Each week, I read the news voraciously, not only seeking enlightenment but also looking for the topic that will drive that week’s post to Birth of a Notion. I try hard to keep the topic relevant, topical and timely but sometimes I feel as if everyone is addressing the same topic in their blog, article or column so I set out to seek something different.
This news of this past week was dominated by the so-called budget compromise that ensued from the bloody budget battle that took place primarily between the United States Congress and the White House although there were sporadic but murderous fire fights that took place within both the Republican and Democratic Parties. With the Democrats it was between the liberal and moderate wings of the Party and with Republicans it was between the old line conservatives and the new upstart Tea Party freshman legislators.
I did not think I could add anything to that discussion so I looked around for something else and as important as the budget battle was, I wanted something that was possibly more important. And I think I found it. The year 2010 was a year for taking the United States census and among the many types of impact a count of our nation’s population creates, there is one that seems to get lost in the fog of data, policy and law—the redistricting of the United States Congress. The drawing of electoral districts is among the least transparent processes in democratic governance. All too often, redistricting authorities maintain their power by obstructing public participation. The resulting districts embody the goals of politicians to the detriment of the representational interests of communities and the public at large.
After the tidal wave of Republican victories in last year’s mid-term elections, it appeared that the GOP was poised to make redistricting history. In theory at least, Republicans seemed armed to the teeth to engage in the decennial activity of redistricting which this time around has ignited almost unprecedented public interest, to say nothing of the possible litigation waiting in the wings.
Now that the GOP has major control over the majority of state legislatures that historically are tasked with redistricting new legislative boundaries, they will have an opportunity to influence how more than 200 congressional districts around the country will be drawn.
But wait a minute! The Democrats despite their horrific defeat at the mid-term election polls are not exactly without some power of their own. Because the Republicans control so many seats in the U.S. House of Representatives, they now have to turn their attentions on to solidly-held Democratic Districts in order to expand their power and influence. That said, the 2010 census shows a demographic paradigm shift, particularly in the growth of the Hispanic population, and this time the demographic shifts tend to favor Democrats and could even cause the Republicans to retreat somewhat in their fervor to control everything.
In a sense, the Republican Party and their new Tea Party allies have themselves to blame. They have increased their majority in the House so much—particularly in swing districts—they now have the most to lose in states that are faced with eliminating congressional seats in order to be in compliance with the new districting requirements of the 2010 census. Louisiana is a prime example. Here, the state will lose a seat and the six Republicans who make up Louisiana’s delegation (there is also a lone Democrat) will begin to kill each other off as each congress person is engaged in the mad scramble to save their seat from extinction due to the new census.
In addition to Louisiana, Republicans also control the redistricting process in Ohio, Pennsylvania, Florida and Texas. Ohio loses two seats, Pennsylvania loses one, while Florida gains two seats and Texas will gain four new seats. In each of these states however, a mirror image of the fight in the U.S. Congress between the GOP Old Guard and the new Tea Party adherents will erupt at the state level as a fight for survival engulfs the old-line conservatives and their not-always-friendly allies, the take-no-prisoner Tea Party legislators.
One exception by the way to all this bloodletting is California where there, the ever innovative people of that state have put the task of redistricting squarely in the hands of an independent commission.
If however, you think that the new flock of tax and budget cutting Republicans will force incumbents to slink off into the darkness, think again. Legislators will do everything they can to draw districts that will help them hold onto their seat. Incumbents are developing new strategies to retain their seats such as instituting legal challenges to the entire redistricting process or as has been reported recently in the New York Times, hired consultants and lobbyists to help them keep their seats.
As always with matters like these, the courts will play an important role in determining final outcomes. Some Republicans have already promised to go to the U.S. District Court for the District of Columbia instead of the normal route, which has been appealing to the United States Justice Department. Republicans are avoiding this step because they feel there will be no one in Justice who has any empathy for their situation particularly since most of the appointments there come from the Obama administration. Keeping that dog from hunting however, is that historically, lower courts tend to defer to the Justice Department. Also, going to court—any court, involves expense, delays and of course there is always the chance you can lose.
Republicans however do have plenty of reasons to be happy. Due to the twin victories of a Supreme Court ruling which opened the floodgates of corporate political donations and the Federal Election Commission approving the collection of soft money for a National Democratic Redistricting Trust, the GOP now sits in the cat bird seat and with their control of the majority of state legislatures around the country, this could be an ugly fight.
Some political experts have already made the claim that political mud-slinging will be far worse this year than even last year, given what is at stake for the next ten years. Andrew Beveridge, a sociology professor at Queens College in New York City was quoted as saying, “What you are going to see is a game of musical chairs. I think it will be a big fight and it will be both state and national.”
Thursday, April 14, 2011
Thursday, April 7, 2011
Tea Anyone--Round Three
Love them or hate them—the tea party movement is a dominant force in American politics. This is especially true within the ranks of the Grand Old Party as Republican leadership in the House is now struggling with their new tea party freshman representatives.
Despite their hateful rhetoric, the tea partiers managed to completely dominate the 2010 GOP legislative and gubernatorial primaries and then went on to win almost every contested Republican primary race. Particularly hurt in the 2010 season of political upheaval were the long-time conservative senators and governors defeated in GOP conventions and primaries, because, as far as the tea party was concerned, the GOP of days gone by were just that—to liberal, too accommodating, too willing to compromise and most importantly, guilty of taxation gone wild.
But not every tea party candidate who roared to victory in their primary, ultimately won in their respective general elections. Two of the more notable general election defeats were losers Christine O’Donnell in Delaware and Sharron Angle in Nevada.
Remaining cognizant of the power of the tea party movement, how will their newly won influence impact the 2012 race to the White House? No Republican candidate is going to be the GOP nominee for the presidency unless he or she is embraced by the Tea Party. So, based on that realization, the process of elimination is not that difficult.
Mitt Romney while extremely conservative has adopted the strategy in the early goings on for the 2010 nomination to distance himself as far as he can from the Tea Party. What’s more, his authorship and support for the Massachusetts healthcare bill Romneycare (Come on, what’s fair is fair) is just too much for the tea partiers to stomach.
Mississippi Governor Haley Barbour spent too many years in DC as a beltway lobbyist and also as head of the Republican National Committee which means he fed at the trough for much too long. In the immortal words of Bob Dylan, “The only thing I did wrong was I stayed in Mississippi a day too long.” Haley, you stayed in DC years too long.
Jon Huntsman, former Obama ambassador to China and also known as the “liberal” Republican in Iowa has as much chance of being nominated without Tea Party support as I do.
Newt Gingrich, the man of a thousand positions—just as long as it is juxtaposed to President Obama’s has been married too many times, cheated on his many wives too many times, is constantly tripping over his own forked tongue and has no credibility with the Tea Party, the coffee party and the soft drink party.
Newest possible candidate for the nomination Donald Trump could not win an election to be dog catcher. He may have some in his corner because they support the stupid things he says about China, but tea partiers are simply not moved. Also, once the Tea Party discovers that in the past Mr. Trump has bankrolled several Democratic candidacies, he will be doomed.
And please forget the also-rans like Rudy Giuliani and Rick Santorum who attempted to use the Libyan crisis as a political hook they could hang their hat on.
That said, who can the Tea Party embrace?
Well, it seems that Minnesota Congresswoman Michelle Bachmann is getting all the attention right now. Sarah Palin was the darling of the tea partiers but Ms. Bachman has replaced her, mostly by acting like Sarah Palin multiplied by ten.
