Category Archives: Wealth Redistribution

The Chinese Communist Party’s Capitalist Elite

businessweek.com | Mar 1, 2012

By Michael Forsythe

Here’s yet another metric in which China has blown past the U.S.: The richest 70 members of China’s legislature added more to their wealth last year than the combined net worth of all 535 members of the U.S. Congress, the president, his cabinet, and the entire Supreme Court. These wealthy Chinese are members of the National People’s Congress, the nation’s lawmaking body that opens its annual session on March 5.

The collective net worth of these 70 lawmakers rose to 565.8 billion yuan ($89.8 billion) in 2011, a gain of $11.5 billion from 2010, according to figures from the Hurun Report, a Shanghai publisher of luxury magazines that ranks the country’s wealthy. That compares to the $7.5 billion net worth of all 660 top officials in the three branches of the U.S. government, data from Washington’s Center for Responsive Politics show.

In China per capita annual income in 2010 was $2,425, less than in Belarus and a fraction of the $37,527 in the U.S. The disparity between rich and poor in China underscores one of the biggest challenges China’s leadership faces—a rise in social unrest fueled by illegal land grabs and corruption. “It is extraordinary to see this degree of a marriage of wealth and politics,” says Kenneth Lieberthal, director of the John L. Thornton China Center at Washington’s Brookings Institution. “It certainly lends vivid texture to the widespread complaints in China about an extreme inequality of wealth.”

Members of the National People’s Congress, often derided as a rubber-stamp parliament, are among China’s most powerful politicians and executives, wielding power in their home provinces and shaping national tax policy. Zong Qinghou, chairman of beverage-maker Hangzhou Wahaha Group and China’s second-richest person, with a family fortune of 68 billion yuan, is a member. So is Wu Yajun, chairwoman of Beijing-based Longfor Properties. She has family wealth of 42 billion yuan and is the richest woman in China, according to the Hurun Report, which uses publicly available information such as corporate filings to compile its annual rich list.

The third-richest person in the NPC, auto-parts magnate Lu Guanqiu, traveled with Vice President Xi Jinping—the presumed successor to President Hu Jintao—to the U.S. during his official visit in February. Zong, Wu, and Lu declined to comment for this story.

Chinese private executives such as Zong and Lu have built their fortunes on the back of economic growth that has averaged 10.1 percent in the last 30 years. (The U.S. economy expanded by an average annual rate of 2.7 percent in the same period.) Many of the NPC’s richest members are executives in real estate, a sector where property ownership disputes have prompted demonstrations and contributed to the rising wealth gap between city dwellers and farmers. A land claim by a property developer in Wukan, a fishing town in southern China’s Guangdong province, sparked protests in December that resulted in the expulsion of its Communist Party leaders.

Rupert Hoogewerf, chairman and chief researcher for the Hurun Report, estimates that for every billionaire the company discovers for its list there is another one it misses. “The prevalence of billionaires in the NPC shows the cozy relationship between the wealthy and the Communist Party,” says Bruce Jacobs, a professor of Asian languages and studies at Monash University in Melbourne, Australia. “In all levels of the system there seem to be local officials in cahoots with entrepreneurs, enriching themselves.”

The bottom line: China’s richest 70 lawmakers saw their collective net worth jump to nearly $90 billion in 2011. China’s 2010 per capita income: $2,425.

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More than 1 in 5 Americans are economically insecure

CNNMoney | Nov 28, 2011

By Tami Luhby

NEW YORK (CNNMoney) — More than one in five Americans saw at least a quarter of their available household income vanish each year during the Great Recession, and they lacked a sufficient financial cushion, according to a report released Monday.

The situation has left them economically insecure, according to the report, which updates an Economic Security Index created by Jacob Hacker, a political science professor at Yale.

More than 20% of the nation faced this condition in each of the three years spanning 2008 to 2010, a sharp increase from 14.3% in 1986. Some 62 million Americans faced economic insecurity last year.

Many of the people who suffered in the economic downturn are in the middle class.

“The middle class is facing much more instability and health care [cost] risk than a generation ago,” Hacker said.

The Great Recession is also prompting deep losses among the insecure, with the median drop in income for this group hitting a record 46.4% in 2009.

Hacker, who launched the Economic Security Index with a team of researchers last year, looks at three measures to determine insecurity: major income loss, out-of-pocket medical expenses and the lack of savings. He considers available income to be money left over after paying health care costs and debts.

Based primarily on Census data, the index measures annual income changes.

