Trump calls on Fed to cut rates by 1%, urges more quantitative easing President Donald Trump, in his most brazen attack yet on the Federal Reserve, called for the central bank on Tuesday to cut interest rates by 1 percentage point and to implement more money-printing quantitative easing.In a two-part tweet, the president unfavorably compared the Fed to its China counterpart and said if monetary policy in the U.S. was looser, the economy would “go up like a rocket.”In the past, White House officials including Trump and top economic advisor Larry Kudlow have recommended the Fed cut rates by half a point. The tweets literally doubled down on that approach.The Fed currently targets its benchmark interest rate in a range between 2.25% and 2.5%. It has hiked the rate nine times since December 2015, though it indicated in March that it likely is done with increases for the rest of 2019 despite forecasting two more at the end of last year.Following the president’s prescription would take the fed funds rate back to its December 2017 level.The jawboning for rate cuts comes despite another strong economic performance in the first quarter. GDP rose at a robust 3.2% after many economists had been predicting little or no growth ahead of the release. Growth has come with little inflation. The Fed’s preferred gauge showed a gain of just 1.6% over the past year excluding food and energy prices. That lack of inflation is the reason Kudlow and others believe the Fed can cut rates without risk. Central banks normally tighten policy in an effort to control prices when the economy is expanding. While it is not unusual for presidents to criticize monetary policy, it historically has been done quietly, making Trump’s public condemnations of Chairman Jerome Powell and his colleagues atypical.
FOMC Statement: No Change to Policy - FOMC Statement:Information received since the Federal Open Market Committee met in March indicates that the labor market remains strong and that economic activity rose at a solid rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low. Growth of household spending and business fixed investment slowed in the first quarter. On a 12-month basis, overall inflation and inflation for items other than food and energy have declined and are running below 2 percent. On balance, market-based measures of inflation compensation have remained low in recent months, and survey-based measures of longer-term inflation expectations are little changed.Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 2-1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective as the most likely outcomes. In light of global economic and financial developments and muted inflation pressures, the Committee will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support these outcomes.In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
Some U.S. Fed officials are more worried by weak inflation - (Reuters) - Two Federal Reserve policymakers on Friday said they were increasingly worried about weak inflation, an indication that some U.S. central bankers see a growing case for a future interest rate cut even as others push for continued patience. Chicago Fed President Charles Evans, speaking at a conference in Stockholm, said this year’s drop in inflation excluding the impact of food and energy was worrisome. He said he was also concerned the economy might underperform. “Then policy may have to be left on hold - or perhaps even loosened,” Evans said in his speech. St. Louis Fed President James Bullard was even more emphatic about his concern about the softness in so-called core inflation, which rose only 1.6 percent in the 12 months through March, well below the Fed’s 2 percent target. “If we go through the summer here and inflation expectations are still too low and actual inflation doesn’t seem to be picking up then I think the level of my concern would get more intense,” Bullard told Reuters in an interview. “I am open to a rate cut to try to combat this, but it would be a rate cut not because of bad data on the U.S. economy. It would be a rate cut because we want to make sure that inflation expectations and eventually actual inflation is more consistent with our 2 percent target,” Bullard said. The remarks by Evans and Bullard, who both have a vote on Fed policy this year, contrasted with Fed Chairman Jerome Powell’s comments to reporters after the release of the central bank’s latest policy statement on Wednesday. Powell repeatedly answered questions about the prospect of a rate cut by saying there was no strong case for moving rates in either direction. That sentiment was echoed on Friday by another senior policymaker, Fed Vice Chair Richard Clarida. He said the U.S. economy was in a “very good place,” with inflation expectations seemingly “stable,” and that the central bank had time to look at incoming data before deciding on any further interest rate changes. Data pointing to economic strength, highlighted by a jobs report on Friday that showed the unemployment rate fell to its lowest level in nearly 50 years in April, and inflation that may be signaling underlying weakness is a conundrum for the Fed. “Underlying inflation trends may be mired below 2 percent,” said Evans in Stockholm, noting that the Fed could some of the credibility that would be needed to fight future recessions if it can’t hit its inflation target. But he added that it was also possible inflation could surge and require rate hikes “over time.”
Stephen Moore says the decline in ‘male earnings’ is a big issue for the economy - The drop in earnings for men is the biggest challenge facing the economy, according to Stephen Moore, the man President Donald Trump has said he wants to nominate to the Federal Reserve board. Speaking Tuesday with CNBC’s “Squawk Box, ” Moore faced questions about past writings, some of which have been classified as sexist by his detractors. Anchor Becky Quick asked him specifically about a piece he wrote for National Review in which he worried about a society where women earned more than men. “The biggest problem I see in the economy over the last 25 years is what has happened to male earnings, for black males and white males as well,” Moore said. “They’ve been declining. That is, I think, a big problem.” “I want everybody’s wages to rise, of course. People are talking about women’s earnings. They’ve risen,” he added. Since 2010, real median weekly earnings for men have risen about 2.1 percent, according to the Bureau of Labor Statistics. Women’s real earnings have gone up 3.9 percent during the period. “The problem actually has been the steady decline in male earnings, and I think we should pay attention to that, because I think that has very negative consequences for the economy and for society,” he said. Moore has not yet been officially nominated for Fed governor, a post that carries a 14-year term. White House officials have said they are continuing to vet his background, and it’s not clear whether he has the requisite votes in the Senate to be confirmed.
Trump: Stephen Moore out as potential Fed nominee — Embattled potential Federal Reserve Board nominee Stephen Moore has withdrawn from consideration for the position, President Trump said in a tweet on Thursday. The announcement comes after several news reports that Moore would not back down from his anticipated nomination to serve on the Fed, despite growing concerns about his confirmation prospects from Republican senators. Moore is the second candidate to have his potential Fed nomination scuttled in less than two weeks. Herman Cain, who once served as chairman of the Kansas City Fed, withdrew from consideration for a seat on the Fed board April 22, after four Republican senators publicly indicated that they would oppose his nomination. Moore's potential nomination has been contentious after past statements in which he suggested it was a problem for the economy if women made more than men. His long history of such remarks prompted several GOP senators, including Sen. Joni Ernst, R-Iowa, to voice objections to the possible pick. Moore himself has continued to claim his nomination was on track. As recently as early Thursday, he told media outlets he was "all-in" on the Fed nomination.
PCE Price Index: March Headline & Core - The BEA's Personal Income and Outlays report for March was published this morning by the Bureau of Economic Analysis. The latest Headline PCE price index was up 0.20% month-over-month (MoM) and is up 1.49% year-over-year (YoY). The latest Core PCE index (less Food and Energy) came in at 0.05% MoM and 1.55% YoY. Core PCE is below the Fed's 2% target rate The adjacent thumbnail gives us a close-up of the trend in YoY Core PCE since January 2012. The first string of red data points highlights the 12 consecutive months when Core PCE hovered in a narrow range around its interim low. The second string highlights the lower range from late 2014 through 2015. Core PCE shifted higher in 2016 with a decline in 2017 and now 2019. The first chart below shows the monthly year-over-year change in the personal consumption expenditures (PCE) price index since 2000. Also included is an overlay of the Core PCE (less Food and Energy) price index, which is Fed's preferred indicator for gauging inflation. The two percent benchmark is the Fed's conventional target for core inflation. However, the December 2012 FOMC meeting raised the inflation ceiling to 2.5% for the next year or two while their accommodative measures (low FFR and quantitative easing) are in place. More recent FOMC statements now refer only to the two percent target. The index data is shown to two decimal points to highlight the change more accurately. It may seem trivial to focus such detail on numbers that will be revised again next month (the three previous months are subject to revision and the annual revision reaches back three years). But core PCE is such a key measure of inflation for the Federal Reserve that precision seems warranted. For a long-term perspective, here are the same two metrics spanning five decades
U.S. economy loses momentum despite impressive headline growth: Kemp- - (Reuters) - The U.S. economy showed clear signs of slowing during the first three months of the year, despite a much higher than expected figure for headline growth in gross domestic product (GDP) reported on Friday. Real GDP expanded at an annualised rate of 3.2 percent in the first quarter, up from 2.2 percent in the previous three months, according to the advanced estimate from the U.S. Bureau of Economic Analysis. Headline growth was more than twice as fast as the 1.4 percent predicted by the Federal Reserve Bank of New York’s nowcast model as recently as April 19, and faster than the 2.7 predicted by the Atlanta Fed on April 25. But the details contained within the GDP report paint a much less healthy picture of the economy and confirm other indicators that suggest it continued to lose momentum at the start of 2019. Consumer spending grew at annualised rate of just 1.2 percent, down from 2.5 percent the previous quarter, and a recent high of 3.8 percent in the second quarter of 2018. Business investment in structures, equipment and intellectual property grew at a rate of just 2.7 percent, down from 5.4 percent the previous quarter, and a recent high of 11.5 percent in the first quarter of 2018. Inventory accumulation boosted headline GDP by 0.65 percentage points as businesses accumulated a large volume of extra raw materials, work in progress and unsold goods in the first three months of 2019. But large inventory changes are normally reversed within a few months, so inventory reductions are likely to act as a drag on the headline growth rate in the next quarter or two. Foreign trade also boosted headline growth by an unusually large 1.0 percentage points, the third-largest contribution since the end of the financial crisis (https://tmsnrt.rs/2DyEXPK). But more than half of the contribution came from a sharp fall in imports, which accounting for almost 0.6 percent of GDP growth, the largest contribution since the fourth quarter of 2012 and before that the 2009 crisis. Imports normally only make a positive contribution to GDP growth when they decline during periods of sluggish growth or recession, so the sharp reduction raises concerns. The best gauge of the underlying momentum in the economy at home is the reported figure for real final sales to domestic purchasers, which excludes temporary inventory changes and erratic movements in foreign trade. Final sales to domestic purchasers rose at annualised rate of just 1.4 percent in the first quarter, the slowest rate for more than three years. Final sales to private domestic purchasers, which also excludes sales to the government and focuses only on consumer and business spending, was up by just 1.3 percent, the slowest rate for almost six years. The GDP report is consistent with other indicators, including freight movements and purchasing managers’ surveys, all of which show the rate of growth has decelerated sharply since the middle of 2018.
Endgame- Starting In 2024, All US Debt Issuance Will Be Used To Pay For Interest On Debt - While it is common knowledge that the US budget deficit is soaring even though the US economy is allegedly growing at a brisk, mid-2% pace, resulting in recurring bond trader nightmares about funding the growing twin US deficits (Budget and Current Account), what few people know is the increasingly ominous composition of this budget deficit. As we first pointed out one month ago, when looking at the US 'income statement', most concerning by far is that for the first four months of fiscal year 2019, interest payments on the U.S. national debt hit $221 billion, 9% more than in the same five-month period last year, with the rate of increase breathtaking (see chart below). As a reminder, according to the Treasury's conservative budget estimates, interest on the U.S. public debt is on track to reach a record $591 billion this fiscal year, more than the entire budget deficit in FY 2014 ($483 BN) or FY 2015 ($439 BN), and equates to almost 3% of estimated GDP, the highest percentage since 2011. It only gets worse from there. As part of today's Treasury Presentation to the Treasury Borrowing Advisory Committee, there is a chart showing the Office Of Debt Management's forecast for annual US debt issuance, broken down between its three component uses of funds: Primary Deficit, Net Interest Expense, and "Other."That chart is troubling because while in 2019 and 2020 surging US interest expense is roughly matched by the other deficit components in the US budget, these gradually taper off by 2024, and in fact in 2025 become a source of budget surplus (we won't be holding our breath). But what is the real red flag is that starting in 2024, when the primary deficit drops to zero according to the latest projections, all US debt issuance will be used to fund the US net interest expense, which depending on the prevailing interest rate between now and then will be anywhere between $700 billion and $1.2 trillion or more. In short: in the stylized cycle of the US "Minsky Moment", the US will enter the penultimate, Ponzi Finance, phase - the one in which all the new debt issuance is used to fund only interest on the debt - some time around in 2024.
Trump and Democrats agreed $2 trillion is needed for infrastructure, Chuck Schumer says - President Donald Trump and leading Democratic lawmakers agreed a plan to overhaul U.S. infrastructure would need $2 trillion, Senate Minority Leader Chuck Schumer, D-N.Y., said Tuesday. “We agreed on a number, which was very, very good,” Schumer said. Rebuilding the country’s aging infrastructure is one of the few bipartisan issues in American politics. Democrats and Republicans alike have stressed the importance of repairing and modernizing U.S. transportation, broadband, water and power projects, and both parties have submitted separate funding proposals to achieve those goals. Yet the issue has languished on Capitol Hill — and the Trump administration’s repeated attempts to refocus lawmakers through the label of “infrastructure week” have become a running joke in Congress. Schumer said “there was good will in this meeting” between the White House and Democrats — a tone that was “different than some of the other meetings we’ve had,” he added. At a previous meeting between Schumer, House Speaker Nancy Pelosi and Trump in December, the leaders openly clashed on camera over the president’s proposed border wall. Trump said at that meeting that he would be “proud” to shut down the government in pursuit of funding to build a wall along the U.S.-Mexico border. The government partially shut down less than two weeks later, and stayed that way for 35 days — the longest such interval in U.S. history. Schumer told reporters after the meeting Tuesday morning that there was no inherent conflict in working with Trump to pass infrastructure while, at the same time, Democrats in the House and Senate push forward in multiple investigations centered around Trump, his finances and his associates. “The two are not mutually exclusive and we were glad we didn’t make it that way,” Schumer said.
Dems want climate change, tax hikes in infrastructure deal -- The top two Democratic leaders on Monday told President Trump that any bipartisan infrastructure package needs to take into consideration climate change and include “substantial, new and real revenue” — a preview of the coming fight over tax hikes. Trump will host Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Charles Schumer (D-N.Y.) at the White House on Tuesday for discussions on a major infrastructure bill, one of the few policy areas that could see action amid divided government and as the 2020 race heats up. Democrats want the measure for roads, bridges, waterways and other projects to be paid for with tax increases, and with a final price tag of at least $1 trillion over 10 years. Trump’s fiscal 2020 budget calls for $200 billion in federal spending on infrastructure, which White House officials say will leverage an additional $800 billion in investment through public-private partnerships over the next decade. “America’s unmet infrastructure needs are massive, and a bipartisan infrastructure package must meet those needs with substantial, new and real revenue,” Pelosi and Schumer wrote in a letter to Trump on Monday. “We look forward to hearing your ideas on how to pay for this package to ensure that it is big and bold enough to meet our country’s needs.” The leaders laid out other Democratic priorities: Any deal must extend beyond traditional infrastructure projects, take into account climate change, include “Buy America” provisions and provide jobs for a broad swath of workers. “A big and bold infrastructure package must be comprehensive and include clean energy and resiliency priorities," Pelosi and Schumer wrote. "To truly be a gamechanger for the American people, we should go beyond transportation and into broadband, water, energy, schools, housing and other initiatives. We must also invest in resiliency and risk mitigation of our current infrastructure to deal with climate change." “A big and bold infrastructure plan must have strong Buy America, labor, and women, veteran and minority-owned business protections in any package," they added. "This bill can and should be a major jobs and ownership boost for the American people – manufacturers, labor contractors, and women, veteran and minority-owned businesses.” Pelosi told reporters earlier this month that an infrastructure package "has to be at least $1 trillion. I’d like it to be closer to $2 trillion."
The New ‘Infrastructure Deal’ Is Why We Can’t Have Nice Things -- It’s “Infrastructure Week” again. And this time around, the president’s quest to fix our nation’s crumbling roads and bridges — or look like he’s trying — actually has a bit of traction. On Tuesday, Donald Trump had a bizarrely constructive meeting with the Democratic congressional leadership, wherein both sides agreed that the federal government should make a $2 trillion investment in America’s infrastructure. No details were sweated. And over the ensuing 24 hours, congressional Republicans have blanched at the policy’s price tag, while some Democrats have insisted that new spending must be paid for by rolling back Trump’s tax cuts on high-earners. Nevertheless, some observers might take heart at the mere existence of bipartisan negotiations over how to address a genuine policy challenge. But they shouldn’t. The new round of infrastructure talks does not exemplify what’s still “working” in Washington; rather, it embodies three of the biggest problems in American politics today. Earlier this week, Chuck Schumer announced that he wouldn’t evenconsider supporting a hike in the gas tax — the traditional mechanism for funding highway improvements — until Republicans agreed to pare back some of the tax cuts they showered on the wealthy and corporations in 2017. Having put their party’s idea for how to finance an infrastructure package on the table, Democrats now insist that the president tell them whose taxes he would like to raise instead. And Trump almost certainly won’t do that — because his party will not let him propose taxes on the wealthy, and his political acumen won’t allow him to call for tax hikes on the middle class. If the GOP were a political party devoted to maximizing its vote share — without betraying its voting base — it would see Schumer’s pay-for demand as a wet kiss, not a poison pill. But the GOP is not such a party. Its overriding priority is to concentrate economic power in the hands of its largest shareholders. So it refuses to support popular legislation that would cost rich people money — even when doing so would aid a majority of Republican voters, and increase the party’s prospects for winning elections. As a result, the party must rely on obscuring the material implications of its agenda by stoking conservative social alienation and white racial paranoia. Which is the main reason why our republic can’t have nice things.
How Far Can We Push Fiscal Spending in Light of MMT? Some Optimistic Reflections on the Potential For Economic Experimentation - Readers are probably aware that there is quite a lot of discussion of Modern Monetary Theory (MMT) and the potential for fiscal experimentation batting around at the moment. Others have weighed in on this already, and I have little to add. It is striking, however, that most of the push-back — where there is push-back — is not focused on trying to discredit the idea that we should engage in fiscal experimentation. Indeed, the notion that we should engage in fiscal experimentation seems to be, if not mainstream, at the very least part of the discussion. Yet, vulgar strawman-style arguments against MMT aside, no one seriously disputes the fact that if too much fiscal expansion is undertaken the economy will eventually hit a hard inflation barrier, past which any increase in spending will generate inflation rather than real output expansion. Interestingly, no one seems to have tried to come up with a new framework for estimating where this inflation barrier might be and whether it is too risky to overshoot it. So, I’ve decided to fill that gap. Linked below is a paper where I use a new capacity utilisation-based framework to provide hard, yet optimistic numbers of how far we might push the economy in the spirit of fiscal experimentation.
Dalio Says Something Like MMT Is Coming, Whether We Like It Or Not - Central banking as we know it is on the way out, and it’s “inevitable” that something like modern monetary theory will replace it, billionaire investor Ray Dalio said. The doctrine, known as MMT, says that governments should manage their economies through spending and taxes -- instead of relying on independent central banks to do it via interest rates. It also seeks to allay fears over budget deficits and national debts by arguing that countries like the U.S., which have their own currency, can’t go broke and have more room to spend than is usually supposed -- provided inflation is subdued, as it is now. Debate over MMT, which languished in obscurity for decades, has exploded in recent months. The idea has been criticized by a series of financial heavyweights, from Warren Buffett to Federal Reserve Chairman Jerome Powell. But Dalio, the founder of Bridgewater Associates, the world’s biggest hedge fund, said policy makers will have little choice but to embrace it. Their challenge will be “to produce economic well-being for most people when monetary policy does not work,” Dalio said in his latest LinkedIn post. Read the full essay here. Over the past four decades, the era of central-bank dominance, income and wealth inequality has surged in most developed nations. Cutting interest rates, or buying securities in the process known as quantitative easing, have almost exhausted their ability to stimulate economies, he wrote. They’ll likely be replaced by a third-generation monetary policy, which Dalio labeled “MP3.’’ It will involve “fiscal and monetary policy coordination” along the broad lines suggested by MMT economists, he said, though not necessarily following their exact prescriptions. The shift is well under way, Dalio said. With interest rates pinned near zero in Europe and Japan, and likely to head back there in the U.S. when the economy falters, the fiscal-policy takeover is “by and large what has been happening” already. The U.S. ramped up budget deficits after the 2008 crisis, and has been doing so again under President Donald Trump. The bond-market response has supported MMT arguments: yields on government debt haven’t risen much, even though there’s much more of it around.
Senate Has a Duty to Denounce MMT, Republicans Say in Resolution - Five Senate Republicans want Congress to denounce Modern Monetary Theory, a doctrine gaining fans among progressive Democrats, as a menace to the U.S. economy. The theory, invoked by Democratic Representative Alexandria Ocasio-Cortez of New York -- and the subject of fierce debate among thinkers on Wall Street and beyond -- would result in bigger budget deficits and higher inflation, according to a non-binding resolution. It was backed by five Republican senators led by Georgia’s David Perdue, a former chief executive officer of Dollar General Corp. MMT says countries that print and borrow in their own currency, like the U.S., can’t go broke and don’t need to worry too much about budget gaps when inflation is subdued, as it is now. The idea has been cited by progressives as a way to pay for programs like the Green New Deal. It’s been attacked as a recipe for hyperinflation by a series of financial heavyweights. And some investors and economists, from Olivier Blanchard to Bill Gross and Ray Dalio, have taken more nuanced views and sided with some elements of the theory. Nobel laureate Paul Krugman has been among the critics. But he pushed back against the Republican move on Twitter Friday.Since the recession a decade ago, the U.S. budget deficit has expanded under both Democratic and Republican leadership. It was shrinking when President Donald Trump came to power, but he’s presided over tax cuts and spending increases that reversed the trend, taking the shortfall to about 3.9 percent of gross domestic product last year.The looser fiscal policy has helped accelerate the U.S. economy under Trump. His economic team says faster growth will eventually enable the government to recoup revenue lost to the tax cuts. Democrats say that’s an old supply-side argument that’s been empirically disproved, though they’re split over whether the U.S. should try to reduce the deficits, or just spend them differently.
Workers barely benefited from Trump’s sweeping tax cut, investigation shows - Big companies drove Donald Trump’s tax cut law but refused to commit to any specific wage hikes for workers, despite repeated White House promises it would help employees, an investigation shows.The 2017 Tax and Jobs Act – the Trump administration’s one major piece of enacted legislation – did deliver the biggest corporate tax cut in US history, but ultimately workers benefited almost not at all.This is one of the conclusions of a six-month investigation into the process that led to the tax cut by the Center for Public Integrity, a not-for-profit news agency based in Washington DC.The full findings, based on interviews with three dozen key players and independent tax experts, and analysis of hundreds of pages of government documents, are published today in an in-depth piece.The tax hike was sold to citizens as a move that would boost the economy, add jobs and hike wages. The president said in one speech that it would bring the average American household “around a $4,000 pay raise”. Seizing on that, the Communications Workers of America, a 700,000-member union, asked eight major corporations to sign a pledge to hike worker wages by $4,000 a year if their tax rate was cut to 20%, the initial proposed rate. The companies balked and signed nothing.The bill signed into law by Trump on 22 December 2017 cut the corporate tax rate from 35 to 21%, the largest such rate cut in US history. “The most excited group out there are big CEOs,” said the White House economic adviser Gary Cohn as the measure was making its way through Congress in 2017.But the fears of ordinary workers in regard to those promised higher wages were realized.The bulk of the $150bn the tax cut put into the hands of corporations in 2018 went into shareholder dividends and stock buy-backs, both of which line the pockets of the 10% of Americans who own 84% of the stocks.Just 6% of the tax savings was spent on workers, according to Just Capital, a not-for-profit that tracks the Russell 1000 index.
Iran Appeals Directly To Trump- Your Advisers Dragging You Into War - Iranian Foreign Minister Mohammad Javad Zarif told Chris Walls on Fox News Sunday that he believes President Trump's own advisers as well as Middle East allies like Saudi Arabia and Israel are “dragging the United States into a conflict” with Iran. It comes just days after Zarif made similar statements about the possibility of US and Iranian ships clashing in the Persian Gulf, warning that a false flag "accident" scenario could "lure" Trump into war — something which he thinks Trump himself doesn't want to see happen. It appears Tehran's new strategy as it reels from the sanctions squeeze on oil and Trump ending the crude export waiver program is to try and delicately peel Trump away from the American 'deep state'. Zarif specifically named National Security Advisor John Bolton, Israel, Saudi Arabia, along with close Saudi ally the United Arab Emirates, all as seeking to escalate tensions leading toward a regime change war on Iran. Wallace asked if they’re “all trying to exercise regime change?” according to Fox, and Zarif responded, “at least, at least.” Iran's top diplomat explained: “They have all shown an interest in dragging the United States into a conflict. I do not believe that President Trump wants to do that, I believe President Trump ran on a campaign promise of not bringing the United States into another war. But I believe President Trump’s intention to put pressure, the policy of maximum pressure on Iran in order to bring Iran to its knees so that we would succumb to pressure, is doomed to failure.”Iranian Foreign Minister says 4 key leaders are trying to drag Trump into a conflict with Iran pic.twitter.com/lIAWviy88z— FoxNewsSunday (@FoxNewsSunday) April 28, 2019Interestingly, it appears Zarif is attempting a direct appeal to Trump and the generally non-interventionist "bring the troops home" stance he campaigned on in 2016. Tehran's leaders could be hoping for a Kim Jong Un style approach to Trump. Trump's North Korea opening over the past year was marked by a series of off the cuff personal appeals and communications that led to one-on-one dialogue and thawing of tensions.
How Trump's hawkish advisors won debate on Iran oil sanctions (Reuters) - U.S. President Donald Trump’s unexpected decision to ban all Iranian oil purchases after May 1 - ending exemptions for eight nations - came after hawkish economic and security advisors allayed the president’s fears of an oil price hike, according to three sources familiar with the internal debate. The unprecedented move to fully sever Tehran’s financial lifeline - finalized just days before the April 22 announcement - underscores the influence of hard-liners within Trump’s National Security Council, which two of the sources said were the biggest advocates for the decision. They had for months argued for tightening the sanctions over the objections of State Department officials who favored allowing some partners and allies to keep buying Iranian oil. “No one’s actually tried to take this all the way to zero,” a senior administration official told Reuters, adding that forging a consensus among government agencies required “a lot of work.” President Donald Trump has been eager to halt Iran’s oil exports since slapping sanctions on the Islamic Republic last November for the first time since 2015, a move intended as punishment for Iran’s nuclear ambitions and its support of armed militant groups in the Middle East. But he initially backed a go-slow approach, providing waivers to allies and trading partners such as China, India and Turkey. The United States currently removes about 2 million barrels of oil per day from the world’s supply through sanctions on the Iran and Venezuela industries. But Washington hopes that soaring U.S. oil production - now at an all-time high of more than 12 million barrels per day - will keep global markets well-supplied and hold prices down. By the weekend of April 20, with the initial 180-day waivers given to countries due to expire May 1, top economic and security advisors convinced Trump that the time had come to cut off Iranian oil exports completely, according to the sources, who spoke on condition of anonymity. The National Security Council played a key role in driving the argument to end the waiver program - especially Richard Goldberg, a new member of the Trump administration and a longtime advocate for confronting Iran, according to the two sources. He was “instrumental,” one of the sources said. National Security Adviser John Bolton added Goldberg to the NSC in January.
Saudi Crown Prince Offered Abbas $10 Billion to Accept Trump’s Peace Plan: Report— Saudi Crown Prince Mohammed bin Salman offered Palestinian Authority leader Mahmoud Abbas $10bn to accept a controversial US-backed peace plan, Lebanese newspaper Al-Akhbar has reported. Abbas rejected the offer, saying supporting US President Donald Trump’s “deal of the century” would be “the end of his political life”, the paper reported on Tuesday, citing leaked diplomatic reports based on conversations between the two leaders. According to Al-Akhbar, the reports were written by Jordanian envoy to Ramallah Khaled al-Shawabkeh and were based on briefings with a number of Palestinian officials in Ramallah. The reports date back to December 2017 and January 2018 in the aftermath of Trump’s controversial declaration that the US considered Jerusalem to be the capital of Israel and planned to move its embassy there. They were written by Shawabkeh following discussions with Palestinian officials. In a 4 January 2018 report cited by Al-Akhbar, Shawabkeh wrote to the Jordanian foreign ministry and said that Abbas was “upset” by several offers he had received during a visit to Saudi Arabia the previous month, but had refused to discuss them with Palestinian officials. One of the Saudi offers, according to the Jordanian’s report, was to exchange Palestinian recognition of Trump’s deal for $10bn to assist West Bank authorities and refugee resettlement, along with “unlimited financial and political support”. According to Al-Akhbar, Mohammed Bin Salman asked Abbas how much his entourage’s annual budget was. “I am not a prince to have an entourage,” Abbas reportedly responded. “How much does the PA and its ministers need?” Bin Salman then said. “One billion US dollars,” Abbas replied, to which MBS was said to have responded: “I will give you $10bn over ten years if you accept the deal.”
Historic Bill in Congress Would Prevent Israel From Using US Aid to Detain Children— Veteran Congresswoman Betty McCollum introduced legislation Wednesday that would prohibit US funding to any foreign military that detains children, including Israel, Anadolu reports. The bill would additionally authorize the creation of an annual $19 million fund to support non-governmental organizations that monitor rights abuses pertaining to the Israeli military’s detention of children. “Israel’s system of military juvenile detention is state-sponsored child abuse designed to intimidate and terrorize Palestinian children and their families,” McCollum said in a statement announcing the bill’s introduction. McCollum said Israel’s military detention of children “must be condemned,” adding that “it is equally outrageous that US tax dollars in the form of military aid to Israel are permitted to sustain what is clearly a gross human rights violation against children.”Roughly 10,000 children have been detained by Israeli security forces since 2000 and subjected to military court proceedings, according to McCollum’s bill. “Israeli security forces detain children under the age of 12 for interrogation for extended periods of time even though prosecution of children under 12 is prohibited by Israeli military law,” it says. It further goes on to note that Human Rights Watch reported in 2018 that Israel’s military “detained Palestinian children “often using unnecessary force, questioned them without a family member present, and made them sign confessions in Hebrew, which most did not understand.” McCollum’s bill faces an uphill battle in Congress where it is likely to face near-uniform opposition from Republicans and is unlikely to garner sufficient Democratic support to clear the House if Speaker Nancy Pelosi chooses to send it to the floor.
Trump’s “Deal of the Century” is a Hoax: Experts— US President Donald Trump’s “deal of the century”, a backchannel plan to reach peace between the Palestinians and Israel, is nothing but a mere “hoax”, experts believe.Since taking office in early 2017, Trump has been formulating the plan, along with senior adviser (and son-in-law) Jared Kushner and special Mideast envoy Jason Greenblatt.According to past statements by US Ambassador to Israel David Friedman, the scheme would give Israel parts of the West Bank which are considered “occupied territory” under international law. “The deal of the century is a pro-Israel colonial plan,” Rabab Abdulhadi of the San Francisco State University told Anadolu Agency on Sunday. “Peace means respecting the inalienable Palestinian rights and self-determination, allowing the Palestinians to decide their own future, giving refugees the right to return to their lands, eliminating racism and discrimination, and stopping all the abusive practices against the Palestinians.”“If you [US] don’t provide this, there will never be peace,” Abdulhadi said.She argued that Trump, Kushner and Greenblatt are all “pro-Israel, pro-racism, and pro-Islamophobia”, and added:This is a new attempt to divert, derail and liquidate the Palestinian cause…To confront this scheme, the Palestinians have to continue what they are doing; resistance. Details of the US plan are expected to be announced after the Muslim fasting month of Ramadan, which will start early next month.
'Microcosm of Everything Wrong With US Foreign Policy': Senate Fails to Override Trump Veto on Yemen - The Republican-controlled Senate on Thursday voted down an effort to override President Donald Trump's veto of the Yemen War Powers resolution.The bill—introduced by Sen. Bernie Sanders (I-Vt.)—would have ended U.S. support for Saudi Arabia's deadly bombing campaign in Yemen, which has created the world's worst humanitarian crisis. Trump vetoed the resolution last month. The Senate needed 67 votes to override the president's veto, but the final margin of Thursday's vote was 53-45. Every "no" vote was cast by a Republican. Seven Republicans joined Democrats in voting in favor of the veto override. In a statement after the veto override failed, Sanders vowed to continue working to end U.S. involvement in Yemen."The bad news today: we were unable today to override Trump’s veto regarding U.S. intervention in this horrific war in Yemen," said Sanders. "The good news: for the first time in 45 years, Congress used the War Powers Act to reassert its constitutional responsibility over the use of armed forces.""This is the beginning of a bipartisan process to take back our responsibility over these most important matters," Sanders added. "My likeminded colleagues and I, in a bipartisan fashion, will utilize all of the legislative tools at our disposal—including further use of the War Powers Act."Paul Kawika Martin—senior director for policy and political affairs at Peace Action—said that while Thursday's vote "marks the end of the road for the Yemen war powers resolution, it does not relieve Congress of its responsibility to act." "Successful or not, every congressional effort to end our involvement in Yemen puts more pressure on Saudi Arabia to end the war," Martin said in a statement. "At the same time, grassroots efforts to end U.S. involvement in Yemen are foregrounding a critical debate on our nation's foreign policy in Yemen and beyond
Trump Pushing to Label Muslim Brotherhood a Terror Group After Sisi Visit— US President Donald Trump is pushing for the Muslim Brotherhood to be labelled a terror group at the urging of Egyptian President Abdel Fattah Al-Sisi, who visited the White House earlier this month.“The president has consulted with his national security team and leaders in the region who share his concern, and this designation is working its way through the internal process,” White House press secretary Sarah Sanders said in an email.National security adviser John Bolton and Secretary of State Mike Pompeo reportedly already support the designation, but officials at the Pentagon and elsewhere have been opposed and have been seeking more limited action. A senior US official confirmed that President Al-Sisi had asked Trump to make the designation, which Egypt has already done, in a private meeting during a visit to Washington on 9 April.
U.S. Threatens Maduro Supporters After Russia and China Blast Plans to Overthrow Venezuelan President - The United States' top diplomat warned there would be consequences for foreign backers of Venezuelan President Nicolás Maduro after Russian President Vladimir Putin and Chinese President Xi Jinping reportedly blasted President Donald Trump's efforts to change the regime. Secretary of State Mike Pompeo told The Hill's Newsmaker Series event Monday in Washington that “Maduro is going to leave,” despite the efforts of those not recognizing the political challenge parliament speaker Juan Guaidó poses against him. Pompeo explained that recent U.S. sanctions against Cuba, an ardent supporter of fellow leftist-led Venezuela, were intended to show officials in Havana that “they will be in a far better place if they chose a different path” than backing Maduro. "We are making the same case to all the parties that are supporting Maduro, certainly the people inside his own military, his own army, the Cubans the next ring out, the Russians, but if you've been watching the news, the Iranians are providing support in Venezuela today as well, the Chinese too could do more," Pompeo said, calling on Beijing to instead back Guaidó.Over the weekend, the Chinese capital hosted a gathering of 150 nations and 90 organizations seeking to be part of China's $1 trillion Belt and Road Initiative, a diplomacy-via-infrastructure project designed to boost China's global economic footprint. Venezuela apparently came up during talks between Putin and Xi, both of whom “highlighted that it is totally unacceptable when anyone tries to topple authorities in a third country, attempting to use force and illegal international pressure against a sovereign state, in order to change the leadership there,” Kremlin spokesperson Dmitry Peskov told the Rossiya-1 outlet, as cited Sunday by the state-run Tass Russian News Agency.China, Cuba, Iran and Russia have all sent delegations to Venezuela in shows of solidarity with Maduro and to provide humanitarian assistance as his Latin American state undergoes an economic crisis.
Coup Attempt in Venezuela: What You’re Not Being Told - The turbulent situation that has been unfolding in Venezuela for the last few years reached new heights on Tuesday as opposition leader and self-declared “Interim President” Juan Guaidó attempted to wrangle power away from Venezuelan President Nicolas Maduro, in what many are calling an attempted coup. Early Tuesday morning, Guaidó gave a press conference declaring that he has the support of the Venezuelan people and military, and demanded that Maduro step down. Guaidó also called on Venezuelans to take to the streets and call for an end to Maduro’s reign as president. During the day’s events, cameras caught armored vehicles, reportedly belonging to the Bolivian military, running into crowds of protesters. Human Rights Watch (HRW) tweeted that 25 peopled were detained and dozens were wounded. HRW also noted that Venezuelan authorities shut down two international television channels and censored one radio station. “The regime should know that it will be held accountable for these abuses,” tweeted José Miguel Vivanco, Executive Director of HRW’s America Division. Meanwhile, Venezuela’s U.N. ambassador Samuel Moncada held a press conference stating that President Maduro has “defeated” opposition leader Juan Guaidó and his supporters. Moncada stated “the country is right now in a situation of perfect normality.” Moncada criticized U.N. Secretary-General Antonio Guterres for not supporting Maduro’s government against Guaidó. Moncada also attacked the United States for what he said was another example of their interventionist policies, singling out President Trump and Vice President Mike Pence for their support of Guaidó. “This is one of the most strange and weird situations we are in now, which the superpower of the world is the main rogue state going around, without care, destroying countries, invading countries, and threatening with the use of force,” Moncada stated.
Venezuela – Random Guyaidó’s New Coup Attempt Turns Out to Be A Dangerous Joke - The Random Guyaidó who the Trump administration tries to make president of Venezuela just launched another coup attempt against the government. He announced his intent in a series of tweets around 6:00 am local time (machine translated): […] Guaido also posted a short video which shows talking into the camera with some 30 soldiers standing behind him. Some members of the armed forces released Leopoldo Lopez, an opposition leader under house arrest since he, in 2014, organized violent protests against the government. Guaidó and López went to the La Carlota airforce base near Caracas. Lopez tweeted (machine translated): López is, like Guaidó, a creature of the U.S. of A. He was also involved in the 2002 coup attempt against then President Chavez. It is not clear if Guaido and Lopez entered the air base. A person from the government said they are only on a highway. A video posted by some TV station shows a platoon of armed and masked soldiers at a road block. The Venezuelan Minister for Communication Jorge Rodríguez says the coup will be defeated (machine translated): The Distibuidor Altamira is a highway exit near the affluent business and living district Altamira in eastern Caracas. Some, but not all, Internet access from/to Venezuela is disabled. The chief of the armed forces of Venezuela chimes in (machine translated): We reject this coup movement that seeks to fill the country with violence. The pseudo political leaders who have placed themselves at the forefront of this subversive movement, have employed troops and policemen with weapons of war in a public thoroughfare of the city to create chaos and terror News of the coup comes shortly after Reuters reports that the Blackwater founder Erik Prince is looking for money to set up a mercenary army to attack Venezuela: Prince sketched out a plan to field up to 5,000 soldiers-for-hire on behalf of Venezuelan opposition leader Juan Guaido, according to two sources with direct knowledge of Prince’s pitch. A person familiar with the administration’s thinking said the White House would not support such a plan. A short video and a photo show a few low rank soldiers on a highway bridge with a carton of bananas and a basket of machine gun ammunition. Besides one machine gun they are armed with normal rifles and pistols. They are marked with a blue armlet or masks as Guaidó supporters.
It Looks Like Another Failed US Coup in Venezuela - The imperialist neocons infesting the Trump administration, and the orange-faced joke of a president himself, may think they can invent their own reality through propaganda, as Bush’s “brain” Karl Rove used to claim about the Bush/Cheney administration, but when it comes to Latin America, they fail to realize how deeply the people of that continent loath and resent the US and its colonial-era Monroe Doctrine.The failure of the latest coup plotted so carefully in the war rooms of the White House, Pentagon and CIA was pre-ordained as soon as it became clear that Washington’s chosen puppet Juan Gerardo Guaidó Márquez was nothing more than a creation of theirs, meant to do the bidding of the plotters in DC.By the time Guaidó appeared on a bridge in Caracas flanked by the opposition leader Leopoldo Lopez, whom defecting Venezuelan soldiers had reportedly released from house arrest where he had been sentenced for fomenting violence, along with a handful of troops from one unit, many of whom, reportedly, had been tricked into showing up by their commanding officers, and who fled when they realized they were being asked to shoot at fellow soldiers of the Venezuelan military, Guaidó’s attempt to create a coup by televising a staged one was already collapsing around him. In short order, troops and officers who had supported Guaidó began entering foreign embassies like Brazil’s and Chile’s and Spain’s, seeking asylum. Opposition leader Lopez, who clearly recognized the coup had failed, left Guaido’s side quickly and, with his family, sought asylum in the Chilean embassy, later moving with them to the nicer and perhaps safer quarters of the Spanish embassy.
Erik Prince wants to use a private army to overthrow Venezuela's president - (Reuters) - Erik Prince - the founder of the controversial private security firm Blackwater and a prominent supporter of U.S. President Donald Trump - has been pushing a plan to deploy a private army to help topple Venezuela's socialist president, Nicholas Maduro, four sources with knowledge of the effort told Reuters. Over the last several months, the sources said, Prince has sought investment and political support for such an operation from influential Trump supporters and wealthy Venezuelan exiles. In private meetings in the United States and Europe, Prince sketched out a plan to field up to 5,000 soldiers-for-hire on behalf of Venezuelan opposition leader Juan Guaido, according to two sources with direct knowledge of Prince's pitch. One source said Prince has conducted meetings about the issue as recently as mid-April. White House National Security Council spokesman Garrett Marquis declined to comment when asked whether Prince had proposed his plan to the government and whether it would be considered. A person familiar with the administration's thinking said the White House would not support such a plan. Venezuela opposition officials have not discussed security operations with Prince, said Guaido spokesman Edward Rodriguez, who did not answer additional questions from Reuters. The Maduro government did not respond to a request for comment. Some U.S. and Venezuelan security experts, told of the plan by Reuters, called it politically far-fetched and potentially dangerous because it could set off a civil war. A Venezuelan exile close to the opposition agreed but said private contractors might prove useful, in the event Maduro's government collapses, by providing security for a new administration in the aftermath.
Mike Pence Confirms- 'We Are With' Coup Plotters in Venezuela - Vice President Mike Pence confirmed Tuesday that the Trump administration is firmly on the side of the coup plotters in Venezuela as violent clashes between the elected government and opposition forces led by Juan Guaido quickly escalated. "To Juan Guaido, the National Assembly, and all the freedom-loving people of Venezuela who are taking to the streets today in Operacion Libertad—Estamos con ustedes! We are with you!" Pence tweeted. "America will stand with you until freedom and democracy are restored. Vayan con dios!" To @jguaido, the National Assembly and all the freedom-loving people of Venezuela who are taking to the streets today in #operacionlibertad—Estamos con ustedes! We are with you! America will stand with you until freedom & democracy are restored. Vayan con dios! #FreeVenezuela — Vice President Mike Pence (@VP) April 30, 2019 Pence's affirmation of U.S. support for the ongoing coup attempt in Venezuela came just hours after Guaido—surrounded by heavily armed soldiers and armored vehicles—called for a military uprising against the government of President Nicolas Maduro. The U.S. Vice President's statement of support for the coup plot was echoed by U.S. Secretary of State Mike Pompeo and national security adviser John Bolton. Bolton, who has repeatedly threatened the elected Venezuelan government in the weeks leading up to Tuesday's attempted coup, urged members of the military to defect and join the side of the coup plotters.
Biden Sides With Trump, Bolton, and Pompeo in Backing Coup Effort in Venezuela - Despite progressive critics and anti-war voices speaking forcefully against the Trump administration's overt backing of the attempted coup d'état by rightwing opposition forces in Venezuela on Tuesday, 2020 Democratic frontrunner Joe Biden aligned himself with the White House by throwing his support behind the overthrow effort."The violence in Venezuela today against peaceful protesters is criminal," Bidentweeted on Tuesday. "Maduro's regime is responsible for incredible suffering. The U.S. must stand with the National Assembly & Guaidó in their efforts to restore democracy through legitimate, internationally monitored elections."But what Biden embraced as an effort to "restore democracy," many foreign policy experts—ones not willing to give the benefit of the doubt to people like national security advisor John Bolton, Secretary of State Mike Pompeo, and President Donald Trump—called something else entirely: a violent effort by Venezuela's rightwing elites, led by Juan Guaidó, to overthrow the elected government of President Nicols Maduro.In subsequent comments during a campaign stop, Biden called for "calm" in Venezuela but also repeated the White House position that Maduro is not—despite his win in last year's contested elections which the opposition largely boycotted—the legitimate leader of Venezuela:Biden wasn't alone among top Democrats. House Speaker Nancy Pelosi and others alsoexpressed support for the military uprising launched by Guaidó. For critics, however, one of the salient dynamics about Biden's announced support for the U.S.-backed coup in Venezuela in 2019 is what it suggests the former vice president has learned—or rather has not learned—about U.S. intervention (aka "meddling") in the affairs of foreign nations since his support for the U.S. invasion of Iraq in 2003.
US Will Take Military Action in Venezuela “If That’s What’s Required” - — Going a step beyond the “all options are on the table” platitudes consistently parroted by Trump administration officials, Secretary of State Mike Pompeo said Wednesday the U.S. is prepared to take military action in Venezuela “if that’s what’s required.”“The president has been crystal clear and incredibly consistent—military action is possible,” Pompeo said in an interview on Fox Business.Trump administration officials are “trying to do everything we can to avoid violence,” Pompeo said, even as the White House expressed unequivocal support for the “military uprising” led by Venezuelan opposition leader Juan Guiado.“In the event that there comes a moment—and we’ll all have to make decisions about when that moment is and the president will ultimately have to make that decision—he’s prepared to do that if that’s what’s required,” said the Secretary of State.Jodie Evans, co-founder of the anti-war group CodePink, denounced Pompeo’s remarks as an “outrageous threat.”“The team that brought you Iraq seems to thrive on death, destruction, and spending workers’ hard earned tax dollars,” Evans tweeted.In an appearance on MSNBC just hours after Pompeo’s interview, national security adviser John Bolton echoed many of the Secretary of State’s talking points while continuing to make the Orwellian claim that the coup the Trump administration is supporting in Venezuela is somehow not a coup.“If [Guaido] holds constitutional legitimacy as we believe, trying to take control of the government is not a coup, it’s his constitutional obligation,” Bolton told MSNBC‘s Andrea Mitchell. “The coup that we’re worried about in Venezuela may have already taken place through the insertion of tens of thousands of Cuban security forces.”As Common Dreams reported, progressive advocacy groups and lawmakers have condemned the Trump administration’s support for the attempted coup and urged the U.S. to stop interfering in Venezuela’s internal affairs. “Bolton, Pompeo (and Guaido) say they want a ‘peaceful transition,’ even while creating chaos in the streets and calling for a military coup,” Gerry Condon of Veterans for Peace wrote for Common Dreams on Wednesday. “In recent years, we have been overwhelmed by endless wars on multiple fronts. Will Venezuela be one more such war? No, we say. This will not stand.”
US escalates threat of military intervention in Venezuela - In the wake of Tuesday’s stillborn coup called by the US-backed and self-proclaimed “interim president” Juan Guaidó, the Trump administration has escalated its threats of a direct military intervention to realize its aim of regime change in Venezuela. US Secretary of State Mike Pompeo Wednesday told the Fox Business Network that US “military action is possible.” “If that’s what’s required, that’s what the United States will do,” Pompeo stated. The secretary of state’s language was the most direct and belligerent used by the US administration since its regime-change operation kicked off last January with Guaidó swearing himself in after being assured of US support by Vice President Mike Pence. The stunt was immediately followed by Washington’s recognition of the previously unknown right-wing politician as the “legitimate” ruler of Venezuela. While since then, Trump administration officials have incessantly declared that “all options are on the table.” Pompeo’s statement spells this threat out in no uncertain terms. His threat came as the US national security council, including himself, acting Defense Secretary Patrick Shanahan, Chairman of the Joint Chiefs of Staff Gen. Joseph Dunford, and National Security Advisor John Bolton, prepared to meet at the White House Wednesday afternoon in what amounted to a war council on Venezuela. Shanahan canceled a planned trip to Europe to remain in Washington to discuss the crisis besetting Washington’s regime-change operation. Tuesday’s fiasco of a coup attempt was followed Wednesday by reduced crowds at what Guaidó had predicted would be the biggest demonstration in the country’s history. The numbers who turned out for a protest held in the wealthier area of eastern Caracas were overshadowed by a larger May Day rally organized by the government of President Nicolas Maduro.
Trump urges caution as Bolton and Pompeo tease a military intervention in Venezuela Trump has become frustrated this week as national security adviser John Bolton and others openly teased military options and has told friends that if Bolton had his way he'd already be at war in multiple places. Trump has long stated that "all options are on the table" when it comes to Venezuela, where embattled President Nicolas Maduro is clinging to power despite street protests and withering US sanctions. But aides have appeared to lean further into military options in recent days as an uprising led by opposition leader Juan Guaido, whom the US recognizes as the country's legitimate president, has failed to topple him. Secretary of State Mike Pompeo told a Fox News interviewer that "military action is possible. If that's what's required, that's what the United States will do." And Bolton has pressed the Pentagon for military options and told an interviewer this week the US would not allow Guaido be mistreated. But Trump, who has until now given Bolton wide leeway to manage the situation in Venezuela, appeared more cautious this week, privately expressing concern over how solid Guaido's plans are to take power and win support from Venezuela's military. Garrett Marquis, a spokesperson for the National Security Council, defended Bolton's work. "Bolton is executing the President's strategy of maximum pressure to achieve a peaceful transition to democracy in Venezuela. As President Trump himself has made clear, all options are on the table," Marquis said in a statement. The President's skepticism was sparked after the military uprising that Guaido and some US officials were counting on failed to gain steam — leading him to ask to questions about the reliability of US intelligence that suggested senior members of Maduro's inner circle were preparing to defect. In meetings throughout the week, Trump has pressed aides on how reliable the information coming from Guaido and Venezuela was and whether it was being interpreted properly, according to people familiar with the conversations. There was a very brief principals meeting at the White House on Wednesday to discuss additional steps forward in Venezuela, but it only lasted around 10 to 15 minutes, a person familiar with the meeting said. Bolton attended the session, but Trump did not.
Venezuela – Guaidó Got Snookered – White House Starts Beating War Drums --Yesterday's failed coup attempt in Venezuela significantly hurt the Trump administration's international standing. It delegitimized its Venezuelan clients Juan Guaidó and Leopoldo López. After recognizing that their original 'regime change' plan failed (again) the White House starts to beat the war drums. That wasn't the plan:The Trump administration, which has backed Mr. Guaidó since he first challenged Mr. Maduro’s authority more than three months ago,clearly thought the day would unfold differently.There is no official explanation why the Trump administration believed that the comical coup attempt by Juan Guaidó and his master Leopolo López would work.There are signs though that the government of President Nicolas Maduro set a trap. Several people in the top echelon of the Venezuelan government gave false promises that they would join the U.S. proxy side. They snookered Guaidó into launching his coup to let him fail. A Washington Post wrap-up says that everyone expected important people to change sides: The chaos in Caracas indicated that, while a plan had been in motion, it may not have unfolded as anticipated. Announcements by senior Maduro officials that they were changing sides did not materialize, and the administration appeared increasingly concerned as it debated next steps. Earlier Tuesday, Bolton had told reporters that Trump is watching political developments in Venezuela “minute by minute.” Bolton also put unusual public pressure on individual Venezuela government officials to renounce Maduro and embrace the political opposition. .. “It’s a very delicate moment,” Bolton said. “The president wants to see a peaceful transfer of power,” which he added would be possible if enough military and government figures switch allegiances. ... In an apparent attempt to divide Maduro’s government, Bolton said senior officials, including Defense Minister Vladimir Padrino López, had been in secret talks with Guaidó, and he called on them to “make good on their commitments” to help oust Maduro.... Bolton called by name for three officials in Venezuela — the defense minister, the chief judge of the Supreme Court, and the commander of the presidential guard — to support Guaidó taking power. Everyone in Washington believed that significant figures in the Venezuelan government would change sides. They did not do so. Vladimir Padrino rejected the coup within an hour after Guaidó announced it. It seems that the Guaidó side got played by the Venezuelan Defense Minister and several other officials and officers. They seem to have promised to support Guaidó only to bait him into taking steps that would embarrass him.
Guaido Now “Worth More Dead Than Alive” to Washington’s Venezuelan Coup-Creators - — Venezuelan opposition leader Juan Guaido failed to kick-start a military uprising on Tuesday. After this fizzle, his life may be in danger from his own CIA backers, the director of the Ron Paul Institute argued in a debate. Daniel McAdams and Ron Paul, the former libertarian representative from Texas, discussed the repeated attempts by Guaido to oust Venezuelan President Nicolas Maduro with the backing from the US government. Despite all the efforts, Maduro remains in power, supported by many Venezuelans and in control of its military and police forces. McAdams pointed out that Guaido himself, with his record of failing to mobilize the protest against the Maduro government, could be a target for such a provocation. He has been a kind of a hapless figure so far. He calls for mass protests and no one shows up. I don’t think he realizes right now that he is actually now worth more dead than alive not only to the CIA, but also to his own opposition people. A shot in the crowd or something like that to take Guaido out. It might shock you, Dr. Paul, but the CIA is pretty good at this kind of things.
Violent Supporters of Juan Guaidó Attempt to Invade Venezuelan Embassy in DC - — Emboldened by the attempted military coup — and amidst the ongoing tenancy of the Embassy Protection Collective at Venezuela’s Washington embassy at the invitation of the legitimate government of Venezuela — opposition activists rallied on Tuesday, hurling racist and homophobic slurs at members of the Collective. On several occasions, they attempted to unlawfully break into the embassy and injure its protectors. MintPress News has been at the embassy in D.C. since Wednesday, recording livestream reports and publishing articles featuring the voices of activists on the front lines in the fight against US imperialism that seeks to overthrow the Democratically elected leader of Venezuela and install a right wing government friendly to US economic interests. As Venezuelan opposition leader Juan Guaidó attempted a military coup on Tuesday, pro-opposition activists gathered in far greater numbers outside of the embassy in Washington. MintPress News observed numerous uses of slurs against embassy protectors and multiple instances of violence.In addition to the sexism, racism, and homophobia displayed by the opposition, embassy protectors also complained of being mocked for their age and body weight. Oppositions figures leading the protest on megaphones used terms like “marica,” and “maricon,” which are Spanish terms for “faggot.” Similarly, pro-Guaidó protesters with megaphones chanted calls for embassy protectors and journalists to kill themselves, in addition to hurling insults about their mothers. MintPress News’ reporter inside the embassy was also encouraged to commit suicide, threatened, and shown many a middle finger.
Peace Activists Arrested While Trying to Deliver Food and Medicine to Blockaded DC Venezuelan Embassy - Peace activists were arrested at the Venezuelan embassy in Washington, D.C. Thursday while trying to deliver food and medicine to members of the Embassy Protection Collective who are blockaded inside. The collective is made up of peace activists from groups including CodePink, Popular Resistance, and others. They have lived at the embassy for weeks, at the invitation of Venezuelan President Nicolás Maduro, who remains in power despite a U.S.-backedcoup attempt led by opposition leader Juan Guaidó.The activists the embassy hope to prevent Secret Service and D.C. police from helping the opposition, including Guaidó-appointed ambassador Carlos Vecchio, from taking over the property, which is legally under Maduro's authority.This week, as tensions ramped up in Venezuela and members of the Trump administration doubled down on threats of U.S. military intervention to force out Maduro, "opposition supporters began to gather outside the embassy, shouting racial and sexist slurs and attempting to violently charge at members of the collective protecting the front and back entrances," according to CodePink.By blocking access to the embassy, Guaidó supporters prevented food and medicine from reaching those inside. On Thursday, as CodePink co-director Ariel Gold "was throwing the food onto the balcony, she was tackled to the ground by an opposition member and both were arrested by the police," the group said in a statement. "Another CodePink activist began throwing more food up and was then arrested." Journalist Alex Rubinstein has reported from the embassy in recent days as opposition supporters have tried to break in to the building. He wrote Wednesday for MintPress News that "the violence and bigotry of the opposition has made the embassy protectors even more resolute in their cause," and shared videos from the scene on Thursday:
The Tragedy of Venezuela is the Tragedy of the US - Lawrence Wilkerson - Knowing what I know about my own administration’s attempt to unseat Venezuelan President Hugo Chavez in 2002, I was not surprised when the effort was recently renewed by the Trump Administration, particularly when such arch-defenders of Latin American rights as Elliott Abrams, Marco Rubio, and Rick Scott – not to mention John Bolton – began to appear on the White House payroll. Knowing as well that Trump did not give a farthing for what happened in Venezuela but was concentrated on what he is always focused on, domestic politics, I knew these underlings would be allowed to cry havoc and let slip the dogs of war in Venezuela so long as doing it secured Florida’s electoral votes for Trump in 2020. What I did not know – but looking back to 2002, should have – is how utterly incompetent the CIA would be in pulling off the “soft coup d’etat” that its leaders promised Trump. The events of the past 48 hours have demonstrated that incompetence markedly, as well as the real motivations of Trump’s lackeys on Venezuela, from the shrimp-lusting-after-Cuba Marco Rubio to the bombastic former governor of Florida Rick Scott, to the pardoned criminal Abrams, to the supine and totally incompetent Juan Guaido and his backer, Leopoldo Lopez in Caracas. What a crew the GOP can muster! And they just might have let slip the dogs of war. And they let them slip into a potentially first-class disaster – just like Somalia in 1992, Iraq in 2003, Libya in 2011, Syria in 2012, Afghanistan today and yesterday, and on and on.
Trump: "Had Very Productive Talk" With Putin, "We Discussed Trade, Venezuela... And Russian Hoax" - President Trump on Friday spoke with Russian President Vladimir Putin for the first time since the release of the Mueller report. The two spoke on the phone for more than an hour, discussing the Mueller report, Venezuela, North Korea and other matters, according to White House Press Secretary Sarah Sanders. On the Mueller report, Sanders said "both leaders knew there was no collusion," adding that their discussion on the matter was brief, according to CNBC. The two world leaders have spoken via phone over six times, according to official readouts from the White House. Putin said last year that the two spoke "regularly," according to the report. The discussion between the two leaders comes amid a tense political standoff in Venezuela. Opposition leader Juan Guaido has escalated his calls in recent days for a mass uprising, with the backing of the United States, against Russian-supported leader Nicolas Maduro. The two countries have warned each other against intervention –CNBC "This is our hemisphere," said National Security Adviser John Bolton on Wednesday. "It’s not where the Russians ought to be interfering." Trump’s “primary focus” during the call was on “making clear that the United States stands with the people of Venezuela” and ensuring they have access to food, water and medical supplies, according to Sanders. Top U.S. officials earlier this week blamed Russia for foiling a plan force Maduro out from leading the South American country to make way for Juan Guaidó, whom the U.S. and dozens of other nations recognize as Venezuela’s interim president. -The Hill Meanwhile, Russian Foreign Minister Sergei Lavrov issued a warning to US Secretary of State Mike Pompeo that US intervention in Venezuela would violate international law and could lead to grave consequences, according to Reuters. Trump also discussed a possible extension of an existing nuclear arms-control deal between the two countries by brokering a new deal involving China, said Sanders. To that end, Trump has directed his staff to begin work on a new trilateral nuclear agreement with Russia and China, according to the Washington Post. The current US-Russia stragtegic arms deal - START - will expire in 2021. Update: shortly after the conversation, Trump himself decided to chime in saying that he "had a long and very good conversation with President Putin of Russia. As I have always said, long before the Witch Hunt started, getting along with Russia, China, and everyone is a good thing, not a bad thing. We discussed Trade, Venezuela, Ukraine, North Korea, Nuclear Arms Control and even the “Russian Hoax.” Very productive talk!"
Trump invites far-right Hungarian leader Viktor Orban for talks in Washington - Donald Trump has invited Hungary’s far-right leader Viktor Orban to Washington for a “working meeting”, according to a Hungarian government spokesman. Zoltan Kovacs tweeted on Thursday night that the country’s prime minister will travel to the US for formal talks with the US president on 13 May. He said the pair would discuss energy security, defence cooperation, bilateral relations and regional security, explaining that the trip had been confirmed by Hungary’s foreign minister. Mr Orban became the first national leader in the EU to endorse Trump in the 2016 election campaign. Taking office in 2010, he has made anti-immigration measures his main focus in recent years, becoming a role model for many of Europe’s far-right parties. His ruling Fidesz Party was suspended from the mainstream centre-right European People’s Party (EPP) group in the European Parliament in March over its record on respect for the rule of law, freedom of the press and minorities’ rights.
Global military spending tops $1.8 trillion, highest on record --Global military spending has reached a new post-Cold War high, topping $1.8 trillion in 2018, according to an annual report published this week by the Stockholm International Peace Research Institute (SIPRI). This marks a 2.6 percent increase over the previous annual record for worldwide military expenditures in 2017.Most notably, US military spending increased by 4.6 percent in 2018, to $649 billion, the first annual US spending hike recorded by SIPRI since 2011. This trend is set to continue, with President Donald Trump having signed a $686 billion budget for 2019 and requesting $718 billion for the Pentagon in 2020. The Congressional Budget Office projects that if current funding trends continue, the US will spend $7 trillion on its military over the next decade, equivalent to the amount which will be spent on education, infrastructure and public health programs combined. The Trump administration is expending immense sums to modernize and develop the US arsenal to prepare for “great power conflicts,” with China and Russia first among its targets. The Pentagon expects to spend $500 billion over ten years in modernizing all aspects of its nuclear triad—intercontinental ballistic missiles, submarine-launched ballistic missiles and strategic bombers—including the development and deployment of more “usable” low-yield nuclear missiles.With its continued aim of global dominance, even as its economic position continues to decline, US imperialism far outpaces allies and enemies alike in military spending. In 2018, the US spent more than two and half times the amount of economic rival China ($250 billion) and more than ten times that of the supposedly great menace Russia ($61.4 billion). All told, the US spent as much as the next eight countries combined, accounting for 36 percent of the world’s military spending. This immense military buildup is being carried out with the support of all factions of the political establishment, without even a whiff of protest. In fact, the Democratic Party’s main critique of Trump has been from the right, demanding an even greater military buildup and a more aggressive posture toward Russia.
US And China Drive Global Arms Spending To New Post-Cold War High - Perhaps signaling a dangerous return to a 'new Cold War' — as some Russia scholars have recently called it — a just published study has revealed last year's global military expenditure reached its highest level since the end of the Cold War, according to Reuters, and shows ratcheting competition for arms buying between the United States and China. The finding is based on the latest arms spending figures from the Stockholm International Peace Research Institute (SIPRI), which announced in its annual report that total global military spending reach $1.82 trillion in 2018, up 2.6 percent on the previous year. The think tank identified the hugely significant increase, the highest global spending has been since 1988 — in the last few years of the Soviet Union's existence — as driven fundamentally by increased spending in the United States and China. Specifically US military spending was up 4.6% last year at $649 billion, and China, led by President Xi's desire to rapidly modernize the People's Liberation Army (PLA), spent 5% more on arms compared to the prior year, as Reuters notes, an increase for the 24th consecutive year. Per data from the SIPRI report: U.S. military spending rose 4.6 percent last year to reach $649 billion, leaving it still by far the world’s biggest spender. It accounted for 36 percent of total global military expenditure, nearly equal to the following eight biggest-spending countries combined, SIPRI said. China, the second biggest spender, saw military expenditure rise 5.0 percent to $250 billion last year, the 24th consecutive annual increase.
Trump’s Demolition Of Arms Control - The damage to U.S. security interests that is likely to linger well beyond the term of Donald Trump includes major setbacks to arms control. Several characteristics of the current administration’s way of operating contribute to this result. One is the priority the president gives to embellishing his self-styled image as a deal-maker, as distinct from achieving practical results. Related to that is a penchant for disparaging or destroying the accomplishments of previous administrations rather than building on them. Add to that a short attention span, a preference for grand gestures over long-term diplomatic work, and an urge to throw bones to the president’s domestic political base regardless of the overseas consequences. A further complication is the president’s vulnerability to manipulation by advisors with ideas that are firmer than, and agendas that are different from, his own. This is especially true of National Security Advisor John Bolton, who seems never to have met an arms control agreement that he liked or a war that he didn’t. The overall negative impact on arms control makes the world, and Americans, less safe than they otherwise would be.
Huawei tech would put UK-US intelligence ties at risk, official says- A US official has warned that the UK’s leaked proposal to adopt Huawei technology for 5G mobile phone networks risks affecting intelligence cooperation with the US, prompting further criticism from Conservatives opposed to the plan. Robert Strayer, a deputy assistant secretary at the US state department, said on Monday that Huawei “was not a trusted vendor” and any use of its technology in 5G networks was a risk, contradicting the British stance. The official said if an “untrusted vendor” was used by the UK or another western country, the US would “have to reassess the ability for us to share information and be interconnected” – implying that intelligence-sharing arrangements could be at risk. Last week, a tense UK national security council (NSC) meeting narrowly approved in principle allowing Huawei to supply “non-core” 5G technology, despite objections from five of the cabinet ministers present and months of US lobbying. The decision was leaked to the Daily Telegraph, prompting an inquiry in which ministers, advisers and officials will be interviewed, and which will probably lead to calls for the leaker to be sacked, regardless of their seniority. Westminster has been dominated by speculation about the identity of the leaker, with the focus on the five ministers who raised concerns about Huawei, including the foreign secretary, Jeremy Hunt, the home secretary, Sajid Javid, and the defence secretary, Gavin Williamson.
Mulvaney says China trade talks will be resolved ‘one way or the other’ within two weeks - The Trump administration should know more about whether it will sign a key trade deal with China within two weeks, White House chief of staff Mick Mulvaney said Tuesday. When asked about Treasury Secretary Steven Mnuchin’s suggestion that the White House could announce an agreement with Beijing in the next two weeks, the top Trump advisor said, “I think that’s fair.” “Someone asked me how long is the negotiation going to go on and I don’t have a specific answer to that,” he said at the Milken Institute Global Conference. “It won’t go on forever. I think at some point in any negotiation you realize: ‘OK: we’re close to getting something done so we’re going to keep going.’ On the other hand, at some point you just throw your hands up and say ‘you know this is never going to get anywhere.’” “I think you’ll know one way or the other in the next couple weeks,” he said. “I think that’s probably fair.” The White House has pushed for a deal to revamp its trade relationship with China and address concerns about trade deficits, intellectual property theft and forced technology transfers. While the Trump administration has shown optimism about striking an agreement and ending a potentially devastating trade conflict between the world’s two largest economies, final sticking points have tripped up talks. Investors have watched the negotiations closely, as success or failure in reaching a deal could affect a wide range of companies. Mulvaney stressed the U.S. would not accept an agreement with China unless it was a great deal. The two sides have appeared to disagree not only on whether the U.S. would lift its $250 billion in tariffs on Chinese goods as part of an agreement, but also on how to enforce provisions to crack down on what Trump has called Beijing’s trade abuses. Outside of his discussion about China, Mulvaney cast doubts on the Trump administration’s other major trade initiative: its replacement of the North American Free Trade Agreement. Congress so far has not moved to ratify the deal, dubbed the United States-Mexico-Canada Agreement, amid Democratic concerns about environmental and labor protections.
Original US-China Tariffs Now Major Obstacle In Trade Talks - Futures dipped after the Wall Street Journal reported that punitive tariffs exchanged between China and the United States are now posing a major obstacle in ongoing trade talks between the two nations. US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin resume high-level talks with China on Tuesday - which will be followed next week by their counterparts traveling to Washington next week for another round of talks which officials and business groups say could result in a deal. That said, "how and whether to remove the tariffs the two governments imposed in the earliest phases of the dispute are now at the forefront of the talks," according to the Journal, citing people briefed on the negotiations. At issue is how much of the tariffs the U.S. levied on $250 billion of Chinese goods will be removed, according to the people. The U.S. wants to leave some in place as a tool to enforce the agreement while Chinese negotiators see those tariffs as an affront, and negotiators have batted the issue back and forth for at least a month. -Wall Street Journal"The tariffs are the leverage to move the deal past the finish line," said Jake Parker, Vice President of the US-China Business Council in Beijing. "It’s natural the details of drawdown timelines would be among the last items negotiated." Aside from Tariffs, the negotiators are trying to find solutions in other areas - such as persuading Beijing to expand access to China's cloud computing market and agricultural markets, according to business and farm groups. Neither Mr. Lighthizer nor Mr. Mnuchin would comment on specifics as they walked past reporters after arriving in Beijing. Mr. Mnuchin said that the focus of this week’s talks is “broad” and that “we’ve made a lot of progress.” On Monday Mr. Mnuchin told Fox News that the enforcement mechanism still “needs a little bit of fine tuning” and that “if we get to a completed agreement, it will have real enforcement provisions.” -Wall Street Journal According to people familiar with Beijing, their primary concern is that the US continues to insist on imposing tariffs, while preventing China from retaliating in order to make sure Beijing fulfills commitments in a trade deal. "Beijing absolutely doesn’t want to give in on this," said one WSJ source, who noted that the tariffs would be an embarrassment for leadership and a tough sell to Chinese businesses and domestic counterparts. Investors are also taking note.
As US-China deal nears, Beijing relaxes rules for foreign banks and insurers, in concession to Washington - SCMP - China announced a dozen new measures on Wednesday to further open up its US$44 trillion financial sector to foreign banks and insurers in a clear move to comply with any deal with the United States to end the trade war. The announcement came while a US negotiating team headed by US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin were holding the latest round of talks in Beijing with Chinese counterparts led by Vice-Premier Liu He. While no details of Wednesday’s negotiations were forthcoming, Mnuchin told reporters upon leaving the meeting that they were “productive”. Hopes are high that a trade deal can be reached soon. “We hope within the next two rounds in China and in [Washington] DC to be at the point where we can either recommend to the president we have a deal or make a recommendation that we do not,” Mnuchin said in a taped interview broadcast on Fox News on Monday morning. The Chinese trade delegation is due to travel to Washington next week for another round of talks, which are expected to begin on Tuesday. The financial market opening measures announced by the China Banking and Insurance Regulatory Commission (CBIRC) on Wednesday appear to be an initial implementation of the expected agreement. Existing caps on both foreign and domestic single shareholders’ investments in local commercial banks will be removed. Foreign banks will be exempted from having minimum assets of US$20 billion by the end of 2019 to be able to apply to open a branch in China, according to the CBIRC notice. The CBIRC linked the market opening moves to China’s own domestic requirements rather than to the trade deal. This is being perceived as an effort to avoid any connection to potentially unpopular concessions to the US. The move is intended to support “China’s self-development needs for its economy and finance”, and will help to “stimulate market vitality and improve the management and competitiveness of the financial industry”, said Guo Shuqing, head of the CBIRC and party secretary of the Chinese central bank.
U.S.-China Trade Deal Unlikely to Address Cybertheft or Subsidies— Trade negotiations between the United States and China are entering the final stage, but a deal is expected to fall short of addressing several key Trump administration goals, including combating Chinese cybertheft and state subsidies at various levels of the Chinese government, officials from a leading American business group said on Thursday.President Trump has repeatedly insisted that a United States-China trade deal will address what he says is a pattern of China illegally gaining access to American computer networks. He has also said it will end economic practices like subsidies that the United States says gives China an unfair competitive edge.But Chinese negotiators have pushed back against discussing cybertheft in the context of the negotiations, arguing for the issue to be dealt with in a different forum, Myron Brilliant, the executive vice president and head of international affairs at the U.S. Chamber of Commerce, said on Thursday in a call with reporters.Mr. Brilliant said that outcome was “not a surprise.” China has long disputed American accusations that it systemically steals intellectual property from American companies, and Chinese officials have maintained that the country has kept the terms of a previous cybersecurity agreement it made in 2015 with President Barack Obama. The trade deal is expected to include renewed commitments from China to strengthen its protection of intellectual property, greater access to Chinese markets for firms in the automotive, banking, insurance and securities industries, commitments from China on increased transparency in how it manages its currency, and large purchases of American products, including soybeans and natural gas, among other provisions.But it is also unlikely to resolve American concerns about China’s industrial policy, including subsidies it provides to its industries. The text of the deal is expected to include some language on subsidy transparency, Mr. Brilliant said, referring to Chinese disclosures to the United States of the subsidies it provides to industries.
Beijing Warns Trade Talks Will Collapse If White House Doesn't Compromise - More cracks are forming in the White House's carefully-constructed narrative that trade talks could be headed for a resolution next Friday following the 11th round of talks between US and Chinese trade negotiations in Washington. After Beijing floated a report on Thursday suggesting that talks had been an impasse, sending stocks hurtling toward session lows early Thursday afternoon, they have followed up on Friday with a statement casting doubt on Washington's assertion that a deal is imminent. According to the South China Morning Post, the Communist Party has published what appears to be a warning to Washington and the investing public. The Communist Party warned in a post on Taoran Notes, a venue for publishing trade-talk updates for the Chinese public, that reports about a deal being reached next Friday were part of a pressure campaign to get Beijing to acquiesce to a deal, adding that this "smoke and mirrors" ploy wouldn't work."Taoran Notes, a social media account used by Beijing to release trade talk information and to manage domestic expectations, said the hints from the US side that next week’s 11th round of talks are a deadline is merely a trick “to increase tensions and generate pressure on the other side." "It’s the same tactic as the US threatening to raise tariffs, it is merely smoke and mirrors to exert extreme pressure [on China]," the post said. "You don’t have to take it seriously."
US and China will have many more battles to fight when the trade war ends - China and the United States appear closer than ever to an accord that would end their trade war but policymakers and investors are not popping any champagne. As Washington’s top trade negotiators prepare to meet their counterparts in Beijing on Tuesday amid expressions of confidence that China’s markets will further open up, many with stakes in the talks’ outcome are focused on other developments – like the US government’s recent moves against a Chinese company that owns a popular gay dating app. Rarely does a week go by without an announcement about US sanctions against Chinese companies, espionage investigations or warnings from lawmakers that the US military must prepare for a hot war with China. The trade deal that is likely to come within weeks will be barely enough to slow a less visible but more lasting clash. Many believe more serious conflicts between the two countries are just unfolding. “US-China relations have entered a competitive phase that goes well beyond trade disputes,” Richard Turnill, lead researcher at BlackRock, the asset management giant, wrote in a global outlook report this month. “Tensions have broadened to include technological, political, ideological and military dimensions – and we see them as long-lasting.” He warned investors against confusing “any trade truce with a detente in the overall relationship”.
Washington Is Dismissing China’s Belt and Road. That’s a Huge Strategic Mistake. — Last week, leaders and officials representing more than three dozen countries from across the world gathered in Beijing for the second Belt and Road summit. The event marks the two-year anniversary since China first convened its flagship initiative to coordinate trillions of dollars of infrastructure across Eurasia and the Indian Ocean in a broad effort to recreate the old Silk Roads. One nation that was missing from the summit: The U.S. The fashionable position in Washington today is to dismiss the Belt and Road Initiative (BRI) as a power play that won’t last—an attempt at neocolonial debt trap diplomacy, in which China uses unpayable debts to control less powerful states, that is ultimately destined to collapse under the weight of financially spurious projects. On the other hand, there are also those who view BRI as a serious threat—a sign of China’s continued quest for global hegemony and the presence of a new Cold War between the U.S. and China. Either way, the U.S. position so far has been to shrug at China’s new initiative. In this, Washington is making a grave mistake. Membership in BRI is growing, whether the U.S. comes to the table or not, and this past week’s Beijing gathering indicates that China is willing to accommodate the concerns of its partners to maintain momentum. Though American critics tend to see it either as a doomed scheme or a strategic threat, what’s really happening with the BRI plan is more complicated—and even offers the United States the chance of a payoff, regardless of China’s success. It is already opening new and expanding markets to American companies. And, diplomatically, it presents an opportunity to help steer countries clear of excessive dependence on China. Belt and Road, then, might well bring about the outcome least expected: a Eurasia that is more multipolar rather than less—if, that is, America engages rather than sitting on the sidelines. The BRI has already begun having effects across the region, and not always the ones China intended. It has catalyzed modernization drives from Pakistan to Myanmar, investments that can actually help countries diversify their economies and achieve investment grade status. At the same time, it has awakened countries to the dangers of taking on too much debt without delivering growth, and thus becoming ensnared in China’s political orbit. Importantly, this has given rise to a welcome “infrastructure arms race” in which Japan, India, Europe and even, belatedly, the U.S. are starting to actively compete with China to finance productive infrastructure and help BRI members to eventually resist Chinese dominance.
Trade war and sagging prices push U.S. family farmers to leave the field (Reuters) - Shuffling across his frozen fields, farmer Jim Taphorn hunched his shoulders against the wind and squinted at the auctioneer standing next to his tractors. After a fifth harvest with low grain prices, made worse last fall by the U.S.-China trade war, 68-year-old and his family were calling it quits. Farming also was taking a physical toll on him, he said; he’d suffered a heart attack 15 months before. It took less than four hours to sell off all the tractors, combines and other farm equipment at the Taphorn retirement sale, ending a family tradition that had survived nearly a century. Across the Midwest, growing numbers of grain farmers are choosing to shed their machinery and find renters for their land, all to stem the financial strain on their families, a dozen leading farm-equipment auction houses told Reuters. As these older grain farmers are retiring, fewer younger people are lining up to replace them. The trend has created boom times for the auction houses, which report that their retirement business has grown 30 percent or more over the past six months, compared to the same period a year earlier. But it is expected to put a strain on the agricultural supply chain: It means fewer customers for seed and chemical companies, fewer machine buyers, and fewer suppliers for grain merchants.
Wisconsin Dairy Farmers Going Bankrupt In Record Numbers, Blame Trump Tariffs - A perfect storm hit Wisconsin dairy farms: Overproduction, Bad Decisions, Trump's Tariffs. A trio of major errors hit Wisconsin dairy farmers, but the last one, Trump's tariffs, was the final straw threw many Wisconsin farmers into bankruptcy. Please consider Stung by Trump’s Trade Wars, Wisconsin’s Milk Farmers Face Extinction. For decades, Denise and Tom Murray rose before 5 a.m. and shuffled through mud and snow to milk cows on the farm that has been in their family since 1939. This month, after years of falling milk prices and mounting debt, the Murrays sold their last milk cow, taking pictures while holding back tears as the final one was loaded onto a truck and taken away.“It’s awful hard to see them go out the last time,” said Ms. Murray, 53. “It’s scary because you don’t know what your next paycheck is going to be.” Over the past two years, nearly 1,200 of the state’s dairy farms have stopped milking cows and so far this year, another 212 have disappeared, with many shifting production to beef or vegetables. The total number of herds in Wisconsin is now below 8,000 — about half as many as 15 years ago. In 2018, 49 Wisconsin farms filed for bankruptcy — the highest of any state in the country, according to the American Farm Bureau Federation. Trump pleads that it's short-term pain for long-term gain. But it's tough to see any long-term gain when the intermediate term is bankruptcy. The Murray's received all of $400 from Trump's farm aid package. “In every aspect, it’s not worth it — it’s not worth the fight,” said Mr. Murray. The price of milk is about where it was in mid-2010. The price has gone essentially nowhere since late-2014.The price of new equipment and services and have gone up. Trump's the trade wars were the final straw.
Bernie Sanders attacks Biden from the right on China trade - Vermont Senator and 2020 Democratic presidential candidate Bernie Sanders has attacked former Vice President Joe Biden for remarks on China and trade. In language that would not be out of place coming from President Donald Trump, Sanders accused Biden of downplaying the economic threat represented by China and criticized him for supporting the North American Free Trade Agreement (NAFTA) and the normalization of trade relations with Beijing.Biden, considered the early frontrunner for the Democratic Party presidential nomination, said at a campaign event Wednesday in Iowa, “China is going to eat our lunch? Come on, man.” He added, “They’re not bad folks. But guess what, they’re not competition for us.”Biden spokesman Andrew Bates later stated that the Biden had meant “it’s never a good bet to bet against America and the fundamental strength, resilience, and ingenuity of its people.”In a response the same day, Sanders criticized Biden from the right, saying in a tweet, “Since the China trade deal (in 2000) I voted against, America has lost over 3 million manufacturing jobs. It’s wrong to pretend that China isn’t one of our major economic competitors. When we are in the White House we will win that competition by fixing our trade policies.”Sanders’ crude economic nationalism is not new. He has long linked his populist rhetoric to policies of trade war and anti-immigrant chauvinism. He fully supports the efforts of the trade union bureaucracy to pit US workers against their class brothers and sisters around the world and infect American workers with nationalism—the better to subordinate them to “their” corporate exploiters within the US. Just two weeks ago, Sanders denounced “open borders” at a campaign event in Iowa, warning that decriminalizing undocumented immigrants would lead to “impoverished people” around the world flooding into the US.
