“Thank you, frackers!”

2015 has been a pretty bleak year for the country.  Labor force participation remains at a stubborn four-decade low and even The New York Times admits that we are 2.8 million jobs behind pre-recession levels of employment; the economy is so “fragile” that even a ¼-point Fed rate increase is treated like a live hand grenade.  ACA enrollment has yet to meet any predictions, despite multiple extensions and two gifts from the Supreme Court. The Iran deal was so laughably one-sided that the Administration made sure that Democrats would not even have to vote on it.  And now, with terrorists spraying bullets and bombs in California and France, we have only a climate change photo-op to oppose it.

But  there is one immense Christmas present under the White House tree and on the doorstep of every American household.  The fracking revolution wrought by the U.S. oil industry (without any help from the Administration) has resulted in every American family having at least $1,000 in extra spending money.  It’s better to be lucky than good; President Obama has dodged one bullet and he has the Saudis and the U.S. oil industry to thank.  That technology leap developed by the “oil barons” spurred an increase in domestic production that the Administration retarded wherever possible (by stonewalling and stalling drilling permits on federal lands, where production has not increased).  It caused the Saudis to open the spigots to protect their turf.  So, instead of $90 a barrel, we’re at $40 a barrel.  By a very conservative estimate, every family has approximately $1,000 in extra spending money — due explicitly to the decline in gasoline prices.

Here’s the math.  American households average well over 20,000 miles driven each year.  Let’s take the low figure.  Household vehicles (allegedly) average 20 miles per gallon.  No one who actually drives a car really believes that the current U.S. household vehicle gas mileage average is this high, but let’s take it on faith.  Those figures work out to every household buying at least 1,000 gallons of gas per year.  Gas is a dollar cheaper than a year ago, and that will continue.  As early as January 2015, GasBuddy.com senior analyst Patrick DeHaan predicted that plummeting prices would save U.S. motorists about $97 billion overall this year, or about $750 per household.  But that number was based on gas prices averaging $2.64 per gallon, when oil was about $53 per barrel. The real number for 2015 is roughly 60 cents less, barely above $2.00 a gallon … i.e. 25% lower.  So households have at least $1,000 extra in aftertax money, to save or spend as they wish.  That is what has helped average Americans and their pocketbooks.

Once the Saudis moved to open the taps in response to the U.S. fracking revolution, the price dropped.  And dropped.  And dropped again.  So the much-maligned Saudis have also screwed the Russians, the Iranians, and the Venezuelans, all of whose malignant regimes depend on petrodollars for their schemes.  You think Putin and the Iranians have had us over a barrel this year?  Well, they have, but think how assertive they would have been were it not for the villainous U.S. oil industry.  Forty-dollar oil is crushing the bad guys.   Think how bad things could have been if Putin’s, Khamenei’s, and Maduro’s coffers were being topped off by selling $90 oil instead.

So, thank you, ExxonMobil.  Thank you, frackers.*  Thank you, King Salman.


*In particular, Texas and North Dakota.  Neither of those states voted for Obama in 2008 or 2012, and the President surely doesn’t spend much time worrying about whether their economies are now in freefall.  But he (and we) should at least acknowledge the gift they have bestowed upon the country.



What’s new with Iran? Uhhhh, nothing. Well, nothing good.

In the wake of the purported opening of a new era in relations with Iran, the American people should not forget these hostages of a terrorist regime:

  • Jason Rezaian, Washington Post journalist, recently “convicted”;
  • Amir Hekmati, former U.S. Marine,
  • Saeed Abedini, pastor and
  • Robert Levinson, former FBI agent.

And, if the reports are true, within the last week or so,

  • Siamak Namazi, a dual U.S.-Iranian citizen, who was snatched up while visiting relatives in Tehran for the apparent crime of … what?

Since the President is otherwise occupied, will someone find out if Josh Earnest has anything to say about this?

When Does It Stop Being Bush’s Fault?

The unemployment rate is drifting lower and is cited by many as a sign that the economy is improving and will soon be robust.  But that figure is a non sequitur at best, and a lie at worst.  The current unemployment rate of 5.1% is hardly comparable to similar rates of 10 or 20 years ago because millions of people have stopped looking for work and are thus not counted as unemployed.  The figure we ought to be looking at – and alarmed by —  is actual labor force employment as a percentage of the working age (15-to-64-year-old) cadre.  This group is composed of working-age people who normally would not have retired.  (Of course, there are some people outside that group who are working, but for this analysis, the ratios discussed below should be comparable.)

