Friday, March 05, 2021


March 5th 2021 marks the 150th anniversary of Rosa Luxemburg's birth. A Polish-born Jewish revolutionary, she was one of the greatest theoretical minds of the European socialist movement. 

Aug. 19, 2020 — Rosa Luxemburg Internet Archive. “Freedom only for the supporters of the government, only for the members of one party – 

THAT REVOLUTIONARY FEMINIST JOURNAL; TEEN VOGUE
Mar. 5, 2020 — During her 47 years, Luxemburg was indefatigable in her commitment to building an international proletarian movement and encouraging ...
Rosa Luxemburg was a socialist revolutionary known for her critical perspective. Born in Poland, Luxemburg had become an important figure in the world ...
18 hours ago — Rosa Luxemburg, who was born on 5 March, 1871, was among the most important revolutionary Marxists of the 20th century, and her work ...
14 hours ago — One hundred and fifty years ago today, the Polish Marxist thinker and organizer Rosa Luxemburg was born. She is, without question, one of the ...

In marking the 100th anniversary of both the Revolution and Luxemburg's murder, the Rosa-Luxemburg-Stiftung seeks to commemorate her legacy, the legacy of ...

Rosa Luxemburg at 150: a revolutionary legacy





by James Plested
RED FLAG
SOCIALIST ALTERNATIVE AU
05 March 2021

Rosa Luxemburg, one of the great leaders in the history of the socialist movement, was born in Poland (then a province of the Russian empire) 150 years ago this month, on 5 March 1871. Luxemburg cut her teeth in the Polish revolutionary underground, but as an immensely talented political leader, she was drawn to the centre of the European workers’ movement in Germany, where, from the late 1890s, she became the driving force of the revolutionary wing of German socialism.

In the pamphlet Social Reform or Revolution?, the first part of which was published in 1899, she took up the fight against those in the German Social Democratic Party (SPD) who rejected revolution and argued instead for a focus on the gradual reform of capitalism through parliamentary and trade union work.

The leading figure within this “revisionist” current, as it came to be known, was Eduard Bernstein. In The Preconditions of Socialism and the Task of Social Democracy, he argued that, as capitalism developed, the tendency to economic crisis identified by Karl Marx was being overcome, raising the prospect of a permanent and peaceful advance towards universal prosperity.


What's the way to get to socialism?


In response to Bernstein, Luxemburg argued that, far from the contradictions in capitalism and its tendency to crisis being overcome, as the system developed, these contradictions would intensify. The period of growth and prosperity experienced in Germany in the last decades of the nineteenth century was only the calm before the storm. It wouldn’t be long, Luxemburg argued, before the contradictions inherent in the system broke out in the open again. Only this time, with the greater concentration of industry and the heightened competition between states for markets and resources, the crisis would be deeper and broader than ever before.

A little over a decade later, with the outbreak of World War One in 1914, the correctness of Luxemburg’s account was clearly demonstrated. The dream of universal capitalist prosperity was replaced overnight with the nightmare of industrial-scale slaughter in the trenches. Further, the behaviour of the SPD’s parliamentary leaders, who junked all their long-established anti-militarist
principles to vote in favour of funding the war effort, showed the truth of her insight that, rather than changing the system, the reformists would end up being changed by it.

“People who pronounce themselves in favour of the method of legislative reform in place of and in contradistinction to the conquest of political power and social revolution”, Luxemburg wrote, “do not really choose a more tranquil, calmer and slower road to the same goal, but a different goal”. In the face of a renewed crisis of capitalism, of war and brutality on an unprecedented scale, the reformists’ professions of faith in the long-term achievement of a socialist society gave way to a more or less straightforward defence of the existing order.

In her 1906 pamphlet, The Mass Strike, Luxemburg once again assailed the reformist currents of the SPD, this time contrasting their top-down, bureaucratic conception of the socialist movement with Marx’s idea of revolution as “the self-emancipation of the working class”.

The pamphlet was written in the aftermath of the first Russian Revolution of 1905. Events in Russia were greeted with a wave of enthusiasm in the Western European socialist movement. In particular, the central role played by mass strikes of workers in the revolution gave confidence to the radicals within the SPD and the trade unions. For the reformist SPD and trade union leaders, though, the new enthusiasm among workers for the mass strike was a cause for deep concern. It went against all the rules of the game—blurring the boundary between political demands, which they believed were the exclusive domain of the party, and economic demands, which were the responsibility of the unions, and risking the struggle moving beyond the carefully mapped paths of reform.

