SPIEGEL ONLINE
02/20/2009 10:44 AM
UBS
The End of Swiss Banking as We Knew it?
By Stanley Reed
Swiss bank UBS has ageed to provide the US government with the identities of and account information for certain American customers of UBS's cross-border business "who appear to have committed tax fraud or the like." As much as $14.8 billion in assets may be involved.
In 2005 I interviewed Peter Wuffli, then the CEO of Swiss Bank UBS. I asked him how he felt about Swiss bank accounts being used by citizens of other countries to hide funds from the taxman. This is how he responded:
Swiss banking giant UBS has agreed to turnover customer data to the US.
REUTERS/Stefan Wermuth
Swiss banking giant UBS has agreed to turnover customer data to the US.
"We have a very clear distinction between tax fraud, which is a criminal offense, and tax avoidance, which is not a criminal offense."
For UBS and other Swiss banks this sort of thinking has justified allowing the wealthy and not-so-wealthy of the world to use Swiss financial institutions to hide money away from the prying eyes of tax men everywhere.
Now, that lucrative practise, which has contributed richly to the cozy, lakeside splendor of Zurich and Geneva, the main Swiss banking centers, is very much under threat. Under a deferred prosecution agreement, UBS has ageed to provide the US government with the identities of and account information for, certain US customers of UBS's cross-border business "who appear to have committed tax fraud or the like."
UBS also has agreed to pay $780 million in disgorgement of profits from maintaining cross-border accounts, as well as unpaid taxes associated with fraudulent sham nominee and offshore structures.
According to a statement from the US Attorney of the Southern District of Florida in Miami, when UBS bought its Paine Webber brokerage in 2000, the bank voluntarily agreed to report to the Internal Revenue Service income for its US clients. Instead, the document says, certain UBS executives helped clients set up new accounts in the names of nominees and/or sham entities. This device was used by UBS to justify evading its reporting obligations, the statement says.
With a large US brokerage and investment banking business, UBS was extraordinarily reckless. These actions, knowledge of which seemed to go quite high if not to the top of the bank, put all of these activities in danger. "It is apparent that as an organization we made mistakes and that our control systems were inadequate," CEO Marcel Rohner said in a statement.
While its not clear how many accounts will be subject to this agreement, American clients must be quaking in their boots. Some have already been pursuing settlements with the IRS. Tax-evading clients from other countries, notably Germany, and the Swiss private banking industry that thrives on their stashed wealth must also be very worried. If the US can successfully pressure UBS into revealing sensitive information on clients, then other jurisdictions may also hope to be successful.
UBS is trying to limit the number of accounts it will be forced to reveal. The US government has filed a civil suit asking a court to order UBS to disclose all secret accounts of US customers. According to the lawsuit, as many as 52,000 US customers hid their UBS accounts from the government. As much as $14.8 billion in assets may be involved. UBS says it will fight the suit.
Peter Kurer, who took over as Chairman of UBS from Marcel Ospel last year commented: "Client confidentiality, to which UBS remains committed, was never designed to protect fraudulent acts or the identity of clients, who, with the active asistance of bank personnel, misused the confidentiality protections..."
Maybe so, but it is difficult not to think that UBS and other Swiss banks are more and more going to be forced to earn their living from providing superior wealth management and other services, not just rely on the attractions of secrecy. UBS has said in the past that it is committed to doing just that, but some of the bank's executives obviously couldn't resist the easy money available from aiding tax evasion.
Reed is London bureau chief for BusinessWeek.
URL:
* http://www.spiegel.de/international/business/0,1518,608866,00.html
Wednesday, February 25, 2009
Wednesday, February 18, 2009
Secret Society Skull & Bones Sued in Federal Court
Geronimo's kin sue Skull and Bones over remains
Wed Feb 18, 5:36 PM EST
Geronimo's descendants have sued Skull and Bones — the secret society at Yale University linked to presidents and other powerful figures — claiming that its members stole the remains of the legendary Apache leader decades ago and have kept them ever since.
The federal lawsuit filed in Washington on Tuesday — the 100th anniversary of Geronimo's death — also names the university and the federal government.
