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Delaware chatter 2013 (microblogs)

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12/31/13, A1/A5, State decisions leave 5 million with no coverage, Marc Levy (AP)Picture: Pittsburgh resident Shelagh Collins gets by on secretarial temp work and unemployment compensation checks, but she can’t afford specialized health[care] treatment. [As related later in the story, Collins is not currently eligible for Medicaid because she is hanging on to a $21K Section 401(k) retirement account.]  The gist of this story is to blame states for not extending Medicaid coverage as was contemplated by GovCare, a situation made possible “by the domino effects of last year’s Supreme Court ruling that states could not be forced to extend Medicaid coverage.”  Some 4.8 million Americans are said to be affected, more than 1/5 of whom live in Texas and some 281K in Pennsylvania.  Take Cheryl Jones, a 61-year-old part-time homecare worker from Erie, PA, “who makes do without health[care] insurance by splitting in half pills for high blood pressure, which she gets from a friend, not a pharmacist.  “She’d also like to visit a dentist to fix her broken partial dentures” and “a new pair of glasses might be nice.”  Note: most of the holdout states are “conservative states in the South, Midwest and northern Rocky Mountains that voted against Obama [in 2012].”  And PA governor Tom Corbett “doesn’t apologize for not expanding eligibility right away.”  Medicaid is a deeply flawed program, which suffers from joint federal/state management.  SAFE believes it should be block granted and turned over to the states, not expanded to cover even more people – primarily at federal expense (at least initially).

12/31/13, A5, Congress letting 55 tax breaks lapse, A5, Seth Ohlemacher (AP) – How could Congress allow “a package of 55 popular tax breaks” to expire at the end of 2013, “even though they save businesses and individuals billions of dollars.”  And of course Congress does the same thing “almost every year,” and will likely renew the breaks retroactively so “taxpayers can claim them by the time they file their tax returns” for 2014 (in 2015).  One reason for this pattern is that short-term extensions minimize the “revenue loss” that needs to be explained and/or made up for in the congressional budget process.  Another point, not mentioned in this story, is that beneficiaries of the various tax breaks, e.g., companies that claim R&D or wind power tax credits, are reminded periodically that they should be appreciative of the members of Congress who are voting for these benefits.  By the way, most of these tax benefits are unjustified and should be scrapped while reducing tax rates – it’s called tax reform.

12/31/13, A9, From the DC Republicans: The cruelest cut of all, Eugene Robinson – “To 1.3 million jobless Americans, the Republican Party wishes you a Very Unhappy New Year.”  According to the writer, there is no “logical reason to cut off unemployment benefits for those who have been out of work the longest,” thereby dealing “a cruel blow to families that are already suffering.”  An extension of the “emergency” extended benefits should have been included in the budget deal, at an annual cost of $25B, but it wasn’t.  Democrats tried to offer an extension for 3 months (with identified savings elsewhere in the budget to pay for it) but House Speaker John Boehner “refused to allow a vote on the proposal.”  The Republican “far right” considered the budget deal a defeat because it did not “slash Medicare and Social Security” so “accepting an unemployment extension” that was favored by Democrats “would have been too much to swallow.” And people who think extended benefits “coddle the unemployed,” e.g., Mitt Romney and his fundraiser crack about the 47 percenters, should consider that “some jobless men and women . . . don’t have well-to-do parents or even a trust fund to fall back on.”  Also, “unemployment benefits don’t even cover basic expenses, much less bonbons.”  Robinson closes by predicting that the GOP will cave in the ensuing debate, as its leaders don’t “want this to be a campaign issue for Democrats.”  There is plenty of evidence that unemployed Americans are milking the welfare system, of which long-term unemployment benefits is only one of many components, and Robinson’s diatribe hardly proves otherwise.  Why get off welfare? Michael Tanner, 8/26/13.

12/29/13, A1/A8-9, Questions remain for data center, Environmental zoning hurdles may slow STAR campus project, Melissa Nann Burke & Jeff Montgomery – More negative coverage of the proposed data center/power plant on the UD Star Campus at site of former Chrysler plant.  “After the Data Centers LLC first met with Delaware officials two years ago,” this article begins, “a regulator [unnamed] told the newcomers to involve the community as early as possible ‘to reduce the chance of significant delays.’  [However,] they didn’t take the advice.”  Now “a group of neighbors” has “sworn to fight TDC’s Wolf Technology Center” to the bitter end due to “environmental and quality-of-life concerns about locating the facility’s gas-fired power plant with a capacity of 279 megawatts in a residential area.” Looks like the zoning, environmental permitting, etc. process will stretch out longer than had been anticipated, and there is a lot of back and forth about forcing TDC  to prove that the extra power from the power plant will not exceed the data center’s power needs by more than 30% (not just in the long run, but month by month).  And Gene Kern, the TDC president, is reportedly getting frustrated.  “Everybody wants us to prove everything we say in advance – far in advance of it ever happening.  We have to prove what we’re doing for the city of Newark, and for the state of Delaware to bring a billion-dollar job to the state.  We have to jump through every kind of hoop imaginable and possible.”  What it boils down, Kern suggests, is that the area can say “yes” to the project or they can say “no,” but they can’t have it both ways.  “I don’t know which way the city of Newark is going to go long term.”   If TDC had gone public earlier, this would have just given the opposition more time to organize.  This is not reasoned opposition, this is ideological opposition that cannot be satisfied short of gutting the project.  If there was more than 30% excess power in a given period, what difference would it make?  From the article, the Newark power consortium (DEMEC) is not saying that it couldn’t either use the power or sell it to the grid.

12/29/13, A21, Budget deal shows compromise isn’t a dirty word, Ted Kaufman – The writer attributes the acceptance of the December budget deal to the public reaction (per poll results) to the “government shutdown” in October, which served as “a significant wakeup call” for Republicans.  So “those formerly silent Republican House members said enough is enough” and voted for “the budget deal hammered out by Republican Rep. Paul Ryan and Democratic Sen. Patty Murray.”  True, the deal was “pretty small potatoes,” but it did “signal that compromise is no longer a dirty word in Washington.”  So maybe, “we will begin to see the return of the kind of bipartisan legislative give-and-take that is until recent years was how Congress operated.”  A raft of comments follows by prominent GOP leaders (Ryan, House Speaker John Boehner, Ryan, Darrell Issa, and Mike Huckabee) in favor of the deal.  Don’t expect any “immediate breakthroughs” on big issues, but “Speaker Boehner now seems to have enough House Republicans at his back to make real negotiations with Senate Majority Harry Reid and President Obama a possibility.”  Kaufman’s idea of Republican “negotiation” is basically capitulation.  He neglects to mention what compromises the Democrats made in the budget deal, and unsurprisingly as there weren’t any to speak of. Not a single wasteful government program got canceled, several government user fees were hiked, and the principal “spending cut” was an extension of sequestration (which Kaufman has lambasted in previous columns) for two additional years (fiscal years 2022 & 2023).

12/26/13, A16, A call for an American manufacturing future – This editorial expresses appreciation for the efforts of Senator Chris Coons and other Democratic senators in proposing a series of steps to create more “Manufacturing Jobs for America.”  Here’s a link to a statement of the particulars.  Delaware’s junior senator describes MJA as “a campaign to build support for good manufacturing legislation that Democrats and Republicans can agree on.”  We should view “manufacturing jobs” as more than simple “blue collar jobs,” the editorial suggests, because manufactured goods are exported to other jurisdictions and therefore bring in money from the outside rather than simply shifting money between Delawareans.  So instead of just creating a pot of money for infrastructure in Delaware, maybe we should be upgrading the Port of Wilmington facilities based on some sort of calculation of the rate of return to the state.  Or looking at what sort of expenditures in Sussex County would make Delaware chicken farmers “more competitive in the global market.”  With that in mind, according to the editors, the MJA proposals “are worth a look,” even though “nobody should expect Washington to make good decisions about which business should do what.”  The MJA proposals call for more government spending, regulation, and subsidies (no wonder so many companies are listed as supporters).  We do not have much faith in such approaches, which sound like a step in the wrong direction, and even the NJ endorsement seems rather tepid.

12/25/13, A1/A6, Health[care] woes just part of history; Popular federal programs were target for early criticism too, Tom Raum (AP) – “Although multiple problems have snarled the rollout of President Barack Obama’s signature healthcare law,” this story begins, “it’s hardly the first time a new, sprawling government program has been beset by early technical glitches, political hostility and gloom-and-doom denouncements.” Previous examples cited: Social Security (1935-37), Medicare & Medicaid (1965), Supplemental Security Income (1974), Medicare prescription drug benefit (2006).  But take heart, as “these programs today are enormously popular with recipients.”  Let’s hope history will repeat itself.  According to Mark McClellan, who oversaw the prescription drug rollout during the Bush administration, “the most important thing” for the Obama administration “is to make this as practical and easy for people, put in direct terms that matter to them.”  And scholar and historian Stephen Hess, who has reportedly worked for four presidents, adds that the president should realize that “this too shall pass” and stay the course, correcting things as he can.  Social Security, Medicare & Medicaid were already driving the government towards insolvency, and GovCare will make the fiscal problem that much worse.  So the foregoing comments miss the real point, which is that the politicians have been making promises the government will not be able to keep – and we are all going to pay for it.

12/23/13, A1/A2, Climate change views difficult to sway; Delaware’s variable weather can play into preconceived notions, Molly Murray - Large photo across top of newspaper: “Rian Croft (left), 11, and her sister Hunter, 8, [small figures in a panoramic picture] enjoy Sunday’s warm temperatures as they walk around the Newark Reservoir.  Some might see this as a “balanced” article given its acknowledgment that the current unseasonably warm weather was preceded by “13 days of cold temperatures and snow (at least in the northern part of the state).”  Also, according to Anthony Leiserowitz and Peter Howe, researchers for a new study by the Yale Project on Climate Change, people are often “influenced by prior beliefs about global warming” in “interpreting the significance of weather events.”  For “alarmists,” any extreme weather event can be a call to action – “even those with no known scientific connection to climate change.”  For “deniers,” the reaction is “that any action on climate change will signal a huge expansion of government, higher taxes and because it is a global issue, more US interaction with the United Nations.”  But fret not, alarmists, as the facts are on your side.  Changes in local weather and climate conditions, says Leiserowitz, continue to be consistent with scientific projections of global warming.  Also, the L&H study finds that a great many people across the country have been impacted by one or more extreme weather events, with the result that 65% of Americans “are beginning to connect the dots” and say “climate change is affecting them.” Once again, the News Journal fails to note that the global warming theory is coming unglued (for the past 15+ years, the warming trend has stopped).  Not for nothing did the alarmists shift their focus from “global warming” (specific and verifiable) to “climate change” (can be claimed no matter what happens).  And our belief that warnings about climate change are meant to support a big government agenda is not a scientific theory, it is political reality. 


12/23/13, A1/A5, Last-minute push to get word out on Obamacare; Deadline to sign up for coverage beginning Jan. 1 is tonight, Beth Miller – Santa’s elves are not the only beings working over the holidays; “scores of health[care] insurance marketplace guides” are “doing the Obamacare Hustle, with anyone who will listen.” [Really, that’s what the article says, we did not make the words up.]   Thus Kitty Middleton, a 43-year-old hair stylist who “was killing some time in the Dover Public Library” saw a table in the main lobby offering information on the new healthcare insurance (HCI) marketplace and “went straight over to check it out.”  After talking with Margie Norris of Westside Family Healthcare, Middleton thought there was likely a fit.  She suffers from diabetes and high blood pressure, and therefore “can’t afford to go without medical care for too long,” but makes too much to qualify for Medicaid.  Accordingly, a HCI plan from the exchange “probably will be perfect,” especially “if she gets a subsidized plan.”  Suggestion (per Middleton): guides should also consider working in malls, etc., because most retail employees don’t have HCI.  Various other stories about the GovCare signup process are related, mostly of a positive nature. One woman paying $ 700+ a month for COBRA insurance after losing her job found she would only have to pay “about $300 or so” for a GovCare policy.  An attorney’s wife would have cost $675 a month to add to her husband’s policy, but a GovCare plan for her would only cost $200 per month. A prospective small business owner hoped to be able to offer HCI coverage for employees utilizing a “subsidized small-business plan.” What about deductibles and doctors in the network; simply comparing plan premiums can be quite misleading. GovCare premiums may rise if enough young, healthy people don’t sign up.  And finally, we the taxpayers will be on the hook for those coveted subsidies.

12/20/13, A17, Republicans blocking real American progress, John Engelman (Wilmington) – Re “Job loss and income inequality are global problems,” James Butkiewicz (UD economist), 12/16 /13.  The writer agrees with Butkiewicz that benefits of technological change these days are increasingly going to capital versus labor, and therefore contributing to growing income inequality.  He takes issue, however, with the suggestion that this trend can be counteracted through better education.  The US is already spending gobs of money on education, and the recent failure of “No Child Left Behind” should discourage optimism about the success of other educational initiatives.  “Arthur Jensen, Charles Murray and other have argued, and in my opinion plausibly, that most Americans are learning as much as they are able to learn, and that most spend too many years in school.”  Also, the problem can’t be “solved with the Republican nostrums of ‘lower taxes, less government.”  So let’s keep reducing the work week, hiking the minimum wage, and strengthening labor unions – all things that “the Republican Party, the Tea Party, and libertarians stand firmly in the way of” doing.  Can’t say we agree with these conclusions, which rest on the premise that the free market cannot be trusted to resolve economic problems, but we too are skeptical that a third way (e.g., government-supported training programs) can bridge the divide between socialism and capitalism.

12/17/13, A10, Cross-state [border] power plant pollution in Del. is a myth, David Stevenson (Caesar Rodney Institute) – “For the first time,” the writer states, “Delaware will meet all air-quality standards this year.”  And more specifically, re the two air pollutants that are being actively monitored, “2013 saw only 16 hours, or 0.2 percent of the time, on two days, just barely above the standard for ozone.  The average maximum level of fine particles is about 20 percent better than the standard and is closing in on estimated pre-industrial levels.” What’s more, “the primary remaining emission source for nitrous oxide, a precursor for ozone, is on-road and off-road vehicle engines [not power plants at all].”  So the appeal to the EPA (obviously timed “to influence a Supreme Court review” of an EPA regulation re cross-border pollution standards that was struck down as unconstitutional) wasn’t warranted.  Conclusion: Delaware should “celebrate the progress we have made in reducing air pollution and [move] on to other problems instead of worrying about what other states are doing.”  If Stevenson’s assertions are correct, and they certainly sound fact-based, it’s hard to understand the position of Delaware and other downwind states that emissions being blown in from the mid-west represent a huge health problem. Are they claiming the current standards are not stringent enough and comparing the status quo to the standards they believe should be set?  Governors seek EPA help with air quality; Calling on other states to reduce pollution that travels to region, 12/10/13

12/16/13, A10, Job loss and income inequality are global problems, James Butkiewicz (UD economist)
– The writer begins by referencing “a series of excellent articles and editorials investigating the issues of job loss and growing income inequality in the state and the nation.” Then he cites research that suggests: (1) similar trends in other countries, and (2) a fundamental shift – from a basically constant 70% (over decades) of the growth in national income and production showing up as higher pay and benefits for workers to a lower percentage, e.g., “just below 65 percent” (from 1970 through 2009).  The reason for the shift is believed to be that technical change used to be “labor-augmenting” (so technology advances would make workers more productive), but has increasingly become “capital-augmenting” (suggesting more of the gain will go to the “owners of capital”).  Hello, rising “income inequality” (shudder).  There is a lot of substitution of capital (machines) for human labor, eliminating jobs for low-educated workers and reducing their relative compensation.  Two examples: (1) PA and MD have both “expressed a commitment to move to all electronic toll collection on toll roads based on the “expectation” that most vehicles would have EZPass and the others could be billed based on photographing their license plates. Without fines, we doubt it!  (2) Fast food restaurants could replace the people they employ to take orders and collect payments.  “Anyone who has ordered from a Wawa deli knows it is possible to order a cheeseburger with extra ketchup, light mustard, no onions and two pickle slices using electronic technology.  And we have become accustomed to making payments in grocery and big-box stores without cashiers.” Speak for yourself!  Given such trends, the handwriting is on the wall that “improved education, as has been advocated extensively on these pages, is critical” to improve opportunities.  Need-based vouchers for post-secondary education *** increased emphasis on technical training provided by community colleges (“four-year degrees are not appropriate for everyone”) *** one second-chance scholarship for individuals in their late teens, 20s, or “possibly older” to “obtain any necessary remediation and technical training from community colleges”  *** increased emphasis on education, especially math, sciences, computer literacy and other technical skills, as well as reading comprehension, “beginning in the earliest elementary grades”.  Although “income redistribution” (aka welfare) can “alleviate the worst poverty,” employment is needed to provide “opportunity for advancement” and “much greater individual dignity.”  Educators should focus, starting at the earliest ages, on “[motivating] their least-motivated students, as they are at the greatest risk of being left behind in life.”  Much of the foregoing sounds plausible, but we do not agree with elevating equality of outcomes over opportunities – which would be the likely result of the policies that are advocated.  Also, some cost-saving technology is not appealing to human customers, and they will not necessarily accept the inferior service that would result.


12/13/13, A1/A2, Revolutionizing the workforce; Panelists stress need for better training, Jeff Montgomery & Jonathan Starkey – About 150 people attended a 90-minute forum on fostering more “good” jobs, the latest in the  Imagine Delaware series.  The 5 panelists: Gov. Jack Markell, Mark Kleinschmidt (NCC Chamber of Commerce), Dr. Domenico Grasso (UD provost), Robert Schwartz (Harvard Graduate School of Education), and Robert Atkinson (Information Technology and Innovation Foundation). Not surprisingly, given this lineup, most of the emphasis was on training programs.  Schwartz reportedly said this country “has lagged in assuring that young people are prepared for vocations or technical work as they leave high school.”  Grasso said the US could gain an edge on other countries by integrating science and math training with the humanities and social sciences to promote new ideas.  Governor Markell related his visits to employers around the state, saying that “workforce training” was “by far the number one thing I hear from employers.”  Also, “more and more there has to be a focus on what I call ‘Just in time training,’ where training is more over a period of weeks, as opposed to a period of years.” Personal responsibility to prepare for jobs in the workplace was not much mentioned, apparently, and although an attendee (Bill Pearson) is shown on the front page directing a pointed question at panelists – Why aren’t students “being taught capitalism” and the skills to become entrepreneurs? – there is no indication of how the question was answered.  However, see the next story (an insightful column written by a free market advocate)

12/13/13, A21, Lessons learned from the Fisker investment, Fred Cullis (president of Cullis Associates, Inc., a manufacturer’s representative agency) – After noting previous commentary about “lessons learned” from the failed Fisker investment, Cullis suggests a colorful analogy for the First State’s approach to job creation.  A farmer who “maintains his fields as an arid desert” tries to make up for it by “[trucking] in a large, exotic tree that has never yielded fruit, [scraping] out a depression in the sand, [and plunking] the tree in place.”  To his shock and amazement, the tree fails to produce.  Accordingly, “we need an administration that will transform Delaware’s manufacturing desert into fertile ground.”  To do this, consider three steps: (1) Bin the gross receipts tax, which is a red flag for prospective investors that “our state is not business savvy or friendly.”  Only 11 states have a gross receipts tax, according to Cullis, and 8 of them (DE included) are in the bottom 25 states for business.  So let’s replace this levy with “government cost savings and a more intelligent instrument for generating state revenues.”  Unless and until a better tax alternative is identified, we are neutral on this idea.  (2) Do something about above average electric power costs, namely “exit the RGGI and build lower-cost gas-fired generation in the state.” Amen!  (3) Reform Delaware public education – an objective that everyone professes to support – by common sense reforms versus “Common Core” and “Race to the Top,” which are characterized as “expensive and intrusive programs that simply will not improve our children’s education.”  For example, give more authority to school principals “to hire, fire, promote, motivate and reward teachers as they see fit” and then use a school choice voucher system that would “allow market forces to sort out the winning schools from those that do not succeed.” Sounds like the kind of approach that Jim Hosley of Caesar Rodney Institute and Jack Wells have been advocating.  We like it!

12/13/13, A18, DuPont defends biofuels against EPA proposal, Aaron Nathans
Under legislation enacted six years ago (Fiscal visionaries at bay, 12/24/07) there has been an aggressive ramp-up in the amount of ethanol required to be blended into motor fuel sold in this country, which now threatens to force refiners to pay penalties for noncompliance because there isn’t enough gasoline being sold to absorb the mandated ethanol without upping the blending percentage to the point where car engines would be damaged, etc.  The EPA has finally reacted by relaxing the scheduled ramp-up, at least temporarily, which represents a rare bit of common sense on the part of the agency and should please the vast majority of Americans.  But this doesn’t please the suppliers of ethanol and other biofuels, including the DuPont Company, and they are doing their best to oppose the proposal.  Thus, as here reported, a senior vice president of DuPont – James Collins – “was scheduled to testify” before the Senate Committee on Environment & Public Works to the effect that “reversing course on this policy would have devastating effects.  *** inject uncertainty into an improving economy with job and tax revenue loss *** [And] long term, we risk much more.  We would find ourselves shipping these technologies, jobs, and environmental benefits overseas to countries with more stable policy environments.”  DuPont has invested in biofuels R&D and is scheduled to open a big cellulosic ethanol plant in Iowa next year, so one can appreciate their interest in the matter.  Just goes to show how “green” energy policies create vested interests that support them, which argues for keeping the government out of picking economic winners and losers in the first place.

12/12/13, A13, Our future depends on future of jobs – Editorial notes details of tonight’s Imagine Delaware forum (6:00 PM, Clayton Hall, UD), which curiously has not been advertised with the customary fanfare in the NJ. However, here is a notice that is posted on the Internet. Panelists are not from the private sector, with the exception of Mark Kleinschmidt, president of the NCC Chamber of Commerce, so don’t expect a lot of private sector ideas.    As an illustration of the confusion about how to create jobs, note the front-page story today. Wage hike on fast track; minimum would increase to $8.25 an hour, A1/A2, Jonathan Starkey – It seems that Rep. Bryon Short (D-Highland Woods), who tied the proposal (already passed in the Senate) up in committee a few months ago, now says the “time is right” to raise Delaware’s minimum wage because Delaware’s unemployment rate is down to a mere 6.8%.  What about unemployment for high school graduates, who normally take the minimum wage jobs?  And where’s the evidence that the minimum wage actually has a beneficial economic effect, since all it does is eliminate jobs at the margin and push up prices.

12/11/13, B1/B2, Coping with rising seas; Delaware sends task force its best ideas, Jeff Montgomery – Gov. Jack Markell (small photo) said his administration has submitted “a list of preliminary recommendations” following his selection for the Task Force on Climate Preparedness and Resilience – a group that includes 8 governors and 18 local government or tribal leaders from around the country.  According to Markell, “I think there are quite a few areas where federal policy can be improved as it relates to helping the country, and in our case Delaware, prepare for climate change.”  The task force has a year to prepare consensus recommendations.  The story throws out several paragraphs about the perceived threat, beginning that “national and international reports have warned with growing certainty that human-caused emissions of carbon dioxide and other greenhouse gases – largely from fossil-fuel burning – are increasing atmospheric temperatures at an accelerating rate.”  No mention that the global warming trend stopped about 15 years ago, at least for the time being.  Finally the “best ideas” are reeled off, including “modernization of Corps [of Engineers] channel dredging policies to support regional, coastal and habitat protection projects; giving a priority to cleanups of contaminated sites in flood-prone areas; assuring that federally subsidized transportation projects include changing flood assumptions in design decisions; and including sea level rise in National Flood Insurance Program models and maps.” How much sea level rise?

12/10/13, A1/A2, Governors seek EPA help with air quality; Calling on other states to reduce pollution that travels to region, Nicole Gaudiano – Being one of the “downwind” states, Delaware has long complained about air pollution coming in across its borders from states to the west (many of them with GOP governors). One might think the relief sought should be greater latitude in air quality standards for Delaware (which can’t be met by reducing pollution generated locally), but no – it’s to crack down on the upwind states and undermine their economies. Presumably that was the point of an earlier story by Aaron Nathans: Regional group wants EPA to use it as a model, 12/3/13, but in any case this restated story makes the point explicitly.  “Eight Northeastern and Mid-Atlantic states, including Delaware, are petitioning the [EPA] to require Southern and Midwestern states to reduce air pollution that causes public health problems downwind.”  Delaware Gov. Jack Markell (small picture) is quoted to the effect that “his region is on the receiving end of hundreds of thousands of tons of pollution from upwind states, affecting residents’ health, quality of life and ability to expand economically.”  Solution: “the petitioners want the nine upwind states to join them in the ‘Ozone Transport Region,’ which would require them under the Clean Air Act to reduce pollution by using emission control technology or by relying on cleaner fuels to generate power.”  Of course, what the petitioners really want is for the EPA to impose a solution, which it already attempted to do via a Cross-State Air Pollution Rule – the DC Court of Appeal decision slapping down this proposed rule has been appealed and the Supreme Court justices will hear oral arguments today.  DNREC Secretary Colin O’Mara explains that the Ozone Transport Region would be even “better because it controls more sources and it allows a wider range of types of controls than the limited universe under the [EPA] rule.”  Note well: “Ozone has been linked to premature death” and “can irritate the respiratory system, causing coughing, throat irritation and chest pains, aggravating asthma and other chronic lung diseases.” The air we breathe depends on fight, A9 –The case to be argued before the Supreme Court today “seems a simple one.”  After all, “science on the topic has grown more solid over the years and it is pretty safe to say that a lot of the air-borne particulates [and ozone?] causing Delawareans health problems are coming from the Mid-West.”  And “we know today that this form of pollution can easily be solved.  Delaware and other states in this part of the country did.  What can’t the other states, the ones sending the pollution our way?”  The air in Delaware “is problematic and dangerous,” and it is their fault.  Both the EPA rule and the relief now being sought should “go forward.” Two days ago the NJ editors lamented the scarcity of jobs in the new economy; now they pivot to support draconian air control regulations that would make things worse.  Maybe the solution is to move all that messy manufacturing activity to China and be done with it.

12/10/13, B1/B2, Climate change expert: public perception lags, Jeff Montgomery – According to Katharine Hayhoe (small picture), the “global science of human-caused climate” [assumes the desired conclusion] is getting better all the time, but the public’s understanding of the topic “is definitely a worry.”  In terms of scientific certainty we’re down to the decimal points, but “in public opinion, we could be advancing by tens of percent” through outreach and better communication [aka propaganda]. Hayhoe was speaking at an event hosted by the UD College of Earth, Ocean and the Environment.  Alarming conclusions are cited from a June report “guided heavily by Hayhoe’s research” that Delaware summers “will grow steadily hotter on average in coming decades.” See, e.g., “In long term, weather could be scorching,” 6/27/13.  An attendee at the seminar is quoted to the effect that the science is clear but changes to mitigate climate change by curbing “pollution” have foundered.  Accordingly, he asked, “how do we disrupt governing patterns to get off the path to dependence” on fossil fuels?  To the barricades! But what about fact that global warming trend stopped about 15 years ago?

12/8/13, News Journal continues to dwell on economic issues in Delaware – There is a headline story that continues to two full pages inside.  Where are the jobs?  With more Delawareans working low-wage jobs and mid-wage positions disappearing, the rise in a slice of high-wage jobs is widening the income gap, A1/A6-A7, Jeff Montgomery, Jonathan Starkey & Patrick Sweet.  Then an editorial on A34 reprises the subject. Will we be a state of just rich and poor? The theme is that blue collar and other “middle class” jobs are disappearing due to automation, offshore competition, and lingering effects from the “Great Recession” that brought a shutdown of auto assembly plants in DE, etc. Most of the new jobs being created are low-skill, low-pay service jobs and higher-end jobs that many young people lack the education and technical skills to fill.  An infograpic on the front page based on 2002 vs. 2012 DE employment data divides workers into three categories: (A) Low-wage jobs (under $13.43 an hour) comprising 38% of the workforce, no. of jobs up 2% over the period; (B) Mid-wage jobs (annual salary $27,945 to $64,200), 44% of workforce, no. of  jobs down 12%; (C) High-wage jobs (annual salary over $64,200), 18% of workforce, no. of  jobs up 6%.  “State income disparities” seem to be as much of a concern as the decline in economic prosperity – and although many of the sources quoted say “we need to do something,” none of them seem to have compelling “solutions” to offer.   And the editorial poses some “what if” questions in rather stark terms.  “Imagine a Delaware without a middle class. *** What kind of state would we have if a permanent underclass formed, one so rigid that it would almost be impossible to rise no matter how hard an individual worked or how talented he was? *** We might find an answer by looking around.  *** more and more people with only high school educations are struggling to hold on to the few middle skill jobs still available. A college education . . . grown so expensive that for many the only chance of getting one is to sell yourself into deep debt. *** many working people live with fears of losing employer-sponsored healthcare *** Manufacturing jobs have been slipping away.  *** Gone are the banging metal assembly lines that took little skill.  *** New technology is shipping what were once considered irreplaceable local skills, like reading x-rays, overseas for cheaper labor to do the task.  *** Sometimes it seems as if our political leaders don’t understand the challenge.  *** both parties like to fight what can be called ideological battles with slogans that rouse the base but provide little real information about solutions.  [But never fear, because] the News Journal is challenging some of these non-answers.  On Thursday night, at the University of Delaware’s Clayton Hall, [it] has gathered a group of experts to propose some solutions.” Somehow, we don’t expect a great deal of enlightenment to result from this forum.  But if there are any answers to be had, we sincerely doubt they will be driven by government action.  That’s not an ideological view either, it’s based on our understanding of the lessons of economic history.  Bootstrap economics do not work.  There is no such thing as a free lunch.  Big subsidies for new investments, more welfare spending, increases in the minimum wage, government intervention in college education, etc. will not bring back the era of unparalleled US prosperity that ensued after World War II when the industrial base of other countries had been largely destroyed. 

12/7/13, A4, Experts urge feds to measure our happiness, Seth Borenstein (AP) – A panel of economists, psychologists and other “experts” assembled by the National Academy of Sciences, a group that “advises the government,” reportedly “recommended that federal statistics and surveys, which normally deal with income, spending, health and housing, include a few extra questions on happiness.”  For example, the government could ask: (a) “Yesterday, did you spend time with friends or family?” or (b) overall, on a scale of 1-10, “how satisfied are you with your life nowadays?”  Perhaps the answers could help the government “shape policy” on retirement age and pensions, care for the chronic and terminally ill, unemployment and working conditions.  Borenstein has written one report after another about cockamamie global warming studies, but with that issue starting to lose altitude he may be seeking a different niche.  Our thought: why not ask questions about public satisfaction with the government as a guide to pruning useless activities? 

12/3/13, A6, Regional group wants EPA to use it as a model, Aaron Nathans – The nine Regional Greenhouse Gas Initiative states (including DE) “have signed a letter” to the EPA “encouraging other states to use them as a model to fulfill the agency’s new, more stringent air quality requirements.”  DNREC Secretary Colin O’Mara is quoted that there are various ways to meet the new standards, but “what we’re saying is having an emission cap and trading program is a much more cost-effective, much more predictable way to achieve the same result.” It is stated that the RGGI states have cut their carbon emissions by 40% since 2005, and that the program “has new requirements intended to reduce emissions further, and create more revenue [a slush fund] that the states can use to fight climate change.”  The reduction in carbon emissions reflects a switch from coal to natural gas for power plants in the region, which in turn reflects lower priced natural gas as a result of the fracking boom.  We don’t accept the claim that continuing reduction in carbon emissions is vitally important to stop global warming (the contemplated reductions would at most have a minor effect on global temperatures), but if the claim were true it would be far more cost-effective to impose carbon taxes than to fool around with a cap-and-trade regime (for regions, the United States, or the entire world).  Sorry!

12/3/13, A6, Bloom’s CEO muses about big changes in electrical grid, Aaron Nathans – Bloom Energy’s founder and CEO is reportedly “considering challenging a century-old standard in the electrical [electric power] industry, in search of greater efficiency.”  During a visit to Japan last week, KR Sridhar told reporters that he would like to see fuel cell servers in that country produce direct-current (DC) versus alternating-current (AC) power.  In theory, this could “avoid the 10 percent power loss when [power] is converted from AC to DC.  Many electronic devices and some appliances actually run on DC, which “must be converted from the AC power” available from the grid. Bloom fuel cells can produce either AC or DC power, although up to now they have “conformed to the AC standard.”  According to Dale Davis of CMI Solar Electric in Newark, DE, there would be infrastructure issues in putting DC power on the grid.  “I don’t think we’ll become a DC society.  You’re Don Quixote on that one.”  However, DNREC Secretary Colin O’Mara noted hopefully that “there are significant benefits to DC that weren’t fully understood 100 years ago” and the electric power grid will effectively be rebuilt in the next 30-40 years.  He suggested that a switch to DC would be easier in renewable energy projects, e.g., offshore wind. As we understand it, AC power can be transmitted far more efficiently than DC power at high voltages, which made a centralized power grid practicable in the first place.  And while we have no problem with the tradeoffs being revisited, it should be understood that government won’t subsidize DC power based on theoretical advantages – let power consumers make their choices on a real cost vs. benefit basis.

12/3/13, A8, How Republicans can save Obamacare and themselves, Austin Frakt (a health[care] economist with the US Dept. of Veteran Affairs) – The writer reports that “some conservative policy  pundits are starting to imagine a détente over Obamacare, in which Republicans recognize the conservative nature of the law and support it in return for tweaks that advance their ideas.” Note that GovCare: (a) incorporates aspects of a proposal of Heritage Foundation some years ago, (b) closely resembles Romneycare in Massachusetts, (c) “bears striking similarities to earlier proposals by Republican members [who?] of Congress,” and (d) was not modeled on “the left-wing ideal of a single-payer, ‘Medicare’ for all’ system.” Without casting a single vote for GovCare, Republicans “achieved more than they are willing to admit.”  What sweeteners could conservatives hope to get: (1) offer “more catastrophic plans” on healthcare insurance (HCI) exchanges; (2) adjust the “Cadillac tax” on high-cost HCI policies, which “could help to cap or phase out the employer-sponsored [HCI] tax subsidy;” (3) permit more flexibility for HCI coverage to be offered across state lines to the extent that state regulators would permit it. As for “liberals,” such a deal” would permit them to “rest easier about the law’s future.”  And some “fixes” could be worked into the mix that would advance their objectives: (a) Resolve the “family glitch,” or families that face unaffordable HCI options at work yet are ineligible for subsidized coverage, presumably by authorizing more subsidies; (b) provide an iron-clad exemption from sequestration for subsidies; and (c) clarify the language of the law to expressly provide that subsidies can be provided for HCI obtained on the federally operated HCI exchange that over half the states are relying on.  The upshot would be to cement “a broader, bipartisan coalition for near-universal coverage.”  We often wonder about the motives of people who offer “helpful advice” to conservatives, i.e., if they are so far off base why not just let them keep losing elections until they come to their senses?  GovCare is fatally flawed, and there aren’t any quick fixes that would make it work.  It also is not “conservative” in any way, shape or form.  In due course, GovCare will be repealed and replaced.  The issue is what it will be replaced with.   

12/3/13, A1/A2, Group seeks injunction in Newark; PAC’s activities, bad polling place info come into question, Melissa Nann Burke – Having lost the special election for the mayor of Newark by 115 votes (3% of the total votes cast) to Polly Sierer, Amy Roe et al. sought an injunction to postpone certification of the election results pending investigation of alleged electoral irregularities.  Indications are this effort will fall short and Sierer will be certified as the winner at 6 PM tonight. See also Roe’s letter to the editor (Kowalko deserves praise for standing up for us, A9), which in addition to lauding State Rep. John Kowalko for his support complains about the “proposal to build a power plant next to our homes, schools and parks here in Newark” and reprises “our concerns,” which “range from health to quality of life to problems with government operating behind closed doors.”  The complaints about this project have been given ample publicity already, and they don’t have much substance.  Give it a rest!


12/2/13, A9, Delaware’s small businesses need regulatory relief, Tim Boulden (business owner), Edward Capadanno (business executive), Richard Hefron (Delaware State Chamber of Commerce), Mark Kleinschmidt (New Castle County Chamber of Commerce), & Christopher Rankin (Small Business Alliance) – This column calls for a review and rollback of existing and proposed regulations – primarily at the federal level – and calls on Delaware’s members in Congress (all Democrats) and their colleagues to work on making something happen.  And be especially kind to small businesses, which “don’t have the in-house lawyers and other support staff that help big companies keep up with every minor change and addition to those 175,575 pages of federal regulations.”  We wholeheartedly agree in principle. Regulatory common sense requires eternal vigilance, 11/22/10.  But things are obviously headed the other way right now, and will keep getting worse unless and until there is a change in the political balance of power.  Obama's red tape flood could negate lame-duck status, Washington Examiner, 12/2/13.


12/2/13, A8, It’s time to kill the filibuster once and for all, Jan Ting (professor, Temple Law School) – “If any party can elect a president and a majority in the US Senate that party should be able to confirm presidential appointees.”  The Constitution doesn’t mention filibusters, and it provides for a tiebreaker vote – which supposedly wouldn’t apply if a 60% supermajority were necessary for appointments or legislation.  Therefore, the filibuster is unconstitutional, and “the clown show” that it spawns makes the US a global laughing stock. The Constitution provides that the Senate can make its own rules, and rules restricting the curtailment of debate and specifying a super majority to amend the rules would appear to be within the Senate’s discretion.  As for the alleged harm from not allowing a simple majority to cut off debate, reasonable minds could differ.

12/1/13, A35, Despite abuse, filibuster served important purpose, Ted Kaufman Now and then, former Senator Kaufman writes a column we partly agree with.  This is one of them. Compare our analysis, Senate Democrats execute “nuclear option,” 12/2/13.     As the writer recalls from personal experience (some 20 years as a key staffer for Senator Joe Biden, followed by two years as a senator), the availability of the filibuster in the Senate was comforting to minority members and ensured their views would be heard.  In effect, the majority must have its way but the minority should have its say.  And this is the genius of American style democracy versus, say, democracy in Putin’s Russia, Morsi’s Egypt, etc. where the majority winds up crushing the minority.  Accordingly, Kaufman is “troubled by last month’s vote to change Senate rules [such a vote would have required a 2/3 majority, and the really shocking point is the subterfuge that was used to circumvent this requirement] so that 60 votes are no longer required to end [invoke?] cloture when it involves some [practically all] presidential appointments.” And “I guarantee,” he says, “that further changes in the rules are coming, and they will ultimately have the Senate operate like the House, where there are hardly any minority rights at all.”  Just imagine the GOP taking charge of the Senate after the 2014 elections, at least a 50-50 chance, setting up “an exceedingly ugly two years” (politically speaking) in which the president would probably set “new records” for use of the veto power, and “there would be no new legislation of any consequence.” Yes, “we need major changes in Washington,” but “the massive assault on minority rights that we have just witnessed is not one of them.”  Along the way, however, Kaufman does claim that the Democrats acted due to extraordinary provocation.  Thus, “although the filibuster has been abused in the past by both parties, there has been an unprecedented escalation in its use since President Obama took office.”  His proof: (a) the argument that the 3 vacancies on the DC Court of Appeals did not need to be filled was “disingenuous” [Senate Democrats made precisely the same argument when resisting the appointment of Richard Keisler in 2006]; (b) nominees being held up based on dislike for the agencies they were going to head rather than personal qualifications [Richard Cordray for the CFPB is the only case in point that comes to mind].

11/30/13, A1/A5, Job growth investments task force’s main goal; increased infrastructure spending was proposed, blocked earlier this year, Jonathan Starkey – “Business groups, labor leaders and some state lawmakers are renewing a push to spend more taxpayer money on infrastructure investments as a way to invigorate job growth, after a similar proposal fell apart during initial talks in June.”  Among the infrastructure advocates is Sen. Robert Marshall (D-Wilm.), who is chairing a blue-collar jobs task force.  What projects?  Ideas have “run the gamut from minor spending on road and waterway projects, to utility upgrades at state parks, to an expensive natural gas pipeline that could help lower electric bills for large companies downstate.”  The governor and Democrats were rebuffed, however, “when they attempted to create a bipartisan coalition to raise taxes and fees” to pay for some of the increased spending.  Political pressure not to raise taxes “will only increase next year,” with elections coming up for most Delaware legislators.  Another possibility is to borrow money more aggressively, although the governor is quoted as being worried that this would be irresponsible. Comments: (1) The gas pipeline for Sussex County would be privately funded (at last report $165M).  Gas pipeline eyed for Sussex, 6/2/13. (2) Last June, Republicans complained that a list of tax increases and added spending was being floated too late in the legislative session.  Markell details tax, fee options; legislators flinch at some ideas, 6/13/13. (3) From his quoted comments, Senator Marshall seems to be looking for a “quick fix” that demonstrates intent “ . . . if we can make some effort and move in a direction to create opportunity and hope [we can] let Delawareans know we are serious about creating some form of employment” – versus improving the business climate and allowing the private sector to carry the ball.

11/30/13, A11, Why we should give Reach Academy another chance, Jim Hosley (CRI) – The gist of this column is that Reach (an all-girls charter school in Wilmington) is being closed based on poor test scores and the Department of Education’s assessment of school leaders.  Granted, the decision is defensible, but many parents and students are disappointed.  A public school with such problems would not be treated in a similar manner.  So, why not take another tack?  Let’s “rally resources and lead a turnaround; and develop from this experience a transferable process that can be used by other communities to reform their schools.”  The closure of Pencader Academy earlier this year was a worse decision in our opinion, but attracted far less opposition.  State monitors flunk Pencader, 2/22/13.

11/30/13, Level the playing field for all merchants – This editorial endorses the Senate bill to authorize state sales taxes on interstate transactions, thereby ensuring that on-line merchants will not have an unfair advantage over physical stores.  “It is not our fight in Delaware, but the Senate has it right.  The sales tax should be a sales tax . . . period.”  The general thrust of authorizing sales taxes on interstate commerce may be sound, but there are major problems with the Senate bill – which need to be fixed before legislation is enacted.  Also, Delaware’s members have supported the legislation for a reason that does not bear close scrutiny, namely the unlawful edge that it would solidify for physical stores in Delaware. Congress in action: Internet sales tax bill, 5/13/13

11/27/13, developments re data center proposalA1/A2 - [Polly] Sierer wins Newark mayoral race; Large turnout in contest with 7 candidates vying to succeed Funk, Melissa Nann Burke – Was it a large turnout?  3,695 votes were cast, about 25% of the registered voters. Pro-business candidate Sierer (the winner with 41% of the vote) announced her interest in meeting with the other six candidates, remarking that “we have a polarized community right now” and “we need to regroup and come together and work towards the same goals to make this a great place to live, work and visit.”  DC opponent Amy Roe got 38% of the vote, so look for a continuing campaign against the project.  B3, County punts on data center; Council tables motion to support Newark project, Adam Taylor & Melissa Nann Burke – The proposed resolution in favor of the DC project was simply to show support, but it had to be tabled “because it didn’t have enough support to pass.”  Reportedly, some members of the County Council “said they received dozens, and in some case hundreds of e-mails, from people who oppose the project asking that it be voted down.” Do Delawareans really want a prosperous state economy, jobs, etc.?  If this project is so unpopular, despite big benefits and little in the way of subsidies, it’s hard to see how any industrial project could pass muster.

11/26/13, A3, Prospects brighten for small-scale budget deal – Closed door negotiations between the co-chairs of the budget conference committee, Rep. Paul Ryan and Sen. Patty Murray, have been going on and reportedly will continue the week after Thanksgiving even though the Senate will be in recess.  “Both sides profess optimism while working hard to minimize potentially damaging leaks that could derail their efforts” to find common ground.  If there is a deal, according to this story, it could take the form of “splitting the $91 billion difference between what Senate Democrats and House Republicans want to spend next year on operating budgets of the Pentagon and domestic agencies.”  What about proposing some specific spending cuts?  Otherwise, GOP should stick to the sequestration provisions of the Budget Control Act of 2011.

11/26/13, A1/A2, Data center supporters hold rally; hundreds gather to back plan day before election, Melissa Nann Burke – The vocal supporters of DC are unions, and from this story they have let their feelings be known in an effective manner.  The story includes a big picture (A2) of demonstrators along South College Avenue, brandishing signs and facing passing cars. Polly Sierer is identified as the favored candidate, although she has still not taken a public position on the DC.

11/25/13, Data center a motivator at polls; Mayoral race marked by outside money, groups, Melissa Nann Burke – Newark residents will head to the polls tomorrow for the purpose of electing a new mayor.  Some 15K people are eligible to vote, but a lot fewer will likely do so (the highest turnout in recent history was in 2004 – 23% of the registered voters).  Of the 7(!) candidates on the ballot, all without a designated party affiliation (Newark “practices nonpartisan politics”), five oppose the proposed data center/power plant on UD’s Star Campus and the other two have not “taken sides in the debate.”  Based on money raised, at least, it sounds like the likely winner will be either Polly Sierer (a self-described pro-business candidate) or Amy Roe (who has opposed the data center/power plant from the get go).  Currently, the project is hanging fire pending a decision on whether it meets zoning requirements.  Democracy in action can be messy; let’s hope this ends well. 

11/25/13, Despite problems, two-and-a-half cheers for Obamacare, Saul Hoffman (UD economist) – Professor Hoffman has written one column after another praising GovCare and slamming Republicans who find fault with it, as he acknowledges in this column by describing himself as “a vocal advocate.”  See, e.g., “Obamacare needs to be strengthened, not defunded,” 10/16/13. This time, he acknowledges “two issues with traction.”  One is the poor initial performance of the website for enrolling in approved healthcare insurance (HCI) policies, although Hoffman says the problems “are technical, not substantive” and “will be resolved.”  The second problem, cancelled insurance policies, has supposedly been “greatly exaggerated.”   Affects a very small percentage of families [unclear, as the employer mandate was postponed for a year] – cancelation of “bare-bones” policies was a good thing as such policies are useless – cancelation of Cadillac plans in the individual insurance market was necessary to prevent insurance companies from screening out “less healthy” people, leaving them to buy higher-priced policies or get no insurance at all.  “Obamacare makes cherry-picking in [HCI], which adds to the overall administrative costs of the US healthcare system without providing any benefits, a thing of the past.” [Not really, but the screening process will take a different form.  Race to the bottom in the Obamacare exchanges, John Goodman,, 9/28/13. And remember, “a top-of-the-line platinum policy will be available on the [HCI] exchanges to families with those canceled policies *** [providing] guaranteed coverage with no increase in rates.” [Subsidies are not available for all of the people involved, and even if they are available it’s not “free money” because the taxpayers still have to pay.]

11/24/13, Senate Democrats use the “nuclear option” to eliminate filibusters – Perhaps the move was inevitable, Republicans had threatened it themselves a few years ago when Senate Democrats were aggressively blocking judicial and administrative appointments of then President Bush, but it will predictably sharpen – rather than overcome – partisan differences in Washington.  The rules change was passed 52-48, with Democratic Senators Mark Pryor (AR), Joe Manchin (WV) and Carl Levin (MI) voting no. (A)11/22/13, A3, Democrats curb GOP blocking of appointments, Susan Davis & Richard Wolf (USA Today, supported the change, e.g., citing Senator Harry Reid’s claims that “in the nation’s history, there have been 168 filibusters against presidential appointments” and “half of them have occurred during the Obama administration – during the last 4-1/2 years.” The turning point is said to have been the GOP decision to block all three nominees to the US Court of Appeals for the District of Columbia Circuit, a court with “vast jurisdiction over federal agencies and regulations,” on grounds that no more judges on the court are needed.  Republicans warned that Democrats may regret the decision if they return to the majority, but the president applauded the Senate vote on grounds that “over the past five years we’ve seen an unprecedented pattern of obstruction in Congress that’s prevented too much of the American people’s business from getting done.” It is stated that the change did not apply to Supreme Court nominations or to legislation, but everyone knows this limitation won’t hold if it ever becomes inconvenient to the party in power, e.g., there is a controversial Supreme Court appointment under consideration. Once it is accepted that the rules can be changed by a simple majority vote, as several observers have noted including columnist Charles Krauthammer, then there are no rules.  (B)11/24/13, A10, Gridlock pushes Democrats to breaking point; “Untenable situation creates filibuster fix, Charles Baington (AP) –Having “watched Senate Republicans use filibuster power to thwart more and more of President Barack Obama’s agenda and nominees,” Democratic party leaders are said to have concluded “GOP obstruction had made a mockery of American democracy.”  The story goes on to quote the president in favor of the decision.  Republicans used the filibuster “as a reckless and relentless tool,” he said, “simply because they opposed the policies that the American people voted for in the last election.”  Also, the president “told reporters that in the 60 years before he took office, only 20 presidential nominees to executive positions had to overcome filibusters” and “in just under five years since I took office, nearly 30 nominees have been treated this way.”  Compare to Harry Reid claims cited above, which were to the same general effect but used a different data set.  To his credit, the reporter points out that the shoe was on the other foot when the Republicans were in power, and that some observers say “the quarrels will grow even hotter” with the rules change. We’re not sure, but think the actual writer of this story may be Charles Babington.  Also the “Gridlock pushes Democrats to breaking point” title was used for a one-sided MSNBC story by Steve Benen. (C) Editorial coverage or comments by Delaware members of Congress. None so far, but we did see a Politico story that begins with Senator Carper’s decision to back the rules change. The stated rationale was that the Senate is not getting anything done, has passed a record low number of bills, etc., which may be true but has little if anything to do with how presidential appointments were being processed.

11/22/13, B1/B2, Bowers comes up short in FEMA review, sanctioned, Jeff Montgomery – “Citing longstanding rule violations, National Flood Insurance Program managers ordered probation Thursday for the town of Bowers Beach, triggering a $50 annual surcharge on policyholders and raising the specter of suspension if the Delaware Bay community fails to make progress on reforms after six months.”  FEMA representative Peter Herrick attributed the decision to the town’s failure to “remedy all the deficiencies that we identified when we first contacted them.”  Further sanctions that could be invoked if the town does not toe the line in a manner deemed satisfactory by FEMA: the feds could suspend flood insurance coverage & issuance of federally backed mortgages, and maybe even “bar the town from receiving some forms of disaster assistance.”  It is reported that “dozens of dwellings” in recent years were “constructed or upgraded with features violating FEMA rules . . . keeping all living space, fixtures and storage, and floors or supports above flood levels specified for their properties  . . . walls built below flood stage [must] be light enough to ‘break away’ when tidal surge pushes water inland.”  Michael Powell of DNREC says state officials have been “working with the town continuously,” but says the effort has been “challenging” because the applicable federal requirements and the flood plain maps have both changed “a couple of times.” Individual properties are therefore being compared to different maps and/or sets of regulations. And new flood insurance rate maps have raised the likely flood height in a 100-year storm from a previous maximum of 13 feet to 14 feet, which “will make homes already out of compliance with federal rules even further out of whack at a time when insurance rates are beginning to skyrocket.” No wonder local residents are mad about the way they are being treated.  Raising insurance rates to realistically reflect the hazards is one thing; browbeating owners about technical problems that can’t be fixed without razing their properties and starting over is another. And when adjustments are possibly being based on alarmist sea level rise scenarios, the situation gets that much worse.     

11/21/13, A9, Ignore climate alarmist’s computer models, Gregory Inskip (Wilmington) – The writer takes issue with Gov. Markell’s attribution of extreme storms to global warming, as reported on 11/15/13 (Coastal leaders forcing dialogue; low-lying areas start to face tough choices, Jeff Montgomery), citing, of all things, the recently published Fifth Assessment Report of the IPCC.  And “even the IPCC concedes that from 1998 to 2012 there has been a ‘reduction in surface warming trend’ – another way of saying no warming at all.”   

11/21/13, A9, DuPont offers safer choices than fossil fuels, Jan Koninckx, DuPont Industrial Biosciences – The writer responds to 11/12/13 editorial that slammed the ethanol blending program for motor fuels, claiming that it “perpetuated a litany of falsehoods about renewable fuel.” (A) It is pointed out that direct ethanol subsidies have been eliminated, although mandating the use of ethanol has the same effect.  (B) There are some quibbles about an AP story cited re marginal land being cultivated in order to supply corn for ethanol, e.g., “farmers have increased corn acreage in response to drought-ravaged corn supplies, not due to ethanol.” Ever hear of fungibility?  (C) A study by an “independent economist” is cited, which purportedly found that “the Renewable Fuel Standard [RFS] . . . that supports [mandates] biofuels, saves consumers 50 cents to $1.50 per gallon of fuel.” Given that ethanol accounts for only 10% of the motor fuel (higher percentages would damage auto engines), and reduces miles per gallon besides, this claim seems dubious. But if it were true, the mandate would be unnecessary because refiners would be anxious to reduce their costs. (D) We “know for certain” that “the fossil fuels we burn today are having a dangerous impact on our environment.”  Ethanol is burned just like gasoline, so even climate alarmists should be skeptical of the implied environmental benefits.  (E) DuPont will provide a choice by building a biorefinery in Iowa to produce cellulosic ethanol.  That’s nice, but DuPont hasn’t been willing to forego the RFS mandate and allow genuine choice by producers/consumers.  DuPont set to move ahead with refinery, 9/23/12.

11/20/13, JPMorgan, feds settle for $13B; Delaware gets $20M in deal over misled investors – “[JPM] has agreed to pay $13 billion in a landmark settlement and acknowledged that it misled investors about the quality of risky mortgage-backed securities ahead of the 2008 financial crisis.”  It was the largest ever settlement between the US government and a corporation.  Several states will receive direct payments as part of the deal: CA, MA, Illinois, & NY for a combined $748 million and Delaware for nearly $20M.  Delaware AG Beau Biden, pictured on page 1, is quoted that “this is a very important effort on our part to make sure those who were responsible for doing these things were held accountable.  It’s not the end but it’s an important step in the effort to hold those responsible accountable for (actions that) basically brought this economy to its knees in 2008.”  The DE AG’s office coordinated with other state AGs and the US Department of Justice during the investigation.  There are likely to be similar settlements with other big banks, and despite upbeat statements by JPM, it is not entirely out of the woods – notably, there is an ongoing federal investigation of possible criminal charges “focused primarily on JPMorgan employees” (suggests there will not be criminal charges against JPM as an entity). Objectors: BofA’s $8.5B settlement is miniscule, Bloomberg News, A10 – A proposed settlement by Bank of America with mortgage-bond holders is being reviewed in New York courts.  Daniel Reilly, an attorney for AIG (the lead objector to the settlement), is quoted as calling the settlement “miniscule” in a supposedly closed court proceeding.  In total, BOA is attempting to settle about $50B in legal claims, including those the bank inherited with the purchase [at the request of the government, with insufficient time to do adequate due diligence] of Countrywide Financial Corp. in 2008.” JPMorgan settlement should be used for housing, A12 – According to this editorial, the $20M for DE is partly spoken for: $7.6M will reimburse state funds for losses on “toxic” mortgage-backed securities; some money will go to state mortgage remediation programs and legal services involving foreclosures; the remainder will be “left over”.  It is urged that the money not be used to “plug budget holes,” but instead “be directed to help homeowners adversely affected by the mortgage bundling” rather than being treated as a “windfall.” Although JPM is big and strong enough to cover the $13B settlement, this is not “free money” – in one way or another, such costs do get passed on to the public.  We have never been convinced that the private sector was solely responsible for the fiscal crisis in 2007-2008. While banks, rating firms, etc. are being pursued relentlessly for the mistakes they actually or allegedly made, in some cases settling because it can be suicide to oppose the government aggressively, we have yet to see a single person in government service or the Federal Reserve held accountable for their mistakes.  As for ensuring that such a financial crisis never happens again, assuming there is any way to do this, next to nothing has been done.  SAFE is considering further comment on this situation. 

11/19/13, A10/A11, putting a “progressive” spin on the Gettysburg Address – It’s inevitable that historical events come to be viewed through the lens of current perceptions and experience, but the results may distort rather than illuminate. Consider these examples: (A) 150 years later: Lincoln’s words apply to us as well, Senator Tom Carper: “The world will little note, nor long remember what we say here,” said Lincoln, “but it can never forget what they did here.”  Sure enough, the fallen soldiers did not die in vain, for the union was preserved, slavery was ended, and the United States went on to accomplish great things.  At the peak of success, Carper characterizes the nation “emerging as the 21st Century dawned with the strongest economy and the most productive workforce on earth, a balanced budget, and the respect of much of the world as the mightiest force for justice on our planet.” Now, a mere 13 years into the new millennium, however, “it almost seems that we are involved in another civil war.” The shots fired are rhetorical this time, and the “battles” are “topics such as healthcare reform, the growing divide between the haves and the have-nots, equal pay for equal work, spending and taxes, and balancing our right to privacy with our need to protect Americans from those who want to harm us.”  Gridlock grips Washington – lurching from fiscal crisis to fiscal crisis – willingness to communicate and compromise has fallen out of fashion.  So if Lincoln was alive and serving in the White House today, no doubt he would be cajoling legislators and twisting arms on Capitol Hill, but withal “show[ing] compassion to his opponents.”  In his day, Lincoln prayed often for wisdom, read the Bible daily, and believed the Bible’s “admonition that we have a moral obligation to help the least of those in our society in a way that’s fiscally sustainable.”  He also loved a good story, liked to laugh, and “might even be pretty good on television and Twitter.” Really, Gettysburg and the Bible are about the redistribution of wealth and fiscal sustainability?  (B) Are the ideals of Gettysburg Address alive today? A number of student essays (elicited with help from Fran O’Malley at UD) were received, of which two are printed. A Mount Pleasant High student: “Lincoln is explaining how nobody will remember what people think or say, unless the American people pull together and do something.”  Therefore, everyone should carry out his or her responsibility by voting.  What about getting informed about the issues and attempting to educate others?  Or becoming a productive member of society, who pays taxes instead of drawing benefits?  A Cab Calloway student: “The purpose of the speech was to encourage the nation to persevere during the tough time of a civil war,” which nowadays means that “we must strive to keep the virtues that America started on: freedom, liberty, and equality.”  And when Lincoln said “government of the people, by the people, for the people, shall not perish from the earth,” this suggests that “our government should . . . make their [sic] decisions and actions based on the good for all people, rather than their own personal motives or social gain.” The Declaration of Independence proclaims the inalienable rights of people, which the government is formed to preserve rather than supersede.  And while stating that “all men are created equal,” the Declaration references “life, liberty and the pursuit of happiness” as rights – not “equality.” Compare the “Liberty, Equality, Fraternity” mantra of the French Revolution – which had less fortunate results than the American Revolution.  (C) Can government “by the people” avoid perishing? This editorial suggests that veneration of the Gettysburg Address can become mindless, so it’s important to examine the ideas that it expressed. In his time, by referring to “government of the people, by the people, for the people,” Lincoln was issuing a bold challenge to those fighting or supporting the Civil War.  It was that people who were “created equal” should be able to establish and run a government on their own behalf without falling into corruption or despair? Yes, we can, said Lincoln, and things worked out – then and for many years to come.  But can we keep it up today?  “Look at our government.  Is it too big, too ridden by special interests, too powerful?  Look at us.  Are we willing to compromise?  Sacrifice?  Or are we willing to see such a government perish from this earth?” We agree that the government is too big and ridden by special interests [or perhaps more accurately political factions united by economic interests or ideology].  Does reference to “compromise” and “sacrifice” suggest, however, that Americans should shrug their shoulders, say “oh, well,” and accept the situation?  The Declaration of Independence is quite explicit that the government is supposed to work for the people, rather than vice versa, and that “whenever any form of government becomes destructive of these ends, it is the right of the people to alter or to abolish it, and to institute a new government.”     

11/17/13, A29, Sequestration’s pain will hit us in the future, (former Senator) Ted Kaufman – “We knew from the beginning that the mindless across-the-board sequestration cuts would hurt a lot of people.”  But the effects are not readily visible, says the writer, because many of the bad effects fall in the “we’ll never know” category.  How many thousand kids will drop out of school because they got kicked out of Head Start programs – billions of tax revenue be lost, and tax cheats go free, because of cuts in the IRS enforcement staff – advances in treatment for diabetes or cancer be lost because the National Institute of Health was forced to kill promising research programs – R&D programs be cut back, stalling economic growth?  Virtually all reputable economists agree that maintaining and increasing R&D programs is crucial to help create jobs and prosper in a globalized economy.  And according to a Breakthrough Institute report, the government has historically played “a critical role in the development of many of the technologies and industries that now form the bedrock of modern society.”  Sure, “one of the reasons for America’s great success has been a system that creates and rewards risk-taking business entrepreneurs.”  But although “Apple did a great job of putting them together,” the iPhone building blocks (e.g., microelectronics, wireless networks, touch-screen displays, even SIRI) “were all originally developed by government researchers.”  See also a 2012 report from the National Science Board, which finds that the private sector is not likely to support enough basic and applied research “to create a knowledge base of potentially transformative ideas that are critical building blocks of innovation.”  So now we see “wise public policy” pitted against “a cut-government-at-any-cost ideology.”  And things could get far worse “unless the current House-Senate budget talks result in some agreement by Jan. 15” to “dump sequestration.”  Let’s go, already! The writer seems to consider all government spending as of equal value, but this is simply not true.  Even assuming all of the programs mentioned are 100% justified and should be exempt from budget cuts, there is a ton of waste in a nearly $4 trillion annual budget.  So why not agree on targeted spending cuts to pay for lifting sequestration?  The only obstacle is the almost fanatical demand of Democrats on the budget conference committee for tax increases (scornfully rejecting revenue neutral tax reform, which would bolster the economy and enhance revenues over time) as the price for cutting a deal. 

11/15/13, let’s have informed and fact-based debates versus the “party line” stuff – It’s partly the fault of political activists trying to get their way and partly the fault of an ideologically-biased media, but overstated and dubious claims seem to keep coming nonstop.  Herewith two examples and a fine letter to the editor: (A) Coastal leaders forcing dialogue; low-lying areas start to face tough choices, A1/A10, Jeff Montgomery: Yesterday, Gov. Jack Markell of Delaware and Sen. Sheldon Whitehouse (D-RI) spoke during a Q & A session led by PBS Newshour correspondent Gwen Hill.  Their comments are uncritically reported without disclosing whether other panelists were involved let alone whether contrary views were expressed. Starting from the point that coastal property owners in Delaware should face the reality that the government does not stand ready to devote unlimited resources to storm damage restoration, etc., Markell moved on to the presumed linkage of Typhoon Haiyan and Hurricane Sandy to global warming based on the burning of fossil fuels. Following the maxim about “never let a good crisis go to waste,” he said that “when people are listening, this is a time for us to be aggressive in communicating” about risks, possible responses and long-term local, state and national policy decisions.” Then there is an extensive recitation of what the new IPCC report will supposedly say when it is issued next year (e.g., “very high confidence that the atmosphere is rapidly warming”), an assertion (no source cited) that average global temperatures by 2100 “could range as high as a catastrophic 8.6 degrees [F]” over the current level, and a reported statement of the UN’s World Meteorological Organization “that 2013 is on track to rank among the 10 warmest years since modern records began in 1850, while Arctic sea levels fell to one of the lowest extents on record.”  An unnamed person in the White House is quoted that “this is absolutely stone, cold real and there’s going to be a price to be paid for all the messing around we’ve been doing instead of tackling the problem.”  Just because Washington is “dysfunctional,” says Markell, “that’s no reason for governors, mayors, county executives and councils not to do what we have to do.”  You would never guess from this story that the global warming trend has paused over the past 17 years, coastal storm surges are hardly something new, and rising sea levels in our region are due in large part to sinking of the land.  And if the global warming trend is destined to resume, for whatever reason (the causes of long-term climate variations are not well understood), switching to alternative energy sources, etc. will not stop it.  Let’s get real! (B) Activist levels Common Core in talk to Kent GOP, B1/B2, Matthew Albright: The speaker was Anastasia Przybylski from Pennsylvania who is associated with Freedom Works, a “conservative grass-roots advocacy group.”  For identification, Common Core is said to be “a set of standard expectations for what students should be expected to learn being implemented in 45 states,” with “Delaware teachers among the furthest along in overhauling what they teach to meet the standards.”  It is further stated that “every state education policymaker, from Gov. Jack Markell to the Department of Education supports the standards.”  Political opposition has surfaced in a “few other states,” but “that debate” has largely missed Delaware so far except for “some small groups not connected to political parties.”  Finally, the points made at the meeting are stated: (i) standards take power out of the hands of local parents and school boards; (ii) Common Core is essentially a federal initiative, which is at odds with state control of education.  However, the governor is on record that worries of a federal takeover are “mythology;” and (iii) Government officials are collecting an awful lot of data on individual students, which could very well be misused.  Kent Republican Chairman Hank McCann said the event had been arranged due to constituent questions about the Common Core standards, but “acknowledged that it’s unclear exactly what the state could do at this point given that teachers have been implementing the Common Core for more than a year.”  For all the denials, Common Core standards have been pushed by the federal government rather than spontaneously being developed by the several states.  What’s more, they clearly relate to the curriculum (else why would teachers be spending so much time on implementation) and not just to the evaluation of educational results.  Will Common Core standards enhance US education? 8/5/13(C) Banning opinions would be disgraceful, 11/14/13, A11, Victor F. Battaglia Jr., Wilmington: The writer expresses agreement with John Sweeney’s recent column that letters from global warming skeptics should continue to be published rather than ignored.  “Free societies encourage the exchange of ideas . . . stifling and opposing opinion leads to anger and violence.”  As for frustration about “folks who ignore the facts,” that idea – strangely enough – “is shared by both sides. *** Imagine an editor refusing to print YOUR opinion because of the subject – you’d be scandalized.”

11/14/13, budget conference committee (BCC) holds second meeting – The BCC met again yesterday to hear from and dialog with Congressional Budget Office Director Doug Elmendorf.  The two-hour hearing was aired on C-Span (  Dr. Elmendorf reported that the deficit for fiscal year 2013 was the lowest since 2008 and will probably keep declining over the next year or two, but that longer term the deficit will spike back up, debt will represent a growing percentage of Gross Domestic Product, and government outlays for “discretionary” programs will be increasingly squeezed by rising outlays for social welfare (aka entitlement) programs. He suggested there are three general responses to the long-term fiscal problem, and many permutations and combinations as the ultimate response will probably be a mix:  (a) prune entitlement programs, (b) raise taxes, or (c) spend less and less on the military budget and other discretionary programs.  He also expressed the thought that if the BCC can’t agree on a long-term deal right now, it would probably be better to do a short-term deal – so as to substitute mutually agreed deficit reduction measures for sequestration and resolve the “uncertainty” about what is going to happen that is believed to be impeding economic recovery – than to continue having fiscal crises every few months.  A CBO book of deficit reduction options was released for consideration. Following this testimony, Co-Chair Representative Paul Ryan (presiding with the apparent consent of Co-Chair Senator Patty Murray) called on all of the BCC members in attendance who indicated a desire to speak (by standing their place cards on end), in alternating party order, for 2-minute statements (or questions for the witness, generally of the “leading” variety).  At the end, several members took a second turn.  The proceeding was civil, unfolded crisply, and ended just before the 120-minute mark.  Here’s a sampling (not in order) of what was said:  (A) Co-chairs Ryan and Murray have been holding private meetings in an effort to work out a deal and will continue to do so.  However, Ryan wryly noted, “it has been easier to identify what we don’t agree on than what we do agree on.”  (B) Representative Tom Cole (R-OK) asked whether there were enough proposed spending cuts in the House, Senate & president’s budgets to pay for eliminating sequestration.  (C) Senator Angus King (I-ME) rattled off a complicated 10-year plan, apparently involving a reduction but not total elimination of sequestration caps, corporate tax “reforms” that would only partially be offset by lower rates, etc., which he suggested includes “something . . . for everyone to dislike.”  Ryan urged all of the BCC members to shoot in their ideas for consideration.  (D) Several members referenced the percentage of taxes to Gross Domestic Product, which over the next decade is projected to exceed the historical average over the past several decades.  Republicans took this as evidence that taxes should not be increased any further, while Democrats said taxes as a % of GDP had been higher than the historical average in the few years when the budget was actually balanced (1998-2001).  (E) Senator Chuck Grassley (R-IA) suggested that sequestration is working and should be left in place, even at the risk of weakening national defense, since in the long run the US won’t be able to afford a robust national defense without a strong economy.  (F) Senator Ron Johnson (R-WI) hammered on what GovCare will “really cost” and whether the fiscal burden involved has been underestimated, but Director Elmendorf stood by the CBO’s finding that the overall effect of this program (including tax increases embedded in the legislation) will be to reduce the deficit. (G) Senator Ron Wyden (D-OR) referenced the purportedly wrongheaded tax treatment of derivatives and suggested there must be a couple of egregious loopholes in the tax code that could be eliminated without jeopardizing broader tax reform. (H) Senator Whitehouse (D-RI) said that healthcare in the US now accounts for 18% of GDP and is headed up, which is a sign of how inefficient the US healthcare system is and shows the potential of saving up to about $1T a year (including perhaps $400B in federal outlays) by smart healthcare reform.  (I) Senator Bernie Sanders (I-VT) said economic distribution in the US is less equal than at any time since the 1920s, and more Americans are living in poverty than at any time in history.  He blamed going into deficit on the war in Iraq, which “will cost $3 trillion by the time we get done” with all the veteran’s benefits, etc. (J) Representative Nita Lowey (D-NY) said sequestration is costing the economy 800K jobs; she claimed there is a bipartisan demand to do a deal that would lift sequestration for 2014 and 2015 so the appropriation committees can do their jobs properly.  (K) Senator Mark Warner (D-VA) observed that Bell Labs no longer exists, the US economy is dependent on government funding for basic R&D, and sequestration is cutting off our nose to spite our face. (L) Concern was expressed about long-term unemployment, which tends to become irreversible, plus the fact that the new jobs being created are mostly low-paid, low-skill jobs versus “living wage” jobs.  Senator Chris Coons (D-DE) suggested that one answer in this area might be more generous funding for R&D programs.  (M) Senator Jeff Sessions (R-AL) referenced an IMF report that shows spending cuts are more helpful than tax increases in bringing down the deficit without harming the economy. Director Elmendorf said that any conclusions on this score would depend on the details, i.e., there was no universal rule as to the best approach. This session was not heavily covered by the media, e.g., all the News Journal carried was a brief story (on A3) entitled “Congress indicates little movement in budget talks.”  Ongoing talks between the co-chairs were noted, and Representative Ryan was quoted:  “We’re trying to find common ground, but we’re not there yet.”

11/12/13, A5, Deeper spending cuts loom in year ahead, A5, Andrew Taylor (AP)Photo: Senate Appropriations Committee Chair Barbara Mikulski (D-MD) at podium, flanked by Senators Dick Durbin and Charles Schumer, on Aug. 1. The gist of this story is that year two of sequestration will be worse than year one, not simply because the dollar amount of spending reduction will be $20B higher but also because the supply of previously appropriated but as of yet unspent money has been pretty well exhausted.  According to Senator Mikulski, government agencies “squeezed everything to get through the first year thinking we would come to our senses.”  Currently, the budget conference committee’s “priority” is said to be “finding replacement cuts.”  Alas, “many observers think the talks won’t bear fruit.” This could mean: “some women with toddlers lose coverage next year” – air traffic controller furloughs (can’t keep tapping airport construction funds) – lots of money “squeezed out of the Pentagon,” eroding combat readiness and grounding Air Force squadrons – “unpaid furloughs” at the FBI, which has already suspended training of new agents and instituted a hiring freeze.  What’s missing here is any mention of the abject failure of Congress, thus far, to start cutting wasteful spending.  To cite but one example: Billionaire farmers raking in farm subsidies; Tim Carney, Washington Examiner, 11/7/13.

11/12,13, more re Newark data center – (A) Council reviews budget plan; Official: Data center will not erode power revenue;B1/B3, Melissa Nann Burke – Finance Director Lou Vitola stated at a City Council meeting that the city’s revenue stream from sales of electric power to UD would not be eroded by any power purchases from the data center power plant.  Rationale: minimum service delivery charges under UD’s contract with DEMEC (city of Newark’s power system).  “We’ve had that triple checked by three different lawyers,” added Councilman Stu Markham.  The city has received additional information from The Data Center, LLC and is expected to make a decision within a week as to whether the proposed power plant is permitted under the zoning code.  (B) Three more letters on the editorial page: David Cassling implies laxity of regulators and criticizes “secretive” tone of “the whole affair.”  Karen Barker cites annual emissions, including “900,000 tons of greenhouse gases,” and says “no one should be breathing these things,” so clearly the governor, Better Business Bureau, and GOP legislators “are putting money  ahead of the health and well-being of our citizens.” Kevin Irwin, recently retired president of Iron Workers Local 451, says jobs and tax revenues are needed and the data center people impressed him. “We as Delawareans need first-class employers like the ones I met.”  Why keep “pushing good clean jobs all the way to China or elsewhere”?

