pawatercooler.com

Don’t Blame Sunoco, ConocoPhillips, Or Unions For Refinery Shutdowns

 

Second in a series on how retooled refineries can save jobs and revitalize manufacturing

“Thank you for trying to get those who should understand the urgency of energy independence, jobs, and our future…to do so.  (We are) loading up the SUV almost every day to give away household items to Neighborhood Services and friends…and preparing to relocate if necessary.  You are right… finding middle class wages here in Pennsylvania is challenging if not impossible.  The blood, sweat and tears of years planning and building our dream home only to sell it in a bad housing market is like adding salt to the wound….”

This heartbreaking message was sent by a distraught wife of a 19-year Sunoco refinery worker, as that company’s two refineries (Philadelphia and Marcus Hook) are slated for closing, as is the ConocoPhillips refinery in Trainer, Delaware County, if no buyers are found.  Making the sin mortal, there are reports that the ConocoPhillips plant might be dismantled, shipped overseas, and resurrected in a foreign—potentially adversarial — country.  But this is nothing new, as America’s abandonment of its manufacturing base has often included shipping entire facilities overseas for the benefit of our competitors.

Can it be reversed? Is it possible not only to save these refinery jobs but at the same time create a rebirth of American manufacturing — mandatory for the nation’s future since no country has ever survived without an industrial base?  Many “experts” will arrogantly claim “no,” that America can’t compete with Chinese labor costs, and smugly proclaim that manufacturing is passé anyway— unnecessary in a modern 21st century economy.

Unfortunately, the wrong people here are losing their jobs.  The backbone of America shouldn’t be facing the unemployment lines. The so-called experts, including the politicians from both Parties who got us into this mess, should be the ones getting canned. 

(See Freindly Fire’s Sunoco Refinery Part One:)

http://blogs.phillymag.com/the_philly_post/2011/12/21/save-philadelphias-sunoco-refinery-jobs/

But if we are to save jobs by retooling the refineries to process God’s gift to Pennsylvania (and the nation) — Marcellus Shale natural gas — it is imperative to stop the blame game and halt the tendency, while natural in a time of such high emotion,  to conveniently point fingers at whatever “boogeyman of the day” caused this unfortunate situation. Likewise, the fly-by-night ideas proposed by some shortsighted politicians must be seen for what they are: either clueless suggestions or a naked pandering for votes.

*****

Who Didn’t Cause The Problem

Sunoco

A million dollars is a lot of money — who hasn’t thought about having that much cash? You could do a lot with a mil per year, even more if you made that per week, and would be king of the world if you raked in seven figures per day, especially if that that was the case for three straight years. Life would be sweet — unless, of course, you happened to be in the sweet crude oil refining business in a deteriorating market.

So let’s be consistent. If making a million a day is desirable, losing that amount on a daily basis would be, in professional financial nomenclature, very, very bad. Common sense tells us that anyone losing a million a day for three years would do everything possible to stop the hemorrhaging. Welcome to Sunoco’s plight.

Ask any student unschooled in economics what the primary objective of business is, and he will invariably answer, “to make money.” Wrong.  Making money is easy.  Earning a profit by taking in more than you spend — the correct answer — is the hard part.

Despite the misguided “Occupy” mentality that profits are nothing more than gluttonous greed, the truth is quite different. They are necessary to expand operations, hire more personnel, pay salaries and benefits, and contribute to the overall health of a company —and the entire economy.  (Not that Wall Street greed doesn’t exist in numerous other forms, much of which should be regulated/outlawed, but that is another column).

Sunoco and ConocoPhillips are not in the “business” of losing money, and their past profits and payouts to shareholders are completely irrelevant to the fact that the outlook for the refining business is bleak.  They are under no moral, ethical or financial obligation to keep the doors open. Keeping people employed inefficiently—READ: subsidized — in a business with no possibility of profit is anathema to the Free Market and would eventually collapse the entire entity.  This is not speculation but economic certainty.

And if you want to see what happens when this course is recklessly pursued, pull up a chair because you’re in luck. You have a ringside seat watching such an implosion in action: the unsustainable economic policies of the United States Government.

It is also important to note that in 2009, Sunoco announced a significant worker layoff in an attempt to improve company competitiveness — and all were white collar, with no unionized personnel getting pink slips.  Closing the refineries is anything but anti-labor.

