Bethel, NY’s Hydraulic Fracturing Ban; Public Comments

Sections 345-38 of the proposed Bethel law would explicitly prohibit injection wells, natural gas and/or petroleum exploration activities; natural gas and/or petroleum extraction activities, natural gas and/or petroleum extraction, exploration or production waste disposal/storage facilities, natural gas processing facilities, underground injection, high-impact uses and other specified activities.


(Breathing Is Political left the Bethel Town Board’s March 15, 2012 Hearing on Town Law No. 1 of 2012 about twenty minutes before its finish. At that point, thirty members of the public had spoken in favor of the proposed law which would ban high-volume hydraulic fracturing as a high-impact activity in the Town and four members had spoken against the law and in favor of permitting H-VHF activities. According to Larysa Dyrszka, supporters of the legislative ban collected more than 500 petition signatures and at least 100 letters.  

Unfortunately,  the Town of Bethel’s website appears to be “down,”  but  the proposed legislation is scheduled for a vote at one of the April  Town Board meetings which regularly occur on the 2nd and 4th Wednesdays of each month at 7:30 pm.  If interested,  the Town’s phone number is:   845-583-4350.)

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On March 15, 2012, the Bethel, NY Town Board heard from the public concerning the Town’s proposed Local Law No. 1 of 2012. (For more information, “findings of fact,” and an explanation of the proposed legislation, please see Appendix A and the Town of Bethel’s Land Use Analysis: Hazardous or Natural Gas and/or Petroleum Acivities and Industrial Uses.)

In introductory remarks, Bethel Town Attorney Robert McEwan described the proposed legislative changes as “explicitly prohibiting certain uses Town-wide” and as “amending Zoning Board procedures.”

According to a February 28, 2012 River Reporter article, Mr. McEwan said, “…that the amendment would not only ban gas drilling, but also a number of processes related to gas drilling, as well as high impact uses.” In the same article, Attorney McEwan clarified that, “High-impact uses are the kinds of industries that put out large amounts of pollution….” (BIP Note: The North American Industry Classification System mentioned in the article categorizes industries and assigns them “classification numbers” which can be researched here. The NAICS “is frequently used for various administrative, regulatory, contracting, taxation, and other-non statistical purposes.”

The provisions of Bethel’s Local Law No. 1 of 2012 most-addressed by speakers at the Hearing are these:

  • (6) Land Use Control. This Local Law is intended to act as and is hereby declared to exercise the permissive “incidental control” by the Town of its police power applied to the area of land use planning and the physical use of land and property within the Town, including the physical externalities associated with certain land uses, such as negative impacts on air and water quality, roadways and traffic congestion and other deleterious impacts on a community. This Law is not intended to regulate the operational processes of any business. This Local Law is a law of general applicability and is intended to promote the interests of the community as a whole; and
  • Sections 345-38 which explicitly prohibit injection wells, natural gas and/or petroleum exploration activities; natural gas and/or petroleum extraction activities, natural gas and/or petroleum extraction, exploration or production waste disposal/storage facilities, natural gas processing facilities, underground injection, high-impact uses and other specified activities.

PUBLIC COMMENTS CONCERNING BETHEL TOWN LAW NO. 1 OF 2012:

Although approximately forty people spoke at the the Hearing, Breathing Is Political offers these excerpted remarks as representative of the statements made:

Margarita Gleyzer referred to the fact that some who support H-VHF have called opponents of the process “fear-mongers.” In response, Ms. Gleyzerr  said, “Fear is an innate quality that keeps us from harm. We are not guaranteed jobs from fracking but we are guaranteed damage to our resources. Fracking is not a small town issue; it’s an international concern.”

Jeffrey Allison referred to many claims made by natural gas extraction companies as “myths:”

  • “We’re told there’s 100 years of shale gas in the Marcellus. At best there’s eleven.” (BIP Note: According to the US Geologic Survey, “The Marcellus Shale contains 84 trillion cubic feet of… technically recoverable natural gas and 3.4 billion barrels of…technically recoverable natural gas liquids…” Using US Energy Information Administration data, the U.S. consumed 24.37 trillion cubic feet in 2011. Accordingly, even if all the natural gas in the Marcellus Shale was actually recovered and not shipped to Norway, Japan, etc., we would gain only an additional 3-5 year supply.)


  • “We’re told that H-VHF will bring thousands of jobs but 77% of jobs are filled by out-of-state workers.” (BIP Note: The Center for Economic and Policy Research begs to differ with industry claims of job creation in Pennsylvania drilling areas: “What the data tell us is that fracking has created very few jobs. In fact, employment in five northeast Pennsylvania counties…with high drilling activity declined by 2.7 percent.” (Even accounting for the recession, CEPR calculates a total of “around 1,350 jobs — [which] includes both direct jobs in the gas industry, indirect jobs in the supply chain and induced jobs from spending by workers and landowners.


  • “We’re told that natural gas is cleaner than coal but scientists disagree.” (BIP note: A study issued out of Cornell University reports that gas extraction’s carbon footprint is likely larger than that of coal production.)

Richard Gebel and many other speakers spoke to the natural beauty of Bethel that might be laid waste by high-volume hydraulic fracturing.

Physicians such as Larysa Dyrszka, James Lomax and Hal Teitelbaum spoke to the human health impacts of H-VHF.  One of their shared concerns is that New York State’s draft Supplemental Generic Environmental Impact Statement largely ignores those human health impacts. They talked about the dangers of Naturally-Occurring Radioactive Materials (NORMs) and their impacts on water, soil, our foodshed – our human ecology. (BIP Note: Gas Drilling Tech Notes — with which BIP is affiliated — has an extensive library of scientific articles concerning H-VHF, the waste and radioactive materials produced by the industry’s processes and their impacts on natural and human environments.)

Eric London, a physician and researcher remarked that to begin fracking without a health impacts study would be unethical and he commended the Town Board for its efforts to protect the residents of Bethel.

