Notley’s government wants to see if keeping more of the oil at home with a new refinery will make a difference. On Dec. 11, the government reported it was surveying private companies about building a new refinery. The goal: Free up space for crude on local pipelines by turning more of it into higher-value fuels such as gasoline and diesel. Analysts, though, say existing refineries in the province already produce more refined fuel than is needed. “Its not a lot different than the issue they have with crude,” Jason Parent, vice president of consulting at Kent Group Ltd, a downstream consultancy based in London, Ontario. “You still have to ship that product to market.” The province will accept submissions for refinery proposals until Feb. 8 and will consider greenfield projects and expansions at existing sites. At this point, the government is only seeking a sense of the projects companies may be considering and isn’t yet ready to say how it would support those plans. Heavy Western Canadian Select, the type of crude produced in Alberta, fell to a $50 a barrel discount to West Texas Intermediate, the U.S. benchmark. The situation became so acute that Alberta’s government announced a mandatory, province-wide 8.7 percent production cut to keep prices from falling further. New oil export pipeline projects -- including TransCanada Corp.’s Keystone XL, and the expansion of the Trans Mountain pipeline to the Vancouver area -- have faced environmental opposition and court-imposed delays. Even Enbridge Inc.’s Line 3 expansion, approved and scheduled to start operation in the second half of this year, is facing legal challenges from opponents. While building more refining capacity in the province would reduce the glut of crude oil, the province’s five existing refineries already produce more refined fuels -- including gasoline, diesel and jet fuel -- than is needed. And, as with crude oil, pipeline links for refined products to markets outside Alberta are limited. The 300,000 barrel-a-day Trans Mountain line transported 42,000 barrels a day of fuels to the Vancouver area for use by drivers in British Columbia. Enbridge’s Line 1 moves gasoline and diesel from Edmonton, Alberta, to third parties in Gretna, Manitoba, but none to the U.S.
Canadian Crude Surges-- Canadian heavy oil’s discount to U.S. crude -- which shrank to the smallest in more than a year on Monday -- may widen again in 2019 as the reality sets in that Alberta’s oil-transportation woes are far from solved. While Western Canadian Select prices have surged since mid November, helped by a provincial plan to curtail 325,000 barrels of daily output, trading has been thin and doesn’t reflect the fundamentals of the physical market, said Andrew Botterill, a partner in Deloitte’s resource evaluation & advisory group in Calgary. Those fundamentals include pipeline bottlenecks and 35 million barrels of oil in storage, he said. WCS may retreat to $38 in 2019, while U.S. benchmark West Texas Intermediate may rise to $58 a barrel this year, implying a $20 differential, Botterill said in a note published Tuesday. That would be more than twice the $9.75 the discount notched on Monday. “We are still in an oversupply, and we do have a lot of volumes that are currently sitting in storage, and Canada as a whole has to get through that,” Botterill said in an interview. “So that does mean that there’s going to be some discounting, and it’s going to be a really tough first half of the year.” In the second half, Canadian prices may benefit from a ramp-up in rail capacity, which should add 120,000 barrels of daily offtake by 2020, he said. Enbridge Inc.’s Line 3 expansion should be online in the second half of the year, adding 370,000 barrels of new capacity, he said. Helping take the edge off of the turbulence may be increased demand from U.S. Gulf Coast refineries, which are looking to replace shrinking supplies from Mexico and Venezuela
Newly Elected President of Mexico to Ban Fracking – Mexico's president-elect Andrés Manuel López Obrador said he will end the use of hydraulic fracturing, orfracking, once he enters office on Dec. 1."We will no longer use that method to extract petroleum," the populist politician said Tuesday at a press conference, as quoted by the Associated Press.This is a setback for the energy industry that has eyed Mexico's shale-rich Burgos Basin in the north,DeSmog reported. It was only less than a year ago when Mexico's national energy ministry opened the onshore portion of the Burgos Basin for natural gas exploration and development by private companies.The horizontal drilling technique is used to unlock oil and natural gas deposits from shale beds. Fracking has significantly ramped up natural gas extraction and has aided local economies, but opponents say that fracking pollutes the air and groundwater, among other environmental and public health concerns. The technique has been banned in many U.S. municipalities and countries around the world.The "plan to ban fracking in Mexico represents the latest common-sense decision by a world leader to prohibit this inherently toxic, polluting practice," Food & Water Watch executive director Wenonah Hauter told DeSmog."President-elect Obrador is moving in the right direction on many issues, including energy and the environment," Hauter added. "He can move even farther by pledging to transition Mexico to a fully clean, renewable energy future, thereby setting a remarkable example for its neighbors to the north." According to the AP, Lopez Obrador also spoke against private electricity generation contracts that have displaced the state-owned Federal Electricity Commission, or CFE."The neoliberal governments deliberately closed the CFE plants in order to buy electricity from foreign companies at very high prices," Lopez Obrador said. "All of that will be corrected."
Mexico Fuel Theft Crackdown Sparks Shortages, Puts Govt. on Defensive - — Mexican President Andres Manuel Lopez Obrador said on Monday that his crackdown against fuel theft was yielding positive results, even as the intervention sparked severe fuel shortages in parts of the country and long lines of angry motorists. In a bid to eliminate years of mounting theft, state oil firm Pemex has changed its distribution, triggering shortfalls in at least six states, including Guanajuato, a major car-making hub in central Mexico. Guanajuato's state government said that less than one third of the state's gas stations were open on Monday. Lopez Obrador told a news conference the government had not established a date for when operations would return to normal, but stressed that supply was not in danger. "We are changing the whole distribution system, that's the reason for the shortage. We have enough gasoline," he said. Mexican television showed long lines of drivers waiting to fill up in central states as well as Jalisco in the west and Tamaulipas in the north. Years of fuel theft by criminal groups and others by tapping pipelines and stealing tanker trucks has led to losses totaling billions of dollars for public coffers. Lopez Obrador's government has ordered the armed forces to intervene in Pemex's facilities, including one refinery. "The supply will normalize, and at the same time we are going to guarantee that fuel is not stolen," said Lopez Obrador, who took office in December. "We have seen a reduction in theft like never before ... but we still have work to do."
Valero Milford Haven oil spill: Seabed to be assessed -- The scale of pollution caused by an oil spill on the Welsh coast is still being evaluated in order to protect "sensitive seabed habitats". Between 7,000 to 10,000 litres of oil leaked from a fuel line into the Milford Haven estuary on 3 January. While the loss of oil was limited and very little oil reached land, booms will remain in place to protect salt marshes and habitats in the estuary. The Welsh Government said the slick was no longer visible. The Valero jetty, where the spill took place, is on the south side of the Milford Haven estuary Natural Resources Wales has also issued an enforcement notice to Valero, which operates the refinery in Pembrokeshire, to stop the use of the two fuel pipelines on the jetty. A statement by Environment Secretary Leslie Griffiths said surveys were under way and the clean-up would continue as required.
Local councils heading for fracking showdown with government - Ministers are facing a fresh confrontation with local councils over their controversial plans to expand fracking, after one of the biggest combined authorities in the country set out plans to ban the practice.Greater Manchester’s decision to effectively stop companies from extracting underground shale gas in the region was greeted as a critical moment in the fight against fracking, which critics say is dangerous and unproven.The 10 local authorities that make up Greater Manchester will put planning measures in place to create a “presumption” against fracking for shale gas, said the area’s mayor, Andy Burnham, as part of its effort to become carbon neutral by 2038.The announcement, which comes as London finalises a similar scheme, will amplify discontent among local councils – including Tory-controlled authorities – that experts said could lead to a showdown with central government, and potentially kill off ministers’ plans.Concerns about the drilling technique were again raised in the run-up to Christmas when the energy company Cuadrilla was forced to pause operations near Blackpool three times after drilling caused small earthquakes that breached legal limits. Several other authorities – including Leeds, Wakefield, Hull and York – have expressed opposition to fracking, and experts believe the stance taken by Manchester and London will embolden others. Many Conservatives are also opposed. In Westminster, almost two dozen Tory MPs are reported to be against fracking and willing to “destroy the government’s majority” if it tries to weaken planning laws. Several Tory-run local authorities – including Derby, Dorset and Nottinghamshire – are fiercely opposed to the change in planning proposals, which would mean companies could drill test sites without applying for planning permission.
Nord Stream 2 Is Losing Support In Germany - The Nord Stream 2 pipeline is running into some trouble amid opposition from the Trump administration. Support for the Nord Stream 2 pipeline in Germany is slipping, according to a report from Bloomberg. Some politicians in Chancellor Angela Merkel’s coalition are moving against the pipeline for geopolitical reasons, citing fears that the project would allow Russia a freer hand in Ukraine.As it stands, Russia still needs to ship large volumes of gas to Europe via Ukraine. Nord Stream 2 would allow Russian gas to bypass Ukraine, giving Russia more leverage to meddle in Ukraine while still reliably delivering gas to Europe.Merkel has been supportive of the project, not least because several major western European companies have stakes in the pipeline, including Royal Dutch Shell, as well as major German companies Wintershall and BASF. Last year, Merkel, under intense pressure from the Trump administration and some countries in Eastern Europe, acknowledged that the Nord Stream 2 had geopolitical ramifications and suggested that the project could face roadblocks if the end result was harm to Ukraine. Still, she seemed to want to push the project forward.However, those efforts are starting to run into trouble. The recent seizure of Ukrainian sailors by Russia is starting to increase unrest within Merkel’s coalition, Bloomberg reports. A growing block of German politicians view the project is a geopolitical liability. The timing is not great for Nord Stream 2. The Trump administration has aggressively opposed the project for quite some time. “There is not only Russian gas coming through the pipeline, but also Russian influence,” Richard Grenell, the U.S. ambassador to Germany, said in a statement to Bloomberg News. “Now is not the time to reward Moscow.”
Russia produces record volumes of oil, gas in 2018 - (Xinhua) -- Russia produced record volumes of oil and gas in 2018, Energy Minister Alexander Novak said Thursday. He told Russian President Vladimir Putin at a meeting that last year Russia's crude oil output rose by 1.6 percent, or 10 million tons from 2017 to 556 million tons, according to a Kremlin transcript of minutes of the meeting. The increase was attributed to the operation of 54 new oil fields, including several major ones in the Krasnoyarsk region and the Yamalo-Nenets region. Last year's natural gas output hit a record in 18 years with 725 billion cubic meters, up about 5 percent from 2017, Novak said. Russia's gas exports rose by 20 billion cubic meters to nearly 225 billion cubic meters last year, with pipeline deliveries up 4.1 percent, and liquefied natural gas (LNG) exports up 70 percent to nearly 26 bilion cubic meters after new facilities of the Yamal LNG plant were put into operation, he said. The energy sector accounted for 25 percent of Russia's gross domestic product and nearly 45 percent of federal budget revenues, according to Novak.
Europe is fast-becoming a natural gas battleground for Russia and the US -- With 28 countries and a combined population of around 512 million people, the European Union is something of a prized market — and political battleground — for the world's largest energy exporters, particularly when it comes to natural gas. Russia has long been the dominant source and supplier of natural gas to Europe's mass market but the U.S. is looking to challenge Russia by stepping up its imports of U.S. liquefied natural gas (LNG) — gas which is super-cooled to liquid form — making it easier and safer to store and transport.Europe certainly appears keen to wean itself off Russian gas, and all the geopolitical implications that reliance entails, while making overtures to the U.S. Last July, European Commission President Jean-Claude Juncker and President Donald Trump agreed to strengthen U.S.-EU strategic cooperation with respect to energy and the EU said it would import more LNG from the U.S. "to diversify and render its energy supply more secure."Twenty-four percent of U.S. LNG went to the EU in October 2018, a month which saw the largest volume ever of EU-U.S. trade in LNG of almost 0.6 billion cubic meters. In the whole of 2017, only 10 percent of U.S. LNG exports went to the EU. The Commission, the EU's executive arm, expects U.S. gas exports to the region could double by 2022 and has vaunted the construction of LNG terminals across Europe. "The fact is that U.S. LNG, if priced competitively, can play and increasing role in EU gas supply, enhancing diversification and EU energy security," the EU said in a document detailing the state of EU-U.S. LNG trade in late November. The U.S. became a net natural gas exporter in 2017 for the first time in almost 60 years, according to the country's Energy Information Administration (EIA). It saw exports of its LNG rise 58 percent through the first half of 2018, compared with the same period in 2017. In fact, while U.S. LNG exports have continued to grow in 2018, U.S. natural gas pipeline import and export volumes have either remained relatively flat or declined from 2017 levels, the EIA noted. U.S. exporters looking to Europe have a big obstacle in the region, however, and that's Russia. Russia remains the largest supplier of natural gas to the EU in 2018, according to the Commission's latest data on EU imports of energy products in October. The other main suppliers are Norway and, at a lower level, Algeria and Qatar. Showing the extent of much of the EU's reliance on Russian gas, the Commission noted that 11 member states (Bulgaria, Czech Republic, Estonia, Latvia, Hungary, Austria, Poland, Romania, Slovenia, Slovakia and Finland) imported more than 75 percent of total national imports of natural gas from Russia in 2018, largely due to their proximity to the country.
Norway cuts oil output forecast for 2019 to 30-year low (Reuters) - Norway’s oil output in 2019 will be smaller than previously forecast and its lowest level in three decades, although it should rebound in the following years, the country’s oil industry regulator said on Thursday. Investment in Western Europe’s largest oil producer and Europe’s second-largest gas producer, behind Russia, is surging after a decline due to the slump in oil prices in 2014 to 2016. Despite that, oil output in 2018 of 86.2 million cubic meters (mcm), or 542 million barrels, missed a 90.2 mcm forecast made a year ago, the Norwegian Petroleum Directorate (NPD) said. NPD head Bente Nyland told Reuters that production last year and this year’s prediction were lower than previously expected due to start-up delays and production difficulties at several fields. The regulator said output in 2019 was expected to be 82.2 mcm, against a previous forecast of 87.2 mcm, but will rise to over 100 million cubic meters next year after Equinor starts its giant North Sea Johan Sverdrup field. Germany’s Wintershall said in October its Maria field in Norway was not meeting output expectations due to water injection issues. “The problems have not been solved yet,” Nyland said. Norway’s gas production last year stood at 119.3 billion cubic meters (bcm), also missing a 121.2 bcm forecast. In 2019 it is expected to rise slightly to 119.5 bcm but still below a previous forecast of 121.4 bcm and below the record 122 bcm produced in 2017. Norway’s combined oil and gas production is expected to come close to its 2004 record level by 2023, when production peaks at Sverdrup, which is expected to account for about 40 percent of Norwegian oil output after 2022.
Italy To Block Oil & Gas Exploration Permits - Italy plans to suspend the issuing of 36 pending oil and gas exploration permits, as the government finds upstream oil and gas activity not of strategic importance to the country.At the same time, the ruling populist coalition government, in power since June 2018, is looking to significantly boost the share of renewable energy in Italy’s power mix and total energy consumption, including in the transportation sector.The current government strongly supports Italy’s push to have as much renewable energy in its energy consumption as possible. The previous government also backed the rise of renewables and drafted a strategy to phase out coal-fired electricity by 2025. The new government is keeping the targets of the previous cabinet and has even increased some of the clean energy targets for Italy’s energy consumption and generation, in a bid to cut more carbon emissions in the country.The government has drafted an amendment to legislation proposing to block the issuing of oil and gas drilling permits, Italy’s Industry Ministry said in a statement on Wednesday, noting that the proposal would be discussed in the next few days at the relevant committees in Parliament.The proposed legislation would halt the issue of a total of 36 drilling permits, including three permits that have already been issued for drilling in the Ionian Sea, Industry Undersecretary responsible for energy, Davide Crippa, said. Italy—Europe’s fourth-largest energy consumer—is heavily dependent on imports to meet about 93 percent of its oil and natural gas needs.
Winners and Losers of Offshore Spending Revival - -- After four years of cutbacks, oil companies are poised to open their purses again and develop new offshore fields, although the benefits won’t be spread equally across the companies who provide them everything from seismic surveys to pumps and turbines.The long-awaited spending rebound will re-energize oil-services providers that have survived the deepest crisis in a generation thanks to cost cuts, mergers and sometimes painful debt restructuring. But for some debt-laden suppliers, the investment pickup may come too late.Notwithstanding recent oil-price volatility, spending on offshore oilfield services will rise by 6 percent in 2019 reaching $208 billion, before surging by another 14 percent in 2020, according to Norwegian consultancy Rystad Energy AS. That’s after almost halving since 2014.Oil producers will probably commit to 110 new undersea projects this year, up from 96 in 2018 and just 43 in 2016 -- when the industry slashed capex as oil slumped.The market for subsea equipment may expand by between 13 percent and 14 percent each year through 2023, said Audun Martinsen, head of oilfield service research at Rystad, in an interview. This is in part as suppliers resume to hike prices.Oilfield surveyors and providers of support and maintenance services should rebound at a slower pace as an overcapacity of vessels continues to glut the market and the rigs sector, the worst performing segment in offshore last year, should improve at last, Martinsen said.London-based oilfield services provider TechnipFMC Plc forecast that 2019 revenue at its subsea division will climb but margins may fall. This year the company is anticipating “continued strong activity” for investment decisions in small-to-mid-size projects, and “an increasing number of the larger greenfield subsea projects,” Chief Executive Officer Doug Pferdehirt said in December. “A lot of these offshore projects are located at deep waters,” benefiting subsea gear makers such as TechnipFMC and Subsea 7 SA, Rystad’s Martinsen said.
Oil spill from Espadarte field FPSO - Brazilian state-run oil firm Petróleo Brasileiro S.A. announced there was an oil spill on January 2 from its chartered floating production storage and offloading unit (FPSO) Cidade de Rio de Janeiro, in the Espadarte field offshore Brazil. Petrobras said approximately 4.9 cubic meters of oil leaked from one of the tanks of the FPSO, which is in the process of being decommissioned after ceasing production in July 2018. The spill was contained on January 3. The FPSO Cidade de Rio de Janeiro is operated by Modec do Brasil in the Espadarte field in the Campos Basin, approximately 130 kilometers from the Macaé coastline, on the north coast of Rio de Janeiro. It achieved first oil in January 2007. Petrobras said regulatory agencies have been informed, and a commission of inquiry will investigate the causes of the incident in cooperation with Modec.
$123B of Offshore Projects May be Sanctioned in 2019 - $123 billion of offshore projects could be sanctioned in 2019 if Brent rebounds to $60 per barrel and further cost reduction efforts are successful on current non-economic projects up for sanctioning. That’s according to Rystad Energy, an independent energy research and business intelligence company, which told Rigzone on Friday that its current Brent forecast for this year is $65 per barrel. “With a rebound to $60 per barrel Brent, 2019’s offshore project sanctioning has the potential to reach its highest level of activity since 2013,” Rystad said in a statement posted recently on its website. “The Middle East will have the most shallow water projects up for commitment decisions during the year. Moving into deeper waters, South America will surely take the global stage. The continent looks to review the largest deepwater plays during 2019,” Rystad added. Fifteen percent of the potential $123 billion to be committed in 2019 have breakeven prices over $60 per barrel, according to Rystad, which revealed that of those, the vast majority are for new fixed and floating facilities. “For 2019 to reach its full offshore sanctioning potential, further cost reduction efforts on these projects are needed,” Rystad stated. In a statement sent to Rigzone on December 18, Rystad said the outlook for offshore oilfield service contractors is strong. In the statement, Rystad revealed that more than 100 new offshore projects are aiming for 2019 sanctions and that an expected $210 billion will be spent on offshore oilfield services globally next year. Oil and gas operators gave the green light to 90-plus offshore projects in 2018, 62 in 2017 and 43 in 2016, Rystad highlighted in the statement.
President Bongo Safe After Military Coup Fails In Oil-Rich Gabon -- Soldiers in Gabon briefly took over a state radio in a failed coup attempt on Monday, but the government said four of the plotters had been arrested and that "normalcy would be restored" in the oil-rich Central African nation. A fifth suspect was on the run after soldiers announced plans for a “national council of restoration,” in the oil-rich country, where the ruling Bongo family has been dogged by accusations of corruption and fraud during nearly a half-century in power, the NYT noted. “The army has decided to put itself on the side of the people in order to save Gabon from chaos,” soldiers said after they took over a Gabon radio station.On Monday, government soldiers swarmed the streets of the capital, Libreville, guarding the national radio and TV stations, and military tanks and armed vehicles were visible. Taking a page out of every populist playbook, the military officers announced plans to "save a democracy in danger."However, a few hours later, democracy appeared to be in danger again as thing were returning to normal: "The government is in place,” a government spokesman, Guy-Bertrand Mapangou, told France 24. “The institutions are in place."Meanwhile, the target of the coup, President Ali Bongo Ondimba, has been out of Gabon since October while receiving medical treatment for what many believe was a stroke he suffered while attending a conference in Saudi Arabia according to the NYT. He had sought to reassure the nation he was fit during a New Year’s Eve speech televised from Morocco, where he is recuperating. Lt. Kelly Ondo Obiang, the leader of the self-declared - and very short-lived - Patriotic Movement of the Defense and Security Forces of Gabon, said on state radio that the speech “reinforced doubts about the president’s ability to continue to carry out of the responsibilities of his office,” Reuters reported.
Indian refiners pay for Iranian oil in rupees - UCO Bank executive (Reuters) - India has begun paying Iran for oil in rupees, a senior bank official said on Tuesday, the first such payments since the United States imposed new sanctions against Tehran in November. Washington gave a six-month waiver to eight countries, including India, allowing them to import some Iranian oil. India, the world’s third biggest oil importer, wants to continue buying oil from Iran as it offers free shipping and an extended credit period, while Iran will use the rupee funds to mostly pay for imports from India. “Today we received a good amount from some oil companies,” Charan Singh, executive director at state-owned UCO Bank told Reuters. He did not disclose the names of refiners or how much had been deposited. New Delhi recently issued a notification exempting payments to the National Iranian Oil Co (NIOC) for crude oil imports from steep withholding taxes, enabling refiners to clear an estimated $1.5 billion in dues. An industry source said India’s top refiner Indian Oil Corp and Mangalore Refinery & Petrochemicals have made payments for Iranian oil imports. Neither was immediately available for comment. Iran is devising payment mechanisms including barter with trading partners like India, China and Russia following a delay in the setting up of a European Union-led special purpose vehicle to facilitate trade with Tehran, its foreign minister Javad Zarif said earlier on Tuesday. In the previous round of U.S. sanctions, India settled 45 percent of oil payments in rupees and the remainder in euros but this time it has signed deal with Iran to make all payments in rupees as New Delhi wants to fix its trade balance with Tehran. Indian imports from Iran totalled about $11 billion between April and November, with oil accounting for about 90 percent. Singh said Indian refiners had previously made payments to 15 banks, but they will now be making deposits into the accounts of only 9 Iranian lenders as one had since closed and the U.S has imposed secondary sanctions on five others.
U.S. crude starting to seep back to China, but needs lower price: Russell (Reuters) - U.S. crude oil is starting to trickle back to China with three cargoes slated to arrive next month, but volumes are still a long way off levels prior to the outbreak of trade hostilities between the world’s two largest economies. Vessel-tracking data compiled by Refinitiv shows three tankers carrying 3.94 million barrels are en route from the United States to China and will arrive in February. This is up from zero cargoes slated to arrive in January, a mere one in December and zero in both November and October. Prior to the tit-for-tat tariffs being imposed from the middle of last year, crude oil was a success story in the U.S.-China trade relationship as Beijing bought increasing volumes of booming U.S. shale oil production. In the first nine months of this year, China imported about 328,000 barrels per day (bpd) from the United States, representing about 3.6 percent of its total crude imports. China’s imports of U.S. crude reached a record high of about 460,000 bpd in June, according to the Refinitiv data. It’s worth noting that China hasn’t imposed any tariff on U.S. crude imports, unlike coal and liquefied natural gas, which were included in Beijing’s retaliatory measures. What seems clear is that Chinese refiners decided to hold back on buying U.S. crude either because they were nudged in that direction by the government, or because they were concerned that a tariff would be imposed. Using crude oil for politics is certainly nothing new, so the resumption of trade between China and the United States may well depend on the status of talks between the administration of President Donald Trump and its counterpart in Beijing. However, if the U.S.-China crude trade was strictly about economics, it’s likely that U.S. crude prices will have to fall some more, especially relative to competing grades of West African crude.
China awards 3.14 mil mt oil product export quota under processing trade: sources - China has awarded 3.14 million mt of export quotas for gasoline, gasoil and jet fuel for use under the processing trade route, a week after Beijing awarded 18.36 million mt of oil product quotas under the general trade route, market sources told S&P Global Platts Tuesday. Export quotas for jet fuel accounted for 92% of the allocations under processing trade, which was within expectations. The export quotas under the trade route for jet fuel are normally used for sending barrels to bonded storage for fueling international flights, while those under the general trade route are for exports directly to overseas markets. The latest allocation brings the total oil product export quota allocation in the first round of 2019 to 21.5 million mt, up 7.5% compared with the first round of 2018. Export quotas for middle distillates -- gasoil and jet fuel -- rose 25.2% and 17.4% year on year to 8.9 million mt and 7.35 million mt, respectively. Gasoline was the only product to see a decrease in its export quota allocation for 2019, falling 20.8% year on year to 5.25 million mt. Sinopec saw the largest decline in gasoline quotas, down 46% at 700,000 mt, and the largest increase in gasoil quotas, up 36% year on year at 4.9 million mt. China awards oil product export quotas to state-owned CNPC, Sinopec, CNOOC and Sinochem under the general and processing categories. Under the general trade route, state refiners are free to export from the domestic market, irrespective of whether the feedstock is domestic or imported crude. Unused quotas can be rolled over to the following quarter, but not to the following year. Under the processing trade route, refiners have less flexibility -- the feedstock must be imported crude and the products can only be sold to the party that supplied the crude feedstock, although the products can be resold again.
Oil, LNG trade at stake in US-China talks resuming Monday - Trade talks resuming Monday between the US and China could signal whether crude and LNG flows will pick up between the two countries this year or stay mired in the trade dispute. The US Trade Representative announced Friday that top energy and agriculture officials would be part of the US delegation attending meetings in Beijing Monday and Tuesday. US crude exports to China disappeared in August, with none reported through October, according to the latest US Energy Information Administration data. Before exports dried up, the US sent an average of 377,600 b/d to China in the first seven months of 2018, according to EIA data. The all-time highest monthly average was June's 510,000 b/d. US LNG shipments to China stopped in September, according to EIA data, but returned in October at lower levels than earlier in the year. The US sent 7.3 Bcf to China in October, compared with a 2018 monthly peak of 17.5 Bcf in April and 2017 monthly peak of 24.6 Bcf in October 2017. China hit US LNG with a 10% tariff in September and threatened to increase it to 25% in retaliation to Trump administration tariffs on $200 billion in Chinese goods. Charlie Riedl, executive director of the Center for LNG trade group, said some US LNG exports can continue to China despite the current tariff, but a 25% tariff would all but halt the flows. Kevin Book, managing director of ClearView Energy Partners, does not expect any major breakthroughs in next week's talks. But, he said, a resumption of oil and LNG flows will be one way to gauge whether the negotiations are making progress or breaking down. "If there's to be trade progress with China, the hydrocarbons should be the easy part," Book said. "The reality is that if things go well, China's willing to buy crude oil and LNG from the US because China needs crude oil and LNG. But China's also shown its willingness and ability to diversify itself away from the US in an instant." Next week's talks are the latest between the US and China since US President Donald Trump met with Chinese President Xi Jinping at the G-20 summit in Argentina in December. Trump said at the time that he would delay the next US tariff escalation until March 2, set previously for January 1.
