InsideSources

Your daily briefing for all the top news in Energy, Technology, Finance, and Politics.

Energy

Obama opens rift with greens
THE HILL
Laura Barron-Lopez
President Obama is moving toward opening the Atlantic Ocean to drilling, a major shift in U.S. policy that cuts against the administration’s efforts to reduce global warming. Environmental groups applauding the president’s pursuit of new power plant rules meant to reduce climate change are now preparing for a major battle over authorizing drilling in the Atlantic, and possibly the Arctic and Pacific Oceans.

Renouncing Partnership Structure, Kinder Morgan to Reorganize as Single Corporation
NEW YORK TIMES
David Gelles
In recent years, master limited partnerships have become an increasingly popular — and lucrative — structure for oil and gas companies. They pay no corporate taxes and distribute all profits to shareholders, making them a hit with investors. But on Sunday, the biggest M.L.P. of them all announced it was disbanding the unique structure and reorganizing into a traditional corporation. Kinder Morgan, which encompasses a huge network of oil and gas pipelines across North America, will acquire its three associated companies and reorganize as one corporation based in Houston.

In U.S. Energy Boom, Alaska Is Unlikely Loser
WALL STREET JOURNAL
Cassandra Sweet and Jim Carlton
The energy boom sweeping North America is producing an unexpected loser: Alaska. The state, which staked most of its economy on energy in the 1970s after oil was found on the North Slope, is now competing with, and often losing out to, places with hotter oil fields—especially North Dakota. More people left Alaska than settled in the state between 2012 and 2013, while North Dakota added residents, according to state and federal census data. North Dakota surpassed Alaska two years ago as the nation’s second-largest oil producer, behind Texas.

Study: Keystone Carbon Pollution More Than Figured
ASSOCIATED PRESS
Seth Borenstein
The much-debated Keystone XL pipeline could produce four times more global warming pollution than the State Department calculated earlier this year, a new study concludes. The U.S. estimates didn’t take into account that the added oil from the pipeline would drop prices by about $3 a barrel, spurring consumption that would create more pollution, the researchers said. Outside experts not connected to the study gave it mixed reviews. The American Petroleum Institute found the study to be irrelevant because regardless of the pipeline, the tar sands will be developed and oil will be shipped by railroad if not by pipeline, spokeswoman Sabrina Fang said.

North Dakota Considers Requiring Treatment of Bakken Crude
WALL STREET JOURNAL
Chester Dawson
North Dakota officials are considering requiring energy companies to treat the crude they pump from the Bakken Shale to make it less volatile before it is loaded onto trains.

Technology

Ride-sharing firms and Va. find common ground
WASHINGTON POST
Editorial
The logic of encouraging the ride-sharing industry is clear: As anyone who has tried to hail a cab in the rain or at rush hour can attest, taxis are too few and too unreliable to satisfy demand in Washington, as in many other cities. In cities where taxi prices are prohibitive, the new services provide an alternative for passengers, some of whom may have no access to public transit to get to and from work. Moreover, if ride-sharing companies can offer an attractive and economical alternative to car ownership — which is precisely what they aspire to do — they could induce some people to give up their cars, which would make a dent in traffic and pollution.

FCC chief frowns on Verizon’s slowing speeds
THE HILL
Julian Hattem
Verizon’s explanation for why it slows some users’ data speeds during peak hours isn’t flying with Federal Communications Commission Chairman Tom Wheeler. “’All the kids do it’ was never something that worked with me when I was growing up and it didn’t work with my kids,” Wheeler told reporters on Friday.

Judge Rejects Settlement in Silicon Valley Wage Case
WALL STREET JOURNAL
Jeff Elder
A federal judge on Friday rejected as too small a proposed $324.5 million settlement in a closely watched case alleging that four big Silicon Valley companies colluded not to hire each other’s employees, driving down wages for five years.

Finance

Big banks take millions from tax credit designed to help poor, report says
WASHINGTON TIMES
Stephen Dinan
Big banks are claiming hundreds of millions of dollars in tax credits the federal government intended to go to poor communities, according to a new report being released Monday by Sen. Tom Coburn. The New Markets Tax Credit, created by a Republican Congress and signed into law by then-President Clinton, was supposed to entice banks to help finance projects in low-income communities. But instead, banks have claimed the credit for everything from drive-in movie theaters to luxury hotels, Mr. Coburn, Oklahoma Republican and Congress’s top waste-watcher, says in the report.

Too Big to Regulate
NEW YORK TIMES
Editorial
In their current form, the big banks are too big to fail. That’s why the law requires them to either write acceptable living wills or be downsized. But they haven’t done the former or faced the latter. That means they are still free to take outsized risks — and to enjoy the big paydays associated with those risks — secure in the knowledge that they will be bailed out if those risks blow up.

Bank of America faces a hefty fine, but ‘too big to fail’ still threatens
WASHINGTON POST
Editorial
The regulators’ rejection of the living wills was not unexpected, and the banks have a year to fix them. Still, it reminded banks of the need to simplify their businesses and keep leverage to manageable levels, a warning they’ll heed if they want to avoid more drastic shrinkage at the hands of regulators or Congress.

Calpers Rethinks Its Risky Investments
WALL STREET JOURNAL
Dan Fitzpatrick
The largest U.S. public pension plan is considering a dramatic retreat from some riskier investments, as it tries to simplify its $295 billion in holdings and better protect against losses during the next market downturn, according to people familiar with the matter. California Public Employees’ Retirement System is weighing whether to exit or substantially reduce bets on commodities, actively managed company stocks and hedge funds, the people said.

