InsideSources

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

Energy

The logic in exporting U.S. oil
WASHINGTON POST
Robert J. Samuelson
Explaining this persuasively in public is difficult, maybe impossible. It’s complicated. It requires showing why the long-run consequences of an export ban (less oil and higher prices) might be different from the short-run consequences (an artificial glut in the United States and lower U.S. prices), which would be temporary. It’s far easier to denounce oil producers as greedy and to argue that selling U.S. oil to foreigners is an unpatriotic act that will hurt the poor and middle class. These sound bites resonate; sleep-inducing analyses don’t.

Any vote on oil exports is fraught with political peril
HOUSTON CHRONICLE (Subscribe)
Jennifer A. Dlouhy
The real debate over exporting oil won’t play out in the nation’s capital but rather in town halls and political gatherings around the country, as lawmakers encounter voters worried that selling crude overseas will spike gasoline prices at home.

EPA not planning new oil, gas methane rules for now
POLITICOPRO (Subscribe)
Erica Martinson
EPA is not planning to expand its air emissions rules for refineries to directly regulate methane, though the agency is considering various other “tools” to address methane from the oil and gas sector as part of the president’s climate action plan, EPA Administrator Gina McCarthy said Friday.

Shale, Saudi Arabia and Islamic State Leave Oil Bulls Sweating
WALL STREET JOURNAL
Liam Denning
There was a time when headlines about jets bombing Middle Eastern refineries would have sent oil prices soaring. Granted, Islamic State’s facilities aren’t exactly world class. But it is telling that such violence is doing little to lift the price of crude. Brent is down 13% this year and looks set to post its weakest yearly average price since 2010, before the Arab Spring really got going. The big culprit for this disconnect is shale. U.S.-led growth in oil output from the industrialized world since the start of 2011 offsets supply disruptions in the Organization of the Petroleum Exporting Countries, according to Citigroup.

Why Peak-Oil Predictions Haven’t Come True
WALL STREET JOURNAL
Russell Gold
To the peak-oil adherents, this is just a respite, and decline is inevitable. But a growing tide of oil-industry experts argue that peak oil looks at the situation in the wrong way. The real constraints we face are technological and economic, they say. We’re limited not by the amount of oil in the ground, but by how inventive we are about reaching new sources of fuel and how much we’re willing to pay to get at it.

Dark side of the boom
WASHINGTON POST
Sari Horwitz
In just five years, the Bakken formation in North Dakota has gone from producing about 200,000 barrels to 1.1 million barrels of oil a day, making North Dakota the No. 2 oil-producing state, behind Texas, and luring thousands of workers from around the country. But there is a dark side to the multibillion-dollar boom in the oil fields, which stretch across western North Dakota into Montana and part of Canada. The arrival of highly paid oil workers living in sprawling “man camps” with limited spending opportunities has led to a crime wave — including murders, aggravated assaults, rapes, human trafficking and robberies — fueled by a huge market for illegal drugs, primarily heroin and methamphetamine.

Obama faces hard sell on climate fund
THE HILL
Timothy Cama
President Obama is facing international pressure to contribute to a $100 billion-a-year fund to help poor countries deal with climate change, but Republicans are likely to stand in the way, endangering his efforts on a key legacy issue.

Elon Musk Scores Again
WALL STREET JOURNAL
Editorial
Fresh from his $1.3 billion subsidy score in Nevada, billionaire Elon Musk hit it big again last week. New York Governor Andrew Cuomo announced free public housing and $750 million in government assistance for Mr. Musk’s unprofitable SolarCity. … So Mr. Cuomo continues to ban natural gas fracking, which requires no subsidies and would increase jobs and tax revenue, yet he ponies up cash for a green-energy company that makes no money even with subsidies. Thus do liberals help the rich get richer.

Technology

With Perspective From Both Sides of His Desk, F.C.C. Chairman Ponders Net Neutrality
NEW YORK TIMES
Edward Wyatt
As a lobbyist for the cable and wireless industries, Tom Wheeler played a role in shaping almost every major telecommunications policy and innovation over the last three decades. Cable and telephone deregulation. Internet service in schools and libraries. C-SPAN. None of them, though, have generated as much public interest as net neutrality, the policy most likely to define his time as chairman of the Federal Communications Commission.

