July 8th, 2010
While the U.S. has experienced some job creation during the rebound so far, unemployment for America's youngest job seekers continues to get worse, not even slightly better.
That's because the new jobs of today aren't open to them, according to a study called "Unemployment Among Young Workers" by the U.S. Congress Joint Economic Committee:
"Employers added over half a million jobs in the last four months, yet the unemployment rate for young workers reached a record 19.6 percent in April 2010, the highest level for this age group since the Bureau of Labor Statistics began tracking unemployment in 1947... The youngest workers (16 to 17 years) experience the highest rates of unemployment. The unemployment rate for 16 to 17 year olds was 29 percent in April."
The chart below shows how the unemployment rate for America's youngest (in red) continues to get worse, even while other age groups' unemployment rates have plateaued or slightly declined (in blue or green). The rebound so far, however small, hasn't even started for the young.
One reason explained in the report is that older workers are now taking jobs previously reserved for the youngest due to a dearth of opportunities. Another is that industries which employed young workers were hit disproportionately hard during the downturn, such as hospitality and retail. Education is also now more important than ever in securing an available job, with higher education massively reducing one's probability of being unemployed.
Yet education doesn't explain everything. For example, one disturbing figure from the report shows that young black college graduates have double the unemployment rate (15.8%) of other young college graduates. For many of America's budding job seekers such as these, hitting the pavement and trying to work has proven itself completely futile. Take it as a lesson from the New Normal.
July 8th, 2010
Niall Ferguson at the 2010 Aspen Ideas Festival on July 6th. (Photo: Daniel Bayer / Aspen Ideas Festival) Even the Aspen Ideas Festival, an annual gathering of the country's brightest lights, isn't Obama country anymore. Lloyd Grove on the president's waning support among the intelligentsia.
You’d think the well-heeled and enlightened eggheads at the Aspen Ideas Festival—which is running all week in this fashionable resort town with heady panel discussions and earnest disquisitions involving all manner of deep thinkers and do-gooders—would be receptive to an intellectually ambitious president with big ideas of his own.
In a way, the folks attending this cerebral conclave pairing the Aspen Institute think tank with the Atlantic Monthly magazine might even be seen as President Obama’s natural base.
Apparently not so much.
“The real problem we have,” Mort Zuckerman said, “are some of the worst economic policies in place today that, in my judgment, go directly against the long-term interests of this country.”
Obama’s top economic adviser, Larry Summers, and his departing budget director, Peter Orszag, can expect heavy weather when they land in Aspen later this week to make their case to this civic-minded clique of wealthy skeptics.
“If you’re asking if the United States is about to become a socialist state, I’d say it’s actually about to become a European state, with the expansiveness of the welfare system and the progressive tax system like what we’ve already experienced in Western Europe,” Harvard business and history professor Niall Ferguson declared during Monday’s kickoff session, offering a withering critique of Obama’s economic policies, which he claimed were encouraging laziness.
“The curse of longterm unemployment is that if you pay people to do nothing, they’ll find themselves doing nothing for very long periods of time,” Ferguson said. “Long-term unemployment is at an all-time high in the United States, and it is a direct consequence of a misconceived public policy.”
Ferguson was joined in his harsh attack by billionaire real estate mogul and New York Daily News owner Mort Zuckerman. Both lambasted Obama’s trillion-dollar deficit spending program—in the name of economic stimulus to cushion the impact of the 2008 financial meltdown—as fiscally ruinous, potentially turning America into a second-rate power.
“We are, without question, in a period of decline, particularly in the business world,” Zuckerman said. “The real problem we have…are some of the worst economic policies in place today that, in my judgment, go directly against the long-term interests of this country.”
Zuckerman added that he detects in the Obama White House “hostility to the very kinds of [business] culture that have made this the great country that it is and was. I think we have to find some way of dealing with that or else we will do great damage to this country with a public policy that could ruin everything.”
Ferguson added: “The critical point is if your policy says you’re going run a trillion-dollar deficit for the rest of time, you’re riding for a fall…Then it really is goodbye.” A dashing Brit, Ferguson added: “Can I say that, having grown up in a declining empire, I do not recommend it. It’s just not a lot of fun actually—decline.”
