TransCanada, the Canadian company that sought permission to build the controversial Keystone XL pipeline to transport tar sands oil from Alberta through the Midwestern United States to Texas, where it could be refined and exported, announced that it was filing a claim against the US for $15 bln, under provisions in the North American Free Trade Agreement (NAFTA).

The lawsuit will be heard by an international tribunal which cannot overturn the permit denial, but it can order payment of damages. The decision cannot be appealed to US courts.

A similar tribunal last year, acting on a complaint from Mexico and Canada, imposed $1 bln in retaliatory tariffs against the US for requiring beef and pork to have country of origin labeling (COOL). Congress repealed COOL as part of the omnibus spending bill signed by President Obama in December.

Samantha Page of ThinkProgress wrote (1/8) that TransCanada’s use of the Clinton-era trade agreement might be the rallying point activists need to stop another, perhaps even more far-reaching, federal action: the pending Trans-Pacific Partnership. The TPP is a massive, Pacific Rim trade agreement that would apply NAFTA-like provisions — including prohibitions on interfering with private investment — to the relationships between the United States and 11 other countries, including Japan, Malaysia, and Vietnam.

Environmentalists have long warned that the TPP, which was finalized last fall and is awaiting Congressional ratification, would jeopardize countries’ abilities to implement climate and environmental policies.

Those warnings now come with a high-profile example.

“TransCanada has just done the best possible job of making clear why TPP is such a terrible idea,” Bill McKibben, founder of 350.org and a leader of the environmental movement, told ThinkProgress via email. “Their position seems to be that NAFTA is a planetary suicide pact that forces us to pour carbon into the atmosphere. Americans rallied in unprecedented numbers to beat Keystone, and now TransCanada wants to overturn all that energy behind closed doors?”

The culprit in both NAFTA and the TPP is the so-called Investor State Dispute Settlement (ISDS) clause, which allows companies to file claims for damages if government regulations interfere with their business. The intention of the clause is to prevent countries from preferential permitting, such that a Canadian business has the same right to US development as a US company. But the process can be used to elevate corporate profits over self-determination and has been broadly criticized by not just environmentalists, but also health care officials, food safety groups, and human rights organizations.

“TransCanada’s alarming case I think presents the TPP as a clear next target for the environmental movement that helped to defeat keystone XL,” Ben Beachy, a senior policy advisor with the Sierra Club’s Responsible Trade Program, told ThinkProgress. He said his group would certainly use the example of the TransCanada case to demonstrate why the TPP is a bad idea.

“Why dwell on hypotheticals when the threat has been made manifest?” Beachy asked. “We can point to the very clear, high profile one that is TransCanada.”

And for those who say the TPP is a better-crafted deal that its North American predecessor, analysts point to the striking similarities between the TPP and NAFTA. According to analysis from Public Citizen, a group that lobbies on behalf of the American public, the TPP is no better than NAFTA at preventing the kind of abuse the TransCanada claim represents.

While the TPP negotiations are done — President Obama is reportedly keen on getting it passed during his final year in office — ratification is by no means guaranteed. In addition to dealing with an intractable Congress, whose Republican leadership says it won’t move on the agreement until after November, this new development is likely to earn the TPP a second look.

The TPP already has proved divisive.

Last year, environmental groups turned on longtime ally Rep. Ed Blumenauer (D-OR) over his support for fast-tracking the TPP text. Greenpeace, Friends of the Earth, and Food & Water Watch took out television ads in Blumenauer’s district, calling for his opposition to the agreement. Blumenauer, who vociferously opposed Keystone XL, might rethink his position if the weight of the anti-Keystone movement begins to push the issue.

Rep. Gerry Connolly (D-Va.) is another example. He came out strongly against Keystone XL, but recently told The Hill that he expects the 20 Democrats who voted for fast-track authorization on the TPP to stay behind it.

NEW LOUISIANA GOV. EXPANDS MEDICAID ON FIRST DAY. Louisiana became the 31st state to join Obamacare’s Medicaid expansion, when new Gov. John Bel Edwards (D) signed an executive order implementing the expansion (1/12). The state is aiming for the program to be in effect by 7/1, according to The Hill.

