reality is only those delusions that we have in common...

Saturday, September 23, 2017

week ending Sept 23

  An evidence-based Fed would hold rates steady in September – EPI - The Federal Open Market Committee (FOMC) meets today and tomorrow to determine whether or not to raise interest rates. The FOMC has raised rates three times since December 2016. The evidence arguing that these increases were wise or necessary was thin at best. That rationale for raising interest rates is to rein economic growth that threatens to drive down unemployment so low that workers will be empowered to achieve unsustainably large wage increases. The worry is that such wage increases could push price inflation over the Fed’s target rate. But the real-world data that exists on every link of this causal chain shows that such worries are baseless. Economic growth in recent quarters is depressingly slow, not fast. Unemployment rates are in the low-end of historical experience, but have been lower (without wage or price inflation) several times in recent years. Other measures of labor market slack show the economy is far from recovered. Wage growth shows little sign of accelerating to levels that would spark wage-price spirals.The rate increase that happened in June was particularly dispiriting for those hoping the Fed would continue to follow the evidence-based approach largely adhered to under the reign of Janet Yellen as Fed Chair. The economic data going into that meeting gave plenty of reasons why a data-dependent Fed might worry that it was riskier to raise rates too high too soon than to stand pat for a couple of months. Yet the Fed raised rates. Data since June has been much softer. The Fed’s preferred inflation measure has decelerated significantly, and any upward creep of wage growth has stopped. There just is no case for continuing to raise rates in the face of this data.

 FOMC Statement: "In October, the Committee will initiate the balance sheet normalization program" - FOMC Statement: Information received since the Federal Open Market Committee met in July indicates that the labor market has continued to strengthen and that economic activity has been rising moderately so far this year. Job gains have remained solid in recent months, and the unemployment rate has stayed low. Household spending has been expanding at a moderate rate, and growth in business fixed investment has picked up in recent quarters. On a 12-month basis, overall inflation and the measure excluding food and energy prices have declined this year and are running below 2 percent. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed, on balance. Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. Hurricanes Harvey, Irma, and Maria have devastated many communities, inflicting severe hardship. Storm-related disruptions and rebuilding will affect economic activity in the near term, but past experience suggests that the storms are unlikely to materially alter the course of the national economy over the medium term. Consequently, the Committee continues to expect that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace, and labor market conditions will strengthen somewhat further. Higher prices for gasoline and some other items in the aftermath of the hurricanes will likely boost inflation temporarily; apart from that effect, inflation on a 12-month basis is expected to remain somewhat below 2 percent in the near term but to stabilize around the Committee's 2 percent objective over the medium term. Near-term risks to the economic outlook appear roughly balanced, but the Committee is monitoring inflation developments closely.  In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 1 to 1-1/4 percent. The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation. […] In October, the Committee will initiate the balance sheet normalization program described in the June 2017 Addendum to the Committee's Policy Normalization Principles and Plans.

Fed balance-sheet runoff could rock fiscal boat - The Federal Reserve is sailing into uncharted waters. The U.S. central bank will start shrinking its $4.5 trillion balance sheet next month. The timing is risky, with lawmakers set to spar again over government funding and the debt ceiling. The Fed’s portfolio downsizing will also cut the nearly $92 billion it sent to Treasury last year, adding to budget pressures. As expected, the Fed on Wednesday set a start date for its effort to reverse the balance-sheet expansion it undertook in response to the 2008 financial crisis, following a step-by-step plan unveiled in June. It will gradually stop reinvesting the proceeds from repayments of Treasury bonds and mortgage-backed securities, allowing up to $30 billion in assets to roll off the balance sheet in the first three months of the process. Once ramped up, the portfolio could shrink by $150 billion a quarter. Though the Fed doesn’t seem to anticipate market disruption, one economist speaking at the Shadow Open Market Committee fall meeting on Friday argued that balance-sheet reduction is, in its ultimate effect, equivalent to raising interest rates. Moreover, the unprecedented shift will coincide with another fiscal showdown in Congress. Earlier this month, lawmakers approved a three-month delay in setting government funding for 2018 and raising the $20 trillion federal-debt ceiling. The new deadline is Dec. 8. If there is no deal by then, the government could partially shut down and the clock would start counting down to the possibility of a government default. In the meantime, the U.S. deficit continues to grow. It’s estimated to hit $693 billion this year, an 18 percent jump from 2016, according to the Congressional Budget Office. The Fed’s balance sheet reduction could worsen that. Its remittances to the Treasury have topped $90 billion a year for the last several years, but a smaller portfolio will mean less interest income. Before the financial crisis, the Fed’s balance sheet was under $1 trillion and in 2008 the central bank sent only about $32 billion to the Treasury. 

It May Take Until 2022 for G-3 Central Banks' Assets to Shrink - The Federal Reserve’s projected move Wednesday to start shrinking its balance sheet is just the first step on what’s set to be a very, very long road of policy-stimulus unwinding by the big three developed-world central banks. European Central Bank officials have only just begun considering how to taper their asset purchases, perhaps in 2018, while the Bank of Japan maintains that it’s still too early to discuss an exit from its mega-stimulus. Stephen Jen, the London-based chief executive of hedge fund Eurizon SLJ Capital Ltd., sees the cumulative G-3 balance sheet staying at current levels or higher through 2021. Another aspect to consider: each unwind of policy stimulus, at least in the Fed’s case, leaves the benchmark lower than its pre-recession starting point. And the unwind takes longer.

  • The unwinding of policy stimulus from the 2001 recession and early 2000s tech bust took two years, from 2004-06.
  • The unwinding of Fed easing from the 1990-91 recession took about one year, from 1994-95.

The Federal Reserve is peddling ‘Tinker Bell economics’ - Was last week’s 0.4% increase in the consumer price index (CPI) for August enough to convince a wary Federal Reserve that inflation is finally on track to hit 2%? I doubt it. The big contributors to the increase in the CPI last month were gasoline (+6.3%), a knee-jerk reaction to expected damage to Gulf Coast refineries from Hurricane Harvey; and shelter (+0.5%), which accounts for one-third of the index and increased at its fastest pace in 12 years.  Some economists were reassured by the 0.2% increase in the core CPI after five consecutive monthly increases of 0.1% or less. The August increase raised the 3-month annualized change to 1.9% compared with 0% in May. For a Fed that has spent the better part of five years wishing, hoping, for inflation to rise — and stands ready with a list of excuses to explain the chronic undershoot — policy makers will need more than one month to convince themselves that the end, 2% inflation, is in sight. (The Fed’s preferred inflation measure is the personal consumption expenditures price index, not the CPI.) Policy makers have been grasping at straws, some of which are quite thin, to explain the disconnect between the tight labor market and low inflation. Maybe they should start with their flawed model. Almost every discussion on this subject begins with a statement of fact that the tight labor market, as evidenced by the 4.4% unemployment rate, should be lifting wages and prices. Note the order: wages and prices. A tight labor market leads to higher wages, which lead to higher prices. This is one of those myths that never dies: cost-push inflation. Milton Friedman was adamant that both prices and costs rise in response to an increase in aggregate demand, which is a function of the Fed’s money creation. Wage and price increases are a reflection of inflation, not a cause of it. As to the relationship between prices and wages, they generally move together. But prices lead wages, not the other way around. You can read about the relationship in academic literature, or you can think about how businesses operate.

Yellen "Does Not Fully Understand Inflation" So Here It Is Explained In Just One Chart - In what has been the most stunning admission by Janet Yellen so far during her press conference, the Fed Chair said that "we don't fully understand inflation" and adds that the "shortfall of inflation this year is more of a mystery." Which is why we would like to do the Fed a favor and "explain" inflation, or the lack thereof as the Fed laments, with just one chart. To simplify enough that everyone on the FOMC will understand, here it is:

  • Real economic prices: no inflation.
  • Asset prices: rampant, and in some case soaring, inflation.

And just in case there is still confusion, here is Goldman: The long economic cycle that we have been enjoying is, in part, a reflection of loose monetary conditions and low interest rates. Exhibit 17 is a simple but effective way to demonstrate this effect. Taking data back to 2009, the start of the period of extraordinary monetary policy, we can see a very big difference between ‘prices’ in the real economy – measures of wages, consumer price inflation, house prices, commodities – and asset prices. Also shown here is the long-run average nominal GDP growth and nominal GDP growth over this period for the US and Europe (in red). Financial assets have significantly outstripped both nominal GDP growth and inflation in the real economy, largely as a result of rates staying low. So, dear Janet, if you are so worried about the shortfall in inflation, maybe take a look at asset prices instead...

The Fed’s forecasts imply a tough (recessionary?) 2020 – FT Alphaville - The Federal Reserve released forecasts through the year 2020 for the first time on Wednesday. Those forecasts imply that America’s central bankers will deliberately tighten monetary policy to slow the US economy, possibly to the point of outright recession, by the early 2020s.Every few months, the Fed polls the members of the Open Market Committee, which sets monetary policy, to ask them how they think real output, unemployment, and inflation will behave under “appropriate monetary policy” for the next several years. They also ask everyone where they think short-term interest rates should be at the end of each year.There is no way to identify each individual set of forecasts. At least some policymakers think core inflation should be 2.2 per cent in 2019 and 2020, compared to the consensus of 2.0 per cent. Are these the same people who think short term interest rates should be unchanged from their current level in 2020, or are they those who want the policy rate to rise by nearly three percentage points? We currently have no way to know, which makes it difficult to assess how individual central bankers view the underlying forces affecting the economy and how monetary policy should respond. With that caveat, it is possible to look at the distribution of forecasts to assess how the FOMC as a whole is thinking about the economy. Take a good look at the table below, with our highlights:

 3Q17 GDP Forecast Unchanged -- Remains At A Disappointing 2.2% -- September 19, 2017 -- GDP Now's latest forecast: The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2017 is 2.2 percent on September 19, unchanged from September 15. The forecast of third-quarter real residential investment growth is -2.6 percent, virtually unchanged from last Friday, after this morning's new residential construction release from the U.S. Census Bureau.  The forecast of the contribution of net exports to third-quarter real GDP growth declined from -0.11 percentage points to -0.16 percentage points after this morning's Import/Export Price Indexes release from the U.S. Bureau of Labor Statistics.

Trump's debt ceiling deal with Schumer, Pelosi stunned White House budget director - Count White House budget director Mick Mulvaney among those who were stunned by President Trump's Oval Office debt ceiling deal last week with Democratic congressional leaders Chuck Schumer and Nancy Pelosi. "That was not the outcome that I expected from that meeting," Mulvaney told CBS News Chief White House Correspondent Major Garrett and Political Director Steve Chaggaris on this week's episode of "The Takeout" podcast. Despite the unexpected outcome, Mulvaney declared the deal "an absolute and unadulterated success." "And in fact, the more I think about it now, the more I think about all the good things that will come out of that for this administration," Mulvaney said. He's concluded that "decoupling" the debt ceiling from the fight to get a spending bill passed will give Congress more time to deal with its tax measure and will give Republicans an opportunity to "prove we can govern." Mulvaney also reacted to Steve Bannon's accusation during his "60 Minutes" interview with Charlie Rose that Republican congressional leaders "do not support the president's program." "It's an interesting way to put it. I think I draw some of the same conclusions that Bannon does, that clearly we've had a difficult time getting a lot of our agenda, any of our agenda, passed," Mulvaney explained. "Whether or not that means they're out to get us, or they're just not capable of delivering, could be subject to interpretation."

Outlets That Scolded Sanders Over Deficits Uniformly Silent on $700B Pentagon Handout -- Where did all the concern over deficits go? After two years of the media lamenting, worrying and feigning outrage over the cost of Bernie Sanders’ two big-budget items—free college and single-payer healthcare—the same outlets are uniformly silent, days after the largest military budget increase in history. Monday, the Senate voted to increase military spending by a whopping $81 billion, from $619 billion to $700 billion—an increase of over 13 percent. (The House passed its own $696 billion Pentagon budget in July—Politico, 7/14/17.) The reaction thus far to this unprecedented handout to military contractors and weapons makers has been one big yawn. No write-ups worrying about the cost increase in the Washington Post or Vox or NPR. No op-eds expressing concern for “deficits” in the New York Times, Boston Globe or US News. No news segments on Fox News or CNN on the “unaffordable” increase in government spending. All the outlets that spent considerable column inches and airtime stressing over Sanders’ social programs are suddenly indifferent to “how we will afford” this latest military giveaway. The US government votes 89–9 to add $81 billion extra to the balance sheet—the equivalent of the government creating three new Justice Departments, four more NASAs, seven Treasury Departments, ten EPAs or 546 National Endowments for the the Arts—and there’s zero discussion as to “how we will pay for it.”

Tillerson Vows ‘Peaceful Pressure Campaign’ Against North Korea --The U.S. seeks a peaceful resolution but is prepared to use military force if diplomatic efforts fail to end the nuclear standoff with North Korea, said Secretary of State Rex Tillerson. “If our diplomatic efforts fail, though, our military option will be the only one left,” Tillerson said on CBS’s “Face the Nation.” “But be clear: we seek a peaceful solution to this.”The top U.S. diplomat made a rare appearance on a Sunday talk show as President Donald Trump prepares this week to ask allies at the annual United Nations General Assembly to confront the regime’s threat. Trump, in a Sunday tweet, mocked North Korean leader Kim Jong Un as “Rocket Man.” Tillerson said the U.S. strategy is to pursue a “peaceful pressure campaign” based on what he called the four “nos”: not seeking either regime change or collapse in North Korea, an accelerated re-unification of the Korean peninsula, or a reason to send in military forces.The UN has passed two rounds of sanctions against North Korea, which has continued nonetheless to advance its nuclear program and test its missile capabilities despite condemnation from the international community. UN Ambassador Nikki Haley said Sunday on CNN’s “State of the Union” that Pyongyang is “already starting to feel the pinch” from the additional sanctions of more than $1 billion. “We have economically strangled North Korea at this point, and they have said as much,” she said.

 Trump mocks ‘Rocket Man’ Kim Jong-un as advisers issue warnings Guardian - Advisers to Donald Trump have warned North Korea to give up its nuclear weapons programmes, saying that the regime faced destruction if it continued its reckless behaviour and forced the US to defend itself or its allies. The warning came on Sunday after Trump tweeted about a phone call to South Korean president Moon Jae-in, and appeared to mock Kim Jong-un.“I spoke with President Moon of South Korea last night,” the US president wrote. “Asked him how Rocket Man is doing. Long gas lines forming in North Korea. Too bad!” The latest bellicose language from Washington came just days after North Korea fired another ballistic missile, which overflew Japan, and Kim boasted that such efforts would continue as his country neared its goal of “equilibrium” in military force with the US. Nikki Haley, US ambassador to the United Nations, said North Korea was starting to “feel the pinch” of being “economically strangled” as recent sanctions have caused the country to be “cut off from the world”. But, she said, diplomatic and other non-military options were running out. “If North Korea keeps on with this reckless behavior, if the United States has to defend itself or defend its allies in any way, North Korea will be destroyed,” the former South Carolina governor told CNN’s State of the Union. “We all know that and none of us want that. None of us want war. But … something is going to have to be done.”

'Rocket man is on a suicide mission': Trump threatens to 'totally destroy North Korea' in major UN speech: President Donald Trump blasted the North Korean government during his speech to the United Nations General Assembly on Tuesday. In denouncing the "scourge of our planet," which he said was a "small group of rogue regimes that violate every principle on which the United Nations is based," Trump took aim at Kim Jong Un, the North Korean leader. In recent weeks, North Korea has ramped up its missile tests, sending shockwaves through world governments. "No one has shown more contempt for other nations and for the well-being of their own people than the depraved regime in North Korea," Trump said. "It is responsible for the starvation deaths of millions of North Koreans and for the imprisonment, torture, killing, and oppression of countless more." Trump accused North Korea of torturing Otto Warmbier, an American college student who was imprisoned in the country for roughly a year and died within days of being returned to the US in June, as well as of assassinating Kim's half-brother earlier this year and kidnapping a teenage Japanese girl. "If this is not twisted enough, now North Korea's reckless pursuit of nuclear weapons and ballistic missiles threatens the entire world with unthinkable loss of human life," Trump said. "It is an outrage that some nations would not only trade with such a regime, but would arm, supply, and financially support a country that imperils the world with nuclear conflict." That was a clear shot at China, North Korea's largest trading partner. Trump said that if North Korea didn't back down from its nuclear provocations, the US would "have no choice but to totally destroy North Korea." "No nation on earth has an interest in seeing this band of criminals arm itself with nuclear weapons and missiles," Trump said.  "Rocket man is on a suicide mission for himself and for his regime," he continued, using his nickname for Kim. "The United States is ready, willing, and able, but hopefully this will not be necessary. That's what the United Nations is all about. That's what the United Nations is for. Let's see how they do."

Donald Trump threatens ‘total destruction’ of North Korea over nuclear programme during UN address | South China Morning Post - US President Donald Trump, in a combative debut speech to the UN General Assembly, threatened the “total destruction” of North Korea if it does not abandon its drive towards nuclear weapons. Trump, who has ramped up his rhetoric throughout the escalating crisis with North Korea, told the murmuring crowd at the UN that “it is far past time for the nations of the world to confront” Kim Jong-un and said that Kim’s “reckless pursuit of nuclear weapons” poses a threat to “the entire world with an unthinkable loss of human life”. “Rocket man is on a suicide mission for himself and his regime,” Trump said about the North Korean leader. He said of the US: “If it is forced to defend itself or its allies, we will have no choice but to totally destroy North Korea.” Rocket man is on a suicide mission for himself and his regime. If [the US] is forced to defend itself or its allies, we will have no choice but to totally destroy North Korea Trump, who has previously warned of “fire and fury” if Pyongyang does not back down, claimed that “no one has shown more contempt for other nations and for the well-being of their own people than the depraved regime in North Korea”. And he scolded nations that he said have enabled and traded with North Korea, seeming to slight China, though he did not mention it by name. Elected on the nationalist slogan “America First”, Trump argued that individual nations should act in their own self-interest, yet rally together when faced with a common threat. In addition to North Korea, Trump urged nations to join together to stop Iran’s nuclear programme – he declared the Iran nuclear deal an “embarrassment” for the US – and defeat the “loser terrorists” who have struck violence across the globe. 

Trump’s North Korea threat leaves Asia struggling to explain  (AP) — Was it a bluff? A warning that Washington would shoot down North Korea's next missile test? A restatement of past policy? Or simply just what it seemed: a straightforward threat of annihilation from the president of the United States? Officials and pundits across Asia struggled Wednesday to parse Donald Trump's vow Tuesday at the U.N. General Assembly to "totally destroy North Korea" if provoked. In a region well used to Pyongyang's pursuit of nuclear weapons generating a seemingly never-ending cycle of threats and counter-threats, Trump's comments stood out. South Korea officially played them down, while some politicians worried that Trump's words signaled a loss of influence for Seoul. Tokyo focused on his mention of Japanese citizens abducted by the North. Analysts across Asia expressed surprise, worry, even wry amusement, in one case, that Trump's words seemed to mirror threats normally emanating from North Korean state media. Amid the speculation, the focus of Trump's belligerence, North Korea, remained silent in the hours after the speech.

Tensions to rise’ after Trump’s North Korea comments -- US President Donald Trump's highly-combative remarks against North Korea and its leader at the United Nations will only harden Pyongyang's resolve to continue developing its nuclear programme, analysts have warned. Using what was described as "unprecedented" language, Trump made his debut address at the UN General Assembly (UNGA) on Tuesday. In a wide-ranging 45-minute speech, the most anticipated foreign policy address of his tenure, Trump vowed that the US would "totally destroy" North Korea if it is forced to defend itself or its allies.He also mocked Kim Jong-un, North Korea's leader, saying: "Rocket Man is on a suicide mission for himself and for his regime. The United States is ready, willing and able, but hopefully, this will not be necessary." The sharp escalation in rhetoric came weeks after Trump warned that North Korea would be met with "fire and fury like the world had never seen" if it continues expanding its nuclear programme. "I expected him to talk tough and strong - but I did not expect him to talk quite that tough and quite that strongly," said Donald Kirk, a journalist and author of several books on Korea.He said Trump's remarks made the prospect of negotiations extremely unlikely. "North Koreans are not going to back down - if anything they are going to increase the tempo of their programme," Kirk told Al Jazeera from South Korea's capital, Seoul. "I think we can forget about North Korea saying, 'let's go to negotiations.'" Kirk also said he expected that Trump's fiery approach would not be adopted by other leaders who are otherwise highly critical of North Korea's actions. "We are in for some quite interesting questions here, and a lot of it is not going to be favourable to Trump," he said. "I get the general impression that tensions will increase and the line is drawn ever deeper."

Trump's "Fiery" United Nations Speech: Full Transcript - (video) In a speech that commentators have said "the likes of which have never been heard by a U.S. leader in the United Nations", President Trump did not disappoint expectations that his first appearance at the UN would be a fiery, memorable affair, and while laying out his view for a "nationalist" basis to US foreign policy, focusing on state sovereignty as the framework for the "great revival of nations" and future international relations while vowing to "always put America first", Trump slammed “the scourge of our planet which is a group of rogue regimes" listing North Korea, Iran, Venezuela, while also taking shots at Saudi Arabia and China. In a forceful endorsement of nationalism around the world, Trump called for a "great reawakening of nations, for the revival of their spirits, their pride, their people and their patriotism." Saying that "major portions of the world are in conflict and some, in fact, are going to hell", Trump most memorable comment was that the United States will be forced to “totally destroy” North Korea unless Pyongyang backs down from its nuclear challenge, mocking North Korean leader Kim Jong Un as a “rocket man” on a suicide mission, a comment which was followed by loud murmuring around the assembly. "If it the US forced to defend itself or its allies, we will have no choice but to totally destroy North Korea. Rocket man is on a suicide mission for himself and his regime" adding that North Korea’s pursuit of nuclear weapons and ballistic missiles “threatens the entire world with unthinkable cost of human life.”  On Iran, which he called an “economically depleted rogue state that exports violence"  Trump said the 2015 nuclear deal negotiated by Barack Obama was an embarrassment and hinted that he may not recertify the agreement when it comes up for a mid-October deadline. “I don’t think you’ve heard the last of it." On Venezuela, Trump said the collapsing situation there “completely unacceptable” and said the United States cannot stand by and watch. He warned the United States was considering what further actions it can take. “We cannot stand by and watch."’

Kim Jong Un Vows To Tame "Mentally Deranged Dotard" Trump "With Fire" -  The verbal soap opera continues. Just hours after North Korea's foreign minister Ri Yong-ho called Donald Trump a "barking dog", the rogue state's president, Kim Jong-Un called President Donald Trump “a frightened dog” and a “gangster fond of playing with fire” in an official yet fiery statement on Thursday.Reacting to Trump's United Nation's speech in which the US president called Kim Jong Un “Rocket Man,” and threatened to "totally destroy" North Korea, Kim's response was nothing short of a macabre magnum opus of comic-hyperbolic fusion.“Far from making remarks of any persuasive power that can be viewed to be helpful to defusing tension, he made unprecedented rude nonsense one has never heard from any of his predecessors,” Kim said adding that "A frightened dog barks louder."Kim went on:"[Trump's] remarks remind me of such words as "political layman" and "political heretic" which were in vogue in reference to Trump during his presidential election campaign."The mentally deranged behavior of the U.S. president openly expressing on the UN arena the unethical will to "totally destroy" a sovereign state, beyond the boundary of threats of regime change or overturn of social system, makes even those with normal thinking faculty think about discretion and composure."After taking office Trump has rendered the world restless through threats and blackmail against all countries in the world. He is unfit to hold the prerogative of supreme command of a country, and he is surely a rogue and a gangster fond of playing with fire, rather than a politician."The North Korean then responded to Trump's hollow threat with one of his own:"I am now thinking hard about what response he could have expected when he allowed such eccentric words to trip off his tongue. Whatever Trump might have expected, he will face results beyond his expectation. I will surely and definitely tame the mentally deranged U. S. dotard with fire."

'A rogue' and a 'dotard': Kim Jong-un's statement on Trump in full --North Korea’s leader Kim Jong-un has once again upped his rhetoric against US president Donald Trump. Here is his statement in full:

What's a 'dotard' anyway? Kim's insult to Trump | Reuters: (Reuters) - North Korean leader Kim Jong Un has confused a lot of English-speakers - though this time not about what he intends with his nuclear program. Responding to U.S. President Donald Trump’s bellicose warning to Pyongyang in his first speech to the United Nations on Tuesday, Kim on Friday called Trump a “dotard” - at least in a translation by the state news agency KCNA. The obscure word is old - late Middle English, or around the 14th century - and means senile old person, someone in their dotage. Although Shakespeare and Tolkien used it, the word is barely heard these days and Kim’s statement caused a Twitter storm of questions to Merriam-Webster dictionary about its meaning, while searches on Google also increased. Merriam-Webster responded with a tweet, defining dotard as “a person in his or her dotage,” which is “a state or period of senile decay marked by decline of mental poise and alertness,” which quickly became the top trending post on Twitter on Friday, with more than 7,400 retweets and 13,000 likes. There were more than 100,000 mentions of the hashtag #dotard and 189,000 mentions of the word on Twitter on Friday, according to international social media analytics firm Talkwalker. On Google’s Ngram Viewer, which tracks the popularity of words over time, “dotard” was a word that peaked in the 18th century. Many social media users also took to Twitter to deliver their best jokes. “By making people look up the word #dotard, Kim Jong Un has done more for American education than Betsy DeVos,” wrote one user, @TurmUp_TheTweet. 

Trump targets Iran nuclear deal, Venezuela regime in UN speech -- US President Donald Trump on Tuesday attacked the Iran nuclear deal and said he was prepared to take further action against the Venezuelan government. In his first speech to the UN General Assembly, Trump repeated criticism of the Iran deal, calling it "an embarrassment to the United States." He accused Tehran of being a rogue state that uses the country's oil wealth to build "dangerous missiles," sponsor terrorism and destabilize the entire Middle East. "We cannot abide by an agreement if it provides cover for the eventual construction of a nuclear program," he said. "The Iran deal was one of the worst and most one-sided transactions the United States has ever entered into. Frankly, that deal was an embarrassment to the United States, and I don't think you've heard the last of it. Believe me." Next month, the Trump administration faces another deadline to certify to Congress whether Iran is complying with the nuclear deal. It has done so twice since taking office, despite continued rhetoric against the deal.On Venezuela, Trump said the US was "prepared to take further action" against President Nicolas Maduro's regime if it does not restore democracy and political freedom. The White House had said it would impose "strong and swift" sanctions on Venezuela, including a ban on imports of Venezuelan crude oil into the US, if Maduro went forward with a vote to elect a constituent assembly to redraft the country's constitution. The assembly was sworn in last month. 

Unmasked: Trump Doctrine vows carnage for new axis of evil - Pepe Escobar - One should allow the enormity of what just happened to sink in, slowly. The president of the United States, facing the bloated bureaucracy that passes for the “international community,” threatened to “wipe off the map” the whole of the Democratic People’s Republic of Korea (25 million people). And may however many millions of South Koreans who perish as collateral damage be damned. Multiple attempts have been made to connect Trump’s threats to the madman theory cooked up by “Tricky Dicky” Nixon in cahoots with Henry Kissinger, according to which the USSR must always be under the impression the then-US president was crazy enough to, literally, go nuclear. But the DPRK will not be much impressed with this madman remix. That leaves, on the table, a way more terrifying upgrade of Hiroshima and Nagasaki (Trump repeatedly invoked Truman in his speech). Frantic gaming will now be in effect in both Moscow and Beijing: Russia and China have their own stability / connectivity strategy under development to contain Pyongyang. The Trump Doctrine has finally been enounced and a new axis of evil delineated. The winners are North Korea, Iran and Venezuela. Syria under Assad is a sort of mini-evil, and so is Cuba. Crucially, Ukraine and the South China Sea only got a fleeting mention from Trump, with no blunt accusations against Russia and China. That may reflect at least some degree of realpolitik; without “RC” – the Russia-China strategic partnership at the heart of the BRICS bloc and the Shanghai Cooperation Organization (SCO) – there’s no possible solution to the Korean Peninsula stand-off. In this epic battle of the “righteous many” against the “wicked few,” with the US described as a “compassionate nation” that wants “harmony and friendship, not conflict and strife,” it’s a bit of a stretch to have Islamic State – portrayed as being not remotely as “evil” as North Korea or Iran – get only a few paragraphs. 

Pentagon chief says he was asked about reintroducing tactical nuclear weapons in South Korea – WaPo - Defense Secretary Jim Mattis acknowledged Monday that his South Korean counterpart inquired recently about reintroducing tactical nuclear weapons on the Korean Peninsula, a move that could take tensions with North Korea to a new high. Mattis, speaking to reporters at the Pentagon, confirmed that he and Defense Minister Song Young-moo discussed the weapons during an Aug. 30 visit in Washington. The Pentagon chief did not say whether he’d support such an idea, however. Song has advocated for the move, calling it an “alternative worth a full review.” Asked about the exchange, Mattis said that “we discussed the option,” but he declined to elaborate. The United States maintained nuclear weapons in South Korea during much of the Cold War, but President George H.W. Bush ordered their removal after the Soviet Union’s fall in 1991. At the time, Bush saw it as a way of bolstering demands that North Korea not pursue its own nuclear weapons. South Korean President Moon Jae-in has said several times that he is against the return of nuclear weapons, but he faces opposition on that point from many conservative leaders in his country. Tactical nuclear weapons, sometimes called nonstrategic nukes, are designed to strike military targets such as bunkers and tunnels but are still considered immensely powerful in their own right and a potential gateway to larger nuclear attacks. South Korea's President Moon Jae-in and President Trump agreed to exert stronger pressure through sanctions on North Korea Sept. 17.

Trump signs new order to expand North Korea sanctions - US President Donald Trump has signed an executive order allowing Washington to ramp up sanctions against North Korea over its nuclear missile programme. The move on Thursday came two days after Trump warned North Korean leader Kim Jong-un in his address at the UN General Assembly that the US, if threatened, would "totally destroy" his country of 26 million people. Announcing the executive order, Trump said the measure would allow sanctions against "individuals and companies that finance and facilitate trade" with Pyongyang. "Our executive order will cut off sources of revenue that fund North Korea's efforts to develop the deadliest weapons known to humankind," he added.Trump threatens to 'totally destroy' North Korea in UN speechIndustries set to be targeted include textiles, fishing, information technology and manufacturing.Pyongyang has resisted international pressure, conducting its sixth and largest nuclear test on September 3, and launching numerous missiles this year, including two intercontinental ballistic missiles and two other rockets that flew over Japan.Trump stopped short of going after North Korea's biggest trading partner, China, and praised its central bank for ordering Chinese banks to stop doing business with North Korea. He also did not mention Pyongyang's oil trade. Four sources told Reuters China's central bank has told banks to strictly implement United Nations sanctions against North Korea.

US to impose new North Korea sanctions targeting energy trade, shipping - The US will impose new sanctions designed to cut off funding for North Korea by targeting individuals and companies that trade with the Kim Jong-un regime, including those involved in energy, mining and shipping, Treasury Secretary Steve Mnuchin said Thursday.
In an executive order, President Donald Trump authorized the Treasury Department to impose sanctions on:

  • Industries: The construction, energy, financial services, fishing, information technology, manufacturing, medical, mining, textiles or transportation industries in North Korea.
  • Ports: Ownership, control or operation of any port in North Korea, including any seaport, airport or land port of entry.
  • Imports/Exports: At least one significant importation from or exportation to North Korea of any goods, services, or technology.
The order issues a 180-day ban from visiting the US on vessels and aircraft that have visited North Korea. The ban also includes vessels that have done a ship-to-ship transfer with a vessel that has visited North Korea within 180 days. "North Korea is dependent on its shipping networks to facilitate international trade," the White House said in a fact sheet about the executive order.While China is responsible for most trade with North Korea, Mnuchin said in a press conference that the order was not singling out any country.

Nearly 60% Of Americans Support 'Military Action' Against North Korea -- As tensions between the US, its regional allies and North Korea escalate to levels unseen since the end of the Korea war, more Americans are saying they would support some form of military action against the country as a “last resort” should the US’s “diplomatic efforts” fail to convince the regime to surrender, or at least arrest, its nuclear program, according to a Gallup poll. “As North Korea continues to launch test missiles and issue provocative threats against the U.S. and its allies in the region, a majority of Americans appear ready to support military action against that country, at least as a last resort. More specifically, 58% say they would favor taking military action against North Korea if economic and diplomatic efforts fail to achieve the United States' goals. This is significantly higher than the 47% in favor the last time Gallup asked this, in 2003.” The magnitude of the increase – more than 10 percentage points – represents a significant shift, according to the survey’s author, Lydia Saad. Even after Trump’s former chief strategist Steve Bannon let slip that the US doesn’t have a viable military alternative for North Korea  - at least, not one that wouldn’t end with hundreds of thousands of civilian casualties in Seoul - the president’s rhetoric (though growing a little tired) appears to have struck a chord with Americans, and particularly his conservative base, who voted for him on a platform of foreign noninterventionism that has been totally abandoned by his administration.According to Saad, the increase has been almost entirely partisan, with the percentage of Democrats who support war remaining relatively steady at around 40%, while the percentage of Republicans who would support a military intervention rose 23 percentage points to 82%.

No, We Cannot Shoot Down North Korea’s Missiles -- The number one reason we don’t shoot down North Korea’s missiles is that we cannot.  Officials like to reassure their publics about our defense to these missiles.    Japanese Chief Cabinet Secretary Yoshihide Suga told his nation after last week’s test, “We didn’t intercept it because no damage to Japanese territory was expected.”That is half true. The missile did not pose a serious threat. It flew over the Japanese island of Hokkaido, landing 3700 km (2300 miles) from its launch point near North Korea’s capital of Pyongyang.The key word here is “over.” Like way over. Like 770 kilometers (475 miles) over Japan at the apogee of its flight path. Neither Japan nor the United States could have intercepted the missile. None of the theater ballistic missile defense weapons in existence can reach that high.  It is hundreds of kilometers too high for the Aegis interceptors deployed on Navy ships off Japan. Even higher for the THAAD systems in South Korea and Guam. Way too high for the Patriot systems in Japan, which engage largely within the atmosphere. All of these are basically designed to hit a missile in the post-mid-course or terminal phase, when it is on its way down, coming more or less straight at the defending system. Patriot is meant to protect relatively small areas such as ports or air bases; THAAD defends a larger area; the advanced Aegis system theoretically could defend thousands of square kilometers. But could we intercept before the missile climbed that high? There is almost no chance of hitting a North Korean missile on its way up unless an Aegis ship was deployed very close to the launch point, perhaps in North Korean waters. Even then, it would have to chase the missile, a race it is unlikely to win. In the only one or two minutes of warning time any system would have, the probability of a successful engagement drops close to zero.

 Fearful Californians Prepare For A Nuclear Attack: "A Lot Of People Will Be Killed" - With each passing day and each new ICBM launch from a seemingly unhinged North Korean dictator, the fears of an attack on the U.S. mainland, though faint, increasingly weigh on the hearts and minds of Americans, particularly those in California.  As The Guardian points out today, those fears have even prompted a group of California public health officials and emergency responders to gather for a strategy session with Hal Kempfer, a retired marine lieutenant colonel, to discuss which areas are the most likely targets and how citizens should respond to an attack. Hal Kempfer, a noted international security expert, is getting a roomful of California public health officials and emergency responders to think about the unthinkable – a nuclear bomb exploding at the port of Long Beach, about four miles away.“A lot of people will be killed,” he said, “but a large percentage of the population will survive. They will be at risk and they will need help.” “If you want to mess up southern California, if you want to mess up the west coast, if you want to mess up our country – where do you attack?” Kempfer asks.“If I’m sitting in North Korea and looking at possible targets, I’m going to be looking at Long Beach very closely.” He talks about the port and downtown Long Beach being “toast” – no exaggeration, since the blast wave is likely to vaporize everything in its immediate path. But the city health department, the Long Beach airport and fire department might not be; they are all somewhat protected by a hilly area that is likely to halt the initial blast wave. And so the city can, tentatively, think about setting up a center of emergency operations. Meanwhile, Ventura County, located just northwest of Los Angeles, has even taken the unusual step of prepping a 250-page plan on how to respond to the humanitarian crisis that would result from a nuclear attack in Los Angeles.  In fact, their efforts even include this truly bizarre public service announcement that instructs folks to shelter in place and cover windows with plastic:

War with Iran or North Korea could involve deadly chemical weapons | TheHill -  Should the United States end up going to war with either Iran or North Korea, there is another concern from the Iraq war era that has not received much public attention: the possibility that former regime elements may use chemical or biological weapons or set off dirty or nuclear bombs against American and allied troops. Regime holdovers would have potent incentives to use such weapons should the military infrastructure of their respective states be decimated. Furthermore, they would have nothing to lose, as their wealth and influence is tied to the maintenance of the regime. If the regime falls, so do their livelihoods and grip on power. It is often noted that it is difficult to disperse chemical and biological weapons. While Bashar Assad’s use of chemical weapons in Syria is noticed, we don’t know how many times he’s attempted to launch chemical weapons attacks and failed. Two decades ago, we learned that the Aum Shinrikyo cult attempted multiple chemical weapons attacks in Japan only to be met with abysmal and embarrassing failures. Chemical and biological weapons are difficult to store and successfully disperse.Dirty bombs are a little different. Their main effect is psychological, with most immediate casualties coming from the initial blast itself. However, their longer term effects will linger, leaving radioactive particulates in the air for years and exposing both American troops and the general public to radiation. Given North Korea’s crossing of the nuclear rubicon, it’s not unthinkable for a dying regime to make a last stand with its nuclear arsenal.

Report: It's Tillerson vs. Haley Over Iranian Nuclear Deal -- Rex Tillerson and Nikki Haley are squaring off over the Iranian nuclear deal, with the secretary of state pushing President Donald Trump to remain in the accord while the U.N. ambassador fights for the president's agenda, The Washington Free Beacon reported.The president ran on a platform of ending what he calls the worst deal ever made, and earlier this week said it was an "embarrassment."Yet, Tillerson is urging Trump to keep the U.S. in the deal, stoking tensions with Haley."The tension between Rex and Nikki is the worst kept secret in the State Department," a foreign policy source told the Free Beacon.Haley "thinks that [Tillerson is] trying to undermine the president and preserve [former President Barack] Obama's Iran legacy, which is true," the source told the Free Beacon. "He thinks she's running her own foreign policy and auditioning for his job, which is also true."Tillerson is on the side of the international community urging Trump to stay in the accord; the restrictions on Iran, such as they are, are better than leaving them unchecked.Haley is on the side of the president and, ostensibly, conservatives in Congress who opposed Obama inking the pact in the first place.Haley on Wednesday said it will be Trump's "decision alone" while chastising Iran for not holding up its end of the bargain.Iran has "to stop smuggling arms, stop all the meddling they're doing in the Middle East, their support of terrorism," Haley said. Trump on Wednesday said he has decided without divulging what that is.

"We Will Not Seek Permission": Defiant Iran Unveils New Ballistic Missile -- Iranian President Hassan Rouhani delivered another snub to the Trump administration on Friday when he  said that Iran would continue its missile program in defiance of US sanctions, and to underscore the determination, the Iranian Revolutionary Guard unveiled its newest long-range ballistic missile during a military parade in Tehran. The new missile that was introduced at the parade is capable of reaching much of the Middle East, including Israel, with a range of 1,200 miles. It's also capable of carrying several warheads. The parade in Tehran commemorated the 1980s Iraq-Iran war. Though Iran has long boasted of having missiles in the same range in its arsenal, it was the first time that the new Khoramshahr missile was displayed in public, the AP reported adding that in February, Iran test-fired the same medium-range type of missile, prompting Trump to say that the United States is "putting Iran on notice." Friday's parade also showcased various Iranian army units and Revolutionary Guard forces, as well as the police, according to the Associated Press. Similar parades were held in other Iranian cities.Rouhani addressed the parade in Tehran, saying that Iran would not halt its missile program but continue to boost military capabilities, despite U.S. demands.“We will increase our military power as a deterrent. We will strengthen our missile capabilities ... We will not seek permission from anyone to defend our country.“All countries in the world supported the nuclear deal in the United Nations General Assembly this year ... except the United States and the Zionist regime (Israel),” Rouhani said. During his address to the general assembly earlier in the week, Rouhani slammed the US and Trump for reneging, and claimed that the Iran deal belongs “to the world” and “cannot be renegotiated.” He criticized Trump’s “ugly, ignorant words” made during Trump's own address where he urged world powers to come together and pressure the Iranian regime. Rouhani added that the country’s missile program is vital to national security, citing the country's long-running war with Iraq in the 1980s as justification for the program.

The U.S. Should Halt Arms Sales to the Saudi-Led Coalition -  American Conservative - The Qatar crisis continues to create friction inside the Trump administration: Tensions between the White House and the State Department over how to approach the ongoing dispute between the United States’ Gulf allies are reaching a boiling point, due to what the White House sees as Secretary of State Rex Tillerson’s stalling of large arms-sales packages President Trump agreed to in May. It is understandable that Tillerson wants to use arms sales as leverage in an attempt to pressure the Saudi-led bloc to compromise with Qatar. Trump is reportedly annoyed with this because it is interfering with the deals that he made, but then it was his green light to the Saudis that helped create the crisis in the first place. If Tillerson isn’t getting anywhere with the Saudi-led bloc, that is at least partly because Trump has repeatedly signaled that he is on the side of the bloc and approves of what they’re doing. Trump’s opposition to delays in the arms sales gives the members of the bloc another reason to assume that they can ignore any pressure coming from Tillerson. The misguided embrace of reckless clients and the administration’s foreign policy dysfunction are combining to make the U.S. completely ineffective in resolving the dispute. We can see in this story that Washington is more than capable of stopping arms sales to Gulf states when it wants to, and clearly both Tillerson and Senate Foreign Relations Committee chairman Bob Corker think that the U.S. can and should use these sales as leverage to change the behavior of the Saudis and other Gulf states some of the time. That makes their failure to halt arms sales to the Saudi-led coalition because of its conduct in Yemen all the more damning and inexcusable. Compared to what the coalition has done to Yemen with U.S. help, the treatment of Qatar has been nothing, but whenever there is a proposal to cut off the support that enables war crimes and humanitarian disaster many of the same people that are prepared to penalize the Saudis and UAE over Qatar are opposed to it even though it might save lives.

Bernie Sanders Slams "Terrorism-Funding" Saudi Arabia, "Not An Ally" Of The US  According to Bernie Sanders, Saudi Arabia has “funded terrorism” around the world and is “not an ally of the United States.”The United States has long considered Saudi Arabia to be a loyal friend, supporter, and partner in the so-called war on terror. Sanders issued a scathing denunciation of the Gulf kingdom, which has recently embarked on a new round of domestic repression.“I consider [Saudi Arabia] to be an undemocratic country that has supported terrorism around the world, it has funded terrorism... They are not an ally of the United States.”The Vermont senator accused the “incredibly anti-democratic” Saudis of“continuing to fund madrasas” and spreading “an extremely radical Wahhabi doctrine in many countries around the world.” “They are fomenting a lot of hatred,” he added.Speaking to The Intercept, Sanders called for a “rethink, in terms of American foreign policy … vis-a-vis Iran and Saudi Arabia.”The senator suggested the United States should consider a pivot toward long-standing adversary Iran and away from traditional ally Saudi Arabia.[Saudi Arabia] “has played a very bad role internationally, but we have sided with them time and time and time again, and yet Iran, which just held elections, Iran, whose young people really want to reach out to the West, we are... continuing to put them down.”

OUTRAGEOUS: Whiny Sen. Rand Paul tries ending the war in Afghanistan after only 16 years - Duffel Bag— Legislation introduced by Sen. Rand Paul (R-Ky.) failed to pass on Wednesday that would have effectively ended the war in Afghanistan and the bombing of at least six other countries, after Paul’s Senate colleagues voted it down because he’s a whiny little girl.Paul, who hates freedom and America generally, was seeking to put an end to the 2001 Authorization for the Use of Military Force, a law passed after the Sept. 11th attacks that allowed bombing of the terrorists responsible for it, the terrorists who hate the original terrorists, and Pakistani wedding parties.“All I’m saying is if you’re going to have a war, at least have a vote on it,” Paul told reporters, desperately trying to convince them to ‘hold lawmakers accountable.’ “But of course, it’s too much to expect Congress to do anything that doesn’t involve dinner with lobbyists.”In addition to his shameful forcing of the Senate to vote on whether to continue giving the president a blank check to drop Hellfire missiles on anyone he decides is a terrorist, Paul has in the past tried to force the National Security Agency to obtain a warrant before spying on American citizens.“His constituents should be ashamed,” Sen. Mitch McConnell (R-Ky.) said. Fortunately, 61 patriotic, freedom-loving members of the U.S. Senate voted against Paul’s liberal nonsense, including 13 Democrats.

Trump Warned Saudis Off Military Move on Qatar - Saudi Arabia and the United Arab Emirates considered military action in the early stages of their ongoing dispute with Qatar before Donald Trump called leaders of both countries and warned them to back off, according to two people familiar with the U.S. president’s discussions. The Saudis and U.A.E. were looking at ways to remove the Qatari regime, which they accused of sponsoring terrorism and cozying up to Iran, according to the people, who asked not to be identified because the discussions were confidential. Trump told Saudi and U.A.E. leaders that any military action would trigger a crisis across the Middle East that would only benefit the Iranians, one of the people said. More recently, the Trump administration has quietly sent high-level messages to Saudi Arabia and the U.A.E. to try to defuse the quarrel. Trump, who initially sided with the Saudi-led bloc, had a change of heart because of evidence that a prolonged dispute with Qatar will serve as an advantage to Iran, according to a U.S. official familiar with his thinking. Trump met with Qatar’s emir, Sheikh Tamim bin Hamad Al Thani, at the United Nations General Assembly in New York on Tuesday. Asked by a reporter if he had warned Saudi Arabia and the U.A.E. against military action in the country, Trump responded, “No.” At the same meeting, Trump confronted the Qatari leader with what one U.S. official said is evidence that Qatar is still engaged in terrorism-related activity and told him it has to stop. It wasn’t clear when the conversations on potential military action took place. The Saudis, backed by the U.A.E. and two other regional allies, broke off diplomatic ties with Qatar in early June, imposed an economic embargo and cut transport links. They’ve since issued multiple demands, including the closure of Qatar-based broadcaster Al Jazeera, that haven’t been met. Qatar denies all the accusations and accuses the Saudis of seeking to dominate smaller neighbors.

 Tillerson Says US May Close Cuban Embassy After Unexplained "Sonic Attacks"  -- On Friday we reported that more details have begun to emerge about the mysterious “sonic attacks” that have afflicted nearly two dozen American diplomats - and a handful of Canadians - serving in Havana. The US government has kept quiet, refusing to discuss potential suspects, or theories about how the attacks were carried out. Until now, as the Telegraph publishes new details about where the attacks occurred, as well as some insights into the government's thinking. The Cuban government has denied involvement in the incidents; however, the US abruptly and quietly expelled two Cuban diplomats from Washington last month, shortly before CBS ran its story, raising suspicions that the US was, in fact, looking into a Cuban government role. This was confirmed on Sunday, when Rex Tillerson said that the Trump administration is considering closing down the recently reopened U.S. Embassy in Havana following the "unexplained incidents harming the health of American diplomats in Cuba." Tillerson spoke on CBS' "Face the Nation" as world leaders and top diplomats descended on New York for annual U.N. General Assembly meetings. President Donald Trump will give his first speech on the major global platform this week.   A decision to shutter the embassy, even temporarily, would deal a demoralizing blow to the delicate detente that President Barack Obama and Cuban leader Raul Castro announced in late 2014. The next year, embassies were reopened and restrictions on travel and commerce eased, signs of a warming relationship that displeased some hard-liners in Cuba's government

 Kelly’s West Wing order leaves Navarro on the outskirts - Chief of staff John Kelly has been credited with bringing order to a chaotic West Wing. As a result, one close adviser has been increasingly sidelined and cut off from his once-regular access to the president: Peter Navarro.  Navarro, who leads the White House Office of Trade and Manufacturing Policy, has still managed to maintain a close personal relationship with President Donald Trump, whom he won over with his reputation as a warrior against open trade. Navarro “reinforces Trump’s world view on trade, which many do not,” Trump friend Roger Stone told POLITICO’s Tara Palmeri and Andrew Restuccia. “The president may be the only one in the building besides Navarro who really wants to renegotiate NAFTA. Everyone else thinks that’s a throwaway line from a campaign speech.”  Navarro’s pull with the president — and Kelly’s ability to contain his freewheeling style – will be put to the test as Trump makes crucial decisions on NAFTA, the Korea-U.S. free trade agreement, and tariff considerations on imports of steel, aluminum and solar panels.  “I get the sense that the president is tired of being told that he can’t do X,Y or Z in the trade space,” one White House official said. “I think he’s lost patience with it. I don’t see how the free trade camp in the West Wing can continue to put the brakes on this stuff. I think they’re going to have to choose what they want to prioritize.”

USTR considers non-binding dispute settlement mechanism in NAFTA -- The United States is considering dropping a binding mechanism in NAFTA for resolving government-to-government trade disputes in favor of a softer advisory system, sources following the talks told Morning Trade.The proposal, which would be a major shift away from a decades-old push by the U.S. to build an international system of enforceable trade rules, is already raising concern across the executive branch and on Capitol Hill. It was also one of several proposals that was sent to Congress this week for review ahead of the third round of formal NAFTA negotiations slated to begin this weekend, along with a “sunset provision” that would automatically terminate the deal after five years unless all three countries decide to renew it.The dispute settlement shift would also include a change to Chapter 11 of NAFTA, which allows private investors to sue member governments over actions that they believe unfairly discriminate against their investment. The proposal would allow countries to opt into the system, essentially making it voluntary.A USTR spokeswoman said late Wednesday they had no announcements to share at this time. But U.S. Trade Representative Robert Lighthizer himself spoke longingly of the previous non-binding system of dispute settlement earlier this week when he spoke at the Center for Strategic and International Studies.  "There was a system where you would bring panels and then you would have a negotiation," Lighthizer said, recalling his time as deputy USTR in the 1980s during the Reagan administration. "And, you know, trade grew and we resolved issues eventually. ... It’s a system that, you know, was successful for a long period of time."

US Trade Rep Outlines Expectations for NAFTA, WTO, EU Ties” -- US Trade Representative Robert Lighthizer told a Washington audience this week that trade watchers should “expect change, expect new approaches, and expect action” in the current Trump Administration’s policy plans going forward. Speaking at the Center for Strategic and International Studies on Monday 18 September, Lighthizer then answered questions on a host of topics, while repeatedly referring to the Trump Administration’s interest in negotiating bilateral trade deals, ensuring reciprocity in trading relationships, and addressing trade deficits.“I believe – and I think the president believes – that we must be proactive, that years of talking about these problems have not worked, and that we must use all instruments we have to make it expensive to engage in non-economic behaviour and to convince our trading partners to treat our workers, farmers, and ranchers fairly,” said Lighthizer.“We must demand reciprocity in home and in international markets,” he added, following this statement with the above-mentioned promise of change and action. Later on, when describing existing US trade agreements with other partners, he affirmed that one metric for judging their success would be the impact on trade deficits.“Where the numbers and other factors indicate a disequilibrium, one should renegotiate,” he said. He suggested that not only would it be more straightforward to clinch deals bilaterally, but that it would also be simpler to enforce their terms – while noting that the administration is still determining which countries to pursue such agreements which. “Usually in multilateral or plurilateral agreements it’s difficult to enforce the agreements because you’re disrupting too many things,” he said.

GOP senators closing in on tax cut plan - Top Republicans on a key Senate panel say they're moving closer to a tax plan that could add as much as $2 trillion to the government's $20 trillion debt over 10 years. Tennessee Sen. Bob Corker said Tuesday that Republicans have "potentially gotten to a very good place" on agreeing to how much the upcoming tax measure might cost. As Senate tax writers craft a package of tax rate cuts and curbs on some tax breaks, they hoping to reach a compromise between Senate GOP deficit hawks, who believe tax cuts must be offset by funds raised elsewhere, and "supply side" Republicans who believe any revenue shortfall can be made up through higher revenues generated by faster economic growth. Though talks have picked up this week, the tentative plan is still in its early stages. "We are still in the process of negotiating this," Iowa Sen. Charles Grassley told CNBC, who added that the White House and key congressional committees were still working on a "framework" for the tax plan. "I think we need that because we're going to have to operate within what can be signed by the president," said Grassley, who serves on the Budget and Finance committees. Corker, who serves on the Budget Committee, believes the plan should not increase the debt. "I'm all for pro-growth tax reform but over a decade it needs to pay for itself per valid models," he told The Associated Press. At a Finance Committee hearing on Tuesday, Sen. Ron Johnson, R-Wis., a proponent of tax cuts, said a 10-year, $1.5 trillion tax cut "ought to be a minimum." Much of the debate over any tax reform plan will rest on models used to generate estimates of the long-term costs to the government and impact on the economy. Central to the issue is a process known as "dynamic scoring," which attempts to estimate the impact of tax cuts on economic growth, and then capture that impact in the overall revenue forecast. That means that the method used to estimate the revenue and economic impact will be critical to the political success of any plan. 

Insanely Concentrated Wealth Is Strangling Our Prosperity - Steve Roth - Remember Smaug the dragon, in The Hobbit? He hoarded up a vast pile of wealth, and then he just hung out in his cave, sitting on it (with occasional forays to further pillage and immolate the local populace). That’s what you should think of when you consider the mind-boggling hoards of wealth that the very rich have amassed in America over the last forty years. The picture at right only shows the very tippy-top of the scale. In 1976 the richest people had $35 million each (in 2014 dollars). In 2014 they had $420 million each — a twelvefold increase. You can be sure it’s gotten even more extreme since then. These people could spend $20 million every year and they’d still just keep getting richer, forever, even if they did absolutely nothing except choose some index funds, watch their balances grow, and shop for a new yacht for their eight-year-old.If you’re thinking that they “deserve” all that wealth, and all that income just for owning stuff, because they’re “makers,” think again: between 50% and 70% of U.S. household wealth is “earned” the old-fashioned way (cue John Houseman voice): it’s inherited.The bottom 90% of Americans aren’t even visible on this chart — and it’s a very tall chart. The scale of wealth inequality in America today makes our crazy levels of income inequality (which have also expanded vastly) look like a Marxist utopia. American households’ total wealth is about $95 trillion. That’s more than three-quarters of a million dollars for every American household. But roughly 50% of households have zero or negative wealth. But here’s what’s even more egregious: that concentrated wealth is strangling our economy, our economic growth, our national prosperity. Wealth concentration drives a vicious, downward cycle, throttling the very engine of wealth creation itself.

 Why American Workers Pay Twice as Much in Taxes as Wealthy Investors - The first line asks filers to write down their previous year’s wages.   The second line asks filers to add just half of their investment income.   The form’s simplicity makes its priorities clear: No matter what rates are applied or which deductions or credits are allowed, a worker would end up paying twice as much in taxes as an investor with the same income. Americans in the top 1 percent, and especially the top 0.1 percent, have seen their wealth and income multiply in recent decades as the rest of the country’s share of the economic pie shrank. Since 2000, a recent study found, the top 1 percent have made those gains almost entirely on income from capital, especially corporate stock—not on labor income. One reason may be the financial options of the wealthy: Business owners can lower their tax bills by paying themselves in dividends rather than in salary, for example. Meanwhile, the U.S. Treasury is expected to run a 2017 deficit of $693 billion, according to the Congressional Budget Office’s latest estimate, some $108 billion more than in the 2016 fiscal year. As baby boomers retire and health-care costs rise over the next few decades, the government’s fiscal situation is expected to worsen. The argument in favor of lower taxes on investors—and on corporations, another GOP priority—is an economic one. “We want a tax code built for growth,” Speaker Ryan said. “We want a tax code that raises wages, keeps American companies in America, gives us faster economic growth.  Congress are wrangling over a variety of competing goals for reform. The most aspirational is a tectonic simplification of the tax code that really would allow everyone to file using a postcard. But more realistic legislative targets are lowering tax rates on individuals and corporations as well as eliminating the estate tax and alternative minimum tax. They may also try again to kill the Affordable Care Act taxes—including those on all that investment income raked in by the wealthy.

One-Tenth Of Global GDP Is Now Held In Offshore Tax Havens -- In a first-of-its kind study from the National Bureau of Economic Research, a team of economists has broken down rates of offshore wealth holdings as a percentage of GDP to identify countries with the largest, and smallest, percentages of wealth held offshore. The study’s conclusion suggests a reality that many readers probably suspected: the true scope of wealth inequality is far larger than the official statistics would suggest. The study found that as much as one-tenth of the world’s GDP is held in tax havens, though that percentage can vary widely from country to country.  Here's Bloomberg: “One-tenth of the world’s GDP is held in offshore tax havens, but that share jumps to as much of 15 percent for Europe and as much as 60 percent for Gulf and some Latin American countries, new research shows. When it comes to total offshore wealth as a share of GDP, the United Arab Emirates, Venezuela, Saudi Arabia, Russia and Argentina lead the pack, while Germany, the U.K. and France all have above-average holdings. The U.S. is slightly below average.” Unsurprisingly, the countries with the largest offshore wealth holdings as a percentage of GDP are oil rich, with much of that wealth flowing through state-run companies. But some G-10 economies – notably in Europe – also have a larger than average percentage of wealth tied up offshore. “When it comes to total offshore wealth as a share of GDP, the United Arab Emirates, Venezuela, Saudi Arabia, Russia and Argentina lead the pack, while Germany, the U.K. and France all have above-average holdings. The U.S. is slightly below average.”

 The Medicare for All Act of 2017: The Politics - naked capitalism by Lambert Strether - I wouldn’t have imagined two or even one year ago that Senator Bernie Sanders would introduce a Medicare for All Bill with sixteen co-sponsors (highlighted below).  In this post, I’ll look briefly — and probably simplistically, because I’m gobsmacked — at the politics of the “Medicare for All Act of 2017” (“BernieCare,” as I suppose we must call it). First, I’ll look at the co-sponsors; then, I’ll look at the coverage, and lastly, I’ll look at funding. First, I looked at the co-sponsors of the bill, to see if they had, as we say, “skin in the game.” In one important sense, they do. From MapLight: Democratic senators who haven’t signed on to Sen. Bernie Sanders’ “Medicare for All” proposal have received twice as much cash from the insurance industry as the bill’s sponsors, MapLight has found. The insurance industry has donated an average of $23,600 since 2010 to senators who have co-sponsored Sanders’ bill, according to a MapLight review of campaign finance data compiled by the Center for Responsive Politics. Democratic senators who have not yet supported his legislation, including Sen. Angus King, a Maine independent, have received an average of $55,500 from the industry. So, the 16 co-sponsors are leaving money on the table. Moreover, they’re risking the insurance companies (and perhaps health care trade associations, and Big Pharma) funding their opponents. The co-sponsors are indeed taking a risk. But how big a risk? Consider the following table:From the table, we can see that only one Senator — Tammy Baldwin — is putting her “Leans Democrat” seat at risk by endorsing BernieCare; all the Senators either have safe seats, or are not up for election in 2018 at all. We can also see a gaggle of Democrat liberals in safe seats — looking at you, DiFi! — who don’t support BernieCare, presumably because markets. And we can see some leans in the Swing States, especially Sherrod Brown, who may perhaps doubt their ability to sell the bill (oddly).

The Medicare for All Act of 2017: The Policies -  Lambert Strether - Yesterday, I wrote on the politics of The Medicare for All Act of 2017 (“BernieCare”). Today, I’ll write on the policies. First, I’ll lay out, very sketchily, one or two differences between BernieCare and HR676 (“ConyersCare”) — as opposed, of course, to #LiberalsDontCare — which will have to serve as a placeholder for the full-throttle War and Peace-length post I should and will write on this topic[1]. Then, I’ll consider the health insurance industry workers that #MedicareForAll would displace. Finally, I’ll look at the fiscal issues (or rather, how to think about them). Spoiler alert: I’ll treat worker displacement and budget issues at a very high, talking-point level; it would be nice if some good faith wonks got down in the weeds on these topics but (with the exception of Gerald Friedman) they haven’t yet.  Again, I want to express my gobsmackedness at having not one, but two #MedicareForAll bills introduced in Congress, both with a serious number of co-sponsors[1]; we have come a long way from the days of 2009, when Max Baucus refused to include single payer advocates in his hearing, and had them arrested when they protested; or when Obama sneered at “little single payer advocates.” It just goes to show that good things can happen in one’s own lifetime, which really matters to an old codger like me. Here are two comparisons of BernieCare and ConyersCare. The first is a list from Dr. Margaret Flowers and the HOPE campaign, in mail; the second is a table from Health Over Profit. The first cites to the second.

The Best Health Care System? Doctors Back Single-Payer -- Doctors have come out overwhelmingly in support of a single-payer health care system, a new study shows. Forty-two percent of doctors support the type of federal insurance system currently being championed by Vermont Senator Bernie Sanders, according to pollster Merrit Hawkins. Another 14 percent of physicians were “somewhat supportive,” but only 33 percent “strongly opposes” the single-payer system and six percent was somewhat against it. In the same study from 2008, 42 percent of doctors strongly or mildly supported single-payer—a swing of 14 percentage points. And the percentage that strongly or mildly opposed single-payer has dropped 19 percent. The doctors are part of an overall trend in support of the so-called “Medicare for All” approach. Overall, 33 percent of Americans now favor the single-payer system, up 5 percentage points since January and up 12 percent since 2014, a Pew Research Center study shows. Politicians are also reading the tea leaves: Senators Elizabeth Warren (D-Mass.), Cory Booker (D-N.J.) and Jeff Merkley (D-Ore.) have signed onto a bill by Sanders to create a single-payer system that would make the federal government the nation’s health care insurer. There are many reasons Americans increasingly favor single payer. First, it’s generational. According to both the Pew Research Center’s poll and the survey from Merrit Hawkins, support for a single-payer health insurance is much greater among younger adults and doctors than older adults. And with older doctors retiring and young doctors starting to practice, there is less resistance to single-payer. Doctors added that a single-payer health care system helps them focus on their actual job and spend more time caring for patients and less time navigating the existing insurance-based system, according to Merritt Hawkins. “Doctors are constantly seeing patients that have health problems that they can’t address because of their insurance,” said Dr. Ed Weisbart of Physicians for a National Health Program, an organization that advocates for single payer. “There are so many people without insurance, and that has improved, but the quality of [their] insurance is getting worse and worse.”   Doctors, he added, are “fed up” with the current system.

Even Business Leaders Are Realizing Health Insurance Companies Serve No Purpose - Polls show a growing number of Americans are warming up to the idea of single-payer health care. Whether that's a reaction to the repeal-and-replace bills proposed by congressional Republicans or to the failure of the Affordable Care Act to get us to universal coverage (or even reduce medical costs in a meaningful way) is largely irrelevant. What is relevant is that most of us have lost faith in private health insurers and want the government to do more in health care.  In fact, according to a June 2017 poll by the Pew Research Center, 60 percent of those surveyed said the federal government has the responsibility to provide coverage to all Americans. We've seen similar poll results in years past. What is different and significant this time, though, is that US business leaders are among those questioning our multi-payer system and embracing a system with just one payer, the government. That shift could prove to be the game changer that moves single-payer health care from what many pundits and politicians have considered a pipe dream to a very real possibility.None other than Berkshire Hathaway chair and CEO Warren Buffett has joined the single-payer movement, as has Berkshire Hathaway's Republican vice chair, Charlie Munger. Buffett told PBS NewsHour in June that a single-payer system "probably is the best system" because it could do a better job of controlling ever-rising health care costs. A month earlier, he told Berkshire Hathaway shareholders that medical costs are "the tapeworm of American economic competitiveness." In a Yahoo Finance interview, Munger cited the "massive amounts of excess cost" in the current US health care system -- which he described as a "Rube Goldberg system that arose by accident" -- as his reason for supporting single-payer health care.

Fool Me Twice: Trojan Horse Democrats Pile Into the House of Single-Payer - It’s great that more than a third of Democratic senators have signed on to co-sponsor Bernie Sanders’s Medicare-for-All bill. It’s a potentially strong bill that’s been welcomed by single-payer activist organizations like Physicians for a National Health Program (PNHP) and National Nurses United (NNU), and it represents a victory for the tireless work of single-payer activists and the popular pressure they stoked. It is also, we must recognize, only possible because of Bernie’s insistent promotion of healthcare as a right, in a campaign that widened the field of American political discourse.Above all, it is a result of continuing disgust with American for-profit health insurance system. It marks the exasperation with Obamacare’s half-assed attempt to patch up that system, and the rejection of the even crueler Republican schemes.At the very least, this bill puts single-payer “on the table” of legislative action and public discussion. The “public discussion” part is perhaps the most important. People will now hear about single-payer, and its advocates will not be completely shut out of media coverage from Fox to PBS, as they are now. Even the Democratic Party will have to talk about it. But please, please, do not be fooled. It does not mean that most, or any, of those co-sponsoring Democratic senators actually support single-payer. Most of those Democrats have signed on because they felt politically forced to, because they knew they could not face their constituents if they didn’t. But many of them do not support single-payer, have no intention of actually working to make it happen, and will, in fact, do their best to undermine and prevent it.

Does Single Payer Pay for Itself? - Was this the message of the title of the latest from Dean Baker:The economies of a single system can be viewed as analogous to the Social Security system, which has administrative costs that are less than 1/20th as much as privatized systems in places like Chile and the United Kingdom. The analogous institution in the health-care sector is of course Medicare, which has administrative costs of less than 2 percent of benefits in the traditional fee-for-service portion of the program, roughly a tenth the cost for private insurers. I will agree that the 20% gross margins received by the health insurance companies are obscene. This margin breaks down into a 14% operating expense to premium revenue ratio and a 6% operating margin. I would imagine competition could cut the former in half and the latter by a factor of two-thirds. I’m suggesting a 2% operating margin is reasonable as the reserve to premium revenue ratio is close to 25% for health insurance and an 8% cost of capital is more than reasonable. But Dean is arguing that we can live on a 1% gross margin, which seems to be very ambitious. OK- governments might be able to lower the cost of capital but nearly eliminating administrative costs sounds incredible. But the point of this discussion is to question the latest from Kenneth Thorpe: Professor Kenneth Thorpe recently issued an analysis of Senator Bernie Sanders’ single-payer national health insurance proposal. Thorpe, an Emory University professor who served in the Clinton administration, claims the single-payer plan would break the bank. Thorpe’s analysis rests on several incorrect, and occasionally outlandish, assumptions. Moreover, it is at odds with analyses of the costs of single-payer programs that he produced in the past, which projected large savings from such reform

Single Payer Myths: Redundant Health Administration Workers -- One of the reasons why the current US health care system is so bloated is that it wastes a lot of labor on health insurance administration. Health care providers have to employ many people to make agreements with health insurers and to bill health insurers. Health insurance companies also have to employ many people to make agreements with health care providers and to pay the bills those providers send them. By streamlining billing and payments under a single national insurer, a single payer system would eliminate much of this work, which is one of its many charms. Critics argue that the elimination of this work would strike an intolerable blow to employment in the country. In reality, the loss of employment would be relatively small compared to the overall economy, should only be temporary, and can be cushioned through unemployment benefits and active labor market policies that help reallocate redundant workers into new jobs. One of the reasons for the pervasiveness of this myth is a lack of understanding of just how many people get separated from their job already every year.In 2016, 60 million people separated from their job at some point during the year. That is equal to 42 percent of the American workforce. Of course, there is a difference between quitting a job (often for another job already in waiting) and being fired from a job. But if you look only at layoffs and discharges (grouped in the above graph as “dismissals”), you see that, in 2016, 20 million people were fired from their job, representing around 14 percent of the total US workforce. Being fired from a job without having another job waiting can be a very bad experience, but it is also a very common experience that does not generally have long-term negative economic consequences.

CBO Sees Slow Growth For Exchanges; Administration Promotes Agents And Brokers In Marketplaces - On September 14, 2017, the Congressional Budget Office issued its annual report on Federal Subsidies for Health Insurance Coverage for People Under Age 65: 2017 to 2027. The CBO and Joint Committee on Taxation (JCT) estimate that in 2017, the federal subsidies, taxes, and penalties associated with health insurance coverage for people under age 65 will result in a net federal subsidy of $705 billion, about 3.7 percent of the gross domestic product (GDP). This amount is projected to rise to $1.2 trillion, or 4.1 percent of GDP by 2027.About 244 million noninstitutionalized civilians under age 65 have health insurance. Of these, about 156 million have employer coverage, 63 million Medicaid or CHIP, 17 million nongroup market coverage (with 8 million subsidized and 2 million unsubsidized through the exchanges), and 8 million Medicare. A total of 28 million are uninsured. Federal subsidies for people under age 65 in 2017 amounted to $287 billion for employment-related coverage, $296 billion for Medicaid, $89 billion for Medicare, and $45 billion for Affordable Care Act premium tax credits, cost-sharing reduction payments, and Basic Health Plan subsidies. The CBO projects that the individual mandate penalty will only yield $3 billion in revenue for 2017 because a “substantial majority” of the uninsured are not subject to it.The CBO expects the nongroup market to be stable for 2018. It expects premiums to rise by about 15 percent for 2018 because of short-term uncertainty about the cost-sharing reduction payments but thereafter to rise at about 5 percent a year, and perhaps even to decrease for 2019. The CBO expects the number of people covered by employers to decrease by about 5 million by 2017, reflecting a long-term decline in employer coverage and some employers moving their employees to Medicaid or the nongroup market. The CBO expects Medicaid coverage to grow to 70 million over the next decade. About 17 million of these would have ACA Medicaid expansion coverage, up from 13 million today. The CBO expects that some states will still expand Medicaid in the future, although the current uncertainty about the program makes expansions in the near term unlikely. The CBO expects exchange enrollment to continue to grow, but slowly. About 10 million will be covered this year, about 11 million in 2018, and 12 million for succeeding years.  The CBO does not expect exchange enrollment to grow in the short run because of premium increases as the Trump administration cuts advertising and outreach, and uncertainty continues about cost-sharing reduction payments and individual mandate enforcement.

Don't Look Now, But Full Obamacare Repeal Is Back On The Table | HuffPost: Repeal of the Affordable Care Act is back on the agenda, with Republicans suddenly talking about a bill that, until recently, few people in either party had taken all that seriously.The prospects for the new legislation are murky. The proposal has generated a ton of conversation in political and health policy circles in just the past week, with multiple outlets reporting that leadership is now thinking about floor action before Sept. 30. That’s the magic date when, because of parliamentary rules, Republicans lose their ability to pass repeal with just 50 votes. But much of the chatter is hype from supporters and it’s hard to know how much enthusiasm for the proposal actually exists.Still, even if the bill’s political fortunes are difficult to pin down, the impact it would have as a law is crystal clear. By dramatically scaling back what the federal government spends on health care and undermining rules designed to guarantee insurance for people with pre-existing conditions, this new proposal would leave millions of Americans struggling to pay their medical bills and to get coverage.It is, in other words, another shot at full repeal, although its GOP sponsors sometimes suggest otherwise ― and that’s one reason it has escaped heavy scrutiny until now. Those sponsors are Bill Cassidy of Louisiana and Lindsey Graham of South Carolina ― an unlikely duo, perhaps, given some of their previous statements about repeal.

Senate GOP tries one last time to repeal Obamacare - POLITICO: Obamacare repeal is on the brink of coming back from the dead. Senate Majority Leader Mitch McConnell (R-Ky.) and his leadership team are seriously considering voting on a bill that would scale back the federal government’s role in the health care system and instead provide block grants to states, congressional and Trump administration sources said. would be a last-ditch attempt to repeal Obamacare before the GOP’s power to pass health care legislation through a party-line vote in the Senate expires on Sept. 30. No final decision has been made, but the GOP leader has told his caucus that if the bill written by Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.) has the support of at least 50 of the 52 GOP senators, he will bring it to the floor, Graham and Cassidy say. That would give Republicans one more crack at repealing the Affordable Care Act, a longtime party pledge. Right now, support for the bill — which would replace Obamacare’s tax subsidies with block grants, end the law’s individual insurance mandate and scale back its Medicaid expansion — among Republican senators is short of 50 votes. But McConnell and his lieutenants will gauge support this week in private party meetings with help from President Donald Trump, administration and Capitol Hill sources said. “McConnell and his team are engaged and serious about the vote and working with the conference to build support for Graham-Cassidy,” a source familiar with the bill’s prospects said Sunday. The “White House is also operating with all hands on deck.” White House officials began making calls last week to Republican Senate offices and plan to whip Senate votes this week, an administration official said. Supporters of the Graham-Cassidy bill have tried to keep their efforts to round up votes quiet so far, this official said, but the push is ramping up. 

Like Other ACA Repeal Bills, Cassidy-Graham Plan Would Add Millions to Uninsured, Destabilize Individual Market - CBPP -   In releasing a revised version of their legislation to repeal and replace the Affordable Care Act (ACA), Senators Bill Cassidy and Lindsey Graham, along with co-sponsors Dean Heller and Ron Johnson, claimed that their bill isn’t a “partisan” approach and doesn’t include “draconian cuts.” In reality, however, the Cassidy-Graham bill would have the same harmful consequences as those prior bills. It would cause many millions of people to lose coverage, radically restructure and deeply cut Medicaid, eliminate or weaken protections for people with pre-existing conditions, and increase out-of-pocket costs for individual market consumers. Cassidy-Graham would:

  • Eliminate the ACA’s marketplace subsidies and enhanced matching rate for the Medicaid expansion and replace them with an inadequate block grant. Block grant funding would be well below current law federal funding for coverage, would not adjust based on need, would disappear altogether after 2026, and could be spent on virtually any health care purpose, with no requirement to offer low- and moderate-income people coverage or financial assistance.
  • Convert Medicaid’s current federal-state financial partnership to a per capita cap, which would cap and cut federal Medicaid per-beneficiary funding for seniors, people with disabilities, and families with children.
  • Eliminate or weaken protections for people with pre-existing conditions by allowing states to waive the ACA’s prohibition against charging higher premiums based on health status and the requirement that insurers cover essential health benefits including mental health, substance abuse treatment, and maternity care. 
  • Destabilize the individual insurance market in the short run — by eliminating the ACA’s federal subsidies to purchase individual market coverage and eliminating the ACA’s individual mandate to have insurance or pay a penalty —and risk collapse of the individual market in the long run.
  • Eventually result in larger coverage losses than under proposals to repeal ACA’s major coverage provisions without replacement.  The Congressional Budget Office (CBO) has previously estimated that repeal-without-replace would cause 32 million people to lose coverage.  The Cassidy-Graham bill would likely lead to greater numbers of uninsured after 2026, however, because it would not only entirely eliminate its block grant funding — effectively repealing the ACA’s major coverage expansions — but also make increasingly severe federal funding cuts to the rest of the Medicaid program (outside of the expansion) under its per capita cap.

By attempting to push this bill forward now, Senators Cassidy and Graham are reverting to a damaging, partisan approach to repealing the ACA that would reverse the historic coverage gains under health reform and end Medicaid as we know it — even as other members of Congress, with the help of governors and insurance commissioners of both parties, are making progress in crafting bipartisan legislation to strengthen the individual market.

Congress Enters Legal Fight to Block Release of Obamacare Repeal Emails – In a highly unusual move on Friday evening, Congress forced itself into the legal battle over the release of emails detailing the closed-door Obamacare repeal negotiations – arguing that a set of emails between the Trump administration and the House Ways and Means Committee should be kept secret. The Motion to Intervene filed by the House Ways and Means Committee, with the support of the Republican and Democratic leaders of the House, argues that several emails between the committee and the Department of Health and Human Services (HHS) should not be released to the public under the Freedom of Information Act (FOIA). “In a rare moment of bipartisanship, House leaders came together late on a Friday night to block the American people from learning the truth about the Obamacare repeal effort,” said Austin Evers, Executive Director of nonpartisan ethics watchdog American Oversight. “From the very beginning, health care negotiations between the Trump administration and Congress have taken place in secret, and with talks reportedly starting again, Congress has made it clear that its first priority is to keep the public in the dark.” American Oversight filed a Freedom of Information Act (FOIA) lawsuit against HHS and OMB in May to force the release of communications with Congress from the initial round of health care negotiations that took place earlier this year. A federal judge ordered the agencies to produce the requested records, and on September 5, HHS and OMB finished releasing over seven thousand pages of heavily redacted emails and calendar entries. Friday night’s move by the Ways and Means Committee to intervene in American Oversight’s lawsuit represents a significant escalation in Congress’s efforts to shield the Trump administration from public scrutiny. Earlier this year, the House Financial Services Committee instructed twelve executive branch agencies to withhold any emails with the committee when responding to FOIA requests. Ways and Means sent similar instructions to at least one agency as well. American Oversight has filed a separate lawsuit challenging the Financial Services Committee’s attempt to restrict public access to information. Under the FOIA, communications between federal agencies and Congress generally cannot be withheld from public release.

 Rand Paul says can't support last-ditch GOP ObamaCare repeal - Sen. Rand Paul (R-Ky.) said he can’t support the newest ObamaCare repeal plan a quartet of senators is pushing, highlighting the hurdles the legislation would need to overcome to pass the upper chamber.Paul called the legislation “Obamacare Lite.”I can't support a bill that keeps 90% of Obamacare in place. #GrahamCassidy is not repeal or replace, it is more Obamacare Lite — Senator Rand Paul (@RandPaul) September 15, 2017    GOP Sens. Bill Cassidy (La.), Lindsey Graham (S.C.), Dean Heller (Nev.) and Ron Johnson (Wis.) released the legislation on Wednesday. The bill would move money for ObamaCare's Medicaid expansion, tax credits and cost-sharing reduction subsidies to block grants to the states. It would also repeal the individual and employer mandates and the medical device tax. On Friday morning, Cassidy told reporters that he was “pretty confident we’ll get there on the Republican side. We’re probably at 48-49 [votes] and talking to two or three more.”The bill would have to surmount some tough hurdles in order to pass the Senate. The fast-track vehicle the GOP was using to repeal ObamaCare, since it avoided a Democratic filibuster, expires at the end of the month.Additionally, the legislation could only afford to lose two GOP votes — assuming Vice President Pence swoops in to break a tie — and Paul is already a hard no. On Monday, Paul told reporters the proposal would “probably” be worse than doing nothing about the health law. Over the summer, Paul was critical of GOP leadership’s repeal-and-replace bill, advocating for a clean repeal of ObamaCare instead.

Senate GOP Has 12 Days to Repeal Obamacare and No Room for Error  -- Senate Republicans making one last-ditch effort to repeal Obamacare have the daunting task of assembling 50 votes for an emotionally charged bill with limited details on how it would work, what it would cost and how it would affect health coverage -- all in 12 days. President Donald Trump’s administration is starting to throw its weight behind the bill. Vice President Mike Pence plans to meet privately with Senate Republicans Tuesday and said on Air Force Two that he plans to tell them "this is the moment. Now is the time. We have 12 days." He said he’ll make it clear that the House won’t support a separate effort to shore up Obamacare. The Senate needs to act by Sept. 30 to use a fast-track procedure that prevents Democrats from blocking the proposal, but the deadline doesn’t leave enough time to get a full analysis of the bill’s effects from the Congressional Budget Office. The measure would face parliamentary challenges that could force leaders to strip out provisions favored by conservatives. Several Republicans are still withholding their support or rejecting it outright. And even if Republicans manage to get it through the Senate by Sept. 30, the House would have to accept it without changing a single comma. 