Tim Pawlenty, the consummate politician is attempting to be everything to everyone. The downside of that is when you choose to say yes to everyone, you end up being of no value to anyone. He is walking the very tricky tightrope of trying to appease both the Republican establishment while simultaneously wooing the Tea Party. Ain’t going to happen.
Ron Paul is a true libertarian which makes it difficult for the Tea Party to fully embrace him. Like most libertarian politicians however, he does have a small but devoted and almost fanatical base but it is not enough of one to get him the nomination.
Finally, Huckabee despite his initial strong start in the 2008 race fizzled rapidly after Iowa and New Hampshire and ultimately his campaign simply crashed and burned. Today, he might be considered the front runner, but if that is all they got—the Republicans got problems.
Ultimately, the new upstart Tea Party will heavily influence the selection of the 2010 GOP nominee but that is absolutely no guarantee that he or she will win the general election for the presidency. Michelle Bachmann could end up being the next Christine O’Donnell if for no other reason that her witch credentials are more easily proven. In any event, Congresswoman Bachmann will never attract enough independent voters to win the White House.
I don’t know about you, but I can hardly wait for this thing to start…
Despite their hateful rhetoric, the tea partiers managed to completely dominate the 2010 GOP legislative and gubernatorial primaries and then went on to win almost every contested Republican primary race. Particularly hurt in the 2010 season of political upheaval were the long-time conservative senators and governors defeated in GOP conventions and primaries, because, as far as the tea party was concerned, the GOP of days gone by were just that—to liberal, too accommodating, too willing to compromise and most importantly, guilty of taxation gone wild.
But not every tea party candidate who roared to victory in their primary, ultimately won in their respective general elections. Two of the more notable general election defeats were losers Christine O’Donnell in Delaware and Sharron Angle in Nevada.
Remaining cognizant of the power of the tea party movement, how will their newly won influence impact the 2012 race to the White House? No Republican candidate is going to be the GOP nominee for the presidency unless he or she is embraced by the Tea Party. So, based on that realization, the process of elimination is not that difficult.
Mitt Romney while extremely conservative has adopted the strategy in the early goings on for the 2010 nomination to distance himself as far as he can from the Tea Party. What’s more, his authorship and support for the Massachusetts healthcare bill Romneycare (Come on, what’s fair is fair) is just too much for the tea partiers to stomach.
Mississippi Governor Haley Barbour spent too many years in DC as a beltway lobbyist and also as head of the Republican National Committee which means he fed at the trough for much too long. In the immortal words of Bob Dylan, “The only thing I did wrong was I stayed in Mississippi a day too long.” Haley, you stayed in DC years too long.
Jon Huntsman, former Obama ambassador to China and also known as the “liberal” Republican in Iowa has as much chance of being nominated without Tea Party support as I do.
Newt Gingrich, the man of a thousand positions—just as long as it is juxtaposed to President Obama’s has been married too many times, cheated on his many wives too many times, is constantly tripping over his own forked tongue and has no credibility with the Tea Party, the coffee party and the soft drink party.
Newest possible candidate for the nomination Donald Trump could not win an election to be dog catcher. He may have some in his corner because they support the stupid things he says about China, but tea partiers are simply not moved. Also, once the Tea Party discovers that in the past Mr. Trump has bankrolled several Democratic candidacies, he will be doomed.
And please forget the also-rans like Rudy Giuliani and Rick Santorum who attempted to use the Libyan crisis as a political hook they could hang their hat on.
That said, who can the Tea Party embrace?
Well, it seems that Minnesota Congresswoman Michelle Bachmann is getting all the attention right now. Sarah Palin was the darling of the tea partiers but Ms. Bachman has replaced her, mostly by acting like Sarah Palin multiplied by ten.
Tim Pawlenty, the consummate politician is attempting to be everything to everyone. The downside of that is when you choose to say yes to everyone, you end up being of no value to anyone. He is walking the very tricky tightrope of trying to appease both the Republican establishment while simultaneously wooing the Tea Party. Ain’t going to happen.
Ron Paul is a true libertarian which makes it difficult for the Tea Party to fully embrace him. Like most libertarian politicians however, he does have a small but devoted and almost fanatical base but it is not enough of one to get him the nomination.
Finally, Huckabee despite his initial strong start in the 2008 race fizzled rapidly after Iowa and New Hampshire and ultimately his campaign simply crashed and burned. Today, he might be considered the front runner, but if that is all they got—the Republicans got problems.
Ultimately, the new upstart Tea Party will heavily influence the selection of the 2010 GOP nominee but that is absolutely no guarantee that he or she will win the general election for the presidency. Michelle Bachmann could end up being the next Christine O’Donnell if for no other reason that her witch credentials are more easily proven. In any event, Congresswoman Bachmann will never attract enough independent voters to win the White House.
I don’t know about you, but I can hardly wait for this thing to start…
Thursday, March 31, 2011
The GOP's Knee-Jerk Strategy for 2012
Since the crisis in Libya began to unfold, the potential Republican 2012 presidential candidates have expressed a broad array of views on whether and how the United States should intervene. Although the prospective GOP contenders differ from each other—and in one glaring example, Newt Gingrich seemed to disagree with himself—there appears to be one area in which they have found unity: all have argued that President Obama has handled the Libyan crisis badly.
As early developments in Libya transpired in an unpredictable manner, the prospective Republican contenders were initially reluctant to make any bold statements. But, when the Obama administrations was seemingly hesitant in their reaction to the crisis, former Minnesota Governor Tim Pawlenty, former House Speaker Newt Gingrich and former Pennsylvania United States Senator Rick Santorum jumped at the opportunity to criticize. All three called on the establishment of a no-fly zone before President Obama could put together international support to implement one.
Rick Santorum made it clear that he at least had it all figured out, “In a very short time he’ll be gone” he predicted of Moammar Gaddafi, should air strikes be carried out and a no fly zone be initiated.
In contrast to Santorum’s hawkish proposal, Mississippi Governor Haley Barbour and Minnesota Congresswoman Michele Bachman spoke out against military intervention. Eleven days before President Obama gave his Monday night address to the country, Bachman cited a lack of intelligence on the motives and backgrounds of Libyan rebels as a reason to strike at Gaddafi.
“For us to go in with American soldiers on the ground, right now would be a mistake,” Bachman said, “We should not go that route. The same with arming—I think that would be a mistake right now.” This of course has led her supporters to spread the word that Libyan rebels fighting against Gaddafi are actually Al Qaeda and because of that, we should stay out of Libya.
Once however the President authorized U.S. led air strikes on March 19th, the prospective Republican candidates en masse echoed a unified message that Obama was managing the situation poorly. Days after the President ordered air strikes former Massachusetts Governor Mitt Romney broke his silence on Libya stating that while he supported military action, he believed the President had not shown an ability to “construct a coherent foreign policy.”
“He calls for the removal of Gaddafi but then conditions our action on the directions we get from the Arab League and the United Nations” Romney said. Other GOP candidates and prospective candidates agreed with Romney suggesting that President Obama was too concerned with multilateralism.
Almost before the cameras switched to news commentators immediately following the President’s Monday night speech, former Alaskan Governor Sarah Palin escalated her own consistent criticism of the President on anything he says or anything she thinks he said by stating on FOX News that the President’s address was “profoundly disappointing.” She went on to say that “We’re not hearing from our President what the end game is here. And with Gaddafi still in power, if we’re not going to oust him via killing or capturing, then there is not an acceptable end state.”
