BEAT's Blog

Canada produces about 2.8 million barrels of crude oil per day, much more than it needs.  Most of that comes from the country’s western provinces –primarily Alberta.  But Canada’s industrial and population centers are primarily in the eastern part of the country.

Canada’s eastern provinces are right now importing European oil.  It would seem logical that Canada should ship its western crude to its eastern cities.  There are two reasons that this doesn’t happen.  First, there is no pipeline between Canada’s western and eastern centers.  Second, the refineries in the eastern part of the country are not able to handle the thick tarsands crude that is mined in the west.

The solution that Canada came up with to solve this problem was to build a short pipeline that connects the Alberta tarsands with its west coast ports in British Columbia.  This would allow the oil to be sold in the more lucrative Chinese and European markets.  (As I’m writing this, the price difference is about $20 per barrel.) The problem is that the Canadian environmental movement was able to stop the construction of this pipeline.

So what was Canada’s Plan B?  Sell the oil to the United States.  There are some problems with this idea, too.  The refineries in the United States are all the way down in Oklahoma, Colorado, Wyoming, and Texas.  There are some small pipelines that could get the oil to the Oklahoma, Colorado, and Wyoming refineries, but none that would bring it all the way down to the refineries in Texas.  (There are also existing pipelines that bring tarsands oil to Illinois refineries.)

So maybe the solution is to send tarsands oil to Oklahoma, Wyoming, Colorado, and Illinois, and forget about trying to send it to Texas.  It would seem that this solution, using existing pipelines, would be sufficient, and that is the solution that is currently being used.  But there are two related problems with this solution.  First, the market in the western United States can only absorb so much crude.  Canada is producing about 3 million barrels per day.  All that crude sitting in the western U.S. is starting to lower the price of gasoline.  The lowest gas prices in the U.S. right now are in Wyoming, Colorado, and Oklahoma.   This is because that’s as far as the pipeline goes.  The oil companies in those states are filling storage tanks as fast as they can, rather than sell the excess at lower prices. Shipping it to the markets in the eastern U.S. is impractical for the same reason that it is impractical to ship to Canada’s eastern markets.

Now we have plan C.  Build a pipeline from Canada right down to the refineries in Texas.  You might wonder how this would solve the problem.  After all, Texas is still in the western U.S., and it’s even farther from the population centers and industrial markets in the east.  To understand the logic behind Plan C, you have to understand a little about the oil market. Read more…

The proposed XL Pipeline is a pipeline that would bring Canadian tarsands oil across the Midwest and into Texas.  In a previous post I pointed out some of the environmental harm that comes from the tarsands operation itself – in other words, the local harm that is being done in Alberta, Canada by the mining operations there.  The pipeline would add to this harm and bring it to the U.S.  The proposal is for a pipeline through some very sensitive habitat, through property owned by people who don’t want to sell, and over aquifers that provide drinking water for two million people and irrigation water for 27% of the country’s agriculture.  But when I discuss this issue with people, two issues keep coming up.  People often see construction of this pipeline as a way to lower gas prices and as a way to decrease dependence on oil purchased from countries less friendly than Canada.  I guess the idea is that suddenly the benevolent oil magnates are fighting for us, the little guys, while environmentalists are getting in the way.  Let’s take a closer look. Read more…

BEAT has been arguing that the biggest environmental problem we face is corporate influence in government.  It’s the one issue that makes all other issues intractable.  A recent  Supreme Court decision that ruled in part that corporations are people has made the situation much worse.  But now, the U.S. Supreme Court is set to hear a case in which Royal Dutch Petroleum will argue that the law by which it is being sued for aiding the Nigerian government in torturing and executing the people of Nigeria does not apply to them in part because it applies to people, not to corporations. Royal Dutch Petroleum is being supported in this contention by Exxon, Coca Cola, BP, and the U.S. Chamber of Commerce.  Make up your mind Pinocchio.  Do you want to be a real person or not?