China bans discharge from open-loop scrubbers in coastal waters: official (Reuters) - China’s maritime authority has banned the discharge of “wash water” used in ships to strip hazardous sulfur emissions from engine exhaust gases from Jan. 1, in an effort to curb pollution of its coastal seas. The ban on discharges from so-called open-loop scrubbers affects all rivers and ports along China’s coastline and includes the Bohai Sea, according to an official from the China’s Maritime Safety Administration (MSA). The measure mirrors a similar move made in Singapore ahead of International Maritime Organization (IMO) rules that will ban ships from using marine fuels with a sulfur content of more than 0.5 percent from 2020, unless they are equipped with exhaust “scrubbers” to clean up sulfur emissions. “We adopted the ban in designated regions mainly out of consideration to protect the environment and prevent sulfur content pollution in more acidic waters,” said the official. The ban, however, will not be extended to all of China’s territorial waters because of the increased costs for the shipping industry, said the official. China imposed tighter rules from the start of 2019 on sulfur and nitrogen oxide emissions from vessels in coastal areas, Hainan waters, and inland Yangtze and Xijiang river areas, according to the Ministry of Transport. The wash water ban also took effect on the first day of 2019, MSA said. Ship operators are also not allowed to discharge any residue from wash water or burn it on the ships, it said. “The bans will limit the use of scrubbers, and therefore high-sulphur fuel oil, in China, suggesting a strong uptick in diesel demand,” said research consultancy Energy Aspects in an email alert to clients on Tuesday. To comply with the ban on wash water discharge in designated waters, shippers will have to switch to a closed-loop scrubber system or to low-sulphur bunker fuels such as gasoil, or diesel, and low-sulphur fuel oil. Open-loop scrubbers use seawater to capture sulfur from engine exhausts before discharging this wash water back into the ocean after treatment. In closed-loop systems, scrubbing is performed using water treated with additives, recycling the liquid internally. Hybrid scrubbers are a combination of both.
MAERSK container ship massive oil spill in Hong Kong - Massive oil spill from container ship MAERSK GATESHEAD occurred early in the morning Jan 6 in Hong Kong, at Kwai Tsing Container Terminal, where the ship docked in the afternoon Jan 5. Shortly after, bunker tanker CARLUNG moored alongside container ship, obviously for bunkering. Spill was reported to authorities at 0530 HK time Jan 6, anti pollution operation was launched, and as of evening, was still under way. No doubt spill occurred during bunkering operation, though it is not known yet, who’s to blame and what went wrong. Judging from photo, oil leaked overboard from starboard cargo deck, during night time, probably that’s why it was spotted too late to stop fuel transfer and avoid overboard leak.Update: Confirmed oil spill caused by heavy fuel overflow during bunkering operation, quantity of fuel leaked overboard unknown, cleansing still under way.
One dead, two still missing after explosion rips through oil tanker - A crewman was killed, seven injured and two are still missing after an oil tanker caught fire off the coast of Lamma Island in Hong Kong on Tuesday. Three explosions were reported during the fire, with residents from as far away as Mui Wo and Discovery Bay on Lantau Island saying they heard loud bangs and saw windows shaking. Authorities said the blaze, which began at around 11.30am and was finally put out at 4.30pm, is believed to have started when the Aulac Fortune, a Vietnamese-registered vessel, was in the process of being refuelled by an oil barge. The 144-metre (472-foot) tanker, which has a tonnage of 11,290, was on its way to Thailand after unloading oil cargo in Dongguan, Guangdong province, but stopped off one nautical mile south of Lamma Island for the refuel. There was no oil cargo on the tanker at the time of the fire. Yiu Men-yeung, the Fire Services Department’s division commander for marine and diving, said on Tuesday evening the explosions and fire broke out on the tanker’s deck when the crew were connecting hosepipes to transport fuel from a nearby oil barge. “They hadn’t started the refuel when the crew heard three explosions,” Yiu said, adding that three fuel tanks on the oil barge were also damaged. Though the oil tanker was tilted 30 degrees, Yiu said there was no risk of its sinking or of an oil leak. “If there is a leak, the Marine Department officials stationed on site will make an enclosure immediately,” Yiu said, adding they would study ways to stabilise the vessel to allow investigators to board the ship and look into the cause of the fire. Three helicopters were sent to the scene in search of the missing sailors, while four fire services and more than 10 marine police vessels were also deployed. It took 140 firefighters and medical staff five hours to extinguish the fire, which was upgraded to a No 3 alarm at around 1.30pm.
Oil Tanker Fire Near Hong Kong Kills 1, Potential Spill Could Threaten Endangered Turtles and Dolphins - An oil tanker caught fire off of Hong Kong's Lamma Island Tuesday morning, leaving one person dead and two missing."We could see that the victim who passed away had been burned," police representative Wong Wai-hang said in a briefing reported by The New York Times. "There were clear injuries on his head and fractures in his hands and feet."An additional 23 crew members were rescued from the water. Four were injured and one was being treated in intensive care.The explosions were strong enough to be felt by residents of the nearby island, CNN reported."My windows shook really badly but (there) was no wind," Lamma resident Deb Lindsay told CNN. "I thought there had been an earthquake!" Lamma Island residents worried about a potential oil spill reaching their coastline. Southern Lamma Island hosts a protective nesting site for green turtles, a severely endangered species. An endangered colony of white dolphins also calls Hong Kong waters home. Hong Kong's Environmental Protection Department told CNN that cleaning vessels had been immediately placed on standby but that no oil spill had yet been detected. Some liquid was seen spilling from the boat, but it was unclear if it was oil or water from firefighting, and there was no oil residue on the water around the vessel.The boat had been refueling in Hong Kong on its way to Thailand from the southern Chinese city of Dongguan, The New York Times reported.The Fire Services Department's division commander of marine and diving Yiu Men-yeung told The South China Morning Post that the boat was tilted 30 degrees as of Tuesday evening but was at no risk of sinking. However, officials said the boat was too hot to tow away immediately, or to board to discover the cause of the fire, and would need several days to cool down.
Kuwait to use solar power to extract fossil fuels - The Zawya.com Middle East news website yesterday carried a report that said the state-owned Kuwait Oil Company was finalizing consultation on a plan to use solar power to aid oil production at the “giant” Ritqa oilfield. According to the report, and without any hint of irony, the oil company is ready to turn to solar to keep down the energy costs of expanding oil extraction, as part of the state’s plan to ramp up its production of the fossil fuel. During an experimental first phase, solar power would provide “most of the power required in a sustainable manner” as the oil company aims to extract 60,000 barrels per day of high viscosity oil from the field by the end of the year.
Saudis Slash Oil Output. Get Ready for Trump Tweets - The list of things that President Donald Trump criticizes in his tweets varies from one day to the next. He may soon have to direct his ire to oil prices and the actions of his ally, Saudi Arabia, once again. The desert kingdom is already making good on its promise to slash supply, and the initial evidence suggests that the biggest cut is being made in deliveries to the U.S. On top of that, the price it charges American buyers of its crude has been raised to near record levels for cargoes to be shipped in February. That could be bad news for a president who just celebrated falling gas prices. The OPEC+ group of countries met in December and, after Russia took the reins, eventually agreed to cut supplies by 1.2 million barrels a day from January. For Saudi Arabia, that meant cutting production to just over 10.3 million, but it pledged to go further — oil minister Khalid Al-Falih told reporters and analysts that it would be slashed to 10.2 million barrels a day in January. The first job was to unwind the output surge made in November that had helped to deliver the price drop hailed by Trump. That was done last month. Saudi production in December was back below the October baseline used for its (and most other countries’) promised cuts. Saudi crude production was cut to 10.65 million barrels a day in December from a record 11.07 million in November That couldn’t have been what Trump wanted, given what he tweeted the day before OPEC began its meeting in Vienna — at the time, crude prices were in the midst of their worst quarterly decline in four years. Bloomberg’s tracking of crude exports from Saudi Arabia indicates that the biggest drop in flows from the kingdom was in the volume heading for the U.S. Shipments to ports on the Atlantic, Gulf and West coasts fell by nearly 60 percent between November and December to just over 350,000 barrels a day. That’s the lowest since Bloomberg started tracking these flows in January 2017.
Trump Credits Own 'Talent' for Oil Prices - -- President Donald Trump said OPEC “is essentially a monopoly,” even as he credited his own “talent” for having brought down oil prices. “Four months ago, oil hit $83 a barrel," Trump told reporters in the Rose Garden after meeting with Congressional leaders to try and reach a deal on the partial government shutdown. Oil “was heading to $100 and then it could have gone to $125.” Trump repeated his statement from earlier this week that his efforts made the difference in bringing down the oil price. “After I made some phone calls to OPEC and the OPEC nations -- which is essentially a monopoly -- all of a sudden, it started coming down,” he said. "Didn’t happen by luck, it happened through talent.” Trump has previously tweeted that OPEC is a monopoly, including as recently as July and September. Legislation, formally called the "No Oil Producing and Exporting Cartels Act" but known as NOPEC, has been repeatedly introduced in both houses of Congress in recent years that would allow the U.S. Justice Department to file suit against the Organization of Petroleum Exporting Countries. U.S. Assistant Attorney General Makan Delrahim told members of a House Judiciary subcommittee last month that the administration “continues to study” the legislation, which would amend the 129-year-old Sherman Antitrust Act. OPEC is consulting with lawyers to prepare a strategy to defend against the legislation, people familiar with the matter said in July. Recent claims by Trump that he’s pressured OPEC into allowing oil prices to fall reflects an overlooked shift in White House policy, according to Bob McNally, former energy adviser to President George W. Bush and president of consulting firm Rapidan Energy Group. “Whereas until early November President Trump was mainly interested in preventing oil price spikes, afterward his goal shifted to delivering a meaningfully lower oil price,” McNally said in an email.
Hedge funds dump crude and diesel as economic outlook darkens - (Reuters) - Hedge funds are cautious on the outlook for oil prices, despite a slump at the end of last year, as fears about the global economy outweigh output cuts by OPEC and its allies. Fund managers cut bullish positions in Brent crude futures and options by 10 million barrels in the week to Dec. 31, exchange data published on Friday showed. Funds have cut their net long position in Brent to just 152 million barrels, down from almost 500 million at the end of September, and close to the lowest level since 2015. Portfolio managers' bullish long positions outnumbered bearish short ones by a margin of just 2.5 to 1, down from a ratio of more than 19 to 1 at the end of September (https://tmsnrt.rs/2SFtSlv ). There are some signs the heavy liquidation of bullish positions between the start of October and early December has run its course, with Brent prices seeming to find a floor above $50 per barrel. But most fund managers have preferred to wait before taking new long positions until the outlook for the global economy and equity prices becomes clearer. Portfolio managers were even more bearish towards middle distillates such as diesel, jet fuel and heating oil, cutting their net long position in European gasoil by 9 million barrels. Net length in ICE gasoil was cut to just 2 million barrels, down from a recent high of 112 million barrels in early October. The ratio of long to short positions was cut to just 1:1, down from a peak of more than 30:1 less than three months ago, and the lowest for more than two years. Middle distillate consumption is heavily geared to freight transportation by ship, road, rail and aircraft, as well as manufacturing, mining and the farm sector. Distillates tend to be in short supply towards the end of the economic and oil price cycles as industrial activity heads towards a peak, helping put upward pressure on crude prices. Until recently, fears of cyclical shortages were exacerbated by the scheduled introduction of new regulations on shipping fuels, which are likely to boost distillate consumption from the start of 2020. But the loss of momentum in global trade growth since the middle of 2018, coupled with fears about a further slowdown or even recession in 2019, has transformed investor sentiment.
Diesel futures point to economic slowdown in 2019- Kemp (Reuters) - By the end of last year, hedge fund positions in diesel had fallen to a level normally associated with a sharp slowdown in economic growth if not an outright recession. Most middle distillate fuels such as diesel, gasoil and jet fuel are consumed in freight transport (ships, trucks, railroads and air cargo) as well as manufacturing and mining. Middle distillate consumption and prices are therefore more closely tied to the state of the economy than other refined fuels such as gasoline. (https://tmsnrt.rs/2HjMiXV ) For the last 25 years, hedge funds and other speculators, collectively termed "non-commercial traders", have mostly held a net long or bullish position in distillate futures and options. The typical net long position reflects the overall expansion of the U.S. and global economies (expansions have been long while recessions have been relatively short). In most cases, when non-commercial traders have switched to a substantial net short or bearish position the economy has been experiencing a sharp slowdown or is already in recession. Large net short positions in 1995, 1998, 2002, 2010 and 2015 were all associated with slowdowns or recessions according to contemporary statements or minutes from the U.S. Federal Reserve's Open Market Committee. The exception was the net short position at the end of 2004, which came six months after the Fed noted a "soft patch" in the expansion, by which time the economy was improving enough for the Fed to raise interest rates again. Crucially, not all these episodes ended in a recession; some were transient slowdowns in an uninterrupted expansion. But given this history, the large liquidation of speculative long positions in diesel futures during the fourth quarter of 2018 was consistent with a substantial deterioration in the economic outlook.
Goldman Sachs slashes 2019 oil price forecast amid oversupply concerns - Goldman Sachs downgraded its oil price forecasts for 2019, citing a surge in global production and surprisingly resilient U.S. shale growth. The investment bank now expects international benchmark Brent crude to average $62.50 a barrel this year, down from a previous forecast of $70. Meanwhile, U.S. West Texas Intermediate (WTI) is expected to average $55.50 in 2019, down from a prior estimate of $64.50, the investment bank said in a research note published Sunday. "We expect that the oil market will balance at a lower marginal cost in 2019 given: higher inventory levels to start the year, the persistent beat in 2018 shale production growth amidst little observed cost inflation, weaker than previously expected demand growth expectations (even at our above consensus forecasts) and increased low-cost production capacity," analysts including Damien Courvalin and Jeffrey Currie said. On Monday, oil prices continued to move away from December's 18-month lows, with OPEC and non-OPEC production cuts providing some support. Last month, OPEC agreed to take 800,000 barrels per day (bpd) off the market from the start of 2019. Pledges from 10 other producers aligned to the influential oil cartel, including Russia, brought total output cuts to 1.2 million bpd. The aim of the energy alliance's production cut is to rein in global oversupply, fueled mostly by the U.S., where production reportedly grew by almost 20 percent to nearly 12 million bpd by the end of 2018. That would make the U.S. the world's biggest oil producer — ahead of OPEC kingpin Saudi Arabia and non-OPEC heavyweight Russia.
Oil market must solve short-cycle riddle in 2019 -- Oil producers are invariably in it for the long haul. Investing billions of dollars to find and develop new resources entails an almost clairvoyant understanding of future demand cycles. However, volatile prices and uncertainty over global growth may see more short-term thinking in 2019. This change in mindset has already happened in the US, now the world’s largest producer. The Permian shale oil basin is the world’s epicenter for so called short-cycle investment — where capital employed drilling wells can be recouped over a briefer period than in conventional fields. S&P Global Platts Analytics forecasts Permian oil production will more than double over the next two years. Output is expected to average 4.9 million b/d in 2020, climbing to 5.5 million b/d in 2021. These figures compare to 2.5 million b/d last year. According to the International Energy Agency, investment in oil projects globally fell 25% between the end of 2014 and 2016. In 2017, upstream spending flat-lined, with the IEA warning earlier this year investment in conventional projects “may be inadequate to avoid a significant squeezing of the global spare capacity cushion by 2023.” Without the kind of short-cycle production coming on stream in the Permian and elsewhere, the world could be staring down the barrel of a new supply crunch early in the next decade.“I’m confident we’ll say in 2020, even in 2021, short-cycle production is likely to be sufficient to meet demand,” But the success of Permian shale and short-cycle investment also brings problems. Oil production rocketing towards 12 million b/d in the US has encouraged OPEC and its allies led by Russia into cutting production to try and boost prices. Brent crude has retreated 30% since it reached $86/b in October amid growing signs of oversupply, weakening demand and rising inventories. “The rapid growth in shale output will push us into a lower-for-longer price environment,” said Currie. Some oil majors are also waking up to the opportunities of short-cycle investment. BP has beefed up its upstream presence onshore in the US with the $10.5 billion acquisition of BHP Billiton’s shale assets. Meanwhile, ExxonMobil has said it plans to triple its production from the Permian by 2025, a year after it acquired a 275,000 acre plot in New Mexico from the Bass family. Shell, which took a $2.1 billion writedown in 2013 on failed unconventional oilfield bets in the US and Canada, has said it could return in the near future.
Oil prices rise on trade talks and supply cuts, but global economy concerns linger - Oil prices climbed for a fifth session in a row on Monday, rallying from December's 18-month low thanks to OPEC production cuts and more stable equity markets. Crude futures extended earlier gains after Dow Jones reported that top oil exporter Saudi Arabia is planning to slash shipments this month to prop up prices and support its budget. "The market has jumped all over that," said John Kilduff, founding partner at energy hedge fund Again Capital. Kilduff noted that a drop in exports has been expected. The Saudis are "just being aggressive about trying to clean up the situation they fell into from oversupplying the market based on the fear of Iran sanctions," he told CNBC. U.S. West Texas Intermediate crude oil futures rose $1.55, or 3.2 percent, to $49.51 a barrel by 10:47 a.m. ET (1547 GMT). Brent crude futures rose $1.43, or 2.5 percent, to $58.49 a barrel, up from December's slide below $50, which was its lowest level since July 2017. Brent has gained about 12 percent since last Monday in its biggest week-on-week rally in two years. "Momentum is coming back into the market from very depressed price levels," Petromatrix strategist Olivier Jakob said. "We've had five consecutive days of price gains already, so what you have today is a continuation of that." The oil prices are drawing support from an agreed supply cut by OPEC, well as some non-member countries such as Russia and Oman. OPEC oil supply fell in December by 460,000 barrels per day (bpd), to 32.68 million bpd, a Reuters survey found last week, led by cuts from top exporter Saudi Arabia. The aim of the production cut is to rein in a surge in global supply, driven mostly by the United States, where production grew by nearly a fifth to over 11 million bpd in 2018. "If compliance by OPEC and the allied non-OPEC countries is similarly high as in the agreement two years ago, the oil market is likely to be rebalanced during the first half year," Commerzbank said in a note..
Oil prices jump on U.S-China trade hopes, supply cuts - (Reuters) - Oil prices edged higher on Monday, rebounding further from 1-1/2-year lows reached in December, on support from OPEC production cuts and steadying equities markets. Brent crude LCOc1 futures rose 27 cents to settle at $57.33 a barrel, a 0.47 percent gain. U.S. West Texas Intermediate (WTI) crude CLc1 futures rose 56 cents to settle at $48.52 a barrel, a 1.17 percent gain. Oil futures have gained more than 7 percent since last Monday. “Momentum is coming back into the market from very depressed price levels,” Petromatrix strategist Olivier Jakob said. Prices drew support from a Wall Street Journal report saying that Saudi Arabia is planning to cut crude exports to around 7.1 million barrels per day (bpd) by the end of January. OPEC and its allies are trying to rein in a surge in global supply, driven mostly by the United States, where production surpassed 11 million bpd in 2018. Record high crude oil production C-OUT-T-EIA has pushed up U.S. inventories. OPEC oil supply fell in December by 460,000 barrels per day (bpd) to 32.68 million bpd, a Reuters survey found last week, led by cuts from top exporter Saudi Arabia. “We continue to view the OPEC production cuts that became official last week as a legitimate bullish consideration and we still look for the reduction to translate to a reduced U.S. crude surplus that could potentially be erased in some 8-9 weeks,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note. U.S. crude inventories at Cushing, Oklahoma, the delivery point for U.S. crude futures, fell by 565,000 barrels from last Tuesday to Friday, traders said, citing data from market intelligence firm Genscape. More upbeat equity markets also offered support. “When stock markets are strong oil usually follows suit,”
Oil Holds Above $48 - West Texas Intermediate (WTI) crude oil for February delivery gained 56 cents Monday to settle at $48.52 per barrel. The WTI remained above the $48 mark during the early week session, trading within a range from $48.11 to $49.79. Brent crude oil futures also exhibited positive momentum Monday. The March contract picked up 27 cents to end the day at $57.33 per barrel. Also on Monday, Rystad Energy released a report revealing a downward trend in U.S. hydraulic fracturing activity as 2018 progressed. According to the consulting firm, the number of daily frac jobs nationwide averaged from 48 to 50 from April to Aug. 2018 but slid to the 44 to 46 range from September to November. “Looking at preliminary data for November, we see evidence that seasonal activity deceleration has likely started in all major plays except Eagle Ford,” stated Lai Lou, senior energy analyst with Rystad. “There has been a considerable slowdown in Bakken and Niobrara in November, our analysis shows.” The price of a gallon of reformulated gasoline (RBOB) remained largely flat Monday. The February RBOB contract declined by less than a penny, settling at $1.34. Although colder temperatures are expected to bring more seasonal conditions to the Great Lakes and Northeast regions this week, natural gas futures retreated on Monday. The February Henry Hub natural gas price shed 10 cents to settle at $2.94.
Oil prices rise on trade talk optimism, OPEC cuts - Oil prices rose slightly on Tuesday, supported by hopes that talks in Beijing between U.S. and Chinese officials might defuse a trade dispute between the world's two biggest economies, while OPEC-led supply cuts also tightened markets.International Brent crude futures gained 88 cents, or 1.5 percent, to $58.21 per barrel by 9:38 a.m. ET (1438 GMT). U.S. West Texas Intermediate (WTI) crude oil futures climbed 76 cents, or 1.6 percent, to $49.28 per barrel. U.S. Commerce Secretary Wilbur Ross said on Monday that there was a "very good chance" of reaching a settlement, while China's Foreign Ministry said Beijing had the "good faith" to resolve trade friction with the United States. Some analysts warned, however, that the relationship between Washington and Beijing remained shaky and that tensions could soon flare anew. "Surely, there will be more twists and turns in the saga and increasing U.S. tariffs on Chinese goods after March from 10 percent to 25 percent cannot be excluded," Tamas Varga of PVM Oil Associates said. "For now, however, optimism prevails." There is also concern that a worldwide economic slowdown will dent fuel consumption, leading the hedge fund industry to cut significantly its bullish positions in crude futures. S&P Global Ratings said it had lowered its average oil price forecasts for 2019 by $10 per barrel to $55 and $50 per barrel for Brent and WTI, respectively. "Our lower oil price assumptions reflect slowing demand and rising supply globally," said S&P Global Ratings analyst Danny Huang. Crude prices so far in 2019 have been buoyed by supply cuts from OPEC including top exporter Saudi Arabia, as well as non-member Russia.
Why this week's US-China trade talks are a big deal for oil prices - The outcome of trade talks between the United States and China this week will play a major role in determining whether oil prices can continue to rally, analysts tell CNBC. Oil prices have risen for six straight sessions, clawing back gains after falling to 1½-year lows last month. The cost of crude collapsed more than 40 percent between early October and late December on concerns about slowing economic growth and oversupply in the oil market.Amrita Sen, chief oil analyst at research firm Energy Aspects, thinks crude futures have more room to run, but says the recovery is on shaky ground. "I think as long as the global economy isn't collapsing, we should be able to climb a little bit higher, but it is going to be very fragile because the biggest, biggest uncertainty right now is the trade war going on between the U.S. and China," she told CNBC Europe's "Squawk Box" on Monday. U.S. and Chinese trade representatives are meeting Monday and Tuesday to negotiate a path forward in the nations' ongoing trade dispute. The two countries have slapped tariffs on hundreds of billions of dollars worth of one another's goods. Additional tariffs threaten to weigh on global economic growth, and consequently, demand for oil and fuel. This comes at a time when forecasters have already warned that oil demand will grow more slowly than previously anticipated in 2019. According to Sen, oil prices fell too far, too fast, largely due to technical factors such as automated trading strategies. On the supply side, production cuts by major oil producers and slower-than-expected U.S. output will help oil prices recover, she says. Whether or not the market is oversupplied will largely boil down to demand. "At current levels, based on current fundamentals, the market is oversold," Sen said. "But it doesn't mean that it's going to correct straightaway, right? It can still take some time, unless and until you have the clarity, particularly with the trade talks over today and tomorrow."
China trade war and US shale are the biggest concerns for outgoing OPEC chief --The U.S.-China trade war and booming American shale production are among the top worries for the United Arab Emirates' energy minister and former OPEC president. After a volatile year for oil prices, hydrocarbon-exporting countries are buckling down for what could be more turbulence ahead.In terms of geopolitical headwinds for 2019, "One is the potential of heated war between China and the United States," Suhail Al Mazrouei told CNBC's Hadley Gamble on Wednesday. Mazrouei finished his term at the helm of OPEC on January 1. I think this is one fundamental, not only affecting us but affecting the whole economics of the world. And I tend to be... more optimistic that we are not going to see a war. It's negotiation tactics, they will end on a resolution, whatever it takes, this year or next year." While cautiously optimistic on the outcome of ongoing trade negotiations between the world's two largest economies, Mazrouei stressed the impact of U.S. shale production on the market — something that's increasingly putting OPEC members under pressure. "But this is one thing, how much is coming from the shale oil production I think that's another factor we need to watch and we need to advise that it has to be reasonable," the minister said. And the Energy Information Agency has upgraded its supply growth outlook for American crude. U.S. domestic oil production is now expected to increase by 1.18 million bpd next year with output averaging 12.06 million bpd. That flood of fresh U.S. crude supply "will cement its newfound position as the world's top oil producer," according to consultancy firm PVM Oil Associates. Asked about the growing criticisms of OPEC coming from the White House, Mazrouei maintained that OPEC listens to what the U.S. has to say when it comes to oil prices and production but insisted that the cartel "always does the right thing." "I think what we do is we hear them (the U.S.). They are major consumers versus the major producing nations, we hear what they say but we will always do the right thing from our perspective which is always trying to maintain the balance (in supply and demand)."
Oil prices rise more than 2 percent on trade talks - (Reuters) - Oil prices rose more than 2 percent on Tuesday, supported by hopes that crude demand may rise more quickly if talks between U.S. and Chinese officials resolve the trade dispute between the world’s two biggest economies. U.S. West Texas Intermediate (WTI) crude oil futures CLc1 settled up $1.26, or 2.6 percent, at $49.78 a barrel. During the session, the contract touched $49.95, the highest since Dec. 17. Brent crude futures LCOc1 rose $1.39 a barrel, or 2.4 percent, to $58.72. “The trade situation is definitely bullish; you have a good demand construction if we can wrap up this trade deal,” said Bob Yawger, director of futures at Mizuho in New York. The talks are going well so far and will continue on Wednesday, U.S. delegation member Steven Winberg said. These are the first face-to-face meetings between officials from the two countries since U.S. President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce in a trade war that has buffeted global financial markets. On Monday, U.S. Commerce Secretary Wilbur Ross and China’s foreign ministry expressed optimism on resolving the dispute. Some analysts warned, however, that tensions could flare anew. Oil traders also worried that a possible worldwide economic slowdown could dent fuel consumption. The hedge fund industry has cut significantly its bullish positions in crude futures. S&P Global Ratings said it had lowered its average oil price forecasts for 2019 by $10 per barrel to $55 for Brent and $50 per barrel for WTI. “Our lower oil price assumptions reflect slowing demand and rising supply globally,” said S&P Global Ratings analyst Danny Huang.