For many trade union leaders, parliamentarians and party officials, the development of union organisation and the advance of the SPD’s parliamentary activities had become ends in themselves. The attitude of many trade union leaders is summed up nicely in the words of Theodor Bömelburg, a building union leader, who said, “To develop our organisations further, we need peace in the labour movement”.
Read more

What coronavirus taught us about the ruling class


Strikes were a drain on union funds, and risked provoking the wrath of the capitalist state, which could impose punitive measures that would disrupt the unions’ operations. To the extent that a mass strike might be useful or necessary, it was a tactic to be employed carefully and precisely by the leaders, at the appropriate time and in the right conditions. We can see many of these same attitudes, and worse, in union leaders today.

In contrast to this, Luxemburg considered that the mass, unruly, revolutionary strikes that occurred in Russia in 1905 provided a reminder of where the true wellspring of the socialist movement was to be found. To her mind, the strength of the movement lay, not in the increasingly gigantic bureaucratic machinery of the unions or in the carefully thought-out manoeuvrings of the SPD’s parliamentary wing, but in the self-activity of workers in struggle.

For Luxemburg, the direct involvement of workers in struggle was the key to the advance of the workers’ movement, in both its economic and political dimensions. The relationship between the economic struggles of workers for better wages and conditions, and the struggle to advance the political goals of the workers’ movement, was highly reciprocal: “After every soaring wave of political action, there remains a fertile sediment from which sprout a thousand economic struggles. And the reverse also applies. The workers’ constant economic struggle against capital sustains them at every pause in the political battle”.



To maintain a hard and fast divide between the economic and political spheres, as was the case with the reformists, is to shut off the mutually reinforcing dynamic that gives the movement as a whole its strength. Further, in line with Marx’s insistence that the overthrow of capitalism and the construction of a socialist society can succeed only on the basis of the self-activity of workers, Luxemburg drew out the way in which mass strikes support the political and organisational advance of the working class. The spontaneous emergence of the Russian soviets (workers’ councils) during the events of 1905 provides the clearest illustration of this, showing that even the most astute and engaged party or trade union committee could be no substitute for the experience of the mass of workers in struggle.

The task of a revolutionary party is not, therefore, to set out an ordained path or schema that workers obediently follow toward the achievement of socialism. It is, rather, to be immersed in the everyday struggles of workers, and to develop the political experience, with and alongside workers, that alone provides the foundation for leadership in a period of revolution.

Luxemburg spent the majority of the years from the outbreak of World War One in 1914 to the revolution of November 1918 behind bars, imprisoned for being one of the very few people in Germany with the courage to speak out against the slaughter unfolding in the trenches. In the Junius Pamphlet, written from her cell in early 1915, she painted a vivid picture of the choice she believed humanity faced in those years: “Either the triumph of imperialism and the collapse of all civilization as in ancient Rome, depopulation, desolation, degeneration—a great cemetery. Or the victory of socialism, that means the conscious active struggle of the international proletariat against imperialism and its method of war”.

Luxemburg saw clearly that imperialism was part of the core logic of capitalism and that its inevitable consequence was war. Her words, written amid the carnage of World War One, provide a reminder of the consequences for humanity if the imperialist rivalries of today, such as that between China and the US, break out into open war.

The tragedy of Luxemburg’s life is that, by the time she realised the necessity of breaking with the SPD and of building a clearly revolutionary organisation, it was too late. The weakness of the revolutionary left during the war meant that, in the decisive battles of the postwar years from 1918 to 1923, revolutionaries were always running to catch up, giving the SPD leaders and other reactionary forces in Germany the time they needed to regroup. The true cost of these defeats is shown in subsequent German history, as it rushed headlong toward the catastrophes of the 1930s and 1940s.

Luxemburg herself was murdered, along with her comrade Karl Liebknecht, on the night of 15 January 1919. They were among the main leaders of the insurgent movement of workers, sailors and soldiers that had brought World War One to an end and which was threatening to topple the entire capitalist order of Germany. Captured by a division of the reactionary Freikorps on orders from SPD leader (and professed “socialist”) Friedrich Ebert, Luxemburg’s skull was smashed by a rifle butt and her body dumped into Berlin’s Landwehr canal.
Read more
Human nature is no barrier to socialism


The murders of Luxemburg and Liebknecht were a major blow to the immediate hopes of the German (and by extension, the world’s) working class. But Luxemburg’s legacy as a revolutionary activist and theorist couldn’t be extinguished so easily. Her ideas, whether on the question of reform versus revolution, the significance of the mass strike or the civilisation-threatening barbarism of imperialist war, are as relevant today as ever.