Huh?
The strategy of the Republicans thus far is to pour constant criticism on the White House and on the President’s every move. This incessant criticism and disparagement of our commander-in-chief could however, prove to be risky business at a time when once again U.S. soldiers, sailors and the air force are deployed into a difficult and complicated military operation.
On March 29th, the day after President Obama’s address to the nation on his Libyan policy, that bastion of American conservatism, the Wall Street Journal, while stating its own criticism of Obama’s authorization of a no-fly zone also condemned what it called an “instinctive temptation” among Republicans to oppose the Libyan mission without sufficient reason.
The editorial targeted Haley Barbour in particular for offering what it called a “glib troupe to the isolationist left” in response to the Mississippi Governor’s warning against nation-building in Libya.
The Wall Street Journal’s disdain for the brand of GOP politics that seems to simply attack for the sake of attacking is exemplified by its ridiculing of Newt Gingrich who seemed to take a 180-degree shift in his position—first by calling for intervention prior to the deployment of the no fly zone to then arguing against intervention once the no fly zone had been implemented.
This past week’s cacophony of Republican response to the President simply means one thing: that the Republican Party is in disarray and that the more conservative wing of the GOP has determined that the way to win in 2012 is to dispute everything the President says. If you still require proof of this, simply remember their outrage when the President had the unmitigated gall to give a speech urging America’s young people to stay in school.
As early developments in Libya transpired in an unpredictable manner, the prospective Republican contenders were initially reluctant to make any bold statements. But, when the Obama administrations was seemingly hesitant in their reaction to the crisis, former Minnesota Governor Tim Pawlenty, former House Speaker Newt Gingrich and former Pennsylvania United States Senator Rick Santorum jumped at the opportunity to criticize. All three called on the establishment of a no-fly zone before President Obama could put together international support to implement one.
Rick Santorum made it clear that he at least had it all figured out, “In a very short time he’ll be gone” he predicted of Moammar Gaddafi, should air strikes be carried out and a no fly zone be initiated.
In contrast to Santorum’s hawkish proposal, Mississippi Governor Haley Barbour and Minnesota Congresswoman Michele Bachman spoke out against military intervention. Eleven days before President Obama gave his Monday night address to the country, Bachman cited a lack of intelligence on the motives and backgrounds of Libyan rebels as a reason to strike at Gaddafi.
“For us to go in with American soldiers on the ground, right now would be a mistake,” Bachman said, “We should not go that route. The same with arming—I think that would be a mistake right now.” This of course has led her supporters to spread the word that Libyan rebels fighting against Gaddafi are actually Al Qaeda and because of that, we should stay out of Libya.
Once however the President authorized U.S. led air strikes on March 19th, the prospective Republican candidates en masse echoed a unified message that Obama was managing the situation poorly. Days after the President ordered air strikes former Massachusetts Governor Mitt Romney broke his silence on Libya stating that while he supported military action, he believed the President had not shown an ability to “construct a coherent foreign policy.”
“He calls for the removal of Gaddafi but then conditions our action on the directions we get from the Arab League and the United Nations” Romney said. Other GOP candidates and prospective candidates agreed with Romney suggesting that President Obama was too concerned with multilateralism.
Almost before the cameras switched to news commentators immediately following the President’s Monday night speech, former Alaskan Governor Sarah Palin escalated her own consistent criticism of the President on anything he says or anything she thinks he said by stating on FOX News that the President’s address was “profoundly disappointing.” She went on to say that “We’re not hearing from our President what the end game is here. And with Gaddafi still in power, if we’re not going to oust him via killing or capturing, then there is not an acceptable end state.”
Huh?
The strategy of the Republicans thus far is to pour constant criticism on the White House and on the President’s every move. This incessant criticism and disparagement of our commander-in-chief could however, prove to be risky business at a time when once again U.S. soldiers, sailors and the air force are deployed into a difficult and complicated military operation.
On March 29th, the day after President Obama’s address to the nation on his Libyan policy, that bastion of American conservatism, the Wall Street Journal, while stating its own criticism of Obama’s authorization of a no-fly zone also condemned what it called an “instinctive temptation” among Republicans to oppose the Libyan mission without sufficient reason.
The editorial targeted Haley Barbour in particular for offering what it called a “glib troupe to the isolationist left” in response to the Mississippi Governor’s warning against nation-building in Libya.
The Wall Street Journal’s disdain for the brand of GOP politics that seems to simply attack for the sake of attacking is exemplified by its ridiculing of Newt Gingrich who seemed to take a 180-degree shift in his position—first by calling for intervention prior to the deployment of the no fly zone to then arguing against intervention once the no fly zone had been implemented.
This past week’s cacophony of Republican response to the President simply means one thing: that the Republican Party is in disarray and that the more conservative wing of the GOP has determined that the way to win in 2012 is to dispute everything the President says. If you still require proof of this, simply remember their outrage when the President had the unmitigated gall to give a speech urging America’s young people to stay in school.
Thursday, March 24, 2011
Three Little Words
Three short words, “No Fly Zone” sums up the current moral quandary for the world on where and when our responsibility to save lives should be more important that the supposed sanctity of national borders.
Not that long ago, when the global community agonized over the horrors taking place in Rwanda and Bosnia, observing as some kind of disinterested bystander while mass slaughter took place unchallenged by anyone, there was real support for the idea in the late 1990s that the international community did after all have a collective “responsibility to protect” people if their respective national governments failed to do so.
Then there was the long, bloody catastrophe that began with the US invasion of Iraq and the idea of a “kind and just war” became passé. The 2003 Iraqi invasion was justified by the George W Bush administration by claims of weapons of mass destruction (WMD), but when the WMD failed to materialize, both the United States and the United Kingdom attempted to play the humanitarian card by claiming they were in fact “liberating the Iraqi people.”
With the outbreak of the Libyan conflict, the pendulum has swung back towards action, but only part of the way. Britain’s conservative prime-minister, David Cameron, who until recently spoke out vehemently against any kind of meddling in Libya, is now maintaining that military intervention in the form of a no fly zone is necessary and is its most passionate supporter. He is joined, ironically enough, by the President of France, Nicolas Sarkozy whose government is deftly trying to shed its image in the Middle East as Gadaffi’s best friend.
In between all this, is an agonized Washington, D.C., which would of course ultimately finance, manage and carry most of the political and emotional baggage for a no fly zone. As always, Washington is divided between humanitarian idealists, hard-headed realists and the ever popular undecided contingent.
President Obama’s dilemma was further exacerbated by the muddiness of the whole thing. Gadaffi’s air force had not yet caused huge numbers of civilian casualties. The threat of that is ever present however and what his planes had managed to do, at least up until March 19th, was to keep the rag tag rebels under cover—unable to come out and fight. And, despite the Arab League’s endorsement of a no fly zone on March 12th, their views are still mixed and seem to go back and forth with the time of day.
Now however, all bets are off and the no fly zone is in effect. Driven by the March 12th endorsement of the Arab League, lukewarm as it was, President Obama has instituted the Libyan no fly zone—a huge gamble that if nothing else, places American pilots at grave risk.
There is now however, a veneer of legality for the action, given the UN approval, the position taken by the Arab League and the participation of some Arab states in the coalition formed to patrol and enforce the no fly zone. But the consequences of this action remain difficult to predict.