WTI Jumps After Bigger Than Expected Crude Draw - WTI rallied once again today but was unable (again) to break above $50 helped reflexively by stocks resurgence.“Saudi Arabia will continue to be the decisive factor for the markets this year, just as they were last year,” said Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt.“They can be very convincing when they choose to be. And so we see the potential for Brent crude to go to $70 a barrel over the course of the year.”But overall price action has been positive into today's API inventory data.“There’s a confluence of factors helping -- a big driver is progress in trade talks and hopes that global growth will be supported,” said Stephen Innes, head of trading for Asia Pacific at Oanda Corp.“Fed’s easier stance and OPEC’s commitment to cut production, as well as expectations that inventories should drop are lending a hand to this positive investor sentiment.” API:
- Crude -6.127mm (-2.7mm exp)
- Cushing +331k
- Gasoline +5.5mm
- Distillates +10.2mm
Massive surges in gasoline and distillate inventories with a fractional crude build last week were dominated by API data for the last week showing a bigger than expected crude draw (and we suspect catch up builds in API data after DOE's data)...
OPEC cuts, US-China trade talks empower oil bulls — Crude futures settled higher Tuesday, extending the price rally for a seventh straight session amid growing evidence that OPEC supply cuts will tighten the market this year. ICE March Brent settled $1.39 higher at $58.72/b and NYMEX February WTI was up $1.26 to settle at $49.78/b. The oil complex gleaned support Tuesday from widespread optimism that ongoing US-China trade talks may avert a global economic slowdown by thawing tense relations between the two countries. NYMEX product futures also finished the day higher, with February ULSD settling 4.54 cents higher at $1.8238/gal and February RBOB up 2.19 cents at $1.3626/gal at market settle. While bullish sentiment stemming from a possible US-China rapprochement has supported prices this week, it is growing evidence of a tighter supply picture that has sustained the 2019 rally. OPEC's December crude output fell 630,000 b/d to a six-month low of 32.43 million b/d, an S&P Global Platts survey of industry officials, analysts and shipping data showed Tuesday. The cuts were led by Saudi Arabia, which trimmed its production 401,000 b/d to 10.6 million b/d last month. Riyadh has pledged to further cut January production to around 10.2 million b/d, well below the 10.31 million b/d level it pledged to maintain for the first half of 2019 as part of the 1.2 million b/d cuts OPEC and its allies agreed to in early December. Furthermore, Saudi Arabia announced Monday it would cut exports to around 7.1 million b/d by the end of January, with a goal of sending Brent crude to an $80/b level. But the price reaction to the announced cuts has so far been tepid as the market has instead waited for tangible signs of lowered output.
Why Have Oil Markets Turned So Bullish?- – Oil prices continue to post gains, extending a rally that is the longest in 17 months. The latest optimism centers on the ratcheting down of tensions between the U.S. and China, as well as a softer tone from the U.S. Federal Reserve. In the oil market, the OPEC+ cuts are phasing in, while Saudi Arabia has pledged to cut even deeper. “Saudi Arabia will continue to be the decisive factor for the markets this year, just as they were last year,” Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt, told Bloomberg. “They can be very convincing when they choose to be. And so we see the potential for Brent crude to go to $70 a barrel over the course of the year.” Saudi Arabia will reportedly cut oil exports by 800,000 bpd below November levels, going beyond what it had promised as part of the OPEC+ agreement. The Wall Street Journal reports that the Saudis are cutting deeper in hopes of engineering a price rise to $80 per barrel. Oil prices rose sharply on the news on Monday, but the market still seems too soft for a return to $80 per barrel anytime soon. Riyadh is under fiscal pressure as the Saudi budget does not breakeven unless oil prices are in the mid-$80s. The UK’s North Sea saw 13 final investment decisions in 2018, more than the previous three years combined. Leaner and more efficient projects have helped the mature oil basin stage somewhat of a rebound. However, exploration is still at a record low, according to the FT. That raises questions about the viability of the region in the long run. Meanwhile, BP (NYSE: BP) is considering selling its stake in the Shearwater assets in the North Sea, which would free up the company to focus on its increasing presence in U.S. shale. A sale could be worth several hundred million dollars, according to Bloomberg.
Oil prices surge on hopes of successful US-China trade talks - Oil prices climbed 3 percent on Wednesday as the extension of U.S.-China talks in Beijing raised hopes that the world's two largest economies would resolve their trade standoff. U.S. West Texas Intermediate (WTI) crude oil futures were at $51.44 per barrel at 9:37 a.m. ET (1437 GMT), up $1.66, or 3.3 percent, the first time this year that WTI has topped $50. International Brent crude futures were up $1.74, or 3 percent, at $60.46 per barrel. Both crude price benchmarks added to Tuesday's 2 percent gains and have now been on the rise for eight straight days — their longest rally since June 2017. "After a dreadful December for risk markets, crude oil continues to catch a positive vibe," said Stephen Innes at futures brokerage Oanda in Singapore, citing tensions between the superpowers which have cast a pall over the world economy. The trade talks in Beijing were carried over into an unscheduled third day on Wednesday, amid signs of progress on issues including purchases of U.S. farm and energy commodities and increased U.S. access to China's markets. "Talks with China are going very well!" U.S. President Donald Trump tweeted, without elaborating. State newspaper China Daily said on Wednesday that Beijing was keen to put an end to its trade dispute with the United States, but that any agreement must involve compromise on both sides. Stephen Brennock, analyst at London brokerage PVM Oil, warned against excessive optimism. "Buyers have placed all their betting chips on the US and China resolving their trade spat," he said. "A failure to secure a meaningful breakthrough in the coming days will therefore spark a turnaround in sentiment. It is also worth noting that the global economic outlook continues to darken," he added. The World Bank expects global economic growth to slow to 2.9 percent in 2019 from 3 percent in 2018, it said in a semi-annual report released late on Tuesday.
Oil Extends Longest Rally in 1.5 Years -- Oil rose back above $50 a barrel, extending its longest rally in 1 1/2 years as global risk assets were buoyed by the prospect of a thaw in trade tensions between the world’s biggest economies. Futures in New York -- which last traded over $50 in December -- are up for an eighth straight session, rebounding from a collapse of almost 40 percent in the final quarter of 2018. U.S. President Donald Trump is said to be eager to strike a deal with China soon to perk up financial markets that have slumped on concerns over a trade war between the nations. Asian stocks on Wednesday followed a rally in the U.S. on investor optimism. For oil bulls, the brightening economic outlook provides some comfort after fears that the long-running trade war will hurt demand helped drag prices into a bear market from a four-year high in October. Confidence is also strengthening that the Organization of Petroleum Exporting Countries and its allies including Russia will curb output enough to counter booming U.S. supplies and avoid an oversupply. “Overall investor sentiment on risk assets is improving as the ongoing talks between the U.S. and China ease uncertainties in the market,” Ahn Yea Ha, a commodities analyst at Kiwoom Securities Co., said by phone from Seoul. “On the other hand, OPEC is signaling that it’s determined to clear a supply glut, which is also supporting crude prices.” West Texas Intermediate for February delivery climbed as much as 88 cents, or 1.8 percent, to $50.66 on the New York Mercantile Exchange, the first time it’s back above $50 since Dec. 17. It was at $50.42 at 7:56 a.m. in London. Prices have advanced about 12 percent over the previous seven sessions, undoing almost half of 2018’s full-year loss. Brent for March settlement rose 70 cents to $59.42 a barrel on the ICE Futures Europe Exchange in London. It’s jumped over 12 percent over seven sessions. The global benchmark crude traded at a premium of $8.69 a barrel to WTI for the same month. U.S.-China trade negotiations in Beijing have been concluded after being extended by a day which shows both the sides are serious, according to a Chinese foreign ministry spokesman. The talks were originally scheduled for two days, and Trump had earlier expressed optimism in a tweet, exclaiming “Talks with China are going very well!”
WTI Tumbles After Massive Gasoline, Distillates Inventory Builds - WTI crude has soared through $50 (and Brent above $60) overnight after API reported a surprisingly large crude draw and helped by a plunging US Dollar and hope around US-China trade talks.As Bloomberg reports, fears of a slowdown in oil demand are receding with an easing of the long-running trade tensions, which helped drag crude prices into a bear market after they hit a four-year high in October. Confidence is also strengthening that the Organization of Petroleum Exporting Countries and its allies including Russia will curb output enough to counter booming U.S. supplies and avoid an oversupply.“There is positive momentum in the oil market in the new year as economic optimism seeps back in,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA.“If this state of affairs persists, OPEC and non-OPEC supply cuts that go into effect this month will prove more effectual in attenuating predicted implied global stock builds in 2019.” DOE:
- Crude -1.68mm (-2.7mm exp)
- Cushing +330k
- Gasoline +8.066mm - biggest since Dec 2016
- Distillates +10.611mm - biggest build since Jan 2015
API reported a major crude draw but huge builds in gasoline and distillates (though the latter may have been catch-up to the official data's large builds in the prior week) and DOE confirmed the biggest distillates build in four years and a huge gasoline build, combined with a smaller than expected crude draw...
Oil Enters Bull Market As Short CTAs Are Wiped Out -- After crude suffered a near record, 44% plunge in the fourth quarter, one which left commodity funds reeling and both OPEC and oil exporting nations in a panic, oil stormed back into bull market territory, as investors who’d abandoned crude just a month ago were lured back by an OPEC-led campaign to bring runaway supplies in check coupled with algos who turned from net short back to long.WTI crude closed above $52 a barrel, staging a powerful, 23% recovery after hitting an 18-month low on Christmas Eve. Brent, likewise, finished the day up 22% since bottoming out. After ending 2018 in a deep bear market, oil sharply reversed course on signs that oil exporters will follow through on last month’s pledge to slash production, with Saudi Energy Minister Khalid Al-Falih repeating that the plan was on track Wednesday even if DOE energy stocks showed a smaller drop in inventory thatn expected. The bigger catalyst in recent weeks, however, was hope that the U.S.-China trade war may be ending, boosting demand from the world's largest oil importer adding to oil’s momentum, even if hopes that the just concluded trade talks would lead to any immediate resolution turned out to be false. “‘Sentiment went from completely negative a couple of weeks ago to very positive right now,” said Matt Sallee, a portfolio manager who helps oversee $16 billion in energy assets for Kansas-based Tortoise. “Everyone’s just focused on the Saudis and they seem quite determined."
Oil prices rally 5%, highest levels in more than three weeks – Oil futures were on track Wednesday to finish at their highest levels in more than three weeks, with the U.S. benchmark topping $50 a barrel on continued optimism over U.S.-China trade talks and a weekly decline in domestic inventories. U.S. government data Wednesday, however, also revealed much bigger-than-expected increases in stockpiles of gasoline and distillates last week, prompting futures to briefly pare earlier gains.“Oil has yet to have a losing session in 2019, and the near-term path of least resistance is still higher based on momentum and near-term technicals,” said analysts at the Sevens Report. “However, the longer-term outlook is still unclear as production/export cuts won’t be enough to curb another bout of broad market volatility based on peak earnings concerns (if Q4 reporting season underwhelms) and economic growth doesn’t show signs of picking up.” West Texas Intermediate crude for February delivery rose $1.27, or 2.5%, to $51.05 a barrel, trading above the $50 level on an intraday basis for the first time since Dec. 14. A settlement at or above $51.04 would lift WTI out of bear market territory, according to Dow Jones Market Data, marking a rise of 20% or more from a closing low of $45.30 on Dec. 24.A positive finish would extend oil’s winning streak to eight sessions, the longest in about 18 months. March Brent crude rose $1.02, or 1.7%, to $59.74 a barrel, with prices for the most-active contract poised for its highest finish since mid-December.U.S.-China trade talks concluded Wednesday after being extended to a third day. Global stocks rose, with U.S. equities edging higher on Wall Street, and Bloomberg reporting that President Donald Trump is eager to complete a deal on the expectation that it would boost financial markets battered in part due to fears surrounding the trade battle. Analysts at Commerzbank said trade-related optimism was also lifting crude, noting that the slump in oil prices at the end of 2018 “was driven not only by the oversupply, but also by the selloff on the stock markets. This was due to fears that the trade conflict will slow economic growth in the U.S. and China, ultimately also dampening oil demand in the two leading oil consumer countries.”
Oil falls 1 pct on swelling US supply, concerns on US-China trade talks (Reuters) - Oil prices fell by about 1percent on Thursday on swelling U.S. supply and amid a cautious reaction to trade talks between the United States and China, the world's two largest oil consumers, that finished without concrete details to ending their dispute. U.S. West Texas Intermediate (WTI) crude oil futures CLc1 were at $51.80 per barrel at 0432 GMT, down 56 cents, or 1.1percent, from their last settlement. International Brent crude futures LCOc1 were down 0.9percent, or 57 cents, at $60.87 per barrel. Both oil benchmarks rose by around 5 percent the previous day as financial markets around the world surged on the hopes that Washington and Beijing may soon be able to end their trade dispute, soothing fears of an all-out trade war between the two biggest economies and its possible impact on global growth. By Thursday, however, the positive feelings ebbed because ofa lack of a details on the talks despite a warm statement form China on the outcome, and financial markets took a breather from the rally. Vandana Hari of consultancy Vanda Insights in Singapore said in a note that oil prices dropped "as optimism fuelled by the U.S.-China trade talks earlier in the week appeared to have run its course and official statements after the conclusion of three days of negotiations, while indicating modest progress, lacked details." Meanwhile, U.S. bank Morgan Stanley cut its 2019 oil price forecasts by more than 10 percent on Wednesday, pointing to"weakening economic growth expectations" and rising oil supply from especially from the United States as reasons for their lower price forecast.
Oil rises again but global economic concerns cap gains (Reuters) - Crude prices edged higher on Thursday, supported by comments from the U.S. Federal Reserve chairman that lifted equity markets, but a more than week-long oil rally slowed as optimism surrounding U.S.-China trade talks faded. Brent crude LCOc1 futures rose 24 cents, or 0.4 percent, to settle at $61.68 a barrel. The global benchmark posted its first consecutive nine-day winning streak since September 2007. West Texas Intermediate crude CLc1 ended 23 cents, or 0.4 percent, higher at $52.59 a barrel, also its ninth straight day of gains, that beats a 2010 record. Earlier in the session, both benchmarks hit their highest in nearly a month. WTI hit a session high of $52.78 per barrel and Brent rose to $61.91 a barrel. Global financial markets have climbed recently on hopes that Washington and Beijing would avert an all-out trade war. The two superpowers concluded three days of talks on Wednesday. But the rise in global markets began to dwindle after the world’s two largest economies issued vaguely positive statements that lacked concrete details.[.N][USD/] Comments by Federal Reserve Chairman Jerome Powell on Thursday helped boost riskier asset classes, including oil, late in the session. Powell said the U.S. central bank had the ability to be patient on policy, but that the Fed would shed significantly more assets than it already has. “It was a mixed message from him, but I think it was sufficiently accommodative,” said John Kilduff, a partner at Again Capital Management. “It’s a continuation of that shift towards easier policies and more assistance to the underlying economy which helped boost crude oil prices.” U.S. equity markets broadly rose after the comments. [.N] Recently crude futures have tracked closely with Wall Street.
Oil Set for Biggest Weekly Gain in Two Years - -- Oil headed for its biggest weekly gain in over two years on hopes that OPEC will manage to shrink a glut and trade tensions between the U.S. and China will ease. Futures in New York have advanced 10 percent this week, as Saudi Arabia pledged that a producer coalition it’s leading will keep the market in balance. Still, prices are about 30 percent lower than their highs in October even after a rebound since Christmas Eve thrust crude back into a bull market. That signals investors need reassurance that the group will curb supply sufficiently and demand will hold up. Crude’s direction in coming weeks may be determined by whether the Organization of Petroleum Exporting Countries and allies including Russia implement output cuts they have promised for the first six months of 2019. Also crucial will be the outcome of trade negotiations between the U.S. and China -- the world’s two biggest economies. A deal between the nations could boost flagging global growth that underpins oil demand. “Oil has had a good rally as Saudi Arabia’s willingness to move forward with cutting output was clearly delivered to the market,” said Hong Sungki, a commodities trader at NH Investment & Securities Co. in Seoul. “But the trade negotiations between the U.S. and China still add some uncertainty to global financial and oil markets, possibly leading to corrections in prices in the shorter term.” West Texas Intermediate for February delivery traded 20 cents higher at $52.79 a barrel on the New York Mercantile Exchange as of 4:01 p.m. in Singapore on Friday. Futures rose 0.4 percent on Thursday, in their ninth straight daily advance and longest winning streak in nine years.
The Oil Bull Market Is Back - Oil entered a bull market this week, having gained 20 percent since the low point reached in December. WTI rose above $52 per barrel, while Brent moved above $61. “The mood brightens, and the market realizes that the world economy and oil demand are not grinding to a halt,” Norbert Ruecker, head of macro and commodity research at Julius Baer Group Ltd. in Zurich, told Bloomberg. “Moreover, there is confidence that the petro-nations will cut supplies as promised to balance the market.” Saudi Aramco released figures on its oil reserves this week, a figure that has been the subject of speculation for decades. The independent audit was originally initiated in anticipation of Saudi Aramco’s now-delayed IPO. The audit largely confirmed what Saudi officials have long said – that the Kingdom is sitting on massive reserves. The audit revealed 266.3 billion barrels of oil reserves and 307.9 trillion cubic feet of natural gas. Meanwhile, Aramco is expected to issue its first ever international bond sale later this year, with plans to use the proceeds to finance its acquisition of petrochemical giant Sabic. BP plans on drilling six new exploration wells in Azerbaijan by 2020, with the hopes of making another giant natural gas discovery. BP only recently brought its $28 billion Shah Deniz gas field online, but as Bloomberg reports, the oil major hopes to replicate that success. “Alongside Brazil, Azerbaijan stands out in terms of the areas of focus for the next few years,” Gary Jones, BP’s regional president for Azerbaijan, Georgia and Turkey, told Bloomberg in a phone interview. “It’s a very significant exploration program for us, which demonstrates the confidence and the role that we see in the Caspian.” The oil industry will increase offshore spending by 6 percent this year, according to Bloomberg and Rystad Energy. That figure will jump to a 14-percent increase in 2020.
Oil prices dip as worries over economic slowdown return --Oil prices fell more than 1 percent on Friday but were on track for weekly gains after financial markets strengthened on hopes the United States and China may soon resolve their trade dispute.Crude futures began falling shortly after U.S. crude hit a five-week high above $53 a barrel and moved above its 50-day moving average for the first time since mid-October."The move above $53 engendered some profit-taking, as it should," said John Kilduff, founding partner at energy hedge fund Again Capital.International Brent crude futures were at $60.84 per barrel at 11:38 a.m. ET (1638 GMT), down 84 cents, or 1.4 percent.U.S. West Texas Intermediate crude futures fell 75 cents, or 1.4 percent, to $51.84 per barrel.WTI and Brent are set for their second week of gains, rising about 8 percent and 6 percent respectively.Tightened supply following OPEC-led crude production cuts aided earlier 1 percent increases for both oil benchmarks, but concerns about the global economy kept markets in check."Profit-taking has weighed on oil prices in today's trading session following gains made earlier in the week," said Abhishek Kumar, senior energy analyst at Interfax Energy in London. "A lack of tangible progress in the U.S.-China trade talks, ongoing political uncertainty in the U.S., and fears that China's weakening economy could adversely hit global oil demand have also contributed toward the weakness in oil prices."
U.S. benchmark oil snaps longest win streak in 9 years, but books weekly gain - Oil futures ended lower Friday, pulling back a day after U.S. prices tallied their longest streak of consecutive session gains in nine years, but scoring a second weekly climb in a row.A move higher in the last few minutes of trading on Thursday allowed oil futures to notch a ninth straight session of gains. That was the longest winning streak since January 2010 for the U.S. benchmark. For global benchmark Brent, it was the longest in more than 11 years.“I think oil prices went up too high too quick, without a pause, so what we are seeing could simply be profit taking at around key resistance levels,” said Fawad Razaqzada, market analyst at Forex.com. However, “fundamentally, the outlook doesn’t look too bright. Not only is non-OPEC supply [looking] set to rise, but the demand outlook doesn’t look too great this year.”In Friday dealings, West Texas Intermediate crude for February deliveryCLG9, -1.69% fell $1, or 1.9%, to settle at $51.59 a barrel. The settlement Thursday at $52.59 a barrel on the New York Mercantile Exchange was the highest since Dec. 7, according to Dow Jones Market Data. WTI posted a weekly rise of about 7.6%. Prices climbed out of a bear market Wednesday and as of Friday’s settlement, have climbed by about 21% from the 52-week low of $42.53 on Dec. 24.
Trump 'hasn't been fair' to OPEC, Oman's oil minister says -- Oman's oil minister thinks President Donald Trump has given OPEC some undue flak. But echoing other Gulf ministers, Mohammed bin Hamad al-Rumhi stressed his desire to steer clear of political animosity with the American leader, appearing keen to give him the benefit of the doubt."Sometimes he hasn't been fair," al-Rumhi told CNBC's Hadley Gamble while at the Atlantic Council's Global Energy Forum in Abu Dhabi. "I'm sure he has good intention too, he thinks he is representing the people of the U.S. and he thinks this is the way to do it.""Nobody wants volatility, I am sure Trump doesn't want volatility, because volatility is difficult to manage," he said. Trump has spent months vocally criticizing the 14-member cartel for its management of oil output, urging the group to keep the taps open and oil prices low. "OPEC is ripping us off," Trump said in a tweet last October.In December, OPEC members along with Russia reached an agreement to cut their crude production by 1.2 million barrels of oil per day from the market in order to stem the fall in prices, something that further drew Trump's ire. "Unfortunately there are politics, but sometimes the politics forces people to go to the social media or to CNBC to present their case. And that is the reality of today," the minister said.
Saudi Arabia's massive oil reserves total 263 billion barrels, even bigger than previously known - Saudi Arabia's massive oil and gas reserves are even bigger than previously reported, according to an outside assessment commissioned by the kingdom. The independent audit not only revised Saudi reserves higher, but may help put to rest skepticism over the nation's oil and gas wealth, which has persisted in some corners of the market for years. It also shows national oil giant Saudi Aramco is taking strides towards transparency as it continues to consider a stock market debut. On Wednesday, Saudi Energy Minister and Aramco Chairman Khalid al-Falih said the kingdom expects the initial public offering for Aramco to take place in 2021, following a delay. State-controlled Aramco had 263.1 billion barrels of oil waiting to be tapped at the end of 2017, according to Dallas-based petroleum consulting firm DeGolyer and MacNaughton. That is 2.2 billion barrels more than Aramco reported in its last annual review. Aramco's natural gas reserves total 319.5 trillion cubic feet, according to the audit. The company, which is not a major player in the gas market, previously reported 302.3 trillion cubic feet of gas reserves. Saudi Arabia has additional reserves in an area along the border with Kuwait that has sat idle due to a dispute between the neighbors. Including this so-called Neutral Zone, Saudi oil reserves total 268.5 billion barrels, DeGolyer and MacNaughton concluded. That compares with an earlier estimate of 266.3 billion barrels.
Saudi Arabia’s Great Run Seems Headed for Trouble - In purchasing power parity terms, Saudi Arabia is a rich country — only slightly behind the U.S. in living standards. Meanwhile, the country’s leadership is feeling confident and powerful enough to prosecute awar in Yemen and kill dissident journalists.But beneath the placid surface, there could be trouble brewing. First of all, the country’s demographics are headed in a direction that is sometimes associated with social unrest. As recently as 2000, Saudi Arabian families were very large, with an average of more than six children per woman. But fertility has dropped precipitously, and is now below the replacement level of 2.1 children per woman: This means that there are a large number of Saudi Arabians now coming of age who will have relatively few children of their own to take care of. In countries with economies based on manufacturing, this would produce a demographic dividend, causing growth to accelerate due to an abundance of young workers.But in Saudi Arabia’s resource-dependent economy, it may simply put a strain on government finances. Saudi Arabia has traditionally been a rentier economy, where government jobs distribute oil money to the population and keep social tensions from rising. A bigger population means more mouths to feed. And youth unemployment in the country typically hovers between 25 and 30 percent, while overall unemployment hit record highs in early 2018.A big cohort of idle young adults with high unemployment and relatively light child-care duties could be a volatile mix. Political scientists have long noted the correlation between youth bulges and civil strife. This volatile situation could be made even more precarious by three additional factors: declining oil revenues, climate change and social liberalization.
Saudi Arabia plots new path to long-delayed Aramco IPO - Saudi oil giant Aramco is undertaking a series of moves that may pave the way for a long-delayed stock market debut.The kingdom plans an initial public offering for Aramco in 2021, Saudi Energy Minister Khalid al-Falih said during a news conference Wednesday. Falih backed the latest target for the IPO with several announcements that would essentially prep the market for the debut, which is expected to be the largest ever. Saudi Arabia on Wednesday released the results of an independent audit that confirms the kingdom controls more than 260 billion barrels in oil reserves. The assessment makes the metrics behind the world's largest energy company — long the subject of skepticism — a bit less opaque to potential investors in Aramco."This certification underscores why every barrel we produce is the most profitable in the world, and why we believe Saudi Aramco is the world's most valuable company and indeed the world's most important," Falih said in a statement.Falih later announced Aramco will issue bonds in the second quarter of this year. In order to tap the debt market, Aramco will release additional financial information, offering a wider glimpse into a private company whose inner workings are a closely held secret. "That shows that Aramco's hesitation about doing an IPO is not about keeping information private," said Ellen Wald, an independent energy policy analyst at Transversal Consulting. "It's not because they're hiding something." Falih did not say how much the bond sale would seek to raise, but it is widely expected to underwrite at least part of Aramco's purchase of a majority stake in Saudi petrochemicals company Sabic. The 70 percent stake that Aramco intends to buy is controlled by Saudi Arabia's sovereign wealth fund and valued at roughly $70 billion.
Pompeo says oil prices don't influence US response to Khashoggi killing, contrary to Trump's stance - Secretary of State Mike Pompeo on Monday said oil prices did not and will not influence the Trump administration's response to the killing of Saudi dissident Jamal Khashoggi.Pompeo's remarks, made in an interview with CNBC's Wilfred Frost, come three months after Saudi agents killed the Washington Post columnist in the kingdom's consulate in Istanbul, Turkey. In November, President Donald Trump declared the United States stands with Saudi Arabia, even though the CIA has reportedly concluded that Saudi Crown Prince Mohammed bin Salman played a role in the slaying.At the time, Trump linked his stance to Saudi Arabia's help taming oil prices, as well as its role countering Iran in the Middle East and its pledge to buy more American-made weapons."Saudi Arabia, if we broke with them, I think your oil prices would go through the roof. I've kept them down. They've helped me keep them down," Trump told reporters after issuing a statement spelling out his support for the Saudi government.One day later, Trump thanked Saudi Arabia for taking steps to lower oil prices and implored the kingdom to push them even lower. Asked whether low oil prices influenced the administration's response, and whether Trump might take a tougher stance if the Saudis let oil prices rise, Pompeo said, "They're disconnected.""We've taken a very clear message to the world with respect to the murder of Jamal Khashoggi," Pompeo told CNBC. "This was a heinous act. It's unacceptable. It's inconsistent with the way nations ought to behave around the world."
US Approves Missile Defense Upgrades for Saudi Arabia Despite Khashoggi Outrage — Anger at the Saudi government’s murder of Jamal Khashoggi had many in the US Congress saying that they intend to limit arms sales to the kingdom. The Trump Administration appears to be ignoring that, however, and continuing with Saudi arms deals.The State Department has notified Congress that Saudi Arabia will be receiving major upgrades to their Patriot PAC-3 missile defense systems, including an improved guidance system. The upgrades are expected to be worth $195 million.The State Department says that the approval is in keeping with President Trump’s announcement that the US will remain a “steadfast partner” to the Saudis irrespective of what happened to Khashoggi.This has been the president’s position, and his supporters are citing missile fire from neighboring Yemen. Whether Congress will react to this remains to be seen, but the administration seems to be betting they won’t. It’s possible, with a defensive missile system, that Congress will defer the conflict over arms sales to the Saudis for something bigger and more offensive-minded. Many senators have promised to hold up future deals.