Faces of poverty

The index is yet another indicator of the toll the Great Recession has taken Americans’ financial well-being. The economic downturn prompted the poverty rate to soar to 15.1% in 2010, the highest level since 1993. And the median household income fell to $49,445 last year, when adjusted for inflation, a level not seen since 1996.

Meanwhile, roughly 13.9 million Americans remained unemployed, 42% of whom had been out of work for 27 weeks or longer.

While economic insecurity increased across the board, Hacker’s index found some groups suffered more than others during the downturn. Those living in the West and the South were more on the edge than those in the Northeast and North Central part of the country.

Young adults, age 18 to 34, proved to be the most insecure group during the recession, with a rate of nearly 25%. The next most vulnerable folks were those age 45 to 64, with a rate of just under 20%.

Nearly a quarter of African-Americans and Hispanics faced economic insecurity. By comparison, fewer than one in five whites were in the same boat.

The lack of an education also made a major difference, with 25.8% of Americans in households headed by someone who never graduated high school experiencing a major economic setback, compared to 15.8% of someone with post-college education.

Health care costs have contributed mightily to economic insecurity. The median household spent about 36% more for medical expenses than its counterpart in 1986.

Economic insecurity had been rising even prior to the Great Recession, Hacker found. Between 1986 and 1996, the average share of Americans facing insecurity was 16%. In the following decade, it rose to 17.6%.

Going forward, Hacker expects the figures to decrease unless the nation experiences another spike in unemployment, since that’s a primary driver of income loss. However, he estimates it will take six years for the typical person to return to their previous security level.

“Recovery from a downturn like this will be much slower for the individual and for the country as a whole,” he said.

Poorest poor in US hits new record: 1 in 15 people


In a Thursday, Sept. 16, 2010 file photo, a man who did not wish to be identified, who lost his job two months ago after being hurt on the job, works to collect money for his family on a Miami .

About 20.5 million Americans, or 6.7 percent of the U.S. population, make up the poorest poor, defined as those at 50 percent or less of the official poverty level. Those living in deep poverty represent nearly half of the 46.2 million people scraping by below the poverty line. In 2010, the poorest poor meant an income of $5,570 or less for an individual and $11,157 for a family of four.

Associated Press | Nov 4, 2011

By HOPE YEN and LAURA WIDES-MUNOZ

WASHINGTON (AP) — The ranks of America’s poorest poor have climbed to a record high — 1 in 15 people — spread widely across metropolitan areas as the housing bust pushed many inner-city poor into suburbs and other outlying places and shriveled jobs and income.

New census data paint a stark portrait of the nation’s haves and have-nots at a time when unemployment remains persistently high. It comes a week before the government releases first-ever economic data that will show more Hispanics, elderly and working-age poor have fallen into poverty.

In all, the numbers underscore the breadth and scope by which the downturn has reached further into mainstream America.

“There now really is no unaffected group, except maybe the very top income earners,” said Robert Moffitt, a professor of economics at Johns Hopkins University. “Recessions are supposed to be temporary, and when it’s over, everything returns to where it was before. But the worry now is that the downturn — which will end eventually — will have long-lasting effects on families who lose jobs, become worse off and can’t recover.”

Traditional inner-city black ghettos are thinning out and changing, drawing in impoverished Hispanics who have low-wage jobs or are unemployed. Neighborhoods with poverty rates of at least 40 percent are stretching over broader areas, increasing in suburbs at twice the rate of cities.

Once-booming Sun Belt metro areas are now seeing some of the biggest jumps in concentrated poverty.

Signs of a growing divide between rich and poor can be seen in places such as the upscale Miami suburb of Miami Shores, where nannies gather with their charges at a playground nestled between the township’s sprawling golf course and soccer fields. The locale is a far cry from where many of them live.

One is Mariana Gripaldi, 36, an Argentinian who came to the U.S. about 10 years ago to escape her own country’s economic crisis. She and her husband rent a two-bedroom apartment near Biscayne Bay in a middle-class neighborhood at the north end of Miami Beach, far from the chic hotels and stores.

But Gripaldi said in the past two years, the neighborhood has seen an increase in crime.

“The police come sometimes once or twice a night,” she said in Spanish. “We are looking for a new place, but it’s so expensive. My husband went to look at a place, and it was $1,500 for a two-bedroom, one bath. I don’t like the changes, but I don’t know if we can move.”

About 20.5 million Americans, or 6.7 percent of the U.S. population, make up the poorest poor, defined as those at 50 percent or less of the official poverty level. Those living in deep poverty represent nearly half of the 46.2 million people scraping by below the poverty line. In 2010, the poorest poor meant an income of $5,570 or less for an individual and $11,157 for a family of four.

