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Today's announcement that Joseph Kelliher, chairman of the powerful
Federal Energy Regulatory Commission (FERC) and a commissioner since
2003, is stepping down provides President-elect Barack Obama with an
opportunity to fix an agency with a history of promoting deregulation
and power company profits at the expense of fair energy prices to
American families. Under Kelliher's watch, FERC continued the failed
policy of deregulation, resulting in consumers paying billions of
dollars more in home energy costs than if markets under FERC control
had been properly regulated.
Kelliher, who served as the Energy Department's liaison to Vice
President Dick Cheney's infamously corporate-biased Energy Task Force
prior to becoming FERC commissioner, consistently overlooked the
agency's top statutory mandate: to ensure that all electric rates be
"just and reasonable."As a result, Kelliher's FERC has undergone
ongoing criticism by states and consumer groups for its backward
At a time when officials such as former Fed chairman Alan Greenspan
have concluded that federal deregulation efforts went too far and
resulted in abuses, Kelliher continued to claim that the policy of
electricity deregulation - pioneered by Enron - has been a success. In
this, he is the last man standing, nearly alone in his obstinate
insistence that deregulation worked.
A Public Citizen analysis
in October shows that, in states where electricity is deregulated and
wholesale markets are under FERC jurisdiction, households pay prices 50
percent higher than in those states that remain fully regulated. FERC's
failure to regulate the electric rates that power plant owners,
investment banks and others that buy and sell electricity contracts
charge allows these sellers ample opportunities to manipulate markets
and price-gouge consumers. As a result, adequate competition does not
exist in America's electricity markets. Many states stopped
deregulation or reregulated because of these problems.
Public Citizen urges President-elect Obama to appoint a chairman
with consumer advocacy experience who will pledge to end the disastrous
deregulation experiment, marking a return to well-regulated markets
where all electric rates are "just and reasonable."
The importance of having a consumer-focused FERC chair not only will
ensure that consumers will be free from being price-gouged, but will
facilitate the implementation of successful climate change legislation.
Some approaches to lowering greenhouse gas emissions rely on
market-based approaches such as cap and trade, which requires
transparent, competitive wholesale electricity markets to send the
correct price signals to reduce carbon emissions. But FERC's continued
promotion of market concentration and stagnation would render any
market-based approach to climate change a failure before it starts.
Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.(202) 588-1000
"Free advice for the speaker of the House: if you want to cut spending so bad, start and end with the Pentagon budget," said one watchdog group.
With the U.S. just 10 days away from a possible default, House Republicans are now demanding a military budget even larger than the record $858 billion that Congress authorized for the current fiscal year as they continue pushing for steep cuts to key aid programs.
The GOP demand was reported over the weekend after Republican negotiators rejected a White House offer to "freeze" both military and non-military spending—an idea that congressional Republicans previously appeared open to—in exchange for a debt ceiling increase, causing talks to break down. The powerful defense industry, which donates heavily to Democrats and Republicans, howled in protest earlier this year at the prospect of military spending cuts.
Republicans are also, according toPolitico, "demanding work requirements for SNAP recipients that are more rigid than those they originally proposed" and "insisting on adding new immigration provisions from the GOP's recently passed border bill" while dismissing White House proposals to cut prescription drug spending and close tax loopholes exploited by the rich.
"Republicans in D.C. are pushing for a massive increase in the $858 billion Pentagon budget, a $1.8 trillion tax break to people who inherit over $1 billion, and a $3.5 trillion extension of Trump's tax breaks," Sen. Bernie Sanders (I-Vt.), who is urging President Joe Biden to act unilaterally to end the debt ceiling standoff, wrote over the weekend. "Oh, did they tell you how very, very concerned they are about the deficit?"
Higher military spending would mean that, in order for Republicans to achieve their stated spending-reduction goals, non-military spending would have to be slashed even more aggressively. The Center on Budget and Policy Priorities has estimated that cuts to other federal programs—from housing to childcare to medical research—"would be enormous" if military spending and veterans' healthcare were spared: "33% in 2024 rising to an eye-popping 59% cut in 2033."