11/10/13, A27, What can we expect from Washington’s next meeting?  former Senator Ted Kaufman – The writer offers little hope for a breakthrough by the budget conference committee (BCC), but predicts there will not be another government shutdown in January because the majority of congressional Republicans “know the shutdown was a disaster and . . . aren’t about to go down that path again.”  Most likely what the BCC proposes “will be short-term and unlikely to settle any of the significant differences that have prevented us from making badly-needed long-term decisions and investments in our future.”  Currently, Kaufman suggests, there is a disconnect between what the parties are supporting and what their respective bases should logically want.  Thus, the GOP is the party of older whites – consumers of Social Security & Medicare benefits – so why should they be pushing for cuts in those programs?  Dems are the party of youthful-tilting minority groups, yet they have tolerated “a dramatic shift of federal funding” away from younger Americans.  Consider that in 1960, “children and seniors received essentially equal amounts of the federal budget.”  Now seniors get more than three times as much “and the gap will increase if the projected budgets remain in place.”  In the not so distant future, look for changes in the parties’ positions to “more closely reflect where they get their political support.”  Clearly, “youth will be served” at some point.  Accordingly, one would expect the two parties to wind up competing for the support of this demographic. In Kaufman’s view, however, the GOP may be too dumb to figure this out.

11/10/13, interesting letters to the editor(A) Markell, data center hurting Newark, state, Leonard W. Schwartz (Newark) - Ho hum, one more letter from a Newark resident complaining about the proposed data center/power plant, but this rebuttal to Governor Jack Markell’s recent column is better written and more thoughtful than most. Likening the proposed project to the failed Fisker venture that led to “a loss to Delaware taxpayers of more than $20 million” is not apropos as that was a heavily subsidized venture and the data center would not be, but the comments re the company that proposes to build the data center might warrant looking into.  “Here we have a shell of a company with no discernible resources, no experience in either power plant or data construction, that refuses to provide either its financial or engineering plans.”  Other arguments include the claim that the power plant is much bigger than it needs to be, the venture would be “a blight on the surrounding residential neighborhoods,” and “a real estate agent stated that buyers are already being scared away by the proposed power plant.” (B) Lower taxes on carbon, business to get work, David Stevenson, CRI – According to the writer, the EVRAZ Claymont steel mill was “half as profitable as two other manufacturing facilities in Portland, Ore., and Regina, Saskatchewan [apparently also owned by EVRAZ], making Claymont the obvious choice for closure.  And Stevenson’s analysis identifies “the net effect of high electric rates and high corporate tax rates” as a big reason for the difference.  Also, “the other plants are less costly from economies of scale as they are larger.”  The call for action: “Let’s build natural gas electric generators, retire the carbon tax, lower corporate taxes, and get Delaware working again.” Seems to us that CRI might want to weigh in on the data center/power plant proposal in Newark, which to our knowledge they have not yet done. 

11/9/13, A9, Meet the new “center” of the Republican party, Michael Heyman – According to the writer, who “lives in New Castle,” the government “shutdown” of three weeks back permitted citizens to witness “what happens when government runs amok – or when there’s no government to stop things from running amok.” We give up, what does Heyman mean by “government runs amok” as he goes on to praise everything the government has ever done?  This “dysfunction was a stain on the institution of government,” and it’s all the doing of “the tea party and their enablers in Congress,” whose “libertarian ideology restricts government activism.” If these folks could have their way, “they would uncheck everything beneficial the government has done” – from Ellis Island and ending segregation to GovCare.  Only when “they saw how irate citizens were becoming [due to] the governmental chaos” did “the more moderate among them cut their losses and [compromise] on a face-saving way to end the shutdown.”  But don’t be fooled, because the radicals are now in charge of the Republican Party while those “who used to be considered moderates” are on the fringe.

11/9/13, A1/A5, Cancel notices hit Del. insured; About 5,300 residents forced to change plans, Beth Miller –Highmark Blue Cross will reportedly cancel individual coverage for 5,300 Delaware residents due to noncompliance with GovCare requirements, of which 1,800 policies will be discontinued Jan. 1 and the rest during the balance of 2014.  The president’s apology for “similar cancellations nationwide during an interview with NBC News” is reprised (see 11/8/13 story below).  Somewhat confusingly, the story goes on to quote the Highmark Blue Cross spokesperson (Matthew Stehl) as saying the policies of about 3,800 Highmark members “could be ‘grandfathered’”, perhaps referring to changes in the law that could be made to permit people to keep their existing healthcare insurance (HCI) if they want to.  Stay tuned for the release of actual enrollment data in HCI policies on the new government-run exchange.  According to DHSS Secretary Rita Landgraf, “at least 50 people have enrolled statewide [in Delaware], and others have opened accounts and are reviewing their options,” but she reportedly “wants to verify the state’s numbers before releasing them.”

11/8/13, A1/A2, Obama: Sorry for lost policies; But he stops short of regretting pledge, Julie Pace (AP) – NJ gives front page coverage to story based on the president’s interview on NBC News yesterday in which he acknowledged that his past assurances that people who liked their healthcare insurance (HCI) could keep them were not entirely accurate.  As reported, the president said “he’s sorry Americans are losing [HCI] plans he said they could keep under his signature healthcare law,” but “stopped short of apologizing for making those promises in the first place.”  As for the path forward, in the president’s words, “we are going to do everything we can to deal with folks who find themselves in a tough position as a consequence of this.” (emphasis added) 

11/8/13, A11, Low sign-up rate grows more problems for ACA – This editorial surveys the accumulating problems with the GovCare rollout, including the fact that only four Delawareans have signed up for coverage so far according to AP reports.  And “even if the AP numbers were off 100-fold, the situation would be a disgrace.”  On the other hand, “probably far more than 400 Delawareans have been told their current insurance policies are being canceled.”  And on the national level, cancellation of HCI policies is in the millions.  Not to mention that workers with employer-sponsored HCI at many companies have already been hit with word that next year’s insurance coverage “will be much more costly.”  And don’t bet the ranch on the government making that Nov. 30 deadline to solve all the problems with the GovCare website.  Also, far from clear that young & healthy will sign up for HCI through the exchange so as to subsidize older/sicker customers.  So while the White House “keeps saying the current problems are only a setback,” it’s hard to see calling four sign-ups in a month “just a setback.” A candid summary of where things stand, although the question of what should be done differently is not addressed.

11/6/13, A10, Sequestration prevents a worst-case scenario, Stacie Beck & Eleanor Craig – Starts by saying “another debate over the sequester is coming soon,” with a backdrop of the $680B deficit in fiscal year 2013 – the first less than $1T deficit of the Obama administration but still “twice as large as that needed to stabilize the debt.” Much of the deficit improvement is attributed to a 14% increase in tax revenue fueled by rate increases, “but research shows that tax increases do not permanently reduce deficits, whereas they do harm the economy.”  To make permanent progress, spending cuts are needed.  Since 2000, spending has grown faster than the US population plus inflation.  Moreover, “federal money is poorly spent.”  Examples cited: “at least 44 job programs, 30 programs on invasive species and more than 100 programs promoting science, technology, engineering and math.” Fiscal Commission, 2010.  In fiscal year 2012, 79 anti-poverty programs resulted in “total welfare spending” of “$920 billion, about four times the amount needed to eliminate poverty.” Heritage Foundation, 10/27/13.  GovCare will raise federal healthcare outlays “unless care is reduced.” And Social Security and Medicare benefits paid to retirees will soar due to demographic trends in coming years.  “Before asking those to whom benefits have been promised to make sacrifices, it is reasonable to expect the federal government to do whatever it takes to reduce its costs, streamline its operations and reform its poverty programs to target [only] those who are truly needy.”  Sequestration may be a “blunt instrument,” but it’s better than doing nothing and Congress “has failed to propose [agree on?] a budget for years.” Continuing to “delay spending reform” could lead to “more government dependence . . . higher debt and eventually a budget crisis and more pain down the road for everyone.  This is the lesson of Greece; this is the lesson of Detroit. Sequestration prevents this worst-case scenario.  We must safeguard the health of our economy to better meet the needs of the future.” Seems like a generally sound column, but in our opinion: (A) Forget about reducing the deficit to a level that will “stabilize the debt,” it’s time to balance the budget. (B) No amount of spending will “eliminate poverty,” the issue is judging what needs deserve to be met.  (C) Sequestration may be better than nothing, but without more it will not “prevent” financial disaster.

11/6/13, updates re GovCare roll out (A) Official: Health[care] website still improving, Ricardo Alonso-Zaldivar & Alan Fram (AP): Per congressional testimony of Marilyn Tavenner, head of the CMMS, website users “can now successfully create an account and continue through the full application and enrollment process” and “we are now able to process nearly 17,000 registrants per hour.” Asked about legislation that has been introduced in the Senate to allow people to retain their existing coverage if they want to, the witness said she hadn’t read the legislation and took no position on it.  White House officials have also declined to comment on “similar bills introduced in both houses” of Congress.  (B) 29,000 residents may get subsidies; Kaiser says Delaware need lower than most, B1/B12, Beth Miller - Source: a national report of the Kaiser Family Foundation.  An estimated 48K Delawareans could decide to buy private healthcare insurance (HCI) policies on the exchange.  That excludes anyone who qualifies for Medicaid or Medicare.  Of the 48K, an estimated 29K would qualify for subsidies (that excludes people in higher income levels plus those who are “offered affordable plans by their employers”).  Delaware’s subsidy estimate – roughly 3% of the population – is among the lowest in the nation because the First State has expanded its Medicaid program eligibility from 100% to 138% of the federal poverty level ($15.9K for individual, $32.5K for family of 4).  Nationally, Kaiser estimates that 29M will sign up for HCI through the exchanges and about 17M will be eligible for subsidy.  Steve Groff, director of the state Division of Medicaid and Medical Assistance, is quoted that “it’s so important that people ask questions and get guidance” and “it is a somewhat daunting task to understand the differences in plans, cost-sharing, making sure you have your doctor in the network.”  Two examples are reported for estimated policy costs:

Prospective HCI customers (non-smokers), silver plan

Annual premium


Net cost

31-year-old making $16K per year




31-year old couple with 2 children, annual household income of $94K




Computer problems will be solved, of course, but remember that taxpayers are on the hook for those subsidies.  Also, these examples don’t provide a cost comparison with coverage that people previously had – in many cases there is a sharp hike (at least before subsidies).  And why should a couple with income of 399% of the federal poverty level qualify for a federal subsidy on their HCI?

11/5/13, A10, Should climate deniers be banned from writing?  John Sweeney – The LA Times has adopted such a policy, and Mr. Sweeney reports similar requests from “two people” that “were sent separately but sounded familiar.”  Also, “other editorial page editors around the country received similar requests.”  The rationale is that “untruths should not be published.”  However, says the writer, “I don’t believe in banning other people’s points of view, whether I agree with them or not.”  After all, they “have every right to disagree with me and I see my job as helping them to publish their views.”  The climate change alarmists are not the only offenders.  Someone “sent me the names of letter writers who should be banned from the paper because they are ‘socialists.’”  Also, “some of the most hateful mail I get comes whenever we publish a column by an economically conservative University of Delaware professor.” [Stacie Beck & Eleanor Craig?] Other analogous controversies are about gay rights and food crops changed by genetic engineering. Why should one expect people to bow to the supposedly scientific evidence when such issues are as much political as they are scientific?  “I often wonder . . . how many of those who hold one belief or another actually looked at any science at all.  I’m not talking about the actual scientists, but their followers.”  Fine by us if climate alarmist letters get published, the writers often undermine their own arguments by overstating them.  And we do pay attention to the science, albeit from a lay perspective.  Take a look at this report.  Global warming “pause” may last for 20 more years and Arctic sea ice has already started to recover, David Rose, Daily Mail (UK), 11/2/13.

11/5/13, A11, Republicans extend support for data center complex, GOP legislators (19 are named) – Column paints glowing picture of the proposed TDC venture at the UD Star Campus with only a passing reference to the “local opposition” that has materialized.  248 Megawatt natural gas-fired cogeneration power plant would make the data center energy independent with the local electrical grid used only as backup.  High efficiency – advanced emissions control technology will make this “one of the cleanest facilities of its kind in the US” – no significant noise problem (about 52 decibels at borders of the property, about the equivalent of a normal conversation) – produce lower cost energy for purchase by DEMEC (city of Newark’s power system) – construction of new $18M, 138-kilovolt substation “would improve the flexibility of the local grid at no cost to taxpayers” – jobs (5,000 construction workers, 300+ on ongoing basis) – millions of dollars in new tax revenue.  Conclusion: “We need to embrace this project, not only for the benefits it will produce for the Newark area, but the promise it offers for a better tomorrow for all Delawareans.” Complements the governor’s column (just below), nice to see bipartisan support developing for this project.   

11/3/13, A29, Let’s create jobs here, not send them away, Governor Jack Markell – The basic thrust of this column is that the First State should keep the welcome mat out for new business ventures.  And the writer has several situations in mind: (1) Activists who have raised “unprecedented legal arguments that threaten to shut down some existing operations of the Delaware City refinery.”  (2) Millsboro residents who have “argued against the creation of 700 jobs and a $100 million investment at a closed pickle plant.” (3) The proposed Newark data center, where according to Rep. John Kowalko, some of the Newark residents opposed to the project “want jobs, just not those jobs near their neighborhood.”  Naturally, business ventures must meet “air, water, safety and noise requirements,” and the standards should be both rigorous and set with public input.  But opposition should be “based on facts, not rumors [or bizarre ideological agendas],” and “if the project meets the standards we set, it should move forward.”  To be successful as a state, we must “come together and say ‘yes’ when good opportunities arise.  We have disagreed with the governor on many things, and may well do so in the future, but in this instance he is on target.  

11/3/13, E1, Average Bloom Energy surcharge drops in Dec., Aaaron Nathans – The reduction in the surcharge for an average residential customer will be from $4.37 in November to $4.05 in December.  However, the aggregate surcharge increased from $2.79M to $2.89M so this per customer reduction is apparently caused by a “changing number of Delmarva customer by which to divide the amount due.”  The power output from the two fuel cell generation plants is projected to reach 26.3 megawatts in December; it will eventually reach the 30-megawatt capacity

11/2/13, A8, Perhaps Congress will muddle through to a solution – The editors seem convinced that the budget conference committee will not accomplish anything and another “countdown for catastrophe will begin just after Christmas.”  Senator Chris Coons of Delaware is quoted that “economic growth has to be our North Star,” while Republicans say they are “looking for reform of the tax code” or something.  Seems like there could be a bargain there, but don’t count on it.  Probably “the best we can hope for is a deal that avoids another, deeper sequester” and “more muddling through.”

11/2/13, B1/B2, Markell joins US climate panel; Obama appoints state, local, tribal task force, Molly Murray – Governor Jack Markell is one of 8 governors appointed to serve on a climate change preparedness and resiliency task force.  He is quoted that low-lying Delaware knows all about these subjects, and should make a great contribution. The panel is expected to meet four times, starting in December, and submit recommendations to the president within a year.  Senator Tom Carper is quoted as being pleased the panel will move beyond treating symptoms (extreme weather) to start treating the underlying disease (global warming?). Per section 7 of the president’s executive order, the panel is tasked to address three points:  (i) remove barriers, create incentives, and otherwise modernize Federal programs to encourage investments, practices, and partnerships that facilitate increased resilience to climate impacts, including those associated with extreme weather; (ii) provide useful climate preparedness tools and actionable information for States, local communities, and tribes, including through interagency collaboration as described in section 6 of this order; and (iii) otherwise support State, local, and tribal preparedness for and resilience to climate change. Sounds like a big waste of time!

11/1/13, GovCare rollout – The News Journal reports problems with GovCare going beyond the website fiasco, namely (1) policy cancellation letters that are leaving some healthcare insurance (HCI) customers in the lurch (“For some, policies vanishing; Marketplace glitches add to desperation,” A1/A9, Beth Miller); and (2) President’s dubious promise about keeping HCI policy you like (“Insurance assurance was flawed from start,” A9, Calvin Woodward, AP). A stray comment on the editorial page (“Don’t blame machines; we are the ones at fault, A13) suggests the NJ is still not placing the blame where it belongs.  Re failure of the website to enroll customers, “politics stopped a true test of this technology” so “now healthcare insurance reform is foundering.” Compare “The website is fixable, but GovCare has deeper problems,”  11/4/13

11/1/13, A12, more commentary re proposed Newark data center(A) Will data center end up hurting Newark?  Amy Roe, a candidate for mayor of Newark – The writer’s views have been published repeatedly, e.g., on 8/9/13. She now claims credit for sparking public debate about the proposal and says new information has come out that suggests “additional questions.”  Sample: “Is the electricity contract and zoning on the property legally binding if critical information was withheld from elected officials?” (B) Data center will help Newark now and in the future, Ken Grant (Newark resident) – Mr. Grant characterizes the data center as “a job-generating, public-enhancing, environmentally sound project that makes sense for our community.”  He also rebuts arguments that “we don’t need any more jobs . . . this is all a conspiracy to sell electricity to the power company . . . this will destroy the environment and lead to a giant cloud over Newark.”  Accordingly, “I look forward to the day in which Newark is seen as the most desirable place for world-class companies and innovative entrepreneurs to collaborate, dream and create.” (C) Bloom boxes should be used at data center, A13, James Donovan, New Castle – Instead of building a power plant for the data center, the writer suggests, why couldn’t this facility use backup power produced by Bloom Energy fuel cells?  “This would dramatically reduce the amount of pollution produced [not really], eliminate the need for a natural gas pipeline through the wild and scenic White Clay Creek, and provide some business for the heavily subsidized Bloom company.” Ms. Roe’s relentless attacks seem inappropriate; we are reminded of the antics of opponents of a new Wawa in Newark that contributed to Mayor Funk’s decision to resign.   Mr. Grant goes too far in the other direction. Government officials and the public should review proposed investments soberly and clear them absent convincing concerns that need to be addressed (such as unjustifiable demands for subsidies). Mr. Donovan seems to overlook the fact that the data center owner wants to make a profit and no one is likely to propose any more taxpayer or ratepayers\ subsidies for Bloom fuel cells right now.

11/1/13, PBF to boost oil-by-rail; Refiner plans 20% hike in US shipments, Jeff Montgomery – PBF is planning a $10M project to increase the Delaware City refinery’s offloading capacity for Midwestern oil delivered by rail to 205K barrels a day, which is “nearly double the amount forecast when PBF first announced its embracing of rail early last year.”  Among other points in the business plan, the company will buy new and more secure tank cars to supplement or replace an existing fleet “that may be outlawed.” The most recent quarter produced a loss, and y-t-d adjusted earnings for the company of $71 M compare to $327 M in the first nine months of 2012.  Re environmental challenges, Delaware Audubon and the Sierra Club Delaware chapter have appealed a CZIB denial of their complaint under the Coastal Zone Act to Superior Court, with a separate Environmental Appeal Board proceeding also underway. 

10/31/13, Kickoff meeting of budget conference committee airs range of views(A) Congress begins discussing budget issues, Andrew Taylor (AP): Gist of story is that the BCC session was about easing the effect of sequestration, thereby “easing indiscriminate spending cuts slamming the Pentagon and domestic agencies alike.” A “grand bargain” is described as off the table.  It seems that one of the “most difficult roadblocks” to progress is taxes, which is illustrated by reference to opening statements by co-chairs Rep. Paul Ryan & Senator Patty Murray.  And “if Republicans won’t allow new revenues to be used to offset additional defense spending,” there may be cutbacks in “the Pentagon’s popular Tricare healthcare program and its generous pension benefits.”  This report is OK as far as it goes, but leaves out a lot.  First, what happened at the meeting is that each of the 29 BCC members made a 5-minute opening statement, it was announced that the next meeting will be on Nov. 13 at 10:00 AM (in meantime, House will recess for the next two weeks), and after brief remarks by Ryan/Murray the meeting was adjourned.  Calling such a proceeding a “discussion” is a stretch, and one wonders how a 29-member group (22 senators!) can be expected to accomplish much of anything. (B) Budget resolve [sic] requires compromise, communication, A10, Senator Tom Carper – After once again blaming the shutdown on Republicans, Senator Carper expresses the hope that “something positive” can come from it.  The two budgets should have been reconciled six months ago, he says, to produce “a compromise budget resolution.”  After all, the two budgets did the same thing (“provided a road map for continuing to reduce our nation’s budget deficit over the next 10 years”) albeit “in very different ways.”  So now that a bipartisan, bicameral conference committee has been created – including Delaware’s own Senator Chris Coons – there will finally be an opportunity to make things right.  BCC members need to do four things: (1) Reform tax code and use only part of proceeds to reduce corporate tax rate, thereby raising taxes. (2) Reform entitlement programs in a way that will “avoid savaging the elderly and poor.”  (3) New investments in infrastructure and support for R&D programs, thereby boosting spending.  (4) “Search unrelentingly throughout the federal government for ways to get better results for less money, in part by finding out what works and doing more of that.”  Compare SAFE’s plan, which we think is closer to the mark than this collection of platitudes.  Let’s make a deal: some thoughts for the budget conference committee, 10/28/13.

10/31/13, A3, Sebelius apologizes for botched health[care] website, Kelly Kennedy & Catalina Carnia (USA Today); President “not happy” with site problems – The implication of these stories is that the only problem with the GovCare rollout is a malfunctioning website that is supposed to be fixed by Nov. 30.  HHS Secretary Kathleen Sebelius is quoted as saying “hold me accountable for the debacle,” and the president, speaking in Massachusetts, declared himself “not happy” with the healthcare insurance enrollment problems and took “full responsibility” for resolving the computer problems.  Left out: a blizzard of cancellation of existing healthcare insurance (HCI) policies has called into question the president’s 2010 promise that people who liked their existing HCI coverage could keep it – “period”.  This issue was raised in the hearing at which Sebelius testified, and she didn’t have a very good answer for it because there is no very good answer.    

10/30/13, A1/A9, Woes move beyond website; Carriers may drop millions of insured, Ricardo Alonso-Zaldivar & Stephen Ohlemacher (AP) – “Move over website woes.  Lawmakers confronted the Obama administration Tuesday with a difficult new healthcare problem – a wave of cancellation notices hitting individuals and small businesses who buy their own insurance.”  According to Marilyn Tavenner, head of the CMMS, this is really the doing of the insurance companies – not the administration – and the people getting cancellation notices “will be able to find better replacement plans, in some cases for less [after deducting subsidies].”  However, the cancellations “could become another public relations debacle for” GovCare, as “this problems goes to the credibility of one of the president’s earliest promises about the healthcare overhaul: You can keep your plan if you like it.”  The problems with the GovCare rollout have apparently gotten too big for the mainstream media to keep ignoring them, even though this one is only described as a “public relations debacle.”

10/29/13, A10, Time for Washington to refocus on manufacturing, Sen. Chris Coons – “It’s time that Washington refocuses on manufacturing jobs instead of manufactured crises.”  Senator Coons is one of a 22-senator group starting “Manufacturing Jobs for America,” an effort intended to “translate good ideas into good manufacturing jobs across the country.”  More than 40 measures have been identified – many with bipartisan support.  Fight unfair trade practices resulting in “subsidized cheap imports” and currency manipulation – modernize US infrastructure that will result in more sales of steel plates, etc. – Bloom Energy venture to “produce cleaner, sustainable energy for our power grid and businesses – Delaware’s Manufacturing Extension Partnership, a government-funded nonprofit that lines up experts to assist managers and workers streamline their processes, better manage their inventories, etc. – upgrade schools to turn out more of the workers with skills needed for modern manufacturing operations – make it easier for startup manufacturers to access capital and invest in R&D – national manufacturing strategy to prioritize the creation of manufacturing jobs. We do not agree that free enterprise cannot function without government support at every step, and many government activities get in the way (a possibility not mentioned in the column).  The Bloom Energy venture is a particularly poor example to cite, since it’s a classic example of crony capitalism in action.

10/29/13, A1/A6, Sandy one year later: Insurance costs rising, around 46,000 properties could be impacted by map changes, Jeff Montgomery & Molly Murray – Changes to the federal government’s National Flood Insurance Program maps could mean higher insurance premiums for many of the estimated 46,000 Delaware properties [Sussex County 30K, Kent County 7K, New Castle County 8K] affected.  The maps also affect landowner rights on building new dwellings or rebuilding storm-damaged homes, not to mention the marketability of their properties.  Eliminating flood insurance subsidies could bring 10-fold increases in older homeowner insurance policies, which would be “on top of the expense rung up by flood map updates made by [FEMA].” More land near tidal waters will be classified as the highest-hazard “V,” or velocity zones, where damaging, 3-foot or higher waves come with a 1-in-100 chance storm.  That will now include all of New Castle County’s Delaware River shoreline and more settled areas east of Milford and west along inland bay tributaries.  According to Paul Sarnak of the Delmarva Insurance Group, few customers seek coverage beyond the $250K FEMA limit for homes and $100K cap for contents.  Homeowners with a mortgage are required by lenders to purchase coverage, although many people are reportedly raising their deductibles.  Lower rates may be available for elevated properties, providing an incentive to build homes on pilings. 

10/28/13, A16, Curtail US flood-insurance subsidies – This editorial suggests that waterfront property owners should not count on the continuation of “cheap” federal flood insurance. “The program has been so good to some people that they have been able to get payment for structures that have been flooded 15 or more times.  That doesn’t make sense.”  So a 2012 law, the Biggert-Waters Act, took away many of the subsidies and “FEMA is now in the process of reconfiguring maps according to facts and not someone’s imagination and then passing the bad news along to homeowners.  Insurance rates, naturally, are going up.  The formerly subsidized are crying that this is unfair.”  Although the law isn’t perfect, of course, “it will change the vacation home-welfare attitude that has been running up governmental costs for decades.”  Two thoughts: (1) Let’s hope the maps are not being reconfigured based on exaggerated projections of sea level rise; that’s not what we would consider “facts.”  (2) The best solution would not be to attempt to reform the federal program, it would be to get the federal government out of the flood insurance business entirely and allow the private insurance market (with choice and competition) to manage the rates that are quoted.

10/28/13, some sentiment surfaces in favor of the proposed Newark data centerHarry Themal (Balancing jobs, the environment and our politics, A16) says “the governor should warn more forcefully the opposition [to the data center] that it threatens to give Delaware an even worse reputation as a welcoming state.”  State Senator Robert Venables (D-Laurel) (It’s time to find a path forward, then work together, A17) says “we need to recognize promising opportunities, such as the data center at UD’s STAR campus, when they come our way, rather than decrying their lack of perfection.” 

10/26/13, reflections on civic input to investment proposals – Two News Journal columns (on A9) draw an interesting contrast between the ways in which two investment proposals (the two facilities involved will stand side by side on the STAR Campus in Newark) were “sold” in Delaware.  One was rushed through with essentially no consideration of public opinion, creating a long-term financial burden for Delawareans that cannot be undone.  The other is being second-guessed unmercifully despite its clear-cut economic merit.  (A) Bending rules for a risky startup put us in this spot, David Stevenson, Caesar Rodney Institute – The writer relates “how rules were bent for a risky startup business that promised a lot of jobs in return for a very large financial guarantee.”  As an intervener in the Public Service Commission (PSC) approval process, he got to see all the documents, submit testimony and cross-examine witnesses in a public setting.  He relates unique and rushed legislative/regulatory approval of a proposal to treat the Bloom Energy fuel cells as a renewable resource, justify a tariff payable by Delmarva Power customers, and accept estimates of what the tariff would cost over the next 20 years without adequate review of their accuracy.  “Minor adjustments were made [during the PSC review] that brought the expected cost to $1.34 a month [on the average customer] and cut the [estimated] economic benefits in half but the legislative rules were met and the PSC commissioners passed the tariff.”  Now it has become evident that “the cost [will] be closer to $4.50, way above the $2.40 cap,” and “we see little relief for electric [power] customers in future years.” Let’s be sure to avoid this type of “sweetheart deal” in the future.  We would add that while CRI was the only critic of the project who acted as an intervenor, there was a tidal wave of public comments against the proposed tariff that the PSC commissioners saw fit to ignore because they knew the administration wanted to get it approved ASAP.  Clearly, public opinion can be right at times and we would certainly not support a “leave it to the experts” principle for subsidized investment proposals like this one.  (B) Newark residents not against gaining new jobs, Rep. John Kowalko – This column reacts to a recent editorial titled “Sluggish economy in need of better cooperation.” We don’t recall the editorial, but Living in a world of “shifting winds and currents,” John Sweeney, 10/15/13, is written in a similar vein.  Rep. Kowalko contends that the editorial board went overboard in implying that concerns of Newark residents re the power plant proposal [an integral element of the $1 billion data center proposal] for the STAR campus are “damaging the state’s reputation as an attractive place to bring business.”  He slams the attempt “to define the authenticity of the proposal as harmless to residents’ concerns while failing to enunciate many of the key circumstances and communications failures that have contributed to this controversy” – implication that the “protests against this proposal and seemingly every other job-creation proposal that has come along in recent months” is to blame for a sluggish economic recovery – “woeful lack of dialogue with inclusion of the community in the planning of this project” – short shrift given to the rights and concerns of the residents. Newark residents are “not saying no to jobs,” says Kowalko, they are simply expressing “skepticism as to the accuracy of the projections that the Data Center has made.”  These “job creating” propositions have been developed and agreed to without the inclusion and knowledge of the community, which suggests “a pervasive attitude of indifference and disregard for the rights and opinions of taxpayers and a dismissive tone to regarding allowing them to engage in the conversation.” As far as we are concerned, the Data Center/power plant project has received more than enough attention.  There have been at least two large and vocal public hearings on the project, and the objections that have been raised lack substantive merit.  No significant taxpayer subsidies are involved, the environmental effects should be relatively benign (certainly less damaging than those of the Chrysler assembly plant that previously operated at the STAR Campus site), and the jobs created, taxes paid, and surplus power generated will directly benefit the Newark area as well as the state as a whole.  Furthermore, it’s ironic that Rep. Kowalko declined to ask questions about the Bloom Energy venture, let alone vote against it, when he had the opportunity.

10/22/13, A1/A2, From futility to fame: For Delaware’s first successful Affordable Care Act enrollee, hours of frustration lead to day at White house, Kelly Bothum – Large picture of Janice Baker walking outside the White with the president; she introduced him at “media event” in the Rose Garden. Baker was among “a select group of small business owners, students and others invited to the White House . . . to highlight those who have had success getting health[care] insurance as a result of [GovCare].” However, no official figures have been released as to how many people have enrolled via the exchanges and the administration is reportedly not planning to release such data until mid-November.  At the event, the president acknowledged problems with the website but promised the problems will be fixed, urged applicants to remain patient, and said everyone who wants to buy insurance through the exchanges will have that opportunity. This report goes on to reprise how Baker succeeded in enrolling for insurance on the GovCare exchange in Delaware, as previously reported on 10/16/13And here’s a rundown on the select group from the Washington Examiner.  Sounds like these “success stories” are not exactly typical.  Another report suggests most people signing up for healthcare insurance on line are participants in expanded Medicaid programs in some states versus customers for private insurance plans. “According to the latest data from Washington, 24,949 people have successfully enrolled in insurance through the Obamacare exchange. But of those, just 3,084 actually finished enrolling in privately-administered health care plans. The balance of individuals -- 88 percent -- enrolled in Medicaid.”

10/22/13, A1/A10, Coons hopeful panel can find answers; Committee has until Dec. 13 to reach budget deal, Nicole Gaudiano & Ledyard King – “I’m choosing optimism,” Coons is quoted re the budget conference committee that is charged with reconciling the House and Senate budgets, or “maybe ‘hope’ is a better word, because hope is the triumph of faith over experience.  The last three weeks were pretty dispiriting.”  According to this story, “Republicans and Democrats agree that automatic federal spending cuts now in place are bad for the country, but they don’t agree on much else.” Coons’s suggestion for progress is that “everything has to be on the table,” which apparently means there will be no chance for the deal unless Republicans agree to revenue (aka tax) increases.  They don’t necessarily have to agree to tax rate increases, it might be sufficient to close loopholes and thereby not only raise revenue but “make the country more competitive” (not a direct quote). If the goal was raising revenue, that would be the kiss of death for real tax reform.  Better to have continued deadlock.   Coons is not sure how the working assignments will be parceled out, but “said his priorities include protecting money for Amtrak and promoting investments in infrastructure and research and development.” In other words, he wants to support more spending?

10/22/13, B1/B2, GOP leaders, Markell open to economic meeting, Jonathan Starkey – Republican legislative leaders have written the governor to propose a meeting to discuss ways to jumpstart Delaware’s economy and the governor has responded that “I would be happy to sit down with you.”  As for the agenda, this article suggests that the prime issue might be reviving talk (in the closing days of the last legislation session) of new infrastructure investment (which would be popular) financed by tax increases (which the Democrats declined to push through without GOP support).  “Tax and spend” is no solution.  It’s time to take a serious look at chopping some nonproductive government programs, cutting back on regulatory bloat, ditching the renewable energy portfolio, etc.

10/22/13, B1/B2, AG files appeal in Fla.; Biden fights changes by A.I. du Pont Trust, Sean O’Sullivan – Having lost in a lower Florida court on one of its legal challenges (7/3/13), Delaware Attorney General Beau Biden is appealing the decision.  And no surprise, because he and his office look good for fighting for the children in Delaware.  But the trustee has a point in observing that this seemingly endless litigation between Delaware and the A.I. du Pont trust in Florida is eating up resources of the trust that could otherwise be used to meet the healthcare needs of more children (regardless of where they are located).  Note: the agreement that at least half of the trust’s expenditures will be in Delaware has been honored – and to us, this seems like a fair resolution of the competing interests.  No matter, the legal war will probably continue.  “Since 1971, there have been 13 lawsuits between Delaware and the Florida-based trust with 19 appeals to Florida appellate courts and nine additional appeals to the Florida Supreme Court.”   

10/20/13, A1/A6, Bloom’s Sridhar shares his vision, Aaron Nathans – Bloom’s CEO (small photo on front page, big picture on A6 standing in front of Bloom facility) participated in an hour-long interview with the News Journal at the new Bloom factory in Newark.  According to KR Sridhar, the future is “power flowing to every corner of the globe, no matter how far someone lives from the electrical grid” and the path to that future “runs right through Delaware, where Bloom’s fuel cell servers will be manufactured for shipment not just along the East Coast, but around the world.”  And someone is obviously listening, since the company has attracted some $1.1B in venture capital funding and installed its “Bloom Boxes” at the likes of Google, AT&T and Coca-Cola.  Most of the customers thus far have been in “subsidy-rich California,” but Bloom has attracted more customers in this region, like JPMorgan Chase, which plans to put Bloom Boxes on its Delaware campuses.  “Can you imagine a more blue-chip list of customers,” Gov. Markell gushed at the previously reported opening event on Wednesday.  And not only is the state “giving Bloom $16.5 million in direct incentives,” but Delaware power customers “could pay hundreds of millions in a fluid [running far above forecast, but calculated in a fixed manner with no way out] surcharge over the life of the 21-year deal.”  So far the factory has hired about 80 people, and the company reportedly plans to hire about 100 more in coming months.  Reaching the 900 jobs “the state expects to be created at the factory by 2016” will be contingent on selling Bloom servers in other locations, e.g., initial sales in Japan until enough demand has been created to justify building a factory there. Why wouldn’t servers for Japan be made in California or India?  Among the advantages attributed to Bloom servers: (1) Avoids the expenses of hooking up to the grid, which can supposedly be very expensive for, say, “data centers in cities throughout the world.” (2) Distributed system provides protection against power interruptions in the grid.  Bloom has supposedly analyzed 50 years of data that show “a 99.7 percent chance of a major power outage on the East Coast – with duration of 5.1 days and more widespread than Hurricane Sandy – within a five-year period.”  (3) US electric grid is old and strained; cost of updating it would be too high. (4) In developing countries, the grid does not go everywhere, and even where it does go the population is growing so fast the grid can’t be expanded fast enough to meet demand.  (5) Fuel cells produce fewer emissions than conventional natural gas generation plants.  However, “we took no position on climate change, global warming, any of those things.  We are a data-centric company.”  To be complete, “there remain some questions in the trade press about whether Bloom can fulfill Sridhar’s vision.”  Thus, Chelsea Sexton (California-based blogger and alternative fuels advocate) says “fuel cells in general are still very, very nascent.”  Last year, one of Bloom’s fundraisers, Advanced Equities, agreed to settle SEC charges that it misled investors when raising money for Bloom in 2009.  And Kleiner Perkins has had high profile failures such as Fisker Automotive.  However, “these issues seemed distant from Delaware on Wednesday, when local officials hailed the new factory as a milestone for local economic development” and UD President Patrick Harker called fuel cells “an industry that can power us to prosperity.”  If Bloom’s fuel cells have economic advantages over the centralized power grid, then customers will presumably buy them and that’s fine.  But so far, Bloom has relied on government handouts at every turn – and we have a hunch this won’t change.  It’s interesting that the data center proposed to go in right next to the Bloom factory wants to build a combined cycle natural gas power plant instead of buying Bloom boxes.

10/20/13, A29, Congress needs more who know how to follow, Ted Kaufman –The president could not negotiate with Speaker Boehner since the latter could not deliver the votes in his caucus for a deal and insisted “until the very last minute” that he would honor the Hastert rule (never bring a bill to the floor unless a majority of the Republican caucus supports it) – “President Obama will justifiably get credit for his refusal to negotiate” as
“he had no one to negotiate with” – newbies like Senator Ted Cruz should become better followers (forget leadership) so the leaders in Congress can “return to the politics of compromise and negotiation as it was always practiced in Washington.” We are not convinced that the country will be better off if Republicans revert to the “go along to get along” pattern they have often followed in the past – which is basically what former Senator Kaufman seems to be advocating.  The government shutdown ends, with unresolved issues aplenty,10/21/13

10/19/13, A6, Del.-based boss goes undercover, Buffets Inc. CEO gets new perspective as part of reality TV show, Angelia Davis (Greenville, SC news) – Buffets Inc. CEO Anthony Wedo went undercover as “a left-over 70s rocker” to get a different look inside his restaurants.  Pictures of Wedo in a business suit, and with a blonde wig, bare arms, and an outlandish outfit.  Wedo is a 54 year-old business executive, whose experience was televised for the CBS series “Undercover Boss” and aired on the evening of 10/18. He became CEO of Buffets, Inc. (343 restaurants in 35 states, principally Country Buffet, HomeTown Buffet & Ryan’s) in December and is working to turn around the operation.  As a result of going “undercover,” Wedo was able to see what goes on in the restaurants at the worker level including stints as a dishwasher, grill cook, cashier and server.  He came out of the experience with a raft of ideas for improving operations, including investing over $3 million for new point of sale registers in all of the restaurants after he found out that the existing system was “incredibly difficult” to operate.  He also gained a new appreciation for the challenges faced by many employees, who work very hard despite major challenges in their personal lives.  “This experience embodied something I believe in deeply, Wedo is quoted, “that I am compelled to help those with many worries but few complaints.”  In the follow-up sessions with the various employees, Wedo revealed his true identity and awarded each of them with gifts designed to make their lives easier and more fulfilling. Wedo is a Delaware resident and lives in Greenville (Delaware, not South Carolina.) Nice to see this coverage; it’s a relative rarity in the newspaper to see a genuinely “feel good” story about a successful businessperson. 

10/19/13, B1/B2, Carper urges cooler heads; says slash-and-burn tactics offend public, James Fisher – Senator Carper criticizes Senator Ted Cruz for not being very good at “collaborating or compromising.”  Well, “Carper’s ding” was kinder than other comments this week, including Senate Majority Leader Harry Reid calling Cruz “a laughingstock.”  And Carper expressed the hope that “Cruz would eventually be a senator in the mold of Tom Coburn . . . who has surprised some with calls to limit defense spending and joined Democrats in supporting expanded background checks for gun buyers.”  According to Carper, he tried to “befriend” Cruz after the latter was elected to the Senate, knowing that “he was a tea party guy, way out on the right wing.”  And looking ahead to the budget conference negotiations, Carper spoke of “a lot of unhappiness with the performance of Washington on both sides.  Especially the Republicans, to be honest. [So] this is a chance for us, not to make amends, but a chance for us to do our job.”  In contrast to critics of the president et al., such as Dan Weber, president of the “right-leaning Association of Mature American Citizens,” Carper said that “in some congressional districts and maybe some states, [congressional Republicans] get rewarded” for “liberally obstructing, by creating mischief and problems.” These comments seem rather patronizing, and they also devalue principled opposition.  Would Senator Carper contend that GovCare is going well, when even people on the Left are beginning to admit the roll out has been botched?  The case for optimism, Charles Cooke, National Review, 10/18/13. . . . even the law’s fiercest advocates have been impressed into conceding that the rollout has been a disgrace. The Washington Post’s Ezra Klein, Obama cheerleader par excellence, has characterized the launch as a “disaster.” Former White House press secretary Robert Gibbs has argued on television that the episode has been “excruciatingly embarrassing.” Mother Jones’s Kevin Drum, meanwhile, has echoed the growing fear that the issues will be with us for the long haul. “The bugs,” he wrote this week, “seem deep and profound.”

10/19/13, A8, Professor misstates Obamacare effects, Jamie Moulthrop (Newark) – Letter writer takes aim at “Obamacare needs to be strengthened, not defunded” column by UD economist Saul Hoffman, 10/16/13.  Hoffman “uses his credentials as an economics professor at the University of Delaware to mask his partisan hackery.”  His column was “full of half-truths that would make me think twice about the quality of an economics education at [UD].”  States who declined to expand Medicaid coverage were well aware that they would likely have to bear much of the cost down the road.  Why should we encourage young people to sign up for healthcare coverage when they will be taxed if they don’t? And not “an iota of evidence” provided to support charge that Republicans are encouraging people not to sign up.

10/18/13, News Journal coverage and commentary re the fiscal path forward illogically elevates politics over policy - (A) Underlying issues move center stage, A1/A5, Andrew Taylor (AP) - “The American people are fed up with Washington,” the president said, “in stern remarks at the White House.”  And he reportedly “warned lawmakers about disagreements so bitter they could ‘degenerate into hatred’ and urged a shift toward cooperation.”  Wouldn’t it be nice if Congress would “come up with a long-term agreement for restraining Medicare and Social Security spending” and “pass immigration and farm and food bills that have floundered amid partisan disputes.”  However “the small group of lawmakers tasked with steering Congress out of three years of budget stalemates and standoffs offered no promises.”  The article goes on to announce that the president et al. “were the decisive victors in the [budget] fight,” and blame the outcome on tea party Republicans who “prevailed upon skeptical GOP leaders to use a normally routine short-term funding bill in an attempt to ‘defund’ the 2010 healthcare law.” This demand was quickly replaced by lesser demands, including a one-year delay in GovCare.  (B) Twin editorials on A12: “A computer disaster is no call for celebration” and “Congress: Stop wasting time and settle budget” – It seems that the flawed rollout of the GovCare enrollment is more than “a glitch,” it is “a huge failure,” which “brings into question the entire program.”  Federal officials “repeatedly assured the public all was well,” but “we know differently now.” After months of dismissing all criticism, is the NJ admitting the critics were right and GovCare should have been delayed to address the problems?  The second editorial slams Republicans who “have earned the heated resentment from voters for allowing party extremists to salivate at earning patriotic credibility for forcing thousands of federal workers off work while they dangled the threat of defaulting on our national debt as a holy rite of proper fiscal management” [kind of a mouthful], but still “Democrats haven’t earned a steady moral high ground entirely” and also have “ideologues responsible for an abysmal failure to negotiate early on and in earnest over the critical funding and taxation issues that determine the security of the country’s future.”  Let’s see, wasn’t it the president who said he would not negotiate on either the funding resolution or the debt limit?  (C) Taking stock of the damage of government shutdown, A13, Samuel Hoff, Delaware State – Not only will the government shutdown foster “more cynicism about Washington,” the writer suggests, but “the consequence will most likely be felt in less participation in the political process, including voting.”  He also laments structural changes such as the 22nd Amendment limiting presidents to two terms, “campaign finance revisions that have significantly elevated the influence of wealthy interest groups,” and a “decline in political leadership resources,” which means “the present deadlock trajectory of American politics might continue unless divided party control of Congress ends.”  Therefore, “the Republicans have exactly one year to fix their brand.”  The idea that the president might be in the wrong is seemingly too absurd to contemplate. (D) Democrats should surrender on taxes, focus on growth, A13, Ezra Klein (Bloomberg) – There may be some hope for the budget conference committee negotiations now getting started if Democrats will “admit the obvious,” namely they have “lost on taxes” for the time being and need to “smartly negotiate the terms of their surrender.”  Dems miscalculated in 2011, because old guard has lost control of GOP and the newbies were OK with sequestration even if it would force big cuts in the defense budget.  After all, it locked in $1.2 trillion in spending cuts without a dime in new tax revenue.  The Republican refusal to raise taxes has “nothing to do with policy, it’s identity.”  So in exchange for agreeing to entitlement cuts, Dems should push for “immigration reform and infrastructure investment,” which supposedly would foster “growth”.  The immigration bill passed by the Senate is a nonstarter; it would do little if anything to stop illegal immigration, which is socially corrosive and economically unnecessary.   

10/17/13, B1/B2, Generation gap in polling, Nichole Dobo – Photo: Head and shoulders of John Zogby speaking at Wilmington University yesterday, with a wall of poster logos behind him.  Punch line: “Young people want gridlock to end.”  Millennials reportedly want to break through gridlock in government and the workplace, “but the baby boomers must give them the power to do it.”  The payoff would be to “harness the [Millennials’] ability to solve problems.”  And look, the partial government shutdown “is the latest sign that the old way of doing things no longer works” and “we are watching familiar organizations crumble right before our eyes.”  Zogby’s profile of Millennials: more globally minded and less attached to a top-down decision making process than the Americans who came before them, passionate about public service, pragmatic and concentric [?], contrary to some critics not apathetic and narcissistic, do not subscribe to “ideology that has driven much of the political conversation within the Republican and Democratic parties.”  For more, see Zogby’s book: “The First Globals.” (, it’s all of 79 pages).  In Q&A period, Zogby praised VP Joe Biden as “a viable contender for presidency” (not a has been by 2016?), likes NJ Governor Chris Christy’s governance model but says it lacks broad support within the Republican Party (which “is in such disarray”), mocked tea party for nominating Christine O’Donnell who is “into witchcraft.”  For better or worse, the Millennials will run the country in due course – but the ideas attributed to them by Zogby seem naïve and sterile.  Principles matter, not just getting along – and they always will. 

10/17/13, A13, Another “win” that kicks problems down the road, editorial – The crisis is not over, it has simply been postponed until after Christmas.  Republicans are glum.  Democrats are happy.  Both are wrong, because “we still don’t know how to pass a budget . . . intelligently cut waste, determine priorities and discipline our spending habits . . . avoid government by crisis.”  The Republicans “job really is to be the loyal opposition” who forces the majority “to justify their actions and [limit] the push of government.”  The “tea party acolytes” forced “members of their own party to forgo genuine compromises that would have moved the government closer to more realistic goals” rather than forcing “Democrats into cutting back their demands for an expansion of government.”  What did we learn from this experience: “The shutdown really didn’t shut down much.”  And worse, “millions of people around the world are losing confidence in the United States” due to “the real talent Congress has for kicking things down the road.”  As for “the conference committees that will gather over the next several weeks,” they “really won’t come up with solutions” but “will merely keep people busy until the next deadline approaches.”  Not only is the description of the Republicans’ “job” patronizing, basically say your piece and sit down, but it is also unrealistic; without recurring fiscal deadlines, the GOP would have zero leverage. How odd that the editors fail to say what the “job” of the Democrats is.  Finally, no good purpose is served by assuming that the budget conference committee will accomplish nothing before it is even established.  Start by assuming failure and that is what one will get.

10/17/13, A1/A2, High-tech hopes at Bloom [Energy] plant unveiling; Fuel cell server provider has deals in place with JP Morgan, Wal-Mart, Aaron Nathans – Bloom’s Delaware factory was formally opened on Wednesday “with company and state leaders hailing it as a starting point for the next generation of manufacturing in a state that lost its share of old-school factories.”  Pictures: KR Sridhar, CEO of Bloom Energy, speaking to officials and employees; Bill McHenry of JP Morgan Chase signs a fuel cell server; “fuel cell servers made by Bloom Energy in Newark sit outside the manufacturing facility on Wednesday” [they are actually inside a large building that appears to contain little else except some pipes]; Mr. Sridhar sitting next to Gov. Jack Markell, facing camera, apparently engaged in conversation with him. In his remarks, Sridhar contrasted the Bloom plant to plants making cars and steel that “are going away” and will not be “coming back.”  For his part, Gov. Markell lauded the Bloom plant as “an opportunity to build a new face of manufacturing right here in Delaware.”  During the event, a JPMorgan Chase official announced plans to “place Bloom’s servers at one or more of its Delaware facilities,” and Wal-Mart announced that “it would install Bloom’s servers somewhere along the East Coast.”  Previously, according to the story, “only Delmarva had publicly announced its intention to use Bloom Boxes in Delaware.”  Also, “several projects have been announced in Connecticut, as well as one in North Carolina at an Apple data center.”  The Delmarva generation facility is being heavily subsidized.  No subsidies are mentioned for the other users, but we doubt the use of Bloom servers will prove economic without them

10/16/13, A12, Obamacare needs to be strengthened, not defunded, Saul Hoffman (UD economist)Professor Hoffman has written repeatedly about GovCare, most recently on 9/14/13. His theme in this column is that the legislation “needs to be strengthened, better understood and defended against the onslaught of Republican misrepresentations.” Strengthened – since the “near poor” (family income up to 4/3 of the official government poverty level) were supposed to be able to participate in Medicaid, but some states with Republican governors are refusing to expand their Medicaid programs even though the federal government was promising to cover (initially) almost all of the cost involved, the president should insist – in upcoming budget talks – that the current premium subsidies now available to low and moderate income families “also be made available to near-poor families whose states have denied them the Medicaid expansion benefits that were intended for them.”  Understanding – Dead wrong to think of GovCare as a handout to someone else, all of us “could be one day away from losing a job and the health[care] insurance that comes with it *** have a loved one born with a preexisting condition *** will eventually have preexisting conditions ourselves, possibly before we are eligible for Medicare.”  In short, “every single American is a potential beneficiary” of GovCare.  Defense “against the lies and disinformation the Republicans have spread” – Sarah Palin’s “death panels” (existence denied, no mention of the Independent Payment Advisory Board that most definitely is provided for in the legislation) – Ted Cruz’s “government takeover of the healthcare industry” (nonsense, the only doctors on the government payroll work for VA hospitals; no mention that healthcare providers would be under the thumb of government bureaucrats to an unprecedented degree) – “the recent tasteless TV ads funded by the Koch brothers” (not clear what the writer is talking about).  We need to encourage everyone to sign up for healthcare insurance; “truly sickening” that “the Republicans are apparently reaching out to young uninsured adults, encouraging them not to sign up for health[care] insurance as a last-ditch way to undermine the exchanges.”  This column overstates the merits of GovCare, in our opinion, while ignoring the all too real disadvantages.  Furthermore, the sharply partisan tone is inappropriate for a supposedly objective observer.  Compare the latest column from Dr. Ben Carson, professor emeritus of neurosurgery at Johns Hopkins.  Did you really hear what I said?  America’s so tired of intimidation, distraction games, Washington Times, 10/15/13.

10/16/13, A1/A2, Delaware gets its first marketplace enrollee; After multiple tries, Selbyville woman signs up for insurance, Kelly Bothum – Janice Baker, 59, is the first person in Delaware confirmed to have enrolled in the state’s health[care] insurance marketplace.  She is pictured on the front page, and again on page 2 posing with DHSS Secretary Rita Landgraf.  Her experience in signing up on the website was not ideal, but she eventually succeeded.  Going forward, according to Landgraf, “upgrades to the system and the implementation of troubleshooting suggestions like the one Baker tried should reduce the problem.”  Also, “thanks to a change in the website, visitors can explore their health[care] coverage options and potential costs before setting up an account.”  Baker will reportedly “be paying $700 a month for individual coverage, almost $150 less than the cost of her previous coverage.”  Many people around the country are being quoted substantially higher premiums and/or higher deductibles, leading us to wonder how typical Baker’s experience is. See, e.g., Christian Science Monitor, 10/7/13.  Michael Yount of Charlotte, NC, is one such unhappy customer. He and his wife, retired and in their late 50s, have been buying their own health[care] insurance from Blue Cross and Blue Shield (BCBS) in North Carolina, paying about $380 a month with an $11,000 deductible. BCBS is offering them a new plan for three times the cost, $1,124.50 a month, still with an $11,000 deductible. 

10/16/13, Alarmist rhetoric reaches crescendo in NJ coverage of shutdown/debt limit fight(A) Nation nears default, A1/A7, David Espo (AP) – The headline is foreboding, and so is the first sentence.  “Time growing desperately short, Senate leaders took command of efforts to avert a Treasury default and end the partial government shutdown Tuesday after a last big attempt by House Republicans abruptly collapsed.”  But first, the “default” deadline of October 17 was simply an estimate by Treasury Secretary Jack Lew of when the administration would run out of bookkeeping tricks to keep from revealing that it has already exceeded the debt limit – not a date when a default on the US debt would occur.  And more importantly, reading the rest of the report, it was clear that for all the political back and forth a deal was expected today that would kick the fiscal can down the road again. (B) Why US debt matters to average citizen; Treasur[ies] affect rates on home mortgages, Ken Sweet (AP)A simplistic and one-sided primer for low information voters: The federal government “consistently has run a budget deficit for decades” - borrows billions of dollars to pay its bills – is the largest debtor on the planet, owing roughly $12 trillion to public investors.  US debt is considered the safest and most reliable in times of uncertainty – the cornerstone of the global financial system – the “zero point” of risk (meaning “chance that an investment will not pan out as expected”).  If the US were to default on its debt, e.g., miss a few interest payments, financial markets would sink, Social Security checks would be delayed, and “eventually, the economy would almost surely slip into another financial crisis and recession.”  Implies that as long as the US keeps raising its debt limit and borrowing whatever money is needed to cover interest payments, all will be well.  Hmm, isn’t that how a Ponzi scheme works?  (C) Looming fiscal disaster is a self-inflicted wound, A13, editorial – Theme is to agree with former Secretary of Defense Leon Panetta’s lament that “this town has been governing by crisis after crisis.”   The problem, in the words of the NJ, is “this inability of the Republicans and the Democrats to cooperate.”  (D) For Obama and Boehner, weakness is strength, A13, Cass Sunstein (Harvard Law professor) – If you are a tort lawyer and your malpractice plaintiff is determined to go to trial, you can extract a huge settlement by saying “my hands are tied” when it comes to anything reasonable.  This is called the “intransigence effect,” a term coined by Nobel Laureate (2005, economics) Thomas Schelling with regard to labor-management disputes.  Similarly, House Speaker John Boehner has been able to benefit from the fractiousness of the tea party members of his caucus. And the president is in a somewhat similar position, having (1) refrained from relying on the 14th Amendment words that “some legal scholars” claim would permit him to unilaterally ignore the debt limit set by Congress (thereby undermining his bargaining position), and (2) repeatedly said he would not negotiate about terms for raising the debt limit.  In standard negotiating theory, there can be a big problem if both parties say their hands are tied – leading to possibility that no deal is possible and a worst case scenario results for everyone.  In coming weeks, “the nation’s fiscal future might well require [Boehner] to find a way to assert a measure of control over his flock.” The possibility that the president might be following recklessly irresponsible fiscal policies is not mentioned in this supposedly scholarly analysis, nor does Sunstein suggest that the president might possibly need to change his behavior.  

10/15/13, A1/A6-7, Evraz shutting down Claymont steel plant, Aaron Nathans & William McMichael – 375 manufacturing jobs will be lost, 200 held by Delawareans, and as the article demonstrates there is shock and lot of questions.  The overarching theme: is this a matter specific to the steel industry, involving trends that no one could do anything about, or did Delaware contribute to the outcome in some fashion?  No surprise, the governor et al. adhere to the first view.  And the local residents who put pressure on the government for an environmental crackdown on the plant “expressed concern for workers,” even though it doesn’t sound from other comments that they are sorry to see the steel plant close or have accepted any responsibility for this outcome. Esraz (a Russian conglomerate) bought the plant in January 2008 for about $565M, and after a DNREC clean-up order in 2010 invested $16.75M in a recently completed pollution control system in an attempt to resolve complaints.  John Stapleford of CRI is quoted as criticizing “the Markell administration and the General Assembly for raising business and personal income taxes. He [also] said electric costs have gone up, as have worker’s compensation and unemployment insurance costs to businesses.”  Here’s a story from the archives re the pollution abatement investment, which as matters turned out was essentially wasted.

10/15/13, A1/A2, Public sounds off on power plant proposal, Melissa Nann Burke – The third public hearing on the proposed data center/power plant at the Star Campus in Newark basically recycled arguments that have been offered before without much in the way of new facts.  Opponents of the project claim to be concerned citizens “who are concerned about our well-being and what [would] be the best for our community,” versus “radical environmentalists” or “job haters or extremists.”  From the story, however, there was precious little positive support for the proposed project at the public meeting, beyond comments by union leaders, e.g., Samuel Latham, state president of the Delaware AFL-CIO, who noted among other things that “I’ve seen this before when I started at the Newark assembly plant [former Chrysler auto plant].  Some of those very same groups [opposing the data center] tried to close the assembly plant.”  Earlier in the day, at an open meeting of the UD Faculty Senate in Mitchell Hall, Data Centers CEO Gene Kern presented what amounted to a status report on the project.  Kern pointed out that the facility’s design will not be complete until March, so at this point he was not able to respond to all of the questions being asked.  Another public meeting is planned in April.  A concern was brought up that UD might decide to buy power from the project rather than from the Newark generating plant, which would cut into city revenues and could mean a tax increase for Newark residents.  City Manager Carol Houck “reinforced that UD must purchase its power from Newark” and City Councilman Jerry Clifton “asked Houck to check into the contractual issue and report those findings at the next council meeting.”  Hmm, that last question makes some sense – even though most of the others do not.  

10/15/13, A10, Time to revise the 1971 Coastal Zone Act, Michael Oates (president of 301 Stories, Inc., lives in Wilmington; produced a 2011 documentary on the CZA, working with the late Gov. Russell Peterson who was the leading advocate of the legislation) – The CZA regulations were never satisfactorily completed so there have been recurring questions about how the CZA should be applied in practice.  In September 2011, Widener Law School sponsored a full-day conference on the path forward, but “sadly, to date no proceedings or further action has come from that work.”  Given all the effort and money being spent on the Delaware City refinery controversy, “it’s time for Delawareans to demand this legislation be reviewed, updated and clarified.” Suggestion: the governor should “appoint a balanced committee – made up of interest groups and concerned citizens” to take on the project.  And happily, DNREC just charged PBF a big fine for environmental lapses at the refinery, so the proceeds could be used to defray the costs involved.  Can’t say that we share the writer’s belief that environmental issues can be resolved by the simple expedient of having people meet and discuss them.  And Oates fails to indicate what the objective should be beyond strengthening “this landmark legislation” so “it can continue to guide us in the future.” 

10/15/13, A11, Living in a world of “shifting winds and currents,” John Sweeney – Apropos of the Claymont steel shutdown, the loss of jobs is a shame for the workers,” not just because of the dollars and cents involved but also because of the effects on them and their families at a personal level.  And the writer also worries about the economic outlook for the state of Delaware, which despite some wins now and then (e.g., the Delaware City refinery restart) faces uncertain prospects.  We may not want China-style wages and environmental standards, but we do need “to start thinking through these problems” because someone needs to be making something in this state or we will never have a healthy economy.  Going back though the works of Alfred Chandler and related commentary, Sweeney came across the concept that the economic world is subject to shifting winds and currents and “we cannot go against them, nor can we predict their direction and force.”  Maybe some of the letter writers fulminating against the data center in Newark should take note of that thought, rather than criticizing Governor Markell for failing to create 50,000 jobs as “he promised.”  When your future is being sucked away, it’s time to try something – “and we’re not responding.”  Hear, hear!  There is no investment proposal anyone can come up with that doesn’t offend someone for some reason.  Accordingly, if the state wants jobs it’s time to start showing some common sense and letting investors and business managers do their thing without trying to micromanage their activities. 

10/12/13, “top story: government shutdown(A) GOP makes offers to raise debt limit in exchange for healthcare, budget changes, A1A5. David Espo (AP) – Basically neutral coverage of negotiations in progress, with differing offers from House Republicans and Senate Republicans, but “no evidence of agreement to end crises that have caused financial markets to shudder and interest rates to rise, while closing some federal offices and sending 350,000 workers home on furlough.” White House and congressional leaders were reportedly “looking for a way to negotiate their way out of an impasse without appearing to negotiate.” And the White House “seemed to wobble” on its refusal to negotiate unless the GOP agreed to an unconditional increase of the debt limit and end to the shutdown “until Senate Majority Leader Harry Reid, D-NV, emphatically reinforced” the “no negotiations” position. (B) Biden’s involvement notably absent from federal shutdown negotiations, A1/A5, Nicole Gaudiano – Biden is reportedly attending all White House meetings and being kept in the loop, but some Democrats feel he was too forthcoming in previous budget negotiations and Senator Reid is serving this time around as the Democrats’ “primary champion.” According to Jim Manley, Reid’s “former chief spokesman,” Reid has long wanted to take a tougher position in disagreements with Republicans based on a view that “members of the president’s staff thought Republicans were on the up and up and it was possible to negotiate with this gang,” but “I think they finally figured out that that’s not possible.” But not to worry, because Donna Brazille, a political analyst and vice chairwoman of the Democratic National Committee” says “I haven’t found any evidence that Joe Biden has become a shrinking violet.” Less than a year ago, the News Journal endorsed the president for reelection because, among other things, Biden was “exactly the kind of experienced hand a president would want” to work out deals with Congress on fiscal matters. We thought that was a weak argument then; it looks ridiculous now. Picking the leadership America needs, 11/4/12. (C) Soon, the shutdown will impose pain on all of us, A8, editorial – A litany of woes are enumerated: medical research stopped - mortgage loans stalled - federal prosecutors, defense attorneys and soon the federal judiciary “will be at a standstill” – important work overseas hampered – people around the world “looking at us as if we are crazy” – imported seafood not being inspected – potential shortage of vaccines that poultry, cattle and hog companies need for food safety – “most of us know a federal worker sent home, soon it will be state workers and nonprofit workers, [even] workers from businesses that contract with the government. “It is foolish to impose such a punishment on the country.” So just keep spending until the roof caves in? (D) Three letters implicitly or explicitly blaming Republicans, A8 – “hard nosed folks” who “claim to revere the Constitution when it comes to the need for guns and the continuation of their personal declared beliefs” but otherwise feel “that what needs to be respected should be the choice of the individual” – federal law enforcement “forced to go to work and perform their job, but without pay” (they will get paid in due course) while Congress “is still receiving their paycheck, but they aren’t doing their job” – normal Republicans “are afraid to take on the extremists because the big-money rightist donors like the Koch brothers stand ready to fund primary Republican challenges in House and Senate districts if the current office-holders don’t indulge their extremist colleagues.” (E) Looks like Boehner is really playing to win, A9, Eugene Robinson –The writer suggests that Speaker Boehner, who cares for nothing but retention of his speakership, is taking positions that he knows cannot be won (e.g., attempt to defund GovCare) in order to appease the tea party members in his caucus. “If what the House GOP wanted was a Pickett’s charge, Boehner showed that he was willing to lead it.” Republicans are taking a pounding in the polls, down to a record low 28% approval rating according to Gallup, but alas, “redistricting has made the House majority difficult to dislodge.” And even if Boehner winds up abjectly caving, with no concessions from the administration, House Republicans have nowhere else to turn. Eric Cantor has followed Boehner in lock step, Rep. Paul Ryan “is off quietly fiddling with his numbers,” and “who else is even considered speaker material?” (F) Why don’t the media show Obama’s stubborn side, A8, Charles Krauthammer – According to the writer, “the president’s real intent is to score a humiliating victory over the GOP” and so far, according to the polls, he is winning. However, the Democrats have overplayed their hand in some respects, e.g., ham-handed national park shutdowns that are widely seen as vindictive. Also, their current partisan advantage is a wasting asset, and if there really was a default due to failure to raise the national debt limit the consequences would be “ruinous to what’s left of the presidency” so the president cannot really refuse to negotiate. Time for the Republicans to wake up, decide what they want and can realistically expect to get, and put it on the table. Paul Ryan, “as usual, points the way.” His approach would offer: “A serious attack on the deficit – good. Refiguring sequestration to restore some defense spending and some logic to discretionary spending – also good. Forcing the president off Mount Olympus – priceless.” We give the NJ credit for publishing the Krauthammer column, if only as counterpoint. See also Ryan’s 10/9/13 column in the Wall Street Journal.


10/10/13, A7, Study: Off-the-charts heat to hit world around 2047, Seth Borenstein (AP) – The study “used weather observations, computer models and other data to calculate the point at which every year from then on will be warmer than the hottest year ever recorded over the last 150 years.” The predicted crossover date varies by locale, e.g., Kingston, Jamaica in “about a decade,” Singapore 2028, Mexico City 2031, Cairo 2036, Phoenix & Honolulu 2043, “the whole world” (global average) in 2047 vs. “hottest year on record” (2005). Study published in the journal Nature; study author Camilo Mora (University of Hawaii) and his colleagues “hope this new way of looking at climate change will spur governments to do something before it is too late.” Scientists not associated with study are quoted as lauding its results: Jane Lubchenco (Oregon State, former head of NOAA), Chris Field (Carnegie), Judith Curry (Georgia Institute of Technology) who “found Mora’s approach to make more sense than the massive [draft, findings only?] report that came out of the UN-sponsored [IPCC] last month.” No mention of questions re predictions, study methodology, past failures of climate prediction models, or scientific skeptics. This report is basically propaganda, not news.


10/9/13, A1/A2, Government shutdown: (A) Default risk rises, stocks plummet; sides don’t budge, Davis Espo (AP) – “On a day in which both Obama and Republican House Speaker John Boehner appeared on live television, both men appeared to be giving ground yet yielding little if anything of substance.” (B) Families denied death benefits; Foundation steps forward to pay for travel to Dover,” William H. McMichael – Until further notice, family members are not being flown free of charge to Dover Air Force Base to meet dead service members on their return to US soil. Also, they are not being paid the $100K tax-free “gratuity.” The reactions to these decisions were predictably negative, and Senators Chris Coons & Tom Carper joined in a letter with five other senators urging Defense Secretary Chuck Hagel to use “whatever legal discretion you have” to restore the payments. Count us (and also former Defense Secretary Donald Rumsfeld) as skeptics that these rulings were unavoidable.


10/9/13, A12, We need to retool the law governing US borrowing, Charles Lane (Washington Post) – This column presents what purports to be an objective review of past disagreements about national borrowing policy, concluding that we are presently at a unique point at which “crippling partisan conflict in Congress” (because the “war on terror” and the “Great Recession” have “spawned new divisions that the political parties have rushed to exploit”) and “heavy national indebtedness” (due to a big starting debt after World War II plus “a new and seemingly permanent, consensus that accepted a large national security establishment – to prevent a repeat of global war – and a large government role in the economy to protect against macroeconomic vicissitudes”) are simultaneously present. So while “Republicans deserve most of the blame for the current crisis” due to falling under the thrall of “a small faction of ultras” who would like to defund GovCare, we ought to reform the debt limit law so it will be suitable for this “new era of permanent debt and permanent partisan conflict.” Ideally, the new law would continue to “focus Congress on accumulated debt” while minimizing “incentives to delay passage and thus usurp presidential power.” Sorry, what “presidential power” is the writer referring to? Congress is supposed to have the power of the purse as we read the Constitution. Lane’s idea is to convert the debt limit into a formalistic device (“there would still be votes, but less frequently and with as little as possible at stake each time”). And his only specific suggestion is to exclude trust fund debt from the amount of debt being controlled, e.g., limit debt in public hands versus total debt, while saying nothing about unfunded liabilities that would indicate the true debt is not less than the current $17T in debt (we’re already over the $16.7T limit ex the accounting tricks) – but far more, e.g., $70T.


10/9/13, A12, Writer angry because his side didn’t get way, Christine Stout (Middletown) – Jim Venema’s letter (,%202013) draws a heated response. The “writer in Hockessin” should not be mad at “low information voters,” but rather at “all the lies” the Republicans have been “spewing.” GovCare is the law of the land, “not a bill as the Republicans call it,” and the Republicans knew “they couldn’t get their way” so why did they try so hard? Glitches, sure, but maybe “if Congress had worked with the president . . . there would have been less problems.” Insane to pass 46 repeal votes of the legislation, knowing it’s useless, and besides “Republicans are nasty folks” who “take food out of the mouth of babies, seniors, disabled, even families of our servicemen and [service]women.” So let’s vote to repeal those “who voted to shut down the government” (by passing a bill that funded everything except GovCare?) or “at least deny them funding.” So opposition to the continual expansion of the welfare state is un-American? Sorry, we don’t see it that way.


10/7/13, A8, eBay uses Bloom boxes to fuel its data centers, Aaron Nathans – According to this brief report, the eBay data center in Salt Lake City requires 8 megawatts of power and 6 of them will run on Bloom’s fuel cell servers. As a result, eBay will not have to “rely on the electrical grid, running off of natural gas.” Even better, “this is an early example of a Bloom installation that does not have heavy incentives like California,” and “there are a few such examples on the East Coast as well.” Hmm, wonder how true it is that this application makes sense without subsidies.


10/7/13, A10, Keeping guns from the dangerously mentally ill, AG Beau Biden – Using “the senseless shootings at the Navy Yard in Washington, DC” as a starting point, the writer touts the purported merits of HB 88 (which passed the House by a vote of 40-1 this spring, but then “was defeated in the Senate after a lot of misinformation was spread”). Clearly it would be a nice idea to keep dangerously deranged individuals from owning/carrying guns, there is no way to stop them under current laws, and there would be ample procedural safeguards (psychiatrists must report potentially dangerous individuals, after which the police investigate, consult the AG’s office, and then a court is asked to sign an order). The NRA was reportedly on board, e.g., a representative of the gun rights organization told “a House committee in Delaware that this bill could serve as a national model and several changes in the legislation were made to address NRA concerns.” Accordingly, an attempt will be made “to revive the bill in the Senate in January on the first day of the legislative session.” Many gun control proposals are of dubious merit, but this bill may be an exception. In any case, we have an open mind about it.