Increasing numbers of young people are being drawn to anti-capitalist politics. But just as in Luxemburg’s time, there are competing understandings of the word “socialism” and suggested strategies for winning a better world. There are many today who argue along similar lines to the right wing of the German SPD in the years leading up to World War One—that we should give up on the idea of revolution and be content simply to fight for a better deal for workers and the poor within the framework of capitalism.

There’s no reason to think, however, that if we follow the advice of today’s reformist socialists, we’ll end up with anything much different to the kind of carnage that overtook Europe from 1914 on. Nothing fundamental has changed about capitalism in the intervening period.

Capitalism’s tendency to fall into crisis remains. In fact, the crises are deepening and proliferating. If imperialist tensions between China and the US were, at some point in the coming decades, to break out into a direct military conflict, the consequences for humanity would be even more devastating than in the case of World War One. And today it’s not only the threats of economic devastation and war we need to worry about, but also the potentially existential threat posed by climate change.

The choice we face today is no less stark than that which Luxemburg saw confronting humanity at the height of World War One. Will we allow the continuation of a system that’s propelling humanity into one catastrophe after another? Or will we range ourselves against this system and its defenders (even those supposedly “on our side”), and set a course for revolution? Do we want merely to win a somewhat friendlier version of capitalism, or will we fight for a society and economy democratically and collectively controlled by workers, in which the vast capacities and resources of humanity are no longer sacrificed on the altar of the market, but can be turned to restoring our damaged relationship with nature, and to providing the things we need to live a decent life?

If we want to overcome the barbarism of capitalism, then the need for the kind of clear, intransigent revolutionary politics that Rosa Luxemburg’s life and thought exemplify is more urgent today than ever.





James Plested is an editor of Red Flag.



                                                                    ROSA'S HEIRS

For a Humanist Alternative to Capitalism





Trump appointee busted for insurrection. He worked for a hate group before rioting for Trump.

The State Department aide has a long history of "researching" ways for the religious right to oppose LGBTQ rights.

By Alex Bollinger Friday, March 5, 2021


The Capitol was vandalized during the 1/6 riots.Photo: Shutterstock

A former anti-LGBTQ hate group employee who was appointed to a Trump administration position has been arrested in connection to the MAGA riot at the Capitol.

Federico Klein, 42, was a State Department aide appointed by Donald Trump and he’s now the first Trump appointee to be arrested in connection to the attempted insurrection.

A spokesperson for the FBI’s Washington Field Office told Politico yesterday that Klein was arrested but would not state what charges he is facing exactly.

Klein worked on Trump’s 2016 presidential campaign as a “tech analyst” and then served as a special assistant in the Bureau of Western Hemisphere Affairs at the State Department. He worked at the Office of Brazilian and Southern Cone Affairs before working in an office that handles Freedom of Information Act requests.

At some point before his time in the Trump administration but after he graduated from college in 2002, he worked as a researcher for the Family Research Council (FRC), an SPLC designated hate group that focuses on anti-LGBTQ rights and anti-choice work, according to his LinkedIn profile.

The group has repeatedly associated homosexuality with pedophilia, called being transgender a mental disorder, and painted LGBTQ people as aggressive and harmful to children.

“For years, LGBT activists wanted to keep the goal of luring children into sexual confusion under wraps,” FRC President Tony Perkins said in 2019. “Now that they’ve hoodwinked a lot of the country on their agenda, these extremists no longer have to hide. In fact, they are increasingly bold–even boastful–about their real intentions of recruiting kids.”

The story provides yet another connection between Trump and the angry mob of his supporters who stormed the Capitol in January in an attempt to reverse the results of the 2020 elections, which President Joe Biden won. The protestors, carrying explosives and other weapons, illegally pushed past security to enter the building while lawmakers were evacuated.

They set up a noose outside the Capitol, looted the building, and chanted for the death of Mike Pence. 

Five people died.

His mother Cecilia Klein said that she knew her son was in D.C. in January but “as far as I know, he was on the Mall. That’s what he told me.”

“Fred’s politics burn a little hot,” she said, “but I’ve never known him to violate the law.”