Geronimo's great-grandson Harlyn Geronimo said his family believes Skull and Bones members took some of the remains in 1918 from a burial plot in Fort Sill, Okla., to keep in its New Haven clubhouse, a crypt. The alleged graverobbing is a longstanding legend that gained some validity in recent years with the discovery of a letter from a club member that described the theft.
"I believe strongly from my heart that his spirit was never released," Harlyn Geronimo said.
Both Presidents Bush, Massachusetts Sen. John Kerry and many others in powerful government and industry positions are members of the society, which is not affiliated with the university.
After years of famously fighting the U.S. and Mexican armies, Geronimo and 35 warriors surrendered to Gen. Nelson A. Miles near the Arizona-New Mexico border in 1886. Geronimo was eventually sent to Fort Sill and died at the Army outpost of pneumonia in 1909.
According to lore, members of Skull and Bones — including former President George W. Bush's grandfather, Prescott Bush — dug up his grave when a group of Army volunteers from Yale were stationed at the fort during World War I, taking his skull and some of his bones.
Harlyn Geronimo, 61, wants those remains and any held by the federal government turned over to the family so they can be reburied near the Indian leader's birthplace in southern New Mexico's Gila Wilderness.
Their lawsuit also names President Barack Obama, Defense Secretary Robert Gates and Army Secretary Pete Geren as defendants.
"I want them to understand we mean business," said Harlyn Geronimo, who lives in New Mexico. "We're very serious. We're tired of waiting and we're coming after them."
Neither members of Skull and Bones, who closely guard their secrecy, nor the Russell Trust Association, the organization's business arm for tax purposes, could not be reached for comment.
Justice Department spokesman Andrew Ames said the government will "review the complaint and respond in court at the appropriate time."
Fort Sill spokeswoman Nancy Elliot declined to discuss the lawsuit, but said officials have always maintained there is no evidence supporting the descendants' claims.
Yale officials declined to comment Wednesday, saying they had not yet seen the lawsuit. Spokesman Tom Conroy noted the Skull and Bones crypt is not on Yale property.
Membership into Skull and Bones marks the elite of the elite at the Ivy League school. Only 15 Yale seniors are asked to join each year.
Members swear an oath of secrecy about the group and its strange rituals, which include devotion to the number "322" and initiation rites such as confessing sexual secrets and kissing a skull. The atmosphere makes Skull and Bones favorite fodder for conspiracy theorists.
Its most enduring story is the one concerning Geronimo's remains, and in 2005, Yale historian Marc Wortman discovered a letter written in 1918 from one Skull and Bones member to another that seemed to lend validity to the tale.
The letter, sent to F. Trubee Davison by Winter Mead, said Geronimo's skull and other remains were taken from the leader's burial site, along with several pieces of tack for a horse.
"The skull of the worthy Geronimo the Terrible, exhumed from its tomb at Fort Sill by your club and Knight Haffuer, is now safe inside the T — together with is well worn femurs, bit and saddle horn," Mead wrote.
Wortman, however, has said he is skeptical the bones are actually Geronimo's.
Geronimo's descendants say in their lawsuit that they want to uncover any information that people know, but have been keeping to themselves.
"To assure that all existing remains of Geronimo and funerary objects are recovered by Geronimo's linear descendants, the Order of Skull and Bones and Yale University must account for any such articles that are or have been in their possession, or on their property, and persons with knowledge must provide any facts known to them concerning the claims," the descendants' lawsuit says.
If the bones at Yale aren't those of Geronimo, Harlyn Geronimo believes they belonged to one of the Apache prisoners who died at Fort Sill. He said they should still be returned.
Harlyn Geronimo wrote to President George W. Bush in 2006, seeking his help in recovering the bones. He thought that since the president's grandfather was allegedly one of those who helped steal the bones, the president would want to help return them.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Wed Feb 18, 5:36 PM EST
Geronimo's descendants have sued Skull and Bones — the secret society at Yale University linked to presidents and other powerful figures — claiming that its members stole the remains of the legendary Apache leader decades ago and have kept them ever since.