10/6/13, Justice Scalia speaks at the Conservative Caucus banquet – Addressing a sellout crowd at Harry’s Savoy Ballroom, Justice Antonin Scalia painted a candid and insightful view of the “state of the Court” and then fielded questions from the audience. Here’s a recap of some of his points. (A) “Originalism” is a relatively recent word, which means the words of the Constitution should be construed as the founders intended even though the phenomenon to which they are applied (say electronic communications) may be new. Felonies in colonial times meant crimes punishable by death, for example, so current attempts to classify death sentences as “cruel and unusual punishment” (prohibited by the 8th Amendment) seem unwarranted. That’s not to say there are no logical problems with “originalism,” but simply that this approach to interpreting the Constitution is the best alternative available. Otherwise, what conclusion can one come to except that the Constitution means what 5 or more Supreme Court justices say it means? (B) The key protections built into the Constitution are not the Bill of Rights, even though that’s what people mainly think about, but rather the government structure that is prescribed. Every “banana republic” and “tin horn dictatorship” has a bill of rights that sounds as good as ours or better, but that doesn’t matter because there is no one to enforce the rights and privileges that citizens are supposedly guaranteed. The founders went out of their way to provide for a real bicameral legislature (so the Senate can block the House, or vice versa); that does not exist in most countries, e.g., all the British House of Lords can do is to force the House of Commons to take another vote. There are also checks and balances between the three branches (legislative, executive, judicial). (C) There has been a lot of talk about “gridlock” in DC, which at times makes it very difficult to pass legislation that advocates claim is highly desirable if not essential. Not to worry, because the founders intended that it would be difficult to pass laws – hopefully ensuring that the laws enacted would benefit from thoughtful consideration and robust debate. Of course, that’s not to say the principals should not try to talk with each other, etc., but with divided government such talks don’t always go smoothly. (D) Everyone tends to think the US Supreme Court is “the highest court in the land,” but in practical terms it has less impact on people’s lives than one might think. Bear in mind that the majority of laws affecting our daily existence are established and administered at the state level, e.g., criminal law, contract law, and family law. That’s not a bad thing, since making laws at a state rather than national level can be expected to result in more happy people. Advocates who insist that this, that or the other issue should be decided under the federal Constitution are really trying to avoid the hard work of convincing people around the country and get their way on the issue forever (once the Supreme Court rules there is generally no going back). And after all, what’s the point of having a federal system if all the important issues are to be decided on a national basis anyway? (E) Asked to comment on the recent decision upholding the constitutionality of the Affordable Care Act (aka GovCare), Justice Scalia made clear that he deeply disagrees with the result that was reached. He concluded by describing the majority opinion as “one of the worst” the Court has come out with in recent years. (F) As the Constitution says absolutely nothing about abortion, this issue should pretty clearly have been left to the states. (G) Don’t look to the US Supreme Court – composed of justices nominated by the president and confirmed by the US Senate – to be the bastion of state rights in our federal system. Despite occasional exceptions, it is not going to happen. The real protection for states rights was that senators were picked by the state legislatures, but that was ended by the 17th Amendment providing for the direct election of senators. So to the extent that we still have a federal system, it is a matter of sufferance by the feds versus enforceable right. As for state protests, etc., “you lost the Civil War, get over it.” (H) Increasing power of regulatory agencies is disturbing, but a fact of life. As the government keeps expanding, Congress will inevitably write very general laws and leave more and more of the real decisions to the nonelected bureaucrats in administrative agencies. (I) Too bad about the EPA regulations aimed at limiting CO2, etc. emissions, particularly as the EPA is what Scalia describes as a “cause-related” versus “balanced” agency. Realistically, CO2 is not a pollutant. Similarly, the ambit of the “endangered species” laws has been unnecessarily expanded by interpreting “taking” as activities that threaten the survival of a species and not just shooting, trapping or capturing individual animals. (J) Scalia is sanguine about 5-4 decisions, after all the justices vote based on their convictions and the cases have to be decided one way or the other. He seems merit in publishing dissenting opinions and the votes of the justices, which provides transparency for the process. In many other countries, all that gets published is the majority opinion and the result. (K) “Judicial activism” is a conclusory term, and as such not particularly useful. The justices should decide based on what they think is right and let the chips fall where they may. After the event, Justice Scalia made himself available to inscribe copies of “Reading Law: The Interpretation of Legal Texts,” a 2012 book that Scalia co-authored with Bryan Garner.


10/4/13, State works to meet demand; Delaware hopefuls told to be patient, Beth Miller – The much heralded Oct. 1 opening of healthcare insurance (HCI) enrollment for policies listed on the Delaware exchange has been disrupted because an underlying federal website is not working yet. The only individuals able to enroll at this time are higher income workers. “People who would qualify for subsidies or tax credits have to go through the federal site that’s not working yet.” Ho hum, the system glitches will be worked out in a few days. The real question is whether people will sign up for the HCI coverage after they find out how expensive it is.


10/4/13, A1/A6, Markell defends job promotion record; Questions on economy fielded at public forum, James Fisher – The governor and “a dozen top state officials, including most of his cabinet” appeared at a Q&A style meeting at Cape Henlopen High School on Thursday night. Among other things, Markell touted (A) plans to improve education outcomes so as to produce a workforce that businesses would want to recruit and employ; (B) visits by him and his top staff to at least Delaware companies since 2009 asking how the state government can help; (C) planned $100M investment by poultry conglomerate Allen Harim to turn a shuttered food plant in Milford into a chicken processing plant; (D) no plans to reconsider a planned expansion and bypass of Rte. 13 in Frankford areas; (E) two-year suspension of “prevailing wage” rules that run up costs on state contracts is “not going to happen.” GOP chairman Charlie Copeland said before the forum (in a conference call) that the governor is “attempting to spin what is a failing economy into something it’s not.” One indicator he pointed to is the “budget deficit” that the state is looking at. Why didn’t the governor mention the need for Delawareans to stop blocking progress, e.g., resistance of Newark residents to the planned high tech data center and associated natural gas power plant, and continued sniping of environmentalists at the Delaware City refinery? Why didn’t Copeland cite the state renewable energy policies that have inflated the costs of electric power and the proposed emission rules that would increase the cost of new motor vehicles by up to about $5K?


10/4/13, A10, Time to look to future for Wilmington’s port, Julius Cephas – The writer’s last column (3/17/13) was written to claim credit for stopping a proposal to privatize the Port of Wilmington and supporting the Dole renewal decision. Now he cites an award of $10M in “Tiger Grant V funding” (from the federal Department of Transportation, to “renovate two berths, [which] will improve infrastructure and modernize the port to compete for more business from the coming expansion of the Panama Canal.” And although “the relationship with administration and organized labor still remains tenuous and sometimes not collegial,” things could be improved by appointing executive committee labor members and business contractors to sit on the board.” Cephas goes on to complain about the squeeze on the middle class, as manifested by the drop in the median, inflation-adjusted wage, and call for a minimum hourly wage of $15, expansion of affordable housing programs, clean and renewable energy jobs, and progressive taxation of millionaires/billionaires. The Wilmington port may continue to limp along, but we are not convinced its problems have been fixed.


10/4/13, B1/B2, Finance officials get early start, Doug Denison – The administration organized a brainstorming session about how to slow the rapid run-up in Medicaid outlays (currently run some $700M for Delaware alone, about 40% of the total state budget). The only specific idea that is mentioned is upgrading efforts to block fraudulent claims on the part of patients and/or healthcare providers. The fiscal drag from this program has been building for years. Delaware’s fiscal situation: a case study, 4/27/09. “What can be done about Medicaid here, before it bankrupts the state government? Without claiming to have the answers, we think the time has come for a fresh look at eligibility requirements, services covered, and options for providing needed services more cost effectively.”


10/4/13, B1/B2, Manufacturers try to win over a skilled generation, Matthew Albright – At the headquarters of First State Manufacturing in Milford, company leaders from all over the state showed off products their companies make to a roomful of Milford High School students. The point of the show and tell: to convince students that “manufacturing does not mean boring.” With new and more flexible manufacturing machines, processes can be varied to produce tailor-made products rather than repetitively turning out products in accord with design protocols established by “top company wonks.” Accordingly, workers on the floor can make adjustments on the fly and tweak designs to find ways to make products better. That freedom does require better educated workers, including math and science, with strong computer skills. Intangibles like creativity and a drive to succeed are also important. Such an education will not necessarily be acquired in a traditional college program. Joan Verplanck, CEO of the Delaware Chamber of Commerce, is quoted that “these [blue-collar] jobs are important and . . . not everyone needs to go to a four-year school.” Trade programs at Delaware Technical Community College and other schools were cited as “on the right track.”

10/1/13, A1/A6, Government shuts down: With no deal, federal agencies close for first time in 17 years (Susan Davis, AP) – How many ways are there to blame the “shutdown” (of selected functions, not including the White House chefs) on tea party Republicans, a group that the president is quoted as labeling “one faction of one party in one house of Congress in one branch of government,” while denying any responsibility of Democrats for the current situation?  Quite a few, it seems, judging from the editorial section (A10-A11) plus e-mails from Delaware’s senators that were sent out yesterday.  Here’s a sampling: Editorial: Boehner’s followers actually need to follow him – It seems that the tea partiers are organized as a network rather than a hierarchy, so they have not learned their place in the scheme of things and are not susceptible to the usual inducements from House leadership to follow orders.  But don’t worry, because “at some point, not far away, the public will rebel at this and demand that leadership be returned to government.”  Ruth Marcus: It’s time for John Boehner to truly lead his party – These folks are “ideologues” and “anarchists,” and Speaker Boehner has been indulging them so they can learn for themselves that their pattern of behavior is destructive.  “But as every parent eventually discovers, sometimes you have to step in and tell the kids to cut it out.  Now.  Because if you don’t, you will lurch from tantrum to tantrum, forever, at the mercy of tiny terrorists.  And these tiny terrorists have nuclear weapons in the form of a default on the debt.”  And guess what, if Boehner puts his foot down, history shows that he probably won’t even lose his speakership.  Representative John Carney: Tea party holding Congress hostage – “There are plenty of reasonable Republicans in Congress [but] they’ve let themselves get hijacked by tea party extremists, and by their silence now they’re now helping that small group of radicals hold our government hostage.”  GovCare isn’t perfect, “it needs to be improved, and Congress should be working to make those improvements,” but “it’s the law of the land.”  So it’s time for Republicans to accept that and stop trying to make it fail.  And meanwhile, there are real issues to address: “a balanced, long-term fiscal plan . . . bring down healthcare costs . . . comprehensive tax reform . . . fix our housing finance system.”  The president and “my Democratic colleagues have shown a willingness, time and again, to negotiate with Republicans on the best way to solve those problems” and have not only “made compromises already” but “understand we will need to do so again.”  But “we’ve yet to see House Republicans offer a serious or sincere solution to this crisis [that] they themselves have manufactured.”  Senator Tom Carper, e-mail“ . . . a number of Congressional Republicans refuse to accept that the Affordable Care Act is the law of the land . . . my Democratic colleagues and I have shown repeatedly that we are willing to debate and vote on a number of important issues, including looking for reasonable ways to improve [GovCare], but to demand changes to a law that has been debated and litigated repeatedly in the Congress, in the courts, and across the country and still upheld as a condition for fulfilling our basic obligation to fund the government is unreasonable and unacceptable. Senator Chris Coons, e-mail – Talks about the House and Republicans, rather than singling out the tea party, but places all blame on the GOP. “I’m a member of the Senate Budget Committee and am proud to have helped write a budget that not only fairly replaces the sequester and responsibly reduces the deficit, but still invests in economic growth. The full Senate debated and ultimately approved that budget, but a few Senate Republicans have blocked negotiations with the House from moving forward — ensuring that the federal government will operate without a budget for the fifth straight year.” We don’t think the foregoing comments are in synch with the facts.  Compare (1) The unnecessary conflict; this was the debacle that Barack Obama asked for, Washington Times, 9/30/13; (2) Bob Woodward: If shutdown or debt ceiling causes economic crisis, it’s on the president’s head, Washington Free Beacon, 9/30/13; (3) Hugh Hewitt: “I shouldn’t have to offer anything”: the GOP’s secret weapons – President Obama, Harry Reid and Nancy Pelosi, 10/1/13; (4) this SAFE letter

9/29/13, A1/A6-A11, Unwrapping Obamacare, Beth Miller – Page after page of information about signing up for healthcare insurance through the new Delaware exchange under GovCare.  And despite “ongoing debate in Washington, on radio stations, street corners, Facebook, and everywhere two or more people are gathered together,” readers are breathlessly informed, GovCare is “the law of the land.” According to the story, the penalty for having no HCI is “$95 a year or 1 percent of their annual income – beginning in 2014.  Stay uninsured and the penalties rise to more than $600.”     Hmm, is this really the most important thing that people have to think about these days?  And by the way, if the new insurance plans are so wonderful, why is it necessary to fine people who don’t choose to participate?

9/29/13, A28, Fix Obamacare; don’t try to bury it – Aside from a misstatement (the individual mandate will not “go into effect Tuesday,” the effective date is January 1), this editorial summarizes the current situation in an essentially accurate fashion.  Thus, “the system and its costs will be affected,” but “how much and in which way are not known at the moment.”  The law is described as “deeply flawed,” albeit without describing any of the flaws, and it is stated that “under normal circumstances, the needed fixes cold be applied as time goes on.”  However, since the 2008 elections, when the presidential candidates “offered fairly elaborate plans to fix the costly American health[care] system”, the Republicans “essentially dropped out of the debate” and “went into full-time opposition,” which was “strictly a partisan decision.”  And now a budget battle is raging, with the threat of a government shutdown, “but it will not stop Obamacare from going into effect.”  Comments: (1) What are the flaws in GovCare, which are acknowledged without discussion?  And what basis exists for the assumption that it would be easier to fix said flaws than to repeal the legislation and start over?  (2) Did the Democrats do anything to cause a partisan stalemate, or was this solely the fault of the Republicans because they were disappointed to lose the White House in 2008?  (3) Neither presidential candidate offered a good plan for fixing the healthcare system in 2008.  Both candidates offer pie in the sky healthcare plans, 10/20/08.

9/29/13, A1/A26/A27, Contention churns over data center plan; Markell administration defends project against public opposition, Melissa Nann Burke & Wade Malcolm – Community opposition to the data center + gas powered power generation plan appears to be surging despite the fact that a sounder high tech project would be hard to find, reputed concern about the slack Delaware economy, etc.  And for the first time, the governor and DEDO director Alan Levin are pushing back. (They should have weighed in earlier!)  Why all the fuss?  From the article, it seems to boil down to indignation about the construction of a “fossil-fuel-burning plant” that would “rank among Delaware’s top 10 emitters of greenhouse gases.”  CO2 emitted into the atmosphere naturally migrates around the globe, so what’s the big deal if the plant is sited in Newark vs China? 

9/29/13, A28, At last, some bright news on the TBTF front, A28, Ted Kaufman – This column lauds the following developments re the “too big to fail” syndrome: (1) Levying of fines on JPMorgan by multiple regulators, adding up to $920M, “for its behavior during and after the London Whale fiasco.”  So on top of losing $6B on the bad trades, shareholders should get stuck with this penalty?  And meanwhile, the trader who orchestrated the abusive trading gets a “get out of jail” free card.; (2) It’s finally being acknowledged that the massive GovFinance bill did not deal with TBTF, which was the central issue in the 2008 financial crisis; (3) Europeans regulators will adopt some US regulations, which would undercut “one of the strongest arguments our megabanks have used against new regulations – that they could be put at a competitive advantage;” (4) Larry Summers withdrew from consideration as the new Fed chairman (leaving Janet Yellen as the leading candidate); and (5) Although “neither the president nor Congress are coming up with new legislation to fix the TBTF problem,” there is “a decent chance” that regulators in the US and Europe will simply use the power they already have “to end TBTF without any help from the governments they serve.” Not our idea of “bright news,” sorry! There is no way government can get too big to suit the writer, it seems, although he holds himself out as a believer in the free market system.  

9/28/13, A1/A5, Bloom charge for Delmarva customers soars; Monthly rate has quadrupled since last year, Aaron Nathans – The latest news is a charge of $4.37 in November for the average residential customer, adding up to a $2.79M payment for the month to Diamond State Generation Partners according to a Delmarva filing.  “If such payments continue, it [sic] would total $33.5 million in a year.”  Various sources are cited as commenting, including: Sen. Karen Peterson (D-Stanton): “the jobs are worth the surcharge.”  Sen. Greg Lavelle (R-Sharpley): “There is confusion, concern, and disappointment over this.”  Rep. John Kowalko (D-Newark): Re projections in 2011:
“There was either an inept accounting of what the actual charge would be, or a deliberate misinterpretation of what the amount would be.  I don’t know the answer.”  Bloom Energy VP Joshua Richman: “Bloom continues to provide clean, reliable electricity from its Delaware manufactured fuel cells under the exact same terms that were agreed up a couple of years ago.”  $30M per year for 20 years adds up to $600M in extra cost?

9/27/13, A1/A2, Warming worries for Delaware; UN report increases likelihood of risks, Jeff Montgomery & Molly Murray – “The United Nations panel that authored a bleak assessment of world climate change risks worsened the scenario early this morning, sharpening the odds that global temperatures, sea levels and extreme weather will increase without drastic cuts in emissions from fossil fuel-burning and other human activities.” In the latest report, we are told, the IPCC calls it “extremely likely” (95%+) that “human activities caused more than half the warming seen since the 1950s.  This compares to a “very likely” (90%) rating in the 2007 report.  And the article goes on to cite various predictions of what may happen between now and 2100 unless fossil fuel use is dramatically reduced.  Several Delaware sources are cited as agreeing with the IPCC report that will be published a year from now, including UD professor John Byrne, Susan Love (DE “Sea Level Rise Vulnerability and Adaptation Director”), DNREC Secretary Colin O’Mara, UD Associate Professor Yda Schreuder (who however says DE can’t solve the global warming problem if more coal mines open in China or India, and Chris Bason, Center for the Inland Bays.  The sole dissenting voice was “Delaware skeptic Rich Collins of the Positive Growth Alliance,” who believes the IPCC is “flummoxed because what they’ve predicted is not coming true” and “temperature change is at the bottom of what they’ve predicted.”  Sure, the climate is changing, it’s always changing, and as for sea level rise “all I’m asking is these government types leave us alone.”  This “top story” on what the complete IPCC report will say when it is finalized and issued a year from now seems silly.  We can stand the suspense until then!  But it seems unlikely that the final report will do much of anything to prove the manmade global warming theory that provides the rationale for enormously expensive and counterproductive proposals to do over the global energy infrastructure.  Compare this 9/25 article from the UK Telegraph.

9/27/13, A2, Facts about the IPCC climate panel, Karl Ritter (AP)Big picture of multiple belching smoke stacks, with this caption: “Scientists are more confident than ever that pumping carbon dioxide into the air by burning fossil fuels is warming the planet.  By how much is something governments and scientists meeting in Stockholm will try to pin down.”  Q&A includes “how accurate are the IPCC’s projections?” (answer boils down to ask us again in 2100 and we’ll tell you how they did) and “what does the IPCC say about the recent ‘hiatus’ in warming?”  (global warming fans are still spinning theories, e.g., “many scientists say the purported slowdown reflects random climate fluctuations and an usually hot year, 1998, picked as a starting point for charting temperatures.”  See letter on page A14, from Lee Kumiega of Wilmington, which suggests that governments and politicians are lying about global warming, sea level rise, etc. for one reason – “money.”  Among other things, he makes the interesting point that Tower of London paintings from 1078 A.D. showed a water line at the same level as today – despite the “historical fact the Earth was warmer 1,000 years ago” than now.  As for the money angle: politicians want to “convince us we need a carbon tax and other green energy fees like (Bloom fuel cells) to save the planet,” so “most [people] will go along like sheep.” 

9/24/13, B3, Building job paths; Task force seeks to boost blue-collar work, Jonathan Starkey – At the first in a series of public hearings on ways to increase job opportunities for Delawareans without college degrees, members of the public and state officials reportedly “discussed ways to jump-start the state’s economy and job creation.” Senator Robert Marshall (D-Wilmington), shown at the dais (seated, facing the mike, flanked by two other men), presided.  His task force, which is being co-chaired by Rep. Michael Mulrooney (D-Pennwood), was created by legislation signed into law earlier this year.  But while it is easy to say young Delawareans shouldn’t need a degree in math or science to “live the American dream,” enabling them to do so may be a bit tougher.  State officials apparently spent most of their time rehashing the administration’s “ongoing [albeit distinctly mixed] efforts to create jobs.”  Suggestions from the audience: Earl Lofland of Clayton: Said students should be offered more “opportunities in vocational skills,” and cited efforts to revive maritime industries along Delaware’s coastline.  Alta Porterfield, job center at Delaware Libraries, said job applicants should not be required to answer questions about arrests (only convictions).  Lisa McCloskey of Prices Corner said efforts must be made to bring down the cost of higher education.  Students who graduate with $110K in debt and taking a $30K job “are never going to be able to stimulate the economy.”  Ideas, not criticisms, needed for economy, A10, Mark Kleinschmidt, New Castle County Chamber of Commerce – On a related note, the writer cites a number of business concerns: soaring worker’s compensation insurance rates, surcharges for unemployment insurance, rising state taxes, uncertainties re financial impact of GovCare.  According to him, most businesses and investors are hunkered down in survivor mode versus thinking about job creation, hiking wages, or expanding business lines.  To break out of the box, “we need cooperation, not gridlock.  We need to focus on jobs and the economy – not just social agendas that have dominated the past few years – because there is no more important contributor to quality of life than the ability to have a job and earn a good living.”  And to this end, “we [really the Markell Administration and/or legislature] need to stop focusing on ‘the next big thing’ and look at a series of smaller things [like tax cuts and regulatory common sense] that will give our economy momentum and restore confidence.” 

9/21/13, A8, Another stupid, partisan and useless budget crisis – Re the House spending resolution that left out any money for GovCare implementation, “what kind of game are the Republicans” playing?  Recklessly endangers important institutions – seasoned Republicans with solid conservative credentials and business groups are not going along – but “a powerful group of tea party supporters” are willing “to do anything to kill off” GovCare.  They also want to use the debt ceiling to push deeper spending cuts, tax reform “on their terms,” and authorization of the Keystone Pipeline.  As for the Democrats, they are simply “saying no.” And “the president said he would veto [the spending resolution] even if the Democratic Senate voted for it, which [the Senate] won’t.”  The changes the GOP wants “will not even help the country’s long-term fiscal problems,” because the CBO reports that the approaching fiscal crisis “is years from now” so the challenge is not to cut spending today, it is “to cut and slow spending on Social Security, Medicare and other medical expenses and the interest we must pay on our debt.”  But such adjustments “would affect many of the very people demanding the cuts,” so the GOP blathers about foreign aid, “the legendary fraud, waste and abuse,” etc.  And slashing money for food stamps as the House has done, when the US Census Bureau just reported that 47.5M Americans are living in poverty, unreal! “So come Oct. 1, the government will have to start laying off employees and shutting down services and offices. *** [Then] the federal government will pass its debt limit [and] won’t be able to borrow more money to pay its bills until revenues come in.  *** The damage to the economy could be severe depending on how long it lasts.”  And for what? Republicans are totally irresponsible on budget battle, A9, Eugene Robinson – More of the same, but in a shriller tone.  Now we read that “Republicans in the House are like a bunch of 3-year-olds playing with matches,” and “their hapless leaders don’t have the sense to send them to their rooms.”  Which leaves it to the president, who “is by nature a reasonable and flexible man,” to play the role of “the disciplinarian in this dysfunctional family.”  He “has no option but to stand his ground,” because “you don’t deal with bullies to make a deal to keep the peace.”  But be of good cheer, because “the showdown is a sure political loser for the GOP – and smart Republicans know it.”  By the way, a special shout out for Senator Ted Cruz – an “irresponsible demagogue” who has “whipped the GOP base into a frenzy of unrealistic expectations.”  If Boehner won’t say no, the president must.  It may be the Democrats who want a government shutdown.  They are certainly not making much effort to prevent one.

9/20/13, A1/A7, Health[care insurance] plan rates posted; Figures released for Del. residents, Beth Miller – The state’s “menu” of available plans has now been priced out.  Reportedly the price for individual HCI coverage would range “from $193 a month for an individual basic plan to $329 for an individual ‘platinum’ plan.  Coverage ranges from 60 to 90 percent of qualifying costs, with an assortment of deductibles, co-payments, and co-insurance features.”  In addition, “some residents will qualify for subsidies, and some young Delawareans may be eligible for ‘catastrophic’ plans, the least expensive protection against major problems.” No word as to whether these prices are high or low, etc., just that they have been posted.  Rita Landgraf (who heads the state Department of Health and Social Services) is quoted that this is just “a piece of transforming” the healthcare system.  Linda Nemes in the Delaware Insurance commissioner’s office calls what has happened “phase 1,” and now there will have to be “a monitoring process and ongoing management of the plans and all those activities, making sure carriers are abiding by the laws and requirements.” No comments of GovCare critics are quoted.

9/20/13 B1/B2, Markell riles doubters,  Matthew Albright – Governor Jack Markell appeared on The Daily Rundown on MSNBC yesterday morning, and was asked if there was any merit to criticism of the Common Core State Standards.  “No, because it’s not based in fact,” Markell responded.  “It’s based on this mythology.”  Critics argue that Common Core Standards (CCS) will “[take] educational decisions out of the hands of parents and local educators and [put] them in the hands of federal bureaucrats and corporate bigwigs.”  But Delaware teachers are busily adjusting their teaching plans to conform to the standards and “virtually every state education leader supports the effort.”  Further, the State Board of Education voted yesterday to adopt the Next Generation Science Standards, which reportedly “were developed by states with the help of top scientists and educators, including Delaware’s DuPont [Company].”  Markell went on to claim that the critics were obviously off base as the CCS are “not a federal program,” but rather “a program that was started by states.”  He added that “there are folks out there who are against anything that smacks of change, anything that recognizes we’re in a more globally interdependent world.”  Evan Queitsch, one of the leading critics in Delaware, is quoted that “I think it’s disrespectful for the governor to publicly trash his constituents when they disagree with him.”  We disagree with the governor; the CCS obviously were not a state program but a thinly veiled scheme to circumvent the statutory ban on setting federal standards for education. Will Common Core standards enhance US education? 8/5/13.  Additionally, his attitude is distinctly disrespectful – which is not to his credit.  Compare the intemperate lashing out of former Florida Governor Jeb Bush on the same subject.

9/19/13, A11, Congress should pass a bill to avoid shutdown – The “Democrats already have rejected” the budget proposal that the House GOP is now offering, e.g., extend government funding except for GovCare implementation and, according to this editorial, tie a debt limit increase to approval of the Keystone Pipeline and “a tax reform proposal.”  Too bad, because “this is a bad time for this game playing.”  Note that “the recovery from the recession has failed to affect the bottom of the economic ladder” and “the slow growth experienced by the middle class points to even bigger problems.”  Speaker John Boehner was “speaking for the conservative wing of his party,” while “the more liberal wing of the Democratic Party was refusing to go along with some of the compromises that President had offered in the past.”  So beware, because “the shutdown could hurt services, further spook investors and strain our weak economy.  Talk now and keep the government going.”

9/19/13, A1/A2, State hopeful Fisker bidder will build cars, Aaron Nathans & Jonathan Starkey – This report cleans up yesterday’s coverage of the Energy Department’s planned auction of the $164M Fisker loan, noting that a purchaser of the loan would not necessarily be locked into making cars in the US, let alone in Delaware. “At the end of the day,” said Chelsea Sexton (electric-vehicle advocate and contributor to publications Wired and Popular Science), “the DOE’s going to have to take the best bid they can get.”  And buying the loan is not the same thing as buying the company, although it would allow the buyer to “step into the government’s shoes” and control the liens on Fisker’s intellectual property and physical assets.  These claims might or might not wind up fetching more than the bidder’s purchase price (e.g., $25M) in a bankruptcy proceeding or restructuring – but they would provide no assurances as to what might be done with the Fisker venture.

9/18/13, A1/A2, US plans to auction $164M Fisker loan; new buyer not bound to use Delaware plant, Jonathan Starkey – The premise of this story seems to be that if the government loan was sold, the buyer would take control of Fisker.  Thus, the Energy Department’s loan program will reportedly require bidders for the loan to commit to a “business plan that promotes domestic manufacturing capabilities and related engineering for advanced technology vehicles here in the United States.” A German investor group is said to be interested in buying the $164M in debt for $25M and shifting Fisker’s manufacturing operation in Finland to somewhere in the US (conceivably even Delaware).  And Governor Jack Markell’s quote strikes a somewhat hopeful note: “At least there’s now a path forward.  There’s considerable uncertainty, but at least there’s direction.” Fisker has a lot of private debt outstanding, not to mention stock, so how would a buyer (for a mere $25M) of the government loan automatically acquire the ability to call the shots?  Isn’t the proper procedure for Fisker to file in bankruptcy?   

9/18/13, A10/A11, Bloom surcharge up; customers will pay average of $3.98, Aaron Nathans Delmarva customers will reportedly pay an average surcharge of $3.98 for the Bloom Energy project on their October electric bills, which compares with $3.83 in September.  “Bloom subsidy spikes early,” 8/25/13

9/18/13, A13, Delaware’s fiscal machine gets a caution flag – The latest word from DEFAC, says this editorial, “is no new threats on the horizon, but no real signs of relief either.”  And if the economy does not improve, there may be “a downturn in taxes paid to Delaware.”  Several issues are tied in with fiscal decisions at the federal level, including: (a) Federal budget cuts could “actually cut some of the money that goes to the states;” and (b) “A cut in tax deductions, such as mortgage interest deductions, [could] mean more money for the federal government and the state [which piggybacks the federal tax calculation].” Casino gambling revenues are going down, face it, due to “a full-fledged assault by the big gambling companies in Pennsylvania and Maryland.”  And cigarette tax revenues will inevitably decline because “fewer people are smoking,” but that’s fine because the “long-term health benefit is huge.”  Noticeably missing is any mention of the possibility that state government spending may need to be tightened up in some areas.

9/18/13, A12, Constitution Day spillover – Two more columns, these by DE politicians, about threats to privacy in a digital world.  Senator Chris Coons: Likens “the American public’s justifiable concerns over our government’s extensive digital surveillance programs” to “our Founders’ revolt against the British colonial practice of general searches and seizures.”  Congress needs “to do its job by passing legislation that will introduce more accountability and transparency into the surveillance process,” and to this end Senator Coons touts two bills that he is sponsoring: the FISA Accountability and Privacy Protection Act would provide Congress with more information needed to evaluate the surveillance programs “with a complete understanding of their magnitude;” and the FISA Court Reform Act would create a “special advocate” charged with minimizing the scope of intrusion into Americans’ privacy by ensuring the FISA Courts [Court?] “have the benefit of both sides of the argument.”  The special advocate idea sounds like a waste of time and energy, but more congressional oversight might help. Attorney General Beau Biden: Touts the claimed success of his office in cracking down on sexual predators preying on youngsters on-line and cyber bullying, and then moves on to the subject of educating children (through parents) to be careful what they post on-line because whatever goes there will be there “forever” and can prove embarrassing (or worse) in later years when they are trying to get into college, find a job, or whatever.  “I hope you’ll join me in not only educating our children about these risks, but in seeking to make smarter and safer choices about what we put online.”  

9/17/13, Constitution Day – The News Journal coverage this year consisted of an editorial and two columns re the threat of over-zealous data collection by government authorities for anti-terror and/or law enforcement purposes.  The columnists were Stephen Henderson (law professor, University of Oklahoma) and Samuel Hoff (history & political science professor, law studies director, Delaware State). The general thrust is that new surveillance has spawned data collection on a scale the nation’s founders could hardly have envisioned, and the whole thing threatens to get out of hand.  OK, but when it comes to solutions there doesn’t to be much offered except generalities that it would be nice to strike a balance. Our view is that the government data collection will continue (or grow), like it or not, so the protections for individuals must reside in what Professor Henderson refers to as “ex-post use and dissemination controls.” We would also suggest that there are other issues in the constitutional realm that should be pondered, notably the relentless expansion of Executive Branch power that could set the stage for a dictatorship down the road. See this column in today’s Washington Times by former Senator Jim DeMint.

9/14/13, A9, To not see healthcare as a right is “un-American,” UD economist Saul Hoffman – This is written in response to “a recent essay” by former Senator Jim DeMint, president of the Heritage Foundation, which was published in the News Journal on 8/30/13 along with a story about a Heritage town hall meeting the previous evening.  “His article and his statements are so full of errors and distortions,” says the writer, that “correcting the record is important.”  A. The basic principles of GovCare were developed at the Heritage Foundation and “successfully implemented in Massachusetts by Mitt Romney.”  These principles are “fully conservative” and “not in any way a ‘government takeover’ of the healthcare industry, let alone ‘un-American.’” B. Briefly, GovCare requires that “all people carry insurance,” insurance companies offer HCI coverage to everyone without regard to pre-existing conditions, and “low and moderate income households” receive financial assistance that will “enable them to purchase insurance.” Also, it “strengthens the insurance market for individuals who do not receive HCI from their employers and are likely to be without insurance.  Heretofore, this market has been fragmented, expensive and difficult for individuals to navigate.  The new HCI exchanges will be virtual on-line marketplaces where a set of standardized HCI policies can be readily compared and then purchased by individuals – a “huge positive step that brings [HCI] into the digital age.”  And based on “indications so far,” prices in the private insurance market will be “lower than previously available and much easier to understand and purchase.” C.  According to the Congressional Budget Office, GovCare will reduce the number of uninsured Americans by 37 million.  All of us “will know someone, if not many people, who will benefit” from the GovCare provisions.  D.  The alternative proposals suggested by Republicans in general and DeMint in particular are “useless and pointless.” Romney wanted to “repeal GovCare” and “allow the states to make whatever changes they wanted.”  Humph, “that’s a policy?”  DeMint would allow HCI policies to be purchased across state lines; that means “all policies [would] originate in a state like Texas, with the lowest standards and laxest regulations.”  E. DeMint’s criticisms of GovCare are “equally invalid.”  UPS didn’t drop HCI insurance for spouses due to GovCare, which “barely changes requirements for firms like UPS, that already were providing [HCI] to their employees.  UPS just didn’t want to continue providing HCI for spouses who were entitled to get it elsewhere.  And if the new HCI exchanges are behind schedule, that’s due to the lack of cooperation from Republican governors like Tom Corbett of PA.  The delay of the employer mandate was a result of the extended litigation about GovCare, and it won’t matter anyway since 96% of firms with 50 or more employees already provide HCI to their employees.  As for boosting the debt, the CBO disagrees.  It found that GovCare would reduce the deficit slightly over the first decade because of the inclusion of tax increases and cost savings. F. There is nothing un-American about GovCare.  To the contrary, it is “America at its best” to recognize “healthcare as a basic right of all citizens and then [harness] the power of markets and government to offer a helping hand to those who are less fortunate.” Attempts to link DeMint to Romney are irrelevant.  It’s healthcare insurance (HCI), not health insurance.  A combination of better service, lower cost, and reduced government deficits sounds “too good to be true” – so maybe it isn’t.  Whatever the specifics of the UPS decision, the company (not DeMint) stated that it was dropping spousal coverage due to the provisions of GovCare.  The Hill, 8/22/13.  The writer ignores DeMint’s point that employers are cutting employees back to part time (less than 30 hours) to avoid providing HCI coverage.  And the “un-American” label did not appear in the DeMint column, although it was used at the Heritage town hall and picked up in the News Journal headline. 

9/13/13, more about jobsA. Forecasts or not, the jobs challenge is still with us, editorial – In wake of Moody’s Analytics comment about Delaware economy, “Gov. Markell’s administration naturally . . . [says] the state’s figures look better than what Moody’s is forecasting.”  But no one disagrees that “things are slow.”  Maybe Delaware “will have a better idea of what the economy looks like when the members of the Delaware Economic and Financial Council issue a new forecast on what our situation looks like.”  But whatever DEFAC may say, “we have to keep pushing to make the state a good place to grow jobs.” DEFAC primarily forecasts tax revenue.  Is the government’s concern really about its own power and prestige versus how residents are making out?  B. On economy, keeping fingers crossed and eyes wide, [DE Senator] George [“Greg”] LavelleCompared to Rep. Gary Simpson’s column on welfare benefits, 9/3/13, this is insipid stuff.  It hints Republicans might have different “approaches” and “policies” than the other party, but avoids getting specific.  Thus, everyone agrees that (1) “we would like our economy to do better,” and (2) “there’s simply not enough money [in the Strategic Fund] to buy every job” so “a return to the old normal of systemic job growth” might be “the ultimate goal we all agree on and strive for.”  Meanwhile, let’s hope DEFAC has some good news for us on Monday. C. Markell calls for sea-level rise planning, A1/A2, Jeff Montgomery – So this is the “long-term push” of the Markell administration: “preparing Delaware for the local effects of global climate change and sea level rise”?  The idea is in synch with “leaked versions” of an upcoming UN (IPCC) assessment that warns of dire changes and says “human contributions to the majority of recent warming” are “extremely likely.”  From what we have read, the IPCC is wrestling with how to justify taking this position when global temperatures have not risen over the past 15 years.  Fox News, 8/20/13. And Markell is quoted on a familiar “we can have it all” theme: “This is not just an environmental issue.  This is essential to supporting a thriving economy and protecting the safety of our residents.” Economics does not work that way; higher costs depress outcome versus stimulating it.  Delaware’s renewable energy policies have contributed to the state’s economic malaise, in our opinion, and they should be reversed if the state’s political leaders are serious about promoting economic growth and jobs.

9/12/13, A1/A2, Moody’s sees risk of slump in offing; Housing, jobs data weak in Delaware, Jonathan Starkey & Wade Malcolm – Delaware is the only state in the country still at risk of falling into an economic recession, according to a Wednesday report from the economic forecasting firm Moody’s Analytics that quickly came under fire from Gov. Jack Markell’s administration.”  From what is said, the pushback is mainly a quibble about which statistics to look at.  And the housing market is reportedly mixed, with homes “in high demand in some places, like Hockessin and Brandywine Hundred, but [slower] to sell elsewhere.”  Remedial action?  Sen. Robert Marshall (Wilmington-D), who is chairing “a committee to increase blue-collar jobs in Delaware,” is quoted to the effect that “state government leaders must look for ways to stimulate new hiring” because “things are just not working.”  Where are the jobs? 8/18/13.

9/12/13, A1/A9, Syria plan broke through just in time; Sense of relief with military action on hold, Calvin Woodward (AP) – Previous reports have attributed the Russian proposal that Syria turn over its chemical weapons, details to be worked out, to an offhand comment by Secretary of State John Kerry.  This story attributes the idea to an unscheduled huddle of Putin and the president at the G20 meeting in Russia last week.  The two leaders are described as “pulling up chairs in a corner of a stately room . . . after a very late night of fireworks and lasers etching the St. Petersburg sky.” Following Kerry’s comment at a press conference in London the following Monday, the Russians made a formal offer.  “By the end of the day, though expressing deep skepticism, Obama declared the Russian pitch ‘potentially a significant breakthrough’ that could head off US air strikes.”  That’s where matters now stand, and “some members of Congress [are] beside themselves, trying to make sense of it all.”   

9/12/23, A12, President Obama buys time, but for what purpose? – News Journal editorials about the Syrian situation have been uncharacteristically critical of the president.  This one notes that he was faced with an embarrassing political defeat if the resolution for a Syrian air strike was put to a vote in Congress, and is now in the position of relying on the Russians – who “have armed the Syrians for more than 50 years” and “have never acted in anyone’s interests other than their own.”  So for all the efforts to put a good face on it, there is no indication that the president has “a plan to get out of the Syria mess that he created.”  According to the editorial, there were two crises: one diplomatic and/or military and the second constitutional because a defeat in Congress would “have reverberated through the rest of [this] presidency” with the result that “our gridlocked government would have become even harder to move.” For the most part, we agree, but it doesn’t really seem like a “constitutional crisis” for the president to suffer a legislative defeat.  After all, why is Congress there if it must “rubberstamp” all of the president’s proposals?    

9/11/13, A2, Coons weighing new options for Syria, Nichole Gaudiano – The News Journal continues to portray Senator Chris Coons as shaping the path forward on Syria versus simply scrambling to keep up with a confusing situation.  Now we read that Coons is “part of a bipartisan group of senators working to authorize military force in Syria – but only if international diplomatic efforts fail.”  The goal is to craft a resolution that would “give President Barack Obama room to explore a Russian proposal that Syria surrender its chemical weapons to international control” while keeping “a limited military strike on the table.”  And for those who may question the wisdom of military force in this situation, take heart because “this is not a president who is eager to rush into war.”  Senator Tom Carper is reportedly “encouraged” that the president is pursuing a diplomatic solution, but believes diplomacy can only be effective if there is a threat of military force so “all options must remain on the table.”  The latest version of the resolution would reportedly aim “to build support for a resolution that so far appears unlikely to pass.”  Compare the Wall Street Journal’s editorial this morning:  “Obama rescues Assad: The president lets Putin outmaneuver him on Syrian chemical arms.”

9/11/13, A8/A9, News Journal begins run up to Constitution Day on September 17 with a two-page spread on the Fourth Amendment right to be secure from unreasonable searches and seizures – As John Sweeney suggests in a substantive essay on the topic, the value of these protections is increasingly unclear in an age of digital technology, “big data” analysis, and intrusive government programs in reaction to terrorist threats.

9/11/13, A14, Time for a new direction for the Federal Reserve, Stacie Beck & Eleanor Craig (UD economists) – This column reviews the stop and go Federal Reserve policies in recent years, which have contributed to a slow and uncertain economic recovery.  “The growing ties between Fed and Treasury officials and the investment bank industry” is said “to point to a groupthink that has come to believe that what is good for Wall Street is what is good for everyone else.”  And “it will take an individual of political courage and conviction” to set things straight, but according to the writers “none of the candidates currently under consideration [to succeed outgoing Fed Chairman Ben Bernanke] meets this description.”  An accompanying cartoon shows Janet Yellen and Larry Summers in superhero garb, standing before the desk of the president; “I can tackle inflation and employment!” both are claiming, while the president (seated) looks at them with a bemused expression. The politicization of the Fed Chairman appointment is deplorable, and we have little enthusiasm for either of the “leading candidates.”  However, we believe there is a need to change policy – not just leadership – and have so recommended.  Less is more: a 10-step plan to reboot the economy [see step 5], 9/2/13.

9/9/13, A10, Is this hello or goodbye for Delaware? Michael Fleming (a marketing & communications executive from Wilmington) – The writer marshals a variety of information and statistics to draw a relatively unflattering picture of Delaware.  Most sluggish economy in region “that isn’t exactly tearing the cover off the ball,” 47th state in per capita income growth, ranked in bottom half in CNBC analysis of top states for business, 25% of Delawareans relied on Food Bank services at least one time last year, nearly 15% on food stamps, soft property values in formerly solid middle class neighborhoods across New Castle County, payday loan outfits popping up in new locations, 46th in state crime index, on course to be 3rd most obese state in the nation by 2030, nearly half of DE children are born out of wedlock, highest abortion rate in the country.  And with all this, “it is hard to detect much outrage or any sense of urgency to address these challenges.”  If DE wants transformative change, it will require “radical reform and a comprehensive strategy framed around making [this state] a place that young people want to come [to] and stay.”  Fleming got his start as a staffer for the late Senator Bill Roth, and from the tone of this piece one has to wonder if he might be planning on a run for office.  Here’s his resume: And several additional columns by him, as well as this one, are posted on

9/9/13, B1/B2, Heat, rain above norms; Summer temps staying high once again, Jeff Montgomery – Having repeatedly published alarmists reports about the weather, the News Journal makes the best face of “a cool August.”  Thus, it is reported, “the statistics for June, July and August made 2013 part of a long, warm run that put six of the state’s summers since 2005 among the top 10 hottest since 1895, with the top three marks set in 2010, 2011 and 2012.”  Also, there has been a lot of rain this year.  How were the temperature data measured, and how accurate are they?  And why not admit that the temperatures this summer simply do not fit in with the scenario of inexorably rising temperatures in Delaware?  Also, we noted a News Journal story (AP reporter) yesterday about the shortage of hurricanes so far this year with a headline referring to the results (vs. predictions of an unusually active hurricane season) as a “dud.”  How disappointing for those hoping for bad news that will arguably vindicate their theories. 

9/9/13, A1/A8, [Senator] Coons backs strike plans on Syrian targets, Jonathan Starkey – A member of the Senate Foreign Relations Committee, Coons previously voted for a resolution authorizing a Syrian strike.  In this story, Coons is described as being convinced based on classified briefings that the Assad regime was responsible for the use of chemical weapons (others have denied this, claiming that the weapons were used by the rebels ot some rogue element in the Syrian military).  He also takes comfort in the “narrowing” of the resolution that was submitted for approval by the administration, although the thrust of a previous report (see 9/4/13 story below) was that Coon and Senator John McCain teamed up to add more beef to the resolution. Perhaps it is sinking in that a Syrian strike does not have widespread support and congressional approval of the resolution is far from assured. 

9/4/13, A2, Coons, McCain amend support [military action against] Syria resolution, Nicole Gaudiano & Gregory Korta – Back in DC a week early, members of the Senate Foreign Relations Committee not only voted for the draft resolution but, in one respect, hardened it by an amendment that would urge the president to proceed in such a way as to “change the momentum on the battlefield.”  The rationale, according to Senators John McCain (R-AZ) & Chris Coons (D-DE), is to suggest that the end goal of the military strikes should be “a negotiated settlement that ends the conflict and leads to a democratic government in Syria.”  We are not convinced that the precise wording of the resolution will have much influence on what the president directs the US military to do, but the McCain/Coons amendment makes the resolution less appealing.  Intervention in the Syrian civil war is not justified by US national interests, and doing it for humanitarian reasons is a dubious idea.  The only plausible argument for military action is that the US cannot afford to create the impression that the words of this nation’s president do not need to be taken seriously, and if that’s the point then an airstrike of limited duration should suffice. 

9/4/13, A10, Data center will be a good neighbor for Newark, Michael Bednar (chief sustainability officer for The Data Center, Inc.) – This column sums up the case for building the proposed data center: “a blueprint for new jobs, increased tax revenues, an enhanced business environment and an environmentally safe new neighbor.”  The project will cost over $1B and take about two years to build, putting some 5K construction people to work.  TDC will have about 290 full-time employees (average salary of some $63K) and another 50 part-time workers (about $20 per hour).  There is fulsome praise for Delaware as a business location, including a plug (deserved or not) for its “excellent public school system and excellent and community-sensitive business regulations.”  Oh, and about the electric power plant, “this facility will not be connected to the grid, so it can’t affect electrical service beyond the site and vice versa.” The last statement is flatly contrary to previous reports, and the inconsistency needs to be cleared up.  Huge data center eyes UD site, 5/17/13. “Electric power for the project will come from a natural gas generating system to be provided by Eastern Shore Natural Gas, with excess power sold to the grid.  Newark officials reportedly hope that the additional power source will lower costs for all electric power consumers and make service more reliable in the southern part of Newark.”

9/4/13, A1/A2, Data center plan draws ire, Melissa Nann Burke – A public hearing was held yesterday re a proposed data center/ 248-megawatt gas-fired electric power plant that would go in on the STAR Campus at Newark (former site of the Chrysler plant) next to the Bloom Energy fuel cell factory.  For background, see “Newark airs concerns over data center,” 7/22/13.  An estimated 350 people were present plus 50 more listening to the proceedings from outside, and there were a fair number of critical comments.  However, “the project has won the support of local union leaders and business advocates who highlight the number of jobs the facility would bring to the area and the increase in tax revenue for the local governments and schools.”  Among other things, the discussion clarified an earlier report about the planned use of “technology to capture 90 percent of [the] carbon emissions.”  It is now said “the facility would produce about 2,000 tons per day of carbon dioxide, but officials expect to capture at least 45 percent – ideally 100 percent – of those gases to sell to the soda industry and other industries.”  As for nitrous oxide (NOX), there could be up to 80 tons per year but the facility would generate less NOX than with conventional technologies.  Critic Amy Roe, whose objections have been reported repeatedly, pounced on this as an example of how company officials had contradicted themselves several times.  “They said it’s based on proven technology that’s been used before.  But they also said it’s patent protected technology that needed to be protected by a confidentiality agreement.” Hard to keep everyone happy, but if this project can’t get approved then Delaware – with no reported government subsidies except for a $7.5M state grant to help pay for running natural gas lines to the site and other infrastructure costs – obviously does not want to attract new jobs.

9/3/13, SAFE report: DNREC Secretary Colin O’Mara interviewed on Rick Jensen Show (AM 1150) – Hour long program, cut short by news reports and commercials, with several people calling in with questions.  Secretary O’Mara conceded the cost of the Bloom tariff for ratepayers has come in higher than estimated, but said this is because cheap natural gas have driven down overall power costs so ratepayers are ahead of the game.  The aggressive push to phase out coal generation capacity in Delaware has proven very timely, permitting new gas generation to be brought on line.  O’Mara expressed appreciation for the independent analysts whose forecasts have been vindicated, notably Dave Stevenson at CRI and civic activist John Nichols, and said he considers “some of them his friends.”  The independent analysts have made bad estimates on other matters, however, and – on the whole – he is comfortable with the national analysts on whom the state relied.  As for transparency, which Jensen brought up saying he knew something about politics and thought people generally try to conceal things for a reason, O’Mara expressed agreement that there should be more transparency on Delmarva Power bills (in line with the pending PSC docket, which he looks forward to working on with Dave Stevenson) but let’s put “everything on there” including that customers are paying for power produced in coal-fired plants belching out emissions that foul the atmosphere.  In response to a question from Jensen, O’Mara said he had known some of the Kleiner-Perkins and Bloom people when he formerly worked in California.  He justified Delaware offering subsidies to attract the Bloom venture as unavoidable given the competition with other states to attract high tech manufacturing operations.  And, yes, he would be willing to consider a public debate with some of his critics (Jensen mentioned Nichols name among others) about the broader implications of this venture and energy policy in Delaware.  Dave Stevenson was the first caller (and stayed on the air the longest).  He suggested that the national analysts missed the boat by using projections that were about two years old, whereas CRI used more current information obtained from the US Energy Information Agency.  Thus, the greater accuracy of the CRI estimates was not “a wild guess,” it was a function of doing a thorough job.  Also, using a dollars per month cost for the average consumer understates the impact of the Bloom Energy premium, which might add up to $100K per year for a major business customer.  Re the path forward, the damage is done as far as the tariff for 30 Megawatts (MW) of electric power generation from Bloom fuel cell clusters is concerned.  The contract cannot be canceled under the statute without a huge up front payment.  But for goodness sakes, let’s not commit to the additional 20 MW of capacity that was authorized.  Also, it’s time to build lots of new electric generation capacity in the state, maybe a gigawatt (1,000 MW) in total, to minimize regional grid distribution charges for power generated in other states.  Clint related that he had walked into the Bloom factory in Newark on August 11, where he observed no evidence of manufacturing operations or capability.  A security guard asked what Clint was doing there, and in response to a question the guard said there would be no manufacturing equipment or operations on site for another 30 to 60 days.  The relevance of this is whether Bloom met the requirement that any Bloom fuel cells to generate over an initial 10 MW in power capacity  (21 MW is currently installed per O’Mara) be “manufactured in Delaware.”  O’Mara said he had personally visited the Bloom factory and observed lots of equipment, fuel cells being worked on, etc.  The date of O’Mara’s inspection was not specified, however, and no one asked why Bloom recently saw fit to deny access to reporter Aaron Nathans of the News Journal.  Izzy asked why the data center that is planned at the same site as the Bloom factory wants to buy power from a natural gas power plant that will be built nearby rather than generating the power it needs from Bloom fuel cells.  O’Mara’s answer, basically, was that the data center will be too big to be powered with fuel cellsVic suggested Delmarva customers are getting billed for purported benefits to all residents of the state, which argument may violate the Equal Protection Clause.  O’Mara responded along the lines that there are big benefits involved for Delmarva customers as well as other Delaware residents, e.g., phasing out of coal power plants will yield $1B in health benefits. John Nichols (going last and taking the remaining time) rattled off a series of questions. (1) Consultant’s report shows Bloom fuel cell energy will cost $215 per Megawatt hour (MWH), combined cycle natural gas plant (CCNG) costs $66 per MWH, so why not build a big CCNG plant downstate (where it would save the most on the regional grid distribution charge) instead of comparatively small Bloom fuel cell clusters in northern Delaware?  O’Mara’s said the decision is not an either/or proposition; CCNG capacity is needed as well as Bloom fuel cell power generation.  He noted that a 300 MW CCNG plant is currently under construction in the Dover area.  Also, Bloom fuel cells are a new technology and power generation costs should come down as they gain experience and scale up.  And which is smarter, to be a consumer or to be a producer of cutting edge technology?  (2) Given that Bloom has plants in Mumbai, India and Mexico, what makes you think Bloom will manufacture a lot of fuel cells in Delaware?  The world is changing, says O’Mara, and the advantages of outsourcing to hire cheaper labor are not what they were 10 years ago.  Relevant factors are rising labor costs in the developing countries, significant transportation and logistics costs, and recognition of the value of locating regional plants closer to markets versus building huge plants to meet global demand.  Thus, the DuPont Company doesn’t adhere to a one-plant strategy for its global businesses.  (3) What about hydrogen sulfide, which in the Bloom fuel cell power plants has to be extracted in resin beds that get quite nasty and are obviously hazardous to work with and dispose of?  Hydrogen sulfide is the trace element in natural gas so you can smell it, says O’Mara, and therefore a by-product of any facility consuming natural gas.  The amount is a function of the volume of natural gas used, and some plants in the Coastal Zone produce much more hydrogen sulfide than the Bloom fuel cell power plant yet no one complains about it.  It may matter how the hydrogen sulfide is dissipated, e.g., do the other plants flare it into the atmosphere in harmless trace quantities versus collecting it in resin beds?

9/3/13, A8, Are Delaware’s welfare benefits too generous? Sen. Gary Simpson (R-Milford, Senate minority leader) – The writer reports that “the estimated value of the full package of welfare benefits available in Delaware for a mother with two children” is $30,375 – and it’s not taxable.  “Gulp.”  His source is a recent Cato Institute study, which is recapped in “Why get off welfare?” Michael Tanner, 8/26/13. The point is not that people on welfare are loafers, but simply that “the current welfare system provides such a high level of benefits that it acts as a disincentive for work” and breeds “long-term dependence” of those who are lulled into opting out of the employment market.  “As a legislator and a taxpayer,” says Simpson, “I have to wonder more than ever if the staggering amount of money (more than $650 million in Medicaid alone) Delaware has allocated in its budget every year to pay for its welfare programs is either far too much or spent on the wrong things.”  One can question if the study findings are accurate, e.g., whether welfare beneficiaries do (as assumed) sign up for all the benefit programs they are eligible for.  But instead of turning a blind eye to this report, “let’s find out.”  To this end, Simpson proposes “our own study, through a legislatively mandated task force if necessary,” to consider the situation in Delaware and “determine the correct course of action, whether that’s reducing current benefit levels, modifying eligibility requirement[s] or taking a proactive approach and diverting more of the state funding into our schools.” A constructive idea! And note the possible connection between this proposed study and the public hearings on “job creation” that have already been scheduled.  8/18/13.  One complication, however, is that many of the welfare programs in question are federally funded in whole (e.g., food stamps) or part (e.g., Medicaid).  So there is just so much that could be done at the state level.  We suggested federal action in the last SAFE blog entry (which also cited the Cato study). Less is more: a 10-step plan to reboot the economy, 9/2/13 (see proposal 4, tighten eligibility requirements for food stamps).

9/2/13, A10, Washington must put the focus back on jobs, Senator Chris Coons – “Delawareans are frustrated with Washington and want to know when Congress is going to refocus its attention on jobs and our economy,” says the writer, and “I share their frustration.”  Remember that there are “12 million Americans – including 32,000 Delawareans – still looking for work.” And while nearly 200,000 jobs are being added per month, it could take until 2017 to get back to “full employment.”  Also, “almost 40 percent of those currently unemployed have been out of a job for six months or longer.” So when Congress reconvenes next week, “it should make helping business create jobs its top priority.” Tea Party Republicans in the House – “who believe they can make more of a difference by repealing the Affordable Care Act or imposing reckless across-the-board spending cuts on the economy we’re trying to revive – are the big problem (and should presumably shut up).  We need to make “smarter investments” in the success of “our businesses” – focus on “skills training and the continued growth of the American manufacturing sector” – restore funding for the Manufacturing Extension Partnership (which has sparked a number of “success stories” in Delaware).  As an indicator of futility, “Congress has had fewer than 20 bills signed into law so far this year.”  The Tea Party et al. are happy about this inaction, but “Democrats and many Republicans view [it] as an utter embarrassment.”  Senator Carper, Representative Carney and I “have tried to get around the Washington gridlock by hosting job fairs throughout Delaware” – 15 of them over the past three years that in the aggregate put more than 12,000 job seekers in the room with hundreds of local employers.  “Nothing makes me happier as a senator than hearing from Delawareans who got a job that they applied for at one of our fairs.”  We agree Congress should focus on the economy, but differ as to how Congress should go about it.  Jobs are and should be created in the private sector.  The big play would be to abandon or fix government policies that are discouraging productive investment or fostering unemployment.  Less is more: a 10-step plan to reboot the economy, 9/2/13.

9/2/13, B1/B2, State kicks off insurance outreach; Resources available to navigate new marketplace, Kelly BothumPhotos: Rita Landgraf (secretary, DE Dept. of Health & Social Services) & Dr. Janice Nevins (Christiana Care Health System).  In less than a month, “Delaware residents without health[care] insurance can sign up through the state’s insurance marketplace” and “state officials are spreading the message” with the objective of encouraging uninsured residents to sign up.  “The marketplace” is a federal-state partnership exchange for acquiring healthcare insurance (HCI) under the GovCare legislation.  “Delaware is anticipating serving up to 35,000 newly insured residents . . . in an effort to keep premiums lower.”  Also, “as many as 30,000 residents are expected to gain access to healthcare through the state’s expansion of Medicaid.”  How to get the word out?  “More than six dozen people have been trained and certified as marketplace guides and navigators.” (Federal grants of $4.55 million are cited to various organizations, e.g., Brandywine Women’s Health Association, Christiana Care Health System . . .).  And “the state also has a marketing campaign, including billboards, social media and other advertisements letting residents know how they can find out more.” Three insurers have submitted medical plans in Delaware: BlueCross/Blue Shield of Delaware, Coventry Health and Life Insurance Company, and Coventry Health Care of Delaware.  There are also four stand-alone dental plans.  All of the medical plans will be in the “bronze” (60% cost coverage) category to minimize premium costs.  Rates for coverage will only be known when the Feds approve and certify the plans, which is expected before the Oct. 1 opening of the marketplace. Rita Landgraf predicts “some glitches in the first year, from problems getting people enrolled to refusal of others to participate, but “once these issues are handled, she expects there to be a smooth transition in 2015, when the focus will be on small business.” Another point will be ensuring that people with HCI coverage are able to “connect to needed medical care.”  Dr. Janice Nevin is quoted that “we’re really excited about the future” and having “the opportunity to provide some of our citizens in Delaware with access to care that they may have never had the opportunity to access in the past.  When people find a medical home and they have chronic conditions, their outcomes improve.”  For better or worse, GovCare will soon be here – and all of us will find out how well it works 

9/1/13, A3, Delaware delegation reviewing Syria plan, Nicole Gaudiano – With the president having decided to request Congressional approval for an air strike on Syria, a reaction to the Assad regime’s use of chemical weapons, the three members of Congress were asked what they thought.  Here is what they said.  Senator Tom Carper – Inclined to support the president’s request, but will reportedly “further review the administration’s intelligence in a classified setting over the coming days to help guide his decision.”  Senator Chris Coons – Agrees with the president that US should avoid any open-ended military commitments in Syria, but sees a need for this nation to take “decisive action” in order to deter any future use of chemical weapons.  “Our failure to act would send a message of impunity for heinous human rights violations.”  Representative John Carney – Supports the president’s decision to seek Congressional approval and will review the plan vs. US interests.  Pronounced himself “extremely wary of committing the military to another overseas conflict.” Our views: (1) The use of poison gas to kill 1,400 people was despicable, but so was the conventional means that have resulted in some 120,000 civilian casualties to date.  If intervention for humanitarian reasons was truly appropriate, it should have been done a while ago.  (2) The real question is what course would serve the nation’s national interests.  A limited air strike, with regime change ruled out as an objective, would take big risks for no good reason.  Don’t do it!  

9/1/13, A16, Shutting down the government is, as they say, nuts, (former Senator) Ted Kaufman – This column argues that Republicans must support “a continuing resolution to fund the government by Oct. 1” and extend the debt limit by the middle of October (per Treasury Secretary Jack Lew’s recent estimate).  Otherwise, “there would be irreparable harm to our credit rating” and “the chaos any prolonged government shutdown would cause is unimaginable.” The president “and an usually united Democratic congressional delegation have said flatly they will not negotiate to avoid the threatened shutdowns.” Therefore, this is just a Republicans vs. Republicans fight, and it’s turning out to be dilly.  12 GOP senators and 71 GOP House members have threatened to “vote against the continuing resolution and increasing the debt limit” unless GovCare (aka Obamacare) is defunded.  Three of the senators are potential presidential candidates, so “no one is dismissing the threat as coming from a fringe group.” [Of course, the writer proceeds to do just that.]  But, look at all those Republicans who disagree, including Sens. Chambliss, Collins, Coburn, & McCain; Reps. Ryan, Cole; the governors of Wisconsin, Mississippi, Iowa & North Dakota; and even “reliably conservative” columnist Charles Krauthammer.  To which, a “dismissive” Senator Ted Cruz’s responds only that “to win this fight, we have to make it riskier to do the wrong thing than it is to do the right thing.”  Citing his time in the US Senate, Kaufman observes that “there are a lot of federal laws I don’t like,” such as the “billion-a-year subsidy given each year to domestic sugar farmers,” but “it never occurred to me I could threaten to close down the government because the executive branch was doing its constitutional duty by implementing a law of the land.  That’s not a temper tantrum.  That’s anarchy.” How can Side A escape any blame for a shutdown simply by saying they don’t plan to negotiate?  Even Secretary Lew has conceded there might need to be some discussion about the level of spending in the continuing resolution.  And a billion-dollar-a-year sugar subsidy, while clearly undesirable, is hardly on a par with a basically non-reversible government takeover of the US healthcare system that was bulled through Congress without a single Republican vote.  As for upholding a “law of the land,” key portions of the administration’s implementation plan – including an IRS ruling that tax credits will be available for participants in federally-run insurance exchanges and a recent decision to delay the employer mandate without delaying the individual mandate – are expressly contrary to the GovCare statute. Delaying the employer mandate requires delaying all of Obamacare, Michael Cannon, Cato Institute, 7/3/13.

8/30/13, Heritage campaign to “defund Obamacare” came to Delaware Valley last night, SAFE report – A standing room only crowd (some 500 people) at the Double Tree by Hilton on Concord Pike heard from Heritage President (and former Senator) Jim DeMint, Heritage Action CEO Mike Needham, and Rafael Cruz (father of Senator Ted Cruz). 


 Senator DeMint

Rafael Cruz


Text Box:  


The Heritage pitch is that the proposal to defund implementation of GovCare (our name) is amply justified in terms of substance and – with enrollment in government-run healthcare insurance (HCI) exchanges set to be October 1 - represents the last chance to stop a government takeover of the healthcare industry - including determination of what healthcare procedures are cost effective, how much doctors should be paid, etc. There are better ways to provide affordable HCI coverage for more Americans, such as tax credits [SAFE opposes any form of subsidies for HCI coverage, including tax credits], allowing them to buy policies across state lines, facilitating group coverage purchase plans, and tort reform.  And by the way, every major promise made when GovCare was being proposed is on the way to being broken.  Healthcare costs will go up, not down.  People will not be able to keep their HCI if they like it, and they also may not be able to find full time jobs.  No wonder polls show that a majority of Americans believe the law should be stopped.  Some Republican leaders have suggested that (A) the GovCare issue should be wrapped into the upcoming fight over the debt limit, which will probably be waged after October 1, or (B) it would be smart to let the other side fully implement the law so Americans will see how awful it is.  But these are losing strategies; if the GOP is serious about blocking GovCare, it must make a stand now.  Accordingly, the GOP-controlled House should pass a continuing spending resolution on September 10 (their first day back) that funds every aspect of government except GovCare implementation.  Then, if the other side wants to “shut down the government” over GovCare, let them explain to the American people why they feel that way.  Go to and sign the petition now.  There is also info on the site about which GOP legislators need to be “convinced” to support the defunding strategy. Rafael Cruz concluded the program by relating how he fled Cuba in 1957 after being imprisoned by the Castro regime and came to the US. (By the way, Cuba had an excellent healthcare system before Castro introduced socialized medicine and all the good doctors left.  Now the system is a sham; you can’t even buy aspirin tablets.  And while things are moving a bit slower here in the US, both on socialized medicine and the loss of personal freedom in general, the parallels are frightening.)  Cruz had very little money and didn’t speak English, but he discovered that people would pay him money for washing dishes and it wasn’t necessary to talk very much.  Later, Cruz started his own business and became a pastor.  And 55 years later, he saw his son sworn in as a United States Senator!  Never forget, this is the greatest country in the world and its founding documents are pretty wonderful too. In closing, everyone in the audience was asked to turn to a neighbor and pledge their lives, their fortunes, and their sacred honor to support the principles set forth in the Declaration of Independence. The News Journal also covered this event.  8/30/13, A1/A2, DeMint: Obamacare is un-American: Tea party fave shares message with Del. crowd, Doug Dennison.  This was the last stop on a nine-city tour, it is reported, and “DeMint preached a set of healthcare reforms to the enthusiastic crowd that he said would accomplish the same goals as Obamacare, namely cheaper insurance coverage for more Americans without direct government intervention in the insurance process.” Mike Needham is quoted re the urgency of taking immediate action. Rafael Cruz is identified as being “at the event.”  However, Senator Ted Cruz is reported to have “said this week that congressional Republicans lack the votes necessary to defund Obamacare, though he and others in his party hope the issue will figure heavily in the process to renew the resolution that funds the federal government through Sept. 30.” [Sen. Cruz actually said, "We do not have the votes right now… I believe if we see a grassroots tsunami, that is going to cause Republicans and Democrats to listen to the people.”] The story goes on to relate how “Thursday morning, supporters of Obamacare in Delaware gathered in Wilmington to offer a preemptive rebuttal to the Heritage Action event.  Rita Landgraf was a speaker.  And Senator Tom Carper released a statement supporting GovCare and criticizing “many on the right” for “threatening extreme measures like shutting down the government” instead of “helping find ways to further implement [the law] as effectively as possible.”  Obamacare is just more bad news for the American people, A14, Jim DeMint.  Column makes the case against GovCare in a coherent fashion, including reference to several recent developments – UPS to drop 15K spouses of employees from its HCI plans, and a home healthcare company in Bala Cynwyd will drop HCI to employees “due to skyrocketing costs induced by Obamacare.”  The upshot will be cutting 100 employees down to part-time hours so HCI won’t be required. Rising healthcare costs – loss of current HCI - adverse impacts on the overall economy y – huge bill for taxpayers for a new entitlement, nearly $1.8T in the law’s first decade. In short, “Obamacare is a step in exactly the wrong direction, which is why Congress needs to stop it in its tracks.”

08/28/13, SAFE report: rational energy policy proponent takes shots at Bloom Energy venture on the Rick Jensen show (WDEL, 1150 AM)In interviews on Monday (about 10 minutes) and Tuesday (an hour), civic activist John Nichols covered the waterfront.  The Bloom Energy venture, or “Bloomdoggle” as Jensen calls it, was rushed through the legislature in 2011. Few DE legislators were receptive to critical comments on the venture, or in all probability read the bill.  The mantra was JOBS, that’s all anyone wanted to hear.  And estimates of the proposed surcharge on the bills of Delmarva Power customers sounded de minimis – but as is now evident (see News Journal story below) were radically understated.  Nichols is involved in several efforts to get the facts out and encourage remedial action.  (A) Disclosure of a Bloom Energy surcharge, and ideally other “green” energy charges on Delmarva Power bills (Rep. John Kowalko petitioned the PSC, a review will be conducted, Nichol has been granted intervenor status although this needs to be confirmed at a Sept. 10 meeting of the PSC). (B) Pending federal lawsuit to challenge the Bloom Energy venture on constitutional grounds [Plaintiffs are Fuel Cell Energy in CT, which claims they were not allowed to bid on the venture, and Nichols as one of the many Delmarva Power customer being charged for a job creation “gamble” (as the News Journal calls it) that will supposedly benefit all Delawareans but is only being charged to Delmarva ratepayers]. (C) Educate the public about flaws of the Bloom Energy venture, e.g., its contribution to higher DE electric power rates could easily lose more jobs for the state than will ever be hired at Bloom’s factory. (Nichols has had several columns published in the News Journal and Washington Times.)  (D) Possible future litigation re Bloom Energy actions that represent “greenwashing” (overstating purported environmental benefits, downplaying economic costs) and/or skirt compliance with commitments associated with subsidies promised by governments (e.g., it’s unclear that some of the fuel cells being installed to generate electric power so as to access the Delmarva Power surcharge were – as required – “manufactured” in Delaware.) “I would rather be hunting and fishing,” Nichols claimed during the interview, but he thinks these issues are important and just can’t let them go.  Rick Jensen has invited Dave Stevenson of the Caesar Rodney Institute to appear on the show, tentatively on Tuesday, Sept. 3.  Among other things, Stevenson will probably comment on the low-ball and now discredited estimates of Bloom Energy costs. See “As Predicted, Ratepayers Ripped Off by Bloom Energy,” CRI.  Jensen may also invite DNREC Secretary Colin O’Mara on the show to defend the Bloom Energy venture, although it’s unknown as of this writing whether O’Mara would be interested. Stay tuned, folks, we’ll keep you posted as this drama unfolds.

8/25/13, A1/A20-21, Bloom subsidy spikes early; Delmarva surcharge grows as anticipated Newark jobs languish, Aaron Nathans – This lengthy and prominent story starts with a visual display comparing the estimated monthly surcharge for the average residential customer of Delmarva in September 2013 ($3.83) to the monthly estimate in Oct. 2012 (67¢).  Given a 471% increase in a year’s time, one might be forgiven for thinking the original estimate was recklessly if not dishonestly understated. However, the ensuing story is kinder.  The discrepancy is attributed primarily to a failure to anticipate cheaper energy levels due to the availability of cheap natural gas from the fracking boom, a situation that may conceivably not last.  And the governor’s office is quoted to the effect that “taking a snapshot of September’s spike is unfair” and the cost of the Bloom Energy surcharge should be evaluated on a longer-term basis.  DNREC Secretary Colin O’Mara adds that that while the surcharge has run higher than expected, this is because electric power costs have dropped, which is a good problem to have.  Another way to look at O’Mara’s point, however, is that “the surcharge, which like other special fees is not detailed on [electric power] bills, already has absorbed much of the savings that Delmarva customers [would otherwise] have seen over the last year from cheaper [electric power].” Although State Senator Greg Lavelle (and most other Republican legislators) voted for the Bloom Energy proposal in 2011 without asking many questions, Lavelle now grouses that “on a number of levels, it was clearly not as advertised to us.”  As for the path forward, two issues are discussed: (A) Questions have been raised as to whether Bloom Energy is on track to create the number of manufacturing jobs in Delaware that were promised.  Although Bloom announced in May that it had started work at the new factory in Newark, thereby becoming eligible to tap into more of the Delmarva Power customer surcharge payments, “it’s not clear exactly what the workers are doing” at the site and “Bloom has refused to allow the News Journal into the plant to see any work that’s underway.”  DNREC Secretary Colin O’Mara recently observed the operations inside the factory, however, and says “they were taking individual components and assembling them into a finished product.”  Accordingly, O’Mara is reportedly “comfortable that Bloom was honoring the spirit [!] of its agreement to manufacture in Delaware” the Bloom fuel cells being installed at the electric power generation facilities that were contracted for by Delmarva Power (which has nothing to do with the project except to collect the surcharge from its customers and remit it to Bloom). (B) There is a move afoot to require disclosure on Delmarva Power bills of the Bloom surcharge and possibly other special charges relating to Delaware’s “renewable power” requirements.  The subject was taken up by the Public Service Commission in response to a petition circulated by Rep. John Kowalko and Sens. Gary Simpson & Dave Lawson.  Delmarva Power has stated (in June) that it supports greater transparency in billing and will work with the PSC to hash out the details.  Workshops for the parties to “exchange ideas on how to accomplish the goal of greater bill transparency” are scheduled, and there will probably be public comment sessions as well. Bloom will presumably skate on the manufactured in Delaware issue, since “manufacturing” was never defined and the administration has no desire to get sticky about the matter.  As for disclosure on Delmarva’s bills, it’s a good idea but smacks of locking the barn door after the horse has been stolen.  The Bloom venture was a bad deal, and in our opinion this should have been obvious from the start.