Ferguson called for what he called “radical” measures. “I can’t emphasize strongly enough the need for radical fiscal reform to restore the incentives for work and remove the incentives for idleness.” He praised “really radical reform of the sort that, for example, Paul Ryan [the ranking Republican on the House Budget Committee] has outlined in his wonderful ‘Roadmap’ for radical, root-and-branch reform not only of the tax system but of the entitlement system” and “unleash entrepreneurial innovation.” Otherwise, Ferguson warned: “Do you want to be a kind of implicit part of the European Union? I’d advise you against it.”
This was greeted by hearty applause from a crowd that included Barbra Streisand and her husband James Brolin. “Depressing, but fantastic,” Streisand told me afterward, rendering her verdict on the session. “So exciting. Wonderful!”
Brolin’s assessment: “Mind-blowing.”
In a session Tuesday morning, Silicon Valley guru Michael Splinter piled on. “From an industry standpoint, it’s below what a lot of people in industry have viewed as the solution to the jobs problem,” Splinter, president of the Applied Materials solar energy company, complained about Obama’s economic performance. He was speaking to an agreeable audience in an interview with Atlantic Media owner David Bradley. “When I talk to venture capitalists, their companies are starting to move their manufacturing operations out of the United States…Our corporate tax rate, on a worldwide competitive basis, is just not competitive. Taiwan is lowering their rate to 20 to 15 percent in order to stay competitive with Singapore. These countries have made it their job to attract industry. You don’t get that sense here in the United States.”
The consensus was similar in an afternoon panel discussion on the decline of the American middle class. “He said jobs were going to be his No. 1 priority—there’s a huge disconnect between Washington and what’s going on out in the country,” nominal Obama supporter Arianna Huffington said. “The president’s economic team kept talking about a ‘cyclical’ problem. Larry Summers said jobs were a lagging economic indicator. All these things are simply wrong. The president put all his trust in the wrong economic team—an economic team that didn’t understand what was happening.”
Lloyd Grove is editor at large for The Daily Beast. He is also a frequent contributor to New York magazine and was a contributing editor for Condé Nast Portfolio. He wrote a gossip column for the New York Daily News from 2003 to 2006. Prior to that, he wrote the Reliable Source column for the Washington Post, where he spent 23 years covering politics, the media, and other subjects.
July 8th, 2010
Wall Street Journal
By JOHN FUND
J. Christian Adams,, a former career Justice Department lawyer who resigned recently to protest political interference in cases he worked on, made some news yesterday in testimony before the U.S. Commission on Civil Rights.
As expected, he claimed that Associate Attorney General Thomas Perrelli, an Obama appointee, overruled a unanimous recommendation by six career Justice attorneys for continued prosecution of members of the New Black Panther Party on charges of voter intimidation in an incident I detailed here yesterday. But Mr. Adams leveled an even more explosive charge beyond the Panther case. He testified that last year Deputy Assistant Attorney General Julie Fernandes made a jaw-dropping announcement to attorneys in Justice's Voting Rights section. She said she would not support any enforcement of a key section of the federal "Motor Voter" law -- Section 8, which requires states to periodically purge their voter rolls of dead people, felons, illegal voters and those who have moved out of state.
According to Mr. Adams, Justice lawyers were told by Ms. Fernandes: "We're not interested in those kind of cases. What do they have to do with helping increase minority access and turnout? We want to increase access to the ballot, not limit it."
If true, Ms. Fernandes was endorsing a policy of ignoring federal law and encouraging potential voter fraud. Ms. Fernandes was unavailable for comment yesterday, but the Justice Department has issued a statement accusing Mr. Adams of "distorting facts" in general and having a political agenda.
But there is some evidence backing up Mr. Adams. Last year, Justice abandoned a case it had pursued for three years against Missouri for failing to clean up its rolls. When filed in 2005, one-third of Missouri counties had more registered voters than voting-age residents. What's more, Missouri Secretary of State Robin Carnahan, a Democrat who this year is her party's candidate for a vacant U.S. Senate seat, contended that her office had no obligation to ensure individual counties were complying with the federal law mandating a cleanup of their voter rolls.