The fresh GOP push for an even more bloated Pentagon budget came as a new "60 Minutes" investigation examined how private military contractors—a major lobbying force in Washington with nearly 800 registered influence-peddlers—price gouge the Defense Department with impunity, fueling the agency's annual spending growth.
"The gouging that takes place is unconscionable. It's unconscionable," Shay Assad, a former top contract negotiator at the Pentagon who previously worked at Raytheon—making him a so-called "reverse revolver"—told the program.
"No matter who they are, no matter what company it is, they need to be held accountable. And right now that accountability system is broken in the Department of Defense," said Assad. "If you're happy with companies gouging you and just looking you right in the eye and say, 'I'm gonna keep gouging you because I know you don't have the guts to do anything about it,' then I guess we should just keep doing what we're doing."
\u201c\u201cThe gouging that takes place is unconscionable. It's unconscionable.\u201d \n\nShay Assad, a former Defense Department contract negotiator, said the Pentagon overpays for almost everything \u2013 from missiles and planes to spare parts.\u201d— 60 Minutes (@60 Minutes) 1684710554
"This is what Rep. Barbara Lee and I have been talking about," Rep. Mark Pocan (D-Wis.), co-chair of the Defense Spending Reduction Caucus, tweeted in response to the "60 Minutes" probe. "We need to #AuditThePentagon."
A Pentagon-backed study released last month found, unsurprisingly, that "publicly traded U.S.-based corporations in the defense industrial base are, in aggregate, financially healthy."
"They are profitable," the study continued. "They generate substantial amounts of cash beyond their needs for operations or capital investment; the bulk is returned to shareholders so they can invest it elsewhere. They generate total returns to shareholders well in excess of what one might expect given their relative low risk to investors. Bankruptcies or other signs of financial distress are exceptionally rare. Strong financial performance was maintained even during periods of market turmoil."
Stephen Semler, co-founder of the Security Policy Reform Institute, has estimated that more than half of all Pentagon spending between fiscal years 2002 and 2021 went to private contractors that provide the government with military equipment.
"Free advice for the speaker of the House: if you want to cut spending so bad, start and end with the Pentagon budget," the progressive advocacy group Public Citizensaid on Saturday. "Don't touch SNAP or Social Security or Medicare and Medicaid."
"MAGA House Republicans are threatening a default that could cost us millions of jobs and trigger a recession," said the president. "All because they are demanding deep cuts that will hurt hardworking families—even while they protect tax breaks for the wealthy and corporations."
Before a meeting with U.S. House Speaker Kevin McCarthy planned for Monday, President Joe Biden on Sunday renewed his criticism of what GOP lawmakers are demanding in exchange for raising the debt ceiling to prevent an economically catastrophic default.
"I've done my part," Biden told reporters—pointing to his trillions of dollars in proposed spending cuts and new sources of revenue—before heading back to Washington, D.C. from Hiroshima, Japan, where he attended a three-day Group of Seven summit.
"Now it's time for the other side to move... from their extreme positions, because much of what they've already proposed is simply, quite frankly, unacceptable," Biden said of McCarthy (R-Calif.) and the other House Republicans holding the economy hostage.
\u201cMAGA House Republicans are threatening a default that could cost us millions of jobs and trigger a recession.\n\u00a0\nAll because they are demanding deep cuts that will hurt hardworking families \u2013 even while they protect tax breaks for the wealthy and corporations.\n\nI\u2019ve got a plan to\u2026\u201d— President Biden (@President Biden) 1684685203
The president continued:
Let me be clear: I'm not going to agree to a deal that protects, for example, a $30 billion tax break for the oil industry, which made $200 billion last year—they don't need an incentive of another $30 billion—while putting healthcare of 21 million Americans at risk by going after Medicaid.
I’m not going to agree to a deal that protects $200 billion in excess payments for pharmaceutical industries and refusing to count that while cutting over 100,000 schoolteachers and assistants' jobs, 30,000 law enforcement officers' jobs cut across the entire United States of America.