INFLUENCE GAME: Government Takes on the Internet
ASSOCIATED PRESS
Anne Flaherty
Should the company that supplies your Internet access be allowed to cut deals with online services such as Netflix, Amazon or YouTube to move their content faster?

Growling by Comcast May Bring Tighter Leash
NEW YORK TIMES
David Carr
Comcast has a long corporate tradition of smiling and wearing beige no matter what kind of criticisms are hurled at it. That public posture is in keeping with the low-key approach favored by Brian L. Roberts, the company’s chief executive, as he seeks to take over the world. It’s worked very well so far. But in a filing submitted to the Federal Communications Commission last week in defense of its proposed merger with Time Warner Cable, the company lashed out uncharacteristically at its critics.

Spy Agencies Urge Caution on Phone Deal
NEW YORK TIMES
Eric Lichtblau
An obscure federal contract for a company charged with routing millions of phone calls and text messages in the United States has prompted an unusual lobbying battle in which intelligence officials are arguing that the nation’s surveillance secrets could be at risk. The contractor that wins the bid would essentially act as the air traffic controller for the nation’s phone system, which is run by private companies but is essentially overseen by the government.

Finance

Survey: ATM, checking overdraft fees surge
ASSOCIATED PRESS
Alex Beiga
Banks are reaping bigger fees whenever customers overdraw their checking accounts or use ATMs that are not affiliated with their lender, a new survey shows. The average fee for using an out-of-network ATM climbed 5% the past year to a new high of $4.35 per transaction, according to a survey released Monday by Bankrate.com. Overdraft fees also surged, rising on average the past 12 months to $32.74. That’s the 16th consecutive record high, the firm said.

Secret Goldman Sachs tapes show regulators still respect bankers too much
WASHINGTON POST
Matt O’Brien
Regulators knew the big banks were taking big risks, and had the power to do something about it. But they didn’t. It’s worse than outright neglect, since it’s not as obvious how to fix it. And now, thanks to 46 hours of secret audio tapes from inside the New York Federal Reserve, we can hear that they’re still having trouble fixing it. The problem isn’t that regulators don’t have the tools they need. It’s that they won’t use the tools they have, because they respect the bankers too much.

Fed Questions Bank Maneuver to Reduce Hedge Funds’ Dividend Taxes
WALL STREET JOURNAL
Jenny Strasburg
Large banks generate more than $1 billion a year in revenue by helping hedge funds and other clients reduce taxes through a complicated trading strategy that has drawn criticism from U.S. authorities. Known as “dividend arbitrage,” the strategy is run largely from London, where the banks temporarily transfer ownership of a client’s shares to a lower-tax jurisdiction around the time when the client expects to collect a dividend on those shares, according to people familiar with the matter.

When Central Bankers Become Central Planners
WALL STREET JOURNAL
Paul H. Kupiec
Government regulators are no better than private investors at predicting which individual investments are justified and which are folly. The cost of macroprudential regulation in the name of financial stability is almost certainly even slower economic growth than the anemic recovery has so far yielded.

Finally, the Truth About the A.I.G. Bailout
NEW YORK TIMES
Noam Scheiber
And yet, as asinine as the Starr suit may be in legal terms, it may end up serving a constructive purpose. Among Starr’s key claims is that a chunk of the roughly $180 billion the government eventually poured into A.I.G. was unnecessary, at least if the point was to save the insurance giant. In practice, tens of billions went out the door to other financial institutions, like Goldman Sachs and Deutsche Bank, whose risky mortgage securities A.I.G. had foolishly insured in the run-up to the crisis.

Geneva Report warns record debt and slow growth point to crisis
FINANCIAL TIMES (Subscribe)
Chris Giles
A “poisonous combination” of record debt and slowing growth suggest the global economy could be heading for another crisis, a hard-hitting report will warn on Monday. The 16th annual Geneva Report, commissioned by the International Centre for Monetary and Banking Studies and written by a panel of senior economists including three former senior central bankers, predicts interest rates across the world will have to stay low for a “very, very long” time to enable households, companies and governments to service their debts and avoid another crash.