That 6.7 percent share is the highest in the 35 years that the Census Bureau has maintained such records, surpassing previous highs in 2009 and 1993 of just over 6 percent.

Broken down by states, 40 states and the District of Columbia had increases in the poorest poor since 2007, and none saw decreases. The District of Columbia ranked highest at 10.7 percent, followed by Mississippi and New Mexico. Nevada had the biggest jump, rising from 4.6 percent to 7 percent.

Concentrated poverty also spread wider.

After declining during the 1990s economic boom, the proportion of poor people in large metropolitan areas who lived in high-poverty neighborhoods jumped from 11.2 percent in 2000 to 15.1 percent last year, according to a Brookings Institution analysis released Thursday. Such geographically concentrated poverty in the U.S. is now at the highest since 1990, following a decade of high unemployment and rising energy costs.

Extreme poverty today continues to be prevalent in the industrial Midwest, including Detroit, Grand Rapids, Mich., and Akron, Ohio, due to a renewed decline in manufacturing. But the biggest growth in high-poverty areas is occurring in newer Sun Belt metro areas such as Las Vegas, Riverside, Calif., and Cape Coral, Fla., after the plummeting housing market wiped out home values and dried up construction jobs.

As a whole, the number of poor in the suburbs who lived in high-poverty neighborhoods rose by 41 percent since 2000, more than double the growth of such city neighborhoods.

Elizabeth Kneebone, a senior research associate at Brookings, described a demographic shift in people living in high-poverty neighborhoods, which have less access to good schools, hospitals and government services. As concentrated poverty spreads to new areas, including suburbs, the residents are now more likely to be white, native-born and high school or college graduates — not the conventional image of high-school dropouts or single mothers in inner-city ghettos.

The more recent broader migration of the U.S. population, including working- and middle-class blacks, to the South and to suburbs helps explain some of the shifts in poverty.

A study by the Joint Center for Political and Economic Studies found that the population of 133 historically black ghettos had dropped 36 percent since 1970, as the U.S. black population growth slowed and many blacks moved to new areas. The newest residents in these ghettos are now more likely to be Hispanic, who have more than tripled their share in the neighborhoods, to 21 percent.

Just over 7 percent of all African-Americans nationwide now live in traditional ghettos, down from 33 percent in 1970.

“As extreme-poverty neighborhoods emerge in more places, that is shifting the general makeup of those populations,” said Kneebone, the lead author of the Brookings analysis.

New 2010 poverty data to be released next week by the Census Bureau will show additional demographic changes.

The new supplemental poverty measure for the first time will take into account non-cash aid such as tax credits and food stamps, but also additional everyday costs such as commuting and medical care. Official poverty figures released in September only take into account income before tax deductions.

Based on newly released estimates for 2009, the new measure will show a significant jump in overall poverty. Poverty for Americans 65 and older is on track to nearly double after factoring in rising out-of-pocket medical expenses, from 9 percent to over 15 percent. Poverty increases are also anticipated for the working-age population because of commuting and child-care costs, while child poverty will dip partly due to the positive effect of food stamps.

For the first time, the share of Hispanics living in poverty is expected to surpass that of African-Americans based on the new measure, reflecting in part the lower participation of immigrants and non-English speakers in government aid programs such as housing and food stamps. The 2009 census estimates show 27.6 percent of all Hispanics living in poverty, compared with 23.4 percent for blacks.

Alba Alvarez, 52, a nanny who chatted recently in Miami, said she is lucky because her employer rents an apartment to her and her husband at a low rate in a comfortable neighborhood on the bay. But her adult children, who followed her to the U.S. from Honduras, are having a tougher time.

They initially found work in a regional wholesale fruit and vegetable market that supplies many local supermarkets. But her youngest son recently lost his job, and since he has no legal status, he cannot get any help from the government.

“As a mother, I feel so horrible. There’s this sense of powerlessness. I wanted things to be better for them in this country,” Alvarez said. “I (recently) suggested my youngest go back to Honduras. It’s easier for me to help him there than here, where rent and everything is so expensive.”

Higher prices boost Big Oil profits as production slows


This May 5, 2011 file photo shows gasoline prices of $5.09 USD displayed at an Exxon station in Washington, DC. ExxonMobil, the world’s largest energy company, on October 27, 2011 posted a 41 percent profit jump for the second consecutive quarter as sales soared. Net earnings rose to $10.33 billion, or $2.13 per share, in the July-September period, the company said. Sales increased 31.5 percent from a year ago to $125.33 billion, outstripping analyst forecasts of $113.56 billion. AFP PHOTO/Karen BLEIER (Photo credit should read KAREN BLEIER/AFP/Getty Images)

Associated Press | Oct 29, 2011

By CHRIS KAHN

Higher oil prices have masked a slowdown in production among the biggest oil companies.

