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Moody’s Lowers Illinois Credit Rating, Again

Hmmm…what famous politician hails from the Land of Lincoln? What city is it that is considered the most corrupt, politically speaking? I can’t recall at this moment, but it seems important, for some reason.

Associated Press January 6, 2012 10:04PM

SPRINGFIELD — Illinois, unable to solve its long-running financial problems, was given the lowest credit rating of any state in the country by Moody’s Investors Service on Friday, a move that will increase costs to taxpayers.

A second agency, Standard & Poor’s, left its Illinois rating unchanged but warned of a negative outlook that could lead to a downgrade in the future. A day earlier, Fitch Ratings also left the rating unchanged and declared a stable outlook.

Lower credit ratings generally mean the state winds up paying more interest when it borrows money by selling bonds.

Both Moody’s and S&P said they are troubled by Illinois’ failure to balance its budget and strengthen government pension systems, although a tax increase and other measures have helped.

Moody’s cited “weak management practices” and a recent legislative session that “took no steps to implement lasting solutions.”

Moody’s now rates Illinois “A2,” below any other state. Only one state, California, qualifies for the next-highest rating. All the rest are ranked higher.

Standard & Poor’s flip-flops the states in its ratings. California is worst, with Illinois a notch above.

Read the rest here.

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West Readies Oil Plan in Case of Iran Crisis

By Peg Mackey and Richard Mably

LONDON | Fri Jan 6, 2012 5:12pm EST

(Reuters) – Western powers this week readied a contingency plan to tap a record volume from emergency stockpiles to replace nearly all the Gulf oil that would be lost if Iran blocks the Strait of Hormuz, industry sources and diplomats told Reuters.

They said senior executives of the International Energy Agency (IEA), which advises 28 oil consuming countries, discussed on Thursday an existing plan to release up to 14 million barrels per day (bpd) of government-owned oil stored in the United States, Europe, Japan and other importers.

Action on this scale would be more than five times the size of the biggest release in the agency’s history — made in response to Iraq’s 1990 invasion of Kuwait.

The maximum release, some 10 million bpd of crude and about 4 million bpd of refined products, could be sustained during the first month of any coordinated action, the plan says.

“This would form a necessary and sensible response to a closure of the strait,” a European diplomat told Reuters. “It wouldn’t take long to put in place if it was required … and would be unlikely to prove controversial amongst the (IEA) membership.”

A spokesman for the IEA confirmed that the Paris-based agency has an existing contingency plan that outlines a maximum stock release capability of 14 million bpd for a month. “We’re watching the situation carefully,” he said of Iran.

Tehran announced plans on Friday for new military exercises in the world’s most important oil shipping lane, through which some 16 million barrels of crude pass each day.

Read the rest here.

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Bernanke Pursuing Anti-Greenspan Strategy: Transparency

(via foxbusiness.com)

Former Federal Reserve Board Chairman Alan Greenspan clearly reveled in his reputation as a mystical overseer of U.S. fiscal policy, an oracle whose vision and judgment rose above the banalities of common economic debate.

In hindsight, that didn’t work out so well. It turns out real estate prices wouldn’t rise forever.

The 2008 financial crisis and its extended aftermath have put a significant dent in Greenspan’s reputation, not to mention the Fed’s. Now it seems Greenspan’s successor, Ben Bernanke, is on a one-man mission to restore that reputation.

A key element of Bernanke’s strategy has been increasing transparency related to Fed policy decisions and generally seeking to demystify the once-secretive entity, essentially taking the opposite approach as Greenspan.

Bernanke’s open-door policy has picked up steam as the U.S. economy has struggled to recover from the deep recession that followed the collapse of the U.S. housing market.

 

“I think the secrecy of the Fed hasn’t worked, especially in this past financial market.”

– Mark Williams, former Federal Reserve Bank examiner

 

First it was press conferences, unprecedented for the top policy maker of the U.S. central bank. Now, in a move announced earlier this week, the Fed plans to start publishing its forecasts for interest rates, presumably in an effort to provide business owners and investors greater clarity regarding future policy decisions that may spring from the Fed.

What this means is that the Fed, beginning at its January 24/25 meeting, will release interest rate forecasts provided by Fed policy makers. In addition, the Fed will release specific predictions from policy makers as to when the Fed might start raising interest rates.

Long-time Fed watchers recall that the Fed only started announcing its interest rate changes in 1994.

“I think (the shift toward transparency) is a good thing. It should help businesses gauge their activity based on the fact that the Fed won’t surprise,” said Peter Cardillo, chief market analyst at Rockwell Global Capital. “At least they’ll try not to surprise. Anything can happen.”

The thinking goes that if employers are fairly certain that interest rates are going to remain low for the foreseeable future, that certainty might serve as a powerful incentive to take advantage of these historically-low interest rates to borrow money for expansion.

“From that perspective, it might help employers to accelerate hiring,” said Cardillo.

Cardillo said Bernanke seems willing to take unorthodox steps, including opening up the Fed to closer public scrutiny, for several reasons. First, he’s “desperately trying to get the economy growing at a more respectable level,” according to Cardillo.

Second, Bernanke wants to restore the Fed’s credibility in the wake of criticism that Fed policy makers were asleep at the wheel as the U.S. credit bubble expanded at an alarming rate a decade ago as borrowing levels rose unchecked.

Finally, Cardillo believes a bit of certainty in the U.S. could provide some much-needed counterbalance to the pervasive uncertainty overseas, primarily in Europe where the long-running debt crisis has threatened a global meltdown for over two years.

Simply put, the Fed’s rate projections are intended to allow businesses to adjust to potential shifts in interest rates well in advance of the actual change.

