Monday, January 26, 2015

BONEHEAD BOEHNER

House Speaker Boehner Makes Traitorous Move Inviting Netanyahu

House Speaker John Boehner, has secretly set up a speech date with Prime Minister Netanyahu of Israel to address Congress on the issue of the on-going negotiations with Iran over their nuclear plans. Neither Bohener of Netanyahu bothered to inform the White House. Bohner's evident purpose is to embarrass our President, and to undermine and pressure him to abandon or alter his policy regarding negotiating with Iran. The people did not elect John Boehner to make policy or to dabble in foreign policy, or to undermine established objectives by placing unwarranted obstacles in the President's path. Furthermore, Boehner is disloyally siding with a foreign leader (over his own President), a leader (naturally) with ulterior motives. Netanyahu is soon to face his own electorate. While Boehner's actions are an attack on the clear, well-planned policies of our own President and State Department.

What has become of protocol? What has become of the unwritten rule that as Americans we speak with one voice when we address foreign policy matters beyond our borders. Boehner's actions undermine the U.S.'s world leadership, our relationships with our allies, and our well considered and long thought out strategy and developed policies for dealing with Iran. Netanyahu has only his own domestic knives to sharpen in our Congress and he does so at our nation's expense. Mr. Netanyahu, the beneficiary of American support, both fiscal and political, is unwisely meddling in US domestic politics, something every Israeli would object to were the tables turned. Mr.Boehner is foolishly aiding and facilitating him in this matter. The American people will rightly resent and ultimately take umbrage with Netanyahu and his unwarranted intrusion, particularly if his meddling leads us into another unwanted war in the Middle East. Mr. Netanyahu's actions are those of a foreign leader and are, as such, understandable, Mr. Boehner's actions, the third highest elected American leader, are more than just questionable and unwise....they are downright disloyal and traitorous.

rjk


Tuesday, January 13, 2015

CHARLIE HEBDO, BARUCH GOLDSTEIN RELATED HYPOCRICY

CHARLIE HEBDO, WESTERN HYPOCRISY, COLLECTIVE RESPONSIBILITY AND BARUCH GOLDSTEIN

In the wake of the tragic and horrific Charlie Hebdo massacre in Paris ( Jan 9, 2015) a lot of gobbledegook has spewed from the pens and lips of the chattering classes. Much of it is shameful, hypocritical and illogical. Too much fails to place these events in the historic context of the last decade. A period of the west's Crusader-like wars in the Middle East and the terrible devastation, death and destruction directed, almost exclusively, at the members of one religious group...Muslims.

Yesterday ( Jan 11, 2015) I read in the New Yorker, the opinion of George Packer,an American journalist. Packer was an early supporter of George Bush Jr's illegal and disastrous war in Iraq. Packer takes a position which focuses the blame squarely on Islam. He ticks off a list of the violence of the Islamists but conveniently ignores the terror wielded by the west's aerial bombardment, illegal wars, drone attacks, torture cells and black sites around the world. Actions which have killed and maimed Muslims in the many hundreds of thousands since 9-11. He ignores the scholarly studies which tally the dead of the Iraq war alone at nearly a half million, and the added killings of Mr Obama's more technically sophisticated but just as deadly and immoral "kill lists" and drone attacks.

Packer states: "They (the Charlie Hebdo killings) are only the latest blows delivered by an ideology that has sought to achieve power through terror for decades. ( !!) It’s the same ideology that sent Salman Rushdie into hiding for a decade under a death sentence for writing a novel, then killed his Japanese translator and tried to kill his Italian translator and Norwegian publisher. The ideology that murdered three thousand people in the U.S. on September 11, 2001. The one that butchered Theo van Gogh in the streets of Amsterdam, in 2004, for making a film. The one that has brought mass rape and slaughter to the cities and deserts of Syria and Iraq. That massacred a hundred and thirty-two children and thirteen adults in a school in Peshawar last month. That regularly kills so many Nigerians, especially young ones, that hardly anyone pays attention."

If it WERE appropriate to tally up the the deaths on the two opposing sides (it is not), one might have brought Packer ( after all he is a "New Yorker" journalist) to task for failing to even mention the massive imbalance in the death tolls. That lapse suggests an uncharacteristic imbalance, for a reporter of Packer's stature. Packer was not alone in his virulent attack on Islam. The infamous billionaire, Rupert Murdock of News Corp, owner of Fox News, where ignorance and bigotry reign, got his two cents in as well. Regarding the Charlie Hebdo tragedy, Murdock tweeted " Maybe most Moslems peaceful. But until they recognize and destroy their growing jihadist cancer THEY MUST BE HELD RESPONSIBLE. So the 1.6 billion Moslems in the World, about one out of every four humans on this Earth, are, according the Murdock, all collectively responsible for the Charlie Hebdo massacres!

