Jobless rate soars to 18.9 percent in Merced County
As stores closed, retail sector shed 500 jobs in January...JONAH OWEN LAMB
Merced County continues to hemorrhage jobs, with an unemployment rate so steep it prompted a U.S. congressman to declare the county and environs an "economic disaster area."
The jobless rate also stands among the highest in the nation.
In January, Merced's unemployment rate climbed to 18.9 percent, a 3.2 percentage point increase from December's 15.7, according to the state's Employment Development Department.
The county now has the dubious distinction of being the county with the fourth-highest unemployment rate in California.
California's unemployment rate, which is almost two percentage points above the nation's, increased in January to 10.6 percent.
During that period the county lost a total of 2,700 jobs. That was almost twice the losses seen in January 2008, which saw an unemployment rate of 13.4 percent.
The major industries hit at the opening of 2009 were trade, government, manufacturing and construction.
Retail job losses topped the chart with 500 layoffs. But manufacturing and local government weren't far behind. Three hundred manufacturing jobs disappeared in January, as did 400 county government jobs. Additionally, the already hard-hit construction sector continued its downward spiral with 200 lost jobs.
But Pedro Vargas, a labor market consultant for the EDD in Merced, noted that not all signs were bad.
Merced has still not hit the peak 21.7 percent unemployment rate it reached in February 1996, he said. That record came in the wake of the shutdown of Castle Air Force Base.
And there were 300 new jobs created by local business in January, he said.
Despite the job losses, "there are some good signs that the economy is going to pick up within the next couple of months," he said. Still, retail sales remain a problem: "The negative I'm seeing is that retail is down. People are not out there buying."
At the national level, worries over the region's economic health have grown as well.
The jobless crisis has reached such a state that this week Congressman Dennis Cardoza is formally requesting President Obama and Gov. Schwarz-enegger to declare California's 18th Congressional District an economic disaster area. "The idea is that once something like that happens we would be able to get some additional resources," said Cardoza's spokesman Mike Jensen.
This move by Cardoza was motivated by a combination of events and forces. "It's just been a snowball of things. Between foreclosures and the numbers that came out today, obviously the situation is not good for Merced County and 18th congressional district," said Jensen.
On Thursday afternoon, Albaro Avila and his wife Alice were headed into the county's employment service, Worknet. Avila has been unemployed for more than a year after he lost his job as a tire technician in Madera County. The couple moved to Merced to live with family in December because they could no longer afford to pay their rent. "It's been very tough," said Avila about his job search. "I've been everywhere."
His wife, Alice Avila, thought it ironic they've ended up in Merced, which has an even higher unemployment rate than Madera.
Ironic maybe. But not funny.
Calif. rail project needs cash to keep going...STEVE LAWRENCE, Associated Press Writer
SACRAMENTO -- California will have to halt work on its high-speed rail project if it does not get an infusion of cash soon from the state's frozen infrastructure fund, the project's executive director said Thursday.
Director Mehdi Morshed said the project is out of money and unable to pay its bills, despite voters' approval last November of a $9.9 billion bond measure to help fund the first leg of the 800-mile system.
"If we do not have any money for the next few months, we can't in good conscience ask people to keep working," he said. "We would have virtually no choice but to do the responsible thing and stop work."
Some private contractors performing engineering and environmental reviews already have stopped work because they haven't been paid.
The rail board has asked the state's Pooled Money Investment Board for a loan of $29.1 million to cover its expenses through the end of June. The money would be repaid once the state is able to sell some of the voter-approved bonds.
The investment board has frozen funding for high-speed rail and 5,300 other public works projects, ranging from new classrooms to carpool lanes, because of California's budget problems. The fund's managers say they don't know when that freeze will be lifted.
Two weeks ago, lawmakers approved a combination of tax increases, spending cuts and additional borrowing to erase a nearly $42 billion budget deficit through June 2010.
Officials are waiting to see if that budget correction improved the state's revenue picture enough to lift the freeze, or at least ease its effects. The board is scheduled to meet March 18.
The state treasurer's office is hoping the bond market will improve enough so California can begin selling bonds again, which would generate money for infrastructure projects.
"It has shown signs of improvement since the beginning of the year," said Tom Dresslar, a spokesman for state Treasurer Bill Lockyer. "We're going to be as aggressive as we possibly can be to get back in."
The rail project's money shortage comes as it's hoping to snag a significant piece of the $8 billion for high-speed and commuter trains contained in the federal stimulus bill President Barack Obama signed last month.
The money is intended for projects that will be ready for construction by 2012. If California's funding shortages delay work, the state could lose some of that money, Morshed said.
Official: Nuclear waste won't go to Nevada site...H. JOSEF HEBERT, Associated Press Writer
WASHINGTON -- For two decades, a ridge of volcanic rock 90 miles northwest of Las Vegas known as Yucca Mountain has been the sole focus of government plans to store highly radioactive nuclear waste.
Despite the $13.5 billion that has been spent on the project, the Obama administration says it's going in a different direction.
It slashed funding for Yucca Mountain in its recently announced budget.
And on Thursday, Energy Secretary Steven Chu told a Senate hearing that the Yucca Mountain site no longer was viewed as an option for storing reactor waste, brushing aside criticism from several Republican lawmakers.
Instead, Chu said the Obama administration believes the nearly 60,000 tons of used reactor fuel can remain at nuclear power plants while a new, comprehensive plan for waste disposal is developed.
Chu's remarks touched off a sometimes testy exchange with Sen. John McCain, R-Ariz., Obama's rival for the presidency last year, and provided the most definitive signal yet that the government's attempt to address the commercial nuclear waste problem is veering in a dramatically new direction.
At the hearing, McCain and Sen. Lisa Murkowski, R-Alaska, said the decision not to pursue the Yucca Mountain project threatens the expansion of nuclear energy because the government can give no assurance on waste disposal.
"We've spent billions of dollars and many years preparing for Yucca Mountain to be our nation's nuclear waste site," Murkowski said. "Closing Yucca Mountain sends an unmistakable signal to nuclear developers that they might not have a place to store their waste, making them less willing to develop new facilities."
Congress in 1982 declared that the government must assume responsibility for reactor waste from commercial power plants. Courts have upheld what they call a binding contract with the nuclear power industry. With no lawmakers wanting a nuclear waste dump in their state, Congress five years later declared Yucca Mountain in Nevada as the only site to be considered.
Nevada officials openly labeled it the "screw Nevada bill" and the state's political leaders have fought the project ever since, arguing that the Energy Department has not shown it is an ideal - or even safe - site for nuclear storage.
Obama, campaigning last year ahead of the Nevada primary election, said he agreed with the state's assessment and promised to review the Yucca project.
Last year the Bush administration submitted an application for a construction and operating license to the Nuclear Regulatory Commission.
Obama's 2010 budget calls for scrapping all spending on Yucca Mountain except for what is needed to answer questions from the NRC on the license application "while the administration devises a new strategy toward nuclear waste disposal."
That isn't sitting well with some congressional supporters of nuclear energy development.
"What's wrong with Yucca Mountain, Mr. Chu," McCain asked Thursday at a Senate Energy and Natural Resources Committee hearing on support for scientific research.
"I think we can do a better job," the Nobel Prize-winning physicist replied.
McCain asked whether it was true that Obama - as well as Chu - viewed Yucca Mountain as no longer an option.
"That's true," Chu replied.
"Now we're going to have spent fuel sitting around in pools all over America," shot back McCain, who characterized the Obama position on nuclear waste - and its rejection of waste reprocessing - as a reflection of the administration's opposition to nuclear energy.
Chu said there were short-term answers other than Yucca Mountain, while a long-term solution to dealing with nuclear waste is developed.
"The interim storage of waste (at reactors), the solidification of waste, is something we can do today. The NRC has said we can do it safely," Chu said.
But killing the Yucca Mountain project may not be possible by presidential directive.
The federal government is obligated by law to accept the used reactor fuel from 104 commercial power reactors, but as yet it has no place to put it. The spent fuel, growing at the rate of 2,000 tons a year, is being held in pools and aboveground concrete containers at reactor sites.
There appear to be no immediate plans by the Energy Department to withdraw the Yucca Mountain license application that is pending at the NRC because to do so could trigger lawsuits from the nuclear industry. The NRC has up to four years to consider the application.
A report to Congress in December by the Bush administration, which strongly supported the Yucca Mountain project, dismissed suggestions that reactor waste be kept at temporary storage sites by the government. That would require Congress to change the law that singled out Yucca for nuclear waste.
County's jobless at highest rate since February 1997...John Holland
The jobless rate in Stanislaus County surged to a 12-year high of 16 percent in January, the state reported Thursday.