Interest rates were lowered to a range of 0.25% to 0% over three years ago during the worst of the financial crisis in an effort to spur lending and give a boost to the ailing U.S. economy.

Historically low interest rates weren’t enough to lift ailing housing and labor markets, however, so the Fed got creative. First by introducing massive bond buying programs that pumped more than $2 trillion in cash into the economy, and later by shifting its portfolio to include a higher percentage of long-term securities. The latter was an effort to boost the moribund housing market by driving down mortgage rates.

Neither of these purely fiscal policies has had much of an impact.

In April, Bernanke held the first press conference ever by a U.S. Fed chairman. Then in August the Fed broke from its long-standing tradition of avoiding specific timelines by announcing it would keep interest rates at their current low levels until at least mid-2013. Each of these two transparency moves was intended to open up the Fed process and reduce uncertainty.

“I think the secrecy of the Fed hasn’t worked, especially in this past financial market,” said Mark Williams, a former Federal Reserve Bank examiner and a finance lecturer at Boston University.

Williams takes a less benevolent view of Bernanke’s transparency strategy, arguing that the Fed chairman seems determined to put the Fed back in control of the fiscal steering wheel.

The Fed has been dragged “kicking and screaming” to its new policy of openness, Williams said, pushed by markets that have grown skeptical of the Fed’s ability to influence the sluggish economy.

“Over the last 3½ years the markets haven’t been pleased with how central banks have handled financial crisis,” said Williams, citing both rounds of quantitative easing, the two programs in which the Fed bought massive quantities of government bonds.

“The Fed has become reactionary,” he said. “Instead of the market reacting to the Fed, the Fed has been reacting to the market. Bernanke wants to get back in control. It’s a perception game, a PR campaign.”

By releasing interest rate projections, the Fed is trying to get out ahead of the markets, Williams explained. In any case, Williams said he generally applauds the effort.

“Markets work best when they have timely, accurate and transparent information. The Fed is coming into the 21st century kicking and screaming, but at least it’s making the attempt,” he said.

Read more: http://trade.cc/wju#ixzz1inU6d64z

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Romney Up Big in N.H. as Lead Widens, Polls Show

By Steven Shepard

Updated: January 7, 2012 | 9:36 a.m.
January 6, 2012 | 6:44 p.m.

 Former Massachusetts Gov. Mitt Romney has a commanding lead in the Jan. 10 New Hampshire Republican primary, according to three new polls released Friday that show Romney could become the first nonincumbent to sweep the first two GOP nominating contests in the modern campaign calendar.

The three polls all show Romney—who currently holds a slender lead in Iowa—blowing out the competition next week in his adopted home state, while former Sen. Rick Santorum, R-Pa., has received only a modest bump following his surprising surge to a virtual tie for first place in Iowa on Tuesday. Rep. Ron Paul, R-Texas, is in second place in each of the three surveys, while former House Speaker Newt Gingrich is fading. Former Utah Gov. Jon Huntsman, who is staking his entire primary campaign on a strong performance in the Granite State, trails badly in each of the polls.

  • Suffolk University in Boston, which has been conducting a two-day tracking poll for Boston-based WHDH-TV since Dec. 30, released its first poll conducted entirely after the Iowa caucuses. The latest results—compiled from interviews with likely primary voters on Wednesday and Thursday—show Romney leading Paul, 40 percent to 17 percent. Santorum runs third, at 11 percent, while Gingrich is fourth, at 9 percent. Huntsman is at 8 percent, and Texas Gov. Rick Perry earns just 1 percent of the vote.
  • The University of New Hampshire Survey Center conducted a poll for WMUR-TV in Manchester, N.H., from Monday through Thursday. In the full poll, Romney led Paul, 44 percent to 20 percent, with Gingrich and Santorum tied at 8 percent. Huntsman is at 7 percent. But UNH also provided results for the last two days of the poll, following Iowa: Romney leads with 43 percent, followed by Paul (18 percent), Santorum (11 percent), Gingrich (9 percent), and Huntsman (7 percent).
  • A new NBC News/Marist poll, conducted on Wednesday and Thursday, shows Romney leading Paul, 42 percent to 22 percent. Santorum jumped to third place, with 13 percent, followed by Gingrich and Huntsman, each at 9 percent.

As in Iowa and other states, the New Hampshire polls show a significant drop in Gingrich’s support. In the NBC News/Marist poll, Gingrich has plummeted 15 points since late November, arguably the peak of his candidacy.

The polls also show the breadth of Romney’s lead. He leads across genders, among most age groups (Paul leads among those voters 18-34 in the UNH poll but not the Suffolk poll), and among those voters who identify with the tea party and those who do not.

The UNH poll crosstabs also break out the horse race by religion, and the poll shows that Santorum has not yet made significant inroads with Catholic voters, who made up 38 percent of the 2008 primary electorate. Santorum captures the vote of 10 percent of Protestants, and just 9 percent of Catholics.

Campaigning in Tilton, N.H., Romney sounded a note of caution about the results.

“I know some pollsters say I’m doing real well. Let me tell you, those polls, they can just disappear overnight,” he said. “What you say to a pollster is a bit like going on a date. It’s like well, I might try this but you know, getting married, that’s something else. So we need to make sure you’re working real hard and I’ll keep working real hard.”

Meanwhile, President Obama continues to face tough sledding in the Granite State. Just 40 percent of all New Hampshire registered voters approve of the job he is doing as president, according to the poll, equal to his poor approval rating in late November. Nearly half of voters—49 percent—disapprove of Obama’s job performance.

The Suffolk University poll surveyed 500 likely primary voters, for a margin of error of plus or minus 4.4 percentage points.

