IEA: The Oil Glut Is Going Nowhere

IEA: The Oil Glut Is Going Nowhere

Authored by Irina Slav via OilPrice.com,

Global oil markets will remain well supplied this year, with a possible overhang of some 1 million bpd, the head of the International Energy Agency, Fatih Bitol, told Reuters.

“Non-OPEC production is very strong. We still expect production coming from, not just United States, but also Norway, Canada, Guyana, among other countries,” Birol said, adding

“Therefore, I can tell you that the markets are, in my view, very well supplied with oil, and as a result of that, we see prices remain at $65 a barrel.”

Norway is about to experience a sharp jump in oil production in the next four years, a new forecast from its Petroleum Directorate has shown. After a steady decline over several years, production is set for a 43-percent increase between 2019 and 2024, the NPD said, reaching 2.02 million bpd in 2024. This will be thanks to the start of production at the Johan Sverdrup offshore field along with several smaller fields.

In Guyana, Exxon has just begun production from the Liza-1 well. Daily output from the deepwater field should reach 120,000 bpd before the end of 2020. Exxon is also building a second production vessel that should raise the total to 220,000 bpd.

In Canada, meanwhile, oil production is also set to grow despite a government-imposed curtailment aimed at supporting prices. The curtailment was relaxed twice in 2019 and it only concerns large producers, allowing smaller ones to pump as much as they can sell. Based on this, the Canadian Conference Board recently forecast oil production in the country will be growing at 4.2 percent annually between this year and 2024.

Demand growth, however, will be slow, according to Birol.

“We are expecting a demand growth of slightly higher than 1 million barrels per day,” the top IEA man told Reuters.

This means that except sudden spikes in prices due to geopolitical factors or possible production outages in a major producer, oil prices this year will remain largely range-bound.


Tyler Durden

Sun, 01/12/2020 – 09:20

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Macron Abandons Plan To Raise Retirement Age As Rock-Throwing Protesters Get Tear-Gassed

Macron Abandons Plan To Raise Retirement Age As Rock-Throwing Protesters Get Tear-Gassed

French President Emmanuel Macron has scrapped plans to raise the retirement age from 62 to 64, as tens of thousands of anti-government activists – many donning yellow vests – returned to the streets of Paris and elsewhere on Saturday to protest the proposed pension reforms, according to the New York Times.

The mood was militant, and the more violent demonstrators once again clashed with the police, even as they sowed a trail of damage through eastern Paris. A bank branch was sacked, and bus shelters smashed and fires set. Unions said 150,000 protesters were in the streets of Paris on Saturday. –NYT

Saturday’s demonstrations included exchanges between rock-throwing protesters and the police, who used tear gas, water cannons and other crowd control measures as the day wore on. At one point a building was set on fire.

The government of France plays a major role in retirement pensions – both providing and guaranteeing funds and overseeing the entire system.

The bid to boost the retirement age infuriated moderate unions Macron relies on, despite his insistence that French citizens need to work longer in order to keep the pension system – which may be facing a $19 billion deficit – financially sound.

In a Saturday letter from Prime Minister Edouard Philippe, the Macron administration said that it would “withdraw” the new age limit, and postpone major decisions on how to keep the system solvent until it can better assess the situation “between now and the end of April.”

Macron described it as a “constructive compromise,” which French union CFDT applauded. The CGT union called the measure “a smokescreen,” however, which protesters agreed with as they took to the streets on Saturday.

Right-wing French politician Marine Le Pen called the Macron administration’s move a “dishonest” negotiating tactic.

“You introduce something that’s unacceptable, and then you withdraw it,” she said, adding “Nothing justifies this reform.”

Mr. Macron has insisted that his retirement plan represents a fair, rational response to the new world of work, where careers are interrupted and French citizens no longer stay in the same job for life.

The plan would replace the current system of 42 different pension regimes, most tailored to match individual professions, with a single, points-based system that will be the same for everybody. Workers would accumulate points, then cash them in at the end. Bus drivers in Toulouse would get the same retirement benefits as those in Paris — not now the case, as the Paris system has some of the country’s most generous benefits. –NYT

As the New York Times notes, “the government’s concession is unlikely to end either the strike or the demonstrations,” as “The more militant unions — and the ones most heavily represented in the railways and the Paris subway — are demanding that Mr. Macron abandon his entire reform plan.”

We’ve got to continue to mobilize, until they pull the whole plan, pure and simple,” said French Parliamentarian Eric Coquerel from the far-left France Unbowed Party.

(h/t @MTGphotographe for excellent coverage of events)


Tyler Durden

Sun, 01/12/2020 – 08:45

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Will A Credit Crisis Threaten Boris’s 2020 Brexit Plans?

Will A Credit Crisis Threaten Boris’s 2020 Brexit Plans?

Authored by Alasdair Macleod via The Mises Institute,

Boris and the Conservatives won the General Election with a very good majority. In truth, opposition parties stood little chance of success against the Tory strategists, who controlled the narrative despite a hostile media. At the centre of their slick operation was Dominic Cummings, who masterminded the Brexit leave vote, winning the referendum against all the betting in 2016. It was Cummings who arranged for the Tory Remainers to fall on their swords, which by removing the whip reduced the Tory ranks, making them appear vulnerable enough for the opposition parties to tear up the requirement for a supermajority and vote for a general election.

It was straight out of Sun Tzu’s playbook: “All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.” The way the Remainers were removed was both brutal and public. On September 3, fifteen of them went for a meeting in Downing Street, obviously convinced, with Johnson only having a parliamentary majority of one, that they were in a very strong position to negotiate either for a second referendum or Brexit in name only. Dismissing them, Cummings was blunt to the point of rudeness: “I don’t know who any of you are.” And they left with nothing.

Observers at the time saw this as suicidal, but Cummings appears to have known what he was doing. The hapless rebels had no coherent plan other than to threaten, and their bluff was called. Better, it seems that Cummings concluded, to purge the parliamentary party of serial rebels than to be beholden to them.