Not everyone however is in favor of a no fly zone in Libya. Even as coalition pilots enforce the no fly zone, China and Russia lead the case for the opposing viewpoint. Neither of them has ever embraced the concept of a planet earth police force but instead has continuously insisted on the inviolability of national borders. Also, several of the so called “non-aligned” countries like Brazil and South Africa are skeptical, to say the least.
There is however one thing that is relatively easy to predict—at least one presumptive Republican candidate for President in 2012 has absolutely no answers. Earlier this month, former Speaker of the House Newt Gingrich was hammering President Obama for not intervening in Libya. Asked then what he would do about Libya Gingrich responded “Exercise a no-fly zone this evening…We do not need to have the United Nations. All we have to say is that we think that slaughtering your own citizens is unacceptable and that we’re intervening.”
During appearances that same day, Gingrich also said that he would provide help to the Libyan rebels on top of the no-fly zone, “This is a moment to get rid of him. Do it. Get it over with.” He later mocked President Obama for filling out an NCAA bracket while France took the lead on intervention.
Now that Obama has initiated a no-fly zone over Libya, Gingrich has completely reversed his position with no apparent explanation. He told the web-based news service Politico over this past weekend—less than 24 hours after President Obama took action that “it is impossible to make sense of the standard for intervention in Libya except for opportunism and news media publicity.” This morning (March 23rd) on the Today Show, he said plainly, “I would not have intervened.”
It is nice to know that there are still some things we can all depend on.
Not that long ago, when the global community agonized over the horrors taking place in Rwanda and Bosnia, observing as some kind of disinterested bystander while mass slaughter took place unchallenged by anyone, there was real support for the idea in the late 1990s that the international community did after all have a collective “responsibility to protect” people if their respective national governments failed to do so.
Then there was the long, bloody catastrophe that began with the US invasion of Iraq and the idea of a “kind and just war” became passé. The 2003 Iraqi invasion was justified by the George W Bush administration by claims of weapons of mass destruction (WMD), but when the WMD failed to materialize, both the United States and the United Kingdom attempted to play the humanitarian card by claiming they were in fact “liberating the Iraqi people.”
With the outbreak of the Libyan conflict, the pendulum has swung back towards action, but only part of the way. Britain’s conservative prime-minister, David Cameron, who until recently spoke out vehemently against any kind of meddling in Libya, is now maintaining that military intervention in the form of a no fly zone is necessary and is its most passionate supporter. He is joined, ironically enough, by the President of France, Nicolas Sarkozy whose government is deftly trying to shed its image in the Middle East as Gadaffi’s best friend.
In between all this, is an agonized Washington, D.C., which would of course ultimately finance, manage and carry most of the political and emotional baggage for a no fly zone. As always, Washington is divided between humanitarian idealists, hard-headed realists and the ever popular undecided contingent.
President Obama’s dilemma was further exacerbated by the muddiness of the whole thing. Gadaffi’s air force had not yet caused huge numbers of civilian casualties. The threat of that is ever present however and what his planes had managed to do, at least up until March 19th, was to keep the rag tag rebels under cover—unable to come out and fight. And, despite the Arab League’s endorsement of a no fly zone on March 12th, their views are still mixed and seem to go back and forth with the time of day.
Now however, all bets are off and the no fly zone is in effect. Driven by the March 12th endorsement of the Arab League, lukewarm as it was, President Obama has instituted the Libyan no fly zone—a huge gamble that if nothing else, places American pilots at grave risk.
There is now however, a veneer of legality for the action, given the UN approval, the position taken by the Arab League and the participation of some Arab states in the coalition formed to patrol and enforce the no fly zone. But the consequences of this action remain difficult to predict.
Not everyone however is in favor of a no fly zone in Libya. Even as coalition pilots enforce the no fly zone, China and Russia lead the case for the opposing viewpoint. Neither of them has ever embraced the concept of a planet earth police force but instead has continuously insisted on the inviolability of national borders. Also, several of the so called “non-aligned” countries like Brazil and South Africa are skeptical, to say the least.
There is however one thing that is relatively easy to predict—at least one presumptive Republican candidate for President in 2012 has absolutely no answers. Earlier this month, former Speaker of the House Newt Gingrich was hammering President Obama for not intervening in Libya. Asked then what he would do about Libya Gingrich responded “Exercise a no-fly zone this evening…We do not need to have the United Nations. All we have to say is that we think that slaughtering your own citizens is unacceptable and that we’re intervening.”
During appearances that same day, Gingrich also said that he would provide help to the Libyan rebels on top of the no-fly zone, “This is a moment to get rid of him. Do it. Get it over with.” He later mocked President Obama for filling out an NCAA bracket while France took the lead on intervention.
Now that Obama has initiated a no-fly zone over Libya, Gingrich has completely reversed his position with no apparent explanation. He told the web-based news service Politico over this past weekend—less than 24 hours after President Obama took action that “it is impossible to make sense of the standard for intervention in Libya except for opportunism and news media publicity.” This morning (March 23rd) on the Today Show, he said plainly, “I would not have intervened.”
It is nice to know that there are still some things we can all depend on.
Saturday, March 19, 2011
What Can We Learn from the Horrible Japanese Nuclear Disaster?
As the world trembles while witnessing the terrible aftermath of the earthquake and tsunami that recently hit Japan and specifically the possible meltdowns of several nuclear reactors that were directly in the path of the tsunami wave, it is natural to ask about the safety systems in place for America’s nuclear power generating facilities. Some of what we are asking ourselves surrounds such issues as: What safety procedures are in place at our nuclear plants and is there any amount of engineering that can plan for the multitude of disaster scenarios that are playing out in Japan today? What should the Japanese nuclear reactor crisis mean to America and the rest of the world?
The hydrogen explosions, melting fuel rods and radiation leaks at Japan’s Fukushima Daiichi nuclear plant are having an immediate impact on perceptions of nuclear power worldwide as many countries are desperately searching for alternatives to fossil fuels. Safety has always been and will continue to be a major concern, particularly now as emergency workers in Japan continue struggling to keep spent fuel rods that were stored on site at Fukushima Daiichi from melting down.
Even before this latest disaster in the world of nuclear powered energy could be brought under control and investigated, Germany, earlier this week became the first European country to shut down seven of its nuclear plants that went online prior to 1980 in the wake of the crisis in Japan as the European Union almost simultaneously announced plans to test all 143 nuclear power plants in its 27 countries.
In the United States, the Nuclear Regulatory Commission (NRC) announced this past Thursday that it was cancelling next week’s meeting to discuss a restart of Progress Energy’s Crystal River plant on Florida’s west coast after the company reported problems with repair work on a containment wall. Crystal River shut down in the fall of 2009 for “a planned refueling that included the replacement of steam generators.” To install the new generators, workers needed to remove concrete in the containment wall and it was during this task that they discovered “a gap” in the wall.
Entergy Corporation, which just last week had received NRC approval for a 20-year operating license extension at its Vermont Yankee plant, must now, in the wake of Japan’s crisis obtain final approval from Vermont lawmakers, who in 2010 voted against re-licensing the facility after 2012. Three other Entergy nuclear sites, including New York’s controversial Indian Point, are also up for license extensions.
