Tag Archives: Horsford

Amodei and Heck Do It Again!

Pollution air In case you missed it —  amidst all the publicity about the pipeline vote – the House of Representatives has again demonstrated its proclivity to promote the interests of corporate  exploiters and polluters (read — Koch Brothers):

“The House voted 229-191 to pass H.R. 1422, which would change the rules for appointing members to the Science Advisory Board (SAB), a group that gives scientific advice to the EPA Administrator. Also called the Science Advisory Board Reform Act, the bill would make it easier for scientists with financial ties to corporations to serve on the SAB, prohibit independent scientists from talking about their own research on the board, and make it more difficult for scientists who have applied for grants from the EPA to join the board.” [TP]

How nice for the Koch Brothers and the multi-national corporations which are annoyed by having to discuss such matters as global climate change, air pollution, and other topics related to whether or not our grandchildren will inherit a viable planet.

So, what did Representative Mark Amodei (R-NV2) do for the grandchildren?  He voted in favor of the Ignore The Science Bill.  Representatives Heck (R-NV3) and Amodei voted in favor of the bill on Roll Call 525.   Representatives Horsford (D-NV4) and Titus (D-NV1) thought enough of the kidlets to vote against this sop to multinational corporations. But wait! There’s more.

The House also passed H.R. 4795 – yet another pro-pollution bill:

“The Clean Air Act requires major new or expanding sources of air pollution to obtain permits with pollution limits before the facilities start construction.  These preconstruction permits ensure that a new or expanded facility will not increase local air pollution to levels that violate national ambient air quality standards (NAAQS), which the Environmental Protection Agency (EPA) sets for six principal air pollutants.  When EPA updates each air quality standard to reflect the latest science, permit applicants have to meet the new, more protective standard and show their emissions will not harm public health.

H.R. 4795, introduced by Rep. Steve Scalise (R-LA), creates a loophole in this process.  The bill establishes imprecise procedural requirements for EPA to follow after setting a new air quality standard.  If EPA does not meet those requirements, then a new or expanding facility can apply for a preconstruction permit based on the old air quality standard, which is not adequate to protect public health.  In effect, this bill could give new sources of pollution “amnesty” from new science-based air quality standards.”  [DEC]

Got that?  If Spew & Blow Corp. doesn’t like the new air quality standards, it can use the Scalise Loophole to get around them.  How convenient.  And what did our Representatives do?  The two Republicans (Heck and Amodei) voted for the “Promoting New Manufacturing Act” – the title should really have been the “Promoting More Pollution Act of 2014.”   Horsford and Titus both voted against this travesty of a bill.

Could we have any better demonstration of how closely Congressional Republicans, including our Congressional Republicans, are tied to the Koch Brothers?

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Filed under Amodei, ecology, Nevada politics, pollution

Here Comes The Dark Money

Dark Money Here comes the money – into the Nevada District 4 Congressional race:

“Crossroads GPS, a conservative group, said Tuesday it has bought $820,000 worth of TV time for ads to start airing today and run through Election Day on Nov. 4. A source familiar with the ad buy said it is aimed at Horsford, who represents the 4th Congressional District.

Paul Lindsay, communications director for Crossroads GPS, confirmed the group’s eleventh-hour spending plans for the campaign, which could be a game-changer, but offered no details.

“We have placed a buy in the Las Vegas media market and have an important message to communicate,” Lindsay said.” [LVRJ]

And what might the “important message” be? It’s that Representative Horsford is in the same political party as the President of the United States.  Horsford, the ads explain, supports the Affordable Care Act.  Yes, that’s the law which restrains some of the more egregious practices of health insurance corporations, requires that comprehensive insurance cover flu vaccinations, and autism screening, and makes shopping for private health care plans more convenient.   Then there’s the almost an outright lie.

The Affordable Care Act cut Medicare.” This prevarication has been one of the pillars of Republican opposition to the Affordable Care Act.  Those “cuts” actually: (1) Close the do-nut hole in Medicare Part D prescription coverage until the ‘hole’ is eliminated in 2020; (2) Expands existing coverage for senior citizens; (3) Supports initiatives to support care coordination; (4) Does not reduce benefits from Medicare Advantage (the private option to Medicare); (5) Reduces payments to Medicare Advantage rewarding those providers who improve the quality of their coverage, bringing payouts in line with other areas of Medicare; (6) Helps protect the Medicare trust fund.  [OFacts]

The “cuts” were made to over-payments to Medicare Advantage providers which were higher than payments made to Medicare providers – in essence supplying the private Medicare option with a public corporate subsidy. “Your” Medicare (Advantage) benefits weren’t cut!  What was cut were unjustifiable taxpayer subsidies to private health insurance corporations.   And, maybe we should be reminded that those same “cuts” about which Rove’s Dark Money ads are caterwauling, are the same “cuts” which appear in  Representative Paul Ryan’s budget plans?

Someone doesn’t like “cuts” made to the public funds available to private health care insurance corporations.  Who might that be? We’ll not know because Crossroads is a Dark Money 501 (c) 4 which doesn’t have to reveal the names of its donors. [IBT]  There’s nothing grass-roots about Rove’s organization which takes advantage of the decision in Citizens United to cover the tracks of mega-donors.

“The large donations may renew questions from Sunlight and others about whether Crossroads GPS should be able to file as a nonprofit “social welfare” group under the tax code, allowing it to avoid disclosing donor names. According to IRS regulations, the group’s “primary purpose” cannot be influencing elections, but the group can spend up to half of its money on political campaigning.” [WaPo] (emphasis added)

This goes toward explaining why the GOP was so anxious to attack the IRS for “politicizing” 501 (c) organization decisions?  There are legitimate questions about the “social welfare” activities of organizations like Crossroads GPS, and someone didn’t want those questions answered.

