Archive for the ‘energy’ Category

Obama’s Biggest Challenge of All: China

November 29, 2008

The single most important challenge for the new administration—one with the potential to shape the 21st century—is China. As goes China, so go 1.3 billion men, women and children—one out of every five people on the planet.

China’s economy is now roughly half the size of America’s; in three decades, the two are likely to be about equal. What the Chinese eat, how much (or whether) they drive, where and how they choose to live, work and play: all will have an enormous impact on the availability and price of energy, the temperature of the planet and the prosperity of mankind.

By Richard Haass
Newsweek

Beijing’s foreign policy is no less important. A cooperative China could help stem the spread of nuclear materials and weapons, maintain an open global trading and financial system, secure energy supplies, frustrate terrorists, prevent pandemics and slow climate change. A hostile or simply noncooperative China, on the other hand, would make it that much more difficult for the United States and its allies to tame the most dangerous facets of globalization. But the emergence of a cooperative China is anything but inevitable. That is why Washington needs a new approach to Beijing. Think of it as “integration.”

In this March 31, 2008 file photo, a worker on a boat clears ... 
A  worker on a boat clears garbage from the Yellow River in Lanzhou in northwest China’s Gansu province. Newly released survey results show water quality along one third of China’s famed Yellow River has fallen below the lowest levels measured due to massive pollution. China’s second-longest river has seen its water quality deteriorate rapidly in the last few years, as discharge from factories increases and water levels drop due to diversion for booming cities.(AP Photo/File)

Integration should be for this era what containment was for the previous one. Our goal should be to make China a pillar of a globalized world, too deeply invested to disrupt its smooth functioning. The aim is ambitious, even optimistic, but not unrealistic. The United States and China need each other. Neither wants to go to war over Taiwan, to see another conflict on the Korean Peninsula or to see world oil prices quadruple as a result of a military strike on Iran. Even more than that, China needs access to the U.S. market for its exports in order to maintain economic growth and domestic political stability. Americans, in addition to benefiting from low-cost Chinese imports, need Beijing to manage its large dollar reserves responsibly.

Americans must accept China’s rise. There’s no guarantee we could prevent it anyway, and the attempt would only worsen the rivalry. We should not exaggerate China’s strength or the threat it poses. China’s military, for all its improvements, is still a generation behind America’s. And we should resist any calls to block China’s access to the U.S. market. Trade and investment aren’t just beneficial on their own terms; they also contribute to the web of ties that would bind China into an orderly world order.

Read the rest:
http://www.newsweek.com/id/171259

Chinese People's Liberation Army troops stand in their formation ... 
Chinese People’s Liberation Army troops stand in their formation at a parade ground during the annual rotation of military personnel in Hong Kong November 25, 2008.REUTERS/Alex Hoffard/Pool (CHINA)

Economy won’t stop Obama’s priorities, aides say

November 9, 2008

The economic crisis will not stop President-elect Barack Obama from expanding health care, overhauling education and energy policy, and passing a middle-class tax cut soon after he takes office in January, senior aides said on Sunday.

Meanwhile the U.S. Congress should act to ease the pain of an economy sliding into recession by extending unemployment benefits and boosting aid to states struggling to meet their health-care obligations, they said.

Obama’s transitional team has outlined an ambitious agenda for the next several months as it scrambles to assemble an administration in the face of what is widely viewed as the worst economic slump since the Great Depression.

By Andy Sullivan, Reuters

The economic crisis will not prevent Obama from pursuing the priorities he outlined on the campaign trail, said John Podesta, co-chair of Obama’s transition team.

These include extending heath care to the nation’s 47 million uninsured, reducing U.S. reliance on foreign oil, and improving public education, Podesta said.

“These are all core, if you will, economic questions and they need to be tackled together, and I think you’ll have a program, and a strategy to move aggressively across all those fronts,” Podesta said on CNN’s “Late Edition.”

Congress is expected to return in a temporary session as soon as next week to take up a stimulus package defeated by Senate Republicans in September.

That package should not be tied to a free-trade deal with Colombia as some Republicans have suggested, said Illinois Rep. Rahm Emanuel, who will become Obama’s chief of staff when he takes office on January 20.

