Olympia Business Watch

Brunell: There are better, less costly ways to reduce greenhouse gases

Jason Hagey — Fri, 10 Jul 2009 16:03:01 -0700

The AWB opposes cap-and-trade legislation, but supports a stronger, cleaner energy future, AWB President Don Brunell writes in his weekly column.

Wind energy, hydro-electric systems, clean coal and other fossil fuels all are needed, Brunell writes.

Now is the time for another look at nuclear energy, too, he says. France gets 80 percent of its electricity from nuclear power, which continues to make stead progress in plant safety and in reprocessing spent fuel rods.

"Like hydro, nuclear energy produces no carbon dioxide," Brunell writes.

Opponents of cap-and-trade are not taking a "do nothing" position on the environment, he says. They just want to make sure Congress does not ignore the costs that are associated with protecting the environment.

EPA administrator admits cap-and-trade won't help if U.S. acts alone

Jason Hagey — Fri, 10 Jul 2009 11:15:42 -0700

EPA Administrator Lisa Jackson confirmed an analysis from her agency Tuesday that shows any effort the U.S. undertakes to reduce greenhouse gas emissions will have no effect on the climate unless other countries also join in.

Her comment came as the U.S. Senate picks up the debate on controversial cap-and-trade legislation that won narrow approval last month in the House of Representatives.

As if on cue, the next day China, India and other developing countries refused to accept mandatory emissions controls that the Group of 8 nations, gathered in Italy for talks dominated by climate change, hoped they would agree to.

There may be a lesson here for Washington state officials, who have pondered either a state or regional cap-and-trade system.

U.S. Sen. James Inhofe, R-Okla., the ranking Republican on the Senate and Environment and Public Works Committee, predicted that the failure of developing nations to join with the U.S. in reducing greenhouse gas emissions would doom the Waxman-Markey bill, the cap-and-trade legislation passed by the House.

"Unless supporters of cap-and-trade legislation can develop a plan to convince China and India to make meaningful emissions reductions on par with the United States, no such bill will pass the U.S. Senate," Inhofe said in a statement.

Then on Thursday, Sen. Barbara Boxer, D-Calif., chairwoman of the Senate committee, told reporters that the committee would not finish writing a bill before the August recess, as she had hoped, but would tackle it instead in September.

Boxer said the delay would not jeopardize getting a bill through the Senate this year, according to the Washington Post, but she would not guarantee delivering a bill to President Obama by December when he plans to attend an international summit on climate change in Copenhagen.

If the EPA doesn't believe the U.S. can by itself impact the world climate through regulation, there is no reason to believe Washington state or the Western U.S. can go it alone either.

Regardless of whether Congress delivers a climate-change bill to the president this year, or whether China, India and other developing countries go along with the G8 nations, Washington businesses are reducing emissions as technology improves.

As one example, TransAlta is taking waste from its coal-fired power plant near Centralia and sending it to Tacoma where it is processed into synthetic gypsum used in "green" wallboard.

Businesses will continue reducing waste and emissions as technology advances - as long as they aren't put out of business by ineffectual regulations.

Boeing purchase a 'wake-up call' for Washington business

Jason Hagey — Tue, 07 Jul 2009 13:44:04 -0700

Today's announcement from Boeing that it is buying a South Carolina production plant that produces sections of the 787 rear fuselage triggered immediate, unequivocal responses from some of the state's business leaders: It is time to make a compelling case for Washington.

Despite a statement from Gov. Chris Gregoire saying that Boeing has not made any decisions about a possible second 787 production line, the group is concerned that labor dispute and other factors could lead the company to look to South Carolina to do just that.

In a statement released this morning, Washington Roundtable President Steve Mullin said such a move would be a "devastating blow" to the Washington state economy. The press release summarized the reaction from several business leaders.

“This is our wake-up call," added AWB President Don Brunell. "In this economic climate, businesses must locate where they have the best chance for success. If staying in Washington makes Boeing less competitive, it has to look at other options. Boeing must deliver value to their customers by delivering products cost-effectively and on time. That means Boeing cannot have frequent strikes and labor discord.”

There Seems to Be More Behind the Story About Cap and Trade

Don Brunell — Sun, 05 Jul 2009 22:49:16 -0700

In today's The Columbian, there was an editorial by Jay Ambrose which started: "The recently passed House bill on global warming is a 1,500-page political sucker punch that could give family finances a bloody nose and ultimately flatten the economy while proponents pretend it will save the planet. In and of itself, it won't do an inch of good." Ambrose was referring to the close vote in the U.S. House of Representatives on June 26 (219-212) where the cap and trade bill narrowly made it out of the House.

The disturbing thing about the express train that zipped the bill through the House that night was too many members of the House admitted they did not read the bill.