Workers in Mexico just won the right to organize real labor unions. Trump helped. - May 1 is International Workers’ Day, and employees in Mexico have good reason to celebrate: They just won the right to organize and negotiate their own pay. Mexican President Andrés Manuel López Obrador enacted a labor reform bill Wednesdaythat for the first time gives workers the legal right to bargain collectively with employers through independent labor unions, without fear of retaliation or harassment. The bill sailed through the House of Representatives earlier this month, and senators unanimously passed the bill Monday. “This is a huge advancement for Mexico’s workers,” López Obrador said during his daily press conference Tuesday morning in Mexico City. “Before this reform, workers couldn’t vote freely, by secret ballot, to elect their union representatives. Now workers can choose.” It is indeed a huge victory for workers in Mexico, and ironically, US President Donald Trump helped them get it.As part of the new trade deal Trump negotiated with Mexico and Canada in November,known as the USMCA, then-Mexican President Enrique Peña Nieto promised to overhaul its labor laws. And Mexico’s new populist president, López Obrador, agreed.The USMCA, if approved by lawmakers in all three countries, would replace the current NAFTA deal, which Trump has long blamed for decimating the US manufacturing industry. The point of including labor reform in the new trade deal was to improve working conditions in Mexico, so that US manufacturers have less financial incentive to move factory jobs across the border. But not everyone in Washington is on board yet. Trump is getting resistance from US labor unions and House Democrats, who think the USMCA doesn’t do enough to make sure Mexico enforces its new labor laws. Regardless of what happens next, Mexican workers have already scored a major victory from the new trade deal.
Migrants on Border Face Confusion and Fear Under “Remain in Mexico” Policy – Minutes before being sent back into the federal government’s custody Thursday afternoon — and most likely back to Ciudad Juárez while his asylum case remains pending — Misael Acosta wanted to tell an immigration judge one last thing. “When I went to throw away some trash, I saw the body of a dead man” lying on the ground, he said in Spanish. Acosta, 25, was one of many asylum seekers who told Judge Nathan L. Herbert essentially the same thing: Under a new policy by the Trump administration, the violence they escaped in Central America has followed them to Mexico, where the U.S. government sent them. Acosta fled Honduras after criminal gangs and police officers threatened him and Katherin Molina, 22, the mother of their two daughters, they said. The family sought asylum at the El Paso port of entry in early April but was returned to Mexico the next day. They said they have been shuttled from shelter to shelter in Ciudad Juárez since. They were part of the wave of asylum seekers who have been returned to Mexico under the expansion of a controversial program called the Migrant Protection Protocols. The program, also known as “remain in Mexico,” began in California in January and was expanded to the El Paso ports of entries in March; it requires asylum seekers to wait in Mexico until their court dates before American judges. The program’s future is now in the hands of the 9th U.S. Circuit Court of Appeals. A federal judge in California temporarily blocked the program April 8, but a three-judge panel of the appellate court put that order on hold pending the Trump administration’s appeal of the ruling. That means that the Acosta family and the other 13 other migrants in the El Paso courtroom Thursday for their asylum proceedings will likely be sent back to Mexico and won’t be able to return until their next court date, May 31. Their only option for remaining in the U.S. until that date is to convince an American immigration officer that they shouldn’t be returned, but that’s rare, said Christina Garcia, who works at El Paso’s Las Americas Immigrant Advocacy Center.
Border agency builds migrant tent city in Texas as Trump likens treatment to 'Disneyland' - The US government has begun erecting tents close to the border with Mexico to house detained migrants – even as Donald Trump likened the treatment of undocumented families entering the US to “Disneyland” on Sunday. Life at the foothills of the Franklin mountains in El Paso, Texas has been rudely disrupted in the last few days by construction crews coming and going near the adjacent border patrol station. The main frames of two large tents popped up last week. They are expected to hold up to 500 migrants amid a level of chaos at the border that has unfolded under the Trump administration’s immigration policies. Construction crews are now working to prepare the interior of the shelter, which is expected to be operational by 1 May, even as the president downplayed conditions in which migrants are held and appeared once again to support the separation of families crossing the border. He told the Fox News show Sunday Morning Futures: “When they used to separate children, which was done during the Obama administration, with Bush, with us, with everybody, far fewer people would come, and we’ve been on a humane basis, it’s pretty bad.” He added to the host, Maria Bartiromo: “We go out and we stop the separation. The problem is you have 10 times more people coming up with their families, it’s like Disneyland now.” The Trump administration began separating thousands of migrant families last year whenever they crossed the US-Mexico border unlawfully, and detaining parents and children separately, under a “zero-tolerance” policy. Trump halted the policy last summer after widespread uproar, though in recent weeks, even as the government is being sued over the consequences, floated, then rejected again, the idea of resuming such actions. CBP said in a statement last week that the large number of arrivals had created a need to open up additional shelter space in order to continue to process migrants arriving at the border.
Pope Joins Soros In Funding Immigrant Caravan Invasion Of US Southern Border - In a move that many have interpreted as a shot across the bow of President Trump, Pope Francis has upped his globalist-leaning interventionism by donating $500,000 to help Central American migrants stranded in Mexico as they try to reach America. The money is from church collections from around the world and is intended to help 75,000 people who arrived in Mexico to find passage to America. RT reports that The Catholic Church's Peter’s Pence Fund said in a statement that aid to migrants by governments and private individuals has dropped as global media coverage of the crisis decreased. “All these people were stranded, unable to enter the United States, without a home or livelihood,” Peter’s Pence said. “The Catholic Church hosts thousands of them in hotels within the dioceses or religious congregations, providing basic necessities, from housing to clothing.”Many have interpreted this move as retaliation after Trump cut all aid to Guatemala, Honduras and El Salvador last month, accusing the Central American countries of not doing “a thing for us.” ‘Pope Francis donates $500G to migrants at U.S.-Mexico border’You’ve just been trolled... by the Pope. https://t.co/EqKd7mHC0z?— RynheartTheReluctant (@TheRynheart) April 28, 2019 But not everyone sees the Pope's intervention that way... Pope Francis recently spoke out against governments that build walls to keep out migrants, saying: “Those who build walls will become prisoners of the walls they put up.”
Lawsuit Aims to Curtail Warrantless Searches of Electronic Devices at US Border - New information obtained as a result of depositions and document discovery in an ongoing lawsuit should make anyone concerned about privacy seriously consider crossing the US border without carrying any electronics devices.Warrantless searches of electronics devices have nearly quadrupled at the US border since 2015, rising to 33,295 at the end of 2018. These are conducted for reasons broader than simple immigration or customs enforcement.Immigration and Customs Enforcement (ICE) policy allows border agents to search and confiscate anyone’s electronic device for any reason or for no reason at all. Customs and Border Protection (CBP) may conduct a search of a device at the border without a warrant or probable cause, and usually without even reasonable suspicion.What happens if you refuse to allow the search? Well, I hope you don’t have plans to meet anyone for dinner on the day you make that decision. The short answer is that the government would then simply choose to seize your device – and take its sweet time in getting it back to you. During that time, border agents – or anyone they may choose to hand it off to – can study your device anyway. There’s no sensible provision that would lockdown your device until a judge ruled on whether a warrant was necessary to search the device.The Electronic Frontier Foundation (EFF) and the American Civil Liberties Union (ACLU) moved for summary judgment Tuesday in a case originally filed against the Department of Homeland Security in September 2017 on behalf of eleven plaintiffs. (A roster of legal documents can be found here).The government moved to dismiss the claim, citing the “border search exemption”, arguing that the First and Fourth Amendments do not apply to its border activities. At some level, let’s say for the sake of argument, such an exemption may have made sense in the past, since in the pre-digital world, they only covered baggage and one’s person. If you could leave the border and take your bags with you, you would be able to dump the contraband border officials might have been concerned about. Now, with the invention of digital devices – and the government claiming the same set of rules apply – border officials can root around wholesale in all those aspects of one’s life that are stored there. No judge is ever even asked to rule on the scope or necessity of these fishing expeditions.
Homeland Security to Start DNA Testing Asylum Seekers as It Tries to Back Up ‘Fake Families’ Scare Tactic - The U.S. Department of Homeland Security will start using Rapid DNA tests on some asylum seekers at the U.S.–Mexico border next week, according to a new report from CNN. The tests are intended to determine whether adults and children who are traveling together are actually family members.The Rapid DNA tests involve a cheek swab and will be deployed at two ports of entry starting the week of May 6. Results from the test take about 90 minutes.These new Rapid DNA tests are supposed to catch immigrants who are lying about being related, but it’s unclear how DHS can establish familial ties through DNA alone. Obviously, DNA relations aren’t the only thing that define a family. President Donald Trump has often complained, without evidence, that asylum seekers are lying about the threats they face in their home countries. Trump has also accused asylum seekers of using children to get into the country and receive preferential treatment, despite the fact that children and adults alike face the same inhumane treatment in U.S. immigration processing centers. “Cases of ‘fake families’ are popping up everywhere. And children are being used as pawns,” former head of Homeland Secretary Kirstjen Nielsen said in a speech on March 18 without any evidence. “In fact, we have uncovered ‘child recycling rings’,” Nielsen continued. “Truly, child re-victimization rings, a process by which innocent children are used multiple times to help aliens gain illegal entry.” Last year, ICE warned of a “315 percent increase in the number of cases of adults with minors fraudulently posing as ‘family units’ to gain entry” from October 2017 to February 2018. While that sounds like a concerning surge, a Washington Post analysis found that figure to be wildly misleading. The raw numbers—46 alleged fraud cases in fiscal year 2017 compared to 191 in the first five months of the 2018 fiscal year—show that just 0.61 percent of the 31,102 family units apprehended at the border during that time period were believed to have been fraudulent. Immigration activists are concerned about the privacy implications of DNA tests, a tactic that has been floated many times over the past year. And families are sometimes torn apart by tests that may show a father is not the biological parent of a child, something that may be news to them both. But ICE is defending its use of the Rapid DNA tests, claiming that it’s only a trial program and that they won’t be used on everyone crossing the border. At least for now.
To End Crushing Debt, Warren Introduces Relief Package to Help Storm-Ravaged Puerto Rico 'Recover With Dignity' - A group of Democratic Senators, led by Elizabeth Warren, are again pushing to have Puerto Rico's debt forgiven in the wake of dual hurricanes that hit the island in 2017—an announcement that came as activists from the U.S. territory were on Capitol Hill to find a solution to the island's economic woes. The United States Territorial Relief Act of 2019, as Warren's bill is known, would offer comprehensive debt relief to the American territory. Warren was joined by fellow Sens. Kirsten Gillibrand (D-N.Y.), Kamala Harris (D-Calif.), Edward Markey (D-Mass.), and Bernie Sanders (I-Vt.). All but Markey, Warren included, are running for the Democratic nomination for president. "Our bill gives Puerto Rico and other struggling territories a route to comprehensive debt relief and a chance to recover with dignity," Warren said in a statement. "It's time for Congress to pass this bill."If passed, according to an overview (pdf) provided by Warren's office, the legislation would forgive the island's debt, establish a fund for those who suffer losses from the debt cancellation, and create an auditing commission on the genesis of the debt and how the crisis got so out of control.The House version of the legislation is being introduced in the lower chamber by Rep. Nydia Velázquez (D-N.Y.). "Greedy Wall Street vulture funds must not be allowed to reap huge profits off the suffering and misery of the Puerto Rican people for a second longer." --Sen. Bernie Sanders"Puerto Rico needs every tool possible to recover economically and physically from Hurricane Maria," Velázquez said.The same cohort of senators and Velázquez introduced the legislation in 2018. It was ultimately unsuccessful. Puerto Rico's debt issues are nothing new, asCommon Dreams has reported—but things have gotten worse since the 2017 hurricanes and the only legislation in place is outdated and insufficient to address the current problems.
Demanding Medicare for All, Nurses Use Band-Aids to Plaster GoFundMe Pages to Big Pharma Headquarters - Hundreds of nurses and their allies from across the country rallied Monday outside the headquarters of the pharmaceutical industry's top lobbying group and plastered the GoFundMe pages of Americans "suffering in an immoral healthcare system" to the building's walls and windows."The people inside this building spent $28 million on lobbying last year to keep prescription drug prices so unaffordable that some of our patients needlessly die." —Zenei Cortez, National Nurses United The Pharmaceutical Research and Manufacturers of America, or PhRMA, spends tens of millions of dollars a year lobbying on a variety of healthcare issues, and it is currently bankrolling efforts to crush Medicare for All."We are here today—at the headquarters of PhRMA—because this is the scene of a crime," said Zenei Cortez, president of National Nurses United (NNU), which organized the demonstration in Washington, D.C."The people inside this building spent $28 million on lobbying last year to keep prescription drug prices so unaffordable that some of our patients needlessly die," said Cortez.Following their rally, nurses used Band-Aids to cover the walls of PhRMA's headquarters with the GoFundMe pages of Americans who have been forced to crowdsource their medical expenses under the for-profit healthcare system. According to GoFundMe's CEO, a third of all donations on the fundraising platform go toward healthcare costs.
Medicare-for-all advocates get their first hearing on Capitol Hill In the opening moments of Congress’s first-ever hearing on Medicare-for-all, House Rules Committee Chairman Jim McGovern (D-Mass.) hit on a theme that already has begun to dominate the 2020 Democratic primary season: “Health care is a right for all,” he said, “not a privilege for the lucky few.” That mantra, which he and others invoked on Tuesday, is political ammunition for liberals’ crusade to convert the U.S. health-care system into a single-payer model. The language casts a redesign, intended to guarantee all Americans access to care by enlarging the government’s role, as a moral imperative. The most poignant presence during the day-long hearing was that of Ady Barkan, a 35-year-old activist dying of amyotrophic lateral sclerosis, a neurological disease with no cure, who appeared weak and sweaty in a wheelchair and delivered his testimony through a computer because his diaphragm no longer allows him to speak. “The ugly truth is this: Health care is not treated as a human right in the United States of America,” said Barkan, who testified that his care costs $9,000 a month beyond what his private insurance covers, prompting him to resort to GoFundMe campaigns. “On the day we are born and on the day we die, and on so many days in between, all of us need medical care. And yet in this country, the wealthiest in the history of human civilization, we do not have an effective or fair or rational system for delivering that care.” But if the talk of rights bolsters liberals’ health-care agenda, it remains polarizing to politicians, policy experts and voters elsewhere on the ideological spectrum. The disagreement makes the United States an outlier among developed nations, almost all of which long ago embraced the value of health care as a human right. A Pew Research Center survey in September found that 60 percent of respondents said it is the government’s responsibility to ensure that all Americans have health coverage — a marked increase from about a decade ago when the country was more evenly divided. But the partisan differences are stark, with 49 percent of Democrats saying the government should run a single national insurance program but only 12 percent of Republicans agreeing with that idea. Rep. Tom Cole (Okla.), the ranking Republican on the committee, called the Medicare-for-all measure introduced by Rep. Pramila Jayapal (D-Wash.) “a radical bill,” saying Democrats have “not told us how much this massive new program would cost, who would pay for it and how much taxes would have to go up.”
Rep Jayapal and Sen Sanders Have Introduced Medicare For All Bills: One Is a Lot Better Than the Other -Two bills that are called “Medicare for all” bills by their supporters have just been introduced in Congress. On February 27, Representative Pramila Jayapal introduced the Medicare For All Act of 2019, HR 1384 , in the House of Representatives. On April 10, Senator Bernie Sanders introduceda bill bearing the same name in the Senate, S 1129. The cost-containment section in Representative Jayapal’s bill will cut health care costs substantially without slashing the incomes of doctors and hospitals. Senator Sanders’ bill cannot do that. In this article, I explain the differences in the cost containment sections of the two bills and call upon Senator Sanders to correct two defects in his bill that minimize its ability to reduce costs. Defect number one: S 1129 authorizes a new form of insurance company called the “accountable care organization” (ACO). Defect number two: S 1129 fails to authorize budgets for hospitals. Representative Jayapal’s bill, on the other hand, explicitly repeals the federal law authorizing ACOs, and it authorizes budgets for individual hospitals. I write this essay as both a long-time organizer, writer and speaker for a single-payer (the older name for “Medicare for all” system) and a strong supporter of Senator Sanders. Bernie’s enthusiastic support for a “single payer” solution to the American health care crisis has added millions of new supporters to the single-payer movement. But precisely because he is now the most recognizable face of the single-payer movement, it is extremely important that all of us, whether we’re already in the single-payer movement or we just long for a sane and humane health care system, encourage Bernie to fix the defects in his bill. To explain the two defects in S 1129, I must first explain why a single-payer bill like Representative Jayapal’s will be effective at cutting the high cost of American health care. I begin by explaining the origin and meaning of the “single payer” label. I will then describe the two defects in S 1129 in more detail.
Corporate Media’s Open Hostility to Medicare-for-All - A number of high-profile candidates, including Kamala Harris, Tulsi Gabbard and Elizabeth Warren, have endorsed a Medicare for All solution to America’s health care problem. Sen. Bernie Sanders has made it a central platform of his election bid. The United States spends around twice as much on health care as other high-income nations, with inferior results. Worse still, around 45 million Americans, 13.7 percent of the population, have no health care whatsoever. In late 2018, polls fromReuters and Harris found that at least 70 percent of Americans supported the proposal—including majorities of Republicans.However, corporate media appear to be almost univocally against the idea, with the flow of doom-mongering stories increasing to a roaring flood as the notion gains more traction among the public. Ignoring the many opinion polls showing widespread and increasing support for the plan, CNN (4/24/19) suggests “most Americans” do not want Medicare for All. The New York Times (10/19/18) told us, “Don’t get too excited about Medicare for All.” Evincing no sympathy for the tens of millions without any health care, it invited us to feel instead for the private doctors who would face a “cut in revenue” if the progressive plan were implemented. The Milwaukee Journal Sentinel (8/21/18) described it as a “preposterous proposal,” while USA Today (9/20/17) claimed Bernie’s plan is “all wrong for America.” Invited on NBC’s “Meet the Press” (2/10/19), Colorado Sen. Michael Bennet argued it was a self-defeating notion, claiming what Democrats are really saying to the 180 million people who have private health care “and like it” is that they are going to take their beloved private insurance away from them. (Left unmentioned was the fact that 28 percent of people with employer-sponsored health insurance change plans every 12 months.) Libertarian magazine Reason (11/13/18) claimed it would “cost too much,” while the Wall Street Journal (11/12/18) warned of “the false promise of Medicare for All,” with both arguing that it would slow down the development of new drugs. But a study from the libertarian Mercatus Center accidentally proved Sanders’ plan would actually save the country trillions, with private savings more than offsetting increased public costs. And economist and FAIR contributor Dean Baker found that more government involvement in the pharmaceutical industry would save money and speed up drug development.
How financial markets are responding to the Medicare-for-all push - "Health-care stocks have a Washington, D.C., problem that is likely to linger," said Charley Grant at The Wall Street Journal. Companies across the health-services industry, from insurance giant UnitedHealth Group to Johnson & Johnson and pharma firm Abbott Laboratories, have been getting hammered in the stock market in recent weeks even though they've posted strong earnings. The reason is that investors are panicking about a future threat to those earnings: Medicare-for-all. Pushed by Sen. Bernie Sanders and other leading contenders for the Democratic Party's presidential nomination, the policy would broaden government-run insurance to cover all Americans. It might be a death sentence for private health insurance companies, and — by giving the government the power to negotiate more favorable terms with providers — would likely slash profits "for hospitals and manufacturers of drugs and devices." The sell-off is "reviving memories of the 2008 financial crisis," said Cristin Flanagan and Tatiana Darie at Bloomberg. Insurance and hospital stocks lost $28 billion in market value in one day last week. While this kind of volatility is not unprecedented ahead of a presidential election, a full recovery could "hinge on whether it appears a single-payer policy would truly ban private health insurance policies." Investors need a dose of reality, said Jeff Sommer at The New York Times. Sanders is the front-runner among the Democratic aspirants now, but it's "far too early to divine whether Medicare for All has even a modest chance of coming into existence after the 2020 election." Other top Democrats — including House leader Nancy Pelosi — have not supported it. And the giant health-care companies, which have enormous influence on Capitol Hill, are determined to block it. Perhaps the current slump is simply a readjustment. Health-care stocks have rocketed in the decade since the passage of Obamacare, which investors also hated initially. UnitedHealth, for example, has seen its shares return 1,345 percent in the past 10 years. "At some point, stocks that fly that high simply drop in value. For health-care stocks, this may just be one of those times."
DOJ Lays Out Case For Striking Down Entirety Of ObamaCare - The Trump Administration has laid out its arguments against the constitutionality of ObamaCare as it prepares an all-out assault in the courts that could bring a final Supreme Court ruling during the middle of election season next spring. Filed with the conservative 5th US Circuit Court of Appeals, Assistant Attorney General Joseph Hunt unfurled the administration's new position, which holds that the entirety of the law is unconstitutional. Previously, the administration had argued that some parts of the law could remain in effect, even if the individual mandate is struck down. "Upon further consideration and review of the district court’s opinion, it is the position of the United States that the balance of the ACA also is inseverable and must be struck down" and that the fine on the uninsured "works part and parcel with the other health-insurance reforms in the ACA," the administration wrote in the briefing. The brief is, effectively, a bid to affirm a December decision by US District Judge Reed O'Connor that would have struck down the law if it weren't for the inevitable appeals. The case is widely expected to go all the way to the Supreme Court, what would be ObamaCare's second trip to the highest court in the nation. In his ruling, O'Connor determined that when Congress struck down the individual mandate last year, it effectively nullified SCOTUS's rationale for deeming the law constitutional in 2012. His decision sided with Republican state officials who had filed the challenge. The decision was swiftly appealed by Democratic attorneys general. According to the Washington Examiner, if all of Obamacare were declared unconstitutional, then other provisions in the healthcare law would be undone, like the expansion of Medicaid, cuts to drug prices in Medicaid, and a rule allowing adult children to remain on their parents' plans until the age of 26. Read the brief below:
Watch: Trump wildly — and falsely — declares that people in Wisconsin can ‘execute’ babies - President Trump told Wisconsin voters that mothers of newborn children are allowed to execute their babies. The outrageous claim, which has no basis in fact, came during a raucous Saturday night rally in which the President attempted to explain his understanding of the state’s governor’s vow to veto a bill requiring doctors to provide medical care for babies born after a failed abortion. “Your Democrat governor here in Wisconsin (Tony Evers), shockingly, stated that he will veto legislation that protects Wisconsin babies born alive," Trump declared an hour and five minutes into his monologue. The President then went off the rails with a surreal interpretation of how that scenario — which is highly unlikely to occur at all — might play out. “The baby is born, the mother meets with the doctor, they take care of the baby, they wrap the baby beautifully,” he told supporters in Green Bay, Wisc. “And then the doctor and the mother determine whether or not they will execute the baby. In reality, doctors are required to provide emergency services to babies born prematurely during an abortion procedure or otherwise face felony charges and monetary fines.
Conservatives want to rewrite the Constitution, and they’re dangerously close to doing it - When a wacky Mississippi politician submits anti-Frankenstein legislation outlawing beast/human crossbreeding, it is rightfully ignored by the rest of the nation. That kind of thing is just par for the course in this place. However, just a few weeks ago, Mississippi unleashed a very real monster, that could soon be lumbering down the mountain toward your village. Last month, state legislators passed Senate Concurrent Resolution 596, which tips Mississippi over into an expanding swamp of states supporting a broad re-write of the U.S. Constitution. This political misfire is the culmination of a well-financed national campaign led by special interest groups looking to call a constitutional convention under Article V of the U.S. Constitution. This constitutional convention, or “con-con,” could actually deep-six everything in the U.S. Constitution that’s designed to foster freedom and equality. “Once you open up that Pandora’s box anything can happen,” said state Rep. Dave Baria, who voted against the measure when it passed the state House. “Once the convention is convened then the entire thing, including the Bill of Rights, the freedom of the press, the freedom of assembly, the right to a jury trial, the right to be free from unreasonable search and seizure, all of these things could simply go away.” Article V requires that two thirds of the states (34) have to call for a constitutional convention to make it happen. Since the 1980s, about 28 states, including Mississippi, have applied to Congress to hold a constitutional convention focused on balancing the federal budget, though there’s really no way to limit the scope of a constitutional convention once it’s up and running. More recently, some states have called for a constitutional convention for the much broader purpose of trying to limit the power of the federal government. With SCR 596, Mississippi threw its hat into that ring too, bringing the total there to fifteen states. “The first question you have to ask yourself is who gets to go to the convention to shape our new constitution,” said Mike Sayer, retired senior organizer for Mississippi pro-democracy group Southern Echo. “The likelihood is that people who really want this convention and are really determined to control the convention will be the ones with the money to support campaigns to dominate the nomination process.”
“Hands Off Ilhan”: Black Women Rally in Support of US Congresswoman Omar - — As chants of “We love you” grew louder, Ilhan Omar couldn’t hold back her tears. One of the first two Muslim women ever elected to the United States Congress, Omar has become a target in her early months in Washington, with Israel supporters and Republican politicians frequently attacking the Democrat from Minnesota. Yet in the face of those attacks, on Tuesday, dozens of women from the Movement for Black Lives, a coalition of African-American advocates, gathered in front of the Capitol Building in Washington to express solidarity with Omar. And the congresswoman was visibly moved. “The thing that upsets the occupant of the White House, his goons in the Republican Party [and] many of our colleagues in the Democratic Party,” Omar told the crowd, “is that they can’t stand that a refugee, a black woman, an immigrant, a Muslim, shows up in Congress thinking she’s equal to them.” Omar first stirred outrage earlier this year when she said support for Israel in the US is driven by AIPAC’s reach in Congress, remarks that were viewed by some as invoking an anti-Semitic trope. Thereafter, Omar’s critics appeared to scrutinise every word she said. And that pressure eventually led to a tweet by President Donald Trump this month linking the congresswoman to the 9/11 attacks, after she was accused of downplaying the tragedy. African-American civil rights activist and scholar Angela Davis denounced the “logic of scapegoating” coming out of the White House. Davis said the campaign against Omar is not only aimed at the congresswoman, but is designed to dissuade politicians and activists from speaking out on certain issues, including justice in Palestine.
Telecom giants battle bill which bans Internet service throttling for firefighters in emergencies - Internet service providers (ISPs) and telecom firms are fighting a bill which would force them to provide unfettered broadband services and prevent them from throttling data use in emergency situations. The proposed legislation is due to voted upon by California's Communications and Conveyance Committee next week. As reported by StateScoop, the bill -- introduced in February -- aims to prevent a repeat of what happened in summer 2018 during the Mendocino Complex Fire, one of the largest wildfires recorded in California's history. During the blaze, which erupted in July, two combined fires burned a combined 459,123 acres, destroyed 280 structures, and resulted in the death of one firefighter, as reported by the Sacramento Bee. As firefighters from the Santa Clara County Central Fire Protection District fought to contain the fires, they found their Internet service drastically reduced, having been throttled in what Verizon Wireless later called a "customer support mistake." Such connectivity can be crucial in emergency situations to coordinate rescue and firefighting efforts. The fire department had an "unlimited" plan with Verizon, but Ars Technica reports this service was throttled to speeds of either 200kbps or 600kbps once 25GB -- the monthly cap -- was surpassed. Verizon said at the time that the company has an internal policy to remove "data speed restrictions when contacted in emergency situations," but this did not happen during the wildfires.
Postmaster Warning- The United States Postal Service Is In A Death Spiral - The United States Postal Service (USPS) is in a “death spiral” as it fears it will run out of cash by 2024. The postmaster general warned Tuesday that unless major changes are made to the model politicians set up to fail, the USPS will be unable to remain solvent. The USPS has had dwindling revenue for years, even though they deliver to about 1 million new addresses each year. Most of the reason why is because private companies, such as UPS and FedEx are offering services the post office cannot. Competition in the marketplace will lower the costs, but public services can’t compete with private ones (because bureaucracy is expensive), and historically, are disasters waiting to happen. The organization has stayed afloat largely by defaulting on $48 billion in mandated payments over the past several years, Megan Brennan, the Postmaster General said during a hearing called by the House Committee on Oversight and Reform, and its operations are further complicated by inflation-linked caps on price increases for key products, according to a report by the Washington Examiner. “Given the restraints imposed by law, no set of management actions is sufficient to offset the continuing decline in the use of mail,” said Brennan. People are moving toward online statements and paperless options when possible, which is helping to make USPS obsolete. And politicians are already suggesting that the government, over $22 trillion in debt, should just throw money at USPS to force it to work rather than letting it fail so the void can be filled by private companies operating in a more free market. Changing the 2006 law which requires the post office to pay in advance for retiree health benefits, rather than covering them as they come due, won’t fix the problem of fewer Americans choosing to use paper mail. And experts agree, it’s not going to solve the problem of USPS’s insolvency in the long run.
NASA Says Metals Fraud Caused $700 Million Satellite Failure - A metals manufacturer faked test results and provided faulty materials to NASA, causing more than $700 million in losses and two failed satellite launch missions, according to an investigation by the U.S. space agency. The fraud involved an Oregon company called Sapa Profiles Inc., which falsified thousands of certifications for aluminum parts over 19 years for hundreds of customers, including NASA. The bad parts were used in the making of Taurus XL, a rocket that was supposed to deliver satellites studying the Earth’s climate during missions carried out in 2009 and 2011. The launch vehicle’s fairing, a clamshell structure that carries the satellite as it travels through the atmosphere, didn’t fully open, causing the unsuccessful launch, according to a statement from NASA.“When testing results are altered and certifications are provided falsely, missions fail,” said Jim Norman, director for launch services at NASA in Washington. He added that years of scientific work were lost because of the fraud.News of the satellite failures comes a week after Norsk Hydro ASA, the current parent company of Sapa, agreed to pay $46 million to NASA, the Department of Defense and others to resolve criminal charges and civil claims related to the fraud, which took place from 1996 to 2015.The company admitted that employees had faked test results related to the metal’s strength and reliability under pressure. Sapa Profiles, now known as Hydro Extrusion Portland Inc., also agreed to plead guilty to one count of mail fraud and is barred from U.S. federal government contracting.
Boeing Kept Mum to Customers, FAA About Disabling of 737 Max Warning System – Yves Smith -Boeing made safety optional on its 737 Max to an even greater degree than was previously reported. One factoid that had come out in previous articles on the 737 Max was that Boeing had made a safety feature that would have alerted pilots to the malfunctioning of the angle of attack sensors an option that an airline could obtain only by purchasing a package of safety upgrades. American Airlines did buy this suite of add-ons. The Wall Street Journal article that broke this story says that getting this alert back was one of the reasons it paid up to get the safety suite. This matters because the infamous MCAS software system relied on input from that sensor (more accurately, only one of the two angle of attack sensors at any point in time) to decide if and when it needed to push the nose down to prevent a stall. Pilots could have ascertained the sensors were malfunctioning before takeoff, or if they got an alert during flight, they could have disabled the MCAS system, or been ready to do so if the plane started to misbehave.This basic fact pattern has been revealed to be worse than it first appeared by virtue of Boeing not having been explicit that the angle of attack sensor alerts had been disabled on the 737 Max. Why should Boeing have cleared its throat and said something? Recall that the sales pitch for the 737 Max was that it was so much like existing 737s that it didn’t require FAA recertification or pilot simulator training. But the angle of attack sensor alert had been a standard feature in all previous 737s, meaning buyers would assume it was part of the plane unless they were told otherwise. And on top of that, the non-upgraded 737 Max did have lights in the pilots’ controls for this alert. But they didn’t work unless the buyer had purchased the package of safety extras. And the proof that Boeing was playing way too cute with its pointed silence about its deactivation of what had been a standard feature? The biggest customer for the 737 Max, Southwest Airlines, had inaccurate information in its pilots’ manual because the airline had mistakenly assumed the angle of attack sensor alerts worked as they had on earlier 737s.
Boeing Changes Its Story, Admits 'Software Glitch' Disabled Critical Alerts On 737 MAX - In a clarification that only created more confusion, Boeing said Monday that an alert intended to notify pilots when the plane might be receiving erroneous data from one of the 737 MAX 8's 'angle of attack' sensors wasn't disabled intentionally, as WSJ reported on Sunday, but that the feature had been disabled because of a previously undisclosed software glitch.What's confusing is that Boeing had confirmed WSJ's story that the aerospace company had neglected to tell the FAA and Southwest, the biggest customer for the 737 MAX 8, that the alert feature had been disabled because it had been made a new 'optional' safety feature. The alerts would have warned pilots that the plane's MCAS system might be about to misfire. However, the airline appears to have changed its story, offering little clarification as to why. During Boeing's shareholder meeting in Chicago on Monday, CEO Dennis Muilenburg repeated the company's claim that the alerts were a 'non-essential' feature, however, given the fact that the misfire of Boeing's MCAS system (which Muilenburg also insisted wasn't an 'anti-stall' system, as it has been regularly described in media reports, but instead characterized it as a safety system) is widely suspected to have caused the crashes of Lion Air and an Ethiopian Airlines flights that together killed nearly 350 people makes this claim difficult to believe.The company said that it didn't intentionally deactivate the alerts, and that they had only been disabled because of the software issue.Boeing is now saying that its engineers, as well as safety regulators at the FAA, either missed or overlooked the software glitch that rendered these alerts inoperable, presumably even on planes where the extra safety features had been paid for. The alerts had been standard on earlier models. The Monday statement suggests Boeing engineers and management, as well as U.S. air-safety regulators, either missed or overlooked one more software design problem when the model was certified two years ago. Before Monday, neither Boeing nor the Federal Aviation Administration had disclosed that an additional software glitch—rather than an intentional plan by the plane maker—rendered so-called angle of attack alerts inoperable on most MAX aircraft. The alerts warn pilots when there is a disagreement between two separate sensors measuring the angle of a plane’s nose.
Rosenstein submits resignation from Justice Department – Deputy Attorney General Rod Rosenstein formally submitted his resignation on Monday, capping a tumultuous, and unusually high-profile, two-year tenure as the Justice Department’s No. 2. The resignation is effective May 11. Rosenstein was expected to depart the Justice Department in mid-March, shortly after the confirmation of Attorney General William Barr. But he delayed his resignation until the end of special counsel Robert Mueller’s Russia investigation, which Rosenstein oversaw for 22 months. Rosenstein assumed oversight of the investigation after then-Attorney General Jeff Sessions recused himself because of the prominent role he played in Donald Trump’s presidential campaign.Rosenstein didn’t mention Mueller in his resignation letter, which was addressed to Trump. But he referenced the Justice Department’s work in combating foreign interference over the last two years, writing that “our elections are more secure, and our citizens are better informed about covert foreign influence efforts and schemes to commit fraud, steal intellectual property, and launch cyber-attacks.”Rosenstein’s tenure was marked by broadsides against him by the president and congressional Republicans, who questioned his role in overseeing the Mueller investigation and criticized him for what they saw as stonewalling documents requests.Just a few months ago, Trump attacked Rosenstein as “totally conflicted” and retweeted an altered image that depicted the deputy attorney general behind bars, suggesting he should be jailed for treason. He also wrote that Rosenstein appeared to be “planning a very illegal act” with the deputy FBI director, Andrew McCabe, in the early days of his administration, when the pair reportedly discussed ways to remove him from office. Rep. Mark Meadows (R-N.C.), chairman of the House Freedom Caucus, went so far as to file articles of impeachment against Rosenstein last summer. Despite the attacks, Rosenstein told Trump in his resignation letter that he was “grateful to you for the opportunity to serve; for the courtesy and humor you often display in our personal conversations; and for the goals you set in your inaugural address: patriotism, unity, safety, education and prosperity.”
Mueller told Barr his letter didn't capture 'context, nature and substance' of findings - Special counsel Robert Mueller told Attorney General William Barr in a letter sent in late March that Barr's description of the Russia investigation’s conclusions did not "capture the context, nature, and substance" of his findings, The Washington Post reported on Tuesday. "The summary letter the Department sent to Congress and released to the public late in the afternoon of March 24 did not fully capture the context, nature, and substance of this office’s work and conclusions," Mueller wrote in the letter, according to the Post. "There is now public confusion about critical aspects of the results of our investigation. This threatens to undermine a central purpose for which the Department appointed the Special Counsel: to assure full public confidence in the outcome of the investigations." Mueller’s letter was reportedly sent on March 27, just days after Barr released a four-page letter laying out what he described as Mueller’s principal conclusions. In it, Mueller reportedly requested that Barr release the introductions and executive summaries from his lengthy report on Russia's election interference and made suggestions about how the sections could be redacted to conceal sensitive material. "Release at this time would alleviate the misunderstandings that have arisen and would answer congressional and public questions about the nature and outcome of our investigation," Mueller wrote, according to the Post. Barr revealed on March 24 — just days after the conclusion of the special counsel’s investigation — that Mueller did not establish that members of President Trump’s campaign coordinated or conspired with the Russian government. Barr also wrote that the special counsel did not reach a conclusion on whether Trump obstructed justice but that he judged the evidence to be insufficient to accuse the president of criminal wrongdoing. Barr’s letter was sent nearly four weeks before he released a redacted version of Mueller’s 448-page report, and Trump seized on its details as exonerating him of allegations of “collusion” with Russia and obstruction.
Rift opens between Mueller and Barr - Attorney General William Barr has described special counsel Robert Mueller as a friend. But their relationship is showing some strain. A rift has opened between the two men over Barr’s handling of Mueller’s politically charged report on the Justice Department’s two-year investigation into Russian interference in the 2016 election. Barr’s testimony at a Senate Judiciary Committee hearing Wednesday offered new details about the differences between Barr and Mueller, who made clear his displeasure with Barr’s four-page memo describing his investigatory conclusions in a letter to the attorney general in late March.The hearing also offered glimpses of Barr’s misgivings about Mueller’s handling of the probe. And it has raised the stakes for Mueller’s own testimony on Capitol Hill, for which Democrats are clamoring as they excoriate Barr’s handling of the special counsel’s report. The turn of events is a surprising development for two men who were colleagues at the Justice Department and have known one another for three decades, something Barr emphasized during his confirmation hearing three months ago. Their families are close, and their wives attend the same Bible study together. Mueller was also a guest at Barr’s daughter’s wedding.The friction between Mueller and Barr with respect to the Russia investigation was first laid bare Tuesday evening, with the revelation of a letter Mueller wrote to the attorney general on March 27 saying that his memo did not “fully capture the context, nature, and substance” of the investigation’s conclusions.The letter followed reports that members of the special counsel’s office felt Barr’s description did not capture the gravity of their findings on obstruction. Barr on Wednesday called the letter “snitty,” suggested that a Mueller staffer likely wrote it, and said he would rather Mueller have called him to vent his frustration. “I said, ‘Bob, what’s with the letter, you know? Why don’t you just pick up the phone and call me if there is an issue,’ ” Barr said.Barr said Mueller did not accuse him of misrepresenting the facts but said the special counsel’s office took issue with the resulting media coverage and argued releasing summaries from the report would provide more context.“He said that they were concerned about the way the media was playing this and felt that it was important to get out the summaries, which they felt would put their work in proper context and avoid some of the confusion that was emerging,” Barr said. But Mueller’s letter, sent to Capitol Hill on Wednesday, did not mention the media.
About That Letter That Mueller Wrote To Barr… - Another deep state "leak" has hit the tape, and as usual it has gone to the WaPo and NYT almost at the exact same time... but this it's even more laughable than usual. In what the WaPo breathlessly reports late on Tuesday was a rebuke and "complaint" to Attorney General William Barr, special counsel Robert Mueller sent a letter to the AG in late March, just days after Barr sent out his summary to Congress, in which Mueller stated that Barr's 4-page summary to Congress on the sweeping Russia investigation failed to "fully capture the context, nature, and substance" of Mueller’s work and conclusions, citing a copy of the letter it had obtained using its trusted deep intel sources. This is what Mueller said to Barr, according to the leaked NSA intercept: "There is now public confusion about critical aspects of the results of our investigation. This threatens to undermine a central purpose for which the Department appointed the Special Counsel: to assure full public confidence in the outcome of the investigations." And if one reads just that, it certainly does not look good for Attorney General Barr, especially just one day before his first official Congressional hearing on the topic of the Mueller report: so bad that even the absolute lunatic fringe of conspiracygate - which had mercifully shut up for the past month with its daily predictions that this member of the Trump clan is going to jail, or that website will be shut down - has roared back into life with the sage assessment that "this is bad." Pouring more fuel on the fire, the always pithy Axios adds that "this revelation about Mueller's dissatisfaction with the characterization of his report will likely escalate the growing rift over Barr's handling of the special counsel's investigation. House Democrats, who have expressed distrust in the attorney general, are set to vote on Wednesday to allow House Judiciary Committee lawyers to question Barr at Thursday's hearing."
Pelosi accuses attorney general of lying to Congress -US Speaker Nancy Pelosi has accused the Attorney General William Barr of lying to Congress. Her comments came a day after Mr Barr's testimony to a Senate panel about Special Counsel Robert Mueller's report on Russia's alleged meddling in 2016. Mr Barr faced sharp questioning about his decision to clear President Donald Trump of obstruction of justice. The top US law official refused to testify to Democratic-led House Judiciary Committee on Thursday. The stand-off raises the prospect that Mr Barr - America's top legal official - could be held in contempt of Congress. "He lied to Congress. And if anybody else did that it would be considered a crime," Ms Pelosi said on Thursday. "Nobody is above the law," she added. Ms Pelosi's accusation stems from Mr Barr saying he was not aware of any complaints Mr Mueller had about the attorney general's four-page summary of his report. Mr Mueller wrote a letter to Mr Barr saying the summary lacked "context". "It wasn't about technicalities," Ms Pelosi told reporters. "The attorney general of the United States of America was not telling the truth to the Congress of the United States. That's a crime."
US attorney general refuses to testify before House Judiciary Committee - US Attorney General William Barr has decided not to testify before the House Judiciary Committee on Thursday, according to a letter sent by the Justice Department to the House panel Wednesday night. Barr was to take questions on his handling of the report by Special Counsel Robert Mueller into alleged Russian interference in the 2016 elections, possible collusion between Russia and the Trump campaign, and Trump’s efforts to block or shut down Mueller’s investigation. The Justice Department letter was sent Wednesday evening after Barr appeared as the sole witness at a day-long hearing of the Senate Judiciary Committee on the same topic. It is unprecedented for an executive branch official to testify before the Senate and then to refuse a similar request from the House. The refusal is doubly provocative because the Senate is controlled by the Republicans while the House has a Democratic majority. In effect, the Trump administration is declaring, through Barr, that it refuses to be held accountable to the Democrats even though they won the most seats in the House of Representatives in the 2018 elections. This follows a series of actions by the Trump White House that demonstrate a consistent orientation toward the establishment of an authoritarian regime in which the executive rules with the support of the military and police, without any oversight by the legislature or judiciary as co-equal branches of government. The most flagrant defiance of the Constitution came in February, when Trump declared a state of emergency at the US-Mexico border and ordered the Pentagon to redirect military resources to building a border wall. This came after Congress explicitly refused to authorize funds to pay for the wall, leading to a partial shutdown of the federal government that lasted 35 days.
Democrats Rage At Empty Chair As Barr Misses Mueller Hearing - Refusing to allow the fact that AG Barr chose not to attend today's Mueller Report hearing, angry Democrats took full advantage of the photo-op to conjure images of a terrified attorney general cowering from the truth and protecting a clearly guilty-of-something president. Despite Barr's decision last night not to attend, because he objected to Democratic demands that their staff counsel be able to question him, Democrats went forward with the theater of the hearing anyway, setting up an empty chair for the absent attorney general. @RepCohen places a glass chicken in place of AG Barr https://t.co/ZcvGtfCcIz pic.twitter.com/r7BUKyRIkA — The Hill (@thehill) May 2, 2019 As The Hill reports, Rep. Steve Cohen (D-Tenn.) brought a bucket of Kentucky Fried Chicken to the morning event, and accused Barr of being a coward after it ended. Rep. Steve Cohen brought a bucket of Kentucky Fried Chicken to today's hearing, apparently to suggest that Barr is afraid to testify. Via CSPAN pic.twitter.com/g3XOIedYqR — Kyle Griffin (@kylegriffin1) May 2, 2019 House Judiciary Chairman Jerrold Nadler (D-N.Y.) tore into Barr, accusing him of failing to check President Trump’s “worst instincts” and misrepresenting Mueller’s findings. “He has failed the men and women of the Department by placing the needs of the President over the fair administration of justice,” Nadler said. “He has even failed to show up today.”
Five Things I Learned From the Mueller Report - Benjamin Wittes, Editor in chief of Lawfare -- I spent the week after the release of Special Counsel Robert Mueller’s report going through it section by section and writing a kind of diary of the endeavor. My goal was less to summarize the report than to force myself to think about each factual, legal, and analytical portion of Mueller’s discussion, which covers a huge amount of ground. Here are five conclusions I drew from the exercise:
- The president committed crimes. There is no way around it. Attorney General William Barr’s efforts to clear President Donald Trump, both in his original letter and in his press conference the morning of the report’s release, are wholly unconvincing when you actually spend time with the document itself. Mueller does not accuse the president of crimes. He doesn’t have to. But the facts he recounts describe criminal behavior. They describe criminal behavior even if we allow the president’s—and the attorney general’s—argument that facially valid exercises of presidential authority cannot be obstructions of justice. They do this because they describe obstructive activity that does not involve facially valid exercises of presidential power at all. Consider only two examples…
- The president also committed impeachable offenses. Crimes and impeachable offenses are not the same thing, though they are overlapping categories. Some of the most obviously impeachable offenses described in the Mueller report are likely criminal as well. Some may not be. If I were a member of Congress, I would be thinking about which portions of the report describe, in my opinion, the most unacceptable abuses of power. A few stand out to me…
- Trump was not complicit in the Russian social-media conspiracy. Separating the wheat from the chaff is important, so let’s do so. While Trump has a great deal to answer for, Mueller unambiguously clears him—clears in the true sense of the word—of involvement in Russian efforts to interfere in the U.S. election by means of the Internet Research Agency’s social-media campaign.
- Trump’s complicity in the Russian hacking operation and his campaign’s contacts with the Russians present a more complicated picture. Here’s the key point: If there wasn’t collusion on the hacking, it sure wasn’t for lack of trying. Indeed, the Mueller report makes clear that Trump personally ordered an attempt to obtain Hillary Clinton’s emails; and people associated with the campaign pursued this believing they were dealing with Russian hackers. Trump also personally engaged in discussions about coordinating public-relations strategy around WikiLeaks releases of hacked emails. At least one person associated with the campaign was in touch directly with the Guccifer 2.0 persona—which is to say with Russian military intelligence. And Donald Trump Jr. was directly in touch with WikiLeaks—from whom he obtained a password to a hacked database. There are reasons none of these incidents amount to crimes—good reasons, in my view, in most cases, viable judgment calls in others. But the picture it all paints of the president’s conduct is anything but exonerating.
- The counterintelligence dimensions of the entire affair remain a mystery. Because the Mueller investigation was born out of a counterintelligence investigation, there has been an enduring impression that it had both criminal and counterintelligence elements. I have assumed this myself at times. How these two very different missions integrated within the Mueller probe has been much discussed. The Mueller report answers this question, and the answer is actually striking—and from my point of view alarming: The Mueller investigation was a criminal probe. Full stop. It was not a counterintelligence probe. Mueller both says this directly and also describes how the counterintelligence equities were handled.
Nellie Ohr's 'Hi Honey' emails to DOJ about Russia collusion should alarm us all - First came the text messages between FBI lovebirds Peter Strzok and Lisa Page, which gave us a painful glimpse at potential political bias inside America’s most famous crime-fighting bureau. Now, a series of “Hi Honey” emails from Nellie Ohr to her high-ranking federal prosecutor husband and his colleagues raise the prospect that Hillary Clinton-funded opposition research was being funneled into the Justice Department during the 2016 election through a back-door marital channel. It's a tale that raises questions of both conflict of interest and possible false testimony.Ohr has admitted to Congress that, during the 2016 presidential election, she worked for Fusion GPS — the firm hired by Democratic nominee Clinton and the Democratic National Committee to perform political opposition research — on a project specifically trying to connect Donald Trump and his campaign chairman, Paul Manafort, to Russian organized crime.Now, 339 pages of emails from her private account to Department of Justice (DOJ) email accounts, have been released under a Freedom of Information Act request by the conservative legal group Judicial Watch. And they are raising concerns among Republicans in Congress, who filed a criminal referral with the Justice Department on Wednesday night.They clearly show that Ohr sent reams of open-source intelligence to her husband, Associate Deputy Attorney General Bruce Ohr, and on some occasions to at least three DOJ prosecutors: Lisa Holtyn, Ivana Nizich and Joseph Wheatley.The contents tracked corruption developments in Russia and Ukraine, including intelligence affecting Russian figures she told Congress she had tried to connect to Trump or Manafort. “Hi Honey, if you ever get a moment you might find the penultimate article interesting — especially the summary in the final paragraph,” Nellie Ohr emailed her husband on July 6, 2016, in one typical communication. The article and paragraph she flagged suggested that Trump was a Putin stooge: “If Putin wanted to concoct the ideal candidate to service his purposes, his laboratory creation would look like Donald Trump.” Nellie Ohr bolded that key sentence for apparent emphasis. Such overt political content flowing into the email accounts of a DOJ charged with the nonpartisan mission of prosecuting crimes is jarring enough. It raises additional questions about potential conflicts of interest when it is being injected by a spouse working as a Democratic contractor trying to defeat Trump, and she is forwarding her own research to her husband's department and co-workers.
Why Are Clapper And Brennan Not In Jail? - The clearest of all the laws concerning U.S. intelligence is Section 798, 18 U.S. Code - widely known in the Intelligence Community as “the Comint Statute,” or “the 10 and 10.” Unlike other laws, this is a “simple liability” law. Motivation, context, identity, matter not at all. You violate it, you are guilty and are punished accordingly. Here it is:
- (a) Whoever knowingly and willfully communicates, furnishes, transmits, or otherwise makes available to an unauthorized person, . . . any classified information—
- (1) concerning the nature, preparation, or use of any code, cipher, or cryptographic system of the United States or any foreign government; or
- (2) concerning the design, construction, use, maintenance, or repair of any device, apparatus, or appliance used or prepared or planned for use by the United States …or
- (3) concerning the communication intelligence activities of the United States or any foreign government; or
- (4) obtained by the processes of communication intelligence . . .
- Shall be fined under this title or imprisoned not more than ten years, or both.
On December 9 and 10, 2016, the New York Times and the Washington Post independently reported that anonymous senior intelligence officials had told them that, based on intercepted communications, the intelligence agencies agreed that Russia had hacked the Democratic National Committee to help Donald Trump win the election. Their evidence was the fact of their access to U.S communications intelligence. A flood of subsequent stories also cited allegations by “senior intelligence officials” that “intercepted communications” and “intercepted calls” showed that “members of Donald J. Trump’s 2016 presidential campaign and other Trump associates had repeated contacts with senior Russian intelligence officials in the year before the election.” Incontrovertibly, the officials who gave these stories to the Times and Post violated the Comint Statute, and are subject to the “10 and 10” for each count. There is no clearer instance of what the governing law is, of how it was violated, and of the punishment that this incurs. Consequently, there is no clearer indictment of our legal system than the fact that no one has been prosecuted for these violations, much less punished. Nor is there any doubt as to who at least two of these “senior intelligence officials” are: Former CIA director John Brennan and former Director of National Intelligence James Clapper.
Trump sues Deutsche Bank, Capital One to block House subpoenas- President Donald Trump and his family are suing Deutsche Bank and Capital One to block subpoenas issued by House Democrats seeking Trump’s financial records. In the federal lawsuit filed Monday in New York, Trump’s lawyers argued that the subpoenas serve “no legitimate or lawful purpose.” "The subpoenas were issued to harass President Donald J. Trump, to rummage through every aspect of his personal finances, his businesses, and the private information of the President and his family, and to ferret about for any material that might be used to cause him political damage,” the lawsuit contends. "No grounds exist to establish any purpose other than a political one.” The lawsuit, seeking to invalidate subpoenas issued by the House Financial Services and Intelligence Committees, is the latest escalation in Trump’s fight against mounting House investigations into his administration, presidential campaign and business empire. In recent days, Trump has vowed to fight all congressional subpoenas, accusing Democrats of trying to sully his presidency altogether. In a joint statement, House Financial Services Chair Maxine Waters (D-Calif.) and House Intelligence Chair Adam Schiff (D-Calif.) said it was a "meritless lawsuit" that was not designed to succeed — but was "only designed to put off meaningful accountability as long as possible.“ "As a private businessman, Trump routinely used his well-known litigiousness and the threat of lawsuits to intimidate others, but he will find that Congress will not be deterred from carrying out its constitutional responsibilities," they said. Democrats have said they are seeking Trump financial records as part of investigations into potential foreign influence on the U.S. political process and the abuse of the U.S. financial system for illicit purposes.
Federal judge rejects Trump request to dismiss Democrats' Emoluments Clause lawsuit -A federal judge on Tuesday rejected President Trump’s request to dismiss a lawsuit alleging that Trump has violated the Emoluments Clause of the Constitution. U.S. District Judge Emmet Sullivan ruled that the more than 200 Democratic senators and members of Congress behind the lawsuit had reason to seek an injunction in the case and that their request is constitutional. In his ruling, Sullivan found that Trump had disregarded “the ordinary meaning” of the term “emolument” as intended in the Constitution by claiming that it should apply only to profits he earns directly through his own work. In the lawsuit, filed in the U.S. District Court for the District of Columbia, the Democrats allege that Trump violates the Constitution’s Emoluments Clause whenever he profits from foreign governments without Congress’s approval. The lawmakers point to Trump’s vast range of businesses around the world and his declining to fully give up those holdings as evidence that he has violated the clause. Trump’s attorneys argue that the clause does not apply to the commercial transactions with foreign governments and goes into effect only if Trump directly profits or receives a gift from a foreign government in exchange for an action that he has taken as president. Sullivan, an appointee of former President Clinton, also rejected the president’s claim that the lawmakers cannot sue him on an individual basis because their duties are only “marginally related” to the Emoluments Clause. “The only way the Clause can achieve its purpose is for the President to seek and obtain the consent of Congress before he accepts foreign Emoluments,” the judge wrote, noting that the lawmakers are alleging ”that they have been deprived of the right to vote to consent to the President’s receipt of foreign Emoluments before he accepts them.” “Plaintiffs’ injury is therefore hardly 'marginally related' to the purpose of the Clause, but is directly related to the only way the Clause can achieve its purpose,” Sullivan’s ruling reads. The president is facing a similar lawsuit from the District of Columbia and Maryland over the alleged Emoluments Clause violations. And the ruling comes as Trump has recently turned to the courts in an attempt to spurn Democratic investigations into him, his family and his private businesses.
Congressional Democrats’ emoluments lawsuit targeting President Trump’s private business can proceed, judge says – WaPo - Democrats in Congress can move ahead with their lawsuit against President Trump alleging that his private business violates the Constitution’s ban on gifts or payments from foreign governments, a federal judge ruled Tuesday.The decision in Washington from U.S. District Judge Emmet G. Sullivan adopted a broad definition of the anti-corruption law and could set the stage for Democratic lawmakers to begin seeking information from the Trump Organization. The Justice Department can try to delay or block the process by asking an appeals court to intervene.In a 48-page opinion, the judge refused the request of the president’s legal team to dismiss the case and rejected Trump’s narrow definition of emoluments, finding it “unpersuasive and inconsistent.”The lawsuit is one of two landmark cases against Trump relying on the once-obscure emoluments clauses of the Constitution.In a case brought in Maryland by the attorneys general of D.C. and Maryland, Justice Department lawyers representing the president have succeeded in temporarily blocking subpoenas for financial records and other documents related to Trump’s D.C. hotel.The congressional case, brought by about 200 Democrats, extends beyond the hotel and provides a potential new avenue for investigators to gain access to a broader array of Trump’s closely held finances.
Obey Congress or Trump? Deutsche Bank, Capital One in no-win situation — No financial institution envies the dilemma Duetsche Bank and Capital One are in this week, with House Democrats ordering them to share records of the Trump Organization's business dealings, and now the Trump administration suing both banks to block the congressional subpoena. The companies are in a lose-lose situation. Congressional subpoena powers are sweeping, so a denial of the lawmakers' request seems unlikely. But obeying the subpoena means disclosing confidential information about perhaps the institutions' most powerful client. “They have obligations to their account holders to keep their bank records private, but at the same time that doesn’t prevent them from complying with a lawful process,” said Scott Pearson, a partner at Ballard Spahr. President Trump, the Trump business organization and his three oldest children — Donald Trump Jr., Ivanka Trump and Eric Trump — asked a U.S. District Court judge to permanently bar Deutsche Bank and Capital One from complying with the subpoena, as well as a preliminary injunction to halt the subpoena while the matter is before the courts. Legal experts question whether the lawsuit can be successful in preventing the two banks from handing over records, but observers say the litigation may temporarily relieve some of the pressure on Deutsche and Capital One if a judge grants at least a temporary injunction. “It is very, very difficult to overturn the subpoena because one of Congress’ functions is to investigate, and as a third party you can get caught in the middle,” said Joe Lynyak, a partner at Dorsey. “The fact that they are suing to stop the enforcement of the subpoenas — that really does take the pressure off of the banks in that they can sit by and wait for the courts.” But most believe that the banks will ultimately cooperate with the House committees investigating the president's businesses.
Cantor Fitzgerald Doesn’t Want This Woman Talking About Her Mug in Court --Lee Stowell couldn’t find her Bernie Sanders mug. It was August 2016 at the Summit, N.J., outpost of Cantor Fitzgerald, the Wall Street brokerage. The tension in the office was becoming unbearable for Stowell—and not only because her colleagues couldn’t stand the rumpled-haired socialist on her mug. For a while, work had felt like a throwback to the early days of her career, when traders could spew invective with impunity, and women had to stomach it or find a way to hold their own. Stowell scanned her desk, then took her hunt to the kitchen. She opened a cabinet, saw Sanders staring back at her, and reached for the mug. “I looked in,” she tells Bloomberg Businessweek. “There was feces in it.” Stowell, now 54, eventually reported what she thought was a pattern of abuse. Not long after, she lost her job as a junk-bond saleswoman. Last year she filed a lawsuit accusing her former boss, a colleague, and Cantor of harassment, discrimination, and retaliation, all of which they deny. The firm believes she participated in or even instigated the ugliness, according to a person familiar with its thinking. Cantor quickly filed a motion with a New Jersey judge to send the lawsuit from open court to a venue that companies much prefer: arbitration. That’s where stories like this usually disappear. Mandatory arbitration, a common provision in employment contracts, forces workers to resolve complaints behind closed doors, without judges and juries. This spares bosses and shareholders from the embarrassment and cost of lawsuits. It also keeps victims from learning about each other and banding together, which means companies can avoid addressing systemic abuse. Wall Street was an early adopter, helping the industry mostly avoid the rush of #MeToo revelations in other industries. Those accounts have helped spark a fight against mandatory arbitration. In February, Democrats in Congress introduced a bill to ban the agreements, and Google gave the right to sue back to its workers. Days later the judge in Stowell’s case rejected Cantor’s request to send her complaint to arbitration. The decision means she may get to tell jurors what women still face in certain corners of Wall Street. “I wasn’t going to give in to them,” she says of her former colleagues, remembering the morning when she found her mug, a Mother’s Day gift, with poop in it. “I was like, you know what, if I make a big deal about it, they’re going to love it.”
Ray ‘Capitalism Is Broken’ Dalio Was The Highest Earning American Of 2018 - Less than a month ago, Bridgewater founder Ray Dalio was warning the world that there would be a "revolution" unless the country could fix its income inequality problem. He's also been repeatedly claiming that capitalism is broken. Broken, that is, for everyone other than Ray Dalio, who was last year's best paid hedge fund manager, according to DealBook; and since hedge funders generate the highest current income of all "workers", he was effectively the highest paid American in 2018 (this, of course, excludes capital gains and other non-current income), when it is estimated that Dalio earned $2 billion over the last 12 months, up from a reported $1.3 billion in 2017.Dalio beat out other big names like Jim Simons of Renaissance Technologies, who earned $1.5 billion, Ken Griffin of Citadel, who earned $870 million, David Shaw of D.E. Shaw, who earned $500 million, Chase Coleman of Tiger Global Management, who earned $465 million and Steve Cohen of Point72, who earned a tiny, by his standards, $70 million. Of course, this raises the obvious question of whether or not Dalio is doing enough to reform a system that he rails against. “As most of you know, I’m a capitalist, and even I think capitalism is broken,” Dalio wrote on Twitter in early April. He then defended the hedge fund business model to NPR last week, stating: “If you were to ask the pensioners and you were to ask our clients, who are teachers or firemen, whether we’ve contributed to their well-being, they would say that they, we, contribute.” Andrew Ross Sorkin questioned whether or not Dalio is putting his money where his mouth is: “...the magnitude of the hedge fund managers’ compensation raises a very basic question about whether capitalism is ‘broken'. Even if Mr. Dalio took home $500 million, the rest of his income could pay 10,000 families $150,000 each.”
Reuters Drops a Bombshell: The Big Short Doomsday Machine Is Back - Pam Martens -In what can only be described as a new low in defining deviancy down on Wall Street, Thomson Reuters’ International Financing Review (IFR) reported this past weekend that some of the biggest names on Wall Street have returned to creating and/or trading synthetic collateralized debt obligations (Synthetic CDOs).The products were a major factor in bringing the U.S. financial system to the brink of failure in 2008. Synthetic CDOs also resulted in hundreds of millions of dollars in fines and reputational damage to these same Wall Street behemoths as investigators found that the firms were allowing hedge funds to pick “crap” subprime mortgage bonds to stuff in the CDOs in order to make windfall profits for the hedge fund, which shorted (bet against) the CDOs. The Wall Street firms had full knowledge of what the hedge funds were doing but, nonetheless, peddled the investments as sound to unsuspecting investors. In some instances, the same Wall Street firm that was selling the product as a good investment to public pension funds, school districts, churches and insurance companies, was also making short bets itself against the CDO. In at least one case involving Goldman Sachs, it placed a 10 to 1 short bet on failure of its own product.Writing for IFR, Christopher Whittall reports that “Trading volumes in synthetic collateralised debt obligations linked to credit indexes are up 40% this year, according to JP Morgan, after topping US$200bn in 2018 on the back of three years of double-digit growth. Meanwhile, analysts predict more than US$100bn in sales of bespoke synthetic CDOs in 2019 following an estimated US$80bn of issuance last year.”Who are the major players in this market? According to Whittall, Citigroup is a major player while Deutsche Bank has “an eye on expanding in this market.” Our own sources tell us that Morgan Stanley has also structured deals in the past two years. The bombshell here is not about the trading of synthetic CDOs. Firms can do that all day long without exposing their balance sheets and the U.S. economy to collapse. The bombshell is that the bespoke (custom-made) synthetic CDO market has returned to Wall Street and if analysts are predicting $100 billion this year after an estimated $80 billion last year, that means the real secret number is dramatically higher. Those figures also reveal nothing about how much shorting is going on. That could be 10 to 1 or even 20 to 1.
Complex securities blamed in crisis make comeback - FT. Investors are flocking back to a complex debt derivatives product blamed for amplifying losses in the financial crisis, reckoning that the securities are safer now that they are no longer backed by subprime mortgages. The vehicles, known as “synthetic” CDOs, short for collateralised debt obligations, bundle together derivatives whose returns depend on the performance of bonds, loans and other debts — providing hedge funds and other investors another way to bet on the creditworthiness of corporate America. In contrast to standard CDOs, which bundle the bonds and loans themselves, synthetic CDOs proved especially destabilising during the crisis because they allowed multiple bets on the same subprime mortgages. Because the newer vintages are backed by corporate debts, rather than risky home loans, Wall Street banks and investors argue the chances of disaster have been dramatically reduced. But not all critics agree. “It’s almost beyond belief that the very same people that claimed to be expert risk managers, who almost blew up the world in 2008, are back with the very same products,” said Dennis Kelleher, chief executive of advocacy group Better Markets. As soon as you think synthetic CDOs, you think of the financial crisis. It has taken investors some time to get over that Peter Tchir, chief macro strategist at Academy Securities The synthetic CDO market is far smaller than it was last decade. But it is growing. JPMorgan analysts estimate that the number of securities tied to an underlying credit index has risen 40 per cent this year, putting that portion of the synthetic CDO market on pace to surpass the $200bn traded in 2018. Other, so-called “bespoke” deals are on course for between $50bn and $80bn of new issuance this year, said bankers. The appeal of synthetic CDOs is that they offer investors higher returns than can be found in global bond markets, where the average yield stands at just 2 per cent and trillions of dollars in debt trades at negative yields. By contrast, investors willing to take the first losses on the underlying credit derivatives can receive yields of about 10 per cent, traders say.
Regulators plan meeting with law enforcement on banks’ AML burden — The federal financial regulators will meet with law enforcement officials in an attempt to address banks' reporting burdens under anti-money-laundering laws, one top agency head said Wednesday. Federal Deposit Insurance Corp. Chairman Jelena McWilliams said regulators are working with the Financial Crimes Enforcement Network to schedule the meeting, which she said will occur hopefully within a month. The purpose of the meeting, McWilliams said, is to understand what law enforcement and intelligence officials do with the millions of suspicious activity reports banks submit every year without much feedback. Financial institutions have complained that the cumbersome reporting effort does not appear to result in an equal AML benefit. “From our perspective, we would like to know" from law enforcement "what exactly are you doing, how are you looking at it and is there anything that you can do to maybe ... change how the information is submitted and relieve some of the burden while still providing useful” to law enforcement, McWilliams said during a speech at an event hosted by the Independent Community Bankers of America. Since banks do not know how the information is handled, it seems like a "black hole" to them after submitting a SAR, she said. She added, however, that “there is a very good use for this information.” “Once our banks submit all of these SARs and everything else ... how do you [law enforcement] analyze this information because you must get millions, if not billions, of pieces of information from all these different banks,” McWilliams said to reporters after the speech. The financial regulators have been meeting with Fincen for the past year to begin rolling out amendments to streamline the Bank Secrecy Act and AML rules that the industry has long argued are more burdensome than effective in catching criminal activity. These efforts included a joint statement issued in October encouraging community banks and credit unions to share resources with each other in order to comply with AML requirements, and clarifying which circumstances allow such sharing. The statement was issued by Fincen, the FDIC, the Federal Reserve Board, the Office of the Comptroller of the Currency and the National Credit Union Administration. Yet the prudential regulators are limited in their authority to deal with some of the larger AML-related issues, such as a congressional requirement that banks must submit SARs on transactions of $5,000 or more and currency transaction reports on transactions starting at $10,000. The thresholds have not been changed for decades and banks argue the amounts are too low, causing them to submit more paperwork than necessary.
Regulators making 'good progress' on Volcker Rule 2.0: Fed's Powell — Federal Reserve Chairman Jerome Powell said banking regulators are making headway on efforts to streamline Volcker Rule compliance, but he declined to offer any specifics. The agencies proposed revisions a year ago meant to simplify how firms comply with the trading ban, but the plan met fierce pushback from financial institutions that opposed the idea of a new accounting standard to determine which trades are prohibited. Officials have discussed a number of possible steps to address the concerns, including implementing less controversial reforms or submitting a new proposal. Last month, Bloomberg News reported the agencies were considering dropping the so-called "accounting prong." Powell said the agencies were making "good progress" but did not give a time frame for the next step. “We put out a proposal on Volcker some time ago and we got a lot of comments and we’re reviewing them carefully,” Powell said at a press conference held after the Federal Open Market Committee’s regular meeting Wednesday. “I know they’re making good progress, but I don’t really have a date though.” The 2018 proposed revamp was intended to simplify compliance with the crisis-era regulations outlined in the Dodd-Frank Act, but was met with fierce pushback from financial institutions who argued that a new accounting standard to designate certain trades as proprietary would be even more burdensome. In March, Federal Deposit Insurance Corp. Chairman Jelena McWilliams floated the idea of extending certain exemptions from the trading ban for banks with foreign funds that were not considered a covered fund, which would give the regulators more time to work on a broader re-proposal of the more substantive changes. Sen. Warren Wants to Jail Those Who Caused 2008’s Meltdown - NEP’s BIll Black appears on The Real News Network and examines the historical context of Warren’s bills for easier prosecution of banks and corporate leaders. You can view with transcript here.
If Current Laws Prosecuting Bankers Aren’t Used, What Can Warren Change? - - NEP’s Bill Black appears on The Real News Network and demolishes the notion that we can’t prosecute banksters with the laws we now have in place. You can view here with transcript.
Bill Black: If Current Laws Prosecuting Bankers Aren’t Used, What Can Warren Change? - Jerri-lynn Scofield - This is the second in two recent Real News Network interviews with Bill Black, white collar criminologist and frequent Naked Capitalism contributer. Bill is author of The Best Way to Rob a Bank is to Own One and teaches economics and law at the University of Missouri Kansas City (UMKC).See the first interview, Sen. Warren Wants to Jail Those Who Caused 2008’s Meltdown, for background and historical context. The interviews aren’t long, and there are transcripts.Bill argues that the problem isn’t deficient laws, which is Warren’s focus. He says instead:It’s far better to focus on using the existing criminal laws but changing the things in the system that are so criminogenic and changing institutionally the regulators, the F.B.I., and the prosecutors, so that you go back to systems that we’ve always known how to make work. The simple example is task forces. What produced the huge success in the savings and loan, the Commercial Bank, and the Enron era fraud prosecutions? It was these task forces where we brought everyone together to actually bring prosecutions. They killed those criminal task forces, both under the Bush administration and under the Obama administration.I think this is cause for optimism. For it means we don’t have to go through the long and torturous process of passing new laws to get somewhere with fixing a deeply broken system. The Dodd-Frank Act wasn’t passed until July 2010, despite the huge clamor to do something about the banks that created the Great Financial Crisis. And then it took many years for all affected agencies to finish rule-makings necessary to administer and enforce the law. Imagine if we had to do that again to get somewhere with the necessary clean-up. Instead, we merely have to elect politicians who will appoint necessary personnel to confront the prevailing criminogenic environment. I know, I know – that’s a big ask too. But believe me, it would be even bigger if we must also take the preliminary step of passing new legislation as well.
SEC Bars Hedge Fund Manager Who Lost 88% Of His Clients' Money In Three Days -- The SEC barred a "hedge" fund manager from Connecticut after it discovered that he lost $1.8 million of his client's assets after participating in "risky investment practices", which is a polite way of saying losing 88% of their money in about three days.Matthew Rossi and Fairfield, Conn.-based SJL Capital defrauded clients by misleading them about the nature and performance of the fund's investment strategy, according to a cease and desist order from the SEC. Rossi was the founder, managing partner and 80% majority owner of the fund. The SEC's order said that Rossi told investors his fund would invest in a diversified portfolio of publicly traded equities. He also claimed that the fund had a highly successful proprietary algorithm, called MarketDNA, that had been refined over 20 years and included stop losses to limit downside risk.Instead, the SEC alleges that Rossi "engaged in risky, unhedged options trading, which did not comport with the purported MarketDNA strategy and did not include any safety valves or stop loss limits." The strategy of unhedged options trading seemed to work out fine... at first. In June 2016, Rossi used the fund's assets to buy a series of put options that wound up returning him 101% that month. The fund had additional gains of 15% in July and reached its peak valuation of more than $1.3 million at the end of the month.But the fund's success ran out in August 2016 when it lost 88% of its value in days due to the same options "strategies".On August 19, Rossi sold short dated Amazon calls that resulted in a loss of over $600,000. Within minutes of closing that position, Rossi bought Amazon call options, in addition to Priceline call options, and lost over $68,000 when he sold the Amazon options on August 22.By November 2016, the fund had been completely wiped out.
SEC Commissioner Objects To Musk Settlement- I Cannot Support It - Over the weekend, the late Friday headline snuck through that the SEC and Elon Musk had once again agreed to a settlement over Musk's use of Twitter, and the subsequent allegation that Musk should be held in contempt of court for violating a previous settlement. Now, despite Judge Allison Nathan signing off on a second settlement, one voice out of the SEC is speaking out against what he sees as a "bizarre series of events". The news of the second settlement being reached over the weekend went relatively unnoticed, with it again being perceived by many as letting Musk off easy, despite being far more detailed in defining what he is and is not allowed to do on Twitter going forward. While many skeptics and Musk critics derided the second settlement, a more prominent voice has emerged from the criticism: a commissioner at the SEC, Robert Jackson. Jackson, the sole Democrat at the SEC, issued a dissenting statement on Tuesday evening after Judge Nathan approved the deal that resolved the new settlement between Musk and the SEC, according to FT. Jackson had sharp tongued criticism toward the settlement, stating: "Given Mr. Musk’s conduct, I cannot support a settlement in which he does not admit what is crystal clear to anyone who has followed this bizarre series of events: Mr. Musk breached the agreement he made last year with the Commission—and with American investors." Musk had been accused of violating a previous settlement last year that required him to get his tweets pre-approved. The new agreement outlines additional information that requires advanced approval. Musk has denied breaking his initial settlement, an almost laughable defensive posture that ultimately wound up working. The comment is a relatively rare dissent at the SEC, who has been united for the most part, at least in public, on enforcement actions under Jay Clayton. Two Republican commissioners had privately objected to the initial settlement with Mr. Musk last year. And when you can make a point clear to both sides of the aisle – namely that Mr. Musk might be getting special treatment from the SEC - why wouldn't it warrant a further look and additional scrutiny from the public?
N.Y. regulator’s suit to stop fintech charter gets green light — A federal judge ruled Thursday that the New York State Department of Financial Services can proceed with its lawsuit seeking to invalidate a new federal bank charter for fintech firms. Judge Victor Marrero of the U.S. District Court for the Southern District of New York denied a request by the Office of the Comptroller of the Currency to dismiss the case. The New York regulator claims the OCC went beyond its statutory authority when it began offering the special-purpose charter last July. A similar case brought by the Conference of State Bank Supervisors is pending. Both the New York agency and the bank supervisor group argue that the OCC is misinterpreting the National Bank Act, which the federal regulator says gives it the power to charter fintech firms. Marrero suggested the state regulators' argument may have merit. “Such dramatic disruption of federal state relationships in the banking industry occasioned by a federal regulatory agency lends weight to the argument that it represents exercise of authority that exceeds what Congress may have contemplated in passing the NBA,” the judge said in his order. “Indeed, if DFS's characterization of the impact is accurate — which the Court assumes, given the posture of this Order ... the OCC's reading is not so much an ‘interpretation’ as ‘a fundamental revision’ of the NBA.” The OCC filed motions earlier this year to dismiss both the NYDFS and CSBS's claims on grounds that no fintech company has yet applied for the new charter. The New York agency and the bank supervisor group initially filed lawsuits in 2017 when the OCC’s charter was just a proposal. Both cases were dismissed then for not being ripe. The cases were refiled late last year after the OCC finalized its charter offering on July 31. Merrero said the New York case is now ripe partly because Comptroller of the Currency Joseph Otting has repeatedly said the OCC has met with hundreds of fintechs and one is soon to apply for the charter. “In light of these expectations, DFS has demonstrated a ‘substantial risk that the harm will occur,' " he said in the order. “Moreover, based on DFS's allegations about the threats of federal preemption and the unique characteristics of the dual banking system, DFS faces the current risk that entities may, at any moment, leave its supervision to seek greener pastures.”
’April 2019: Unofficial Problem Bank list increased slightly to 73 Institutions - Note: Surferdude808 compiles an unofficial list of Problem Banks compiled only from public sources. Here is the unofficial problem bank list for April 2019. Here are the monthly changes and a few comments from surferdude808: Update on the Unofficial Problem Bank List for April 2019. It was quiet during the month in terms of changes as the list increased by one institution to 73 banks. Aggregate assets increased to $52.1 billion from $51.6 billion a month earlier. A year ago, the list held 94 institutions with assets of $18.9 billion. The addition this month was CFSBANK, Charleroi, PA ($488 million).
Durbin reintroduces bill to cap consumer loans at 36% — Sen. Dick Durbin, D-Ill., has reintroduced a bill that would create a national interest rate cap of 36% on consumer loans. The legislation, which was unveiled Monday, aims to abolish the high rates charged by payday lenders. It would apply a 36% limit on annual percentage rates for all open-end and closed-end consumer credit including mortgages, car loans, overdraft protection and payday loans, according to a press release from Durbin's office. The rate 36% cap would match the current limit for loans targeting service members and their families, and would not interfere with stricter state rate caps. “For some Americans, payday lenders offer a quick way to make ends meet, but their outrageous interest rates and hidden fees can have crippling effects on the people who can least afford it,” Durbin said in a statement. Durbin criticized a proposal by the Consumer Financial Protection Bureau to remove an underwriting requirement from the agencys' rule governing payday lenders. "President Trump and his administration have opted to roll back the progress we have made on reforming predatory lending by quietly dismantling the rules that regulate these lenders," he said. "We need to take action — now more than ever — to protect working families from predatory lending practices by capping interest rates and fees.” The “Protecting Consumers from Unreasonable Credit Rates Act of 2019” is cosponsored by Sens. Jeff Merkley, D-Ore., Sheldon Whitehouse, D-R.I., and Richard Blumenthal, D-Conn. Previous versions have been floated 2009, 2013, 2015 and 2017, but the bill has never made it to the House or Senate floor.
Most U.S. small business preparing for a recession: Bank of America survey (Reuters) - Small business owners around the country are preparing for a recession, according to a new survey by Bank of America Corp. More than two-thirds of business owners surveyed by the bank said they had taken steps to prepare for an economic downturn, including setting cash aside or planning to reduce expenses. Of the 69 percent of owners who had started preparing for a recession, only 19 percent had opened a line of credit, a figure that Bank of America’s head of small business Sharon Miller said was too low. “When you need a line of credit, you often can’t get one,” she said in an interview. “Business owners should be thinking about that now.” There was less optimism about the U.S. economy than last year, the survey showed. Forty-eight percent of business owners felt the national economy would improve over the next year, down from 55 percent last fall. Concerns about healthcare costs and the impact of trade wars contributed to declining sentiment. Although the bank said it is important for businesses to be ready for a potential downturn, top executives pointed to growth in consumer spending and low unemployment to show the economy is still in good shape. “We continue to see a good, strong solid U.S. economy,” said Chief Executive Brian Moynihan on a conference call earlier this month. The Charlotte-based bank is looking to grow its unit that caters to businesses with fewer than 100 employees and less than $5 million in revenue by putting small business specialists in each of Bank of America’s financial centers, Miller told Reuters.
Critics fear shift at CFPB will let firms off the hook - By refocusing the Consumer Financial Protection Bureau on supervision instead of enforcement, Director Kathy Kraninger says she wants to prevent consumer harm. But skeptics say the new approach could have the opposite effect. In an April speech laying out her priorities, Kraninger demonstrated how the agency continues to move away from the enforcement actions, large fines and public shaming that were the hallmark of her Obama-appointed predecessor, Richard Cordray. Instead, Kraninger said, the agency is emphasizing preventive measures. “Supervision is the heart of this agency,” she said. Observers say while a stronger focus on supervision could benefit consumers more than enforcement in certain cases, civil fines will continue to plummet and a more private process to resolve regulatory matters instead of public disclosure of transgressions may let companies off the hook. “You might see change come about more quickly through supervision than years of litigation,” said Gerry Sachs, a partner at Venable, and a former CFPB senior counsel for enforcement policy and strategy. “The question is, will the CFPB be able to focus on confidential supervisory processes and procedures while also avoiding the pitfalls of regulatory capture. That has yet to be determined.” To many CFPB watchers, a less adversarial approach would be just another example of regulatory relief. Under Kraninger's watch, the CFPB already has proposed revamping a tough payday lending rule. During the combined tenures of Kraninger and former acting Director Mick Mulvaney, the volume of CFPB enforcement actions has fallen by 80%, according to a recent Consumer Federation of America study. Some suggest her approach goes against the bureau's mandate. "So how is she going to show the effectiveness of the bureau when most actions of their actions are done confidentially?” "Congress made a very deliberate decision that all the other regulatory agencies had fallen down on consumer protection leading up to the financial crisis. That was the whole point of the CFPB. They were the cop on the beat." The priorities Kraninger laid out in her speech in April echoed those of Mulvaney, who repeatedly disparaged Cordray for having supported "regulation by enforcement." Although the CFPB under Kraninger has resumed issuing civil investigative demands against financial firms, she has indicated there will be fewer enforcement actions going forward.
House Dems put spotlight on auto lending discrimination -- After last year’s GOP-led repeal of regulatory guidance on auto lending discrimination, House Democrats sought Wednesday to reclaim the narrative, arguing that minority borrowers pay more because of pricing structures that give discretion to car dealers. “Buying a car is a significant purchase for many Americans and should be a fair and transparent transaction, free of discrimination. Unfortunately, this is not the case for persons of color,” Rep. Maxine Waters, a California Democrat who chairs the House Financial Services Committee, said during a subcommittee hearing. The hearing revived a policy fight that had been dormant since May 2018, when Congress passed a measure to undo an effort by the Obama-era Consumer Financial Protection Bureau to address the racial pricing gap. Five years earlier, the consumer bureau issued guidance that listed steps that auto lenders could take to limit their risk of being charged with violating fair lending laws. The guidance was part of a wider CFPB effort — which included stepped-up enforcement — to change how auto loans get priced. Typically, auto dealers have the discretion to charge a higher interest rate than is authorized by the lenders that provide financing to their customers. If the dealer can convince the borrower to pay the higher rate, the dealer and the lender split the extra profit. Under then-Director Richard Cordray, the CFPB pressured auto lenders — though with limited success — to pay car dealers a flat percentage of the loan amount instead. The consumer bureau’s critics, who included auto dealers and lenders, as well as congressional Republicans, contended that the 2013 guidance was an effort to establish rules without seeking public comment. They also argued that the guidance would result in consumers paying higher prices for auto financing. Congressional Democrats, who gained control of the House of Representatives in November, have little ability to influence priorities at the Trump-era CFPB. And while Wednesday’s hearing did not point to any actions that Democrats plan to take, it did provide a forum for witnesses who contend that discretionary pricing models result in discrimination.