Much has been written about how the election victory was won. About the focus groups, about listening to Labour voters. About the “Get Brexit Done” slogan. But Sun Tzu Cummings also encouraged Labour to hang themselves. The Tories kicked off addressing the number one concern of ordinary people, tackling crime. Then came the NHS — more nurses and hospitals. This was a carefully set trap, getting the Marxists in Labour to outbid the Tories on spending to patently ridiculous levels. Having set down that route, they added nationalising water, trains, and broadband. Everyone then knew that Labour promises were not only a joke, but downright dangerous. The Conservatives’ promises were just deliverable, particularly since they were prepared to sacrifice an earlier promise to cut corporation tax.

What Now?

Obviously, Britain will leave the EU on or before January 31 next. All of 2020 subsequently is set to be taken up in trade negotiations with the EU, which will not be extended. The first post-Brexit negotiation of note will be over fisheries policies and the right of access to British waters for EU fishing vessels, due to be agreed by July 1 and implemented after the transition period.

The hope initially expressed by establishment figures in both Westminster and Brussels was that with a thumping majority the Conservatives would soften their Brexit demands, because it is no longer beholden to the ERG, an alliance of free marketeers in the Conservative parliamentary party. This being the case, it was argued, British demands for a return to total sovereignty over British fishing waters could be compromised in the context of wider negotiations. This is what always happens in Brussels, and the establishment on both sides assumes the British will continue to play that game. But the Remainers have not been paying attention: the way in which the Conservative rebels were dealt with is the new negotiating philosophy.

Far from taking the opportunity of a large Conservative majority to soften their stance in negotiations, all the indications (for those who bother to look rather than just assume) are that the British will take a firmer negotiating stance. If the EU tries to blackmail the UK over fisheries — France being an obvious instigator given her powerful fishing lobby, and Spain over Gibraltar, which has nothing to do with fisheries — the British will be prepared to walk away from negotiations, because at that point, the Political Declaration will be breeched, not by the British, but by the EU.

In truth, the negotiating power has shifted firmly to Britain from the EU. Brussels will be dealing with a new anti-establishment administration, unsympathetic toward the Brussels bureaucratic administration and determined to free the UK from as much of it as possible. The Brits are now focused, and Sun Tzu strategically clever with it.

Dominic Cummings possesses an exceptional intellect. His tutor in ancient history at Oxford, Robin Lane-Fox, reckoned him to be altogether in a different league to Boris Johnson. But Johnson is no slouch, either, and with backgrounds in the classics the two work well together. Other notable brains are Jacob Rees-Mogg, Sajid Javid, Michael Gove, Dominic Raab, and Priti Patel. Collectively, the leading lights in the Johnson cabinet stand head and shoulders intellectually above any other cabinet seen for a long time.

The ERG, whose members are drawn from the pool of Conservative MPs that favors a free market approach over statist intervention, has enjoyed a substantial influx of members from the new parliamentary intake. A definite shift towards free market, one-nation conservatism has taken place. This is not what an arrogant establishment readily understands or wants. In the corridors of Westminster, establishment figures will now have an added concern: the threat to their bureaucratic power and even their jobs. They are used to a Downing Street whose time horizon is never more than a few days. It will now actively plan for the future.

The New Political and Economic Philosophies

Leading members of the new cabinet are philosophically free traders, whose politics favour lower government intervention and lower taxes, fostering entrepreneurial ambition and encouraging wealth creation. A smaller government focused on outcomes will be a lesser burden on productive society and also provide the means of affording the best public services on a cost-effective basis. We have heard similar intentions before from incoming Conservatives, but this time there is a greater determination for it to be delivered, and with Cummings in charge of the special advisers (Spads), it is perhaps more likely to succeed.

While we can only guess at his true understanding of the benefits of free markets over socialism, Johnson has dropped a few clues that he has some knowledge of the economic issues involved. He quoted Bastiat’s broken window fallacy in an article for the Daily Telegraph on September 15, 2017, which only a genuine free trader who has discarded Keynesian intervention will understand. Equally encouraging was his remark at a private function in June 2018, when he said “F[…] business,” which was aimed at business lobbyists, otherwise known as crony capitalists seeking preference over everyone else.

These hopes are usually buried by the reality of government. But there is some hope that over the course of this parliament and next the UK will gradually free the economy from overbearing government intervention. While also being an advocate for the private sector, Cummings has a managerial approach. From his writings, we know he is a believer in the use of soft power to enhance a nation’s prospects. He quotes Thucydides, who described Athens as the school for Greece, with his ambition for Britain to be the school for the world. In other words, Britain will need to foster and develop the highest levels of education, technological know-how, and entrepreneurial opportunity if it is to progress as a nation relative to the powers of tomorrow such as China and India.

Having grabbed the reins of government, Cummings intends to finance his objectives by slashing bureaucracy and centralising political power in the hands of a few key players. Thence his intention that the cabinet be substantially reduced from the current thirty-three members.

What appears to be absent, if only because the subject has not yet arisen, is an understanding of money, the relationship between budgets, trade balances, savers, and the credit cycle. Generally, politicians delegate monetary matters to the central bank. This government will be no different. But the current governor of the Bank of England is due to retire at the end of January, a date that may be shifted because it now coincides with Brexit. We can be sure the necessary qualification for a candidate will be acceptability to the world of central banking — in other words, another inflationist.

Sajid Javid, chancellor of the exchequer, says he intends to borrow to finance infrastructure spending while keeping a tight rein on current spending. Every incoming finance minister says something similar, betraying a Keynesian approach to the relationship between government and the wider economy. Besides ignoring Bastiat’s parable on broken windows, any increase in government borrowing not met by an increase in savers’ savings is inflationary. If Javid truly believes he can separate current from investment spending and therefore follow sound money policies, he fails to understand economics at its most basic level. Doubtless Cummings would sweep this concern to one side on the basis that investment in infrastructure, particularly for northern constituencies, is necessary to convert regional voters fully from Labour to Conservative and secure office for the whole decade. And in time, it would be covered by funds released through more effective administration.

