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United States - Feb 8

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What’s Missing from the New Clean Energy Agenda?

Sarah Laskow, The Media Consortium
Nuclear power, biofuels, clean coal: These are the Obama administration’s answers to climate change. The 2011 budget, released this week, promised new loans for the construction of nuclear power plants, and on Wednesday the Environmental Protection Agency (EPA), White House, and other departments detailed steps to encourage ethanol and clean coal production.

These initiatives may garner support from conservatives, but their ascendancy comes at a price. Support for renewable fuel sources, like wind and solar, has dwindled. President Barack Obama did encourage Senate Democrats to pass a climate change bill, but some moderates are bucking the cap-and-trade provisions that could tamp down carbon emissions. Those moderates are pushing for legislation that leaves carbon caps out entirely.
(5 February 2010)
Also at Common Dreams.


Soaring cost of healthcare sets a record

Noam N. Levey, Los Angeles Times
Reporting from Washington - In a stark reminder of growing costs, the government has released a new estimate that healthcare spending grew to a record 17.3% of the U.S. economy last year, marking the largest one-year jump in its share of the economy since the government started keeping such records half a century ago.

The almost $2.5 trillion spent in 2009 was $134 billion more than the previous year, when healthcare consumed 16.2% of the gross domestic product, according to an annual report by independent actuaries at the federal Centers for Medicare and Medicaid Services, or CMS, scheduled for release Thursday.

The nonpartisan accounting agency also projected that as early as next year, the country could mark another milestone as government picks up more than half of the nation's total healthcare tab for the first time.
(4 February 2010)


America Is Not Yet Lost

Paul Krugman, The New York Times
We’ve always known that America’s reign as the world’s greatest nation would eventually end. But most of us imagined that our downfall, when it came, would be something grand and tragic.

What we’re getting instead is less a tragedy than a deadly farce. Instead of fraying under the strain of imperial overstretch, we’re paralyzed by procedure. Instead of re-enacting the decline and fall of Rome, we’re re-enacting the dissolution of 18th-century Poland.

A brief history lesson: In the 17th and 18th centuries, the Polish legislature, the Sejm, operated on the unanimity principle: any member could nullify legislation by shouting “I do not allow!” This made the nation largely ungovernable, and neighboring regimes began hacking off pieces of its territory. By 1795 Poland had disappeared, not to re-emerge for more than a century.

Today, the U.S. Senate seems determined to make the Sejm look good by comparison.

Last week, after nine months, the Senate finally approved Martha Johnson to head the General Services Administration, which runs government buildings and purchases supplies. It’s an essentially nonpolitical position, and nobody questioned Ms. Johnson’s qualifications: she was approved by a vote of 94 to 2. But Senator Christopher Bond, Republican of Missouri, had put a “hold” on her appointment to pressure the government into approving a building project in Kansas City.

This dubious achievement may have inspired Senator Richard Shelby, Republican of Alabama. In any case, Mr. Shelby has now placed a hold on all outstanding Obama administration nominations — about 70 high-level government positions — until his state gets a tanker contract and a counterterrorism center.
(7 Feb 2010)


Seven States of Energy Debt

gregor, gregor.us
The inevitable coming of the sovereign debt panic finally engulfed Europe this week as the derisively (or perhaps affectionately) named PIGS spilled their slop on the continent. But Portugal, Ireland, Greece, and Spain are hardly worthy of so much attention. In truth, they are little more than the currently favored proxies among the leveraged speculator community (cough) for the larger problem of all sovereign debt. Indeed, the credit default swaps on these smaller European satellite states were not alone this week in making large moves higher. UK sovereign risk rose strongly, and so did US sovereign risk. With a downgrade warning from Moody’s to boot.

Notable among three of the PIGS are their relatively small populations, and small contributions to either world or European GDP. While Spain has a population over 45 million, Portugal and Greece have populations roughly equal to a US state, such as Ohio–at around 10 million. And Ireland? The Emerald Isle has a population similar to Kentucky, at around 4 million. While the PIGS are without question a problem for Europe, whatever problems they present for Brussels are easily matched by the looming headache for Washington that’s coming from large, US states such as California, Florida, Illinois, Ohio, and Michigan.

I’ve identified seven large US states by four criteria that are sure to cause trouble for Washington’s political class at least for the next 3 years, through the 2012 elections. These are states with big populations, very high rates of unemployment, and which have already had to borrow big to pay unemployment claims. In addition, as a kind of Gregor.us kicker, I’ve thrown in a fourth criteria to identify those states that are large net importers of energy. Because the step change to higher energy prices played, and continues to play, such a large role in the developed world’s financial crisis it’s instructive to identify those US states that will struggle for years against the rising tide of higher energy costs.

...The seven states to make my list are California, Florida, Illinois, Ohio, Michigan, North Carolina, and New Jersey. Each has a population above 8 million people. Each has had to borrow more than a billion dollars, so far, to pay claims out of their now bankrupt unemployment insurance fund. Also, each state currently registers broad, underemployment above 15% as indicated by the U-6 measure for the States. And finally, each state is a large net importer of either oil, natural gas, electricity, or all three of these energy sources...
(5 Feb 2010)

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