Risk Rap

Rapping About a World at Risk

Chris Cristie’s NJ Energy Plan: Is A Small Business Job Killer that Favors Big Fossil Fuel Energy Interests

Risk Rap returns from its hiatus with a guest blogger Meaghan McCallum.  This is a testimony opposing the Governor Christie’s administration revised 2011 Energy Master Plan.  

Thank you for the opportunity to have my voice heard.  My Name is Meaghan McCallum.  I’ve received my undergraduate degree from Montclair State University, educated in the state public school system, and work in the education field in New Jersey. I am a New Jersey citizen concerned for the future.  With this proposed reduction of Renewable goals that the revised Energy Master Plan establishes, the people of our great state are in jeopardy.  We need to be setting goals that propel us toward a cleaner, brighter future.  We need to take action now in order to build NJ’s economy, quality of life and support our local environment.  Lowering the renewable energy goal to 22.5% and defunding Renewable Energy programs that provide assistance to the public and private sectors to engage with Fossil Fuel industry is not only archaic but criminal.

In 2020, when the lack of vision expressed in Governor Chris Christie’s proposed 2011 revised EMP becomes reality, all of us will have to face our children and try to explain the unexplainable.  Why their rivers are polluted to the point of no recognition, why the air is choked and more hazardous than ever, and why more people, everywhere, are struggling to pay their power bills and simply put food on the table.  Why, we will be living in a dirty state tomorrow when solar and wind are here now and able to rebuild our infrastructure today.

For example, solar energy provides peak power during peak energy hours, which means relief when the grid is most stressed.  Ultimately, the use of solar energy as a primary source of power in state, local, public and private industry will decrease demand and ultimately save the citizen’s power costs dollars on the dollar. Compared with a cheap and easy “fix”, Fossil Fuels will deteriorate the state infrastructure and even further destroy the local economy, by outsourcing fuel contracts and employment to Pennsylvania, the US Midwest, and stimulating foreign markets.

So I ask; are we going to address our children a decade from today in a classroom powered by Renewable, clean energy, in a state where a cleaner, smarter, more efficient future exists?  Because lowering the bar on the Renewable Energy goal to the lowest possible percentage allowed by NJ law and refuting financial subsidiaries for Renewable Energies for a focus on dirty fuel in the name of profits and convenience is not cost effective and will quickly deplete our, the citizens, quality of life and the environment that we depend on.

The 2008 EMP goal to generate 30% of NJ’s total power needs from Renewable Energy sources is responsible for the economic growth and clean energy job creation in the state.  Key legislation was passed and generated over 2,000 clean energy businesses and over 25,000 clean industries employees in New Jersey.  The revised proposal will lower the goal to 22.5% and discourage investors, renewable energy companies and vital renewable energy technology from continued growth in New Jersey.  The revised plan relies on outdated and inflated numbers, and simply disregards proven science and the NJ public’s well-being.  This plan impacts us and it is imperative to demand that the current administration change priorities and address inequities.

Please visit www.state.nj.us/emp/ for information about the EMP and submit testimony to the Board of Public Utilities by August 11 to oppose this dirty energy plan.

 UPCOMING HEARINGS:

 Trenton — Wednesday, August 3rd:

State House Annex
Committee Room 11
125 West State Street
Trenton, NJ Get a map!
1PM – 5PM

Pomona — Thursday, August 11th

Richard Stockton College of New Jersey
Campus Center
Vera King Farris Drive
Pomona, NJ Get a map!
1PM – 5PM

CONTACT:

Beyond Coal Campaign
Sierra Club

Risk: environment, economy, jobs, small business

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July 29, 2011 Posted by | coal fired plants, ecological, energy, environment, republicans | , , , , , , , , | Leave a comment

Economic Recovery Gathers Steam

Private-sector employment increased by 217,000 from January to February on a seasonally adjusted basis, according to the latest ADP National Employment Report released today. The estimated change of employment from December 2010 to January 2011 was revised up to 189,000 from the previously reported increase of 187,000. This month’s ADP National Employment Report suggests continued solid growth of nonfarm private employment early in 2011. The recent pattern of rising employment gains since the middle of last year was reinforced by today’s report, as the average gain from December through February (217,000) is well above the average gain over the prior six months (63,000).

The fears of a jobless recovery may be receding but the US economy has a long way to go before pre-recession employment levels are achieved. As we stated previously the economy needs to create over 200,000 jobs per month for 48 consecutive months to achieve pre-recession employment levels. The six month average of 63,000 is still well below the required rate of job creation for a robust recovery to occur. The Unemployment Rate still exceeds 9%.