Republicans Really Could Repeal Obamacare This Time -- Republicans are only a handful of votes short in the party’s latest attempt to repeal the Affordable Care Act. And one of the key “no” votes from July, Sen. John McCain of Arizona, could flip to “yes,” since Arizona Gov. Doug Ducey has endorsed this latest repeal legislation. (McCain has suggested he would be more likely to vote for a Ducey-backed bill.) But there are not yet 50 Republicans publicly backing the newest Obamacare repeal bill, known as Graham-Cassidy. And the GOP has always been a handful of votes short. What’s surprising about the potential passage of this legislation is that it is in some ways more conservative than the bill that almost passed in July. Written by Sens. Bill Cassidy (Louisiana), Lindsey Graham (South Carolina), Dean Heller (Nevada) and Ron Johnson (Wisconsin), the legislation — unlike previous Obamacare repeal proposals — gives a lot of power to states to set their own health care policies. Before we get to how likely it is to pass, here are some of its policy highlights (I borrowed from analyses from the website Health Affairs by Washington and Lee University’s Timothy Jost and George Washington University’s Sara Rosenbaum):

  • Obamacare’s tax revenue — instead of paying for subsidies and tax credits to individuals and extra Medicaid funding — would go toward block grants for each state.
  • The total amount of money going to states will likely be less than if Obamacare stayed in place, according to an analysis by the left-leaning Center on Budget and Policy Priorities.
  • In effect, this legislation would take the money that goes to the 31 states that expanded Medicaid under Obamacare and spread it to 50.1 So California would likely end up with tens of billions of dollars less, but Texas (which did not expand Medicaid) much more.
  • A state could require everyone to have health insurance and subsidize private insurance targeted at low-income people, like Obamacare. But a conservative state could create a system with few regulations, even allowing insurance companies to set higher prices for people with pre-existing conditions. (Graham-Cassidy only explicitly bars setting higher rates based on gender or race.)
  • There would be a cap on national spending on Medicaid outside of Obamacare, likely leading to the kind of cuts to the program that were estimated under previous GOP efforts at Obamacare repeal.

Obamacare Could Die - We are at this very odd moment now. We thought ACA was saved by a narrow vote some months ago, when John McCain joined Susan Collins and Lisa Murkowski to block the last version of Trumpcare. Whew! No need to worry about millions of people having their health insurance taken away! Time to start pushing for single payer, Medicare for all, hah hah! But, ooops! So here we are with only 12 days to go before the window in which the US Senate can pass a repeal and replace of ACA using budget resolution, and thus with only a majority vote. But, hey, here we have Cassidy-Graham, which would turn the whole thing into block grants to the states, allowing them to allow insurance companies to charge more for preexisting conditions and pretty much get rid of all those things people have liked about ACA once they began to realize that it might disappear. But now hardly anybody is aware of what is going down at all, with near zero media attention, since we all moved on to Korea and DACA and whatever.. But this stealth Cassidy-Graham bill could very well pass. It looks like Collinis and Murkowski will again vote no, realizing that it slashes the Medicaid expansion, among other things, and would kill insurance for many people in their states who currently have health insurance thanks to ACA. But one of the co-sponsors, Lindsey Graham of SC, is John McCain’s closest ally and friend in the Senate, maybe in all of Washington now. Reports have it that McCain is in fact thinking seriously of voting for this bill, which most reports say is actually worse than what got shot down previously by McCain’s swing vote. The only other reported possible negative vote is Rand Paul, who is claiming this bill still contains too much of ACA, but he voted for the “slim repeal” after similar complaining last time. He could easily vote for this. The hard bottom line is that we could wake up in a week or so with this awful bill passed, ready to whiz through the House for Trump to sign, and Obamacare dead after all, with millions set to lose their insurance, with barely anybody even knowing what is up. This is a seriously bad business. 

New health-care plan stumbles under opposition from governors - WaPo - Senate Republicans and the White House pressed ahead Tuesday with their suddenly resurgent effort to undo former president Barack Obama’s signature health-care law, even as their attempt was dealt a setback when a bipartisan group of governors and several influential interest groups came out against the proposal. Powerful health-care groups continued to rail against the bill, including AARP and the American Hospital Association, both of which urged a no vote. But it was unclear whether the opposition would ultimately derail the attempt, as key Republican senators including Lisa Murkowski of Alaska said they had yet to make up their minds. The measure marks the last gasp of Republican attempts to dramatically gut Obama’s Affordable Care Act, which has added millions of people to the ranks of the insured through a combination of federally subsidized marketplaces and state-level expansions of Medicaid, leading to record lows in the number of those without health insurance. The Graham-Cassidy bill — named for Sens. Lindsey O. Graham (S.C.) and Bill Cassidy (La.) — would convert funding for the ACA into block grants for the states and would cut Medicaid dramatically over time. The bill — coming two months after a previous failed repeal effort in the Senate — is the subject of a last-ditch lobbying push by Senate Majority Leader Mitch McConnell (R-Ky.) and the Trump administration, led by Vice President Pence, ahead of a Sept. 30 deadline for Senate action. In a letter to Senate leaders, the group of 10 governors argued against the Graham-Cassidy bill and wrote that they prefer the bipartisan push to stabilize the insurance marketplaces that Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) had been negotiating before talks stalled Tuesday evening. Sen. Charles E. Schumer (D-N.Y.) attacked the latest GOP health-care plan, the Graham-Cassidy proposal, on Sept. 19 as 10 governors came out against it. "Millions will lose coverage," Schumer said. (The Washington Post) The governors who signed the letter are particularly notable, since some are from states represented by Republican senators who are weighing whether to back the bill. Among the signers were Alaska Gov. Bill Walker (I), who holds some sway over Murkowski, a potentially decisive vote who opposed a previous Republican effort to repeal and replace the Affordable Care Act. 

 Trump Embraces Senate GOP Health Bill - President Donald Trump on Wednesday urged Republican senators to support a last-ditch proposal to repeal Obamacare after Majority Leader Mitch McConnell refused to promise a vote on the measure.“I hope Republican Senators will vote for Graham-Cassidy and fulfill their promise to Repeal & Replace ObamaCare. Money direct to States!” Trump tweeted. He also knocked Senator Rand Paul, a Kentucky Republican, for holding out on the plan, authored by colleagues Lindsey Graham of South Carolina and Bill Cassidy of Louisiana.Democrats and other opponents started ramping up a new campaign Tuesday to block the measure. Amid doubts about whether it has enough Republican support ahead of a key procedural deadline on Sept. 30, McConnell stopped short of committing to hold a vote -- and risking another embarrassing floor defeat like the last repeal bill suffered in July.“If we were going to go forward, we would have to act before Sept. 30,” McConnell told reporters Tuesday when asked if the bill will come to the Senate floor before the deadline. “We are in the process of discussing all of this.” “It’s better than the status quo by far, and that’s an argument we’re all comfortable making,” McConnell said.

This unique, terrible, phony, fraught-with-lies moment in American politics -- Jared Bernstein - This will be brief, because a note about how the political debate is misleading isn’t exactly breaking news or even, admittedly, that interesting. So, I’d consider it a personal favor if you’ll allow me to vent for a moment.It’s just that the extent to which we’re being lied to right now seems, to me at least, uniquely over the top. The transparency of the BS is just so obvious, especially on Cassidy-Graham, the just-as-bad-as-all-the-others repeal and replace bill that may get a vote in the Senate next week.Same with the tax “plan.” Even though there is no real plan yet, what we’ve seen so far is mostly tax cuts for wealthy businesses and corporations, the cost of which will get loaded onto the deficit. Yet its proponents are selling it as a pro-growth package that lifts the working class.My CBPP colleagues have been hammering on how C-G is just as much a wolf as past R repeal bills, despite its sheep’s clothing. It cuts health care spending on ACA functions by over $200 billion, 2020-26, and much more in later years (a new study by the health analysis firm Avalere comes up with similar numbers; see their table below) and that doesn’t count cuts to the traditional Medicaid program, which under C-G is no longer guaranteed to expand to meet the health needs of low-income recipients. Under C-G: “Faced with a recession…states would have to either dramatically increase their own spending on health care or, as is far more likely, deny help to people losing their jobs and their health insurance.”But, because there’s no CBO score, supporters of the bill claim that these reductions in resources won’t lead to less coverage. How? For that, you need to read this jaw-dropping set of interviews from the Onion Vox. The enterprising Jeff Stein asked 9 R senators why C-G made sense in policy terms, and remarkably, they (sort of) responded. But oy, what responses! Just a rotting bag of wilted word salad.

AARP: Older Americans to pay $16K more under GOP ObamaCare repeal -- A new study from the AARP finds that older people could pay as much as $16,174 more per year for health coverage under the Republican bill to repeal ObamaCare known as Graham-Cassidy. The bill “threatens to make health care unaffordable and inaccessible for millions of older Americans,” AARP, which opposes the measure, writes in the report. The study finds that on average nationwide, a 60-year-old making $25,000 per year would have to pay as much as $16,174 more per year for health insurance. That is a result of the possible elimination of two kinds of ObamaCare subsidies, which help people afford their premiums and out of pocket costs. The bill gives states wide leeway on how they spend a new block grant under the bill, so it is possible that some states could keep some of this subsidy funding, which would lessen the increase in costs. The study singles out certain states as having even higher potential cost increases than the national average. In particular AARP points to Alaska, home to Sen. Lisa Murkowski, a key vote, and Arizona, home to Sen. John McCain, another crucial vote. A 60-year-old making $25,000 per year in Alaska would have to pay as much as $31,790 more per year, and in Arizona, the person would have to pay $22,074 more, according to the AARP study. “This increase is simply unaffordable,” the study says. 

Medicaid directors issue warning on new ObamaCare repeal bill -- The National Association of Medicaid Directors (NAMD) warned Republicans on Thursday that the Senate's latest ObamaCare repeal bill would place a massive burden on states.The bill, sponsored by Sens. Lindsey Graham (R-S.C.) and Bill Cassidy(R-La.), would eliminate ObamaCare's Medicaid expansion and subsidies beginning in 2020, converting the funding to state block grants.It would also change the federal government's funding of the traditional Medicaid program from an open-ended commitment to the states to a per capita cap on each enrollee."Taken together, the per-capita caps and the envisioned block grant would constitute the largest intergovernmental transfer of financial risk from the federal government to the states in our country’s history," the NAMD's board of directors wrote in a statement Thursday.The NAMD, which is a coalition of Medicaid directors from every state, noted that while the proposal is intended to create maximum flexibility, it does not provide the statutory reforms necessary "commensurate with proposed funding reductions."The GOP bill would also require states create their own health-care programs by 2020, which the directors argue is a massive undertaking."The scope of this work, and the resources required to support state planning and implementation activities, cannot be overstated," the directors said.  "States will need to develop overall strategies, invest in infrastructure development, systems changes, provider and managed care plan contracting, and perform a host of other activities. The vast majority of states will not be able to do so within the two-year timeframe envisioned here, especially considering the apparent lack of federal funding in the bill to support these critical activities."

The G.O.P. Bill Forces States to Build Health Systems From Scratch. That’s Hard -- In 2003, health care policy makers in Massachusetts agreed that the state should build a system to expand coverage to its uninsured residents.  It took four years before Romneycare was fully up and running.  A new health care bill before the Senate would require all the states in the country to make a similar soup-to-nuts evaluation of how they’d like their health care systems to work, to build such a system and be ready to open their doors in substantially less time — just over two years. That may not be realistic.  “That’s not enough time for most states to figure it out.”The bill, proposed by Bill Cassidy and Lindsey Graham, would eliminate Obamacare’s expansion of state Medicaid programs to cover poor adults and its system of subsidies to help middle-income Americans buy their own insurance in state marketplaces. Instead, it would allow states to apply for big block grants of money once they have developed a plan to use the money to provide health care or health insurance coverage.The language of the bill provides them with a nearly unlimited range of policy options to use the money in the service of providing health care access, and no templates or fallback options.Republican governors from 15 states have endorsed the bill, saying that “adequately funded, flexible block grants to the states are the last, best hope to finally repeal and replace Obamacare.”States could use the money in any number of ways: state insurance programs, subsidies for private insurance, direct payments to health providers, high-risk pools or more. They would be free to preserve the central consumer protections created by Obamacare, or to decide to allow insurers to limit benefits or charge higher prices to sicker customers than healthier ones. The challenges would fall into two major categories. First, states would need to make political choices about what they want their system to look like. Next, they would need to submit applications, hire contractors and build new systems to run them. Neither would be easy.

If the U.S. Adopts the G.O.P.’s Health-Care Bill, It Would Be an Act of Mass Suicide - The fundamental thing to understand about Senate Republicans’ latest attempt to repeal Obamacare is that the bill under consideration would not just undo the Affordable Care Act—it would also end Medicaid as we know it and our federal government’s half-century commitment to closing the country’s yawning gaps in health coverage. And it would do so without putting in place any credible resources or policies to replace the system it is overturning. If our country enacts this bill, it would be an act of mass suicide. The Republican bill currently being rushed to a vote was put forward by a group of senators led by Lindsey Graham, of South Carolina, and Bill Cassidy, of Louisiana. As has become the apparent rule for Republican health-care bills, there have been no hearings or committee reviews of the Graham-Cassidy bill. And, this time, lawmakers and the public do not even have a Congressional Budget Office analysis of the effects the bill would have on the budget, insurance costs, or the uninsured rate. This is unprecedented: senators are moving ahead with a vote on a bill that would alter the health care of every American family and the condition of a sixth of our entire economy, without waiting to hear any official, independent estimates of the consequences. The irresponsibility is as blithe as it is breathtaking. Before becoming a senator, Cassidy spent twenty-five years working as a physician in hospitals devoted to the uninsured. I find it baffling that a person with his experience would not recognize the danger of this bill. But here we are. The Graham-Cassidy bill goes even further than the bill passed by the House. It would bring to a virtually immediate end not only the individual and employer mandates but also the whole edifice of the Medicaid expansion, insurance exchanges, and income-based coverage subsidies set up under the A.C.A. Graham-Cassidy expects all fifty states to then pass, and implement, alternative health systems for tens of millions of people within two years—with drastically less money, in most states, than the current law provides. This is not just impossible. It is delusional. 

McCain says he will vote no on GOP health-care bill, dealing major blow to repeal effort - Sen. John McCain (R-Ariz.) announced Friday that he does not support the latest Republican effort to dismantle the Affordable Care Act, dealing a major and potentially decisive blow to the last-ditch attempt to fulfill a seven-year GOP promise. McCain’s comments came on the same day that Sen. Susan Collins (R-Maine), who like McCain, voted against a GOP repeal bill in July, said she was likely to oppose the proposal, leaving the legislation on the brink of failure. The Arizona Republican joins Sen. Rand Paul (R-Ky.) in formally opposing the plan. Senate Republicans cannot afford any more GOP defections, given their narrow 52-48 majority and the united Democratic resistance to repealing President Barack Obama’s signature health-care law. In a lengthy written statement, McCain said he “cannot in good conscience” vote for the bill authored by Sens. Bill Cassidy (R-La.) and Lindsey O. Graham (R-S.C.), which GOP leaders have been aiming to bring to the Senate floor next week. As he has done all week, he railed against the hurried process Senate GOP leaders used to move ahead. “I would consider supporting legislation similar to that offered by my friends Senators Graham and Cassidy were it the product of extensive hearings, debate and amendment. But that has not been the case,” McCain said. He blamed a looming Sept. 30 deadline that GOP leaders were racing to meet to take advantage of a procedural rule allowing them to pass their bill with just 51 votes. Senate Republicans are trying to revive the momentum to overhaul the Affordable Care Act with the Cassidy-Graham proposal. Here are five things to know about the plan and the rush to pass it. (Jenny Starrs/The Washington Post) McCain also said he could not vote for a bill without a complete snapshot of its effects from the nonpartisan Congressional Budget Office, which said earlier this week it could only provide a partial picture by next week. The office said it could not determine the bill’s impact on insurance premiums or project the change in insurance coverage levels it would trigger until a later date. “I believe we could do better working together, Republicans and Democrats, and have not yet really tried,” McCain said. He added that he took “no pleasure” in his announcement. McCain and Graham are close friends.

Sunday Hours: Obamacare Website To Be Shut Down For Portion of Most Weekends  -- The Trump administration plans to shut down the federal health insurance exchange for 12 hours during all but one Sunday in the upcoming open enrollment season.The shutdown will occur from 12 a.m. to 12 p.m. ET on every Sunday except Dec. 10. The Department of Health and Human Services will also shut down the federal exchange — healthcare.gov — overnight on the first day of open enrollment, Nov. 1. More than three dozen states use that exchange for their marketplaces.  HHS officials disclosed this information Friday during a webinar with community groups that help people enroll. The Trump administration has come under attack from critics who say that it is intentionally undermining the Affordable Care Act, through regulatory actions. It shortened the enrollment period, withdrew money for advertising and cut the budget for navigator groups, which help people shop for plans.

White House: Border wall funding doesn’t have to be tied to DACA legislation | TheHill: White House legislative affairs director Marc Short told reporters on Tuesday that President Trump would not demand that border wall funding is tied to a legislative replacement for the Deferred Action for Childhood Arrivals (DACA) program. Speaking at a roundtable event hosted by the Christian Science Monitor, Short said the administration didn’t want to “bind” itself by making a demand that would likely be a nonstarter for many lawmakers. “We’re interested in getting border security and the president has made the commitment to the American people that a barrier is important to that security,” Short said. “Whether or not that is part of a DACA equation, or ... another legislative vehicle, I don’t want to bind us into a construct that would make the conclusion on DACA impossible.”There had been speculation that Trump would require any compromise on potential DACA legislation include money for a wall along the southern border. Short was adamant that his remarks are not an indication that the president is going soft on the wall. “The president is not backing off a border wall,” he said. “The president is committed to sticking by the commitment that a physical structure is needed ... whether that is part of a DACA package or another package, I won’t prejudge that today, but he’s committed to getting that wall built.” Short's comments echo House Freedom Caucus Chairman Mark Meadows (R-N.C.), who similarly said last week that he wouldn't demand border wall funding be tied to DACA legislation. “I don’t know that it’s border wall funding, but it’s certainly a secure southern border,” Meadows told reporters on Thursday. 

 3 Democratic Congressmen Arrested For Protesting Outside Trump Tower -- Three Democratic Congressmen were arrested this morning while protesting outside President Trump's Manhattan residence, to demand action to shield young illegal immigrants from deportation. Democratic Reps. Luis Gutierrez (Ill.), Raul Grijalva (Ariz.) and Adriano Espaillat (N.Y.) were all arrested while rallying outside Trump Tower.  This is not Gutierrez' first arrest. As The Hill reports, he has been busy...Tuesday marked the second time in five weeks that Gutierrez was arrested as part of an immigration protest.Gutierrez was also arrested in mid-August outside the White House during a rally commemorating the fifth anniversary of DACA.He had been arrested outside the White House twice before that, in 2010 and 2011, during similar protests.Gutierrez was additionally arrested at a Chicago Immigration and Customs Enforcement office in March while protesting deportations of DACA recipients. The lawmakers and advocacy groups are pressing Trump to work with Congress to pass a “clean” version of the DREAM Act granting undocumented immigrants brought to the U.S. as children a path to citizenship, without including border security measures meant to placate immigration hawks.“  We’re taking the necessary steps to make it clear to President Trump, the Republicans and the Democrats that we will continue this peaceful fight for DREAMers and immigrants as long as it takes to enact legislation and put DREAMers in a safe place,” Gutierrez, the chair of the Congressional Hispanic Caucus Immigration Task Force, said in a statement.

Judge rules in city's favor on sanctuary cities, grants nationwide injunction -- In a ruling with national impact, a federal judge in Chicago on Friday blocked the Trump administration's rules requiring so-called sanctuary cities to cooperate with immigration agents in order to get a public safety grant.U.S. District Judge Harry Leinenweber held that Chicago has shown a "likelihood of success" in its arguments that U.S. Attorney General Jeff Sessions exceeded his authority in imposing new standards governing Edward Byrne Memorial Justice Assistance Grants across the country.He also said Mayor Rahm Emanuel's administration has shown the city could suffer "irreparable harm" in its relationship with the immigrant community if it were to comply with the U.S. Department of Justice's new standards."Once such trust is lost, it cannot be repaired through an award of money damages, making it the type of harm that is especially hard to rectify" were he to wait until the lawsuit is settled, Leinenweber wrote in the 41-page ruling.The preliminary injunction granted by Leinenweber applies to districts nationwide. At a hastily arranged news conference at City Hall on Friday, Emanuel cast the ruling as a national victory against the immigration policies of President Donald Trump."I want to be clear, this is not just a victory for the city of Chicago," the mayor said. "It is a win for cities, counties and states across the country who also filed amicus briefs on behalf of our lawsuit, and also the business leaders who also stepped forward on our lawsuit."

Governor Cuomo Signs Executive Order Prohibiting State Agencies from Inquiring About Immigration Status - Governor Andrew M. Cuomo today issued Executive Order 170 that prohibits state agencies and officers from inquiring about or disclosing an individual's immigration status unless required by law or necessary to determine eligibility for a benefit or service. Law enforcement officers will also be prohibited from inquiring about immigration status unless investigating illegal criminal activity. This prohibition against inquiring into status includes, but is not limited to, when an individual approaches a law enforcement officer seeking assistance, is the victim of a crime, or is witness to a crime."As Washington squabbles over rolling back sensible immigration policy, we are taking action to help protect all New Yorkers from unwarranted targeting by government," Governor Cuomo said. "New York became the Empire State due to the contributions of immigrants from every corner of the globe and we will not let the politics of fear and intimidation divide us."The Executive Order builds on Governor Cuomo's commitment to ensure full protections for all immigrants in New York. In March, Governor Cuomo launched the Liberty Defense Project, the nation's first public-private immigrant legal defense initiative, to respond to the surge in demand for help that is overwhelming nonprofit organizations serving immigrants. The partnership is supported by more than $10 million in funding to offer legal assistance and representation to immigrants in New York, regardless of their status, through a statewide network of attorneys and advocacy organizations.

Trump’s Travel Ban Decision Could Set Off New Wave of Turmoil - President Donald Trump is on the verge of a fresh clash with business leaders and civil-rights advocates as he faces a critical deadline this weekend for continuing his travel ban on six predominantly Muslim countries. The president hinted he might broaden the initial ban, which is set to expire on Sunday, in his response to a terrorist attack in London last week. Even mere renewal of the prohibition on entry into the U.S. by most citizens of those nations would reopen controversy over an action that provoked sharp criticism from prominent corporate leaders, multiple court challenges and internal strife within the White House. Trump may announce his decision on the next step as as soon as Friday, said two administration officials familiar with the process who spoke on condition of anonymity. Neither would describe his leanings among the options, which include extending the temporary ban, expanding the ban or otherwise modifying it, making it permanent or allowing it to lapse. The Department of Homeland Security sent Trump a classified report last week with details on its review of the vetting process for people entering the U.S., in accordance with the March 6 executive order, said DHS spokesman David Lapan. The report was supposed to include a list of countries recommended for travel restrictions going forward. White House and DHS officials declined to provide details on the report. Trump’s initial travel ban, imposed Jan. 27, caused confusion at U.S. ports of entry and set off spontaneous demonstrations at airports. It also brought the first major fusillade of criticism of the administration from corporate leaders. Some of the rifts have widened following Trump’s handling of white supremacist violence in Charlottesville, Virginia, and his decision to end an Obama-era policy protecting young undocumented immigrants from deportation. But Trump suggested after the London attack that the current restrictions on travel to the U.S. don’t go far enough. “The travel ban into the United States should be far larger, tougher and more specific,” Trump tweeted Sept. 15, hours after a homemade bomb on a city subway injured dozens.

Electronic Frontier Foundation and ACLU Sue Over Warrantless Phone, Laptop Searches at US Border - Jerri-lynn Scofield -  The Electronic Frontier Foundation (EFF) and the American Civil Liberties Union (ACLU) filed suit against the Department of Homeland Security (DHS), US Customs and Border Protection (CBP), and US Customs and Immigration Enforcement (ICE) last week on behalf of 11 travelers whose smartphones and laptops were subjected to warrantless searches at the US border. As the EFF and ACLU spelled out in a press release announcing the suit: The plaintiffs in the case are 10 U.S. citizens and one lawful permanent resident who hail from seven states and come from a variety of backgrounds. The lawsuit challenges the government’s fast-growing practice of searching travelers’ electronic devices without a warrant. It seeks to establish that the government must have a warrant based on probable cause to suspect a violation of immigration or customs laws before conducting such searches. The practice of searching electronic devices at the border did not originate with the Trump administration.  The number of such searches began to climb in 2016, and has increased further during the Trump administration, as Table 2 below se EFF/ACLU hows. (I realize that the figures only cover a short period and would have liked to be able to present more comprehensive numbers; these were the best I was able to find. Some additional numbers can be found in the EFF/ACLU press release.) Business Insider reports: As the US Customs and Border Protection (CBP) outlines in a tearsheet it provides to people at the border, federal agents today can seize and search your phone, and even make a copy of it to have forensic experts analyze its contents off-site. “This isn’t rogue officers; this is the official, written policy of the US government,” Adam Schwartz, senior staff attorney with the Electronic Frontier Foundation (EFF) said in a conference call on Wednesday. And, I should add, they do all this, every day– without securing any warrants.

How Rich Chinese Use Visa Fixers To Move To The U.S. -- Some immigrants pile into rafts or fishing boats to get to America. Others try to slip past the cameras and sensors along the southern border. And many simply pay up via the EB-5 visa program, through which U.S. Citizenship and Immigration Services issues 10,000 conditional green cards annually. By investing $500,000 in areas deemed economically distressed, prospective immigrants can get temporary U.S. residence for themselves and their families. Anyone whose investment creates 10 jobs can apply to become a permanent resident.When the program started, in 1990, Congress was squeamish about creating the impression that U.S. visas were for sale, so the law specifies that investors’ money must be at risk. The hope was that the program would jump-start development in moribund rural areas. But it languished unused for years, until developers in New York and other large cities figured out how to get just about any area to qualify as distressed, and the program took off. In recent years more than 90 percent of EB-5 investments have been in cities, and about three-quarters in real estate—often luxury residential properties in Manhattan. Most of the money comes from Chinese investors lined up by fixers such as Ding, who flood WeChat with advertisements and bring over American politicians to attach their names to projects, like Hollywood stars hawking whiskey in Japan. Post-Brexit, mid-Trump, borders appear to be tightening, but China’s visa fixers still sell a world of limitless possibilities. They’ve turned some of the world’s most forbidding bureaucratic machinery into a kind of consumer good for China’s rising wealthy class. “No other country in the world comes anywhere near the Chinese market in terms of the network of agents,” says Philadelphia attorney Ron Klasko, who heads the American Immigration Lawyers Association’s EB-5 committee. At least 1,000 migration agents are registered in China, and industry participants say there are many more unofficial ones.“Some operate at an exceedingly high level,” Klasko says, “and some do not.”

  House Passes Amendment Rolling Back Jeff Sessions’s Civil Asset Forfeiture Expansion -  Attorney General Jeff Sessions has been going hot and heavy on a 1980s-esque law enforcement policy revival. He booted the DOJ off the civil rights beat, telling states and cities to solve their own police misconduct problems — something they were clearly unwilling to do on their own, hence the DOJ’s intercession. He told cops they’re getting back their access to war gear, rolling back the Obama administration’s minimal 1033 program reforms. He’s been touting tougher policing and tougher sentencing, using a false narrative of a country under siege by drug dealers and criminal border-jumpers. In a time of historic lows — both in violent criminal activity and violence towards police officers — AG Sessions is acting like a street corner preacher, promising an impending apocalypse to anyone who will listen. Sessions is also peeling away federal reforms to asset forfeiture. He’s opened the federal safety valve for civil forfeitures, allowing local PDs to dodge state laws limiting the amount of property they can take from uncharged citizens. Given the makeup of Congress, one would assume Sessions’ ongoing effort to raise US law enforcement to “a law unto itself” level would ride on rails, at least up until midterm elections. Instead, Sessions is facing a literal House divided — not against itself exactly — but against him. In a stunning move, the House of Representatives on Tuesday approved an amendment to the Make America Secure and Prosperous Appropriations Act that will roll back Attorney General Jeff Sessions’s expansion of asset forfeiture. Amendment number 126 was sponsored by a bipartisan group of nine members, led by Michigan Republican Rep. Justin Amash. He was joined by Democratic Reps. Ro Khanna of California; Washington state’s Pramila Jayapal, a rising progressive star; and Hawaii’s Tulsi Gabbard. If this passes the Senate untouched, the amendment will roll things back to 2015 — once again prohibiting federal adoption of local forfeitures. It would make state and local agencies play by the rules set for them by their legislatures, rather than allow them to bypass protections put in place to discourage abuse of programs loaded with the most perverted of incentives.

Senators to reintroduce bipartisan criminal justice bill | TheHill: Senators are planning to take a second stab at passing a bipartisan criminal justice reform bill after it stalled amid GOP infighting. Sens. Dick Durbin (D-Ill.) and Chuck Grassley (R-Iowa) said Tuesday that they will reintroduce the Sentencing Reform and Corrections Act, though they didn't specify a timeline for when they could roll out the legislation. The bill, originally introduced in 2015, would reduce mandatory minimum sentences for certain drug offenses and armed career criminals while increasing mandatory minimums for other offenses such as domestic violence. "While the political landscape in Washington has changed, the same problems presented by the current sentencing regime remain," Grassley said in a statement.Durbin, noting senators have been working on the issue for five years, called it the "best chance in a generation to right the wrongs of a badly broken system." "We believe this legislation would pass the Senate with a strong bipartisan vote—it’s time to get this done," he said. 

 Exclusive: Trump administration prepares to ease export rules for U.S. guns  (Reuters) - The Trump administration is preparing to make it easier for American gun makers to sell small arms, including assault rifles and ammunition, to foreign buyers, according to senior U.S. officials. Aides to President Donald Trump are completing a plan to shift oversight of international non-military firearms sales from the State Department to the Commerce Department, four officials told Reuters. While the State Department is primarily concerned about international threats to stability and maintains tight restrictions on weapons deals, the Commerce Department typically focuses more on facilitating trade. The officials from multiple agencies, speaking on condition of anonymity, say the new rules will cut government red tape and regulatory costs, boosting U.S. exports of small arms and creating jobs at home. “There will be more leeway to do arms sales,” one senior administration official said. “You could really turn the spigot on if you do it the right way.” The push fits both Trump’s support for the gun lobby espoused on the campaign trail and his “Buy American” agenda. But critics, including some lawmakers and arms control advocates, have expressed concern that any easing of export rules could make powerful weapons of the type often used in U.S. mass shootings more accessible to criminal gangs and militant groups that Trump has vowed to fight. The administration has all but finalized a draft of the new rules, which could be sent to the White House budget office for review within days, one U.S. official said. The changes – which can be enacted without congressional approval - could be made public this fall, followed by a period of public comment, with implementation as early as the first half of next year, the officials said. The officials stressed, however, that the proposed shift in oversight was not a blanket deregulation of firearms.

Price’s private-jet travel breaks precedent - POLITICO: In a sharp departure from his predecessors, Health and Human Services Secretary Tom Price last week took private jets on five separate flights for official business, at a cost of tens of thousands of dollars more than commercial travel. The secretary’s five flights, which were scheduled between Sept. 13 and Sept. 15, took him to a resort in Maine where he participated in a Q&A discussion with a health care industry CEO, and to community health centers in New Hampshire and Pennsylvania, according to internal HHS documents. The travel by corporate-style jet comes at a time when other members of the Trump administration are under fire for travel expenditures, and breaks with the practices of Obama-era secretaries Sylvia Mathews Burwell and Kathleen Sebelius, who flew commercially while in the continental United States. Price, a frequent critic of federal spending who has been developing a plan for departmentwide cost savings, declined to comment. HHS spokespeople declined to confirm details of the flights or respond to questions about who paid for them, with a spokesperson saying only that Price sometimes charters planes when commercial flights aren’t feasible. All three organizations that hosted Price last week — the Massachusetts-based health IT firm athenahealth, Goodwin Community Health Center in New Hampshire and the Mirmont Treatment Center in Pennsylvania — told POLITICO they did not pay for his flights or other travel costs. “As part of the HHS mission to enhance and protect the health and well-being of the American people, Secretary Price travels on occasion outside Washington to meet face to face with the American people to hear their thoughts and concerns firsthand,” an HHS spokesperson said, adding, “When commercial aircraft cannot reasonably accommodate travel requirements, charter aircraft can be used for official travel.”

Donald Trump Jr. gives up his Secret Service protection -- Donald Trump Jr. has given up his Secret Service protection and is seeking a more private lifestyle, The New York Times reported on Monday. According to the report, the Secret Service stopped protecting Trump Jr., the eldest child of President Donald Trump and an executive of the Trump Organization, last week. Trump Jr. is seeking more privacy than he can be afforded with federal agents by his side, The Times said, noting Trump Jr.'s affinity for camping and hunting. The suspension of Trump Jr.'s protection is welcome news for the Secret Service. The agency has been spread thin because of the Trump family's large size and frequent travel, which includes the president's near-weekly outings to his golf clubs and other properties and his children's overseas business trips. Kellyanne Conway, counselor to Trump, is also no longer receiving Secret Service protection, according to CNN White House correspondent Jim Acosta. Conway had been authorized for the agency's services by Trump, after having received several threats, New York Magazine reported in March. USA Today reported in August that more than 1,000 Secret Service agents had reached the mandated caps for salary and overtime allowances, depleting funds meant to last the entire year. 

Impeaching Trump and America Under a President Pence - While I have posted on this subject before the 2016 election, in this time where it appears that Washington (including both the Democrats and at least some Republicans) along with the mainstream media are doing everything in their power to get rid of Donald Trump, I thought it would be prudent to revisit the belief system of the man that will replace him, Vice President Mike Pence, a man who garners almost no press coverage.Thanks to the internet which never forgets anything, we can see what Mr. Pence had to say about key issues during his tenure in Congress and as Governor of Indiana.  The website, On The Issues, provides us with a complete listing of every vote that Mike Pence took part in while in Congress as well as what he had to say about key issues during his tenure in government prior to entering the White House.As a bit of background and to help you put the dates into context, between January 3, 2001 and January 3, 2011, Mike Pence served as a Republican Representative in the House of Representatives from Indiana's second and sixth districts.  From January 14, 2013 to January 9, 2017, he served as Governor of Indiana.Here is a summary of his voting record on seven key issues that provide us with a snapshot of Mike Pence's political leanings:

The Russian Hacking Story Continues to Unravel - A new report by a retired IT executive at IBM, debunks the claim that Russia interfered in the 2016 presidential campaign by hacking Democratic computers and circulating damaging information about Hillary Clinton.  The report, which is titled “The Non-Existent Foundation for Russian Hacking Charge“,  provides a rigorous examination of the wobbly allegations upon which the hacking theory is based, as well as a point by point rejection of the primary claims which, in the final analysis, fail to pass the smell test. While the report is worth reading in full, our intention is to zero-in on the parts of the text that disprove the claims that Russia meddled in US elections or hacked the servers at the DNC. Let’s start with the fact that there are at least two credible witnesses who claim to know who took the DNC emails and transferred them to WikiLeaks. We’re talking about WikiLeaks founder Julian Assange and WikiLeaks ally, Craig Murray. No one is in a better position to know who actually took the emails than Assange, and yet, Assange has repeatedly said that Russia was not the source. Check out this clip from the report:Can you think of a more credible witness than Julian Assange?  The man has devoted his entire adult life to exposing the truth about government despite the risks his actions pose to his own personal safety. In fact, he is currently holed up at the Ecuador embassy in London for defending the public’s right to know what their government is up to. Does anyone seriously think that a man like that would deliberately lie just to protect Russia’s reputation?No, of course not, and the new report backs him up on this matter. It states:  “No where in the Intelligence Community’s Assessment (ICA) was there any evidence of any connection between Russia and WikiLeaks.” The reason Assange keeps saying that Russia wasn’t involved is because Russia wasn’t involved. There’s nothing more to it than that. As for the other eyewitness, Craig Murray, he has also flatly denied that Russia provided WikiLeaks with the DNC emails.  Check out this except from an article at The Daily Mail: Is Craig Murray, the former British ambassador to Uzbekistan and human rights activist, a credible witness? But the FBI has never questioned Assange or Murray, in fact, the FBI has never even tried to get in touch with either of them. Never. Not even a lousy phone call. It’s like they don’t exist.

 Make Mark Zuckerberg Testify -- Last week, after what must have been a series of extremely grim meetings in Menlo Park,Facebook admitted publicly that part of its revenue includes what appears to be politically motivated fraud undertaken by a shady Russian company. The social network, perhaps motivated by a Washington Post scoop on the matter, released astatement outlining the issues at hand, but leaving the most important questions unanswered. Only Facebook knows these answers, and we should assume they won’t be eager to volunteer them.After last week’s reports, Facebook received a round of emails and calls from reporters asking for clarifications on the many glaring gaps in the social network’s disclosure:

  • What was the content of the Russian-backed ads in question?
  • How many people saw these ads? How many people clicked them?
  • What were the Facebook pages associated with the ads? How many members did they have?
  • What specific targeting criteria (race, age, and most importantly, location) did the Russian ads choose?

Given that Facebook reaches a little under 30 percent of the entire population of our planet, the answers to these questions matter. The response I received from Facebook PR (“We are not commenting beyond the blog post at this time”) is typical. But even when Facebook does decide to talk to journalists, it has the tenor of an occult priest discussing something from beyond an eerie void: Just last week, when faced with a report that its advertising numbers promised an American audience that, in certain demographics, well exceeded the number of such humans in existence, judging by U.S. Census Bureau numbers, Facebook told the Wall Street Journal that its numbers “are not designed to match population or census estimates. We are always working to improve our estimates.” Facebook’s intercourse with the public need not adhere to the so-called norms of so-called reality.

Mueller just obtained a warrant that could change the entire nature of the Russia investigation - Robert Mueller, the FBI special counsel, reportedly obtained a search warrant for records of the "inauthentic" accounts Facebook shut down earlier this month and the targeted ads these accounts purchased during the 2016 election. The warrant was first disclosed by The Wall Street Journal on Friday night and later confirmed by CNN. Legal experts say the revelation has enormous implications for the trajectory of the FBI's investigation into Russia's election interference and into whether Moscow had any help from President Donald Trump's campaign team. "This is big news — and potentially bad news for the Russian election interference 'deniers,'" said Asha Rangappa, a former FBI counterintelligence agent. Rangappa, now an associate dean at Yale Law School, explained that to obtain a search warrant a prosecutor needs to prove to a judge that there is reason to believe a crime has been committed. The prosecutor then has to show that the information sought will provide evidence of that crime. Mueller would not have sought a warrant targeting Facebook as a company, Rangappa said. Rather, he would have been interested in learning more about specific accounts. "The key here, though, is that Mueller clearly already has enough information on these accounts — and their link to a potential crime to justify forcing [Facebook] to give up the info," she said. "That means that he has uncovered a great deal of evidence through other avenues of Russian election interference."  It also means Mueller is no longer looking at Russia's election interference from a strict counterintelligence standpoint — he now thinks he may be able to obtain enough evidence to charge specific foreign entities with a crime.

The (Thus Far) Flimsy Case for Republican Cooperation on Russian Targeting - A number of credulous people are reading this article this morning and sharing it, claiming it is a smoking gun supporting the case that Republicans helped the Russians target their social media, in spite of this line, six paragraphs in. No evidence has emerged to link Kushner, Cambridge Analytica, or Manafort to the Russian election-meddling enterprise; Not only is there not yet evidence supporting the claim that Republican party apparatchiks helped Russians target their social media activity, not only does the evidence thus far raise real questions about the efficacy of what Russia did (though that will likely change, especially once we learn more about other platforms), but folks arguing for assistance are ignoring already-public evidence and far more obvious means by which assistance might be obtained. Don’t get me wrong. I’m acutely interested in the role of Cambridge Analytica, the micro-targeting company that melds Robert Mercer’s money with Facebook’s privatized spying (and was before it was fashionable). I first focused on Jared Kushner’s role in that process, which people are gleefully discovering now, back in May. I have repeatedly said that Facebook — which has been forthcoming about analyzing and sharing (small parts) of its data — and Twitter — which has been less forthcoming — and Google — which is still channeling Sargent Schultz — should be more transparent and have independent experts review their methodology. I’ve also been pointing out, longer than most, of the import of concentration among social media giants as a key vulnerability Russia exploited. I’m particularly interested in whether Russian operatives manipulated influencers — on Twitter, but especially in 4Chan — to magnify anti-Hillary hostility. We may find a lot of evidence that Russia had a big impact on the US election via social media.

With a Picked Lock and a Threatened Indictment, Mueller’s Inquiry Sets a Tone — Paul J. Manafort was in bed early one morning in July when federal agents bearing a search warrant picked the lock on his front door and raided his Virginia home. They took binders stuffed with documents and copied his computer files, looking for evidence that Mr. Manafort, President Trump’s former campaign chairman, set up secret offshore bank accounts. They even photographed the expensive suits in his closet.The special counsel, Robert S. Mueller III, then followed the house search with a warning: His prosecutors told Mr. Manafort they planned to indict him, said two people close to the investigation.The moves against Mr. Manafort are just a glimpse of the aggressive tactics used by Mr. Mueller and his team of prosecutors in the four months since taking over the Justice Department’s investigation into Russia’s attempts to disrupt last year’s election, according to lawyers, witnesses and American officials who have described the approach. Dispensing with the plodding pace typical of many white-collar investigations, Mr. Mueller’s team has used what some describe as shock-and-awe tactics to intimidate witnesses and potential targets of the inquiry. Mr. Mueller has obtained a flurry of subpoenas to compel witnesses to testify before a grand jury, lawyers and witnesses say, sometimes before his prosecutors have taken the customary first step of interviewing them. One witness was called before the grand jury less than a month after his name surfaced in news accounts. The special counsel even took the unusual step of obtaining a subpoena for one of Mr. Manafort’s former lawyers, claiming an exception to the rule that shields attorney-client discussions from scrutiny. “They are setting a tone. It’s important early on to strike terror in the hearts of people in Washington, or else you will be rolled,”  “You want people saying to themselves, ‘Man, I had better tell these guys the truth.’”

Exclusive: US government wiretapped former Trump campaign chairman -- US investigators wiretapped former Trump campaign chairman Paul Manafort under secret court orders before and after the election, sources tell CNN, an extraordinary step involving a high-ranking campaign official now at the center of the Russia meddling probe. The government snooping continued into early this year, including a period when Manafort was known to talk to President Donald Trump.Some of the intelligence collected includes communications that sparked concerns among investigators that Manafort had encouraged the Russians to help with the campaign, according to three sources familiar with the investigation. Two of these sources, however, cautioned that the evidence is not conclusive.  Special counsel Robert Mueller's team, which is leading the investigation into Russia's involvement in the election, has been provided details of these communications. A secret order authorized by the court that handles the Foreign Intelligence Surveillance Act (FISA) began after Manafort became the subject of an FBI investigation that began in 2014. It centered on work done by a group of Washington consulting firms for Ukraine's former ruling party, the sources told CNN.

Manafort Calls On DOJ To Release His Intercepted Phone Calls; Demands Investigation Of Leaks --Less than 24 hours after CNN triggered the latest outbreak of 'Trump Derangement Syndrome' by relaying information from anonymous sources that Trump's former campaign manager Paul Manfort has been under surveillance by the FBI since 2014,Manafort has fired back by calling on the Department of Justice to release all transcripts of his tapped phone calls so that the American public "can come to the same conclusion as the DOJ — there is nothing there."  Per the Daily Caller:Former Trump campaign manager Paul Manafort is calling on the Justice Department to release transcripts of any intercepted communications he may have had with foreigners.Manafort, a longtime Republican political consultant, also called on the Justice Department’s inspector general to investigate the leak of details of secret surveillance warrants obtained by U.S. investigators.“Mr. Manafort requests that the Department of Justice release any intercepts involving him and any non-Americans so interested parties can come to the same conclusion as the DOJ — there is nothing there,”Manafort spokesman Jason Maloni said in a statement.Manafort's spokesman goes on to demand that the DOJ launch an immediate investigation into who continues to commit federal felonies with reckless abandon by leaking details of confidential FISA warrants to the media.Whether or not Manafort committed a crime — and he has not been charged with anything — the leak of information about FISA warrants is a federal crime, Maloni noted in his statement.“If true, it is a felony to reveal the existence of a FISA warrant, regardless of the fact that no charges ever emerged,” Maloni said.

Paul Manafort hired to help promote Kurdish independence vote in Iraq that the US opposes --Paul Manafort is working with associates of Iraqi Kurdish leaders to boost a referendum effort there, The New York Times reported on Wednesday night. The initiative could usher in Kurdish independence from Iraq, a move that is frowned upon by the US. According to The Times, Manafort's work for the Kurdish group may have begun this summer. The referendum is set for Monday. The development comes as Manafort faces increasing scrutiny in a wide-ranging US investigation of possible collusion between Donald Trump's presidential campaign and Russian operatives. Manafort is firmly at the center of the investigation led by Robert Mueller, the special counsel, on behalf of the US Justice Department. Developments in Mueller's case revealed most recently have found that Manafort:

The increased focus on Manafort suggests that Mueller may be trying to flip him to gather inside information on people close to Trump and perhaps Trump himself, legal experts have said.

Clapper: Russia's election interference 'cast doubt on the legitimacy' of Trump's victory : James Clapper, the former director of national intelligence, said Friday that the US intelligence community's assessment of Russia's interference in the 2016 election "cast doubt on the legitimacy" of President Donald Trump's victory. "Our intelligence community assessment did serve to cast doubt on the legitimacy of his victory in the election," Clapper said of Trump in a CNN interview Friday evening. "I think that, above all else, is what concerned him, and I think that transcends, unfortunately, the real concern here, which is Russian interference in our political process which, by the way, is going to continue," Clapper said.  It was the most direct assertion about the effects Russian operatives had in the US election — the investigation of which has evolved exponentially in the last four months under special counsel Robert Mueller, who is overseeing the Russia probe on behalf of the US Justice Department.  Mueller and his investigators have focused on several people close to Trump who have ties to, or have made contact with, the Kremlin — including former campaign chairman Paul Manafort, former national security adviser Michael Flynn, and others. Information gleaned from US government surveillance of Manafort prompted concerns that he had encouraged Russians to "help with the campaign," according to a CNN report on Monday.

Prosecutors Demand 2-Year Prison Sentence For Anthony Weiner -- After being widely blamed by Hillary Clinton supporters – and even the candidate herself – for inadvertently prompting the FBI to reopen its investigation into whether the candidate mishandled classified information, it looks like Anthony Weiner, once believed to be a strong contender for Mayor of New York City, is going to prison. The Associated Press reports that federal prosecutors are asking that the former Congressman be sentenced to about two years in prison for engaging in sexting with a 15-year-old girl. Prosecutors filed paper in Manhattan Federal Court on Wednesday in advance of Weiner’s sentencing, which is scheduled for Monday. In their paperwork, the prosecutors asked that the judge use the sentencing as an opportunity to send a message to other perverted pols. The 53-year-old said in a submission last week that he's undergoing treatment and is profoundly sorry for subjecting the North Carolina high school student to what his lawyers described as his "deep sickness." Prosecutors say this isn’t the first time Weiner has promised to reform himself. Weiner’s lawyers portrayed the girl as an aggressor, saying she wanted to generate material for a book and possibly influence the presidential election, according to the AP. As part of his plea bargain, Weiner has agreed not to appeal any sentence between 21 and 27 months.

 Obama Has the Same Retirement Plan as the Clintons: Lavish Speaking Fees from Wall Street - Pam Martens - The “Wall Street Democrats” is the wing of the party created by the Clintons and nurtured further by Barack Obama. It takes money hand over fist from Wall Street for political campaigns, wags a warning finger at Wall Street from the public podium while stuffing its administrations with Wall Street execs, then its leadership reaps millions of dollars in personal speaking fees from the robber barons after leaving office. As of this morning, there’s no longer any debate that Obama is firmly entrenched in this cozy world of money.Bloomberg News is reporting that former President Obama has accepted upwards of $400,000 a clip to speak before Wall Street firms Northern Trust Corp. and Cantor Fitzgerald and an unspecified sum from Carlyle Group LP. The speeches at Northern Trust and Carlyle Group occurred over the past month and a half. The Cantor Fitzgerald speech is scheduled for next week.Adding to the intrigue, Obama’s future roster of private speeches to Wall Street banks is not available for public inspection. Equally problematic, while it was widely reported in February that Obama has signed with the Harry Walker Agency to represent him for speaking engagements, that agency showcases Bill and Hillary Clinton in its 2017 Speakers Bureau brochure while Obama goes missing. Adding to the curiosity, which went unreported in the Bloomberg article, the Twitter account for the Harry Walker Agency is promoting appearances by its other speakers from Obama’s administration (it represents a stable full) but when we went back months on its Twitter account, we found no mention of Obama’s private speeches that have already occurred since he left office. One might be prone to speculate that Obama has a contractual clause in his agreement with the Harry Walker Agency that it cannot advertize his speaking schedule or to whom he is delivering his highly compensated speeches.

Senator Udall Demands Tougher SEC Pay-to-Play Enforcement, After IBT/MapLight Report -- U.S. Sen. Tom Udall, D-New Mexico, called for federal regulators to begin applying an anti-corruption rule to outside political groups in the wake of an International Business Times/MapLight investigation revealing hundreds of millions of investment dollars flowed to firms whose executives donated to organizations supporting Republican Gov. Susana Martinez. A 2010 Securities and Exchange Commission rule, implemented in the wake of previous New Mexico pay-to-play scandals, was designed to deter financial firms from donating to public officials who influence state investment decisions. The rule included provisions designed to prevent firms from circumventing the rule by routing campaign cash through third parties. IBT/MapLight, however, identified $757 million in state pension dollars invested with eight companies linked to donors who delivered a total of $1.2 million to Martinez and affiliated political committees.  “We have to make sure that the campaign finance rules that are still on the books are updated to reflect these new and dangerous circumstances -- to ensure that no one is able to circumvent these laws by using super PACs, dark money groups or other campaign spending vehicles,” Udall told IBT/MapLight on Thursday. “The public deserves to feel confident that decisions made with public money are not being influenced by big money donors.” SEC regulators said in 2010 that they couldn't predict every way that financial executives and government officials might structure pay-to-play deals. So they banned Wall Street executives from doing “anything indirectly which, if done directly,” would be illegal. The regulators said if a PAC asked for money to support a limited number of government officials, then donations to the PAC could be prohibited.

Repealing crisis-era rules is asking for another AIG -   The actions taken to prevent the collapse of American International Group commenced nine years ago this month. The government’s response to AIG was one of the most controversial chapters of the global financial crisis, even though the intervening years have shown that stabilizing AIG, as distasteful at it was, marked an important milestone in stemming a rapidly developing systemic crisis. But reforms put in place since then — many of which were established by the Dodd-Frank Act — offer essential protections against similar catastrophes occurring in the future. If attempts to repeal those protections are successful, it will be a big step backward. To be clear, AIG would have failed had not the federal government intervened, leaving our economy even more exposed to a systemic collapse. Then-Treasury Secretary Henry Paulson and the Federal Reserve Board acted because they feared an AIG bankruptcy — at that time and in those circumstances — could bring down our financial system. Initially, the Fed provided an $85 billion loan in return for preferred shares in the company. Later, Treasury provided additional funds through the Troubled Asset Relief Program, and the Fed provided over $50 billion in additional credit. The activities that brought AIG to its knees and that required the unfathomable $182 billion the government committed to keep the company afloat made AIG the poster child for the most unsavory aspects of the global financial crisis. Calamity turned to farce when the former chairman of AIG, Maurice Greenberg, sued Treasury and the Fed. He audaciously claimed that their actions were without legal authority and were an unconstitutional “taking” from the shareholders, despite the fact that the company would have gone bankrupt, completely wiping out shareholders, without government intervention. Fortunately, the story got better over time. The federal government ultimately recovered all of the money committed to AIG and then some. The government sold its final AIG shares in 2012, ending up with a total profit of $23 billion. Greenberg eventually lost in court.

Mnuchin shows no interest in continuing FSOC’s hedge fund inquiry -- In 2014, under the Obama administration, the Financial Stability Oversight Council kick-started an initiative aimed at better understanding the risks posed by the asset management sector. The willingness of the Trump administration to continue that work — particularly as it pertains to hedge funds — has been a looming question. The early signs, unfortunately, are not encouraging.Before the Dodd-Frank Act created the FSOC, regulators only focused on their specific slice of the financial sector, with no systemic risk mandate. The lack of a systemic risk regulatory body to foster sustained communication and collaboration among disparate regulators was a key flaw in the financial regulatory structure prior to the financial c risis. Bringing together the different financial regulators around one table, the council gives them the authority to investigate risks to financial stability and the tools necessary to mitigate those financial stability threats across the financial system.The FSOC under former Treasury Secretary Jack Lew initiated the work stream on asset managers with a public conference. As this work stream progressed, the FSOC identified the $3 trillion hedge fund industry as a subsector worthy of enhanced scrutiny, and formed a working group to investigate the issue further. In November 2016, the hedge fund working group provided a public update on the progress of this inquiry and outlined a compelling framework for how hedge funds could pose a systemic risk to the financial sector.  But there is growing concern that the council led by current Treasury Secretary Steven Mnuchin will drop the inquiry. On Friday, Mnuchin was scheduled to preside over his fourth meeting of the FSOC since he assumed the chairmanship of the panel in February. Once again, an update on the council’s work investigating potential financial stability risks posed by the hedge fund industry was missing from the agenda. The lack of progress by the Trump administration to date in following up on the hedge fund inquiry is particularly troubling in light of the ties of Mnuchin and other key Trump backers to the hedge fund industry.

EU’s new data privacy law creates headaches for U.S. banks - What happens when a cookie of a Brit in London lands in the server of a community bank in the U.S. if, on an off-chance, the Brit browses the bank’s website?It’s unclear, experts say, but U.S. banks — especially small and midsize banks — need to go find out because the European Union’s General Data Protection Regulation (GDPR) could affect them, unlike the EU privacy regulations before it.The countdown is ticking on GDPR’s website. The law, approved by the European Parliament in April 2016, will take effect in late May 2018. It will apply to “all companies processing and holding the personal data of data subjects residing in the European Union, regardless of the company’s location,” the website said. “Basically any institution around the world that has an EU citizen, a European subject, is subject [to the law],” said Steve Ehrlich, lead analyst for emerging technologies at Spitzberg Partners LLC, a corporate advisory firm. “An EU subject doesn’t have to be a customer or employee.”  The law can apply even if the company does not have a European business arm, said Pam Dingle, principal technical architect at Ping Identity, a firm that helps companies manage their personnel’s identification needs. Some of GDPR’s provisions will require banks to behave differently than under existing U.S. regulations. One example is that banks need to report data breaches to authorities within 72 hours of their discovery. “That’s not a lot of time,” Dingle said.Large banks are already familiar with the law, said Andy Roth, partner at the law firm Cooley LLP, who focuses on legal issues surrounding new technology. But smaller banks “are just recognizing that they have a potential exposure” and “are now starting to understand what they need to do to get in compliance.” GDPR also requires companies to provide clients with full access to data about themselves.

Role reversal: U.S. leads race to bottom in global bank rules - — The Trump administration's push to deregulate the banking industry is having a ripple effect internationally as foreign banks are pressing their home jurisdictions to stall implementation of cross-border standards. An Aug. 30 letter obtained by American Banker from a group of 15 large banks based in the European Union — including Barclays, the Royal Bank of Scotland, Societe Generale, Santander, Deutsche Bank and HSBC — urges European Commission Vice President Vladis Dombrovskis to broadly reconsider the applicability of certain capital and liquidity rules to EU-based banks.

 New threat in reg reform fight: Exam fees - Banks’ pursuit of regulatory relief has already been fraught, but now even an apparent legislative success is sparking fears about a potentially painful side effect of the reg reform package.On Thursday, the House passed an appropriations bill that on the surface advanced several key regulatory relief provisions that the industry has sought. But a closer look reveals a measure that many say could open the door to higher examination fees, particularly for state-chartered banks that still must answer to a federal supervisor.The bill would subject the federal bank regulators to congressional appropriations, a reform that would place new restrictions on the agencies’ budgeting and could force them to have to seek higher revenue. While there is some debate over just how explicit the bill is about charging exam fees, and the Senate is still unlikely to take up any regulatory relief bill, state regulators and community banks have sounded the alarm.  “I’m totally opposed to any new type of regulatory fee,” said Mick Thompson, Oklahoma's state banking commissioner. Exacerbating concern is that the House bill appears to exempt credit unions from any fee hike, since credit unions successfully lobbied to exempt the National Credit Union Administration from the congressional appropriations process."It should not include banks and exempt credit unions. If they’re going to do it, everyone should be on the same playing field,” Thompson said. Similar provisions were passed in June when the House approved the Financial Choice Act, the broad regulatory relief package sponsored by House Financial Services Committee Chairman Jeb Hensarling, which also sought to put the federal regulators onto appropriations.

 Treasury to release regulatory review of capital markets in October (Reuters) - A top Treasury Department official said on Monday the agency’s review of regulations on capital markets and derivatives will be released in October. Craig Phillips, who is leading the Treasury’s efforts to revisit existing rules as a counselor to Secretary Steven Mnuchin, said the next report will focus on capital markets and derivatives. Market expectations had been that the report would be out in September. Specifically, Phillips said the upcoming report will include recommendations for how to improve access to equity capital, make U.S. markets more competitive, as well as equity and fixed income market structure. The report will also look into how to “properly calibrate” rules imposed on the derivatives market. He spoke at a conference hosted by International Swaps and Derivatives Association.  The report will be the second of four the agency is expected to release that will reexamine existing financial regulations.

Hack of SEC May Have Yielded Illicit Trading Gains - Jerri-lynn Scofield - Securities and Exchange Commission (SEC) chair Jay Clayton announced late yesterday that the agency’s Electronic Data Gathering, Analysis and Retrieval (EDGAR) filing system had been breached last year. Only last month did the agency realize that the vulnerability “may have provided the basis for illicit gain through trading.”  Oops. The agency is investigating who may have profited, but has not released any details about exactly what information was gleaned and which companies were concerned. To elaborate (from Clayton’s statement):Specifically, a software vulnerability in the test filing component of the Commission’s EDGAR system, which was patched promptly after discovery, was exploited and resulted in access to nonpublic information. It is believed the intrusion did not result in unauthorized access to personally identifiable information, jeopardize the operations of the Commission, or result in systemic risk. An internal investigation was commenced immediately at the direction of the Chairman.The SEC announcement follows recent revelations of the massive data breach at Equifax– in which confidential personal financial information for 143 million individuals was exposed– and raises further concerns about the parlous state of cybersecurity for information collected by private and public entities alike. Clayton’s remarks coincided with release of a broader SEC Statement on Cybersecurity, which described the EDGAR system:  In 2017, on a typical day, investors and other market participants access more than 50 million pages of disclosure documents through the EDGAR system, which receives and processes over 1.7 million electronic filings per year. As Bloomberg observes: [EGDAR]  houses millions of filings on corporate disclosures ranging from quarterly earnings to statements on mergers and acquisitions. Infiltrating the SEC’s system to review announcements before they are released publicly would serve as a virtual treasure trove for a hacker seeking to make easy money. Wednesday’s announcement makes clear that the SEC’s efforts to safeguard information from hackers and cyber thieves is inadequate– a failing that has previously subjected the agency to outside criticism. As The New York Times reports: The 27-page report by the Government Accountability Office found the SEC did not always fully encrypt sensitive information, used unsupported software, failed to fully implement an intrusion detection system and made missteps in how it configured its firewalls, among other things.

SEC Hacked: Information From Breach May Have Been Used in Trading - The United States Securities and Exchange Commission (SEC), the government agency that regulates the financial sector, announced Wednesday that its systems were breached by hackers and information stolen from the commission may have been used for insider trading.SEC Chairman Jay Clayton said hackers were able to infiltrate the SEC's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system—a sizable database that maintains information and documentations from official company filings and past financial records.According to Clayton, the hackers were able to exploit a vulnerability discovered in a test filing component of EDGAR that allowed the attackers to gain access to the backend of the SEC’s system. Much of the information housed in EDGAR is already publicly available, but the attackers were also able to access nonpublic information that may have been used to facilitate illegal trading to benefit the attackers or sold to other parties for potentially illegal uses. The SEC said the exploit was quickly patched after discovery and the unauthorized access is not believed to have resulted in the compromise of any personally identifiable information and does not jeopardize the operations of the commission. According to the SEC, there is no systemic risk associated with the breach.“Cybersecurity is critical to the operations of our markets and the risks are significant and, in many cases, systemic,” Chairman Clayton said in a statement. “We must be vigilant. We also must recognize—in both the public and private sectors, including the SEC—that there will be intrusions, and that a key component of cyber risk management is resilience and recovery.”While the commission has does its best to quell concerns stemming from the breach, the timeline related to the hack does not appear promising. The SEC doesn’t give a specific timeframe for when the breach occurred but notes it was first discovered in May 2016 and patched upon its discovery. That breach was not disclosed until Wednesday. What prompted the SEC to suddenly detail the breach that took place more than one year ago was a revelation last month that information stolen as a result of that breach “may have provided the basis for illicit gain through trading.”

SEC Admits US Public Filing System Was Hacked, "May Have Resulted" In Countless Illegal Profits - Over two years ago, on an otherwise uneventful Thursday in May 2015, shares of Avon Products suddenly jumped 20% leaving investors stunned. The catalyst was quickly discovered: a filing recently uploaded to Edgar, the SEC’s public filings database and purportedly from London-based “PTG Capital”, claimed that the "private-equity" firm was bidding to take Avon private. Upon closer inspection, investors noticed a series of glaring, suspicious errors. For one, the document was riddled the spelling mistakes – the firm’s own name, consisting of a three-letter acronym – was repeatedly misspelled.  Investors quickly concluded that the filing was a hoax, and Avon shares crashed back to earth. US authorities eventually blamed it on a Bulgarian hacker who the agency claimed earned a meager profit of $5,000 for his efforts. Now, two years later, the SEC has revealed that the Avon hoax - and possibly a handful of other scams involving fraudulent Edgar filings - was made possible thanks to an "intrusion" into Edgar's test-filing system. According to a statement released overnight by the SEC, the vulnerability that made the Avon hoax possible was discovered in 2016, and quickly patched. But it was only in August that the agency learned the vulnerability had been exploited by criminals, who likely used it to make countless illegal trades, generating an unknown amount of insider-trading profits.  “In August 2017, the Commission learned that an incident previously detected in 2016 may have provided the basis for illicit gain through trading.  Specifically, a software vulnerability in the test filing component of the Commission’s EDGAR system, which was patched promptly after discovery, was exploited and resulted in access to nonpublic information. It is believed the intrusion did not result in unauthorized access to personally identifiable information, jeopardize the operations of the Commission, or result in systemic risk. An internal investigation was commenced immediately at the direction of the Chairman.” 

Hack of Wall St regulator rattles investors, lawmakers (Reuters) - Wall Street’s top regulator came under fire on Thursday over its cyber security and disclosure practices after admitting hackers had breached its database of corporate announcements in 2016 and may have used it for insider trading. The breach involved the U.S. Securities and Exchange Commission’s EDGAR filing system, which houses market-moving information with millions of filings ranging from quarterly earnings to statements on acquisitions. The SEC said on Wednesday evening it discovered in August that cyber criminals might have used a hack detected in 2016 to make illicit trades. On Wednesday afternoon, SEC Chairman Jay Clayton gave members of Congress a “courtesy call” about the hack before it was announced publicly, said Representative Bill Huizenga, chairman of the U.S. House subcommittee that oversees the SEC, in a phone call. “It’s hugely problematic and we’ve got to be serious about how we protect that information as a regulator,” Huizenga said. The SEC disclosure came two weeks after credit-reporting company Equifax Inc said a breach had exposed sensitive personal of data up to 143 million U.S. customers. This followed last year’s cyber attack on SWIFT, the global bank messaging system. It is particularly embarrassing for the SEC and its new boss Clayton, who has made tackling cyber crime one of the top enforcement issues. “The chairman obviously recognizes the irony of the SEC potentially serving as the unwitting tipper in an insider trading scheme,” said John Reed Stark, president of a cyber consulting firm and a former SEC staff member.The SEC has said it was investigating the source of the hack but did not say exactly when it happened or what sort of non-public data was retrieved.  “People are shocked and disappointed,” LaBranche said. Members of the institute, who work with 1,600 publicly traded companies, will be examining their trading reports for any unusual activity that could be tied to disclosures, he said. 

The Equifax fiasco is a classic case of ‘weapon of math destruction’ WaPo - I hadn’t paid much attention to credit-scoring until Equifax erupted. But when I focused on it, it became clear to me that the system, featuring Equifax, Experian and TransUnion as its Big Three, is more than a little outrageous. The troika’s computers receive information about us from who knows where and send it to outfits that we may or may not have given permission to check us out. Using their algorithms and data that might or might not be accurate, the Big Three assign credit scores to us. If there’s a mistake somewhere, which has been known to happen, the victim has to expend time and effort to figure out what’s wrong, and then convince the credit raters that they messed up. And if you want to protect yourself from problems that these firms may cause you, you’ve got to fork over fees to them. The Big Three get paid going and coming. When they mess up, they apologize — but you bear the bulk of the risk and the cost. For example, if you’re concerned that you’ll be victimized by the Equifax hack, you can have Equifax freeze your account. After getting some bad PR, Equifax finally agreed not to charge you the $10 or so — the cost varies by state — for the first frozen year. Big whoop.But if you’re really concerned, you also have to buy protection from Experian and TransUnion, which haven’t waived their fees. And you have to deal with all sorts of paperwork. If your household consists of two adults, like mine does, each of you has to do this. In other words, you, rather than Equifax, have to pay most of the cost to protect yourself from problems Equifax may have caused you.  And it gets better — or worse, depending on your point of view. If after freezing your accounts, you do something that requires you to let a credit card issuer or a potential employer or some other entity have access to your credit information, you have to pay to have your accounts unfrozen. Then you have to freeze them again.

The learned helplessness of Equifax - It is well understood by every adult American that you must keep your nine-digit Social Security Number absolutely secret, lest someone use it to open accounts in your name and ransack your name, your credit, and your sacred honor. There is a real learned helplessness to this: Americans just take it for granted that this is the way things work, it is the way things have always worked, it is the way things always will work. If your SSN and a few personal details get hacked, as with Equifax, apparently because it negligently leaving its server software unpatched for two months — that’s it, you’re screwed.This is, of course, completely insane. “But what else could we do?” you might ask. “It’s not realistic for credit rating companies, the grimdark apotheosis of surveillance capitalism, to actually verify someone’s identity before someone opens a new account in their name. Not if that someone has their social security number! What else could possibly be done?” What if I told you that the credit rating companies already had a system to verify identities before opening new accounts — but, because this would be a minor inconvenience, and a drag on their profits, they only allow this status to last for 90 days for any given account unless a police report can be filed, and furthermore, while they may claim that they’ll do this, it’s not actually a legal requirement? From a Krebs on Security piece from 2015 (as ever, Krebs is two years ahead of the zeitgeist):With a fraud alert on your credit file, lenders or service providers should not grant credit in your name without first contacting you to obtain your approval — by phone or whatever other method you specify when you apply for the fraud alert … Fraud alerts only last for 90 days, although you can renew them as often as you like. More importantly, while lenders and service providers are supposed to seek and obtain your approval before granting credit in your name if you have a fraud alert on your file, they’re not legally required to do this.

How badly did Equifax breach damage the Social Security system? - Millions of Americans are worried that their credit information and Social Security numbers may have been among the 143 million records breached in an unprecedented hack that attacked Equifax, the credit reporting company. But there’s more to the story. While Equifax and the Social Security Administration aren’t talking about it, Equifax was also hired a year ago, on a $10 million contract, to “help the SSA manage risk and mitigate fraud for the mySocialSecurity system, a personalized portal for customers to access some of SSA’s services such as the online statement.”  That’s how the company put it in a press release on Feb. 10, 2016. In that announcement, Equifax also boasted that the Social Security Administration “has completed integration with Equifax Inc.” Despite Equifax’s self-described intimate role in providing security and preventing fraud on the Social Security System’s public access website for current workers and beneficiaries, there has been no indication that the Social Security Administration is concerned about whether weaknesses in Equifax’s own customer portal security — such as the Apache tool on which the company is blaming the breach — might have been involved in its security work for the mySocialSecurity portal. Efforts by Salon to ascertain the extent of Equifax’s actual work on the construction and operation of the SSA portal, or what if anything the SSA has done in the wake of its contractor’s security breach to protect that portal’s security, met with no success. Chief public information officer Mark Hinkle wrote in an email reply that Social Security, not Equifax, “runs the mySocialSecurity portal.” But when asked whether the SSA was concerned about whether any weaknesses in Equifax’s own security system may have been introduced into the security system and protocol the company set up for the mySocialSecurity portal — and also when asked when the SSA was informed by Equifax about its security breach (when it happened in mid-July? or six weeks later when the company went public with the news?), Hinkle said the agency would have no comment.

Consumers, but Not Executives, May Pay for Equifax Failings - Gretchen Morgenson, NYT - Equifax investors are also shouldering the burden associated with the company’s apparently lax security practices. Since disclosing the breach, Equifax’s stock has fallen 35 percent, losing its shareholders almost $6 billion in market capitalization.  It remains unclear, though, whether the company’s executives will take a financial hit for the failures that allowed thieves to steal Social Security numbers, driver’s license numbers and other sensitive data. Indeed, Equifax’s top managers may not feel any financial ill effects, given the company’s past compensation practices.  Over the last three years, when Equifax determined its top executives’ incentive compensation, it has used a performance measure that excluded the costs of legal settlements made by the company. If it follows this practice after dealing with the costs of settling legal claims arising from the security breach, Equifax’s top managers will essentially escape financial accountability for the blunder. This troubles Charles M. Elson, a professor of finance at the University of Delaware and the director of its John L. Weinberg Center for Corporate Governance. “To the investors in the company, the legal settlement does impact earnings and stock price,” Mr. Elson said in an interview. “If the shareholders suffer because of this breach, why should management be excluded? These folks take home all of the upside and want none of the down.”  Equifax is not alone in excluding certain costs of doing business from the financial factors it uses to determine executive pay. Such practices have become prevalent among large United States companies.

Equifax Stock Sales Are the Focus of U.S. Criminal Probe -- The U.S. Justice Department has opened a criminal investigation into whether top officials at Equifax Inc. violated insider trading laws when they sold stock before the company disclosed that it had been hacked, according to people familiar with the investigation. U.S. prosecutors in Atlanta, who the people said are looking into the share sales, said in a statement they are examining the breach and theft of people’s personal information in conjunction with the Federal Bureau of Investigation. The Securities and Exchange Commission is working with prosecutors on the investigation into stock sales, according to another person familiar with the matter. The federal probes add a serious challenge to Equifax as lawmakers, state attorneys general and regulators scrutinize the breach that may have compromised the privacy of 143 million U.S. consumers. Equifax shares were little changed. The shares have fallen 35 percent since the breach was disclosed after market close in New York on Sept. 7.Investigators are looking at the stock sales by Equifax’s chief financial officer, John Gamble; its president of U.S. information solutions, Joseph Loughran; and its president of workforce solutions, Rodolfo Ploder, said two of the people, who asked not to be named because the probe is confidential. The company and the executives didn’t immediately respond to requests for comment.

Equifax Confirms Another ‘Security Incident’ - Equifax is already struggling to regain public trust after it waited at least a month to disclose to consumers that the cyberattack potentially impacted their personal information, such as names, Social Security numbers, birth dates, addresses and, in some cases, driver's license numbers and credit card information. "Earlier this year, during the 2016 tax season, Equifax experienced a security incident involving a payroll-related service," an Equifax spokesperson told NPR. "The incident was reported to customers, affected individuals and regulators. This incident was also covered in the media." The company spokesperson disputes a Bloomberg report released Monday, where an unnamed source "said the breaches involved the same intruders." The company adds that the same security company, Mandiant, "has investigated both events and found no evidence that these two separate events or the attackers were related." Equifax's spokesperson characterizes this second breach as the "March event." However, it appears that the incident in question may have lasted considerably longer than a single month. When asked for information about previous media coverage, Equifax pointed NPR to coverage in KrebsonSecurity.

 More Equifax Lies? Company Originally Hacked Five Months Earlier Than It Disclosed --When Equifax first disclosed the shocking news on September 7 that its servers and some 143 million private account had been hacked, leaking everything from names, to addresses, to social security numbers, it stated in its press release that it had "learned of the incident on July 29, 2017" adding that "at which point it reported the intrusion to law enforcement and contracted a cybersecurity firm to conduct a forensic review: based on the company’s investigation, the unauthorized access occurred from mid-May through July 2017."As we commented then, it "oddly enough took shareholders and over a third of America, more than a month longer to learn that all their personal data may have been compromised."And now, according to Bloomberg, it appears the company had lied again as it wasn't "only one month" but nearly six that the company was aware of the hacking without doing anything on it, to wit:Equifax Inc. learned about a major breach of its computer systems in March -- almost five months before the date it has publicly disclosed, according to three people familiar with the situation.  While the March breach was reportedly not related to the hack that exposed the personal and financial data on 143 million U.S. consumers, "one of the people said the breaches involve the same intruders. Either way, the revelation that the 118-year-old credit-reporting agency suffered two major incidents in the span of a few months adds to a mounting crisis at the company, which is the subject of multiple investigations and announced the retirement of two of its top security executives on Friday." That one of the top security executives also happened to be a music major who desperately tried to scrub her public background has not helped the company's case.Some further details from Bloomberg: Equifax hired the security firm Mandiant on both occasions and may have believed it had the initial breach under control, only to have to bring the investigators back when it detected suspicious activity again on July 29,two of the people said. Equifax’s hiring of Mandiant the first time was unrelated to the July 29 incident, the company spokesperson said. Vitor De Souza, senior vice president for global marketing at FireEye Inc., Mandiant’s parent company, declined to comment.

Apache Struts Vulnerability: More Than 3,000 Organizations At Risk Of Breach - More than 3,000 organizations could be at risk of suffering an attack against the same vulnerability that allowed hackers to gain access to the records of more than 143 million Americans from credit reporting firm Equifax. The troublesome figure comes from supply chain automation firm Sonatype, which found a total of 3,054 organizations still using a vulnerable version of Apache Struts, a popular web application framework. Sonatype analyzed data available through the Maven Central repository, the largest distribution point for Java open-source components (of which Apache Struts is one) and found a surprising amount of organizations continuing to use an application with an exploit that has been used in breaches in the past—even prior to the Equifax incident. The vulnerability in question is CVE-2017-5638, which was first discovered in March of this year and was considered a zero-day—an exploit that could be attacked because the software maker was unaware of it or had yet to address it with a patch or fix. Once the vulnerability was made public, attackers started targeting organizations that failed to quickly patch the exploit. Researchers at Cisco Systems deemed the vulnerability to be critical and noted a “high number of exploitation events” making use of the bug. In one instance, a malicious group used the Apache Struts exploit to install Cerber ransomware on a number of locally networked machines. That endeavor ended up netting the hacking group more than $100,000 in Bitcoin. While those attacks happened in the immediate aftermath of the disclosure of the vulnerability, Equifax was hit two months after the patch was made available. The hack that resulted in personal information, credit cards, and Social Security numbers of hundreds of thousands if not millions of U.S. consumers occurred in May and wasn’t discovered until July 29.

 Senate Dem's Equifax bill may gain surprising bipartisan support — Senate Democrats' legislative bid to reform the credit reporting industry following the massive data breach at Equifax may have traction in the Republican-controlled Congress.Introduced by Sens. Elizabeth Warren, D-Mass., and Brian Schatz, D-Hawaii, the bill is seen by analysts as tempered and balanced, which could help it pick up support.Among other things, the bill would create a federal requirement for credit bureaus to offer free credit freezes to consumers affected by a data breach and prevent bureaus from selling consumer information while a freeze is in place. “The bill … seems like a fairly rational, targeted response and something that could be done quickly,” said Carolyn Walsh, a partner at the law firm Steptoe & Johnson. Both Republicans and Democrats have expressed outrage over the Equifax breach, which exposed the personal information of 143 million consumers, she noted.The bill might even pass soon if it were attached to a spending bill that Congress will have to address in December.“Despite Elizabeth Warren's status as a leader of progressive Democrats, we could see this bill picking up bipartisan support” or it “could resurface in a broader bill that enjoys bipartisan support,” Jaret Seiberg, an analyst at Cowen Research, wrote in a note to clients.However, others who favor reforming the industry said it may not be that easy. “The economic incentives of credit bureaus to treat consumers fairly have always been warped,” said Aaron Klein, policy director of the center on regulation and markets at the Brookings Institute. “Reform of credit bureaus and credit reporting could increase economic growth, but would require serious political will.”

AG Maura Healey Suing Equifax After Data Breach  - Massachusetts Attorney General Maura Healey’s office announced Tuesday that it is suing credit reporting firm Equifax over the data breach that left millions of their customers’ personal information vulnerable. The data breach exposed the information of about 143 million Americans from May to July–nearly three million of them from Massachusetts. Healey’s suit alleges the company didn’t do enough to protect that information. “We allege that Equifax knew about the vulnerabilities in its system for months, but utterly failed to keep the personal information of nearly three million Massachusetts residents safe from hackers,” Healey said in a release. “We are suing because Equifax needs to pay for its mistakes, make our residents whole, and fix the problem so it never happens again.” Healey’s office launched an investigation into the breach last week. The company, which is based in Atlanta, said earlier this month that “criminals” exploited their site to access customers’ names, Social Security numbers, birth dates, addresses, and drivers’ license numbers–as well as credit card numbers for about 209,000 customers. The hackers likely stole that information.  “Although fixes for the computer code vulnerability were available to Equifax and posted on at least one U.S. Government website, the company failed to implement the recommended fixes, or otherwise put in place other safeguards and security controls, such as encryption, that would sufficiently protect consumers’ personal data,” Healey’s office said. According to Healey’s lawsuit, Equifax also didn’t notify the AG’s office or the affected Massachusetts customers in a timely manner–finding out about the breach on July 29 but not telling customers or the AG’s office until September 7. The suit is seeking “civil penalties, disgorgement of profits, restitution, costs, and attorney’s fees,” as well as ways to protect customers whose information may have been stolen in the breach.

Bill Black: Massachusetts First to Sue Equifax Over Massive Hack - Jerri-lynn Scofield: Several government agencies and at least 34 state attorneys general have opened probes into the Equifax data-breach scandal--'the gift that keeps on giving,' says Bill Black. In this Real News Network interview, white collar criminologist Bill Black discusses the state of play with respect to legal investigations, both federal and state, into the Equifax data-breach fiasco. (w/ transcript)

What retirees should do in wake of Equifax data breach -  Millions of people, roughly 143 million Americans, were affected by the Equifax EFX, +0.60%  data breach.And some of those millions were retirees. The internet is filled with advice today about what consumers should do now. But are there things that retirees should do or consider to protect their identity that are different from those not yet retired? “Yes, retirees need to take extra steps to protect their life savings,” said Elizabeth Loewy, general counsel and senior vice president of industry relations at EverSafe, an identity theft protection service. Others agree. “(The Equifax breach) is an indication that you are only as safe as the places that hold your personal information with the weakest security,” said Steven Weisman, a lawyer, founder of scam alert and education website Scamicide, and author of ”Identity Theft Alert”. “The advice that is being given to everyone who may be affected by the data breach to freeze your credit at each of the three major credit reporting agencies is good advice for retirees as well as non-retirees.”  Fraud alerts are worthless and often ignored by companies issuing credit without any kind of penalty, according to Weisman.  Most folks are aware of the credit alert and credit freeze options, at this point, Loewy said, and many seniors are considering whether this makes sense for them. “But if a consumer’s data was stolen in May of 2017 and exposed until the breach was discovered in late July, it’s possible that damage was done before the breach was publicized in September,” she said. “If fraud and identity theft monitoring was in place before the breach, the senior should have been notified if there was suspicious activity affecting their financial accounts and/or their credit report.”