The UNH poll surveyed 631 likely primary voters, for a margin of error of plus or minus 3.9 percentage points. That includes 318 interviews conducted after the Iowa caucuses; those results have a margin of error of plus or minus 5.5 percentage points.

The NBC News/Marist was conducted by Marist College in Poughkeepsie, N.Y. The poll surveyed 2,263 registered voters, for a margin of error of plus or minus 2.1 percentage points. There were 711 likely GOP primary voters, for a margin of error of plus or minus 3.7 percentage points.

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Wall St. Gurus Find Prediction Game Getting Harder

By Joseph A. Giannone and Jessica Toonkel

NEW YORK (Reuters) – With every new year comes a new round of bold predictions for financial markets.

Bill Gross, the manager of the world’s largest bond fund, kicked off the year calling the current market “paranormal.” He forecast a 2012 characterized by “credit and zero-bound interest rate risk.

Blackstone (BX.N: Quote) Vice Chairman Byron Wien, among the securities industry’s best known prognosticators, on Tuesday unveiled his latest crop of 10 “surprises” for the coming year. BlackRock (BLK.N: Quote) Vice Chairman Bob Doll is bullish on stocks, while one well-known forecaster declared 2012 too hard to predict and declined to offer a forecast.

Among some predictions: Doll foresees double-digit U.S. stock returns, while Wien sees benchmark oil prices plunging to $65 a barrel.

In the past — before U.S. housing prices fell and kept falling for the first time since the Depression or the future of Eurozone was at risk — their educated guesses had a good chance of being right.

But these days, market volatility is the norm and far-flung political events can send U.S. markets into a tailspin. Skeptics contend it is hard to predict what the world will look like tomorrow, let alone 12 months from now.

Indeed, that led Birinyi Associates’ Laszlo Birinyi, whose stock market forecasts were widely followed, to tell clients this month that he would not be making predictions this year.

“There are too many variables which are beyond our comprehension,” he wrote in his January client newsletter.

Read the rest here.

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Global Economy Could Endure Disaster For Only a Week

The global economy could withstand widespread disruption from a natural disaster or attack by militants for only a week as governments and businesses are not sufficiently prepared to deal with unexpected events, a report by a respected think-tank said.

Events such as the 2010 volcanic ash cloud, which grounded flights in Europe, Japan’s earthquake and tsunami and Thailand’s floods last year, have showed that key sectors and businesses can be severely affected if disruption to production or transport goes on for more than a week.

“One week seems to be the maximum tolerance of the ‘just-in-time’ global economy,” said the report by Chatham House, the London-based policy institute for international affairs.

The current fragile state of the world’s economy leaves it particularly vulnerable to unforeseen shocks. Up to 30 percent of developed countries’ gross domestic product could be directly threatened by crises, especially in the manufacturing and tourism sectors, according to the think-tank.

It is estimated that the 2003 outbreak of severe acute respiratory syndrome (SARS) in Asia cost businesses $60 billion, or about 2 percent of east Asian GDP, the report said.

After the Japanese tsunami and nuclear crisis in March last year, global industrial production declined by 1.1 percent the following month, according to the World Bank.

The 2010 volcanic ash cloud cost the European Union 5-10 billion euros and pushed some airlines and travel companies to the verge of bankruptcy.

“I would like to think we can learn from those experiences and be more resilient for longer but it won’t happen unless governments and businesses are better prepared and put in place different supply chains which can be relied on when disasters strike,” said Alyson Warhurst, chief executive of UK-based risk analysis company Maplecroft.

Read the rest here.

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Amanda Carey: Green Movement Dead in the Water

via the Global Warming Policy Foundation

Friday, 06 January 2012 09:12 Amanda Carey, Capital Research Center

A careful look at the history of environmental activism shows how the movement has been unravelling. Now it seems to be dead in the water.

In 2012, three years into President Barack Obama’s first term, green activists are asking, “What went wrong?” Where are all the new laws and regulations regulating energy use and the natural resource production? Where are the public-private partnerships signalling a new era of enironmentalist problem-solving? Where’s Al Gore? Shouldn’t he be lurking over President Obama’s shoulder, smiling, as the President signs yet another green jobs bill into law?

The question is a good one but one not easily answered. In the decades since the birth of the environmental movement, something’s clearly gone wrong. Other movements pushing for political and social change have altered the national discussion and elected candidates at every level of government.

Look at the Tea Party. Born only in 2009, it’s pushed back against the agenda of Barack Obama and congressional Democrats, forcing Congress to heel and almost sending the federal government into default.

But the environmental movement seems dead in the water.

Environmentalism Fails: Legislation

In late 2010 Al Gore offered three reasons why the U.S. Senate failed to enact into law a cap-and-trade bill: Republican partisanship, the recession, and the influence of special interests. He had a point. Despite endorsements from such Republican senators as John Warner, John McCain and Lindsay Graham, every effort to pass comprehensive climate change legislation during the preceding five years had floundered in the Senate.

In 2007 Connecticut senator Joseph Lieberman (Independent) and Virginia Republican John Warner introduced a cap-and trade bill called the Climate Security Act. Their Lieberman-Warner bill was approved by the Senate Environment and Public Works (EPW) committee and sent to the floor by the committee chairman, Barbara Boxer of California. The bill’s advocates said “prompt, decisive action is critical, since global warming pollutants can persist in the atmosphere for more than a century.”

The Lieberman-Warner bill aimed to cap greenhouse gas emissions, lowering emission levels each year until 2050, when emissions were supposed to be down to 63 percent below 2005 levels. To achieve that goal, the federal government would issue right-to-emit permits to electric utilities and plants in the transportation and manufacturing industries. The bill also provided financial incentives to companies and families to reduce emissions.