Instead of shunning Saudi Arabia after Khashoggi killing, investors flock to $7.5 billion bond sale - Saudi Arabia raised $7.5 billion in its first dollar bond sale since the killing of Saudi dissident and U.S. resident Jamal Khashoggi incited an international uproar. Khashoggi's killing sparked concerns that international investors would shun the kingdom. Saudi Arabia is prosecuting several agents and officials allegedly involved in the slaying at the Saudi Consulate in Istanbul. Riyadh denies that Saudi Crown Prince Mohammed bin Salman was involved in the murder, but the CIA has reportedly concluded that the king-in-waiting was complicit in the killing. While some business executives have cut ties with the kingdom over the incident, bond buyers do not appear ready to overlook an investment opportunity in Saudi Arabia, the world's largest oil exporter. The issuance was nearly four times oversubscribed, with the order book peaking at $27.5 billion, according to the Saudi Ministry of Finance. Saudi Arabia sold $4 billion in 10-year notes that mature in 2029, and $3.5 billion in in 31-year notes that come due in 2050. U.S.-based investors accounted for 40 percent of the 2029 bond purchases and 45 percent of the 2050 debt, according to Reuters. On Wednesday, Saudi Energy Minister Khalid al-Falih said state-owned oil giant Aramco will issue bonds in the second quarter of this year. The debt will most likely be issued in dollars, he said.
Teenager Who Fled Saudi Arabia Fears She’ll Be Killed If Sent Back Home — A Saudi woman held at Bangkok’s international airport has said she will be killed if she is repatriated by Thai immigration officials, who confirmed the 18-year-old was denied entry to the country on Sunday. Rahaf Mohammed M Alqunun told the AFP news agency she was stopped by Saudi and Kuwaiti officials when she arrived at Suvarnabhumi airport and her travel document was forcibly taken from her, a claim backed by Human Rights Watch.“They took my passport,” she said, adding that her male guardian had reported her for travelling “without his permission”.Human Rights Watch Asia deputy director Phil Robertson slammed the Thai authorities and urged the UN refugee agency to help the teenager.“What country allows diplomats to wander around the closed section of the airport and seize the passports of the passengers?” he said, adding that there is “impunity” within the family unit in Saudi Arabia to abuse women. The incident comes against the backdrop of intense scrutiny on Saudi Arabia over its investigation and handling of the murder of journalist Jamal Khashoggi in its Istanbul consulate last year, which has renewed criticism of the kingdom’s rights record.
UN Refers Saudi Teenager to Australia for Refugee Resettlement — The United Nations has asked Australia to consider refugee resettlement for an 18-year-old Saudi woman who fled to Thailand at the weekend saying she feared her family would kill her, the Australian government has said.“The UNHCR has referred Ms Rahaf Mohammed al-Qunun to Australia for consideration for refugee resettlement,” Australia’s Department of Homeland Security said in an email on Wednesday.The department said it would consider the referral “in the usual way, as it does with all UNHCR referrals”. It declined to comment further.The UNHCR office in Thailand also declined to comment.Qunun was stopped by authorities at Bangkok’s main airport as she arrived on a flight from Kuwait at the weekend after running away from her family, who she says subjected her to physical and psychological abuse.Thailand initially said it would deport her at the request of Saudi embassy officials, barring her from traveling on to Australia where Qunun said she had intended to claim asylum.But armed with a phone, she barricaded herself into an airside hotel room and fought back, live-tweeting her fears of deportation in a campaign that swiftly galvanized international support and prompted a sharp U-turn by Thai officials.Qunun is now in the care of the UN’s refugee agency in Bangkok, which is processing her case. Australian officials have strongly hinted that Qunun’s request will be accepted.
Six killed in “preemptive” security operation in Saudi Arabia’s Eastern Province - The bloody siege by security forces of a village in the coastal Qatif region of Saudi Arabia’s Eastern Province has left at least six people dead and a number of others wounded.The assault, described by Saudi officials as a “preemptive” security operation, saw heavily armed troops storm the village of Al-Jish after surrounding it for 15 hours. The Saudi regime claimed that the operation was aimed at capturing “terrorists” and that those killed had been given a chance to surrender but died in an “exchange of fire.”No credibility whatsoever can be given to this official story from a monarchical dictatorship that describes anyone who opposes its rule or dares to insult the Saudi king or the country’s de facto ruler, Crown Prince Mohammed bin Salman, as a “terrorist,” whose offenses are punishable by beheading.The Eastern Province, where the siege took place, has been the scene of continuous repression by the Saudi regime since 2011, when demonstrations broke out among the area’s Shia population demanding democratic rights and an end to the systemic discrimination exercised by the monarchy, whose rule is bound up with the official, state-sponsored religious doctrine of Wahhabism, an ultra-conservative Sunni sect.The leader of the 2011 protests, the Shia cleric Nimr al-Nimr, who called for an end to the monarchy, was executed in January 2016, along with 46 others on charges of “terrorism.” Forty-three were beheaded, and four were shot to death by firing squads.The brutal repression has left the region, which is a center of Saudi Arabia’s oil industry, but whose population is the poorest in the country, seething. Sporadic demonstrations have continued, even as the Saudi regime maintains what amounts to a military occupation.
Drone Attack on Saudi Military Parade in Yemen Kills Top Coalition Officials — Yemen’s military, loyal to the Houthis, launched a retaliatory drone attack against a Saudi-led coalition military parade at Saudi Arabia’s Al-Anad airbase in Yemen’s southern province of Lahejj, killing several military personnel.Saudi state-owned media confirmed that multiple high-ranking officials were killed and several others injured when a combat drone struck an airbase where a military parade was taking place.A source in Aden told MintPress News that 20 people were killed and more than 25 injured, including Saudi coalition military leaders and a high-ranking member of Saudi Arabia’s presidential forces — adding that those figures may increase, as new casualties were still arriving in Aden amid an intense security presence.A Yemeni military source told MintPress that Yemen’s air force carried out the attack using a new type of unmanned aerial vehicle (UAV or drone) dubbed the Qasaf 2k (Canteen 2k). The Qasaf 2k is laden with a large amount of fragmented explosives and has a unique design which allows it to discharge its payload downwards at a distance of around of feet. A spokesman for the Yemeni army said the operation came in response to the continuation of Saudi-led coalition airstrikes and the targeting of innocent civilians. A recent Saudi-led coalition airstrike killed two civilians and injured three others when their home was targeted in the village of al-Fara in northwestern Yemen’s Hardh district on Thursday. Coalition attacks and airstrikes are ongoing despite a truce that was reached in Sweden in December 2018. Saudi coalition military officials say the dead and wounded include officers and senior military leaders, cohorts that in southern Yemen contain a strong contingent from the United Arab Emirates (UAE). The UAE oversees the Al-Anad base, the coalition’s largest in Yemen.
Iran Prepares Satellite Launch, Ignoring US Warnings, Says It’s For Peaceful Purposes - Despite recent warnings from U.S. Secretary of State Mike Pompeo, Iran is preparing to launch a remote sensing satellite into space, satellite images obtained by CNN on Tuesday showed. Researchers at the Middlebury Institute of International Studies at Monterey, California, stated that the images, which were taken on Jan. 4, 6 and 7, 2019 by Planet Labs, an American private Earth imaging company, showed activity at Iran’s aerospace company "Imam Khomeini Space Center." The recent activity was similar to steps that were taken before the launch of a previous satellite by Iran in 2017. Despite Pompeo's stance that the launch vehicle contains technology used in ballistic missiles, there is no evidence to prove that the launch is for military purpose. Images show that preparations for the launch of the satellite into orbit are underway. The satellite will be launched with the help of a Simorgh space launch vehicle which is an Iranian expendable small-capacity orbital carrier rocket. Jeffrey Lewis, of the Middlebury Institute of International Studies at Monterey said, "The Simorgh is a two-stage space launch vehicle that uses a cluster of four Shahab-3 engines in its first stage and smaller steering engines in its upper stage.” The photograph captured outside the site's assembly and checkout building on Jan. 4 showed a large white shipping container. Analysts believe the white container was likely used to transport the rocket's first stage before its reassembly on the launch pad. Photographs also showed a large vehicle and a fuel truck parked on the site. "The appearance of this canister is a strong indication that a rocket has been transported to the site and a space launch is likely in the coming weeks," Lewis said. Earlier this month, Pompeo had warned Iran of new sanctions if it went ahead with its planned satellite launches. He also stated that the country had planned to launch three rockets called the Space Launch Vehicles (SLV) within the next few months. He also said, these rockets had technology “virtually identical” of those used in intercontinental ballistic missiles.
US navy Seal pleads not guilty to murdering Islamic State prisoner - A decorated navy Seal has pleaded not guilty to charges of premeditated murder and other crimes in the stabbing death of a teenage Islamic State prisoner in Iraq and the shooting of unarmed Iraqi civilians. Special operations chief Edward Gallagher has been jailed since his September arrest, and a judge said he would rule next week whether the 19-year navy veteran should be released before trial. He was due to stand trial 19 February. “He didn’t murder anyone,” his attorney Phil Stackhouse told reporters outside the courtroom at a naval base San Diego. “He didn’t shoot at innocent people in the street.” Navy prosecutors have painted a picture of a highly trained fighter and medic going off the rails in 2017 on his eighth deployment, indiscriminately shooting at Iraqi civilians and stabbing to death a captured Islamic State fighter estimated to be 15 years old, then posing with the corpse, including at his re-enlistment ceremony. The case is unusual because of the seriousness of the allegations against an elite soldier and because the case includes accounts of fellow Navy Seals, an extremely tight-knit group even by military standards. At Gallagher’s arraignment, prosecutors handed over 1,700 pages of documents, including text messages they say show he tried to intimidate witnesses.
US Attacks in Syria Increased After Trump’s Withdrawal Announcement — Despite US President Donald Trump’s announcement that he will withdraw US troops from Syria, American strikes in the east of the country have increased.This was revealed Thursday by an investigation conducted by Al Jazeera and The Intercept, which found that there are about 50,000 to 60,000 people stuck in eastern Syria – which is dominated by Daesh – living under these US attacks.An activist, who refused to give his name, was reported saying: “The civilians in these areas have no place to go or hide from the US bombardment of their villages.” He added that the residents have been harmed at the hands of the Syrian government, the US and Daesh alike.>In the wake of international controversy and news that Daesh was not fully defeated in Syria, Trump declined to give a timeline for the US troops’ withdrawal from Syria, instead saying this would take place “over a period of time”. It remains unclear whether US airstrikes will continue once the troops leave.Describing the US strikes, a Daesh fighter said: “They just like to disrupt and mess everything up […] They bombed the places where they sell gasoline, or they sell cooking oil, or where they filter the water — they bomb all these places. They bomb everything just to make your life horrible.” The fighter added: “No building is empty here,” referring to the remaining Daesh-controlled villages in Deir Ez-Zour. The Intercept said that fighters and civilians in the villages have reportedly been describing the US bombing campaign as a scorched-earth policy.
US-Backed Syrian Militants Carry Out Rare Surface-to-Surface Missile Test - What do US forces in Syria do when the Commander-in-Chief orders a "full" and "immediate" draw down of troops from the country? They conduct a rare surface-to-surface missile test with their "rebel" partners on the ground of course. An exclusive report from Middle East news site Al Masdar finds the following based on a video of the missile test uploaded to opposition social media on June 3rd, though it's unknown precisely when the test was carried out:The U.S.-backed rebel forces carried out a rare missile test in the Al-Tanf region of southeastern Homs province recently.U.S.-backed "Revolutionary Commandos" reportedly conducted this missile test in the Al-Tanf Zone that is located along the Iraqi border. Below is the short video of the rebel group carrying out the missile test in conjunction with American forces:
Syria – Turkey Fails In Idleb, Is Unwilling To Take The Northeast - The neoconservatives in the Trump administration, Secretary of State Mike Pompeo, National Security Advisor John Bolton and the Syria envoy James Jeffery, are scrambling to save their plans for Syria that President Trump disposed of when he ordered a complete retreat.Those plans were for a permanent U.S. occupation of northeast Syria, the reduction of Iranian influence within the government held parts of Syria and an eventual disposal of the Syrian government under President Assad through negotiations. These were unicorn aims that had no chance to ever be achieved.Moreover Trump had never signed off on these ideas. Back in April he had announced that he wanted U.S. troops out of Syria. He gave his staff six month to achieve that. But instead of following those orders Pompeo and Bolton tried to implement their own plans:Late last year, some of the president’s hawkish advisers drafted a memo committing the United States to a longer-term presence in Syria that included goals of an enduring defeat of the Islamic State, a political transition and the expulsion of Iran, officials said. The president has not signed the memo, which was presented to him weeks ago. In fact, Trump had warned his aides for months that he wanted out of Syria in short order....Bolton’s Iran plan never really took effect at the Pentagon, where officials were not officially tasked with any new mission in addition to the operation against the Islamic State. Military officials likewise viewed Iran’s expansion into Syria as problematic, but they were skeptical about the lack of a clear legal justification that would be required for offensive military action against Iranian-backed forces. Trump recognized that those plans were nonsense and ordered to end them. In that process he came up with a likewise unicorn idea - to hand northeast Syria to Turkey to fight the already defeated Islamic State.
Deal with Syria regime ‘inevitable’: Kurdish commander - A deal between Damascus and Syria's Kurds over their autonomous region in the country's north is "inevitable", a senior Kurdish military official said on Saturday, insisting that Kurdish forces should remain in the area. Marginalised for decades, Syria's minority Kurds carved out a de facto autonomous region across some 30 percent of the nation's territory after the devastating war broke out in 2011. Kurdish forces, backed by a US-led coalition, spearheaded the fight in Syria against the Islamic State group after the jihadists seized large parts of the country and neighbouring Iraq in 2014. But Washington's shock December announcement that it would withdraw its troops from Syria pushed the Kurds to seek a new alliance with President Bashar al-Assad's regime, amid fears of a long-expected Turkish assault against Kurdish forces. Redur Khalil, a commander in the Kurdish-led Syrian Democratic Forces alliance, told AFP that Kurdish authorities and Damascus were bound to reach a deal. "Reaching a solution between the autonomous administration and the Syrian government is inevitable because our areas are part of Syria," said Khalil. Syrian government forces deployed late last month around the key city of Manbij in Aleppo province, after Kurdish forces called for them to arrive. "Negotiations are ongoing with the government to reach a final formulation for administering the city of Manbij," Khalil told AFP, adding that talks had shown "positive signs". If that leads to a solution that "protects the rights" of Manbij residents, a similar arrangement could be applied to SDF-controlled areas of Deir Ezzor province, east of the Euphrates river, he said.
2 Americans among foreign jihadists captured by Syrian Kurds - The Kurdish-led force battling the remnants of the Islamic State group in eastern Syria said Monday it captured five foreign jihadists, including two US citizens. The two Americans, two Pakistanis and an Irishman were part of a cell planning an attack on civilians fleeing the jihadist group's last bastion, the Syrian Democratic Forces (SDF) said. The SDF has spearheaded the battle against IS in eastern Syria and is close to flushing out the jihadists from their last pocket near the Iraqi border. The force, which receives key support in the air and on the ground from the US military, said in a statement that the jihadists were captured on December 30. The SDF said its forces detected "a group of terrorists who had been preparing to attack the civilians who were trying to get out of the war zone". "An operation against the cell was carried out by our forces," it said.
NBA player to skip team’s trip to London over fear ‘lunatic’ Turkish president will have him killed -On January 17, the NBA will go international when the New York Knicks and Washington Wizards face off in a regular-season game in London, England.But one key player will not be making the trip, because he fears for his life.Enes Kanter, a center for the New York Knicks and native of Turkey, has been an outspoken critic of the government there — especially of hardline President Recep Tayyip Erdogan. Kanter now feels that his life would be in danger if he were to travel overseas.“Sadly, I’m not going because of that freaking lunatic, the Turkish president,” Kanter told ESPN on Friday. “There’s a chance that I can get killed out there. So that’s why I talked to the [Knicks’] front office. I’m not going. “It’s pretty sad that just all this stuff affects my career and basketball, because I want to be out there helping my team win. But just because of that one lunatic guy, one maniac or dictator, I can’t even go out there and just do my job. So it’s pretty sad.”
Erdogan Signals Lasting Turkey Role in Syria Amid U.S. Confusion - Turkish President Recep Tayyip Erdogan signaled a lasting role for his country’s forces in neighboring Syria as Donald Trump’s national security adviser prepares to clarify for officials in Ankara the administration’s position on a U.S. troop withdrawal that’s generated confusion. Erdogan, writing in the New York Times on Monday, laid out an agenda for Turkey’s forces in Syria that he said will include an “intensive vetting process to reunite child soldiers with their families,” oversight of the creation of local governing councils and serving as an intermediary between the U.S. and Russia in ending the eight-year-old Syrian civil war. The goal is to ensure that Islamic State doesn’t resurrect itself, he said. “A military victory against the terrorist group is a mere first step,” Erdogan wrote. “The lesson of Iraq, where this terrorist group was born, is that premature declarations of victory and the reckless actions they tend to spur create more problems than they solve.” Erdogan’s statement comes as U.S. officials add caveats and conditions to Trump’s abrupt announcement last month that he intends to withdraw American troops from the conflict. National Security Adviser John Bolton is in Turkey and will meet with officials Tuesday. He said Sunday that that American forces would remain in Syria until Islamic State is defeated, though Trump initially signaled that troops would be coming home soon. Now, it’s not clear when U.S. forces will leave and officials have repeatedly said there’s no firm timeline for withdrawal. Bolton also said that the Trump administration will demand assurances from Turkey that it won’t attack the U.S.’s Kurdish allies, who are viewed as terrorists by Erdogan’s government. #160;
Syria Withdrawal Now Depends On Turkish Guarantee Not To Attack Kurds - President Trump will only withdraw American troops from northern Syria if the Turkish government guarantees it won't attack US-backed Syrian Kurdish forces, according to national security adviser John Bolton on Sunday. According to NBC News, Trump demanded the commitment from Turkish President Recep Tayyip Erdogan as one of several conditions which need to be met before US forces mostly exit the region. "There are objectives that we want to accomplish that condition the withdrawal," said Bolton. He spoke to reporters traveling with him to Israel and Turkey as he tried to clarify Trump’s Syria withdrawal policy for allies. He’s meeting with Israeli officials Sunday and Monday, and with Turkish officials, including Erdogan, on Tuesday.Since Trump abruptly announced on Dec. 19 that all U.S. forces in Syria would exit immediately, administration officials have shifted the timing to say it would happen more slowly. Officials are now setting a series of conditions for withdrawal that must first be met, which Bolton described as “policy decisions that we need to implement.” -NBC News"This is a cause and effect mission," said Bolton. "Timetables or the timing of the withdrawal occurs as a result of the fulfillment of the conditions and the establishment of the circumstances that we want to see. And once that’s done, then you talk about a timetable." Bolton also noted that the US troop withdrawal will not be a complete exit from Syria as Trump had originally ordered. Instead, most of the American forces would be withdrawn from northern Syria - where the majority of an estimated 2,000 US troops are deployed, while a small number of troops would remain in the southern part of the country. "The primary point is we are going to withdraw from northeastern Syria," said Bolton. "So it’s going to be a different environment after we leave, there is no question about that," he added. "But there is no desire to see Iran’s influence spread that’s for sure."
Lira Slides After Erdogan Refuses To Meet Bolton For Blocking Syria Withdrawal - Turkish President Erdogan sent the lira sliding on Tuesday when he refused to meet with Trump National Security Advisor John Bolton during the latter's trip to Turkey after Bolton successfully convinced Trump to hold off on withdrawing 2,000 US troops from Syria until it had received assurances from Turkey that the Turks wouldn't attack US-backed Kurds in the region.Bolton revealed the change in direction during a Sunday interview, ahead of a planned trip abroad where he will visit Turkey and Israel to discuss the terms of the US withdrawal.Instead of meeting with Bolton, Erdogan used a prescheduled speech in parliament to criticize American proposals that the Kurdish group play a key role in Syria after the US withdraws, according to Bloomberg. Turkey, Erdogan said, has already completed preparations for how it will combat the remnants of ISIS after the US withdraws and has already drawn up plans to neutralize "all terror threats," Erdogan said Tuesday during a speech to members of his ruling AKP Party."We will very soon mobilize to eliminate terrorist organizations in Syria," he said. "If there are other terrorists who would attempt to intervene in our intervention then it is our duty to eliminate them as well," Erdogan added in a likely reference to Kurdish fighters on Turkey's border, whom Erdogan views as a threat because of their affiliation with Kurdish separatist groups within Turkey. The news sent the lira lower amid renewed tensions between the US and Turkey following hopes that the feuding NATO members might finally be setting aside their differences.
Turkey says will launch Syria attack if US delays troop pullout - Turkey will go ahead with an offensive against Syrian Kurdish fighters in Syria if the United States delays the withdrawal of its troops from the war-torn country, Turkish Foreign Minister Mevlut Cavusoglu has said. "If the [withdrawal] is put off with ridiculous excuses like Turks are massacring Kurds, which do not reflect the reality, we will implement this decision," he told NTV channel on Thursday. Cavusoglu said a military operation against the US-allied Kurdish People's Protection Units (YPG), which it has pledged to carry out in northeastern Syria, is not dependent on the pullout of US troops. "We are determined on the field and at the table ... We will decide on its timing and we will not receive permission from anyone." Turkey has long condemned the US for its military relationship with the Kurdish fighters. Ankara considers the YPG and its political wing - the Kurdish Democratic Union Party (PYD) - to be "terrorist groups" with ties to the banned Kurdistan Workers' Party (PKK) in Turkey. Last month, US President Donald Trump said he is withdrawing some 2,000 US troops from Syria in a statement that shocked many politicians in Washington as well as Western and Kurdish allies fighting alongside the US in the war-torn country. Trump's decision to withdraw troops was initially expected to be carried out swiftly, but the timetable became vague in the weeks following his announcement.. On Sunday, US National Security Adviser John Bolton had set pre-conditions for the US pullout from Syria that included Turkey guaranteeing the safety of the YPG.
Erdogan To Trump- Leave Syria Now Before We Strike - Turkey has threatened to strike the Syrian Kurdish YPG militia if the United States delays its troop withdrawal from the country, according to The Guardian. "If the [pullout] is put off with ridiculous excuses like Turks are massacring Kurds, which do not reflect the reality, we will implement this decision," said Turkish foreign minister Mevlüt Çavuşoğlu, referring to their threat to launch a military operation in Kurdish controlled Syria. Speaking with broadcaster NTV, Çavuşoğlu said it was not realistic to assume that the United States will be able to collect weapons it gave to the YPG, which Turkish President Recep Tayyip Erdoğan considers a terrorist group. Turkish officials had a tense meeting this week with Trump’s national security adviser, John Bolton, in Ankara aimed at coordinating the pullout process.Erdoğan – who has welcomed the pullout plan – accused Bolton of a “grave mistake” by demanding that Ankara provide assurances on the safety of the Kurdish fighters before Washington withdraws its troops.The US secretary of state, Mike Pompeo, who is on a regional tour, also said on Wednesday that Turkey had committed to protecting Washington’s Kurdish allies fighting Islamic State in Syria. -The GuardianThe United States has worked closely with the Syrian Kurdish People's Protection Units (YPG) militia, which Ankara views as a "terrorist offshoot" of the Kurdistan Workers' Party (PKK), reports The Guardian. The PKK has vowed to battle the Turkish state since 1984."We are determined on the field and at the table … We will decide on its timing and we will not receive permission from anyone," Çavuşoğlu said of the plan to strike, adding that various officials in the Trump administration had tried to discourage Trump from the pullout plan - creating "excuses" such as Turkey massacring Kurds, referring to Pompeo's comments.
Turkish-Backed Syrian Rebels Just Made a Deal With Al-Qaeda — After almost a solid week of losses at the hands of al-Qaeda, the Turkish-backed National Liberation Front has reached a deal with al-Qaeda on a 15-day truce. Both seem to be expecting this to lead to more fighting, and are using it to shore up their forces on their new frontier with one another. That fighting is likely to be at the important Idlib Province city of Maarat al-Numaan, as the truce was reached just as al-Qaeda was approaching the outskirts, but before the city itself could be attacked. The fighting between the two sides began early last week. According to al-Qaeda, the Nureddin al-Zimki, one of the NLF members, attacked them and killed some of their members. Over the next week, counterattacks saw al-Qaeda seize roughly 25 towns and villages. Maarat al-Numaan is on the main road connecting Aleppo and Hama, and is subsequently of considerable value to the rebels, or to the government. Though so far the Syrian government has not intervened, there is growing expectation that further al-Qaeda gains would virtually oblige them to move in and prevent al-Qaeda from getting too big.
Israel carries out overnight air strikes on Gaza - The Israeli military carried out air raids on the Gaza Strip overnight on Monday, causing damage to property, Palestinian media reported. According to Wafa, the official Palestinian news agency, Israeli warplanes fired two missiles at a site in Beit Lahiya in the northern strip. No casualties were reported. In a statement, the Israeli army said it had carried out air strikes against Hamas positions in response to a rocket being fired into Ashkelon in southern Israel. Fighter jets and helicopter gunships then raided "terrorist targets at Hamas military camps" on the Gaza Strip, the statement said. "Earlier today, an explosive device attached to multiple balloons was launched on a model plane from the Gaza Strip into Israeli territory," the statement said. A Hamas security source said one attack occurred east of Khan Younis in the southern Gaza Strip and hit an observation point for Hamas's armed wing, while the second was east of Gaza City. The security source said no injuries had been reported. The Gaza frontier has been relatively calm in recent weeks after a deal in which Israel allowed Qatar to provide millions of dollars in aid for fuel and salaries in the blockaded enclave. Since March 2018, Palestinian protesters have been demonstrating every Friday east of the strip near the Israeli border fence, calling for their right to return to their former homes now inside Israel. At least 240 Palestinians have been killed since the demonstrations began, most by Israeli fire during border clashes but also by air and tank attacks.
Palestine TV offices in Gaza ransacked, equipment destroyed (Reuters) - The Gaza offices of President Mahmoud Abbas’s official Palestine Television station were attacked and ransacked on Friday, adding to tensions between his Palestinian Authority and the Islamist Hamas movement which rules the territory. Rafat Al-Qidra, the office director, said five men broke into the premises early on Friday and destroyed cameras, editing and broadcast equipment worth nearly $150,000. “Whoever rules in Gaza must afford protection to everyone here,” Qidra told Reuters. The station broadcasts material supportive of Abbas’s Western-backed Authority, whose power base lies in the West Bank. Station officials immediately blamed Hamas for the attack. “Hamas is deeply involved in this conspiracy,” said Ahmed Assaf, chairman of the Palestininan Broadcast Corporation (PBC), speaking to the channel in the West Bank city of Ramallah. The PBC issued a statement saying the attack was a “clear reflection of the mentality of the Hamas movement and criminal gangs who believe only in their voice, and who seek to suppress freedoms”. Neither Assaf nor the PBC offered any evidence for their accusations, and Hamas officials swiftly condemned the incident. “What happened is rejected, and we condemn it,” Eyad Al-Bozom said in a statement issued by the Hamas-run Interior Ministry in Gaza. He urged the station’s officials to cooperate with investigators. There has long been antipathy between Hamas, which won the last Palestinian parliamentary elections in 2006 and is opposed to any peace negotiations with Israel, and with Abbas’s more moderate and secular Fatah faction
Canada charity used donations to fund Israeli army projects- CBC - The Canadian Broadcasting Corporation (CBC) has published an expose on a Jewish charity in Canada, which has been under investigation for using its donations to build infrastructure for the Israeli forces in violation of the country's tax rules.The Jewish National Fund (JNF) of Canada, one of the country's long-established charities, has been the subject of a Canada Revenue Agency audit after a complaint was filed in October 2017.The JNF funds numerous projects in Israel, such as reforestation efforts in areas hit by wildfires but it has also funded infrastructure projects on Israeli army, air and naval bases, the CBC, the country's public broadcaster, reported on Friday.Their activities are in violation of Canadian law which prohibits charitable funds from supporting a foreign army. CBC's article details many troubling aspects of the charity's projects which, along with funding infrastructure on Israeli military bases, it has also contributed directly to the construction of at least one hilltop settler outpost - illegal under international law, and considered illegal by Israel itself. A complaint was submitted in October 2017 with the support of Independent Jewish Voices Canada (IJV), which presented detailed evidence that JNF Canada works in violation of the Income Tax Act and contravenes Canadian foreign policy in numerous ways. According to CRA guidelines, funding for projects intended to increase the "effectiveness and efficiency" of a foreign military cannot be considered charitable and therefore should not be tax-deductible.