Merced County rose to 18.9 percent and San Joaquin to 15.1 percent, clear evidence that the recession has hit the region hard.
"It's brutal," said Donald Whann of Modesto as he scanned job listings on a computer at the Alliance Worknet employment service Thursday afternoon. "You wake up in the morning and just dread facing it."
The figures for the three counties, reported by the state Employment Development Department, were about 5 percentage points higher than January 2008.
Each January typically brings a spike in unemployment because of the lull in farm and cannery work, and the end of the holiday retail season.
It's different in 2009, as layoffs ripple through an economy rattled first by the housing collapse and then by trouble in finance, retail, manufacturing and other sectors.
"We're not doing well at this point," said Liz Baker, a labor market analyst for the state agency. "To be at 16 percent is quite troubling."
The rate was the county's highest since the 16.1 percent in February 1997 and the worst January figure since 1996.
Three years ago, as the housing boom was peaking, the county's January rate was just 8.8 percent.
Construction jobs in the county dropped about 10 percent in January 2009 compared with a year earlier. Manufacturing, retail, restaurants and education declined by smaller amounts, while health care rose slightly.
Nationwide, 7.6 percent of the work force was without jobs in January, less than half the county figure but still a 16-year high. The nation's February rate will be released today.
Unemployment in the region likely will stay high well into 2010, as health care and other sectors get drawn in, said Jeff Michael, director of the Business Forecasting Center at the University of the Pacific in Stockton.
"We're in the steepest part of the decline now," he said. "We've got more layoffs to come across the board."
He said the numbers, although bleak, still are not as high as in the early 1990s.
Food processing fairly stable
The county's large food-processing industry is fairly stable, but other sectors could suffer until the economy sorts itself out, said Bill Bassitt, chief executive officer of the Stanislaus County Economic Development and Workforce Alliance.
He said the jobless rate does not include an unknown number of "discouraged workers" — people who want jobs but have stopped looking.
"I would say that because we have had such sustained high unemployment, we have discouraged workers and we have unemployable people," Bassitt said.
Michael said the jobless figure does not include part-time workers who would rather be full time.
The federal stimulus package enacted last month could preserve jobs in education and other sectors, he said, but its tax cuts could be canceled out by state taxes that are about to rise.
Signs of the region's slump are all around. The Mervyns chain shut its doors after Christmas, and Gottschalks, in bankruptcy protection, faces an uncertain future. County Bank failed and was acquired by Westamerica Bank, which is laying off workers as it consolidates operations. Trim Masters, which makes door trim for Toyota trucks, will lay off some of its Modesto workers next month.
The Alliance Worknet, which offers job listings, training and other services, had a steady stream of clients at its 12th Street building Thursday.
Whann, 54, said he is trying to get back to work as an industrial maintenance technician but has had little luck.
'A lot of praying'
Keith Murphy, 61, of Modesto, who was polishing his résumé at a nearby computer, said he hoped to find work again as a law-enforcement records specialist. He has been looking for three months.
"I do a lot of praying," said Murphy, who moved recently from Atlanta. "My friends and relatives are doing a lot of praying for me."
Out on Carpenter Road, about a dozen men stood in the Home Depot parking lot, hoping for a day's work from a contractor or homeowner.
"It's terrible right now," said Santos Avila, 65, of Modesto, who hoped to make $10 an hour in remodeling, painting, pouring concrete or other work. He said such jobs have been hard to get for the past three years.
"A lot of these guys here are doing the same thing I'm doing — looking for labor, an honest job."
The January jobless report highlights stark differences between poor and more affluent parts of Stanislaus County. The Shackelford neighborhood in south Modesto had a 42.9 percent unemployment rate, while the area just east of Oakdale was at just 5.9 percent. The report breaks down the numbers by city and by other towns and neighborhoods known as "census designated places." Some of the January figures that went into the overall 16 percent jobless rate:
Valley counties see surge in January unemployment...Tim Sheehan
Unemployment in the central San Joaquin Valley lurched upward more than two percentage points in a month as businesses of every kind laid off workers.
The jobless rate in Fresno County hit 15.7% in January, according to figures released Thursday by the state Employment Development Department. That's up from 13.3% in December, and 10.6% in January 2008.
The figures reflect mounting job losses as the national economic crisis tightens its grip on the region. Fresno County lost an estimated 11,700 jobs from December to January, driving the number of unemployed people to about 69,500 -- the largest number ever reported under the current system in state employment data, which began in 1990.
The unemployment figures, economists say, don't include discouraged workers who have given up searching for jobs.
Increases also were reported for Kings, Madera, Merced and Tulare counties. California's unemployment reached 10.6% for the month, up about two percentage points from December.
Steven Gutierrez, a state labor market analyst, said unemployment rates also are up across the nation, which showed a jobless rate of 8.5%. "Many of the states are reporting unprecedented spikes," he said.
In Fresno County, the biggest monthly losses were reported in farm employment, which fell by 5,700 between December and January. However, farm employment was one of the few sectors showing improvement year over year, growing by 1,200 jobs from January 2008.
Other big hits were in government jobs -- about 1,400 fewer than December -- and in retail trades, where 1,200 lost jobs.
Construction jobs in Fresno County decreased by 700 to 15,800, the lowest level since April 2001, Gutierrez said. The number was down 2,100 from January 2008.
"The loss of retail jobs was most likely the result of the end of the holiday shopping season," Gutierrez said. "Retail has basically been taking a hit for the last eight months. ... With consumers tightening their belts, people are being very selective in their discretionary spending."
The number of jobless people in the five-county central San Joaquin Valley region was 141,800 -- a number that many expect will continue to grow this year.
Scott Cain, an economics instructor at the University of Phoenix in Fresno, said farm labor declines likely will add to the region's woes.
"One of the things that still drives Valley unemployment is farm labor," he said. "What had happened is a lot of unemployment attributed to farming in recent years was picked up in construction during the building boom, and we saw our unemployment rate dip below 10% for the first time in a long time."
But when the housing bubble burst, those workers lost jobs, Cain said. "And there's a double-whammy on the west side of the Valley, because there isn't going to be any water -- and the farmers are laying off even more employees."
Throw in the effects of the nationwide recession on nonfarm labor, "and it's not going to be pretty for quite some time," Cain said.
Manuel Cunha, president of the Nisei Farmers League, said that the employment ripples caused by agriculture's constant water battles extend far beyond the Valley's fields, vineyards and orchards.
"The impact of the water crisis isn't just on the workers in the fields," he said. "On the processing side -- in the packinghouses, the trucking companies, the box companies, the parts houses that bring on extra people because the farmers are coming in to buy repair parts -- all of that is going to be ... down."
Cain said growth in other Valley industries, including retail and service businesses, has benefited the region.
"The more diversified economy we can have, the better," he said. "It gives people more options."
But the recession is taking much of the wind out of retail and other sales.
"Consumers are in a state of panic and stocks are the lowest they've been in years," Cain said. "If they get scared, this is what happens."
Jobless rate bolts to 8.1 pct., 651,000 jobs lost...JEANNINE AVERSA, AP Economics Writer
WASHINGTON The nation's unemployment rate bolted to 8.1 percent in February, the highest since late 1983, as cost-cutting employers slashed 651,000 jobs amid a deepening recession.
Both figures were worse than analysts expected and the Labor Department's report shows America's workers being clobbered by a wave of layoffs unlikely to ease in the coming months.
"There is no light at the end of the tunnel with these numbers," said Nigel Gault, economist at IHS Global Insight. "Job losses were everywhere and there's no hope for a turnaround any time soon."
February's net job loss came after even deeper payroll reductions in the prior two months, according to revised figures released Friday. The economy lost 681,000 jobs in December and another 655,000 in January.
Employers are shrinking their work forces and turning to other ways to slash costs - including trimming workers' hours, freezing wages or cutting pay - because the recession has eaten into their sales and profits. Customers at home and abroad are cutting back as other countries cope with their own economic problems.
Since the recession began in December 2007, the economy has lost 4.4 million jobs, more than half of which occurred in the past four months. President Barack Obama called that tally "astounding," but urged the American people to give him time to let his economic revival plans take root.
"This recovery plan won't turn our economy around or solve every problem," Obama said. "All of this takes time and it will take patience."
With employers showing no appetite to hire, the unemployment jumped half a percentage point from 7.6 percent in January. That was the highest since December 1983, when the jobless rate was 8.3 percent.
All told, the number of unemployed people climbed to 12.5 million. In addition, the number of people forced to work part time for "economic reasons" rose by a sharp 787,000 to 8.6 million. That's people who would like to work full time but whose hours were cut back or were unable to find full-time work.