Someone Made a Fake Equifax Site. Then Equifax Linked to It. Equifax’s website about its breach of customer information, left, and a fake version, right, that a software engineer created to draw attention to the company’s lax cybersecurity. People create fake versions of big companies’ websites all the time, usually for phishing purposes. But the companies do not usually link to them by mistake. Equifax, however, did just that after Nick Sweeting, a software engineer, created an imitation of equifaxsecurity2017.com, Equifax’s page about the security breach that may have exposed 143 million Americans’ personal information. Several posts from the company’s Twitter account directed consumers to Mr. Sweeting’s version, securityequifax2017.com. They were deleted after the mistake was publicized. By Wednesday evening, the Chrome, Firefox and Safari browsers had blacklisted Mr. Sweeting’s site, and he took it down. By that time, he said, it had received about 200,000 hits. Fortunately for the people who clicked, Mr. Sweeting’s website was upfront about what it was. The layout was the same as the real version, complete with an identical prompt at the top: “To enroll in complimentary identity theft protection and credit file monitoring, click here.” But a headline in large text differed: “Cybersecurity Incident & Important Consumer Information Which is Totally Fake, Why Did Equifax Use A Domain That’s So Easily Impersonated By Phishing Sites?” It would be just as easy for phishers to create their own versions of the Equifax page, and that would be bad news for anyone entering the information required to enroll in identity theft protection: their surname and the last six digits of their Social Security number. (In Mr. Sweeting’s version, the form was disabled so that no information was saved.)  

Equifax Accidentally Directs 200,000 Customers To Fake Phishing Website - And the hits just keep coming for Equifax, the once-trusted credit-monitoring firm that has been embroiled in one of the biggest corporate public-relations disasters in recent memory since disclosing that hackers had penetrated its cyber security defenses and absconded with sensitive personal and financial data belonging to 143 million Americans. Because of the types of data that were stolen, including drivers' license, social security and credit-card numbers, experts have described the hack as possibly the most damaging corporate hack yet.As if this weren’t enough to permanently sully the firm’s reputation (amid cries of “you had one job!”) – the staggering irony of a credit monitoring firm inadvertently divulging the sensitive information that it was supposed to safeguard hasn’t been lost on consumers) a series of subsequent disclosures have portrayed the firm’s executives as bungling, at best, and nefarious, at worst. In the nearly two weeks since the story broke…

  • It was revealed that three of the firm’s executives, including its CFO, cashed out of stocks and options worth some $2 million in the month between when the company first learned about the hack, and when it was disclosed to the public. A federal prosecutor in Atlanta has opened a criminal investigation into Equifax that will focus both on whether the firm was criminally negligent in failing to patch a hole in its cybersecurity systems, as well as whether the suspect stock sales constitute securities fraud.
  • The company’s head of cyber security was revealed to have no background in computer science or security – a fact the company tried to hastily cover up by scrubbing her social-media profiles. Susan Mauldin,Equifax’s chief information security officer, has a bachelor’s degree in music composition and a master’s in fine arts from the University of Georgia.
  • Several Congressional committees have asked the company to turn over information relating to the hack as multiple investigations appear to be getting under way. The attorneys general of a handful of states, including Massachusetts and Rhode Island, have joined a probe into the company’s handling of the breach.
  • The company has been hit with dozens of lawsuits from consumers alleging fraud, abuse and negligence.
  • Equifax CEO Rick Smith has been called to testify before a special House panel early next month.

When Equifax first set up a website to allow consumers to check whether their information was compromised, it carried a waiver stating that by using the service consumers would forfeit the right to sue Equifax. The internet quickly exploded in outrage, and the company quickly clarified that the waiver didn’t apply to this hacking incident, which…sure. Now, The Verge, The New York Times and a handful of other media outlets are reporting that Equifax accidentally tweeted the link to an imposter website set up by a white-hat hacker hoping to expose gllaring errors that the firm had made in setting up its verification website. This happened not once, but three times. And in at least one instance, the tweet with the phony link was left up for a whole day.

Equifax Has Been Sending Consumers to a Fake Phishing Site for Almost Two Weeks. -  Equifax’s response to its data breach has been a total shitshow, something the company seems determined to remind us of each and every day. For nearly two weeks, the company’s official Twitter account has been directing users to a fake lookalike website, the sole purpose of which is to expose Equifax’s reckless response to the breach. After announcing the breach, Equifax directed its customers to equifaxsecurity2017.com, a website where they can enroll in identity theft protection services and find updates about how Equifax is handing the “cybersecurity incident.” But the decision to create “equifaxsecurity2017” in the first place was monumentally stupid. The URL is long and it doesn’t look very official—that means it’s going to be very easy to emulate. Fake versions of the site could be used to phish Equifax customers and steal their personal information, again. A much safer choice would have been to create a subdomain on the Equifax website (equifax.com) and direct users there.To illustrate how idiotic Equifax’s decision was, developer Nick Sweeting created a fake website of his own: securityequifax2017.com. (He simply switched the words “security” and “equifax” around.) Sweeting’s website looks slightly different than the official Equifax website, as you can see below, but only because he isn’t actually trying to dupe anyone: Sweeting’s intentions clearly aren’t malicious. If anything, he’s trying to demonstrate why Equifax needs to shut down its website, or at least transfer it elsewhere, so it isn’t further exposing consumers to risk. As if to demonstrate Sweeting’s point, Equifax appears to have been itself duped by the fake URL. The company has directed users to Sweeting’s fake site sporadically over the past two weeks. Gizmodo found eight tweets containing the fake URL dating back to September 9th: Each of the tweets containing Sweeting’s URL is signed by someone at Equifax named “Tim.” The latest tweet was sent out September 19th. (Equifax deleted this tweet Wednesday morning, but at the time of writing the other seven tweets were still live.)

Equifax breach has banks tightening defenses, counseling customers - Asking bankers to comment on the Equifax data breach generally evokes a cone of silence forged out of a combination of sympathy and fear — I’m not going to speak about it because it could happen to me. “Even if you’re really good, stuff can happen,” the chief information officer of a large financial services organization said privately. “I don’t want to throw stones because I also live in a glass house.”A few, though, will acknowledge the toll the breach has taken on their customers and their security departments, which have scrambled to ensure they won’t share (or haven’t shared) Equifax’s fate. “I double-checked that we had that security flaw patched, and we did,” the CIO said, referring to a vulnerability in the Apache Struts web application framework that, according to a press release Equifax issued Friday, hackers exploited to break into the company’s servers and compromise 143 million customer records. Equifax uses the Adobe framework in its U.S. online dispute portal.  Another banker, Jim Hanlon, the chief technology officer at Dedham Savings Bank in Boston, was astounded that Equifax did not catch its breach more quickly. “We have 60,000 customers,” he said. “If somebody came into our network and was looking at 100 files, that would raise a flag with us. If somebody’s accessing millions of records, how is something not alerting them to that fact? That’s the concerning piece to me. The documentation said they take network security seriously. But there should have been a red flag somewhere.”  Equifax's security team detected and blocked suspicious network traffic associated with its U.S. online dispute portal web application on July 29. But the company's investigation found that hackers had access to certain files containing personal information from May 13 through July 30.

Cybersecurity Aint the Only Game in Town: The Scams Multiply --Jerri-lynn Scofield -Cybersecurity has been much in the news this month, as Equifax and the Securities and Exchange Commission (SEC) have both been hacked, victims of scams.To recap: Equifax announced that a hack had compromised the data of more than 140 million consumers, while the Securities and Exchange Commission (SEC) has admitted to acting as an inadvertent tipper of insider information illicitly obtained from its EDGAR filing system. (See Yves here on Equifax, and my post yesterday here for the SEC.)So one can be forgiven for thinking of the internet as a major if not the sole locus of today’s scams problem.The Wall Street Journal yesterday ran a jaunty– albeit a bit hair-raising– interview with Frank Abagnale Jr.– the subject of the biopic 2002 Catch Me if You Can‘Catch Me if You Can’ Scam Artist Has a Warning for Today’s Consumers that says it ain’t so.Once a top class scam artist– successfully posing as pilot, doctor, and lawyer– before getting caught, doing five years’ time– Abagnale and has subsequently spent the last forty years as a security consultant, advising the FBI and others on ways to avoid and counteract scams, particularly those involving cybercrime, fraud, and identity theft.I realize that the interview is paywalled, and for those who don’t have a WSJ subscription, it’s probably too late to buy a copy of yesterday’s paper. So I’m going to share with you a few of Abagnale’s thoughts, and some more of my own.

 Warren targets Equifax investor disclosure, board’s clawback powers — Sen. Elizabeth Warren, D-Mass., is broadening her probe into the Equifax data breach to look at whether the credit bureau should have disclosed the breach sooner than it did and if the company plans to claw back compensation from key executives.Warren sent a letter Friday to Securities and Exchange Commission Chairman Jay Clayton, asking him to investigate whether Equifax broke the law by not disclosing the breach in an Aug. 16 investor presentation despite having discovered weeks earlier, on July 29, that hackers had broken into the company’s computer system. The company ultimately disclosed the breach on Sept. 7. She also noted that, by the time of that presentation, Equifax had already hired a top-tier security firm to investigate the hack, which exposed personal data on 143 million consumers and led to a 30% drop in the company’s stock price. "Investors who believed Equifax's August 16th presentation was complete and accurate would have suffered enormous losses if they decided to invest in the company on the basis of the presentation," Warren wrote.  Warren also inquired separately about the Equifax board's powers to claw back compensation. She and Sen. Catherine Cortez Masto, D-Nev., sent a letter to Robert Marcus, chairman of the board's compensation committee, asking if directors planned to claw back pay from Chief Information Officer David Webb and Chief Information Security Officer Susan Mauldin. Both executives retired on Sept. 15, roughly a week after the data breach was made public.

Lawmakers to grill Equifax, Wells CEOs in busy week of hearings — Equifax CEO Richard Smith and Wells Fargo CEO Tim Sloan are scheduled to testify on major operational breakdowns at both companies before Senate lawmakers during the first week of October.The Senate Banking Committee announced Thursday that it would hold a hearing Oct. 3 on Wells Fargo's phony-accounts scandal, which was first revealed by regulators a year ago. The hearing, "Wells Fargo: One Year Later," will feature Sloan as its sole witness.A day later, the panel said, it will tackle Equifax's massive data breach, which compromised information on 143 million consumers, with Smith as the sole witness. The hearings have high stakes for both companies. Last year, then-Wells CEO John Stumpf's performance at hearings was widely panned and likely played a role in his eventual resignation from the company. Since then, the news for Wells has only worsened. The bank disclosed that the number of customers potentially affected by the scandal was 3.5 million, up from its initial estimate of 2 million. And other problems have come to light, including allegations that the bank charged customers for auto insurance they didn't need.Sen. Elizabeth Warren, D-Mass., a member of the Banking Committee, has also been pressing the Federal Reserve Board to fire members of Wells' board of directors who were present when the scandal occurred. But Smith will also face a big test. The Equifax breach has drawn bipartisan condemnation because of the volume of data stolen and how many consumers were affected. Smith is likely to face questions on why it took six weeks for the public to be notified of the breach and about its initial use of arbitration agreements for customers signing up for Equifax's credit monitoring service.

 Yellen signals Wells may face more actions  — Federal Reserve Chair Janet Yellen strongly hinted that more regulatory penalties against Wells Fargo may be forthcoming related to its phony-accounts scandal, saying its activities were beyond the pale. “Let me say that I consider the behavior of Wells Fargo toward its customers to have been egregious and unacceptable,” Yellen said during a press conference Wednesday. “We take our supervision responsibilities of the company very seriously. And we are attempting to understand what the root causes of those problems are and to address them.” Yellen added that she could not discuss the details of the Fed’s investigation or what actions it may take in the future because it is confidential supervisory information. But she said the Fed is “committed to taking the actions we regard as necessary and appropriate to make sure the right set of controls are in place in that organization.”Yellen’s remarks build on earlier criticism she lobbed at the bank, which was discovered to have a widespread scandal, with bank employees creating new accounts for existing customers without their knowledge. The issues led to $190 million in fines and restitution by federal regulators last year and a public relations headache for the bank, causing the ouster of its CEO and a more recent shake-up of its board of directors. Yellen said during her testimony in the Senate Banking Committee in July that the Fed and other regulators are conducting their own investigation of Wells and that it could lead to additional penalties against the bank. Panel member Elizabeth Warren, D-Mass., has called on the Fed to fire all members of Wells’ board who were present during the scandal, though Yellen has maintained that she has no predetermined outcomes in mind.

Why are more people trying to rob banks? --Violent bank crime has become increasingly less common in the past decade, but the rate of robberies has ticked back up in recent years. The nationwide opioid crisis may be a leading factor, an industry expert said. In its latest report on crime at banks and credit unions, the Federal Bureau of Investigation said that the number of incidents in which perpetrators used a firearm fell 68% last year compared with a decade earlier. Further, there were fewer fatalities during robbery attempts in 2016 — eight, down from 13 in 2006 and 21 in 2005, the FBI said. Violent crime has dropped for several reasons, including the widespread use of bullet-resistant glass, improved tracking technologies and greater cooperation among financial institutions that have been victims of crime, according to industry consultants and the American Bankers Association.The overall crime rate is another story. Bank crime rates reached a 10-year high in 2006, with a total of 7,272 violations recorded nationwide, including robberies, burglaries and incidents of larceny. The number started steadily dropping in 2007 and reached a low of 3,961 in 2014. However, the rate has risen each of the last two years, hitting a total of 4,251 in 2016.Joseph Giacalone, a retired New York City detective who now teaches at John Jay College of Criminal Justice, said he suspects that the national surge in opioid addiction is fueling the rise. In an analysis conducted by the health care insurer Blue Cross Blue Shield, the number of people diagnosed with an opioid addiction rose 493% between 2010 and 2016.“If you’ve got a perpetrator with a heroin problem, he’s going to be desperate,” Giacalone said. “They’re looking for the easiest thing they can find” to get money to fuel their habit.

Jamie Dimon Faces Market Abuse Claim Over "False, Misleading" Bitcoin Comments --A week after Jamie Dimon made headlines by proclaiming Bitcoin a "fraud" and anyone who owns it as "stupid," the JPMorgan CEO faces a market abuse claim for "spreading false and misleading information" about bitcoin.Unless you have been living under a rock for the past week, you will be well aware ofJPMorgan CEO Jamie Dimon's panicked outburst with regard the 'fraud' that Bitcoin's 'tulip-like' bubble is. To paraphrase: "It’s a fraud. It’s making stupid people, such as my daughter, feel like they’re geniuses. It’s going to get somebody killed. I’ll fire anyone who touches it." One week later, an algorithmic liquidity provider called Blockswater has filed a market abuse report against Jamie Dimon for "spreading false and misleading information" about bitcoin.The firm filed the report with the Swedish Financial Supervisory Authority against JPMorganChase and Dimon, the company's chief executive. Blockswater said Dimon violated Article 12 of the European Union's Market Abuse Regulation (MAR) by declaring that cryptocurrency bitcoin was "a fraud".The complaint said Dimon's statement negatively impacted "the cryptocurrency's price and reputation".It also said Dimon "knew, or ought to have known, that the information he disseminated was false and misleading"."Jamie Dimon's public assertions did not only affect the reputation of bitcoin, they harmed the interests of some of his own clients and many young businesses that are working hard to create a better financial system,” said Florian Schweitzer, managing partner at Blockswater.Blockswater said JPMorgan traded bitcoin derivatives for their clients on Stockholm-based exchange Nasdaq Nordic before and after Dimon's statements (as we detailed here), whichSchweitzer said "smells like market manipulation".   Blockswater works with blockchain-based assets based in London and Austria. Its full complaint is below:

Central bank cryptocurrencies -- Bank for International Settlements -- In less than a decade, bitcoin has gone from being an obscure curiosity to a household name. Its value has risen - with ups and downs - from a few cents per coin to over $4,000. In the meantime, hundreds of other cryptocurrencies - equalling bitcoin in market value - have emerged (Graph 1, left-hand panel). While it seems unlikely that bitcoin or its sisters will displace sovereign currencies, they have demonstrated the viability of the underlying blockchain or distributed ledger technology (DLT). Venture capitalists and financial institutions are investing heavily in DLT projects that seek to provide new financial services as well as deliver old ones more efficiently. Bloggers, central bankers and academics are predicting transformative or disruptive implications for payments, banks and the financial system at large.2 Lately, central banks have entered the fray, with several announcing that they are exploring or experimenting with DLT, and the prospect of central bank crypto- or digital currencies is attracting considerable attention. But making sense of all this is difficult. There is confusion over what these new currencies are, and discussions often occur without a common understanding of what is actually being proposed. This feature seeks to provide some clarity by answering a deceptively simple question: what are central bank cryptocurrencies (CBCCs)? To that end, we present a taxonomy of money that is based on four key properties: issuer (central bank or other); form (electronic or physical); accessibility (universal or limited); and transfer mechanism (centralised or decentralised). The taxonomy defines a CBCC as an electronic form of central bank money that can be exchanged in a decentralised manner known as peer-to-peer, meaning that transactions occur directly between the payer and the payee without the need for a central intermediary.3 This distinguishes CBCCs from other existing forms of electronic central bank money, such as reserves, which are exchanged in a centralised fashion across accounts at the central bank. Moreover, the taxonomy distinguishes between two possible forms of CBCC: a widely available, consumer-facing payment instrument targeted at retail transactions; and a restricted-access, digital settlement token for wholesale payment applications.4

 CFPB’s arbitration rule is best defense for ‘wronged’ consumers - When I read the news about the Equifax data breach on my phone last week, I immediately clicked on the company’s link, www.equifaxsecurity2017.com, to find out if my personal data was at risk. It was. What I didn’t realize at the time was that, just by checking on my data, Iforfeited my right to participate in class action lawsuits against Equifax. So much for the “helpful” website Equifax created in response to the problem. Once a few savvy consumers and policymakers, including New York State Attorney General Eric Schneiderman, read the fine print, uproar over the company’s clause ensued. Equifax ultimately clarified that the clauses only related to “the free credit file monitoring and identity theft protection products, and not the cybersecurity incident,” and then the company removed the clause altogether. But Equifax’s initial instinct to protect itself rather than do right by people is part of a real problem that has been getting worse. Consumer financial services firms increasingly require consumers to sign forced arbitration clauses as a condition for using their products and services. If you have ever opened a checking account, signed up for a credit card, or subscribed to a phone service, chances are you have signed away your right to sue the company that is supposed to be serving you.  These clauses — which became commonplace after 2011 and 2013 Supreme Court rulings — are a big problem as they eliminate an important tool for people who have been wronged by financial firms’ illegal practices, such as banks’ high-to-low ordering of debit transactions.   The recent Wells Fargo case is a textbook example of why we need to remove these clauses. Arbitration is litigation without rules performed behind closed doors, and it is rigged to favor corporations. Companies that require arbitration choose, hire and pay the arbitrators — a practice that raises serious questions about their impartiality. Arbitrators’ findings cannot be appealed in most cases. Once in arbitration, a Consumer Financial Protection Bureau study found that businesses won 93% of their claims and counterclaims.

CFPB arbitration rule is an undeniable win for consumers  - In a recent BankThink piece, Attorney Joseph Cioffi questions the benefits of the Consumer Financial Protection Bureau’s recently finalized rule banning mandatory arbitration clauses in most consumer credit and financial agreements.  The rule’s consumer protections, Cioffi suggests, may actually turn out to be bad news for consumers. As he sees it, the rule will lead to more litigation, and therefore, consumers should prepare for higher prices of financial services and products as a result of the rule. Cioffi’s argument on the contentious issue runs thus: If allowed to go into effect, the arbitration rule will unleash trial lawyers to file more class-action lawsuits. At the same time, the Trump administration’s aggressive deregulatory efforts are already unleashing corporations to engage in more bad, or at least, in more controversial behavior. As Cioffi sees it, these two developments mean more lawsuits. In turn, more lawsuits will mean an efficiency drag on producers, which in turn will mean that banks — which determine the prices of products and services, in part, on their own assessment of regulatory and legal risk — will charge consumers more.Yet he also reiterated a much-cited assessment about what consumers reap from class actions. “[E]ven the CFPB's own studies,” Cioffi writes, “show that individuals on average receive less in class actions after legal fees than they do in arbitration.”  That statement is misleading because it focuses on the size of the award while omitting an equally important factor: The justness of the process. Many an injured plaintiff ends up with nothing — not because of a weak case but because the consumer is barred from suing and deterred from pursuing an individual arbitration due to the latter’s perceived rigged nature and/or poor potential payoff. He or she receives nothing, but this outcome is not captured in the data. To be sure, some class-action attorneys do engage in off-putting and even unethical behavior. But that problem can be managed without having to deprive people of their access to court.  Class actions serve a useful purpose and offer unique benefits. As the congressional House Liberty Caucus wrote in a statement on Facebook: “[Class actions] are a market-based solution for addressing widespread breaches of contract” and “a preferable alternative to government regulation because they impose damages only on bad actors rather than imposing compliance costs on entire industries.”Arbitration clauses have become controversial because they have become effectively mandatory, slamming the door on people’s Seventh Amendment right to a civil jury trial. The CFPB’s rule restoring the optional nature of such clauses, for millions of Americans, may be bad news for alleged corporate wrongdoers like Equifax and Wells Fargo, but surely for the victims of such wrongdoing — and for consumers, generally — it is good news indeed.

GOP undeterred on arbitration rule repeal despite Wells, Equifax - – Democrats have striven to paint recent scandals at Wells Fargo and Equifax as prime examples of why a regulatory rule banning mandatory arbitration agreements should be upheld, but Republicans are not wavering on their desire to overturn it.The House has already passed a bill under the Congressional Review Act to repeal the Consumer Financial Protection Bureau rule. But it’s unclear if Republicans in the Senate have the votes, or whether they can find the floor time before their window to act closes. “The clock is ticking and we are very close on votes and I am ready to support a resolution of disapproval,” said Sen. Thom Tillis, R-N.C. The CFPB released the rule in July, which bans the legal clauses that prevent consumers from joining together and filing class-action lawsuits. However, Republicans view the rule as giveaway to trial lawyers who traditionally support Democrats and say it will open up banks and other financial firms to frivolous lawsuits. The GOP is attempting to use an obscure legislative process called the Congressional Review Act to overturn the rule. Under the constraints of the procedure, Republicans have 60 legislative days to reject the rule with a simple majority.

Cordray lied, botched Wells investigation: GOP report - Consumer Financial Protection Bureau Director Richard Cordray allegedly misled Congress about the agency's investigation into Wells Fargo's illegal sales practices and may have rushed a settlement with the bank, according to a new report by the Republican staff of the House Financial Services Committee.  The 32-page report, released Tuesday, says that GOP staff could not corroborate Cordray's claim in congressional testimony that the CFPB was actively investigating Wells' illegal sales practices prior to May 4, 2015, when the Los Angeles city attorney's office filed its complaint against the bank. The report also said that CFPB could have demanded as much as $10 billion from Wells as a result of its phony-accounts scandal, but ultimately settled for $100 million because it wanted to close out the case. The report alleges that the CFPB never conducted its own investigation but rather "relied primarily, if not exclusively, on the PricewaterhouseCoopers" report. "Internal CFPB records obtained by the committee raise grave questions as to whether Director Cordray, other senior CFPB officials, and CFPB oversight attorneys engaged in actions that had the effect of obstructing the committee’s lawful oversight related to the Wells Fargo account scandal," the report stated. That included withholding key information, said the report, which was prepared under the auspices of House Financial Services Committee Chairman Jeb Hensarling. Previous reports by the panel staff have threatened to hold Cordray in contempt for failing to turn over crucial documents. The report appears to be part of an effort by Republicans to prove Cordray lied to Congress in September 2016 and April 2017 when he testified that the CFPB was already tracking Wells’ fraudulent sales practices and had conducted an "independent and comprehensive" investigation. Lying to Congress could be used as a basis for President Trump to fire Cordray "for cause," the legal standard in the Dodd-Frank Act. (A court case challenging that standard, which would allow the president to dismiss a CFPB director at will, is under appeal.)

Allied Home Mortgage hit with $296M False Claims Act judgment -Allied Home Mortgage Corp. was ordered to pay $296 million after a jury found the Texas lender violated the False Claims Act by defrauding the Federal Housing Administration insurance program for over a decade. Jim Hodge, president and CEO of Houston-based Allied, was also ordered to pay $25.3 million. Allied engaged in a "decade of fraudulent misconduct while participating in the Federal Housing Administration mortgage insurance program," Joon Kim, Acting U.S. Attorney for the Southern District of New York, said in a press release."Jim Hodge and Allied defrauded a federal mortgage insurance program designed to help spread the dream of homeownership, and then lied about it repeatedly. A jury saw through their lies, and now the court has imposed millions of dollars in additional penalties," according to the press release.Allied could not be reached for comment as the company's main phone number "is not in service," according to a recording.A jury found that Allied and Hodge violated the False Claims Act and caused over $92 million in damages to the FHA mortgage insurance fund. The False Claims Act allows courts to impose treble damages.PHH Corp. settled a False Claims Act investigation in August by the Justice Department and agreed to pay a $75 million settlement for its underwriting practices on FHA-insured mortgages as wells as Department of Veterans Affairs-insured mortgages and loans sold to Fannie Mae and Freddie Mac.

CFPB reveals what new HMDA data will, and won't, be made public - The Consumer Financial Protection Bureau plans to modify or exclude from public disclosure one-third of the Home Mortgage Disclosure Act data that originators will begin reporting on their lending activity in 2018. The CFPB proposal would exclude or modify loan-level data like property addresses and credit scores from being publicly disclosed to protect consumers' privacy, the agency said Wednesday. It's also proposing to exclude data that it says could be used, along with other public data, to re-identify consumers, such as the loan officer identification numbers issued by the Nationwide Multistate Licensing System. Mortgage lenders long have been concerned that personal data, if disclosed publicly, could be used to identify individuals. Financial institutions are also concerned that advocacy groups and media outlets would use the publicly-disclosed data to home in on differences in mortgage approval rates to allege discrimination against banks and mortgage lenders. There are 11 HMDA data points that will be excluded entirely or obscured to reduce the likelihood of being used to identify a consumer. For example, the new property value field will appear as "the midpoint for the $10,000 interval into which the reported loan amount falls," the agency said, adding "for a reported loan amount of $117,834, the Bureau would disclose $115,000 as the midpoint between values equal to $110,000 and less than $120,000."

 How Many of 2017’s Retail Bankruptcies Were Caused by Private-Equity’s Greed? - Pam Martens - According to S&P Global Market Intelligence, there have been 35 retail bankruptcies this year, almost double the 18 retail bankruptcies of last year. The filing by Toys ‘R’ Us this week was the latest. What many of these retailers have in common is that they were taken private in leveraged buyouts (LBOs) by private equity (PE) firms. Toys ‘R’ Us, Payless ShoeSource, The Limited, Wet Seal, Gymboree Corp., rue21, and True Religion Apparel were all LBOs. Gander Mountain can also be included in this list if you reach back to its 1984 LBO. Far too many LBOs are simply asset stripping operations by Wall Street vultures who load the company with enormous debt, then asset strip the cash from the company by paying themselves obscene special dividends and management fees. On June 12 of this year, the official committee of unsecured creditors to Payless, consisting primarily of Payless stores’ landlords and vendors, alleged in a filing in U.S. bankruptcy court that the private equity firms involved in the Payless LBO in 2012, Golden Gate Capital and Blum Capital, had “siphoned over $400 million out of Payless. Lawyers for the unsecured creditors wrote the following in their objection:  […] But inexplicably, after making these serious allegations in June, the unsecured creditors agreed to a settlement the same month. According to multiple news reports, the unsecured creditors agreed to wave their claims against the LBO sponsors in exchange for $25 million in cash in the bankruptcy reorganization. The sponsors were allowed to settle “without admitting any wrongdoing of any kind.”

Toys R Us: Another Private Equity Casualty - Jerri-Lynn Scofield -- After 69 years in business, retailer Toys R Us filed for Chapter 11 bankruptcy this week– the second largest US retail bankruptcy ever. Private equity’s role  in causing the company’s demise is evident– as has been the case for a slew of retailer bankruptcies this year. Posts such as this one earlier in the summer by Yves mean the overall trend isn’t news to regular readers, see Private Equity Firms Sued Over Retailer Bankruptcies (and the earlier links included therein). Nonetheless, many, including yesterday’s Financial Times are now also piling on the private equity culprit with respect to Toys R Us:But the blame is perhaps to be placed most squarely on its private equity ownership. Toys R Us has spent more than $250m a year servicing $5bn in long term debt, which was “not a sustainable situation,” one investor said, as the company faced increasingly crushing competition from Amazon and Walmart.After years of rearranging its debt burden, like other big leveraged buyouts of the pre-financial crisis era, it is presenting a restructuring under bankruptcy protection as a bid for freedom. Toys R Us says it now has a chance to bring its “vision to fruition”, announcing plans to invest in marketing and technology and even promising to raise store employees’ wages. Likewise, Pam and Russ Martens don’t mince words when they describe the underlying cause for this year’s wave of retail bankruptcies in their Wall Street on Parade post, How Many of 2017’s Retail Bankruptcies Were Caused by Private-Equity’s Greed? What many of these retailers have in common is that they were taken private in leveraged buyouts (LBOs) by private equity (PE) firms. Toys ‘R’ Us, Payless ShoeSource, The Limited, Wet Seal, Gymboree Corp., rue21, and True Religion Apparel were all LBOs. Gander Mountain can also be included in this list if you reach back to its 1984 LBO. Far too many LBOs are simply asset stripping operations by Wall Street vultures who load the company with enormous debt, then asset strip the cash from the company by paying themselves obscene special dividends and management fees. Please permit me to reproduce their list of the largest retail names that have sought bankruptcy protection thus far in 2017:

Warren Buffett wins $1M bet made a decade ago that the S&P 500 stock index would outperform hedge funds -- In 2007, Warren Buffett challenged finance professionals in the hedge fund industry to accept a bet that Buffett described in his 2016 letter to shareholders of Berkshire-Hathaway (see p. 21-21): In Berkshire’s 2005 annual report, I argued that active investment management by professionals – in aggregate – would over a period of years underperform the returns achieved by rank amateurs who simply sat still. I explained that the massive fees levied by a variety of “helpers” would leave their clients – again in aggregate – worse off than if the amateurs simply invested in an unmanaged low-cost index fund. Subsequently, I publicly offered to wager $500,000 that no investment pro could select a set of at least five hedge funds – wildly-popular and high-fee investing vehicles – that would over an extended period match the performance of an unmanaged S&P-500 index fund charging only token fees. I suggested a ten-year bet and named a low-cost Vanguard S&P fund as my contender. I then sat back and waited expectantly for a parade of fund managers – who could include their own fund as one of the five – to come forth and defend their occupation. After all, these managers urged others to bet billions on their abilities. Why should they fear putting a little of their own money on the line? MP: Specifically, Buffett offered to bet that over a ten-year period from January 1, 2008 to December 31, 2017, the S&P 500 index would outperform a portfolio of funds of hedge funds when performance is measured on a basis net of fees, costs and all expenses. What followed was the sound of silence. Though there are thousands of professional investment managers who have amassed staggering fortunes by touting their stock-selecting prowess, only one man – Ted Seides – stepped up to my challenge. Ted was a co-manager of Protégé Partners, an asset manager that had raised money from limited partners to form a fund-of-funds – in other words, a fund that invests in multiple hedge funds.

MBA calls for change to HUD disaster policy --The Mortgage Bankers Association is asking for a tweak to Federal Housing Administration timelines for re-inspecting homes in a pending sale during natural disasters.At the heart of the MBA's concern is the Department of Housing and Urban Development's interpretation of policy that determines when lenders can re-inspect homes.HUD requires re-inspections to be done after the end of Federal Emergency Management Agency incident periods and if those periods are lengthy, closing delays can be excessive, according to the MBA, which noted that incident periods related to recent hurricanes in Florida and Texas have not ended yet.While some incident periods span a matter of days, more recent ones connected with larger hurricanes have gone on for weeks and often get reopened or extended, according to the MBA."Because FEMA incident periods can run anywhere from a few weeks to a couple of months (and often get reopened or extended), many borrowers are needlessly delayed from completing transactions, even where there is no damage to the home," said MBA President and CEO David Stevens in a letter sent to HUD Secretary Ben Carson this week.To avoid excessive closing delays, the association is asking HUD to allow re-inspections to be done after the start date of a FEMA incident period rather than after it ends, something that is more in line with government-sponsored enterprises and the Department of Veterans Affairs policy, according to Stevens. "We have reviewed the policies of both the GSEs and the VA, and it appears that only HUD ties its re-inspection requirement to the end date of the FEMA incident period," Stevens said. "This is an area where we believe HUD alignment with GSE standards would seem to make common sense." Freddie Mac's policy for Harvey and Irma calls for lenders to re-inspect as soon as possible to the extent that it is feasible and the lender can mitigate enough risk, said said Lisa Tibbitts, a spokeswoman for Freddie Mac.

Black Knight: Preliminary Assessment Shows Over 3.1 Million Mortgaged Properties in Hurricane Irma Disaster Areas  From Black Knight: Black Knight: Hurricane Preliminary Assessment Shows Over 3.1 Million Mortgaged Properties in Hurricane Irma Disaster Areas:
• Florida FEMA-designated disaster areas related to Hurricane Irma include over 3.1 million mortgaged properties
• Irma-related disaster areas contain nearly three times as many mortgaged properties as those connected to Hurricane Harvey, and nearly seven times as many as those connected to Hurricane Katrina in 2005
• The $517 billion in unpaid principal balances in Irma-related disaster areas is nearly three times the amount as in those related to Harvey and more than 11 times of those connected to Katrina
• Irma-related disaster areas now include more than 90 percent of all mortgaged properties in Florida
Today, the Data & Analytics division of Black Knight Financial Services, Inc. released a preliminary assessment of the potential mortgage-related impact from Hurricane Irma. As Black Knight Data & Analytics Executive Vice President Ben Graboske explained, both the number of mortgages and the unpaid principal balances of those mortgages in FEMA-designated Irma disaster areas are significantly larger than in the areas impacted recently by Hurricane Harvey. “While the total extent of the damage from Hurricane Irma is still being determined, it is clear that the size and scope of the disaster is immense,” said Graboske. “Indeed, in terms of the number of mortgaged properties and their associated unpaid principal balances, Irma significantly outpaces even the number of borrowers impacted by Hurricane Harvey. With FEMA expanding the number of Irma-related designated disaster areas late Wednesday, Sept. 13, to a total of 37 Florida counties, more than 90 percent of all mortgaged properties in the state now fall into such areas. More than 3.1 million properties are now included in FEMA-designated Irma disaster areas, representing approximately $517 billion in unpaid principal balances. In comparison, Harvey-related disaster areas held 1.18 million properties – more than twice as many as with Hurricane Katrina in 2005 – with a combined unpaid principal balance of $179 billion. Irma-related disaster areas now contain nearly seven times as many mortgaged properties as those connected to Katrina, with more than 11 times the principal balances.

Irma affected more than 90% of Florida's mortgaged properties -  More than 90% of all mortgaged properties in Florida are in a FEMA-designated disaster area following Hurricane Irma, nearly three times the number impacted by Hurricane Harvey, according to Black Knight."While the total extent of the damage from Hurricane Irma is still being determined, it is clear that the size and scope of the disaster is immense," Ben Graboske, Black Knight data & analytics executive vice president, said in a press release."Indeed, in terms of the number of mortgaged properties and their associated unpaid principal balances, Irma significantly outpaces even the number of borrowers impacted by Hurricane Harvey.""More than 3.1 million properties are now included in FEMA-designated Irma disaster areas, representing approximately $517 billion in unpaid principal balances. In comparison, Harvey-related disaster areas held 1.18 million properties — more than twice as many as with Hurricane Katrina in 2005 — with a combined unpaid principal balance of $179 billion," Graboske said.There were 456,000 mortgaged properties in the Hurricane Katrina disaster area, with an unpaid principal balance of $46 billion.Over one-quarter of the mortgage borrowers whose properties were in areas affected by Hurricane Harvey could miss at least one loan payment over the next four months, Black Knight previously said. That analysis was based on the experience following Hurricane Katrina, where like Hurricane Harvey, the majority of the damage was flood related. Black Knight did not do a similar analysis with Irma because most of the damage was wind-related, a Black Knight spokesman explained.

$700 BIllion Unpaid Mortgage Balances In Hurricane Harvey And Irma Disaster Areas - Even as the damage from Hurricanes Harvey and Irma is still being tallied, a preliminary assessment released last week by Black Knight Financial Services estimated that as many as 300,000 borrowers in the vicinity of Houston could become delinquent on their loans and 160,000 could become seriously delinquent, or more than 90 days past due.  That number is roughly four times the original prediction because new disaster zones were designated and more homes flooded when officials released water from reservoirs to protect dams, according to CNBC's Diana Olick. In total, the number of mortgaged properties in Texas disaster zones is 1.18 million, with Black Knight adding that Houston disaster zones contain twice as many mortgaged properties than Katrina zones, with four times the unpaid principal balance. Putting the Harvey damage in context, after Hurricane Katrina mortgage delinquencies in Louisiana and Mississippi disaster areas spiked by 25%. The same could happen in Houston, as borrowers without flood insurance weigh their options and decide to walk away from the property. While they will get some federal relief, if rebuilding would cost more than the principal in their homes, they could decide to walk away according to Olick. What about Irma?According to a preliminary analysis by Black Knight released today, Florida FEMA-designated disaster areas related to Hurricane Irma include a whopping 3.1 million mortgaged properties.  As Black Knight's EVP Ben Graboske explained, both the number of mortgages and the unpaid principal balances of those mortgages in FEMA-designated Irma disaster areas are significantly larger than in the areas impacted recently by Hurricane Harvey. Quantifying the damage, Black Knight calculates that Irma-related disaster areas contain nearly three times as many mortgaged properties as those connected to Hurricane Harvey, and nearly seven times as many as those connected to Hurricane Katrina in 2005. In dollar terms, this means that there is some $517 billion in unpaid principal balances in Irma-related disaster areas, nearly three times the amount as in those related to Harvey and more than 11 times of those connected to Katrina.

Tide of foreclosures is rising in Houston's flooded housing market -- Houston's housing market will be in recovery mode for a while following epic floods from Hurricane Harvey. But the Bayou City's residential market was already sinking before Hurricane Harvey hit. Foreclosure postings in the Houston area were up by a staggering 67% even before the storm blew in, according to a new report by Attom Data Solutions. Nationwide foreclosures were over 21% below where they were a year earlier in August. Economists and real estate agents predict that Houston foreclosures will rise as some owners walk mortgages on properties that were heavily damaged by flooding and had no insurance. "The Houston housing market was already showing signs of distress even before Hurricane Harvey hit," said Attom Data Solutions' economist Daren Blomquist. "Hurricane Harvey will mean even more distress in the Houston housing market over the next year or two, although it may take some time for that to show up in the foreclosure numbers given the foreclosure moratoriums in place." "Based on sales data that has come in for August so far, we are projecting a 27% year-over-year decline in Houston home sales in August," he said. "By comparison we are projecting a 2% increase in Dallas."

Delinquencies in areas affected by Harvey jump 16% - Mortgage delinquencies in areas affected by Hurricane Harvey last month were 16% higher than in July, according to Black Knight Financial Services.More than 6,700 new 30-day delinquencies stem from the hurricane and 1,000 borrowers already 30 days past due missed another payment, said Black Knight.Despite the spike in Harvey-related delinquencies, nationally on loans not yet in foreclosure they were flat compared to July, rising only 0.72% to 3.93%, and compared to a year ago the rate is 7.27% lower than it was last August.Texas is now among the five states that have seen the most deterioration in their noncurrent loan percentages over the last six months, although states like South Dakota, Nebraska and North Dakota have seen more deterioration than Texas. Delinquencies related to a natural disaster historically peak in the first few months and late payments for September could be more pronounced as Harvey and other hurricanes affect loans. More than a quarter of properties in Harvey-affected areas could be delinquent within four months after the storm, Black Knight previously forecast.More than 2 million loans had delinquencies of 30 or more days but were not in foreclosure last month. That total was up 17,000 from July and down 148,000 from August a year ago. When foreclosures are added to the delinquent-loan total for August, it rises to almost 2.4 million.

Black Knight: Mortgage Delinquencies increase in Hurricane Affected Areas -- From Black Knight: Black Knight’s First Look at August 2017 Mortgage Data: Hurricane Harvey Impact Already Being Felt in the Mortgage Market as Delinquencies Jump 16 Percent in Affected Areas -

• Nationally, delinquencies remained relatively flat from July, while delinquencies in Hurricane Harvey- impacted areas rose by 16 percent month over month
• Despite most payments being due August 1, and the storm making landfall near the end of the month, its effect on mortgage delinquencies is already being felt
• Over 6,700 new 30-day delinquencies can be attributed to Harvey, while an additional 1,000 borrowers who were already 30-days past due missed an additional mortgage payment in August as a result of the storm
• Based on observations from previous hurricanes, the heaviest impact on mortgage delinquency rates will come in September
According to Black Knight's First Look report for August, the percent of loans delinquent increased 0.7% in August compared to July, and declined 7.3% year-over-year. The percent of loans in the foreclosure process declined 3.3% in August and were down 27.2% over the last year. Black Knight reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) was 3.93% in August, up from 3.90% in July.The percent of loans in the foreclosure process declined in August to 0.76%.  The number of delinquent properties, but not in foreclosure, is down 148,000 properties year-over-year, and the number of properties in the foreclosure process is down 142,000 properties year-over-year.

 Home Prices Soar in Disaster-Prone Areas - It’s been a bad few weeks for natural disasters.  A series of hurricanes ripped through Texas, Florida, and the Caribbean, killing hundreds and racking up hundreds of billions of dollars in damage. Wildfires are raging in the Western U.S., and a pair of powerful earthquakes have battered Mexico.  Amid the terrifying recent events is a worrisome finding from a new report: The parts of the U.S. most at risk of natural disasters are also the places where property values are highest and increasing most quickly. The chart comes from Attom Data Solutions’ natural hazard index, which matches geographic areas to government data on risk of flood, earthquake, tornado, wildfire, hurricane, and hail. The riskiest 20 percent of U.S. counties have the most homes, the highest average home values, and the greatest price appreciation in recent years. Why? Buyers who pay premiums for ocean views and mountain lookouts may be getting some additional disaster risk as part of the bargain, said Daren Blomquist, senior vice president at Attom. Those kinds of geographical attributes are likely secondary factors in driving price appreciation, though. More importantly, Attom’s list of disaster-prone areas overlaps with engines of economic activity.“The primary reason people buy a home somewhere is that there are jobs there,” said Blomquist. In the aftermath of hurricanes such as Harvey and Irma is a tendency to question the wisdom of building population centers in low-lying areas unequipped to handle flooding caused by those storms. In recent years, however, homebuyers in flood-prone parts of the country appear to be factoring in the risk of such disasters, according to Blomquist. California, on the other hand, is driving the trend toward higher prices in more perilous locales. Earthquake risks abound throughout the state, while robust job growth and restrictive housing policies have driven rapid home price appreciation.

"I Don't Have Anything To Start Over" - Harvey Victims Pray For Relief As 1000s Remain Stuck In Shelters --It’s been nearly a month since Hurricane Harvey, a storm that some expect to rank among the costliest natural disasters in US history, and still tens of thousands of Texans remain marooned in temporary housing, unable to return to their flood-damaged homes, while thousands more are struggling to secure hotel rooms and other types of temporary housing, according to the Wall Street Journal.The scramble for housing has caused occupancy rates at hotels in the Houston area to surge as disaster recovery officials scramble to arrange short-term and permanent housing for those left homeless by the storm. The task of securing shelter for the displaced could take months.“Lillian Godfrey has been sleeping on an air mattress on the floor of her friend’s shuttered night club, alongside her daughter and two pool tables, ever since floodwaters swept into her home here last month.Ms. Godfrey, 74 years old, has a federal voucher for a hotel, but hasn’t had any luck finding a room nearby. Her daughter’s cars were lost in the flooding.“The Lord closes some doors and opens others. He’s going to pull me through this sooner or later.’”As recently as Saturday night, 4,700 people remained in Red Cross shelters across Texas on Saturday night, according to the relief group. Initially as many as 450,000 Texans were displaced by the storm, while as many as 30,000 sought temporary relief in one of the state’s shelters. Some of the displaced, uneasy with the prospect of living elsewhere, have remained in their water-damaged homes. Others were staying with friends, family or even strangers. It is still unclear how many people in Texas will lose their homes because of the storm or how many eventually will be able to move back. But some estimates expect the total damages to property and the US economy in terms of lost productivity could tally as high as $190 billion.

Foreclosure increase in August more than double the norm -- The rise in foreclosure filings for August over July was more than double the historic increase between these two months, said Attom Data Solutions."There is often a seasonal monthly increase in foreclosure activity in August paralleling the seasonal slowdown in the overall real estate market, but the 14% month-over-month increase nationwide this August is more than twice the average 6% seasonal increase in August over the previous 10 years — the highest in fact since a 37% month-over-month increase in August 2007," said Attom Data Solutions Senior Vice President Daren Blomquist in a press release.  "While this seasonal increase is certainly not enough to set off alarm bells nationwide, especially given that foreclosure activity was down annually for the 23rd consecutive month in August, there is cause for concern in a few local markets where foreclosure activity has consistently been trending higher on an annual basis this year." There were 75,115 properties with some sort of foreclosure filing (including default notices, scheduled auctions and bank repossessions) in August, compared with 66,112 in July and 95,132 in August 2016.  The five states with the most foreclosure activity were Florida with 8,237 filings, California with 7,479, New Jersey with 5,721, Illinois with 5,137 and Ohio with 4,540.

FHA lenders get leeway on Irma re-inspection timelines - Lenders are getting some relief from Federal Housing Administration policies that delay re-inspections of homes involved in pending sales during disasters.Presidentially declared major disaster areas in Florida are stable enough for re-inspections to begin before the FHA's normally required timeline ends, according to a Sept. 19 FHA bulletin.The FHA normally requires lenders to wait until the Federal Emergency Management Agency's incident period associated with a disaster ends, but in the case of properties affected by Hurricane Irma in Florida lenders can now get a waiver to start earlier.  However, lenders should be aware more disaster areas could still be added in the state until the incident period, the FHA noted in its bulletin. The government agency issued the waiver in response to a Mortgage Bankers Association request last week for a tweak to FHA timelines for re-inspecting homes in a pending sale.

Lenders 'just scratching the surface' in nonprime RMBS -- Nonprime mortgage securitization has picked up considerably this year, with several new sponsors pooling these loans into collateral for bonds, many of them publicly rated. But lenders are only doing a fraction of what is possible, according to panelists at ABS East. Matt Nichols, chief executive of Deephaven Mortgage, said that the single limiting factor on the market is not investor appetite, but the supply of loans. “It comes down to the individual loan officer; is he going to make the decision to sell,” Nichols said. "Even if it’s a great product for the consumer, there is an intrinsic block in the mind of the lender,” he said. “There’s a risk-adjusted rate out there for someone," but "the return of risk-based pricing takes time to adopt at the loan officer level." Consumer awareness is also a limitation, according to Steven Schwalb, chief executive of Angel Oak Home Loans. “We’re in the first or second strikes at the bottom of the first inning of a nine inning game in terms of consumers becoming aware” Schwalb said. “We’ve just scratched the surface in terms of consumers being aware.” Dane Smith, managing director Invictus Capital Partners, thinks there are about 1 million loans a year that are not getting done. While a lot could go the Federal Housing Administration, which insures loans with low down payments and offers easier credit qualifying that Fannie Mae or Freddie Mac, “it’s not unreasonable to expect that this market could grow to 10%" of the private-label market in the next five years, Smith said.

The Ultimate Anti-Competitive Mergers -  David Dayen -When you need a new mortgage in the future, will your only options be AmazonWellsFargo or AppleChase? The prospect of a mash-up of banking and commerce keeps people like George Washington University law professor Arthur Wilmarth up at night. “This would mean an end to healthy innovation and startups and competition,” said Wilmarth. “I think it is that dire.” Wilmarth sees the seeds of a new era of conglomerates in a series of actions by federal regulators and small firms to allow “fintech,” or financial technology companies, to become FDIC-insured banks. In June, SoFi, which offers student loan refinancing and wealth management services for high-income young people, applied for an “industrial loan company” charter in Utah, and early this month, the payment processing company Square followed suit. The Utah loophole has long been a back door for banks to get into ordinary commerce, and it keeps getting worse. The Office of the Comptroller of the Currency has also proposed a second route for fintech firms, through a “special purpose” national bank charter. In principle, these maneuvers could inject competition into a banking industry controlled mostly by four Wall Street giants, making financial services more accessible and flexible to modern needs. But special charters also let fintech evade critical regulatory scrutiny. And the tentative steps by SoFi and Square seem like a dry run for the day Silicon Valley’s giants decide to get in the game, building sprawling businesses the government has aimed to prevent for decades. It’s a well-established principle of efficient capitalism that commerce needs to be separated from finance. Banks get all sorts of privileges from the government—and if banks can also function as ordinary commercial enterprises, they have unfair advantages against other businesses (who are also their clients).  The Bank Holding Company Act of 1956 sought to prevent these advantages, as well as problems in the financial sector from spilling into the broader economy. But it included an exception for “non-bank banks” to either make deposits or issue loans. In 1987, Congress closed that loophole, so non-bank commercial firms couldn’t own any bank receiving FDIC deposit insurance.“But Congress never closes a door without opening a window,” Wilmarth said.

When Wall Street Owns Main Street — Literally - Rana Foroohar - In the midst of the housing crisis and Great Recession a few years back, I spent a lot of time traveling through the Inland Empire, a large metropolitan area in the middle of Southern California. It stretches an hour or two east of Los Angeles and Orange County, but is about as far away from the tony “OC” lifestyle as you can imagine. Made up primarily of San Bernardino and Riverside counties, the Inland Empire was at the heart of the subprime mortgage crisis and has yet to fully recover.In the early 2000s, predatory lenders flocked to the area, offering dicey deals to the largely minority and lower-middle-class white populations who, unable to afford housing on the coast, still craved the American Dream of homeownership. It ended, as it did in so many neighborhoods and cities across America, in tears and massive foreclosures, turning entire cities into ghost towns of derelict properties.As recently as 2012, when I visited the Del Rosa neighborhood of San Bernardino, one of the hardest-hit cities in the housing crisis, remaining homeowners’ efforts to keep their properties up were being thwarted left and right. Groups of young men and school-age kids with pit bulls in tow hung out in front of corner bodegas at midday. For every well-kept bungalow with freshly cut grass and potted plants on the porch, there was an abandoned building spray-painted with gang graffiti or strewn with dirty mattresses and empty liquor bottles. Highway billboards featured mainly ads for credit counseling, megachurches, and mobile home dealers. There’s a housing recovery on, but you wouldn’t know it in places like San Bernardino—and finance is one big reason why, not just because of its role in the crisis, but also because of its role in the recovery. Such communities are slowly healing, but many still struggle with residual blight from the housing boom and bust. Unemployment rates remain above the national average, mortgage credit is still tight, and few who’ve managed to hang on to their homes can hope to get anywhere near the prices they paid for them pre-crisis.

 U.S. probes high-pressure mortgage sales targeting veterans --The U.S. is investigating lenders for allegedly pressuring veterans and members of the military into unneeded mortgage refinances — unsavory conduct that not only leads to higher consumer costs but has consequences for one of the world’s largest bond markets.The probe is being conducted by Ginnie Mae, a government-owned corporation whose purpose is to make mortgages more affordable. It does so by guaranteeing repayment on $2 trillion of mortgage bonds even if borrowers default on the underlying loans. Ginnie-backed securities support several federal housing initiatives, including programs in which loans are made through the Department of Veterans Affairs.The concern is that some lenders are improperly pushing veterans and servicemembers to refinance loans that have been wrapped into Ginnie securities. Lenders are hounding consumers to refinance loans over and over again in a short period of time, according to Ginnie Acting President Michael Bright. The practice, known as churning, generates high fees for lenders but can leave servicemembers with larger loan balances.The issue is starting to resonate on Capitol Hill, where it has drawn the attention of Sen. Elizabeth Warren, one of the finance industry’s most relentless critics. Last week, the Massachusetts Democrat sent Bright a letter, asking whether some lenders were abusing Ginnie’s program by engaging in aggressive marketing tactics. In a response to Warren dated Thursday, Bright said Ginnie and Veterans Affairs had created a task force to address churning and other abusive practices by lenders approved to issue Ginnie-backed bonds. The agencies could impose restrictions on refinances and ban lenders from their programs. Bright’s letter didn’t identify any specific companies engaging in churning. “There are clearly some Ginnie Mae-approved issuer companies who appear to be taking advantage of the VA program to aggressively market and churn loans in our securities,” Bright wrote to Warren in his letter, which Ginnie provided to Bloomberg News.

Real estate industry blocks sea-level warnings that could crimp profits on coastal properties -- All along the coast of the southeast United States, the real estate industry confronts a hurricane. Not the kind that swirls in the Atlantic, but a storm of scientific information about sea-level rise that threatens the most lucrative, commission-boosting properties.These studies warn that Florida, the Carolinas and other southeastern states face the nation’s fastest-growing rates of sea level rise and coastal erosion — as much as 3 feet by the year 2100, depending on how quickly Antarctic ice sheets melt. In a recent report, researchers for Zillow estimated that nearly 2 million U.S. homes could be literally underwater by 2100, if worst-case projections become reality.This is not good news for people who market and build waterfront houses. But real estate lobbyists aren’t going down without a fight. Some are teaming up with climate change skeptics and small government advocates to block public release of sea-level rise predictions and ensure that coastal planning is not based on them.  The flooding and destruction caused by Hurricanes Irma and Harvey has again highlighted the risks of owning shoreline property. But coastal real estate development remains lucrative, and in recent months and years, the industry has successfully blocked coastal planning policies based on ever-higher oceans. Last month, President Donald Trump rescinded an Obama-era executive order that required the federal government to account for climate change and sea level rise when building infrastructure, such as highways, levees and floodwalls. Trump’s move came after lobbying from the National Association of Home Builders, which called the Obama directive “an overreaching environmental rule that needlessly hurt housing affordability.”

Mortgage Equity Withdrawal slightly positive in Q2 - The following data is calculated from the Fed's Flow of Funds data (released yesterday) and the BEA supplement data on single family structure investment. This is an aggregate number, and is a combination of homeowners extracting equity - hence the name "MEW" - and normal principal payments and debt cancellation (modifications, short sales, and foreclosures). For Q2 2017, the Net Equity Extraction was a positive $12 billion, or a positive 0.3% of Disposable Personal Income (DPI) . This graph shows the net equity extraction, or mortgage equity withdrawal (MEW), results, using the Flow of Funds (and BEA data) compared to the Kennedy-Greenspan method. Note: This data is impacted by debt cancellation and foreclosures, but much less than a few years ago.The Fed's Flow of Funds report showed that the amount of mortgage debt outstanding increased by $64 billion in Q2.The Flow of Funds report also showed that Mortgage debt has declined by $1.23 trillion since the peak. This decline is mostly because of debt cancellation per foreclosures and short sales, and some from modifications. There has also been some reduction in mortgage debt as homeowners paid down their mortgages so they could refinance.With a slower rate of debt cancellation, MEW will likely be mostly positive going forward.

CoreLogic: "2.8 million Homes still in negative equity" at end of Q2 2017 -- From CoreLogic: CoreLogic Reports 2.8 Million Residential Properties with a Mortgage Still in Negative Equity CoreLogic® ... today released its Q2 2017 home equity analysis which shows U.S. homeowners with mortgages (roughly 63 percent of all homeowners) have seen their equity increase by a total of 10.6 percent year over year, representing a gain of $766 billion since Q2 2016. Additionally, homeowners gained an average of $12,987 in equity between Q2 2016 and Q2 2017. Western states led the equity increase with Washington homeowners gaining an average of approximately $40,000 in home equity and California homeowners gaining an average of approximately $30,000 in home equity. Home price increases in these states drove the equity gains. From Q1 2017 to Q2 2017, the total number of mortgaged residential properties with negative equity decreased 10 percent to 2.8 million homes, or 5.4 percent of all mortgaged properties. Year over year, negative equity decreased 21.9 percent from 3.6 million homes, or 7.1 percent of all mortgaged properties, from Q2 2016 to Q2 2017. “Over the last 12 months, approximately 750,000 borrowers achieved positive equity,” said Dr. Frank Nothaft, chief economist for CoreLogic. “This means that mortgage risk continues to decline and, given the continued strength in home prices, CoreLogic expects home equity to rise steadily over the next year.”

FHFA House Price Index: Index Up 0.2% in July - The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for July. Here is the opening of the report:  U.S. house prices rose in July, up 0.2 percent from the previous month, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI). The previously reported 0.1 percent increase in June remained the same.The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. From July 2016 to July 2017, house prices were up 6.3 percent.For the nine census divisions, seasonally adjusted monthly price changes from June 2017 to July 2017 ranged from -0.5 percent in the West North Central and Pacific divisions to +0.6 percent in the East North Central division. The 12-month changes were all positive, ranging from +4.2 percent in the West North Central division to +8.2 percent in the Mountain and Pacific divisions. [Link to report] The chart below illustrates the monthly HPI series, which is not adjusted for inflation, along with a real (inflation-adjusted) series using the Consumer Price Index: All Items Less Shelter.

Mortgage rates rise after nearly two months of declines --The 30-year fixed-rate mortgage averaged 3.83% for the week ending Sept. 21, up from last week when it averaged 3.78%. A year ago at this time, the 30-year fixed-rate mortgage averaged 3.48%. "This week's uptick in the 30-year mortgage rate ends a nearly two-month streak of declines," Sean Becketti, Freddie Mac's chief economist," said in a press release.The 15-year fixed-rate mortgage averaged 3.13%, up from last week when it averaged 3.08%. A year ago at this time, the 15-year fixed-rate mortgage averaged 2.76%.The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.17% this week with an average 0.4 point, up from last week when it averaged 3.13%. A year ago at this time, the five-year adjustable-rate mortgage averaged 2.8%. "The 10-year Treasury yield continued its upward trend, rising 7 basis points this week. As we expected, the 30-year mortgage rate followed suit, increasing 5 basis points," Becketti said."Mortgage rates increased last week to their highest levels in a month as geopolitical concerns surrounding North Korea eased and Hurricane Irma proved to be less destructive than anticipated," Erin Lantz, Zillow's vice president of mortgages, said when that company released its own rate tracker on Tuesday. "This week markets will focus on Wednesday's FOMC statement."The Federal Open Market Committee announced that it would begin to initiate a reduction of its balance sheet next month by setting caps on the reinvestment of principal payments from the Fed’s balance sheet. The plan calls for the roll-off of $6 billion in Treasury securities and $4 billion in mortgage-backed securities per month through December.

 MBA: Mortgage Applications Decrease in Latest Weekly Survey --From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey: Mortgage applications decreased 9.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 15, 2017. Last week’s results included an adjustment for the Labor Day holiday.... The Refinance Index decreased 9 percent from the previous week. The seasonally adjusted Purchase Index decreased 11 percent from one week earlier. The unadjusted Purchase Index increased 10 percent compared with the previous week and was 2 percent higher than the same week one year ago ... The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) increased to 4.04 percent from 4.03 percent, with points remaining unchanged at 0.40 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The first graph shows the refinance index since 1990. Refinance activity will not pick up significantly unless mortgage rates fall well below 4%.

Refi mortgage market share could plummet to 1990 low, Freddie warns - The share of origination volume that comes from refinancing keeps coming in higher than expected, but a Freddie Mac forecast suggests it could really run out of steam next year.The rise in mortgage rates from near-record lows last summer has diminished refi potential to the point where it only represents one-fourth of home loans in 2018, according to Freddie.But refinancing could yet prove to be more resilient than expected.Refi potential due to rate increases is supposed to be less than half of what it was a year ago, potentially affecting only $300 billion loans as opposed to $800 billion last year.But refinances for the first half of 2017 are down only 48% year-to-year. That's because of borrower use of refinancing for other purposes other than rate reduction, such as refinancing in order to shorten the term of a loan or tap home equity.Home prices have appreciated by 6.3% so far this year, according to Freddie Mac's latest monthly economic report. In the first half of 2017, home mortgage borrowers cashed out $31.2 billion in home equity.

NAR: "Existing-Home Sales Subside 1.7 Percent in August " -- From the NAR: Existing-Home Sales Subside 1.7 Percent in August Existing-home sales stumbled in August for the fourth time in five months as strained supply levels continue to subdue overall activity, according to the National Association of Realtors®. Sales gains in the Northeast and Midwest were outpaced by declines in the South and West. Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, retreated 1.7 percent to a seasonally adjusted annual rate of 5.35 million in August from 5.44 million in July. Last month's sales pace is 0.2 percent above last August, and is the lowest since then.  ... Total housing inventory at the end of August declined 2.1 percent to 1.88 million existing homes available for sale, and is now 6.5 percent lower than a year ago (2.01 million) and has fallen year-over-year for 27 consecutive months. Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.5 months a year ago. This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993. Sales in August (5.35 million SAAR) were 1.7% lower than last month, and were 0.2% above the August 2016 rate. The second graph shows nationwide inventory for existing homes. According to the NAR, inventory decreased to 1.88 million in August from 1.92 million in July. Headline inventory is not seasonally adjusted, and inventory usually decreases to the seasonal lows in December and January, and peaks in mid-to-late summer. The last graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

A Few Comments on August Existing Home Sales -- First, as usual, housing economist Tom Lawler's estimate was much closer to the NAR report than the consensus. So the decline in sales in August was no surprise for CR readers. Inventory is still very low and falling year-over-year (down 6.5% year-over-year in August). Inventory has declined year-over-year for 27 consecutive months.  I started the year expecting inventory would be increasing year-over-year by the end of 2017. That now seems unlikely (but not impossible).Inventory is a key metric to watch.  More inventory would probably mean smaller price increases, and less inventory somewhat larger price increases. The following graph shows existing home sales Not Seasonally Adjusted (NSA). Sales NSA in August (535,000, red column) were below sales in  August 2016 (539,000, NSA).Sales NSA are now in the seasonally strong period (March through September). Note: Existing home sales will be weak in the hurricane damaged areas in September.

New Residential Housing Starts Down in Again in August - The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for August new residential housing starts. The latest reading of 1.180M was above the Investing.com forecast of 1.175M and a decrease from the previous month's upwardly revised 1.190M. Here is the opening of this morning's monthly report:Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 1,300,000. This is 5.7 percent (±2.0 percent) above the revised July rate of 1,230,000 and is 8.3 percent (±1.6 percent) above the August 2016 rate of 1,200,000. Single-family authorizations in August were at a rate of 800,000; this is 1.5 percent (±1.3 percent) below the revised July figure of 812,000. Authorizations of units in buildings with five units or more were at a rate of 464,000 in August. Privately-owned housing starts in August were at a seasonally adjusted annual rate of 1,180,000. This is 0.8 percent (±9.6 percent)* below the revised July estimate of 1,190,000, but is 1.4 percent (±8.9 percent)* above the August 2016 rate of 1,164,000. Single-family housing starts in August were at a rate of 851,000; this is 1.6 percent (±9.0 percent)* above the revised July figure of 838,000. The August rate for units in buildings with five units or more was 323,000. [link to report]  Here is the historical series for total privately-owned housing starts, which dates from 1959. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.

Housing Starts decreased to 1.180 Million Annual Rate in August - From the Census Bureau: Permits, Starts and Completions Privately-owned housing starts in August were at a seasonally adjusted annual rate of 1,180,000. This is 0.8 percent below the revised July estimate of 1,190,000, but is 1.4 percent above the August 2016 rate of 1,164,000. Single-family housing starts in August were at a rate of 851,000; this is 1.6 percent above the revised July figure of 838,000. The August rate for units in buildings with five units or more was 323,000.  Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 1,300,000. This is 5.7 percent above the revised July rate of 1,230,000 and is 8.3 percent above the August 2016 rate of 1,200,000. Single-family authorizations in August were at a rate of 800,000; this is 1.5 percent below the revised July figure of 812,000. Authorizations of units in buildings with five units or more were at a rate of 464,000 in August.  The first graph shows single and multi-family housing starts for the last several years.Multi-family starts (red, 2+ units) decreased in August compared to July.  Multi-family starts are down 23% year-over-year.Multi-family is volatile month-to-month, but has been mostly moving sideways over the last few years. Single-family starts (blue) increased in August, and are up 17.1% year-over-year.  The second graph shows total and single unit starts since 1968. The second graph shows the huge collapse following the housing bubble, and then - after moving sideways for a couple of years - housing is now recovering (but still historically low), Total housing starts in August were above expectations, And starts for June and July were revised up.    Also permits were strong in August.

New Residential Building Permits: August Permits Bounce Back - The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for August new residential building permits. The latest reading of 1.300M was an increase from 1.230M in July and above the Investing.com forecast of 1.220M. Here is the opening of this morning's monthly report:Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 1,300,000. This is 5.7 percent (±2.0 percent) above the revised July rate of 1,230,000 and is 8.3 percent (±1.6 percent) above the August 2016 rate of 1,200,000. Single-family authorizations in August were at a rate of 800,000; this is 1.5 percent (±1.3 percent) below the revised July figure of 812,000. Authorizations of units in buildings with five units or more were at a rate of 464,000 in August.Privately-owned housing starts in August were at a seasonally adjusted annual rate of 1,180,000. This is 0.8 percent (±9.6 percent)* below the revised July estimate of 1,190,000, but is 1.4 percent (±8.9 percent)* above the August 2016 rate of 1,164,000. Single-family housing starts in August were at a rate of 851,000; this is 1.6 percent (±9.0 percent)* above the revised July figure of 838,000. The August rate for units in buildings with five units or more was 323,000. [link to report] Here is the complete historical series, which dates from 1960. Because of the extreme volatility of the monthly data points, a 6-month moving average has been included.

 Comments on August Housing Starts -  The housing starts report released this morning showed starts were down 0.8% in August compared to July (July was revised up), and starts were up 1.4% year-over-year compared to August 2016.  This was a decent report and was above the consensus forecast. Also permits were solid for August. This first graph shows the month to month comparison between 2016 (blue) and 2017 (red).Starts were up 1.4% in August 2017 compared to August 2016, and starts are up only 2.7% year-to-date. Note that single family starts are up 8.9% year-to-date, and the weakness (as expected) has been in multi-family starts. My guess is starts will increase around 3% to 7% in 2017. Below is an update to the graph comparing multi-family starts and completions. Since it usually takes over a year on average to complete a multi-family project, there is a lag between multi-family starts and completions. Completions are important because that is new supply added to the market, and starts are important because that is future new supply (units under construction is also important for employment). These graphs use a 12 month rolling total for NSA starts and completions. The blue line is for multifamily starts and the red line is for multifamily completions. The rolling 12 month total for starts (blue line) increased steadily over the last few years - but has turned down recently. Completions (red line) have lagged behind - but completions have almost caught up to starts (more deliveries). Completions lag starts by about 12 months. As I've been noting for a couple of years, the growth in multi-family starts is behind us - multi-family starts peaked in June 2015 (at 510 thousand SAAR). The second graph shows single family starts and completions. It usually only takes about 6 months between starting a single family home and completion - so the lines are much closer. The blue line is for single family starts and the red line is for single family completions. Note the exceptionally low level of single family starts and completions. The "wide bottom" was what I was forecasting following the recession, and now I expect a few years of increasing single family starts and completions.

Harvey and Irma to impact home sales in the short term -- As homebuilding permits have declined in recent months, the market for potential existing-home sales fell to a 5.71 million seasonally adjusted, annualized rate in August, a decline of 1.3% from July, according to First American Financial Corp. Potential existing-home sales decreased by 3.7% year-over-year in August for a loss of 221,000 sales. The market for potential existing-home sales is underperforming its potential by a projected 206,000 sales, or 3.6%. Going forward, Hurricanes Harvey and Irma are expected to impact the market of home sales in the short term, as loan closings are postponed and some borrowers with pending contracts withdraw their bids on damaged homes, according to Mark Fleming, chief economist at First American. "The Houston metropolitan area and the impacted Florida counties alone accounted for 8% of all U.S. existing-home sales in 2016," Fleming said in a press release. "As recovery efforts move forward, the pre-hurricane shortage of construction workers will likely hamper the process of rebuilding efforts, and further limit the pace of new home construction, as the limited labor supply shifts away from new-home construction to rebuilding efforts." The potential existing-home sales market is 11.5%, or 656,000 sales, below the July 2005 pre-recession peak of market potential, but up 89.9% from the market potential low point reached in December 2008. The number of homes listed for sale has declined for 26 consecutive months, and has fallen 9% over the past 12 months, according to the National Association of Realtors.

 NAHB: Builder Confidence decreased to 64 in September -- The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 64 in September, down from 67 in August. Any number above 50 indicates that more builders view sales conditions as good than poor. From NAHB: Builder Confidence Drops Three Points As Hurricanes Add UncertaintyBuilder confidence in the market for newly-built single-family homes fell three points to a level of 64 in September from a downwardly revised August reading of 67 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).“The recent hurricanes have intensified our members’ concerns about the availability of labor and the cost of building materials,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas. “Once the rebuilding process is underway, I expect builder confidence will return to the high levels we saw this spring.” “Despite this month’s drop, builder confidence is still on very firm ground,” said NAHB Chief Economist Robert Dietz. “With ongoing job creation, economic growth and rising consumer confidence, we should see the housing market continue to recover at a gradual, steady pace throughout the rest of the year.” All three HMI components posted losses in September but remain at healthy levels. The component gauging current sales conditions fell four points to 70 and the index charting sales expectations in the next six months dropped four points to 74. Meanwhile, the component measuring buyer traffic slipped a single point to 47.  Looking at the three-month moving averages for regional HMI scores, the West increased three points to 77 and the Northeast rose one point to 49. The South dropped a single point to 66 and the Midwest fell three points to 63.

 Student debt delaying homeownership by nearly a decade - An overwhelming majority of millennials with student loan debt do not currently own a home, and blame the debt for what they expect to be a delay of about seven years before purchasing a home, according to the National Association of Realtors and American Student Assistance. The 20% of surveyed millennials reporting they do currently own a home are carrying a median student debt load of $41,200, which surpasses their median annual income of $38,800. About 79% borrowed money to finance their education at a four-year institution, and just over half are repaying a balance of over $40,000.

AIA: Architecture Billings Index "growth streak" continues in August - Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment.   From the AIA: Architecture Billings Index continues growth streak With all geographic regions and building project sectors showing positive conditions, there continues to be a heightened level of demand for design services signaled in the latest Architecture Billings Index (ABI).  As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lead time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the August ABI score was 53.7, up from a score of 51.9 in the previous month. This score reflects an increase in design services provided by U.S. architecture firms (any score above 50 indicates an increase in billings). The new projects inquiry index was 62.5, up from a reading of 59.5 the previous month, while the new design contracts index eased somewhat from 56.4 to 54.2.  “The August results continue a string of very positive readings from the design professions, pointing to future healthy growth across the major construction sectors, as well as across the major regions of the country,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “Given the focus and discussions around the infrastructure needs of the nation, we expect strong growth in design activity for the coming months and years.”
• Regional averages: South (55.7), Northeast (54.3), Midwest (52.5), West (51.3)
• Sector index breakdown: commercial / industrial (57.6), multi-family residential (53.8), mixed practice (52.5), institutional (50.1)

Fed's Flow of Funds: Household Net Worth increased in Q2 --The Federal Reserve released the Q2 2017 Flow of Funds report today: Flow of Funds.According to the Fed, household net worth increased in Q2 2017 compared to Q1 2017: The net worth of households and nonprofits rose to $96.2 trillion during the second quarter of 2017. The value of directly and indirectly held corporate equities increased $1.1 trillion and the value of real estate increased $0.6 trillion. The Fed estimated that the value of household real estate increased to $23.8 trillion in Q2. The value of household real estate is now above the bubble peak in early 2006 - but not adjusted for inflation, and this also includes new construction.The first graph shows Households and Nonprofit net worth as a percent of GDP.  Household net worth, as a percent of GDP, is higher than the peak in 2006 (housing bubble), and above the stock bubble peak. This includes real estate and financial assets (stocks, bonds, pension reserves, deposits, etc) net of liabilities (mostly mortgages). Note that this does NOT include public debt obligations. This graph shows homeowner percent equity since 1952. Household percent equity (as measured by the Fed) collapsed when house prices fell sharply in 2007 and 2008. In Q2 2017, household percent equity (of household real estate) was at 58.4% - up from Q2, and the highest since Q1 2006. This was because of an increase in house prices in Q2 (the Fed uses CoreLogic).  Note: about 30.3% of owner occupied households had no mortgage debt as of April 2010. So the approximately 50+ million households with mortgages have far less than 58.4% equity - and about 2.8 million homeowners still have negative equity.The third graph shows household real estate assets and mortgage debt as a percent of GDP. Mortgage debt increased by $64 billion in Q2. Mortgage debt has declined by $1.23 trillion from the peak. Studies suggest most of the decline in debt has been because of foreclosures (or short sales), but some of the decline is from homeowners paying down debt (sometimes so they can refinance at better rates). The value of real estate, as a percent of GDP, was up in Q2, and  is above the average of the last 30 years (excluding bubble).  However, mortgage debt as a percent of GDP, continues to decline.

Household Net Worth Hits A Record $96.2 Trillion... There Is Just One Catch --In the Fed's latest Flow of Funds report, today the Fed released the latest snapshot of the US "household" sector as of June 30, 2017. What it revealed is that with $111.4 trillion in assets and a modest $15.2 trillion in liabilities, the net worth of the average US household rose to a new all time high of $96.2 trillion, up $1.7 trillion as a result of an estimated $564 billion increase in real estate values, but mostly $1.23 trillion increase in various stock-market linked financial assets like corporate equities, mutual and pension funds, and deposits as the market soared to new all time highs thanks to some $2 trillion in central bank liquidity injections this year. Total household assets in Q2 rose $1.8 trillion to $111.4 trillion, while at the same time, total liabilities, i.e., household borrowings, rose by only $15 billion from $15.1 trillion to $15.2 trillion, the bulk of which was $9.9 trillion in home mortgages.The breakdown of the total household balance sheet as of Q2 is shown below. And the historical change of the US household balance sheet. And while it would be great news if wealth across all of America had indeed risen as much as the chart above shows, the reality is that there is a big catch: as shown previously, virtually all of the net worth, and associated increase thereof, has only benefited a handful of the wealthiest Americans.As a reminder, from the CBO's latest Trends in Family Wealth analysis published last year, here is a breakdown of the above chart by wealth group, which sadly shows how the "average" American wealth is anything but. In other words, roughly 75% of the $1.8 trillion increase in assets went to benefit just 10% of the population, who also account for roughly 76% of America's financial net worth.It also means that just 10% of the US population is worth $73 trillion, while half of the US population was worth just ~$9.6 trillion.

US Export, Import Prices Spike Most In 14 Months --- US Import and Export prices jumped more than expected in August - both rising 0.6% MoM, the biggest rise since June 2016. A 4.8% MoM spike in Petroleum drove the import surge and the rise in Industrial Supplies' costs sent Export prices higher. Year-over-year, both import and export prices are rising faster than The Fed's 2% mandate...

International Tourism to the U.S. Declined in Early 2017 - Fewer international travelers came to the United States during the first few months of this year than over the same period last year, confirming concerns of some in the travel industry. New figures released by the U.S. Department of Commerce show a drop in international visitors to the United States by close to 700,000 in the first quarter of 2017 compared to the previous year. European countries were down 10.1 percent, and Mexico was off 7.1 percent in the quarter. The largest drops were from the Middle East and Africa, though they represent a much smaller percentage of overall travel to the United States. Overall, 697,791 fewer foreigners visited the United States in the first three months of the year, down 4.2 percent to 15.8 million. According to Tourism Economics, a branch of Oxford Economics based in Wayne, Pa., that analyzes travel data, the drop represents a loss of nearly $2.7 billion in spending. As points of comparison, the first quarter of 2013, after the reelection of Barack Obama, international tourism was up 6.4 percent, and the first quarter of 2009, after President Obama’s first election (and during global recession that began at the end of 2008), it was down 14.3 percent. The question of whether the results prove a ripple effect from President Trump’s proposed travel ban on visitors from six majority-Muslim countries, an expanded wall along the Mexican border and anti-immigrant statements remains unanswered. But the data tracks with a decline in United States favorability abroad: In June, the Pew Research Center found that 49 percent of those surveyed in 37 nations had a positive view of the United States, versus 64 percent at the end of President Obama’s term in office. Last week, Pew reported that nearly two-thirds of Mexicans held a negative opinion of the United States, more than double the figure of two years ago, which stood at 29 percent. “It’s not a reach to say the rhetoric and policies of this administration are affecting sentiment around the world, creating antipathy toward the U.S. and affecting travel behavior,” 

Vehicle Forecast: Sales Expected to Exceed 17 million SAAR in September -- The automakers will report September vehicle sales on Tuesday, October 3rd. Note: There were 26 selling days in September 2017, there were 25 in September 2016. From WardsAuto: Forecast: SAAR Expected to Surpass 17 Million in September: A WardsAuto forecast calls for U.S. light-vehicle sales to reach a 17.5 million-unit seasonally adjusted annual rate in September, following August’s 16.0 million SAAR and ending a 6-month streak of sub-17 million figures. In same-month 2016, the SAAR reached 17.6 million.  Preliminary assumptions pointed to October, rather than September, as the turning point for the market, as consumers replace vehicles lost due to natural disasters and automakers push sales to clear out excess model-year ’17 stock. However, the winds have already begun to turn, and September sales will be significantly higher than originally expected. Sales have been below 17 million SAAR for six consecutive months.

US Manufacturing "An Increasing Drag On The Economy" As PMI Drops For First Time Since March Following a stronger-than-expected Eurozone PMI print this morning, Markit reports amixed bag for preliminary September US PMIs with Manufacturing limping higher but Services missing expectations and slipping notably. After 5 straight months of gains, the US Composite PMI dropped back below pre-election levels.As Markit notes, there were signs of underlying fragility in September, with new orders expanding at one of the slowest rates seen over the past year.Latest data also indicated that new export sales remain close to stagnation.  Despite the ongoing collapse of 'hard' economic data, 'soft' surveys continue to remain hopeful... Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:“The US economy showed encouraging resilience in a month of hurricane disruption. Although the September surveys indicated a moderation in growth of business activity, the overall rate of expansion remained robust. Historical comparisons of the PMI with GDP indicate that the surveys point to the economy growing at an annualised rate of just over 2% in the third quarter.“Similarly, the overall rate of job creation remained solid, historically consistent with non-farm payrolls rising by 180,000 in September.“The biggest impact of Hurricane Harvey was evident in manufacturing supply chains, where resultant supply shortages were a key driver of higher prices. Supply delays were the most widespread in two and a half years, while input price inflation rose to the highest since 2012.“The manufacturing sector, which was already struggling in August, consequently acted as an increasing drag on the economy, leaving services as the main growth driver. The survey is consistent with a slight deterioration in comparable official manufacturing output data.“While repair work in the aftermath of Hurricane Harvey may boost short-term business activity in coming months, a drop in business optimism about the year ahead suggests that companies have become less confident in the longer-term outlook.”