CFPB turns its reg relief focus to HMDA -- The Consumer Financial Protection Bureau proposed steps Thursday to ease reporting requirements under the Home Mortgage Disclosure Act, just days after the agency announced it was eliminating an online platform for analyzing raw HMDA data. The bureau released a new notice of proposed rulemaking that would raise the thresholds for collecting and reporting data on both closed-end mortgages and open-end lines of credit. The agency said more regulatory relief was necessary to clarify provisions of the financial reform law enacted by Congress last year. The proposal combined with the agency's elimination of HMDA Explorer, which allows users to access and make queries on data, were seen by several observers as significant steps that could weaken the impact of the disclosure law. "This could be an extensive rollback," said Richard Horn, managing member of Garris Horn and a former CFPB official, of the proposal to raise the thresholds. "The increase in the thresholds for HMDA is also rolling back the HMDA rule to some extent because fewer people would be reporting under HMDA." Meanwhile, observers have been quick to question the removal of HMDA Explorer, which has been seen as a useful tool both for community groups and financial institutions in comparing mortgage information submitted by lenders. "The tool was a reliable and cost-effective (i.e. free) means for community advocates to analyze the patterns of different local lenders, but it was based on the older HMDA data fields," said Warren Traiger, senior counsel at Buckley LLP. The raw HMDA data will still be available on the website for the Federal Financial Institutions Examination Council. But, Traiger said, "The people and groups who used Explorer will need to find alternative software to effectively analyze the expanded HMDA data set with all of the new fields."
De Blasio’s solution to New York’s public housing crisis: Tear it down- To paraphrase a notorious statement by a US general during the Vietnam War, ‘In order to save public housing, you have to destroy it.’ This barbaric philosophy, carried out by US imperialism more recently on a massive scale against cities in Iraq and Syria, is now brought home as part of the war on the American working class. In the latest ‘solution’ to the abysmal conditions in New York City’s public housing system (the New York City Housing Authority, or NYCHA), home to some 400,000 working class residents, the city’s mayor, Democrat Bill de Blasio, proposes to demolish two buildings in a Manhattan public housing complex and turn the land over to private developers to build “mixed income” developments. Undoubtedly, if this experiment is ‘successful,’ more demolitions will follow. The proposed ‘test case’ is in the Fulton Houses NYCHA, an 11-building complex in the rapidly gentrifying Chelsea neighborhood on the west side of Manhattan, only a few blocks south of Hudson Yards, a new, mega development of high end residential and commercial real estate. The existing tenants would be moved to supposedly affordable private housing. The three proposed new buildings will reportedly contain nearly 700 apartments, less than a third of which will be rated as affordable. Illustrating the city’s extreme economic inequality, according to the New York Times, the average rent in the Fulton Houses is $660 per month. By contrast, the median market rate rent in Chelsea is $3,462. The NYCHA residents to be displaced have been given empty assurances by de Blasio and other politicians that they will be protected once relocated to apartments owned by private landlords. The astronomical open market rents in the neighborhood make such statements laughable.
Blacks and Hispanics still wounded from post-crisis foreclosures - Plenty of homeowners succumbed to foreclosure when the housing bubble burst, missing the opportunity to regain their wealth as the market recovered post-crash, according to Zillow. But the effects on Hispanic and black communities in particular were heightened, with many still suffering. Houses foreclosed on in these communities have yet to fully reclaim their values, and black and Hispanic homeowners traditionally hold most of their wealth in their homes, with their properties accounting for more than half of their net worth, according to a Zillow analysis. When the bubble peaked in 2007, Hispanics and blacks had 73.1% and 61.8%, respectfully, of their net worth accounted for in their houses, compared to 46.5% for white homeowners. Hispanic and black homeowners accounted for 19.4% and 12.7% of foreclosures between 2007 and 2015. "The housing bust and foreclosure crisis that followed resulted in a disproportionate number of people of color losing not only the roof over their heads, but the wealth — and the opportunity to potentially build more — that came with it," said Zillow Senior Economist Sarah Mikhitarian in a press release. "Black and Hispanic homeowners were more exposed to the foreclosure crisis because homes accounted for such a large share of their wealth. With fewer assets to draw on, it was harder for them to hold onto their homes if they fell underwater on their mortgages, owing more than their home was worth. For people who ultimately succumbed to foreclosure, they missed out on the opportunity to see their home's equity — and therefore their wealth — climb back up," she continued. While homes in black and Hispanic communities have grown more than double in value since the crisis, prices still sit below their prior peaks — by 4.7% for black communities and 9.5% for Hispanic.
Fannie Mae: Mortgage Serious Delinquency Rate Decreased in March Fannie Mae reported that the Single-Family Serious Delinquency rate was decreased to 0.74% in March, from 0.76% in February. The serious delinquency rate is down from 1.16% in March 2018. 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 matches is the lowest serious delinquency rate for Fannie Mae since August 2007. By vintage, for loans made in 2004 or earlier (3% of portfolio), 2.68% are seriously delinquent. For loans made in 2005 through 2008 (4% of portfolio), 4.50% are seriously delinquent, For recent loans, originated in 2009 through 2018 (93% of portfolio), only 0.33% are seriously delinquent. So Fannie is still working through poor performing loans from the bubble years.The increase late last year in the delinquency rate was due to the hurricanes - there were no worries about the overall market. I expect the serious delinquency rate will probably decline to 0.5 to 0.7 percent or so to a cycle bottom.
MBA: Mortgage Applications Decreased in Latest Weekly Survey - From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey:Mortgage applications decreased 4.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 26, 2019... The Refinance Index decreased 5 percent from the previous week. The seasonally adjusted Purchase Index decreased 4 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 1 percent higher than the same week one year ago. “Mortgage rates were lower last week – with the 30-year fixed rate declining to 4.42 percent – as concerns over global growth, particularly in Germany, outweighed more positive domestic news on first quarter GDP growth and business investment,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Applications to refinance and purchase a home both fell, but purchase activity still remained slightly above year ago levels. The drop in refinances were driven by fewer FHA and VA loan applications, which typically lag the movement of conventional loans.” Added Kan, “The ARM share of applications decreased to 6.2 percent, its lowest share since August 2018. So far in 2019, we continue to see a preference for 7/1 ARMs, which account for around 36 percent of all ARM applications, followed by 10/1 and 5/1 ARMs. This is another indication that the few borrowers who choose to apply for ARM loans are electing to reap the benefit of lower rates, as well as some rate stability.”...The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.42 percent from 4.46 percent, with points increasing to 0.46 from 0.44 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The first graph shows the refinance index since 1990.Once mortgage rates fell more than 50 bps from the highs of last year, a number of recent buyers were able to refinance. But it would take another significant decrease in rates to see a further increase in refinance activity. The second graph shows the MBA mortgage purchase index
Mortgage applications decrease even as interest rates fall - Mortgage applications decreased 4.3% from one week earlier although concerns over the global economy resulted in falling interest rates, according to the Mortgage Bankers Association. The MBA's Weekly Mortgage Applications Survey for the week ending April 26 found that the refinance index decreased 5% from the previous week. The seasonally adjusted purchase index decreased 4% from one week earlier, while the unadjusted purchase index decreased 3% compared with the previous week and was 1% higher than the same week one year ago. The refinance share of mortgage activity decreased to 38.8% of total applications from 39.4% the previous week. Apps decline "Mortgage rates were lower last week — with the 30-year fixed rate declining to 4.42% — as concerns over global growth, particularly in Germany, outweighed more positive domestic news on first quarter GDP growth and business investment," Joel Kan, the MBA's associate vice president of economic and industry forecasting, said in a press release. "Applications to refinance and purchase a home both fell, but purchase activity still remained slightly above year ago levels. The drop in refinances were driven by fewer FHA and VA loan applications, which typically lag the movement of conventional loans." The adjustable-rate mortgage share of applications decreased to 6.2% from 6.4%, its lowest share since August 2018, said Kan. "So far in 2019, we continue to see a preference for 7/1 ARMs, which account for around 36% of all ARM applications, followed by 10/1 and 5/1 ARMs. This is another indication that the few borrowers who choose to apply for ARM loans are electing to reap the benefit of lower rates, as well as some rate stability."
Case-Shiller: National House Price Index increased 4.0% year-over-year in February S&P/Case-Shiller released the monthly Home Price Indices for February ("February" is a 3 month average of December, January and February prices). This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index. From S&P: S&P CoreLogic Case-Shiller Index Shows Annual Gains Continue to Decline The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 4.0% annual gain in February, down from 4.2% in the previous month. The 10-City Composite annual increase came in at 2.6%, down from 3.1% in the previous month. The 20-City Composite posted a 3.0% year-over-year gain, down from 3.5% in the previous month. Las Vegas, Phoenix and Tampa reported the highest year-over-year gains among the 20 cities. In February, Las Vegas led the way with a 9.7% year-over-year price increase, followed by Phoenix with a 6.7% increase, and Tampa with a 5.4% increase. Only one of the 20 cities reported greater price increases in the year ending February 2019 versus the year ending January 2019. ... Before seasonal adjustment, the National Index posted a month-over-month increase of 0.2% in February. The 10-City and 20-City Composites both reported 0.2% increases for the month. After seasonal adjustment, the National Index recorded a 0.3% month-over-month increase in February. The 10-City and the 20-City Composites both posted 0.2% month-over-month increases. In February, 14 of 20 cities reported increases before seasonal adjustment, while 17 of 20 cities reported increases after seasonal adjustment. Sales of existing single family homes have recovered since 2010 and reached their peak one year ago in February 2018. Home sales drifted down over the last year except for a one-month pop in February 2019. Sales of new homes, housing starts, and residential investment had similar weak trajectories over the last year. Mortgage rates are down one-half to three-quarters of a percentage point since late 2018. “The largest year-over-year price increase is 9.7% in Las Vegas; last year, the largest gain was 12.7% in Seattle. Regional patterns are shifting. The three California cities of Los Angeles, San Francisco and San Diego have the three slowest price increases over the last year. Chicago, New York and Cleveland saw only slightly larger prices increases than California. Prices generally rose faster in inland cities than on either the coasts or the Great Lakes. Aside from Las Vegas, Phoenix, and Tampa, which saw the fastest gains, Atlanta, Denver, and Minneapolis all saw prices rise more than 4% -- twice the rate of inflation.”
US Home Price Growth Slowest Since 2012 - The slowdown in the US housing market is, well, accelerating. Following last month's disastrous starts and permits data, the Case Shiller's home price index was expected to show growth continuing to slow. and it did, considerably worse than expected.Case-Shiller's 20-City Composite grew at just 3.00% YoY in January (just above the 2.95% YoY expectation but sharply below March's 3.51% YoY print). This is the weakest annual growth since September 2012, decelerating for an 11th month in January as buyers held out for more affordable properties. At the national leve, home prices grew at just a 4% rate, the smallest gain since 2012. “The pace of increases for home prices continues to slow,” said David Blitzer, chairman of the S&P index committee. “Prices generally rose faster in inland cities than on either the coasts or the Great Lakes.” Some more details:
- As has been the case for much of the past decade, all 20 cities in the index showed year-over-year gains, led by a 9.7% increase in Las Vegas and 6.7 percent in Phoenix.
- Increases have slowed considerably over the past year in California, with San Francisco, San Diego and Los Angeles all recording annual gains of below 2 percent. Seattle, another previously hot city, showed an advance of just 2.8 percent.
- Prices in 17 cities rose from the prior month on a seasonally adjusted basis, led by Tampa.
What is odd is that despite alleged wage gains and lower interest rates and borrowing costs, buyers have still been holding out for more affordable properties.That said, as Bloomberg notes, price gains may pick up in the coming months amid signs of strength in demand as the latest new home sales report showed the fastest increase since 2017, while applications for loans to buy homes recently hit the highest weekly level in almost nine years. Meanwhile, keep an eye on pending home sales later on Tuesday for a better sense of momentum in the housing market in the first half of the year. Analysts project contract signings rose for the second time in three months.
Real House Prices and Price-to-Rent Ratio in February - In the Case-Shiller release this morning, the seasonally adjusted National Index (SA), was reported as being 12.4% above the previous bubble peak.However, in real terms, the National index (SA) is still about 7.7% below the bubble peak (and historically there has been an upward slope to real house prices). The composite 20, in real terms, is still 14.5% below the bubble peak. The year-over-year increase in prices has slowed to 4.0% nationally, and I expect price growth will slow some more. Usually people graph nominal house prices, but it is also important to look at prices in real terms (inflation adjusted). Case-Shiller and others report nominal house prices. As an example, if a house price was $200,000 in January 2000, the price would be close to $286,000 today adjusted for inflation (43%). That is why the second graph below is important - this shows "real" prices (adjusted for inflation). The first graph shows the monthly Case-Shiller National Index SA, and the monthly Case-Shiller Composite 20 SA (through January) in nominal terms as reported.In nominal terms, the Case-Shiller National index (SA)and the Case-Shiller Composite 20 Index (SA) are both at new all times highs (above the bubble peak). The second graph shows the same two indexes in real terms (adjusted for inflation using CPI less Shelter). Note: some people use other inflation measures to adjust for real prices.In real terms, the National index is back to February 2005 levels, and the Composite 20 index is back to July 2004. In real terms, house prices are at 2004/2005 levels.On a price-to-rent basis, the Case-Shiller National index is back to February 2004 levels, and the Composite 20 index is back to November 2003 levels. In real terms, prices are back to late 2004 levels, and the price-to-rent ratio is back to late 2003, early 2004.
Zillow Case-Shiller Forecast: National YoY House Price Gains in March similar to February -The Case-Shiller house price indexes for February were released yesterday. Zillow forecasts Case-Shiller a month early, and I like to check the Zillow forecasts since they have been pretty close. From Matthew Speakman at Zillow: February Case-Shiller Results and March Forecast: Home Price Growth Slowest Since 2012Home prices continued to tap on the brakes in February, moderating their earlier breakneck speeds, particularly in pricey West Coast markets. The S&P CoreLogic Case-Shiller National Home Price Index, which tracks home prices nationally and in major metro areas, rose 4% in February from the previous year, a slowdown from 4.2% in January. Below is Zillow’s Case-Shiller forecast for March. It’s scheduled for release on May 28. The Zillow forecast is for the year-over-year change for the Case-Shiller National index to be at 4.0% in March, the same as in February.
Blow Off Top- Bay Area Median Home Price Drops For First Time In 7 Years - San Francisco Bay Area homes declined last month on a y/y basis for the first time in seven years, according to CoreLogic.The median price paid for an existing home in the nine counties (Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma) was $830,000, down 0.1% compared with March 2018. The last time prices fell on a y/y basis was March 2012. After that, the Federal Reserve injected several more rounds of quantitative easing that sent home prices soaring for 83 consecutive months. In March 2018, the median home price gained 16.2% over March 2016.In 2H18, the appreciation rate dramatically slowed due to quantitative tightening, mortgage rate increase, and the start of a synchronized global slowdown."It's not that surprising that we hit the wall, at least in terms of a pause," said Andrew LePage, a CoreLogic analyst, wrote in a release.Glen Bell, a real estate broker with BetterHomes and Gardens Reliance Partners in the East Bay region, said home sales and prices tend to accelerate between February and March as buyers prepare to move before the summer months. He said there was a slight pick up in activity, "but not as strong as last year.""It reflects a trend that began in mid-2018 when home sales slowed and inventory grew, forcing sellers to be more competitive," LePage said."The year-over-year increase in the region’s median sale price was 16.2% in March last year. But after that, the gains in the median gradually decreased each month and fell to the 2 to 3% range early this year and then disappeared this March." Sales of homes in the nine counties were 15% lower in March when compared with last year. It was the lowest March in terms of sales in 11 years. Sales have been slowing on a y/y basis for the last 10 months - an ominous sign that not just the top is in, but a quick reversal in price is immient.
Luxury Home Sales Crash Last Quarter, Biggest YoY Decline Since 2010 - Demand for the nation's most expensive properties collapsed in 1Q19. Sales of homes listed above $2 million plunged 16% YoY last quarter, the most significant decline since 2010, according to Redfin. This comes at a time when sellers understand the cycle is turning, as they flood real estate markets across the country with homes, depressing prices for the fourth consecutive quarter. The average sale price for a luxury home, which Redfin describes as the top 5% most expensive homes in each of the more than 1,000 cities it tracks across the U.S. (not including New York City), fell 1.6% to $1.55 million in 1Q19, the first annual decline in three years. The supply of luxury homes surged 14% annually in 1Q19, the fourth quarter in a row of increases. Waning demand for luxury homes can be attributed to the recent changes in tax law. State and local taxes that homeowners regularly deduct were limited to $10,000, and mortgage interest deduction was reduced from $1 million to $750,000 in mortgage debt. "Because homeowners can’t deduct as much mortgage interest as they used to be able to, the calculus has changed when it comes to buying a home, especially an expensive one," said Redfin chief economist Daryl Fairweather. "Although the new mortgage rule applies to everyone in the country, high earners in states with high income taxes like California and Massachusetts saw their tax bills surge." "Not only do the new rules make it less desirable to purchase a multi-million dollar home in high-tax states, it has also motivated some people—especially those with big incomes and big housing budgets—to consider moving to places like Florida, Washington or Nevada, which have no state income tax," Fairweather added.
NAR: Pending Home Sales Index Increased 3.8% in March --From the NAR: Pending Home Sales Climb 3.8% in March Pending home sales rose in March, reversing course from a month prior, according to the National Association of Realtors®. Three of the four major regions saw growth last month, as the Northeast reported a minor slip in contract activity. The Pending Home Sales Index, a forward-looking indicator based on contract signings,increased 3.8% to 105.8 in March, up from 101.9 in February. Year-over-year contract signings declined 1.2%, making this the 15th straight month of annual decreases...The PHSI in the Northeast declined 1.7% to 90.5 in March and is now 0.4% below a year ago. In the Midwest, the index grew 2.3% to 95.3 in March, 5.0% lower than March 2018.Pending home sales in the South jumped up 4.4% to an index of 127.2 in March, which is 0.7% higher than last March. The index in the West ascended 8.7% in March to 95.1 and fell only 1.6% below a year ago.This was above expectations of a 0.6% increase for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in April and May.
Q1 2019 GDP Details on Residential and Commercial Real Estate -The BEA has released the underlying details for the Q1 initial GDP report. The BEA reported that investment in non-residential structures decreased at a 0.8% annual pace in Q1. Investment in petroleum and natural gas exploration was mostly unchanged in Q1 compared to Q4, but has increased substantially over the last two years. Office Investment as Percent of GDP . The first graph shows investment in offices, malls and lodging as a percent of GDP. Investment in offices increased in Q1, and is up 7% year-over-year. Investment in multimerchandise shopping structures (malls) peaked in 2007 and was down about 22% year-over-year in Q1. The vacancy rate for malls is still very high, so investment will probably stay low for some time. Lodging investment increased in Q1, and lodging investment is up 10% year-over-year. The second graph is for Residential investment components as a percent of GDP. According to the Bureau of Economic Analysis, RI includes new single family structures, multifamily structures, home improvement, Brokers’ commissions and other ownership transfer costs, and a few minor categories (dormitories, manufactured homes). Usually single family investment is the top category, although home improvement was the top category for five consecutive years following the housing bust. Then investment in single family structures was back on top for six years - but home improvement investment exceeded single family in Q1. Even though investment in single family structures has increased from the bottom, single family investment is still very low, and still below the bottom for previous recessions as a percent of GDP. I expect some further increases. Investment in single family structures was $264 billion (SAAR) (about 1.3% of GDP).. Investment in multi-family structures increased in Q1. Investment in home improvement was at a $274 billion Seasonally Adjusted Annual Rate (SAAR) in Q1 (about 1.3% of GDP). Home improvement spending has been solid.
Construction Spending decreased 0.9% in March - From the Census Bureau reported that overall construction spending decreased in March: Construction spending during March 2019 was estimated at a seasonally adjusted annual rate of $1,282.2 billion, 0.9 percent below the revised February estimate of $1,293.3 billion. The March figure is 0.8 percent below the March 2018 estimate of $1,293.1 billion. Both private and public spending decreased: Spending on private construction was at a seasonally adjusted annual rate of $961.5 billion, 0.7 percent below the revised February estimate of $968.6 billion. ... In March, the estimated seasonally adjusted annual rate of public construction spending was $320.7 billion, 1.3 percent below the revised February estimate of $324.7 billion. This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted. Private residential spending had been increasing - but turned down in the 2nd half of 2018 - and is now 26% below the bubble peak. Non-residential spending is 11% above the previous peak in January 2008 (nominal dollars). Public construction spending is just below the previous peak in March 2009, and 23% above the austerity low in February 2014. Year-over-year Construction SpendingThe second graph shows the year-over-year change in construction spending. On a year-over-year basis, private residential construction spending is down 8%. Non-residential spending is up 2% year-over-year. Public spending is up 1% year-over-year. This was well below consensus expectations, and spending for January and February were revised down significantly. A weak report.
Alarms Go Off As Credit Card Charge-Offs Soar To Seven Year High - An ominous trend, indicating US consumers are in far worse shape than assumed by conventional wisdom, has re-emerged. Regular readers may recall that two years ago we wrote that "Credit Card Defaults Surge Most Since Financial Crisis." And while this deteriorating trend had more or less plateaued for much of 2018, it has taken another big step higher and as Bloomberg reports "red flags are flying in the credit-card industry after a key gauge of bad debt jumped to the highest level in almost seven years." According to advance data from Bloomberg Intelligence, which will soon flow through to the S&P/Experian Bankcard Default Index, after staying largely flat for much of 2017 and 2018, the first three months of 2019 saw a troubling jump in the nationwide credit card charge-off, or default rate to 3.82%, the highest in seven years or since the second quarter of 2012. At the same time, the number of loans 30-days past due, a leading indicator of future write-offs, jumped at all seven of the largest U.S. card issuers. Some examples: Capital One said this week that its first-quarter U.S. card charge-off rate climbed to 5.04% from 4.64% at the end of 2018. At Discover Financial Services, which also reported results on Thursday, the charge-off rate rose to 3.5% from 3.23% in the prior quarter. As for what is causing this sharp jump in charge offs, some credit card issuers blamed artificially increased FICO scores. As readers may recall, two weeks ago we asked if "Inflated" FICO Scores Will Be The Catalyst For The Next Meltdown" noting that credit score inflation "is the idea that debtors are actually riskier than their scores indicate, due to metrics not accounting for the "robust" economy, which may negatively affect the perception of borrowers' ability to pay back bills on time. This means that when a recession finally happens, there could be a larger than expected fallout for both lenders and investors."
Personal Income increased 0.1% in March, Spending increased 0.9% - The BEA released the Personal Income and Outlays report for March: Personal income increased $11.4 billion (0.1 percent) in March according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $0.6 billion, (less than 0.1 percent) and personal consumption expenditures (PCE) increased $123.5 billion (0.9 percent). Real DPI decreased 0.2 percent in March, and real PCE increased 0.7 percent. The PCE price index increased 0.2 percent. Excluding food and energy, the PCE price index increased less than 0.1 percent. The March PCE price index increased 1.5 percent year-over-year and the March PCE price index, excluding food and energy, increased 1.6 percent year-over-year. The following graph shows real Personal Consumption Expenditures (PCE) through September 2018 (2012 dollars). The increase in personal income was below expectations, and the increase in PCE was above expectations. PCE growth was weak in Q1, and inflation is below the Fed's target.
U.S. consumer spending roars back, but inflation tame - (Reuters) - U.S. consumer spending increased by the most in more than 9-1/2 years in March as households stepped up purchases of motor vehicles, but price pressures remained muted, with a key inflation measure posting its smallest annual gain in 14 months. The surge in consumer spending reported by the Commerce Department on Monday sets a stronger base for growth in consumption heading into the second quarter after it slowed sharply in the first three months of the year. It further allayed concerns about the economy’s health, which had been brought to the fore by a temporary inversion of the U.S. Treasury yield curve last month. Tame inflation, however, supported the Federal Reserve’s recent decision to suspend further interest rate increases this year. Fed officials are scheduled to meet on Tuesday and Wednesday to assess the economy and deliberate on the future course of monetary policy. The U.S. central bank in March dropped forecasts for any interest rate increases this year, halting a three-year policy tightening campaign. The Fed raised borrowing costs four times in 2018. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, surged 0.9 percent. That was the biggest rise since August 2009 and was also driven by increased healthcare expenditures. Spending rose 0.1 percent in February. Data for January was revised up to show consumer spending rising 0.3 percent instead of the previously reported 0.1 percent gain. The release of the February spending data was delayed by a five-week partial shutdown of the federal government that ended on Jan. 25. Economists polled by Reuters had forecast consumer spending jumping 0.7 percent in March. When adjusted for inflation, consumer spending increased 0.7 percent in March. This so-called real consumer spending was unchanged in February. The data was included in last Friday’s first-quarter gross domestic product report. Consumer spending increased at a 1.2 percent annualized rate in the first quarter, the slowest in a year. The overall economy grew at a 3.2 percent rate last quarter. In March, spending on goods rebounded 1.7 percent, with outlays on long-lasting manufactured goods such as cars shooting up 2.3 percent. Spending on goods fell 0.5 percent in February. Outlays on services increased 0.5 percent last month, driven by healthcare spending, after rising 0.4 percent in February. Inflation was benign, with the personal consumption expenditures (PCE) price index excluding the volatile food and energy components unchanged in March after edging up 0.1 percent in February. That lowered the year-on-year increase in the so-called core PCE price index to 1.6 percent, the smallest increase since January 2018, from 1.7 percent in February.
Energy expenditures as a percentage of PCE --Note: Back in early 2016, I noted that energy expenditures as a percentage of PCE had hit an all time low. Here is an update through the March 2019 PCE report released this morning. Below is a graph of expenditures on energy goods and services as a percent of total personal consumption expenditures through March 2019. This is one of the measures that Professor Hamilton at Econbrowser looks at to evaluate any drag on GDP from energy prices. Data source: BEA Table 2.3.5U. The huge spikes in energy prices during the oil crisis of 1973 and 1979 are obvious. As is the increase in energy prices during the 2001 through 2008 period. In March 2019, energy expenditures as a percentage of PCE increased to 4.04% of PCE, up from the all time low three years ago of 3.6%. Historically this is a low percentage of PCE for energy expenditures.Farmer Income Drops Most Since 2016 as Trade War Losses Mount -- Personal income for farmers fell by the most in three years in the first quarter, as losses to U.S. agriculture mount from President Donald Trump’s trade wars.The Commerce Department on Monday cited the steep decline in farm proprietors’ income as a key factor weighing on the nation’s overall personal income growth in March, even though agricultural producers represent only about 2 percent of total employed Americans. The report provided fresh evidence of the growing financial strain on U.S. farmers hit by the trade war, low commodity prices and a series of natural disasters including spring floods in the Midwest. With rural voters a key part of Trump’s electoral coalition, it also underscores the political pressure to conclude the China trade war as U.S. negotiators begin another round of talks in Beijing this week.One-time subsidy payments from the Trump administration to compensate producers for some of their trade-war losses helped prop up farm income in the previous quarter, but earnings plunged by an annualized $11.8 billion in the January to March period, according to seasonally adjusted data. On Monday, Larry Kudlow, President Trump’s top economic adviser, said the White House is prepared to do more to help agriculture.Trump’s budget cuts would lower federal subsidies for crop insurance and small growers. The spending plan for 2020 he submitted for Congress would reduce subsidies for crop insurance premiums to 48 percent from 62 percent and limit current subsidies for growers who make less than $500,000 annually. Even prior to the trade disputes, U.S. producers were struggling with lower commodity prices. The financial impact has spread across rural America as farmers cut back on purchases from local tractor dealers and other suppliers.
Real Disposable Income Per Capita in March -- With the release of this morning's report on March Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal -0.04% month-over-month change in disposable income was trimmed to -0.24% when we adjust for inflation. This is down from the 0.10% nominal and the 0.00% real increases last month. The year-over-year metrics are 3.23% nominal and 1.72% real. Post-recession, the trend was one of steady growth, but generally flattened out in late 2015. Disposable income picked up in 2018. The first chart shows both the nominal per capita disposable income and the real (inflation-adjusted) equivalent since 2000. This indicator was significantly disrupted by the bizarre but predictable oscillation caused by 2012 year-end tax strategies in expectation of tax hikes in 2013. It will be interesting to see how the recent tax legislation affects the trend over time. The BEA uses the average dollar value in 2012 for inflation adjustment. But the 2012 peg is arbitrary and unintuitive. For a more natural comparison, let's compare the nominal and real growth in per-capita disposable income since 2000. Nominal disposable income is up 89.2% since then. But the real purchasing power of those dollars is up only 34.1%.
US Savings Rate Plunges As Consumer Spending Soars By Most In A Decade (graphs) After lagged (govt shutdown) and mixed performances in the last two months, income and spending growth was expected to rebound notably in March (despite a weak signal from within the GDP data) and while income growth was lower than expected (+0.1% MoM vs +0.4% MoM exp), spending exploded...Personal Spending rose 0.9% MoM (well above the 0.7% expected) and the biggest rise since August 2009.. On a year over year basis, spending has accelerated beyond income growth once again... On the income side, wages unchanged from last month on an annual basis:
- Private workers +4.4% Y/Y
- Govt Workers +3.0% Y/Y
And as expected given the surge in spending, the savings rate collapsed from 7.3% to 6.5% - the lowest since November. This is the biggest monthly drop in the savings rate since Jan 2013. At the same time the Core PCE Deflator is at its lowest since 2017....allowing 'goldilocks' narratives to flourish ahead of this week's FOMC.
Consumer Confidence Improved in April - The latest Conference Board Consumer Confidence Index was released this morning based on data collected through April 18. The headline number of 129.2 was an increase from the final reading of 124.2 for March. Today's number was above the Investing.com consensus of 126.0. “Consumer Confidence partially rebounded in April, following March’s decline, but still remains below levels seen last Fall,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “The Present Situation Index, which had decreased sharply last month, improved in April, as did consumers’ short-term outlook. Overall, consumers expect the economy to continue growing at a solid pace into the summer months. These strong confidence levels should continue to support consumer spending in the near-term.” The chart below is another attempt to evaluate the historical context for this index as a coincident indicator of the economy. Toward this end, we have highlighted recessions and included GDP. The regression through the index data shows the long-term trend and highlights the extreme volatility of this indicator. Statisticians may assign little significance to a regression through this sort of data. But the slope resembles the regression trend for real GDP shown below, and it is a more revealing gauge of relative confidence than the 1985 level of 100 that the Conference Board cites as a point of reference.
Consumer Confidence Spikes As Labor Market Sentiment Approaches Record High - Following several disappointing economic reports, including a continued slump in nationwide home prices and a crash in the Chicago PMI, we got a modest sliver of good news when the Conference Board reported that April Consumer Confidence rebounded from 124.2 to 129.2, a sharp beat to the 126.8 expected.Both estimates of current conditions and economic outlooks improved: the Present Situation Index – based on consumers’ assessment of current business and labor market conditions – increased, from 163.0 to 168.3. The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – increased from 98.3 last month to 103.0 this month. Consumers’ assessment of current conditions improved in April. Those stating business conditions are “good” increased from 34.7 percent to 37.3 percent, while those saying business conditions are “bad” decreased from 12.4 percent to 11.7 percent.Consumers’ short-term outlook also improved in April. The percentage of consumers expecting business conditions will be better six months from now increased from 17.2 percent to 19.9 percent, while those expecting business conditions will worsen declined from 10.0 percent to 9.1 percent.Commenting on the report, Lynn Franco, Senior Director of Economic Indicators at The Conference Board said that “Consumer Confidence partially rebounded in April, following March’s decline, but still remains below levels seen last Fall." Franco noted that "the Present Situation Index, which had decreased sharply last month, improved in April, as did consumers’ short-term outlook. Overall, consumers expect the economy to continue growing at a solid pace into the summer months. These strong confidence levels should continue to support consumer spending in the near-term." And with the payrolls report due out in just three days, many were keeping an eye on the reports' measure of consumer sentimenta bout the labor market as indicated by the "jobs plentiful vs hard to get" indexes: here the respondents' assessment of the labor market was also far more upbeat, with those stating jobs are “plentiful” increased from 42.5%to 46.8%, while those claiming jobs are “hard to get” decreased from 13.8% to 13.3%. As a result, the difference between the two series rose to 33.5, just shy of the highest print this cycle, and approaching levels last seen just before the dot com bubble burst.
Orwell Goes Retail- Stores Now Track Where You Shop... And Sleep - In news that shouldn’t come as a surprise to anyone, retailers are now tracking not only where are you shop, but also where you sleep, according to a new Bloomberg article.For instance, Hill Country Galleria in Bee Cave, Texas used information and location data from customers' phones to determine that a lot of shoppers own pets. Using this data, it went on to install water fountains, babysitting stations and photo op stations for customers and their pets. As a result, the time customers spent in the mall grew by 40%.One shopping Center in Chicago found it was drawing customers from Asian neighborhoods, so it filled one of its vacancies with a high-end Asian specialty grocery. And even Dunkin’ Donuts is getting in on the trend. It employed phone data to make sure that the 278 new stores it was opening wouldn’t steal customers from existing locations.These few clues that retail owners are getting from customers' phones are one of the last chances brick-and-mortar shops have at trying to salvage their industry. They’re buying this mobile phone data hand over fist in order to help determine where people shop, eat and see movies. They’re also looking to see where customers go before and after going to the mall. It helps them look at personal details and paint a picture of the demographic that shops with them. It also helps them advertise But aside from transforming the industry, this is raising privacy concerns. The idea of being tracked – surprise - makes some people uneasy (how that is not "all" is beyond comprehension). All the companies interviewed for the article said that they don’t use any information that can identify individuals, but due to lax regulation, they’re really on the honor system to keep their word. So, we're absolutely positive they're doing the right thing...This new type of analysis is called location analytics and the worldwide industry is expected to grow to $15 billion by 2023 from $8.35 billion in 2017. More than half of the retailers surveyed last year said that they use these firms to collect the data.lan McKeon, chief executive officer of Alexander Babbage, which packages and sells location data said: “Historically, we’ve only been able to look at theoretical behaviors of people. Now we can look at where we’re actually drawing from, and we discovered that the trade areas look nothing like we used to think they did.”
Americans Brace For Shock Surge In Everyday Food Prices - American food merchants are struggling to import fruits and vegetables from Mexico as wait times at port of entries along the Mexico–US border have surged because of a shift in Customs and Border Protection (CBP) personnel away from the port of entries to remote regions of the border to fight illegal crossings. As a result, shipments of food have dramatically declined in recent weeks, and the result is an imminent spike in imported food prices in the coming months that could put a sizeable dent in consumer wallets.Fruit and vegetable importers that wholesale to grocery stores throughout the US, could inflate prices by at least 20% to 40% if the wait times continue, with avocado prices already soaring (see "Mexican Avocado Prices Explode By Most In A Decade After Trump Border Threat"). And it's not just avocados: cucumbers, eggplants, bell peppers, squash, cherry tomatoes, watermelons, and most other fruit and vegetables imported from the tropics would be affected. "(The) Mexican border, it’s one of the most important crossings to the United States," said Joshua Duran, Amore Produce sales representative. About 43% of all US fruit and vegetables originate from Mexico. In the last several decades, Mexico has become the top trading partner with the US. Much of the US-Mexico commerce involves mega-corporations that send products back and forth across the border as part of a critical segment of their supply chain that has increased since the North American Free Trade Agreement (NAFTA) took effect in 1994.
AAR: April Rail Carloads down 0.9% YoY, Intermodal Down 3.9% YoY - From the Association of American Railroads (AAR) Rail Time Indicators. Volumes for U.S. railroads in April 2019 were far from ideal, but they were much better than in March. Total carloads in April were down 0.9% (9,130 carloads), compared with a decline of 8.9% (93,616 carloads) in March. … The improvement in April was due partly to a return to near-normal operations in the Midwest as numerous rail lines that had been flooded were returned to service — coal and grain were especially impacted. ... Intermodal volume fell 3.9%, or 42,832 containers and trailers, in April 2019 from April 2018. That’s the third-straight monthly decline for intermodal, something that hasn’t happened since the fall of 2016.This graph from the Rail Time Indicators report shows U.S. average weekly rail carloads (NSA). Red is 2019. Rail carloads have been weak over the last decade due to the decline in coal shipments.Rail traffic in April 2019 won’t win any prizes, but it could’ve been worse.Total U.S. rail carloads were 1.04 million in April 2019, down 0.9%, or 9,130 carloads, from April 2018. That’s the third straight year-over-year monthly decline for total carloads, but it’s much better than the 8.9% decline in March and the 2.7% decline in FebruaryFor the first four months of 2019, total U.S. carloads were down 2.5%, or 109,930 carloads, from the first four months of 2018. The second graph is for intermodal traffic (using intermodal or shipping containers): For the first four months of 2019, intermodal volume was down 1.4%, or 62,724 units, from the same period in 2019 … This year had a few moving pieces that aren’t always there — e.g., imports being rushed ashore late last year to beat scheduled tariff increases at the start of this year; intermodal lane rationalizations in some areas; the aforementioned flooding; and an economy that’s been even harder than usual to read.
Class 8 Heavy Truck Orders Decimated In April, Down 57% Year Over Year - North American Class 8 net order data shows the industry booked 14,800 units in April, down 57% from a year-ago. The number also marks a sequential decrease of 6.2% from March. The decline is being blamed on companies filling orders from a bloated backlog of last year’s record purchases and buyers juggling remaining orders. The numbers from last month were the lowest for an April since 2016.Year to date, the numbers continue to look ugly. There have been 63,000 trucks ordered, a 63% percent decline from the 169,186 orders placed during the same period in 2018. And it doesn't look like the rest of the year is going to get any better. Kenny Vieth, ACT president and senior analyst said: “We continue to contend that current order weakness has more to do with very large Class 8 backlogs and orders already booked, than with the evolving supply-demand balance. Of course, contracting freight volumes, falling freight rates, and strong Class 8 capacity additions suggest that the supply-demand balance will become an issue later this year.” Vieth continued, pivoting to the medium duty market: “While the U.S. manufacturing/freight economy has been droopy since late 2018, the medium-duty market continues to benefit from underlying strength in the consumer economy. In April, NA Classes 5-7 net orders were 23,100 units, down just 6.8% year-over-year and up 12% from March.”Don Ake, FTR vice president of commercial vehicles commented: “They remember what happened last year when they needed trucks, but could not get enough of them. New orders are expected to remain soft until ordering for 2020 begins this fall." Bob Costello, chief economist of the American Trucking Associations went back to an old favorite - blaming the weather. He said: “In March, and really the first quarter in total, tonnage was negatively impacted by bad winter storms throughout much of the U.S.”
FAA could clear Boeing 737 MAX to fly again within weeks = The Federal Aviation Administration (FAA) could clear Boeing’s 737 MAX to fly again by late next month or early June, according to a person familiar with the safety agency’s latest thinking. If the FAA gives the green light that soon — much more quickly than many analysts have predicted — airlines would still need weeks to get their planes ready and their pilots trained. But the timetable, which assumes no unforeseen developments, means U.S. carriers could have the MAX flying passengers again by early August. The FAA has called a crucial meeting of the heads of civil-aviation authorities from around the world for May 23, where the U.S. regulatory agency is expected to outline its finalized safety analysis in an attempt to foster international consensus. Unless some new issues are discovered, the FAA anticipates telling the assembled foreign regulators that it’s “in a position to clear the aircraft for service sometime in the near vicinity of that meeting,” potentially as early as a week later, said the person familiar with FAA’s latest thinking. The person familiar with the FAA’s view said that once the certification process has been checked and FAA technical staff are convinced the plane is now safe, it will be difficult to justify keeping it grounded because of international political considerations. “With 250 flights a day being canceled (in the U.S.) and the stranded capital of planes parked all over the West, there’s a recognition that every day has an economic cost,” the person said. For the U.S. MAX operators — American, Southwest and United — FAA approval will be the trigger to begin the time-consuming logistics required before commercial flights can resume.
BEA: April Vehicles Sales decline to 16.4 Million SAAR -The BEA released their estimate of April vehicle sales this morning. The BEA estimated sales of 16.43 million SAAR in April 2019 (Seasonally Adjusted Annual Rate), down 5.8% from the March sales rate, and down 4.5% from April 2018. With the weak sales in April, sales in 2019 are averaging 16.7 million (average of seasonally adjusted rate), down 2.3% compared to the same period in 2018. This graph shows light vehicle sales since 2006 from the BEA (blue) and an estimate for April (red).This was below the consensus forecast for April. A small decline in sales this year isn't a concern - I think sales will move mostly sideways at near record levels.This means the economic boost from increasing auto sales is over (from the bottom in 2009, auto sales boosted growth every year through 2016). The second graph shows light vehicle sales since the BEA started keeping data in 1967. Note: dashed line is current estimated sales rate of 16.43 million SAAR.
April US Auto Sales Crash 6.1%, Worst Slide In 8 Years - It was yet another dismal month for US auto sales in April, continuing a recessionary trend that has been in place not only in the US, but globally, for the better part of the last 12 months and certainly since the beginning of 2019. The nonsense-excuse-du jour for this month's disappointing numbers is being placed on the weather on seasonality on rising car prices, which easily pushed away an overextended, broke and debt-laden U.S. consumer. In a nutshell, US auto sales in April tumbled by 6.1% - the biggest monthly drop since May 2011 - to just 16.4 million units, the lowest since October 2014. Aside for an incentive-boost driven rebound in March, every month of 2019 has seen a decline in the number of annualized auto sales. Furthermore, as David Rosenberg notes, the -4.3% Y/Y trend is the weakest it has been for the past 8 years. Adding "fuel to the fire", the average price of a new car in April came in at $36,720, the highest ASP so far this year, according to The Detroit News. It comes at a time where interest rates remain above 6% on average, further pressuring sales. Edmunds analyst Jessica Caldwell said: "April sales were a bit dampened by the harsh financing conditions we’ve been seeing in the new-car market. Shoppers are really starting to feel the pinch as prices continue to creep up and interest rates loom at post-recession highs." Brian Irwin, Accenture Plc’s managing director for North American automotive, said simply: "We are disappointed with how sales turned out." Across the board, almost all major names missed estimates, especially as passenger vehicle sales continued to collapse. Nissan was the one manufacturer that was able to buck the trend for the month. Some additional details, according to Bloomberg:
- Ford’s U.S. sales fell 4.7 percent, according to Automotive News. That was steeper than the 4 percent drop predicted by analysts. The Ford brand fell 4.7 percent, while Lincoln dropped 6.2 percent, the publication reported.
- Fiat Chrysler deliveries fell 6.1 percent, its third straight monthly U.S. sales decline. Chrysler sales fell 37% while Dodge slipped 24%. FCA's Fiat brand saw a 34% dip in sales last month while Alfa Romeo was down 14%.
- Honda eked out a gain of 0.1 percent, as the new Passport sport utility vehicle helps offset declines for cars including the Accord sedan. Honda's passenger car sales fell 2.4%, driven down by an 11.5% drop in Accord deliveries.
- Toyota sales fell 4.4 percent, while the Corolla sedan saw a 32.8% drop in deliveries and its Camry fell 2.1%.
- Nissan, whose total sales rose 9 percent, credited cut-rate financing offers with helping boost its redesigned Altima sedan in April, and the automaker is expanding that program to its Rogue SUV this month.
Purchases Fall As Trade War Hits Farmers – AP - Purchases of farm equipment plunged by an annualized $900 million in the first quarter, the sharpest drop in three years, as U.S. producers struggle with falling commodity prices and collateral damage from President Donald Trump’s trade wars. The Commerce Department cited the drop in agricultural machinery purchases as a contributor to the paltry 0.2 percent quarterly rise in overall business spending on equipment, also the weakest performance since 2016. The softness in the category came despite promises by Trump and Republican leaders that tax breaks for equipment purchases in the party’s signature tax law would boost investment by farmers and manufacturers. The reluctance of farmers and other business owners to invest in equipment flashed a cautionary signal for the U.S. economy and for machinery manufacturers such as Deere & Co. The data was included in the fine print of a Commerce Department report Friday on the economy’s performance that overall surprised forecasters with stronger-than-expected results, showing U.S. growth accelerated to an annualized 3.2 percent rate in the first quarter. The fresh signs of financial pressure on farmers, local tractor dealers and other suppliers that support them underscore the rising political danger the trade war presents to Trump as a negotiating team heads to Beijing next week for another round of trade talks. Lopsided support from rural areas was a key driver for Trump’s narrow 2016 victory over Democrat Hillary Clinton. Kip Eideberg, vice president of government affairs for the Association of Equipment Manufacturers, which represents more than 1,000 U.S. manufacturers of farm, construction and mining machinery, said some member companies have already dismissed workers and deferred capital investment plans because of the trade war. “The retaliatory tariffs that China has levied on almost all U.S. agricultural exports has seriously hurt farmers, further depressed already stressed commodity prices, and has had a chilling effect on equipment manufacturers,” Eideberg said in an emailed statement. The economic squeeze on U.S. producers is tightening after six years of decline in U.S. farm profits, which fell last year to $69.4 billion, half of the $136.1 billion in 2013. Prices of key commodities such as corn and soybeans have declined, while the Trump administration’s immigration crackdown has cut into migrant labor. Midwestern states were hit with historic floods this spring. The trade war struck another blow as key importers of U.S. agricultural products such as China, Canada and Mexico have retaliated against Trump’s tariffs with duties targeting American farmers.
U.S. factory orders post largest increase in seven months - Reuters (Reuters) - New orders for U.S.-made goods rose by the most in seven months in March amid strong demand for transportation equipment, but rising inventories and a marginal rebound in unfilled orders pointed to slower manufacturing activity. Factory goods orders rebounded 1.9 percent, also boosted by orders for computers and electronic products, the Commerce Department said on Thursday. That was the largest rise since August 2018. Data for February was revised up to show factory orders slipping 0.3 percent instead of falling 0.5 percent as previously reported. Economists polled by Reuters had forecast factory orders would rise 1.5 percent in March. Factory orders increased 1.7 percent compared to March 2018. Inventories at factories increased 0.4 percent in March. The stock of unsold goods has increased in 28 of the last 29 months. Unfilled others at factories rose 0.2 percent in March after falling 0.2 percent in February. Manufacturing, which accounts for about 12 percent of the economy, is being pressured by sluggish global demand, continued uncertainty over trade talks between the United States and China, and a large inventory build. Fading depreciation provisions for capital equipment as a result of the Trump administration’s tax restructuring has also slowed business investment, further squeezing manufacturing. A survey on Wednesday showed a measure of national factory activity fell to a 2-1/2-year low in April. In March, orders for machinery edged up 0.1 percent after falling 0.9 percent in the prior month. Orders for electrical equipment, appliances and components rose 0.5 percent while those for computers and electronic products jumped 2.2 percent. Transportation equipment orders surged 7.0 percent in March after falling 2.9 percent in the prior month. Orders for civilian aircraft and parts soared 31.0 percent. Motor vehicles and parts orders increased 1.5 percent. The Commerce Department also said March orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 1.4 percent instead of the 1.3 percent jump reported last week. Orders for these so-called core capital goods were unchanged in February. Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, were unchanged in March rather than slipping 0.2 percent as previously reported. Core capital goods shipments rose 0.3 percent in February. Business spending on equipment spending stalled in the first quarter.
ISM Plunges To Oct 2016 Lows As US Manufacturers Seem Skeptical That Demand Will Persist - Following Canada's Manufacturing PMI plunge into contraction in April, Markit reported US Manufacturing saw a very modest rebound in April (from 52.4 to 52.6) despite the slowest growth in employment in two years.ISM was considerably worse, plunging to its weakest since October 2016 The gauge for export orders fell below 50 for the first time in three years while imports missed the threshold for the first time in two years, the latest evidence President Donald Trump's trade wars are weighing on factories.The measure for new orders also slipped to near the weakest since 2016, indicating softer demand. At the same time, the inventoriesgauge increased, suggesting stockpiles continue to expand, a trend that will likely eventually reverse and be a drag on growth. ISM's employment gauge fell to near a two-year low, signaling weakness ahead of Friday's U.S. jobs report.The index of prices paid dropped to 50, a signal that inflation pressures are likely to remain muted.Chris Williamson, Chief Business Economist at IHS Markit said: "Although the PMI ticked higher in April, the survey remains consistent with manufacturing acting as a drag on the economy at the start of the second quarter, albeit with the rate of contraction easing. Historical comparisons indicate that the survey’s output gauge needs to rise above 53.5 to signal growth of factory production. As such, the data add to signs that the economy looks set to slow after the stronger than expected start to the year.
Dallas Fed: "Growth in Texas Manufacturing Activity Picks Up Slightly" -- From the Dallas Fed: Growth in Texas Manufacturing Activity Picks Up Slightly: Texas factory activity continued to expand in April, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, ticked up two points to 12.4, indicating output growth accelerated slightly from March.Other measures of manufacturing activity also suggested slightly faster expansion in April. The survey’s demand indicators bounced back after dipping last month: The new orders index rose eight points to 9.8, and the growth rate of orders index rose from -2.0 to 5.2. The capacity utilization index pushed to a seven-month high of 15.6, while the shipments index held fairly steady at 6.3.Perceptions of broader business conditions continued to improve in April. The general business activity index remained positive for a third month in a row but fell five points to 2.0. Meanwhile, the company outlook index climbed two points to 6.3.Labor market measures suggested weaker employment growth but slightly stronger growth in workweek length in April. The employment index fell eight points to 4.6, its lowest reading since the end of 2016. This was the last of the regional Fed surveys for April. Here is a graph comparing the regional Fed surveys and the ISM manufacturing index: The New York and Philly Fed surveys are averaged together (yellow, through April), and five Fed surveys are averaged (blue, through April) including New York, Philly, Richmond, Dallas and Kansas City. The Institute for Supply Management (ISM) PMI (red) is through March (right axis). Based on these regional surveys, it seems likely the ISM manufacturing index will be at about the same level in April as in March, maybe slightly lower. The consensus forecast is for a reading of 55.0, down slightly from 55.3 in March (to be released on Wednesday, May 1st).
April Regional Fed Manufacturing Overview - Five out of the twelve Federal Reserve Regional Districts currently publish monthly data on regional manufacturing: Dallas, Kansas City, New York, Richmond, and Philadelphia. Regional manufacturing surveys are a measure of local economic health and are used as a representative for the larger national manufacturing health. They have been used as a signal for business uncertainty and economic activity as a whole. Manufacturing makes up 12% of the country's GDP.The other 6 Federal Reserve Districts do not publish manufacturing data. For these, the Federal Reserve’s Beige Book offers a short summary of each districts’ manufacturing health. The Chicago Fed published their Midwest Manufacturing Index from July 1996 through December of 2013. According to their website, "The Chicago Fed Midwest Manufacturing Index (CFMMI) is undergoing a process of data and methodology revision. In December 2013, the monthly release of the CFMMI was suspended pending the release of updated benchmark data from the U.S. Census Bureau and a period of model verification. Significant revisions in the history of the CFMMI are anticipated." Here is a three-month moving average overlay of each of the five indicators since 2001 (for those with data). The latest average of the five for April is 7.3 up from the previous month's 7.0. It is below its all-time high of 25.1, set in May 2004. Here is the same chart including the average of the five. Readers will notice the range in expansion and contraction between all regions.
Chicago PMI Drops in April - The Chicago Business Barometer, also known as the Chicago Purchasing Manager's Index, is similar to the national ISM Manufacturing indicator but at a regional level and is seen by many as an indicator of the larger US economy. It is a composite diffusion indicator, made up of production, new orders, order backlogs, employment, and supplier deliveries compiled through surveys. Values above 50.0 indicate expanding manufacturing activity. The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, fell to 52.6 in April from 58.7 in March, which was below the Investing.com forecast of 59.1. Values above 50.0 indicate expanding manufacturing activity. Here is an excerpt from the press release:“This was a disappointing start to the second quarter, with more firms cutting back on both production and employment against a backdrop of softer domestic demand and the global slowdown,” said Shaily Mittal, Senior Economist at MNI.“Most Barometer components have dived below their respective 12-month averages, pointing towards greater business uncertainty among firms,” she added. [Source] Let's take a look at the Chicago PMI since its inception.
Construction spending, manufacturing, and temp jobs all decelerate further or decline - On Sunday I said, “Construction spending … should follow housing permits and starts with a delay of several months. But, oddly, even though starts in particular have continued to languish, spending has come back strongly since last November. I’ll be looking to see if that anomaly continues, or whether construction spending reverts to its historical pattern.” I also wrote that “The Fed regional indexes have turned up in the last couple of months, so I am expecting [ISM manufacturing] to improve as well.” Let’s take these in turn. That anomalous increase in residential construction spending since last November got almost entirely erased in revisions, and it declined another -1.8% in March (blue in the graph below, compared with residential construction employment, red): On a YoY basis, whenever residential construction spending has been this negative, residential construction employment has also declined: As of March, it hadn’t yet. Turning to the ISM manufacturing report, it declined to 52.8, the lowest since October 2016. New orders fell to 51.7, the lowest level this year so far: Employment also declined to 52.4, just above its recent low of 52.3 two months ago. This is expansion, but not much. By the way, yesterday the Staffing Index of the ASA for temporary jobs fell to -2.1% YoY: While this isn’t at “Great Recession” levels or even that of the 2015-16 downturn yet, it does suggest further weakness in that leading area. All of which suggests that in Friday’s employment report, the three leading sectors of temporary, manufacturing, and construction jobs ought to continue to decelerate or decline.
ISM Non-Manufacturing Index decreased to 55.5% in April - The March ISM Non-manufacturing index was at 55.5%, down from 56.1% in March. The employment index decreased to 53.7%, from 55.2%. Note: Above 50 indicates expansion, below 50 contraction. From the Institute for Supply Management: April 2019 Non-Manufacturing ISM Report On Business® “The NMI® registered 55.5 percent, which is 0.6 percentage point lower than the March reading of 56.1 percent. This represents continued growth in the non-manufacturing sector, at a slightly slower rate. The Non-Manufacturing Business Activity Index increased to 59.5 percent, 2.1 percentage points higher than the March reading of 57.4 percent, reflecting growth for the 117th consecutive month, at a faster rate in April. The New Orders Index registered 58.1 percent; 0.9 percentage point lower than the reading of 59 percent in March. The Employment Index decreased 2.2 percentage points in April to 53.7 percent from the March reading of 55.9 percent. The Prices Index decreased 3 percentage points from the March reading of 58.7 percent to 55.7 percent, indicating that prices increased in April for the 23rd consecutive month. According to the NMI®, 15 non-manufacturing industries reported growth. The non-manufacturing sector has experienced an uptick in business activity, but in general, there has been a leveling off. Respondents are still mostly optimistic about overall business conditions, but concerns remain about employment resources.” 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 April than in March.
Markit Services PMI: "Slowest business activity growth since March 2017" - The April US Services Purchasing Managers' Index conducted by Markit came in at 53.0 percent, down 2.3 from the final March estimate of 55.3. The Investing.com consensus was for 52.8 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:"The final PMI surveys for April indicate a marked slowing of the US economy at the start of the second quarter, suggesting the robust start to the year has lost some momentum. Businesses reported the weakest output and sales growth for two years, indicative of GDP growth slowing to 1.9% in April.""While the first quarter saw factory weakness being offset by a robust service sector, both manufacturing and services have now shifted into a lower gear." [Press Release] Here is a snapshot of the series since mid-2012.
Weekly Initial Unemployment Claims at 230,000 -- The DOL reported:In the week ending April 27, the advance figure for seasonally adjusted initial claims was 230,000, unchanged from the previous week's unrevised level of 230,000. The 4-week moving average was 212,500, an increase of 6,500 from the previous week's unrevised average of 206,000 The previous week was unrevised. The following graph shows the 4-week moving average of weekly claims since 1971.
Private payrolls surge by 275,000 in April, blowing past estimates in biggest gain since July- The U.S. economy added far more jobs than expected in April as payrolls in the services sector grew by the most in more than two years, according to data released Wednesday by ADP and Moody’s Analytics. Private payrolls grew by 275,000 last month, the biggest increase since July, when they expanded by 284,000. Economists polled by Dow Jones expected private payrolls growth of 177,000. Services-providing jobs increased by 223,000 in April, led by a gain of 59,000 positions in professional and business services. Education and health services companies added 54,000 jobs while employment within the leisure and hospitality industry expanded by 53,000. Goods-producing jobs — which include construction, manufacturing and mining — rose by 52,000, led by a 49,000 payrolls increase in construction. The economy added just 5,000 manufacturing jobs while mining employment declined by 2,000. Overall, medium-sized businesses, those that employ 50 to 499 people, led the way in jobs creation last month by adding 145,000 jobs. Jobs within small businesses, meanwhile, increased by 77,000 while large companies hired 53,000. “The job market is holding firm, as businesses work hard to fill open positions,” Mark Zandi, chief economist at Moody’s Analytics, said in a statement. “The economic soft patch at the start of the year has not materially impacted hiring. April’s job gains overstate the economy’s strength, but they make the case that expansion continues on.” Wednesday’s report came after the Commerce Department said last week the economy grew by 3.2% in the first quarter on an annualized basis. That was the best start to a year since 2015. The official jobs report for April from the government will be released Friday.
A Closer Look at Today's ADP Employment Report - In this morning's ADP employment report we got the April estimate of 275K new nonfarm private employment jobs from ADP, an increase over March's revised 151K. The popular spin on this indicator is as a preview to the monthly jobs report from the Bureau of Labor Statistics. But the ADP report includes a wealth of information that's worth exploring in more detail. Here is a snapshot of the monthly change in the ADP headline number since the company's earliest published data in April 2002. This is quite a volatile series, so we've plotted the monthly data points as dots along with a six-month moving average, which gives us a clearer sense of the trend. As we see in the chart above, the trend peaked 20 months before the last recession and went negative around the time that the NBER subsequently declared as the recession start. At present, the six-month moving average has been hovering in a relatively narrow range around 200K new jobs since around the middle of 2011. ADP also gives us a breakdown of Total Nonfarm Private Employment into two categories: Goods Producing and Services. Here is the same chart style illustrating the two. The US is predominantly a services economy, so it comes as no surprise that Services employment has shown stronger jobs growth. The trend in Goods Producing jobs went negative over a year before the last recession. Interestingly, the Goods Producing jobs saw an uptick in late 2016 that has continued.For a sense of the relative size of Services over Goods Producing employment, the next chart shows the percentage of Services Jobs across the entire series. The latest data point is below the record high. There are a number of factors behind this trend. In addition to our increasing dependence of Services, Goods Production employment continues to be impacted by automation and offshoring. For a better sense of the components of the two Goods Producing and Service Providing cohorts, here is a snapshot of the five select industries tracked by ADP. The two things to note here are the relative sizes of the industries and the relative trends. Note that Construction and Manufacturing are Production industries whereas the other three are Service Providing.
April Employment Report: 263,000 Jobs Added, 3.6% Unemployment Rate - From the BLS:Total nonfarm payroll employment increased by 263,000 in April, and the unemployment rate declined to 3.6 percent, the U.S. Bureau of Labor Statistics reported today. Notable job gains occurred in professional and business services, construction, health care, and social assistance....The change in total nonfarm payroll employment for February was revised up from +33,000 to +56,000, and the change for March was revised down from +196,000 to +189,000. With these revisions, employment gains in February and March combined were 16,000 more than previously reported... In April, average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents to $27.77. Over the year, average hourly earnings have increased by 3.2 percent.The first graph shows the monthly change in payroll jobs, ex-Census (meaning the impact of the decennial Census temporary hires and layoffs is removed - mostly in 2010 - to show the underlying payroll changes). Total payrolls increased by 263 thousand in April (private payrolls increased 236 thousand). Payrolls for February and March were revised up 16 thousand combined. This graph shows the year-over-year change in total non-farm employment since 1968. In April, the year-over-year change was 2.620 million jobs. The third graph shows the employment population ratio and the participation rate. The Labor Force Participation Rate declined in April to 62.8%. This is the percentage of the working age population in the labor force. A large portion of the recent decline in the participation rate is due to demographics and long term trends. The Employment-Population ratio was unchanged at 60.6% (black line). The fourth graph shows the unemployment rate. The unemployment rate declined in April to 3.6%. This was above the consensus expectations of 180,000 jobs added, and February and March were revised up by 16,000 combined. A strong report.
Jobs surge in April, unemployment rate falls to the lowest since 1969 - The U.S. jobs machine kept humming along in April, adding a robust 263,000 new hires while the unemployment rate fell to 3.6%, the lowest in a generation, the Labor Department reported Friday.Nonfarm payroll growth easily beat Wall Street expectations of 190,000 and a 3.8% jobless rate.Average hourly earnings growth held at 3.2% over the past year, a notch below Dow Jones estimates of 3.3%. The monthly gain was 0.2%, below the expected 0.3% increase, bringing the average to $27.77. The average work week also dropped 0.1 hours to 34.4 hours.Unemployment was last this low in December 1969 when it hit 3.5%. At a time when many economists see a tight labor market, big job growth continues as the economic expansion is just a few months away from being the longest in history.The unemployment rate for Asians fell sharply, plunging from 3.1% to 2.2%.While last month’s slump in the jobless rate came with strong increase in hiring, it also was helped along by a sharp decline in the labor force of 490,000. That brought the labor force participation rate down to 62.8%, exactly where it was a year ago.A broader unemployment gauge that includes those who have quit looking for jobs as well as the underemployed held at 7.3%, where it has been since February.Those counted as not in the labor force surged by 646,000 to a fresh high of 96.2 million. “Leaving aside month-to-month fluctuations, the labor market is still very strong, adding almost double the number of workers needed to keep pace with new entrants to the labor force in any given month,” said Eric Winograd, AllianceBernstein’s senior economist. “Wages may have been slightly tepid this month relative to expectations but are still growing at just about the highest rate this cycle, and the unemployment rate is at multi-generational lows.”The level of unemployed people plunged by 387,000 in April, bringing the total level to 5.8 million. However, the ranks of the employed also declined by 103,000, according to the Labor Department’s household survey.Professional and business services led job creation with 76,000 new positions. Construction added 33,000, bringing to 256,000 the total new jobs created in the field over the past year.Health care rose by 27,000, bringing its 12-month total to 404,000, while financial positions increased by 12,000, rounding out an increase of 111,000 in the 12-month period thanks largely to growth in real estate and rental and leasing. Social assistance increased by 26,000, while manufacturing added 4,000.Retail, whose fortunes have fluctuated in recent months, saw a loss of 12,000 jobs. Previous months saw net upward revisions, with February going from a scant 33,000 growth to 56,000, though March’s total was reduced to 189,000 from 196,000, for a net gain of 16,000. Year to date, job gains have averaged 205,000 a month.April’s big increase comes amid a mostly positive backdrop of economic data. GDP increased 3.2% during the first quarter, far exceeding expectations, while productivity during the quarter jumped 3.6% for its best gain in five years. Pending home sales rose 3.8% in March, providing some hope in the real estate market so long as rates are held in check.
April Jobs Smash Expectations, Soar By 263K, But Wage Growth Muted - While overall expectations for the April payrolls number were generally in line, the "whisper" was for some weakness below the 190K consensus as a result of delayed census hiring (as discussed earlier). However, it was just not meant to be as the US job market juggernaut continues to accelerate, and moments ago the BLS reported that in April the US economy added another 263K, smashing expectations of a 190K print, and well above both the March (189K) and February (56K) prints. The April print was well above the average monthly gain of 213,000 over the prior 12 months. Payrolls were highlighted by strength in construction (+33,000), professional and business services (+76,000), education and health services (+62,000); weak spots include manufacturing (+4,000) and retail (-12,000), the third straight decline.The change in total nonfarm payroll employment for February was revised up from +33,000 to +56,000, and the change for March was revised down from +196,000 to +189,000. With these revisions, employment gains in February and March combined were 16,000 more than previously reported. After revisions, job gains have averaged 169,000 per month over the last 3 months.While overall payrolls were scorching, the goldilocks picture continued, as Average hourly earnings rose "only" 0.2% from the prior month, and 3.2% from a year earlier - once again these figures were below forecasts and the same as March's readings, however it is worth noting that wages for production and nonsupervisory workers accelerated to a 3.4% gain from 3.3%, signaling gains for lower-paid employees. As Bloomberg notes, wage growth was led by lower-paid employees - those in production and non-supervisory roles. What is more concerning, and suggests that the real hourly earnings number would be even worse, is that the average workweek actually declined from 34.5 to 34.4, indicating that average comp would be even lower if hours worked was unchanged. While of secondary importance, the jobless rate fell to a new 49-year low of 3.6% (or 3.585% to be precise), down from 3.811% last month, though that was partly due to another drop in the size of the labor force; the household survey showed the employed fell by 103,000, the unemployed fell by 387,000, and the overall labor force shrank by 490K to 162.47 million. Also of note, and a key point that Trump will be making shortly is that Hispanic unemployment dropped to a record low. As noted above, with the labor force tumbling, the labor force participation rate unexpectedly dropped back to the lowest level since the 1960s, sliding from 63.0% to 62.8%. Some more details: Professional and business services added 76,000 jobs in April. Within the industry, employment gains occurred in administrative and support services (+53,000) and in computer systems design and related services (+14,000). Over the past 12 months, professional and business services has added 535,000 jobs.
- In April, construction employment rose by 33,000, with gains in nonresidential specialty trade contractors (+22,000) and in heavy and civil engineering construction (+10,000). Construction has added 256,000 jobs over the past 12 months.
- Employment in health care grew by 27,000 in April and 404,000 over the past 12 months. In April, job growth occurred in ambulatory health care services (+17,000), hospitals (+8,000), and community care facilities for the elderly (+7,000).
- Social assistance added 26,000 jobs over the month, with all of the gain in individual and family services.
- Financial activities employment continued to trend up in April (+12,000). The industry has added 110,000 jobs over the past 12 months, with almost three- fourths of the growth in real estate and rental and leasing.
- Manufacturing employment changed little for the third month in a row (+4,000 in April). In the 12 months prior to February, the industry had added an average of 22,000 jobs per month.
- Employment in retail trade changed little in April (-12,000). Job losses occurred in general merchandise stores (-9,000), while motor vehicle and parts dealers added 8,000 jobs.
- Employment in other major industries, including mining, wholesale trade, transportation and warehousing, information, leisure and hospitality, and government, showed little change over the month.
In summary, it looks like another "meh (or bad) news is good news" report, because while jobs came in stronger than expected, the "goldilocks" aspect of today's report was the weaker than expected hourly earnings, which would have been even lower if average workweek had not dipped. Predictably, stocks found whatever narrative suits them best, and rose while both the dollar and 10Y yields kneejerked higher initially before sliding lower.
April jobs report: great headlines, signs of fraying around the edges - Leading employment indicators of a slowdown or recession. I am highlighting these because many leading indicators overall strongly suggest that an employment slowdown is coming. The following more leading numbers in the report tell us about where the economy is likely to be a few months from now. These were strongly positive on a m/m basis, but several showed deceleration YoY.
- the average manufacturing workweek was unchanged at 40.7 hours. This is one of the 10 components of the LEI. It is down -0.6 hours from its peak during this expansion.
- Manufacturing jobs rose by 4,000. YoY manufacturing is up 204,000, a big deceleration from last summer’s pace.
- construction jobs rose by 33,000. YoY construction jobs are up 256,000, also a big deceleration from last summer. Residential construction jobs, which are even more leading, however, actually declined by -2500, a signal that the housing slowdown from last year has finally bled through into jobs.
- temporary jobs rose strongly by 17,900. YoY these are up +53,500.
- the number of people unemployed for 5 weeks or less declined by -222,000 from 2,126,000 to 1,904,000. This is a new post-recession low.
Here are the headlines on wages and the broader measures of underemployment:
- Not in Labor Force, but Want a Job Now: declined by -106,000 from 5.227 million to 5.121 million
- Part time for economic reasons: rose by 155,000 from 4.499 million to 4.654 million
- Employment/population ratio ages 25-54: down -0.1% from 79.8% to 79.7%
- Average Hourly Earnings for Production and Nonsupervisory Personnel: rose $.07 from $23.24 to $23.31, up +3.4% YoY. (Note: you may be reading different information about wages elsewhere. They are citing average wages for all private workers. I use wages for nonsupervisory personnel, to come closer to the situation for ordinary workers.)
- Overtime was unchanged at 3.4 hours.
- Professional and business employment (generally higher-paying jobs) increased by 76,000 and is up 535,000 YoY. This has decelerated slightly from last year’s pace.
- the index of aggregate hours worked for non-managerial workers rose by 0.2%
- the index of aggregate payrolls for non-managerial workers rose by 0.5%
SUMMARY: There was another major disconnect between the headline jobs and unemployment numbers and the rest of the report. Let me start with the additional good stuff. Temporary help and construction jobs rose stoutly, the former very much at odds with the private weekly data. Short term unemployment fell to a new low. Services employment in general was very strong. Aggregate hours and payrolls for non-supervisory workers rose strongly again.Now, the negatives. Residential construction jobs declined. Involuntary part-time employment rose, a sign of some fraying at the edges. Both the labor force participation rate and the prime age employment to population ratio fell. In other words, the unemployment rate fell because there were fewer people in the labor force. But the biggest negative is the fact that the employment as measured by the household report declined for the third time in four months, is down for the year, and is up only 63,000 for the past six months. Note that this survey was taken during the week when we had record low new jobless claims. In the two weeks since, those have jumped. I suspect we may see some similar payback in next month’s jobs report as well. So while we can celebrate the good headline and wage numbers, there are substantial signs of fraying around the edges.
Here’s where the jobs are — in one chart - Job gains in the services sectors continued to rocket higher in April as hiring remained hot for computer system designers, social workers and health-care professionals. Manufacturing, on the other hand, posted a third straight month of lackluster employment figures.CNBC studied the net changes by industry for April jobs based on the data from the Labor Department contained in the jobs report released Friday. The government said the U.S. economy added 263,000 jobs last month, more than the 190,000 increase expected by economists polled by Refinitiv.The business and professional services sector alone added 76,000 jobs, with strong hiring in computer systems design, temporary help services and building and dwelling services like pest extermination, landscaping and housekeeping. The sector also includes lawyers, accountants and consultants.The health care sector — a consistent employment juggernaut — came in at second place with a gain of 62,000 jobs. Ambulatory care including outpatient medical services, hospitals, and nursing and residential care facilities accounted for more than 50,000 of that gain.The manufacturing industry, a priority for President Donald Trump, failed to post a robust rebound in April after an anemic showing in March. The sector added just 4,000 jobs last month versus March’s zero growth and February’s 8,000 gain.“Total nonfarm payroll employment increased by 263,000 in April, compared with an average monthly gain of 213,000 over the prior 12 months,” the Labor Department said in a release. “In April, notable jobs gains occurred in professional and business services, construction, health care, and social assistance.”Leisure and hospitality had a healthy net job gain of 34,000 thanks to a surge in employment adds in the food service industry. That just tops March’s 33,000 gain. Retail trade employment shed 12,000 jobs following a loss of 15,000 jobs in March.
Jobs report: no one wants to be incautious re inflation, but…Laissez les bon temps rouler! - Jared Bernstein - Payrolls rose by a larger-than-expected 263,000 last month and unemployment rate ticked down to a 49-year low of 3.6 percent. Yearly wage growth held steady at 3.2 percent, which is also its average over the past 12 months (raising the question: are wage gains on pause?). Since consumer inflation is running at around 2 percent, this implies real wage gains of a bit more than 1 percent, a welcome development for workers who are clearly benefiting from the persistently tight job market (see more on the wage story below). The tick down in the unemployment rate is not, however, as positive a sign as it appears to be, because it fell in April for the “wrong” reason: people leaving the labor market, not people getting jobs. This negative change should be discounted because the household survey (from which the unemployment and labor force rates are derived) carries a lot more statistical noise than the payroll survey (the 90 percent confidence interval for payroll employment is 110,000; for the HH survey, it’s over 500,000). Our monthly smoother, which averages monthly job gains over 3, 6, and 12 month intervals, shows that the recent trend in monthly gains is a relatively low 169,000, but because this value is influenced by the unusually low February gain of 56,000, the other bars are more representative of the underlying trend of a bit north of 200,000 per month. That’s a very solid number for this stage in our 10-year-old expansion, suggesting a virtuous cycle wherein strong labor demand is providing many working families with jobs and wage gains, which in turn fuels robust consumer spending. Remember, such spending comprises about 70 percent of our GDP, meaning that barring an unforeseen negative shock, these solid labor market dynamics should keep the recovery rolling for the near/medium term. It is also important to recognize that employers’ demands for more workers are being met by ample labor supply (again, discounting the April HH labor force decline). That implies less inflationary pressure, supporting the patient stance by the Federal Reserve. That is, jobs, wage, and inflation numbers all point to an economy that is certainly closing in a full capacity but still has “room-to-run.” There’s been renewed attention on wage gains in recent weeks, as tight labor markets and, at the low end of the pay scale, higher minimum wages in some places, have helped boost worker pay. The next two figures show the yearly percent gains in hourly wages for all private sector workers and for middle-wage workers (the 82 percent of the non-government workforce that hold production, non-supervisory jobs). They clearly show the aforementioned acceleration but if you look carefully at the end of each series (i.e., the series themselves, not the smoothed trend) they haven’t accelerated in the past 6 months. This bears watching as it could suggest a ceiling on wage growth of around 3 percent. In theory, that ceiling be explained by the sum of productivity growth of 1 percent and inflation of 2 percent. However, truly strong worker bargaining clout would mean faster wage gains supported by a squeeze on corporate profits, i.e., diminished inequality. Thus, while one obviously doesn’t want to be incautious regarding the possibility of future inflationary pressures, the correct monetary policy for the moment is the one they talk about down in New Orleans: Laissez les bon temps rouler!
Comments on April Employment Report – McBride - The headline jobs number at 263 thousand for April was above consensus expectations of 180 thousand, and the previous two months were revised up 16 thousand, combined. The unemployment rate declined to 3.6%. Overall this was a strong report. In April, the year-over-year employment change was 2.620 million jobs. That is solid year-over-year growth. Wage growth was close to expectations. From the BLS: "In April, average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents to $27.77. Over the year, average hourly earnings have increased by 3.2 percent."This graph is based on “Average Hourly Earnings” from the Current Employment Statistics (CES) (aka "Establishment") monthly employment report. Note: There are also two quarterly sources for earnings data: 1) “Hourly Compensation,” from the BLS’s Productivity and Costs; and 2) the Employment Cost Index which includes wage/salary and benefit compensation. The graph shows the nominal year-over-year change in "Average Hourly Earnings" for all private employees. Nominal wage growth was at 3.2% YoY in April. Wage growth has generally been trending up. Since the overall participation rate has declined due to cyclical (recession) and demographic (aging population, younger people staying in school) reasons, here is the employment-population ratio for the key working age group: 25 to 54 years old. In the earlier period the participation rate for this group was trending up as women joined the labor force. Since the early '90s, the participation rate moved more sideways, with a downward drift starting around '00 - and with ups and downs related to the business cycle. The 25 to 54 participation rate was declined in April at 82.2% from 82.5% in March, and the 25 to 54 employment population ratio was decreased to 79.7%. The number of persons working part time for economic reasons increased in April to 4.654 million from 4.499 million in March. The number of persons working part time for economic reason has been generally trending down. These workers are included in the alternate measure of labor underutilization (U-6) that was unchanged at 7.3% in April. This graph shows the number of workers unemployed for 27 weeks or more. According to the BLS, there are 1.230 million workers who have been unemployed for more than 26 weeks and still want a job. This was down from 1.305 million in March. Summary: The headline jobs number was above expectations, and the previous two months were revised up slightly. The headline unemployment rate declined to 3.6%. This was a strong jobs report. The economy added 820 thousand jobs through April 2019, down from 879 thousand jobs during the same period in 2018. So it appears job growth has slowed somewhat, but is still solid. The decline in the participation rate lowered the unemployment rate. Note that sometime soon the overall participation rate will start another steady decline due to demographic factors. The overall participation rate has been moving sideways for several years, as the expansion has offset the demographics factors.
Unit Labor Costs Unexpectedly Tumble In Q1 As 'Productivity' Surges Most In 9 Years - Good news America - productivity is surging at its fastest rate in nine years. Bad news - it's on the back of lower labor costs. Theoretically, they are close to the mirror of one another in a stable world (a rise in one necessarily means the inverse in another) and US productivity in Q1 soared 3.6% QoQ - the biggest QoQ rise since Q3 2014 Driven by the fact that Unit labor costs fell 0.9% in 1Q vs. up 2.5% prior quarter (Output rose 4.1% in 1Q vs. up 2.6% prior quarter, Employee hours rose 0.5% in 1Q vs. up 1.3% prior quarter, and nominal compensation rose 2.6 percent, the least in three quarters). On a year-over-year basis, productivity rose 2.4% - the largest rise since Q3 2010... ...While labor costs advanced 0.1%, the least since 2013. Bloomberg notes that it will still probably take more time to determine whether productivity is enjoying persistent increases after relatively slow gains throughout the current expansion, with an average of 1.3 percent from 2007 to 2018. Fed Chairman Jerome Powell on Wednesday brushed aside pressure for an interest-rate cut and said productivity is partly driven by technology developments and very hard to predict. Today's report showed output rose at a 4.1 percent pace, while hours worked increased 0.5 percent; that gain was last slower in 2015.
Trump’s labor department moves to designate gig economy workers as “independent contractors”- The Trump administration is moving rapidly to back so-called Gig Economy companies, which deliberately misclassify their employees as “independent contractors” in order to circumvent minimum wage, overtime and other longstanding federal labor laws. In an open opinion letter released Monday, the US Department of Labor (DOL) sided with an unnamed company, which connects consumers to house cleaners. The company asked the Labor Department’s Wage and Hour Division for clarification on whether it could designate its employees as independent contractors. The letter, signed Keith E. Sonderling, the acting administrator for department’s Wage and Hour Division, provides a series of specious arguments to justify classifying the company’s workers as independent contractors. The letter claims the housekeeping workers essentially “work for themselves” and are not employees because there are no limitations or restrictions from the company on the hours they can work or to prevent them from working for competitors.It also said the workers were not “permanent” because they were free to leave the company as they choose and free to use their own “facilities and equipment.” The letter also cited the “lack of integration” between the unnamed company in question and the workers who use the company to find work.“This DOL opinion letter is a cynical interpretation of employment law,” said Rebecca Smith, a spokesperson for the National Employment Law Project, which has exposed wage theft and other abuses of contract and temporary workers. “Whatever gig company sought the opinion will likely use the letter as a free pass to argue that it acted in good faith in classifying its workers as contractors—even when its actions fail to satisfy the traditional legal test for determining employment status.”
Millions of workers are paid less than the “average” minimum wage --Last week, the New York Times published an article in “The Upshot” by Ernie Tedeschi, which argues that after accounting for state and local minimum wages, the United States currently has its highest average effective minimum wage ever at $11.80 per hour. The article correctly underscores how after 10 years of inaction at the federal level, so much of the policy work being done to boost wages for low-wage workers is happening at the state and local level. Yet, it is important to recognize that even with state and local governments taking action in many places, there are still millions of workers being paid significantly lower wages than the “average” minimum wage as calculated in the Upshot piece. In fact, raising the federal minimum wage to $11.80 would directly lift wages for 18.6 million workers, or 12.8 percent of the wage-earning workforce. Moreover, calculating the average effective minimum wage is very sensitive to how one defines the workforce affected by the policy. One would arrive at a much lower average minimum wage if considering the broader low-wage workforce for whom minimum wage policy is relevant. The Upshot piece explores how the share of workers being paid exactly the federal minimum wage is relatively small. There are two reasons why this is the case. First, the article observes that 89 percent of minimum-wage workers are paid more than the federal $7.25, because 29 states and some 40+ cities and counties have set their own minimum wages above the federal floor. Higher state and local minimum wages—all of which can be found in EPI’s Minimum Wage Tracker—are the result of federal inaction and also due to the tremendous success of the Fight for 15 movement in raising awareness about low wages and pushing for minimum wage increases across the country. Second, the share of workers being paid the federal minimum wage potentially overlooks millions of workers in states with low minimum wages who are earning only somewhat above the required federal minimum. For example, in Texas, a state stuck at the federal minimum wage, 2.7 percent of workers reported earning less than $7.50 per hour last year. But four times as many workers in Texas, or 11.0 percent, earned less than $10.00 per hour. This contrasts sharply with California, where there are higher state and local minimum wages: there, only 3.8 percent of the workforce reported earning less than $10.00 per hour last year. (These calculations use Current Population Survey data.)
