Too many questions and not enough answers

While I should be upbeat about the 105th consecutive month of economic growth in the US, the still very high stock values in the market on an uptick since January 2009 and the historically low unemployment rate, I know that too many folks are not feeling the love from this growth. But, I want to set this issue aside for now and just ask some “why” questions as I am beyond frustrated with our failure to address too many issues.

Why can’t our so-called leaders address our never ending gun violence in the US? Yesterday’s tragedy will happen again, just like what was predicted following the last one a few weeks ago. Our so-called leaders are too busy trying to keep their job and need to do their job. It is more than a gun issue, but we need to do something about various causes. Our GOP friends like to say it is a mental health issue, but then try to repeal the ACA and not encourage the expansion of Medicaid. And, Congress permitted last year folks on Social Security disability for mental health reasons to be added back to eligible gun buying rolls.

However, it is a gun access issue as well and the majority of Americans support background checks on all sales and elongated waiting periods. I would do more, but these are “no-brainers.” Yet our spineless Congress and President will not act. Part of my thoughts and prayers are for our leaders to grow a backbone and do something. We need not worry about foreign terrorists as our domestic terrorists do just fine without them in killing innocent Americans.

Why do we fail to act on Russia interfering with our democracy? The leaders of our intelligence agencies testified under oath to the Senate Intelligence Committee that not only did the Russians influence our 2016 election, they are continuing to sow seeds of discord driving Americans apart, and will influence the 2018 election. Yet, the President does not want to talk about it and did not extend the Congress approved sanctions on Russia two weeks ago. I would add that Congressman Nunes who is the head of the House Intelligence Committee and author of a memo that has been criticized by the FBI as inaccurate is refusing to call for a similar briefing under oath. It is surmised he is fearful of the same leaders disparaging the veracity of his memo. Is it not the job of the committee to get a briefing or should we just ask Sean Hannity to do it?

Why does are debt problem not elicit more reaction from the public? My former GOP party seemingly no longer cares about the deficit and debt since we have a Republican President. We have made our massive debt problem worse with the last two major pieces of legislation, but it does not seem to matter to the public or these so-called leaders. Both parties are to blame, but taxpayers will be left holding the bag as we have further mortgaged our future to heat up a good economy. It makes no sense, unless you look at this through a donor’s lens, which is the real reason for the tax cuts.

Why do we allow EPA DIrector Scott Pruitt to lie so much about climate change without repercussion, echoing the lines of his boss? Like the debt, our so-called leaders are ignoring a growing problem. It would be nice if they helped, but Pruitt and Trump are being left at the kids’ table, while the grown-ups move forward. Fortunately, the cities, states, universities and companies are moving forward with renewable energy and conservation measures. The renewable cost is more comparable to fossil fuel cost and they do not leave a negative footprint. Plus, when the present value costs of environmental degradation, clean-up and risk are factored in, renewables are cheaper. We could do so more with federal leverage, but at least the President has galvanized other to act since he won’t.

These issues are four of several that need to be addressed, but are not. Our democracy and planet our under attack. These should not be partisan issues. I am independent former Republican voter and these are representative of the issues I am trying to increase awareness of. Ask your legislators what they plan to do about them. If they do not respond or respond to another question, find out who is running against them. A good thing created by this President is very qualified people will be running for more offices.These are real issues. Let’s work on addressing them.




Headwinds and Tailwinds to the Economy

Presidents get too much credit and blame for the economy. They can provide headwinds and tailwinds, but global market forces tend to control what happens. By headwinds, I mean the wind is against the economic growth, with tailwinds aiding economic growth.

In the US, we are under the third longest economic growth period in our measured history with 103 consecutive months of growth. We have also had seven consecutive years of 2 million plus jobs created. And, the stock market more than doubled under Obama and continues its rise under Trump. These are great numbers. But, before we pat ourselves on the back too much, not everyone has benefitted and wealth disparity among economic classes has been widening for the past thirty-five years.

Economists I have watched project the good news to continue for the year, but several have cautioned about the future and if we don’t address the inequity, we will have major problems on top of other concerns.