The bill was doomed. Full Senate debate took place in the summer of 2008, when the average price of gasoline was well above $4 per gallon. Republican opponents successfully labeled it the biggest tax hike in history, one that imposed an enormous tax and regulatory burden on industries that would pass the cost burden onto consumers already struggling to pay for gasoline at the pump.

Republicans beat the 2007 climate change bill because they argued that it would raise gas and home heating prices, cost jobs and cripple the economy. It didn’t help that 31,000 scientists rejected the notion of man-made global warming in a letter signed and circulated two weeks before the start of the Senate debate.

The next attempt came in the summer of 2009. On June 26, the House of Representatives passed the American Clean Energy and Security Act, otherwise known as Waxman-Markey after its authors, Democratic Reps. Henry Waxman of California and Edward Markey of Massachusetts. For the first time a chamber of Congress passed a law meant to curb carbon emissions linked to climate change. Yet the Senate once again refused to follow through.

The Senate version of Waxman-Markey was shepherded by Democratic Sen. John Kerry of Massachusetts, South Carolina Republican Lindsey Graham, and Connecticut Independent Joseph Lieberman. (Sen. Warner did not seek reelection in 2008.) Once again, a complex and messy mix of partisan politics, constituent pressures, and special interests combined to thwart passage of the bill.

Even though the Senate was controlled by Democrats, the sponsors of the bill knew they needed Republican votes, which required that certain bill provisions would have to be modified or weakened. But every tweak of the legislation designed to placate a Republican risked losing a Democrat, and every Democrat lost meant finding another Republican.

Kerry, Lieberman and Graham began bargaining with lawmakers. Some Republicans wanted guarantees that the bill would subsidize nuclear power. Lawmakers catering to agricultural interests wanted incentives or offsets for farmers who would be required to purchase emissions-reducing equipment.

Gulf Coast state politicians wanted to protect off-shore oil drilling, and politicians from Kentucky, West Virginia, and Ohio refused to discuss anything that put restrictions on coal plants, which cap-and-trade does by definition. Every special interest had its own demands. For instance, the powerful Edison Electric Institute, which represents shareholder-owned electric power companies, wanted guarantees that carbon costs would never rise above a certain point. To cushion the blow of higher energy costs, it proposed that through the year 2030 electric power companies receive free emission credits worth billions of dollars.

The White House proposed a “grand bargain”: expand off-shore oil drilling in return for lawmaker support for cap and trade. But the timing couldn’t have been worse. A short time later an oil rig exploded into flames and the Deepwater Horizon well started gushing thousands of gallons of crude oil into the Gulf of Mexico. Under pressure from Senate Republican colleagues and his South Carolina constituents and suspicious of White House double-dealing, Senator Graham pulled his name from the bill, which eventually died without coming up for a vote.

Envirionmentalism’s Bright Beginnings Turn Pale

The sputtering of the environmental movement and the ignominious collapse of its signature legislation could not have been predicted. But a careful look at the history of environmental activism shows how the movement has been unravelling.

Like the civil rights and antiwar movements, environmentalism’s origins lay in the 1960’s. In June of 1969, the Cuyahoga River in Cleveland, Ohio burst into flames. Toxic waste had so befouled the water that it ignited.

Only six months earlier the nation witnessed a massive oil spill off the coast of Santa Barbara, California, the third largest oil spill in American waters after the 2010 Deepwater Horizon and 1989 Exxon Valdez spills. The imagery of burning rivers and miles of polluted beaches provoked public outrage and photos of dying sea birds covered in oily muck became a staple of nightly news coverage.

Highly visual incidents like the Santa Barbara oil spill and the burning Cuyahoga River didn’t create the modern environmental movement, but they were catalysts that thrust it into public awareness. Earlier, Rachel Carson’s 1962 book Silent Spring had claimed that man-made chemical pesticides like DDT were killing birds and other wildlife, and issues like air pollution and toxic waste aroused public anxiety. Groups like Get Oil Out! (GOO) and the Environmental Defense Center were created in the 1960s, and in 1972 California voters approved a ballot initiative creating the California Coastal Commission with vast powers to regulate economic activities and land use along the state’s coastline.

In April 1970 the first Earth Day was proclaimed by city mayors and celebrated on college campuses. Green activists established radical nonprofits like Friends of the Earth (1969), the Natural Resources Defense Council (1970) and Greenpeace (1971) which challenged older conservation groups to become more aggressive in lobbying politicians and harrassing corporations.

At the federal level President Richard Nixon created the Environmental Protection Agency (EPA) by executive order in 1970, and in that same year Congress authorized amendments to the Clean Air Act (passed in 1963) that imposed new regulations, the first of their kind, on industrial and mobile sources of air pollutants. The Clean Water Act (1972) and Endangered Species Act (1973) followed.

By the late 1970s environmentalists were trying to maintain their early successes, but the movement was increasingly institutionalized and bureaucratized. Most groups were headquartered in Washington, DC, where they spent their energies in fundraising and adapting to political pressures. The Carter administration created a Department of Energy and mandated corporate average fuel economy (CAFE) standards to make cars more fuel-efficient. President Carter tried to set an example by wearing sweaters and installing solar panels on the roof of the White House, but most Americans did not like being told to lower their thermostats and buy smaller cars.

In the 1980s and 90s environmentalism began to lose its glamour and popular appeal. Ronald Reagan put energy policy on the back burner when he became president in 1981 and he tried with limited success to emphasize deregulatory policies. Federal agencies were embroiled in constant litigation and controversy whenever they tried to limit environmental rulemaking. A new set of difficult and often unpopular issues-the ozone hole, global warming and population growth-crowded onto the environmentalist agenda.