Want to decrease suicide? Raise the minimum wage, researchers suggest -What some experts call "deaths of despair" -- fatalities related to alcohol, drugs and suicide -- have risen in recent years among Americans without a college degree, contributing to a decline in life expectancy in the U.S. Now new research suggests a way to deter people from killing themselves: pay them more.Increasing the minimum wage by 10 percent reduces suicides among adults with a high school degree or less by 3.6 percent, according to a study published by the National Bureau of Economic Research. A 10 percent hike in the Earned Income Tax Credit -- a federal subsidy for low-income families -- reduces suicides among the same group by 5.5 percent. Increasing both measures by 10 percent would prevent a total of 1,230 suicides per year, Notably, the study posits a direct causal link between people's wages and suicide rates. That goes further than most other previous research, which generally only suggests a link between the minimum wage and suicide. "The minimum wage and the EITC represent the two most important policy levers for raising incomes for low-wage workers. Yet no one has previously examined the causal effects of these two policies on suicides and drug deaths -- a huge knowledge gap," the study states. By contrast, increasing pay and federal aid for lower-income workers didn't significantly reduce drug-related deaths, the researchers found. An increase in the minimum wage was linked to an immediate decrease in suicides, while raising the EITC had a delayed effect, resulting in fewer suicides the following year, said Anna Godoy, one of the paper's authors and a labor economist at the University of California, Berkeley.
Thousands Die, Millions Injured on the Job, and No Businesses Prosecuted - NEP’s Bill Black appears on The Real News Network and describes how OSHA’s few underfunded inspectors can’t do their jobs, and prosecutors don’t prosecute businesses for non-compliance. You can view here with a transcript.
Recovery- New York City Homelessness Is The Worst It Has Ever Been --The mainstream media continues to try to convince all of us that the U.S. economy is “booming”, but meanwhile the number of homeless people is setting all-time record highs in major cities all over the nation. The recent article that I published about how wealthy elitists on the west coast are freaking out as hordes of homeless people take over their neighborhoods received a tremendous amount of attention, but nobody has a worse problem with homelessness than New York City does. According to the Department of Housing and Urban Development, approximately 14 percent of all the homeless people in the entire country currently live in New York City… According to the Department of Housing and Urban Development’s most recent assessment report, the number of people experiencing homelessness has been rising. The HUD’s annual survey found that on a single night in January 2018, there were a total of 552,830 homeless people across the country. New York City had 78,676 — or about 14 percent of the nation’s homeless population.That number, 78,676, was a brand new all-time record high.And more records are being broken during the early part of this year.On Tuesday, the Coalition for the Homeless issued a brand new State of the Homeless report for 2019. According to that report, the number of people living in homeless shelters in New York City has been breaking record after record…If found that in February 2019, an average of 63,615 men, women, and children slept in New York City shelters each night, just shy of the all-time record set in January.While the number of families decreased slightly, the number of homeless single adults continues to increase.An all-time record 18,212 single adults slept in shelters each night in February 2019, up 150 percent from 2009. Between September 2018 and April 2019, the number of single adults in DHS shelters reached a new nightly record high 32 times, according to the report.
We Need To Take Action Now- LA Homeless Deaths Jump 76% -- Kaiser Health News reports that a record number of homeless people died across Los Angeles County last year, on bus benches, parks, hillsides, railroad track, and sidewalks.Deaths skyrocketed 76% in the last five years, far outpacing the growth in the city's homeless population. As of 2018, the city's total homeless population was about 53,000, an increase of 39% since 2014. The study said a majority of the people weren't living in government shelters but rather on city streets. Government officials and so-called experts have limited understanding of what the primary cause for the rise in deaths, but they said the opioid crisis could be a significant reason. An increase in deaths outlines that Los Angeles County, a region of more than 10 million inhabitants, is in the midst of a homelessness crisis. Based on that criteria, the Los Angeles County Department of Medical Examiner-Coroner reported 3,612 deaths of homeless people from 2014 to 2018. A closer examination of the deaths revealed where the homeless were dying.About 33% died in hospitals and more than two-thirds died outside, in places like alleyways, sidewalks, parking lots, tent cities, parks, railroad tracks, and on freeway on-ramps.Male deaths were much higher than female deaths, the study noted. Even though African Americans make up fewer than 10% of the county’s population, they accounted for 25% of the homeless deaths.Substance abuse played a primary role in at least 25% of the deaths over the last five years, according to the coroner’s data.The coroner’s exact cause of death "doesnt necessarily tell the whole story," said Brian Elias, the county’s chief of coroner investigations, who was alarmed by the surge in homeless deaths.Dr. Paul Gregerson, chief medical officer for JWCH Institute clinics in the Los Angeles area, provides medical assistance to the homeless, says that many of the disadvantage people died from heart disease, cancer, lung disease, diabetes, and infections. There has also been a sharp increase in deaths of millennials who were homeless. For instance, the deaths associated with adults under 40 - more than doubled.
Amazon’s facial-recognition technology is supercharging local police - When workers at an Ace Hardware here reported that a woman had walked out of the store with an $11.99 tank of welding gas that she hadn't paid for in her tote bag, an elaborate high-tech crime-fighting operation sprang into action. A Washington County sheriff's detective, working with the agency's Special Investigations Unit, ran the store's surveillance footage through an internal facial-recognition program built by Amazon, revealing a possible match. That woman's license plate was flagged and, three months later, a narcotics officer in an unmarked SUV saw it and radioed other patrol deputies to stop her. A deputy clapped a pair of handcuffs around her wrists, an arrest report states. She said she'd needed the gas to fix her car. Deputies in this corner of western Oregon outside ultraliberal Portland used to track down criminals the old-fashioned way, faxing caught-on-camera images of a suspect around the office in hope that someone might recognize the face. Then, in late 2017, the Washington County Sheriff's Office became the first law enforcement agency in the country known to use Amazon's artificial-intelligence tool Rekognition, transforming this thicket of forests and suburbs into a public testing ground for a new wave of experimental police surveillance techniques. Almost overnight, deputies saw their investigative powers supercharged, allowing them to scan for matches of a suspect's face across more than 300,000 mug shots taken at the county jail since 2001. A grainy picture of someone's face - captured by a security camera, a social media account or a deputy's smartphone - can quickly become a link to their identity, including their name, family and address. More than 1,000 facial-recognition searches were logged last year, said deputies, who sometimes used the results to find a suspect's Facebook page or visit their home.
The Essence of Evil: Sex With Children Has Become Big Business in America --Sex trafficking—especially when it comes to the buying and selling of young girls—has become big business in America, the fastest growing business in organized crime and the second most-lucrative commodity traded illegally after drugs and guns. As investigative journalist Amy Fine Collins notes, “It’s become more lucrative and much safer to sell malleable teens than drugs or guns. A pound of heroin or an AK-47 can be retailed once, but a young girl can be sold 10 to 15 times a day—and a ‘righteous’ pimp confiscates 100 percent of her earnings.” Consider this: every two minutes, a child is exploited in the sex industry. According to USA Today, adults purchase children for sex at least 2.5 million times a year in the United States. Who buys a child for sex? Otherwise ordinary men from all walks of life. “They could be your co-worker, doctor, pastor or spouse,” writes journalist Tim Swarens, who spent more than a year investigating the sex trade in America. In Georgia alone, it is estimated that 7,200 men (half of them in their 30s) seek to purchase sex with adolescent girls each month, averaging roughly 300 a day. On average, a child might be raped by 6,000 men during a five-year period of servitude. It is estimated that at least 100,000 children—girls and boys—are bought and sold for sex in the U.S. every year, with as many as 300,000 children in danger of being trafficked each year. Some of these children are forcefully abducted, others are runaways, and still others are sold into the system by relatives and acquaintances.“Human trafficking—the commercial sexual exploitation of American children and women, via the Internet, strip clubs, escort services, or street prostitution—is on its way to becoming one of the worst crimes in the U.S.,” said prosecutor Krishna Patel. This is an industry that revolves around cheap sex on the fly, with young girls and women who are sold to 50 men each day for $25 apiece, while their handlers make $150,000 to $200,000 per child each year. It is estimated that there are 100,000 to 150,000 under-aged child sex workers in the U.S. These girls aren’t volunteering to be sex slaves. They’re being lured—forced—trafficked into it. In most cases, they have no choice. No doubt about it: this is a highly profitable, highly organized and highly sophisticated sex trafficking business that operates in towns large and small, raking in upwards of $9.5 billion a year in the U.S. alone by abducting and selling young girls for sex.
Who buys a trafficked child for sex- Otherwise ordinary men - This is the first of 10 columns in the EXPLOITED series, which explores the cultural and economic forces that contribute to commercial sexual exploitation. On the day she met Marcus Thompson, the girl later told the FBI, she had been ready to leap from a bridge to end her life. She was only 15, pregnant and alone on the streets. And in this wounded child, Thompson saw a means to make money. He promised that if she left her small Illinois town with him, he would make her a model. Grasping for hope, she climbed into his truck. But the promise was a lie. Instead, in the summer of 2015, Thompson and his wife, Robin, forced the girl on a nightmarish six-week trek across the southern United States. Photographed in suggestive poses and marketed online, she was sold out of hotel rooms and truck stops to any man with the money and the desire to buy sex. The justice system eventually would work well in this case in several respects. The victim was rescued and provided with treatment. The traffickers who exploited her were caught, pleaded guilty and were sent to prison. But what of the men who paid to rape this child? What consequences did they suffer? Not a single one was ever charged. That same breach of justice is the norm in thousands of trafficking cases. About 10,000 children a year suffer the horrors of commercial sexual exploitation in the United States. Each victim on average is forced to have sex more than five times a day. Yet the buyers who fuel the child sex trade are seldom held accountable. Most just blend back into their families, jobs and neighborhoods. Until the next time.
Teen suicides spiked month after Netflix’s drama ’13 Reasons Why’ premiered - Suicide rates for teens saw a sharp increase in the month following the release of the Netflix drama “13 Reasons Why,” according to a study published Monday. “13 Reasons Why,” based on a 2007 novel of the same name by author Jay Asher, follows a 17-year-old high school student whose friend kills herself after facing bullying and sexual assault. Researchers at the Nationwide Children’s Hospital analyzed monthly rates of suicides among individuals ages 10 to 64 between Jan. 1, 2013, and Dec. 31, 2017. They said April 2017, the month after the Season One premiere of “13 Reasons Why,” had the highest suicide rate among ages 10 to 17, increasing by 28.9%. The study, published in the peer-reviewed Journal of the American Academy of Child & Adolescent Psychiatry, also found that there were about 195 more youth suicides than expected in the nine months following the March 31, 2017 release. “Youth may be particularly susceptible to suicide contagion, which can be fostered by stories that sensationalize or promote simplistic explanations of suicidal behavior, glorify or romanticize the decedent, present suicide as a means of accomplishing a goal, or offer potential prescriptions of how-to die by suicide,” said Jeff Bridge, director of the Center for Suicide Prevention and Research at Nationwide Children’s and the lead author of the study.
Kids' Extracurricular Activities Are Burying Parents Under A Mountain Of Debt - The extracurricular activities that used to just be "good old-fashioned fun" are now mandatory pieces to a college resume for kids. And the cost of these activities is pushing parents deep into debt and compromising them financially, according to MarketWatch. 8 in 10 parents in a new survey said that they’re hoping that signing kids up for extracurricular activities could help them bring in extra income someday. 66% of these parents have gone into debt to pay for things like soccer, ballet, dancing, and piano lessons.CompareCards.com surveyed more than 700 parents with young children who participate in extracurricular activities. The more the parents spent, the more they believed that these activities would literally "pay off" in the long run. 90% of parents who dropped at least $4,000 a year believed their kid would earn money from that activity in the future, compared to 75% of parents who spent less than $1,000 who said the same. Matt Schulz, chief industry analyst at CompareCards, said: “And what the survey showed is, it’s not just sports parents who have these big dreams and big hopes for their sons and daughters; it’s music parents, it’s cheerleading parents, it’s debate team parents.” The most popular activities included sports, reported by 30% of parents, music (16%), dance (15%), gymnastics (12%), cheerleading (9%), martial arts (8%), beauty pageants (3%) and debate teams (3%). 46% of parents said they spent more than $1000 annually and 27% said they’re spending more than $2000 quarterly. This survey supports a University of Michigan poll that found 55% of parents said that school sponsored sports teams and extracurricular activities helped boost their child’s college application. Three times as many low income parents as high income said that the benefits of these activities are not worth the cost, indicating that the survey was skewed towards affluent parents. 62% of parents revealed they’ve actually gone into debt for their children’s activities and 33% of them are still paying off related debt. Almost 1 in 10 parents of those in debt owe more than $5000 and 27% owe more than $3000 in debt. “They do hope that perhaps those efforts in terms of time and money may be rewarded with maybe a scholarship, or maybe a professional career,” Schulz continued. Families can wind up spending more than $200,000 in total on private school tuition, SAT tutors, living in a certain school district and these extracurricular activities to help groom their kids for getting into a good college.
The Climate Change Generation Needs to Know What's Coming - The fossil fuel industry’s decades-long campaign to build political power and spread disinformation about climate change is well-documented. Their strategy of denying the causes of climate change has been wildly lucrative for the fossil fuel industry, but devastating for our environment and democracy.As kids across the U.S. and around the globe rise up to demand action, this disinformation campaign is now being targeted at America’s classrooms.A spate of bills introduced in states across the country would either prohibit teachers from discussing climate change in their classrooms or require public school teachers to present “both sides” of an issue that has come to dominate American political discourse. This would give science equal weight with flat-out propaganda.This assault on our children is reprehensible for so many reasons. To start with an obvious one, it is keeping kids in the dark about an urgent global problem that will affect the rest of their lives. To present rigorous scientific evidence alongside self-interested corporate propaganda equates truth with lies and blurs fact and fiction.Misinformation is a tool of oppression and it has no place in classrooms. Furthermore, presenting information to our kids through the lens of partisan politics corrupts the goals of education. It deadens critical thinking skills and instead nudges children toward ideological, rather than fact-based, decision making. It divides our communities. It teaches kids to distrust, to bend facts to their preferences, rather than to inquire, test and seek truth. It does the subtle work of hemming in their imaginations to align more closely with the agenda of special interests and the politicians that do their bidding. Many teachers are already hesitant to talk about climate change. Some describe fear of backlash from parents. The reality—according to recent polling —is that the overwhelming majority of parents want their kids to know what scientists have to say about climate change. That includes two-thirds of Republican parents. But saber-rattling by elected officials creates a chilling effect that ripples all the way into our kids’ schools. Even if the bills don’t move forward, the simple act of introducing them works to suppress information and hinder awareness.
New York pre-K teachers demand pay parity, as union seeks to sabotage strike - Eight thousand of New York City’s early childhood education teachers, those working for community-based organizations (CBOs) or Head Start, have voted to authorize a strike on Thursday, May 2. Their immediate demand is for wage parity with prekindergarten (pre-K) educators in the public schools. With a walkout by pre-K teachers threatening to develop into a direct conflict with the Democratic Party and Mayor Bill de Blasio, AFSCME District Council 1707, which like the rest of the municipal unions is closely allied with the Democrats, is sabotaging the strike mobilization. The union has told half of the teachers, those employed by CBOs and members of AFSCME Local 205, not to strike, but instead to hold a one-day protest, leaving the 3,000 educators who work for Head Start (Local 95 members) to strike alone. Instead of uniting the working class—parents, school bus drivers, school staff and other workers—behind these embattled educators, the union has scheduled a rally for noon on Thursday at City Hall, where union officials hope to limit teachers to impotent appeals to Mayor de Blasio. AFSCME officials have cited the state’s reactionary anti-strike Taylor Law, which they say governs Local 205, as an excuse to capitulate. The union has long segregated the plight of notoriously underpaid early childhood educators from New York City teachers as a whole. News reports, however, indicate that the thousands of teachers in the CBOs, as well as many nonunion teachers, may strike anyway, despite the reactionary machinations of the unions. “It’s an action that’s coming from the workers,” said Gregory Brender, United Neighborhood Houses co-director of policy. Other non-profit CBOs indicated their support to the teachers, “I absolutely support the right of our teachers to go out on strike to achieve what I truly believe is rightly theirs,” said Alan van Capelle of the Educational Alliance. “I’m sick and tired of our agency and our talented staff doing the work, and not getting adequately compensated.”
US teachers in the Carolinas to hold mass protests on May Day - Teachers in North and South Carolina are planning walkouts and demonstrations on Wednesday, May 1. Like teachers throughout the country and internationally, they are protesting overcrowded and underfunded classrooms, inadequate pay, poor working conditions, and a lack of support staff. North Carolina teachers are also demanding that the Republican-controlled state legislature expand Medicaid for low-income students. School districts in both states have been forced to close most schools Wednesday because there are not enough substitute teachers to staff classrooms safely. The simultaneous eruption of teachers struggles in the Carolinas occurs against the backdrop of a continuing wave of teacher strikes and protests around the globe. In 2018, 379,000 teachers went on strike in the US, with educators making up the bulk of the record number of striking workers since 1986. Over 70,000 have gone on strike so far this year, including in West Virginia, Denver, Colorado and Los Angeles, Oakland and Sacramento, California. . According to press reports at least 31 school districts and four charter schools representing a majority of North Carolina’s 1.53 million public school students have canceled classes and thousands of teachers are expected in the state capital of Raleigh on Wednesday. At least two districts—Dorchester 2 and Chester County schools—and Palmetto Scholars Academy charter school in North Charleston have announced they are closing, with more expected today and tomorrow. Like their counterparts around the US, educators in both North and South Carolina are battling a bipartisan attack on public education. The General Assembly (state legislature) in North Carolina is controlled by the Republicans, but the governor, Roy Cooper, is a Democrat and his party has controlled the governor’s office for 21 of the last 25 years. The state is 39th in the nation in per pupil spending.
30,000 march for public education in North and South Carolina - Tens of thousands of educators and their supporters marched in Raleigh, North Carolina and Columbia, South Carolina yesterday to protest low wages and abysmal public-school funding in the two states. North Carolina educators have seen a decline of 9.4 percent in real wages since 2009, and the state ranks 39th in the nation in per pupil funding. South Carolina ranks 38th in teacher pay and 31st in funding. Organizers estimated that more than 20,000 marched in North Carolina and 10,000 in South Carolina. So many teachers, counselors, school bus drivers and other school support staff in North Carolina called off Wednesday that classes were cancelled for more than 850,000 of the state’s 1.5 million public school students. Inspired by teachers in the neighboring state and organized on social media in less than two weeks, the South Carolina protests, one of the largest in the state capital in recent memory, forced seven school districts to cancel classes due to a lack of substitute teachers. The mass protests in the Carolinas are part of a continuing wave of teacher struggles that began last year with wildcat strikes in West Virginia and continued with walkouts in Los Angeles, Oakland, Sacramento, and Denver this year. More than a 100 charter school teachers walked out of four schools in Chicago yesterday, and teachers in the California capital of Sacramento are set to carry out a one-day strike on May 22.
'We Teach, We Vote!': 10,000 Teachers Rise Up Against Republican Legislature in Deep Red South Carolina - Demanding an end to austerity measures that have kept classrooms overcrowded and educators underpaid, about 10,000 teachers, students, and supporters staged one of the largest protests in recent years at the South Carolina Statehouse in Columbia on Wednesday.Led by the grassroots group SC for Ed, teachers from across the traditionally deep red state took personal days to stage the walkout. The protest is aimed at forcing the Republican-controlled legislature to fund higher wages and more hiring in order to reduce class sizes and staff schools with support staff."For too long we have allowed our schools to go underfunded while taking the blame for the host of issues that come with that," SC for Ed said in a statement Wednesday. "We hope the state of South Carolina will commit to starting over the process of reform with current classroom teachers at the table."Many of the teachers chanted, "We teach, we vote" as they marched to the Statehouse Wednesday morning.Former educator Sariah McCall, who cited a chronic lack of resources when she resigned from her job at Charleston County School District in November, was among the speakers at the rally.McCall's resignation letter was printed in the Washington Post last month. "The public has to demand that they receive the time, funding, and resources they require," McCall wrote. "We need to prioritize education, not just offer it lip-service. Until enough people decide that this is worth making a fuss over, those that are in power have no reason to listen to our hurt, pleas, and fears to make any changes."
Year after Arizona strike, teacher walkouts and protests spread in US - Thousands of teachers and their supporters are expected to attend protests in the state capitals of North Carolina (Raleigh) and South Carolina (Columbia) on Wednesday, May 1 to demand increases in wages and school funding, the hiring of more staff and other improvements for their students. The protests in the Carolinas, which take place a year after nearly 60,000 Arizona teachers struck, are part of the wave of strikes and demonstrations by educators in the US and internationally that began in 2018 and are continuing this year. More than 300,000 Polish teachers returned to classrooms this week after carrying out a 17-day nationwide strike, their first in decades, to demand a 30 percent wage increase. Teachers won enormous popular support. . According to reports, protests by North Carolina’s teachers will cancel classes for half of the state’s 1.53 million public school students. Last May, 20,000 teachers rallied in the Capitol, but the meager increases approved by the state’s Democratic governor and Republican-controlled legislature still leave their pay well below the national average. The state is 39th in the nation in per pupil spending. South Carolina teachers are demanding a 10 percent salary increase, smaller class sizes and uninterrupted planning time. They have denounced the “insufferable and oppressive working conditions” endured by teachers whose starting pay is $32,000, not much more than the federal poverty threshold of $25,750 for a family of four. In addition to these protests, thousands of other teachers are preparing strikes and demonstrations in several US cities.
- • In Chicago, City College clerks and technical workers are set to strike Wednesday, May 1, if no agreement is reached for workers who have not had a contract in three years. Another 130 teachers at five charter schools could strike at the end of the school day Wednesday, with teachers at another five charters possibly joining the strike. The labor agreement covering more than 20,000 Chicago Public Schools teachers expires on June 31.
- • In New York City, thousands of pre-kindergarten teachers are set to strike on Thursday, May 2, to demand higher wages. The pre-school teachers are in a fight against Democratic Mayor Bill de Blasio, who has contracted out early childhood programs to privately run “community-based organizations,” which pay teachers substantially less than their public-school counterparts.
- • In Detroit, teachers are planning to protest the May 14 school board meeting to oppose the addition of five unpaid days to their 2019–2020 school calendar and district plans to implement a merit pay system. In 2016, hundreds of Detroit teachers launched a series of wildcat “sickouts” in defiance of the Detroit Federation of Teachers, which brought to national attention the horrific conditions in the schools, including black mold, rodents and crumbling infrastructure.
Chicago’s Historic Charter School Strike Wave Keeps On Winning -Chicago charter teachers are racking up firsts. In December 2018, Chicago saw the first-ever walkout at a charter network in the United States. And on Thursday, teachers employed by two other private operators launched the nation’s first multi-employer charter school strike. “We’ve been bargaining since last summer, and the process has been insulting to educators,” said Carlene Carpenter, a social studies teacher at the Latino Youth High School (LYHS), which is affiliated with the Youth Connection Charter School network. “If charter operators really cared about education, we wouldn’t be here today.”The past six months have seen more than 700 charter teachers at 22 different campuses walk off the job over stalled contract negotiations. All of them are represented by the Chicago Teachers Union’s recently formed charter division, which has been bargaining with teachers at 11 different operators using a set of common demands hashed out last spring. Key issues include pay bumps for charter teachers and support staff, who are typically paid less than their counterparts in district-run schools, as well as caps on class sizes, and more counselors and mental health supports for students.At the end of the school day Wednesday, charter teachers from across the city held a May Day rally at the Chicago High School for the Arts (ChiArts), a school that operates privately on a contract with the district. That makes it technically distinct from an independently chartered school, putting it in a gray area that the union says school administration has exploited in order to skirt regulations and avoid paying into the teachers’ pension fund.Comparatively low pay and benefits have resulted in high turnover and the disruption of students’ education, said Emily Maassen, a ChiArts teacher who spoke at the rally. “Educators leave and they’re replaced by a computer program,” she said, referring to an online learning program used in the school. Early Thursday morning, ChiArts settled a contract with the union, narrowly avoiding a walkout. (Details of the agreement were not immediately available.) Another school, Youth Connection Leadership Academy in the city’s Bronzeville neighborhood, also reached an agreement with teachers Wednesday. But at Latino Youth High School, as well as two schools run by the non-profit Instituto del Progreso Latino, which serve about 1,000 predominantly Latinx students from the city’s south and west sides, negotiations stalled, resulting in walkouts.
In Case Brought by School Speech Pathologist, Texas Federal Court Becomes the Third to Strike Down Pro-Israel Oath as Unconstitutional - A FEDERAL COURT IN TEXAS issued a ruling on Thursday afternoon preliminarily enjoining enforcement of Texas’ law banning contractors from boycotting Israel. The court ruled that the law plainly violates the free speech guarantee of the First Amendment. Following similar decisions by federal courts in Kansas and Arizona, the ruling becomes the third judicial finding – out of three who have evaluated the constitutionality of such laws – to conclude that they are unconstitutional attacks on the free speech rights of Americans. The case was brought by Bahia Amawi, a longtime elementary school speech pathologist in Austin, Texas, whose contract renewal was denied due to her refusal to sign an oath certifying that she does not participate in any boycotts of Israel. In December, The Intercept was the first toreport on her case and the lawsuit she brought, and also produced a video documenting her story: Amawi, a U.S. citizen and mother of four U.S.-born children, was required to sign the pro-Israel oath due to a new law enacted with almost no dissent by the Texas State Legislature in May 2017, and signed into law two days later by GOP Gov. Greg Abbott. When signing the bill, Gov. Abbott proclaimed: “Any anti-Israel policy is an anti-Texas policy.” But this was precisely the mentality, along with the virtually unanimous pro-Israel sentiment in the Texas State Legislature, that the Texas federal judge identified when explaining why the pro-Israel oath so blatantly violates the free speech guarantees of the U.S. Constitution’s First Amendment:
Progressives Take a Bold Stance at an Epicenter of the Charter School Movement to Score a Major Win for Public Education - The community that’s been on the frontline of the decades-long battle over privatizing public education the longest has been Milwaukee, where the city’s public schools have been undermined by a nearly 30-year-old voucher program—the nation’s oldest—and an invasion of charter schools going back to 1993, when the state passed its first charter school law just a year after the very first charter school law in the nation passed in Minnesota.Despite the decades-long effort to privatize Milwaukee’s local school, recent events in that community have revealed how public school advocates can successfully fight back against the forces of privatization.In Milwaukee’s recent school board election, a slate of five candidates swept into office under a banner of turning back years of efforts to privatize the district’s schools. The win for public schools was noteworthy not only because it took place in a long-standing bastion of school choice, but also because the winning candidates were backed by an emerging coalition that adopted a bold, new politics that demands candidates take up a full-throated opposition to school privatization rather than cater to the middle.Unsurprisingly, the coalition includes the local teachers’ union, who’ve long been skeptical of charters, vouchers, and other privatization ideas, but joining the teachers in their win are progressive activists, including the Wisconsin chapter of the Working Families Party, and local civil rights advocacy groups, including Black Leaders Organizing for Communities and Voces de la Frontera.Unifying this diverse coalition was an uncompromising political argument about what makes public schools truly public and why that distinction matters. “Our toughest challenge has been to educate voters on what is truly a public school,” Amy Mizialko, president of the Milwaukee teachers’ union, tells me in a phone conversation. “We’ve had to draw an extremely hard line” between public versus private, she says.This progressive coalition took this bold stance in Milwaukee because in Milwaukee the stakes are extraordinarily high. “Privatization is going to kill this city and take our students and the teaching profession with it,” says Mizialko.
Betsy DeVos Presents Teacher of the Year Award on Behalf of Trump (AP) -- Education Secretary Betsy DeVos has presented the National Teacher of the Year award to a Virginia educator who teaches at a juvenile detention center. DeVos on Monday honored Rodney Robinson and the state Teacher of the Year winners at a White House ceremony. Robinson teaches at a school inside the Richmond Juvenile Detention Center. The teaching award has been given since 1952 and is traditionally presented by the president. DeVos presented it Monday, but an Education Department spokeswoman says Trump and Vice President Mike Pence met with award winners in the Oval Office. Members of the press were barred from the ceremony.
Chinese Family Reportedly Paid $6.5 Million to Consultant for Spot at Stanford - From the day in March that prosecutors announced charges against 50 people in a sweeping college admissions fraud investigation, they have held out a tantalizing mystery: an unnamed family that they said had paid the college consultant at the center of the scheme $6.5 million — far more than any of the parents named in the case — to get their child into college. The student is Yusi Zhao, who was admitted to Stanford in 2017, according to a person with direct knowledge of the investigation. Neither she nor her parents, who live in Beijing, have been charged, and it is unclear whether they are currently being investigated. Stanford rescinded Ms. Zhao’s admission in April, and she is no longer a student there. The person with knowledge of the inquiry said that Ms. Zhao’s family was introduced to the college consultant, William Singer, by a financial adviser at Morgan Stanley based in Pasadena, named Michael Wu. A spokeswoman for Morgan Stanley said that Mr. Wu had been terminated for not cooperating with an internal investigation into the matter and that the firm was cooperating with the authorities. .At a court hearing in March, the lead prosecutor in the admissions case, Eric S. Rosen, said that Mr. Singer had tried to get Ms. Zhao — whom Mr. Rosen did not identify by name — recruited to the Stanford sailing team and created a false profile of her supposed sailing achievements. She was ultimately not recruited, but Mr. Rosen said that she was admitted to Stanford partly on the basis of those false credentials and that, after her admission, Mr. Singer made a $500,000 donation to the Stanford sailing program. Mr. Singer has pleaded guilty to racketeering and other charges, for masterminding a scheme that prosecutors say included both cheating on college entrance exams and bribing coaches to recruit students who were not actually competitive athletes.
L.A.’s Elite on Edge as Prosecutors Pursue More Parents in Admissions Scandal - NYT — Federal prosecutors are pursuing a new set of parents in the college admissions fraud scandal, sending ripples of fear through elite circles in Southern California and stirring speculation about which well-heeled executive or celebrity might be the next to be charged.The prosecutors have informed some of the parents — the exact number is unclear — that they are under investigation in the nation’s largest-ever college admissions inquiry, according to four defense lawyers. During a trip to Los Angeles in April, the lead prosecutor conferred with lawyers for at least two of these parents.At the same time, defense lawyers say that a larger array of parents is worried about also becoming a target, and is scrambling to hire lawyers and figure out what to do. And, even with these new lines of investigation underway, prosecutors said that they have sent target letters to three students, raising the prospect that the students could face criminal charges and compounding their families’ anxieties.William Singer, the college consultant at the center of the scheme, was based in Newport Beach, and many of his clients were in the Los Angeles area. Some of those clients are now grappling with a secret, nerve-racking waiting game, while fellow parents openly gloat about cheaters getting their due or whisper about which high school senior might have benefited from some shady help. “For many of these people, this is the only thing they can think about,” said one defense lawyer in Los Angeles whose firm represents multiple parents who have not been charged, some of whom have been in contact with the government. He declined to be quoted by name, citing concerns about how that might affect his firm’s clients. He said these clients have watched as the 33 parents already charged have been publicly shamed. They worry that they, too, could be exposed for having ties to Mr. Singer, and that, like the parents already charged, they could have been caught on recorded phone calls talking about their children and their prospects for college.
Morgan Stanley Fires Financial Advisor Linked To College Admissions Scandal - Perhaps we shouldn't be surprised, but the latest financial services firm to get caught up in the sprawling college admissions scandal is Morgan Stanley. The firm has fired one of its financial advisors for 'not cooperating with an internal investigation' into his relationship with disgraced admissions consultant Rick Singer, whom he introduced to a wealthy Chinese family that - according to the Wall Street Journal - paid a staggering $6.5 million bribe in 2017 to get their child into Stanford.As we've reported, some of the Chinese families embroiled in the admissions scandal, which focuses on Singer, his former employees, and dozens of his customers, who employed him to help their kids cheat on admissions tests, bribe coaches and generally bend college admissions staff to his will. WSJ reported yesterday that Morgan Stanley advisor Michael Wu, based in Pasadena-Calif., introduced Singer to the unnamed Chinese family that paid the largest sum exposed in the scandal. As we've pointed out, Chinese families and students actually have a good defense of their participation in the scheme: Given endemic levels of corruption in their home country, most said they simply assumed this was how things worked in the US, and that there was nothing untoward about the scheme. Unfortunately for Wu, revelations that Singer's firm had been on a referral list that the bank had provided to its wealth management clients have been deeply embarrassing for MS.According to the FT, Wu connected the wealthy Chinese family with Singer, with whom he had continued to work after his name was taken off a referral list distributed to the bank's financial advisors.In a sign that this might not be the end of the road for Morgan Stanley, a spokesman said "we are co-operating with the authorities." And MS isn't alone among Wall Street firms: TPG has stripped a former portfolio manager of potentially millions of dollars worth of shares in some of its funds. And former PIMCO CEO Douglas Hodge was among the parents charged in the investigation.
Another school shooting claims two lives at the University of North Carolina at Charlotte - Two students were killed and four injured in a shooting on the final day of classes at the University of North Carolina at Charlotte (UNCC) in Charlotte, North Carolina on Tuesday. A shooter opened the door and walked into a Liberal Studies classroom where students were engaged in presentations and opened fire on the class of some 30 students.Three of the wounded have been treated for life-threatening injuries and one is in stable condition. The surviving victims have been identified as Drew Pescaro, 19; Emily Haupt, 23; Sean Dehart, 20 and Rami Alramatin, 20, a student from Saudi Arabia. The two deceased students are Ellis Parlier, 19 and Riley Howell, 21. Witnesses report that Howell attempted to tackle the shooter in order to defend fellow students before he was killed.No motive for the attack has been released, and according to the press, it does not appear to have been racially or religiously motivated. The shooter is believed to have acted alone.Students at the scene described how the shooting unfolded as an absurdly nightmarish scenario. Students were sitting down to an otherwise normal day of class when the door was flung open and gunshots erupted. Students scrambled over desks and chairs, tripping on their way to the doors as they tried to escape.Charlotte-Mecklenburg Police took one suspect into custody on Tuesday n ight, identified as 22-year-old Trystan A. Terrell, a former History student at UNCC. Terrell enrolled in classes in fall 2018 but dropped out this past semester. He was found to have legally purchased a handgun prior to the shooting and according to witnesses, he was apprehended by authorities when he ran out of ammunition. Terrell told a reporter, “I went into a classroom and shot some guys,” on camera as he was being escorted into a police station after the shooting. He reportedly had no criminal record and was not known to police before his arrest.
How the forces of finance fund MBAs - In 2014, Credit Suisse launched its first higher education note. The product promised its wealth management clients social as well as financial returns. Impact investment, the bank explains on its website, "can help underprivileged and talented students from low-income countries get loans for advanced education". The notes, part of the Swiss bank’s suite of impact investment products, are based on the lending of Prodigy Finance, a rapidly-expanding company which helps international students pay for MBAs at prestigious business schools around the world. Prodigy, which has so far made $750m in loans, is a case study of an emerging relationship between higher education and the global financial industry. It also highlights the ties between universities and corporate recruitment, as well as the push from banks and asset managers to associate themselves with assets that provide a "social benefit". Prodigy's initial seed funding came from a competition at INSEAD, in 2006. In its early stages, the company relied on crowdfunding from the alumni network of the French business school, where Mr Stevens studied as an international student for his own MBA.Last year, by contrast, it obtained $1bn in financing from Deutsche Bank, Goldman Sachs, M&G, Sumitomo Mitsui Banking Corporation and HSBC. It has also, as noted above, established a distribution relationship with Credit Suisse.Prodigy, emphasising the difficulty students can face when trying to borrow in a foreign country, only makes loans to international students (other companies, likeCommonBond, lend domestically in the US). These loans usually pay for an MBA at a major business school, but can also fund graduate degrees in science and engineering. Once living costs are factored in, the cost of such a qualification can often exceed $100,000 a year.Prodigy, in most cases, caps its lending at 80 per cent of the total cost of attendance. An example, from its website in December, points out that at Columbia Business School in the first year, tuition is $74,400, but the total cost is $110,914. Prodigy would therefore lend up to $88,731. The investment case specifically relates to the nature of the degrees. One obvious advantage, for the company and its creditors, is that MBAs typically lead to high-paying jobs. MBA track recruitment — where large employers from the worlds of banking, tech and consulting hire directly from elite business schools — includes an additional benefit for lenders. When students are hired, they tend to receive a sign-on bonus which immediately gives them the option of significantly reducing their loan. If students receive large signing bonuses, they can use them to pay down a significant portion of their debt straight away. The debt was in turn was used to pay the business school fees, meaning both the student and the lender sit in between a flow of cash, from hiring company to university.
Many college grads feel their grip on middle class loosening— A college degree has long been a ticket to the U.S. middle class. It typically confers higher pay, stronger job security, greater home ownership and comparatively stable households. Those benefits have long been seen as worth the sacrifices often required, from deferred income to student debt. Yet college graduates aren't as likely as they once were to feel they belong to the middle class, according to a collaborative analysis of the 2018 General Social Survey by The Associated Press-NORC Center for Public Affairs Research and GSS staff. The survey found that 35% of graduates described themselves as working or lower class, up from just 20% who felt that way in 1983. By contrast, only 64% of college grads say they feel they belong to the middle or upper class.
CFPB fines student loan servicer $3.9 million for unfair practices - The Consumer Financial Protection Bureau fined Conduent Education Services $3.9 million for failing to provide accurate account balances on more than 200,000 student loans that resulted in many borrowers paying off the wrong amounts. The bureau did not publicly state how much Conduent paid back to consumers as part of a three-year remediation plan that began in 2015. The failures happened when the company was known as ACS Education Services and was owned by Xerox, which spun off its business processing services unit in late 2016 with the public company renamed Conduent. From 2005 to 2015, Conduent failed to accurately adjust student loan balances when borrowers asked for a deferment, forbearance or income-based repayment plan. Though the company adjusted borrowers’ monthly billed amounts, it was not able to process all adjustments in a timely manner, resulting in inaccurate balances on hundreds of thousands of student loans, the CFPB said. Conduent “was not able to process all its manual adjustments in a timely manner and the company used a system of electronic 'queues' to hold loans for later processing,” the CFPB said in a 25-page settlement agreement. “Over the years, the queues grew. Respondent tracks its loans not individually but by 'packets,' each of which contain up to nine loans belonging to the same borrower. Eventually, over 200,000 packets of Affected Loans were in the queues for adjustment.” The company neither admitted nor denied liability. “We have entered into a settlement agreement with the CFPB stemming from investigations initiated in 2014 and 2015, prior to Conduent’s separation from Xerox Corporation," Conduent said in a statement. "The investigation centered on loan servicing activities going back into the 2000s." The company self-reported the issues to the CFPB in 2014, but transferred many loans with the wrong balances to other servicers even though it knew some balances were incorrect, the CFPB said. The company also failed in many instances to provide the correct payoff information to thousands of borrowers even after it began the remediation process, the CFPB said.
GOP governor of Oklahoma approves abortion 'reversal' bill - (AP) — Oklahoma’s governor has signed into law a bill allowing doctors who perform abortions to face felony charges for not informing women about the possibility of reversing the process. Republican Gov. Kevin Stitt approved the bill Thursday. It requires medical providers to tell women who are taking medication to end their pregnancies that the process can be reversed after they take the first of two pills. Democrats echoed medical groups across the country in arguing the requirement would force doctors to provide patients with scientifically dubious information. Stitt had previously said he’d sign any anti-abortion bill sent to his desk. Several states with Republican-led legislatures across the country have enacted so-called “abortion reversal” laws, starting with Arkansas in 2015.
U.S. Measles Cases Hit 25-Year High -- The number of measles cases in the U.S. is now the highest it has been in 25 years, according to the most recent data released by the Centers for Disease Prevention and Control (CDC) Monday. There have so far been 704 cases reported in 22 states in 2019, with 13 outbreaks accounting for 94 percent of the cases."We are very concerned about the recent troubling rise in cases of measles, which was declared eliminated from our country in 2000. Vaccine-preventable diseases belong in the history books, not our emergency rooms," Health and Human Services Secretary Alex Azar told NPR.Six of the thirteen outbreaks, representing 88 percent of measles cases, were associated with closely knit communities with lower vaccination rates, CDC said.Thirteen outbreaks of measles have been reported in the U.S. in 2019. Close-knit communities with low vaccination rates are at risk for sustained measles outbreaks. Read about the increase in measles cases in the U.S. https://t.co/9yjDuB4lrB pic.twitter.com/Zp2YP3wdzf— CDC (@CDCgov) April 29, 2019 Cases in two states, Washington and New York, are responsible for the majority of the new cases. The outbreak in Washington is lessening, but the outbreaks in New York are ongoing. They are concentrated in Orthodox Jewish communities in Brooklyn and Rockland County."The outbreaks in New York City and New York State are the largest and longest-lasting since measles elimination in 2000," CDC Director for Immunization Dr. Nancy Messonnier said at a news conference reported by The New York Times. "The longer this continues, the greater the chances that measles will again get a foothold in the United States." Officials in New York City and Rockland County have moved to quell the outbreaks. In New York City, where there have been 423 cases since October 2018, officials closed seven Orthodox schools, but five have reopened after proving that they were now barring unvaccinated students from attending classes. The city has also issued 57 summonses to Williamsburg, Brooklyn residents for refusing to have themselves or their children vaccinated.
'Superbugs' Could Kill 10 Million Annually Without Urgent Action, Warns New Report - A new report on antimicrobial resistance calls for greater action by stakeholders at all levels lest so-called "superbugs" claim 10 million lives a year."There is no time to wait," says the report, released Monday by the U.N. Interagency Coordination Group (IACG) on Antimicrobial Resistance."Unless the world acts urgently, antimicrobial resistance will have disastrous impact within a generation," IACG says.The threat of antimicrobial resistance (AMR) is already deadly, with 700,000 people dying each year as a result of drug-resistant diseases.There is also problem of inequity and lack of affordable access, which the report links to the deaths of "nearly 6 million people annually, including a million children who die of preventable sepsis and pneumonia." Fast forward to 2050, the report adds, and AMR could cause as many as 10 million deaths each year under a worst case scenario. Beyond claiming lives, says IACG, unchecked AMR would also unleash economic damage on the order of "the shocks experienced during the 2008-2009 global financial crisis as a result of dramatically increased healthcare expenditures; impact on food and feed production, trade and livelihoods; and increased poverty and inequality." "Alarming levels of resistance have been reported in countries of all income levels, with the result that common diseases are becoming untreatable, and lifesaving medical procedures riskier to perform," the report says. "Antimicrobial resistance is one of the greatest threats we face as a global community,"
Untreatable Form of Lyme disease Could Hit 2 Million Americans by 2020 - Scientists predict the number of people suffering from a little-understood type of Lyme disease could spike to almost 2 million in 2020. The most common vector-borne illness in the U.S., Lyme disease is caused by the Borrelia burgdorferi bacterium, which is spread by infected ticks. Sufferers can have a fever, headache, chills, fatigue, joint and muscle ache and swollen lymph nodes. In many cases, patients experience an erythema migrans rash that can grow up to 12 inches around the area of the tick bite. Around 329,000 cases are thought to occur each year, although the true number of infections is thought to be higher. In most cases, doctors prescribe antibiotics and the symptoms pass. However, for others the symptoms can linger in what is known as post-treatment Lyme disease (PTLD) or post-treatment Lyme disease syndrome. The condition is characterized by cognitive dysfunction, incapacitating fatigue and chronic pain, according to the authors of a study published in the journal BMC Public Health. The condition is poorly understood; there is no set diagnosis for it, and treatment is controversial, the authors wrote. The cause is unknown—some believe the bug can disrupt the immune system—and it can take months to recover. Past estimates suggest treatments fail in between 10 and 20 percent of cases, which could cost the U.S. economy up to $1 billion per year. “Although antibiotic therapy cures most LD patients, a significant proportion of patients continue to suffer persisting symptoms that can derail normal life,” the researchers wrote. It can therefore be tough to find accurate data on the prevalence of PTLD, and diagnosis can involve ruling out other health problems.
FDA- Big Pharma Drugs Are Making People Kill Themselves While They Sleep - Sleeping drugs such as Ambien have been making people kill themselves in their sleep, says the Food and Drug Administration. Drugs that supposedly help people sleep are linked to falls, burns, poisoning, limb loss, drowning, and even suicide. According to The New York Times, this could all be solved by adding warning labels to the bottles of the pills instead of people trying to get off Big Pharma’s drugs.Incidents related to sleeping pills have included “accidental overdoses, falls, burns, near drowning, exposure to extreme cold temperatures leading to loss of limb, carbon monoxide poisoning, drowning, hypothermia, motor vehicle collisions with the patient driving, and self-injuries such as gunshot wounds and apparent suicide attempts,” according to the FDA’s own research. But rather than tell people not to use such drugs, the FDA simply wants people to know they could kill themselves after taking the pills.The FDA announced Tuesday that a prominent warning would be required on all medication guides for Ambien, Lunesta, Sonata, and the generic version of Ambien, which is called zolpidem. The FDA also mandates a separate warning against prescribing the drugs to anyone with a history of sleepwalking. –Futurism.That’s a lovely side effect…“Patients usually did not remember these events,” the agency wrote, according to Futurism. Bizarre actions have been widely reported after using sleeping pills, and the FDA has warned about this in the past – 12 years ago, in fact. That means this isn’t exactly new information. Big Pharma’s drugs have been problematic for quite some time now, but it is comforting to see others take note of just how disastrous some of these medications can be to humanity.
Why Your Doctor’s White Coat Can Be a Threat to Your Health -- A recent study of patients at 10 academic hospitals in the United States found that just over half care about what their doctors wear, most of them preferring the traditional white coat..What many might not realize, though, is that health care workers’ attire — including that seemingly “clean” white coat that many prefer — can harbor dangerous bacteria and pathogens.A systematic review of studies found that white coats are frequently contaminated with strains of harmful and sometimes drug-resistant bacteria associated with hospital-acquired infections. As many as 16 percent of white coats tested positive for MRSA, and up to 42 percent for the bacterial class Gram-negative rods.Both types of bacteria can cause serious problems, including skin and bloodstream infections, sepsis and pneumonia.It isn’t just white coats that can be problematic. The review also found that stethoscopes, phones and tablets can be contaminated with harmful bacteria. One study of orthopedic surgeons showed a 45 percent match between the species of bacteria found on their ties and in the wounds of patients they had treated. Nurses’ uniforms have also been found to be contaminated.Among possible remedies, antimicrobial textiles can help reduce the presence of certain kinds of bacteria, according to a randomized study. Daily laundering of health care workers’ attire can help somewhat, though studies show that bacteria can contaminate them within hours. Several studies of American physicians found that a majority go more than a week before washing white coats. Seventeen percent go more than a month. Several London-focused studies had similar findings pertaining both to coats and ties.
Massive Herpes Outbreak Reported At Coachella Music Festival - People attending the Coachella Music Festival this year are picking up much more than "good vibes" – they are also picking up herpes. According to the herpes tracking app "HerpAlert" there has been a massive outbreak of the sexually transmitted disease in California which is believed to be associated with the Coachella Music Festival. HerpAlert is an app that allows users to self-report potential cases of the virus in return for access to doctors who can give them a full diagnosis and prescribe medicine. The app received at least 250 requests for medication per day during the Coachella music Festival, according to The Daily Wire. Most of these requests came from the area of the festival and surrounding towns were festival-goers stay during the event. The spokesperson for the app told CBS that it typically receives no more than 12 cases per day from the same area. "In all, 1,105 herpes cases were reported in the Coachella Valley area and in the nearby cities of Los Angeles and San Diego," the New York Post reported. That number is a record for the App, blowing past the 60 inquiries received in L.A. during the Academy Awards back in February. HerpAlert "patients fill out a series of questions about herpes symptoms for HerpAlert and provide a picture of a lesion or scar, which appears on the genitals or around the mouth. A physician then reviews the information, makes the diagnosis and can prescribe medication within hours," the Orange County Register reported. A HerpAlert spoksperson said people "came to the platform for a variety of reasons, including to get medication to treat and prevent flares, in addition to those who came to see if they had a new case of cold sores or herpes." Doctors in the area caution that although the app is showing increased number, in-person visits have not increased in the area. However, the anonymous nature of the app could make it a better tool for getting an accurate number on reports.
A toxic microbe lurks on the SC coast. Older fat men should worry most - Aging fat men who fish or swim on the coast this summer should be aware that a nasty microbe lurks in the water, looking for out-of-shape guys to infect with potentially lethal toxins. The microbe, called vibrio, has grown more prevalent in brackish coastal waters during the past 20 years as the earth’s climate has changed, exposing swimmers and fishermen to its unpleasant effects. Vibrio bacteria can wash into open cuts and rapidly worsen, causing swelling and massive infections. They also can seep into wounds, get into the blood stream and attack the liver, causing people with low-grade liver diseases to become sicker, according to researchers at the University of South Carolina.Those most at risk are people who already are ill or who have developed a minor liver disease that often results from poor eating habits — and no group appears more susceptible to liver problems than overweight men on high-fat diets, USC scientists say. Because of their metabolism and physiology, obese men over 40 years old appear more at risk of developing health problems from vibrio exposure than women and younger people, USC research scientist Geoff Scott said. “That is what the data show, that older males are most susceptible to vibrio wound infections,’’ said Scott, who is leading a national effort by five universities to study how climate change and oceans affect human health. Healthy people who eat well, and do not have any traces of liver disease or other ailments, are less likely to get vibrio infections if they go swimming with open cuts. But everyone should know the risk if they have a wound and plan to swim or fish on the coast, experts say. Vibrio are most abundant in warm brackish tidal rivers that attract people who like to fish, crab and shrimp. Under certain conditions, such as after heavy rainfalls, the bacteria also can exist in the surf where people swim.
Researchers Find Link Between Air Pollution and Crime - Air pollution is a major driver of crime in London says new research by LSE.According to the discussion paper, published by the Institute of Labor Economics (IZA), higher levels of air pollution increases the rate of most types of crime in the capital and, in particular, less severe kinds such as shoplifting and pickpocketing. However, air pollution was not found to have a significant impact on the most serious crimes such as murder, assault causing severe bodily harm or rape.The researchers found that a 10 point rise of the air pollution measure, the Air Quality Index (AQI), increases the crime rate by 0.9 percent. This means that the crime rate in London is 8.4 percent higher on the most polluted day (AQI 103.6) compared to the days with the lowest level of pollution (AQI =9.3). An AQI of over 35, which happens in 1 out of 4 days on average, leads to 2.8 percent more crimes – equivalent to a 9 percent reduction in policing. The research has implications for other major cities such as Chicago and New York which also suffer from high level of pollution and crime.
Dirty air wreaks harm even before birth – Beate Ritz is an epidemiologist at UCLA, and she knows it can be nearly impossible to link one individual's health problem to a specific environmental cause. But when her son was born surprisingly small, the only explanation she could come up with was that exhaust from busy I-10, which passed right above her apartment, must have been to blame. The fear piqued her professional interest, and she began scouring research journals for hints on what the air a woman breathed while pregnant might do to her baby. It was 1990, and Ritz was dismayed to discover there had been almost no studies on the question. Answering it would become her life's work. Some in her field doubted there could be any link between air quality and the well-being of a fetus, let alone the health of the child it would become. It was easy to believe pollution could affect a woman's lungs, the reviewers considering one of Ritz's early grant applications said, but they couldn't credit the notion that it might travel deeper within her body, deep enough to reach the baby she carried. An early hint those judges were wrong came when Ritz learned a colleague in Prague had found the molecular fingerprint of central Europe's ubiquitous coal smoke in the placentas and umbilical cord blood of newborns. If contaminants from Czech coal could reach growing fetuses, she knew, American car exhaust could too. The next question was, what did it do to them? The answers, she believed, could be found in the birth certificates of tens of thousands of Californian babies and in the state's registries of congenital defects and childhood cancers. Ritz broke out each child's vital statistics by address, then matched the addresses against local air pollution levels. The analyses took weeks to run on the computers of the 1990s, but got quicker as the technology gained power. Eventually, she found what she was looking for. Underweight babies were 10 percent more common for women living near heavy traffic. So were premature births; worse still, extremely premature births were 80 percent more likely. Those findings have serious ramifications, because prematurity and low birth weight are both linked to health problems later in life. Ritz found risks of pre-eclampsia, a potentially serious pregnancy complication, increased with pollution levels too. Other researchers have linked miscarriage and infertility to pollution.
Study estimates 15,000 cancer cases could stem from chemicals in California tap water - A new study finds that drinking tap water in California over the course of a lifetime could increase the risk of cancer. Researchers from the environmental advocacy group Environmental Working Group estimated that the contaminants found in public water systems in California could contribute to about 15,500 cancer cases there over the course of a lifetime. These contaminants include chemicals such as arsenic, hexavalent chromium and radioactive elements such as uranium and radium. The study was published Tuesday in the journal Environmental Health. "We need to look at contaminants as a group -- not just one at a time. It's more important to analyze co-occurring contaminants to understand the real world exposure," said lead author Tasha Stoiber, a senior scientist with EWG. She explained that cancer risks are typically determined at the individual element level. EPA head says clean-water access is 'biggest environmental threat' -- despite regulation rollbacks EPA head says clean-water access is 'biggest environmental threat' -- despite regulation rollbacks Stoiber and her colleagues evaluated 2,737 different public water systems across the state of California by assessing the level of reported contaminants in the systems. These water systems are the main providers of drinking water in California, serving 98% of the state's population. They are regulated by the federal Safe Drinking Water Act and overseen by state regulators.Water systems test for a host of both regulated and unregulated contaminants to maintain a safe drinking water supply. The study's authors calculated cancer risk by looking at the reported contaminant levels from 2011 to 2015. assessing the yearly averages of all the reported contaminants and adding them together to determine cumulative risk.
Prawn to be wild: cocaine found in all shrimp tested in rural UK county Researchers have found cocaine in all samples of shrimp tested in a rural area of eastern England, with ketamine also widespread. Scientists from King’s College London, in collaboration with the University of Suffolk, made the “surprise” discovery after taking samples from 15 locations across the mostly rural county of Suffolk. “Whether the presence of cocaine in aquatic animals is an issue for Suffolk, or more widespread an occurrence in the UK and abroad, awaits further research,” said Nic Bury from the University of Suffolk.The study, published in Environment International, looked at the levels of various “micro-pollutants” in freshwater shrimp.“Cocaine was found in all samples tested, and other illicit drugs such as ketamine, pesticides and pharmaceuticals were also widespread in the shrimp that were collected,” said the study.Lead author Thomas Miller from King’s said that “concentrations were low” but that the compounds “might pose a risk to wildlife.”Contamination of the water supply by drug waste is an increasing problem, with residue from insecticides and recreational drugs finding their way into the system.One of Miller’s colleagues, Leon Barron, called the regular occurrence of illicit drugs in wildlife as a result of “surprising”. “We might expect to see these in urban areas such as London, but not in smaller and more rural catchments,” he added.
Pig ‘Ebola’ Virus Sends Shock Waves Through Global Food Chain - What started with a few dozen dead pigs in northeastern China is sending shock waves through the global food chain. Last August, a farm with fewer than 400 hogs on the outskirts of Shenyang was found to harbor African swine fever, the first ever occurrence of the contagious viral disease in the country with half the world’s pigs. Forty-seven head had died, triggering emergency measures including mass culling and a blockade to stop the transportation of livestock. Within days, a government notice proclaimed the outbreak “effectively controlled.” It was too late. By then, the disease had literally gone viral, dispersed across hundreds of miles in sickened animals, contaminated food, and in dirt and dust on truck tires and clothing. Nine months later, the contagion has spread nationwide, crossed borders to Mongolia, Vietnam and Cambodia, and bolstered meat markets globally. While official estimates count 1 million culled hogs, slaughter data suggest100 times more will be removed from China’s 440 million-strong swine herd in 2019, the Chinese zodiac’s “year of the pig.” The U.S. Department of Agriculture forecast in April a decline of 134 million head -- equivalent to the entire annual output of American pigs -- and the worst slump since the department began counting China’s pigs in the mid 1970s. “This is an unprecedented situation,” . “This will impact food prices globally.” The strain of African swine fever spreading in Asia is undeniably nasty, killing virtually every pig it infects by a hemorrhagic illness reminiscent of Ebola in humans. It’s not known to sicken people, however.The harm to pigs is especially critical for China, with a $128 billion pork industry and the world’s third-highest per-capita consumption. China’s hog herd may decline as much as 30 percent, said Juan R. Luciano, chief executive officer of Archer-Daniels-Midland Co., one of the biggest agricultural commodity traders. “China will clearly need to import substantial amounts of pork and likely other meat and poultry to satisfy demand,” Luciano told analysts on an April 26 conference call. Chinese meat purchases may also boost sales of soybean meal, a source of livestock feed, in North America, Brazil, and Europe, he said.
500,000 Bees Killed by Texas Arsonist - Police are looking for an arsonist who burned several beehives in Alvin, Texas, leading to the deaths of more than half a million bees, CNN reported Wednesday. The hives belonged to the Brazoria County Beekeepers Association, which had 24 colonies at the site in total. The hives were discovered burning early Saturday morning by a sheriff's deputy, who extinguished the flames. Some of the bee boxes had also been tossed into a pond on the site.e"It's bad enough to think in today's world this would happen, but dumping them over and then setting fire to them is beyond comprehension," the association wrote in a Facebook post. The club said it had offered a reward for the discovery of the perpetrator and asked anyone with information to contact the sheriff's office. "I broke down in tears when I saw a floating brood frame in the water with bees still caring for the brood," the post's author added. The incident comes at a key time of year for honeybees and beekeepers: Blooming plants have started the bees' honey flow, and the queens were laying thousands of eggs a day, association President Steven Brackman told The New York Times.Sam Degelia, a retired welder who earns extra money selling honey at the farmer's market, lost eight hives with around 60,000 bees each to the blaze."I don't want to say it's like losing a kid, but you put all your hard work and pride in it, and somebody kicks the bucket from under you," Degelia told The New York Times. "First there is the shock of losing the bees, and then you say, 'Well, there goes my honey flow.'"In total, hives belonging to four owners were destroyed.The fire also comes at a critical moment for honey bees overall. In 2017, U.S. beekeepers lost around 40 percent of their honey bees, 2.7 percent more than the average annual loss since 2010-2011, the Bee Informed Partnership found. Brackman told CNN that bees are declining due to the widespread use ofpesticides, with potentially disastrous consequences for humans and the environment."Tomatoes, squash, watermelons, bees pollinate those," Brackman said. "So if bees don't pollinate those, you get zero vegetables, we would see next to nothing in the vegetable stores."
EPA Says Glyphosate Does Not Cause Cancer. Other Public Health Groups Disagree - The U.S. Environmental Protection Agency (EPA) announced Tuesday that glyphosate, the active ingredient in Monsanto's Roundup weedkiller, does not cause cancer, reaffirming its 2017 finding and contradicting juries who ruled the opposite in two high profile trials, Reuters reported.In August 2018, a California jury awarded $289 million to a Bay Area groundskeeper who said that repeated Roundup use caused his non-Hodgkin lymphoma, though that amount was later reduced to $78 million. A U.S. jury awarded a second California man more than $80 million in March over a similar claim. But the EPA has not changed its position. "EPA has found no risks to public health from the current registered uses of glyphosate," EPA AdministratorAndrew Wheeler said in a statement. Environmental groups have cast doubt on the agency's findings, saying they dismiss the conclusions of other public health experts. Just a few weeks ago, the U.S. Department of Health and Human Service's Agency for Toxic Substances and Disease Registry released a toxicology report for glyphosate that acknowledged its health risks, the Natural Resources Defense Council (NRDC) pointed out."The EPA's pesticide office is out on a limb here — with Monsanto and Bayer and virtually nobody else," NRDC senior scientist Jennifer Sass said.The Environmental Working Group (EWG) agreed, pointing to the 2015 conclusion of the World Health Organization's International Agency for Research on Cancer, which ruled it was "probably carcinogenic to humans." EWG also cited a January report published in Environmental Sciences Europe that found the EPA had disregarded independent, peer-reviewed research that showed a link between glyphosate and cancer in favor of Monsanto-funded studies saying it was safe."Today's decision by Administrator Wheeler, like virtually every one he and the Trump administration make, completely ignores science in favor of polluters like Bayer," EWG President Ken Cook said. "This move by EPA should not come as a surprise. Under the control of Trump and Wheeler, the agency is virtually incapable of taking steps to protect people from dangerous chemicals like glyphosate."
Green Groups Say Trump EPA Backing Monsanto's Claim Glyphosate Not a Health Threat 'Completely Ignores Science' - Environmentalists swiftly slammed the Trump administration Tuesday for reaffirming the federal government's position that the world's most widely used herbicide poses no threat to public health—despite other global experts tying it to cancer. After conducting a safety review of the weed killer, the Environmental Protection Agency said in a statement Tuesday that "EPA continues to find that there are no risks to public health when glyphosate is used in accordance with its current label and that glyphosate is not a carcinogen." The agency did, however, identify ecological risks associated with glyphosate—the active ingredient in Monsanto's RoundUp—and proposed some new management measures designed to protect pollinators and reduce the problem of weeds becoming resistant to the herbicide. The EPA's conclusion Tuesday contradicts that of the International Agency for Research on Cancer, a branch of the World Health Organization (WHO) that classifies glyphosate as a probable human carcinogen. Critics of the EPA's announcement Tuesday highlighted that the agency's position conflicts with the WHO's classification. "EPA's pesticide office is out on a limb here—with Monsanto and Bayer and virtually nobody else," Dr. Jennifer Sass, a senior scientist with the Healthy People and Thriving Communities Program at the Natural Resources Defense Council, said in a statement. "Health agencies and credible non-industry experts who've reviewed this question have all found a link between glyphosate and cancer," she said. "EPA should take the advice of its own science advisers—who have rejected the agency's no-cancer-risk classification."
EPA Says Glyphosate Is Safe, But Lawsuits Loom and Bayer’s Woes Mount - Jerri-Lynn Scofield - The Environmental Protection Agency (EPA) on Tuesday doubled down on its previous call that the chemical herbicide glyphosate is safe, making one wonder: is this a 737 Max Redux moment? The agency announced in an April 30 press release: EPA continues to find that there are no risks to public health when glyphosate is used in accordance with its current label and that glyphosate is not a carcinogen. The agency’s scientific findings on human health risk are consistent with the conclusions of science reviews by many other countries and other federal agencies. While the agency did not identify public health risks in the 2017 human health risk assessment, the 2017 ecological assessment did identify ecological risks. To address these risks, EPA is proposing management measures to help farmers target pesticide sprays on the intended pest, protect pollinators, and reduce the problem of weeds becoming resistant to glyphosate. This announcement reaffirms the agency’s previous position, according to the this May 1 NYT account. Bayer acquired Monsanto for $63 billion in 2018, and assumed liability for pending litigation against Monsanto, which originally developed and marketed, Roundup, the world largest selling herbicide, based on glyphosate. Bayer reported last week that 13,400 US Roundup lawsuits are now pending. I wrote about Bayer and Roundup in this March post (see Second Roundup Decision: Jury Finds Weedkiller a “Substantial Cause” of Plantiff’s Cancer).That post discussed the second jury verdict against the company and rather than recap the arguments I made there, I’ll pick up where I left off and only discuss subsequent events. Bayer returns to court this month for a third action, this time involving a husband and wife who claim long-term exposure to Roundup caused their cancer. Four more lawsuits are expected to come to trial in 2019, according to an April 26 WSJ report. The EPA’s decision provides a boon to Bayer, as Fortune reports, as “now Bayer’s lawyers get to point to the EPA’s opinion as backing up their central argument that glyphosate is not carcinogenic.” But environmental groups and other regulators disagree with the EPA’s findings, as Ecowatch reports: The EPA decision isby no means a get out of jail free card. As Fox points out, Bayer could still opt to settle the pending cases: Damien Conover, an analyst who covers Bayer for Morningstar, estimates that it could wind up paying €2 billion ($2.2 billion) in costs related to glyphosate litigation. In a worst-case scenario, Conover predicts costs could rise above €13 billion ($14.6 billion).
Do additives help the soil? - Miranda Hart, who teaches biology at UBC's Okanagan campus, says despite a decades-long practice, there could be environmental consequences of adding bio-fertilizers into soil. It's common practice for farmers to use bio-fertilizers as a method to improve crop production. These added microorganisms will live in the soil, creating a natural and healthy growing environment. However, after a multi-year study on four different crop fields, Hart says the inoculants may not be doing much for the soil. The study, which involved researchers from Agriculture and Agri-Food Canada, was published recently in Science of The Total Environment. "There are so many companies producing microbes and they are lobbying farmers to be part of a green revolution," says Hart. "These products are considered more environmentally friendly than fertilizers and pesticides, but there is no evidence they are working or that they are even able to establish, or grow, in the soil." Arbuscular mycorrhizal (AM) fungi live in and around plant roots, helping the plants take up nutrients. Hart explains that many farmers will use commercially produced AM fungi to improve soil quality and increase yields. However, after the study, she says there is still little evidence that the inoculants work. "It's very hard to determine if the microbes established in the soil," she says. "What we showed is that they often didn't establish. And even when they did, there was no difference in crop performance." The results showed extreme variation, she says. There were areas where the inoculant failed to establish in some fields, while it grew prolifically in others. In one site, it became invasive and took over the resident fungal community in less than a year. "Bio-fertilizers have been sold for decades and it's an industry worth millions of dollars," says Hart. "An important take away from this study is that there seemed to be no effect on the crops. If the farmer invested thousands on the inoculate, it may have been a waste of money."
The dirt on soil loss from the Midwest floods -- As devastating images of the 2019 Midwest floods fade from view, an insidious and longer-term problem is emerging across its vast plains: The loss of topsoil that much of the nation’s food supply relies on.Today, Midwest farmers are facing millions of bushels of damaged crops such as soybean and corn. This spring’s heavy rains have already caused record flooding, which could continue into May and June, and some government officials have said it could take farmers years to recover.Long after the rains stop, floodwaters continue to impact soil’s physical, chemical and biological properties that all plants rely on for proper growth. Just as very wet soils would prevent a homeowner from tending his or her garden, large amounts of rainfall prevent farmers from entering a wet field with machinery. Flooding can also drain nutrients out of the soil that are necessary for plant growth as well as reduce oxygen needed for plant roots to breathe, and gather water and nutrients.As scientists who have a combined 80 years of experience studying soil processes, we see clearly that many long-term problems farmers face from floodwaters are steeped in the soil. This leads us to conclude that farmers may need to take far more active measures to manage soil health in the future as weather changes occur more drastically due to climate change and other factors. Here are some of the perils with flooded farmland that can affect the nation’s food supply.
Waters Begin to Recede After Levee Breach Floods Downtown Davenport, Iowa - Water still remained on the streets of a portion of downtown Davenport, Iowa, Wednesday, a day after a temporary levee meant to hold back the rising Mississippi River failed and inundated the city with more than 6 feet of water. Local emergency officials told the Weather Channel Wednesday morning the waters had receded but some streets remained inundated. The flooding that began around 3:30 p.m. CDT covered about four blocks of downtown Davenport, with water up to 6 feet high in some places, The breach forced some residents to seek shelter on their rooftops, while others were evacuated by boats, the Associated Press reported. The flooded area occurred mostly in a business district, but there were some apartments in the affected area. Several businesses were forced to close as the flood waters rose, and city workers scrambled to reinforce the levee with sandbags. Resident Chase Neukam says he was helping others stack sandbags at the Paradigm Virtual Reality Gaming and Training when the floodwaters began to rapidly rise. "I was standing out front and saw it come in. It was like ‘The Day After Tomorrow,'" Neukam told The Gazette. “It was like a disaster movie, heading down the street really fast. And then it started getting worse.” The NWS issued a flash flood emergency for the area due to the breach, and several area roads were closed including Iowa Highway 22 from Davenport to Muscatine and U.S. Highway 67 north of LeClaire.The weather service said the water had not receded Tuesday night, but was no longer rapidly rising. Residents were urged to avoid the area.The NWS forecasts the Mississippi River to peak in the Quad Cities area, including Davenport, over the next couple of days. Water levels are expected to rise to within a foot off the all-time record high for the Quad Cities, which was 22.63 feet during the catastrophic Midwest floods of 1993.
Mississippi River Breaks 1993 Flood Record - As severe rain and thunderstorms continue to hammer the Midwest, flooding along the Mississippi River has broken quarter-century record. Water levels at Rock Island, Illinois, reached a new record peak, and other spots along the river could also reach new record highs if the rain doesn't stop. The water level at Rock Island rose 7.7 feet (2.3 meters) above flood stage as of 8 am local time on Friday, according to the National Weather Service. Rock Island is about 175 miles west of Chicago, and the previous record was set in June 1993, when the upper Mississippi and Missouri Rivers flooded the surrounding area, according to Bloomberg. Though the area has experienced substantial precipitation in the past few months, in 1993 "we had rain after rain after rain throughout the spring and summer," said Justin Palmer, a hydrologist with the U.S. North Central River Forecast Center in Chanhassen, Minn. "It is kind of a one-off right now," Palmer said. "But the potential is there as we get more rain for the river to stay high. We are definitely vulnerable to a rain event." But according to forecasts, the flooding could get worse. About 1.5 to 2 inches of rain is forecast to fall across Iowa and Illinois through May 10, the US Weather Prediction Center said. Between January and March, much of the Midwest will have had one of the 10 worst rain and snow seasons. Between Jan. 1 and Thursday, 15.1 inches of rain fell in Davenport, Iowa, across the river from Rock Island. High waters levels, which have persisted for months, have slowed the shipments of agriculture commodities like corn and grain, even forcing the CME Group to declare force majeure as some shipping stations became impossible to reach.
FEMA Chief Calls for Changing Attitudes on Storms - Americans must assume more responsibility for protecting themselves from the rising toll of natural disasters, the head of the Federal Emergency Management Agency warned.“Most people think, ‘I see it on TV, it’ll never happen to me -- I’m not going to make the time or investment,”’ Pete Gaynor, the acting FEMA administrator, said in an interview at his office at FEMA’s Washington headquarters. “We haven’t solved the problem in a significant way.”With just five weeks to go until the start of hurricane season, FEMA has made changes to better handle increasingly severe storms, Gaynor said. That includes keeping more supplies in places such as Puerto Rico, Hawaii and Alaska, which can be harder to reach in emergencies. Congress has also given the agency the ability to spend more money preparing communities for disasters, which is cheaper than rebuilding afterward.“We’re a much more ready agency, a battle-hardened agency, based on those two most recent disaster years,” Gaynor said. But he said those changes won’t be enough to deal with the effects of increasingly powerful storms. “We are just a bridge to safe, secure and sanitary,” Gaynor said. “We cannot be everything to everyone. This is a partnership.”
EPA Releases Report Advising Communities to Prepare for Climate Change-Related Disasters - Policymakers at the U.S. Environmental Protection Agency (EPA) published a report in the Federal Register outlining how local communities should start planning for near-future catastrophes associated with climate change.As first reported by the Washington Post, the 150-page report – titled "Planning for Natural Disaster Debris" – offers updates to the 2008 report by advising local government bodies to go "beyond resilience to anticipate, plan, and prepare for impacts" of climate change. In particularly, it addresses how local communities can cope with debris and disaster following floods, hurricanes, wildfires only intensified by a changing climate."Climate change is expected to increase the frequency and intensity of some natural disasters," reads the report citing a 2014 National Climate Assessment. "The amount of debris generated by natural disasters, and the costs to manage it, will likely increase as a result."Citing "climate change" or "a changing climate" a total of 29 times, the report veers somewhat from recent comments made by the agency's own administrator Andrew Wheeler, who told CBS in an interview that "most threats from climate change are at 50 to 75 years out," though the threats represent "an important change we have to be addressing and we are addressing." Just last fall, the Trump administration released a federally mandated major climate report produced every four years by more than 300 independent and government scientists. Writing in the Fourth National Climate Assessment, report author Brenda Ekwurzel said at the time that the findings "made it clear that climate change is not some problem in the distant future. It's happening right now in every part of the country. When people say the wildfires, hurricanes and heat waves they're experiencing are unlike anything they've ever seen before, there's a reason for that, and it's called climate change."
How we analyzed California’s wildfire evacuation routes - AP - To evaluate exit routes for Californians living in areas at risk of a fire-related evacuation, we combined and analyzed data from the U.S. Census Bureau, Cal Fire and OpenStreetMap. We took 2010 census block-level populations, combined with Cal Fire’s “Fire Hazard Severity Zone” maps, and aggregated those to ZIP codes, then applied more current population estimates. Next, we spatially joined those areas with the fire risk map. That provided a current population risk breakdown for each ZIP code, based on area and estimated population. We added OpenStreetMap data to each ZIP code, so we could see which roads cross into or out of the area. Combining the ZIP code population and fire risk data with the standard number of lanes for every major roadway allowed us to come up with a set of ZIP codes that have the greatest number of people living in the highest-risk areas and hypothetically trying to use the fewest number of lanes to leave in any direction or to areas at less risk for fire. What does this tell us?In short, the analysis gives an estimate of how many people there are for every lane of major road leaving an area. When we looked at all ZIP codes in California that have people living in a very high fire risk zone, we found, on average, 134 residents living in the riskiest areas for each lane of traffic going either direction . Only one out of 20 ZIP codes has more than 313 people living in the riskiest areas for each lane of traffic. Paradise had more than 1,000, putting it in the worst 1%. But some areas, such as Oak Park in Ventura County, South Lake Tahoe in El Dorado County or the Palos Verdes Peninsula in Los Angeles County, have two, three or even five times the number of people living in the highest-risk zones, per lane of major roadway out, compared to Paradise. Here are the ZIP codes the analysis identified as being roughly within the worst 1% in the state when it comes to population-to-evacuation-route ratios:
Biodegradable Bags Buried for 3 Years Still Work - The advantage of biodegradable shopping bags is supposed to be that they will not linger as long in the natural environment as conventional plastic bags. However, a new study from the University of Plymouth suggests that might not be the case.The study, published in Environmental Science and Technology Sunday, found that bags billed as biodegradable could still carry around five pounds of groceries after being buried in soil or submerged in sea water for three years, The Weather Channel reported. "After three years, I was really amazed that any of the bags could still hold a load of shopping. For biodegradable bags to be able to do that was the most surprising," study leader Imogen Napper said.
Plastic Watch: Debunking the Technofix Fairy, Biodegradable Bags Don’t Degrade -- Jerri-Lynn Scofield - ‘Biodegradable ‘ plastic bags were still intact and capable of carrying shopping three years after being exposed to the natural environment, according to a study published this week by scientists at the UK’s International Marine Litter Research Unit, School of Biological and Marine Sciences, University of Plymouth. I usually rely on words more than pictures in my NC writings. Here, a picture really is worth a thousand words.The bag looks disgusting, but it is more or less intact. It means there’s no technofix alternative if we wish to reduce or eliminate plastic waste in the marine environment to stopping most use of plastic now. Period.Just as the recycling fairy won’t rescue us – a notion I have previously debunked at length here. Many were shocked to find the recycling they carefully sorted was not in fact, being recycled close to home – if it was being recycled anywhere. Instead, it was shipped to China and other destinations – where it was, shall we say, imperfectly processed. China then forgo being the destination of choice for such waste and in 2017, stopped accepting most plastics imports for recycling.What happened next? The US and other places shifted to shipping their plastic waste to Southeast Asia, as I discussed here. Many US cities and states eliminated or curtailed their recycling programs .And more recently, other countries have followed China’s lead, including last month, India, as I discussed here, and stopped accepting these plastic waste imports. Thus exacerbating the global recycling crisis further. Well, guess what folks: neither is the technofix fairy riding to the rescue anytime soon. This latest paper “examined biodegradable, oxo-biodegradable, compostable, and high-density polyethylene (i.e., a conventional plastic carrier bag) materials over a 3 year period.” To be sure, the study did reveal some differences in the relative rates of disintegration, depending on whether different bags were buried, dumped in the sea, or simply exposed to air. But the money quote (from the abstract): Collectively, our results showed that none of the bags could be relied upon to show any substantial deterioration over a 3 year period in all of the environments. It is therefore not clear that the oxo-biodegradable or biodegradable formulations provide sufficiently advanced rates of deterioration to be advantageous in the context of reducing marine litter, compared to conventional bags.
Scrap Collector: Investigation reveals pervasive plastic scrap smuggling into Malaysia - In the wake of the China ban, Malaysia became the world's largest importer of plastic scrap — and the environmental, social and public health strainengendered by a flood of waste provoked sharp condemnation from Malaysian environment minister Yeo Bee Yin. "At the height of my anger, I wanted to send it back to the country of origin," she told National Geographic last year. "What I realized is there is no tracking. There is a gap between what the citizens know about their waste and what actually happens to their waste." The country quickly imposed a National Sword-esque ban on further foreign imports — but, as reported by The Malaysian Reserve, those restrictions haven't been enough to stop plastic scrap traders. While plastic scrap shipments to Malaysia must bear the identifier 3915 under the Harmonized System (HS) Code, a recent government investigation reveals that exporters have instead been falsely declaring containers under HS code 3920 — a label reserved for plastic products (plates, sheets, film, foil and strip) exempt from import regulations.The results of this investigation, according to Resource Recycling, may help explain some strange post-ban export trends. Decreased 3915-coded shipments from the U.S. to Malaysia have been accompanied by record volumes of shipments coded 3920: in December 2018, approximately one month after Malaysia announced its restrictions, 3920-labeled exports rose from an average of 1.2 million pounds per month in the previous year to 7.5 million pounds, followed by 5.6 million pounds in January and 4.4 million pounds in February.
How vanishing lizards in Madagascar led to a troubling discovery about deforestation and climate change - Barry Sinervo and two dozen coauthors in 2010 published a scientific paper that dismayed wildlife experts. Sinervo had developed a model for predicting local extinctions of lizard populations, based on how much global warming increased a location’s temperature. The collaborators tested the model’s validity against records collected at 200 sites in Mexico, where they had studied this reptile group for decades. Between 1975 and 2008, these temperature-sensitive animals had disappeared from 12 percent of locations where they’d previously been spotted. The researchers then applied the model globally to anticipate future extinctions of such reptiles. They forecast that by 2080, 40 percent of lizard populations around the world would go extinct. But an anomaly caught Sinervo’s attention. Other researchers had reported that one-fifth of lizard populations had already vanished from the jungles of Madagascar, the California-size island off Africa’s southeast coast, far more than observed in the mainland forests just a few hundred miles away. The two adjacent regions should have been roughly the same. He speculated that something about Madagascar’s sky-high deforestation – it has lost half of the forest cover it had in 1950 – made the remaining forest less suitable for lizards. He wondered if the welter of clearings on the island was turning the remaining jungle anomalously hot. In March, he and four colleagues in the U.S. and Brazil published a paper in the journal PLOS One proving his suspicion correct, and substantiating the conclusions of a handful of other recent papers that, in malicious combination with climate change, deforestation is roasting the planet. ‘They’re like canaries in the coal mine … except they’re lizards.’“Climate change is really bad and deforestation at a local scale makes it even worse,” he said. “The lizards told me that.” What happens within and immediately around a deforested area is obvious to anyone who has ever stumbled across a clearing in the woods. One new study shows that globally, forest cover makes land on average of 4°C (7.2°F) cooler. The effect is even stronger in dense tropical forests.
Cyclone Kenneth: Entire villages wiped out, says UN -A powerful cyclone has "entirely wiped out" villages in Mozambique, according to a UN official. Gemma Connell, the head of the regional Office for the Co-ordination of Humanitarian Affairs (Ocha), said it looked from the air like areas had been "run over by a bulldozer". Cyclone Kenneth struck on Thursday with winds of 220km/h (140mph). It came barely a month after Cyclone Idai killed more than 900 people across three countries. In a video posted on Twitter after flying over the affected area, Ms Connell pledged to work with local authorities "to get people the supplies they need". "The weather is still bad, it is still raining," she said. "But thankfully the winds have died down." The BBC's Pumza Fihlani reports that damage to power lines in parts of northern Mozambique is making communication difficult. Almost 20,000 people have taken shelter in makeshift displacement centres, including schools and churches, our correspondent adds. A UN spokesman said a total of five people have now died, quoting Mozambique's government, according to reports. One person was earlier reported to have been killed when Cyclone Kenneth struck after being crushed by a falling tree. The storm also killed three people on the island nation of Comoros.