The Establishment Is Due for an Enormous Shake-Up

To understand in a little more detail what the Johnson administration plans to do, we need to take a step back. Over much of 2019, Boris Johnson, Jacob Rees-Mogg, and a few others were actively planning to oust Mrs. May and replace her with Johnson. In its early stages, the plans had little support in the parliamentary party, though Boris was wildly popular with grassroots Conservatives. But when Mrs. May was forced to defer Brexit until after the EU elections in May, Nigel Farage swept the board in those elections with his Brexit Party, and it was clear that the Conservatives, without a firm Brexit commitment, would be wiped out in Westminster. Mrs. May was forced to resign, Johnson’s campaign gathered momentum, and he became prime minister in July.

Three days before becoming prime minister, Johnson invited Cummings and his original Vote Leave team to work again with him to deliver Brexit. Cummings was appointed a special adviser to the prime minister and is now the chief Spad, controlling all ministerial Spads across government. As a former senior civil servant put it, “Mr. Cummings told all Whitehall’s Spads that he was now effectively their line manager, rather than their Secretaries [sic] of State.” It is no exaggeration to say that Cummings now exercises more control over the permanent civil service than any permanent secretary, as well as a high degree of control over elected politicians appointed as ministers.

With Johnson’s support, Cummings has plans for radically reforming the establishment. In a lecture given at the Institute for Public Policy Research in 2014, he said his wish list would include rule changes to enable ministers based in the House of Lords to be questioned in the House of Commons. He believed the cabinet should be shrunk from some thirty ministers to six or seven. When he was Michael Gove’s Spad of education, he wanted to push through reforms to ensure that less money was spent on process and more on objectives, but he lacked the power for wholesale reform. He ensured so far as he was able that spending was on improvements to the education system instead of ministerial flights of fancy, from which Gove, to his credit, was generally free. Cummings’s strategic success at education is now planned to be extended throughout all ministerial departments, and the money saved should be considerable, enough to meet spending objectives and provide tax cuts in due course.

The problem with the civil service is that during the Blair years it became overly bureaucratic. Tony Blair’s government paid enormous sums to management consultants to advise and implement improvements. Unfortunately, payments to consultants became linked to the length of time they spent on contracts, time which was extended by introducing detailed and procedure-heavy checks and balances on every aspect of government spending. The practice extended to contracts given to the private sector, forcing enormous bureaucracy onto projects such as HS2 (the high-speed rail link from London to the North), which, before any track has been laid, is already due to run substantially over budget. A simple task which should cost something in the low hundreds becomes thousands.

As Cummings put it in his speech to the Progressive Policy think tank in November 2014, employment policy in the civil service encourages failure. There is very little incentive to reduce regulation, and no incentive to save money, because the treasury is primarily interested in power over the system. Cummings says that civil servants are overpaid for what they are meant to do, are interested in process and empire building, and never take the blame for things that go wrong, which happens more often than not.

If Cummings gets his way (and he is the most powerful operator in the new administration) the civil service will see substantial change, leading to less bureaucratic waste and better decision-making. The all-encompassing power of the treasury will be broken. After Brexit, we can also expect a radically slimmed-down cabinet, giving greater control at the centre of government, but at the same time power is likely to be devolved from the Westminster establishment to the regions. Electoral reform will follow, with a planned reduction in Westminster seats from 650 to 600, favouring the Conservatives, and the Fixed-Term Parliament Act rescinded. Reform of the House of Lords, particularly given their Brexit-blocking tactics, seems likely to be on the agenda as well.

The establishment has lost and will be heavily punished. The influence and cost of bureaucracy will be curtailed, and the costs released will be apportioned between final objectives (police, nurses, hospitals, etc.) and cuts in taxation. The objective is to reverse the current Pareto Principle at play in which it seems 80 percent is spent on process while 20 percent is spent on final objectives. If it can be achieved, the prospects for Britain relative to other nations in the EU, which are bound by their bureaucracy, will improve greatly.

Public Investment Policy

Despite senior ministers being free traders at heart, government plans for intervention will increase its role in the economy. The closest parallel is probably China, whose government gives private individuals and their businesses a framework of five-year plans within which to develop. Instead of five-year plans, the UK government works to an electoral cycle of five years with no certainty of continuation. The first priority will be to deliver infrastructure and regional government hubs to the North, with particular emphasis on newly converted constituencies to ensure future loyalty.

Transport, better broadband, and mobile signals are on the agenda. State support for research will allow technology hubs to devolve beyond the London-Oxford-Cambridge triangle, beefing up the northern universities. Cummings is known to favour copying the US’s Advanced Projects Research Agency, designed to develop military technology, with a British equivalent pursuing a wider commercial objective.

Johnson is also a keen proponent of free ports, where goods can be moved in and out without paying customs duties. Alternatively, businesses working within a designated free port area benefit from duty-free imports and from a cluster effect through the attraction of other businesses. Free ports, which include airports, are a simple way to target local development.

A Credit Crisis Is Due during Trade Negotiations

Although the Johnson/Cummings plans hold much promise, there is an exogenous factor likely to threaten them. The global credit cycle appears to be on the turn, and with it will come a systemic crisis.

There are signs (for example, the repo crisis in New York and mounting problems in eurozone banks) that the periodic credit crisis that always follows a period of credit expansion is imminent. If it breaks out before January 31, the government will undoubtedly face pressure to put Brexit on hold. The civil servants in the treasury and the Bank of England in particular will almost certainly try to persuade the government to extend the implementation period and even reverse Brexit, but with Johnson and Cummings in charge, it is unlikely to be delayed. Following Brexit, however, Britain may still be faced with contractual obligations to the EU in the event of an EU banking crisis during the negotiating period. There can be little doubt that it would be an enormous mess, likely to undermine the course of planned government spending.