8/25/13, A24, Bloom deal remains a gamble for jobs – Who knows, says this editorial, years from now we may look back and see that the Bloom Energy venture was a big success because it brought jobs to Delaware and helped to jumpstart a high-tech renaissance on the site of the former Chrysler auto plant in Newark (now owned by the University of Delaware).  And while Delmarva Power customers are angry about the current impact on their bills, they may “gain something back in the future when Delmarva saves money by not having to go out of state to buy more expensive renewable energy.” [That’s a bootstrap argument, if we ever saw one. The renewable energy requirement is itself unjustifiable and should therefore be eliminated.  Bloom Energy could be the last straw, 10/17/11.] Remember Delaware is competing with other states, and also with other nations that have far lower labor costs.  Hoping that “big companies will come here out of the goodness of the CEO’s heart” is foolish, as “no board of directors will allow a CEO to build a factory without an advantage of some kind, whether it is tax help, an educated work force or aid in financing a factory. So look at the Bloom deal as a gamble.  “We hope it pays off.  It is too early to say otherwise.” The editors previously offered the gambling analogy as a rationalization for both the Fisker (now failed) and Bloom ventures.  Where will manufacturing jobs come from? 10/25/11.  Two flaws occur to us.  (1) Who authorized the state government to gamble with taxpayer, or in this case ratepayer, money?  People should gamble with their own money. (2) There are other ways to attract investment, namely low taxes, reasonable regulations, etc. for all businesses in the state. And when jobs don’t materialize, it’s often because such policies are not being followed.  Thus, Micron has just announced policies that will move a lot of US jobs offshore.  The high US corporate tax rate and anticipated costs due to GovCare were factors in the decision.  Is America still pro-business? Austin Hill,, 8/25/13. And to the extent that Delmarva Power bills are being increased by the Bloom deal, the added cost is far higher for business customers than for the average residential customer – which could lead to adverse decisions about future investment by multiple businesses.  Delaware can and must do better than this if it hopes to be competitive.

8/25/13, B3, State sea-level planning grants awarded; focus is preparing for rise in water level, Robin Brown – DNREC announced the 2013 awards, which are being funded by the Office of Ocean and Coastal Resource Management, National Oceanic and Atmospheric Administration. [Why can’t the Feds come up with shorter, less pretentious names?] DNREC Secretary Colin O’Mara is quoted that “it’s absolutely critical that we prepare for more extreme storms and sea level rise.”  The recipients: Widener University, $24,999, “to conduct a comprehensive analysis of the legal means that may be used in managing adaptation to [SLR] to inform property owners, policymakers and the public as to what options are available through the identification of potential tools, review of local and state laws, and recommendation of new laws, regulations or policies.” Delaware City, $20,000, “to evaluate long-term adaptation alternatives in response to [SLR] with tools developed by the Sea Level Rise Adaptation Strategies Community Task Force . . . [using] current engineering projects and community input to develop strategies to minimize risk . . . especially residents and businesses in the Dragon Run drainage area.” Lewes, $20,000, for “review and assessment of the city’s floodplain ordinances [including identification of] opportunities to improve the ordinances and codes [so as] to reduce future flood risks from [SLR] as well as coastal storms.”  Slaughter Beach, $20,000, to identify opportunities for federal grants to raise the first-floor elevations of structures in town above flood level and prepare applications for such grants.  DNREC’s Tanks Management Section, $20,000, for a “near-term vulnerability assessment of hazardous materials installations to assess flood and storm risks on storage tanks, process tanks and pressure vessels containing hazardous substances.”  Bethany Beach, $12,485, “to buy and install equipment for real-time conductivity and water-level monitoring program [so as] to improve the town’s current salt-water intrusion monitoring program  [and] “develop long-term contingency plans to identify future conditions that could trigger remedial responses before the problems become critical.” South Bethany, $9,200, “to establish an elevation base to assist in further defining protection and accommodation options for sea level adaptation strategies” [to include] “center line surveys along the town’s road corridors, along with associated bulkheads and catch basins.”  These grants, $126,684 in total, sound suspiciously like bribes to further the SLR alarmist agenda.  Why on earth is the federal government funding them? 

8/25/13, E1/E3, Former US accountant eyes debt warily, Christina Rexrode (AP) – The “US accountant” is David Walker, formerly US Comptroller General, here pictured (head shot) in a contemplative pose.  Although the economy is said to be improving (slowly) and the annual deficit has been falling, Walker “doesn’t buy the idea that everything is OK.” Stay tuned next month for a major report of the Comeback America Initiative, a nonprofit that he heads.  As a prop, Walker reportedly “stocks his pockets with fake trillion-dollar bills to pass around because, as he says, ‘Washington spends a trillion dollars like it’s nothing.’” As though the current national debt ($17T) was not bad enough, Walker pegs the real debt – counting unfunded promises - as some $73T (over $250K for every person in the country).  To avoid a very bleak future (painful inflation, larger gaps between the rich and the poor, and threats to national security), action must be taken to “stem the financial sinkhole.”  Some ideas: “cut down on healthcare costs, make hospitals provide more information about pricing; . . . index the retirement age to increases in life expectancy . . . [raise taxes by cutting] down on the exemptions that disproportionately benefit the wealthy.”  And in an interview, Walker defended his comparison of the possible fate of the US to the fall of Rome; rejected a suggestion that necessary spending cuts have already been made via sequestration (mindless across the board cuts don’t work, need to separate the wheat from the chaff; current and projected entitlement spending has not been addressed); and rejected the notion that the current level of the stock market is reassuring.  On that last point, Walker warned of growing gaps between “the haves and the have-nots,” the lack of a reliable return on investment for people living on a fixed income, and prices that “are going up faster than what the government tells you because they don’t consider food and energy in the index.”  Good story, too bad it was buried in the back pages of the newspaper where few people will read it.  Re misinformation about inflation, we would add that even the all items Consumer Price Index is suspect.  An economic reality check: part 2, 8/19/13.

8/20/13, B1/B2, Loosening of coastal zone law urged; Jobs panel looking at ideas for economic growth, Doug Denison – Re the launch of a job creation study in Delaware (Where are the jobs? 8/18/13), this story reports that “business leaders on the Blue Collar Jobs Task Force, created this spring by a Senate resolution, said the best thing the state can do to spur expansion, investment and hiring is [to] lighten the regulatory load.” And Chairman Sen. Robert Marshall (D-Wilmington) indicated openness to “any ideas that could help drive down unemployment and create quality ‘blue collar’ jobs.”  So far, apparently, the leading idea is to dial back the Coastal Zone Act, which has stood as an obstacle to new riverfront projects for some 40 years.  The Markell administration sidestepped the CZA in recent decisions re the Delaware City refinery, but it has “treaded carefully in public discussions about revising or weakening the law.”  However, State Labor Secretary John McMahon is quoted to the effect that in these days there is “clean manufacturing that did not exist” in 1971, and “sites available that could be used.” We find this report encouraging; let’s hope it is representative of what will come out of the jobs study.

8/19/13, A1/A7, Delaware makes big gambit on smog rule; EPA contested over need to buy pollution credits, Jeff Montgomery – Here is a new twist on an oft discussed issue, cross state border air pollution. DNREC would like to allow DE power plants to buy credits for pollution reduction out of state versus forcing draconian limits on emissions in DE in order to meet federal smog standards.  According to Colin O’Mara, DE emissions control credits can cost as much as $10K for each ton of emissions, or as much as 200 times higher than the costs in nearby states.  An EPA official is quoted that DNREC’s proposal appeared to exceed the state’s authority, but the agency has not taken a final position and a spokesman in the Philadelphia regional office said the public will have an opportunity to comment if DE adds the out-of-state emissions credit provision to its federally required air-quality plan.  Industrial interests, including the DuPont Company, reportedly support the DNREC proposal.  Given federal rules on state ozone levels and the fact that emissions blow across state lines, the DNREC proposal makes a certain amount of sense.  But it seems like a backdoor assault on the court ruling striking down a regional cap and trade scheme, appeal to the SCt pending, on grounds that the EPA had no authority to implement such a scheme (i.e., legislation by Congress required). See our note at the end of “Shouldn’t have to clean up after other states” editorial, 8/22/12.

8/18/13, A10, Family, friends are real faces of healthcare reform, UD economics professor Saul Hoffman – A well-known proponent of big government, Professor Hoffman has spoken up for GovCare before, e.g., arguing that it is well designed to reduce deficit spending over the long term by bending the healthcare spending curve down.  See point (E) in his last op-ed column, Deficits, debt, spending, 5/14/13. Speaking as an economist, he now asserts, GovCare will “[strengthen] the private sector, especially through the creation of health[care] insurance [HCI] exchanges that will greatly expand and improve the individual [HCI] market.”  But in addition, he claims there will be great benefits for various specified individuals.  Self-employed carpenter: cost of HCI insurance too high, currently gambling on being uninsured, “a healthcare disaster can be just a day away.”  Now he’ll be able to buy HCI through the new exchange, without regard for any preexisting condition, and receive “a subsidy to enable him to afford the insurance.” Corporate employee with HCI who, being “an entrepreneur at heart,” is considering striking out on his own to “pursue new business ideas.”  Now he will be able to purchase HCI through the new exchanges at a price he can afford “and perhaps we will all benefit from his new entrepreneurial activity.” And here are some other people who will likewise be able to purchase HCI through the new exchanges, whereas previously they would have been out of luck. Late 20s man who returned to school to complete an MFA in creative writing.  Girl born with pre-existing medical condition who, but for GovCare, “would never be able to obtain [HCI] in her whole life.  Working woman considering early retirement, who is too young to qualify for Medicare and has preexisting medical conditions. But for GovCare, she would have to keep working.  Tell people in your life, who may be similarly situated, that the exchanges are coming Oct. 1 and they should sign up.  And finally, “I cannot help but wonder why the Republicans are working so hard to deny these essential benefits to my friend’s children, his wife, my nephew and niece and those that you know.”  As an economist, one would think the writer would be familiar with the principle that “there is no such thing as a free lunch.” 

8/18/13, A16/A17, “Where are the jobs?” is reportedly “becoming the most important [question] in America,” and public input will be solicited. – This theme is sounded in an op-ed by Sen. Robert Marshall & Rep. Michael Mulrooney, “Securing employment for the blue-collar worker,” and also in an editorial, “What happens when there is no work?”  Over the next few months, readers are informed, “The News Journal will open its pages to the people who have ideas about what must be done and what we must do.”  And four public hearings on job creation have been scheduled (5:30-8 PM in each case): Sept. 23, Chase Center on the Riverfront; Oct. 15, Town Hall Council Chambers, Middletown; Nov. 13, Del. Dept. of Agriculture, Dover; Nov. 20, UD, Georgetown.  Hmm, how likely is it that government will be seen as the problem rather than the solution?

8/17/13, A1/A2, Coastal ruling limits dissent; A win for industry on 42-year-old law, Jeff Montgomery  – The Delaware Supreme Court denied an appeal by civic activist (and a SAFE member) John Nichols of a decision by the Coastal Zone Industrial Board that Nichols lacked standing to appeal a DNREC decision to permit the construction and operation of a fuel cell/electric power generation facility in the Coastal Zone.  Never mind the merits of the appeal, such as the potential harm to flora and fauna if the rare earth elements in the Bloom Energy fuel cells happened to be dispersed as the result of an accident, he had failed to establish a “particularized interest” in the matter so his arguments, however well reasoned, did not matter.  To reach its conclusion, the Court construed the Coastal Zone Act provision permitting appeal by “any person aggrieved” as requiring a particularized interest rather than construing the words as was probably intended when the CZA was enacted. [The legislature could have easily provided that only persons with a direct economic interest could appeal if that was what they intended, as has effectively been done in writing other statutes.]  Consider these statements:  David Carter of the Delaware Audubon Society: “In the memoirs of Russ Peterson [governor at the time], it was pretty clear how strongly he felt about the voices of the public being heard, and I think that they’re being silenced now.”  Christine Whitehead, a retired attorney and longtime New Castle County civic activist: “It has gone from a time when they would let any environmental group speak on an issue and sue to almost no one can sue unless they show a direct, personal injury.”  Rich Abbott, Esq., who represented Nichols on the appeal: “This raises the practical question of who, other than the industry applicant or DNREC, has standing to appeal to the Coastal Zone Industrial Control Board and to Superior Court.  In my opinion, almost no one else can appeal.” We believe the Supreme Court’s decision was flatly wrong. The Board did not necessarily have to accept Nichols’s substantive arguments, nor arguments re alleged CZA violations at the Delaware City refinery in a more recent appeal of the Sierra Club and Audubon Society, but it should have considered them on the merits.  This decision is illustrative of a larger pattern of muzzling critics who do not happen to be in synch with the political establishment.  Compare the recent US Supreme Court decision that a private group had no standing to appeal non-enforcement of a ban on same sex marriage that was enacted in California by a voter initiative. “Critics on both ends of the political spectrum . . . worry that the decision effectively gives state officials the unchecked power to nullify ballot initiatives they dislike by refusing to enforce them or defend them in court.” Washington Times, 6/30/13.

8/17/13, A9, You decide: Is it Obamacare or Obama-scare?  Ken Currie (a Dagsboro resident) – The writer responds to an op-ed by former Senator Ted Kaufman, “Get ready for a tumultuous 60 days on healthcare,” 8/4/13. The basic thrust is that GovCare is not simply a less than perfect statute (Kaufman’s pitch), it is “fatally flawed” and “most Americans” don’t want it.  Accordingly, “there are only two choices.” One: “Salvage the few good parts of the act, such as coverage of preexisting conditions, and repeal the rest;” or Two: “Make sure that everybody in Congress, the IRS and all the unions and favored friends with exemptions also have to endure all its provisions, just like the rest of us.”  Well put! 

8/16/13, A1/A2, Questions raised on sea level strategy; Groups: Report’s plan could hurt economy, Jeff Montgomery – The Sea Level Advisory Committee report that the News Journal has been talking about for months was finally released, and – will wonders never cease – some people are not in agreement with it.  But despite the headline and lead-in, this latest story supports the alarmist viewpoint about sea level rise (SLR).  Notice the two pictures (on page 2): headshot of DNREC Secretary Colin O’Mara and coastal flooding at Bethany Beach in March with a caption that includes this statement: “The report says as much as 11 percent of the state’s land area could end up under water at high tide by 2010.” So who are the skeptics [shudder] and what are they saying?  Rich Collins, Positive Growth Alliance: “Many of the recommendations in this report could lead to actions in the near future that will have immense economic consequences, yet it will not be known if these actions are truly necessary for decades.”  Howard Fortunato, Home Builders Association of Delaware: “DNREC’s approach will stigmatize our Delaware coastal areas and cost citizens of Delaware greatly for an event that current science indicates may not happen over the course of 87 years. [The problem is] planning for worst case scenarios, rather than implementing an adaptive management approach to possible sea level rise.”  John Taylor, State Chamber of Commerce: “What I tried to steer clear of here was arguing the politics of this.  We quickly got past that and started talking about the reality.  The level of government intervention, that’s yet to be determined.  We did our best to identify where inundation is going to take place, and identifying things that the communities and state can do about it.”  For his part, DNREC Secretary Colin O’Mara said “the next piece is going to be focused on a lot of the educational outreach, working with local governments, making sure they’re comfortable with the science,” and “trying to make sure we’re talking about solutions and debating implications.”  Slipped into the story are several paragraphs about the SLR outlook, including an assertion that “increases could continue for centuries, even if fossil fuel use and emissions of heat-trapping carbon dioxide are sharply reduced.”  A UN panel is expected to update current SLR estimates next month [we can hardly wait], “as well as predictions for rising global temperatures and consequences across a range of human activities, from threats of heat waves and inland flooding to changes to agricultural areas.” We have been and remain skeptical of dire prognostications re SLR, but beyond that it might be helpful to identify the specific recommendations that Messrs. Collins & Fortunato are concerned about.  In other words, what sort of “solutions” is DNREC really talking about? 

8/16/13, A14, Relieved to rule out discrimination – Editorial references “a collective sigh of relief around the country when a federal judge ruled that New York’s ‘stop and frisk’ policy violates the Constitution by unlawfully targeting blacks and Latinos,” even though “the judge’s ruling faced some credible challenges from unrepentant ‘tough-on-crime forces’ in and out of the law enforcement community.”  Thus, in 2011, NYPD conducted more than 600,000 stops – 87 percent involved blacks or Latinos and 88 percent were not arrested for any crime.”  No doubt, it is claimed, “there are more fiscally sound methods to guarantee public safety without such lawfully-endorsed discriminatory procedures.  But it will take the courage of public policy and court officials to explore larger ideas and policies that address crime fighting as a festering blister as early as the crib.”  Using what is actually stop, talk and if warranted frisk tactics – notice the limited number of arrests - the NYPD has been very successful in cutting the incidence of serious crimes (including black-on-black violence).  Other major cities, e.g., Chicago, have been much less successful.  Count us as skeptical that there are “more fiscally sound methods to guarantee public safety.”  As James Madison once said (Federalist Paper 51): “If men were angels, no government would be necessary.” 

8/14/13, A1/A2, State, Dole reach port deal; Fruit firm to remain for next 15 years, Aaron Nathans – State and Dole officials “confirmed an agreement in principle to keep Dole’s operations in Delaware” (Dole had been considering relocation to the new Paulsboro, NJ port when their Port of Wilmington contract expires in 2015).  Key DE concessions: (A) Local 1694 agreed to a pay cut two years ago (however, Local 1694-I led by Julius Cephas has reportedly not followed suit despite “being urged to do so”); (B) Diamond State Port Corporation (which runs the port for the state) has made “several price concessions to Dole” and “agreed to make capital improvements at the port that would benefit Dole, including $34 million assigned to the port over a three-year period that would pay for buying two cranes and renovating cold-storage warehouses.” Query: How does a $34M capital commitment square with a previous statement that the governor had no intention of proposing $20M in the capital budget for the Port of Wilmington to make up for the collapse of the Kinder Morgan deal?  Markell: No help for port, 3/13/13.  Also, Kinder Morgan did not withdraw due to “community opposition,” but due to the opposition of Mr. Cephas et al.

8/14/13, A11, Delaware is building on its economic successes, [Governor] Jack Markell – This column is identified as a response to a column (which we don’t remember reading) by House Republican Dan Short that allegedly likened the state’s economic development strategy to “grabbing at the occasional piece of driftwood.”  The governor makes three general points: (A) Strategy has had some successes: ILC Dover bringing jobs back from Mexico and creating 115 jobs in Millsboro; PBF reopening Delaware City Refinery; “thousands of financial services jobs being created by JPMorgan Chase, Bank of America, Discover, Capital One, Barclays and Citigroup”; Sallie Mae headquarters moved to DE; GE investing $27M in Newark facility; Amazon shipping center hiring hundreds in Middletown; Bloom Energy factory in Newark; and “scores of smaller companies are growing.”  (B) These and other successes represent “a response, in part, to a multi-pronged strategy” to give companies “great schools, a skilled workforce, a good quality of life, a responsive government, an opportunity to connect with global customers and a reasonable cost of doing business.”  Investing in innovative education programs – skills training for out-of-work Delawareans – “eliminated or improved 140 regulations” – bipartisan effort to reduce worker’s compensation rates – “partnered with municipalities to lower electricity rates and collaborated with Calpine and NRG to modernize power plants and invest in additional generation” – “worked with General Assembly to lower the gross receipts tax for manufacturers” – Strategic Fund to support expansions – State Trade Export Promotion program – Project Pop-Up provides free retail space to start businesses in downtown urban areas – Delaware Rural Irrigation Program makes irrigation more affordable for farmers. (C) “I am the first to recognize we have much more to do after [being] devastated by the recession – more than almost any other state – with the closing of the auto plants and the refinery, and the shedding of thousands of financial services, poultry and construction jobs.”  Unemployment is still a big concern in Delaware.  But instead of just searching for “silver bullet” solutions, like the 1981 law that brought credit card banks to Delaware, we need “to promote economic development on multiple fronts.  “I look forward to working with Democrats and Republicans on additional ideas to create jobs.”  And we will “continue to promote entrepreneurship and make Delaware the Startup State.”  Notice that CNBC “got it right once again when it ranked Delaware best in the country for “Business Friendliness,” and that Federal Reserve analysts rightly concluded “Delaware is well positioned for decades of growth ahead.”  For a more balanced discussion, see “Rich States, Poor States,” Arthur Laffer et al., American Legislative Exchange Council (ALEC).  Based on a variety of factors, DE was rated 34 out of 50 states in the 2012 “economic outlook rankings”.  Other mid-Atlantic states fared as follows: MD (20), PA (40), NJ (42), and NY (50). (download PDF).

8/14/13, A10, Let’s not repeat ‘90s federal government shutdown, Rhonda Graham – “How many times can you step up to the plate,” this column begins, “and blather on and on about a home run while wildly swinging the bat?  If it’s House Republicans in Congress [and Senator Ted Cruz, whose role is mentioned later], the answer is as many innings as it takes to trick your opponents into believe you are engaged in a winning strategy.”  But according to the writer, the push to defund GovCare implementation would just repeat the fiasco in 1995-96 when Speaker of the House Newt Gingrich was leading the GOP’s “Contract with America” charge. Never fear, however, because “a growing contingent of smart Republicans – Mitt Rommeny [sic], Newt Gingrich [now older but wiser?], John McCain and House Speaker John Boehner to name a few – aren’t so spooked by the shutdown dare.”  Also, the nonpartisan Congressional Research Service has reportedly confirmed that the funding sources for GovCare are not [reasoning not explained] “subject to the congressional budget process.” The writer left out a few things: (1) the administration has already decreed (without legal authority) delays in several major parts of GovCare, notably the employer mandate; (2) the fiscal problem threatens the economic foundations of this country; and (3) no one is talking about a government shutdown except Democrats. 

8/13/13, A1/A2, Strategy shift: Tea party groups turn efforts, to issues, not candidates Doug DenisonImage in middle of front page of an anti-gun control lobby, prominently featuring a protestors sign. “I’ll keep my freedom, my guns and my money, Obama.  You keep the change!!!” Delaware tea party groups are reportedly investing more time and energy on specific issues (opposition to draconian gun controls, “Common Core” educational standards, etc.) on which they might be able to make a difference, while spending less time lamenting that “I want my country back” and backing activist political candidates (e.g., Christine O’Donnell).  As Rich Collins of the Positive Growth Alliance puts it, “They’re a little bit less idealistic, and a little more practical, and they’re beginning to have some results.”  Or in the words of Theresa Garcia (who heads the 9-12 Delaware Patriots), “We are really learning about the issues, talking to our representatives, going to Legislative Hall.” Steve Grossman, who was on Team Christine in 2010 and has “recently turned his attention to building a more moderate Republican coalition in Delaware,” frets, however, that the tea party should keep recruiting candidates, etc. if they want “a voice at the table in state government.” This story provides no comments from top Republican state leaders as to how the GOP values the tea party energy and hopes to tap into it.  Are they paying attention to what is going on, or have they basically given up?  

8/12/13, B1/B3, Critics reheat debate over climate shift, Molly Murray – First, the results of a Delaware climate study by Dr. Katharine Hayhoe (Texas Tech) were reported. In long term, weather could be scorching, 6/27/13.  Then an opinion column by Paul Driessen & David Legates questioned the validity of the study.  More expert thoughts on state’s future weather, 8/3/13.  Now comes a story in which two people are quoted as supporting the Hayhoe study.  One is Dr. Hayhoe, who claims that (a) Driessen & Legates are confusing apples and oranges and (b) “our methodology and findings are consistent with the US National Climate Assessment and have been evaluated and extensively published in the peer-reviewed literature.”  The second is Deputy State Environmental Chief David Small, who says “The science on this matter is settled and it is our responsibility to get on with the business of preparing Delaware for the future.”  Nevertheless, “climate skeptics at the Caesar Rodney Institute have launched a web-based campaign that questions the science” in the Hayhoe study.  And CRI’s assessment is said to be “the first to question state efforts to gauge the effects of future climate changes, a topic of lively debate,” because “contrarians, until now, have held their fire on the climate change risk project.” It’s irrational to view the manmade global warming theory as “settled science” at a time when climate alarmists are scrambling to explain the leveling off of global temperatures in recent years – contrary to their computer models and predictions.   Global warming takes a vacation, Washington Times, 1/17/13. Also, although we applaud CRI’s efforts, they are not the only ones who have questioned “state efforts to gauge the effects of future climate change.”  See, e.g., Climate change on the coast, 1/12/13. “Judging from this write-up,” we commented, Dr. Hayhoe “is a dyed-in-the-wool climate alarmist who will be helping to craft propaganda versus providing objective advice on scientific issues.”

8/11/13, SAFE reports on an “Evening with Dr. Ben Carson” (not covered by the News Journal) – Dr. Carson spoke last night at a dinner organized by the Frederick Douglass Foundation of Delaware.  The event filled the big room at the Dover Downs Hotel & Conference Center, with an estimated 500 people in attendance.  It was a diverse audience – in terms of age, race, and socio-economic status – with a shared vision of making this country a freer, more prosperous place for the benefit of all.  Listening to the speaker, it is easy to see why he has attained national prominence.  Well informed – calmly logical – personally unassuming – genuinely inspirational.  What we need in addressing the country’s problems (including fixing the healthcare system), Carson told the audience, is “solutions, not excuses.”  The political pendulum has swung far to the left, but it will swing back in due course.  You are the majority, despite the efforts of the “progressives” to convince you otherwise.  Don’t give in to political correctness, which is basically an attempt to shut you up, or be cowed into silence about your religious faith.  And remember, “If I’m wrong and the nation goes over the cliff, we will go over it together.”  Judging from the enthusiastic applause during Carson’s speech and the upbeat tenor of the Q&A session that followed, the audience felt the same way.  (Dr. Carson’s latest book, America the Beautiful, was on sale at the event – and can also be purchased from Amazon ( et al. As the author wryly commented, this is not only the first of his books to be co-authored by his wife, it also happens to be the only one to hit #1 on the New York Times bestseller list.)  

8/11/13, A9, School buses go green, with eco-friendly propane fuel; Districts find alternatives can be cheaper in long run, Larry Copeland (USA Today) – Why should school districts buy propane-powered vs. diesel school buses?  Here’s a recap of the pros and cons according to an AZ school district that recently bought 61 propane buses:

Points of comparison (per bus)



Initial bus cost (approximate)



Fuel cost per gallon (less 50¢ excise tax rebate for propane)


69.4¢ (62.5¢ adj. for 10% lower fuel power content)

18-year fuel cost savings per bus



Fuel availability


Maybe not on trips, plan ahead

CO2 emissions reductions (article cites new, lower levels for buses “enacted by the Obama administration”)


46K tons in first year alone

Sounds like a “no brainer,” but here’s a question: Propane delivered for home heating in DE costs about the same as diesel fuel (less federal & state motor fuel taxes), so why would it be far cheaper than diesel for an AZ school district?  And don’t get us started about the excise tax differential & government rules re CO2 emissions that are cited. 

8/9/13, A15, Public disclosure needed for Newark power plant, Amy Roe (a Newark resident) – The writer’s comments about a proposed natural gas-powered facility to generate electric power were previously reported. Newark airs concerns over data center, 7/22/13. This column spells them out in greater detail.  Allegedly, her study of documents obtained under a FOIA request shows that the private firm and city officials conspired “to classify the power plant as ‘incidental and subordinate’ [to a proposed data center in order] to avoid public zoning review by City Council.”  Moreover, no public meeting about the power plant is planned until the “final plans” are completed, so the City of Newark has “dismissed an opportunity for stakeholder involvement and the cultivation of public trust.”  Several questions about the power plant are cited, including how will it affect property values, and how much air pollution can we expect when “we’re already in non-attainment of the Clear Air Act [standards] for ozone and recently received the grade F from the National Lung Association.”  By the way, “ozone is so harmful to health that the state issues action alerts to warn people not to go outside on high ozone days.” Does the writer want an opportunity to ask questions or a “right” to veto the project?  What about the rights of residents who stand to gain from the boost the data center/ power plant would give to the local economy?  And even if the power plant were to be located outside city limits, wouldn’t the impact on air quality be about the same?

8/7/13, A1/A2, Landmark law likely to stand, Jeff Montgomery – The law in question is the Coastal Zone Act, which has been in the news since “debate over the Delaware City refinery revealed problems with [it].”  However, no move to amend the CZA or modify/expand the CZA regulations appears imminent because there is no consensus as to what sort of changes would be made.  The most salient issue is the rights of public-spirited groups and individuals to appeal DNREC determinations under the CZA that they disagree with.  “Environmental advocates were shocked” when an appeal by the Sierra Club and Audubon Society to the Coastal Zone Industrial Control Board was dismissed for lack of standing, but they probably shouldn’t have been since the Board earlier dismissed an appeal by John Nichols from another DNREC permit (Bloom Energy fuel cell installation for electric power generation) on the same grounds.  “The legal definition of standing awards game, set and match to the corporation and DNREC,” says Lee Ann Walling, a retired chief planner for DNREC whose section oversaw CZA administration.  “I just don’t think that is fair or what the law intended, although I am not a legal expert and don’t know what the solution would be.” Pretty simple: adopt a common sense interpretation of the appeal provision in the CZA, which states that “any person aggrieved” can appeal, and that’s the end of the matter.  Hopefully, the Delaware Supreme Court will decide to do just that in Mr. Nichols’s pending appeal.  

8/7/13, A2, Sea rise, ice melt continuing to climb; study takes wider look at global warming, Seth Borenstein (AP) – Cites “a massive new federal study” (NOAA, 260 pages, which agency chief Kathryn Sullivan calls the agency’s annual “checking on the pulse of the planet,” that indicates “rising sea levels, snow melt, heat buildup in the oceans, and melting Arctic sea ice and Greenland ice sheets” that “all broke records, but temperatures only sneaked into the top 10.”  National Climactic Data Center director Tom Karl says surface temperatures have not risen in the last 10 years, but calls that “only a blip in time due to natural variability.”  Report editor Deke Arndt adds that overall the climate indicators “are all singing the same song that we live in a warming world.”  And while the report purposely doesn’t get into causation, “the causes are primarily greenhouse gases, the burning of fossil fuels.”  For more, see this version of the story posted by CBS News. is another peer-reviewed study that reaches basically the opposite conclusion for the period 1982-2006. Also, it has been reported that the Arctic summer sea ice melt period was exceptionally short in 2013. Is there any wonder we don’t regard the manmade global warming theory as “settled science”?

8/7/13, A8, EPA gives refiners time on [ethanol] mandate; Agency extends deadline to meet renewable fuel quotas, Mark Drajem (Bloomberg News) – EPA “left unchanged this year’s mandate to use 16.55 billion gallons of “renewable fuels,” although it “extended the deadline to comply with the 2013 quotas by four months, and signaled it plans to reduce the legal mandate of 18.15 billion gallons set for 2014.”  The agency also cut its 2013 requirements for use of cellulosic biofuel to 6 million gallons from a proposed 14 million gallons due to lack of market supply.  Does this resolve the complaint of PBF and other refiners about the ethanol mandate? “Higher costs hurting PBF,” Delaware Chatter, 8/2/13. Not really, it’s just a band-aid solution.  What’s needed is for Congress to eliminate the massive phase-in of ethanol mandates under the 2007 energy bill.  And query whether the EPA has authority to “give” relief from legislation passed by Congress or is simply doing what the administration feels like doing.

8/7/13, A11, Core goals would move all students forward – Editorial expresses support for the CS standards that have been adopted and the NG science standards now under consideration on grounds that American students must be better educated to compete with their global peers.  While these standards “do not solve all our problems,” it is said, “they point the way to a better-educated country in the near future” and “we should not let political or cultural differences derail the effort.”  As a practical matter, we are skeptical that these standards will lead to a significant improvement in the performance of the US educational system.  Competition, choice, and smarter management of the financial resources available offer far greater potential for improvement.  See our analysis, 8/5/13.

8/6/13, family, friends and associates celebrate the life of Bill Morris -

8/5/13, A1/A5, National science standards considered for Delaware teachers, Matthew Albright – “As Delaware teachers bring their reading and math teaching in line with national standards [oops, Common Core is supposedly “state standards”], Delaware is headed towards adopting a similar program for science courses.”  Specifically, consideration is being given to the Next Generation Science Standards.  The NG standards “are designed to make science classes more rigorous and to bridge a sometimes wide divide in what is taught in different states, proponents say.” According to Tonyea Mead, science associate at the DE Dept. of Education, the standards aim to engage students in the scientific process.  Thus, DE standards currently require 4th grade students to know life cycles for a variety of plants and animals, but now they would be expected [really, 4th graders!] to analyze life cycles for their differences.  And another important concept for students to know is climate change – with the goal supposedly being to “give students the facts of what we know [who decides that?], so they can hold a healthy debate based on the evidence.”  There has been similar discussion re sea level rise.  Rich Collins of the Positive Growth Alliance fears that the real aim is to “indoctrinate our children” on these subjects.  Similar concerns are expressed by Evan Queitsch of the Delaware Education Reform Coalition, “a group of parents, grandparents and teachers who have railed against a national [oops, again Common Core is supposedly a state initiative] set of standards program.” State officials “emphasize,” however, that “the standards merely outline what students should know, not telling districts or individual teachers how to go about giving students that knowledge.”  Also, some Delawareans have been involved in creating the NG standards, “including a scientist from DuPont.”  The DE Dept. of Education will host a series of public meetings to “discuss the standards.” One can hardly doubt that the educational system can be (and indeed already is being) used for indoctrination purposes, but SAFE does not advocate redoing the school curriculum to instill “conservative” views.  “It should suffice for the schools to focus on academic subjects, such as reading, writing, mathematics, social studies, and science, in a politically neutral fashion, which should be facilitated by “restoring the primacy of state and local control of education.”

8/4/13, A30-31, talk about fundamental differences – Over time, the News Journal editorial section is pretty well balanced between “liberal” and “conservative” viewpoints.  Reading this morning’s paper, however, we were struck by three examples of the yawning gulf between the views of some observers and our own: (A) Get ready for a tumultuous 60 days on healthcare, former Senator Ted Kaufman - The writer says that when he joined 59 other [Democratic] senators in voting for the Affordable Care Act (GovCare), he “did so believing it would greatly improve the current healthcare system but was hardly perfect.  You don’t often get to vote for perfect in Congress.” He was OK with the idea that the GOP would vote once or twice to repeal the legislation, offer amendments to change or improve it, and if all else failed tell everyone that the Democrats should own the results.  But like Norm Ornstein of the American Enterprise Institute, Kaufman views the pledge of some Republicans to defund GovCare implementation in an effort to destroy the law as “contemptible.”  He further quotes “a very conservative Republican, Sen. Richard Burr of North Carolina” as calling this “the dumbest idea I’ve ever heard.”  Kaufman hopes that Sens. Rubio, Cruz, Paul et al. will not “benefit politically from all the resulting turmoil,” but predicts “a tumultuous 60 days in Washington.” A hard line approach is justified by widespread disenchantment with GovCare and the urgent need for leverage to force meaningful spending cuts – which Kaufman’s party has blocked at every turn since the 2010 elections. While the defunding strategy is aggressive and carries obvious risks for Republicans, it is not – by any stretch of the imagination - “contemptible.” The next budget battle takes shape, 7/29/13. (B) Cutting food stamps is irresponsible – “With House Republicans pledging to cut $40 billion from the food stamp program before they left town for vacation last week,” says this editorial, looks like the GOP is determined to be “the party of mean” this fall.  The discussion goes on to blame the enormous growth in “food stamp eligibility” on “the 2008 economic recession that flooded the job market with layoffs and thousands of homes going into foreclosure.”  Now things seem to be looking up a bit, but “the GOP’s plans to attack those who have [not been] able to return to the job market as quickly is somewhat cruel.”  It’s the government’s duty to “consider the needs of hungry Americans and to address them in a just fashion, as opposed to conducting a punitive witch hunt on a class of citizens because their needs are so dire.”  A $40 billion reduction in food stamps over ten years seems modest in relation to the size of this program – we think a bigger reduction would be appropriate.  The editorial overlooks the suspension of work requirements for food stamps, the government’s efforts to get more people hooked on the program, and the dire fiscal implication of the explosion of food stamps and other welfare programs.  Will we gut the US military, for example, to keep handing out more and more food stamps?  Some food stamps history and where to now, 4/29/13. (C) Economic practices bringing us back, Tom Needles (Newark) – Although we don’t recall it, a recent “conservative” letter apparently criticized the “job creation” claims of the Obama administration since, say, the start of 2010.  Whatever, the letter must have struck a nerve, for this is the second rebuttal we have seen. The current letter begins by condescendingly observing that “anyone wanting useful Bureau of Labor Statistics data should check out the historical payroll page on the BLS website.”  Having been “handed an economy that was losing a shocking 1.5 million jobs every two months while sinking in an unprecedented economic death spiral,” the president had to start by stabilizing the economy before worrying about job creation.  Please don’t compare this to “the relatively benign recessions of 1991 and 2001,” where it was possible to return to pre-downturn job levels within 3-4 years.  And today, consumers are deleveraging and “housing is slowly coming back with sound mortgage underwriting standards.”  Sorry, but this recovery has been miserably slow and is anything but stable – largely due to deficient government policies. Schiff: We're Heading For A Crisis Worse Than 2007, Money Morning, 7/28/13.

8/3/13, A1/A2, Carper puts his stamp on postal reform; Five-day and limited delivery in compromise bill, Nicole Gaudiano – The financial and business woes of the US Postal Service are well known, and Congress has been stewing about the matter for some time.  Last year, Senator Carper worked on a bill that passed handily in the Senate, but was DOA in the House.  And earlier this year, USPS plans to halt Saturday mail deliveries, estimated to save $2B a year (a step in the right direction) were blocked by  a provision in a stopgap spending bill.  Now there is better news.  A long-awaited “reform” bill was unveiled on Friday, which is intended to allow for the elimination of Saturday mail and give the USPS flexibility for flexibility for extra days around long weekends and holidays.  Plant closings (like Hare’s Corner in DE) would be banned for two years.  USPS would be allowed to sell non-postal products, ship beer and wine, and have more authority to set prices on its own.  There would also be adjustments in funding requirements for retiree pension and healthcare benefits (no clear explanation of these changes in the story).  The bill is being jointly sponsored by Senators Carper & Tom Coburn (the ranking minority member on the committee), in a marked shift from what happened last year, which has slowed things down (Senator Coburn has a quaint preference for reading every page of every bill that he signs) but vastly improved the chances that the bill – if it passes in the Senate (some Democrat senators are incensed) – will make it through the House.  “Honest to God,” Carper is quoted, “I worked harder on this, trying to find a compromise on postal reform with Tom, than anything I’ve done in my 12 years in the Senate. *** It was worth the effort.”  SAFE comment: Good show! 

8/3/13, A9, More expert thoughts on state’s future weather, Paul Driessen & David Legates – This column questions why DNREC chose to sink $46K in a study by Katherine Hayhoe “on climate change and what was going to happen to Delaware if temperatures continued to rise and the oceans continued to flood the world.”  The gist is that the study is based on computer model predictions of questionable reliability and ignores plenty of contrary historical evidence.  Kudos to the NJ for publishing this column, although cynics have suggested that they generally run conservative columns on Saturday when they will attract the least attention.  A similar but harder hitting piece was posted on Net Right Daily.  Justify power grabs with phony climate science, Driessen & Legates, 7/25/13.

8/2/13, A1/A7, Higher costs hurting PBF; Mandates play role in lower earnings, Jeff Montgomery – A PBF officer characterized the company’s second quarter earnings as “disappointing” and “warned that costly renewable fuel mandates could sharply increase pump prices while triggering cuts in gasoline production at Delaware City and other refineries.”  The specific issue is the federal Renewable Fuels Standard, “approved before the recession,” which “obliges refiners to buy increasing amounts of corn-based ethanol” despite falling gasoline demand, whether they can safely use it or not.  PBF Chairman Tom O’Malley added that the requirement would cost PBF $200 million this year, and that companies have faced “costs for ethanol credits of as much as $1 per gallon,” a large part of which is passed on to consumers in pump prices.  We would add that the folly of mandating a ramp up in the ethanol blending requirement was evident years ago, as SAFE duly reported when the energy bill of 2007 was enacted. “Producing ethanol from corn is ruinously inefficient, not to mention its adverse effects on food prices and the environment. It may eventually be possible to produce ethanol from switch grass and such, but the technology has yet to be developed on a commercial scale.” Fiscal visionaries at bay, 12/24/07.  And even Al Gore has conceded that government support for ethanol (re tax credits, but the same logic applies to mandates) was never justified from an environmental standpoint.  Reuters, 11/22/10.

8/2/13, A1/A5, Markell encourages higher of disabled; governor urges state leaders to take initiative, Jonathan Starkey & Wade Malcolm – Story reports Governor Markell’s pitch at the National Governor’s Association for “increasing job opportunities for people with disabilities” by, for instance, setting hiring goals by executive order and “[holding] agencies accountable for achieving that goal.”  The report on this subject is reportedly “the result of a yearlong initiatives led by Markell, who has served as chairman of the [NGA] for the past year.  The governor noted that only 20% of Americans with disabilities (said to be about 54 million people) have a job or are seeking work, compared to nearly 70% of Americans who do not have a disability.  The story goes on to relate how “some major Delaware employers already have made workers with disabilities a major component of their local business models.”  Unthinking approval of government disability awards has contributed to the subpar employment numbers for people in this category, many of who could be working, and is weakening the overall Social Security system.   

8/2/13, A2, Study: Hotter temps lead to hotter tempers, Seth Borenstein – Could human violence be increasing – from wars to police officers using unnecessary violence and pitchers throwing beanball pitches – just because the world is getting warmer?  No theory about the evils of climate change is too unlikely for this reporter to cover (or the NJ to publish), it seems, and he goes on to recap a variety of studies and “expert” commentary that allegedly prove the point.  What about Stephen Pinker’s analysis indicating an overall, long-term decline in human violence?  Valid or not, Pinker’s conclusions are not mentioned. 

8/2/13, A12, Del. teachers are fully supporting Common Core, John Sell (DE’s 2013 teacher of the year, and now asst. principal at Sussex Technical High School) – According to the writer, CC standards will provide teachers with “an important tool” – “clearer, more rigorous and more focused standards for mathematics and English language arts.”  The standards are said to be “research-based,” and they “were developed by a coalition of education and business leaders, parents and other experts from across the country in a years-long effort that drew bipartisan support.”  As for “a small group of activists in Delaware” who “recently tried to rally support against the standards, claiming they take away local oversight,” these people simply don’t know what they are talking about. Note that “classroom curriculum, which includes materials and lesson plans, remains a local decision.” And, “in an October 2012 survey by EPE Research Center,” 76% of the teachers agreed CC standards will help them improve their own instruction and 87% reported they had already fully or partially integrated the new standards into their classroom instruction.  DE has always had standards, by the way, and the CC standards are “more rigorous” as well as being “aligned with those in almost every other state across the country.”  The alignment is great because it means a child in Claymont will “receive just as rigorous an education as a peer in Clayton . . . [or] in California.”  All students, “no matter what school they attend, are being taught what they need to know to be prepared for college or career.”  To learn more, visit, See the following entry for a different view, and stay tuned for SAFE’s 8/5 blog entry.

7/31/13, [Common Core] Standards under fire; Conservative groups bemoan lack of local education oversight, Matthew Albright - Report about a meeting on Common Core standards last night, including pictures of: (A) Evan Queitsch of the Delaware Education Reform Coalition, flanked by two other people at the speaker’s table; (B) Joanne Christian of Townsend directing a question to Jim Hosley of Caesar Rodney Institute; (C) view from back of meeting room showing nearly a full house with some 100 people in attendance; and (D) Nick Loffer of “the national conservative group Americans for Prosperity” speaking from the podium.  The moderator and question screener (written question cards were collected from audience members) was WDEL radio talk show host Rick Jensen.  General theme of story is that the “conservative activists” on the panel characterized “the use of Common Core State Standards in [Delaware] schools” as “taking decisions about education out of the hands of parents and local school boards.”  Criticisms are noted that the standards were created “by a small group of bureaucrats, interest groups and corporations without enough input from parents and school boards.”  Also, speakers were “concerned about the amount of data governments will keep under a universal system.”  And “some of the event’s speakers also called for public school vouchers, education savings accounts and other programs that would funnel state money to parents to send their children to private or charter schools or to home-school them.”  But not to worry, because readers are informed (without citing sources) that “Common Core is a set of educational standards” and “supporters say [they] will ‘raise the bar for students, while leveling expectations that can vary wildly from state to state.”  Also, again without attribution, “state leaders and Common Core supporters say they hosted public meetings on the standards and that the committees that created them feature many teachers.”  And Common Core must be OK, as it started with a push by governors – with Delaware Gov. Jack Markell prominent among them.” Michael Watson of the state Department of Education asserts that “our student data is always protected” and is “never going to become the property of any company.” Ironically, the front page lead story today is “Hackers steal identity info at UD; 72,000 current, past employees affected, university officials say.”  Other points discussed at the meeting that don’t come through in this account: (A) Although billed as “only standards,” CC will actually determine the evaluations and curriculum.  School boards will be left in charge of administrative matters, but with no say on what gets taught in their schools.  (B) By enforcing national uniformity, CC will put a lid on competition and experimentation.  Predictable result will be to dumb down education so everyone can be “passed.”  (C) Delaware public schools are doing a mediocre job, falling behind both private and religious-run schools in test scores and this is unlikely to change unless and until they are exposed to more competition.  (D) DE per pupil cost of $18K per year is high by national standards, but DE test scores are low (even in comparison to other states, never mind internationally).  (E) A substantial portion of the education budget goes for high-level administrative bloat versus classroom instruction.  (F) Lure to put CC standards in place was “Race to the Top” federal money, basically a short-term bribe for a long-term takeover.  And the Markell administration adopted CC standards without involving the legislature.          

7/31/13, A1, GOP leaders reject Obama budget deal – Here’s the full text of this front page note:  “President Barack Obama offers Republicans a new “grand bargain” to break a long-running budget impasse, but GOP leaders say it is no deal at all.  A3.” The brief (and without attribution) story on A3 fails to mention that the proposed cut in corporate tax rates would be more than offset by other tax increases.  Compare WSJ editorial this morning (link not available), which sums up the president’s proposal as follows: “If Congressional Republicans agree to a corporate tax increase, he’ll agree to spend more money on his favorite public-works projects.” 

7/29/13, signs that the big government express is heading for a troubled future: (A) Survey: Majority in US will face near-poverty, A1/A8, Hope Yen (AP) – AP survey data indicate that “4 out of 5 US adults struggle with joblessness, near poverty or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.”  The morale of minority residents is reportedly improving somewhat, but other Americans (aside from those in the top echelon) are feeling neglected.  The proposed response is to “highlight and address inequality on a broad front” and thereby stem “white alienation,” in another words get more and more people on the dole instead of creating economic opportunity.  “Some Democratic analysts have [called working class whites] a potential ‘decisive swing voter group’ if minority and youth turnout level off in future elections.” (B) Assaults unwarranted on present, future Delaware industry, A12, Harry Themal – With jobs “desperately needed,” this is hardly a time for “dangerous and unwarranted assaults” on Delaware industry.  So why are the Sierra Club of Delaware and Audubon Society intent on launching legal actions that could shut down the Delaware City refinery, not to mention “even more outrageous complaints” of Amy Roe and Rep. John Kowalko about the power plant to support a proposed data center in Newark. Well put! (C) Will Obmacare kick-start healthcare revolution? A13, Ezra Klein (Bloomberg View columnist) – Klein’s argument is that GovCare will create opportunities for new and more entrepreneurial healthcare insurance (HCI) firms by opening clean slate marketplaces to serve people who don’t get HCI from their employers or the government.  His example is “Oscar,” an online operation being backed by 28-year-old Joshua Kushner and other young technologists, which will supposedly be “as easy and intuitive as using your Facebook or your Tumblr page.”  In the words of one of Kushner’s associates, “we have a responsibility to take the friction and pain of engagement out of the process.”  And another says “I don’t think we could do this without Obamacare,” because the existing market was “oligopolized” and “now we [can] have a direct connection to the consumer.”  Maybe, but we find it hard to believe that 20,000+ pages of government regulations will contribute to a genuinely more competitive and efficient marketplace – as opposed to simply reshuffling economic winners and losers in the industry.

7/28/13, A23, The politics of immigration reform won’t be pretty, former Senator Ted Kaufman – Imagine that, a “bipartisan immigration” bill is in play.  The writer attributes this turn of events to the president’s 71% share of the Hispanic vote in the 2012 presidential election.  “Republican analysts looked at the demographic trends and realized that if they continued to lose the Hispanic vote by margins like that they would never again win a presidential election.”  Senator John McCain, in particular, is praised for supporting the Senate bill. [See the following story re McCain’s interactions with the White House.] Things may go slower in the House, however, and “the likeliest scenario is that we will get to the end of the year still deadlocked.” Then, the president et al. “will explain to the American people, who overwhelmingly want reform, why it hasn’t happened,” the Republicans will cave, and “we will get meaningful immigration reform.”  The Senate immigration bill is deeply flawed; by no stretch of the imagination does it represent “reform.” The column suggests that other bipartisan activity is in play as well. Thus, “the House and Senate both passed budget bills for the first time in years [and] quietly voted to fund the government through the end of the [fiscal] year.”  The two budgets are very different, there has been no sit-down to discuss the differences, and an epic budget showdown is expected (see SAFE’s 7/29 blog entry). 

7/28/13, A9, President Obama, Sen. McCain: Washington’s newest odd couple, Julie Pace (AP) – In recent months, John McCain has been a regular visitor to the West Wing and in near-daily contact with senior White House officials. WH Chief of Staff Denis McDonough praises McCain as a “refreshing” partner who “welcomes a debate and welcomes action.”  McCain is seen as “a rare Republican backer” of elements of the president’s second term agenda, “including immigration overhaul, stricter background checks for gun buyers, and perhaps a fall budget deal.” Although recognizing that McCain has just so much influence within his own party, the White House is hopeful that “forging policy breakthroughs with McCain and other Senate Republicans will isolate the House GOP and perhaps persuade them to act.” McCain stated in an AP interview that he and the president “trust each other.” The Arizona Republican gains increased access (a priceless commodity in Washington) and an opportunity to redeem his reputation as a Capitol Hill “maverick” after tacking to the right during his failed 2008 presidential run. He hopes to further “a more aggressive US response” on “international security issues, including Syria.”  This seems like a Faustian bargain for Senator McCain, which he may come to regret.

7/28/13, E1/E4, Older nuke plants on edge, Mark Chediak (Bloomberg News) – Not only are new nuclear power plants not being built, but some of the existing ones are being closed.  Alas, “carbon-free electricity” plants could be replaced by natural gas-powered generators before “they can reap the benefit of [the president’s] proposed climate rules,” which “probably won’t kick in until after the end of this decade.”  Shutdown reasons include political pressure, operating problems requiring major repair outlays, stricter safety regulations in the wake of the 2011 Fukushima disaster, and cheap natural gas due to the fracking boom.  Nuclear power has some unique pluses, including a small environmental footprint, but it should not be supported by government mandates or subsidies.  Let the market decide on the energy sources for generating electric power.

7/24/13, A5, Obama slams GOP tactics, Aamer Madhani (USA Today) – Billed by the White House as a major economic address, the president’s speech in Galesburg, IL focused primarily on blasting his political opponents for slash-and-burn political tactics.  According to aides, the president has become frustrated because Republicans are focused on scandals and overturning GovCare before it can be implemented.  Meanwhile, the president says, nearly all the income gains of the past 10 years have flowed to the top one percent of earners while “the average American earns less than he or she did in 1999” and “companies continue to hold back on hiring those who have been out of work for some time.”  Firing back before the speech based on what was expected to be in it, House Speaker John Boehner likened the president’s effort to “an Easter egg with no candy in it.”  Stay tuned for “a series of [presidential] speeches” presenting some more specific ideas, but they too – most likely – will sound pretty familiar. Promising jobs won’t put people back to work, A12 – According to this companion editorial, the president’s speech “offered no real solutions” to the so-called “jobs crisis.”  And while promising “to use every day remaining in his [second] term to work ‘to make this country work for working Americans again,’ he didn’t say how he would do it . . . other than demanding [that] Republicans get out of the way.”  What is needed, says the editorial, is action – “easing regulations in some cases and tightening them in others” – “cutting some wasteful government spending in some areas and increasing it [wasteful government spending?] in others.” Alas, the two parties “seem incapable of doing anything like that” and Republicans deserve “a special nod of disapproval” because they “are far more busy promising to fight off the healthcare law and [force] a debt limit sacrifice than in getting the economy moving.”  We agree with the Wall Street Journal editorial this morning (no link available), which concluded that the economic recovery has been subpar because of the president’s excessive concern about inequality versus the need to promote economic opportunity and growth. Additionally, making real cuts in bloated government spending does not represent a “sacrifice,” but simply an acknowledgement of economic reality – the government cannot keep ramping up taxes and/or debt without serious consequences.       

7/23/13, A1/A2, Christine’s choice; Republicans wait as O’Donnell weighs another campaign, Doug Denison – To date, no Republican other than Christine O’Donnell has indicated potential interest in challenging incumbent Senator Chris Coons in 2014 (she lost to Coons handily in 2010 after beating Mike Castle in the primary).  And “the tea party sensation has yet to announce her plans for next year, causing some Delaware Republicans to wonder if her indecision is keeping other GOP candidates from stepping forward.” Charlie Copeland, the newly elected head of the state party, reportedly “declined to speculate on how his party might react to an O’Donnell campaign next year.”  2014 is not that far away, and it takes time to organize a campaign, raise money, etc.  If the GOP hopes to be competitive versus simply going through the motions, someone had better get on the stick.

7/22/13,  B1/B2, Newark airs concerns over data center; Facility planned at Chrysler site focus of talks, Melissa Nann Burke – The 5/17/13 report on this venture was very upbeat; it included a claim (not clearly explained) re the proposed electric power generation plant that “when it burns natural gas, Data Centers will use technology to capture 90 percent of its carbon emissions.”  Now Rep. John Kowalko (D-Newark) and “residents” (the one quoted is Amy Roe, a member of the Sierra Club but speaking in her individual capacity) are reportedly voicing concerns as to “how a proposed data-processing center and its associated power-generating turbines would affect, noise, air pollution and quality of life in Newark.”  Roe “highlighted the decision by city staff that electrical generation at the site would not require council approval because it falls with the categories of what’s permitted under city code.”  Far from the power plant being subordinate to the data center, she asserted, “the data center is subordinate to the power plant.”  As for state air quality review, Paul Foster of DNREC said a permit application has not yet been submitted, but “it’s probably going to trigger a lot of requirements,” such as offsets to balance the discharge of emissions.  Natural gas generators are economical and clean.  Making a big fuss about this proposed facility seems clearly inappropriate; does the state want to create jobs or not?

7/22/13, A1/A2, Aging coastal law seen as out of step; Rival groups weigh opening can of worms for updates, Jeff Montgomery – If anyone has articulated some ideas for updating the Coastal Zone Act, it’s not apparent from this report.  The main point of interest is whether the environmental groups who sought to challenge compliance with CZA requirements re the Delaware City refinery – and were ruled by the Coastal Zone Industrial Control Board to lack standing to do so – will pursue the matter in court.  Kenneth Kristl (a Widener Law professor) says he believes the groups have grounds for a further appeal – Audubon is inclined to proceed, but local Sierra Club members say they have to seek their national organization’s review - Christine Whitehead (retired attorney & Civic League for NCC member) cautions that a “huge expense” would be involved.  “It would be a huge fight, and I’m not sure in the end that they would win.  It seems to me that the necessity for jobs in this state is so great that people in charge are willing to take almost any risk to provide those jobs.  I think things are being built that shouldn’t be, simply because of the need for jobs.”  Stay tuned, it will be interesting to see what happens!

7/22/13, A1/A4, Resurrecting bank law gets thumbs down; Delaware lawmakers among major opponents, Jonathan Starkey – Senators Tom Carper & Chris Coons are opposing proposals (backed by Sen. Elizabeth Warren of MA & former Senator Ted Kaufman, among others) to address “the too big to fail” issue for major banks by reinstating legislation along the lines of the Glass-Steagal Act (1930s legislation to separate commercial and investment banking).  They say it would be best to finish writing the regulations under the Dodd-Frank law enacted in 2010 and then see where things stand.  Their position is in synch with that of the major banks, “including some with large operations in Delaware” that “are powerful contributors to political campaigns.”   Although Dodd-Frank “was far-reaching, providing more oversight for proprietary trading at banks, setting up a consumer protection office and establishing an orderly liquidation process for distressed financial firms,” the rulemaking process to implement it is going slowly.  Notably, the so-called Volcker rule – intended to limit trading activities at banks with government-guaranteed deposits – is still under discussion.  SAFE said from the outset that Dodd-Frank would do more harm than good. Our views were ignored by the Delaware congressional delegation (then Carper, Kaufman & Castle), but have been amply vindicated by subsequent developments. 

7/22/13, B1/B9, Wilmington rally brings calls for unity; religious leaders come together at Rodney Square, William McMichael – The mood at yesterday’s rally, according to this report, was “alternately angry, frustrated, joyful and transformative.”  Governor Markell and NCC Executive Tom Gordon are pictured as being in attendance.  The size of the “predominantly African-American crowd” is not estimated.  Among the things said by various speakers: “This was a murder” – “the practice of racial profiling is alive and well across this country” – if the young boy was white, and Zimmerman African-American, “we believe the outcome would have been different” – “This stand your ground law?  Not good for you, not good for the Jews” – “this can’t begin and end with a one-day rally” – “since January, the longest time spend between [Wilmington] shootings is 13 days” – “we need to change our community.”  Gun violence is a tragic problem, but curtailing self-defense rights is not the answer to it. 

7/18/13, B1/B2, Shared grief unites faiths; Religious leaders, more than 100 attendees pray for Trayvon Martin, US, Nichole Dobo – At the Bethel AME Church yesterday (a lunchtime worship service), the congregation included many faiths (about two dozen of Delaware’s religious leaders), ethnicities and races.  “They prayed in unity for the late Trayvon Martin, his grieving family and the country.”  And comments were made about how discrimination remains present in America and the community of faith must help to find a solution.  The effort was compared to the role that religious leaders played in demanding racial equality during the 1960s.   Two more events are being organized: (a) rally outside the federal courthouse on King Street, Saturday at noon; (b) “people are expected to gather in Rodney Square to continue the conversation,” Sunday, 6 p.m.  The comparison to protests in the 1967s is a real stretch, and some of the current protests of the Zimmerman verdict have fanned the flames of racism instead of promoting mutual understanding.

7/17/13, A1/A5, Refinery can claim victory in round 1; Board tosses out challenge to new rail operation, Jeff Montgomery – Previous coverage of the environmental challenges to transportation infrastructure and operations at the Delaware City refinery has laid out the issues in detail.  In essence, environmental groups are trying to come up with legal challenges to the refinery that would seriously impact its economic viability – never mind that the refinery is being operated under state regulation in compliance with the deal that was made to entice PBF into buying and restarting the previously shuttered operation.    Yesterday, the Coastal Zone Industrial Control Board rejected a complaint based on an alleged failure to consider the application of the Coastal Zone Act to transportation infrastructure.  The purported basis was that 16 Delaware Audubon and Sierra Club members who supported the appeal lacked standing to bring it. Environmental groups are said to be worried that “the decision will set a precedent that gives state regulators freedom to approve Coastal Zone projects without traditional public reviews.” As Amy Roe of the Sierra Club put it, “We’re disappointed that it came to [an issue of] standing since so many of our members are impacted and submitted affidavits.  We’ll regroup and think about next steps on this.”  See our previous comment: “Seems to be assumed that the Sierra Club, et al. have standing, but have they demonstrated any economic interest in blocking the refinery facilities?” DNREC refinery rulings fought; Del. City rail, barge permits under fire, 6/12/13. But we never thought the CZIB would have the chutzpah to apply the Coastal Zone Act appeal provision (“any person aggrieved”) so restrictively in a proceeding with this degree of public notoriety.  An appeal re standing seems likely, and we think it should be a slam-dunk.  On the merits, however, we would be inclined to side with PBF.

7/16/13, national “conversation” about the Zimmerman verdict continues – (A) Holder reviewing evidence; Justice Dept. looks at possible charges, A1/A4, Pete Yost (AP) – Speaking to members of an African-American sorority, the attorney general expressed sympathy for Trayvon Martin’s family as a result of the “tragic, unnecessary shooting” of the black teenager.  He assured the group that the Justice Department will follow “the facts and the law” as it reviews evidence to see whether federal criminal charges are warranted.  The only demurrals come from quoted experts who paint a picture of how difficult it would be to win such a case if DOJ did bring charges.  Aside from the Zimmerman family, no one is quoted re George Zimmerman’s likely innocence and/or the ordeal that he and his family have been through as a result of the criminal trial.  (B) Being eyes, ears – only; Fla. Case has line area groups don’t cross, B1/B2, Andrew Staub – Story recaps interviews with Delaware crime watch groups, who reportedly “believe the case will have little impact on the way they help police nab local lawbreakers.”  Why?  Well, in Delaware there is “a longstanding guideline that private citizens leave confrontations to trained officers – unlike what happened in Sanford, Fla. during a rainy February night in 2012” when “Zimmerman, a neighborhood watch captain, got in a confrontation with the unarmed 17-year-old that night and fatally shot him.”  True, a jury acquitted Zimmerman of murder [also manslaughter], but “Martin’s death should serve as an educational moment of what can happen when civilians cross the line into duties best handled by trained law enforcement officers.” Why did he get out of his car?  Why was he carrying a gun (OK, he did have a permit, but he still didn’t have to be armed with anything except a pencil and clip board)?  There are many questions about what happened, and Zimmerman’s explanations are not necessarily dispositive, but this summary of what happened leaves out the strong possibility (based on the evidence) that Martin attacked Zimmerman rather than the other way around. (C) Get politics out of shooting case, editorial – plus four letters from pundits at USA Today and the Washington Post and two cartoons – takes up an entire page (A-8).  The not guilty verdict is said to show “a clear split in public opinion, one that follows political ideologies and racial attitudes.”  The editorial states that (i) Mr. Martin’s  “death was a needless tragedy,” and (ii) “Mr. Zimmerman’s activities on patrol were questionable and probably culpable.”  However, it is suggested that the criminal offense was overcharged, i.e., this probably should have been a manslaughter case versus a murder case.  Although the defense did not rely on a “stand your ground” argument, state laws of this nature should be examined because “too many of them have actually produced a preponderance of cases that critics fear: white gun owners shooting young black men to death.”  However, forget the civil rights charges that DOJ is reportedly looking into, because “political moves from the federal level” would make it “that much harder” to heal the fracture that has been created.  The accompanying letters basically argue about whether Martin was properly (Dewayne Wickham & Eugene Robinson) or improperly (Rem Rieder, Jennifer Rubin) set up as the “victim” in the popular and media storyline of this case.  We agree that this case should not be politicized, but such a purpose is hardly furthered by this presentation. The evidence was presented and ably argued by the attorneys, the judge instructed as to the law, and the jurors rendered a verdict.  That verdict, as the president stated initially, should be respected – not treated as irrelevant. And if a “guilty” verdict had been returned, would a public debate of similar intensity be going on?  The answer, obviously, is NO.

7/15/13, “Not guilty” verdict in Zimmerman case sinks in – News Journal covers the case from a number of angles, both technical and emotional.  Many people were disappointed by the result – whatever its legal merits – mirroring the impassioned demonstrations and demands for “justice” last year after the shooting death of Trayvon Martin. “Community members use demonstration for soul-searching and a call for local activism,” Esteban Parra, News Journal, 3/28/12.  One of the current stories (“In Delaware, criticism and praise,” Kelly Bothum & Gordon Brillon) greatly overstates the importance of Florida’s “stand your ground” law in this case – it is hardly relevant when a person is pinned to the ground and being pummeled by a physically larger attacker – quoting one Delawarean that “if George Zimmerman had been tried in Delaware, he would have been found guilty.  The problem is with the law.”  The Department of Justice is reportedly considering civil rights charges against Zimmerman, although some sources say this would be a stretch because of the paucity of evidence that Zimmerman was motivated by racial animus.  Possibly the Martin family will bring a wrongful death suit, although Zimmerman probably doesn’t have much in the way of assets to go after.  A rather gloomy picture is painted of George Zimmerman’s future.  “Advice to Zimmerman: Hide,” Tamara Lush (AP). This is a sad story, however one looks at it.  Nevertheless, it seems to us that the judicial system worked and Americans should take some satisfaction in that.

7/14/13, A21, Do unto Exxon as you would do unto yourself, Stephen Carter (Yale Law professor) – Writer references a climate change resolution adopted recently by the General Synod of the United Church of Christ, which “has gathered mostly admiring attention from the news media.”  Thrust: (a) divestment of church funds, including pension money, from “fossil fuel companies” unless they meet certain benchmarks, and (b) call for church members to “make shareholder engagement on climate change an immediate top priority for the next five years” and to “demand action from legislators and advocate for the creation and enforcement of carbon-reducing laws.”  Notice, however, that most of the onus for supposedly harmful energy use is placed on suppliers rather than consumers. “True, there is a general exhortation to the UCC’s members to ‘make lifestyle changes’ [in order to] reduce the use of fossil fuels, our carbon footprint, and our complicity with the fossil fuel industry.”  But such language falls far short of treating supply and demand as equally culpable.  If the churches were serious, why not begin charging for parking at their parking lots – or eliminate the lots altogether – with the idea of motivating parishioners to carpool or use public transportation.  How perplexing “that a church should take the view that it’s perfectly fine to demand regulation that might hurt working-class coal-mining families in West Virginia, but wrong to inconvenience its own members even slightly.” One might even call this hypocrisy, akin to Al Gore flying around the world in his private jet to deliver climate alarmist speeches.   

7/13/13, A1/A2, Bloom makes first fuel-cell servers in Del., Aaron Nathans – The Newark factory is not finished yet, but Delaware-made “Bloom Boxes” have been placed in service already at one of two sites for its Delmarva Power generation operations.  Part of the motivation, apparently is to allow the company “to draw additional surcharge revenue from Delmarva customers.”  The average residential customer is reportedly expected to pay $2.07 in July in surcharges, which exceeds earlier estimates of what the surcharges would be.  Apparently, the earlier estimates were not based on “the actual size of the surcharge, but “the premium ratepayers are expected to pay beyond what they would otherwise have paid to satisfy Delmarva’s renewable energy purchase requirements with less expensive alternatives.”  In other words, the fuel cell power is even more expensive than wind or solar power?  Rep. John Kowalko (D-Newark) is now said to be worried that costs will “increase further still as the size of the electrical project builds toward its full capacity.”

7/9/13, A1/A5, PBF monitoring Canada tragedy, Jeff Montgomery & Mellissa Nann Burke – PBF is reportedly following the deadly train accident in Canada closely and reviewing safety details with rail carriers (primarily Norfolk Southern, which declined to comment and “referred questions to the Association of American Railroads”) bringing crude oil shipments to the Delaware City refinery.  No wonder, when “some national and local groups said Monday that the accident highlights inadequately examined hazards created by the rapid expansion of North American crude oil shipments by rail and pointed to a need for reform.”  There was a local accident on April 3, by the way, in which a passing Norfolk Southern train sparked a fire in the woods near the home of Paul and Karen Wittland of Bear.  Before the fire was extinguished, it burned down a storage shed full of lawn equipment, destroyed 100 feet of wooden fence, and melted vinyl siding on the Wittlands’ home – total damage estimated at $25K.  But as the accident in Canada makes clear, devastating accidents are possible – even though the AAR says “99.9977% of all rail hazmat shipments reach their destination without a release caused by train accident.”  And many Delawareans live pretty close to the Norfolk Southern rail routes.  According to the schematic on page 1, there is an “original route to the PBF refinery” (which runs north towards Wilmington, and then back down along the Delaware River) and a “short route to refinery” (runs south through Bear and directly into Delaware City).  Disappointingly, nothing further is said about the relative merits of these two routes.  Also left out is the safety advantage of building more oil pipelines, such as the Keystone pipeline, versus relying so heavily on rail transport.  Can environmentalists think, Bret Stephens, Wall Street Journal, 7/9/13.

7/8/13, A5, Refinery seeks dismissal of environmental challenges, Jeff Montgomery – The filing of a Coastal Zone Act challenge to transportation operations in the vicinity of the Delaware City Refinery was front-page news (6/26/13, Rail deliveries of crude oil threatened).  PBF’s answer is reported on page 5. The defense claims that state and federal interstate commerce laws bar the claims.  It’s also argued that the environmental group plaintiffs failed to show they were harmed by the DNREC decisions or actions in this case, and that the Coastal Zone Industrial Control Board lacks authority to consider appeals from an air permit proceeding.

7/8/13, A9, Abolish food stamps; find a better way to help poor, Charles Lane (Washington Post) – After laying out the difference of opinions between the two parties on this issue - Democrats wants to keep the expanded SNAP (aka food stamps) program “pretty much as is” while Republicans want to cut it “by at least $20 billion over the next decade” – Lane suggests that there is a solution that should make everyone happy.  Abolish food stamps, which admittedly is a cumbersome program that fails to give recipients what they prize above all else, namely cash, and in return “distribute the SNAP budget among other programs for the poor, for which many SNAP recipients also qualify.”  Supposedly, “all the money would go to low-income people who are either working, jobless through no fault of their own, elderly or disabled.  If they aren’t the ‘deserving poor,’ who is?”  Seems to us that welfare payments do erode work incentives, thereby trapping many of the recipients in long-term dependency.  Also, the government simply cannot afford all the welfare programs that are being set up or expanded far beyond their original intent – so cutbacks will be necessary.  Some food stamps history and where to now, 4/29/13. [blog entry]

7/8/13, A11, Flood subsidies should come to an end – Editorial takes position that recent legislation “that would relieve taxpayers of some of the burden of supporting other people’s beach houses” should not be revisited in wake of the “Superstorm” Sandy losses and rebuilding bills that are coming in.  “In effect, the taxpayers were subsidizing many properties that were too close to the water.”  Then, when the Federal Emergency Management Agency (FEMA) came out with revised maps of flood-prone areas, the protests grew.  But “changes must be made,” because “the number and severity of hurricanes and other storms are increasing” – ditto the cost of repairs – “and population movements and rising construction costs are taxing an already outmoded flood management policy.”  Why should risky areas be developed in the first place? As “the geographer and environmentalist Gilbert White once observed: ‘Floods are acts of God, but flood losses are largely acts of man.’”  So the revised law rightly “pushes more of the costs onto the people who benefit from this development,” and “eventually will remove the subsidies.”  SAFE has disagreed with a lot of what the NJ has said about coastal flooding, etc., but not this time (except that the number and severity of coastal storms is not necessarily increasing, suffice it to say that such storms will continue to occur.)  Indeed, we would go further and terminate federal flood insurance, thus stopping the political bickering about identifying flood-prone areas, etc.  By the way, your faithful scribe’s father corresponded with Gilbert White in the 1930s – and thought very highly of him - as recorded in my dad’s autobiography.

7/8/13, A1/A6, Community in ruins; Similar oil delivered to Delaware City Refinery complex, Staff and wire reports – A deadly train accident in Quebec, Canada, involving multiple cars carrying crude oil, “destroyed a busy downtown district and killed five people [death toll will almost certainly go higher].”  The cause of the accident remains to be determined, but apparently involved a string of 72 cars in a stopped train getting loose when the brakes were released and/or failed and running away down hill towards the center of town.  This accident is linked to controversies in Delaware re the growing volume of oil transport by rail – both light domestic Bakken crude and oil sand crude from Canada that is expected to reach 80K barrels a day by next year.  Expect to read a great deal more about this subject, which will be endlessly reprised by environmentalists!

7/6/13, A8, President’s global warming folly ignores reality, Charles Krauthammer – The economy – Syria – a 29-year old hacker – so how does the president respond? Why, he delivers “a grandiloquent speech on climate change,” which “lies at the very bottom of a list of Americans’ concerns” (Pew Poll, 21 issues).  The writer goes on to poke a few holes in the speech: global temperatures have been flat for 16 years – computer models can’t explain this so the science can hardly be said to be settled – rather presumptuous to sneer at the flat-earth know-nothings.  And even if the manmade global warming theory was precisely right, the president’s “massive new regulatory and spending program” wouldn’t fix things.  The US has cut carbon emissions, but China and India are going the other way so the global warming is certain to continue.  There is no point in the US “committing economic suicide to no effect on climate change, the reversing of which, after all, is the alleged point of the exercise.”  Here “is the starkest of examples of belief that is impervious to evidence.  And the word for that is faith, not science.”  We don’t know whether the president believes in the manmade global warming theory or simply finds it politically convenient.  But either way, the result is the same. 

7/5/13, A10, Too much politics at play in health[care] drama – How to explain the delay in implementing the employer mandate under GovCare?  “It was hailed by business owners and Republicans as a sign of the act’s failure.  It was explained by the Obama administration as a technical correction.  In reality it was a political move [that] puts off the implementation of one of the most controversial problem[s] until after the 2014 election[s].”  It’s not that the employers concerned were fixing to drop their healthcare plans, according to the NJ, but a number were going to cut employee hours so lower level employees would not be counted as full-time employees under the 30-hour rule.  “But this raises the question of blowback.” What if the public gets tired of the wheeling and dealing and “gives up on the whole program?”  Probably too much to hope for a reprieve, as the president and his party will fight any moves to get rid of GovCare, but a majority of Americans soured on this legislation some time ago according to public opinion polls.