Floods destroy homes, trap families in cyclone-hit Mozambique (Reuters) - Rescuers raced to help people caught in rising floodwaters in cyclone-hit northern Mozambique on Sunday as houses collapsed and heavy rains raised fears of worse to come. Cyclone Kenneth first slammed into the province of Cabo Delgado late on Thursday, flattening entire villages with winds of up to 280 kph (174 mph) and storm surges - the second cyclone to hit the country in six weeks. Floods and rains that followed sent brown water coursing through the streets of the province’s main city Pemba on Sunday and submerged roads leading to remote areas to the north and south. The Mozambican government has put the initial death count at five. But rescuers said there were fears for the safety thousands of families cut off after rivers burst their banks outside the city. Flights and helicopters were currently grounded, making access “virtually impossible”, said Nicholas Finney from Save the Children. In Pemba, mud homes in the northern neighborhood of Natite had started to collapse under the pressure of the water, the United Nations humanitarian agency OCHA said. Residents tried to bail water out of their houses with plastic buckets. Others stacked sandbags outside or waded through waist-high floods in the torrential rain. Video footage showed a line of cars forming on the main road out of the coastal city. A section of the route was under water. Rescue workers evacuated at least 130 people to centers elsewhere in Pemba on Sunday, mostly by boat, said Salviano Abreu, spokesman for the U.N.’s humanitarian arm. Mozambique is still recovering from Cyclone Idai that hit further south last month and moved into neighboring Zimbabwe and Malawi, killing more than 1,000 people. It is the first time on record that two such powerful cyclones have hit Mozambique in so short a space of time. Weather forecasters have warned that Kenneth could dump twice as much rain on northern Mozambique.
Rain grounds Mozambique aid flights as cyclone death toll hits 38 (Reuters) - Rains grounded aid flights in northern Mozambique for a second day on Monday, hampering efforts to reach survivors of Cyclone Kenneth as the death toll there jumped to 38. Rescuers managed to use a brief break in the downpours to send one helicopter packed with aid to the island of Ibo, where hundreds of homes were flattened by the second cyclone to hit the country in less than six weeks. But rains started again and conditions were too dangerous for the next flight to take off, the United Nations said. Roads to rural districts further north were swamped and impassable after torrential rains on Sunday. “Unfortunately the weather conditions are changing too fast and threatening the operation,” said Saviano Abreu, a spokesman for the United Nations’ humanitarian arm OCHA. Cyclone Kenneth slammed into the Comoros and then Mozambique’s province of Cabo Delgado on Thursday with storm surges and winds of up to 280 kph - stretching resources in a region still recovering from Cyclone Idai which struck further south in March. The storm knocked out power and communications. Some rural communities were reduced to mounds of jumbled wood, with only the occasional structure and coconut tree left standing. Four people died in the Comoros, the United Nations said. Mozambique’s National Institute of Disaster Management said its death toll stood at 38 on Monday - up from an earlier estimate of five - and just over 168,000 people had been affected. After the first hit, heavy rains pounded Mozambique’s north, an area prone to floods and landslides. Information about the scale of the flooding in more remote districts remains scant. In the port city of Pemba at least, waters had started to recede, OCHA’s Abreu said. Water was still waist-deep in some neighbourhoods. One man ferried residents in a wooden boat. Others just waded through the deluge, some carrying belongings on their heads.
Indonesia floods, landslides kill at least 29 (Reuters) - Landslides and floods triggered by torrential rain have killed at least 29 people in Indonesia, the disaster agency said on Monday, with thousands taking shelter in evacuation centers amid fears of disease. More than a dozen people were missing after the rain hit the province of Bengkulu, on the southwest side of Sumatra, on Friday and Saturday, the agency said. Hundreds of buildings had been damaged, along with roads and bridges, with two districts cut off by landslides, adding that the floodwater had subsided in some places. Displaced villagers needed tents, boats, food and water, while heavy equipment was also needed to build temporary bridges. Authorities have warned of the risk of disease spreading due to the lack of clean water.
Indonesia will Move its Capital from Fast-Sinking Jakarta - Indonesia's president elect announced plans this week to move the country's capital away from Jakarta, reportedly the fastest sinking city in the world.A 2018 report said that Jakarta, located on the island of Java, was one of the global cities most vulnerable tosea level rise caused by climate change. It is sinking at a rate of approximately 10 inches per year due to a combination of the drilling of wells for groundwater and the weight of its buildings. The 40 to 50 centimeters (approximately 16 to 20 inches) of sea level rise expected by 2100 even if warming is limited to 1.5 to 2 degrees Celsius would only make the situation worse."In Java, the population is 57 percent of the total for Indonesia, or more than 140 million people, to the point that the ability to support this, whether in terms of the environment, water or traffic in the future, will no longer be possible so I decided to move outside Java," Indonesian President President Joko Widodo told local media, as The Financial Times reported. Jakarta's sinking isn't a problem for the end of the century. Heri Andreas of the Bandung Institute of Technology found that 95 percent of North Jakarta could be underwater by 2050, BBC News reported. Jakarta also experiences serious flooding once a decade and is so congested that its traffic costs Indonesia $7 billion a year, according to The Jakarta Globe.Planning Minister Bambang Brodjonegoro announced Widodo's decision Monday following a cabinet meeting,Reuters reported. "The president chose to relocate the capital city to outside of Java, an important decision," he said. An alternative capital has not yet been selected, and Widodo asked ministers to come up with alternatives, The Jakarta Globe reported. Brodjonegoro said the new capital would probably be located in the center of the country, to encourage a sense of fairness and equity, and that it would need to have enough drinking water and be relatively safe fromnatural disasters like earthquakes, volcanic eruptions and flooding.
Over a Million Forced to Evacuate as 'Potentially Catastrophic' Cyclone Fani Makes Landfall in India - A storm that meteorologist Eric Holthaus characterized as "one of the strongest" cyclones in India's recorded history made landfall on Friday amid warnings of "potentially catastrophic" wind, rain, and ocean surges. Over a million people were reportedly forced to evacuate Thursday as Cyclone Fani—classified as the equivalent of a Category 4 hurricane—hurtled toward India. Tens of millions of people are in the path of the massive storm."Meteorologists are calling the storm a near-worst-case scenario for coastal zones, as it will push an enormous storm surge inland, inundating homes, roads, and businesses near sea level—not just in eastern India but potentially also north into Bangladesh," the Washington Post reported. "This low-lying stretch of coast along the Bay of Bengal is one of the most vulnerable to storm surge in the world."Bishnupada Sethi, special relief commissioner for the Indian state of Odisha, told Al Jazeera that at least two people have died since the storm made landfall Friday.Oxfam India, which is helping deliver emergency relief in response to Cyclone Fani, said the storm has already "wreaked havoc in the state of Odisha.""Heavy rainfall and high-speed winds have destroyed livelihoods leaving families in urgent need of help," the group wrote. "They are in urgent need of safe drinking water, medical and hygiene supplies, food, and long-term recovery and rehabilitation support to cope with the disaster." Bimal Pandia, an officer with Oxfam, told The Guardian Friday morning that the storm is "quite serious now; the wind is blowing at between 120 and 150km/hour." Many trees have been uprooted outside our house," "but since we are not able to venture outside it’s difficult to tell the damage."
U.S. Southeast Atlantic Coast Facing High Threat of Sea-Level Rise in Next 10 Years - New research shows 75 percent of the Atlantic Coast from North Carolina to Central Florida will be highly vulnerable to erosion and inundation from rising tides by 2030, negatively impacting many coastal species’ nesting habitats.The new data reflect a 30 percent increase in highly vulnerable areas in the region since 2000, the date of previous projections from the U.S. Geological Survey’s Coastal Vulnerability Index.The findings come from a study in the The Journal of Wildlife Management, which was led by Betsy von Holle, a biologist at the University of Central Florida.Some of the coastal species at risk include loggerhead and green sea turtles, threatened species that nest along the shoreline and already face challenges such as an uptick in infectious diseases. According to the study, sea-level rise will increase the risk of erosion in about 50 percent of the nesting areas for those species by the next decade.“We need to know not only what areas are going to be the most affected by sea-level rise, but also those species most vulnerable to sea-level rise in order to figure out management plans for coastal species,” von Holle says. Seabirds don’t fare any better, according to the study. High-density seabird nesting habitat along the coast for the gull-billed tern and the sandwich tern is expected to have approximately 80 and 70 percent increased risk of erosion and inundation from sea level rise by 2030, respectively.
Permafrost collapse is accelerating carbon release - This much is clear: the Arctic is warming fast, and frozen soils are starting to thaw, often for the first time in thousands of years. As the temperature of the ground rises above freezing, microorganisms break down organic matter in the soil. Greenhouse gases — including carbon dioxide, methane and nitrous oxide — are released into the atmosphere, accelerating global warming. Soils in the permafrost region hold twice as much carbon as the atmosphere does — almost 1,600 billion tonnes1. What fraction of that will decompose? Will it be released suddenly, or seep out slowly? We need to find out. Current models of greenhouse-gas release and climate assume that permafrost thaws gradually from the surface downwards. Deeper layers of organic matter are exposed over decades or even centuries, and some models are beginning to track these slow changes. But models are ignoring an even more troubling problem. Frozen soil doesn’t just lock up carbon — it physically holds the landscape together. Across the Arctic and Boreal regions, permafrost is collapsing suddenly as pockets of ice within it melt. Instead of a few centimetres of soil thawing each year, several metres of soil can become destabilized within days or weeks. The land can sink and be inundated by swelling lakes and wetlands. Abrupt thawing of permafrost is dramatic to watch. Returning to field sites in Alaska, for example, we often find that lands that were forested a year ago are now covered with lakes2. Rivers that once ran clear are thick with sediment. Hillsides can liquefy, sometimes taking sensitive scientific equipment with them. This type of thawing is a serious problem for communities living around the Arctic (see ‘Arctic permafrost’). Roads buckle, houses become unstable. Access to traditional foods is changing, because it is becoming dangerous to travel across the land to hunt. Families cannot reach lines of game traps that have supported them for generations.
There's so much CO2 in the atmosphere that planting trees can no longer save us - Humans emit roughly 30 to 40 billion tons of the greenhouse gas, carbon dioxide, into the atmosphere each year. If we keep it up, Earth will continue to heat up and ultimately devastate our way of life.So what can we do about it?Most scientists agree that we need a way to capture some of that CO2 out of the atmosphere. One idea is to plant lots of trees. Trees use CO2 in order to grow. They also release oxygen, so it's a win-win. But studies indicate that we simply can't grow enough trees to capture the necessary amount of CO2 that would help us meet the goals set by the Paris Agreement. In truth, we would have to cover the entire contiguous US with trees just to capture 10% of the CO2 we emit annually. There's just not enough room on this planet to have the farmland it takes to feed the world plus the space to plant the necessary number of trees. In other words, many of us would starve if we tried using trees to solve our emissions problem.
Phase out greenhouse gas emissions by 2050 to end UK contribution to global warming - The UK can end its contribution to global warming within 30 years by setting an ambitious new target to reduce its greenhouse gas emissions to zero by 2050, the Committee on Climate Change (CCC) says today.Ten years after the Climate Change Act became law, now is the right moment to set a more ambitious goal. Achieving a ‘net-zero’ target by the middle of the century is in line with the UK’s commitment under the Paris Agreement; the pact which the UK and the rest of the world signed in 2015 to curb dramatically the polluting gases that cause climate change.Scotland has greater potential to remove pollution from its economy than the UK overall, and can credibly adopt a more ambitious target of reaching net-zero greenhouse gas emissions (GHGs) by 2045.Wales has slightly lower opportunities than the UK as a whole, and should adopt a target for a 95% reduction in greenhouse gas emissions by 2050, compared to 1990 levels.This is a crucial time in the global effort to tackle climate change. Global average temperature has already risen by 1°C from pre-industrial levels, driving changes in our climate that are apparent increasingly. In the last ten years, pledges to reduce emissions by the countries of the world have reduced the forecast of global warming from above 4°C by the end of the century to around 3°C. Net-zero in the UK would lead the global effort to further limit the rise to 1.5°C.The Intergovernmental Panel on Climate Change (IPCC) has emphasised the vital importance of limiting further warming to as low a level as possible and the need for deep and rapid emissions reductions in order to do so. The CCC’s recommended targets, which cover all sectors of the UK, Scottish and Welsh economies, are achievable with known technologies, alongside improvements in people’s lives, and should be put into law as soon as possible, the Committee says.
Nicola Sturgeon declares ‘climate emergency’ at SNP conference - Scottish First Minister Nicola Sturgeon has declared a "climate emergency" in her speech to the SNP conference.The SNP leader told delegates in Edinburgh she was inspired after meeting young climate campaigners who had gone on strike from school.Ms Sturgeon said "they are right", and pledged to "live up to our responsibility" to halt climate change.She also announced what she described as the SNP's "biggest campaign on the economics of independence".Labour is expected to press the UK government to declare a national climate emergency on Wednesday.The party will call for a dramatic cut in the UK's carbon emissions, with leader Jeremy Corbyn also calling for a UK-wide ban on fracking.Fracking has already been halted in Scotland by Ms Sturgeon's devolved government. It comes after weeks of strikes by school pupils and protests by Extinction Rebellion protestors, which have targeted both the UK and Scottish parliaments.Ms Sturgeon told the conference that Scotland is a "world leader" on climate change, and is already committed to being carbon neutral by 2050. She pledged that the country would continue to "lead by example" as our obligations to the next generation are "the most important we carry".
Rebellious Times -- It can sometimes seem a lonely road to walk. Voices in the wilderness: a plucky band of writers doing their best to explain the science of climate change, anxiously watching as the countdown-clock ticks away. Producing carefully-written, fully-referenced content, only to watch people turn over and go back to sleep. Facing condemnation, derision, ridicule, from those to whom any notion of deviation from Business as Usual is anathema. Yes, the lot of the climate change campaigner has indeed felt like a lonely road at times. But not any more. Something extraordinary has happened. People have woken up. Switch to the UK in April 2019 and it's not swords and shields but locks, glue, dance and song. The extraordinary protests by the new group, Extinction Rebellion, have brought not only climate breakdown into the limelight, but also biodiversity-loss, pollution and themyth that you can have infinite growth on a finite planet. Over the same period, vast numbers of schoolchildren have undertaken strikes and organised their own demonstrations. Swedish student Greta Thunberg has admonished administration after administration on her tour of European capital cities. Bank of England Governor, Mark Carney, starkly warned companies that if they don’t adjust to the reality of global warming, they will simply cease to exist. To top all of that off, David Attenborough delivered his bluntest warnings to date in a lengthy and compelling documentary - “Climate change: the facts”. In the light of all these developments, it almost feels as if I can put my feet up! Of course, neither I nor we will put our feet up: if you don't hear from some Team-SkS members for a while, you can guarantee they are still busy on things climate-related, in various other ways. We know there will always be political opposition to climate science; the usual suspects will not stop peddling their contrarian talking-points and they will not go unopposed.
The Teenager Schooling World Leaders on Climate Change -- For hundreds of thousands of young people, Greta Thunberg is an icon. At only 16, she’s proving you don’t have to be an adult to make a world of a difference. Today, the Nobel Peace Prize nominee is among the most influential voices speaking out about Earth’s dire climate crisis.The teen first learned about the devastating, lasting impact of climate change when she was just 11 years old. Dismayed by adults’ unwillingness to respond, she decided to take action herself. She began by making small changes in her own life—cutting meat and dairy from her diet and convincing her parents to also live moresustainably.Frustrated by the lack of attention from policymakers, Greta held a strike in August 2018, missing class to sit in protest in front of the Swedish Parliament with a sign that read “Skolstrejk för Klimatet” (“School Strike for the Climate”). She vowed to hold strikes every Friday until Sweden was in alignment with the Paris Agreement.People in Sweden (and now, the world over) began to take notice of Greta’s stance. After a viral TED Talk where she explained her call to action, others began to join in her protests. Today, #FridaysforFuture has grown to be a global phenomenon, with hundreds of thousands of young people from over 125 countries standing alongside Greta.In addition to her Nobel Peace Prize nomination, Greta’s actions have earned her speaking engagements at the World Economic Forum and COP24—but most importantly, they’ve ignited a new generation to create change and stand up for the future.Greta says she owes her dogged determination in part to being on the spectrum: “I think if I wouldn’t have had Asperger’s I don’t think I would have started the school strike, I don’t think I would’ve cared about the climate at all… That allowed me to focus on one thing for a very long time.” Her #FridaysforFuture protest on March 15, 2019 drew 1.6 million strikers, from 2,000 locations, across all seven continents. She wants world leaders to know that change is coming, whether they like it or not.
The Greta effect? Meet the schoolgirl climate warriors - This Friday, like many Fridays before it, Haven Coleman will not be attending school. The 13-year-old is taking a stand.Coleman, from Denver, Colorado, is risking her education to strike for climate change action. She told the BBC her decision was down to one person: Greta Thunberg. "Once we found Greta, we were like, 'Oh that's amazing, let me try, let me do something similar'," Coleman said. When Thunberg sat outside Sweden's parliament on 20 August, 2018, aged 15, she cut a lonely figure. Carrying a "school strike for climate change" sign, she said she was refusing to attend classes until Swedish politicians took action. Nine months on, Thunberg is no longer alone. Energised by her climate strike movement, Fridays for Future (FFF), students are vowing to boycott school on Fridays until their countries adhere to the 2015 Paris agreement, which aims to prevent global temperatures from rising 1.5C (34.7F) above pre-industrial levels. On 15 March, an estimated 1.6 million students from 125 countries walked out of school to demand climate change action. The next co-ordinated international protest takes place on Friday, before another global strike on 24 May. Coleman, the co-director of US Youth Climate Strike, is one of them. She founded the organisation with Isra Hirsi, the 16-year-old daughter of Democratic congresswoman Ilhan Omar, and Alexandria Villaseñor, 13. "It's really cool because it's driven by girls. I think that's amazing," she said. Learning about the effects of deforestation on sloths - her "favourite animal" - was her gateway into climate activism. But it was Thunberg's school walk-out, she said, that prompted her to start striking on her own. So she began descending the steps of the Denver Capitol Building every Friday with her "school for climate strike" placard. With the help of Hirsi, who's from Minneapolis, and Villaseñor, who's from New York, she led a nationwide strike on 15 March across all 50 states.
UK Parliament declares climate change emergency - BBC - MPs have approved a motion to declare an environment and climate emergency. This proposal, which demonstrates the will of the Commons on the issue but does not legally compel the government to act, was approved without a vote. Labour leader Jeremy Corbyn, who tabled the motion, said it was "a huge step forward". Environment Secretary Michael Gove acknowledged there was a climate "emergency" but did not back Labour's demands to declare one. The declaration of an emergency was one of the key demands put to the government by environmental activist group Extinction Rebellion, in a series of protests over recent weeks. Addressing climate protesters from the top of a fire engine in Parliament Square earlier, Mr Corbyn said: "This can set off a wave of action from parliaments and governments around the globe. "We pledge to work as closely as possible with countries that are serious about ending the climate catastrophe and make clear to US President Donald Trump that he cannot ignore international agreements and action on the climate crisis."
'Activism Works': UK Parliament Makes History in Declaring Climate Emergency - The U.K. Parliament made history on Wednesday by becoming the first to declare an environment and climate emergency.MPs in the House of Commons passed the motion put forth by Labour leader Jeremy Corbyn following debate.“This can set off a wave of action from parliaments and governments around the globe," Corbyn said in a statement, which called attention to the recent wave of actions demanding urgent action on the climate crisis."Protesters and school-strikers told us to act," he said. "Governments never act without pressure and we must keep the pressure up. I'm proud that the Labour Party brought this motion to the House, and now we will carry on this work by developing our plans to deliver a Green Industrial Revolution.""Now it's time for real action to tackle climate change," Labour added on Twitter. Climate activists welcomed the development—and the grassroots power that made it happen—but also stressed that it must be followed by a dismantling of business-as-usual to truly behave as though it's an emergency. "We have no time to waste," Labour leader Jeremy Corbyn said in prepared remarks. "We are living in a climate crisis that will spiral dangerously out of control unless we take rapid and dramatic action now."Corbyn also praised youth who've led recent climate strikes. "The truth is they are ahead of the politicians on this—the most important issue of our times," said Corbyn.
'Call It a Crisis': Report Details Failure of Cable and Network Outlets to Accurately Describe Climate Emergency --Name and shame. That's the dual directive from a new report that calls on news organizations to use appropriate language when discussing the climate crisis — even as the report calls them out for inaction.The report — titled 'Call It a Crisis': The Role of U.S. Network News in Communicating the Urgency of Climate Change — analyzed the coverage of ABC, NBC, CBS, CNN, MSNBC and Fox News to determine just how much urgency the influential outlets bring to their reporting. According to David Arkush, managing director of Public Citizen's Climate Program, the specific words that journalists and news anchors use — or choose not to use — matters."The words we use to characterize an issue make a difference in how it is perceived and prioritized politically," said Arkush.When outlets with massive nightly audiences like the ones the report studied "consistently fail to use language that conveys that climate change is a crisis or emergency," Arkush added, "they unwittingly put a heavy thumb on the scale in favor of complacency and inaction."Fox News was the worst offender, with the use of "climate crisis" coming in for only five mentions during the coverage period — all of which, as Public Citizen noted, were efforts to "minimize the issue with false logic, mockery or misinformation." But other news networks weren't much better than the conservative channel. The only network to use the term in double digits was CNN, and only 16 of the 26 mentions were by a host. Van Jones, whose eponymous show ran every other Sunday during the survey period, accounted for six of those mentions.
Climate change and the journalists who are trying to save you - We’re at a one-day conference at the Columbia School of Journalism on climate coverage, and we’re wired and exhausted and hopeful and sad. But when it comes to this coverage, in her own experience, “anything overly sad didn’t really work,” she says. The question of how to tell the story of climate change—to account for all that’s lost and will be lost—in a way that does not make people want to turn away is at the forefront here at Covering Climate Now, a conference and initiative that The Nation and Columbia Journalism Review announced last month. In a report titled “The media are complacent while the world burns,” CJR’s Kyle Pope and The Nation’s Mark Hertsgaard laid out the recent history of journalism’s failure to tell accurate and compelling stories about climate change, which reached a pivotal point in the 1980s when media outlets “fell victim to fossil-fuel-industry propaganda,” repeating their lies. From there, a confluence of institutional issues—including many journalists’ tendency to cover climate change as a debatable topic rather than scientific fact and an attention economy, driven by social media platforms, that prioritizes quick, cheery stories—have only worsened the problem.“This is beyond any doubt the most compelling story of our time,” Bill McKibben tells the audience here via Skype. “It touches on every single part of human life and thus every beat that journalists cover.”McKibben joined the conference from California during the tour for his book Falter, one of several new releases—including Benjamin Wallace-Wells’ The Uninhabitable Earth and Nathaniel Rich’s Losing Earth—to take on this story this spring. But on a daily basis, most of the climate coverage we see, Washington Post columnist and panelist Margaret Sullivan points out, happens at prestige or legacy publications—much less often at the local level or at broadcast organizations where so many Americans get their news. And that coverage often reflects journalists’ reluctance to identify with activist movements of any kind. Journalists “don’t feel comfortable generally being advocates,” she says. “They feel comfortable being observers and tellers of a story and impartial, sort of neutral observers. I think that that does need to change on a topic as important as this.”
Because 'The House Is on Fire,' Naomi Klein Takes Centrism-Obsessed Media to Task for Failed Climate Coverage - News coverage of the climate crisis can no longer rely on the false pretense of objectivity, writer and activist Naomi Klein said Tuesday. "There is a confirmation bias among the largest chunk of journalists out there who really pride themselves on being centrists," Klein said Tuesday during a town hall at the Columbia Journalism School in New York. "There's an absolute fetish for centrism, for seriousness defined by splitting the difference—and not getting too excited about anything"The mainstream media is "profoundly distrustful of people who are saying 'actually, the house is on fire,'" Klein said, citing the impulse among many journalists to remain objective and hear both sides. "But guess what," said Klein. "The house is on fire."The journalism school's publication, The Columbia Journalism Review (CJR), is joining with The Nation to launch an initiative, #CoveringClimateNow, to change coverage of the climate crisis.In an essay describing the initiative from April 22, Mark Hertsgaard, environmental correspondent for The Nation, and Kyle Pope, the publisher of CJR, described how they see the journalist's job in the climate crisis as one of sounding the alarm."Instead of sleepwalking us toward disaster, the U.S. news media need to remember their Paul Revere responsibilities," wrote Hertsgaard and Pope, "to awaken, inform, and rouse the people to action."Part of that mission, Klein said, is pushing back on conventional wisdom about the role of extractive technologies in furthering neoliberal economic development. "You can't leave it all to the markets," Klein said, laying out a vision of the future that leaves neoliberalism behind."You have to plan," Klein added. "You have to regulate."Further, said Klein, the entire project of neoliberalism "falls apart" if the climate crisis is reality. Watch Klein's comments:
Is The New World Order's Global Annihilation Agenda Ramping Up? - New World Order globalists are seeking to eliminate 90% of the human race, in a bid to protect the environment. Those for mass death have convinced themselves that the only way to save the planet is to eliminate “useless eaters.” The NWO and globalization has been happening for some time now, but there always appears to be a moment when the agenda’s rhetoric is ramped up to disturbing levels, complete with apocalyptic death. Even leftist totalitarian comedians like Bill Maher have joined in the horrific agenda pushing by saying he just wants people to, “Not have kids, DIE, and stay dead.” Maher said humans hurt the environment, so the solution is for them to die. (Did Maher forget he’s a human?) “As he argued that humans hurt the environment, he concluded that it would be better for Earth for more people to ‘not have kids, die and stay dead,’” reports NewsBusters.org. Leftists truly believe the planet will be destroyed if humans are allowed to survive much longer. Left-wing nut case Alexandria Ocasio-Cortez warns that planet Earth only has 12 more years before it will be destroyed by “climate change” — a completely fabricated junk science narrative invented by power-hungry Leftists who are almost universally illiterate in the realm of real science, reported Natural News. There are far too many humans who believe that the slaughtering and killing off of billions of other humans is the answer to “climate change.” Because globalists truly believe humans are a threat to the planet, they have no qualms whatsoever about calling for the mass genocide of human beings around the world. After all, they are trying to “save the planet,” they tell themselves, which translates in their twisted and sociopathic minds, that the ends justify the means. Natural News further wrote that the global annihilation agenda is ramping up, and with it comes increased rhetoric. In fact, laws are now being pushed that will allow governments to efficiently dispose of billions of bodies by “recycling” them back into the food supply. (Soylent Green, anyone?) In the state of Washington, for example, a new “human composting” bill has been passed by the state House and Senate. Once signed into law, it would allow human corpses to be liquefied and flushed into the sewer system. From there, “biosludge” is collected by every city in America — including Seattle — where it is dehydrated and trucked out to the rural farms in surrounding areas. There, it’s dumped on farm fields after being dishonestly labeled “free fertilizer” for farmers. Effectively, what this means is that human corpses are going to be “recycled” back into the food supply in Washington. Soon, this will be authorized across America. It’s one of the necessary steps before the globalists unleash their “kill switch” biological weapon that’s designed to kill off at least 90% of the global population. Once that is accomplished, human labor will be replaced by automated robots, while armed Google “suicide drones” seek out and exterminate the human survivors living in the rubble of cities like Seattle.-Natural News
Facebook Hires Koch-Funded Climate Deniers for 'Fact-Checking' -It may not come as a surprise that leading climate denier Donald Trump has made more than 10,000 false or misleading claims since he became president, according to fact-checkers at the Washington Post. As the Post reports, Trump's "tsunami of untruths just keeps looming larger and larger." Much of this tsunami of untruths will get reposted on Facebook as fact. Those hoping that Facebook will accurately check Trump's statements and clean up the torrent of fake news on its platform will have to think again, especially if you are concerned about climate change.In what can only be described as verging on the bizarre, Facebook CEO Mark Zuckerberg has given the contract to fight fake news to an organization that pushes fake news on climate change. According to reports in Think Progress and Grist, Facebook has announced that it was teaming up with CheckYourFact.com, which is an offshoot of the anti-science media site, The Daily Caller.The CheckYourFact website brags that: "Our mission is a non-partisan one. We're loyal to neither people nor parties — only the truth. And while the fact-checking industry continues to grow, there are still countless assertions that go unchecked. We exist to fill in the gaps."In fact, the opposite seems to be true. As Think Progress outlines:The Daily Caller, which has published misinformation about climate science for years, was co-founded by the science-denying Fox News host Tucker Carlson and is backed by major conservative donors, including Charles and David Koch, the billionaire fossil fuel barons who are the single biggest funders of climate science misinformation. Think Progress includes a link back to 2015, when a peer-reviewed paper from scientists at Germany's Alfred Wegener Institute was published in the journal Nature Geoscience. The Daily Caller tried to twist the research to argue that "global warming is nothing new." One of the world's leading climatologists, professor Michael Mann, whose own work has been distorted by The Daily Caller, told Think Progress: "It is appalling that Facebook has teamed up with a Koch-funded organization that promotes climate change denial. Facebook must disassociate itself from this organization."
Microsoft joins group seeking to kill off historic climate change lawsuits - Microsoft has joined a conservative-led group that demands fossil fuel companies be granted legal immunity from attempts to claw back damages from the climate change they helped cause. The stated goals of the Climate Leadership Council (CLC) include a $40-a-ton fee on carbon dioxide emissions in return for the gutting of current climate change regulations and “protecting companies from federal and state tort liability for historic emissions”. Microsoft has become the first technology company to join the CLC, which includes oil giants BP, ExxonMobil, Shell, Total and ConocoPhillips among its founding members. Handing legal immunity to these oil companies would squash a cavalcade of recent climate lawsuits launched by cities and counties across the US, including one by King county, Washington, where Microsoft is based. “When Microsoft is underwater it should ask itself if this is a good deal,” said Matthew Pawa, a lawyer representing King county, which includes Seattle, in its lawsuit against five major oil companies. Pawa also represents New York City in its suing of the same five firms – BP, Exxon Mobil, Chevron, ConocoPhillips and Shell. “Microsoft and other tech companies have been looking for a whizz-bang technocratic solution to climate change and they think this is it,” he said. “But they don’t know what they are doing. This is a raw deal that would stick taxpayers with the bill for decades of carbon pollution.” Facing rising costs from sea level rise, storms and heatwaves, a growing band of elected officials from across the US have turned to the courts to force fossil fuel producers to pay compensation to ameliorate the escalating damages. Many of these claims point out that firms like Exxon privately knew of the consequences of climate change for at least 40 years, long before it was a public issue, only to deny the problem and block meaningful action to address it.
Green New Deal's centralized government approach won't ensure a cleaner environment – op ed by Steve Scalise, House Republican Whip and Kay Coles James, president of the Heritage Foundation - There’s no way around it: big government proposals require big public scrutiny. Americans are skeptical of government, which is why those promoting far-reaching climate legislation have worked hard to sweeten the Green New Deal (GND). GND proponents sell this huge takeover of the American economy and the American way of life not only as a supposed antidote to climate change, but as the ultimate provider of economic security, regardless of the cost. As national leaders in the public policy arena, we both want economic security and justice for the American people, too. But we realize that socialist policies and paternalistic, big government programs will produce exactly the opposite result. One of us learned this lesson from personal experience — having grown up poor in the projects in Richmond, Va., during segregation — one of six children in a single-parent household. The other learned it as a federal lawmaker and student of history, witnessing socialism’s champions enrich themselves, and live by a different set of standards while failing to deliver on their promises to improve lives.That’s why we’re so troubled when people who purport to want economic security propose policies that would actually do irreparable harm to the very communities they claim they’re trying to help. The GND would be economically catastrophic for American families while also failing in its supposedly primary mission: to significantly reduce the earth’s temperature. Under the Green New Deal, manufacturing and energy production in the United States would be outsourced to countries like China and India. Many nations lack the environmental safeguards long since implemented in the United States, and this outsourcing would result in a drastic increase in global emissions.
Pelosi Invokes Obama's Legacy To Kill The 'Green New Deal' - Nancy Pelosi is employing a new weapon in her desperate battle to keep a lid on the restive progressives and "Democratic Socialists" who now represent a sizable voting bloc in the House: Invoking the legacy of President Barack Obama. According to Bloomberg, as the House prepares to vote on Alexandria Ocasio-Cortez's 'Green New Deal' resolution, Pelosi is using Obama's 'leadership' on climate change - like joining the Paris Climate Accords - to support her reasoning that there might be more moderate ways to deal with climate change short of banning air travel and calling for the reconstruction of nearly every building in New York City. The report precedes two climate-change-related votes in the House this week: One on the GND resolution, and another proposal, which has Pelosi's explicit backing, that would seek to stop President Trump from pulling out of the Paris Accord. Pelosi has made it clear that the latter bill both has a better chance of ultimately becoming a law and producing a tangible accomplishment, while the GND would simply hand Trump and his fellow Republicans a cudgel with which to bludgeon the moderate Democrats in swing districts who were responsible for the Democrats' mid-term victory in the House. However, Alexandria Ocasio-Cortez and other far-left Dems, who have done a much better job of amplifying their voices on social media, successfully drowning out their more moderate peers, have made it clear that while they wouldn't oppose Pelosi's plan - it's still a good first step, they've said - it falls far short of their goal.And to be clear, that goal remains: Prevent the imminent climate-change-driven destruction of planet Earth, which - in case you've forgotten - is only 12 years away. "The idea that we can just reintroduce 2009 policies is not reflective of action that is necessary for now in the world of today," said Ocasio-Cortez. She added that "there is no harm in passing" Pelosi's bill, but ultimately, the GND is what's needed.
House Passes First Major Climate Bill in 10 Years - The U.S. House of Representatives approved its first major climate change legislation in a decade on Thursday, Reuters reported. The Climate Action Now Act would require President Donald Trump to keep the U.S. in the Paris agreement, mandating that he outlines steps to reduce greenhouse emissions and prohibiting him from using federal funds to withdraw from the agreement. The bill passed 231 to 190, with three Republicans crossing the aisle to approve it with the Democrats. It is unlikely to pass the Senate, but the Democrats see it as a way to stake out a climate position ahead of the 2020 election and to signal to the international community that a future Democratic president would stay in the agreement, The Washington Post reported. "Passing this bill is an important signal to our allies, and my expectation is that when we act, we'll see increased ambition from them, too," Democratic Florida Representative Kathy Castor, who sponsored the legislation and chairs the House Select Committee on the Climate Crisis, told the press before the vote, as The Washington Post reported.
Why Your Gas Mileage May Be Declining - Over the weekend, I saw a passing reference on Twitter to the declining energy content of gasoline. Intuitively I know this to be correct for reasons I discuss below. But the poster linked to data from the Energy Information Administration (EIA) that I hadn't previously seen. The EIA doesn't directly tabulate the energy content of gasoline. But they do provide two pieces of data that let us calculate it ourselves from two relevant tables in the April 2019 Monthly Energy Review. Table 3.5 provides Petroleum Products Supplied by Type in thousands of barrels per day, while Table 3.6 provides Heat Content of Petroleum Products Supplied by Type in trillion Btus per year. From the annual numbers, doing the appropriate conversions (which includes accounting for leap years) provides the energy content of gasoline, in BTUs per gallon, since 1949. What we find is that the EIA reported a constant energy content of gasoline from 1949 to 1992 of 125,071 Btu/gallon. I have always typically used 125,000 Btu/gal as the standard value for gasoline. Starting in 1993, the EIA shows the energy content start to decline. The decline accelerates in 2006. What happened then? I have seen two explanations floated. I have heard some suggest that the shale oil boom in the U.S., which created an abundance of light oil, ultimately lowered the BTU value of gasoline. This is unlikely for a couple of reasons. First, to change the energy content of gasoline you must change the composition. […] But the other reason that shale oil can't be the culprit is that U.S. oil production didn't start to move higher until 2009. By then, the EIA was already reporting that U.S. gasoline's energy content had fallen to 121,167 BTU/gal. Here's the real culprit: The 2005 energy bill gave us the Renewable Fuel Standard (RFS), which mandated that an increasing amount of ethanol had to be blended into the fuel supply. As the mandate ramped up, so did ethanol production. In turn, the energy content of gasoline declined. The energy content of ethanol is 76,000 Btu/gal, so as ethanol blending ramped up, the energy content in a gallon of gasoline fell.
Electric vehicles emit more CO2 than diesel ones, German study shows -Electric vehicles in Germany account for more CO2 emissions than diesel ones, according to a study by German scientists. When CO2 emissions linked to the production of batteries and the German energy mix - in which coal still plays an important role - are taken into consideration, electric vehicles emit 11% to 28% more than their diesel counterparts, according to the study, presented on Wednesday at the Ifo Institute in Munich.Mining and processing the lithium, cobalt and manganese used for batteries consume a great deal of energy. A Tesla Model 3 battery, for example, represents between 11 and 15 tonnes of CO2. Given a lifetime of 10 years and an annual travel distance of 15,000 kilometres, this translates into 73 to 98 grams of CO2 per kilometre, scientists Christoph Buchal, Hans-Dieter Karl and Hans-Werner Sinn noted in their study. The CO2 given off to produce the electricity that powers such vehicles also needs to be factored in, they say.When all these factors are considered, each Tesla emits 156 to 180 grams of CO2 per kilometre, which is more than a comparable diesel vehicle produced by the German company Mercedes, for example. The German researchers, therefore, take issue with the fact that European officials view electric vehicles as zero-emission ones. They note further that the EU target of 59 grams of CO2 per km by 2030 corresponds to a “technically unrealistic” consumption of 2.2 litres of diesel or 2.6 litres of gas per 100 kms.
Southern California Edison to add 195 MW of energy storage, DR by 2021 -Southern California Edison (SCE) on Friday announced that it signed seven contracts for 195 MW of energy storage and demand response resources to meet local capacity requirements in its Santa Clara sub-area. The selected resources — one demand response and six energy storage projects following two SCE solicitations — are expected to go online before the summer of 2021, according to a press release. The company pointed out that no gas-fired resources were selected. One of the contracts, a 100 MW energy storage project awarded to Strata, will become one of North America's largest operational lithium-ion battery systems when it comes online in December 2020, SCE said. By concluding another solicitation for energy storage resources, SCE continues its run as one of the country's leading utilities in storage deployment. SCE's vision to add 30 GW of additional renewable capacity to California's electric grid by 2030 makes energy storage increasingly important. The seven new projects, which remain subject to California Public Utilities Commission (CPUC) approval, further the utility's clean energy goals."Unlike other solicitations to increase the generation capacity of the overall electric system, this solicitation specifically sought to meet local needs in the Moorpark area and address electrical energy storage needs related to restricted natural gas operations at Southern California Gas Company's Aliso Canyon Natural Gas Field," Colin Cushnie, vice president of energy procurement and management at SEC, said in a statement. SCE's Aliso Canyon Energy Storage 2 request for offers and the Local Capacity requirements request for proposal targeted clean energy resources connecting through the Santa Clara and Goleta substations to address local reliability needs, the company said.
One in four U.S. homes is all electric - A growing number of homes in the United States are all electric, with 25% of homes nationwide using only electricity according to EIA’s 2015 Residential Energy Consumption Survey (RECS). The share of all-electric homes has risen in each census region over the past decade, particularly in the Midwest and South. Changes to the types of equipment used in homes and faster population growth in warmer climates have contributed to the rise in all-electric homes.The high cost of electric heating in colder climates has often limited the use of heat pumps and other electric equipment in those areas, but improvements to heat pump technology have helped expand their use. From 2005 to 2015, the share of U.S. homes using electricity for their main heating equipment increased from 30% to 36%, with the share of heated homes using a heat pump increasing from 8% to 12%. At the same time, the share of homes using electricity for their main water heater increased from 39% to 46%. Single-family detached homes were the least likely to be all electric (18% in 2015), while mobile homes were the most likely (44% in 2015). Newer homes were also more likely to be all electric: 35% of homes built in 1980 or later used only electricity, compared with 17% of homes built before 1980. Some end uses in homes, such as air conditioning and lighting, only use electricity. Others, such as space heating, can use a variety of fuels. The end uses considered for this analysis include space heating, water heating, air conditioning, lighting, cooking, clothes dryers, swimming pools, and hot tubs. Not included are outdoor grills, natural gas- or solar-powered outdoor lights, and uses not listed in the RECS questionnaire.
New Report Shows Duke Energy's Clean Energy Claims Don't Match Its Fossil Fuel Investments, Fights Against Rooftop Solar Duke Energy, the nation’s largest investor-owned electric utility, claims to be a climate and environmental leader, but a closer look reveals a dirty energy portfolio and consistent efforts to preserve a fossil fuel-based future. While the utility’s CEO, Lynn Good, writes in Duke's 2018 Sustainability Report, “Duke Energy has been leading the charge to a cleaner energy future while helping our communities thrive,” a newly published report by the nonprofit Environmental Working Group (EWG) tells a much different story. By examining Duke’s current electric generating portfolio, the company’s actions, and key regulatory findings, EWG paints a picture of a utility that has been extremely slow to transition to renewable energy resources and that actively fights against customers’ ability to generate their own carbon-free electricity. According to Duke’s 2018 Annual Report, of all of the electricity delivered to its 7.7 million customers, only 2 percent was generated from renewable resources. Meanwhile, a total of 65 percent of Duke’s electricity was generated from fossil fuel-fired power plants: 31 percent from coal and and 34 percent from natural gas and fuel oil. The other 33 percent came from nuclear plants.
North Carolina, Duke Energy Contest Coal Ash Cost, Removal Scope -North Carolina's environmental agency exceeded its authority by ordering Duke Energy Corp. to dig up all of its coal ash and move it from unlined storage sites where toxic chemicals have seeped into water supplies, the country's largest electric company said Friday. Duke Energy said an administrative challenge to the state Department of Environmental Quality decision that the agency didn't consider all the scientific evidence when it announced earlier this month that the company couldn't use a lower-cost option. The storage basins at six coal-burning power plants affected by the agency's order are considered low risk and neighbors are already being connected to drinking water supplies beyond their water wells, the company said. Coal ash is the residue left after decades of burning coal to produce electricity. It contains toxic metals such as mercury, lead and arsenic. The state agency jumped the gun by ordering everything excavated before considering steps to protect public health and the environment that would be cheaper than complete removal, Duke Energy's lawyers said. "DEQ's order is not supported by the evidence (including scientific evidence) and imposes significant and unjustified expense on Duke Energy and its customers without measurable environmental benefits," said the company's brief to the state's Office of Administrative Hearings, which hears challenges to agency decisions. The company has said it wants to cover the storage pits at six of its 14 North Carolina coal-burning power plants with a waterproof cap, saying that would prevent rain from passing through and carrying chemicals through the unlined bottoms. The Charlotte-based power giant has projected the cost of removing coal ash from eight of its 14 North Carolina coal-burning power plants at about $5.2 billion. The extra excavation the state environmental agency demanded at six additional plants could nearly double the cost to $10 billion, Duke Energy said.
North Carolina coal ash battle comes to a head as Duke challenges cleanup order - Coal ash policy has been a heated topic between Duke Energy and environmentalists in North Carolina for years. Disputes range from controversy over how the coal ash is stored, whether it's polluting surrounding groundwater, how much clean up would cost and who's going to pay for it.The debate hit a number of pressure points in recent months: In November, the utility's own filings found that 24 of its 26 coal ash ponds were not compliant with federal coal combustion residual rules. The only two basins in compliance had already been fully excavated, fueling environmentalists' argument that full excavation is the only way to protect groundwater from the toxic chemicals.Furthering that debate, the state's Department of Environmental Quality (DEQ) earlier this year ordered the utility to excavate all its coal ash ponds, agreeing with environmentalists that the method was the "only closure option that meets the requirements of [the] Coal Ash Management Act to best protect public health."Now, the battle is coming to a head.Duke filed a petition on Friday challenging the DEQ's April order. On the same day, the North Carolina Attorney General and the Sierra Club filed an appeal with the state Supreme Court against the Public Utilities Commission's earlier rate approval that would require Duke customers to absorb the costs of the utility's coal ash clean up. The estimated cost of the cleanup was $5.6 billion before the DEQ excavation order, and now the utility says it will cost $4-5 billion more.Also on Friday, the Energy Justice NC Coalition released a report detailing Duke campaign spending on local legislators and how that ties to a bill the utility is pushing through the state Senate, opposed by business, environmental and consumer protection groups. The bill would, in part, allow Duke to establish multiyear rate cases, and although the utility doesn't have a set plan, "it could be used to incorporate coal-ash recovery," Duke Energy North Carolina President Stephen De Maytold the Charlotte Business Journal.
Louisiana House to debate keeping industrial pollution reports secret - Louisiana legislators are considering whether chemical plants and other industrial facilities should be allowed to conduct voluntary pollution audits that would remain secret and to grant legal immunity for certain violations discovered by the audits.A bill authorizing the audits advanced out of the House Natural Resource and Environment Committee on Wednesday (May 1) by a vote of 13 to 3. It now goes to the full House for debate.House Bill 510 was backed by the chemical and oil industries and mirrors similar legislation recently enacted by more than 20 other states, including Texas and Mississippi. The bill was opposed by environmental groups and legal scholars who called it a vaguely-crafted piece of legislation that affords protections for wrong-doing. “Public health and environmental decisions need no secrecy,” said Oliver Houck, a Tulane University law professor. “To the contrary, they are very much assisted by full disclosure.” Houck noted that rules requiring public records of toxic releases have helped to curb pollution and inform communities about health and safety risks.Louisiana has nearly 500 large facilities regulated under the Clean Air Act. Many of them are concentrated in the Mississippi River communities between Baton Rouge and New Orleans, where cancer risk is considered high by federal regulators. Republican Rep. Stuart Bishop of Lafayette proposed HB 510 and defended it as a “tool for industry to promote better business.” By granting facilities a measure of legal immunity, the bill would allow more open communication with the state Department of Environmental Quality, the agency that regulates the chemical and oil industries, Bishop said.
TVA coal ash case: Judge denies contractor's appeal in lawsuit - A federal judge has denied an appeal by a Tennessee Valley Authority contractor that sought to delay the next phase in an ongoing lawsuit that accuses the company of poisoning some workers in the cleanup of the nation's largest coal ash spill. “The old legalism, ‘time is of the essence,’ rarely holds true in appellate practice,” U.S. District Judge Tom Varlan wrote in his ruling Monday. Jacobs Engineering was seeking an appeal of a preliminary ruling in a federal lawsuit stemming from how it conducted its portion of the cleanup of the 2008 spill of 7.3 million tons of coal ash at TVA’s Kingston Fossil Plant in Roane County. Jacobs' attorney Theodore Boutrous Jr. said Monday the company will now ask the Sixth Circuit U.S. Court of Appeals to overturn Varlan's ruling. “The first phase of trial in this case was fundamentally flawed, both factually and legally, and it will necessarily lead to a violation of the U.S. Constitution," he said in an email. "We intend to ask the Sixth Circuit to immediately intervene and prevent the violation of Jacobs’ Seventh Amendment right to a fair jury trial.” Mediation is supposed to begin in early May. The case stems from the assertion by about 70 workers or their survivors that they were poisoned by coal ash — the byproduct of burning coal to produce electricity — during the years-long clean up of the Kingston spill. TVA’s own internal records — obtained as part of an ongoing USA TODAY NETWORK-Tennessee investigation — show coal ash produced at its plants, including Kingston, contains concentrated forms of at least 26 toxins, heavy metals and radioactive isotopes, including arsenic, beryllium, chromium, lithium, mercury, radium, selenium, sulfate and thallium. Workers in the seven-year clean-up operation who toiled in coal ash for as much as 70 hours per week were never told about all those toxins and heavy metals, the news investigation has shown. Even now, TVA does not list radium as an ingredient of its coal ash on material safety data sheets. A decade after the spill, more than 40 workers are dead and at least 400 are sick, according to an ongoing tally compiled by the Knoxville News Sentinel. A handful of workers filed suit against Jacobs in 2013. Jacobs is accused in the lawsuit of telling workers coal ash was safe enough to eat, denying them adequate masks or respirators and Tyvek body suits, and failing to ensure monitors to test for safe conditions were properly maintained.
State regulators 'bending over backwards' to accommodate Justice mining companies, environmental groups say - — The numerous coal companies that belong to the family of West Virginia Gov. Jim Justice have allowed thousands of acres of southwest Virginia surface mines to go unreclaimed for years, even as the state agency tasked with enforcing reclamation laws has repeatedly bent its own rules to give the companies more time. Officials with the Virginia Department of Mines, Minerals and Energy say they’re trying to prevent the multi-million dollar clean-up bill from landing on taxpayers, but environmental activists say the agency’s accommodations just leave the unreclaimed land in limbo, even as the problem exposes structural flaws in Virginia’s enforcement of mine reclamation. Federal guidelines under the Surface Mining Control and Reclamation Act of 1977 require land that’s been mined to be reclaimed — companies must plant trees, bushes and other vegetation and implement structures to control water runoff and erosion. However, the Justice companies have failed at this, racking up so many penalties that in 2014, the DMME allowed them to enter into a compliance agreement that laid out steps to let the companies catch up on payments for numerous violations while continuing the process. The compliance agreement has been amended four times since then to allow the mines even more latitude, and the Justice companies have been hit with another $536,000 in penalties for failing to comply with the agreement. This all squares with Justice’s longstanding reputation for failing to pay taxes, penalties and bills. But some environmental groups say the problems with Justice mines in Southwest Virginia are so bad that they have the potential to structurally destabilize the collective pool of money maintained by the DMME to reclaim surface mines should the owners default. “Essentially, Justice’s liability is so great that if he were to go under, if he were to go bankrupt and forfeit all of his bonds, the bond pool would completely disappear by many many times over,” said Matt Hepler, an environmental scientist with Appalachian Voices.
Morningstar: Gas generation could top coal in Midcontinent power market this year - Coal generation within the Midcontinent ISO is rapidly losing ground to natural gas power in early 2019, Morningstar Commodities Research power and gas associate Dan Grunwald wrote April 24. In April, coal and natural gas economics inverted in MISO, indicating that gas is set to overcome coal as the No. 1 generation source for the ISO as it did in the PJM Interconnection for the first time in 2018. Meanwhile, as natural gas “is having its moment,” renewables are quickly becoming mainstream, Grunwald wrote. Earlier this month, the U.S. Energy Information Administration again reduced its forecast for future coal production in the U.S. as power plant retirements are expected to continue. If Grunwald is correct that the underlying fuel dynamics are leading to increased natural gas dominance in MISO, the ISO will join much of the rest of the U.S. in ceding coal generation’s lead role to natural gas. Only the Southwest Power Pool would still count coal as its dominant source of power, Grunwald wrote. “Changing dynamics this year as evidenced by April so far are pointing to the region approaching a tipping point in its generation stack,” Grunwald wrote. “If 2019 is not the year of natural gas in MISO, then 2020 surely will be.” For the past several years, coal and gas generation in MISO have risen and fallen together as the generation cycle moves between summer, winter and shoulder seasons. This shoulder season, however, natural gas continued to grow as coal generation dropped to a new low. “Beyond summer, current prices look to show natural gas pulling away further out into the curve,” Grunwald wrote. “This is not good news for coal as the reduced capacity factor from reduced run times has further put pressure on coal plant economics, which may lead them out of the market altogether.”
NRC says Vermont Yankee cask maker violated safety regulations - Federal officials say a company that manufactured fuel-storage casks at Vermont Yankee violated safety regulations in connection with loose parts found in those casks at other sites. The Nuclear Regulatory Commission this week finalized its enforcement action against Holtec International. Officials said the company did not follow proper procedures in modifying the design of its casks, which are used to store radioactive material at nuclear plants around the country. However, the defect was not found at Vermont Yankee. Also, federal regulators and a Holtec executive said the defects were not found to have hindered the casks’ function. Vermont Yankee stopped power production at the end of 2014, but all of the plant’s spent nuclear fuel remains at the Vernon site due to the federal government’s failure to establish a disposal site. Last year, then-owner Entergy completed a $143 million project to transfer Vermont Yankee’s spent fuel from a cooling pool to sealed casks. Holtec made those casks and also handled the fuel move. But that project was halted for nearly two months after a loose part was found in a Holtec cask at the closed San Onofre nuclear plant in California. The part was identified as a shim standoff pin, and another broken pin later was found at Holtec’s facility in Camden, N.J., NRC spokesman Neil Sheehan said.
As Nuclear Waste Piles Up, Private Companies Pitch New Ways To Store It : NPR -- Congress is once again debating how to dispose of the country's growing inventory of nuclear waste. Sen. John Barrasso, R-Wyo., is proposing legislation that would jump-start licensing hearings for the Yucca Mountain nuclear waste storage site in Nevada. The Trump administration also is asking Congress for money to resume work on that decades old project. But that may not end local opposition or a longstanding political stalemate. And in the meantime, nuclear plants are running out of room to store spent fuel. A map of current storage sites for high-level radioactive waste and spent nuclear fuel in the U.S. Department of Energy Running out of room The Peach Bottom Atomic Power Station in south-central Pennsylvania illustrates the problem. It's one of 80 sites, across dozens of states, where nearly 80,000 metric tons of waste from power plants is stored where it was generated, at taxpayer expense. Spent fuel removed from the Peach Bottom reactor is first stored in racks in a big pool. It's surrounded by a bright yellow plastic barrier and signs that read "Caution: Radiation Area." "They are under about 22 feet of water," says reactor engineering manager Mark Parrish. "They are continuously being cooled, as they still have some amount of decay heat even after they've operated in the reactor." Once it's safe to remove the spent fuel from the pool, it's stored outside in white metal casks that look like big hot water heaters. They are lined up on a concrete base behind razor wire and against a hillside near the power plant. Currently there are 89 casks at Peach Bottom with room for three more, says Pat Navin, site vice president for Exelon, the company that partially owns and operates the power plant. "That is 40 years worth of spent fuel stored over there currently and it's less than the size of a football field," says Navin. "Probably half a football field." But without a permanent disposal site, Navin says they're going to run out of room. So they're expanding the temporary storage to hold all the waste generated through the 60 years the plant is licensed to operate.
As Ohio nuclear bill advances, Democrats seek to raise renewable standard - A second version of legislation in Ohio designed to subsidize the operation of two nuclear power plants appears to have the same limitations on renewable energy development as the first version. Meanwhile, Democrats have announced an alternative plan, which would increase the state’s renewable energy standard to 50% by 2050. Substitute House Bill 6, introduced to members of the Ohio House Energy Generation subcommittee minutes before a scheduled fourth hearing late Thursday, keeps language that would allow utilities and independent retail power suppliers to ignore previously enacted renewable energy benchmarks which top out at 12.5% by 2027. Without those benchmarks, wind and solar developers worry that the utility market for their power would weaken. For consumers and Ohio businesses, the future would definitely be more expensive under HB 6, though the amended version encourages state regulators to develop “reasonable arrangements” for industry. The bill as now written would eliminate the minor fees associated with acquiring renewable energy, 10 cents to 69 cents a month on residential bills, but would require customers to continue paying for energy efficiency programs mandated since 2009. Those programs would now disappear after 2020 but could be resurrected by utilities if approved by regulators. The revisions leave unscathed the bill’s most expensive feature — new customer fees amounting to more than $300 million annually to create a Clean Air Fund. About half of that money would go to the Perry and Davis-Besse nuclear power plants operated by FirstEnergy Solutions on Lake Erie. The Republican majority on the subcommittee voted five to three to move the bill — without discussion — to the larger House Energy and Natural Resources Committee for a hearing as early as Monday.
ODNR Issues 10 Permits in Utica Shale– The Ohio Department of Natural Resources issued 10 new permits for horizontal wells in eastern Ohio’s Utica shale last week, the agency reports. According to ODNR’s latest drilling update, five wells are targeted for Monroe County – three of them secured by Eclipse Resources and two by CNX Gas Company LLC. Ascent Resources was awarded two permits for wells in Jefferson County, Gulfport Appalachia and Rice Drilling received a permit each for wells in Belmont County, and Utica Resource Operating LLC secured a single permit for a well in Guernsey County. As of April 27, ODNR had issued 3,071 permits in the Utica shale. Of that number, 2,581 are drilled and 2,179 are in production. Permit and drilling activity has concentrated on the southeastern portion of the state, where the most productive oil and natural gas wells are located, data show. As of April 27, there were 17 rigs operating across the Utica, four more than the previous week, according to ODNR. There were no permits issued in the northern section of the Utica shale, which includes Mahoning, Trumbull and Columbiana counties. Nor were there new permits issued in the neighboring Utica region of Mercer and Lawrence counties in western Pennsylvania, according to the Pennsylvania Department of Environmental Protection.
Medina group worried about emissions at Nexus station - — A Medina County group that fought against the Nexus pipeline is raising concerns about emissions from the Wadsworth Compressor Station on Guilford Road. Sustainable Medina County requested Earthworks, a Washington D.C. organization, to use an infrared camera to record emissions from the station March 15. The video of unknown gases going into the air was shared on YouTube. "Looking at it should cause anyone concern. That plume is coming out of that compression station daily," said Kathie Jones, co-founder of Sustainable Medina County. "We need to know what's in there. We need to know how it's going to affect our air, our water and our environment." The 256-mile pipeline began operating last November. Mary Emhoff, a Brunswick Hills resident, fears the emissions could cause health problems for nearby residents. "When they do blowdowns, this pipeline is under 1,500 PSI (pounds per square inch). Your car tires are 35 PSI. That's a lot of compressed gas," Emhoff said. "These pipelines do have leaks. They do explode in addition to the pollution that's going out every day." Adam Parker, a spokesman for Enbridge, which shares ownership of the pipeline, said emissions from compressor station are comparable to dry cleaners, gas stations or small paint shops. "The group's news release attempts to sensationalize the operation of the station, all while acknowledging that the facility holds a permit from the Ohio EPA which went through an extensive regulatory review and public comment period nearly three years ago," Parker said. James Lee, a spokesman for the Ohio EPA, said Nexus received a permit to install and operate the natural gas compressor station in 2016. Before issuing the permit as final, Ohio EPA reviewed the application to ensure emissions would comply with state and federal pollution standards, laws and regulations, Lee said. "The regulations applicable to this natural gas compressor station do not require zero air pollution," Lee said. "The majority of emissions from gas release events are associated with routine planned operations such as startup and shutdown, reduced pressure demand events or maintenance activities," Lee said.
Oilfield company accused of bilking employees out of insurance premiums - The owner of an oil and gas trucking company that until recently was based in Chartiers Township is being sued by former employees who say he canceled their health insurance without telling them but for months continued to deduct money that ostensibly was going toward the premiums.The 16 plaintiffs named in a complaint filed Monday in Washington County Court of Common Pleas were working for Mustang Oilfield Services LLC as of Aug. 1, when the company ended the health, vision and dental coverage it had been offering.The nonunion employees allegedly continued forfeiting money for their share of the insurance premiums. Their attorney, John Egers, said he doesn’t know where that money went instead.“They were taking these deductions, and weren’t applying them to insurance,” said Egers, who’s with the Julian Law Firm in Washington. “We’re going to find out where this money went.” Egers said in an interview the deductions from his clients’ weekly paychecks ranged from $47 to $145. They’re trying to recover that money and other losses they suffered as a result of the insurance cancellation.The complaint also says eight of the former workers are still owed wages despite leaving the company at least two months ago. Along with Mustang, company president Gregory Cook is named as a defendant. Cook, who lives in Belmont County, Ohio, is the company’s only registered owner. Mustang occupied a warehouse on Alpha Drive but no longer does. It was registered in Ohio in 2013 and is still listed as active by the state.
Sunoco’s $200 million expansion at Marcus Hook terminus in Delaware County to create 1,200 construction jobs - The parent company of Sunoco Pipeline LP on Monday announced $200 million in new projects in Delaware County that will employ as many as 1,200 trade workers over the next two years at the Marcus Hook Industrial Complex, terminus of Sunoco’s contentious Mariner East pipeline project. Energy Transfer Partners (ETP), the Dallas parent of Sunoco Pipeline, said the construction projects would be scheduled under a recently signed agreement with the Philadelphia Building and Construction Trades Council, the umbrella organization that counts among its members more than 50 unions that work in the construction industry in the region. Energy Transfer held the event as a counterweight to its recent clashes with prosecutors and anti-pipeline activists over construction of its pipelines in Delaware and Chester Counties, which has been fined repeatedly by regulators and become the object of criminal investigations. The Marcus Hook complex, which housed a Sunoco oil refinery that shut down in 2011, was repurposed to store natural gas liquids like propane, produced in western Pennsylvania and Ohio, which are carried across the state in two Mariner East pipelines. The complex now receives about 200,000 barrels of gas liquids a day, according to Hank Alexander, ETP’s senior vice president of business development, surpassing the amount of petroleum products that were processed daily during its previous life as a refinery. While some of the propane and butane are sold into local markets, the complex is primarily a terminal for export to Europe. It’s designed to load large vessels such as the Corsair, a 738-foot gas liquidscarrier that was berthed Monday, receiving a shipment of propane and butane.
Sunoco buys two homes at Chester County site of Mariner East 2-related sinkhole - Sunoco Pipeline bought two homes on Lisa Drive, the Chester County development and pipeline construction site where residents have been tormented by sinkholes since late 2017, according to state and county documents obtained on Monday. The documents said Sunoco agreed to buy the homes and land of John Mattia and his next-door neighbors, T.J. Allen and Carol Ann Allen, for $400,000 each in transactions dated April 18. A Realty Transfer Tax Statement of Value filed with the Pennsylvania Department of Revenue records a “total consideration” of $400,000 for each of the properties. The home sold by the Allens is estimated with a market value of about $300,000-$330,000, according to listings by Zillow and Realtor.com. The value of the former Mattia home is estimated at about $340,000, according to Redfin, a real estate brokerage. The documents, posted on the Chester County Recorder of Deeds website, show the residents agreed to sell at a site where Sunoco has struggled to build and operate the Mariner East pipelines because of unstable limestone geology. The residents are subject to nondisclosure agreements. Two of the Lisa Drive residents, Russell and Mary March, and another nearby homeowner sued Sunoco in March 2018, claiming the company had negligently drilled through porous rock near their homes without recognizing that sinkholes would likely result, and ignoring the results of a geotechnical investigation there. The suit was settled but the terms were not disclosed. The company’s activities at Lisa Drive have been shut down twice by regulators on the grounds that public safety is endangered by construction of two new pipelines – Mariner East 2 and 2X – plus the operation of an existing natural gas liquids pipeline – Mariner East 1 – on a geologically unstable site.
KDKA Investigates: Residents Of Butler Co. Community Blame Fracking For Bad Water, But DEP Says Otherwise – The Woodlands is a tight little community of a few dozen families who live in trailers and modest homes on a 100-acre patch in rural Butler County. Folks there don’t have much money but say they once had clean water.“Water was good. Never had no trouble. Then they started fracking,” John Fair said. Eight years ago, Rex Energy began drilling for shale gas on the outskirts of the Woodlands, and people like Fair say their well water suddenly turned rancid and gave them rashes after showering.“Smelled first. It got that rotten egg smell first, and then it started getting that brown color to it,” he said. Today, people here still don’t have clean water and travel weekly to nearby White Oak Springs Presbyterian Church for cases of donated clean water. They still blame fracking and the now-bankrupt Rex Energy for contaminating their wells. “Big corporation versus little guy, so who’s going to win?” In Plum, the state Department of Environmental Protection is now investigating whether a Huntley and Huntley drill site has contaminated a private well nearby. While drilling is facing stiff opposition in the northern suburbs, the state grand jury is now taking testimony about its environmental impacts. But does shale gas drilling pose a serious threat to our water supplies? State data and two recent scientific studies seem to say that the threat may be overstated. The evidence indicates that while water contamination from drilling is possible, it is also rare. In their study, Penn State scientists reviewed data from 1,385 shale gas wells in Bradford County and found only the possibility of contamination near seven of them. In addition, Yale University installed eight monitoring wells near drill sites in Washington County, drawing samples over two years. Yale detected no groundwater impacts, and while methane levels changed, their scientists concluded these were natural variations not related to drilling. “This is a very safe industry when it comes to impact on ground water quality,” geologist Fred Baldassare said. Early on, this was not the case — most notably back in 2009, when stray methane gas polluted some 64 water wells in Dimock, Pa. It inspired the movie “Gasland,” with people igniting gas out of their faucets.
'They're exploiting a broken system': Property owners decry pipeline procurement process — Much to Gary Erb’s chagrin, a natural gas pipeline now cuts across his 72-acre homestead in Pennsylvania. To his even greater chagrin, the Conestoga Township resident remains unpaid for the 6 acres of land that were taken from him under eminent domain to build the pipeline. With the help of a Virginia-based legal group, he is petitioning the U.S. Supreme Court to end what he and his lawyers say has become a common practice in the pipeline industry: taking the land first, and paying later. “They’re making millions in profit, and we still haven’t gotten a dime,” Erb said in a phone interview. “They’re exploiting a broken system.” There have been more than 200 instances of courts granting pipeline companies immediate possession of land, while at the same time deferring the issue of how much the property owners will be paid for it, said Robert McNamara, an attorney for the Institute for Justice, a libertarian public interest law firm based in Arlington that is representing Erb and others in similar situations. Those cases have occurred in Alabama, Florida, Georgia, Illinois, Maryland, Montana, New Jersey, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Virginia, and West Virginia, McNamara said. The pipeline affecting Erb was built by Tulsa, Oklahoma-based energy company Williams, which constructed the Atlantic Sunrise project to expand its pipeline network and carry gas fracked from the Marcellus shale formation in northeastern Pennsylvania to the Mid-Atlantic region and beyond. McNamara acknowledged that federal law gives energy companies the ability to invoke eminent domain to build pipelines. But the Natural Gas Act, the law that governs the land seizures, provides no mechanism for companies to take possession of the land without first negotiating a price with the landowner.
In Some Pennsylvania Pro-Fracking Corners, Name-calling, False Claims, and Swastika-Laden Images Circulate – DeSmog - Cabot Oil and Gas is a shale drilling company that, according to state regulators, botched its shale gas extraction operations in an area around Carter Road in Dimock, Pennsylvania, about a decade ago.Cabot has for years fought liability for locals’ contaminated water supplies and has remained in legal disputes long after reaching secret settlements with many Carter Road residents that reportedly included non-disclosure agreements. More broadly speaking, the evidence linking shale industry activity to drinking water contamination is already well established, not just by the U.S. Environmental Protection Agency, but also by the U.S. Department of Justice, state regulators (documenting thousands of spills at fracked wells), and countless peer-reviewed scientific papers. Nonetheless, Stark’s claim that fracking opponents are part of some sort of scheme was picked up by a major natural gasPR shop and by a far-right industry news service, Marcellus Drilling News (MDN), which mixes a sizable dose of slurs, name-calling, and prejudice into the news clips it circulates to subscribers daily, and whose editor is friendly with Stark and with Cabot. Run by Jim Willis, MDN has compared multiple fracking critics — everyone from state attorneys general to climate scientists to a group representing 16,000 doctors and medical students — to Nazis.One of Willis’s apparent favorite images, used to accompany more than two dozen articles, shows a bright green man wearing a gas mask, surrounded by a garish rainbow, with a giant swastika on his chest. “Enviro-Nazis Say Marcellus Pipelines Equal Global Warming,” a headline to one such piece reads. Willis also used the image next to his commentary on attorneys general investigating Exxon for potentially misleading investors about risks associated with climate change — or what Willis called “[u]nbridled, Nazi-like powers against private citizens and private companies by a state run amok…”How about the Pennsylvania Medical Society, founded in 1848 and representing 16,000 doctors and medical students across the state? That’s “controlled by a small and dedicated group of radical leftists” and “shockingly stupid,” Marcellus Drilling News said in a post adorned with the swastika graphic and decrying the group’s call for a ban on fracking in Pennsylvania.
Wolf aide won’t face charges following ethics investigation - The State Ethics Commission will not charge a Wolf administration official with violating the state’s Ethics Act, citing a lack of evidence against her. Wolf’s deputy chief of staff Yesenia Bane is married to a gas industry lobbyist and was the subject of a formal ethics complaint over her involvement in natural gas projects.In an April 19 letter to Bane, commission assistant counsel Jeffery Frankenburger wrote there is “insufficient evidence of a motivated, directed action on your part to obtain a private pecuniary benefit for your husband and/or his employers.”As StateImpact Pennsyvlania first reported in 2016, Yesenia Bane’s husband, John Bane, is a natural gas industry lobbyist (then for Buchanan Ingersoll & Rooney, and now for EQT). At the time, Yesenia Bane’s daily schedule showed she was routinely involved in matters related to her husband’s gas industry clients. Shortly after the story was published, she was reassigned to work on other issues.Frankenburger wrote, “your position, coupled with the employment of your husband as an industry lobbyist, created a perception that your actions in fulfilling the Governor’s policy agenda was a way for you to financially benefit your husband and/or his employers.” He said the commission could not meet the burden of “clear and convincing proof” that Bane had violated the Ethics Act.
Top environmental official’s reconfirmation hearing delayed over pipeline concerns -A state Senate committee postponed a planned confirmation hearing for one of Pennsylvania’s top environmental officials, after a bipartisan group of lawmakers raised concerns about his agency’s involvement in controversial gas pipeline project.The Senate Environmental Resources & Energy Committee met Tuesday morning to vote on the nominations of Department of Environmental Protection Secretary Patrick McDonnell and Cindy Adams Dunn, secretary of the Department of Conservation and Natural Resources.Gov. Tom Wolf nominated McDonnell and Dunn to their cabinet positions in 2016 and 2015, respectively. They’re now being considered for reconfirmation.The Senate committee questioned Dunn on Tuesday and voted unanimously to send her nomination to the full Senate.But it postponed its hearing for McDonnell, who did not appear at the meeting.Last week, five senators from Chester and Montgomery counties wrote to committee Chairman Gene Yaw, R-Lycoming, and its ranking Democrat, John Yudichak, of Luzerne County, asking them to put McDonnell’s reconfirmation on hold while county and state officials investigate the Mariner East II Pipeline project.The pipeline started transporting natural gas across 17 counties in southeastern Pennsylvania in December 2018. That came after a two-year construction period that was prolonged by multiple regulatory shutdowns and technical problems.Sunoco Pipeline LP, which constructed Mariner East II, and its parent company Energy Transfer Partners are the subject of a joint investigation by state Attorney General Josh Shapiro’s office and the Chester County district attorney. The probe was spurred by allegations of criminal misconduct related to the pipeline’s construction.In their April 25 letter, Democratic Sens. Andrew Dinniman, Katie Muth, Tim Kearney, and Daylin Leach, along with Republican Tom Killion, said that the investigations “specifically cite state regulators” including the Department of Environmental Protection, which has granted permits for the project and levied fines against Sunoco for non-compliance with state regulations. A separate investigation by the Pennsylvania State Ethics Commission also involves McDonnell’s communication with staff in Wolf’s office, the letter says.
Southwestern Energy Sets Record Drilling Pennsylvania Lateral 18000 Feet-Plus -Southwestern Energy Co. beat several of its own records, including those for completion stages, drilled footage and lateral lengths, during its first full quarter as an Appalachian pure-play operator. COO Clay Carrell said the company set a new pad record of 8.3 completion stages per day and drilled 8,300 feet in a 24-hour period in the first quarter. A Marcellus Shale well in Tioga County, PA, also tested at a record 39 MMcf/d. Southwestern added that an 18,683-foot lateral it drilled set a state record in Pennsylvania, while another 18,000-foot lateral it drilled during the first quarter set a company record in West Virginia. CEO Bill Way said the company’s average lateral lengths are expected to increase by 35% to over 10,000 feet this year.The company produced 182 Bcfe in 1Q2019, compared to 226 Bcfe in the year-ago period and 234 Bcfe in the fourth quarter. Southwestern sold its Fayetteville Shale assets in December, which accounted for 67 Bcf of production in 1Q2018.But in Appalachia, where the company operates in the northeastern and southwestern parts of the basin, production increased 14% year/year during the first quarter, while liquids production from the basin was up 33% to 71,740 b/d. Now one of the largest natural gas liquids (NGL) producers in the basin, Southwestern is guiding for a 20% annual increase this year in liquids production, or 75,600 b/d. To do that, the primary focus is the Southwest Appalachia division, where assets in southwestern Pennsylvania and northern West Virginia are to receive the bulk of this year’s capital budget. While the Northeast Appalachia division drove dry gas production at 1.24 Bcf/d, the Southwest Appalachia division accounted for the majority of NGLs at 71,680 b/d, thanks in large part to the area’s liquids-rich Marcellus Shale. Those assets produced 345 MMcf/d of natural gas.Management said the company continues to evaluate the Upper Devonian and Utica shales throughout its footprint, along with the Upper Marcellus interval.The company drilled its fourth Upper Devonian well during the first quarter and plans to complete it in the coming months. It also plans to drill three Upper Marcellus wells in Pennsylvania during the second quarter. After its first Utica test in 2017, management again said the company plans to continue gathering data from those wells until it builds more of the asset into its program.
New Wells to Hit Moon and Back -- More than 620,000 miles of new oil and gas wells will be drilled over the next five years, according Rystad Energy’s latest forecasts. That’s enough to get to the moon and back with distance to spare. The energy research company predicts that the number of onshore and offshore oil and gas wells drilled globally will increase to around 65,000 this year. Activity levels are then forecasted to remain around this level through 2023. “North America will be in a league of its own thanks to the shale boom. Nearly six in ten new wells on the continent will be drilled in shale basins,” Erik Reiso, head of consulting at Rystad Energy, said in a company statement. “These wells are typically longer than other supply segment wells. This helps explain why shale wells represent around 80 percent of the distance drilled in North America by 2023,” he added. Reiso also revealed that the top four offshore operators will add a quarter of new offshore wells going forward, whereas the top ten in the onshore market represent around one-third of new wells from 2019 to 2023. “[This implies] a much more diversified player landscape,” Reiso said. Earlier this month, Rystad Energy revealed that free cash flow for public exploration and production companies “skyrocketed” last year to almost $300 billion. “For these players, 2019 could turn out to be another blockbuster year,”
Gulfport Energy: Production To Rebound After Q1 2019 - Gulfport Energy saw its Q1 2019 production fall significantly compared to Q4 2018 as it didn't have many wells turn to sales during Q4 2018 and Q1 2019. Gulfport still expects that its average 2019 production will be close to its Q4 2018 production level since its completion activity is starting to ramp up. Although natural gas prices have been somewhat weak, Gulfport appears to be 101% hedged on its 2019 natural gas production (at guidance midpoint), so gas prices aren't going to meaningfully affect its cash flow for this year. The reduction in activity levels can be seen in how many net wells Gulfport turned to sales in various quarters. During each of Q2 2018 and Q3 2018, Gulfport had 15.5 net wells turned to sales for the Utica Shale. This helped contribute to Gulfport's Q3 2018 production averaging 1,427.5 MMcfe per day, around 11% above Q1 2018 levels. Gulfport's activity in Q4 2018 slowed down, with the number of net wells turned to sales around half that of Q3 2018. This contributed to Gulfport's Q4 2018 production falling around 2% from Q3 2018 levels. The drop in production from Q4 2018 to Q1 2019 was even more significant at -9% since Gulfport only turned 8.8 net wells to sales in Q1 2019, and 6.0 of those net wells barely contributed to the quarter's numbers since they started production in the last few days of the quarter. Production is expected to pick up significantly in Q2 2019 and Q3 2019 due to the large number of wells (more than in Q3 2018) that Gulfport plans to turn to sales. This may result in Q2 to Q4 2019 averaging over 1,400 MMcfe per day, over 10% higher than Q1 2019 production levels.
EPA Declines to Regulate Waste as Ohio Valley Fracking Booms - The U.S. Environmental Protection Agency last week said it will not strengthen regulations on waste created by oil and gas production, a move that could affect communities across the Ohio Valley where the oil and gas industry is booming in the Appalachian Basin. No federal agency fully regulates oil and gas drilling byproducts — which include brine, or salty water laced with chemicals and metals, as well as similarly-contaminated sludge, rock and mud — leaving tracking and handling to states. EPA’s decision released last week stems from a 2016 lawsuit filed by environmental groups, who had petitioned the agency to make new rules for how it regulates oil and gas waste. When the agency failed to respond, a federal judge required EPA to formally respond by this spring.The decision reaffirms that states are in charge of regulating the disposal of chemical-laced and often radioactive liquids and solids created by the oil and gas industry.Environmental advocates decried the move. They argue regulations for both onsite storage of waste and offsite disposal vary widely from state to state.A 2016 report from the Center for Public Integrity calls the radioactive waste stream from horizontal oil and gas operations “orphan waste” because no single government agency is fully managing it. Each state is left to figure out its own plan. Advocates say EPA rules would create a baseline for how millions of tons of liquid and solid waste should be disposed.“In a word or a sentence, the Trump administration hung out to dry communities that host oil and gas development,” said Aaron Mintzes with Earthworks, one of the group’s that pursued this issue in court.Mintzes said a loophole in the Resource Conservation and Recovery Act, a federal law that governs how solid waste should be disposed, allowed EPA in 1988 to classify waste from oil and gas operations as “non-hazardous.” This gives operators wide latitude in how to dispose of it.For example, some states allow drillers to dispose of wastewater by injecting it back into the ground, but that can lead to pollution and even earthquakes.In its decision document, EPA acknowledged that the rise of hydraulic fracturing, in which drillers go much deeper and are more likely to bring up waste products with naturally-occurring radioactivity, has changed the composition of waste. Ultimately, however the agency said state programs appear to sufficient.
Ethane storage seen as key to revitalization of Appalachia - (AP) — Plans are underway in Appalachia to create two underground facilities to store ethane, a byproduct of natural gas drilling seen as integral to revitalizing a region still struggling from the loss of industrial and manufacturing jobs decades ago. Experts say the availability of storage facilities will help the tristate region of eastern Ohio, southwestern Pennsylvania and northern West Virginia attract petrochemical plants that turn ethane into raw plastic and, the hope is, attract manufacturing companies to make products ubiquitous to modern life. Energy Storage Ventures is awaiting approval of state permits to construct an underground facility to store ethane and other natural gas liquids, said David Hooker, the Colorado-based company's president. Meanwhile, Appalachia Development Group in Charleston, West Virginia, wants to build a much larger storage facility somewhere in the tristate region. Company President and CEO Steven Hedrick said the creation of a petrochemical and plastics industry could lead to billions of dollars in investment and tens of thousands of jobs in the coming years. Technological advances in hydraulic fracturing, better known as fracking, have helped fuel an oil and gas boom in Appalachia and southwest states like Texas. It has also provided an abundant supply of ethane that is driving the expansion of the petrochemical industry in its epicenter along the Gulf Coast of Texas and Louisiana, where most ethane storage also is located. "The people of Appalachia deserve this opportunity," Hedrick said.
EQM says 'unlikely' to complete Mountain Valley natgas pipe in 2019 -(Reuters) - EQM Midstream Partners LP said Tuesday it was “unlikely” to complete the long-delayed $4.6 billion Mountain Valley natural gas pipeline from West Virginia to Virginia during 2019 due to ongoing legal and regulatory challenges.EQM, however, said in its first-quarter earnings report that the joint venture building the project “continues to target a full in-service date for the fourth quarter 2019.”EQM Chief Executive Thomas Karam told analysts on a call that the project was about 80 percent complete and the company remained confident it would get the pipeline built.When EQM started construction in February 2018, it estimated Mountain Valley would cost about $3.5 billion and be completed by the end of 2018.The 303-mile (488-km) pipeline is designed to deliver 2 billion cubic feet per day (bcfd) of gas.
MVP Start-Up This Year 'Unlikely,' but Challenges Show Pipe's Value, Says NextEra Exec - After an unfavorable federal court decision earlier this year, the Mountain Valley Pipeline (MVP) probably won’t meet its target in-service date in late 2019, but the regulatory setbacks and rising costs could serve to further demonstrate the project’s value.That’s according to NextEra Energy Inc. CFO Rebecca Kujawa, who acknowledged during a conference call to discuss 1Q2019 results that legal setbacks make it “unlikely” that MVP will enter service by 4Q2019 as previously planned.Kujawa specifically pointed to a February decision by the U.S. Court of Appeals for the Fourth Circuit to deny an en banc rehearing of an earlier ruling overturning the Atlantic Coast Pipeline’s (ACP) permit to cross the Appalachian National Scenic Trail. Backers for the 300-mile, 2 million Dth/d MVP had been watching the case closely, as their project also aims to cross the trail and could be jeopardized by the court’s ruling. “While we continue to advance MVP toward ultimate completion and we expect to ramp up construction activities in the coming months, the Fourth Circuit's decision not to pursue an en banc review on the Atlantic Coast Pipeline Appalachian Trail crossing authorization presents a challenge to both timing and cost,” she said. “Since the original court decision, we have been working with our project partners on several alternatives to address the issue, and we continue to vigorously pursue these paths. “At this point our previously announced fourth quarter 2019 target in-service date appears unlikely. We are continuing to work through options with our partners, and we'll provide a further update in the near future.” MVP is a joint venture of EQT Midstream Partners LP, NextEra US Gas Assets LLC, Con Edison Transmission Inc., WGL Midstream and RGC Midstream LLC. The greenfield project aims to cross from West Virginia into Virginia to deliver Marcellus and Utica shale gas to an interconnect with Transco (aka, the Transcontinental Gas Pipe Line) in Pittsylvania County. MVP, like the similarly routed ACP, has faced significant legal and regulatory setbacks and rising costs. As a large pipeline attempting to traverse sensitive terrain along the Virginia/West Virginia border, the project has been a prime target for environmental groups in the proxy war over fossil fuels that has figured prominently in FERC proceedings and in the courts. MVP’s sponsors have shown no signs of giving up on the project, which could prove even more valuable than previously thought given the extent of the challenges the developers will have overcome getting the pipe in the ground, according to Kujawa.
