This is primarily a travel blog in which I write about traveling in our motorhome. Our travels have

Nacogdoches, TX, United States
I began this blog as a vehicle for reporting on a 47-day trip made by my wife and me in our motorhome down to the Yucatan Peninsula and back. I continued writing about our post-Yucatan travels and gradually began including non-travel related topics. I often rant about things that piss me off, such as gun violence, fracking, healthcare, education, and anything else that pushes my button. I have a photography gallery on my Smugmug site (http://rbmartiniv.smugmug.com).

Saturday, December 27, 2014

What Did Congress Leave Under Your Tree?

Get comfortable, this one is a little long.

Christmas is over and Congress, as usual, is on vacation. Let’s take a look at what Congress left under our tree before they beat it out of town.

Wow, it looks like something really, really big! Let’s unwrap it. Aw shucks, it’s just a big stack of paper, over 1600 pages of a new $1.1 trillion spending bill. But at least it will keep the country operating until October 2015.

Nobody really knows what’s included in the entire bill because no one has actually read the entire bill. However, a lot of people have read parts of it and have commented on what they like and don’t like about the bill. I read a lot of these reviews and pulled out a few things that caught my eye. These provisions make up only a very small portion of the bill so you may be able to find a lot more weirdness than I if you look through it. I would like to share what I found with you:
·      There was some give and take with small businesses. The “give” was a bone tossed to them exempting small businesses from commercial trucking regulations related to “truck weight limitations, truck driver hours of service, and hazardous material permitting. So watch out for that overweight truckload of no-permit-required hazardous substances whose driver can now log 82 hours of driving time a week.
·      The “take” from small businesses is that the Defense Logistics Agency has redefined a small business from one having a maximum of 500 employees to one having a maximum or 1000 employees. So what, you say? The DLA did this in order to force lower prices for stuff they buy for the military. How? By increasing competition for small businesses.
·      Farmers also received a little help with Congress cutting the EPA’s budget by 20%. Now the EPA won’t be able to enforce the Clean Water Act as it applies to ponds and irrigation canals. Farmers can dirty up the water all they wish to.
·      Congress reduced the Department of Education funding by about $133 million. Apparently our illiterate students are smart enough for Congress.
·      You know those Wall Street “too big to fail” financial institutions that we swore we would never bail out again? Well, Congress is looking after those fat cats by promising that the FDIC (aka the taxpayers) will bail them out should they fail as a result of the extremely high-risk derivatives trading (whatever that is) they are doing. Nobody is quite sure who actually wrote this part of the bill, but the provision is suspiciously almost word-for-word as that suggested by the Citigroup lobbyists. There are 196 lobbyists’ reports on file requesting this guarantee from Congress.
·      Anybody out there living on a pension? Well, unions can now cut pension plan benefits by as much as 60% pre-emptively by as many as 19 years into the future to protect the plan from insolvency.
·      The ultra-rich can buy even more government now that the maximum contribution to a national political party has been increased from $97,200 per individual per year to $777,600 per individual per year.
·      Now that we seem to have plenty of “cheap” oil again, Congress has decided to shift some of the funding for renewable energy research over to fossil-fuels research and development. The oil and gas industry has a lot more money and lobbyists than do the forward-thinking environmentalists.
·      Because of the lobbying efforts on behalf of the coalmine owners, the bill now authorizes the Export-Import Bank of the US to fund coal-fired power plants. That’s really going to help reduce our carbon footprint.
·      Congress decided to prohibit implementation of the International Arms Trade Treaty, which would have established common standards for the international trade of conventional weapons in an attempt to reduce the illicit international arms trade. I suppose the NRA was afraid the treaty might somehow infringe on the right to arm one’s self to the teeth. I guess it could do that if you were arming yourself with illegal weapons from the international market.
·      Congress has decided not to close the Guantanamo Bay Detention Facility and move the prisoners to prisons in the US, even though tons of money would be saved. Of course, it would be more difficult to torture the prisoners if they were on US soil.
·      To keep some of their constituents happy, Congress is barring the Department of Agriculture from closing or consolidating redundant Farm Service Agency offices. Again, why would they want to save money?
·      Over the protests of the Department of Defense, Congress, in its infinite wisdom, has seen fit to dump an extra $4 billion into the Defense budget for tanks and airplanes the Department says it doesn’t need. The Army got an extra $120 million for the M1 Abrams Tank Upgrade Program even though the Army Chief of Staff told them that the Army has more than enough tanks, including 2,000 sitting idle in the California desert. Of course, the M1 tank has suppliers across numerous congressional districts. In the past ten years there have been 37 earmarks (pork) for the M1 program, costing taxpayers over $788 million.