The blame game will then commence. With Britain having established that you can, after all, leave Hotel California, the political adhesion that binds EU member states together will almost certainly be weakened by economic reality. A rational expectation would be that mounting problems would encourage a more realistic EU policy regarding Brexit and trade negotiations. But the relationship between the EU’s panjandrums and reality is barely tangential, so it would be sensible to expect talks to break down in these circumstances.

Therefore, in the event of a global or European credit crisis taking place, a so-called no-deal Brexit becomes an increased possibility. But this is unlikely to worry the new Conservative government, which is inclined towards free trade anyway. It’s just good politics to have someone else to blame.


Tyler Durden

Sun, 01/12/2020 – 08:10

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Utah Government Considering Canceling DEPORTM Personalized License Plate

The Salt Lake Tribune (Erin Alberty) reports:

[T]he Utah Tax Commission is considering recalling the license plate after complaints this week on social media.

“We’re not sure how it got through,” said Tammy Kikuchi, spokeswoman for the commission, which oversees the Utah Division of Motor Vehicles. “We’re really quite surprised.” … [O]fficials are reviewing the plate for compliance with provisions in state law that forbid vanity plates that “may carry connotations offensive to good taste and decency or that may be misleading” and express “contempt, ridicule or superiority of a race, religion, deity, ethnic heritage or political affiliation.”

“I don’t know why it was approved in 2015,” [Kikuchi] said, adding: “The current DMV director was not the director then.”

I think canceling the plate would violate the First Amendment:

[1.] Vanity plate contents are private speech, not government speech. Though Walker v. Sons of Confederate Veterans held that license plate designs are government speech, and the government can generally pick and choose which ones are allowed, vanity plates convey the owner’s own views. Courts are split on the matter, with a recent Maryland high court decision and a federal district court decision in Kentucky taking the view I articulate here, and an Indiana Supreme Court decision taking the opposite view. To quote the Maryland court’s analysis:

In [Walker v. Texas Div., Sons of Confederate Veterans (2015)], the U.S. Supreme Court determined that a Texas-issued specialty license plate displaying a Confederate flag constituted speech by the government, not speech by the Texas Division of the Sons of Confederate Veterans, the organization that sought the plate design…. The First Amendment protects, however, private speech on government property, with some limitations.

In the present case, … a message on a vanity plate … is private speech. Applying the Supreme Court’s first analytical factor [from Walker], historical usage, although license plates in general function historically as government IDs for vehicles, vanity plates display additionally “a personalized message with intrinsic meaning (sometimes clear, sometimes abstruse) that is independent of mere identification and specific to the owner.”  The unique, personalized messages communicated via vanity plates contrast with the generic, depersonalized speech conveyed by a specialty plate: “[m]any Maryland vehicles display identical specialty plates; only the registration numbers, which on a specialty plate have no intrinsic meaning and carry no message, will vary.”

Additionally, private citizens, not the State of Maryland, create and submit prospective vanity plate messages. “So, historically, vehicle owners have used vanity plates to communicate their own personal messages and the State has not used vanity plates to communicate any message at all. Unlike the license plate slogans that States use ‘to urge action, to promote tourism, and to tout local industries[,]’ vanity plates are personal to the vehicle owner, and are perceived as such.”

Turning to the factor of audience perception, “[t]he personal nature of a vanity plate message makes it unlikely that members of the public, upon seeing the vanity plate, will think the message comes from the State.”  Unlike the specialty plates at issue in Walker, vanity plates bear unique, personalized, user-created messages that cannot be attributed reasonably to the government.

The fact that this kind of speech takes place on government property—a license plate—is not transformative in this context of private speech into government speech.  Indeed, the Supreme Court’s public forum doctrine … exists only because of the need to analyze government restrictions of private speech that takes place on government property. Nor does the juxtaposition of private speech on government property transform the public perception of the speaker’s identity….

Considering the third factor of the government speech analysis, … the [government’s] statutory and regulatory authority to deny or rescind a vanity plate based on the content of its message does not rise to the level of “such tight control that the personalized messages become government speech.”  Maryland does not exercise “direct control” over the “alphanumeric pattern” displayed on vanity plates in the same or similar way that Texas controlled specialty plates.  In Texas, the State had “sole control” over the content of a specialty plate. With respect to vanity plates in Maryland, “vehicle owners, not the State, create the proposed messages and apply for them.”  Although the MVA retains discretion to deny a prospective vanity message, its authority to recall vanity plates issued erroneously suggests that the MVA’s control over vanity plates does not rise to the rigorous level required to transmogrify its regulatory approach into government speech.

Contrarily, a recent ruling by the Indiana Supreme Court held that vanity plates constitute government speech because “[l]icense plates have long been used for government purposes” such as vehicle identification, their messages are perceived to be communicated on behalf of the State, and the State “‘maintains direct control'” over the messages they display…. [W]e reject the [Indiana] court’s reasoning because vanity plates represent more than an extension by degree of the government speech found on regular license plates and specialty plates. Vanity plates are, instead, fundamentally different in kind from the aforementioned plate formats. Maryland has not communicated historically to the public with vanity messages. Observers of vanity plates understand reasonably that the messages come from vehicle owners. Moreover, the MVA does not exercise control over vanity plate messages to the extent that Walker informs us Texas controlled specialty plates.

[2.] Under the First Amendment precedents, the vanity plate program is either a so-called “nonpublic forum” or a “limited public forum,” so the government has some power to restrict speech there—but only in a viewpoint-based and reasonable way.