W.Va. DEP Changes State-Imposed Regs for Stream Crossing Permits - West Virginia environmental regulators have changed some state-imposed conditions to a federal permit issued for stream crossings for natural gas pipelines approved by the U.S. Army Corps of Engineers. In a letter sent to federal regulators last week, West Virginia Department of Environmental Protection (WVDEP) officials submitted a series of changes to the state-imposed onditions for the Nationwide Permit 12.The changes include the removal of a 72-hour time restriction for construction of interstate natural gas pipelines under waterways in certain cases.To cross under streams, rivers and wetlands, major pipeline projects need a permit from the Army Corps under Section 404 of the Clean Water Act. The permits detail how much sediment or debris can end up in waterways during construction of interstate pipelines, but also dams, levees and major highway projects.The Nationwide Permit 12 is one Section 404 permit. It is used to authorize utility line construction as well as to authorize the building of natural gas pipelines.Under federal law, states can add special conditions to those permits. WVDEPbegan the process of updating West Virginia's 401 Water Quality Certification standard and special conditions in August 2018.The WVDEP previously required interstate pipelines must be built under major rivers within 72 hours.This caused problems for the 303-mile Mountain Valley Pipeline. Last year, a federal court threw out the project’s Section 404 permit after environmental groups argued pipeline developers’ own planning documents showed they couldn’t meet that 72-hour waterway crossing deadline. Currently, the project is awaiting new Section 404 permits and can’t do construction under waterways.The new modifications clarify that stream crossing methods that are done when streams are flowing must be completed within 72 hours, but that stream crossings where waterways are damned, also called the "dry ditch" method, are exempt from the 72-hour requirement. Construction and access bridges and crossings on Section 10 rivers are also exempt from the 72-hour requirements, the letter states.
Pipeline Protester Arrested, Faces Felony Charge — A West Virginia official says a North Carolina man protesting the Mountain Valley Pipeline has been charged with a felony. Monroe County Circuit Court deputy clerk Andrea Preston told the Bluefield Daily Telegraph that 22-year-old Holden Dometrius was charged Thursday with threat of terrorist acts after chaining himself to a piece of equipment in the pipeline's path. He also faces lesser charges of trespassing, obstructing and tampering with a vehicle. According to the group Appalachians Against Pipelines, it is the first felony charge against a protester. The Mountain Valley Pipeline is a 300-mile (483-kilometer) natural gas pipeline that is being constructed in West Virginia, Virginia and North Carolina. It has used eminent domain to acquire project space. It wasn't immediately clear whether Dometrius has an attorney.
After Approving Enbridge Permit, Massachusetts’ Environment Secretary Lands Job with Project’s Contractor - Massachusetts’ Secretary for Energy and Environmental Affairs, Matthew Beaton, has accepted a position at a consulting firm working for oil and gas pipeline builder Enbridge on a controversial project for which Beaton’s Department of Environmental Protection (DEP) recently approved a crucial permit.Governor Charlie Baker’s administration announced on Monday that Beaton has been hired as vice president for renewable energy and emerging technology at TRC Companies, a large environmental and engineering firm working mainly for the oil and gas industry.The move comes less than four months after the DEP approved Enbridge’s controversial air permit for its planned compressor station in Weymouth, outside Boston, as part of the company’s Atlantic Bridge project. TRC Companies is Enbridge’s environmental contractor in the project and has been working on Enbridge’s pipeline projects in the Northeast for the past several years. Last year alone, Enbridge’s subsidiary, Algonquin Gas Transmission, paid TRC Companies nearly $1.8 million, recent Federal Energy Regulatory Commission filings show.The Office of Energy and Environmental Affairs did not respond to several questions from DeSmog, including when Beaton began his job negotiations with TRC.As DeSmog has extensively reported, the Atlantic Bridge project and its compressor station, which will help pump natural gas through pipelines, have been fraught with potential conflicts of interest and improprieties. In the latest revelation, DEPfailed to include in the station’s health impacts assessment unreported air samplings it conducted at the Weymouth site.Those samplings showed elevated levels for several carcinogens and other pollutants, including 1,3-butadiene and acrolein.Citizens and experts who are appealing the permit have included these revelations in their appeal, which the DEP will hear next month. Environmental activists have mixed reviews of Beaton’s record. During his tenure, the state has facilitated a massive investment in offshore wind off the coast of Martha’s Vineyard and bolstered climate adaptation and mitigation programs.
New York State Bans Offshore Oil and Gas Drilling - Governor Andrew M. Cuomo hammered home New York's vehement opposition to harmful and outdated offshore drilling Monday by signing A. 2572/ S. 2316. The legislation, sponsored by Assemblyman Steve Englebright and Senator Todd Kaminsky and passed overwhelmingly by the Legislature the first week of February, amends state law to:
- Ban oil and gas exploration, development and production in state coastal and tidal underwater land; and
- Prohibit construction of any new infrastructure in New York to transport oil and natural gas developed in the North Atlantic Planning Area, the federal government's designation for federal waters offshore the tri-state area and New England.
Governor Cuomo has made crystal clear his opposition to drilling offshore New York and this ban stands in sharp contrast to the Trump administration's extreme oil and gas leasing proposal to open virtually all ocean waters more than three miles from shore to oil and gas drilling — the entire East Coast, West Coast, Gulf Coast and Alaska. The new law drives home state opposition to offshore oil and gas development and constructs an important roadblock to any efforts to bring ashore oil drilled throughout New England and the tri-state area. But New York will also need to keep fighting the Trump administration's planned expansion of offshore drilling. While the Trump administration's revised proposal appears to be on hold for now, the administration's interest in opening our waters to more offshore drilling remains and the drilling planning process could restart at any moment.
N.Y. Bans Offshore Drilling in Effort to Prevent Trump Expansion -- New York State has banned offshore oil and natural gas drilling along its Atlantic coastal waters in an effort to block a Trump administration proposal. Gov. Andrew Cuomo (D) signed legislation (A.2572/S.2316) on April 29 that bars state agencies from granting permits for drilling or oil or gas exploration on state-owned underwater coastal lands, his office announced. The law, effective immediately, also prohibits the leasing of land that would lead to an the increase of oil or natural gas production from federal waters, according to the measure. The legislation, passed by the state Senate and Assembly in February, is in response to the Trump administration’s plans to expand offshore drilling off most U.S. coastal waters. Interior Secretary David Bernhardt in an April 25 Wall Street Journal article said those plans may be on hold indefinitely after a federal ruling upheld an Obama-era ban on drilling in the Arctic and Atlantic oceans. The drilling plan has received pushback from officials in several states, with California, Delaware, Maryland, New Jersey, and Oregon enacting laws blocking expansion of federal oil and gas leasing off their shores, according to the announcement. Other states have introduced similar measures including Connecticut, Florida, Georgia, Massachusetts, New Hampshire, and Rhode Island and South Carolina. “This bill says no way are you going to drill off the coast of Long Island and New York, because we must lead the way as an alternative to what this federal government is doing,” Cuomo said.
U.S. still processing Atlantic seismic permits despite drilling plan delay (Reuters) - The U.S. Interior Department is still processing permit applications for companies to conduct seismic testing in the Atlantic - a precursor to drilling - despite shelving its plan to vastly expand offshore drilling, a spokeswoman said on Monday. Atlantic coastal state lawmakers, businesses and conservation groups are adamant that Interior should not allow seismic testing - a process that often uses powerful air guns to map resources below the ocean floor - arguing the surveys hurt marine life, such as the endangered North Atlantic right whale. Newly confirmed Interior Secretary David Bernhardt said last week the agency’s five-year plan for oil and gas drilling on the Outer Continental Shelf (OCS) would be sidelined indefinitely after a March court ruling blocked drilling in the Arctic and part of the Atlantic Ocean. But Interior’s Bureau of Ocean Energy Management, which is responsible for managing energy development on the OCS, continues to review the applications of a half-dozen seismic testing companies awaiting permits to test for oil and gas drilling potential on the Atlantic Ocean floor. “BOEM is continuing to process the permit applications for conducting seismic surveys in the Atlantic, consistent with applicable law,” BOEM spokeswoman Tracey Moriarty said in an emailed statement on Monday..
Do oil and ice mix? Researchers study winter oil spills in the Straits --The continued operation of Line 5, which is now more than 65 years old, carrying up to 540,000 barrels of crude oil a day en route from Superior, Wisconsin to Sarnia, Ontario, is a source of concern for many in the Great Lakes region. In a survey conducted last fall through the same study program that Gunn is a part of, 44 percent of Michigan residents who were familiar with the pipeline said they were “extremely concerned” about a spill. For those in the scientific community, some of those concerns are based on the fact that there has been no comparable case study showing the potential effects of a massive oil spill into a large freshwater body. Scientific research has attempted to fill in some of those gaps, and researchers from several different universities and agencies have developed models showing possible best- and worst-case scenarios in a variety of open water conditions on the Great Lakes. Some studies have even looked into marginal ice cover conditions. But Gunn says there is still a major blind spot when it comes to a consolidated ice cover. That’s what happens to the Straits in the peak of the winter season, when water currents from Lakes Michigan and Huron converge, pushing all of the ice into a single mass that covers 90 to 100 percent of the surface. Gunn’s three-day fact finding mission is one step in an ongoing process contributing to the general body of knowledge on some of those issues. He and four other individuals are in the middle of a one-year pilot study, funded by MSU’s Institute for Public Policy and Social Research, looking into the perceived and actual risks associated with Line 5. The other researchers involved include assistant professors Doug Bessette and Michelle Rutty, associate professor Robert Richardson and professor Volodymyr Tarabara. While on the Straits, Gunn used ground-penetrating radar and global position technology to measure the depth and roughness of the ice. The general hypothesis is that the rougher the ice is, the more likely it is to trap the oil in one place; and the thicker the ice is, the less likely oil is to spread above the surface. Water currents in the Straits are less pronounced when covered in ice because they are not as influence by wind conditions, but currents still exist beneath the surface. That would also impact where the oil goes. And there are concerns that having a thick, reflective sheet of ice covering the water will make it harder to locate the oil if it were to spill.
Michigan AG: I'll move to shut oil pipeline if talks fail (AP) — Michigan’s attorney general pledged Monday to move to shut down an oil pipeline in the Great Lakes if the governor doesn’t find a “swift and straightforward” resolution to the contentious issue. Gov. Gretchen Whitmer last month halted state agencies’ work to facilitate construction of a tunnel beneath the lakebed to house a new segment of Line 5 in the channel where Lakes Huron and Michigan meet, pointing to a legal opinion from Attorney General Dana Nessel while citing concerns that her Republican predecessor’s plan would keep the existing 66-year-old pipeline in the water too long. But the Democrat said this month she was open to still building the tunnel. Her administration is in talks with pipeline owner and operator Enbridge. “I respect the Governor’s effort to find a swift and straightforward resolution to this issue, but if unsuccessful I will use every resource available to our office to shut down Line 5 to protect our Great Lakes,” Nessel, a Democrat who promised during her campaign to close the pipeline, said in a short statement. A spokeswoman later said while Nessel was reluctant to impose a specific deadline on Whitmer’s efforts with Enbridge, she was hopeful that the governor by June 1 would have a plan for decommissioning Line 5. “The Attorney General shares the Governor’s sense of urgency to remove the pipeline from the Great Lakes at the earliest possible moment,” said Kelly Rossman-McKinney. Nessel released an opinion last month saying a law enacted in December to implement former Gov. Rick Snyder’s tunnel deal is unconstitutional. As a candidate, Nessel said she would seek a court injunction to shut the pipeline by alleging that Enbridge violated a 1953 state easement. Although the federal government regulates oil pipelines, Michigan owns the lake bottom and granted the easement allowing the pipeline to go there. Line 5 carries about 23 million gallons (87 million liters) of crude oil daily between Superior, Wisconsin, and Sarnia, Ontario. The underwater segment that traverses the Straits of Mackinac is divided into two side-by-side lines.
Report warns Enbridge, DTE, part of pipeline "bubble" that could burst - A new report by an energy watchdog group says companies are betting over a trillion dollars in risky gas pipeline projects. Global Energy Monitor says these projects are hugely expensive - so the payback is over decades. Climate scientists say we need to stop burning fossil fuels completely by 2050. That means the pipelines could become stranded assets for the companies. Enbridge Energy is engaging in a particularly risky expansion, according to Ted Nace, co-author of the report. He says Enbridge, the world's third largest pipeline company, has a heavy debt load. That could leave the company at risk of needing government bailouts if global demand for natural gas stays stagnant, or falls. Nace says investors are already turning away from fossil fuel projects over concerns about climate change. That makes Enbridge Energy's plan to put its Line 5 into a tunnel under the Straits of Mackinac a risky bet, he says. "After they finish building that tunnel, will anyone be interested in the product that's going through the tunnel?" he asks. In a statement, a spokesman for Enbridge said the company has "the scale, financial flexibility and market access to be an energy leader in the gathering, processing and transporting of crude oil, liquids and natural gas across North America."
Dominion to resume work on US Atlantic Coast natgas pipe in third quarter (Reuters) - Dominion Energy Inc said on Friday it expects to resume construction of the $7.0 billion-$7.5 billion Atlantic Coast natural gas pipeline from West Virginia to North Carolina in the third quarter and complete it by early 2021, despite legal and regulatory challenges. The company still needs to resolve two major legal cases before it can complete the project, which has been on hold since late last year. Atlantic Coast is designed to carry 1.5 billion cubic feet per day of gas from the Marcellus and Utica shale in Pennsylvania, Ohio and West Virginia to the U.S. Southeast. One billion cubic feet is enough gas for about five million U.S. homes for a day. Dominion suspended construction in early December after the U.S. Court of Appeals for the Fourth Circuit stayed a permit from the U.S. Fish and Wildlife Service that authorized building the pipe in areas inhabited by threatened or endangered species. The company said oral arguments in that case will be presented on May 9, with a decision expected about 90 days later. Dominion said a positive decision would allow it to restart partial construction in the third quarter. Dominion is also seeking an order from the U.S. Supreme Court overturning a Fourth Circuit decision that invalidated the U.S. Forest Service’s authorization to build the pipe across the Appalachian Trail. That case, if the Supreme Court takes it up, would be heard in 2020, so full construction would resume after that decision, Dominion said. When the company started work on the 600-mile (966-km) Atlantic Coast in the spring of 2018, Dominion said it expected the project would cost an estimated $6.0 billion-$6.5 billion and be completed in late 2019. Since then, Dominion has upped the project costs and extended the timeline.
Piedmont Natural Gas to start soon on $250M storage project in NC, names contractor Piedmont Natural Gas has chosen Matrix Service Inc. as its principal contractor for the $250 million liquefied natural gas (LNG) storage project it proposes to build in Robeson County. Construction could start as early as the end of this month, says Piedmont spokeswoman Tammie McGee. The company now estimates that about 150 workers will be employed during construction of the facility. When the facility is completed in 2021, it will employ as many as 12 full-time employees. The project is designed to store natural gas for use during peak demand on cold winter days, particularly as a hedge against the polar-vortex events that sent temperatures to record lows in the Carolinas over the last few years. The project is being built about 15 miles northwest of where the $7.5 billion Atlantic Coast Pipeline is supposed to end near Lumberton. That pipeline is designed to transport natural gas collected in the Marcellus and Utica shale fields from West Virginia to southeastern North Carolina. The pipeline is on hold for now, with construction blocked in federal courts. But Piedmont says the projects are not related. The Robeson facility can store gas shipped by either the ACP, if it is completed, or the Transco Pipeline running through central and western North Carolina, which is currently the only interstate pipeline transporting gas here. The 1 billion-cubic-foot storage facility will cover about 60 acres of a 685-acre tract between Maxton and Red Springs already owned by Piedmont. When finished, this will be the fourth LNG facility owned and operated by Piedmont. The Charlotte-based natural gas company operates storage facilities in Huntersville and Bentonville as well as in Nashville, Tennessee.
Bills Bans 2 of 3 Forms of Oil, Gas Fracking in Florida (AP) — Two forms of fracking for oil and natural gas exploration would be banned in Florida under a bill that cleared state House and Senate committees Tuesday, leaving in place a third technique opponents say would still threaten water supplies and the state's fragile environment.The House Appropriations subcommittee on agriculture and natural resources voted 10-2 for the bill, which would permit a rock-dissolving technique called matrix acidizing but ban two other common forms of fracking. Later Tuesday, the Senate Innovation, Industry and Technology Committee voted 6-4 for a similar bill.Environmental groups call that a loophole, putting underground aquifers at risk of contamination from potentially dangerous chemicals. The petroleum industry also opposes the bill because it would halt use of other fracking techniques.But legislators who voted in favor called the measure a major step forward in curbing the practice in Florida."Is it completely perfect? Is it everything we want? No, it's not," said Democratic Rep. Kristin Jacobs of Coconut Creek. "We have to do something. The idea that we're not going to act because it isn't perfect, I reject."The Senate version also leaves in place the matrix acidizing fracking procedure."If you don't ban that you don't ban fracking," said Democratic Sen. Oscar Braynon of Miami Gardens.Only New York, Vermont and Maryland have enacted total bans on fracking, which uses high-pressure liquids to create cracks in underground rock, allowing pockets of oil and gas to flow freely. Nationwide, fracking has been credited with dramatically increasing U.S. oil and natural gas production, with about two-thirds of the nation's active wells using fracking techniques. Yet critics have long been concerned about environmental issues, including a sharp increase of earthquakes in Oklahoma, possible water and air contamination and use of deep ground injection to dispose of waste.In Florida, environmental groups say the state's porous limestone rock makes fracking an even greater threat, particularly since most of the state's drinking water comes from underground aquifers. And that, they say, includes the chemical-laden matrix acidizing procedure that oil industry officials say is most commonly used to clean and maintain wells. "From our perspective it's not a fracking ban unless all forms of fracking are banned," said Kim Ross of Rethink Energy Florida.
Seismic Blasting Permits Move Forward Even as Plans for Offshore Drilling are Paused - The Trump administration has temporally halted plans to open most of the nation’s coast, including the Atlantic continental shelf, to offshore drilling, but seismic airgun blasting may still happen.According to the Bureau of Ocean Energy Management (BOEM), permitting for seismic surveys in the Atlantic Ocean continues to move forward.Seismic surveys involve the use of undersea airguns to search for fossil-fuel deposits buried deep beneath the seafloor. The blasts can occur for days and weeks, using multiple cannons that can be heard for thousands of miles. The sound damages and disorients sea life such as whales, dolphins, and sea turtles and destroys food sources like fish eggs and larvae.The National Marine Fisheries Service has issued incidental harassment authorizations (IHAs) to five companies, which allow them to harm sea life while conducting surveys between Delaware and Florida. The companies await final permits from BOEM.According to a business group representing the five companies — ION GeoVentures, based in Houston; Spectrum Geo Inc. of England; TGS-NOPEC Geophysical Company of Norway; WesternGeco of England, a division of Schlumberger; and CGG, based in Paris — they all intend to continue seeking the permits.According to Oceana, seismic airgun surveys in the Atlantic Ocean could injure 138,000 whales, including the endangered North Atlantic right whale.
Trump Admin Maps the Ocean for Industry Exploitation - As part of its Blue Economy initiative, the Trump administration has developed a map to provide oceanindustries information on areas ripe for oil rigs and floating factory farms.The map brands these areas as "ocean neighborhoods." Though that sounds pretty cozy, it is nothing close to reality. What's in store for these "neighborhoods?" Massive rigs and other infrastructure, increased vessel traffic and noise, the inherent risk of dirty oil spills and blowouts and unavoidable toxic discharge. Although the map touts "a fountain of data for use by industry," it ignores several components of the ocean ecosystem and certain coastal communities that are already struggling and need increased protections — not increased development. Users can view the migratory pathways of sharks and fish — but not other migratory species like seabirds and turtles. You can see critical habitats designated pursuant to the Endangered Species Act, but not the habitats for every threatened or endangered species (not all species receive critical habitat protection). Finally, feeding areas for cetaceans (whales, dolphins and porpoises) are shown, but what about breeding areas for these struggling species? And, where are the other species protected under the Marine Mammal Protection Act: sirenians (manatees and dugongs) and marine carnivores (like seals, otters, walrus and polar bears)? Trump's new industry-focused map does not include this vital information.While we're at it, what about coastal communities throughout the Gulf of Mexico that are already bearing the brunt of extensive offshore drilling? Thanks to offshore drilling, they are struggling with basic needs like drinkable water and breathable air. But, the map doesn't pay them any credence. Trump must not see them as a priority in determining where to develop next. Since taking office, Trump has prioritized rolling back decades of progress in ocean protection policy. Both former presidents George W. Bush and Barack Obama took steps toward establishing a strong foundation for healthy oceans with protections for marine mammals, the creation of sanctuaries and monuments, improving U.S. fisheries and crafting policies to shield massive swaths of our waterways from dirty drilling activities. Trump has attempted to abolish much of that progress. This map is just one more Trump handout to Big Oiland others in the booming business of ocean industrialization.
Trump loosens safety rules for offshore drilling - Tougher safety standards for offshore oil and gas drilling put in place after the 2010 Deepwater Horizon explosion will be loosened under a regulatory overhaul announced by the Interior Department Thursday. The Trump administration has sought to rollback offshore regulations as a means to increasing production in the Gulf of Mexico and other offshore regions, estimating the changes will save the industry $824 million over the next decade. "The rule eliminates unnecessary regulatory burdens while maintaining safety and environmental protection offshore," Interior Secretary David Bernhardt said in a statement. "Under President Trump's leadership, America is a leader on energy resulting in greater security and economic prosperity."The announcement comes as a victory for oil companies, which have lobbied for changes to the Well Control Rule since it was created in 2016 following the recommendations of a bipartisan commission on offshore oil drilling safety. "The 2016 Well Control Rule, while well-intentioned, was flawed with technical problems that actually detracted from the goal of safe operations," National Ocean Industries Association President Randall Luthi said in a statement. "The oil and gas industry and federal regulators share a common goal: safe, efficient and environmentally responsible development of energy resources." Environmentalists have fought to stop the rollback since a draft proposal was released in late 2017, arguing the rule changes gave oil companies too much slack and risked a repeat of the Deepwater Horizon incident, in which 11 people were killed and more than 3 million barrels of crude spilled into the Gulf of Mexico. Among the changes activists are objecting to is the removal of a requirement that oil and gas drillers hire a third party to test safety equipment like blow out preventers and weakening of a regulation requiring companies to maintain real-time, onshore monitoring stations to make sure wells are being drilled safely.
'Recipe for Disaster': Trump Guts Offshore Drilling Rules Put in Place After Deepwater Horizon Spill - Just two weeks after the nine-year anniversary of the BP Deepwater Horizon disaster—the largest ocean oil spill in U.S. history—the Trump administration on Thursday moved to dismantle offshore drilling regulations aimed at preventing another catastrophic leak. "These rollbacks are a hand out to oil company CEOs at the cost of endangering the lives of their workers and heightening the risk for another environmental catastrophe."—Chris Eaton, EarthjusticeThe White House's revised Well Control Rule—which could save the fossil fuel industry close to a billion dollars over the next decade—was unveiled by Interior Secretary David Bernhardt, a former oil lobbyist who advocacy groups have described as a "walking, talking conflict of interest."Diane Hoskins, campaign director at Oceana, called the Trump administration's move "a major step backward in offshore drilling safety.""Gutting the few offshore drilling safeguards established in wake of the BP Deepwater Horizon disaster is reckless and wrong," Hoskins said in a statement. "More drilling and less safety is a recipe for disaster. We should be implementing new safety reforms, not rolling back the few safety measures currently in place."The rule will go into effect 60 days after it is published in the Federal Register, which could happen as early as Friday.According to the New York Times, one of the major components of the Trump administration's plan "is a significant reduction in the requirement for oil companies to test fail-safe devices called blowout preventers, which are intended to be a last line of defense against disasters like Deepwater Horizon."The White House's revisions also included slight tweaks to the language of existing regulations that environmentalists warned could have massive effects. As the Washington Post reported: "Safety-bureau regulators removed a key word from language describing the level of down-hole pressure the agency requires operators to maintain in a given well to avoid an accident. The word it removed is 'safe.'"
Company to pay $3.5M after Mississippi, Alabama oil spills — An oil company has agreed to pay federal and Mississippi regulators $3.5 million in penalties and do more to prevent oil spills under a legal settlement filed last week. Federal and state regulators sued Denbury Resources of Plano, Texas, on Thursday, and filed a proposed consent decree at the same time. Members of the public have 30 days to comment on the settlement. The lawsuit , filed at the behest of the U.S. Environmental Protection Agency and the Mississippi Department of Environmental Quality, documents oil spills in nine oil fields in central and southern Mississippi, plus one in Citronelle, Alabama, between 2008 and 2015. The EPA says Denbury dumped about 7,000 barrels of oil or mixtures of oil and water. The lawsuit also alleges Denbury failed to submit required facility response and spill prevention and control plans. Denbury isn't admitting fault, but under the consent decree it would agree to enhanced reporting responsibilities as well as a "mechanical integrity program" that calls for surveying and inspecting operations and making repairs to pipelines, tanks and machinery based on how severe an oil spill threat each problem poses.
Republicans Coax Trump to Scrap U.S. Ship Waiver Plan - President Donald Trump pledged he wouldn’t waive requirements that American vessels be used to transport natural gas among U.S. ports, Republicans defending the mandates said after a White House meeting on the issue Wednesday. The lawmakers from Alaska and the shipbuilding Gulf Coast states of Mississippi and Louisiana said Trump ruled out relaxing mandates under the Jones Act in order to facilitate shipments of liquefied natural gas to Massachusetts and Puerto Rico. “He’s not going to make any changes to the Jones Act,” said Senator John Kennedy, a Republican from Louisiana. “The president’s not one to beat around the bush. He was pretty categorical.” The pledge marks a rapid reversal in White House thinking -- and a victory for U.S. shipbuilding interests and their allies on Capitol Hill. The president was said to be leaning in favor of some kind of waiver after an Oval Office meeting on the issue last week. “The president gave his word,” said Senator Bill Cassidy, a Republican from Louisiana. “Every senator who walked out of that room felt confident” he would “oppose any changes to the Jones Act and any waivers of the Jones Act,” Cassidy said. In addition to Kennedy and Cassidy, the lawmakers pressing Trump in Wednesday’s meeting included Alaska Republican Senators Lisa Murkowski and Dan Sullivan; Mississippi Republican Senators Roger Wicker and Cindy Hyde-Smith; and the No. 2 Republican in the House, Representative Steve Scalise of Louisiana.
Enterprise's Lumberjack pipeline to expand Haynesville gas takeaway. The Texas natural gas market is rapidly evolving, in large part due to burgeoning Permian production but also due to gas production gains in East Texas driven by strong returns on new wells in the Haynesville and Cotton Valley plays. Most of this supply growth is looking to make its way to the Gulf Coast, where close to 5 Bcf/d of LNG export capacity is operational and plenty more is under construction. The combination of fast-rising supply and demand is straining the existing gas pipeline infrastructure across Texas, creating the need for more capacity. The Permian has been grabbing the headlines for its extreme takeaway constraints and depressed, even negative supply-area prices, and all eyes are trained on the announced pipeline projects that will eventually provide relief to the region. But pipeline constraints also are developing between the Haynesville and the Texas coast. Today, we discuss the latest solution for the intensifying Haynesville-area supply congestion.
Prices Post New Weekly Low Before Rebounding On Bullish Weather Forecasts -- Highlights of the Natural Gas Summary and Outlook for the week ending April 26, 2019 follow. The full report is available at the link below.
- Price Action: The now expired May contract rose 7.6 cents (3.1%) to $2.566 on a 14.1 cent range ($2.580/$2.439).
- Price Outlook: Prices posted a new weekly low before rebounding and ending higher on the week. The market pushed lower as the EIA reported another weekly record injection, not absolute injection, and inventories rose above last year while continuing to reduce the deficit to the 5-year average. Prices were able to end higher on the week as weather forecasts were considered bullish. Still, with triple digit injections projected for the next weeks, further upside may be limited. CFTC data indicated a (35,674) contract reduction in the managed money net long position as longs liquidated and shorts added. This is the lowest net long position since July 31, 2018. Total open interest rose 71,215 to 3.393 million as of April 23. Aggregated CME futures open interest fell to 1.230 million as of April 26. The current weather forecast is now cooler than 9 of the last 10 years. Pipeline data indicates total flows to Cheniere’s Sabine Pass export facility were at 4.0 bcf. Cove Point is net exporting 0.7 bcf. Corpus Christi is exporting 0.766 bcf. Cameron is exporting 0.105 bcf.
- Weekly Storage: US working gas storage for the week ending April 19 indicated an injection of +92 bcf. Working gas inventories rose to 1,339 bcf. Current inventories rise 58 bcf (4.5%) above last year and fall (372) bcf (-21.7%) below the 5-year average.
- Storage Outlook: The EIA weekly implied flow was (1) bcf from our EIA storage estimate. This week’s storage estimate returned to within our tolerance. Over the last five weeks, then EIA has reported total injections of +200 bcf compared to our +205 bcf estimate.
- Supply Trends: Total supply fell (0.3) bcf/d to 85.2 bcf/d. US production rose. Canadian imports rose. LNG imports fell. LNG exports rose. Mexican exports fell. The US Baker Hughes rig count fell (21). Oil activity decreased (20). Natural gas activity decreased (1). The total US rig count now stands at 991 .The Canadian rig count fell (3) to 63. Thus, the total North American rig count fell (24) to 1,054 and now trails last year by (52). The higher efficiency US horizontal rig count fell (13) to 873 and falls (28) below last year.
- Demand Trends: Total demand fell (1.2) bcf/d to +72.4 bcf/d. Power demand fell. Industrial demand fell. Res/Comm demand rose. Electricity demand fell (1,526) gigawatt-hrs to 66,853 which trails last year by (2,337) (-3.4%) and trails the 5-year average by (1,514)(-2.2%%).
- Nuclear Generation: Nuclear generation rose 271 MW in the reference week to 80,984 MW. This is +2,347 MW higher than last year and +2,927 MW higher than the 5-year average. Recent output was at 80,362 MW.
The cooling season is beginning. With a forecast through May 10, the 2019 total cooling index is at 4 compared to 57 for 2018, 30 for 2017, 6 for 2016, 13 for 2015, 41 for 2014, 26 for 2013, 36 for 2012 and 20 for 2011.
Weekly Gas Storage- Another Large Build - The EIA released its weekly Natural Gas Storage Report today, outlining how national natural gas stocks have changed in the last week. In total, the EIA reports natural gas stocks rose by 123 Bcf last week, increasing to 1,462 Bcf from 1,339 Bcf. This is 9.6% above the 1,334 Bcf that was in storage at this point last year and is 17.8% below the five-year average of 1,778 Bcf. This week’s storage build slightly exceeded expectations, as analysts predicted a build of 114 Bcf. All regions saw a build this week, with the largest in the South Central region, where stocks increased by 50 Bcf. Stocks in every region are below the five-year average. Gas in storage in the Mountain region is the farthest below the five-year average.
Bearish EIA Report Smacks Natural Gas Prices - Natural gas prices returned into the red today, with the June contract closing just over three cents lower on the day. The main culprit was a bearish EIA report, showing a large build of 123 bcf for the week ending 4/26. Despite the large number, it was actually indicative of a slightly tighter supply/demand balance when compared to the prior two weeks. It certainly was not "tight" by any means, as it remained much looser than the same gas week in prior years. Prices did rebound off their lows, however, after being down as much as 5.5 soon after the release of the number. Power burns have been more impressive this week thanks to some heat in the southern states, and we have another burst of early heat in the Southeast on the horizon for next week, as seen in the current 6-10 day forecast from the GEFS. This shows up in our forecast demand chart quite easily, with another bump up in GWDDs mid to late next week. This raises the possibility that we will continue to see some strength in the burns into next week as well, likely one factor that helped us to rebound somewhat today, as the market was forced to weigh this information against the bearish EIA report.
United States has been a net exporter of natural gas for more than 12 consecutive months - U.S. net natural gas exports in February 2019 totaled 4.6 billion cubic feet per day (Bcf/d), marking 13 consecutive months in which U.S. natural gas exports exceeded imports. The United States exports natural gas by pipeline to both Canada and Mexico and increasingly exports liquefied natural gas (LNG) to several other countries.Although U.S. LNG exports have grown in recent years, most U.S. natural gas exports are sent by pipeline to neighboring Canada and Mexico. Natural gas exports to Canada tend to be seasonal, increasing in the winter months because of Canada’s use of natural gas as a heating fuel in its more populous eastern provinces. In contrast, U.S. natural gas exports to Mexico are steadier, reflecting Mexico’s use of natural gas for over half of its power generation and for industrial purposes.U.S. exports by pipeline to Canada have risen since November 2018, when the second phase of the Rover pipelineand the NEXUS pipeline entered service. These two projects bring natural gas from the Marcellus and Utica plays in the Appalachian Basin to the Dawn Hub in Ontario, Canada, near the St. Clair border crossing northeast of Detroit, Michigan. U.S. natural gas exports to Canada were 3.3 Bcf/d in February 2019, the highest on record. Overall, exports of natural gas by pipeline to Canada averaged 2.3 Bcf/d in 2018. U.S. pipeline exports of natural gas to Mexico in 2018 averaged 5.2 Bcf/d, up from 4.2 Bcf/d in 2017. Much of the recent growth is attributed to increased U.S. exports out of the Permian Basin in western Texas as new pipelines were installed and as natural gas-fired power plant projects in Mexico entered service. Several existing pipeline expansions in southern Texas were completed during the past 12 months as well, increasing cross-border capacity.U.S. LNG exports averaged 3.0 Bcf/d in 2018 and recently hit a high of 4.1 Bcf/d in January 2019. The volume of U.S. LNG exports rose steadily during 2018 as three new liquefaction units, called trains, entered service:
- March: A single train at the Cove Point terminal in Maryland
- November: Train 5 at the Sabine Pass terminal near the Louisiana-Texas border
- December: Train 1 at the Corpus Christi terminal in southern Texas
These three trains have a combined capacity of 1.9 Bcf/d, bringing total U.S. LNG export nameplate capacity to 4.3 Bcf/d as of the end of 2018. LNG export volumes are expected to continue to rise in 2019 as an additional 4.0 Bcf/d of liquefaction capacity is brought online by the end of the year. EIA’s Short-Term Energy Outlook (STEO) forecasts that U.S. net natural gas exports will average 4.7 Bcf/d in 2019 and 7.5 Bcf/d in 2020, with most of the growth attributable to increases in LNG exports. However, pipeline exports of natural gas are also increasing. In three months of 2018 (September through November), the United States exported more natural gas than it imported by pipeline, in part because of the October 9, 2018 explosion on the Westcoast pipeline in British Columbia that led Canada to restrict natural gas imports into Sumas, Washington. According to STEO forecasts, the United States will become a net exporter of natural gas by pipeline on an annual basis in 2019.
$200B in the LNG Project Pipeline - Declaring that the “boom is back” for liquefied natural gas (LNG), Wood Mackenzie predicts that capital spending on LNG plant and upstream infrastructure will total more than $200 billion from 2019 to 2025. In fact, a new Wood Mackenzie study anticipates that nearly 90 million tonnes per annum (mmtpa) of LNG capacity should take final investment decision (FID) and start construction in the next two years alone. Engineering, procurement and construction (EPC) contractors and others along the LNG supply chain should get a “major boost” as a result, the consultancy finds. To be sure, Wood Mackenzie points out that the LNG industry is “notorious” when it comes to cost overruns and project delays. The firm points out that only 10 percent of all LNG projects have been constructed under budget and 60 percent have encountered delays. “The many projects jostling for FID right now have low headline costs, but in light of the historical reality of LNG construction, some project delays are likely,” Liam Kelleher, senior global LNG research analyst with Wood Mackenzie, said in a written statement emailed to Rigzone. “While there is a risk that current low LNG prices may see some proposed projects cancelled, Wood Mackenzie believes the risk to new LNG supply development is low and we see considerable upside supply potential.” Kelleher also noted that, in Wood Mackenzie’s high case, the firm projects that an additional 70 mmtpa of capacity could be sanctioned in the next three years. “Should even some of that materialize, construction would be stretched beyond the height of the 2010-14 boom,” said Kelleher, adding that the upcoming construction cycle will not necessarily be a replay of the last. According to Kelleher, a number of factors have changed. “Firstly, the global spread of projects will mean that the local inflation pressure, particularly in terms of manpower, which hit Australia and the U.S. in previous cycles is lessened,” Kelleher said. “Secondly, developers are also being more cautious about LNG development solutions, opting for modularization and capex phasing. This, coupled with renewed caution with investment programs across the upstream sector, should help limit global upstream inflation.” Furthermore, Kelleher pointed out that cheaper raw materials costs – notably subsiding global steel prices – and the entrance of new EPC players translate into strong competition for construction contracts.
Catch A Wave, Part 3 - More U.S. LNG Export Projects Moving Toward FID - The cascade of LNG export project news continues. In the past week, yet another “second-wave” U.S. LNG export project — NextDecade’s Rio Grande LNG — cleared FERC’s environmental review process. That follows news of three other projects that received their environmental approvals this month; plus two other projects — Tellurian’s Driftwood LNG and Sempra’s Port Arthur LNG — got final FERC authorization to construct their facilities, should they make the financial commitment to proceed; and, finally, plans for a brand new export terminal, Venture Global’s Delta LNG, were unveiled. All in all, there are more than 20 announced projects totaling 235 MMtpa (~35 Bcf/d) that are looking to catch the second wave of U.S. LNG exports in the next decade. The timing of their regulatory approvals and final investment decisions will determine, in part, when this next wave — or shall we say tsunami — of export demand will materialize. Today, we wrap up our second-wave LNG project update series with a look at the progress made by some of the remaining projects that we’re tracking. In Part 1, we looked at the regulatory, financial and contracting milestones that make up the years-long, capital-intensive process for bringing liquefaction and export facilities across the finish line. In Part 2, we began our project-by-project update with a look at the first of the stateside second-wave projects to be greenlighted — ExxonMobil and Qatar Petroleum’s (QP) three-train, 15.6-MMtpa (~2-Bcf/d) Golden Pass Products(GPP), proposed to be built at the site of what is a legacy import terminal located in Jefferson County, TX. GPP took FID in early February (2019) and has since also received approval to proceed with initial site preparation, with the first of the three trains due for completion in early 2024. Then there’s Venture Global LNG’s Calcasieu Pass, an 11-MMtpa (~1.4-Bcf/d) project sited in Cameron Parish, LA, that has all but reached FID; the project, whose capacity is just about fully contracted, received its FERC authorization on February 21, its DOE non-FTA authorization two weeks later and already has begun initial construction activity. Next, we shift our focus to some of the other, smaller-scale projects that are targeting FID this year. Across North America, there are about a dozen LNG export projects that fall into that bucket, and eight of those are along the Gulf Coast, including the three pre-FID terminals we discussed above. Among those Gulf Coast projects, there are also two others that hit key milestones in recent months; specifically, they secured critical FERC authorizations, bringing them a step closer to reaching FID:.
Tellurian begins booking capacity on two proposed pipeline projects - Houston liquefied natural gas company Tellurian has started booking capacity on two proposed pipeline projects that will support the growing LNG industry in southwest Louisiana. Tellurian's $1 billion Haynesville Global Access Pipeline will connect natural gas pipelines and production facilities in DeSoto Parish to those in Calcasieu Parish. Once complete in 2023, the 42-inch natural gas and 160-mile pipeline will move up to 2 billion cubic feet of natural gas per day. Recommended Video A separate $1.4 billion project named the Delhi Connector Pipeline will move natural gas from the Perryville/Delhi Hub in Richland Parish to Calcasieu Parish. Once complete in 2023, the 42-inch and 180-mile pipeline will move another 2 billion cubic feet of natural gas per day.
North America's oil and gas pipeline boom could signal meltdown - A report published by Global Energy Monitor cautions that upbeat building spree of US oil and gas pipeline systems may stand on a frail financial fundament, which could see previous turmoil return while bearing considerable risk for investors’ rate-of-return as climate-change consciousness and regulation is expected to increase pressure on fossil fuels. North American overexpansion of oil and gas systems would bear “high leverage and unrealistic expectations”, the authors of the report say, warning that signs of increased risk are looming on the horizon of the present building boom systems. The pace of the global pipeline building is stated to have tripled since 1996. The US is one of the most aggressive builders of oil and gas pipelines systems and its pace appears unprecedented: worldwide it owns 51.5 per cent of all projects in pre-construction or construction stages. The report argues that investors in the booming expansion of oil and gas infrastructure would steer for a similar shock (as experienced some years earlier in the coal mining sector) as “boom-fueled optimism runs into climate realities and fiscal limits”. Ted Nace, co-author of the report and executive director at Global Energy Monitor points out that “enthusiasm [is] spilling out of the fracking boom [and] has fostered unrealistic expectations of expansion in midstream oil and gas infrastructure. Investors are setting themselves up for disappointment”. One reason experts are so worried is that the previous shock would carry much weight pointing towards signs for imminent turmoil within a similar-functioning energy market than coal mining: “The combination of high leverage and expectations for growth based on ever-increasing Asian demand set the stage for investor disappointment and losses”. In the context of the previous crisis “[it] is not just hypothetical: it is exactly the combination of elements that created the coal mining meltdown of 2008 to 2014”. Three areas would be particularly vulnerable in the US to present pipeline expansion concentration, including ‘Permian Basin of Texas and New Mexico’, ‘the Marcellus and Utica shale formations in Appalachia and the Midwest’, and the ‘Canadian tar sands of Alberta’. The decision by the Canadian government last year, to commit C$5bn (£2.9bn) to acquire the Trans Mountain Pipeline would add extra fuel to the fire.
American Refiners Clean Up Their Act-- Oil refiners in the U.S. are using more light crude to fill the gap from the sludgy, sulfurous stuff they used to get from OPEC. Crude shipments from the 14-member cartel to American ports dipped to a 33-year low in February in part because of the pact between OPEC and allied producers to curb output and forestall a global glut. Chronic issues with Venezuelan output and U.S. sanctions barring most purchases have further strained availability of the heaviest types of oil. Starved of OPEC supplies, American refiners in February processed the least-dense crude in data going back to 1985. The so-called oil slate refined that month was just 1.25 percent sulfur -- the cleanest in more than 20 years. U.S. refiners aren’t likely to see OPEC cargoes returning soon. Saudi Arabia, the de facto leader of the Organization of Petroleum Exporting Countries, has indicated they’re eyeing an extension of the cuts for the rest of 2019. That comes just days before the last U.S. exemptions allowing purchases of Iranian crude will expire, which will mean stiffer competition for barrels of heavy crude.
After Houston chemical fires, Texas Senators eye storage tank regulations -- Weeks after a massive fire at a Houston-area petrochemical storage facility garnered national attention, a panel of state lawmakers heard dueling testimony Monday night on a bill that would strengthen state oversight of above-ground tanks that hold petroleum products and hazardous chemicals.Freshman state Sen. Nathan Johnson, D-Dallas, authored Senate Bill 1446. It would require Texas’ environmental regulatory agency to develop and enforce standards for the design and operation of larger storage tanks in areas vulnerable to flooding and hurricanes to ensure that they don’t float away or otherwise fail.Government regulation of storage tanks came roaring back into the spotlight last month when a leak at a Deer Park tank farm owned by Intercontinental Terminals Company sparked a massive fire that spread to almost a dozen more holding drums. There are thousands in the Houston area alone — all sizes, usually made of steel plates welded together. State lawmakers already had been studying oversight of tanks after Hurricane Harvey, when at least 15 drums holding crude oil, gasoline and other hydrocarbons ruptured or malfunctioned. (A Texas Tribune investigation published a year before Harvey detailed research on the vulnerability — and patchy government oversight — of storage tanks.) A December report by the Senate Natural Resources and Economic Development Committee didn’t make explicit recommendations but said lawmakers should move to ensure “that storage tank designs along the Texas coast are protective of human health.”
Pipeline Protesters Could Face 20 Years in Prison Under Bill in Texas House - Under a proposal being considered in the Texas House this week, activists who engage in civil disobedience to stop or delay construction on pipelines would be charged with the same level of felony as attempted murderers. House Bill 3557, by state Representative Chris Paddie, R-Marshall, would increase the penalties and fees for intentional acts that “impede, inhibit or interfere” with the operations of “critical infrastructure,” including electric power facilities, water treatment plants and oil and gas facilities. The bill would go beyond the state’s definition of critical infrastructure to include equipment and projects under construction. Alleged violators would be charged with second-degree felonies, which carry up to 20 years in prison, under HB 3557. Additionally, individuals would face a fine of up to $10,000 and organizations accused of violating the law would face a fine of $1 million. Violators would also be liable for damages.So-called critical infrastructure, specifically at oil and gas pipeline easements, has been the target of protests across the state in the last several years. Environmental activists have delayed construction on pipelines including the southern leg of the Keystone XL in East Texas in 2012 and the Trans-Pecos in far West Texas in 2016 and 2017. Denton protesters also took action to delay operations at a fracking site in 2015 after nearly 60 percent of voters approved a fracking ban that was later invalidated by the Texas Legislature. The new proposal “is criminalizing conscientious, caring people who are the canaries for their communities,” said Lori Glover, co-founder of the Big Bend Defense Coalition, an activist group that mobilized against the Trans-Pecos Pipeline. She and other critics say the measure is unnecessary because laws to protect private property are already on the books.
US total oil, gas rig count adds 18 on week to 1084- S&P Global Platts Analytics - — The US active rig count bounced back this week as operators deployed an additional 18 oil and natural gas rigs to lift the total to 1,084 in the week that ended Wednesday, according to S&P Global Platts Analytics. The number of rigs targeting gas rose by nine to 224, while the oil-directed rig total increased by 11 to 857.While the rig count rose in multiple basins, Oklahoma's SCOOP-STACK added the most at four, increasing to 87. The Bakken Shale's count rose by one to 61 rigs, while Colorado's Denver-Julesburg Basin increased by two to 30.Click here for full-size image The Permian Basin also added two rigs to reach 464. The Eagle Ford proved to be the only oil-rich play to shed a rig, dropping by one to 83.In the gas-rich plays, the Haynesville Shale slid two rigs to 61, while the Marcellus Shale added one rig to reach a total of 63. Rig activity in the Utica Shale remained flat at 15.Oil prices have strengthened over the past year while gas prices have struggled. In late December, the spot WTI crude price fell as low as $44.48/b. However, it averaged around $65/b in April, prompting more activity by producers. However, the spot Henry Hub gas price has reversed course. After averaging more than $3/MMBtu during the first month of 2019, it averaged $2.65/MMBtu in April, due in large part to low domestic demand in the ongoing shoulder season.
The Fastest-Growing U.S. City Is Scrambling to Survive the Shale Boom -- In a state known for its oil-based booms and busts, Jerry Morales is convinced Midland, Texas, the unofficial capital of the Permian Shale Basin, has a chance to break from the pattern. In the Permian, "we don’t say boom anymore," "We’re very sustainable. The boom-and-bust era is over." Midland is using a $100 million bond to fix overused roads, and accessing a $180 million regional fund from a new coalition of 20 drillers for other advances, he said. A $50 million water tower has been approved to serve expanding neighborhoods, and a $3 million animal adoption center is in the works for pets left homeless by apartment-dwelling oil workers. Meanwhile, four drillers led by Chevron Corp. have funded a new childcare facility that opened last week. "I don’t want Midland to be known as a big mancamp," Morales said. "We are having to think outside the box and truly be urban planners, creating a city and an environment that’s inviting for everyone." The Permian rose from the dead with the advent of fracking a decade ago to become a market beast, producing about a third of U.S. oil as it grew to become one of the world’s most prolific oilfields. In the process, though, local resources were stretched beyond their limits. Now, Morales and others say the region may be settling into adulthood. Employers still struggle to fill jobs in competition with the oilfields, roads are jammed, schools overflow and home prices are sky-high. But local leaders say they have plans and resources set to secure a long-term future.
US Oil Output Drops - U.S. crude oil production dropped from January to February this year. U.S. crude oil production dropped 1.6 percent from January to February this year, according to the Energy Information Administration’s (EIA) latest monthly numbers, which were released on Tuesday. Total U.S. crude oil output was 11.683 million barrels per day (MMbpd) in February, compared to 11.870 MMbpd in January, the EIA revealed. February production was 14 percent higher than the same period last year, which registered 10.248 MMbpd. The top crude oil producing area in February was Texas with 4.890 MMbpd. Texas’ crude oil production was up 1.3 percent month on month and 21.8 percent year on year. The Federal Offshore Gulf of Mexico had the second highest crude oil producing figure in February with 1.719 MMbpd. This marked a 9.8 percent decrease month on month and a 0.8 percent increase year on year. North Dakota registered the third highest crude oil output rate at 1.312 MMbpd, which was a 4.6 percent decrease month on month and a 14 percent increase year on year. U.S. natural gas production was at 108.569 billion cubic feet per day (Bcf/d) in February, which marked a 0.5 percent increase month on month and an 11.6 percent rise compared to February 2018. The top natural gas producing areas in February were Texas with 26.500 Bcf/d, Pennsylvania with 18.608 Bcf/d and Alaska with 9.554 Bcf/d. The EIA forecasts that U.S. crude oil production will average 12.4 MMbpd this year and 13.1 MMbpd in 2020, according to the organization’s latest short-term energy outlook, which was released earlier this month. The organization projects that dry natural gas production will average 91 Bcf/d in 2019, up 7.6 Bcf/d from last year.
US oil output decelerates in response to lower prices- (Reuters) - The second U.S. shale oil drilling boom has started to cool as a decline in oil prices since the end of the third quarter of 2018 filters through to lower well boring and completion rates. The first boom ended when prices plunged in the second half of 2014; something similar is happening now, albeit on a milder scale corresponding to the smaller fall in prices. The number of rigs drilling for oil in the United States has fallen by more than 9 percent from its cyclical peak in November, according to oilfield services company Baker Hughes (“North America rotary rig count”, April 26). And crude output is down by almost 300,000 barrels per day (bpd) from its cyclical peak in December, the U.S. Energy Information Administration says (“Petroleum Supply Monthly”, April 30). Much of the recent output decline is attributable to the Gulf of Mexico, where offshore production is often volatile, so it needs to be interpreted with care (https://tmsnrt.rs/2WjeKfd). But onshore output from the Lower 48 states is also now growing more slowly, a sign the drilling boom is beginning to cool. Lower 48 output was up by 1.6 million barrels per day in the three months from December to February compared with a year earlier. Growth is down from more than 1.8 million bpd in August-September and is slowing significantly for the first time since 2016.
The number of drilled but uncompleted wells in the United States continues to climb - The number of drilled but uncompleted wells in seven key oil and natural gas production regions in the United States has increased over the last two years, reaching a high of 8,504 wells in February 2019, according to well counts in EIA’s Drilling Productivity Report (DPR). The most recent count, at 8,500 wells in March 2019, was 26% higher than the previous March.Drilled but uncompleted wells, also known as DUCs, are oil and natural gas wells that have been drilled but have not yet undergone well completion activities to start producing hydrocarbons. The well completion process involves casing, cementing, perforating, hydraulic fracturing, and other procedures required to produce crude oil or natural gas.The number of DUCs has generally increased since the end of 2016. A high inventory of DUCs may be attributable to economic factors or resource constraints. For example, a low oil and natural gas price environment may postpone well completion activities in areas where the wellhead break-even price is too high relative to the current market price. Another example may be the lack of available well completion crews to perform hydraulic fracture activities in areas of high demand. Takeaway capacity, or the ability to transport hydrocarbons through pipelines away from the resource, may also place additional constraints when pipeline networks are insufficient to accommodate supply. Most of the recent increase in the DUC count has been in regions dominated by oil production, especially the Permian region that spans western Texas and eastern New Mexico. As of March 2019, nearly half of the total DUCs included in the DPR were in the Permian region. The Permian Basin experienced takeaway constraints in the second half of 2018, but recent pipeline capacity additions in the region have reduced some of the takeaway constraints. Other pipeline projects are planned or currently under construction. In contrast to oil-directed regions, the number of DUCs in natural gas-dominated DPR regions such as the Appalachian and Haynesville regions has decreased by nearly half over the past three years, from 1,230 wells in March 2016 to 713 wells in March 2019. New pipelines in these regions have increased the ability to transport natural gas to demand centers in the Northeast and Midwest.
Anadarko to resume deal talks with Occidental, says bid could be 'superior' to Chevron's offer - Anadarko Petroleum said Monday it will restart negotiations with Occidental even though it struck a $33 billion deal earlier this month with Chevron to sell its business. The announcement comes after its board unanimously determined that Occidental Petroleum’s rival bid, launched last week, could reasonably lead to a proposal that is superior to Chevron’s previously announced deal to buy Anadarko. Occidental has offered $76 a share for Anadarko, while Chevron has put $65 a share on the table. The board’s determination allows Anadarko and its advisers to resume talks with Occidental under the terms of the Chevron deal. The agreement with Chevron remains in effect, and Anadarko’s board reaffirmed its support for the deal for the time being. Anadarko would have to pay Chevron a $1 billion breakup fee if it decides to sell to Occidental. The announcement is the latest development in a rare bidding war in the oil and gas sector. At the heart of the battle are the crown jewels of Anadarko’s portfolio: a significant footprint in the Permian Basin, the top U.S. shale oil field. Both Chevron and Occidental are seeking to expand their presence in the Permian, which stretches across western Texas and southeastern New Mexico. Occidental CEO Vicki Hollub told CNBC that Anadarko’s Permian assets represent about 75 percent of the deal value.
Anadarko Deal Would Put Occidental Next to Conoco - Occidental Petroleum’s proposed Anadarko Petroleum deal would put the company alongside ConocoPhillips in a peer group of two as a “super-independent”, according to Zoe Sutherland, a corporate analyst at Wood Mackenzie (WoodMac)."If the deal goes through, it would give the company ExxonMobil or Chevron-like Permian scale and set them up to join the million barrels of oil equivalent per day Permian club in the late 2020s, according to our base case,” Sutherland said in a statement sent to Rigzone."The deal highlights that diversity is still valued by U.S. independents and would mark Occidental's entry into deepwater Gulf of Mexico and LNG," Sutherland added. Occidental made a proposal to acquire Anadarko on Wednesday. On April 12, Chevron revealed that it had entered into an agreement to buy Anadarko.In a company statement released on its website yesterday, Occidental said it believed its proposal is “superior both financially and strategically for Anadarko’s shareholders”. Anadarko confirmed on Wednesday that it had received an unsolicited proposal from Occidental. The company said its board of directors will “carefully review Occidental's proposal to determine the course of action that it believes is in the best interest of the company's stockholders”.
Berkshire Hathaway to invest in Occidental Petroleum for Anadarko takeover - Warren Buffett is getting involved in a rare bidding war unfolding in the energy industry. Berkshire Hathaway has committed a $10 billion preferred stock investment in Occidental Petroleum contingent on the company completing its proposed takeover of Anadarko Petroleum. Last week, Occidental made a rival bid for the oil and gas driller, challenging Chevron’s $33 billion buyout of Anadarko. Shares of Occidental fell 4% on Tuesday, while Chevron’s stock popped nearly 3%. A company’s stock price often falls when investors believe it is about to acquire a company. Anadarko’s shares fell about 1.5%. The capital injection from Berkshire could make Occidental a more formidable suitor. In pursuing Anadarko, Occidental is going toe to toe with an oil major with a much bigger balance sheet and whose market capitalization is nearly five times its value. Several analysts initially downgraded shares of Occidental following its bid, with many saying the buyout would carry more risks than Chevron’s proposed takeover of Anadarko. Achieving the benefits of the deal depends in part on Occidental’s successful divestment in $10 billion-$15 billion in assets and achieving $3.5 billion in savings from the tie-up. Berkshire’s involvement suggests the company believes Occidental is best positioned to wring value out of Anadarko’s portfolio. Occidental is focused on Anadarko’s acreage in the Permian Basin, the U.S. shale oil region stretching across western Texas and southeastern New Mexico. Occidental CEO Vicki Hollub has pitched Occidental as a high-performing Permian driller that can enrich Anadarko shareholders by squeezing more oil and gas from the drillers’ wells at lower costs.
Chevron Backs Its Anadarko Deal - Chevron’s signed agreement with Anadarko provides the best value and the most certainty to Anadarko’s shareholders.That’s what Chevron believes, a company spokesperson said in an emailed statement sent to Rigzone late Wednesday.Chevron revealed on April 12 that it had entered into an agreement to buy Anadarko. Following this agreement, Occidental announced on April 24 that it had made a proposal to acquire Anadarko.In a company statement released on its website on April 24, Occidental said it believed its proposal is “superior both financially and strategically for Anadarko’s shareholders”.Anadarko announced on April 29 that it intends to resume negotiations with Occidental in response to its proposal to acquire the company. On April 30, Occidental revealed that Berkshire Hathaway Inc has committed to invest a total of $10 billion in Occidental if the company enters into and completes its proposed acquisition of Anadarko.In a research note sent to Rigzone on Monday, Jefferies representatives put the chances of Chevron raising its offer for Anadarko at 75 percent.“If they do raise it will be into the low $70's per share. Taking the $1b break fee and walking away is an acceptable option,” the representatives said in the research note. Chevron’s deal to acquire Anadarko would shake up the U.S. upstream sector, creating a company that rivals ExxonMobil domestically, according to GlobalData. Occidental’s proposed Anadarko deal would put the company alongside ConocoPhillips in a peer group of two as a “super-independent”, according to Zoe Sutherland, a corporate analyst at Wood Mackenzie.
U.S. oil-storage industry fines soar on air, water violations (Reuters) - Fines for violations of air, water and waste regulations by U.S. petroleum storage facilities so far this year have exceeded all of last year - even without including two major Houston-area disasters in the last month still under investigation - according to a Reuters analysis of federal data. Federal and state fines of storage-tank operators totaled $5.2 million as of April, from $4.1 million for all of 2018 and $2.5 million in 2017, according to data on federal and state penalties analyzed by Reuters from the U.S. Environmental Protection Agency. U.S. petroleum storage operators have added millions of barrels of capacity since 2015 when the United States lifted a 40-year ban on crude exports. The nation is now shipping as much as 3.6 million barrels per day (bpd) overseas, and cheap natural gas prices have fueled a boom in petrochemical production that also necessitates more storage, particularly on the U.S. Gulf Coast. With that, however, have been more air and water quality incidents. “There have been some accidents and an awful lot of expansion,” This year, the average penalty is $218,000, up from $52,000 in 2018. The total number of actions for violations of Clean Air and Clean Water Act regulations was 24, up from 17 by this time last year, the data showed. That figure does not include two incidents in Texas for which federal and state investigations are underway, but no fines have yet been assessed. A March fire at a Houston-area petrochemical storage facility raged for days, sending millions of pounds of carbon monoxide and other gases into the air, and leaking thousands of gallons of fuel and toxic foam into waterways. The blaze at a site along the Houston Ship Channel in Deer Park, Texas, started when a leak from a tank containing volatile naphtha ignited and spread to others in the same complex. Those tanks hold tens of thousands of barrels of products used to boost gasoline octane, and make solvents and plastics. Weeks later, a blast and fire at a separate plant north of Houston that makes an aviation fuel component killed one worker and injured two others. Crude storage capacity is up 17 percent across the nation to 573.6 million barrels since 2015, according to the U.S. Energy Information Administration.
DNR declines to re-issue permit for controversial frac sand mine; case likely to be decided in court After a nearly yearlong review, the Wisconsin Department of Natural Resources has declined to reinstate a wetland permit for a controversial Monroe County frac sand operation.In a decision signed Tuesday, DNR Secretary Preston Cole closed his department’s review without taking any action on a decision by Administrative Law Judge Eric Defort to revoke a permit allowing Meteor Timber to fill 16.25 acres of wetlands.The decision leaves the Georgia company without the permit it says it needed to complete the $75 million processing and loading facility that would serve two nearby mines on land the company acquired when it purchased nearly 50,000 acres of Wisconsin forest.Cole said the issue would be best resolved by mutual agreement or in the courts, where a parallel case is currently on hold.Despite finding that the project would result in “permanent and irreversible” impacts and the loss of 13.4 acres of “exceptional quality” imperiled habitat, the DNR granted the Georgia company a permit in May 2017 that included dozens of conditions and questions. The agency issued a final permit five months later with some of those questions unanswered.Clean Wisconsin and the Ho-Chunk Nation challenged the permit, which they said would open the door to the destruction of more rare wetlands.Defort revoked the permit in May 2018 after a weeklong hearing, ruling that the DNR didn’t have all the information required by state law.On May 24, former DNR Secretary Dan Meyer, who was appointed by Gov. Scott Walker, agreed to Meteor’s request to review the judge’s decision.The company also challenged Defort’s ruling in court, but a Monroe County judge put that case on hold pending the DNR review. Clean Wisconsin and the Ho-Chunk sued, claiming the agency did not have the authority to review itself, but a Monroe County judge dismissed that case.
Pipeline closure will force southern Utah company to flare its natural gas, costing it revenue and polluting the air - Across Utah, many oil wells produce natural gas that can’t get to market because the infrastructure is not in place to gather it. This so-called “residue” gas is often flared or vented into the atmosphere, thus wasting a valuable resource, erasing tax revenue for rural areas and polluting the air.To curtail such waste, Fidelity Exploration and Production Co. laid miles of pipe across Big Flat, a recreation hot spot outside Utah’s Dead Horse Point State Park in 2014, and built the Blue Hills gas processing plant near the Canyonlands Field airport. The project cost the company up to $70 million and left an extensive industrial footprint on public lands used for mountain biking and camping. At least the flaring stopped at the many wellheads, now operated by Fidelity’s successor, Kirkwood Oil & Gas, in Grand County’s most productive oil field.But now the flaring is expected to resume after the Utah Public Service Commission lost patience with the company that operates a connected transmission pipeline. Pacific Energy and Mining Co. has been fined $100,000 and ordered to shut down its Paradox pipeline, the 16-inch-diameter steel tube that connects Kirkwood’s gas plant with the interstate Northwest pipeline 14 miles away, because of the Reno, Nev.-based firm’s persistent failure to comply with various safety and training standards.In response, Kirkwood officers say they will seek emergency permission from the Utah Division of Oil, Gas and Mining, or DOGM, to flare the company’s natural gas production, estimated at 750,000 cubic feet per day, worth about $2,000 at today’s volatile but depressed gas prices. The company said some of the 30 wells served by that pipeline cannot be shut in without risking damage.“The wells might not come back to their earlier level of production,” said Kirkwood official Steve Degenfelder.In its filings with the PSC, Pacific denies its pipeline is out of compliance, arguing the agency’s inspectors were not qualified and blamed the need for flaring on regulators. Company officials downplayed the alleged violations, saying the regulations at issue have little to do with safety and more to do with record-keeping.DOGM Director John Baza said his agency will look for ways to minimize the waste resulting from the closure of Pacific’s pipeline, but public safety and the integrity of Kirkwood’s oil wells take precedence.
Groups Warn Against Trump Effort to Unleash 'Fracking Frenzy' by Unlocking Million+ Acres of Public Land for Drilling - Over 1 million acres of California land will be opened to fracking if Donald Trump has his way according to a plan released just hours after his administration shelved efforts to expand offshore drilling. The president announced the plans in a draft released by the administration on Thursday afternoon. The proposal calls for opening 1,011,470 acres of public holdings in California to oil drilling and fracking. The new proposal comes on the same day as the administration pulled out of a controversial plan to expand offshore drilling was thrown out by a federal judge in Alaska. In a statement, Natural Resources Defense Council legislative director for the Nature Program Alexandra Adams said that the program should be completely ended. "President Trump's wildly unpopular and risky offshore drilling plan needs to be more than sidelined," said Adams. "It should be deep-sixed permanently." Yet the California rule proposal is the kind of decision that could have disastrous effects on the environment, said Clare Lakewood, senior attorney for the Center for Biological Diversity. "Trump's plan would unleash a fracking frenzy that puts California's people and wildlife in harm's way," said Lakewood. "This administration is dead set on letting oil and gas companies dig up every last drop of dirty fuel." The decision, if it goes through, would be the first time in six years that the Bureau of Land Management (BLM) issues a land lease since a judge ruled the agency's issuance of fracking certificates violated the National Environmental Policy Act. "Californians don't want fracking on our beautiful public lands any more than President Trump wants fracking on the greens of his Mar-a-Lago golf course," said Earthjustice attorney Greg Loarie. "There's no place for this backwards plan in California's clean energy future."
The Slow Death Of Californian Oil & Gas --Entrepreneurs in California were pioneers of the American oil industry in the 19th and the beginning of the 20th century. That, however, has changed due to declining production. Since its peak in 1985, production has plunged almost 60 percent to 460,000 barrels per day. Next to this, the Golden State’s oil reserves have declined 25 percent to 2.2 billion barrels. This reversal doesn't only impact the state’s economic situation, but also its position towards foreign producers who are increasingly required to supply the necessary oil. California’s demise as an essential producer of hydrocarbons is especially staggering due to the transformation of the American fossil fuel industry. The shale revolution has propelled the North American country into becoming one of the world's largest producers of fossil fuels. U.S. crude oil production has soared to record heights, rising 140 percent in a couple of years to 12.1 million bpd. North Dakota has become the second oil producing state in the U.S. due to the shale revolution. Fracking technology has unlocked previously unreachable resources which have doubled U.S. oil reserves to 45 billion barrels. Ironically, California is the second biggest consumer of oil in the U.S. after Texas. Approximately, 40 million gallons of gasoline, 8 million gallons of diesel, and 20 percent of the country’s jet fuel are consumed in the Golden State each day. Notably after Alaska’s production decreased significantly over the years, California has become more dependent on Middle Eastern oil due to stringent environmental rules. The Low Carbon Fuel Standard (LCFS) has hampered the prospect of using heavier crude which is produced locally and in Canada. Instead, lighter oil that is supplied by OPEC’s member states, for example, makes up for 37 percent of California’s oil imports. The state’s predominantly Democratic electorate and leadership generally opposes pipelines that could pump high-quality, lower cost shale oil from other U.S. states. California does hold some promising shale formations in its central and southern parts which could hold at least 20 billion barrels of recoverable oil and gas. Current Governor Gavin Newsom, however, is not supportive of the shale industry.
Judge fines pipeline company $3.3 million for 2015 Santa Barbara oil spill – On April 25, Santa Barbara Superior Court Judge James Herman Plains sentenced Plains All American Pipeline, L.P. to pay $3,347,650 in total fines and penalty assessments for the massive 2015 Refugio Oil Spill in Santa Barbara County that killed marine mammals, protected sea birds, and other marine life and temporarily closing fishing and other recreation along the pristine coast. Santa Barbara County District Attorney Joyce E. Dudley and environmental groups were disappointed that the Judge did not grant the DA’s request to impose a larger fine of $1.2 billion on the company. “While the Court made findings including that Plains knew or should have known their pipeline would rupture, stating that ‘[i]t was not a matter of if, but a matter of when,’ Judge Herman denied the People’s request to impose probation and for a significantly larger fine,” according to a statement from the DA’s Office. The Court retained jurisdiction over restitution for victims, and the next hearing on that issue will be held on July 10, 2019. Missing from the press releases from the Santa Barbara County DA’s Office, Attorney General’s Office and environmental groups and the superficial press coverage of the spill, the investigation, the jury trial and sentencing is one of the biggest and most ironic stories regarding the Refugio Oil Spill. In a classic example of the deep regulatory capture that pervades what passes for “marine protection” in California, the head of the oil industry trade association, the Western States Petroleum Association (WSPA), that lobbies for the Plains All American Pipeline corporation happens to be the very same “marine guardian” who chaired the panel that created the so-called "marine protected areas" that were fouled by the spill.
State slaps company with $15 million fine for orphaned gas wells - Environmental regulators are trying to scrape together enough money to plug a portion of 40 orphaned natural gas wells in northwest South Dakota after assessing a $15.494 million penalty — with dubious prospects for payment — against the former operator of the wells. The wells were drilled beginning in 2006 in the Buffalo area by Spyglass Cedar Creek, a company in Houston, Texas, that initially boasted of $22 million in financing. But the wells eventually fell idle as the company’s prospects disintegrated under the strain of falling natural gas prices, a lender’s bankruptcy, at least four lawsuits, and a tax-fraud indictment against a business partner. After several years of hoping the company would right itself and put the wells back into production, the South Dakota Board of Minerals and Environment revoked the company’s permits in January. Because someone associated with Spyglass cashed out a $20,000 bond without the knowledge of state regulators in 2015, the only money now available to plug the orphaned wells is a separate bond for $9,850 also posted by the company. The state Department of Environment and Natural Resources has estimated that the total cost to plug the wells will be $887,700. At a March 21 meeting in Pierre, the Board of Minerals and Environment, a nine-member citizen panel appointed by the governor, imposed a maximum civil penalty of $500 per well, per day on Spyglass for violations of state regulations related to the condition of the wells. The total penalty is $15.494 million. Extracting any money from Spyglass could prove challenging, based on past indications. Earlier this year, for example, the company failed to stave off the revocation of its permits when it was unable to post a $200,000 cash or surety bond requested by the Board of Minerals and Environment.
ONEOK to construct $100 million pipeline in North Dakota - ONEOK on Thursday announced plans to invest nearly $100 million to construct a 75-mile natural gas liquids pipeline lateral on the northern portion of its Bakken NGL pipeline. The project will connect its Bakken NGL pipeline with a third-party natural gas processing plant in eastern Williams County, North Dakota, officials said. The lateral is expected to be complete in the fourth quarter of 2020 and is supported by long-term natural gas liquids production, including a minimum volume commitment. It is expected to provide NGLs to ONEOK’s Elk Creek Pipeline. The lateral will provide access to the raw feed NGL pipeline in an area with historically limited transportation options. The pipeline will also provide connectivity with key NGL market centers.
The Latest: North Dakota promises suit over oil train rules (AP) — North Dakota intends to sue Washington if that state’s governor signs legislation requiring oil shipped by rail to have more of its volatile gases removed.Proponents of the bill say it would boost safety. The volatility of oil trains drew widespread public attention following several explosive derailments, including one in 2013 in Quebec that killed 47 people.North Dakota officials worry the bill could hamper the nation’s No. 2 oil producer. About one-tenth of North Dakota’s daily oil production is shipped to Pacific Northwest refineries.North Dakota’s Industrial Commission believes the bill is an unconstitutional violation of interstate commerce law. The regulatory group is comprised of the governor, attorney general and agricultural commissioner. Washington Gov. Jay Inslee is still reviewing the bill but indicated to The Associated Press that he’s likely to sign it.
Exxon agrees to $1 million penalty for Montana oil spill — Exxon Mobil Corp. agreed to pay a $1.05 million penalty to settle alleged federal water pollution violations from an oil pipeline break into Montana’s Yellowstone River, according to court documents filed Friday. Approval of the agreement by U.S. District Judge Susan Watters would resolve the last outstanding federal enforcement case against the oil giant stemming from the 2011 accident that spilled 63,000 gallons (238,474 liters) of crude. Terms of the settlement were detailed in a consent decree filed in federal court in Billings. It’s subject to a 30-day public comment period. The spill near the town of Laurel, about 15 miles (24 kilometers) west of Billings, came after flooding along the Yellowstone scoured the river bottom and exposed the buried pipeline, causing it to break and release crude directly into the waterway. The accident occurred downstream of Yellowstone National Park along a stretch of river popular among fishers, boaters and other recreational users. About 140 people were temporarily evacuated because of health and safety concerns. Exxon previously paid $12 million in natural resource damage compensation and $2.6 million for pipeline safety and state pollution violations. The Irving, Texas-based company also spent an estimated $135 million on a months-long cleanup and repairs. The latest penalty stems from violations of the Clean Water Act. Oil swept downstream by the raging river entered tributaries and nearby wetlands and fouled more than 14 square miles (36 square kilometers) of riverfront, according to court documents. Exxon spokesman Jeremy Eikenberry said the settlement “provides for an acceptable outcome that avoids protracted litigation between the parties.” The company on Friday reported earnings of $2.35 billion during the first quarter of 2019, down by roughly half from the same period a year earlier. The 12-inch (30-centimeter) Silvertip pipeline had been installed just a few feet beneath the riverbed, sparking a national discussion over the adequacy of safety rules for thousands of pipelines crossing beneath waterways.
Not so fast: Trump's Alaska drilling study slammed by U.S. wildlife regulator - (Reuters) - The Trump administration failed to adequately consider oil spills, climate change and the welfare of polar bears in its expedited study of proposed drilling in Alaska’s Arctic National Wildlife Refuge, according to comments published by the U.S. Fish and Wildlife Service this week. The unusually harsh criticism from federal wildlife regulators could deal a blow to one of the most high-profile items in President Donald Trump’s energy agenda, and reflects the pitfalls of the administration’s drive to speed up big projects with quicker, shorter environmental studies. The Interior Department wants to hold its first lease sale of at least 400,000 acres in ANWR, America’s largest wildlife sanctuary, later this year, but could face lawsuits if its permitting process is flawed. The Fish & Wildlife Service said the ANWR Coastal Plain draft environmental impact study (EIS) failed to include oil spill response plans, analyze the effects of climate change on the Arctic, or ensure that surveys of polar bear denning habitats are required. The Interior subagency also listed dozens of other information gaps in its 59 pages of comments and implied that the Interior Department’s Bureau of Land Management wrote the study without properly consulting wildlife regulators. “The Service has managed the Arctic National Wildlife Refuge and its resources for several decades and has information and expertise that is valuable in formulating a final EIS that can withstand the scrutiny of legal sufficiency,” the agency’s Alaska director Gregory Sikanie wrote. The Fish & Wildlife Service declined to provide further comment. The Interior Department said its Bureau of Land Management had received thousands of comments on the draft study, all of which would be considered. “BLM has an obligation to consider all of these comments -including those from its sister agency (Fish & Wildlife) - and anticipates they will inform the Final EIS inmultiple ways,” spokeswoman Molly Block said in an email.
Grounded barge leaks oil on Kodiak Island - A long-derelict barge near the U.S. Coast Guard base on Kodiak Island may be leaking petroleum, and the USCG has contracted with Global Diving and Salvage to conduct an assessment and abatement process.The barge has been resting on the shore in Womens Bay, Kodiak Island for several years. On Thursday, the Coast Guard received a report of a possible petroleum leak near the barge. Pollution investigators documented a 300-yard long by one-yard wide rainbow-colored sheen coming from the vicinity of the barge, and containment boom has been placed around the site to minimize its spread. The Coast Guard opened the Oil Spill Liability Trust Fund for $150,000 to help address the pollution, and contractors were scheduled to begin pumping product off the barge on Saturday afternoon. The maximum potential for fuel and oily waste remaining on the barge is unknown, and the barge's owner has not been identified. "Our job is to ensure the potential for pollution in this situation is mitigated," said Coast Guard Chief Petty Officer Emily Clore. "The sheening so far is relatively light, and seems to be discharging intermittently, at a slow rate. But protecting the pristine maritime environment surrounding Kodiak Island is our top priority here."
Canadian Oil Driller Abruptly Shuts Down, Abandons 4,700 Wells - A junior Canadian gas E&P company has shut down abruptly, leaving as many as 4,700 wells behind, CBC reports, quoting the Alberta Energy Regulator, which said it had sent Trident Exploration Corp. an order to manage its wells, to which the company did not respond.Trident closed two days ago and announced it would not be returning any money to shareholders or holders of unsecured bonds, adding it had well abandonment and reclamation liabilities of US$244.78 million (C$329 million) to deal with.According to the Alberta Energy Regulator, these 4,700 wells add to more than 3,000 abandoned wells in Canada’s oil heartland that are currently awaiting remediation. The regulator also said it had been working with the company to smooth its exit from the industry and had ordered it to decommission the wells or transfer them to another company. Trident failed to comply with the order, the AER said.“Trident does not have the funds to operate its infrastructure or enter into creditor protection. As a result, they have decided to walk away, leaving more than 4,400 licensed sites, many of them active, without an operator,”the watchdog told CBC.Data from the Alberta Energy Regulatorsaysthere are some 170,000 abandoned wells in the province, most of these sealed and taken out of service or reclaimed. The number represents more than a third of the total well count in Alberta, with the watchdog noting in its overview on the topic that even their abandonment, the wells remain the responsibility of the company that owns them. Two years ago, think tank C. D. HowewarnedAlberta was facing a well cleanup and reclamation bill of US$5.95 billion (C$8 billion) and needed to change the way it made companies take financial charge of the abandonment and reclamation of their wells. Since then, this figure has grown.
Diesel traders anticipate shortage, but not just yet: Kemp - (Reuters) - Gasoil traders expect the middle distillates market to stay well supplied until almost the end of 2019 before swinging into deficit with the introduction of new maritime fuel regulations.Calendar spreads for low-sulphur gasoil delivered to Europe's Amsterdam-Rotterdam-Antwerp hub are currently in contango through until October before shifting to backwardation from November onwards (https://tmsnrt.rs/2WgXabR).In futures markets, contango structures, where future contract prices are higher than front-month prices, are associated with expectations of adequate or rising inventories. The reverse structure of backwardation tends to indicate a drawdown in stocks.The current structure suggests the market will be plentifully supplied through the northern hemisphere's summer and autumn before shifting to a shortage with the onset of winter and introduction from Jan. 1 of new fuel rules by the International Maritime Organization (IMO). In most cases, the new rules will force shipowners to switch from burning high-sulphur residual fuel oil to low-sulphur distillate-type fuels. If they don't change fuel, they must install exhaust-gas cleaning systems commonly called scrubbers.Refinery crude processing is expected to reach record rates in the third quarter, especially in the United States, as refiners try to rebuild depleted gasoline stocks, which will swell gasoil stocks as a by-product.But as refiners cut back on crude processing and gasoline production in the autumn, distillate markets are expected to tighten with winter heating demand and the entry into force of IMO bunkering rules.As a result, spreads for the fourth quarter of 2019 and the first half of 2020 have been marching steadily towards or deeper into backwardation, while the spread for June-September 2019 has stayed in contango (https://tmsnrt.rs/2XV1i1E). The market dynamics are consistent with reports that physical traders have started putting excess gasoil and other middle distillates, such as heating oil and road diesel, into storage in anticipation shortages later in 2019. Contango structures help offset some, or all, of the cost of storing and financing distillate stocks in the next few months before the barrels are sold at the end of the year or in 2020, potentially at a higher price. Recent reports have suggested traders are chartering vessels to act as floating storage near gasoil delivery hubs or key bunkering ports, and filling them with gasoil and other middle distillates. Extra distillate inventories accumulated during 2019 should help ameliorate shortages in 2020 and ease the transition to the new bunkering regulations. Before then, the gasoil market is set to remain in surplus through the third quarter, which likely explains why most hedge funds are maintaining a relatively neutral position on near-term distillate prices. The bottom line is that traders expect the distillate market to tighten, but not until the U.S. summer driving season is over and the IMO regulations get much closer.
U.S. Pricing Dominates Physical Natural Gas Market Transactions in Mexico, MGPI Survey Says - The first survey of buyers and sellers of natural gas in Mexico conducted by NGI's Mexico GPI shows that U.S. price indexes are involved in the majority of transactions in Mexico.The survey received 29 responses from natural gas buyers and sellers in Mexico, one short of the 30-sample size generally considered by statistical theory as needed to approach the population mean, and so a fairly good measure of current realities in the market.There was also ample representation of both buyers and sellers in the survey. Ten respondents were marketers, eight represented industrial end-users in Mexico, and five were gas producers.Respondents said on average 34% of the gas they buy or sell within Mexico and/or at the U.S.-Mexico border is based on a differential to a U.S. index.Meanwhile, 23% of natural gas transactions within Mexico and/or at the U.S.-Mexico border were tied to the Petróleos Mexicanos (Pemex) First Hand Sales pricing mechanism (VPM), which is derived from various Texas indexes.