“While I believe, as he said, he was on the Mall that day, I don’t have any evidence, nor will I ever ask him, unless he tells me, where he was after he was on the Mall.”
South Bay Rep. Zoe Lofgren quietly releases massive social media report on GOP colleagues who voted to overturn the election

Rep. Zoe Lofgren, D-San Jose, (AP File Photo/Andrew Harnik)
By CNN.COM

PUBLISHED: March 5, 2021 
By Lauren Fox | CNN

Democratic Rep. Zoe Lofgren has quietly posted a nearly 2,000-page report documenting social media posts by her Republican colleagues who voted against certifying results of the presidential election on January 6. The information compiled isn’t secret, but the report is another sign of the deep distrust that has settled into the US Capitol in the weeks since the insurrection.

The report chronicles the social media activity of members on public forums immediately before the November election and right after the January 6 riot. The report has been online for a week.

CNN reported earlier Thursday that federal investigators are examining records of communications between members of Congress and the pro-Trump mob that attacked the Capitol, as the investigation moves closer to exploring whether lawmakers wittingly or unwittingly helped the insurrectionists.

In a preamble to the report, Lofgren — the chair of the House Administration Committee — wrote that she had asked her staff to pull the relevant social media posts and compile them in an effort to gather facts.

“Any appropriate disciplinary action is a matter not only of the Constitution and law, but also of fact,” the California Democrat wrote. “Many of former President Trump’s false statements were made in very public settings. Had Members made similar public statements in the weeks and months before the January 6th attack? Statements which are readily available in the public arena may be part of any consideration of Congress’ constitutional prerogatives and responsibilities.”

Lofgren continued, “Accordingly, I asked my staff to take a quick look at public social media posts of Members who voted to overturn the 2020 presidential election.”

Tensions have risen within the Capitol since the January attack. A House floor that once was deemed impenetrable has been surrounded by metal detectors, while Speaker of the House Nancy Pelosi, a California Democrat, has said that “the enemy is within” the House, referencing the rhetoric and behavior of some Republican members of Congress.

“Like former President Trump, any elected Member of Congress who aided and abetted the insurrection or incited the attack seriously threatened our democratic government. They would have betrayed their oath of office and would be implicated in the same constitutional provision cited in the Article of Impeachment,” Lofgren wrote in her foreword to the report. “That provision prohibits any person who has previously taken an oath as a member of Congress to support the Constitution but subsequently engaged in insurrection or rebellion from serving in Congress.”

The report features a collection of social media posts and tweets that span dozens of pages from Arizona Rep. Paul Gosar where he urges supporters to “hold the line,” days before what would become the Capitol insurrection. In another social media post included in the report, Gosar wrote that “sedition and treason for stealing votes is appropriate.”

The report also captures numerous tweets where Gosar invoked @ali on Twitter, which was formerly the account used by Ali Alexander, a leader of the “Stop the Steal” group, who said in several Periscope livestream videos that he planned the rally that preceded the riot in conjunction with Gosar and two other congressional Republicans, Mo Brooks of Alabama and Andy Biggs of Arizona.

CNN has reached out to Gosar’s office for comment.

The-CNN-Wire™ & © 2021 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

 


Greenpeace paints Air France jet green in daring eco-stunt

Nine Greenpeace activists were arrested for vandalizing an Air France jet with green paint Friday as part of an eco-protest that raised  concerns about airport security

Aeroports de Paris (ADP), the body that runs Paris’ airports, said the activists got inside Charles de Gaulle airport by scaling a fence at the edge of the tarmac.

ADP said the demonstrators "were immediately intercepted and contained by the police. They were therefore unable to access the runways. Aviation safety has not been compromised and air traffic continues normally.”

Greenpeace said that the stunt was carried out to raise awareness on “greenwashing” of climate change and environmental regulation. It also said it was organized ahead of a climate bill debate in the French Parliament.

“We would like to firmly remind you that the technological innovations so much praised by the Minister for Transport, Jean-Baptiste Djebbari, will not be enough to stem the climate crisis,” the group said in a tweet.

The National Airline Pilots Union (SNPL) was quick to denounce the stunt, saying that the “intrusion into the airport’s secure area” and “deliberate vandalizing” of an aircraft will result in heavy costs to get the plane cleaned.

The SNPL also defended the aviation industry again the activists' claims. It said: “Today, companies buy planes that consume between 2 and 3 liters per passenger per 100 km, which is the consumption of a hybrid car.”

UNION JOBS 
Mandatory COVID-19 testing in place as
thousands return to LNG work sites,
camps in northern B.C.
JUST ANOTHER DRUG TEST

© Betsy Trumpener/CBC Crews were on the job during the pandemic, building a Coastal GasLink work camp near Vanderhoof, B.C., in June 2020.

More than 3,000 industrial workers are set to arrive this month at work camps and construction sites at an energy mega project in northern B.C., with the majority coming from outside the region.

