Archive for August, 2011

h1

Jon Huntsman’s New Jobs Plan is Big on Energy

August 31, 2011

The centerpiece to Huntsman’s policy proposal is his massive overhaul of the tax system, eliminating most tax breaks (including some extremely popular ones) in exchange for drastically lower rates of  8%, 14% and 23% (plus a drop of the corporate rate to 25% and a scheme to repatriate foreign earnings).  As James Pethokoukis notes, this plan “looks like perhaps the most pro-growth, pro-market (and anti-crony capitalist) tax plan put forward by a major U.S. president candidate since Ronald Reagan in 1980.”

Although tax policy is the aspect that will garner the most attention, Huntsman also focuses on liberating America’s vast untapped energy sources, including shale oil (and, as former governor of Utah, he probably has more detailed knowledge about the pros, cons and roadblocks of that potential resource than anyone in the field).

Personally, I think you have to pass a carbon tax to go along with this in order to narrow the significant political opposition it will face.  A carbon tax that includes tradeable tax credits for various activities that reduce CO2 would be both a political and financial boon for fossil energy advocates, IMO.

Disclosure:   I have contributed financially to Huntsman’s campaign and he is my first choice for the GOP nomination, even though I am not a registered member of the party.  Yes, I am the guy who gets him to 1% in the polls.   (FWIW, my second choice, is Gary Johnson, showing you just how far out of the Republican mainstream I reside)

h1

China welcomes new Japan Prime Minister with belligerence

August 31, 2011

Yoshihiko Noda was elected president of Japan’s ruling Democratic Party of Japan (DPJ), thus becoming the third DPJ leader to become Japan’s Prime Minister since taking power in 2009.  While the DPJ came to power questioning the long time alliance with the United States and seeking to warm relations with China, both of those positions have subsequently softened and both previous DPJ PMs moved closer to the US.  Read this excellent summary of recent Japanese politics and foreign policies from this month’s Foreign Affairs for background.

Noda seems to be the most pro-American of the three DPJ leaders.  Although reconstruction from the Great Japanese Earthquake and Tsunami, as well as dealing with the crippled Fukushima reactors, will dominated Noda’s agenda, he will not be able to long escape attending to Japan’s role in the growing competition between China and Japan for Asia/Pacific hegemony.  China is already beginning to apply pressure.  As Elizabeth Economy at the Council on Foreign Relations’ Asia Unbound blog writes:

While Premier Wen Jiabao and the Chinese Foreign Ministry have offered up short congratulatory statements to the new prime minister, most Chinese commentary has ranged from bleak to belligerent. Chinese analysts point out that the prime minister has not renounced his comments to the effect that Class-A Japanese wartime leaders should no longer be considered criminals nor has he committed not to visit the Yasukuni Shrine. He also has made reference to China’s rising nationalism and naval activities as posing a risk to regional stability. To top it all off, the new prime minister has been a strong supporter of the U.S.-Japan defense alliance.

Economy also notes several “suggestions” that the Chinese have for Prime Minister Noda that read like a list of demands from a master to a vassal.   Japan is an indispensible linchpin of the US alliance system.  EGP hopes that the US offers Noda a genuine attitude of partnership to counterpoint China’s immediate attitude of high handedness.

h1

Bing West sums up the Afghanistan campaign

August 31, 2011

Another must-read from West at Foreign Affairs:

Regardless of how the war turns out, the military lessons learned will be negative; the conflict has dragged on far too long to be considered a strategic success. Unlike in the years after World War II, the generals of this day will not gain in historical stature. The popularity of the idea of counterinsurgency as nation building reached its zenith when Iraq was stabilized in 2008. At the time, the U.S. military’s counterinsurgency warriorintellectuals were in vogue. As happened to their predecessors after the Vietnam War, however, their concepts of war fighting will come to be rejected by the younger generation of company-grade officers who had to execute a flawed doctrine. No matter their skills and good intentions, foreign troops cannot persuade the people of another nation to reject insurgents in their midst. The people must convince themselves — and be willing to sacrifice for that conviction.

As always, read the whole thing.

h1

Peugeot’s diesel/electric hybrid crossover will get 73+ MPG

August 31, 2011

Peugeot’sHX1 diesel-hybrid crossover concept car will be unveiled at the Frankfurt Auto Show.

Via Gas2.0:

The HX1 delivers an estimated 73.5 mpg (U.S.) while offering seating for six adults. It’s plug-in hybrid drivetrain is mated to a 204 horsepower turbo-diesel engine to power the front wheels, while two electric motors drive the rear wheels. Aside from the fancy hybrid tech, a low drag coefficient of just 0.28 also contributes to the slippery look and feel of the HX1.

 

h1

Russia/Belarus/Kazakstan “common economic space”

August 31, 2011

Walter Russell Mead tells us that this nascent reformulation of the core of the former Soviet Union is not a matter for undue concern, but we disagree.  There is reason for cautious alarm.  First of all, this is another indication that the coalitioning period of the current Long Cycle phase is apace (with the consequent macrodecision looming), and such indications always have to be noted with concern.  Also, Putin is (arguably) influenced by Eurasianist theorists whose goal is a unified continental system on a Berlin/Moscow/Beijing axis.  Russian Eurasianists, of course, see this system naturally dominated by Russia, but certainly the Germans and Chinese would have other ideas.  That the system might be unwieldy and ultimately collapse does not change the fact that a Heartland unification is the Mackinderian fear that has obsessed Anglo-American geopolitical theorists for over a century.  Eurasianism is a direct challenge to the Atlanticism that has defined the contours of the World System for half a millenium.  While some would argue that the last 500 years have been an aberration and a shift to a Eurasia-centric system is a return to normalcy, the parochial interests of the West in general and of the United States in particular demand that we seek to extend that aberrational period as long as possible.

h1

CSTO to build Rapid Reaction Force

August 31, 2011

The Russia-dominated Collective Security Treaty Organization held an informal summit earlier this month, in which the heads of the various states agreed to create a “rapid reaction” military force that could intervene in member nations should the need arise.  This probably signals Moscow’s intentions to prop up member governments and to ensure that no unfriendly regime takes root in the former Soviet Space.

h1

Natural gas liquids drive fracking boom

August 30, 2011

Valerie Wood at Seeking Alpha explains why drillers keep seeking natural gas despite the price collapse below $4 per MMBtu.   The answer is that fracking produces not just natural gas, but natural gas liquids (NGLs):

As crude oil prices have risen, the value of NGLs in the natural gas production process has increased accordingly. As a result, producers are not responding to falling prices by curtailing production the way they have historically. Instead, producers are idling rigs in gas basins with lower NGLs and focusing primarily on shale plays that are liquid-rich, i.e.those that contain a higher percentage of NGLs. Many of these liquid-rich shale plays still contain a substantial amount of natural gas.

Hat tip to Harry Slack (@naturalgaswv), whose tweet tipped me to this article.