Jennifer Young, a Bethel farmer, thanked the Town Board for taking a proactive stance. “The National Farmer’s Union has called for a moratorium. I raise free-range eggs and I depend on the quality of our land and water resources. We must support our farmers. We’ve seen an 18 percent decline in farms where gas extraction occurs.” (BIP Note: Apparently, Ms. Young was referring to a 2007-10 study conducted by Dr. Timothy Kelsey at Pennsylvania State University’s College of Agricultural Science. In his conclusions, Dr. Kelsey states, “Changes in dairy cow numbers also seem to be associated with the level of Marcellus shale drilling activity. Counties with 150 or more Marcellus shale wells on average experienced an 18.7 percent decrease in dairy cows, compared to only a 1.2 percent average decrease in counties with no Marcellus wells.”)

Kate Kennedy, a local business owner and resident in the Town of Delaware said, “We need our creamery. We need our slaughterhouse. We are poised to be the New York City foodshed. Fracking will endanger that.”

Laura Berger responded to frequent industry claims that New York State’s regulatory structure and oversight are the “toughest” by citing to The Environmental Working Group’s assertions that New York State is ill-equipped to oversee H-VHF and quoted, “New York has just 14 inspectors to oversee 13,000 existing natural gas and oil wells.”

Ronald Turner said, “This is a big moment for the Catskills. It might be the biggest since our towns were flooded to create the reservoirs. Fracking is not conducive to the qualities that draw people here.” He asked what would happen as the underground infrastructure that’s necessary for H-VHF begins to decay. “Who will monitor that decaying infrastructure,” he asked.

Of the speakers who asked the Bethel Town Board to delay passage of legislation that would ban H-VHF within the Town’s borders, Bill desRosiers of Energy In Depth‘s Marcellus affiliate — the public relations arm of the Independent Petroleum Association of America (IPAA) — was the first to speak and urged the Town Board and Hearing attendees to visit the website, “Frac Focus.” “You can track every well drilled,” he said. “You can find GPS locations and view the chemicals used.” (BIP Note: As Jill Weiner remarked  in her subsequent rebuttal of Mr. desRosiers’ statements, release of chemical-usage information is voluntary, not mandatory.  Further, the Frac Focus site states, “Because the make-up of each fracturing fluid varies to meet the specific needs of each area…” there is still no way of knowing which chemicals were used at a specific site. Additionally, only non-proprietary chemicals are listed at Frac Focus.)

Mr. desRosiers also referred to the March 15, 2012 press release from the Environmental Protection Agency detailing its findings to date on water samples from Dimock, PA. “EPA’s testing in Dimock failed to show elevated levels of contamination,” he claimed. (BIP Note: A reading of the actual press release shows that contamination was discovered, that the testing is incomplete and that “EPA will continue to provide water” to three of the homes which are currently receiving such deliveries. Relatedly, Water Defense has asked several serious questions concerning EPA Region 3’s handling of the Dimock situation which has diverged significantly from investigations conducted by other EPA regional offices. Following EPA’s March 15th announcement, Dimock-resident Scott Ely drew water from his well and collected it in a plastic jug on March 16, 2012.  Thanks to Michael Lebron for this timely photo.)

In conclusion, Mr. desRosiers asked the Town Board to delay its approval of its proposed Town Law 1-2012, “Appeals will be filed in the Dryden and Middlefield cases. I urge you to await the results of the appeals process.” (BIP Note: Mr. desRosiers reference is to two recent New York State Court decisions which upheld the right of local jurisdictions to restrict certain activities within their boundaries.)

Sondra Bauernfeind, the former Chair of the Sullivan County Conservative Party, opined that “Zoning reduces property rights” and reiterated Mr. desRosiers’ request that the Town Board delay approval of the proposed law until “higher courts weigh-in” on the Dryden and Middlefield decisions. Further, Ms. Bauernfeind suggested that laws which prohibit a landowner’s exploitation of his/her property’s resources amount to a taking. “Delaware County wants $81 billion from NYC for property takings.(BIP note: Several courts have dealt with this issue of “takings” (or “Inverse Condemnation” as it’s known in the law) and many legal scholars have concluded that such claims will be struck down in the courts. An introduction to the topic can be found in BIP’s article, “Gas Drilling: Inverse Condemnation: Private vs. Public Interests.”

Harold Russell, a former Bethel Town Board member and opponent of the proposed Town Law pointed to foreclosures in Sullivan County and the dearth of employment for young people in our communities. “Use your heads not your politics!” he finished. (BIP Note: For more on property values, mortgages and natural gas extraction, please see “Rush to Drill for Natural Gas Creates Conflicts With Mortgages.”)

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In addition to the many Town of Bethel residents who spoke, residents from the Towns of Delaware, Lumberland, Cochecton and Callicoon were also in attendance, due, presumably, to the potential for natural gas exploration, extraction and processing activities being conducted in their Towns.

If you live in a Town where high-volume hydraulic fracturing is being considered, be aware that the process in Bethel has taken, to date, approximately fifteen months.  One resident close to Bethel’s process suggested,  “It makes sense for Towns just looking into zoning protections to consider a moratorium first.  With that in place, they can begin to address potential zoning changes.”

For more information on moratorium efforts, The Community Environmental Defense Council —  David and Helen Slottje —  is the  non-profit public interest law firm based in Ithaca, New York that worked — for free —  with  Bethel and many other Towns in New York. 

The Community Environmental Legal Defense Fund (CELDF), based in Pennslvania,   “is a non-profit, public interest law firm providing free and affordable legal services to communities facing threats to their local environment, local agriculture, the local economy, and quality of life.  Our mission is to build sustainable communities by assisting people to assert their right to local self-government and the rights of nature.”

 

Opinion: Defend Local Food AND Water

Perhaps the following ideas for a more unified community plan will encourage others to add more pieces. Without a plan, I fear our region will end up divided against itself:

1. Listen to local producers and work cooperatively with them to build the Buy Local movement in our communities;
2. Create a Delaware River Basin Buy Fresh Network or similar cooperative union of local producers and local consumers;


On July 19, 2009, Eileen Cear posted a comment to Breathing Is Political which I’ve excerpted here:

“What about the poor people living here for generations. We NYC people(I’m actually on Long island), but own property in the watershed, take such advantage of this area, and take away all future developement for people [who] have been here first. Remember what we all did to the Indians. We need to do something for upstate, not only take-and direct ALL future activites in the name of being our Playground.”