[3.] Matal v. Tam (the Slants case) held that excluding speech that “disparage[s] … or bring[s] … into contemp[t] or disrepute” any “persons, living or dead”—including speech perceived as racist—is viewpoint-based. Likewise, excluding speech that expresses “contempt, ridicule or superiority of a race, religion, deity, ethnic heritage or political affiliation” is viewpoint-based (even if one concludes that urging the deporting of illegal aliens is based on “race” or “ethnic heritage,” rather than based on their being illegally present in the U.S.). And once we conclude that the personalized license plate program involves private speech rather than government speech (see item 1 above), such viewpoint discrimination is unconstitutional.

 

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Utah Government Considering Canceling DEPORTM Personalized License Plate

The Salt Lake Tribune (Erin Alberty) reports:

[T]he Utah Tax Commission is considering recalling the license plate after complaints this week on social media.

“We’re not sure how it got through,” said Tammy Kikuchi, spokeswoman for the commission, which oversees the Utah Division of Motor Vehicles. “We’re really quite surprised.” … [O]fficials are reviewing the plate for compliance with provisions in state law that forbid vanity plates that “may carry connotations offensive to good taste and decency or that may be misleading” and express “contempt, ridicule or superiority of a race, religion, deity, ethnic heritage or political affiliation.”

“I don’t know why it was approved in 2015,” [Kikuchi] said, adding: “The current DMV director was not the director then.”

I think canceling the plate would violate the First Amendment:

[1.] Vanity plate contents are private speech, not government speech. Though Walker v. Sons of Confederate Veterans held that license plate designs are government speech, and the government can generally pick and choose which ones are allowed, vanity plates convey the owner’s own views. Courts are split on the matter, with a recent Maryland high court decision and a federal district court decision in Kentucky taking the view I articulate here, and an Indiana Supreme Court decision taking the opposite view. To quote the Maryland court’s analysis:

In [Walker v. Texas Div., Sons of Confederate Veterans (2015)], the U.S. Supreme Court determined that a Texas-issued specialty license plate displaying a Confederate flag constituted speech by the government, not speech by the Texas Division of the Sons of Confederate Veterans, the organization that sought the plate design…. The First Amendment protects, however, private speech on government property, with some limitations.

In the present case, … a message on a vanity plate … is private speech. Applying the Supreme Court’s first analytical factor [from Walker], historical usage, although license plates in general function historically as government IDs for vehicles, vanity plates display additionally “a personalized message with intrinsic meaning (sometimes clear, sometimes abstruse) that is independent of mere identification and specific to the owner.”  The unique, personalized messages communicated via vanity plates contrast with the generic, depersonalized speech conveyed by a specialty plate: “[m]any Maryland vehicles display identical specialty plates; only the registration numbers, which on a specialty plate have no intrinsic meaning and carry no message, will vary.”

Additionally, private citizens, not the State of Maryland, create and submit prospective vanity plate messages. “So, historically, vehicle owners have used vanity plates to communicate their own personal messages and the State has not used vanity plates to communicate any message at all. Unlike the license plate slogans that States use ‘to urge action, to promote tourism, and to tout local industries[,]’ vanity plates are personal to the vehicle owner, and are perceived as such.”

Turning to the factor of audience perception, “[t]he personal nature of a vanity plate message makes it unlikely that members of the public, upon seeing the vanity plate, will think the message comes from the State.”  Unlike the specialty plates at issue in Walker, vanity plates bear unique, personalized, user-created messages that cannot be attributed reasonably to the government.

The fact that this kind of speech takes place on government property—a license plate—is not transformative in this context of private speech into government speech.  Indeed, the Supreme Court’s public forum doctrine … exists only because of the need to analyze government restrictions of private speech that takes place on government property. Nor does the juxtaposition of private speech on government property transform the public perception of the speaker’s identity….

Considering the third factor of the government speech analysis, … the [government’s] statutory and regulatory authority to deny or rescind a vanity plate based on the content of its message does not rise to the level of “such tight control that the personalized messages become government speech.”  Maryland does not exercise “direct control” over the “alphanumeric pattern” displayed on vanity plates in the same or similar way that Texas controlled specialty plates.  In Texas, the State had “sole control” over the content of a specialty plate. With respect to vanity plates in Maryland, “vehicle owners, not the State, create the proposed messages and apply for them.”  Although the MVA retains discretion to deny a prospective vanity message, its authority to recall vanity plates issued erroneously suggests that the MVA’s control over vanity plates does not rise to the rigorous level required to transmogrify its regulatory approach into government speech.

Contrarily, a recent ruling by the Indiana Supreme Court held that vanity plates constitute government speech because “[l]icense plates have long been used for government purposes” such as vehicle identification, their messages are perceived to be communicated on behalf of the State, and the State “‘maintains direct control'” over the messages they display…. [W]e reject the [Indiana] court’s reasoning because vanity plates represent more than an extension by degree of the government speech found on regular license plates and specialty plates. Vanity plates are, instead, fundamentally different in kind from the aforementioned plate formats. Maryland has not communicated historically to the public with vanity messages. Observers of vanity plates understand reasonably that the messages come from vehicle owners. Moreover, the MVA does not exercise control over vanity plate messages to the extent that Walker informs us Texas controlled specialty plates.

[2.] Under the First Amendment precedents, the vanity plate program is either a so-called “nonpublic forum” or a “limited public forum,” so the government has some power to restrict speech there—but only in a viewpoint-based and reasonable way.

[3.] Matal v. Tam (the Slants case) held that excluding speech that “disparage[s] … or bring[s] … into contemp[t] or disrepute” any “persons, living or dead”—including speech perceived as racist—is viewpoint-based. Likewise, excluding speech that expresses “contempt, ridicule or superiority of a race, religion, deity, ethnic heritage or political affiliation” is viewpoint-based (even if one concludes that urging the deporting of illegal aliens is based on “race” or “ethnic heritage,” rather than based on their being illegally present in the U.S.). And once we conclude that the personalized license plate program involves private speech rather than government speech (see item 1 above), such viewpoint discrimination is unconstitutional.

