May 08

Today’s News 8th May 2023

  • Biden Admin Backs Down In Standoff With Catholic Hospital Over Chapel Candle
    Biden Admin Backs Down In Standoff With Catholic Hospital Over Chapel Candle

    Authored by Ross Muscato via The Epoch Times (emphasis ours),

    The Biden administration announced on May 5 that it is stepping back from a previous decision demanding that a Catholic hospital in Oklahoma remove a lit candle from its chapel—a practice and observance sacred to Catholics—or lose its ability to accept Medicare, Medicaid, or Children’s Health (CHIP) patients.

    A lit candle in the chapel of Saint Francis Hospital South is at the center of a matter of religious liberty. (Saint Francis Health System.)

    Centers for Medicare & Medicaid Services (CMS), a division of the Department of Health and Human Services (HHS), had ruled in April that the candle, which has burned continuously for 15 years at Saint Francis Hospital South in Tulsa, was a safety hazard—even though a local fire marshal cleared the candle and CMS permitted other flames, including pilot lights, in the hospital.

    CMS said its decision was based on the findings of an independent group, The Joint Commission, which reviews hospitals to determine if they meet the standards necessary to be accredited to receive Medicare, Medicaid, and CHIP patients.

    The 12th largest U.S. health care network, Saint Francis Health System is the Catholic owner and operator of Saint Francis Hospital South, eight other hospitals, and 110 clinics in Oklahoma. Saint Francis appealed the CMS decree and sought a reasonable accommodation.

    CMS denied Saint Francis’ request in a letter dated April 20.

    Yet, following widespread protest, media attention, and a pre-litigation letter a leading religious liberty legal group, Becket Law, along with Yetter Coleman LLP, sent to CMS on behalf of Saint Francis, alleging that prohibiting the candle was a violation of the First Amendment free exercise of religion clause, the agency said it is now open to working with Saint Francis to find an arrangement that permits the burning candle to stay.

    Lori Windham, vice president and senior counsel for Becket Law, said that CMS’ adjusting its position is a win for religious freedom.

    “The decision of CMS shows that religious liberty protections extend to practicing your faith, and that includes providing health care and worship in a chapel,” Windham told The Epoch Times. “These protections apply to everyone. Today it’s a candle. Tomorrow it could be something else.

    “And so, a good decision today for Saint Francis is a good decision for religious believers across the country.”

    In a statement that CMS shared with The Epoch Times, the agency said: “CMS is aware of a safety finding involving a fire risk, made by an independent accrediting organization, issued to a hospital in Oklahoma. CMS met with the hospital and accreditation organization, and issued a waiver to allow the hospital to mitigate the potential fire risk and correct the safety finding. The hospital will work with the accrediting organization on next steps.”

    Windham said Saint Francis has put up a sign to let people know there is a flame in the chapel and plans to put a rail or other barrier in place to prevent people from getting too close.

    Saint Francis Health System, with its stated mission to “extend the presence and healing ministry of Christ to all who seek its services,” treats approximately 400,000 people annually and has delivered more than $650 million in free care to people in need over the past five years.

    The organization employs more than 10,000 and has a volunteer force of 700.

    Infringing on Religious Freedom

    A lit candle in a chapel is a fundamental component of the Catholic canon law, of the rules and ways the church governs itself.

    As was the case before the CMS judgment, the candle is set within two layers of glass, on a metal base with a metal top, and affixed to the wall.

    When CMS said the candle had to go, it struck at the spiritual and cultural heart and foundation of the purpose of the Saint Francis Health System.

    “We’re being asked to choose between serving those in need and worshiping God in the chapel, but they go hand in hand,” said Barry Steichen, executive vice president and chief operating officer of Saint Francis Health System, in a May 3 statement.

    “Our work depends upon our faith in the living God, and the sanctuary candle represents this to us.”

    The 13-page pre-litigation letter sent to CMS asserted that prohibiting the candle was an example of consistently applying rules and regulations and violating religious freedom.

    “You have threatened to deny accreditation because Saint Francis keeps a candle—an eternal flame—in its hospital sanctuary,” wrote Windham. “For 15 years, that flame has burned without problem or concern in Saint Francis Hospital South in Tulsa; and for 63 years, the eternal flame has burned at Saint Francis Hospital Yale Campus, the largest hospital in the state of Oklahoma, without problem or concern.”

    “From the moment Saint Francis opened its doors in 1960, this flame has been maintained without interruption. In requiring Saint Francis to extinguish its flame, you are trying to extinguish not just a candle, but the First Amendment rights of Saint Francis Health System, as well as vital healthcare for the elderly, poor, and disabled in Oklahoma.”

    Tyler Durden
    Sun, 05/07/2023 – 23:30

  • Liberal Utopia: Two-Mile-Long Vehicle Encampment Spotted In California
    Liberal Utopia: Two-Mile-Long Vehicle Encampment Spotted In California

    The growing number of homeless encampments has spread like wildfire throughout the San Francisco Bay Area. For years, lawmakers in the state have implemented progressive policies that have backfired, sparking a multitude of crises, including soaring crime, rising homelessness, out-of-control drug overdoses, and population and business exodus.

    One of the latest examples of implementing failed progressive policies is the inability to effectively address the homelessness and drug crisis on a two-mile stretch of road in Marin County, California, overrun by cars, tents, RVs, and trailers parked on the side of the road. 

    Just north of San Francisco along Binford Road, the Daily Mail counted at least 135 vehicles. This is one of the largest encampment sites in the state. 

    Police in Marin County have found some individuals dealing fentanyl and other drugs from their vehicles or tents. In one bust, agents seized a ‘ghost gun’ and large amounts of fentanyl, methamphetamine, and marijuana. 

    Photos taken by Daily Mail show a large number of vehicles. 

    Many of the residents living in their vehicles are said to be from the surrounding area — many of which were kicked out of their homes because the coast of shelter and food spiked in recent years. 

    So why do California leaders deliberately choose to leave the homeless unsheltered and allow open-air drug markets that have transformed some parts of the state, such as the 2-mile strip on Binford Road, into what appears to be a ‘third world’-like country? 

    Is it the mess they created is too large to solve? 

    Tyler Durden
    Sun, 05/07/2023 – 23:00

  • Parody Becomes Reality: Babylon Bee Predicts Gender Bender Friendly Military Recruitment
    Parody Becomes Reality: Babylon Bee Predicts Gender Bender Friendly Military Recruitment

    A year ago, The Babylon Bee wanted to help the US military promote its new recruitment efforts with a stunning and brave commercial advocating for more diversity and inclusion in combat. 

    Now, it appears that the US Navy among other branches is taking parody and turning it into reality. 

    Surely the Navy’s latest drag queen digital representatives will be enough to secure the number of volunteers needed to shore up the military’s waning numbers. 

    They just needed the Bee to show them how it’s done…

     

     

    Tyler Durden
    Sun, 05/07/2023 – 22:00

  • Binance Closes Withdrawals Amid Congestion On Bitcoin Network
    Binance Closes Withdrawals Amid Congestion On Bitcoin Network

    Authored by Ana Paula Pereira via CoinTelegraph,

    Crypto exchange Binance closed Bitcoin withdrawals on May 7 due to an alleged overflow of transactions on the Bitcoin network. 

    Bitcoin mempool was clogged with over 400,000 transactions waiting to be processed at the time of writing. The mempool is known as the “waiting area” for incoming transactions before they are verified independently by each node on the network.

    Bitcoin mempool at 16:42 UTC on May 7. Source: mempool.space

    Binance tweeted that BTC withdrawals had resumed after nearly an hour of halting. Outflows on the crypto exchange peaked on Sunday, rising to $187 million, according to data from CryptoQuant.

    Behind the congestion is believed to be a surge in BRC-20 transactions in the last few days due to memecoins like Pepe (PEPE). The memecoin trading hype drove Bitcoin transaction fees to their highest point in two years. On May 3, the total amount of fees paid on the Bitcoin blockchain reached $3.5 million, jumping nearly 400% from late April, Cointelegraph reported.

    Bitcoin outflow on Binance over the past seven days. Source: CryptoQuant. 

    Developed after Ethereum’s ERC-20 token standard, BRC-20 is an experimental token standard recently introduced that allows users to create and transfer fungible tokens on the Bitcoin blockchain. It is currently becoming a hot spot for meme tokens. 

    CoinMarketCap’s data shows that PEPE’s price has climbed over 263% in the last week. As of writing, however, the memecoin is down over 7% following a 30% drop on May 6 as whales profited from Binance’s recent listing. Crypto exchanges MEXC Global, Bitget, Gate.io, and Huobi listed PEPE trading pairs two weeks ago, kicking off the token hype.

