Oil or Bread

Congress Has Big Questions for Big Oil

WASHINGTON (AP) - Big Oil is once again being called on the carpet. Senior executives of the five largest U.S. oil companies were to appear before a congressional committee Tuesday where they were likely to find frustrated lawmakers in no mood for small talk.
"These companies are defending billions of federal subsidies ... while reaping over a hundred billion dollars in profits in just the last year alone," complained Rep. Edward Markey, D-Mass., in previewing the hearing.
The lawmakers were scheduled to hear from top executives of Exxon Mobil Corp. (XOM), Shell Oil Co., BP America Inc., Chevron Corp. (CVX) and ConocoPhillips, which together earned about $123 billion last year because of soaring oil and gasoline prices.
Markey, chairman of the Select Committee on Energy Independence and Global Warming, said he wants to know why, with such profits, the oil industry is steadfastly fighting to keep $18 billion in tax breaks, stretched over 10 years.
The House last year and again on Feb. 27 approved legislation that would have ended the tax breaks for the oil giants, while using the revenue to support wind, solar and other renewable fuels and incentives for energy conservation. The measure has not passed the Senate.
The oil industry has argued on Capitol Hill and at the White House that the tax breaks are needed to assure continued investment in exploration, production and refinery expansions. President Bush has promised to veto any such bill, saying that the oil companies should not be singled out.
The threat of nationwide $4-a-gallon gasoline, perhaps this summer, and $100-a-barrel oil is producing strong political reverberations, even as lawmakers acknowledged there is little that Congress can do to bring prices down.
On Monday, Rep. Neil Abercrombie, D-Hawaii, said that the president should release oil from the government's emergency reserve to put more supplies on the market, saying, "We are quite clearly in the midst of an energy emergency." He noted the bankruptcy of Aloha Airlines, blamed in part on high jet-fuel costs.
The White House has repeatedly rejected use of the oil in the federal Strategic Petroleum Reserve to influence prices.
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USA 2008: The Great Depression
Food stamps are the symbol of poverty in the US. In the era of the credit crunch, a record 28 million Americans are now relying on them to survive – a sure sign the world's richest country faces economic cris

Food stamps are a continuing reminder of widespread poverty


By David Usborne in New YorkTuesday, 1 April 2008
We knew things were bad on Wall Street, but on Main Street it may be worse. Startling official statistics show that as a new economic recession stalks the United States, a record number of Americans will shortly be depending on food stamps just to feed themselves and their familiesDismal projections by the Congressional Budget Office in Washington suggest that in the fiscal year starting in October, 28 million people in the US will be using government food stamps to buy essential groceries, the highest level since the food assistance programme was introduced in the 1960s.
The increase – from 26.5 million in 2007 – is due partly to recent efforts to increase public awareness of the programme and also a switch from paper coupons to electronic debit cards. But above all it is the pressures being exerted on ordinary Americans by an economy that is suddenly beset by troubles. Housing foreclosures, accelerating jobs losses and fast-rising prices all add to the squeeze.
Emblematic of the downturn until now has been the parades of houses seized in foreclosure all across the country, and myriad families separated from their homes. But now the crisis is starting to hit the country in its gut. Getting food on the table is a challenge many Americans are finding harder to meet. As a barometer of the country's economic health, food stamp usage may not be perfect, but can certainly tell a story.
Michigan has been in its own mini-recession for years as its collapsing industrial base, particularly in the car industry, has cast more and more out of work. Now, one in eight residents of the state is on food stamps, double the level in 2000. "We have seen a dramatic increase in recent years, but we have also seen it climbing more in recent months," Maureen Sorbet, a spokeswoman for Michigan's programme, said. "It's been increasing steadily. Without the programme, some families and kids would be going without."
But the trend is not restricted to the rust-belt regions. Forty states are reporting increases in applications for the stamps, actually electronic cards that are filled automatically once a month by the government and are swiped by shoppers at the till, in the 12 months from December 2006. At least six states, including Florida, Arizona and Maryland, have had a 10 per cent increase in the past year.
In Rhode Island, the segment of the population on food stamps has risen by 18 per cent in two years. The food programme started 40 years ago when hunger was still a daily fact of life for many Americans. The recent switch from paper coupons to the plastic card system has helped remove some of the stigma associated with the food stamp programme. The card can be swiped as easily as a bank debit card. To qualify for the cards, Americans do not have to be exactly on the breadline. The programme is available to people whose earnings are just above the official poverty line. For Hubert Liepnieks, the card is a lifeline he could never afford to lose. Just out of prison, he sleeps in overnight shelters in Manhattan and uses the card at a Morgan Williams supermarket on East 23rd Street. Yesterday, he and his fiancée, Christine Schultz, who is in a wheelchair, shared one banana and a cup of coffee bought with the 82 cents left on it.
"They should be refilling it in the next three or four days," Liepnieks says. At times, he admits, he and friends bargain with owners of the smaller grocery shops to trade the value of their cards for cash, although it is illegal. "It can be done. I get $7 back on $10."
Richard Enright, the manager at this Morgan Williams, says the numbers of customers on food stamps has been steady but he expects that to rise soon. "In this location, it's still mostly old people and people who have retired from city jobs on stamps," he says. Food stamp money was designed to supplement what people could buy rather than covering all the costs of a family's groceries. But the problem now, Mr Enright says, is that soaring prices are squeezing the value of the benefits.
"Last St Patrick's Day, we were selling Irish soda bread for $1.99. This year it was $2.99. Prices are just spiralling up, because of the cost of gas trucking the food into the city and because of commodity prices. People complain, but I tell them it's not my fault everything is more expensive."
The US Department of Agriculture says the cost of feeding a low-income family of four has risen 6 per cent in 12 months. "The amount of food stamps per household hasn't gone up with the food costs," says Dayna Ballantyne, who runs a food bank in Des Moines, Iowa. "Our clients are finding they aren't able to purchase food like they used to."
And the next monthly job numbers, to be released this Friday, are likely to show 50,000 more jobs were lost nationwide in March, and the unemployment rate is up to perhaps 5 per cent.
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Elizabeth Edwards highlights (one of) the flaws in McCain’s healthcare plan

Maybe it’s just me, but I tend to think this observation might resonate with voters: John McCain could be denied coverage under John McCain’s healthcare plan. It’s a point Elizabeth Edwards drove home very well over the weekend.
Elizabeth Edwards, the wife of former Democratic presidential contender John Edwards, said she and John McCain have one thing in common: “Neither one of us would be covered by his health policy.”
Edwards lodged her criticism of the presumptive Republican presidential nominee’s proposal Saturday at the annual meeting of the Assn. of Health Care Journalists.
Under McCain’s plan, insurance companies “wouldn’t have to cover preexisting conditions like melanoma and breast cancer,” she said.
McCain has been treated for melanoma, the most serious type of skin malignancy. Edwards in 2004 was diagnosed with breast cancer, and announced a year ago that it had returned and spread into her bones, meaning it no longer could be cured.
McCain’s plan focuses on offering new tax breaks for individuals who buy their own health insurance. But critics say the Arizona senator’s proposal avoids giving insurers requirements on whom they must cover and how much they may charge.
At the risk of sounding picky, “critics say” McCain’s plan avoids requirements for insurance companies because McCain’s plan avoids requirements for insurance companies. It’s an objective fact, not a point of contention.
Indeed, it points to an ideological problem underpinning the debate.