Chemical Activity Barometer "Holds Steady" in September -- Note: This appears to be a leading indicator for industrial production. From the American Chemistry Council: Chemical Activity Barometer Holds Steady; Storms Likely to Cause Future Revisions The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), remained virtually unchanged in September despite the effects of unprecedented Hurricanes Harvey and Irma. Though future revisions are likely, the barometer slipped just 0.04 percent in September, following a 0.03 percent decline in August. Compared to a year earlier, the CAB is up 2.8 percent year-over-year, a marked pullback from recent year-over-year gains. All data is measured on a three-month moving average (3MMA) basis.On a year-over-year basis, the unadjusted CAB is up 2.3 percent, also an easing from the previous six months.  Applying the CAB back to 1912, it has been shown to provide a lead of two to fourteen months, with an average lead of eight months at cycle peaks as determined by the National Bureau of Economic Research. The median lead was also eight months. At business cycle troughs, the CAB leads by one to seven months, with an average lead of four months. The median lead was three months. The CAB is rebased to the average lead (in months) of an average 100 in the base year (the year 2012 was used) of a reference time series. The latter is the Federal Reserve’s Industrial Production Index.

Earlier: Philly Fed Manufacturing Survey "Showed Improvement" in September --Earlier from the Philly Fed: September 2017 Manufacturing Business Outlook Survey: Manufacturing firms reported an improvement in regional manufacturing conditions in September. The survey’s current indicators for general activity, new orders, and shipments increased this month and suggest a broadening of growth. Price pressures also picked up, according to the reporting firms. The survey’s future indicators suggest that manufacturers have generally grown more optimistic over the past three months.  The indexes for general activity [increased to 23.8 from 18.9 in August], new orders, and shipments increased this month, and employment remained positive. Here is a graph comparing the regional Fed surveys and the ISM manufacturing index:

Weekly Initial Unemployment Claims decrease to 259,000 - The DOL reported:In the week ending September 16, the advance figure for seasonally adjusted initial claims was 259,000, a decrease of 23,000 from the previous week's revised level. The previous week's level was revised down by 2,000 from 284,000 to 282,000. The 4-week moving average was 268,750, an increase of 6,000 from the previous week's revised average. This is the highest level for this average since June 4, 2016 when it was 269,500. The previous week's average was revised down by 500 from 263,250 to 262,750.Hurricanes Harvey and Irma impacted this week's claims.  The previous week was revised down. The following graph shows the 4-week moving average of weekly claims since 1971.

Legislature's lawyers: Some provisions in Wisconsin's Foxconn law could be unconstitutional - GOP lawmakers and Gov. Scott Walker may have gone too far in dictating how courts should handle any potential litigation over a massive flat-screen factory planned for Racine County, the Legislature's nonpartisan attorneys have found. The memo from the Wisconsin Legislative Councildidn't come to definite conclusions but found several provisions of the legislation for Foxconn Technology Group of Taiwan and its plant may be unconstitutional.The law signed by Walker on Monday changes how environmental challenges and other potential legal cases over the factory would be handled, including automatically suspending any lower court orders until a higher court has weighed in. The eight-page analysis highlights this provision among the areas of concern, saying the decision on whether to suspend rulings could be seen as a core power of the court system. "A court could hold that the provision is unconstitutional if it finds that this provision violates the judiciary's independence in the fulfillment of its constitutional responsibilities," the memo reads. The legislation would exempt the Foxconn project from a state environmental impact statement and from some state rules to protect wetlands and waterways. That has raised the possibility that environmental groups may sue over the law and project in the near future. To head off delays from that potential litigation, GOP lawmakers and Walker added special requirements on the courts system for handling any Foxconn lawsuits. First, the legislation would expedite appeals of Foxconn-related lawsuits, creating a path that would likely get any case more quickly to the state Supreme Court, where conservatives have a solid majority. Second, the measure requires higher courts to take appeals of a trial court order in a Foxconn case even if the order is not final. In general, appellate courts have to take appeals of the final judgments and orders made by trial courts but get to decide whether to take appeals of preliminary orders. Finally, the trial court rulings in that litigation would be automatically stayed until the higher court decided what to do.

California Legislature Sells Out Our Data to ISPs - EFF -- In the dead of night, the California Legislature shelved legislation that would have protected every Internet user in the state from having their data collected and sold by ISPs without their permission. By failing to pass A.B. 375, the legislature demonstrated that they put the profits of Verizon, AT&T, and Comcast over the privacy rights of their constituents.Earlier this year, the Republican majority in Congress repealed the strong privacy rules issued by the Federal Communications Commission in 2016, which required ISPs to get affirmative consent before selling our data.  But while Congressional Democrats fought to protect our personal data, the Democratic-controlled California legislature did not follow suit. Instead, they kowtowed to an aggressive lobbying campaign, from telecommunications corporations and Internet companies, which included spurious claims and false social media advertisements about cybersecurity.  “It is extremely disappointing that the California legislature failed to restore broadband privacy rights for residents in this state in response to the Trump Administration and Congressional efforts to roll back consumer protection,” EFF Legislative Counsel Ernesto Falcon said. “Californians will continue to be denied the legal right to say no to their cable or telephone company using their personal data for enhancing already high profits. Perhaps the legislature needs to spend more time talking to the 80% of voters that support the goal of A.B. 375 and less time with Comcast, AT&T, and Google's lobbyists in Sacramento.”

California Has a System That Punishes the Poor Through Traffic Violations—Civil Rights Groups Are Starting to Change That - Throughout the United States, cities impose heavy traffic fines to generate revenue. But these expensive fines mostly hurt lower-income people and people of color and often lead to suspended driver’s licenses. As a result, people get trapped in a debtors’ prison as these exorbitant fines pile up.  A recent lawsuit in California’s Solano County Superior Court successfully challenged the state’s policy of holding traffic violators to unreasonable fines, regardless of their ability to pay. Civil liberties groups such as the American Civil Liberties Union and the Lawyers’ Committee for Civil Rights (LCCR) were part of the suit against the court. The settlement provides a template for challenging exorbitant traffic fines and byzantine fee structures that trap people in poverty.  Under the settlement’s terms, Solano County Superior Court will notify traffic defendants of their right to be heard regarding their “ability to pay,” and it will “update all notifications to traffic defendants, including its website, the oral advisements provided by traffic court judges, and the ‘notice of rights’ handout given to all traffic defendants,” according to a Bay Area Legal Aid press release. The updated notices inform defendants of their rights to ask the Court for a lower fine, a payment plan, or community service if they cannot afford the traffic fine. For homeless, low-income, or public-benefit-receiving traffic defendants, the Court agreed to consider alternative penalties that do not involve paying monetary fines, such as community service.

Illinois Vendor Backlog Hits A New Record At Over $16 Billion -- Back in July, the state of Illinois narrowly avoided a junk bond rating with a last minute budget deal that included a 32% in hike in income taxes.  Republican Governor Bruce Rauner vetoed the budget and called it a "disaster," but both houses of the state legislature voted to override his veto.  Meanwhile, S&P and Moody's were apparently both convinced that the budget deal was sufficient for the state to remain an investment grade credit and all lived happily ever after, if just for a few months.   Back in July, S&P defended its IG rating by saying that the budget package brought the state's revenue and spending closer to parity and "reduced the near-term uncertainty that had come to characterize its financial operations."  Of course, if that's true, then someone is going to have to explain to us why the state's unpaid payables balance continues to balloon higher with each passing day and now stands at a record $16,046,145,423.20 according the comptroller's office....which is only a 3-fold increase over the past two years. But, if you're a resident of Illinois, or worse yet a pensioner in one of the state's massively underfunded pension plans, Democratic Comptroller Susana Mendoza would like for you to know that there is no reason for concern as she has the perfect solution to the state's debt problem: $6 billion in more debt.  Per Reuters:The bill backlog is growing despite the enactment of a fiscal 2018 spending plan and income tax increase in July that ended a budget impasse between Illinois’ Republican governor and Democrats who control the legislature. A provision in the budget enacted by lawmakers over the vetoes of Governor Bruce Rauner authorized the sale of up to $6 billion of general obligation bonds to pay bills from vendors and service providers that are accruing late payment penalties of as much as 12 percent.That said, Republican Governor Bruce Rauner points out that there is a small problem with Mendoza's magical $6 billion debt cure-all, namely that there is no funding available to pay 12 years worth of interest payments.

One-third of Native American and African American children are (still) in poverty – EPI - Last week the Census Bureau released data on income, poverty, and health insurance, which showed a slight decline in the national poverty rate (from 14.7 percent in 2015 to 14.0 percent in 2016). There was an even sharper decline in the poverty rate for children under 18 years old, from 19.7 percent in 2015 to 18.0 percent in 2016. While any decrease in poverty is welcome news, national numbers can hide the stark differences in poverty rate by race.Native American, African American, and Hispanic children continue to face the highest poverty rates, all hovering around 30 percent. Despite a small increase in Native American median household income over the year, 1 in 3 Native American children were in poverty in 2016—completely unchanged from 2015. Native Americans are the only ethnic or racial group where child poverty did not go down this year. African American and Hispanic children saw the largest percentage point decrease over the one year period (-2.1 percentage points and -2.3 percentage points, respectively), but still, approximately 1 in 3 children live in poverty. Native American and African American children are also three times more likely to be in poverty than white children. Similar to 2015, Asian childhood poverty rates continue to be similar to white children, and below the overall national childhood poverty rate. Childhood poverty declines when working parents are able to find quality jobs with a decent wage and benefits including child care and paid family leave. While the federal minimum wage sits at $7.25, many states and localities have increased their minimum wages, which helps lift working families out of poverty. At the same time, government programs including Social Security, refundable tax credits, and Supplemental Nutrition Assistance Program (SNAP) are directly responsible for keeping tens of millions out of poverty across the country. While some policymakers continue to try and gut the investments that cut poverty in half year-in and year-out, such as Medicaid and affordable health care, broad-based wage growth is the best way to fight poverty.

Oklahoma Is Imprisoning So Many People It Can’t Hire Enough Prison Guards to Keep Up -- In July of this year, some 150 prisoners at the Great Plains Correctional Facility in Tulsa, Okla., rioted. The riot reportedly developed after a fight between prisoners and lasted for about eight hours. Two prison guards were taken hostage before the prisoners were corralled and returned to their cells.  The incident immediately led to calls for a guard increase. In January, the Oklahoma Department of Corrections announced it had a shortage of correctional officers relative to the state's growing prison population. Oklahoma has the second highest per-capita incarceration rate in the country, and the highest rates of incarceration for both women and black men. Oklahoma isn’t an isolated case. Despite recent pushes for prison reforms and sentence reductions, the ranks of the incarcerated are growing in many states. Meanwhile, there’s a widespread shortage of corrections officers partially due to the profession’s cultural stigma as a job with less prestige than that of a firefighter or police officer. In 2014, 34 states submitted four-year prison projections to The Pew Charitable Trusts. Twenty-eight expected their prison populations to grow between 1 and 16 percent by 2018.Oklahoma had a record 63,009 people in its system as of August. Over the last eight-and-a-half months, the state has added 2,000 prisoners—four times the growth projected by a governor’s task force in February. There have been a number of legislative efforts to reform Oklahoma’s criminal justice policies and potentially lessen its number of prisoners, but these efforts have often been thwarted by the state’s conservative government. Jessica Brand, legal director of the Fair Punishment Project, a national organization that advocates for a fair and accountable justice system, tells In These Times that the state’s aggressive district attorneys also deserve a large chunk of the blame.

Request denied: States try to block access to public records  (AP) — In February, Arkansas lawmakers marked the 50-year anniversary of the Freedom of Information Act with a resolution calling it "a shining example of open government" that had ensured access to vital public records for generations.They spent the following weeks debating and, in many cases approving, new exemptions to the law in what critics called an unprecedented attack on the public's right to know.When they were finished, universities could keep secret all information related to their police forces, including their size and the names and salaries of officers. Public schools could shield a host of facts related to security, including the identities of teachers carrying concealed weapons and emergency response plans. And state Capitol police could withhold anything they believed could be "detrimental to public safety" if made public. While hailed by lawmakers as commonsense steps to thwart would-be terrorists or mass shooters, the new laws left grandmother Annie Bryant worried that she and other parents could now be kept in the dark about how schools protect kids.

Governments turn tables by suing public records requesters | McClatchy Washington Bureau: An Oregon parent wanted details about school employees getting paid to stay home. A retired educator sought data about student performance in Louisiana. And college journalists in Kentucky requested documents about the investigations of employees accused of sexual misconduct. Instead, they got something else: sued by the agencies they had asked for public records. Government bodies are increasingly turning the tables on citizens who seek public records that might be embarrassing or legally sensitive. Instead of granting or denying their requests, a growing number of school districts, municipalities and state agencies have filed lawsuits against people making the requests — taxpayers, government watchdogs and journalists who must then pursue the records in court at their own expense. The lawsuits generally ask judges to rule that the records being sought do not have to be divulged. They name the requesters as defendants but do not seek damage awards. Still, the recent trend has alarmed freedom-of-information advocates, who say it's becoming a new way for governments to hide information, delay disclosure and intimidate critics 

Science teaching guidelines trigger criticism in New Mexico (AP) — Environmentalists and educators raised new objections Tuesday to proposed changes to teaching standards for science in New Mexico that substitute references to rising global temperatures and climate change with statements about climate "fluctuations." The New Mexico Public Education Department has suggested several custom additions and deletions as it moves forward with adopting a set of science standards developed by a consortium of states and the National Academy of Sciences. Additions that highlight the study of New Mexico's unique natural history are being overshadowed by several deletions of references to evolution, the 4.6 billion-year age of the earth and climate change. Critics including environmentalists and science teachers described the substitutions as concessions to creationism and climate-change denial that pose a threat to adequate science education. "Our position is that the Public Education Department has injected politics into science," said Ellen Loehman, a spokeswoman for the New Mexico Science Teachers' Association. The association represents more than 200 science teachers and has urged the Education Department to adopt an unedited version of the Next Generation Science Standards. New Mexico standards were last updated in 2003. "They cut out the words 'rise in global temperature' and changed it to fluctuations," she said. "It's not accurate and it's not appropriate." The Department of Education did not address the rationale behind changes to language in the standards about climate change, evolution or the age of the earth. 

New Mexico Doesn’t Want Your Kids to Know How Old the Earth Is - New Mexico’s public education agency wants to scrub discussions of climate change, rising global temperatures, evolution, and even the age of planet Earth from the standards that shape its schools’ curriculum. The state’s Public Education Department this week released a new proposedreplacement to its statewide science standards. The draft is based on the Next Generation Science Standards, a set of ideas and guidelines released in 2013 that cover kindergarten through 12th grade. The NGSS, which have been adopted by at least 18 states and the District of Columbia, include ample discussion of human-caused climate change and evolution.“These changes are evidently intended to placate creationists and climate change deniers.” But the draft released by New Mexico’s education officials changes the language of a number of NGSS guidelines, downplaying the rise in global temperatures, striking references to human activity as the primary cause of climate change, and cutting one mention of evolution while weakening others. The standards would even remove a reference to the scientifically agreed-upon age of the Earth—nearly 4.6 billion years. (Young Earth creationists use various passages in the Bible to argue that the planet is only a few thousand years old.) “These changes are evidently intended to placate creationists and climate change deniers,” says Glenn Branch, the deputy director of the National Center for Science Education, a nonprofit group that defends the teaching of climate change, evolution, and other scientific-backed subjects in the classroom. The proposed changes, Branch added, “would dumb down New Mexico’s science education.”

Florida Parents Outraged After Teacher Demands Her 5th Graders Use Gender Neutral Pronouns --Over the past year or so, we've observed in amazement as one 'institution of higher indoctrination' (a.k.a. "university") after another came up with replacement pronouns for politically incorrect 'hate speech' like 'freshman'.  Vanderbilt even forced its teachers and administrators to wear name tags defining their pronouns just so there would be absolutely no gender confusion that might lead to a nasty "triggering" event or unnoticed "microaggression (see: Vanderbilt University Name Placards For Faculty Offices Will Now Include "Preferred Pronouns").  But, while such things are expected from our millennial youth on progressive college campuses, parents of a 5th grade class in Tallahassee, Florida were somewhat shocked when they received a letter from "Mx. (pronounced Mix)" Bressack demanding that her students only refer to her using gender neutral terms like 'Mx.' instead of 'Ms.' and "they, them, their" instead of "he, his, she, hers."  Per the Tallahassee Democrat: "One thing that you should know about me is that I use gender neutral terms. My prefix is Mx. (pronounced Mix). Additionally, my pronouns are "they, them, their" instead of "he, his, she, hers". I know it takes some practice for it to feel natural, but my experience students catch on pretty quickly. We're not going for perfection, just making an effort! Please feel free to reach out to me or administration if you have any questions. My priority is for all of my students to be comfortable in my classroom and have a space where they can be themselves while learning."  Of course, it didn't take long for the parents of Mx. Bressack's students to post their outrage to a Facebook group called “Tally Moms Stay Connected." One mom bluntly asked  "is this fucking for real?" while another dad wondered whether it might makes sense to just stick to teaching math and science if your job is to be a math and science teacher.

Dallas School Board Designates Founding Fathers As Having "Confederate Links" -- The Dallas Independent School District is in damage control mode after an internal school board list was obtained by local press which shows schools under consideration for name changes due to possible "connections with slavery or the Confederacy." News of the list, obtained by the Dallas Morning News early this week, caused outrage for the fact that it includes Texas revolutionaries and founders such as Sam Houston, James Bowie and William Travis, as well as Dallas pioneers James Gaston and William Brown Miller. It further names other early American figures who very obviously lived long before the existence of the Confederacy such as U.S. presidents Thomas Jefferson, James Madison and, inexplicably, Ben Franklin.Of course, William Travis and Jim Bowie both died at the Alamo in 1836 while the Confederacy didn't come into existence until 1861. Sam Houston too lived most of his entire life before the civil war and was perhaps the greatest Native American rights supporter of the time, and was adopted as an "honorary Cherokee" by the tribe, having also married a Cherokee woman. Ben Franklin, one of the American founding fathers named on the Dallas ISD list, was a vocal abolitionist. It is stunning and extremely worrisome that school board trustees would be both so historically illiterate and politically correct that they would put such names on the list in the first place.

Psychologists studied 5,000 genius kids for 45 years — here are their 6 key takeaways -- Since it began in 1971, the "Study of Mathematically Precocious Youth," or SMPY, has tracked 5,000 of the smartest children in America — the top 1%, 0.1%, and even 0.01% of all students. It is one of the longest-running studies of gifted children in history. Here's what the study found. SMPY (pronounced "simpy") initially tested kids' intelligence using the SAT, university entrance exams, and other IQ tests. Researchers later began looking at additional factors like college enrollment and career paths later in life. What they found was the most-gifted kids went on to earn doctorates and graduate degrees, and hold patents at rates far above less-gifted children. Most sit among the top 5% of income earners."Whether we like it or not, these people really do control our society," Jonathan Wai, a psychologist at the Duke University Talent Identification Program, recently told Nature. The trouble is that genius kids often receive too little attention from their teachers, who may be inclined to write off bright students as having already met their potential.When SMPY researchers looked at how much attention teachers gave to these gifted children, they found that the overwhelming majority of class time was spent helping low-achieving students get to the middle.SMPY suggests that teachers should avoid teaching a one-size-fits-all curriculum and instead focus on doing the best they can to create individualized lesson plans for students. To help kids reach their potential, teachers and parents should consider moving a gifted child up a grade, SMPY suggests. When researchers compared a control group of gifted students who didn't skip a grade with those who did, the grade-skippers were 60% more likely to earn patents and doctorates — and more than twice as likely to get a doctorate in a field related to science, technology, engineering, or math. Being smart doesn't just mean having an ability to memorize facts or recall names and dates. SMPY has repeatedly found, throughout multiple follow-up analyses, that some of the smartest kids possess a great capacity for spatial reasoning. These kids have a talent for visualizing systems, such as the human circulatory system or the anatomy of a Honda. In 2013, follow-up surveys found a strong connection between spatial-reasoning skills and the number of patents filed and peer-reviewed papers published.

How Reading Rewires Your Brain for More Intelligence and Empathy - Fitness headlines promise staggering physical results: a firmer butt, ripped abs, bulging biceps. Nutritional breakthroughs are similar clickbait, with attention-grabbing, if often inauthentic—what, really, is a “superfood?”—means of achieving better health. Strangely, one topic usually escaping discussion has been shown, time and again, to make us healthier, smarter, and more empathic animals: reading. Reading, of course, requires patience, diligence, and determination. Scanning headlines and retweeting quips is not going to make much cognitive difference. If anything, such sweet nothings are dangerous, the literary equivalent of sugar addiction. Information gathering in under 140 characters is lazy. The benefits of contemplation through narrative offer another story. The benefits are plenty, which is especially important in a distracted, smartphone age in which one-quarter of American children don’t learn to read. This not only endangers them socially and intellectually, but cognitively handicaps them for life. One 2009 study of 72 children ages eight to ten discovered that reading creates new white matter in the brain, which improves system-wide communication.White matter carries information between regions of grey matter, where any information is processed. Not only does reading increase white matter, it helps information be processed more efficiently.Reading in one language has enormous benefits. Add a foreign language and not only do communication skills improve—you can talk to more people in wider circles—but the regions of your brain involved in spatial navigation and learning new information increase in size. Learning a new language also improves your overall memory. In one of the most fascinating aspects of neuroscience, language affects regions of your brain involving actions you’re reading about. For example, when you read “soap” and “lavender,” the parts of your brain implicated in scent are activated. Those regions remain silent when you read “chair.” What if I wrote “leather chair?” Your sensory cortex just fired.

Teens Aren’t Grasping the ‘Responsibilities of Adulthood,’ New Study Says - Today’s teens are on a slow road to adulthood, putting off risky behaviors from drinking to sex, but also delaying jobs, driving, dating and other steps towards independence, according to a new study based on 40 years of survey data.Compared to teens from the 70s, 80s and 90s, today’s teens “are taking longer to engage in both the pleasures and the responsibilities of adulthood,” said Jean Twenge, professor of psychology at San Diego State University and the lead author on the study published Tuesday in the journal Child Development.“The whole developmental pathway has slowed down,” she said, with today’s 18-year-olds living more like 15-year-olds once did.The study relies on seven nationally representative surveys repeated with 8 million teens, ages 13-19, over several decades.  It documents and combines several trends often explained as separate phenomena.But Twenge and her co-author Heejung Park, assistant professor of psychology at Bryn Mawr College, say the trends all point in the same direction – a slowing of teen development that matches a well-documented slowing of young adult development. While people in their early 20s now often act more like teens, young teens often act more like children, Twenge said. Eighth and ninth graders are less likely to have sex, drink, date, go out without parents or work for pay. Even by 12th grade, fewer engage in such adult activities than in the not-so-distant past, the data show. Some of the changes recorded among younger teens surveyed in 2010-2016, compared to those surveyed in the early 1990s:

  • • 29% of 9th graders had sex, down from 38%.
  • • 29% of 8th graders drank alcohol, down from 56%.
  • • 32% of 8th graders had worked for pay, down from 63%

Among 12th graders, data on most behaviors goes back to 1976.  In 2010-2016:

  • • 67% drank, down from 93% in the earlier era.
  • • 55% worked for pay, down from 76%.
  • • 73% had drivers’ licenses, down from 88%.
  • • 63% dated, down from 86%.
  • • 62% had had sex, down from 68% in the early 1990s, the earliest that data was collected.

The shifts are seen in all economic groups and all parts of the country. They are not explained by the demands of homework and extracurricular activities, which have not significantly increased, contrary to popular belief, the study says.

Why Democrats Should Dump ‘Free College’ - When congressional Democrats recently rolled out a new economic policy agenda aimed at staking out a new, populist-leaning course for the Democratic Party—dubbed “A Better Deal”—one idea was conspicuously missing: free college. As the signature idea of Vermont Senator Bernie Sanders, whose populist presidential campaign nearly upended the Democratic primary in 2016, “free college” would seem a natural fit for Democrats’ first post-election platform—both as a hat tip to the millions of younger progressives energized by Sanders’s candidacy, and as a rallying point in the fight against inequality. Instead, “A Better Deal” called for what some liberals consider thin gruel: more apprenticeships and employer incentives to invest in workers’ skills. The Nation’s Katrina vanden Heuvel, for example, argues the focus on skills “does nothing to address the fundamental unfairness that plagues the economy.” Others, such as Robert Borosage, are more blunt, attacking the emphasis on skills as a “charade” that is “clearly a nod to the still potent New Democrat forces in the party.” But the Senate Democrats’ strategy is the right move. If Democrats want to win the broadest possible support both in 2018 and beyond, “free college” is not the way to do it. In fact, a Democratic insistence on free college would guarantee the party continues to talk past a significant group of voters who don’t believe that college is the best or only path to the middle class. One reason for this lack of enthusiasm might be the price tag. Even the skimpiest of benefits would be enormously expensive in the aggregate. Sanders, who recently reintroduced his “College for All” legislation, estimates the cost of his plan, to be paid for by a new “transactions tax” on stock trades, would be $47 billion a year (and that’s assuming states pick up one-third of the tab). But there are other, deeper reasons why “free college” has failed to catch fire, particularly among the white working class. A sizeable share of voters don’t believe they would benefit from free college—or that the benefits would even flow their way. Many Americans also rightly believe that you don’t need a college degree to get a decent job, even in today’s globalized economy.

College in the U.S. Is More Expensive Than in Any Other Country in the World -- The price of a college degree is more expensive in America than anywhere else in the world, according to a new report from the Organization for Economic Co-operation and Development. The OECD looked at public and private college costs in its 35 member countries and found that higher education is priciest in the United States by a significant margin. Business Insider notes that while “one-third of countries do not charge tuition for public institutions,” and 10 countries have public tuition costs that average less than $4,000 annually, getting a diploma from a public institution in the U.S. generally runs about $8,202 a year. The closest competitor on that front is Chile, where public college costs average $7,654 annually. Private college costs in America outpace those in other countries by a staggering rate. On average, attending a private college in the U.S. will set students—and their families—back by about $21,189. No other country even comes close in this regard, as illustrated by a comparison chart from Business Insider. Both public and private college tuition rates in the U.S. have increased at a rate higher than inflation, making higher education prohibitively expensive for a lot of American families. A 2014 investigation by Mother Jones found the “cost of undergraduate education is 12 times higher than it was 35 years ago” and “the indexed price of college tuition and fees skyrocketed by more than 1,122 percent since 1978.” As a result, students are forced to take on debts in the form of public and private loans to the tune of roughly $100 billion a year, according to CNBC. The outlet reports that the total cost of student debt now stands at $1.2 trillion.

While the rest of the world invests more in education, the U.S. spends less - Hechinger Report  --The world’s developed nations are placing a big bet on education investments, wagering that highly educated populaces will be needed to fill tomorrow’s jobs, drive healthy economies and generate enough tax receipts to support government services.Bucking that trend is the United States.U.S. spending on elementary and high school education declined 3 percent from 2010 to 2014 even as its economy prospered and its student population grew slightly by 1 percent, boiling down to a 4 percent decrease in spending per student. That’s according to the Organization for Economic Cooperation and Development’s annual report of education indicators, released last week.Over this same 2010 to 2014 period, education spending, on average, rose 5 percent per student across the 35 countries in the OECD. In some countries it rose at a much higher rate. For example, between 2008 and 2014, education spending rose 76 percent in Turkey, 36 percent in Israel, 32 percent in the United Kingdom and 27 percent in Portugal. For some countries, it’s been a difficult financial sacrifice as their economies stalled after the 2008 financial crisis. To boost education budgets, other areas were slashed. Meanwhile, U.S. local, state and federal governments chose to cut funding for the schoolhouse.  “Overall (U.S.) education spending has been cut quite severely in the last few years,”said Andreas Schleicher, who heads the OECD directorate that issued the report.  “That clearly puts constraints on the environment you have for learning.”

 1 In 5 Students Endorse Violence To 'Prevent' Controversial Speakers - A new survey published by The Brookings Institution finds that about one-in-five undergraduate students approve of using violence to shut down controversial speakers. A majority of undergraduate students at U.S. four-year colleges and universities also agreed with a hypothetical protest in which a group “opposed to the speaker disrupts the speech by loudly and repeatedly shouting so that the audience cannot hear the speaker.”According to the survey, 51 percent of students agreed that such a demonstration would be acceptable, while 49 percent disagreed. Not surprisingly, the response to the hypothetical scenario was also largely partisan, with 62 percent of Democrats approving of the protest, compared to just 39 percent of Republicans . “I find the numbers in the above table to be highly concerning, because they show that a very significant fraction of students, across all categories, believe it is acceptable to silence (by shouting) a speaker they find offensive,” wrote John Villasenor, the author of the survey and a Brookings Nonresident Senior Fellow.The study further found that 19 percent of responders said that they approved of using violence “to prevent the speaker from speaking.” An 81 percent majority, on the other hand, did not approve of the violent approach.“A surprisingly large fraction of students believe it is acceptable to act—including resorting to violence—to shut down expression they consider offensive,” Villasenor wrote. While 39 percent of responders indicated that hate speech is protected by the First  Amendment, 44 percent said that it is not protected by the document. Another 16 percent remained undecided.

Brown University To Offer Segregated Student Dinners For Black, Muslim Students - To promote “racial reconciliation” after the deadly clashes between white nationalists and counterprotesters in Charlottesville last month, Brown University plans to offer segregated events to its black students and female Muslim students.The university received a $30,000 grant from the Association of American Colleges and Universities, which represents liberal arts schools, to create a campus center whose mission is to “break down racial hierarchies and create a positive narrative about race in the community,” according to The Brown Daily Herald.These grants, provided with the assistance of the Newman’s Own Foundation and W.K. Kellogg Foundation, will go towards hosting racially and religiously segregated “dinner discussion groups.” These discussions are being led by Brown University Chaplain Rev. Janet Cooper Nelson, who told The Daily that “one [group will be] for black students and the other [will be for] for Muslim women on campus.”Nelson told The Daily she hopes that the Muslim women’s dinner group will “allow the women to engage in topics such as the intersection of race, Islam and gender fluidity.”Nelson did not respond to The College Fix’s request for comment, nor did Brown’s media relations department.The Fix also reached out to the university’s Black Student Union for comment on the black student discussion dinner. The group did not respond.The Association of American Colleges and Universities has charged Brown and nine other universities with “addressing the historic and contemporary effects of racism and leading transformative change,” according to a press release from Brown. The initiative seeks to “educate, prepare and inspire the next generation of leaders to advance justice and build equitable communities.”

CFPB Settles With Owners of Wall Street's Worst Student Debt -- As many as hundreds of thousands of borrowers accused of defaulting on their student loans may not have to pay a dime over the next several months, or perhaps ever, under an unusual settlement Monday between federal regulators and the owner of a series of trusts that form one of the nation's largest owners of private student debt.The agreement with the Consumer Financial Protection Bureau, which was filed in Delaware federal court and still requires a judge’s approval, calls for an audit that consumer lawyers have called unprecedented. Under it, the National Collegiate Student Loan Trusts must audit their book of more than $8 billion of loans, many of them in default, to prove they can document that they own each loan and that it's not too old to collect. Until it is complete, investors who own the bonds that contain those loans won’t receive any cash from borrowers, even those making steady payments. Instead, the money will go into an escrow account.The settlement seeks to resolve allegations that the trusts illegally collected from tens of thousands of distressed borrowers using deceptive or unfair means, and that debt collectors and law firms for them flooded the nation’s courts with faulty lawsuits to collect.According to the CFPB, those it examined were rife with irregularities: Some were filed well past the statute of limitations, others lacked paperwork establishing that the listed creditor actually had a right to collect, and many contained misleading statements. Debt collectors trying to process them, according to the bureau, were so inundated with paperwork that they had interns and mailroom clerks sign critical documents. The loans, which had been securitized and sold to investors, collectively have higher default rates than any student debt Wall Street has ever bundled. More than $5 billion, including interest, of the $12 billion in debt originally bundled into securities ended up in default.

Student loan companies reach $21.6 million settlement over dubious debt collection lawsuits - Thousands of people who have been sued over past-due education debt are set to receive restitution from a $21.6 million government settlement with one of the largest owners of private student loans, National Collegiate Student Loan Trusts.On Monday, the Consumer Financial Protection Bureau (CFPB) said National Collegiate and its debt collector, Transworld Systems Inc. (TSI), filed lawsuits that relied on false or misleading legal documents. Those cases often involved the collection of debt that the company could not prove that it owned or that consumers owed, according to the CFPB complaint.National Collegiate comprises 15 trusts that own more than 800,000 private student loans. In the lead-up to the 2008 financial crash, the trusts purchased and securitized loans and then sold notes to investors, a scheme that mirrored what occurred at the same time in the housing market. And as in the subprime mortgage crisis, the paperwork associated with those student loans was often flawed or incomplete, the complaint said. As people defaulted on those private student loans in droves, National Collegiate hired Transworld to collect. Between November 2012 and April 2016, the debt collection agency initiated nearly 95,000 lawsuits across the country. Investigators at the CFPB identified more than 2,000 suits in which National Collegiate could neither produce proof of ownership of the debt or a promissory note, which borrowers sign promising to repay the loan. Nevertheless, Transworld employees signed sworn affidavits claiming to have reviewed account records they never read, according to the complaint. Investigators say the collection agency at times instructed interns and mailroom clerks to execute affidavits when there were backlogs. These efforts helped yield National Collegiate more than $21 million in judgments against borrowers.

Study Shows Student Debt Delays Home Buying By Seven Years – Mish - The Student Loan Debt and Housing Report 2017 by the National Association of Realtors and the nonprofit group American Student Assistance shows the obvious: Student debt delays household formation, home buying, and saving. The U.S. currently has a student debt load of $1.4 trillion, which accounts for 10 percent of all outstanding debt and 35 percent of non-housing debt. The magnitude of the debt continues to grow in size and share of the overall debt in the economy. While this amount of debt has risen, the homeownership rate has fallen, and fallen more steeply among younger generations.Student loan debt impacts other life decisions including employment, the state the debt holder lives in, life choices such as continuing education, starting a family, and retirement.  Twenty-two percent were delayed by at least two years in moving out of a family member’s home after college due to their student loans.Among non-homeowners, 83 percent cite student loan debt as the factor delaying them from buying a home. This is most frequently the case due to the fact that the borrowers cannot save for a downpayment because of their student debt. Among homeowners, 28 percent say student debt is impacting the ability to sell their existing home and move to a different home. The delay in buying a home among non-homeowners is seven years and three years for homeowners.

  • Before attending college, 28 percent of borrowers knew generally the school “might be expensive” or “might be cheap”, but had no further information.
  • More than one-quarter of borrowers had an understanding of tuition, but had little understanding of other costs such as fees and housing expenses.
  • One in five borrowers understood all the costs including tuition, fees, and housing.
  • Thirty-two percent of student loan borrowers surveyed had defaulted or forbore on their student loan debt
  • Two-fifths of borrowers who had personal incomes of less than $25,000 in 2016 had defaulted or forbore on their student loan debt in the past.
  • Among life choices, more than half of respondents believe they are delayed in continuing their education or starting a family due to student loan debt.
  • Forty-one percent would like to get married, but are delayed from marriage due to their student loan debt.
  • Only 13 percent of respondents did not have a life event delayed due to debt.
  • 28 percent of respondents rent with roommates.
  • Fifteen percent live with friends or family and pay rent, and 15 percent live with friends and family and do not pay rent.
  • Twenty percent own their own home and 16 percent rent solo.
  • Thirty-five percent of younger millennials live with family (both paying and not paying rent) compared to just 24 percent of older millennials.

CalPERS Illegally Trying to Hide Its Scheming to Hand Over Private Equity to BlackRock - Yves Smith - CalPERS continues to thumb its nose at the law. The latest example involves its plan to give enormous power and profit to BlackRock, a financial firm that damaged CalPERS in the past by putting it in the Stuyvesant Town real estate deal, in which CalPERS lost its entire $500 million investment.1 It’s astonishing to see an organization refuse to allow for open discussion of fundamentally important policy decisions, as required by the Bagely-Keene Open Meeting Act. That intransigence is made even worse by the fact that CalPERS is seriously considering implementing a strategy that would harm its beneficiaries and California taxpayer. CalPERS plans to introducing another middleman into its most expensive investment strategy, private equity. That would increase already high private equity costs and lower returns. Mind you, this is the antithesis of the approach CalPERS uses for every other investment strategy, where it correctly fixates on cost reduction, to the degree that CalPERS has misrepresented data to exaggerate how much it has lowered costs. Later in the post, we reproduce an e-mail by board candidate Margaret Brown to the members of the CalPERS board, along with its CEO Marcie Frost and general counsel, Matt Jacobs, vigorously objecting to how staff intends to discuss this and other agenda items impermissibly in secret. CalPERS makes no pretense that it has any legal justification for this move. Note that the default position of Bagley-Keene is that all deliberations of governmental bodies are to be held in public; private discussions must be put on the agenda with a citation of the section of law that allows for the discussion to be in secret. You can see there is no such notice:

1 Million Ohio Public Employees Face Pension Cuts As Another Ponzi Teeters On The Brink - We've written frequently of late about the pension crisis in Kentucky where pensioners are facing potentially catastrophic benefit cuts as their politicians finally admit that they've been sold a fantasy for decades (see: Pension Consultant Offers Dire Outlook For Kentucky: Freeze Pension And Slash Benefits Or Else).Unfortunately, Kentucky is not unique as there is a never-ending stream of similar pension failures popping up daily all around the country.  The latest such example comes to us from Ohio as the Dayton Daily News notes that the Ohio Public Employees Retirement System (OPERS) has been forced to consider COLA cuts for its 1 million pensioners in order to keep the fund solvent.Ohio’s biggest public pension system is considering cutting the cost of living allowances for its 1-million members as a way to shore up the long-term finances of the fund.Ohio Public Employees Retirement System trustees on Wednesday discussed options that could affect all current and future retirees, including tying the cost of living allowance to inflation and capping it and delaying the onset of the COLA for new retirees.No decision has been made and trustees will discuss the options again in October. So far, some 72,000 members responded to an OPERS survey about possible changes. OPERS spokesman Todd Hutchins said 70 percent of retirees responding to the survey report that they prefer that the COLA be capped, rather than frozen.So how bad is OPERS?  Per the latest valuation, Ohio taxpayers are on the hook for a roughly $20 billion underfunding.  Ironically, the fund ended 2016 with the highest underfunding in it's history, after being nearly fully funded in 2007, despite a 275% surge in the S&P off the lows in 2009.  Perhaps someone can explain to us how these pensions stand a chance of ever again being fully funded if they can't even manage to improve their balance sheet during one of the biggest equity bubbles in history?

This $700 Billion Public Employee Ticking Time Bomb Is Only 6.7% Funded; Most States Are Under 1% - We've spent a lot of time of late discussing the inevitable public pension crisis that will eventually wreak havoc on global financial markets.  And while the scale of the public pension underfunding is unprecedented, with estimates ranging from $3 - $8 trillion, there is another taxpayer-funded retirement benefit that has been promised to union workers over the years that puts pensions to shame...at least on a percentage funded basis.Other Post-Employment Benefits (OPEB), like pensions, are a stream of future payments that have been promised to retirees primarily to cover healthcare costs.  However, unlike pensions, most government entities don't even bother to accrue assets for this massive stream of future costs resulting in $700 billion of liabilities that most taxpayer likely didn't even know existed. As a study from Pew Charitable Trusts points out today, the average OPEB plan in the U.S. today is only 6.7% funded (and that's if you believe their discount rates...so probably figure about half that amount in reality) and many states around the country are even worse.States paid a total of $20.8 billion in 2015 for non-pension worker retirement benefits, known as other post-employment benefits (OPEB).  Almost all of this money was spent on retiree health care. The aggregate figure for 2015, the most recent year for which complete data are available, represents an increase of $1.2 billion, or 6 percent, over the previous year. The 2015 payments covered the cost of current-year benefits and in some states included funding to address OPEB liabilities. These liabilities—the cost of benefits, in today’s dollars, to be paid in future years—totaled $692 billion in 2015, a 5 percent increase over 2014. State OPEB funded ratios vary widely, from less than 1 percent in 19 states to 92 percent in Arizona. As Figure 1 shows, only eight have funded ratios over 30 percent. These states typically follow pre-funding policies spelled out in state law. Many of them also make use of the expertise of staff from the state pension system to invest and manage plan assets.

The Obamacare "Death Spiral": Health Plans Now Cost Employers More Than A New Car -- With the Graham-Cassidy Obamacare replacement now officially dead, it appears Senate Republicans will be unable to pass a repeal-and-replace bill before the Sept. 30 deadline announced by the Senate Parliamentarian arrives – though it’s impossible to rule out another long-shot plan gaining momentum in the coming days.After the deadline, Senate Republicans would need 60 votes for their repeal-and-replace bill, effectively killing the repeal-and-replace effort, at least for now.As Republicans struggle to fulfill their campaign promises to the American people, the Wall Street Journal has published a report showing that rising premiums are forcing some small business owners to stop offering benefits, the latest sign that Democrats ignored Republican rhetoric about the bill’s job-killing potential at their own political peril.As we’ve reported time and time again, the bill has increased cost pressures on businesses, forcing them lay off employees or pare back benefits to stay in business.According to WSJ, the average cost of health coverage offered by employers pushed toward $19,000 for a family plan this year, while the share of firms providing insurance to workers continued to edge lower, according to a major survey by the Kaiser Family Foundation.

Maryland premiums for ACA policies will could see up to a 50% increase in 2018 -- The rates are locked in, and they're far from affordable."There are no easy answers with this, folks are really gonna be hurt," said Maryland Insurance Commissioner Al Redmer Jr.He says the spike in premiums for Marylanders is devastating.Redmer tells ABC 2 News some of the 243,000 people enrolled in health insurance plans through the exchange this year will be spending the same amount for health care as they do on their mortgage."We have real families in Maryland who are going to receive significant premium increases, and they have to make some significant decisions for them and their families," Redmer said.Only two carriers will offer individual coverage on the market for 2018.  Depending on the plan and company, people will see an average hike of 22.6% to 49.9%.The Maryland Insurance Administration says both companies proved they need those increases to stay in business, telling officials they have lost a combined $447-million since policies started selling under the affordable care act back in 2014.Sobering numbers that could cause folks to drop coverage, and leave carriers in the red."The losses incurred by the insurance carriers since the Affordable Care Act has been unsustainable, and the premium increases that result from that are unsustainable as well,” said Redmer.  “If it doesn’t get fixed, and it doesn't get fixed soon, we're gonna have some catastrophic consequences."Redmer says the entire program is close to collapse, and it's up to the Feds in Washington to stop the affordable care act marketplace from a death spiral.

2018 ACA premium requests get OK from state insurance chief - The state's insurance commissioner has approved the premiums requested by the three companies lined up to sell insurance on the Obamacare exchange in Tennessee in 2018. BlueCross BlueShield of Tennessee, Cigna and Oscar Health each received approval from Julie Mix McPeak, commissioner of the Tennessee Department of Commerce and Insurance. Cigna premiums will increase an average 42.1 percent, while BlueCross BlueShield of Tennessee asked for 21 percent, most of which is attributed to federal uncertainty. Oscar Health is new so there is no prior year comparison. Most Tennesseans, more than 80 percent, who buy inidivdaul insurance receive tax credit that offsets the premium costs. Uncertainty — wrought by the ongoing debate over Obamacare repeal-and-replace legislation and decisions by the White House and HHS officials — have clouded the premium request process, and led to higher requests. Cost-sharing reductions, a subsidy that offsets out-of-pocket costs for some shoppers, are divisive in Washington, D.C. There is no long-term commitment that CSRs will be paid to insurers, and the decision is being made monthly. BCBST attributes nearly all of its average 21 percent premium increase request to the unknowns of the upcoming year. The latest Affordable Care Act repeal-and-replace bill, Graham-Cassidy, would eliminate the individual and employer mandate, which could potentially throw the 2018 insurance market. Sen. Lamar Alexander has halted the hunt for a bipartisan fix for the exchange, which McPeak said disappointed her. She and Gov. Bill Haslam testified before Alexander's committee earlier this month. 

Health Insurance Rate Hike Sets Record For New Mexico Exchange | KRWG: (AP) — Regulators have approved the largest health insurance premium increase in the four-year history of New Mexico's subsidized exchange, state Insurance Superintendent John Franchini said Wednesday. The state's top insurance regulator said record-setting rate increases in 2018 are heavily influenced by uncertainty about whether the federal government will block or discontinue subsidies to insurers. President Donald Trump has repeatedly threatened to halt cost-sharing payments to insurance companies in his drive to dismember President Barack Obama's health care law. About 55,000 New Mexico residents sign up each year for federally subsidized insurance through the state's exchange, known as beWellnm. Average premium increases for 2018 will range from 36 percent to 41 percent for mid-level insurance coverage, according to an analysis by the Office of the Superintendent of Insurance. "This is the largest increase in the last four years," Franchini said. "Our actuaries — who are very, very conservative — have reviewed this and they don't see any excess profit in these increases." He noted that New Mexico remains among the 10 states with the lowest premiums in the country, and emphasized that consumers should compare their current insurance policy with offerings from other companies on the exchange to conserve spending.Rising rates among New Mexico's four marketplace insurance providers appear to be outpacing the national average for individually purchased health insurance. The Congressional Budget Office this month estimated average individually purchased premiums nationwide will grow by about 15 percent next year, in large part because of market nervousness over actions Trump might take. 

Illinois submits big Obamacare rate increases to the feds -  Hundreds of thousands of Illinois consumers who buy health insurance on the state's Obamacare exchange will likely see average rates increase by 16 to 37 percent next year for the lowest-priced plans, according to a new analysis. The Illinois Department of Insurance submitted rates to the federal government Wednesday that would increase the average cost of the lowest-priced silver plans by 35 percent statewide. The lowest-priced bronze-level plans would increase, on average, by 20 percent, and the lowest-priced gold plans would increase by 16 percent, according to a department analysis obtained by the Tribune. For example, a 21-year-old nonsmoker could pay $315 a month for the lowest-priced silver plan in Cook County next year, compared with $221 a month this year, according to the analysis. A 21-year-old nonsmoker in DuPage and Kane counties could pay $338 a month next year for the lowest-priced silver plan, versus $266 this year. The analysis follows the release last month of proposed rate increases from insurers, which in many cases showed large average jumps over last year. The new analysis shows average increases for different levels of plans across the state, breaks down some of the likely increases by county and shows which insurers will offer plans where. Rates will not be finalized until October, shortly before consumers may start choosing plans during open enrollment, which starts Nov. 1.Illinois consumers will also see less competition among insurance providers on the exchange, according to the analysis. In 13 counties next year, only one insurer will offer individual plans — nearly double the number of Illinois counties that have only one insurer on the exchange this year. Counties that will be limited to one choice include Lake, McHenry and DeKalb as well as a number in the northwest corner of the state and southern Illinois. 

 Employer-provided health insurance now costs nearly $19,000 -- The average cost of health coverage offered by employers pushed toward $19,000 for a family plan this year, as the share of firms providing insurance to workers continued to edge lower, according to a major survey.Annual premiums rose 3% to $18,764 for an employer plan in 2017, from $18,142 last year, the same rate of increase as in 2016, according to an annual poll of employers performed by the nonprofit Kaiser Family Foundation along with the Health Research & Educational Trust, a nonprofit affiliated with the American Hospital Association. The trend of relatively gradual premium increases has continued for several years, with the growth of premiums damped by a shift toward bigger out-of-pocket costs for employees in the form of high deductibles—a move that slowed this year, as average deductibles were roughly flat compared with 2016. Still, the rise of premiums over time have resulted in family health plans that can annually cost more than a new car, with the cost split between firms and employees. Employees paid on average $5,714, or 31%, of the premiums, for a family plan in 2017, according to Kaiser.

Amid Opioid Crisis, Insurers Restrict Pricey, Less Addictive Painkillers – NYT  --At a time when the United States is in the grip of an opioid epidemic, many insurers are limiting access to pain medications that carry a lower risk of addiction or dependence, even as they provide comparatively easy access to generic opioid medications.The reason, experts say: Opioid drugs are generally cheap while safer alternatives are often more expensive.Drugmakers, pharmaceutical distributors, pharmacies and doctors have come under intense scrutiny in recent years, but the role that insurers — and the pharmacy benefit managers that run their drug plans — have played in the opioid crisis has received less attention. That may be changing, however. The New York State attorney general’s office sent letters last week to the three largest pharmacy benefit managers — CVS Caremark, Express Scripts and OptumRx — asking how they were addressing the crisis.ProPublica and The New York Times analyzed Medicare prescription drug plans covering 35.7 million people in the second quarter of this year. Only one-third of the people covered, for example, had any access to Butrans, a painkilling skin patch that contains a less-risky opioid, buprenorphine. And every drug plan that covered lidocaine patches, which are not addictive but cost more than other generic pain drugs, required that patients get prior approval for them. In contrast, almost every plan covered common opioids and very few required any prior approval.The insurers have also erected more hurdles to approving addiction treatments than for the addictive substances themselves, the analysis found.

Increasing number of children arrive at emergency departments addicted to opioids  - Showing the opioid epidemic knows no age limits, new research suggests more than 100 children test positive for opioid addiction or dependency each day in U.S. emergency departments.The study abstract, "Opioid abuse in children: An emerging public health crisis," will be presented on Monday, Sept. 18, during the American Academy of Pediatrics (AAP) 2017 National Conference & Exhibition in Chicago. Researchers performed a retrospective analysis of the 2008-2013 data from the Nationwide Emergency Department (ED) Sample, the largest all-payer ED database in the United States. They found the number of ED visits by patients age 21 and younger for any reason who were diagnosed with addiction or dependency on opioids - which include prescription painkillers as well as illicit drugs such as heroin -- rose from 32,235 in 2008 to 49,626 in 2013. "It was very concerning to see that by the last year we studied, an average of 135 children each day were testing positive for opioid addiction or dependency in emergency departments," said Veerajalandhar Allareddy, MD, MBA, one of the abstract's authors and medical director of the pediatric intensive care unit at the University of Iowa Stead Family Children's Hospital. " In our opinion, this is a pediatric public health crisis," he said.  Allareddy said nearly one-third of the children were admitted as inpatients, regardless of cause, to the same hospital as the ED visit. Pediatric patients living in high-income households were more likely to be hospitalized rather than routinely discharged, the data show, while uninsured patients were less likely to be hospitalized.

The science behind the 15 most common smart drugs - Not all drug users are searching for a chemical escape hatch. A newer and increasingly normalized drug culture is all about heightening one’s current relationship to reality—whether at work or school—by boosting the brain’s ability to think under stress, stay alert and productive for long hours, and keep track of large amounts of information. In the name of becoming sharper traders, medical interns, or coders, people are taking pills typically prescribed for conditions including ADHD, narcolepsy, and Alzheimer’s. Others down “stacks” of special “nootropic” supplements.For obvious reasons, it’s difficult for researchers to know just how common the “smart drug” or “neuro-enhancing” lifestyle is. However, a few recent studies suggest cognition hacking is appealing to a growing number of people. A survey conducted in 2016 found that 15% of University of Oxford students were popping pills to stay competitive, a rate that mirrored findings from other national surveys of UK university students. In the US, a 2014 study found that 18% of sophomores, juniors, and seniors at Ivy League colleges had knowingly used a stimulant at least once during their academic career, and among those who had ever used uppers, 24% said they had popped a little helper on eight or more occasions. Anecdotal evidence suggests that pharmacological enhancement is also on the rise within the workplace, where modafinil, which treats sleep disorders, has become particularly popular. In Silicon Valley, where the Nootropic market is most developed, devotees typically take a cocktail of pills, often mixing natural supplements that are readily available and legal, with lab-designed drugs that may be unregulated in the US, but still easily purchased online and shipped in from other countries. But do these brain-hacking drugs actually make you smarter? The answers are murky at best. Here’s a cheat sheet of 15 of the most commonly touted cognitive-boosting pills that have also been studied in clinical trials.

How flying seriously messes with your mind - BBC -- An emerging body of research is suggesting that soaring 35,000ft (10km) above the ground inside a sealed metal tube can do strange things to our minds, altering our mood, changing how our senses work and even making us itch more. There can be no doubt that aircraft cabins are peculiar places for humans to be. They are a weird environment where the air pressure is similar to that atop an 8,000ft-high (2.4km) mountain. The humidity is lower than in some of the world's driest deserts while the air pumped into the cabin is cooled as low as 10°C (50F) to whisk away the excess heat generated by all the bodies and electronics onboard.The reduced air pressure on airline flights can reduce the amount of oxygen in passengers’ blood between 6 and 25%, a drop that in hospital would lead many doctors to administer supplementary oxygen. For healthy passengers, this shouldn’t pose many issues, although in the elderly and people with breathing difficulties, the impact can be higher. There are some studies, however, that show even relatively mild levels of hypoxia (deficiency in oxygen) can alter our ability to think clearly. At oxygen levels equivalent to altitudes above 12,000ft (3.6km), healthy adults can start to show measurable changes in their memory, their ability to perform calculations and make decisions. This is why the aviation regulations insist that pilots must wear supplementary oxygen if the cabin air pressure is greater than 12,500ft.  Strangely, the air pressure at altitudes of over 7,000ft (2.1km) has been found to actually increase reaction times – great news for those who like to play computer games during their flight. But there is some research that shows there can also be small decreases in cognitive performance and reasoning at oxygen levels found at 8,000ft (2.4km) – the same as those found in airline cabins. For most of us, this is unlikely to cloud our thinking much though. But Hinkelbein says the mild hypoxia we experience during flights can have other, more easily recognised effects on our brains – it makes us tired. Studies in hypobaric chambers and on non-acclimatised military personnel arriving in mountainous regions have shown short-term exposure to altitudes of at least 10,000ft (3km) can increase fatigue, but the effects could start at lower altitudes in some people. Flying also plays havoc with our other senses too. The combination of low air pressure and humidity can reduce the sensitivity of our taste buds to salt and sweet by up to 30%.

WHO warns the world is running out of antibiotics -  There aren’t enough truly new antibiotics being developed, especially for the most concerning antibiotic-resistant infections, according to a WHO report released Tuesday. The United Nations health agency has aired its concerns about antibiotic resistance, which makes it more difficult to treat infections, for some time. Some of the group’s latest moves included updating guidelines for treating sexually transmitted infections and cautioning that just three antibiotics are being developed to treat gonorrhea, a “fairly grim” situation. But the latest WHO report takes a broad and prospective look at antibiotic development, and what it describes is not a pretty picture. “Antimicrobial resistance is a global health emergency that will seriously jeopardize progress in modern medicine,” said Tedros Adhanom Ghebreyesus, the WHO’s director-general. Without more investment in research and development, “we will be forced back to a time when people feared common infections and risked their lives from minor surgery.” Public health officials have long been concerned about antibiotic resistance, which occurs when bacteria mutate and become immune to a given antibiotic. Overuse or incorrect use of antibiotics are key contributing factors, as is antibiotic use in animals that are then consumed by humans.  But drug development is lagging behind, especially for drug-resistant tuberculosis and other infections the WHO has designated as high priority, the U.N. health agency said.  Of 51 new products in development for antibiotic-resistant infections, the WHO believes that only eight are innovative and add value to current options. And because drug development is a drawn-out process, most of it unsuccessful, current efforts could result in only about 10 new approvals in the next five years, the report said.  Even then, “these potential new treatments will add little to the already existing arsenal” because most of the products being developed today are essentially versions of existing antibiotic classes, the report said. Thus, most products usually can’t work against many current types of resistance, and will only be helpful in the short term.

Fluoride exposure in utero linked to lower IQ in kids, study says - Increased levels of prenatal fluoride exposure may be associated with lower cognitive function in children, a new study says. The study, published Tuesday in the journal Environmental Health Perspectives, evaluated nearly 300 sets of mothers and children in Mexico and tested the children twice for cognitive development over the course of 12 years. Fluoride is not added to public water supplies in Mexico, but people are exposed through naturally occurring fluoride in water and fluoridated salt and supplements.The study found a drop in scores on intelligence tests for every 0.5 milligram-per-liter increase in fluoride exposure beyond 0.8 milligrams per liter found in urine. However, although the researchers found a potential connection to a child's exposure to fluoride in utero, they found no significant influence from fluoride exposure on brain development once a child was born."Childhood exposure to fluoride is safer than prenatal. There is pretty good science now to support the fact that the fetal system tends to be more sensitive to environmental toxicants than once the child is born," said the study's lead author, Howard Hu, founding dean of the Dalla Lana School of Public Health at the University of Toronto.The authors measured fluoride exposure for the Mexican mothers and their children by looking at the chemical content in their urine. "Since we're using an integrated biological marker, it will give you a fairly standardized measure," Hu explained. Previous studies measured fluoride exposure by analyzing it in the environment, such as in water. On average, the researchers found that the mothers had 0.90 milligrams per liter of fluoride in their urine. Currently, there have been no such measurements for pregnant American women.

Women of childbearing age around world suffering toxic levels of mercury - Women of childbearing age from around the world have been found to have high levels of mercury, a potent neurotoxin which can seriously harm unborn children. The new study, the largest to date, covered 25 of the countries with the highest risk and found excessive levels of the toxic metal in women from Alaska to Chile and Indonesia to Kenya. Women in the Pacific islands were the most pervasively contaminated. This results from their reliance on eating fish, which concentrate the mercury pollution found across the world’s oceans and much of which originates from coal burning. The most extreme levels were found in women from sites in Indonesia where mercury is heavily used in small-scale gold mining and where fish is also commonly eaten. Such gold mining leads to serious mercury pollution and is also a source of harm to women in Kenya, Paraguay and Myanmar. Industrial pollution is another source of mercury, and the research found this affected women in Nepal, Nigeria and Ukraine. “Millions of women and children in communities mining gold with mercury are condemned to a future where mercury impairs the health of adults and damages the developing brains of their offspring,” said Yuyun Ismawati, an Indonesian woman from Ipen, the coalition of NGOs that produced the scientific report. “As long as the mercury trade continues, so too will the mercury tragedy.” Cook Islands resident Imogen Ingram, from the Island Sustainability Alliance, learned that her own mercury levels were two-and-half times higher than the US Environmental Protection Agency’s safety threshold. “It is really alarming to learn that you have, without knowing, passed on mercury to your child,” she said. “Mercury contamination across the Pacific Islands is high because we eat fish. But I do not want to be told not to eat fish. Coal-fired power, one of the primary sources of mercury pollution in the oceans, is the real offender. It is time to phase it out.” 

Flint Water Crisis Likely Increased Fetal Deaths, Study Shows -  The water crisis in Flint, Michigan, may have reduced fertility rates and increased miscarriages and fetal deaths, according to new research exploring one impact of lead poisoning on the population. The number of fetal deaths ― pregnancies that lasted longer than 20 weeks but didn’t result in a live birth ― increased 58 percent from 2014 to 2016, when the city had higher amounts of lead in its water, researchers found. The number of live births declined 12 percent. Overall, “between 198 and 276 more children would have been born had Flint not enacted the switch in water,” according to the working paper by Daniel Grossman of West Virginia University and David Slusky of the University of Kansas. Using other Michigan cities for comparison, the pair looked at fertility and fetal death rates in Flint before and after the city’s water became contaminated with lead.“It’s a tragic but unintentionally well-set-up natural experiment,” Slusky said in an interview. Flint is one of many American cities that installed lead water pipes in the 20th century, despite dangers including child brain damage and a range of health problems. The deadly neurotoxin has since been banned from most household applications, but millions of lead water service lines are still in use around the country. Rather than replace them, federal law requires cities to add chemicals to their water so it forms a protective coating on the inside of the pipes, thereby preventing corrosion that allows lead particles to leach into people’s drinking water. Flint failed to treat its water correctly after changing its water source to the Flint River in 2014. Most of the effects of leaded water can only be observed through population-level analysis. As water utilities love to point out, even if somebody has documented higher lead levels in his or her blood, that person can’t definitively say what caused the increase. It could have been the water, but it also could have been dust from old paint or lead-contaminated dirt.

Flint’s lead-poisoned water had a ‘horrifyingly large’ effect on fetal deaths, study finds -- The fertility rate in Flint, Mich., dropped precipitously after the city decided to switch to lead-poisoned Flint River water in 2014, according to a new working paper. That decline was primarily driven by what the authors call a “culling of the least healthy fetuses” resulting in a “horrifyingly large” increase in fetal deaths and miscarriages. The paper estimates that among the babies conceived from November 2013 through March 2015, “between 198 and 276 more children would have been born had Flint not enacted the switch in water,” write health economists Daniel Grossman of West Virginia University and David Slusky of Kansas University. In April 2014, Flint decided to draw its public water supply from the Flint River, a temporary measure intended to save costs while the city worked on a permanent pipeline project to Lake Huron. Residents immediately began complaining about the odor and appearance of the water, but well into 2015 the city was still assuring residents that the water was safe to drink. Subsequent testing by Flint authorities and outside agencies turned up lead levels that in some cases were dozens or hundreds times higher than the Environmental Protection Agency's safety threshold. A September 2015 study showed that the proportion of Flint children with high lead levels in their blood had roughly doubled after the water change. The city finally switched back to Lake Huron water in October 2015. The harmful effects of lead exposure on children's health are well-documented. They include cognitive deficiencies, increased antisocial behavior, lower educational attainment, and a host of problems affecting the brain, kidneys and liver. Less well-known are lead's effects on fetal health. Literature reviewed by Grossman and Slusky shows that maternal lead exposure is linked to “fetal death, prenatal growth abnormalities, reduced gestational period, and reduced birth weight.” A 2013 study, for instance, found an increase in fetal deaths and a reduction of births in Washington, D.C., from 2000 to 2003, when lead levels were elevated in the city's drinking water. 

Move over malaria: Mosquitoes carrying Zika, dengue may thrive in warmer Africa | Reuters: (Thomson Reuters Foundation) - From deadly droughts and destroyed crops to shrinking water sources, communities across sub-Saharan Africa are struggling to withstand the onslaught of global record-breaking temperatures. But the dangers do not end there. Rising heat poses another threat - one that is far less known and studied but could spark disease epidemics across the continent, scientists say. Mosquitoes are the menace, and the risk goes beyond malaria. The Aedes aegypti mosquito, which spreads debilitating and potentially deadly viruses, from Zika and dengue to chikungunya, thrives in warmer climates than its malaria-carrying cousin, known as Anopheles, say researchers at Stanford University. In sub-Saharan Africa, this means malaria rates could rise in cooler areas as they heat up, but fall in hotter places that now battle the disease. In those areas, malaria - one of the continent’s biggest killers - may be rivaled by other vector-borne diseases as major health crises. “As temperatures go past 25 degrees Celsius (77 degrees Fahrenheit), you move away from the peak transmission window for malaria, and towards that of diseases such as dengue,” said Erin Mordecai, an assistant professor at Stanford. “We have this intriguing prospect of the threat of malaria declining in Africa, while Zika, dengue and chikungunya become more of a danger,” she told the Thomson Reuters Foundation.Besides a warming planet, scientists fear growing urbanization across Africa could also fuel the transmission of diseases carried by the Aedes aegypti mosquito, which flourishes in cities and slums - the opposite of the country-loving Anopheles. 

Global hunger rises for first time in decade: U.N. agencies | Reuters: (Thomson Reuters Foundation) - Global hunger levels have risen for the first time in more than a decade, now affecting 11 percent of the world’s population, as conflict, climate change and economic woes bite, U.N. agencies said on Friday. Last year, 815 million people were hungry - 38 million more than in 2015 - the five agencies said in the first global assessment since governments set an international target to eliminate hunger and malnutrition by 2030, as one of a set of so-called Sustainable Development Goals (SDGs). The number of hungry began to rise in 2014, but this is the first time in more then a decade that the proportion of the global population going hungry has risen. About 489 million of the hungry are living in countries affected by conflict. “Over the past decade, conflicts have risen dramatically in number and become more complex and intractable in nature,” the heads of five U.N. agencies said in The State of Food Security and Nutrition in the World 2017 report. “This has set off alarm bells we cannot afford to ignore: we will not end hunger and all forms of malnutrition by 2030 unless we address all the factors that undermine food security and nutrition,” they said. Famine struck parts of South Sudan earlier this year, and there is a high risk that it could return there - and develop in other countries affected by conflict: northeast Nigeria, Somalia and Yemen, the agencies said.

11 percent of the world’s population is undernourished, says new U.N. report -- Global hunger is on the rise after a decade of continued decline, according to a new report.  The annual United Nations report on nutrition and food security says that increase is largely driven by conflict and climate-related events. Here’s a quick look at the findings:

  • An estimated 815 million people worldwide were undernourished in 2016. That’s 38 million more people than in 2015, and shakes out to 11 percent of the world’s population.
  • Malnutrition is harming children’s health. The report found that 155 million kids under age 5 are too short for their age, a sign of malnutrition known as stunting. More than 31 percent of kids in Africa suffer from stunted growth.
  • Another 52 million children don’t weigh enough for their height.The issue — another sign of malnutrition called wasting — is particularly prevalent in Southeast Asia, where more than 15 percent of kids experience wasting. Global rates of both stunting and wasting have fallen in the past decade.
  • Conflict and climate change are driving the crisis. More than half of those experiencing extreme hunger live in countries affected by conflict, such as South Sudan, Somalia, and Yemen. The authors of the new report say climate change increases the risk of natural disasters and threatens food security, which can drive a community toward conflict.
  • Other nutrition problems are on the rise. Obesity rates worldwide have more than doubled since 1980.
  • More women are breastfeeding exclusively. In 2016, 43 percent of infants under 6 months were exclusively breastfed, up from 36 percent in 2005.

High CO2 Makes Crops Less Nutritious - Crops grown in the high-CO2 atmosphere of the future could be significantly less nutritious, a new study published today in Nature suggests. Based on hundreds of experiments in the field, the work reveals a new challenge as society reckons with both rising carbon emissions and malnutrition in the future. Scientists generally predict that crop yields could fall in a warmer world—though higher atmospheric CO2 by itself should raise yields, as plants find it easier to extract CO2 from the air to make carbohydrates. The effect climate change might have on the nutritional value of crops, as opposed to their yield, has been even murkier. Previous studies have given conflicting results. In the largest study yet, Samuel Myers of Harvard University and colleagues report that the CO2 levels expected in the second half of this century will likely reduce the levels of zinc, iron, and protein in wheat, rice, peas, and soybeans. Some two billion people, the researchers note, live in countries where citizens receive more than 60 percent of their zinc or iron from these types of crops. Deficiencies of these nutrients already cause an estimated loss of 63 million life-years annually. Conducted over six growth years on field sites in Japan, Australia, and the United States, the study compared crops grown in normal conditions with ones grown in nearby experimental plots where the air is enriched with CO2 via open-air sprayers. The current atmospheric CO2 level is 400 parts per million; in the enriched plots, it was between 546 and 586 parts per million, a level scientists expect the atmosphere to reach in four to six decades.In addition to wheat, rice, peas, and soybeans, which all use a form of photosynthesis known as C3, Myers and his colleagues studied corn and sorghum, which use C4 photosynthesis, a faster kind. They found relatively little effect of CO2 enrichment on the nutritional value of the C4 crops. In the C3 crops, however, they found significant declines in zinc and iron. The largest was a 9.3 percent drop in the zinc level in wheat. They also found reduced levels of protein in wheat, rice, and peas, but not in soybeans.

Global warming reduces protein in key crops -- Rising carbon dioxide levels from global warming will drastically reduce the amount of protein in staple crops like rice and wheat, leaving vulnerable populations at risk of growth stunting and early death, experts warned on Wednesday.  Researchers say they still don't understand how or why carbon dioxide emissions sap protein and other nutrients from plants, but the mystery is one that could have devastating consequences across the globe. An additional 150 million people globally may be at risk of protein deficiency by 2050 because of rising levels of carbon dioxide in the atmosphere said the report in the journal Environmental Research Letters.The study, led by Harvard University researchers, is the first to quantify the impacts of global warming on the protein levels of crops. It relies on data from open field experiments in which plants were exposed to high concentrations of CO2.  Global dietary information from the United Nations was used to calculate the impact on people who live dangerously close to the edge when it comes to getting enough protein. Without it, growth is stunted, diseases are more common and early mortality is far more likely. A leading hypothesis was that CO2 might increase the amount of starch in plants, thereby decreasing protein and other nutrients. But lead author Samuel Myers, a senior research scientist in Harvard University's T. H. Chan School of Public Health, said that experiments did not back up the theory. "The short answer is we really have no idea," he told AFP.

Unprecedented levels of nitrogen could pose risks to Earth's environment -  Human production of this nitrogen is now five times higher than it was 60 years ago. This increase could pose as much of a danger to Earth's environment as the rapid increase in climate-warming atmospheric carbon dioxide, the scientists say. "Earth has never seen this much fixed nitrogen," says William H. Schlesinger, James B. Duke Emeritus Professor of Biogeochemistry at Duke's Nicholas School of the Environment. "It's a tremendous increase in the last half century, which is not what we were expecting to find,"  "While carbon has captured the attention of the world through climate change, we cannot ignore this issue," adds Viney Aneja, professor of marine, earth and atmospheric science at NC State. "Too much nitrogen can affect human health, reduce biodiversity and amplify global warming." Too much nitrogen in the soil benefits a limited number of species that can outcompete native species, reducing biodiversity, Aneja notes. High levels of nitrogen in groundwater are associated with intestinal cancers and miscarriages, and can be fatal to infants. Excess nitrogen compounds in waterways and lakes can cause toxic algal blooms, killing off aquatic species and threatening human health.    One form of nitrogen gas, nitrous oxide, is also a potent greenhouse gas and can contribute to global warming. High levels of nitrous oxide in the atmosphere also degrade the atmospheric ozone layer, and nitric oxide can create dangerous ground-level ozone.   Humans have used nitrogen compounds as a fertilizer for millennia, but historically only used naturally fixed sources, like manure and guano. ‘

Arkansas Plant Board Backs Dicamba Ban Next Summer in Blow to Monsanto -- The Arkansas Plant Board has approved new regulations that prohibit the use of dicamba from April 16 through Oct. 31, 2018 after receiving nearly 1,000 complaints of pesticide misuse in the state. Arkansas, which temporarily banned the the highly volatile weedkiller in July, could now face legal action from Monsanto , the developers of dicamba-resistant soybeans or cotton and the corresponding pesticide, aka the Xtend crop system. Reuters reports: "Monsanto previously submitted a petition asking the board to reject the proposed cutoff date for sprayings and warned the company may file a lawsuit if the board denied the request. If implemented, the deadline could hurt sales of dicamba herbicides and Monsanto seeds resistant to the chemical. The board unanimously denied Monsanto's petition and will work with legal staff to prepare a response, according to a statement. Monsanto developed its Xtend system to address " superweeds " that have grown resistant to glyphosate , the main ingredient in the company's former bread-and-butter, Roundup . It's not surprising that the company might file suit against Arkansas—Xtend crops are expected to expand across 80 million acres in the U.S., creating a $400-$800 million opportunity. What's happening in Arkansas is just a small slice of what's happening across the country's farm belt . Complaints of dicamba damage have surfaced in 24 states, impacting roughly 3 million acres.  "We are in unprecedented, uncharted territory," Andrew Thostenson, a pesticide program specialist with North Dakota State University Extension, told DTN . "We've never observed anything on this scale in this country since we've been using pesticides in the modern era."

Assumed safety of pesticide use is false, says top government scientist -- The assumption by regulators around the world that it is safe to use pesticides at industrial scales across landscapes is false, according to a chief scientific adviser to the UK government.The lack of any limit on the total amount of pesticides used and the virtual absence of monitoring of their effects in the environment means it can take years for the impacts to become apparent, say Prof Ian Boyd and his colleague Alice Milner in a new article. The damning assessment of pesticide regulations that are meant to protect the global environment follows a growing number of highly critical reports including research showing farmers could slash their pesticide use without losses and a UN report that denounced the “myth” that pesticides are necessary to feed the world.  “The current assumption underlying pesticide regulation – that chemicals that pass a battery of tests in the laboratory or in field trials are environmentally benign when they are used at industrial scales – is false,” state the scientists in their article published in the journal Science. Boyd is chief scientific adviser to the UK’s Department of Environment, Food and Rural Affairs, where Milner also works on secondment, but their criticism reflects their own views.“The effects of dosing whole landscapes with chemicals have been largely ignored by regulatory systems,” the scientists said. “This can and should be changed.” They contrast this situation with pharmaceuticals, for which there is a system of rigorous global monitoring after a drug is approved in case adverse effects emerge.

Heat and drought drive south India's farmers from fields to cities | Reuters: - Vinod Kumar grew up believing the farm would be his life. But today, the 30-year-old drives a car for a living in the city of Chennai, 250 km (155 miles) away. His family joined him two years ago, abandoning what had been for generations their home and their land. On a recent journey back to the area where he grew up, he said he was far from the only migrant. “At this time of year, these fields should be green with paddy shoots - but no one seems to be farming,” said Kumar, as he drove past arid fields overgrown with scrub and thorns one sweltering July afternoon. “We haven’t had enough water for many years. It has become impossible to make a living from farming, and a lot of people have moved to cities to do other jobs.” Tamil Nadu endured its worst drought in more than a century after the monsoon rains failed last year - and the combination of lack of water and worsening heat is driving a gathering wave of migration.In Nagapattinam, in the Cauvery river delta region of southeast India, drought and irregular rainfall have blighted lives for about a decade now. As ponds and tanks dry up, causing crops to fail and cattle to languish, more people - like Kumar - are moving to cities. The Asia-Pacific region, the most prone to natural disasters in the world and home to a fifth of the global population, is struggling with more frequent and intense disasters, from cyclones and droughts to floods and heatwaves. By the turn of the century, much of South Asia could be too hot for people to survive, according to researchers at the Massachusetts Institute of Technology. 

Whole Foods “Free-Range” Chicken Supplier Said To Actually Run Factory Farm – David Dayen - When Amazon purchased Whole Foods last month, it didn’t just get the retail locations. It picked up Whole Foods’s baggage as well. Among the bigger issues inherited by Amazon appears to be a four-month investigation from the animal rights group Direct Action Everywhere that challenges Whole Foods’s core selling point of healthy and humane food.The group accused Pitman Family Farms, the maker of Mary’s Free Range Chicken and a supplier to Whole Foods in six Western states, of breaking its promises of free-range environments for its birds.Direct Action Everywhere, whose mission is to create animal welfare-friendly cities and outlaw factory farming practices, visited a dozen Pitman farms and never once saw a chicken roaming outside. The group reported that it found no indications of outdoor living, such as feathers or fecal matter. Twenty-four hour surveillance cameras attached to six separate locations revealed no outdoor birds either, the activists said. Instead, chickens were packed shoulder-to-shoulder inside dusty sheds with degraded air quality, forced to challenge one another for access to food and water. Video of Direct Action Everywhere’s findings showed scattered fighting among the chickens and smaller birds with injuries, including one with its eye pecked out. They also alleged evidence of “debeaking,” a procedure involving severing the tip of a chicken’s beak with a laser to prevent pecking.

Antibiotic resistance in fish farms is passed on from fish food | The Economist -- THE mucky sediment below fish farms usually teems with antibiotic-resistant bacteria. The presence of such bacteria is a cause of increasing concern because resistance can limit the ability to fight diseases, but it is also not that surprising: pisciculturalists have a long history of dosing fish they are breeding and rearing with antibiotics. But some scientists suspect there is more to it than that. One group, led by Jing Wang of Dalian University of Technology in China, has found that the problem is also linked to what the fish are being fed. Dr Wang knew from previous reports that fish farmers who had not used antibiotics for years, or had never used them at all, still had sediment in their marine farms carrying bacteria with many of the genes associated with drug resistance. The genes had to be getting into the bacteria somehow; one possible pathway was through antibiotic-resistance genes in fish food mingling in various ways with bacteria in the sediment. Working with a team of colleagues, Dr Wang set up an experiment to find out if that was the case. As they report in Environmental Science and Technology, the researchers obtained five commonly used fishmeal products and subjected each one to a detailed genetic analysis.The results were clear. Although the control microcosms started with some resistance genes present (as there is bound to be in nature) the number did not increase. In contrast, the number of resistance genes present in the microcosms exposed to the Peruvian fishmeal increased tenfold. The discovery of fish food as a source of resistance genes migrating into oceanic bacteria is worrying, and the researchers say more work is needed to determine if these resistance traits can find their way into the human food chain.

How different are wild salmon from farm salmon? A lot, DNA shows. -- Within just one generation, hatchery-born salmon can become drastically different from their counterparts in the wild, with hundreds of variations at the genetic level. Looking specifically at the steelhead trout salmon, researchers at Oregon State University, in collaboration with the Oregon Department of Fisheries and Wildlife, found more than 700 genetic variations between farm-raised and wild salmon. The differences have long been theorized to exist. The survival and reproduction gaps between the two fish point to the rapid adaptation of hatchery fish to their confined environments. When fish born in hatcheries are released to the wild, for instance, they have a far harder time reproducing than compared to their indigenous cousins. “We observed that a large number of genes were involved in pathways related to wound healing, immunity, and metabolism, and this is consistent with the idea that the earliest stages of domestication may involve adapting to highly crowded conditions,” Mark Christie, lead author of the study, said in a statement. But now with DNA evidence in the study published Wednesday in Nature Communications, the case is closed. After comparing the offspring of first-generation salmon raised in a hatchery with those in the wild, the scientists counted 736 genetic differences. “This pretty much settles the question of whether hatchery fish can be genetically different after just a single generation of domestication,” Michael Blouin, an author of the study, told Newsweek. “What is important is that this work is a step towards trying to figure out which traits are under strong selection in the hatchery, and what hatchery conditions exacerbate that selection.”

North American Ash Tree, Madagascan Grasshopper On Brink Of Extinction - Ash trees are some of North America's most prominent and valuable tree species. They are essential to the plant communities in the United States; are a key part of American forests; and provide habitat for many birds, squirrels, insects, and pollinating species such as butterflies. Unfortunately, the latest update on the IUCN's Red List shows that five out of the six most prominent ash tree species in North America are already Critically Endangered. In fact, they are already said to be on the verge of extinction. Three of which, the black, green, and white ash, are the most dominant ash tree species. If white ash sounds familiar, it is because it is a popular and valuable timber in North America used to make baseball bats, hockey sticks, and furniture. The culprit behind the dwindling ash tree population is the prevalence of the Emerald ash borer beetle species which bore and feed on ash trees. The beetle species was introduced in Michigan in the late 1990s via infected pallets from northeast China and was discovered as the reason for the 2002 ash tree mortality in Michigan and Ontario. The invasive species has since continued to spread throughout North America because of warming temperatures in the region despite efforts to thwart the population. Almost 40 percent of Madagascan pygmy grasshopper species are already threatened, seven of which are already Critically Endangered including the Rumplestiltskin Pygmy grasshopper. Similarly, more than 40 percent of Madagascan millipedes are also facing the threat of extinction, with 27 of the 145 endemic species already in the Critically Endangered category. In both cases, the main causes of the population decline are deforestation and mining projects in the region. Five African antelope species which were previously under the Least Concern category are now of concern as their populations continue to dwindle. The Giant Eland, the world's largest antelope species, has moved from Least Concern to Vulnerable, while the Southern Lechwe and Grey Rhebok have become Near Threatened. The Heuglin's Gazelle and the Mountain Reedbuck are also now species of concern as they are now on the "Endangered" category. Main reasons for the population decline among antelopes are poaching, habitat loss as human populations continue to grow, and disturbances due to being in competition with livestock and cattle herders. Increased frequency and periods of drought due to climate change are also contributing factors to the decline.