    Since the introduction of Dogecoin in 2013, memecoins have become a major part of the cryptocurrency world, making and ruining fortunes alike. Investopedia defines a memecoin as a cryptocurrency represented “with comical or animated memes, that are supported by enthusiastic online traders and followers.”

    Tyler Durden
    Sun, 05/07/2023 – 21:30

  • California Defaults On $18.6 Billion In Debt, Saddling Employers With The Expense
    California Defaults On $18.6 Billion In Debt, Saddling Employers With The Expense

    California’s recent decision not to pay back some $20 billion borrowed from the federal government to cover unemployment benefits during the pandemic will fall on the shoulders of employers, according to experts.

    California Governor Gavin Newsom (D)

    “The state should have taken care of the loans with the COVID money it received from the government in 2021,” said Marc Joffe, policy analyst at the Cato Institute—a public policy think tank headquartered in Washington, D.C., in a statement to the Epoch Times.

    In the state’s proposed 2023-2024 budget, $750 million was allocated to start paying down the loans, until Governor Gavin Newsom nixed the provision in early January, leaving businesses in the state responsible for the loans, as mandated by federal regulations – so that the federal unemployment tax rate of .6 percent will increase by .3% per year starting in 2023 until the loan is extinguished.

    “California is just not really an employer-friendly state,” said Joffe. “This one thing will not be a difference between a business remaining open or closing, but it’s just another burden on top of the many burdens the state puts on employers.“

    In total, 22 states borrowed money for unemployment insurance from the federal government. All but four, California, Colorado, Connecticut, and New York, have paid back their debts – with California owing the most by far at $18.6 billion as of May 2, followed by New York at $8 billion, Connecticut at $187 million and Colorado at $77 million, according to data from the US Treasury.

    More via the Epoch Times,

    Initially, the state borrowed from its reserves to pay the benefits, but after exhausting its coffers borrowed to cover expenses, analysts said.

    Exacerbating the situation were unprecedented levels of fraud occurring across the state, due to limited oversight and antiquated computer systems, according to Lee Ohanian, professor of economics at the University of California–Los Angeles.

    Analytics firm LexisNexis estimated the total cost of the fraud at $32.6 billion.

    Investigations have since uncovered that illegitimate unemployment benefits payments were paid to convicted felons, with one address receiving 60 separate fraudulent payments.

    Fraud is a persistent issue historically with the program, and a $2 million federal grant in 2013 sought to address the issue with new computer software systems.

    The upgrade successfully stopped instances of fraud, but further improvements stopped with the end of the grant in 2016, reportedly due to the agency’s reluctance to take on the annual expense for the third-party service.

    “They were penny wise and pound foolish,” Ohanian told The Epoch Times.

    At a cost of $2 million annual investment, the program would have cost $14 million to operate since it was terminated.

    “Sadly, this is just a trifecta of bad decisions,” Ohanian said. “The [Employment Development Department] made a bad decision to not renew its lease for the fraud detection software, the state government took out a loan and chose to welch on the debt—which is outrageous—and now businesses are repaying more in taxes for the incredibly unwise decisions and mistakes of the state government.”

    Reports that the state is seeking forgiveness from the federal government were met with resistance by policy experts, including Ohanian.

    “We’ve made a lot of bad decisions and we expect the rest of the country to pay for it,” he said. “It also raises questions about the future: If the state is going to default on the $20 billion federal loans, how safe are municipal bonds from California?”

    Tyler Durden
    Sun, 05/07/2023 – 21:00

  • Will Biden's Plan To Tax Crypto Mining Reduce Emissions? Critics Say No
    Will Biden’s Plan To Tax Crypto Mining Reduce Emissions? Critics Say No

    Authored by Luke Huigsloot via Cointelegraph.com,

    Cryptocurrency miners based in the United States could soon face a tax equal to 30% of the cost of electricity they use if President Joe Biden’s proposed budget for the fiscal year 2024 is approved by Congress, but the proposal has sparked debate about whether it would actually decrease global emissions and energy prices.

    Cryptocurrency mining is a resource-intensive process that attempts to solve increasingly complex equations in order to create new blocks which can then be validated and added to the blockchain.

    This process consumes a significant amount of energy, with some estimates placing the global energy consumption of Bitcoin mining alone at around 0.59% of the world’s energy usage, which is roughly equivalent to the energy usage of Malaysia, according to Worldometer.

    Biden’s  Council of Economic Advisors (CEA), argues that the tax — dubbed the Digital Asset Mining Energy (DAME) excise tax — “encourages firms to start taking better account of the harms they impose on society,” adding:

    “Estimated to raise $3.5 billion in revenue over 10 years, the primary goal of the DAME tax is to start having cryptominers pay their fair share of the costs imposed on local communities and the environment.”

    By imposing a tax on electricity usage crypto miners will have a financial incentive to reduce their energy consumption, and with electricity generation making up such a large proportion of carbon emissions, this should theoretically reduce emissions in the U.S.

    This idea is similar to the thinking behind carbon taxes, which are intended to disincentivize emitters by forcing them to pay the full social cost of their emissions after attempting to factor in costs associated with polluting.

    Leakage

    However, opponents of the tax argue that it will simply drive miners offshore to countries with lower tax rates and less stringent environmental regulations, where they will continue to emit large amounts of carbon dioxide. This situation is known as “carbon leakage,” whereby emissions are simply shifted from one location to another, rather than reduced overall.

    As Coin Metrics co-founder Nic Carter points out, these countries may also have a much lower proportion of energy supplied by renewable sources, so emissions may even increase as crypto miners move offshore.

    Carter was scathing in his critique of the policy, arguing that it would decrease tax revenue contrary to what the Biden administration suggests, increase carbon emissions, and empower “geopolitical enemies.”

    In its blog post, the CEA noted that “the potential for cryptomining to relocate abroad — such as to areas with dirtier energy production — is a concern” but suggested that other countries are also moving to restrict crypto mining, and cited nine countries that already had banned the activity.

    Speaking to Cointelegraph, environmental group Greenpeace USA’s Bitcoin project lead Joshua Archer warned that regulations or taxes deterring crypto mining will likely be created wherever crypto miners move to, and argued that Bitcoin should eliminate its proof-of-work consensus mechanism.

    The climate activism group has been calling for Bitcoin to transition to a proof-of-stake mechanism as part of its ongoing “change the code, not the climate” campaign which began early last year. 

    One of the countries referred to by the CEA, China, banned crypto mining in 2021 after citing concerns about its electricity consumption and environmental impact. However, studies on the effect of the ban suggest that activity had simply moved to countries that use far less renewable energy, and actually increased global emissions.

    The CEA also argued that crypto miner’s electricity usage drives up costs for other consumers, and increases overall reliance on “dirtier sources of electricity.”

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    While this makes sense according to economic theory, as an increase in demand within a market leads to higher prices, it may overlook some important nuances of the crypto-mining industry and its effect on the electricity market in the U.S.

    ‘Beauty of Bitcoin’

    Bitcoin miner Marathon Digital Holdings’s CEO Fred Thiel told Cointelegraph that “The beauty of Bitcoin mining is that it naturally incentivizes renewable energy generation.”

    Thiel elaborated that “In many cases, green energy sources — such as solar and wind farms — are only feasible if there is consistent demand for that energy when it is produced,” adding:

    “While most consumers’ energy needs fluctuate, miners act as consistent base load energy consumers. They help stabilize the grid, making new green energy projects financially feasible.”

    According to Thiel, while Bitcoin mining incentivizes the production of renewable energy generation, Bitcoin miners in the U.S. are also drawn to renewable energy sources, as the excess energy they produce which is unable to be returned to the grid is some of the cheapest energy available in the U.S.

    Thiel added that if this excess energy was not used by Bitcoin mining firms, it would not be able to be used by consumers and would otherwise be wasted.

    Thiel noted that this mutually beneficial relationship between renewable energy producers and Bitcoin miners is contributing to an already ongoing shift towards more sustainable sources of electricity, pointing to the most recent survey by the Bitcoin Mining Council (BMC).

    Based on the results of the survey, the BMC estimated that 58.9% of the electricity used in Bitcoin mining throughout the last quarter of 2022 was generated by renewable energy sources, a number that is increasing over time.

    Thiel was also very scathing of the DAME tax, arguing that “it is a shot at a specific industry, not at a specific practice or fuel source,” adding:

    “If the Biden Administration really wanted to reduce global emissions, it would target the ways electricity is generated – not arbitrarily target select industries that use it.”

    He said that the proposal “is intended to run Bitcoin miners out of business” and “will both raise energy prices for consumers and reduce the feasibility of renewable energy development in the U.S.,” concluding:

    “Either the administration is utterly misguided, or this proposed tax is nothing more than a move to hamper this industry for political reasons, because it is not in the interest of the people, the energy grid, or the environment.”