A cold blast from China chills industrial metals markets: Andy Home (Reuters) - (The opinions expressed here are those of the author, a columnist for Reuters.) Base metals started the new year where they left off the old one, by falling again. The London Metal Exchange index (.LMEX) slumped to a one-and-a-half year low of 2730.1 on Jan. 3. The trigger was Apple Inc’s revenue warning, not the type of news event that normally roils prices of old-economy metals such as copper, lead and zinc. But the reaction was highly instructive of what to expect in the months ahead. First and foremost, it signals that base metals continue to be beholden to the bigger financial narrative, locked into a risk-on, risk-off dance with global markets, particularly the U.S. stock market. The linkage comes in the form of U.S. President Donald Trump and the tariffs tension with China. What really spooked global markets in Apple’s rare warning was the company’s comments about disappointing sales in China, an ominous sign that a slowdown in the world’s second largest economy risks ricocheting on the world’s largest. Such fears were only exacerbated by sliding manufacturing purchasing managers’ indices in both countries. Signs of actual contraction in China bode particularly ill for metals, given the country remains the engine of growth in global usage. Metals bulls are banking on Beijing doing what it always does when the going gets tough, opening the taps and stimulating investment down the usual infrastructure and construction channels.
Is This Why China Went To The Dark Side Of The Moon? - The stated purpose of Beijing's robotic lander is to collect samples and identify what minerals are there. And while the Chang'e 4 is unlikely to find precious metals such as gold, silver or platinum - there may be something up there that could serve as a "lunar fuel station to the stars," as the South China Morning Post puts it; Helium-3The primary material on the moon is helium-3, which for now is too expensive to haul back to Earth. In theory, the non-radioactive isotope could be used as fuel for the next generations of spacecraft to explore deeper into space.Imagine driving from “NYC to LA without gas stations along the way”, said Peter Diamandis, the entrepreneur who founded the XPrize to encourage private spaceships. “If you can get the fuel from space, it reduces the cost.” -SCMPWhat's more, if China does find anything else of value on the far side of the moon, mining it would be far easier than an asteroid because of its gravity and proximity to Earth. The next step, of course, would be what every fan of author Robert Heinlein has been looking forward to since they were a kid; A moon base. The United States has been debating whether to send a mission back to the moon as soon as possible, or build a lunar base that would take quite a bit longer to orchestrate. "The US thinks in presidential terms," said University of Notre Dame lunar expert Clive Neal. "China thinks in decades." China may be testing its ability for more sophisticated missions, according to Neal of Notre Dame. That poses the question of why China chose its particular landing place, at one of the moon’s oldest and deepest craters. The answer could be simple, he said. From the far side of the moon, Chinese scientists can see farther into space because Earth’s radio waves can’t get in the way. -SCMP
China Has a Dangerous Dollar Debt Addiction -Short-term debt accounted for 62 percent of the total as of September, according to official data, meaning that $1.2 trillion will have to be rolled over this year. Just as worrying is the speed of increase: Total external debt has increased 14 percent in the past year and 35 percent since the beginning of 2017. External debt is no longer a trivial slice of China’s foreign-exchange reserves, which stood at just over $3 trillion at the end of November, little changed from two years earlier. Short-term foreign debt increased to 39 percent of reserves in September, from 26 percent in March 2016. China's foreign-exchange reserves have stagnated for the past couple of years The true picture may be more precarious. China’s external debt was estimated at between $3 trillion and $3.5 trillion by Daiwa Capital Markets in an August report. In other words, total foreign liabilities could be understated by as much as $1.5 trillion after accounting for borrowing in financial centers such as Hong Kong, New York and the Caribbean islands that isn’t included in the official tally. Circumstances aren’t moving in China’s favor. The nation’s companies rushed to borrow in dollars when there was a 3 percent to 5 percent spread between Chinese and U.S. interest rates and the yuan was expected to strengthen. Borrowing offshore was cheaper and offered the additional bonus of likely currency gains. Now, the spread in official short-term yields has shrunk to near zero and the yuan has been depreciating for most of the past year. Refinancing debt in dollars has become harder, and more risky. Beijing’s policies have exacerbated the buildup of foreign debt. To promote Xi Jinping’s Belt and Road Initiative, the president’s landmark foreign policy endeavor, China has been borrowing dollars on international markets and lending around the world for everything from Kenyan railways to Pakistani business parks.
China population to peak at 1.44 billion in 2029 - Chinese government scholars say the proportion of elderly people will steadily rise, while the country's population will decline. The dynamic could have a far-reaching impact on China's social and economic development. The China Academy of Social Sciences (CASS) published its latest edition of the "Green Book of Population and Labor," revealing that the country's population is expected to reach 1.44 billion people by 2029 and then begin an extended period of "unstoppable" decline. The report says growth in China's working population has now stagnated and fertility rates remain low. By the middle of the century, the population is expected to fall to 1.36 billion, with a decline in the workforce population of as much as 200 million. If fertility rates do not change, China's overall population could fall to 1.17 billion by 2065. With China's working population on the decline and fertility rates staying at current levels, the number of elderly people as a proportion of the general population is set to rise sharply. The trend will have a far-reaching impact on the social and economic development of the country, researchers warn. "From a theoretical point of view, the long-term population decline, especially when it is accompanied by a continuously ageing population, is bound to cause very unfavorable social and economic consequences," the report, published on Friday, said.
China Using Twitter History To Arrest, Interrogate Dissidents - China's notorious crackdown on internet activity has resulted in the arrest, imprisonment and interrogation of people posting over Twitter, according to the New York Times. A growing number of users who have been using the blocked platform through Virtual Private Networks (VPNs) have been swept up in a sharp escalation of Beijing's censorship effort, as authorities tighten their grip over Chinese citizens' online lives. There are an estimated 3.2 million Twitter users in China - or around 0.4 percent of those who use the internet. "If we give up Twitter, we are losing one of our last places to speak," said human-rights activist Wang Aizhong, who said the police told him to delete messages critical of the Chinese government. When he wouldn't, 3,000 of his tweets mysteriously disappeared. Mr. Wang refused to take down his tweets. Then, one night last month while he was reading a book, his phone buzzed with text messages from Twitter that contained backup codes to his account. An hour later, he said, 3,000 of his tweets had been deleted. He blamed government-affiliated hackers, although those who were responsible and the methods they used could not be independently confirmed. -NYTWang's experience is far from unique - as The Times reports that one Twitter user spent 15 days in a detention center, another person had their family threatened, and "a third was chained to a chair for eight hours of interrogation." Beijing's war against internet freedom reveals its vision of internet control over the user of social media - while the CHinese government has stepped up their demands that Google and Facebook take down content deemed offensive despite the fact that both companies' sites are blocked in China. What's more, Facebook and Twitter suspended the accounts of exiled Chinese billionaire Guo Wengui after he used the platforms to criticize top Chinese leaders. The companies cited user complaints and the disclosure of personal information.
How China’s worsening economic woes are shattering the dreams of its top graduate students - Tan Shiyang, a Beihang University biological science and medical engineering graduate student, should be one of the last people to have to worry about finding a decent job in China. Biotech scientists with his skills are always in short supply and his Beijing-based school is regarded as one of the best, with a reputation as China’s answer to the Massachusetts Institute of Technology. And so, when Tan received multiple job offers soon after meeting representatives from various companies at an autumn on-campus recruitment fair at Beihang, things seemed to be working out as expected. He eventually decided to accept an offer of employment as a researcher with a hi-tech firm in Shenzhen, one of China’s most vibrant cities. Assured of a job after graduation, Tan settled back and focused on enjoying his final months as a student. But in December, things took an unexpected turn. The company he had agreed to work for, Shenzhen Mindray Bio-Medical Electronics, told him that due to a change in the company’s recruitment plans, the job offer was invalidated. Mindray, China’s largest medical equipment maker, said it would give Tan 5,000 yuan (US$727), roughly a third of what would have been his salary for one month, as compensation. The change has thrown Tan’s life into chaos, coming as the “campus recruitment season” winds down and China’s economic health continues its recent downward trend. “I chose Mindray because I wanted to work as a researcher for an innovative firm, and that’s why I turned down all other job offers,” Tan said. “Now I have to start again … I had rarely thought about the economic downturn before, but now I guess I am one of its victims.” Tan is not the only graduate student caught off guard. An official jobless claims report showed employment in China has been stable, despite the months-long US-China trade war and stock market volatility. Some 12.93 million jobs were created in the first 11 months of 2018, an increase of 130,000 over the same period last year. In November, China’s surveyed jobless rate in urban areas fell to 4.8 per cent after rising to 4.9 per cent in October. However, an increase in the number of companies announcing hiring freezes and job cuts suggests that in sectors such as hi-tech and finance, the employment picture actually could be much bleaker than official statistics suggest.
In China, cash is no longer king - As more shops and restaurants in China move toward only accepting smartphone payment services such as Alipay, the elderly, visitors from overseas and people from rural areas who are unfamiliar with or lack access to these systems are running into problems paying with cash or credit cards. A cashless society has many advantages, including lower transaction costs. But it also creates a divide between those who can make cashless payments and those who cannot. The case of Hema, a futuristic supermarket chain specializing in fresh food, illustrates the problem. The stores were opened by online retail leader Alibaba Group Holding, which pitched them as a new experience that combines online and bricks-and-mortar shopping. Customers can buy fresh food at the stores or go online to have items delivered. The outlets also serve as warehouses. One catch: Hema customers could only pay for items using Alibaba's Alipay, either through smartphones or at self-checkout counters in the shops. This saved money on cashiers, but after complaints about retailers refusing cash spread, the authorities intervened and Hema had to install cash registers, Economic Daily, a Chinese news outlet, reported. In China, making purchases through smartphones and QR codes is common. According to one recent study, 98% of people with smartphones in urban areas use their devices for mobile payments. The growing frequency of these payments has led some shops to stop accepting cash altogether, partly to eliminate problems with counterfeit currency, which is rampant in China. But the shift toward electronic-only payments has drawn criticism because some people still prefer cash or have no other means of buying. In 2017, China had an estimated 772 million internet users, or 56% of its total population. But in rural areas there are still many people without access to the internet, let alone smartphones.
China's Car Sales Just Fell for First Time in Over 20 Years - The growth engine for the world’s car industry has been thrown into reverse, with China recording the first annual slump in auto sales in more than two decades -- though progress in trade talks with the U.S. and planned government incentives offer a ray of optimism. Sales in the world’s biggest market fell 6 percent to 22.7 million units last year, the China Passenger Car Association said Wednesday. The trade war and a slump in Chinese stocks have put off buyers in an industry where warning lights are already flashing worldwide. Automotive demand has been particularly hard hit by the trade tension that’s strained China’s $12.2 trillion economy -- prompting the government to prepare stimulus measures to revive sales. Chinese automakers rose Wednesday on the announcement, while Germany’s Daimler AG, BMW AG and Volkswagen AG also gained amid progress in trade talks between China and the U.S. Manufacturers that spent billions of dollars adding plants and production lines in China in the past decades are uncertain if and when growth will return. A continued aggressive expansion would risk saddling the companies with excessive capacity, while a too cautious approach would hurt their ability to take advantage of a rebound. “Pressure on automakers is mounting,” said Cui Dongshu, secretary general of the PCA. “Declining car sales may speed up the process of squeezing out the incompetent players and we may see some of them exit the market next year.”
As Trade Talks Begin, US Infuriates Beijing With Latest Navy Operation In South China Sea -As a US delegation led by senior trade officials arrived in Beijing on Monday to begin the first round of in-person talks to resolve the burgeoning US-China trade war, the US has reportedly carried out its latest 'Freedom of Navigation' operation in the South China Sea - though at least this time there wasn't a near-collision with a Chinese ship. Since President Trump's inauguration, the US has stepped up its 'Freeops' as the US Navy seeks to contain China's growing military ambitions in the Pacific. But since the trade war began, the US has demonstrated a keen sense of timing, contributing to China's decisions to cancel security conferences and reconsider coming to the table to talk on trade. But this time, the controversial maneuver seemingly doesn't bode well for the fate of a lasting US-China trade compromise. According to the Wall Street Journal, the US-guided-missile destroyer the USS McCampbell patrolled within 12 miles of the Paracel Islands in the South China Sea on Monday. In particular, it came within a few miles of three islands: Tree, Lincoln and Woody.China sent its own ship to try and deter the McCampbell, but ultimately decided to file an official complaint. According to Bloomberg, China urged the US to halt "provocative actions" in the South China Sea. "The actions by the U.S. fleet have violated Chinese law and related international laws, and undermined the peace, security and good order in the relevant waters,” Chinese Foreign Ministry spokesman Lu Kang told a briefing Monday in Beijing. "China strongly opposes the actions." The Paracels are claimed by Vietnam and Taiwan but have been controlled by China since the Communist Nation seized them from Vietnamese forces in 1974. Further alarming the US, Beijing has upgraded several military outposts in the Paracels and deployed jet fighters to at least one, according to satellite images and US officials. The ship patrol was meant to challenge excessive maritime claims by Beijing and to "preserve access to the waterways as governed by international law," according to a statement from Lt. j.g. Rachel McMarr, a spokeswoman for U.S. Pacific Fleet. China sent a vessel to warn off the American ship and has lodged a complaint with the U.S., Chinese Foreign Ministry spokesman Lu Kang said Monday at a regular press briefing in Beijing. Mr. Lu urged the U.S. to stop taking provocative action in the region and avoid disrupting trade talks under way in Beijing. China claims it has "indisputable" sovereignty over all South China Sea islands and their adjacent waters, and has often accused the US of destabilizing the region with its naval patrols.
Chinese President Xi Jinping gives army its first order of 2019: be ready for battle - Chinese President Xi Jinping on Friday ordered the People’s Liberation Army to be ready for battle as the country faces unprecedented risks and challenges. Xi’s speech was made at a meeting of top officials from the Central Military Commission (CMC), which he heads, and broadcast later on national television. “All military units must correctly understand major national security and development trends, and strengthen their sense of unexpected hardship, crisis and battle,” he said. At the meeting, Xi also signed off on the first military command of 2019, which will kick-start a year of enhanced military training and exercises. China’s armed forces must “prepare for a comprehensive military struggle from a new starting point”, he said. “Preparation for war and combat must be deepened to ensure an efficient response in times of emergency.” Xi has consistently pushed the PLA to boost its combat readiness since taking over as president and head of the CMC in late 2012, and that looks set to intensify through 2019. Earlier in the week, PLA Daily, the official newspaper of China’s military, said in an editorial that “there was no time for slacking in war preparation”.
North Korea’s Kim begins visit to China - North Korean leader Kim Jong-un has arrived in Beijing for an unannounced visit, at the invitation of Chinese President Xi Jinping. Mr Kim will be in China until 10 January with his wife Ri Sol-ju, according to state media reports. The visit comes amid reports that negotiations are under way for a second summit between Mr Kim and US President Donald Trump. The two met last June, the first such meeting for a sitting US president. Mr Kim met Mr Xi on Tuesday for about an hour, South Korean news agency Yonhap reports, citing unnamed sources, saying the pair discussed the possible US-North Korea summit. After their meeting Mr Xi and his wife Peng Liyuan hosted a dinner, Yonhap says. Speculation had grown on Monday that Mr Kim was possibly making his way to China after Yonhap reported that a North Korean train had been seen crossing the border. Dozens of security vehicles and officials blocked roads around the train station in the border town of Dandong. Hotel guests in Dandong had also not been allowed to enter rooms that faced the border, with Japanese news outlet Kyodo calling this an "apparent move to prevent the train from being seen". Both countries' media confirmed the visit on Tuesday morning. Mr Kim's distinctive green and yellow train arrived at a station in Beijing later in the day. The train, the same one used during Mr Kim's first visit to China, resembles the one used by his father Kim Jong-il during his visits to China and Russia in 2011.
WSJ investigation: China offered to bail out troubled Malaysian fund in return for deals -- SENIOR Chinese leaders offered in 2016 to help bail out a Malaysian government fund at the center of a swelling, multibillion-dollar graft scandal, according to minutes from a series of previously undisclosed meetings reviewed by The Wall Street Journal. Chinese officials told visiting Malaysians that China would use its influence to try to get the U.S. and other countries to drop their probes of allegations that allies of then-Prime Minister Najib Razak and others plundered the fund known as 1MDB, the minutes show. The Chinese also offered to bug the homes and offices of Journal reporters in Hong Kong who were investigating the fund, to learn who was leaking information to them, according to the minutes. In return, Malaysia offered lucrative stakes in railway and pipeline projects for China’s One Belt, One Road program of building infrastructure abroad. Within months, Mr. Najib—who has denied any wrongdoing in the 1MDB matter—signed $34 billion of rail, pipeline and other deals with Chinese state companies, to be funded by Chinese banks and built by Chinese workers. Mr. Najib also embarked on secret talks with China’s leadership to let Chinese navy ships dock at two Malaysian ports, say two people familiar with the discussions. Such permission would have been a significant concession to Beijing, which seeks greater influence across contested waters of the South China Sea, but it didn’t come to pass. A Journal examination of the China-Malaysia projects, based on documents and interviews with current and former Malaysian officials, offers one of the most detailed accounts to date of the political forces at work behind China’s Belt and Road program, a signature initiative of building ports, railways, roads and pipelines in some 70 countries to generate trade and business for Chinese companies.
Explosive WSJ Report Exposes China's Role In 1MDB Scandal -- In the waning months of his administration, Malaysian Prime Minister Najib Razak was desperate to stave off the bankruptcy of1MDB, the sovereign wealth fund that Razak and members of his inner circle looted (allegedly with the help of Goldman Sachs). So, he turned to an unlikely source of funding to bail out the fund - signing away rights to some of his country's most valuable resources in the process. The source? China. Employing financier Jho Low as an intermediary, Razak worked out an arrangement with the Chinese government whereby Razak's government would grant state-owned Chinese enterprises lucrative stakes in Malaysian railway and pipelines projects in exchange for $34 billion - more than enough to clear the shortfall in 1MDB, and then some.By 2016, Mr. Najib was in a bind because the fund had borrowed $13 billion it couldn’t repay. He turned to Jho Low—a Malaysian financier the U.S. Justice Department has alleged was the mastermind of a multibillion-dollar theft of 1MDB funds—to negotiate with China to resolve the crisis, according to current and former Malaysian officials.According to a report in the Wall Street Journal, Razak offered the Chinese an invaluable cherry on top of the sweetheart deal. Permission to dock Chinese Navy ships in two Malaysian ports - a "significant concession" that would push Malaysia undeniably into the orbit of Beijing.Mr. Najib also embarked on secret talks with China’s leadership to let Chinese navy ships dock at two Malaysian ports, say two people familiar with the discussions. Such permission would have been a significant concession to Beijing, which seeks greater influence across contested waters of the South China Sea, but it didn’t come to pass.The projects - and the port permissions - were swiftly incorporated into China's ambitious "One Belt, One Road" initiative - a series of infrastructure projects across Europe, Asia and Africa to fill in gaps in railway and pipeline infrastructure (and help cement China's influence across the developing world). The WSJ, which cited documents and minutes from meetings between Malaysian and Chinese officials in its report, described the projects as one of the most egregious examples of what China's critics have derided as "debt trap diplomacy" - extending credit to desperate countries in exchange for rights to key strategic resources that can be applied to BRI.
Why China is determined to connect Southeast Asia by rail -- When Japanese trading house Itochu and train maker Hitachi withdrew from a soon-to-be-decided $7 billion tender for a high-speed rail project near Bangkok, it appeared to be another victory for China and its grand plans to connect Southeast Asia with railways. But while Japan's ambitions have been stalled by disagreements about financing and other details, Beijing has managed to push ahead with construction of a separate high-speed rail line in northern Thailand. To some, the rail projects are a symbol of China's growing influence in a country where Japan had spent decades building ties. China's high-speed rail ambitions in Southeast Asia don't end in Bangkok, however. Under its planned 3,000-km pan-Asian railway network, Chinese rail lines will extend even further south, stretching through Malaysia and feeding into Singapore. Located at the tip of the Malay Peninsula, Singapore is the most developed member of the Association of Southeast Asian Nations. It also has one of the strongest relationships with Washington in the region -- giving the project added significance for China."If Beijing can court Singapore successfully and brings it into its orbit, that likely means that Singapore may decrease its security relationship with the U.S." and would give Beijing more space to operate in Southeast Asia, says Stephen Nagy, senior associate professor at International Christian University in Tokyo. It could mean that ASEAN would become more amenable to Chinese demands, such as its push for control over the South China Sea, he added. Singapore is also the gateway to the Strait of Malacca, the chokepoint for maritime traffic connecting the oil-rich Middle East to energy-hungry East Asia. The U.S. parks vessels in Singapore's ports and conducts training exercises with its navy.
China Won’t Be Taking Over - It took us 100 years to build our manufacturing capacity, they did it in under 20 (and made ours obsolete). It took us 100 years to borrow enough to get a debt-to-GDP ratio of 300%, they did it in 10. In the process they also accumulated 10 times more non-productive assets than us, idle factories, bridges to nowhere and empty cities, but they thought that would be alright, that demand would catch up with supply. And if you look at how much unproductive stuff we ourselves have gathered around us, who can blame them for thinking that? Perhaps their biggest mistake has been misreading our actual wealth situation; they didn’t see how poorly off we really are. Xiang Songzuo, “a relatively obscure economics professor at Renmin University in Beijing”, expressed some dire warnings about the Chinese economy in a December 15 speech. He didn’t get much attention, not even in the West. Not overly surprising, since both Beijing and Wall Street have a vested interest in the continuing China growth story. But with the arrival of 2019, that attention started slowly seeping through. Former associate professor of business and economics at the Peking University HSBC Business School in Shenzhen, Christopher Balding, left China 6 months ago after losing his job. At the time, he wrote: “China has reached a point where I do not feel safe being a professor and discussing even the economy, business and financial markets..”. And, noting a change that very much seems related to what is coming down the road: ”One of my biggest fears living in China has always been that I would be detained. Though I happily pointed out the absurdity of the rapidly encroaching authoritarianism, a fact which continues to elude so many experts not living in China, I tried to make sure I knew where the line was and did not cross it. There is a profound sense of relief to be leaving safely knowing others, Chinese or foreigners, who have had significantly greater difficulties than myself. There are many cases which resulted in significantly more problems for them. I know I am blessed to make it out.”
'Panic' grips Rohingya as Myanmar army battles Buddhist rebels - Frequent clashes between Myanmar security forces and Buddhist rebels in Rakhine state have spread alarm among thousands of Rohingya refugees living in no-man's-land on the country's border with Bangladesh, as concerns grow over the intensified fighting. More than 730,000 members of the mostly Muslim minority have fled Myanmar to escape a brutal military-led crackdown that started in 2017. Most of the Rohingya have taken shelter in sprawling refugee camps in neighbouring Bangladesh but some have been living in limbo on the border, unwilling to enter the settlements or return home. They are now caught on the sidelines of fighting between Myanmar troops and the Arakan Army, an armed group seeking more autonomy for western Rakhine state's Buddhist-majority population. "Heavy fighting is going on between the government troops and Arakan Army inside Myanmar," Rohingya leader Dil Mohammad told AFP news agency. "The situation is very tense," he said, adding that the security build-up and daily gunfire had created "panic". Myanmar soldiers last week set up security camps and bunkers along the border after fighting saw 13 police killed. Some of the fortifications are directly adjacent to a border fence running alongside a stream and overlooking shacks erected by an estimated 4,500 displaced Rohingya living in the narrow strip of land. Refugee community leader Nur Alam said gunfire could frequently be heard after dark on the other side of the border. "Every night it is close by. The Myanmar border guard have set up 10 new posts near our camp. It's very intimidating," he told AFP.
An Indian Company Announced 63,000 Job Openings... 19 Million People Applied - In February, the railway system in India announced that it was recruiting for some of the most basic and menial positions in its organizational hierarchy. It was looking for positions like helper, cleaner, track maintainer and rail switchman. It announced 63,000 vacant jobs it was trying to fill. It got 19 million applicants. Those applicants included people like Anil Gujjar, who traveled to India's capital in search of a job. Gujjar was the first person in his family to attend college, but wound up having to compete with millions of other men like him, almost all of which were college students or graduates. Some even had postgraduate degrees. The flock to these jobs indicates a bigger problem in India: the country has a fast growing economy, but isn’t generating enough jobs for its educated young populace. A Washington Post article estimates that the number of people in India between age of 15 and 34 is expected to hit 480 million by the year 2021. They have higher literacy levels and are staying in school longer than any other previous generation. The surge of youths could be an immense opportunity for the country, if it can find a way to put them to work. But the employment trends in the country are not optimistic. An analysis performed by Azim Premji University shows that unemployment between 2011 and 2016 in nearly all Indian states was rising. The jobless rates for younger people and those with higher education also increased sharply. For instance, for college graduates, it grew from 4.1% to 8.4%. The feat of staving off jobseekers has become a major political task for Prime Minister Modi, who is seeking reelection this year. He rose to power promising job creation, but all of his attempts to increase domestic manufacturing and entrepreneurship have yet to help the employment cause. Further, Modi‘s decision to invalidate most of India's banknotes in 2016 resulted in about 3 million jobs being lost over the course of the first four months of 2017. The Center for Monitoring Indian Economy, a research firm in Mumbai, found that the Indian labor force also shrank between 2017 and 2018.
India’s lower house passes citizenship bill that excludes Muslims - India's lower house of parliament has approved a bill that would grant residency and citizenship rights to non-Muslim immigrants, sparking protests that brought the country's populous northeast to a near standstill. The legislation, which still needs the approval of the upper house, seeks to grant rights to Hindus, Jains, Parsis and several other non-Muslim religious groups who migrated without documents from Bangladesh, Pakistan and Afghanistan. "They have no place to go except India," Home Minister Rajnath Singh told parliament on Tuesday. "The beneficiaries of the bill can reside in any state of the country." As Assam counts its citizens, Muslims fear they may be left outCritics have called the proposal, contained in the Citizenship Amendment Bill, 2019, blatantly anti-Muslim and an attempt by Prime Minister Narendra Modi's Hindu nationalist Bharatiya Janata Party (BJP) to boost its Hindu voter base ahead of a general election due by May. The bill sparked a second day of protests in the northeastern state of Assam, where nearly four million people, accused of being foreigners, were effectively stripped of their citizenship last year. Protesters there are angry not because the bill excludes Muslims, but because it would grant citizenship to undocumented Hindus who failed to prove their citizenship and hence were excluded from the draft National Register of Citizens (NRC) published last July.
