Da Beers!

Da Beers!

Sunday, June 19, 2016

Has Veresen Duped Labor Unions for Support of Jordan Cove LNG?

For years, Oregon and Washington labor unions have been strident and vocal supporters of the Jordan Cove LNG and Pacific Connector pipeline facility (both when it was to be an import facility (2007-2012) and export facility (2013-present)). They have written letters to FERC. They have lobbied legislators. And they have sent scores of members to public meetings to testify in favor of the projects, and to shout down and bully local residents and impacted landowners who opposed these projects.

Why would the unions care?

The short answer is that union leaders seem to believe they're locked in the get all the construction jobs for their members that will be generated by these enormous construction projects ... and maybe the 150-odd permanent jobs operating the facility as well.

So is that right?

Probably not.

Take the case of the Building and Construction Trades Department of the AFL-CIO National Construction Agreement that “Jordan Cove’s construction contractors Black & Veatch Corporation, Inc. and Kiewit Power Constructors" have entered into.

Several problems here.

First, there seems to be real confusion about the role going forward of Black & Veatch Corporation, Inc. and Kiewit Power Constructors. While the Canadian developer, Veresen Inc., has told the State of Oregon that Black and Veatch, Inc., and Kiewit Corporation are locked in to construct at least the South Dunes Power Plant portion of the project ("The Applicant has selected a consortium of Black and Veatch, Inc., and Kiewit Corporation to construct the SDPP, with Black and Veatch acting as principal designer. EXHIBIT D ORGANIZATIONAL EXPERTISE OAR 345-021-0010(1)(D)"), that's not what Veresen is telling the public.

Rather, local project shill Bob Braddock reported in October 2015 that Jordan Cove still needs an "engineering procurement construction (EPC) contracting agreement." Braddock said Kiewit and Black and Veatch had "carried us through the permitting process." However, in the summer of 2015, Veresen opened up contracting to two additional bidders: international goliaths Bechtel Corporation and Chicago Bridge and Iron (CB&I) (in a consortium with a Japanese firm, Chiyoda). "From that," Braddock reported, "we anticipate that we will select two of those to proceed to give us a full fixed-price ... contract."

So what?

Well, agreements to use union labor under the National Construction Agreement are between a contractor and the union, NOT between Veresen and the unions. And as we've just seen, Veresen hasn't actually selected a building contractor yet.

Moreover, agreements to use union labor under the National Construction Agreement are not binding until construction actually commences. See sec. 24-2 of the National Construction Agreement.

Taken together, Veresen's so-called promise to use AFL-CIO labor under the National Construction Agreement seems awfully ephemeral.

Whether or not that was by design remains to be seen. But if we were betting, we'd bet that before construction starts -- if it ever does -- the unions will find that they're not still dealing with the same consortium of building contractors who signed the National Construction Agreement in 2013.

And even if that's not the case, we strongly suspect that "economic realities" that poor little Veresen will claim they couldn't have possibly foreseen in 2013, will cause Jordan Cove's final consortium of building contractors to renege on the 2013 National Construction Agreement.

Out with the union workers, in with the scabs!

Meanwhile, it will be mighty hard for 'organized labor' (is that now an oxymoron like 'military intelligence'?) to unwind all the strident support they've given to Veresen's schemes over the years, won't it?

The facts and law are slightly different, but the same basic outcome seems likely with respect to the 2013 Project Labor Agreement (PLA) with the Oregon Building and Construction Trades Council, the Pacific Northwest Regional Council of Carpenters, and the International Union of Operating Engineers Local 701.

But, you ask, won't FERC make Veresen live up to its promises to use union labor? After all, the Final EIS (Sep 2015) even mentions that “Jordan Cove has committed to use local and union labor when available for construction of the LNG terminal and related facilities.” FEIS at 4-816.

Not likely. 

FERC staff’s recommendations for issuance of a certificate make no mention of union labor as a condition of approval, or as required project mitigation. See FEIS at section 5.0 “CONCLUSIONS AND RECOMMENDATIONS.” Not a good sign, right?

Moreover, FERC Commissioners have made clear in other cases that they are not concerned with union agreements or commitments a licensee may or may not have made. See, e.g., National Grid plc Docket Nos. EC06-125-000, ORDERAUTHORIZING MERGER AND DISPOSITION OF JURISDICTIONAL FACILITIES AND GRANTINGPETITION FOR DECLARATORY ORDER at paras. 71-77 (October 20, 2006) comm-meet/101906/E-7.pdf (where the Utility Workers Union of America, AFL-CIO and related local unions (UWUA) asked the Commission to require Applicants to identify the collective bargaining agreements that would be honored by Applicants on the ground that identification of the collective bargaining agreements was necessary for UWUA to assess the potential impacts of the proposed acquisition on its members and on service quality, the Commissioners observed that review of collective bargaining agreements was not part of FERC’s analysis).

* * *
So there you have it. When the dust settles, we can reasonably expect disappointment for union workers and their misguided leaders if FERC ever licenses Jordan Cove LNG and the Pacific Connector pipeline.

But that will pale against the deep and long-lasting disappointment of those forward-looking local citizens and landowners who will find their communities destroyed by these massive projects ... projects that these misled labor unions have worked so hard to get approved.

Friday, May 27, 2016

Jordan Cove Bombshell?

26 May 2016 may be destined to go down as a red-letter day in the decade long slog towards final rejection of the Jordan Cove LNG boondoggle.  That's the day the Industrial Energy Consumers of America (IECA) weighed in against the project.

Who or what, you ask, is IECA? 

IECA is a nonpartisan association of leading manufacturing companies with $1.1 trillion in annual revenues, 1.4 million employees and with more than 1000 facilities nationwide.  IECA membership represents a diverse set of industries including: commodity and specialty chemicals, plastics, steel, cement, paper, food processing, fertilizer, glass, pharmaceutical and aluminum.

