Market Speculators Driving Up Gas, Food CostsJune 19, 2008 21:40 Oil prices Wednesday jumped to near $137 per barrel Wednesday as speculators reacted to news that U.S. crude inventories have declined and of a possible strike in Nigeria, a key supplier of crude oil to the U.S.
But it's that kind of speculation that has caused key commodities, such as oil and food, to skyrocket to record highs this year that has Sen. Ben Nelson, D-Neb., concerned.
Commodity markets Wednesday had corn futures at $7.80 per bushel; soybeans, $15.58 per bushel; and wheat, $9 per bushel.
As food costs escalate, a number of countries facing a food crisis is growing, leading terrorism and security experts to predict widespread social and political unrest and violent conflict worldwide.
Last week the United Nations' World Food Program announced it is to provide $1.2 billion in additional food aid to the 62 countries hit hardest by the food and fuel crisis.
Nationwide, the AAA reported the average price of regular gasoline remains at more than $4 per gallon. In Nebraska, AAA reported gas prices averaged $3.95 per gallon on Wednesday.
Nelson said he recently attended a joint meeting of the Senate's Financial Services Committee and the Senate Agriculture Committee (of which Nelson is a member) on the resource needs of the Commodity Futures Trading Commission (CFTC).
Congress created the Commodity Futures Trading Commission (CFTC) in 1974 as an independent agency to regulate commodity futures and option markets in the United States.
Nelson said CFTC officials told senators that they're taking better oversight for commodities markets, particularly with foreign exchanges that trade U.S. oil.
But Nelson said he has his doubts.
Ross Perot Wants More Focus On National DebtJune 19, 2008 18:21 Ross Perot is jumping back into the political fray, this time with a stern warning that the country better start paying attention to the national debt.
The former presidential candidate has reemerged with a Web site spotlighting the soaring budget deficit: more than $9.3 trillion and growing.
"We live in the greatest country in the history of man. We've been so successful for so long that we now take our success for granted," Perot says in a video posted on PerotCharts.com.
"Not since the Great Depression have we seen an economic crisis of the magnitude that we are facing today," he says.
He says the purpose of the site, which is not affiliated with any political party, is "to provide accurate information to every citizen about the serious economic problems facing our country."
True to his style, he uses charts to detail the rise in government spending, the federal budget and the growing national debt, among other things.
Americans Drive 1.4 Billion Fewer Highway MilesJune 18, 2008 23:07 Americans drove 1.4 billion fewer highway miles in April than they did in April 2007, the Department of Transportation said Wednesday.
That marks the sixth consecutive monthly drop and coincides with record gas prices and an increase in transit ridership, Transportation Secretary Mary Peters said.
April's drop is more than three times larger than the drop from March 2007 to March of this year, which was 400 million fewer highway miles.
Peters said vehicle miles traveled on all public roads for April fell 1.8 percent from April 2007.
Americans have driven nearly 20 billion fewer miles overall this year and nearly 30 billion fewer miles since November, the department said.
Peters expressed concern that the cutbacks have resulted in the collection of fewer taxes on gasoline. Such taxes are funneled to the federal Highway Trust Fund, which gets 18.4 cents per gallon from gasoline and 24.4 cents per gallon from diesel fuel.
"History shows that we're going to continue to see congested roads while gas tax revenues decline even further," she said.
Bush Calls For End To Offshore Oil Drilling BanJune 17, 2008 21:55 President Bush, reversing a longstanding position, will call on Congress on Wednesday to end a federal ban on offshore oil drilling.
According to White House officials, Bush now wants to work with states to determine where drilling should occur.
The move underscores how $4-a-gallon gas has become a major issue in the 2008 presidential campaign, and it comes as a growing number of Republicans are lining up in opposition to the federal ban.
The party’s presumptive presidential nominee, Sen. John McCain of Arizona, used a speech in Houston on Tuesday to say he now favors offshore drilling, an announcement that infuriated environmentalists who have long viewed him as an ally. Florida’s governor, Charlie Crist, a Republican, immediately joined McCain, saying he, too, now wants an end to the ban.
The issue caused a heated back-and-forth on the presidential campaign trail on Tuesday, as McCain sought to straddle the divide between environmentalists and the energy industry — while facing accusations from his Democratic opponent, Sen. Barack Obama — that he had flip-flopped and capitulated to the oil industry.