The federal lawsuit filed in Washington on Tuesday — the 100th anniversary of Geronimo's death — also names the university and the federal government.
Geronimo's great-grandson Harlyn Geronimo said his family believes Skull and Bones members took some of the remains in 1918 from a burial plot in Fort Sill, Okla., to keep in its New Haven clubhouse, a crypt. The alleged graverobbing is a longstanding legend that gained some validity in recent years with the discovery of a letter from a club member that described the theft.
"I believe strongly from my heart that his spirit was never released," Harlyn Geronimo said.
Both Presidents Bush, Massachusetts Sen. John Kerry and many others in powerful government and industry positions are members of the society, which is not affiliated with the university.
After years of famously fighting the U.S. and Mexican armies, Geronimo and 35 warriors surrendered to Gen. Nelson A. Miles near the Arizona-New Mexico border in 1886. Geronimo was eventually sent to Fort Sill and died at the Army outpost of pneumonia in 1909.
According to lore, members of Skull and Bones — including former President George W. Bush's grandfather, Prescott Bush — dug up his grave when a group of Army volunteers from Yale were stationed at the fort during World War I, taking his skull and some of his bones.
Harlyn Geronimo, 61, wants those remains and any held by the federal government turned over to the family so they can be reburied near the Indian leader's birthplace in southern New Mexico's Gila Wilderness.
Their lawsuit also names President Barack Obama, Defense Secretary Robert Gates and Army Secretary Pete Geren as defendants.
"I want them to understand we mean business," said Harlyn Geronimo, who lives in New Mexico. "We're very serious. We're tired of waiting and we're coming after them."
Neither members of Skull and Bones, who closely guard their secrecy, nor the Russell Trust Association, the organization's business arm for tax purposes, could not be reached for comment.
Justice Department spokesman Andrew Ames said the government will "review the complaint and respond in court at the appropriate time."
Fort Sill spokeswoman Nancy Elliot declined to discuss the lawsuit, but said officials have always maintained there is no evidence supporting the descendants' claims.
Yale officials declined to comment Wednesday, saying they had not yet seen the lawsuit. Spokesman Tom Conroy noted the Skull and Bones crypt is not on Yale property.
Membership into Skull and Bones marks the elite of the elite at the Ivy League school. Only 15 Yale seniors are asked to join each year.
Members swear an oath of secrecy about the group and its strange rituals, which include devotion to the number "322" and initiation rites such as confessing sexual secrets and kissing a skull. The atmosphere makes Skull and Bones favorite fodder for conspiracy theorists.
Its most enduring story is the one concerning Geronimo's remains, and in 2005, Yale historian Marc Wortman discovered a letter written in 1918 from one Skull and Bones member to another that seemed to lend validity to the tale.
The letter, sent to F. Trubee Davison by Winter Mead, said Geronimo's skull and other remains were taken from the leader's burial site, along with several pieces of tack for a horse.
"The skull of the worthy Geronimo the Terrible, exhumed from its tomb at Fort Sill by your club and Knight Haffuer, is now safe inside the T — together with is well worn femurs, bit and saddle horn," Mead wrote.
Wortman, however, has said he is skeptical the bones are actually Geronimo's.
Geronimo's descendants say in their lawsuit that they want to uncover any information that people know, but have been keeping to themselves.
"To assure that all existing remains of Geronimo and funerary objects are recovered by Geronimo's linear descendants, the Order of Skull and Bones and Yale University must account for any such articles that are or have been in their possession, or on their property, and persons with knowledge must provide any facts known to them concerning the claims," the descendants' lawsuit says.
If the bones at Yale aren't those of Geronimo, Harlyn Geronimo believes they belonged to one of the Apache prisoners who died at Fort Sill. He said they should still be returned.
Harlyn Geronimo wrote to President George W. Bush in 2006, seeking his help in recovering the bones. He thought that since the president's grandfather was allegedly one of those who helped steal the bones, the president would want to help return them.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Monday, February 9, 2009
Symbolism of Divinity, Surrepititious Photographic Propaganda in President's Photo
In an article today out of the London Telegraph entitled "Barack Obama warns economic stimulus delay would bring 'disaster'" the above photo of the newly elected president (left) appeared saliently as a breaker between text of the article. This angle and orientation of this photo is induces Pavlovian responses in the subconscience with its unmistakable messianic motif.