It’s very hard to get perfect numbers for apples-to-apples comparisons, but after about two hours of reviewing eye-glazing charts from the Bureau of Labor Statistics and the U.S. Census, and using comparable statistics for December 2000 and March 2015, this is what we derived:

In late 2000, the 15-to-64 U.S. population was 180,201,025.  The total number of employed persons was 133,465,403.  That is a 74.1% ratio.  By March 2015, over six years into the current Administration, and trillions of dollars of stimulus and deficits later, the 15-to-64 population was 204,026,415 and the number of employed persons was 139,843,024.  The latter ratio is 68.5%.  That is a decline of 5.6% applied to a working-age population of just over 204 million.  If the same ratio of employment to working-age population existed in 2015 as at the end of the Clinton Administration, approximately 151,200,000 people would be working   In other words, over 11 million fewer people are working in this country than one would expect if the current employment figures paralleled the last days of the Clinton Administration.

This is an “epic fail.” It is also the most signal, disheartening domestic tragedy of the last 6 years.  Ultimately, the strength of our society is based upon tens of millions of Americans working, making decent wages, supporting themselves and their families, and paying taxes to support both domestic and military needs, including help for those who cannot help themselves.  Do we want to pay for the Affordable Care Act?  We need more jobs and more wage-earning taxpayers.  Do we want a strong military?  Ditto.  How about air traffic controllers?  Ditto.  National parks? Ditto.  And do we really want to do something about inequality, instead of just talking about it?  Once again, ditto.

Today’s employment figures are pathetic compared to historical percentages, despite the increasing participation of women in the work force, and despite the fact that many of those women are working because men in households are not earning enough to support their families.  The takeaway is that we have far fewer taxpayers (i.e. people pulling the wagon) and far more people needing/receiving benefits (i.e. sitting in the wagon) than we should.  And with a larger percentage of over-65 citizens in an aging population, we desperately need the 15-to-64 age-group working percentage to return to historical levels, so we have more workers paying taxes and supporting governmental functions.  Since we are looking at the 15-64 cadre, the retirement of baby boomers is simply not an excuse, or even a fig leaf, for this disheartening statistic.

The figures are stark and cannot be brushed aside.  Panglossing the truth by citing the improving “unemployment rate” is ignorance or knavery.  The unemployment rate is deceptively better because millions of people have stopped looking for work.  The President and the apologists inside and outside the Administration won’t grapple with this, at least not publicly.  Paul Krugman continually decries “austerity,” as if adding half a trillion dollars in deficit spending every year since the “stimulus package” is some kind of savage yanking away of the national punchbowl. Does any rational, knowledgeable American think the economy hasn’t taken off because we haven’t gone far enough down the Krugman highway?

Incentives to work — and fewer incentives not to work — are all that’s left to us.  Incentives to create businesses and offer jobs and fewer disincentives to investment are what we need. Only then will we climb out of this ditch that we have dug for our proverbial ox—and our society.

Mitt was Right

“This is my last election. After my election, I have more flexibility.”
— President Barack Obama, speaking to then-President Dmitry Medvedev of Russia about arms control and other issues on a “hot mic” in S. Korea, March 26, 2012.

“Russia is without question our No. 1 geopolitical foe. They fight for every cause for the world’s worst actors. The idea that [President Obama] has more flexibility in mind for Russia is very, very troubling indeed.”
–Mitt Romney, in a CNN interview responding to the “hot mic” incident above, March 26, 2012.

“The 1980s are now calling to ask for their foreign policy back because the Cold War’s been over for 20 years.”
–President Obama, in the third presidential debate, ridiculing Romney’s assessment, October 22, 2012.

“We have been very clear to the Assad regime, but also to other players on the ground, that a red line for us is [if] we start seeing a whole bunch of chemical weapons moving around or being utilized. That would change my calculus. That would change my equation.”
–President Obama, August 20, 2012.

“I didn’t set a red line. The world set a red line.”
–President Obama, at a news conference in Stockholm, after strong proof of chemical weapons deployment by the Assad regime against civilians, September 4, 2013.

“Yes, but . . . the analogy we use around here sometimes, and I think is accurate, is if a JV team puts on Lakers uniforms, that doesn’t make them Kobe Bryant. I think there is a distinction between the capacity and reach of a bin Laden and a network that is actively planning major terrorist plots against the homeland versus jihadists who are engaged in various local power struggles and disputes, often sectarian.”
–President Obama, interviewed by David Remnick regarding the ISIL faction that had just overrun Fallujah, January 7, 2014.

