OPINION/COMMENTARY

Ethics Group Cites “Tangled” Relationship With Scandal-Plagued Nature Conservancy

Peter Flaherty, President of the National Legal and Policy Center (NLPC), today described an apparent conflict-of-interest involving Goldman Sachs Chairman and CEO Henry Paulson and his relationship with the Nature Conservancy. Paulson is Chairman of both Goldman Sachs and the Nature Conservancy. His wife is a former board member of the Nature Conservancy. At issue is the adoption in November 2005 by Goldman Sachs of an “Environmental Policy,” which parallels the Nature Conservancy agenda. It includes several controversial positions related to global warming, logging, and the rights of indigenous peoples in the developing world. Additionally, Goldman Sachs transferred its ownership of a gargantuan tract of 680,000 acres in Chile to a Chilean group connected to the Nature Conservancy, called the Wildlife Conservation Society (WCS). Paulson’s daughter, Merritt Paulson, is on WCS’ Board of Advisors. A Goldman executive acknowledged to the New York Times last year, “Clients don't come to us because we have an environmental policy.” NLPC has filed a shareholder proposal for consideration at the Goldman Sachs annual meeting on March 31 in New York City that asks the Board to determine whether Paulson has violated the company’s Code of Business Conduct and Ethics....

Does the Gulf of Mexico Hold as Much Oil as Saudi Arabia?

Mexico’s giant Cantarell oil field, in the Gulf of Mexico off the Yucatan, was supposedly discovered in 1976 after a fisherman named Cantarell reported an oil seep in the Campeche Bay. Last week, Mexico announced finding another giant oil field off Veracruz, the Noxal, estimated to hold more than 10 billion barrels of oil. Exploration yielded surprising results. It turned out that Mexico’s richest oil field complex was created 65 million years ago, when the huge Chicxulub meteor impacted the Earth at the end of the Mesozoic Era. Scientists now believe that the Chicxulub meteor impact was the catastrophe the killed the dinosaurs, as well as the cause for creating the Cantrell oil field. The impact crater is massive, estimated to be 100 to 150 miles (160 to 240 kilometers) wide. The seismic shock of the meteor fractured the bedrock below the Gulf and set off a series of tsunami activity that caused a huge section of land to break off and fall back into the crater under water. Proponents of the abiotic, deep-earth theory of the origin of oil point argue that the deep fracturing of the basement bedrock at Cantarell caused by the meteor’s impact was responsible for allowing oil formed in the Earth’s mantle to seep into the sedimentary rock that settled in the huge underwater crater....

The Myth of Water Privatization Failures

March 22nd is World Water Day. The dire situation that a large chunk of the world's population is in when it comes to water provision will be put on display. With good reason. More than a billion people lack access to clean and safe water, and over two billion are without adequate sanitation facilities. Twelve million people die annually of terrible water-borne diseases. The inadequate water supply helps to keep millions of people in poverty. They either have to wait in line, or carry heavy vessels of water, or they are too ill to work or study. Water distribution and sanitation have traditionally been a public responsibility. Currently, 97 percent of water distribution in developing countries is in the hands of governments. So the responsibility for above-described failures and fatalities lies with incompetent and negligent governments. And yet, in the few cases where the private sector has been given a role in water distribution, there have been large and sometimes violent outcries against privatization. Local politicians have used foreign companies in general, and international utilities in particular, as scapegoats. The debate on the role of the private sector has also been present in the West. Opponents to private sector participation claim that reforms have failed. NGOs such as the London-based World Development Movement and the American consumer advocate group Public Citizen argue that privatization has been a huge failure, that the poor have been ignored, and that most contracts have been cancelled. Some have even asserted that Western multinational water companies involved in the business have realized that there is no money to be made on poor people's need for water, and that they therefore are pulling back from developing countries. The facts and figures tell a different story. In most cases highlighted by the opponents, be it Buenos Aires, Argentina; Manila, Philippines; or El Alto, Bolivia, more people have been given access to clean and safe water following privatization. The poor have gained disproportionately in all these cases, since they are more likely than the better-off not to have been served by the operator under the public regime. And once they're hooked up to water sources, they pay dramatically cheaper prices for water than was the case when they were forced to pay for black market water. There are also cases that privatization opponents fail to mention, such as Chile, Cambodia, and Gabon, where success has been striking. Global data from the World Development Indicator database show that more people have access to an improved water source than in countries without such investment....