That's according to LNG Canada and Coastal GasLink, as work on their $46-billion natural gas pipeline and LNG export terminal ramps up after slowdowns caused by the COVID-19 pandemic.

The influx of workers has raised concerns from health officials and residents in the area about the risk of coronavirus transmission in communities close to work sites and camps.

But LNG Canada and Coastal GasLink, who are partners in the project to move natural gas from northeast B.C. to the province's North Coast for export to Asia, say that's being mitigated by the rollout of mandatory COVID testing for all workers, whether they're symptomatic or not.

Provincial Health Officer Dr. Bonnie Henry permitted LNG Canada and Coastal GasLink to gradually increase the number of workers on site earlier this year, under stringent conditions. By the end of March, the number of people working on the pipeline and export terminal is scheduled to increase to almost 6,000 from fewer than 1,000 at the start of the year.

Even while operating with reduced staff, the mega project wasn't immune to the spread of COVID-19.

Northern Health declared four different COVID-19 outbreaks at Coastal GasLink and LNG Canada work sites or camps between November and January, with a total of 128 workers infected.
Airport testing

To allay fears of potential future outbreaks, company-funded rapid testing is ramping up for fly-in workers from outside the region, with testing in place at airports in Vancouver, Nanaimo, Kelowna, Calgary, Edmonton, and Ontario.

An LNG Canada spokesperson says the company has already administered antigen tests to 1,700 workers before they boarded charter flights at the Edmonton and Calgary airports.

The company said out-of-town workers are prohibited from leaving the job site except to return home on their days off, and they will be re-tested each time they return to the region. They're also barred from visiting local businesses.

Local workers will be tested every three weeks, said LNG Canada, which is already operating three on-site private health clinics with COVID-19 isolation wings.

Coastal GasLink said it has started testing employees at two work camps using PCR testing, which can deliver results within 48 hours, and plans to expand that to workers along the pipeline's 670-kilometre construction route.

"This is another layer of protection, to keep our workforce and communities safe," said Michael Gibb, Coastal GasLink's director of health, safety and security.

Previously, the private sector wasn't able to requisition test kits and labs, Gibb said.

"In the early days of the pandemic, any available testing and supplies, the government immediately grabbed, as they should, for public health," he said.
'Cadillac private health system'

But Dr. David Bowering, a retired chief medical health officer with Northern Health who lives in the region, says the elevated risk of transmission remains.

He also said it's unfair that mega projects like these can afford to "import this deluxe, Cadillac private health system and level of testing," while the public health system is "rationing COVID testing for people just doing ordinary things like trying to run restaurants and stores."

"It doesn't feel right, the granting of essential service status to these huge projects ... while everything else stops and shuts down and changes so dramatically," Bowering said.

Coastal GasLink's Gibb said it's up to public health officials to determine if there's a need for expanded community testing.

Last year, LNG Canada donated $500,000 for COVID-19 response measures in Kitimat, Terrace, and local Indigenous communities.

District of Kitimat Mayor Phil Germuth welcomes the return of workers to his community, where the LNG export terminal is under construction.

"It's good to see they're going to start ramping up again and get the project back on track," Germuth told CBC News. "Honestly, I haven't had a single person come to me with concerns."

Germuth said LNG Canada's new testing protocols make him "very confident that ... everything will go as smoothly as it can."

Three other large industrial projects in northern B.C. have also been granted permission by provincial health officials to increase their work force.

A spokesperson for the Trans Mountain pipeline expansion project said the company expects as many as 1,000 workers will be on the job in the Valemount area, between Jasper and Prince George, within the next three months, as work proceeds on twinning an oil pipeline between Alberta and Burnaby, B.C..

In the Kitimat area, Rio Tinto's B.C. Works project is planning for a "gradual ramp-up ... when it is safe to do so," a company spokesperson told CBC News.

A spokesperson for BC Hydro's Site C dam project near Fort St. John said the number of workers on site is expected to increase to more than 2,300 in the coming weeks, with additional workers expected in summer.

U.S. ITC criticizes Ford for pursuing SK Innovation battery deals

By David Shepardson and Heekyong Yang 
3/5/2021

© Reuters/Wolfgang Rattay FILE PHOTO: Ford Motor Co's logo pictured in 2019

WASHINGTON/SEOUL (Reuters) - The U.S. International Trade Commission (ITC) on Thursday criticized Ford Motor Co for pursuing battery contracts with SK Innovation after evidence had emerged the South Korean electric vehicle (EV) battery maker misappropriated trade secrets from cross-town rival LG Chem.