In the past year or so, there’s been a lot of discussion about the Alberta tar sands project and about the proposed XL Pipeline that would carry oil from that project to Texas.  My wife Jane and I were concerned enough to travel to Washington D.C. to participate in two demonstrations aimed at stopping this pipeline.

News photo from Huffington Post

Why all the fuss over this project?  Let me try to explain.

First, you have to understand the context in which this project occurs.  The world is running out of oil.  The icon of the Texas oil baron was created in the 1950s when the United States was producing 9 or 10 million barrels of oil per day.  Even with the subsequent discovery and exploitation of the large Alaskan reserves, the U.S. as a whole is now producing only about half that amount.

With the high price of oil, believe me, if we could wring more oil out of U.S. oil fields, we would.  It’s just not there.   And if this isn’t bad enough, our energy demand is still increasing.

So when our neighbor to the north says they have an oil reserve that represents about 75% of North American oil reserves, everyone takes notice.  But let’s put the size of this Canadian reserve in perspective.  It’s projected that the Alberta tarsands can produce about 900,000 barrels of oil per day.  Granted, this is a lot of oil, but it represents only about 1% of the world supply.  It’s also very expensive to extract – much more expensive than the kind of oil that comes out of oil wells.  If we weren’t running out of oil, we would never even consider mining this expensive-to-mine petroleum source.  So we should first dispel any hope that this oil reserve is going to lower prices at the pump .  Those prices are determined on an international market and by whatever executives in the oil industry decide they would like to have as a profit.  The Alberta tar sands oil will have no effect on gas prices and will not significantly postpone the depletion of the world’s oil reserves. Read more…

This past fall, the Occupy Wall Street group made a lot of headlines pointing out that one percent of this country’s population controls a very disproportionate share of the wealth.  Tied in to this is the fact that recent federal court rulings have taken almost all restraints off corporations who want to make contributions to politicians.  Of course, when business leaders pay out money in the form of contributions, they expect something in return, and they get it.  Corporate taxes have been plummeting, corporate profits have been soaring, and politicians have become much more responsive to their contributors than to their constituents.  The result of all this is that politicians respond to corporate directives rather than to public needs.  In effect, our democracy has been seriously damaged.

As I said in a recent blog:

In the most recent CNN opinion poll (April 2011), when adults were asked “Would you favor legislation that would prevent the Environmental Protection Agency from spending any money to enforce regulations on greenhouse gases and other environmental issues, or do you think the federal government should continue to provide funding to the Environmental Protection Agency to enforce those regulations,” 71% favored continuing funding.  28% were against funding.  Less than a year ago, in a Pew Research poll, adults were asked, “Right now, which ONE of the following do you think should be the more important priority for U.S. energy policy: keeping energy prices low or protecting the environment?”  56% favored protecting the environment.  37% favored keeping prices down.  Less than a year ago an ABC News/Washington Post poll asked, “Do you think the federal government should or should not regulate the release of greenhouse gases from sources like power plants, cars and factories in an effort to reduce global warming?”  Democrats favored regulation 81% to 16%.  Republicans favored regulation  55% to 39%.  Independents favored regulation 69% to 27%. It’s no wonder that the approval rating of Congress is at an all-time low.

Read more…

In my last blog, I pointed out that the wages of the average worker in this country have been dropping precipitously since 1980 despite increased worker productivity, that corporate profits have been soaring, and that CEOs are keeping these record profits for themselves with little to no sign of any “trickle down” to workers.

Of course, you might say that this is just the way capitalism works.  In the United States everyone is free to make their own future.  We are admired by those in other countries because here one can climb from the bottom of the heap and become the CEO of a major corporation.  But just how true is that?  Here is a graph showing the likelihood of climbing out of poverty in different countries.

Maybe we used to be the land of opportunity, but those at the top have worked hard at locking in their favored positions and locking the rest of us out.  And exactly who are these poor people?  More and more, they are the most vulnerable among us.

So how did we get here?  What prevented this from happening during the post World War II boom and what has changed since then?