Then out comes a commentary by Kimberly Strassel in the Wall Street Journal which if true is a very sad commentary on freedom of speech and expressing points of view which are contrary to what is in vogue. Here is what she wrote:

Wherever Jim Hansen is right now -- whatever speech the "censored" NASA scientist is giving -- perhaps he'll find time to mention the plight of Alan Carlin. Though don't count on it.

Mr. Hansen, as everyone in this solar system knows, is the director of NASA's Goddard Institute for Space Studies. Starting in 2004, he launched a campaign against the Bush administration, claiming it was censoring his global-warming thoughts and fiddling with the science. It was all a bit of a hoot, given Mr. Hansen was already a world-famous devotee of the theory of man-made global warming, a reputation earned with some 1,400 speeches he'd given, many while working for Mr. Bush. But it gave Democrats a fun talking point, one the Obama team later picked up.

Ken Fallin

Alan Carlin, 35-year Environmental Protection Agency veteran

So much so that one of President Barack Obama's first acts was a memo to agencies demanding new transparency in government, and science. The nominee to head the Environmental Protection Agency (EPA), Lisa Jackson, joined in, exclaiming, "As administrator, I will ensure EPA's efforts to address the environmental crises of today are rooted in three fundamental values: science-based policies and program, adherence to the rule of law, and overwhelming transparency." In case anyone missed the point, Mr. Obama took another shot at his predecessors in April, vowing that "the days of science taking a backseat to ideology are over."

Except, that is, when it comes to Mr. Carlin, a senior analyst in the EPA's National Center for Environmental Economics and a 35-year veteran of the agency. In March, the Obama EPA prepared to engage the global-warming debate in an astounding new way, by issuing an "endangerment" finding on carbon. It establishes that carbon is a pollutant, and thereby gives the EPA the authority to regulate it -- even if Congress doesn't act.

Around this time, Mr. Carlin and a colleague presented a 98-page analysis arguing the agency should take another look, as the science behind man-made global warming is inconclusive at best. The analysis noted that global temperatures were on a downward trend. It pointed out problems with climate models. It highlighted new research that contradicts apocalyptic scenarios. "We believe our concerns and reservations are sufficiently important to warrant a serious review of the science by EPA," the report read.

The response to Mr. Carlin was an email from his boss, Al McGartland, forbidding him from "any direct communication" with anyone outside of his office with regard to his analysis. When Mr. Carlin tried again to disseminate his analysis, Mr. McGartland decreed: "The administrator and the administration have decided to move forward on endangerment, and your comments do not help the legal or policy case for this decision. . . . I can only see one impact of your comments given where we are in the process, and that would be a very negative impact on our office." (Emphasis added.)

Say it ain't true, Mr. President?

Don C. Brunell, President (DonB@awb.org)

Mixed News from Pendleton

Don Brunell — Sat, 04 Jul 2009 07:47:29 -0700

There is mixed news out of Pendleton Woolen Mills. Its Washougal operations will have more employees, but the company overall is laying off people, there are wage reductions, and there are job losses at its Pendleton, OR, operations. The big reason (and lingering problem) is our slow economy.

Pendleton is one of the Association of Washington Business' oldest members. Charlie Bishop, a family member who runs the Washougal mill, has been an AWB Board member and in 2004, AWB commissioned Pendleton to weave its 100th Anniversary commemorative blanket. It was designed by AWB Sr. Vice President Debra Brown and it is from the pattern of the company's famed national park series.

Here is the story from The Columbian:

Pendleton Woolen Mills, which operates a mill employing 182 in Washougal, is reorganizing its production profile and cutting its work force in the face of continued weak markets.

The Portland-based company, famed for its colorful woven blankets, rich woolen fabrics and clothing, is cutting costs, laying off 43 workers and moving its yarn-making operation from Pendleton, Ore. to Washougal, company officials said.

Many of the permanent layoffs will come at the 100-year-old company's mill in Pendleton. The company also announced pay cuts for all employees earning more than $50,000 a year, although it did not say how large the cuts would be.

The company employs 900 people nationwide, most of them in Washington and Oregon.

"The prolonged decline in consumer spending has affected all of our channels, including retail, catalog and wholesale," President Mort Bishop III told the Associated Press on Wednesday. "As a result of that, we are forced to look at reducing expenses, streamlining our organization and eliminating redundancies and duplication."

Woolen mills have practically vanished across the United States, but Pendleton has managed to survive. It has crafted commemorative blankets for national parks, furnished blankets for athletes in the Olympics and given one to every president since Warren Harding.

On this 4th of July, President Obama and Congress need to FIX THE ECONOMY FIRST. Manufacturers like Pendleton are the back bone of America. Without business and working families, there is No American Economy or taxes to pay for all of this new federal spending.