Exxon Mobil, Royal Dutch Shell and BP reported a surge in quarterly profits this week even though they’re producing less oil from fields around the world, including a combined 7 percent decline in the third quarter that just ended. Each company has devoted billions of dollars to finding new petroleum deposits, but it could be years, even decades, before those investments translate to more oil and natural gas.

Experts say smaller companies will need to step up to satisfy growing world demand. China, India and other developing nations are expected to push the global appetite for oil to a record 90 million barrels per day next year, enough to outstrip supplies.

Three years ago, a severe drop in oil supplies helped push oil prices to above $147 per barrel, saddling airlines and shipping companies with high fuel costs. Gasoline prices soared above a national average $4 per gallon.

“We’re not at the point where oil prices are going to go bananas” and spike like they did in 2008, said Ken Medlock, an energy expert at Rice University. “But if we saw production declines like this for five or six years, then it’s time to worry.”

Big Oil’s third-quarter financial results highlight a growing problem within the industry. New petroleum sources are increasingly tough — and expensive — to find. The best new deposits are found more than a mile under the ocean, or in vast layers of sticky Canadian sand, or in the frigid Arctic.

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Oil Industry Hums as Higher Prices Bolster Quarterly Profits at Exxon and Shell

Costs have increased dramatically as the industry digs deeper.

A decade ago, tapping a new well used to cost about $10 to $20 for every barrel of oil produced. Now it’s estimated at about $50 or $60 for wells in the Gulf of Mexico and $70 or $80 in the Canadian oil sands.

To boost production, oil companies not only must find new sources of oil, they need to make up for production losses at aging fields. Exxon’s fields, for example, are declining by 5 to 7 percent each year, Oppenheimer & Co. analyst Fadel Gheit said.

“They need to add 200,000 to 300,000 barrels a day of production just to break even,” Gheit said. “That’s huge.”

Overall, analysts think oil producers can still increase supplies in coming years, thanks to smaller companies and increased contributions from OPEC. But it may not be enough to keep up with demand.

Morgan Stanley analyst Hussein Allidina expects supplies to rise by about 1 percent to 2 percent every year until 2016. That assumes “flawless execution,” Allidina said in a research note. Even if that happens, demand will grow 1.5 percent every year over the same period.

It raises the possibility of price spikes. A surge in oil not only means higher fuel prices, it also poses problems for the industry. The record jump in oil prices in 2008 may have led to record profits for Exxon that year, but it weakened the economy so much that prices eventually plunged. That sapped profits in later quarters and forced the industry to table many projects.

Smaller companies are expected to ramp up in fields that are too tiny for Big Oil. For example, Occidental Petroleum said it has increased oil production about 4 percent so far this year. Saudi Arabia and a handful of other OPEC members have the ability to put more oil on the market, if needed. And Libya is expected to start exporting oil again later this year following an eight-month rebellion.

Exxon Mobil on Thursday said profits jumped 41 percent in the third quarter to $10.33 billion, or $2.13 per share, as higher oil and natural gas prices made up for lower production. Profits doubled for Shell and BP for the same reason. Chevron, the second-largest U.S. oil company, is expected to report its financial results on Friday.

Exxon sold oil in the U.S. for an average of $95.58 a barrel, up 35.2 percent from a year earlier. Internationally, it charged $107.32 a barrel, up 45.4 percent. It also charged more for natural gas.

The higher prices propped up earnings at Exxon’s exploration and production business, which finds and pumps oil and natural gas.

Exxon’s U.S. refineries also benefited. Their profits quadrupled as demand for gasoline and other fuels soared around the world, enabling them to charge more.

Exxon shares rose 81 cents, or 1 percent, to $81.88. BP shares climbed 78 cents to $45.43.

Oil prices also jumped 4 percent to end the day at $93.96 per barrel in New York.

9/11 gave rise to new sacred cash cow: Homeland Security

“The number of people worldwide who are killed by Muslim-type terrorists, al-Qaida wannabes, is maybe a few hundred outside of war zones. It’s basically the same number of people who die drowning in the bathtub each year.” 