    The proposal comes amid calls that a lack of regulatory clarity and access to banking services in the U.S. is killing its crypto industry, and if the DAME tax is approved by Congress it may just be one more nail in the coffin.

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    Tyler Durden
    Sun, 05/07/2023 – 20:30

  • Desperate Dems Float 14th Amendment As Debt Ceiling Override
    Desperate Dems Float 14th Amendment As Debt Ceiling Override

    As yet another battle looms between Republicans and Democrats over the debt ceiling, a new piece of potential leverage has been floated – using the 14th Amendment as a last-ditch effort to avoid default.

    The amendment, aimed primarily at extending the Bill of Rights liberties to former slaves, includes a section which states that “the validity of the public debt of the United States … shall not be questioned,” with the implication that it would allow President Biden to unilaterally raise the debt ceiling.

    When asked on Friday during an MSNBC interview whether this option is on the table, Biden didn’t say no – just that we’ve “not gotten there yet.”

    Treasury Secretary Janet Yellen, however, said that relying on the 14th Amendment would create a “constitutional crisis.”

    “There is no way to protect our financial system in our economy, other than Congress doing its job and raising the debt ceiling and enabling us to pay our bills and we should not get to the point where we need to consider whether the President can go on issuing debt. This would be a constitutional crisis,” she told ABC‘s “This Week.”

    That said, she also didn’t rule it out.

    https://platform.twitter.com/widgets.jsYellen warned that if Congress doesn’t act to solve the issue, “we will have an economic and financial catastrophe that will be of our own making, and there is no action that President Biden and the U.S. Treasury can take to prevent that catastrophe.”

    White House aides have reportedly looked into the use of the Amendment in order to avoid default, The Hill reports.

    Lawmakers, on the other hand, say that default can only be avoided if a deal is reached between Biden and House Speaker Kevin McCarthy (R-CA). The pair are scheduled to meet on Tuesday for the first time since February in order to negotiate.

    Tyler Durden
    Sun, 05/07/2023 – 20:00

  • China Wants Killer Robots To Fight The Next War
    China Wants Killer Robots To Fight The Next War

    Authored by Andrew Thornebrooke via The Epoch Times (emphasis ours),

    War grips the world and the most powerful nations on earth go to battle once more. This time, however, it is machines that do the killing, operating free from all human oversight and accountability.

    A Chinese soldier salutes in front of a military drone during a parade to celebrate the 70th anniversary of the founding of the Chinese communist regime at Tiananmen Square in Beijing on Oct. 1, 2019. (Kevin Frayer/Getty Images)

    It’s a grim picture of future conflicts, but one that the Chinese Communist Party (CCP) is nevertheless working to make a reality.

    The CCP is investing in artificial intelligence (AI)-enabled platforms that it hopes will one day conduct lethal missions in wartime, wholly without human input or control.

    Gregory Allen, director of the Wadhwani Center for AI and Advanced Technologies at the Center for Strategic and International Studies, says the regime is moving well beyond any attempt to keep a human in the AI decision-making loop.

    “China is pursuing development of AI-enabled lethal autonomous weapons,” Allen wrote in a prepared testimony for an April 13 hearing of the U.S.-China Economic and Security Review Commission.

    “The best available indications … suggest that China’s strategy is ambitious, moving beyond any sort of on-the-battlefield human supervision into increasingly autonomous AI-enabled warfare.”

    Though the CCP is investing heavily in a broad array of new technologies, Allen says, AI is foremost among them. The regime’s capacity to build AI-driven machines of war is quickly reaching parity with that of the United States, and may even exceed it soon.

    “U.S. leadership in the realm of military AI is not at all guaranteed,” Allen says.

    “While the United States has important advantages, China may be able to quickly take the lead in government and military adoption of AI capabilities. This is an outcome that the United States should seek to prevent.”

    A picture taken on Nov. 14, 2017, shows a Chinese-made Wing Loong II drone on display during the Dubai Airshow. (Karim Sahib/AFP via Getty Images)

    Autonomous AI Platforms ‘Inevitable’

    The CCP’s pursuit of AI-driven weapons and other military platforms, though not well understood by many Americans, has been ongoing for years.

    Allen notes that he first realized the remarkable ambition of such goals back in 2018. At that time, he attended a conference where he transcribed a speech made by Zeng Yi, a senior executive at China’s state-owned military company Norinco.

    There, Zeng described Norinco’s ambitions—and the CCP’s expectations—for future implementation of AI weapons by saying that, “In future battlegrounds, there will be no people fighting.”

    “Zeng predicted that by 2025, lethal autonomous weapons would be commonplace,” Allen said, adding that Zeng had described the mass adoption of autonomous AI platforms as “inevitable.”

    Allen also noted that CCP censors removed Zeng’s comments and even his participation from the official readout of the conference shortly thereafter.

    “It was not in China’s interest to have that information in the open,” Allen said.

    Not long after that, however, the CCP-affiliated military company Ziyan began exporting its Blowfish A2 and A3 drones to the Middle East. The Blowfish, a helicopter-style drone capable of autonomously engaging with targets, using machine guns and missiles, was just the first realization of the regime’s ambition to transform war from a human domain into a robotic one.

    Military Decision-Making Without Humanity

    The regime’s ambitions for AI go beyond killer robots. The CCP is also investing to develop AI capabilities related to military decision-making and command and control.

    At the heart of the effort is the CCP’s goal of “intelligentization,” a transformation of warfare through the mass integration of AI, automation, and big data.

    Zeng posited that “intelligence supremacy will be the core of future warfare” and that “AI may completely change the current command structure, which is dominated by humans” to one that is dominated by an “AI cluster” that operates “just like the brain of the human body.”

    Building on that vision are Chinese companies like 4Paradigm, which was contracted by the CCP’s military wing to develop AI decision-making models and human-machine teaming software for use at the company and battalion levels.

    Such programs essentially aim toward one end: the restructuring of the Chinese military into an increasingly centralized cadre of officers who direct swarms of AI-enabled autonomous systems to do the actual fighting.

    Sam Kessler, an analyst for the North Star Support Group risk advisory firm, believes that the regime’s focus on shifting the burden of warfighting from humans to AI-enabled systems is indicative of a broader recognition among CCP leadership about the revolutionary nature of intelligent autonomous systems.

    “The [Chinese military] places a great deal of emphasis on disruptive technologies like autonomous systems,” Kessler said in an email to The Epoch Times.

    “Unmanned combat systems with digitized decision-making programs can potentially speed up the process of performing tasks on the battlefield,” Kessler added. “[These include] precision strikes, accurate reconnaissance, resupplying forces, and performing field modifications more precisely and effectively.”

    Such capabilities, Kessler said, could provide even a meager military with a profound force multiplier, and could shift the balance of power in future conflicts.

    “Whoever possesses this kind of technology can help make even the weakest or average conventional military power have an edge in a field of battle, or prolonging it,” Kessler said.

    Read more here…

    Tyler Durden
    Sun, 05/07/2023 – 19:30

  • California Approves Reparations Recommendations, Proposing $1.2 Million Checks For Black Residents
    California Approves Reparations Recommendations, Proposing $1.2 Million Checks For Black Residents

    California is grappling with many crises, including soaring crime, a growing homeless population, out-of-control drug overdoses, a giant budget shortfall, a population and business exodus, and a power grid teetering on the edge of failure. But instead of progressive lawmakers addressing these problems and making life better for the tens of millions of Americans who currently live in the state, they are focused on reparations. 

    On Saturday, California’s nine-member Reparations Task Force approved recommendations for how state officials should compensate and apologize to Black residents for past injustices. The task force has spent the last two years deliberating on payment recommendations that will now be sent for final approval in Sacramento before a July 1 deadline. 

    “Reparations are not only morally justifiable, but they have the potential to address long-standing racial disparities and inequalities,” Rep. Barbara Lee (D-Calif.) said during the meeting last night in Oakland. 

    California task force’s recommendations would mean a 71-year-old Black resident, living in the Golden State for their entire life, could receive a $1.2 million compensation check if the recommendations are passed into law. 

    Several economists working with the task force have developed these reparation estimates:

    One such estimate laid out in the report determined that to address the harms from redlining by banks, which disqualified people in Black neighborhoods from taking out mortgages and owning homes, eligible Black Californians should receive up to $148,099. That estimate is based on a figure of $3,366 for each year they lived in California from the early 1930s to the late 1970s, when federal redlining was most prevalent.

    To address the impact of over-policing and mass incarceration, the report estimates, each eligible person would receive $115,260, or about $2,352 for each year of residency in California from 1971 to 2020, during the decades-long war on drugs. –The New York Times 

    The task force’s recommendations didn’t include the total costs of reparations which could be more than $500 billion, based on estimates from economists. 

    “The initial down payment is the beginning of a process of addressing historical injustices,” the recommendations reads, “not the end of it.”