Republicans may see an opening in Nevada District 4 and are willing to unleash the Dark Side Money into the breach. We can hope that the constituent services, and the person campaign style of incumbent Representative Stephen Horsford can overcome the money accreting to the Tea Party Radical campaign of challenger Cresent “Segregation” Hardy.  [NVProg]

Early voting has started, and the GOP base is out in force – as usual – Every. Vote. Counts. GOTV.

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Filed under Nevada politics, Rove

What Our Representatives Did Before Vacation

Amodei 3 House leadership has taken the biennial pre-election vacation, in other words Representatives Heck, Amodei, Titus, and Horsford will be home to face the voters.  However, the House did leave with some parting gifts to corporate America which Representatives Heck and Amodei might wish to explain.

Parting gift (shot) number one: H.R. 4 the inaptly titled “Jobs for America Act.” What this might have to do with jobs is a mystery unless a person subscribes to the well debunked Trickle Down Hoax which says that the more tax breaks we give to corporations the more jobs will be created.  In this measure the research tax credit is made permanent, businesses can expense certain depreciable business assets, corporations are given permanent tax relief,  the bonus depreciation is modified and made permanent, the medical device tax is repealed, there are registration and reporting exemptions for private equity fund advisors, there are registration exemptions for merger and acquisition brokers, there are more reporting requirements on independent regulatory agencies and a retrospective analysis of existing federal regulations – (and what corporation doesn’t want ‘freedum’ from the SEC, the OCC, the FTC, the Consumer Safety Protection Bureau, the Consumer Financial Protection Bureau…) —

And, then there’s congressional review of agency rule making, a permanent moratorium on internet taxes (pro Big Box and Amazon), a land exchange authority to privatize public lands in Oregon and California, and provisions on judicial review of agency actions relating to exploration and mine permits.

In short – this is the exploiters, polluters, hedge fund and private equity wealth management lobbyists laundry list of Things We Want!  And, we like to have them now.  It’s just about every tax cut and deregulations idea ever expounded.   And, we know where tax cuts and deregulation got us in 2007-2008?

And, on September 18, 2014 the bill passed the Republican controlled House on a 253-163 vote.  [rc513] Representatives Amodei and Heck voted in favor of the H.R. 4 – the Exploiters, Polluters, Hedge Fund Managers, Merger and Acquisition Brokers Protection Act of 2014.   Representatives Titus and Horsford did not.  But wait, there’s more!

Parting gift (shot) number two:  The House also passed H.R. 2 the so-called  “American Energy Solutions for Lower Costs and More American Jobs Act.”  If you think this is about creating permanent and well paying jobs for American workers, please find a copy of the bill text – because this is not about lowering your energy costs, nor is it about getting anyone a job – it’s about approving the Keystone Pipeline.  That’s what the first section of the first part of the act is all about – approving the Keystone Pipeline to take Canadian oil to an International port.   Here’s an idea – if the Canadians want to pipe their oil to a port, how about they pipe it to one of their own ports?

And while they’re about it there are provisions in the bill to prohibit the consideration of social costs of carbon in any analysis, repeal of earlier rules and guidelines on energy efficiency, and then Drill Baby Drill anywhere, any place, any time.  This is the American Petroleum Institute’s dream bill. It’s a fossil fuel industry wet dream. And, it passed in the House 226 to 191.  Representatives Amodei and Heck voted in favor of the Drill Baby Drill/ Keystone Pipeline bill;  Representatives Titus and Horsford voted against it. [rc515]

Let’s guess that Representatives Heck and Amodei will come home to tell us they voted against those icky overburdening regulations on “Small Business In America” – the Norman Rockwell Painting People who run those Mom and Pop corner bodegas – not, so fast – the people they voted to protect are the corporate polluters, exploiters, hedge fund wealth management, merger and acquisition brokers, and Oil Giants.  This activity creates jobs, IF and ONLY IF we are foolish enough to believe that cutting taxes on major multi-national corporations creates jobs, and we know that doesn’t work.

The House had time to vote to protect the Oil Giants and the Major Corporations in H.R. 2 and H.R. 4, but they didn’t have time before vacation to take up:

  • The Voting Rights Act
  • Equal Pay for Equal Work
  • Comprehensive Immigration Reform
  • Student Loan Terms and Indebtedness

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Filed under Amodei, Congress, energy policy, financial regulation, Heck, House of Representatives

Amodei and the Perils of the Second Question

Amodei 3I lasted for two questions and Amodeian Answers during last evening’s telephone town hall session.  The Second Question I  heard was from “Dorothy from Fernley” asking: “I live in Lyon County, what does the government plan to do to bring jobs…”

The previous post described the nature of any response on offer from Nevada’s 2nd District Congressman, Mark Amodei (R-NV2).  So, imagine the serpentine syntax and the following reply:

Representative Amodei was quick to let the caller know that the House had just passed a Jobs Bill, one that was a “general measure, instead of extending unemployment benefits.”

The Congressman didn’t specify what bill that was, but might have been referring to the Highway Trust Fund bill, or to the Federal Register Act, but those aren’t generally classified as “jobs” bills by the Republican leadership.  The bill to which he was most likely referring was H.R. 4718, amending the IRS code to make bonus depreciation permanent.  The bill “generally” helps businesses, and is an exemplar of Trickle Down in its almost pure form.

The bill passed on an almost  party line vote 258-160. [roll call 404] The Nevada delegation supported the measure. So, what would it do?

One rather brutal way to describe the bill is that it adds some $287 billion to the Federal budget deficit without doing much more than allowing businesses to write off the costs of capital improvements and investments more quickly.  [HuffPo]

If a person is waiting for a job in Yerington, Fernley, or Silver Springs — this bill doesn’t shorten the time. First, the corporation would have to make a capital investment or improvement, and the investment would have to be an expansion, and if it were an expansion, then it would have to expand in Lyon County…. you get the picture.  Describing the bill as “generally” promoting jobs is generous indeed.