IECA is recognized in Washington as the “voice of the industrial energy consumer” and testifies on energy and environmental issues before Congress and relevant regulatory agencies more than any other manufacturing based trade association in the country.

In other words, in the world of big-league pro-business lobbying, ICEA is a very big deal.

What's ICEA's beef with Jordan Cove LNG?

ICEA makes a number of nuanced arguments regarding FERC's market and public interest determinations.  But the thrust of ICEA's concern  is that its member energy-intensive trade-exposed (EITE) manufacturing companies which use 75 percent of the natural gas and 73 percent of electricity consumed by the manufacturing sector, would be "negatively impacted if natural gas prices increase as a result of exporting LNG."

Short, sweet, and compelling. Drop the mike.

Hard to say what FERC will do with this, but it feels like a game changer.  Up until now it’s been all calm rational business people on one side. And crazy environmentalists, puny powerless landowners, and little old ladies in crocheted hats on the other. Now FERC will have to deal with the possibility of helping to wreck the entire domestic manufacturing industry if it green-lights this mess. Which is already an economic sector in pretty shaky condition.

Moreover, this seems like the basis for a pretty effective counterargument to all the caterwauling by parochial Oregon labor unionists who seeks short-term construction jobs, and Plains-state gas wellhead owners/frackers who just want to see Asian exports help to drive the price of gas back up domestically.

What now?

I'll say it again.  It's time for Coos Bay to give up on its pipe dreams of a return to 1950s-style "smokestack" jobs, and embrace the 21st Century instead.  Even if those "smokestack" jobs could be a viable economic force again in the U.S. -- they can't -- few American communities are so desperate that they would willingly welcome them back to their communities.

And as others have effectively argued, it seems to be the very threat of the re-industrialization of Coos Bay that's holding us back as the rest of the Pacific Northwest continues to attract well-heeled climate expats, retirees, and members of the "creative class" generally who are, and who will continue to be, the drivers of the American economy in the coming decades.

Crucial to this change will be a sweeping of the decks of the old school political "leaders" like Rep. Caddy McKeown, Sen. Arnie Roblan,  Coos County Comm. Bob Main, and the entire Port board -- all of whom have helped foster this socio-economic nonsense for years.

The necessary change won't happen this year while many of these characters are again running for office unopposed, while the national media once again keeps the citizenry distracted with the much less important (at least locally) presidential horse race.  But until we send to Salem and Coquille smarter people who truly have the best interests of the citizens at heart, we're doomed to continue this losing cycle of bust and bust.

Sunday, April 10, 2016

Jordan Cove LNG: The Other Shoe Drops

After a brief lull in the Jordan Cove storm after FERC unexpectedly denied the project's application on 11 March 2016, the past few weeks have seen a flurry of mostly pro-project advocacy in the form of no less than 41 new letters and testimonials uploaded to the project docket in the month since FERC's denial.

Notwithstanding the constant chant from area shakers and movers that "most" locals support this project -- an assertion that has never been tested by a vote, or even by a publicly-chartered opinion poll -- the vast majority of all this advocacy has come from far outside the geographic area that will be most heavily impacted by this project: the lands and waterways of Coos Bay.

The lion's share of last-minute advocacy has come from the hogs that had been patiently lined up at the trough waiting to get their share of this largest single construction ever proposed for Oregon: trade unions like the International Brotherhood of Boilermakers or Laborers International Union of North America Local 737, and material suppliers like Knife River.

One support letter in particular is a real hoot. It comes from a mining and mineral company, Oregon Resources Corporation, which had staked its future on what it perceived as a global demand for chromite. Being another of those "real jobs" boondoggles that seems to so viscerally appeal to Coos Bay opinion leaders, the scheme of this Australian-owned company was to open a strip mine in opposition to neighboring landowners, then truck 700,000 tons of ore a year to a new $44 million processing plant in Coos Bay. Sound familiar at all? Long story short, this corporate "expert" in global markets laid off 31 employees in 2011, and another 45 just before Christmas in 2012ORC's website still claims they're pursuing the project, but the last local news report was in 2012.

Like the loggers of old who flocked to the Pacific Northwest to mine our forests of ancient giants only to leave behind miles of stumps and monoculture tree farms, modern-day foreign raiders like Oregon Resources Corporation and Veresen would strip what they can from Coos Bay, then go back home leaving behind giant eyesores brimming with explosive or toxic materials.

What's better than making a buck ... and doing it entirely in someone else's back yard?   Especially when those who own the back yard are such willing marks?!

* * *

Considering that FERC denied Jordan Cove LNG's application based on a narrowly-focused balancing of the rights of the many private landowners along the pipeline who would have seen their land condemned, against the purported public benefit that would be derived from this massive project, there were surprisingly few post-denial comments that actually addressed that issue.

In the past month FERC has heard from a number of bona fide landowners in the pipeline's path who remain adamantly opposed to the pipeline project's seizure of their private property.

On the other hand, one couple -- Shirley and Eng Ming Chen of Reno, Nevada -- claimed to own land "impacted by the Pacific Connector Gas Pipeline" and wrote in support of the project. But the Chens failed to note whether or not they've entered into any consensual agreement for the use of their "impacted" property.  Which would be the best way to put their money where their mouths are, no? But then, the Chens don't even explain how this project will have an "impact" on them in Reno.

On the supply end of the pipeline, there are a grand total of two letters from small Colorado oil and gas producers who claim they need the Jordan Cove project to be able to reach lucrative Asian consumers. But neither company says they are even in talks with Veresen or its subsidiaries for the kind of binding tolling agreements FERC said in its denial order it needed to see.