India plans job quotas for upper caste poor as election nears - Months ahead of crucial general elections, India's government plans to reserve 10 percent of government jobs for the poor, including the country's historically privileged upper castes. The Bharatiya Janata Party-led (BJP-led) government on Tuesday moved a constitution amendment bill in the lower house of parliament, seeking an increase in the cap on reservations from 50 percent to 60 percent. India's system of reservation or quota - its version of affirmative action - guarantees the historically-disadvantaged lower castes and tribes "reserved" places in government jobs, educational institutions and even seats in parliament and state assemblies. The amendment bill must be backed by a two-thirds majority in both the houses of parliament. The government does not have a majority in the upper house, although it is not immediately clear how rival political parties would vote on the bill. The new reservation policy, if it comes into effect, would aid households with an annual income of less than $11,000, the Press Trust of India news agency reported. In 2017, India's average income was $1,939, according to the World Bank.
150 million Indians to go on strike against Modi’s “anti-labour” policies - Daily life across India might come to a screeching halt as nearly 150 million employees across banks, public transport, factories, and government companies go on a two-day strike tomorrow (Jan. 08). The strike has been called by 10 trade unions across the country against what they believe are anti-labour policies of prime minister Narendra Modi’s government. Employees from the power, steel, auto, and financial services sector will participate in this “historic event.” The strike will also be joined by farmers, who have been protesting against the agrarian crisis in the country for several months now. “The government has been pursuing anti-economic and anti-labour policies which has forced us to go on this strike,” CH Venkatachalam, general secretary of the All India Banks Employees’ Association (AIBEA), one of the trade unions that is participating in the protest, told Quartz. “For instance, prices of commodities have been going up and even the essential goods are not available in fair price shops and the government doesn’t seem to be doing anything about it.”Founded in 1946, AIBEA is India’s oldest and largest bank employees’ union with around 500,000 members.Another reason for the protest is the fact that India is not creating enough jobs. Ahead of the last general elections, Modi’s Bharatiya Janata Party (BJP) had promised to create nearly 10 million jobs every year. Despite these tall claims, the employment scenario in the country is so dismal that in the last financial year the total number of employees in India came down, instead of going up. Another sore point for the trade unions is that a large number of public sector companies are struggling, forcing the government to divest its stake in them or merge them with healthier ones. For instance, in November 2018, the cabinet approved the stake sale of government-owned Dredging Corporation of India to a consortium of four ports.
Millions of Indian workers hold two-day general strike against Modi government -- Over 180 million workers began a two-day general strike across India yesterday in protest against Prime Minister Narendra Modi’s big business assault on the working class. Tens of thousands of workers defied threats of sacking and pay cut by state governments to join the national walkout. The huge strike, which is continuing today, is a powerful indication of the mass opposition to Modi’s Hindu-supremacist Bharatiya Janatha Party (BJP)-led government and its escalating attack on jobs, working conditions and basic democratic rights. While millions of workers demonstrated their readiness to fight the Modi government, the unions, and the parties that control them, called the walkout to divert the widespread discontent and anger into the election of an alternate big business government, most likely Congress Party led, in the forthcoming April-May national ballot. The Stalinist Communist Party of India (Marxist) or CPM and the Communist Party of India or CPI and their respective affiliated unions—the Centre of Indian Trade Unions (CITU) and the All India Trade Union Congress (AITUC)—played a key role in the strike. The CITU and AITUC joined forces with the Congress-led Indian National Trade Union Congress and the Labour Progressive Front (LPF), which is affiliated with the right-wing Tamil communalist DMK (Dravida Munnetra Kazhagam), to organise the walkout. The Stalinists, who provided “left” and “pro-worker” credentials to these bourgeois parties, have no fundamental differences with Modi’s economic measures and are committed to India’s close military-strategic partnership with the US. Workers from key economic sectors—banks, insurance, transport, postal, anganwadi (child care centres), mines and various government offices—joined yesterday’s strike.
Here’s What a Real Strike Looks Like: 150 Million Say No to Despotism in India - Indian cities never go silent. Sound is a constant feature—the horns of cars, the chirping of birds, the cries of hawkers, the steady hum of a motorcycle engine. On Tuesday, India is on strike. It is likely that about 150 million workers will stay away from their workplaces. Trade unions of the Left have called for the strike, a general strike in a country exhausted by rising inequality and a mood of dissatisfaction. The streets of Kerala—a state governed by the Left Democratic Front—are not quiet. Cars and motorcycles go their way. But the roads are quieter. Public transport is off the road, because the transport unions are behind the strike. Thiruvananthapuram sounds like it did about 20 years ago, when traffic was lighter and when the city was calmer. But there is nothing calm in the atmosphere. Workers are angry. The government in Delhi continues to betray them. Strikes of this scale are not unusual in India. The largest recorded strike in world history took place in India in 2016, when 180 million workers protested the government of Prime Minister Narendra Modi. The demands of this strike are—as usual—many, but they center around the deterioration of the livelihood of workers, around the demise of work itself for many people and around the political attack on unions. Modi’s government is eager to amend the trade unions laws. Tapan Sen, the leader of the Centre of Indian Trade Unions (CITU), said that the new trade union laws would essentially lead to the enslavement of Indian workers. These are strong words. But they are not unbelievable.
Is India Really 96% Open Defecation Free- The Census 2011 told us only 32% of India’s rural households had toilets. Other studies showed that a fewer number of those households actually used those toilets. Under the Narendra Modi government’s Swachh Bharat Mission (SBM), much has changed. Firstly, commitment has come from the highest level of government, especially the prime minister. By all accounts, the secretary in charge of SBM is a remarkably driven man. Secondly, under SBM, for the first time, the government is focusing on changing behaviour on a large scale. In fact, India is implementing the world’s largest collective behaviour movement for rural sanitation. Third, there is new focus on verification of ODF (open defecation free) status by monitoring toilet use. Earlier it was counting the number of toilets built. SBM guidelines specifically state that the focus has to now be on counting ODF villages. However, the two have gone together (as we show below). Fourth, money has been allocated on a scale hitherto unheard of to hire the staff to mobilise communities around sanitation. Half a million Swachhagrahis have been deployed in villages and districts (who, of course, need more support and training). The speed with which toilets are being constructed has indeed gained momentum. Over 4.5 million toilets had been constructed between October 2014 and October 2017. This then jumped to 9.12 million by December 30 2018, and the number rises every minute as you watch the clicker on the ministry website. By October 2017, more than 2,43,000 (of India’s 6,50,000) villages, 201 out of 677 districts and five states had been declared ODF. This then reached an incredible 5,39,000 villages, 580 districts and 27 states and UTs by December 30, 2018, in just 15 months. The speed of construction is nothing short of breakneck. At this point, the natural question to ask is if whether these claims are credible. We have only the government’s administrative records to go by. Rarely, if ever, in India are administrative records reliable, especially if the ministry driving the programme is closely measuring output and is required to “show results”.
Evacuated Opal Tower residents in Australia express anger and dismay - Residents of Opal Tower in Sydney continue to live in hotels and other accommodation after being evacuated following the discovery of large broken concrete panels in the building. Some 51 of the 392 apartments were declared unsafe on Christmas Eve, and the entire complex emptied on December 27. A 10-day evacuation was extended by a week to this Friday when an initial engineering report on the cause of the structural fault is due to be released. On the “Opal Tower Sydney Residents” Facebook group, renters have reported that some landlords are insisting that they continue to pay rent and refusing to allow leases to be broken. Under the Residential Tenancy Act 2010, tenants are only allowed to terminate a lease if the property is deemed uninhabitable. In some cases, landlords have agreed. One resident commented: “With the advise [sic] of fair trading, I broke my lease with immediate effect and without penalty.” The person stated that they had been told they would still get access to the food and accommodation allowances provided by the builder to evacuated residents.
Kenya will start teaching Chinese to elementary school students from 2020 -- Kenya will teach Mandarin in classrooms in a bid to improve job competitiveness and facilitate better trade and connection with China.The country’s curriculum development institute (KICD) has said the design and scope of the mandarin syllabus have been completed and will be rolled in out in 2020. Primary school pupils from grade four (aged 10) and onwards will be able to take the course, the head of the agency Julius Jwan told Xinhua news agency. Jwan said the language is being introduced given Mandarin’s growing global rise, and the deepening political and economic connections between Kenya and China. “The place of China in the world economy has also grown to be so strong that Kenya stands to benefit if its citizens can understand Mandarin,” Jwan noted. Kenya follows in the footsteps of South Africa which began teaching the language in schools in 2014 and Uganda which is planning mandatory Mandarin lessons for high school students.
US Quietly Deploys Troops to Gabon Amid Fears of Unrest in Congo — While the election in Congo was relatively quiet, the US is expecting that there will be protests when the results are announced. The anticipation is enough that President Trump has ordered to send troops to neighboring Gabon, and is warning the Congolese not to protest.Rep. Nancy Pelosi (D-CA) is reporting that the US sent about 80 troops and “appropriate combat equipment” to Gabon for the fight, President Trump has said more troops will deploy as needed to Gabon.The election is between the ruling party’s candidate Ramazani Shadary, and opposition candidate Martin Fayulu, who is backed by the Catholic Church. The Catholics appear to be anticipating a Fayulu win, and have warned of an “uprising” if an untrue result is released.Shadary is backed by long-standing dictator Joseph Kabula’s family, and has accused the Catholics of being “irresponsible and anarchist” in their attitude toward the election. Though results were expected on Sunday, officials say only 53% of the polling stations have been counted. The church insisted on Thursday that the results are a clear win for their side. There is no longer any timeline for a result.
How the US Spent Billions to Change the Outcome of Elections Around the World - (BAR) — The U.S. military state overthrows democratically-elected governments that it deems to be a threat to corporate interests. “There is plenty of evidence that the United States is the most depraved and dangerous “meddler” in the affairs of other nations that history has ever known.” Dan Kovalik is a labor and human rights lawyer, but most of all he is an anti-imperialist and an author of three books. Kovalik’s first two books tackled the specific US war drives against Russia and Iran. His third installment, The Plot to Control the World: How the US Spent Billions to Change the Outcome of Elections Around the World, addresses the broad scope of US election meddling abroad. The book provides much needed political and ideological life support to an anti-war movement in the U.S that has been rendered nearly invisible to the naked eye. The Plot to Control the World is as detailed in its critique of U.S. imperialism as it is concise. In just over 160 pages, Kovalik manages to analyze the various ways that the U.S. political and military apparatus interferes in the affairs of nations abroad to achieve global hegemony. He wastes no time in exposing the devastating lie that is American exceptionalism, beginning appropriately with the U.S. imperialist occupations of Haiti and the Philippines at the end of the 19th century and beginning of the 20th. The U.S. would murder millions of Filipinos and send both nations into a spiral of violence, instability, and poverty that continues to this day. As Kovalik explains regarding Haiti, “While the specific, claimed justifications for [U.S.] intervention changed over time- e.g., opposing the end of slavery, enforcing the Monroe Doctrine, fighting Communism, fighting drugs, restoring law and order — the fact is that the interventions never stopped and the results for the Haitian people have been invariably disastrous.” “Kovalik wastes no time in exposing the devastating lie that is American exceptionalism.” US expansionism has relied upon the ideology of American exceptionalism to silence criticism and weaken anti-war forces in the United States. American exceptionalism claims that the U.S. is a force for good in the world and completely justified in its wars of conquest draped in the cover of spreading “democracy and freedom” around the world. Kovalik challenges American exceptionalism by showing readers just how much damage that US expansionism and militarism has caused for nations and peoples in every region of the planet.Russia, Honduras, Guatemala, the Democratic Republic of the Congo, Vietnam and many other nations have seen their societies devastated by U.S. “election meddling.” In Honduras, for example, a U.S.-backed coup of left-wing President Manuel Zelaya in 2009 made the nation one of the most dangerous places in the world to be a journalist, indigenous person, or trade-union/environmental activist. Thousands of Hondurans have been displaced, disappeared, or assassinated since the coup.
With US on sidelines, China drives Latin America mobile tech boom - As the age of US dominant influence in Latin America recedes further into the past, new reporting this week sheds light on how China’s role in the region is taking shape. Chinese foreign direct investment into Latin America has gone through the roof over the past 10 years, with an increasing focus on telecommunications, and the region, in turn, is looking to China as an example for its own future. That is the story told by some Latin American entrepreneurs who see America’s influence diminishing. “China’s influence has been very important. Latin America is more similar to China than to the US,” Felipe Henriquez, the Chilean co-founder of an online group buying website, was quoted as saying in an article by Bloomberg on Tuesday. “When you go to China, you see what’s going to happen in Latin America in five more years. Today, we look at China. We look at Meituan, at Alibaba and Tencent, to see what we can do in the future.” According to a recent report from the United Nations Economic Commission for Latin America and the Caribbean, Chinese companies invested some US$18 billion in Latin America in 2017, more than from any other country. “Right now, we’re at the inflection point,” Nathan Lustig, a partner at Magma Partners who helped launch a China-Latin America accelerator last year, was quoted as saying. “There’s a massive trend of copying from China because they solved the same problems ten years ago Latin America is dealing with today: the unbanked, no-credit scores, no phone-to-suddenly having smartphones.”
Brazil’s Bolsonaro Unveils Privatization Plan While Slashing Wages for Poor, Taxes for Rich — Ending his first week in office by quickly putting into action the far-right agenda he promoted during his campaign, Brazilian President Jair Bolsonaro on Thursday unveiled economic proposals that critics say will worsen inequality across Brazil, putting corporate profits above the well-being of middle- and lower-class families. Privatization of airports and seaports, tax cuts for the rich, pension cuts, and a minimum wage set lower than Bolsonaro’s predecessor had planned were among the economic reforms the new president has in store for the country, as it moves toward what the new right-wing government calls a “minimal state.” Finance Minister Paulo Guedes indicated that the administration has plans to privatize Eletrobras, the government-run power firm, while Bolsonaro took to Twitter on Wednesday to announce his plan to privatize 12 of the country’s airports and four seaports, claiming Brazil is burdened by “hundreds of bureaucratic governing bodies” and that the move will make available $1.85 billion in private investments. The president eventually plans to privatize 44 airports, according to the Center for Aviation, a move that could end operations for Infraero, the country’s national aviation authority. Guedes also expressed the need for “tax simplification and reduction”—a sign that the administration will worsen the already-regressive tax code which has slashed taxes for the rich while leaving low-income families paying more each year, proportionally, than rich households.
"Complete Chaos" As Brazil's Gangs Go Ballistic Over Bolsonaro Crackdown - Brazil has been swept with a rash of violence as gangs react to new President Jair Bolsonaro's crackdown on crime - which includes military takeovers of Brazilian cities and shoot-to-kill orders carried out by teams of sharpshooters. Five hundreds national guard troops have been deployed to the north-eastern town of Fortaleza in the state of Ceará, after authorities have been overwhelmed by more than a week of violence which saw more than 160 attacks, reports the Guardian. Security forces say three rival drug gangs have come together to carry out more than 160 attacks in retaliation for a proposal to end the practice of separating gang factions inside Brazil’s prisons. Buses, mail trucks and cars have been torched. Police stations, city government buildings and banks have been attacked with petrol bombs and explosives. On Sunday, criminals blew up a telephone exchange, leaving 12 cities without mobile service. Other explosions have damaged a freeway overpass and a bridge. -GuardianThere have been 148 arrests linked to the attacks, while at least 20 prisoners suspected of ordering the attacks haver been transferred from state to federal prisons - where Bolsonaro's administration says it won't back down on its plan to combat gang activity.
Venezuela’s congress names new leader, who vows to battle President Nicolas Maduro - Venezuela's opposition-controlled congress opened its first session of the year Saturday, installing a fresh-faced leader who struck a defiant tone and vowed to take up the battle against socialist President Nicolas Maduro. Juan Guaido, 35, assumes the presidency of a National Assembly stripped of power by Maduro, whose government is blamed for leading the once-wealthy oil nation into a historic political and humanitarian crisis. Speaking to legislators, Guaido named several opposition politicians and opponents of Maduro's government who have been jailed, driven into exile or killed. He said desperation has forced masses of citizens to flee abroad looking for work. "We are under an oppressive system," he said. "It's not just that — it is miserable." Tall and youthful, Guaido represents the next generation of Venezuelan political opposition, taking up the assembly's leadership following 74-year-old Omar Barboza. Guaido is an industrial engineer and former student leader from the same political party as Leopoldo Lopez, Venezuela's most popular opposition leader, who is under house arrest. Government opponents consider him a political prisoner. Guaido called Maduro a dictator whose legitimacy has run out. Venezuela is living a "dark but transitional" moment of its history, he said, adding that among its first acts congress will create a transitional body to restore constitutional order, but he offered no details. He addressed a hall filled only with opposition lawmakers as the government loyalists have long boycotted any sessions, saying the National Assembly has itself overstepped its authority. However, roughly 20 foreign diplomats from the United States, Canada, Japan, Italy and Germany attended the assembly's inaugural session in a show of solidarity. It opened days before Maduro's inauguration to a second, six-year term widely condemned as illegitimate after he declared victory in the May 20 election that many foreign powers considered a sham.
China Accuses Canadian Elites Of White Supremacy Over Prosecution Of Huawei CFO - Justin Trudeau has already been accused of being a misogynist. Now his entire government is being accused of White Supremacy by the Chinese ambassador to Ottawa over its insistence that China release two Canadians - including a former diplomat who were detained by Chinese authorities last month, despite China's insistence that both men "without a doubt" posed a threat to Chinese national security. In the op-ed, published by Ottawa's the Hill Times newspaper, ambassador Lu Shaye lashed out at Canadian "elites [who] completely dismissed China’s law and presumptuously urged China to immediately release their citizens." He also accused Canada of enforcing a double standard by detaining Huawei CFO Meng Wanzhou despite her not having committed a violation of Canadian law. Canadians have shown intense concern over the wellbeing of their citizens, but Lu accused them of behaving thoughtlessly and cruelly toward Meng.However, on the prior groundless detention of Chinese citizen Meng Wanzhou by Canada at the behest of the United States, these same people made utterly different comments. They insisted that Canada’s detention of a Chinese citizen who was transferring planes at the airport was "acting in accordance with law," though Meng has not been charged with any violation of Canadian law.It’s understandable that these Canadians are concerned about their own citizens. But have they shown any concern or sympathy for Meng after she was illegally detained and deprived of freedom?Without violating any Canadian law, Meng was arrested last month and put in handcuffs just as she was changing planes at the Vancouver International Airport. It seems that, to some people, only Canadian citizens shall be treated in a humanitarian manner and their freedom deemed valuable, while Chinese people do not deserve that. Lu pointed out the hypocrisy in Canadian officials' insistence that Meng's detention was just because Canada is a country that respects the "rule of law," implying that China isn't.
Canada wants to welcome more than 1 million new immigrants in the next three years The Canadian Parliament has announced plans to add more than one million new permanent residents in the next three years. That's nearly one percent of the country's population each year. Canada welcomed more than 286,000 permanent residents in 2017 and projects that number could reach 350,000 this year. And 360,000 in 2020. And 370,000 in 2021. That's a lot of immigrants, eh? "Thanks in great part to the newcomers we have welcomed throughout our history, Canada has developed into the strong and vibrant country we all enjoy," said Ahmed Hussen, Canada's minister of Immigration, Refugees and Citizenship (IRCC). Hussen, himself an immigrant from Somalia, said the influx will help offset Canada's aging population and declining birth rate while growing its labor force. Canada's friendly stance towards new residents comes as many other Western nations, including the United States, are adopting more restrictive immigration policies. Canada is especially dedicated to offering protection to refugees. The United Nations Refugee Agency reported unprecedented levels of refugees in 2017, with the number of forcibly displaced people reaching 68.5 million. IRCC has pledged $5.6 million to support global resettlement initiatives.
Canada spawns its own yellow vest protests – with extra rightwing populism --Amid growing concerns over Canada’s ailing domestic oil market, protests have erupted in western parts of the country, where some demonstrators have donned yellow reflective vests inspired by France’s gilets jaunes.Like their French counterparts, the protesters have organized on Facebook pages, and focused their fury on a federal carbon tax, but their grievances also include stalled pipeline projects, oil sector layoffs, and – for a small minority – the government’s liberal asylum policies. Canada, the world’s fourth-largest oil exporter, has been hit hard by a recent slump in oil prices, and a lack of pipelines to move its crude to markets. Some companies have begun to lay workers off, prompting fears of potentially widespread job losses in the oil-rich province of Alberta, where at least 40,000 jobs were lost during the last oil market crash of 2014.On Wednesday, a convoy of more than 1,000 heavy trucks in Alberta rolled through the town of Nisku, in a show of support for the beleaguered energy sector.“We are in dire need. Many people that are in the industry have lost their homes, lost their families,” “The kids feel the anxiety. There’s the roundtable discussions that you have with your wife over bills about what you can pay and what you can’t pay. It’s tough.”While global crude oil prices rallied over the last year, the cost of Canadian crude has remained low because of oversupply. The Alberta government has said the gap in prices is costing the Canadian economy C$80m ($59m) each day in lost revenues. This week, the federal government announced a C$1.6bn bailout for oil and gas companies, and the province’s premier, Rachel Notley, has launched a series of measures to contain the crisis, purchasing rail cars to move oil to markets and ordering a rare cut in oil production to rein in oversupply. But for workers in the resource-rich province, the moves are too little, too late.
Jim Yong Kim steps down as President of World Bank - World Bank President, Jim Yong Kim has made the surprise announcement that he is stepping down after six years in the post. His resignation will take effect from 1 February. Mr Kim, 59, was not due to leave until 2022, after he was re-elected for a second five-year term in 2017. He will "join a firm and focus on increasing infrastructure investments in developing countries", the World Bank said. In a statement, Mr Kim said: "It has been a great honour to serve as President of this remarkable institution, full of passionate individuals dedicated to the mission of ending extreme poverty in our lifetime". No reason was given for his unexpected resignation. Kristalina Georgieva, the World Bank's chief executive officer, will assume the role of interim president.
IMF Warns World Dangerously Unprepared For Upcoming Global Recession - In the starkest warning yet about the upcoming global recession, which some believe will hit in late 2019 or 2020 at the latest, the IMF warned that the leaders of the world’s largest countries are "dangerously unprepared" for the consequences of a serious global slowdown. The IMF's chief concern: much of the ammunition to fight a slowdown has been exhausted and governments will find it hard to use fiscal or monetary measures to offset the next recession, while the system of cross-border support mechanisms — such as central bank swap lines — has been undermined, warned David Lipton, first deputy managing director of the IMF. “The next recession is somewhere over the horizon, and we are less prepared to deal with that than we should be . . . [and] less prepared than in the last [crisis in 2008],” Lipton told the Financial Times during the annual meeting of the American Economic Association. “Given this, countries should be paying attention to keeping their economy on a level trajectory, building buffers and not fighting with each other.” While the IMF projected solid, 3.7% growth in the global economy in 2019 in its most recent, October, forecasts, with the IMF set to release updated forecasts later this month, Lipton admitted that the growth outlook is being undermined by trade tensions, policy flaws and weakness in Asia. “China is clearly slowing down — we think China’s growth has to slow, but keeping it from slowing in a dangerous way is an important objective,” he said, noting that a downshift would be “material very broadly, not just in Asia.” Countering the IMF's gloom, at the same conference, White House economic advisor Larry Kudlow, said that “there’s no recession in sight.” He urged economists to ignore the swings on Wall Street, even as many traders and some leading economists have pointed out that the new gloomy investor “narrative” could become self-reinforcing amid a renewed debate if the market leads the economy or vice versa. "Suddenly, the markets are reacting as if there’s a crisis of interest rate increases,” argued Yale professor Robert Shiller. He pointed out that, although the Fed had been raising rates for several years, investors were only reacting to this now: "This doesn’t look rational,” he says, drawing parallels with the 1920s in terms of the sudden shift in psychology. “[Then] the earnings were high, the economy was moving well, but suddenly it crashed — and again it was talk, I think. There was a new narrative that developed in 1929, just as there is a new narrative developing today.”
Swiss National Bank Suffers $15 Billion Loss On 2018 Market Rout - In the third quarter of 2018, the hedge fund known as the Swiss National Bank did something it had not done in years: it sold stocks. As we showed in November, the overall value of the SNB's US listed long holdings rose by over $2 billion to $90 billion, but all of this was due to the price a ppreciation as the central bank sold around $7bn of equities in Q3. This compares to purchases during 1H18 of around $6bn. Alas, it did not sell enough, and as the next chart showed, some of the SNB's top holdings would be the stocks that ended up getting hammered the most in the fourth quarter.Why "alas"? Because the central bank which is one of the biggest investors in US stocks (in order to depress the value of the Swiss Franc) reported today that it had ran upa loss of 15 billion francs ($15.3 billion) in 2018 as a result of the global stock market rout hitting its equity holdings, resulting in the biggest annual loss since the 2015 franc revaluation and the third biggest loss on record. As is well known, equities - Apple, Microsoft, Amazon, Alphabet, and Facebook are 5 of the SNB's top 6 positions - make up 20% of the SNB’s massive holdings of foreign currencies. That was a problem in a quarter when U.S. and European stock benchmarks tumbled, while the franc gained against most of its G-10 peers, leading to a 16 billion-franc loss on that portfolio alone. And, as Bloomberg notes, with a mountain of foreign exchange which at 729 billion francs exceeds the size of Switzerland economy, the central bank is at risk of big swings when markets get turbulent. The good news - for the hedge fund which can just print more money any time it needs it - is that any profit or loss has no bearing on monetary policy, which is determined more by the strength of the franc. Of course, that the Swiss central bank is the world's largest risk-free hedge fund is only one part of its mystique: unusually among central banks, the SNB not only trades as a public company, but its shareholders receive a dividend (and face no downside when it suffers a loss). Ironically, in a time when everyone has been obssessing with the rise and fall of bitcoin, few have noted that the stock of the Swiss National Bank rose almost 700% from the start of 2016 through its April 4 all time high of CHF 8600.
Ford To Cut Thousands Of European Jobs, Close Factories In Major Restructuring - In the latest confirmation that global auto sales are sliding and that US automakers are struggling to compete in the hypercompetitive European car market - something that President Trump might interpret as another reason to press ahead with auto tariffs presently being studied by the Commerce Department - Ford has announced a massive 'restructuring' of its European operations, following in the footsteps of GM's much broader restructuring, that will entail thousands of job cuts and possibly factory closures. The cuts are hardly a surprise after the carmaker's foreign profits have plunged over the past two years thanks in part to exchange rate-related losses spurred by the strength of the dollar, as well as poor sales of its diesel models. According to the BBC, which broke the story, Ford will lay off 'thousands' of workers and contemplate factory closures. Ford's decision to curtail its European operations comes two years after GM sold its European subsidiary to French carmaker Peugeot. The FT reported that Ford employs 53,000 people in Europe (13,000 in the UK alone) across 15 factories, including two engines plants in the UK at Bridgend and Dagenham. The Bridgend plant in particular could be in danger because Ford lost a major contract to build engines for Jaguar Land Rover in 2020. Meanwhile, Ford's Dunton Technical Centre in Essex could potentially benefit from new investment in the commercial vehicles Globally, the automaker is targeting $14 billion in cuts outside North America to try and revive its international business. Analysts have projected that the company could shed up to 24,000 of its international employees as it struggles to reach its 8% profitability target by 2020 (which would put Ford back ahead of Fiat Chrysler). In the region, Ford is targeting profitability of 6% after the restructuring (something it has never before achieved).