In Washington, the White House press secretary, Dana Perino, said Bush would urge Congress to “pass legislation lifting the congressional ban on safe, environmentally friendly offshore oil drilling,” adding, “The president believes Congress shouldn’t waste any more time.”
Bush has long advocated opening up the Arctic National Wildlife Refuge in Alaska to drilling, and has said in general that he favors more domestic oil exploration. But the topic of offshore drilling has been an extremely sensitive one within the Bush family; Bush’s father, the first President Bush, signed an executive order in 1990 banning coastal oil exploration, and Bush’s brother Jeb was an outspoken opponent of offshore drilling when he was governor of Florida.
Fema Director Defends Giving Away Hurricane SuppliesJune 15, 2008 20:45 The director of Federal Emergency Management Agency on Sunday defended giving away an estimated $85 million in hurricane relief supplies, blaming Louisiana officials for turning down the stockpiles.
"We still have quite a few left if Louisiana needs those," David Paulison said. "But we did find out, we did ask Louisiana, 'Do you want these?' They said, 'No, we don't need them.' So we offered them to the other states."
A CNN investigation revealed last week that FEMA gave away 121 truckloads of material the agency amassed after 2005's Hurricane Katrina. The material was declared surplus property and offered to federal and state agencies -- including Louisiana, where groups working to resettle hurricane victims say the supplies are still needed.
Fed Projects Mass. ForeclosuresJune 12, 2008 16:55 A new report from the Federal Reserve Bank of Boston projects that Massachusetts foreclosures will peak no earlier than the second quarter of 2009, and perhaps not until the second quarter of 2010. The complete projections are after the jump.
The report, available here, makes the basic point that foreclosures almost always happen when a homeowner's mortgage debt exceeds the value of the home, but that only a small share of people in that situation end up in foreclosure. In other words, owing more than the value of your home is a necessary but not a sufficient condition to precipitate a foreclosure.
Most people continue to make their mortgage payments. The most obvious explanation is that they believe the value of the home will recover. The researchers also note that homeowners act as both investors and occupants. Even if a home remains a bad investment, it may be cheaper to stay and pay "rent" than to buy or rent a comparable home. In the extreme case, a person might remain in a home that has lost all of its value because their monthly mortgage payment is cheaper than any alternative.
Don'T Look For Relief From High Prices Any Time Soon.June 12, 2008 16:43 For those struggling to deal with record gasoline and soaring food prices, there's bad news and more bad news.
Economists think inflation is here to stay. And it's likely to get worse.
A weak dollar and growing economies in emerging markets have conspired to send commodity prices higher. Those factors are unlikely to change anytime soon.
"We're more open to influences from the rest of the world than we were before," said Jay Bryson, international economist with Wachovia. "That does make it more challenging to keep inflation under control."
What's more, the Federal Reserve is relatively powerless to deal with many of these pressures.
"The Fed can't control prices of commodities determined in a global market," said Rich Yamarone, director of economic research at Argus Research. "If it could, it would have done so already."
On Friday, the Labor Department will report its latest reading on inflation. According to estimates from Briefing.com, economists expect that the Consumer Price Index (CPI) rose 0.5% in May. That would be the biggest jump in a year. It also would likely mean that prices would be up more than 4% on a year-over-year basis.
House To Vote On Extending Unemployment InsuranceJune 12, 2008 10:53 In the face of a veto threat, House Democrats are urging their colleagues Thursday to pass an extension of unemployment insurance benefits, a tool they hope will ease at least part of the financial stresses burdening U.S. families.
Several million unemployed workers could be helped by the program, according to the Congressional Budget Office. The legislation would provide up to 13 weeks of extended unemployment benefits to workers exhausting the regular program, which typically lasts 26 weeks. In states suffering from higher levels of unemployment, an additional 13 weeks would be available.
The administration has threatened to veto the bill, saying that the unemployment rate is too low to justify a national federal extension of the benefits. The White House opposes eligibility for workers in all states to receive extended benefits, and said it could support a bill that offers a 13-week extension of unemployment benefits only to states with higher unemployment.
Advocates of a national extension point out that lawmakers have historically been tardy in reacting to economic downturns.
"In past recessions, the Congress and the administration typically were late to recognize the need for such an extension or wrangled over the need for such action as labor-market conditions worsened," the Center on Budget and Policy Priorities said. "Prompter action would have provided worthwhile economic stimulus when it was most needed and relief to workers looking for a job in a worsening labor market."
