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Letter from the Motor City
Ross Perlin, openDemocracy
Detroit once represented the growth, bustle and prosperity of the United States. As the US auto industry sinks, the city now epitomises darker times. Ross Perlin explores the ruins
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... Detroit is probably America's best-known example of a shrinking city, and it's still in free fall. This is one reason why the city has little to show for its large-scale, officially-sanctioned renewal plans. The city's bright spots are small-scale, experimental efforts. Immigration - particularly from Africa and the middle east (the city of Dearborn is by now the acknowledged center of Arab America) - is one hope of the revivalists. Bringing back manufacturing - electric car startups, green job schemes, and high-speed rail plants have all been mentioned - is another. To boost local businesses, a new, homegrown currency, the Detroit Cheers, was recently launched.

Mostly in their 20s and 30s, Detroit's several hundred urban farmers, linked by the Detroit Agriculture Network, have their own answer to the shrinking city. Many sell their produce at Eastern Market, one of America's largest and oldest public markets, currently being restored to greatness shed by shed. Some farmers are growing vegetables along Woodward Avenue, the city's main drag, which runs from the riverfront to the suburbs. Others establish community gardens the size of postage stamps wherever they can.

On the depressed east side, Tyree Guyton and other artists have transformed a section of derelict Heidelberg Street into an vast outdoor art project. Dozens of discarded stuffed animals hang from the sides of a boarded-up house. Regiments of defunct vacuum cleaners, waving gloves from their handles, mark out an overgrown garden. Shopping carts defy gravity on an exposed treetop.
(19 June 2009)

Pay, Baby, Pay
Bob Gramling and Bill Freudenburg, Miller-McCune
Before the U.S. responds to 'drill, baby, drill' campaign rhetoric with more offshore energy exploration, it should revise Reagan-era leasing and royalty rules that cost the Treasury billions.
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... In the 25 years after Watt's program was introduced, area-wide leasing has greatly reduced what oil companies pay for the right to drill offshore — and, correspondingly, greatly cut the per-acre income the government earns through its leasing program. In effect, area-wide leasing was a huge subsidy for major oil companies. How huge? Our research shows that per-acre lease rates plunged from an average of $2,224.71 for all federal leases identified as being sold from 1954 through 1982 to an average of $263.33 for the leases sold since Watt's area-wide leasing went into effect.

But there's more. The other main revenue stream the federal government receives from offshore oil and gas production — royalties — has also declined as a result of policy changes that began in the Watt era. In this case, though, Congress later expanded Watt's policy changes — even though the U.S. has always required a lower rate than most offshore producing countries.

Before Watt, offshore leases specified that the federal government receive one-sixth of the value of offshore resources extracted (16.66 percent). In contrast, the state of Alaska — where oil extraction is scarcely cheap or easy — receives 22.5 percent on state leases. When area-wide leasing started in 1983, a number of leases were sold with royalties on one-eighth of the resource value, or 12.5 percent. These lower rates were generally for leases with greater water depths; they were offered in an attempt to encourage exploration in deeper areas of the Gulf of Mexico. Even though these rates were barely half of those being charged in Alaska, Congress decided in 1995 to provide "relief" to the oil companies, passing the Outer Continental Shelf Deep Water Royalty Relief Act, which allowed the companies to produce millions of barrels of oil and billions of cubic feet of gas without paying a nickel's worth of royalties.
(17 June 2009)

Robert F. Kennedy challenged our Ponzi scheme pursuit of growth for growth's sake, much as his heir, Barack Obama, does
Joe Romm, WorldChanging
Robert F. Kennedy challenged our Ponzi scheme pursuit of growth for growth's sake, much as his heir, Barack Obama, does
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Robert F. Kennedy was assassinated 41 years ago last week. He challenged our monomaniacal pursuit of GDP in "one of the most beautiful of his speeches,” as Obama described it an August 2008 NYT profile of his economic thinking.

Obama is one of the few major politicians who constantly challenges our unsustainable economic worldview today (see "Obama gets the Ponzi scheme"). Let's listen to RFK's remarkable words and then Obama's:

[YouTube clip]

Here is the transcript:

We will find neither national purpose nor personal satisfaction in a mere continuation of economic progress, in an endless amassing of worldly goods. We cannot measure national spirit by the Dow Jones Average, nor national achievement by the Gross National Product. For the Gross National Product includes air pollution, and ambulances to clear our highways from carnage. It counts special locks for our doors and jails for the people who break them. The Gross National Product includes the destruction of the redwoods and the death of Lake Superior. It grows with the production of napalm and missiles and nuclear warheads... It includes.. the broadcasting of television programs which glorify violence to sell goods to our children.

And if the Gross National Product includes all this, there is much that it does not comprehend. It does not allow for the health of our families, the quality of their education, or the joy of their play. ...

... After praising RFK's speech, Obama goes on to discuss sustainability with the NYT reporter:

The second point Obama wanted to make was about sustainability. The current concerns about the state of the planet, he said, required something of a paradigm shift for economics. If we don’t make serious changes soon, probably in the next 10 or 15 years, we may find that it’s too late.

(18 June 2009)

Can the U.S. Afford to Let California Fail?
Kevin O'Leary, Time
States across the nation are suffering the effects of lost tax revenue in the worst economic downturn since the Great Depression. California's woes are similar and different in kind, played out on a grand scale in a state that boasts the world's eighth largest economy and a Hollywood star in the lead role...

..."California could become the only state in the First World without subsistence benefits for poor children," says Frank Mecca, executive director of the County Welfare Directors Association of California...

...A nightmare scenario: the Federal Government backs California's loans, which leads to a downgrading of the Treasury's credit rating and the unnerving of the global credit markets. Spooked, the Chinese government, which currently bankrolls a large portion of the U.S. deficit, decides to take its money elsewhere. The ripples from California's crisis would then extend far beyond the Sandovals and other families on the wrong end of the budget ax.
(18 June 2008)