May 05, 2008
Categories: Hillary Clinton

Clinton: OPEC ‘can no longer be a cartel’

Clinton’s attacks on oil prices as artificially inflated, Enron-style, keep escalating, and today she appeared to threaten to break up the Organization of Petroleum Exporting Countries.

“We’re going to go right at OPEC,” she said. “They can no longer be a cartel, a monopoly that get together once every couple of months in some conference room in some plush place in the world, they decide how much oil they’re going to produce and what price they’re going to put it at,” she told a crowd at a firehouse in Merrillville, IN.

“That’s not a market. That’s a monopoly,” she said, saying she’d use anti-trust law and the World Trade Organization to take on OPEC.

The examples of Braddock, PA and Greensburg, Kansas, the town last year leveled by a tornado, portray much hope for the future.

I’m adding the Mayor of Braddock’s website to the blogroll on the right. He is an inspiration for sure. The video of the story is available at the PBS link below. Be sure to watch it!

Via PBS Newhour

Here’s a question that may never have occurred to you: Can a region of the Rust Belt become an eco-showcase, a model that could be exported around the country, even globally?

Can going green, that is, become a new American way to prosper, even confer a competitive edge in the global economy?

Consider an extreme case of decline. Just eight miles east of Pittsburgh, the once thriving steel citadel of Braddock, home to the very first Carnegie steel mill, the very first Carnegie library.

At its height in the 1950s and ’60s, Braddock’s downtown was bustling with businesses, a town with visitors from everywhere, and more than 20,000 local inhabitants. How many today?

JOHN FETTERMAN, Mayor, Braddock, Pennsylvania: Around 2,800. It’s probably the single most dramatic decline of a town that I’m aware of in this country.

PAUL SOLMAN: Mayor John Fetterman’s vision is to turn things around with a new competitive strategy for the global age: going green for health and profit.

Fetterman, from York, Pennsylvania, came here in 2001 with a Harvard degree in public policy and an instinct for sympathy. He found a population so desperate they were killing each other for pizza money. The dates of each violent death in town since his election in 2005 are etched in memoriam.

On the other hand…

JOHN FETTERMAN: This is the zip code here.

PAUL SOLMAN: 15104?

JOHN FETTERMAN: 15104, which, again, really just, again, for me emphasizes the level of commitment that I have for the community.

Oil’s slippery slope

With the oil price heading upwards and President George Bush heading for Saudi Arabia, as part of a Middle Eastern tour, it is time to accept the truth. The pursuit of oil is fundamental to US foreign policy.The importance of oil to American foreign policy is both obvious and curiously difficult to acknowledge in public. In the run-up to the Iraq war it was left to the left to make the argument that this was a “war for oil”. Establishment people – those in the know – rolled their eyes at this “conspiracy theory”.

Yet in recent months, both Alan Greenspan, former chairman of the Federal Reserve, and Senator John McCain have come close to saying that Iraq was indeed about oil. In his memoirs Mr Greenspan said he regretted that it was “politically inconvenient” to acknowledge that “the Iraq war is largely about oil”.

Tuesday, October 16, 2007

Oil on the Rise
Oil reached a new intra-day record at $88.05 (US Light Sweet Crude).

Via NYTimes:

With the price of gas approaching $4 a gallon, more commuters are abandoning their cars and taking the train or bus instead.

Mass transit ridership was up 8 percent in Denver in the first three months of the year compared with last year, despite a fare increase in January and a slowing economy.

Mass transit systems around the country are seeing standing-room-only crowds on bus lines where seats were once easy to come by. Parking lots at many bus and light rail stations are suddenly overflowing, with commuters in some towns risking a ticket or tow by parking on nearby grassy areas and in vacant lots.
[...]

Transit systems in metropolitan areas like Minneapolis, Seattle, Dallas-Fort Worth and San Francisco reported similar jumps. In cities like Houston, Nashville, Salt Lake City, and Charlotte, N.C., commuters in growing numbers are taking advantage of new bus and train lines built or expanded in the last few years. The American Public Transportation Association reports that localities with fewer than 100,000 people have also experienced large increases in bus ridership.