One of the strongest forces in keeping the wages of workers commensurate with those of top executives was the labor union.  Organized labor was very effective starting in the 1930s and was very influential in creating the American middle class.   Unions lobbied for higher wages, stronger benefit packages, and for social-justice issues such as civil rights, fair housing, and increased aid to education.  Labor unions were a force to be reckoned with and were listened to in Washington.  As a matter of fact, they had at least as strong a voice as corporate lobbyists.

For a number of reasons, union membership has been declining since the late 1950s. Part of the reason is the country’s transition from a manufacturing economy to a service economy.  Part of the problem was also an image problem caused in part by a number of corruption scandals involving labor leaders in the 1970s.  Whatever the reason for the decline, by the time Ronald Reagan took over the presidency, the unions were weak enough for his administration to deal a body blow.  He made the air-traffic controllers an example of what could happen to a union if management just said no.  He let corporate executives know that if they aggressively attacked unions, the federal government would not interfere.  And he fostered the perception that unions were greedy, corrupt, anachronisms and were counterproductive to economic progress.

With advocates for labor safely incapacitated, corporations were free to start taking a larger share of the profit pie despite increased worker productivity.

Notice how CEO compensation rises and hourly wages fall as union membership declines.

But if you are a CEO, it’s not enough to take a bigger piece of the pie.  Wouldn’t it be great if the pie itself were bigger too?  But how do you manage that?  Of course the old fashioned way would be to work harder and be smarter, but it turns out that there are shortcuts.

CEOs know about investments and returns on investment.  They know that if they take some of their new-found cash and put it to work, they can make it grow.  So where do they invest it?  Here’s a graph of recent political contributions to federal election campaigns.

If you’re thinking that the average person can’t be donating that much money to candidates, you’re right.  Here’s where the money is coming from.  Note the part of the pie that comes from corporations and trade groups.  Note how small a piece comes from labor and individuals.

So what do corporations get for their investments?  Here’s a graph of corporate taxes over the past 60 years.

In a recent speech, Vermont Senator Bernie Sanders made the following points.

1)      Exxon Mobil made $19 billion in profits in 2009.  Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS.

2)      Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion.

3)      Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS.

4)      Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009.

5)      Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year.

6)      Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction.

7)      Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department.

8)      Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury.

9)      ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2006 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction.

10)  Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.

So the government has helped corporations to cut their payroll expenses by curbing labor unions and has helped corporations cut their tax bills, but this hasn’t satisfied corporations or their CEOs and the rest of the 1% of the population who hold half of the nation’s wealth.  They are now looking for their recently purchased legislators to cut another one of their expenses; the expense of having to comply with environmental regulations.

In my next blog I will show how all of these economic and political factors are at the root of most of our environmental problems.

It has never been easy advocating for the environment, but these days it’s especially difficult for BEAT. It seems that every regulation protecting the environment is under attack. Every attempt to clean up environmental pollution is met with resistance. Protecting rare and endangered species annoys the real-estate industry and the lobbies representing developers. Trying to extend the bottle bill means doing battle with the bottling industry. And of course any attempt to get PCBs out of the Housatonic River is met with the full force and money of GE and its well funded allies. Almost every time we meet resistance in protecting the environment, there’s a corporation or well connected business interest standing in the way. Why is it so difficult to protect the environment and the health of all of us? How did we get to the point where we allow and sometimes encourage corporations to endanger our health and that of wildlife? It turns out that this is not primarily an environmental problem. Bear with me while I start down what might at first seem like an unrelated path. But the path I want to take really is the path that leads to the answer.

In 1979 the American worker’s average hourly wage was equal to $15.91 (in 2001 dollars). By 1989 it was at $16.63/hour. That’s right. In ten years, wages went up 70 cents an hour. Over the next six years, wages rose by 8 cents to $16.71. Compared to inflation, wages have not fared well over the years. Here’s a graph showing a year-to-year comparison of wages from 1925 to the present.

Notice that wages in effect dropped suddenly around 1980, and have never recovered. Employers have replied to demands for higher wages by saying that only higher productivity could justify higher wages. Do they have a point? Here’s a graph of American worker productivity over the last 65 years.

