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Archive for May, 2010

I would like to thank all the veterans who have served this great country of ours.

Your personal sacrifices and service are well appreciated.  May God bless you all and your families for enduring the hardship that you have suffered for our country.  Thank you.

Gulf Oil Spill Still Out of Control

WASHINGTON — If the growing oil disaster in the Gulf of Mexico isn’t contained soon — and the latest efforts suggest that’s unlikely — then the damage to the fragile region will intensify over the coming summer months as changing currents and the potential for hurricanes complicate the containment and cleanup efforts.

“It’s all lose, lose, lose here,” said Rick Steiner, a retired University of Alaska marine scientist who’s familiar with both the current Gulf oil spill and the Exxon Valdez disaster two decades ago.

“The failure of the top kill really magnified this disaster exponentially,” he said. “I think there’s a realistic probability that this enormous amount of oil will keep coming out for a couple months. This disaster just got enormously worse.”

Gulf Oil Spill Far Worse Than Exxon Valdez Accident

COVINGTON, La. – An untested procedure to plug the blown-out oil well in the Gulf of Mexico seemed to be working, officials said Thursday, but new estimates showed the spill has already surpassed the Exxon Valdez as the worst in U.S. history.

A team of scientists trying to determine how much oil has been flowing since the offshore rig Deepwater Horizon exploded April 20 and sank two days later found the rate was more than twice and possibly up to five times as high as previously thought.

What is an Emergency?

Congress is about to pass an additional $32 billion emergency spending package to pay for the war In Afghanistan. It will have overwhelming bipartisan support, with legislators eager to display their fealty to the troops in an election year.

At the same time, the Congress is struggling with a $23 billion bill to forestall the layoff of nearly 300,000 teachers next year, championed by Sen. Tom Harkin and Rep. George Miller. This faces a Republican filibuster and the opposition of many blue Dog Democrats, who argue that it shouldn’t be considered emergency spending.

What kind of country are we?

In the worst economic recession in 70 years, competitive industrial nations must choose their priorities — what gets saved, what must be sacrificed. No sensible leadership would choose to make children — particularly the children of working and poor families — pay the cost of the downturn.

This surely is how great nations decline.

Like Rome and Britain before us, Washington now chooses to police the world, even as it cuts back the education of the nation’s most vulnerable children. We fight two wars on the other side of the world, spend more defending South Korea from North Korea than the South Koreans do, increase military spending already nearly as great as the rest of the world combined while saying we can’t afford vital investments at home.

P.S. Please don’t give me lectures on our debt and the need to “pay for it.”

Conservatives in both parties don’t demand we pay for the increased so-called “emergency” spending for Afghanistan. And they oppose many ways to “pay for it” that would be immensely popular with their voters, but not their donors: tax the big banks, slow speculation with a financial speculation tax, end the “carried interest” scam that has billionaire private equity managers paying a lower tax rate than their secretaries.

Predictable Blowback

Imagine, if you can, an alternate universe.

Imagine that in this alternate universe, a foreign military power begins flying remote-controlled warplanes over your town, using on-board missiles to kill hundreds of your innocent neighbors.

Now imagine that when you read the newspaper about this ongoing bloodbath, you learn that the foreign nation’s top general is nonchalantly telling reporters that his troops are also killing “an amazing number” of your cultural brethren in an adjacent country.

Imagine further learning that this foreign power is expanding the drone attacks on your community despite the attacks’ well-known record of killing innocents. And finally, imagine that when you turn on your television, you see the perpetrator nation’s tuxedo-clad leader cracking stand-up comedy jokes about drone strikes — jokes that prompt guffaws from an audience of that nation’s elite.

Ask yourself: How would you and your fellow citizens respond? Would you call homegrown militias mounting a defense “patriots” or would you call them “terrorists”? Would you agree with your leaders when they angrily tell reporters that violent defiance should be expected?

The Coming Debt Crisis

SAN FRANCISCO (MarketWatch) — The financial crisis never really went away.

The debt mountain that brought down some of the world’s biggest banks and dragged the international financial system to the brink of disaster has simply shifted to governments. Now, it’s threatening countries around the globe and if left unchecked could rip the very fabric of Europe’s economic system and wreck economic recoveries in the U.S., China and Latin America.

The impact on markets has been severe. The euro has slumped more than 12% against the dollar since the sovereign debt crisis flared in southern Europe. Gold has marched to new highs as investors seek a safe haven and, perhaps most alarming, it is now more expensive to buy insurance against national default than it is to insure against corporate failure.

“The sovereign debt crisis spun out of control in the past week, and we see no easy way to resolve it,” said Madeline Schnapp, director of macroeconomic research at TrimTabs Investment Research.

Some investors and analysts are increasingly concerned that governments may be no more capable of repaying their debts than the banks and insurance companies they saved. And, they warn, if a major country comes close to default, it could trigger a financial meltdown that would eclipse the panic that followed the bankruptcy of Lehman Brothers in 2008.

“The problem of the western world is that we have too much debt,” said Daniel Arbess, who manages the Xerion investment strategy at Perella Weinberg Partners. “Rather than reducing our debt, we’ve been moving it from one balance sheet to another.”

“All we’re doing is shifting chairs on the deck of the Titanic,” he added.

It’s Not Our Fault

WASHINGTON — BP PLC told Congress Tuesday its massive Gulf oil spill was caused by the failure of a key safety device made by another company.

In turn, that company says BP was in charge, and that a third company that poured concrete to plug the exploratory well didn’t do it right. The third company, which was plugging the well in anticipation of future production, says it was only following BP’s plan.

The blame game shot into the open Tuesday as the Senate began a hearing into the oil spill that has been contaminating water in the Gulf of Mexico for three weeks and threatens sensitive marshes and marine life from Louisiana to Texas.

Executives of the three companies, all scheduled to testify before the Senate Energy and Natural Resources Committee, are trying to shift responsibility for the environmental crisis to each other, according to prepared testimony.