The ITC last month sided with LG Chem in its trade secrets claims, issuing a limited 10-year exclusion order prohibiting imports into the United States of lithium-ion batteries by SK Innovation (SK). It permitted SK to import components for domestic production of batteries for Ford's EV F-150 program for four years, and for Volkswagen of America’s MEB electric vehicle line for North America for two years.

In a redacted version of its full 96-page opinion Thursday, the ITC questioned why the second largest U.S. automaker had continued to pursue battery contracts with SK Innovation "after SK's misconduct in this investigation had come to light."

It said Ford had sought business with SK even after a company employee in November 2019 was deposed in the commission's investigation and at a time when it only had a contract with SK to supply batteries for the EV F-150.

"There is no explanation in the record why Ford would choose to ignore or excuse SK's egregious misconduct," the ITC added. "The fault here belongs with SK, as well as with those, like Ford, who deliberately chose to continue to cultivate prospective business relationships predicated on SK's trade secret misappropriation."

The ITC also rejected Ford's request to extend exemptions to Ford's unannounced new EVs.

"Ford's basis for extending the exemption is to take advantage of economies of scope by using similar SK batteries with misappropriated technologies across several unnamed vehicles," it said. "The commission finds the evidence concerning the public interest does not support Ford’s request."

Ford declined to comment on Thursday, referring to its previous statement that the ITC decision supported its efforts to bring its EV Ford F-150 to market in mid-2022.

SK Innovation has warned previously that the decision would force it to halt construction of a $2.6 billion battery plant in Georgia if not overturned by President Joe Biden.

It said on Friday the finding could destroy thousands of high-tech green energy jobs, frustrate plans to protect the environment and "endanger U.S. national security" by making it more dependent on Chinese companies for batteries.

"Thankfully, it is entirely within the discretion of the Biden administration to undo it," SK said.

LG Chem noted the ITC ruling found SK misappropriated LG trade secrets "worth billions of dollars spanning the entire electric vehicle battery business... The release of the ITC's decision puts to rest any questions of whether SK Innovation did anything wrong — they did, repeatedly, and now they must be held accountable."

The ITC said SK Innovation was at least a decade behind LG Chem citing "the very large volume of stolen trade secret documentation, and the expertise improperly acquired by (SK Innovation) from the former LG Chem employees it hired away."

The ITC also found the "investigation demonstrates not merely SK's eagerness to destroy documents, but also SK's callous disregard to ascertain the scope of the destruction after the commencement" of ITC proceedings.

SK Innovation shares fell as much as 6.3% in morning trade, hitting their lowest since mid-January, while LG Chem shares rose 3.7% against a 0.8% decline in the broader KOSPI.

VW has sought at least a four-year extension like Ford.

The ITC opinion said "VW's preference for less expensive batteries using misappropriated LG trade secrets — in perpetuity, no less — is not a compelling public interest."

VW said Thursday the "ruling will only limit competition, reduce U.S. battery capacity, hurt consumers and cost American jobs. Our team is working with the U.S. Trade Representative to avoid these consequences."

(Reporting by David Shepardson in Washington and Heekyong Yang in Seoul; editing by Richard Pullin)


What's really driving coal power's demise
Jeffrey York, Associate Professor of Strategy and Entrepreneurship, University of Colorado Boulder and David Drake, Assistant Professor of Strategy, Entrepreneurship and Operations Management, University of Colorado Boulder


<span class="caption">The use of coal for electric power has been declining fast in the U.S.</span> <span class="attribution"><a class="link rapid-noclick-resp" href="https://newsroom.ap.org/detail/TrumpEnergyPlanLawsuit/813504a562c64f3d9a1740cc5c40aa91/photo" rel="nofollow noopener" target="_blank" data-ylk="slk:AP Photo/J. David Ake">AP Photo/J. David Ake</a></span>
The use of coal for electric power has been declining fast in the U.S.
 AP Photo/J. David Ake
Mon, March 1, 2021

The Research Brief is a short take about interesting academic work.

The big idea

People often point to plunging natural gas prices as the reason U.S. coal-fired power plants have been shutting down at a faster pace in recent years. However, new research shows two other forces had a much larger effect: federal regulation and a well-funded activist campaign that launched in 2011 with the goal of ending coal power.

We studied the retirement of U.S. coal-fired units from January 2008 to September 2016 and compared the effects of various market factors, regulations and activism on their early closure. In all, 348 coal-fired units either retired or switched to natural gas during that time.