Besides collective blame on Islam, some in France, and elsewhere tried to equate the Paris attacks with the 9-11 tragedy in New York. I understand their motivation, but I find little similarity there in the scale, method and intentions of the the perpetrators. But if one is looking for precedent, the Charlie Hebdo attacks were strikingly reminiscent of the well-recorded, but now seemingly forgotten (or ignored) massacre at the Cave of the Patriarch in Hebron in the West Bank. No one in the formal media seemed to make that connection. Thus I do so here.

On February 25, 1994, in the West Bank at the Hebron Ibrahimi Mosque, 29 male worshippers were shot dead by Israeli, fanatic, Baruch Goldstein, a member of the far right Israeli Kach movement. Goldstein entered the mosque armed with a Kalashnikov assault rifle and calmly and deliberately opened fire on unarmed, Muslims at prayer. He killed 29, wounding 125 others. The death toll far exceeded that of the recent Paris tragedy. Goldstein was finally overcome and beaten to death by the survivors when he ran out of ammunition. In the subsequent unrest in the West Bank, and Israel , there were no peace demonstrations. There was no handwringing and claims of us all being Palestinians ( No "Je suis Palestinien".) No prayer vigils for the dead outside of the Homes of the Muslim victims. No mass marches with world leaders arm and arm in unity against "terrorism" as in Paris. There were no widespread arrests or attacks on on Jews, or on Judaism as a a violent hateful religion. Instead, in the unrest and demonstrations in the following 48 hours an additional 19 Palestinians were shot dead in the streets by Israeli defense forces.

When we will see that violence breeds violence. There is no difference for the poor victims of terrorism...their death and mutilation is the same whether the means was delivered by a high flying drone or by a man carrying a gun or wearing an explosive vest. When we all understand that our government's mostly unnecessary and illegal actions generate reactions, our acts of state terror delivered by F16s or Reaper drones breed reactions, and there is no final peace or solution that can be arrived at through violence...then perhaps the seekers of peace will finally rise up en masse out of the squalor and wasteland that our lands will have become and call for a halt to this madness.


Friday, January 2, 2015

CHEAP OIL WILL IT LAST?

OIL PRICES ARE DOWN, WILL THEY STAY THERE?

Since June 2014 oil prices have plunged to their lowest levels in a long time. In June a barrel of sweet crude was selling for $115 dollars....it is now ( figure for late December 2014) $55 dollars a barrel. Gasoline prices have fallen from (variously) $3.79 to today in Peru, Vt. $2.59 or about a third less than what we had been paying only a few months ago. Will these savings continue or is this just a seasonal windfall?
What happened?
It's simple supply and demand. Too much supply, not enough demand. On the "not enough demand" side, the picture is clear. The big guns of crude oil consumption, the USA, and China both have economies which are either stuttering along or just slowly recovering (USA) from the Great Recession. Oil consumption is down. There are simply fewer machines, automobiles, trucks and heavy equipment in operation. There are fewer long-haul deliveries, fewer bull dozers and road scrapers, in use. Then too, in these countries, and in the rest of the world, the elevated prices of oil during the last boom, engendered a counter response to the dear oil-efficiency. In the USA and most industrialized nations we are driving fewer miles and in smaller more compact cars and trucks. Ford Motors has even introduced a more efficient..low weight..F150 truck-- of its most popular models offered with a significantly lighter aluminum body..which will use considerably less fuel than the old models.

On the supply side there are several reasons, but the major one is that all world producers are simply pumping at near maximum capacity. Libya, with the largest oil reserves in Africa, had been expected to remain in low-production mode due to the political turmoil resulting from the civil war in which Col. Muammar Gaddaffi was overthrown and killed in 2011. However, surprisingly, and no doubt with the help of interested parties based in the USA , Libyan post-Civil War production surged from only 300,000 barrels per day ( bbl/day) to a million barrels a day (1,000,000 bbl/day) in late 2014. (Libya remains a turbulent area, however, in which the region known as the Libyan "oil crescent" is being continually contested by rival militias. Just a few days ago, around Christmas, a stray she'll from an insurgent rocket..set off a huge fire which consumed millions of barrels of the black stuff. It was snuffed out yesterday. So presumably production will continue. )

