Bain Capital, Capitalism, Chinese Slave labor, Climate Change, Corporate State, Corporatocracy, Drill Baby Drill, Environmental Collapse, Financial Elite, Foxconn, Gross Inequality, Inverted Totalitarianism, Mitt Romney, Off-Shoring, Peak Oil, The Elite 1%, U.S. Domestic Oil Production, Wall Street Fraud
On the Labor front….
I came across the above video yesterday evening. It’s a recording of Mitt Romney recounting his days at Bain Capital when he was off-shoring U.S. manufacturing to slave labor camps in China. From the video I’m assuming that America’s gift to the world, as Romney refers to it, is neoliberal capitalism and the privilege that economic system brings to the masses who can enjoy working for pennies per hour in a sweatshop factory complete with dormitories holding “12 girls per room”, all of which is enclosed by barb-wired fencing. And as Romney relates, the fences are to keep the hoards of people out who are dying to fill a position in the factory as soon as someone falls over. For Romney and the typical vulture capitalist, this is a wet dream: endless numbers of cheap laborers ready to fill assembly-line positions which are unencumbered by unions, safety regulations, and basic rights for workers. In such factories humans are reduced to cattle in order to extract the maximum profit. A Foxconn executive expressed the general sentiment of corporate capitalists when he referred to his workers as “animals” earlier this year. Despite recent reports by the Fair Labor Association (FLA) on the heels of an eye-opening report on labor conditions, the reality on the ground, as Romney can attest to from his days at Bain, is the same as it ever was:
As reported here, China Labour Watch is claiming that bribery is undermining the audit system. China Labour Watch founder Li Qiang has not minced his words: “Although the working hours at Foxconn have been reduced to less than 60 hours per week, the intensity of the hourly work has been increased. According to our follow-up investigation, the workers have to complete the workload of 66 hours before within 60 hours now per week. As a result, the workers get lower wages but have to work much harder and they are not satisfied with the current situation. The harsh working conditions are by no means isolated to just Foxconn but exist throughout Apple’s supply chain. However, that report only focused on Foxconn factories. It is Apple’s entire supply chain system that should be responsible for the squeezing of workers.”
On the Energy Front:
King Romney is going to double down on fossil fuels in America, further dismantling regulations and awarding more tax breaks for Big Oil:
Romney unveiled his energy plan, which makes no mention of climate change and focuses on reaching energy independence by 2020 through increased extraction and use of oil, gas and coal, accompanied by reduced regulation for these industries.
The plan underlines the fact that the Republican Party and the oil, gas and coal industries, long in agreement on policy and ideology, have grown closer than ever before. Romney, whose top energy adviser is the wealthiest oilman in the country, is on pace to raise more money from these industries than either George W. Bush or Sen. John McCain (R-Ariz.) did when he ran for president. The industries are also pumping millions into the new unlimited money vehicles, super PACs and dark money nonprofits, that are spending tens of millions of dollars per month to influence the election…
…A central part of the plan is taking the power to permit and license new onshore drilling on federal lands out of the hands of the federal government and putting it into the hands of the states. That means that states like Alaska or North Dakota, which is enjoying a massive oil boom under the current regulatory regime, would be able to allow drilling on federal lands with no oversight from Washington.
North Dakota stands out, in particular, as it is where Romney’s top energy adviser, oil billionaire Harold Hamm, is making his fortune. Hamm, whose stump speech is only three words, “Beat Barack Obama,” has given $985,000 to Restore Our Future and raised money for the Romney campaign. He would profit greatly from this change in policy as his company, Continental Resources, would be freed to drill beyond the Bakken fields in North Dakota using techniques including hydraulic fracking and horizontal drilling….
…Among many other policies supporting the industry, Romney calls for a repeal of regulations limiting the amount of mercury, a hazardous pollutant, that can be emitted from coal and oil power plants…
Overlooking the catastrophic externality of climate change, notice that Romney is heralding America’s energy independence through his plan of ‘Drill, Baby, Drill’ of fossil fuels. If you look at the following graph, you’ll see that there is no amount of drilling we could do within America to achieve fossil fuel energy independence:
As you can see, America hit peak oil around 1970 at 9.637 mbpd (million barrels per day), as predicted by Hubbert, and then in 1993 America’s domestic oil production was surpassed by consumption, a point from which we have never recovered. Even with the recent drastic drop in consumption due to an anemic economy, we are still importing around 10 to 11 MBPD while domestic production is somewhere between 7 to 8 MBPD. Domestic production would have to double from the current rate or total consumption, which sits currently at roughly 18 to 19 MBPD, would have to be halved while allowing for the requisite economic growth that we worship. That’s not going to happen. As Loren Steffy explains, “U.S. oil production gains are like water pumps on the Titanic“:
…The much-ballyhooed increase in U.S. production simply isn’t enough to have a meaningful effect on global oil prices, which doubled from 2005 to 2011. That ultimately is the biggest factor in setting prices for retail gasoline.
U.S. production gains look impressive, but much of it offsets declines earlier in the decade because of major hurricanes that disrupted offshore and Gulf Coast facilities. Domestic production was 7.5 million barrels a day in 2010, according to the Energy Information Administration, and that number probably increased to about 7.7 million barrels last year, estimates Jeffrey Brown, an independent petroleum geologist in Fort Worth who writes frequently on oil issues.
In 2004, before the spate of hurricanes, production was 7.2 million barrels. That means domestic production hasn’t increased more than about 500,000 barrels a day despite the fracking binge and other efforts to encourage drilling. During the same period, net exports for all countries in North America — including Canada, Mexico and Venezuela, some of our biggest suppliers — fell by 1.4 million barrels, or 23 percent, according to Brown’s analysis.
Brown compares the situation to water flowing into the Titanic after it hit the iceberg.
“Let’s assume that water is pouring into the ship 10 times faster than than water is being pumped out,” he said. “The water being pumped out is analogous to the slow increase in U.S. crude oil production. The water flowing in is analogous to declining annual net exports. Guess which metric most people seem to be focused on?”
That doesn’t even account for China, India and other rapidly developing countries, whose oil imports are rising sharply, increasing the competition for oil with countries like the U.S.
“So, while slowly increasing U.S. crude oil production is very important, the dominant trend we are seeing is that developed oil importing countries like the U.S. are being gradually priced out of the global market for exported oil,” Brown said…
King Romney, nevertheless, will use the rallying call of his energy plan to increase domestic oil production, with its attached gifts of even more environmentally destructive deregulation and kleptocratic giveaways to Big Oil from the taxpayer, as a reason for voters to put him into the White House. But as pointed out at Fair.org, this is all a smokescreen manipulating public perception:
With gasoline prices again approaching $4 a gallon, Mr. Romney, the presumptive Republican nominee, is also trying to merge energy and economic policy in a way that will make voters see increased energy production as a pocketbook issue.
Note that Lipton and Krauss don’t say that increased U.S. energy production will actually affect the $4-a-gallon price of gas and hence the voters’ pocketbooks; that would be inaccurate, since oil is a global commodity and it’s impossible for the U.S. to increase its production enough to change it substantially. In fact, with the formulation “in a way that will make voters see,” the Times reporters suggest that they are well aware that increased oil drilling will not actually alter gas prices–that this is a matter of changing public perceptions, not economic realities.
But then, Lipton and Krass don’t do anything in their piece to let the reader know that the implied connection between increased drilling and lower gas prices is fraudulent…
The doublespeak used by politicians of all stripes to bend reality is the same as it ever was.