The War on Terror dominated the public agenda during the presidency of George W. Bush despite efforts by Al Gore and others to focus public attention on global warming. Gore’s 2006 documentary “An Inconvenient Truth” and his efforts to attribute Hurricane Katrina, melting ice caps and summer heat waves to man-made climate change failed to generate the crisis atmosphere needed to achieve social and political change.

These days surveys show Americans worry most about the issues of war and the economy. The environment is far down on the list of concerns. In 2010 a Gallup survey reported that 48 percent of respondents believed the threat of global warming is exaggerated.

Public skepticism has been growing steadily since 2006 when the Gallup poll first reported that 30 percent of those surveyed had doubts about global warming. (The figures increased to 33 percent in 2007, 35 percent in 2008 and 41 percent in 2009.) Similar results were recorded in a March 2011 Gallup poll that asked, “How much do you personally worry about global warming?” Only 51 percent said they worried a great deal or a fair amount, a big drop from the 66 percent in 2008 who were troubled by thoughts of melting glaciers and rising sea levels.

Another indicator of waning public interest in environmental issues is a 2011 Rasmussen poll that asked likely U.S. voters to consider what played a bigger role in global warming: solar activity or human behavior? Sixty percent said it was at least somewhat likely that solar activity plays a role in long-term climate change. Only 22 percent said it was unlikely. This gives no comfort to environmentalists like Al Gore who argue that human activity is the number-one cause.

The Movement Runs Out of Gas

Americans’ interest in taking action against global warming is waning, but environmental groups insist that public opinion plays no role in explaining Congress’s failure to enact comprehensive climate change legislation. Instead, green groups attribute the failure to achieve their goals to the money and power of their opponents. According to their reckoning, environmental groups are stymied by what amounts to a conspiracy of the oil industry, global warming deniers, and the Koch brothers’ vast right-wing network.

In the summer of 2011, Dr. Matthew Nisbet of American University released a pioneering 80-page report, which undermines this argument. Nisbet’s report, “Climate Shift: Clear Vision for the Next Decade of Public Debate,” rejects the argument that the environmental movement has been outspent by right-wing donors like the Koch brothers. It says the data is inconclusive on how much supporters and opponents of a cap-and-trade bill are spending to affect the outcome. For instance, Nisbet compared the budgets of the conservative movement (think tanks, advocacy groups and industry associations) to national environmental organizations. He found that in 2009, major conservative outlets took in a total of $907 million in revenue, and spent $787 million. By comparison, green groups took in $1.7 billion that year and spent $1.4 billion. Another $394 million went specifically to climate-change related programs.

Nisbet also looked at lobbying. In the aggregate, conservatives spent a bit more: $272 million vs. $229 million. But in election spending, they far outspent environmentalists in 2010. For instance, the U.S. Chamber of Commerce spent $33 million, the Karl Rove-advised American Crossroads spent $22 million and its affiliated Crossroads GPS spent $17 million in political contributions. By contrast, the League of Conservation Voters spent $5.5 million, Defenders of Wildlife spent $1 million and the Sierra Club only $700,000.

However, state ballot initiatives tell a different story. California’s Proposition 23 is a case in point. The 2010 initiative, heavily funded by Texas-based oil companies, would have halted California regulations on greenhouse gas emissions until there was a decline in the state’s rate of unemployment. Supporters of the measure raised about $10.6 million. But opponents raised $25 million, with significiant sums from environmental groups. The National Wildlife Foundation reported spending $3 million, the National Resources Defense Council $1.67 million, and the League of Conservation Voters $1.1 million.

Nisbet also looked at foundation funding for climate change projects. What he found confirmed a 2007 study, “Design to Win: Philanthropy’s Role in the Fight Against Global Warming,” which noted that philanthropists are strategic funders of environmental causes and seek to achieve specific policy goals.

It’s clear that overall, the environmental movement does not have a money problem. So what’s the problem? One prominent environmentalist, Daniel J. Weiss of Center for American Progress Action Fund, argues that the recession has played an outsized role in thwarting environmental goals. “It makes people more sensitive to the argument that various proposals will cost jobs,” says Weiss. “Oil and coal industries have made these arguments every timebut they’re falling on more receptive ears now.”

Tom Borelli, a climate-change skeptic at the National Center for Public Policy Research, agrees that a weak economy explains environmentalism’s downward spiral. “All along they were riding the wealth of our nation,” says Borelli. “Now the whole green bubble is exploding.” He points out that the movement’s energy agenda-the war on fossil fuels and the push for renewable energy-have always been unsustainable. “That’s where they failed.”

No One to Blame But Itself

But there’s yet another reason, one that activists are loathe to acknowledge, and it’s this: Their scare tactics have backfired. Environmental groups have done nothing but create enemies by labeling as “global warming deniers” anyone who dares to ask questions about man-made climate change. Critics like Sen. James Inhofe of Oklahoma, who in 2005 called global warming the “greatest hoax ever perpetrated on the American people,” remain a minority in Congress.

Far more typical is Iowa Sen. Chuck Grassley, who in 2009 said, “The scientific aspect that I’m still reserving judgment on is the extent to which it’s manmade or natural.” Pennsylvania Sen. Pat Toomey actually agrees the data is “pretty clear” that there has been an increase in the earth’s surface temperature, but he adds that “the extent to which that has been caused by human activity I think is not clear. I think that is very much disputed and has been debated.”