Shocking German Industrial Production Plunge Stokes Recession Fears In Europe's Largest Economy - Mere hours after German Economy Minister Peter Altmaier assured the German public that the country's economy will continue to expand despite a recent raft of discouraging economic data, official data - unlike the US, Germany's government is open and economic data continue to be reported - showed German industrial activity plunged the most since 2009, confirming a weak factory orders print from Monday and sparking fresh fears that Europe's largest economy may have entered a recession during Q4 just as Mario Draghi was preparing to end the ECB's purchases of government bonds. According to Bloomberg, industrial production fell for a third month in November (-1.9% m/m, and -4.9% y/y) with weakness in everything from consumer goods to energy. In another warning sign for the bloc, the data was released alongside a eurozone-wide sentiment reading which showed that economic confidence had slumped late last year. The dismal IP reading confirmed a just as ugly German factory orders print from Monday which tumbled far more than expected in November. Orders slid 1% from October, and posted a year-on-year decline of 4.3%, the biggest drop in more than six years The data raise the possibility that while European Central Bank President Mario Draghi was assuring investors in December that the Continent's economy had enough momentum to justify tapering the central bank's asset purchases, its largest constituent may have been sliding into a recession.For what it's worth, Germany’s central bank said Tuesday it’s "looking through the volatility of monthly economic data" and wouldn't comment on individual reports. The bank has been hoping for a rebound from the German economy's Q3 contraction, arguing that the shrinkage was due to temporary factors like new auto emissions rules.One economist said that even if the German economy manages to avoid a recession, it's looking likely that industrial output probably contracted in the fourth quarter."The latest data, even assuming a bounce back in December, mean industrial output probably contracted in the fourth quarter. The decline is big enough to have a meaningful impact on GDP growth, and creates a risk that the economy shrank again." But in a reflection of the bad-news-is-good-news dynamic that reasserted itself in the US on Monday, German stocks rallied on the news, while German bund yields climbed but soon pared their move.
Deutsche Bank Prosecutors Seize Massive Client List During 'Panama Papers' Raid - Prosecutors in Frankfurt seized a list of more than 900 Deutsche Bank clients in a tax evasion case known commonly as the "Panama Papers," a set of leaked documents which resulted in a raid at the German bank's headquarters in November, according to Bloomberg. The list is said to contain names of individuals and entities mostly located outside Germany, while the raid was focused on the role of a former Deutsche Bank wealth management entity located in the British Virgin Islands.The Panama Papers showed that Deutsche Bank employees may have helped customers set up off-shore companies in tax havens, prosecutors said at the time. Those companies were allegedly involved in tax evasion, they said, adding that 900 clients were allegedly served via the unit. Prosecutors also seized extensive data on paper and electronically, the people familiar with the matter said.The footage of rows of police cars parked in front of the bank’s two downtown Frankfurt towers in November fueled concerns about potentially expensive legal risks and sent the share price to an all-time low. –Bloomberg Deutsche Bank CEO Christian Sweing said he was surprised at the raid, saying in December that he thought the case was considered closed, having addressed it in "close cooperation with supervising authorities" in 2016 when the Panama Papers were leaked.
After Introducing Mass Migration To Europe, Germany Now Bribing Foreigners To Leave - The German government has mounted an aggressive campaign to encourage illegal migrants to leave - bribing them with free rent for a year in their home countries. "Your country. Your future. Now!” read billboards in seven languages, plastered in nearly 2,500 locations across 80 German cities, reports the National Post. A series of flags corresponding with the top-destinations – Egypt, Turkey, Afghanistan, Eritrea and Russia – shapes a zigzagging road to a fictional horizon.The “ReturningfromGermany” ad campaign is the latest tactic by the German government to boost departures and deter migration, in a reversal of Angela Merkel’s controversial welcoming policy of 2015 at the height of the Syrian refugee crisis. The campaign is the brainchild of interior minister Horst Seehofer, Merkel’s rebellious right-wing rival, who forced a coalition crisis over Germany’s asylum policy last summer. -National PostAs rejected asylum claims pile up - and arrivals have normalized since a flood of 700,000 migrants three years ago, the billboard campaign is aimed at the roughly 235,000 people who are still required to leave the country according to the interior ministry. Most asylum seekers whose claims have been rejected can't return to their country of origin due for several reason; danger, lack of documentation or they suffer from an illness. The German government has dubbed these people "duldung," which means "tolerated." Denied asylum seekers who don't fit either of those categories typically don't show up for their deportation. Of more than 20,000 scheduled airport repatriations in 2018, just half of them appeared to take flights back home. Seehofer, the German interior minister, aims to encourage migrants to leave with the cash-giveaway billboard campaign - offering 1,000 - 1,200 euros for a single person and 3,000 for families to provide for basic needs. Not everyone is a fan of the new "stepping stone system," in which "you get more money if you choose to leave earlier on," according to Meiki Riebau - a lawyer and migration expert at Save the Children Germany. Riebau - who is not a fan of the campaign, says "It's a tasteless Christmas present."
Gun Ownership Surges In Europe Amid Wave Of Terror Attacks, Migrant Crime - For decades, European countries have historically maintained some of the heaviest restrictions on civilian gun ownership, leaving the rate of firearms in circulation far below comparable levels in the US and South America. But following a string of high-profile terror attacks in recent years, the number of people applying for legal gun ownership in countries including Germany and Belgium has surged, as European citizens become increasingly concerned about personal security in the face of a wave of Islamic terror and an unchecked migration crisis that has led to a surge in crime.As the Wall Street Journal reported, in Germany, the number of legally registered weapons rose roughly 10% to 6.1 million during the five years through 2017, the most recent year for which data from Germany’s National Weapons Registry was available. Furthermore, permits to carry arms outside of shooting ranges more than tripled to 9,285 during the same period.Meanwhile, applications for shooting licenses in Belgium almost doubled following the massacre at a Paris concert venue in November 2015, which was followed four months later by an attack in Brussels, offering "a clear indication of why people acquired them,” according to Nils Duquet of the Flemish Peace Institute, who spoke with WSJ for its story. Since 2016, there have been more than 16 terror attacks in Europe attributed to ISIS, according to ESRI's terror-attack tracker.
Drawing the Line on U.S. Reassurance to Eastern Europe - Lawfare After quietly studying the issue since 2014, the U.S. Department of Defense began writing a congressionally-mandated report late last year on whether to establish a U.S. Army base in Poland. In September 2018, the media caught wind of Warsaw’s proposal to host a permanent U.S. military presence on its territory after Polish President Andrzej Duda offered to contribute $2 billion towards the construction of a U.S. military base and name it after President Donald Trump. Despite its potential to fundamentally reshape Washington’s and NATO’s military strategy toward Russia, the Pentagon study has garnered relatively little attention so far. If the Defense Department recommends accepting the Polish government’s offer, it will mark the first permanent buildup of U.S. forces in Europe since the Cold War. That alone would be a significant development worthy of Americans’ attention. But the study—which isdue to Congress by March 2019—could also send a signal about the future direction of U.S. national defense strategy, more broadly. Although a decision to permanently deploy U.S. troops to Poland may seem improbable to many Trump-watchers owing to the president’s hostility toward NATO and his recent decision to withdraw troops from Syria, such a move would be in line with Trump’s views about alliances. Since emerging on the political stage four years ago, Trump has repeatedly shown himself to be much more comfortable with an alliance system organized around transactional, pay-to-play relationships, rather than common values and ideals. Lured by the promise of Polish zlotys, the White House is reportedly already on board with sending more U.S. troops to Poland. However, establishing a permanent U.S. military presence in Poland would be a strategic mistake.
French official tapped to lead Macron’s ‘national debate’ quits amid salary controversy - Chantal Jouanno, a former sports minister, said she could not guarantee conditions for a calm debate as she had become a focus of attention after a news magazine revealed she was paid 14,700 euros ($16,800) per month to head France's National Commission for Public Debate. The Commission is a consultative body on environmental issues. Jouanno's sudden withdrawal marks an early setback for the national debate due to be launched next week, giving embattled President Emmanuel Macron little time to appoint a successor. The debate, whose precise mechanisms remain unclear, is one of the key proposals he made last month in response to the wave of sometimes violent protests that has spread across the country since November. It is expected to touch on a range of subjects including ecology, taxes, citizenship and democracy, and take place in town halls across the country as well as online. Relief measures Driving the recent unrest is anger, particularly among low-paid workers, over a squeeze on household incomes and a perception that Macron is indifferent to ordinary citizens' needs as he enacts reforms seen as pro-business and favouring the wealthy. The Yellow Vest movement – named after the neon safety jackets that are mandatory in French vehicles– prompted Macron's government to announce financial relief measures in December, including a state-funded supplement to the minimum wage, but many protesters say the measures are not enough.
Growing “yellow vest” protests defy French police repression - On Saturday, “yellow vest” protesters mobilized their first day of action in 2019, in substantially larger numbers compared to the last protests of 2018, despite escalating police violence. Even according to the official Interior Ministry statistics, the eighth weekly protest of the “yellow vests” gathered 50,000 people across the country, compared to 32,000 on December 29.It refuted all those who cited the dip in the number of protesters during the holidays to proclaim the end of the movement. At the same time, Macron was ordering the two-day preventive detention of “yellow vest” spokesman Eric Drouet, for having gone to Paris for a private commemoration of “yellow vests” killed during the movement; and Macron was also denouncing the “yellow vests” in his New Year’s wishes for having forced him to hear “unacceptable things.” These transparent attempts to demoralize and intimidate the “yellow vests” utterly failed.Instead, “yellow vests” defied a wave of police violence, in Paris and the provinces, to demonstrate against the government of the rich, which is implacably hostile to their demands for wage increases, jobs, social equality and peace. In Paris, 3,500 protested, in Toulouse and Rouen 2,000 and in Bordeaux over 5,000. In Lyon, thousands of people took to the streets, briefly spilling into a section of the A7 motorway that passes through the city.While the demonstrations began peacefully, clashes broke out in several major provincial cities due to provocations from the security forces including in Caen, Nantes and Bordeaux. In Rennes, a group of protesters broke a door at city hall. In Rouen, police shot one demonstrator in the head with a rubber bullet while in Montpellier, four riot police and three protesters were lightly wounded after clashes broke out, and five people were arrested. Police arrested six in St Etienne on charges of throwing objects at the security forces.
Yellow vests: France to crack down on unsanctioned protests ---French Prime Minister Edouard Philippe has announced plans to punish people who hold unsanctioned protests after seven weeks of anti-government unrest. His government wants to draft new legislation that will ban troublemakers from protests and clamp down on the wearing of masks at demonstrations. He said 80,000 members of the security forces would be deployed for the next expected wave of protests. Protesters smashed down the gates to a government office this weekend. In other chaotic scenes in Paris, demonstrators fought riot police, and cars and motorbikes were burnt. Protests against fuel tax erupted on 17 November when people across France donned high-visibility vests, giving them their nickname the "gilets jaunes" ("yellow vests"), and went out to disrupt traffic. Similar actions have followed every weekend and while the number of demonstrators has dropped, cities across France continue to see rioting and disruption. At least six people have died and at least 1,400 have been injured as a result of the unrest.
France Moves To Ban All Protests As PM Announces Major Crackdown On Yellow Vests - France is signaling it's making preparations for a massive new crackdown on the gilets jaunes or "yellow vests" anti-government protests that have gripped the country for seven weeks. A new law under consideration could make any demonstration illegal to begin with if not previously approved by authorities, in an initiative already being compared to the pre-Maiden so-called "dictatorship law" in Ukraine. In the name of reigning in the violence that has recently included torching structures along the prestigious Boulevard Saint Germain in Paris, and smashing through the gates of government ministry buildings, the French government appears set to enact something close to a martial law scenario prohibiting almost any protest and curtailing freedom of speech. Prime Minister Edouard Philippe presented the new initiative to curtail the violence and unrest while targeting "troublemakers" and banning anonymity through wearing masks on French TV channel TF1 on Monday. He said the law would give police authority crack down on "unauthorized demonstrations" at a moment when police are already arresting citizens for merely wearing a yellow vest, even if they are not directly engaged in protests in some cases. PM Philippe said the government would support a "new law punishing those who do not respect the requirement to declare [protests], those who take part in unauthorized demonstrations and those who arrive at demonstrations wearing face masks".Philippe's tone during the statements was one of the proverbial "the gloves are off" as he described the onus would be on "the troublemakers, and not taxpayers, to pay for the damage caused" to businesses and property. "Those who question our institutions will not have the last word," he added. However, if anything the protests have grown fiercer in response to any police crackdown or violence against demonstrators. Should all protests be banned under the new law, it could be the start of more violent riots gaining steam, as what began Nov. 17 as anger over fuel tax hikes has now turned into rage at President Emmanuel Macron and policies that seem to favor the urban elite.
Salvini Backs Yellow Vests Against Macron; Claims French President Against His People - Italy's Interior Minister Matteo Salvini and his coalition partner have announced their support for France's Yellow Vest movement, accusing French President Emmanuel Macron of being "against his people." "I support honest citizens protesting against a president who governs against his people," Salvini said in a statement - while at the same time "firmly" condemning protesters who have resorted to violence. Meanwhile, Luigi Di Maio, the 32-year-old Deputy Prime MInister of Italy who leads the Five-Star Movement (M5S), has told the Yellow Vests in a Monday blog post "do not give up!" De Maio offered French protesters use of the M5S "Rousseau platform" to help the Yellow Vests improve organization and "draw up an electoral programme," according to France24. "This system (Rousseau) is made for a horizontal and spontaneous movement such as yours and we would be happy if you want to use it." The 5 Star Movement is ready to give you the support you need. Like you, we too strongly condemn those who caused violence during the demonstrations, but we know that your movement is peaceful . We can put at your disposal some functions of our operative system for direct democracy, Rousseau , for example call to action to organize the events on the territory or the voting system to define the electoral program and choose the candidates to be presented in the elections. It 'a system designed for a horizontal and spontaneous movement like yours and we would be happy if you wanted to use it. -Il Blog delle Stelle (translated) https://t.co/cBJvUwEk5s— Luigi Di Maio (@luigidimaio) January 7, 2019Meanwhile, The Globe and Mail reports that Macron's tough stance on the Yellow Vest movement has backfired, as French authorities struggle to maintain order. What began as a grassroots rebellion against diesel taxes and the high cost of living has morphed into something more perilous for Macron - an assault on his presidency and French institutions. The anti-government protesters on Saturday used a forklift truck to force their way into a government ministry compound, torched cars near the Champs Elysees and in one violent skirmish on a bridge over the Seine punched and kicked riot police officers to the ground. -The Globe and Mail
Hungary's Orban Slams Macron As 'Leader' Of "Pro-Immigration Forces", Vows "I Will Fight Against Him" - One day after Italy's Matteo Salvini traveled to Poland to discuss forming an international, inter-party alliance of anti-immigration populist nations to contest the EU Parliamentary elections in May, on Thursday, another prominent eurosceptic leader lashed out at the European establishment. After a reporter from the French paper Le Monde asked Hungarian Prime Minister Viktor Orban about his relationship with deeply unpopular French President Emmanuel Macron, Orban said that while he has nothing against Macron personally - in fact, the two get along well - he considers Macron to be the standard bearer for the EU's globalist, "pro-immigration forces."And therefore, "I must fight him," Orban said."There is no denying that Emmanuel Macron is an important figure, moreover, the leader of the pro-immigration forces," Orban told a press conference."It is nothing personal, but a matter of our countries' future. If what he wants with regards to migration materializes in Europe, that would be bad for Hungary, therefore I must fight him." Orban's Fidesz party won a stunning parliamentary victory last year and remains supremely popular among Hungarians, particularly in more rural parts of the country. However, Orban's refusal to bend to the EU's mandates about member states accepting refugees and migrants prompted the EU Parliament to trigger Article 7 sanctions proceedings against Hungary back in September. This marked the first time the EU had ever invoked an Article 7 resolution.For those who are unfamiliar, Article 7 of the EU Treaty was designed to protect the bloc's "fundamental values" (because enforcing immigration laws and securing borders is apparently seen as a moral outrage in Brussels).The Article 7 invocation could ultimately lead to a suspension of membership rights for Hungary.
The Dutch love to plan. But even they may not be able to avoid the chaos of a no-deal Brexit. WaPo - — The Hook of Holland, a stretch of land outside Rotterdam sliced by canals, functions in many ways like Britain’s backyard. Greenhouses stretch for miles, nurturing tulips, tomatoes and other supermarket specialties. The bounty is gathered into warehouses and sorted under signs denoting destinations such as Sheffield and Gateshead. Then trucks whisk it all onto ferries headed across the North Sea. Thanks to this precisely calibrated ecosystem and the European Union’s borderless trading zone, British shops can order fresh produce early in the morning and receive it by the end of the day. But a no-deal Brexit threatens to throw it all into chaos, resulting in trucks backed up for miles, vegetables spoiled and economic pain for everyone. The Netherlands — Britain’s main trading partner on mainland Europe — is among the most-prepared for the possibility that Britons will leave the E.U. on March 29 without a deal to manage the withdrawal. Leaders here fear that the best efforts of a nation that loves to be prepared may not be enough to safeguard against the mess. And Britain’s other trading partnerships in Europe could be even worse off. “Everyone is fully aware that something is going to happen,” said Mark Dijk, the head of external relations at the Port of Rotterdam, whose docks, rail yards and warehouses handle nearly 1 million tons of goods moving to and from Britain every week. The port has been working on Brexit emergency plans for more than a year and is trying to alert businesses that they need to brace for a wave of restrictions. Britain’s efforts to manage the withdrawal “are so chaotic that it’s hard for people to be sure there won’t be a [no-deal] Brexit,” Dijk said. No precedent exists for a country scissoring itself out of the interconnected modern world. And yet that outcome appears increasingly likely, as the British Parliament prepares to resume debate on a draft withdrawal agreement that has meager support.
Final preparations in place as spaces are drawn out at Manston Airport to turn the runway into a giant lorry park in the event of no deal Brexit chaos - Preparations are well underway in the event of a 'no deal Brexit' as lines for parking spaces have been drawn out at Manston Airport. Up to 150 lorries will be sent from the airport to Dover during rush hour on Monday in a test to see if Britain is ready for a no deal Brexit. The exercise will test the idea of using Manston as a huge lorry park if a no deal causes congestion at Dover because of delays sending goods to Calais. In a letter to hauliers DfT and Kent County Council officials revealed they would run tests during the morning rush hour at 8am, and again at 11am, to 'establish the safest optimum release rate of HGVs' from the airfield to Dover along the A256. It said it would pay for 100-150 hauliers from the local area to take part in the test of Operation Brock. Up to 6,000 lorries could be parked on the site under the plan. Congestion at the Channel ports caused by the reintroduction of customs checks on goods has been one of the most commonly cited negative impacts of a no-deal withdrawal from the EU at the end of March. In the event of congestion, lorries will first be parked on the M20 under Operation Stack in a similar way to when bad weather or strikes close the Dover-Calais route. Once that is full as far as Ashford, trucks would be sent to Manston.
UK’s May could seek more time before final Brexit vote- paper (Reuters) - British Prime Minister Theresa May might again push back a final vote in parliament on her Brexit deal, less than three months before the country is due to leave the European Union, a newspaper reported. The Sunday Telegraph said May’s aides were believed to be drawing up a plan to make approval of the deal by members of parliament conditional on the European Union providing further concessions. The newspaper said the move was intended to help limit the scale of opposition in parliament to her plan while allowing more time for negotiations to continue with EU leaders. May was forced to postpone in December a key vote on the Brexit plan she has agreed with other EU leaders in the face of deep opposition from within her own Conservative Party and other groups in parliament. The vote has been rescheduled for the week starting Jan. 14 after a debate which is scheduled to begin in the coming week. Britain is due to leave the EU on March 29 and May’s inability so far to get her deal through parliament has alarmed business leaders and investors who fear that the country is heading for an economically damaging no-deal Brexit. May renewed her warnings about the possible consequences of parliament not backing her plan, telling the Mail on Sunday newspaper that jobs were at stake and lawmakers would be putting democracy at risk if they did not deliver on the outcome of a the 2016 referendum that backed leaving the EU. The Sunday Times said lawmakers, including some from May’s Conservatives, would try to thwart a no-deal Brexit by proposing that the finance ministry lose its emergency funding powers if parliament did not agree to Britain leaving the bloc without an agreement.
THERESA MAY: Jeremy Corbyn didn’t even read my Brexit deal before he rejected it. His policy’s a cynical tissue of incoherence – By Theresa May - This can be a year when the United Kingdom turns a corner – when we draw on our enduring strengths to build a better future for our country. In every task we face – from growing an economy that provides opportunity for everyone, and sustaining the first-class public services we all rely on, to keeping everyone in our country safe – we can be inspired by those strengths. That is certainly true when it comes to the most pressing matter facing us: Brexit. When MPs cast their vote on our withdrawal from the EU, they will determine the future course our country will take. A democratic process, begun when the Conservative Party won an overall majority in a General Election with a manifesto commitment to hold an in-or-out vote, continued through a keenly fought referendum, will culminate in the representatives of the people having their final say. When they do so, MPs must ask themselves three things. Does the deal I have negotiated deliver on the result of the EU referendum by taking us out of the EU and restoring sovereign control over our borders, laws and money? Does it protect the jobs our constituents rely on to put food on the table for their families and the security co-operation that keeps each one of us safe? Does it provide the certainty that citizens and businesses have every right to expect from those who govern and represent them? I believe my deal does all of those things. And no one else has an alternative plan that passes those three tests. There are some in Parliament who, despite voting in favour of holding the referendum, voting in favour of triggering Article 50 and standing on manifestos committed to delivering Brexit, now want to stop us leaving by holding another referendum. Others across the House of Commons are so focused on their particular vision of Brexit that they risk making a perfect ideal the enemy of a good deal. Both groups are motivated by what they think is best for the country, but both must realise the risks they are running with our democracy and the livelihoods of our constituents. Our genius for pragmatism is a defining British trait. At moments of profound challenge, we always find a way forward that commands the confidence and consent of the whole community. This is such a moment.
Brexit CRISIS meeting: Will Theresa May CANCEL MPs’ weekends and holiday time? The Prime Minister will summon Brexit Secretary Stephen Barclay and Chief Whip Julian Smith to the emergency meeting. With just 81 days left before the UK leaves the EU on March 29, they will discuss how much parliamentary time is needed and whether it requires forcing MPs to sit on Fridays and even weekends. The potential plan comes after Mrs May resisted pressure from Labour at the end of last year to shorten MP’s Christmas holiday for the same reason. The Prime Minister has allegedly been warned she may end up with “bad legislation” because she delayed the meaningful vote on the deal for so long there is not enough time left for Parliamentary scrutiny of the subsequent Bill. The European Union (Withdrawal Agreement) Bill will enshrine the Withdrawal Agreement in law, but requires three readings in each of the Commons and the Lords and to be examined by the Brexit Committee. One Whitehall source told the Telegraph: “The truth is there needs to be drastic action to get the legislation through.
‘Increasing Number’ Of Tory MPs Are Considering No-Deal Brexit As A ‘Viable’ Plan B -An increasing number of Tory MPs and voters are coming round to the idea of backing a no-deal Brexit, several party sources have told HuffPost UK, in a shift which could have serious implications if Theresa May’s deal is blocked. With the prime minister struggling to wring concessions from a reluctant EU on her Brexit deal, MPs who oppose it have seen little over Christmas to win them over to backing the deal. Several senior Tories told HuffPost UK that as the reality of a no-deal Brexit is discussed more widely, more MPs are beginning to think of it as a viable option. The shift comes despite the government’s own analysis suggesting leaving without an agreement could deliver a 9.3% hit to Britain’s economy over 15 years. While the majority of MPs remain vehemently opposed to no-deal, it remains the default position if they do not back something else, such as the agreement on the table, a second referendum, or a revoking of Article 50 before exit day on March 29. The numbers in favour of the other options could decline if more Tories favour no-deal. One senior Tory who voted Remain said increasing numbers are backing the “no deal and no money” plan, which would see Britain withhold its £39bn “divorce” bill to soften the crash landing, although it remains unclear whether the government would renege on its legal obligation to settle its accounts with Brussels and risk the country’s global reputation. “We won’t be able to get certain foods like bananas or tomatoes but it’s not like we won’t be able to eat. And we’ll be leaving at a time when British produce is beginning to come into season so it’s the best possible time to leave with no deal.”
Commons revolt over No Deal: More than 200 MPs will tell Theresa May to rule out leaving without an agreement even if her proposals are rejected -More than 200 MPs are expected to warn Theresa May today they will never accept a no deal Brexit. The cross-party group led by former Tory Cabinet minister Dame Caroline Spelman and Labour frontbencher Jack Dromey will urge Mrs May to guarantee that the UK will not leave the EU without a deal even if her own proposals are defeated in the Commons next week. And the group, which includes nine former Cabinet ministers, will meet the Prime Minister tomorrow to press their case that a no-deal Brexit would cause ‘economic damage’ and cost thousands of jobs. In a letter to Mrs May, they said: ‘As a cross-party group of MPs, business leaders and representatives, we are united in our determination that the UK must not crash out of the EU without a deal.‘We urge the Government to agree a mechanism that would ensure a “no deal” Brexit could not take place, and are confident this is a path that Parliament would support.’ Dame Caroline said the group also had the backing of major employers such as Rolls-Royce, Jaguar Land Rover, Airbus and Ford, and employers’ groups such as the CBI, the EEF manufacturers’ group and the Society of Motor Manufacturers and Traders. Political signatories include former Tory Cabinet ministers Sir Oliver Letwin, Nicky Morgan and Dominic Grieve, their Labour counterparts Harriet Harman, Yvette Cooper, Ben Bradshaw and Liam Byrne, and the former Lib Dem energy secretary Sir Ed Davey.
Backstop letters between London and Brussels to be scrutinised - A formal exchange of letters between the EU and the UK, stipulating that the Northern Ireland backstop will be temporary and superseded by a comprehensive trade deal, is to be examined by officials as a way to break the Brexit impasse at Westminster. The moves, likely to be approved by the Government, come as British prime minister Theresa May steps up efforts to secure the backing of the House of Commons for the agreement reached with the EU on the UK’s withdrawal. Mrs May on Sunday insisted that the vote – postponed before Christmas – would go ahead next week, but the DUP, which props up her government, described the backstop as “the poison which makes any vote for the withdrawal agreement so toxic”. Mrs May was sticking firmly to her position that the backstop – a mechanism that aims to insure there is no hard Irish border should the UK not reach a deal – was a necessary part of the agreement. Her comments were welcomed by Taoiseach Leo Varadkar, who was speaking on the first day to a trip to Mali. “One thing the prime minister said today which I think is very valid and I hope will be listened to is that avoiding a hard border between Northern Ireland and the Republic of Ireland is not just the case of people saying they don’t want one,” he said. The Taoiseach said an agreement on “the same customs rules and full regulatory alignment” was required to avoid a hard border.
Exclusive: British officials ‘putting out feelers’ with EU for Article 50 extension - British and European officials are discussing the possibility of extending Article 50 amid fears a Brexit deal will not be completed by March 29, the Telegraph can reveal. Three separate EU sources confirmed that UK officials had been “putting out feelers” and “testing the waters” on an Article 50 extension, even as the Government said it had no intention of asking to extend the negotiating period. The discreet diplomatic contacts, described by one source as officials “just doing their homework”, emerged as a minister broke ranks for the first time to raise the possibility of extending the talks. Margot James, the digital minister, admitted that “we might have to extend Article 50” if Theresa May loses next week’s Parliamentary vote on her Brexit deal. Downing Street said Ms James was wrong, but her comment sowed suspicion among Brexiteers that ministers were trying to soften up MPs for the possibility that Brexit will have to be delayed. As tensions in Westminster heightened before next week's vote, a business minister vowed to resign from the Government if it proved necessary to stop no deal. Leave-supporting Tories fear the party will be punished at the polls - starting with the May local elections - if the Prime Minister breaks her promise to take Britain out of the EU on March 29.