·      At least $8 billion of the Pentagon’s budget is devoted to a single aircraft, the F-35 Joint Strike Fighter. The aircraft has been nothing but a problem and is fast becoming the most expensive weapons system in Pentagon history. This program is number one on the GAO (Government Accountability Office) annual report of “at-risk” Pentagon development programs. The F-35 is ten years late being put in service and total cost is around $400 billion so far. The 2001 estimate was $233 million. The additional money has gone to contractors to pay for additional research and redevelopment of goals set by the Pentagon that the contractors failed to meet. I didn’t realize that failure to meet contractual goals resulted in bonuses for everybody. In the real world the contractor would more than likely pay a penalty.
·      Congress has also provided the Defense Department with a “slush fund,” which is exempt from spending caps that apply to the rest of the government. Does that mean they can spend as much as they want, even though they said they didn’t need the extra $4 billion?
·      To help pay for the extra $4 billion and the unlimited slush fund, Congress has slashed the planned military pay raise from 1.8% down to 1%, they have increased military prescription co-pays, and decreased the military housing allowances. That’s thanking the military for a job well done over in those shit holes!
·      Congress set aside $65 million for the Center for Domestic Preparedness, Homeland Security’s Weapons of Mass Destruction training center in Anniston, AL. If you are a state, local, or tribal government emergency responder your training will be completely funded by Homeland Security, including all transportation, meals, and lodging costs.
·      $25 million is provided to the National Pre-Disaster Mitigation Grant Program. This program provides funds for hazard mitigation planning and projects that should, supposedly, reduce local, state, and tribal governments’ reliance on federal funding if an actual disaster were to occur.
·      Funding was cut for the Independent Payment Advisory Board, the group charged with achieving cost savings for Medicare. Healthcare doesn’t cost enough?
·      In a flash of brilliant insight, Congress added $5 million to the $12 million LEFT OVER from previous years for abstinence education. Since 1966, more than $1.8 billion has been spent on abstinence education in the US. And, believe it or not, he rate has actually dropped. From a birth rate of over 90 per 1,000 teenagers in 1960 to just a little over 25 per 1,000 teenagers in 2013. Could the fact that oral contraceptives became available in 1962 have had anything to do with this decrease, or was it indeed due to abstinence education?
·      The Christopher Columbus Fellowship Foundation received a paltry $150,000. This program provides cash awards to outstanding individuals and groups, primarily middle and high school students, who innovate ways to serve their communities. If it is such a good thing, why only $150,000?
·      There is a provision for $5.5 billion to combat Ebola, with nearly 90% of the money going directly to Africa (probably war lords and such). There are no accountability safeguards to prevent corrupt misuse of the money. This is more money than the US spends annually on cancer research, it is double the aid to Israel, and it is five times what WHO (World Health Organization) said was needed.
·      The bill provides $1 billion in “war funds” for a “European Reassurance Initiative: to enhance our military’s presence in Europe,” where we are not at war. This will allow us to deploy more troops in Europe, including Poland, Georgia, Moldova, and Ukraine among other countries. Maybe we can get a war started over there.
·      Congress is providing Egypt, a Muslim country run by a military dictator “President,” with $1.3 billion in military aid and $150 million in economic aid. Egypt bars US citizens who bad-mouth their “President” from entering their country. Unless, that is, he happens to be carrying the $1.3 billion check!
·      Another Muslim country, Jordan, is being given $1 billion in military and economic aid plus additional funding for refugee assistance.
·      To make sure that Egypt and Jordan don’t go crazy with our military assistance money, Congress is giving Israel $3.1 billion in overall aid plus $619 million in military aid. This is in addition to the $225 million we gave them a few months ago.
·      For all you yachtsmen out there, you will be happy to know that your next cruise out to Catalina Island should be more pleasant as a result of the $8 million Congress is giving California to dredge the channel for pleasure boats.
·      Not forgetting themselves, Congress has granted themselves an extra $1,000 per year to help cover their luxury car allowance.
·      Congress has also renewed a Nevada travel promotion program championed by Harry Reid and the Las Vegas casinos.
Just in case you didn’t realize how well our US Representatives and Senators are supported in their lavish lifestyles (even though the majority of them were millionaires before being elected to Congress), here is a partial list of what is included in their compensation packages:
·      Annual base salary of $174,000
·      Only 112 work days in 2014 (averages over $1,500 per day)
·      Free airport parking
·      Free on-site gym for House members
·      Weakened insider trading restrictions
·      Health-care subsidies under Obamacare despite making more than four times the poverty level
·      A better retirement plan than Social Security ($59,000 annual pension after 20 years service)
·      Most of their flights to and from their home states are funded by taxpayers.
·      The family of a Congressman killed while in office receives $174,000 while the family of a U.S. serviceman killed in action only receives $100,000
·      Members of the House receive a $900,00 annual allowance for a staff plus a $250,000 annual allowance for travel and office expenses while each Senator gets an annual budget close to $3.3 million
Unfortunately, it seems that the U.S. taxpayers still can’t match the rewards from corporate lobbyists, as our Congressmen seem to listen to them more than to their constituents. Like they say, we have the best Congress money can buy!