More importantly, under the Austerian/Trickle Down Theory of Republican economics this kind of measure is supposed to have an overall stimulative effect.  First, bonus depreciation breaks have been in effect from 2008 to 2013.  Secondly, according to the Congressional Research Service report, (pdf) they weren’t all that stimulative:

“A temporary investment subsidy was expected to be more effective than a permanent one for short-term stimulus, encouraging firms to invest while the benefit was in place. Its temporary nature is critical to its effectiveness. Yet, research suggests that bonus depreciation was not very effective, and probably less effective than the tax cuts or spending increases that have now lapsed.”

It was a bust.  However, it was a tax break and Republicans believe, as an article of faith, that all tax breaks have a stimulative effect on the economy.

Not only was it a bust, but at the moment it is an expensive bust; again according to the CRS analysis:

“If bonus depreciation is made permanent, it increases accelerated depreciation for equipment, contributing to lower, and in some cases more negative, effective tax rates. In contrast, prominent tax reform proposals would reduce accelerated depreciation. Making bonus depreciation a permanent provision would significantly increase its budgetary cost.”

Remember how all those major corporations are forever telling us that the are paying the highest corporate tax rate in the Universe and that they can’t compete with other corporations based in foreign lands?  Well, here’s a tax break they can enjoy:

“Compared to a statutory corporate tax rate of 35%, bonus depreciation lowers the effective tax rate for equipment from an estimated 26% rate to a 15% rate. Buildings are taxed approximately at the statutory rate. Total tax rates would be slightly higher because of stockholder taxes. Because nominal interest is deducted, however, effective tax rates with debt finance can be negative. For equity assets taxed at an effective rate of 35%, the effective tax rate on debt-financed investment is a negative 5%. The rate on equipment without bonus depreciation is minus 19%; with bonus depreciation it is minus 37%.”  [CRS pdf]

Someone has to love the part wherein the capital improvements or investments are financed, the interest is deducted, and the effective tax rate can be a negative — what’s not to love? Except:

#1. The tax break was supposed to be a temporary stimulus for business expansion, with a temporary incentive for business spending.

#2. The way the current bill is drafted it’s going to cost the Federal government about $263 billion in lost revenue — from corporations, not the little guys.

#3. The CBPP informs us: ” Under current law, companies pay far less than the statutory 35 percent corporate tax rate on the profits flowing from those investments.  In some cases, they pay nothing and actually receive a tax subsidy.  Bonus depreciation only increases this favorable tax treatment.”

While the residents of Lyon County, Nevada are waiting for some business to expand and start hiring — the accountants at the corporate HQ of Soakem & Runn, Inc.  are tasked with finding yet more ways they can reduce their federal tax liability.  Therefore, the Lyon County residents must wait for the corporation to take its deductions, decide to use the money saved to expand the business, decide to locate the firm’s new improvements in the county, and take the plunge to build or expand operations.  Please do not hold your breath during this process.

Meanwhile, the extension of unemployment benefits, so disparaged by Representative Amodei have a far more immediate stimulative effect on the economy.

When we were discussing the extension of unemployment benefits back in 2011, the Congressional Budget Office estimated (pdf) that the cost of the extension would be approximately $44.1 billion during the first year. [Roosevelt Inst]  Yes, there is a cost, but the money circulates back into state and local economies.  The Congressional Budget Office estimated more recently that not extending unemployment benefits puts an approximate 0.2% “drag” on the overall economy. [CNN]  The percentage may not sound like much but when we consider that our gross national product is $17,268.7 billion [FRED] that isn’t chump change.

Instead of waiting for Soakem & Runn, Inc. to decide whether to use the new tax break for any expansion, and to determine what kind of expansion that will be, and if it will actually be in the county — Lyon County citizens might pin their hopes more realistically on the continued growth in the American GNP:

US GNP

With all due respect, they’ll have a shorter wait watching the GNP and GDP charts than they’ll have waiting for the corporations to decide how to apply their new tax breaks.  However, there’s more, as Representative Amodei tried to get more specific about Lyon County.

He referred to the need to pass the “Yerington Bill” which would create jobs and passed in the 112th Congress, but not in the present 113th.  Again, we’ll have to speculate that he meant the bill to assist the Pumpkin Hollow Mining operations, [PHM] one which has previously gotten itself mired in partisan politics, wherein an amendment was attached allowing Border Patrol agents to bypass environmental laws they deemed too restrictive.  [LVSun]

Representative Horsford (D-NV4) and Senator Heller (R-NV) are both supportive of the bill so it may have some future… but again the residents of Lyon County will have to wait.   It’s July 16th, and the House is only scheduled to be in session for nine more days until the month long August break, after which the House will have ten working days in September, another two in October, seven in November, and finally another eight working days in December. [House Cal. pdf]  That leaves a total of 36 legislative working days from now until the end of the year.  Again, Lyon County residents might want to just keep watching the GNP and GDP trends.

 

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Filed under Amodei, Congress, corporate taxes, Economy, Nevada economy, Nevada politics, Politics, tax revenue, Taxation

Another Day, Another Drill Baby Drill Bill

Oil RigAnother day, another bit of living proof Republicans don’t have a clue how world oil markets work…or if they do they don’t care, and they are perfectly pleased to do the bidding of multi-national oil corporations. Witness their shiny new bill: Lowering Gasoline Prices to Fuel an America That Works Act, or H.R. 4899, for which Rep. Mark Amodei (R-NV2) and Rep. Joe Heck (R-NV3) were pleased to vote, but which didn’t fool Rep. Steven Horsford (D-NV4) or Rep. Dina Titus (D-NV1). [rollcall 368]

The bill is a Christmas Wish List from the Oil Barons to the U.S. Congress, it’s Drill Baby Drill, and Shale Smacking Goodness — for the oil barons.

The bill’s authors assume the American public has a density equivalent to the API standard for heavy crude, i.e. an API gravity of less than 20°.

We’d have to be that dense in order to believe that more offshore drilling is going to have a perceptible impact on gasoline prices.  To demonstrate that we have an API gravity of at least light sweet crude, (37° to 42°) let’s review.