Is someone out there trying to implant the view that Barack H. Obama is the next Jesus H. Christ? As a largely Christian faith based nation, the implications of the president being presented with interlaces of messianic propaganda is indeed worrisome. Perhaps this photo is just an anomaly, perhaps it is something more. We leave such judgments to the discretion of our humble readers.
http://www.telegraph.co.uk/news/worldnews/northamerica/usa/barackobama/4571678/Barack-Obama-warns-economic-stimulus-delay-would-bring-disaster.html
Financial Vampirism Continues, Wall Street Sucks Final Assets From America
Bailouts, rescue packages, troubled asset relief programs, loans, or whatever idioms the financial vultures use describe their looting of the American people's treasury, are weakening the body of America to the point of hastening collapse.
The 2008-2009 banker's plot for the liquidation and consolidation of American interests is accelerating with extreme prejudice. Under the Obama Administration with its hardened financial turncoats, two of which are former New York Federal Reserve presidents, the 2009 financial putsch is now proceeding into its final phase. The below article featured in today's edition of Forbes online explains the next installment of the financial putsch.
Business In The Beltway
Washington's Trillion-Dollar Week
Brian Wingfield, 02.08.09, 8:27 PM ET
WASHINGTON -- If all goes well for President Barack Obama, this could be one of the most expensive weeks in U.S. history.
The Senate is expected to pass an $827 billion fiscal stimulus bill, which must then be reconciled with a separate $819 billion House version. The Treasury Department will unveil a sweeping plan to use the remaining $350 billion in the government’s Troubled Asset Relief Program. Total cost: at least $1.1 trillion.
For perspective, the total cost of U.S. war funding since 2001 has been about $904 billion, according to a report by Steven Kosiak at the Center for Strategic and Budgetary Assessments. The fiscal stimulus plan Congress approved last year (remember those rebate checks?) was $168 billion. President George W. Bush’s fiscal year 2009 budget request to Congress was $3.1 trillion. The Congressional Budget Office last month predicted that the federal deficit in 2009 would reach $1.2 trillion--before the addition of a stimulus bill. The entirety of U.S. economic output is about $14.5 trillion.
The scale helps explain the bitter party-line fight over the money (so much for compromise), and why Obama, despite his convincing win at the polls in November and overwhelming approval ratings, feels he still needs to sell America on the plan. He’ll spend Monday doing just that, first in Indiana, then in Washington, where he’ll hold a nationally televised evening press conference. The Senate is expected to hold a procedural vote on its bill Monday evening, with a final vote perhaps Tuesday.
Then comes the real fight: Sorting out the details between the Senate and House bills. In order to obtain buy-in from the three Republicans needed to move the measure forward, Democrats had to concede about $110 billion in cuts, including $40 billion in aid to states for education and other services, and a $25 billion adjustment to a tax package. Among the reductions: funding for energy efficient buildings, health-care IT and health-care subsidies for the unemployed.
Convincing the majority-holding House Democrats to go for such reductions will be sticky. The two pieces of legislation are more fraternal than identical in nature. Both contain a mix of government spending and tax measures to jolt the economy back to life. But the House version contains significantly more money for higher education facilities, broadband access, energy assistance for low-income households, and other items, not to mention aid to states.
How hard will it be? Sen. Susan Collins, R-Maine, one of the Republicans who sided with Democrats after reaching a compromise on how to spend $780 billion of the money, has called the House version “bloated, expensive and ineffective.”
Also on Tuesday--not Monday, as originally announced--Treasury Secretary Timothy Geithner will unveil what the government intends to do with the remaining TARP money. Treasury has been mum about the specifics, but industry sources say to expect a multi-faceted approach that involves new capital injections into banks and a mechanism for guaranteeing asset-backed securities of all stripes, new and old, healthy and toxic, to jump-start credit markets. All assistance is expected to come with tighter strings for companies that tap the bailout fund.