And I'm not going to agree to a deal that protects wealthy tax cheats and crypto traders while putting food assistance at risk for... nearly 1 million Americans.
"It's time for Republicans to accept that there is no bipartisan deal to be made solely... on their partisan terms," Biden added, while also declaring that "America has never defaulted... on our debt, and it never will."
However, Treasury Secretary Janet Yellen has warned that if Congress doesn't raise the debt limit soon, the federal government could run out of money to pay its bills by June 1. Growing fears of a default have prompted some legal scholars and progressive lawmakers to pressure Biden to stop negotiating with GOP hostage-takers and invoke the 14th Amendment to the U.S. Constitution, which says in part that "the validity of the public debt... shall not be questioned."
Among them is Sen. Bernie Sanders (I-Vt.), who wrote in a Sunday email to supporters: "In a manner that is unprecedented and incredibly reckless and cruel, these Republicans have hijacked the debt ceiling process. Their position: If the Congress does not agree to impose savage cuts on the needs of working people, the elderly, the children, the sick, and the poor, they will push the U.S. government to default on its debt. In other words, they are prepared to wreck our economy if they don't get their way."
"In my view, President Biden has the authority and the responsibility under the 14th Amendment of the Constitution to make sure that we continue to pay our bills. The language in that amendment is quite clear," Sanders said, urging anyone who agrees to sign a petition "calling on President Biden to exercise that authority in order to protect the country from the savage Republican budget."
In response to a reporter's question Sunday, Biden said that "I'm looking at the 14th Amendment, as to whether or not we have the authority. I think we have the authority. The question is: Could it be done and invoked in time that it... would not be appealed and, as a consequence, pass the date in question, and still default on the debt? That's a question that I think is unresolved."
The American Prospect executive editor David Dayen suggested in a pair of tweets that rather than inquiring if Biden will invoke the 14th Amendment, journalists should be asking how he plans to respond to an existing lawsuit that involves it.
\u201cA good question from the Gang of 500, instead of "will you invoke the 14th amendment" (which is not how it works) is "you've been served, how will you respond?"\u201d— David Dayen (@David Dayen) 1684678216
Earlier this month, lawyers for the National Association of Government Employees (NAGE)—which represents roughly 75,000 workers across federal agenices—filed a suit against Biden and Yellen in the U.S. District Court for the District of Massachusetts.
NAGE, which has endorsed Biden for reelection in 2024, aims to have the debt ceiling law declared unconstitutional, and on Friday—after Dayen publicly pointed out lack of progress with the case—the union's legal team requested emergency action by the court.
Meanwhile, Politicoreported Friday that some Biden aides fear invoking the 14th Amendment "would trigger a pitched legal battle, undermine global faith in U.S. creditworthiness, and damage the economy," and "officials have warned that even the appearance of more seriously considering the 14th Amendment could blow up talks that are already quite delicate."
After departing Japan on Sunday, Biden spoke with McCarthy by phone from Air Force One. Following the call, the GOP speaker confirmed plans to meet with the president on Monday but also said that "my position has not changed."
Sanders, in his email Sunday, wrote that "Republicans' willingness to hold the world's economy hostage to their draconian and cruel demands, and their refusal to consider one penny in new revenue from the wealthy and large corporations, has made it seemingly impossible to enact a bipartisan budget deal at this time."
"The debt ceiling is about paying money that has already been appropriated and spent. It has nothing to do with future budgets and future spending," he stressed. "And throughout the history of our country, the U.S. government has always done what it is supposed to do—we pay our debts."
"We can return to the path of progress. We can realize our ambitions for health and well-being for all," said António Guterres. "But only if the world works together... despite the tensions straining relations between nations."
"Progress is in peril."
That was United Nations Secretary-General António Guterres' warning Sunday to the 76th World Health Assembly.