There are no comments in the docket about the need for this project from the consumption end. Although Veresen has crowed in the media that they have tentative agreements with the Japanese trading company ITOCHU, and with a consortium named JERA. Together, these two deals could account for half the project's LNG output capacity for the next 20 years ... if finalized.

* * *

Among the more shocking letters filed with FERC are two from women who currently hold public office: Oregon State Representative Catherine "Caddy" McKeown, and Douglas County Commissioner Susan Morgan. Both letters are on official government letterhead, and in the case of Ms. Morgan's letter FERC staff has even logged it as being from the "Douglas County Board of Commissioners."

A closer reading of these two letters, however, reveals that both women are speaking only for themselves. Although that important fact may be completely lost to the busy FERC commissioners sitting in Washington DC, and who must rely on -- cough cough -- an objective and unbiased FERC staff to present the facts of the case to them.  More on that below.

While some agencies like the Oregon Department of Environmental Quality and the Oregon Department of Energy have served as dutiful lapdogs of the Jordan Cove LNG project, the Oregon Legislature has never voted on, nor taken an official position on the project. Nor has Governor Brown.  Thus, "Caddy" seems to be on her own here.

In the case of the Douglas County Board of Commissioners, the official policy statement is found in an October 2015 letter to FERC -- signed by Commissioner Morgan herself as well -- that took a stand against land condemnation by a private entity, writing: "We request FERC to include a condition in any approval of the Pacific Connector Pipeline through Douglas County that eminent domain not be used and Pacific Connector be required to negotiate with property owners to reach agreement on route, safety and compensation." The commissioners also cited serious safety concerns about the gas pipeline following last year's devastating fire season.

Nowhere in her recent letter of unqualified support does Ms. Morgan mention her fellow county commissioners, or the official edict she and her fellow commissioners issued just last fall.  Likewise, neither does the letter to FERC from "Caddy" McKeown mention that she is not representing the view of her fellow legislators.

So much for Oregon's sunshine laws and public meeting requirements.

* * *

The most shocking letter of all, however, came from within FERC itself. In a letter clearly penned by project environmental project manager Paul Friedman, FERC takes the Oregon State Historic Preservation Office (SHPO) to task for daring to suggest that FERC hasn't done everything legally required to protect cultural and historic resources threatened by the Jordan Cove project.

What's even more shocking than the tone and content of Mr. Friedman's letter to the SHPO, however, is its timing.  15 U.S.C. 717r governs the appeal of FERC's denial of the Jordan Cove and Pacific Connector Pipeline permits.   This statute clearly states that the FERC commissioners' denial in March 2016 was final and binding ... until and unless overturned on appeal by FERC itself, or by a federal appellate court.

So what?  Well, for all practical and legal purposes, the Jordan Cove LNG project is currently dead as a doornail.   But in direct contradiction to his employers' decision, Mr. Friedman has decided to keep working the project as though it's still alive and kicking.

Gee, it must be great to be a mere mid-level civil servant who can decide all on his own to keep expending federal taxpayer dollars on a project his bosses have legally killed off.  And to do it in a way that so thoroughly shows his contempt for cultural resource concerns, and his extreme bias in support of this project!


All this may be a moot point, however.   On 08 April 2016 the applicants filed their appeals in the action.  And on the surface, their work looks complete and compelling.  

In a nutshell, where they could show no suppliers or customers a month ago, the applicants claim to now have preliminary agreements for 77 percent of the pipeline's input capacity, and 50 percent of the proposed LNG output.

Based on these developments the applicants have requested that FERC should grant a rehearing, then they offer three variations on substantive relief:
  • FERC should simply change its mind and grant the applications of JCEP and PCGP outright
  • FERC should grant the applications of JCEP and PCGP, subject to a condition that would prevent the initiation of condemnation proceedings until executed precedent agreements are submitted to FERC staff
  • FERC should stay its 11 March 2016 Order, and re-open the record for six months to receive additional evidence of customer support
If I were betting, my money would be on FERC granting the rehearing, and then opting for Door #2:   Conditioning approval on a showing of executed precedent agreements prior to initiation of the dozens of condemnation actions that will amount to seizure of private property by a foreign corporate power -- regardless of the fact the foreign corporation has cloaked itself in the mantle of Delaware-based domestic businesses.


Of course, Veresen probably had to give away the farm to get these preliminary tolling and offtake agreements.  Both the sellers and buyers knew full well that Veresen was under the gun.  But I'm sure whatever economic hit Veresen took will be absorbed by the shareholders and corporate executives, right?


Veresen, by and through its local toadies, will likely soon be breaking the bad news that all that corporate largess in the form of community enhancement plan -- the terms of which Jordan Cove was already balking at last year -- will have to be cut way back.  

Or more likely ...  after a charade of negotiation, the community enhancement plan will be abandoned altogether now that Veresen has wrung all it needs out of the local yokels.  

Given the destruction this project will likely wreak on local property values, it was probably always Veresen's long game to keep the suckers on the hook with this enhancement plan nonsense, then ultimately take their chances with the Coos County Assessor (the incumbent who, by the way, is in no way involved in any conflict of interest by also serving as an LNG booster Steering Committee member!).  There's nothing to lose, and everything to gain for Veresen's shareholders.


At the end of the day, the people running Coos Bay will eventually wake up to realize they've given away any real economic benefit this project might have provided.  And when the giant LNG tanks and tankers are finally a fixture on the now-scenic bay, you can be pretty sure that anyone who can get out, will get out.  

Once the mass huge out-migration of the educated and monied folken is complete in 5 or 6 years, there will be no more tourists, and no more retirees.  Even those like "Caddy's" family who have dominated local politics and wealth for over a hundred years will likely develop a taste for other pastures.  Especially when the proles finally show up on tony Telegraph Hill with tar and feathers once they figure out how badly they were fleeced.