The Labor Department reported Thursday that first-time filings for unemployment benefits spiked upward in the latest week, hitting the highest level since late March, as the number of continuing jobless claims reached the highest level since early 2004.
Specter Says Bush Administration Is Hindering Quick Fda FundingJune 12, 2008 09:27 Sen. Arlen Specter said the Bush administration is "drastically hindering" the Food and Drug Administration's ability to quickly get an important boost in funding.
In a letter sent Tuesday to Health and Human Services Secretary Michael Leavitt, Sen. Specter said the FDA's request on Monday for an additional $275 million wouldn't give them any money until March or April 2009 "at the earliest."
In a handwritten note on the letter, the Pennsylvania Republican said the "Administration is drastically hindering necessary immediate relief by delaying the funding for eight or nine months." He added, "FDA needs this money now to save lives."
A spokeswoman for Sen. Specter confirmed that he is referring to the Bush administration in the hand-written portion of the letter.
Sen. Specter has been working to get the agency $275 million in the fiscal 2008 supplemental appropriations bill. He said the FDA's request "undermines" the Senate's efforts to get the agency funds on an "expedited basis."
Sen. Specter acknowledged Congress is considering eliminating the FDA funding from the supplemental appropriations bill. If the bill was signed with the FDA funding intact, the FDA would have to receive the money by Sept. 30, the end of the fiscal year.
On Monday, while under pressure from recent recalls of imported drugs and other products, the FDA formally requested $275 million from Congress to pay for more inspections.
US House Republicans Block Longer Jobless Benefits | Markets | Bonds News | ReutersJune 11, 2008 17:14 Republicans in the U.S. House of Representatives on Wednesday blocked an effort by Democrats to quickly pass an extension of jobless benefits for the long-term unemployed.
Even though a large majority of the House, 279-144, voted for the measure, it fell three votes short of the two-thirds vote needed under special rules for passing the bill, which would have extended jobless benefits for those who exhaust the usual 26 weeks of state benefits.
House Majority Leader Steny Hoyer, a Maryland Democrat, said the bill will be brought back to the floor on Thursday under rules requiring only a simple majority for passage. If it does pass, the Senate would then consider it.
The vote came just days after the government reported that the U.S. unemployment rate jumped to 5.5 percent in May, its highest level in more than 3-1/2 years.
About four dozen Republicans broke ranks with President George W. Bush and supported the measure amid deepening election-year concerns about the stagnant U.S. economy.
The White House issued a veto warning shortly before the House vote, saying it would instead support an extension of benefits targeted to states with the worst unemployment.
Blame Rising Oil Prices On BushJune 10, 2008 22:51 Wow, a lot of people must have bought Hummers last week. How else to explain the spike in oil prices? No, I'm not being silly - they are. And by "they," I mean the gaggle of media pundits and other administration apologists abetted by some green zealots who want to explain our energy crisis by reference to profligate consumers.
Sure, in the long run, we consumers, particularly the most wasteful ones who happen to reside in the good old USA and who have become accustomed to consuming many times our population's worth of the world's resources, do need to shape up. But that has little to do with the fivefold rise in the price of oil since George W. Bush became our president. Yep, he did it; Bush's deliberate roiling of world politics is the key variable in the run-up of oil prices. No president has been more brilliant in destabilizing the politics of oil-producing countries from Venezuela to Russia, as well as those of the key oil lakes of Iraq and Iran.
This last will go down in our nation's history as one of the dumbest escapades of all time, rivaling even the madness of the Vietnam War. Vietnam was always absurd on its face as an imperial adventure because, as American consumers who check their labels must know, the Vietnamese dominate the market only in the provision of farmed shrimp.
I won't bother here to dignify the canard that Vietnam, anymore than Iraq, ever represented a serious threat to U.S. security, Sen. John McCain's sacrifice in the former war and his apologetics for the current one not withstanding. After the most ignominious defeat in American history, Communist Vietnam did not have to be fought on the shores of San Diego, as the hawks at that time predicted, but rather it went to war with Communist China, the country that had occupied that nation for a thousand years. The Vietnamese later made their peace and now compete successfully in the capitalist marketplace without controlling anyone else's resources.
Something similarly unexpected will likely occur if we get out of Iraq and permit the people of that region to make their own history. Events upon our departure will follow the vagaries of an historical script centering on religion, ethnicity and nationalism, which the talking heads in media and political circles are united in ignoring. As Iraqi Prime Minister Nouri al-Maliki demonstrated the other day with his third visit to his former safe haven in Iran, the politics of the region have already been sorted out in ways unpredicted by the neoconservatives.
