Musings at the start of summer

The longest day in the Northern Hemisphere is upon us. Maybe with this extra daylight we can have more illumination on issues. It seems we have a bad habit in our country of governing off rhetoric rather real information.

Saying it more basically, we believe our own BS. It is puzzling why we would make decisions off stuff we made up. Yet, that gets to the heart of the matter. The authors of change don’t necessarily want to solve the problems. They just want to win the election game of optics.

A good example is the secretive Senate effort to develop a repeal and replacement bill for the ACA. The effort has several of the remaining Republican and all of the Democrat Senators up in arms. What is missing is open and honest debate. What is missing is open acknowledgement of Republican efforts to strangle the imperfect law by withholding money from insurance companies promised them to take on adverse selection (higher risk).

Another good example is withdrawing from the Paris Climate Change Accord where America abdicated a global leadership role. While the President and EPA Director tell us there is not consensus on man’s influence on climate change, they fail to tell us that there is an overwhelming consensus from the scientific community. They also fail to heed the recommendations of countless companies, cities and states to remain, including ExxonMobil and Royal Dutch Shell. The sad part is the job growth and investment in renewable energy is growing rapidly and large companies like Amazon. Google, IKEA, Walmart et al are leading the way.

Let’s hope our myopic leaders will use today’s extra sunshine to see the light.

A Tale of Five Cities

I am often bemused by folks that argue against renewable energy citing costs and jobs. Some say the industry is fledgling, but this does a disservice to the huge progress made over the last five years. Renewable energy jobs are growing at double digit rates per annum and the production costs continue to fall and are much closer to fossil fuel costs, and even cheaper when the present value of all costs (environmental degradation, extraction, transportation, maintenance, health care, litigation, et al) are factored in.

Yet, let’s set that aside and consider five cities in the US – Aspen CO, Burlington VT, Greensburg KS, Houston TX and Las Vegas NV. The first three cities are fully powered by renewable energy, where the last two have significant renewable energy portfolios.

Burlington was the first city to claim being 100% powered by renewable energy – solar, wind and hydro-electric. Per a November, 2016 Politico article, the electric utility has not had a rate increase in eight years for its 42,000 residents.

Greensburg came next, unfortunately they had to experience a tornado that leveled the town. As they rebuilt the town, they did so with a green mindset. So, using solar and the heavy wind across the plain states, helped electrify the town with renewable energy. Starting from scratch let them build for the future.

Aspen was the third city. I find this interesting as I read an article a few years back over the concern of climate change on the skiing industry. More often, climate change impact focuses on coastal cities. This city acted and has now pushed the envelope to 100% renewable energy.

Which brings me to Las Vegas. They got press stating they were 100% renewable energy powered, but that was somewhat of a misnomer. Yet, what they did do is still impactful. The 140 municipal buildings and facilities are now 100% powered by renewable energy. That is not the rest of the city, but it is a statement nonetheless.

Finally, let’s visit Houston, deep in the heart of oil rich Texas. Per The Guardian in an article this week, Houston is the leading city in the US in producing renewable energy through wind and solar power with 1.1 billion kWh. 89% of its electricity is renewable energy powered. They are in the top 30 in the EPA’s list of Green Partners leading six Texas cities on this list. As I mentioned recently, Texas gets just under 13% of its electricity from wind energy.

These are powerful stores, pun intended. Please remember them and tell others. We are passed the tipping point on renewable energy and we should highlight those leading the way.

The exact opposite of what is needed

Since tribal fervor gets in the way of good information sharing and debate, we end up with laws, bills and executive orders/ comments which are the exact opposite of what is needed. This troubles me greatly, as if you took the time to look at data and explained what the change would do, people would not be supportive of the change.

Here are a few working examples:

– Treating Muslim Americans poorly, blocking travel from Muslim countries, and criticizing the London Mayor who is an exemplar of successful Muslims in the western world make us less safer. Ostracizing Muslims feeds into the recruiting messaging for Islamic extremist groups; welcoming Muslims and involving them in conversations and diligence is making us safer.