Also on the supply side. In a major development in the US, a new technology termed "fracking" and horizontal drilling have made substantial changes in US oil production. Since about 2012, US drilling companies have driven over 20,000 new wells into the North Dakota, Bakken oil shales. These so called "tight oil" wells can be highly productive when drilled using the new technology. In this method a standard well is driven down into the oil bearing strata. At this point the well bit is manipulated so it will drill horizontally to follow the trend of the underground oil-bearing rocks. As it is drilled along, parallel to confining strata, water mixed with other chemicals and sometimes fine solids too, are pumped down from the surface at very high pressures to crack or fracture ( hence the verb "fracking") the bearing strata and encourage the flow of the trapped "tight oil" into the well and then up to the surface.

Prior to this new technology, US domestic oil production averaged approximately 4 million barrels per day (4 mil bbl/ day) much of it from wells in the west Texas Eagle Ford Shale . The USA consumes on average about nine million barrels per day (9 mil bbl/ day) so our domestic production met only less than half of our needs. We were require to satisfy the remainder by importing about five million barrels per day from the world market. But with the recent new production from the twenty thousand wells in the Bakken Shale, US production in mid 2014 rose to a bit more than 9 million bbl/ day. We were oil independent at last! It is noteworthy to point out that amount of production is is approximately equal to that which Saudi Arabia produces per day. So at the present time the USA and Saudi Arabia are about equal in production. Naturally, with the additional five million barrels per day from US Bakken production, the USA did not have to import that extra oil from abroad and that oil, as well as the additional million barrels of unexpected oil from Libya, are the sources of the oil glut we are experiencing now.

Normally under these circumstances the Saudis, would simply reduce their production level to keep the prices of oil stable. However, in this instance they chose not to. To reduce their production and that of the the other OPEC members to take up the amount produced by the USA a would have cost these producers dearly. It would mean a big drop in income. They chose to continue producing their 9mil bbl/ day and other OPEC members followed suit. They could not act independently, since their production levels are much less than those of Saudi Arabia.

Why have they continued to pump oil, unwilling to decrease supply to jack up the world price ?

The Saudis have made a strategic decision to protect their market share. They might take a short term loss, but high prices...prices above the $50 dollar level, will only encourage US investment in the oil fields of North Dakota. If they were to move to keep oil prices high, they would only be encouraging investors in the USA to continue drilling new wells. To protect their market share over the long haul, they must continue depress prices and to pump and sell their oil. With their low production costs will continue to make a profit, although not quite as much as before.

The underlying reason. Saudi wells are established and their premium quality, light-sweet crude in many wells still rises to the surface under pressure. Their production cost are low, in their older fields, as low as $28.00 per barrel. While the cost of production in the US Bakken Oil Shales are much higher. North Dakota oil is profitable only when world market oil prices reach above $65 or $70 dollars per barrel. Right now, with oil at $55 dollars per barrel and falling, "tight oil" costs more to produce than a oil company can sell it for on the world market. Bakken oil is not a good investment right now. The low prices have transformed the world oil market and investment portfolios of many entrepreneurs.

And that goes double for Canadian tar sands oil, extracted so inefficiently and laboriously and with such high environmental costs. The burning political question of US support or non-support for the infamous XL pipe line is now moot. Production costs are very high for tar sands which were only marginally profitable when oil was selling at $100 dollars a barrel. And that marginal profitability was the case only IF the Canadian producers could transport their heavy oil sludge to refineries (rather than by train) cheaply across the USA, by way of the XL Pipe Line. Oh yes, and don't let anyone sell you some cheap shares in an Arctic oil well, where production cost are well over $100 dollars a barrel. Not when oil is settling in at $45 to $50 dollars per barrel. At those prices only the oil sheiks can make a profit.

Thus the short answer to the above question is: Yes is seems very unlikely, that the Saudis will want to give up their market share and encourage competition by helping to raise prices. So under the present circumstances, I would expect low prices to continue. When (and if ) the world economy builds up a full head of steam and drives up consumption, we may then see prices rising again. Or if some calamity befalls one of the major producers, such as war, earthquakes, floods, or pestilence or any factor that may reduce production, then prices will climb again. So for the near term expect oils prices to remain low.

If you were looking to give up that cramped, little Prius capable of 50 miles per gallon for a nice new American Ford 150 truck 4x4, with the big cab, and the knobby tires, well that may be possible now.