Via WashingtonTimes.com

The issue is not simply a concern that we will have to pay outrageous prices for a gallon of gas. If that were the worst of it, the situation would be difficult but manageable. The reality, however, goes deeper and is much more troubling. There are multiple problems affecting the world that are having a decidedly negative net effect: a global rise in demand for crude oil, the plateau in the production of crude oil (which may indicate the peak has already been reached) and continued global population growth. Together, these three factors are serving to shove the world into a crisis that has ominous possibilities.

When there isn’t enough oil to satisfy global demand, the price obviously rises. Perhaps less obvious, however, is the effect this price increase has on the world’s ability to produce food. Every stage of the food production cycle is affected by petroleum and a rise in the price of a barrel of oil has compounding effects: It costs more to run the farm machinery, more to buy the fertilizer, more to take it to market and more for processing. In the United States, this results in raised eyebrows at the grocery store. In parts of the world where upwards of 75 percent of a family’s income goes to buying food, it results in social unrest and riots.

via theOilDrum.com & Omaha.com

Buffett also said that the world’s production of oil, about 87 million barrels a day, is close to capacity. While the world won’t run out of oil this century, as one questioner suggested, Buffett said gradually depleted oil fields could reduce the amount produced.

Munger said he thinks oil production 25 years from now will be less than today.

“That’s not an insignificant prediction, believe me,” Buffett said, since demand for oil is growing steadily as the population grows and standards of living rise. “If oil production is down 25 years from now, it’s going to be a different world.”

Via TheOilDrum.com:

The Resurgence of Risk: A Primer on the Developing Credit Crunch
We have been living in inflationary times, for as long as most of us can remember. The money supply keeps expanding and prices increase over time as a result. Central bankers have many tools at their disposal which they can use to tweak the economy – they can raise or lower interest rates, can control reserve requirements for fractional reserve banking and can inject liquidity into the banking system, among other things – and we have become used to thinking that they can prevent the kind of ‘economic accidents’ that previous episodes of excess have led to in the past. Especially in recent years – since the apparently successful containment of the dot com aftermath - we have acted as if risk were a thing of the past. Sliced, diced and spread around Wall Street and the rest of the global financial system, risk has seemed tamed, contained and controlled, until last week that is.

For years, industry insiders and so-called experts have proclaimed the virtues of slicing, dicing, and repackaging risk. They waxed on about how borrowers and savers, and society as a whole, could only benefit from such machinations. They suggested any sort of exposure could be disbursed and dissipated to the point where it essentially disappeared. Some even claimed that the crises of the past would no longer exist.

Yet amid the hype and assurances, few supporters spoke of the dark side of wanton and widespread risk-shifting. They didn’t seem — or want — to acknowledge that by combining complicated risks in unfamiliar and unnatural ways, the end result could be an uncontrollable monstrosity—one that eventually turned on its masters.
Nor did they heed the notion that by scattering risk into every nook and cranny of the global financial system, the vast web of overlapping linkages virtually guaranteed that serious problems in one sector, market, or country would trigger far-reaching shockwaves.

All of a sudden, markets are reeling around the world, deals are unraveling, the mainstream press is talking about a credit crunch and the world’s central bankers are injecting unprecedented amounts of liquidity to calm the markets. Risk has made a comeback, and in that environment the evident concern of the central bankers does not seem very reassuring.

Via RawStory.com & the AP

Some 300,000 U.S. troops are suffering from major depression or post traumatic stress from serving in the wars in Iraq and Afghanistan, and 320,000 received brain injuries, a new study estimates.

Only about half have sought treatment, said the study released Thursday by the RAND Corporation.

“There is a major health crisis facing those men and women who have served our nation in Iraq and Afghanistan,” said Terri Tanielian, the project’s co-leader and a researcher at the nonprofit RAND.

“Unless they receive appropriate and effective care for these mental health conditions, there will be long-term consequences for them and for the nation,” she said in an interview with The Associated Press.

The 500-page study is the first large-scale, private assessment of its kind — including a survey of 1,965 service members across the country, from all branches of the armed forces and including those still in the military as well veterans who have left the services.

Its results appear consistent with a number of mental health reports from within the government, though the Defense Department has not released the number of people it has diagnosed or who are being treated for mental problems. The Department of Veterans Affairs said this month that its records show about 120,000 who served in the two wars and are no longer in the military have been diagnosed with mental health problems. Of the 120,000, approximately 60,000 are suffering from PTSD, the VA said.

Via NYTimesBlogs & Paul Krugman

April 15, 2008, 9:02 pm
Oil numbers

There are two basic facts that would seem to explain a lot about what’s happening to oil prices.