And those left behind?  They'll see public services and businesses dwindle in ways undreamt of during the last great shakeout following mechanization and offshoring of Oregon's timber industry.

There are, after all, plenty of other pretty Oregon coastal towns that won't feature a gigantic waterfront eyesore, and that won't offer the distinct possibility of being burnt to a crisp by an exploding pipeline, gas tank, or tanker.

You can be pretty sure, however, that those with insider information, and those generally in the know, will make lots of money by shorting Coos Bay ... and by going long on Veresen.

Good luck.  To misquote Bette Davis:  "Fasten your seat belts.  It's going to be a bumpy ride."

Wednesday, March 30, 2016

What's the connection between logging, coal, and Jordan Cove?

Turns out there's a close connection between coal mining in the Appalachians, and logging in the Pacific Northwest.  And those connections in turn tell us a great deal about how a project like Jordan Cove LNG could come to be embraced by many well-meaning folks in the Coos Bay area.


According to a story by Jedediah Purdy for the The Atlantic available at Route Fifty, at its peak in the mid-20th century coal mining employed more than 150,000 people in West Virginia alone, mostly in the state’s otherwise poor and rugged counties.  But now, after decades of mechanization, there are only about twenty thousand coal miners in West Virginia, and another sixteen thousand between Kentucky and Virginia. And the counties in those states with the greatest coal production, also have some of the region’s highest unemployment rates.  

In Appalachia the primary change has been a shift from classical old-school coal mining where humans toiled deep in underground tunnels wearing hardhats and lanterns,  to a strip-mining technology with the Orwellian name "contour mining," or more descriptively termed "mountaintop removal."  

In addition to wreaking widespread and permanent environmental havoc, the new coal mining technology has replaced about 90 percent of the workforce with heavy equipment operators using enormous machinery to effect landscape-scale topographical dysmorphism.


Maybe when Google perfects the self-driving car, the same technology can be adapted to coal mining technology so another 90 percent payroll reduction can be achieved?  It's not hard to imagine an entire West Virginia mountaintop -- yep, there a re a few left -- being leveled by a fleet of machines operated from a control center by a handful of former drone pilots or virtual gamers.


The story in the Pacific Northwest is much of a muchness.  While timber jobs have fallen victim to a number of factors, automation and mechanization in the logging process and in the mills has led to an enormous loss of living-wage jobs all across the West.  

In the Oregon woods, the primary engine of change is the harvester -- a highly specialized machine employed in cut-to-length logging operations for felling, delimbing and bucking trees. Working together with a forwarder that hauls the logs to a roadside landing for truckbed loading, these machines have taken tens of thousands of human workers out of our "working forests."

When you add to mechanization the clear industry preference for exporting whole or chipped logs, it becomes clear why so many rural counties in the Pacific Northwest are caught in a perpetual struggle precipitated by large-scale loss of living-wage jobs and timber revenue cuts.  These in turn exacerbate social ills like chronic un- and under-employment, domestic violence, drug and substance abuse, and property crimes -- all while declining budgets have crippled law enforcement and social services budgets.


Long story short, in both the Pacific Northwest and Appalachia, mechanization and raw materials exports have killed off many of the living-wage jobs that once supported entire communities.

Meanwhile, all those SciFi predictions from the 50s and 60s of everyone being freed up by machines to have lots of leisure time never quite materialized, did they?

That's because the  industries that benefited from automation have never been required to share any of the benefits (profits) of these macroeconomic trends with former laborers.

Fortunately for those who might have had to more equitably share their wealth with displaced workers, there were other major changes going on at the same time as wholesale mechanization and automation.

First, and maybe not coincidentally, the anti-government hatred fostered by right-wingers amongst the least educated — the same folks displaced most often by automation and mechanization — has made it unfashionable to even entertain any political redistribution of wealth to re-balance the equation.

Second — and maybe also not coincidentally — a recent article by Brian S. Feldman for The Atlantic and available at Route 50 on the decline of business in St. Louis describes how wholesale abandonment of anti-monopoly laws by the Reagan-Bush administrations during the 1980s, and extension of those policies by the Clinton  administration in the 1990s, has fundamentally reordered business in the U.S. and globally.  The result?  It is now far less likely that any city or region will thrive that's not host to the new mega-combines that dominate the world's economy now.

Sure, it could help  if we could lure educated “creative class” types to the south coast.  And building an enormous greenhouse-gas belching LNG plant on Coos Bay sure won't help that effort.

But it's not hard to look around us here in coastal Oregon and see how all these political and economic forces have played out to our great disadvantage as the polity has become radically ultra-conservative since the 1980s, as the “creative class” types have fled for more friendly neighborhoods in places like Portland or Seattle, and as the timber industry has consolidated down to a few enormous multi-national firms which wield equally enormous power.


Anyhow, even with far fewer workers, Big Coal and Big Timber are chewing up the American landscape at a record pace. 

And on both coasts these operators have skillfully manipulated poor rural people into believing it was those city-dwelling tree-hugging environmentalists, not anti-labor business practices and high-profit bulk exporting, that killed off their jobs and destroyed their communities.  

Even if you detest the outcome, you really have to admire the chutzpah of people who can pull off that kind of public relations coup.


So what's the connection to Jordan Cove LNG?

Wim de Vriend, a former restaurateur and critic of Coos Bay development projects for more than 30 years, did a pretty good job of laying out the problem in a guest op-ed in the The World in 2015.  Wim relates how Oregon International Port of Coos Bay manager Steve Felkins summed up the attitude of local elites back in 1978. "Coos Bay is not oriented to making you people happy two weeks in August," snarked Felkins as he proclaimed Coos Bay's preference for "real jobs" over tourism jobs.