Capitalism for Water Day

In the time it takes you to read this paragraph at least one child will die from an easily preventable disease. Two million a year, fifty-five hundred a day, some four a minute or one every 15 seconds are killed by diarrhea, something which the availability of simple clean water will almost certainly prevent from happening. That there are one billion of our fellow humans who do not have this basic necessity of life, that there are a further billion or more without sewage or sanitation services, well, don't you think that's an indictment of the modern world? Today is World Water Day and it would seem an appropriate time to actually consider what we should do about this situation. Even if you take the line that all aid is inevitably stolen by corrupt functionaries (which does indeed often happen), think that the rise from this horrendous poverty will largely be determined by the institutions and activities within those poor countries (which I do) perhaps we could at least think through the problem and at the very least not make it worse. My former colleagues at the Globalization Institute in London have released a report on the differences between the private and public provision of water around the world. They place much of the blame for the current problems on the very fact that 95% of the world's potable water is supplied by governments rather than by (properly regulated) private sector providers. Governments are inefficient at providing services, swayed all too easily by the desires of their political supporters, prone to corruption and even worse -- in many parts of the world -- do not have the simple competence (let alone capital) to operate a fully functional system. Very well, as the report states, an obvious solution to this is that water should be provided by private sector firms, profiting from extending access, reducing wastage, increasing the purity of the water itself and generally making the world a better place....

THE WATER REVOLUTION

Ahead of the Fourth World Water Forum (March 16-22, Mexico City), the Sustainable Development Network -- a coalition of over 30 non-governmental organizations -- has released a new book, "The Water Revolution: Practical Solutions to Water Scarcity."

The authors show, with practical examples, how governments have made water artificially scarce. Where markets have been allowed -- where water is owned and traded -- access is increased, especially for the poor, whose health is consequently improved, and superior outcomes have been achieved for conservation and the environment.

The authors point to many problems plaguing countries with inadequate water supply systems, including:

* The Top-down approach to water management, such as that adopted by China, which usually exacerbates water scarcity, pollution and results in huge losses of water
* A lack of reform in many countries to the massive government subsidies given to agricultural water, which often only benefits wealthy landowners who are politically-connected, at the expense of poor taxpayers and the environment

The authors also show how a privatized water management system can provide benefits over a state run system, for instance:

* Chile's market-driven water system has achieved nearly universal access to water. Between 1970 and 1994, household access to water increased in rural areas from 27 percent to 94 percent, and from 63 percent to 99 percent in urban areas.
* Child mortality due to water-related illnesses dropped significantly after cities in Argentina privatized 30 percent of their municipal water systems in 1990.
* For more than a decade, rural areas of Gujarat, India, have collected rainwater to recharge groundwater aquifers; this creative, innovative and decentralized solution addressed water scarcity which had been induced by the government's obsession with large dams on rivers.

Source: Edited by Kendra Okonski, "The Water Revolution: Practical Solutions to Water Scarcity," Sustainable Development Network, March 13, 2006; and The 2nd United Nations World Water Development Report, "Water, a shared responsibility," United Nations, March 9, 2006.