If part-time, discouraged workers and others are factored in, the unemployment rate would have been 14.8 percent in February, the highest on records dating to 1994.
The pain hit blue- and white-collar workers, those without a high-school diploma and those highly educated. The jobless rate for people with a bachelor's degree or higher jumped to 4.1 percent last month from 3.8 percent in January. That's the highest on records dating to 1992.
Meanwhile, the average work week in February stayed at 33.3 hours, matching the record low set in December.
On Wall Street, stocks surrendered early gains as the severity of U.S. job losses began to register with investors. The Dow Jones industrial average dipped about 15 points in afternoon trading and broader indexes also slipped.
Job losses were widespread last month.
Construction companies eliminated 104,000 jobs. Factories axed 168,000. Retailers cut nearly 40,000. Professional and business services got rid of 180,000, with 78,000 jobs lost at temporary-help agencies. Financial companies reduced payrolls by 44,000. Leisure and hospitality firms chopped 33,000 positions.
The few areas spared: education and health services, as well as government, which boosted employment last month.
Disappearing jobs and evaporating wealth from tanking home values, 401(k)s and other investments have forced consumers to retrench, driving companies to lay off workers. It's a vicious cycle in which all the economy's negative problems feed on each other, worsening the downward spiral.
A new wave of layoffs hit this week.
General Dynamics Corp. said Thursday it will lay off 1,200 workers due partly to plummeting sales of business and personal jets that forced it to cut production. Defense contractor Northrop Grumman Corp., and Tyco Electronics Ltd., which makes electronic components, undersea telecommunications systems and wireless equipment, also are trimming payrolls.
The country is getting bloodied by fallout from the housing, credit and financial crises- the worst since the 1930s. And there's no easy fix for a quick turnaround, economists said.
Obama is counting on a multipronged assault to lift the country out of recession: a $787 billion stimulus package of increased federal spending and tax cuts; a revamped, multibillion-dollar bailout program for the nation's troubled banks; and a $75 billion effort to stem home foreclosures.
Even in the best-case scenario that the relief efforts work and the recession ends later in 2009, the unemployment rate is expected to keep climbing, hitting 9 percent or higher this year. In fact, the Federal Reserve thinks the unemployment rate will stay elevated into 2011. Economists say the job market may not get back to normal - meaning a 5 percent unemployment rate - until 2013.
Businesses won't be inclined to ramp up hiring until they are sure any economic recovery has staying power.
The economy contracted at a staggering 6.2 percent in the final three months of 2008, the worst showing in a quarter-century, and it will probably continue to shrink during the first six months of this year.
Given Friday's grim figures, Gault predicted the economy would probably shrink in the first quarter at a pace of at least 6 percent, and that the unemployment rate will rise as high as 10 percent in the first half of 2010.
Fed Chairman Ben Bernanke told Congress earlier this week that recent economic barometers "show little sign of improvement" and suggest that "labor market conditions may have worsened further in recent weeks."
Clovis voters resoundingly reject Measure A sales tax increase...Editorial
Clovis voters sent an unmistakable message to the Clovis City Council and administration Tuesday: Balance the city budget with spending cuts and don't expect taxpayers to dig deeper into their pockets during this tough economic time.
Only about one-third of voters said they were willing to increase the sales tax by one cent. The overwhelming defeat of Measure A could have been predicted, yet the council and administration stubbornly advanced the measure. Now they will have to make more spending cuts, which is what every business and government agency must do to get through the economic downturn.
We agree that the Clovis council members have been responsible stewards, and we respect their leadership in most areas. But a sales tax increase would have been irresponsible. Local governments, especially now, have to tighten their belts, and that means in all areas, including public safety.
Police and fire usually are the last areas to be asked to take budget cuts, while other programs regularly face reductions. While we believe that public safety is the main priority of local governments, that does not mean police and fire can't be asked to operate more efficiently.
Mayor Bob Whalen, the only City Council member who opposed Measure A, wisely said the city will need to examine salaries and benefits paid to employees, administrators and council members. It is time for shared sacrifice throughout city government in Clovis.
While we don't think this is a good time for any increase in the sales tax, the excessive tax included in Measure A showed how out of touch the Clovis council majority is with the people who pay the bills.
Clovis' budget challenges stem from the current economic problems. But instead of a smaller tax increase for three years or so to get through this troubled time, the council demanded voters pass a one-cent increase for the next 10 years, then reducing it to three-quarters of a cent.
Clovis voters saw through the council's attempt to pad city coffers well beyond what is needed to get through this crisis, with 67% of them rejecting Measure A. Now we'll see if the council majority has learned from this political miscalculation.
Interactive Map: January 2009 Unemployment...Phillip Reese
Unemployment increased in almost every California County last month. Forty counties now have unemployment rates higher than 10 percent.
Click on a county to see its unemployment rate. Please give map a few moments to load.
Source: California Employment Development Department
NW salmon dam dispute returns to court...The Associated Press
PORTLAND, Ore. (AP) - A marathon dispute over how to balance hydroelectric dams with the restoration of threatened and endangered salmon and steelhead in the Columbia Basin returns to federal court Friday, March 6.
U.S. District Judge James A. Redden, who has deemed previous plans inadequate, will hear arguments from the lawyers for federal agencies that came up with the latest effort and salmon advocates who think much more needs to be done.
He is also expected to review a motion from salmon advocates seeking more water to be spilled to help juvenile salmon survive their passage over the dams, rather than going through turbines.
The federal agencies, which include NOAA Fisheries Service, the Bonneville Power Administration, U.S. Bureau of Reclamation and the U.S. Army Corps of Engineers, have submitted a plan they feel will help salmon survive as they migrate through the hydroelectric dams.
The Endangered Species Act requires NOAA Fisheries Service to evaluate whether federal projects like the dams jeopardize the survival of protected wildlife. The plan is known as a biological opinion.
Meanwhile, the state of Oregon and National Wildlife Federation, which have filed suit against the U.S., say the plan remains similar to those Redden has rejected before.
"The question is whether the plan the Bush administration put out last May does what the law requires," said Todd True, a lawyer for the legal group Earthjustice, which represents the National Wildlife Federation. "We argue it does not."
Last year, several Northwest Indian tribes agreed to a 10-year plan for habitat improvements and hatchery reforms and removed themselves from the litigation.
"The tribes who signed accords truly believe they got meaningful assets on the ground for the fish," said Charles Hudson of the Columbia Inter-Tribal Fish Commission.
Since the early 1990s, when the first of 13 species of salmon went on threatened and endangered species lists, the issues has been raised in court numerous times.
In June, salmon advocates filed the latest lawsuit, saying the government's most recent plan, which was issued in May, ignores the best possible science, which they say calls for removing four dams along the lower Snake River in Eastern Washington.
Redden has ruled in the past that the federal plans for the dams did not do enough to promote recovery of threatened salmon, violating the Endangered Species Act.
Brian Gorman, a NOAA spokesman in Seattle, said the federal agencies are optimistic they won't be asked to redo their plan as they have in the past, largely because they have worked to develop a new plan that does more to benefit the fish.
He also noted the biological opinion was backed by tribes that helped shape the final plan.
"I can't stress the overwhelmingly collaborative process and the degree to which it has resulted in what I believe is a very good document," Gorman said. "It's clear the judge feels the federal agencies have made a fair amount of progress - whether he feels we made sufficient progress remains to be seen."
Proposed bill would slash protection, funding for striped bass...Alex Breitler
SACRAMENTO - Striped bass, one of the most valued sport fish in the Delta, would lose protection and funding under a bill introduced by a south San Joaquin Valley lawmaker.
Some feel the hungry stripers are partly to blame for the decline of the Delta smelt, whose plummet toward extinction may crimp water deliveries from the estuary to two-thirds of California.
But the stripers' culpability is not certain.
One leading fishery scientist said Thursday there is no hard evidence that the nonnative stripers have caused fish populations to decline.
"They do not feed on Delta smelt by and large," said Peter Moyle of the University of California, Davis. "Even when smelt were abundant, it was rare to find them in bass stomachs."
Assemblywoman Jean Fuller, R-Bakersfield, introduced the legislation to "strike a balance" in the Delta in part by removing restrictions on striped bass fishing.
She said that while this would not solve the Delta's problems altogether, it would address one of the known factors for the decline not only of smelt but also salmon and steelhead.
Her office provided excerpts Thursday from agency documents and studies reporting, in general, that stripers are voracious predators.