“Keep in mind I wasn’t specifically referring to (Islamic State) …. They’re not a JV team.”
–President Obama, in a September 7, 2014 interview on Meet the Press. Politifact rated the first sentence of this clarifying statement as False.  http://www.politifact.com/truth-o-meter/statements/2014/sep/07/barack-obama/what-obama-said-about-islamic-state-jv-team/

Notwithstanding 6 ½ years of on-the-job training, including multiple opportunities to observe pure evil and evil cunning, the events in Syria of the last two weeks, not to mention the last three years, have apparently surprised a sitting President, his Secretary of State, and perhaps the entire Obama inner circle. The Obama Administration was shocked that the Russians sent air force assets to Syria, but nonetheless the President and Vladimir Putin shook hands three days ago. Within 48 hours, the President was even more shocked that Russians’ first targets were not ISIS, but rebels opposing the Assad regime.

How could that have happened?

The answer is simple, and it is stark. This President has coupled a biased and naïve worldview with a remarkable arrogance and an unwillingness to take unwelcome advice from knowledgeable people inside and outside the Administration. It has cost us dearly. This President prefers words to deeds. (Yes, he authorized the strike on Osama bin Laden, for which he deserves credit, but other than drone strikes, that’s it for the use of force.) Presidential inaction has become the norm, the bad guys know it, and the decline of American influence is palpable.

Perhaps we should reassess the wisdom of electing to the Presidency individuals who couple slim resumes with naïve worldviews. When a Mitt Romney (or for that matter, Marco Rubio), with no NSA or CIA staff, is more prescient than the Administration about the Russians’ intentions and actions, we should be disheartened. Actually, we should be furious.

Syria is perhaps the most salient example of the failures of this Administration. Barack Obama came into office convinced that good intentions and prior American credibility would enable the United States to hit the “reset button” with old adversaries. There is nothing wrong with good intentions and high hopes, but when reality dashes them, it is time for the American President to take note and act accordingly. Our problems in Syria really started when the President nonchalantly established a “red line” — and put American credibility on the line. He then shrank from the responsibility established by his own rhetoric, and even tried to deny words from his own mouth. If a two-bit dictator like Bashar al-Assad can gas and murder his own people with impunity for three years, without meaningful reaction from the United States, notwithstanding our having stated that chemical weapons are crossing the Rubicon what message should the rest of the world take from America’s indifference (or fear)? Is it any wonder that Vladimir Putin took the measure of our President and invaded and annexed Crimea? Or that he is still subverting the remainder of a now-truncated Ukraine? Or that he is now propping up his Syrian client murderer?

In September, Russia not only “surprised” the Administration by moving jets to Syria, but it used its airpower to bomb rebels who oppose Assad, rather than to fight the Islamic State. And it gave the U.S. about one hour’s warning. Can anyone imagine a more “in your face” gesture? Would the Russians have dared to do that at any time in the last 50 years, regardless of which party occupied the White House?

To those apologists who shrug their shoulders and ask, “What would you have done?” this writer believes that, at the time, say 2012, or 2013, or 2014, or even until a month ago, the United States should have established a no-fly zone over Syria, as many analysts and experts recommended. It should have armed and replenished the Syrian rebels, as many analysts and experts also recommended. And to those who now wring their hands and claim it is too late to respond, that is not true. Even now, it is not too late to tell the Russians through private channels that if they bomb rebel positions again, we will not stand by idly. But we have to mean it. It is not too late. We can arm and replenish the Syrian rebels who are not ISIS. We know who they are. And our aid should include giving them antiaircraft weapons to knock out any hostile aircraft that bomb them instead of ISIS.

The Crimea is lost, Ukraine possibly so, and our allies in Europe and the Middle East regard us with doubt if not disdain. Time to reverse the slide.

An Open Letter to President Obama and Energy Secretary Moniz

Dear President Obama and Secretary Moniz:

I implore you to advocate for and cajole Congress — specifically the Democratic members of both Houses — to eliminate the obsolete and now-mindless prohibition on the export of domestic crude oil.  Surely American roughnecks, America fracking crews, and American petroleum engineers deserve treatment equal to that of Iranian oilfield workers, engineers and mullahs.

It is well-known that approximately 150,000 domestic energy jobs have been lost in the past nine months, since oil prices began their freefall.  Many of those layoffs have been drillsite roughnecks and fracking crews.  Not surprisingly, working people are suffering much more than executives.  Soon the layoffs will extend further, to engineers and scientists.  We should seek to avoid excessive unemployment, and certainly try to avoid losing technical knowledge and expertise that has seen this industry outperform almost all others in job creation in the U.S.  As of now, the domestic price of oil lags well below where it should be.  West Texas Intermediate is priced at $5 to $7 below Brent, and that differential is clearly rooted in the prohibition on the export of crude.  Our refineries are not uniformly set up to accommodate light domestic crude.  Free trade will not only fairly compensate domestic producers, but it will also help restore competitive balance to the United States.  Once upon a time, there might have been a justification, or a plausible explanation, for keeping domestic crude in the U.S., as a way of insulating our economy from price shocks.  In view of the technological advances wrought entirely by U.S.-based energy concerns, that explanation no longer passes the “straight-face” test.