What factors determine oil prices?  There’s a picture for that —

Oil Price DiagramThere’s a supply side and a demand side, which in our good old capitalist system creates the prices.   On the supply side, crude oil comes from both OPEC and non-OPEC countries. The demand side is determined by consumption from countries that either are, or aren’t, members of the Organization of Economic Cooperation and Development, aka OECD. [EIA]  The blithe assumption on offer is that if the U.S. drills for more crude oil, and puts more crude oil on the market, the lower the price will be at the pump.  Not. So. Fast.

All those arrows point, not to your local refinery — much less your most convenient filling station — they point to the Spot Price.  The price of oil also depends on the demand for it, and there are two more charts to illustrate who’s demanding what.  First, let’s look at the non-OECD countries, like China, India, and Saudi Arabia:

Non OCEDWithout getting into too much gory detail, the blue columns represent demand from countries like China, India, and Saudi Arabia. The price and consumption trends tend to follow one another.  Now, let’s take a look at the other graph — the one illustrating the OECD countries, the United States and most of Europe.

OECD chartWhat do we learn from this illustration?   The EIA explains:

“The Organization of Economic Cooperation and Development (OECD) consists of the United States, much of Europe, and other advanced countries. At 53 percent of world oil consumption in 2010, these large economies consume more oil than the non-OECD countries, but have much lower oil consumption growth. Oil consumption in the OECD countries actually declined in the decade between 2000 and 2010, whereas non-OECD consumption rose 40 percent during the same period.”

Consumption is higher in developed countries — that’s just about obvious with our higher rate of vehicle ownership — but we have a lower rate of oil consumption growth.  While oil consumption rates were going down in the U.S. and Europe, non-OECD consumption rates were going up, up by 40% as the EIA reports.  Notice that the price and the consumption lines don’t track for OECD countries — that would be us — as they do for the non-OECD countries — that would be China, India, and Saudi Arabia.

Now, let’s return to that spot price.

“The spot price is the current market price at which an asset is bought or sold for immediate payment and delivery. It is differentiated from the forward price or the futures price, which are prices at which an asset can be bought or sold for delivery in the future.” [InvestAns]

The spot price is set in the ‘markets,’ i.e. the commodities market. For today’s prices Bloomberg News “Energy” page provides what the w-o-r-l-d price is for crude oil and refinery products.  Now we can approach the obvious question — who benefits from increased offshore drilling in U.S. waters?

A quick look at the two charts above should provide a major clue — it would be the areas with the highest consumption growth rate, i.e. the non-OECD countries — China, India, Saudi Arabia, etc.  Since oil is sold on the w-o-r-l-d market it will most likely go where there is the most demand.

Thus, what Representatives Heck and Amodei are supporting is the increase in offshore oil leases for multi-national oil corporations to sell the oil on the world market, in which it will probably go to those countries (non-OECD) like China, India, Brazil, etc. in which the consumption growth rate is higher.

To add insult to the injuries, the oil companies aren’t developing the leases they currently hold

“As of May 2012, nearly 72 percent of  the area on the Outer Continental Shelf (OCS) that companies have leased for oil and gas development – totaling 26 million acres – are not producing or not subject to pending or approved exploration or development plans. ” [Dept Interior, May 2012 pdf] [TP]

One might quibble with how the Department of the Interior categorized lands undergoing seismic and geophysical testing as not “active,” but the fact remains — about 2/3rds of the current leases aren’t producing.  The quibblers do make a legitimate point, not all leases will yield production.  Yet the thrust of the latest  Republican incarnation of Drill Baby Drill, as evidenced by the title of the bill itself, it that somehow more leases will automatically mean lower prices at the pump. Once more, glance back to the OECD chart and notice that the consumption and the price lines don’t match.

In the immortal words of oil-man President George W. Bush: “I know it’s in Texas, probably in Tennessee that says, ‘Fool me once, shame on … shame on you. Fool me… You can’t get fooled again!‘” [Time]

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Filed under Economy, energy, energy policy, Politics

Amodei and Heck Go Nuke

Nuclear missileHere’s what we get when things are reduced to “either/or” status in the deliberations of  the House of Representatives: Do we fund cleaning up toxic sites formerly used by the Department of Defense, or do we put the $3.4 million in Air Force research and development? There was a vote on an amendment to H.R. 4870:

“An amendment numbered 4 printed in the Congressional Record to increase funding for Environmental Restoration, Formerly Used Defense Sites, by $3,400,000 and reduce funds for Research, Development, Test and Evaluation, Air Force, by the same amount.”

The amendment was sponsored by Rep. Earl Blumenauer (D-OR), and it was defeated 179 to 24 [roll call 319] Nevada Representatives Titus (D-NV1) and Horsford (D-NV4) voted in favor of the amendment, Representatives Amodei (R-NV2) and Heck (R-NV3) voted against it.

In the grand scheme of federal budgeting a $3.4 million allocation isn’t all that much, but this issue does illustrate a problem for the Department of Defense, as specified in GAO reporting.

 “DOD is obligated to ensure that former defense sites are cleaned up to a level that is protective of human health and the environment. DOD has identified over 4,000 formerly used defense sites, which were closed before October 2006, and over 5,000 sites identified by several Base Realignment and Closure commissions that require cleanup.”

The Department implemented the GAO recommendations, and provides an annual report on its environmental clean up and restoration programs.  As with all things military there is an acronym for former sites, FUDS (formerly used Defense sites), and IRP (installation restoration program) and these are useful terms when reviewing the funding for these operations.

Funding for FUDS was $277.2 million in FY 2013, $287.4 million in FY 2014, and is projected to drop to $208.4 in FY 2014.  These funds would be allocated toward the restoration of 3.022 FUDS properties, and 8331 BRAC properties. [DENIX pp]  The system and the evaluation matrix are in place to implement the clean up and restoration projects.  However, only the Department of Defense could craft the following sentence explaining its goal:

Achieve RC at 90% of IRP sites, MRSs, and BD/DR sites at Active and BRAC installations, and IRP and BD/DR sites at FUDS properties, by the end of FY2018.” *Translation: RC = response complete; IRP = installation restoration program;  MRS = munition response sites; BD/DR = building demolition, debris removal; FUDS = formerly used defense sites.  BRAC = base realignment and closure.

