Your daily briefing of the top news in energy, tech, finance, and politics.
Energy
Oil price swoon may be political boon for energy industry
POLITICOPRO (Subscribe)
Elana Schor
The incoming Congress was already going to look favorably upon the industry’s agenda, but the decline in U.S. oil prices below $70 a barrel from a summertime high above $105 gives oil companies a new opening to tout their own potential pain at the hands of OPEC. The price drop makes the GOP’s energy agenda “more important than ever,” Sen. John Hoeven (R-N.D.) said in an interview Tuesday. “It requires our energy industry to be even more efficient, and a legal, tax and regulatory environment that provides certainty,” Hoeven said.
Who’s Afraid of Cheap Oil?
WALL STREET JOURNAL
Holman W. Jenkins, Jr.
Saudi versus shale? That’s been the theme of countless stories on the business wires in recent months. The case is overstated. The Saudis aren’t stupid. They can’t kill America’s shale revolution and it’s pointless to try.
Falling oil prices hit Russia much harder than Western sanctions
WASHINGTON POST
Michael Birnbaum
Nine months into the worst relations between the West and Russia since the Cold War, the plunging price of oil is causing deeper and swifter pain than the Western sanctions that have targeted key areas of Russia’s economy. Russian leaders said Tuesday for the first time that their economy will head into recession next year. In a nation where oil and gas exports largely determine the bottom line, lawmakers are slashing spending promises. And the ruble is hitting historic lows every day.
The Next Big Climate Question: Will India Follow China?
NEW YORK TIMES
Michael Greenstone
One critical question now is whether India — the country that has stood by China’s side in climate talks and is now the world’s third-largest emitter — will follow suit in a meaningful way at the Lima negotiations. And there seems to be a surprisingly high chance that India will.
Technology
Comcast critics unite to oppose TWC merger
POLITICOPRO (Subscribe)
Alex Byers
DISH Network and advocacy group Public Knowledge are among those behind the bluntly named “Stop Mega-Comcast Coalition,” which is launching with 16 members Wednesday. The group argues the $45 billion deal combining the nation’s two largest cable companies will harm competition in everything from high-speed broadband service to local advertising.
Apple iPod Antitrust Trial Gets Under Way
WALL STREET JOURNAL
Jeff Elder
Steve Jobs helped usher in new ways to listen to music with the iPod. But did the late Apple Inc. co-founder also guide his company to violate antitrust laws and hurt consumers by updating the device to prevent it from playing songs from other companies’ music stores? That question is now being argued in court in a decade-old class-action lawsuit seeking $350 million in damages for consumers and businesses, who contend Apple’s actions forced them to pay more for iPods. The damages could be tripled under antitrust laws.
Amazon’s Jeff Bezos Explains Why He Bought The Washington Post
NEW YORK TIMES
Mike Isaac
But Mr. Bezos was ultimately convinced that The Post, which he called a national institution, can be brought into the digital age by leveraging the technical expertise and knowledge that he has gained over his decades spent building Amazon into a global technology company. “I didn’t know anything about the newspaper business, but I did know something about the Internet,” Mr. Bezos said. “That, combined with the financial runway that I can provide, is the reason why I bought The Post.”
Facebook doesn’t transform free speech into a lesser right
WASHINGTON POST
Editorial
Yet the government opposes even having to show recklessness on the part of a speaker in order to imprison him. “That’s not the kind of standard that we typically use in the First Amendment,” Justice Elena Kagan said Monday. “We typically say that the First Amendment requires a kind of buffer zone to ensure that even stuff that is wrongful maybe is permitted because we don’t want to chill innocent behavior.” The court must keep that principle in mind — not for Mr. Elonis’s sake but for the sake of those who might stop speaking out of fear that a prosecutor and jury somewhere will disapprove of what they have to say.
Finance
Banker blowback
POLITICO
Ben White
In a sign of their increased determination to shape both the national debate and the future of the Democratic party, top liberals are coalescing around a campaign to derail President Barack Obama’s nominee of a top Wall Street investment banker for a senior administration job, setting up a showdown with moderates of their own party.
Liberals turn to Fed in populist economic push
THE HILL
Peter Schroeder
Left-leaning groups and lawmakers are taking their populist economic fight to the Federal Reserve, as they seek to exert new influence over key monetary decisions and a pair of vacancies at the central bank. The Fed has faced heavy criticism from the right for years, but the other side of the aisle is now beginning to publicly push the institution for preferred policies. With Congress and the White House seemingly set to butt heads for the next two years, left-leaning community and labor groups are turning to the Fed in an attempt to get an economic policy boost for middle- and working-class Americans.
Playing the Dodd-Frank Shaming Game
WALL STREET JOURNAL
Avrohom J. Kess and Yafit Cohn
In 2015 the Securities and Exchange Commission is expected to finalize a new rule that imposes excessive compliance costs on public companies with no discernible benefits to investors. The rule requires that public companies calculate and disclose the ratio of the CEO’s pay to the median annual total compensation of all company employees. Part of the 2010 Dodd-Frank law, this ill-advised rule clearly advances the agenda of interest groups worried about income inequality, politicizes the SEC’s disclosure regime and is inconsistent with the purpose of federal securities laws.
Fed’s Fischer: Decisions on Rates Remain Data-Driven
WALL STREET JOURNAL
Jeffrey Sparshott
“If the labor market continues to strengthen, and if we see some signs of inflation beginning to increase, then the natural thing is to get the interest rates up,” Mr. Fischer said at The Wall Street Journal CEO Council annual meeting. “And we call it normalization,” he said, adding near-zero interest rates that have been in place for several years are far from normal.