In re-reading my response to her comment, I have to say that I blew  by Ms. Cear’s very real concerns about the future of farmers and long-time property holders in the Delaware River Basin.

On July 11, 2009, I’d written,  “If I thought a line of  Neo-Gandhis standing in front of the [natural gas] drilling equipment would  turn the tide, I’d do it in a heartbeat but I still wouldn’t know how to convince the grocery clerk, the farmer or the graduate to join me.”

Perhaps the following ideas for a more unified community plan will encourage others to add more pieces.  Without a plan, I fear  our region will end up divided against itself:

1.   Listen to local producers and work cooperatively with them to build the Buy Local movement in our communities;
2.   Create a Delaware River Basin Buy Fresh Network or  similar  cooperative union of local producers and local consumers;

3.   Create a local coalition of  producers, retailers/wholesalers, lenders, consumers and government entities to:

Support distribution of local goods through local outlets.

Support retail and wholesale markets whose inventory is comprised of         60-75% local goods.  Encourage them to build cooperative purchasing         models that can reduce the cost of goods;

Support  politicians and candidates who work with local producers,               retailers,  wholesalers, lenders and local consumers to make local                   distribution economically viable and to promote the cooperative
distribution of local goods to local outlets;

Support local banks with a track record of lending to local producers            for capital improvements and expansion which result in greater                   production and availability of local goods;

Support new tax structures that encourage local production,                   distribution and sales of local products.

Encourage local schools and restaurants to buy/serve locally-produced         foods.

The day we stand beside the Delaware River to pour in our cups of water and to celebrate our roles as caretakers,  we must also pledge to join our farmers in creating vibrant, dependable markets for their goods. Our communities are actively harmed when we buy fruits, veggies, grains, dairy and meat products that originate a thousand miles from our tables. Without local control of our community resources, it’s difficult to understand how our communities will survive.

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Here are more links with good information for those of us who are  as committed to preserving our local food resources as we are to rescuing our River and water:

Community Alliance with Family Farmers (CAFF)
Transition US
Go Green NOLA
Food Routes

There are also a bunch of local  “Green Beings”  and Community Resource links here.

Locally, Sullivan Transition is meeting Monday, July 27, 2009 from 6 to 8 PM at Cornell Cooperative Extension. The group is dedicated to planning “…our LOCAL future in regard to food, green building and energy, education/awareness raising, local currency and economy, transportation, water and other resources…” Please see the CottageWorks Community Calendar for contact information and additional details.

Local Student Asks, “Does The Future Include Me?”

When I was growing up I used to love dreaming about what I would be when I got older. Maybe a veterinarian, a teacher, doctor, a writer. My dreams and hopes were immeasurable. As I grew older, I saw that many jobs were being lost; many people no longer had job security. I became concerned about what I would do when I reached an age where a decision must be made. Would my job choice be sufficient for me to live somewhat comfortably and have a sense of job security?


As part of our series, “The Recession Outside My  Window,” our guest writer is eighteen year old  Ashley Colombo, Sullivan County resident, grocery store clerk and full-time  Orange County Community College student (OCCC). “I absolutely love it at OCCC — have never enjoyed school more,” she says.  “I’m going to be majoring in psychology, English, and criminology, but don’t  have a clue what I want to do when I grow up.”)

When I was growing up I used to love dreaming about what I would be when I got older. Maybe a veterinarian, a teacher, doctor, a writer. My dreams and hopes were immeasurable. As I grew older,  I saw that many jobs were being lost; many people no longer had job security.  I became concerned about what I would do when I reached an  age where a decision must be made. Would my job choice be sufficient for me to  live somewhat comfortably and  have a sense of job security?

Then, I began thinking about our technological revolution and how dependent we are on it. I realized that many jobs will be lost due to this revolution. For instance, in the future, schools won’t be necessary. Kids will sit in their homes and have their lessons broadcast to them. Thus, custodians, school nurses, teacher’s aides, cafeteria ladies, administration, guidance counselors are just a few positions that won’t be necessary. I believe, literally, that hundreds and thousands of jobs will  be annihilated due to our dependence on technology.

I also thought about the  overwhelming amount of money we’re forced to spend on school  in order to gain access to  many  soon-to-be   nonexistent jobs.  What bothers me most about going to college  and possibly beyond, is that after we spend thousands upon thousands of dollars, we are not guaranteed a job in the field we have so painstakingly studied. I know that as technology is totally integrated into  our society,  all those college degrees and doctorates and those cute little paper diplomas with the shiny seals, will mean absolutely nothing.

We hope that the pretty piece of paper in that frame will buy us groceries and pay our bills but  too many of us will  fall into the ‘my job choice no longer exists’ category. That’s what faces us even as  we start our adult lives in thousands, if not hundreds of thousands of dollars in debt.

It worries me that school costs so much in the first place.  It  makes absolutely no sense whatsoever.  Why must it be so hard to get ahead? We pay dearly for trying to make ourselves into something —  to better ourselves and to enrich our lives. What for? Why should I spend this money to try and make my life better, when in the end all it will do is knock my legs out from under me and take everything I have?

This seriously discouraged me about wanting to go back to school. I knew I had to, but did I really want to go through all of it just  to end up  coming home from being a greeter at a chain supermarket and  looking at the forsaken piece of framed paper hanging up on my wall,  knowing I was hundreds of thousands of dollars in debt because of it?  It’s a repulsive vision of a future that will probably be the reality faced by most of my generation and the generations to come.

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(Breathing Note:  Please encourage our Guest Writers by clicking the very tiny, nearly invisible “comment”  link hidden in the tags and categories beneath Ashley’s commentary.  Breathing Is Political extends its heartfelt appreciation to Ashley for participating in our “View Outside My Window”  series.)

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Draw A Line in the Sand: DRBC Hearing: July 15, 2009

Special Agent Leroy Jethro Gibbs says, “There are no coincidences in a murder investigation.” What about in cases of “depraved indifference?” When Coca Cola’s bottling practices destroyed water tables in India, didn’t the company know, as a “reasonable person,” that the local farmers and communities would be decimated?


Each day, we tell ourselves there are lines we won’t cross.