First, Gross World Product growth has accelerated — from 2.9 percent in the 90s to almost 5 percent in recent years, according to the IMF. All of this is because of growth in emerging economies, largely China.

Second, world oil production has stalled — after growing around 1.6% a year in the 90s, it’s been basically flat for the last three years.

So we’ve got rapidly growing demand due to industrialization in Asia colliding with stagnant supply, basically because oil is getting hard to find. (The demand shock is probably even bigger than the GDP number suggests, because China’s economy is highly energy-inefficient).

And the demand for oil is price-inelastic — that is, it takes big price increases to persuade people to use significantly less.

There’s probably more to the story, but that seems to be the basic thrust. And it seems to be a recipe for rising prices for a long time to come.

This is what peak oil is supposed to look like — not Oh My God We’ve Just Run Out Of Oil, but steady pressure on the economy and the way we live from rising energy prices and their consequences. And it doesn’t matter much whether we’re literally at the peak, or whether production can rise by a few million more barrels a day; unless there are big sources of oil out there, we’ll be feeling peakish for the foreseeable future.

For now, another article on food shortages….

Via Naked Capitalism

While the New York Times has a good analysis today, “Fuel Choices, Food Crises and Finger-Pointing,” on the increasingly contentious biofuel programs, I found “Our global warming rage lets global hunger grow,” by Ambrose Evans-Pritchard at the Telegraph the more informative treatment. In part, it’s because he marshals some statistics that I haven’t seen elsewhere, such as how dependent some countries are on grain imports. In this case, I also found his tendency to sensationalism useful. People are starving, More will starve if the first world and rapidly developing third world countries don’t curtail their consumption of animal and fish protein and get off the biofuel kick.

One can take the Scrooge/Malhtusian view that there are always poor people who lead lives of desperation and want and do the equivalent of turning to another channel. But this crisis is not going away; it’s becoming ever more acute. And the reason that the rich and powerful nations have taken interest isn’t simply competition for scarce food resources (although that is an issue too). The bigger danger is refusal to export by the haves, and wars and mass emigrations by the have-nots. The Evans-Pritchard piece give a more visceral sense of what’s at stake.

From the Telegraph:

We drive, they starve. The mass diversion of the North American grain harvest into ethanol plants for fuel is reaching its political and moral limits.

“The reality is that people are dying already,” said Jacques Diouf, of the UN’s Food and Agriculture Organization (FAO). “Naturally people won’t be sitting dying of starvation, they will react,” he said.

The UN says it takes 232kg of corn to fill a 50-litre car tank with ethanol. That is enough to feed a child for a year. Last week, the UN predicted “massacres” unless the biofuel policy is halted.

We are all part of this drama whether we fill up with petrol or ethanol. The substitution effect across global markets makes the two morally identical.

Mr Diouf says world grain stocks have fallen to a quarter-century low of 5m tonnes, rations for eight to 12 weeks. America - the world’s food superpower - will divert 18pc of its grain output for ethanol this year, chiefly to break dependency on oil imports. It has a 45pc biofuel target for corn by 2015.

Argentina, Canada, and Eastern Europe are joining the race.

Monsanto’s Harvest of Fear

Gary Rinehart clearly remembers the summer day in 2002 when the stranger walked in and issued his threat. Rinehart was behind the counter of the Square Deal, his “old-time country store,” as he calls it, on the fading town square of Eagleville, Missouri, a tiny farm community 100 miles north of Kansas City.

The Square Deal is a fixture in Eagleville, a place where farmers and townspeople can go for lightbulbs, greeting cards, hunting gear, ice cream, aspirin, and dozens of other small items without having to drive to a big-box store in Bethany, the county seat, 15 miles down Interstate 35.

Everyone knows Rinehart, who was born and raised in the area and runs one of Eagleville’s few surviving businesses. The stranger came up to the counter and asked for him by name.

“Well, that’s me,” said Rinehart.

As Rinehart would recall, the man began verbally attacking him, saying he had proof that Rinehart had planted Monsanto’s genetically modified (G.M.) soybeans in violation of the company’s patent. Better come clean and settle with Monsanto, Rinehart says the man told him—or face the consequences.