That may be true, but many consider the species to be beneficial. The 1992 Central Valley Project Improvement Act, a massive environmental law, said striped bass required protection alongside salmon, steelhead and sturgeon. The law called for the doubling of populations of these migratory fish, whose numbers have declined over the decades.
A recently rewritten opinion by U.S. Fish and Wildlife Service said it's unknown whether stripers kill significant numbers of smelt.
Stockton environmentalist Bill Jennings said Fuller's bill is an attempt to divert attention from the primary cause of the Delta's decline: The export pumps.
And Stockton fisherman Jay Sorensen called striped bass one of the most important fish to the economy of the Delta.
"They should be listed by now as a native species," he said. "They've been here since 1878."
The striped bass is popular enough that it has its own club: The California Striped Bass Association, with about 100 Stockton-area members, President Cliff Rich said.
"If they deregulate the striped bass and the smelt are gone and the salmon are gone, what's the next species they're going to pick on?" Rich said Thursday.
A related lawsuit filed by farmers in the south Valley against the state Department of Fish and Game is pending in federal court.
At a glance
Assembly Bill 1253 would:
• Prevent any more striped bass from entering the state
• Discourage promotion of the striped bass fishery in the Delta
• Eliminate restrictions on how, where and how many striped bass can be caught
• Eliminate funding for enhancing striped bass populations or habitat
To read the bill, visit www.leginfo.ca.gov.
Foreclosures now center on jobs
1 in 7 in California in foreclosure or behind in payments...Bruce Spence
STOCKTON - Mortgage delinquencies in California and across the county continued to climb at the end of 2008, despite various default moratoriums, but the root cause has shifted from adjustable-rate mortgage payment jumps to rising unemployment.
So concluded the Mortgage Bankers Association's new fourth-quarter national survey of mortgage delinquencies and foreclosures. The survey covers 85 percent of the mortgage market.
The association found that one in nine homeowners across the country is either behind in mortgage payments or in foreclosure, compared with nearly one in seven in California.
The survey, released Thursday, indicated that nearly 7.9 percent of all outstanding mortgage loans were in delinquency nationwide in the fourth quarter - up nearly a full percentage point. Adding 3.3 percent of homes in foreclosure brings the total of struggling homeowners to a seasonally adjusted 11.2 percent rate.
Meanwhile, California, which has long been one of the leaders in default activity, saw its delinquency rate climb 0.2 percent to 9.1 percent of residential mortgage loans. The percentage of California homes in foreclosure rose to 4.2 percent, meaning that 13.3 percent of California homeowners are in mortgage distress.
The rising numbers increasingly involve prime fixed-rate and subprime fixed-rate loans affected by loss of employment in the sinking economy instead of resetting adjustable-rate mortgages that send monthly house payments jumping, said Jay Brinkman, the association's chief economist
Employment is expected to suffer through mid- to late 2010, he said, and delinquent mortgage and foreclosure activity won't start improving until after that, he said.
"The recovery is going to depend on when the jobs come back," Brinkman said.
California and San Joaquin County are both getting blistered with worsening employment scenes.
The state unemployment rate spiked from 8.7 percent in December to 10.1 percent in January with the loss of nearly 80,000 jobs.
San Joaquin County unemployment numbers took a 2.1 percentage point leap in January to 15.1 percent - the highest jobless number for the county in 15 years.
Jeff Michael, director of University of the Pacific's Business Forecasting Center, called Brinkman's prediction that employment won't recover until mid-2010 "a little bit pessimistic, but not overly so."
The national delinquency rate breaks the record set last quarter, and the quarter-to-quarter jump is the largest since the association began tracking mortgage delinquencies in 1972. The delinquency rate includes loans that are at least one payment past due but does not include loans somewhere in the foreclosure process.
California, Florida, Nevada, Arizona and Michigan continue to dominate delinquency numbers, but some of the sharpest increases in loans 90 days or more delinquent were in Louisiana, New York, Georgia, Texas and Mississippi, reflecting the spreading effects of the recession, Brinkman said.
The MBA report contained only national and state figures. But many homeowners in San Joaquin County continue to struggle with mortgage default and foreclosure.
According to the most recent numbers from RealtyTrac Inc., an Irvine-based foreclosure listing service, 629 single-family homes in the county were repossessed by foreclosing lenders in January, down 36 percent from 983 in December. That compares with 1,438 in January 2007.
The drop has been attributed to a delay in foreclosure actions because of voluntary temporary moratoriums and a state law enacted in September requiring lenders to at least make efforts to contact struggling homeowners about loan modifications.
The number of homes repossessed countywide in 2008 more than tripled, jumping from 3,809 in 2007 to 12,188 last year.
The number of repossessions statewide in the same period actually increased at a faster pace, nearly quadrupling for the year, rising from 65,964 in 2007 to 240,138 last year, the company said.
Seeds of recovery
Economists upbeat on effect of population on housing market...Editorial
Is it possible we could grow our way out of this depressed housing market?
That's what Jeffrey Michael thinks. He's director of University of the Pacific's Business Forecasting Center, and this week he made the case that the ever-increasing population of San Joaquin County will ignite another building spree. Eventually.
Tuesday, about the same time Michael was making his forecast at a real estate forum at Pacific, the chief economist of the California Association of Realtors was giving a largely upbeat real estate forecast to real estate agents in Sacramento.
"In Sacramento County, we're through 80 percent of the subprime resets," CAR's Leslie Appleton-Young said. She believes Sacramento will be among the nation's first housing markets to perk up.
Michael made a similar prediction for San Joaquin County, saying excess housing in this foreclosure period will be bought up next year. That coupled with a rising population will push demand to at least 5,300 new homes a year.
That should be good news to builders, who have seen single-family home construction fall from about 6,500 homes in 2004 to a projected 800 this year. The construction slowdown likely will get worse before it gets better, with only about 500 homes expected to be built in San Joaquin County in 2010.
Over the next 20 years, San Joaquin County's population will increase by about 460,000, to 1.2 million. A 62 percent increase in population means more homes will be needed. Lots more.
Waning subprime resets - adjustable mortgage interest rates that increase, pushing the monthly payment higher - in this county are a sign that "we've gone further through the cycle" than other regions, Michael said, echoing Appleton-Young.
"If we can get the jobs market to settle down a little, conditions will be in place to find a bottom in the housing market," he said.
The job market is going to have to settle down more than a little. The county's jobless rate in December was 13 percent, and it didn't get any better in January. The state Employment Development Department said Thursday that in January, the county's jobless rate jumped to 15.1 percent.
Still, there seems to be signs that there's light at the end of the tunnel and it's not just a train coming our way. For Michael and Appleton-Young to see a bit of light is better than much of the economic news of late.
San Francisco Chronicle
State renews push for tougher emission rules...Zachary Coile, Chronicle Washington Bureau
California's top environmental officials appeared at an Environmental Protection Agency hearing Thursday to urge President Obama to make good on his election-year pledge to approve the state's aggressive greenhouse gas rules for vehicles.
President George W. Bush's EPA chief, Stephen Johnson, rejected the state's request in 2007 for a waiver under the Clean Air Act to enforce the California rules. But one of Obama's first officials acts was to order a review of the decision, and state officials believe that his EPA administrator, Lisa Jackson, will overturn it.
"We believe there is no basis for denying the waiver," California Air Resources Board Chairwoman Mary Nichols said at the hearing.
While Obama is seen as likely to back the state and 14 other jurisdictions that have embraced its regulations, his top aides are working behind the scenes on a new approach to fuel economy standards and greenhouse gas emissions that could someday supplant California's rules.
Obama's climate and energy czar, Carol Browner, told governors at a recent meeting that the administration is pursuing a national policy on auto emissions that could lead to tougher fuel efficiency standards. The policy is being worked out among the EPA, the Transportation Department and the Treasury Department, which is trying to keep struggling U.S. automakers afloat.
Automakers, who are reeling from a steep drop in vehicle sales and seeking billions in federal aid, are now shifting their stance: After long opposing efforts to regulate greenhouses gases, either by California or the federal government, they are now urging Obama to craft a national policy that would supersede state rules.
Michigan Sen. Carl Levin, a Democrat and strong ally of the industry, appeared at the hearing to oppose California's waiver request. He said climate change is a global issue that needed more than state solutions.
"There is an urgent need for government action to confront this problem, but the need is for strong national action," Levin said.
Automakers are hoping for federal action for two reasons: First, they hope federal emissions limits will be weaker than California's rules, which require a 30 percent cut in emissions by 2016.