    Residents at the meeting demanded $200 million in direct cash payments for each Black resident. 

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    AmericanThinker’s Chris Talgo pointed out that reparation payments and other government handouts won’t close the wealth gap, “it arguably will make it worse.”

    Talgo explained:

    Consider. Since the start of President Lyndon B. Johnson’s “war on poverty,” the federal government has spent $22 trillion on various wealth redistribution programs. Yet, over that span, the rate of poverty remains unchanged.

    Perhaps this is because giving some people other people’s money is an incentive for the former to remain indolent. In other words, government checks breed dependence on government.

    On the other hand, if California lawmakers were actually interested in addressing the plight of many of the Black residents who live in the Golden State, they ought to take a forward-looking approach that would include an increased police presence, a tough on crime approach, lower taxes, fewer regulations, and commonsense policies that would make energy affordable and abundant.

    And, if these same lawmakers were really audacious and genuinely wanted to throw a wrench into the cycle of poverty that has entrapped so many Black Californians, they would do everything in their power to ensure that universal school choice was the norm in the Golden State. It also would help if these so-called leaders addressed the elephant in the room: the breakdown of the Black family, which is arguably the biggest driver of poverty and so many other societal problems.

    He continued:

    However, these are difficult conversations for leftist lawmakers, who always view more government wealth redistribution as the answer to everything. It is much easier for politicians to propose a superficial solution, like reparation payments, even though time has shown that giving people money doesn’t solve deep-seated, complex problems. 

    What’s troubling is that a California lawmaker has already declared a comprehensive reparations plan “will be a blueprint for America.” 

    Tyler Durden
    Sun, 05/07/2023 – 19:00

  • Biden Admin 'Building Lawful Pathways' For Immigrants After Title 42 Ends: Mayorkas
    Biden Admin ‘Building Lawful Pathways’ For Immigrants After Title 42 Ends: Mayorkas

    Authored by Mimi Nguyen Ly via The Epoch Times (emphasis ours),

    As the end of Title 42 nears, the Biden administration is encouraging immigrants to take up more legal pathways to enter the country, or face new and expedited deportation processes.

    Department of Homeland Security Sec. Alejandro Mayorkas (2nd-L) speaks at a press conference in Brownsville, Texas, on May 5, 2023. (Michael Gonzalez/Getty Images)

    Such deportation processes are set to come with the implementation of a new rule the administration is set to finalize soon. The rule would deny asylum to many immigrants who are caught crossing the southern border illegally.

    The new regulation “provides that individuals who do not access our lawful pathways will be presumed ineligible for asylum and will have a higher burden of proof, to overcome that assumption of ineligibility,” Homeland Security Secretary Alejandro Mayorkas said at a press conference on Friday.

    The move is part of the Biden administration’s plan to curb an anticipated rise in illegal immigrants at the U.S.-Mexico border starting May 11, when Title 42 will be lifted. The date also marks the end of the U.S. COVID-19 public health emergency.

    Title 42, part of the Public Health Service Act of 1944, was implemented under the Trump administration in March 2020. It allows for blocking asylum claims and swift expulsion of most unauthorized border crossers under the grounds of keeping contagious diseases out of the United States.

    Under Title 42, border agents were able to rapidly send back many illegal immigrants to Mexico, which helped stem the spread of COVID-19 in crowded detention settings.

    When Title 42 is lifted, all illegal immigrants will be processed under the Title 8 immigration law.

    From Title 42 to Title 8

    “In a post-Title 42 environment, we will be using our expedited removal authorities under Title 8 of the United States Code. That allows us to remove individuals very quickly,” Mayorkas said on Friday.

    The U.S. State Department and U.S. Department of Homeland Security (DHS) said in a fact sheet last week the country will double or triple the number of deportation flights to some countries and aim to process migrants crossing the border illegally “in a matter of days.”

    Title 8 is a federal law that allows expulsions if illegal immigrants don’t qualify for asylum. The process to remove an illegal immigrant under Title 8 currently takes longer compared to Title 42.

    Rep. Henry Cuellar (D-Texas), a Democrat, recently told The Epoch Times that under Title 42, illegal immigrants “can come right back” to the United States, because “there are no repercussions” after they are expelled.

    But “Under Title 8, there are some teeth, which means if someone is deported, there will be a five-year, 10-year, 15-year, 20-year ban or more, which means they cannot come back into the country,” he said.

    Separately, the Mexican government will step up border security in southern Mexico as part of an agreement reached this week, Mayorkas said. Mexico’s Defense Ministry said it did not have information on the matter.

    Also ahead of Title 42’s end, the Biden administration is expanding access to CBP One, an app that allows migrants to schedule an appointment to approach a border port of entry. Beginning May 12, roughly 1,000 appointments will be available each day, according to U.S. Customs and Border Protection (CBP).

    Read more here…

    Tyler Durden
    Sun, 05/07/2023 – 18:30

  • Mayhem Unfolds In Oakland As Soros-Backed DA Fails To Enforce Law And Order
    Mayhem Unfolds In Oakland As Soros-Backed DA Fails To Enforce Law And Order

    The Oakland Police Department is investigating a violent and chaotic “sideshow” that ended up with a mob torching a car and someone plowing another vehicle into it. 

    A video posted on Twitter shows the scary scene unfolding late Friday night near the intersection of Oak Street and 10th near the Oakland Museum of California. 

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    In a series of tweets, journalist Michael Shellenberger said the proliferation of dangerous sideshows results from “a progressive D.A. who has stopped enforcing many laws.” 

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    Shellenberger said police are powerless to stop “criminal sideshows because @MayorShengThao & DA Pamela Price refuse to prosecute “nonviolent crimes””. 

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    He pointed out District Attorney Pamela Price is Soros-backed. 

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    Another sideshow was down the street from Mark Zuckerberg’s mansion in San Fransico. 

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    Lawlessness is spreading like cancer throughout the progressive-run Bay Area. 

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    These shocking scenes stem from progressive city leadership’s inability to maintain law and order. Similar occurrences have recently been observed in cities like Baltimore and Chicago, where groups of young people wreak havoc on city streets. As they say… stay out of the cities.

    Tyler Durden
    Sun, 05/07/2023 – 18:00

  • Downtown San Francisco Becomes A Ghost Town As Major Retailers Flee
    Downtown San Francisco Becomes A Ghost Town As Major Retailers Flee

    Authored by Mike Shedlock via MishTalk.com,

    Retailers abandon downtown San Francisco in droves. Nordstrom is the latest, signaling  the death of the area…

    That image from the Tweet below is from April 29. Since then, there have been more closures…

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    Nordstrom closes two stores and Saks Off 5th says goodbye as well.

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    Walgreens and Whole Foods Leave

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    San Francisco’s Dying Downtown

    The San Francisco Standard says Nordstrom’s Exit From San Francisco Calls Downtown Mall’s Future Into Question

    The Nordstrom at Westfield will close at the end of August, the company confirmed on Tuesday. The retailer’s exit will leave a gaping vacancy that could be very difficult to fill: the store sprawls across 312,000 square feet and five floors. A Nordstrom Rack across the street is also slated to close in July. 

    Less than a month ago, a nearby Whole Foods abruptly shuttered, citing employee safety concerns. The Whole Foods had made regular emergency calls since it opened in March 2022 for a mix of medical crises, assaults and other incidents; in September of last year, a man fatally overdosed in a bathroom at the grocery store. 

    Last week, a Walgreens store next to Westfield mall was the scene of a fatal shooting after a private security guard allegedly shot a shoplifter.

    So far this year, police have responded to 74 reports of petty thefts, 54 fights and 30 grand thefts in the area.

    Call Out the Guard

    Zerohedge comments Gov. Newsom Activates National Guard And Highway Patrol To Combat San Francisco’s Drug Crisis

    Gov. Gavin Newsom has called up the California Highway Patrol and the California National Guard to combat San Francisco’s out-of-control open-air drug market as parts of the progressive-run city descend into chaos.

    According to ABC7 News, CHP officers will be deployed across Tenderloin and South of Market neighborhoods, while guardsmen will run intelligence analysis operations behind the scenes. The governor brought the two agencies together as the drug-related deaths in the city jumped 41% in the first quarter. 

    San Francisco Ghost Town

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    “It’s been completely surreal watching a major city like San Francisco become a ghost town in real time. Tons of restaurant and business closures. Way less commuters. Empty buildings everywhere. All the tech companies bounced and people got priced out. Just a hollow city now.”

    Q&A on the Exodus

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    Other than A through F downtown San Francisco is a great place to be.

    *  *  *

    Like these reports? I hope so, and if you do, please Subscribe to MishTalk Email Alerts.