On the tailwinds ledger, the global economy continues to grow and the World Economic Forum projects a 3.9% increase for the year. In the US, the cut back on regulations, plus the reduction in new ones over the rates of the past, have given more confidence to businesses (more on this later). Plus, the reduction in corporate tax rates will help fuel some growth, provided these companies who are sitting on cash, choose to invest it in their people and business. And, with more money in many people’s pockets, this will add some fuel.

On the headwinds ledger, several economists have noted we are robbing Peter to pay Paul, leveraging our future with even more debt. Not only did we not address the expected increase in debt taking it from $20 trillion to $30 trillion in 2027, the tax law will increase it by $1.5 trillion. The interest cost thereon will take a greater bite out of our budget. But, other headwinds are of concern. Retrenching from global markets and trade agreements replacing them with binary ones, will be dilutive to growth. Not investing as much in science and innovation is a major concern to Joseph Stiglitz, a Nobel laureate in economics.

This will be heightened if we restrict immigration. What seems to get lost in the argument where some have become too cold-hearted in my view, is immigration is accretive to the US economy. Plus, the people immigrating tend to be more entrepreneurial and better educated, in many cases. These sh**hole countries that someone demeaned are sending us more educated people than reside here in the states, on average.

We should not fail to remember that “innovation is portable” so says David Smick, an economic advisor to Ronald Reagan, Bill Clinton and Jack Kemp, one of the smartest Congresspersons who considered a run for President. If we do not provide an inviting place, innovation may be hindered. I should note that Steve Jobs was born to Syrian immigrants to the US. What if they had been denied entry? Apple might not have ever come to fruition.

Finally, not all regulations are bad, so restricting regulations may cause headwinds down the road especially with more freedoms given to pollute the environment and take advantage of customers. This is a developers mindset. Remove obstacles to build, but leave the clean up for others. Unfortunately, we taxpayers are the others. We citizens, that must drink and breathe more polluted waters and air and realize the impact of climate change, are the others. As coal ash deposits have taught us, there is a cost to environmental degradation.

So, we need to be mindful of what we are facing. I have communicated with numerous Congresspersons, Senators and the President, that we are avoiding some elephants in the room – debt, climate change, water crisis and income inequity. In my view as an Independent voter, passing a tax law that increases the debt was extremely poor stewardship, as we cannot cut our way out of this problem. The math won’t work.


Good energy news on this cold, snowy day

Global citizens are rightfully concerned the US President is pulling the US out of the Paris Climate Change Accord, but progress continues as “we are passed the tipping point on renewable energy.” Even the US pullout cannot stop the train, as states, cities, businesses and other countries continue the push. It just means the President and his team will not be at the adult table on this issue and may not be invited at all.

Here are a few miscellaneous energy tidbits that should offer encouragement.

Per the UK Based organization Carbon Tracker, here are a few highlights from the past year:

  • more than 1/2 of the US coal plants in existence in 2010 have been closed;
  • more than 1/2 of the remaining coal plants in Europe are losing money;
  • the UK has slashed electricity from coal usage from 40% to 2% in the last five years; and
  • there have been big strides in China and Australia on reducing coal usage.

Per the Federal Energy Regulatory Commission, the five member, Republican dominated agency denied the request by Department of Energy Secretary Rick Perry to fund the building of more coal-fired and nuclear plants. This was a surprise move given the make-up of the committee. I would call this decision as not wanting to throw good money after bad.

It should be noted, it is not just coal that is giving the FERC commissioners pause. The US division of Westinghouse Electric Company had to declare bankruptcy for cost overruns on a new nuclear power plant for SCANA, the South Carolina utility. As a result, the new plant is being shuttered and SCANA is being sold to Dominion Resources, so as not to overburden SC citizens with the cost of the lost investment.

The International Energy Agency in their 2017 Energy Outlook notes the cost of new solar photovoltaic electricity has declined by 70% and wind energy has fallen 25% since 2010. It should be noted the IEA has tended to favor fossil fuel energy in past releases. China, the new country leader in the climate change fight, will be investing US$360 billion more in renewable energy by 2020. Plus, the price of solar has fallen so much in places like Zambia, Saudi Arabia and Mexico, it has won bidding contests against fossil fuel energy sources for projects.