The February report is encouraging because it points to an accelerating pace of job creation. The post Christmas season employment surge represents a 30,000 job gain over January’s strong report that triples the six month moving average. The service sector accounted for over 200,000 of the job gains. The manufacturing and goods producing sector combined to create 35,000 jobs. Construction continues to mirror the moribund housing market shedding an additional 9,000 jobs during the month. The construction industry has lost over 2.1 million jobs since its peak in 2008.

The robust recovery in the service sector is welcomed but sustainable economic growth can only be achieved by a robust turn around in the goods producing and manufacturing sectors. Service sector jobs offer lower wages, tend to be highly correlated to retail consumer spending and positions are often transient in nature. Small and Mid-Sized Enterprises (SME) is where the highest concentration of service jobs are created and the employment figures bear that out with SMEs accounting for over 204,000 jobs created during the month of February.

Large businesses added 13,000 jobs during the month of February. The balance sheets of large corporations are strong. The great recession provided large corporates an opportunity to rationalize their business franchise with layoffs, consolidations and prudent cost management. Benign inflation, global presence, outsourcing, low cost of capital and strong equity markets created ideal conditions for profitability and an improved capital structure. The balance sheets of large corporations are flush with $1 trillion in cash and it appears that the large corporates are deploying this capital resource into non-job creating initiatives.

The restructuring of the economy continues. The Federal stimulus program directed massive funds to support fiscally troubled state and local government budgets. The Federal Stimulus Program was a critical factor that help to stabilize local government workforce levels. The expiration of the Federal stimulus program is forcing state and local governments into draconian measures to balance budgets. Government employment levels are being dramatically pared back to maintain fiscal stability. Public service workers unions are under severe pressure to defend employment, compensation and benefits of workers in an increasingly conservative political climate that insists on fiscal conservatism and is highly adverse to any tax increase.

The elimination of government jobs, the expiration of unemployment funds coupled with rising interest rates, energy and commodity prices will drain significant buying power from the economy and create additional headwinds for the recovery.

Macroeconomic Factors

The principal macroeconomic factors confronting the economy are the continued high unemployment rate, weakness in the housing market, tax policy and deepening fiscal crisis of state, local and federal governments. The Tea Party tax rebellion has returned congress to Republican control and will encourage the federal government to pursue fiscally conservative policies that will dramatically cut federal spending and taxes for the small businesses and the middle class. In the short term, spending cuts in federal programs will result in layoffs, and cuts in entitlement programs will remove purchasing power from the demand side of the market. It is believed that the tax cuts to businesses will provide the necessary incentive for SME’s to invest capital surpluses back into the company to stimulate job creation.

The growing uncertainty in the Middle East and North Africa is a significant political risk factor. The expansion of political instability in the Gulf Region particularly Iran, Egypt and Saudi Arabia; a protracted civil war in Libya or a reignited regional conflict involving Israel would have a dramatic impact on oil markets; sparking a rise in commodity prices and interest rates placing additional stress on economic recovery.

Political uncertainty tends to heighten risk aversion in credit markets. The financial rescue of banks with generous capital infusions and accommodating monetary policies from sovereign governments has buttressed the profitability and capital position of banks. Regulatory uncertainty of Basel III, Dodd-Frank, and the continued rationalization of the commercial banking system and continued concern about the quality of credit portfolios continue to curtail availability of credit for SME lending. Governments are encouraging banks to lend more aggressively but banks continue to exercise extreme caution in making loans to financially stressed and capital starved SMEs.

Highlights of the ADP Report for February include:

Private sector employment increased by 217,000

Employment in the service-providing sector rose 202,000

Employment in the goods-producing sector declined 15,000

Employment in the manufacturing sector declined 20,000

Construction employment declined 9,000

Large businesses with 500 or more workers declined 2,000

Medium-size businesses, defined as those with between 50 and 499 workers increased 24,000

Employment among small-size businesses with fewer than 50 workers, increased 21,000

Overview of Numbers

The 202,000 jobs created by the SME sectors represents over 90% of new job creation. Large businesses comprise approximately 20% of the private sector employment and continues to underperform SMEs in post recession job creation. The strong growth of service sector though welcomed continues to mask the under performance of the manufacturing sector. The 11 million manufacturing jobs comprise approximately 10% of the private sector US workforce. The 20 thousand jobs created during February accounted for 10% of new jobs. Considering the severely distressed condition and capacity utilization of the sector and the favorable conditions for export markets and cost of capital the job growth of the sector appears extremely weak. The US economy is still in search of a driver. The automotive manufacturers have returned to profitability due to global sales in Latin America and China with a large portion of the manufacturing done in local oversea markets.

The stock market continues to perform well. The Fed is optimistic that the QE2 initiative will allay bankers credit risk concerns and ease lending restrictions to SMEs. A projected GDP growth rate of 3% appears to be an achievable goal. The danger of a double dip recession is receding but severe geopolitical risk factors continue to keep the possibility alive.