Los Angeles Times | Aug 27, 2011

By KIM MURPHY

On the edge of the Nebraska sand hills is Lake McConaughy, a 22-mile-long reservoir that in summer becomes a magnet for Winnebagos, fishermen and kite sailors. But officials here in Keith County, population 8,370, have long imagined a different scenario: an al-Qaida sleeper cell hitching explosives onto a water skiing boat and plowing into the dam at the head of the lake.

The federal Department of Homeland Security a few years ago gave the county $42,000 to buy state-of-the-art dive gear, including full-face masks, underwater lights and radios, and a Zodiac boat with side-scan sonar capable of mapping wide areas of the lake floor. Cherry County, Neb., population 6,148, got thousands of federal dollars for cattle nose leads, halters and electric prods in case terrorists decided to mount biological warfare against cows.

In the Los Angeles suburb of Glendale, where police fear militants might be eyeing DreamWorks Animation or the Disney creative campus, a $205,000 Homeland Security grant bought a 9-ton BearCat armored vehicle, complete with turret. More than 300 BearCats – many acquired with federal money – are now deployed by police across the country; the arrests of meth dealers and bank robbers these days often look much like a tactical assault on insurgents in Baghdad.

A decade after the Sept. 11 attacks on the World Trade Center and the Pentagon, federal and state governments are spending about $75 billion a year on domestic security, setting up sophisticated radio networks, upgrading emergency medical response equipment, installing surveillance cameras and bomb-proof walls and outfitting airport screeners to detect an ever-evolving list of mobile explosives.

But whether the 10-year spending spree has been worth it is the subject of increasing debate. Dozens of potential attacks likely have been disrupted because of hyper-vigilant police and an untold number of others deterred by measures like airport screening. Homeland security spending has acted as a primer-pump for local governments starved by the recession and dramatically improved emergency response networks across the country. Yet a number of critics suggest that the same billions spent on cancer research or safer cars would have saved more lives.

“The number of people worldwide who are killed by Muslim-type terrorists, al-Qaida wannabes, is maybe a few hundred outside of war zones. It’s basically the same number of people who die drowning in the bathtub each year,” said John Mueller, an Ohio State University professor who has written extensively about the balance between threat and expenditures in fighting terrorism.

“So if your chance of being killed by a terrorist in the United States is one in 3.5 million, the question is, how much do you want to spend to get that down to one in 4.5 million?” he said.

An entire industry has sprung up to sell a vast array of products, including high-tech motion sensors and fully outfitted emergency operations trailers. The market is expected to grow to $31 billion by 2014.

And grow it will: The Department of Homeland Security, a collection of agencies ranging from border control to airport security sewn quickly together after Sept. 11, is the third-largest Cabinet department and – with almost no lawmaker willing to render America less prepared for a terrorist attack – one of those least likely to fall victim to budget cuts. Like the military industrial complex that became a permanent and powerful part of the American landscape during the Cold War, the vast network of homeland security spyware, concrete barricades and high-tech identity screening is likely here to stay.

But for what? The expensive and time-consuming screening that passengers have come to see as routine at airport boarding gates has detected plenty of knives, loaded guns and other contraband, but it has never identified a terrorist who was about to board a plane. Only 14 Americans have died in about three dozen instances of Islamic extremist terrorist plots targeted at the U.S. outside war zones since 2001 – most of them involving one or two home-grown plotters.

That may be because the system worked. DHS officials say there is no way to compute how many lives might have been lost had the nation’s massive security apparatus not been put into place, had the bombers not been arrested before they struck. Who knows how many terrorists didn’t try to get on a plane because they figured it would be too hard?

“We know that they study our security measures, we know they’re continuously looking for ways to get around them, and that’s a disincentive for someone to carry out an attack,” said John Cohen, the department’s deputy counterterrorism coordinator.

“Another way of asking the question is, has there been a U.S. airplane that has exploded?”

State and local emergency responders have undergone a dramatic transformation with the aid of $32 billion that has been dispensed in Homeland Security grants since 2002, much of it in the early years spent on Hollywood-style tactical gear, often with little connection between risk and outlay.

“After 9/11, it was literally like my mother running out the door with the charge card,” said Al Berndt, assistant director of the Emergency Management Agency in Nebraska, which has received $163.7 million in federal anti-terrorism and emergency aid grants. “What we really needed to be doing is saying, ‘Let’s identify the threat, identify the capability and capacity you already have, and say, OK, what’s the shortfall now, and how do we meet it?’ ”

The spending has been rife with dubious expenditures, including the $557,400 in rescue and communications gear that went to the 1,500 residents of North Pole, Alaska, and a $750,000 anti-terrorism fence – fashioned with 8-foot-high ram-proof wrought iron reinforced with concrete footers – built around a Veterans Affairs hospital in the pastoral hills outside Asheville, N.C.