Don C. Brunell, President (DonB@awb.org)

Arnold is Horrified: The State's Coffers are Empty, California Pays With I.O.U.’s

Don Brunell — Fri, 03 Jul 2009 13:49:55 -0700

No wonder Gov. Arnold Schwarzenegger (R) is horrified as shown in this New York Time photo in this morning's edition. You would too if you had to wake up to the financial mess he is greeted with each morning.

According to the New York Times: "An ever-widening budget gap joined with intractable political paralysis to deliver California its biggest fiscal blow in decades on Thursday, when the state’s controller began printing i.o.u.’s in lieu of cash to pay taxpayers, vendors and local governments.

It was only the second time the state had adopted the emergency payment method since the Great Depression. The National Conference of State Legislatures had no record of any other state’s ever using them.

It was unclear whether the i.o.u.’s, known as warrants, would be accepted by all of the banks in California, which were caught off guard by the move and seemed hesitant to entrust the state to repay the them — at an interest rate of 3.75 percent — in October, as promised.

The controller, John Chiang, issued 28,742 warrants totaling $53.3 million. If state lawmakers fail to reach a budget agreement by the end of August, the amount would grow to $4.8 billion.

While the emergency move resulted from California’s combination of outsized budget gaps, unusual budget rules and a morass of financial obligations approved at the polls, the action was seen as a warning flag to other states that have failed to close their budgets this fiscal year because of the economic downturn."

Let's not follow California down this RED BRICK ROAD. Issuing the warrants is the easy part. Paying for them is much more difficult. See Richard Davis' column in today's Puget Sound Business Journal.

Don C. Brunell, President (DonB@awb.org)

Fix the Economy First

Don Brunell — Fri, 03 Jul 2009 13:23:13 -0700

President Obama and Congress need to pay attention to today's lead story in the New York Times. It is proof they should fix the economy first and then deal with costly new cap and trade and health care reforms.

Not that reducing greenhouse gases or providing less costly health care and insurance isn't a priority, but unless we get people back to work, focus on economic recovery and figure out how we are going to pay for all of these new federal government initiatives since the President took the oath of office, we may find ourselves in even a deeper recession.

On the unemployment front, the nation's jobless rate rose again. The lead paragraph in the Times today said it all: The American economy lost 467,000 more jobs in June, and the unemployment rate edged up to 9.5 percent in a sobering indication that the longest recession since the 1930s had yet to release its hold. The losses for June lifted net jobs shed since the beginning of the recession to 6.5 million — equal to the net job gain over the previous nine years.

“This is the only recession since the Great Depression to wipe out all jobs growth from the previous business cycle,” Heidi Shierholz, an economist at the labor-oriented Economic Policy Institute in Washington, said in a research note. She called this fact “a devastating benchmark for the workers of this country and a testament to both the enormity of the current crisis and to the extreme weakness of jobs growth from 2000 to 2007.”

In Washington State the unemployment rate in May rose to 9.4 percent. In some areas, like the Vancouver-Portland metro area, the jobless rate is over 12 percent.

FIX THE ECONOMY FIRST, PUT PEOPLE BACK TO WORK AND DO THE MATH ON THIS NEW SPENDING FOR NEW PROGRAMS IS GOING TO COST US TAXPAYERS.

Don C. Brunell, President (DonB@awb.org)

Judge halts state plan that threatens caregivers who aid family members

Jason Hagey — Thu, 02 Jul 2009 14:56:34 -0700

A federal judge has issued a temporary restraining order stopping Washington state officials from implementing a new law that would require people who care for developmentally disabled family members to quit working through licensed agencies and become independent providers.

U.S. District Court Judge Benjamin Settle issued the order Wednesday afternoon as part of a lawsuit seeking to block implementation of Substitute House Bill 2361. The legislation, approved by lawmakers this spring, will hurt care givers, force some home care agencies out of business, and expose people with disabilities to increased risks to their health and safety.

Several home care agencies, care givers and beneficiaries filed the lawsuit Monday against Gov. Chris Gregoire and state Department of Social and Health Services Secretary Susan Dreyfus.

The ruling gave a temporary reprieve for care givers, who were faced with a choice to turn over care of their loved one to someone else, or quit working for a home care agency -- and give up access to additional support services that come as a result.

In many of these situations there is no choice - the only person capable of providing the kind of care required is a family member. “Personal care,” as it’s called by officials, means just that: Personal. Toileting. Bathing. Dressing.

DSHS was planning to implement the law beginning July 1.

Nearly 100 people packed the court room Tuesday in U.S. District Court in Tacoma to witness the hearing, said Jenny Eigner, owner of Kemper Services, Inc. Eigner is not a plaintiff in the case, but some of her employees are.

“It was incredible,” Eigner said.

The stakes are high for all involved.

For the home care providers, the law would mean taking a 35 to 45 percent pay cut, losing medical insurance for dependants, and joining the Service Employees International Union or paying union dues.