“You don’t link those essential needs to some other trade deal,” Emanuel said on ABC’s “This Week.”

Read the rest:
http://news.yahoo.com/s/nm/20081109/pl_nm/us_usa_politics_
stimulus;_ylt=AuXMEwYg.GtybLaxEx.SZdGs0NUE

Capitalism, fiscal woes; contempt for economic liberty

November 9, 2008

There has always been contempt for economic liberty. Historically, our nation was an important, not complete, exception. It took the calamity of the Great Depression to bring about today’s level of restrictions on economic liberty. Now we have another government-created calamity that has the prospect of moving us even further away from economic liberty with the news media and pundits creating the perception that the current crisis can be blamed on capitalism.

We see comments such as those in the New York Times: “The United States  has a culture that celebrates laissez-faire capitalism as the economic ideal.” Or, “For 30 years, the nation’s political system has been tilted in favor of business deregulation and against new rules.” Another says, “Since 1997, Mr. Brown [the British prime minister] has been a powerful voice behind the Labor Party’s embrace of an American-style economic philosophy that was light on regulation.”

By Walter E. Williams
The Washington Times

First, let’s establish what laissez-faire capitalism is. Broadly defined, it is an economic system based on private ownership and control over of the means of production. Under laissez-faire capitalism, government activity is restricted to the protection of the individual’s rights against fraud, theft and the initiation of physical force.

Professor George Reisman has written a very insightful article on his blog titled “The Myth that Laissez Faire Is Responsible for Our Financial Crisis.” (http://georgereisman.com/blog/2008/10/myth-that-laissez-faire-is-respo nsible.html) You can decide whether we have an unregulated laissez-faire economy. There are 15 Cabinet departments, nine of which control various aspects of the U.S. economy. They are the Departments of: Transportation, Housing and Urban Development, Health and Human Services, Education, Energy, Labor, Agriculture, Commerce and Interior. In addition, there is the alphabet soup cluster of federal agencies such as: the IRS, the FRB and FDIC, the EPA, FDA, SEC, CFTC, NLRB, FTC, FCC, FERC, FEMA, FAA, CAA, INS, OHSA, CPSC, NHTSA, EEOC, BATF, DEA, NIH and NASA.

Here’s my question to you: Can one be sane and at the same time hold that ours is an unregulated laissez-faire economy? Better yet, tell me what a businessman, or for that matter you, can do that does not involve some kind of government regulation.

Read the rest:
http://www.washingtontimes.com/news/2008/nov
/09/capitalism-and-fiscal-woes/

Russia Aims to Be High on Obama’s Agenda

November 8, 2008

To the extent that he focused on Russia at all, Barack Obama’s attention was concentrated primarily on the need to keep Soviet nuclear weapons stockpiles out of the hands of terrorists.

But now, President Dmitri A. Medvedev of Russia has thrown down a gauntlet intended to demonstrate to the American president-elect that the post-cold war era may not be so post after all.

By Helene Cooper
The New York Times

Russian President Dmitry Medvedev looks at a banknote while ... 
Russian President Dmitry Medvedev has his eye on Russia’s oil, Russia’s money, Russia’s importance in the world and barack Obama; photo taken in St. Petersburg in Russia, Friday, Nov. 7, 2008.(AP Photo/RIA-Novosti, Dmitry Astakhov, Presidential Press Serivce)

On Wednesday, while leaders around the world were falling over themselves to hail Mr. Obama’s election, Mr. Medvedev delivered a harsh welcome-to-the-new-cold-war speech in Moscow.

He never mentioned Mr. Obama by name, but Mr. Medvedev said he would deploy short-range missiles near Poland capable of striking NATO territory if the United States pressed ahead with plans to build a missile defense shield in Europe, something that Mr. Obama has said he supports.

Mr. Medvedev put Mr. Obama on notice on the Georgia crisis as well, vowing that “we shall not retreat in the Caucasus.”