When asked what the incident at the Fukushima Daiichi plant means for the nuclear industry in Japan and the rest of the world, Najmedin Meshkati, a professor of civil, environmental, industrial and systems engineering at the University of Southern California’s Viterbi School of Engineering in Los Angeles made the following response: “It’s too soon to make a judgment on its impact on the nuclear renaissance that started in the United States five or six years ago. The most accurate statement I can make is that it’s going to seriously hamper the expected growth rate of this movement. On the other hand, it’s going to really put more scrutiny on nuclear safety related issues, which is not bad. In particular, the storage of spent nuclear fuel at plant sites should be reexamined. One of the most serious problems happening in Fukushima Daiichi is the spent fuel pool fire at the fourth reactor. We have likewise been storing spent nuclear fuel at our nuclear plant sites since the country first began using nuclear energy. This poses a serious safety problem and a serious safety risk of a terrorist attack to get these materials.”
In 1982, a decision was made by the United States Department of Energy to build a permanent nuclear waste repository. Most Americans can remember that in 2002, President George W. Bush approved Nevada’s Yucca Mountain, approximately 256 miles northwest of Las Vegas, as the site and to move nuclear waste there.
Due to a combination of incompetence, political fighting, partisan bickering and bureaucracy within the Department of Energy however, that site is still in limbo today. One positive outcome of the Japan disaster may very well be that discussions regarding Yucca Mountain as a repository for spent fuel rods might be revived. Had there not been spent fuel stored at the Fukushima plant, the Japanese government might not be faced with so many diverse challenges today.
For all 65 nuclear sites in the U.S. there are resident NRC inspectors at the different sites. When a nuclear site applies for a license extension or for basically getting a new extension on the life of the reactor, they need to go through a very rigorous risk analysis of their “reactor vessel” and other hardware. For example, a reactor vessel becoming brittle is a major issue. Ironically, there has been some discussion in the United States, even before the Japanese crisis, to change this regulation to one that is less rigorous and more “risk-based.”
One of the reasons to use risk-based analysis is to save money and to make regulations more “reasonable.” The risk-based approach gained some popularity during the George W. Bush administration because they wanted to get away from the “heavy hand of the regulator.” But experts like Professor Meshkati question its robustness when quantifying the contributions of human and organizational error to failures within the nuclear industry.
By comparison, the U.S. Federal Aviation Administration (FAA) follows an “absolute decision-making model,” which requires checks of passenger aircraft at prescribed periods. One of these checks occurs every 12 to 18 months, after a specific number of flight hours. During this prescribed inspection, aircraft mechanics and technicians take the aircraft to a maintenance hangar, strip it down and replace any number of parts based on the number of hours of flight—not necessarily waiting until they spot a defect or in response to a part’s failure.
As the world’s third largest economy, Japan is facing more than one kind of meltdown. In its first joint action in over a decade, the Group of Seven (G7) sold yen to halt its rise and help spur Japanese exports. The decision on Friday night (March 18th) to step in and try to control a rapidly appreciating Japanese yen is an indicator of how serious the problem is. The yen spiked to levels not seen since World War II earlier this week, mostly a panic reaction by currency traders, but a potential threat to the Japanese economy as it tries to remain strong and viable.
The reality is that while a strong yen might sound good in and of itself, it also has the impact of making Japanese products more expensive outside of Japan. Toyota has estimated that “for every yen the currency rises against the dollar, the company loses 30 billion yen in earnings” (today’s exchange rate is just around 90 yen equaling one dollar). Consequently, the G7 has stepped in with a plan to sell off yen, pushing it down against the dollar and the Euro.
Just yesterday, Japanese engineers conceded that burying a crippled nuclear reactor in sand and concrete may be the only way to prevent a catastrophic radiation leak. This is in fact, the method used to seal huge leakages from Chernobyl in 1986.
Japanese officials added that they still hoped to repair a power cable to reactors, enabling them to restart water pumps that are desperately needed to cool overheating nuclear fuel rods. Workers also sprayed water on the number three reactor, one of the most critical of the plant’s total of six. This bit of news while sounding positive is also proof that the use of helicopters dumping water on the reactors fuel rods has been thus far, totally unsuccessful.
The plight of hundreds of thousands of Japanese people left homeless by the earthquake and resulting tsunami worsened following a cold snap that has brought heavy snow to the worst-affected areas of the country. Supplies of water, heating oil and fuel are low at evacuation centers where many survivors wait huddled close together and bundled in blankets.
Tohuku Electric Power reported that approximately 30,000 homes in the north of Japan were still without electricity in near-freezing weather while the government added that at least 1.6 million households are without running water.
The National Police Agency reported yesterday that it has confirmed 5,692 deaths from the earthquake and tsunami disaster, while 9,522 are still unaccounted for.
The hydrogen explosions, melting fuel rods and radiation leaks at Japan’s Fukushima Daiichi nuclear plant are having an immediate impact on perceptions of nuclear power worldwide as many countries are desperately searching for alternatives to fossil fuels. Safety has always been and will continue to be a major concern, particularly now as emergency workers in Japan continue struggling to keep spent fuel rods that were stored on site at Fukushima Daiichi from melting down.
Even before this latest disaster in the world of nuclear powered energy could be brought under control and investigated, Germany, earlier this week became the first European country to shut down seven of its nuclear plants that went online prior to 1980 in the wake of the crisis in Japan as the European Union almost simultaneously announced plans to test all 143 nuclear power plants in its 27 countries.
In the United States, the Nuclear Regulatory Commission (NRC) announced this past Thursday that it was cancelling next week’s meeting to discuss a restart of Progress Energy’s Crystal River plant on Florida’s west coast after the company reported problems with repair work on a containment wall. Crystal River shut down in the fall of 2009 for “a planned refueling that included the replacement of steam generators.” To install the new generators, workers needed to remove concrete in the containment wall and it was during this task that they discovered “a gap” in the wall.
Entergy Corporation, which just last week had received NRC approval for a 20-year operating license extension at its Vermont Yankee plant, must now, in the wake of Japan’s crisis obtain final approval from Vermont lawmakers, who in 2010 voted against re-licensing the facility after 2012. Three other Entergy nuclear sites, including New York’s controversial Indian Point, are also up for license extensions.
When asked what the incident at the Fukushima Daiichi plant means for the nuclear industry in Japan and the rest of the world, Najmedin Meshkati, a professor of civil, environmental, industrial and systems engineering at the University of Southern California’s Viterbi School of Engineering in Los Angeles made the following response: “It’s too soon to make a judgment on its impact on the nuclear renaissance that started in the United States five or six years ago. The most accurate statement I can make is that it’s going to seriously hamper the expected growth rate of this movement. On the other hand, it’s going to really put more scrutiny on nuclear safety related issues, which is not bad. In particular, the storage of spent nuclear fuel at plant sites should be reexamined. One of the most serious problems happening in Fukushima Daiichi is the spent fuel pool fire at the fourth reactor. We have likewise been storing spent nuclear fuel at our nuclear plant sites since the country first began using nuclear energy. This poses a serious safety problem and a serious safety risk of a terrorist attack to get these materials.”
In 1982, a decision was made by the United States Department of Energy to build a permanent nuclear waste repository. Most Americans can remember that in 2002, President George W. Bush approved Nevada’s Yucca Mountain, approximately 256 miles northwest of Las Vegas, as the site and to move nuclear waste there.
Due to a combination of incompetence, political fighting, partisan bickering and bureaucracy within the Department of Energy however, that site is still in limbo today. One positive outcome of the Japan disaster may very well be that discussions regarding Yucca Mountain as a repository for spent fuel rods might be revived. Had there not been spent fuel stored at the Fukushima plant, the Japanese government might not be faced with so many diverse challenges today.