Second, the federal rules are expected to follow the "attribute-based" approach that the industry lobbied for when Congress adopted fuel economy standards in 2007. Those rules, which set different standards for vehicles based on their wheelbase and track width, favor Detroit's Big Three, which sell more SUVS and trucks, over foreign competitors that sell more compact cars.
California's standards, by contrast, would force automakers to reduce greenhouse gases across their entire fleet of cars and light trucks, and trim emissions of heavier trucks by a lesser amount. The state's rules give an incentive to automakers to produce smaller vehicles.
Nichols, in an interview Thursday, said California is not opposed to a single national policy on greenhouse gas emissions from cars and trucks.
"Our hope is there will be a federal program that we can sign onto and endorse," she said. "That would be best for the world."
But, she said, the federal rules must make emissions cuts at least as deep as California's 30 percent reduction by 2016. Nichols added that approving California's waiver would be the best way for the Obama administration to build pressure for strong federal standards.
"It ratchets up the whole debate in the direction it needs to go," she said.
California's rules would require much higher fuel efficiency - about 42 miles per gallon for most vehicles by 2020, according to estimates - compared with a federal standard of 35 miles per gallon by 2020.
The state rules have now been embraced by 13 other states and the District of Columbia, which comprise nearly 40 percent of the U.S. auto market. Five other states, including Florida and Colorado, are considering the rules, which would bring the total to more than half the market.
Linda Adams, secretary of California's Environmental Protection Agency, led off the hearing Thursday by reading a letter from Gov. Arnold Schwarzenegger, who argued that carmakers already have developed many of the technologies they will need to curb emissions.
"In fact, there are already many models available now that comply with the final standards," approved by the state, he wrote. "And we know they can do even better in the future by developing innovative new technologies and techniques that will ultimately make better cars."
California officials showed slides of the technologies - six- and seven-speed transmissions, cylinder deactivation, variable valve timing - that cut emissions. Tom Cackette, deputy director of the state Air Resources Board, pointed out that after automakers spent years saying that efficient turbocharged engines wouldn't work, Ford is now boasting in ads about the "EcoBoost" direct injection V-6 engine on its bestselling F-150 trucks.
"It will be one more tool auto manufacturers can use to reduce light truck emissions," Cackette said.
Automakers said California's rules would be a heavy burden on an industry that is struggling for its survival. John McEleney, chairman of the National Automobile Dealers Association, said the rules would limit choices at dealerships in California and the other states, leading consumers to cross borders to other states to buy heavier-emitting vehicles.
"The bottom line is, in-state dealers lose sales and the ... states lose any environmental benefit," he said.
But Adam Lee, an auto dealer in Maine, which is one of the states that would adopt California's standards, said the rules would force automakers to build the type of fuel-efficient cars and trucks that people want.
"I'm here today to tell you, my customers want clean cars," Lee said. "Why wouldn't you want a clean car?"
Fuel economy rules: By the end of March, the Obama administration is expected to release new fuel economy rules for 2011 model year vehicles to keep automakers on track to meet a 35-mile-per-gallon standard by 2020. This is happening at the same time that automakers are seeking big federal loans.
Waiver decision: The public comment period ends April 6, and officials in California, 13 other states and the District of Columbia all expect a decision quickly, perhaps by June. Approving the California waiver would signal that the Obama administration is serious about tackling greenhouse gases from vehicles.
Endangerment finding: Obama's climate and energy czar, Carol Browner, told governors that the administration will make a finding soon on whether greenhouse gases endanger human health or welfare. The finding would force EPA to develop regulations to limit emissions from power plants, automobiles and other sources.
Bottom line: Obama campaigned pledging to act on climate change, and apparently he plans to do so. A tough economy could lead to some effort to soften the impact on struggling U.S. automakers. Worried about the impact of California's emissions rules, automakers now seem ready to cut a deal with the White House on tougher national standards.
State emissions proposal quickly attacked...David R. Baker, Chronicle Staff Writer
A proposed state regulation designed to promote alternative fuels and cut greenhouse gas emissions from cars drew fire Thursday from ethanol producers, who say the rules discriminate against them.
The California Air Resources Board on Thursday released a draft of its long-awaited "low carbon fuel standard," a key piece of the state's efforts to fight global warming. The proposed rules would lower greenhouse gas emissions from California's fuel 10 percent by 2020. The board plans to vote on the rules at its April 23 meeting.
Supporters see the standard as a way to start weaning California off gasoline and encourage the use of alternatives such as ethanol and biodiesel. But it would discourage some forms of ethanol, in particular ethanol made from corn in the Midwest.
That's because the board's staff examined the greenhouse gases released during every step of fuel production, as well as the indirect effects that biofuels can have on land use. By that standard, Midwestern ethanol used in California releases more heat-trapping carbon dioxide for every unit of energy than does regular gasoline made in the state, according to the board.
"There are some instances where the production of certain fuels - such as sugar cane in Brazil or palm oil in other parts of the world - replaces food production and drives the conversion of other habitats into food production," air board spokesman Stanley Young said. "And when you do that, it increases carbon dioxide emissions."
That infuriates ethanol producers. They say the board didn't add up the indirect land use effects of oil and gasoline production, giving an unfair advantage to fossil fuels.
"It would not only be bad science, but also bad policy to adopt a regulation that creates unfair standards, forces California to continue its reliance on dirty fossil fuels and further damages the state's frail economy," said former presidential candidate Gen. Wesley Clark, now the co-chairman of Growth Energy, an ethanol lobbying group.
Young said the air board did look at the indirect land use effects of fossil fuels and found that there weren't many.
Meanwhile, the companies that run California's gasoline refineries aren't sure they have enough options to cut emissions by 10 percent. The Western States Petroleum Association, which represents those companies, wants the board to delay approval.
"This is the most transforming thing they've ever undertaken," said Catherine Reheis-Boyd, the group's chief operating officer. "We don't see how you can do that before April."
Producers want higher ethanol limits for gasoline...H. JOSEF HEBERT, Associated Press Writer
Ethanol producers are asking the Environmental Protection Agency to boost the amount of ethanol that can be blended with gasoline. They want the ceiling on ethanol content to be raised from 10 percent to 15 percent.
But automakers argue such an increase could damage engines, fuel lines and emission controls. And makers of small engines say the increased alcohol could adversely affect the smooth operation of everything from lawnmowers and chains saws to boats and motorcycles.
Ethanol producers argue studies show the increase would not be harmful to cars. They say lifting the cap would spur demand and help an industry reeling in bad economic times. The EPA said it is reviewing the request and "will act based on the best available science."
Let's all get wet
It's pouring rain and water's gushing everywhere. You call this a drought?...Mark Morford
As I write these words, rain is hammering my apartment building and rivers of fresh water -- hundreds or perhaps thousands of gallons per minute -- are gushing down the streets and the sidewalks, filling rain gutters, overwhelming the storm drains and rinsing the City relatively clean, and you think, ahh yes, rain, bring it on, so healthy, so good, so desperately needed.
Maybe you also think: Surely all that water is going somewhere helpful, yes? Surely at least some of those drains feed into some grand network of reservoirs and tanks that, in turn, replenish the supply and nourish the community and come back through our taps and get recycled for irrigation, and it's all glorious and helpful, right?
Truth is, the vast majority of that glorious water is merely flushed away by a system of conduits and drainage pipes and sent straight out into the bay, all in an effort to avoid urban flooding because, well, we are simply not equipped to handle too much of it at once.
Meanwhile, I read the same dire stories as you. Despite the rain, despite weeks of snow and storms and pounding amounts of water crashing down on the region for hours on end, we are still in very serious drought conditions. Long-starved state reservoirs aren't even half full. The governor declared a state of emergency. The Colorado River is long overtaxed, lakes are drying up, the besieged Sacramento-San Joaquin river delta is being siphoned off at a record pace. We do not, they say, have nearly enough water. And it's getting worse.
It seems to prompt one ridiculously obvious, but still increasingly urgent question: How can this be? How is it that tens of thousands of gallons of fresh water are pouring through the city streets right now, but we are only able to capture and use but a fraction? Why do we not have better systems in place? Why is this not more imperative?
Is that too naïve to ponder aloud? Hardly. Sure, we all know the state has its grand reservoirs, the spring snowmelt is the lifeblood of the aquifers, the rainfall feeds the starving, overbled rivers and deltas. But what about what's right here, right now? What about what every single city, every single person, every single household isn't doing in the slightest?
Why do we not, for example, have in place regulations similar to what much of drought-plagued Australia's already done, mandates requiring that every homeowner cut their usage in half and every home and building be fitted with a basic water-capture and storage apparatus -- along with solar panels and compost and so on -- aiming toward at least some semblance of self-sustainability? How is it we are still stuck with the archaic, centralized models of water and energy supply that, unless we start changing it fast, will likely spell California's doom?