But, as global food, water and housing crises tear at the fabric of our local communities, it’s increasingly difficult to pay local farm market prices when Wal-mart has plastic-coated apples for less.  Eventually, as things get tougher, crossing even our most deepset lines is inevitable.  People who had jobs last year are  sleeping in tents and cars this year. Some of us will steal  food and shoes for our children and property holders wil sell gas leases to  drilling companies like Chesapeake.

It’s fine and dandy to say that stark times demand stark lines set in  stark terms but  gray areas abound. Diametrically opposed interests claim the same motivations. Consider the issue of hydraulic fracturing.  Proponents say, “Drilling is in the national interest. It’s a matter of national security.”  They say  there’s no evidence that fracking poisons our water, land, food and people.  Opponents  also cite “national security” but point to circumstantial evidence that links fracking  to increased earthquake activity, polluted well water and a plethora of health concerns. (“Circumstantial” because the gas drilling industry is currently exempted from disclosing the chemicals they use  in hydraulic fracturing.  Consequently, no  evidentiary studies have been conducted.) Interestingly,  few Congresspeople support full disclosure of  fracking chemicals. (Find out if your Senators and Representative support The FRAC-ACT (Fracking Responsibility and Awareness of Chemicals Act,  S1215/HR2766).)*

Special Agent Leroy Jethro Gibbs says, “There are no coincidences in a murder investigation.” What about in cases of  “depraved indifference?” When Coca Cola’s bottling practices destroyed  water tables in India,  didn’t  the company know, as a “reasonable person,”  that the local farmers and communities would be decimated? When Monsanto polluted water and soil in  a bevy of locales,  didn’t the company, as a reasonable person, understand  the dangers posed by its actions to the local water, soil and animal/human population?  When Dow and the US government bathed Vietnam and its populations with Agent Orange (dioxin), they knew  the dangers. When my beloved Lake Erie was dying and the great Cuyahoga River burned,  didn’t the corporate polluters know their own practices were suspect?

All over the world, like lobsters dying quietyly in cold water brought to a slow  boil,
people are being incrementally dispossessed of rights, health,  life and property by corporate-government collusion. Doesn’t that collusion meet the legal tests of “depraved indifference” and “conspiracy?”

Don’t be silly.  Of course it does! but the guilty ones have written the laws. They’ve covered their liability with convoluted “immunity” clauses.  They’ve stacked
the deck.

Petroleum wars are so passé, don’t you think? In the near future, our beautiful children will wear their patriotic colors to the  water wars.  Around the world, corporations control greater and greater percentages of the world’s water.  Rampant pollution will lead to reductions of our finite “water reserves”  and the costs of “water reclamation” will skyrocket.  Exorbitant water bills will be a fabulous source of revenue for…somebody.  Probably General Electric of Hudson-River-pollution-fame.

A smart friend of mine recently said, “We beat back NYRI because we could see the corporate bad guy.  Gas frakking’s completely different.  It’s pitting neighbors against neighbors.”

So what do I, a wildly flabbergasted opponent of fracking, say to a twenty-something  grocery clerk  who sacrificed her teen years in  minimum wage jobs because she dreamed of going to college?  What do I say when she tells me she can’t go back to college in September because even the local community college costs more than she’s saved?

What do I say to the man who folds clothes for minimum wage  at the local laundry because the bank refused him a bridge loan to keep his restaurant open?

What about the  graduate student with an education debt in excess of $250,000 and no health insurance or  the dairy farmers in hock up to their necks who anxiously watch  their corn seed rot in the field?  What is my counter-offer when a drilling company waves a $100,000 gas lease in front of  them?

The Natural Resources Defense Council tells us frakking is a done deal but Damascus Citizens for Sustainability (DCS) fights on. “The DCS is part of a nationwide coalition of groups of citizens speaking from their homes, who do not want their environment and lives and communities further ruined by the current irresponsible approach to energy sourcing. It is our right and obligation as citizens to participate in the choices that will affect our future.  DCS’s concern is for the health and sustainability of life here (NE Pennsyvania) for us as people, and for the entire ecosystem we and all those downstream depend on.”

Members of the DCS are regular attendees at Delaware River Basin Commission (DRBC) meetings. They are knowledgeable about the threats posed by  hydraulic fracturing   to our ground water, food supply and health. Their site is chock-full of facts, studies, maps and advocacy as well as articles about The FRAC-ACT (Fracking Responsibility and Awareness of Chemicals Act,  S1215/HR2766).

Please  browse their resources.  Plagiarize  their text and write a letter to the DRBC. Contribute to the DCS  legal fund and attend the DRBC Hearing on  Wednesday, July 15th.  (Email me at cottageworks@lizbucar.com  if you’re looking to carpool and I’ll forward your information to a carpool coordinator.)

The Hearing will consider an application by Chesapeake Appalachia for  “permission from the Delaware River Basin Commission (DRBC) to withdraw 1 million gallons a day from the West Branch of the Delaware River for hydraulic fracturing and natural gas extraction.  This is the first application to the DRBC for this purpose and would put the Delaware River Watershed at risk for tens of thousands of applications to follow…The Hearing will be held at 1:00 pm at…Northampton Community College’s Fowler Family Southside Center, 511 East 3rd Street, 6th Floor, Room 605, Bethlehem, Pennsylvania. WE NEED PEOPLE THERE!”

(If nothing else, please read the Damascus Citizens’ Letter to Delaware River Basin Commission It is a  comprehensive  iteration of why the DRBC must deny Chesapeake’s current application.)

*As to The Frac Act: it will NOT stop the drilling.  It merely forces drilling companies to identify the  chemicals they use during the hydraulic fracturing process so that once our public water supply is poisoned, we can, ostensibly, prove the drilling companies did it.  (The Safe Drinking Water Act only protects  public water wells that service 25 or more individuals. Very few rural-dwellers   get their water from public wells!)

So who will buy our properties when our aquifers are poisoned?  Who will pay the taxes?  When our ground water is polluted, who will buy the food we produce locally and work so hard to distribute?  And even if the FRAC Act is passed, how many of us will have health insurance?  Who among us will be able to afford the diagnostic tests  necessary for participation in full-blown epidemiological studies?  And  once we’re guinea pigs without a human voice, who will ensure that epidemiological studies of our poisoned bodies are conducted?