The case made slow but steady progress through the courts for more than three years, amid little or no evidence of progress in cleaning up Missouri's voter rolls. Despite this, Obama Justice saw fit to dismiss the case in March 2009. Curiously, only a month earlier, Ms. Carnahan had announced her Senate candidacy. Missouri has a long and documented history of voter fraud in Democratic-leaning cities such as St. Louis and Kansas City. Ms. Carnahan may now stand to benefit from voter fraud facilitated by the improperly kept voter rolls that she herself allowed to continue.
Mr. Adams' allegations would seem to call for the senior management of Justice to be compelled to testify under oath to U.S. Commission on Civil Rights. But Justice is making none of its officials available and is refusing to enforce subpoenas issued by the commission. The more this story develops, the more it appears Justice is engaged in a massive coverup of its politicization of voting rights cases.
To read more stories like this one, please subscribe to Political Diary.
July 8th, 2010
Wednesday, January 6, 2010
From The Conservative Refocus News Archives
|Chevron is leasing the Clear Leader, which floats in 4,300 feet of water in the Gulf of Mexico, to drill for oil through nearly five miles of rock.|
Big Oil never wanted to be here, in 4,300 feet of water far out in the Gulf of Mexico, drilling through nearly five miles of rock.
It is an expensive way to look for oil. Chevron Corp. is paying nearly $500,000 a day to the owner of the Clear Leader, one of the world's newest and most powerful drilling rigs. The new well off the coast of Louisiana will connect to a huge platform floating nearby, which cost Chevron $650 million to build. The first phase of this oil-exploration project took more than 10 years and cost $2.7 billion -- with no guarantee it would pay off.
|More from WSJ.com:
• Drill, Baby, Drill: Does Virginia's Gov-Elect's Call for Offshore Drilling Add Up?
• Apple to Ship Tablet Device in March
• World's Tallest Skyscraper Opens in Dubai
Chevron came here, an hour-long helicopter ride south of New Orleans, because so many of the places it would rather be -- big, easily tapped oil fields close to shore -- have become off-limits. Western oil companies have been kicked out of much of the Middle East in recent decades, had assets seized in Venezuela and seen much of the U.S. roped off because of environmental regulations. Their access in Iran is limited by sanctions, in Russia by curbs on foreign investment, in Iraq by violence.
So, Chevron and other major oil companies are moving ever farther from shore in search of oil. That quest is paying off as these companies discover unexpectedly large quantities of oil -- oil that only they have the technology and financial muscle to find and produce.
In May, the first wells from Chevron's latest Gulf of Mexico project came online. The wells are now pumping 125,000 barrels of oil a day, making the project one of the gulf's biggest producers. In September, BP PLC announced what could be the biggest discovery in the gulf in years: a field that could hold three billion barrels.
Beyond the Gulf of Mexico, companies have announced big finds off the coasts of Brazil and Ghana, leading some experts to suggest the existence of a massive oil reservoir stretching across the Atlantic from Africa to South America. Production from deepwater projects -- those in water at least 1,000 feet deep -- grew by 67%, or by about 2.3 million barrels a day, between 2005 and 2008, according to PFC Energy, a Washington consulting firm.
The discoveries come as many of the giant oil fields of the past century are beginning to dry up, and as some experts are warning that global oil production could soon reach a peak and begin to decline. The new deepwater fields represent a huge and largely untapped source of oil, which could help ease fears that the world won't be able to meet demand for energy, which is expected to grow rapidly in coming years.
For oil companies, the discoveries mean something more: After a decade of retreat, large Western energy companies are taking back the lead in the quest to find oil. "A lot of people can get the very easy oil," says George Kirkland, Chevron's vice chairman. "There's just not a lot of it left."
There are challengers to Big Oil's deepwater dominance. Brazil recently has moved to give a larger share of its offshore oil to its state-run oil company, Petrobras. A handful of smaller companies, such as Anadarko Petroleum Corp. and Tullow Oil PLC, have had success offshore, particularly in Ghana, where giants like BP and Exxon Mobil Corp. are now playing catch-up.