Interest rates have been at historic lows for two years and will begin to notch upward as central bankers continue to manage growth with a mix of inflation and higher costs of capital. The stability of the euro and the EU’s sovereign debt crisis will remain a concern and put upward pressure on interest rates and the dollar.

As the price of commodities and food spikes higher the potential of civil unrest and political instability in emerging markets of Southeast Asia, Africa and Latin America grows. Some even suggest this instability may touch China.

The balance sheets of large corporate entities remain flush with cash. The availability of distressed assets and volatile markets will encourage corporate treasurers to put that capital to work to capitalize on emerging opportunities. The day of the lazy corporate balance sheet is over.

Solutions from Sum2

Credit Redi offers SMEs tools to manage financial health and improve corporate credit rating to attract and minimize the cost of capital. Credit Redi helps SMEs improve credit standing and demonstrate to bankers that you are a good credit risk.

For information on the construction and use of the ADP Report, please visit the methodology section of the ADP National Employment Report website.

You Tube Video: John Handy, Hard Work

Risk: unemployment, recession, recovery, SME, political

March 3, 2011 Posted by | commerce, credit, Credit Redi, economics, government, lending, manufacturing, recession, risk management, SME, taxation, Tea Party, unemployment, unions | , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment

Bring the Warriors Home

Heart of my heart, is it meet or wise
To warn a King of his enemies?
We know what Heaven or Hell may bring,
But no man knoweth the mind of the King.
Of the gray-coat coming who can say?
When the night is gathering all is gray.
Two things greater than all things are,
The first is Love, and the second War.
And since we know not how War may prove,
Heart of my heart, let us talk of Love!”

The Ballad of the King’s Jest

Rudyard Kipling

The irony of President Obama’s selection as the Nobel Peace Prize winner for 2009 was not lost on the recipient. In one of the receptions held to honor him, Mr. Obama spoke about Alfred Nobel’s invention of dynamite and its use as a weapon of war as the source of wealth that funds the prestigious peace prize.   Earlier in the day during his acceptance speech, Mr. Obama spoke eloquently on the motives for his decision to continue the prosecution and escalation of the Afghan war.  As a war time President, Mr. Obama sees war as a tool to bend the will of history toward justice and good.  He believes the greatest global good will be served by the pursuit of the Afghan conflict.  I respectfully disagree.

The greater irony in Mr. Obama’s acceptance speech for a peace prize is that it was essentially a discourse of war apologetics.    Mr. Obama delivered a speech void of any contrition and never once equivocated as he outlined his commitment and reasoning why a nation should engage in war.  To be fair to Mr. Obama, his decision to escalate the war in Afghanistan is not a surprise. Throughout his Presidential election campaign, Mr. Obama was explicitly clear that he intended to pursue Osama bin Laden and his band of murderous terrorists to the Gates of Hell.  Even if those gates led to a protected compound in downtown Karachi,  Mr.  Obama’s resolve to check mate al-Qaeda remains steadfast.

The problem with the continued prosecution of the Afghan War is that our enemies are not a nation state nor do they occupy a single geography.  Al-Qaeda and their confederates are stationed throughout the globe.  They exist in underground sleeper cells waiting to be summoned by unconscionable puppet masters.  They are guided by an ideology of hate neatly disguised and wrapped in a hajab of religious orthodoxy. They use asymmetric strategies and tactics to wage war on citizens and soldiers alike.  A conventional army garrisoned in a provincial  hamlet is ill suited to fight an enemy that knows no bounds in territories and tactics and is prepared to conduct a military operation that spans multiple generations.

The Taliban and al-Qaeda’s access and control of Afghanistan’s lucrative opium trade forms the socio-economic base that allows them to leverage considerable political power to pursue their terrorist agenda.  The opium trade is weaved into a complex tribal culture whose power and prominence supersedes a weak and corrupt central government that derives its right to govern by the tepid consent of friendly tribal leaders and the military might of foreign armies.    Afghanistan like other narco dependent states will remain politically unstable and continue as a terroristic threat to the United States until the opium trade is supplanted as the countries principal source of economic and political power.

Afghanistan is not the world’s sole narco-terrorist state.  A number exist in the Western Hemisphere and one need look no further then across the Rio Grande to witness the growing power of a narco-dollar financed state subversion.  Mexico’s difficulties serve as a reminder that the risks to the stability of our republic lie much closer to home and is in fact in full residence within our borders.  Engaging a war in Afghanistan is a clear and present distraction from addressing the pressing issues that undermine our national security.