On Energy Policy, Is Better Than Bush Enough?June 10, 2008 17:01 LAST WEEK, the Senate considered a bipartisan global warming bill - the closest such a far-reaching measure has ever come to passage. Although the bill failed in the end, over half of the Senate supported action on climate change.
The next Congress and administration will have a historic opportunity to build on this momentum and deliver the American people a comprehensive program to reduce greenhouse gases. The voters this fall must decide an important question: Who is the best candidate to make that happen?
Following Senator John McCain's May 12 speech on global warming, many hastily praised the Republican presidential candidate for breaking ranks with President Bush and his own party's orthodoxy by calling for mandatory greenhouse gas reductions. But we should not be so quick to give McCain kudos. While McCain represents an improvement over eight long years of denial and inaction by the Bush administration, being better than the current president is not good enough. In fact, McCain's record and recent proposals raise real questions about his commitment to the bold measures we need to combat global warming.
If McCain's version of straight talk on the environment means missing key votes for clean low-carbon energy, then we have a lot to worry about. Twice, in December and February, when the Senate failed by one vote to extend key production tax incentives for wind and solar power, McCain not only didn't vote but said subsequently he would have opposed these measures. Senator Barack Obama, the Democratic presidential candidate, voted for them.
While many agree that a "cap and trade" program is probably the best mechanism to achieve the necessary reductions in greenhouse gases, McCain's "cap and trade" proposal comes up notably short. Take, for example, the issue of allocation of allowances to emit greenhouse gases. McCain would initially distribute all of the allowances free of charge to emitters, which the experts agree would likely mean a windfall to these polluters. McCain would have Congress punt to an unelected commission to make a decision - somewhere down the road - on when and in what amounts allowances might be auctioned. Obama advocates a 100 percent auction of allowances from the start. He would use the revenues generated by the auction to help consumers meet energy costs and promote clean technologies.
McCain would also allow polluters to meet all of their obligations by buying emission reductions, or "offsets," from other sectors of the economy or from outside the United States. By opening the door to unlimited offsets, McCain's approach would invite polluters to take credit for alleged reductions that cannot be verified and allow the highest emitting sources to continue operating dirty facilities indefinitely. Obama would limit the use of offsets and would direct EPA to examine rigorously any offsets used.
In addition to a strong cap and trade program, other tools will be required to achieve a serious reduction in greenhouse gas emissions. Once again McCain's positions come up short. His global warming plan specifically rejects tighter building standards for energy-efficient homes as burdensome regulation. But then, McCain has repeatedly voted against national renewable electricity standards similar to the standards already adopted in nearly half of the states. By contrast, Obama has made ambitious proposals to boost development and deployment of new efficiency and renewable energy technologies.
Oil Giants Keep Billions In Tax BreaksJune 10, 2008 14:39 With oil companies receiving more than $4 for each gallon of gas they sell, Senate Democrats today tried to eliminate the $17 billion in tax breaks Congress has awarded them in recent years.
It also imposed a windfall profits tax.
But Republicans wanted nothing to do with either. In a largely party line vote, they blocked the Democrats’ attempt to bring the tax issue to a vote, so it died on the Senate floor.
For the record, Republicans Kit Bond of Missouri and Sam Brownback and Pat Roberts of Kansas all basically voted to continue the oil company tax breaks. Missouri Democrat Claire McCaskill voted to kill them, the tax breaks that is.
"…if the choice is to do nothing, then I hope the people of this country rise up and scream like they've never screamed before," she said on the Senate floor. "How…dare us do nothing? That is what they're ready to vote on, saying, ‘We're not going to let you proceed to do something about this problem.’ It take a lot of nerve, Mr. President, it takes a lot of nerve."
"I’m from the Show-Me State," Bond said in a statement after the vote, "and you can’t show me a time when raising taxes on something lowered its price or increased its supply. With $4 a gallon gas, we need real solutions that open up supplies of energy here at home and give American families the relief they need."
Roberts spokeswoman Sarah Little said he opposed a vote on abolishing the tax breaks because if it passed, he believes it would amount to a tax increase on the oil companies and result in even higher gas prices.
Brownback aide Brian Hart said the Kansas Republican also opposed the tax increases in the bill. Hart said Brownback didn't think the measure did anything to increase energy supplies.