Huge sea turtles slowly coming back from brink of extinction (AP) — Sea turtles are lumbering back from the brink of extinction, a new study says.Scientists found more populations of the large turtles improving than declining when they looked at nearly 60 regions across the globe. That's a big change from a decade or two ago, experts said.Long-living sea turtles have been pushed to endangered levels by hunting, accidentally being caught in fishing nets, habitat loss, plastics pollution and climate change, experts say.But massive efforts to save the egg-laying turtles by changing fishing nets and creating protected and darkened beaches are working, said study lead author Antonios Mazaris, an ecology professor at Aristotle University of Thessaloniki in Greece."There's a positive sign at the end of the story," Mazaris said. "We should be more optimistic about our efforts in society."The research was published Wednesday in the journal Science Advances. There are seven different species of sea turtles, all but one endangered. The slow creatures live for several decades with some species weighing about 100 pounds and others well over 1,000 pounds.

Half of Canada's monitored wildlife is in decline, major study finds -  A new analysis looking at the long-term trends of more than 900 species of wildlife in Canada has found that half of them have seen their populations decline, including several species already listed as threatened or endangered. The Living Planet Report Canada, released on Thursday by World Wildlife Fund Canada, paints a bleak picture for wildlife in a country that is home to a quarter of the earth’s wetlands, 8,500 rivers and more than 2m freshwater lakes. During the past four decades, human activity – whether industrial development, farming, forestry or the expansion of urban areas – as well as climate change, pollution and overfishing have helped shrink the populations of 451 species, representing half of the 903 monitored species in the country. “I think for many Canadians, it’s somewhat of a surprise,” said James Snider of WWF Canada and the lead author of the report. “Canada is this vast nation with huge wilderness areas, at times we assume that wildlife here is doing OK.” The list of species in decline ranges from the woodland caribou, who grace the country’s 25¢ coin but have seen their habitat shrink from logging, mining and gas development, to the several species of whale that live off Canada’s three coasts. The report found that for species with diminishing populations, the average loss was 83% of their population. “That’s a really striking number,” said Snider. The report – billed by the conservation group as the most comprehensive synthesis of Canadian wildlife population trends to date – was compiled using more than 400 sources of data on species population. 

Fierce debate roars to life over grizzly bear hunt - There’s no shortage of controversy surrounding the British Columbia government’s decision to stop the grizzly bear trophy hunt.The province announced in late August that it’s moving towards permanently closing grizzly trophy hunting by the end of November, with immediate closure in the Great Bear Rainforest. Hunting grizzlies for their meat is still permitted. Supporters of trophy hunting view the ban as a political decision that ignores scientific information, diminishes economic opportunities and tarnishes hunters’ reputations. Opponents applaud the ban, arguing the hunt is outdated, lacks concrete evidence to support its existence and is barbaric. Certainly the ban could signal changes for future grizzly bear management across other jurisdictions. Outfitters in the Yukon have already raised concerns, calling for more scientific studies to inform bear management decisions. Alberta may also face increased scrutiny and pressure to reconsider a grizzly hunt in light of research on bear populations and public tolerance for conflict. There’s also controversy about hunting grizzlies in the United States, with Yellowstone’s recent decision to remove the bears from their endangered status list and the move to stop protecting bears on Alaskan reserves. So what to make of these arguments for and against trophy hunting grizzlies? Is trophy hunting a legitimate management tool? And is it even ethical to control the grizzly population that way?

To save the planet, scientists figured out how to fix cow farts - Raising cattle contributes to global warming in a big way. The animals expel large amounts of methane when they burp and fart, a greenhouse gas many times more potent than carbon dioxide. U.S. beef production, in fact, roughly equals the annual emissions of 24 million cars, according to the Union of Concerned Scientists. Still, most people probably wouldn’t be inclined to swap their juicy steak for a bowl of beans. Researchers think there may be a better way. Rather than ask people to give up beef, they are trying to design more climate-friendly cattle. The goal is to breed animals with digestive systems that can create less methane. One approach is to tinker with the microbes that live in the rumen, the main organ in the animals’ digestive tract. These tiny organisms enable fermentation during digestion and produce the methane released by the cattle.  Scientists in the United Kingdom last year found that a cow’s genes influence the makeup of these microbial communities, which include bacteria and alsoArchaea, the primary producers of methane. This discovery means cattle farmers potentially could selectively breed animals that end up with a lower ratio of Archaea-to-bacteria, thus leading to less methane.“The methanogens — or Archaea, which produce methane — are totally different from bacteria, so we could determine their abundances in the rumen samples,” said Rainer Roehe, professor of animal genetics at Scotland’s Rural College. Roehe studied the composition of microbes in sample animals and established that the host animals’ genes were responsible for their makeup. “The higher the Archaea-to-bacteria ratio, the larger the amount of methane emissions,” he said. His study, which appeared in PLOS Genetics, recently won the journal’s prestigious genetics research prize. The journal called the work “the first step toward breeding low-emission cattle, which will become increasingly important in the face of growing global demand for meat.” The research identified specific microbial “profiles,” that is, combinations of microbes, which could help determine which cattle digest their feed more efficiently, and emit less methane.  “These can then be used as selection criteria to mitigate methane emissions,” Roehe said. “The selection to reduce methane emissions would be permanent, cumulative and sustainable over generations as with any other trait, such as growth rate, milk yield, etc. used in animal breeding.” This, over time, “would have a substantial impact on methane emissions from livestock,” Roehe said.

Researchers find summer heat’s lasting longer in the Gulf of Maine - New scientific research has revealed that summer temperatures in the Gulf of Maine, the second fastest warming part of the world’s oceans, are persisting two months longer than they were as recently as the early 1980s.The findings, by a Maine-led team of scientists, have ramifications for marine life, fishermen and the strength of hurricanes, which appear in late summer and are fueled by warm water. “What we found was quite astonishing in that almost all the warming is in the late summer and the winter is not contributing very much at all,” says the project’s lead scientist, University of Maine oceanographer Andrew Thomas. “You can think of impacts all across the food chain, from animals that have actual temperature tolerances to the distribution of species, their prey, and even their predators, not to mention the bacteria and viruses, which we have no idea how they will react.”The researchers used daily satellite readings collected between 1982 and 2014 to map changes in sea surface temperatures along the Eastern Seaboard from North Carolina to Nova Scotia, breaking out the data by month to reveal seasonal differences in warming rates. They weren’t surprised to find the strongest warming in the Gulf of Maine and adjacent Scotia Shelf – team members had worked with Andrew Pershing of the Gulf of Maine Research Institute in Portland to demonstrate this in a 2015 study – but the profound seasonal differences were unexpected. The satellite data show warming trends across the Gulf of Maine for every month and very sharp increases during July, August and September, especially off the Maine coast. While the Gulf of Maine warmed by an average of 0.72 degrees Fahrenheit per decade during the 33-year period, the warming rate was twice that in the months of July through September, or 1.44 degrees F per decade.

What's The Effect Of So Many Wildfires On Global Warming?  - A team of atmospheric scientists from the University of Wyoming are busy unloading from a recent trip to Montana to study the fires where all this smoke originated. For weeks, skies across the west have been filled with this billowing white smoke. “Some people are only able to go out with one of these type of instruments and make a measurement. And so we’re really fortunate that we have this amazing suite of instruments with which we can kind of build a more complete picture.” A picture of two different kinds of emissions: black and brown carbon. Everybody knows black carbon. It’s soot that spews from cars and power plants. Its dark color is known to be the third largest cause of atmospheric warming after carbon dioxide and methane. Brown carbon, though, is light colored. Think of it as white smoke, like when you burn wet wood in a campfire. It’s not as efficiently burned up as soot. “Right now, climate models don’t really include brown carbon,” says UW atmospheric science professor Shane Murphy. “Right now there’s a lot of uncertainty on how important it is, how long does it last, does it evaporate, does it get aged out as the smoke goes downwind? So we’re trying to figure those things out.” Right, this minute, 137 fires are burning around the country, a huge number this late in September. And it’s puffing a lot of brown carbon up into the atmosphere. Murphy says the common theory is that fires have zero warming effect on the climate because it’s light in color and reflects light, unlike black carbon that absorbs light, warming things up. “If it turns out forest fires are quite cooling, right now you might think that’s good. But in some ways that’s not good because it means they’re masking some other warming from human sources,” Murphy says. “And so if we cut down on forest fires, we might actually see more warming.” But Murphy says, the idea that brown carbon cools has never been proven scientifically. And that’s why scientists around the west including those at UW are joining forces to solve the mystery of brown carbon’s role in climate change, once and for all. Over the next few months, these guys will be very busy digesting all the data they’ve collected about white smoke during this very volatile wildfire season. 

August 2017 was second warmest on record – NASA - August 2017 was the second warmest August in 137 years of modern record-keeping, according to a monthly analysis of global temperatures by scientists at NASA's Goddard Institute for Space Studies (GISS) in New York. The measured value is consistent with the trend in global average surface temperatures that has been observed during the past few decades. Last month was +0.85 degrees Celsius warmer than the mean August temperature from 1951-1980. It was surpassed by August 2016, which was still affected by the 2015-2016 El Niño and was 0.99 degrees Celsius warmer than normal. However, August 2017 was about +0.2 degrees warmer than the August following the last large El Niño event in 1997-1998. The monthly analysis by the GISS team is assembled from publicly available data acquired by about 6,300 meteorological stations around the world, ship- and buoy-based instruments measuring sea surface temperature, and Antarctic research stations.

Earth Has its Third Warmest August on Record in 2017 - August 2017 was the planet's third warmest August since record keeping began in 1880, said NOAA's National Centers for Environmental Information (NCEI) on Monday. NASA rated August 2017 as the second warmest August on record. The only warmer Augusts, according to NOAA, came during 2016 and 2015, when a strong El Niño was helping increase global temperatures. Minor differences can occur between the NASA and NOAA rankings because of their different techniques for analyzing data-sparse regions such as the Arctic. Global ocean temperatures last month were the fourth warmest on record for any August, according to NOAA, and global land temperatures were the second warmest on record. Global satellite-measured temperatures for the lowest 8 km of the atmosphere were the third or second warmest for any August in the 39-year record, according to the University of Alabama Huntsville (UAH) and Remote Sensing Systems (RSS), respectively.  Each of the first eight months of 2017 have ranked among the top three warmest such months on record, giving 2017 the second highest January–August temperature in the 138-year record: 0.88°C (1.58°F) above the 20th century average. This is behind the record year of 2016 by 0.13°C (0.24°F). This near-record warmth is especially remarkable given the lack of an El Niño event this year. Global temperatures tend to be warmer during El Niño years, when the ocean releases more heat to the atmosphere. Given the lack of an El Niño event in 2017, it is unlikely that we will surpass 2016 as the warmest year on record. However, 2017 is almost certain to be the planet's warmest year on record that lacks any influence from El Niño, and Earth's four warmest years of the last century-plus are likely to be 2016, 2017, 2015, and 2014.

La Niña May Develop By Fall or Winter, NOAA Says; Here's What That Could Mean -- La Niña is now increasingly possible in the next few months, according to a new report released by NOAA, and may have some impacts on weather in the United States in the fall and winter. La Niña/El Niño, the periodic cooling/warming of the equatorial eastern and central Pacific Ocean, can shift weather patterns over a period of months, bringing the possibility of more sustained warm, cold, wet or dry weather in parts of the world. Since mid-August, slightly cooler-than-average surface temperatures were in place across the equatorial eastern and central Pacific Ocean. NOAA also noted water below the surface in this zone had also trended colder than average. Sea-surface temperature anomalies in the equatorial central and eastern Pacific Ocean on September 14, 2017. The general area which is monitored for La Niña or El Niño is highlighted by the rectangle. We've said many times an El Niño, La Niña or the lack of either, known as the neutral phase, is only one large-scale forcing on the atmosphere. It is not the be-all and end-all determining whether a season is wet, dry, cold or warm. Despite that, the peak atmospheric response to the equatorial Pacific anomalies tends to occur in the Northern Hemisphere's winter months. During last winter's weak La Niña, the West and Upper Midwest had one of their wettest winters on record, while a large swath of the East, South and Midwest had one of their warmest winters. If we have a La Niña settle in by fall or winter, let's take a look at December-through-February U.S. temperature and precipitation anomalies during weak (SST anomalies from 0.5 to 0.9 degrees below average), moderate (1.0 to 1.4 degrees below average) and strong (1.5 degrees below average or cooler) La Niñas prior to last winter's event. While there are some differences among La Niña magnitudes, some commonalities emerge regarding La Niña winter forcing in the U.S.:

  • Cold: Northern Plains, Upper Midwest, New England, New York state, West Coast
  • Warm: Southern Plains, Southeast

Scientists Say Italian Supervolcano Is "Becoming More Dangerous" As Magma Builds Beneath It --- After the long-dormant supervolcano Campi Flegrei awakened late last year, a team of scientists that has pinpointed the now-active volcano's magma source says a potentially devastating eruption could be just around the corner.Campi Flegrei is a volcanic caldera to the west of Naples that last erupted in the sixteenth century. It has been mostly quiet since then, with the exception of a few small tremors in the 1980s. Seismographic data from those rumbles allowed scientists to pinpoint the source of the magma that flooded into Campi Flegrei's chamber and caldera, according to United Press International. The results are unequivocal: An analysis of the supervolcano's hot zone suggests Campi Flegrei could be nearing an eruption."What this means in terms of the scale of any future eruption we cannot say, but there is no doubt that the volcano is becoming more dangerous," De Siena said."The big question we have to answer now is if it is a big layer of magma that is rising to the surface, or something less worrying which could find its way to the surface out at sea."Researchers liken the volcano's hot zone to a boiling pot of soup. Over the last several years, the volcano has gotten considerably hotter. Four years ago, scientists warned any eruption could kill millions living near or on top of the volcano. Now, based on an assessment of the current flows, scientists are worried that a potentially deadly eruption could happen close to a population center like the city of Naples.

The Morning After: Mexican Earthquake Leaves Over 248 Dead, Millions Without Electricity - Across central Mexico, rescue workers including soldiers and volunteers worked late into the night Tuesday to free the living who were still trapped in the rubble of collapsed buildings following Mexico's deadliest earthquake in more than 30 years. The death toll from the 7.1 magnitude quake – which bizarrely occurred on the anniversary of a 1985 quake that left 5,000 dead – has climbed to 248, with more than half of those deaths occurring in the Mexican capital city.  It also comes two weeks after another powerful quake left nearly 100 dead in Mexico City. The quake was unusually close to Mexico City, located just 60 miles south of the capital in Chiautla de Tapia, a small town in neighboring Puebla state, according to Mexico’s seismological service. More are feared dead, including possibly dozens of teachers and schoolchildren feared buried in the rubble of a Mexico City school, one of hundreds of buildings that was destroyed by the quake, according to Reuters.  Additionally, several buildings collapsed in the chic neighborhoods of Roma and Condesa in central Mexico City, where many foreigners live. In Condesa, rescue workers scrambled to find eight to 10 people believed trapped under the debris of a building that collapsed near Mexico Park, one of the city’s most famous parks. Hundreds of volunteers formed a human chain to help clear rubble and bring food and water to rescue workers. Mexico was also hit earlier this month by Hurricane Katia, which killed two. Even the Popocatépetl volcano southeast of the city sent a large cloud of ash into the sky on Tuesday. “This is too much. It’s like we’re cursed or something,” said Marcos Santamaría, a 62-year-old retiree. Philippines and the United Nations have offered to support the recovery effort. At least 30 second-grade students are still missing, along with eight adults

Deadly Mexico City Earthquake Triggered Volcanic Eruption -- A deadly M 7.1 earthquake struck nearby Mexico City yesterday, leaving over 200 dead and countless missing. The US Geological Survey predicts up to 1,000 fatalities in total and an economic impact of $1 to $10 billion as a result of the earthquake. The earthquake occurred southwest of Puebla and southeast of Mexico City at a depth of 51 kilometers. Emergency crews have been combing Mexico City in search of trapped survivors after buildings were diminished to rubble. The death toll is currently 217, which will likely grow as rescue workers excavate more rubble. In addition, dozens of buildings have been demolished, pipelines broken, and roads left impassable.The M 7.1 earthquake is currently the deadliest since 1985 and is the latest in astring of earthquakes to hit Mexico in the recent months. A magnitude 8.1 earthquake struck southern Mexico just earlier this month, the strongest earthquake to hit Mexico in over a century. It is likely not a coincidence that on the same day as the massive earthquake Popocatépetl volcano also erupted. The volcanic eruption likely was triggered by shaking caused by the earthquake.  The topic is still debated among scientists, but there is enough evidence that earthquakes can and do trigger volcanic eruptions. In 1960, the volcano Cordon Caulle in the Andes began erupting just 2 days after a M 9.6 earthquake struck Chile. In between eruptions, volcanoes fill their magma chambers with magma as they "prepare" for the next eruption. The exact timing of an eruption is hard to predict as one must accurately determine the timing at which the overlying pressure of the volcano equals the underlying pressure exerted by a filled magma chamber. If a volcano is close to erupting, an earthquake could shake the volcano enough to create fractures or conduits through which the magma can begin erupting. This is why we've seen several times major earthquakes in volcanic regions trigger volcanic eruptions.

32 Children Dead, 30 More Missing In Rubble Of Collapsed Mexico City School -- More than 30 students have been confirmed dead, and 30 more are missing, as rescuers sift through the rubble of the Enrique Rebsamen primary and secondary school, a private school that was one of 44 buildings in Mexico City that collapsed during Tuesday's historic earthquake. According to the Associated Press, a wing of the three-story school pancaked into a pile of concrete slabs during the quake, killing dozens and leaving dozens more trapped in the wreckage. Soldiers and volunteers toiled through the night to try and free the trapped schoolchildren and staff. At least and five teachers, and 32 students, have been confirmed dead. The 7.1 magnitude quake shook Central Mexico, leaving at least 250 people dead in the deadliest earthquake since a 1985 quake that left 5,000 dead. Bizarrely, Tuesday's quake occurred on the 32nd anniversary of the 1985 quake. Two children were rescued from the rubble, but 30 more people are still missing, local media reported. The hundreds of soldiers and volunteer rescue workers who were frantically digging through the debris said they could hear noises in the rubble, but have been unable to discern whether sounds emanating from the ruined wing were survivors pounding for help, or simply the noises of shifting wreckage, according to NBC. Working through the night, the AP described how workers would ask for silence occasionally to listen for signs of life amid the wreckage.

Why the Mexico City Earthquake Shook Up Disaster Predictions - Mexico City is badly rattled. On Tuesday—32 years to the day after a giant earthquake killed as many as 10,000 people in this very place—seismologists and city dwellers got another major shock. A rupture in a fault that had not worried building planners or seismologists caused heavy damage throughout the city and took the lives of more than 200 people. The implications of this new quake may shake the foundations of how people prepare for temblors not just in Mexico but also throughout the world. The first thing to understand about Tuesday’s quake is that Mexico City was built on a lakebed, which makes quakes’ effects quite extreme. The area’s original inhabitants, the Mexica, built their capital on an island in the middle of sprawling Lake Texcoco, attached to the shore by a network of dikes and bridges. Over the next 300 years the Spanish and then Mexican governments filled in the lake, turning the island into a sprawling metropolis of some 25 million people. Nowhere else in the world do you have landfill on this scale in dangerous proximity to a fault zone. The basin of the city has been compared with a bowl of JELL-O, which jiggles enough to topple buildings even after the quake that triggered it has all but petered out. But the jiggling has a pattern: In 1985 in the city’s affluent Roma and La Condesa districts, buildings between eight and 13 stories tall were hit especially hard. It turns out the deep columns of mud under Roma and Condesa shake at a frequency that resonates perfectly with buildings of that height. “It vibrates like a bell. It rings at only one tone,” says Diego Melgar, a seismologist at the University of Oregon who was raised in Mexico City. “That frequency was close to the natural frequency of these eight- to 13-story buildings. And that’s what led to most of the collapses.” So Mexico City began preparing for the next big one. Building regulations were aimed at securing buildings of specific sizes. And seismologists began looking at the potential source of a new large earthquake, a section of a fault near the coast called the Guerrero Gap. But Tuesday’s earthquake did not happen at the Gap or even on the coast at all. Instead, the earth broke in the interior mountains, 35 miles below the surface, not far from where a large plate of crust has sunk deep down into molten rock. Allen Husker, also a seismologist at U.N.A.M., thinks his colleagues may have been looking for threats in the wrong place. “We have a bit of a controversy about whether or not the Guerrero Gap is the earthquake that we are all waiting for,” he says.

GOP rep on paying for flood loss: ‘At some point, God is telling you to move’ - Rep. Jeb Hensarling (R-Texas) said on Thursday that it's unreasonable for taxpayers to repeatedly pay for homes that have flooded, suggesting that homeowners move out of at-risk houses. "We have these repetitive loss properties. So, for example, we have one property outside of Baton Rouge that has a modest home worth about $60,000 that's flooded over 40 times. The taxpayers have paid almost half a million dollars for it," Hensarling said on CNBC's "Squawk Box." "At some point, God is telling you to move," he added. “If all we do is force federal taxpayers to build the same home in the same fashion in the same location and expect a different result, we all know that is the classic definition of insanity," he continued. Hensarling's comments come as his home state of Texas recovers from catastrophic flooding that occurred last month in the wake of Hurricane Harvey. The storm, which made landfall on Texas's southeast coast as a Category 4 hurricane, dumped rain across the region, including 50 inches in the Houston area. The storm is estimated to have left 30 percent of the largely-populated Harris County, which is home to Houston, underwater. Republican Texas Gov. Greg Abbott said damages from the storm could cost $180 billion. President Trump signed legislation that would provide $15 billion in disaster relief for areas affected by Harvey.

Harvey Swept Hazardous Mercury Ashore. The Mystery: Its Source --As Harvey’s flooding receded and property owners went in search of their lost belongings, some of them found more than they were prepared for. The floodwaters brought in globules of silvery-white substance, which turned out to be clusters of mercury, a metal that stays liquid at room temperatures and represents a health hazard to humans and animals. Defined in the periodic table as metals with high atomic weights, heavy metals have pathologic effects on human and animal nervous systems, in part because they disrupt the normal functions of essential proteins. In the past some mercury compounds were used in industrial fungicides, and today they are found in soil, water, fish, and other parts of the food chains. In the body, mercury easily enters various tissues and crosses the brain-blood membrane, as well as the placenta barrier in pregnant women, inhibiting the division and growth of neuronal cells, and causing developmental effects, including cerebral palsy. It’s not clear where the unexpected mercury deluge came from, but experts believe it came either from one the Texas Superfund sites or from an industrial container broken by the storm.

Residents Cough, Rub Eyes in Harvey Pollution Spike - After Harvey swept through industrial areas of Houston, flooding several highly contaminated Superfund sites that are waiting for the federal government’s clean up, local residents began to fall ill with severe headaches, nausea, and itchy skin and throats—the typical symptoms of industrial chemical exposure. In preparation for Harvey, oil refineries and chemical plants had to burn off compounds that could combust in extreme weather or power loss (as indeed happened at the Arkema chemical plant), releasing an unusually high number of pollutants. For the residents of the lower middle-income neighborhoods located around the industrial area, this came as a double blow: many don’t have health insurance to seek help, and yet are afraid to speak up because their family members work at the very plants that made them sick. Although past research investigated whether chemical companies adhere to lower standards in poorer areas, and found correlations between higher levels of emissions from refineries and lower levels of income, employment and population density, no clear causative link was established. But regardless of the socioeconomic status, as the extreme weather events are likely to intensify in the future, humans will have to devise better preventative measures and policies. The consequences of Katrina resulted in a number of regulatory processes and waivers, aimed at both sides of the problem—cleaning up the pollutants escaped from the oil plants and assuring that the impacted refineries could resume functioning to avoid fuel shortages. The aftermath of Harvey and Irma will also require a long-term cleanup, likely demanding more regulatory changes as well.

Evidence of spills at toxic site during floods  — The U.S. government received reports of three spills at one of Houston’s dirtiest Superfund toxic waste sites in the days after the drenching rains from Hurricane Harvey finally stopped. Aerial photos reviewed by The Associated Press show dark-colored water surrounding the site as the floods receded, flowing through Vince Bayou and into the city’s ship channel. The reported spills, which have been not publicly detailed, occurred at U.S. Oil Recovery, a former petroleum industry waste processing plant contaminated with a dangerous brew of cancer-causing chemicals. On Aug. 29, the day Harvey’s remnants cleared out, a county pollution control team sent photos to the Environmental Protection Agency of three large concrete tanks flooded with water. That led PRP Group, the company overseeing the ongoing cleanup, to call a federal emergency hotline to report a spill affecting nearby Vince Bayou. Over the next several days, the company reported two more spills of potentially contaminated storm water from U.S. Oil Recovery, according to reports and call logs obtained by the AP from the U.S. Coast Guard, which operates the National Response Center hotline. The EPA requires that spills of oil or hazardous substances in quantities that may be harmful to public health or the environment be immediately reported to the 24-hour hotline when public waterways are threatened. The EPA has not publicly acknowledged the three spills that PRP Group reported to the Coast Guard. The agency said an on-scene coordinator was at the site last Wednesday and found no evidence that material had washed off the site. The EPA says it is still assessing the scene. The AP reported in the days after Harvey that at least seven Superfund sites in and around Houston were underwater during the record-shattering storm. Journalists surveyed the sites by boat, vehicle and on foot. U.S. Oil Recovery was not one of the sites visited by AP. EPA said at the time that its personnel had been unable to reach the sites, though they surveyed the locations using aerial photos. 

One of Houston's dirtiest Superfund sites is suffering from multiple toxic-waste spills — and the government has yet to acknowledge it — The US government received reports of three spills at one of Houston's dirtiest Superfund toxic-waste sites in the days after the drenching rains from Hurricane Harvey finally stopped. Aerial photos reviewed by the Associated Press show dark-colored water surrounding the site as the floods receded, flowing through Vince Bayou and into the city's ship channel. The reported spills, which have been not publicly detailed, occurred at US Oil Recovery, a former petroleum-industry waste-processing plant contaminated with a dangerous brew of cancer-causing chemicals. On August 29, the day Harvey's remnants cleared out, a county pollution-control team sent photos to the Environmental Protection Agency of three large concrete tanks flooded with water. That led PRP Group, the company overseeing the ongoing cleanup, to call a federal emergency hotline to report a spill affecting nearby Vince Bayou. Over the next several days, the company reported two more spills of potentially contaminated storm water from US Oil Recovery, according to reports and call logs obtained by the AP from the US Coast Guard, which operates the National Response Center hotline. The EPA requires that spills of oil or hazardous substances in quantities that may be harmful to public health or the environment be immediately reported to the 24-hour hotline when public waterways are threatened.  The EPA has not publicly acknowledged the three spills that PRP Group reported to the Coast Guard. The agency said an on-scene coordinator was at the site last Wednesday and found no evidence that material had washed off the site. The EPA says it is still assessing the scene.

Sewage spills add to misery in hurricane-battered Florida - Local governments have submitted well over 100 “notices of pollution” to the state Department of Environmental Protection since Hurricane Irma struck, some involving multiple spills and releases of millions of gallons of wastewater in various stages of treatment. Officials in many cities were still scrambling Thursday to determine how much sewage had escaped, while the state warned people to steer clear of standing water.“Floodwaters may contain not only bacteria from sanitary sewer overflows but other potential contaminants from agricultural or industrial waste,” environmental protection department spokeswoman Dee Ann Miller said. About 6 million gallons of wastewater was released from a plant on Virginia Key near Miami during a seven-hour power outage overnight Sunday that disabled its pumps — one of seven spills reported by the Miami-Dade County Water and Sewer Department. The water had gone through most of the treatment process but hadn’t been chlorinated, spokeswoman Jennifer Messemer-Skold said. Officials advised people not to swim at Miami-area beaches until waters could be tested for a variety of pollutants. The U.S. Environmental Protection Agency deployed teams to help state officials assess damage to wastewater and drinking water systems.  Wastewater treatment is challenging enough in a state with flat, low-lying terrain and a booming population concentrated largely in coastal cities. Pipes and other infrastructure are aging, a common problem across the U.S., and many residents use private septic tanks that are susceptible to flooding. A consultant’s report commissioned by the state found that leaks and overflows resulting from hurricanes Hermine and Matthew in 2016 totaled about 250 million gallons. Electricity interruptions during heavy storms often deliver the knockout punch to already vulnerable systems. They shut down “lift stations” pumping wastewater from lower to higher elevations on its way to treatment plants, causing backups that can propel untreated sewage into homes or through manhole covers onto city streets. Some lift stations are equipped with emergency generators, while others are idled unless officials can get portable generators to them.

Hurricane Irma cut power to nearly two-thirds of Florida's electricity customers – EIA – (interactive graphic by county) Hurricane Irma struck Florida on September 10, 2017, and knocked out power to 6.7 million electricity customers—64% of all customer accounts in the state—according to reports compiled by the Florida Division of Emergency Management. About 100,000 customers (1% of the state total) remained without power as of September 19. The count of customers reflects the number of billed accounts or individual meters. The number of people affected by power outages is larger than the customers affected because more than one person may be covered by a single electric bill. Hurricane Irma also knocked out power to at least 1.3 million customers in Georgia and close to half a million customers in other states, but nearly all hurricane-related outages in states other than Florida have since been resolved.  Hurricane Irma followed the western coast of Florida after first making landfall in the continental United States in the Florida Keys. Irma was the first major hurricane to hit Florida since Hurricane Wilma in 2005. Wilma was a Category 3 hurricane with similar intensity to Irma when it made landfall in the United States at almost exactly the point of Irma’s second landfall near Marco Island. Power outages in Florida rose slowly on September 10, but they increased rapidly overnight as Hurricane Irma traveled up the state. About 15% of customers were without power at noon on September 10, and power outages peaked at 3:00 p.m. on September 11, affecting 64% of customers. In contrast, Hurricane Wilma moved quickly across the southern part of the state, knocking out power to 36% of customers in Florida.  Although the percentage of Florida customers without power during Irma was significantly higher than during Wilma, the rate of electric service restoration has been more rapid. Five days after Irma’s landfall, the share of customers without power had fallen from a peak of 64% down to 18% (a recovery rate of about 9% of customers per day). Power outages during Wilma declined from 36% of customers to 16% by the fifth day after landfall (an average recovery rate of about 4% of customers per day). Based on information in the U.S. Department of Energy’s situation reports, nearly 60,000 power company employees from the United States and Canada were involved in restoration efforts after Hurricane Irma.

Hours After Hurricane Irma, Miami-Dade County Tickets Residents For Code Violations -- Mere hours after Hurricane Irma, Miami-Dade County was ticketing residents for building code violations on their wrecked properties. Celso Perez was helping his neighbors remove some fallen trees blocking their street when a county code enforcer rolled up and issued him a safety notice for having a downed fence. "I laughed," Perez tells WSVN-TV. "I thought he was kidding. 'You are kidding right? We just had a hurricane six hours ago.'" It wasn't a joke. The official told Perez that the downed fence—which encloses a pool—was a safety hazard, and that if it wasn't fixed by the time he returned, Perez would be hit with a fine. The official then hung the safety citation on the portion of Perez's fence that remained standing, leaving him and his neighbors to finish clearing the debris from their street.   According to WSVN, the county has handed out 680 safety notices for downed pool barriers, and another 177 electrical hazard safety notices. Reason reached out to the county to confirm those numbers, but has not received a reply. From what can be gleaned from the WSVN story and from county code enforcement procedures, these safety notices appear to be just warnings, meaning no fines have been handed out as of yet. Reason tried to confirm this with the county as well, but was again rebuffed. Still, these warnings carry with them a duty to correct the violation within a specific window of time. That might not even be possible for some residents, given how many businesses are still out of operation. As Perez said of the day he got his ticket, "All the stores were closed. It's not like I can go to Home Depot and find some temporary barrier."

Hurricane Irma challenges Florida grocery pipeline - Orlando Sentinel: Hurricane Irma has pushed Florida’s grocery supply line to the brink, leaving shelves empty of staples days after the storm passed. Even a full week after the storm, some stores had empty spaces and shortages of basic items. Despite lessons learned from multiple hurricanes in 2004 and 2005, store operators said they have never dealt with a storm that impacted nearly the entire state, leaving 60 percent of Florida without power and some communities with wind and flooding damage. Watching Irma’s long, powerful march toward Florida for more than a week also taxed supplies, giving shoppers a reason to stock up on a big scale. Some stores couldn’t operate because of outages; some couldn’t get food because distribution lines were slowed down. When they did open, much of their perishable food had spoiled. There was a surge in demand from customers who hadn’t shopped in days and saw food spoil. Stores and retail analysts say Hurricane Irma’s size and path made it the perfect storm to cripple Florida’s grocery supply lines. “In terms of damaging the state’s infrastructure of power and clogging roads, Irma’s about as bad as we’ve ever seen,” “Store’s can’t run without power and trucks were held up for three days or more.” Irma showed the strength and weaknesses of the modern food distribution system, where stores rely on daily deliveries of fresh food, Johnston said.

Former EPA official warns of potential food contamination after hurricanes - People in areas affected by hurricanes Harvey and Irma should be alert to the possibility of bacterial contamination of crops from flood waters, former Environmental Protection Agency official Stan Meiburg warned on Thursday. The storms caused widespread damage across Texas and Florida and wiped out hundreds of crops. "The risks involved differ somewhat from area to area," said Meiburg. In Texas, for example, there have been concerns about contamination of rice crops, as well as concerns about livestock, he told CNBC's "Power Lunch." In Florida, there was a significant amount of destruction of the winter vegetable crops, as well as citrus and sugar cane. "The main concerns there have been to make sure that you avoid contamination, and particularly, avoid contact [with] ... food that has been in contact with flood waters," Meiburg said. The Food and Drug Administration said the storms have caused a "substantial" loss of crops, which may be submerged in flood water, exposed to contaminants or susceptible to mold. "Some of the major concerns for crop safety are heavy metals, chemical, bacterial, and mold contamination. In many cases, it is challenging to determine what contaminants are in crops that were submerged by floodwaters," FDA Commissioner Scott Gottlieb wrote in a statement last week. Food processing is also being threatened by loss of electricity, leaking ammonia from cooling systems, and contaminated surfaces, Meiburg said. "If you lose power in food processing plants, you lose some of the ability to handle the food safety, whether in refrigeration or other parts of the process," he said. He said plants will have to be properly cleaned and sanitized before they are used again for food processing and that there must be an adequate supply of clean water.

The cost of coastal capitalism: How greedy developers left Miami ripe for destruction -- As Hurricane Irma bore down on South Florida, hundreds of thousands of people in Miami evacuated, fleeing a storm that, had it struck the city squarely, would have devastated what is now the fourth-largest urban area in America. Even though the storm slipped to the Gulf Coast side of the state, the hurricane flooded streets, shattered windows and sent giant cranes crashing into half-built high-rises.Those cranes, a permanent feature of the rapidly expanding skyline, are symbols of the city’s ability to bounce back. But their skeletal fragments following the storm also serve as a warning: The longtime predatory practices of developers (and their partners in local government) in coastal communities like Miami have fueled racial discrimination and environmental destruction, as well as exacerbated the devastation wrought by storms like Irma and last month’s Hurricane Harvey.Coastal communities should have heeded this warning a century ago.When a Category 4 storm struck South Florida in 1926, it seemed to deliver a deathblow to Miami’s frenzied real estate market. “Gaping structures, tragically uncompleted, are mute reminders of ambitious schemes for apartments, casinos, country clubs,” one reporter later suggested, surveying the wreckage. All of the symbols of frenetic development had “vanished like a soap bubble.”Not for long. No sooner had the rains stopped and floodwaters receded, than coastal capitalists ripped a page from their pre-storm playbook to rebuild South Florida’s economy. Before the storm white “land grabbers” had terrorized African Americans into selling or abandoning their properties. After the storm, the capitalists sent armed National Guardsmen into Miami’s “Colored Town” to conscript, at the barrel of a gun, black laborers in clearing debris from the choice properties along Miami Beach, where blacks were barred from living. Developers, meanwhile, busied themselves robbing the land of its natural defense mechanisms, draining thousands of acres of wetlands that absorbed floodwaters and building sea walls and other structures designed to protect coastal property and hold back the sea. Both helped to create the Florida we know today.

The stunning price tags for Hurricanes Harvey and Irma, explained -- Estimates for the cost of Hurricane Harvey’s damage have come in at $65 billion, $180 billion, and as high as $190 billion — the last of which would make it the costliest disaster in US history. The numbers from the second record-breaking storm that hit the US this summer, Hurricane Irma, meanwhile, are still rolling in. But totals range from $50 billion to $100 billion. To appreciate how staggering these figures are, consider that they could be enough to make the $18.57 trillion US economy lose a step, knocking between 0.6 percent and 0.8 percent off of US GDP growth this quarter, according to projections from investment banks. While these estimates vary based on how different factors are measured and modeled, what’s consistent is that Harvey and Irma are just the latest in a growing stream of increasingly expensive megadisasters, some of them linked, as these storms were in part, to climate change. And the numbers have huge implications for the insurance industry, city planning, decisions about rebuilding, and the lives of millions of Americans.Let’s unpack them and explore what they mean not just for Texas and Florida, but for all communities at risk of intense hurricanes in the future. Here’s one way to put the rising number of costly disasters in perspective: Nine of the 10 costliest Atlantic hurricanes (not including Harvey or Irma) have occurred since 2000.  According to NOAA’s National Centers for Environmental Information, the United States has suffered 212 weather and climate disasters since 1980 that have cost more than $1 billion, totaling $1.2 trillion. (You can see the trend in this great infographic from National Geographic.) NCEI’s Smith explained that a storm’s price tag includes what can be measured: blown-over homes, shattered glass office towers, flooded factories, and waterlogged machinery. Estimates also include losses to public infrastructure like roads and bridges, crop damage, and reductions in work hours.  The economic damage from a hurricane can continue to rise for months, if not years.

U.N. provides Cuba with food aid after Irma rips up coast (Reuters) - The United Nations’ World Food Programme said on Saturday it was launching a $5.7 million operation in Cuba to help feed nearly 700,000 people in areas most affected by Hurricane Irma. The monster storm ripped last weekend along the length of the northern coastline of the Caribbean’s largest island, tearing off roofs, wrecking the power grid and damaging crops. “This hurricane just went down the entire coastline, the volume of impact is just unprecedented,” WFP Executive Director David Beasley said during a visit to Havana, after meeting with Cuban Vice President Miguel Diaz-Canel. The WFP already had more than 1,600 tonnes of food pre-positioned around Cuba available to distribute and had funds to buy more. It would start by distributing for free rations of rice and beans in the most vulnerable areas. Irma’s impact on food availability in the a nation of 11 million inhabitants may be both short and medium-term, Beasley said. Executive Director of the U.N. World Food Programme David Beasley (C), walks inside a damaged house due to Hurricane Irma during a visit to Havana, Cuba, September 16, 2017. REUTERS/Alexandre Meneghini“We are talking about 60,000 hectares of agricultural land that have been dramatically impacted, banana trees, citrus, rice maize, everything,” Beasley said. Cuba would need to assess the soil’s salinity to ascertain how that would affect the next planting season, he said.

Islands Seek International Funding for Hurricane Recovery - As Hurricane Maria thunders through the Caribbean, island leaders still reeling from Hurricane Irma are calling on international organizations to provide money to help vulnerable countries recover from devastating storms linked to climate change.In the Bahamas, emergency evacuations crippled the tourism on which the islands depend, said Darren A. Henfield, the country’s minister of foreign affairs. The Dominican Republic, spared the worst of Hurricane Irma, fears a future of devastated beaches undermining decades of investment, President Danilo Medina said. And on Barbuda, where Hurricane Irma destroyed everything in its path this month, there is not a single person left, officials said. In one day, the population of neighboring Antigua swelled when it took in about 1,400 men, women and children who fled Barbuda. Rodney Williams, the governor general of Antigua and Barbuda, said that in addition to the estimated $300 million cost of rebuilding Barbuda, Antigua was grappling with how to provide shelter, schools and medical care to hundreds of displaced people. “Today I ask how your governments will respond to this international crisis. We ask the international community to help us, not because we want to outstretch a begging bowl, but because forces far beyond our control have pushed us to this dire situation,” Mr. Williams told the United Nations on Monday. “Rebuilding Barbuda is not a task we can undertake alone.” Roosevelt Skerrit, the prime minister of Dominica, where Hurricane Maria made landfall late Monday as a Category 5 hurricane, pressed “friendly nations and organizations” to provide a helicopter so that he could survey the “widespread devastation,” which he described as “mind-boggling.” In a special session convened by Secretary General António Guterres before the official opening of the 72nd United Nations General Assembly, those Caribbean leaders and others appealed to the body to rethink humanitarian aid. They asserted that because climate change is fueling more intense storms, vulnerable countries must have a better way to recover than to beg for money with each new devastation.

"Whole Towns Have Been Wiped Out" Hurricane Maria Devastates Tiny Caribbean Island Of Dominica - (video) In a testament to the sheer power of Hurricane Maria, the most destructive storm to hit the Caribbean in nearly a century, civilization on the tiny island of Dominica was essentially wiped out after Maria – then a category 5 storm – battered the island with 160 mph gusts, leveling whole towns and wiping out the island’s electricity and communications infrastructure. The death toll on the island has climbed to 7 – but a complete count of casualties likely won’t be possible for at least a few more days, as the island’s shaken residents sift through the debris and contemplate what to do now that everything they and their neighbors owned has been destroyed. When CNN flew over the island to survey the damage, it captured startling footage depicting whole villages decimated and thousands of trees snapped in half across the island. Houses ripped open. Evidence of numerous landslides. The island’s agriculture-based economy has been totally wiped out. As CNN points out, the complete destruction of the island’s economy will compound the damage wrought by the storm by hopelessly complicating the recovery effort. Officials of nearby islands confirmed that the only electricity available on the island is coming from backup generators and car batteries. Philmore Mullin, head of Antigua and Barbuda’s National Office of Disaster Services, told CNN the only power available on the island was from emergency generators and car batteries. “Damage is severe and widespread. We know of casualties, but not in detail. We’ve heard of many missing but we just don’t know much at the moment.” According to the Guardian, Ross University school of medicine, which is based in Dominica, said it would being to evacuate its students, more than 80% of whom are US citizens, with close to 10% from Canada, by boat to St Lucia on Thursday if the weather permits.

Hurricane Maria: Whole of Puerto Rico without power - BBC News: Hurricane Maria has knocked out power to the entire island of Puerto Rico, home to 3.5m people, emergency officials have said. Abner Gómez, head of the disaster management agency, said none of the customers of Puerto Rico's Electric Power Authority had any electricity. The US National Hurricane Center said "catastrophic" flooding was sweeping parts of the island. Maria is moving away from Puerto Rico, weakening to a category two storm. "When we are able to go outside, we are going to find our island destroyed," Mr Gómez was quoted as saying by the El Nuevo Dia newspaper. "It's a system that has destroyed everything in its path." Earlier, Mr Rossello asked President Donald Trump to declare the island a disaster area after the storm unleashed heavy flooding and life-threatening winds. He said major damage was inevitable, although 500 shelters had been established to protect people. The devastating storm has already left seven people dead on the island of Dominica, which was badly affected on Monday. Aerial footage shows flattened houses and the death toll on Dominica is likely to rise, with details remaining scant as communication links are down. 

Maria’s Parting Shot: Flash Floods Hammer Puerto Rico - A flash flood emergency was in effect for the entire main island of Puerto Rico at midday Thursday, as rainbands feeding into Hurricane Maria continued to stream north across the U.S. territory. Cat 3 Maria was centered more than 150 miles northwest of Puerto Rico at 11 am EDT. Intense rainbands extending well south of Maria’s center were lashing most of the Dominican Republic and parts of Puerto Rico. Power remains out across Puerto Rico on Thursday, and it may be weeks or months before widespread restoration of the island’s power grid, which was already reeling from Hurricane Irma even before Maria struck. Widespread damage and flooding was also reported in the U.S. Virgin Islands, where a 24-hour curfew is in effect. At least 7 deaths have been confirmed in hard-hit Dominica, a toll expected to rise as rescuers work their way into remote parts of the island. Some 90% of the structures in Dominica are reported to be damaged or destroyed, and there has been massive loss of trees across the once-lush landscape. Two deaths in Guadelope and one death in Puerto Rico are also being attributed to Maria. Satellite imagery on Thursday morning showed that Maria was well-organized, with a large area of very intense thunderstorms surrounding a huge 45-mile-diameter eye. The Hurricane Hunters have not detected much change in Maria’s intensity since 2 am, with the pressure holding nearly steady at 959 – 960 mb, and the surface winds maintaining a low-end Category 3 velocity, 115 mph, as of 11 am EDT. Maria’s spiral bands were still pounding Puerto Rico and the Virgin Islands with heavy rains, and extreme flash flooding will continue to occur on those islands for the much of the day. The same is true of northern and eastern parts of the Dominican Republic, where 8 – 16” of total rainfall is predicted. Maria’s spiral bands were also beginning to affect the southeast Bahamas and Turks and Caicos Islands, where NHC is predicting rainfall amounts of 8 – 16” from Maria. These islands can expect heavy rains to increase through the day and peak on Friday, when Maria makes its closest approach. These islands will be on the weaker (left front) side of Maria, but the islands closest to Maria are likely to see sustained winds near hurricane force and a dangerous storm surge of up to 9 – 12’.

Hurricane Maria Leaves Puerto Rico Facing Months Without Power - Millions of people across Puerto Rico woke up Thursday to a grim new reality.  Hurricane Maria, the most powerful storm to hit the U.S. territory in almost a century, ravaged the island, demolishing homes and knocking out all electricity. It could take half a year to restore power to the nearly 3.5 million people who live there. The eye of the storm moved offshore overnight, but the danger remained Thursday: Intense flooding was reported, particularly in San Juan, where many residential streets looked like rushing rivers. The storm has been blamed for the deaths of 18 people, including two in Puerto Rico, but many fear that toll could climb as authorities were beginning to assess the extent of the damage and search for survivors.  San Juan Mayor Carmen Yulín Cruz said the devastation in the capital city was unlike any she had ever seen. "The San Juan that we knew yesterday is no longer there," Cruz told MSNBC. "We're looking at 4 to 6 months without electricity."  Yennifer Álvarez Jaimes, Gov. Ricardo Rosselló's press secretary, said all power across the economically strained island had been knocked out.  The storm, with its fierce winds and heavy rain, toppled trees, shattered windows, and ripped roofs and doors off homes. Widespread flooding blocked many highways and streets across the island Thursday, creating a maze that forced drivers to go against traffic. Gregorio Cortes 39, a doctor in Vistamar Marina, a community in Carolina, Puerto Rico, said several highways were impassible. "This morning I wasn’t able to get across several major highways here since there’s flooding everywhere and fallen trees," he said by phone Thursday evening.  Cell phone communication was completely down from Thursday morning until around 4 p.m., he said, leaving Cortes unable to reach his parents and grandparents.  "It’s a feeling of impotence that you have you want to do so much and you can do so little," he said.

Puerto Rico After Maria: No Power, No Cell Signal, and Lots of Damage -- Puerto Rico is emerging crippled after the most powerful hurricane to hit the U.S. territory in almost a century hobbled its telecommunications system, destroyed its power grid and left communities facing widespread devastation. Puerto Rican authorities warned the island’s 3.4 million residents that they face a long, difficult and expensive path to recovery from Hurricane Maria. Abner Gómez, executive director of the island’s emergency-management agency, said residents should be prepared to sustain themselves without aid for 72 hours, given the severity of the damage, the obstacles to reach people and how thinly stretched government resources are. “It’s a crisis,” said Gov. Ricardo Rosselló in a news conference aired at the only radio station that can still be broadcast across the entire island. He confirmed that there has been one death attributed to the storm. Flooding and mudslides are a “giant problem” especially in rural, mountainous areas, he said, adding that damage to the island’s infrastructure was enormous and the cost to fix it will be “humongous.”  The government’s main goals are to open seaports and airports so aid shipments can flow in, as well as to restore telecommunications. The governor said he hasn’t been able to make contact with 85% of the island’s 78 municipalities. “I haven’t been able to communicate with my parents,” he said. More than 95% of Puerto Rico’s wireless cell sites are currently out of service, the Federal Communications Commission said Thursday. That is worse than immediately following Hurricane Irma, which knocked out 56% of the island’s wireless network. Federal Emergency Management Agency Administrator Brock Long said restoring electricity to the island “could take weeks or many, many months.” Authorities are still trying to reach communities that are dealing with historic flooding that has stranded residents.  “Puerto Rico was absolutely obliterated,” President Donald Trump said Thursday. “Their electrical grid is destroyed. It wasn’t in good shape to start off with. But their electrical grid is totally destroyed.” FCC Chairman Ajit Pai said the agency is reaching out to telecom providers to look for ways to help get the communications networks back online. About a week after Irma hit, all but 6% of Puerto Rico’s cell sites were back online.  “Unfortunately, getting Puerto Rico’s communications networks up and running will be a challenging process, particularly given the power outages,” Mr. Pai said.

In the Murk --Kunstler -Welcome to America’s first experiment in the World Made By Hand lifestyle. Where else is it going? Watch closely. Ricardo Ramos, the director of the beleaguered, government-owned Puerto Rico Electric Power Authority, told CNN Thursday that the island’s power infrastructure had been basically “destroyed” and will take months to come back.   “Basically destroyed.” That’s about as basic as it gets civilization-wise.  Residents, Mr. Ramos said, would need to change the way they cook and cool off. For entertainment, old-school would be the best approach, he said. “It’s a good time for dads to buy a ball and a glove and change the way you entertain your children.”  Meaning, I guess, no more playing Resident Evil 7: Biohazard on-screen because you’ll be living it — though one wonders where will the money come from to buy the ball and glove? Few Puerto Ricans will be going to work with the power off. And the island’s public finances were in disarray sufficient to drive it into federal court last May to set in motion a legal receivership that amounted to bankruptcy in all but name. The commonwealth, a US territory, was in default for $74 billion in bonded debt, plus another $49 billion in unfunded pension obligations.So, Puerto Rico already faced a crisis pre-Hurricane Maria, with its dodgy electric grid and crumbling infrastructure: roads, bridges, water and sewage systems. Bankruptcy put it in a poor position to issue new bonds for public works which are generally paid for with public borrowing. Who, exactly, would buy the new bonds? I hear readers whispering, “the Federal Reserve.” Which is a pretty good clue to understanding the circle-jerk that American finance has become.Some sort of bailout is unavoidable, though President Trump tweeted “No Bailout for Puerto Rico” after the May bankruptcy proceeding. Things have changed and the shelf-life of Trumpian tweets is famously brief. But the crisis may actually strain the ability of the federal government to pretend it can cover the cost of every calamity that strikes the nation — at least not without casting doubt on the soundness of the dollar. And not a few bonafide states are also whirling around the bankruptcy drain: Illinois, Connecticut, New Jersey, Kentucky. Constitutionally states are not permitted to declare bankruptcy, though counties and municipalities can. Congress would have to change the law to allow it. But states can default on their bonds and other obligations. Surely there would be some kind of fiscal and political hell to pay if they go that route. Nobody really knows what might happen in a state as big and complex as Illinois, which has been paying its way for decades by borrowing from the future. Suddenly, the future is here and nobody has a plan for it.

NWS Declares "Extremely Dangerous Situation" After Puerto Rico Dam Fails -- With electricity and cell phone service still offline across most of hurricane-damaged island,NBC reports that a dam in northwest Puerto Rico has failed, causing even more flash flooding and prompting emergency evacuations. Guajataca Dam operators said it failed at 2:10 pm ET, prompting the NWS to issue a flash flood emergency warning for Isabela and Quebradillas municipalities.  "This is an EXTREMELY DANGEROUS SITUATION. Busses are currently evacuating people from the area as quickly as they can," NWS San Juan said.A warning was also issued for residents living in areas surrounding the Guajataca River who, according to NEW San Juan "should evacuate NOW" as their lives are in danger.215PM FLASH FLOOD EMERGENCY for A Dam Failure in Isabela Municipality y Quebradillas Municipality in Puerto Rico... #prwx pic.twitter.com/L3utOjxspR— NWS San Juan (@NWSSanJuan) September 22, 2017  At 210 PM, dam operators reported the Guajataca Dam is failing causing flash flooding downstream on the Rio Guajataca. #PRWX— NWS San Juan (@NWSSanJuan) September 22, 2017  This is an EXTREMELY DANGEROUS SITUATION. Busses are currently evacuating people from the area as quickly as they can #prwx— NWS San Juan (@NWSSanJuan) September 22, 2017 According to federal reservoir data, the lake behind the dam, Lago de Guajataca, rose more than three feet between Tuesday and Wednesday, when the storm was still directly over the island. More recent data were unavailable.More than 95% of Puerto Rico’s wireless cell sites are currently out of service, according to the FCC. That is worse than the aftermath of Hurricane Irma, which knocked out 56% of the island’s wireless network. Federal Emergency Management Agency Administrator Brock Long said restoring electricity to the island “could take weeks or many, many months.”

Structural Damage at Guajataca Dam Prompts Evacuations in Puerto Rico --A dam in northwestern Puerto Rico suffered structural damage on Friday, the governor said at a news conference, prompting evacuations of areas nearby in the aftermath of Hurricane Maria.“Close to 70,000 is the estimate of people that could be affected in the case of a collapse,” the governor, Ricardo Rosselló, said about the Guajataca Dam, which is operated by the Puerto Rico Electric Power Authority. “We don’t know the details. It’s time to get people out.”The news about the dam was a dramatic sign that the scale of troubles left behind by the storm were just being understood. Power remained out and phone service was still limited. Aerial footage from WeatherNation, a broadcast and digital network, showed a large volume of water flowing over the dam’s spillway. The water had eroded part of the spillway and some of the land between the spillway and the dam. But there was no sign that the reservoir had overtopped the dam itself. A flash flood warning was previously issued by the National Weather Service for the municipalities of Isabela and Quebradillas, in the immediate areas of the dam. “This is an extremely dangerous and life-threatening situation,” the service said in an advisory.  Messages sent to the power authority about the condition of the dam were not immediately returned.The National Guard has been activated in the area, the governor said. “Its been hard to see infrastructure deteriorate in Puerto Rico,” he said, “but it has been harder to meet citizens who have lost it all.”

Why Hurricane Maria Surprised Forecasters By Getting So Strong So Fast - Hurricane Maria, currently headed for Puerto Rico, stunned forecasters by rapidly intensifying from a Category 1 storm to a Category 5 within a 15-hour period on Monday, battering the island of Dominica in the process. Indeed, the forecast error for Maria’s wind speed is one of the worst for a 24-hour hurricane forecast in the past five years. The National Hurricane Center expected Maria to intensify, but not anywhere close to the degree that it did. The center’s 11 p.m. forecast on Sunday night said Maria would be a low-end Category 3 storm with maximum sustained winds of 115 mph when it got close to Dominica on Monday evening. In reality, the wind speed ended up being 160 mph, a forecasting error of 45 mph. The difference in these wind speeds can be the difference between life and death. The National Hurricane Center says that in storms with Category 3 winds, homes will sustain major damage. Category 5 winds can destroy entire homes and leave areas uninhabitable for weeks or months. Forecast intensity errors like what occurred with Maria happen very rarely. The average National Hurricane Center 24-hour forecast error for tropical cyclone wind speed from 2012 to 2016 was 9 mph. According to this graphic put together by the National Hurricane Center, more than 95 percent of 24-hour storm forecasts have a smaller wind speed error than the Sunday evening forecast for Maria did. Brian Tang, a meteorologist at the University at Albany, told me via email that hurricane models are not good at predicting rapid intensification events such as Maria because so few of them occur. He pointed out, as did forecaster Ian Livingston of The Washington Post’s Capital Weather Gang in an email to me, that this is especially the case for hurricanes with compact cores like Maria’s. Philippe Papin, also a meteorologist at the University at Albany, noted that one model showed Maria had a far greater chance than normal of rapid intensification, even if it wasn’t the most likely outcome. Maria is arguably the second hurricane this season that caught forecasters at least a little off guard before making landfall. Although Hurricane Harvey’s location and wind speed were fairly well forecast in the immediate lead-up to landfall in Texas, the storm essentially came out of nowhere 60 hours earlier. No forecasts for Harvey were even issued by the National Hurricane Center from the evening of Aug. 19 to the morning of Aug. 23. The storm made landfall on the evening of Aug. 25. Even in the 11 p.m. Aug. 23 forecast, Harvey was expected to be only a Category 1 hurricane with maximum sustained winds of about 75 mph on the evening of Aug. 25. Instead, right before landfall, it was a Category 4 storm with 130 mph winds, a forecast error of 55 mph.

National Guard chief: Climate change possibly causing 'bigger, larger, more violent' storms - The National Guard's top general said Tuesday that climate change may be causing storms to become “bigger, larger, more violent,” which he said underscores the need to keep service members spread across the country to respond. “I do think that the climate is changing, and I do think that it is becoming more severe,” Gen. Joseph Lengyel, chief of the National Guard Bureau, told reporters Tuesday morning in response to a question from The Hill. “I do think that storms are becoming bigger, larger, more violent. You know, I never know if this one speck of time is an anomaly or not, but, you know, we've all seen now three Category 5 storms that popped out in a period of a month.” The National Guard has activated thousands of members in recent weeks to help with recovery efforts during and after Hurricanes Harvey and Irma. The Guard is also preparing to respond to Hurricane Maria, which is expected to reach Puerto Rico, a U.S. territory, by Thursday. At its most severe, Harvey reached a peak of Category 4, while Irma became a Category 5. Maria was declared a Category 5 hurricane on Tuesday. Asked Tuesday how climate change has affected his preparations for natural disasters, Lengyel said recent storms underline the need to have a robust Guard presence in each state. “It impacts me because the National Guard does provide — we are the military domestic response force. We keep that as part of our job jar,” he said at the Defense Writers Group breakfast. “For us to do that job, we have to have some force structure that’s located were the events might happen. “So whether that’s in Oklahoma, where you have a lot of tornadoes, or whether that’s in the northwest, where you have a lot of fires, or whether that’s in the Gulf or along the East Coast, we need force structure that is in all 50 states, the territories and the District of Columbia, so that we can respond.” 

The growing debate about the Arctic’s influence on hurricanes - Over the past few years, some climate scientists have begun to suggest that warming in the Arctic could affect the flow of large-scale atmospheric currents — notably the jet stream, a huge, wavy air current that flows from west to east around the world and is a major influence on global weather patterns.Some scientists have said this theory could help explain the remarkable trajectory of Hurricane Sandy, which crashed into the New Jersey coast in 2012. And now, they say that the unusual behavior of Hurricane Harvey — which stalled over Texas, dumping record amounts of rain — could be related to Arctic-driven changes in the jet stream, as well.In a much-cited Facebook post, published in the aftermath of Harvey’s landfall, climate scientist Michael Mann of Pennsylvania State University noted that Harvey’s devastating stalling behavior was made possible by weak prevailing winds, which were associated with “a greatly expanded subtropical high pressure system over much of the U.S. right now, with the jet stream pushed well to the north.”And he added that, while it’s still a “tenuous” idea, the phenomenon of weather patterns becoming locked in place for unusually long periods of time “appears to be favored by human-caused climate change.” In a recent statement, climatologist Stefan Rahmstorf of the Potsdam Institute for Climate Impact Research, made a similar observation, noting that the effects of Arctic warming can slow atmospheric circulation in the mid-latitudes during the summer, allowing weather systems to “move less and stay longer in a given location — which can significantly enhance the impacts of rainfall extremes, just like we’re sadly witnessing in Houston.”

Asia's glaciers to shrink by a third by 2100, threatening water supply of millions - Asia’s mountain glaciers will lose at least a third of their mass through global warming by the century’s end, with dire consequences for millions of people who rely on them for fresh water, researchers have said.This is a best-case scenario, based on the assumption that the world manages to limit average global warming to 1.5C (2.7F) over pre-industrial levels, a team wrote in the journal Nature.“To meet the 1.5C target will be a task of unprecedented difficulty,” the researchers said, “and even then, 36% (give or take 7%) of the ice mass in the high mountains of Asia is projected to be lost” by 2100.  With warming of 3.5C, 4C and 6C respectively, Asian glacier losses could amount to 49%, 51% or 65% by the end of the century, according to the team’s modelling study. The high mountains of Asia comprise a geographical region surrounding the Tibetan plateau, holding the biggest store of frozen water outside the poles. It feeds many of the world’s great rivers, including the Ganges, the Indus and the Brahmaputra, on which hundreds of millions of people depend. Nearly 200 nations adopted the Paris agreement in 2015, which sets the goal of limiting warming to a level “well below” 2C, while “pursuing efforts” to achieve a lower ceiling of 1.5C. Earth’s surface has already warmed by about 1C, according to scientists. For high warming scenarios, experts predict land-gobbling sea-level rise, worsening storms, more frequent droughts and floods, species loss and disease spread. The Asian high mountains, the new study said, were already warming more rapidly than the global average. A global temperature rise of 1.5C would mean an average increase in the region of about 2.1C, with differences between mountain ranges – all of which will warm by more than 1.5C. The Hindu Kush mountain range would warm by about 2.3C and the eastern Himalayas by 1.9C, the study forecast. “Even if temperatures stabilise at their current level, [glacier] mass loss will continue for decades to come,” the researchers added.

The Rocky Mountains' Largest Glaciers Are Melting with Little Fanfare -- The largest concentration of glaciers in the American Rocky Mountains are melting, unseen, in this remote corner of Wyoming.  The Wind River Range cuts a 120-mile path across western Wyoming, rising from the wavelike sand dunes of the Red Desert in the south and terminating amid the rolling forests that ring the entrances to Yellowstone and Grand Teton national parks in the north.  The range encompasses two national forests, three federal wilderness areas and the Wind River Indian Reservation. More than 100 glaciers cover about 10,000 acres in the Wind River Range, according to a recent study by researchers at Portland State University. No American mountain range outside Alaska and Washington is covered in more ice.The Wind River glaciers remain some of the least understood ice sheets in North America. Researchers don't have a firm grasp on the amount of water locked away in the alpine ice, and estimates of how much they contribute to local streams vary widely.Answering those questions requires penetrating a rugged wilderness nearly the size of Rhode Island and climbing to elevations between 11,000 feet and 13,800 feet, where the glaciers hug the crest of the Continental Divide.Today, a growing number of scientists are pushing into the backcountry to understand these icy reservoirs. Their concern: The Wind River glaciers are retreating just when Wyoming needs them most.   “If you haven't had proximity to these glaciers, if you haven't thought about where water comes from, it would be easy to understate or underestimate the implications of glacial ice loss in a state that has predominantly a semi-desert climate and certainly by contemporary climate models is going to be pretty significantly impacted by climate change,” said Jacki Klancher, a professor of environmental science at Central Wyoming College.

Arctic sea ice once again shows considerable melting  -- This September, the extent of Arctic sea ice shrank to roughly 4.7 million square kilometres, as was determined by researchers at the Alfred Wegener Institute, the University of Bremen and Universität Hamburg. Though slightly larger than last year, the minimum sea ice extent 2017 is average for the past ten years and far below the numbers from 1979 to 2006. The Northeast Passage was traversable for ships without the need for icebreakers.The sea ice in the Arctic is considered a critical element in climate processes, and a valuable early-warning system for global warming. Accordingly, the September minimum extent is an important indicator of climate change. Despite an especially warm winter, the current extent of sea ice does not represent a new record low; nevertheless, the amount of ice loss is massive. As sea-ice physicist Marcel Nicolaus from the Alfred Wegener Institute, Helmholtz Centre for Polar and Marine Research (AWI) explains, "This year's sea ice extent is again on a very low level: the observed September value of the past eleven years has consistently been lower than in any of the previous years." This winter, the Arctic remained unusually warm, and the sea-ice coverage in March was lower than in any March before. "Thanks to the relatively cold summer, the sea ice managed to bounce back somewhat, but this year's September minimum is by no means a good sign," stresses Lars Kaleschke from Universität Hamburg's Center for Earth System Research and Sustainability. "Though the amount of sea ice is of course subject to natural fluctuations, the long-term decline is obvious." For comparison, the summertime minimums in the 1970s and 1980s were roughly seven million square kilometres.

Melting Arctic ice cap falls to well below average - The Arctic ice cap melted to hundreds of thousands of square miles below average this summer, according to data released late on Tuesday.Climate change is pushing temperatures up most rapidly in the polar regions and left the extent of Arctic sea ice at 1.79m sq miles at the end of the summer melt season.This is the time when it reaches its lowest area for the year, before starting to grow again as winter approaches. The 2017 minimum was 610,000 sqmiles below the 1981-2010 average and the eighth lowest year in the 38-year satellite record. Scientists from the US National Snow and Ice Data Centre (NSIDC) said the rate of ice loss this summer had been slowed by cool mid-summer weather over the central Arctic Ocean. The record minimum came in 2012, when the ice area fell to 483,000 square miles below the 2017 extent.Ted Scambos at NSIDC said the Arctic sea ice had set a record for the smallest winter extent earlier in 2017 and was on track to be close to the 2012 record minimum until July. But a cloudy and cooler than normal August slowed the melting.“Weather patterns in August saved the day,” Scambos said. The fast shrinking Arctic ice cap is increasingly thought to have major impacts on extreme weather patterns much further south, due to its influence on the jet stream. Floods, heatwaves and severe winters in Europe, Asia and North America have all been linked to the Arctic meltdown. “It’s bound to have an impact on global climate,” Scambos said. The 2017 sea ice level fits with an overall steady decline over the decades, but one that varies from year to year, Scambos said. “It’s not going to be a staircase heading down to zero every year,” he said. “[But] the Arctic will continue to evolve towards less ice. There’s no dodging that.”

Bay Area Sues Big Oil For Billions - The cities of San Francisco and Oakland have filed lawsuits against Chevron, Exxon, ConocoPhillips, BP, and Shell for the effect of their activities on climate change: higher sea levels. The cities seek billions in damages to counteract the effects of the changing climate. Reuters quoted San Francisco officials as saying that the five oil companies “knowingly and recklessly created an ongoing public nuisance that is causing harm now and in the future risks catastrophic harm to human life and property.”The companies themselves were restrained in their comments, with Chevron saying the lawsuits would only serve special interests rather than effect a real change, and Exxon finding the claims made by the cities lacking in merit. Conoco and BP did not comment, and Shell said climate change should be addressed by government policy and cultural change rather than by litigation.This is not the first time that communities decided to sue Big Oil like they sued Big Tobacco 30 years ago. Louisiana’s Plaquemines Parish is pursuing 21 different lawsuits against Big Oil for damage to the state’s wetlands, which is causing coastal erosion. Five of the lawsuits have already been scheduled for 2019.Chevron is the defendant in 19 of the 21 cases.California itself is no stranger to such legal action. In July, three coastal communities—Marin and San Mateo Counties, and City of Imperial Beach—filed suits against 37 oil, gas, and coal companies for damage done to the environment through carbon dioxide pollution. The plaintiffs claim the companies have know for half a century that greenhouse gas emissions are conducive to climate change but have deliberately concealed this, leaving the local communities to pick up the check for remedial measures.In all likelihood, this is just the start of a flood of lawsuits as the debate about who should bear the costs of climate change heats up. The dominant opinion seems to be shiftingaway from taxpayers and towards energy companies, as research-based evidence suggests that some of the emissions causing climatic change can be traced back to companies producing oil and gas.

Energy Forecast Sees Global Emissions Growing, Thwarting Paris Climate Accord -- The U.S. government's energy forecasting branch issued its formal international prognosis on Thursday, and it paints a picture of a world still so addicted to fossil fuels that emissions of global warming pollution continue to increase for the foreseeable future. The Energy Information Agency (EIA) projected that worldwide emissions of carbon dioxide from the burning of fossil fuels would grow 16 percent by the year 2040 from the levels of 2015, the year that the nations of the world agreed to the landmark Paris Agreement on climate change that is intended to reverse the trend.Absent any policy changes, the business-as-usual "reference case" findings at the heart of the agency's International Energy Outlook 2017 report can't be squared with the ambitions of Paris, which demand quick action to bring emissions down sharply and avoid the worst risks of a warming planet. The EIA, despite being part of the U.S. Department of Energy, conducts its analyses without regard to the policy agenda of the administration that happens to be in office. In this case, that's the Trump administration, which the report noted has announced its intention to quit the Paris accord, has jettisoned the emission pledge presented by the Obama administration during the treaty negotiations, and has announced that it wants to rewrite the centerpiece of federal climate policy, the Clean Power Plan, which is being challenged in court by the fossil fuel industry and its mainly Republican political allies.The agency said it had "tried to incorporate" the actions of other countries, including China and European states that have made ambitious pledges to cut their emissions, but that "a great deal of uncertainty remains about the full implementation of policies to meet the stated goals, because most commitments have been made only through 2030, and it is uncertain how they will ultimately achieve these goals." The report shows coal at a 20-year-long plateau, natural gas plentiful and growing, carbon-free wind and solar growing rapidly in percentage terms but not fast enough to bring emissions down in absolute terms, and petroleum holding its own as the main source of energy for transportation, despite the arrival of electric vehicles.

New climate change calculations could buy the Earth some time – if they’re right -- A group of prominent scientists on Monday created a potential whiplash moment for climate policy, suggesting that humanity could have considerably more time than previously thought to avoid a “dangerous” level of global warming. The upward revision to the planet’s influential “carbon budget” was published by a number of researchers who have been deeply involved in studying the concept, making it all the more unexpected. But other outside researchers raised questions about the work, leaving it unclear whether the new analysis — which, if correct, would have very large implications — will stick. In a study published in the journal Nature Geoscience, a team of 10 researchers, led by Richard Millar of the University of Oxford, recalculated the carbon budget for limiting the Earth’s warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) above temperatures seen in the late 19th century. It had been widely assumed that this stringent target would prove unachievable — but the new study would appear to give us much more time to get our act together if we want to stay below it. “What this paper means is that keeping warming to 1.5 degrees C still remains a geophysical possibility, contrary to quite widespread belief,” Millar said in a news briefing. He conducted the research with scientists from Britain, Canada, New Zealand, Austria, Switzerland and Norway.  But the new calculation diverged so much from what had gone before that other experts were still trying to figure out what to make of it. “When it’s such a substantial difference, you really need to sit back and ponder what that actually means,”

Trump Reverses, Will Not Withdraw From Paris Climate Deal -- In the latest stunning reversal by the Trump administration, the WSJ reports that White House officials said Saturday "the U.S. wouldn’t pull out of the Paris Agreement, offering to re-engage in the international deal to fight climate change," according to the European Union’s top energy official. As Bloomberg adds, the U.S. has indicated it will not seek a renegotiation of the Paris accord to cut greenhouse gases and instead signaled it wants to re-engage in the agreement, according to EU climate chief Miguel Arias Canete.“At the same time they indicate they intend to rethink how they can re-engage in Paris in ways they consider more favorable for the U.S." Canete told Bloomberg in a phone interview and added that "we assume that means that the U.S. will revisit at some time the targets put forward by the previous administration." “Now we don’t see the messages that they are withdrawing from the Paris agreement radically. We don’t see anymore the message that they will renegotiate the Paris agreement.The message coming from the ministers today is that those present in the meeting will not renegotiate the Paris agreement." The WSJ then further notes that the shift from President Donald Trump’s decision in June to renegotiate the landmark accord or craft a new deal came during a meeting of more than 30 ministers led by Canada, China and the European Union in Montreal. Echoing what he told Bloomberg, “The U.S. has stated that they will not renegotiate the Paris accord, but they will try to review the terms on which they could be engaged under this agreement,” Miguel Arias Cañete said.

Tillerson says U.S. could stay in Paris climate accord (Reuters) - The United States could remain in the Paris climate accord under the right conditions, Secretary of State Rex Tillerson said on Sunday, signaling a shift in tone from the Trump administration, which angered allies with its decision to pull out of the agreement. President Donald Trump is willing to work with partners in the Paris agreement if the United States could construct a set of terms that are fair and balanced for Americans, Tillerson said on the CBS’ “Face The Nation.” Asked if there was a chance the United States could stay in the accord, Tillerson responded, “I think under the right conditions.” “The president said he is open to finding those conditions where we can remain engaged with others on what we all agree is still a challenging issue,” Tillerson said. Trump’s national security adviser, H.R. McMaster, struck a similar tone in television interviews on Sunday in which he said Trump had always been willing to consider changes on the climate pact. “He left the door open to re-entering at some later time if there can be a better deal for the United States,” said McMaster said on ABC’s “This Week” program. “If there’s an agreement that benefits the American people, certainly.” The accord, reached by nearly 200 countries in 2015, was meant to limit global warming to 2 degrees or less by 2100, mainly through pledges to cut carbon dioxide and other emissions from the burning of fossil fuels. 

Tillerson: Trump open to Paris climate deal 'under the right conditions' | TheHill: Secretary of State Rex Tillerson on Sunday suggested President Trump would be open to remaining in the Paris climate deal under the right conditions. "I think under the right conditions, the president said he's open to finding those conditions where we can remain engaged with others on what we all agree is still a challenging issue," he said on CBS's "Face the Nation." Tillerson was asked about a report that the Trump administration is no longer looking to withdraw from the agreement, although Trump announced in June the U.S. would withdraw.The White House denied the reports and said there hasn't been any change in the country's position on the deal. "As the president has made abundantly clear, the United States is withdrawing unless we can re-enter on terms that are more favorable to our country," said White House deputy press secretary Lindsay Walters in a statement. "I think if you recall, the president also said, look, we are willing to work with partners in the Paris climate accord," Tillerson said Sunday. "If we can construct a set of terms that we believe is fair and balanced for the American people and recognizes our economy, our economic interests, relative to others, in particular, the second-largest economy in the world, China," he listed the terms. Tillerson said the plan is to consider other ways the U.S. can work with global partners in the Paris climate agreement. "We want to be productive, we want to be helpful," Tillerson said. 

McMaster says no redo on Paris climate deal decision - National security adviser H.R. McMaster denied Sunday that President Trump is reconsidering his decision to pull out of the Paris climate change accord but said the door remains open to a better agreement down the road. “That's a false report,” McMaster said of published reports over the weekend that the administration might not pull out of the deal after all and might seek new terms instead.“The president decided to pull out of the Paris accord because it's a bad deal for the American people and it's a bad deal for the environment,” he said on “Fox News Sunday.”The Wall Street Journal and Agence France-Presse had cited a top European climate official as saying that the United States was seeking ways to remain a party to the deal. The White House denied those reports in a statement Saturday, and McMaster underscored the U.S. position Sunday. “The president's ears are open if, at some point, they decide they can come forward with an agreement that addresses the president's very legitimate concerns with Paris,” McMaster said.Trump had announced in June that the United States would begin a three-year process of withdrawal. He said then that he could revisit the decision if the United States could renegotiate terms he sees as unfair.The U.S. withdrawal was seen as a policy victory for then-adviser Stephen K. Bannon and his deep suspicion of international agreements and obligations. McMaster's disagreements with Bannon over matters of policy, access to Trump and other issues are well known, and McMaster acted to reduce Bannon's role. Last month, Trump dismissed Bannon in a White House shake-up.

McMaster rejects report U.S. will remain in Paris deal as 'false' - National security adviser H.R. McMaster on Sunday shot down a Wall Street Journal story reporting that the U.S. would remain in the Paris climate accord despite President Donald Trump's announcement in June that he would pull the country out. "That's a false report," McMaster told Chris Wallace on "Fox News Sunday." "The president decided to pull out of the Paris accord because it was a bad deal for the American people and a bad deal for the environment."  The Journal reported Saturday that Trump administration officials at a climate summit in Montreal had said the U.S. wouldn't leave the accord after all, citing multiple officials there. "U.S. officials in Montreal, led by White House senior adviser Everett Eissenstat, broached revising U.S. climate-change goals, two participants said, signaling a compromise that would keep the U.S. at the table even if it meant weakening the international effort," The Journal's Emre Peker reported.But McMaster bashed the Paris deal after denying The Journal's story. "It gave the worst polluters the ability to continue polluting and emitting carbon without significantly reducing those levels," McMaster said on "Fox News Sunday." "The president is committed to the cleanest water on Earth, the cleanest air on Earth, to an energy policy that reduces carbon emissions but then also provides clean fossil fuels to generate growth in this country and globally."  McMaster was more equivocal in an interview with George Stephanopoulos on ABC's "This Week." Asked whether the U.S. would remain in the accord if the administration can negotiate better terms before 2020 — the earliest the U.S. can quit the accord under the terms of the deal — McMaster said it was a possibility.  "If there's an agreement that benefits the American people, certainly," he said.

Nicaragua to Sign Paris Agreement, Leaving Trump Alone With Syria - When President Donald Trump decided to pull out of the Paris climate agreement in June, the United States joined the only two countries of the 197 nations in the U.N. Framework Convention on Climate Change that declined to sign the 2015 accord: Syria, which has been embroiled in a full-scale civil war for six years; and Nicaragua, as its leaders felt the pact was not strong enough to fight climate change . But now, Nicaraguan President Daniel Ortega said his country will sign the agreement "soon," Managua-based TV station 100% Noticias reports. Ortega said on state TV that Nicaragua will join the global action plan to limit temperature rise to well below 2°C to avoid dangerous climate change. He is doing so out of "solidarity" with countries that are the "first victims" to the effects of climate change and are the most vulnerable to climate-related natural disasters, including countries in Africa, Asia, Latin America and the Caribbean.  As Quartz points out, Ortega's move leaves Trump in a two-member club with Syrian president Bashar al-Assad, one of the world's most brutal dictators.  Some mixed signals about Trump's Paris withdrawal arose last week, but a White House official said Monday: "Consistent with the President's announcement in June, we are withdrawing from the Paris Agreement unless we can reengage on terms more favorable to the United States."

Climate Change Enabling US Military to Play Greatly Enlarged Domestic Role - naked capitalism - Yves here. I’m gobsmacked to see Michael Klare take a relatively sunny view of the greatly increased role the US armed forces have already been taking in responding to climate-change-induced disasters. Long term military planners have been writing since at least the early 2000s that climate change would result in destabilizing mass migrations as well as conflicts resulting from more competition for critical resources like potable water. Yet Klare can’t even consider the possibility that the same factors will be at work here. Notice the disconnect: With this in mind, a group of officers — active duty as well as retired — endeavored to persuade top officials to make climate change a central focus of strategic planning…because climate change was sure to generate more conflict abroad and more emergencies at home. It is naive to think that climate change won’t also produce conflict at home. All Klare flags as dangers of the routinization of military operations at home via participation in disaster response is that the US has committed itself to even more misadventures abroad, like poking China in the eye in the South China Sea (which we should have addressed a long time ago if we were so inclined) while having bigger duties in the US: As a result, decisions will have to be made about ending American conflicts abroad and refocusing domestically or that overstretched military will simply swallow even more of the government’s dollars and gain yet more power in Washington. This seems awfully understated. The endgame, if climate change is not addressed, is a US with the military effectively in charge as it becomes more difficult to deal with increasing numbers of people who become permanently displaced as a result of climate change.

Administration officials meet to develop climate strategy - POLITICO: Trump administration officials huddled at the White House on Wednesday in a bid to chart a more cohesive energy and environmental policy strategy, including a game plan for communicating its position on climate change, according to three people familiar with the meeting. The meeting included more than a dozen deputy-level officials from the White House’s various policy councils, as well as representatives from federal agencies such as the EPA and the Energy Department. The goal of the meeting was to develop a forward-looking strategy that goes beyond early efforts by the administration to overturn former President Barack Obama’s regulations. Participants emphasized the importance of coming up with a way to frame President Donald Trump's energy and environmental objectives. Several officials at the meeting proposed highlighting the potential for new energy technology innovation and job creation, according to the people familiar with the meeting. Officials also discussed how to combat the public perception that the administration is out of touch with climate science, sources said. The White House declined to comment. One administration official said the meeting focused on “big picture climate strategy,” and had less to do with the nitty-gritty policy details of the Paris climate change agreement or Obama’s climate regulations for power plants. Wednesday’s meeting marks the latest effort by chief of staff John Kelly to formalize the policymaking process in the West Wing. Kelly has called for more deputy-level strategy sessions on a range of policy issues. Administration officials said there were no final decisions at Wednesday’s meeting, and they expect additional meetings in the coming weeks. 