For all 65 nuclear sites in the U.S. there are resident NRC inspectors at the different sites. When a nuclear site applies for a license extension or for basically getting a new extension on the life of the reactor, they need to go through a very rigorous risk analysis of their “reactor vessel” and other hardware. For example, a reactor vessel becoming brittle is a major issue. Ironically, there has been some discussion in the United States, even before the Japanese crisis, to change this regulation to one that is less rigorous and more “risk-based.”
One of the reasons to use risk-based analysis is to save money and to make regulations more “reasonable.” The risk-based approach gained some popularity during the George W. Bush administration because they wanted to get away from the “heavy hand of the regulator.” But experts like Professor Meshkati question its robustness when quantifying the contributions of human and organizational error to failures within the nuclear industry.
By comparison, the U.S. Federal Aviation Administration (FAA) follows an “absolute decision-making model,” which requires checks of passenger aircraft at prescribed periods. One of these checks occurs every 12 to 18 months, after a specific number of flight hours. During this prescribed inspection, aircraft mechanics and technicians take the aircraft to a maintenance hangar, strip it down and replace any number of parts based on the number of hours of flight—not necessarily waiting until they spot a defect or in response to a part’s failure.
As the world’s third largest economy, Japan is facing more than one kind of meltdown. In its first joint action in over a decade, the Group of Seven (G7) sold yen to halt its rise and help spur Japanese exports. The decision on Friday night (March 18th) to step in and try to control a rapidly appreciating Japanese yen is an indicator of how serious the problem is. The yen spiked to levels not seen since World War II earlier this week, mostly a panic reaction by currency traders, but a potential threat to the Japanese economy as it tries to remain strong and viable.
The reality is that while a strong yen might sound good in and of itself, it also has the impact of making Japanese products more expensive outside of Japan. Toyota has estimated that “for every yen the currency rises against the dollar, the company loses 30 billion yen in earnings” (today’s exchange rate is just around 90 yen equaling one dollar). Consequently, the G7 has stepped in with a plan to sell off yen, pushing it down against the dollar and the Euro.
Just yesterday, Japanese engineers conceded that burying a crippled nuclear reactor in sand and concrete may be the only way to prevent a catastrophic radiation leak. This is in fact, the method used to seal huge leakages from Chernobyl in 1986.
Japanese officials added that they still hoped to repair a power cable to reactors, enabling them to restart water pumps that are desperately needed to cool overheating nuclear fuel rods. Workers also sprayed water on the number three reactor, one of the most critical of the plant’s total of six. This bit of news while sounding positive is also proof that the use of helicopters dumping water on the reactors fuel rods has been thus far, totally unsuccessful.
The plight of hundreds of thousands of Japanese people left homeless by the earthquake and resulting tsunami worsened following a cold snap that has brought heavy snow to the worst-affected areas of the country. Supplies of water, heating oil and fuel are low at evacuation centers where many survivors wait huddled close together and bundled in blankets.
Tohuku Electric Power reported that approximately 30,000 homes in the north of Japan were still without electricity in near-freezing weather while the government added that at least 1.6 million households are without running water.
The National Police Agency reported yesterday that it has confirmed 5,692 deaths from the earthquake and tsunami disaster, while 9,522 are still unaccounted for.
Thursday, March 10, 2011
How the Political Upheaval in the Middle East Impacts the American Pocketbook
The first thing we must do is separate the wheat from the chaff. Libya is different. Unlike the toppling of dictators in Tunisia and Egypt, and the continuing unrest in Bahrain and yes, Iran, the violence that has erupted in Libya, the 18th largest oil producer in the world, will have a more immediate and sustaining impact on the American pocketbook.
That became all too clear when on March 2nd, the Financial Times reported that half of Libya’s oil producing capacity had shut down, causing an immediate shockwave in the oil industry resulting in oil prices escalating to $100 per barrel. Added to that is the fear that the current turmoil in Libya could spread to other major oil producers in the Middle East such as Saudi Arabia and possibly even Algeria.
As if to fuel the fire (pun intended), TIME Magazine reported last week that Colonel Moammar Gadhafi has also threatened to “blow up” Libyan energy pipelines.
As I shared with you last week, Libya produces just 2 percent of the world’s oil, but, it is some of the world’s most sought after highest quality crude. Today, Libya exports 85 percent of its oil to Europe while only sending five percent of its output to the United States.
On March 2nd, International Energy Agency (IEA) chief economist Fatih Birol said that oil prices are right now in the “danger zone and could rise further if the turbulence continues in the Middle East.”
All of this political upheaval in the Middle East has certainly shed the light on the reality of our dependence on foreign oil and the limits of the oil reserves themselves. While neither Egypt nor Tunisia are meaningful oil producers, Egypt is certainly the region’s chief refiner of crude while Libya is an important oil and gas producer. As we have all learned the hard way, the oil industry is a very complex industry and its performance is driven in large part by how politically stable the planet is. Unfortunately, for as much oil as we consume, Americans have little knowledge of how the oil market functions and we really don’t have any appreciation for oil politics and economics until we pull up to the gas station and are either unable to pump or are forced to pay a huge price.
The unfortunate reality is that we as a people are largely clueless as to the correlation between the oil industry and our lives. We are ridiculously dependent on foreign countries for oil and the oil producing world is rapidly running out of cheap, easy to produce, high-quality sweet crude oil. The oil that is left is of a poor quality, is more expensive to produce and is frighteningly found in forbidding and difficult regions.
Right now, oil prices are escalating because there is a growing sense that the entire Middle East has become horribly unstable and that no one, and I mean no one, has any idea what the outcome will be. As far as Libya goes, it is very hard for the world to absorb even a two percent reduction in oil production. Industrial economies all over the world tremble at the thought of this kind of loss. For many years, oil production and consumption were relatively balanced, but now oil reserves are dwindling while the world is simultaneously consuming more oil. The Chinese people purchased more cars last year than we did here in the United States.
Just watching local news will inform you how the crisis has deepened. Among the first to suffer in an environment of escalating oil prices is the American trucker. They have to pay for their own diesel fuel and they will be unable to absorb the kind or price increases we are beginning to see right now. It cannot be overstated how much merchandise, goods and products truckers move around America. If they become unable to cope with rising oil prices, the goods are not going to make it to the supermarket. If that happens, then the stores have a problem and companies will be unable to pay their employees because without product to sell, there is no income for the supermarket.
If all this was not enough to worry about, there are other scenarios to be frightened of as well. The upheaval in Libya right now will only serve to inflame the region more. The more Colonel Gadhafi resists the wish of his people to step down and the more violence he provokes against his own countrymen, the more it will only anger and inspire people in neighboring countries. Saudi Arabia is extremely vulnerable. The King is over 86 years old and not in the best of health and his successor is over 85! There are branches of the Royal Saudi family that would love to see change at the top. If Saudi Arabia becomes too turbulent, it will be virtually impossible for the oil industry to function there. And, Saudi Arabia is our second largest supplier of oil.
Then there is the issue of “peak oil.” This is the point of maximum oil production, either in a country, region or the world as a whole. Once you peak in your oil production, then the oil producer begins the slippery slide into an “arc of depletion.” Some experts calculate that only about half of the world’s oil supply is left. What causes the most dismay however is the reality that of this oil that is still in the ground, a very large percentage is economically unreachable for one reason or another. Add to that a chaotic international banking system; oil consuming nations are in a state of crisis regarding capital which can only mean that we are struggling to raise the money to even get to what is left out of the ground.