West Virginia got $3,000 worth of lapel pins and billed the federal government for thousands of dollars in cellphone charges, according to the Center for Investigative Reporting, which compiled a state-by-state accounting of DHS spending. In New York, $3 million was spent on automated public health records to help identify bioterrorism threats, but investigators for the DHS Inspector General in 2008 found that employees who used the program weren’t even aware of its potential bioterrorism applications.

In some cases, hundreds of millions went down the rat hole, such as when Homeland Secretary Janet Napolitano earlier this year pulled the plug on the Secure Border Initiative, a Boeing Co. contract that was to set up an ambitious network of surveillance cameras, radar and sensors as a 2,000-mile-long “virtual” border across the U.S.-Mexico frontier. Originally intended to be in place by 2009, the endeavor was plagued with cost overruns and missed deadlines and wound up costing $1 billion before it was canceled.

Vast sums of homeland security money, critics complain, have been propelled by pork-barrel politics into the back yards of the congressionally connected, yet the spending has also acted as a cash-rich economic stimulus program for many states at a time when other industries are foundering.

Utah is getting a $1.5 billion National Security Agency cyber-security center that will generate up to 10,000 jobs in the state. In Nebraska, which likes to point out that former President George W. Bush flew here for shelter after the 9/11 attacks, the Pentagon in July launched bidding for a $500 million U.S. Stratcom headquarters at Offutt Air Force Base.

Officials in Nebraska have insisted that no one is immune. A virus dropped at a cattle feed lot could wipe out a big part of the nation’s food supply, they point out, while an attack on the dam at Lake McConaughy would cut off the main Interstate highway linking New York and San Francisco and the biggest rail switching yard in the country.

“It would take out Kearney, Grand Island, the power grid, stuff like that. It could definitely do a lot of damage in what I call homeland America, and that’s where these guys want to hit,” said Ralph Moul, chief of the nearby Keystone-Lemoyne fire department.

Nor is terrorism here just a theoretical fear – Nebraska was one of several states in the Midwest hit by pipe bombs planted by a Minnesota youth in 2002. In 2007, a shooting rampage at an Omaha shopping mall left nine people dead, including the shooter, and four wounded.

Officials here say Nebraska and other places in Middle America not necessarily in al-Qaida’s gunsights have been able to improve traditional emergency response agencies that in many cases were under-equipped and poorly trained – a benefit of DHS grants that have required the money to be spent on responses to all kinds of emergencies, not just terrorist attacks.

“I think it’s important to understand the homeland security equipment wasn’t bought to be tucked away for the day there would be some terrorism event,” said Harold Peterson, Keith County’s emergency management director in Ogallala.

The Lake McConaughy dive team is so well equipped it has been called out on several drownings around the state. A radio network built with DHS funding paid off during widespread grass fires earlier this year by allowing departments from around the state to communicate easily with each other on their own radios. And when a massive tornado struck Joplin, Mo., in May, the city was able to get its phones running with the aid of an emergency communications trailer bought with some of the region’s $3.1 million in DHS grants.

Glendale, likewise, has not left the BearCat in the garage. Last fall, police rolled it out for a pre-dawn assault on an apartment in Echo Park, where a suspected armed robber and others were thought to be hiding. Instead of having to pound on the door – risking officers’ safety – they were able to park on the lawn and call for surrender on loud speakers.

“The neighbors may remember it, but the bottom line is, the neighborhood didn’t get shot up in a police action, dangerous suspects were taken into custody without incident, and we ensured the safety of those suspects and the officers involved,” department spokesman Tom Lorenz said.

Berndt, the emergency official in Nebraska, said he has kept detailed records of every dollar spent and is convinced the state is safer for it.

“For me to sit here and say all this money was spent wisely is for me to sit here and lie to you,” he said. “Could we have done better? Yes. Have we done all that bad? Probably not all that bad, in the overall scheme of things.”

Expensive massages, top shelf vodka and five-star hotels: First Lady Michelle Obama accused of spending $10m in public money on her vacations


High security: Numerous bodyguards surround the First Lady and youngest daughter Sasha as they take a stroll on the Costa del Sol

Daily Mail | Aug 25, 2011

The Obamas’ summer break on Martha’s Vineyard has already been branded a PR disaster after the couple arrived four hours apart on separate government jets.

But according to new reports, this is the least of their extravagances.

White House sources today claimed that the First Lady has spent $10million of U.S. taxpayers’ money on vacations alone in the past year.

