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    Democrat senators call for a freeze on arms sales to Saudi Arabia amid oil production cuts – video

    Two Democrat senators have called for a freeze on arms sales to Saudi Arabia unless it reverses a Riyadh-led Opec+ decision to cut oil production. They said the decision to reduce production would help Russia’s war in Ukraine. 
    ‘The only apparent purpose of this cut in oil supplies is to help the Russians and harm Americans. It was unprovoked and unforced, as an error,’ the Connecticut senator, Richard Blumenthal, said. His statement was echoed by his Democrat colleague from California, Ro Khanna, who said: ‘When Americans are facing a crisis because of Putin, when we’re paying more at the pump, our ally, someone who we have helped for decades, should be trying to help the American people.’
    The Biden administration said it was reviewing its ties with the Gulf kingdom. 
    Speaking to CNN, however, a Saudi minister, Adel al-Jubeir, said: ‘Saudi Arabia does not politicise oil. We don’t see oil as a weapon. We see oil as our commodity. Our objective is to bring stability to the oil market.’ Riyadh is not partnering with Russia, he added

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    Workers are being punished for inflation. The real culprit is corporate greed | Robert Reich

    Workers are being punished for inflation. The real culprit is corporate greedRobert ReichBig corporations are using inflation as cover to raise prices. Yet the US Federal Reserve is raising interest rates – further hurting Americans The US Federal Reserve is aiming its powerful firehose at the living room but it’s the forest that’s ablaze. As a result, people may drown even as their house catches fire.This about sums up the sorry state of inflation-fighting in America.On Wednesday, the Fed – America’s central bank – raised interest rates by three-quarters of a percentage point, and signaled more rate increases to come, perhaps as soon as September.This followed a quarter-point increase in March, another half a point in May, and three-quarters of a point in June.On Thursday, the commerce department announced that the US economy had shrunk for the second quarter in a row.While not technically a recession (economists in and out of the White House have spent much of the last several days deconstructing the word “recession”), there’s no question but that the US economy is slowing.This, to put it mildly, makes no sense.Inflation has broken out all over the world – the consequence of pent-up demand from more than two years of pandemic and of limited supplies of everything from computer chips to wheat, due to difficulties getting the world economy up and running.Add in Putin’s war in Ukraine driving up world energy and food prices, and China’s lockdowns against Covid, and you get a perfect conflagration.That’s not all. Big corporations are busily raising their prices because consumers have so little choice. Corporations are using inflation as cover.Prices at the gas pump have drifted down a bit in the last month but are still eye-popping. (Here in California, I’m paying over $6 a gallon.)At the same time, big oil has hit a gusher. Exxon just reported second-quarter profits of $17.9bn, more than three times what it earned a year ago. Chevron’s profit more than tripled to $11.6bn.The two giant American oil companies aren’t pouring their profits back into energy, green or otherwise. They’re buying back their shares of stock to reward investors and executives.Or consider giant corporations selling consumer staples, such as Proctor & Gamble (maker of everything from Gillette razors to Tide detergent).On Friday, P&G reported another quarter of rising profits despite the increasing costs of raw materials and transportation. How did it manage this feat? By raising its prices even more.Meanwhile, half of the recent rise in grocery prices is from beef, pork and poultry. Just four large conglomerates control these markets, and they’ve been coordinating their price increases to score large profits – here again, using “inflation” as an excuse.If markets were competitive, companies would keep their prices down to prevent competitors from grabbing away customers. But they’re raising prices even as they rake in record profits.The Fed’s firehose is hitting none of this.Meanwhile, we’re told not to worry because the labor market is doing just fine.Rubbish.There are two aspects to the labor market – jobs and wages. The number of jobs has been increasing nicely. Let’s hope this continues. But hourly wages have plummeted, when adjusted for inflation.If the Fed keeps raising interest rates – even if the national economy avoids an official “recession” – most workers will fall even further behind.The living standards of nearly everyone who borrows money are already dropping. Because of the Fed’s rate hikes, the average rate on credit card debt has reached 17.25% (up from 16.34% in March, before the Fed began raising interest rates). Rates on student loans, car loans and mortgages are also rising.The government should use a firehose better aimed at the conflagration, which won’t so badly burden the bottom 80%.For starters, impose a temporary windfall profits tax on big oil, on giant sellers of consumer staples and on big ag. This would reduce their incentive to engage in price gouging.Bolder antitrust enforcement – even the threat to block mergers and break up giant companies – could also reduce their ardor to raise prices.If Congress refuses to allow the government to use its bargaining power to reduce the prices of pharmaceuticals, big pharma is a good candidate for temporary price controls. (FDR controlled prices via executive order.)Finally, higher taxes on the wealthy – such as Democrats seem finally ready to enact – will help dampen total demand, thereby dousing some of the inflation fire.The Fed’s single tool for fire-fighting – interest-rate increases – is aimed in the wrong direction. It’s hitting working people rather than corporations responsible for most price increases (over and above the rising costs of global supplies).We need to fight rising prices, not working people.
    Robert Reich, a former US secretary of labor, is professor of public policy at the University of California at Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
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    Democrats announce plans to ‘go after’ big oil in effort to bring down prices