Should you be one of those who think technology will ride to the rescue, think again. The problem of the diminishing returns of the new technologies designed to drill more aggressively by horizontal drilling or even injecting nitrogen or seawater into rock to squeeze every drop of oil out of that rock just ends up depleting the oil fields more. The Saudis have already depleted their fields that way. In fact, they are no longer the number one producer of oil—Russia is.
Some think that we will be able to identify and develop alternative energy sources. This may actually be part of the answer but we need to first finally accept the reality that to drastically reduce our dependency on oil there are behavioral changes we all have to make. Walk more; drive less; bring back America’s trains without necessarily building them to be bullet trains; and turn to public transportation for the vast majority of our intra-city trips.
Of the roughly 16 million barrels a day of crude oil consumed in the U.S., about two-thirds of it ends up being used as fuel for transportation. Until we can figure out a way to run cars on electricity, or make the cars and trucks we drive go further on less fuel, we’ll have a hard time weaning ourselves from oil.
That’s why alternate energy sources like wind and solar – which are used to make electricity – aren’t replacing nearly enough oil fast enough to kick our addiction to crude.
As always, I look forward to sharing with you again next week—right now however, I have to go and gas up.
That became all too clear when on March 2nd, the Financial Times reported that half of Libya’s oil producing capacity had shut down, causing an immediate shockwave in the oil industry resulting in oil prices escalating to $100 per barrel. Added to that is the fear that the current turmoil in Libya could spread to other major oil producers in the Middle East such as Saudi Arabia and possibly even Algeria.
As if to fuel the fire (pun intended), TIME Magazine reported last week that Colonel Moammar Gadhafi has also threatened to “blow up” Libyan energy pipelines.
As I shared with you last week, Libya produces just 2 percent of the world’s oil, but, it is some of the world’s most sought after highest quality crude. Today, Libya exports 85 percent of its oil to Europe while only sending five percent of its output to the United States.
On March 2nd, International Energy Agency (IEA) chief economist Fatih Birol said that oil prices are right now in the “danger zone and could rise further if the turbulence continues in the Middle East.”
All of this political upheaval in the Middle East has certainly shed the light on the reality of our dependence on foreign oil and the limits of the oil reserves themselves. While neither Egypt nor Tunisia are meaningful oil producers, Egypt is certainly the region’s chief refiner of crude while Libya is an important oil and gas producer. As we have all learned the hard way, the oil industry is a very complex industry and its performance is driven in large part by how politically stable the planet is. Unfortunately, for as much oil as we consume, Americans have little knowledge of how the oil market functions and we really don’t have any appreciation for oil politics and economics until we pull up to the gas station and are either unable to pump or are forced to pay a huge price.
The unfortunate reality is that we as a people are largely clueless as to the correlation between the oil industry and our lives. We are ridiculously dependent on foreign countries for oil and the oil producing world is rapidly running out of cheap, easy to produce, high-quality sweet crude oil. The oil that is left is of a poor quality, is more expensive to produce and is frighteningly found in forbidding and difficult regions.
Right now, oil prices are escalating because there is a growing sense that the entire Middle East has become horribly unstable and that no one, and I mean no one, has any idea what the outcome will be. As far as Libya goes, it is very hard for the world to absorb even a two percent reduction in oil production. Industrial economies all over the world tremble at the thought of this kind of loss. For many years, oil production and consumption were relatively balanced, but now oil reserves are dwindling while the world is simultaneously consuming more oil. The Chinese people purchased more cars last year than we did here in the United States.
Just watching local news will inform you how the crisis has deepened. Among the first to suffer in an environment of escalating oil prices is the American trucker. They have to pay for their own diesel fuel and they will be unable to absorb the kind or price increases we are beginning to see right now. It cannot be overstated how much merchandise, goods and products truckers move around America. If they become unable to cope with rising oil prices, the goods are not going to make it to the supermarket. If that happens, then the stores have a problem and companies will be unable to pay their employees because without product to sell, there is no income for the supermarket.
If all this was not enough to worry about, there are other scenarios to be frightened of as well. The upheaval in Libya right now will only serve to inflame the region more. The more Colonel Gadhafi resists the wish of his people to step down and the more violence he provokes against his own countrymen, the more it will only anger and inspire people in neighboring countries. Saudi Arabia is extremely vulnerable. The King is over 86 years old and not in the best of health and his successor is over 85! There are branches of the Royal Saudi family that would love to see change at the top. If Saudi Arabia becomes too turbulent, it will be virtually impossible for the oil industry to function there. And, Saudi Arabia is our second largest supplier of oil.
Then there is the issue of “peak oil.” This is the point of maximum oil production, either in a country, region or the world as a whole. Once you peak in your oil production, then the oil producer begins the slippery slide into an “arc of depletion.” Some experts calculate that only about half of the world’s oil supply is left. What causes the most dismay however is the reality that of this oil that is still in the ground, a very large percentage is economically unreachable for one reason or another. Add to that a chaotic international banking system; oil consuming nations are in a state of crisis regarding capital which can only mean that we are struggling to raise the money to even get to what is left out of the ground.
Should you be one of those who think technology will ride to the rescue, think again. The problem of the diminishing returns of the new technologies designed to drill more aggressively by horizontal drilling or even injecting nitrogen or seawater into rock to squeeze every drop of oil out of that rock just ends up depleting the oil fields more. The Saudis have already depleted their fields that way. In fact, they are no longer the number one producer of oil—Russia is.
Some think that we will be able to identify and develop alternative energy sources. This may actually be part of the answer but we need to first finally accept the reality that to drastically reduce our dependency on oil there are behavioral changes we all have to make. Walk more; drive less; bring back America’s trains without necessarily building them to be bullet trains; and turn to public transportation for the vast majority of our intra-city trips.
Of the roughly 16 million barrels a day of crude oil consumed in the U.S., about two-thirds of it ends up being used as fuel for transportation. Until we can figure out a way to run cars on electricity, or make the cars and trucks we drive go further on less fuel, we’ll have a hard time weaning ourselves from oil.
That’s why alternate energy sources like wind and solar – which are used to make electricity – aren’t replacing nearly enough oil fast enough to kick our addiction to crude.
As always, I look forward to sharing with you again next week—right now however, I have to go and gas up.
Friday, March 4, 2011
Let's Start With the Basics
For those of you who did not read my blog last week (shame on you), this is how I ended the post, “The constant in this whole crisis is that when gasoline costs more it has a negative effect on economic growth. Almost all economic activities include the use of oil in one form or another. Consequently, when the price of oil begins getting high, it motivates all of us to start cutting back on many of these activities. What then is the answer? I have no idea.”
When I wrote those words, I thought, “Hey, I never said I always have the answer. It is ok to every now and then simply not have a clue.”
Since last Thursday however, I have had somewhat of a change of heart. So I began practically the next day doing what I do best—research. And while I still do not have all the answers, I think I do have the beginning of a slightly better understanding of the dynamics of how this most recent Middle East crisis is impacting the American family’s pocketbook. So let’s start with the basics.
A careful analysis of the economic indicators coming out of Western economies today is somewhat confusing. All indicators point to a sluggish but persistent recovery process from the debacle of the worldwide economic disaster of 2007 through 2010 but people are still out of work. Unemployment is still unacceptably high which can mean only one thing—that the numbers are somewhat of a false positive. Core asset values which are those assets that are designed to produce long-term profit growth are not increasing in value. In some cases, they are even decreasing in value, a situation that will not allow sustainable growth on any level.