I know: simple questions. Simplistic, even. But as we get more desperate, we sure as hell don't seem to have very many satisfying answers.
I remember attending a wedding a few years back in Tucson, Arizona, smack in the middle of August (not recommended, by the way, unless you love the feeling of a merciless sun hunting for openings on your body to give you melanoma) and being absolutely dumbfounded, as I stood on the hotel's roof and looked out over the clusters of million-dollar homes sunk into the desert sand, why the hell I wasn't seeing a basic solar collector on every single rooftop.
A simply insane amount of heat energy pounding down on every square inch of that blistering state almost year-round, and not a single law requiring that homes capture a single watt of it to support their cranked air conditioners? What the hell is wrong with us?
The answers to all these admittedly crude queries are, of course, as enormous and messy as they are increasingly, face-poundingly imperative. They involve everything from the current state of green technology to how we are set up as a society, to lack of education, climate change regulations, government inaction, cultural entitlement, and plain old American laziness.
The bad news is, we are far behind where we should be. The good news is, it's not too late. Check that: it very well might be. But who wants to think like that?
As for our state's water woes, the misanthrope in you can easily argue that California is just stupidly overpopulated, that we use and abuse far more natural resources than we can possibly sustain, and hence ridiculous places like Los Angeles, 10 million people living in a semi-arid desert with zero individual water or solar reclamation, are not long for this world.
But that's not entirely fair. Because, like many other states, only a fraction of California's supply of fresh water actually goes to human use, including business and industrial. The rest goes to farmers. Who use most of it to grow grain. To feed cattle. To raise industrialized beef. To supply fast-food chains with chemically blasted meat, of which our wildly obese nation still consumes far, far too much.
In short: Want to help fix the water crisis in California? Eat better. And shut down Taco Bell.
The list goes on. Entitlement plays a big role, as we have, just about forever, had painless access to all the cheap energy and fresh water we could possibly use, with almost zero incentive to give a damn about conservation or personal responsibility, much less how to install a gray water reclamation system in your condo.
The federal government? Nearly useless. Ten years of BushCo meant 10 years of leaders who simply didn't give a damn about doing anything but reinforcing the absolute worst of our gluttonous habits: more oil, more coal, more dams, more mining, more abuse. Not only did they fail to encourage a rethinking of our rapacious ways, they forcibly restrained and killed projects and progress, making the U.S. a pathetic example for the world. With Obama, that's finally changing, and not a moment too soon.
The eco movement is doing its part. The technology is now evolving rapidly and becoming more affordable at scale, green homes are catching on and simple systems for everything from solar rooftops to gray water to compost toilets are readily available for the conscious DIYer (though mainstream awareness and access are still a long way off).
So maybe it's safe to suggest that there really is no energy shortage. There is not much of a water shortage. There is only our inability to capture it wisely, to be more aware, to prize energy and water like gifts to be carefully managed, instead of wantonly wasted.
Ah, but note how easily the devil co-opts your fine and fainthearted notions. Note how Big Oil uses this same argument to keep right on raping the planet at will.
Witness, won't you, the sickening reality of the Alberta oil sands, miles and miles of formerly pristine Canadian forest now being ripped open and raped filthy by Big Oil via some of the most toxic and environmentally destructive mining techniques imaginable. See? There is no oil crisis! We have plenty of petroleum! Pay no heed to our reeking wasteland dotted with enormous sludge pools that will poison the region for thousands of years. We made oil! Let's go for a drive!
How do you parse it all? Where can you direct your attention, and your concern? Truly, there are far too many angles, too many issues and human dramas involved in all this to address in a short space like this. Bringing up water issues in California is a bit like mentioning porn to a roomful of feminists. Just slightly, how do you say, loaded.
But as I look out the window right now and watch the rain hammer down, some basic, individual steps certainly seem obvious as hell. I'd still like to take a nice, hot shower. Someone get me a bucket.
Contra Costa Times
Federal funds heading to local law enforcement...Karl Fischer, West County Times
The recently passed American Recovery and Reinvestment Act will provide $2.1 million in funding for Contra Costa and Solano County law enforcement, U.S. Rep. George Miller, D-Martinez, announced.
The act includes more than $4 billion for state and local law enforcement. The local funding, administered as grants through the federal Office of Justice Programs, can be used for a wide variety of purposes, from equipment to crime prevention to paying for personnel, according to a release from Miller's office.
Local beneficiaries include Richmond, Vallejo, Contra Costa County, Concord, San Pablo, Vacaville, Pittsburg, Solano County, Pinole, Martinez, Benicia and Hercules.
Obama kills controversial nuclear program in budget proposal...Suzanne Bohan
President Barack Obama's fiscal year 2010 budget proposal calls for an end to the Reliable Replacement Warhead program, a controversial project involving scientists at Lawrence Livermore Laboratory that supporters said was essential for maintaining the reliability of the country's nuclear arsenal.
"(The program) is for all intents and purposes dead," said Daryl Kimball, executive director of the Arms Control Association in Washington, D.C.
The Obama administration's proposed budget requests $26.3 billion for the Department of Energy, which oversees the nation's stockpile of about 9,000 nuclear weapons. But the administration's budget outline, released last week, called for the official cessation of development work on the reliable warhead program, and a sole focus on improving the safety, security and reliability of the current nuclear stockpile.
Many of those weapons were manufactured in the 1970s and 1980s, and the Bush administration in 2005 began a program to replace them with simpler, modernized bombs that it said would also be easier to secure. From fiscal years 2005 to 2007, the program received $70 million for design work, but in fiscal years 2008 and 2009, Congress declined to fund it further.
The 32 lab workers assigned to the program were transferred to other projects after funding ended, according the public affairs office with the National Nuclear Security Administration in Washington, D.C., an energy department agency tasked with managing the nation's nuclear stockpile.
Supporters of the reliable warhead program said it would allay anxiety among some nuclear scientists that certain older weapons might not perform as expected, undermining the stockpile's ability to serve as a credible nuclear deterrent.
But opponents of the program pointed to a 2006 scientific panel's conclusion that the existing stockpile is good for at least an additional 85 years, and Sen. Dianne Feinstein, D-Calif., stated that developing new warheads to replace the old discredits attempts to stop the spread of nuclear weapons among other nations, and would waste billions of dollars.
But that 2006 report only assessed the performance of plutonium pits — the fissile material at the core of the bombs, according to the nuclear security administration's public affairs office.
"However, pits are just one element in a warhead," stated an agency representative.
Stating the existing stockpile is "safe, secure and reliable," an agency representative added that "nuclear weapons are very complex systems, and require frequent maintenance and evaluation."
Los Angeles Times
Senate blocks effort to derail endangered species protections...Catherine Ho...Greenspace
Alaskan senators' effort to block a Democratic push to undo a Bush-era weakening of the Endangered Species Act failed in the Senate on Thursday.
On Tuesday, President Obama restored some of the protections for endangered species that the Bush administration stripped in December, requiring that federal agencies consult with experts before starting construction projects that could threaten endangered species. Before the Bush rule change, federal agencies had been required for 30 years to consult with biologists first.
Tuesday's move was made in a provision to the fiscal 2009 omnibus spending bill that would allow the White House to withdraw two Bush-era Endangered Species Act rules within 60 days without going through a public comment period. The rules in question: one that scaled back safeguards for endangered species and another that limited protections for the polar bear specifically.
Alaska Sens. Lisa Murkowski (R) and Mark Begich (D) proposed an amendment specifying that if the current administration were to pull the rules, the action would be subject to the 60-day period. That amendment was voted down in the Senate on Thursday, 52 to 42.
"By rejecting Sen. Murkowski's amendment to undermine protection for polar bears and other threatened and endangered species, the Senate capped off a good week for protecting our endangered wildlife," said Rodger Schlickeisen, president of Defenders of Wildlife, a conservation group.
Begich said in a previous statement that removing the standard 60-day period "allows the secretaries to make dramatic changes in rules and regulations without having to comply with multiple, long-standing federal laws that require public notice and public comment by the American people and knowledgeable scientists."
Obama upholds Bush decision to delist gray wolf
Interior Secretary Ken Salazar says the previous finding that the animal is no longer endangered in the Upper Midwest, Idaho and Montana is valid. He agrees the wolf remains threatened in Wyoming...Jim Tankersley
Reporting from washington — After reversing President Bush on a pack of environmental rules in its first month, the Obama administration let one of Bush's last-minute changes stand today: Removal of the gray wolf from the endangered species list in the Upper Midwest, Idaho and Montana.