Unions

The refinery shutdowns have nothing to do with “greedy unions sucking too much money” from the companies’ bottom lines, as some critics of organized labor incorrectly state. Many of those in refinery operations are highly- skilled union workers who have made a solid living over the last several decades. But a look at the market conditions shows such a minefield ahead for the companies that no amount of concessions would come close to solving the problem.  In the big picture, the significant obstacles facing Sunoco and ConocoPhillips are infinitely greater than any “high” labor costs associated with operating the refineries.

Just like “evil empire” rich oil company executives make inviting targets for blame, so do “pillaging” unions who “want more for doing less.” Is either side perfect? Of course not, since there is no such thing. But while both make good scapegoats, it is simply counterproductive to continually throw darts at them.  Insults don’t solve problems. Strategic vision and genuine partnerships do. The only thing that matters is solving the problem — and quickly. 

Obama

Some find it convenient to blame the President for everything from high gas prices to their children getting a bad test grade. While he certainly has his faults, he extended his hand to the Republicans on the single most important issue of our time — moving America towards energy independence.  If some of his suggestions had been enacted (which, in reality, are part of the Republican platform), they would have quite possibly made the refining outlook much brighter for Sunoco and Conoco, and the shutdowns may not have occurred.

And the GOP response? No bills were introduced, and they absolutely refused to work with the President, with many stating that “he didn’t really believe what he was saying.”  What a brilliant, mature response.

For the disbelievers who need proof, just watch the President’s 2010 State of the Union speech, when, in front of the entire nation, he urged Congress to expand our offshore drilling ventures, and freed up millions of acres of coastal water for exploration and development. In addition, he called for an increase in nuclear power plants across America and pursued loan guarantees for new facilities (even one year later in light of the Japanese disaster).

Which was interesting, not only because he went against one of his strongest constituencies (the environmental lobby), but also because Obama’s move threw a wrench in the conspiracy that he was a closet Muslim who wanted to weaken America. Pushing for energy independence would be the polar opposite way to achieve that goal.

Granted, Obama has not been stellar in following up on his domestic drilling initiatives after the BP spill, and has yet to authorize the critical Keystone XL Pipeline project, but those shortcomings pale in comparison to the other Party’s inaction.

What did oilman George W. Bush or his Halliburton-affiliated sidekick Dick Cheyney do to increase domestic production? Zero.

Or the patriarch of the Bush family, George Herbert Walker Bush?  Well, it was the elder Bush who signed the moratorium on offshore drilling. His son W. left it in place for seven years, despite having sizable majorities in both Houses of Congress. Only after fuel costs skyrocketed to over $4.50 per gallon in 2008 did he call for the lifting of the moratorium. But it was too little, too late. And it never happened.

What could have prevented those crippling spikes at the pump? Offshore drilling — both off the continental shelves and in ANWR (the Arctic National Wildlife Refuge) — and the construction of new refineries, given that the last one was built in 1976.

And what better time to have pushed it through than right after the September 11 attacks. In addition to having a Republican congress and nearly 100 percent of the nation behind him, Bush had the world’s goodwill in his corner.

Instead, this nation’s reliance on foreign oil — which is a nice way of saying we are pumping billions of petro dollars into the coffers of some who are hell bent on destroying us — has only increased.

And this week, gas hit another all-time high for this time of year.

Both Parties are guilty of forsaking America’s security and economic well-being. It is only right that they atone by eliminating the red tape, bureaucracy and onerous regulations placed upon the energy industry, as well as rescind the economy-killing taxes on fuel.  Those steps would make it infinitely more palatable for entrepreneurs to convert the refineries, keeping those strategic assets and jobs exactly where they belong: in America.

 

Parts Three and Four will detail solutions for how refinery conversions can jumpstart the economy through specific uses of dry and wet natural gas — while NOT making Philadelphia a port for Liquefied Natural Gas. 

 

Chris Freind is an independent columnist, television/radio commentator, and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com  His self-syndicated model has earned him the largest cumulative media voice in Pennsylvania. He can be reached at CF@FreindlyFireZone.com

, , , , , , , , , , , , , , , , ,
January 18, 2012 at 1:09 pm Comment (1)

Chambers Of Horrors: Chambers of Commerce Have Sold Their Soul

Chambers Of Commerce Have Sold Their Soul

“The Greater Philadelphia Chamber of Commerce is dedicated to promoting regional economic growth…and advancing business-friendly public policies.”