True al-Qaeda’s acquisition of a nuclear weapon conjures up many unimaginable and terrifying scenarios.  Unfriendly regimes that are hostile to the United States like North Korea and Iran control nuclear capabilities.  But we have  no armies attacking them.  Perhaps the solution is to remove nuclear weapons and uranium devises beyond the reach of the Taliban, al-Qaeda and other avowed enemies of our republic.  If this is the major threat, its mitigation can be achieved without the prolonged deployment of 130,000 troops.   It can be accomplished by having an international force guard and quarantine Pakistan’s nuclear arsenal.  Certainly the Bush Doctrine allows for this type of intervention.  Some will object to this course of action on the grounds that we must respect Pakistan’s sovereignty.  But Mr. Obama’s escalation of the Afghan War will require unilateral incursions into Pakistan.  This action to eliminate the ultimate horror of nuclear weapons falling into the hands of terrorists is the surest way to mitigate this pressing threat.

The multifaceted omnipresent dangers to the United States transcend nuclear terrorism. Economic degradation is compounding social problems and creating deep political fissures within the country.  Our countries fractured culture is being exploited by powerful self serving interests.  A cabal of corporate elites equate national security with their economic well being.  They employ armies of lobbyists  and ply multi-channel media platforms to stoke fear and division to advance their narrow interests.  Usually at the expense of supporting initiatives that address the complex threats that weigh on the security of the country.  These special interests attack programs that stabilize social safety nets.  They finance expensive media campaigns condemning aid for local government fiscal stability, universal health care, meaningful environmental policy, expanded funding for public education, infrastructure improvements, support for trade unions, job creation programs and social assistance programs.  The well being of our people is the basis of our national prosperity.  The sources of social instability remain strong and continue to grow.  The recession,  a jobless rate of 10%, 4 million foreclosed homes, 30 million citizens unable to have access to affordable health care, failing school systems, bulging prison systems and environmental degradation represent a greater threat to national security then 100 al-Qaeda fighters holed up in an ice cave in the Tora Bora tribal regions.

No doubt  the United States was attacked by terrorists enjoying protection of a friendly regime in Afghanistan.  On 9/11 I witnessed first hand the horror of fellow countrymen jumping to their deaths from the upper floors of the World Trade Center.  Moments later as I stood in front of Trinity Church I escaped the pyroclastic cloud of the falling South Tower through a revolving door on Wall Street.   I understand the irrational hatred terrorists harbor in their hearts and the devastating consequences of their insane acts.  They are a cancer that must be eradicated.

Mr. Obama, has stated that the Afghan insurgency enjoys no popular support.   Afghanistan has a long memory and a longer history of a people subjected to the designs of imperial powers and foreign invaders since the time of Genghis Khan. The resistance to foreign occupation by the Afghani’s is legendary.  From the massacre of Elphinstone’s Army trying to escape blood thirsty tribes through the Khyber Pass, to the Soviets disgraceful retreat from the hail of Stinger Missiles supplied by the United States; it now  may be our time for a  ride in this horrible wheel barrel.

Afghanistan is a region of the globe where the great powers and trends of history clash.  It is a vortex of a turbulent maelstrom that brings the powers of China, Russia, India and Islam into a volatile mix.  The forces of national interests and modernity is held at bay by tribesmen toting WWII rifles, expedient tribal allegiances and ancient codes of honor.  Why doesn’t China and India have a more prominent role in ending this conflict?   It is in their geopolitical interest.  Better let the United States  send its nations finest young people to chase phantoms and fight in the endless canyons of the Hindu Kush; while Chindia builds their economies at home and forge new alliances abroad.  Perhaps they hope that this war could be the Pax Americana’s Waterloo?

Mr. Obama quoted from Dr. Martin Luther Kings Nobel acceptance speech, stating, “Violence never brings permanent peace. It solves no social problem: it merely creates new and more complicated ones.”  This above all else may prove to be the most prophetic and ironic truth to Mr. Obama’s war.

The United States cannot afford this war. It is a distraction. It weakens us.  National security is more then a well provisioned and gallant army. A nations strength and its ultimate security is based on an enlightened, well fed, healthy and industrious people.

Mr. Obama acknowledged his indebtedness to those that went before him.  He stated that, Mahatma Gandhi, George Marshall, Albert Schweitzer,  Martin Luther King Jr. and Nelson Mandela are worthy figures that we should emulate.  Their greatness showed us that a better path must be chosen if we are to progress as a people.  Their choices and examples of leadership were not based on expediency and some came at  terrible cost.  The pathway of war is worn and old.  The world is much too weary from the familiar journey.  Its time to choose a better path.  End the war now Mr. Obama.  Bring the troops home.

You Tube Music Video: Mormon Tabernacle Choir, Battle Hymn of the Republic

Risk: war, peace

December 14, 2009 Posted by | 9/11, China, economics, Obama, recession, war | , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | 1 Comment