The technological revolution wrought by the U.S. energy industry (and the partial leakage of petroleum products overseas through exports of refined products) had a role in forcing Iran to the table, but Washington has given the back of its hand to this industry. As a result of various unfriendly initiatives and market distortions written into law, including the export ban, we are hollowing out our employment base.  There will come a day of reckoning if this is not reversed.  More immediately, the staggering layoffs described above (with more to come) hit roughnecks and other ordinary working people much worse than executives.  At the very least, we should allow a free market, including exports. It is absolute insanity to treat Iranian oil more favorably than domestic oil.  If the United States Government can justify spending tens of billions of dollars to bail out inefficient auto manufacturers to save jobs in the Midwest, why can’t it at least allow an efficient industry the opportunity to compete worldwide?  That’s not corporate welfare; it is common sense.  Any other path, including the one we now travel, punishes working people for no good reason.

Surprise me.  Please.


Lee Kaplan

*Not to mention insulating General Motors from liability for concealed ignition defects that killed American consumers.

How Not to Attract Business to Texas

I read not long ago that Governor Abbott said he will “go anywhere, anytime to continue keeping Texas No. 1 in the nation for attracting jobs and attracting businesses.”  After Abbott’s first six months as Governor, I think we’ll do better attracting business to Texas if he just stays home and acts sensibly [read:  keeps his mouth shut].  My advice to the Guv is, “Don’t do anything [else] stupid!”

When CEO’s of companies as large as GE, or as small as a five-person startup, think about where to locate, they consider not only the tax and regulatory burden –what we Texans call “the bidness climate” —  but also the health, welfare, morale and anticipated productivity of their employees.  Almost everything emanating from the state capital during the first six months of the Abbott Era tilts the scales the other way, and virtually guarantees that companies whose CEO’s would otherwise consider relocating here to take advantage of low taxes, less regulation, and nonunion workers will not do so.

Governor Abbott came into office needing to distance himself, if only slightly, from his reputation outside the state.  His oft-quoted signature line about his tenure as Texas Attorney General, when speaking to a tea party group two years ago [“I go into the office, I sue the federal government and I go home”] undoubtedly was red meat to his base, but doesn’t go over in GE’s home state of Connecticut.

Abbott’s first immense misstep came after just a few months in office as Governor when he pandered to a small group of loonies who were worried about routine military exercises that were to be carried out in central Texas – the Jade Helm exercises.   The U.S. military might have been forgiven for thinking that Texans would welcome them with open arms.  But there are always fringe elements and, unfortunately, the Governor heard them.   In response to some worried letters and emails from people who apparently expected black helicopters to spearhead an invasion of sacred Texas soil, on April 15, Abbott made the State a laughingstock when he directed the Texas State Guard to “monitor” U.S. military training exercises in central Texas so that Texans would “know that their safety, constitutional rights, private property rights and civil liberties will not be infringed.”

That was not his first error, either.  Previously the Governor had already added his voice to the “anti-vaxxers,” supporting the right of parents to opt out of vaccinations for their children not just for medical reasons but for religious or personal objections.  Ummmm hmmmh.  Just what we need: more sick children.  Here are the unpleasant facts.  There are contagious illnesses out there, and schoolchildren are vulnerable. Measles are highly contagious, particularly in schools.  In 1958 Texas had over 85,000 cases; since then the total has dropped to almost none.  Do we want it to increase again?  In Texas in the 2013-2014 school year, more than 38,000 students making up roughly 0.75 percent of the state’s school-age population used exemptions to avoid vaccinations, according to a Houston Chronicle analysis of data from the Department of State Health Services. That was far higher than a decade earlier, when exemptions were granted to just 3,000 students making up about 0.1 percent of the population, according to the Chronicle.  So the percentage of unvaccinated children has increased more than sevenfold in a decade.  And this took place with the backdrop of the measles outbreak in California.  This kind of loopy failure to protect one’s children, based on no science, and in fact, flying in the face of science and rational thought, is not limited to rural counties.  Travis County (Austin) and Collin and Denton counties (suburban Dallas) are among the leaders in the percentage of the unvaccinated.  What is the Governor thinking?  Shall we risk a few extra cases of polio as well?