The enormous investments of time and money required for such projects have made many experts skeptical that they can ease the long-term pressure on global oil supplies. The scale of the projects means that few smaller companies have the resources to take them on. Devon Energy Corp., an independent producer based in Oklahoma City, recently announced plans to abandon its deepwater-exploration business to focus on less-expensive onshore projects, which is says will produce a better return.
"This is technology capable of going to the moon," says Robin West, chairman of consulting firm PFC Energy, involving "extraordinary uncertainty, immense levels of information processing, staggering amounts of capital."
Offshore drilling is almost as old as the oil industry itself. In the 1890s, companies began prospecting for oil from piers extending off the beach near Santa Barbara, Calif. Gulf Oil drilled the world's first fully offshore well from cedar pilings on a shallow lake near Oil City, La., in 1911.
From there, the industry pushed gradually outward, from the Louisiana bayous in the 1920s into the Gulf of Mexico, where Kerr McGee drilled the first well out of sight of land in 1947.
The push into deeper water has come in the past decade.
"What has enabled us to do that is technology," says David Rainey, BP's head of exploration for the Gulf of Mexico. "We have been pushing the limits of seismic-imaging technology and drilling technology."
Perhaps a bigger reason for the recent emphasis on deepwater exploration is that companies had few other places to go. In the early decades of oil exploration, Western companies were the only ones with the technology to manage big oil projects. But as technology spread and state-run oil companies became more sophisticated, foreign governments have relied less on outside help and have demanded greater control of their own oil resources.
With a few exceptions, state-run companies have largely stayed out of the deep water, with its enormous technical challenges and multibillion-dollar investment requirements. Western companies have steadily pushed farther offshore, not just in the Gulf of Mexico but in places like Nigeria, Malaysia, Norway and Australia.
At the same time, traditional oil fields have begun to dry up. In Mexico, the world's seventh-largest oil producer, daily production has dropped 23% since 2004 as output from its giant Cantarell field fell sharply. Other countries have seen their own, mostly smaller, declines.
Falling output from old fields has stoked fears that world-wide production could be nearing its peak. Global oil reserves -- a measure of oil that has been found but not yet produced -- fell in 2008 for the first time in a decade, according to BP's annual statistical review. Moreover, there are signs demand could soon catch up to supply. Global oil consumption has risen by 5.4 million barrels a day in the past five years, while production has risen by just 4.8 million barrels a day.
Such fears helped drive a rapid run-up in oil prices to nearly $150 a barrel in July 2008. The global recession cooled demand, driving down prices, although many experts expect prices to rise again when the economy recovers. Already, prices have rebounded to about $80 a barrel, from under $35 in December 2008.
Rising prices have spurred offshore exploration. By 2008, about 8% of global oil production came from deepwater fields.
Yet even the biggest deepwater projects aren't enough to put a dent in global supply problems on their own. The world's largest deepwater platform, BP's Thunder Horse in the Gulf of Mexico, produces 250,000 barrels of oil a day, just 0.3% of global consumption.
"These discoveries are changing the debate," says Ed Morse, chief economist for LCM Commodities, a brokerage firm. What remains unclear, he says, is whether the deepwater projects will ensure that new discoveries continue to meet demand.
Many in the industry argue the new fields have expanded the limits of where the industry can find oil, potentially delaying a decline in global production.
"There are vast unexplored areas in deep water, so tremendous opportunities for growth," says Steven Newman, president of Transocean Ltd., which owns the Clear Leader rig.
The push into deeper water hasn't always been smooth sailing. Offshore projects are expensive, time-consuming and prone to failure. Chevron boasts of a 45% exploration overall success rate in recent years, a remarkable run by industry standards, but one that also means the company has spent billions on projects that haven't panned out.
Chevron's successes have outweighed its failures. It was expected to be the fastest-growing big oil company in 2009, as measured by oil production, in large part because of new offshore projects in the Gulf of Mexico and off Brazil. Other companies that have embraced offshore exploration, such as BP, are also seeing big growth, while those that haven't are scrambling.