So says the Mission Statement of Philadelphia’s Chamber of Commerce.

It further states that it is, “dedicated to supporting and encouraging the continued growth” of its members by striving “to influence business-friendly legislation in all levels of government, participate in initiatives to improve education and the community.”

And its Public Policy department is supposed “…to address pro-business legislation directly with the policy-makers who can make a difference.”

Wow.

If only the Chamber put just a small fraction of that mission into reality, maybe Philadelphia wouldn’t be such a dismal place to live and work.

But the city Chamber is not alone in selling out its members.

Last month, the Montgomery County Chamber, in an act that defies belief, issued a “Lifetime Achievement Award” to Governor Ed Rendell at a “Celebration of Excellence” event. 

It’s no small point that Rendell, more than anyone, is responsible for the carnage that is Pennsylvania’s economy.

*****

Chambers of Commerce are, and should be, non partisan.  They should work with, and support, candidates who advocate pro-business policies.  Even more important, they should be vocal —and unified —in opposing those who favor policies contrary to their mission.

Call me crazy, but Ed Rendell fits into the latter category.  Of this, there can be no dispute.

Maybe Rendell’s vision has been shaped by the belief that government knows best, and wealth should be redistributed from those who work to those who don’t.

Or maybe it’s because he’s been on the public dole for virtually his entire working life, which certainly gives one a different perspective from those in the private sector creating jobs, meeting payroll, and growing the economy.

Either way, Rendell’s policies should have been opposed at every turn by the Chambers, whose primary responsibility is to fight for a pro-business legislative agenda.

But too many didn’t.  And for a Chamber of Commerce, even one sell–out is one too many.

In the Montco Chamber’s case, maybe leader Al Paschall wanted to be liked by Rendell; maybe it was an ego boost to have the Governor know his name.

That’s fine if you’re a regular citizen, but not if you run a Chamber of Commerce.

So how could Rendell, of all people, have earned anAchievement Award?

 Difficult to answer, given the governor’s fiscal record.  Consider:

Read the rest of Freindly Fire’s column at:

http://blogs.phillymag.com/the_philly_post/2010/05/12/chambers-of-horrors/

Chris Freind is an independent columnist and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com

Readers of his column, “Freindly Fire,” hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris’ recent bestseller “Catastrophe.”

Freind also serves as a weekly guest commentator on the Philadelphia-area talk radio show, Political Talk (WCHE 1520), and makes numerous other television and radio appearances.  He can be reached at CF@FreindlyFireZone.com

, , , , , , , , , ,
May 12, 2010 at 3:42 pm Comments (0)

Rendell: Always Sticking His Nose Where It Doesn’t Belong

Rendell: Always Sticking His Nose Where It Doesn’t Belong

Gov. Should Not Try To “Partner” With The Media

BY CHRIS FREIND

Ed Rendell just doesn’t get it.

Pennsylvania’s Democratic governor has always had a long history of sticking his nose where it doesn’t belong, but an article in the Aug. 24 New Yorker magazine confirms that Rendell either doesn’t know about the line between government and the media — or just doesn’t care.

It was reported that Rendell had approached billionaire New York City Mayor Michael Bloomberg last year to buy the financially ailing Philadelphia Inquirer and Daily News. Mr. Rendell was quoted as saying, “We discussed a few things, and I tried to convince him to come down and buy The Philadelphia Inquirer and the Daily News.”

After being questioned on his statement, a Rendell spokesman said the governor was just kidding.

Sure he was.

After all, joking about the Inquirer’s demise ranks among the funniest things in the world.

If Fast Eddie didn’t have a track record of wildly overstepping his boundaries, maybe his “joke” excuse would be believable.

Consider:

Earlier this year, Rendell publicly scolded the Sunoco oil company for its decision to lay off 750 workers, calling the company’s action “unconscionable.” Yet he didn’t say a word about the 3,000 layoffs — four times the number at Sunoco — that Comcast has executed in the past year.