Interest rates and the Fed’s great ‘slack’ debate
WASHINGTON POST
Robert Samuelson
Call it the great “slack” debate. For nearly six years, the Federal Reserve has held short-term interest rates near zero to boost the economy. Is it time to consider raising rates to preempt higher inflation? The answer depends heavily on the economy’s slack: its capacity to increase production without triggering price pressures. Although economists are arguing furiously over this, there’s no scientific way to measure slack. Economic policymaking is often an exercise in educated guesswork, built on imperfect statistics, shaky assumptions, incomplete theories and political preferences. This is an instructive case in point.

A Corporate Tax Break That’s Closer to Home
NEW YORK TIMES
Gretchen Morgenson
Some in Congress have proposed legislation to shut the door on this tax-savings tactic [inversions]. But across town at the Internal Revenue Service, officials have recently opened the window to another. They did so in a ruling disclosed late last month by Windstream Holdings, a telecommunications company based in Little Rock, Ark. The ruling allows Windstream to spin off its copper and fiber network into a real estate investment trust, or REIT. That sounds pretty ho-hum until you realize it means that Windstream won’t have to pay hundreds of millions of dollars in taxes.

Politics

Democrats on the Obama Doctrine
WALL STREET JOURNAL
Editorial
The latest reviews of Barack Obama’s foreign policy are in, and flattering they are not. “Just leaves you scratching your head,” says one, about the President’s rationale for providing limited support to the Kurds in Iraq. “Nothing we can point to that’s been very successful,” says another about the President’s policy in Syria. And then there’s this zinger: “Great nations need organizing principles, and ‘Don’t do stupid stuff’ is not an organizing principle.” In case you are wondering which trio of neoconservative naysayers we’re quoting here, we refer you, respectively, to James Steinberg, formerly the President’s Deputy Secretary of State, and Robert Ford, formerly his Ambassador to Syria, and Hillary Rodham Clinton, formerly his loyal Secretary of State.

Ending presidents’ second-term curse
WASHINGTON POST
Larry Summers
Disillusionment with Washington has rarely run higher. Congress is unable to act even in areas where there is widespread agreement that measures are necessary, such as immigration, infrastructure spending and business tax reform. The Obama administration, rightly or wrongly, is increasingly condemned as ineffectual. … Second presidential terms are almost without exception very difficult for the president and his team, for the government and for the country.

Democrats’ 2014 strategy: Run like a Republican
POLITICO
Alex Isenstadt
Faced with a treacherous political environment, many Democrats are trotting out campaign ads that call for balanced budgets, tax cuts and other more traditionally GOP positions. Some of them are running in congressional districts that just two years ago broke sharply for President Barack Obama. The Republican-flavored ads provide an early glimpse of how Democrats will wage their 2014 campaign.

Midterms Give Parties Chance for Sweeping Control of States
NEW YORK TIMES
Adam Nagourney
At a time when Democrats and Republicans in control of statehouses are using their authority to push through ambitious policies that by contrast highlight the paralysis in Washington, the potential for further Republican gains has raised the possibility of deepening the policy divide between red and blue states. Republicans now control 59 of the 99 partisan legislative chambers, and have complete political control — both legislative houses and the governor’s mansion — in 23 states, while Democrats control 13. The total number of states ruled by a single political party, 36, is the highest in six decades. Officials from both parties say there are two states that the Republicans might be able to add to the list of places where they enjoy complete control — Iowa and Arkansas. (There are no similar opportunities for Democrats.)

Republican takeover of Senate appears more and more assured
WASHINGTON POST
Chris Cillizza
These past seven days typified the fates of the two parties this election cycle. Democrats have been hit by retirements in tough states — Montana, West Virginia, South Dakota and, to a lesser extent, Iowa — and Republicans haven’t nominated the sort of extreme candidates who lack broader appeal in a general election.

GOP Ads Go On Attack Over Border
WALL STREET JOURNAL
Beth Reinhard
New television ads by Republican Senate candidates in Arkansas and New Hampshire blame the recent surge of illegal immigration on Democratic support for “amnesty.” And in Maine, Republican Gov. Paul LePage is bashing his Democratic challenger for supporting government welfare for illegal immigrants. The current immigration crisis is reaching parts of the campaign trail closer to the Canadian border than Mexico’s. Republicans cite the arrival of tens of thousands of unaccompanied Central American children in recent months to argue that Democrats are supporting bad immigration policy. A recent Wall Street Journal/NBC News poll found 64% disapprove of the U.S. response to the border crossings.

GOP ads aim locally, Democrats nationally
WASHINGTON TIMES
David Sherfinski
In races from Alaska to North Carolina, Democrats are focusing their advertising on locally tailored messages like energy, jobs and manufacturing. Republicans, though, are using their television cash to focus on the national debate, hammering home broad critiques of Mr. Obama and his policies, notably Obamacare.

Hawaiian Governor Loses Primary by Wide Margin; Senate Race Is Undecided
NEW YORK TIMES
Ian Lovett
After nearly four decades in elected office in Hawaii, Gov. Neil Abercrombie was dealt a stunning defeat in his bid for re-election, becoming the first governor in the state’s history to lose in a primary race.

Kurds need more U.S. help to defeat Islamic State
WASHINGTON POST
Masoud Barzani
Every religion, state and community must voice its support for civilization and humanity. And those countries with capacity to help — first and foremost the United States — must understand that this is an urgent danger and act accordingly. We must stop the terrorists now. With air support and military equipment, we can.