7/5/13, A11, Lessons for Delaware in Obama’s climate policy, Chad Tolman – Speaking on behalf of “those of us in the environmental community who believe that the closely related subjects of energy and climate change are the most important issues of our time” [emphasis added], the writer recaps the president’s climate change speech in glowing terms.  Tolman goes on to urge that money raised from ending “tax breaks for large oil companies” should be used “to support the coming necessary transition to a carbon-free energy economy.”  He thinks “Delaware should become the US leader by reducing its carbon emissions to the lowest of any state in the country (California and New York are now ahead of us), and by attracting clean energy businesses and jobs to come here.”  Such leadership “is not only necessary for our economy and health, but for our very survival.”  And the League of Women Voters of Delaware and Delaware Interfaith Power and Light are co-sponsoring public information meetings in September during Sea Level Rise Awareness Week – Sept. 14-22.  “Plan to come and learn.” For a different take on the president’s speech (and by extension Tolman’s pitch), see “Sorry, but the economic basics still matter,” our 7/1/13 blog entry.

7/3/13, A1/A7, Biden appeal heard in Fla.; Del. wants voice in healthcare funding, Sean O’Sullivan – As previously reported (three stories in 2012, e.g., Florida vs. Delaware; As Nemours shifts focus south, will the First State be the big loser? 10/14/12) the Delaware Attorney’s General’s office led by Beau Biden is suing in Florida based on claims that the A.I. du Pont trust is being administered in a manner that gives too little regard to the needs of Delaware children (and maybe even Delaware seniors).  Yesterday, a Florida judge heard 90 minutes of arguments about the issue.  Attorneys for the Trust and the related Nemours Foundation (which distributes the trust’s money) “argued in emotional and sometimes personal terms against allowing Biden’s request to reopen the case.”  One of the attorneys told the judge that “Biden’s actions are a purely political ploy” and the Delaware AG’s office “want[s] to run the trust” versus allowing the trustees to do so.  For his part, Delaware’s representative (John MacDonald) charged the trustees engaged in “fraud” by persuading a Florida judge in 2004 to change how the trust was structured and dilute the number of Delawareans in a position to make financial decisions.  Supposedly, the Delaware AG’s office was not notified of the changes and only recently found out about them.  It is claimed that the changes “substantially hurt children in Delaware by, among other issues, reducing the eligibility to receive health[care] services from those 21 and younger to those 18 and younger.”  The trustees note that in accordance with a 1980 settlement, at least 50% of the trust’s proceeds are spent in Delaware annually.  Nemours and the trust were joined by the Florida AG, who argues that Florida – not Delaware – legally represents sick children who stand to benefit from the trust and has “no issue with the 2004 restructuring.”  Outside of court, another Delawarean (Chief Deputy AG Ian McConnel) called the political charges “outrageous.”  He also denied that Delaware wants to run the Florida trust; they simply want to have oversight.  A ruling is expected in due course, but the judge did not signal how he is leaning.  We continue to believe the Delaware AG’s office has overplayed its hand on this issue.  They should be grateful for the assistance that the trust has given in Delaware (over 50% of trust proceeds, as agreed in 1980) and more understanding of unmet needs in Florida and elsewhere.

6/27/13, A1/A7, In long term, weather could be scorching, Jeff Montgomery – “Delaware’s summers will grow hotter, with temperatures closer to the sweltering highs of Savannah, Ga., by the end of the century thanks to global warming left unchecked, a national climate expert told a state panel Wednesday.”  The reference is to Professor Katharine Hayhoe (Texas Tech), who was hired for $46K to produce a report for the Delaware Climate Change Impact Assessment.  Among other things, Hayhoe is quoted to the effect that “if heavy but more efficient reliance on fossil fuels continues, average summer temperatures will gradually move 6 to 11 or 12 degrees higher in this century.”  Meanwhile, the president “announced a multi-point effort Tuesday to curb America’s greenhouse gas output and step up its international efforts, while also supporting preparations for a stormier, changing world.” And an advisory panel in Maryland told Governor O’Malley that the state should be prepared for a two-foot increase in sea levels by 2050.  And in Delaware, DNREC has already recommended planning for about a two-foot rise by 2050 and 3.5 to 6 feet rise by 2100. (Stay tuned for the associated report on options for dealing with sea level rise, which is due for release later this year.)  “Delaware is vulnerable to a lot of these changes that we’re seeing,” says DNREC Secretary Colin O’Mara, and “we need to make sure we have good science driving our decision-making in the years to come.”  For all this outpouring of gloom and doom, global temperatures have not been rising as was predicted – and global warming alarmists have no explanation for it.  Good science must take real world results into account, rather than relying on computer model projections that are no better than the assumptions cranked into them.  

6/27/13, A9, A look at Obama’s plan to fight global warming, Matthew Daly – For those who didn’t read the two stories about this subject yesterday, here’s the same information again in Q&A format.  This report acknowledges that legal challenges to new EPA rules are likely, at least for existing coal power plants, but paints the opposition as technical in nature.  For example, Scott Segal of the Electric Reliability Coordinating Council says previous EPA regulations have had technical and methodological errors that had to be fixed, often under court order.  As for politics, environmentalists have been “irked” by the fact that heretofore the president’s “high-minded goals never materialized into a comprehensive plan.” For their part, Republicans “dismissed the plan announced Tuesday as a ‘war on coal’ and jobs.” Well, forget the GOP – they clearly just don’t get it!

6/27/13, A10, GNP grows 1.8% in Q1; Tax hike leaves consumers less to spend, Martin Crutsinger (AP) – That’s not a 1.8% increase, it is an 0.45% increase (which annualizes to a 1.8% rate of increase), and it’s down from the 2.4% estimate that was previously reported.  Apparently, the only reason anyone can think of for continuing subpar economic growth is the decision not to renew the temporary payroll tax cut.  Furthermore, in terms of policy implications, analysts speculate that the Fed will be slow to follow through on throttling back its QE3 program (purchase long-term bonds in order to hold interest rates at abnormally low levels).  We can think of many other problems, such as failure to approve the Keystone pipeline, proposed new environmental regulations in the name of combating global warming, etc.

6/27/13, Peak-time energy savings to lower bills; Delmarva users can pocket as much as $5 a day, Aaron Nathans – Hey, this is great!  On hot summer days, when everyone is running their air conditioners, Delmarva will be making phone calls (presumably robo calls, or you can opt for text messages on your cell phone) urging customers to consider reducing their energy consumption, typically between noon and 8 p.m., by turning off lights, waiting to run the clothes dryer, or changing the settings on their thermostat.  Get with the program and you could get a bill reduction of as much as $5 for that day, and Delmarva graciously advises that “it will not penalize those who do not participate.”  The program began on June 1, “but during a rainy, cool June, no peak days have been called yet.” We can hardly wait to get our first call!  But seriously, this is just the opening gambit.  This program (using smart meters to monitor power usage) will not remain voluntary for long because “people are like children who need to be told what to do.”

6/26/13, A8/A9, Fed: Del. future bright; Report finds state is poised for growth, Wade Malcolm – Small headshot of Gov. Jack Markell (not mentioned in the story). “After a rare decade of economic stagnation, Delaware’s economy can expect to benefit more than other states as the country rebounds from the Great Recession, according to a report issued Tuesday by a group of economic analysts at the Federal Reserve Bank of Philadelphia.” The report was paired with a panel discussion at UD last night.  Part of the case is that things have been bad so they will probably (regression to the mean) get better.  Delaware’s biggest advantage is being small, so the state can respond with agility to new opportunities – sometimes as a “first mover,” sometimes as a “second mover” who improves on ideas first tried elsewhere.  It has the Delaware Court of Chancery, that’s cool, and a “culture of bipartisan government.” And traditionally, the state has a high percentage of high-wage earning industries, although since the 1990s this edge seems to have disappeared.  Sounds like a rather vapid discussion.  In terms of income taxes, regulations, and government overhead, Delaware is below average.  Its ALEC-Laffer state economic outlook rating in 2012 was 34 out of 50 states, i.e., below average. (download PDF).  And it’s hard to see any signs that the state’s political leaders have a vision for improvement.

6/26/13, A1/A2, Rail deliveries of crude oil threatened; Appeal says operation violates Coastal Zone Act, Jeff Montgomery – This report rehashes previous coverage of the environmental challenge to transportation facilities added at the Delaware City refinery without DNREC going through all the hoops required by the Coastal Zone Act.  New points: (1) The Coastal Zone Industrial Control Board is scheduled to hear “concerns about the operation on July 16.”  And, it is stated, the CZA gives the Board “only 60 days to decide a case,” leaving “little leeway for a negotiated settlement.” (2) The only responsible person speaking up in PBF’s favor is State Chamber of Commerce President Joan Verplanck, who describes the appeal as an “after the fact legal analysis that seeks to declare the refinery’s operations as illegal and shut down its business.”  She adds that an unfavorable outcome for the refinery, after they complied with their agreement with the state government and did in fact create some jobs, could prove damaging to the state’s economic development efforts (i.e., persuading other companies to locate their investments here).  Quoted statements by DNREC Secretary Colin O’Mara are only to the effect that the operations in question were part of an existing operation, and/or a transportation facility rather than an industrial activity.  Why aren’t Governor Markell and DEDO Secretary Allen Levin front and center, explaining how important the refinery is to the state economy and pledging to do what ever it takes to make this challenge to the refinery go away?  

6/26/13, at the federal level, the president proposes a stringent plan for reduced carbon emissisions and support to create more resilient infrastructure(A) Obama takes aim at changing climate, A6, David Jackson (USA Today) – The “climate action plan” was said to be based on “the overwhelming judgment of science, of chemistry and physics and millions of measurements.”  Almost every element of the plan is based on administrative action, because Republicans – described as “major backers of the Keystone oil pipeline and the oil industry” – are not willing to back legislative action.  (B) Obama targets carbon . . . will direct the Environmental Protection Agency to develop standards that limit power-plant emissions of carbon dioxide, A8/A9, Jonathan Fahey (AP) – Stop building coal power plants and effectively shut down most of the existing ones – ease permitting requirements for wind and solar power projects on federal lands – develop new fuel efficiency standards for heavy trucks to go into effect in 2018 - more efficient homes and appliance will reduce energy consumption, offset at least some of the higher costs for electric power.  According to Hugh Wynne, an analyst at Bernstein Research, a 20% nationwide reduction in CO2 emissions “would increased retail power prices by  about 1 cent per kilowatt hour or 9 percent” – and Nick Atkins, CEO of American Electric Power, said that with adequate lead and transition time, the plan could be carried out “without a major impact to customers or the economy.”  We are skeptical about suggestions that such a plan could be implemented with only marginal economic penalties.  No doubt some firms would be winners, however, even as other were severely penalized.  That is what happens when economic decisions are politicized (aka crony capitalism) rather than leaving them to be decided by free market mechanisms.

6/23/12, climate change in the news (it never seems to stop)(A) Obama’s plan on climate to be unveiled; President will announce ideas in Tuesday speech, A1/A2, Josh Lederman (AP) – A “long-awaited national plan to combat climate change” will be unveiled on Tuesday, it was announced on Saturday (video of the president released by the White House).  Environmentalists have been looking for the president to act (as he promised to do in his State of the Union address) due to “a growing consensus that opposition in Congress is too powerful for any meaningful, sweeping climate legislation to pass anytime soon.”  They are hoping for firm proposals including new restrictions on existing coal power plants.  The heck with the economy, or the Constitution either!  (B) Climate change threatens more trouble in the near future, World Bank says, A2, Howard Schneider (AP) – The World Bank is beginning to commit billions of dollars to flood prevention, water management and other projects to help major Asian cities (e.g., Bangkok, Jakarta, and Ho Chi Min City) avoid the expected impact of climate change.  Sea level rise – tropical storms becoming more violent – rainfall becoming both more sporadic and, in the rainy season, more intense – are seen as a “near certainty” over the next 20 years or so as global temperatures move towards the two degree centigrade increase. From when to when would this increase be measured? The climate change issue has become a “main concern” for World Bank President Jim Yong Kim, who sees it as “a chief risk” [evidently there are several chief risks] to alleviating global poverty.  Development bank financing of projects to help poorer countries battle climate change is said to have risen from $10B in 2011 to nearly $25B in 2012, and is expected to continue rising. (C) Problem with Keystone is not the pipeline but the oil it carries, A19, Senator Tim Kaine (D-VA) – The writer characterizes himself as “a pro-pipeline senator,” yet rationalizes opposition to the Keystone Pipeline on grounds that it would carry tar sands oil, which, by most accounts, is 15% to 25% dirtier than conventional petroleum.  Also, the process of extracting and refining this oil is more difficult and more resource-intensive.  “With so many cleaner alternatives, there is no reason to embrace the use of a dirtier fuel source.”  As for the argument that the tar sands oil will be exploited whether Keystone is built or not, “if it were just as easy to ship this oil via road or rail, proponents [of the pipeline] wouldn’t be pushing so hard.” The real alternative to the Keystone Pipeline is a pipeline to the west coast and shipment of the tar sands oil to China, not shipment to the US by rail or road. (D) Purple Martins disprove climate warming gripes, A28, Gregory A. Inskip (Wilmington) – Satellite and surface temperature records show no global warming in 17 years, so a scientific claim that recent warming is causing Purple Martin populations to decline in “some northern areas” (June 19) is dubious at best.  Instead of focusing on the flat global temperatures, global warming alarmists talk about all manner of side issues that are allegedly related to human energy use – floods, droughts, hurricanes and tornadoes, and the endangerment of wild polar bears (which are near their highest worldwide numbers in decades).  Happily, however, Purple Martin population numbers are said to be “stable and growing” here in Delaware. In our opinion, the persistence of the climate change (formerly global warming) theory is not based on science, but rather on politics and money.

6/22/13, A9, Where is Paul Krugman on immigration?  Jan Ting (Temple Law professor) – Instead of taking shots at anyone who dares to question the liberal agenda, notably economic and monetary stimulus to the max and GovCare, Professor Paul Krugman might consider shedding some light on the push for immigration reform designed to bring in more immigrants at a time when this country is having trouble creating jobs for and/or doling out welfare to millions of lower tier Americans.  In so doing, wouldn’t Krugman have to acknowledge that “allowing more poor immigrants into the US will increase economic inequality . . . make the plight of unemployed and underemployed Americans even worse than it is now . . . [and] doom the Affordable Care Act to failure and financial collapse.”  But, “what would all his admirers at the New York Times think?”  We have criticized some of Professor Ting’s other columns, but this one is spot on. 

6/22/13, B1/B3, Carney “hungry” while on SNAP; Trying program gives lawmaker perspective, Kelly April Tyrell – “In an effort to understand what people living on food stamps deal with, this week [Representative John] Carney and 24 other members of Congress are living off of what they can buy using Supplemental Nutrition Assistance Program benefits [aka food stamps].  It’s part of a move to protest unwanted cuts in the program.”  Surprise, surprise, $4.50 a day doesn’t go far these day, and Carney complains of being hungry. Some stats: 1/6 of /Delawareans getting food stamps – nationwide cost (federal) of $81 billion per year – 75% of families receiving food stamps have children under 18, and nearly a quarter have an elderly or disabled family member – nearly half of food stamp recipients live in a family in which at least one person works. What’s the objective here, to continue expanding the food stamp program and bankrupt the government?  See SAFE’s recent analysis, (4/29/13), which concludes that the federal government should block grant the program and turn it over to the states.

6/21/13, A1/A2, Coons joins powerful Senate panel; First Delawarean to serve on Appropriations Committee in 40 years, Nicole Gaudiano (NJ, DC) – “I must say, I’m thrilled,” the senator is quoted, “this is a terrific opportunity for Delaware.”  Coons reportedly envisions that the assignment will allow him to fight for Delaware job opportunities and investments in infrastructure, research, housing and education. But he also sounded a cautionary note:  “ . . . going forward, federal spending is going to have to be more about what we cut than what we increase.” Sounds about right!  There were supportive comments from Senator Barbara Mikulski (D-MD), who chairs the committee, and Senate Majority Leader Harry Reid.    

6/21/13, A11, AARP backs new bill boosting Public Advocate, Aaron Nathans – Instead of doing away with the PA’s office, which has been criticized in some quarters and was up for review by the legislative Joint Sunset Committee, it is now proposed to amend the mandate by adding some words designed to give priority to the protection of “the little people.”  Thus, the PA would be directed “to advocate the lowest reasonable rates for consumers consistent with an equitable distribution of rates among all classes of consumers, provided, however, that the Public Advocate shall principally advocate on behalf of residential and small commercial customers.”  Reportedly, a recent AARP survey found 63 percent of Delawareans age 50 and older said their state elected officials are not doing enough to lower the cost of their electricity bills.  Seven in 10 were unaware that a Division of the Public Advocate existed.  It might be more effective to reverse the state policies that are inflating electric power costs by mandating growing use of renewable energy and conservation vs. capacity expansion?  See the following item.

6/21/13, A14, DP&L rightly favors conserving energy, Jeff Flynn (Wilmington) – This is a rerun of the writer’s 6/17/13 letter with a revised title; the content appears to be identical.  See our previous comments.

6/17/13, A10, Environmental policies benefit customers, Jeff Flynn (Wilmington) – Letter writer responds to John Nichols 6/6/13 column, “When we conserve energy, utility companies raise rates.” It is said the column displays “a regrettable lack of insight into environmental policy” and a “narrow obsession with power prices.”  As an analogy, years ago the car makers were ordered to meet emission standards that resulted in cars being equipped with catalytic mufflers.  “The extra cost was thought to be a worthwhile price to improve the dreadful air quality that plagued cities.”  Similarly, “reducing the impact of greenhouse gas emissions is something we owe our grandchildren,” although it “might” raise the price of electric power “slightly.”  Some environmental regulations are worth the cost; others are not.  The question is where to draw the line.  CO2 is a natural component of the atmosphere, necessary for life as we know it, not pollution. The theory that rising levels of CO2 in the atmosphere (currently .04%) might lead to runaway global warming is highly speculative (although research should continue).  And the price of electric power will be raised quite significantly if the policies to force growing use of renewable energy and conservation are not abandoned.

6/16/13, A2, Climate talk shifts from curbing Co2 to adapting, A2, Seth Borenstein (AP) – The writer goes on and on about how climate alarmists are shifting from a prevention focus to an adaptation focus because it is now too late to stop the CO2 buildup and resulting global warming.  Climate guru Al Gore is quoted, for example, that he was “wrong” in earlier writings (Earth in the Balance, a 1992 book) that “compared talk of adapting to laziness that would distract from necessary efforts.”  What’s left out of the story, however, is that a global warming trend that was predicted to spiral out of control has stopped instead – forcing warming alarmists to shift their attack to extreme weather events, sea level rise, etc.  See a letter to the editor from Bill Morris, which appears in today’s editorial section. “If carbon dioxide is not a significant factor [in causing global warming], we are just wasting money when we subsidize undependable, inefficient energy sources to limit carbon dioxide emissions.  If the climate warms further, the best response appears to be to adapt to the change, as did our ancestors.”

6/16/13, A1/A10, Markell’s refinery moves fuel suspicion; Administration seeks outside legal guidance to defend decisions, Jeff Montgomery – This story basically reprises previous stories about the Coastal Zone Act challenge to rail/barge infrastructure that has been added at the Delaware City refinery.  It sounds like the administration may have trouble maintaining that no CZA permit was required, and there is an implication in this report that Gov. Markell chose to ignore legal advice on the matter earlier.  “A detailed list of the refinery’s potential [CZA] conflicts reportedly went to the [DNREC] in late April, according to several people familiar with the issues raised by the lawyers assigned to DNREC issues in the attorney general’s office.”  Moreover, it is suggested that the purpose in hiring an outside lawyer (Max Waldron) is “to help defend the state’s actions.” An alternative theory, which strikes us as more plausible, is that the outside expert’s advice will be used as cover for the governor et al. to agree that the CZA does apply after all.  DNREC Secretary Colin O’Mara is quoted at some length.  He maintains that there have been no special favors for the refinery in that “every pollutant is down significantly compared to previous owners,” but has declined to get into communications with the AG’s office citing attorney-client privilege.  Professor Samuel Hoff at Delaware State and several environmentalists are critical of how this matter has been handled.  The only person sticking up for the Markell administration, apparently, is Richard Heffron of the Delaware State Chamber of Commerce, who observes that PBF is “not going to do something that’s not profitable [and might] close the refinery down again,” sending “a really bad signal to other companies that are considering operating in Delaware.”  Some observers draw an analogy to “Markell’s handling of a dispute over a HealthSouth bid to build a new rehabilitation hospital in Middletown.” See 4/30/13 story, which among other things reports a decision by the Delaware Supreme Court (overruling the Superior Court) that Broadmeadow Nursing Home had standing to challenge the decision to approve the new facility (which would compete with Broadmeadow).  A closer parallel (not mentioned) would be civic activist John Nichols’s challenge to DNREC’s grant of a permit to Bloom Energy for a fuel cell generating cluster in the Coastal Zone.  An appeal from a ruling that Nichols lacked standing to challenge the DNREC permit under the CZA because he had no pecuniary interest in the matter is pending in the Delaware Supreme Court.  4/20/13 story.

6/15/13, A1/A2, Legal fight set for refinery; Sierra, Audubon file new challenge, Jeff Montgomery – Application has been filed with the Environmental Appeals Board and the Coastal Zone Industrial Control Board to overturn a May 31 DNREC air pollution control permit for one portion of the crude oil supply system (a 45K barrel-per-day barge loading operation).  However, the appeals seek to challenge the incoming rail facilities as well on grounds that the barge and rail facilities constitute an overall bulk product transfer complex, which is barred by the Coastal Zone Act and/or requires a CZA permit that was not obtained.  Widener’s Environmental and Natural Resources Law Clinic (Kenneth T. Kristl) is representing the two environmental groups.  PBF considers the appeal “without merit,” according to a spokesman, and did everything that DNREC told them to do.  He added that “trying to prevent our ability to receive North American crudes at a time when they are integral to our sustainability is tantamount to wanting to shut the refinery down.”  Shutting down the refinery is exactly what Sierra and Audubon would like to do., which in our view is reprehensible. That being said, they appear to have a strong case under the CZA – which rightly or wrong was intended to impose stringent limits on new industrial investment in the Coastal Zone.  DNREC might be well advised to admit they blundered, conduct a hearing, and then issue a CZA permit if they conclude the economic benefit outweighs whatever environmental harm has been shown.  Employee not offended at refinery hearing, A8, Greg Callaway (Middletown) – A 28-year employee at the refinery writes to “clear the air made sour by Jeffrey Montgomery’s” June 5 story, “Fired up over refinery.”  There was no “corporate bullying” to get employees and contractors to turn out for the hearing on PBF’s application for a renewal of the refinery’s overall air emissions permit.  As for the statement that refinery supporters “were acting militant at the rally,” note that “the 80 police officers hired by the Sierra Club did not make one arrest or warn a soul.”  That’s “not how things are done at the Delaware City Refinery.”  Query: Why did the Sierra Club hire all those police officers, and where did they get the money to do so?

6/15/13, A6/A7, Cap and trade raises $124.5M; Regional program holds quarterly auction, Aaron Nathans – This story basically repeats a 6/11/13 story, “Greenhouse gas auction raises record $124.5 million,” with one added detail.  Of the $124.5M total, Delaware’s share was $4.64M.  2/3 of the $4.64M will go to the Sustainable Energy Utility, Delaware’s not-for-profit energy efficiency program, and the rest will go to other state programs like weatherization and low-income heating assistance.  Whee, free money! No mention of whose pockets it is coming out of.

6/15/13, B1/B2, Coons urges action on voting; Supreme Court may overturn part of law, Deborah Barfield Berry (NJ, Washington Bureau) – A section of the 1965 Voting Rights Act has been challenged on grounds that conditions have changed over the past half century and it is no longer necessary, nor indeed legal, to have special restrictions on changes in voting laws of the southern states only.  Either the restrictions should end, argues the State of Alabama, or they should be extended to all states; the southern states should not be treated as pariahs in perpetuity.  A decision is expected by the end of this month, and Senator Chris Coons worries that the Supreme Court might decide the case in favor of Alabama.  If so, he and other Democratic senators (Patrick Leahy, Richard Durbin, and Amy Klobucher are mentioned in the article) feel they “need to be prepared to act legislatively to deal with the likely consequences of a federal government that may be more reined in.”  Granted, however, “passing legislation would require bipartisan support, which could be difficult [impossible?] in the Republican-controlled House.” Hypothetical issue – apparent disdain for judicial branch – unwillingness to change with the times. One might think Senator Coons et al. would find more important things to worry about.

6/13/13, A1/A2, Markell details tax, fee options; Legislators flinch at some ideas, Jonathan Starkey – Offered: “a selection of more than $80 million in tax and fee increases to spend on roads, beaches, parks and waterways.”  Among the possibilities would be a 5¢ per gallon hike in the gasoline tax, for which, however, Democratic leaders in both houses reportedly have “little appetite.”  Other options: higher document fees on car purchases, applying hotel accommodations tax to vacation rentals, hiking car registration fees and highway tolls.  GOP legislators, whose support would be sought to provide political cover for Democrats, complain that this subject is being brought up too near the end of the legislative session – not that they are necessarily opposed to tax increases.  Only recently, the talk was about how to spend a $20M increase in projected state tax revenues.  Isn’t it about time for the state political establishment to learn to spend within its means instead of constantly seeking more revenue?

6/12/13, A1/A7, DNREC refinery rulings fought; Del. City rail, barge permits under fire, Jeff Montgomery – Delaware officials are reviewing their decision to allow the Delaware City Refinery to build a massive crude-by-rail yard outside its Coastal Zone boundary, and have agreed to pay a private lawyer $325 an hour to assist the state as a threat of permit challenges looms.  Similarly, DNREC Secretary Colin O’Mara ruled last month that the Coastal Zone Act didn’t apply to crude-oil barge loading docks along the Delaware River. There were no formal CZA applications or public hearings. O’Mara’s defense: the CZA did not apply because the loading docks were an existing industrial use that did not expand plant operations.  However the barge facility would relay up to 45K barrels of crude oil daily up the river to PBF’s Paulsboro, NJ refinery.  That, insists the Sierra Club, DE chapter, would represent a new and prohibited bulk product transfer activity in the Coastal Zone.  The Delaware Audubon Society and the Green Party of Delaware also have criticized the state’s handling of Coastal Zone matters at the refinery.  Given the challenges, Governor Jack Markell & AG Beau Biden have agreed to hire Max Waldron of Connolly Gallagher to provide “additional experience and expertise.”  Waldron, who reportedly took the job at a 30% discount from his usual fee, was previously involved in Delaware’s multi-year effort to block BP’s proposed liquefied natural gas terminal along the Delaware River in New Jersey.  BP was forced to abandon the project in that case.  Seems to be assumed that the Sierra Club, et al. have standing, but have they demonstrated any economic interest in blocking the refinery facilities?

6/11/13, A6, Greenhouse gas auction raises record $124.5 million, Bloomberg News – The Regional Greenhouse initiative Inc. (RGGI) “raised a record $124.5 million in its quarterly auction of carbon allowances after slashing next year’s supply by almost half.” All of the allowances offered were sold at a clearing price of $3.21, up from $2.80 and it was “the first time in the program’s history that prices increased in two consecutive quarters.” All of which is in line with a previous News Journal story: 2/17/13, Tighter caps may aid Del., Aaron Nathans.  Oh boy, “free money”!  Except, isn’t someone paying higher electric power prices as a result?  Incidentally, other states are at least considering termination of their participation in this type of program.  Will renewables lose their mandates? Marita Noon, Net Right Daily, 6/10/13.

6/9/13, A29, Surveillance warrants Congressional scrutiny, columns by three members of Congress from Delaware re their views on recently revealed mass surveillance activities of the National Security Agency – (A) Balancing two needs is difficult, Senator Tom Carper: Supported extension of the Foreign Intelligence Surveillance Act (FISA) and the Patriot Act on the understanding “that these authorities are needed to prevent terrorist attacks but are kept in check by rigorous judicial and Congressional oversight, all within the bounds of the law.” It is his “expectation” that the Obama Administration “will continue to use these intelligence gathering tools to target only those suspected of serious terrorist offenses, thereby striking a responsible balance between preserving civil liberties and protecting our citizens from those who wish to do us harm.”  (B) For Americans, freedom and safety are not either-or choice, Senator Chris Coons: Voted against reauthorization of FISA because the legislation failed to make “modest and reasonable changes to this law to increase public accountability,” and earlier voted against reauthorization of the Patriot Act for similar reasons.  “The intelligence community should [be required to] provide the public with specifics on the full breadth of information that has been captured under the FISA Amendments Act, and what it is doing with that information.”  There should also be “a framework for declassifying FISA court opinions about warrantless wiretapping activities performed under this law.”  Then there could “a full and informed debate about our nation’s intelligence-gathering procedures and their intrusion on our privacy rights,” as Delawareans deserve.  (C) Liberties must not be sacrificed, Representative John Carney: Voted against “a five-year continuation of several of the intelligence-gathering provisions currently in the spotlight.”  Congress should have first reviewed and amended the laws.  “It’s not acceptable if our surveillance laws are being executed improperly, and Congress should act to stop it.”  For starters, “we need to learn more about the depth and breadth of these surveillance programs.”  Doesn’t sound like the members have much of a clue as to what is going on, yet the idea that the intelligence community will publicly disclose the full breadth of the information it is accessing and what is being done with the information could defeat the purpose of this activity.  The root problem is a growing lack of trust in government, which has been amply justified by recent developments in other areas.   

6/9/13, A17, Nuke plant closures show industry’s struggles, Ray Henry & Michael Blood – Low cost natural gas, thanks to the fracking boom, is undermining the case to build new nuclear power plants.  What’s more, a few existing nuclear power plants are being closed for one reason or another, despite their supposed environmental advantages (no CO2 emissions).  Son Onofre, CA – Closed instead of repairing damaged equipment that “critics said could never be safely replaced.”  Crystal River, FL – Workers cracked a concrete containment building during an attempt to upgrade the plant in 2009, and an attempt to fix the problem in 2011 resulted in more cracks.  Kewaunee Power, WI – Owner wanted to divest, couldn’t find a buyer.  Long-term sale contracts were expiring, wholesale power prices low.  So much for the nuclear power renaissance that was being talked about several years ago!

6/6/13, A1/A11, Defect seen in refinery permit; Groups seek EPA review of state deal, Jeff Montgomery – This story basically reprises the 6/5/13 report on the Delaware City refinery hearing, but with some clarification of the alleged “defect” in the refinery permit and the addition of comments by DNREC Secretary Colin O’Mara.  According to a DC-based attorney (Sparsh Khandeshi) from the Environmental Integrity Project, DNREC erred in granting PBF Energy a blanket emissions cap for nitrogen oxides (NOX) in 2011, thereby freeing the company to modify some existing systems without triggering stepped-up control requirements.  O’Mara defends the state actions, saying that this approach led to lower overall NOX emissions.  He says federal officials were consulted and did not object. Under the overall cap, PBF will be required to reduce NOX emissions to 2,525 tons a year before 11/30/14 and 1,650 tons a year by 12/31/15.  But Khandeshi says “I don’t believe that the state has the authority to make a PAL through a settlement agreement with the facility,” for which reason the EIP plans to seek a federal review by the EPA.  The existence of two regulatory regimes, federal and state, creates complexity and confusion.  And as illustrated here, environmentalist critics are quick to pick the more stringent rule as the basis for their opposition – which is basically driven by a visceral dislike for industrial facilities.

6/5/13, Regulatory creep in the news – If the camel gets its nose under the side of the tent, goes the adage, watch out as the whole camel may soon follow. Consider these examples in today’s news.  (A) Fired up over refinery; about 1,800 attend contentious hearing for air pollution permit, A1/A2, Jeff Montgomery & Robin Brown - PBF Energy is seeking renewal of a major refinery air pollution permit for its Delaware City refinery, and environmentalists turned out at the public hearing to raise issues and press demands.  Amy Roe of the Sierra Club Delaware Chapter described the refinery permit terms as inadequate to protect public health, but reassuringly added that “we are not here to demand that the refinery be shut down and we are not proposing that the state deny the refinery a Title V permit,” just that “the refinery obey the law.”  An attorney (Sparsh Kandeshi) from the DC-based Environmental Integrity Project reportedly questioned state and refinery compliance with federal requirements of plant limits on nitrogen oxide, and also whether PBF’s (i) monitoring of emissions from some major units, and (ii) compliance with requirements for use of open-air incineration “flare towers” might fail to meet federal requirements.  Other environmental group demands: air pollution monitoring along the plant’s fence line, improvements to the plant’s emergency response program, limits on emissions during often uncontrolled startup and shutdown activities, more stringent accounting of air pollution emissions from the refinery’s new crude oil-by-rail unloading complex, and an end to company “intimidation” of citizens traveling [snooping] near the refinery in an attempt to monitor its environmental compliance. Workers at the refinery and other supporters also turned out, and their comments were to the effect that the refinery operation was basically fine and the environmentalists are exaggerating problems and/or distorting facts.  Thus, Arthur Jenson, a reliability and mechanical integrity manager is quoted that “I find the false and misleading information about the refinery to be personally offensive because it so incorrectly portrays who we are.”  Another plant employee, formerly employed at the refinery during the Valero era (which ended with the plant being shut down), warned against “undue hardship being placed on the refinery” in the form of “nongermane and seemingly malignant agendas by a vocal minority.”  From the archives, “Valero nears deal on plant,” Jeff Montgomery, (1/23/10).  Gov. Markell was being lauded for reported deal to reopen the refinery, a development approved of by area residents to bring back jobs to the area, despite restored emissions from the plant.  At the time, SAFE predicted this consensus would not last: “If the deal goes through and the refinery starts back up, they will start complaining about smells from the plant again soon enough.” And noticeably missing from the current article are any forthright comments from the Markell Administration about alleged environmental shortcomings of the refinery operation.  (B) Rent justification bill would bring fairness, A10, editorial – A bill (SB 33) is pending in the legislature, which “would bring an element of common sense and fairness to the thousands of Delawareans living in manufactured home communities.”  It would limit the amount of land rend increases that could be imposed on homeowners, but “this is not rent control like in New York City.”  The bill would simply give homeowners “protection from arbitrary and frequent rent increases” since once the manufactured homes are placed on the parcel it is difficult and expensive to move them.  If the land renters don’t want to pay the increased rent, their only realistic alternative may be to abandon their “mobile homes.”  Senator Bruce Ennis is quoted with approval: It is time for the lessees to have “a degree of predictability, stability and fairness in their lives.”  Maybe this is a reasonable proposal, we haven’t studied the matter, but the distinction from NYC rent controls is a matter of degree versus principle.  And in totality, the trend to bring more and more issues under the ambit of government regulation is not constructive.  (C) EPA sets its sights on eradicating human race, Charlie Hurt, Washington Times, 6/4/13. This column was inspired by a case in which a patient died on the way to the hospital after the diesel-powered ambulance (designed in compliance with an EPA rule) broke down.  The writer colorfully expresses skepticism about the benefits of such regulations, characterizing the agency’s mindset as follows:  “Hi, I’m from the EPA and I am going to help you whether you want it or not. If you don’t let me help you, I am going to fine you until your company goes out of business. I am going to make you jump through endless hoops that do nothing to prevent pollution in the air, land or water. I am going to saddle you with mountains of regulations and paperwork. If you complain or resist, I will fine you some more. In the end, I just may kill you anyway.” Hyperbole, no doubt, but there is a germ of truth here. 

6/2/13, E1/E3, Gas pipeline eyed for Sussex; New fuels could switch NRG plant from coal, Aaron Nathans – Natural gas produced “through a controversial process known as fracking” has resulting in plunging prices for this relatively clean fuel, and now a proposal is being studied for a large natural gas pipeline to serve business needs in Sussex County.  The new pipeline (cost some $165 million) would follow the route of an existing smaller pipeline, minimizing easement and permitting requirements.  Eastern Shore Natural Gas (a subsidiary of Chesapeake Utilities) is talking with some major industrial businesses in the area including major poultry companies, Nanticoke Hospital and NRG (which owns the coal-burning Indian River Power Plant).  State officials are reportedly in favor of the project.  DNREC Secretary Colin O’Mara envisions that gas from the pipeline would power the remaining coal power unit at Indian River with natural gas (which would reduce CO2 emissions) and “perhaps build a new [combined cycle natural] gas plant on the site.”  State Economic Development Director Alan Levin says the Markell Administration has “obviously . . . been concerned about the cost of energy and trying to be as competitive as we possibly can to create economic opportunity in the state.”  If the new CCNG plant was built, this would help drive down the “capacity” line item on electric bills that covers importation of electric power via the grid from other states. Hmm, sounds like the administration has started paying some attention to the criticisms of pro-energy observers.  This is the first time we have read that CCNG power generation is worth considering for new electric capacity.

6/2/13, A20, “Slush fund” for charters will hurt public schools, Rep. John Kowalko (D, 25th District) – Refers to initial funding of $2M for the Charter School Performance Fund that would be authorized by House Bill 165 (see 6/1/13 story), which was allocated in advance of the bill without any public input.  This approach is said to demonstrate “utter disregard for transparency and intellectual honesty,” thereby “further [eroding] any remaining public confidence in the political system.”  The main point of the letter, however, seems to be complaining about the reduced level of state funding for public schools.  The writer says these cuts are creating enormous strains on school budgets and forcing layoffs of educational paraprofessionals, e.g., aides for “special needs” children.

6/1/13, A1/A2, Government trust funds: Medicare OK, but insolvency still in picture, Ricardo Alonso-Zaldivar & Alan Fram (AP) – According to the just released trustee’s report, “Medicare’s giant fund for inpatient care will be exhausted in 2026, two years later than estimated last year, while Social Security’s projected insolvency in 2033 remains unchanged.”  There has been “an overall slowdown in [the growth of] healthcare spending,” and it is said Medicare spending cuts in the GovCare law “are also having a positive effect on the balance, but they may prove politically unsustainable over the long run.”  However, the trustees (photo of Treasury Secretary Jacob Lew speaking at the podium & HHS Secretary Kathleen Sebelius standing to his left) reportedly “urged lawmakers anew to seize a current opportunity and make long-term changes to improve finances” for these program.  Politically, however, the “absence of a crisis” and “lack of trust” could make “legislative action less likely.”  AARP “said it will continue to fight cuts in either program.” The trust fund projection is economically irrelevant – both Social Security & Medicare are already spending more than the dedicated tax revenues at their disposal and there is no money in the trust funds. Whatever savings may be realized on Medicare will likely be more than offset by growing outlays for GovCare coverage.  US medical costs fall?, A6/A7, Kelly Kennedy (USA Today) – According to this story, written before the trustee’s report was released, costs for Medicare/Medicaid in 2012 were 5% less than was projected in early 2010 and the Congressional Budget Office projected May 15 a $618 billion drop in projected expenditures for the two programs over the coming decade.  Also, overall healthcare spending grew about 3% per year from 2009 to 2011 vs. an average 6% per year growth rate over the previous decade.  Among the factors contributing to slower growth in healthcare spending have been the recession (presumably not a permanent condition), cuts to Medicare payment rates (a temporary fix), increased patient cost-sharing (that works!), and increased efficiency by healthcare providers (hard to prove). Entitlement programs still need major fixes, A8, editorial -  The slowing rate of  healthcare spending growth has been due to “the sluggish economy” and “low inflation [that] has kept medical costs from rising too quickly.”  But “that silver lining in this recessionary era could fade as the economy picks up,” so “we cannot stand still on this.”  Suggestions: “Make small adjustments to both Medicare and Social Security that will guarantee their success.”  Also “work to pull down the cost of healthcare,” e.g., cut waste and duplication and get Americans to take better care of themselves. We agree that the problems can be dealt with, and would urge consideration of SAFE’s suggested changes to Social Security ( and the government’s healthcare programs (

6/1/13, Charters focus of House legislation; Schools would have access to more funds, face increased oversight of performance, Matthew Albright, Nichole Dobo, & Jonathan Starkey – House Bill 165 would create a Charter School Performance Fund – not more than $5M per year and subject to state appropriations - that the Department of Education would use “to dole out extra funds to charters it believes have ‘a proven track record of success.’” And charters would get “the same access to conduit bond financing that other nonprofit organizations get,” which might enable the state to “set up bonds that charters could use to pay for building improvements or other projects.”  On the other hand, “any new charter school application or modification would require an impact study” re effects on local traditional schools and the community from which most of the students will be drawn.  Also, charter school board members would be subject to mandatory training in finances and school governance, a “plan to pay all employees through a full fiscal year and a protocol for closing a school.”  The linkage of this bill to the recently played out Pencader saga – the 5th charter school closed in Delaware since the creation of the charter system in 1995 (Richard Milburn Academy closed in 2000, Georgetown Charter in 2002, Marion T. Academy in 2008, Moyer Academy was ordered closed but saved by a special takeover in 2010, Reach Academy nearly closed in 2011) – is acknowledged. The governor supports the bill, and is quoted to the effect that it will enhance the ability of charter schools to succeed.  “Not everyone got what they wanted, but we think this bill is an important step to improving the charter system in Delaware.” On balance, we’re guessing there won’t be many (if any) more charter schools in Delaware.  Too bad!  The public schools lack competition, and it shows in the substandard results being achieved.      

5/29/13, A11, Hospital stay loophole hurts Medicare beneficiaries, Yrene Waldron (Delaware Healthcare Facilities Association) – The writer references a question asked at the May 20 Delaware Aging forum: “What are we doing about the impact that rehospitalization/readmission policies and the use of observation days are having on Medicare recipients?” The writer goes on to cite a Kaiser Healthcare News story that explains the issue. Hospitals have an incentive to classify short-term hospital stays as “observation days” to (a) avoid exposure to findings that a patient has incorrectly classified as an inpatient, and (b) safeguard against readmission penalties if the patient later comes back.  Bad for patients, however, who can unexpectedly get billed thousands of dollars for “observation day” services – and some of them are going to court.  “These Medicare rules make no sense.  Please contract Delaware’s congressional delegation . . . and request their support of [a designated bill] to help Medicare beneficiaries who are hospitalized in observation status.”  *** Lastly, a sincere thank you to the News Journal . . . [for] the thought-provoking Imagine Delaware Open Door Forum Series.  A good example of how overly complex government policies spawn new controversies and more complexity.

5/28/13, dubious policies based on distorted views of the facts: (A) Lawmakers have opportunity to transform voting, A8, Gary May (UD history professor) & Avi Green (Scholars Strategy Network) – Column celebrates history of disenfranchised voters gaining access to the ballot box, but laments that “since the midterm election in 2010, a wave of new laws have been passed by tea party legislatures around the nation,” and Voting Rights Act is “being reviewed by the Supreme Court, and the court may well eviscerate a significant part of it.”  Individual states will increasingly determine “who can vote and who will get excluded.”  Here in Delaware, Governor Markell has commendably proposed Election Day registration (EDR) to ensure no one who wants to vote is denied the opportunity – with the state GOP regrettably standing in “lock step opposition.”  But really, folks, “there is almost no evidence of illegal voting.”  Thus “an extensive study conducted by George W. Bush’s Justice Department found that between 2002 to 2007 more than 300 million had voted, and only 86 were found guilty of voter fraud, and most of them were simply mistaken about their eligibility.”  EDR has worked successfully for decades in ME, MN & WI. Six more states and DC adopted EDR between 1994 & 2012.  CO and CA will soon follow suit.  And states with EDR have experienced 5 to 10 percent higher voter participation in presidential elections.  Other sources report evidence of widespread voter fraud in the 2012 election, which was facilitated by absence of Voter ID requirements and the ballooning use of absentee ballots.  See, e.g., “The voter fraud that ‘never happens’ keeps coming back,” John Fund, National Review, 2/8/13.; (B) How to meet long-term healthcare costs, A9, Dr. Floyd E. McDowell (Delaware Health Security Coalition) – The writer applauds a 5/20/13 editorial re long term care, which concluded that “experts” can design a workable system given “the leadership and political will.”  So let’s enact the Delaware Health Security Act (single payer), which “would have saved a minimum of 40 percent of our $7 billion [including federal & private sector outlays?] spent on healthcare in our state in 2013” as shown by “more than 70 state and national single-payer research studies.”  What’s wrong with the legislature (only 1/3 support the bill) and the governor, who “support corporate special healthcare interests and not [the] citizens who elected them?”  Why should a “single payer” system be so much cheaper? Government efficiency obviously can’t be the answer.  (C) Congress ready to hit brass for lax standards, A9, editorial - No doubt there are problems in the military due to sexual harassment, but the picture painted here (and by some members of Congress, the secretary of defense, and others) – of  “the military’s inability to face up to the problem of sexual harassment” – seems overdone.  If the military is overburdened with edicts of this nature, what’s going to happen to unit cohesiveness and military readiness?  “Hagel orders review of sex-abuse prevention,” Washington Examiner, 5/17/13. 

5/24/13, three NJ stories remind us that the government is here to help us (whether we want the help or not) - A1/A14, Sussex delays decision on proposed sea-level rise responses, Jeff Montgomery – “In a symbolic blow to state climate change adaptation efforts, the Delaware county with the most at stake in future sea-level rise [SLR] forecasts abruptly declined to take any stand on the issue Thursday as a state panel approved dozens of recommendations for dealing with the threat.”  Jeff Shockley, a Sussex County delegate to the Sea Level Advisory Committee said local officials instructed him to abstain from voting on any of “the roughly 60 options developed by the group over a 2-1/2 year period.”  Oh well, the rest of the committee members steamed ahead and the completed recommendations will go to DNREC Secretary Colin O’Mara “after a final report-signing meeting in August.”  This timetable notwithstanding, it seems government officials already know what the report says. “Hours later, Delaware’s congressional delegation announced $20 million in National Science Foundation grants.  Key subjects: the effect of SLR and soil contamination consequences - renewable energy technologies, such as offshore wind and workforce development - new sensors for environmental monitoring.   And the DNREC secretary responded to the Sussex County decision in a written statement.  “The science is extremely compelling and we have many vulnerabilities that need to be addressed in the years ahead *** we look forward to continuing to work with Sussex County to help improve community resiliency to extreme storms and sea-level rise to prevent millions of dollars in future damage.” Skepticism about the SLR scenarios surfaced at a Sussex Council briefing earlier this month.  Sam Wilson (R-Georgetown) reportedly said people predicting a major acceleration in SLR “have no facts . . . no science.  It’s almost BS, to be honest with you.”  But Joan Deaver (D-Lewes) said residents and land buyers need to be told about risks.  For our view, see SAFE Newsletter, Fall 2012, B1/B11, Forecaster say prepare for a busy summer; Conditions ideal for more, stronger storms, Molly Murray – Two Colorado State climatologists previously predicted that this year would see an above average level of hurricane activity.  See 4/11/13 front-page story.  Now the National Weather Service has released its predictions, which are said to be even worse – 13 to 20 named storms, 7 to 11 hurricanes, and 3 to 6 major hurricanes with winds exceeding 110 mph. Time will tell what happens, but the real question is whether the hurricane activity is linked to manmade global warming.  Kind of tough to make that argument when global warming has stalled in recent years while hurricane activity fluctuated in response to other factors. B9, Report says floods still top threat to Delaware, Jeff Montgomery – Can you guess what the latest update of the Delaware hazard report identifies as the top threat?  The First State stands “to lose billions from floods or hurricane winds in worst-case, once-in-500 year storms.”  Hurricane winds pose the second-greatest threat in New Castle County; downstate the number two risk is drought.  The statewide report must be updated every three years, as “part of a national readiness program that helps guide disaster prevention and readiness plans at all levels of government.”  And the job must get done to maintain the state’s eligibility “for millions in federal grants for a wide range of disaster prevention and recovery projects.”  Thus, Delaware Emergency Management Agency head David Carlson says the statewide plan assured Delaware’s eligibility for over $300K of federal funds to relocate a flood-battered sewer line over Christina Creek and use Hurricane Sandy relief subsidies to help Sussex and Kent counties develop hazard studies.  However, no members of the public attended a public briefing on the update of the state plan. The symbiotic relationship between federal and state government helps to ensure the continuing growth of government.  Net public benefits, if any, are secondary.

5/22/13, A11, The heavy load the IRS carries on its shoulders, [Temple Law Professor] Jan Ting – The writer likens 501(c)(4) organization to “for profit” advertising agencies. Why should they be exempt from tax on their income just because they are publicizing political issues vs. trying to sell goods or services?  Donors to 501(c)(4) organizations are not allowed a tax deduction, whereas advertising agency commissions are deductible.  It might be more appropriate to view the “revenue” in question as nontaxable gifts.  Under the law that Congress has seen fit to put in place, the IRS must make determinations that do not have much to do with its tax collection mission – namely, is a given nonprofit primarily promoting “social welfare” or engaging in political activities?  IRS abuses in this area resulted from “a ham-handed attempt to cope with dramatic increases in applications for 501(c)(4) status following the 2010 Supreme Court decision recognizing political spending as the constitution equivalent of free speech” by subjecting organizations with “Tea Party” or “Patriot” or other indications of conservative political intent in their names to “detailed requests for additional information” and “prolonged inaction” on their applications.” The suggested lack of political motivation has been rejected by the IG report, not to mention many conservative critics.  Even the president called the IRS conduct “inexcusable.”  So let’s change the tax law and refocus the IRS on its primary mission versus reviewing eligibility for targeted tax credits like the Earned Income Tax Credit, enforcing GovCare penalties, etc.  Amen!

5/22/13, A10, Questioning level of CO2 in earth’s atmosphere, Chad Tolman (Wilmington) - “As a scientist and member of the Delaware Sea Level Rise Advisory Committee,” the writer responds to a May 20 letter that questioned the alarm bells being sounded about the increase of CO2 in the atmosphere to 400 parts per million.  First, information as to CO2 levels prior to the start of direct measurement are based on air bubbles in Antarctic ices cores that show the level was less than 250 ppm – for more than 800K years – until the Industrial Revolution began about 1750 and humans began burning coal for steam power.  Second, as reported by the New York Times, geologists have reported that the last time CO2 was 400 ppm was about 3 million years ago at a time when sea levels were 60 feet to 80 feet higher than they are now.  So “if we keep burning fossil fuels and increasing the concentration of CO2, it is only a matter of time until half [of Delaware, with an average elevation of only 60 feet] is under water.”  Compare this Washington Times editorial, which asserts among other things that there have also been higher CO2 levels during glacial periods.

5/21/13, A1/A4, Imagine Delaware Forum: Panel kicks off dialogue on aging; Coping with challenge calls for coordination, Kelly April Tyrell & Molly Murray – More than 150 people attended the 90-minute forum, but apparently none of them asked any questions.  This report merely recaps what they were told: GOV. JACK MARKELL – The most pressing problem facing an aging Delaware is the healthcare delivery system and how we will pay for it.  The existing system is unbalanced because healthcare insurance will pay a woman living alone for ambulance and emergency room service, yet won’t pay $200 for an air conditioner in her home.  This is being changed in Oregon, and we need to look at similar issues here.  For example, Delaware already has a state rental assistance program for indigent seniors. On the bright side, retirees make positive contributions, e.g., more than 1,600 children in Delaware are being mentored by a “foster grandparent.”  Also, seniors “are generating money in this economy” and we should take satisfaction in this. The governor plans to look into “revising tax breaks now afforded to seniors and exploring ideas such as means-testing,” i.e., raising taxes on well to do seniors (same idea was noted in 5/19/13 story).     DAVID LEDFORD (NJ, FORUM MODERATOR) – Delaware’s Medicaid program faces a $551 million funding gap by 2030 if healthcare costs are not contained.  Note that some 80% of older Americans have at least one chronic condition, and up to half of them have two.  JENNIE CHIN HANSEN (AMERICAN GERIATRIC SOCIETY) – About 43% of us will wind up having Alzheimer’s.  “That’s a whole other segment of our population.”  Telemedicine could enable seniors with conditions like arthritis to stay in their homes longer, but the payment regulations need to be updated.   ED RATLEDGE (UD) – The 0-19 age cohort is “much smaller” than the 45-64 age cohort that will be leaving the workforce.  “We need to have a very serious discussion (about what?).” MURDITH NICKELSON (82-YEAR-OLD PANELIST) She lives on a budget, says “you make do with what you have.”  MEAGAN WILLIAMS (BEEBE MEDICAL CENTER) – Some seniors face hard choices, e.g., “Do I pay for my medication or do I pay for food?” Ho, hum!  Make “gray” future happier with local solutions, A8, editorial - Aging of DE population will “one day . . . create a human and fiscal crisis.”  The crisis “will be worse if we choose not to notice what is coming.”  Needed: more medical workers, especially those skilled in gerontology – new methods of transporting people (driverless cars?) – encourage seniors to exercise to stave off premature decline – safe places to walk – retrofitting older homes and requiring builders to build accessibility features in new homes (problems: add cost, no market demand) – protect older workers from “age-related digs in the workplace” by implementing “policies that stamp out that kind of behavior.”  Don’t worry about the big issues like Medicare and Social Security, because “local officials or the average person does not have much sway over which way those arguments go.”  So with the big issues, we should meekly accept whatever the “experts” or “leaders” decide to do? Welcome to Agenda 21 and the end of the American Republic!  Don’t count out the baby boomers just yet, A9, John Stapleford (DECON First) -  Dr. Stapleford was born in 1946, placing him on the leading edge of the baby boomer generation.  He offers some “simple facts” to rebut comments that the boomers have run their course, etc. and are now facing an unhappy old age.  30% of population, 36% of income after taxes – highest home ownership rates and average home value of any age cohort – pay 43% of federal taxes and 57% of state and local taxes, excluding income taxes – account for more than half of contributions to nonprofits and spend more time volunteering than anyone else – highest voting registration and participation rates – more than half of all out of pocket spending on healthcare – also big consumers of other goods and services – “politicians have to tread carefully” because the present Social Security and healthcare programs are not sustainable indefinitely – but most likely “the battle over scarce government resources will be won at the ballot box” and “baby boomers are still in the game.”  We don’t necessarily follow all this, but the forum would have been more interesting if Dr. Stapleford had been one of the panelists.

5/20/13, NJ unleashes another flood of ink about baby boomer retirees – A Molly Murray story titled “Leading the way in Lewes,” with a slew of pictures, takes up half the front page and two thirds of an interior page.  A full page ad for tonight’s public forum on “The aging of Delaware” identifies the participants: David Ledford (a NJ executive) will moderate; panelists are Governor Jack Markell, Jennie Chin Hansen (CEO, American Geriatric Society), Ed Ratledge (UD survey and demographic unit), Megan Williams (Beebe Medical Center), and Murdith Nickelson (Wilmington senior who lives independently).  There is a slew of other stories and commentary, far too much to want to read, let alone recap.  A few highlights: (1) Efforts are made to give the anticipated aging of the Delaware population a positive spin by celebrating that some seniors are having fun, exploring new interests, and the like.  The real point of the series, however, seems to be planning for the state of Delaware to ensure all these old folks are taken care of.  (2) It will clearly be cheaper for seniors to stay in their own homes than to be moved into nursing homes, and we can attest to the desire of seniors to maintain their independence. (3) People who are growing older should plan for the future – save for retirement needs, move to a smaller home, put in a bedroom on the first floor, or whatever.  If the state wants to run an advisory service on such issues, or encourage employers to do so, that seems fine. But circumstances will continue to arise in which long-term care in an institutionalized setting becomes necessary.  And as noted in a Wade Malcolm story (“The earlier you begin to plan, the better off you will be,” A8), most seniors will never save enough to ensure a trouble-free retirement.  Defined benefit pension plans are quickly becoming a thing of the past, and a 3% per year inflation rate (if the Federal Reserve messes up, this rate could go far higher) adds up, e.g., by cutting an $80K per year lifestyle to a $44K per year lifestyle in 20 years if one is living on a fixed income. (4) The first line of defense has traditionally been family support, but this is dismissed as unfair to the other family members and/or impractical.  Consider this statement in the editorial (“We must stop ducking the cost of long-term care,” A14). “Today the bulk of long-term care is given by families, especially daughters.  This supposedly ‘free’ service comes at a great cost and tremendous personal sacrifice.” Also, “many of the baby boomers who will need long-term care will have no kinship network because of having been divorced, having never married or having no children.” (5) This is seen as leaving government to save the day, but even this solution is not without problems according to the editorial.  “Each year the government will have to add taxes, cut other programs, or move funds from other departments.  *** The cost of paying for the elderly will pit that demand against the needs of poor children and other low-income residents [and education].  So the demographic change will pit the old against the young and the school establishment.” The CLASS Act embedded in GovCare was intended to address the funding problem, but it was so “poorly designed and unworkable” that “the Obama Administration wisely abandoned it.”  A long-term care commission is at work, which will eventually propose some other solution.  And whether the LTCC answer is accepted or not, know that “experts can devise a system that keeps costs low and requires everyone to pay a small share like a real insurance system.”  All that is missing “is the leadership and the political will.”  Several key points seem to be overlooked: It will not be catastrophe if many seniors start working beyond the traditional 65-year retirement age, which was set at a time when people on average were dying younger than they do now.  There are obvious questions about accepting the end of life, which the government should absolutely, positively stay out of – but which individuals and their families must and do consider.  That’s one of the reasons why turning the care of the aging over to the government is a huge mistake.  We do not share the NJ’s confidence that “experts” can devise a long-term care insurance plan that will keep costs low, etc.  In any case, why not fix Medicaid instead of inventing a new entitlement program?   

5/20/13, A1/A13, Tea party energized by recent scandals; Groups take advantage of IRS, Benghazi issues, Thomas Beaumont (AP) – Tea party groups are naturally up in arms about these and other controversies, after all they were among the groups targeted by the IRS.  The suggestion that they are “using” these situations to raise funds and attract new members, rather than simply reacting to them, seems unduly cynical.  And stow the patronizing advice – “Republicans and Democrats alike say the tea party runs the risk of going too far in its criticism, which could once again open the door to Democratic efforts to paint it as an extreme arm of the GOP.” Finally, it’s said “the tax law allows tax-exempt organizations to lobby and dabble in politics as long as their primary purpose is social welfare.”  Hmm, we thought these rights were guaranteed by the First Amendment vs. emanating from the IRS.

5/19/13, A1/A10-A24/A26, Baby boomer tide is rising; Demographic projections show an unstoppable increase in the number of Delawareans over 60.  Will they swamp the state?  Molly Murray & Kelly April Tyrell – This article and related reports represents the buildup for another Delaware Imagine forum – on Delaware’s aging baby boomers – that will take place tomorrow evening at Clayton Hall, UD, 6:30-8:00 PM.  Guess what, the baby boomers are moving on up and “they are redefining what it means to age in America.”  They reportedly want to have more control over their lives, be much more active than their predecessors, and live a long, long time.  And “drawn by lower taxes and cheaper housing, older people from NJ, PA, MD, and elsewhere are moving to DE.  “By 2030, one-third of Delaware residents will be 60 or older.”  But oops, “a 2012 Gallup poll found that only 38 percent of non-retired Americans expect to have enough money for a comfortable retirement.”  And “the growing senior population could cost taxpayers hundreds of millions of dollars a year by 2030,” with “no comprehensive plan yet” to accommodate the situation.  Medicaid – long-term care support – state pensions – etc.  Where’s the money going to come from?  Governor Jack Markell is reportedly already talking about “means testing” tax breaks for seniors such as exempting Social Security benefits and some of their pension income from state income tax.  What a good way to speed the exodus of the well to do seniors to Florida!   Delaware’s “old” future will be both bright and dim, A30, related editorial – “The decline of American industry means that the younger baby boomers are approaching old age with fewer investments, weakened family support and a lack of confidence in the dependability of our political system.”  Watch out for “the cultural generation gap,” because “the overwhelming majority of baby boomers are white.”  Expect them to be “demanding fewer taxes at the same time they are calling for and requiring more services.”  So “our political system will be under severe strain.”  Inadequate government resources at all levels “will increase tensions and test our resolve.”  It will be “our challenge” to make the best of this hopeless situation.  There are no final answers to any of the challenges in life, but the solutions mentioned in the NJ series are unimpressive.  If governments attempt to assume responsibility for everything rather than expecting people to work out some of their own problems, the results will predictably be catastrophic.

5/19/13, A6, IRS probe ignored most influential groups, Ken Thomas & Steve Peoples (AP) - The targeting of conservative groups was mainly the small fry, grassroots organizations.  Would-be campaign finance “reformers” like Senator Sheldon Whitehouse (D-RI) say “the IRS goes AWOL when wealthy and powerful forces want to break the law in order to hide their wrongful efforts and secret political influence.” Who is he talking about?  Well, Karl Rove’s Crossroads GPS and the Koch Brothers Americans for Prosperity for example.  And, yeah, Democrats are aided by Priorities USA (made up of former Obama campaign workers) and American Bridge 21st Century Foundation (research group led by a former adviser to Senator Harry Reid).  Hmm, does this sound like an effort to change the subject?  We agree the current campaign finance laws are a mess, but most of the problems have been spawned by limits on direct contributions to political campaigns. A crackdown on independent groups would just make things worse.

5/17/13, A1/A7, Huge data center eyes UD site; Pa.-based firm plans $1B facility, 290 jobs, Wade Malcolm – Data Centers, LLC, headquartered in West Chester, PA, plans to invest more than $1B (including about $400M for the first two phases over the several years) to build a data storage and management facility at the UD Star campus – adjacent to the Bloom Energy site.  Ground breaking is expected this summer.  Subject to confirming the details, state officials have promised a $7.5M infrastructure grant.  Electric power for the project will come from a natural gas generating system to be provided by Eastern Shore Natural Gas, with excess power sold to the grid.  Newark officials reportedly hope that the additional power source will lower costs for all electric power consumers and make service more reliable in the southern part of Newark.  No worries about CO2 either, because Data Centers CEO Gene Kern is quoted to the effect that “when it burns natural gas, Data Centers will use technology to capture 90 percent of its carbon emissions.”  The question of why DC won’t operate with Bloom fuel cells is not discussed.  And we’d love to know what sort of technology is contemplated that will capture 90% of carbon emissions, and who it is proposed to stick with the cost that would presumably be involved.  You’d think DC would be pitching this project as a renewable energy venture like Bloom Energy did; maybe that will come out later. 

5/17/13, A1/A5, Obama actions do not satisfy Republicans, Julie Pace (AP) – More on brewing scandals, updating previous reports.  The president has named a new acting IRS commissioner: senior budget official Danny Werfel.  However, he has expressed full confidence in Attorney General Eric Holder, so there won’t be any management changes at the Department of Justice (which is at the center of all the controversies in play except the Benghazi attack).   He supported a State Department request for about $1.4 billion for upgraded security at foreign installations, which would reportedly “come primarily from funds that have not been spent in Iraq.” Budget dollars are fungible, so this linkage is meaningless.  And there is no indication that Ambassador Chris Steven’s requests for additional security before the Benghazi attack were denied due to budget cuts.  100 pages of documents have been released re scrubbing of the talking points about the Benghazi attacks, but this disclosure is selective and far from complete.  Congressional Republicans reportedly intend to press on with further investigations and criticism.  Why?  According to this story, they “see the controversies as an opportunity to derail Obama’s second-term agenda.”  And House Speaker John Boehner is quoted that he would “stop at nothing” to hold the administration accountable.  Just get the facts, and let the political chips fall where they may.  See also “Trifecta of scandals is damaging but not disastrous,” A10, Ruth Marcus (Washington Post) – The writer coos that “bad things happen in second-term presidencies, often in clumps,” but, “compared to Katrina, Monica Lewinsky or Iran-Contra, these are distractions, highly unfortunate but by no means disastrous.”  Benghazi – The White House was simply mediating a “bureaucratic squabble between the CIA and State Department,” only puzzle is why they weren’t more upfront about the role they played.  IRS – President demanded resignation of the acting director; no one is going to jail unless stupidity has been made a crime.  AP leak probe – Damned if you do, damned if you don’t.  If there had not been aggressive action to plug the leaks, the administration would have been accused of a cover-up.    

5/17/13, B11, Del. River water intakes targeted; Group says aquatic life threatened, law violated, Jeff Montgomery – A new tactic is being tried in the ongoing campaign against nuclear power and industrial facilities, namely claiming that their use of river water intakes violates the Clean Water Act.  A three-state environmental coalition is demanding a crackdown on the Delaware City refinery, PSEG Nuclear Salem power plant, and PSEG Mercer’s power plan in New Jersey south of Trenton.  Quotes from Maya von Rossum (the Delaware Riverkeeper), and Mark Martell of Delaware Audubon Society, and DNREC Secretary Colin O’Mara who attributes marking time by state regulators on an expectation that the EPA will soon issue new federal regulations on the water intake issue and effects on fish populations.  “Reducing fish mortality is one of our top priorities,” O’Mara said, but he added that “there are many different ways to do that and our goal is to use the most cost effective” to achieve an expected requirement for results about 90% lower than found in operations with uncontrolled intakes.  It’s hard to believe that the heat discharge involved is having the catastrophic effects attributed to it, nor that a 90% reduction in said heat discharge (which has been going on for years at these facilities) could be justified on any rational cost-benefit basis.   

5/16/13, A3, White House releases 99 pages of Benghazi e-mails, Associated Press -  This action was supposedly taken “in hopes of putting an end to an issue that Republicans in Congress have used for months to attack the Obama Administration.”  One of the e-mails from then-CIA Director David Petraeus objected to the final (scrubbed of all references to Al Qaeda, etc.) talking points because he wanted more details released.  “Frankly, I’d just as soon not use this.”  A senior US intelligence officer (not named) reportedly told reporters in connection with this story that (1) there were concerns a more meaningful statement about the Benghazi attack “could prejudge an FBI investigation into who was responsible,” and (2) it was deemed unfair to disclose the advance CIA warning of vulnerability to an attack “without giving the State Department a chance to explain how it responded.”  We fail to see how these disclosures could be expected to put questions about the Benghazi attack misinformation to rest.  One more time, who came up with the phony video narrative and why did the president et al. keep referencing it?   

5/16/13, A3, GOP, Dems challenge Holder over subpoenas issued to AP -  “In exchanges that often turned testy, Holder defended the inquiry while pointing out that he had removed himself from any decision on subpoenas.”  Holder told the House Judiciary Committee that: “It’s an ongoing matter and an ongoing matter in which I know nothing.”  Holder was unable to provide documentary evidence that he had recused himself, nor even to provide the date when he did so.  Also, there was no indication he had informed the White House of the matter, as one might have expected if the feared leaks were a grave national security threat.  Holder has memory loss at hearing about AP investigation, Washington Times, 5/15/13.

5/16/13, A1/A2, Obama ousts IRS head; Decries agency “misconduct,” Stephen Ohlemacher – The president made no public criticism of acting head Steven Miller, but spoke of inexcusable “misconduct” by IRS employees and said new leadership at the agency was needed.  However, “Miller’s departure hardly ends the matter.” Three congressional committees and the FBI are said to be investigating the matter.  For all the fervor to investigate, however, “legal experts . . . said it could be difficult to prove that IRS officials or employees knowingly violated the civil rights of conservative groups.”

5/15/13, A10, Obama must act to end abuses of political power – “President Obama, less than six months into his second term, is deep into three separate scandals.  (I) “The long-unanswered questions of how the administration handled the aftermath of the killing of the ambassador to Libya and three other Americans.  It is becoming clearer that the administration has purposely misled the American people.  But it is a complicated scandal and conceivably the White House could have ridden out the storm.” (II) Department of Justice secretly obtained two months of AP reporter and editor phone records.  Such things have been done before, unfortunately, “but rarely on this scale.”  Press is up in arms, and going forward may be less friendly to the president.  (III) IRS targeting of conservative groups for special scrutiny is “the president’s biggest problem,” and “will most likely prompt a political response.”  Moreover, the IRS misconduct will detract attention from fixing the Internal Revenue Code, which allows 501(c)(4) organizations to keep the identify of their contributors secret.  (A column by Ruth Marcus on the next page elaborates on why this is supposedly a bad idea.)  “This type of organization should not be allowed to exist,” and if the problem isn’t fixed, “our politics will only grow more divisive.”  Still, back to the scandal, investigators need to determine whether existing laws were broken, etc.  “The administration and its supporters cannot dismiss these outrages.  The responsible officials must be held accountable.”  And don’t forget that the IRS will also be involved in enforcing GovCare, and “political poisons can spread.”  What if the president knew, or should have known, about all of these matters?  Is it realistic to rely on him to ensure the problems are fixed?  

5/15/13, A4, Holder said he had no part in AP phone subpoena, A6, Pete Yost – “Attorney General Eric Holder on Tuesday defended the Justice Department’s secret examination of Associated Press phone records though he declared he had played no role in it, justifying the effort as part of an investigation into what he called a grave national security leak.”  Reportedly, the records were for April-May 2012, involving more than 20 telephone lines assigned to the AP. AP’s top executive called the action an “unprecedented intrusion” into the work of journalists.  “At the White House, spokesman Jay Carney said the president had only learned about the phone records Monday through news reports.” Talk about hands off management!

5/14/13, A11, Deficits, debt, spending – myths and misconceptions, Saul Hoffman (UD economist) – Professor Hoffman’s 4/15/13 column hailed the president’s budget proposal as far better than the House budget plan while saying nothing about the Senate budget plan.  Now, in the guise of debunking five myths/misconceptions, he repeats the pitch. (A) Deficits are always bad. Mitt Romney was wrong, and Paul Ryan remains wrong. As economists have understood since the 1930s, “deficit spending is the prescribed medicine to lessen the severity of a downturns.”  Cutting government spending during a recession “is exactly the wrong thing to do.” And even if there is no recession, deficits are fine “when the investments are in infrastructure or human capital.” Sure, future generations will inherit the debt, but they will also inherit the assets that were created.  (B) Government should behave like a household, living within its means and cutting back spending in tough times.  This isn’t even true for households, which go into debt to acquire assets such as a home.  And more importantly, household spending “does not have any kind of macroeconomic impact, but government spending does.”  See the previous point.  (C) We are Greece or will be soon.  Greece overdid it, running “large, regular budget deficits that would have existed even if its economy was at full employment.”  Also, Greece “lacks the institutional capacity to raise tax revenues” and “does not control its currency.”  (D) Government spending is out of control. Perish the thought. Spending was 20.2% of GDP in 1996 and 20.8% (even with the cost of two wars) in 2008, not much indication of growth there.  True, spending rose to 25% of GDP in 2009 and remained well above normal in 2010/11, but it is expected to reach its pre-recession level by 2016.  The president’s budget projects outlays of 21.6% of GDP in 2016, and this spending level may well be exceeded.  Spending on non-defense discretionary programs is at its lowest level since the 1950s. Over time, various domestic programs have been converted to mandatory status. (E) We can sit back and do nothing.  Longer term, entitlement spending could spiral out of control due to rising healthcare costs, so action is needed – and planned - to bend the cost curve down.  The new healthcare law (1) provides “funding for a broad set of experimental ways of paying physicians and hospitals to rein in costs,” and (2) creates “an Outcomes Research Center to evaluate clinical effectiveness and provide improved practice guidelines for physicians.”  Beyond that, my University of Delaware colleague Larry Seidman advocates “Medicare for All,” which would enable this country to replicate the kind of “hybrid public-private” healthcare systems that work so well in Switzerland and Germany.  See Professor’s Seidman’s 5/1/13 column.  In closing: As the debate about the federal deficit, debt and spending intensifies, remember this:  “Not all of what you read and hear will be sensible and some will be utter nonsense.” The distinction between “consumption” and “investment” spending is more a matter of semantics than economic reality.  The main reason for the run-up in US healthcare costs has been government intervention, which can only be offset by the de facto rationing of medical care.  Compare SAFE’s 4/18/13 letter in the Delaware State News.

5/14/13, White House under pressure on several fronts – The News Journal had stories on three developing controversies. (A) House GOP extending Libya probe, A1/A2, Donna Cassata (AP); (B) Obama denounces targeting of conservative groups by IRS, A3, Julie Pace (AP); (C) Government secretly obtained AP phone records, A3; (D) What do Nixon and Obama have in common, A10, George Will.  “If Republicans had controlled both houses of Congress in 1973, Nixon would have completed his term.  If Democrats controlled both today, the Obama Administration’s lawlessness would go uninvestigated.”  Time will tell whether these matters blow over or have a lasting effect, but for now the president and his subordinates have some explaining to do.  And the president’s dismissal of the Benghazi hearings as a political “sideshow” may not help his cause.