Russia's President Dmitry Medvedev visits cosmodrome Plesetsk, ... 
Russia’s President Dmitry Medvedev visits cosmodrome Plesetsk, October 12, 2008.REUTERS/RIA Novosti/Kremlin/Dmitry Astakhov

Even his one-paragraph congratulatory telegram to Mr. Obama was brusque. “I hope for a constructive dialogue with you, based on trust and consideration of each other’s interests,” Mr. Medvedev wrote.

“It was a giant, ‘Hey, welcome to the game,’ ” said George Friedman, chief executive at Stratfor, a geopolitical risk analysis company. “While Obama would like to deal sequentially with Iraq, Afghanistan and, when he gets to it, the Russians, the Russians themselves want to be a burning issue at the top of his list.”

A general view of the Russia's oil major LUKOIL oil refinery ... 
A general view of the Russia’s oil major LUKOIL oil refinery near the town of Kagalym in western Siberia, July 7, 2004 in this file photo.  (Viktor Korotayev/Reuters)
Russia's "Iskander" missile system on display ... 
Russia’s “Iskander” missile system on display at a military exhibition in the Siberian town of Nizhny Tagil in 2005. President Dmitry Medvedev has said Russia will place short-range missile systems on the EU’s eastern border to counter planned US missile defence installations in Eastern Europe.(AFP/VEDOMOSTI/File/Evgeny Stetsko)

Read the rest:
http://www.nytimes.com/2008/11/08/world/europe/08russia.html?_r=1&oref=slogin

Vietnam Tightens Oil, Energy Ties to Russia

November 8, 2008

Thirty-three years after the fall of Saigon, Vietnam is never far from the American psyche, as witnessed during the presidential campaign. In a frisson of nostalgia for what might have been, U.S. oil companies can only note with regret the announcement last week by the Kremlin that in the wake of talks between the Russian and Vietnamese presidents, their governments have concluded an agreement on further cooperation on geological exploration and hydrocarbon production by their Vietsovpetro joint venture.

For those with a sense of history and irony, in 1975, several months before the fall of Saigon, U.S. Ambassador Graham Martin, commenting on Mobil’s and Pecten’s recent Dua-1X and BH-1X oil well discoveries in the South China Sea off Vietnam, opined that if the South Vietnamese government could hang on, oil revenues from the new finds could benefit from the surge in oil prices in the wake of the 1973 Arab oil embargo to finance the war.

By John Daly
UPI
.
Western geological exploration of South Vietnam’s offshore South Continental Shelf began in the late 1960s. Mobil and Shell subsidiary Pecten drilled offshore in the Nam Con Son and Cuu Long basins and found the largest oil fields in the South China Sea. The prize that they uncovered was significant, with Nam Con Son estimated to contain 20 percent and Cuu Long 30 percent of Vietnam’s total hydrocarbon resources. But the course of the war meant that changing military and political realities would shortly overwhelm both the South Vietnamese government and the dreams of the Western energy concerns.

Saigon fell on April 30, and Martin evacuated on the last helicopter to leave the embassy. Vietnam’s new government immediately canceled all foreign concessions granted by the now defunct South Vietnamese government, leaving Mobil with lost millions in investment and a bunch of now useless geological data.

Visiting Vietnamese President Nguyen Minh Triet, left, hands ...
Visiting Vietnamese President Nguyen Minh Triet, left, hands over a medal to Russia’s OAO Gazprom CEO Alexei Miller in the Moscow Kremlin on Monday, Oct. 27, 2008. Russia and Vietnam agreed Monday to boost their energy cooperation and explore new prospective oil fields.(AP Photo/ Alexander Zemlianichenko)

Read the rest:
http://www.upi.com/Energy_Resources/2008/11/07/Analysis_Russia_and_
Vietnam_deepen_energy_cooperation/UPI-59391226098887/#top

Power struggle may open rift among House Democrats

November 7, 2008

Opening a split among congressional Democrats that could affect President-elect Barack Obama’s efforts to curb global warming, a California environmentalist is trying to wrest control of a crucial House committee from its chairman, who is the automobile industry’s strongest ally in fighting stricter antipollution standards.