 

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China’s Geely Considers Investment In Cash-Desperate Aston Martin

China’s Geely Considers Investment In Cash-Desperate Aston Martin

As things get dire in the auto industry across the global, consolidation of companies looks like it could be the next step.

China’s Geely is in talks with Aston Martin, as the EV maker considers partnering what FT calls some “much needed cash” into the luxury automaker. 

Geely is in the midst of due diligence and is looking to potentially take an equity stake or begin a “technology partnership” with Aston Martin. Geely already owns 10% of Daimler, which already sells some technology and engine to Aston Martin. 

Geely also owns Britain’s Lotus and Sweden’s Volvo. 

Aston is struggling financially and trying to raise money after its share price has collapsed more than 70% since becoming a public company in 2018. It issued an “unexpected profit warning” this week, stating that it “remains in discussions with potential strategic investors, which may or may not involve an equity investment into the company”.

It also said it planned on drawing $100 million in high interest debt, which is in addition to $150 million in debt it raised in September. 

There are also other suitors for Aston Martin. Formula 1 Billionaire Lawrence Stroll is considering making an investment of about £200m of an equity issue and result in him controlling 19.9% of the company. He could then increase his stake by buying from other Aston shareholders or in the open market.

Stroll also has links to Daimler, which owns Mercedes-Benz and has the right to turn away fresh investments in Aston from other carmakers. Daimler also has a deal to sell engines and technology to Aston. Stroll uses Mercedes engines in his F1 racing team and while Aston has a F1 partnership with Red Bull, the contract is up for renewal at the end of 2020.

As of now, it’s unclear whether Aston Martin will go with Stroll or Geely. But one thing is for sure: the company needs cash.


Tyler Durden

Sun, 01/12/2020 – 07:35

via ZeroHedge News https://ift.tt/382zpKf Tyler Durden

Socialists in Space

Many viewed the space race of the 1950s and ’60s as a battle between American free enterprise and Soviet communism. But the space program wasn’t exactly a free market endeavor.

The original purpose of the National Aeronautics and Space Administration (NASA) was simply to help extend the development of aviation technology into space—a federal intrusion into the economy, but not a huge one. But with the advent of the Apollo program in 1961, the agency expanded into a massive state enterprise with no room for markets. Because the space race was viewed as an urgent battle in a potentially existential war, cost was no object; the saying around the agency was “waste anything but time.” Because there was a mandate to get to the moon quickly, NASA did it in the most expensive possible way.

This unfortunately created the perception that it had been done in the only possible way. Spaceflight, according to the conventional wisdom, simply had to be accepted as an intrinsically exorbitant endeavor, something only the government of a superpower could do.

With the space shuttle, this mentality continued. NASA would develop and operate a single type of launch system, and it would use it to run a government monopoly responsible for getting all American payloads into space. It became almost impossible to raise funds for development of private rockets until the Challenger disaster in 1986 ended the use of the shuttle for commercial payloads. Fortunately, the Air Force had fought to preserve its own capabilities to get its satellites into space, so once it was no longer forced to use the shuttle for military missions it could continue with the Delta, Atlas, and Titan rockets that it had been relying on since the early ’60s.

Even with the advent of commercial launch vehicles in the early 21st century, even with the 2011 retirement of the shuttle, Congress resisted the idea of private enterprise in space. Once Mike Griffin took over NASA in 2005, George W. Bush’s 2004 Vision for Space Exploration quickly devolved from a focus on commercial launch providers to the subsequently canceled Constellation Program, with a focus on new and expensive government rockets that use shuttle components, owned and operated by the space agency. This happened because he knew that Congress would find anything else unacceptable.

Sure enough, when the Obama administration canceled that program, which was vastly over budget and falling behind schedule, space committees in both houses of Congress insisted that it be restored in the form of the Space Launch System and the Orion crew capsule. This was done on a bipartisan basis, because any fealty the Republicans had to private enterprise was vastly exceeded by their desire for NASA pork. Some, such as Sen. Richard Shelby (R–Ala.), derided the low-cost launch company SpaceX as “hobbyists in a garage.” The spectacle prompted one analyst, Polispace founder James Muncy, to declare that “Democrats don’t believe that capitalism works within the atmosphere, and Republicans don’t seem to believe that it works above it.”

Despite all this, we are now on the verge of getting affordable private access to orbit for large masses of payload and people, regardless of how much money Congress insists on wasting on NASA rockets. After years of delay, both Virgin Galactic and Blue Origin are expected to finally start offering suborbital flights to paying passengers in 2020. More important, both Boeing and SpaceX will be delivering crews to the International Space Station in the coming months, finally ending America’s dependence on Vladimir Putin’s Russia for space station access, which began when the shuttle was retired eight years ago.

Most important of all, two versions of an all-new fully reusable spaceship are being assembled by SpaceX in Texas and Florida; their designs will eventually converge into a single one combining the best features of each. On September 28 at the Texas site, the company’s founder, Elon Musk, described a vehicle almost 400 feet tall that would deliver 100 people to various destinations in space, with the initial capability of achieving orbit within six months, at very low marginal cost.

The work is moving at a pace unseen since the 1960s, and it could result in a true spaceflight revolution, driving the cost of orbital access down to a few tens of dollars per kilogram of payload, rather than the thousands per kilogram it’s been since the dawn of the Space Age. That would open vast new off-planet opportunities for humanity.

It will also bring to the fore a lot of ideological issues that up to now were just theoretical. Opening a frontier is hard. It’s even harder when you’re a socialist.

Most American schoolchildren are taught about the first Thanksgiving, when the Pilgrims, with the help of the indigenous people, celebrated their first successful harvest. The part of the story that often goes untold is what happened before that success—the initial failure that led to the loss of so many pioneers in the first years of the colony. It was not a result of the new environment, so different from that of the long-settled England from which the immigrants had come. It was a failure of socialism.