5/13/13, A1/A2, Report author absolves Clinton; Diplomat [Thomas Pickering]: Benghazi security decisions made at lower level, Philip Elliott (AP) – “They’ve tried to point a finger at people more senior than where we found the decisions were made,” Pickering, whose career spans four decades, said of [then Secretary of State Hillary] Clinton’s critics.  Pickering and retired Admiral Mike Mullen headed the Accountability Review Board that investigated the Benghazi attack and death of Ambassador Chris Stevens and three other Americans.  Their “blistering report” concluded that security was “inadequate for Benghazi and grossly inadequate to deal with the attack that took place.”  However, (1) why didn’t the ARB interview Clinton in detail about the matter, (2) why didn’t the ARB comment on the rewritten and by now discredited “talking points” that blamed the attack on a spontaneous demonstration against the infamous Mohammed video (“that was not in our mandate,” Pickering says), and (3) did Pickering and Mullen decline to appear voluntarily at the House hearing last Wednesday (yes, says Rep. Darrell Issa; “that is not true.” claims Pickering; it is now planned to subpoena Pickering and Mullen to appear at a follow-up hearing). The ARB report is not above question, in our view, particularly as no one has actually been fired for the deficiencies it reported.  Another important witness will be former CIA Director David Petraeus. (5/12/13).   

5/13/ 13, Give Bloom the same review Fisker deserved, Philip Palmer (Newark) – The writer commends the News Journal for its recent review of the Fisker debacle and suggests that the newspaper should vet the Bloom Energy venture “with the same amount of zeal, but before Bloom goes bust. *** Isn’t it a bit suspicious that Bloom has worn out its welcome in California but managed to convince Delaware that they have a sustainable technology?  In this case, the electricity user is being saddled with a long-term fee to support a potentially non-competitive enterprise.”  See also Palmer’s 4/15 letter, “Stop bashing Delmarva Power for rate increases” that at least are intended to support high quality service to customers.

5/12/13, Benghazi coverage continues, (A) GOP ready to push Benghazi into 2016, Charles Babington (AP) – “Newly revealed communications show that senior State Department officials pressed for changes in the talking points that UN Ambassador Susan Rice used a few days after the Benghazi attacks [due to concerns] that Congress might criticize the Obama Administration for ignoring warnings a growing threat in Libya.  *** The new details suggest a greater degree of political sensitivity and involvement by the White House and State Department [than had previously been admitted]. *** Friday brought a fresh round of conservative broadsides against [Hillary] Clinton, Obama and the administration’s handling of the Benghazi matter.”  Statements by Senator Rand Paul and a video (was Hillary Clinton part of a cover-up?) from American Crossroads are referenced.  We would favor getting to the bottom of what happened and who was responsible.  Premature gloating by the GOP will not help. (B) Benghazi cover-up remains difficult to rationalize, A24, Kathleen Parker – This column focuses on then Secretary of State Hillary’s Clinton “exasperated assessment” during congressional testimony in January.  “What difference at this point does it make?”  Why people decided to attack US facilities in Benghazi is supposedly far less important than preventing another such attack in the future.  And it is easy to believe that real-time mistakes in Benghazi were honestly made.  But still, “the mistakes made afterward, whether out of embarrassment or [for reasons of] political survival, are less easily rationalized.  They were dishonest.” In other words, the media and general public is finally beginning to realize that this was a cover-up.

5/12/13, A17, Despite differences, Americans think a lot alike; Minimum wage, term limits, oil pipeline are among issues with broad support, Connie Cass (AP) – Polls supposedly show that “almost all American consider themselves very patriotic, believe in God, value higher education and admire those who get rich through hard work.”  Similarly, “7 out of 10 people want to raise the minimum wage” and “similar numbers want term limits for Congress, support building the Keystone XL pipeline to bring oil from Canada, and back using government money to make preschool available to every child.”  But the nation’s political leaders are deeply divided.  So, could it be that “the great division in politics these days lies between Washington and the rest of the nation.”  It shouldn’t be a revelation that most Americans have middle of the road views, because the majority of them are not paying attention to policy disputes most of the time.  Also, as is noted in the discussion, some of the “big ideas” that people are said to agree on “may conflict with each other.”  Ask the people who “want to raise the minimum wage” whether they want to pay higher prices, and they may give a different answer.  Our guess is that general public is just as polarized, if not more so, as the politicians in Washington – most of whom are pretty astute at reading the political tea leaves.   

5/12/13, A19, Experts: CO2 record illustrates “scary” trend, Seth Borenstein – This article tracks the Associated Press story, “Greenhouse gas level highest in 2 million years,” that ran yesterday.  Whole paragraphs are verbatim, suggesting that AP and/or Borenstein may be getting paid twice for the same story.  But this version does have some new touches.  Thus, the 400-ppm (.04% of total atmosphere) reading is a peak figure and readings for the year as a whole will probably average around 396 ppm. “World carbon dioxide pollution levels are accelerating” (emphasis added), and  “every second the world’s smokestacks and cars pump 2.4 million pounds of the heat-trapping gas into the air.” This would work out to over 37 billion tons of CO2 a year, which admittedly sounds like a huge number.  However, global warming has stalled in recent years – calling into question dire predictions about the consequences of the CO2 buildup.      

5/11/13, coverage of Benghazi controversy –The News Journal carried two follow-up items: (A) Talking points over Libya under fire; State Department sought to change what was said about deadly attack, A1/A5, Donna Cassata and Julie Pace (AP) – “The latest disclosure Friday raised new questions about whether the Obama Administration tried to play down any terrorist factor in the attack on a diplomatic compound just weeks before the November presidential election. *** Eight months after the attack, the long-running and bitter dispute between the Obama Administration and congressional Republicans on the subject shows no sign of abating.  *** Administration officials said Friday they deleted the references to terror groups because it was then unclear – and still is – who was responsible for the attack.” Whose idea was it to suggest the attack resulted from a demonstration to protest the infamous Mohammed video, a demonstration that according to Greg Hicks never took place? (B) Benghazi hearing recalls ‘90s-era Hillary Clinton, A9, Melinda Henneberger (Washington Post) – This column likens Hillary Clinton’s statements and deportment during the Benghazi controversy to her behavior during a 1990s investigation into the Whitewater land deal.  In both cases, Cheryl Mills was in the picture – she served as a Deputy White House Counsel in the 1990s and was a trusted subordinate during Clinton’s tenure as Secretary of State.  Take no prisoners, don’t admit anything, and fire back at the opposition.  Compare the 1990s reference to “a vast right wing conspiracy” with Clinton’s blast at a hearing in January of 2013 – “What difference at this point does it make?”  Assuming “there’s really nothing to hide,” suggests Henneberger, maybe “some belated transparency would help Clinton put the less savory aspects of the ‘90s behind her for good.”  Interesting comparison, which had not occurred to us but rings true.  

5/11/13, A2, Greenhouse gas level highest in 2 million years, Associated Press – CO2 was measured at 400 parts per million Thursday at a monitoring station in Hawaii.  This is said to be the “highest level in almost two million years – an amount never before encountered by humans.”  And “what we see today,” said a National Oceanic and Atmospheric Administration scientist, “is 100 percent due to human activity.”  Pennsylvania State University climate scientist Michael Mann is quoted that “the speed of the change is the big worry,” i.e., plants and animals can adapt to changes over thousands or millions of years, but “that can’t be done at the speed it is now happening.”  Note that the CO2 level stood at 315 ppm when measurements were first taken in 1958, so the CO2 level is growing about 2 ppm a year. At the end of the article, the following assertion appears: “Carbon dioxide traps heat just like in a greenhouse and accounts for three-quarters of the planet’s heat-trapping gases.”  Some observations: (1) If CO2 levels only began to be measured in 1958, how do scientists know what they were over the ages?  (2) Might have mentioned that this was “only a daily figure, the monthly and yearly average will be smaller.”  Washington Examiner, 5/10/13, (3) Re the 100% claim, humans contribute only about 3.4% of annual CO2 emissions and the effects of CO2 from human and other sources are not distinguishable.  A Global Warming Primer (page 7), NCPA, circa 2007.  (4) The closing paragraph is at best oversimplified. Note that some 95% of the greenhouse gases in the atmosphere are water vapor.  Global Warming Primer, page 6.

5/9/13, A6, Former diplomat in Libya describes consulate attack, Donna Cassata – A factual but rather bland summary of the Benghazi “whistleblower” testimony before the House Oversight and Government Reform Committee, buried inside the newspaper, does not seem likely to excite much lasting interest.  According to the reporter, “the hours-long hearing produced no major revelation[s],” but merely “exposed bitter partisan divisions” between Republicans who “insist the Obama Administration is covering up information” and Democrats who “decry politicization of a national security issue.”  In our view, the “whistleblower” testimony was compelling.  For example, chief of mission (after the death of Ambassador Chris Stevens) Greg Hicks said it was clear this was a terrorist attack from the outset, Mohammed video was a nonevent in Libya, he spoke by phone with Secretary of State Hillary Clinton at 2:00 a.m. on the night of the attacks, and he was “stunned” by the misleading talking points that UN Ambassador Susan Rice parroted on Sunday talk shows five days later.  Compare Susan Ferrechio’s story in the Washington Examiner. Let’s hope this matter will be fully investigated.

5/9/13, A1/A12, Markell signs gun bill; Background checks first to reach his desk, Doug Denison – The new law requires background checks on most private gun sales (presumably similar to the measure that recently fell short in the US Senate).  Several other measures, which reportedly have “bipartisan support,” are in the pipeline.  One-year minimum jail sentence for conviction of unlawfully carrying a concealed weapon – higher minimum jail sentences for convicted felons found in possession of a deadly weapon – broadened ability to seize guns from individuals with relevant mental problems.  The gun seizure bill would require reporting by mental health professionals, but with procedural safeguards including requirement of a court order before the report could be acted on.  According to an NRA representative, “it’s probably the best bill anyplace in the country the NRA has seen to deal with mental health issues,” although it is proposed to raise the legal standard of proof necessary to declare a person dangerous. All in all, we think the push for tougher gun controls is being dealt with appropriately – in marked contrast to the way bills on other subjects have been pushed through the legislature without meaningful review.

5/9/13, A14, It’s time to change the conversation on charter schools, Kendall Massett (executive director of the Delaware Charter School Network) – “Charter schools have gotten a lot of bad press over the last year,” the writer begins, in an obvious reference to the incessantly reported saga of the Pencader Business and Finance Charter School that will end with the school’s forced closure.  But “this is part of the deal with charter schools,” which face heightened accountability as an offset to their relative freedom to experiment with new techniques and approaches.  To have a balanced view, it’s fitting to also report on the success stories.  Did you know, for example, that Newark Charter School and Sussex Academy in Georgetown are two of Delaware’s top schools in the K-8 sector *** Positive Outcomes Charter School making great strides for high needs students with its “Big Picture” school model *** Prestige Academy bucking decades-old correlation between low-income status and dropout rates *** chess program at Thomas Edison Charter School *** Campus Community Charter School students running the Biggs Art Museum in Dover *** Greek language program at Odyssey Charter School *** top three schools in math proficiency in Wilmington are charter schools *** East Side Charter School reaching out to Wilmington Mayor Dennis Williams and other African-American Delawareans *** partnering relationship between Cab Calloway School of the Arts and Charter School of Wilmington *** Brandywine High School adopting the progressive Singapore Math program piloted by Kuumba Academy Charter School.  “Today, in honor of National Charter Schools Week, members of Delaware’s charter community – students, teachers, parents and leaders – are bringing our collective voice to Legislative Mall in Dover at noon. *** I hope we will be heard and I encourage you to listen.” Bad news sells more newspapers than good news, unfortunately, but the News Journal should take this column to heart.

5/9/13, B1/B2, Hot zone risks stressed; Delaware panel hears research findings, Jeff Montgomery – Katharine Hayhoe, a Texas Tech professor and consultant who is labeled “a leading atmospheric scientist” conducted an “Internet briefing” for the Delaware Climate Change Steering Committee.  The gist of her remarks was that “every model [computer simulation] shows it getting warmer” in Delaware and the mid-Atlantic.” Also, expect more rain, extreme weather events, and accelerated sea level rise.   The finger of blame is pointed at manmade carbon emissions, to which “the climate is slowly responding.”  So slowly that there has been no discernible increase in global temperatures in recent years, and climate alarmists are scrambling to explain why their previous predictions have not been coming true. But take heart, because “the higher [temperature] future is not inevitable, and the reason why we are doing these studies is to make sure it isn’t inevitable.”  Delaware State Climatologist Daniel Leathers chimed in that state temperatures have been increasing at a moderate rate for more than a century, rising by nearly 0.2 degrees each decade since 1895.  Also, average spring and summer temperatures have set records recently.  He doesn’t see a clear trend for more rain, but that could change as warming continues.  Thomas Sims, who directs UD’s Institute for Soil and Environmental Quality, suggested that “if temperatures go up by 2 degrees by 2100, many of the things we’ve identified as potential problems won’t be problems or they may be minor problems that we can deal with.”

5/9/13, B3, Minimum wage increase tabled, Doug Denison – 7 of 11 members of the House Economic Development Committee voted not to release the minimum wage increase bill for a floor vote, “likely hampering any chance of the bill passing this year or next.”  Good!

5/8/13, A12, Delaware must weigh tax burdens on small business – The minimum wage is “more complicated than most of us think.” Consider that the state Senate has passed a bill that would raise the current minimum from $7.25 an hour [same as federal minimum wage] to $8.25 by Jan. 1. 2015.  That won’t affect “most businesses,” which “pay more than the minimum wage,” although “one of the biggest current problems with our economy is that many big businesses are not paying their workers enough.”  But “that does not apply to small businesses,” which have “been running tight” and can ill afford “more added expense” on top of rising healthcare and unemployment compensation premiums. “Already, economists are speculating that many small businesses will either shrink their employee base or decide not to hire [more workers] to escape the extra costs of Obamacare.”  In our view, employee compensation levels should be determined by supply and demand – not someone’s notion of what business owners can “afford to pay.”  What’s next, a proposal to raise the minimum wage with a small business exemption?

5/5/13, A1/A17, How Delaware bought a lemon; Early warnings over loan to Fisker emerge after Delaware bet big on hybrid automaker, Jonathan Starkey & Nicole Gaudiano – It really shouldn’t have been that hard to see that the government-supported investment in the Fisker investment was a risky flyer, but this story brings out some warnings from the Energy Department staff in September 2009 that VP Joe Biden, Delaware governor Jack Markell, et al. were either not unaware of at the time or chose to ignore.  In any case, according to this report, Markell and others have “said they wouldn’t have acted any differently had they seen the Energy Department analysis.  Delaware was desperate to resurrect a once-vibrant car manufacturing industry after losing Chrysler and GM.  And jobs were becoming scarce as the nation in 2009 languished in a Great Recession.”  Former Representative Mike Castle (R-DE) was among the supporters for the project, and state Sen. Greg Lavelle (also a Republican) voted for it.  However, Lavelle says the Fisker project was portrayed as a “grand slam” by the Markell Administration. “We were never told this was really risky, never told.  If you’re asking me if I’m qualified to vet a multi-million dollar investment into an electric car, I would have to humbly say I’m not.”  Finally, a good deal of private venture capital was invested in the venture - $1.2 billion according to this article – which will probably be lost in addition to the federal and Delaware state losses.  After Fisker fallout, we still need jobs, A29 -  “A lot of people, it seems, were taken in by the bright promise of “green jobs,” observes this related editorial, but jobs can go anywhere these days and companies “leave when they get a better job elsewhere.”  Makes it hard to be a state official, reduced to scrambling to “create” jobs – which they can’t do anyway, because jobs are created by the private sector and initiatives to create a more favorable investment climate won’t pay off fast enough to satisfy voters.  Note: “quite a few of those who are jeering at Gov. Markell now gave him a cheering ovation when he announced the pact in 2009.”   For the record, SAFE was skeptical about the Fisker venture from the start.  Compare the next story, which is reprinted from the archives.

7/4/10, D1/D3, "Fisker's course uncertain, but Tesla IPO offers beacon," Jonathan Starkey - Tesla Motors raised $202 million this week from an initial public offering and Fisker (which is committed to buy the former GM plant on Boxwood Road) has raised over $300 million from private investors.  Each company has also received about $500 million loans from the federal government.  However, “several questions linger” about the future for “luxury electric car makers” like Tesla (“makes a $109,000 electric Roadster, but has yet to turn a profit”) and Fisker (“has yet to deliver its first product, the $88,000 Karma plug-in hybrid sports sedan to customers”).  Not to mention competition from much lower priced electric cars to be offered by other companies.  Including pictures of the Tesla and Fisker cars, this article takes up about 40% of the first page of the business section – or 50% if one throws in the wind power story. These federal government loans are a spectacularly bad idea, especially when the federal government is in a deep fiscal hole.  So is other meddling in the automotive market (e.g., steadily tightening fleet mileage standards) and energy market (e.g., subsidies and mandates to force increasing use of more costly “renewable energy”) that is going on.  Let’s wake up and demand that the federal and state governments discontinue these ill-advised policies so the free market can work its magic.

5/5/13, E1/E4, PSC staff questions Delmarva Power’s spending, Aaron Nathans – In response to Delmarva’s request for another electric delivery rate hike request that would cost ratepayers $42M per year – only three months after the PSC awarded a rate increase of $22M per year – the PSC staff is actually asking some real (gasp) questions.  Like why does Delmarva Power need to make $397M in infrastructure investments over the next five years, which it will then expect to recover, including a profit element, via rate increases?   It’s said Delmarva’s power reliability has been good, so they would not seem to be playing catch-up in response to customer complaints.  And if Delmarva is given credit for spending $397M over the next 5 years, the monthly bill for “a typical residential customer [1,000 KWH per month]” is projected to increase from $148 to about $200 in five years.  That’s a growth rate of 6% a year, versus considerably lower conventional forecasts for inflation.  Delmarva’s counsel, Todd Goodman, has asked the PSC to deny the staff request for additional information about the proposed investment.  He argues that the PSC staff is seeking to give the commission too much control over company operations. We’re reminded of Philip Palmer’s 4/15/13 letter to the editor on this subject. “Isn’t it interesting,” he observed, “that politicians are having fits over Delmarva Power’s request for a rate increase” but “were either mute or wildly in favor of unilaterally forcing our rates to increase . . . to subsidize Bloom Energy.”

5/2/13, A10, Let’s take a closer look at Pencader and Christina, Barbara Finnan (former public school teacher) – This column claims that Pencader charter school got a $350K bailout to cover its debts (including $85K in legal bills) after it threatened to file for bankruptcy before the end of the school year, whereas the state Dept. of Education is being quite heavy-handed re the Christina School District proposals to use Race to the Top grant money in a way counter to DOE’s wishes.  Not only does there seem to be a double standard at work here, but why is it that “only one of these two districts had any substantial coverage by The News Journal?  That would be Christina School District.”  And by the way, the writer and another interested party met with DOE officials in June 2011, at which time they proposed several ideas (not acted on) to supervise charter schools more rigorously, including “a plan in their applications and renewals that covered any disruption in service.”  Pencader’s problems were reported exhaustively by the NJ – from a 6/24/12 story entitled “The lies behind diploma mills: Pencader head’s [a subsequently fired school leader] PhD highlights concerns over pay-for-degree website” down to recent coverage of the $350K payment so Pencader could complete the school year before closing per the DOE’s order. It’s hard to see that the DOE coddled Pencader in this situation.

5/1/13, A12, Food stamp dependency eating at state of nation, editorial – “Whatever economic progress many hoped would come from the Obama Administration’s emphasis on economically uplifting poor Americans is being wiped out by growing reliance on government assistance.”  It seems that “stubborn recessionary forces” and “intractable political fights in Washington over how to rein in rising federal spending and debt” have “resulted in a failure to concentrate on repurposing the American workforce so that it can be considered a relevant competitor in a global marketplace, where third-world sense of enterprise and entrepreneurship is thriving and increasing gross domestic production elsewhere.”  Also troubling, “the cost of [food stamp] fraud has more than doubled in three years, which raises a question about the efficiency of a government program with 47.7 million enrollees in need of an affordable food source.”  Growth of government benefits has been the Administration’s main strategy for “uplifting poor Americans,” the reference to “repurposing the American workforce” is empty rhetoric. And reining in food stamps and other welfare programs is one of the keys to addressing the fiscal problem, not a goal being neglected due to those “intractable political fights.”  Fraud exists, naturally, but curing it would not solve the problem.  Compare SAFE’s recent analysis. (4/29/13).

5/1/13, A13, Why do we think Social Security, Medicare is at risk? Lawrence Seidman (UD economist)Social Security: “Opinion polls show many young people think they will get little or now Social Security benefits [when they retire, but] this is false.”  (1) Scheduled benefits go up with wages, adjusted for inflation, or about 1% real growth per year. [How do we know average wages will increase faster than inflation, what about statistics showing “middle class” wages are not keeping pace with inflation?]  (2) Future payroll tax revenues may not be “quite” sufficient to pay 100% of the scheduled benefits.  A recent Congressional Budget Office report shows “payroll tax revenues in 2060 will be 80 percent of scheduled benefits so a 2060 retiree will get a benefit that is about 20 percent (instead of 50 percent) higher than today’s retiree” [adjusted for inflation, wouldn’t that mean a real economic loss?].  (3) Over the next two decades, the trust fund that Congress has “built up” since the mid-1980s will be drawn down to pay scheduled benefits.  Then payments will fall to the 80% of scheduled benefits level.  The value of the trust fund is zero because the excess payroll tax collections have been spent, so there is nothing to draw down.   Medicare: No other country in the world spends 18% of GDP on healthcare, as the US does, in fact the highest cost elsewhere is 12% of GDP.  Their secret: “give a greater role to government to be the single payer of medical providers and to bargain hard over the prices and revenues that medical providers receive.”  To achieve similar results, all we need to do is to adopt Medicare for All (a single payer system).  It would be funded by a value added tax rather than by trying to hike payroll taxes.  Healthcare outlays could be cut to 15% of GDP – still three percentage points higher than anywhere else.  And the productivity of the US economy would improve, as businesses and job seekers were relieved of “the distraction of health[care] insurance” and consequently enabled to focus on “improving the productivity of the US economy.”  Other countries don’t achieve lower healthcare costs via greater efficiency of a single payer system; they effectively ration access to healthcare services (except for privileged upper class patients).  As for productivity, the drag effect on the US economy of imposing a VAT on top of existing taxes might seem to warrant discussion. 

4/30/13, A1/A6, New bill supports rehab hospital; Middletown facility called unnecessary, Jonathan StarkeyAlthough not mentioned in this story, a hospital facility (Christiana emergency room) just got built in Middletown.  Now another one may be on the way, this one a freestanding rehabilitation hospital that would specialize in treating patients with brain and spinal cord injuries as well as patients recovering from strokes.  Governor Markell has supported the new hospital on grounds that it would create 80 permanent jobs and encourage healthcare competition.  Broadmeadow Investment LLC, the operator of an existing Middletown nursing home, says the new capacity is not needed. The proposed bill would resolve a legal challenge to allegedly improper influence on the Delaware Health Resources Board, which is tasked with assessing the quality, availability and cost of healthcare in the state before certifying new healthcare facilities.  The Delaware Supreme Court just ruled that Broadmeadow does have standing to sue in this matter.  The argument for a certification process (which the governor et al. apparently want to circumvent in this particular case, but are not proposing to do away with) is that healthcare is a regulated marketplace so a new entrant may cause healthcare costs to rise versus fall.  Thirty other states have a similar certification process.  One more example of how government intervention in an industry leads to a need for more government intervention.

4/30/13, A11, The battle over banks is about to be rejoined, Simon Johnson (MIT Sloan School) Another paean to the supposed merits of the Brown-Vitter banking reform bill which would supposedly cure the “too big to fail” problem.  In a similar vein, see Ted Kaufman’s column on 4/21/13.  According to this article, the big banks have swung to supporting their version of implementing the Dodd-Frank bill of 2010, after Herculean efforts to get it delayed or repealed: “ . . . filing lawsuits, mobilizing international pressure, hiring former regulators, writing opinion articles and comment letters, and commissioning faux research pieces.  It was a tour de force by one of the great lobbies at the top of its game.”  But now the Independent Community Bankers of America are speaking up, and the Brown-Vitter bill offers “a thought-out plan for making the financial system safer.”  Just “read the bill and the section-by-section guidance” that is being provided.  “Intellectually, the tide has turned.” If Dodd-Frank did not solve (or even address?) the “too big to fail” problem, why was that monster bill enacted and what did it accomplish?  Also, what is being done about the erroneous government policies that contributed so significantly to the 2008 financial crisis?

4/30/13, A11, Delaware’s schools lag – and everyone knows it, John Stapleford (Decon First, LLC, - Well, at least everyone knows it except the governor, the legislature, the teachers’ union, and the News Journal.  See the National Assessment of Educational Progress results – 2/3 of public school eighth-graders cannot read or do math with proficiency.  Racial minority or low-income test scores are worse.  And so are results for one-parent households.  Enough money is already being spent, more than $18K per public school student in Delaware, so “let’s not assign blame.”  Let’s “turn to experienced teachers and administrators to brainstorm solutions.” Without a clearer focus, nothing is going to happen. 

4/28/13, A28, What would happen if grown-ups ran government? George Will - This column paints an upbeat picture of pushback against childish moves that are primarily attributed to the president.  (A) Kudos to Rep. Jeb Hensarling (R-TX) for declining to hear testimony from Richard Cordray, the purported head of the Consumer Financial Protection Bureau, as the president’s recess appointment of Cordray appears legally invalid.  (B) Congress resisted the use of flight controller furloughs to punish air travelers for the sequester.  (C) For all the president’s talk, Americans are not warming up to “Obamacare.” (D) Maybe Senator Max Baucus and Representative Dave Camp will join forces to work on real tax reform to ignite economic growth, as neither of them will be in their current tax committee jobs after 2014.  (E) About the Senate bill to tax internet sales, Harry Reid bypassed the Senate Finance Committee because Baucus was against it.  Maybe the House will think better of the resulting $22 billion tax increase as “much of the revenue will be passed on to public employees and, through their unions, to Democrats’ campaigns.”  (F) “Earth Day passed with less notice” last week than was given to Fisker Automotive’s “slide toward bankruptcy.”  Time for Washington to “take seriously the bad news about its harebrained green investments and the good news that refutes the argument for more of them.”  The Washington Post more suitably titled this column: “Courts and Congress give Obama adult supervision.” We generally agree with Wills’s points, although it does seem internet sales should be subject to state sales taxes where applicable (not necessarily with all the local variations that brick and mortar stores typically disregard, however).  Re the Earth Day comment, see the next entry (a belated SAFE comment).

4/28/13, Whatever happened to Earth Day? – Two years ago, the News Journal published a tidal wave of stories about Earth Day (which falls on April 22nd every year) and related topics. (4/20/11 & 4/22/11).  Last year there was a column by DNREC Secretary Colin O’Mara. (4/22/12) This year, unless we missed it, there was no Earth Day coverage at all.  Which just goes to show, we think, that this cult-like observance is political in nature.  Here’s an article suggesting that Earth Day 2013 was muted elsewhere, not just in Delaware, and that environmentalists perceive the need for a different focus (but not, apparently, a change in goals).  “What’s in danger is Earth Day, not just Earth,” Christian Science Monitor, 4/22/13.

4/27/13, A1/A2, “Future flood” disclosure out; Panel won’t recommend sellers reveal home’s risks, Molly Murray – A 23-member advisory committee on sea level rise “backed away from a proposal to require sellers to disclose a home’s vulnerability to future flooding.”  However, the existing rule to disclose that “properties reside in designated flood zones, based largely on historic flood and storm surge records” will continue to apply.  The compromise position will “focus on home buyer education and make it easier for potential buyers to get information on sea level rise, floodplain maps, flood preparedness and flood insurance.”  Rich Collins of the Positive Growth Alliance warned that “this kind of language” could lead to future seller disclosure requirements.  And Chad Tolman, representing the League of Women Voters, said he believes it is important that buyers know all the risks.  The next meeting is on May 23, at which point the SLR committee “is expected to take final action on the recommendations.”  Then, “a final report could be complete by Sept. 30.”

4/27/13, A4, Carper, Coons say online sales tax may bring shoppers to Del., Nicole Gaudiano, Raju Cheblum -  The two Delaware senators supported the bill to tax on-line sales on grounds that this would motivate out-of-state buyers to come to Delaware stores to make purchases.  “I want more people from other states . . . to come and buy things in my state,” said Carper in a speech on the Senate floor.  “If they can buy things over the Internet and not pay a sales tax, then why should they come to Delaware?”  Generally speaking, out-of-state buyers are subject to sales and use taxes in their home states.  Are Carper and Coons condoning illegal tax evasion?

4/27/13, A8, Congress shows it only cares for itself, friends, editorial - Quick Congressional action to give the FAA more flexibility to avoid furloughing flight controllers that was causing delays at US airports was seen in most quarters as a reaction to a rather transparent ploy by the Administration to make the sequester hurt in a way that well connected people would notice.  Good for Congress, because this was – as Senator Tom Coburn commented - a cynical “political stunt”.  But the News Journal expresses disapproval that Congress et al. chose to exempt themselves from inconvenience while millions of other Americans “will have to lump it.”  Sure, the federal government “is larded with waste” that “should be cut,” but “sequestration puts the emphasis on the wrong places.”  The real concern, we suspect, is that the president’s game plan of blaming the sequester on the GOP members of Congress is faltering.

4/27/13, B1/B3, Coons fights federal cuts; Nonprofit for children may lose vital funding, Doug DenisonThe Children’s Advocacy Group in Dover stands to lose $77K from its annual budget of $1.3M as a result of the Administration’s plan to cut $20M in funds provided under the federal Victims of Child Abuse Act.  Coons and 30 other US senators sent a letter to the leaders of the Senate Appropriations Committee urging them to reject the cut, and Delaware’s junior senator personally paid a call to the Children’s Advocacy Center to discuss the proposed cut and his efforts to stop it.  No doubt the CAG does commendable work, but the government has a serious fiscal problem and cannot afford to keep operating on a politics as usual basis. Does Senator Coons propose to cut spending in other areas, and if so where?

4/26/13, A1/A2, School getting $350K bailout; Pencader Charter gets state help to pay bills, Matthew Albright – After weighing the consequences of having Pencader close its doors before the end of the school year (see 4/18/13 story), the DE Department of Education will provide the school with an extra $350K to pay teachers and cover closure costs.  State officials handled the situation gracelessly, witness a recent e-mail to the effect that “Pencader wasn’t cooperating in efforts to find ways to save money,” but at least it was resolved.  Said Pencader’s president, Frank McIntosh: “If we could have come to an agreement sooner, that would have been favorable.  But in the end, they evaluated the situation and did the right thing.  I have to give them credit for that.”

4/25/13, A12, Money’s still a mystery; Recession didn’t teach students economics, Phillip Elliott (AP) – One might think high school students would be more financially aware these days in light of “the Wall Street meltdown of 2008 and the ensuing recession.”  But a just released US Department of Education report shows high school senior’s scores on economic literacy were little changed between 2006 and 2012.  And this lack of progress occurred even though “several states added an economics course to high school offerings and some started requiring it to earn a diploma.”  The findings were based on the testing of 10,900 high school seniors at 480 public and private schools as part of the 2012 National Assessment of Educational Progress.  In 2012, it was concluded, only 39% of students have “a basic understanding of economics.” David Driscoll, head of the National Assessment Governing Board, says, “we need to do more to educate all students in economics so they can make informed decisions, whether they are negotiating a car loan, voting or reading financial news.” Here is a link to the NAEP press release. One has to wonder who should teach financial literacy to the young when there is so little agreement about the basic principles among the adult population.  See the following entry for an example.

4/25/13, A15, Only one budget trims costs and brings in revenue, UD economics professor Saul D. HoffmanIn the guise of providing objective analysis, this column touts the president’s budget proposal as the only game in town.  The Senate budget plan is not mentioned. As for the “Ryan budget” (House budget plan), “it cuts the deficit and the debt faster and deeper than necessary and to levels that have no sensible economic basis . . . turns Medicaid into a block grant. . . turns Medicare into a voucher program, which will, according to the Congressional Budget Office, actually raise, not lower, the total costs of healthcare for seniors . . . repeals [GovCare] and provides in return absolutely nothing to improve access to healthcare or to control its costs . . . [re cuts for nondefense discretionary spending, none] of the gory details of the program cuts are spelled out in the budget.”  Then you have “the Obama budget,” which “combines real spending cuts, including to programs like Social Security that no Democrat has ever touched, with some revenue increases on the tax side that are focused on the top three percent of taxpayers.”  And check out this bottom line: “$1.2 trillion in reduced spending, $600 billion in new revenues,” which “puts the grand total of deficit reduction over the critical $4 trillion figure” that is supported by “a broad consensus among budget analysts.”  Professor Hoffman’s column is in line with his last one, “GOP is now the party of fiscal irresponsibility,” (9/21/12).  We disagree with his conclusions that (1) there is no need to balance the budget, let’s just trim the projected deficit a bit, and (2) the deficit cannot be responsibly reduced without raising taxes, i.e., by spending cuts alone.  Moreover, his summary of the “bottom line” does not square with the data in the president’s proposed budget. The bottom line that is actually shown (compare Table S1, “Budget Totals,” to Table S4, “Adjusted Baseline by Category”): Deficit reduction of $1.4 trillion due to, a $1.1T increase in revenues, a net $0.2T reduction in outlays, and a $0.1T reduction in interest expense.

4/25/13, A1/A2, Fisker loan under fire at hearing; Energy Dept., company executives grilled by House committee, Nicole Gaudiano – The gist of the “grilling,” notably by Rep. Darrell Issa (R-CA) and Jim Jordan (R-OH), was that the Fisker loan was an inappropriate political favor.  The witnesses and Rep. Elijah Cummings (D-MD) insisted that nothing improper took place, and that the loan was frozen in a timely fashion once it became evident that the Fisker venture was foundering.  Although the political aspect of the attack is understandable, the more important point is that the government should let the market decide about business investments instead of trying to interject its own ideas.  Whether or not government support for the Fisker venture was a political favor, it should never have been provided.

4/23/13, A1/A12, Feds buy time for Fisker; Energy Dept. uses reserve on loan payment, Aaron Nathans – “The US Department of Energy has tapped a Fisker Automotive reserve account to cover the troubled automaker’s first installment on a federal loan that was due Monday . . .”.  A DOE representative said the $21M loan reserve account, which had been funded by the company, was taken on April 11.  The next loan payment falls due in three months, and meanwhile Fisker will presumably continue to search for a way out of the financial hole it is in.  Headline implies DOE granted Fisker a reprieve.  We preferred the Wall Street Journal headline: “US Seizes funds from Fisker Auto.”  

4/21/13, A28, Hopeful for a spring thaw in Washington, [former Senator] Ted Kaufman – This column hails indications of an outbreak of bipartisanship in Washington, citing as prime examples the “gang of 8” proposal for immigration reform and the Manchin-Toomey bill for expanded background checks for gun purchases “even though the bill didn’t get the 60 votes it needed to pass on Wednesday.”  Also, says the writer, “in the next few weeks we can expect a Wall Street reform bill co-sponsored by [Senators Sherrod Brown, D-OH, and David Vitter, R-LA].”  So stop listening to “the noise coming from Washington,” which might seem to indicate there won’t be any “grand bargain on the budget” this year, and pay attention to what is going on in these other areas.  So far, so good, but the attempt to paint the president’s budget proposal as a compromise everyone should support falls flat.  “The president took the unusual step of waiting [ignored the statutory deadline by waiting] until after both houses had presented their budgets to unveil his own detailed budget proposal.  It is generally acknowledged [really?] to be by far his most serious effort [that’s not saying much] to find some medium [vs. middle, which could be readily refuted since the president’s budget numbers were almost identical to those in the Senate plan] ground.  His reward, of course, has been howls of disapproval from both the left and the right.”

4/20/13, A6//A7, Future on display: Bloom unveils factory; UD shows progress, Aaron Nathans – Big picture in middle of page A6 of men in hard hats; the nearest is demonstrating details of a “plant layout” blue print displayed at viewer’s right.  Caption: “Bloom Energy plant manager Barry Sharpe leads a tour of the company’s new facility.  Gov. Jack Markell and others also viewed the University of Delaware’s College of Health Sciences and College of Engineering building.” Article rehashes the Bloom Energy project, including fact that Delmarva Power customers are paying a monthly surcharge ($1.74 for an average residential customer in April “according to a filing by Delmarva Power”) on their electric bills to subsidize the project (not to “buy power,” as stated, because the power from Bloom generating clusters will be sold to the grid).  The site has been renamed UD’s Science, Technology & Advanced Research, or STAR, campus, and two buildings are under construction.  One will house the Bloom fuel cell manufacturing operation; the second will serve academic purposes for UD.  There will also be a hotel, which is expected to become UD’s primary conference center.  “It’s amazing to see how fast this has gone up,” the governor is quoted, and “someday relatively soon, we’ll be building product at the plant.”  Bloom Vice President Joshua Richman said, “we are fully on track.”  With the failure of the Fisker venture, this project represents the chief hope of the Markell administration to demonstrate the transformative power of “green energy” projects.  But don’t bet on this venture becoming a success; it’s being subsidized for a reason, namely lack of technical or economic merit. 

4/20/13, A6, Bloom plaintiff denied standing again in court, Aaron Nathans – John Nichols, identified as “a Middletown resident,” has appealed an adverse court ruling to the Delaware Supreme Court.  The case involves an appeal by Nichols of a DNREC-granted exemption from the Coastal Zone Act that would permit a cluster of Bloom Energy fuel cells to be installed to generate electricity at a location in the protected zone.  The Coastal Zone Industrial Board dismissed the appeal on grounds that Nichols lacked standing, and a Delaware Superior Court judge agreed – according to this News Journal report – because “Nichols would not be personally injured by the project.”  It is also dismissively stated that “Nichols believed the project would hurt flora and fauna in the area,” and that “Nichols, along with a Bloom competitor named FuelCell Energy, Inc., has filed a separate suit seeking to invalidate the Bloom Energy surcharge.”  THE SUPERIOR COURT RULING WAS WRONG ON THE FACTS:  Nichols did not challenge his claimed lack of standing for the first time in his judicial appeal.  He had done so repeatedly during the CZIB proceeding, and he was not afforded an opportunity to respond after the Board members abruptly reverted to the issue of standing instead of ruling on the merits of the evidence they had heard.  IT WAS ALSO WRONG ON THE LAW. The Coastal Zone Act does not require that an “aggrieved person” show personal injury, and Nichols pointed to numerous flaws in the DNREC proceeding (not just its failure to apprise the public of a potential threat to flora and fauna). While it is always hazardous to predict the outcome of legal proceedings, this case is far from over.  Also, the “separate suit” in federal court could very well derail the Bloom Energy boondoggle – that case has been briefed and argued, although there has been no ruling yet.

4/18/13, A8, Majority opinion on guns trumped in vote, Dan Balz (Washington Post) – New background check requirements for gun purchases were defeated, which supposedly demonstrated “the difference between the power of public opinion and the strength of a concerted minority.”  Although it was expected by the time the vote took place, the outcome triggered an “angry reaction of President Barack Obama, who had invested so much capital in getting gun legislation passed after the shootings in Newtown, Conn.”  The president is quoted as describing the result as “a pretty shameful day for Washington,” which supposedly “summed up the frustrations that many ordinary Americans have long expressed about the capital, which is that the system appears tilted in favor of blocking action on important, if controversial, issues rather than enacting legislation to deal with them.”  A Post-NBC News poll is cited, which supposedly showed that “the idea of expanded background checks received overwhelming support across the political spectrum.”  In addition to being a “resounding defeat for the president,” says the story, it was “a defeat as well for the victim’s relatives, men and women who have walked the halls of Congress and spoken out passionately for action” and “a defeat for former congresswoman Gabrielle Giffords . . . who joined in the lobbying effort.” The checks and balances prescribed by the Constitution have proved their worth over time; let’s be glad they are in place.  Additional comments of the president, e.g., referring to opponents of the measure as liars, are not mentioned. And only 4% of respondents cited guns and gun controls as the most important issue facing the country in a recent Gallup poll.

4/18/13, A1/A8, Del. Senate to vote on gun bill; Similar measure to expand background checks fails in US Senate, Jonathan Starkey – “As hopes dimmed Wednesday for national gun control legislation with the defeat of a compromise measure in the US Senate, Delaware moved closer to expanded background checks that could come up for a full Senate vote today.”  The national setback for gun control advocates came despite the fact that VP Joe Biden was presiding over the Senate session.  The measure required 60 votes to pass [shut off debate]; it got 54 votes.  “Republicans, joined by a group of rural-state Democrats,” blocked it.  The background check measure in Delaware is expected to move forward, but it has generated a lot of popular opposition.  “Advocates for the state bill were far outnumbered by opponents at Wednesday’s hearing,” the story reports.

4/18/13, A1/A9, Pencader students face switch of schools; Charter asks $350K to finish year, Matthew Albright – Another chapter in the saga of the failure and forced closure of the Pencader Business and Finance Charter School.  Whoever is to blame for a shortfall of funds – conflicting statements are quoted – Pencader needs $350K to complete the year.  Otherwise, the school cannot keep paying its teachers and will be forced to shut down before the end of the school year.  Pencader student would then have to be assigned to feeder public schools on some sort of emergency basis, with no end of confusion and inconvenience for al concerned.  State officials have mishandled this situation at every turn, and having pulled the plug on Pencader they should accept responsibility for minimizing adverse fallout.  Coming up with $350K may be inconvenient, but it seems highly unlikely that the forced reassignment of Pencader students to other schools for a few weeks would represent a cost effective alternative.

4/15/13, A8, Stop bashing Delmarva Power for rate increases, Philip Palmer (Newark) – “Isn’t it interesting,” asks the writer, “that politicians are having fits over Delmarva Power’s request for a rate increase” but “were either mute or wildly in favor of unilaterally forcing our rates to increase . . . to subsidize Bloom Energy.”  Evidently, they “have no compunction in using our money to fund their pipe dreams, but heaven forbid that money be spent for useful purpose [improve electrical service and reduce outages] by ‘evil’ businesses.”  See 4/11/13 story on the rate increase for context.

4/14/13, Obama’s budget plan puts limit on his bargaining power, A6, Jim Kuhnhenn & Julie Pace (AP) – Democrats are said to be “balking” at the inclusion of the chained CPI proposal in the president’s budget plan, and White House spokesman Jay Carney saw fit to proclaim that “this is a Republican proposal.”  Accordingly, the writers report, “it’s not politically feasible” for the president “to offer the GOP anything more.”  And in a make nice White House dinner with selected Republican senators on the evening of April 10, the president reportedly (per Senator Orrin Hatch) “indicated that it’s very tough for him [to work with the Republicans] because of his side and their particular approach to things.”   Compare our analysis in the forthcoming (4/15/13) blog entry.

4/14/13, A11, Medicare increase could ding some in middle class, Ricardo Alonso-Zaldivar (AP) – As pointed out in this story, means testing of Medicare benefits (charging higher premiums for those in the upper echelon, not denying benefits) is one concept in the president’s budget plan with which Republicans agree.  Indeed, the practice got started in 2007 under a Republican president. Accordingly, it is “highly likely the idea will become law if there’s a budget deal this year.”  Over time, as a result of inflation, more and more Medicare participants would be affected.  Why?  “The administration is proposing to extend a freeze on the income brackets at which seniors are liable for the higher premiums until 1 in 4 retirees has to pay.  It wouldn’t be the top 5 percent anymore, but the top 25 percent.”  An AARP spokesman criticizes this trend, saying the increased premiums “simply act like a higher tax based on income.”  And note that in many cases, retirees will be pushed into the income brackets affected by required distributions from deferred-income IRAs and 401-Ks.  If Medicare is an insurance program rather than a welfare program, the logic of charging higher premiums to the upper echelon escapes us.  The House budget plan offers some better ideas, but the media is pretty much ignoring them. 

4/13/13, A8, Americans say they’re “doing well” these days, editorial – According to a CNN poll, 50% of Americans say things in this country are “doing well,” the highest score in more than six years.  Never mind the chained-CPI proposal or a dismal jobs report, at least the unemployment rate fell and stock prices are rising.  Rural residents were the least likely to give a “thumbs up,” whereas those in the 18-34 bracket are most inclined to be optimistic.  But “as [the Millenials] reach the learning curve of midlife, more than likely the current entitlement guarantees of Social Security, pensions, Medicaid, etc., will be extremely costly or practically nonexistent.  That’s an economic reality in need of no polling data for verification.”  What point are the editors trying to make? As we understand it, many Millennials are pessimistic about the future of Social Security, etc.

4/13/13, A8, Storm season, record or not, will be expensive, editorial – “People can argue climate change all they want,” but there were potent coastal storms in 2011 (Hurricane Irene) and 2012 (Sandy).  Could have been a lot worse for Delaware, we only got a glancing blow, and who knows what will happen this year and the year after that?  So, yeah, like DNREC Secretary Colin O’Mara says, “we have to come to an agreement that this is becoming the new normal.”  Look at all those billions in federal tax dollars that went to New Jersey and New York, and the after-storm scams that the FBI is now investigating.  “This new normal is bound to be expensive.” Could be, but isn’t that mostly because of all the coastal development?     

4/13/13, A8, Obama’s budget only has the appearance of reform, Charles Krauthammer – The president’s budget is “quite unimpressive,” with “actual deficit reduction over a decade [of] a miniscule $0.6 trillion” – all from tax hikes – and nary a real compromise.  He did put the “chained CPI” proposal in writing, but this change is merely technical and “just about every deficit commission of the last 15 years has recommended [it].”  How about offering something of importance, such as raising “the retirement eligibility age for Social Security and Medicare to match longevity?”  Probably the president has gone as far as he is willing to go, but “the proposition deserves testing –through a major GOP concession on revenue.  Game on.  By regular order.”  Et tu, Krauthammer?  The conclusion does not follow from your analysis.

4/12/13, A3, Critics on both sides say Obama budget breaks vows, from AP and USA Today reports – It is estimated that the chained CPI proposal would raise income taxes by almost as much ($100B) over the next decade as it would trim Social Security and federal retirement benefit increases ($130B).  This has fueled claims from both the left and the right that the president is breaking campaign promises, but his reported position is that this is “the kind of balanced approach that is necessary to tame runaway budget deficits.”  Some taming!  The president’s budget plan projects deficits averaging $0.5 trillion per year over the next decade.

4/12/13, A10, A reasonable budget hits an unreasonable wall, Ruth Marcus (Washington Post) –Having already put his budgetary cards on the table in the fiscal cliff negotiations with House Speaker John Boehner, it was right for the president to offer a “reasonable-under-the-circumstances compromise” instead of a “wish list.”  In doing so, he “[came] down, ideologically, between (although by no means equally between) the House and Senate budgets.” Accordingly, his is “by far the best” of the three budgets that have been produced and has “the best chance of passage.”  But Republicans are likely to balk at more tax increases, so “that is not, at the moment, saying very much.”  Marcus ignores the predictable consequences of keeping the spending party going, and she gives the other side no credit for proposing a change in direction.   

4/12/13, A11, Who pays for government when the wealthy don’t? Representative John Kowalko (D, 25th District) – Remember Romney’s famous remark that 47% of Americans pay no income tax.  But pretty much everyone is pitching in for the common good by paying state income taxes, local property taxes, federal payroll taxes, gas taxes, sales taxes, tobacco taxes, etc., so the question boils down to whether everyone’s paying a fair share.  Not Warren Buffet (who “admits paying a lower tax rate than his secretary”): not “huge and immensely profitable multinational corporations like Boeing, General Electric, and Bank of America (which “in some recent years have paid nothing at all”); not a millionaire in Philadelphia (“who may deduct nearly 40 cents for every dollar of mortgage interest paid on his Society Hill townhouse, whereas a middle-class homeowner in Newark or Wilmington gets to deduct 28 cents”).  “And when the wealthy don’t pay, we do”  - in taxes, interest on money the government has to borrow, and poorer public services, “leaving us with more potholes, shorter library hours, increasingly dilapidated schools, less college aid, fewer Head Start slots, shrinking nursing home assistance, threats to child nutrition and cuts in Medicare and Social Security.” A reformed tax system could spread the burden of government more fairly, collect revenue more efficiently, and promote more robust economic growth to the benefit of all.

4/11/13, NJ’s reporting on the president’s budget proposal focuses on one supposed concession ignores almost everything else  -  (A) Obama: Budget “fiscally responsible,” A9, Aamer Madhani & Susan Davis (USA Today) – Elicited groans from his conservative opponents as well as his backers on the left – includes $2 in spending cuts for every dollar in new revenue – would reduce the federal deficit to 1.7% of GDP by 2023 – presidential aides argued that it would cut the deficit in a responsible way and said the inclusion of “new revenues” was non-negotiable.  House Speaker John Boehner “applauded Obama for proposing entitlement reform, albeit saying the proposed changes should not be “held hostage” to raising taxes on the wealthy.  Senate Majority Harry Reed “shrugged” at the White House proposal to use a “chained-CPI” procedure to calculate cost-of-living adjustments to Social Security.  (B) President’s budget gets a big question right, A14, editorial – While characterizing the chances of the president’s budget “going anywhere” as “slim” – there are two other budget plans in play and “differences between the three are wide and deep” (actually, the Senate plan and the president’s plan are similar in many respects) – but the president’s proposals “deserve a second look” as they would “[move] the national debate to another phase.”  The point is dialing back the preference for supporting senior citizens versus supporting the young, e.g., by reducing cost-of-living adjustments for Social Security (chained-CPI proposal) and charging Medicare coverage more for the services they consume, while expanding pre-kindergarten schooling at the state level for low-and middle-income children. (C) Obama’s triangulation and the Democratic left, A15, Dana Milbank – Opposition to the president’s budget by the far left, notably by Senator Bernie Sanders who was fit to be tied about the chained-CPI proposal, may be helpful to the president in his negotiations with Republicans.  “Now Obama, by publicly defying liberals in his party, looks like the reasonable one – and the Republicans look unreasonable if they continue to carp about Obama’s proposal without offering more tax hikes.”  An analogy is drawn to President Bill Clinton’s triangulation on welfare.  The intergenerational equity issue is real, but the chained-CPI proposal is a sneaky way to penalize seniors; note that the proceeds would go into new spending programs vs. deficit reduction.  Balancing the budget would be the best way to help future generations, but the president’s budget calls for $5.3 trillion in deficits ($8 trillion in debt increases) over the next 10 years.  See our upcoming (4/15/13) blog entry for more discussion.

4/11/13, A1/A7, Batten down the hatches; O’Mara says increased hurricane activity is the “new normal,” Jeff Montgomery – Top story - spread across all three columns on page one and continued inside the paper - summarizes a prediction of two climatologists that hurricane activity will be unusually high in 2013.  Here’s a summary of their report from the Orlando Sentinel, which notes that Florida hasn’t been hit by a hurricane since 2005 and is probably about due. Locally, DNREC Secretary Colin O’Mara is quoted that the connections between tropical storms and global warming is “hard to avoid” so “we have come to an agreement that this is becoming the new normal.”  Higher temperatures – greater wind velocities – more impacts.  Ergo, “we have to address our vulnerabilities” and complete the beach nourishment projects that are in the queue right now before the hurricane season begins.  Get those Sandy relief funds moving – Delaware requested $30M for Atlantic Coast beaches alone – as soon as possible!  No harm in being prepared, appropriated funds should be used to best advantage, but the alleged connection between global warming (which has stalled over the past 15 years) and storm activity is dubious. Next time, sue the weatherman, 3/23/12, Washington Times editorial,

4/10/13, A1/A5, Delmarva’s rate request “very alarming,” Aaron Nathans – Twenty DE legislators sent a letter to the Public Service Commission decrying “the latest request to raise the average customer bill by $7.63 a month – a total of 5.4% (or 19.6% of the delivery component to which it relates]. “Also registering concern were 12 community, labor or political organizations including the National Organization for Women and the [for once not labeled “conservative” or whatever] Caesar Rodney Institute.” It seems that opposing serial increases in electric power costs has suddenly become good politics.  Where were the legislators when the Bloom Energy tariff and the smart meter nonsense were going through? 

4/10/13, A10, Use budget proposal to fix Social Security plan – Inclusion of a “chained CPI” for future cost-of-living adjustments in the president’s budget proposal is being assailed by both the left and the right.  But Social Security “does not need massive cutbacks,” and “most of the fund’s shortfall” could be eliminated by “raising the wage limit on Social Security taxes.”  In other words, don’t cut spending – just keep raising taxes on high earners.  Brilliant!

4/6/13, A3, President’s budget will focus on debt reduction – In the run-up to its delivery to Congress, now expected to take place around April 10, here come more previews about the president’s budget proposal.  It “will include debt reduction offers previously made to congressional Republicans” – notably a less liberal cost of living calculation to slow the growth of Social Security benefits (and speed the growth of tax revenues). The president will reportedly not sign off on this and other cuts “unless congressional Republicans agree to new tax revenues by closing tax loopholes for the wealthy.”  But take heart, because “the proposed budget would reduce the debt by $1.8 trillion over 10 years.” This last statement, and the headline as well, apparently confuse “debt” with projected deficits. Even with the supposedly draconian House budget plan, debt would increase by $3 trillion over the next 10 years.  There is not a chance that the debt will be reduced any time soon.

4/6/13, A8, Latest jobless figures send national danger signal – This editorial begins by recapping yesterday’s jobs report.  88K jobs were added, but with about 500K people dropped out of the labor market the decline in the jobless rate to 7.6% did not seem very reassuring.  Other worries include the rising number of temporary workers, high unemployment rates for young people, and a loss of jobs in sectors where people without college degrees can find work (services and manufacturing).  Efforts to blame the results on the sequester fell flat, as economists are more inclined to blame the payroll tax increase that went into effect at the start of the year. The editors go on to predict that the president’s budget proposal will “go nowhere” because congressional Republicans aren’t up for more tax increases.  But hey, the fiscal problem is long term whereas the big problem now is unemployment, so “the demand for across-the-board cuts” now seems misdirected. Perhaps it’s time “to get more money into the hands of working people” and “get businesses to spend.”  How about “a simpler tax code [that] rewards businesses for investing in this country” and “a sensible budget that directs tax money to productive investments like upgrading the infrastructure.”  That would be “better than having the political parties constantly sniping at each other.” No dice, action on the fiscal problem has been put off far too long as it is.  Furthermore, the anemic economy is not due to a lack of stimulus, although revenue neutral tax simplification is certainly needed.

4/5/13, A1/A5, Obama’s budget will spare Medicaid; Deep cuts proposed last year will be avoided, Ricardo Alonso-Zaldivar (AP)With the president’s budget now scheduled for release on April 10, the usual pre-release publicity about what to expect is starting up.  No doubt this effort will continue on the Sunday talk shows, etc.  NJ article predicts that no cuts in Medicaid will be proposed since the administration is trying to convince numerous holdout states to go along with the expanded Medicaid coverage that is contemplated by GovCare.  “As far as curbs on Medicare,” however, the president “seems to be searching for compromise with Republicans.”  Possible proposals include means testing of Medicare benefits, changing copayments and deductibles “in ways that would protect the sickest beneficiaries but would probably raise costs for others,” and asking future new Medicare participants “to pay more for some services.”  Details omitted from this report: (a) chained inflation calculation that would cut Social Security benefits and raise taxes over time; (b) proposed spending cuts, such as they are, would be contingent on more tax increases for the well to do (which Republicans have declared a non starter), and (c) the president’s budget, due on February 4, has apparently been delayed for tactical reasons (aka “leading from behind”).  Compare the New York Times story, which is more complete.

4/5/13, B3, Piping up over pipeline – This report (no byline) consists mainly of two pictures: (a) Perhaps 20 protestors, holding signs, of which two are readable: “Delaware sys NO Keystone XL” and “Delaware railroaded by tar sands.”  (b) “An onlooker [holding up a cell phone that seems to be her main focus] watched as protestors passed the building at 1105 N. Market Street on Thursday.”  The text says “60 members of Sierra Club, the Green Party of Delaware, and other student, environmental and civic groups pressed Democratic Sens. Tom Carper and Chris Coons on the issue after they voted for a nonbinding measure supporting the pipeline.”  The pipeline is labeled as a “controversial project” that “would deliver crude oil from Canada to US refineries and export terminals.”  No comment from either senator, aside from a general assertion that “the lawmakers said that the Obama administration would determine the Keystone pipeline’s future, rather than Congress.”  If Carper and Coons truly support the pipeline, it seems to us, they should be willing to say so.   

4/3/13, B1/B7, Markell: no dice on tax cut deal; Casinos in “very dire situation,” CEO says, Doug Denison – DE casino executives asked Secretary of Finance Tim Cook to revisit the tax rates they pay, e.g., consider a tiered tax structure for slot machines and table games vs. the current 43.5% of slots proceeds and 29.4% of table game proceeds.  Not politically or fiscally opportune, and Markell Administration rebuffed the idea.  However, revenue is falling due to casino construction in neighboring states.  Thus, 2012 DE slot machine revenue of $438M was down 29% from the 2007 level of $617M. And according to Dover Downs Hotel and Casino CEO Ed Sutor, “we’re losing money and it can’t go on.”  All three casinos have cut staff, are using more part-time workers to hold down benefits costs, and are skimping on capital expenditures (to keep their facilities attractive for customers).  Maybe online gambling through Delaware’s casinos, expected to be up and running by Sept. 30, will help.  If so, however, other states will predictably follow suit.  Conclusion: don’t count on continuing high revenue from this source because it’s drying up.

4/1/13, Alan Levin didn’t defend Markell jobs plan, A10, Richard Timmons (Middletown) – The writer sums up Delaware Development Office Director Alan Levin’s 3/15/13 response to economist John Stapleford’s 3/7/13 column on Delaware’s lackluster economic future as follows: “All is well, we’re doing great, everyone loves us.”  But realistically, things are not looking so good: (A) Just a few days ago, AstraZeneca announced that 1,250 jobs in Delaware would be eliminated through layoffs and moving jobs elsewhere.  If Delaware’s business climate was truly attractive, wouldn’t AZ be moving jobs here from elsewhere? (B) According to the Wall Street Journal, the Chinese government does not want to do a Fisker rescue deal because of Fisker’s commitment to produce cars in Delaware at an old and expensive facility.  (C) Union opposition killed a deal to privatize (and upgrade) the Port of Wilmington.  (D) And “even after all these setbacks,” the Delaware legislature and governor are salivating at the prospect of “an additional $11 million in estimated revenue, more money to spend.”   

3/29/13, we told you so department – Fisker “teetering on the edge”; bankruptcy possible as investor leads dry up, furloughs begin, A1/A7, Aaron Nathans – Blocked from drawing down more of the previously approved federal loan and so far unsuccessful in finding a strategic partner, the start-up firm that intended to manufacture electric cars at the Boxwood site in Delaware may be unable to meet a scheduled payment date on the portion of the federal loan that was made available.  And the First State may be hard pressed to “claw back” the $20M+ it advanced to Fisker if the firm files in bankruptcy. SAFE warned repeatedly that this was a dubious investment.  See, e.g., (1/15/10). Climate change threatens oceans, A10, Dan Vergano (AP) – “A danger lurks beyond the shore,” readers are informed, “that will threaten clams, mussels, everything with a shell or that eats anything with a shell.  The entire food chain could be affected.”  The purported threat is ocean acidification, caused by human-caused carbon emissions, building up in the atmosphere, causing global warming and more CO2 dissolved in sea water.  The future is fore-shadowed by conditions in bodies of water like Puget Sound, where strong winds can result in periodic “upwelling” of deeper ocean waters that are more acidic than surface waters.”  Oceanographer Richard Feely of the National Oceanic and Atmospheric Administration (NOAA) first charted this phenomenon along the West Coast on a 2007 expedition.  Among other things, this story ignores the adaptive abilities of shellfish, coral reefs, etc.  See John Greer’s letter of last year (4/25/12) and the CO2 Science site. “In conclusion, claims of impending marine species extinctions driven by increases in the atmosphere's CO2 concentration do not appear to be founded in empirical reality, based on the experimental findings we have analyzed above.” Poll: US should prepare for climate change, A10, Wendy Koch (USA Today) – A Stanford University survey “finds that 82 percent of American want the nation to prepare for damage expected from sea level rise and storms, both of which are [supposedly] exacerbated by global warming.”  Various solutions are contemplated, including strengthening building codes and preventing new construction near the coast.”  But only 38% say the government should pay for the cost of protecting or reimbursing “the people and businesses in high-risk areas that are affected by sea level rise and storms.”  According to NOAA, “US coastlines will be home to 11 million more people by 2020.”  Storm surge damages in coastal zones are rising, but the driving force is not climate change – it is coastal development.

3/27/13, victory lap taken re declaration of Delaware national monument – There is more coverage of this development, starting with a front page story (Biden marks historic “moment”; VP visits newly designated monument) topped by a photo of the beaming vice president posing with Interior Secretary Ken Salazar in his trademark western style hat, continuing with a two-page, lavishly illustrated spread on “First State Heritage Park: Destination Dover” (most of Dover will not be included in the federal monument, just the Dover Green), and ending with a column by Blaine Philips, Mid-Atlantic director of The Conservation Fund, “First State National Monument is uniquely Delaware,” which calls this “a shining example of how our state can pull together and get things done.”  Salient facts from the news story, written by Jonathan Starkey: (a) “the Delaware sites will receive an estimated $1.5 million in federal money for renovations to the Sheriff’s House [in old New Castle], another $1 million to develop a general management plan for the sites and about $1.5 million a year for maintenance and operations that will include salaries for park rangers and a monument superintendent;” (b) federal government now owns the Old Sheriff’s House and the Woodlawn property, donated by the Conservation Fund, which had purchased it using a $20 million gift from the Mt. Cuba Center; (c) the New Castle Court House and Green and The Green in Dover are under easement to the feds (rent free) and “will remain locally operated.”  Although “some congressional Republicans have argued that the federal expenses are a waste of taxpayers money at a time when billions of spending are being cut from [existing] government programs,” Vice President and Senator Tom Carper don’t seem to see things that way.  Their quoted statements portray the national monument as a step towards correcting a long-standing inequity, in that every state except Delaware has at least one national park.  Thus, in Carper’s words, “for a hundred years we’ve been paying our taxes to support [the other states’ national parks],” so “maybe it’s time for somebody else to pay a little more to help make sure that we’re not the only state without a national park.”   Carper and the other members of Congress will reportedly continue to push for legislation to create a full-fledged national park in Delaware to include the national monument locations as well as additional sites.  However, the legislation “has been held up by Republicans who say the National Park Service already has a $12 billion maintenance backlog.” Seems to us that the Republicans are asking the right questions about this project, except we would point to the huge overall deficits being run and not simply to the sequester spending cuts.  However, SAFE’s views have not been solicited by the News Journal despite the newspaper’s professed concerns about the fiscal problem.  See, e.g., their 12/28/12 editorial warning of “a series of fiscal calamities, all preventable, all predictable and all based on ideological differences.”

3/29/12, A12, Who benefits from pipeline project? David Rickards (Frankford) – In lieu of the standard environmental arguments, the writer raises two other objections to the Keystone Pipeline: (A) An alternative route away from the most vulnerable aquifers should be considered.  Rightly or wrongly, the pipeline has already been rerouted for just this reason.  (B) A percentage of the refined product might then be “shipped out of the country,” thereby allowing other countries to benefit from the Canadian oil.  US oil imports from volatile areas of the world would be reduced, and any exports of refined product will contribute to the US balance of payments.  Why should the government dictate where gasoline produced from this particular oil gets consumed instead of allowing the decision to be made based on supply and demand?  Also, we applaud the Senate vote – nonbinding though it was – re approving the pipeline.  Kudos to Senators Tom Carper and Chris Coons for voting “aye.”  

3/23/13, A9, Affordable Care Act helps in changing course, Senator Tom Carper – The ACA [or GovCare as SAFE calls it] “isn’t a silver bullet to fix all the problems in our healthcare systems,” says the writer, but it is “a strong rudder” that can help “to turn the aircraft carrier around and chart a new course toward lower healthcare costs and better health outcomes.”  Of course, the rudder won’t do all the work – “individuals, families, healthcare providers, businesses and state and local governments need to step up too.”  Already, good things are happening: seniors are saving on their prescription drugs, seniors are receiving free preventive services (e.g., screenings for heart disease, diabetes and cancer); 23M children with preexisting conditions and young adults [staying longer on their parent’s HCI plans] have dependable health[care] insurance coverage.  And we are “successfully lowering costs in Medicare,” which hit historic per person lows last year and are now increasing by only one-half of 1% per annum (expected to continue through 2020).  But we’re not done yet, and “later this year, millions of individuals and small businesses will be able to purchase affordable, quality health[care] insurance with the confidence that they will get a quality product with a guaranteed level of benefits.”  It will take time to transform our country’s current “sick care” system into a true “healthcare” system, but if everyone pulls together we can do it.  Sen. Carper delivered much the same message in a recent video (3+ minutes), and no doubt he believes it. But with all due respect, we see things differently.  Doctors expected to retire early because they don’t feature kowtowing to government bureaucrats – anticipated doubling of healthcare insurance premiums – avalanche of regulations that will increase already excessive overhead costs of healthcare providers and insurers – timely access to the healthcare system will become a real issue for middle class Americans – fiscal books being cooked to hide the coming disaster.  Bait and switch, John Goodman,, 3/16/13.  And it’s not as though we did not offer any input on healthcare reform, because we made every effort to reach out to Senator Carper before GovCare was enacted, (9/7/09).

3/22/13, First State miscues in the news – (A) Big step closer to a park: Obama to declare three Delaware sites a “national monument,” A1/A2, Jeff Montgomery & Melissa Nann Burke – Why should the president declare three separate sites (about 1,100 acres of Woodlawn property in Brandywine Hundred; Old New Castle County Court House, New Castle Green & Old Sheriff’s House; and Dover Green) as a “national monument”?  The reported rationale (which sounds absurd on its face) is that these sites represent “a unified symbol of the state’s colonial heritage and its role in the nation’s founding under the Constitution.”  But the real point is that this would be the first step in correcting what some politicians (Vice President Joe Biden, Senator Tom Carper, et al.) perceive as a glaring inequity: every other state in the union has a national park, with the federal funds that go along with it, so Delaware should have one too.  With the federal government facing a huge fiscal problem, this project is well nigh incomprehensible.  Delaware politicians should find more worthwhile goals to work on.  (B) Minimum wage bill OK’d; Senate sends proposal to House for action, B1/B2, Jonathan Starkey & Doug Denison – The Senate voted Thursday to raise Delaware’s hourly minimum wage to $8.25 over two years, despite objections from Senate Republicans and the New Castle Country Chamber of Commerce.  This represents a lesser increase than was proposed in the bill sponsored by Sen. Robert Marshall (D-Wilmington) – $8.75 over two years, to be indexed for inflation.  The governor supports the bill as passed “because of the help it will provide to many struggling families.”  Other views are noted, such as a statement by Sen. Gerald Hocker (R-Ocean View) that the minimum wage increase would hurt the very people (low income workers) it purports to help.  We’re with the dissenters, as has been made abundantly clear in prior entries

3/18/13, A1/A2, Climate foes: “Sick” science distorts facts, Jeff Montgomery – Re an event sponsored by the Positive Growth Alliance and the Caesar Rodney Institute, the News Journal accurately reports the general tenor of what two scientists (Willie Soon & David Legates) and a civic activist (Rich Collins of the PGA) had to say to an audience of some 250 people at the Cheer Center in Georgetown.  Photo on page 2 pans faces in the audience; it looks like a full house that is following the proceedings with great interest.  Soon & Legates, who spoke respectively about the global and mid-Atlantic region pictures being painted by climate alarmists and the media,  “bluntly rejected” claims about accelerating global warming and resulting sea level rise.  And Soon did indeed call the other side “a very sick group” for presenting “agenda-driven science results” instead of seeking verifiably true answers to the issues under discussion.  Re sea level rise, Legates slammed the three scenarios that the Sea Level Advisory Committee is being charged to consider on grounds that they imply a level of SLR that is not supported by either historic data or reasoned extrapolation.  And as noted, Legates “listed a string of [peer-reviewed scientific] articles that said no long-term [more accurately accelerating?] sea-level rise trend could be proven in recent decades.”  Further, the SLR that has been observed and is expected to continue is based mainly on land subsidence – which obviously cannot be stopped by reducing carbon emissions – not rising seawater.  North Carolina tossed out a projection of accelerating SLR as nonsense; why shouldn’t Delaware follow suit?  The article is salted with a few zingers, e.g., Soon is described as “one of the nation’s more controversial climate change skeptics” [perhaps this is fair comment, although he comes across as knowledgeable, sincere and fair minded], and “some environmental groups” are said to “have pointed to Soon’s and Legates’ ties to organizations financed by fossil fuel and deeply conservative [shudder] interests, including the George C. Marshall and Heartland institutes.”  DNREC Secretary Colin O’Mara [who was not present at the event to our knowledge] is quoted for three paragraphs towards the end of the story re “overwhelming” scientific agreement on the link of climate change to human activity – “we’re experiencing exactly what the climate models predict: warming global temperatures [no noticeable increase in 16 years!], more extreme weather events, sea-level rise” – time “to focus our efforts on how to reduce emissions most cost-effectively, improve the resiliency of vulnerable communities and strengthen our economy in the process.”   On balance, this is the fairest story the News Journal has ever published about global warming and SLR.  As nonscientists, we cannot necessarily say the picture painted by Soon and Legates represents “the truth,” but we heartily agree with them that science should be a search for truth in which the data are evaluated objectively versus being manipulated to support preconceived conclusions.  Let the scientists do their thing, and at the end of the day truth will prevail! In the meantime, let’s forget about spending huge sums of money on ill-conceived alternative energy ideas that would not solve the alleged global warming and SLR threats, especially considering (as Rich Abbott tellingly noted) that the economic burden would fall mainly on people in the base and middle of the economic pyramid vs. the folks at the top.  The glib talk about creating green jobs, etc. is dubious to begin with (, and as Dave Stevenson of CRI reported at the meeting there is growing interest in building combined cycle natural gas power plants in Delaware like the Calpine plant that is already under construction.  It’s a win-win idea, which will not only bring down electric power costs but also reduce carbon emissions (that should please global warming alarmists) because such plants can replace coal power plants in a cost effective manner (wind and solar power is intermittent, and therefore does not add to peak demand capacity).  Could it be that the tide is finally turning?  Let’s hope so!

3/18/13, A8/A9, Public Advocate resigns; abrupt departure for Michael Sheehy, Aaron Nathans – This development follows a hearing last month on the Public Advocate’s office by the legislative Joint Sunset Committee.  See 2/20/13 story.  Critics thought Sheehy had been unduly solicitous of the interests of the regulated utilities versus “representing customers” as this story says he was supposed to do.  We tend to agree based on Sheehy’s ready acceptance of the Bloom Energy boondoggle among other things. Unless the PA is committed to advocating for ratepayers, the cost involved is a waste and the office should be eliminated.  

3/18/13, B1B9, Delaware revenue: Windfall forecast for state in 2014; Budget panel expects $11M more from taxes, Doug Denison – Actually, revenue estimates for fiscal 2014 (starting 7/1/13) were raised $37.5M while estimates for the current year were trimmed $26.5M (mainly due to a projected drop in corporate income tax receipts).  But in any case, the changes are relatively minor in relation to a state revenue base of over $3B.  Also, there are several variables in the mix: (a) multiyear audit of a “large corporation” is expected to result in a payment to the state of $65M, some uncertainty as to exactly when the proceeds will be received; (b) a $60M corporate tax refund is being claimed; the state has asked the “refund-seeker” for “more information,” which has not yet been received; (c) the effects of a just-announced 1,200 employee cut by Astra Zeneca have not been considered.  Ergo, the lead sentence about how “state leaders will have an additional $11.1 million to spend in fiscal 2014” is hype. 