Interior Secretary Ken Salazar announced the decision in a noon news conference, saying the finding by the Fish and Wildlife Service under Bush was "a supportable one. . . . Scientists have concluded that recovery has occurred."
He also agreed with the Bush administration's decision to keep the wolf on the endangered species list in Wyoming, calling that state's wolf recovery plan insufficient.
Salazar praised efforts by Idaho and Montana to restore and manage wolf populations and said, "I do not believe we should hold those states hostage to the inadequacy we've seen in Wyoming."
The delisting of the gray wolf was the latest chapter in an ongoing battle between the federal government and environmental groups, which successfully sued to keep the animal on the endangered list.
Bush's Interior Department announced the delisting in the final days of his term, and it wasn't finalized by the time Obama took office and froze all pending rule changes.
Salazar's announcement today almost assuredly means environmentalists will sue again to keep the wolf under federal protection, continuing the saga of an animal that rouses fierce debate among ranchers and conservationists in the West.
Wolves once roamed most of the nation but dwindled to near-extinction before the Clinton administration reintroduced them in Yellowstone National Park in the 1990s. Populations grew quickly enough that a decade after reintroduction, Bush officials tried to remove the wolf from the endangered list, only to be blocked by courts.
The announcement by Salazar, who grew up on a ranch in rural Colorado, came after a string of Obama administration moves to freeze or roll back Bush-era environmental decisions. The Interior Department alone has slowed efforts to increase oil and gas development offshore and in Rocky Mountain shale.
On Tuesday, Obama marked the department's 160th anniversary by announcing he was overruling a Bush decision to allow federal agencies to determine on their own whether construction projects would harm endangered species. Obama restored the practice of forcing all agencies to consult with expert biologists about potential impacts to protected plants or wildlife.
A clash over auto emission standards
California wants its own limits, saying carmakers can hit the mark. Others support a national standard...Jim Tankersley and Ken Bensinger
Reporting from Los Angeles and Arlington, Va. — California officials told the Environmental Protection Agency on Thursday that major automakers are already on track to meet the state's strict proposed limits on greenhouse gas emissions from vehicles.
But they clashed again with auto industry supporters at a daylong hearing over whether the EPA should grant California's request to allow it and 13 other states to set their own emission standards.
Automakers and dealers raised concerns over several points of California's plan and said they would welcome a nationwide standard for emission limits. California officials said they wouldn't accept any national standard that fell short of their state's.
Listening to the arguments was the Obama administration, which has expressed strong interest in crafting a national emission standard that satisfies the recession-rocked domestic auto industry and California.
The Clean Air Act allows California to seek permission to set its own air pollution standards, which the state did by passing the nation's first law regulating greenhouse gas emissions from vehicle tailpipes earlier this decade.
The state has been unable to implement the regulation because of a series of legal challenges from the auto industry and a decision by the Bush administration in late 2007 denying the state's request for a required EPA waiver.
A week into his term, President Obama ordered the EPA to reconsider that move. The EPA scheduled a hearing Thursday at its office in Arlington, Va., to solicit public comments on California's request.
California officials emphasized the dangers a warming climate poses to the state's air quality, water supply and agriculture.
"As the temperature gets hotter, many places in California become increasingly difficult places to live," said state Sen. Fran Pavley (D-Agoura Hills), the original author of California's tailpipe emission standards.
State officials also said they believed General Motors Corp. would meet their standards for this model year and 2010. Their opinion was based on information from the troubled automaker's recovery plan filed with the Obama administration this year.
"The technology is ready" to make more efficient cars and trucks, said Tom Cackette, the deputy executive officer of the California Air Resources Board. "The manufacturers are exceeding our expectations."
But Sen. Carl Levin (D-Mich.), who has been a supporter of automakers, said California's regulations would handicap the industry.
"Global warming is not unique to California," he said. "And to suggest that it is actually undermines the argument that it is a global threat that knows no boundaries."
Levin and industry representatives argued for emission controls on a national level, rather than on the state level. They noted the sagging economy's effect on auto sales and said granting the California request would force automakers to comply with different standards in different states.
GM has argued against the state-by-state approach in the past. But as the troubled automaker waits for the White House to decide whether to give it $16.6 billion in additional bailout funding, the company has taken a quieter role in the debate.
The company did not speak directly at the hearing and has been reserved in its criticism of California's proposed rule.
Deciding how to regulate emissions is "a process that we plan to be engaged in," said GM spokesman Greg Martin. "We continue to work vigorously on the new technologies and cars that will offer meaningful solutions to the nation's energy crisis."
California officials said although they would not accept a national standard lower than their state's, they too would ultimately like U.S. auto emission regulations under one policy, as is the case in the European Union and Japan.
"Our hope is that there would be a federal [standard] that we could sign onto and support," said Mary Nichols, chairwoman of the Air Resources Board. "That would be the best for the world."
State's proposed emissions rule sparks firestorm
The new standard would gauge a fuel's 'carbon intensity,' from its source to its burning...Margot Roosevelt
California regulators Thursday issued a far-reaching proposal to slash carbon emissions from transportation fuels, setting the stage for a national battle over how to reduce the damage to the global climate from gasoline and diesel combustion.
The low-carbon fuel standard, if approved next month by the state's Air Resources Board, would be the first in the nation to restrict greenhouse gases produced by a fuel, from its source to its burning.
Eleven states are considering similar rules, and President Obama has called for a national low-carbon fuel standard as part of his initiative to cut U.S. greenhouse gas emissions by 80% by mid-century.
Air board chairwoman Mary Nichols said the proposed rule was a "comprehensive, cradle-to-grave approach" that would spur innovation and competition in the alternative fuels market.
But some members of California's beleaguered renewable-fuels industry greeted the initiative with outrage. Tom Koehler, spokesman for Pacific Ethanol, said the proposal was "a perversion of science and a prescription for disaster."
California is the first state to pass a comprehensive law to restrict carbon dioxide and other emissions across its economy. Transportation accounts for one-third of the nation's greenhouse gas releases. Scientists say the emissions are trapping heat in the Earth's atmosphere and changing its climate, which will cause droughts, floods, water shortages and species extinctions.
The fuel standard is a key element in the state’s climate plan, along with an initiative to regulate the engines and bodies of vehicles for carbon emissions. That proposal is under review by the federal Environmental Protection Agency.
The fuel proposal announced Thursday is projected to reduce carbon emissions by 16 million metric tons by 2020. It would result in the replacement of 20% of the fossil fuel used by California cars with cleaner alternatives by 2020, including electricity, biofuels, hydrogen and other options, the board said.
By forcing refineries, producers and importers to reduce the "carbon intensity" of their fuel by 10% by 2020, and by increasing percentages after that, the air board is taking a far different approach from the Renewable Fuels Standard that President Bush pushed through Congress in 2007.
That law required that 36 billion gallons of biofuels be sold by 2022, of which 15 billion could be ethanol derived from corn. That rule, said Daniel Sperling, an air board member and a UC Davis transportation fuel expert, spurred "a massive expansion of corn ethanol."
The corn from which ethanol is derived requires large amounts of water and petroleum-based fertilizer to produce and, according to some studies, diverts land from pastures and rain forests, which store carbon. The result is increased carbon in the atmosphere.
In its proposal, the air board seeks to quantify these so-called "indirect land use changes," a calculation that effectively assigns a high carbon intensity to corn-based ethanol in relation to other fuels.
That decision has touched off a furious debate among scientists, some of them industry-supported and others with environmental affiliations. A letter criticizing the air board's methods, released by the New Fuels Alliance, an ethanol industry group, was signed by 111 scientists, including researchers at Sandia National Laboratories and Lawrence Berkeley National Laboratories.
Several missives supporting the air board's approach were signed by leading California energy academics, including UC Berkeley's Daniel Kammen and Michael O'Hare.
The push for ethanol as an alternative to imported oil spurred the construction of 172 plants in 25 states by the end of 2008. But in recent months falling oil prices has made ethanol less cost effective. More than 20 plants have closed, including five in California.
"The proposed regulation will do nothing to start them back up," said Gary Meltz of the fuels alliance. "It would be devastating nationally because . . . as goes California, so goes the nation on many environmental standards and regulations."
But environmentalists praised the rule as the only fair approach. "It's a complicated issue, but the basic principle is simple," said Patricia Monahan, a vehicles expert at the Union of Concerned Scientists. "Set a performance standard, let fuels compete in the marketplace to meet the standard, and keep politics from distorting the science. It's about reducing carbon, not picking winners or losers."