The Port, aided and abetted by Coos County leadership, made good on that view when it cooked up a plan in 1978 to discourage tourists from using Charleston boat launch facilities.

The Port's arrogance was followed by more failed schemes — mostly focused on "industrial" land the Port owns on the bay's North Spit — to build a garbage-burning plant on the North Spit, a noxious fish waste plant in Charleston, unused commercial docks and slips, a speculative coal export terminal, undersea mining, oil equipment fabrication, a sure-fired toxic mess of a chromium smelter, a large-scale pulp mill that would have suck millions of gallons of water daily out of Tenmile Lake, a steel mill, and a container terminal.

Last but not least came Jordan Cove LNG. A 2008 poll of 100 citizens in each of the four impacted counties — funded by and conducted for the Jordan Cove Energy Project itself — claimed that 56 percent of citizens in Coos, Douglas, Jackson and Klamath counties supported the construction of an LNG terminal at Coos Bay. The biggest reason cited for support was a need for jobs — and presumably not just any jobs, but "real jobs."  And off we all went once again down the "real jobs" primrose path.


Now, Coos Bay is not unique in its hatred of "burger-flipping" jobs, and its dogged quest for a return to a Happy Days reality where dad went off to a well-paying "real job," mom could afford to stay home and keep house, and the perfect kids could look forward to exactly the same lifestyle (only with even better results).

Never mind that in our new Global Economy, and as the hyper-accelerated Chinese capitalist trip has most recently shown, a transition from manufacturing jobs to service jobs is probably inevitable.

The fact is, almost the entire economy of the U.S. went through the same kind of transition starting in the 1980s. The impact was only greater in places like rural Oregon where the economy was so focused on logging.

And then along came automation and mechanization, which took a bad situation, and made it truly awful from a "real jobs" perspective.


What's the answer?

Well, there isn't an easy one.  There never is when reality runs headlong into strongly held, emotional ideals about how things ought to be.  Hence the appeal of a demagogue like Donald Trump who's long on promises to "make America great again," but unsurprisingly short on how to do that (other than suggestions about beating up on the rest of the world).

Meanwhile, here are some ideas.

But while we figure it out, how about if we not destroy this place just to "save" it?

If your kids and grandkids really want to live close to you in Coos Bay, they'll find a way.

And if they don't want to live and die here, no amount of mega-polluting eyesore industrial development is going to make them love it any better, right?


Other Sources: 
State of the World 1991: A Worldwatch Institute Report on Progress Toward a Sustainable Society, edited by Lester R. Brown (W. W. Norton & Company, 1992).

Saturday, March 26, 2016

Lawmakers seek to strip Federal land management agencies of law enforcement authority

Eric Katz with Govexec reports that four Republican lawmakers, all from Utah, want to prohibit federal land management agencies from enforcing the law on the lands over which they have jurisdiction. Instead, the legislators would turn law enforcement responsibilities over to local authorities.

Notwithstanding my disgust for the Crackpot Constitutionalists who took over and tore up Malheur NWR earlier this year, at first blush I could see merit in this idea.  Even if the House authors of the Local Enforcement for Local Lands Act don't really understand the legal issues either.

Shocking, I know!

After all, I too have been concerned about the growth in federal law enforcement ever since people really started getting into cowering under their beds post-9/11.

Now, I'm not referring here to the top-secret world the government created in response to 9/11 -- a world the Washington Post reports is "so large, so unwieldy and so secretive that no one knows how much money it costs, how many people it employs, how many programs exist within it or exactly how many agencies do the same work."

Nor am I talking about the massive build-up in Customs & Border Protection personnel and resources since 9/11.  Despite what the right-wingers claim, the Obama administration has spent billions on the effort.  And, yes, that includes Gestapo-like highway checkpoints many miles from any international border.   

No, we're referring here only to the common garden-variety BLM and USFS sworn law enforcement officers targeted by the Utah delegation.  Which, at least on one level, seems patently offensive given the that the federal government has no more than proprietary jurisdiction over most of it's lands.  It's as if you or I decided we could hire and arm our own private police force to enforce the law on our own homesteads.  Crazy, right? 

Here's the problem though.  The federal government isn't like you or me.  It has special sovereign powers under the Constitution.  So the idea that Congress has sole power to control the occupancy and use of federal lands, and to protect them from trespass and injury, and to prescribe the conditions upon which others may obtain rights in them, even though this may involve the exercise in some measure of what commonly is known as the police power -- whew -- is no Obama socialist power grab.  It has been a matter of well-settled law since at least 1917 when the U.S. Supreme Court decided Utah Power & Light Company v. United States (243 U.S. 389, 405 (1917)).  

At bottom, the fact that the entire Department of the Interior employs about 2,500 sworn law enforcement officers nationwide (only about 250 of those being BLM employees, and most being National Park Rangers), and the U.S. Forest Service employs about 650 sworn law enforcement officers nationwide, is probably no existential threat to our civil liberties.

Those federal officers, are, however, apparently a continuing offense to to the descendants of Mormons who have had a love-hate relationship with the federal government since the 1800s.  

So at the end of the day, it's pobably no coincidence that both the Local Enforcement for Local Lands Act and Utah Power & Light Company v. United States both came out of Utah.  And while I may have continuing concerns about the growth of the American police state, I have to view this latest attempted Constitutional end run for what it really is: sour grapes.

Thursday, March 17, 2016

The Myth of Shareholder Supremacy

This is an oldie but a goodie.

A 2010 article by Loizos Heracleous and Luh Luh Lan in the Harvard Business Review asked the legal question: Why are corporate directors so convinced of their obligation to shareholders that they’d make decisions with damaging social or environmental impacts?