Finally, any discussion on future energy cannot exclude the declining cost and increasing capacity in battery storage. Per Bloomberg New Energy Financials, energy storage will double six times between 2016 and 2030. Elon Musk just helped southern Australia go live with a major battery installation and 21 states in the US have planned projects on energy storage.

All of the above stories are important because it has always been a financial argument to combat the environmental concerns, whose long term costs have been undervalued. Now, the financials are favoring the renewable energy engine, so market forces will continue to force the ultimate demise of coal-fired energy, which started with the lower cost of natural gas. If a company can find a clean energy source which is cheaper and more predictable long term, that is easily the better path forward. If you don’t believe me, just ask companies like Google, Facebook, Walmart and IKEA to name only a few.



A few straightforward suggestions to fight poverty

“If incarceration had come to define the lives of men from impoverished black neighborhoods, eviction was shaping the lives of women. Poor black men were locked up. Poor black women were locked out.”

The above quote comes from the Pulitzer Prize winning book “Evicted” by Matthew Desmond. Its subtitle is also telling – “Poverty and Profit in the American City.” The dilemma is we have a poverty problem that stretches from urban to rural America. Yet, it manifests itself daily in the eviction courts of American cities and towns, whether it is from apartments, houses or mobile homes.

The book speaks of how fragile the rental community is regardless of race, yet the black community tends to have a higher rate of exposure to evictions in urban areas. Unexpected expenses, transportation problems, and tragedies can push people paying a very high portion of their rent over the edge and out the door. Ideally, 30% of family income should be toward housing and utilities. Too many of these folks are paying well above that percentage.

It should be noted that there are other drivers of fragility. Some have opioid and other dependencies. Some are fragile due to too many children that stretch the budgets of even the best planners. Some are in downward spirals with unsupportive landlords. And, many of those unexpected expenses that arise are healthcare related.

What are some suggestions to remedy these issues? Based on my experience as a volunteer Board member helping working homeless families and my reading, I would like to throw out some ideas for consideration.

First, we need to talk more about it. America has a huge disparity in distribution of wealth which is not talked about enough by leaders. Where and to whom one is born are greater predictors of success as the American Dream  has waned for too many.

Second, we need to fund more family planning efforts not less. There is a high correlation between poverty and large families. When family planning is funded and birth control access and education are increased, poverty declines, system health care costs decline and abortions decline.

Third, more mechanisms to reduce evictions need to be in place and funded. Crisis assistance funds show success in helping keeping the electricity on and, when funded, reducing the number of evictions. Stopping homelessness (or fragility) before it starts can make a huge difference and will have a positive echo effect.

Fourth, we must invest in impoverished  areas making them more suitable for families both with opportunity and resources. In their absence, crime and other poor influences fill the void.

Fifth, while I have concerns about the new Tax law with its impact on debt and heavy emphasis on the wealthy and corporations, a huge opportunity was missed when we could have added an increase in the minimum wage tying it to automatic increases due to wage inflation. I worry that less money than expected by the law’s drafters will end up in the hands of workers.

Sixth, we must address our opioid crisis in America. To be frank, cutting access to healthcare and mental care insurance benefits are not the answer. We must stabilize access and cost of healthcare, yet opposite measures have been taken in the past few years under the guise of political gain.

There are many more ideas, but these will help. On the investing front, many locations have seen success with using historical tax credits leveraging private money. There is a concept called ABCD (Asser Based Community Development) which shores up or repurposes an deteriorated asset creating jobs.

But, first we need to talk about this real and pervasive problem.




If you give a mouse a cookie

The childhood book by this name reveals that some are never satisfied when you do them favors. I was thinking of this as I thought of the litany of things done by a self-promoted populist on behalf of his true benefactors, the wealthy mice. He started with cookies, but the list goes on.

If those onerous environmental regulations were getting in the way, he just rolled back a few of them. Plus, if those scientists and their data were problematic to polluting businesses, he just fired a few, ran off a few and deleted access to important research data.

If access to public lands and what lies thereunder was a roadblock, he just cut back on the national parks and gave easier access to developers. What is land, if it cannot be exploited for short term gain? As a rancher put it, when the developers come, the profits go to Houston and Calgary, but the degradation is left for them long term.