    Tyler Durden
    Sun, 05/07/2023 – 17:30

  • Fox Sends Cease-And-Desist Letter To Media Matters Over Leaked Tucker Tapes
    Fox Sends Cease-And-Desist Letter To Media Matters Over Leaked Tucker Tapes

    Fox Corporation, parent company of Fox News, has sent a cease-and-desist letter to Media Matters over a series of leaked tapes featuring former Fox anchor Tucker Carlson.

    “That unaired footage is Fox’s confidential intellectual property; Fox did not consent to its distribution or publication; and Fox does not consent to its further distribution or publication,” wrote Fox’s law firm, Wilson Sonsini Goodrich & Rosati, in a May 5 letter to MMFA. “This proprietary material was given to you without Fox’s authorization. Fox demands that Media Matters cease and desist from distribution, publication, and misuse of Fox’s misappropriated proprietary footage, which you are now on notice was unlawfully obtained. We reserve all rights and remedies.”

    In one clip, Carlson made a sex joke with Piers Morgan (gasp!).

    “If we’re going to talk about sex, I’d love to hit some of the fine points of technique, but, you know, but it’s your show. It’s totally up to you,” says Carlson, to which Morgan replies without skipping a beat: “We can certainly talk about your sexual technique, especially after your tanning testicles last week,” referring to a joke Carlson made about a reported decline in testosterone levels.

    “Not mine,” Carlson replies, adding “We’ll speak in more general terms, but I’ve got something to add.”

    https://platform.twitter.com/widgets.jsIn another, Carlson calls a Dominion Voting Systems lawyer a “slimy motherfucker.”

    And in yet another clip (which Fox may have hated the most), Carlson slams Fox Nation – saying “Nobody watches Fox Nation because the site sucks. So I’d really just like to dump the whole thing on YouTube.”

    MMFA CEO Angelo Carusone told the Epoch Times in response: “Reporting on newsworthy leaked material is a cornerstone of journalism. For Fox to argue otherwise is absurd and further dispels any pretense that they’re a news operation.”

    “Perhaps if I tell them that the footage came from a combination of WikiLeaks and Hunter Biden’s laptop, it will alleviate their concerns.”

    More via the Epoch Times,

    Journalist Megyn Kelly, a former primetime Fox News anchor, blamed her previous employer for leaking the footage, specifically.

    “Ask yourself about my theory that this is Fox News doing it to him, that it’s Irina Briganti, who sat there calling through his commercial downtime to look for anything,” said Kelly, referring to Fox News’ senior executive vice president of corporate communications.

    “If this is all you got, you lost your fastball. I can’t wait for the tape that absolutely sinks him because this is absurd,” she continued. “So far you made Fox Nation look bad. You’ve made Tucker look good on his ripping on Media Matters for America. And you’ve made Tucker look good because he’s obviously a funny guy who mocks his enemies and makes [it] clear that he understands you might be taping him!”

    Bill O’Reilly, who preceded Carlson in Fox News’ 8 p.m. ET weeknight slot, said on NewsNation on May 3 that the leaking was most likely by someone at Fox News in order to make Carlson look like “a racist villain.”

    Fox has refuted allegations of its involvement in the leaks. “This is completely false and an outright lie,” a spokesman said on Wednesday.

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    Tyler Durden
    Sun, 05/07/2023 – 17:00

  • Why China & Its Trading Allies Are Well Placed To Topple The Dollar
    Why China & Its Trading Allies Are Well Placed To Topple The Dollar

    Authored by Wolfgang Munchau via NewStatesman.com,

    After decades meting out sanctions and financial coercion, the US may soon feel its grip on world trade beginning to loosen…

    Change is good, but dollars are better, a US author of romance novels once wrote. A similarly light-hearted sentiment often inspires discussions about the future role of the US dollar as the world’s leading currency. The consensus view is that the dollar is safe. I think the consensus is wrong.

    The dollar is the foundation of US global leadership, and the future of the dollar is therefore intricately linked to the debate about geopolitical fragmentation. 

    Brazil’s president, Luiz Inácio Lula da Silva, asked during his recent visit to China:

    “Why should every country have to be tied to the dollar for trade?… Who decided the dollar would be the [world’s] currency?”

    These are good questions.

    The perhaps surprising answer is that he himself made that decision, together with the former leaders of the other “Brics” group of nations: Brazil, Russia, India, China and South Africa. Their economic-development models have succeeded but have also critically depended on the US dollar. During the period of hyperglobalisation – which I date from 1990 to 2020 – the US became the global importer of last resort, and let its trade deficit against the rest of the world increase. China and many other fast-developing economies built up savings in the currency they were paid in – the US dollar. They invested those savings into US bonds and other assets. The willingness of the US to absorb the world’s savings surpluses was the engine of globalisation. It ensured that the dollar would maintain its status as the world’s leading currency.

    This mechanism explains what happened in the last 20 years, but it won’t tell us what will happen in the next 20. Yet the dollar fans assume that the geopolitical and geo-economic environment will stay broadly the same.

    If the five Brics countries wanted to end their dependence on the dollar, they would have to do more than just choose another currency to trade in. It is not a menu choice, as Lula suggested during the same speech. He and his fellow Brics leaders would have to change how they interact with the rest of the world, and with one another.

    China is key. In 2021, the country derived 43 per cent of its GDP from investment. This is approximately twice the level of the US and other Western countries. If China managed to shift some of its GDP to consumption, it would reduce its external trade surplus, as consumers tend to buy more imported goods. If you wanted to be less reliant on the US dollar, this is where you would have to start. As a second step, China and the other Brics countries could start trading more with each other, become more self-reliant in their supply chains, and set up their own financial infrastructure.

    Changing economic models is hard. Three years after Brexit, the UK is still struggling to move away from a model that depended on close integration with the EU. Germany is finding it hard to maintain competitiveness without cheap Russian gas and with impaired global supply. It takes decades to build industrial production lines and supply chains. In China, there are an awful lot of vested political interests at the regional level, which rely on the investment boom continuing. If President Xi Jinping was really keen to extricate China from the US dollar, he would need to impose policies that would meet with resistance from regional leaders. In parallel, China would also have to start a long process of shifting at least part of its $3.2trn worth of foreign reserves held in dollars into other currencies. All of this would take a long time – one or two decades, perhaps.

    The reason I think China, Brazil and others will ultimately go down that difficult route is the overuse of economic sanctions by the US. When the war in Ukraine began, the first decision taken by the Western alliance was to freeze Russia’s central-bank reserves held in the West. Previously, the US had threatened German firms involved with the Nord Stream gas pipeline, by cutting off their and their banks’ entire dollar cash-flows. If two people transact in dollars via their banks, at some point the transaction goes through US jurisdiction. This is why it is possible for the US to impose sanctions in the first place.

    It was the Obama administration that began developing dollar-based economic sanctions as a primary policy tool. Dollar sanctions have since become a mainstay of US diplomacy. The most insidious version are so-called secondary sanctions. European companies, for example, were forced to comply with US sanctions against Iran because they would otherwise have lost access to dollar markets. On top of those financial sanctions, the US has become far more aggressive in the use of targeted trade sanctions. The Trump administration banned Huawei. The Biden administration has banned high-performance semiconductor sales to China. The EU is also now cautiously starting to subject trade policy to geopolitical considerations.

    Sanctions can bring short-term policy successes, but they come with a long-term cost that is often not accounted for. That cost will be a reduced role for the dollar as the world’s largest currency. Sanctions give incentives to countries to reorganise their economies. We are seeing this happening in Russia right now.

    Having the world’s leading currency is an “exorbitant privilege” – an expression often attributed to Charles de Gaulle. But if you use a privilege too often it ceases to be seen as a privilege and begins to lose its value. This is the mechanism I see at work here.

    This is the non-fiction version of a story in which dollars are not better after all.

    Tyler Durden
    Sun, 05/07/2023 – 16:30

  • Basel IV Rules Are Coming And Will Make Bank Lives Even More Difficult
    Basel IV Rules Are Coming And Will Make Bank Lives Even More Difficult

    Following up on the earlier Morgan Stanley note predicting that new regulatory rules will significantly and adversely impact new credit creation and will further tighten bank lending standards, Morgan Stanley analysts expect the Fed to publish new bank-capital rules between late May and early July, followed by a comment period, and ultimately a Final Rule, that would be phased in over time between 2025-27.

    They expect implementation of this “Basel III Endgame,” also known as Basel IV, to drive up risk-weighted assets (RWAs) and capital requirements for their US Large-Cap Banks coverage, with the greatest impact on Global Systemically Important Banks (GSIBs).

    While the analysts acknowledge that they can’t assess the exact impact until the final rules come out, after triangulating data from numerous Bank for International Settlements publications , they conclude that Common Equity Tier 1 Capital (CET1) ratios in their US GSIB coverage could decrease by a weighted average 0.7% (range 0.5-1.4%) in a more moderate “Scenario 1”…

    … and by 1.2% (range 0.9-1.9%) in a tougher “Scenario 2.” (for more please see “Basel III Endgame is Coming… Get Ready for Tougher Capital Requirements” available to professional subscribers).