Britain's LNG Flows Hit a Record -- Britain’s appetite for natural gas usually declines in the summer, but this season is different with a record number of LNG tankers due to land this month. The incoming cargoes show no sign of slowing, and will keep the pressure on benchmark prices already trading below their five-year seasonal average. That’s good news for factories and households as Brexit clouds the nation’s economic outlook. “We can expect a significant pressure on prices this summer,” said Murray Douglas, a research director for European gas at Wood Mackenzie Ltd. “The global LNG market is strong, we will still have a lots of LNG turning from the Asian to the European markets and we still see lots of LNG deals” and approvals for new projects. Cargoes are heading to the U.K. and other northwest European nations because thanks to the extensive infrastructure and traded hubs they can absorb any global surplus as well as handle a growing worldwide production boom. Britain is still taking imports of the super-chilled commodity even after its gas export pipeline shut for repairs this month. LNG prices in Asia, the biggest consumer of the fuel, have also been too low to spur traders to ship cargoes east. Cooler weather is also supporting demand in the U.K. While Asian LNG spot prices have regained their traditional premium over European hubs, Atlantic basin suppliers such as the U.S. and west Africa are still sending most of their cargoes to Europe, their nearest liquid market. Longer term, more plants are due to start producing LNG and a number of projects from Mozambique to Russia are nearing investment decisions this year. U.S. President Donald Trump may use Europe’s increased appetite for LNG to promote his country’s fuel in the region when he visits the U.K. in June, according to Leslie Palti-Guzman, president and founder of consultant GasVista LLC in New York. In addition, the European Union and the U.S. will hold a forum in Brussels on May 2 to discuss bringing natural gas originated from shale fields in the U.S. to nations from Germany to Greece. U.K. shipments are mainly sourced from the biggest exporter Qatar, as well as countries such as Nigeria and Norway, but the U.S. is becoming a bigger supplier. Britain is now among the top-10 importers of American LNG this year. “This surge in U.K.-U.S. trade flow will bode well with the June visit of President Trump to the U.K., who has repeatedly used U.S. LNG as a tool in trade negotiations,” Palti-Guzman said by email. “The U.K. will be able to trumpet the increase in U.S. LNG imports to reinforce its trade relationship with the U.S., especially post-Brexit.”
Fracking tsar quits after six months and blames eco activists - The government’s fracking tsar has quit the post after just six months, claiming policy relating to the controversial process means there is “no purpose” to her job.Natascha Engel told the business secretary, Greg Clark, that developing the industry would be “an impossible task” despite its “enormous potential”. In her resignation letter, she said environmental activists had been “highly successful” in encouraging the government to curb fracking.Engel, a former Labour MP, wrote the letter following two weeks of protests by the Extinction Rebellion group, which brought parts of London to a standstill with demands to cut emissions to zero by 2025.She wrote: “A perfectly viable and exciting new industry that could help meet our carbon reduction targets, make us energy secure and provide jobs in parts of the country that really need them is in danger of withering on the vine – not for any technical or safety reasons, but because of a political decision.” Engel complained that a traffic light system that halts fracking when a tremor with a magnitude of 0.5 is recorded “amounts to a de facto ban”. “The UK could be on the cusp of an energy revolution the like of which we have not seen since the discovery of North Sea oil and gas,” she wrote. Engel’s resignation letter said: “The UK is currently spending £7bn a year on importing gas – money that is not being used to build schools, hospitals or fix the potholes in our roads. Developing our own shale gas industry would mean money going into the Treasury rather than out.”
Government's fracking tsar quits after six months and accuses ministers of caving in to the 'small but loud' group of eco warriors led by Greta Thunberg - Britain's fracking tsar has quit after just six months – saying developing the industry had become an impossible task.Natascha Engel claims the Government has caved in to the powerful environmental lobby, meaning there is 'no purpose' to her job.She told her boss, Business Secretary Greg Clark, that the shale gas industry has 'enormous potential'. But in her resignation letter, she said eco activists had been 'highly successful' in encouraging ministers to curb fracking – which she said can create jobs and provide a cleaner alternative to coal and biomass.She has also accused ministers of listening more to environmental campaigners such as 16-year-old Swedish schoolgirl Greta Thunberg than to those involved in the fracking industry.Last night Miss Engel told The Sun: 'It's fine listening to people like Greta and the Extinction Rebellion but they don't have any answers.'The Government are paying more attention to them than the very people wanting to invest and develop new energy reserves or even local communities.'Miss Engel, 52, resigned following two weeks of protests by Extinction Rebellion which brought parts of London to a standstill. The group is demanding that carbon emissions are cut to zero by 2025. But the former Labour MP argued that ending fracking will cause higher, not lower, greenhouse gas emissions because Britain will be more reliant on imported gas.
UK Fracking Commissioner Admits to Deleting Correspondence With Industry --The British government's recently-departed shale gas commissioner admitted to routinely deleting correspondence and throwing away notes from meetings with fracking companies in a move that may have violated transparency requirements. In response to an Unearthed freedom of information request sent earlier this year, Natascha Engel — who resigned this weekend after just 6 months in the role — said: "I tend to deal with everything on the day and delete what has been done to avoid any huge build-ups or risk of duplication. "The same is true of the few notes I take in meetings which I review in the evenings, action and throw away." The failure to take notes and systematic destruction of information in this manner could be in breach of the Environmental Information Regulations 2004 (EIR). The original request was for all email communications with the UK's two leading fracking firms: INEOS – for which Engel has previously done paid work — and the Lancashire-based operator Cuadrilla. Unearthed initially wrote to the Department for Business, Energy and Industrial Strategy (BEIS), which employs Engel for a fee of £500 a day, for the information but were told to apply directly to Engel herself who was described as "separate from BEIS." Following Engel's response, Unearthed has requested an internal review of the handling of the request. However, it is not clear if the review will continue to be processed following Engel's exit and, if so, who will conduct it, as Engel carried out the initial response and guidance from the Information Commissioner's Office states that review of this nature should be "carried out by someone senior to the person who dealt with the original request" or, if that is not possible, "someone trained in, and who understands, the Environmental Information Regulations." Though Engel did provide a handful of emails in response to the request, there were no communications covering Oct. 5, when she first entered the role, and Dec. 30.
Greenpeace activists climb aboard oil rig in Norwegian Arctic - Greenpeace activists on Monday climbed on board the West Hercules oil rig, owned by deepwater drilling company Seadrill, in the Norwegian Arctic to protest against new oil drilling. Four climbers had ascended the oil rig, four people were at the base in kayaks and others were protesting from the shore holding banners saying "ban new oil" and "people versus oil." "We in Greenpeace, together with another youth NGO, Nature and Youth, are here to protest against new oil drilling, especially from oil fields in the Arctic, which is a vulnerable area," Greenpeace Norway's Communications Manager Aud Hegli Nordo told DW. The activists hailed from Norway, Sweden, Denmark and Germany. The West Hercules oil rig is currently anchored off the Norwegian town Hammerfest, continental Europe's northernmost town, and has been commissioned by Norwegian multinational energy giant Equinor to drill at the site of its liquefied natural gas plant, Snoehvit. But the oil rig is due to drill oil from the Korpfjell Deep well in the Barents Sea after receiving permission from the Petroleum Safety Authority earlier this year. It is the most northern license to ever be granted for drilling in Norway, Nordo told DW. "We have found more oil and gas in the world than we can afford to burn if we are to reach our climate goals, so going and exploring for new oil and gas does not make sense," she added. German Greenpeace activist Laura Breitkreutz attended the demonstration on Monday and said she was protesting to save the planet for future generations. "[According to] the latest climate catastrophe report published in October [by the UN Intergovernmental Panel on Climate Change] we only have 11 years left to become as carbon neutral as possible to prevent climate change getting worse," Breitkreutz said.
Trump's Unrealistic Rhetoric on US LNG Exports to Baltic States - Europe appears keen to reduce its reliance on Russian natural gas imports. Alongside Poland, those making the loudest noises are the Baltic states of Estonia, Latvia and Lithuania. All three are current NATO and European Union members, but were once part of the erstwhile Soviet Union. Their energy dependency on Russian gas imports – a hangover from a bygone era and geographical proximity – didn’t enter political discourse until recently, when in 2014 Russia annexed Crimea from Ukraine, and spooked much of the old continent. If that was a wake-up call, the Lithuanians in particular smelt the coffee. Their Klaipeda LNG import terminal was conceived to serve not just Lithuania, but Estonia and Latvia too. By June 2017, Lithuanian state-owned trader Lietuvos Duju Tiekimas inked a deal with a unit of Cheniere Energy, for its first direct import of LNG from the U.S. On August 21, 2017, history was made when an LNG tanker from Sabine Pass, U.S. docked at Klaipeda. At no point was the U.S. government involved in the deal; but tell that to President Donald Trump. Quick to jump in on news of the shipment, and that of an earlier dispatch of U.S. LNG to Polish state-owned trader PGNiG, the President expressed hope for “many more shipments” of natural gas “as we have plenty of it.” Lithuanian Energy Minister Zygimantas Vaiciunas said: “We are happy to reach a point where importing gas from U.S. is not only politically desirable but also commercially viable.” The latter point is debatable as cargoes from the U.S. have ebbed and flowed since. However, if you thought political hot air had subsided and that Trump’s attention span for any given issue is usually a short one, then think again.
Russia to restore oil pipeline supplies to Europe in two weeks - (Reuters) - Russia plans to restore oil supplies via its key Druzhba pipeline to Europe in two weeks, after joint talks with Belarus, Ukraine and Poland on Friday in Minsk. Poland, Germany, Ukraine and other countries suspended imports of Russian oil via the pipeline this week due to contamination. Halting those supplies has knock-on effects further along the network. After joint talks in the Belarus capital on Friday, Russia’s Deputy Prime Minister Dmitry Kozak said in a statement that the four countries had agreed on joint measures to eliminate the effects of the contamination. “This would allow us, as earlier planned, to supply... (clean) oil to the border with Belarus by April 29 and to restore the pipeline (to stability) in two weeks,” Kozak said in the statement on Friday. Pavel Sorokin, Russia’s deputy energy minister, told reporters in Minsk after the talks that one of the options for supplying clean oil was to mix the contaminated product with regular supply. Russia’s pipeline monopoly Transneft said on Friday that the contamination which led to the suspension of the oil flows to Europe could be deliberate, Interfax news agency reported. The problem arose last week when an unidentified Russian producer contaminated oil with high levels of organic chloride, which is typically used to boost oil output but which must be separated before shipment as it can destroy refining equipment.
Clean Russian oil has reached Belarus via key pipeline, Moscow says (Reuters) - Clean Russian oil had reached the border with Belarus by midday on Monday, a Russian official said, five days after European refineries suspended imports because of contamination in the Druzhba pipeline. Poland, Germany, Ukraine, Slovakia and other countries on the network suspended oil imports via the Druzhba pipeline after finding contaminants that can damage refinery equipment. “As planned, at 1200 (0900 GMT) on April 29 oil ... has reached ... the Druzhba pipeline’s Unecha border station,” Ilya Dzhus, spokesman for Deputy Prime Minister Dmitry Kozak, said in a statement. Belarus had earlier said that clean Russian oil had yet to reach its borders via the pipeline — a major source of oil supply across Europe — after tainted crude prompted several importers to halt flows last week. State-run oil company Belneftekhim said that Belarusian refineries were still running at reduced capacity, though Moscow had said it would start pumping clean crude through the Druzhba network from Monday. Negotiations with Moscow over Belneftekhim’s oil supply will continue, one of its deputy chairmen, Vladimir Sizov, told Reuters as he left talks at the Russian Energy Ministry on Monday..
How Russia contaminated $2.7 billion of oil exports to Europe (Reuters) - The letter was from the state pipeline company in Belarus, Gomeltransneft, telling oil refiners and pipeline operators in Poland, Ukraine, Hungary, Slovakia and the Czech Republic that the crude heading toward them from Russia down the 5,500 km (3,400 mile) Druzhba pipeline network was heavily contaminated. For the next 10 days, refiners and oil firms in Europe cut purchases of Russian oil by up to a million barrels a day - or 10 percent of European oil imports - in a major disruption to supply from the world’s second largest oil exporter. The disruption sent oil to a six-month high above $75 a barrel, tarnished Russia’s reputation as an exporter at a time of rising competition with U.S. oil sales and triggered a Russian probe into whether the pipeline had been sabotaged. As the crisis entered its 11th day on Tuesday, oil buyers had yet to hear directly from Russian pipeline monopoly Transneft, the owner of the network that exported the tainted oil, 10 sources at Western oil firms and trading houses said. The oil was contaminated with organic chlorides, compounds used in the industry to boost extraction from oilfields by cleaning oil wells and accelerating the flow of crude. The compounds must be removed before oil enters pipelines as they can destroy refining equipment or, at high temperatures, create the poisonous gas chlorine. Tests by Belarus on oil from Druzhba showed organic chloride levels of 150-330 parts per million (ppm) between April 19 and 22, according to Gomeltransneft documents seen by Reuters, well above the maximum 10 ppm allowed by Transneft. Contaminated oil has been found in Belarus, Poland, Germany, Ukraine and the Baltic port of Ust Luga, all of which are served by the Druzhba network, said multiple sources involved in trading Russian oil said. “This oil is not sellable. You cannot just dump the price and sell it at a discount. No one wants this oil,” a second source at a Western oil company said. “This will take months and Russian exports and even production may have to fall,” said Sen at Energy Aspects, adding that European countries might have to tap strategic oil stocks if the outage lasts longer. Last week, the world’s biggest oil trader, Vitol, refused to take a cargo from Ust Luga saying it was contaminated, forcing the port to shut down for 24 hours, according to several sources at Western oil companies and trading houses. For now, there is no explanation as to how the oil was tainted. The scale of the contamination suggests corrupted crude could have been pumped into the pipeline for days, if not weeks. Belarus said on Tuesday that the volume of contaminated crude could be as high as 5 million tonnes - equivalent to a month’s exports via Druzhba of about 1.2 million barrels a day and worth $2.7 billion at current prices. In a news briefing on Friday, Igor Dyomin, an aide to Transneft’s Tokarev, told Russian media “the contamination was intentional”. He did not name the producers and said investigators were searching several private companies in the Samara region. Putin said the crisis had caused very serious economic, material and reputational damage. Putin said on Saturday that law enforcement agencies could step in if Transneft’s internal investigation failed to provide enough answers.
The Logistical Nightmare of Cleaning Up Russia’s Tainted Oil - How do you get millions of barrels of dirty Russian oil out of the pipelines? Eastern European nations are working on an unprecedented logistical operation to do just that. Russian crude flows to Europe are said to have been suffering from high levels of organic chloride since at least April 21. About 30 million barrels -- enough to fill 15 supertankers -- could have been contaminated, according to Energy Aspects analyst Christopher Haines. The range of solutions involved will include drip feeding the tainted barrels into clean crude supplies in order to dilute down the contaminant and deploying thousands of railcars to move the crude to other locations in Russia. In addition to the release of strategic oil reserves, crudes will probably be pulled from other parts of the world in order to keep refineries running. “This is a huge logistical issue,” Haines said by phone from London. “It is on the biggest oil pipeline that comes into Europe. There could be anywhere between 20 and 50 million barrels of this crude, we’re estimating it’s probably around 30 million.” While the impact of the disruption has so far been largely unfelt in crude futures markets, governments in Poland and Hungary released strategic oil reserves to keep their refineries going. Some of the contaminated crude is thought to contain up to several hundred parts per million of organic chloride -- an element that’s corrosive and can damage both pipelines and refinery units. Transneft, which operates the Druzhba pipeline, has a limit of ten parts per million, while a normal value would be between one and three parts per million, Haines said. One thread of the twin pipeline will be freed up by moving about 400,000 tons of substandard crude to farms in Hungary, Slovakia and Ukraine, in an effort to resume oil flows. That should mean clean oil can reach European Union countries by May 18, Ukraine’s national pipe operator said. At the same time, Russian Railways is helping take some of the oil out of Belarus by train. Despite the attempt to use rail capacity, there aren’t enough carriages to take sufficient oil away from the pipeline, according to Dora Polgar, senior analyst at Facts Global Energy, adding that the pipeline may have to be reversed in order to clear some of the flows. “Railway takeaway capacity is limited,” she said. “We are talking about all of Druzhba and the pipeline that goes to Ust-Luga, and they don’t have the equivalent capacity, not even close to it, with railway.” More immediately, the governments of Russia’s customers have been releasing emergency reserves. The International Energy Agency said on Tuesday that Poland is using inventories to maintain normal operations at two refineries. At the same time, Hungary has released 400,000 tons, or 60 percent of its stockpiles, to compensate for supplies halted due to contamination.
Oil spill threatens to pollute water sources in Makueni - The Kenya Pipeline Company (KPC) has started cleaning up an unknown amount of diesel in Makueni County which spilled from a punctured section of the new Sh48 billion Mombasa-Nairobi oil pipeline. It is not clear for how long the new pipeline had been leaking before the spillage was detected three weeks ago. The affected area is tucked in a forested area at the source of the seasonal River Kiboko. “We did not expect a leak on this pipeline since it is only one year old. This was an accident. We suspect that the punctured spot was weakened by a boulder dropped by an excavator during the laying of the pipeline,” acting KPC managing director Hudson Andambi said on Monday. KPC technicians have since repaired the pipeline but multiple trenches sunk around the affected area show that the underground water in the area has been contaminated with oil, to the chagrin of local water users and environmentalists. “Be assured that no more oil will percolate because we have sealed the pipeline. We have embarked on establishing the extent of the leakage and that is why we have sunk the inspection trenches. A contractor will soon come over to map the extent of the oil spillage and the concentration of the oil in the soil and the water sources using specialised technology. We shall then remove all the contaminated soil to Makindu pump station because we don’t want it to remain there to continue causing more trouble,” said Mr Andambi.
Warp factor: Asia's LNG markets distorted by oil price surge - The price gap between LNG traded in the spot market and term cargoes linked to benchmark Brent crude oil has stretched to its widest in about 8 years, driving some buyers locked in to term deals to try to delay shipments or look to adjust contracts. That comes as record supplies of LNG keep spot prices low, while prices under term contracts rise in tandem with oil. Brent hit highs so far for 2019 after Washington stepped up sanctions on Tehran and as the Organization of the Petroleum Exporting Countries (OPEC) continued to withhold crude supply to bolster markets.[O/R] “Anyone buying on a Brent basis and selling on a (spot) basis, for example, is losing money in a big way,” said Jason Feer, global head of business intelligence at Poten & Partners, an LNG tanker brokerage and consultancy. Brent-indexed LNG costs around $10.50 per million British thermal units (mmBtu) at the moment, while the spot price is just above $5 per mmBtu. Measured by a single cargo on a large LNG tanker, an oil-linked delivery currently costs as much as $120 million, while the same product delivered into the spot market could be available for around $60 million. “(The wide price spread) is a good example of the risks that are emerging as the LNG market becomes more globalized and commoditized,” Feer said, adding that pricing had become increasingly diversified. Oil-linked term cargoes make up around two-thirds of supply in Asia, the world’s top LNG-consuming region. Long-term LNG contracts are typically linked to oil prices as there are no uniform global prices for gas.
Saudi Aramco Sees Shale Gas As Kingdom's Next Energy Bonanza -- - The world’s biggest oil exporter is ramping up efforts to develop natural gas with plans for a 15-fold boost in output from unconventional deposits of the fuel. Saudi Aramco is building facilities to tap shale gas in the kingdom’s oil-rich eastern region and is making “a lot of progress” toward this goal, Chief Executive Officer Amin Nasser told reporters in Dammam, Saudi Arabia. Plans include a plant to desalinate seawater that Aramco can then inject underground to frack for gas. “We are looking to take our unconventional gas within the next 10 years to 3 billion standard cubic feet a day of sales gas,” Nasser said on Sunday. Aramco currently produces more than 190 million cubic feet of unconventional gas daily, all of it in the remote north. Known officially as Saudi Arabian Oil Co., the state-run company is expanding its search for gas as a potential export to help reduce the nation’s reliance on sales of crude. Saudi Arabia also wants to use gas at home as fuel in power stations and as feedstock for the production of petrochemicals, a high-priority industry for the government in its strategy to diversify the economy. Earlier attempts to find and develop Saudi gas, together with international partners including Exxon Mobil Corp. and Royal Dutch Shell Plc, met with lackluster results. Now, with improved technology, Aramco is seeking unconventional gas at the South Ghawar and Jafurah deposits in eastern Saudi Arabia, Nasser said. It plans, for example, to build a reverse-osmosis desalination plant to treat Persian Gulf seawater for injection into the Jafurah basin to dislodge shale gas. Jafurah is located between Ghawar, the world’s largest oil field, and the Gulf, near the hub of the Saudi energy industry. The water-treatment facility is in the planning and design phase and could be in operation in four to five years, Mohammed Al Qahtani, Aramco’s senior vice president for upstream, told reporters in Dammam. Aramco plans to double its total gas production to 23 billion cubic feet a day over the coming decade, Nasser has said.
Massive Oil Discovery in Pakistan: Hype vs Reality – video - Prime Minister Imran Khan has recently raised Pakistanis' hopes of ExxonMobil and ENI being on the verge of a massive discovery of offshore oil and gas reserves in Pakistan. Is this real? Or mostly hype? What is the size of these reserves? Will it be more than sufficient to meet Pakistan's current needs of over 200 million barrels of oil per year? Will Pakistan become a net exporter of oil and gas like major OPEC nations? Why is it taking so long to get confirmation from the companies involved? What are the technical issues in getting confirmation of these huge reserves? Why is there such a big concern about blow-out? Is it because the 1.5 billion barrels pre-drill estimate of Kekra-1 well in block G of the Indus basin off the Karachi coast? Could such a large reserve cause a major blow-out accident like the one British Petroleum had in Gulf of Mexico near Louisiana in the United States? How long will it take to fix the blow-out preventer (BOP) and complete drilling of the remaining 600-800 meters of the total depth of over 5,500 meters deep in the Arabian Sea? Azad Labon Kay Sath host Faraz Darvesh discusses these questions with Misbah Azam and Riaz Haq (www.riazhaq.com) https://youtu.be/02oKLNPmUdk
Donald Trump’s Iran oil sanctions may severely damage India’s economy (and the world’s) --The United States has unnerved the world oil market by ramping up the pressure in its long-running dispute with Iran. It has announcedthat, after May 1, it will not renew the exemptions given to eight countries that enable them to buy Iranian oil. Those affected, including China, India, Japan, Italy and South Korea, will face sanctions from Washington if they do not comply. The move will likely squeeze global oil supply at a time when it is already struggling from disruptions inVenezuela, Libya and Nigeria. Indeed, the Brent crude price has already risen on the back of the announcement to $74 per barrel, the highest since last November.President Donald Trump has said he is confident that a supply crunch can be avoided thanks to extra output from Saudi Arabia and the United Arab Emirates, but traders and Asian petrochemical firms are sceptical that these countries will fully comply. In recent months, Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries have cut supply dramatically to redress their fears that hefty US shale oil output and declining global energy demand could cause a supply glut that would batter prices.In December the oil cartel, along with Russia and other allies, agreed toreduce output by 1.2 million barrels per day, cutting the global total volume by more than 1%. They have since exceeded those benchmarks, with Saudi Arabia alone reducing supply by 8,00,000 barrels a day. In March, the kingdom slashed production to a four-year low of 9.82 million barrels a day, making up the majority of OPEC’s reduction of 2,95,000 daily barrels for the month to 30.3 million barrels per day.No one ever forgets when the Saudis famously went against Western interests in the Arab Oil Embargo of 1973, in response to US policies with similarly global consequences: President Richard Nixon had scrapped the gold standard, heavily devaluing the US dollar, and then backed the Israelis in the Yom Kippur war against Egypt. Inflation-adjusted oil prices nearly doubled during the embargo from around $26 per barrel in 1973 to over $46 per barrel the following year, sending economic shockwaves around the world.
The US Must Not Be Allowed to Strong-Arm India-Iran Ties - The use of military power to influence hostile countries and attain foreign policy objectives is not a practical option anymore. This is especially true for powerful, developed countries like the US. Given the severe financial repercussions and weakening domestic support for such costly endeavours, the US is increasingly making a case for the use of economic sanctions as a policy tool.Economic sanctions are not new, but under the Trump administration, it seems to be the preferred alternative to deal with both friends and foes. The US Department of Treasury has an increasingly long list of individuals, corporations and countries on whom restrictions are being imposed. The measures can range from a simple set of tariffs to a full-blown economic blockade. These measures can sometimes be unfair.Last year, the US had a change of mind and decided to ignore the 2015 Iran nuclear accord that it signed with its longtime foe after much deliberation. The historic pact sealed during Obama’s tenure ensured that in exchange for lifting the crippling economic sanctions, Tehran would give up a bulk of its nuclear programme and would also submit itself to extremely invasive inspections from time to time. It was signed by the US along with other members of the UNSC, Germany and the EU. The US now wants to renegotiate the deal and has reimposed sanctions on Iran. To increase pressure on Tehran, a few days ago, secretary of state Mike Pompeo announced the cancellation of sanctions waivers. This was done to bring Iranian exports down to ‘zero’. Eight countries, including India, that were allowed to buy Iranian oil have also now been barred from doing so and will face secondary sanctions if they refuse to comply. The deadline to stop the imports from Iran is May 2. And although India has indicated acceptance, the question remains – should it comply with the US’s directive?India is the world’s third largest oil importer, and a large share of that comes from Iran (23.5 million tonnes in 2018-9). Not only is Iran India’s third largest supplier (vs just 3% of oil imports from the US), it does so on very sweet terms – with 60-day credit, free insurance, free on board (FOB) basis and a barter-of-goods arrangement.India and Iran have a deeply historical and cultural relationship, especially important in the fractious Middle East. Stopping imports will hurt. International crude prices have already jumped – oil is over $74 a barrel. As consumers, we have been lucky so far, as it has not been reflected in the domestic prices of fuel, because of the Lok Sabha elections. But chances are that after May 19, the oil marketing companies will swing into action, resulting in a spurt of petrol and diesel prices.
A New Mega Cartel Is Emerging In Oil Markets - China and India—two of the world’s largest oil importers and the biggest demand growth centers globally—are close to setting up an oil buyers’ club to have a say in the pricing and sourcing of crude oil amid OPEC’s cuts and U.S. sanctions on Iran and Venezuela, Indian outlet livemint reports, citing three officials with knowledge of the talks.This is not the first time that the two major oil importers are working to create such an oil club.India and China have discussed creating an ‘oil buyers’ club’ to be able to negotiate better prices with oil exporting countries and will be looking to import more U.S. crude oil in order to reduce OPEC’s sway, both over the global oil market and over prices, India’s Petroleum Ministry said in June 2018.“With oil producers' cartel OPEC playing havoc with prices, India discussed with China the possibility of forming an 'oil buyers club' that can negotiate better terms with sellers as well as getting more US crude oil to cut dominance of the oil block,” a tweet from the Petroleum Ministry’s Twitter account said in the middle of last year, when oil prices were rising ahead of the return of the U.S. sanctions on Iran’s oil industry.According to the officials cited by livemint, China and India have exchanged senior-level visits several times since then and have made progress on “joint sourcing of crude oil.”Reports of the strengthened Chinese-Indian cooperation in potentially forming an oil buyers’ club come just as the U.S. sanction waivers for all Iranian oil customers expire this week.China is Iran’s number-one customer, while India is the second-largest buyer of Iranian oil, so the end of the U.S. waivers will mostly affect refiners in those two oil importers who will be scrambling to source crude from other sources or risk secondary U.S. sanctions. “China and India should do so to grab more bargaining power to make oil prices more sustainable,” Jawaharlal Nehru University Professor Srikanth Kondapalli told the Global Times in a recent interview, commenting on the benefits of an oil buyers’ club.
$1 Billion In Iranian Crude Is Stranded At A Chinese Port - It's no secret that Beijing has chafed at American audacity to try and dictate whom Chinese refineries can and can't buy oil from. And in the latest example of just how aggravating the decision to end waivers for Iranian crude imports has been for the world's second-largest economy, Reuters reported that some 20 million barrels of Iranian crude have been languishing at the northeastern port of Dalian for months, but because of the US's decision to re-impose sanctions on Iran back in November, nobody wants to touch the oil. Even when the waivers were in effect, Chinese refineries couldn't secure financing and insurance that would allow them to purchase the oil because of the uncertainty surrounding the future of the waivers. Iran sent the oil to China via the National Iranian Tanker Company before the sanctions were imposed as Iran struggled with a backlog of oil that had exhausted the country's domestic storage capacity. So Beijing, the largest buyer of Iranian oil, allowed the NTCC to store some oil in so-called bonded storage tanks situated in the Dalian port. The oil has yet to go through Chinese customs.China filed a formal complaint with the US over its decision to end the waivers, but the US has refused to consider any exceptions to its plans to reimpose full sanctions. As one analyst told Reuters, no Chinese company will touch the oil unless specifically instructed to do so by the Chinese government. The oil is being held in so-called bonded storage tanks at the port, which means it has yet to clear Chinese customs. Despite a six-month waiver to the start of May that allowed China to continue some Iranian imports, shipping data shows little of this oil has been moved. Traders and refinery sources pointed to uncertainty over the terms of the waiver and said independent refiners had been unable to secure payment or insurance channels, while state refiners struggled to find vessels. The future of the crude, worth well over $1 billion at current prices, has become even more unclear after Washington last week increased its pressure on Iran, saying it would end all sanction exemptions at the start of May. "No responsible Chinese company with any international exposure will have anything to do with Iran oil unless they are specifically told by the Chinese government to do so," said Tilak Doshi of oil and gas consultancy Muse, Stancil & Co in Singapore. To be sure, Reuters says, some of the oil was apparently purchased by a Sinopec refinery. But the bulk of the stock remains untouched. The headache for Beijing will likely only get worse, because shipping data show more Iranian crude is heading for Chinese ports.
U.S. sanctions on Iran, Venezuela set up crunch for heavier oil (Reuters) - Tighter U.S. sanctions on Iranian oil planned for May are adding to a wealth of factors curbing global supply of heavy-medium crude, driving up prices for scarcer barrels and setting up a stand-off between buyers and sellers. The new curbs on Iranian exports come on top of Washington’s earlier ban on Venezuelan crude and output snags in Angola, another big producer of the dense crude grades that best yield lucrative refined products like jet fuel. U.S. officials say overall global oil supply will remain plentiful despite its sanctions, not least from the boom in U.S. shale. But much of the profusion in supply, led by the United States, Saudi Arabia and Russia, is in lighter grades. The price for heavier crudes like Norway’s Grane and Heidrun has been firming over the last few months, a North Sea trader said. Over April, the price of Grane rose from around dated Brent plus 10 cents to close to dated Brent plus $1.00 a barrel. This month Iraq’s SOMO sold 2 million barrels of Basra Heavy crude to China’s Unipec at a premium of over $2 a barrel to its official selling price (OSP), the highest in months, sources said. Refiners are also seeking more of the heavy sweet crude Iran and Venezuela once provided in abundance to produce low-sulfur fuel oil ahead of new shipping emissions rules due next year. JBC cited price assessments from Argus that premiums for Australian heavy, sweet grades Pyrenees and Van Gogh versus North Sea dated rose by $2 per barrel to a record $9 per barrel. Price offerings for several Angolan streams, an approximate alternative to Iranian and Venezuelan crude, were at their highest ever, traders said. State oil company Sonangol was said to have sold a cargo of one of its heaviest grades, Dalia, over the last week for $2 a barrel above dated Brent, a $7 increase from two years ago. Typically, the grade trades at a discount of $1 or more. While some clients are prepared to buy at elevated prices, others are holding back. “We’re resisting it as much as possible,” one potential buyer said. Some of Sonangol’s regular customers balked at the mark-ups, prompting the company to offer the crude to other buyers instead as spot cargoes. These have sold quickly, trading sources said. The current stand-off between buyers and sellers comes down partly to uncertainty over just how much Iranian crude may still flow, crucially to top consumer China, after the May 1 deadline the U.S. has imposed for importers to halt purchases. Analysts expect China may flout the restrictions, especially since Washington may be loath to sanction Chinese companies importing Iranian crude which are at the same time key buyers of U.S. oil and liquid natural gas.
US Ability to Offset Iran Oil Losses Has Limits-- When the U.S. vowed to stop any sales of Iranian crude, Secretary of State Mike Pompeo trumpeted America’s ability to help offset supply losses. Maybe, but it would be a stretch. Oil condensate from the Eagle Ford shale basin in Texas is similar, though a bit heavier than Iran’s light South Pars condensate. But the Eagle Ford produces only about 150,000 barrels a day of its product, compared with Iran’s daily output of 600,000 barrels in 2017. It won’t be "like for like" replacement, said Sandy Fielden, an analyst at Morningstar Inc., by telephone. And "buyers may not be very confident." Meanwhile, American refiners hard-pressed to replace lost supply from Venezuela, Mexico and Canada are lined up for the heavier, high-sulfur oil produced in the U.S. that would be the closest alternative to other types of heavy crude produced in Iran. This week, the Trump administration said it won’t renew waivers that let countries buy Iranian oil without facing U.S. sanctions. Pompeo said the U.S., Saudi Arabia and the U.A.E. will work directly with Iran’s former customers to offset their losses. If the U.S. pulls off its stated intent to push Iran oil sales to zero, the waivers could affect as much as 800,000 total barrels a day of supply.
Iran says intends no closure of Hormuz Strait for int’l shipping —(Xinhua) -- Iran's top military commander said on Sunday that the Islamic republic does not intend to close the Strait of Hormuz for the international shipping. Tehran wants the Strait of Hormuz to remain open with sustained security, Chief of Staff of Iran's Armed Forces Major General Hossein Baqeri was quoted as saying by Tasnim news agency. The Iranian oil and commodities are being freighted through the strait just like the shipments of other countries, Baqeri said. The Iranian Armed Forces are in charge of security of the Strait of Hormuz and "if anybody is to make the Strait of Hormuz unsafe, we will certainly counter it." However, "if the hostility of enemies reaches a point that there is no other choice, that day, we will be fully capable of closing the strait," Baqeri said, referring to the conflict between the United States and Iran over Washington's sanctions against Tehran over its oil sales. "If our oil is not to be shipped over through the Strait of Hormuz, then the oil of others will not go through the strait either," he pointed out.
Iran sees oil above $100/b, repeats threat of Strait of Hormuz closing - A top Iranian military official repeated a threat to shut the Strait of Hormuz if the country's oil shipments are blocked by US sanctions, at the same time an official in parliament warned crude prices could top $100 a barrel, according to reports Sunday by state television news agency iribnews.ir. The threat to close the strait, the world's busiest oil transit chokepoint, was also made April 22 when the US announced it would end sanctions waivers for all buyers of Iranian crude. US President Donald Trump showed Friday he remains focused on domestic gasoline prices as he said in comments to reporters and separately in a tweet that he spoke with OPEC producers and asked them to increase supply to lower prices. "If our oil is not to pass the Strait of Hormuz, oil of others will certainly not pass through this strait either," Mohammad Bagher, chief of staff of the armed forces, said. Meanwhile, a member of Iran's parliament warned that oil prices will skyrocket following the decision to end the waivers. The Trump administration has announced it will end waivers on crude purchase granted to Iran's primary oil buyers in a bid to push Tehran oil sales to zero. The waivers currently issued for China, Greece, India, Italy, Japan, South Korea, Taiwan and Turkey expire on May 2. "Trump is struggling to win the next [presidential] elections" in 2020, Fereydoun Hasanvand, head of the parliament energy committee, said, according to iribnews.ir. He said Washington's plans to "take over Venezuela, cause trouble in Libya, establish martial law in Sudan" are intended to boost support for US sanctions against Iran. "Not extending the oil waivers of some countries is another side of the US measures against Iran. But if Iran's oil is fully sanctioned, oil price will go higher than $100 per barrel," Hasanvand said. ICE June Brent settled $2.20/b lower at $72.15/b, and NYMEX June WTI crude settled $1.91/b lower at $63.30/b at Friday's close. The 21-mile Strait of Hormuz at the mouth of the Persian Gulf handles roughly 40% of global crude trade. "If something happens [to] commercial vessels and oil tankers, the US will be obliged to respond to the questions of the Islamic Revolution Guards Corps., which is in charge of security in the Strait of Hormuz," Bagheri said. He also stressed that Iran will not initiate any move to escalate the tension between Washington and Tehran. "Of course, this doesn't mean shutting down the Strait of Hormuz and we don't have the intention to close the Strait of Hormuz. Unless the enemy or enemies push us to a limit until the day that we can close the Strait of Hormuz," Bagheri said.
What Oil at $100 a Barrel Would Mean for the World Economy - Surging crude prices are posing another headwind for the world economy after President Donald Trump’s “zero” pledge on Iran oil sales. Brent crude has risen about 33 percent this year and is close to the highest in six months. While higher prices due to strong demand typically reflects a robust world economy, a shock from constrained supply is a negative. Much will depend on how sustained the spike proves to be. Exporting nations will enjoy a boost to corporate and government revenues, while consuming nations will bear the cost at the pump, potentially fanning inflation and hurting demand. Ultimately, there comes a point where higher prices may be damaging to everyone. Rising oil prices will hurt household income and spending and it could accelerate inflation. As the world’s biggest importer of oil, China is vulnerable, and many countries in Europe also rely on imported energy. Seasonal effects will also impact. For a sustained hit to growth, economists say oil would need to hold above $100. It also depends on dollar strength or weakness, given crude is priced in greenbacks. Analysis by Oxford Economics found that Brent at $100 per barrel by the end of 2019 means the level of global gross domestic product would be 0.6 percent lower than currently projected by end-2020, with inflation on average 0.7 percentage points higher. An upending of global oil trade around the Iran-Trump spat could continue to have a sizable impact on financial markets, as the affected supply is as much as 800,000 barrels a day. Uncertainties around availability have already whipsawed oil markets. And the political sensitivities of these developments have other markets bracing for volatility. Emerging economies dominate the list of oil-producing nations which is why they’re affected more than developed ones. Winners include Saudi Arabia, Russia, Norway, Nigeria and Ecuador according to analysis by Nomura. Those emerging economies nursing current account and fiscal deficits run the risk of large capital outflows and weaker currencies, which in turn would spark inflation. Nomura’s losers list includes Turkey, Ukraine and India.
Oil prices stumble as hedge funds become overextended: Kemp - (Reuters) - Hedge fund managers added even more bullish long positions in crude oil and refined fuels last week, but positions showed signs of becoming stretched, setting prices up for a setback. Hedge funds and other money managers were net buyers of another 46 million barrels of futures and options in the six major petroleum contracts in the week to April 23, according to exchange and regulatory data. Funds were net buyers of Brent (+16 million barrels), NYMEX and ICE WTI (+24 million) and European gasoil (+8 million) but smaller sellers of U.S. gasoline (-3 million) and left U.S. heating oil positions unchanged. Portfolio managers have been net buyers of petroleum for 15 consecutive weeks, raising their net long position by a total of 609 million barrels since Jan. 8 (https://tmsnrt.rs/2DDsTwq ). Fund buying has been remarkably consistent and persistent, with small additions to net long positions week after week, and a progressive rise in prices, without any of the usual reversals. Nonetheless, there were signs positions were becoming stretched by April 23, so the subsequent tumble in prices should not have been surprising. In absolute terms, fund managers had amassed a bullish net long position of more than 900 million barrels, the largest since oil prices started to slump at the start of October 2018. Fund long positions in petroleum outnumbered short positions by a ratio approaching 9:1, nearing levels that triggered sharp price reversals in the past, most recently in October 2018 and April 2018. Fund positioning in crude hit a ratio approaching 11:1, the most lopsided since oil prices peaked at the start of October 2018, while positioning in gasoline remained near record levels at more than 35:1.
Oil prices steady after Trump says he pressed OPEC to offset Iran sanctions - Oil prices edged higher on Monday, as the market attempted to resume a weeks-long rally that was halted on Friday when U.S. President Donald Trump demanded that producer club OPEC raise output to soften the impact of U.S. sanctions against Iran. Brent crude futures were up 12 cents at $72.27 a barrel around 1:55 p.m. ET (1755 GMT). U.S. West Texas Intermediate crude futures lost 21 cents to $63.51. Both benchmarks fell around 3% in the previous session, after Trump told reporters that he had called OPEC and told the cartel to lower oil prices, without identifying who he spoke to, or if he was speaking about previous discussions with OPEC officials. However, analysts and market participants have downplayed the comments as details were unclear.Sources denied that several high-level OPEC and Saudi officials spoke to Trump. “No representative of OPEC or the Saudi government has come forward to acknowledge any discussion in this regard,” said Jim Ritterbusch, president of Ritterbusch and Associates. “This obvious effort to push gasoline prices down has been attempted previously by Trump and while forcing an initial price decline, such pullbacks have been followed by fresh price highs, sometimes within a matter of days.” Trump’s remarks initially triggered a sell-off, putting a temporary ceiling on a 40 percent price rally since the start of the year. The slide was exacerbated by technical factors including an excessive speculative long position in U.S. crude, analysts said. Speculators raised their combined futures and options net long positions in New York and London by 24,078 contracts to 326,818 during the week to April 23, the highest level since early October. That was the ninth consecutive increase.
Oil Gains as Saudis Signal Readiness to Extend Cuts - Oil edged higher, trading near $64 a barrel in New York, as Saudi Arabia reportedly signaled that OPEC and its allies could extend supply curbs to the end of the year. West Texas Intermediate futures added 1.1 percent. Saudi Energy Minister Khalid Al-Falih said that the Organization of Petroleum Exporting Countries and its partners remain focused on reducing oil inventories, according to an interview by RIA Novosti published on Tuesday. Last week U.S. President Donald Trump said Saudi Arabia and others had agreed to raise production while he tightens sanctions on Iran. Oil climbed to a six-month high last week after the White House announced tougher measures to choke off exports from Iran, ending a series of waivers that currently shields some buyers of Iran crude from American sanctions. While the Saudis pledged to assist any customers lacking supplies, the kingdom also remains committed to a pact with Russia and other producers to keep a lid on output. “In our opinion, OPEC+ will extend its cooperation and supply management for the remainder of 2019,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA in London. WTI for June delivery rose 72 cents to $64.22 a barrel on the New York Mercantile Exchange as of 10:40 a.m. in London. The contract closed 0.3 percent higher on Monday, snapping a three-session drop. Brent for June settlement, which expires Tuesday, gained 85 cents to $72.89 a barrel on the London-based ICE Futures Europe exchange. The contract, which slipped 0.2 percent on Monday, was at a premium of $8.37 to WTI. The more-active July contract added 74 cents. The producers’ group will try to reduce commercial inventories and focus on “global oil output, trying to correct it via our OPEC+ agreement, maybe from July to the end of the year,” Al-Falih told RIA in Riyadh. Most ministers involved in the current cuts agreement favor an extension, he said. Saudi Arabia is facing a tricky task to balance the market at it needs to revive its economy, while trying to placate Trump, who wants lower prices. International Monetary Fund data show the kingdom needs crude at about $85 a barrel -- well above current levels -- to balance its budget this year.
Oil ends mixed; uncertainty surrounds OPEC's next move after Trump's latest call for output boost - Crude-oil futures ended on a mixed note Monday, with U.S. prices managing to recoup a small portion of last week's loss, but global benchmark prices failing to hold on to modest gains. Uncertainty surrounds OPEC's next move in the wake of U.S. President Donald Trump's latest call on the Saudis and their allies to boost crude production. The Saudis may have some difficulty in finding an incentive to raise output, however. The Saudis need an oil price of about $85 a barrel to balance its budget this year, up from a forecast of $73 in September, Bloomberg reported Monday, citing data from the International Monetary Fund. Marshall Steeves, energy markets analyst at Informa Economics, told MarketWatch that the $85 figure seems "rather high," but Saudi Arabia's "main incentive to increase production is to stop losing market share to unconventional U.S. producers, while maximizing their own revenues." "They may well decide along with Russia to increase production quotas at their late June meeting, but that is a matter for another day," he said. For now, the modest rebound in U.S. prices "looks like a technical snapback after June WTI failed to retest Friday's low." U.S.-based West Texas Intermediate crude for June delivery rose 20 cents, or 0.3%, to settle at $63.50 a barrel. Prices tumbled 2.9% to settle at $63.30 a barrel on the New York Mercantile Exchange Friday to post a loss of 1.2% for the week, following seven consecutive weeks of gains, according to Dow Jones Market Data. In contrast, June Brent crude , the global benchmark, fell by 11 cents, or 0.2%, to settle at $72.04 a barrel after brief move higher. The contract, which expires at Tuesday's settlement, fell 3% on Friday. Trump has "repeatedly tried to influence OPEC's decision making when it comes to output but there's been no evidence that it's been in any way successful," said Craig Erlam, senior market analyst at Oanda. "So why are markets paying so much attention now? They're not really. Oil prices were looking very overextended to the upside and Trump's comments -- intentionally or not -- provided the perfect opportunity to cut exposure and allow the market to correct," he said, in a daily note. That led to recent losses. Oil contracts closed off their worst levels on Friday after OPEC's Secretary-General Mohammed Barkindo said he hadn't spoken with Trump, and The Wall Street Journal reported that Saudi Arabia's energy minister Khalid al-Falih wasn't part of those talks either. Trump later tweeted that he had spoken to Saudi Arabia.
Oil rises on Venezuela turmoil, Saudi support for OPEC cuts - Oil prices on Tuesday as Venezuela’s opposition leader called on the military to back him to end Nicolas Maduro’s rule and after Saudi Arabia said a deal between producers to withhold output could be extended beyond June to cover all of 2019. The situation in Venezuela, an OPEC member whose oil exports have been hit by U.S. sanctions and an economic crisis, was fluid on Tuesday. The government promptly dismissed any suggestion of a military insurrection. The statements by Saudi energy minister Khalid Al-Falih came despite pressure by U.S. President Donald Trump to raise output to make up for a supply shortfall expected from tightening U.S. sanctions against Iran. “There was an uptick even without Venezuela due to Falih’s comments,” said analyst Olivier Jakob at Petromatrix Brent crude futures were up $1.10, or 1.5%, $73.14 per barrel around 8:30 a.m. ET (1230 GMT). U.S. West Texas Intermediate crude futures rose $1.04, or 1.6%, $64.54 per barrel. Brent hit a six-month high above $75 last week because of tightening global markets amid U.S. sanctions on Iran and Venezuela coupled with Russian oil export problems stemming from a contaminated pipeline. Prices had come under downward pressure earlier on Tuesday after data on China’s factory activity weighed on financial markets, including crude oil futures, as it suggested Asia’s biggest economy is still struggling to regain traction. Despite a shaky global economy, oil prices have surged by about 36%-42% since January, lifted by supply cuts led by the Middle East-dominated producer club of OPEC as well as by U.S. sanctions on producers Iran and Venezuela.
Oil traders eye Saudi Arabia's response in a critical juncture for crude - Global oil markets sit at a critical juncture, with risks to supply being balanced against rising prices and questions over whether major producers will now turn on the taps. Brent crude touched $75 per barrel last week for the first time this year, helping the benchmark to log a fifth positive week in a row and add to the year’s near 40% gain. “This is definitely something we have to monitor,” UBS APAC Chief Investment Officer Adrian Zuercher told CNBC’s “Squawk Box Asia.” “It will remain volatile,” he added. “We expect Brent to remain between 70 and 80 U.S. dollars at this point.” WTI also moved above $65 a barrel, even as rising U.S stockpiles and surging U.S production slowed some of the recent price momentum. Renewed U.S. efforts to curb Iranian output, escalating tensions in Libya, supply outages in Nigeria and the ongoing crisis in Venezuela have created a complex and uncertain outlook for crude. The week ahead will be another major test, with Iranian sanction waivers officially expiring in early May, and the U.S decision to cancel all concessions raising new questions about how Saudi Arabia and other major producers will respond. “We now know that OPEC has that spare capacity,” Goldman Sachs’ Head of Commodities Research Jeff Currie told CNBCs “Power Lunch,” reiterating his Brent forecast of $70-75 barrel for the second quarter of 2019. “They ramped it up, they took it back down, and we think the (Iran) shock is roughly 900,000 barrels per day, and we just saw OPEC, at least core OPEC, taking 1.8 million barrels per day off the market,” Currie added. The decision to end the waivers could remove 1.3 million barrels per day of Iranian exports, according to S&P Global Platts. OPEC has about 3.3 million barrels per day of spare production capacity, according to the International Energy Agency, of which about 2.2 million barrels per day is held by Saudi Arabia.
Russia, Saudi Arabia Defy Trump's Push for Lower Oil Prices - Russia and OPEC members appear reluctant to support U.S. President Trump's push for lower prices. Total oil output worldwide should remain steady in at least the near term, analysts say as Russia and OPEC members appear reluctant to support U.S. President Trump’s push for lower prices. On one hand, Russia agreed to cut output with OPEC member countries in December. On the other hand, Saudi Arabia, amid increased tensions with the U.S. in the wake of the murder of Saudi journalist Jamal Khashoggi, has so far not agreed to boost output. Meanwhile, President Trump has vociferously called on OPEC and its allies to take actions to lower oil prices. According to a recent article in “The Wall Street Journal,” Russia has also begun to align itself behind OPEC, by agreeing to cut oil production (if Iran was allowed to continue output) and has become an unofficial yet influential partner with OPEC. However, Russia’s influence on OPEC member countries in its obvious deference to President Trump’s push to boost output, is not on the same scale as that of Saudi Arabia’s. "It is important to stress that the relationship between Russia and Saudi Arabia is not symmetric in the sense that it is Saudi Arabia that usually does the heavy lifting in terms of output cuts (like what happened since December),” “Of course, from a Saudi (and Russian) perspective, it is useful to coordinate efforts and send a consistent signal as this helps stabilize market expectations, but this power mainly comes from the influence that Saudi Arabia has on the market. So the idea that OPEC now needs Russia for it to function is a bit over-stretched." In a paper entitled “OPEC Policy in the Age of Trump,” Fattouh recently wrote “extrapolating” Saudi Arabia’s moves in 2018 and in 2019 are “risky.” “The assumption that Saudi policy will reverse its current strategy under Trump’s pressure does not reflect the shift in Saudi thinking and the current uncertainties and weaknesses engulfing the oil market,” Fattouh wrote. The fact also remains that “oil demand is steady and the market is tightening,” Fattouh said. “Last year, we had many volatile movements induced by events, especially in 2018,” Fattouh said. “So, what I’m trying to say is that those events are unlikely to play out in the same way they did.” Saudi Arabia’s official line is it will “look at the situation but are not going to take a preemptive action, until what they see what happens in the market,” Fattouh said.
Oil Prices Rebound As Saudis Reassure Markets -- Oil rebounded on Tuesday after two days of declines, pushed higher by turmoil in Venezuela and the insistence by Saudi officials that the OPEC+ production cuts would be extended in the second half of 2019. Saudi oil minister Khalid al-Falih told the Russian press that OPEC+ should maintain production cuts in some form through the end of the year. Oil prices bounced on the news. As of Tuesday morning, opposition leader Juan Guaidó had reportedly launched an attempted military coup. “The definitive end of the usurpation started today,” said Guaidó, according to Argus Media. “The National Armed Forces, today, brave soldiers, patriots loyal to the constitution, have heeded our call.” The reports suggest that some generals in the armed forces have ordered their troops to back the coup. At the time of this writing, it was unclear how successful the campaign would be. The U.S. Fish and Wildlife Service said that the Trump administration’s plan to open up the Alaska National Wildlife Refuge (ANWR) for drilling did not adequately consider the impacts of oil spills, climate change and the welfare of polar bears. The Interior Department is hoping to hold a lease sale later this year in ANWR, but Fish & Wildlife (which is housed within Interior) said ExxonMobil is interested in making more acquisitions in the Permian, according to the FT. A senior VP at Exxon told analysts on an earnings call last week that he “would be surprised if over time we did not pick up more Permian acreage.” The comments come in light of the battle between Chevron and Occidental Petroleum for Anadarko Petroleum. Whoever wins that bidding war will substantially increase their presence in the Permian.
Overly Bullish Hedge Funds Set The Stage For Oil Price Drop - For more than ten weeks, portfolio managers have been consistently amassing bullish bets in the most important petroleum futures contracts, as market fundamentals were pointing to OPEC over-delivering on the production cuts, Venezuela’s supply crashing, and potential losses from conflict-torn Libya, amid resilient global oil demand growth.Last week, oil prices jumped on Monday on the news that the U.S. is ending the sanction waivers for all Iranian oil buyers. And hedge funds continued to bet on higher prices and a tightening oil market. However, the net long position—the difference between bullish and bearish bets—in WTI and Brent begins to look too stretched to the bullish side, making oil prices vulnerable to declines now if (or rather, when) money managers decide to do some profit taking and liquidate some of their bets on rising oil prices, analysts say. According to data compiled by Reuters market analyst John Kemp, as of April 23, the latest available exchange data, hedge fund and other money managers held long positions in Brent Crude and WTI Crude that outnumbered shorts in a ratio of 11:1—the most lopsided bullish positioning since October 2018, when oil prices started crashing to lose 40 percent until the end of 2018.Portfolio managers have now closed out nearly all short positions that they had started to open at the end of August last year, Kemp says.Hedge funds have been continuously amassing bets on rising WTI Crude prices for the past nine weeks, the longest bullish-building trading sentiment since 2006, according to data from the U.S. Commodity Futures Trading Commission compiled by Bloomberg. The number of long positions in WTI Crude increased by 1.7 percent in the week to April 23, while the number of short positions slumped by 18 percent.
Oil Prices Finish Higher -WTI and Brent futures edged upward Tuesday. West Texas Intermediate (WTI) and Brent crude oil futures finished higher Tuesday. June WTI futures added 41 cents Tuesday, settling at $63.91 per barrel. The U.S. benchmark peaked at $64.75 and bottomed out at $63.30. Brent crude oil for July delivery gained 52 cents and ended the day at $72.06 per barrel. “Looks like the Saudis didn’t get the phone call from Trump,” Barani Krishnan, senior commodities analyst with Investing.com, told Rigzone. Krishnan was referring to reports that Trump said he had called OPEC and demanded that the cartel take action against escalating prices. He added that efforts by Trump and the Saudi Arabian government to influence oil price movements appear to be intensifying. “The ‘you-squeeze-me, I-squeeze-you’ game in oil is heightening with the Saudis giving the U.S. President a little payback for their near-$40 per barrel misery from last winter,” said Krishnan. “Saudi Energy Minister Khalid al-Falih’s clear disregard of Trump’s attempt to corner OPEC into another production hike via a phone call supposedly placed to a mysterious source at the cartel tells the market that Riyadh is digging its heels in for a fight with the White House on who’s really the boss of world oil prices.” Krishnan added that the Saudis conveyed the message just a day after Russian President Vladimir Putin relayed to the Kingdom a “gentle reminder … that it was the Great Russian Bear, not the mighty American Eagle, that came to their rescue last year when OPEC was floundering.” Moreover, Krishnan observed that it makes sense for Falih to seek common ground with his Russian counterpart, Alexander Novak. “Putin’s stance itself is quite mystifying as Russia’s sovereign wealth fund chief Kirill Dmitriev and oil giant Rosneft’s head Igor Sechin have warned him in recent months that production cuts were costing their nation lost market share to U.S. crude,” said Krishnan. “These Russian oligarchs are openly pushing for more production to foster healthy competition in the world oil market.” Meanwhile, Saudi Arabia has “the best of both worlds” because it gets $70-plus oil and watches its enemy Iran struggle amid sanctions on exports of its crude oil, he said.
WTI Slides After Big Surprise Crude Build - Oil prices rallied on the day amid a sliding dollar and increased protests in Venezuela adding to concerns about supply (despite a slowdown in China PMI potentially questioning demand).“The market is currently witnessing the largest number of barrels subject to potential outage in many years, between Venezuela, Iran, Nigeria, Algeria and Libya,” said Leo Mariani, a KeyBanc Capital Markets Inc. analyst. API:
- Crude +6.81 mm (+1.5mm exp)
- Cushing +1.353mm
- Gasoline -1.055mm (-1.5mm exp)
- Distillates -2.058mm (-1mm exp)
After a surprise crude build last week, expectations were for another small stock rise and yet another gasoline drawdown and API did not disappoint with a large 6.8mm crude build... This is the 11th weekly draw in gasoline (and 7th weekly draw in distillates) in a row... “We have to keep in mind that with more than 12 million barrels being produced, until we ramp back those refineries up, we will probably see crude stocks build,” Gene McGillian, manager of market research at Tradition Energy, saysWTI hovered around $64 ahead of the API print and kneejerked lower after the print. The developments in Venezuela triggered a spate of buying early on Tuesday, but that could reverse just as quickly if the opposition’s chances look shaky, said Michael Hiley, head of OTC energy trading at LPS Futures in New York. In the longer term, Maduro’s ouster could lower prices, he said. “They have some of the best reserves in the world and you would just need the proper capital investment to crank that up again,” Hiley said. “It will ultimately end up with more oil on the market, but short-term the knee-jerk movement for prices is still up.”
Oil prices fall as US crude stockpiles surge by 9.9 million barrels - Oil prices fell on Wednesday as U.S. crude stocks rose last week to the highest since Sept. 2017, while gasoline stockpiles increased and distillate inventories fell.An intensifying crisis in Venezuela along with tightened U.S. sanctions on Iran partly offset the impact of the unexpected rise in U.S. crude inventories. Crude inventories rose by 9.9 million barrels in the last week to 470.6 million, the U.S. Energy Information Administration said on Wednesday. That compared with analysts’ expectations for an increase of 1.5 million barrels.Gasoline stocks rose by 917,000 barrels, compared with analysts’ expectations in a Reuters poll for a 1 million-barrel drop. Distillate stockpiles, which include diesel and heating oil, fell by 1.3 million barrels, versus expectations for a 193,000-barrel drop, the EIA data showed.Brent crude oil futures were down 21 cents at $71.85 per barrel around 10:40 a.m. ET (1440 GMT). U.S. crude futures fell 55 cents at $63.36 per barrel. Trading was thin as May 1 is a holiday in many markets.Markets also keenly watched Venezuela, where opposition leader Juan Guaido called for an uprising against President Nicolas Maduro. Many observers fear this could lead to escalating violence and further disruptions to crude supply.The unrest adds to a range of fluid geopolitical factors which have been affecting oil prices in recent months. “There have been wild cards aplenty for the oil markets. The seemingly perennial U.S.-China trade spat, the extent of Venezuela’s supply woes and the Iran factor are just some,” “Yet these are shaking off their wildcard status and instead are transitioning into known-knowns”, Brennock added, citing widespread hopes that the two largest economies will soon resolve their dispute and a view that U.S. sanctions on Iran and Venezuela were “largely baked into prices.” Oil markets have already tightened this year due to supply cuts led by OPEC as well as the sanctions on Venezuela and Iran.
WTI Slides After Huge Crude Build, Record Production WTI slid lower overnight amid signs of a sharp increase in U.S. crude inventories from API and concerns over the strength of economic growth in China, but rebounded back to pre-API level ahead of this morning's official inventory data as the dollar tumbled.Prices also slid as an attempted uprising against President Nicolas Maduro in OPEC member Venezuela appeared to fizzle. “The market is currently witnessing the largest number of barrels subject to potential outage in many years, between Venezuela, Iran, Nigeria, Algeria and Libya,” said Leo Mariani, a KeyBanc Capital Markets Inc. analyst. DOE:
- Crude +9.93mm (+1.5mm exp) - highest since Nov 2018
- Cushing +265k
- Gasoline +917k (-1.5mm exp)
- Distillates -1.307mm (-1mm exp)
US crude inventories rose for the 5th week in the last 6 with a 9.934mm build - the biggest since November. At the same time, the 10-week streak of draws in gasoline inventories is over as stocks rose 917k last week... “Amid this host of bullish catalysts is one deepening pocket of weakness -- U.S. oil stocks are swelling due to an upswing in crude inventories,” said Stephen Brennock, an analyst at PVM Oil Associates Ltd. in London. “Glum alarm bells are ringing louder in the U.S.”US Crude production rose to a new record high, bucking the lower rig count trend...
Oil prices drop as U.S. crude supplies post biggest weekly climb of the year - U.S. oil prices finished lower on Wednesday after a U.S. government report revealed a nearly 10 million-barrel rise in domestic crude supplies — the biggest weekly climb of the year so far. Global benchmark prices for oil, however, ended the session modestly higher, finding continued support from risks to global supplies. The latest move for prices follows gains seen in April as Saudi Arabia looked to defy President Donald Trump’s request to pump more oil to keep down prices, and as a fresh uprising in Venezuela fed uncertainty over the country’s output. On Wednesday, U.S.-based West Texas Intermediate crude for June delivery CLM9, +0.15% lost 31 cents, or 0.5%, to settle at $63.60 a barrel on the New York Mercantile Exchange. Front-month contract prices notched an April rise of 6.3% — their fourth straight monthly gain, according to Dow Jones Market Data. WTI prices saw some support, paring a bit of their earlier losses, as the U.S. dollar weakened further in the immediate wake of the Federal Reserve’s decision Wednesday to hold policy steady. The dollar then moved back up just as oil futures settled. The latest U.S. supply data “could continue to put pressure on crude prices in the short term,” said Tariq Zahir, managing member at Tyche Capital Advisors. “Of course, the situation in Venezuela is still quite fluid.” “We will also have to watch how much and when Saudi Arabia or Russia adds oil production to the market,” following the Trump administration’s decision to end U.S. sanctions waivers on Iranian oil, he said. The waivers expire on Thursday. Read: Here’s what the expiration of waivers on Iran crude sanctions will mean for oil prices Also read: The end of Iranian oil waivers and what it means for the OPEC-led output cut pact Global benchmark July Brent crude LCON9, +0.03% which is now the front month, added 12 cents, or 0.2%, to $72.18 a barrel on ICE Futures Europe. Front-month contract prices were up about 6.5% for last month. Brent hit a six-month high above $75 as recently as last week before drifting mostly lower since. The Energy Information Administration on Wednesday reported that U.S. crude supplies rose by 9.9 million barrels for the week ended April 26. That surpassed the rise of 1.4 million barrels expected by analysts polled by S&P Global Platts. Data from the American Petroleum Institute on Tuesday had shown an increase of 6.8 million barrels, according to sources.
OPEC oil output hits four-year low in April on Iran, Venezuela: Reuters survey (Reuters) - OPEC oil supply hit a four-year low in April, a Reuters survey found, due to further involuntary declines in sanctions-hit Iran and Venezuela and output restraint by top exporter Saudi Arabia. The 14-member Organization of the Petroleum Exporting Countries pumped 30.23 million barrels per day (bpd) this month, the survey showed, down 90,000 bpd from March and the lowest OPEC total since 2015, the Reuters survey showed. The survey suggests that Saudi Arabia and its Gulf allies are maintaining even larger supply cuts than called for by OPEC’s latest deal, shrugging off pressure from U.S. President Donald Trump. On Friday, Trump said he had called OPEC to tell the group to bring down prices. Crude oil is trading above $73 a barrel and hit a six-month high above $75 last week, boosted by Saudi supply restraint and curbs in Venezuela and Iran, which face U.S. sanctions that are limiting their exports. “The Iran sanctions come on top of already fragile supplies and raise concerns about tightening markets,” Norbert Ruecker of Swiss bank Julius Baer said. OPEC, Russia and other non-members, an alliance known as OPEC+, agreed in December to reduce supply by 1.2 million bpd from Jan. 1. OPEC’s share of the cut is 800,000 bpd, to be delivered by 11 members - all except Iran, Libya and Venezuela. In April, the 11 OPEC members bound by the agreement achieved 132 percent of pledged cuts, the survey found, compared to 145 percent in March, due to higher production in Nigeria and small increases in Saudi Arabia and Iraq. Lower supply in two of the exempt producers, Iran and Venezuela, more than offset gains elsewhere. Iran posted OPEC’s biggest supply drop this month of 150,000 bpd, the survey found. In Venezuela, supply fell by 100,000 bpd due to the impact of U.S. sanctions on state oil company PDVSA and a long-term decline in production, according to the survey. Venezuela was once a top-three OPEC producer. Top exporter Saudi Arabia raised output slightly in April from March, although Riyadh continued to deliver larger cuts than required under the supply deal, as did Gulf allies the United Arab Emirates and Kuwait. Saudi Arabia has said it would replace losses in Iran and Venezuela but is wary of pumping more unless there is customer demand. Energy Minister Khalid al-Falih on Tuesday said the kingdom will not rush to boost supply to make up for Iran. OPEC’s biggest production gain occurred in Nigeria, where Total’s Egina field has helped boost output. Libya, the third producer exempted from making voluntary curbs, also boosted output. Nigeria says the Egina field produces condensate, a type of light oil excluded from the OPEC cuts. The survey includes the field based on Total’s listing of it as a crude producer. Smaller producers Congo, Ecuador and Gabon also pumped above their targets, the survey found. April’s output is the lowest by OPEC since February 2015, excluding membership changes that have taken place since then, Reuters surveys show.
Oil prices tumble 3% despite tighter sanctions on Iran and Venezuela turmoil - Oil prices fell as much as 3% on Thursday, breaking through a key support level and threatening to tumble even further. Crude futures declined despite a wave of geopolitical concerns, including turmoil in Venezuela and the launch of new American measures aimed at driving Iran’s crude exports to zero. Brent crude oil futures, the international benchmark for oil prices, fell $1.64, or 2.3%, to $70.54 per barrel around 10:25 a.m. ET (1425 GMT). U.S. West Texas Intermediate crude fell $1.97, or 3.1% to $61.63. “The $62 level is an important level. If you break through it you could trade down to 58 pretty quickly,” said John Kilduff, founding partner at energy hedge fund Again Capital. The drop was partly due to the overhang from Wednesday’s weekly report on U.S. crude stockpiles, which showed inventories surging by 9.9 million barrels. The data also showed U.S. oil production ticking up to a record 12.3 million barrels per day. Reports that Asian refineries are asking Saudi Arabia for more crude oil are also weighing on prices, said Kilduff. Any sign that the Saudis will answer those calls will push prices lower, he said. Washington on Thursday stopped issuing waivers that allow several countries, including China and India, to purchase Iranian oil. The Trump administration restored sanctions on Iran’s energy industry in November. President Donald Trump is largely relying on Saudi Arabia to fill the gap left by Iranian supplies. Saudi Arabia has not explicitly committed to hiking output, but says it will respond to the market’s needs. “Saudi Arabia, the UAE, and Russia will likely fill the supply gap in the coming months, increasing the U.S. incentive to strictly enforce compliance and pressure Iran,” Paul Sheldon, chief geopolitical adviser at S&P Global Platts Analytics said in an email briefing. Saudi Arabia, its fellow OPEC members, and other producers including Russia have been limiting supply since January. The so-called OPEC+ alliance meets at the end of next month to discuss whether to extend the six-month deal beyond June.
US launches plan to choke off Iran's energy exports, casting uncertainty over oil prices -The United States sharply tightened energy sanctions against Iran on Thursday, seeking to cut the Islamic Republic’s exports to zero and ushering in a new era of uncertainty for the oil market.President Donald Trump restored Obama-era sanctions against Iran last year but granted waivers to eight nations, allowing them to import limited quantities of Iranian crude. Last week, his administration surprised the market by announcing it would not extend the waivers.Investors and analysts expected Trump to tighten the waivers every six months, allowing China, India, Turkey and other importers to gradually wind down purchases of Iranian crude.The sudden move to cut off Iran’s exports threatens to wipe out much of the shipments, which have recently totaled more than 1 million barrels per day, or roughly 1% of global consumption. To fill that gap and prevent fuel costs from spiking, Trump has turned to his allies in Saudi Arabia, the world’s top oil exporter. But the Saudis have not made firm commitments and continue to consider extending a six-month deal to limit output with OPEC and other producers. That is raising concerns about a period of tighter supply and higher oil prices.“President Trump’s decision to zero out waivers for importers of Iranian oil on May 2 represents an audacious act of oil brinkmanship as the strategy of keeping prices contained now rests almost exclusively on Saudi Arabia’s willingness to open the taps amid accelerating global supply outages,” Helima Croft, global head of commodity strategy at RBC Capital Markets, said in a recent research note.Oil prices initially jumped to six-month highs after Trump announced the waivers would be revoked, with international benchmark Brent crude hitting $75.60 and U.S. crude rising to $66.60. Prices were trading around $71 and $62, respectively, on Thursday. Analysts said the tighter sanctions alone will not cause a supply shock, but they make the oil market more vulnerable to a shortage that sends fuel costs higher. That is in part because oversupply in the oil market is draining, and supply and demand are coming into balance. Some analysts even think the market is slightly undersupplied.
US crude sinks 2.8% to one-month low, settling at $61.81, as supply concerns ease - Oil prices fell as much as 4% on Thursday, breaking through a key support level, as rising U.S. crude stockpiles helped offset concerns about a supply crunch. Crude futures declined despite a wave of geopolitical concerns, including political turmoil in Venezuela and the launch of new American measures aimed at driving Iran’s crude exports to zero. U.S. West Texas Intermediate crude settled $1.81 lower at $61.81 on Thursday, tumbling 2.8% to its weakest closing price since April 1. WTI plunged 4% to a session low at $60.95 earlier in the session. “The $62 level is an important level. If you break through it you could trade down to $58 pretty quickly,” said John Kilduff, founding partner at energy hedge fund Again Capital. Brent crude oil futures, the international benchmark for oil prices, fell $1.43, or 2%, to $70.75 per barrel. Brent fell as low as $69.68 earlier in the session. The drop was partly due to the overhang from Wednesday’s weekly report on U.S. crude stockpiles, which showed inventories surging by 9.9 million barrels. The data also showed U.S. oil production ticking up to a record 12.3 million barrels per day. U.s. crude stockpiles have risen in five of the last six weeks, helping to ease the market’s concern that global oil supplies are getting tight. “The market is a little bit spooked that we might have a repeat of last year, where there are all these bullish factors on the supply side globally, but U.S. shale [oil] is just this big behemoth in the background,” ns.
Has The Oil Rally Reached Its Limit? - The oil price rally ended this week, with rising U.S. inventories and production scaring away the bulls. Crude stocks soared by 10 million barrels and U.S. production rose to 12.3 mb/d in the last week of April. “Even with deep losses in supply from Iran and Venezuela, as well as a few other countries around the world, OPEC+ will still need to hold back production to balance the market,” SEB analyst Bjarne Schieldrop said in a note Iran’s oil minister said that OPEC may fall apart. “Iran is a member of OPEC for its interests and any threat from member states won’t go unanswered,” Bijan Namdar Zanganeh said, referring to Saudi Arabia’s apparent coordination with the U.S. on Iran sanctions. “I told [OPEC Secretary-General Mohammad] Barkindo that OPEC is in danger by the unilateralism of some members and the organization faces the risk of collapse.” Last year, Qatar quit OPEC, but it would be a much more significant development of Iran were to exit. ExxonMobil said that it would move forward on a $2 billion expansion of its Baytown, TX chemical facility. The investment is the latest in the company’s “Growing the Gulf” campaign, a $20 billion 10-year spending spree on chemical and petrochemical projects on the Gulf Coast. The increase in crude inventories by 10 million barrels last week helped spark an oil price selloff on Thursday. “Amid this host of bullish catalysts is one deepening pocket of weakness - U.S. oil stocks are swelling due to an upswing in crude inventories,” said Stephen Brennock, an analyst at PVM Oil Associates Ltd. in London, according to Bloomberg. “Glut alarm bells are ringing louder in the U.S.” Phillips 66 saw its profits fall to just $204 million in the first quarter, less than half of the $524 million it earned in the same quarter a year earlier. The company said that outages and low refining margins ate into the bottom line. Shell reported a minor decline in first quarter earnings to $5.4 billion, exceeding forecasts. Its trading and LNG unit helped mitigate the poor market conditions, and allowed Shell to outperform its peers.
Oil sinks 2.2% this week, settling at $61.94, as US stockpiles rise and supply fears fade - Oil prices edged up on Friday, as strong U.S. economic data boosted demand sentiment and as production losses in sanctions-hit Iran and Venezuela tightened the market. Still, oil futures posted weekly declines on a jump in U.S. crude inventories reported this week. U.S. West Texas Intermediate crude futures settled 13 cents higher at $61.94 per barrel, after sinking 2.8% on Thursday. WTI fell 2.2% this week, logging its second straight weekly decline. Brent crude oil futures rose 10 cents to $70.85 per barrel. The international benchmark for oil prices slumped 2% in the previous session and ended the week 1.8 percent lower, for its first weekly loss in five weeks. A U.S. jobs report that showed growth surging in April and the unemployment rate dropping to a more than 49-year low of 3.6%, increased the expectation that crude demand would stay strong, said Phil Flynn, senior analyst at Price Futures Group in Chicago. “After the strong jobs report, the market is kind of putting that big build this week into perspective,” Flynn said. Equities rallied and the U.S. dollar weakened following the report, which also supported oil futures. Oil prices tend to follow moves in equities, and demand for the U.S. dollar-linked commodity often increases when the greenback slips. Gains in the oil market, however, were limited by a spike in U.S. crude inventories reported this week and rising oil production, which hit a record 12.3 million barrels per day last week. Exports of U.S. crude broke through 3 million bpd in November for the first time and hit a record 3.6 million bpd earlier this year, according to data from the Energy Information Administration. U.S. energy firms this week increased the number of oil rigs operating for the first time in three weeks even as crude output decelerates with the rig count dropping five months in a row due to spending cuts.Companies added two oil rigs in the week to May 3, bringing the total count to 807, lower than the 834 rigs active this time last year, Baker Hughes energy services firm said in its closely followed report on Friday.
Saudi oil output may rise in June, but U.S. may not get the extra exports it wants (Reuters) - Saudi Arabia’s oil output may edge up in June, sources familiar with the kingdom’s policy said, but the extra crude may be used for domestic power generation rather than providing the boost to exports that Washington has been seeking. The sources said any rise in Saudi output would still be within its output quota in a pact on supply cuts agreed between OPEC and its allies, a group known as OPEC+. Production from the world’s top crude exporter in May is expected to be around 10 million barrels per day (bpd), slightly higher than April but still below its quota under the OPEC-led pact of 10.3 million bpd, industry sources said. Riyadh often lifts output in the hot summer months to fuel oil-fired power plants and meet rising electricity demand, which means exports do not necessarily rise. One of the sources said the May output rise was not related to Washington’s push for more OPEC oil after it ended waivers granted to buyers of Iranian oil. The waivers had allowed them to purchase crude from Iran despite U.S. sanctions. U.S. President Donald Trump said last week he had called Saudi Arabia and OPEC and told them to lower oil prices, but he did not say who he spoke to or when the conversations took place. Oil prices rose to a six-month high last week above $75 a barrel, partly due to concerns about falling Iranian supplies. Brent was trading around $70 on Thursday. “The Saudis want oil prices to stay at current levels at least for a month or two. They don’t want to raise their production above the 10.3 million bpd, because they are part of the OPEC+ pact, but they are also being pressured by the U.S. to increase their output,” one of the sources said. “One thing for sure is that if customers asked for more oil they (the Saudis) will then raise output,” the source added.
IMF warns of slowing growth and rising unrest across the Middle East - Slowing global growth and elevated tensions in trade and geopolitics are posing economic challenges for countries in the Middle East, according to the International Monetary Fund’s latest report. “Global developments are affecting the outlook for this year, namely the slowdown in growth especially on trade, the volatility in the oil price, as well as also the global financing conditions, in additional to a certain number of country specific issues,” Jihad Azour, the IMF’s director of the Middle East and Central Asia, told CNBC on Sunday. The Regional Economic Outlook report — published each spring by the IMF’s Middle East and Central Asia Department — also highlighted how volatile oil prices are negatively affecting some countries, while others are grappling with rising public debt. “For oil-importing countries where debt is high, it’s very important to tackle it and to reduce the level of deficit. That will allow those countries to reduce their debt burden over GDP,” Azour added. Growth for oil exporters is projected to dip slightly in 2019 to 0.4 percent, from 0.6 percent the previous year, driven by an economic contraction in Iran following the renewal of sanctions. For oil-importing countries in the region, growth is expected to slow, declining from 4.2 percent in 2018 to a projected 3.6 percent this year. However, that figure is expected to rebound to 4.2 percent from 2020 to 2023. “Despite the current increase in prices, the medium-term price projections of oil remain in the corridor of the mid-$60s,” Azour said. “Therefore it’s very important for countries to pursue and accelerate their diversification strategies and at the same time, maintain their pace of fiscal adjustment that will allow them to reduce their dependence, in terms of revenues on oil,” he added.
Iran's recession is driving a growth slowdown among region's oil exporters, IMF says The impact of U.S. sanctions on Iran’s economy is dragging on the broader region’s activity, according to the latest economic health check from the International Monetary Fund (IMF). The organization predicts a 1.7% contraction in the output of goods and services for non-Gulf Cooperation Council (GCC) oil exporters, after already having shrunk by 1.1% last year. “This is mainly driven by developments in Iran, where the recession is expected to deepen, reducing projected growth by almost 10 percentage points during 2018–20, ” the IMF reported in its 2019 Regional Economic Outlook: Middle East and Central Asia Update, published Monday. Iran’s economy is expected to shrink by 6% this year, after having contracted 3.9% last year, the IMF says. By contrast, it clocked 3.8% growth in 2017, before the Trump administration re-imposed economic sanctions after withdrawing from the 2015 nuclear deal that offered the Islamic Republic relief from prior sanctions. Economists say the combination of hard-hitting sanctions, particularly on the country’s oil exports that began last November, as well as years of economic mismanagement have led to skyrocketing inflation, rising unemployment and a frantic rush to buy dollars. Inflation could exceed 40% Inflation in Iran could reach as high as 40% or higher this year, a senior IMF official said on Monday. “Clearly the re-imposition of sanctions and the removal of the waivers will have additional negative impact on the Iranian economy both in terms of growth and in terms of inflation, where inflation could reach 40 percent or even more this year,” Jihad Azour, the IMF’s Middle East and Central Asia director, told Reuters. This assessment, Azour said, was made before the U.S. announced the end of sanctions waivers for eight of Iran’s largest oil buyers. In 2017, Iran’s inflation rate was just over 9%. For oil exporters in the wider Middle East and North Africa region including the GCC, a slowdown is projected and is still to some extent linked to Iran, the report said. “Growth in MENAP oil exporters is projected at 0.4 percent in 2019,” down from 0.6% in 2018, the lender wrote, using an acronym that includes Afghanistan and Pakistan. “This mainly reflects a sharp decline in Iran’s economic activity (of 6 percent), oil production cuts (in line with the December 2018 OPEC+ agreement), and tighter domestic financial and monetary conditions in some countries.”
OPEC is 'likely to collapse,' warns Iran's oil minister - Iran’s oil minister is warning that OPEC is “likely to collapse” because some members of the 14-nation group are working against their fellow producers.The comment appears to be a thinly veiled reference to Saudi Arabia and theUnited Arab Emirates. The Trump administration tightened energy sanctions against Iran on Thursday, and the White House says the Saudis and Emiratis will work with the U.S. to offset the anticipated drop in Iranian oil supplies.“Iran is an OPEC member just for its interests and if certain OPEC members want to threaten and endanger Iran, Iran will not refrain from responding to them,” Iranian Oil Minister Bijan Zangeneh told Shana, the ministry’s news agency, following a meeting with OPEC Secretary General Mohammed Barkindo in Tehran on Thursday.“I told Mr Barkindo that OPEC is being threatened due to unilateralism by certain members and this organization is likely to collapse,” Zangeneh said.U.S. sanctions, imposed in November, have already cut Iran’s oil exports by about 1 million barrels per day. On Thursday, the Trump administration stopped granting sanctions waivers to some of Iran’s biggest customers. Analysts now expect the Islamic Republic’s exports to fall by another several hundred thousand barrels per day.Saudi Arabia has not explicitly committed to hiking output to fill the gap. After the U.S. announced it would end the sanctions waivers, Saudi Energy Minister Khalid al-Falih said the kingdom would consult with producers and consumers “to ensure a well-balanced and stable oil market.”OPEC and its oil market allies, including Russia, are scheduled to meet on June 25-26 in Vienna to decide whether to extend their deal to limit oil supply, which has been in place since January and expires at the end of June. Saudi Arabia can lift output and still abide by the deal because it is currently pumping about 500,000 bpd below its quota.
Here's Why Taking Iran Oil Exports To Zero Is Likely Impossible - Many analysts believe a US-Israeli war on Iran and Lebanon is likely despite the lack of evidence of preparations for such a war. Although forces could be quickly mobilized after a political decision to go to war, all indications point to a non-military war situation for the simple reason that the US “strangulation war” is not costly to the US establishment and fits perfectly with the objectives of its main Middle Eastern ally, Israel. Nevertheless, menacing letters are being exchanged among involved parties who are, nonetheless, prepared for the worst-case scenario. As far as Iran goes, the “zero oil exports” – the US wants to impose on the 1stof May – may be impossible to achieve. It will not be easy for OPEC members to compensate the two million Iranian barrels of oil daily (out of 3.45 million of total daily production), as President Donald Trump would like. The US objective is to curb Iran’s will and force it to the negotiation table to dictate elements necessary for the security of Israel in the Middle East. A goal no US establishment has ever managed to achieve since the “Islamic Revolution” took power in Iran in 1979, notwithstanding the sanctions imposed over four decades. Iran has land borders with Pakistan, Iraq and Turkey. It is logistically easy to supply these countries with Iran’s high-quality light crude oil at a cheaper price than the market price. During the Bush and Obama eras, Iran never stopped exporting its oil and exchanging it for hard currency or gold, despite sanctions. Moreover, China needs its 650,000 bpd. Several Chinese companies offer technology and industrial services and commerce their expertise and products with Iranian companies in exchange for oil, and these companies are not willing to stop this trade. This alone will be enough to cause the failure of the US establishment’s objective of “zero exports” without necessarily meaning that such a breakdown will lead to a military confrontation. This US administration, like previous ones, will likely fail to curb Iran’s will despite the severe sanctions it has imposed. Nor will it succeed in forcing Iran to stop support for its partners in the Middle East (i.e. Lebanon, Iraq, Syria, Afghanistan and Yemen). The support of Iran to state and non-state actors in the region is a self-imposed obligation cited in many articles in the Iranian constitution. Moreover, Iran will never agree to open its missile industry to inspection or to halt its missile production, as requested by the US establishment. Iran’s missiles represent its main efficient weapon to maintain a balance of forces sufficient to dissuade all its potential enemies. And last, Iran and its Middle Eastern partners will not abandon the Palestinian cause until the last Palestinian group decides to abandon its territory to Israel. Therefore, Trump should be content – as the achievement of his first mandate – with the “gifts” he has given to Prime Minister Benjamin Netanyahu: Jerusalem and the occupied Syrian Golan Heights.