For text:http://sdnetwork.net/page.php?instructions=page&page_id=560&nav_id=131

For UN report:http://www.unesco.org/water/wwap/


PLF Goes to Supreme Court to Fight a Federal Power Grab

Mark the day: February 21, 2006. On that Tuesday morning at the United States Supreme Court, newly confirmed Justice Samuel Alito will join his colleagues to hear his first oral argument as a member of the court. It’s also a big day for Pacific Legal Foundation, its supporters, and all proponents of limited government and constitutional rights. The lawsuit that leads off the February 21, Supreme Court docket—billed as one of the most important property rights cases to get to the high court in years—is the PLF case of Rapanos v. United States. Will PLF’s client, Michigan resident John Rapanos, finally receive the fairness and justice that have been denied him over the past two decades, when the federal government has gone to extraordinary lengths to bully him in order to halt development of his property? The answer could help determine the balance between federal and local authority on a broad range of subjects through the coming years. At issue in particular is whether Washington’s power over private property—and property owners—will be held in check by traditional constitutional norms, or whether federal regulators will be allowed to push aside state and local officials and assume the role of a national zoning board....

MONTANA OIL AND GAS OPERATOR APPEALS RULING

A small, family-owned, Billings, Montana, oil and gas company today joined with the federal government in appealing an adverse ruling by a Montana federal district court. Macum Energy, which owns oil and gas leases issued by the Bureau of Land Management (BLM) and a gas pipeline authorized by the BLM, argues that, contrary to assertions by a Montana environmental group, the BLM complied with federal environmental laws and the leases issued to Macum and the authorization granted for its pipeline are legal and may not be set aside. The appeal to the U.S. Court of Appeals for the Ninth Circuit follows a January 2006, ruling by the court in favor of the Montana Wilderness Association. “We join with the U.S. Department of Justice in appealing to protect the interest of our client and its ability to continue to transport gas to Montana consumers,” said William Perry Pendley of Mountain States Legal Foundation, which represents Macum. "Today may be the first day of spring but winter storms are sweeping across the Mountain West and this is hardly the time to place the delivery of any natural gas supplies at risk. We believe that the BLM complied with federal law prior to first issuing our client’s leases and authorizing its pipeline. If it did not then, it has done so by now.” In September 1999, the BLM made available more than 180 parcels of federal land in a competitive oil and gas lease sale; Macum purchased the three leases at issue in the lawsuit. In November 1999, Macum sought and received permission for a pipeline to deliver natural gas from its previously existing wells to market. In December 1999, Macum installed the pipeline along an existing road. Later, Macum applied for permits to drill (APDs) gas wells on its new leases. In March 2000, BLM's approval process for those APDs was halted when the Montana Wilderness Association sued after it learned President Clinton would create a national monument in the area....

Farm Subsidies: Devastating the World's Poor and the Environment

Subsidized agriculture in the developed world is one of the greatest obstacles to economic growth in the developing world. In 2002, industrialized countries in the Organization for Economic Cooperation and Development (OECD) spent a total of $300 billion on crop price supports, production payments and other farm programs. These subsidies encourage overproduction. Markets are flooded with surplus crops that are sold below the cost of production, depressing world prices. Countries with unsubsidized goods are essentially shut out of world markets, devastating their local economies. Moreover, farm subsidies lead to environmental harm in rich and poor nations alike. Prosperous countries give about $50 billion to $55 billion annually in foreign aid to underdeveloped nations. If developed nations reduced their subsidies and eliminated trade barriers — such as import tariffs protecting domestic producers from international competition — this aid would arguably be unnecessary and rural poverty might be significantly reduced. Historically, agriculture has been a major pillar — if not the foundation — of developing economies because it provides food security, creates employment and generates local capital. For example, in 1790, nearly 90 percent of the U.S. workforce was employed in agriculture. By 1900, farmers dropped to 38 percent of the labor force, and today they account for less than 1 percent. Agriculture accounts for less than 1 percent of U.S. gross domestic product (GDP). Similar trends in other OECD countries indicate that the path to development begins with agriculture....

My Cat Made Me a Criminal

Not yet at least, but I don't live in Colorado. However, if your cat eats a Preble mouse in Colorado, you can be fined for it by the Feds. Only the government could find a way to fine you for something mother nature did, like this instinct making a cat enjoy the taste of mice. This is just another example of the perverse realities currently allowed under our 1973 Endangered Species Act to save a mouse thats not going extinct....