Naomi Klein Warns Europe May Water Down Paris Accord to Win Support from Trump -- Democracy Now! - President Donald Trump on Tuesday is scheduled to address the United Nations General Assembly. Climate change is expected to be high on the agenda at this year's gathering.As the world leaders meet, another major storm—Hurricane Maria—is gaining strength in the Caribbean and following a similar path as Hurricane Irma. The current forecast shows Maria could hit Puerto Rico as a Category 4 storm as early as Wednesday. The U.S. Virgin Islands, which were devastated by Irma , also appear to be in line to be hit by Maria.Meanwhile, The Wall Street Journal reported over the weekend that the Trump administration is consideringstaying in the Paris climate agreement , just months after the president vowed to pull out of it. The White House denied the report. Secretary of State Rex Tillerson on Sunday signaled Trump may back away from the Paris accord, but National Security Adviser H.R. McMaster gave a different message on Fox News Sunday. We speak with best-selling author Naomi Klein, a senior correspondent for The Intercept. Her most recent book , "No Is Not Enough: Resisting Trump's Shock Politics and Winning the World We Need," has been longlisted for a National Book Award.

EPA labs across U.S. face consolidation as budget cuts loom : (Reuters) - The U.S. Environmental Protection Agency is consolidating research and testing laboratories to cut costs, sparking criticism the move will undercut its ability to respond to regional disasters such as Hurricane Harvey. The EPA plans to relocate or merge at least five labs, including one in Houston responsible for overseeing tests at 13 Superfund program toxic waste sites hit by Harvey flooding, lab employees and union officials said. In June, Kenneth Wagner, an adviser to EPA Administrator Scott Pruitt, suggested to Houston employees at a meeting in June THAT their work could shift to Oklahoma by 2020, they said. Wagner said in an interview that the Houston move is not guaranteed. If the EPA was unable to find federally owned property for the Houston office, there was space available in Oklahoma, he said he told workers. Employees in Texas and elsewhere have been offered buyouts as part of budget cuts. “It’s very alarming,” said Liz Perera, a Sierra Club policy director. “My biggest concern are the labs that actually test air, water and soil, especially around Houston.” Leases at facilities in Chelmsford, Massachusetts; Richmond, California; and Athens, Georgia; and the Office of Research and Development (ORD) in Las Vegas are not being renewed, the workers said. Some labs will be relocated to other federally owned buildings, including in other states. Consolidation will result in fewer labs and the loss of the skills of employees who will not transfer or accept buyouts.

 Chemical industry ally faces critics in bid for top EPA post   — The scientist nominated to head the federal government’s chemical regulatory program has spent much of his career helping businesses fight restrictions on the use of potentially toxic compounds in consumer goods.That record is expected to figure prominently in a Senate confirmation hearing for the scientist, Michael L. Dourson, who critics say is too closely tied to the chemical industry to be its chief regulator.The source of the concern is a consulting group that Mr. Dourson founded in 1995, which has been paid by chemical companies for research and reports that frequently downplayed the health risks posed by their compounds.Four chemicals that are nearly ubiquitous in everyday products — 1,4-dioxane, 1-bromopropane, trichloroethylene and chlorpyrifos — are now under review by agency regulators to determine whether they pose a threat to public health. If confirmed, Mr. Dourson would oversee the review of some chemicals produced by companies that his firm used to represent.Mr. Dourson, 65, worked for the Environmental Protection Agency from 1980 to 1994, according to his résumé, starting as a staff toxicologist, preparing health assessments of various substances. He worked his way up over time, becoming chief of the pesticides and toxics team in 1989, supervising scientists who support the E.P.A.’s regulatory work. Mr. Dourson ultimately oversaw a team of scientists conducting risk assessments for the agency’s offices of water, solid wastes and air quality.The following year he created a nonprofit consulting firm that became a line of first defense for companies facing health and safety challenges from the E.P.A. Mr. Dourson has a popular sideline as a writer of books that combine Bible stories with his views on science. His series, “Evidence of Faith,” is an examination of the intersection of evolution and bible history.

Trump officials adopt 'base'-first strategy on nuclear and coal | TheHill: The Trump administration has found a new strategy for pushing coal and nuclear power over wind and solar. In a shift from the Obama administration, Trump officials are putting a high priority on what is known as “baseload” power in the electric grid. That change has the effect of favoring coal and nuclear power, which can be generated consistently around the clock, no matter what the weather is. Some Trump officials are now considering policies that would let those baseload power plants charge higher prices than their competitors. They are also citing the need to ensure a reliable and resilient electric grid when shaping the regulatory agenda. Advocates for renewable power say that the emphasis on baseload might simply be an excuse to boost coal and nuclear — stated goals of the Trump administration — at the expense of renewable energy. They say the possible harm to the electric grid is overblown. But the industries that would benefit from the new policies say the administration’s concerns are legitimate. They say it’s time to take a hard look at the consequences of the nation’s increasing use of wind and solar power. Neil Chatterjee, chairman of the Federal Energy Regulatory Commission (FERC), said on an agency podcast in August that coal and nuclear “need to be properly compensated to recognize the value they provide to the system” and that they “should be recognized as an essential part of the fuel mix.” At a House hearing weeks later, Chatterjee again spoke of the importance of coal. “Being from Kentucky, I have seen first hand the importance of coal-fired generation and what it means for the delivery of not just affordable, but reliable electricity,” he said, but added that FERC’s policies must be “fuel-neutral.”

With End of Subsidies in Sight, Green Backers Move Cautiously  -- For almost two decades, investors in renewable energy have been able to fall back on government incentives and subsidies to underpin the returns on whatever they back. Now, they’re starting to think they need to proceed with caution. Sharp plunges in the cost of wind turbines and solar photovoltaics have brought forward the time when governments and their regulators can envision renewables standing on their own without support. In some places, notably Germany, technologies that were once the most costly form of green power like offshore wind now are planning to compete at market power prices. Those trends will upend the business model for making money off renewables, with subsidies in retreat and renewables increasingly competing with fossil fuels on price. Institutional investors, bank lenders and private equity firms that have been among the biggest backers of the green-energy industry diverged in their view about what happens next at a Bloomberg New Energy Finance conference in London on Tuesday. “It’s definitely a worry,” said Robert Pottmann, head of renewable energy and new technologies at Munich Ergo Asset Management GmbH, a division of insurer Munich Re Group. “The good old times with feed in tariffs in most countries are gone, at least where we are investing.”Insurers like Pottmann have been lured toward green energy by steady returns on projects underpinned by contracts that have support from government or regulators. That money may dry up as clean power projects take on more exposure to market prices, the executive said. “You need predictable, stable, robust cash flows in order to show the regulator that this investment is appropriate,” he said. “At the end, if you have substantial merchant exposure, then it’s no longer an infrastructure investment.”

In Florida, You Can't Use Your Own Solar Panels In A Crisis - Today’s article focuses on one of the most highly regulated industries in the country, electric utilities. It’s one of the most boring businesses in America. I know this because it fell under the umbrella of my responsibilities during my last Wall Street job, and I could barely read a utilities research report without immediately falling asleep. Nevertheless, as you’ll see in today’s piece, the industry still finds a way to generate large profits while simultaneously harming the people its supposed to service. When I think about solar panels, its not just the use of a renewable resource I find appealing, but also the potential to take energy generation into your own hands; something that can prove quite useful in a major global crisis, or even something more minor like Hurricane Irma’s impact on Florida. The latter could’ve be a lifesaver for some Florida residents recently, but a local electric utility has done everything in its power to deny its customers such freedom. Here’s some of what we learned about this situation from a fascinating article published by the Miami New Times, Why Didn’t FPL Do More to Prepare for Irma?  Since 2005, the company has spent more than $2 billion supposedly girding itself against the next storm, according to a Sun Sentinel piece published before Irma hit. But after Irma, which by most reports brought only Category 1-strength winds to South Florida, by some measures the company did even worse. Despite all of those upgrades, an even larger percentage of FPL’s customer base — 4.4 of 4.9 million customers, almost 90 percent — lost electricity this past weekend.FPL and its parent company, NextEra Energy, have for years heavily influenced state and local politics through donations, making billions in profits each year ($1.7 billion alone in 2016) thanks to favorable state laws that are sometimes literally written by the power company’s own lobbyists.FPL’s lobbying wing has fought hard against letting Floridians power their own homes with solar panels. Thanks to power-company rules, it’s impossible across Florida to simply buy a solar panel and power your individual home with it. You are instead legally mandated to connect your panels to your local electric grid. More egregious, FPL mandates that if the power goes out, your solar-power system must power down along with the rest of the grid, robbing potentially needy people of power during major outages.

Court faults agency for climate analysis of coal mine | TheHill - A federal court faulted the Bureau of Land Management (BLM) Friday for what it said were incorrect assumptions about the climate change impact of mining four coal tracts in Wyoming and the use of that coal. The BLM concluded in 2010 that if companies were not allowed to mine the coal on federal land in Wyoming, the demand for coal would still be so high that it would be mined somewhere else, so the carbon dioxide emissions would be the same whether the federal leases were approved or not. The Court of Appeals for the 10th Circuit ruled Friday that the BLM’s conclusion did not withstand scrutiny. “The BLM did not point to any information (other than its own unsupported statements) indicating that the national coal deficit of 230 million tons per year incurred under the no action alternative could be easily filled from elsewhere, or at a comparable price,” Judge Mary Beck Briscoe, nominated to the Denver court by former President Bill Clinton, wrote in the ruling on behalf of the three-judge panel. “It did not refer to the nation’s stores of coal or the rates at which those stores may be extracted. Nor did the BLM analyze the specific difference in price between [Powder River Basin] coal and other sources; such a price difference would effect substitutability,” she said. The court did not invalidate the leases on three of the tracts of land. Instead, it asked the BLM to fix its environmental review to better account for the climate impact. The ruling is likely to be significant as a case that shows how far federal agencies must go to predict the environmental impacts of the decisions they make. 

Will This Climate Change Ruling Kill U.S. Coal? - Before the discovery of oil and gas, Nigeria thrived on coal. We ran our industries on coal starting from the kalangri cement to rail roads to major factories including breweries. When oil came, people got lazy and everybody went into oil which made the economy suffer eventually. Now the common man found out that they couldn’t even afford kerosene they normally buy then they resorted to cutting down trees to make firewood and charcoal out of it. Now there is a need to go back to revive the coal industry. America knows that the only way to go now is the resuscitation of the coal industry so that the economy will be back to where it used to be. The infrastructure in America, the bridges, the roads, the industries that are falling apart are would be revived through going back to coal. In as much as the oil is there, it cannot handle the infrastructural development which will move the economy forward. We really need to go back to the basics which are the use of coal and it is something that is in abundance in Nigeria especially in Enugu State. Nigerians should ask themselves if Nigeria is now better off with the oil and gas without coal. No! We are not. There are millions of Nigerians displaced who were working in the coal system from the upstream to the downstream, they were all disconnected out of job. So we would find a way to revive the coal industry to bring back jobs and hope to the system. Nigeria will make about 56 billion naira from coal brackets in three years.

First Energy must make environmental improvements to Hatfield’s Ferry landfill – First Energy Corp. must make environmental improvements to the coal ash landfill at its shuttered Hatfield’s Ferry Power Station in Greene County and begin closing portions of the site following a settlement reached last week with the Sierra Club. The settlement finalized Sept. 14 before the state Environmental Hearing Board allows the company to continue operating the facility along the western bank of Monongahela River near Masontown and accept coal ash from other sites, although it has not done so since Hatfield’s Ferry ceased operations in October 2013. First Energy announced in April 2015 it planned to barge coal ash generated from its Bruce Mansfield Power Plant in Beaver County, prompting the Sierra Club to appeal what the company said were “minor” changes to its solid waste permit with the state Department of Environmental Protection. The company decided last November against using the Hatfield’s landfill and instead has been sending the waste to a site in Moundsville, W.Va., since December. The company had been required to find a new site to store coal waste from the Bruce Mansfield plant after the nearby Little Blue Run dump was closed. Charles McPhedran, an attorney with Earthjustice representing Sierra Club in the appeal, said Hatfield’s permit remains active, leaving the door open for it to still be used one day. “They never gave up the permit. They never relinquished the option of Hatfield’s Ferry,” McPhedran said. “The question is whether they need this landfill at all. They’ve filed a permit, but they still haven’t used it.”The agreement does not guarantee the company won’t use the 107-acre landfill south of Route 21 in Monongahela Township at a later date, but it must first make environmental improvements, along with closing some portions as they fill up and not accepting coal ash from other sites until Dec. 1 at the earliest. 

 Groups demand Duke Energy show coal ash disaster maps  — The country's largest electric company is refusing online access to federally mandated maps showing the scope of disaster resulting if a coal-ash pit burst and spilled its toxic muck onto neighboring properties, two environmental law groups said Wednesday.Advocacy groups Southern Environmental Law Center and Earthjustice said they are planning a federal lawsuit to force Duke Energy Corp. to disclose the information withheld for more than a dozen Duke Energy sites in Indiana, Kentucky and North Carolina.The Charlotte-based company is the only electric utility in the country not providing the dam safety information, the groups said. A spot check by The Associated Press found the Tennessee Valley Authority, Alabama Power, Louisville Gas & Electric and Ohio-based American Electric Power among those posting the maps required by a two-year-old U.S. Environmental Protection Agency rule.Duke Energy was required to make public its emergency action plans for each of its coal ash storage sites with a significant risk of serious harm if retention walls failed, the groups said."Communities near these coal dumps have a right to know what dangers they are facing," Earthjustice attorney Jenny Cassel said in a statement. "They need to know: If the dam holding this toxic waste breaks, which neighborhoods are going to be flooded? Which waterways? Who can they call to provide emergency response?" Asked why Duke Energy was withholding the maps, spokeswoman Erin Culbert said the company "believed we were complying with state law that protects information related to critical infrastructure." She did not specify which laws in which states were involved, or clarify how state laws that allow company information to be withheld for security reasons also covered the federal disclosure regulation.

Polluters must pick up tab for damage to planet: U.N. environment chief | Reuters: - Turning the planet’s environmental fortunes around is achievable if businesses, politicians and citizens work towards a common goal, with the biggest polluters picking up the bill, said the United Nations’ environment chief. Highlighting the dramatic progress made by China and India, Erik Solheim, executive director of UN Environment, urged governments to take a joined-up approach to going green. “The profit of destroying nature or polluting the planet is nearly always privatized, while the costs of polluting the planet or the cost of destroying ecosystems is nearly always socialized,” he told an international conference on sustainable development at New York’s Columbia University on Monday. “That cannot continue,“ he said. ”Anyone who pollutes, anyone who destroys nature must pay the cost for that destruction or that pollution.” There has been a “decoupling” of economic development and environmental degradation in many countries, but the World Health Organization now links a quarter of all deaths to pollution which contributes to cancer, heart attacks and respiratory problems, said Solheim.

General Motors to Run Ohio, Indiana Factories With 100% Wind P​ower -- General Motors just announced wind power purchase agreements with projects in Ohio and Illinois. The automaker is buying enough wind-generated electricity to power the Ohio and Indiana factories that build the Chevrolet Cruze and Silverado, and the GMC Sierra . "Technology is driving solutions for mobility and safety in our vehicles, as well as the new energy solutions that build them," said Gerald Johnson , GMNA vice president of manufacturing and labor. "This is the way we do business: offering vehicles that serve our customers' lifestyle needs while providing sustainable solutions that improve our communities." GM already has plans to soon power 100 percent of its Arlington, Texas, plant using wind, where more than 100,000 SUV's are made every year. Wind's low cost, down 66 percent since 2009, has made it an attractive option for GM as it works toward meeting its 100 percent renewable goal.  GM isn't alone in the headlines this week. Kimberly-Clark , maker of products like Kleenex and Huggies, also announced a new wind deal in recent days. The company will soon source about 33 percent of its electricity needs from wind farms in Oklahoma and Texas .  David Gardiner and Associates examined the recent trend of manufacturers committing to buying renewables in a new report entitled "The Growing Demand for Renewable Energy among Major U.S. and Global Manufacturers." The report adds that manufacturers invest in renewable energy to lower energy costs, secure stable, low-risk energy prices and demonstrate corporate leadership. GM CEO Mary Barra confirms that "pursuit of renewable energy benefits our customers and communities through cleaner air while strengthening our business through lower and more stable energy costs."

China to end sales of fossil fuel vehicles -- China, one-third of the world’s car market, is working on a timetable to end sales of fossil-fuel-based vehicles.the country’s vice minister of industry and information technology, Xin Guobin, told an industry forum in Tianjin on Saturday. That would probably see the country join Norway, France and the U.K. in switching to a wholly electric fleet within the lifetime of most current drivers. The announcement is important because the most influential players in the global auto market have always been not companies, but governments. Diesel cars make up about half of the market in the European Union and less than a percentage point in the U.S., largely because of different fuel-taxation and emissions regimes. Carburetors have been regulated out of most developed markets because fuel injection — originally a more costly technology — results in less tailpipe pollution. China’s auto industry plan released in April envisages new energy vehicles — including electric and hybrids — making up all the future sales growth in the country. With conventional cars plateauing at current levels, new-energy vehicle sales will reach 7 million annually in 2025. As many as 800,000 charging stations will be built this year alone, according to the official China Daily. Government mandates will require manufacturers to sell 8 percent of their vehicles with electric or hybrid powertrains from next year, or purchase credits to make up the difference, rising to 20 percent by 2025.

The world’s largest car market just announced an imminent end to gas and diesel cars - On Saturday, a Chinese official told the audience at an auto forum in Tianjin that the government is working on a timetable to end “production and sales of traditional energy vehicles,” i.e., gasoline and diesel cars, according to accounts from the Xinhua News Agency. Regulators have begun the “relevant research,” and the policy will be implemented “in the near future.” Details are somewhat sketchy, but it appears the government plans to shift away from the massive research and consumer subsidies of recent years to something like a cap-and-trade program for fuel economy and emissions, with automakers facing rising quotas but tradable credits providing some compliance flexibility. It’s not a concrete policy yet; we’ll have to see how it’s implemented. But for a moment, look beyond the policy to the optics. This is the world’s largest car market — responsible for around 30 percent of global passenger vehicle sales — announcing an imminent end to fossil fuel cars. That’s a big, big deal.It is just one of many remarkable developments around EVs recently. The past year has seen trumpet blast after trumpet blast heralding the arrival of an EV revolution — sooner than most analysts expected.How fast that revolution will unfold is the source of much dispute and uncertainty. And it matters a great deal to oil demand, electricity demand, greenhouse gas emissions, air pollution, and global trade flows.  In many ways, questions around EVs parallel questions around renewable energy. They have both been consistently underestimated. If they continue beating expectations, revolution is nigh. But there’s also a lot of hype, wildly conflicting projections, and plenty of risks and pitfalls ahead.

Iran, Iraq to synchronize power grids within months - Mehr News Agency: – Deputy Iranian energy minister said power grids of Iran and Iraq will be interconnected in mid-November. Iran’s Deputy Energy Minister for Electricity and Energy Affairs Houshang Falahatian made the remarks at a joint session with the Iraqi Deputy Minister of Electricity Adel Kazim Jarayan. The Iranian side pointed to status of electricity exports to the neighboring country in the summer explaining “we fortunately managed to honor commitments on supply of electricity to Iraq in hot seasons despite a record high level of domestic power consumption.” “Iran is ready to take a serious part in reconstruction of the Iraqi electricity grid once terrorists have been eliminated from the area,” highlighted the official also voicing the country’s readiness to engage seriously in three sectors including reconstruction of Iraq's production, distribution and transmission lines, with participation of the Iranian private sector. Iran’s deputy energy minister, while pointing to the need to synchronize electricity grids of the two countries, said the plan is to connect the two countries’ power grids in mid-November this year, which could play an important role in increasing the amount of electricity exchanges. In case of a request from the Iraqi government, the possibility exists to reconstruct the Iraqi distribution and transmission networks within two years. Later at the meeting, the Iraqi side said in the warm summer of present year, had it not been for electricity imports from Iran, we would have gone through a lot of difficulties.

Australia's Transition to Renewable Energy - Australia’s Prime Minister, Malcolm Turnbull rightly points to the need for reliable, affordable electricity supply. He knows that 75% of Australia’s existing coal-fired power stations have passed their design date, increasingly pollute the atmosphere and operate inefficiently. In early 2017 he argued that since Australia is the worlds largest coal exporter, they should be replaced with ultra-supercritical coal fired generators. Recognising that ultra-supercritical generators are very expensive to build, he hinted that the cost of their construction might be subsidised by the Clean Energy Finance Corporation, a government agency funded to promote clean energy rather than coal use.The Energy Minister, Josh Frydenburg went further, claiming that ultra-supercritical generators would reduce greenhouse gas emissions by as much as 40% and with carbon capture and storage (CCS) technology, carbon emissions could be reduced by about 90%. He went on to repeat his assertion that uncertainty of supply and high cost of electricity in South Australia, was the product of a too rapid transition to renewable power generation. More recently, AEMO warned that S.A. and Victoria could experience black-outs over the next 2 years and that closure of Liddell Power Station in 2022 could result in a potential shortfall of electricity supply in NSW.   The response from Turnbull was to repeat criticism of Labor State Governments for over-rapid transition to renewable energy, their failure to provide adequate storage back-up and to call for Liddell to be refurbished and kept open for 5 years beyond its intended closure date. The first comment to make on these observations is to deplore that the imperative of reducing greenhouse gas emissions should made a political football. It is high time that Australia’s major political parties got together to formulate an effective science-based national policy on curbing greenhouse gas emissions and the inevitable transition from fossil fuels to renewable energy. The need for this transition, worldwide, needs to be both rapid and orderly since it is very likely to mediate our ability to survive on this planet.

Pumped hydro storage could make Australia run on renewable energy alone within 20 years - Australia has the capacity to store up to 1,000 times more renewable energy than it could ever conceivably need, according to an analysis by researchers at the Australian National University (ANU). ANU engineering professor Andrew Blakers has conducted a study looking into pumped hydro sites and has concluded that there are at least 22,000 suitable locations nationwide. Professor Blakers said if storage was built at just a tiny fraction of those places, Australia could transition to 100 per cent renewable power within two decades. “No matter where you are in Australia, you will find a good pumped hydro site not very far away from where you, or your wind or your solar farm is located,” he said.ANU engineering research fellow Matthew Stocks said a typical pumped hydro facility could deliver maximum power for between five hours and one full day.The power could be quickly dispatched to the grid, when needed. "It can go from zero to full power in about one minute," Dr Stocks said.

Australia’s biggest utility hails renewables-plus-storage as economically viable successor to coal - Australia’s biggest utility AGL, which has committed to phasing out coal by 2050, has said it is likely to replace the capacity provided by one ageing power station with batteries, peaking plants, demand response and pumped hydro. In a recent blog, AGL CEO Andy Vesey outlined that in his view, with 75% of Australia’s thermal generation plants already being in use “past their use-by-date”, investors in the energy sector were clear that the cheapest sources of electricity in Australia will be renewables backed with energy storage. This morning, AGL and Vesey put out a release outlining that following meetings with the country’s government including the Prime Minister Malcom Turnbull, AGL remains intent on shutting down Liddell, a coal-fired power station in its service area, by 2022. Originally, the government had asked AGL to consider continuing to operate Liddell for five years beyond that date, or to consider selling the power station off. However in a statement to the Australian Stock Exchange (ASX) last week, AGL said neither option had been adopted by its board.

Protesters set to rally against Australia's biggest coal project | Reuters: (Reuters) - Environmental activists are due to start a week of protests on Sunday against a major coal mining project they say will damage Australia’s Great Barrier Reef and contribute to global warming. The A$16.5 billion ($13.20 billion) project has been delayed for more than five years by court challenges from environmentalists and indigenous groups concerned about reef damage, climate change, and the impact on native land and water supply. The challenges failed and a workers’ camp opened in August to begin building the project’s $3.2 billion first stage. The “Frontline Action on Coal” and the “Reef Defenders” groups are to start their protests at Bowen, in the Whitsunday region of Queensland where the reef is situated. Paul Jukes, a Whitsunday farmer and tourism operator, told Reuters by telephone that the demonstrations would start with a march but could extend to direct action such as activists locking themselves to equipment to prevent it from being moved.The project is located in the remote Galilee Basin, a 247,000 square-kilometer (95,000 square mile) expanse in the central outback that some believe has the potential to become Australia’s largest coal-producing region. Adani has said the project would create 10,000 direct and indirect jobs. Coal from the mine would be exported to India. The mine is located 400 km (250 miles) from a Pacific Ocean shipping terminal. Adani is seeking a A$900 million ($720 million) concessional government loan to help build a rail line linked to a port. 

Investment in coal will fetch Nigeria billions in revenue - I wrote last month about a landmark court decision in U.S. energy. Where judges threatened to shut down the $3.5 billion Sabal Trail pipeline in Florida — because regulators hadn’t assessed climate change effects from the downstream burning of the pipeline’s natural gas for power.At the time, I warned this would trigger more lawsuits — essentially opening up a new and powerful tool for environmental groups to oppose resource development. And two cases this past week show that’s exactly what’s happening. The first came in New York State. Where state regulators attempted to use last month’s Sabal Trail ruling as justification to shut down another pipeline project — a 7.8 mile natural gas line being proposed by Millennium Pipeline. New York’s Department of Environmental Conservation cited the ruling in denying key permits for the pipeline. With the project then going back to the Federal Energy Regulatory Commission (FERC) for review.  FERC was able to salvage the project Friday. But only because of a procedural technicality — with the regulator pointing out that New York’s regulators were required to file any objections to the pipeline within a year of receiving the November 2015 application from Millennium Pipeline.That came in a federal U.S. appeals court Friday. Where judges upheld a lawsuit from environmentalists — saying that any leasing of coal projects on federal land must consider climate effects from the eventual burning of that coal. Coal mining opponents have long been saying that environmental impact assessments of new coal mining projects should consider downstream climate impacts. With regulators up until now rejecting such arguments — saying that coal-fired plants will burn coal from somewhere, meaning that stopping one particular mine won’t solve climate issues. But the new appeals court ruling said that national regulator Bureau of Land Management (BLM) must indeed consider downstream effects when granting new coal licenses. With judges directing the agency to reconsider permitting for four already-granted leases in Wyoming.

Coal's rally isn't all about China, it's also quality, supply: Russell (Reuters) - It is increasingly popular to write obituaries for coal, with analysts, market watchers, investors and utility bosses leaping on the bandwagon, declaiming that the days of the polluting fuel are numbered. Certainly the long-term outlook for coal is becoming less certain as more countries commit to ending, or severely curtailing, use of the fuel. But while the doomsayers may eventually be proven correct, coal is enjoying a stellar year, particularly in Asia, the main demand centre. The price of benchmark prices for thermal coal at Australia’s Newcastle Port slipped toward the end of last week, but still ended above $100 a tonne on Sept. 15. The contract rose 45 percent from the closing low of $71.30 a tonne on May 16 to a peak of $103.50 on Sept. 12, providing a bonanza for miners in Australia and Indonesia, the two largest exporters of thermal coal used in power stations. Metallurgical coal, used to make steel, hasn’t had quite as good a year as thermal, but is still holding above $200 a tonne. Singapore Exchange contracts, priced against the Steel Index assessment of Australian cargoes, ended at $207 a tonne on Sept. 15, down from a cyclone-induced peak of $285 in early April, but largely steady from the $226.50 a tonne they fetched at the start of this year. While coking coal has been affected by weather-related disruptions in Australia, the price of thermal coal has mostly been driven by Chinese import demand. Chinese seaborne imports of both types of coal were 157 million tonnes in the first eight months of 2017, according to vessel-tracking and port data compiled by Thomson Reuters Supply Chain and Commodity Forecasts. This was up 12.4 percent on the same period in 2016, with China importing an additional 17.3 million tonnes from the seaborne market. 

Hinkley nuclear power is being priced out by renewables - Hinkley Point C nuclear power station was conceived in the days when offshore wind cost £150 per megawatt hour and a few misguided souls, some of them government ministers, thought a barrel of oil was heading towards $200.Successive governments swallowed the line that Hinkley represented a plausible answer to the UK’s threefold energy conundrum – keeping the lights on, reducing carbon emissions and producing the juice at affordable prices for consumers and business. Hinkley still scores on reliability and low carbon (if one ignores the effect of spoiling the Somerset countryside with so much concrete), but the extent to which its costs are obscene is now plainer than ever. In Monday’s capacity auction, two big offshore wind farms came in at £57.50 per megawatt hour and a third at £74.75. These “strike prices” – a guaranteed price for the electricity generated – are expressed in 2012 figures, as is Hinkley’s £92.50 so the comparison is fair. As for the argument that we must pay up for reliable baseload supplies, there ought to be limits to how far it can be pushed. A nuclear premium of some level might be justified, but Hinkley lives in a financial world of its own, even before battery technology (possibly) shifts the economics further in favour of renewables.

The real strike price of offshore wind | Energy Matters -- “Hinkley still scores on reliability and low carbon ….. but the extent to which its costs are obscene is now plainer than ever. In Monday’s capacity auction, two big offshore wind farms came in at £57.50 per megawatt hour and a third at £74.75. These “strike prices” …..  are expressed in 2012 figures, as is Hinkley’s £92.50 so the comparison is fair. As for the argument that we must pay up for reliable baseload supplies, there ought to be limits to how far it can be pushed. A nuclear premium of some level might be justified, but Hinkley lives in a financial world of its own, even before battery technology (possibly) shifts the economics further in favour of renewables …..” Thus spake the Guardian in a recent article entitled Hinkley nuclear power is being priced out by renewables. What the Guardian says is, of course, nonsense. Comparing non-dispatchable wind directly with dispatchable baseload nuclear is not in the least “fair”. Barring Acts of God baseload nuclear is there all the time; wind is there only when the wind blows. We can level the playing field only by comparing baseload nuclear generation with baseload wind generation, and the only way of converting wind into baseload is to store the surpluses generated when the wind is blowing for re-use when it isn’t. To compare offshore wind strike prices directly with nuclear strike prices we therefore have to factor in the storage costs necessary to convert the wind into baseload, and this post shows what happens to wind strike prices when we do this using the “battery technology” favored by the Guardian. It finds that battery technology does not “(shift) the economics further in favor of renewables”. It prices wind totally out of the market instead.

Saudi Arabia plans to launch nuclear power tender next month - Saudi Arabia is expected to launch a tender process for its first nuclear reactors as early as next month and will reach out to potential vendors from countries including South Korea, France and China, industry sources said. The world’s top oil exporter wants to start construction next year on two plants with a total capacity of up to 2.8 gigawatts, three industry sources said, as it follows Gulf neighbor the United Arab Emirates in seeking atomic energy. This will make it the second country in the Arab world to tap nuclear power as a way to diversify its energy supply for its 32 million population. The UAE’s first plant is expected to come online next year after delays. “Competition will be fierce,” an industry source said, adding Saudi Arabia was expected to send a Request for Information (RFI) to suppliers in October, marking the official start of the tender process following feasibility studies.

Poland planning nuclear tender early 2018 - Poland’s energy ministry said Friday it is scheduling a tender to select the technology to build the country’s first nuclear reactors in early 2018 if the scheme gets the government go ahead. Atomic regulations allow only tested technologies of Generation III/III+ reactors to be used,” the ministry wrote in response to a lawmaker’s question. “The Energy Ministry estimates that the technology selection tender will be announced in early 2018, at the latest,” the ministry added. Poland’s energy minister Krzysztof Tchorzewski is a supporter of nuclear power as a way to reduce the country’s average CO2 emissions. At the Krynica Economic Forum earlier this month he said he believes Poland needs to construct 4.5 GW of nuclear capacity in three units by 2040-43.

S.Africa could restart nuclear tender process soon - South Africa could restart a procurement process for its nuclear expansion project as soon as next month but the government still has to determine the exact timing, the chairman of South Africa’s state nuclear agency Necsa said on Friday. South Africa is planning to build several new nuclear reactors with a combined capacity of 9,600 megawatts, which could be one of the world’s biggest nuclear deals in decades. The plans aim to help resolve the country’s chronic power shortages. The plans were disrupted this year when South Africa’s High Court ruled that a nuclear cooperation pact with Russia was unlawful, after which the government started to draw up new pacts with countries with nuclear expertise. “The procurement process could restart as soon as next month,” Kemm said on the sidelines of the World Nuclear Association conference in London. He said South Africa’s state utility Eskom and Necsa were ready to proceed. “All that needs to happen is for the politicians to press the restart button,” he said.

U.S. nuclear reactors face uphill challenge, despite low emissions (Reuters) - The U.S. nuclear power industry is facing an uphill battle to hang onto its share of the country’s electricity production, with some projecting a worst-case scenario where half of the nation’s 99 nuclear reactors could shut over the next couple of decades. Nuclear power looked to be on the verge of a renaissance about a decade ago. But a surge in domestic natural gas production, billions of dollars in cost overruns on new projects, Japan’s Fukushima accident in 2011, and multiple plant closures have the industry on its heels again. The U.S. Department of Energy (DOE) expects nuclear’s percentage of the power mix to drop to 11 percent by 2050 from the current 20 percent, and many reactors to close. A DOE study in August pointed to increased natural gas production as the biggest factor hampering competitiveness in nuclear power. “Up to half of the currently operational nuclear capacity could be at risk of early retirement in the next decade or two due to low power prices and rising costs,” said Dana Lazarus, senior analyst in North American power at PIRA Energy Group, a unit of S&P Global Platts. Nuclear providers believe they should be paid more for electricity they sell because the power is cleaner than natural gas and coal and more reliable than wind and solar. But gas and renewable producers oppose higher payments for nuclear, which they see as an expensive subsidy to an uncompetitive industry. 

Nuclear Experts Head to China to Test Experimental Reactors - China is becoming the testing ground for a new breed of nuclear power stations designed to be safer and cheaper, as scientists from the U.S. and other Western nations find it difficult to raise enough money to build experimental plants at home. China National Nuclear Power Co. this month announced a joint venture to build and operate a “traveling wave reactor” in Hebei province, designed by Bellevue, Washington-based TerraPower LLC, whose chairman is Microsoft Corp. founder Bill Gates. The development follows Canada’s SNC-Lavalin, which has agreed to build a new recycled-fuel plant with China National Nuclear Corp. and Shanghai Electric Group, and Oak Ridge National Laboratory, which is working with the Shanghai Institute of Applied Physics on a salt-cooled system. “China is where is the demand exists and where willing partners exist for this kind of plant,” said TerraPower President Chris Levesque, whose company has been working on the traveling-wave technology for a decade. “It is really encouraging when your partners are announcing a site.”While most advanced economies are slowly pivoting to energy sources like solar and wind, China’s soaring energy demand means it’s spending billions on new power plants across the energy spectrum, from coal and natural gas, to renewables and nuclear. China has the world’s most aggressive reactor construction plan, with the goal of boosting its nuclear power capacity by about 70 percent to 58 gigawatts by 2020. “The outlook for nuclear power is brighter there than anywhere else in the world,” said M. V. Ramana, a professor at the Liu Institute for Global Issues at the University of British Columbia. “It is not so difficult for a company developing a nuclear reactor design to find a partner.” The systems proposed belong to the so-called fourth generation of reactors. The current generation under construction include enhanced safety features following the Fukushima disaster in Japan in 2011, but still typically use traditional fuel rods, cooled by water under pressure. Both Areva SA and Westinghouse Electric Co. are slated to turn on their current-generation nuclear reactors in the next year in China -- well ahead of any other nation, despite delays.

TEPCO gets OK to restart Niigata reactors -- The nation’s nuclear watchdog gave conditional approval Sept. 13 to Tokyo Electric Power Co.’s application to resume operations of its Kashiwazaki-Kariwa nuclear plant. The two reactors at the plant in Niigata Prefecture–the No. 6 and No. 7 units–are the first boiling-water reactors in Japan to clear the regulations. The NRA already accepts that TEPCO has the technological know-how to operate the Kashiwazaki-Kariwa plant, one of the world’s largest. But it had harbored doubts about the company’s fitness to operate a nuclear plant, given its tendency to put its balance sheet ahead of safety precautions. The NRA ordered TEPCO to provide in the legally required safety code a detailed explanation of procedures it will take to ensure that the Kashiwazaki-Kariwa plant is operated safely. That way, the watchdog body aims to make the utility legally accountable if problems arise.

TEPCO again ordered to pay damages over nuclear disaster —— A Japanese court ordered Tokyo Electric Power Company Holdings Inc (TEPCO) on Friday to pay damages over the nuclear disaster at its Fukushima Daiichi nuclear power plant following a deadly 2011 earthquake and tsunami, but dismissed claims against the state. The Chiba District Court ruling follows a Maebashi District Court decision in March that found negligence on the part of both TEPCO and the government played a part in the worst nuclear catastrophe since Chernobyl and ordered them to pay damages. Friday's ruling stemmed from a lawsuit filed by 45 people who were forced to flee Fukushima Prefecture to Chiba Prefecture near Tokyo as reactors that lost cooling functions caused meltdowns and spewed massive amounts of radioactive materials into the air. The Chiba court awarded a total of 376 million yen to 42 of them, including all four who voluntarily evacuated. In the suit filed in March 2013, the plaintiffs were collectively seeking around 2.8 billion yen in damages from the government and plant operator. The focal point of the Chiba case was whether the government and Tepco were able to foresee the huge tsunami that hit the seaside plant on March 11, 2011, and take preventive measures beforehand, with conflicting claims made by the parties regarding the government's long-term earthquake assessment, which was made public in 2002. The assessment, made by the government's earthquake research promotion unit, predicted a 20 percent chance of a magnitude-8-level tsunami-triggering earthquake occurring along the Japan Trench in the Pacific Ocean within 30 years, including the area off Fukushima. Based on the assessment, the plaintiffs argued that, with the plant standing on ground roughly 10 meters above sea level, a tsunami higher than the ground striking the plant could have been predicted. They then claimed that the disaster was therefore preventable if emergency power generation equipment had been placed on higher ground, and that the government should have made TEPCO take such measures by exercising its regulatory powers. 

North Korea's Nuclear Tests Could Trigger "Supervolcano" Eruption - After North Korea’s latest nuclear test, scientists are worried that more underground explosions in the isolated country’s rocky north could set the stage for a deadly volcanic eruption not unlike the one that NASA fears could be brewing in the Yellowstone caldera. Following the North’s sixth nuclear test, which produced a blast that, by some estimates, was as powerful as 300 kilo hertz, Chinese authorities have stepped up radiation monitoring and even closed part of their border with North Korea as fallout fears have intensified. And now, as Newsweek reports, China has limited access to a nature reserve on its border with North Korea after a mysterious series of seismic shakes at the rogue nation's nuclear test site were detected less than 10 minutes after it conducted its latest test, which also triggered a sizable tremor. The severity of the tremors prompted Beijing to close the site over fears that underground detonations by the North Koreans at a facility near Punggye-ri could lead to rockslides, or worse, trigger an eruption of the active "super volcano" Mount Paektu, according to Disclose.tv.

A nuclear test over the Pacific? Logical, terrifying (Reuters) - Detonating a nuclear-tipped missile over the Pacific Ocean would be a logical final step by North Korea to prove the success of its weapons program but would be extremely provocative and carry huge risks, arms control experts said on Friday. North Korean Foreign Minister Ri Yong Ho suggested leader Kim Jong Un was considering testing “an unprecedented scale hydrogen bomb” over the Pacific in response to U.S. President Donald Trump’s threat at the United Nations to “totally destroy” the country. “It may mean North Korea will fire a warhead-tipped (intermediate range) Hwasong-12 or Hwasong-14 intercontinental ballistic missile and blow it up a few hundred kilometers above the Pacific Ocean,” said Yang Uk, a senior researcher at the Korea Defence and Security Forum in Seoul. “They may be bluffing, but there is a need for them to test their combined missile-bomb capability. They could have already prepared the plan and are now trying to use Trump’s remarks as an excuse to make it happen,” said Yang. Such an atmospheric test would be the first globally since China detonated a device in 1980, according to the International Atomic Energy Agency. Tests of nuclear-tipped ballistic missiles are rarer still. The United States’ only test of an operational ballistic missile with a live warhead was fired from submarine far out in the Pacific Ocean in 1962. North Korea’s six nuclear tests to date have all been underground, the most recent earlier this month by far its largest. “We have to assume they *could* do it, but it is exceedingly provocative,” said Vipin Narang, an associate professor of political science at Massachusetts Institute of Technology. “To put a live nuclear warhead on a missile that’s only been tested a handful of times, overflying potentially populated centers. If it...doesn’t go exactly as planned....it could be a world changing event.” 

What Would an H-Bomb Do to the Pacific Ocean? - The latest fiery exchange between the United States and North Korea has produced a new kind of threat. On Tuesday, during his speech at the United Nations, President Trump said his government would “totally destroy North Korea” if necessary to defend the United States or its allies. On Friday, Kim Jong Un responded, saying North Korea “will consider with seriousness exercising of a corresponding, highest level of hard-line countermeasure in history.” The North Korean leader didn’t elaborate on the nature of this countermeasure, but his foreign minister provided a hint: North Korea might test a hydrogen bomb in the Pacific Ocean.  Conducting a hydrogen-bomb test in the ocean could mean putting a nuclear warhead on top of a ballistic missile and launching them together toward the sea. If North Korea followed through, the test would be the first detonation of a nuclear weapon in the atmosphere in nearly 40 years. It would lead to—aside from untold geopolitical consequences—severe environmental impacts. Hydrogen bombs are far more powerful than atomic bombs, capable of producing many times more explosive energy. If an H-bomb hits the Pacific, it will detonate with a blinding flash and produce the signature mushroom cloud. The immediate effects likely would depend on the height of the detonation above the water. The initial blast could kill most of the life in the strike zone—scores of fish and other marine life—instantly.  The explosion would send radioactive dust and ash flying through the air and into the water. Wind could carry the dangerous particles over hundreds of miles. The smoke from the blast site could block out sunlight and hinder life forms at sea that depend on photosynthesis to survive. The exposure to radiation could cause severe health problems for nearby marine life. Radioactivity is known to damage cells in humans, animals, and plants by causing changes in their genes. The changes could lead to crippling mutations in future generations. The eggs and larvae of marine organisms are especially sensitive to radiation, according to experts. Affected animals could pass the exposure up the food chain. The test could also have damaging and long-lasting effects on humans and other wildlife if the radioactive fallout reaches land. The particles could contaminate air, soil, and water supply. More than 60 years after the United States tested a series of atomic bombs near Bikini Atoll in the Marshall Islands, the island remains “unlivable,” according to a report from The Guardian in 2014. Residents relocated before the tests returned in the 1970s to find high levels of radiation in foods grown near the nuclear test site and were forced to leave again.

 Report Highlights Fracking's Threat to Ohio's National Forest -– Ohio's Wayne National Forest is among the country's public lands most threatened by fossil fuel interests, according to a new report. "Too Wild to Drill," released Tuesday by The Wilderness Society examines 15 unique places across the United States that researchers say are at high risk of drilling and mining. Nathan Johnson, the public lands director for the Ohio Environmental Council, says folks trying to enjoy the natural beauty of the forest's 250,000 acres don't want to breathe in toxic air pollution or hear the constant noise of trucking and compressor stations. "If you've got a family that's playing or fishing in a stream there, the last thing you want folks to worry about is chemicals being in the water or even chemicals in the fish their son or daughter just caught in the stream," he says. "Those are all really big concerns we don't want to see in the Wayne." The Ohio Environmental Council and other groups are legally challenging the Bureau of Land Management's recent lease of nearly two thousand acres of the Wayne National Forest, as well as an oil and gas leasing plan for 40,000 acres of the land. The BLM contends an environmental assessment found the leasing will not significantly affect the quality of the environment in the area. Supporters of oil and gas drilling contend it creates economic opportunities. But Johnson says the risks to Ohio's only national forest are just too great. He points to the 2014 Monroe County well pad fire that occurred near the Wayne National Forest. "Fortunately no one died," he adds. "Twenty-five families had to be evacuated, 70,000 fish were killed in a stream. So these threats are not just purely idle or speculative - they're real and they happen and it's something we really have got to be careful about and aware of." The report's release comes as federal officials review public land policies, and a 180-day review of regulations that could burden fossil fuel development ends at the end of September. 

Ohio increases fines to $2.3M against pipeline developer | Fox Business: – Ohio's environmental regulators have more than doubled the proposed fines against a company building a natural gas pipeline from West Virginia to Michigan, saying Wednesday the two sides are at an impasse. Continue Reading Below The fines now stand at $2.3 million and stem from what the Ohio Environmental Protection Agency says are numerous water and air pollution violations during construction of the $4.2 billion Rover Pipeline. The twin pipelines are being built across Ohio to carry natural gas from Appalachian shale fields to Canada and states in the Midwest and the South. Dallas-based developer Energy Transfer Partners, which also was behind the Dakota Access oil pipeline, has resisted attempts at resolving the fines, said Craig Butler, director of Ohio's Environmental Protection Agency. Butler said he is now asking the state's attorney general to get involved. Energy Transfer Partners said it will continue to work with the Federal Energy Regulatory Commission to meet its requirements. The federal commission that oversees gas pipelines this week gave the company the approval to restart drilling operations. New drilling on unfinished sections had been halted after 2 million gallons (7.6 million liters) of drilling mud seeped into a wetland in the spring. Energy Transfer Partners spokeswoman Alexis Daniel said the project now is expected to be completed and operating by the end of March. The head of the Ohio EPA said the pipeline company doesn't think the state has authority to impose regulations because the Federal Energy Regulatory Commission already gave the company approval on the project.

Ohio EPA Hikes Penalties Against Rover Pipeline To $2.3 Million -- The Ohio EPA on Wednesday turned over of $2.3 million in civil penalties against the owners of the Rover pipeline enforcement to the Ohio Attorney General’s office. Ohio EPA Director Craig Butler says he had no choice but to bring -in the state attorney general’s office to force a settlement with Energy Transfer Partners, and other owners of the Rover pipeline over civil penalties. He says Rover has logged dozens of environmental violations, including open burning, a massive spill in a sensitive wetland and dumping drilling mud mixed with diesel fuel in a quarry near where Canton draws its drinking water. At an event Wednesday on the banks of the Cuyahoga River, Butler said the fines against Rover kept snowballing. “As time goes by it went from $400,000 to $900,000 and now we believe it’s justified to ask for a $2.3 million penalty.” Butler says Rover’s owners have refused to pay any penalties but that clean-up of contaminated sites has gone forward. 

Ohio agency wants troubled Rover Pipeline to pay $2.3 million in fines - The Ohio Environmental Protection Agency is once again squaring off with Rover Pipeline LLC officials. On Wednesday, the state agency asked the Ohio attorney general’s office to hold pipeline officials financially responsible for $2.3 million in fines related to numerous environmental violations which have occurred during the $4.2 billion underground natural gas pipeline’s construction. Rover’s parent company is Dallas-based Energy Transfer Partners. An analysis last month found the 710-mile-long Rover project has already piled up 104 “noncompliance incidents” so far — more than any other interstate natural gas pipeline in the past two years. Along its Ohio stretch, the pipeline razed a historic house, leaked 2 million gallons of drilling sludge into protected wetlands and dumped contaminated slurry in quarries near water wells used by the Canton Water Department and Aqua Ohio. In May, the Federal Energy Regulatory Commission ordered a halt to new drilling activity along the troubled project.   Since then, the company has done its part to clean up the releases, install a groundwater monitoring network and develop plans to remediate impacted wetlands, Ohio EPA Director Craig Butler told reporters Wednesday. But the company refuses to pay the millions in civil penalties ordered by the state, he said. “Negotiations just in general with Rover have been quite difficult ... We’ve reached an impasse and have to ask for assistance,” he said. “We believe it’s fair that they owe the state of Ohio in compensation.” Environmental groups applauded the agency’s move to refer the case to state Attorney General Mike DeWine. “Simply put, when a mess is made, a penalty is appropriate. If the Rover Pipeline project followed the rules and respected Ohioans and our natural resources, these things wouldn’t happen,” said Heather Taylor-Miesle, executive director of the Ohio Environmental Council.

Far away from any witnesses, my small town is being poisoned by fracking waste  - My south-eastern Ohio town in the Appalachian foothills is a small, rural place where the demolition derby at the county fair is a hot ticket, Walmart is the biggest store, and people in the even smaller villages surrounding the county seat must often drive for 30 minutes to grocery shop. We hold the unfortunate distinction of being the poorest county in the state: an area that is both stunning – rolling hills, rocky cliffs, pastures and ravines – and inaccessible, far from industry.  It’s here that fracking companies dump their waste. The Hazel Ginsburg well, an injection well built in the hillside decades ago, was meant to deposit saline and sand underground into porous rock. For the last few years, however, the well has held waste from out-of-state fracking operations done in Pennsylvania, West Virginia and other states.  A forgotten byproduct of fracking is the waste. What goes into the ground must come out: a sludge of toxic chemicals and undrinkable water, which trucks ship across the country. Far from the drill pads, far from the cities that profit from fracking, far from any city at all, the leftover wastewater is injected into the ground – my county’s forgotten ground. Some streams in the woods run red from the acid leaking from abandoned shafts. My step-grandmother, the daughter of a Kentucky miner, used to tell me stories of washing her clothes in red water, downstream from mines.  But the Hazel Ginsburg well has a long history of violations, so many that the Ohio department of natural resources (ODNR) ordered it shut. It was not. It’s a pit well, which looks like an old swimming pool, covered by a tarp. No sign indicates the presence of chemicals, just a “no trespassing” sign on a gate across a gravel driveway, near a wooden shack where a security guard sits. Allegedly, the guard will snap your picture if you stop or turn your car around. The well is located in a residential area, with houses – some with swing sets – just down the road.

 Toxic town: West Virginia community where cancer rates are FOUR TIMES the national average and residents point to chemical dumps as the cause as they attend 'one funeral after another'. Now nearby fracking fuels fears of MORE contamination

  • Minden, West Virginia is a riverside town which once thrived on coal mining. Residents have noticed elevated sickness rates for at least the past 30 years
  • One 62-year-old grandmother, Susie Worley-Jenkins, has been diagnosed with cancer four times; her husband survived leukemia and multiple skin cancer diagnoses; and her best friend died of a brain tumor
  • Worley-Jenkins and other residents have banded together to form a grassroots effort with the hope of pressuring authorities to identify and stop the cause
  • Dr Hassan Amjad dedicated his life to documenting the cancer rates and calling for justice before his death from a sudden illness in August
  • The Environmental Protection Agency found now-defunct company Shaffer Equipment dumped electrical equipment laden with toxic chemicals on the coal company’s mine site, which is now abandoned, in the center of Minden
  • Minden received Superfund money, designated for toxic cleanup sites, in the 1980s but residents fear chemicals remain and fracking could be further contaminating the area
  • One state statistician wrote, in an email seen by DailyMail.com, that the 'much higher cancer death rate' in Minden than the surrounding county was 'concerning,' given the tiny population rate
  • Authorities have repeatedly insisted that water levels are safe but the EPA conducted testing again this summer, though results for Minden have not been released
  • The national average cancer mortality rate is 171 per 100,000 - while figures have placed Minden's rates at 642.1 per 100,000 and Dr Amjad found rates in previous years as high as 2,092 per 100,000
  • The real rates in Minden could be even higher as a result of flawed reporting and residents moving, he said

Angry officials ask: Can Enbridge be trusted on Mackinac Straits pipeline safety? - Damaged pipeline protection — and damaged trust — filled the agenda at the Michigan Pipeline Safety Advisory Board meeting in Lansing on Monday as concerns grow about the condition of two oil pipelines running under the Straits of Mackinac.State officials flashed anger with Canadian oil transport giant Enbridge, after the company disclosed late last month that areas of missing protective coating — bare metal — exist on their 64-year-old oil and gas pipelines that lie underwater in the straits, which connect Lake Michigan and Lake Huron.  Particularly drawing ire were original Enbridge public statements that the areas missing coating were "Band-Aid sized." The company has since disclosed to the state that seven of the eight affected areas are 7 inches in diameter or more, including some more than a foot in diameter."Frankly, I think we really need to know that what Enbridge is telling us is the truth, and that it is accurate,"  . "Because, we were not really told the truth, nor was it really accurate — especially with they characterization about Band-Aid-sized impacts."   State officials also expressed concern that at least one of the areas of damaged, missing protective coating on the pipelines appears to have been caused during the installation of a support anchor on the pipe, yet was not immediately disclosed or repaired. Enbridge currently has a permit before the state DEQ to install 22 additional anchor supports on Line 5, to address areas where the span between anchor supports now exceeds 75 feet, the maximum allowable distance in Enbridge's 1953 easement with the state of Michigan allowing for the Straits pipeline."With how the damage to the coating on the pipeline was reported, and that the outer coating damage apparently occurred during preventative measures, causes me not only great concern, but honestly, I’m angered and actually annoyed at how this has transpired, from inspection, identification, and notification regarding the affected areas," said State Police Capt. Chris Kelenske, a pipeline safety board member and the deputy state director of emergency management and homeland security. "The question I have is, how is it the damaged areas were not identified earlier, nor immediately reported to the state? Looking at the pictures from that report, it’s obvious that there are gaps in this outer coating."

Regional gas pipeline projects move forward  - The installment of a new natural gas compressor station in the Grayson area is almost complete. The station, located on Beckwith Branch Road beside I-64, is part of TransCanada Corporation’s Rayne XPress project and is one of many that are currently ongoing. The facility will help the transportation process of natural gas that serves Kentucky markets as well as markets further south, according to Scott Castleman, Manager of U.S. Gas Communications. The Rayne XPress is a $400 million project with a purpose of adding new compressor stations on TransCanada’s existing Columbia Gulf System. Another compressor station being constructed in Means is part of the project as well.  Castleman said the project was approved by the Federal Energy Regulatory Commission (FERC) in January and anticipates construction will be completed in November. He described the appearance of the station saying it somewhat appears like a “green barn.” “Typically it’s something that once it’s running in service people are not going to notice or think much about,” he said. In terms of new employment opportunities with the station, Castleman said there are usually two to four employees who will be needed to be onsite during work hours, adding a lot of the positions have already been filled.  The Gulf XPress project is another project that is currently ongoing in the Tri-State region which includes the installation of seven compressor stations. Three of the stations are in Morehead, Paint Lick and Goodluck. Castleman said there has been some misconceptions about the construction work with the projects, explaining there is no actual pipeline work going on in Kentucky. There is, however, pipeline work being done in West Virginia under the Leach XPress and Mountaineer XPress projects. Castleman explained the Leach XPress project starts in Marshall County at the Pennsylvania and West Virginia border and travels 160 miles through southeastern Ohio, delivering gas to the existing Ceredo compressor station.   The Mountaineer XPress project starts in the same area in Marshall County and travels about 165 miles down through the state, delivering gas to the existing Ceredo compressor station as well.

Controversial Atlantic Sunrise pipeline gets green light from feds to start digging - Three years after it was proposed, the controversial Atlantic Sunrise pipeline on Friday was given federal approval to begin moving dirt. The Federal Energy Regulatory Commission issued its notice to proceed for the entire 197-mile, $3 billion natural gas project, including the laying of 37 miles of 42-inch pipe in Lancaster County. Williams Partners spokesman Christopher Stockton said work will likely begin on the pipeline the week of Sept. 25 because the contractor needs time to mobilize equipment and begin site preparation. In Lancaster County specifically, he said, the majority of work will not begin for another month or so. That’s because more heavily wooded counties north of Lancaster County need considerably more tree clearing on rights of way. “The first activity people will see is site grading and the establishment of erosion control devices,” Stockton said. A religious freedom lawsuit against pipeline owner Transcontinental Gas Pipe Line Co. and FERC in federal court has been filed by a Catholic order of nuns near Columbia. But Stockton said the lawsuit by the Adorers of the Blood of Christ “does not affect our right to start pipeline construction as scheduled.” 

Nuns build chapel — and file lawsuit — to block a natural gas pipeline - A convent of elderly nuns supported by a group of local activists are all that stand in the way of a billion dollar pipeline company drilling through almost 200 miles of Pennsylvania countryside. The Adorers of the Blood of Christ own a plot of land in Lancaster County, Pennsylvania, that includes a nursing home, their convent and a field of corn plowed by a local farmer. But now the sisters have erected an outdoor chapel among the cornstalks: Wood pews and an arbor, adjacent to a city park and a subdivision. The chapel and a corresponding religious-freedom lawsuit are intended to stop the natural gas-pumping Atlantic Sunrise pipeline, an addition to Williams Partners' Transco pipeline system currently under construction. Play Facebook Twitter Embed Nuns and Activists Join Together to Protect Chapel in Path of Pipeline 5:33 autoplay autoplay Copy this code to your website or blog “It’s not a traditional chapel, but it’s a marker. It’s a place that says, ‘This is sacred,’ as was the mountaintop with Moses and the burning bush,” explained Sister Sara Dwyer, noting that 300 people attended the chapel’s dedication last month. “It’s just a place for us to be able to come, to be calm, to be focused, to be intentional about our resistance and our willingness to go very, very public with that resistance in a prayerful, nonviolent way,” she added. And it’s also going to be key in the local resistance to the pipeline, although the elderly nuns will likely attempt to maintain the property through stayed and dutiful prayer.

Construction begins on Atlantic Sunrise Pipeline - Williams Partners has announced construction is officially underway on its multi-billion dollar Atlantic Sunrise Pipeline, which is being built to connect Marcellus Shale gas in northeastern Pennsylvania to markets along the eastern seaboard.“We are committed to installing this infrastructure in a safe, environmentally responsible manner and in full compliance with rigorous state and federal environmental permits and standards,” Micheal Dunn, Williams’ executive vice president and chief operating officer said in a press release. “Our construction personnel are experienced, highly-qualified professionals who have undergone extensive training to ensure that this important project is installed safely and responsibly.”The company broke ground Friday on two new natural gas compressor stations in Orange Township, Columbia and Clinton Township ,Wyoming county. Work on the pipeline itself is expected to begin September 25. Once completed, the line will run underground, through 10 Pennsylvania counties: Columbia, Lancaster, Lebanon, Luzerne, Northumberland, Schuylkill, Susquehanna, Wyoming, Clinton and Lycoming.The project has been met with considerable public push-back, especially in Lancaster County. Hundreds of people have pledged to engage in civil disobedience in an effort to block the project.A Williams spokesman says some preliminary work is beginning in the Lancaster area, but most of it will get underway in mid-to-late October.“We are always disappointed when the regulatory agencies give another approval or permit for the industry to violate the rights of the people,” says Malinda Clatterbuck of the protest group, Lancaster Against Pipelines. “That is how we see this decision, as an outright violation of our communities’ constitutional rights to clean air and clean water, and a healthy and sustainable future.”  The pipeline is part of a broader network of controversial new natural gas infrastructural projects under construction throughout the Northeast to connect natural gas production in the Appalachian Basin to new markets within the U.S. and abroad.

Conflicting decisions on pipelines frustrate industry, landowners - In March 2016, workers for one of the nation’s largest natural gas pipeline companies cut down a large swath of maple trees in Susquehanna County–a rural patch of northeastern Pennsylvania. A video shot by an activist shows the trees crashing down as chainsaws buzz.Cathy Holleran was powerless to stop it. At the time, she was tapping the trees for her family’s maple syrup business, but the pipeline company condemned her land using the power of eminent domain. Driving around a year-and-a half later, she’s still in disbelief. A court order had prevented her from interfering, and law enforcement officers came to protect the pipeline workers.By her count, she lost more than 550 maples, “I went through with my camera and took pictures from every angle and counted them by hand to make sure I was accurate.”She says her family’s maple syrup business has been cut in half. But the real shame of it all, Holleran adds, is this may all have been for nothing.The Constitution Pipeline was supposed to emanate from northeastern Pennsylvania, and run 121 miles through New York State. Federal regulators gave their blessing to the project. So did Pennsylvania regulators. But New York State (whose border is about 20 miles from Holleran’s land) refused to grant a necessary water permit.The pipeline company, Williams, sued, but a federal court recently sided with New York. Holleran says she’d warned the company of this possibility.“All along we kept saying, ‘You might not get through New York. You might not get your permits. You’re gonna come through here and cut our land?’”Williams spokesman, Chris Stockton, says at the time the company was working with New York’s Department of Environmental Conservation, and the permit was advancing. “We were addressing their concerns as they came up,” he says. “We had no reason to think we would not receive that permit. We were playing by the rules and doing everything we needed to do.”

Pipeline agency fails to explain how it assesses risk, prioritizes inspections - It’s unclear whether federal regulators are properly prioritizing safety inspections on the nation’s massive network of natural gas and hazardous liquids pipelines, according to a recent report from the U.S. Government Accountability Office.Pipeline safety is overseen by the Pipeline and Hazardous Material Safety Administration (PHMSA), which is part of the U.S. Department of Transportation. With a safety staff of about 200 people covering 2.7 million miles of pipelines, PHMSA must pick and choose where it sends inspectors. Weld failures and corrosion are among the leading causes of significant incidents, according to the GAO.In order to assess the risk of pipeline segments, PHMSA relies on data from pipeline companies and plugs it into its so-called, Risk Ranking Index Model (RRIM). Each year, the model produces a score which puts them into a high, medium, or low risk category—prompting inspections every three, five, or seven years, respectively.But the GAO says PHMSA was unable to document or explain the rationale behind the RRIM model, and the agency has not used data to track its effectiveness. The situation is inconsistent with federal management principles, says the GAO.“Because PHMSA has not documented the basis for the design and key decisions of RRIM… it is unclear how effectively the model has helped PHMSA manage its inspection resources or maximize safety benefits to the public,” the report says.For example, the model inexplicably places a greater weight on longer pipeline segments, assuming they have higher relative risk than shorter segments. PHMSA officials also told the GAO the thresholds for the risk tiers were “determined based on their professional judgement that 25 percent of inspection systems should be considered high risk, 50 percent medium risk, and 25 percent low risk, to ensure a relatively consistent workload across regions.”

 FERC overrides New York pipeline permit denial (Argus) — The US Federal Energy Regulatory Commission (FERC) today overruled New York's denial of a permit needed to expand the Millennium natural gas pipeline after finding the state waited too long to make a decision. FERC found the New York Department of Environmental Conservation waived its authority to approve or deny a water permit for a 123mn cf/d (3mn m³/d) pipeline extension by exceeding a one-year decision deadline. The state should have reached a permitting decision by 23 November 2016, the agency said, but instead waited an additional nine months before denying the permit. The New York Department of Environmental Conservation said it was reviewing the decision and would consider "all legal options to protect public health and the environment." The decision marks a major win for the natural gas sector, which argues New York has been using its water permitting authority under the Clean Water Act as an effective veto against pipelines. FERC's decision moves Millennium closer to being able to construct an 8-mile (13km) extension to the CPV Valley Energy Center, a 630MW power plant set to begin operations in February 2018. Millennium said FERC's decision was "positive step forward" for the project and said it planned to request permission to start construction next week. The company said it wanted to fully cooperate with New York on "all issues related to water" and would uphold an earlier agreement to minimize effects on water crossings and wetlands. The permitting dispute centered on when the one-year deadline began for New York to act. Millennium said the clock started on 23 November 2015, when the state received the permit application. But the state argued the application needed changes and was not "complete" until 31 August 2016, which it said allowed it an additional nine months to finish its review. New York denied the permit on 30 August for reasons unrelated to water quality. The state said that FERC's review of the project was "inadequate and deficient" because it did not estimate the greenhouse gas emissions from burning natural gas at the CPV Valley Energy Center. It based its decision on a recent court ruling regarding an unrelated pipeline in Florida.

In ‘aggressive move,’ federal agency overrules New York on pipeline permit - Federal energy regulators undercut a New York environmental agency Friday, allowing a pipeline company to go forward with a project the state had previously blocked. The Federal Energy Regulatory Commission (FERC) granted a natural gas pipeline company permission to move forward with its project, even though the New York State Department of Environmental Conservation refused to grant the company a water quality permit required under the Clean Water Act. Under section 401 of the Clean Water Act, states must certify that a pipeline will not violate clean water standards before construction on that pipeline can begin. FERC ruled the state failed to meet a statutory one-year deadline to act on the permit request and therefore waived its authority to issue a decision on the application. Pipeline opponents criticized the federal commission’s ruling to overturn the state environmental agency’s decision.“FERC’s reversal of Governor Cuomo’s decision is an insult to New Yorkers and our right to protect our communities and our water,” Roger Downs, director of the Atlantic chapter of the Sierra Club, said in a statement. “States unquestionably have the authority to rule whether a dirty, dangerous fracked gas pipeline violates clean water laws, and nowhere is FERC granted the right to override that authority.” The New York State DEC said in a statement that it is reviewing FERC’s decision and “will consider all legal options to protect public health and the environment.”

FERC picks up where it left off, tackles backlog - The US Federal Energy Regulatory Commission renewed its monthly meetings Wednesday, with commissioners applauding efforts that kept the agency moving through its workload during the unprecedented six-month lapse of a quorum and acknowledging the still-hefty backlog of draft orders awaiting their decisions. "To say first part of this year until my friends arrived was an odd and unusual time at FERC would be an understatement," said Commissioner Cheryl LaFleur, who steered FERC through the quorum lapse, directing staff to ready draft orders for consideration. "I think Chairman [Neil] Chatterjee and his team are doing an excellent job mowing down the considerable backlog that we have," she added. The new commissioners have faced hundreds of backlogged draft orders. Chatterjee for his part told reporters after the meeting, "our primary focus is to work through the backlog and we continue to do that." FERC has approved 158 notional orders, which are those requiring votes, since its last meeting in January, he said. In addition, staff has issued 200 orders under the new delegation authority allowed by a special order since February. Some 68 of those were subject to further commission order, according to a staff presentation Wednesday that cataloged the work FERC has done during the quorum lapse.

Study slams FERC scrutiny of 'self-dealing,' demand for gas pipelines - Regulators are falling short of their duty to assess whether new interstate natural gas pipelines are supported by long-term demand, creating the potential for corporations to shift financial risks to utility ratepayers, a study by three non-profit groups released Tuesday contends. The report, dubbed "Art of the Self-Deal" by Oil Change International, Public Citizen and Sierra Club was released in advance of the Federal Energy Regulatory Commission's first monthly meeting in seven months. FERC is slated to decide on a slew of pending gas projects in the coming months. The study points to the 14% return on equity FERC has tended to allow for greenfield pipelines, saying the "excessive rate" distorts market signals, luring utility holding companies to invest in pipeline projects. That rate, first set in 1997 when interest rates were double today's average, exceeds what is typical for other major utility investments, it argues. It calls particular attention to projects that lean heavily on utility affiliates of project owners as customers, warning that FERC needs to scrutinize "self-dealing." Utility holding companies "are launching their own projects to cash in on the high returns associated with pipeline development," the report contends. It raises doubts about whether the projects will be underutilized, increasing financial risks for ratepayers. "FERC fails ratepayers when it takes at face value pipeline company estimates of future gas demand while the momentum behind clean energy's disruption of fossil fuel markets is accelerating," said Lorne Stockman, senior research analyst at Oil Change International and co-author of the report. The main regulatory agency is performing an "entirely superficial analysis," he contends, pointing to a dynamic energy landscape that makes demand for gas over the next 20 years highly uncertain. The report was met with a quick rebuke from gas industry officials who said it is little surprise groups opposed to fossil fuels or gas pipelines would conclude that they are unneeded.

High returns on new pipelines spur unnecessary capacity, report argues - Consumer and clean energy advocates say high rates of return on new interstate pipelines have led to a slew of unnecessary capacity proposals, including several which are now before the Federal Energy Regulatory Commission. A new report from Oil Change International, the Sierra Club and Public Citizen notes that pipelines already approved or pending before federal regulators this year could add more than 2,400 new miles of pipeline. Returns on pipeline investments can be as much as 40% higher than on other utility projects, the report notes, driving more companies to propose pipelines that the clean energy groups say are unnecessary.   Oil Change International's new report argues that pipeline proposals continue to pile up because the rate of return is so lucrative.  FERC allows a return on equity of 14% for new interstate gas pipelines, a rate set in 1997 when interests rates were much higher than they are today. "This comparatively high return provides an incentive for utility holding companies and gas producers to enter into the pipeline business, especially as utilities face stagnant or declining revenues from electricity sales," the report concluded. "It also incentivizes the building of new infrastructure over the efficient use of existing pipelines, which have been paid off by previous ratepayers." The return on pipeline investments is about 40% higher than for other utility-type spending, the report noted.Warnings against pipeline overcapacity have gained traction in the Northeast, where the Massachusetts Attorney General Maura Healey has questioned utility assessments of pipeline need.  A report in Platts' Gas Daily appears to support the argument. The outlet reported this week that planned pipeline capacity will add 17 Bcf/d to the Northeast by 2020, but gas demand is only expected to increase 2 Bcf/d. "FERC must overhaul its pipeline permitting process to protect the interests of U.S .consumers from the profit motives of pipeline developers," the Oil Change report concluded.

Virginia's environmental agency to press ahead on pipeline permits as other states hit the brakes | News | richmond.com: Facing a legal challenge, the West Virginia Department of Environmental Protection last week asked a federal court to vacate the water-quality certification it issued in March for the Mountain Valley Pipeline. A day later, the North Carolina Department of Environmental Quality delayed its pending decision on water-quality certification for the Atlantic Coast Pipeline, sending developers of the project, which is being led by Dominion Energy, a four-page request for more information. “The project involves numerous stream crossings that have the potential to affect downstream water quality both temporarily during construction and permanently,” the North Carolina regulators wrote. “Your application and responses to the division provide thorough general descriptions of the plans for the project. However, more site-specific detail is necessary to ensure that downstream water quality is protected.” Yet in Virginia, the state Department of Environmental Quality, which has been heavily criticized for its handling of the water-quality risks posed by the two pending natural gas pipelines, says it has no plans to slow down the process for either project. The pipelines face major resistance from environmental groups and some landowners and state lawmakers of both parties have asked the DEQ to slow the process. “The process for these proposed pipelines has been unprecedented in its scope and depth,” said Virginia DEQ spokeswoman Ann Regn. “DEQ is taking the time it needs while meeting the agency’s obligations to address these certifications in a timely manner.”

NC fracking commission plans illegal meeting on moratorium challenges, state officials say - The state’s Oil & Gas Commission appears ready to put fracking back on the political radar, in defiance of a warning from Gov. Roy Cooper’s administration that the commission lacks the legal authority to conduct state business. Jim Womack, appointed to the Oil & Gas Commission by state Sen. Phil Berger, said state law requires the Oil & Gas Commission to meet at least once a quarter. Womack noted that the matter has gained urgency since the board received five petitions requesting public hearings to challenge a pair of fracking moratoriums adopted by Chatham and Lee counties. Womack, a vocal advocate of shale gas exploration, has set up a meeting on Wednesday in Lee County to pick a chairman, swear in the members and set a hearing schedule and discuss complaints. No action is expected at the first meeting but the commission could ultimately decide the local moratoriums are illegal – a decision that would surely send the matter to court. The N.C. Department of Environmental Quality contends Womack is not even a member of the commission he purports to be organizing. In a letter to Womack sent Friday, the agency’s chief deputy secretary, John Nicholson, also noted that other Oil & Gas nominees have not been cleared to serve by the State Board of Elections and Ethics Enforcement. The ethics board is attempting to get all conflict of interest disclosures reviewed ahead of Wednesday’s meeting, said spokesman Patrick Gannon. Womack, a former Lee County Commissioner who is now chairman of the Lee County Republican Party, is prepared to proceed with the meeting without any legal or staff support from the state Department of Environmental Quality. Womack has published a meeting notice online, arranged for the meeting to be recorded, and lined up a public official to swear in the Oil & Gas commissioners at the Lee County government complex in Sanford. 

North Carolina fracking panel's 1st meeting delayed - A retooled state panel responsible for regulating North Carolina's potential fracking industry won't meet this week for the first time after all, avoiding possible legal showdowns involving Gov. Roy Cooper's administration and drilling opponents.The state Oil & Gas Commission was set to hold its first meeting Wednesday in Sanford as a commission appointee tried to jumpstart its work, which included addressing outside challenges to local fracking moratoria approved by two Piedmont counties.But Jim Womack, the appointee, said Tuesday that the meeting was postponed until late October or early November to give time for state ethics officials to review economic disclosure statements of commission appointees for conflicts of interest. Two or three commissioners filed these statements very late, Womack said.The Department of Environmental Quality's chief deputy wrote Womack late last week questioning whether the commission was legally able to convene in part due to pending ethics reviews. He said DEQ staff members weren't going to attend Wednesday's meeting."Rather than make this a legalistic battle, we would rather postpone the meeting and make sure those concerns are addressed, and then we'll proceed," Womack said in a phone interview.

FERC OKs Elba Island LNG liquefaction trains (Argus) — The US Federal Energy Regulatory Commission (FERC) today authorized Georgia's Elba Island LNG export project to install its planned 10 modular liquefaction trains. Elba Island would be the third major LNG export project to come on line in the contiguous US. The initial trains are scheduled to start operating in mid-2018, with full production by mid-2019, Kinder Morgan told Argus today. Kinder Morgan previously said the initial trains would start operating in mid-2018 and full production would be reached by early 2019. Louisiana's Sabine Pass LNG export terminal started exporting in February 2016 and Maryland's Cove Point LNG facility is on track to start service late this year. FERC said Elba Island needs separate approvals to start construction of other facilities at the site. Elba Island is the only major LNG export terminal being built in the contiguous US that will use small movable modular liquefaction trains. The trains will be built off site and delivered to the Elba Island facility near Savannah, Georgia, which houses an existing LNG import terminal. The modular trains are being built by Shell, which has a 20-year take-or-pay contract for all the planned liquefaction capacity at Elba Island. The use of modular technology will allow Elba Island to have a lower total cost and a faster construction schedule than the other projects being built in the US, but it would not necessarily provide Elba Island a lower unit cost. The estimated cost of the Elba Island project, including capitalized costs and associated pipeline expansions, is about $2.2bn. The 10 modular trains would have combined baseload liquefaction capacity of 2.5mn t/yr, equivalent to 350mn cf/d (9.9mn m³/d) of gas, and peak capacity of 4mn t/yr. The estimated cost of the 25mn t/yr Sabine Pass facility is about $20bn. Shell also has 20-year contracts for a combined 5.5mn t/yr of capacity at Sabine Pass. The six facilities being built would have combined baseload capacity of about 64mn t/yr and peak capacity of about 75mn t/yr, almost equaling Qatar capacity of 77mn t/yr. 

 September Basrah Light imports at LOOP rebound from August hiatus - The Louisiana Offshore Oil Port has received a flurry of Iraqi crude imports in the past few weeks, with more expected, which could be behind a recent 30% jump in open interest on the CME’s LOOP Sour futures contract.In the initial two weeks of September, LOOP has received 2.135 million barrels of Iraqi Basrah Light in three imports, according to Platts Analytics and the latest US Customs data available. Marathon was the consignee for 550,000 barrels of 28.4 API Basrah Light, which arrived September 5 on the tanker Dilong Spirit. Valero imported a further 584,000 barrels of 29.3 API Basrah Light on September 6 on the Ilma and 1.001 million barrels of 28.8 API Basrah Light on September 7 via the tanker Solana.Platts vessel-tracking software cFlow shows another two VLCCs laden with Iraqi crude are expected to arrive at LOOP in the next month. The New Achievement is expected to arrive October 8 while the Leo Voyager will arrive October 19, both having sailed from Al Basrah, Iraq.This represents a sudden rebound in Iraqi crude arriving at LOOP. LOOP receipts of Basrah Light averaged 4.5 million b/month in January-June; however, July’s roughly 3.07 million barrels was the lowest amount since February, while none was imported in August, data shows.Just shy of September’s midpoint, LOOP has received 70% of July’s total imports and 54% of June’s total.If the barrels are not stored in leased tanks, they could find a home in one of two caverns. LOOP allocates storage of Basrah Light to a cavern called Segregation 17 — comprised of Basrah Light, Arab Medium and Kuwait Export Crude — and a second cavern for the blend LOOP Sour. LOOP Sour is a blend of US Gulf of Mexico grades Mars and Poseidon, and the blend of Middle East crudes Segregation 17.

Caribbean, USGC hurricanes could result in USGC fuel oil glut: sources  -- An active hurricane season this summer in the Caribbean region has put strain on fuel oil storage and interrupted normal flows, which could result in an influx of supply headed to the US Gulf Coast, sources said. The landfalls of hurricanes Irma and Maria over the past two weeks damaged several terminals in the Caribbean. The terminals receive fuel oil from the US Atlantic Coast, Europe, and Latin America, and frequently exports to Panama, the US Gulf Coast, and Asia. US fuel oil traders said normal exports of fuel oil out of the Atlantic Coast to Caribbean terminals have hit snags this week in the wake of the landfall of Hurricane Maria. With operations at terminals at St. Eustatius and St. Croix suspended since early September, it has left traders looking to find new homes for fuel. One USAC trader said a cargo of HSFO that normally exports to the Caribbean ended up going to Panama. Two US fuel oil traders said any diversion of fuel oil out of the Caribbean could result in fuel oil going to Houston or New Orleans, adding additional fuel to what has already been described as a growing supply glut in the USGC. A US fuel oil broker said while refineries are mostly back online following Hurricane Harvey, some cokers at refineries are still down or not operating at full capacity. US Energy Information Administration data showed Wednesday that refinery yield of fuel oil in the USGC for the week ended Friday was 3.8%, the highest in the region since January 2014. USGC fuel oil prices spiked in the wake of Hurricane Harvey as suppliers sought limited fuel to fulfill contracts. The physical USGC HSFO market was assessed Thursday at a premium of $1.80/b to the October USGC HSFO swap, an indication of extreme market backwardation. Several sources said the high premiums attracted offering interest of spot cargoes to Houston. Four sources said a cargo from Venezuela containing 500,000 barrels of HSFO was set to arrive in Houston at the end of September. The broker said that if significant quantities of fuel oil are sold into Houston instead of the Caribbean, the swap markets could flip to a contango this month. On Tuesday, USGC HSFO was assessed at a discount to the front-month swap for the first time since August 18, S&P Global Platts data showed. 

 US Haynesville gas production hits 4-year high - Natural gas producers in the US Southeast are beginning to yield dividends from a bid to reverse declining production in one of the region's seemingly forgotten shale plays. Recent data from the Haynesville of Arkansas, Louisiana and Texas show production there at its highest since mid-2013. As output continues to rebound from a record low in August 2016, production from the Haynesville is already up by nearly 15%, Platts Analytics data shows. That spectacular turnaround comes amid a rapid expansion in drilling activity which has rivaled that of even the Utica or the Marcellus. In just 12 months, rig count in the Haynesville has more than tripled. Leaseholders' renewed devotion to the play comes in spite of relatively weak internal rates of return or IRRs there, which have averaged just 11% over the last year. Those returns have paled in comparison to Appalachian plays where IRRs averaged roughly 14%, in both the Utica and the Marcellus, according to data from Platts Well Economics Analyzer.