Republicans Block Extra Taxes On Oil CompaniesJune 10, 2008 11:29 Senate Republicans blocked a proposal Tuesday to tax the windfall profits of the largest oil companies, despite pleas by Democratic leaders to use the measure to address America's anger over $4 a gallon gasoline.
The Democratic energy package would have imposed a tax on any "unreasonable" profits of the five largest U.S. oil companies and given the federal government more power to address oil market speculation that the bill's supporters argue has added to the crude oil price surge.
"Americans are furious about what's going on," declared Sen. Byron Dorgan, D-N.D., and want Congress to do something about oil company profits and "an orgy of speculation" on oil markets.
But Republicans argued the Democratic proposal focusing on new oil industry taxes is not the answer to the country's energy problems.
"The American people are clamoring for relief at the pump," said Sen. Pete Domenici, R-N.M., but if taxes are increased on the oil companies "they will get exactly what they don't want. The bill will raise taxes, increase imports."
The Democrats failed, 51-43, to get the 60 votes needed to overcome a GOP filibuster and bring the energy package up for consideration.
An Unlikely Champion -- A Former Supreme Court Justice -- Promotes Computer Games As A Way To Change SocietyJune 05, 2008 16:25 Sandra Day O’Connor does not play video games. But she believes in their potential.
In her keynote speech at the Games for Change conference in New York on Wednesday, the retired Supreme Court justice discussed her latest project, “Our Courts,” an online interactive digital game and civics curriculum designed for seventh to ninth graders.
At the age of 78, Justice O’Connor is, by her own admission, an unlikely game developer.
“If you had told me when I retired from the Supreme Court two years ago that I would be speaking at a digital game conference, I would have been very skeptical. I’d maybe think you had one drink too many,” she said, to appreciative laughter. “I have not had much exposure to this world.”
In fact, she considers herself “relatively illiterate as a computer user,” and got into the games industry in a way that most developers do not.
In September 2006, about eight months after Justice O’Connor retired from the court, she, along with Justice Stephen Breyer, organized a two-day conference on the state of the judiciary at the Georgetown University Law Center, in Washington.
“In recent years I became concerned about vitriolic attacks on judges,” she said, attacks that came from members of Congress and other interest groups.
“These attacks have come with various attempts to try to influence judicial decision making,” she added. “On the federal level, we have seen troubling calls by members of the U.S. Senate to require a judicial nominee to state how they will rule on particular cases during the confirmation process. On the state level, powerful interest groups are pouring more and more money into those states that require partisan election of state judges. With partisan attacks and political pressure mounting, it’s much more difficult to achieve fair and impartial judgments.”
The Georgetown conference tackled these issues, and the outcome was a consensus that “public education was the only long-term solution to preserving an independent judiciary, and more importantly, to preserving a robust constitutional democracy,” said Justice O’Connor.
Citing a statistic that young people spend more time consuming media than they do in school or with their parents, she added that if the goal is “to engage young people and show them that that the government does have a real impact on their lives, and they can have a real impact on government, then we need to impart what we know via a media they’re comfortable with: a computer screen.”
Us Lawmakers Brace For Fight With Bush, Big Oil On Climate Change BillJune 03, 2008 11:30 US lawmakers braced Monday for a fight to push a sweeping climate change bill through the Senate, as President George W. Bush threatened to veto it and other opponents railed that it was economically unsound.
The legislation, known as the Lieberman-Warner bill after its sponsors, Senators Joe Lieberman and John Warner, calls for a "cap and trade" system, under which companies can trade permits giving them the right to emit a certain amount of pollution, "capped" below current emission levels.
Bush warned that the bill "would impose roughly six trillion dollars of new costs on the American economy," and was the "wrong way to proceed."
White House spokeswoman Dana Perino said Bush would veto the bill "if it were to pass in its current form."
But at an outdoor news conference held in the shadow of the US Congress, lawmakers from both parties, environmental activists, and business leaders vowed to fight to get the bill through the legislature.
Lieberman, a Democrat, called on lawmakers to pass the legislation and help the United States to "get back into the international leadership to do something about global warming."
"We created a lot of this problem and we have got to be now a part of the solution," he said
The bill would help break the United States' "addiction to oil", Democratic Senator Barbara Boxer, chair of the Senate Environment and Public Works Committee, said to a cheer from activists, business and religious leaders.
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