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Archive for December, 2012

In their recent op-ed for the “Campaign to Fix the Debt,” New Hampshire State Senator Lou D’Allesandro and former Pennsylvania Governor Ed Rendell used several paragraphs to explain the danger that the country could go over the “fiscal cliff,” which they describe as “a series of across-the-board spending cuts and tax increases that will hurt everyone.”

That these measures, intended to reduce the federal government’s fiscal deficit, have aroused dread even among leaders of “Fix the Debt,” should be proof that the “debt’ is not the biggest problem we face. In the short run, the top economic problem the country faces is under-employment and stagnant wages for most workers.

The major cause of the current federal deficit is the economic collapse that began in 2008. When the economy melted down, the taxable income of workers dropped. Moreover, un- and under-employed workers were more likely to receive federal payments such as unemployment insurance, Medicaid, and food stamps.

The other significant causes of the deficit are the tax cuts pushed by President George W. Bush and extended/expanded by President Obama, and rapid expansion of military spending, including (but not limited to) the invasions/occupations of Iraq and Afghanistan.

The cost of Social Security has nothing to do with the current deficit. If the population and economy grow at normal rates, the future workforce will deposit enough into the system to fund the retirement of those who are working now, especially if Congress raises the payroll tax cap and permits millions of undocumented immigrant workers to enter the formal economy.

Long-term, the cost of Medicare and Medicaid could pose a significant burden on the economy. But this has everything to do with the larger problem of rising health care costs and nothing to do with the fact that these are “entitlement” programs.

If the nation insists on cutting the deficit, we should return our attention to its causes: tax rates, excessive military spending, and the recession itself. If we fix the economy, the debt will take care of itself.

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Cartoonist Needed

Any artists out there?

Frame One:  Teacher gets out of car with shoulder bag, books.  Big brick building is in the background.

Frame Two:  Teacher, seen from behind, goes through metal detector in doorway of school.

Frame Three:  Guard to teacher: “Sorry I can’t let you in the the building.”

Frame Four:  Guard to teacher:  “You’re not allowed in school without a gun.”

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The concrete under the nuclear reactor in Seabrook is rotting. (The official term is “alkali-silica reaction.”)  The nuclear reactor in Vernon, Vermont has outlived its useful life and is now operating outside the laws of the state.  It should be shut down immediately for safety reasons.  Hydro-fracking to produce natural gas is poisoning the air, water, and food supplies.  The burning of coal is changing the earth’s climate and some means of extracting it are destroying human lives and the natural environment.  The “Northern Pass,” a proposed network of power lines to connect the New England power grid with that of Quebec, will draw its electricity from reservoirs created by diverting rivers and flooding thousands of square miles of land, mostly land inhabited by First Nations people.  Whatever you think of the giant towers that have been proposed to transmit this electricity it’s not exactly “green energy.”

Having gotten that out, I have to say I’ve had generally positive thoughts toward plans to generate electricity from wind on New Hampshire ridges.  But it has not escaped my attention that objections to industrial wind farms in New Hampshire remind me of objections to similar projects in Oaxaca, Mexico.  And the cast includes some of the same corporate characters.

The December 11, 2012 NH Union Leader reports:

Opponents of a planned 37-turbine wind-power project on 6,000 acres of private land in Grafton, Alexandria and Danbury have started a petition asking state officials to stop the development.

"The negative consequences of this industrial wind farm development far outweigh the benefits. We the people want this stopped to protect our homes, our land, our communities," states the petition, which was written by Grafton resident Erin Darrow.

The project is planned by Spanish wind-energy giant Iberdrola Renewables, which recently built a 24-turbine, $120 million 48-megawatt wind farm in Groton.

Iberdrola also faces persistent resistance in the Isthmus of Tehuantepec, the narrow part of Mexico between the Pacific and Caribbean in the eastern part of the state of Oaxaca, where it is one of the main developers of industrial wind farms.

A recent article by Jennifer M. Smith and published on Upside Down World states:

In April of 2004, the United States Department of Energy (DOE) and the US Agency for International Development (USAID) sponsored a study to accelerate the development of wind projects in the state of Oaxaca, which found that the best area for wind project development was in the Isthmus of Tehuantepec, in the heart of the ancestral Ikoots territory. 

Local residents have objected for several years to the terms of agreements between foreign windpower developers like Iberdrola, local landowners who cut private deals without community approval, and the far-off corporations that contract directly for the electricity.  Smith writes:

There are currently 14 wind farms built on land in the Isthmus of Tehuantepec, with 4 under construction in 2012 and 3 more scheduled for 2013. According to the Declaración de San Dionisio del Mar, released on September 17 by the indigenous rights organization UCIZONI (La Unión de Comunidades de la Zona Norte del Istmo – The Union of Communities in the North Zone of the Isthmus), the communities affected by the 14 existing wind farms have not benefited from lower electricity rates; rather, the intention of the farms is clearly to serve the interests of transnational corporations such as Coca-Cola, Walmart, Nestle, Bimbo [Mexican manufacturer of a Wonder Bread-like product] and others. The wind turbines in San Dionisio are the first proposed turbines to be built in the sea. 