So workers are becoming more productive and are getting paid less. Of course that doesn’t necessarily mean that the profits of corporations are going up. But they are. Here’s a graph of recent corporate profits.

So corporations are making larger profits than ever, and they are not passing them on to workers. Where are all the profits going? Here is a graph of the ratio of CEO compensation to worker compensation. In other words it shows how many times greater the CEO’s paycheck is than the average worker’s paycheck.

Notice that CEOs are paid about 300 to 500 times what their workers are paid. The CEO of WalMart makes more in one hour than his average worker makes in a year. Here’s what this ratio looks like in other industrialized countries.

The result of all this is that the wealthiest 1% of Americans now own more than half of all the nation’s wealth. And in case your smiling and thinking that you are part of this elite group, let me be the first to tell you that you aren’t even close. The top 1% of Americans earn on average $1,117,000 a year.

It’s interesting that since 1979, the economies of the U.S. and of the industrialized European countries have grown pretty much at the same rate. However, industrialized European countries do not have the same disparity in pay between CEOs and workers, and as a result, European workers do not have the same wage stagnation as American workers. The European worker has been allowed to share in the economic benefits that have accrued since 1979.

So things are good for the ultra-wealthy. But the question is, can they maintain the status quo? Can they protect the wealth they have accumulated? Can they maybe continue the acceleration into the economic stratosphere? Sure they can. This is where bipartisan cooperation comes in. By bipartisan I mean both government and corporations. Next time: how government created this mess and why it won’t fix it. And yes, all of this does relate to environmental advocacy. In fact, I believe it is the most important environmental issue facing us on the local, state, national, and international levels. I’ll get to that.

GE has announced that it is transferring its 115-year-old X-Ray manufacturing operations from Wisconsin to China.  It has also announced that it will invest two billion dollars in China, open 6 new research centers there, and train 65 new Chinese engineers.  This is the same mega-corporation that last year payed exactly no U.S. corporate income taxes at all despite profits of 14.2 billion dollars, and that now, after a series of job cuts in the U.S., employs more people overseas than in the U.S.   To add insult to injury, GE received a 1.1 billion dollar tax credit from the U.S. government as part of the financial industry bailout.

To put this amount of money in perspective, keep in mind that the cleanup of PCBs that GE has been fighting for decades will probably cost only hundreds of millions of dollars.  And yet, GE says that it will sue if the EPA makes them do any cleanup at all.  Apparently building China’s economy is more important than cleaning up toxic PCBs from the communities that previously supplied GE’s labor force.

Here’s a quote from Jeff Immelt.

“When I am talking to GE managers, I talk China, China, China, China, China.  You need to be there. You need to change the way people talk about it and how they get there. I am a nut on China. Outsourcing from China is going to grow to 5 billion. We are building a tech center in China. Every discussion today has to center on China. The cost basis is extremely attractive. You can take an 18 cubic foot refrigerator, make it in China, land it in the United States, and land it for less than we can make an 18 cubic foot refrigerator ourselves.”

But don’t worry.  Our government is on top of the situation.  President Obama recently appointed a new job czar to help figure out why our country is losing so many jobs and to help develop a strategy for getting those jobs back.  Who did he appoint to this position?  GE’s CEO, Jeff Immelt.   So will the President be able to convince Immelt that maybe he should pay more attention to his home country, and maybe he should consider cleaning PCBs from the Housatonic River?  On the contrary.  We now have word that Jeff Immelt has convinced President Obama to put pressure on EPA to back off from a Housatonic River cleanup.

PCBs cause cancer.  They are known carcinogens in animals, and suspected carcinogens in humans.  We can’t do studies on humans the way we can on animals, so scientists may never be able to say with scientific certainty that PCBs cause cancer in humans.  In GE’s mind, and in the minds of its defenders, this means “no worries, mate” – at least for CEOs who don’t live in the Berkshires.