Exxon, which hasn't emphasized deepwater exploration as much as competitors, recently offered $4 billion for a stake in an oil field off the coast of Ghana.
Chevron made its big offshore bet in the 1990s, when it began buying up leases in the Gulf of Mexico that were in such deep water, the technology didn't yet exist to drill there. Confident that technology would catch up, the company in 1996 bid in and won a U.S. government auction for the right to explore for oil in several areas of the gulf, in hopes that a fraction would turn into producing fields.
Chevron then spent six years analyzing its new holdings, figuring out which were most likely to hold oil. The key tool in its arsenal: seismic imaging, a sonar-like process in which sound waves are shot into the rock, and their echoes are picked up by sensors on the surface.
Adding to the challenge: The oil that Chevron was pursuing lay beneath a thick layer of salt, which disrupts seismic sound waves and blurs the images like a smudge on a camera lens. The company had to analyze the data with supercomputers to clear up that distortion.
The analysis revealed a potentially huge oil reservoir. Even so, Chevron estimated it had only a one-in-eight chance of finding commercial quantities of oil. The only way to know for sure was to drill.
So, in 2002, Chevron spent about $100 million to sink its first well in the field, which came to be known as Tahiti. That well needed to hit a 200-foot-long target from five miles away -- akin to hitting a dart board from a city block away.
"You have to roll the dice, and the dice roll now is north of $100 million," says Gary Luquette, president of Chevron's North American exploration and production division.
Chevron's first Tahiti well struck enough oil to make it worth more drilling to see how big the field might be. By 2005, the company had learned enough to go forward with the project. That required building a 700-foot-tall, 45,000-ton floating oil-production platform, and drilling a half dozen wells to feed oil to it. Tahiti produced its first commercial quantities of oil in May.
On a recent morning, the Clear Leader rolled on the waves 190 miles south of New Orleans, held almost perfectly in place by its satellite-controlled navigation system and six Korean-made engines.
In a cabin on the ship's deck, a team of drillers in coveralls monitored computer terminals as they used joysticks to control a drill bit more than 12,800 feet below. The oil they were targeting lay another 14,000 feet underground -- an easy reach for a ship that can drill down 7.5 miles.
The well is part of a second phase of the Tahiti project, which will require drilling several more wells and expanding the floating platform -- an additional $2 billion in spending, still with no guarantee of success.
Kevin Ricketts, a Chevron engineer who worked on both phases of the Tahiti project, recalled looking up at the massive platform while it was still on shore, and reflecting on how his team's analysis had led to its construction.
"I'd never seen anything that big," Mr. Ricketts said. "I thought, holy moly, our production forecast led to that thing being built. I sure hope we're right."
July 8th, 2010
By Barry Secrest
A Conservative Effort At Aiding The White House
For instance, when the President is obviously playing basketball, which is sometimes difficult to hide, we find the term "Flexible Global Manipulation" might prove more suitable while sounding "really" officious. In addition, rather than rudely referring to the President's having to use the restroom, we would recommend a Latin derivative to throw at us "common folk" to make the activity look terribly important; therefore, we believe "Potus Vacuus Excursion" sounds truly awe inspiring and will also make the President look extremely industrious especially after having drank a lot of fluids.
Should the President elect to have additional offspring, rather than shamelessly bringing the President's personal life into the mix, we recommend that the White House use the mystical term "Nephalim Creation" in keeping with the President's oft spoke of mystical qualities. Also, and in that particular vein, Humankind has always searched for the appropriate ways to say "when the moment's right" without saying it, but rather than boorishly announcing it to everyone we would recommend the term "Procreative Glandular Evacuation," which could even pique the interest of the International Red Cross while dispelling and recycling the former criticisms into praise.
Last but not least, borrowing from Vice-President Biden's somehow intimate knowledge that the President is "very clean" not to mention "articulate" obviously requires a regimen of superlative hygiene, but should not be spoken of directly in good taste. Here, instead of using the age-old "taking a bath" explanation, we would recommend the term "Sequential Self-Baptizing Episode," which would also be effective at inspiring the Media's continued awe of the "Commandeer In Chief."