In court papers, attorneys from the Seattle law firm Bennett Bigelow & Leedom note one case where the loss of insurance would be devastating: A man who receives health care coverage as a dependent of his spouse – the home care provider – who was recently diagnosed with a blood disorder.

For the developmentally disabled population who count on their care givers, the law poses serious risks to their health and safety.

That’s because home care agencies provide a significant amount of services beyond the level provided by independent providers, including additional training and access to staff members who supervise the quality of care.

The court papers cite numerous examples of seriously disabled adults and children who rely on care from a family member employed through a home care agency.

“For some, the agencies play an essential role in providing backup care that otherwise would be difficult to obtain or unavailable in rural areas,” plaintiff attorneys write. Furthermore, the beneficiaries of the care do not have the capability to hire and supervise independent care providers as the law would require.

For the home care agencies, the law would lead to a loss of business, forcing some to consider shutting their doors.

Lawmakers hoped the law would save the cash-strapped state some money. Independent providers are reimbursed at a lower rate through Medicaid than providers who work through an agency.

The cost savings are questionable, though, in part because taxpayers would end up paying the health care premiums for the independent providers.

Regardless, attorneys for the plaintiffs say the law violates federal law, including Medicaid law and the Americans with Disabilities Act, because it discriminates against people based solely on their status as a family member of someone with a disability.

Because the judge agreed to grant a temporary restraining order, any harm has been postponed.

At least for now, care givers can continue to work through home care agencies. And the people who rely on that care will continue receiving it from relatives.

A hearing on a preliminary injunction is scheduled July 28.

Unions Weigh In Big Time on California Solar Development

Don Brunell — Thu, 02 Jul 2009 13:31:04 -0700

From GreenerWorking.com:

California’s burgeoning solar industry suddenly finds itself facing a challenge that’s worse than a week of rain — winning labor union support. Companies that agree to hire union workers seem to sail through approval hearings. Those that buck the union system get hammered with environmental impact reviews, costs and delays.

The New York Times reports that when solar power developer Ausra wanted to build a solar plant, it was challenged by labor lawyers who were terribly worried about protecting the environment and animal habitats. Ausra didn’t want to hire union workers.

But an even larger solar plant proposed by BrightSource Energy sailed through the approval process, with enthusiastic support from the same union group, the California Unions for Reliable Energy.BrightSource had agreed to hire union workers.

Wash. Supreme Court Sides with Employees In Punitive Damages Case

Kris Tefft — Thu, 02 Jul 2009 10:55:36 -0700

One of the few areas where Washington law allows the imposition of punitive damages is in employment law, where an employer may be found liable for double damages and attorney's fees when he or she "wilfully and with with intent to deprive the employee of any part of his wages" fails to pay the employee all the wages he or she is due. This law also one of the few areas that "pierces the corporate veil" in that corporate officers are personally (as opposed to corporately) liable for the damages.

So it's a big deal. And there has been some uncertainty over what the law means by a failure to pay wages that is "wilful" and "with intent to deprive." Our Supreme Court has previously held that a struggling employer's financial inability to pay wages owed is no defense to a finding of willful withholding.

This morning, the Supreme Court extended that principle to hold that a legal inability to pay wages is also no defense. In Morgan v. Kingen, the court held 6-3 that an employer's involuntary chapter 7 bankruptcy proceeding, in which its assets are under court supervision and it lacks any legal ability to pay wages, still counts as failing to pay wages "wilfully and with intent to deprive."

Writing for the majority, Justice Charles Johnson stated "The payment of wages holds a preferential statutory position, highlighted by the imposition of personal liability for exemplary damages, costs, and reasonable attorneys fees as a penalty for the willful failure to pay wages owed. As such, we decline to expand the defenses to negate a finding of willfulness to include financial status, specifically chapter 7 liquidation." Describing the employer's court-imposed legal inability to pay as just another kind of financial status problem under the court's prior case law, the majority went on to determine this was still a willful withholding of wages.

In dissent, Justice Richard Sanders argued "The majority incorrectly holds that [the employer] willfully failed to pay their employees. In fact the assets of [employer] were seized, and they could not pay their employees even if they had wanted to pay them. The bankruptcy court's conversion of the proceeding negated [the employer's] willingness to pay. . . . Their failure to pay was not volitional or willful but rather court-imposed."

AWB, joined by six other statewide business organizations, filed an amicus curiae ("friend of the court") brief arguing the position Justice Sanders adopted in dissent. We urged the common-sense view that legal inability to pay a claim should not be mistaken for an intentional refusal to pay it.

Employees are always and rightly entitled to the full wages they have earned. But unfortunately, the court in this case expanded what was meant to be punitive damages for intentional misconduct into a kind of personal payroll guarantee even if an employer has no legal claim to the assets from which wages would be paid because of bankruptcy.

That is a troubling precedent in troubling economic times.