Unemployment hits 25-year high
Jobless rate hits 8.1% in February as a record-high 12.5 million people are unemployed...Chris Isidore
NEW YORK (CNNMoney.com) -- The U.S. economy continued to hemorrhage jobs in February, bringing total job losses over the last six months to more than 3.3 million, and taking the unemployment rate to its highest level in 25 years.
The government reported Friday that employers slashed 651,000 jobs in February, down from a revised loss of 655,000 jobs in January. December's loss was also revised higher to a loss of 681,000 jobs, a 59-year high for losses in one month.
Economists surveyed by Briefing.com had forecast a loss of 650,000 jobs in February.
"The economy is headed south with a vengeance," said Kurt Karl, head of economic research for the U.S. unit of insurer Swiss Re.
The unemployment rate rose to 8.1% from 7.6% in January. It was the highest reading since December 1983 and higher than economists' projections of 7.9%.
Most workers who have jobs today are not old enough to have worked in a labor market this bad, while 13% of workers weren't even alive the last time unemployment was at this level.
The survey of households found 12.5 million people are now unemployed, the most since records started being kept in 1940.
The U.S. economy has now lost 4.4 million jobs since the start of 2008. To put that in perspective, that's about equal to the total number of jobs in each of the following states -- Georgia, Michigan and North Carolina -- at the end of 2007.
"It's a dismal report. We thought we'd have another month like this, and I think we have a couple of more coming," said Tig Gilliam, chief executive of Adecco Group North America, a unit of the world's largest employment firm. "We've got a lot of layoffs being announced that haven't been implemented."
Gilliam said he expects the unemployment rate to rise to 9% within the next few months.
Other economists echoed Gilliam's view that the battered labor market has yet to hit bottom. John Silvia, chief economist at Wachovia, pointed to the weekly initial jobless claims, which are still above 600,000 a week, and the large increase in the number of people working part time when they'd prefer full-time work as signs of more job losses to come.
"I'd love to believe this is the worst, but I suspect we'll continue to lose jobs for months to come," he said. "All we can hope is that the pace would slow down."
The Obama administration issued a statement saying that the jobs report and overall economic problems are the reasons why it moved quickly to get an economic stimulus package passed by Congress last month.
"There's no doubt that we have a long way to go to get this economy moving again, and the jobs numbers are one more reminder of that," White House Press Secretary Robert Gibbs told reporters aboard Air Force One.
But some economists questioned whether the stimulus package will be able to do much to address job losses in the near term.
"The stimulus won't have immediate effect on job creation even though some planned layoffs could be cancelled," said Sung Won Sohn, economics professor at Cal State University Channel Islands. He said most of the job growth that the $787 billion in government spending will create won't be seen until 2010.
Underemployment rate keeps rising as well
The number of workers with part-time jobs who either can't find full-time positions or have had their hours cut jumped by 787,000 in February to 8.6 million.
Counting those part-time workers, along with discouraged job seekers no longer counted as unemployed by the government, the so-called underemployment rate hit 14.8% in February, up from 13.9% in January. This was the fifth straight record high for that reading, which has been calculated since 1994.
Silvia said the cut in total hours worked and the jump in those now working only part-time are both signs that the overall economy will continue to slow.
He said many people with part-time jobs are not earning enough to pay their bills. That will probably lead to more cuts in consumer spending, which in turn will lead to more drops in revenue for businesses and more layoffs.
The job losses were widespread, with manufacturing and construction companies, as well as business and professional services firms all losing more than 100,000 workers.
The report also showed that businesses in more three-quarters of the sectors in the economy reduced the number of jobs in the last month. Over the last three months, 83.2% percent of industries have lost workers, a record high for that reading.
"What started in construction and manufacturing and financial services has spread to every industry," said Gilliam.
Washington prepares for big bank failure
A bill introduced in the Senate would give FDIC chief, Sheila Bair, a huge loan to handle 'emergency situations' in the banking sector...Colin Barr
NEW YORK (Fortune) -- The government is bracing for a big bank failure.
A bill introduced in Congress would give the FDIC, the agency that stands behind Americans' bank deposits, temporary authority to borrow as much as $500 billion from the government to shore up the deposit insurance fund.
The bill -- the Depositor Protection Act of 2009, backed by Senate Banking Committee Chairman Chris Dodd, D-Conn. and Sen. Mike Crapo, R-Idaho -- wouldn't change the status of individual bank accounts, which through the end of this year are insured up to $250,000.
But the Dodd-Crapo bill acknowledges what the financial markets have been signaling for the past month -- that the government must take the lead in a costly cleanup of the mess in the financial sector.
"I think it's a commendable start," said Simon Johnson, a former International Monetary Fund chief economist who tracks the crisis on his BaselineScenario.com blog.
Dodd said he introduced the legislation at the behest of other regulators, notably Federal Deposit Insurance Corp. chief Sheila Bair, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Tim Geithner. All three recently wrote Dodd to support an emergency expansion of the FDIC's capacity to borrow from the Treasury.
"This mechanism would allow the FDIC to respond expeditiously to emergency situations that may involve substantial risk to the financial system," Bernanke wrote in a Feb. 2 letter to Dodd.
The Senate bill is being introduced at a time of rising market stress about the health of the banking industry. Sixteen relatively small banks have already failed this year and 25 went under in 2008. Last year's failures included the July demise of mortgage lender IndyMac and the September collapse of Washington Mutual, which was the sixth-biggest depository institution in the nation at the time it failed.
Shares of Citigroup (C, Fortune 500), the giant financial company that last week received a third round of government aid, have fallen 58% since the government outlined a plan to convert the bank's preferred shares to common stock. The stock even dropped below $1 Thursday.
The Citi plan aimed to ease market concerns about the bank's health. But fears have only increased, judging by the swoon in financial stocks this week and the sharp rise in the cost of protecting financial-sector debt against default.
Fear of a big collapse continues to rise
The Credit Derivatives Research counterparty risk index -- a measure of the annual cost of insuring the bonds of 14 global financial companies against default -- surged nearly 30% this week as investors rushed to protect themselves against possible defaults at giant institutions.
It now costs an average of $289,000 per year to buy insurance on $10 million's worth of bank debt, according to the CDR index. That's just shy of the $300,000 average premium in force the day the index hit its all time high -- Sept. 17, 2008.
That was the day after the government's $85 billion first bailout of AIG (AIG, Fortune 500), two days after the failure of broker-dealer Lehman Brothers and a week before WaMu was seized by regulators.
The current degree of stress in the financial sector is "totally shocking," said Johnson, given the massive resources governments around the globe have devoted to reducing fears of a major collapse.
The financial fears point to the need for the Obama administration to produce a detailed plan of how it will deal with troubled too-big-to-fail institutions and bad assets in the banking sector, said Johnson, who teaches in the business school at MIT.
"If you don't do a systemic plan fast, you set up a target for speculators," said Johnson.
The market's reaction to Geithner's failure to produce an adequately articulated proposal as promised on Feb. 10 stands as a cautionary tale. The Dow Jones Industrial Average has dropped 20% since then.
FDIC may need to hit Congressional ATM
The insurance that the FDIC provides to bank depositors is funded by annual assessments on banks. But the fund has been depleted by a sharp rise in bank failures over the past year, and efforts to raise the fees that support the deposit fund have been complicated by the poor health of the banking industry.
The deposit fund's balance fell 64% in 2008 to $19 billion, putting deposit fund assets at just 0.4% of banking industry assets. That's barely a third of the 1.15% statutory minimum.
Despite the welcome signs that policymakers are coming to grips with the extent of the U.S. banking crisis, observers say officials have yet to make clear that they fully grasp the scope of the financial industry's problems.
A $500 billion loan to the FDIC "begins to approximate the maximum loss from resolving the top four banks," said Chris Whalen, a managing director at Institutional Risk Analytics, a financial research and hedge fund advice firm.
The five biggest U.S. bank holding companies - Bank of America (BAC, Fortune 500), Citi, JPMorgan Chase (JPM, Fortune 500), Wells Fargo and Wachovia, which is now owned by Wells - had domestic deposits of between $271 billion and $701 billion at the end of the second quarter of 2008, according to the most recent data available from the FDIC.
With credit costs, which reflect expenses tied to bad mortgage and credit card loans, on the way to doubling the levels reached in the 1991 recession, Whalen expects the cost of fixing troubled banks to hit $1 trillion.
Whalen adds that he believes regulators may have to swing into action in coming weeks. With bad loans rising sharply even at the better managed banks, the next round of financial reports from the most troubled banks, due out in April, could be truly horrific.
"Does anybody really want to see Citi's first-quarter numbers?" Whalen said.