    Democrats announce plans to ‘go after’ big oil in effort to bring down pricesNancy Pelosi says oil companies ‘hoarding the windfall while keeping prices high at the pump’ amid concerns over US inflation The Biden administration is to propose legislation that would allow US federal and state agencies to “go after” oil companies on wholesale and retail sales practices, lambasting the industry over price gouging and profiteering.As American voters express increasing concerns about the high prices of a wide range of consumer goods, including energy and food, Senate majority leader Chuck Schumer said passing legislation to bring down retail gasoline prices “is at the very top of our list”.‘We’re not attacking Russia,’ Biden says as he asks for $33bn in Ukraine aid – liveRead moreNeither Schumer nor House speaker Nancy Pelosi would say when such legislation will be voted upon, or how much money it could end up saving consumers if enacted into law.“Big oil has profiteered and exploited the marketplace,” Pelosi told reporters, noting companies’ strong corporate profits over the past year. “They are hoarding the windfall while keeping prices high at the pump,” she added.The move comes as gas prices have surged in the wake of Russia’s invasion of Ukraine. Despite recent falls, the average price of a gallon of gas is now over $4 in the US, up from $2.88 a year ago, according to the American Automobile Association.Oil companies have enjoyed record profits as prices have soared. Exxon, the largest US oil company, is expected to report record earnings on Friday and rival Chevron recently reported “the best two quarters the company has ever seen”.Pelosi said the White House had discussed a “holiday” for Federal gas taxes but said that there was no evidence that oil companies would pass those savings on to consumers.Oil companies are not alone in reporting huge surges in profits even as consumers face higher bills thanks to soaring inflation. An analysis of 100 leading US companies found their net profits had risen by a median of 49%, and in one case by as much as 111,000%. The increases came even as prices rose and average wage increases were eroded by rising inflation.Reuters contributed to this storyTopicsOil and gas companiesUS politicsBiden administrationInflationEconomicsEnergy industrynewsReuse this content More

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    Big oil could bring US gas prices down but won’t – so hit it with a windfall tax | Robert Reich