The Department of Defense estimates that it is currently on target to meet this objective at a rate of 79%. Its projected rate is 92%.  The current FUDS rate is 78%, projected to 90%, and the BRAC rate is currently 83%, projected to 90%.  [DENIX pp]  In short, given the level of funding available, the Department of Defense is close to achieving its goal regarding the completion of restoration programs but doesn’t project a 100% “RC” in time for FY 2018.

There are two issues here, large and small.  Taking the smaller chunk first, the Department of Defense is close to meeting its targets for restoration projects, and appears at the ‘every little bit helps’ stage; meaning that the $3.4 million allocation could materially assist the Department in meeting its objectives.

By contrast, the comptroller of the Defense Department reports that the total allocated for Air Force research, development, evaluation, and testing appropriated for FY 2014 is $23,580,637,000 and the base figure for the same category in FY 2015 is $23,739,892,000. [ComptDoD pdf]  A bit of play with the plastic brains yields the information that the Blumenauer’s amendment would cost the Air Force research, development, testing and evaluation some 0.000143 of its budget.

At the heart of the floor debate, such as it was, is ‘seed’ money for a new cruise missile described by Representative Blumenauer as follows, ” The new ALCM does not yet have an official pricetag, but the research we have done suggests it is in the range of 20 to $30 billion. And a rebuilt nuclear warhead to go on it would cost another $12 billion, according to the National Nuclear Security Administration.” [ConRec]

Representative Freylinghusen responded:

“This program will provide a new air-launched cruise missile to replace a rapidly aging AGM-86. This is essential to our strategic deterrent and our ability to hold enemy targets at risk from standoff distances.

The Air Force requested $4.9 million for the program in fiscal year 2015 to continue studies and analysis in preparation for a formal acquisition program. This bill already takes a fiscally responsible $1.5 million cut from that amount.” [ConRec]

What have we learned?  That the new ALCM hasn’t gotten far enough off the drawing table to have a projected cost for the weapon.  We can estimate that the project will have the $800 million (or more) price tag discussed back in 2010. [GSN] We also know that the ALCM is a nuclear weapon, but the Pentagon hadn’t decided just what warhead would be fitted to the weapon. [GSN]

At this point the issue raised in a vote on a small amendment to a very large Defense appropriations bill takes on more meaning.

Two of Nevada’s representatives to Congress voted to provide the seed funds for the construction of a new nuclear weapon, one the Air Force considers essential to its “nuclear capacity,” and two did not.  There are some questions which were not raised during the brief discussion of the Blumenauer amendment on the House floor —

What is being said about Congressional priorities if funding for a new nuclear weapon is more essential than cleaning up and restoring formerly used military and defense installation sites?

If the new weapon is essential to the nuclear capacity of the USAF, then under what conditions and circumstances will it be used?  Or to put it rather more bluntly — whom do we intend to nuke and when? Perhaps, the two members of the Nevada congressional delegation who voted against the amendment would care to explain?

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Filed under Amodei, Defense Department, Defense spending, Heck, Politics

Post Scripts and Other Matters

PS post script** Oh, by the way, there’s another problem with House Speaker John Boehner’s commentary on “no new regulations” highlighted by the Examiner:

“In the last 5 years that Obama has been President, Republicans in Congress have done all that they could to loosen regulations for hazardous waste, and to make it harder for the EPA to protect our nation’s water and air. Republicans have even gone as far as calling for the abolishment of the EPA.”  More here.

** Benghaziiiiiiiii — Nevada Progressive reports that Representative Joe Heck (R-NV3) is going to head up a House committee to investigate…. wait for it…. Benghazi.  All I can add is that a person hoping to maintain some sanity should click over to Sound Cloud and click on Rocky Mountain Mike’s Right Wing Troll Notification System audio.

Should the latest Benghazi “investigation” not wish to re-invent the wheel, or the use of fingers to get food from fire to mouth for that matter, there are some excellent sources of information.  There’s the State Department’s Accountability Review Board report (pdf) and there’s David Fitzpatrick’s excellent reportage for the New York Times (December 28, 2013.   If that’s not enough for you, there’s the 85 page report from the Senate Select Committee on Intelligence (pdf) issued on January 15, 2014.

But then, nothing will ever be enough to satisfy the anti-Secretary Clinton crowd, and generally befuddled Faux News viewers, who cling to their conspiracy theories and react vehemently  to every new report debunking their fantasies.  Replay the “Right Wing Troll Notification System,” then read Bob Cesca’s “13 Benghazis that Occurred Bush’s Watch Without A Peep From Fox News.” [HuffPo]

** On a more serious note, see the NVRDC’s post on the Mythical Budget Deficit.   And, you know I’m going to quote a piece that includes my favorite economic concept for 2008-2014 — “aggregate demand:”

“The government should not be running a fiscal surplus when aggregate demand is still lagging in the macro economy. The country’s infrastructure is falling apart and we should be fixing it right now because the money is there and isn’t being used to expand employment or investment in the private sector. Instead coporate balance sheets are hoarding cash and using it to pay special dividends and stock buybacks for the investor class. That money should be put to work investing in America!” (emphasis added)

Combine this reading with Dan Crawford’s post on Angry Bear, “Time to end redistribution upwards…” (January 16, 2014)

** The campaign to elect Niger Innis to the Congressional seat held by Representative Steven Horsford (D-NV4) [Ralston] [Sebelius] seems to have gotten off to a rough start, with an FEC complaint [Ralston] from another candidate, “concerned citizen, ” whatever…

** We’re Number 2 — in the nationwide rate for residential foreclosures. Florida is still number 1. [RGJ]

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Filed under Economy, Politics, Republicans

Almost Hell, West Virginia, and Amodei Helped?

water pollutionMeanwhile back in West Virginia.