There is also likely to be a component to boost the demand for housing and slow down the number of foreclosures. In a research note over the weekend, mortgage industry consultant Howard Glaser said this aspect of the plan could be announced later in the week. Among its potential elements: partial government guarantees for losses on modified loans that go into default again and the purchase of toxic mortgage assets by Fannie Mae and Freddie Mac.
What won’t the Geithner plan include? A request for more money from Congress--at least for now. Lawmakers are unhappy about the way the first $350 billion in TARP funds was put to use. They’re not likely to give the Treasury Department more, even with a new administration in the White House.
In the fall, then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke urged Congress to establish a $700 billion bailout fund for the financial system immediately in order to keep the economy from going over a cliff.
By almost all accounts, the Treasury said “trust us,” then botched it. They were slow to set up the TARP, and once Paulson received unprecedented authority from Congress to determine how the money should be spent, the administration changed course on how it would use it, abandoning a plan to buy toxic assets in favor of injecting capital into financial institutions. Nearly five months later, bank balance sheets remain stressed, lending has not dramatically increased and Geithner finds himself back at the drawing board. Meantime, thanks to a lack of oversight, Congress has little idea what financial firms did with most of the money. The legislation that set up the TARP doesn't require the government to ask most of them for that information.
It’s made the case for stimulus even tougher on Obama, who finds himself in a position similar to Bush: facing economic crisis and looking for Congress to quickly hand over hundreds of billions of dollars without lengthy debate. “Legislation of such magnitude deserves the scrutiny that it’s received over the last month, and it will receive more in the days to come,” Obama said Saturday in his weekly radio address. “But we can’t afford to make ‘perfect’ the enemy of the absolutely necessary.”
Maybe. But it all sounds pretty familiar.
The 2008-2009 banker's plot for the liquidation and consolidation of American interests is accelerating with extreme prejudice. Under the Obama Administration with its hardened financial turncoats, two of which are former New York Federal Reserve presidents, the 2009 financial putsch is now proceeding into its final phase. The below article featured in today's edition of Forbes online explains the next installment of the financial putsch.
Business In The Beltway
Washington's Trillion-Dollar Week
Brian Wingfield, 02.08.09, 8:27 PM ET
WASHINGTON -- If all goes well for President Barack Obama, this could be one of the most expensive weeks in U.S. history.
The Senate is expected to pass an $827 billion fiscal stimulus bill, which must then be reconciled with a separate $819 billion House version. The Treasury Department will unveil a sweeping plan to use the remaining $350 billion in the government’s Troubled Asset Relief Program. Total cost: at least $1.1 trillion.
For perspective, the total cost of U.S. war funding since 2001 has been about $904 billion, according to a report by Steven Kosiak at the Center for Strategic and Budgetary Assessments. The fiscal stimulus plan Congress approved last year (remember those rebate checks?) was $168 billion. President George W. Bush’s fiscal year 2009 budget request to Congress was $3.1 trillion. The Congressional Budget Office last month predicted that the federal deficit in 2009 would reach $1.2 trillion--before the addition of a stimulus bill. The entirety of U.S. economic output is about $14.5 trillion.
The scale helps explain the bitter party-line fight over the money (so much for compromise), and why Obama, despite his convincing win at the polls in November and overwhelming approval ratings, feels he still needs to sell America on the plan. He’ll spend Monday doing just that, first in Indiana, then in Washington, where he’ll hold a nationally televised evening press conference. The Senate is expected to hold a procedural vote on its bill Monday evening, with a final vote perhaps Tuesday.
Then comes the real fight: Sorting out the details between the Senate and House bills. In order to obtain buy-in from the three Republicans needed to move the measure forward, Democrats had to concede about $110 billion in cuts, including $40 billion in aid to states for education and other services, and a $25 billion adjustment to a tax package. Among the reductions: funding for energy efficient buildings, health-care IT and health-care subsidies for the unemployed.
Convincing the majority-holding House Democrats to go for such reductions will be sticky. The two pieces of legislation are more fraternal than identical in nature. Both contain a mix of government spending and tax measures to jolt the economy back to life. But the House version contains significantly more money for higher education facilities, broadband access, energy assistance for low-income households, and other items, not to mention aid to states.