Yemen war dead could hit 233,000 by 2020 in what UN calls ‘humanity’s greatest preventable disaster’ - The death toll from a devastating war in Yemen could soar to nearly a quarter of a million by the end of 2019, the United Nations (UN) has warned, calling the conflict one of the “greatest preventable disasters facing humanity”.In a 60-page report, the UN Development Programme (UNDP) said the fighting between the Gulf-backed Yemen government and the Houthi rebels could also set the country back a generation in terms of development.It warned that if a proper ceasefire is not brokered by the end of the year, the total number of dead could rise to 233,000, with 60 per cent of the deceased being children under the age of five.The UN’s projected count includes 102,000 killed in combat and 131,000 who will die due to a lack of food, health services and infrastructure in the war. It represents a significant increase on the latest death toll, compiled by global mapping group the Armed Conflict Location and Event Data Project (Acled), which said last week 70,000 people have died in the war since 2016.British parliamentarians, meanwhile, urged the UK to halt weapons sales to a Saudi-led coalition fighting in the country, fearing it was contributing to the humanitarian crisis and numbers of deaths. “The current conflict in Yemen is one of the greatest preventable disasters facing humanity,” the damning UNDP report said. “If that war continues it will continue to disproportionately kill children, mostly due to a lack of access to food, health services and infrastructure. It is already placed among some of the worst conflicts since the end of the Cold War.”
Elite US Navy SEAL facing war crimes charges for killings in Iraq - Stabbing a teenage prisoner to death, picking off a young girl and an old man with a sniper rifle and firing a heavy machinegun into a residential area: these are some of the charges facing an elite US Navy SEAL on trial for war crimes while deployed in Iraq. Special Operations Chief Edward Gallagher, a decorated 39-year-old veteran of combat missions in Iraq and Afghanistan, is still a hero in the eyes of many Americans and the rightwing Fox News channel -- and his case may even become a factor in next year's presidential elections. Around 40 Republican members of Congress have written an open letter demanding Gallagher -- who denies the charges against him -- be set free until he stands trial. One has even called on President Donald Trump to step in and have the case dismissed. Trump has weighed in on the case on Twitter, saying that he had intervened to ensure that Gallagher -- who was nominated for the Silver Star for his service -- "will soon be moved to less restrictive confinement while he awaits his day in court." Trump said the move was made "in honor of his past service to our Country." Gallagher, a platoon commander of SEAL Team 7, will face a military tribunal at a Navy base in San Diego on May 28. He was arrested last September and has been held at the base ever since. He was arrested after men under his command in the elite Navy unit were so horrified by his actions that they complained to their superiors, but were warned that their accusations could damage their careers, according to reports in The Navy Times and The New York Times this week.
It's 2019, Guess Who's Back In Iraq- It's 2019, over 15 years since the US invaded Iraq... so of course the racked with scandal mercenary group Blackwater is back in Iraq. Or rather, Erik Prince's latest among many incarnations of the infamous private contractor firm is back, now Frontier Services Group (FSG), based in Hong Kong. Dubai-based Frontier Logistics Consultancy DMCC, a subsidiary of Prince’s controversial FSG (given its coziness with the Chinese government and gulf monarchies), has been registered as a foreign company with Iraq’s Ministry of Trade, Buzzfeed reported based on new Iraq government documents it obtained. He never goes away. In 2017 he pitched the idea to become "Viceroy" over a "privatized" war in Afghanistan in a WSJ op-ed. And where else would the corporate mercenary foot soldiers of empire be based but Basra, located in Iraq's oil-rich south? Notably it's also close to the border with Iran, in a Shia heartland which last summer saw mass unrest due to electricity shortages and lack of services, blamed on government corruption and "foreign" presence of oil companies. Blackwater had been previously banned from Iraq after contractors opened fire on and killed unarmed civilians in Baghdad in what became known as the Nisour Square massacre. But according to the below document obtained by BuzzFeed, Prince is back, but under a different company name:
US-Led Bombing Campaign in Syria Left Raqqa Most Destroyed City in Modern Times – Study -- An "unprecedented" new study released on Thursday revealed that the U.S.-led bombing campaign on Raqqa, Syria in 2017 — which one military commander at the time claimed was the "most precise air campaign in history" — killed an estimated 1,600 innocent civilians while leveling the city on a scale unparalleled in recent decades.The research collated almost two years of investigations into the assault on Raqqa, the groups said in a statement, and "gives a brutally vivid account" of the enormous number of civilian lives lost as "a direct result" of thousands of coalition air strikes and tens of thousands of US artillery strikes in Raqqa from June to October 2017. The report—"Rhetoric vs. Reality: How the 'Most Precise Air Campaign in History' Left Raqqa the Most Destroyed City in Modern Times"—is detailed on the interactive website created by investigative news organization Airwars and the human rights group Amnesty International-USA which carried out what they call the "most comprehensive investigation into civilian deaths in a modern conflict."The findings confirm that the U.S.-led coalition has admitted to just a fraction of the civilian carnage it has caused in Syria, even as it has boasted of the care it's taken in avoiding such casualties and the precision of the Raqqa offensive.According to the report:US, UK and French forces also launched thousands of air strikes into civilian neighborhoods, scores of which resulted in mass civilian casualties.In one tragic incident, a Coalition air strike destroyed an entire five-story residential building near Maari school in the central Harat al-Badu neighborhood in the early evening of 25 September 2017. Four families were sheltering in the basement at the time. Almost all of them – at least 32 civilians, including 20 children – were killed. A week later, a further 27 civilians – including many relatives of those killed in the earlier strike – were also killed when an air strike destroyed a nearby building. "I saw my son die, burnt in the rubble in front of me," Ayet Mohammed Jasem, one of the few survivors of the later attack, told the investigators. "I've lost everyone who was dear to me. My four children, my husband, my mother, my sister, my whole family. Wasn't the goal to free the civilians? They were supposed to save us, to save our children."
How the U.S. Miscounted the Dead in Syria - United States dramatically underestimated the number of civilians killed in the U.S.-led coalition’s assault on the self-proclaimed capital of the Islamic State two years ago, according to the research of two leading human rights groups. During the four-month campaign to oust the Islamic State from the Syrian city of Raqqa in 2017, some 1,600 civilians died as a result of coalition airstrikes and bombing, Amnesty International and Airwars wrote in a new report. The United States put the civilian death toll in Raqqa at 318, according to a spokesman for the U.S. campaign to defeat the Islamic State. The report, drawing on nearly two years of research, also concluded that the U.S.-led coalition was responsible for a significantly higher number of civilian casualties throughout its four-year campaign to destroy the Islamic State caliphate in Syria and Iraq than it had reported. The U.S. military estimated in February that it unintentionally killed 1,257 civilians in the fighting, which began in 2014. But Donatella Rovera, the Amnesty researcher who led the investigation, estimated that the real number was about 10 times higher. She described the level of destruction in Raqqa as “unparalleled in modern times.” Amnesty and Airwars used open-source data, on-the-ground interviews, and satellite imagery to investigate claims of civilian deaths. Their report underscored the challenge U.S. and coalition forces faced in trying to oust dug-in fighters who used civilians as human shields. But it also questioned whether the air campaign needed to be so aggressive and raised the possibility that the airstrikes might have undermined the U.S.-led coalition’s own goals in Syria and Iraq.
US Troops In Syria For Long Haul Atop A Lot Of Oil Resources - Pentagon Official - A high level Pentagon official has admitted that US forces will be in Syria for "the long haul" and coupled his statement by declaring the territory contains “a lot of the oil resources and arable land.”The unusually frank remarks were made this week by Michael Mulroy, Deputy Assistant Secretary of Defense for the Middle East, while addressing a conference at the D.C. based Center for a New American Security (CNAS), months after President Trump appeared to have caved to his advisers, reversing course earlier this year from his stated goal of a full and rapid US troop exit from Syria. Mulroy said “we have a very capable partner” — in reference to the primarily Kurdish Syrian Democratic Forces (SDF) — and quickly noted the US-trained SDF happens to occupy key regions in eastern Syria with "a lot of the oil resources and arable land," and added that, "we are there with them".The Pentagon official further vouched for the think tank's new feature policy recommendations on Syria which call among other things for continuing to "maintain a presence in over one-third of the country." Referencing the CNAS' new policy report entitled “Solving the Syrian Rubik’s Cube,” regional Iraqi media outlet Kurdistan 24 reported: Nicholas Heras, one of the study’s co-authors, spoke with Kurdistan 24. He explained that of the six scenarios considered in the report, “The option that we supported is that the United States should continue to maintain a presence in over one-third of the country” and “should invest more, both in terms of financial resources and personnel to stabilize” that region of Syria. U.S. is in Syria for the long haul, says Michael Mulroy, Dep Ass Sec for Def. The US is “not in a bad situation” in Syria, Mulroy said, the country has “ a very capable partner,” & the territory contains “a lot of the oil resources & arable land.” https://t.co/X4ajRef49t — Joshua Landis (@joshua_landis) April 30, 2019 Earlier this month the SDF and western coalition forces declared total defeat over ISIS after fully securing the last ISIS holdout town of Baghouz.
Yazidis to accept ISIL rape survivors, but not their children Children born to Yazidi women raped by Islamic State of Iraq and the Levant (ISIL or ISIS) fighters will not be permitted to join the community in northern Iraq, the minority sect's faith leaders have said. In a statement late on Saturday, the Yazidi Supreme Spiritual Council said an earlier declaration stating "all survivors" of ISIL crimes and their children would be accepted in the community did not, as widely interpreted, "include children born of rape, but [instead] refers to children born of two Yazidi parents". Children born of rape by ISIL forces have been the subject of fierce debate in the insular community, which once numbered about 500,000 people and only recognises children as Yazidi if both their parents hail from the sect. It had also long considered any women marrying outside the sect to no longer be Yazidi. But in 2015, a year after ISIL fighters stormed the Yazidi heartland in Iraq's Sinjar region - massacring men and imprisoning thousands of women as sex slaves - Yazidi spiritual leader Baba Sheikh issued a decision welcoming those women back home. And last week, Hazem Tahsin, head of the Supreme Faith Council, issued what appeared to be a landmark shift, publishing an order "accepting all survivors [of ISIL crimes] and considering what they went through to have been against their will". The decision was hailed as "historic" by Yazidi activists, who understood it to mean that children born of rape would be allowed to live among their Yazidi relatives. But the council clarified its position late on Saturday, blaming the misunderstanding on "distortion" by the media. Ali Khedhir Ilyas, a Yazidi official, said on Sunday the council encourages the women to return with their children, no matter the parentage, but added that they "cannot force the families to accept" those born of rape. Human Rights Watch has condemned the council's Saturday decision.
ISIS Releases First Video of Leader Baghdadi Since 2014 — ISIS leader Abu Bakr al-Baghdadi may not have a caliphate anymore, but he’s still got a video camera. The reclusive leader of the group has shown up in a new video message released Monday. It is the first time Baghdadi has been seen in a video since 2014. Baghdadi sought to emphasize that, despite his effective defeat in Syria and Iraq, the group remains active. He promised to see that the group would remain active and fighting until “Judgment Day.” While Baghdadi tried to play up his group being active, not everyone is convinced that the group retains anywhere near the clout it once had. Defense Priorities Policy Director Benjamin H. Friedman issued a statement in response saying: “Abu Bakr al-Baghdadi’s new propaganda video is evidence that he is alive. It is not evidence that ISIS is thriving or that U.S. troops should stay in Syria or Iraq to fight its remnant. “No true military mission is left for U.S. troops in Syria. Baghdadi does not operationally control the so-called affiliates around the world. And ISIS’ losses make others less likely to affiliate in name or to try to travel to Syria or Iraq to fight. The U.S.-led war on ISIS undercut the allure it needs to recruit, inspire, and terrorize. “The U.S. does not need to be at the front of the already-long anti-ISIS line. Baghdadi and ISIS are hidden and hunted by an array of actors: the Kurds who did the hard fighting against them already, the Syrian government, Russians, Iran-backed militias, Iraq, and tribes who were abused by ISIS in its prime. The Pentagon, of course, has been trying to play up the ISIS threat to justify a permanent presence in Syria, and ISIS themselves are trying to ensure that US presence for the sake of their own status as a global terror group of note. It’s an arrangement that benefits US hawks and ISIS, but not much of anyone else.
Jewish-American Activists Beaten and Detained by Israeli Soldiers in West Bank - — Several Jewish-American activists were beaten and forcefully detained by the Israeli army alongside Palestinian and Israeli activists on Friday morning while working to repair a road linking Palestinian villages in the South Hebron Hills.Those forced to the ground and dragged into military vehicles included several who appeared to be rabbis, and several elderly members of the group.The activists were part of a delegation of 42 diaspora Jews from the US and Canada who are on a two-week tour of the West Bank organised by the US-based Center for Jewish Nonviolence (CJNV) to promote Jewish and Palestinian co-existence and to resist the ongoing Israeli military occupation. On Friday morning, the group were participating in a road rehabilitation project alongside Palestinian activists and members of local village councils, and activists from All That’s left, an Israeli anti-occupation campaign group.Almost 100 activists dressed in matching maroon shirts with “End the occupation” written in Arabic, English and Hebrew, were taking part in the activity, which involved filling in trenches and breaking up large stones which had rendered the main road linking 16 villages, an unsurfaced gravel track, virtually unusable.After less than an hour, Israeli military and border control agents arrived on the scene, encircling the group and blocking entry and exist to the road.A 10-minute notice was verbally declared by the military notifying the activists that the road they were working on was now a closed military zone and they must leave or else be arrested.As the activists continued to work after the 10-minute mark, soldiers ran down the hill, targeting the Palestinians activists first.The closest group of international allies immediately formed a circle, locking arms to protect the targeted Palestinians, chanting “Diaspora Jews say end the occupation”.Soldiers then started grabbing activists by their arms, legs and clothes, attempting to pull them away from the huddled circle.Two sound grenades were also thrown towards the group in an effort to make them disperse.The violence lasted for about 30 minutes, resulting in about 10 Jews, three Palestinians and two journalists being grabbed and dragged along the rocky ground and held in military vehicles. Middle East Eye understands that those detained were arrested and taken to Kirat Arba, a settlement near Hebron.
Israel Protests Being Called an 'Apartheid State' -Israel on Tuesday summoned France’s ambassador Helene Le Gal to protest comments by outgoing French envoy in Washington Gerard Araud in which he described Israel as an “apartheid state”. “We strongly protested these words,” Foreign Ministry spokesperson Emmanuel Nahshon said. Earlier this month, Araud described Israel as an “apartheid state” during an interview with the Atlantic magazine. He said Israel was “extremely comfortable” with the status quo “because they have the cake and eat it. They have the West Bank, but at the same time they don’t have to make the painful decision about the Palestinians, really making them really, totally stateless or making them citizens of Israel.” “They won’t make them citizens of Israel. So they will have to make it official, which is we know the situation, which is an apartheid. There will be officially an apartheid state. They are in fact already,” Araud said. Araud had served as the French ambassador to Israel from 2003 to 2006.
Goldman Sparks Erdogan's Fury, Predicts Lira Will Crash To All Time Low In 12 Months - One month ago, on March 22, when the Turkish lira suddenly cracked, and suffered what was then its biggest one-day drop since last summer's crisis as public attention turned to the sudden plunge in the nation's reserves and the bank's unexpected 150bps equivalent tightening in policy, JPMorgan FX strategists poured gasoline on the fire when - as the lira was sliding - they published a note recommending a 5.90 target on the USDTRY.As JPM analysts Anezka Christovova and Saad Siddiqui wrote then, recommending a lira short, Turkish authorities would likely "attach less significance to lira stability and reduce FX reserve support" for the currency following March 31 elections, resulting in further lira weakness, adding that the pace at which Turkey’s burning net foreign reserves is “unsustainable” and therefore “FX reserve support will abate post local elections on March 31, which could lead to USDTRY trading substantially higher."Predictably, it also prompted Erdogan's anger, with Turkey’s banking and capital markets regulators opening separate investigations into JPMorgan Chase the bank's recommendation to short the lira. Desperate to create a scapegoat for the sudden plunge in the currency, which as it turned out had since last summer been artificially propped up by local banks (while the central bank pretended not to intervene and thus misrepresented the true level of its reserves), Turkey delighted at the opportunity to blame the plunge in the lira, which is only just now restarting, on JPMorgan. As a result, the banking regulator BRSA said the JPMorgan analysts’ note had “misguiding and manipulative” content that resulted in volatility in markets and hurt the reputation of Turkish banks, according to state news agency Anadolu. The Capital Markets Board began its own investigation on similar grounds, according to a statement on its website. In the month since then, the lira plunge has only accelerated, and whether the result of JPM's short reco or the fact that the central bank was misrepresenting its reserves by roughly 100%, the lira has since plunged well below JPM's 5.90 target, hitting 5.95 against the dollar on Friday; and so the fury at JPMorgan was promptly forgotten.
Air raids trap civilians in Libyan capital Tripoli - Libyan officials have said that eastern-based forces loyal to renegade military commander Khalifa Haftar have intensified their air attacks around Tripoli over the past two days. Haftar's self-styled Libyan National Army (LNA) launched an operation to take the capital from the UN-recognised Government of National Accord (GNA) on April 4 and has been engaged in fighting with its militias in and around the city. LNA attacks on Monday targeted the Nawasi brigade in the Abu Salim district, located roughly 7km from central Tripoli, officials, who wished to remain anonymous, told The Associated Press news agency. The Nawasi brigade is one of several militias allied with the internationally recognised GNA. The towns of Khallet al-Forjan, Ain Zara and al-Twaisha along the city’s southern outskirts were also targeted. Residents said that fighting continued overnight Sunday in residential areas a few kilometres south of Tripoli. Both sides have used heavy artillery and air attacks, they said. "We cannot move because of the shelling from both sides. Our homes have been damaged. We are trying to leave the area to a safer place," said Mohammed al-Trapoulsi, a 41-year-old father of three from Abu Salim. Reporting from Tripoli, Al Jazeera's Mahmoud Abdelwahed said the LNA had advanced closer to the city centre on Monday. "Forces loyal to Khalifa Haftar have advanced towards Al Sidra neighbourhood, about 15km away from Tripoli's city centre. Eyewitnesses there say they have seen Haftar's forces engaging against forces loyal to the UN-recognised GNA in the streets and in densely populated areas," he said. "In the past two weeks, Haftar's forces were losing ground and the GNA's forces were pushing them back. After they lost ground, Haftar's forces intensified air strikes. The situation remains very tense, especially for civilians living in or near the fighting areas."On Sunday, GNA forces fought house-to-house battles with the LNA, pushing Haftar’s troops further away from the capital.
Taliban Appears To Be Winning Against US-backed Kabul, Finds Pentagon Watchdog - It should come as no surprise to most that the United States' over 18-year long war in Afghanistan is a continual nightmare wrought with endless difficulties, earning America's lengthy post 9/11 quagmire the moniker of "the forever war".But a new Pentagon inspector general report has confirmed the situation to be even worse than commonly perceived: the war to roll back the Taliban is not merely stalled, but there's indicators suggesting jihadist insurgents are actually winning. The report finds Afghan national forces backed by the US have seen a 31% surge in casualties in recent months. The Pentagon watchdog concluded the following, according to Bloomberg:Casualties among Afghan National Defense and Security Forces rose 31 percent from December 2018 to February 2019 over the same period a year earlier, while troop levels fell short again of authorized strength for the first quarter of this year.Further alarming is that after the US-led NATO and western coalition forces have spent nearly two decades attempting to stabilize the country under the government in Kabul, massive swathes of the country are still under Taliban rule, with about 35% of the nation's population still not under the Afghan national government. The assessment by the Special Inspector General for Afghanistan Reconstruction found further that from November 2016 through October 2018, “the Afghan government controlled or influenced between 64 percent and 66 percent of the population.” The dour data points from the assessment come just as the Trump administration is engaged in uneasy negotiations with the Taliban, through special envoy on Afghan reconciliation, Zalmay Khalilzad, hosted in Qatar. Crucially, the report highlights that the US-supported side is not entering talks from a position of strength, but instead Afghan national forces are taking “more casualties as they seek greater leverage at the negotiating table.” “If negotiators fail to secure a peace agreement, the ANDSF will be hard pressed to increase its control over Afghanistan’s population, districts, and territory,” the inspector general said, referring to the the Afghan National Security Forces.
US military stops releasing Afghanistan war information – (AP) — Amid a battlefield stalemate in Afghanistan , the U.S. military has stopped releasing information often cited to measure progress in America's longest war, calling it of little value in fighting the Taliban insurgency.The move fits a trend of less information being released about the war in recent years, often at the insistence of the Afghan government, which had previously stopped the U.S. military from disclosing the number of Afghans killed in battle as well as overall attrition within the Afghan army. The latest clampdown also aligns with President Donald Trump's complaint that the U.S. gives away too much war information, although there is no evidence that this had any influence on the latest decision.A government watchdog agency that monitors the U.S. war effort, now in its 18th year, said in a report to Congress on Wednesday that the U.S. military command in Kabul is no longer producing "district control data," which shows the number of Afghan districts — and the percentage of their population — controlled by the government compared to the Taliban. The last time the command released this information, in January, it showed that Afghan government control was stagnant or slipping. It said the share of the population under Afghan government control or influence — a figure that was largely unchanged from May 2017 to July 2018 at about 65 percent — had dropped in October 2018 to 63.5 percent. The government's control or influence of districts fell nearly 2 percentage points, to 53.8 percent.
Before-and-after photos show how China is destroying historical sites to monitor and intimidate its Muslim minority - China is installing a 21st-century police state in its western frontier of Xinjiang, which is home to the Uighurs, a majority-Muslim ethnic minority. It involves installing hundreds of thousands of facial recognition cameras, making Uighurs download intrusive software on their phones, and holding at least 1 million Muslims in prison-like detention centers. Beijing is waging this crackdown partly because it sees Uighurs as a national security threat, and has tried to stoke Islamophobia to justify its controversial policies in the region. As a part of the crackdown authorities have also been razing historic architecture around the region. Over the past two years, China has started destroying mosques — either by removing various parts, like gatehouses and domes, or by razing the entire structure — around Xinjiang as part of its campaign to marginalize Muslim culture and "sinicize" religion in the country. Scroll down to see before-and-after images of Uighur architecture being destroyed. They are just three of many such examples.
In Pictures: 130,000 protest looming China extradition law, say organisers, after Hong Kong jails Umbrella Movement leaders – with captions - Hong Kong Free Press
Making Sense of China’s Reaction to the French Navy’s Taiwan Strait Transit This week, a spokesperson for the Chinese Ministry of Defense accused France of “illegally entering Chinese waters.” Following this apparent transgression, Beijing withdrew the French Navy’s invitation to participate in the naval parade off Qingdao to commemorate the 70th year of the People’s Liberation Army Navy. Given the nature of China’s complaint, one might think that the French Navy had conducted a freedom of navigation operation through the Paracel Islands, where China has illegally established straight baselines, or through the Spratly Islands, near Beijing’s seven artificial islands. But France’s action was nothing of the sort. Earlier this month, a French warship sailed through the Taiwan Strait—a waterway some 80 nautical miles in width on average. While the move was reported in certain outlets as “rare” for the French Navy, it appears not to have been so. One French official tells the Financial Times that the French navy conducted these sorts of transits annually. China has protested U.S. Navy movements through the Taiwan Strait over the years. These transits have intensified since 2017, in line with the Trump administration’s adoption of a more hardline stance toward China more generally. But unlike the United States, which has a special unofficial relationship with Taiwan under the aegis of the forty-year-old Taiwan Relations Act, France was largely exempt from China’s ire. So why complain about a French transit of the Taiwan Strait now? One reason may be Paris’ growing interest in supporting the United States, Japan, and other regional powers concerned about China in the Indo-Pacific more broadly. France, with its overseas territory, has a population of more than 1 million citizens residing in the region and a massive Indo-Pacific exclusive economic zone of its own. As a result, Paris has in recent years pledged to be more present in the region.
Two US Warships Sail Through Taiwan Strait In Dare To Beijing - With US-China trade talks set to resume this week amid what flashing red headlines, Larry Kudlow and Donald Trump's twitter account remind us every day, if not hour, is a sense of "optimism" about an imminent deal, on Sunday the US navy reminded Beijing to stick to the script (one in which Trump supposedly comes off as a negotiating giant), when it two warships through the hotly contested Taiwan Strait as the Pentagon increases the frequency of movement through the strategic waterway despite vocal and often time angry opposition from China. While the voyage risks further raising tensions with China - at an especially sensitive time for trade negotiations - it will also be viewed by Taiwan as a sign of support from the Trump administration amid growing friction between Taipei and Beijing. According to Reuters, the two destroyers were the William P. Lawrence and Stethem. “The ships’ transit through the Taiwan Strait demonstrates the U.S. commitment to a free and open Indo-Pacific,” Commander Clay Doss, a spokesman for the U.S. Navy’s Seventh Fleet, said in a statement. The 112-mile-wide Taiwan Strait separates Taiwan from China. Winking at China, Doss also said there were no unsafe or unprofessional interactions with other countries’ vessels during the transit. Beijing may beg to differ. Despite an alleged convergence of view on trade between Beijing and DC., Taiwan remains one of a growing number of flashpoints in the U.S.-China relationship, which also include a trade war, U.S. sanctions, the future of Huawei and 5G and China’s increasingly muscular military posture in the South China Sea, where the United States also conducts freedom-of-navigation patrols to remind China that the US will never cede implicit control of the world's most important naval area.
"Warning Shot Across The Bow:" US Warns China On Aggressive Acts By Maritime Militia --Earlier this month, we reported that 275 Chinese fishing militia and Coast Guard vessels surrounded the island of Thitu in the South China Sea, which is currently being occupied by the Philippines. The US recently delivered a stern message to Beijing about its aggression in the highly disputed body of water, announcing that Chinese fishing militia and Coast Guard ships would be treated as military vessels. Admiral John Richardson, head of the US Navy, described how he told, vice-admiral Shen Jinlon of the Chinese People's Liberation Army Navy (PLAN), back in January, that the Trump administration would label the Coast Guard and the maritime militia as military vessels."I made it very clear that the US navy will not be coerced and will continue to conduct routine and lawful operations around the world, in order to protect the rights, freedoms and lawful uses of sea and airspace guaranteed to all," Admiral Richardson told the Financial Times.China’s Coast Guard has more than doubled its feet to over 130 ships in the last decade, making it the largest coast guard in the world. Beijing trains and provides financial subsidies to the maritime militia, an armed reserve force of civilians and fishing boats, has significantly increased in size since 2015.
Washington Warns Beijing: 'Paramilitary' Fishing Boats Will Now Be Treated Like Combatants - As the US continues its increasingly daring and extremely provocative "freedom of navigation" operations in the Strait of Taiwan and South China Sea, it's also growing more vocal about challenging China's increasingly expansionary military presence in the Pacific. Over the weekend, the US has warned Beijing that the US military would aggressively respond to provocative acts by China's coast guard and fishing boats in the same way it reacts to the Chinese navy. The threatening posture is aimed at curbing Beijing's increasingly sharp-elbowed approach not just to the South China Sea, which it already effectively dominates, despite the rival claims of several of its neighbors (claims that have been validated by international courts), but in the Pacific more broadly, the FT reports.Admiral John Richardson, head of the US Navy, said he told his Chinese counterpart, vice-admiral Shen Jinlong, in January that Washington would not treat Chinese fishing boats that work with the People's Liberation Army-Navy any differently from actual Navy ships. This warning wasn't unprovoked: On several occasions, Chinese fishing boats have blocked vessels belonging to the US, Vietnam and the Philippines. They have even rammed and harassed ships, blocked access to lagoons, and participated in the seizure of reefs and shoals."I made it very clear that the US navy will not be coerced and will continue to conduct routine and lawful operations around the world, in order to protect the rights, freedoms and lawful uses of sea and airspace guaranteed to all," Adm Richardson told the Financial Times. China's informal marine militia has been expanding since 2015, when it established a headquarters on the Paracel Islands.
The New Silk Roads reach the next level -Pepe Escobar. The Belt and Road Forum in Beijing was a graphic demonstration of how tactical adjustments are essential to enhance the appeal of a complex overall strategy. Talk about a turbo-charged 4.0 version of the legendary Deng Xiaoping maxim “crossing the river while feeling the stones.” For all the somewhat straitjacket approach of Chinese official pronouncements, President Xi Jinping stressed a sort of “three musts” for the advance of the New Silk Roads, or Belt and Road Initiative (BRI) – debt sustainability, protection of the environment (or “green growth”), and no tolerance for corruption. Add to that a growing battle against trade protectionism, more bilateral free-trade deals, more financing or investments, cooperation on third-party markets, and even a plan to sell Silk Road bonds. In his keynote speech, Xi stressed how multilateral cooperation on “six corridors and six channels serving multiple countries and ports” is all go. He was referring to BRI’s six major connectivity corridors spanning Eurasia – and the fact that BRI is still in its planning stage; implementation actually starts in 2021. The devil, of course, is in the details on multiple Chinese promises – further opening-up of the Chinese market to foreign investment; the possibility of majority equity in more industrial sectors; no more imposed technology transfers; more protection of intellectual property rights; and last but not least, no devaluation of the yuan. And yet Beijing is learning fast. The final joint communique, emphasizing governance as much as economic development, was signed by Xi and 37 heads of state – from Italy, Greece and Portugal to Singapore and Thailand, not to mention new members such as Luxembourg, Peru, Cyprus and Yemen. BRI is now supported by no less than 126 states and territories, plus a host of international organizations. This is the new, truthful, realistic face of the “international community” – way bigger, diversified and more representative than the G20.
Global Semiconductor Sales Collapse 15.5% In 1Q19, Says SIA The Semiconductor Industry Association (SIA) published a new report Monday that shows worldwide sales of semiconductors totaled $96.8 billion during 1Q19, a 15.5% plunge over 4Q18 and a 13% drop YoY.Global sales for March 2019 were $32.3 billion, a 2% decline from February and 13% drop YoY. "Global semiconductor sales slowed during the first quarter of 2019, falling short of the previous quarter and Q1 of last year by double-digit percentages," said John Neuffer, SIA president and CEO. "Sales in March decreased on a year-to-year basis across all major regional markets and semiconductor product categories, consistent with the cyclical trend the global market has experienced recently." Regionally, sales increased in March on an MoM basis in China (1.3%) and Europe (0.60%), but declined in the Asia Pacific (-1.9%), Japan (-4.5%), and the Americas (-6.7%). On a YoY basis in March, sales plunged in Europe (-6.8%), Asia Pacific (-9.3%), China (-9.4%), Japan (-11.1%), and the Americas (-26.6%). In a separate report by 'Things That Make You Go Hmmm' - the YoY percentage growth of global semiconductor revenues has dramatically slowed from 41% in 1994 to less than 4% estimated for 2019. This is a dramatic projected slowdown from last year's 15.9% print, which tells us that the semiconductor 'supercycle' has stalled.
India Raises Import Tax on Wheat to 40% to Support Local Farmers -- India raised the customs duty on wheat to 40 percent from 30 percent, as the country is set for a record rise in output for the third year in a row. The increase in the tax, announced by the Central Board of Indirect Taxes and Customs in a notification dated Friday, will support local farmers, by making imports of the grain costlier. Last year, the government hadincreased the import duty on wheat by 10 percentage points to 30 percent.
Pew Research: Fewer Pray in Islamic Republic of Pakistan Than in India, Iran --Pew Religious Landscape Study has revealed that 67% of the people in the Islamic Republic of Pakistan pray daily. This figure of 67% in Pakistan is lower than neighboring India's 75%, Iran's 87% and Afghanistan's 97%. Other Muslim majority nations surveyed include Nigeria (95%), Indonesia (84%), Egypt (72%) and Turkey (60%). Oil-rich Arabian Gulf nations were not included in the survey. The Pew study found an inverse relationship between daily prayer levels and incomes. Countries such as the United States and Vietnam are outliers.The Pew survey shows that the level of daily prayer is the lowest in rich countries and highest in the poor nations. United States is an outlier rich nation with 55% of Americans saying they pray daily. The survey did not include wealthy Muslim nations in the Arabian Peninsula, such as Qatar and the United Arab Emirates, which might be expected to have high levels of prayer.
Indonesia’s planning minister announces capital city move - Indonesia is moving its capital city away from Jakarta, according to the country's planning minister. Bambang Brodjonegoro said President Joko Widodo had chosen to relocate the capital in "an important decision". The new location is not yet known. However state media reports one of the front runners is Palangkaraya, on the island of Borneo. Jakarta, home to over 10 million people, is sinking at one of the fastest rates in the world. The idea of moving the capital has been floated several times since the country gained independence from the Dutch in 1945. In 2016, a survey found that the mega-city had the world's worst traffic congestion. Government ministers have to be escorted by police convoys to get to meetings on time. The planning minister says snarl-ups in Jakarta costs the economy 100 trillion rupiah ($6.8bn, £5.4bn) a year. Jakarta is also one of the fastest-sinking cities in the world. Researchers say that large parts of the megacity could be entirely submerged by 2050. North Jakarta sunk 2.5m (eight feet) in 10 years and is continuing to sink an average of 1-15cm a year. Media captionWhy Indonesia's capital Jakarta is sinking The city sits on the coast on swampy land, criss-crossed by 13 rivers. Half of Jakarta is below sea level. One of the main causes of this is the extraction of groundwater which is used as drinking water and for bathing.
Factbox: The only way is down - Emerging central banks keep cutting rates (Reuters) - Interest rate cuts by emerging market central banks outstripped rate hikes for a third straight month in April, taking their cue from the dovish turn of major central banks from the U.S. Federal Reserve to the ECB. Interest rate moves by central banks across a group of 37 developing economies showed three net rate cuts in April - the same number as in March and February. The third month of net rate cuts follows a tightening cycle that ended in early 2019 and which saw interest rate hikes by emerging market central banks outstrip or match cuts for nine straight months to battle the fallout from a strong dollar, rising inflation and softer currencies. Graphic: Shifting gears - tmsnrt.rs/2VtMo1c For an interactive version of the above graphic, click here tmsnrt.rs/2VtMl5w. . Below is a list of recent emerging market central bank monetary policy changes:
Sri Lanka Bans Face Coverings in Response to Easter Bombings - — Muslim women in Sri Lanka have been banned from wearing the face veil in response to the Easter Sunday attacks that killed at least 250 people and wounded hundreds more.Sri Lankan President Maithripala Sirisena introduced the face-covering ban on Monday and said it was part of an emergency law to ensure national security in the country.Sirisena’s office added that any face garment which “hindered identification” would be banned automatically. Critics of the ban, however, have said the ban disproportionately targets Muslim women in the South Asian country, where a small minority wear the face veil, or niqab.Sinthujan Varatharajah, an analyst at the democracy advocacy group Open Society Foundation, said the ban made no sense as none of the Easter Sunday attackers wore face veils during the attacks.According to Varatharajah, the Sinhalese community, which makes up the majority of the Sri Lankan population, fear suicide bombers, who were used by the Tamil insurgency between 1980 and 2000. “This is a shortcut response because practically speaking, none of the attackers wore a niqab,” Varatharajah told Middle East Eye.
Father, Brothers Of Sri Lankan Suicide Bombings Mastermind Killed By Police - More than a dozen suspected jihadis (and a few civilians) died during a fierce gun battle on Friday between Sri Lankan police and terror suspects as dozens of suspected ISIS-affiliated jihadis from domestic terror organizations National Thawheedh Jamaath and Jammiyathul Millathu Ibrahim were rounded up in a crackdown meant to stave off any additional terror attacks.According to a Reuters report from Friday, among the 15 dead were the father and two brothers of the mastermind of last week's Easter Sunday bombings, which left 253 dead and another 500 injured. As we reported on Friday, a radical preacher named Zahran Hashim has been identified as the primary architect of the series of bombings at three churches and three luxury hotels. Hashim was a leader of the National Thawheedh Jamaath, and had been arrested over his involvement in the defacing of Buddhist statues. In a series of videos posted to YouTube, the radical Imam had called for violence against all non-believers. In one of these videos, Zainee Hashim, Rilwan Hashim and their father Mohamed Hashim, all of whom were killed by police, could be seen calling for war against nonbelievers. The attack occurred when police raided a suspect terrorist hideout on Sri Lanka's east coast not far from one of the bombings in Batticaloa. A family member confirmed to Sri Lankan police the identities of Hashim's brothers and fathers. As comments from Hashim's sister that circulated in the press suggest, not all of his family members shared his extreme, violent views. "Even if he is my brother, I cannot accept this. I don't care about him any more," his sister said.
Sri Lankan Suicide Bomber Trained With ISIS In Syria, Investigators Say - Despite President Trump heralding the destruction of ISIS at the hands of US and Syrian forces, one of the justifications he cited for ordering US troops to leave Syria (though the administration quietly pivoted and decided to keep some troops on the ground after all), in the wake of the Easter Sunday suicide bombings in Sri Lanka, the group has made its presence felt once again - this time as a decentralized guerilla organization similar to Al Qaeda.On Monday, the group released a video of its founder, Abu Bakr al-Baghdadi, who delivered a call-to-arms and declared the Sri Lankan bombings to be vengeance for the fall of the caliphate. Al-Baghdadi had reportedly been killed several times over the past few years, but intelligence officials were never able to confirm his demise, and apparently, those reports were all premature. And as Sri Lanka remains in a state of high alert following a gun-battle with terrorists on Friday that left 15 terrorists dead, the Wall Street Journal reported Monday afternoon that investigators have determined that at least one of the suicide bombers who carried out the Easter attacks had trained with ISIS in Syria. Others may have traveled to Syria, but are still being investigated.At least one suicide bomber in the Easter attacks in Sri Lanka trained with Islamic State in Syria, people with knowledge of the investigations said, reflecting the extremist group’s continued reach even after the collapse of its self-declared caliphate.Investigators said Jameel Mohammed Abdul Latheef had planned to blow himself up at a luxury hotel, Taj Samudra, in the capital Colombo around the same time Easter morning that other attackers detonated explosives strapped to their bodies at three other top-end hotels and three churches. But they believe Mr. Latheef’s device malfunctioned. He blew himself up outside a small inn, killing himself and two other people.
Sri Lanka attacks: why the wealthy and successful become suicide bombers - In the aftermath of the devastation of the Easter Bombings in Sri Lanka that killed more than 250 people, there has been widespread shock that two of the nine suicide bombers were the children of a millionaire spice merchant who grew up in luxury. Several of the bombers had studied abroad and their career prospects seemed bright. This is not unusual. Psychologist Marc Sageman, writing about al-Qaeda, called terrorism a middle-class phenomenon. A 2016 Brookings Institution study showed that roughly 70 per cent of global recruits for Islamic State were middle class or wealthier. This is the trend we are seeing now across Asia. Terrorist groups are ideological vanguards, usually far out ahead of their societies on issues that justify their violence. They tend to see the state as inherently violent towards their community, unwilling to defend their interests, or holding back the application of sharia law. Terrorists benefit from provoking a heavy-handed response from the state, that in turn vindicates them in the eyes of their constituents. But the same groups are also representative of their societies with recruits from across the socio-economic and educational spectrum.We have the tendency to assume that terrorists engage in acts of violence against soft targets out of weakness; they conduct asymmetrical violence because they lack other means. At the same time, we often assume that terrorists are marginalised and dispossessed, and as such they have nothing to lose. In this logic, terrorism is simply a rational choice. But that hypothesis ignores ideological motivation, and the concept of martyrdom, which necessarily entails sacrifice.
Venezuela crisis: Security forces personnel stranded in Colombia (news video) It's not going according to plan for around a thousand military and security force personnel who defected from Venezuela.They crossed the border into neighbouringColombia two months ago, answering the opposition's call to defect.Venezuela's opposition said that it was unprepared for the numbers of military personnel that defected back in February and a struggling to come up with a plan to support them in the long term.Meanwhile, the families of defectors have received death threats and have been forced to flee, as well, while the defectors wait for a call or an end to the political stalemate.Al Jazeera's Alessandro Rampietti reports.
Ambassadors designated by Venezuela’s Guaido meet in Colombia on winning over China and Russia (Reuters) - Ambassadors designated by Juan Guaido, the Venezuelan opposition leader recognized by most Western nations as the country’s president, are meeting on Saturday in Colombia to discuss how to win the support of China and Russia, staunch allies of President Nicolas Maduro. More than a dozen ambassadors from Latin America and the United States, gathered at a hotel in Bogota, will analyze the next stage they hope will lead Maduro and his military supporters to stand down. The plan will aim to convince Russia and China to back Guaido, the former head of Venezuela’s National Assembly living in Colombia, Julio Borges, told Reuters. “The strategy means to bring countries like Russia and China closer to being part of the solution,” said Borges, an adviser to Guaido and his ambassador to the Lima Group regional bloc. Guaido has been recognized by the United States and most other Western nations as the South American country’s rightful leader. The oil-rich country is in a sixth year of a recession marked by hyperinflation and shortages of basic goods, conditions that have prompted more than 3 million to flee, many to Colombia. Colombian Foreign Minister Carlos Holmes Trujillo said progress has been made and that it is a just question of time before Maduro leaves office.
Venezuela Celebrates Split With OAS — The government of Venezuelan President Nicolas Maduro Saturday staged a rally to celebrate its split with a key regional forum, the Organization of American States. Supporters of Maduro attended the demonstration in the Venezuelan capital to denounce the 35-member OAS, whose council voted this month to recognize an envoy selected by opposition leader Juan Guaido. A minority of countries voted against the resolution. In 2017, Maduro started a two-year process to abandon the OAS, but Guaido this year asked the group to ignore the socialist leader and instead designate Gustavo Tarre as his own envoy. The U.S. and most other OAS member states recognize Guaido as Venezuela's interim president, saying Maduro wasn't legitimately re-elected last year. Maduro says the OAS is violating Venezuela's sovereignty. Also Saturday, ambassadors appointed by Guaido to represent him in the region gathered in Colombia to discuss ways to increase diplomatic pressure on Maduro, who retains the support of Venezuela's military leadership and counts Russia and China among his allies. One of Guaido's envoys, Julio Borges, said they planned to hold a similar event for opposition envoys in Europe in May. The Venezuelan opposition is preparing for nationwide marches May 1 that it hopes will weaken Maduro's hold on power in a country whose economy has been shrinking for years. The opposition blames Venezuela's problems on corruption and mismanagement under Maduro and his predecessor, Hugo Chavez; supporters of Maduro say U.S. sanctions and other measures to isolate them are driving the crisis.
Venezuelan Government Announces Arrests over Electrical Blackouts – Venezuelan authorities have arrested five people in connection with the recent electrical outages in the country, Communications Minister Jorge Rodriguez told press Tuesday.Among those arrested is Otoniel Ramos Sanchez, ex-director of automatization, technology, information and telecommunications at one of the subsidiaries of state-run electrical corporation CORPOELEC in Bolivar State, where the electrical problems of March 7-12 and March 25-29originated. Ramos Sanchez had allegedly been suspended by CORPOELEC two years ago.“The investigations concerning the cyber attacks in the Guri Hydroelectric Complex [in Bolivar State] are advancing,” Rodriguez told reporters. “[Sanchez] has been charged already, is currently answering questions and has given us a lot of information about his accomplices,” he went on to say.Venezuela’s government claim that the initial national blackout of March 7, which left some parts of the country without power for as long as five days, was a result of a sophisticated cyber attack against Guri’s automatized system, allegedly originating from the US cities of Houston and Chicago.The second major outage, which started on March 25, was blamed by Venezuelan authorities on a sniper, who allegedly caused an explosion and fire in the Guri Dam’s switchyard. The Guri Dam currently supplies over 70 percent of Venezuela’s electricity. President Maduro was quick to blame “US imperialism” for both of the attacks.Apart from the five arrests, Rodriguez indicated that a further fourteen people have been implicated in the attacks, and are currently being sought by authorities.Among those named by the minister are Julio Acuña Núñez, who is believed to have fled to the USA, Ramon Garcia, who reportedly lives in Spain, and Miguel Angel Freitas, who allegedly works for a cybersecurity firm in Colombia. Rodriguez also drew special attention to Jesus Landoni, claiming he left Venezuela on April 8 en route to the US and currently lives in a US Air Force official’s house. Landoni was in charge of security at the Guri Complex at the time of the blackouts. “There are Interpol arrest warrant requests issued for those people implicated in the attack, who live in the US, Colombia and Spain,” Rodriguez informed.
Guaidó launches abortive military coup in Venezuela - A coup attempt launched Tuesday morning in Venezuela, distinguished by the brazen criminality of the US government in supporting and orchestrating it, appeared to have failed miserably by nightfall. The attempt was launched with the posting of a video by the US-backed right-wing puppet Juan Guaidó, backed by a few dozen men in military uniform outside the La Carlota air base in Caracas, calling for the military to rise up against the government of President Nicolás Maduro. While the attempt led to violent street clashes and rival demonstrations by supporters and opponents of Maduro, it provoked no significant military revolt. Coming more than three months after Guaidó, on January 23, proclaimed himself the country’s “interim president,” an action directly coordinated with and immediately supported by Washington, Tuesday’s coup attempt took place amid flagging popular support for the right-wing opposition that has served as the political base for the US regime-change operation. By late Tuesday, no military base had been taken by the opposition and no major figure in the Venezuelan armed forces had declared support for Guaidó. While the “interim president” had picked the La Carlota air base as the backdrop for his video, there was no indication that any personnel there were supporting his provocation. The choice of the base was determined, rather, by its proximity to the wealthiest districts of eastern Caracas, the traditional base of the right-wing opposition.
Venezuela crisis- Defiant Maduro claims victory over Guaidó 'coup - Venezuela's President Nicolás Maduro says he has defeated an "attempted coup" by opposition leader Juan Guaidó. Dozens of National Guardsmen sided with the opposition in clashes on Tuesday that injured more than 100 people. But in a defiant TV address, President Maduro said Mr Guaidó had failed to turn the military against him. Mr Guaidó insists that Mr Maduro has lost control of the armed forces. The opposition leader called for more streets protests on Wednesday. "Today we continue," he tweeted. "We will keep going with more strength than ever, Venezuela." Mr Guaidó has been recognised as interim leader of Venezuela by more than 50 countries, including the US, the UK and most in Latin America. The US reiterated its support for Mr Guaidó on Wednesday, with Secretary of State Mike Pompeo saying "military action is possible" if necessary. But Mr Maduro, backed by Russia, China and the top of the country's military, has refused to cede leadership to his rival.
Negative-Yielding Bonds Are Breaking Records (And Why That's A Bad Thing) - The practice of stashing wealth in places where it yields nothing (and maybe even costs a bit for storage) is more common than you might think. Chinese, Russians, and Brazilians, for instance, buy US and Canadian condos and leave them empty as a way of moving their money beyond the reach of their rapacious governments. The taxes and condo fees produce a negative return, but most of the original investment will be there when needed. Other people store gold and silver in overseas vaults, paying 1% or so each year in fees. As the saying goes, such people are more concerned with return of capital than return on capital.Even so, the spread of this kind of attitude beyond a small group of rich-and-worried is a sign of potential trouble. Which is why the surge in negative-yielding European bonds is worth watching.In a healthy economy with lots of profitable opportunities, few investors have an interest in, say, a government bond yielding -0.3%. Europe is clearly not that kind of place anymore, as the outstanding amount of negative-yielding government bonds is up by 20% this year to about $10 trillion. That’s the highest since 2016, when the ECB was depressing rates by snapping pretty much every available eurozone sovereign bond. Now QE has been scaled back but interest rates are still plunging. And it’s not just government bonds. Brand-name European companies like Sanofi SA and Moet Hennessy also have outstanding bonds that trade with negative yields.Clearly, growth is slowing in Europe and investors are scrambling to protect their capital against the coming wave of defaults. Negative yields during an expansion (this one is now 10 years old and counting) deprive central banks of the ability to cut rates to fight the next recession. Yes, a -0.4% lending rate can be cut to -1% and maybe even -2%, but somewhere down there is a line that can’t be crossed – that is, a rate where the unintended consequences make the cure worse than the disease. We don’t know where this line resides, but we’re liable to find out in the next downturn.At that point it’s not clear that fiscal policy — bigger government deficits and more central bank asset purchases — will be enough to stop the downward momentum. If they’re not, then it’s game over for the world’s hyper-leveraged economies.As a Deutsche Bank economist put it recently, “It’s just not a great starting point to already have negative interest rates … It’s getting more and more difficult for policy makers to respond to headwinds.”
Yellow Vests Ignore Macron's 'Olive Branch' As Protests Resume Across France - Yellow Vest activists completely ignored French President Emmanuel Macron's 'olive branch' of compromises - taking to the streets of Paris and other French cities for the 25th straight weekend of protests, albeit in much smaller numbers than in previous weeks. Meanwhile, in France..... pic.twitter.com/zljLcs1Lxm — Paul Joseph Watson (@PrisonPlanet) April 27, 2019 Tear gas was fired at protesters who attempted to march toward the European Parliament building in the eastern city of Strasbourg.#GiletsJaunes : manifestation nationale à #Strasbourg Un nouveau face-à-face tenduLe point avec @Charlinehurel sur #La26 > https://t.co/vVbnZul2rd pic.twitter.com/HZkOf3lcsU — LCI (@LCI) April 27, 2019Around two thousand protesters had gathered near the seat of European Union institutions in Strasbourg, where organizers had planned make the protest international by symbolically marching to the parliament building, a month ahead of EU-wide parliamentary elections. -Reuters French police clash with #YellowVest protesters in Strasbourg https://t.co/Xl2MjFD6R8 pic.twitter.com/Omveu3zSdD— ST Foreign Desk (@STForeignDesk) April 27, 2019 In Paris, meanwhile, a joint demonstration with the hard-left trade union confederation CGT was mostly calm.
Tipping Point: The Gilets Jaunes are winning, what’s next? - The weekend just gone, Manifestation 23, marked a seismic shift in the five month battle between the Gilets Jaunes and the French state. The Notre Dame fire has brought into the open the strategic shift in public opinion that has occurred over the winter; shifts all to the advantage of the Gilets Jaunes. While the cold winter months with their looming darkness only allowed us to glimpse two equal parties grinding away at each other in the gloom, the advent of spring and its clear light, reveals how the Gilets are gathering reserves of strength all over France, and how, now, they are slowly winning in Paris as well. The sight of French police surrounding Notre Dame and denying access to its ‘own’ population, starkly illustrates what the state seeks to deny. After all, these sort of monuments are the materiality through which states demonstrates their connection to the population, their right to rule and their own power.The Neo-liberal state is crumbling and Macron is going be the sacrificial lamb. At this stage he will be lucky to last two months. His clumsy handling of the Notre Dame blaze has outraged and enraged more sections of the French population. Indeed throughout the five months of protest, and despite the wall to wall media propaganda, opinion polls consistently show continued and unwavering sympathy and support of the Gilets Jaunes.In the sharp light of spring it is clear that Macron’s winter strategy: the Great National Debate, has achieved nothing for the government and more tellingly perhaps, has further revealed Macron’s own incapacity to either change himself or shift course. As one anonymous French state official reportedly said: ‘Mitterrand gave them an extra week’s holiday, but Macron can’t manage anything’. He simply seems unable in any form to communicate with either the Gilets or the people of France. His constant speeches, with their casual insults and lack of empathy, remain one of the best recruitment tools the Gilets possess. His recent pronouncements continue this trend. His promise to rebuild the cathedral in five years was met with scorn – ‘this is not a railway line’, said one commentator, while his invitation to the world (a typical empty gesture) angered and aroused traditionalists. Indeed, as has been widely reported, his endorsement of cash donations from billionaires, simply provided the Gilets with yet more free sticks to beat him and the state.
May Day: Police rampage in Paris as hundreds of thousands march in France - As over 310,000 people marched in France for May Day, the international holiday of the working class, riot police launched a brutal and bloody crackdown in Paris. Trade unions as well as “yellow vest” protesters demanding the ouster of President Emmanuel Macron, the “president of the rich,” organized rallies in cities across the country. In the run-up to May Day, the government issued bellicose warnings that Macron had called for “an extremely firm stance” against any sign of violence by protesters. The Paris police prefecture placed much of the capital city in lockdown: the Champs-Elysées avenue where “yellow vest” protests had been held; the ministry district across the river from there; the neighborhood of the burnt-down Notre Dame Cathedral; and the area around the main May Day march in Montparnasse. Large parts of the Paris metro network were closed. Ultimately, however, the violence came mainly from an indiscriminate police rampage in Paris, ostensibly aimed at “black bloc” protesters but that targeted peaceful demonstrators, journalists, and union officials. Further proof of the essentially nonviolent character of protests by “yellow vests” and broader layers of workers came from the provinces. Mass marches in Toulouse, Bordeaux, Marseille and other cities overwhelmingly proceeded peacefully. Police charged the front of the May Day rally in Paris around 1:00 p.m., however, as the roughly 40,000 protesters were about to leave Montpartnasse to march towards Italy Square. After clashes broke out between police and several hundred “black bloc” members, police attacked the entire rally, shooting heavy clouds of tear gas at the protesters and carrying out mass arrests.
Spanish voters put Socialists in pole position to regain power (Reuters) - Spain’s Socialist prime minister, Pedro Sanchez, emerged from inconclusive elections on Sunday with a strong chance to regain power, though he faces weeks or even months of negotiations to assemble a government from a deeply divided new parliament. In one of the country’s most hotly contested elections in decades, the rise of nationalist party Vox split the right-wing vote, echoing fragmented parliaments across Europe where traditional groups have ceded to anti-establishment upstarts. Spaniards cast their votes in numbers close to record highs with campaigning dominated by national identity and cultural values like women’s rights rather than the economy. This is the third national election in four years, after the first two eroded the decades-long dominance of the two biggest parties, the Socialists and the conservative Popular Party. Neither the rightist or the leftist political bloc held a clear majority, according to a tally of results from the Interior Ministry with 80 percent of votes counted. By party, Sanchez’s Socialists led with 123 seats in the 350-seat parliament. The mainstream conservative People’s Party (PP) stood at 65 seats, centre-right Ciudadanos (‘Citizens’) at 57 seats, far-left Unidas Podemos at 42 and far-right Vox at 24. Supporters gathered outside the Socialist headquarters in Madrid chanting ‘Long live Spain’ and ‘Long live Socialism’. There was speculation before the election about a possible coalition between the Socialists and Ciudadanos despite both parties’ leaders ruling out any tie-up. If they were to forge an alliance, their parliamentary majority would mean that Sanchez would not have to seek the support of regional parties favouring Catalan independence.
Spanish PM’s Socialists win snap polls marked by far-right gains - Spanish Prime Minister Pedro Sanchez's Socialists have won snap elections without the necessary majority to govern solo in a fragmented political landscape marked by the far-right's entry into parliament. The results raise the spectre of another period of instability for Spain, with Sanchez depending on alliances with hostile rivals in an environment that has soured since Catalonia's failed secession bid in 2017. A significant development was the rise of the ultra-nationalist Vox party, which garnered just over 10 percent of the vote in a country that has had no far-right party to speak of since the death of dictator Francisco Franco in 1975. Sanchez's Socialist Party (PSOE) got 123 lawmakers out of 350, or close to 29 percent of votes -- short of an absolute majority but much better than the 85 seats it got in 2016. "The Socialists have won the general election and with it the future has won and the past has lost," he told cheering supporters from the balcony of the party's headquarters in Madrid, claiming victory late Sunday. The big loser was the conservative Popular Party (PP), which bagged 66 seats compared to 137 in the previous election that saw it govern Spain with a minority government. Sanchez, who came to power in June after ousting conservative prime minister Mariano Rajoy in a no-confidence vote, could seek to forge alliances with far-left Podemos and smaller groupings like Catalan separatist parties, as he had done over the past 10 months. He could also try to cosy up to centre-right Ciudadanos, which won 57 seats. Together, they would form an absolute majority but voters from both parties would likely frown on such a move.
Lockheed Exec Blasts Germany's "Retrograde Step" Of Refusing F-35 Jet - American defense contractor giant Lockheed Martin has blasted Germany over its refusal to buy its F-35 stealth fighters, in the latest row over the future of NATO defense readiness. In early February it was confirmed that Germany snubbed Lockheed's cutting edge and expensive joint strike fighter, knocking the American stealth fighter of out of a tender worth billions of euros, as Germany's military considers how to replace its aging Tornado warplanes, for which Boeing's F/A-18 Super Hornet and Airbus' NATO Eurofighter Typhoon remain prime alternate contenders. Lockheed Martin’s vice president for Europe, Jonathan Hoyle, told FT that knocking the F-35 out of contention will only hold Germany back in terms of ability to keep pace with NATO readiness. Hoyle described a resulting situation in Europe where “Germany’s position going forward” has been questioned, citing personal conversations with diplomats. These conversations revealed deep “disappointment” with the further criticism that “Germany, which has the biggest defense budget, has just taken this retrograde step and isn’t going to be there”.“So when we go off and collaborate together operationally, if you are flying stealth, fifth-generation jets, you don’t want a fourth-generation jet in the middle of your operations because everyone can see that”, he told FT. The Lockheed executive still touted Europe as a "key area of growth," however, especially Poland, which has recently vowed to increase its defense spending. Multiple reports since the German Defense Ministry's decision earlier this year have described it as a major setback for Lockheed: The decision was seen as a big setback for Lockheed, the top US arms maker, which had hoped to add to recent F-35 sales to other European countries, including Belgium. Its European vice-president Jonathan Hoyle said Berlin’s failure to opt for the F-35 had raised concerns among allies and prompted the question: “What does it mean for NATO?”
Juncker Rips US Stance On Huawei- EU Won't Ban Firm Just Because It's Chinese --European Commission President Jean-Claude Juncker has said he won't bow to US pressure over Huawei, saying that he won't block the telecom giant from doing business in Europe merely because it's a foreign or specifically Chinese firm, so long as it plays by the rules. Speaking alongside Japanese PM Shinzo Abe on Thursday, Juncker told reporters, "We are not rejecting someone because he is coming from faraway, because he is Chinese, the rules have to be respected." Amid Washington's demands that Huawei be barred from Europe's 5G buildout over suspicious it uses its equipment and network to provide a backdoor for Chinese state spying on the West, Juncker pushed back, saying further, "The European Union and our internal market are open markets and all those respecting our rules governing this internal market are welcome." A Japanese reporter had asked the European and Japanese leaders, "the U.S. is calling on the allies to eliminate telecom equipment of Chinese companies including Huawei, so what did you discuss about that? And on this issue, what do you plan to deal with at G20?" The Japanese PM had responded to the question in a less direct manner: "We did not talk about specific countries or specific products. Dealing with cyber-security-related risks is extremely important, and we agree that we need to take coordinated actions at G20," Abe said, according to Xinhuanet. Japan has recently banned Huawai 5G technology and equipment from being implemented in its territory. Currently, the US, Australia, New Zealand, and Japan maintain blanket bans on the Chinese company's technology from being sold or implemented in their countries. And other so-called "Five Eyes" intelligence sharing countries the UK and Canada are reportedly strongly considering a ban.
Bloomberg alleges Huawei routers and network gear are backdoored - Vodafone, the largest mobile network operator in Europe, found backdoors in Huawei equipment between 2009 and 2011, reports Bloomberg. With these backdoors, Huawei could have gained unauthorized access to Vodafone's "fixed-line network in Italy." But Vodafone disagrees, saying that while it did discover some security vulnerabilities in Huawei equipment, these were fixed by Huawei and in any case were not remotely accessible, and hence they could not be used by Huawei.Bloomberg's claims are based on Vodafone's internal security documentation and "people involved in the situation." Several different "backdoors" are described: unsecured telnet access to home routers, along with "backdoors" in optical service nodes (which connect last-mile distribution networks to optical backbone networks) and "broadband network gateways" (BNG) (which sit between broadband users and the backbone network, providing access control, authentication, and similar services). In response to Bloomberg, Vodafone said that the router vulnerabilities were found and fixed in 2011 and the BNG flaws were found and fixed in 2012. While it has documentation about some optical service node vulnerabilities, Vodafone continued, it has no information about when they were fixed. Further, the network operator said that it has no evidence of issues outside Italy. The sources speaking to Bloomberg contest this. They claim that the vulnerabilities persisted after 2012 and that the same flaws could be found in Vodafone-deployed Huawei equipment in the UK, Germany, Spain, and Portugal. In spite of this, Vodafone continued to buy equipment from the Chinese firm because it was so cost competitive.
Labour to decide on Brexit public vote on Tuesday, says Corbyn - Labour’s ruling body will decide on Tuesday whether the party will campaign for a public vote on any Brexit deal, Jeremy Corbyn has said on the campaign trail in leave-voting Peterborough. Almost 90 Labour MPs and MEPs, including a number of frontbenchers, wrote to the party’s National Executive Committee (NEC) to demand that its European election manifesto include a “clear commitment to a confirmatory public vote on any Brexit deal”. However, Corbyn declined to guarantee the commitment. He stressed that he was not a dictator and that the matter would be for the NEC to decide. “The national executive will decide on Tuesday what will be in the European election manifesto, and we will reflect the decisions made [at] last year’s Labour party conference, which were for a customs union, market access and rights protection within – with – the European Union,” he said. “We would prefer to have a general election, but failing that, if we get that agreement, we are prepared to consider putting it to a confirmatory vote. That is a decision the national executive of the party will make. “It’s important that the party, which is a democratic party structure, makes those decisions. Sadly – or perhaps it’s a good thing – I’m not a dictator of the Labour party.” Corbyn’s visit to the east of England comes amid an internal row over the wording of a draft Labour election leaflet. A number of pro-EU Labour MPs were angered by the absence of a reference to another referendum. On Saturday afternoon, the BBC reported that the leaflets would be reprinted to refer to Labour’s preparations for a general election, with a referendum if necessary to avoid what it calls a “bad Tory deal”.
No 10 begs leadership rivals to lay down arms until the PM has secured Commons approval for her Brexit deal Downing Street is urging Tory leadership rivals to stop jostling to succeed Theresa May until the Prime Minister has secured Commons approval for her Brexit deal. Chief Whip Julian Smith is begging the main contenders to ‘lay down their arms’ in the national interest and concentrate instead on persuading diehard Brexit ‘Spartans’ to back Mrs May’s deal – and avert the humiliation of being forced to contest the European elections next month. Mr Smith, who has arranged a series of one-to-one meetings with the contenders over the coming days, is prioritising Brexiteers such as Boris Johnson and Dominic Raab, who he believes stand the best chance of persuading the ‘Spartans’ to drop their opposition. Others include Foreign Secretary Jeremy Hunt and Home Secretary Sajid Javid, who supported Remain in 2016 but now back Brexit. It is understood Mr Smith has already met Mr Johnson, who has abandoned his long-standing opposition to the deal, to plead with him to do ‘everything in his power’ to convert the opponents. The former Foreign Secretary was canvassing for the Tories in the West Midlands yesterday – and managed to find time to pose for photos with supporters. A senior Government source said: ‘Julian does not think that now is an appropriate time for the rivals to be eyeing the prize.
Brexit: Labour hints at backing deal without referendum - Labour is prepared to back the government’s Brexit deal without the promise of a second referendum, one of the party’s chief negotiators has hinted, causing deep alarm among the predominantly Remain-supporting membership. The talks between Labour and Theresa May’s team, which began last month, have “prompted clashes”, says Politics Home, with shadow Brexit secretary Keir Starmer accusing the prime minister of refusing to budge on her red lines, while May accused Labour of “dragging its feet” in order to force Britain to take part in EU elections next month. Yet despite widespread belief in Westminster that cross-party talks are doomed to failure, the shadow business secretary Rebecca Long-Bailey insisted negotiations have been productive and “gone into a lot of detail”. She hinted that the government was signalling a willingness to compromise on some issues, including workers’ rights. Asked by Sky News’s Sophie Ridge whether a second Brexit referendum was a “red line” for Labour in the talks, Long-Bailey said: “I wouldn’t couch it in terms of a second referendum, but our party policy has always been that firstly we want to get a Brexit deal that puts our economy and living standards first and protects our environmental protections, workplace protections, health and safety standards. “If we don’t get a deal that satisfies those objectives – if it’s a damaging deal, a damaging Tory Brexit deal, or there’s a risk of us moving towards a no deal – in that circumstance, we’ve said that all options should be on the table, and that includes campaigning for a public vote.” The Guardian suggests that “her careful recital of the party’s conference motion will infuriate MPs and activists pushing for Labour to make a referendum a central part of its policy platform for next month’s European parliament elections”. The was widespread anger last week after a draft campaign leaflet, believed to have been drawn up Labour leader Jeremy Corbyn’s team without consulting the rest of the shadow cabinet, made no mention of a second referendum. Labour’s manifesto for the European elections is due to be agreed at a meeting of the ruling National Executive Committee (NEC) tomorrow. Ahead of the meeting, 90 MPs and MEPs wrote to Corbyn urging him to ensure a confirmatory vote is part of the package Labour offers to voters in May.
Brexit: Wales’ first minister refuses to back another vote - BBC - Wales' first minister has refused to back a promise to hold another Brexit referendum as part of Labour's manifesto for May's European elections. Labour is redrafting European election leaflets after accusations of ignoring a pledge to hold another vote on leaving the EU, the BBC has been told. About 100 Labour MPs and MEPs want such a promise in the party manifesto. Mark Drakeford said he thought a confirmatory referendum should "remain part of a mix" in the manifesto. UK Labour leader Jeremy Corbyn said Labour's ruling body would make a decision on Tuesday about backing a public vote on any deal. There has been growing calls within the party, wanting Labour to make a "clear commitment" to a public vote on any Brexit deal. It had been reported that Labour's leaflets for the 23 May European Parliament elections do not mention pushing for another referendum. The updated Labour European election leaflets will now refer to the party's preparations for a general election, with a referendum if necessary to avoid what it calls a "bad Tory deal".
Could Brexit Unite Ireland At Last? - A century ago, Ireland’s War of Independence against Britain—the equivalent of the Revolutionary War in colonial America—erupted. It would last 17 months, only to descend afterwards into the year-long Irish Civil War. Even after it came to an official end in 1923, no full and lasting peace was achieved. Rather, the island was permanently partitioned into north and south and plunged until the end of the century into a state of intermittent guerrilla warfare and terror that pitted anti-partition republicans against pro-partition (and pro-British) unionists. The long-cherished dream of “a united Ireland” would remain no more than that. That dream has been held by millions of Irishmen for centuries. Countless revolutionaries and republicans have hungered, thirsted, dreamed, and died for it. From the heroic Wolfe Tone in the 1798 Irish Rebellion to the charismatic political leader Charles Stewart Parnell in the 1880s, to three-time prime minister Eamon de Valera in the 20th century, Irish leaders have awaited the day when their isle would once again be united as one. That day may now be approaching—and by a surprising route, a development completely unforeseen a year ago. What has changed? It is a bizarre six-letter neologism: Brexit. Illustrating what could be termed the First Great Law of History, namely the Law of Unintended Consequences, the specifics of the Brexit agreement may drive two uneasy political bedfellows—the Catholic majority of the Republic of Ireland in the south and the Protestant majority of Northern Ireland—into each other’s arms. As it reaches the centenary of its first historic declaration of independence from Britain, Ireland may be headed for unification—that is, full independence for all 32 Irish counties, including the six in Northern Ireland. None of this is obvious—or inevitable. The devil is in the details. In the aftermath of “Brextension”—the April 11 agreement between the European Union and United Kingdom for a six-month Brexit delay, pushing the withdrawal deadline to Halloween—the UK now has breathing room. The clock has been stopped on a no-deal withdrawal, which would have happened the day after the agreement was signed. But it comes with strings attached, including a strict “no sabotage” clause for the duration of the UK’s membership in the EU and a “review” by EU members of both the UK’s progress towards Brexit and its cooperation with major EU initiatives. Britain must participate in the EU Parliament elections in May. It must assent to a “gentleman’s agreement” that it will abide by its obligations as a member state and not exploit Brextension to block EU goals, generate conflicts, or otherwise undermine the Union’s fragile unity.
‘Danger of doing a deal’: Hunt warns May Brexit agreement with Labour could alienate more Conservative MPs -- Jeremy Hunt has warned Theresa May that a Brexit deal forged with Labour could be even less popular with Tory MPs than the one they have already rejected. The Foreign Secretary told The Telegraph that the cross-party talks risked alienating Conservative MPs so that “you lose more Conservative MPs than you gain Labour MPs”. He said he did not expect talks with Labour to lead to a “rose garden moment” as he questioned whether Jeremy Corbyn was “serious about delivering Brexit”. He said: “By all accounts, while they [the talks] have been more detailed and productive than we thought and expected, it’s still going to be very difficult to imagine a rose garden moment”, referring to the coalition press conference David Cameron and Nick Clegg gave after the 2010 election. “There is always a danger of doing a deal with Labour that [means] you lose more Conservative MPs than you gain Labour MPs, but I think the essential question is whether Labour are serious about delivering Brexit.” Sir Keir Starmer, the shadow Brexit Secretary, on Monday said he wanted to “pin down” the Government on what changes it was willing to make. But Mr Hunt pointed to the splits over Brexit within the Labour Party, saying: “Labour has got hard Remain MPs in large numbers and they’ve got MPs from Leave-voting constituencies in large numbers. That is a fundamental problem for Labour in coming to any position on Brexit.” Speaking in Accra, Ghana on the second day of his week-long tour of Africa, Mr Hunt also said this week’s local elections will be “incredibly challenging” for the Tories, adding: “My heart goes out to local councillors who may suffer as a result of politicians in Westminster failing to deliver.” Mr Hunt, a leading contender to replace Theresa May, warned against holding a Tory leadership contest before securing a Brexit deal with the EU as he said it is “dangerous to think there’s any silver bullet” from changing Prime Minister. He said: “The process of a Tory leadership election would inevitably involve candidates setting out their red lines which might itself mean that finding a compromise to get Brexit over the line becomes harder.”
UK Donors Abandon Conservatives In Favor Of Brexit Party, 'Right To Vote'As rank-and-file Tory members conspire to finally oust Theresa May from No. 10, the party is facing a donor rebellion that will restrict its ability to campaign during the upcoming EU Parliamentary vote, and also leave it in a difficult position if the opposition succeeds in its push for a general election.Donors from the business community, who in the past have been a significant source of financing for the Tories, are abandoning the party and instead donating to either campaigns for a second Brexit referendum, or Nigel Farage's Brexit Party (which is leading the Tories in the EU Parliament elections polls) or Boris Johnson's leadership campaign, according to Business Insider. The shortage of funds has reportedly left the Tories with just £1.5 million ($2 million) in the bank.The situation has grown so dire that the CEO of the party, Mick Davis, has reportedly been forced to dip into his own pockets to cover some of the costs of the upcoming EU Parliamentary vote. He has reportedly told MPs that supporters have refused to donate because of the infighting over Brexit, which has threatened to tear the party apart."There’s a lot of money sloshing around, but most of it isn’t going to the Conservatives," said one source who spoke with BI. "The conservative party is struggling because people don't think they're delivering on their promises," another said.The support for another referendum comes as Labour has reportedly re-committed to supporting a second referendum if they can't secure a general election."Donors have identified other vehicles for their particular cause. If you’re a hedge fund manager who’s a keen Brexiteer, you will donate to Boris’s campaign. If you’re a business which backs a secon d referendum, you will donate to Right to Vote."
Brexit tears through UK’s political landscape - After yet another night of unexpected electoral drama, each and every side of the never-ending Brexit debate — leave now, leave somehow or leave never — was quick out of the blocks to claim validation for their position Friday. What is needed, everyone declared, is the bravery to do exactly as they said before. Voters could be forgiven for spontaneously self-combusting. The Conservatives, unable to assemble a majority in parliament for any form of Brexit, suffered significant losses in the elections to town councils across the country. With almost all of the ballots declared, the party has lost control of almost 40 councils and over 1,000 seats: A bad night. Labour, meanwhile, having hedged its bets on Brexit in an attempt to appeal to Leave and Remain voters, also suffered, though not as badly, losing four councils and more than 100 seats. This was, undeniably, also a bad night. The results were, Foreign Secretary Jeremy Hunt declared, “a slap in the face for both the main parties.” Few Labour MPs felt confident enough to demure much from this analysis. Easy conclusions as to why were, however, illusive.
Corbyn under pressure to change Brexit stance after disappointing Labour result - It’s been a disappointing night for both main parties in the local elections. As predicted, the Conservatives have suffered serious losses and could be on course to lose around 800 council seats by the time all votes have been counted. Perhaps more surprising is Labour’s bad turn. The party has suffered a net loss of seats taking a hit in Leave areas like Sunderland, Ashfield and Bolsover. This is not the performance one would expect from a party on course for a majority in a general election. Labour councillors and politicians have been quick to start the blame game. After Labour lost ten seats in Sunderland, the party’s council leader Graeme Miller blamed Labour MPs supporting a second referendum: ‘Sunderland voted as a city to leave in June 2016, and having had a Labour message across the city from MPs saying we need to be having a second referendum, people in Sunderland have said ‘we are just not accepting that’. Barnsley Labour leader Stephen Houghton has blamed Brexit for a bad showing – ‘the message we are getting loud and clear is all about Brexit’. MPs representing Leave constituencies have been quick to echo that message with Stoke MP Ruth Smeeth saying ‘there are consequences for us not moving forward with Brexit, in that hundreds of councillors will lose their seats’. Others are blaming Labour ambiguity. Jess Phillips has suggested that the problem is a lack of clarity – and urged her party to be brave. Given that the Birmingham MP has spoken in favour of a second referendum, it’s fair to say she has a different idea of what clear position the party should take than Miller. Notably, shadow chancellor John McDonnell has taken to social media to suggest it’s time to take decisive action on the issue: ‘Brexit – sort it’. So, where does this leave the party’s Brexit position? The figures in the Leader’s Office who have consistently fought off efforts to make the party explicitly endorse a second referendum will be able to point to the losses in the north as vindication of their argument. Had the party gone all out for a second referendum, the result in these areas would have likely been even worse. On the flip side, the big winner from the local elections is the Lib Dems – an explicitly pro-EU party. They have made the most gains and succeeded in making inroads in Tory areas. This means the People’s Vote campaigners can point to this and argue that a clear Remain position would aid the party.
UK government’s Brexit talks with Labour to resume after weekend – May’s spokeswoman (Reuters) - The British government’s talks with the Labour Party to try to break the impasse over Brexit will resume after the weekend, Prime Minister Theresa May’s spokeswoman said on Friday. May opened talks with Labour a month ago after her deal to leave the European Union was rejected three times in parliament, but despite both sides saying they are constructive, there is little expectation of breakthrough next week. “It’s important that we get it right,” the spokeswoman said of the talks, adding that May understood the frustration of some in Britain over the delay to Brexit after voters punished her Conservative Party in local elections on Thursday.
Liverpool man dies after being declared fit for work and denied benefits - Stephen Smith, 64, died in an emaciated state on April 15. The last years of his life were marred by serious ill health, made worse by the punitive actions of the Department for Work and Pensions (DWP) who denied him Employment Support Allowance (ESA) and declared him “fit for work.”Smith’s ailments included chronic obstructive pulmonary disease, osteoarthritis and an enlarged prostate. He also had a colostomy bag. He had recently been in hospital with a bout of pneumonia, which may have led to his death. His chronic ill-health meant that his weight had dropped to six stones (84 lbs./38 kgs.) and he feared for his life.Smith had worked all his life, until his health deteriorated in 2006/2007. He was employed as a plumber and then ran a shop repairing fridges and washing machines. Well-known and respected locally, he never married but had family in the area. He was admitted to hospital last Christmas because of deteriorating health. Despite his long-term chronic health problems, Smith failed a DWP Work Capability Assessment (WCA) in March 2017. Failure meant he lost his right to ESA and instead had to sign on each week as available for work to receive Job Seeker’s Allowance of just £67 a week. JSA requires claimants to prove they are actively seeking work. Photos of Smith published in the Liverpool Echo at the time he was refused ESA are heart-breaking and caused widespread outrage. The DWP dismissed letters from two doctors who had written in Smith’s support. They stated that because of his chronic illness, he was unable to walk 20 metres without getting exhausted and being in pain.
NHS data is a public asset. Why does Matt Hancock want to give it away? This week, Health Secretary Matt Hancock launched a report with the Taxpayers’ Alliance (TPA), calling for increased automation of NHS services through partnerships with private sector technology companies. The pairing is highly questionable in itself – the (misnamed) Taxpayers’ Alliance is a right-wing lobby group backed by big business, which seeks to drastically reduce the role of the state and has previously called forreplacing the NHS with an “insurance-based model” of healthcare. But that’s not all that should concern us. The report is just the latest in a string of moves by the Health Secretary to open up hugely valuable, publicly-held NHS datasets to the private sector. Vast amounts of private NHS data have been transferred to private firms, under the auspices of recent public-private partnerships to develop artificial intelligence and other data-driven technologies for the NHS. Some of them are highlighted in the TPA report itself. One such example is the partnership between the Royal Free NHS Trust in London and DeepMind, a wholly-owned subsidiary of Google’s parent company Alphabet. Announced in 2016, the agreement provided DeepMind with access to 1.6 million patients’ medical records, which it would use to develop and launch its new healthcare app, Streams. Although the way DeepMind handles NHS data has changed since the Information Commissioner’s Office deemed the agreement to have breached the Data Protection Act, the company has continued to develop and scale the app at further NHS Trusts across the country.
Julian Assange sentenced to 50 weeks in jail for bail violation in vindictive political ruling - WikiLeaks founder Julian Assange was sentenced to 50 weeks imprisonment in a show trial Wednesday at Southwark Crown Court.Assange has been incarcerated in London’s Belmarsh prison, in conditions amounting to solitary confinement and without access to visitors, following his illegal seizure April 3 from the Ecuadorian embassy.The sentence on bail charges is just two weeks short of the maximum one-year sentence he could have received, despite already being held in arbitrary detention by the British authorities since he was first detained in London in December 2010. Assange was found guilty last month of being in breach of the Bail Act. His treatment and sentencing by Judge Deborah Taylor yesterday was even more vindictive than that meted out by Judge Michael Snow two weeks ago, who had described Assange during a politically biased hearing as a “narcissist”. With Assange fearing for his life, after a series of senior US politicians said they favoured him being put to death, Snow said callously that Assange should “get over to the US” and “get on with your life.” Taylor was more venomous still. Assange had put himself “deliberately out of reach” in the embassy and, since 2012, had been “exploiting your privileged position to flout the law and advertise internationally your disdain for the law of this country.” Numerous legal experts have refuted such assertions, pointing out that the bail charge was effectively resolved years ago as Assange had forfeited bail money in 2012. Moreover, he spent far more time involuntarily detained in the Ecuadorian embassy than the maximum sentence for bail violations.
Assange refuses extradition to US; long legal fight expected — A defiant Julian Assange told a London court Thursday he will fight extradition to the United States to face charges of conspiring to hack into a Pentagon computer, arguing that his work as WikiLeaks founder has benefited the public.Speaking by video link from Belmarsh Prison in southeast London, Assange said: “I do not wish to surrender myself for extradition for doing journalism that has won many awards and protected many people.”His formal refusal to be extradited marks the start of what is expected to be a bruising legal battle over whether he will be brought to trial in the United States.Assange, wearing jeans and a sports jacket, appeared calm during the brief hearing at London’s Westminster Magistrates’ Court. Some of his supporters who couldn’t get seats in the small courtroom chanted support for Assange from the hallways, shouting “Shame on you” at the judge.Judge Michael Snow said it would likely be “many months” before a full hearing was held on the substance of the U.S. extradition case. The judge set a procedural hearing for May 30, with a substantive hearing to follow on June 12 once a full U.S. extradition request has been received and studied by Assange’s lawyers.Legal experts predict it will likely take 18 months or longer to resolve the case, with each side able to make several appeals of unfavorable rulings. In a separate case, the 47-year-old Australian was sentenced Wednesday to 50 weeks in prison in the U.K. for jumping bail in 2012 and holing up in the Ecuadorian Embassy in London. At the time, he was facing extradition to Sweden for questioning over rape and sexual assault allegations made by two women.
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