Edwards was sworn into office Monday (1/11), and Tuesday was his first full day in office.

Edwards defeated US Sen. David Vitter (R) in November to succeed Republican Bobby Jindal — an ardent Obamacare opponent — in the governor’s mansion. Edwards made expanding Medicaid a focal point of his campaign.

The move allows an estimated 193,000 uninsured people with incomes up to 138% of the poverty level, or about $33,000 for a family of four, to get health care through Medicare, with the federal government picking up the tab.

“We want to bring our federal tax dollars back home to help us ensure healthier outcomes for our people,” Edwards said (1/12).

Obamacare supporters are hoping that more states in the south will come around to Medicaid expansion. Alabama’s Republican governor, Robert Bentley, for example, has said he is “looking” at the possibility.

Opponents often cite cost, noting that states eventually will have to pick up 10% of expenses, as well as ideological objections to expanding government-run healthcare.

New Kentucky Gov. Matt Bevin (R) recently backed down from his campaign promise to withdraw from the Medicaid expansion there, which covers about 425,000 Kentuckians, but he plans to dismantle the state’s popular Kynect health exchange. Bevin said he plans to transition Kentuckians to the federal site, healthcare.gov, to shop for insurance under Obamacare.

Bevin said people covered by Medicaid should expect no major changes this year while he seeks permission from federal officials to restructure the program for 2017 to include more cost-sharing by consumers, such as co-pays or premiums, the Louisville Courier-Journal reported (1/11).

US SOLAR INDUSTRY CREATES MORE JOBS THAN OIL & GAS EXTRACTION. Over the last year, the solar industry added jobs twelve times faster than the rest of the economy, even more than the jobs created by the oil and gas extraction and pipeline sectors combined.

The Solar Foundation released its annual Solar Jobs Census Tuesday, and found that for the third straight year, the solar workforce grew 20% in the US. According to the census, the industry added 35,052 jobs, elevating its grand total to 208,859. That builds on the 31,000 jobs added the year before, and 23,600 added the year before that.

“It’s incredible,” SolarCity CEO and co-founder Lyndon Rive told ThinkProgress. “The industry employs over 200 thousand people — more than the coal industry.”

The census found that even just the US solar installation sector employed 77% more people than the coal mining industry. Installers have reported the most job growth by far, with project development, sales, and distribution also rising. (Ryan Koronowski, ThinkProgress.org, 1/12)

OKLAHOMA RESIDENTS SUE FRACKERS OVER EARTHQUAKE DAMAGE. Fourteen homeowners in Edmond, Okla.. filed a lawsuit against 12 energy companies (1/11/16), claiming that the companies’ fracking operations are responsible for an uptick in earthquakes. The lawsuit claims that the injection of fracking wastewater into disposal wells “caused or contributed” to earthquakes and constituted an “ultrahazardous activity.”

In the lawsuit, filed in state district court in Oklahoma County, the residents focus on two earthquakes — of 4.3 and 4.2 magnitude — that struck Edmond on 12/29 and 1/1. The plaintiffs say they suffered damage from the earthquakes, and that the energy companies were “negligent, careless, and reckless” in their treatment of the earthquake risks surrounding wastewater injection.

Wastewater injection has been tied to increased earthquake risk. The US Geological Survey reported last year that many of the earthquakes that have peppered the Midwest since 2009 could be linked to oil and gas companies’ practice of injecting their wastewater deep underground. If wastewater is pumped into a fault, scientists think, it could cause the fault to slip, causing an earthquake. Researchers have linked wastewater injection to earthquakes in Texas and Ohio.

Oklahoma has seen a major uptick in earthquakes in recent years. From 1991 to 2008, Oklahoma experienced no more than three 3.0 magnitude or higher earthquakes every year. In 2009, the state started to see an increase in earthquake activity. In 2014, Oklahoma was the most seismically active state in the lower 48 US states, with 585 quakes. 2015 was even higher, with 857 quakes — more than all the lower 48 states combined.