Cancer is a serious issue.  So are the other problems caused by PCBs – reproductive disorders, behavioral disorders, neurological disorders, etc.   The people of Berkshire County have to get angry.  They have to find their voice and demand a cleanup of the river.  It has become quite clear that we won’t be getting any help from the Obama-Immelt administration or from any other elected officials.

Pharmaceuticals on the whole are a wonderful thing.  So many diseases and disorders that plagued earlier generations can be prevented or made less harmful and less uncomfortable by products of the drug industry.  This is because pharmaceuticals are designed to change our physiology.  They are designed to make changes to the way our bodies work.  This is what we are looking for when we take a prescription or an over-the-counter medicine.  We want a chemical that will affect our bodily processes.

But how many times have you flushed unwanted and unused portions of these products down the drain?  Or maybe you’ve thrown them in the trash so that they end up in a landfill where they can find their way into groundwater or nearby waterways.  Even if you use all of the product you purchase, much of the active chemicals in these products go right through your body unchanged and end up in the toilet to be flushed and sent on to the local wastewater treatment plant.  Add to this all of the veterinary medicines, hormones, and antibiotics and we have an even bigger problem.

You might think that the wastewater treatment plant is the perfect place to send these products, but actually, wastewater treatment plants do not remove pharmaceuticals from the wastewater stream.  They send them right out with the rest of their discharge, usually into a river.  In a recent study by the U.S. Geologic Survey, 80% of the rivers tested and about 25% of the groundwater tested contained pharmaceuticals.  Is this a problem?

Remember that these are chemicals that are designed to change our physiology, and also remember that our basic physiological processes are the same as those of other living things.  This means that every day we send biologically active drugs and medicines into our waterways and wetlands and, in effect, administer medicine to fish, frogs, turtles and other living things.  Does this have an effect on aquatic wildlife?  Of course it does.  These chemicals were designed to have a biological effect.  Of course these animals are getting a less concentrated dose, because the chemicals are diluted by the water in the river, but this is counterbalanced by the fact that aquatic animals sit in this toxic soup 24 hours a day, 7 days a week.   Researchers have linked these pollutants to reproductive disorders in fish and amphibians.  The problems include lower sperm counts and damaged sperm.  Some male fish and frogs have become “feminized,” meaning that they have developed both male and female reproductive structures.  The scientific literature documenting these kinds of problems is growing quickly.

It’s not just aquatic wildlife that gets unintentional doses of medicine.  In some communities, these drugs have found their way back into our drinking water supply.  We are drinking each other’s prescriptions, in trace amounts, but constantly, day in and day out.  There is currently no federal requirement for testing drinking water supplies for pharmaceuticals.  Distributors of bottled water are also not required to test for pharmaceuticals.  An Associated Press investigation found that “A vast array of pharmaceuticals including antibiotics, anti-convulsants, mood stabilizers and sex hormones have been found in the drinking water supplies of at least 41 million Americans.”

So what can we do?  Researchers have found a simple technology that has been proving effective in breaking down pharmaceuticals.  The effluent from wastewater treatment plants is sent into small wetlands that are constructed especially for the purpose.  The microorganisms in these constructed wetlands biologically degrade a high percentage of the pharmaceuticals in the wastewater.  This technology is already implemented in some communities.

Another solution is to dispose of your medications properly.  BEAT can help with this.  On October 29, BEAT will be partnering with the Berkshire United Way, the Berkshire Attorney General’s Office, Berkshire Health Systems, and a number of other groups in the RX Roundup.  At a number of sites throughout the county, you will be able to turn in your unwanted prescription medications, over-the-counter remedies, and personal care products for safe disposal.  Each site will be supervised by law enforcement officials.  This is a great time to clean out your medicine cabinet.  This not only helps the environment, but also helps to reduce the supply of prescription medications available illegally on the street and reduces the likelihood of drug-related accidents among small children.

The date is October 29.  You can check newspapers or BEAT’s website for more specific information as the date approaches.

I saw this video on YouTube.  Please watch it to the end.  What a testimony to the value of helping wildlife!