    Big oil could bring US gas prices down but won’t – so hit it with a windfall taxRobert ReichIn the US, in times of crisis, the poor pay the price and the rich cash in. Democrats know it doesn’t have to be this way This morning I filled my car with gas, costing almost six dollars a gallon. My car is a Mini Cooper I bought years ago, partly because it wasn’t a gas-guzzler. Now it’s guzzling dollars.Putin and Trump have convinced me: I was wrong about the 21st century | Robert ReichRead moreWhen I consider what’s happening in Ukraine, I say what the hell. It’s a small sacrifice.Yet guess who’s making no sacrifice at all – in fact, who’s reaping a giant windfall from this crisis?Big oil has hit a gusher. Even before Vladimir Putin’s war, oil prices had begun to rise due to the recovery in global demand and tight inventories.Last year, when Americans were already struggling to pay their heating bills and fill up their gas tanks, the biggest oil companies (Shell, Chevron, BP, and Exxon) posted profits totaling $75bn. This year, courtesy of Putin, big oil is on the way to a far bigger bonanza.How are the oil companies using this windfall? I can assure you they’re not investing in renewables. They’re not even increasing oil production.As Chevron’s top executive, Mike Wirth, said in September, “We could afford to invest more” but “the equity market is not sending a signal that says they think we ought to be doing that.”Translated: Wall Street says the way to maximize profits is to limit supply and push up prices instead.So they’re buying back their own stock in order to give their stock prices even more of a boost. Last year they spent $38bn on stock buybacks – their biggest buyback spending spree since 2008. This year, thanks largely to Putin, the oil giants are planning to buy back at least $22bn more.Make no mistake. This is a direct redistribution from consumers who are paying through the nose at the gas pump to big oil’s investors and top executives (whose compensation packages are larded with shares of stock and stock options).Though it’s seldom discussed in the media, lower-income earners and their families bear the brunt of the burden of higher gas prices. Not only are lower-income people less likely to be able to work from home, they’re also more likely to commute for longer distances between work and home in order to afford less expensive housing.Big oil companies could absorb the higher costs of crude oil. The reason they’re not is because they’re so big they don’t have to. They don’t worry about losing market share to competitors. So they’re passing on the higher costs to consumers in the form of higher prices, and pocketing record profits.It’s the same old story in this country: when crisis strikes, the poor and working class are on the frontlines while the biggest corporations and their investors and top brass rake it in.What to do? Hit big oil with a windfall profits tax.The European Union recently advised its members to seek a windfall profits tax on oil companies taking advantage of this very grave emergency to raise their prices.Democrats just introduced similar legislation here in the US. The bill would tax the largest oil companies, which are recording their biggest profits in years, and use the money to provide quarterly checks to Americans facing sticker shock as inflation continues to soar.It would require oil companies producing or importing at least 300,000 barrels of oil per day to pay a per-barrel tax equal to half the difference between the current price of a barrel and the average price from the years 2015 to 2019.This is hardly confiscatory. Those were years when energy companies were already recording large profits. Quarterly rebates to consumers would phase out for individuals earning more than $75,000 or couples earning $150,000.Republicans will balk at any tax increase on big oil, of course. They and the coal-industry senator Joe Manchin even tanked the nomination of Sarah Bloom Raskin to the Fed because she had the temerity to speak out about the systemic risks that climate change poses to our economy.But a windfall profits tax on big oil is exactly what Democrats must do to help average working people through this fuel crisis. It’s good policy, it’s good politics and it’s the right thing to do.
    Robert Reich, a former US secretary of labor, is professor of public policy at the University of California at Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
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    Manchin thwarts Biden’s climate plan: Politics Weekly Extra

    As Joe Biden gears up for his trip to Glasgow for the Cop26 summit, Senator Joe Manchin continues to try to water down the reconciliation bill, which as it stands includes transformational provisions to stem the adverse affects of the climate crisis. Joan Greve and Oliver Milman look at the potential fallout for the world if Manchin gets his way

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    Joe Manchin leads opposition to Biden’s climate bill, backed by support from oil, gas and coal