The D.C. media continued to demonstrate its disconnection from issues concerning Americans in the portion of the country located outside Interstate Highway 495 when its Sunday morning chatterati confabs assiduously avoided any discussion of the chemical spill into the Elk River in West Virginia.  There was plenty of information worthy of a few moments, but none deemed worthy of broadcast time which might otherwise be devoted to interminable speculation on the political ramifications of speculated political implications of endless political assumptions.  Meanwhile back in West Virginia.

There’s a lesson here about government regulations.  Those “burdensome” government regulation which are “stifling employment,” and “hurting the economy,” to hear the Republicans tell it.

“The spill of 4-Methylcyclohexane Methanol, or Crude MCHM, a chemical used in the coal industry, occurred on Thursday on the Elk River in Charleston, West Virginia’s capital and largest city, upriver from the plant run by West Virginia American Water.”  [YahooNews] (January 10, 2014)

The good news is that the stuff  isn’t highly lethal.  The bad news is that the preliminary reports don’t tell us exactly how much of the the stuff  was accidentally spilled into the river, the current estimate is 5,000 gallons.  Those 5,000 gallons flowed into the water supply in nine West Virginia counties.  Charleston, WV’s 51,000 residents are still struggling.

Additionally, the incident gives us a glimpse of why environment regulations aren’t the “burdensome,” “hurtful,” “job killing” spikes in our national economic life.

(1) At some point the newspapers will report the cost of this spill.  The cost of closed schools, closed restaurants, closed businesses, business revenue lost, earnings and wages lost.  Events postponed, events cancelled.

“Downtown Charleston is dead,” Mayor Danny Jones said in an interview. “It’s not just my city, it’s nine counties. When you don’t have water you can drink or bathe in, you’re pretty much frozen solid.”

(Charleston Mayor) “Jones said hotels, restaurants and affiliated businesses were closed in the city of 51,000 people, which swells to about 125,000 on an average workday. A convention of mayors and city council members from around the state, scheduled to begin Sunday, has been canceled, he said.”  [WaPo]

Common sense dictates that the economic costs of this chemical spill is going to be well beyond, far beyond, the cost of enforcing environmental regulations.

(2) Why do we have all these “burdensome” regulations when such accidents are rare events?   That’s the point, the entire exercise is undertaken to insure that accidents are rare events.  Yes, these events are rare, but when accidents do happen they are exceedingly expensive and harmful.  Witness some recent examples:

In December 2008, the retaining wall on a coal ash pond failed, sending 1.7 million cubic yards of toxic coal ash slurry into the Emory River, and an adjacent residential area in Tennessee. (Later estimates were raised to 5 million cubic yards)  The April 20, 2011 BP Deepwater Oil Spill poured more oil into the water than any other accident in U.S. history, and 11 workers lost their lives. The final effects of the destruction of the Fukushima Nuclear Power (March 2011) plant are still being tallied.

In August 2012 the Tennessee Valley Authority, owner of the Kingston facility, was judged liable for the damage caused by its coal ash spill.  It had already spent $43 million to buy contaminated properties.  The TVA’s litigation moved into new territory as plaintiffs were allowed to bring their individual cases to court.  [Reuters/HuffPo]

The Deepwater Horizon incident cost BP $25 billion, not counting fines levied by the government as of July 2013.  The corporation owes another $4.5 billion in fines. BP has set aside approximately $42 billion in estimated final costs.  [PBS]

A insurance trade group associated with the West, Texas fertilizer plant that exploded in April 2013, estimated the cost of the 90 foot wide crater and adjacent damage at approximately $100 million. [AP/HuffPo]

Meanwhile back in West Virginia.

(3) An ounce of prevention is worth a pound of cure.   There doesn’t seem to have been enough attention paid to preventing the contamination of the Elk River.

“Asked late last week how much planning county officials had done for a possible leak from Freedom Industries into the region’s water supply, Kanawha County Commission President Kent Carper was blunt.

“Not enough,” Carper said. But Carper also pointed the finger at the water company, saying West Virginia American certainly knew Freedom Industries was there and should have prepared for an accident like this one.” [WVGM]

If Kanawha County wasn’t as prepared as it should have been, how about federal inspections and enforcement?

OSHA began an inspection in November, 2009, resulting from industrial accident and injury reports, but found that the firm was misclassified for the inspection program implemented and the inspection never took place.  [WVGM]

What of state Department of Environmental Protection?   Because Freedom Industries was categorized as a storage (as opposed to a manufacturing facility) and because it created no emissions — it wasn’t on their radar.  [WVGM]

At some point the U.S. Attorney will complete his investigation of the contaminant spill, and West Virginia American and its subsidiary Freedom Industries will discover what TEPCO, the TVA, BP and others have already known — it’s less expensive to create the safest possible industrial operations plan than it is to pay for the damages later.

It’s easy to be glib about industrial accidents, and contaminating chemical spills, and generalize about how statistically “safe” our energy and chemical sectors are.  It’s easy to generalize about “burdensome” regulations, but much more difficult to explain away destroyed homes, lost revenue, undrinkable water, and economic damage when specific incidents highlight how important those regulations actually are.

The question we should be asking is NOT how to reduce regulations related to the use, storage, and safety of our chemical and energy operations, but how we can strengthen those regulations to prevent as many such accidents as possible.   However, that’s precisely what the House did.

“As West Virginians were learning Thursday of a devastating chemical spill in the Elk River that has rendered water undrinkable for 300,000 people, the US House of Representatives was busy gutting federal hazardous-waste cleanup law.