Extremist rhetoric has badly damaged the environmentalist cause. The Danish environmental writer Bjorn Lomborg and two enlightened environmentalists at the Breakthrough Institute, Ted Nordhaus and Michael Shellenberger, put the blame squarely on the environmental movement. It has no one to blame but itself.

In his latest book, Cool It: The Skeptical Environmentalist’s Guide to Global Warming, Lomborg observes that that there are more important scientific problems to tackle than global warming. Activists should work to provide clean water and address public health issues around the world. By calling for government mandates costing billions of dollars in an implausible attempt to lower the earth’s temperature Lomborg says environmental activists are squandering the public’s goodwill and exhausting its patience.

Ted Nordhaus and Michael Shellenberger urged environmentalists to abandon their doomsday fantasies in “The Death of Environmentalism,” a 2004 paper they wrote for the Environmental Grantmakers Association. It made them outcasts in the environmental movement. Last February, in a speech at Yale University, they revisited the paper and concluded that the problems they identified had only worsened in the years since.

Nordhous and Shellenberger said that when Al Gore attacks Republicans for waging a war on science and calls on Americans to “change the way we live our lives,” he is undermining the public’s “need to maintain a positive view of the existing social order” and guaranteeing that millions of Americans will reject his counsel.

Greens reacted to these developments not by toning down their rhetoric or reconsidering their agenda in a manner that might be more palatable to their opponents. Instead, they made ever more apocalyptic claims about global warming claims that were increasingly inconsistent, ironically, with the scientific consensus whose mantle greens claimed.

In 2012, it’s clear that scare tactics and apocalyptic predictions have failed to persuade. The environmental movement is not gaining traction with either legislators or the public. As Tom Borelli puts it, “They’re now going to be playing defense. And they’re not used to that.”

Amanda Carey is a Washington, DC-based journalist and a frequent contributor to Green Watch.

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BELIEVE IT: All of the ‘December Surprise’ Employment Gains were Seasonal

Looks like the online shopping business has provided a large seasonal boost to the employment survey.

Employment in transportation and warehousing rose sharply in December (+50,000). Almost all of the gain occurred in the couriers and messengers industry (+42,000); seasonal hiring was particularly strong in December. [Emphasis mine]

Full BLS report is here.

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SURPRISE: Middle Class Held-Back by Gov’t Distorted Healthcare, Not Income Inequality

Increasing inequality in the distribution of earnings has become one of those stylized facts that everyone “knows.” The nightly news reminds viewers that ordinary workers have not fared well in the labor market over the last 25 years, while corporate executives have. Many professional economists and a recent CBO report have supported this view as well. While it is true that the cash explicitly paid to employees has become more unequal over the last generation, the…more benign explanation for the change in cash compensation over a generation is the dramatic increase in health insurance costs. …inequality in total compensation has not increased because the fixed costs of health insurance are a much larger percentage of the total compensation of lower-earnings workers. Burkhauser and Simon explore this explanation. They add the value of employer-provided health insurance as well as Medicaid and Medicare to the pre-tax, post-cash-transfer household income data and find that the bottom three income deciles actually exhibit higher growth than the top seven deciles from 1995 to 2008. …Warshawsky makes a similar discovery. Using unpublished BLS total compensation data, including employer health insurance expenditures, from 1999 to 2006, he finds that the growth in compensation by earnings decile (from the 30th to the 99th) averages 35 percent, with 41 percent growth at the 30th percentile (workers earning $10–$14 an hour) and only 35.8 percent growth at the 99th percentile (workers earning $59–$80 an hour).

Translating all this into simple English, it turns out that the rich are getting richer slower than the rest of us are getting richer.

Read the rest here.

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52 Week Highs and Lows

NYSE

New Highs 36 

COMPANY                       SYMBOL      HIGH                VOLUME 
-------                       ------      ----                ------ 
Atlas Pipeline Partners       APL         39.31               35,735 
BlkRk Muni NY Inter Dur       MNE         14.64                  447 
BlackRock  Muni Bnd           BIE         15.41                3,193 
BlackRock Mun Inco            BBF         14.33                1,918 
BlkRk MuniHldgs CA Qlty       MUC         15.15               12,484 
BlkRk MuniHldgs Quality       MUS         14.22                3,122 
BlkRk MuniYield               MYD         14.96                8,170 
BlRk Muyld NY Qlty            MYN         14.20               10,704 
BlRkMunyldQltyIII             MYI         14.51               26,668 
BlackRock NJ Municipal Tr     BNJ         15.76                1,176 
Chesapeake Granite Wash       CHKR        24.50               50,401 
CoreSite Realty               COR         18.58               11,781 
6.375% CorTS IBM              HZK         28.29                  645 
Enterprise Pdts Partners      EPD         48.18              151,937 
First Tr Engy Infr Fd         FIF         21.26                7,180 
Flaherty & Crumrine           PFD         14.48                  934 
Hlth Cr REIT 7.625% F         HCNpF       26.29                  660 
Humana Inc                    HUM         92.58              149,059 
Inv CA Ins Tr                 IIC         15.37                3,849 
Invesco InsCa                 ICS         14.52                  234 
Kansas City Southern          KSU         70.63               77,757 
Macy's Inc                    M           34.22            1,005,275 
Nuveen Enhncd Mun Val Fd      NEV         14.59                9,097 
Nuveen Insured CA Muni 2      NCL         15.88                4,338 
Nuveen MD Premium Income      NMY         15.22                  300 
Nuveen NY Div Fnd             NAN         14.45                1,525 
Nuveen NY Performnce Plus     NNP         15.58                3,820 
Pimco Calif Fund              PCQ         13.63                5,779 
PIMCO CA                      PZC         9.95                 5,642 
Pimco Muni Inc II             PML         11.50               12,981 
PIMCO Muni Inc III            PMX         11.35               10,400 
PPLUS  6.25%  Sers CMT-1      PYJ         27.25                6,892 
Provident Energy              PVX         10.05              162,569 
Roper Indus                   ROP         90.00               85,207 
Western Gas Partners LP       WES         42.53               25,333 
Williams Ptnrs un             WPZ         62.98               36,761 