NYMEX October gas jumps 12.2 cents to $3.146/MMBtu on warmer forecasts - The NYMEX October natural gas futures contract jumped 12.2 cents Monday to settle at $3.146/MMBtu, with warmer-than-average weather expected to persist through the end of September across major demand areas.The 12.2-cent climb brings the front-month contract to its highest point since May 26, when the gas contract settled at $3.236/MMBtu.Gene McGillian, manager of market research at Tradition Energy, said "late-season cooling demand" is driving the market jump.The most recent six- to 10-day outlook from the National Weather Service calls for a high likelihood of warmer-than-average weather across the eastern half of the country, including major demand areas Chicago and New York. This continued late-season cooling demand could be giving a boost to the market as storage sits at an estimated 1.3% surplus to the five-year average, according to Energy Information Administration data. McGillian said it is possible stocks will be at their lowest point in three years heading into the winter months.Although weather outlooks currently are bullish, McGillian said production is at record levels, which could put pressure on any gains seen from the boost in cooling demand.According to Platts Analytics' Bentek Energy data, US dry production climbed to 74.4 Bcf/d Saturday, well above the 71.5 Bcf/d year-to-date average. Mexican exports and LNG feedgas have been more prevalent through 2017 than what was seen this time last year, totaling 5.9 Bcf/d year to date, 1.8 Bcf/d above this time in 2016, according to Platts Analytics.

U.S. natural gas prices rise as winter stocks look tight: Kemp (Reuters) - U.S. natural gas stocks look somewhat tight after low prices this summer worked off the excess stocks that built up in the first half of the year.  Current stocks are in line with the five-year seasonal average but that may not be enough given the increase in exports and the number of additional combined-cycle power plants that have become operational in 2017.   The last two winters have been exceptionally mild; if this winter proves colder, which is likely simply on the basis of probabilities, inventories could come under pressure. To ration power burn this winter the price of gas for delivery at Henry Hub in January 2018 has already risen by 29 cents per million British thermal units or 9 percent since early last month.  U.S. electricity producers sharply curtailed gas consumption in the first half of 2017 amid competition from alternative power sources and mild temperatures that cut overall power demand. Consumption fell by 682 billion cubic feet or 14 percent compared with the same period in 2016, according to the U.S. Energy Information Administration (“Electric Power Monthly”, EIA, Aug. 2017). First-half heating demand was almost 11 percent lower when weighted for the share of homes in each region relying on electricity for space heating. Reduced gas consumption caused stocks to rise significantly relative to the five-year average, despite a big increase in gas exports. With gas futures prices below $3 per million British thermal units for most of the summer, power burn appears to have increased during the third quarter, although detailed data have not been published yet.

Gas Producers Boost Their Already Bold 2017 Production Outlook -- An analysis of mid-year 2017 guidance shows that the nine natural gas-focused exploration and production companies we’ve been tracking are still fully committed to the very aggressive exploration and development spending they outlined at the beginning of the year. These Gas-Weighted E&Ps slightly upped their total 2017 capital budgets to $8.87 billion, a whopping 59% boost from their 2016 investment — well above the 44% and 29% increases announced by the Oil-Weighted and Diversified E&P peer groups, respectively. The gas-focused producers also increased their 2017 production guidance by 1% to 1.046 billion barrels of oil equivalent (Bboe), in contrast to the mid-year reductions in 2017 output announced by the other two peer groups. Today, we continue our review of updated capital spending plans by 43 U.S.-based E&Ps, this time with a look at companies that focus on natural gas.  Monitoring the capital spending plans and production forecasts of a sizable and representative group of U.S. E&P is helpful in assessing the status and outlook of the energy sector as a whole. In Piranha!, our market study of 43 top U.S.-based E&Ps, we examined the strategies that the companies are adopting to thrive in a world of $50/bbl crude oil and $3/MMBtu natural gas. Of that universe of companies, 21 focus on oil (60%+ liquids reserves), nine are gas-weighted producers (60%+ natural gas reserves) and 13 are diversified producers. An update of our 43 companies’ 2017 capex plans and production forecast is timely now that the E&Ps have wrapped up their second-quarter/first-half earnings announcements and conference calls. We started in Rock Steady with a big-picture look at all the companies we track. Then, in Sail On and Hold the Line, we analyzed the individual investment and production guidance for the Oil-Weighted and Diversified E&P peer groups, respectively. Today, we’re finishing up this blog series by analyzing the mid-year guidance of the Gas-Weighted Peer Group.

The narrowing light-heavy crude oil spread and what it means for US refineries - Since last winter, the price gap between light crude oil and heavy crude — otherwise known as the light-heavy differential — has narrowed considerably. In February, the price difference between Louisiana Light Sweet crude (LLS) and heavy Maya crude on the Gulf Coast was almost $10/bbl, providing an advantage to refiners who have invested in cokers and other equipment that allows them to run a heavier crude slate. But since June Maya has on average sold for only about $5/bbl less than LLS. Today we examine the shrinking price gap between light and heavy crude and its effect on coking and cracking margins. Crude oils come in a variety of qualities such as light, medium, or heavy (measured by API gravity), sweet or sour (referring to sulfur content), acidity level (denoted by total acid number), etc. Refineries are designed to process crude oils (or a mix of crude oils) meeting certain qualities to utilize their downstream processing units most efficiently while maximizing their profitability. Obviously, crude oil cost is an important factor in selecting crude oils. Heavy crude oil (with lower API gravity; see Don’t Let Your Crude Oils Grow Up to Be Condensates for more on API gravity) is more difficult and expensive to refine because it requires more complex processes to create finished refined products. Therefore, heavy crude oil is generally sold at a discount to light crude oil to account for the extra operating costs and larger investments made in downstream processing units. Lately, that discount has declined due to a number of factors –– mostly on the supply side as operational issues in key producing areas have reduced the heavy oil supply, resulting in too few barrels for too many cokers. As a result, the prices for heavier crudes like Maya (see It Ain’t Heavy, It’s My Maya) have been bid up to approach breakeven with lighter crudes. The dashed red line in Figure 1 shows the Maya price as a percentage of the price of LLS, and the solid blue line shows the discount on a $/bbl basis.

US EPA eases rules for Texas fuel storage facilities hit by Harvey - The US Environmental Protection Agency has eased several rules for gasoline storage facilities and bulk fuel terminals in Texas that were affected by Hurricane Harvey. The agency late Friday issued "no action assurance" letters waiving the rules through September 22. EPA said it would not take enforcement action against:

  • Tanker trucks for certain standards of the Clean Air Act related to tank tightness and registration.
  • Gasoline storage tank emissions during "roof landings" caused by low supplies at refineries.
  • Bulk fuel terminals that cannot operate devices to capture or recover certain air pollutants.
"Under EPA's no action assurance letters, the facilities must continue to exercise good air pollution control practices and comply with all other federal, state and local environmental laws," the agency said.

 Eagle Ford Shale's big operators getting output back to pre-Harvey levels - Three weeks after Hurricane Harvey slammed into the lower Texas coast and caused widespread production shut-ins, although little actual damage, in the Eagle Ford Shale play, several big upstream operators say they are at or nearly at pre-storm levels. Devon Energy said Friday its production is at pre-storm levels in the South Texas play. The Oklahoma City-based company produced 63,000 b/d of oil equivalent in the second quarter, including 36,000 b/d of crude oil and 96,000 Mcf/d of natural gas. Devon estimated Harvey's total impact on its net liquids production in the Eagle Ford and selected other US areas to be a 15,000 b/d reduction in the third quarter, about two-thirds of it oil. The impact should be restricted to the third quarter and Devon said it represents 0.5% of its total expected volumes for full-year 2017. Hurricane Harvey tore into the Texas Coast late August 25 near Corpus Christi as a Category 4 hurricane -- the second-most powerful on the five-level Saffir-Simpson wind scale. According to one reported estimate by IHS Markit, at one point a third of the Eagle Ford's 1.254 million b/d of August crude oil production and 4.835 Bcf/d of gas output -- figures projected by Platts Analytics -- was shut in. Platts now estimates September Eagle Ford production at 1.273 million b/d of oil and 4.896 Bcf/d of natural gas. On Thursday, SM Energy said its Eagle Ford production had also returned to pre-storm levels. The company produced 88,000 b/d of oil equivalent in the Eagle Ford in the second quarter. Harvey's total effect on its production is estimated at 200,000 boe or 2,174 boe/d, effectively reducing total previous Q3 guidance to 10.6-11 million boe (115,200-119,500 boe/d). SM also said its Eagle Ford daily operations are run from its field office in Catarina, Texas, on the western end of the Eagle Ford further inland from the coast, and was not affected by the storm. In addition, BHP Billiton's Eagle Ford fields "have returned to near pre-storm levels of production and we sustained no damage from the storm," company spokeswoman Judy Dane told Platts in an e-mail.

 Expect A Major Leap In U.S. Oil Exports -- Harvey knocked out more than 4 million barrels per day (mb/d) of refining capacity for a few days, but three weeks on from the storm, there is still some refining capacity offline. As of September 19, an estimated 15 of the 20 refineries affected in Texas and Louisiana were back to normal production, or close to normal production, according to IHS Markit. Another four were planning to restart operations.But that does not mean that all is well. For example, the U.S.’ largest refinery, the Motiva facility in Port Arthur, is still producing below capacity. Valero’s Port Arthur refinery caught fire earlier this week, an example of the perils of restarting a major refinery. ExxonMobil’s Baytown complex has restarted some production but is also not back to full capacity. The refinery disruptions have led to much smaller pool of refined products than would have otherwise been the case. That, in turn, has led to a buildup in crude stocks – the EIA reported another 4.6 million barrel increase in crude inventories in mid-September, the third consecutive week of sizable increases. But because global demand is still strong, the downstream bottleneck has led to a disconnect between the U.S. crude benchmark and its international counterpart. The discount for WTI relative to Brent is at its widest point in more than two years at nearly $6 per barrel, only slightly down from earlier this month. That makes sense – there is something of a surplus trapped within the U.S., while supplies are much tighter internationally. That wide disparity between Brent and WTI probably won’t last because U.S. crude is now incredibly competitive, and will likely be snatched up by buyers around the globe. “The export window is wide open,” Michael Wittner, global head of oil research at Société Générale, told the Wall Street Journal. The cost of transport has to be factored in, a matter of a couple of dollars per barrel. But that spread looks wide enough to make U.S. crude worth the trouble. “Get to a $4 spread and you can take it anywhere in the world," R.T. Dukes, an oil expert with Wood Mackenzie, said in an interview with the WSJ. The WSJ said that Occidental Petroleum has seen an uptick in exports recently, inking new deals with buyers in South Korea, India and China.

The New Texas Gold Rush: Buying Sand for Fracking; Suppliers, Wall Street firms and investors are buying up large areas of the West Texas desert to sell sand to drillers in the Permian Basin -- There is a new land grab going on in the oil-rich fields of West Texas. This time it is over sand. Big oil-field sand suppliers, Wall Street firms and other investors have been buying up swaths of the West Texas desert. These investors aim to mine and sell the sand to drillers in the region's booming Permian Basin, who need large quantities of sand to extract oil and gas from shale formations. Texas energy producers have typically bought the millions of pounds of sand that each well requires from mines located far from their drilling fields. After oil prices collapsed in late 2014, though, cost-conscious drillers reconsidered their well designs and recipes for the slurries they blast underground to unleash fuel from shale formations. Many West Texas drillers discovered that they could replace sand they had been shipping from mines 1,300 miles away in Wisconsin with finer grades found in dunes nearby. Doing so eliminates rail costs that sometimes are equal to or more than the sand itself. Now investors are lining up to supply local sand to West Texas drillers.  The Atlas mine is one of at least 18 under way or proposed for the desert outside Midland, Texas, according to Jefferies analyst Brad Handler. The first, Hi-Crush Partners LP's 3-million-ton-a-year facility, began operations in July. More than a dozen plan to open over the next year. The prospect of tens of millions of tons of Permian sand coming to market could drive down sand prices that have been rising nationally, Mr. Handler said. Analysts say that prices rose to as much as $45 a ton earlier in the year, from as little as $15 a ton last year. The sheer number of trucks needed to move the sand around the Permian is daunting. Robert Rasmus, Hi-Crush's chief executive, recently told investors that it would take 120,000 truckloads to deliver the Permian facilities' annual output.

Far from the Texas coast, Hurricane Harvey hits oil refiners -- Three weeks after Hurricane Harvey ravaged the massive fuel-making industry along the Texas coast, the region’s recovery from storm damage is starting to disrupt plans for crucial maintenance at refineries thousands of miles away from the flood zones. Harvey knocked out almost one-quarter of U.S. refining capacity in late August, sending gasoline and diesel prices soaring. The storm hit a few weeks before most of the nation’s fuel makers were set to begin seasonal shutdowns. Demand usually slows at this time of year, so it’s a good time to make repairs and install new equipment at plants that typically run all day every day. But at least 13 refineries from Louisiana to Montana with a combined 3.27 million barrels a day have delayed maintenance for weeks or months, according to company statements and people familiar with the situation. Some are churning out more fuel to take advantage of strong margins, while others simply don’t have the personnel because workers were dispatched to help repair and restart storm-hit facilities along the Gulf of Mexico. “Any plant that has the option of pushing back the work is probably going to do so,” Robert Campbell, head of oil-products analysis at Energy Aspects Ltd. in New York, said by telephone. "You have really good margins. There would be concerns about some of the skilled trades, some of the services required." The largest U.S. refinery, owned by Motiva Enterprises LLC in Port Arthur, Texas, is said to have pushed back maintenance on a crude unit to April from September, while Exxon Mobil Corp. said it delayed work at three refineries to divert workers to Texas, where it’s trying to restart its Beaumont and Baytown plants. While refiners such as Valero Energy Corp., Citgo Petroleum Corp. and Flint Hills Resources LLC were able to quickly restart plants in the Corpus Christi, Texas, area shortly after Harvey rolled through, Motiva Port Arthur, Total SA Port Arthur and Exxon Beaumont are among those still working to reach normal operations. At one point during the hurricane, at least 17 refineries either shut or operated at reduced rates. 

House votes to block funding for EPA methane pollution rule | TheHill: Lawmakers voted Wednesday to block implementation of a key Environmental Protection Agency (EPA) pollution rule. The House voted 218-195 to strip funding for an Obama-era EPA effort to limit methane emissions from new oil and gas drilling sites. Eleven Republicans voted against the amendment, and 3 Democrats voted to block funding for the regulation. “This rule is currently facing litigation and uncertainty, and Congress must act to block this job-killing regulation estimated to cost the U.S. economy $530 million annually,” Rep. Markwayne Mullin (R-Okla.) said during debate on the measure last week.“Methane emissions from oil and natural gas have significantly declined in recent decades without multiple, overlapping federal regulations, and this is no exception.” The EPA finalized its methane rule in early 2016 as part of an Obama administration effort to reduce emissions of the pollutant, which has significantly more global warming potential than carbon dioxide. The rule was a critical part of Obama’s second-term climate agenda. Stripping the methane rule from the books has been a leading goal of the oil and gas industry. Drillers have argued they are able and willing to reduce methane emissions on their own and under state regulations. They say that federal rules will harm their bottom lines. Republicans have largely backed the industry on the rule.

Leaked Zinke Memo Urges Trump to Shrink National Monuments, Allow Drilling -- Despite receiving 2.8 million comments from the public in support of our national monuments , U.S. Department of the Interior Sec. Ryan Zinke has advised President Trump to change the way at least 10 of these treasured areas are managed and to shrink the boundaries of at least four of them.Zinke's report , submitted to Trump in late August and leaked Sunday night , didn't address more than a dozenother monuments that had been under official review ."If President Trump accepts Zinke's advice and moves to eviscerate monument protections, he'd be ignoring the law—and the will of the American people," NRDC president Rhea Suh said. The monuments in question were established in previous administrations under the Antiquities Act, a 1906 law authorizing presidents to set aside federal lands for protection.The memo called for reductions to Bears Ears and Grand Staircase Escalante, both in Utah; Cascade Siskiyou in Oregon; and Gold Butte in Nevada, but it didn't include specific recommendations for their boundary changes. He also urged change in the use and/or management of six other monuments: Katahdin Woods and Waters in Maine; Organ Mountains-Desert Peaks and Rio Grande, both in New Mexico;Northeast Canyons and Seamounts Marine National Monument ; Pacific Remote Island Marine National Monument; and Rose Atoll Marine National Monument.Zinke also proposed opening these publicly held national monuments up to drilling, logging, commercial fishing and other activities for private profit. Suh emphasized NRDC's commitment to keeping these cherished lands and waters safe from destruction. "We will stand up for the nearly three million people who urged the administration to protect these monuments—in court, if necessary," she said. "We will not allow these special lands and waters to be handed over to private interests for drilling, commercial fishing, logging and other extraction."

Anti-fracking suit seeks to block BLM oil drilling in Nevada - (AP) — Environmentalists have filed an anti-fracking lawsuit in Nevada to block an effort to expand oil and gas drilling on federal land. Two national conservation groups say the Bureau of Land Management is reversing course from policies it enacted in the final weeks of the Obama administration that limited drilling on a vast stretch of federal land in Nevada.The Sierra Club and Center for Biological Diversity say the government failed to consider potential consequences of hydraulic fracturing ranging from harm to sage grouse to contamination of water resources. They say it’s the first time the BLM has specifically reversed a draft proposal to keep some otherwise unprotected lands off limits to energy exploration since President Donald Trump assumed office in January.

US court scraps limits on fracturing oversight — An appeals court today threw out a 2016 ruling that had blocked the US Interior Department from enforcing first-time hydraulic fracturing regulations on millions of acres of federal and tribal land. The 10th US Circuit Court of Appeals reached its decision after finding industry and state challenges to the regulations had become moot, now that President Donald Trump' administration has proposed to rescind them entirely. The disputed issues in the case had become a "moving target" that were not ready for legal challenges, the court found. The decision marks a major victory for environmentalists, who said that keeping the 2016 ruling intact would have stripped the government's authority from regulating fracturing. Sierra Club staff attorney Nathan Matthews said the decision would reinstate regulations that were developed under former president Barack Obama but never came into force. Even though the Trump administration proposed rescinding the fracturing regulations, it is still taking comment and will be unable to finalize a full repeal for weeks or months. Interior did not immediately respond for comment. The regulations were developed in response to concerns that some oil and gas companies were not taking sufficient steps to protect water resources when using fracturing to stimulate their wells. Interior set minimum standards for construction, wastewater storage and fracturing chemical disclosure that were supposed to apply starting in June 2015. But district court judge Scott Skavdahl issued a preliminary injunction putting the regulations on hold days before the enforcement deadline, in response to a lawsuit from oil industry groups and states. The next year he threw out the regulations because he said the US Congress had never given Interior the authority to regulate fracturing on federal lands. The Obama administration and environmentalists appealed that decision. Interior began to reconsider the fracturing rule after Trump took office. The agency proposed to rescind it entirely on 25 July and will accept public comments through 25 September. 

Safety agency cracks down on crude, petroleum pipeline spills - The Pipeline and Hazardous Materials Safety Administration is cracking down on smaller violations in the crude oil, petroleum, and hazardous liquid industries to combat a slow rise in the number of pipeline accidents. High-profile incidents that have spilled about a million gallons of crude oil have led PHMSA to scrutinize hazardous liquid pipelines more closely, lawyers say. The agency is asking more companies that operate those types of pipelines—including Anadarko Petroleum, Sunoco, Frontier Energy and Dakota Midstream—to fill gaps in their safety procedures. Companies that handle hazardous liquids, such as petroleum products, crude oil, anhydrous ammonia, biofuel, and carbon dioxide, are getting more letters and notices from the agency than gas and liquid natural gas companies are, data show. “The focus on warning letters and notices of amendment is kind of like ‘an ounce of prevention is worth a pound of cure,’” Indianapolis-based Paul Drucker, leader of Barnes & Thornburg’s pipeline practice team, told Bloomberg BNA. “They’re trying to correct smaller problems before they turn into big problems.” The American Petroleum Institute, Anadarko Petroleum, Sunoco, Frontier Energy and Dakota Midstream didn’t immediately respond to Bloomberg BNA’s requests for comment.In notices of amendment, PHMSA tells a pipeline operator that it lacks a particular safety procedure, or that an existing procedure lacks what the agency considers to be an important detail. The agency may then request that the operator revise, or amend, that procedure. The notices don’t carry penalties or mandatory compliance steps. 

Oil and Gas: 4 years later, cleanup nears end for big North Dakota spill  (AP) — Cleanup is finally in sight four years after a pipeline break sent more than 20,000 barrels of oil oozing across a wheat field in northwestern North Dakota, state regulators said Friday.Excavation of the affected site is scheduled for completion by the end of the month, with the land ready for replanting next spring, North Dakota Health Department environmental scientist Bill Suess said. The massive spill from the Tesoro pipeline was discovered by a Tioga farmer in September 2013 and has been called one of the largest onshore spills in U.S. history, covering 13 acres of land — or about the size of 10 football fields. Suess said about 1 million tons has been excavated from the site, and crews working round-the-clock over the years have had to dig as deep as 60 feet to remove oil-tainted soil. Tesoro, now known as Andeavor, would not confirm the state's completion timeline.  The Texas-based company and federal regulators have said a lightning strike may have caused the rupture in the 6-inch-diameter steel pipeline, which runs from Tioga to a rail facility outside of Columbus, near the Canadian border. Less than a third of the 840,000 gallons of spilled oil was recovered, and the remainder has been removed by a process called thermal desorption that cooks hydrocarbons from crude-soaked soil, Suess said. That process will continue over the winter, he said. The spill wasn't reported to the public until after state regulators — who had known about the spill for nearly two weeks — were questioned by The Associated Press. The company originally estimated just 750 barrels of oil was involved in the spill. Even after the size of the spill was increased to more than 20,000 barrels, the company said it expected the cleanup to cost $4 million, with a completion in two years. The company estimated cleanup costs at $73 million. State Environmental Health Chief Dave Glatt said cleanup costs could top $100 million for the company. The state fined the company $454,000 for the spill. "We saw the cost of the cleanup as a significant penalty," Glatt said.

Settlement with Dakota Access calls for industry education, planting of trees - North Dakota regulators approved a settlement agreement Wednesday with Dakota Access Pipeline that involves no fines for the pipeline developer but requires the company to plant additional trees and meet other requirements. The settlement approved unanimously by the Public Service Commission resolves a dispute over whether Dakota Access violated state law when the company failed to notify regulators after rerouting the pipeline to avoid Native American artifacts discovered in the route. The agreement also cancels an investigation into whether the pipeline developer removed too many trees and shrubs and mishandled soil during construction.Attorneys for pipeline developer Energy Transfer Partners and the Public Service Commission had been discussing the deal in recent weeks, and the company indicated shortly before Wednesday’s meeting that the provisions were acceptable, said PSC attorney Zack Pelham. The deal calls for Dakota Access to develop an industry reference manual for managing unanticipated discoveries and pipeline route changes during construction. Commissioners emphasized that Dakota Access did notify the State Historic Preservation Office last year when it discovered artifacts in Morton County and protected the cultural resources by rerouting the pipeline. The issue was with company’s failure to notify the Public Service Commission before rerouting the pipeline. The education manual is supposed to include an explanation of the importance of communication and transparency with the commission. Dakota Access also will be required to distribute the manual to all North Dakota pipeline companies, conduct training at the next Williston Basin Petroleum Conference and pay for a speaker to present to State Historic Preservation Office staff in Bismarck. 

San Francisco and Oakland sue top five oil and gas companies over costs of climate change - San Francisco City Attorney Dennis Herrera and Oakland City Attorney Barbara J. Parker announced today that they had filed separate lawsuits on behalf of their respective cities against the five largest investor-owned producers of fossil fuels in the world. The lawsuits ask the courts to hold these companies responsible for the costs of sea walls and other infrastructure necessary to protect San Francisco and Oakland from ongoing and future consequences of climate change and sea level rise caused by the companies’ production of massive amounts of fossil fuels. The defendant companies — Chevron, ConocoPhillips, Exxon Mobil, BP and Royal Dutch Shell — have known for decades that fossil fuel-driven global warming and accelerated sea level rise posed a catastrophic risk to human beings and to public and private property, especially in coastal cities like San Francisco and Oakland, who have the largest shoreline investments on San Francisco Bay. Despite that knowledge, the defendant companies continued to aggressively produce, market and sell vast quantities of fossil fuels for a global market, while at the same time engaging in an organized campaign to deceive consumers about the dangers of massive fossil fuel production. Like the tobacco companies who were sued in the 1980s, these defendants knowingly and recklessly created an ongoing public nuisance that is causing harm now, and in the future risks catastrophic harm to human life and property, including billions of dollars of public and private property in Oakland and San Francisco.

California refiners struggle in a state that wishes they would go away. - California refiners are under siege. State regulators seem to view crude oil refining as a nasty habit that needs to be broken. There’s an important catch, though: car-happy California is not only the nation’s largest consumer of gasoline — and second to Texas in diesel use — it allows only special, superclean blends to be sold within its boundaries. And California’s 12 remaining refineries need to meet tougher emission standards, too, making it difficult for them to expand their business or even modernize their plants. Today we discuss the irony that sophisticated refineries producing the cleanest fuels in the U.S. are faced with a shrinking market and no real hope of expansion. This blog is based on Morningstar Commodities & Energy’s recently published Outlook on California refineries. Please contact commoditiesdata@morningstar.com to request a copy of the full report. We’ve only covered California refineries peripherally in the RBN blogosphere. That’s probably a reflection of how isolated the state’s refining industry is from the rest of the Lower 48. California refineries have largely missed out on surging domestic shale crude supply — for two main reasons. First, there is a lack of pipeline capacity to ship shale crude across the Rockies (despite some projects being floated — see Is The Price of Freedom Too High). Second, there has been a lot of environmental pushback within California to proposals for alternative transport such as crude-by-rail (see Slow Train Coming). Initial hopes that shale crude from the state’s Monterey Formation would prove a big bounty were dashed by technical challenges (see Do You Know The Way to Monterey). On the downstream side of the business, California’s refiners have had to contend with a heavy burden of regulatory constraints, including the tightening grip of the state’s Low Carbon Fuel Standard (LCFS) that we first covered soon after it came into force in 2013 (see Aargh Matey! Cap’n Trade Sets Sail in California). More on the LCFS in a moment.

Are Higher California Margins Worth The Hassle For Refiners? - California’s 12 remaining refineries don’t feel much love from their native state. The refinery fleet is particularly sophisticated — capable of refining mostly heavy and sour crude oil into the ultra-clean transportation fuels that state rules require. But state regulators seem to treat refiners like unwanted guests, to the point that rules have been put in place to actively encourage the shift from petroleum-based fuels to lower-carbon alternatives. The reward for refiners’ pain comes in the form of higher refining margins — particularly during unplanned outages. Today we weigh the rewards of higher gasoline and diesel prices today against a questionable future for refining in the Golden State tomorrow.  In Part 1, we identified and described California’s 12 refineries, which taken as a group have a throughput capacity of 1.86 MMb/d, according to the Energy Information Administration (EIA). Of the dozen refineries, 10 have coking units used to process heavy oil; only Kern Oil’s small Bakersfield refinery and Chevron’s Richmond refinery do not have cokers. We also noted that the state’s refineries now get most of their crude oil from overseas (primarily Latin America and the Middle East), with most of the rest coming from either California or Alaska. Refiners in the Golden State are subject to a stifling array of regulations, from the unique low emission fuels mandated by the California Air Resources Board (CARB) to the Low Carbon Fuel Standard (LCFS) that seeks to squeeze out fossil fuels altogether in favor of renewable alternatives. Unsurprisingly, the gasoline market is shrinking — the California Energy Commission (CEC) forecasts a 17% drop in gasoline demand (to 815 Mb/d) by 2030 — and the unique CARB fuel formulas make products too expensive to sell outside California. That means there are few prospects for California refineries to expand sales elsewhere to make up for declining in-state demand. As we discuss this time, about the only upside is higher retail prices and refining margins. 

Trump admin wants to allow seismic study of Alaska refuge for oil drilling - The US Department of the Interior (DOI) is moving to open up the Arctic National Wildlife Refuge to oil exploration, which could reverse 30 years of conservation efforts in the far north of the 49th state. According to a document obtained by The Washington Post that was written in mid-August, the DOI requested that the US Fish and Wildlife Service update a 1980s provision to allow new seismic exploration in the Alaska refuge. The efforts to conduct new studies of the oil and gas under the refuge’s coastal plain are still in preliminary stages—the DOI’s draft rule allowing seismic imaging study would be subject to a public comment period and would certainly face lawsuits from environmental groups if approved. Even then, exploration efforts wouldn’t automatically trigger well-drilling in the area—extraction in the Arctic National Wildlife Refuge requires the approval of Congress as well as a market environment favorable to drilling in the remote and challenging tundra region. Currently, oil is trading for around $50 a barrel, and the price isn’t expected to rebound quickly with a glut of supply in the world oil market. Without a clear way to profit off that oil, expensive tundra drilling operations are less economically attractive compared to easier-to-tap oil fields around the world.Still, the low prices may not last, and allowing companies to do exploratory studies would be a first step toward potential drilling. A 1987 study suggested that the coastal plain in question could have a vast amount of oil underneath it, and fossil fuel advocates say that if new studies are carried out, those estimates could show even more oil than previously expected. But even without drilling, seismic studies alone could threaten Arctic ecosystems. The dramatic reductions in summer sea ice that the area has experienced as a result of climate change have driven animals like polar bears ashore. Although proponents say 3D seismic imaging studies can be conducted in ways that aren't overly invasive, the exploration activities can still disrupt pristine wildlife areas and the habitats of polar bears, musk oxen, and caribou, according to a 2001 paper from Environmental Science and Technolog

Trump administration working toward renewed drilling in Arctic National Wildlife Refuge - The Trump administration is quietly moving to allow energy exploration in the Arctic National Wildlife Refuge for the first time in more than 30 years, according to documents obtained by The Washington Post, with a draft rule that would lay the groundwork for drilling. Congress has sole authority to determine whether oil and gas drilling can take place within the refuge’s 19.6 million acres. But seismic studies represent a necessary first step, and Interior Department officials are modifying a 1980s regulation to permit them. The effort represents a twist in a political fight that has raged for decades. The remote and vast habitat, which serves as the main calving ground for one of North America’s last large caribou herds and a stop for migrating birds from six continents, has served as a rallying cry for environmentalists and some of Alaska’s native tribes. But state politicians and many Republicans in Washington have pressed to extract the billions of barrels of oil lying beneath the refuge’s coastal plain. Democrats have managed to block them through votes in the Senate and, in one instance in 1995, by a presidential veto. In an Aug. 11 memo, U.S. Fish and Wildlife Service acting director James W. Kurth instructed the agency’s Alaska regional director to update a rule that allowed exploratory drilling between Oct. 1, 1984, and May 31, 1986, by striking those calendar constraints. Doing so would eliminate an obstacle that was the subject of a court battle as recently as two years ago. “When finalized, the new regulation will allow for applicants to [submit] requests for approval of new exploration plans,” Kurth wrote in the memo. 

Trump Aims For Arctic Oil And Gas -- The Trump administration is trying to lay the groundwork to open up the Arctic National Wildlife Refuge (ANWR) for oil and gas drilling, according to a report last week from the Washington Post.It won’t be easy, and it is not guaranteed to work, but the Department of Interior is hoping to crack open the door to drilling in ANWR, which has been off limits for decades. The Post reports that the Department of Interior is working to authorize seismic testing, a necessary precursor to new drilling. The agency does not have the authority to greenlight drilling itself – only legislation passed by Congress can officially open up ANWR to the industry.But the Department of Interior is clearly betting that they can start the process by allowing seismic testing, in the event that Congress acts at some point in the future to offer up ANWR to oil and gas companies. “When finalized, the new regulation will allow for applicants to [submit] requests for approval of new exploration plans,” U.S. Fish and Wildlife Service acting director James W. Kurth wrote in an August 11 memo.Drilling in ANWR has been extremely controversial and a highly partisan issue, something that Democrats and Republicans have fought over for years, across multiple administrations. But with Republicans in control of both houses of Congress and the White House, the prospect of finally allowing drilling in ANWR seems closer to a reality than ever before.“The administration is very stealthily trying to move forward with drilling on the Arctic’s coastal plain,” Defenders of Wildlife President Jamie Rappaport Clark, who led the Fish and Wildlife Service under President Bill Clinton, told the Washington Post. “This is a complete about-face from decades of practice.” It’s a gamble that will certainly run into lawsuits from environmental groups who will fight tooth and nail to keep drillers away from the unspoiled wilderness. “ANWR is an American Serengeti. You can have the oil. Or you can have this pristine place. You can’t have both. No compromise,” Robert Mrazek, a former New York congressman and chair emeritus of the Alaska Wilderness League, told Fortune.

British Columbia sees another LNG project cancellation - The province of British Columbia was dealt another blow last week when the consortium behind the proposed Aurora LNG facility announced it would not move forward with the C$28 billion (US$23 billion) project.  Nexen Energy – the Canadian subsidiary of China’s CNOOC Ltd – and its partner, Inpex Gas British Columbia, evaluated the project over a four-year period. In a statement posted on its website, Nexen said the consortium had decided that the current macroeconomic environment was not conducive to the development of a large LNG project on Digby Island, near Prince Rupert.  This latest development followed another consortium’s decision to withdraw from an LNG venture near Port Edward, BC. Malaysia’s Petronas led a consortium that sought to develop the Pacific NorthWest LNG project, which was anticipated to have a total cost of C$36 billion (US$29 billion). A downturn in market conditions compelled the consortium to scrap the project, which included a planned natural gas export terminal on BC’s northern coast and a pipeline. A GMP FirstEnergy commodity analyst, Martin King, told the Canadian Press that companies’ decisions to back out of LNG projects were not surprising. A market surplus has triggered a drop in global LNG prices to roughly US$6 per mmBtu (US$165.96 per 1,000 cubic metres).

Potential Scenarios for the 2017-18 Natural Gas Market Withdrawal Season - Three weeks ago, Hurricane Harvey threw a wrench into the natural gas market, curbing gas demand for power generation, curtailing pipeline exports to Mexico and stymieing LNG exports. The market is still digesting the full impact of these disruptions and their potential effects on the gas market balance and storage. Adding to recent market shifts is the start-up of Energy Transfer Partners’ (ETP) Northeast-to-Midwest Rover Pipeline Phase 1A on September 1, which already is flowing 0.7 Bcf/d and lifting gas production out of Ohio. In Part 1 and Part 2 of this series, we looked at the U.S. natural gas supply and demand balance for the injection season to date. While export demand has been strong this summer, gas consumption, particularly from power generators has been down hard, trailing 2016 by nearly 4.0 Bcf/d. Supply has also lagged behind last year, not nearly as much as demand.   In Part 3, we looked at the various factors at play for the balance of injection season and some scenarios for where natural gas inventories could peak. At the time, RBN’s NATGAS Billboard storage model, which assumes the 15-day weather forecast and the 10-year average temperatures beyond the 15-day period, estimated that the inventory would peak this year at around 3,780 Bcf. That would be 267 Bcf lower than last year’s record peak of 4,047 Bcf.   But we noted a variety of factors, including the effects of Hurricane Harvey and its aftermath, that could change the trajectory of injections between now and early- to mid-November, when the inventory typically peaks. We then turned to historical storage data for some potential injection scenarios. We projected that after the 15-day outlook, if the market injects at the five-year minimum, the inventory would peak right around 3,764 Bcf, not much lower than our Billboard projection.  Since we wrote about these scenarios, the fundamentals already have shifted. The EIA reported a 91-Bcf injection for the week ended September 8, a level that is indeed in line with the five-year high for the same week and about 30 Bcf higher than last year in that week. That’s pushed the inventory up to 3,311 Bcf as of September 8th, and also pushed up the Billboard projection for the season-ending peak inventory closer to 3,800 Bcf. At the same time, the market also has yet to fully assess the impacts of Hurricane Irma, which made landfall in Florida last week and temporarily doused power burn across the U.S. Southeast. Moreover, there are several more tropical storms swirling in the Atlantic — Hurricane Jose moving north off the Atlantic Coast, Hurricane Maria barreling towards the Caribbean, and Tropical Depression Lee making its way east across the Atlantic behind Maria — that could suppress power burn levels, or stall the movement of LNG tankers in and out of the Gulf of Mexico, or both.

The quest for 10 million b/d of US oil production -- The US will produce an average 9.25 million b/d this year and the number will continue to grow over the next few years, according to the US Energy Information Administration. When will US oil producers reach 10 million b/d? And what will determine whether — or how — that benchmark is reached? Senior oil editors Meghan Gordon and Brian Scheid talk with Rusty Braziel, president and CEO of RBN Energy, andJenna Delaney, a senior energy analyst with Platts Analytics, about the output goal. Did Hurricanes Harvey and Irma impact that quest, and what areas will likely contribute to the increased production?

Plastics Won’t Save Oil - Petrochemicals are Big Oil’s big hope for the future—the distant future. Petrochemicals are used in thousands of products, with the biggest group among these being single-use plastic products. The bad news for oil is that green initiatives around the world are mounting and many of them are targeting precisely this group of products.The latest such initiative came from Kenya. Last month, the East African country introduced what is considered one of the toughest bans on plastic bags globally. The making, marketing, and use of plastic bags carry fines of up to US$38,000 or up to four years imprisonment. It’s a decisive step in tackling the piles of plastic bags that so often end up inside cows, raising fears of plastic contamination of beef. Praiseworthy as this ban may be (although some bag manufacturers have warned that the new rules could result in the loss of 80,000 jobs), it’s only a small step in the right direction. Bloomberg Gadfly’s Julian Lee, an oil strategist, points out that plastic bags represent just 1 percent of all the disposable plastic trash that enters the world’s oceans and collects in one of several notorious garbage patches. The problem for the oil industry is that small steps like this could go a long way toward stymieing the growth in global oil demand. According to estimates from the International Energy Agency, plastics production will account for 4.9 million bpd in oil demand growth until 2040, followed by aviation, accounting for 3.5 million bpd, and freight, which will account for 3.4 million bpd in demand growth in the period.  With the growing number of initiatives aimed at curbing and eventually eliminating the use of disposable plastic products or finding alternatives to them, the oil industry’s focus on petrochemicals might need to shift towards a more biodegradable future, just like their focus on crude oil is having to shift to natural gas and renewables.

Venezuela to End Dollar-Denominated Oil Deals, Currency Exchanges - The Venezuelan government moved this week to phase out the use of US dollars in oil deals and official currency exchanges. President Nicolas Maduro’s government has ordered oil traders to use other international currencies such as the euro in any crude oil deals, the Wall Street Journal reported on Wednesday. According to the report, the government has ordered traders to halt all payments denominated in US dollars, while state oil firm PDVSA has asked joint venture partners to convert existing holdings to euros. The claims were based on interviews with unnamed government officials, according to the Wall Street Journal. The Maduro administration hasn’t publicly announced such a decision, though in recent weeks top government officials have argued the country should move away from the dollar. “The market is dominated by transactions with the US dollar, and we must develop other ways to conduct international transactions,” Finance Minister Ramon Lobo told state broadcaster VTV over the weekend. “We must resort to other convertible currencies: the euro, the [Chinese] yuan, the pound sterling,” he said. Then on Thursday, Lobo announced the government’s foreign currency auctions will start offering buyers currencies such as the euro and Russian rouble. “We are making the technical and technological adjustments … so that Dicom, which is our main space for auctioning currencies, develops towards [currencies] other than the dollar,” he told teleSUR. The announcement was made amid reports the government’s main currency auction system, Dicom, had abruptly stopped selling dollars. Lobo confirmed the auction house had been closed, but said it will restart operations soon. 

Scottish North Sea oil and gas sales rise by 15.2% -  An increase in production and prices has boosted the value of Scottish North Sea oil and gas, according to new figures. Official statistics showed oil and gas production in Scotland rose year-on-year by 2.9% in 2016-17 to about 74.7 million tonnes of oil equivalent. The figure, which represented 82% of total UK production, was the highest since 2011-12. The approximate sales value was £17.5bn – 15.2% higher than in 2015-16. Scottish government statisticians attributed the rise in revenues to the increase in production and a rise in prices towards the end of last year and during the first quarter of 2017. Energy Minister Paul Wheelhouse said: “Scotland’s oil and gas industry has a bright future, and it is encouraging to see this continued increase in production which has risen by a total of 25% over the last two years. These figures show that confidence is continuing to return to the sector after a number of challenging years.”

UK oil and gas production to only last another a decade -- UK oil and gas industries are reportedly entering the last decade of production due to depleting resources, according to research conducted by the University of Edinburgh. Researchers assessed the output from the offshore fields and found resources have depleted significantly, with just 11% of oil and 9% of gas currently available for recovery. Furthermore, it revealed that fracking within the UK will not be economically viable in the long-term due to the absence of suitable locations and geological features. Published by the Edinburgh Geological Society, the study recommended increasing the use of renewable energy primarily derived from offshore wind and solar sources. University of Edinburgh School of GeoSciences professor Roy Thompson said: “The UK urgently needs a bold energy transition plan, instead of trusting to dwindling fossil fuel reserves and possible fracking”.

World Wildlife Fund sues over Greece oil spill from tanker (AP) — The World Wildlife Fund filed a lawsuit Monday over extensive pollution to the coastline outside Athens following the sinking of a tanker near Greece’s largest port. The environmental group’s Greek branch filed the lawsuit in the port city of Piraeus against “anyone found responsible,” a common practice when a party that could be held legally accountable has not been identified formally. The Agia Zoni II tanker sank Sept. 10 while anchored in calm seas and carrying 2,200 tons of fuel oil and 370 tons of marine gas oil. The ship’s cargo spilled into waters where dolphins, turtles, seals and a variety of fish and sea birds feed and live. Oil slicks have extended from the island of Salamina, near where the tanker went down, to the entire length of the Athens coast. The World Wildlife Fund said it considered the case to be “an environmental crime deserving exemplary punishment.” The Greek government has faced criticism for what many observers said was a slow, inadequate response that allowed leaking oil to spread along the greater Athens area’s coastline. The tanker sank very near Piraeus, the country’s largest and best-equipped port. The government has rejected the criticism, insisting it did everything possible to contain and clean up the slick. “The effort to tackle the pollution is a difficult affair that requires the immediate mobilization of all the responsible bodies,” Prime Minister Alexis Tsipras told his Cabinet ministers in televised comments Monday. “Already, all available counter-pollution means have been mobilized and great efforts are being made.” Demetres Karavellas, chief executive of the World Wildlife Fund’s Greece office, said it was essential to identify where responsibility lies. “Through a thorough analysis of the causes, we will emerge better prepared to avert or control similar accidents in the future,” Karavellas said.

Russia’s Gazprom Rediscovers It Needs Ukraine - Gazprom has rediscovered it needs Ukraine. With the Nord Stream pipeline down for maintenance in the Baltic Sea, Russia’s only real alternative into Europe’s lucrative gas market is via Ukraine. Russia’s biggest gas exporter needs its old partner Naftogaz, at least until it finishes building the Nord Stream II line right besides the existing one that connects north Russia to Germany. Gazprom submitted an increased order of 315 million cubic meters (mcm) for gas to be shipped through Ukrainian pipelines into Europe over the weekend. The daily order for transmission of Russian gas through Ukraine has increased by 47 mcm over the past week alone, throwing Ukraine a much-needed cash infusion from Russia. For its part, Naftogaz said it was ready to “carry out the increased order in full”, even though the order size is not stipulated by the existing contract between Naftogaz and Gazprom, the company said in a press release today.

Russia set to pipe more oil to China, stepping up race with Saudis   (Reuters) - Chinese oil refineries are gearing up to receive more Russian oil transported through an expanded Siberian pipeline network from January, likely cementing Russia’s position as China’s largest oil supplier in a close race with Saudi Arabia. The planned ramp-up in pipeline supplies agreed in contracts signed in 2013 comes amid a pledge by producers to cut output to tighten global markets and illustrates the nip-and-tuck contest between the world’s top oil exporters, Russia and Saudi Arabia, for dominance in the biggest crude importer, China. Russia’s top oil producer Rosneft said it is set to supply under government agreement 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or 600,000 barrels per day (bpd), an increase of 50 percent from this year, after completion of the second East Siberia Pacific Ocean (ESPO) pipeline, which has a main spur to Chinese border town Mohe. “Rosneft has enough resources to supply under all its existing contracts, including the planned increase of supplies to China by 10 million tones next year,” Rosneft said in a statement emailed to Reuters on Thursday. Top state oil firm PetroChina has designated three refineries in northeast China as the main receivers of Russian oil, with one of them undergoing an $880 million upgrade. Liaoyang Petrochemical Corp, in Liaoning province, already a regular processor of Russian oil, is expected to double its refining capacity with the upgrade to 400,000 bpd by the end of 2018, said two refinery sources. “Plants were told to be prepared for more Russian oil next year ... Liaoyang will be the main participant as it’s poorly located for seaborne shipments,” said one of the refinery sources.

China’s Oil Demand Is Growing At More Than Double Last Year’s Pace - Last week OPEC released its Monthly Oil Market Report which covers the global oil supply and demand picture through July. OPEC crude oil production decreased by 79,000 BPD in August to average 32.8 million BPD. This marks the first OPEC production decline since April and was primarily driven by sizable outages in Libya.  The cartel revised global oil demand growth for 2017 upward by 50,000 barrels per day (BPD) to 1.42 million BPD. The group reports strong growth from the OECD Americas, Europe, and China. Global oil demand for 2018 is expected to grow by 1.35 million BPD, an upward revision of 70,000 BPD from the previous report. Growth next year is expected to be driven by OECD Europe and China. China’s oil demand rose by 690,000 BPD in July, marking a 6% year-over-year (YOY) increase. China’s total oil demand reached 11.67 million BPD in July. Year-to-date data indicates an average growth of 550,000 BPD, more than double the 210,000 BPD growth recorded during the same period in 2016. China’s gasoline demand was higher by around 0.10 million BPD YOY, driven by robust sports utility vehicle (SUV) sales, which were around 17% higher than one year ago. China’s overall vehicle sales in July rose by 4% YOY, with total sales reaching 1.7 million units. The numbers from China are interesting given the constant refrain of weakening Chinese demand. This seems to be wishful thinking based on China’s investments in clean technology. China is the world’s top market for electric vehicles, and they recently announced that they have started “relevant research” and are working on a timetable for implementation of a ban on vehicles powered by fossil fuels. China may indeed join the ranks of countries banning fossil fuel vehicles. This news helps drive the narrative that the age of oil is nearing its end, but China is a long way from reining in its oil consumption growth.

Oil Traders Empty Key Crude Storage Hub - Oil traders are emptying one of the world’s largest crude storage facilities, located near the southernmost tip of Africa, as the physical market tightens amid booming demand and OPEC production cuts.Total SA, Vitol Group and Mercuria Energy Group Ltd. are selling crude they hoarded in Saldanha Bay, South Africa, during the 2015-2016 glut when the market effectively paid traders to store oil, according to people familiar with the matter, who asked not to be named discussing private operations. Crude demand is now seasonally outstripping supply, tightening the physical market for some crude varieties to levels not seen in the last two years and encouraging traders to sell their stored oil.“The market is selling inventories from everywhere,” Mercuria Chief Executive Officer Marco Dunand said in an interview in Geneva.Although largely unknown outside the oil trading industry, Saldanha Bay is one of the world’s largest crude storage facilities, with the capacity to hold 45 million barrels in just six gigantic, partially-buried concrete tanks. By comparison, Cushing, the better-known U.S. oil storage center in Oklahoma that serves as the pricing point for the West Texas Intermediate oil benchmark, can hold about 75 million barrels in more than 125 tanks. Mercuria, which operates a blending operation at the South African terminal, has been offering cargoes from the facility, with China the likeliest destination, according to traders with knowledge of matter. Total has also been seeking tankers primarily to load Nigeria’s Escravos crude from its tank in Saldanha Bay. In addition, Vitol has been unwinding its crude stores at both Saldanha Bay and in northwest Europe, the traders said. Vitol and Mercuria declined to comment on their Saldanha operations. Total didn’t immediately respond to a request for comment.

LNG growth to propel oil and gas industry's carbon emissions - (Reuters) - Liquefied natural gas will be the biggest source of carbon emission growth for the world’s top oil and gas companies by 2025, according to a new study by Wood Mackenzie, as demand for the super-chilled fuel is set to rise sharply. Oil and gas companies such as Exxon Mobil, Royal Dutch Shell and Total have promoted natural gas as a cleaner fossil fuel that will displace coal to meet growing demand for energy as the world shifts away from fossil fuels in the coming decades. But converting natural gas into LNG by cooling it to minus 160 degrees Celsius in order to transport it to demand centres is a highly energy-intensive and therefore emission-intensive process, according to WoodMac analyst Amy Bowe. Capping emissions of heat-trapping gases by the oil and gas industry has moved to the forefront of investors’ agendas in the wake of the 2015 Paris climate agreement to limit global warming to below 2 degrees Celsius by the end of the century. Companies are coming under growing pressure to tackle emissions from flaring excess gas at oil fields as well as limiting the emissions of methane, a highly potent greenhouse gas, from pipelines and LNG terminals. The Edinburgh oil and gas industry consultancy said in a study that emissions from oil and gas production operations of 25 of the world’s top energy companies are nevertheless expected to rise by 17 percent by 2025. Fossil fuel output will increase by 15 percent over the same period. Emissions resulting from LNG production are forecast to grow by 43 percent over the period compared with a 22 percent increase in supply, “representing the largest absolute increase in emissions,” according to the report. Around 10 percent of gas processed by an LNG terminal is lost into the atmosphere, Bowe said in an interview. “If you look at the emissions produced just through the extraction and production of it, LNG is more emissions-intensive than pipeline gas and that is largely due to the liquefaction process,” Bowe told Reuters.

“Super Critical” Coal Shortage Sends India Scrambling For NatGas - Local media reported this week that India’s power generators are seeing a sudden surge in natgas buying because of an “acute” shortage in the country’s go-to energy fuel: coal. With ten major power plants classified as “critical”, with less than seven days of coal stocks — and five of those being “super critical” with less than four days of coal supply. And that drastic shortage has reportedly turned these generators to natural gas in a major way. India in fact has over 25 GW of installed gas-driven generating capacity. But here’s the thing: 55 percent of that capacity usually never runs. Because it’s “technically stranded” — having no access to natgas feed at commercially-competitive prices. But the coal crisis is changing the economics here. Power operators are so desperate to keep the lights on, they’re willing to pay the higher prices required to deliver gas to the stranded power plants — causing this week’s major surge in natgas buying. If the coal shortage persists, that demand could become permanent.

World’s largest LNG buyer posts decline in August imports | LNG World News: Japan’s liquefied natural gas (LNG) imports dropped by 6 percent in August year-on-year, according to the provisional data released by the country’s Ministry of Finance. The world’s largest buyer of the chilled fuel imported 7.26 million mt of LNG last month as compared to 7.72 million mt in August 2016. This is Japan’s second monthly decline in LNG imports this year. Japan paid about $3.1 billion for LNG imports in August, a rise of 27.4 percent when compared to the same month in 2016. On the other hand, the country’s coal imports for power generation rose by 23.5 percent to 10.1 million mt, the data showed. To remind, the average price of spot LNG imported into Japan that was contracted in August was at $5.8 per million British thermal units (mmBtu), reaching a five-month high. The arrival-based price was at $5.6 per mmBtu, the same as the previous month that was the lowest since August 2016.

South Korea's Kogas August LNG sales fall 11.8% on year -- South Korean state-owned Korea Gas Corp's LNG sales dropped 11.8% year on year in August due to mild summer weather, the company said Monday. Kogas, which has a monopoly in domestic natural gas sales, sold 1.94 million mt last month, from 2.2 million mt a year earlier, the utility said in a regulatory filing. It marked the fourth consecutive decline after rising for three months in a row early this year. August sales were also down 9.3% from 2.14 million mt in July. Kogas did not disclose how much LNG it sold for the first eight months, but S&P Global Platts calculations based on Kogas' previous report showed it sold 20.73 million mt over January-August, down 1.9% from 21.14 million mt in the year-ago period.

Middle East 2018 LPG term supply volume set to be stable on year - The 2018 LPG term supply volume from the Middle East is expected to hold stable from 2017, despite expectations of lower LPG production due to the crude oil output cut agreement among OPEC and non-OPEC members, traders said this week, as the term contract renewal negotiations kicked off."There is no big reason why the term volumes might change from this year to the next," a Middle Eastern trader said. His views were echoed by other Asian term lifters and Persian Gulf producers as well.Saudi Aramco's 2018 LPG exports would be largely steady from this year, a company source said Wednesday. "The term volume next year would be similar to this year's, around 8.5 million to 8.9 million mt," the Aramco source said. He added that there will be little impact on LPG production from the OPEC-led crude output cuts, as most of the LPG produced in Saudi Arabia is from associated gas.

Oil revenues real motive for Kurdistan independence vote -- Iraq's semi-autonomous Kurdistan region is to hold an independence referendum on September 25 -- a move that the central government in Baghdad is strongly opposed to. Regional players like Iran and Turkey have also raised the alarm about the planned referendum, arguing that it could create further instability in the region. Press TV has discussed the issue with Sa'ad al-Muttalibi, a member of the State of Law Coalition, as well as Nabil Mikhail, a professor at George Washington University.Sa’ad al-Muttalibi believes the leader of Iraq’s Kurdistan region, Massoud Barzani, has been using the referendum to further blackmail the political system in the country to gain higher oil revenues.He went on to say that Barzani’s main aim is to add the Kirkuk region, which accounts for about 40 percent of Iraq’s total oil production, to the new Kurdish independent state.Authorities in the Iraqi Kurdistan want Kirkuk, which is divided along ethnic lines between Turkmen, Kurds and Arabs, to be included in their autonomous protectorate, but Baghdad rejects it.The province is aggressively coveted by Kurdish authorities because it holds more than 9 billion barrels of oil reserves, with a capacity to produce more than 1 million barrels a day.The analyst also asserted that Barzani is well aware that the establishment of an independent Kurdish state will definitely constitute a threat to the national security of Iraq and the neighboring countries in the Middle East. However, he said, the Kurds are planning to go ahead with the referendum which is “illegal and unconstitutional” without considering its “serious threats.”

OPEC’s No. 2 Faces Civil War Threat -- Tribal violence in the southern regions of Iraq is erupting on sectarian lines, threatening safety and security at oil facilities, officials told Kurdistan24.A majority of Iraq’s law enforcement network has congregated in the northern and western portions of the country to contain the efforts of the Islamic State to restart the reign of its illicit organization, giving Shia and Sunni the leeway to reignite previous rivalries. “We need larger forces to control rural areas and restrain lawless tribes in the south,” Army Lieutenant Colonel Salah Kareem said. “This is a difficult job for now as most troops are busy with fighting [IS].” The religious disputes turn legal as members quarrel over farmland, construction contracts, and other land ownership issues, security courses said. The net impact of the disagreements disrupts Baghdad’s efforts to bring new investments to the oil and gas sector in areas affected by three years of domestic strife. Stable oil output from Basra is key to Baghdad’s wealth, which accounts for 95 percent of the government’s revenues. Recent encroachments on the peace in the area have jeopardized key oil facilities on the northern and westerns sides of the city.“Tribal feuds have been exacerbating recently, and such a negative development could threaten the operations of the foreign energy companies,” Ali Shaddad, the head of Basra’s oil and gas committee on the provincial council, said.Groups in the area seized heavy weaponry from Saddam Hussein’s army back when the dictator’s regime collapsed in 2003. The presence of these military-grade guns makes any conflict in the area that much more deadly.

The Most Bullish Oil Report This Year - Despite the huge uncertainties related to the two massive hurricanes that hit the U.S., the global oil market looks tighter than it has in a long time, according to a new report from the International Energy Agency. Global oil supply fell in August for the first time in four months, the IEA said, a result of a dip in OPEC’s oil production, combined with refinery maintenance and sizable outages from Hurricane Harvey. World oil supply fell by 720,000 barrels per day (bpd) in August compared to July, a significant decline that will aid in the market’s progress towards rebalancing.Multiple outages contributed to the decline in global output. Hurricane Harvey resulted in U.S. oil production falling by 200,000 bpd in August—outages that occurred mostly in the Eagle Ford shale and offshore in the Gulf of Mexico. But OPEC also saw its collective output fall by 210,000 bpd in August, mainly from disruptions in Libya.The supply outages will go a long way toward adding some momentum to the rebalancing effort, even if some of them are only transitory.Another notable issue, the IEA said, was that U.S. oil supply is quite a bit lower at this point than it expected, and not just because of Harvey. The agency singled out the fact that U.S. oil production actually declined in June from a month earlier, an unexpected development. That meant that the Harvey disruptions resulted in output declines from a lower-than-anticipated base. The demand side of the equation also looked bullish. The IEA revised up its forecast for oil demand growth this year, upping it to 1.6 million barrels per day (mb/d) from its July estimate of just 1.5 mb/d. The second quarter stood out, with quarterly growth of 2.3 mb/d year-on-year—the highest in two years. The Paris-based energy agency said that demand in OECD countries (i.e., rich industrialized countries that tend to have weak demand growth rates) “continues to be stronger than expected, particularly in Europe and the U.S.” The stronger forecast is notable not just because it puts oil demand growth at its hottest in a long time, but also because the IEA essentially shrugged off any lingering effects from the storms in the U.S., concluding that the “impact on global markets is likely to be relatively short-lived.”

OPEC, non-OPEC ministers mull oil output cut extension through 2018: Luaibi -- Ministers in the OPEC/non-OPEC coalition are considering various options to extend their crude oil output cut deal, including an additional 1% reduction in supplies and a continuation of the deal through the end of 2018, Iraq's oil minister said at a conference Tuesday. But no firm decisions have yet been reached, Jabbar al-Luaibi told delegates at the Gulf Intelligence Energy Markets Forum in Fujairah, adding on the sidelines that he personally did not see the need for further cuts but would support any OPEC consensus on the issue. It would be "premature" to make any changes to the agreement, seven months before its March expiry, he said. The agreement, which went into force January 1, calls on OPEC and 10 non-OPEC producers, led by Russia, to cut a combined 1.8 million b/d in output through March 2018 in order to rebalance the market and induce draws of oil from storage. The Joint Ministerial Monitoring Committee overseeing the deal, consisting of ministers from Kuwait, Russia, Venezuela, Algeria and Oman, will meet Friday in Vienna to assess compliance and review market conditions, including the impact of hurricanes Harvey and Irma. Representatives from Nigeria and Libya, both of which are exempt from the cuts as the nations' recover from civil unrest, will also attend to provide their production outlooks. No decisions on the cuts are expected at the meeting, with OPEC sources having said that any changes to the agreement likely will not be voted on until the bloc's next full summit on November 30. "This is a routine meeting of the JMMC," one OPEC delegate told S&P Global Platts. OPEC's total crude oil output fell in August for the first time in five months to 32.65 million b/d, down 170,000 b/d from June, according to the latest Platts OPEC survey, which is one of six secondary sources used by the organization to monitor production. The fall in output came as outages in Libya interrupted the country's recent dramatic recovery, more than offsetting gains in Nigeria.

OPEC says it is winning the battle to curb the oil glut. (Reuters) - Output cuts by OPEC and other oil producers are clearing a supply glut that has weighed on crude prices for three years, ministers said at a meeting on Friday to review the pact that expires in March 2018. The Organization of the Petroleum Exporting Countries, Russia and several other producers have cut production by about 1.8 million barrels per day (bpd) since January. The group is considering extending the deal beyond its March expiry, although two sources said Friday's gathering was unlikely to make a specific recommendation on an extension. Ministers on a panel monitoring the pact, comprising Kuwait, Venezuela and Algeria, plus non-OPEC Russia and Oman, were meeting in Vienna after oil prices gained more than 15 percent in the past three months to trade above $56 a barrel. "Since our last meeting in July, the oil market has markedly improved," Kuwaiti Oil Minister Essam al-Marzouq said in an opening speech at the meeting he is chairing. "The market is now evidently well on its way towards rebalancing." Russian Energy Minister Alexander Novak said OPEC and other producers now needed to work on strategy beyond March. "We need not only to keep up the pace but continue our coordinated joint actions in full, but also work out a strategy for the future, to which we will stick starting from April 2018,” he said, adding oil demand was rising at a "high pace". Officials said before Friday's meeting that the Joint Ministerial Monitoring Committee would consider extending the supply cut pact. But two OPEC sources said the ministers were not likely to make a specific recommendation for an extension. The committee can make policy recommendations for the wider group of OPEC and non-OPEC producers, which meets in November. Global oil inventories have shown signs of falling, although OPEC-led efforts to cut stockpiles to their five-year average has taken longer than expected. Oil prices remain at only half their level of mid-2014.

Storms worsen unprecedented summer slump in U.S. diesel supply (Reuters) - U.S. diesel stockpiles did something this year that has never happened in the summer before: They shrank. And that was even before Hurricane Harvey landed, knocking out a quarter of U.S. refining capacity, crippling production of fuel products. Thanks to surprising summer demand, particularly from exports, inventories of diesel, jet fuel and heating oil were heading into the busy winter at their lowest levels in three years. Harvey’s effects cost refiners even more production of fuel, raising the possibility of shortages and higher prices if the United States suffers another major disruption or an unexpectedly frigid winter. Since 2000, between June and September distillate inventories have risen by an average of 10 percent, but this year, they fell by 2.2 percent, the first decline since 1982 when record-keeping began, a Reuters analysis of U.S. Energy Information Administration data shows. The summer is typically when refiners build stocks of distillates to meet growing fall and winter demand for heating oil and crop harvesting. “If we get another hurricane or similar event, things could get real tight,” said Robert Campbell, head of oil products markets at London-based Energy Aspects. Inventories typically remain flat or rise modestly through September, and while some refiners delayed scheduled work, the loss of the Gulf has hit overall U.S. refining. As a result of Harvey, distillate stocks fell another 4.6 million barrels in the first two weeks of September, EIA data shows. U.S. distillate stocks are now at three-year lows for this time of year, and 5.2 percent below their historical average. The last two winters have been among the warmest ever recorded, but forecasters this year are predicting a colder, more typical season, according to Reuters data. 

Hedge funds crowd in to bet on gasoline and diesel: Kemp (Reuters) - Hedge funds continue to wager on a shortage of refined fuels driving prices higher, even as U.S. refineries gradually restart operations in the aftermath of Hurricane Harvey.Hurricane-related flooding caused extensive disruption to the major U.S. refining centre along the Gulf of Mexico in the first half of September. But most Gulf Coast refineries have begun to restart and should be fully operational within the next few days, with only limited outages lingering for longer.And exceptionally high refining margins are encouraging refineries in the rest of the world to maximise output to cover the supply shortfall.The post-hurricane bet on fuel shortages therefore risks becoming a crowded trade with a sharp price reversal when portfolio managers try to take some profits and exit.Hedge funds and other money managers raised their net long position in U.S. gasoline futures and options to 69 million barrels in the week to Sept. 12, the highest level since May 2014.Sentiment has experienced a sea change since mid-June, when portfolio managers were running an overall short position of 21 million barrels (http://tmsnrt.rs/2xKUtGV).  Hedge funds also lifted their net long position in U.S. heating oil by 5 million barrels to 46 million barrels last week, the highest since February 2013, according to the latest data from regulators and exchanges.And fund managers boosted their net long position in European gasoil by 1.2 million tonnes to a record 17 million tonnes.Hedge fund positioning in all fuels appears very stretched with long positions outnumbering shorts by 19:1 in gasoil, 4.4:1 in gasoline and 3.5:1 in heating oil.In contrast, positioning in the main crude oil contracts linked to Brent currently appears much less lopsided and there is an unusually low ratio in WTI.The likely outcome is a sharp narrowing of gasoline and distillate cracks when the post-hurricane trades unwind, with crude and especially WTI prices rising while gasoline and diesel come under pressure.

IEA: Oil Price Spike Coming In 2020 - The oil market has been awash in crude for more than three years, and OPEC has struggled to accelerate the rebalancing effort, but the world could be heading for a supply crunch in a few years due to the sharp fall in industry spending.The halving of oil prices from $100 per barrel before 2014 down to just $50 today has led to a corresponding plunge in upstream investment. But even as benchmark prices seem to have stabilized over the past year, with most analysts predicting gradual and modest gains in the year ahead (depending on OPEC’s actions), there’s still no sign of a serious rebound in spending levels.The problem of a shortage of supply seems very far off today, given the swift turnaround in U.S. shale and persistently high levels of crude storage.But demand continues to rise—the IEA just upgraded its demand growth estimate for 2017 to 1.6 million barrels per day (mb/d). If that level of demand growth continues for a few years, it will more than devour the excess supply on the market. Even a more tempered growth rate would strain supplies toward the end of the decade, absent a corresponding uptick in production.“There are still not enough signs of investment beginning to return, and that raises the risk of tightening of the market in the next five years and a risk to the stability of oil prices,” Neil Atkinson, head of the IEA’s oil markets and industry division, said at a conference in Bahrain.“There is at least a possibility of going back to the situation we had 10 years ago where oil prices were very, very high at a time when demand was growing.”Atkinson warned that the market’s spare capacity—largely concentrated in Saudi Arabia—will dwindle as demand keeps rising at a time when supply remains stagnant. The market will tighten and OPEC will have to abandon its production limits in order to satisfy demand. After that, rising consumption could whittle away at the latent surplus capacity. At that point, the market will hit a supply crunch, which would likely result in higher volatility and higher prices. The one difference between the mid-2000s and today, however, is that the market is sitting on near record levels of oil in storage, which will act as a sort of second form of spare capacity. It could take a few years to draw down those stockpiles. On the other hand, unlike 10 years ago, the industry today isn’t spending huge sums to develop new sources of supply.  Spending has increased a bit this year, but the IEA still warns that it is insufficient to meet future demand.

Have Oil Markets Reached A Turning Point? - WTI and Brent hit fresh highs in early trading on Tuesday, with oil demand looking particularly robust and fears over hurricane damage to the market having receded. Both benchmarks were at their highest levels in months but saw a slight drop off as trading continued.. After a quarter of U.S. refining capacity was knocked offline, fuel shortages cropped up, creating a unique opportunity for unaffected refiners. “You’ve got a lot of refiners running at full tilt, and they’re going to make better margins,” Sandy Fielden, an energy analyst with Morningstar Inc., told the WSJ. “Supply and demand is effectively telling the market that there’s a big incentive to produce more.” Refining margins for some East Coast and Midwestern processors have jumped by as much as a third, the WSJ says. PBF Energy (NYSE: PBF), a company with refining assets in the Northeast and the Midwest, has seen its stock price surge by as much as 26 percent since August 21.   The WSJ reported over the weekend that the U.S. might not actually withdraw from the Paris climate accord, despite President Trump’s decision to do so in June. The Trump administration denied any change in policy, and the President’s top economic adviser, Gary Cohn, met with climate ministers from around the world on Monday. He told them that the U.S. would only stay in the Paris climate pact if the terms of doing so were more favorable. However, the administration routinely fails to recognize the fact that the pact consists of voluntary, not mandatory, targets. In theory, the administration could revise its commitments and stay in the pact.   Iraq’s oil minister hinted that OPEC might consider deeper and longer cuts, pushing the current output limits out through the end of 2018. Jabbar al-Luaibi said the group could take an additional 1 percent off of global supply, which would help to further rebalance the market. Still, he said there is “no firm decision yet.”

WTI/RBOB Jump After Smaller Than Expected Crude Build --After last week's record-breaking draw in Gasoline stocks, and big crude build, the noise from Harvey and Irma disruptions continues to add volatility to the data. API reported asmaller than expected crude build and bigger than expected gasoline (and distillates) draw sent prices for both WTI and RBOB higher. API:

  • Crude +1.43mm (+3.9mm exp)
  • Cushing +420k (+900k exp)
  • Gasoline -5.063mm (-2.13mm exp)
  • Distillates-6.13mm

A smaller than expected crude build and considerably bigger than expected draws in gasoline and distillates...WTI and RBOB prices slipped lower on the day heading into the API print with Crude glued at $50...The kneejerk reaction was a spike in both WTI/RBOB...

Oil Price Volatility Is Set To Return - Oil markets could experience more intense price volatility in the coming years because of insufficient investment in new production, according to the head of the International Energy Agency’s oil market and industry unit, Neil Atkinson.  Over the next five years, it is not impossible to see a return to the high oil prices from a decade ago, Atkinson said.In its latest Oil Market Report, released last week, the IEA said crude oil demand had grown by 2.3 percent on an annual basis in the second quarter, which prompted an upward revision of the overall growth rate for 2017 to 1.6 million bpd. The revision boosted oil prices, with Brent once again above US$55 a barrel for the first time in about five months. Atkinson noted at the Manama conference that although over the medium term the rate of demand growth will slow, it may do so from a higher point than previously forecast, in tune with the new demand growth revision. What’s more, over the longer term, to 2040, the IEA forecast the share of oil in the global energy mix will decline only slightly, from 33 percent in 2015 to 31 percent in 2040, which means stable growth in demand as part of the growth in wider energy demand. The problem with new investments, however, remains. Bahrain’s oil minister, speaking at the same event as the IEA official, said that although prices have improved lately, they are not high enough to motivate sufficient investment in new production. Bahrain’s top oil man is not the only one warning about a possible supply crunch, but given these officials’ vested interest in the effect of supply crunches on prices, their comments are better taken with a pinch of salt.

Weekly Petroleum Report -- September 20, 2017 Weekly petroleum report, highlightsRe-balancing: 46 weeks.

  • crude oil inventories increased by 4.6 million bbls from the previous week
  • at 472.8 million bbls, US crude oil inventories are in the upper half of the average range for this time of year; two points to consider:
  • number of years to determine the average not stated
  • the huge glut of crude oil inventories since 2014 have skewed the average upwards
  • gasoline inventories decreased 2.1 million bbls, but gasoline also remains in the upper half of the average range;
  • gasoline supplied: average 9.5 million bbls per over the past four weeks
  • distillate fuel product was up 14.5% from the same period last year
  • refinery operating capacity clawing back from a recent low of 79% to 83% this past week
  • gasoline production continues to decrease on a weekly basis while distillate fuel production is increasing
  • US crude oil imports increased by almost one million bopd (actual: 888,000 bopd)

WTI/RBOB Drop After Smaller-Than-Expected Gasoline Draw, Big Crude Production Rebound --API data (smaller than expected build) and a weaker dollar have supported WTI overnight but as the DOE data hits, we are reminded that the impact from hurricane season lingers. WTI/RBOB prices kneejerked lower after DOE reported a bigger than expected crude build and a gasoline draw that was considerably smaller than API's reports. Crudeproduction continues to rebound back near cycle highs. DOE:

  • Crude +4.59mm (+3.9mm exp)
  • Cushing +703k (+900k exp)
  • Gasoline -2.13mm (-2.13mm exp)
  • Distillates -5.693mm (-1.95mm exp) - biggest since Nov 2011

A big Distillates draw (most since Nov 2011) is being ignored for now as gasoline's draw was considerably less than API reported and crude's build more than expected... Distillates stockpiles are now lower than the five-year average and totals are at the lowest level since July 2015.As Bloomberg's Laura Blewitt notes, as expected, refinery runs rocketed up last week. Both crude inputs and gross oil inputs rose by the most since 2008 as Gulf Coast refiners got back online. Production continues to rebound as more of Texas comes back online (despite the stagnation of oil rig counts)... Heading into the DOE print, WTI was higher and RBOB lower since API (helped by a slightly weaker dollar) but both weakened on the DOE print kneejerk...

Refinery margins to benefit from low product, high crude oil stocks levels - Refinery margins in the US and Europe will remain supported by increasing crude and decreasing product stocks levels, according to data by PJK International."Th outlook is quite positive," Patrick Kulsen, managing director of PJK International told Platts annual refining conference in Brussels Friday. “We expect refinery margins to remain strong for the medium term," Kulsen added.Crude stocks have been growing as US production remains strong in a move similar to the end of 2014 when crude oil was sold at discounts "to stimulate higher utilization rates," said Kulsen.2015 saw refineries ramp up their utilization to capture the healthy margins, which in turn brought up higher stocks levels in 2016 which pushed both refinery runs and margins down. But this year "product stocks have been lowered significantly," Kulsen said, while product demand is up "with European economic growth and international trade gaining momentum." Distillate demand has increased both in the US and Europe, Kulsen said.

U.S. heating oil market looks tight this winter: Kemp (Reuters) - U.S. stocks of distillate fuel oil, which have been trending downwards all year, now look tight following disruption to major refineries caused by Hurricane Harvey.The position is a marked turnaround from the start of the year, when distillate stocks were at record levels following the second warm winter in a row and a prolonged slowdown in freight movements since 2015 (http://tmsnrt.rs/2xXkH9p).Distillate fuel oil is used mostly for high-horsepower diesel engines used in trucks, trains, barges and pipelines as well as some industrial engines, so demand is closely linked to manufacturing activity and freight movements.Distillates are still used as heating oil for some homes, schools and commercial buildings, especially in the Northeast, though this source of seasonal demand has become less important in recent years.By the second week of February 2017, distillate stocks stood at 170 million barrels, which was 8 million higher than at the same point in 2016 and 33 million above the 10-year seasonal average.But a recovery in freight, coupled with a boom in oil and gas drilling, which relies heavily on diesel, and record exports to Latin America and other markets have steadily whittled away the surplus.By the end of August, stocks had fallen almost 14 million barrels since the start of the year, were 5 million barrels below the corresponding point in 2016, and just 8 million above the long-term average.Refinery outages in Texas and Louisiana following Hurricane Harvey have caused stocks to decline by another 10 million barrels since the start of September, leaving inventories looking tight with winter approaching.Distillate stocks had fallen to just 139 million barrels by the end of last week, which was 25 million barrels below 2016 and 5 million barrels below the long-term seasonal average. In response, futures prices for ultra-low sulphur diesel (ULSD) this winter have moved in a big backwardation since the end of August, reflecting concerns about scarcity. .. U.S. distillate prices are already rising to reduce exports and encourage refineries in the United States and elsewhere to ramp up production.The last two winters have been exceptionally mild in most of the United States which has limited heating oil demand.But if temperatures in the forthcoming winter are closer to the long-term average, distillate stocks could become very tight without very high refining runs.

Commentary: Looking for balance in the oil market – IEA -  There is more than one way to look at oil-market balances. The IEA uses a straightforward approach: supply minus demand, which we report in the monthly Oil Market Report as “Total stock changes and Miscellaneous.” Part of the calculation can be easily explained by changes in OECD stocks, floating storage and oil in transit. The remaining “miscellaneous to balance” is less clear. This element, which implies unreported non-OECD stock changes, has come under scrutiny recently particularly as Chinese crude-oil balances have risen to unprecedented levels. The following commentary expands on the analysis we provided in the September issue of the Oil Market Report, where we took a close look at our “miscellaneous to balance” and drew a distinction between crude oil and product balances to have a clearer view of oil market developments. The world oil market appears to have returned to balance this year, thanks to a substantial stock draw in the second quarter. As global demand exceeded supply, our balances in 2Q17 implied a 0.9 million barrels a day (mb/d) decline in inventories, the first draw since 4Q13. Somewhat counter-intuitively, the price of Brent was $4/bbl below the first quarter.   In 2Q17, refined product markets drew nearly 1 mb/d of stocks, as refining activity lagged demand growth. The OECD refined product stocks drew by 0.3 mb/d, implying a 0.6 mb/d draw from non-OECD countries. There is no comprehensive non-OECD stocks data to confirm this, however non-OECD total demand grew by 1.1 mb/d year-on-year in 2Q17 while refining throughput was flat. A 0.6 mb/d draw was close to the 0.5 mb/d implied build in 1Q17, so the stock draw would have been technically possible. Forecasts of refinery runs and demand for 3Q17 and 4Q17 imply continued refined product stock draws. Even in 3Q17, when global headline oil balances show an oversupply of 0.4 mb/d, refined products are forecast to draw by a counter-seasonal 0.4 mb/d, in part due to the hurricane outages in the US Gulf Coast. The draw accelerates in 4Q17 and is double the size of our headline total oil balances.

OilPrice Intelligence Report: Is $50 Oil The New Normal?: OPEC met on Friday to consider the possibility of extending the production cuts beyond March 2018. The meeting was uneventful, with no decision taken in regard to recommendations on extending or deepening the production cut deal. The recent uptick in oil prices will provide OPEC members with a bit of confidence as they sort out their next steps, but pitfalls remain for 2018. “The bull run in the oil market is running out of steam as unease builds” Stephen Brennock, analyst at London brokerage PVM Oil Associates, told Reuters on Thursday. While oil markets did not react too negatively to the lack of news, all eyes will be on OPEC as the production cut deal nears its agreed upon deadline. In preparation for its IPO next year, Saudi Aramco is stepping up its oil trading arm, buying and selling oil produced outside of Saudi Arabia. Crude marketing and refined product trading will fall under the same unit, Bloomberg reports. “We’ll keep selling our own oil as normal, and we want to get into trading third-party crude,” Ibrahim Al-Buainain, who will head the expanded unit, told Bloomberg. Aramco is hoping to get into a business that the international oil majors are already involved in. . Bloomberg Gadfly points out that some large oil companies are trapped between pure-play E&Ps and the absolute largest oil companies, offering up a rather unappetizing opportunity for investors. Companies like Anadarko (NYSE: APC) are too large to offer the huge upside potential that small shale drillers have, but they are also not as safe as the likes of ExxonMobil (NYSE: XOM), leaving them with a tricky investment case. As such, the share price of Anadarko has sagged, and in fact, the company just decided buy back shares as a way of appeasing restless investors. Bloomberg Gadfly suggests Anadarko’s predicament is illustrative of a broader problem with oil companies of similar size, who are posting disappointing cash flow figures as they drill more and grow larger. . The EIA reported another significant drawdown in gasoline stocks, which is in part due to the lingering refinery outages in Texas, but also because demand is proving to be robust. U.S. gasoline stocks are now well within the five-year range, and globally, OECD refined product stocks are closing in on five-year averages. Refineries around the world are going to need to pick up the pace, which means crude drawdowns should be forthcoming. “If OPEC is really still willing to commit to extending production cuts, that gives this market some room to test the upside here,” Rob Haworth of U.S. Bank Wealth Management, told Bloomberg.

Oil Steady At $50 Amid Falling U.S. Oil Rig Count - The number of active oil and gas rigs in the United States fell this week by 1 rig.  The total oil and gas rig count in the United States now stands at 935 rigs, up 424 rigs from the year prior, with the number of oil rigs in the United States decreasing by 5 this week and the number of natural gas rigs increasing by 4. Canada’s rig count additions appears to be leveling off, and despite its large swings in the number of active rigs on a weekly basis, has roughly the same number of oil rigs in operation that it had back at the end of July. Canada’s natural gas rigs, on the other hand, are still upwardly mobile, climbing by almost 30 rigs since mid-June. This week, Canada added 10 oil rigs for the week ending September 22, and lost 2 gas rigs.Oil rigs in the United States now number 744—326 rigs above this time last year. Although the number of oil rigs are still up significantly year on year, the increases slowed in the Q2 2017, and have reversed in Q3. The first quarter 2017 saw 137 oil rigs added in the United States, while the second quarter 2017 saw 97 rigs added. In stark contrast, the third quarter, for which there is still one week to go, has seen the total number of rigs decrease by 12. The signs are clear—US drillers are no longer adding rigs at breakneck paces, despite the rise in oil prices.The spot price for WTI fell earlier on Friday, down 0.12% to $50.49 at 12:10pm. Brent crude, however, was trading up 0.18% on the day at $56.53—the second week in a row that Brent was up while WTI was down.All eyes are on OPEC as well as the Baker Hughes rig count today, and while OPEC has concluded its meeting, it has left the market wanting. Both Russia and OPEC, post-meeting, assured the market that it had won the battle over the oil glut, but pushed out until November the decision on whether it should extend the production cuts beyond March 2018. The disappointment from the lack of decision regarding the output cut was tempered as few expected such decisive action. What little disappointment did exist was likely already priced into the market. Both OPEC and Russia added that they were about halfway finished with clearing the global oil glut, and encouraged members to remain vigilant and set upon their task of reining in production. At 10 minutes after the hour, WTI was trading at $50.46 with Brent crude trading at $56.60—both up from last week.