The House passed the Reducing Excessive Deadline Obligations Act that would ultimately eliminate requirements for the Environmental Protection Agency to review and update hazardous-waste disposal regulations in a timely manner, and make it more difficult for the government to compel companies that deal with toxic substances to carry proper insurance for cleanups, pushing the cost on to taxpayers.”  [RT] (emphasis added)

The Reducing Excessive Deadline Obligations Act passed 225-188, on January 9, 2014.  [roll call 10]  Representative Mark Amodei (R-NV2) voted in favor of the bill, Representatives Dina Titus (D-NV1) and Steven Horsford (D-NV4) voted against it. Representative Joe Heck (R-NV3) is recorded as not voting.   Representative Amodei may wish to explain, why, when his fellow Americans in West Virginia were struggling to find potable water, he voted to prevent the government from requiring that corporations carry enough insurance to cover the cost of their accidents.  And, why tax paying citizens in Nevada should be forced to pick up part of that tab?

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Another Serving of Loopy: Nevada GOP fires off the Big Birther

Fruit LoopsAnd just when we thought…maybe, perhaps, just possibly…the Clark County GOP might be functioning in the real world: They fire off a Big Birther.  [Ralston]

Step right up and get your invite to a Las Vegas Event for District 4 candidate Tea Party activist Niger Innis, complete with Nevada’s very own Big Birther.  That would be Wayne Allyn Root, self styled Capitalist Evangelist.  We are to know he is an expert because:

“Wayne’s columns and commentaries are read by millions at popular conservative web sites such as FoxNews.com, TheBlaze.com, TownHall.com, HumanEvents.com, DailyCaller.com, and PersonalLiberty.com. He has made over 5000 media appearances in the past 5 years.”

However, 5000 media appearances on these “popular” (as opposed to accurate and informative) sites hasn’t rendered our Capitalist Evangelist immune from April Fools Day jokes.

“Hannity’s guest was Wayne Allyn Root, who was on to promote his assertion — which he has been peddling since at least 2008 — that he never met Obama when they were students at Columbia and that no one Root knew “at Columbia ever met him, ever heard of him, or ever saw him.” FactCheck.org has pointed out that it’s “absolutely untrue” that nobody has stepped forward to claim they knew Obama as a college student.

After making the Trump-esque claim that Obama has spent “millions of dollars” to keep his records sealed, Root went on to demand that Obama release his college transcripts, then speculated that the reason he hasn’t done so is because he was enrolled as a “foreign exchange student.” That claim has its origins in a fake news article sent around as an April Fools’ joke.” [MMFA]

At the risk of eliminating my chances for being a Capitalist Evangelist, if I counted every blog post I’ve ever slapped up on the Internet then I have nearly as many ‘media appearances’ as the Big Birther, and worse still there must be thousands of former Mizzou students I never met during my time there.   However, the institution did manage to endow me with sufficient reserve to avoid passing along e-mailed April Fools jokes as Revealed Truth.

Mr. Capitalist Evangelist gave us a sample of his philosophy (ideology) in April 2011:

“It’s official. President Obama has declared war on capitalism, which is funny because he never officially declared war on Libya. But our fearless Marxist-in-chief reserves a special brand of hatred for capitalism, entrepreneurship and rich people. Just days ago, Mr. Obama publicly blamed “speculators” for the rising price of gas.”

We might begin with the obvious problem with the analogy —  the President never officially declared war on Libya and one doesn’t officially declare war on a social/economic system.  However, it doesn’t take a “special brand of hatred” to understand that the creation of Commodity Index Funds tends to facilitate speculation in the oil market.  Whether that facilitation is a factor in the setting of actual prices is still a matter of academic debate [Econobrowser] while we attempt to look for the mixture of “hedgers and speculators” in the commodity index markets. [agmrc]

A year earlier, in 2010 Mr. Root was enjoying his limelight with his evangelism:

“On the April 15 Fox & Friends, former Libertarian Party vice presidential nominee Wayne Allyn Root said: “It’s not greedy to want to keep more of your own money. It’s greedy to ask government and the IRS at gunpoint and the threat of prison to steal it from others who earn it and redistribute it to those who don’t. That’s the definition of greed.” He later stated: “I am diametrically opposed to my old college classmate Barack Obama, who seems to think you take it from the people that work all day to earn it, and you redistribute it to those who couldn’t care less, sit on the couch, and watch Oprah all day. That’s not my crowd.”

True to his Ayn Randian Ideology, Root adopts the “Takers + Welfare Queens + Redistributionist” line from the radical right.   Apparently someone forgot to inform Mr. Root that the musings of Ms. Rand are  Fiction.

It may be more galling to the radical right wing supporters of Mr. Root and his cohort that the American people aren’t concerned enough about the Government’s (read Democratic administration) to see Revealed Truth.  Surely, the President must be illegitimate.  His birth, his college records, his philosophy “must be” questionable.  Therefore, the results of his elections in 2008 and 2012 “must be” seen as a product of duplicity, fraud, and a alarmingly unenlightened electorate.

So, in the happy environs of a Nevada GOP event a potential candidate for District 4, the Tea Party activist will be paired, — like a nice Chardonnay with a salmon avocado salad — with the Capitalist Evangelist who has called for the repeal of Section 1 of the 14th Amendment [ALPAC], 100% border security before any “path to citizenship,” [ALPAC], and the dissolution of Department of Education SWAT teams. [Blaze]   This latter cause celebré came from a September 18, 2012 Department of Justice action on defrauding the Federal Student Assistance program:

“According to the indictment, from July 2007 to June 2011, the defendants conspired with each other and with others to obtain federal student assistance funds by fraud. Michelle Wright and Mendoza used stolen personal identity information to apply for additional  FSA funds. Some of these individuals were severely handicapped and unable to read or write, let alone attend college.  The defendants recruited straw students and used their own names to apply for FSA funds. Michelle Wright and Mendoza completed the paperwork necessary to obtain the funds. As a result of their scheme, the Department of Education lost more than $285,000.” U.S. v. Michelle Wright et al. (2:12-cr-316-WBS) [DoJ]

That Kenneth Wright was rousted in this action may be mistaken and unfortunate, but being related to a person accused of this kind of  identity theft and $285,000 worth of fraud will definitely draw attention from law enforcement personnel. No, the raid wasn’t related to defaulted student loans, it was about good old fashioned fraud. And, no, the Department of Education doesn’t have its very own SWAT team — local law enforcement personnel carried out the raid.  [WaPo]

If Nevadans in District 4 were hoping for a moderate candidate emanating from the Republican side of the contest, they may very well be profoundly disappointed.  If anyone in the Silver State hoped the Republicans would take the admonishments of the post 2012 election debacle re-branding to heart — it hasn’t happened yet.