New Lows 9 

COMPANY                       SYMBOL      LOW                 VOLUME 
-------                       ------      ----                ------ 
Advantest Corp ADS            ATE         9.12                   512 
Cellcom Israel                CEL         15.41               81,805 
Christopher & Banks           CBK         2.04                15,156 
Feihe International           ADY         2.43                11,200 
France Telecom                FTE         14.93              308,248 
SK Telecom                    SKM         13.27              328,520 
Skechers                      SKX         11.61              148,246 
Syswin ADS                    SYSW        0.80                31,800 
Telefonica                    TEF         16.53              923,703

NASDAQ

New Highs 20 

COMPANY                       SYMBOL      HIGH                VOLUME 
-------                       ------      ----                ------ 
Analysts Intl                 ANLY        6.15                 5,259 
Apollo Grp  (Cl A)            APOL        56.70            1,637,513 
BioMarin Pharmaceutical       BMRN        36.11               89,008 
Cintas                        CTAS        36.66               88,145 
Citizens Republic Bancorp     CRBC        12.48               33,910 
Clovis Oncology               CLVS        15.00                2,100 
Cognex                        CGNX        37.90               16,541 
DXP Enterprises               DXPE        35.34                9,969 
Fastenal Co                   FAST        45.28              173,899 
Marine Petroleum Tr Un        MARPS       25.75                  100 
McGrath RentCorp              MGRC        31.13                2,136 
Mid-Con Engy Ptrs L.P. Un     MCEP        19.00                9,400 
NewsCorp A                    NWSA        18.66            2,076,402 
Provident Fincl Hldgs         PROV        9.50                   378 
Ross Stores                   ROST        50.69              338,942 
SLM 6.00% Sr. Nts 2043        JSM         20.39                3,157 
Smith & Wesson Hldg           SWHC        4.75               179,788 
United-Guardian               UG          15.67                  299 
ViroPharma                    VPHM        29.10              434,883 
Zumiez                        ZUMZ        31.23              139,634 

New Lows 19 

COMPANY                       SYMBOL      LOW                 VOLUME 
-------                       ------      ----                ------ 
BMC Software                  BMC         31.93              772,666 
BioMimetic Therapeutics       BMTI        2.09                61,987 
CME Group Inc.                CME         229.53             311,685 
Durect                        DRRX        0.74             1,056,164 
Horizon Pharma                HZNP        3.81                   900 
Integra LifeSci Hldgs         IART        26.00              560,458 
Marchex   (Cl B)              MCHX        5.46                29,522 
NCI                           NCIT        10.50                3,915 
Orchard Supply Hardware A     OSH         15.76               22,034 
Overstockcom                  OSTK        7.01                11,437 
PwrShrs MENA Frnt Cntries     PMNA        10.06                3,689 
ProShr Ul Sh QQQ              SQQQ        17.82              334,767 
RF Micro Devices              RFMD        4.50            11,969,878 
RRSat Global Comm Network     RRST        3.50                 2,555 
Rue21 Inc                     RUE         20.07               19,851 
School Specialty              SCHS        2.18                12,022 
SeaChange Intl                SEAC        6.69                54,319 
Stereotaxis                   STXS        0.76                20,599 
Zynga                         ZNGA        8.65             2,248,885

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Money Flows, Heat Map, & S&P A/D Line

Money Flows

ISSUE GAINERS                 SYMBOL   EXCH   LAST PRICE   MONEY FLOW    RATIO 
                                                          (in millions) 
Apple                          AAPL    NASD      419.98       +46.1       1.15 
iShrs S&P 100                  OEF     ARCA       58.00       +16.9      21.83 
Citigroup                      C       NYSE       28.43       +14.0       1.33 
Johnson & Johnson              JNJ     NYSE       64.75       +13.9       1.87 
iShrs Russell 1000 Value       IWD     ARCA       64.38       +13.2       4.34 
Pfizer                         PFE     NYSE       21.65       +12.5       2.88 
iShrs MSCI Emerg Mkts          EEM     ARCA       38.27       +11.6       1.95 
ExxonMobil                     XOM     NYSE       85.46       +11.1       1.69 
American Tower REIT            AMT     NYSE       60.20       +10.8       3.03 
AT&T                           T       NYSE       29.76       +10.8       1.61 
iShs iBX $ High Yld Cp Bd      HYG     ARCA       88.95       +10.7       5.44 
Dyn Leisure & Entrtnmnt        PEJ     ARCA       18.74        +7.2      70.89 
JPMorgan Chase                 JPM     NYSE       35.27        +7.0       1.29 
iPath GS Crude Oil TR ETN      OIL     ARCA       25.69        +7.0      21.23 
Estee Lauder                   EL      NYSE      112.16        +6.9       5.18 
Chevron                        CVX     NYSE      108.58        +6.5       1.40 
Kraft Foods                    KFT     NYSE       37.61        +6.5       2.14 
Target Corp                    TGT     NYSE       48.68        +6.4       1.39 
Sel Sec SPDR-Cnsme Disc        XLY     ARCA       39.85        +6.2       6.19 
Amazoncom                      AMZN    NASD      180.82        +6.0       1.12 