Branding her ‘disgusting’ and ‘a vacation junkie’, they say the 47-year-old mother-of-two has been indulging in five-star hotels, where she splashes out on expensive massages and alcohol.

The ‘top source’ told the National Enquirer: ‘It’s disgusting. Michelle is taking advantage of her privileged position while the most hardworking Americans can barely afford a week or two off work.

‘When it’s all added up, she’s spent more than $10million in taxpayers’ money on her vacations.’

The First Lady is believed to have taken 42 days of holiday in the past year, including a $375,000 break in Spain and a four-day ski trip to Vail, Colorado, where she spent $2,000 a night on a suite at the Sebastian hotel.

And the first family’s nine-day stay in Martha’s Vineyard is also proving costly, with rental of the Blue Heron Farm property alone costing an estimated $50,000 a week.

The source continued: ‘Michelle also enjoys drinking expensive booze during her trips. She favours martinis with top-shelf vodka and has a taste for rich sparking wines.

‘The vacations are totally Michelle’s idea. She’s like a junkie. She can’t schedule enough getaways, and she lives from one to the next – all the while sticking it to hardworking Americans.’

While the President and his wife do pay for some of their personal expenses from their own pocket, the website whitehousedossier.com says that the amount paid by the couple is ‘dwarfed by the overall cost to the public’.

The magazine also reported that Mrs Obama, whose fashion choices are widely followed, had been going on ‘wild shopping sprees’, much to the distress of her husband, who, its sources reveal, is ‘absolutely furious’ at his wife’s ‘out-of-control spending’.

The President has already come under fire this week over his decision to take a family vacation while millions of Americans are out of work and countless more are financially strapped.

But the situation sparked further anger after he and his wife elected to fly separately to the Massachusetts retreat – despite travelling on the same day.

Mr Obama left the White House aboard Marine One on his way to Andrews Air Force base to hitch a lift aboard Air Force One – along with First Dog Bo.

After landing at Cape Cod Coast Guard Air Station, he then took a final helicopter to his holiday destination to complete the remarkable 500-mile journey.

His wife and daughters, who arrived just four hours earlier, were also travelling from Washington, but took a specially designed military aircraft.

They would also have had their own motorcade from the airport to the vacation residence.

Full story

Britain’s wealthiest aristocrats cashing in on “Green” energy subsidies


Growing numbers of the nobility are being tempted to build giant wind farms on their estates by the promise of tens of millions of pounds being offered green energy developers.

The aristocrats cashing in on Britain’s wind farm subsidies

Telegraph | Aug 22, 2011

By Robert Mendick and Edward Malnick

They are among the nation’s wealthiest aristocrats, whose families have protected the British landscape for centuries. Until now that is.

For increasing numbers of the nobility – among them dukes and even a cousin of the Queen – are being tempted by tens of millions of pounds offered by developers to build giant wind farms on their estates.

An investigation by The Sunday Telegraph reveals how generous subsidies – that are added to consumer energy bills – are encouraging hereditary landowners to build turbines up to 410ft tall on their land.

With controversy over onshore wind farms growing, the role of the landed establishment in fuelling the ‘scramble for wind’ will alarm opponents.

They claim wind farms are blighting the countryside while failing to deliver a reliable supply of electricity despite the cost.

Latest figures show the amount of electricity generated by UK wind farms actually fell last year because of the lowest average wind speeds this century.

However, supporters say a network of wind farms will guarantee Britain cheap, sustainable energy in the future.

The turbines being hosted by the landed gentry are almost always many miles from the aristocrats’ own homes. The Duke of Gloucester, who lives in an apartment in Kensington Palace in London, is hoping to build a wind farm 85 miles away on his ancestral estate in Northamptonshire, which he moved out of in 1994. Each turbine could earn the Duke, who is the Queen’s cousin, up to £20,000 a year and possibly much more.

It comes as Sir Reginald Sheffield, David Cameron’s father-in-law, whose baronetcy was created in the mid 18th century, admitted last week he earns as much as £350,000 a year from eight turbines on his estate at Bagmoor in Lincolnshire.

In a letter last week to the Spectator magazine, Sir Reginald protested that he did not own the turbines on Bagmoor farm and that his estate received only a “modest income” amounting to “less than one tenth” of £3.5 million.

Calculations by an energy think tank suggested Sir Reginald could be receiving about £120,000.

The Duke of Roxburghe has angered locals – including the neighbouring Duke of Northumberland – after winning a lengthy planning and legal battle to build 48 turbines, each about 400ft high, on unspoilt moorland in the Scottish borders.

