Morning News - Trade and Climate Change Edition
It’s primary day in Pennsylvania. The Drudge Report claimed yesterday that there was jubilation in the Clinton camp after their internal polling showed their candidate with an 11-point lead. The Clinton campaign denied that report and said it is expecting a close race. A poll of polls shows Clinton with a 5-6 point lead. A win by any margin will be enough to send Hillary on to Indiana and North Carolina, which hold their primaries May 6. However, she’s experiencing serious cash problems and her ability to effectively compete in those states is being questioned.
With oil at $117 a barrel and climbing – and U.S. gasoline prices at an historic high of $3.50 a gallon – you’d think demand would start a fall. Well, it is in the United States, but not elsewhere. For the first time, China, India, Russia, and the Middle East will consume more crude oil than America, burning 21 million barrels a day this year, an increase of 4.4%. U.S. demand will contract 2% to 20 million barrels daily.
The consumption of all that oil has driven fears about climate change and what to do about it. Jeff Immelt, chairman and CEO of General Electric, said yesterday much of the technology to make energy generation cleaner and more efficient is available now. The challenge, however, is deploying it and making it cheaper. Immelt urged utility executives to keep all technologies on the table - from solar and wind to nuclear and cleaner coal - and to not let new technologies languish at the expense of maintaining the status-quo. He said low oil and gas prices historically led to massive underinvestment in the sector, but with high energy prices now soaring, Immelt believes investments in energy will follow suit.
Fortune magazine has listed its top 1,000 companies for 2008. Three energy companies made the top ten – Exxon Mobil, Chevron, and ConocoPhillips. Wal-Mart topped the list. Rounding out the top ten were GM, GE, Ford, Citigroup, Bank of America, and AT&T. AIG was 13th, UPS was 46th, Caterpillar was 50th, and 3M was 100th.
The Wall Street Journal reports that North American leaders are using their summit in New Orleans to promote the benefits of NAFTA amid warnings from business leaders that public perceptions and isolationist rhetoric threaten the future of free trade. Tom Donohue is quoted in the article saying he doesn’t believe NAFTA will be reopened and defended it as fundamentally fair, saying U.S. exports and imports under NAFTA -- excluding energy -- have increased at comparable levels. Donohue was also quoted in a similar article in The Washington Post, saying, "I don't think we are going to screw up the NAFTA deal."
The New York Times has an article on NAFTA today, saying far more jobs have been lost to Asia than Mexico since the agreement and wondering what the United States might have to give up in exchange for stronger labor and environmental provisions if the treaty is reopened. It also notes Mexico has actually lost manufacturing jobs since implementation of the treaty, mostly to China, where wages are even lower.
One of The Washington Post’s editorial writers had a solo piece yesterday called "Arizona’s Immigration Two-Step." It started like this:
Traumatized by a tidal wave of illegal immigrants, Arizona last year enacted the nation's most pitiless law to punish employers who hire undocumented workers. Now state lawmakers, having proved that they mean business -- even if it means killing off businesses -- are reconnecting with reality: They want to import Mexican workers.
After the roosters have come home to roost -- immigrant neighborhoods in Phoenix started emptying out; some employers called in suspect workers and fired many; and key industries are facing worker shortages -- the legislature, with far less fanfare, is pushing through a measure calling for an Arizona-specific temporary guest-worker pilot program. The author says that would need congressional or federal approval, which, given recent history, may be problematic, to say the least. Until Congress resolves the debate over immigration, we’re likely to experience a lot more situations just like this across the country.