How hard will it be? Sen. Susan Collins, R-Maine, one of the Republicans who sided with Democrats after reaching a compromise on how to spend $780 billion of the money, has called the House version “bloated, expensive and ineffective.”
Also on Tuesday--not Monday, as originally announced--Treasury Secretary Timothy Geithner will unveil what the government intends to do with the remaining TARP money. Treasury has been mum about the specifics, but industry sources say to expect a multi-faceted approach that involves new capital injections into banks and a mechanism for guaranteeing asset-backed securities of all stripes, new and old, healthy and toxic, to jump-start credit markets. All assistance is expected to come with tighter strings for companies that tap the bailout fund.
There is also likely to be a component to boost the demand for housing and slow down the number of foreclosures. In a research note over the weekend, mortgage industry consultant Howard Glaser said this aspect of the plan could be announced later in the week. Among its potential elements: partial government guarantees for losses on modified loans that go into default again and the purchase of toxic mortgage assets by Fannie Mae and Freddie Mac.
What won’t the Geithner plan include? A request for more money from Congress--at least for now. Lawmakers are unhappy about the way the first $350 billion in TARP funds was put to use. They’re not likely to give the Treasury Department more, even with a new administration in the White House.
In the fall, then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke urged Congress to establish a $700 billion bailout fund for the financial system immediately in order to keep the economy from going over a cliff.
By almost all accounts, the Treasury said “trust us,” then botched it. They were slow to set up the TARP, and once Paulson received unprecedented authority from Congress to determine how the money should be spent, the administration changed course on how it would use it, abandoning a plan to buy toxic assets in favor of injecting capital into financial institutions. Nearly five months later, bank balance sheets remain stressed, lending has not dramatically increased and Geithner finds himself back at the drawing board. Meantime, thanks to a lack of oversight, Congress has little idea what financial firms did with most of the money. The legislation that set up the TARP doesn't require the government to ask most of them for that information.
It’s made the case for stimulus even tougher on Obama, who finds himself in a position similar to Bush: facing economic crisis and looking for Congress to quickly hand over hundreds of billions of dollars without lengthy debate. “Legislation of such magnitude deserves the scrutiny that it’s received over the last month, and it will receive more in the days to come,” Obama said Saturday in his weekly radio address. “But we can’t afford to make ‘perfect’ the enemy of the absolutely necessary.”
Maybe. But it all sounds pretty familiar.
Tuesday, February 3, 2009
Green Brigades Set Sights on White House
Environmentalists Press Democrats With ‘Non-Negotiable Demands’
Bloomberg, February 3, 2009
By Laura Litvan and Catherine Dodge
Environmental groups are racking up a series of early wins thanks to expanded Democratic majorities in the U.S. Congress. But they aren’t satisfied, and the scope of their agenda may cause headaches for party leaders.
Environmentalists want Congress to cap greenhouse-gas emissions, a proposal meeting resistance from companies such as General Motors Corp. because of its cost. They’re pushing for laws to force public utilities to buy 15 percent of their power from renewable energy sources, an idea opposed by Southern Co. and American Electric Power Co. And they want tougher energy- efficiency standards for cars, buildings and appliances.
“They have high expectations and non-negotiable demands,” James Lucier, an energy analyst at Capital Alpha Partners LLC in Washington, said of the groups, which include the Sierra Club, Friends of the Earth and the League of Conservation Voters.
The tension will soon become apparent. More than 2,000 protesters are planning a March 2 sit-in at a coal-fired plant that produces power for the U.S. Capitol, as part of a drive to get support for climate-change legislation.
While organizations such as the Sierra Club and Friends of the Earth are leading the charge, some new, more left-leaning partners are joining the fray.
The antiwar group Code Pink is training some of its ire on House Speaker Nancy Pelosi, a California Democrat, and Senate Majority Leader Harry Reid, a Nevada Democrat.
“They keep saying, ‘We want more of a majority,’ so they’ve got a bigger majority now,” said Medea Benjamin, a co- founder of Code Pink. “We expect more concrete results.”