Public Pensions Need Gamblers Anonymous
WALL STREET JOURNAL
Andrew G. Biggs
State and local pension plans invest roughly twice as much in risky assets as would a prudent individual saving for retirement. Indeed, the Society of Actuaries, which represents the actuarial profession, recently pointed to public-pension investment practices “that go against basic risk management principles.” With $3.7 trillion on the line, risk-addicted pensions need an intervention. The question is who can do it.
Politics
Can a wonk run a war?
POLITICO
Michael Crowley
A bona fide scholar whose pursuits have ranged from the monks of 12th century Flanders to quark theory to nuclear terrorism, Carter has surely earned his self-confidence. But as he prepares for the top military job amid uncertainty in Iraq and Syria, the question is whether a wonk is what America needs in wartime.
A Technocrat for Defense
WALL STREET JOURNAL
Editorial
We trust Mr. Carter will make clear before he takes the job that, while he answers to the President, he needs enough authority to run the Pentagon. Mr. Carter will be lucky if Mr. Obama is finally figuring out that he needs some grown-up foreign-policy advisers if he is to salvage his legacy. And as Mr. Obama’s fourth Defense Secretary, he’ll also be all-but unfireable.
The 113th Congress seems content to slink away with a tenuous of partisan truce
WASHINGTON POST
Editorial
Instead of actually using the lame-duck session to advance politically risky but necessary causes, such as cleaning up the tax code, as some had dared to hope, this Congress seems content to slink away from Washington having declared the most tenuous of partisan truces.
Mitch McConnell, Paul Ryan Chart GOP Agenda
WALL STREET JOURNAL
Damian Paletta
GOP congressional leaders said they plan to pursue targeted agreements with the White House on tax and trade policy next year, but they played down prospects for more sweeping measures in part because of fractured relations between both sides. The Republican lawmakers also suggested there would be little likelihood of showdowns with the Obama administration on spending or the debt ceiling, with incoming Senate Majority Leader Mitch McConnell (R., Ky.) saying there wouldn’t be a government shutdown or default on the U.S. debt.
Long-term tax-break plan fizzles, along with hopes of some bipartisanship in Congress
WASHINGTON POST
Lori Montgomery
Under the proposal, set for a vote Wednesday in the House, millions of businesses and individual taxpayers would be able to claim long-standing deductions and credits worth $45 billion on their 2014 tax returns. But those perks would expire again Dec. 31, leaving lawmakers to squabble afresh over the matter in the new year. That outcome favors no one. Democrats would lose a chance to expand favored tax breaks before ceding control of the Senate, and Republicans would have to revisit an issue they had hoped to settle before taking charge. Business leaders, who have been lobbying aggressively to revive and expand a credit for research and development, among other provisions, rolled their eyes Tuesday.
Uncertainty in Washington Poses Long List of Economic Perils
NEW YORK TIMES
Jonathan Weisman
Absent congressional action, a host of business and personal tax breaks expires on Jan. 1. The government’s borrowing limit is reinstated on March 16, although the government might not actually hit the ceiling until August. On March 28, unless lawmakers act, physician reimbursements from Medicare drop off a cliff. On May 31, the highway trust fund runs out of money. In June, the Export-Import Bank, which helps finance overseas purchases of American exports, might shut in the face of conservative opposition to its mission. Then on Sept. 30, the entire Children’s Health Insurance Program faces its expiration. A few days later, across-the-board spending cuts loom once again.
Letting Tax ‘Extenders’ Die
WALL STREET JOURNAL
Editorial
President Obama doesn’t do many favors for Republicans, but last week he did them an inadvertent one when he threatened to veto a $450 billion package of special-interest tax provisions that the GOP leadership had negotiated with Harry Reid. Now they have a chance to kill the entire project in favor of going for corporate tax reform next year.
What tax extenders cost you
USA TODAY
Editorial
Instead of simplifying the maddeningly complicated tax code, Congress instead is spending its time extending more than 50 mostly special-interest tax breaks for such worthies as owners of thoroughbred horses and NASCAR racetracks. And rather than find ways to pay for the almost $45 billion, 10-year cost of these tax breaks — as Congress’ own rules require — Democrats and Republicans alike are simply adding to the national debt by borrowing the money.
Most ‘extenders’ are good policy
USA TODAY
Grover Norquist
Making the pro-growth extenders permanent will give businesses certainty in planning investment, avoid the loss of jobs and growth that higher taxes would bring, and end the political game of holding temporary tax hikes hostage. Politicians should not raise taxes as part of a return to honest accounting and an end to playing games with the tax code.
The media circus around Ferguson
WASHINGTON POST
Kathleen Parker
The media may not have caused events to spiral out of control in Ferguson and, to be fair, Sharpton may well have a legitimate role in shining a light on racial injustice. But when activists posing as journalists have television shows through which they stoke passions — and when certain media decide to magnify issues not in the name of justice but, let’s face it, for ratings — then journalism has a problem.
Hundreds of Police Killings Are Uncounted in Federal Stats
WALL STREET JOURNAL
Rob Barry and Coulter Jones
A Wall Street Journal analysis of the latest data from 105 of the country’s largest police agencies found more than 550 police killings during those years were missing from the national tally or, in a few dozen cases, not attributed to the agency involved. The result: It is nearly impossible to determine how many people are killed by the police each year.
Internal GOP Tensions Simmer Over Terrorism Insurance
NATIONAL JOURNAL
Billy House
House and Senate negotiators remained at an impasse Tuesday on a deal to reauthorize a terrorism-risk insurance program, amid frustration within the House GOP conference and from business groups over the lack of movement. Tensions bubbled again in a closed-door meeting of House Republicans, even as party leaders were preparing to take fallback action with a short-term reauthorization bill for the Terrorism Risk Insurance Act, or TRIA, by the end of this lame-duck session.