Rinehart was incredulous, listening to the words as puzzled customers and employees looked on. Like many others in rural America, Rinehart knew of Monsanto’s fierce reputation for enforcing its patents and suing anyone who allegedly violated them. But Rinehart wasn’t a farmer. He wasn’t a seed dealer. He hadn’t planted any seeds or sold any seeds. He owned a small—a really small—country store in a town of 350 people. He was angry that somebody could just barge into the store and embarrass him in front of everyone. “It made me and my business look bad,” he says. Rinehart says he told the intruder, “You got the wrong guy.”

When the stranger persisted, Rinehart showed him the door. On the way out the man kept making threats. Rinehart says he can’t remember the exact words, but they were to the effect of: “Monsanto is big. You can’t win. We will get you. You will pay.”

Via Bloomberg.com

Rationing Power

Chile may be forced to limit power use for the first time since 1999 because a drought has reduced water levels at hydroelectric reservoirs, said Sergio Zapata, an energy analyst at Santiago stock broker BanChile Corredores de Bolsa.

The drought pared electricity output at utilities already strained after neighboring Argentina decreased gas shipments starting in 2004. In northern Chile, generators designed to run on natural gas are using diesel instead, increasing the risk of machinery failures and blackouts, Zapata said.

“There can be a problem at any moment because of equipment breakdowns,” Zapata said.

Copper futures on the Comex division of the New York Mercantile Exchange may top the record of $4.04 a pound if supplies are disrupted, said Rodrigo Aravena, an economist at BanChile. The brokerage forecasts an average for 2008 of $3.50, compared with $3.23 last year.

`Buying Orgy’

Copper gained 32 percent this year to $4, making it the third-best performer behind natural gas and corn among 19 commodities in the Reuters/Jefferies CRB Index. Credit Suisse Group said April 4 copper may reach $12,000 a ton ($5.44 a pound) this year in London.

Not everyone expects higher prices.

This year’s first-quarter gain was fueled more by hedge- fund buyers than physical demand or supply shortages, Austin Brown, an analyst at Touradji Capital Management LP, said April 2. Paul Touradji, founder of the fund, said last month a raw- materials “buying orgy” had increased the risk of a collapse.

Via NYTimes

With little fanfare, a small number of prominent academic scientists have made a decision that was until recently all but unheard of. They decided to stop accepting payments from food, drug and medical device companies.

No longer will they be paid for speaking at meetings or for sitting on advisory boards. They may still work with companies. It is important, they say, for knowledgeable scientists to help companies draw up and interpret studies. But the work will be pro bono.

The scientists say their decisions were private and made with mixed emotions. In at least one case, the choice resulted in significant financial sacrifice. While the investigators say they do not want to appear superior to their colleagues, they also express relief. At last, they say, when they offer a heartfelt and scientifically reasoned opinion, no one will silently put an asterisk next to their name.

They are part of a group responding to accusations of ethical conflicts inherent in these arrangements, and their decisions repudiate decades of industry influence, says Dr. Jerome P. Kassirer, a professor at the Tufts School of Medicine, who has written a book on conflicts of interest.

Five years ago, “nobody paid any attention to taking money from industry,” he said, adding: “They just took it. In some instances, I think people thought they were suckers if they didn’t.”

Even last year, the Food and Drug Administration decided that it could not altogether ban researchers from its advisory boards who took industry consulting fees.

Now, Dr. Kassirer said, he keeps finding experts who are rejecting the money.

“I don’t think there’s any question that the atmosphere has changed,” Dr. Kassirer said.

Basic access to food is slipping out of reach for many people in developing countries.

The cost of the rice has risen by more than three-quarters in two months and the price of wheat has more than doubled in the same time.

The desperation in dozens of countries has turned deadly of late. In the past week alone there have been violent, food-related riots in Haiti, Indonesia, the Philippines and Cameroon.

World Vision Australia head Tim Costello says the situation is desperate and chronic.

“It is an apocalyptic warning,” he said. “Until recently we had plenty of food. The question was distribution.

“The truth is because of rising oil prices, global warming and the loss of arable land, all countries that can produce food now desperately need to produce more.”

Via IBDEditorials.com

If this is the kind of whiny shit we can expect with continued energy price increases, I might end up a recluse.

Via IOL.co.za

Renowned musician David Kramer is determined to give Eskom “the finger” presumably one of his unscathed digits after he injured two of his strumming fingers in a load-shedding-related accident at his home.