Construction work began about two months ago with the building of a road 10 miles long through previously pristine countryside to reach the wind farm site.

The Duke, who is worth about £100 million, will reportedly earn as much as £2.5 million a year from the deal although a spokesman, who declined to discuss the actual amount, said that figure was not accurate.

One industry expert said a more realistic figure was in the order of £720,000 a year.

In the course of the 25-year lifespan of the wind farm at Fallago Rig that could net the Duke anywhere between £18 million and £62.5 million.

The details of the deal struck with an energy company remain confidential although The Sunday Telegraph understands the Duke’s earnings are performance related – in other words the more the wind blows the more money he will make.

One industry expert estimated Fallago Rig could generate about £875 million income over the next quarter of a century for the Duke and his commercial partner North British Windpower.

Half that sum is in the form of a consumer subsidy, introduced by the last Labour government to encourage renewable energy projects, and which is added on to household electricity bills.

The turbines will not be visible from Floors Castle, the Duke’s ancestral home about 25 miles away.

The Duke of Beaufort, who is worth £120 million, is trying to build 19 turbines on land near Swansea – about 100 miles from his family seat at Badminton House in Gloucestershire.

The turbines could generate around £285,000 for the Somerset Trust, which runs his estate. A spokesman last week insisted the Duke of Beaufort would not gain personally from the wind farm.

Meanwhile Earl Spencer, brother of Diana, Princess of Wales, is planning 13 turbines on his Althorp estate, each of which will be more than 410ft high.

The Earl of Seafield, who owns over 100,000 acres making him Britain’s seventh largest landowner, has eight turbines on his land in Banffshire generating rental income in the region of £120,000 while the Earl of Moray receives, according to one industry expert, in excess of half a million pounds a year from 36 turbines near Stirling in Scotland.

Jeremy Dearden, the Lord of the Manor of Rochdale, a title that once belonged to Lord Byron, was given permission earlier this year for five turbines to be built on Todmorden Moor in Lancashire. Mr Dearden, who lives in New Zealand where he has a farm, stands to earn in the region of £75,000.

A spokesman for Coronation Power, the energy company which rents Mr Dearden’s land, said: “When the wind farm enters operation, we will pay the landowner an annual land rental fee based on a percentage of total revenue generated by the wind farm. This figure is based on industry standard fees.”

Dr John Constable, director of the Renewable Energy Foundation, a think tank critical of the subsidies for onshore wind farms, and who calculated wind farm income for The Sunday Telegraph, said: “Many of these landowners must know, deep down, that the subsidies are a national scandal, but easy money on this scale would tempt a saint.”

Sir Simon Jenkins, chairman of the National Trust but speaking in a personal capacity, said: “The level of subsidy available to landowners to put up these turbines is out of all proportion to the public benefit derived from them and the temptation to ruin what is usually outstanding landscapes is overwhelming. It is a crime against the landscape.”

According to local opposition groups, the Duke of Gloucester made farmland close to Barnwell Manor, his former home in Northamptonshire, available to the highest bidder, entering into an agreement with West Coast Energy, a company based in north Wales.

West Coast Energy failed to return calls last week while Buckingham Palace, which handles media inquiries for the Duke, said it was a matter for West Coast Energy.

Peter Stephens, 74, a retired engineer fighting the development, said: “The Duke lives in Kensington Palace and doesn’t care if it’s spoiling our view. These turbines will be in the wrong place. This has been a completely unchanged vista since the 16th century and he wants to ruin it.”

John Elliot, Barnwell’s estate manager, rejected claims that the Duke is absent from the site. Mr Elliot said: “He turns up regularly to the estate. He is a very proactive landowner.”

The landowners point out that wind turbines not only help to reduce carbon emissions but also benefit the local community while helping to maintain expensive, centuries-old estates.

Sir Alastair Gordon-Cumming, a seventh baronet, who runs the Altyre estate near Inverness, who has been given planning consent for 29 turbines on his land, said the wind farm was the “most exciting thing to happen to the estate” for more than 70 years.

According to industry experts, the wind farm will generate income of about £18.5 million a year, half of it as subsidy. A spokeswoman for the Altyre estate refused to say how much money the estate would receive from the deal but industry experts estimate earnings of more than £400,000 a year, based on a going rate of £15,000 rental income per turbine.

The spokeswoman added: “This wind farm will be built on a huge swathe of hill land which is otherwise redundant, has no value, no income potential, and suddenly by being able to put a wind farm on it … that will enable him to sustain and maintain the estate for the benefit of the wider community.”