Their research was informed by an earlier Journal of Business Ethics study which showed that in a survey of 34 corporate directors (who each served on an average of six Fortune 200 boards), 31 said they would “cut down a mature forest or release a dangerous, unregulated toxin into the environment in order to increase profits.” These corporate directors believed they were required to do whatever they could legally do to maximize shareholder wealth.

The authors point to the fact business schools still teach a 1919 case from Michigan, Dodge v. Ford Motor, for that view—even though an important 2008 paper by Lynn A. Stout explains that it’s bad law, now largely ignored by the courts.  Moreover, Dodge has been cited in only one decision by Delaware courts in the past 30 years.  And, of course, Delaware is the venue for most corporate litigation.

The authors also pointed out that shareholders do not "own" the corporation, which is an autonomous legal person. What’s more, when directors go against shareholder wishes—even when a loss in value is documented—the courts support the directors most of the time. 

Long story short, there's no commanding legal doctrine that compels environmental or social destruction ... even if that's the most economically profitable choice.

Tuesday, January 26, 2016

Corn-pone Crackpot Constitutionalists

UPDATE 26-Jan-2016:

Ammon and Ryan Bundy, and three of their merry misfits -- Shawna Cox of Utah, Ryan Waylen Payne of Montana, and Brian Cavalier of Nevada -- were arrested today at in a traffic stop in Harney County.

Another miscreant -- reported to be LaVoy Finicum who had emerged as de facto spokesman for these criminals -- was killed when shots were reportedly exchanged.

Peter Santilli of Cincinnati, and Joseph Donald O’Shaughnessy of Cottonwood, Arizona, were arrested later in Burns.  

Remote coward John Eric Ritzheimer turned himself in to police in Peoria, Arizona.  The Oregonian reports that Ritzheimer, 32, a "key militant leader," rose to fame complaining on a video about the delivery of dildos to the refuge in response to pleas for supplies.

Absurdly, the group was reportedly on their way to yet another off-site press opportunity about 70 miles away in John Day, Oregon.  Local media reports that roadblocks had finally been set up to limit access to the occupied wildlife refuge.

I'd like to believe these assholes went out in a final blaze of stupidity -- exercising their rights as "sovereign citizens" to use public highways that they feel no obligation to help pay for.   

The Times reports that these nitwits face a federal felony charge of conspiracy to impede federal officers from discharging their official duties through the use of force, intimidation or threats.  But I could come up with a dozen or more additional charges if the U.S. Attorney needs help.  Call me!

It'll be interesting now to see if the federal government that Ammon Bundy and crew don't "believe in," will have the cajones to prosecute these fools and put them away for a long, long time. 

Now it's time to clean out the rest of the rat's nest at Malheur and call in the CSI and refuge folks to figure out just how much economic damage these fools can be charged for.

From top left, booking photographs of Ammon Bundy, Ryan Bundy, Brian Cavalier and Shawna Cox. From bottom left, Ryan Waylen Payne, Joseph Donald O’Shaughnessy and Peter Santilli. Credit Multnomah County Sheriff

UPDATE 13-Jan-2016:

Nancy Langston, a professor of environmental history at Michigan Technological University, has a great op-ed in the NY Times that walks us through the difficult history of Malheur NWR.  Her conclusion:
When mythic histories supplant the complexities of the past, the results can be lethal. Equitable futures for Western public lands won’t be achieved when ideologues swagger in, brandishing guns and taking over federal buildings. Rather, they develop from the hard work of collaboration, like the 2013 effort that brought together the local community, tribes, conservation groups and the state and federal governments to develop a new management plan for Malheur. These are the efforts that best respect the region’s history while pointing the way to a sustainable future.
Meanwhile, we sincerely hope Billy Williams, the U.S. Attorney for Oregon, is working on indictments for Ammon Bundy and all the other 20-odd fools staffing the barricades in Voltage-Princeton.  These people should be going away for a very long time, and should also be forced to reimburse taxpayers for economic losses -- including the $100,000+ per week in salaries their tomfoolery is costing us.

But we're not holding our breath about that either.   As pointed out by the Public Employees for Environmental Responsibility (PEER), the armed seizure of Malheur National Wildlife Refuge was a foreseeable outcome of the utter lack of a coherent response to earlier confrontations with anti-government extremists.    A July 2014 Homeland Security assessment entitled “Domestic Violent Extremists Pose Increased Threat to Government Officials and Law Enforcement” supports that view, correctly predicting that the “perceived victory” of the Bundy stand-off with BLM in Nevada “is galvanizing some individuals – particularly militia extremists and violent lone offenders – to actively confront law enforcement officials, increasing the likelihood of violence.”  The DHS assessment went on to link the murder of two Las Vegas police officers to this ongoing policy failure.

UPDATE 11-Jan-2016:

Unlike the Bundy-type legally futile efforts to hand federal and back to the "original owners" (which, again, we assume does not mean the Paiute tribes), the New York Times reports on an effort that could achieve real results ... especially if a Republican or Republican-type takes the White House in 2017.   

One of the well-heeled lobbying groups leading this charge is the American Lands Council, and Utah-based group funded by donations from county governments, and by Americans for Prosperity (the group backed by the billionaire Koch brothers).

The American Lands Council is a non-profit organization founded in 2012.  Their mission is to "secure local control of western public lands by transferring federal public lands to willing States."

Sound great, right?  The only problem I can see, based on my years in government service, is that the morning after this hoped-for transfer occurred, states – and primarily their county political subdivisions – would find themselves responsible for environmental management, law enforcement, fire protection, and a host of other jobs federal agencies now do.  And there'd be no additional money in state coffers to cover any of these costs.  It would be the classic case of being 'land-poor'.