– Defunding Planned Parenthood will increase the abortion rates, health care cost and poverty. Poverty is highly correlated with larger family size. Family planning reduces the number of unwanted pregnancies. Plus, women’s health for low income families improve which saves money.

– Cutting back on renewable energy investment and tax breaks will be dilutive to job increases and rural economies. Many of the solar and wind energy jobs are occurring in rural settings where they are needed. The market for solar and wind energy continues to rapidly grow as the prices fall. Investment in these areas is accretive to growth.

– Regulation is not the enemy. Inefficient and ineffective regulation are. Dodd Frank needs improvement, but we need to be mindful of the changes. The ACA needs improvement, not repeal. Very few industry leaders advocate for regulation – it does not mean they don’t need them, especially when greed exists. We need to govern our regulation either paring, repealing or improving where needed. Here is an example – when Erskine Bowles was asked to head the Small Business Administration he reduced the application for assistance from 42 pages to two.

– Pulling back from global leadership will make the world less safer. America helps provide guardrails to global crises. The more we abdicate responsibility, the less safe it becomes for America and the rest of the world. We must be engaged and collaborative.

I have many other examples. What do you think? What are your examples?

 

While we are asking questions

There will be a great deal written about Former FBI Director James Comey’s testimony under oath. I emphasize the last two words of the preceding sentence. The President and his advocates’ rebuttals will not be under oath, at least at this time, so we should remember this fact.

Yet, it got me to thinking about asking various people a question under oath to see how they would fare. In no particular order:

Senator Marco Rubio, you have bragged on playing a heavy role in the federal government stiffing insurance companies for taking on adverse risk under the ACA. Can you explain to Americans why they must suffer with higher insurance premiums for you to score political points?

Senator Mitch McConnell, The New York Times reported that just before the 2012 election, you had a report by the Congressional Research Service buried that concluded trickle down economics does not work. In light of the recent failures of that approach in Kansas, where tax rates have just been increased to pay for services, does that seem dishonest to hide such information from Americans, especially since the President’s tax plan had some of Kansas’ ideas?

Former President Barack Obama, do you feel remorse about not pushing the Simpson-Bowles Deficit Reduction plan back when it might have gotten some footing and we could have done more with our debt?

Former Senator and Secretary of State Hillary Clinton, while you may have reason to raise issues about the election, would you say that you ran a poor campaign, not focusing on states that you took for granted such as Wisconsin, Michigan and Pennsylvania while you tried to win states like Arizona? Do you feel you let your opponent speak to the disenfranchised voter more than you did?

Senator Ted Cruz, you single handedly shut down the government in October 2013, almost causing us to default on our debts until ten female senators broke the impasse. Do you feel that showed you as part of the problem with Washington? Why should we trust your judgment?

President Donald Trump, since you have been shown to lie about 70% of the time as a candidate and incumbent and your five biographers all note you have a problem with the truth, why should we believe what you say just about anything?

There are more folks I would like to ask questions of. Let me know some of yours.

 

Nicaragua, Syria and the USA

The company you keep matters. Rather than be in the company of other world leaders to help save the planet, the President of the United States decided to be in the company of Nicaragua and Syria. It should be noted Nicaragua wanted the Paris deal to go further. So, we are joined at the hip with Syria.

Going against the wishes of the majority of Americans and even a majority in his own party, the current incumbent in the White House decided to withdraw the United States of America from an agreement it helped forge with China.

Rather than work with others under the Paris Climate Change Accord, the President has decided the children and grandchildren of the world do not matter. He has decided that reneging on a major step forward is better than working with others. His reasons ring hollow, especially when he speaks of his actions to help the environment and trying to save an industry that market forces are diminishing the demand.

I feared this decision from well before the election. Fortunately, we are passed the tipping point on renewable energy as costs continue to fall. Fortunately, businesses are telling him they are not changing forward moving plans because that is what their customers want.

What is most interesting about the timing, two days ago, over 62% of Exxon-Mobil shareholders overruled a management recommendation and said they must report to shareholders the impact climate change is having on their business. This follows similar votes at Occidental Petroleum and PPL, a Pennsylvania based utility. So, owners of companies are making a statement as are customers.