When your local legislator refuses to draft a  resolution banning hydraulic fracturing until chemical disclosures and studies are made,  ask him/her the questions posed here.

In  The Pianist, Warsaw prisoners are made to lie belly-down in the dirt.  Their
shoulders nearly touch.  Each body shudders as an executioner’s bullet shoots through the back of its head. First one… then the next and the next. Each prisoner feels the slight jar and stillness when the one beside him is killed.  None raises a voice  or a hand. Their eyes are closed. I’ve thought they succumbed without a fight because  the horror was beyond understanding; or because the crushing of the Warsaw Ghetto Uprising had sapped their will; or that they hoped for a miracle or believed, if  they were very, very quiet, they’d be invisible to the executioner.  The nearer the footsteps behind them, the quieter they lay — like babies hiding behind their hands in games of peek-a-boo — seeking invisibility.

Wherever we draw the line at this crucial moment, saving our communities isn’t over just because  the Natural Resources Defense Council says fracking is inevitable. It’s  over when we quit.

When people lose control of their local resources, it’s hard to argue  the existence of healthy communities. I grew up on Lake Erie. I watched it die  and our community with it.  When it was revived, so was our village.

If I thought a line of  Neo-Gandhis standing in front of the drilling equipment would  turn the tide, I’d do it in a heartbeat but I still wouldn’t know how to convince the grocery clerk, the farmer or the graduate to join me.

Good informational links:

Hydraulic fracturing and  fishing

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Communities In Transition


According to an organizer,  thirty-seven participants attended the June 9, 2009 Transition Sullivan community meeting.   Their purpose is to build a Sullivan County whose economic base is “sustainable and resilient in a new age of expensive oil, galloping climate change, and reduced funding for communities.”

Like Transition Towns in England, Transition Sullivan participants will investigate two crux issues:  how does a community evolve past  its dependence on declining petroleum resources and reduce its carbon emissions in order to strengthen itself and its people?

The notion of communities powering themselves is not new but it is gaining in vigor.  This past weekend, I was delighted to spend  time with Tom Lambert who’s been a long time champion of Sullivan County’s evolving independence.  We reminisced about attempts twenty years ago to extend high speed rail service to Callicoon from Port Jervis.  (The memory of those frustrated efforts  spurred one of us to  unseemly language  and it wasn’t Tom.)  By the end of the discussion,  we cautiously agreed that perhaps we’d been too early to the party twenty years ago.

Whether it’s farmers growing their way out of oil dependence in Iowa, powering a town with wind in Minnesota or generating radio broadcasts with water power in Jeffersonville, NY,  the seeds of change have been sown locally, nationally and internationally.

In the past, some activists  stopped listening  the minute they heard “bio-fuels.”  Others buried their heads at the mention of  “wind towers”  and others sputtered unintelligibly when “nuclear” was  whispered.  We each have preferences.  Each of us is  capable of finding faults in any solution but more than ever, we recognize that our futures are being sorely wasted.

Today, The Center for Discovery’s Thanksgiving Farm is inspirational in its scope.  New York State’s Energy Research and Development Authority (NYSERDA) was an unknown agency just a few years ago but today, it reels beneath the demand for licensed professionals capable of comprehensive green renovations.  Our very own  Sullivan County Community College stepped up and now offers a degree program in Green Building Maintenance and Management.

Seems to me that Tim Shera and Maria Grimaldi have organized their Transition Sullivan initiative at the perfect time.  Grab your neighbors and family.  Join them on June 16, 2009 at 6:00 PM at the Sullivan County Cornell Cooperative Extension for the second organizational meeting.

Try to  visit Transition Towns and Open Space Technology beforehand  so you’re familiar with the Transition Towns  model in England  and how the meeting will be conducted.  Think about the town, hamlet or village where you live.  Jot down a list of resources your community brings to the larger table and  for an overview of the first meeting, please see the new article at The Catskill Chronicle.


House Financial Services Subcommittee Hearing


Here are high points of the Hearing I found interesting and some of my own thoughts. (Quotation marks are included where statements are actual quotes rather than the “sense” of what was said.)

BARNEY FRANK, Democrat & Financial Services Committee Chairman.   As major stockholders, the US Government should try to recoup $165 million in bonuses by filing  a lawsuit alleging “poor performance” on the part of  bonus recipients.  He also demanded the names of bonus recipients and updates when bonus recipients either return or refuse to return  bonus money. (Although New York’s Attorney General Andrew Cuomo is in receipt of these names, Liddy expressed a need to protect bonus recipients because of  deadly threats made against them and their families.)  (According to  the Center for Responsive Politics,  Frank received $202,548 in contributions from the Insurance Industry.)

OLYMPIA SNOW, (R) Maine.   Offered AIG bailout provisions which would have disallowed most of the oversized bonuses.  (Received $5,000, according to the Center for Responsive Politics.)

CHRISTOPHER  DODD, (D) Connecticut.  Snow’s amendment was (allegedly) struck by  Connecticut’s  Chris Dodd.  How he did it is unclear.  At first, he denied the act.  Subsequently,  he said  he received instructions from Treasury and/or The White House.  Regardless, striking the provision resulted in Congressional approval of bonus contracts entered into before February 11, 2009.  As a result,  165 million taxpayer dollars have been paid to architects of the debacle. Reportedly, Dodd received $852,556 from insurance lobbyists.  (Center for Responsive Politics)

STEPHEN LYNCH, Massachusetts:  “We amend  contracts all the time.  My auto workers were badgered and badgered….  These [AIG] guys lost billions of dollars  and still believe they’re entitled to these bonuses.” (Lynch  received $35,299 according to the Center for Responsive Politics)

PAUL KANJORSKI, Chairman, Financial Services Subcommittee on Capital Markets (D-PA).   Admitted to knowing about the incipient bonus payments  two months  ago and  “warned Liddy that  paying the bonuses would be a  big mistake.”  “You [CEO Edward Liddy] should have told the bonus recipients to ‘sue us.'”  (Kanjorksi did not mention warning anyone else and according to the Center for Responsive Politics, received $345,548 in donations from the insurance industry.)