    Separately, and in keeping tabs on the ongoing debt crisis, Morgan Stanley refreshed its analysis of excess capital for our Large Cap Banks and Consumer Finance coverage. 1Q23 excess capital levels versus regulatory minimums at the median bank increased 13% q/q, but at the Money Centers excess capital decreased a median 16%, driven by declines at C and GS.

    Bottom line: MS estimates some $153B of excess capital across the group vs. regulatory minimums as of 1Q23.  Commentary from this earnings season suggests that managements are shifting into capital build mode as macro risk rises and as regulators are expected to impose tougher capital requirements on the industry.

    For more see “How Much Excess Capital Do Banks Have?”

     

    Tyler Durden
    Sun, 05/07/2023 – 16:00

  • Like A Tweet, Lose Your Job
    Like A Tweet, Lose Your Job

    Via The Brownstone Institute,

    The president of Thomas Jefferson University may lose his job for liking tweets from Alex Berenson on his personal account. The episode marks a warning against those in mainstream institutions that any deviation from prevailing orthodoxy – no matter how minor – will not be tolerated. 

    Mark Tykocinski, a Yale trained molecular immunologist, became president of the university in 2022. Last week, a reporter from The Philadelphia Inquirer went through his personal Twitter account which had under 300 followers. 

    The Inquirer reported that Dr. Tykocinski had liked tweets from Berenson that criticized transgender surgeries for children and the efficacy of mRNA Covd vaccines. 

    “Two years after their introduction, the mRNAs Covid vaccines have proven to be what we all should have expected,” one tweet from Berenson argued.

    “Another in a long line of overhyped, rushed, profit-driven Big Pharma flops with weak long-term efficacy and a lousy side effect profile.”

    This constituted a media and academic scandal. The reporter demanded an explanation, and Tykocinski’s colleagues rebuked his transgression. Thomas Jefferson University CEO Joseph G. Cacchione wrote to faculty, employees, and students that Tykocinski “should have known better” than to like those tweets. 

    Even self-professed defenders of free speech joined the chorus of reprimands. Jonathan Zimmerman is a professor at the Pennsylvania Graduate School of Education and the author of Free Speech: And Why You Should Give a Damn. In 2021, he defended Georgetown Law adjunct professor Sandra Sellers after she was fired for noticing that black students underperformed in her class.

    “Georgetown’s official policy on speech says it is ‘committed to free and open inquiry, deliberation and debate in all matters.’ It has now carved out an exception for matters of race, which are essentially closed,” he wrote.

    “The lesson [from Georgetown] is clear and unequivocal: Keep your big mouth shut, if you know what’s good for you.”

    Now, Zimmerman has discovered his own carve-out – wrongthink related to Covid and juvenile transgender procedures.

    “If he liked those tweets because he agrees with Alex Berenson, that is a dagger at the heart of the scientific enterprise,” Zimmerman told the Inquirer.

    “There’s no other way to describe it.” 

    “I have sworn upon the altar of god eternal hostility against every form of tyranny over the mind of man,” then-Vice President Thomas Jefferson wrote in 1800. Now, the university that bears his name has declared hostility against its president for social media wrongthink. 

    But the attack is not directed at Dr. Tykocinski. It is a warning against anyone in institutions that they must conform to prevailing orthodoxy or risk their professional reputations. They must keep their big mouths shut, in the words of Professor Zimmerman. In this system, career advancement relies on obedience rather than ingenuity. It is no wonder that our ruling class is so banal. 

    By silencing critics, the powerful aim to achieve authority without accountability. Submission is central to their quest for power, and threatening the livelihoods of freethinkers is a powerful ploy. 

    Berenson’s reporting and support from public figures like Jay Bhattacharya and Elon Musk may save Dr. Tyconski’s job for now; but going forward, he’ll know the price that he will bear if he deviates from groupthink. He didn’t have to say anything to learn this reality. He didn’t make a post or deliver a speech. All it took was liking a tweet from a journalist. 

    Free speech is more than a slogan. It must be an operational reality for everyone. It can be closed down by forces other than edicts from government. It can be suppressed also by arbitrary private actions that reflect regime priorities. Ever more workers and especially intellectuals today work in an environment of fear that leads to self-censorship. 

    There are many ways to skin a cat and many paths toward despotism. Canceling the capacity of competent professionals to dissent against the state-subsidized orthodoxy is one. 

    Tyler Durden
    Sun, 05/07/2023 – 15:30

  • Buffett Turns Gloomy: The "Incredible Period" For The US Economy Is Coming To An End
    Buffett Turns Gloomy: The “Incredible Period” For The US Economy Is Coming To An End

    While Warren Buffett’s insights on the economy are traditionally cheerful and uplifting – usually hitting at time of peak pessimism in the form of self-serving NYT op-eds or CNBC vignettes (and usually around the time the Omaha billionaire knows that the government will backstop his TBTF investments, unlike those of pretty much anyone else), on Saturday the head of Berkshire Hathaway had a far more downbeat and gloomy prediction for his own businesses – and the broader economy in general – the good times may be over.

    Speaking at Berkshire’s annual general meeting in Omaha, Nebraska, the billionaire investor said he expects earnings at the majority of the conglomerate’s operations to fall this year as the coming economic downturn slows corporate activity further. He made his pessimistic comments even as Berkshire posted an almost 13% gain in operating earnings to $8.07 billion for the first quarter, up from $7.04 billion a year ago.

    “The majority of our businesses will report lower earnings this year than last year,” Buffett, 92, said, before crowds of thousands at the event on Saturday according to Bloomberg. During the last six months or so, the “incredible period” for the US economy has been coming to an end, he said.

    As Bloomberg notes Berkshire is often viewed as a proxy for economic health owing to the expansive nature of its businesses ranging from railroad to electric utilities and retail. Buffett himself has said Berkshire owes its success to the incredible growth of the US economy over the decades, but his prediction for a slowdown at his firms comes as upheaval at regional banks threatens to curtail lending as inflation and higher rates continue to bite.

    Buffett’s long-time business partner Charlie Munger, 99, who joined him on stage, said the more-difficult economic environment will also make it harder for value investors, who typically buy stocks that look cheap compared to the intrinsic value of the businesses.

    “Get used to making less,” Munger said.

    Despite the broader pessimism, Buffett said he expects earnings at its insurance underwriting operations — which are less correlated to business activity — to improve this year. Berkshire already reported higher earnings at those businesses including auto-insurer Geico, which swung to profitability following six quarters of losses.

    Geico posted $703 million in earnings as higher average premiums and lower advertising spending contributed to the gain even as claim frequencies fell, Berkshire said in a statement reporting its earnings Saturday. That revival follows a difficult period for the underwriting business as inflation took its toll on the cost of materials and labor.

    Geico has been facing particular pressure from rivals including Progressive, which Buffett has called “well-run,” and Allstate which had long used telematics programs to track drivers and encourage better behavior before Geico introduced the offering. Geico’s profit also helped Berkshire’s insurance underwriting businesses deliver $911 million in profit compared with $167 million a year earlier.

    Berkshire previously said it expected Geico to return to operating profitability in 2023, after securing premium rate increases. Still, Geico remains an issue for Berkshire, with top line growth in the quarter of less than 1% that “significantly lags peers,” CFRA analyst Cathy Seifert said.

    “I suspect rate hikes being put through to offset claim cost inflation is being met with policy cancellations,” she said. “While the loss of unprofitable policies is not always a bad thing- that’s not usually the policies — and policyholders — that leave.”

    Other parts of the conglomerate took a bigger hit, with after-tax earnings from Berkshire Hathaway Energy falling 46.3% from the same time last year amid “lower earnings from the US regulated utilities, other energy businesses and real estate brokerage businesses.” Railroad results were also weaker than expected due to a fall in freight volumes and higher operating expenses, according to Edward Jones analyst Jim Shanahan.

    But at one of Berkshire’s best known businesses, Brooks Running Co., Chief Executive Officer Jim Weber was skeptical of a steep consumer downturn.

    “With unemployment being so low, it’s hard to be believing we’re going to fall off a cliff into a recession at the consumer level,” Weber said in an interview on Friday ahead of the meeting. “I wonder if this is going to be an asset-value recession.”