Kramer said he hurt his fingers during a power cut at his Camps Bay home on Tuesday.

With no electricity available, he was forced [OH MY!!! -ed.]to open his automatic garage door manually but when he pulled it down, the tips of his right index finger and little finger were pinched in the joint of the door.

Kramer said that “like a typical man” he refused to go to the doctor until Wednesday morning, when his wife urged him to get treatment because his injuries were not getting any better.

…dude, grow some balls.

More on the South African Energy crisis at IOL: ESKOM Load Shedding.

Deep ecology is a recent branch of ecological philosophy (ecosophy) that considers humankind an integral part of its environment. Deep ecology places greater value on non-human species, ecosystems and processes in nature than established environmental and green movements. Deep ecology has led to a new system of environmental ethics. The core principle of deep ecology as originally developed is Arne Næss’s doctrine of biospheric egalitarianism — the claim that, like humanity, the living environment as a whole has the same right to live and flourish. Deep ecology describes itself as “deep” because it persists in asking deeper questions concerning “why” and “how” and thus is concerned with the fundamental philosophical questions about the impacts of human life as one part of the ecosphere, rather than with a narrow view of ecology as a branch of biological science, and aims to avoid merely utilitarian environmentalism, which it argues is concerned with resource management of the environment for human purposes.

Scientists Flesh Out Plans to Grow (and Sell) Test Tube Meat

[...]Rapidly evolving technology and increasing concern about the environmental impact of meat production are signs that vat-grown meat is moving from scientific curiosity to consumer option. In vitro meat production is a specialized form of tissue engineering, a biomedical practice in which scientists try to grow animal tissues like bone, skin, kidneys and hearts. Proponents say it will ultimately be a more efficient way to make animal meat, which would reduce the carbon footprint of meat products.

“To produce the meat we eat now, 75 to 95 percent of what we feed an animal is lost because of metabolism and inedible structures like skeleton or neurological tissue,” Jason Matheny, a researcher at Johns Hopkins and co-founder of New Harvest, a nonprofit that promotes research on in vitro meat, told Wired.com. “With cultured meat, there’s no body to support; you’re only building the meat that eventually gets eaten.”

Researchers can currently grow small amounts of meat in the lab, and have even been able to get heart cells to beat in Petri dishes. Growing muscle cells on an industrial scale is the next step, scientists say.

“That’s the goal and it seems pretty clear from this conference that it’s achievable,” said Matheny on Thursday by telephone from the symposium.[...]

Information, from the internet to rock videos, will not be contained, and fundamentalism cannot control its children. Our victims volunteer.

We use technology to expand our wealth, power, and opportunities. The rest get high on pop culture.

-Maj. Ralph Peters, Office of the Deputy chief of Staff for Intelligence

[from "Constant Conflict," Parameters, Summer 1997, pp. 4-14: US Army War College.]

Rice prices rose more than 10 per cent on Friday to a fresh all-time high as African countries joined south-east Asian importers in the race to head off social unrest by securing supplies from the handful of exporters still selling the grain in the international market.The rise in prices – 50 per cent in two weeks – threatens upheaval and has resulted in riots and soldiers overseeing supplies in some emerging countries, where the grain is a staple food for about 3bn people.

The increase also risks stoking further inflation in emerging countries, which have been suffering the impact of record oil prices and the rise in price of other agricultural commodities – including wheat, maize and vegetable oil – in the last year.

Kamal Nath, India’s trade minister, said the government would crack down on hoarding of essential commodities to keep a lid on food prices. “We will not hesitate to take the strongest possible measures, including using some of the legal provisions that we have against hoarding,’’ he said on Friday.

Thai medium-quality rice, a global benchmark, traded at about $850 a tonne on Friday, up from $760 a tonne last week, while the price of less representative top-quality aromatic rice broke the $1,000-a-tonne level for the first time, traders said. They added that the grain was being sold to African destinations.

In Chicago, US rice futures hit an all-time high of $20.45 per 100 pounds.

Although only a small amount of the grain is traded internationally, the rise in Thai prices signals the trend for the global market and also for domestic prices in countries where local production is enough to meet demand.

The price jump came as leading exporting countries, including Vietnam, India, China and Egypt, banned foreign sales. Hanoi extended its ban for two extra months until June.

Food aid officials said consumption could rise further because record food prices are forcing families to move from a diversified diet to just one staple.