Pimco ‘bond king’ resigns: abdication or coup?
FINANCIAL TIMES (Subscribe)
Madison Marriage
The startling departure raises two important questions: Is Pimco better off without Mr Gross? And is Janus better off with him on board, despite his tarnished reputation?

Politics

Obama: U.S. misjudged the rise of the Islamic State, ability of Iraqi army
WASHINGTON POST
Sebastian Payne
On CBS’s “60 Minutes,” correspondent Steve Kroft referred to comments by James R. Clapper Jr., the director of national intelligence, in which he said, “We overestimated the ability and the will of our allies, the Iraqi army, to fight.” “That’s true. That’s absolutely true,” Obama said. “Jim Clapper has acknowledged that I think they underestimated what had been taking place in Syria.”

Poll: 70% of troops say no boots on ground in Iraq
MILITARY TIMES
As the tide of war rises again in the Middle East, the military’s rank and file are mostly opposed to expanding the new mission in Iraq and Syria to include sending a large number of U.S. ground troops into combat, according to a Military Times survey of active-duty members.

Confirmation battles are back
POLITICO
Burgess Everett
If Republicans capture the Senate majority in November, their sway over prominent judgeships and Cabinet vacancies — potentially including a new attorney general — will become one of the GOP’s primary leverage points against President Barack Obama. But first the GOP must decide whether to adopt Senate Democrats’ bellicose tactic to allow approval of most executive branch nominees by a simple majority vote. The rules change to the filibuster was implemented by Senate Majority Leader Harry Reid (D-Nev.), but it could now come back to bite him.

Debt fades as election issue
THE HILL
Rebecca Shabad
Republicans in tough races aren’t making cuts to government spending and deficit reduction a central part of their campaign messaging—a striking contrast from the 2010 midterms race. … “Everybody is just not talking about it,” said Steve Bell, senior director of economic policy at the Bipartisan Policy Center.

GOP bets on regulations backlash
THE HILL
Benjamin Goad
“Over-regulation is always a good message for us,” said Republican National Committee spokeswoman Kirsten Kukowski. “Regulation is another word for something that comes between you and a job. Regulations make your paychecks smaller — because someone has to pay for them.” A June survey conducted by Republican pollster McLaughlin and Associates found that nearly three-quarters of voters believe Congress should review the federal rulemaking process and withhold funding in order to block the “hidden taxes” passed on to consumers. More than two-thirds of voters approved of a freeze on new regulations, according to the online survey of 1,000 likely voters that was commissioned by the group Regulation Watch.

The Tide of the Culture War Shifts
NEW YORK TIMES
Editorial
For a younger generation of voters, the old right-wing nostrums about the “sanctity of life” and the “sanctity of marriage” have lost their power, revealed as intrusions on human freedom. Democrats “did win the culture war,” Alex Castellanos, a Republican strategist, admitted to The New York Times recently.

House Hopefuls in G.O.P. Seek Rightward Shift
NEW YORK TIMES
Jonathan Weisman
Congressional Republicans successfully ended their primary season with minimal damage, but in at least a dozen safe or largely safe Republican House districts where more mild-mannered Republicans are exiting, their likely replacements will pull the party to the right, a move likely to increase division in an already polarized Congress.

Fumbled Bid for Governor Imperils Ohio Democrats
NEW YORK TIMES
Trip Gabriel
With a wounded candidate at the top of their ticket, Democrats in Ohio have been forced to adopt a Plan B as they seek to avoid a disastrous shutout in elections for governor and other statewide offices. “Voting from the bottom to the top: That is the way we need to roll this year,” said Nina Turner, a candidate for secretary of state. Translation: Ignore the contest for governor and concentrate on the down-ballot races for the five other statewide offices, where Democrats are challenging Republican incumbents.

Greg Orman, a political enigma, faces growing scrutiny in Kansas Senate race
WASHINGTON POST
Philip Rucker
But not having a party also liberates Orman from taking positions — especially on controversial issues that might alienate partisans. Greenlight the Keystone XL pipeline? Orman said he doesn’t have enough information to say yes or no. What about gun control? He said gun restrictions should be “strengthened” but would not specify whether he backs an assault-weapons ban. And on the biggest question of all — Would he caucus with Democrats or Republicans? — Orman insists he’s not sure.