It doesn't take a lot of imagination to figure out what would happen next.   The states and counties would quickly move to sell off their newly-gained lands to raise money.  The pretext would be to raise money to pay for managing all these lands.  But the temptation would be extreme to also use the money to lower or eliminate other taxes – which would of course appeal greatly to the same teabagger types.
So who would have the ready cash to bid at auction for these former federal lands?   Transnational corporations.  The Koch brothers, and their one-percenter country club pals.   Chinese and Russian Mafia billionaires. In other words, the same people who currently own most of everything in this country except for those much-coveted, resource rich federal lands.
Long story short, if you live in the American West, and if you've always taken for granted access to millions of acres of public lands for hunting, fishing, camping, hiking, birding, etc. – well, prepare for a whole new reality if lobbyists like the American Lands Council get their way.  Within a generation, it'll all be gone.   These lands will lie behind gates with big "No Trespassing" signs.


As of 06 January 2016, we're hearing that Ammon Bundy and his misguided stooges will go home as soon as all federal land is "returned" to ranchers and state governments.

Sadly, this simple-sounding idea speaks volumes about the ignorance of these poor saps.  The federal lands can't be "returned," because in the case of almost all Public Lands, these lands have been owned by the 'sovereign' (first the king, then the U.S. federal government) from the moment the first white man stumbled ashore and planted a European flag.  If you doubt that's true, just ask any Indian tribe -- including the Northern Paiute whose land Malheur NWR and the rest of Harney County once was -- whose land ownership was stripped away by the federal government under the so-called Papal Doctrine of Discovery.

Long story short, if it never belonged to you, it can't be "returned" to you.  Right?

Any land in the U.S. now owned by a state, county, city, corporation, individual, or Chinese billionaire, was at some point in the past 'patented' out of federal ownership by the General Land Office or BLM under authority of some federal law or another (e.g., homestead laws, donation land acts, statehood organic acts, etc.).

That said, we here at BAVOB don't condone the growing demands for these protesters' blood.  (Search Twitter for “Oregon” and “drone strike” and you'll find tons of people proposing to give the Malheur activists the Abdulrahman Awlaki treatment. TV host Montel Williams tweeted that the authorities should “put this down using National Guard with shoot to kill orders.” “I hope they pull a M.O.V.E. on those terrorists in Oregon,” wrote the author Jess Nevins, alluding to a black militant group whose Philadelphia headquarters were bombed by the police in 1985, killing 11 people and destroying dozens of homes.)

No, these guys aren't terrorists in the sense of ISIS or Al Qaeda.  They're just really poorly misinformed by the faux-lawyer leaders of this crackpot "movement" like the Bundys ... uber-crackpots who seem to have spun this crazy idea into another full-fledged family cottage industry.

And that just seems to call for better education and more collaborative federal land use policies, not for execution by drone strike. 


You all know I respect anyone’s right to get thoroughly moosed up over just about anything … even if they clearly have no idea what they’re talking about.  But I draw the line when they seize public property, and when they take to disrupting and endangering people’s lives like these “Sovereign Citizen” jackasses are doing out east in Harney County, Oregon.


As amateur ornithologists who have birded and supported Malheur National Wildlife Refuge, we also have a personal dog in this fight.  So I'm taking the gloves off. 

*  *  *

As a bit of background, Malheur National Wildlife Refuge was established in 1908 by President Theodore Roosevelt – hardly a raving socialist in anyone’s book – by setting aside “unclaimed government lands” as a “preserve and breeding ground for native birds.”  (Let’s skip for now the fact that this land had actually been “claimed” by the Northern Paiute tribes since time immemorial, that Malheur was once part of a “permanent” 1,778,560-acre reservation guaranteed eastern Oregon’s “wandering” Indians in 1872, and that the reservation was stripped away from the Paiute less than four years later at the demand of local stockmen and ranchers who thought all that scrubland was being wasted on “savages.”) 

Malheur National Wildlife Refuge was the 19th in a line of 51 unique and irreplaceable national wildlife refuges created by Teddy Roosevelt during his presidency.  I guess executive action is only categorically evil if committed by a black Democrat?  But again, I digress.

And what an amazing place Malheur is, being a crucial stop along the Pacific Flyway that offers resting, breeding, and nesting habitat for millions of migratory birds, as well as habitat for local flora and fauna.

Nor would this important wildlife resource likely exist today without federal efforts.  As the Great Depression roiled the nation, President Franklin Delano Roosevelt created the Civilian Conservation Corps (CCC) in 1933.  With the purchase (not condemnation) of the Blitzen Valley portion of the Eastern Oregon Land and Livestock Company holdings, the Malheur Refuge became an ideal location for CCC people and projects that improved the refuge and supported local businesses through the worst years of the Great Depression with the ongoing purchase of vast quantities of food, fuel, construction materials, and related provender.

Allow me to anticipate the rebuttal here: that just like they've been harassing the poor Hammond family (who didn't arrive on the scene until 1964, and who knew full well they were buying their small ranch right next door to an operating wildlife refuge), the feds must have intentionally driven Eastern Oregon Land and Livestock Company out of business in 1933 so the evil feds could grab their land for their nefarious purposes.  Maybe as a secret landing field for black UN helicopters that the feds secretly knew would be invented in a few decades?  Well, since American national politics during the decade leading up to the Great Depression were dominated by the Republican Party, which controlled both the White House and Congress right up through the 1932 election, it's pretty tough to maintain that proposition.  But I'm sure some will!

Anyhow, where were we?  Oh yeah  – with Ammon Bundy and 100-150 other thugs occupying the public's CCC-built refuge headquarters.  Which is costing us all thousands of dollars daily as Burns area federal employees sit home out of concerns for their personal safety.