[See this article in Noticias, a Oaxaca daily published in Spanish, for a list of the wind projects.]

The developer behind the San Dionisio project is Mareña Renovables, which is owned by Mcquarie, an Australian investment bank. 

According to Jennifer M. Smith,

The proposed Parque Eolico San Dionisio (San Dionisio Wind Park), a wind farm to be constructed in the ocean along the coast, would consist of 102 wind turbines in the water outside the town of San Dionisio del Mar (and 30 more outside neighboring Santa Maria del Mar), two electric transformer substations, six access paths and additional support structures. It would take up 27 kilometers of coastline.  The multinationals implementing the project have also informed the Mexican government that they will need to install 5 mooring docks in the Laguna Superior, a coastal lagoon that local communities heavily depend on for fishing.

Mcquarie, by the way, happens to own 55% interest in the company that owns the company that owns the company that owns the company that owns the company that operates the water utility serving Hampton, Hampton Falls, and Rye NH.  (The other 45% is owned by an entity called British Columbia Investment Management Corporation.  I don’t know whose investments they are managing in this case.)  One question that has surfaced in relationship to such arrangements concerns the possible impact of international trade agreements on attempts to regulate projects owned by foreign investors. 

Members of the indigenous Ikoots community, which has lived in the Isthmus of Tehuantepec region for thousands of years, say they would not even benefit from jobs on the project, which puts their traditional fishing livelihood at risk.  They have organized local protests and gone as far as Mexico City to get the attention of government agencies.  

It will be interesting to see if local resistance in New Hampshire follows a similar trajectory.  In both countries it will be interesting to see if wind farms can be developed in ways that meet community needs for democratic accountability and also meet needs for sustainably produced electricity.  

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February 28 is New Deadline

New Hampshire’s Executive Council voted today to extend the contract of a private consultant that has been evaluating proposals from four firms interested in for-profit operation of the state’s prison system.  The consultant, MGT of America, now has until February 28, 2013, to complete its work.

The original contract, approved by the Council in July, called for the firm to turn in its report by October 5 and to be available until the end of that month to explain its findings.  When that date arrived, the company was given an extra ten days.  When October 15 arrived, the Department of Administrative Services said completion of 12-5-12 003the report would be delayed until mid-November.  When mid-November arrived, Administrative Services said the report would be done in mid-December.

MGT will not get additional payment beyond the $171,000 of the original contract.

The main impact of delay is that MGT, Administrative Services, and the Department of Corrections will be reporting at the end of February to a new Governor and a changed Executive Council. 

Bob Sanders of New Hampshire Business Review reported this morning:

The state received the four bids last spring after issuing a relatively vague request for proposal last spring to build and perhaps run a prison to handle all of the state’s inmates. Thus far, no other state has turned its entire prison population over to a private company.

That RFP was the result of even vaguer legislation – never debated by lawmakers but instead tucked into a large budget bill — that appeared to be more interested in looking at shipping inmates out of state to private facilities elsewhere. However, the wording morphed into an RFP for a private prison company to set up a facility so large that it would have the capacity to import prisoners in from other states, an idea favored by outgoing Gov. John Lynch.

Asked by outgoing Councilor Dan St. Hilaire if it is still worth it to finish this project, Commissioner Linda Hodgdon of Administrative Services told the Governor and Council the report would put a “whole comprehensive report in front of you” for consideration as they look into whether and how to replace the women’s prison in Goffstown and the men’s prison in Concord.

When retiring Councilor Ray Wieczorek said the information would help the new Governor and Council decide whether to pursue privatization, Governor Lynch said there are many forms of privatization.   “We need a new women’s prison and at some point we’re going to need a new prison in Concord,” he said. 

12-5-12 008 Lynch has been promoting an approach in which the state would contract with a private firm to finance, build, and own a major prison that would then be leased to the state.  The ostensible advantage is that the state would not have to worry about financing a major construction project.  The political advantage would be that the expensive enterprise would be handled as a contract by the Governor and Council, thereby evading the Legislature’s always thrifty capital budget process.  But once the contract is signed, the Legislature would have little choice but to include payments in the biennial state budget.

Such an approach would also give a for-profit prison company a position from which it could make the case for full-scale privatization. 

When Chris Sununu, the Council’s most vocal privatization supporter, asked why the process had been delayed, Hodgdon said the analysis was “more complicated than any of us thought.”

Each of the four firms responded to a complex Request for Proposals that asked for details on plans to build and operate a men’s prison and a prison that would house both men and women.   Each proposal presumably also includes the build/lease option for both types of facilities.  That means there are 16 proposals to analyze, not four, and that they all need to be compared to status quo arrangements and to construction and operation of new facilities fully in the hands of the state.  

Privatization opponents hope to talk soon with newly elected Councilors.

Today was also Organization Day for the newly elected Legislature.  The House bears little resemblance to the pro-privatization gang that ran the joint for the previous two years.   Legislation to prohibit privatization may meet a warm reception.

 

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