Joel Ario,  State of Pennsylvania Insurance Commissioner and  Chairperson of the National Association of Insurance Commissioners.  Ario believes that AIG’s toxic holdings could be walled off from its healthy funds-at-large.   (NB:  Therefore, the company at-large could survive if its sick subsidiaries were permitted to fail.) (Also see: [Funny] Side of the [Wall] Street:  Obamanomics.)

Neither the Government Accountability Office (GAO) nor the federal Office of Thrift Supervision (OTS)  have investigated whether AIG fraudulently misrepresented its health and wealth at the time it was creating “retention” and other bonus contracts  “to the tune of $400 + million  with the division that was bleeding to the tune of $40 billion.”

Another committee member asserted, [“The distribution of these bonuses] borders on fraud and criminality.”

According to Scott Polakoff of OTS, his agency knew the risk of the credit default swaps  in 2004 and did nothing to avert the collapse.  OTS did not close AIG’s toxic financial products division even though “the agency had a complete picture and oversight authority” to do so.  Polakoff further stated that “OTS had sufficient  expertise and personnel” but in effect, since Congress didn’t instruct OTS to review the  bonus contracts before AIG’s bailout was approved, the agency didn’t do the research.

Rodney  Clark of Standard & Poor’s (S & P) rating agency was asked,  “How can we depend on you and were mistakes made?”  Clark answered, “Hindsight being 20-20…, our conclusions [of AIG’s solvent value]  changed rapidly once the market started to collapse.  Market values are important as a guideline.  We could not understand  how quickly the value of mortgage backed securities would decline….  (NB:  On what basis, then,  did S & P  justify its AA-  rating until  September 15, 2008 if ?)  S & P hedged its bets. Ratings are based on current value and  give prospective investors a factual basis for predicting future performance.)  Clark  went on to say,   “In 2008, excluding  investment losses,  AIG would’ve been profitable.”

Really?  Does that mean S&P didn’t see the looming  losses or didn’t consider them relevant to the total value of the company?  (See: Ratings Agencies falsify reports or search CSPAN’s  archives for quotes from ratings agents who knew full-well that the mortgage-backed securities were toxic but provided healthy ratings because…that was the outcome corporations paid them to obtain.  (See:  previously-cited statement from Joel Ario.)

Edward LIDDY,  AIG insurance Chairman & CEO (temporarily appointed  in 2008 to detoxify AIG).   Prior to Mr. Liddy  taking his witness  seat,  he was stopped by  “pink lady demonstrators” who questioned him (in part) about  consequences to returning war veterans whose savings were invested  with AIG.  If he answered, it wasn’t televised.

He did tell us that the risk to AIG was unacceptably high if we did not pay the $165 million in bonuses. “It was my determination,” he said, “that AIG-FP would unravel if employees weren’t retained to wind down the projects they were working on.  Which they did.  They’ve reduced $2.7 trillion in toxic assets to $1.6 trillion.  It’s my intention to reduce those debts, sell AIG’s insurance companies and strengthen the healthy portions of our business.  If we don’t pay our debts, that triggers bankruptcy. I’ve asked AIG-FP (financial product) employees to return a portion  of the bonuses.   Believe me, I wouldn’t have approved the contracts if I’d been CEO  at the time they were  created.”

Liddy further asserted that Federal Reserve Chairman Ben Bernanke acquiesced to the  payment of retention bonuses.

“We didn’t tell Congress because nobody told us to,” Liddy explained.  “We’re partners with the Federal Reserve. They participate in  activities leading up to board meetings and they attend board meetings. I asked if they had comments  or different points of view as far as bonuses and everything else.  The Federal Reserve  did  not  disagree with our assessment that AIG-FN was at risk of jeopardizing the monies already given if we didn’t pay the bonuses. We were told by our attorneys that the contracts were unbreakable.  I assumed they shared  with Treasury and Congress information they gained from us.  The Secretary of the treasury did not know we were going to make the [bonus] payments though the Federal Reserve did.  It’s  up to the Federal Reserve to  discuss”  salient issues with the Secretary of the Treasury.

Later,  Treasury Secretary Timothy Geithner said he didn’t know about the bonus contracts until two weeks ago.

Countering assertions of possible fraud, Liddy said he believes,  “AIG was solvent when the retention contracts were drawn.”   (On what factual basis did he develop this assessment?  Or,  is he just repeating assessments  from ratings agencies which regurgitated AIG’s own corporate projections?  Isn’t that the same self-quoting claptrap that got us into Iraq?)

Liddy  continued,  “AIG has problems besides the mortgage-backed securities. There’s oil accounts and other  utilities in trouble.” (This appears to contradict his assertions of fundamental solvency.)

ED PERLMUTTER, Committee Member.  “There’s a whole fraud concept that says ya’ can’t be handing out bonuses when you’re insolvent.  I don’t think these bonuses should have been paid.”

Some legal issues, AIG’s Employee Retention Plan and relevant case and statutory findings.

Currently, some members of Congress are promoting tax legislation which would target bonuses paid by corporations that received stipulated bailout funds. Their idea is to re-appropriate the funds already disbursed. (There is every reason to believe such targeting is unconstitutional.  Seeing as how Congress writes the laws and  has more than its fair share of attorneys,  you’d think they’d know that.)

AIG-FP 2008  Employee Retention Plan, effective December 1, 2007

(Importantly, there is no signing date on the Retention Plan although it specifically covers 2008 and 2009.)  According to CEO Liddy’s Executive Summary of the retention plan in which he discusses the bonuses,  “The plan was implemented because there was a significant risk  of departures among employees at AIGFP, and given the $2.7 trillion of derivative positions at AIGFP at that time, retention incentives appeared to be in the best interest of all of AIG’s stakeholders…. This resulted in a $313 million total for 2008 and a $327 million total for 2009… The 2008 awards range from $1,000 to slightly less that $6.5 million.  Only seven employees will receive more than $3 million…. The retention plan is governed by Connecticut Wage Act.  (Section 4.04)”   (NB:  The law provides for the recovery of double damages and attorneys’ fees when wages are improperly withheld and the employer’s refusal to pay wages lack a good faith basis. Conn. Gen. Stat  sections 31-72.)  “In addition,”  states Liddy, “individual managers who decide to withhold wages that are due are individually liable for violation of the Wage Act…We have been advised that the bonus provisions of the American Recovery  and Reinvestment Act of 2009 prohibiting certain bonuses specifically exclude bonuses paid pursuant to pre-February 11, 2009 employment contracts.”  (Apparently, this is the  alleged  “Dodd Provision.”)