    Among other topics discussed on Saturday were Buffett’s succession, the banking crisis, the US debt ceiling crisis, the company’s investment in Occidental, Chna’s upcoming invasion of Taiwan and more:

    • Succession planning: Buffett named Greg Abel, 60, as heir apparent in 2021, and the vice chair for non-insurance operations has had a more pronounced presence ever since. On Saturday, Buffett reaffirmed he was “100% comfortable” with the decision and even indicated a largely business-as-usual transition, for whenever that could be. “Greg understands capital allocation as well as I do. That’s lucky for us,” Buffett said at the meeting in Omaha, Nebraska. “He will make those decisions, I think, very much in the same framework as I would make them. We have laid out that framework now for 30 years.”
    • Occidental control: One analyst called it the biggest announcement of the day: Berkshire won’t make an offer for full control of Occidental Petroleum Corp., the energy firm it has spent months boosting its wagers on. The comment by Buffett likely helped temper speculation that Berkshire is seeking to own Occidental after winning approval from US regulators last year to acquire as much as 50% of the firm. Buffett didn’t rule out buying more stock of the Houston-based firm, adding it may — or may not — seek further purchases.
    • Banking Turmoil: Buffett and Munger were so sure they’d be questions about the recent banking turmoil that they jokily brought placards bearing the accounting classifications spotlighted during the upheaval. One was labeled “available for sale,” while the other read “held to maturity.” Striking a more serious note, Buffett faulted the executives in charge of the failed banks, arguing they should be held accountable for mistakes that were hiding in “plain sight.” He also called out “messed up” incentives in banking regulation, as well as poor messaging by regulators, politicians and the press to the American public about the upheaval. Buffett pointed to First Republic Bank, the insolvent bank which last weekend was acquired by JPMorgan after it collapsed after  offering jumbo, non-government-backed mortgages at fixed rates that were interest-only for 10 years in some cases — which Buffett called “a crazy proposition.”… “It was doing it in plain sight and the world ignored it ‘til it blew up,” Buffett said.
    • Debt Ceiling: As lawmakers race to resolve a standoff around the US debt ceiling, Buffett said he couldn’t see how Washington would allow the US to default on its debt, an outcome that would tip the financial system into turmoil. Investors and politicians are zeroing in on whether or not the US government can avoid crashing into its statutory debt ceiling and a potentially catastrophic technical default that could follow. Despite the impasse, Buffett reiterated his belief in America as an “incredible society” with “everything going for us.” Given the choice, he would still want to be born in the US, he said.
    • Geopolitics, Taiwan:  In Q4 Buffett slashed his holding of Taiwan Semi just months after disclosing a major stake in a quick reversal that spooked investors. Buffett said Saturday the company was one of the best managed and most important in the world, but that he didn’t like the location — a reference to Taiwan amid rising tensions between the island and China. Buffett and Munger emphasized the need for smooth relations between the US and China and urged increased trade. While the two will be competitive, they will always need to judge “how far you can push the other guy without them reacting wrong,” Buffett said.

    Separately, Berkshire topped up its cash pile, ending the quarter with $130.6 billion, a $2 billion increase from the $128.6 billion at the end of the year. This means that Berkshire stands to make a bonanza from interest income as the Fed keeps hiking rates: “Our investment income is going to be a lot larger this year than last year, and that’s built in,” Buffett said at the annual meeting.

    The company was also a net seller of equities for the second quarter in a row, pocketing $10.4 billion in net stock sales ($13.3 billion gross) after deducting purchases of $2.9 billion.

    Finally, Berkshire bought back $4.4 billion of stock, an increase from the same period last year, as Bekrshire confronted turbulent markets that offered fewer of the blockbuster deals he’s renowned for. Berkshire has turned toward buybacks more often as valuations in public markets had made it more challenging for Buffett to identify promising acquisitions.

    Tyler Durden
    Sun, 05/07/2023 – 15:00

  • Georgia Passes Law To Crack Down On 'Far-Left' Prosecutors Who Are Soft On Crime
    Georgia Passes Law To Crack Down On ‘Far-Left’ Prosecutors Who Are Soft On Crime

    As of Friday, Georgia will no longer cater to “far-left prosecutors” who are soft on crime, after Republican Governor Brian Kemp signed a bill into law establishing the Prosecuting Attorneys Qualifications Commission (PACQ), part of a broader GOP thrust to get tougher on crime and make communities safer, the Epoch Times reports.

    “My No. 1 priority is public safety across our state,” said Kemp, whose office described the commission as a “valuable oversight mechanism” that ensures the duties of state officials are fulfilled.

    The Commission will be comprised of eight members, six of whom will be current or former prosecutors, and two other lawyers, who will oversee district attorneys and solicitors general.

    “The creation of the PACQ will help hold prosecutors driven by out-of-touch politics than commitment to their responsibilities accountable and make our communities safer,” said Kemp.

    The new commission has the authority to investigate alleged misconduct by district attorneys and solicitors-general and discipline or remove them entirely if they meet the conditions for removal, which include “willful and persistent failure to carry out statutory duties” and conduct that is “prejudicial to the administration of justice.”

    Republicans across the country have pushed measures to rein in progressive prosecutors who they see as being soft on criminals by declining to prosecute certain crimes. -Epoch Times

    “As hardworking law enforcement officers routinely put their lives on the line to investigate, confront, and arrest criminal offenders, I won’t stand idly by as they’re met with resistance from rogue or incompetent prosecutors who refuse to uphold the law,”” said Kemp.

    State Democrats unsurprisingly opposed the law, arguing that the Republican legislative majority was looking for ways to impose its will on Democratic voters.

    “I strongly oppose an excessive and unnecessary commission as district attorneys are already held accountable under existing laws and through the current democratic process of holding election,” said Deborah Gonzalez, Democratic district attorney for Athens-Clarke and Oconee counties, who has declined to prosecute drug crimes involving marijuana.

    Republicans go after “rogue” prosecutors

    Georgia’s new commission comes amid a fight by Republicans against “rogue” district attorneys, often funded directly or indirectly by billionaire agent of chaos, George Soros.

    “The inability to ensure public safety and protect communities is occurring at every level of state government,” Reps. Steve Scalise (R-La.) and Scott Fitzgerald (R-Wis.) wrote in an op-ed. “By cracking down on rogue prosecutors who favor criminals over victims, we can ensure that no one else is put in harm’s way as a result of Democrats’ negligence.”

    According to former President Donald Trump, “Soros prosecutors appear to be engaging in selective enforcement based on illegal racial discrimination” in major Democratic strongholds such as Chicago, San Francisco, and Los Angeles.

    Trump has vowed to target Soros prosecutors if he’s elected president again in 2024, and has vowed to “overhaul” the Department of Justice.

    “They are Marxist in many cases,” said Trump, who pledged to appoint around 100 US attorneys who are the “polar opposite” of the “Soros district attorneys and others being appointed around the United States.”

    On Thursday, a progressive prosecutor who was notoriously funded by far-left billionaire George Soros announced her resignation, after months of bipartisan pressure to do so.

    Fox News reports that Kim Gardner, the Circuit Attorney for St. Louis, announced that her resignation will be effective June 1st. Gardner was one of the first prosecutors in the country to be bankrolled by Soros, who has since expanded his efforts to other major cities across the country. She was first elected in 2016 and re-elected in 2020, largely due to Soros’ financial backing. Prior to her resignation announcement, she had declared her intention to run for a third term in 2024.

    Tyler Durden
    Sun, 05/07/2023 – 14:00

  • US Heading Toward Power Grid 'Reliability Crisis,' Energy Commissioner Warns
    US Heading Toward Power Grid ‘Reliability Crisis,’ Energy Commissioner Warns

    Authored by John Haughey via The Epoch Times (emphasis ours),

    There were approximately 10,000 energy projects in April designed to produce more than 2,000 gigawatts (GW) of collective power waiting for permits from federal and state agencies to connect to electric grids across the United States.

    The problem is, that is nearly twice the collective electricity output of the 1,250 GW now being produced by all the nation’s power plants, most of which were built to generate power using fossil fuels.

    Therefore, two bottlenecks are looming—more power is trying to squeeze into an inadequate grid and coal-fired plants are being retired faster than new plants using renewable energy sources such as wind and solar are being built to replace them.

    “The United States is heading for a reliability crisis,” Federal Energy Regulatory Commission (FERC) Commissioner Mark Christie warned on May 4 in a hearing before the Senate Energy & Natural Resources Committee.

    “I do not use the term ‘crisis’ for melodrama, but because it is an accurate description of what we are facing,” Christie said. “I think anyone would regard an increasing threat of system-wide, extensive power outages as a crisis.”

    Committee chair Sen. Joe Manchin (D-W.V.) and ranking Republican Sen. John Barrasso (R-Wyo.) agreed, with both identifying the same culprit in an “impending, but avoidable, reliability crisis” that confronts the nation’s electricity grid.

    The “premature fossil retirements” amid increasing demand for power are a result of President Joe Biden’s green energy initiatives in 2021’s Bipartisan Infrastructure Law (BIL) and 2022’s Inflation Reduction Act (IRA) that incentivize investments in renewable energy.