Passage by 2009
Reid and Pelosi say they want to move climate-change legislation through Congress this year. That goal may be more realistic now, with Barack Obama in the White House and Representative Henry Waxman heading the House Energy and Commerce Committee. Waxman, who backs stringent climate-change goals, replaced John Dingell of Michigan -- the auto industry’s closest ally in Congress -- as the panel’s chairman.
Pelosi last month praised Waxman’s plan for his committee to vote by Memorial Day, May 25.
“I share his sense of urgency,” she said in a statement.
That urgency is also felt by environmentalists. With Democrats holding 58 of 100 Senate seats and with a 77-seat advantage in the House of Representatives, they want to seize the moment. And they haven’t been placated by recent victories.
The Senate last month approved a $10 billion conservation plan setting aside more than 2 million acres of natural wilderness and protecting 1,000 miles of scenic rivers.
A portion of the spending in an $819 billion economic- stimulus measure approved by the House last week is geared toward renewable-energy projects, including $6.2 billion to weatherize low-income homes.
Obama Backs California
And Obama last week signed an executive order opening the way for California and other states to limit greenhouse-gas emissions from cars and trucks, standards opposed by GM and Ford Motor Co. as too expensive, especially given the depth of the recession.
Lobbyists at environmental groups say they can build on that momentum to get climate-change legislation through before an international summit in December in Copenhagen with hopes of reaching a global accord. Obama has pledged to cut greenhouse gases by 80 percent from 1990 levels in 2050.
“We’re very hopeful about the prospect of climate-change legislation in 2009,” said Michael Goo, legislative director for the Natural Resources Defense Council’s climate change center.
Renewable Energy
The renewable energy requirement for power-producers also remains a top agenda item for the movement. Senate Democrats dropped the requirement for utilities from a broad-based energy bill in late 2007 to help ease its passage.
Electric utilities such as Atlanta-based Southern Co. and Columbus, Ohio-based American Electric Power lobbied to get the renewable-electricity standard removed. They said the South and Midwest don’t have enough wind and other renewable energy resources to meet the standard.
Analysts say the distressed economy might make many environmental goals unattainable. Gross domestic product contracted at a 3.8 percent annual rate from October through December, the biggest drop since 1982, the government reported on Jan. 30.
Fashioning a “cap-and-trade” system to reduce carbon emissions would come with high costs to manufacturers, said Kevin Book, a senior energy analyst at Friedman, Billings, Ramsey Group Inc. in Arlington, Virginia. Such a system would place limits on polluters and require them to obtain a permit for every ton of greenhouse gas pumped into the atmosphere. Those exceeding the limits would have to buy permits from emitters that cut their output of such gases.
‘Rich Man’s Game’
“There’s a real economic challenge to the environmental movement: It’s a rich man’s game,” Book said.
Add to that divisions within the Democratic Party, and passage of legislation this year will be a challenge, said John Fortier, a congressional analyst at the American Enterprise Institute in Washington. Democrats from coal-producing or heavy industrial states are split with West Coast Democrats, who align more with stricter environmental standards, he said.
Environmental organizations also aren’t in complete agreement. Last month, the National Wildlife Federation withdrew from a coalition of groups that are fashioning ideas for cap-and-trade legislation. The federation said the ideas coming forward aren’t bold enough.
Republicans Needed
With those obstacles, Representative Chris Van Hollen, a Maryland Democrat who was a liaison between Congress and Obama’s presidential-transition team, said it’s too early to predict action this year.
“We’re going to need some Republican support,” Van Hollen said. Cap-and-trade is “an issue where you don’t only have party differences, they’re also regional.”
House Republican Conference Chairman Mike Pence of Indiana said Democrats can’t bank on Republican votes.
“The overwhelming majority of Republicans would be very dubious about any global-warming legislation, particularly during such a difficult time for working Americans,” he said.
To contact the reporters on this story: Laura Litvan in Washington at llitvan@bloomberg.net; and Catherine Dodge in Washington, at Cdodge1@bloomberg.net
Last Updated: February 3, 2009 00:01 EST
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