By Janet Hook
The Los Angeles Times

Rep. Henry A. Waxman (D-Beverly Hills) has announced that he wants to replace Rep. John D. Dingell (D-Mich.) as chairman of the House Energy and Commerce Committee, which will take the lead on Obama’s signature issues of energy, global warming and healthcare.

Henry Waxman
Above: Henry Waxman

Over the years, Dingell has given invaluable support to the auto companies’ fights against pollution and fuel economy standards that they considered unrealistic, and Waxman’s challenge to his leadership is the culmination of a decades-long rivalry between the two powerful lawmakers, the panel’s top two Democrats.

The outcome of the fight could affect whether action on Obama’s energy agenda will be tilted toward the interests of Rust Belt industrial Democrats or more aggressive antipollution efforts that California has spearheaded.

It opens divisions among triumphant Democrats just as they come off a landmark election that put Obama in the White House and expanded the party’s majorities in the House and Senate — and it is a window into how power struggles among Democrats may intensify now that there is so much more power to wield.

Dingell allies say Waxman’s unexpected move is divisive and will sow dissent just as the party should be rallying together.

“There is no basis for removing Chairman Dingell,” Rep. Mike Doyle (D-Pa.) said in a conference call with Dingell supporters. “The implication that Mr. Dingell wouldn’t move environmental legislation as quickly as Mr. Waxman has no basis in reality.”

In a letter Thursday to all House Democrats, Dingell said he was better prepared to move the Obama agenda and insisted that he was committed to addressing the climate change problem.

“An Obama presidency will allow us to quickly complete our work and protect the environment,” he wrote.

The Obama transition team has not weighed in on the dispute, but the person managing congressional relations for the team is Phil Schiliro, a former longtime Waxman aide. Global warming is a thorny issue for Obama because there are high expectations for him to address the problem. At the same time, Obama carried Michigan and must be concerned about the survival of the U.S. auto industry.

Dingell, who in the Democratic primaries endorsed the presidential candidacy of Sen. Hillary Rodham Clinton, represents a district near Detroit, and the loss of his position would be seen as a blow to the auto industry at a particularly trying time. Detroit is being battered by declining car sales, high gas prices and an economy in turmoil. In a sign of the political sensitivity of the fight, several auto industry spokesmen declined to comment on the choice between Dingell and Waxman.

House Speaker Nancy Pelosi (D-San Francisco) is officially neutral in the dispute, but she is known to be sympathetic to Waxman’s positions on the environment and has repeatedly crossed swords with Dingell over the years:

* In 2002, Pelosi endorsed an unsuccessful primary challenger to Dingell.

House Speaker Nancy Pelosi speaks about economic stimulus plans ...

House Speaker Nancy Pelosi speaks on Capitol Hill in Washington, November 5, 2008.(Mitch Dumke/Reuters)

Read the rest:
http://www.latimes.com/news/politics/la-na-
energy7-2008nov07,0,1179722.story

Iran: OPEC may need further cut if prices drop

November 6, 2008

OPEC may need to cut its oil output more but it remained too early to tell if a further reduction was needed, Iran’s OPEC governor Mohammad Ali Khatibi told Reuters on Wednesday.

“It is too soon to say whether OPEC’s November cut agreement has been successful. We should wait and see,” Khatibi said.

“But if crude prices continue to fall, then an additional OPEC cut may be needed.”

The producer group agreed to cut output from November 1 by 1.5 million barrels per day (bpd) after oil prices dived from a July record of $147 a barrel to less than half that. U.S. crude was trading around $68 a barrel on Wednesday.

Venezuela said on Tuesday it will propose another cut of 1 million bpd at the cartel’s next meeting, which is expected to be held in December.

Iran, the world’s fourth largest oil producer, has already started informing buyers that it is cutting back sales. Iran’s share of OPEC cut was 199,000 bpd.

“Iran and other OPEC members have been committed to OPEC’s November cut agreement,” Khatibi said.

“Creating a balance between oil supply and demand is OPEC’s priority.”

