The RPSEA Rip-Off: How the Natural Gas Industry Extracted a Billion-Dollar Boondoggle from Congress

The report, "The RPSEA Rip-Off: How the Natural Gas Industry Extracted a Billion-Dollar Boondoggle from Congress," describes how companies with profits that totaled more than $100 billion in 2005 set up a taxpayer-funded subsidy establishing a 10-year,$1.5 billion research program to find ways to extract oil and gas from "ultra-deepwater" depths and hard-to-access onshore areas. American taxpayers will begin doling out about $400 million -- and possibly more than a billion dollars -- over 10 years to a research consortium that includes wealthy oil and gas companies due to a provision slipped quietly into the enormous 2005 energy bill.The Research Partnership to Secure Energy for America (RPSEA) was set up by the Gas Technology Institute (GTI), a group that was successor to another gas industry organization that had lost a dedicated source of funding from pipeline operators worth more than$200 million annually. GTI subsequently led the effort to help replace those lost funds with taxpayer dollars. The subsidy it secured is a relic of the tenure of former House Majority Leader Tom DeLay, who ensured that much of the program's money would be guaranteed without further congressional action. RPSEA and GTI established offices in DeLay's former district of Sugar Land, Texas.The report documents the law's journey to passage and illustrates what is wrong with the lawmaking process and how some of the world's richest corporations are able to foist industry research costs onto taxpayers. The measure was slipped into a conference report in the dead of night, after conferees had signed off on what they thought was a final bill. The plan incorporated the use of a non-profit consortium to make the legislation look less like a special favor for a known entity. The legislative leaders who inserted the measure were among the top recipients of campaign contributions from the members of the front group

Taking the Public Trust: How a New York Real Estate Developer Is Threatening State Governments in the West

A wealthy New York developer coordinated an $8 million campaign to enact state ballot initiatives that would eviscerate state environmental safeguards in four Western states and threaten to bankrupt the state treasuries.Organizations connected to Howie Rich have primarily funded the initiatives to allow individual landowners to claim compensation from state and local governments for any decrease in property value as a result of planning, environmental or other government protections. They will be on the ballot in four states on Election Day: Arizona (Proposition 207), California (Proposition 90), Idaho (Proposition 2) and Washington (Initiative 933).Similar initiatives were bounced -- in full or in part -- from ballots in Oklahoma and Nevada because courts there found that the structure of the initiatives violated those states' requirements that ballot initiatives embrace only a single subject. In Montana, a court found that proponents engaged in massive fraud in the petition drive to win a spot on the ballot.The campaigns falsely advertise the initiatives as necessary to prevent governments from condemning property owners' land, but they instead are intended to serve as cash cows for developers. If approved, they would leave governments with an unacceptable choice between rolling back decades of environmental protection rules -- such as those to combat sprawl, protect wetlands and preserve clean air and clean water -- or paying bounties to developers as compensation for restrictions on using their land however they please

Willful Misconduct: How Bill Frist and the Drug Lobby Covertly Bagged a Liability Shield

Drug industry lobbyists conspired with the White House and Senate Majority Leader Bill Frist (R-Tenn.) last year to craft a sweeping liability provision that shields the industry from lawsuits over products used to treat pandemic illnesses, even in cases of gross negligence or gross recklessness.This report relies on internal documents and e-mails of the Biotechnology Industry Organization (BIO) to illustrate the degree to which Frist's office deferred to drug industry demands and describes Frist's sleight of hand in securing passage of the provision. It underscores the enormous power of the drug industry and its lobbyists to steer a highly controversial provision into law.Frist inserted the shield provision into an already-completed conference report for the defense appropriations bill in the dead of night, with the aid of House Majority Leader Dennis Hastert (R-Ill.). Many of the members of the conference committee had never seen the language, let alone approved it. Committee leaders explicitly assured Democrats, made wary by rumors circulating in the preceding days, that no attempt would be made to insert the liability measure into the spending bill.The shield is unnecessary because the government now can -- and does -- indemnify drug companies in contracts, using provisions saying that the government will cover costs in excess of the companies' insurance.The pharmaceutical industry used legions of influence-peddlers to push for the measure. The industry deployed at least 158 lobbyists to influence policies relating to vaccines and pandemic preparedness in 2004 and 2005, including 84 who were previously employed by the federal government. Of those, seven were former members of Congress, two were former top health care aides to Frist and another was the son of the speaker of the House