But remember, lower prices put into play counter pressures. Low prices encourage increased consumption and waste. Higher usage will inevitably cause the glut to eventually dissipate and prices to increase again. So maybe go with the Ford 150 with the light aluminum body...and hedge your bet.

Rjk

Thursday, January 1, 2015

WHY IS PRESIDENT OBAMA SO UNPOPULAR

Why is Obama so unpopular? He has focused his efforts on the elite and ignored his own constituents.


In a fine piece by David Cay Johnston published in Aljazeera, December 29, 2014, and entitled "What's not to,like about the economic record of this president"? Mr. Johnston summarizes President Obama's economic record over the last six years. What stands out in the summary is where and for whom Obama stands. He has been apparently squarely on the side of the investors, corporatists and bankers. Those of the masses who supported him in the last two elections have received little but empty promises and rousing speechifying. They appear forgotten and ignored in Obamas world view.

Johnston points out that the INVESTOR CLASS should be happy with Obama...the Dow has risen 126 percent while Obama occupied the Oval Office. While the CORPORATE WORLD is giddy with their massive profits which have doubled..under this President. FISCAL HAWKS who fume and fuss about the debt should gloat...our federal budget deficit has shrunk from 10% down to 3% in fiscal year 2015 (note that year began in October 1, 2014). The Affordable Care Act. which everyone loves to hate, tickled the funny bone of one group of WEALTHY INVESTORS. The ACA was a financial boon to the large INSURANCE COMPANIES . They made a killing when Obama refused to go with the "single payer" plan which would have closed the door on their lucrative business. Instead he curried favor with the insurance giants and their powerful and financially connected interests by giving in to those who favored the more costly and less efficient system we have in "Obamacare". Wall Streeters were a as happy as pigs in swill, when he gave away the store to the BIG BANKS with the "stimulus package" issued during the Great Recession---the melt down in 2007-2008. That financial debacle was in large part generated by the financial sector's questionable and unethical investments selling so called "derivatives", such as bundled sub-prime mortgages. During his tenure, to add insult to injury, OBAMA's AG, Eric Holder, refused to prosecute even blatant banking and business crimes. Ignoring the glaring issues of the led up to the Recession. And as if to put the icing on the cake for the Wall Streeters, and to underscore the fact that this Administration cares little for the stability of the banking system and is more concerned with currying favor with this powerful element of the economy, just last month the President signed the CRomnibus budget bill which actually APPROVED THE USE OF DERIVATIVE GAMBLING permitting the bankers to too casually use taxpayer insured bank deposits. In doing so Mr Obama has insured continuation of theses practices, which precipitated the Great Recession. This proves that he and his advisors have either learned nothing from our recent financial history --or that these industries are so powerful that no one in Washington can rein them in. (The term CRomnibus, is Washspeak for "CR" (continuous resolution) and "omnibus" Bill. It is a devilishly complex bit of legislation described by some as the cowardly means by which the government proceeded to insure that the Administration would meet its debts).

So all the big shots should be quite happy with the efforts of Mr. Obama. The average citizen, the little people, the poor, the middle class, the workers, the unionists, and even the African Americans, all those who actually elected this man, are still holding the dirty end of the stick. These latter folks lost their jobs, and some their homes. Their incomes have evaporated, or fallen, or have been essentially frozen over the period of Mr. Obama's tenure. Today six years into the administration of our first Afro-American President they are required to work longer hours, or two jobs for the same or less pay, and struggle just make ends meet.

At the end of the Bush Administration the nation lost more than 4 million jobs. After six years of Obama's "Hover like" inaction and timidity on behalf of the nation's working classes, and small business man, the vast majority of our people are still suffering. Median income is today as I write this are down by nearly $5000 dollars. That is not a great sum so the nation's overcompensated CEOs...but to a man or woman who makes the median income of $54,000 dollars it is a great sum.

So how can we answer the question of why Obama is so unpopular? One must answer that the tiny percentage of the nation who are the recipients of this President's welfare are greedy and ungrateful. They were doing well and are now doing several times better than before. But the vast majority of the Citizenry--those who stoke the engines of the economy with their purchases and their labor-- the vast majority of the population...the average Joe, the worker, small business man, the poor, the needy, the Middle Class...the rest of the nation...are still waiting desperately for succor.
Perhaps Mr. Obama can still fulfill his promises and his job description and find some means to improve the welfare of the people who supported him, and who today desperately need his help.
rjk