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The Economics of Comprehensive Immigration Policy Reform

TitusIf the Republicans could cease hyperventilation over the ACA rollout, and the media could find time to address problems associated with more than 3-5% of the American population — then we might want to consider Comprehensive Immigration Reform.   Two Nevada Representatives seem to be on target.  Representative Dina Titus (D-NV1) expressed her opinion on the subject:

“Now is the time for the House to take up the mantle of reform and make it law,” Titus said. “Comprehensive reform is a moral imperative and an economic necessity that we must get done so the 11 million people who live, work, and raise their families in our country, including over 190,000 people right here in Nevada, can finally come out of the shadows and pursue their American Dream.”

Aside from the moral imperative — Representative Titus is correct: Reform is an economic necessity.  Consider the following numbers.  If we enact comprehensive immigration policy reform we can reasonably expect to add $1.5 trillion (yes, that’s Trillion) to our GDP over the next decade.  If we adopt the deportation only option we can reasonably expect to lose $2.6 trillion.  [CAPcip pdf] Now, which would we prefer? Another $1.5 trillion added to the GDP or the loss of $2.6 trillion in economic activity.

Representative Stephen Horsford (D-NV4) expressed his frustration with the machinations of the House as prospects for the passage of H.R. 15 fade:

“It only takes 15 minutes to pass a bill once they decide to bring it for a vote,” he said. “There is bipartisan support for many bills, but right now we have a Speaker who is choosing to only govern based on what a faction of his caucus supports, rather than a majority of the body.” [NP via Hill]

Evidently, Tea Party squeamishness over immigration trumps economic necessity.   House leadership seems to have more excuses for inaction on the subject than a junior high student propounding rationalizations for unfinished homework.

For Speaker Boehner the immigration policy is essentially stall ball, chopping the issues into component parts, passing some leaving others to wither on the vine, and generally leaving us with another patchwork policy insufficient to improve our economy:

Despite saying last month that House lawmakers need to address some form of immigration reform, Speaker John Boehner (R-OH) told reporters Wednesday that taking up a Senate-passed bill that includes a path to citizenship was a non-starter.  Boehner announced his Slice and Dice strategy:

“We have no intention of ever going to conference on the Senate bill,” Boehner said at a weekly briefing in Washington.  Instead, the speaker voiced his preference for a “step-by-step,” “common sense” solution to address the nation’s broken immigration system.”

Precisely why piecemeal is “common sense” is left in a gulf of widely varying interpretations.

House Majority leader Eric Cantor’s (R-VA) excuse is a classic instance of Pretzel Logic ratiocination.  Witness this exchange between Congressman Cantor and Representative Hoyer (D-MD) on the subject:

“HOYER: Bring it to the floor and see if the House thinks it’s a bad bill. See if the House believes that it’s a bill that is not worthy to be considered and passed as a fixing of a broken immigration system … He has the power to bring that bill to the floor.

CANTOR: We don’t want a repeat of what’s going on now with Obamacare. That bill, constructed as it is by the Senate, last-minute-ditch effort to get it across the finish line … let’s be mindful, Madam Speaker, of what happens when you put together a bill like Obamacare and the real consequences to millions of Americans right now, scared that they’re not going to even have health care insurance that they have today come January 1. […]” [TP]

In other words, by Cantor’s lights we can’t have comprehensive immigration reform because there are glitches in the implementation of the Affordable Care Act.  Really?  First, the glitches are in only one segment of the ACA (enrollment of individual who presently have non-compliant individual policies), and secondly the notion that one House of Congress shouldn’t work with its counterpart because a previous bill had burps and hiccups is patently  ridiculous.   This is, essentially, an argument for doing absolutely nothing about anything at anytime.

Meanwhile back in Reality Land.  Enacting comprehensive immigration policy reform would help bring down that deficit the GOP constantly frets about: “The higher earning power of newly legalized workers would mean increased tax revenues of $4.5 billion to $5.4 billion in the first three years.”  [CAPcip pdf]

Remember all that talk about Aggregate Demand in these posts?  There’s a benefit from comprehensive immigration policy reform there as well: “Higher personal income would also generate increased consumer spending—enough to support 750,000 to 900,000 jobs in the United States.”  [CAPcip pdf]  If the Speaker wants to apply common sense to the issue try this — (1) lower and middle income earners SPEND more.

“As in previous time periods, the lowest income quintile allocated larger shares to food and housing than the other quintiles. The  highest income group allocated a larger share to personal insurance and pensions (including payments for life insurance, other nonhealth insurance, pensions, and Social Security) than any other group.” [BLS 2013]

Who is more likely to spend income on food, housing, apparel, etc. thus creating jobs? Lower and middle income wage earners.  This leads us to (2) More spending creates more Demand.  And, obviously (3) more Demand creates more jobs because of the First Law of Human Resources — There is NO rational incentive to hire anyone to do anything unless the current staffing levels are inadequate to meet customer demands for goods and services.

For more “common sense” economic results from enacting comprehensive immigration reform see “The Economic Benefits of Comprehensive Immigration Reform,”  American Immigration Council January 14, 2010 [pdf]

190,000 people in the state of Nevada could be making a greater contribution to our economy, and if the moral imperative cited by Representative Titus isn’t enough incentive for passing a CIR bill, then at least we ought to give serious consideration to acting in our own best interests.  For every petty political reason for ignoring the immigration policy issue (perhaps in hopes it will quietly go away) there are 1.5 Trillion reason$  for enacting a comprehensive solution.

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