3/17/13, A21, Some movement offers hope for federal budget deal, Ted Kaufman – This column predicts a “grand bargain” on the fiscal problem later this year; it does not discuss what precise outcome is desirable. Kaufman begins by referencing a December column in which he made a similar prediction while everyone else was obsessing about how hopeless the situation was. We may not have noted the column, but the closest we could come was an 11/25/12 column entitled “a scalpel, not ax needed to cut US budget”.  Kaufman’s reasoning: in his long-time service in the US Senate, he “saw how our system changed and adapted to new realities” – fiscal cliff threat “was resolved without any real damage” – sequester can be fixed “before too much damage is done” – Republicans know they came up on the short end of the stick in the 2012 elections, even though they held the House – a bipartisan deal is cooking on “immigration reform” and Republicans caved on reauthorization of the Violence Against Women Act – the president’s charm offensive is going great - Senate Democrats unveiled a budget proposal “for the first time in four years” (although it “does nothing on entitlements”) as an alternative to the House GOP proposal (which “looks like a perfunctory effort to overturn the election results”) – as for the potential for compromise, there are “definite signs of support among at least some Republicans for budget proposals that will include increased revenues through tax reform and reductions in the long-term costs of defense, Medicare and Social Security,” while “all but the most liberal Democrats seem willing to explore ways to reduce the costs of Medicare”  - everyone understands that the voters “sent a clear message in the last election to get on with it” – “the same kind of bipartisan effort that led to budget surpluses in the 1990a can succeed again.” Democrats have shown no interest in cutting spending, all they want to do is raise taxes – as in the fiscal cliff deal – some more.  That would be bad for the economy and wouldn’t solve the fiscal problem.  The GOP budget, which would slow the rate of increase in spending (not actually cut it) without raising taxes, won’t go anywhere.  Accordingly, there is little chance of a “grand bargain.”  We can’t keep spending like this, (3/4/13). 

3/17/13, A21, Port union acted to save worker jobs and pensions, Julius Cephas (president of Int’l Longshoreman’s Assoc. Local 1694-1) – Cephas wrote a column on 2/21/13 opposing the Kinder Morgan proposal to lease the Port of Wilmington on a long term basis.  Now KM has withdrawn its offer as a result of union opposition and legislative intervention, he praises “what was accomplished by Delaware Senate Bill 3, supported by Sen. Robert Marshall and supported by the legislature, union, business community, environmentalists, bloggers and local community activists in regards to the proposed privatization of the Port of Wilmington.”  The outcome purportedly “saved jobs” and ensured “the viability of the port long-term” rather than sacrificing “30-year mortgages of working families for a three-year promise to protect the jobs for a select few.”  KM’s “refusal to keep its promise to submit a viable proposal for over a year may demonstrate that its intentions were not as stated,” i.e., KM was just out to make a buck for themselves.  Obviously, the community needed to be protected from “possible traumatic events that had been witnessed in the past by [KM’s] former partners that resulted in lost pensions, elimination of jobs, lives destroyed, communities left in ruins and an environment damaged by toxic chemicals and contaminated waste.”  So “we did not refuse to meet with a partner willing to invest in the future of the city and the port,” but simply refused “to sell out” our children, residents in the community, workforce safety, and long-term sustainability.  Now we “stand ready to work with any company willing to invest its interest with the people of this community and this region” that has “a demonstrated commitment to the Port of Wilmington’s long-tern success.”  On the previous page, letter write Ron Wohlust of Dagsboro critiques the earlier Cephas column.  Low information Delawareans may not know it,  but the German auto companies cited by Cephas are moving auto production out of Germany as fast as they can due to exorbitant labor costs.  Further, KM rightly recognized that the port leasing deal was going off the rails and withdrew its offer.  As a result, “lucrative union jobs of current port workers are secured for the short term,” but “an opportunity for growth of the future Delaware economy and workforce is lost.”  See 3/10/13 story re the KM withdrawal.  It reports that the Port of Wilmington can only survive in its current configuration with a substantial taxpayer subsidy, perhaps $20M per year, which Cephas fails to mention in his columns.

3/15/13, counterpoint to John Stapleford’s 3/7/13 column on Delaware’s predictably lackluster economic future – (A10) Letter from Ahmer Sajad, CEO of Barclaycard US, expresses surprise because “Barclay’s has been thrilled with the business-friendly environment in the state, the quality of the work force and the accessibility of our leaders.” As though for emphasis, although presumably by accident, this letter was run for a second day – we had seen it before (yesterday?).  (A11) Column by DEDO Director Alan Levin, entitled “Writer misrepresents Delaware’s economic health,” identifies Dr. Stapleford as “a staff member of the conservative [shudder] Caesar Rodney Institute,” and attempts to rebut the gloomy picture that Stapleford painted.  One theme is that Stapleford chose the onset “of the 2008-2009 worldwide financial crisis and the ensuing Great Recession” as his starting point.  No wonder Delaware has been struggling in the aftermath of this catastrophe, what would one expect?  A second theme is to search for accomplishments to tout, such as the restart of the Delaware City refinery, the location of an Amazon distribution center in Middletown, and “Bloom Energy is building its new factory in Newark.”  So, yeah, there is still a long way to go, but “Delaware has made undeniable progress.”  Third, Delaware is “laying the foundation for future growth.”  School performance is supposedly on the upswing, e.g. “graduation rates have moved steadily higher” and “more parents are choosing Delaware’s public schools.” The dubious decision to shut down Pencader Charter School will help in that regard.  And did you know that Delaware has moved from 31st to 10th among the most bike-friendly states? Mr. Levin ignores several points in Stapleford’s bill of particulars, e.g., tax increases, burgeoning state spending, and high energy costs, probably because they are undeniable.

3/15/13, A10, Lock down Congress to solve fiscal issues, Dean C Loomis (Newark)This suggestion is better than yesterday’s letter about throwing GOP members of Congress “in the slammer” for obstructionism in that Democratic members of Congress would presumably be sanctioned along with their Republican colleagues.  But the writer ignores the president’s starring role in the series of budget crises that have played out since 2011, and encourages disrespect for the checks and balances of the Constitution.  If Congress can be forced to do the president’s bidding, although it makes no sense (or even, for the sake of argument, if it did), then this country is on its way to a dictatorship. 

3/14/13, A2, Carper again seeks bipartisan budget; Blames “crisis budgeting” for making government less effective, Nicole Gaudiano – Senator Carper conducted a hearing of the Senate Homeland Security and Governmental Affairs Committee yesterday, which focuses on adverse effects of the “crisis budgeting” that is being played out in Washington these days.  The article reports that “Carper has long called for a comprehensive budget and deficit reduction plan,” witness his vote against the last minute “fiscal cliff” deal.  Professor Philip Joyce of the University of MD testified that the failure of Congress to pass a budget resolution in seven of the last 15 years is a “bipartisan problem,” and suggested that Congress should make it more difficult to pass stopgap spending measures.  Carper highlighted GAO findings that $5.4M in extra cost will result from delays that prevented the Bureau of Prisons from locking in the contract price.  Also, cancellation of ship repair contracts is expected to increase costs while degrading operational effectiveness.  Meanwhile, frustrated federal employees, whose pay has been frozen for more than two years, are said to be retiring at record rates.  Carper’s conclusion: “I believe the best route we can take is to pass a comprehensive, bipartisan plan that gives government and business certainty and shows the American people that we can lead.”  While the rhetoric is fine, we do not recall Senator Carper ever pushing to cut specific government programs – of which there are many – that cost more than they are worth.  To the contrary, he has supported added commitments – such as a national park for Delaware and stepped-up funding for Amtrak. 

3/14/13, B1/B2, Trial day furlough set; District Court to limit hearing on Friday, Sean O’Sullivan – The District Court in Delaware “soon will stop hearing all but critical criminal proceedings on Fridays due to federal spending cuts” that will force furloughs without pay of federal prosecutors, federal public defenders, and US marshals.  The result will be that things will take longer, although supposedly without cutting corners.  Civil matters will not be affected.  All three members of Congress decried the spending cuts that forced the court action, and Senators Coons and Carper are reportedly working to replace the sequester cuts with “a more thoughtful plan.”

3/14/13, A10/A12, Fisker exits his startup; Co-founder resigns over firm’s strategy, Aaron Nathans – Story leads with a picture of the company’s visionary, Henrik Fisker, at a microphone touting the plans to build electric cars in Delaware.  Standing to his right and slightly behind him is Vice President Joe Biden looking pleased.  But much has happened since 2009, and now the company has run out of available funding (only a portion of the federal loan was disbursed due to failure to meet sales and production targets for the first Fisker model, a $108K luxury car) and is seeking a “strategic partner” (someone to buy them out).  Chinese firms have expressed interest.  Even if someone with deeper pockets takes over Fisker, there is little reason to expect that its electric cars will be produced in Delaware.  The state will be left with the prospect of trying to “claw back” the funding (originally approved $21.5M in loans & grants, most of which has presumably been disbursed) that was made available.    Good luck with that!

3/14/13, A14, letters to the editor – (A) Matthew Farmer of Hockessin reports recently learning of a “Chinese carbon cap-and-trade” program.   He goes on to argue that a carbon tax should be imposed in this country to ensure that “the full cost” of burning fossil fuels is recognized by the market place – which could be offset by reduced income taxes (like that would really happen).  Otherwise, the writer claims, “we risk bankruptcy and economic devastation since these are limited resources with huge negative externalities.”  The claim that fossil fuels must be taxed because they are a finite resource is silly, and the manmade global warming theory remains highly speculative.  China has been talking about a carbon tax, but at last report was planning to defer it due to lots of opposition. (B) John J. Bortzel of Lewes accuses “the Republican Congress” of extortion, i.e., “threatening to destroy our government unless the president does what they want.”  To get something done, “it’s too bad we can’t put Republican members in the slammer.”  So the writer wants a dictatorship?  And who says the Republicans are being unreasonable while the president’s ideas are right? (C) Jerry Martin, a SAFE director, points to a constructive development in China, namely plans to slash funding for domestic solar panel manufacturers, and suggests the US government could learn from China’s example. The full text is posted on the LETTERS page of this website.

3/13/13, A12, Despite the shouting, budget plans are progress – Editorial expresses modest satisfaction that “Republicans and Democrats are proposing budgets” and “doing more than just criticizing each other.”  However, as noted, “the proposal from the Republican-dominated House is already considered dead in the Democrat-dominated Senate and vice versa.”  So assuming the fiscal problem is deadly serious, as we believe, where does that leave the country?  And we are skeptical of the idea that the president is somewhere in the middle and will work to bring the members of Congress together, as implied by this statement: “President Obama’s toughest problem could be in getting Democrats to [consider?] an entitlement fix.”  Actually, in our opinion, the president is “leading from behind” in this situation, as exemplified by the fact that his own budget proposal – due by law in early February – is not expected now until April!  

3/13/13, Lawmakers face full slate: Markell: No help for port, A1/A6, Doug Denison – The governor disclaimed any intention of proposing $20M in the capital budget for the Port of Wilmington to make up for the collapse of the Kinder Morgan deal, pointedly criticizing union leaders for saying “they were not going to negotiate without having legislators in the room.  That’s not the way this is done.”  Julius Cephas’s response was “I’m sorry the governor feels that way.”

3/11/13, A10, “Too big to fail” now is “too big to jail” – The “too big to jail” slogan previously appeared in NJ columns by three different writers (Ted Kaufman 2/17/13; Simon Johnson 2/5/13; and Barbara Finnan 1/10/13).  Now it’s in an editorial, which cites recent testimony of AG Eric Holder about concerns that prosecution of big financial institutions could trigger shock waves in the global economy, etc. Senator Elizabeth Warren (D-MA) is quoted thusly: “that means they are being subsidized by about $83 billion a year by American taxpayers and are still not being held fully accountable for breaking the law.”  And a PBS Frontline documentary: “More than four years after the financial crisis, not one senior Wall Street executive has faced criminal prosecution for fraud.” Our thoughts: criminal prosecution is a blunt instrument that did not necessarily fit the situation, there has been an orgy of civil litigation, and we have seen no signs of government officials who contributed to the financial crisis being held accountable for their roles. Even assuming DOJ erred in not pressing criminal charges, moreover, Eric Holder’s comments might be viewed as an excuse versus a revelation.  As for the supposed $83B per year subsidy, here’s a description. The logic does not strike us as compelling.  Finally, it’s time to move on and focus on the next financial crisis – which is on the way because the government has not learned much from or responded effectively to the last crisis.

3/11/13, A11, noted in passing – (A) Peter Orzag (now an executive at Citigroup) laments “the diploma gap between the rich and the poor,” which he claims “undermines the traditional American notion of equal opportunity” and “represents a missed economic opportunity.”  Orzag seems to be making the common mistake of confusing equality of opportunity with equality of outcome.  Moreover, the soaring cost of higher education is in large part a function of government policies to subsidize student loans – and further government intervention is not likely to improve matters.  The keys to improving the results of the educational system are competition and choice, not government direction. (B) Samuel Lathem, president of the Delaware AFL-CIO would not only support increasing the Delaware minimum wage, but proposes a “livable wage” system that would “take into account items like fuel and housing costs – that don’t always go into cost of living indexes – but [livable wage systems] tend to be broader than a living wage, which uses family size to set the wage rate.  The writer envisions a two-tiered system, drawn along geographical lines: higher wages for northern Delaware (NCC and part of Kent County), somewhat lower wages for the rest of the state “where research has shown the cost of living to be lower.”  Would such a system “put people out of work and drive prices sky high.”  The writer denies it, saying many businesses have already pared employment to the bone so they can’t make further cuts and consumers could always drive elsewhere to spend their money if Delaware prices got too high.  We do not find such arguments persuasive.  A better approach would be to eliminate the minimum wage entirely and let the free market determine wage levels and employment decisions.

3/10/13, A1/A17, Kinder Morgan Deal: Port’s future at risk; State has no backup plan to keep it competitive, Aaron Nathans – Follow-up on 3/8/13 story re Kinder Morgan withdrawing offer to lease the Port of Wilmington and contribute to modernization and upkeep in coming years.  Notable points include the following: (1) Port board member Joe DiPinto, a former state legislator, cautioned opponents of the plan that alternatives may not be appealing.  “If we don’t grow, I don’t think the port will be operating in 10 years.”  (2) Ideally, the port needs berths along the Delaware River so deeper draft vessels can be unloaded.   Most of it is currently located on the relatively shallow Christina River.  However, it is said “hundreds of millions” would be needed, and the Kinder Morgan deal did not guarantee a Delaware River expansion.  (3) State did not include maintenance funds for the port in the current capital budget, assumed a lease deal would be struck.  Probably will be necessary to kick in $20M to keep the port going in the current configuration.  (4) Port director (and head of Delaware Development Office) Alan Levin considers the Kinder Morgan withdrawal final and is reportedly encouraging the port management to “refocus on gaining state funding for its day-to-day operations and repairs, rather than restarting a search for a long-term solution in the current hostile environment.”  (5) Longshoreman leader Bill Ashe said DiPinto would be proven right only if the state failed to keep up with port repairs, since in that case the facility would quickly be outclassed by the port of Paulsboro, which is being upgraded by the state of New Jersey. “Dole and Chiquita would leave in a heartbeat.”  Formerly a fuel terminal. Paulsboro is being converted into a general purpose port pursuant to a plan initiated circa 2005 and supported by a $135M bond issue that will be supplemented by some $250M in private investment. Is it just us, or does it seem like Delaware has been asleep at the switch in modernizing its port?  Might be an interesting study for Caesar Rodney Institute, which could suggest a path forward.

3/10/13, A24, Politics in a port deal are natural – The gist of this editorial seems to be that critics of the Kinder Morgan may have been overly confident about “the port’s future based on its intrinsic value” and their assumption that the state’s taxpayers “would be happy to come up with the money needed to modernize [the port] as necessary.”  Therefore, “a mechanism needs to be found to get all of them working together.”  We give up, what do the NJ editors have in mind? 

3/10/13, A2, For Biden chief of staff Bruce Reed, less is more, Josh Lederman (AP) – This profile of Bruce Reed, formerly a staffer in the Clinton White House and now Vice President Biden’s chief of staff, plays up both the vice president’s importance in the current administration and Reed’s reported access to the president.  Indeed, the story includes an 8/3/11 picture of Reed and the president sitting side by side in shirtsleeves and ties; according to the caption they were having lunch.  Before going to work for Biden, Reed was the chief of staff for the 2010 Fiscal Commission.  In this and other assignments, Reed is described as pragmatic and effective in working with people on both sides of issues.  Thus, Senator Mike Crapo (R-ID) is quoted as praising Reed for being helpful to the FC members in developing their ideas, “even if it wasn’t something he would support from his personal political perspective.” Perhaps, but the reporter goes too far in saying Reed “ran the [Fiscal Commission], tasked with forging a bipartisan deficit-reduction deal;” that role was played by Erskine Bowles and Alan Simpson.  

3/10/13, A9, In an improving economy, politicians looking for credit, Jim Kuhnhenn (AP) – With an upbeat jobs report, stock market run-up, etc., many feel the economy is on the mend.  However, some analysts have had the temerity to suggest that the public and business community may deserve more credit than the nation’s political leaders.  Although the role played by Federal Reserve highly relaxed monetary policies is noted, there doesn’t seem to be any acknowledgment of the downside risks of those policies.  Compare SAFE’s next blog entry. (3/11/13)

3/8/13, A4, Recent heat an abrupt reversal, Seth Borenstein (AP) – A new study in the Journal of Science “looking at 11,000 years of climate temperatures shows the world in the middle of a dramatic U-turn, lurching from near-record cooling to a heat spike.”  The study is based on “fossils of tiny marine organisms” and purportedly shows that the decade of 1900 to 1910 “was one of the coolest in the past 11,300 years” while the decade of 2000 to 2010 “was one of the warmest.”  However, as noted, global thermometer records only go back to 1880 – they are said to “show the past decade was the hottest [warmest?] for this more recent time period.”  Therefore, according to lead author Shaun Marcott of Oregon State University, “we’ve never seen something this rapid.  Even in the ice age, the global temperature never changed this quickly.”  And therefore “scientists say,” modern-day global warming isn’t natural, but [must be] the result of rapidly rising carbon emissions since roughly 250 years ago.” Hmm, wonder how the decade of 1900 to 1910 got so cold, when it happened long after the start of the Industrial Revolution.  Also, this report conveniently ignores the absence of any significant global warming over the past 16 years.

3/8/13, A1/A2, Port lease efforts dead; Kinder Morgan suspends talk, Aaron Nathans – Very briefly, Kinder Morgan lost interest in leasing and modernizing the Port of Wilmington as a result of union opposition (see 2/21/13 letter from the union president, Julius Cephas) and the intervention of the state legislature.  Not clear what the Plan B is for the state, which cannot readily come up with the required funds to proceed.

3/7/13, A6, House votes to prevent a federal shutdown, David Espo & Andrew Taylor (AP) – House passed a measure to extend current continuing resolution for balance of the fiscal year at the sequester-reduced level.  Vote was 267-151, with affirmative votes of over ¼ of Democrats voting [incl. Rep. John Carney of DE]. House Democrats are reportedly “torn between a desire to support legislation to keep the government open [after expiration of continuing resolution on March 27] and their goal of replacing at least half of the [sequester] spending cuts with provisions to increase revenue.”  There was also talk of FY 2014 budget proposal that is in the works (under the aegis of Rep. Paul Ryan), which will reportedly project budget balance within 10 years.  No mention of the president’s budget proposal, due by law in early February, which at last report will be released on March 25.

3/7/13, A11, Delaware is on its way to a lackluster future, John Stapleford (principal of DECON First, LLC) – Delaware unemployment rate was 6.9% in January 2009 and now, i.e., there has been no improvement despite marginal shrinkage in the state labor force.  DE policies have contributed to lack of progress, and the policies are locked in over the next several years.  (1) Raised top personal income, gross receipts, and franchise tax rates.  Also, DE businesses now face “a substantial bump” in workmen’s comp and unemployment insurance charges.  (2) DE ranks relatively low in public school test scores, with essentially no progress since 2007. (3) Higher than necessary energy costs.  CRI data show $38 million penalty in 2012 alone from participation in regional cap and trade scheme.  (4) “Almost 40 percent of all spending in Delaware originates from government.” Is that vastly different from other states?  (5) Middling to low scores in Illinois Policy Institute survey re job creation and Kaufman Index of Entrepreneurial Activity. (6) No right to work law, and state is considering raising minimum wage above national average.  (7) DE has “one of the most liberal Medicaid eligibility requirements in the nation and one of the highest enrollment rates.”  Experience shows “extreme [welfare] spending brings diminishing returns to economic growth.”  So we are doomed to mediocrity: not an inspiring message.

3/5/13, A1-A2, Altered climate softening winter’s blow: Delaware braces as storm winds up to deliver hit, Jeff Montgomery & Molly Murray – With global temperatures having plateaued over the past 16 years, attention has shifted from “global warming” to “climate change” (a more nebulous concept) and regional warming for the nation, the region, and the state of Delaware.  Instead of sharing in the general appreciation of a relatively mild winter, the reporters lament that it is “the eighth warmest on record” and express concern about a “large, snow-packing storm-surge blow” that may move into the mid-Atlantic region tomorrow.  But never fear: the state’s climatologist, UD Professor Daniel Leathers, says, “we’re in pretty good shape as far as the tides go.”  And “this year’s statistical uptick [in temperatures] comes as state environmental officials are in the midst of assessing climate change vulnerability.”  Accordingly, “renowned atmospheric scientist: Katharine Hayhoe at Texas Tech has been hired “to look at historic weather data and develop a Delaware-specific climate model to guide future decisions and preparation.”  (Hayhoe’s contract was reported in a 1/12/13 story by the same reporters.)  Re predicting weather patterns, gross errors have been made at the regional level as well as globally.  For example, there was talk a few years ago about how significant snow falls in the UK were a thing of the past (  Such predictions look silly after heavy snows blanketed the UK last winter and this one (  A companion article – Climate change might open Arctic routes; Shipping industry could benefit with savings in time, money, A2, Doyle Rice (USA Today) makes a point rarely made in the mainstream media, namely global warming could offer some advantages as well as drawbacks if further warming is experienced over the longer term.

3/5/13, A9, To create jobs, fund Del. capital projects, Brian McGlinchey & Marian Young – Delaware has a budget problem!  Disappointing tax revenue forecasts by Delaware Economic and Financial Advisory Council (DEFAC), partial repayment of unemployment funds to federal government, $63M income tax refund (still being contested), unknown trickle-down effect of budget cuts in Washington.  It may be “increasingly difficult to keep pace with the growing cost of education, Medicaid and the healthcare and pension costs associated with state employees.”  So DE should borrow to the max and invest the proceeds in “adequate roads, superior schools, attractive public amenities and sufficient infrastructure funds [handouts] to attract businesses.”  And while Secretary of Transportation Shaileen Bhatt has “done a terrific job righting the ship at Delaware Department of Transportation,” it’s clear that “significant restructuring or additional sources of revenue should shore up the Transportation Trust Fund.  OK, “only job growth in the private sector can truly grow Delaware’s economy” (a perfunctory statement to disarm fiscal conservatives) but the government “can take the lead in creating a nurturing economic environment by creating jobs through a vigorous capital investment program.”  Let’s prime the pump.  It’s time to act.  We think some government programs should be reined in, if necessary trimming retirement benefits and the like, instead of blowing the state’s financial position for an uncertain payoff.

3/4/13, A11, Failed cap and trade program to worsen, David Stevenson (CRI) – Delaware’s participation in the Regional Greenhouse Gas Initiative (RGGI), a “cap and trade” scheme that is being phased in over time, has produced: (A) no impact in reducing carbon emissions (the reduction observed was driven by cheap natural gas and reduced use of coal power), (B) unnecessarily high Delaware electric power prices, and (C) a stream of funds from the sale of emission credits largely wasted on renewable energy projects of dubious merit and administrative costs of the program.  Worse, it is now proposed to revise the program (e.g., speed phase-in).  See 2/17/13 story by Aaron Nathans. This could “increase ratepayer cost from about $6 million a year to as much as $38 million” and “will cost electric ratepayers $227 million by 2020 compared to about $40 million without the revisions.”  To ensure low cost and reliable power supply, new natural gas generation capacity needs to be built in the region.  And if it all gets built in states not participating in RGGI, e.g., PA and VA, Delaware will continue to pay the extra cost for imports on the interstate grid vs. benefitting from the lower-cost capacity.  The legislature erred by delegating so much power to DNREC, and it should act now to ensure legislative oversight of revisions to the program.  Makes sense, but we would express the conclusions more bluntly.  The best course for Delaware would be to exit the RGGI and abort the Sustainable Energy Utility (SEU) requirements for Delaware utilities.  Failing that, DNREC’s asserted power to speed up the phase-in requirement should be cancelled.  Logic: SEU is a tax; taxes should only be imposed or increased by the legislature.  


3/3/13, coverage of sequester that went into effect yesterday shows reluctance to face gravity of fiscal problem(A) Gridlock’s impact felt beyond [Dover] base, A1/A14, William McMichael – First, the sequester is said to have resulted because “President Barack Obama and Congress failed to reach an agreement,” which implies – like the headline – that the problem was simply political gridlock. It would be more accurate to say Side A refused to recognize the necessity of spending cuts and therefore would not negotiate in good faith. Second, the prime focus is on family budgets of government employees, ripple effects on local economy.  Shouldn’t the top concern be potential damage to military effectiveness and national security? (B) Sequestration “tough medicine” for US, A21 “Who did this?” asks the editorial. There is talk about how politicians on both sides played the blame game, doing “their best to spook all of us,” while failing “to come up with a vision for refueling our economy with a new competitive workforce.”  Accordingly, “our spending choices are fewer,” and the public either gets it now or soon will as they swallow the “strong medicine” of the sequester. Which leads to this answer to the opening question: “We will remember who did this to us – ourselves and those we elected.  It’s a shared responsibility, one that we get to reassess at the polls in the coming 2014 midterm elections.”  If one concludes that Congressional Republicans forced this answer on the nation by their arrogant refusal to compromise with the president, such an answer may make sense.  Otherwise, it’s a non sequitur because the president will not be running for reelection in 2014.  For our views on the sequester, see the forthcoming blog entry, We can’t keep spending like this, 3/4/13.

3/3/13, at last some common sense about Keystone pipeline?: (A) Boehner: No reason to block Keystone oil pipeline, A9, Matthew Daly (AP) – This story includes a photo of Secretary John Kerry, speaking with reporters during a Feb. 8 news conference with Canadian foreign minister John Baird.  And the story begins with a draft report of the State Department staff, which pipeline supporters see as offering hopes of a favorable answer on the latest iteration of the pipeline proposal.  The key points: “no significant environmental impact to most resources along the proposed route from Western Canada to refineries in Texas” and “other options . . . are worse for climate change.”  OK, this should clear the way for quick approval, says House Speaker John Boehner, but environmentalists – who reject the premise that the Alberta tar sands will be developed whether the Keystone Pipeline goes through or not – strongly disagree.  (B) Crowd numbers show organizers’ bias, A21, Wayne Rutman (Wilmington) – The writer criticizes News Journal’s coverage of a recent anti-pipeline rally in DC - 2/18/13, A1/A2, “Going to be heard”: Delawareans join 35,000 activists at rally to urge rejection of oil pipeline, Molly Murray – pointing out that the attendance estimate was provided by the event organizer and citing other sources who thought the true figure was much lower. We are not so sure about quick approval – An update on the Keystone Pipeline, (2/25/13) - but would be delighted to see it.

3/1/13, A11, There’s more than the sequester left to resolve, Michael Begato (Delaware Public Employees Council 81, AFCSME, AFL-CIO) – According to Mr. Begato, the “fiscal cliff” deal (ATRA) raised tax rates on the richest, raising $620 billion over the next decade. “This was the first revenue boost in the two-year history of debt deals,” the writer continues, “after $1.5 trillion in spending cuts . . . a two-and-a-half-to-one imbalance.”  Clearly, spending cuts “should not be the [principal] source of deficit reduction” going forward, nor cuts in Social Security, Medicare and Medicaid either. The indicated answer is more tax increases “for the ones who actually have contributed to our deficits and have been flying high over [the past 30 years].”  So let’s make tax deductions less valuable for the rich, raising $500 billion for deficit reduction over the next 10 years, and end the “accounting tricks that allow companies to hide profits and ship jobs overseas [to] save hundreds of billions more.”  Here’s to “our own Tom Carper” who was one of the handful of senators who voted against ATRA.  Part of Carper’s stated reason for his vote was “that the bill did not raise enough revenue” and “we should all be proud of him for taking this stance.”  Now, “with the revenue debate shifting to corporations,” all three members of Congress from Delaware should “be leaders on sensible corporate tax reform, reform that not only improves the system but results in higher revenues to tame our deficits.”  This column overlooks (A) the positive economic potential of revenue neutral tax reform (for corporations and all individual taxpayers), and (B) the economic drag effect of further tax increases.  The fiction that spending has already been cut $1.5 trillion is accepted hook, line and sinker.  Even the $620 billion increase in projected tax revenues under ATRA is mischaracterized; this figure includes anticipated proceeds from allowing the temporary payroll tax cut to expire. 

2/28/13, A11, Proposed Social Security plan will cut into seniors’ benefits, John Walsh (DE AARP) – The writer lucidly explains that Social Security benefits are important for seniors, many of whom don’t have much else to live on.  He goes on to argue that “we need to be vigilant and well-informed about attempts to cut our hard-earned Social Security” and launches a preemptive attack on a plan “circulating in Washington” to switch to a “chained CPI” for calculating cost of living adjustments to benefits. Some may consider this procedure a more accurate adjustment for inflation, but Walsh sees it as “a significant benefit cut” that “would get deeper each year as we grow older.”  And hey, “Social Security is a self-financed program that provides earned benefits. It didn’t cause the deficit, and shouldn’t be cut to fix Washington’s budget problem.”  So, for politicians who previously vowed “never to cut Social Security for today’s seniors” but may be wavering now, here’s a friendly warning: “Make no mistake, we will be watching closely.”  SAFE agrees that seniors are relying more and more on their Social Security as other sources of income are eroded by inflation (which could get far worse).  Furthermore, a chained CPI would certainly represent a “cut” versus current procedures.   As for the claim that Social Security is a “self-financed program,” it could more accurately be described as an intergenerational Ponzi scheme.  Social Security outlays are contributing to the overall deficit, and they should not be considered “off the table” in discussions of how to address the fiscal problem.   

2/28/13, A10, Time to take keys away from our politicians, David Ignatius (Washington Post) – Who is to blame for the sequester that is about to crimp the rate of growth of federal government spending?  The writer sees “a political system that is the equivalent of a drunk driver” and places primary blame on the Republicans because “they are so intoxicated with their own ideology that they are ready to drive the nation’s car off the road.”  Maybe the sequester will produce a little crisis, maybe a big one, but “the sad fact is that the Republicans don’t know either; yet they’re still willing to put the country at risk to make a political point.”  So what’s the answer?  The president “should take the steering wheel firmly in hand and drive the car toward the destination where road maps show we need to be heading – namely a balanced program of cuts in Social Security and Medicare and modest increases in revenue.”  Too bad, “Obama has chosen to be co-dependent” in psychologist speak.  Thus, “he double-dared the reckless Republicans by proposing the sequester in 2011” and “tripled-dared the GOP hotheads with a partisan inaugural address and weeks of what the Republicans rightly have called a ‘road show” of blame-game politics.”  But “it’s wrong to say that both sides are equally to blame for what’s about to hit us,” and the Republicans – having forsaken the compassionate conservatism of George W. Bush and the willingness to govern across party lines shown by John McCain – “seems to suffer from what’s sometimes known as Obama Derangement Syndrome, in which their hatred of the president blinds them to the country’s interests.”  Politics aside, the writer argues, “there is every reason to be optimistic about America’s future.”  So given “the breakdown of our political system,” the time has come “for an intervention, to take the keys away.”  Talk about looking at the facts and drawing the wrong conclusion!  We should be thankful that the political system is still working – does Ignatius really want to see it replaced with a dictatorship?  And raising taxes will not cure the spending addiction that threatens the nation’s future, nor is there any limit to the demands for “more revenue” no matter the soothing adjectives (a little, modest, etc.) that are employed. The transformation of this country that is contemplated would require a lot more revenue, and not just from the well-to-do either.  What’s more, the long-term consequences would be national decline.

2/28/13, A1/A5, Oil tank gripes fire up meeting; Rise in train deliveries draws ire of neighbors, Jeff Montgomery & Melissa Nann Burke – See 2/10/13 story by same reporters on same subject, namely growing volume of heavy oil shipments coming in from Canada to the PBF refinery vs. shipments from Venezuela, etc. via tanker.  Now we read that over 150 people “jammed the Wilbur Elementary School cafeteria to hear and discuss the concerns during the community meeting – arranged by local lawmakers – with PBF Energy and Norfolk Southern representatives.”  The refinery and railroad need to minimize the disruption and annoyance concerns being expressed, and maybe a pipeline would make economic sense at some point.  But there is no such thing as a 100% trouble-free refinery, and the public needs to keep the resultant economic benefits (jobs, affordable motor fuel) in mind.

2/27/13, A1/A2, Markell seeks more jobs for disabled, Nicole Gaudiano – As chairman of the National Governor’s Association, Gov. Jack Markell is championing the idea of supporting jobs as the “preferred outcome” for the disabled.  According to this report, “the United States spends $300 billion a year to support unemployed people with disabilities,” so there is ample fiscal incentive to support the idea – as well as the humanitarian aspects.  However, let’s not forget the policies that are resulting in people going on disability – relatively high minimum wage prices them out of jobs, and loose control over Social Security disability awards, which basically pays them for not working.  Also, the more requirements are placed on business firms, the more likely that hire the disabled programs will have a net negative effect.

2/27/13, A13, Big business must pay its fair share in future deals, Jason Scott (CEO of a Smyrna publisher named Prestwick House and a member of American Sustainable Business Council) – While professing to be pro-business, the writer contends that big corporations are shamelessly evading taxes – including blue chip icons like GE and DuPont, collectively referred to as the “Dirty Thirty” – by “a shell game: using accounting tricks to move money around the globe with the click of a mouse, claiming income was produced in places like the Cayman Islands with low or no taxes even if the corporation’s only presence there is a post office box.”  Meanwhile, back at home, we the suckers get stuck for the tab of the infrastructure and programs that make the corporate success possible.  And we’re not talking about peanuts.  Thus the US Public Interest Research Group reports that offshore tax loopholes (used by both corporations and wealthy individuals) cost the federal government $150B last year, and Delaware alone lost out to the tune of $220M.  Thus, between 2008 and 2010, “DuPont alone made more than $10 billion in profit, and got $72 million in refunds.”  So, hey, why do we short government spending, or hike middle-class and small-business taxes, “or go deeper in debt, all in order to allow huge, profitable corporations to continue to shirk their taxpaying responsibilities”?  Claimed ease of shifting profits is unrealistic; has the writer never heard of Section 482, Subpart F, and other provisions of the US tax law aimed at such abuses?  Much of a global company’s profits are earned offshore and subject to foreign income taxes, so one would need a lot more data than total reported income to draw conclusions.  And to the extent that some companies have effectively been exempted from paying US income taxes on US profits, this is probably due as much to special tax preferences, e.g., renewable energy credits, as to dubious tax manipulation.  Said preferences should be eliminated as part of the corporate tax overhaul (including fully offsetting rate cuts) that is so clearly needed to help revitalize the economy. 

2/26/13, A8, When your opposition hurts you – This editorial suggests that even GovCare foes should find reasons to go along with it, citing Governor Scott Walker of Wisconsin for his “walk back on a refusal to participate in the program.”  Here is a coherent description of what happened, which doesn’t sound much like a “walk back” to us.  Basically, Walker’s approach is to move people above 100% of the poverty level, previously eligible for Badger Care (but in many cases not participating due to a sign-up freeze), into the federally run HCI exchange that will be set up under GovCare in 2014.  The net effect would be to reduce the number of people without healthcare insurance while achieving modest savings for Wisconsin.

2/26/13, A9, When presidents can’t wait and act on their own, Cass Sunstein (Harvard Law) – Prof. Sunstein argues that the president is not guilty of overreach as other presidents (notably Carter, Ford, and Reagan) issued more executive orders than he has.  And even if you look at the substance rather than the mere number of executive orders, and factor in executive memoranda and departmental regulations as well, the president has typically been able to show Constitutional or Congressionally-granted authority for his actions.  Thus, the EPA is clearly authorized to restrict CO2 emissions as pollutants because Supreme Court decision said so – whether this represents good policy or not.  And never mind that a federal appeals court struck down the president’s “recess appointments” of three NLRB members; “that ruling is controversial” – “the Supreme Court might ultimately reject it” – and finally, as the ruling shows,  “courts are available to police executive actions.” This is the first acknowledgment of the ruling we have seen in the News Journal, aside from a SAFE letter about the lack of coverage.  See also a “shepherds and sheep” column by Thomas Sowell re the weakness of another slick Sunstein argument: government should make decisions for people who will make some “mistakes” if left to their own devices.  As Sowell points out, government decisions are made by people too, the mistakes can be huge, and the decision makers are not readily held accountable.

2/26/13, A9, Consider tax rebate for consumers this summer, A9, Larry Seidman (UD economist) – This column is in the same general vein as a pre-election column (9/10/12) by Seidman blaming Republicans for shortchanging the fiscal stimulus needed to combat the Great Recession.  This time, Seidman decries the recent increase in the payroll tax (it was cut by two percentage points for 2011 and 2012) and argues that “the economic recovery urgently needs strengthening.”  His proposal: a scaled-up ($300B) version of the 2008 tax rebate (under the Bush administration) –  half of the 2008 rebates were spent within 3 months of receipt – which should get the economy moving again.  True, the rebates would add $300B to the FY 2013 deficit, but no matter because “when the economy is weak, the first priority should be to boost consumer spending in order to stimulate production and create jobs.”  Later, after “a strong recovery takes hold and the unemployment rate comes down to normal” (say 6% or below),“business confidence” will return to normal and there will be adequate private sector spending without stimulus.  To reassure “the public and [the] financial markets,” the recommended “grand bargain statute” would include “a normal unemployment balanced budget rule (NUBAR).”  We don’t share Professor Seidman’s confidence in the beneficial effects of deficit spending.  Furthermore, one shudders to think of the games that would be played to avoid achieving a 6% of unemployment rate that would trigger the NUBAR.

2/25/13, Governors Jack Markell (DE) and Scott Walker (WI) appear on Fox News Sunday – We were surprised nothing was said about this interview in the News Journal; it provided an informative statement of contrasting views.  Thus, Markell toed the party line that a deal to replace the sequester would necessarily include tax increases while Walker pointed out that such a result was never intended so he is “a little confused” about the idea.  Similarly, Delaware will expand Medicaid coverage as contemplated by the GovCare legislation, expecting to profit from increased federal funding, whereas Wisconsin will decline to do so. Asked to reconcile his conclusions with those of Governor Markell, Walker diplomatically observed that “every state is different,” e.g., the details of the Medicaid programs for the two states diverge in various respects.  Walker also conceded his belief that with a $16.5 trillion debt the federal government might not make good on its promise to cover 100% of the expansion costs for three years and 90% thereafter. Here is a transcript (scroll down, it starts with a previous interview of Senators Tom Coburn and Claire McCaskill).

2/23/13, A1/A5, Markell: Tough choices coming; $17.8 million on line in sequester talks, Jonathan Starkey – In conjunction with his stint as head of the National Governor’s Association, Governor Markell reportedly got some face time with the president to talk about the looming spending sequester, etc.  For this year, DE could lose $17.8M in federal funds, notably in education,  health & social services, and defense.  Markell is not ruling out the possible need for layoffs. 

2/23/13, A1/A2, Critical delivery: Sen. Carper throws energy into Postal Service compromise as time ticks away on Saturday mail, Nicole Gaudiano – Eliminating Saturday mail would not solve all the USPS’s problems, but it would be a step in the right direction – and Postmaster General Patrick Donahoe wants to do it.  Some members of Congress (principally Democrats) are trying to block the move, and Senator Carper is working on a compromise that he hopes to get done before August that would put this decision off for a bit while subsidizing buyout offers to encourage early retirement decisions and trim the payroll.  Rep. Darrell Issa called the Carper bill “wholly unacceptable” last year, both due to cost and its delay of operational adjustments, but talks will continue in a search for common ground. 

2/23/13, A8, Fixing the tax system one small step at a time – According to this editorial, House Ways and Committee Chairman David Camp (R-Michigan) has been doing some spadework for a much-needed reform of the tax system even though the work may not come to fruition in 2013.  Camp’s goal is simplification and he reportedly wants to see the system work better.  Go to it!  We agree, and have repeatedly urged Rep. Camp et al. to get to work on this subject instead of waiting for a “perfect opportunity” that somehow never materializes.

2/23/13, Book helps to explain nation’s debt, A8, Larry Koppenhaver, New Castle – This letter essentially repeats Gemma Buckley’s 2/16/13 attack on Wayne Smith’s flat tax column, again calling Smith “a lobbyist” and citing a book entitled “The Betrayal of the American Dream.”  The writer recently recommended this book to 60 students in a class at the Lifelong Learning Institute as a means of catching  up on “what you might have missed about taxation and free trade during the past 40 years.”  Thus, re taxation, “you will gain understanding of how the 1 percent have gained 90 percent of the nation’s wealth.”  Is that a fact?  And if so, would Smith’s flat tax make things better or worse?

2/23/13 –Taxpayers will suffer for minimum-wage increase, A9, Edward Glaeser (Harvard economics professor, Bloomberg View columnist), 2/23/13.  The writer rightly condemns “policies that make politicians look caring without requiring them to pay the cost of justifying higher taxes.”  But having the government pay lower-paid workers the $1.75 difference between the proposed and current minimum wages wouldn’t be a whole lot better.  If one believes in market economics, there should not be a minimum wage at all.  And raising the taxes of some people to pay higher wages to other people sounds a bit like theft.

2/23/13, B1/B2, Energy efficiency urged; Markell speaks at climate conference, Jeff Montgomery – Governor Markell gave a keynote speech yesterday at the second day of a Georgetown [Law School] Climate Center workshop.  In brief: Global-warming driven climate change – more extreme storms, sea level rise, longer droughts,  wildfires, changes in agricultural patterns - cleaner and more efficient energy sources – need for government leadership – ways for states and federal government to cooperate in developing a future with drastically lower emissions  “I think people are paying more and more attention to climate impacts than ever before because of many of the things that have happened to many of us.”  And “we’re experiencing exactly what so many of the models predict and suggest that we should be experiencing.” So let’s “just say the science is settled and the data is overwhelming” and move on to a glorious future in which “we can actually accelerate economic growth in our states by supporting the construction and manufacturing jobs in energy efficiency, clean energy and advanced transportation.” Sadly, as we understand it, the “conventional wisdom” about global warming (aka climate change) is being taught in Delaware schools.  It is also characterized as factual by our local newspaper and parroted by many political leaders including Delaware’s governor. An update on the Keystone Pipeline, 2/25/13.

2/23/13, A4, stray advertisement – Despite yesterday’s story about the forced closing of Pencader Charter School in June, an ad ran in today’s paper announcing the school is “currently enrolling for the 2013-2014 school year.”  Among the selling points: “97% of graduates enrolled in colleges” and “excellent AP scores.” Also a student testimonial: “We are more than a school, we are a family!” Presumably the ad was previously arranged and someone forgot to cancel it, but the error seems unfortunate

2/22/13, A1/A2, State monitors flunk Pencader; Loss of charter will force troubled school to close, Nichole Dobo – Since Pencader Business and Finance School opened in 2006, it has been on review or on probation for much of the time.  And yesterday the state Board of Education voted to close the school based on the recommendation of Secretary of Education Mark Murphy.  According to the story, “Murphy said Pencader’s team did not submit a plan that addressed concerns communicated to them by the state, including improving student performance, strong governance of the school, and a plan for recruitment of more students and a new school leader.”  And John Carwell, director of the charter school office in the Department of Education complained that the new school’s leadership submitted plans for moving forward that contained errors and omissions, e.g., represented that the school outperformed the state average on student achievement tests whereas it was actually below the state average on math and reading assessments. According to state officials, the school will close in June; there is apparently no possibility of a reprieve.  Special support will be provided to parents who are trying to determine where their children should go to school next year, e.g., Murphy said “the state Department of Education will set a time to meet with families within a week.” It is hard to assess the charges against Pencader without more information, but we are inclined to be skeptical.  According to earlier reports, Pencader DID recruit a new school leader with excellent credentials as well as a new board chairman.  These individuals were given essentially zero time to have an impact.  One might infer that the DOE had already decided to close the school and was simply going through the administrative motions to do so.  Maybe the idea of a school dedicated to students interested in preparing for a business career was too much for someone in the DOE hierarchy. 

2/21/13, A7, Obama’s views preferred to GOP’s, Susan Page (USA Today) – “On the legislation rated most urgent — cutting the budget deficit — even a majority of Republican voters endorse Obama's approach of seeking tax hikes as well as spending cuts.”  One might wonder about this report, since (a) 70% think deficit and debt must be dealt with this year, (b) and the president is doing his level best to block any significant spending cuts.  Maybe the disconnect is between what the president says he wants and what he is actually doing.  But in any case, here’s a link to the story in USA Today, decide for yourself.

2/21/13, A12, Obligated to respond to climate change, John Irwin (Wilmington) – It’s been so hot in the contiguous United States and Delaware, and “high temperatures can cause deaths of poor and elderly people who don’t have easy access to air conditioning.” What about fewer freezing deaths in the winter?  97% of “peer-reviewed scientific articles about climate change agree that human production of carbon dioxide is the dominant cause.”  Accordingly, “to not act on that degree of agreement is reckless endangerment [using the argot of criminal law] and irresponsible.”  Bully for the “concerned citizens from around the state” who went to DC to participate in the Feb. 17 rally against “the Keystone XL pipeline from Canada that does the exact wrong thing by facilitating the burning of the worst carbon emitting fossil fuel yet.” More carbon content than coal?  

2/21/13, A13, Lessons for strong local economy and Port of Wilmington, Julius Cephas (president of the 1694-1 International Longshoreman’s Union)– One gathers that the writer does not like the proposed contract for pipeline giant Kinder Morgan to kick in some $200M to upgrade the Port of Wilmington and operate it for 50 years.  Thanks to the outpouring of community support, Senate Bill No. 3 will ensure legislative and public oversight of the deal.  More generally, “strong unions working in solidarity through collective bargaining are critical for rebuilding a strong middle class here in the US.”  Yet, “the perceptions of unions in the US are abysmal and we are often seen by companies as an adversarial inefficient cost factor that diminish [es] business marketplace competitiveness in the global economy.”  Does the behavior of unions in any way justify these perceptions?  We could do with some respect, like unions enjoy in Germany.  By the way, Germany produced twice as many cars as the US (5.5M vs. 2.7M) in 2010, and enjoyed double the average compensation ($67 an hour vs. $34 an hour). We wouldn’t bank on these statistics, especially the relative number of cars produced; is the writer leaving out cars produced by Toyota et al. because their plants are not unionized? Witnessing thousands gather in Washington, DC for the “Forward Climate Change” rally against the Keystone XL Pipeline was “awe-inspiring,” and “I am excited about the potential opportunities for increasing high skilled union jobs in the clean and renewable energy sector at the Port of Wilmington and at other local businesses throughout the state which is true representative democracy at work.” Unions who might be involved in building and operating the pipeline have a different view of the matter.

2/20/13, SAFE and allies participate in public hearings – It wasn’t reported by the News Journal, but we had a burst of activity yesterday: (A) Sunset Committee: Advocate under review; Joint panel eyes state consumer watchdog, A8/A9, Aaron Nathans – As reported, some lawmakers are saying “the office [currently headed by Michael Sheehy] hasn’t pushed back hard enough against regulated utilities like Delmarva Power.”  Critics include Rep. Gerald Brady and Rep. John Kowalko (see 12/14/12 entry re his complaints about the PA).  Unsurprisingly, the PA office disagrees and claims to have “saved consumers a collective $50 million, based on what utilities originally asked for in rate cases.” No surprise here, as Delmarva Power et al. probably ask for more than they expect so the Public Service Commission can justify its existence.   But the problem goes deeper than being too lenient with the utilities; as civic advocate John Nichols suggested in his statement (he was the only representative of the public present), the PA has also shown little inclination to question state government policies like the Bloom Energy deal and RGGI/SEU, which are driving up electric rates.  Unless the PA can be redirected to serve as a true consumer advocate, possibly by making the office elective versus appointive, the office might as well be eliminated.  (B) Second engagement session on the sea level rise adaption options identified by the SLR Steering Committee was held in New Castle County.  The first was held in Sussex County; see 2/14/13 entry.  In lieu of a story, the News Journal posted a 2-minute video on line.  SAFE director Bill Morris and SAFE ally John Greer appear in the opening shot, looking at one of the displays.  Later on, in an interview, Greer can be heard stressing that the real problem is coastal storms – not a radical increase in the average sea level.  However, most of what Greer said – notably that sea level is rising only about 1 foot per century, but DNREC is making plans for 5 foot per century – was edited out.

2/19/13, A1/A5, Minimum wage debate: “People fighting . . . just to survive”: Business groups lining up to oppose Delaware increase – A proposal to raise the minimum wage in DE from $7.25 to $8.75 an hour, and index the new rate for inflation, is being pushed by Sen. Robert Marshall (D-Wilmington).  Last year, the bill passed in the Senate but died in the House.  Governor Markell has not committed himself.  Various business groups are reported to “lining up against the state proposal,” which they argue would work against efforts to get idled workers back to work.  But Marshall contends that a hike in the minimum wage would boost the economy because “any increase in income ends up being returned to the economy in terms of purchases.”  By that logic, why stop at $8.75 an hour? Set the minimum wage at $20 an hour and see how prosperous we will all be!

2/19/13, A1/A2, Larger storms, but less snowfall; Warmer atmosphere to create contradiction, Seth Borenstein (AP) – A dedicated climate alarmist argues, yet again (his articles have appeared in the News Journal frequently), that we are in for more “extreme weather” as a result of inexorable global warming.  Studies are referenced showing that there can be less snow overall (due to warmer weather) coupled with more heavy snowfalls (due to more moisture in the atmosphere as a result of warmer weather, which will fall as snow if it is cold enough).  What a revelation! Borenstein includes the usual disclaimer designed to disarm skeptics: “Scientists won’t blame a specific event or even a specific seasonal change on global warming without doing intricate and time-consuming studies.  And they say they are just now getting a better picture of the complex intersection of man-made climate change and extreme snowfall.” The story begs two questions: (A) Is there indeed a warming trend – which will inevitably continue or accelerate as a result of carbon emissions from burning fossil fuels – or will the future trend be less certain and/or dramatic?  (B) Are shifting weather patterns in the continental United States necessarily representative of the overall global trend?  Russia and China are having a record cold winter this year from what we’ve read.

2/19/13, A9, Let Pencader Charter keep moving forward, Frank McIntosh (the new School Board head); A8, Vote to keep Pencader Charter school open –McIntosh argues persuasively that Pencader has made great strides “since Nov. 11, when I took the reins as president of the board and our new team was assembled.”  And the accompanying editorial urges the state Board of Education “to allow Pencader to continue operating” because “it has willingly and thoughtfully made the necessary changes to earn a reprieve.” We would hope this will be the outcome.  If not, the Board of Education had better be prepared to explain themselves.

2/18/13, A1/A2, “Going to be heard”: Delawareans join 35,000 activists at rally to urge rejection of oil pipeline, Molly Murray – Front page pictures: (A) Ground level panoramic view of protestors massed on the National Mall (taken from close up so it looks like there a lot of them), Washington Monument to the rear; (B) Chrissy Frick of Wilmington, taking part in the rally, is displaying a DE “Climate Justice” poster.  Page 2 picture; Kristina Lynn of Delaware “was among the many activists from Delaware participating.”  She is shown holding a “Forward on Climate” poster with “Delaware” and some more text that is cut off.  The purpose of the “climate activist” rally was “to press President Barack Obama to reject the proposed Keystone XL oil pipeline.” The “We are going to be heard” line was provided by one of the speakers: US Senator Sheldon Whitehouse (D-RI). “Over 120 people” from Delaware (two buses plus car pools) are said to have participated.  What was motivating them? Here are some sound bites: Bernie August, Newark: Believes refining heavy Canadian crude (which regardless of source is the type of oil the PBF refinery at Delaware City was built to refine) is water-intensive and could deplete the water supply.  “The people of Delaware were not asked whether they wanted that refinery to reopen.” Peter Sullivan, Middletown: “I think we need to reduce fossil fuel consumption across the board.”  Local organizer Stephanie Herron: Even scientists in the federal government worry that extracting oil from tar sands would have huge implications for climate change because it would release trapped carbon into the atmosphere.  If this oil doesn’t go to the US, it will be shipped to China.  The reporter notes contrary viewpoints in a single sentence: “Proponents of the pipeline say it will increase North American oil production, decrease dependence on foreign oil and produce jobs.” Oh well, what difference does economic reality make?     

2/18/13, A8, “Manufacturing hubs” worth support – Editorial focuses on this particular proposal in the SOTU address: “Manufacturing hubs, where businesses will partner with the Departments of Defense and Energy to turn regions left behind by globalization into global centers of high-tech jobs,” suggesting that the proposal deserves serious consideration.  After all, “to a great extent,” the hub concept (industry, universities and governments working together in specific fields) is already happening “both in Delaware and throughout the region.”  Queries: (1) Can federal government afford to spend even more money on this sort of activity than it is already doing?  (2) Who needs more subsidies for wind and solar energy?

2/18/13, A9, Congress must address new normal in job creation, Robert Shapiro (chairman of Sonecon, a DC economic advisory firm) – Statistics are cited re slower than hoped job growth after economic slumps in both the Bush and Obama administrations, which purportedly show that technology gains and global competition are making it harder to create jobs than it used to be.  Right or wrong, others have made the same point; the question is what could or should be done about it.  Shapiro’s big idea is to “directly reduce the cost for business to create more jobs” by, for example, cutting the payroll tax for employers and making up the difference for the Social Security trust fund with “a modest carbon or value-added tax.”  What about doing away with the minimum wage, cutting back on welfare benefits that enable millions of Americans to get by without working, building the Keystone pipeline, etc.? 

2/17/13, A6, As Alzheimer’s rate soars, concern rises over costs, A6, Janice Lloyd (USA Today) – According to the Alzheimer’s Association, “care for patients with Alzheimer’s and other forms of dementia will increase 500 percent by 2050, reaching $1.1 trillion” in 2012 dollars.  About 70% of costs of Alzheimer’s care “are billed to Medicare and Medicaid.”  Needless to say, no one has figured out how the bill is going to be paid, although “the government last year set a goal of developing preventive treatment of Alzheimer’s by 2025 and increased research funding through the National Institutes of Health to $606 million last year, exceeding $500 million for the first time.”  Hmm, is it really like that this research spending will have a huge fiscal payoff in the future? 

2/17/13, A25, Keeping the Wall Street crooks out of jail, Ted Kaufman – Basically covers the same ground as a 2/5/13 column entitled “Who decided US megabanks are too big to jail?” and advocates, as did Simon Johnson of the MIT Sloan School, a continuing vendetta against Wall Street – including criminal prosecutions on top of the barrage of multibillion dollar civil suits that have been brought.  “Nothing I have seen in the past four years,” says Kaufman, leads me to believe that Wall Street as a whole learned much from the events of 2008-2009.  The government’s bailouts . . . pretty much forgotten . . . multimillion dollar bonuses are back with a vengeance . . . incentives to cut corners and, for some, to circumvent the law.”  Hmm, doesn’t Kaufman claim to believe in the free market system?  And does he acknowledge that government officials made some big mistakes too? We didn’t notice any discussion about that.

2/17/13, A25, Sequestration hurts Delaware education innovation, Patrick Harker (UD president) – The column begins with potential cuts to preK-12 education spending, but eventually gets to what is probably the writer’s primary concern.  “Blunt reductions” to the budgets of “UD’s biggest federal granting agencies . . . National Institutes of Health . . . Department of Energy . . . National Science Foundation” could force UD “to absorb $5.5 million in research expenditure cuts over the next seven months, with deeper cuts to come.” Accordingly, “we need discriminating deficit-reduction solutions – solutions that strengthen Delaware’s job-creating economy-growing enterprises.” Granted, targeted spending cuts would make more sense – but so far, Congress has not been willing to step up to the plate.  Time will tell whether that changes. We don’t buy Harker’s assumption, however, that UD’s budget should be considered sacrosanct.  For example, what about all the wind power research?

2/17/13, E1/E6, Tighter caps may aid Del., Aaron Nathans – The 10-state Regional Greenhouse Gas Initiative (RGGI) set a goal of reducing manmade CO2 emissions in the region to 165 million tons a year because “scientists say” CO2 emissions are “the leading cause of climate change.”  Come to find out, an economic recession plus greater use of natural gas (thanks to the fracking boom) has brought regional CO2 emissions to “an even lower level – 91 million tons.”  Are supporters of the program happy?  Heck no, they now want to lower the cap to the current level, thereby “requiring generators to keep reducing emissions even as economic activity grows.”  Presumably this would increase the market price of emission permits, great!  DNREC Secretary Colin O’Mara believes Delaware can make the change without legislation, i.e., by administrative action, although public hearings will be required.  And he is quoted that the current cost of this program “to the average resident within the state is 38 cents a month,” so obviously no one should be concerned about the matter. Whatever the cost is assumed to be, in our opinion, it is too high for this wasteful program.

2/16/13, a sampling of progressive thinking: – (A) Fiscal uncertainty adds to economic gloominess, A8 – Gee whiz, says this editorial, there is a lot of anxiety about the fiscal problem these days – and to some extent it could do “genuine damage.” Notably, “the partisan and ideological split between the Democrat-controlled Senate and the Republican-controlled House” will result in the sequester going into effect as of March 1 “unless some kind of agreement is reached,” and the CBO estimates that this would “shave points off the annual economic growth rate.”  (B) Flat tax would be unfair to working people, A8, Gemma Buckley, Wilmington (former Delaware Common Cause president) – Takes issue with Wayne Smith’s flat tax column on 2/4/13, referring to him as a “lobbyist” and says our convoluted tax system is “the result of plutocracy.” Specifically, “the richest 1 percent of Americans has influenced Congress, mainly through lobbying and campaign contributions over the past 40 years, to pass legislation that benefits them exclusively.” If you don’t believe it, read “The Betrayal of the American Dream” by Donald Bartlett and James Steele.”  So, yeah, let’s eliminate all the loopholes but have “multiple rates that would escalate with higher gross earnings.”  Maybe, but we wouldn’t expect to agree with the writer on the specifics.  (C) Obama winning the argument on government, A8, Eugene Robinson – This column compares President Obama to Maggie Thatcher – who, in her time and country, challenged worn out ideas and won the argument.  Seems like a far-fetched analogy to us, and if the president is “winning the argument” with the kind of ideas he threw out in the State of the Union address (see forthcoming 2/18/13 blog entry) this country is in serious trouble.  (D) Delaware needs to act quickly to secure national park, A9, E. Andrew Sabatino Jr. (CEO of EDIS Company) – This column argues that the designation of Woodlawn as part of a Delaware national park “provided a perfect fit with Sen. Carper’s other historic sites” and – in combination with a precedent-setting gift of over $20M from Mt. Cuba Center to expedite the property transfer – can provide “the necessary momentum to push a national park across the finish line.”  But things could get stalled, so “I urge Vice President Biden, Sens. Carper and Chris Coons and Rep. John Carney to move quickly to secure the recognition that our state so richly deserves and has waited so long to achieve.” Given the fiscal problem, this proposal should be dropped.  If Delaware wants to establish more state parks and can cover the cost, fine.  

2/14/13, A1/A2, Climate change: Input weighs coastal effect; State session has a crowd, Jeff Montgomery – A 3-hour “engagement session” on sea level rise in Lewes was attended by over 100 people.  The event covered “draft options of dealing with accelerating coastal erosion as well as expected storm and flooding threats as global warming changes the world’s climate and oceans.”  DNREC’s 24-member Sea Level Rise Advisory Committee is hoping to complete “a three-year adaptation planning effort” by this summer based on “expectations that rising temperatures would drive Mid-Atlantic sea levels [up] 1-1/2 to 5 feet by 2100,” which could supposedly “permanently flood 11 percent of the state’s land area, as many as 20,000 dwellings and 32 percent of the state’s manufactured homes, while also increasing incidents of extreme storm flooding over a much wider area sooner.”  Susan Love of DNREC touted planning so as to minimize the cost of retreating.  Similar meetings are planned in New Castle County (2/19) and Kent County (2/25).  Among the “61 options” under consideration is a requirement for sellers of coastal properties to disclose their location in “areas likely to be flooded in the future” based on the DNREC sea level rise scenarios extending until 2100.  Some property owners were less than thrilled with this idea, apparently, and there was also some push back on the alleged link between recent coastal storms and the allegedly inevitable global warming.  As Lynn Andrews of Fenwick Island put it: “The president thinks he can change the weather,” but “he can’t.” 

2/14/13, A13, Reauthorize tool to protect abused women, Senator Chris Coons – This column calls on the US House of Representatives to promptly pass a Senate-approved bill to extend the Violence Against Women Act.”  The proposal, which died without House action in the last session of Congress, has been come up repeatedly in the News Journal, see, e.g., 1/6/13 editorial.  According to Coons, “Delawareans are tired of waiting for this long overdue reauthorization.” Supposedly, the renewal legislation made “tough cuts to save money” even while “protecting the programs that have been the most successful.”  Also, although the column glosses over this point, the law was expanded to protect “gay and lesbian Americans” from violence and to allow illegal immigrants to report violent crimes without exposure to being deported.  Carol Post of the Delaware Coalition Against Domestic Violence and Wilmington Police Chief Christine Dunning are quoted as favoring the Senate bill, which Coons describes as a “first step” towards allowing men, women and children across the US “the chance to live free from violence and fear.” See also: Elections only hope to sway House Republicans, A12, editorial – “Oddly, House Republicans have been consistently resistant to these changes, which is strange, considering the amendments go to the heart of why the GOP lost the White House in November. *** Immigrants, young people, women and members of the LGBT communities overwhelmingly supported Democrats. *** Hopefully the coming 2014 mid-term Congressional elections will . . . cause [non-smart Republicans] to consider what’s at stake for their party in once again voting down this valuable safety net for half of the country’s population.” If one believes in the 10th Amendment, it’s hard to see why the federal government should necessarily play a permanent and ever-growing role in what amounts to local law enforcement.  But it is undeniable that standing on principle in such matters involves political hazards, which politicians must necessarily weigh in the balance.

2/14/13, B1/B2, School leaders plead case; Changes touted at Pencader Charter, Nichole Dobo – Readers are reminded once again that the former school management made some mistakes. Notably,  “ . . .the husband of the school leaders was caught on tape using the word ‘bitch’ while admonishing a female student . . . school leader had a doctoral degree [not required for her position] from a . . . degree mill, and the state Pension Office ruled that the leader had improperly allowed double-dipping by three retired teachers, including the school leader’s husband.” But the school leader was let go last September, there has been a complete turnover of the school board, and now the new management is asking for a chance to turn the school around.  Apparently, the new management was well supported at the public hearing yesterday, which is “the final step” before the state Board of Education takes up a proposal to terminate the school in the middle of the school year.  As we have said before, the handling of this matter by the Board of Education has been abysmal. 

2/13/13, local coverage of president’s State of the Union address: (A) President tells GOP to back him; bolstering middle class among goals, Julie Pace (AP) – Basically a summary of the speech, but the headline is revealing, i.e., “tells” versus “asks” or “urges” the GOP to support his proposals. (B) Climate change now a priority, A1/A2, Jeff Montgomery – The president’s remarks – touting opportunities of solar, wind and greater energy efficiency – “came little more than three months after Superstorm Sandy threatened the entire state of Delaware before savaging the Jersey Shore and New York, leading to a $60 billion relief package likely to cover only a small share of total losses.” Actually, the $60B package was loaded with “pork” in addition to covering legitimate storm-related damage.  The reporter goes on to relate the speech to the proposals of Delaware’s Sea Level Advisory Committee and cite several comments on the issue.  Rich Collins of the Positive Growth Alliance reportedly opposes the White House approach and said recent cuts in emissions have gone unrecognized.  Eileen Claussen of the national Center for Climate and Energy Solutions hailed the president’s remarks and urged that they be followed by a cap-and-trade scheme or carbon tax to reduce “heat-trapping carbon dioxide emissions.”  Lieba Kaplan, apparently a Bowers Beach property owner, said, “I’m concerned that we don’t just make the oil companies and gas companies richer.  We need to shift to cleaner energy [and] take advantage of the wind that’s blowing through Bowers Beach all the time.” (C) President offered a laundry list instead of focus, A14 – The president called for the completion of unfinished tasks, says this editorial, which is a “wonderful idea.”  However, he “diluted the message” by “adding more challenges, more programs and, ultimately, more tasks that will remain unfinished."  Thus, it sounds nice to raise the minimum wage to $10, but let’s remember that “the unemployment rate is stuck near the 8 percent mark and showing few signs of improvement.”  And although “many of these ideas are good and would be worthwhile,” the “list is too long” and “it was hard to pick his number one goal.”  The most effective area of the speech – which “went beyond the laundry list” – was the segment about combating gun violence and how “each of these victims deserves a vote from Congress.”  (D) Fact check: Overreaching in Obama’s State of the Union, A2, Calvin Woodward (AP) – Four inflated claims are cited: (1) “Our businesses have created over 6 million new jobs” (that’s from Feb. 2010 – much lower since Jan. 2009); (2) “we have doubled distance our cars will go on a gallon of gas” (the goal for 2025, not a recent accomplishment); (3) “real [immigration] reform means establishing a responsible pathway to earned citizenship [that includes] going to the back of the line behind the folks trying to come here legally” (“provisional immigrants” could stay in the US without risk of deportation, which beats the options for prospective immigrants still outside the country); (4) “If Congress won’t act soon to protect future generations, I will direct my Cabinet to come up with executive actions we can take to reduce pollution, prepare our communities for the consequences of climate change and speed the transition to more sustainable source of energy” (It’s debatable how much more the administration could do along these lines than it is already doing.) This list omits a lot, including recurring claims that various multi-billion dollar spending programs would not add “a dime” to the deficit.  Why wouldn’t they?


2/12/13, A1/A8 et seq, AMBUSHED: Custody dispute turns deadly as shooter kills two women including former daughter-in-law before being fatally shot, Cris Barrish et al – Another story of gun violence, this time in the atrium of the New Castle County Courthouse just before the checkpoint.  One lesson is that no security measures are fool proof: Building security requires delicate balance of access, vigilance, A8/A9, William McMichael.  Checkpoints improve the odds, however, as well as limiting potential for mass shootings in a contained space. Another is that the potential for violence is often evident for years before a fatal attack takes place: Shooter had longstanding grievance with victim; Matusiewicz family involved in running child custody dispute, A9, Melissa Nann Burke, et al.  No surprise, Vice President Joe Biden was quick to cite the attack as supporting the administration’s gun control proposals: Wilmington shooting marks Biden’s talks, A5, Jonathan Starkey.  Speaking at a previously scheduled event in Philadelphia, he said, among other things, that “if we can save the life of one single person, one child, without any impact on an individual’s constitutional right [2nd Amendment], then why in God’s name should we not do that?”  As for concerns that the current proposals are only the first step toward a broader set of restrictions on firearms, “that’s a bunch of malarkey.”  On the editorial page (A12), Mom and public victimized in killing – “ . . . another tragedy where guns and unresolved dysfunction and abuse among family members has again spilled into the public square. *** We do know from the evidence of research and science that a broader appreciation for family and mental health therapy in our society is warranted.” The administration’s proposals probably would not have avoided Sandy Hook school massacre, the current shooting, or other outbreaks of violence that have been reported. And even complete disarming of the general population would not keep criminals from obtaining weapons and acting on their impulses.  Nor can intensive (and costly) psychiatric care provide real protection against violence – only identification and commitment can do that. 


2/12/13, A13, Healthcare reform signals changes for Delawareans, Christopher Smith (asst. professor, Widener Law School) – The general thrust of this column is that GovCare will work better than critics are predicting.  Three positive changes in 2013 are cited for “225,000 low-income First State residents”: (A) The new law will mandate increased reimbursement for primary care doctors, who “have been sorely underpaid by Medicaid.” This should increase access to care and also inflate state outlays (which are already busting the budget). (B) Extension of federal CHIP funding will ensure “continued coverage” in cases where families “earn too much money to qualify for Medicaid, but . . . still cannot afford health[care] insurance for their children.”  (C) Federal government “is offering additional federal funding to states that provide free or low-cost preventive care services to Medicaid,” and since Delaware was already funding such services it stands to benefit (but see A). Also, the “doughnut hole” on Part D Medicare coverage for prescription drugs will be gradually phased out.  But “those impacted” by “some tax-related changes in store” may “view them unfavorably,” e.g., (1) floor for deduction of medical expenses will be raised from 7.5% to 10% of adjusted gross income, (2) Flexible Spending Accounts will be capped at $7,500 per year, (3) “healthcare-related taxes on the wealthy are increasing,” and (4) a 2.3% tax will be imposed on the sale of medical devices, e.g., heart valves and hip replacements.  Well, gee, you can’t please everyone.

2/10/13, A1/A8-9, Crude impact: Refinery expansion brings more trains, concerns about pollution and local traffic, Jeff Montgomery & Melissa Nann Burke – A rising volume of crude oil from Canada will be coming by rail to the PBF refinery at Delaware City vs. by tanker from Saudi Arabia, etc.   “Thick, high-sulfur, heavy crude from western Canada’s vast and controversial oil sand field could make up more than half of the new deliveries.”  Ironically, one reason for this developing traffic is the environmentalist-sparked holdup on building the Keystone Pipeline, which is creating a glut of Canadian-produced oil.  In addition to the natural questions about rail safety, holdups at road crossings in the area, and so forth, local environmentalists are bitterly complaining.  For example: (1) “This is now connected to us in Delaware, these very dangerous, very dirty extraction processes that are happening in the Bakken formation and in Alberta,” said Amy Roe, conservation chair for the Sierra Club Delaware Chapter.  (2) “This is not your grandfather’s fossil fuel,” said Allen Weinmann, associate director with the National Wildlife Federation.  “This is taking the climate crisis in a whole new direction.”  One more example of the desire of some people to have their cake (vibrant economy, jobs) and eat it too (no environmental effects they view as undesirable).  Sorry, in real life it’s often necessary to accept some tradeoffs. 

2/10/13, E1/E4, Too-big-to-fail too hard to solve; Growing sense that Dodd-Frank didn’t end future bailout risk, Craig Torres & Cheyenne Hopkins (Bloomberg News) – Big surprise, it is now being said that the GovFinance bill did not eliminate the risk of big banks getting into financial trouble.  Accordingly, rumors are buzzing about the possibility (or risk, depending on one’s viewpoint) of further legislation to break up the banks, limit their size, raise their capital requirements some more, or what not.  One concrete factor that has fueled the buzz is JPMorgan Chase’s trading loss of more than $6.2B from a bet on credit derivatives.  As Senator Sherrod Brown (D-OH) put it, that loss is among events that “have proven ‘too big to fail’ banks are also too big to manage and too big to regulate.  The question is no longer about whether these megabanks should be restructured, but how we should do it.” We’re somewhat torn on this issue.  It’s undeniable that behemoth institutions are not necessarily efficient or effective.  Note the irony, however, that the fiercest critics of big banks never seem to worry about the ever-growing size and scope of the federal government – which is similarly too big and complex to govern and is potentially far more dangerous.   

2/8/13, A10/11, Bloom faces penalties, Aaron NathansCould the Bloom be off the rose?  Who knows, but the News Journal did run this story based on a tip from civic activist John Nichols about how Bloom Energy brought in 14 workers from Mexico on a temporary basis to help refurbish power generators at its Sunnyvale, CA facility and paid them $2.66 an hour in Mexican pesos versus the US minimum wage.  Bloom’s explanation: it was an isolated incident that was “inconsistent with our culture and values.”  The wage shortfall and penalties have been paid, end of story.  Asked to comment, several Delaware figures (e.g., the governor’s office) expressed confidence that Bloom will comply with applicable labor laws in its operations here.

2/8/13, A12, Committee appointment worthy of Del. praise – Kudos to Senator Chris Coons, says this editorial, for getting himself appointed “to lead the Senate Judiciary subcommittee that oversees the federal bankruptcy system.”  In this capacity, he should be able to oppose rule changes that might undermine Delaware’s bankruptcy court’s status as a forum for proceedings involving companies that are incorporated here but have their principal place of business elsewhere.  Also, it is said, “expect the Yale Law School graduate to tackle the problem of judicial vacancies.” Go, First State!