    US CongressJoe Manchin leads opposition to Biden’s climate bill, backed by support from oil, gas and coal West Virginia senator objects to bill that would steadily retire the coal industry which continues to provide ample financial support to himOliver Milman@olliemilmanWed 20 Oct 2021 06.00 EDTLast modified on Wed 20 Oct 2021 13.28 EDTIn the tumult of negotiations over the most consequential climate legislation ever proposed in the US, there is growing scrutiny of the fossil fuel industry connections of the man poised to tear down the core of the bill – the West Virginia senator Joe Manchin.Manchin, a centrist Democrat, has objected to key provisions of a multitrillion-dollar reconciliation bill that would slash planet-heating emissions and help the US, and the world, to avert catastrophic climate breakdown. In a finely balanced Senate, Democrats need all 50 of their senators to vote for the bill, with no Republicans willing to vote for the climate measures.The legislation would steadily retire the coal industry that once formed the backbone of the West Virginia economy and continues to provide ample financial support to Manchin, who has spent the past four decades as a political heavyweight in his Appalachian home state, including acting as its secretary of state, governor and now US senator.Chart showing Joe Manchin has received the largest donations across multiple energy sectorsIn the current electoral cycle, Manchin has received more in political donations from the oil and gas industry than any other senator, more than double the second largest recipient. He is also the No 1 beneficiary of donations from the coal mining sector, leads the way in money accepted from gas pipeline operators, and is sixth in the ranking of senatorial donations from electricity utilities.This industry largesse has led to accusations that the senator has been unduly influenced by the companies that have helped stoke the climate crisis. Manchin’s office did not respond to a request for comment.But Manchin’s ties to the fossil fuel industry run deeper than political donations. After initially working in his family’s furniture and carpet business, Manchin set up a coal brokerage firm called Enersystems in 1988, running it until he became a full-time politician.The majority of Manchin’s assets are in a coal brokerage firm’s stockDespite handing control of Enersystems to his son Joseph, Manchin’s links to the business have proved fruitful to the senator. His shares in Enersystems are worth between $1m and $5m, according to his latest financial disclosure document, with the senator receiving more than $5m in dividend income from the company over the past decade. The coal brokerage represents 71% of Manchin’s investment income, and about a third of his total net worth.The reconciliation bill contains a huge expansion in tax support for clean energy and electric vehicles and new curbs on methane, a potent greenhouse gas, but the core of the climate measures is something called a Clean Electricity Performance Program (CEPP). The $150bn scheme would use payments and penalties to spur utilities to phase out fossil fuels from the US electricity system over the coming decade.The program, along with the clean energy tax credits, “are the best shot we’ve had in a generation to supercharge the clean energy transition and reduce fossil fuel pollution in marginalized communities”, said Patrick Drupp, deputy legislative director of the Sierra Club.Manchin has called the bill’s spending “reckless” and said it “makes no sense” to pay utilities to increase their share of renewable energy when they are doing so already. This is despite the fact that barely any utilities across the US are adding solar, wind and other sources of clean energy at the rate envisioned by the bill to force emissions down quickly enough to stave off climate disaster.“His statement on this is demonstrably false. Utilities aren’t growing renewables that quickly, certainly not in West Virginia,” said Robbie Orvis, senior director of energy policy design at Energy Innovation. “It’s not a secret he has ties to the coal industry. One would hope anyone elected to Congress would not hold significant financial holdings in industries they would consider regulating, but that’s the system we have, unfortunately.”Recent analysis by Energy Innovation found that the CEPP is the “carbon reduction lynchpin” of the legislation, representing around a third of the emissions cuts that would come from the bill. “It’s really unfortunate that the CEPP is not on the table anymore,” said Orvis. “But this bill would still result in a huge cut in greenhouse gas emissions, it does a lot. There may be a way to fill the gaps left by CEPP.”Projected emission reductions of Build Back Better programs by 2030Joe Biden has set a goal for the US to cut its planet-heating emissions in half this decade, before zeroing them out by 2050. America is currently on track for a 17% to 25% cut in emissions by 2030, an analysis released on Tuesday by Rhodium Group found, leaving up to 2.3bn tons of emissions left to eliminate in order to meet the goal. John Larsen, director of Rhodium Group, said that with further cuts from the federal government and states, “the US’s ambitious 2030 climate target is within reach, even with a more limited policy package from Congress”. But he added: “The US and the world have little time or room for error to avoid the worst impacts of climate change.”TopicsUS CongressOil and gas companiesCoalOilUS politicsFossil fuelsEnergy industrynewsReuse this content More