Hardness of robust graph isomorphism, Lasserre gaps, and asymmetry of random graphs

Building on work of Cai, F\"urer, and Immerman \cite{CFI92}, we show two hardness results for the Graph Isomorphism problem. First, we show that there are pairs of nonisomorphic $n$-vertex graphs $G$ and $H$ such that any sum-of-squares (SOS) proof of nonisomorphism requires degree $\Omega(n)$. In other words, we show an $\Omega(n)$-round integrality gap for the Lasserre SDP relaxation. In fact, we show this for pairs $G$ and $H$ which are not even $(1-10^{-14})$-isomorphic. (Here we say that two $n$-vertex, $m$-edge graphs $G$ and $H$ are $\alpha$-isomorphic if there is a bijection between their vertices which preserves at least $\alpha m$ edges.) Our second result is that under the {\sc R3XOR} Hypothesis \cite{Fei02} (and also any of a class of hypotheses which generalize the {\sc R3XOR} Hypothesis), the \emph{robust} Graph Isomorphism problem is hard. I.e.\ for every $\epsilon > 0$, there is no efficient algorithm which can distinguish graph pairs which are $(1-\epsilon)$-isomorphic from pairs which are not even $(1-\epsilon_0)$-isomorphic for some universal constant $\epsilon_0$. Along the way we prove a robust asymmetry result for random graphs and hypergraphs which may be of independent interest

Establishing and managing the environmental water reserve – the interaction between different government policies

Policy to protect river ecosystems has changed rapidly in Australia and the mechanisms to both establish and manage environmental water are still evolving. Policy has moved from providing a fixed environmental target (albeit varying between years) to one in which the environment can actively participate in the market, with the possibility of better fulfilling variable water requirements. However, the inherent nature of the Sustainable Diversion Limit (SDL), established under the Water Act 2007, is that it represents a fixed allocation to the environment. This paper considers the interaction the new SDL for the Murray Darling Basin and potential issues arising from the interaction with the government buyback initiative. While both the SDL and buyback have been discussed extensively, the interaction between the two policies has received little debate. Pairing these two policy initiatives will have implications for the flexibility of an environmental water reserve (EWR) and the ability for ongoing trade between the environment and consumptive water users. Our position is that the SDL, or preferably rules based water, should reflect an absolute minimum limit on environmental water requirements, while the buyback should provide the EWR with tradable water rights with the flexibility to respond to shifts in the environmental water demand curve by providing environmental water over and above the SDL. If both a buyback and minimum flow rules are in place, the SDL will provide little additional benefits but increase administrative costs and reduce flexibility. This has significant implications for the way the SDL and buyback strategy are structured.Environmental water, water markets, instream flows, sustainable diversion limits (SDLs), Environmental Economics and Policy, Resource /Energy Economics and Policy,

Uncertainty and technical efficiency in Finnish agriculture: a state-contingent approach

In this article, we present one of the first real-world empirical applications of state-contingent production theory. Our state-contingent behavioral model allows us to analyze production under both inefficiency and uncertainty without regard to the nature of producer risk preferences. Using farm data for Finland, we estimate a flexible production model that permits substitutability between state-contingent outputs. We test empirically, and reject, an assumption that has been implicit in almost all efficiency studies conducted in the last three decades, namely that the production technology is output-cubical, i.e., that outputs are not substitutable between states of nature.state-contingent; production; uncertainty

Production Under Uncertainty: A Simulation Study

In this article we model production technology in a state-contingent framework. Our model analyzes production under uncertainty without being explicit about the nature of producer risk preferences. In our model producers’ risk preferences are captured by the risk-neutral probabilities they assign to the different states of nature. Using a state-general state-contingent specification of technology we show that rational producers who encounter the same stochastic technology can make significantly different production choices. Further, we develop an econometric methodology to estimate the risk-neutral probabilities and the parameters of stochastic technology when there are two states of nature and only one of which is observed. Finally, we simulate data based on our state-general state-contingent specification of technology. Biased estimates of the technology parameters are obtained when we apply conventional ordinary least squares (OLS) estimator on the simulated data.CES, Cobb-Douglas, OLS, output-cubical, risk-neutral, state-allocable, state-contingent