Baker Hughes: US rig count drops for sixth time in 8 weeks - Oil & Gas Journal: The US rig count during the week ended Sept. 22 declined for the sixth time in 8 weeks, again anchored by a drop in oil-directed rigs.Baker Hughes’ overall tally of active rigs in the US edged down a unit to 935, down 23 units since a peak of the drilling rebound on July 28 (OGJ Online, Sept. 15, 2017). The count is still up 531 units from a modern-day bottom in Baker Hughes data during the weeks ended May 20-27, 2016. US oil-directed rigs dropped by 5 to 744, down 22 units since Aug. 11 and up 428 units since May 27, 2016. That loss was mostly offset by a 4-unit gain in gas-directed rigs to 190, their second-highest total since 2015. The highest occurred on July 28. One rig considered unclassified remains drilling. Two onshore rigs went offline, with rigs engaged in horizontal drilling losing 5 units to 790, down 20 units since July 28 and up 476 since May 27, 2016. Rigs drilling directionally increased 3 units to 77. The count of rigs drilling in inland waters dropped by 1 to 3. Two rigs started work offshore Louisiana, bringing the overall US offshore count to 19. The offshore gain propelled Louisiana to No. 1 among the major oil- and gas-producing states in increases. Up 3 units this week, Louisiana now has 65 rigs working. Texas, New Mexico, and Alaska each rose a unit to 453, 68, and 5, respectively. [Native Advertisement] Despite losses in most of the other major oil and gas regions, the Permian spiked 6 units to 386, its highest point since Feb. 6, 2015. Since its low point in recent Baker Hughes data on May 13, 2016, the Permian has risen 252 units. Permian growth, however, has slowed since the beginning of the summer. The Eagle Ford dropped 3 units to 68, down 18 units since the peak of its rebound on June 2. The Haynesville and Granite Wash each lost a unit to respective counts of 45 and 14. Colorado and the DJ-Niobrara each fell 2 units to 33 and 26, respectively. Oklahoma and North Dakota each declined 3 units to respective totals of 127 and 49. The Cana Woodford edged down 1 to 63, while the Arkoma Woodford gained 1 unit to 9. As with its home state, the Williston fell 3 units to 49. The Cana Woodford and Williston are yet to take big losses during the recent US drilling decline.

 Mission accomplished? OPEC banishes contango: John Kemp - (Reuters) - “There is no doubt that the oil market is moving in the right direction,” the Organization of the Petroleum Exporting Countries noted with satisfaction in its most recent bulletin published on Wednesday.“The rebalancing process was never going to happen overnight; it was never going to happen in a linear fashion; and it was always going to require a concerted effort,” OPEC observed.“Patience and perseverance are still required”, the bulletin warned, but the organisation is well on the way to achieving the objectives it set when announcing output cuts in November 2016.Reported oil inventories in the advanced economies have begun to decline towards their five-year average while oil stored at sea and in remote locations has also fallen sharply.Contango, a symptom of an oversupplied market, has gradually disappeared from most crude markets to be replaced by backwardation, a sign of tightness (http://tmsnrt.rs/2jKOQSM).OPEC has often stated that it wants to see the contango narrow as part of the rebalancing process.Contango enables traders to profit from storing crude in excess of their immediate operational requirements by selling oil for deferred delivery at prices above the spot market.So its disappearance has coincided with an accelerated draw down in inventories held in floating storage and in onshore tanks.Crude in floating storage has fallen by 30 million barrels since the start of the year, according to industry sources surveyed by OPEC.Paris-based cargo tracking firm Kpler estimates floating storage has fallen sharply in recent weeks to the lowest level for more than two years.Oil traders are also emptying one of the world’s largest onshore crude storage facilities at Saldanha Bay in South Africa, according to Bloomberg. Global crude stocks are gradually being drawn towards the major refining centres as the surplus inherited from 2015-2016 is absorbed.

Aramco Plans to Buy Non-Saudi Crude in Global Trading Expansion --Saudi Aramco plans to expand its trading business by buying and selling non-Saudi crude as the world’s biggest exporter prepares for what could be a record initial public offering.The state-owned company is putting crude marketing and refined-product trading under the same management, according to Ibrahim Al-Buainain, chief executive officer of Saudi Aramco Products Trading Co. The enlarged unit will trade crude that it doesn’t own, helping Saudi Aramco supply refineries more efficiently and make more profit, he said.“We’ll keep selling our own oil as normal, and we want to get into trading third-party crude,” Al-Buainain, who will head the expanded unit, said in an interview in Fujairah in the United Arab Emirates. Aramco, known formally as Saudi Arabian Oil Co., is joining other state-controlled oil companies in taking a greater interest in trading crude and not just supplying it. The move comes as the kingdom prepares to sell about 5 percent of Aramco. The government has previously said the valuation may reach $2 trillion, while analysts, including those at Sanford C. Bernstein & Co. and Rystad Energy AS, have tended to give lower estimates.

Saudis May Hike Domestic Gasoline Prices by 80% -  Saudi Arabia is considering a plan to phase out subsidies for gasoline and jet fuel in November at the latest, as the world’s biggest oil exporter pushes a program to curtail spending after a global slump in prices. The government would boost gasoline to parity with varying international prices under the plan, according to a person with knowledge of the matter. At current levels, this could result in a hike of about 80 percent for octane-91 grade gasoline to about 1.35 riyals per liter (0.36 cents), the person said on condition of anonymity. The government plans to delay increases in other energy prices until early 2018, the person said. Authorities are expected to make a final decision on the plan in September or October, the person said. The Saudi finance, economy and energy ministries didn’t immediately respond to requests for comment. Energy-subsidy reform is a key part of Saudi Arabia’s plan to overhaul the economy, along with the sale of stakes in state-owned entities, including the world’s biggest crude exporter known as Saudi Aramco. The kingdom raised fuel prices in December 2015 and announced plans for further increases. Authorities have also announced plans for a cash transfer program that would start before further subsidy cuts to help Saudis cope with the impact as the economy struggles with the worst slowdown since the global financial crisis. “It is important for the Saudi government to cut subsidies in order to ease pressures on budget deficit,” “Not only the transportation and logistics sectors will be affected significantly, any company that is involved in production and needs to transfer their end products to consumers will be affected.” 

Saudi Arabia Cracks Down on Dissenting Clerics Amid Rumors of Crown Prince’s Rise to Throne - Saudi Arabia arrested a trio of prominent clerics last weekend, a sign that the kingdom may be preparing for the formal ascendance of Crown Prince Mohammed bin Salman, known as MBS, who is a key decision-maker on the country’s domestic and international affairs but is technically subservient to his father, King Salman. Salman al-Odah, Awad al-Qarni, and Ali al-Omary were arrested with little explanation over the weekend, but activists suspect that their failure to follow MBS’s hawkish line on Qatar played a role in their imprisonment. Human rights activists told the Wall Street Journal that Odah’s arrest came after he declined to come out in support of the Saudi government’s actions against Qatar. On September 8, Odah tweeted a fairly banal message hoping for reconciliation between the kingdom and Qatar. “May God harmonize between their hearts for the good of their people,” he wrote: Odah, who has 14 million followers, has not tweeted since September 9, the day he was swept up with the others. “The Qatar crisis, a tribal dispute with potential global implications, is a key reason. This ‘kerfuffle’ is now very serious. MBS is showing that he can clean house in terms of those who may express sympathy to any opening of dialogue thru the new Saudi State Security Presidium,” Ted Karasik, a senior adviser at Gulf State Analytics who has spent years in the region, told The Intercept in an email. “Importantly, the cleavage between Qatar and the ATQ is now directly impacting Saudi society — the arrests were across a broad swath of clerics, poets and television personalities,” Karasik added, referring to the Anti-Terror Quartet, a name used to refer to Saudi Arabia, the United Arab Emirates, Bahrain, and Egypt, the four countries that initiated the months-long blockade of Qatar. “Thus, some may say these arrests are a purge.”

Yemen’s Appalling Cholera Epidemic Keeps Getting Worse - The World Health Organization (WHO) reports that there are now more than 680,000 suspected cases of cholera, an increase of 40,000 in just the last week:In Yemen, the most explosive outbreak on record has caused 686,783 suspected cases and 2,090 deaths since late April. The number of deaths has slowed but the spread of disease has not: in the past week there were 40,000 suspected cases, the most for seven weeks.Last week, I wrote about the Red Cross’ projection that there could be as many as 850,000 cases of cholera by the end of the year. In that post, I noted that the final figure would likely be much higher because the epidemic is spreading much more quickly than anticipated. Five days later, the number of cases is already closing in on 700,000. If the number of new cases keeps growing like this, there could easily be over a million by the start of 2018.Yemen’s cholera epidemic was already the worst on record two months ago, and it had become the worst contemporary epidemic of its kind a few weeks before that. In the months that have followed, the spread of the epidemic has not slowed, and it continues to spread more quickly than expected. If the latest report is any indication, the spread of the epidemic is faster than before. While we can be grateful that the number of deaths has so far remained low, that should not make us ignore the vast scale of Yemen’s cholera crisis, especially since it is paired with the world’s worst hunger crisis. All of this is a man-made crisis, and it has been produced by a war that the Saudi-led coalition needlessly escalated two and a half years ago with Washington’s approval and full support. The U.S. and Britain, among others, have been arming and fueling the coalition war effort, including an indiscriminate bombing campaign that has wreaked havoc on infrastructure and health care facilities, and they have supported the coalition blockade that continues to starve Yemenis and deprive them of basic necessities.

As Cholera-Wracked Yemen Starves, Saudis Paint Rosy Picture of Their Relief Efforts - Saudi Arabia’s king sent a senior advisor to the United States this week to paint a picture of a generous nation working to ensure food and medicine reaches the suffering civilians of Yemen, even as it pursues a devastating air war against Houthi rebels. But international relief organizations, human rights advocates, and a growing number of U.S. lawmakers say Saudi Arabia and its military partners are aggravating the mounting humanitarian catastrophe in Yemen by delaying or blocking access for emergency aid to areas controlled by Houthis, including a crucial port and the country’s airport.At public events on Wednesday and Thursday in Washington, Abdullah Al Rabeeah, the director of the country’s main aid organization, offered a different version of Riyadh’s actions in Yemen that flew in the face of accounts from U.N and U.S. officials and aid workers. “We have proven to our partners that we are impartial in our work in Yemen,” said Rabeeah, who handed out charts and a brochure detailing Riyadh’s relief work. But U.N. officials say Yemen represents the world’s largest humanitarian crisis, with nearly seven million civilians on the brink of starvation and a record-setting cholera outbreak affecting more than 600,000 people. Much to the frustration of aid organizations, the Saudi-led coalition has barred relief flights into Yemen’s airport and blocked the delivery of four large cranes to the port of Hodeida that could move food and medical supplies off of cargo ships on a much larger scale. “We need Yemen’s airspace, its airport, and its main sea port reopened urgently,” said Ruairidh Villar, spokesperson for the London-based charity Save the Children. “If the cranes were able to operate at Hodeida, it is undeniable that the flow of humanitarian aid and medical supplies, food and fuel, could restart again at a much higher level than we are currently seeing,” Villar said. 

Good news from Syria -- "The US and Russia rejected an Israeli request to prevent the presence of any Iranian forces or Iranian-backed militias near the Israeli border as a part of the ceasefire agreement in south Syria, the Israeli Haaretz newspaper reported on Thursday.According to the report, Israel demanded to create a 60-80km wide buffer zone inside Syria against Iranian-backed forces. The supposed buffer zone would spread from the Golan Heights to the west of the Damascus-al-Suwayda highway in southwestern Syria.Israel proposed its idea to Russia and the US during the talks that preceded the cease-fire agreement in southern Syria. According to the report, Russia refused the Israeli proposal, while the US didn’t back it for real mostly. However, Russia promised Israel that the Iranians and their allies will not move any closer to Israel than five kilometers in the areas held by the Syrian government. The report noted that no Iranian presence was notified on the frontline with Syria for months now."  SF 

The Race For Deir Ezzor: Russian Jets Strike US-Backed Forces In Syria --One week ago we wrote that in "The Race For Deir Ezzor: US And Syrian Forces Are About To Collide", explaining that "as ISIS continues to rapidly collapse in its last two strongholds (Raqqa and Deir Ezzor cities), the competition for recovery of territory seems in full gear between the US-SDF and Syria-Russia alliances." More importantly, "Deir Ezzor province happens to be Syria's most oil-rich territory, which means the future of some of Syria's largest oil fields remains up for grabs." Furthermore, we added that "it looks increasingly like US-backed SDF forces and the Syrian Army could be set to clash as both roll back ISIS lines from either side of the Euphrates.  One week later, that's precisely what happened, and overnight we got the first glimpse of just what this next stage of the Syria proxy war, now largely devoid of ISIS, will look like, when according to Reuters "U.S.-backed militias", which have included various and assorted Al-Qaeda offshots, spinoffs and reverse mergers, said they came under attack on Saturday from Russian jets and Syrian government forces in Deir al-Zor province. The Syrian Democratic Forces - an alliance of Kurdish and Arab militias fighting with the U.S.-led military coalition -  said the strikes wounded six of its fighters. In a statement carried by Reuters, the SDF said that "our forces east of the Euphrates were hit with an attack from the Russian aircraft and Syrian regime forces, targeting our units in the industrial zone."

Syria – Russia Accusing U.S. of Attacks, Abduction Attempts, Team-play With Al-Qaeda - The situation in Syria is reaching another critical point. There is an increased possibility of a large scale clash between U.S. and Russian forces. We had warned of such a clash over control of the rich fields east of Deir Ezzor. At least three incidents over the last days point to more significant escalations.

  • On the 17th the U.S. accused Russia of a light air attack on its proxy forces north of Deir Ezzor. Russia denied that it had attacked those forces.
  • On the 18th and 19th large contingents of Russian and Syrian troops crossed the Euphrates at Deir Ezzor in east-Syria. The U.S. Kurdish/Arab proxy force in the area actively tried to hinder that movement.
  • In parallel a large al-Qaeda attack was launched in west-Syria. The Russian forces accuse U.S. intelligence services of having initiated that campaign. (The Syrian-Russian forces defeated the attack.)
  • Today the Russian military accused the U.S. Kurdish proxies near Deir Ezzor of firing artillery on its forces. It threatened massive retaliation.

The most dramatic incident was the al-Qaeda attack in Idleb.Al-Qaeda in Syria, renamed to Hay'at Tahrir al-Sham, currently controls Idleb governate and Idleb city in north-west Syria. On September 19 it launched a large scale attack on Syrian government positions in north Hama, south of Idleb provinces. The al-Qaeda forces gained significant grounds before being stopped and forced to retreat. Nearly all the heavy weapons, tanks and artillery, that al-Qaeda had in the area were used and in the attack.The spokesperson of the Russian military said (vid with English subtitles) that, according to Russian intelligence reports, al-Qaeda's attack was made on behalf of the U.S. to slow down the Syrian-Russian campaign in the eastern province Deir Ezzor. A subtask for the terrorists was to capture a platoon of Russian soldiers. This is, to my knowledge, the first time that Russia made such a direct and extremely grave accusation against the U.S. forces and intelligence services in Syria.

Russian Special Forces Repel a US-Planned Attack in Syria, Denounce the USA and Issue a Stark Warning - Something rather unprecedented just happened in Syria: US backed “good terrorist” forces attempted a surprise attack against Syrian government forces stationed to the north and northeast of the city of Hama.  What makes this attack unique is that it took place inside a so-called “de-escalation zone” and that it appears that one of the key goals of the attack was to encircle in a pincer-movement and subsequently capture a platoon of Russian military police officers deployed to monitor and enforce the special status of this zone.  The Russian military police forces, composed mainly of soldiers from the Caucasus region, fought against a much larger enemy force and had to call for assistance.  For the first time, at least officially, Russian special operations forces were deployed to rescue and extract their comrades.  At the same time, the Russians sent in a number of close air support aircraft who reportedly killed several hundred “good” terrorists and beat back the attack (Russian sources speak of the destruction of 850 fighters, 11 tanks, three infantry fighting vehicles, 46 armed pickup trucks, five mortars, 20 freighter trucks and 38 ammo supply points; you can see photos of the destroyed personnel and equipment here).  What also makes this event unique is the official reaction of the Russians to this event. Head of the Main Operations Department at Russia’s General Staff Colonel General Sergei Rudskoi declared that: “Despite agreements signed in Astana on September 15, gunmen of Jabhat al-Nusra and joining them units that don’t want to comply with the cessation of hostilities terms, launched a large-scale offensive against positions of government troops north and northeast of Hama in Idlib de-escalation zone from 8 am on September 19 (…) According to available data, the offensive was initiated by American intelligence services to stop a successful advance of government troops east of Deir ez-Zor“.Today, other Russian officials have added a not-so-veiled threat to this accusation.  The Russian Defense Ministry’s spokesman, Major General Igor Konashenkov has declared that:Russia unequivocally told the commanders of US forces in Al Udeid Airbase (Qatar) that it will not tolerate any shelling from the areas where the SDF are stationed (…)  Fire from positions in regions [controlled by the SDF] will be suppressed by all means necessary. This is unprecedented on many levels.  First, the Russians clearly believe that this attempt to kill or capture a platoon of the Russian military police was planned by the United States.  The fact that they are making this accusation officially shows the degree of irritation felt by the Russians about the duplicity of the Americans.  Second, this is the first time, at least to my knowledge, that Russian Spetsnaz forces had to be sent in to rescue a surrounded Russian subunit. 

Russia Warns US In Unprecedented "Secret" Face-To-Face Meeting Over Syria, But What's The Endgame? --  The moment the first Russian jet landed in Syria at the invitation of the Assad government in 2015, Putin placed himself in the driver's seat concerning the international proxy war in the Levant. From a strategic standpoint the armed opposition stood no chance of ever tipping the scales against Damascus from that moment onward. And though US relations with Russia became more belligerent and tense partly as a result of that intervention, it meant that Russia would set the terms of how the war would ultimately wind down.  Russia's diplomatic and strategic victory in the Middle East was made clear this week as news broke of "secret" and unprecedented US-Russia face to face talks on Syria. The Russians reportedly issued a stern warning to the US military, saying that it will respond in force should the Syrian Army or Russian assets come under fire by US proxies. The AP reports that senior military officials from both countries met in an undisclosed location "somewhere in the Middle East" in order to discuss spheres of operation in Syria and how to avoid the potential for a direct clash of forces. Tensions have escalated in the past two weeks as the Syrian Army in tandem with Russian special forces are now set to fully liberate Deir Ezzor city, while at the same time the US-backed SDF (the Arab-Kurdish coalition, "Syrian Democratic Forces") - advised by American special forces - is advancing on the other side of the Euphrates. As we've explained before, the US is not fundamentally motivated in its "race for Deir Ezzor province" by defeat of ISIS terrorism, but in truth by control of the eastern province's oil fields. Whatever oil fields the SDF can gain control of in the wake of Islamic State's retreat will then used as powerful bargaining leverage in negotiating a post-ISIS Syria. The Kurdish and Arab coalition just this week captured Tabiyeh and al-Isba oil and gas fields northeast of Deir Ezzor city.

Israel Strikes Damascus After Syrian Missile Defense Fires On Aircraft -- For the third time in as many weeks Israel has reportedly bombed positions inside Syria. Syrian state media along with multiple regional outlets showed fires burning at a facility near the Damascus international airport in the early hours of Friday. Israeli newspaperHaaretz reports that like with previous attacks, Israel jets fired from over Lebanese airspace. But it appears the latest exchange was part of a tit-for-tat exchange of fire between Syria and Israel in a situation that continues to dangerously escalate. Multiple reports are circulating that the Israeli attack was initiated after Syria's aerial defense missile system engaged and fired on an Israeli aircraft in the area. Video of what purports to show Syrian missiles firing on the aircraft circulated widely in Syrian social media and was picked up by Lebanese and Israeli news outlets. Early reports indicate that an Israeli drone was likely the target. #Syrian air defense downing an #Israeli drone over #Syria tonight.pic.twitter.com/yWCKZSzrCR— Hamosh (@Hamosh84) September 22, 2017It appears that Israel's attack came in response to Syria's engaging the unidentified aircraft - though it's unclear if the target was hit. This latest incident is unique for the fact that Syria quickly publicized that its missile defense system engaged the Israeli target. The Facebook page of a prominent Syrian pro-government militia reported in the early morning hours that, “an area near the Damascus international airport was attacked by a hostile missile." Israeli newspapers are claiming the site to be an ammunition storage depot.

 Pressure Mounts on Iraqi Kurds to Cancel Independence Vote - NYT — In a region where few people concur on anything, adversaries and enemies in the Middle East find themselves agreeing on one goal: to stop Iraq’s Kurds from forging ahead with a vote for independence on Monday.As the Kurds rush headlong to embrace their region’s first steps toward independence, their neighbors and allies, led by the United States, are ratcheting up demands to cancel a referendum on independence from Iraq. They warn that it could unleash ethnic violence, tear Iraq apart and fracture the American-led coalition fighting Islamic state militants.It is difficult to reconcile the fierce international objections with the euphoric flag-waving celebrations in Kurdish cities, where residents are convinced they will be voting for independence next week no matter what the world thinks. In Erbil, the capital of Iraqi Kurdistan, fireworks streak across night skies and young men cruise past in cars, honking horns and chanting Kurdish national slogans. Red-white-and-green Kurdish flags snap in the wind beside posters and banners that implore Kurds – in four languages – to vote “yes” to pursue independence. But almost every day for the past week, Kurds have been buffeted by jarring new demands from outside their autonomous enclave to cancel the vote. The White House has called the vote “provocative and destabilizing.” Brett H. McGurk, the United States envoy to the region, has described it as “a very risky process” with “no prospect for international legitimacy.”

Digging In for Next Decade, U.S. Expands Kabul Security Zone - NYT — Soon, American Embassy employees in Kabul will no longer need to take a Chinook helicopter ride to cross the street to a military base less than 100 yards outside the present Green Zone security district. Instead, the boundaries of the Green Zone will be redrawn to include that base, known as the Kabul City Compound, formerly the headquarters for American Special Operations forces in the capital. The zone is separated from the rest of the city by a network of police, military and private security checkpoints. The expansion is part of a huge public works project that over the next two years will reshape the center of this city of five million to bring nearly all Western embassies, major government ministries, and NATO and American military headquarters within the protected area. After 16 years of American presence in Kabul, it is a stark acknowledgment that even the city’s central districts have become too difficult to defend from Taliban bombings. But the capital project is also clearly taking place to protect another long-term American investment: Along with an increase in troops to a reported 15,000, from around 11,000 at the moment, the Trump administration’s new strategy for Afghanistan is likely to keep the military in place well into the 2020s, even by the most conservative estimates. No one wants to say when any final pullout will take place, because the emphasis now is on a conditions-based withdrawal — presumably meaning after the Afghan government can handle the war alone. But President Trump has kept secret the details of those conditions, and how they are defined.

 Taiwan Cuts Off Fossil Fuels To North Korea - Taiwan will no longer offer its fossil fuels to North Korea, the island announced on Tuesday in a bid to emerge as a responsible member of the international community. Taiwan also said it would immediately halt any remaining clothing and textile imports from North Korea, in line with recent economic sanctions against Pyongyang for its missile tests over Japan. Preexisting contracts in force before September 11th would continue to be honored until December 10th, a notice from the economics ministry said.The bans hope to “denounce North Korea’s recent successive nuclear tests and actions that jeopardize regional security,” the economics ministry said in a statement.The island is not officially a member of the United Nations apart from Beijing, which insists Taiwan is just one of China’s provinces.Taiwan and North Korea have seen bilateral trade fall 90 percent in volume in the first six months of this year, compared to the year prior. This is mostly due to the increasing scope of punitive sanctions against Pyongyang in recent months.Russia and China have previously made a commitment never to support sanctions against Pyongyang that could negatively impact the civilian population, a stance that would almost certainly include a full-scale oil embargo. Even prior to the new threat of sanctions, North Korea has been increasingly self-sufficient in beginning to tap its still largely unused oil reserves. However, the country’s political climate, including the sanctions currently in force, and water depths of up to 2,500 meters off the east coast present barriers to development. A shortage of funds is likely to further hamper development.

China limits oil trade to North Korea and bans textile trade - China has moved to limit North Korea's oil supply and will stop buying textiles from the politically isolated nation, it said on Saturday. China is North Korea's most important trading partner, and one of its only sources of hard currency. The ban on textiles trade will hurt Pyongyang's income, while China's oil exports are the country's main source of petroleum products. The tougher stance follows North Korea's latest nuclear test this month. The United Nations agreed fresh sanctions - including the textiles and petroleum restrictions - in response. A statement from China's commerce ministry said restrictions on refined petroleum products would apply from 1 October, and on liquefied natural gas immediately. Under the UN resolution, China will still be able to export a maximum of two million barrels of refined petroleum to North Korea annually, beginning next year. North Korea is estimated to have imported 6,000 barrels of refined petroleum daily from China in 2016 - the equivalent of nearly 2.2 million in total for the entire year. But China has not published data on oil exports since 2014. The ban on textiles - Pyongyang's second-biggest export - is expected to cost the country more than $700m (£530m) a year. 

China is getting tougher on North Korea—to stop the US from getting tougher on it - Soon after North Korea sent another missile over Japan Friday morning (Sept. 15), US secretary of state Rex Tillerson called on China and Russia to take stronger action on their own against North Korea. When it comes to China, that might already be happening.Around the time the US was agreeing to leave a full oil embargo out of the latest sanctions on North Korea, viewed as a concession to China and Russia, news reports out of Beijing said that the biggest state banks had been ordered to stop opening new accounts for North Korean individuals and entities. The Chinese measures, reported by various publications including the Financial Times (paywall) and South Korea’s Daily NK news site, go further than current UN sanctions, which, while well short of what the US wanted, should see some reduction in the supply of energy products to North Korea. China’s bottom-line position on North Korea is that it’s not going to allow chaos on its doorstep, whether that’s a brutal war or a refugee crisis. It has long pushed for a return to talks, and for the US and South Korea to barter an end to their joint military exercises for North Korea to cease testing. But, North Korea’s frequent weapons tests, coinciding with big events in China, haven’t helped the relationship any. Meanwhile the US is keeping the pressure up on China.For China, that means getting tougher on North Korea—but not overly tough. “Beijing wants to teach North Korea a lesson without causing its collapse,” said Zhang Baohui, director of the Center for Asian Pacific Studies at Hong Kong’s Lingnan University. “These do show some changes in China’s thinking about North Korea as the sanctions are unprecedented.”

In "Warning To Pyongyang", B-1B Bombers, F-35s Hold Mock Bombing Drills -- A day after US ambassador to the United Nations Nikki Haley admitted that with the latest round of sanctions the Security Council has just about reached the limits of China’s and Russia’s tolerance – and that the US will now need to explore other diplomatic, and possibly military, options, US forces joined with their South Korea counterparts for another "show of strength" meant for North Korea. Both Haley and US Secretary of State Rex Tillerson appeared on the Sunday talk shows to stress – using language that’s ringing increasingly hollow - that the administration wouldn’t hesitate to authorize a military response to the North should diplomacy fail.And to demonstrate that, four US F-35 stealth fighters and two B-1B bombers conducted another round of "mock bombing exercises" over the Korean peninsula on Monday,according to Reuters. The US aircraft, which were joined by four South Korea F-15K fighter jets, returned to their bases in Japan and Guam after the exercise, but the latest demonstration of western capabilities likely assures that Kim Jong Un, who views such exercises in the same way the international community views his missile launches, will seek to retaliate with his own show of force.

South Korea Unexpectedly Approves Aid To Pyongyang As North Korea Calls Trump "Barking Dog" -- There is no love lost in the endlessly escalating war of words and delightful soundbites between Trump and North Korea, and after the President threatened to “totally destroy” North Korea, the country's foreign minister said Trump's UN speech amounted to “the sound of a dog barking,” adding that Trump’s warnings are just a nonsensical “dog dream."  “If he was thinking he could scare us with the sound of a dog barking, that's really a dog dream,” North Korean Foreign Minister Ri Yong-ho told reporters in New York on Wednesday, as cited by the Yonhap news agency. Along with other world diplomats, Ri was in New York to attend the UN General Assembly. In his debut speech to the UN on Tuesday, Trump vowed to "totally destroy" North Korea if the US was forced to defend its allies. Referring North Korean leader Kim Jong Un by a nickname he first used in in a tweet Sunday, Trump said: "Rocket man is on a suicide mission for himself and for his regime."Responding to Trump’s new nickname for North Korean leader Kim Jong-un, 'Rocket Man', Ri said: “I feel sorry for his aides.”North Korean diplomats were not present for Trump's speech.According to CNN, US Secretary of State Rex Tillerson, who is also in New York, played down the possibility of a meeting with his North Korean counterpart. Pyongyang and Washington do not maintain formal diplomatic relations and the presence of North Korea's top diplomat in the US could have afforded a rare chance for high-level, face-to-face dialogue. Tillerson told reporters he did not believe he could have a "matter-of-fact discussion with North Korea because we don't know how their means of communication and behavior will be.

The cold, calculated logic behind North Korea’s missile tests | South China Morning Post: North Korea did it again. Within two weeks of a test of what it claimed to be hydrogen bomb – an act that earned its second round of United Nations sanctions in just two months – it launched another intermediate-range ballistic missile over Japan. Compared to its first overflight in August, the missile flew higher and longer.  These missiles are designed to deliver nuclear warheads to military targets in East Asia and the Pacific. Notably, North Korea envisages using these weapons to strike the US territory of Guam early in a war. Its state propaganda regularly bemoans the presence of the US Pacific Command’s strategic bomber fleet on the island at Andersen Air Force Base.  . Kim Jong-un’s actions, while provocative, are both rational and win him and his scientists important technical insights and improve the credibility of North Korea’s strategic deterrent. On a technical level, these kinds of long-range ballistic missile tests allow North Korea to prove the performance of its long-range missiles on trajectories more similar to what they’d encounter during operational use.That brings us to the strategic utility of these ballistic missile tests – North Korea intends to drive a wedge between the United States and its allies. On the one hand, its long-range missiles, capable of reaching even the mainland United States, bring to the fore the old cold war problem of “decoupling” in East Asia. By placing Los Angeles and Chicago at risk, North Korea considerably increases the difficulty of the United States’ task in reassuring nations in East Asia of their safety. Moreover, North Korea, in its state-run media, has repeatedly invited the United States and South Korea to modify their military exercises in exchange for a potential slowdown or cessation of ballistic missile testing. For Japan the implication is clear, too. North Korean provocations that place its territory under direct threat are continuing precisely because the United States continues to maintain a forward presence on the Korean peninsula. The latest launch was intended to showcase that expanding UN Security Council sanctions would do little to stop Pyongyang 

China calls for peace talks to halt ‘vicious cycle’ in North Korean nuclear crisis | South China Morning Post: The vicious cycle facing the Korean peninsula was deepening and a resumption of peaceful dialogue was crucial to resolve the crisis, China’s Foreign Minister Wang Yi warned on Monday. Wang made the remarks in talks with his Russian counterpart Sergey Lavrov on the sidelines of the United Nations General Assembly in New York. US President Donald Trump is expected to press China and Russia to exert more pressure to force North Korea to stop its nuclear ambitions. China and Russia – both permanent members of the UN Security Council – voted for the new sanctions against North Korea last week, but they are both against tough measures that will topple Kim Jong-un’s regime and agreed to cooperate over the matter. “The current deepening vicious cycle must be broken. Resuming peace talks is an equally important step in implementing Security Council resolutions,” Wang was quoted as saying in a Chinese foreign ministry statement. China’s “suspension-for-suspension” proposal, whereby the United States and South Korea would agree to halt joint military drills while North Korea halted missile and nuclear tests, was a practical step to resolve the crisis, Wang said.

The Russia-China plan for North Korea: stability, connectivity - Pepe Escobar  -- The United Nations Security Council’s 15-0 vote to impose a new set of sanctions on North Korea somewhat disguises the critical role played by the Russia-China strategic partnership, the “RC” at the core of the BRICS group. The new sanctions are pretty harsh. They include a 30% reduction on crude and refined oil exports to the DPRK; a ban on exports of natural gas; a ban on all North Korean textile exports (which have brought in US$760 million on average over the past three years); and a worldwide ban on new work permits for DPRK citizens (there are over 90,000 currently working abroad.) But this is far from what US President Donald Trump’s administration was aiming at, according to the draft Security Council resolution leaked last week. That included an asset freeze and travel ban on Kim Jong-un and other designated DPRK officials, and covered additional “WMD-related items,” Iraqi sanctions-style. It also authorized UN member states to interdict and inspect North Korean vessels in international waters (which amounts to a declaration of war); and, last but not least, a total oil embargo. “RC” made it clear it would veto the resolution under these terms. Russian Foreign Minister Sergey Lavrov told the US’ diminishing Secretary of State Rex Tillerson Moscow would only accept language related to “political and diplomatic tools to seek peaceful ways of resolution.” On the oil embargo, President Vladimir Putin said, “cutting off the oil supply to North Korea may harm people in hospitals or other ordinary citizens.”“RC” priorities are clear: “stability” in Pyongyang; no regime change; no drastic alteration of the geopolitical chessboard; no massive refugee crisis. 

S&P Cuts China’s Credit Rating, Citing Risk From Debt Growth - S&P Global Ratings cut China’s sovereign credit rating for the first time since 1999, citing the risks from soaring debt, and revised its outlook to stable from negative.The sovereign rating was cut by one step, to A+ from AA-, the company said in a statement late Thursday. The analysts also lowered their rating on three foreign banks that primarily operate in China, saying HSBC China, Hang Seng China and DBS Bank China Ltd. would be unlikely to avoid default should the nation default on its sovereign debt.“China’s prolonged period of strong credit growth has increased its economic and financial risks,” S&P said. “Although this credit growth had contributed to strong real gross domestic product growth and higher asset prices, we believe it has also diminished financial stability to some extent.”The downgrade, the second by a major ratings company this year, represents ebbing international confidence that China can strike a balance between maintaining economic growth and cleaning up its financial sector. The move may also be uncomfortable for Communist Party officials, who are just weeks away from their twice-a-decade leadership reshuffle."It’s bad optics for China, especially when they’re out there from a policy and rhetorical standpoint talking about debt more and acknowledging their debt challenge," said Andrew Polk, co-founder of research firm Trivium China in Beijing. "It may feel like potentially the international community is piling on and that will be frustrating."The Finance Ministry in Beijing didn’t immediately respond to a fax after normal business hours seeking comment on the ratings change. In May, it refuted the downgrade by Moody’s Investors Service, saying the company had overestimated economic difficulties.

China Dollar Dump Means Hyperinflation – Chris Martenson - Resource analyst and futurist Chris Martenson says everyone should be taking notice of our “dangerous markets.” At the center of the danger zone is the declining U.S. dollar.  Martenson explains, “We are talking about a steady erosion of the dollar as a reserve currency.  I think that is most likely.  The only thing that could make that really go fast is some kind of war.  The United States and China, we got to keep our eye on this because Trump has been threatening a trade war with China.  China responded and said if you do that, we may dump the dollar. . . . So, there is all this trade and financial back and forth and maybe even actual war at some point. . . . China has the ability to really impact the dollar in a big way on the world stage.  We better hope it does not come to that because a slow erosion we can adjust to; a quick erosion is going to really roil the markets and maybe blow a few of them up.” Martenson contends the U.S. could see hyperinflation in a short time if China “dumps the dollar.” Martenson explains, “The way that works is let’s say they want to unload $500 billion on some Tuesday morning.  Who is going to buy that $500 billion?  Who is on the other side of that trade?  Well, if there are not enough people bidding for those dollars, the price has to fall until you find enough people to absorb those, and the dollar would fall in value against all other sorts of other things such as other currencies, oil, gold, silver and all those things. . . . We would be looking for a paired event.  What we would be looking for is interest rates starting to rise on Treasuries and the dollar starting to fall in value in value against a variety of things.  Once we see those two things, we know we have a financial war or a monetary war. . . . That’s what blows up the derivatives market.  That’s what makes difficulties for traders.  That’s what makes the high frequency computers say I don’t like this and bolt and instantly evaporate from the markets.”

"Central Banks Are Petrified" Chris Martenson On The Hyperinflationary Threat Of "China Dumping The Dollar" -- Resource analyst and futurist Chris Martenson says everyone should be taking notice of our “dangerous markets.” At the center of the danger zone is the declining U.S. dollar.  Martenson explains, “We are talking about a steady erosion of the dollar as a reserve currency. I think that is most likely.  The only thing that could make that really go fast is some kind of war.  The United States and China, we got to keep our eye on this because Trump has been threatening a trade war with China.  China responded and said if you do that, we may dump the dollar. . . . So, there is all this trade and financial back and forth and maybe even actual war at some point...China has the ability to really impact the dollar in a big way on the world stage. We better hope it does not come to that because a slow erosion we can adjust to; a quick erosion is going to really roil the markets and maybe blow a few of them up.”  Martenson contends the U.S. could see hyperinflation in a short time if China “dumps the dollar.” Martenson explains, “The way that works is let’s say they want to unload $500 billion on some Tuesday morning.  Who is going to buy that $500 billion?  Who is on the other side of that trade? Well, if there are not enough people bidding for those dollars, the price has to fall until you find enough people to absorb those, and the dollar would fall in value against all other sorts of other things such as other currencies, oil, gold, silver and all those things... We would be looking for a paired event.  What we would be looking for is interest rates starting to rise on Treasuries and the dollar starting to fall in value in value against a variety of things.  Once we see those two things, we know we have a financial war or a monetary war... That’s what blows up the derivatives market. That’s what makes difficulties for traders.  That’s what makes the high frequency computers say I don’t like this and bolt and instantly evaporate from the markets.” Martenson also points out, These markets . . . are held together by confidence. . . . I can’t tell you the number of people that used to be investors that say they just don’t trust these markets.  They are rigged and they understand that.  They don’t want any part of that.”

Japan's "Deflationary Mindset" Grows As Household Cash Hordes Reach Record High - After being force-fed more stimulus than John Belushi, and endless rounds of buying any and every asset that dares to expose any cracks in the potemkin village of fiat folly, Japan remains stuck firmly in what Abe feared so many years ago - a "deflationary mindset." As Bloomberg reports, cash and deposits held by Japanese households rose for 42nd straight quarter at the end of June as the nation’s consumers continued to favor saving over spending. The "deflationary mindset" that the Bank of Japan is battling to overcome was also evident in the money laying idle in corporate coffers, which stayed near an all-time high, according to quarterly flow of funds data released by the BOJ on Wednesday. Still, as Bloomberg optimistically notes, with the economy expanding much faster than its potential growth rate, greater inflationary pressures could be on the way, which may prompt a shift in behavior by consumers and companies... or not!

Pakistan Population Boom; Rohingya Ethnic Cleansing - Is Pakistan's growing population a "disaster in the making"? Is it a bigger disaster than the population bust in Europe and East Asia with their aging societies and shrinking labor force? Where will the investment in education, health and job creation come from in Pakistan to meet the growing population? Is there a demographic dividend with Pakistan's labor force growing faster than the overall population? Will growth in labor force help increase domestic savings rate in Pakistan? What is the relationship between GDP growth and job creation? What is Pakistan's employment elasticity relative to other nations in South Asia?  Who are the Rohingya? Why are they being attacked, raped, killed and driven out of their homes in Rakhine state? Why is the Myanmar government and its allied Buddhist militias, including monks, burning Rohingya villages? Is it a "textbook example of ethnic cleansing" as described by the UN Human Rights chief? Why is Nobel Peace laureate Myanmar leader Aung San Suu Kyi defending these actions instead of using her authority, at least her moral authority, to end this nightmare for the Rohingya? What is the world doing about t? What can and should Pakistan and other Muslim nations do to help their fellow Muslim Rohingya?  Viewpoint From Overseas host Misbah Azam discusses these and other questions with panelists Ali H. Cemendtaur and Riaz Haq (www.riazhaq.com) https://youtu.be/ucopTLFQdKY

Going Stag: How Brideprice Influences Participation in Violent Conflict -- Bloodied and shaken from his participation in the four days of attacks in Mumbai, India in 2008, twenty-one year old Mohammed Jamal Amir Kasab, confessed to police that he had only joined Lashkar-e-Taiba at his father’s urging — so that Kasab and his siblings could afford to marry. Kasab told police that his father convinced him that his participation would mean that the family would no longer be poor and that they would be able to pay the costs required to finalize a marriage contract. One of the police officers, seemingly ignoring Kasab’s response, pressed, “So you came here for jihad? Is that right?” Crying, Kasab asked, “What jihad?”  Lashkar-e-Taiba deposited the promised money in his father’s account after the successful attack; for his participation, Kasab was hanged in 2012 by the Indian government. Though brideprice traditions have largely fallen out of practice in the United States and Western Europe, roughly ¾ of the world’s population live in countries where marriage ceremonies demand an exchange of assets.This exchange, like other economic markets, is subject to fluctuations, inflation, and exogenous shocks. Furthermore, brideprice — the practice in which the intended groom provides his fiancee’s kin with goods or money prior to the wedding — often presents itself as a regressive tax levied on young men. This is because brideprice is generally a reflection of the woman’s status, not the man’s economic status, and is generally set at a community-wide level and adjusted upward for more elite women and girls. Particularly in societies that also practice polygamy, the dynamics of this marriage market lend themselves to a concentration of wealth (here measured in brides) in the hands of socio-economically elite men. The stratification of this measure of wealth presents itself as a situation in which the un- or under-employed young men in a community are unable to take a wife.

India May Issue Its Own Bitcoin-like Cryptocurrency As Legal Tender - Less than a year after India launched a shocking "war on cash" when on November 8, 2016 it unveiled a demonitization campaign in an effort to wipe out huge amounts of so-called 'black money' and streamline its largely cash-based economy, which however was called “a colossal failure which cost innocent lives and ruined the economy" by Rahul Gandhi earlier this month after it was revealed that 99% of the high denomination banknotes cancelled last year were in fact deposited or exchanged for new currency, even as India's GDP tumbled to 2 year lows.... on Saturday, the Business Standard reported that while working on creating a legal framework for bitcoin and other digital currencies, the Indian government is considering launching its own bitcoin-like cryptocurrency.Preempting a report by the BIS released on Sunday, and which recommended that central banks should seriously consider launching cryptocurrencies of their own, the Indian press reports that the Indian government is considering “a proposal to introduce its cryptocurrency similar to bitcoin,” and which will be issued by the Reserve Bank of India (RBI). This state-run cryptocurrency will be called “Lakshmi,” the name of the Hindu goddess of wealth, fortune, and prosperity.The proposal was reportedly "discussed by a committee of government officials, and the panel found the idea of setting up and running blockchain for financial services useful."The report comes just days after RBI Executive Director Sudarshan Sen talked about the central bank’s discomfort with Bitcoin at the India Fintech Day conference. He hinted at the time that the government may be introducing its own fiat cryptocurrency which will be issued by the RBI.“Right now, we have a group of people who are looking at fiat cryptocurrencies. Something that is an alternative to the Indian rupee, so to speak. We are looking at that closely,” he said. Echoing China's own displeasure with the soaring popularity of cryptocurrencies, the RBI executive stressed that the central bank is not comfortable with non-fiat cryptocurrencies such as bitcoin.

Philippine president has ordered the death of his own son, if he is found guilty of drug trafficking -- Philippine president Rodrigo Duterte has ordered his eldest son to be killed if it is proved that he is involved in drug trafficking. "My orders are to kill you if you are caught, and I will protect the police who kill you," Duterte said. His son Paolo Duterte, 42, is the vice mayor of the family’s southern home city of Davao. Earlier this month he accused of being a member of a triad Chinese transnational organised crime syndicate but denied the allegations. According to a report in the Sydney Morning Herald, the president justified his calls saying if he is found guilty then "the people can’t say anything against me". "That’s better… so I can say to people: ‘There, you keep talking. That’s my son’s corpse’," he said. When Duterte was elected last year he declared war on the drug dealers and users who he said were blighting his country.   As of April 2017, there have been more than 7,000 people who have been slain in drug-related killings.

Venezuela Bankrupt? Caracas Fails To Make Sept 15 Interest Payment -- Exactly one week ago, we wrote that a "Venezuelan default is only a matter of time".  Among other things we warned that "default seems inevitable in the medium term due to the prolonged period of low oil prices and increased US sanctions. President Trump's executive order of August 24, 2017, strengthened sanctions against PDVSA by prohibiting all transactions related to new debt with a maturity greater than 90 days and by forbidding Citgo from repatriating dividends in Venezuela."Well, the default may have come in far sooner than even we expected as moments ago Bloomberg reported that according to sources, intermediaries tasked with processing Venezuela’s $185 million interest payment due Sept. 15 haven’t received the cash to do so.It adds that "several holders of bonds due in 2027 haven’t received a payment", and that an "official at the public credit office in Caracas declined to comment on whether the funds have been transferred or when investors will receive them."Further suggesting that Venezuela may have indeed entered its 30 day grace period, the country's National Office of Public Credit hasn’t made any public statements about transferring funds for the coupon. In the past, Bloomberg notes that the office has used its Twitter account to alert the market when the bond’s fiscal agent has been paid. For now the bond market appears to not have noticed with Venezuela bond issues still trading at respectable levels.

BIS Finds Global Debt May Be Underreported By $14 Trillion -- In its latest annual summary published at the end of June, the IIF found that total nominal global debt had risen to a new all time high of $217 trillion, or 327% of global GDP...... largely as a result of an unprecedented increase in emerging market leverage.  While the continued growth in debt in zero interest rate world is hardly surprising, what was notable is that debt within the developed world appeared to have peaked, if not declined modestly in the latest 5 year period. However, it now appears that contrary to previous speculation of potential deleveraging among EM nations, not only was this conclusion incorrect, but that developed nations had been stealthily piling on just as much debt, only largely hidden from the public eye, in the form of swaps and forwards.  According to a just released analysts by the Bank of International Settlements, "FX swaps and forwards: missing global debt?" non-banks institutions outside the United States owe large sums of dollars off-balance sheet through instruments such as FX swaps and forwards. The BIS then calculates what balance sheets would look like if borrowing through such derivative instruments was recorded on-balance sheet, as functionally equivalent repo debt, and calculates that the total "is of a size similar to, and probably exceeding, the $10.7 trillion of on-balance sheet dollar debt", potentially as much as $13-14 trillion.

Global debt may be understated by $13 trillion: BIS | Reuters: (Reuters) - Global debt may be under-reported by around $13 trillion because traditional accounting practices exclude foreign exchange derivatives used to hedge international trade and foreign currency bonds, the BIS said on Sunday. Bank for International Settlements researchers said it was hard to assess the risk this “missing” debt poses, but that the main worry was a liquidity crunch like the one that seized FX swap and forwards markets during the financial crisis. The $13 trillion unaccounted-for exposure exceeds the on-balance-sheet debt of $10.7 trillion that data shows was owed by firms and governments outside the United States at end-March. The fact these FX derivatives do not appear on financial and non-financial institutions’ balance sheets under current accounting rules means little is known about where the debt lies. “The debt remains obscured from view,” Claudio Borio, head of the BIS’s monetary and economic department, and two colleagues, Robert McCauley and Patrick McGuire, said in its latest quarterly report. “Accounting conventions leave it mostly off-balance sheet, as a derivative, even though it is in effect a secured loan with principal to be repaid in full at maturity,” BIS said. Explaining the risk they added: “In particular, the short maturity of most FX swaps and forwards can create big maturity mismatches and hence generate large liquidity demands, especially during times of stress.” 

BIS discovers $14 trillion of dollar debt offshore, hidden in 'footnotes' -- The world’s top financial watchdog has uncovered $14 trillion of global dollar debt hidden in derivatives and swap contracts, a startling sum that doubles the underlying levels of offshore dollar credit in the international system. The scale of this lending greatly increases the risk of a future funding crisis if inflation ever forces the US Federal Reserve to tighten hard, draining worldwide liquidity and potentially triggering a dollar surge. A forensic study by the Bank for International Settlements says enormous liabilities have accrued through FX swaps, currency swaps, and ‘forwards’. The data is tucked away in the “footnotes” of bank reports. “Contracts worth tens of trillions of dollars stand open and trillions change hands daily. Yet one cannot find these amounts on balance sheets. This debt is, in effect, missing,” said the BIS analysis, written by team under chief economist Claudio Borio.“These transactions are functionally equivalent to borrowing and lending in the cash market. Yet the corresponding debt is not shown on the balance sheet and thus remains obscured,” they wrote in the BIS’s quarterly report.A breath-taking gap in global accounting rules mean that the debt is booked as a notional derivative, “even though it is in effect a secured loan with principal to be repaid in full at maturity.”The hidden lending comes on top of $10.7 trillion of recorded offshore dollar debt outside US jurisdiction. It pushes the combined total to $25 trillion or a third of global GDP.  While these contracts serve as a lubricant and hedging device for world commerce, they can be plagued by currency and maturity mismatches.

More than 40 million people were estimated to be victims of modern slavery in 2016 -- and one in four of those were children. -- More than 40 million people were estimated to be victims of modern slavery in 2016 -- and one in four of those were children. Those are the findings of a new report produced by the International Labor Organization (ILO), a U.N. agency focusing on labor rights, and the Walk Free Foundation, an international NGO working to end modern slavery.The report estimates that last year, 25 million people were in forced labor -- made to work under threat or coercion -- and 15 million people were in forced marriage. It's impossible to know exactly how many people are living in modern slavery, and different studies have produced different estimates. One reason is that modern slavery is a hidden crime that's difficult to identify. Another is that different studies use different definitions of slavery, with some including forced marriage, for example, and others not.In the past, two of the most widely quoted figures have been those produced separately by the ILO and the Walk Free Foundation. But this report, called The 2017 Global Estimates of Modern Slavery, marks the first time the ILO and the Walk Free Foundation have collaborated to produce worldwide slavery figures.

Out of Africa: Why the Migration Wave? --Not a single month has passed without dreadful disasters triggering desperate migrants to seek refuge in Europe. According to the International Organization for Migration (IOM), at least 2,247 people have died or are missing after trying to enter Europe via Spain, Italy or Greece in the first half of this year. Last year, 5,096 deaths were recorded.The majority – including ‘economic migrants’, victims of ‘people smugglers’, and so on – were young Africans aged between 17 and 25. The former head of the British mission in Benghazi (Libya) claimed in April that as many as a million more were already on their way to Libya, and then Europe, from across Africa. Why are so many young Africans trying to leave the continent of their birth? Why are they risking their lives to flee Africa?Part of the answer lies in the failure of earlier economic policies of liberalization and privatization, typically introduced as part of the structural adjustment programmes (SAPs) that many countries in Africa were subjected to from the 1980s and onwards. The World Bank, the African Development Bank and most Western donors supported the SAPs, despite United Nations’ warnings about their adverse social consequences.  SAP advocates promised that private investment and exports would soon follow, bringing growth and prosperity. Now, a few representatives from the Washington-based Bretton Woods institutions admit that ‘neoliberalism’ was ‘oversold’, condemning the 1980s and 1990s to become ‘lost decades’.While SAPs were officially abandoned in the late 1990s, their replacements were little better. The Poverty Reduction Strategy Papers (PRSPs) of the World Bank and IMF promised to reduce poverty with some modified policy conditionalities and prescriptions. Meanwhile, the G8 countries reneged on their 2005 Gleneagles pledge to provide an extra US$25 billion a year for Africa as part of a US$50 billion increase in financial assistance to “make poverty history”.

New rail routes between China and Europe will change trade patterns - The Economist -- ASTANA in Kazakhstan is one of the world’s most remote capitals, surrounded by thousands of kilometres of empty steppe. This summer Astana attempted to launch itself onto the global stage by hosting the World Expo, which closed on September 10th and underwhelmed many attendees. But there are other ways to have an impact. On the city’s north side, away from the Expo’s exhibits, a series of diesel trains, each pulling dozens of containers, roll through the old railway station. Most are heading from China to Europe. Last year over 500,000 tonnes of freight went by train between the two, up from next to nothing before 2013. Airlines and shipping firms are watching things closely. The trains rumbling through Astana result from a Chinese initiative, in tandem with countries like Kazakhstan, to build a “New Silk Road” through Central Asia. The earlier overland routes were once the conduits for most trade between Europe and China and India; they faded into irrelevance when European ships started circumnavigating the Cape of Good Hope. China has long wanted to develop its inland regions and push industry to “go west”, in order to spread economic growth more evenly. Manufacturers have been loth to shift, in part because of the higher cost of moving goods to ports for export. Developing a rail-freight network to Europe—an important part of China’s “One Belt One Road” policy—opens up a new route to market for its poorest areas. The land route through Central Asia is relatively short. A container ship too large for the Suez canal must make a 24,000km journey to reach Europe. Trains travel no more than 11,000km to reach the same destination.

Putin Orders End To US Dollar Trade At Russian Seaports - Whether in response to rising scorching tensions with the US, or simply to provide support for the ruble, on Tuesday Russian President Vladimir Putin instructed the government to approve legislation making the ruble the main currency of exchange at all Russian seaports by next year, RT reported citing the Kremlin website. The head of Russian antitrust watchdog FAS Igor Artemyev, many services in Russian seaports are still priced in US dollars, even though such ports are state-owned. So, in order to "protect the interests" of dockworkers and their complyees with foreign currency obligations, the government was instructed to set a transition period before switching to ruble settlements. The proposal to switch port tariffs to rubles was first proposed by Putin a year and a half ago, but it was mothballed only to pick up speed again in recent days. Originally, the idea was rejected by large transport companies, which said they prefer to keep revenues in dollars and other foreign currencies due to sharp fluctuations on the volatile ruble. However, the Russian anti-trust watchdog said the decision would force foreigners to buy Russian currency, which would stabilize rates and be good for the ruble.In 2016, Artemyev's agency filed several lawsuits against the largest Russian port group NMTP. According to FAS, the group of companies set tariffs for transshipment in dollars and raised tariffs from January 2015 "without objective grounds." The watchdog ruled that NMTP abused its dominant position in the market and imposed a 9.74 billion rubles fine, or about $165 million at the current exchange rate. The decision was overturned by a court in Moscow in July this year.While Russia's stated motive for the unexpected redenomination of trade at some of its largest trading hubs has to do with domestic economic policies, there is speculation that the timing of this decision has been influenced by the recent diplomatic fallout between the US and Russia, the result of which would be an heightened demand for the ruble, especially since it is rather complicated to find alternative sources for Russia's largest export by a wide margin: crude.

Ukraine requests new weapons from US as Russia kicks off huge military exercise - Military officials in Belarus have sought to calm Western fears about major war games with Russia involving thousands of troops, tanks and aircraft APAs thousands of Russian troops, aircraft and armour carried out massive war games across the border, Ukraine’s President was asking the US to supply advanced offensive weapons to defend itself against the “barbaric aggressive plans of the Kremlin”.   Petro Poroshenko had claimed that the military exercise, Zapad-2017, taking place in Belarus was really “a smokescreen to create new Russian army assault groups to invade Ukrainian territory”. The reality, he insisted, was that “with Moscow, one should always be prepared”, a lesson hard learned with the loss of Crimea and the civil war which had seen the east of the country effectively secede. The newly appointed US special representative for Ukraine has stated that Washington is actively considering sending heavy weaponry to the Kiev government. Kurt Volker had said “defensive weapons, ones that would allow Ukraine to defend itself, and to take out tanks for example, would actually help. This is a matter for further discussion and decision: but I think that the argument that this would be provocative to Russia or emboldening of Ukraine is just getting it backwards.”

Will the Splintering of France’s National Front Help or Harm It? -- Marine Le Pen warned recently that big changes were coming to her far-right National Front (FN) party, but she didn’t say they would happen so soon. On Thursday, key aide and FN Vice President Florian Philippot announced his decision to leave the party, in a move he says was prompted by internal divisions.“They told me that I was the vice president of nothing,” Philippot told France 2 Thursday, adding: “I don’t like ridicule, and I have never liked doing nothing, so of course I am leaving the National Front.”As Philippot left, he took a group of key allies with him. To hear him tell it, the 35-year-old FN stalwart was stripped of his official duties as head of strategy and communications after he refused to step down from his role as president of “The Patriots,” a think tank he launched within the party in May. Though Philippot described the group as a “new political force” supporting Le Pen, the far-right leader called it a “conflict of interest,” and demanded he quit one or the other. “I asked Florian Philippot to choose between the two,” Le Pen said Wednesday. “I will meet him, and if he does not choose, I will do it for him.”The group isn’t the only source of tension to appear within the party since its failed bid for the presidency against independent centrist Emmanuel Macron. Benoît Dillet, a teaching fellow at the University of Bath, told me the party also grew divided over ideological issues. “The first is very much on this idea of whether the Front National will remain a far-right party or not,” he said. “The second is whether the FN should ask to leave the European Union, or at least have a referendum.” The latter is an important issue to Philippot, who is credited as being the architect of the FN’s anti-EU and anti-eurozone platform. Though Philippot has stood by these policies (he previously threatened to quit the FN if it backtracked on either), some within the party blamed them for driving voters away from Le Pen, and argued that the party should instead focus its messaging around immigration and cultural identity. Indeed, 72 percent of French voters surveyed in the months leading up to the election said they opposed leaving the eurozone; 44 percent said they were “very opposed.”

Spain tightens grip over Catalan spending as tensions soar -- Spain's central authorities have increased their control over Catalonia's regional spending to make sure that no funds are diverted to paying for a suspended independence referendum, the country's finance minister said Friday.Following the weekly meeting of the Spanish cabinet, Cristobal Montoro said the government is also giving Catalan officials 48 hours to comply with a new system that scrutinises public payments in order "to guarantee that not one euro will go toward financing illegal acts."Montoro told reporters the extraordinary controls were justified in order to pay civil servants and suppliers procuring services in education and health, among other essentials, while at the same time ensuring financial stability and defending the country's legal order.Last week, Spain's constitutional court decided to suspend an independence referendum that Catalan leaders had penciled in for October 1 while judges decide if it is unconstitutional, as the central government in Madrid has argued.Separatist politicians in Catalonia   Spain's richest region that has Barcelona as its major city   are still pressing ahead with the referendum despite the ban and despite the launch of a criminal investigation into three-quarters of Catalonia's mayors who have supported the vote. On Thursday, Catalan Vice President Oriol Junqueras, who is in charge of economic affairs in the northeastern region, said he would stop providing central authorities with weekly spending reports.

What Spain has to lose from Catalan independence - Catalonia makes up only 6 percent of the country’s territory and 16 percent of its population, but it accounts for a fifth of economic output, a quarter of exports, over half of new startup investment in 2016 — and nearly a third of Spain’s Rio Olympic medalists. Independence supporters will gather Monday in Barcelona to celebrate the Catalan national day, ahead of the October 1 referendum on secession called by the regional government in defiance of Madrid and the Constitutional Court. Spanish Prime Minister Mariano Rajoy’s government has pledged to do everything in its power to stop the vote from happening. While a majority of Catalans don’t see independence as the ideal way forward, Madrid’s unwillingness to negotiate could still result in a secessionist victory in the knife-edge referendum. Here’s how national sentiment, language, place of birth and more play a part in determining support for independence, and what Spain could wave goodbye to if Catalonia does break away. (infographic)

 Catalonia’s Defiance of Spanish Authority Turns into Rebellion - “Do not underestimate the power of Spanish democracy.” With these words, eerily reminiscent of a line once spoken by Star Wars villain Darth Vader, Spain’s Prime Minister Mariano Rajoy brought to a close a week of frenzied drama. It began with a foiled attempt by the Spanish police to close down the official website for the Catalan independence referendum. As often happens with web-based raids, the official site was up and running again within minutes, albeit with a different domain name. Next, the Public Prosecutor’s office ruled that the referendum is now illegal “beyond all doubt” and instructed the Civil Guard, National Police, Catalan Police (Mossos d’Esquadra) and local police forces to act to stop it. It also launched criminal investigations against the entire Catalan government, the Speaker of the Catalan Parliament, the leaders of two separatist municipal associations and more than 700 Catalan mayors (representing 75% of Catalonia’s municipalities) for agreeing to cooperate with the planned plebiscite.On Friday, Spain’s Finance Ministry joined the fracas by introducing a motion that would hand Madrid much greater control over how Catalonia spends its money in an effort to block the regional government from using state cash to pay for an illegal independence referendum. It has also frozen Catalonia’s monthly advance of the national liquidity fund ( FLA), worth some €1.4 billion a month, and demanded that banks report any transactions related to the referendum vote to the central government.The ultimate goal is to turn the Catalan regional government into an empty shell of an institution — one that has no autonomy, or for that matter any practical function or purpose.Starving Catalonia’s regional government of funds could well make the vote logistically impossible, but the policy is not without its risks. As we warned a few months ago, if the Catalan government feels that it’s backed into a corner financially, it could weaponize its tick-tocking debt bomb. If Barcelona refuses to honor its debt to Madrid, both Catalan and Spanish debt could be declared in default, with disastrous consequences for both.

 Spanish police raid Catalan government to halt banned referendum (Reuters) - Spanish police raided Catalan government offices and arrested officials on Wednesday to halt a banned referendum on independence, an action the regional president said meant Madrid had effectively taken over his administration. Tens of thousands of protesters gathered outside the regional government offices in the center of Barcelona’s tourist district as well as in several Catalan cities, waving the red-and-yellow Catalan flag and chanting “Occupying forces out” and “Where is Europe?”. “The Spanish state has by all rights intervened in Catalonia’s government and has established emergency rule,” Catalan President Carles Puigdemont said in a televised address. “We condemn and reject the anti-democratic and totalitarian actions of the Spanish state,” he said, adding Catalans should turn out in force to vote in the Oct. 1 referendum on a split from Spain that Madrid has declared illegal. State police arrested Catalonia’s junior economy minister Josep Maria Jove on Wednesday in their first raid of government offices in the region, Catalan government sources said. The raid targeted several regional government departments. A dozen high-ranking local officials were arrested, La Vanguardia newspaper said. Police confirmed they were carrying out raids connected with the banned referendum, but did not give details. The Catalan government sources could not confirm the other arrests. 

Catalan Leader Accuses Spain of Violating Rights in Referendum - The regional president of Catalonia has accused the Spanish government of acting “beyond the limits of a respectable democracy” and violating fundamental rights as it strives to prevent an independence referendum from being held in 10 days’ time. Writing in the Guardian a day after Spanish Guardia Civil officers raided regional government buildings and arrested 14 senior officials, Carles Puigdemont insisted the vote would go ahead as “ballot boxes and a peaceful attitude” are the only weapons left to those who want independence.“Catalan home rule has effectively been suspended due to this anti-democratic attitude from the Spanish government,” he wrote. “It’s a situation that harks back to the dark past of this country, when democracy was not a part of the Spanish dictionary. What is happening here in Catalonia would not happen anywhere else in the European Union.”Puigdemont said requests for negotiations with the Madrid government had been ignored dozens of times, and the Spanish executive was refusing to entertain any dialogue on the issue.“Instead of engaging in discourse, the Spanish government has opted for police and judges, taking us beyond the limits of a respectable democracy,” he wrote. “With the arrests of high-ranking officials and threats to detain democratically elected politicians, I believe the Spanish government has violated the European charter of fundamental rights.”However, despite his assertion that the Spanish government was deliberately targeting officials, Wednesday’s arrests were ordered by a judge in Barcelona and not by anyone in Madrid. Puigdemont’s accusations came as Catalonia’s regional vice-president, Oriol Junqueras, admitted the arrests – and the seizure of almost 10m ballot papers – had changed “the state of play”.

It Gets Ugly in Catalonia - Madrid’s crackdown on Catalonia is already having one major consequence, presumably unintended: many Catalans who were until recently staunchly opposed to the idea of national independence are now reconsidering their options. A case in point: At last night’s demonstration, spread across multiple locations in Barcelona, were two friends of mine, one who is fanatically apolitical and the other who is a strong Catalan nationalist but who believes that independence would be a political and financial disaster for the region. It was their first ever political demonstration. If there is a vote on Oct-1, they will probably vote to secede.The middle ground they and hundreds of thousands of others once occupied was obliterated yesterday when a judge in Barcelona ordered Spain’s militarized police force, the Civil Guard, to round up over a dozen Catalan officials in dawn raids. Many of them now face crushing daily fines of up to €12,000. The Civil Guard also staged raids on key administrative buildings in Barcelona. The sight of balaclava-clad officers of the Civil Guard, one of the most potent symbols of the not-yet forgotten Franco dictatorship, crossing the threshold of the seats of Catalonia’s (very limited) power and arresting local officials, was too much for the local population to bear. Within minutes almost all of the buildings were surrounded by crowds of flag-draped pro-independence protesters.  Josep Maria Jové, was among those detained. He has now been charged with sedition and could face between 10-15 years in prison. Before that, he faces fines of €12,000 a day. The confiscation of ballots and other vital voting paraphernalia and the detention of key members of the referendum’s organizing committee, together with today’s decision by the Spanish Finance Ministry to completely block the regional government’s accounts — a move that would not be possible without full cooperation of both Spanish and Catalan banks — could be a major setback for Catalonia’s dreams of independence. Nonetheless, yesterday’s police operation significantly — perhaps even irreversibly — weakens Catalonia’s plans to hold a referendum on October 1, as even the region’s vice-president Oriol Junqueras concedes. But that doesn’t mean Spain has won. As the editor of El Diario, Ignacio Escolar, presciently notes, yesterday’s raids may have been a resounding success for law enforcement, but they were an unmitigated political disaster that has merely intensified the divisions between Spain and Catalonia and between Catalans themselves.

EU to tighten supervision of financial sector after Brexit — EUbusiness.com  - The EU Commission proposed reforms Wednesday to tighten the EU's supervisory architecture for the financial sector, paving the way for further financial integration after Brexit. The reforms will promote further capital market integration following the UK's departure from the EU, and European consumers, investors and businesses will benefit from stronger and more integrated financial markets, says the EU executive. The proposals include steps to foster the development of financial technologies (FinTech) and to make sure that sustainability considerations are systematically taken into account in supervisory practices at the European level."Financial markets are changing fast. We are seeing renewed cross-border integration, new opportunities in FinTech and a boom in sustainable and green finance," says Financial Services Commissioner Valdis Dombrovskis: Once adopted, the proposals will improve the mandates, governance and funding of the ESAs for banking (European Banking Authority, EBA), for securities and financial markets (European Securities and Markets Authority, ESMA), and for insurance and pensions (European Insurance and Occupational Pensions Authority, EIOPA). To ensure a uniform application of EU rules and promote a true Capital Markets Union, the proposals also entrust ESMA with direct supervisory power in specific financial sectors. In addition, the Commission is proposing targeted changes to the composition and organisation of the ESRB, which monitors stability risks for the financial system as a whole. A Single Rulebook for financial regulation in Europe was created when the EU overhauled its financial system in the wake of the financial crisis, as well as the European Supervisory Authorities and the European Systemic Risk Board. These bodies were seen as pivotal in ensuring that financial markets across the EU are well regulated, strong and stable. However, the Commission says more needs to be done to enhance regulatory and supervisory convergence within the Single Market to help European financial markets work more effectively and to address new challenges.

Frustrated EU fears Britain is ‘heading for the Brexit rocks’ - On Wednesday afternoon, with Jean Claude Juncker’s state of the union speech calling for swifter, deeper integration still ringing in their ears, a gaggle of political leaders in the European parliament met in a room opposite the chamber in Strasbourg. In the appositely named Salle de Margaret Thatcher, Guy Verhofstadt, the colourful former Belgian prime minister who is coordinating MEPs’ response to Brexit, discussed with colleagues from the pro-European political parties on the parliament’s Brexit steering group how they should respond to the seeming stalemate in the Brexit negotiations. The latest draft of a parliamentary resolution was discussed, lamenting the failure of the talks to develop on the key opening issues – citizens’ rights, the Irish border and the financial settlement. The resolution is set to advise the member states’ leaders, who will make the big decision at a summit in Brussels on 19-20 October, that the negotiations cannot move on to trade as things stand. “The talk at the meeting was mainly about when to hold a vote on it in the parliament,” an EU official said. “They want to have it on 3 October – the day before Theresa May makes her speech to Tory conference. They want the Tory delegates to hear about it.” The public reprimand for the prime minister at a sensitive point in the political calendar isn’t just about grandstanding from the MEPs. Her government’s offers on citizens’ rights and the Irish border, along with a lack of offer on the financial settlement, has genuinely concerned senior figures within the European commission leading the negotiations and among the member states. On citizens’ rights, the offer to give EU nationals the same rights as British citizens would leave them with fewer rights than today. The solutions proposed in Ireland, involving the suspension of the normal border checks one would expect for a country outside the EU’s customs union and single market, have been rejected almost out of hand by the commission, as an affront to the legal order. And on the financial settlement – perhaps the biggest stumbling block – the EU’s chief negotiator has questioned whether Brussels can really trust the British on anything, given Downing Street’s reluctance to admit Britain has a legal duty to live up to the spending commitments already made by the EU.

Boris Johnson resurrects the Leave campaign’s £350m for NHS fantasy - In a column for the Telegraph, Boris Johnson has repeated the false claim that Brexit will result in £350m a week for the NHS. “Once we have settled our accounts, we will take back control of roughly £350 million per week,” he writes. “It would be a fine thing, as many of us have pointed out, if a lot of that money went on the NHS.” This notorious pledge – its place on the side of the Vote Leave battle bus now a symbol of the misleading campaign – was dropped even by the most ardent Brexiteers in the aftermath of the EU referendum.   Just a few hours after the result, Nigel Farage himself was on Good Morning Britain, merrily calling the claim “a mistake”. Change Britain, the Vote Leave campaign’s successor group, abandoned the promise in September last year.  The figure is inaccurate, because it doesn’t account for the UK’s rebate, which is removed before it sends any money to Brussels.  After the rebate, the money it paid the EU in 2014 was £276m per week – not the £350m claimed – and that money is sent back to Britain for farming subsidies, underdeveloped regions, science and universities, etc. On some projects, this funding is matched by private investors.  So we wouldn’t be getting £350m or £276m a week extra by leaving. Also, Britain’s contribution to the EU has been decreasing since 2014. The Leave campaign’s figure is simply wrong.  Johnson, a fairweather Brexiteer, knows full well that it’s inaccurate. Perhaps he thinks the insertion of the craven adverb “roughly” into his column protects him. But he’ll need more than that to rescue his reputation.

Brexit: unleashing a wildfire -- Defending Brexit is not the easiest thing to do at the moment when we have a government hell bent on delivering the worst case scenario. It also doesn't help that the Brexit groupthink produces pretty feeble economic justifications rather than looking at the issue as a whole. Fighting on the enemy's turf is always a loser and the mainstream Brexiter economic justifications are collapsing.  I have argued for a long time now that the economy is a secondary concern - and as far as that goes, the aim of the Brexit process should be to minimise what is bound to be economically stressful. Something this government is failing to do.But then, I repeat, this isn't an economic question and it never was. It is political, cultural and constitutional. It is said that Brexit has divided the nation but in fact all it has done is exposed a deep cultural chasm that was not being addressed by the status quo. There is a gulf of misunderstanding between the factions and it's time we dragged it all out for examination. When we look at that we find that it stems from a collapse of trust in UK institutions. And that can hardly be a surprise. Every major increment in EU membership has been done by subterfuge and deception. Direct consent has never been sought and our interactions in the EU have been yet more deception. Cameron's phantom veto and the bogus attempts at reform were quite obvious pieces of political theatre from an establishment with no regard to the wishes of the public. This opens up broader questions as to whether the EU is dysfunctional or whether our own "democracy" is failing. I'm going to say both, but even if I sided with the remainers in saying it is a problem entirely with UK democracy, I would still choose to leave on account of there being no defence mechanisms or restraints on what the government can do to us in our name - especially in relation to the European Union. Brexit is an overdue corrective.

Brexit: What did we learn from Theresa May's Florence speech? - Prime Minister Theresa May has used a speech in Florence to set out the UK's position on how to move Brexit talks forward. With further negotiations planned next week, what did her speech tell us about the sort of Brexit deal we might end up with? It's worth noting that a lot of Brexit supporters in the UK jumped on Jean-Claude Juncker's State of the European Union speech last week - in which he set out an ambitious agenda of greater integration - as an example of why they wanted to leave in the first place. The PM picked up on this - we're getting out of your way while you move in a different direction that we've never felt entirely comfortable with. That's good for both of us she implied.   Urging EU leaders to be creative, ambitious and to share a "profound sense of responsibility to make this change work" is a bit of a departure from the language in her last major speech on Brexit at Lancaster House in London in January. It contained warnings of "an act of calamitous self-harm" for the countries of Europe if they sought to punish the UK, and the famous assertion that "no deal is better than a bad deal" for Britain. The rest of the EU will take note of this more collaborative appeal but will also be watching to see whether the tone changes again in the prime minister's speech to the Conservative party conference next month.  The prime minister is saying she wants to incorporate an agreement on EU citizens' rights into UK law, and she thinks UK courts should be able to "take into account" the judgements of the European Court of Justice. It's a real guarantee, she says: "We want you to stay." The trouble is that it's not what the EU is demanding. The chief EU negotiator Michel Barnier insisted in a speech yesterday that the Court of Justice should remain the ultimate guarantor of any agreement. The big difficulty here is that jurisdiction is a pretty black-and-white issue - there are few grey areas. As things stand, the UK view is that British courts should have the final say, and the EU sees that as unacceptable.

Theresa May faces Brexit backlash from her own MPs protesting she is delaying full EU departure -- Jacob Rees-Mogg has led a backlash from Brexit-backing Tory MPs against Theresa May’s plan to slam the brakes on full EU withdrawal, calling it “disappointing”.The new right wing Conservative champion criticised the proposal for a two-year transition because it would delay the end of free movement and continue to hand billions of pounds to Brussels.Mr Rees-Mogg also urged the Prime Minister to come clean over whether Britain would remain under the remit of the European Court of Justice – which should be ruled out as a “red line”. Meanwhile, the former Cabinet minister Iain Duncan Smith warned the transition was “controversial”, calling for guarantees that ECJ jurisdiction and single market membership would end in 2019.And Owen Paterson, another former Cabinet minister, protested that the transition period “puts off the time when we can really take advantage of having left”.The backlash came as the Czech Europe secretary, Ales Chmelar, warned the divorce bill would be far higher than the £18bn Ms May is now willing to pay, to cover the remaining EU budget period.“This is just a payment for the remaining financial framework period. This is not a payment for all the legacies that we see, including for example the pensions and the legacies in terms of grants and funds,” he told the BBC Radio 4 Today programme. Sources in Brussels told The Times that the remaining liabilities could reach £20bn – making the total exit bill close to £40bn – and would have to be negotiated separately.In her much-anticipated Florence speech, the Prime Minister asked for single-market access, and for Britain to stay within a customs agreement, for up to two years.During that time, the UK would continue paying into EU budgets and abide by EU rules, even accepting new regulations through to 2021.To appease Eurosceptics, Ms May insisted the arrangements would be “time-limited” and that Britain would technically leave both the single market and customs union. But Mr Rees-Mogg, speaking on BBC’s Newsnight programme, said: “I have three concerns about the speech. The first is free movement, which ought to end at the end of March 2019.”

Irish border data underlines huge task facing Brexit negotiators -- The scale of possible disruption through the introduction of a post-Brexit hard border between Northern Ireland and Ireland is underlined by the estimate that, in May this year at selected crossing points, there were 118,000 private vehicle crossings on a daily basis, which extrapolates to 43m crossings annually at those sites alone. At the same sites there are also an estimated 900,000 cross-border coach passenger journeys every year and 868,500 cross-border train passenger journeys.The report published on Thursday adds that, according to the 2016 Irish census, there were 57,000 residents of Ireland who were born in Northern Ireland and, according to the 2011 Northern Ireland census, 38,000 residents of Northern Ireland who were born in Ireland. The five district councils closest to the border in Northern Ireland have 23,000 (61%) Northern Ireland residents who were born south of the border.The detailed statistical portrait of the Irish-born living in Britain shows an ageing population of first-generation migrants, with 42% over the age of 65. Among those of working age, more than one in three work in professional occupations, including teaching, nursing and the tech industries.The profile of the UK-born population in Ireland is younger, with 134,840 (31%) in receipt of a UK state pension. The occupational sector with the highest proportion of UK-born people is culture, media and sport, where they are one in eight of the workforce. The report also contains a breakdown of the latest migration figures for Northern Ireland, which shows that, in addition to 38,000 Irish-born residents, there are 25,000 Poles, 25,000 Lithuanians and 28,000 residents who were born in other EU countries. Many can expect to be asked to apply for the new “settled status” when Britain leaves the EU. There are a further 45,000 people who were born outside the EU living in Northern Ireland.Emma Rourke, director of public policy analysis at the Office for National Statistics, said: “The complex and historic relationship between the UK and Ireland is one of the most challenging areas facing the UK and the EU as Brexit negotiations proceed.

London Unexpectedly Revokes Uber's Operating License -In a stunning blow to the world's most valuable private company, London's taxi and livery car regulator has said it won't renew Uber's operating license once it expires at the end of the month. The regulator said Uber "is not fit and proper to hold a private hire operator license.""TfL considers that Uber's approach and conduct demonstrates a lack of corporate responsibilit in relation to a number of issues which have potential public safety and security implications. These include:

  • It's approach to reporting seriouis criminal offences.
  • It's approach to how medical certificates are obtained.
  • It's approach to how ENhanced Disclosure and Barring Service (DBS) checks are obtained.
  • It's approach to explaining the use of Greyball in London, software that could be used to block regulatory bodies from gianing full access to the app and  prevent officials from undertaking regulatory or law enforcement duties."

TfL has today informed Uber that it will not be issued with a private hire operator licence. pic.twitter.com/nlYD0ny2qo— Transport for London (@TfL) September 22, 2017 Uber now has 21 days to appeal the decision. We imagine the company will be out with a response soon.

Millennials spend three times more of income on housing than grandparents - Millennials are spending three times more of their income on housing than their grandparents yet are often living in worse accommodation, says a study launched by former Conservative minister David Willetts that warns of a “housing catastrophe”. The generation currently aged 18-36 are typically spending over a third of their post-tax income on rent or about 12% on mortgages, compared with 5%-10% of income spent by their grandparents in the 1960s and 1970s. Despite spending more, young people today are more likely to live in overcrowded and smaller spaces, and face longer journeys to work – commuting for the equivalent of three days a year more than their parents. The research by Willetts’ intergenerational commission at the Resolution Foundation thinktank also reveals that today’s 30-year-olds are only half as likely to own their own home as their baby boomer parents. They are four times as likely to rent privately than two generations ago, a sector which has the worst record for housing quality, the report claims. The report’s authors argue that the housing crisis is a huge part of public anxiety about the country’s direction, a factor in the result of the EU referendum last year and in the general election in June.  A young family today has to save for 19 years on average to afford a typical deposit compared with three years for the previous generation, the report states. “This is the biggest problem facing the younger generation,” said Willetts. “It depresses their living standards and quality of life. It is very important for the Tory party to open up the route to home ownership again. A lot of twentysomethings also have horror stories of bad landlords and we need to help them as well.” By highlighting intergenerational inequality, Willetts hopes to break down public opposition to mass housebuilding – not least from parents who despair at the difficulty their children face in finding good housing. He is arguing for a new towns programme in which the government buys land that does not have planning consent to create large new communities of homes for sale.