It is a pity that this President has cemented his legacy with such a horrible decision for our country and planet. He will not be remembered well and it has already begun. He should have listened to his daughter, whose children will have to hear how their grandfather harmed the planet.

A mean spirited, dishonest budget

On PBS Newshour last night, Mark Shields and David Brooks defined the President’s budget succinctly. They said it was a “mean-spirited, dishonest budget.” I had been searching for the right words to define a proposed budget that kicks people in poverty in the teeth. Fortunately, Senator John McCain said the budget was “dead on arrival.”

The budget is bothersome in so many levels as it severely cuts Medicaid and food stamps, as well as other programs. The latter has grown because of the greater number of people in need. Yet, while these cuts are occurring, tax breaks for the wealthy would be provided.

But, it does not end there. It has been reported about the extra rosy and very hard to achieve projections on revenue growth. While this is not too uncommon, it is still sleight of hand. When people say tax cuts pay for themselves, that is as believable as the check is in the mail. The Committee for a Responsible Federal Budget will say there often are some revenue improvements, but nothing near paying for the entire cut.

Yet, there is more dishonesty. Former Secretary of the Treasury, Larry Summers said in an op-ed piece in The Washington Post that there is some double counting of revenue sources, an obvious error. Per Summers, “You can’t use the growth benefits of tax cuts once to justify an optimistic baseline and then again to claim that the tax cuts do not cost revenue. At least you cannot do so in a world of logic.” Summers noted he has not seen something like this in a budget proposal in 40 years and a business person should know better than to double count like this.

To be brutally frank, this is not what the President advertised in the campaign. He touted his business leadership as something the country sorely needs. Yet, former Speaker John Boehner said with the exception of foreign policy, Trump’s presidency has been a “complete disaster.” I would argue his point on the foreign policy omission. But, it should be noted is how this budget, the AHCA bill, and other measures harm the very constituents that rose up to vote for this newcomer. He is screwing them and they still lack awareness that is what he is doing.

Getting back to Brooks, I have cited his earlier observation after the horribly planned and executed travel ban. “This White House is equal parts chaos and incompetence.” Summers used the latter word in his piece, as well. We can now add “mean spirited and dishonest.” These are not words that he had hoped to elicit when elected.

 

 

Interesting thing is happening at energy company shareholder meetings

An interesting development occurred at annual shareholder meetings of two major companies in the energy business – PPL Corp, a utility serving Pennsylvania and other states and Occidental Petroleum Corp. A shareholder instigated vote took place at each firm and passed over the recommendations against it by their Boards of Directors. The proposal is for each company to share formally a report on what they intend to do about climate change.

Per the website “Financial Advisor” the following was reported earlier this month about the Occidental vote:

“The proposal received the backing of Occidental’s largest shareholder, $5.4 trillion asset manager BlackRock Inc. BlackRock, which owns a 7.8 percent stake in the oil explorer, said it took action due to the “lack of response” on the issue by the company and a lack of improvement in its climate-change related reporting following a similar proposal last year which received more than 40 percent support.”

The shareholder proposals are at the impetus of CalPERS, one of the largest pension trust funds in the world and a major investor in each company. Other state pension trust funds are supportive of CalPERS’ push. A similar vote was taken recently at Royal Dutch Shell and was defeated, with another vote scheduled at ExxonMobil. It should be noted that institutional investor groups are recommending against these proposals, but two have passed.

With a White House at odds with the rest of the world on climate change, we will need a groundswell of advocacy. Fortunately, we are passed the tipping point on renewable energy due to falling prices and rapidly increasing jobs. And, some of these same companies are advocating the US stay in the Paris Climate Change accord. Yet, the US cannot leave the table. To assure that we remain, we need these kinds of shareholder votes and other advocacies.

The White House has now canceled two meetings to discuss the future of our involvement in the Paris Climate Change. I believe this is in reaction to the push back from business. We cannot backtrack on this and other environmental issues. Let’s push forward and, if the President does not want to play a role, we and the rest of the world can leave him behind.