Friday, December 19, 2014

Econ 101...The Law of Supply and Demand

Yesterday, near Terrell, TX, I filled my car’s gas tank for ONLY $1.99 a gallon. That sounds cheap doesn’t it? I suppose it does to those of you a little younger than I. The problem is, I can still remember paying less than 25 cents a gallon for gasoline. I am not an economist and will not or cannot presume to make any economic predictions. But I did take Econ 101 in college and can make a few comments on what happened.

We know that the price of oil has dropped tremendously. Here are a few facts. Yesterday, December 18, the median price was right at $57 per barrel. Back in June the price of oil was around $115 per barrel and most of this decade has seen oil prices hovering around $100 per barrel. In 2008, the U.S. oil production was 5 million barrels a day. By November of this year production was 9 million barrels per day, almost double that of 2008. The price of oil in 1998 was only $17 per barrel.

So, why has the price of oil crashed? All you really need to know comes from Econ 101 and is known as the Law of Supply and Demand, which I do not believe has been rescinded. There are four parts to this Law:

1.     If demand increases and supply remains unchanged, a shortage occurs, leading to higher prices.
2.     If demand decreases and supply remains unchanged, a surplus occurs, leading to lower prices.
3.     If demand remains unchanged and supply increases, a surplus occurs, leading to lower prices.
4.     If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher price.

So, for the answer to what happened all one needs to do is to look at the four parts of the Law. Specifically, read part 4. Supply outstripped demand, leading to lower prices That’s right, high oil prices had the oil and gas companies pumping and hydraulic fracturing, or fracking, as hard as they could. They were making a killing at those prices (just check their stock prices). Unfortunately for them, this created the oil glut in which they currently find themselves. They simply produced more oil than we were using or were willing to purchase.

Is this good or bad? That depends on who you are. Obviously, if you are dependent upon the profits of the oil and gas industry, it is not so good. On the other hand, if you are a farmer, trucking company, airline, railroad, or customer of any of these businesses, then the crash in the price of oil is a good thing. A drop in manufacturing and transportation costs could lead to a drop in retail prices, which would benefit all consumers.

From a strictly personal point of view, one of the best things that could result from these lower oil prices would be the death of fracking. Fracking is a severe threat to the ecology of the earth. It pollutes the air, soil, and water. It also requires millions of gallons of fresh water per well and that water is lost forever. Fracking renders the water too toxic to be recycled for reuse. Large portion of the U.S. oil producing areas  are currently in the third or fourth year of one of the most severe droughts on record. We should not be destroying this precious, life-sustaining, and irreplaceable resource.

The cost to pump oil from a fracked well in the U.S. today is about $65 per barrel. The industry can’t continue to pump oil at a cost of $65 per barrel and sell it for $57 per barrel and stay in business (I learned that in Econ 101 also). However, fracking will continue as long as the price of oil is high enough to cover the variable costs of pumping from wells already drilled, but once they have sucked the existing wells dry I do not imagine there will be many, if any, new wells fracked.

No one knows how long oil prices will remain low. But from your Econ 101 lesson you can guess what will, in all probability, occur eventually. If you aren’t sure, just check out part 4 of the Law of Supply and Demand.