When the Plymouth Company adopted the settlement’s initial economic rules, it stated that “all profits & benefits that are got by trade, traffic, trucking, working, fishing, or any other means” were to be placed in the common stock of the colony, and that “all such persons as are of this colony, are to have their meat, drink, apparel, and all provisions out of the common stock.” In other words, to use a phrase from a subsequent century: From each according to his ability, to each according to his needs.

About half the settlement died of starvation in the first winter. It was only after the colony changed its rules to allow people to keep the product of their own efforts, for their consumption or for sale, that they finally had the first bountiful harvest. This wasn’t a unique event; many of the early English settlements, including Jamestown a few years earlier, had to learn the lesson the hard way.

What are the lessons of this experience for our next frontier, the harshest one to date? Some view settlements in space as a new venue for liberty and social experimentation. But others, including the famously libertarian science fiction author Robert Heinlein, have argued that this time, the environment really is different in important ways: that the lack of gravity, of natural atmosphere, and of easily available water and food—not to mention a radiation environment for which we are not adapted—will introduce dangers that demand collective controls. Space colonists will be critically dependent on new technologies, just one mistake or failure or act of sabotage away from disaster for an entire settlement. It would be too dangerous, we’re told, to permit the kinds of freedoms that people could have had on the American western frontier. The resources needed to sustain space settlements, these critics say, will require collective, not individual efforts.

But as the technologies for living in space continue to develop, they will in fact offer more opportunities for independent living and new forms of social experimentation, including more libertarian lifestyles. For instance, use of extraterrestrial materials, such as lunar regolith (or moon dirt, for the layman), will allow construction of larger and much more robust structures to protect against vacuum breaches and radiation. Additive manufacturing using such resources will enable smaller groups to be independent in terms of equipment crucial to survival. At some point, food may be manufactured, rather than farmed, on a usefully small scale. Ultimately, of course, terraforming of Earth’s moon or Mars (or even other bodies, such as other moons) could provide the same level of safety in volume that we currently have on Earth itself.

Collectivism isn’t needed in outer space, but plenty of people will try to legally compel it there anyway. Princeton space historian Haris Durrani spoke for them when he claimed recently in The Nation that the 1967 Outer Space Treaty (full name: the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies) “famously opened by declaring space ‘the province of mankind.'” The treaty, which repeatedly uses the phrase “exploration and use,” in fact says that space activities “are the province of all mankind.” In any case, Durrani goes on to complain that the treaty still does not provide “strong collective property rights” (emphasis added).

The space collectivists, recognizing this “problem,” a decade later came up with the Agreement Governing the Activities of States on the Moon and Other Celestial Bodies, a.k.a. the Moon Agreement, which postulates a “regime” that ensures the solar system’s resources are used in an “equitable” way. It also outlaws private property on extraterrestrial worlds—a violation of Article 17 of the Universal Declaration of Human Rights. For these reasons, among others, the U.S. government has refused to recognize the Moon Agreement as one of the U.N. space treaties. The current administration has repeatedly stated that space is not in fact a commons, and many (including me) have argued that the Moon Agreement’s language is fundamentally incompatible with the wording of the Outer Space Treaty and that no one should be a party to both treaties, though all who have acceded to the Moon Agreement are.

The United States became wealthy not through collectivism but through free markets, including secure contract and property rights under traditional English common law. Some have argued that the combination of Article II of the Outer Space Treaty, which forbids claims of national sovereignty, and Article VI, which requires “continuing supervision” of persons by the states that are parties to the treaty, make it legally impossible to establish those rights in space. But without them, it is extremely unlikely that space will be developed, or that the solar system’s rich resources will be harnessed to improve life on Earth and create abundant new life on other worlds.

Some will consider this a feature, not a bug. There are people both within and outside the space community who see space as, at best, a domain only for pure science—and there are people who view humanity as a curse on the planet that should not be allowed to spread beyond it.

Fortunately, there’s a strong case that this interpretation of Articles II and VI is mistaken, and that in fact property rights, whether for homesteading or for harvesting resources, can be allowed under the Outer Space Treaty. Multilateral agreements with like-minded nations could obviate the notion that doing so would be a claim of “national” sovereignty. Several figures in the space community, including me, are now working on a project to develop such agreements, with the U.S. State Department and National Space Council on board.

Space is too important to be left to government monopolies, and while space settlements shouldn’t require English common law, they must be allowed to embrace it. Socialism, like other ideologies, will be permitted off planet. But socialist space colonies will doubtless languish, as they do on Earth. It is those societies that allow individual liberty and free enterprise that will flourish, filling the solar system, and perhaps eventually the galaxy, with life, consciousness, laughter, and love.

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Luongo Fears “An Abyss Of Losses” As Iraq Becomes MidEast Battleground

Luongo Fears “An Abyss Of Losses” As Iraq Becomes MidEast Battleground

Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,

The future of the U.S.’s involvement in the Middle East is in Iraq. The exchange of hostilities between the U.S. and Iran occurred wholly on Iraqi soil and it has become the site on which that war will continue.

Israel continues to up the ante on Iran, following President Trump’s lead by bombing Shia militias stationed near the Al Bukumai border crossing between Syria and Iraq.

The U.S. and Israel are determined this border crossing remains closed and have demonstrated just how far they are willing to go to prevent the free flow of goods and people across this border.

The regional allies of Iran are to be kept weak, divided and constantly under harassment.

Iraq is the battleground because the U.S. lost in Syria. Despite the presence of U.S. troops squatting on Syrian oil fields in Deir Ezzor province or the troops sitting in the desert protecting the Syrian border with Jordan, the Russians, Hezbollah and the Iranian Quds forces continue to reclaim territory previously lost to the Syrian government.

Now with Turkey redeploying its pet Salafist head-choppers from Idlib to Libya to fight General Haftar’s forces there to legitimize its claim to eastern Mediterannean gas deposits, the restoration of Syria’s territorial integrity west of the Euphrates River is nearly complete.