These earthquakes have spurred other lawsuits in the state. The Oklahoma Supreme Court ruled last year that people could sue oil companies for damages claimed to be caused by earthquakes. That was good news for Sandra Ladra, who sued Tulsa-based oil and gas company New Dominion LLC for damages related to a November 2011 earthquake. The Oklahoma Supreme Court ruling means that her case can proceed. And another lawsuit seeks class-action status for residents affected by earthquakes in multiple Oklahoma counties. (Katie Valentine, ThinkProgress.org, 1/12)

GOOD JOBS REPORT FOR DECEMBER. The US gained 292,000 jobs in December, and the unemployment rate remained 5%, the Bureau of Labor Statistics reported (1/8). (That’s down from a 9.6% average unemployment rate in 2010, when the Bush recession bottomed out.) Employment gains were led by professional and business services, construction, health care, and food services and drinking places, BLS reported. Mining employment continued to decline.

The underemployment rate, which includes not only the unemployed, but also discouraged workers, part-time workers who are looking for a full-time job and other marginaly attached workers, dropped from an average of 16.7% in 2010 to 9.9% in December.

Economist Dean Baker noted that the unemployment rate has fallen much more rapidly than most economists expected, “and at 5% is relatively low by historical standards. If we go back to the 2012 election, this is a much better economic performance than even President Obama’s backers would have predicted.

“While the labor market is clearly improving, most people still don’t have much reason to be happy. Real wages for most workers are only slightly above their pre-recession level, and have risen by just over 7% since the turn of the century. Even the small gains in real wages that workers have seen in the last couple of years have been largely the result of the collapse in world oil prices. If prices go back up, this windfall will quickly be reversed.”

He also noted that the employment to population ratio, which had been remarkably stable over the last few years, has risen by 0.2 percentage points in the last couple of months. “It appears that people are finally returning to the labor market as job prospects improve. If this pattern continues, we may be getting to a labor market that is tight enough for workers to get their share of productivity growth and perhaps even make up the ground lost in the downturn. However we still have a long way to go to get to where the labor market should be.”

Paul Krugman noted in the New York Times (1/11) that the US has gained 14 mln jobs since private-sector employment hit its low point in February 2010. That’s roughly double the number of jobs added during the supposed Bush boom before it turned into the Great Recession, Krugman noted.

And the Obama boom happened despite Republican predictions that nearly every one of Obama’s initiatives would kill jobs. Former House Speaker John Boehner once used the phrase “job-killing” seven times in less than 14 minutes. Critics claimed the 2010 Dodd-Frank financial reform would crush employment by starving businesses of capital. When Obama raised taxes on high incomes, especially at the very top, where average tax rates rose by about 6.5 percentage points after 2012, critics claimed it would destroy incentives. And Republicans predicted the Affordable Care Act would have catastrophic effects on employment.

None of those dire predicted consequences of Obama’s policies have materialized, Krugman noted. “So what do we learn from this impressive failure to fail? That the conservative economic orthodoxy dominating the Republican Party is very, very wrong,” Krugman wrote.

“America achieved rapid, indeed unprecedented, income growth in the 1950s and 1960s, despite top tax rates beyond the wildest dreams of modern progressives,” he wrote. “For that matter, there are countries like Denmark that combine high taxes and generous social programs with very good employment performance.

“But for those who don’t know much about either history or the world outside America, the Obama economy offers a powerful lesson in the here and now. From a conservative point of view, Mr. Obama did everything wrong, afflicting the comfortable (slightly) and comforting the afflicted (a lot), and nothing bad happened. We can, it turns out, make our society better after all.”

BERNIE SANDERS GETS MOVEON ENDORSEMENT. Bernie Sanders won the presidential endorsement of progressive advocacy group MoveOn.org with a record-setting 79% of 340,665 votes cast by the group’s members, the organization announced (1/12).

The top reasons Sanders won MoveOn’s endorsement included:

• His “lifelong commitment to standing up to corporate and 1% interests to fight for an economy where everyone has a fair shot.”

• His support for initiatives such as police demilitarization and an end to failed policies like mass incarceration and the so-called War on Drugs.

• His opposition to the Iraq war and other US military intervention overseas

• His “electability” against potential GOP nominees over Democratic rivals Hillary Clinton and Martin O’Malley.

Sanders’ vote total and percentage are the best any presidential candidate has performed in our 17-year history, MoveOn said in a press release.