Over seven decades ago, he noted, "countries came together and affirmed some fundamental truths: that peace depends on health; that disease in one nation endangers all; and that achieving the greatest possible health for everyone, everywhere relies on cooperation."
Since the creation of the World Health Organization (WHO), Guterres continued, "human health has advanced dramatically: global life expectancy—up over 50%; infant mortality—down 60% in 30 years; smallpox—eradicated; and polio on the verge of extinction."
But now, "war and conflict threaten millions. The health of billions is endangered by the climate crisis. And the Covid-19 pandemic has stalled, and even reversed, progress in public health," the U.N. leader said in a video address kicking off the assembly.
"We can return to the path of progress. We can realize our ambitions for health and well-being for all. But only if the world works together. If we cooperate, despite the tensions straining relations between nations," he stressed.
\u201cSmallpox \u2013 eradicated.\n\nPolio - on the verge of extinction.\n\nInfant mortality \u2013 down 60% in 30 years.\n\nHuman health has advanced dramatically since the birth of the @WHO, but now progress is in peril.\n\nWe can return to the path of progress but only if the world works together.\u201d— Ant\u00f3nio Guterres (@Ant\u00f3nio Guterres) 1684699200
Guterres called for "strengthening the independence, authority, and financing of the World Health Organization," and said that "it is vital to prepare for the health threats to come—from new pandemics to climate dangers—so that we prevent where we can, and respond fast and effectively where we cannot."
WHO Director-General Tedros Adhanom Ghebreyesus—who earlier this month declared Covid-19 over as a global health emergency—similarly urged international coordination during his welcome speech to the assembly. The agency leader said that "in 2020, I described Covid-19 as a long, dark tunnel. We have now come out the end of that tunnel."
"To be clear, Covid-19 is still with us, it still kills, it's still changing, and it still demands our attention," Tedros continued. The end of the emergency "is not just the end of a bad dream from which we have woken. We cannot simply carry on as we did before."
"This is a moment to look behind us and remember the darkness of the tunnel, and then to look forward, and to move forward in the light of the many painful lessons it has taught us. Chief among those lessons is that we can only face shared threats with a shared response," Tedros added. He stressed that the pandemic accord now being negotiated "must be a historic agreement to make a paradigm shift in global health security, recognizing that our fates are interwoven."
\u201cLIVE: Opening of the 76th World Health Assembly with @DrTedros. #WHA76 https://t.co/RwqX5YGr98\u201d— World Health Organization (WHO) (@World Health Organization (WHO)) 1684673003
As the assembly—scheduled through May 30—got underway in Geneva, Switzerland, Guterres was in Hiroshima, Japan, for the Group of Seven (G7) summit, where he also underscored the importance of global cooperation while speaking to the press on Sunday.
"My message to G7 leaders is clear: While the economic picture is uncertain everywhere, rich countries cannot ignore the fact that more than half the world—the vast majority of countries—are suffering through a deep financial crisis," Guterres said. "The crushing economic impact of the Covid-19 pandemic, the climate crisis, Russia's invasion of Ukraine, unsustainable levels of debt, rising interest rates, and inflation are devastating developing and emerging economies."
"There is a systemic and unjust bias in global economic and financial frameworks in favor of rich countries," he declared, highlighting that "access to Covid-19 vaccines was deeply unfair" and "the recovery has been extremely unbalanced."
While the U.N. chief argued that "it's time to reform both the Security Council and the Bretton Woods institutions," referring to the International Monetary Fund and World Bank, he also said that "even within the present unfair global rules, more can and must be done to support developing economies."
G7 countries are "central to climate action," Guterres said, noting the need for "faster timelines to phase out fossil fuels and ramp up renewables," an end to dirty energy subsidies, and financial support for developing nations that are disproportionately bearing the brunt of a crisis largely created by the Global North.
As Common Dreamsreported earlier Sunday, since G7 leaders on Saturday put out a communiqué addressing a wide range of topics, campaigners around the world have decried the statement's support for further investments in planet-heating gas, calling it "a blunt denial of the climate emergency."