Add to this the recent enactment of a more robust “open carry” law, that is, the inalienable right of citizens to carry firearms wherever they wish, including Wal-marts, university campuses, and even churches.  Governor Abbott was proud to sign the open carry law at Red’s Indoor Range, a popular gun store and shooting range in Pflugerville. Bottom line — the Republican ruling class in Austin has certainly sent the wrong message to mild-mannered CEO’s who might have thought about leaving high-tax states for Texas.

Finally, recent developments on the “social issues” front have not cast Texas in the light best suited for gaining relocations, and for this Governor Abbott shares the blame, but again takes the lead.  Most Americans have a laissez faire attitude about abortion and gay marriage.   Governor Abbott is well known as a pro-life [read: “anti-abortion”]  enthusiast.  Texas has for years defended strict limits on abortion, and as Attorney General he was bound to defend such legislation.  Texas has a well-earned reputation of caring far more about restricting Texans’ personal lives (and specifically, their activities in the bedroom or on the couch) than about regulating their commercial activities.  Outside Texas, these views carry little weight.  A slight majority of Americans think abortion should be legal under some circumstances, while nearly 30% of Americans think it should be legal under all circumstances.  Only 19% think it should be prohibited under all circumstances.  The ham-handed efforts of the solidly Republican Texas Legislature to evade and restrict Roe v. Wade have attracted unfavorable attention, too, perhaps even from the United States Supreme Court.  Governor Abbott has embraced those efforts and is strongly identified with them.

Or, as wickedly satirical Andy Borowitz has said, “In Texas currently your personal safety pretty much peaks when you’re a fetus and it’s all downhill from there.”

More to the point, this Governor’s views on same-sex marriage are well out of step with the views of the workers he would like to attract to Texas.  The last straw was Abbott’s tacit invitation (and the not-so-tacit invitation by Texas’s Attorney General Ken Paxton) to state officials to ignore the United States Supreme Court’s Obergefell v. Hodges decision.  In fact, Abbott’s and Paxton’s views are even out of step with a majority of the very conservative Texas Supreme Court.  On June 19, just one week before Obergefell, by a 5-3 ruling (ardent conservatives prevailing over last-ditch conservatives), the Texas Supreme Court denied the State’s effort to intervene belatedly in the case of a gay couple who had been granted a divorce here after marrying elsewhere.  The Texas court decided only that the attorney general (who at the time was Greg Abbott) had intervened too late.  Abbott’s statement as Governor reflected his pique at the court on which he had once been a member:  “The [C]ourt mistakenly relied on a technicality to allow this divorce to proceed…[it] did not address the Texas Constitution’s definition of marriage – and marriage in Texas remains an institution between one man and one woman.”

Not so fast, Guv(!)

One week later, when the U.S. Supreme Court issued Obergefell, Governor Abbott was predictably even more outraged.  Notwithstanding his law school training, the one-time judge and former highest legal officer of the State had this to say, in an outburst reminiscent of segregationist governors during the ‘50’s and ‘60’s:

“The Supreme Court has abandoned its role as an impartial judicial arbiter and has become an unelected nine-member legislature. Five Justices on the Supreme Court have imposed on the entire country their personal views on an issue that the Constitution and the Court’s previous decisions reserve to the people of the States.

“Despite the Supreme Court’s rulings, Texans’ fundamental right to religious liberty remains protected. No Texan is required by the Supreme Court’s decision to act contrary to his or her religious beliefs regarding marriage.”

Governor Abbott undoubtedly knew exactly what he was saying.  The elected county clerks in Texas’s 254 counties are responsible for issuing marriage licenses.  Governor Abbott invited these elected representatives, who take oaths to uphold the law and perform their statutory duties, to refuse to issue marriage license to gays if their “conscience” forbids it.

These incidents, all occurring within the first 180 days of the Abbott Era, lead dispassionate observers to wonder if there are there any adults in the Governor’s inner circle.  Is there no one willing to say, “Boss, this is ridiculous.”?  No matter how this kind of nonsense is dressed up, it is viewed with laughter or contempt – or both — by business people throughout the country.  The vast majority of people who run businesses just want productive workers.  They don’t care what their employees do at home, so long as they come to work and do their jobs.  CEO’s know they have gay workers, open or closeted.  Prudent CEO’s are unlikely to relocate their business to a State whose top officials are unremittingly hostile to their employees’ lifestyle choices.

Greg Abbott was once a respected state court judge.  Over the years he has dissipated his credibility by moving ever farther to the right, but he has accelerated the process during his first six months as Governor.  His views on vaccinations, guns, military invasion (by our own military), abortion rights and gay marriage show that he is primarily interested in pandering to kooks rather than insuring the well-being of the State.  And we’re going to pay for it.