Among the many pressures on coal power that we reviewed, a federal regulation implemented in 2015 had the biggest overall effect. The Cross State Air Pollution Rule requires states to reduce soot and smog pollution that blows across states lines, including from power plants. We estimate that it was responsible for reducing the expected production life of the coal power units that it affected by a total of 1,170 years.

Looking at coal units individually, however, we found that the Sierra Club’s Beyond Coal campaign, backed by over US$174 million to date from Bloomberg Philanthropies, had the most impact per targeted plant.

The campaign works by generating public pressure on utilities and state and local politicians to close down coal-fired units, often through targeted lawsuits. When the Beyond Coal campaign targeted a coal-fired unit, we found that the unit’s life expectancy, normally 50-60 years, was reduced by an average of just over two years.

The Cross State Air Pollution Rule was the second-biggest factor per individual plant, though it affected more plants. It reduced the expected life span of each coal-fired generating unit that it affected by an estimated average of about 21 months.

We were surprised to find that neither low natural gas prices nor the adoption of renewable energy significantly reduced the life of coal units. Both have been widely touted by politicians and business leaders as the market-based drivers of coal plant retirement.

Chart of the changing costs of coal and gas
Falling natural gas prices had little impact on coal-fired power plant closures. David Drake and Jeffrey YorkCC BY-ND

However, while adoption of renewable energy alone did not reduce coal units’ life spans, the average use of each source of renewable energy in an area did have a significant impact. Coal units operating in regions with high average renewable energy use retired an average of 15 months earlier.

It is important to note that a large number of coal plants were already nearing the end of their lifecycles during this period. But through statistical modeling, we were able to isolate the impact of each of these interventions on accelerating the retirement of a given unit.

Why it matters

A rapid transition away from carbon-intensive energy sources such as coal is essential to reduce greenhouse gas emissions that are warming the planet. Burning coal releases nearly twice as much carbon dioxide per unit of energy produced as natural gas does, and natural gas’s contribution to global warming is significant.

From 2011 through 2018, coal-fired generating capacity in the U.S. contracted by 23%. We estimate that the emissions impact of the accelerated retirements we studied was equivalent to taking 38 million typical passenger cars off the road.

The common narrative has been that market forces and economics have driven the demise of coal. However, our research suggests that a continued focus on federal policy is a more effective route for reducing emissions.

The Biden administration has already halted new leases for coal, oil and gas extraction on federal lands. And its climate task force – which includes the Cabinet-level department and agency heads – met in February to start coordinating governmentwide climate change solutions. Those likely will include new regulations and could include a price on carbon.

What’s next

Our current work sheds light on where responsibility lies for the acceleration of coal-fired power unit retirements through late 2016.

Next, we are interested in expanding on our findings about differences between renewable energy use and initial adoption. Understanding how to increase use of renewable sources, while creating new businesses and jobs, is a critical research agenda for addressing climate change.

This article is republished from The Conversation, a nonprofit news site dedicated to sharing ideas from academic experts. It was written by: David DrakeUniversity of Colorado Boulder and Jeffrey YorkUniversity of Colorado Boulder.


Shale’s Private Army Ramping Up Means Supply Wild Card for OPEC


David Wethe, Kevin Crowley and Sheela Tobben
Mon, March 1, 2021

(Bloomberg) -- The battered and bruised U.S. shale industry is finding a resurgence in one of the most unlikely places: private operators most investors have never heard of.

Take the case of little known, closely held DoublePoint Energy. It’s now running more rigs in the Permian Basin than giant Chevron Corp. Meanwhile, family-owned Mewbourne Oil Co. has about the same number of rigs as Exxon Mobil Corp.

That’s emblematic of what’s happening across the industry. Once minor players, private drillers held half the share of the horizontal rig count as of December. It’s the first time in the modern shale era that they have risen to the level of the supermajors.


That’s happening when, after years of unwieldy supply growth, the big guys are finally starting to show restraint. They’ve dialed back drilling after the pandemic sent oil prices into collapse. Now that the market is on the rise again, the majors and publicly-traded counterparts are mostly sticking to the mantra of discipline, all but ending shale’s decade-long assault on OPEC for market share.

But private operators’ ambitious growth plans present the cartel with a wild card as prices rebound and it attempts to lift its own production.

“It’s amazing on both fronts: private companies are getting so much bigger than we ever thought they would and the publics are drilling so much less than we ever thought they would,” said Wil Vanloh, co-founder of the private equity firm Quantum Energy Partners, whose portfolio companies have combined for 18 rigs, trailing only EOG Resources Inc. for most in the nation.