NB: The definition of “executive employee”  rests largely on whether an employee is salaried, is required to exercise personal discretion in performance of duties,  earns in excess of certain dollar amounts and has (usually) some supervisory responsibilities.

According to the Connecticut Wage Statute (sec. 31-71(e).  “No employer may withhold or divert any portion of an employee’s wages unless (1) the employer is required or empowered to do so by state or federal law and  (i) “Wage” means compensation due to an employee by reason of his employment.  (Italics added for emphasis.)

Liddy’s  Executive Summary referenced Schoonmaker v Lawrence Brunoli, Inc. 828 A.2d64 (Conn.2003). Schoonmaker established that double damages could be paid when salaries are withheld for reasons of  “bad faith, arbitrariness or unreasonableness.”

The courts have also established that, “Punitive damages may be awarded in suits in which it is proven by clear and convincing evidence that the defendant’s [employer’s] actions showed willful misconduct, malice, fraud, wantonness, oppression or [lack of care] which would raise the presumption of conscious indifference to consequences. Under O.C.G.A. 51-12-5.1(b), it remains the rule that something more than the mere commission of a tort is always required for punitive damages. There must be certain circumstances of aggravation or of outrage.”

New York’s Attorney General Andrew Cuomo may attempt to use the Fraudulent Conveyance Act to recover the bonuses.

In order to pursue Fraud charges, “… the misrepresentation [or omission] must be made knowingly and intentionally, not as a result of mistake or accident; that is, that the person either knew or should have known of the falsity of the misrepresentation [or the false effect of the omission], or that he made the misrepresentation [or omission] in negligent disregard of its truth or falsity.

NB:  Under the Bankruptcy Code, insolvency exists when the sum of the debtor’s debts exceeds the fair value of the debtor’s property, with some exceptions. It is a balance sheet test. 11 USC § 101(32)

18 USC CHAPTER 47 § 1031 concerns  “major fraud against the United States”  and  is another  statute being considered by  New York State’s Attorney General Cuomo. It  provides  the following:

(a) Whoever knowingly executes, or attempts to execute, any scheme or artifice with the intent-

(1) to defraud the United States; or

(2) to obtain money or property by means of false or fraudulent pretenses, representations, or promises.

Therefore, the two most important facts to ascertain  are,  “What was AIG’s actual state of solvency when the bonuses were contracted and did its officers misrepresent that state?”

More Answers Needed:

Which Congress people  received campaign finances from AIG and other financial corporations?  How much did they receive? How did those congress people vote or speak on salient congressional  actions?  (You can find some of the answers at  the Center for Responsive Politics and RollCall.  Feel free to vote accordingly in upcoming elections.)

At the time of AIG’s bailout or request for a bailout, what was the corporation’s actual worth?

Was the United States coerced by fear and intimidation into awarding bailout funds?

Besides Christopher Dodd, who was involved in exempting bonuses agreed to before February 11, 2009?   To  what extent were Treasury and The White House involved?

As always, you can view the hearings at CSPAN.

[F]unny side of the [Wall] Street: Obamanomics

In the spirit of Jon Stewart, “Let’s just cut out the middle man.” If President Obama is serious about “changing how we do business,” then he needs to roll out something better than his new version of Reaganomics.


Imagine  you’re the on-duty emergency room (ER) nurse in a small country hospital.  Your resources are severely limited by high unemployment and a health insurance crisis.

A healthy snowboarder hobbles in with a broken leg and dislocated shoulder.

You start a prophylactic IV drip of normal saline, pain killers  and antibiotics to protect the snowboarder from dehydration, pain and infection.

In a corner of the emergency room is a bloated near-corpse in systemic organ failure. His liver’s shot.  His heart’s all but stopped.  The smell of his rot and disease are spreading out of the ER, down the corridors and into the rooms of recuperating patients.

Emergency room protocol requires you to infuse the snowboarder’s  IV solution through the bloated near-corpse middle man first, rather than  into the snowboarder’s arm directly.

Proponents of this bassackward policy say that if the gas in the bloated guy explodes, it’ll jeopardize everyone in the hospital so we have to treat him with the best of the drugs and hope enough benefit reaches the snowboarder to prevent her relatively minor injuries from becoming a systemic threat.  If you’re the cynical type, you might think  the nearly-dead guy’s membership on the hospital’s Board of Directors is significant, too.

Whatever the reason for  the policy, the outcome is assured:  the bloated near-corpse will drain  your few precious resources on its way to the morgue and the healthy patient will die of preventable consequences.

In the spirit of Jon Stewart,  “Let’s just cut out the middle man.”  Break with protocol and centuries of obsolete thinking. Infuse the snowboarder directly. She’s going into shock.  Microbes are chewing on her broken, exposed bone. It’s a matter of basic triage:  apply your resources where they will do the most good as you asses each situation  uniquely, dispassionately and quickly.

The snowboarder (like most of our  neighbors) will heal quickly and be ready to continue her education,  develop new products, create new markets  and in general, become the new economic engine.  She’ll be rebuilding our nation while the rotting AIG-Goldman Sachs-Citi-Bank of America-corpse that’s poisoning us all is buried quietly in the background.

Stimulate acutely-ill  borrowers with a direct infusion of debt-cancelling cash that can be paid by them  to their ORIGINATING lenders.   The funds will or won’t trickle UP to the bloated entities who bought and bundled the  stinky credit card and mortgage loans.  Those who are too-big-to-fail will collapse if the funds can’t  find their way through the maze of intermediaries.  But, by  excising the corpse and caring directly for our fundamentally healthy neighbors, we can mitigate the effects of this new shift in focus and purpose.