If paying taxes is preventing investment in employees or business, even though conpanies are sitting on cash, then he gave the mice more money. The key is how much will flow into investment and employees and how much will be used to make the executives look good?

Along the way, there are some photo ops to say look what is happening, but the mice seem to be the ones who are getting the cookies and added benefits. As one energy consultant noted, the President has done a lot for coal owners, but not much for coal workers.

I am all for making things easier, but we need smart regulations that protect Americans from short cutting and corruption. We must pay for things as well, and debt and environmental costs are dear. Saying they don’t matter is poor stewardship as our children and grandchildren will have to pay the price for our avoidance.

Three More Renewable Energy Tidbits

In an effort to highlight continuing good news on the renewable energy front, here are three new stories. First, Google has now invested more than twice the nearest company or organization in renewable energy. Google can claim that they generate enough power through renewable energy to cover 100% of their global electricity needs in data centers and offices. Amazon does a lot as well, but they are in a distant second.

Second, Elon Musk’s Tesla Company is primarily a battery company parading as an electric car company. Last week, forty days ahead of schedule, Tesla switched on a 100 MW lithium ion superbattery storage facility in Southern Australia, which will help power 30,000 homes through renewable wind energy provided by French company Neoen. Musk said in the spring if they could not deliver on the promise in 100 days, the batteries and installation would be free.

Third, last week in Miami, the second annual conference on Companies vs. Climate Change was held. Companies like Ford, GM, Walmart, and Mars, e.g. were in attendance. While all regret the President announcing the US pull out of the Paris Climate Change Accord, they are not letting that stop their movement down the path of battling climate change.

It would be nice if the President supported global efforts, but he cannot stop the significant progress that is occurring. And, as one climate scientist has said, Trump did everyone a favor by the announced withdrawal, as it has heightened the urgency and brought even more attention to the problem.

Let’s keep up the momentum.

A few painful truths

We are overlooking some very painful truths primarily for short term gain. As I chatted with staff members for several US Senators, I found myself saying “you sound like a young person; you do realize we are leaving this problem for you?” I hope they start thinking more about what I said because of what we are ignoring.

The reason for my question is Congress has passed one Tax bill and is debating another that will increase our $20.5 trillion debt by at least $1.5 trillion. Yet, not only are we ignoring the $20.5 trillion debt, we are ignoring that the Congressional Budget Office projects that figure to grow by $10 trillion without the Tax bill impact. So, in 2027, the debt could be $32 trillion if the Tax bill is signed into law. This is beyond poor stewardship – it is malfeasance. We would be screwing those young staffers I spoke with.

Unfortunately, there is more. Our leadership has decided to make the US the only country in the world to not support the Paris Climate Change Accord. Not only are we denying hard truths and overwhelming scientific evidence, we are shooting ourselves and planet in the foot. Renewable energy is passed the tipping point and we risk getting left behind as other nations invest in Innovation for the new economy. Fortunately, cities, states and businesses are carrying the banner dropped by our leadership, who is being relegated to the kids table at Thanksgiving. At the next post-Paris event, the US may not be invited at all. If we don’t deal more decisively with climate change, we will be screwing those young staffers and their children.

A final issue to mention, but not the final problem we are ignoring, is the US is retrenching from our global leadership role to the delight of China and Russia and chagrin of our western allies. The President gave a speech in Vietnam this month similar to the one made in Davos earlier in the year. America will retrench to a nationalistic country seeking bilateral agreements. On each occasion, his speech was followed by Xi Jingping who gave the global leadership speech the US normally gives. What our President fails to understand is globalization lifts all boats and our economy benefits more than if we look to maximize only our share. This concept has been called the “Nash Equilibrium” in honor of the Nobel Economics prize winner who developed it, John Nash. If we retrench, we will be harming our future growth and screwing those young staffers.

As I mention, these are not the only things we are ignoring – poverty, job losses due to technology advances, healthcare costs, environmental degradation, infrastructure, better gun control, etc. Yet, should we not alter our path set by these leaders, this path will be defined in the future as the period when the US gave up its global leadership role. And, the world will be a lesser place because of it. Sadly, I have witnessed these words spoken by more than a few global financial and security experts.