With oil prices up close to 30% in the past two months, traders and analysts are watching shale producers closely for signs that they’re opening the spigots. Most big publicly traded explorers are listening to investors’ pleas and planning to keep production flat. But the contrast in output strategy from the private companies underscores just how anarchic the oil market is.

America’s oil production currently stands at about 9.7 million barrels a day, about 3 million barrels a day less than a year ago before prices collapsed, according to the Department of Energy. That means the U.S. lost production equivalent to Iran and Angola combined, or two Gulf of Mexicos, in just 12 months.

The question is where does it go from here. A Bloomberg survey of major forecasters including Enverus and Rystad Energy showed a variance of 700,000 barrels a day, more than half of Nigeria’s production, indicating how much uncertainty surrounds large, private producers whose plans are mostly shielded from public view.

If private drillers keep expanding at their current pace, it could eventually mean that U.S. production ends up on the higher end of analyst forecasts. And that, of course, could weigh on prices.

“In a few months, a lot of private operators will return in an aggressive manner to add wells and rigs because they are able to realize returns faster as oil prices are improving,” said Artem Abramov, head of shale research at Rystad.

The private drillers are on pace to spend $3 billion in just the first three months of this year, doubling from their lowest levels of 2020, according to industry data provider Lium.

The spending spree is leading to a rig resurgence. The number of U.S. drilling rigs that can bore a hole a mile deep and turn sideways for another two miles has steadily improved since history’s worst crude-price crash forced a 15-year low in August. Most of that growth has come from the private companies.

The private drillers reached a record 50% share of the horizontal rig count in December, up from 40% a year earlier.

“We are expecting output to start growing from the second half of this year, and that will likely come more from drilling by private companies than public ones,” said Bernadette Johnson, vice president for strategy and analytics at Enverus.

DoublePoint Energy, backed by investors including Quantum, has doubled production to about 80,000 barrels a day in the past year and expects to increase to more than 100,000 barrels a day over the next few months, according to Co-Chief Executive Officer Cody Campbell.

“The publics are under a lot pressure to be disciplined with the capital they spend,” Campbell said in an interview. “They don’t have the freedom to go after returns like we can.”

That freedom means the private operators could also become more of a thorn in the side of OPEC+ if they keep expanding over the next six months to a year, said Daniel Cruise, a partner at Lium. The producer group, which meets on March 4 to discuss strategy, has been withholding barrels to support the market even as some key members disagree on the path forward.

“If these guys stay out in the field and keep pumping and shale goes up, then that presents a whole other thing for OPEC,” Cruise said.

Saudis, Russia Differ Again on Oil Strategy Before OPEC+ Meeting

Some of the discipline on the part of the publicly-traded independents comes from experience.

For years, companies pledged sky-high returns even when oil was as low as $50 a barrel. But those promises were never kept. Over the past decade, shale oil and gas producers burned through more than $300 billion in capital spending above the cash generated from oil revenues, according to Deloitte LLP. That resulted in massive flows of oil but little in the way of financial returns to investors.

Indeed, oil’s dizzying collapse last year is still fresh in the minds of many, and shareholders are quick to punish the producers they think are getting too aggressive. Matador Resources Co. was widely questioned when it recently announced plans to add one rig to its Permian Basin holdings. The stock fell as much as 10% after the announcement.

Meanwhile, private equity-backed companies are being driven to pump harder than ever before because of a more complicated exit strategy.

Many of these suppliers started up around 2014 to 2017. At the time, it was enough for a private driller to acquire some land, put in a few wells, and they’d quickly get bought up in a lucrative sale as the public producers tried to increase reserves.

But with the decline in prices, it takes a lot more for a private driller to look attractive enough to tempt the now more-disciplined majors. Many private companies have little choice but to expand output and increase cash flow in the hope that they can lure public companies down the line when oil markets and valuations improve.

“You’ve got Major League Baseball and you’ve got the minor leagues, and the private equity backed companies were kind of like the minors,” Vanloh of Quantum said. “They were serving up opportunity, aggregating land, drilling some wells, proving some things up, but they didn’t really want to run a large-scale drilling program.”

The private companies insist they won’t fall victim to shale’s past losses because all the operational difficulties have now been worked out of the major basins, making it easier to run large rig programs.

“The guesswork just isn’t there anymore, everything is just extremely repeatable,” DoublePoint’s Campbell said. “That’s a hard story to tell if you’re a public company and dealing with investors who have been burned.”

©2021 Bloomberg L.P.