Clinton received 14% of the vote, and O’Malley garnered 0.9.

MoveOn added, “regardless of who wins the nomination, MoveOn will support the eventual Democratic nominee in the general election to keep a Republican out of the White House, because the vast majority of members have made clear that it’s what they want MoveOn to do.” (Ilya Sheyman, CommonDreams.org (1/12).

AMERICANS ARE HAPPIER AND ANGRIER THAN EVER. Americans are nearly as happy as they’ve ever been with things in their personal life, but they’re upset with how things are going in the US.

A Gallup poll conducted Jan. 5-8 showed 85% of Americans satisfied with the way things are going in their personal lfe, with 14% dissatisfied. That’s up 6 points in the past year and close to an all-time high.

At the same time, Kevin Drum noted at MotherJones.com (1/12), only 20% are satisfied with how things are going in the US. That’s up from 7% in 2009 but down from 70% in 2002.

The 6-point increase in personal satisfaction over the past year is “pretty huge,” Drum noted. “But that hasn’t translated into any change in satisfaction with how things are going for the country. A corresponding increase would be something like 40 percentage points. In reality, satisfaction [with things in the US] went down in 2015 by about 10 points.”

He noted, “Normally, satisfaction with the country goes up as we recover from recessions. And we have recovered. Employment is up. Inflation is low. Gas prices have dropped. Taxes haven’t changed for anyone even close to middle class. Broadly speaking, things are going pretty well.

“The usual response at this point is to say that despite all this, wages are stagnant. And that’s true. But wages have been pretty stagnant for a long time. What’s more, over the past year we’ve actually started to see them rise a bit. Not a lot, but some.”

Drum added, “We don’t live in nirvana. We never have. But by most standards, things are going pretty well. For liberals, we have gay marriage, Obamacare, and better Wall Street regulation. For conservatives, we have *Citizens United*, continued low taxes, and total control of Congress. For everyone, crime is down, school test scores are up, and terrorists continue to kill virtually no one here in America.

“I honestly don’t get it. America isn’t a utopia, and America isn’t a dystopia. It’s recovering pretty decently from a huge recession and personal satisfaction with life is high. On other fronts, lots of things are going well and a few aren’t. Same as always.

“So why all the anger? Can it really be laid at the feet of the media?”

MAJOR COAL COMPANY FILES BANKRUPTCY. Arch Coal, one of the United States’ largest coal companies, filed for bankruptcy (1/11) in the hopes of eliminating more than $4.5 bln in long-term debt, according to a press release issued by the company.

The news comes as several of Arch’s competitors — Patriot Coal, Walter Energy, and Alpha Natural Resources — have also filed for bankruptcy. Arch Coal is the second largest supplier of coal in the US behind Peabody Energy, and its mines represent 13% of America’s coal supply.

Low natural gas prices and environmental regulations made 2015 a tough year for the US coal industry, with domestic production levels slumping to a 30-year low. Coal production has been on the decline for years, since peaking in 2008, and 2015’s production numbers represent a 10% decline from 2014. Recent climate policies have also hampered coal use, which is more expensive and polluting for utilities than natural gas. In April, natural gas surpassed coal, for the first time ever, as the primary source of electricity generation in the country (though it remained in the top spot for only a month before being overtaken by coal).

“US coal consumption is declining dramatically as coal-fired power plants are shutting down. Coal is being displaced by renewables and natural gas, and the Asian markets that all coal companies were looking to as their saviors are moving in the opposite direction,” Ross Macfarlane, senior advisor with Climate Solutions, told ThinkProgress (1/11). “[Arch’s bankruptcy filing] wasn’t unexpected, but it’s still very significant in that it shows that the second-largest coal company in the United States is unable to pay its debts and provide any return at all to its shareholders.”

PUBLIC SECTOR UNIONS BRUTALIZED AT SUPREME COURT. Public sector unions had a simply terrible day (1/11) when the Supreme Court heard oral arguments in the case of Friedrichs v. California Teachers Association, which challenges “agency fees” or “fair share fees,” which unions charge non-members to recoup the cost of services performed for those non-members.