The defenders of Syria can soon transition into the rebuilders thereof, if allowed. And they didn’t do this alone, they had a silent partner in China the entire time.

And, if I look at this situation honestly, it was China stepping out from behind the shadows into the light that is your inciting incident for this chapter in Iraq’s story.

China moving in to sign a $10.1 billion deal with the Iraqi government to begin the reconstruction of its ruined oil and gas industry in exchange for oil is of vital importance.

It doubles China’s investment in Iraq while denying the U.S. that money and influence.

This happened after a massive $53 billion deal between Exxon-Mobil and Petrochina was put on hold after the incident involving Iran shooting down a U.S. Global Hawk drone in June.

With the U.S balking over the Exxon/Petrochina big deal, Iraqi Prime Minster Adel Abdul Mahdi signed the new one with China in October. Mahdi brought up the circumstances surrounding that in Iraqi parliaments during the session in which it passed the resolution recommending removal of all foreign forces from Iraq.

Did Trump openly threaten Mahdi over this deal as I covered in my podcast on this? Did the U.S. gin up protests in Baghdad, amplifying unrest over growing Iranian influence in the country?

And, if not, were these threats simply implied or carried by a minion (Pompeo, Esper, a diplomat)? Because the U.S.’s history of regime change operations is well documented. Well understood color revolution tactics used successfully in places like Ukraine, where snipers were deployed to shoot protesters and police alike to foment violence between them at the opportune time were on display in Baghdad.

Mahdi openly accused Trump of threatening him, but that sounds more like Mahdi using the current impeachment script to invoke the sinister side of Trump and sell his case.

It’s not that I don’t think Trump capable of that kind of threat, I just don’t think he’s stupid enough to voice it on an open call. Donald Trump is capable of many impulsive things, openly threatening to remove an elected Prime Minister on a recorded line is not one of them.

Mahdi has been under the U.S.’s fire since he came to power in late 2018. He was the man who refused Trump during Trump’s impromptu Christmas visit to Iraq in 2018, refusing to be summoned to a clandestine meeting at the U.S. embassy rather than Trump visit him as a head of state, an equal.

He was the man who declared the Iraqi air space closed after Israeli air attacks on Popular Mobilization Force (PMF) positions in September.

And he’s the person, at the same time, being asked by Trump to act as a mediator between Saudi Arabia and Iran in peace talks for Yemen.

So, the more we look at this situation the more it is clear that Abdul Madhi, the first Iraqi prime minister since the 2003 U.S. invasion push for more Iraqi sovereignty, is emerging as the pivotal figure in what led up to the attack on General Soleimani and what comes after Iran’s subsequent retaliation.

It’s clear that Trump doesn’t want to fight a war with Iran in Iran. He wants them to acquiesce to his unreasonable demands and begin negotiating a new nuclear deal which definitively stops the possibility of Iran developing a nuclear weapon, and as Patrick Henningsen at 21st Century Wire thinks,

Trump now wants a new deal which features a prohibition on Iran’s medium range missiles, and after events this week, it’s obvious why. Wednesday’s missile strike by Iran demonstrates that the US can no longer operate in the region so long as Iran has the ability to extend its own deterrence envelope westwards to Syria, Israel, and southwards to the Arabian Peninsula, and that includes all US military installations located within that radius.

Iraq doesn’t want to be that battlefield. And Iran sent the message with those two missile strikes that the U.S. presence in Iraq is unsustainable and that any thought of retreating to the autonomous Kurdish region around the air base at Erbil is also a non-starter.

The big question, after this attack, is whether U.S. air defenses around the Ain al Assad airbase west of Ramadi were active or not. If they were then Trump’s standing down after the air strikes signals what Patrick suggests, a new Middle East in the making.

If they were not turned on then the next question is why? To allow Iran to save face after Trump screwed up murdering Soleimani?

I’m not capable of believing such Q-tard drivel at this point. It’s far more likely that the spectre of Russian electronics warfare and radar evasion is lurking in the subtext of this story and the U.S. truly now finds itself after a second example of Iranian missile technology in a nascent 360 degree war in the region.

It means that Iran’s threats against the cities of Haifa and Dubai were real.

In short, it means the future of the U.S. presence in Iraq now measures in months not years.

Because both China and Russia stand to gain ground with a newly-united Shi’ite Iraqi population. Mahdi is now courting Russia to sell him S-300 missile defense systems to allow him to enforce his demands about Iraqi airspace.

Moqtada al-Sadr is mobilizing his Madhi Army to oust the U.S. from Iraq. Iraq is key to the U.S. presence in the region. Without Iraq the U.S. position in Syria is unsustainable.

If the U.S. tries to retreat to Kurdish territory and push again for Masoud Barzani and his Peshmerga forces to declare independence Turkish President Recep Tayyip Erdogan will go ballistic.

And you can expect him to make good on his threat to close the Incerlik airbase, another critical logistical juncture for U.S. force projection in the region.

But it all starts with Mahdi’s and Iraq’s moves in the coming weeks. But, with Trump rightly backing down from escalating things further and not following through on his outlandish threats against Iran, it may be we’re nearing the end of this intractable standoff.

Back in June I told you that Iran had the ability to fight asymmetrically against the U.S., not through direct military confrontation but through the after-effects of a brief, yet violent period of war in which all U.S., Israeli and Arab assets in the Middle East come under fire from all directions.

It sent this same message then that by attacking oil tankers it could make the transport of oil untenable and not insurable. We got a taste of it back then and Trump, then, backed down.

And the resultant upheaval in the financial markets creating an abyss of losses, cross-asset defaults, bank failures and government collapses.

Trump has no real option now but to negotiate while Iraq puts domestic pressure on him to leave and Russia/China come in to provide critical economic and military support to assist Mahdi rally his country back towards some semblance of sovereignty

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Tyler Durden

Sun, 01/12/2020 – 07:00

via ZeroHedge News https://ift.tt/2Nis7tO Tyler Durden