Regarding banking and financial services, the current set of policies within that sector will ensure banking and financial service profits in the near term which in effect will create wealth for only a very small segment of the American economy. The Obama administration claims it is fighting for the middle class, but is in reality implementing policy that in effect creates wealth for only those at the top of the economic ladder. Meanwhile, the major banks are making money by trading on of all things, U.S. deficits and monetary policy which of course does absolutely nothing for America’s either long or short-term economic health.
Maddeningly, the European Union (EU) has done a better job of handling their sovereign debt and central banking policy. Worse, the Europeans management of their own crisis in part is driven by how poorly we have managed ours and so consequently they have benefited from disastrous U.S. policies. A case in point is how the Germans have continued throughout the crisis to support the EU on one hand, but then take a strong industrialist approach regarding their own economy by staying almost completely away from any kind of government stimulus and have thus become one of the best growth economies in the “non-emerging world.”
The best guess of some pretty smart American economists is that we probably have no more than two years to make drastic changes to deficits, monetary policy and our tax structure if the economy has any hope of long-term and sustainable growth and that when all is said and done, it is not the school teacher or highway worker that will send the U.S. economy into a ditch of depression.
The recent protests that have already resulted in some government turn-over in the Middle East starts with little economic stability within those countries and because their main commodity is oil, Western economies can probably sustain no more than three or four years of less than stable Middle Eastern economies.
On the flip side, the news is not good for America either. China will continue to grow and due to their internal economic demand, should surpass our economy as the world’s top economy within this decade. And as President Obama has stressed over and over the importance of understanding the energy sector, China will continue to operate in unfettered oil, gas and coal utilization operations (not necessarily the best news for the Chinese labor force). The Chinese will also become a major world player in the critical sub-sectors of oil field services (e.g. refining) and more than likely overtake America in this sector-defined technology as well within the next three or four years.
Despite the screaming from the Right and their newly elected charges in both Houses of Congress, the greatest challenge facing the Obama administration today is in fact, the current Middle East crisis. President Obama is walking a fine line between stability and democracy while one of its strongest allies in the Region, the state of Israel, will be in its most vulnerable position since the early seventies because one of the real dangerous outcomes of this current crisis could be that the young people in the street who are idealists and have thus far spearheaded the revolutionary activity throughout the Middle East, could be swept aside by fellow citizens in alliance with radical clerics which might usher in the kind of theological government reminiscent of the Iranian Revolution of 1979. Unemployment, starving, loss of basic freedoms are all ingredients that when mixed together result in revolt so watch closely those countries in the Middle East Region with the highest unemployment and most fundamental needs.
The Middle East Region has consistently posed strategic dilemmas not only to the United States but also other global players which have strategic interests in the Region. The Middle East has even posed strategic dilemmas to nations of the Middle East themselves.
The United States as the lead player in global power calculus and the Superpower with a constant strategic predominance in the Region should not shy away from the political challenges that are unfolding. The United States has in itself the determination and comprehensive power strengths to carefully help shape the Middle East for greater global good.
The Middle East Region being at a “Tipping Point” as the current political upheaval indicates, demands that the United States correctly read the imperatives that suggest we prudently move to being on the right side of history, unlike our behavior towards Iran in 1979.
More next week specifically on what this all means to our pocketbooks...
When I wrote those words, I thought, “Hey, I never said I always have the answer. It is ok to every now and then simply not have a clue.”
Since last Thursday however, I have had somewhat of a change of heart. So I began practically the next day doing what I do best—research. And while I still do not have all the answers, I think I do have the beginning of a slightly better understanding of the dynamics of how this most recent Middle East crisis is impacting the American family’s pocketbook. So let’s start with the basics.
A careful analysis of the economic indicators coming out of Western economies today is somewhat confusing. All indicators point to a sluggish but persistent recovery process from the debacle of the worldwide economic disaster of 2007 through 2010 but people are still out of work. Unemployment is still unacceptably high which can mean only one thing—that the numbers are somewhat of a false positive. Core asset values which are those assets that are designed to produce long-term profit growth are not increasing in value. In some cases, they are even decreasing in value, a situation that will not allow sustainable growth on any level.
Regarding banking and financial services, the current set of policies within that sector will ensure banking and financial service profits in the near term which in effect will create wealth for only a very small segment of the American economy. The Obama administration claims it is fighting for the middle class, but is in reality implementing policy that in effect creates wealth for only those at the top of the economic ladder. Meanwhile, the major banks are making money by trading on of all things, U.S. deficits and monetary policy which of course does absolutely nothing for America’s either long or short-term economic health.
Maddeningly, the European Union (EU) has done a better job of handling their sovereign debt and central banking policy. Worse, the Europeans management of their own crisis in part is driven by how poorly we have managed ours and so consequently they have benefited from disastrous U.S. policies. A case in point is how the Germans have continued throughout the crisis to support the EU on one hand, but then take a strong industrialist approach regarding their own economy by staying almost completely away from any kind of government stimulus and have thus become one of the best growth economies in the “non-emerging world.”
The best guess of some pretty smart American economists is that we probably have no more than two years to make drastic changes to deficits, monetary policy and our tax structure if the economy has any hope of long-term and sustainable growth and that when all is said and done, it is not the school teacher or highway worker that will send the U.S. economy into a ditch of depression.
The recent protests that have already resulted in some government turn-over in the Middle East starts with little economic stability within those countries and because their main commodity is oil, Western economies can probably sustain no more than three or four years of less than stable Middle Eastern economies.
On the flip side, the news is not good for America either. China will continue to grow and due to their internal economic demand, should surpass our economy as the world’s top economy within this decade. And as President Obama has stressed over and over the importance of understanding the energy sector, China will continue to operate in unfettered oil, gas and coal utilization operations (not necessarily the best news for the Chinese labor force). The Chinese will also become a major world player in the critical sub-sectors of oil field services (e.g. refining) and more than likely overtake America in this sector-defined technology as well within the next three or four years.
Despite the screaming from the Right and their newly elected charges in both Houses of Congress, the greatest challenge facing the Obama administration today is in fact, the current Middle East crisis. President Obama is walking a fine line between stability and democracy while one of its strongest allies in the Region, the state of Israel, will be in its most vulnerable position since the early seventies because one of the real dangerous outcomes of this current crisis could be that the young people in the street who are idealists and have thus far spearheaded the revolutionary activity throughout the Middle East, could be swept aside by fellow citizens in alliance with radical clerics which might usher in the kind of theological government reminiscent of the Iranian Revolution of 1979. Unemployment, starving, loss of basic freedoms are all ingredients that when mixed together result in revolt so watch closely those countries in the Middle East Region with the highest unemployment and most fundamental needs.
The Middle East Region has consistently posed strategic dilemmas not only to the United States but also other global players which have strategic interests in the Region. The Middle East has even posed strategic dilemmas to nations of the Middle East themselves.
The United States as the lead player in global power calculus and the Superpower with a constant strategic predominance in the Region should not shy away from the political challenges that are unfolding. The United States has in itself the determination and comprehensive power strengths to carefully help shape the Middle East for greater global good.
The Middle East Region being at a “Tipping Point” as the current political upheaval indicates, demands that the United States correctly read the imperatives that suggest we prudently move to being on the right side of history, unlike our behavior towards Iran in 1979.
More next week specifically on what this all means to our pocketbooks...
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