Justice Antonin Scalia, the conservative who seemed most inclined to agree with unions prior to oral argument, took a hard turn against them within just a few minutes of argument, Ian Millhiser noted at ThinkProgress.org. Justice Anthony Kennedy, who normally is the closest thing the Court has to a swing voter, appeared to grow increasingly angry with the unions as the argument proceeded. Plus the Supreme Court has already dropped two big hints that it’s ready to cut of a major source of funding for public sector unions.

Oral arguments cannot always predict the outcome of the case — just ask the millions of Americans who are now insured because of Obamacare — but if they offer any predictive value, a lot of unions are very frightened right now.

Unions are required by law to bargain on behalf of every worker in a unionized shop, even if those workers opt not to join the union. As such, non-members receive the same higher wages (one study found that workers in unionized shops enjoy a wage premium of nearly 12%) and benefits enjoyed by their coworkers who belong to the union.

Absent something else, this arrangement would create a free-rider problem, because individual workers have little incentive to join the union if they know they will get all the benefits of unionizing regardless of whether they reimburse the union for its costs. Eventually, unions risk becoming starved for funds and collapsing, causing the workers once represented by a union to lose the benefits of collective bargaining.

To prevent this free-rider problem, union contracts often include a provision requiring non-members to pay agency fees.

In essence, these fees exist to ensure that non-members do not get something for nothing. Instead, they require the non-members to pay their share of the costs of obtaining the benefits of unionization.

The plaintiffs in Friedrichs argue that such fees violate the First Amendment, at least with respect to public sector unions. As a general rule, the First Amendment does not permit the government to compel someone to say something they disagree with, and the plaintiffs claim that requiring non-union members to subsidize collective bargaining by a union that they may not agree with essentially rises to the level of compelled speech.

Were this a case where the government actually required private citizens to subsidize the union’s bargaining, the plaintiffs may have a point. The First Amendment is strongest when government uses its power as “sovereign” to compel individual action. It is much weaker, however, when the government only seeks to manage its own employees. As Justice Kennedy explained in his opinion for the Court in *Garcetti v. Ceballos*, “government employers, like private employers, need a significant degree of control over their employees’ words and actions; without it, there would be little chance for the efficient provision of public services.”

Yet, whatever force Kennedy’s words may have in the abstract, it quickly becomes clear during oral arguments in Friedrich that they have not convinced Justice Kennedy. Shortly after Edward DuMont, the Solicitor General of California who is one of three attorneys arguing in favor of agency fees, takes the podium, Kennedy launched into a monologue about how many teachers disagree with the position taken by their union. When David Frederick, another lawyer defending the fees, pointed to Kennedy’s opinion in Garcetti, Kennedy appeared to grow angry at the suggestion that his prior opinion controls this case. In perhaps the most ominous sign for unions, Kennedy also dropped the words “compelling interest” in a brief quip about what the state must demonstrate in order to justify entering into an agreement that provides for agency fees.

Those two words are one prong of a test known as “strict scrutiny,” the most skeptical test the Supreme Court applies under the Constitution. When a justice tells you that you have a burden to demonstrate a compelling interest, they are typically telling you that you should lose your case.

Before the 1/11 argument, unions had some hope that conservative Justice Scalia might cross over and give them the fifth vote they need to preserve agency fee agreements (all four of the Court’s more liberal members appeared all but certain to vote to uphold such agreements). During oral arguments on the Court’s 2014 decision in *Harris v. Quinn*, a closely related case that expressed deep skepticism of agency fees, Scalia asked some questions which suggested that he was concerned that the legal argument against agency fees goes too far. That Justice Scalia, however, did not show up in Court on 1/11. The one that did show up compared agency fee agreements to a law compelling people to subsidize the Republican Party.

Lest there be any doubt, Chief Justice John Roberts and Justice Samuel Alito also appeared firmly against agency fees. At one point, Roberts suggested that any bargaining position taken by a union that would cost the state any money at all is a matter of public concern subject to rigid First Amendment review. Justice Clarence Thomas was, as usual, silent. Although it is very unlikely that the Court’s most conservative member will side with the unions.

That leaves the plaintiffs with what appear to be five clear votes giving them the right to get something for nothing.

From The Progressive Populist, February 1, 2016


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