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    The Louisiana gas industry’s answer to lax safety enforcement? Loosen it more

    When a natural gas pipeline fire south-west of New Orleans killed one worker and burned three others, the Louisiana state police ordered Phillips 66 to pay a $22,000 fine for failing to immediately report the incident. The fire burned for four days before first responders could put it out.But the company ultimately didn’t pay any police fine, ending up with just a warning.That story is common, according to public records reviewed by the Louisiana Illuminator and Floodlight with the Guardian. The Louisiana state police – which oversees pipeline safety – issued 34 fines and five warning letters in the past five years. A quarter of those penalties were reduced: three were lowered, five were replaced with warning letters and two were dismissed. The fines that did stick were low, between $2,250 and $8,000.Aside from the obvious potential harms to workers, gas leaks pose fire risks and can cause respiratory problems for people in nearby communities.Phillips 66 declined to comment for this story. The company was separately fined $20,000 over the incident by the department of natural resources.Despite the record of lax enforcement by the state police, gas companies in the state say they are being treated unfairly and have lobbied for legislation to loosen requirements around reporting pipeline leaks. Louisiana has more gas pipelines than any other state except Texas, and more gas pipeline projects are planned in the state to support the growing demand for US natural gas exports.The proposal, House Bill 549 from Louisiana’s Republican representative Danny McCormick, was approved by Louisiana lawmakers and has been sent to the Democratic governor John Bel Edwards’ desk. It is one of many efforts by the influential oil and gas industry to avoid regulation and keep its tax rates low in the state. If signed into law, it would absolve companies from reporting natural gas leaks of less than 1,000 pounds, unless they cause hospitalization or death.Gene Dunegan, the program manager for Louisiana state police’s emergency services unit, defended the department’s record on fines, saying it had reduced them when pipeline companies present reasonable explanations for failing to report them within an hour. While Louisiana law requires pipeline companies to “immediately” report leaks, it does not define a deadline for doing so. The state police ask companies to report incidents within an hour.“Our goal is not to collect monies, but to keep the violation from recurring,” Dunegan said. “Most [companies] are proactive and implement needed changes and training prior to hearing from us, others not so much.”The state police issued few tickets over the past five years – less than 10 a year on average. One pipeline company’s name appears on the list more than any other: Centerpoint Energy. The company was ticketed seven times over the past three years, totaling $38,750.Trey Hill, a lobbyist representing Centerpoint, helped push McCormick’s bill through the Louisiana legislature. Centerpoint contested a ticket for failing to notify state police of one natural gas release, but state police dismissed the fine before a judge could decide on the case, Hill said in a legislative meeting in April. Atmos Energy, which was fined by Louisiana state police twice in 2020, also supported McCormick’s bill.Louisiana was among the first states to make trespassing on pipelines a felony, which pipeline companies have used to target environmental protesters and journalists. A federal judge recently allowed a challenge to Louisiana’s anti-protest pipeline law to move forward.Pipeline incidents are already underreported, said Anne Rolfes, the director of Louisiana Bucket Brigade, an environmental organization that opposed the Bayou Bridge pipeline. “These accidents are overlooked, business as usual,” she said.In other states, the leaks are often overseen by energy regulators. In Oklahoma, for example, violations are enforced by the state’s Corporation Commission, but the highway patrol can also file charges against companies.In Louisiana, the department of natural resources’ pipeline division regulates only much larger gas leaks in intrastate pipelines that carry toxic or flammable products. “Our role is to conduct an investigation after the fact,” Steven Giambrone, the pipeline division director, said in the April committee hearing. “We’re not a first responder.”John Porter, the commander of the emergency services unit of the Louisiana state police, warned lawmakers that looser reporting thresholds could trigger public health concerns when smaller leaks happen in populated areas.“If we have a gas leak at a major intersection, 1,000 pounds would be an extreme amount with vehicles traveling by, with pedestrians traveling by,” he said. “And all we’re asking is for notification for us so we can get the proper emergency services people out there to protect the public.” More