ISSUE DECLINERS               SYMBOL   EXCH   LAST PRICE   MONEY FLOW    RATIO 
                                                          (in millions) 
SPDR S&P 500                   SPY     ARCA      127.33       -40.8       0.86 
General Electric               GE      NYSE       18.65       -15.6       0.54 
Wells Fargo                    WFC     NYSE       28.56       -15.6       0.49 
Disney                         DIS     NYSE       39.57       -13.9       0.36 
SPDR Gold Tr                   GLD     ARCA      157.35       -13.4       0.84 
Intel                          INTC    NASD       25.06       -12.9       0.53 
DuPont                         DD      NYSE       46.07       -12.8       0.55 
Procter & Gamble               PG      NYSE       66.22       -11.5       0.38 
Microsoft                      MSFT    NASD       27.65       -10.6       0.75 
Philip Morris Intl             PM      NYSE       77.18       -10.0       0.56 
Verizon Communications         VZ      NYSE       38.26        -9.6       0.50 
IBM                            IBM     NYSE      183.19        -8.7       0.75 
Rydex S&P Equal Weight         RSP     ARCA       46.88        -8.6       0.06 
SuccessFactors                 SFSF    NYSE       39.82        -8.1       0.08 
PwrShrs QQQ Tr Series 1        QQQ     NASD       57.43        -8.0       0.69 
PepsiCo                        PEP     NYSE       65.64        -7.2       0.42 
Intuitive Surgical             ISRG    NASD      464.63        -7.1       0.58 
Wal-Mart Stores                WMT     NYSE       58.97        -7.1       0.51 
Sina                           SINA    NASD       53.91        -6.8       0.68 
McDonald's                     MCD     NYSE      100.04        -6.5       0.69

Heat map

A/D Line 

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Most Active Options Trades

-CALLS- 
OPTION    EXP.DATE       STRIKE PRC.     VOLUME        LAST S/PRC.    NET CHANGE 
BAC        1/6/12           6.0000         191            0.1900      dn 0.1100 
GM        1/21/12          17.5000         181            4.8500      up 0.2000 
AAPL       1/6/12         425.0000         154            0.1000      dn 0.0100 
AAPL       1/6/12         420.0000         150            1.2000      up 0.3600 
GLD       1/21/12         161.0000         150            1.0600      dn 0.1200 
AAPL      1/21/12         425.0000         142            4.5000      up 0.8500 
BAC       2/18/12           7.0000         131            0.1600      dn 0.0300 
YHOO      2/18/12          19.0000         126            0.0700      up 0.0000 
MS        1/21/12          20.0000         103            0.0300      dn 0.0100 
GLD       1/21/12         156.0000         101            3.2500      dn 0.1500 

 -PUTS- 
OPTION    EXP.DATE       STRIKE PRC.     VOLUME        LAST S/PRC.    NET CHANGE 
BAC         1/6/12           6.0000        2531            0.0300      up 0.0200 
BAC        1/21/12           6.0000         201            0.2100      up 0.0500 
BAC        2/18/12           5.5000         171            0.1900      up 0.0200 
AAPL        1/6/12         420.0000         161            1.2700      dn 1.6200 
CHK        1/21/12          24.0000         132            0.8700      dn 0.0400 
GLD         1/6/12         157.0000         120            0.2400      dn 0.2000 
AAPL        1/6/12         415.0000         118            0.1200      dn 0.5300 
GLD        1/21/12         159.0000         103            3.2000      dn 1.4000 
BAC        3/17/12           6.0000          90            0.4800      up 0.0400 
GLD        1/21/12         148.0000          86            0.2100      dn 0.0800 

 -VOLUME- 
   CALLS      PUTS           TOTAL 
   14431     15580           30011
-CALLS- 
OPTION    EXP.DATE       STRIKE PRC.     VOLUME        LAST S/PRC.    NET CHANGE 
WFT        5/19/12          17.0000       10008            1.3000      dn 0.0900 
AAPL        1/6/12         420.0000        2374            1.1900      up 0.3600 
EUO        1/21/12          20.0000        2093            1.1000      up 0.2000 
BAC        2/18/12           8.0000        1435            0.0600      up 0.0100 
MU         4/21/12           7.0000        1260            0.9400      dn 0.0400 
GM         1/21/12          17.5000        1101            4.8500      up 0.2000 
BAC        2/18/12           7.0000         984            0.1600      dn 0.0400 
AAPL       1/21/12         420.0000         955            6.9000      up 0.9700 
SIRI       1/21/12           2.0000         942            0.0800      dn 0.0100 
AAPL        1/6/12         425.0000         915            0.1500      up 0.0000 

 -PUTS- 
OPTION    EXP.DATE       STRIKE PRC.     VOLUME        LAST S/PRC.    NET CHANGE 
BAC         1/6/12           6.0000        2742            0.0200      up 0.0100 
AAPL        1/6/12         420.0000        2084            1.0500      dn 1.7500 
BAC        1/21/12           6.0000        1504            0.2100      up 0.0600 
NFLX        1/6/12          77.5000        1307            0.0600      dn 0.4200 
BBY        1/21/12          22.5000        1120            0.2100      dn 0.2700 
GE         3/17/12          18.0000        1015            0.6600      dn 0.0200 
C          1/21/12          24.0000         856            0.1300      up 0.0300 
AAPL        1/6/12         415.0000         762            0.1000      dn 0.4900 
GLD         1/6/12         157.0000         672            0.4300      up 0.0400 
KOG        1/21/12          10.0000         638            0.4500      up 0.0500 

 -VOLUME- 
 CALLS      PUTS           TOTAL 
276981     215110         492091

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