Brexit analysis: Why an extension of Article 50 now looks inevitable -- It is a mantra of the Brexit negotiations that the ‘clock is ticking’, but with just 80 days left until March 29 concerns are growing that time is running out to complete a deal in that timeframe, raising the prospect of an extension to Article 50.The Government remains adamant it has no intention of doing this, but as the Telegraph reports today, UK officials in Brussels are already “putting out feelers” about how this might be done, if and when the Government changes its mind. Here we look at why an extension of Article 50 now looks increasingly inevitable, and under what circumstances it might happen.
$1 trillion is leaving Britain because of Brexit - Brexit hasn't happened yet but it's already shrinking the United Kingdom's financial services industry. Banks and other financial companies have shifted at least £800 billion ($1 trillion) worth of assets out of the country and into the European Union because of Brexit, EY said in a report published Monday. Many banks have set up new offices elsewhere in the European Union to safeguard their regional operations after Brexit, which means they also have to move substantial assets there to satisfy EU regulators. Other firms are moving assets to protect clients against market volatility and sudden changes in regulation. The consultancy said the figure represented roughly 10% of the total assets of the UK banking sector, and was a "conservative estimate" because some banks have not yet revealed their contingency plans. "Our numbers only reflect the moves that have been announced publicly," said Omar Ali, head of financial services at EY. "We know that behind the scenes firms are continuing to plan for a 'no deal' scenario." EY has tracked 222 of the biggest UK financial services companies since the Brexit referendum in June 2016. Britain is scheduled to leave the European Union in just 81 days, but Prime Minister Theresa May still needs to win support in the UK parliament for the divorce deal she struck with the rest of the European Union.
Brexit: gridlock - Forced to decide whether a Secretary of State might be lying or is simply ignorant, I think I would prefer to choose the former. The idea of senior government members not knowing what they are doing is not one with which I am terribly comfortable. When it comes to the Secretary of State for Transport, though, I would find it more difficult to accept that he is lying. It is the easiest thing in the world to believe that, in Chris Grayling, we have a man who would struggle to get to grips with the Ladybird book of motor cars. Tootles the Taxi might be more his level. Thus, when yesterday he delivered a written statement to parliament, updating MPs on the government contracts with ferry operators, one has to give him the benefit of doubt on his more dubious claims, and assume that he doesn't realise the errors he is perpetrating. What particularly sticks in the craw is the way the assertion that the Department for Transport has completed a procurement process to secure additional ferry capacity between the UK and the EU gets transformed into a process of providing additional freight capacity, as if they were the same things. It is not pedantic to say in this context that, when it comes to ro-ro ferries, these ships do not carry freight, as such. They carry lorries and it is those that carry the freight – assuming they are loaded, which is not always the case. About a third of the lorries travelling on ferries from the UK to the continent are returning empty. Measurement of capacity, though, is rather more complex, as we are not so much talking about individual ferries or lorries, but of the tonnage that can be delivered via the combination of the various routes to their final destinations in a given period. Comparing lorries with a the same load-carrying capacities, if one group takes twice as long to deliver the goods via a specified route than by another, and if a similar number of ferries transporting them can only hold half the number of vehicles, that route capacity is only a quarter of its comparator.
Brexit: MPs try to limit government’s no-deal financial powers - MPs who do not want the UK to leave the EU without a deal are trying to limit the government's financial powers in the event of a no-deal Brexit. The House of Commons will vote shortly on a cross-party amendment to the Finance Bill, which enacts the Budget. Several senior figures back the move, but International Trade Secretary Liam Fox called it "irresponsible". No 10 said it would not stop tax being collected, describing the MPs' move as "more inconvenient than significant". Downing Street said the amendment, which could be voted on about 19.00 BST, was "not desirable" and Mrs May was striving to get her deal through Parliament. Meanwhile, minister Richard Harrington said he is prepared to resign to stop the possibility of a no-deal Brexit. Mr Harrington suggested to BBC Newsnight that others might follow suit, saying his position was "not an uncommon one". MPs will seek to turn the screw on ministers with Tuesday's amendment, which is intended to demonstrate to the government the strength of opposition to a no-deal Brexit in the Commons. .
May Is Cornered by Parliament as She Fights for Her Brexit Deal - Prime Minister Theresa May will re-start her stalled bid to win support for her Brexit deal on Wednesday, just a day after her strategy suffered a serious defeat. The premier has five working days to overcome political opposition to the exit agreement she’s negotiated with the European Union before the deal is put to a vote in Parliament on Jan. 15. If the House of Commons defeats her plan, May says Britain will be facing an economically damaging no-deal Brexit in March. The prime minister is stepping up preparations for leaving the EU without an agreement, amid warnings that such an outcome could crash the pound by 25 percent and hit house prices by as much as 30 percent, risking a recession. Her team hopes such a bleak outlook will persuade more than half of the 650 members of Parliament to accept May’s deal as the best way to avoid economic ruin, when the Commons resumes debating the EU Withdrawal Agreement on Wednesday. But May’s hopes now seem thinner than ever after Parliament undermined her threat of an explosive no-deal exit. The House of Commons voted on Tuesday night to take steps to restrict May’s room for maneuver and make leaving the EU without an agreement potentially more difficult. May lost the vote because 20 of her own Tories chose to take a stand against the prospect of crashing out of the bloc of 28 countries with no deal in place.
Parliament can agree that it doesn’t want a no deal Brexit, but that’s it - Theresa May has become the first British Prime Minister for 41 years to lose a vote on a finance bill after 20 Conservative MPs rebelled against the party whip and backed Yvette Cooper’s amendment, which sharply limits the government’s tax-raising powers in the event of a no-deal Brexit. What does it mean for the resolution of the Brexit crisis? Although Cooper’s amendment was billed as “preventing no deal”, as she herself freely conceded in the House, the amendment itself does no such thing. In fact, by limiting the government’s powers to raise revenue, it sharpens the rocks at the bottom of the ravine rather than pulls the country away from the cliff edge. But the amendment has two important implications. The first is that it gives Parliament an opportunity to avert a no-deal exit at the eleventh hour if the need arises. The second is that, as it was billed and seen by MPs as an opportunity to demonstrate the strength of the parliamentary majority against a no-deal exit it gives us a sense of the size of that majority – and its limitations.. It’s a small majority: just seven votes, with 303 votes in favour of Cooper’s amendment, and 296 against. But we can fairly say that it would be a little bit bigger in a hypothetical “no deal versus x” vote (x being “whatever the alternative to no deal is”), for several reasons. The first is that ultimately this vote is not going to prevent a no-deal exit, and there is not the immediate risk of one, which means that we should regard 20 as the lower end of the potential Conservative rebellion. We can add at least six votes from MPs currently in ministerial offices, as several MPs would resign from the government rather than allow a no-deal exit to occur. (The total number of possible resignations is bigger than six, but it’s a universal truth that not everyone resigns when pushed.) We can also fairly add a handful of extra votes from the backbenches of MPs in marginal constituencies who do not have religion on the European issue and wouldn’t, when push comes to shove, risk a no-deal exit.
In Another Dramatic Defeat For May, MPs Back Measure To Block No Deal Brexit - In another stunning defeat for Theresa May and her senior cabinet, MPs on Tuesday backed a measure intended to thwart the possibility of a 'no deal' Brexit by attaching an amendment to a crucial Finance Bill that will effectively force the UK government to shut down if Article 50 isn't suspended or Parliament doesn't explicitly vote to approve a 'no deal' exit. The so-called "Cooper amendment" to the finance bill was tabled by Labour’s Yvette Cooper and had become the focus of Brexit related drama since Parliament returned from its Christmas break this week. The vote passed 303-296 with the help of 20 Tory rebels. Cable has been weakening all day (though it didn't react much to the vote). Meanwhile, three Labour MPs also broke ranks to vote with the government.Twenty Tory rebels voting against Government: Including Sir Michael Fallon... Greening, Gyimah, Soames, Vaizey, Letwin, Boles, pic.twitter.com/dmu4sSPCZO— Faisal Islam (@faisalislam) January 8, 2019In the wake of May's latest defeat, her government has stood by its rhetoric, with Treasury Minister Robert Jenrick saying the "simple truth" remained that the UK would leave the EU on 29 March. All the amendment would do, he told MPs, would be to make the UK "somewhat less prepared" for Brexit.Sir Oliver Letwin, the former Tory minister who backed the amendment, said "the majority tonight that is expressed in this house will sustain itself. We will not allow a no-deal exit to occur at the end of March," the Guardian reported.According to the BBC, the defeat comes a day after senior ministers spoke out about the risks associated with a 'no deal' Brexit. Work and Pensions Secretary Amber Rudd said the public would adopt a "dim view" of the government if it allowed Brexit to proceed without a deal, adding that it could pose a threat to public safety. Labour Leader Jeremy Corbyn applauded Cooper for her efforts and heralded the vote as an important step toward preventing a no-deal Brexit.
May Loses Again as Parliament Dictates Timetable: Brexit Update -- Theresa May was defeated for the second time in two days on her Brexit legislation, as lawmakers voted to take control of the timetable for what happens if Parliament rejects her divorce agreement with the European Union. Key Developments:
- Parliament votes in favor of amendment to Brexit motion, forcing government to respond within three days if loses vote on May’s deal
- Government publishes plans for Northern Ireland assembly to get veto powers related to backstop laws; DUP not impressed
In her second defeat in two days, May has lost control of the timetable for what happens if she loses next week’s vote in Parliament on her Brexit deal. The government now has to hold the debate and vote on what to do next within three sitting days -- realistically, that means Jan. 21.The government was defeated 308 to 297, as the majority in Parliament that opposes a no-deal Brexit once again showed that it can organize itself. Both wings of the Conservative Party have now shown that they’re willing to vote against a Brexit that they don’t like. And the prime minister is no closer to finding an option that both can live with. More drama in the House of Commons as a series of furious Conservative politicians have stood up to attack Speaker of the House of Commons John Bercow over his decision (11:30 a.m.) to allow the Grieve “what next” amendment. This would force the government to come back quickly if it loses the vote on May’s Brexit deal next week.
British prime minister suffers second defeat at hands of pro-European Union MPs - On Wednesday, British MPs voted 308 to 297 for an amendment put forward by pro-European MPs—led by pro-Remain Conservative Dominic Grieve—giving UK Prime Minister Theresa May just three sitting days to present a “Plan B” if parliament votes against her proposed Brexit deal with the European Union.It is expected that MPs will vote by a significant margin against May’s deal next Tuesday evening.Wednesday’s vote means that May will have less than a week to produce an alternative plan—until Monday, January 21—for a vote by MPs. With the UK set to exit the UK in less than 80 days, legislation passed previously allowed her three weeks to come up with another Brexit plan. She was relying on taking any debate and subsequent vote in Parliament right down to the wire—leaving recalcitrant MPs with a choice of backing her deal or facing a chaotic “no-deal Brexit”—as the Brexit timetable expired.May had already postponed a vote on her EU deal by over a month, cancelling a vote scheduled for December 11 at the last minute. She was expected to lose that vote by a massive majority.Wednesday’s vote was the second defeat of the government in less than 24 hours, as a result of pro-Remain Tories blocking with the opposition parties. On Tuesday evening, Labour leader Jeremy Corbyn whipped his MPs to support a backbench amendment to the finance bill tabled by leading Blairite Yvette Cooper. The amendment, restricting the government’s tax powers unless a no-deal Brexit is taken off the table, resulted in a 303 to 296 government defeat, with 20 pro-EU Tory MPs backing it.The amendment put forward Wednesday by Grieve was supported by former Tory ministers Sir Oliver Letwin, Jo Johnson (the brother of hard Brexiteer and former Foreign Minister Boris Johnson) Guto Bebb and Sam Gyimah. Crucially for the Remainers, an amendment to the EU (Withdrawal) Act passed before the Christmas recess—also authored by Grieve—allows MPs to amend any government statement following a Brexit defeat. This allows amendments to be put by the Remain wing demanding that the UK stay in the EU Single Market and Customs Union post-Brexit, as well as other amendments seeking to delay the process.The pro-Remain Financial Times described the passage of Cooper’s amendment on Tuesday as marking “the start of a parliamentary war of attrition against a no-deal Brexit.”
Brexit: Second Commons defeat for Theresa May in 24 hours - Rebel Conservative MPs have joined forces with Labour to inflict a fresh blow on Theresa May's government in a Commons Brexit vote. It means the government will have to come up with revised plans within three days if Mrs May's EU withdrawal deal is rejected by MPs next week. It could also open the door to alternatives, such as a referendum. No 10 said Mrs May's deal was in the national interest but if MPs disagreed, the government would "respond quickly". The setback for the PM came as MPs started five days of debate on the withdrawal agreement with the EU, and the framework for future relations, ahead of the meaningful vote next Tuesday. The government was expecting to have 21 days to come up with a "plan B" for Brexit if, as widely expected, Mrs May's deal is voted down. But MPs backed calls for it to respond within three working Parliamentary days, a deadline likely to fall on Monday 21 January. Theresa May lost by 11 votes, with 297 MPs siding with the government and 308 against. Among those voting against were 17 Conservatives, including former ministers Justine Greening, Sam Gyimah and Jo Johnson who want to see another referendum to decide whether the UK should leave or not. Former attorney general Dominic Grieve, the Conservative MP who led the rebellion, said he hoped for a "serious dialogue" between government and Parliament on alternatives to Mrs May's deal to avert a possible crisis. He told ITV's Peston that it would be up to Mrs May to decide what she wanted to do if her deal was rejected, but MPs would be able to vote on any motion she put forward within seven days. While the PM would have the right to say she wanted the Commons to re-consider her deal, he said MPs could amend the motion, telling her in effect "we want you to do something else". Fellow rebel Sarah Wollaston said she and other MPs opposed to a no-deal exit were engaged in a "guerrilla campaign" to show that it would never get the consent of Parliament.
The Growing Parliamentary Revolt Against Brexit - UK Prime Minister Theresa May is a difficult one to pin down. While she was home minister for David Cameron (remember him?) during the run-up to the ill-fated 2016 Brexit vote, she decided to support Cameron's position to remain in the EU. After replacing him, though, she became famous for the pithy statement that "Brexit means Brexit." To be fair, she is stuck between an EU unwilling to make many compromises lest others see that they can leave the EU and still benefit from many of the privileges of membership and hardline Brexit elements in her party. Still, it seems a revolt is brewing among nearly everyone else not as prone to suicidal behavior. Like a moth to the flame. The past two days have witnesses a cross-party revolt against crashing out of the EU with no preferential agreements. Yesterday, opposition stalwart Yvette Cooper's motion to deny May's government of taxation powers in the event a Brexit deal is not agreed to. Instead, parliament must be consulted: Theresa May's no-deal Brexit preparations suffered a blow after MPs defeated the Government in the Commons. Labour former minister Yvette Cooper tabled an amendment to the Budget-enacting Finance (No. 3) Bill which attracted support from Tory rebels. Her proposal aims to restrict the Government's freedom to use the Bill to make tax changes linked to a no-deal Brexit without the "explicit consent" of Parliament. It was supported by 303 votes to 296, a majority of seven. In a statement outside the Commons, [Opposition Leader Jeremy Corbyn] said the vote in support of the amendment was "an important step to prevent a no-deal Brexit". He said: "It shows that there is no majority in Parliament, the Cabinet or the country for crashing out of the EU without an agreement. That is why we are taking every opportunity possible in Parliament to prevent no deal. Today we had a second round of good news (if you're anti-Brexit, that is). The half-baked deal May came away with from meeting with her EU counterparts is likely going to voted down next week. In that event, the cross-party rebellion is now forcing the government to come up with a "Plan B" within 3 days instead of 21 days:
Desperate Theresa May caves in on workers’ rights to save Brexit deal - Theresa May is hoping to win the support of Labour MPs for her Brexit deal by backing key guarantees on workers’ and environmental rights. The Mirror understands the Government is likely to support an amendment put down by Labour MPs who could be open to backing her in the crunch vote next week. As many as 20 Labour MPs, most of them with Leave voting seats, could rally behind the Prime Minister’s plan if she throws Downing Street’s weight behind the move. Bassetlaw MP John Mann told the Mirror that the amendment would make Mrs May’s deal “more attractive” and tackle key Labour concerns. Caroline Flint, MP for Don Valley, added: “Given the government cannot rely on the hard Brexiteers on their side, they have to reach out across the House to Labour.”Earlier, Shadow Brexit secretary Keir Starmer told MPs he had been surprised the Government had not approached him. “I actually thought at some point somebody would give me a ring,” he said. It came after another day of high drama in the Commons during which the PM suffered her second crushing defeat on Brexit in 24 hours. A cross-party group of MPs backed a rebel amendment, by 308 votes to 297, to force Mrs May to come back before them within three days to set out her Brexit Plan B if she loses Tuesday’s vote. Downing Street admitted publicly for the first time that Mrs May was now planning for what happens next if she is defeated in her ‘meaningful’ vote on Brexit. Ministers also offered new assurances to MPs that they would have more control of the controversial backstop if they backed her deal.
May Caves, Offers Brexit-Deal Concessions Following Dramatic Commons Defeats - After being effectively frozen in place since Prime Minister Theresa May survived a Tory no confidence vote late last year, the dynamics of the debate in Parliament are finally beginning to shift now that MPs have taken steps to seize control of the process from No. 10 Downing Street.In a series of embarrassing defeats for May's government earlier this week, MPs voted to limit the government's ability to use the threat of a 'no deal' Brexit as a cudgel to coerce MPs into backing May's deal, while the "Grieve Amendment" (sponsored by Tory MP and former Attorney General Dominic Grieve), passed on Wednesday, requires May to call a vote on a "Plan B" Brexit deal within three days should she lose a vote next week on her deal.With her back against the wall as the debate on her Brexit plan enters a second day, it appears May has finally relented on her insistence that she would not yield to demands to change her deal, even as her Parliamentary archnemsis Jeremy Corbyn appeared to back away from threats to take down her government.While Corbyn said during a speech on Thursday that he wouldn't table a motion of no confidence in May's government (which, if successful, would clear the way for a general election that would inject a fresh helping of chaos into the process) if the vote should fail, offering May some more room to maneuver, the Financial Times reported that the prime minister has put forward a "package" of concessions including granting Parliament power over whether the Irish backstop is triggered, implementing requirements to conclude a future UK-EU trade deal within one year should the backstop take effect, and offering a slate of 'workers rights' reforms and promising to work with the EU, according to the Financial Times.May would also be required to obtain "further assurances" from the EU that the backstop will likely never take effect. Still, as the FT pointed out, it's unlikely that these concessions will win enough support to pass May's deal on the first go-round.
Brexit: Starmer insists a second vote may be the only way out - The shadow Brexit secretary has warned Jeremy Corbyn that a second referendum may now be the only viable option to prevent a no-deal exit from the European Union. The Times understands that Sir Keir Starmer has told the Labour leader that with less than three months to go before leaving the EU the party’s options are limited and it has an obligation not to allow the government to run down the clock on a no-deal Brexit. In a speech today Mr Corbyn will insist that it is still possible for Labour to negotiate a better deal with Brussels and will restate his call for a general election. Yesterday Sir Keir said for the first time that extending Article 50 “may well be inevitable” despite an insistence by his leader’s office that this was not party policy. Sir Keir is believed to have argued that an extension to Article 50 to hold a second referendum could be the only realistic mechanism to prevent no-deal. EU figures have repeatedly said that a limited extension would only be granted either to ratify the existing deal, hold a second referendum or call a general election. Senior Labour sources said that the issue would come to a head after the vote next Tuesday on Mrs May’s deal, which if defeated would lead to Labour calling a motion of no confidence within days. The sources said there would be no change in the party’s position before then but that if the vote of confidence failed then “things will move quite quickly after that”. “We have to take the parliamentary party with us and there are people who are nervous about a second referendum,” they said. “Keir is very clear that any policy has to command support regardless of his personal views.” The shadow justice secretary said today that Labour was not in favour of extending Article 50 but that it might become necessary. In an interview on BBC Radio 4’s Today programme, Richard Burgon said that the party’s preference was for a general election. Sir Keir hinted at his position in a recent interview when he suggested that Labour’s policy of renegotiating Mrs May’s deal was no longer viable. Speaking in the Commons yesterday he said that the government’s handling of negotiations had placed the UK in a position where the only option may be to extend Article 50 and move back the March 29 exit day.
Corbyn to again call for general election to break Brexit deadlock - Jeremy Corbyn is to reiterate his call for the Brexit impasse to be put to the people in a general election, as Labour edged closer to pledging to call a no-confidence vote in Theresa May’s government if her departure plan is voted down in the Commons. At a speech in Wakefield on Thursday, the Labour leader is to argue that if May is unable to get her flagship piece of legislation past MPs next week then her government will have lost all authority, meaning an election is urgently needed. “So I say to Theresa May: if you are so confident in your deal, call that election, and let the people decide,” he will say, according to extracts from the speech released in advance. “To break the deadlock an election is not only the most practical option, it is also the most democratic option. It would give the winning party a renewed mandate to negotiate a better deal for Britain and secure support for it in parliament and across the country.” Labour’s policy on Brexit is to first of all seek a general election, and only if that does not happen to consider the idea of a second referendum, a stance which has prompted some pressure from a membership predominantly keener on another referendum. The party has also avoided specifics on when it might push for an election, something it could force under the Fixed-term Parliaments Act by winning a specifically worded motion of no confidence in the government. On Wednesday, two of Corbyn’s frontbenchers indicated this moment could come very soon after what Labour hopes will be defeat for the government when the delayed vote on May’s Brexit deal finally happens next Tuesday. Barry Gardiner, the shadow international trade secretary, told BBC Radio 4’s Today programme: “Obviously, the next thing to do immediately after that is for there to be a vote of confidence in the government.” Speaking later on Sky News, Andrew Gwynne, the shadow communities secretary, confirmed the plan.
Brexit diehards may soon discover May’s deal is only option -After last month’s European Council meeting in Brussels, some EU leaders and senior officials complained that Theresa May was asking them to resolve her domestic political difficulties. Some, including Germany’s Angela Merkel and European Commission president Jean-Claude Juncker, were more willing to help than others, such as Dutch prime minister Mark Rutte and European Council president Donald Tusk. All agreed, however, that there was little purpose in delivering one concession after another without any evidence that they would be sufficient to win a Commons majority for a Brexit deal. The political convulsion at Westminster, they concluded, must be resolved at Westminster before further EU assurances about the backstop could be effective. That convulsion began to play out this week in remarkable scenes on the floor of the House of Commons, culminating in Wednesday’s vote to allow MPs to take control of the Brexit process if May’s deal is rejected next week. After months during which the fronts on both sides of the Commons chamber seemed frozen, traditionally loyal Conservative MPs voted against the government to block a no-deal Brexit. And some Labour MPs suggested that they could support the prime minister’s deal if it is modified to allow for a permanent customs union with the EU and includes guarantees on labour and environmental standards. Until now May has sought to win a majority for her Brexit deal drawn almost exclusively from Conservative and DUP MPs. Last month she concluded that the DUP’s support was the key to unlocking the votes of Conservative Brexiteers.
This is a Wake-Up Call - UK Auto Sales Plunge Most Since The Financial Crisis - The global automobile collapse that we have been covering in-depth over the past year is continuing apace, with the shockwave most recently hitting the United Kingdom. Sales of new cars in the UK fell at the steepest rate since the financial crisis, according to the Society of Motor Manufacturers and Traders. The numbers were lower due to consumer uncertainty regarding Brexit and the falling popularity of diesel vehicles. Registrations in the United Kingdom were down 6.8% to 2.37 million vehicles in 2018, according to the SMMT. Diesel vehicle sales were down a massive 30% and gasoline powered models were up 8.7%, showcasing a shifting trend. Offsetting this plunge, electric cars and hybrids were up double digits, posting 21% gains for the year. But overall registrations dropped in the mid single digits and the SMMT predicts a further 2.4% reduction in new car sales in the United Kingdom this year. The fall for 2018 was at the high-end of estimates provided by the SMMT and it’s the second year in a row of sales falling. Registrations were down 5.7% in 2017. The CEO of SMMT, Mike Hawes, stated: "The industry is facing ever-tougher environmental targets against a backdrop of political and economic uncertainty that is weakening demand so these figures should act as a wake-up call for policy makers.”
Jaguar Land Rover to cut up to 5,000 jobs - Jaguar Land Rover (JLR) will today announce it is cutting up to 5,000 jobs from its 40,000 strong UK workforce. Management, marketing and administrative roles are expected to be hardest hit, but some production staff may also be affected. The layoffs are part of a £2.5bn cost-cutting plan amid what industry insiders have called a "perfect storm". They mean a downturn in Chinese sales, a slump in diesel sales and concerns about UK competitiveness post-Brexit. JLR is particularly exposed to the first two of these factors. JLR has seen its employee numbers soar as its revenues have expanded. China is the company's biggest and hitherto most profitable market. But sales in China have fallen nearly 50% in recent months as cautious Chinese consumers have been holding back on big ticket purchases amid global trade tensions. The relationship between JLR and its Chinese sales network have also been strained as dealers demand better terms and promotional incentives.
Rolls-Royce Warns Brexit Could Bring Production to a Halt - Some of Britain’s largest and most storied manufacturers are making a last-ditch plea to lawmakers to avoid a disorderly retreat from the European Union with stark warnings of production grinding to a halt and political inertia hurting their business. Ultra-luxury carmaker Rolls-Royce said its factory in southern England risks being paralyzed in the event of a hard Brexit if just one component becomes unavailable because of border delays. At planemaker Airbus SE, which makes the wings for all its aircraft in the U.K., uncertainty about which sort of Brexit may happen has become “really unbearable” and costs for contingency planning and preparations have ballooned into the many millions, Chief Executive Officer Tom Enders said Wednesday night in London. With just 78 days left until the U.K. leaves the EU one way or the other, the political stalemate continues to haunt companies that rely on the uninterrupted flow of goods and stability to make investments. Like other automakers, BMW AG’s Rolls-Royce operates a just-in-time production system, usually holding parts for no more than 24 hours, creating the risk that any supply-chain snags freeze up the entire operation.
Commercialization effects in universities - Responding to students’ call for the sacking of John Finnis from Oxford University because of past homophobic writing, I tweeted yesterday that: If I spend £30,000 on a car I don't expect the salesman to tell me my lifestyle is unacceptable. The idea that universities should be different is a hangover from the days before tuition fees.This needs expanding. I was not justifying the students’ demand but merely getting at a point made by Fred Hirsch back in 1976. He called it the commercialization effect. If we pay for something we have different standards and expectations than we do if we get it for free*. Motivational crowding out happens. If I’m getting something for nothing I’ll be more tolerant of any, ahem, idiosyncrasies of its suppliers than I would be if I’m spending a fortune on it. You cannot create a market in something and then be surprised when customers exercise consumer sovereignty. Economic change causes cultural change. The cash nexus might well transform what used to be a learning experience into just another paid-for leisure activity – and people on cruises don’t expect to be “challenged” or offended by the waiters,In this context, what’s surprising is just how tolerant students still are: as Will Davies has said, the idea that they are intolerant snowflakes is a figment of the right’s imagination. This, though, might not be an immutable fact. It might merely be an example of how culture is slow to change in response to economics. Tuition fees are a sufficiently recent innovation that they have not yet crowded out traditional academic social norms about free enquiry. But they might do so eventually. In this context, there are many issues to consider. Let’s take five.
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