The “mortgage-crisis” isn’t the root of our problems.  And our continued reliance on a rotting corpse to rescue the future may not be the cause of our problems, but it’s certainly proximate.  If President Obama is serious about “changing how we do business,”  then he needs to roll out something better than his new version of  Reaganomics.

*     *     *     *

NEXT:  Tell-tale quotes from this week’s House Financial Services Subcommittee Hearing.

Commercials: Society’s Economic Mirror


While knitting and cogitating on the day’s jury*  events,  the background drone of TV commercials finally penetrated.

“What,”  I wondered, “do companies advertise when the stock market’s below 7,000 and new (monthly) unemployment claims regularly exceed half a million?  What’s worth the hefty investment in TV advertising?”

During the Wednesday night 7:30-9:30 time slot (MSNBC, USA, CBS) a snapshot emerged.  The largest advertising sector was Cable TV’s ads for its own products:  new programs,  old programs and upcoming specials guaranteed to improve your tax outlook and trim your monthly budget.

In terms of “products,”  Madison Avenue supports our return to home-cooked goodness, so gather the family round the table and make some nostalgia as you tuck into old fashioned dehydrated macaroni & cheese and  canned chunky soup brimful of luscious garden veggies.  Or, for a treat (only your budget knows the limits) try a chef-cooked bucket from the local KFC.

If you haven’t been drinking enough Brita-filtered tap water,  stock up on Activia yogurt or the colon cleanser of your choice.  Also, if you’re noticing an uptick in cholesterol, edema and/or chest pain and the emergency room’s sick of seeing you, get a bottle of aspirin  and join Jenny Craig or a similar national diet plan.  (MONEY SAVER IDEA:  purchase a single membership and apportion the food  to your family of four.  Huge budget benefits guaranteed!)

Our neo back-to-Foxfire-basic relies on simple things:  Fixodent, toilet paper,  TV.com (save electricity by planning your nightly viewing) GMC trucks (if your patriotism includes rebuilding America!) Dunkin Donut’s  aromalicious beans for homebrew,  Olay deep cleansing wash (for after a day of shoveling compost),  Dr. Phil, anti-depressants  & anti-constipation drugs of  choice sold cheap at Walgreen’s or  Wal-Mart (not your local pharmacy),  quick-flush toilets, do-it-yourself legal forms and finally, two attorneys  —  one for torts and one for bankruptcy.  If you’re a small business owner who’s still hanging an open sign, Verizon wants their Small Business Toolkit to be your new bff.  Yee gads! Verizon’s got your number!   What?  Well of course they’ll  have to turn the phones back on….

For those of us not living in a new back-to-basic tent city neighborhood, add Travelocity to the list of resources bolstering your pared down life.

Except for one final  advertiser, that’s it in a nutshell:  a yellow brick trip through Madison Avenue Oz and its representative,  Cable TV.

I want to underscore  my last advertiser for its uplifting message.  Bank of America is America’s Bank of Opportunity.  I swear on an oath,  I smelled green grass and green tech constructing a green and bounteous future.  An inspirational partner for each of us, no doubt.  As a start, if you were one of the thousands of BOA partners they accidentally  socked for improper fees,  make sure you apply  for your $78 refund from the  the class action fund.

*    *    *   *

Skeletal thoughts from the past week:

Jon Stewart’s rip of CNBC, Jim Santelli and Jim Cramer is the most brilliant commentary I’ve seen in years.  (Cramer will be Stewart’s guest tonight.  That is, if he doesn’t “bail out”  like  Santelli did.)

In the large picture, Bernie Madoff is a scapegoat.  Let’s see what happens to those who made all the destructive schemes possible:  the SEC overseers, ratings agencies, Congress and Presidents going back to at least Reagan.  For sure, he should go to prison; but how does that benefit his (and the SEC’s) thousands of victims?

CNBC and its guests are taking a hand in shoring up our trust in the financial markets and  their institutions.  The new confidence game is beefy with cheery language and predictions.  MSNBC’s Morning Joe crew groaned at Mark Haines’ proclivity for  gloomy predictions.  Two mornings ago, Haines  eschewed doom and announced the Market had found its bottom.  The Dow’s closed in positive territory since. In fairness, his gloomy outlook changed the same day Citi’s CEO announced that his company was doing just fine. Quick fix.

*Aside:  Am currently serving on a Grand Jury which has an impact on my writing schedule.  More on that near the end of April when the service is complete.

The Class Warfare Trigger


Consolidating wealth in 2% of pockets is not class warfare.

Monopolizing water and fuel resources is not class warfare.

Transferring wealth from the lower 98% to the financial class is not class warfare.

Giving bonuses to the top 2% and stripping 3 million jobs from the lower 98% is not class warfare.

Transferring wealth from the lower 98% to the insurance industry  is not class warfare.

Wealthy people living above  the water line while the lower 98% drown or are displaced in New Orleans is not class warfare.

Investors buying the properties cheap and manipulating zoning laws is not class warfare.

Toxic and/or crumbling schools in rural and urban areas is not class warfare.

Old books and empty libraries in rural and urban schools is not class warfare.

Increased costs of  State colleges and restricted enrollment is not class warfare.

Under-educated  kids enlisting  in the military while others go to college isn’t class warfare.

The elderly losing their pensions while ratings agencies skate free is not class warfare.

CEOs and Congresspeople sporting excellent health insurance while workers are bankrupted for its lack is not class warfare.

Congress fiddling  in endless hearings while workers are foreclosed is not class warfare.

Food shortages are  not class warfare.

Contamination of cheap protein sources (peanut butter) is not class warfare.

Tax codes that reward Buffett and add $12.00 a week to workers’ pockets is not class warfare.

Paying outlandish bonuses to failed CEOs while the UAW is asked to make further concessions is not class warfare.

Putting drug addicts in prison as Halliburton changes its name and gets new government contracts is not class warfare.

Giving taxpayer money to financiers who squeeze taxpayers for increased bank fees is not class warfare.

Secretaries paying taxes at a higher rate than their corporate bosses is not class warfare.

Wealth-based and regional access  to broadband internet is not class warfare.

Class warfare is  when a pattern of unequal access to wealth and power emerges and we have the chutzpah to complain about it.