2/8/13, A13, Rally Congress to lift the bar on minimum wage, Matt Miller (Center for American Progress) – The federal minimum wage “has been stuck at $7.25 since 2009,” and is said to compare to a minimum wage in 1968 that was “worth $10.47 in today’s dollars.”  Meanwhile, “Eric Cantor feebly tries to rebrand the GOP” and the president is maneuvering “to sidestep the sequester he signed into law in 2011.”  By the way, unemployment in Australia is only 5.4% and their minimum wage now tops $15.  Ralph Nader has the right idea.  At 78 years old, the liberal icon led a fight last year to lift the minimum wage to $10 – albeit without success.  Others are said to favor even bigger increases, plus indexing the increased minimum wage for inflation (indexation is favored by Carl Camden of Kelly Services, and was supposedly supported – if so we missed it - by Mitt Romney during his presidential campaign).   The remaining question will be “how best to share the cost of achieving this decent minimum among employers, taxpayers (via subsidies for low-wage work) and consumers (via slightly higher prices).  OK, there can be exemptions for young trainees, restaurant workers, etc., but let’s hope the president proposes a big minimum wage increase in his State of the Union Address next week.  Bad idea!  Wages should be set by supply and demand; government intervention in the process invariably promotes higher unemployment. 

2/8/13, B1/B2, Carper presses for Corps commitment on dredging, Nicole Gaudiano – Senator Tom Carper “pressed Thursday for continued funding of the Delaware River dredging project, saying he’s concerned the project could stall amid budget cutbacks.” There apparently is concern that a portion of the channel deepening may not get done, which would defeat the purpose of the dredging that has already been done up river.  Environmental groups oppose the dredging, which they have been trying to block for a decade, but now we read that “port and labor groups say a deeper channel would protect local ports, businesses and jobs as global shippers increasingly turn to deeper-bottomed vessels.”  Heretofore, the News Journal had little good to say about the dredging proposal.  See, e.g., this editorial (11/20/10).

2/7/13, A11, Rein in pensions before state faces fiscal problems, Ellen Barrosse (CEO of Synchrogenix, and Republican National Committeewoman for Delaware) – Are Delaware’s pension plans 81% funded, with $1B in underfunding to be covered, or are the true numbers 40% funded/ $11 billion under water?  The answer depends on the projected rate of return, which is currently 7.5% but in the opinion of some should be a market-based “risk-free” rate of 2%.  See a just-released Mercatus Center study by Eileen Norcross of George Mason University,  Nor is Delaware’s problem unique, as “virtually all public pension sponsors in the U.S. are understating their pension problems by using the same faulty methodology.”  So what should be done?  The writer’s conclusion is that Delaware needs “pension reform – [this] is the biggest fiscal problem Delaware faces and will create pressure for higher taxes if not dealt with soon.”  We believe the conclusion is overstated; Delaware should be able to earn returns considerably higher than 2% on its pension assets (but perhaps not as high as 7.5%). Also, the implication of private sector responsibility vs. public sector irresponsibility is dubious; many corporate pension funds are not only significantly underfunded but also using what would appear to be unrealistically high return rates in their calculations.  The problem has been exacerbated by Federal Reserve policies to artificially hold down “risk free” interest rates and thereby push investors to buy riskier securities (reducing yields for these securities as well).  See Federal Reserve launches another monetary policy experiment, (9/17/12).  We do agree, however, that shifting from defined benefit plans to defined contribution plans on a going forward basis – “the best way to avoid uncontrollable pension liabilities is not to accrue them in the first place” – might be a good idea. 

2/7/13, A1/A2, Saturday delivery soon to be memory; Postal Service says move necessary to cut costs, Mike Chalmers – The USPS has announced a plan “to save $2 billion a year and prevent collapse by eliminating most mail delivery on Saturday,” and some folks think it’s about time.  If the USPS “suffered a $15.9 billion loss in the past budget year,” as reported, this plan is nothing more than a step in the right direction. But there are naysayers, such as single mother Danielle Bailey who “sometimes gets something she really needs [on Saturday]: a check to buy groceries and asthma medicine for her child.”  And a representative of the letter carriers union called the plan “misguided and counterproductive.”  As for congressional reaction, Senator Tom Carper threaded the needle by saying he was “disappointed” but “it’s hard to condemn the postmaster general for moving aggressively to do what he believes he can and must do to keep the lights on.”  See also Congress will punt on Saturday mail delivery (A10) for a prediction that Congress will “find some way of putting off a decision” and “the Postal Service will lose more money.”  We think the News Journal should take a position on this matter, not simply predict inaction because Congress is clueless.  And let’s not forget that USPS losses will ultimately have to be paid for by we the taxpayers.

2/6/13, Obama stresses need for stopgap budget deal, Jim Kuhnhenn & Andrew Taylor – The president suggested at a White House briefing that Congress should replace the looming spending sequester ($85B in 2013) with what are termed “targeted short-term spending cuts and higher taxes.”  As a backdrop for his appeal, the Congressional Budget Office has just forecast “a yearly budget under $1 trillion [$854B] for the first time in his presidency.” This story neglects to point out that the president’s proposed budget for fiscal year 2014, which was due by law on 2/4/13, may not be delivered to Congress until March. Under these circumstances, we would not place much credence in the CBO projection.


2/6/13, A13, the missing link in charter school reform, Ronald Russo (former president of Charter School of Wilmington & former principal of St. Mark’s High School) – According to the writer, “the purpose of Delaware’s charter schools was to improve public education for all Delaware and not to create a parallel public school system.”  Thus, the charter schools, freed from some of the bureaucratic constraints of the public school system could “explore alternative paths to educational success” and serve as “a lever for change” in the public schools.  Russo recalls working (about 30 years ago) with the Delaware Association of Independent Schools (at the time private and Catholic schools), which functioned as “a roundtable of equals for the benefit of all.”  Today, a similar sharing program could result in better public schools and correspondingly lower demand for charter schools.  For such a vision to be realized, the charter schools would have to be accepted as equal partners vs. grudgingly tolerated competitors.  As a case in point, consider the shameful mishandling of problems at the Pencader Charter School by state officials over the past few months (amply evidenced by the voluminous News Journal coverage of problems at Pencader).

2/6/13, A10/A11, Biden mirrors US claim of S&P fraud; Delaware files state suit over securities ratings, Eric Ruth – We mentioned the federal suit against S&P in an entry yesterday as an example of how the cumulative weight of claims against private sector institutions based on the 2007-2008 financial credit seems to be getting out of hand.  The feds are reportedly seeking over $5B in damages against the bond-rating agency, which would presumably put it out of business.  And now we find out that Delaware AG Beau Biden is supporting the suit at the state level.  Biden is quoted that the barrage of lawsuits from the states and the federal government represents a “coordinated law enforcement action.” Is it law enforcement or political pay back?  While holding no brief for S&P, we would suggest that bond buyers should not have invested based on the firm’s ratings without doing any research as to what kind of securities they were buying.  Some observers (e.g., the Wall Street Journal, see 2/6/13 editorial) say the real reason S&P is being sued at this time, while other ratings agencies are not, is that only S&P had the temerity to downgrade US treasury securities in 2011.

2/5/13, B1/B9, Growing up with guns; Del. lawmakers urge common-sense bans, Nicole Gaudiano – Sen. Tom Carper owns a 16-gauge shotgun.  Rep. John Carney owns a Remington 11-87 shotgun.  They are among 46 Democratic and 119 Republican members of Congress who own firearms according to a USA Today survey, and the true number is probably higher as some members (including Senator Chris Coons) declined to respond.  As a matter of “common sense,” however, Carper and Carney support banning military style assault weapons and high-capacity ammunition magazines plus background checks for all gun purchases.  Sen. Coons is also supportive of these measures, but “hasn’t signed onto a proposal to ban assault weapons.”  The guns that Rep. Carney would like to ban have military characteristics such as a pistol grip, grenade launcher and fixed magazine that can hold more than five rounds; he calls them “a danger to law enforcement [officers?], and in my view, not necessary for people to protect themselves in their homes.  It’s certainly not a hunting weapon.”  The Second Amendment is not limited to hunting weapons and opinions differ re what weapons may be necessary for self-defense.

2/5/13, A8, Gun safety technology worth exploring – “It’s clear,” says this editorial, “that our existing public policy does not adequately address the gun violence that continues to violently seize our national psyche.”  And “both sides remain entrenched in views that don’t move us an inch closer to secure public spaces, from which a classroom or busload of school children can expect not to be besieged by someone who is mentally ill with a death wish.”  There is some “really promising research” to “personalize” weapons by fingerprints or radio frequencies so only the gun owner can fire it.  But just “because the federal government is sponsoring the research, gun rights loyalists are raising privacy fears and even suggesting that the government would use [the resulting technology] to control private citizens’ use of their weapons.”  OK, let such “privacy concerns” be litigated in the courts, which “likely will have their rosters filled with appeals,” but it’s downright “cowardly” to ignore the value of options that could save lives.  Maybe some people want a gun no one else can fire, although this feature might turn out to be a bit pricey (the editorial does not mention cost).  Does anyone truly believe such technology would keep lethal weapons out of the hands of criminals, however, when hundreds of millions of weapons without it are in private hands?  And about those court cases, there is surely no need for another bonanza for lawyers in our already far too litigious society.

2/5/13, A8, Who decided US megabanks are too big to jail? Simon Johnson, MIT Sloan School of Management – According to this column, the federal government should have launched a wave of criminal lawsuits against financial institutions for their role in the 2007-2008 financial crisis.  Asst. AG Lanny Breuer, the head of the criminal division at the Justice Department, is slammed for an on-camera interview, aired recently, in which he “stated plainly that some financial institutions are too large and too complex to be held accountable before the law.”  AG Eric Holder and Treasury officials are also scathingly criticized.  We have several problems with the foregoing.  (A) There has been a non-stop wave of civil litigation on a variety of theories that have resulted in tens of billion of penalties being assessed on big financial institutions.  The most recent example, headlined by the Wall Street Journal this morning, is a planned suit against Standard & Poor’s for pre-crisis security ratings of mortgage bonds that “imploded in the financial crisis and cost investors billions.” (B) The more time goes by, the more dubious punitive measures (versus actions to prevent all-too-likely future crises) become.  If some parties dodged a legal bullet or two, so be it.  (C) Much of the blame for the financial crisis belongs to public officials, e.g., members of Congress, the Federal Reserve, and administrative agencies. But none of the public officials were held accountable –- legally or even politically – and they never will be.   Where is the writer’s sense of outrage about that?  

2/5/13, A9, State makes strides against cyberbullying, Lt. Gov. Matt Denn & Attorney General Beau Biden – There was a story and editorial on the imminent cyberbullying regulations yesterday; here’s some more on the subject.  Thanks to legislation passed last year, the Department of Education will soon begin conducting random audits of Delaware public schools “to ensure that reports of bullying are being properly reported [to state authorities?].”  This “is important for statistical purposes” and will ensure notification of parents of the children concerned.  The legislation will also allow the state to start tracking bullying incidents that stem from prejudice re “race, religion, sexual orientation and gender identification” and determine whether certain segments of the student population are being “disproportionately victimized by bullying, so the state can respond accordingly.”  Publicizing the AG Office’s Bullying Hotline number has already resulted in an increase in reports of bullying because “more people [now] know how to report it.”  Experience around the country shows that efforts to regulate cyberbullying will generate legal challenges on First Amendment grounds, but the school boards don’t want the onus of responding to such suits so the AG’s Office will step in and “defend a school district that is sued from implementing a model cyberbullying policy.”  Also, complementing the legal strategy, “many schools have taken on bullying prevention as a cause.”  The schools will educate students about bullying, and allow the students to “create a culture within their schools where tolerance is promoted and diversity is celebrated.”  OK, “school bullying has been around forever, and these efforts will not completely eliminate it.” But technological advances have led to cyberbullying, which has made this phenomenon “more pervasive and damaging than it was when we were students, and we all have a responsibility to address it.”  We doubt that promulgating laws and regulations will solve the cyberbullying problem or promote greater social harmony.  What it will do, however, is to drive up the already high cost of education and create more jobs for attorneys.  Whatever happened to common sense administrative action by parents and school officials? 

2/4/13, A10, Enforcement key to proposed cyberbullying regulations – For background, see 10/8/12 story, “Cyberbullying more than a state issue,” re the aspirations of Lt. Gov. Matt Denn & AG Beau Biden to play a trailblazer role in this area.  Their objective, from this editorial, is to capitalize on the efforts of community organizations and the Delaware Bar Foundation to “ultimate[ly] erase the tolerance for such attacks,” or in other words to identify and punish any and all “attacker[s] intent on posting intimidating and most likely fault[y] assaults on their victims.”  At a national level, “one out of three middle and high school students report being the victim of some form of bullying – 1 million of those report being victims of cyberbullying – every day, about 160,000 students do not go to school because they are afraid of being bullied.”  But we may never know “how many of Delaware[‘s] students are among these numbers,” as, “the one success of cyberbullies is their ability to silence their victims.” At this point, the State has come out with a new set of regulations that will be finalized after considering public comment.  “Then the Department of Education will issue a final cyberbullying policy and each public school and charter school will have 90 days to adopt it.”  And if any school districts or charter schools face a legal challenge after implementing the new policy, AG Biden will defend them.  We continue to think this problem is being exaggerated.  It would seem the Delaware incidence data should be determinable – unless, perchance, the national data are made up numbers. It would also seem that the attorney general’s office should have more important things to do than getting involved in legal disputes between the parents of the teenagers involved.

2/4/13, A11, Our tax system: 44,000 pages of favors and confusion, Wayne Smith (former majority leader of the DE House of Representatives – Why are there 10 times as many words in the Internal Revenue Code as in the Bible?  The extraordinary length and complexity of the IRC is due to a host of special tax provisions – including such obscure examples as the federal bicycle commuter tax credit, a $10K deduction for certain ship repairs available only to whaling captains, and a “1962 deduction promoted by orthodontists for clarinet lesson expenses for children with overbites.”  In short, the evolution of the income tax law is the result of “democracy, plain and simple, as practiced these last decades.”  Politicians who “want to do good things” interact with rent seekers, and the resulting tax proposals get enacted into law.  Now, 100 years after adoption of the 16th Amendment, it’s about time to convert the income tax into a flat tax.  Smith’s specific proposal would start by “get[ting] rid of all deductions, credits and adjustments to taxable income.”  Then tax income as follows: (1) Every income earner including “the kid mowing my lawn” should pay 5% on all income. Why?  Because they are responsible for the government and they receive benefits from it.  (2) Allow a per-person and dependent deduction of $7,500, in recognition “that children (future taxpayers) are expensive but also necessary to our continued existence. (3) Apply a flat 15% tax rate to whatever income is left after points 1 & 2.  Let any who criticize this approach defend the current system as better.  Far be it from us to support the current system.  However, other reform options such as the FairTax and SAFE’s SimpleTax proposal may also merit consideration.

2/3/13, comments on 100th anniversary of the federal income tax – The News Journal offered some interesting perspectives in the editorial section. To round out the picture, we provide a link to another view of how the income tax has developed over the last century and some reasons for deep-rooted dissatisfaction with the current system.   (A) Wish the income tax a happy 100th birthday, A17, Sheldon Pollack (UD professor, Law and Political Science).  Relates how two conservative politicians, President William Howard Taft & Senator Nelson Aldrich, miscalculated – supporting a resolution to amend the Constitution in a manner that would authorize an income tax.  The resolution was a concession to the “progressive” wing of the Republican party; it was assumed that ¾ of the states would never approve such an amendment – but after TR ran as a third party candidate in 1912 and Woodrow Wilson was elected president, the bet proved to be a bad one.  Delaware was the 36th state to approve the amendment, thereby “sealing the deal.”  And a good thing too, according to the writer, as “the progressive income tax . . . provides more than 50 percent of federal revenue . . . [and] it is difficult to imagine how the United States could function without [it].”  (B) At least we keep the tax system out of hot water, A17, John Sweeney.  “People may hate the income tax, but the [tax] system was far from perfect before it came along.”  As a case in point, President John Adams supported what was called a “window tax,” which was intended to pay for a war against France (which did not materialize).  And there was a famous episode in 1798, when a Pennsylvania housewife dumped hot water on a tax assessor while he was counting the windows in her house. The attempts to punish the woman sparked wider protests, arrests, a mob that broke people out of jail, and the army being sent it to calm things down.  John Fries, one of the leaders of the “Fries’ Rebellion,” and two neighbors were sentenced to hang for high treason, but the president eventually pardoned the protestors – losing the 1800 election to Thomas Jefferson anyway. (C) Remember, taxes pay for the benefits you get, A16, Ted Kaufman.  “There are some in Congress who have called for the repeal of the 16th Amendment” because “they do not like taxes of any kind,” but – “fortunately for the country” – “Congress voted for tax increases as part of the ‘fiscal cliff’ agreement.”  More tax revenue is clearly needed: in the late 1990s, under President Bill Clinton, tax revenues “was almost 21 percent of GDP” and “today it is less than 16 percent.” This comparison, which seems designed to blame the Bush tax cuts (some of which have now been made permanent) for most of the current fiscal gap, is misleading.  Stay tuned for a more nuanced analysis from SAFE.  More spending is needed too, especially for education to support economic growth over the long term instead of “mindless cutting of funds in the name of deficit reduction.”  As a result, look for a lower unemployment rate as the economy grows, higher tax revenues, and a balanced budget to become feasible.  What about evidence that many recent college graduations are either jobless or underemployed?  Thus, one study reported that 48 percent of 2010 graduates have jobs that don’t require a bachelor’s degree, while 38 percent have jobs that don’t require a high school degree.  Celia Bigelow column,, 2/3/13. (D) One hundred years of the income tax, John Hayward,, 2/3/13.

2/2/13, A8, Obama administration made a just resolution – This editorial lauds a new edict re provision of birth control measures as part of qualifying healthcare insurance coverage as conceding “the dominance of the First Amendment’s guarantee of religious expression over a public policy mandate.”  Accordingly, it is suggested, churches and religious organizations that objected to providing birth control should celebrate the announcement as a moral victory.  Lawsuits to block the birth control (contraception services and “access to abortion services”) should be happily dropped, and conservatives should stop trying to defund Planned Parenthood just because this organization provides abortion services with non-taxpayer funds (“three percent of all its health[care] services”).  The new edict says insurance companies will absorb the cost of providing birth control measures (but in one way or another, said cost will inevitably be passed on to taxpayers or customers). We don’t understand how this differs from the “compromise” edict that was issued a year ago, and if there is a difference it is purely cosmetic.

2/2/13, A8, Immigration solution is simple: build a fence, Charles Krauthammer – The bipartisan approach for immigration reform is basically a charade.  While it says the path to citizenship would become permanent when “some commission deems the border under control,” the 11 million or so illegal immigrants who are presently in this country would be granted “probationary” legal status on day one, giving them the right to live and work here openly, and once that happened it is politically inconceivable that such a grant would be rescinded because the borders had not been secured after all.  Accordingly, says Krauthammer, put the horse before the cart – require the fence to be built across the entire US/Mexican border first!  Makes sense; this country cannot afford another round of amnesty followed by a fresh buildup of illegal immigrants – as happened in 1986.

2/2/13, A9, The secret agreement to cut the deficit, Michael Kinsley (Bloomberg View) – The writer claims fiscal spendthrifts and fiscal hawks are not that far apart, in that they share the belief that it’s essential to get the economy back on track by massive stimulus before starting to cut the deficit.  Kinsley supports his conclusion by contrasting the views of Paul Krugman (who never saw a deficit he thought was too big) and Pete Peterson (who is focused like a laser on reining in debt, not necessarily the deficit, but “grudgingly acknowledges the need for stimulus”). However, Kinsley does concede that it’s easier to talk about how the fiscal gap will be closed when it is no longer “needed” than it may prove to take action when the time comes.  We disagree with the premise that fiscal stimulus will be beneficial, and what’s more do not consider Mr. Peterson as a representative spokesman for fiscal conservatives.

2/1/13, A9, Economy competes with Obama agenda, Jim Kuhnhenn (AP) –Just “as President Barack Obama is pushing new initiatives on gun control and immigration, the sluggish economy [Dept. of Commerce announcement of negative GDP growth in the 4th quarter of 2012; continuing high jobless rate] is pushing back.”  Political power “resides in the moment,” according to the reporter, “and any immediate economic setback – or the perception of one – could weaken Obama’s clout or at least distract him.”  According to this article, presumably based on public opinion polls, “the economy and the nation’s debt still rank higher than immigration and guns as issues in the minds of the public.”  What a bummer, that the president might have to focus on the country’s top problems vs. his politically motivated agenda.   

2/1/13, A12, UD hosting screening of debt crisis film, Eric Ruth – “Overdraft” is a one-hour film re the federal deficit and its “implications for the American opportunity,” which was produced by the Travelers Companies in collaboration with public television.  Screening of the film at UD on Feb. 19 (5:30 PM, Trabant Center) will be followed by a panel discussion.  No charge, but registration is required (go to or e-mail  Here’s a 2-minute trailer, with sound bites by a range of political figurers and experts, from Mitch Daniels to Bill Clinton & Cory Booker. ***

  And here’s a video of a showing of the film (runs 59 minutes including the intro). Overdraft reminds us of I.O.U.S.A. – consciousness raising without actionable solutions – and the film (released in 2012) is significantly out of date since an election has since taken place without either an intelligent debate of the fiscal problem or any progress towards a solution.  The one reason to attend the UD event (as the film is available on line) would be to see what kind of discussion takes place after the film.

1/29/13, A14, Climate change deniers ignore solid science, Robert Gravell, Odessa – “Several recent letters suggest that man-made global warming is at best a cruel hoax and at worst a sinister conspiracy to take away our freedoms.”  How odd that these “right-wing zealots, especially those with technical backgrounds” should “choose to ignore facts and politicize science” when “immediate action to address this issue is critical to our children’s future.”  And by way of evidence: They (A) ignore NASA and NOAA reports “stating that climate change is real and man-made,” and (B) “use cherry-picked data, debunked hypotheses, and a dated petition form 30,000 non-verified “scientists.”  And there is Richard Muller, “a world-renowned scientists and former climate [change] skeptic funded by the conservative Koch brothers to debunk climate change,” who decided that it’s for real and “humans are almost entirely the cause.”  The citation to Muller appears basically sound, but the assertion about the motivation of the Koch brothers is not necessarily accurate and some of Muller’s views seem inconsistent with claims about the increasing incidence of extreme weather events and so forth. Let the scientific debate continue, but never mind the claim that climate realists are deluded fanatics while people on the other side of the argument are totally objective – it simply does not wash.

1/29/13, A8, Tax reforms bound to affect senior citizens – The thrust of this editorial is that the states (including Delaware) should exempt today’s senior citizens from cutbacks of property or retirement income tax exemptions for the elderly.  While it’s true that poverty rates for seniors are “lower than rates for either children or working-age adults,” the elderly can’t very well go back to work if the tax rules are changed to take more of their income (and/or if inflation erodes their savings and fixed dollar pensions).  However, it seems to be implicitly accepted that taxes on future seniors must go up – which is probably true unless governments get serious about cutting spending and restructuring entitlement benefits.      

1/28/13, A10, All types of people eligible for EITC – According to this editorial, the Earned Income Tax Credit is not simply a tax preference that people can lawfully take advantage of, it is a good thing that everyone who qualifies should be urged to claim.  And here’s a shocker: More than 20% of Delawareans “don’t know that families earning less than $45,060 (with three or more children) a year are eligible.”  It’s not just “the elderly and severely low-income citizens [who] are eligible,” and last year the EITC funneled “more than $24 million” [understated? 69K qualifying Delawareans x average of $2,100 back on their federal taxes would equal $145M] of federal taxpayer dollars into Delaware.  Yahoo, free money! Yes, “there are critics” who say “the EITC punishes the 60 million married couples when both work, which ups their income eligibility [more accurately, it gives couples a financial incentive not to get married, thereby undermining the family unit in our society], but never mind as “the EITC also increases employment and is free of the waste normally associated with entitlement programs.” Plus which it “guarantees [here’s an argument we haven’t seen before!]  the all-important FICA and Social Security taxes get collected.” Advocates cited: Rev. Clifford Johnson of Wilmington’s Shiloh Baptist Church has organized Nehemiah Gateway Community Development Corporation, from which “more than 10,100 filers got help” in preparing their tax returns (for free).  According to Johnson, the EITC “[lifts] more children out of poverty . . . than any other social program or category of program.”  Rep. John Carney, who participated in the “testy fiscal cliff negotiations” that extended EITC enhancements of recent years: “It makes the difference between getting by and getting ahead.” Actually, welfare schemes like the EITC tend to trap the recipients in dependency and poverty.  Under SAFE’s SimpleTax proposal, almost all of the exemptions, deductions and credits in the current tax system would be eliminated – including the EITC.

1/27/13, A1/A6, Lighting up, chowing down costly “sins,” Mike Stobbe (AP) – “Faced with the high cost of caring for smokers [$96B per year] and overeaters [$147B per year], experts say, society must grapple with a blunt question.  Instead of trying to penalize them, and change their ways, why not just let those health sinners die?”  And look at those ingrates, complaining about Mayor Bloomberg’s ban on “big gulp” sodas and “the vicious fight last year in California over a ballot proposal to add a $1-per-pack cigarette tax, which was ultimately defeated.”  As it is, smokers are estimated to be checking out 10 years earlier than the average while the comparable figure for the obese has been variously estimated as from 5 to 12 years.  And perhaps these people save society money by not living longer and developing expensive chronic conditions.  So “why not just get off their backs and let them go on with their (probably shortened) lives?”  Daniel Callahan of the Hastings Center (a bioethics think tank) argues that the people in question are harming others as well as themselves, e.g., nonsmokers must endure second hand smoke and overeaters saddle others with their big medical bills instead of staying healthy (what about those chronic conditions that healthy people develop later in life?).  So, at a minimum, the “health sinners” should “pay the financial price for their choices.”  GovCare will allow “health[care] insurers to charge smokers buying individual premiums up to 50 percent higher premiums” than nonsmokers.  There is no similar provision for overeaters – yet – because the evidence of the health risks is not clear-cut for people who are moderately overweight vs. obese.  But Callahan advocates another tack, namely public health campaigns designed to shame and stigmatize overeaters as smokers have been targeted in the past.  “We need to get obese people to change their behavior.  If they are angry or hurt by it, so be it.”  There is something abhorrent about this “big brother knows best” mindset.  Maybe concerns about Agenda 21 are not so far-fetched after all.  

1/27/13, coverage of proposed reactions to Sandy Hook massacre continues to focus almost exclusively on “big government” solutions(A) Thousands participate in march for gun control laws, A19, Brett Zongler (AP) – The rally, which included about 100 residents from Newtown, CT plus bus-loads of people from big cities, “stretched for at least two blocks along Constitution Avenue.”  Participants were addressed by Education Secretary Arne Duncan, who reportedly said, “it’s not about taking away Second Amendment gun rights, but about gun safety and saving lives.”  We don’t recall this much coverage of the far larger tea party, etc. marches on Washington in 2009 & 2010. (B) Core group of Democrats might block weapons measures; Senate hearings begin Wednesday, A19, Erica Werner (AP) – The gist of this story is the tension between traditional support for gun rights in rural states and (quoting Mark Glaze, director of Mayors Against Illegal Guns) “an equally strong desire to feel their kids are safe.”  Therefore, some Democratic senators are having “hard but good conversations with people back home to identify the middle-ground solutions that respect the Second Amendment but make it harder for dangerous people to get their hands on guns.” Ergo, an “assault weapons” ban may not be enacted despite the president’s strong support.  On this issue, we think gun control advocates are holding a strong hand – and the purpose of this kind of story is probably to make things uncomfortable for legislators who might try to get in the way.  NRA’s proposals to seek common sense measures to improve school security seem to be falling by the wayside – too bad.  (C) After mass shootings, states rethink mental health cuts, A3 – “Dozens of states have slashed spending on mental healthcare over the past four years,” according to the National Alliance on Mental Illness, but “that trend may be headed for a U-turn in 2013.”  Declining revenues and a desire to be fiscally responsible or not, it’s argued that robust mental healthcare programs are crucial to deter more mass shootings by crazed and/or attention-seeking individuals.  It might be more to the point to focus on changing laws so problematic individuals can be legally committed vs. providing more extensive mental healthcare services.

1/27/13, A23, Obama agenda will help conservatives flourish, George Will – According to Will, the president is starting out in his second term with the lowest approval rating (50% per Gallup) of any re-elected president since World War II.  And the policies indicated in his second inaugural address won’t wear very well, e.g., combating the threat of climate change, resisting any changes to GovCare (which as it stands will hinder job creation, e.g., giving employers an incentive to cut work hours to 30 hours per week or less), and blocking serious efforts to shrink the deficit by cutting spending.  Accordingly, conservatives should be able to make a comeback.  We’re not convinced conservatives will necessarily benefit from the president’s left-leaning stance, and even if they do there may be a lot of damage to the country before the political pendulum swings back in the other direction.

1/26/13, A23, Disappearance of jobs is destroying middle class, Ted Kaufman –The writer threads the needle between two seemingly inconsistent conclusions: (1) The past four years have “not been a bad recovery” from the “Great Recession” in that (a) real GDP per capital is up 3.6%, which is said to be “in line with GDP growth after most of the recessions we have experienced since the end of World War II,” (b) corporate profits are at an all-time high, and (c) “the stock market is 75 percent higher than it was when President Obama was inaugurated.”  These statistics attribute all of the 2007-09 recession to the previous administration, i.e., begin from about the bottom of the trough.  Also, the indicated 3.6% annual growth rate for GDP (Bureau of Economic Analysis data) since mid-2009 appears to be based on nominal vs. real GDP data (annual growth rate based on GDP data in 2005 dollars is about 2.1%). (2) Millions of “middle class” jobs are not coming back (see previous 1/23/13 story in same vein), and since businesses will only hire employees if it is profitable for them to do so – and otherwise use their profit-generated cash to buy back stock, pay dividends and “increase executive pay and benefits” - the government must intervene to expand education and job training programs so this country will be able to compete against other countries in the global economy. “Admitting the reality of jobless recoveries is the crucial first step in finding new ways to create jobs.” Cash paid out by companies via dividends and stock buybacks is not wasted; it can be reinvested in other companies with more productive uses for capital. We reject the notion that governments should play a lead role in creating jobs – this is not something governments are good at.  Education is tremendously important, but this function can better be managed at the state and local levels than the federal level.

1/26/13, NJ misses hot story that doesn’t fit its political vision – It was like “the curious incident” in a Sherlock Holmes story (Silver Blaze), a dog that didn’t bark.  “Court throws out recess picks” was the top story in today’s Wall Street Journal, but the news that four recess appointments by the president had been found unconstitutional by a federal appeals court was not so much as mentioned by our local newspaper.  Maybe the News Journal will cover the story tomorrow, probably focusing on a White House demand that Congress fix the problems that the president’s arrogant action has created.  For background, see “About those recess appointments,” (1/9/12).

1/26/13, A1/A2, Varying gun laws hinder control; lack of one standard creates maze of rules, Eileen Sullivan (AP) – The thrust of this story is that leaving gun controls to state and local laws inhibits the enforcement of strict gun controls by jurisdictions that want them.  Therefore, supposedly, “somewhere in the US, there is a legal avenue to get” almost any weapon one might name including “military-style assault weapons, gangster-style Tommy guns, World War II-era bazookas, and even sawed-off shotguns.”  How irresponsible of the NRA to advocate enforcing existing laws instead of passing new ones.  Needed: federal laws setting minimum standards that “raise the bar for gun control in states with weak laws.”  There is a big picture (on A2) of the president (looking bored, corners of his mouth drawn down) and vice president.  “President Barack Obama listens on Jan. 16 as Vice President Joe Biden speaks in the White House about proposals to reduce gun violence.” If federal gun laws are truly appropriate - we are not convinced of this – why not make them preemptive instead of allowing some states to be even stricter?  That would do away with all the confusion, but might put some lawyers out of work.

1/24/13, B3, Joint committee meeting discusses school safety, Jonathan Starkey – A joint hearing of the DE House & Senate Education Committees in reaction to the Sandy Hook massacre in CT included participation by Lt. Gov. Matt Denn & Homeland Security Secretary Lew Schiliro.  The hearing was apparently mainly for show, i.e., “produced little discussion on new school safety proposals.”  And Schiliro expressed his belief that the security measures at the Sandy Hook school were adequate.  “They had a good plan.  They had good security in place.”  Ignored at the hearing was a resolution sponsored by Sen. Dave Lawson to study the construction of emergency exits (aka panic exits) in ground-floor classrooms.  Delaware State Education Association President Frederica Jenner said afterwards that this idea is “impractical;” she expressed concern that teachers and students could be threatened with violence after they exited the building.  In addition to proposing new gun controls, the Markell Administration plans to push for funding of 27 new behavioral health consultants (a ten-fold increase) in state middle schools.  “Finding kids with mental health needs and getting them help,” said Denn, “is of paramount importance to us.” 

1/23/13, A1/A2, Job loss killing middle class; Technology shapes the global economy, Bernard Condon & Paul Wiseman (AP) – Five years after the start of the Great Recession, says this story, millions of “middle-class jobs” have disappeared.  It’s not just in the US, either, but globally – and the jobs won’t be coming back.  What’s more, millions of additional jobs will vanish according to “experts who study the labor market.”  One of them is Andrew McAfee of the Center for Digital Business at MIT, a co-author of “Race against the machine.”  Think smart phones and tablets, cloud computing, smarter, nimbler robots – and coming soon driverless cars.  “Whole employment categories, from secretaries to travel agents, are starting to disappear.”  Manufacturing came first, but now it’s services.  Even startups don’t need as many employees as they once did.  So an economic recovery will not necessarily put people back to work, and “some economists say millions of middle-class workers must be retrained to do other jobs if they hope to get work again.”  Eventually, says Martin Ford, who runs a software company and wrote “The lights in the tunnel,” software will even threaten the livelihoods of doctors, lawyers and other highly skilled professionals.  History shows that technology advances eventually create jobs elsewhere, but it’s hard to see where the new jobs will come from this time because of the pace at which IT is upending whole industries and occupations.  Look for zero meter readers within a few years, because all of the electric meters will be reading themselves.

1/22/13, the big story (in the News Journal and elsewhere) was yesterday’s inauguration in DC, here are some excerpts including local touches – (1) Above the fold on front page is a “’Journey’ Ahead” caption atop of a very large panoramic picture of the president waving to the crowd after his inaugural address.  Others in the front row: to the president’s right are his wife and older daughter; to his left are the vice president and son Delaware AG Beau Biden.  (2) Lower on the page is a picture of the vice president and his wife walking down Pennsylvania Avenue during the inaugural parade.  According to an accompanying story by Nicole Gaudiano & Christopher Doering of the News Journal Washington Bureau, “Biden appeared to be having more fun than anyone” as “he walked, jogged, gestured and pumped his fist along the inaugural parade route with his family, flashing a beaming smile as the crowd chanted ‘Joe, Joe, Joe.’”  (3) 2016 discussions likely to follow Biden, A5, Nicole Gaudiano – Some people see the vice president as a potential presidential candidate in 2016, according to this story, while others don’t. Biden himself is quoted (from a CNN interview) that “I haven’t made that decision.  And I don’t have to make that decision for a while.”  We can wait to find out, no rush!  (4) Delaware groups find joy in ceremonies; Lasting memories abound as First State visitors rise before dawn to cheer on Obama, Biden in DC, Wade Malcolm – 2/3 of a page (including pictures) based on the feelings and observations of people (primarily supporters, naturally) who traveled (many of them by bus) to DC from Delaware for the event.  They enjoyed themselves and were happy to share their favorable impressions of the president.  However, as the reporter notes in a masterpiece of understatement: “While Obama did allude to bringing the country together to face its many challenges, he didn’t go out of his way to pursue an idealistic theme of bipartisanship as he did at his first inauguration.” (5) Obama pledges to deal with issue of climate change, A6, Matthew Daly (AP) – According to this report, the president is “setting up a confrontation with congressional Republicans who have opposed legislative efforts to curb global warming.”  And encouraged by his words, environmentalists are looking for the president to block the Keystone XL oil pipeline from Canada.  Republicans and many business groups say this project would be economically beneficial, e.g., create thousands of jobs, “but environmental groups say the pipeline would transport ‘dirty oil’ from tar sands in Alberta, Canada, and produce heat-trapping gases that contribute to global warming.  They also worry about a possible spill.”  To be continued.  (6) Republicans hopeful at inauguration, A7, Jackie Kucinich (USA Today) – Various conservative Republicans are quoted as complimenting the president’s speech, e.g., Newt Gingrich, and Sen. John Thune (SD).  House Speaker John Boehner et al. “had coffee with the president and the vice president on inauguration morning – the first of several bipartisan events throughout the day.”  Mitt Romney “remained at his home in La Jolla, Calif.,” however, and Rep. Jason Chaffetz (R-UT), “one of Romney’s more vocal supporters, also chose not to attend.”  “Despite the [superficial] bipartisan comity, several Republicans were quick to mention the looming debates over raising the federal debt ceiling and $1.5 trillion [sequester is actually for $1.2 trillion, which includes imputed interest savings] in impending spending cuts over the next [10 years].” (7) Obama’s vision is eloquent, too ambitious, A10 – Conservative commentary in other quarters accused the president of offering a starkly partisan vision; although friendlier, this editorial predicts a “political clash” ahead.  The new and “tougher Obama *** would have been more persuasive if he had acknowledged government’s failures as well as its successes.  [His to-do list] is too ambitious, too scattershot, and too ripe for knocked-down fights with Republicans.  Some things are worth fighting for, but everything isn’t.”

1/22/13, B1/B9, Arctic cold grips state; subfreezing temperatures could linger, Jeff Montgomery –“The area’s balmy winter is over, with lows in the teens expected tonight and Wednesday.” And the colder weather may last awhile.  Why this change?  It’s said to be due to “a split in the frigid vortex that typically whirls above the North Pole.” Mark Paquette, a meteorologist with AccuWeather, says “studies have shown that these types of events can last *** generally a period of 10 to 14 days, but it can set up for 45 to 60 days.”  According to Paquette, a “sudden stratospheric warming” led to the disruption of the Polar Vortex.  Researchers have supposedly “tied the process to sea surface temperatures and other weather factors that might be influenced by rising global temperatures.”  Whether the weather is warm or cold, it seems climate alarmists can spin the facts to support their ideas.  The last two paragraphs of the story are the by now all-too-familiar spiel about 2012 temperatures (nationally and locally) being the highest since record-keeping began in 1895 “with eight of Delaware’s 10 hottest years coming since 1990, including the last three 2010-12.”  Carbon emissions warming the atmosphere – global average temperatures 3.5 to 6.5 degrees Fahrenheit above current averages by the end of century – increases in extended drought and extreme storms and flooding – average of sea-level increases of 3 to 6.5 feet.  To quote three eminent scientists in an 8/13/12 letter to the Wall Street Journal, “repetition of a fib does not make it true” and “it is increasingly clear that doubling CO2 is unlikely to increase global temperature more than about one degree Celsius [1.0º F].


1/21/13, A1/A2, “We have a special interest;” At least 1,000 gather in Dover as NRA president [David Keene], other officials vow to fight state, federal plans, Jonathan Starkey – The noteworthy point here is not the substance of what was said but the turnout and enthusiasm of conservatives in the state.  No other issue recently, including the election campaigns, the Bloom Energy boondoggle, or even the fatal problems of GovCare, has resonated in such a manner.  And although surrogates of the governor and the attorney general are quoted in support of the state and federal gun control proposals that are in play, one may be sure that politicians on both side of the gun control debate were paying attention.  Mr. Keene gave an unusual twist to the term “special interest” by saying everyone present (estimated 1,500 people) in the Modern Maturity Center in Dover had “a special interest in the Constitution of the United States *** the Second Amendment of that Constitution *** the freedoms that have been bequeathed to us by the founders and those who have defended them over 200 years.”  Would that this level of engagement could be mustered in other areas, which in the overall scheme of things are probably more crucial for the nation’s future. 

1/18/13, A1/A2, DE governor Jack Markell’s “state of the state” address – Temporary tax increases will be extended - wants higher starting pay for teachers and “will seek to pay teachers more if they teach in high-needs schools or critical subjects such a science, technology and math” - “nodded to an expected initiative to legalize same-sex marriage in Delaware” – reduce (from 5 years to 2 years) the amount of time schools have to adopt safety plans under a law signed last year – more mental health professionals in middle schools – reprise of gun control proposals announced earlier – and called for a “frank conversation” about how to react to what reporter Jeff Montgomery refers to (in a separate story on A2, entitled “Climate change a top priority”) as “a changing and potentially more destructive climate.”  One more time, in case readers might have missed this news, NOAA “says the mid-Atlantic is in a hot zone where sea-level rise will increase at double the rate of other regions on the planet.  Warming forecasts predict a 3.5 to 5.5 degree Fahrenheit or more increase in global average temperatures and a projected 3-to 6.5 foot increase in average sea level by the end of the century.  Current projections suggest Delaware could lose as much as 11 per cent of its land area and as many as 20,000 homes by the end of the century as global temperatures rise, polar ice melts and oceans expand.  Higher surges from more damaging storms could compound the threat, scientists have cautioned, sending harm far inland along the state’s many tidal waterways.”  According to DNREC Secretary Colin O’Mara, “a lot of the questions are financial and involve what the proper role of state government is.”  The only reported pushback was from Rich Collins of the Positive Growth Alliance, who said the problem is not climate change, “it’s the fact that climate change is being used as an excuse for government to take over our lives.” Hang on to your wallets, folks!  And notice the lack of proposals on promoting economic growth in Delaware, which should be at the top of the list.

1/18/13, A13, Sen. Carper right to call fiscal cliff deal “insane,” DE Sen. Colin Bonini (R-18th District) – Commends Senator Carper’s “no” vote on the short-term fix that averted the fiscal cliff and the views articulated in Carper’s 1/16/13 column.  Bonini says he likes Senator Carper and members of his staff, albeit not agreeing with him on policy “all that often,” and thinks he deserves credit for voting against the “kick the can down the road” philosophy of his colleagues from both parties.  In particular, entitlements “reform” is overdue and must be “the centerpiece of any meaningful effort to get our financial house in order.”  Bonini does not “pretend to have all the answers – he foresees “political consequences for both Democrats and Republicans when tough decisions are made” – but “let’s make them and move on.”  As for the sort of changes to entitlement programs that are needed, Bonini mentions deferring “the age for qualifying” and “relatively minor changes” to Social Security eligibility that according to the Center of Budget and Policy Priorities “would place Social Security on solid financial footing for years to come.” In our opinion, the problems and needed changes go much deeper than these suggestions would indicate.  Also, it’s obvious that tax increases will be pushed to minimize benefit reductions or deferrals – and we definitely don’t support them. 

1/16/13, A1/A5, Shaping state’s future, Jonathan Starkey & Doug Denison – After being sworn in for his second term, Governor Jack Markell spoke briefly.  The specifics will wait until his State of the State message and subsequent budget message, but he made an interesting allusion to his legacy.  “Fifty years from now and 100 years from now, new generations of Delawareans . . . may not know our names, and they certainly won’t know our faces.  But they will know what we have done, whether we made Delaware better or worse in our time, because it is they who will live with the results.”  Maybe, but the judgment will not necessarily be favorable. See next entry.

1/16/13, B1/B10, Key figure in desegregation dies; Judge lauded as “best of the best,” Sean O’Sullivan – Various of his other decisions were notable, “but the decision [Judge Murray] Schwartz will be remembered for most is his 1978 order to desegregate public schools in northern New Castle County and force the busing of thousands of children miles from the school nearest their homes to achieve integration.  His ruling consolidated 11 districts into one and later redrew boundaries to create the four districts that remain today: Brandywine, Colonial, Christina and Red Clay Consolidated.”  Many disliked this ruling and fought it tooth and nail, but the News Journal supported him with a 1993 editorial (“Murray Schwartz deserves much better than he gets”) and “this week, there were few who recalled Schwartz with anything but fondness, and many in the legal community said that his controversial reputation came from making right decisions rather than popular ones.”  And while some accused Schwartz of being a “liberal activist judge,” he was “a Republican” and appointed by President Richard Nixon.  To which the News Journal adds in today’s editorial (A10), “whatever costs Judge Schwartz paid for his blind loyalty to the intent of the Constitution in public life, every Delawarean and future generations will be indebted to him for such a singular principled focus that continues to pay off in our public and private lives.”   However well meaning, the busing order did a lot of harm while it was in effect.  Jim Venema explained why in a talk to the RMLC last year.

1/16/13, A11, It’s time we show world we can still govern ourselves, Senator Tom Carper – Clearly, the fix to avert the fiscal cliff did not solve the problem.  In effect, the political elite agreed to “kick a large can down a long road not very far” and now the debt ceiling, etc. looms.  The senator pats himself on the back for voting against the fix, yet also says “I’m glad we averted a tax hike for middle-class families – thanks in part to 11th hour heroics by Vice President Joe Biden – and I believe that spending cuts should be made wisely and with intent, not randomly and without regard for common sense.”  As for the next “cliff,” he advocates doing three things: (1) raise taxes some more; (2) “reform and improve” entitlement programs “in a way that’s humane, saves money, and preserves them for future generations;” and (3) “focus like a laser on all federal programs” (of which defense is listed first among the illustrative examples) as to “how we can get better results from less money in almost all of them.” The issue is not “solutions,” it is having the “courage” to “do the job we were sent to Washington to do.” And “I refuse to believe that we can’t rise above partisan politics when so much is at stake.” This column is long on platitudes, but it lacks realistic substance.  There is no way to make everyone happy in this situation without destroying the country, sorry.  

1/15/13. Top story: Gun control – (A) Assault weapons ban among plans, A1/A2, Jonathan Starkey & Adam Taylor – Markell Administration’s gun control proposals unveiled by Gov. Markell, Lt. Gov. Matt Denn & AG Beau Biden.  Gun advocates label proposals a “knee jerk” reaction, criticize absence of any proposals to protect students in schools or improve monitoring of mentally unstable people who might commit future attacks.  However, Markell says “state schools are already working to create comprehensive school safety plans mandated under a bill he signed into law last year” and he will offer “more details on action to improve mental health services during his State of the State address on Thursday.”  Not only do Democrats control both houses of the legislature, but also “the gun control effort will have some bipartisan support.”  Ergo, whether the Markell proposals will help or not, they appear to be a done deal in Delaware.  It’s odd, however, that they should be offered without even waiting to see what the federal proposals will look like.  (B) Obama: Not concerned about politics; VP’s task force to announce recommendations, A1/A2, Julie Pace (AP) – Primary news in this report consists of the president’s comments about gun controls at his press conference yesterday, prior to receiving recommendations on the subject from the vice president including a list of “19 potential executive actions the president could enact on his own.”  Some of the examples cited sound rather “legislative” to us, e.g., establishing “tougher penalties for people who lie on background checks” and “elevating gun trafficking to a felony charge.” Next step: “the president will unveil a comprehensive roadmap for curbing gun violence within days, perhaps as early as Wednesday.” (C) Unite for responsible gun ownership laws, A8, editorial – As Senator Chris Coons “points out, [the Markell] proposals should be part of constructive debates and dialogues among the public and the legislature” whatever “the intensity of divergent views and rancor these proposals will raise.” The 2nd Amendment right to own weapons and the government’s duty to protect the public are “equally substantive causes that should not be doomed by further divisive partisanship. This is one issue where common ground is a matter of life and deaths.” (D) Letters to the editor – all but one are about gun controls, etc.  (E) Putting armed guards in school[s] is wrong answer, A9, Judith Browne Dianis, “co-director of Advancement Project.” The writer equates pledges to enhance school security with posting police officers in schools (versus, say, allowing teacher/school staff volunteers to pack heat) and claims that this “well-intentioned, but misinformed” idea has already been tried in many locations and causes more problems than it solves.  Pulls police officers away from other duties in locations where crimes occur more commonly.  Gets officers involved in “minor student misbehavior,” which tends to result in unnecessarily “handcuffing, arresting and criminalizing the very young people they are intended to protect.”  More than 70% of students arrested or referred to law enforcement are black or Hispanic, and the effects on them are traumatic.  What’s more, the learning environment for all is threatened as their schools “become less welcoming and more threatening.” So national policies should look for measures that the research shows create genuinely safer schools, “such as improved access to school-based social workers and counselors, programs that reduce conflict and comprehensive school safety plans.” Ms. Dianis has been in involved in voting rights disputes (e.g., FL 2000) and alleged overuse of arrests in educational setting.  The Advancement Project is a national group, and it’s not clear why she is identified as a “Delaware voice.”        

1/15/13, A3, GOP “irresponsible” on debt ceiling talk, Obama says, AP & Gannett reports – “President Obama on Monday slammed Republicans who are resisting an increase to the nation’s debt ceiling without further deficit reductions [to date there have been no deficit reductions to speak of except for a $600B over 10 years tax increase] and vowed he won’t negotiate on the issue.  Obama called the GOP stance ‘irresponsible and absurd’ and warned it would set off an economic crisis.”  The GOP response appears at the tail end of the story, including Senate Minority Leader Mitch McConnell’s statement that his party is looking forward to working with the president on the deficit and debt.  In a recent column, John Goodman found the president 90% responsible for current budgetary gridlock.

1/12/13, A1/A2, Top story [AGAIN]: Climate change on the coast, Jeff Montgomery & Molly Murray – There are actually two intertwined stories, with a “More Hot Days” graphic in between them on page one.  According to the caption of an ominously colored map of Delaware and nearby states, “Delaware may record 9-15 more [hot, defined as a temperature of 95 degrees Fahrenheit or higher] days each year” in 2041-2070 than it did in 1971-2000.  The logic in comparing data in these widely separated periods while ignoring current data is not explained, although story B does say that “currently, the state averages 21.2 days 90-degrees-plus days per year.” [sic]   Story A exults that Katharine Hayhoe, characterized as a “nationally recognized expert,” has been “hired” by the state Climate Change Vulnerability Assessment Steering Committee to “fill the knowledge gaps Delaware officials face in planning for rising temperatures, changes in rainfall patterns, extreme weather events and other weather trends during this century.” Ms. Hayhoe is the director of the Climate Science Center at Texas Tech University, and judging from this write-up she is a dyed-in-the-wool climate alarmist who will be helping to craft propaganda versus providing objective advice on scientific issues.  Hayhoe has reportedly recommended that state officials use only best and worst case scenarios in their reports, which “will help Delawareans decide to do something about climate change – or to ignore the warnings.”  Delaware [taxpayers?] will pay $46K for state-specific work, which is expected to be complete in draft form by March.  We can hardly wait to read more about it!  Story B reports on a “draft National Climate Assessment, which is prepared every four years” and “is expected to become final in 2014” after the consideration of public comments.  The 1,146-page document was worked on by “240 scientists and other experts from across the country,” and it declares – among other things – that “climate change, once considered an issue for a distant future, has moved firmly into the present,” with evidence to be found in hotter seasons, increased wildfires, and retreating sea ice. The sponsoring organization is the US Global Change Research Program, which “coordinates and integrates federal research on changes in the global environment and their implications for society.”  13 government departments and agencies participate in this program, which is overseen by the Executive Office of the President. It would probably be safe to assume that the people involved can expect more political support and funding if they predict dire problems than if they conclude things are going OK. There is now talk about a White House summit meeting on Global Warming, as if this was a dire problem versus a diversion from the country’s real problems. Adding insult to injury, taxpayers just got nicked $100K (peanuts by DC standards, but a lot of money to some of us) for a grant to develop a “video game featuring a black alien female superhero delivered to Earth to fight global warming.”  The game will be available in March.

1/12/13, B3, Pencader found lacking; State committee finds fault in four areas, Nichole Dobo – Having formerly recommended that Pencader’s charter be revoked (1/5/13 story), the State Charter Accountability Committee has now issued a report detailing its findings of crucial deficiencies in four areas.  The school reportedly “made some progress from a previous report when they were reported to be out of compliance in five areas” (no indication of what got better).  Coming up: a Feb. 11 public hearing, to be followed by a “final decision” by the state Board of Education on Feb. 21.  The delay in the final decision, which by state law should have come before the school choice window closed on January 9, is blamed on a process step being “delayed by Superstorm Sandy.”  As previously reported, the deficiency findings were triggered by events that predate the current Pencader school board.  President Frank McIntosh is hopeful that the school can move forward.  We continue to believe that state officials have grossly mishandled this matter.

1/11/13, A1/A2, NRA rejects Biden gun plan; Private discussions hit wall over bans, Julie Pace & Eric Werner (AP) – When the vice president gives the president his recommendations for tough new gun controls next Tuesday, they will not have the support of the NRA.  Apparently, the upshot of the NRA’s White House meeting with Biden was that the two sides are far apart.  However, the NRA is reportedly in synch with “recommendations to address mental health and violence on television, in movies and in video games.”  Look for the president’s proposals to be pushed in the State of the Union address. 

1/11/13, Buyer-beware option, A1/A5, Jeff Montgomery & Molly Murray – The Sea Level Advisory Committee is reportedly mulling a variety of ideas for stoking public concern about sea level rise including coverage in the schools and mandatory disclosures in sales of coastal properties.  However, there was some pushback.  Thus, the committee dropped a reference to school children in the proposal re education in the face of charges that they were advocated “brainwashing.” The change sounds cosmetic.  Who else does anyone think would be “educated?”  As for seller disclosure statements, Rich Collins of the Positive Growth Alliance had this to say: “To force a seller to tell somebody that something may happen when it never may happen, I think it’s crazy!”  Collins went on to label sea-level rise forecasts for Delaware of “between 1.6 to 5 foot increases by 2100” as “speculation.” Given the News Journal coverage of the purported threat of accelerating sea level rise, the need for more public awareness is not apparent to us.  And see John Greer’s letter to the editor on page A8. There was also some sparring over a proposal to tap the state’s Public Accommodations Tax – a hotel-motel fee long used to fund coastal and Delaware Bay beach replenishment – “to pay for adaptation projects statewide.”  Here State Rep. Quinn Johnson (D-Middletown) commented that the public needs to understand that “we do not now and will not have money” for the contemplated purposes.

1/11/13, A8, Fiscal deal would bring pain as well as certainty – Re reported comments of Governor Jack Markell to the National Governor’s Association, which lamented uncertainties about how federal fiscal issues will be resolved, this editorial observes that the outcome of the current debate may not do much to relieve state concerns about declining federal funds to help support state programs.  Point well taken!  But in recapping the three fiscal deadlines that are now looming, there is a material misstatement re the 60-day deferral of “the dreaded sequestration government agencies fear” that will expire on March 1.  The domestic/defense cuts involved are $85B (reduced as a result of the deferral) for 2013; they would total $1T+ over a 10-year period.

1/10/13, A5, Lew crafts budget policy with compassion, Tim Mullany (USA Today) – In the Clinton Administration, Bowles was the White House chief of staff while Jack Lew was budget director.  Now Lew, who is said to be a budget “wonk,” is about to be nominated as secretary of Treasury.  Having served as co-chair of the president’s fiscal commission, Bowles might himself have been a logical candidate for the job if the president was committed to reducing the deficit – but apparently the job was not offered to him.  The reporter asked Bowles about his impressions of Lew, who has been assailed by some Republicans, and quotes him as follows: “Jack is definitely left of center, but he’s a pragmatist, he’s a realist.  I might have moved (deficit talks) to the right, and Jack would be a counterweight to that.”  

1/10/13, A10, The political fight to end US gun violence – “Vice President Biden told reporters Wednesday that President Obama is so intent on ending gun violence in America that he will use executive action if needed.” In the ensuing discussion, this editorial suggests that such an approach might be difficult because “many millions of law-abiding citizens own firearms and take their Second Amendment rights seriously,” so that “if the president invokes his executive powers to impose his solution, he will divide the nation ever more deeply.”  We do not detect any sense of outrage about this threat, however, which was unjustifiable because the president has no business preempting Congress in the area of making legislative policy.  

1/10/13, A10, Entitlements: what’s mine is yours and theirs, Barbara Finnan (NJ Community View writer) – Basic thrust is that I paid into the Social Security trust fund so the money is not an “entitlement,” it is a right.  The writer rails about various asserted corporate tax abuses, the failure to jail anyone for the financial mess that erupted in 2008 (are they “too big to jail” vs. “too big to fail”), and “the constant drumbeat from Congress and the right wing” that Medicare and Medicaid are “rife with scammers and so they need reduction.”  She concludes that Congress – mentioning Senator Tom Carper, House Speaker John Boehner, and Rep. Eric Cantor by name - “needs to clean up the mess they’ve created, fostered and allowed.” These and other entitlement programs are not sustainable or anywhere close.  The real fault has been making promises that cannot be kept without tanking the US economy.

1/6/13, A1/A12-13, Promise of change: Grading Markell’s plan to improve Delaware’s schools, Nichole Dobo – “No matter where you stand, there’s been change in Delaware schools under Gov. Jack Markell.”  But it’s hard to tell from this lengthy story whether the changes will result in solid progress or not.  What would it take to “build a world-class school system,” as Governor Markell says he wants to do, and how likely is it that this goal will be achieved any time soon?  More centralized controls and tracking data “constantly” will not necessarily accomplish much, in our opinion, if what is needed is more autonomy for school managers and more choices for parents as to where their children will be educated.  Also missing from the story is discussion of the cost of Delaware schools and the efforts being made, if any, to utilize new teaching technology (giving out I-pads is mentioned, but what are the students doing with them?).  Jim Hosley of CRI is quoted to the effect that “parents want quality schools now and he’s not sure the millions that Markell has spent will produce what the governor has promised.” 

1/6/13, editorial section promotes counterproductive policies(A) Time for America to renew VAWA, A19, editorial – The 1994 Violence Against Women Act “is credited with sharply reducing the number of domestic violence deaths and providing life-saving assistance to millions of women and families.”  It “provides federal dollars state and local governments can’t afford for victim’s services [and other enumerated programs].”  Yet the problem of sexual assaults has not been solved (and never will be), as “there is an average of 207,754 victims (ages 12 and older) of sexual assault each year.”  And things are even worse abroad, as demonstrated by the “ingrained contempt for not being born male” in some countries.  By the way, VAWA was “authored” by Joe Biden when he was a US senator.  So why the hold up in renewing it now?  Republicans object to “including gay and lesbian Americans” and allowing abused immigrants “to report violent crimes [without] fear of being deported.”  Shame on them, they should get in step! With this kind of thinking, government programs can never die – even if they have long since outlived their usefulness.  Seems to us the prevention and/or punishment of sexual abuse can and should be dealt with at the state and local level.  (B) When foreign competition cheats at workers’ expense, A21, Ted Kaufman – While claiming to accept the long-recognized benefits of free trade, even when fueled in part by disparities in labor rates, the writer makes the case for vitiating them by insisting that workers in other countries enjoy the same protections as US workers so that foreign-made products will be “produced in safe, clean manufacturing environments.”  Under no circumstances should “those countries have an undeserved competitive advantage based on reduced labor and environmental standards.”  How far should this logic carry, e.g., suppose Chinese workers were not deemed to be receiving a “living wage”?  It is not this country’s place to be the “nanny” for the world.  (C) Reducing poverty will strengthen middle class, A21, Wilmington City Council member Darius Brown – The writer cites a survey indicating that 23% of city residents/ 31% of city children “live in poverty.”  According to him, “it is imperative that public policy be developed and implemented to create pathways out of poverty.”  He personally plans to “participate in the Supplemental Nutrition Assistance Challenge [by] spending only $4.30 per day or $21.50 for the five-day period beginning Monday to feed myself, which is the average government allowance for an individual who needs assistance in Delaware.”  Helping people better themselves is commendable, but welfare programs breed continuing dependency.  Let’s not confuse equality of opportunity with equality of outcomes.    

1/6/13, B1/B7, National park plans move ahead; Progress made despite legislation missing a vote in last Congress, Molly Murray – “Now that the park legislation is dead . . . Delaware’s congressional delegation . . . could reintroduce the legislation . . . [or] seek a presidential declaration of National Historic Sites for the places already identified within the proposed national park.”  If there was ever a project that did not deserve federal funding, this is it.  Shame on Senator Carper for continuing to push it!

1/5/13, A1/A2, $9.7 billion in flood aid for victims of superstorm; Insurers program funds replenished, Andrew Miga (AP); Infusion of money can help Delaware get back on its feet, James Fisher – On the last day of the 112th Congress, House Speaker John Boehner sidelined a $60B bill that was supposedly an emergency appropriation for storm relief but included billions of dollars of “pork” (for spending as far away as Alaska) and was prepared without any spending offsets. Boehner was roundly criticized by many, including Governor Chris Christie (who has not been acting much like a Republican lately), but $9.7 B to replenish the flood insurance coffers was rushed through by the 113th Congress the very next day and the rest will be reviewed starting Jan. 15th.  Senator Tom Carper groused that “this small package isn’t enough” and “we have a moral responsibility to ensure that the citizens on the East Coast deeply affected by this storm have the resources they need to continue healing and rebuilding.”  Actually, the state of Delaware’s request to FEMA – which is what is being held up locally – “sought to pay for government efforts made necessary by the storm,” e.g., statewide storm water and flood control improvements.     

1/5/13, A1/A2, Del. River dredging prepares to resume; deepening 14 miles to cost $18.5 million, Jeff Montgomery – After over a decade of unproductive legal wrangling, this 103-mile shipping channel deepening project is making good progress and will apparently be completed if Congress provides the rest of the funds.  The project was reportedly authorized (in concept?) by Congress in 1992.  “Unfortunately, in this economy,” says Brenna Goggin of the Delaware Nature Society, “the environment tends not to be the most important thing for many people” and “jobs are what people want to talk about, and the promise of jobs, the hope of jobs.” The environmental drawbacks of this project were never entirely clear to us, whereas the regional economic benefits of accommodating larger ships are apparent.  

1/5/13, A1/A4, Vote to revoke charter leaves many hanging; alternatives limited if Pencader is closed, William McMichael,  The State Charter Accountability Committee voted yesterday to recommend that the state revoke the charter of Pencader Business and Finance Charter High School – upholding a preliminary recommendation in September – despite a change in membership of the school board including the installation of a new chairman on Nov. 11 – the vote came less than a week before the deadline for parents to submit public school choice applications to the district they want their children to attend.  A former Pencader parent named Renee McCutchen (probably the same woman quoted in a 9/11/12 story) says “there’s just too much surrounding that school” - “they can’t seem to get it together” – “the kids are suffering there.”  Given that McCutchen pulled her children out of Pencader months ago, she may be pursuing a personal vendetta of some kind.  And from the sound of it, we don’t think the authorities have handled the situation very well either.  According to the story, however, the most likely outcome is probation versus actual closure so the new board members may have an opportunity to keep trying.

1/5/13, A6/A7, Wind industry hails credit extension; support “instrumental” for many projects, Aaron Nathans – Buried in the “fiscal cliff” deal was a provision extending tax credits for all wind [energy] projects that start construction in 2013.  The credits had been scheduled to expire at the end of 2012.  Jim Lanard, president of the Offshore Wind Development Coalition in Washington credited Senator Tom Carper with “successfully advocating for the extension.”  Although “few offshore wind projects are prepared to begin physical construction this year,” it’s said “a contract for equipment or a down payment may be enough to qualify.” Also, wind advocates hope that keeping the credit alive will now be easier than trying to start from scratch.  And the extension will supposedly save 37,000 jobs.  “Now we can continue to provide America with more clean, affordable, homegrown energy,” said Rob Gramlich, interim CEO of AWEA.  Senator Carper pledges that “I will continue to fight for these kinds of common sense investments that grow our economy, and our dependence on foreign oil and help clean our air.”  Offshore wind power is an expensive boondoggle, which should not be supported by taxpayers.  It’s too bad this provision got sneaked into the bill, which most senators voted for without reading at 2:00 AM on New Years Day, and we hope the error can be rectified in the context of real tax reform. 

1/5/13, A9, Lawmakers have naïve view of how healthcare works, Christopher Casscells (CRI) – Column responding to 12/12/12 column by State Reps. John Kowalko & Earl Jacques on the need for Delaware to adopt single payer healthcare.  According to the writer, it simply not true that healthcare insurers add no value (only extract profit) or that the state can provide healthcare to anyone without “the full cooperation of the Christiana Care Healthcare System.”  Healthcare services that cannot continue to be provided without adequate payment will simply “cease to be available,” resulting in a situation known as “legislated rationing.”    Our comments on the story were to a similar effect: Point 1 [GovCare will leave many people without healthcare insurance] is true, point 2 is dubious, and points 3-5 are nonsense.  Remember, “if it sounds too good to be true . . . “.  This column demonstrates a point made in SAFE’s 12/3/12 blog: “Even its supporters do not see GovCare as an ideal solution, but rather what Senator Tom Harkin (D-IA) called a ‘starter home.’  What the left really wants and will keep pursuing is universal healthcare coverage (single payer system).”

1/3/13, a litany of second thoughts about the latest fiscal fix:  

(A) Carper: Fiscal cliff deal “insanity,”A1/A5, Nicole Gaudiano – Following up on a 1/2/13 story, Carper was one of the 8 senators who voted against the deal.  He reportedly considered his vote “an easy call” because the legislation was “an example of last-minute fixes to big problems that aren’t being addressed,” i.e., did nothing about either tax or entitlement reform. In the 113th Congress (which will be sworn in today), Carper says he will use his new chairmanship of the Senate Homeland Security and Governmental Affairs Committee to “poke into every corner of government” for ways to spend taxpayer money more wisely.  Among other things, he will look for “big ideas” for Medicare reform.  He also plans to introduce Social Security reforms along the lines of those in the Bowles-Simpson plan that went nowhere in 2010.  As Carper sees it, such changes could give Democrats a bargaining chip to negotiate with Republicans for additional tax increases.  Senator Carper’s concerns about balance are praiseworthy, but he doesn’t seem to really get the point.  The only way to fix a spending problem is to cut spending. Senator Chris Coons and Rep. John Carney both voted for the cliff deal, for all their statements that they would have preferred a more comprehensive deficit reduction deal. 

(B) Fiscal Cliff deal is just another pain-free punt, A5, Charles Babington (AP) – The deal will reportedly only “generate $600 billion in new revenue over 10 years,” while putting off “the toughest decisions about spending cuts for military and domestic programs including Medicare and Social Security.”  According to William Gale of the Tax Policy Center, “going over the cliff [i.e., raising taxes on everyone, not just high earners] would have put us on a better budget path.”  Rep. Darrell Issa (R-CA): Congress put “the smallest finger in a dike that in fact has hundreds of holes in it.”  Labor leader Richard Trumka: postponing the $1.2T (over 10 years) sequester and leaving the debt ceiling unresolved, the deal “[sets] the stage for more fiscal blackmail.” The reporter: Americans got what they have demanded from the federal government for years, namely “High levels of government service.  Low levels of taxation.  Big deficits to make up the difference.” 

(C) Stocks soar on budget deal, but problems still lurk, A9, AP – Stock prices soared yesterday, both in the US and abroad, including a 300+ gain in the Dow.  However, “despite the euphoria, many investor remained cautious” because “the deal merely postpones the country’s budget reckoning . . . rather than averting it.” 

(D) Still kicking a big can down the road, A10, editorial – Congress has finally acted, doing some good (such as permanently indexing the AMT for inflation), “but it mostly put the problems off to another day.”  That day will be coming “as early as March” when the debt ceiling (which could result in a debt default) and end of the 60-day setback of the spending sequester (which could cause Congress to “begin to mindlessly cut programs”) hit.  “We should be wary,” the editors pronounce portentously, “of reading ‘winners’ and ‘losers’ into this drama.”  At bottom, the “immediate deficit problem” was caused by “the Bush-era tax cuts” [not really] and a “recession, which reduced revenues.”  But beyond that, there is a demographic crisis because “we are moving toward a country with an aging population and an expensive healthcare system that must be supported by a smaller work force.” And this problem was not manufactured in Washington but “we have trouble getting people to focus on it.” Sorry, but we cannot recall the News Journal attempting to get people to focus on the fiscal problem in a realistic way.   

(E) When governing means lurching between phony crises, A11, Clive Crook (Bloomberg View) –What “the economy needs,” states the writer, is “a fiscal compact that commands broad bipartisan support.”  But the president “has chosen to strut more than conciliate, to be a partisan champion sticking it to the enemy, not a one-nation leader seeking to build agreement.  Declaring victory this week [as has already been done] won’t serve his or the country’s interests.  A little magnanimity would go a long way.  Nevertheless, count on the Republicans to do all they can to make presidential aggression look good.”  If the president seeks “to split differences, build consensus and solve problems,” he may still fail (due to those nasty Republicans?).  But if he “[stands] on principle [namely?], [berates] the opposition (and the half of the country that it represents) and [keeps] the crises coming . . . he can count on it.”  The president will not willingly move to the center, in our opinion, because that is not who he is.  It’s up to the opposition to do a better job of blocking the big government express than they have done so far. 

1/2/13, A1/A2, Fiscal cliff averted: House GOP concedes to demand for higher taxes on the rich; Passage comes on heels of Senate bill that Biden worked on, Lori Montgomery & Rosalind S. Helderman (Washington Post); and Carper goes against Biden’s deal; Delaware lawmaker hope for tough “grand bargain to end budget crises, A1/A3, Nicole Gaudiano – These and related stories take up the first three pages of the newspaper.  Most of page one is a white print on black background display including images of the vice president and president appearing at the White House to announce the House vote, Reps. Eric Cantor & John Boehner walking to a Republican caucus earlier in the day, and the US Capitol dome.  The outcome is described as a “triumph” for the president “after he campaigned for re-election on higher taxes on the wealthy.”  And for all their reservations about the bill, “GOP lawmakers decided not to take a gamble that could force the nation to face historic tax increases for virtually every American and leave House Republicans to take the blame.” Vice president Joe Biden’s role in working out the terms with Senate Minority Leader Mitch McConnell (R-KY) is duly noted, with McConnell calling Biden after his talks with Majority Leader Harry Reid (D-NV) broke down.  Senator Tom Carper’s “no” vote is also played up. For a little state, Delaware does manage to get in the news a good bit. Finally, Zachary Goldfarb (Washington Post) reports (A2) that “Accord doesn’t defuse fiscal bomb.”  It didn’t raise the debt ceiling, “do anything [e.g., extend the payroll tax cut] to address stubbornly high levels of unemployment,” or “fundamentally tame the government’s soaring debt.” Supposedly, the president wanted to do a bigger deal, offsetting “deep spending cuts” ($1.2T sequester over 10 years?) with “more taxes and more targeted savings in entitlements, including Medicare and Social Security.” The “more taxes” part is right; we’re not sure about the rest of the statement.  Better do something quick, because “leaving the fate of the debt ceiling up in the air will cause anxiety among businesses and individuals, potentially crimping hiring, investing and consumer spending.”  Goldfarb must be a dyed-in-the-wool believer in Keynesian economics.     

1/1/13, A1/A2, 11th hour cliff deal; across-the –board tax hikes halted; earners of $400,000 or more not so lucky, David Espo (AP) – This story plus several related ones take up the top of the front page and all of page 2. Kudos are awarded to Vice President Biden and Senator Mitch McConnell for brokering the proposed deal, tax increases involved are described as coming “after a period of tax cutting that began in 1997” [there have been some tax hikes along the way, including higher cigarette taxes to finance CHIP and the barrage of tax increases embedded in the GovCare legislation], deferral of any spending cuts of substance is acknowledged.  Remaining obstacles: Senate approval (which came overwhelmingly about two hours after midnight) and House consideration. Speaker John Boehner, it is reported, “refrained from endorsing a package as yet unseen by his famously rebellious rank-and-file.” Time will tell how this plays out – stay tuned.

1/1/13, A11, Disability insurance in need of tough medicine, Edward Glaeser (Harvard professor and a Bloomberg View columnist) – The column notes the growing number of Americans who are drawing disability payments from Social Security – now up to 8.8M.  Thirty years ago, it is said, “there was a 40-to-1 ration between the total labor force and those worker receiving Social Security disability payments” and now the “ratio is less than 18-to-1.”  And the primary reason(s) are probably either that “work has become less attractive” or that “disability insurance has become more attractive and available.”  A 1984 law change is noted that generalized the eligibility requirements, which were previously based on “a list of specific impairments” that were more objectively verifiable than the current “general consideration of a person’s medical condition and ability to work.”  About 1/3 of workers now on disability have been diagnosed with mental disorders.  So should the system be tightened up to make it tougher to get on and stay on the dole?  Nope, this possibility is not even mentioned.  The “tough medicine” proposed is to invest in human capital by improving our education system, increase the earned income tax credit, and cut payroll tax rates for poorer Americans.