Now, I’m not surprised Ammon Bundy can’t articulate what his group of trespassers actually hopes to achieve.  When asked what it would take for the protesters to leave the refuge headquarters, Bundy reportedly replied: “The people will need to be able to use the land and resources without fear as free men and women.  We know it will take some time.” 

Alrighty then … clear as mud!

And I’m not surprised because, having waded through thickets of hair-brained rhetoric in an effort to understand what the entire “Sagebrush Rebellion” gang wants … well, I still have no clear idea.  And it sure ain’t for lack of trying on my part.

Best as I can tell, however, what it all seems to boil down to is a legal theory – I'll dignify it with that label that the intent of the nation's founders and 225 years of constitutional jurisprudence aside, we’ve got it all wrong about the federal government.   

In a nutshell, these well-meaning folks don't believe in the existence of a federal government with authority to own and manage land, or to enforce laws.  Speaking to radio host Dana Loesch, Cliven Bundy once said he believes in a “sovereign state of Nevada,” but that he doesn’t “recognize the United States government as even existing.”   Where did they come up with such an idea?  No idea.

Flowing from this hogwash, Cliven Bundy’s refusal to pay upwards of $1 Million in BLM grazing fees and fines in Nevada is very loosely grounded in Bundy’s notion that the land around his 160-acre Nevada ranchette belongs to the state of Nevada, not to the federal government.  Never mind that the State of Nevada itself lays no such claim to that land!  

No word on the Bundy family's stance on Santa Claus.

*  *  *

While no one would accuse the BLM of being some kind of environmental angel, the so-called “Sagebrush Rebellion” seems to be a reaction to significant federal land-use policy changes in the 1970s as a more environmentally-oriented federal government began imposing use regulations on its vast holdings in the West.  This policy sea-change was based in laws like the National Environmental Policy Act (NEPA) – referred to by some as America’s “environmental Magna Carta” – that was signed into law in 1970 by none other than that liberal political firebrand, President Richard M. Nixon.  Still, many westerners chose to point the blame instead at President Jimmy Carter, who they accused of using Nixon’s environmental laws to target states that didn’t support Carter’s presidential run.  Okay.  Maybe.

So how did we get here from there?

Near as I can tell, all this “Sovereign Citizen” thinking comes from people talking exclusively to other folks who look and think exactly like you do and from otherwise ignoring, you know, ‘reality’.  Which always tends to cause problems.

The one thing I do know is that if these corn-pone intellectuals like Cliven Bundy could have an audience with this country’s founders … well, they’d be laughed right out of the room.  Because if there was one thing America’s founders universally shared, it was a healthy fear of and disdain for an ill-informed, hyper-excited, well-armed rabble like these f-tards now occupying Malheur. 

That’s why the founders included the term “well regulated Militia” in the Second Amendment – their idea of “well regulated” being leadership by landed and educated “gentlemen” who knew precisely what time it was. 

And it’s why the founders separated the rabble – i.e., you and me! – from direct election of the President (think ‘Electoral College’), the Senate (up until the Seventeenth Amendment, ratified in 1913, U.S. senators were elected by state legislatures), and Supreme Court justices (while many states elect even their highest judicial officers, our sage founders chose instead to have ALL federal judges appointed by the indirectly elected president, and confirmed by the indirectly elected senate.)

While we’re on the subject, let’s also clear up this business of a ‘non-existent’ federal government.  That too would shock and awe any Founding Father presented with such a crazy notion.  Because that was a main point of the U.S. Constitution.  As soon as the American colonists had struggled free of King George III, the first thing they tried to do was establish their own strong national government.  And they kept trying until it finally "took" in 1789.

Sorry to be the bearer of bad news, but the modern so-called Tea Party movement is on no better footing than the Sagebrush "rebels."   America’s founders weren’t against government, and they weren’t against taxes.  They were just dead-set against non-representative government (which they considered “tyranny”), and they were dead-set against “taxation without representation” (which was the sole reason for the Boston Tea Party of December 1773).  Otherwise, the founders knew full-well that there were some things that could only be done by a strong central government, and they devoted themselves to creating one of those from the earliest days of the American republic.   

Sorry Cliven.  Sorry Ammon.  You’re both on the wrong side of history.

*  *  *

That said, is there any real oppression going on in this country?  Oh, you bet there is!   

But it’s not orchestrated oppression by wildlife refuge civil servants trying to improve and protect habitat for migrating ducks and geese.  And it’s not by BLM range managers charged working to ensure that private users of the public domain (like Cliven Bundy) pay for what they use, and that their cattle don’t destroy the public’s range lands in the process.

No, the real oppressors of today are the so-called one-percenter mega-rich (both Americans and foreigners) who control America’s tax codes, property laws, and land use regulations through their wildly disproportionate influence over the political process through paid lobbying and virtually unregulated campaign finance. 

The true oppressors of today are also the mega-corporations (both Americans and foreign) which collect any small tax burden they pay from us, their customers, as part of their product or service pricing structure.  And which collect what amounts to an "existence tax" from all of us, daily, through legally-sanctioned monopolistic practices that allow these transnational corporations to set and maintain the prices we all pay for the necessities and amenities of modern life:  food, fuel, shelter, clothing, health care, education, internet access, and virtually everything else our paychecks or pensions go towards.

Still, as long as these real and true oppressors of the people can keep us common working stiffs distracted – by trumped up fights between Republicans and Democrats, Blacks and Whites and Mexicans, Christians and Atheists, Hippies and Patriots, Sovereign Citizens and Federal employees – then won’t any of us have the time or energy to think about them.  And that’s all the true oppressors really need to keep on keeping on, right?