    The incentives have proven effective in inducing investor interest—maybe too successful with projects being proposed and approved sooner than expected and faster than the grid’s transmission capacity is expanding.

    The Biden administration is “trying to force a dramatic increase in electrical demand” through the BIL and IRA, Manchin said, which will foster disruptions in transmission as old plants are retired and new ones come online.

    “We do have to address climate change but this transition is happening too fast,” he said, noting he and House Republicans have filed bills that address transmission. “I hope we can sit down and negotiate in good faith and put politics aside.”

    Natural Gas Shunted Aside

    Barrasso blasted the Biden administration for contributing to the pending energy transmission bottleneck by discouraging natural gas pipeline development, citing an April U.S. Energy Information Agency (EIA) report that documented the least amount of pipeline was built in 2022 than any time since such record-keeping began in 1995.

    Without restoring “balance” in the nation’s energy equation that includes coal, natural gas, and oil, “energy prices will skyrocket, grid reliability will degrade, and families all across the country will suffer,” Barrasso said.

    Christie was one of the four FERC commissioners to address the Senate committee during a hearing on the agency’s $520 million fiscal year 2024 budget request, but few questions posed by senators during the session directly addressed the proposed spending plan.

    Under the Federal Power Act, Natural Gas Act, and Interstate Commerce Act, among other legislative and administrative actions, FERC is responsible for managing the nation’s electrical grid.

    More than 5,200 megawatts (MW) of oil, coal, and nuclear power plant energy generation were “retired” between 2013 and 2022, and another 5,000 MW of coal- and oil-fired generation could be retiring in coming years, according to the U.S. Energy Information Agency (EIA).

    Coal-fired plants that generate more than 200,568 MW of energy plan to shut down by 2029 because of “continued competition from natural gas and renewable resources” and higher operating costs associated with older, less efficient coal-fired generators, the EIA reported in November 2022.

    It said an average of 9,450 MW of coal-fired electricity was retired annually between 2012 and 2021. U.S. coal-fired plant retirements totaled 11,778 MW of capacity in 2022. That trend is expected to continue at least through 2029 when, the EIA projects, 23 percent of the remaining 200,568 GW of coal-fired energy will go offline.

    Michigan, Texas, Indiana, and Tennessee will see the most “coal-fired capacity retirements” through 2029, accounting for a combined 42 percent of energy generation in those four states that will need to be replaced.

    Natural gas is also leaving the grid faster than it is being replaced. In November, FERC anticipated 107 units of “high-probability” natural gas units totaling 17,062 MW capacity would go online by September 2025. Over that same time span, however, 130 units totaling 17,489 MW of natural gas power will go offline.

    By September 2025, FERC anticipates that the amount of electricity produced by renewable energies will grow from about a quarter of the nation’s power generation to one-third of “available, installed generating capacity.”

    Utility-scale solar and wind generating capacity would expand from 17.37 percent of domestic capacity to 23.24 percent by September 2025, with solar and wind accounting for 11.23 percent and 12.01 percent, respectively, according to FERC.

    While the sharp increase in FERC’s three-year forecast for wind and solar, coupled with coal-fired plant retirements and the “apparent peaking of natural gas” as a source of electrical generation applauded by renewable energy proponents, even those who support the shift to renewables are raising alarm about the timing of a transition that is happening faster than government capacity to plan and regulate.

    A coal-fired power plant in Adamsville, Ala., in April 2021. (ANDREW CABALLERO-REYNOLDS/AFP via Getty Images)

    FERC $520 Million Budget Not On Agenda

    Much of the hearing focused on interim FERC Chair Willie Phillips, named by Biden in January to succeed Richard Glick, a Democrat criticized by Senate Republicans and Manchin for imposing new guidelines on natural gas projects and incorporating pipeline emissions in permitting reviews.

    Machin addressed the pile-on of new greenhouse gas regulations imposed by the Biden administration as “simply staggering” during the May 4 hearing.

    Biden originally nominated Glick for another term but in November Manchin said he was “uncomfortable” with the renomination and would not hold a required confirmation hearing before his committee. 

    Machin endorsed Phillips as chair in a Jan. 3 statement that called him “a supremely qualified and reasonable person” who “understands the need to balance affordability and reliability.”

    Barrasso said he also backs Phillips’s confirmation as FERC chair, praising him for “resetting the agenda to bring forward discussions for action” with an “emphasis on energy availability and affordability.”

    While he doesn’t always agree with him, Barrasso told Phillips, “Under your leadership, the commission has made great progress since you took over just a couple of months ago.”

    Phillips, who was District of Columbia Public Service Commission Chair from 2018 to 2021, has served as a FERC commissioner since December 2021.

    A regulatory attorney, he has been criticized by Public Citizen and other consumer groups as too accommodating to utilities, primarily from his stint as counsel for the North American Electric Reliability Corp, a public-private entity that assists FERC in grid development.

    With Phillips serving as chair, the five-seat FERC commission is down one member and evenly split between Democrats and Republicans. A fifth commission nominee has not been put forward by the administration.

    Phillips and Allison Clements are the commission’s two Democrats with Christie and James Danly as its two Republicans. All addressed the Senate panel on May 4.

    The Electric Power Supply Association and Interstate Natural Gas Association of America are among industry groups raising fears that the 2–2 deadlock can delay projects, including the transmission of zero-emissions electricity into the utility grid, efforts to bolster climate-weather resiliency, and the warding off of cyber-attacks. 

    Acting FERC Chairman Willie Phillips. (Public Service Commission of the District of Columbia Annual Report 2016)

    New Chair, New FERC Priorities

    Phillips said one of the first things he did as FERC chair was clearly reiterate the agency’s reason for existing.

    “It is our responsibility to ensure that rates for the wholesale sale and transmission of electricity, as well as the transportation of oil and natural gas by pipeline, in interstate commerce are just and reasonable,” he said in his testimony.

    FERC is also responsible for permitting and regulating energy infrastructure—plants and transmission lines—and that includes “interstate natural gas pipelines” and “facilities for exporting or importing Liquified Natural Gas.”

    Phillips said that after clarifying FERC’s mission, he sent forth three priorities: reliability, electric transmission, and environmental justice. 

    “I am happy to report that, in a few short months, we have made substantial progress on all three fronts,” he told the panel.

    Reliability “is—and always must be—job number one” for the commission when the nation faces “unprecedented challenges to the grid’s reliability,” Phillips said. 

    “Foreign and domestic actors are testing our cyber defenses every day. Physical threats to the grid are on the rise. And extreme weather of all kinds is threatening power to customers across the country,” he said.

    Among the steps in addressing cyber security is the January finalization of a rule that requires the North American Electric Reliability Corporation (NERC) to develop “enhanced cybersecurity standards,” Phillips said.

    NERC, a not-for-profit public-private regulatory entity provides FERC with reliability and security assessments of grid integration from Canada to northern Mexico. 

    In February, Phillips said, the FERC Commission updated and enhanced winter preparedness measures recommended by NERC “designed to help prevent a repeat of the grid impacts we saw” in 2021 winter storms, especially in Texas.

    The commission in March approved new reliability standards to “further protect our electric system supply chain from hostile actors,” he said, adding in April it “issued yet another final rule,” this time implementing the requirement in [BIL] to establish incentives to induce cybersecurity investments.

    “These actions represent the ‘blocking and tackling’ that is absolutely necessary to ensure that our electric grid remains secure, reliable, and resilient,” Phillips said.

    FERC’s second priority under his leadership is transmission, he said.

    Transmission “is, in itself, a reliability imperative,” Phillips said, calling transmission “the key that can unlock the potential of so many of the energy security measures” in the BIL and IRA.

    Phillips said FERC has several “rule-making” priorities it wants to implement in the coming year to enhance transmission.

    “First, my highest priority in the near term is to finalize a proposed rule that will greatly improve our processes for interconnecting new electric generating resources, reducing the time it takes to bring those resources online,” he said.

    “In addition,” Phillips added, “we are working to finalize a second proposed rule on how to plan and pay for badly needed regional electric transmission facilities.”

    A third proposed transmission-related rule would provide the FERC commission with the “backstop siting authority” accorded it under the BIL.

    Philips said his third priority as FERC chair is environmental justice. 

    “For me, this is personal,” he told the Senate panel, recalling growing up in “an environmental justice community in Alabama” where he experienced “firsthand what it means for a community to bear more than its fair share of pollution and the other costs of industrial development.”

    He balanced that experience with recognizing “the benefits that investment can provide to historically underserved communities” in the form of jobs, tax revenues, and the community benefits of economic development.

    “Having seen both sides, it is my goal as chairman to do all that we reasonably can to ensure that environmental justice communities affected by the commission’s decisions do not bear too great a share of the burdens or too small a share of the benefits that new energy infrastructure can provide,” Phillips said.

    Tyler Durden
    Sun, 05/07/2023 – 13:30

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