An oil pump decorated to look like a bird stands at rest Wednesday, ...
An oil pump decorated to look like a bird stands at rest Wednesday, Nov. 5, 2008, in oil fields near Awali, Bahrain. Oil prices slid below US$68 a barrel Wednesday on expectations a slowing global economy will cut crude demand, and even indications OPEC is enacting its decision to take a daily 1.5 million barrels from the market failed to support prices.(AP Photo/Hasan Jamali)

Read the rest:
http://news.yahoo.com/s/nm/20081105/bs_nm/us_iran_opec_1

Best Analysis of Obama’s Economic Challenges, From The BBC and Peter Morici, Univ of Maryland

November 6, 2008

This is an audio feed from the BBC, Thursday, November 5, 2008. 

The second audio segment features Professor Peter Morici of the University of Maryland, which is an excellent review of the challenges facing President Elect Obama….

Listen:
http://www.bbc.co.uk/mediaselector/check/worldservice/meta/tx/wbr?nbram=1&nbwm=1&size=au&lang=en-ws&bgc=003399&ls=p23&ls=35603

Oil drops near 6 percent on slumping demand

November 3, 2008

Oil fell nearly 6 percent on Monday as further indicators of falling demand linked to a potential recession offset OPEC plans to reign in output.

U.S. crude settled down $3.90 at $63.91 a barrel, after October saw the steepest monthly price decline ever for oil as global demand slowed. London Brent crude dropped $4.84 to settle at $60.48 a barrel.

By Edward McAllister, Reuters

Oil hit a record $147.27 a barrel in mid-July but has since more than halved as poor economic data added to pressure from weak demand reports in the United States and other key consumer nations.

Oil rigs extract petroleum in Culver City, Los Angeles, April ... 
Oil rigs extract petroleum in Culver City, Los Angeles, April 2008. World oil prices slipped on Monday as traders took profits after a pre-weekend rally, and tracked concerns about the impact of a global recession on energy demand, analysts said.(AFP/Getty Images/File/David McNew)

“The most devastating blow for crude oil today is data showing that U.S. manufacturing activity in October fell to the lowest level in 26 years, which means more worries for oil demand,” said Phil Flynn, an analyst at Alaron Trading, in Chicago.

“Manufacturing used to be a great forward indicator for oil demand, but if the manufacturing sector is down, it will be a struggle to keep oil demand up,” he added.

U.S. factory activity — a barometer for future oil demand — contracted sharply in October, falling to its lowest in 26 years as the financial crisis racked the world’s largest economy.

The Institute for Supply Management said its index of national factory activity fell to 38.9 in October from 43.5 in September. A reading below 40 is exceptionally weak.

BP (BP.L) Chief Executive Tony Hayward estimated U.S. demand has dropped 2 million barrels per day on the year over the last four weeks.

Read the rest:
http://news.yahoo.com/s/nm/20081103/bs_nm/us_markets_oil_9

Obama: ‘I Will Change The World’

November 2, 2008

With just three days to go he and his opponent John McCain are touring key states in an effort to woo undecided voters.

Senator Obama is still almost seven points ahead in the Real Clear Politics poll of polls, but the gap has narrowed slightly.

Don’t miss these other great pre-election treats:
Is The Maverick a Closer, or a Loser? Is Obama the Messiah? Tuesday We’ll Know!

Obama Says Election ‘Vindicated’ His Faith in America

From Sky News (UK)

At a rally in Henderson, Nevada, he warned his supporters against complacency.

“At this defining moment in history, you can give the country the change we need,” he said.

Sky News’ Michelle Clifford, who was at the rally, said Mr Obama was trying to leave nothing to chance.

“He’ll be using every ounce of his resources to get the vote out,” she said.

At the same time Senator McCain was rallying his followers in Newport Beach, Virginia.

In a usually safe Republican state, which is threatening to go to the Democrats, he asked for help on the home stretch.

He said: “Let me state the obvious again, we need to win Virginia on the 4th of November and with your help we’re going to win and bring real change to Washington.

The campaigning has been tough for both men, but Sky News’ Robert Nisbet, who has been following the McCain bandwagon, says the toll is beginning to show on the older man.

“Being on the road at rally after rally is exhausting and Mr McCain appears to be tired,” he said.