Could that disparity have something to do with the amount of campaign money both entities contributed to the governor?

Since the 2002 election, Sunoco’s political action committee (PAC) contributed $55,000 to Rendell.

During that same time period, Comcast’s PAC, its employees, and the spouses of its top executives, have donated $634,350, with Comcast spending an additional $100,000 on the gov’s inauguration festivities in 2007.

But beyond the money trail, the larger question is why a governor is budding into the business affairs of a private-sector company. One of the fundamental principles of this country – at least until recently – is that businesses be allowed to operate free of government interference. Public officials and bureaucrats have no right to force their way into affecting corporate policy because they happen to disagree with a company’s internal business decisions.

Worse than that, however, has been Rendell’s foray into the news media.

The Fourth Estate, as the media is known, is afforded constitutional protections that allow it to be the independent watchdog for America. Once the line is crossed between a media entity and a government official discussing a partnership, all credibility is irreparably lost, on both sides. Attempting to say that such a close relationship would not affect unbiased and objective reporting is simply ludicrous.

But that’s exactly what Rendell has been doing.

Before the current owners of the Inquirer and Daily News bought the papers in 2006, the governor had approached billionaire Ron Burkle, urging him to make a bid. Burkle, a huge player in Democratic politics, contributed $10,000 to Rendell, and another $100,000 to the state Democratic Party. Additionally, he had raised over $1 million for Hillary Clinton.

Oh, and he also contributed $20,000 to the Philadelphia Future PAC, which makes this deplorable situation come full circle.

The Philadelphia Future PAC pumped $471,000 into the Rendell coffers, and is registered at the offices of the Ballard Spahr— the law firm where Rendell worked before being elected governor.

The PAC’s treasurer is David Cohen, arguably the governor’s closest ally, and Executive Vice President at Comcast. Cohen, who has contributed $80,000 to Mr. Rendell, is a longtime Rendell confidant and fundraiser, serving as chief of staff when Mr. Rendell was mayor of Philadelphia. Prior to joining Comcast, Mr. Cohen served as chairman of Ballard Spahr. Cohen’s wife Rhonda donated $156,000 to the governor.

Ballard, which provides legal counsel to Comcast, has come under intense media and legislative scrutiny for the frequency and amount of the secretive no-bid contracts it has received under the Rendell administration. The firm has contributed $481,000 to the governor’s campaigns, with its attorneys donating an additional half million dollars. The address on Gov. Rendell’s campaign finance reports is the 51st floor of 1735 Market Street in Philadelphia — where Ballard Spahr occupies the entire floor.

Mr. Cohen also serves as chairman of the Greater Philadelphia Chamber of Commerce.  Despite Mr. Rendell’s unprecedented intrusion into the private business sector by his attack on Sunoco, a major Philadelphia employer and chamber member, no action was taken by the chamber to defend the company.

See a pattern here?

So it shouldn’t have come as a surprise when yours truly broke the story earlier this year that Rendell was engaged in talks with Brian Tierney, publisher of the Inquirer and Daily News, for a taxpayer-funded bailout for the papers. At Gov. Rendell’s request, meetings also took place that explored the two largest state pension funds bailing out the newspapers.

After a public uproar, Philadelphia Media Holdings, which owns the papers, filed for bankruptcy.

Despite criticism from the Wall Street Journal, which called taxpayer-bailouts for newspapers “the worst bailout idea so far,” George Will’s syndicated column, and the Dick Morris’ New York Times bestseller Catastrophe, Mr. Rendell still doesn’t see anything wrong with exerting his influence in the private sector.

Undoubtedly, he would have been better off focusing on the duties for which he was elected. If he had, Pennsylvania wouldn’t be facing a $3.2 billion deficit, and his approval rating wouldn’t stand at a dismal 39%.

The governor’s repeated efforts to be an integral part of the very media charged with covering his performance is repugnant. If he wants to be part of a newspaper upon leaving office, good for him. But until that time, he needs to do his job— and hopefully the rest of the media will do the same.

Chris Freind, author of “Freindly Fire,” is an independent newspaper columnist whose readers hail from six continents, thirty countries, and all fifty states. His home publication is The Philadelphia Bulletin. He can be reached at CF@FreindlyFireZone.com

, , , , , , , , , , , , , ,
August 21, 2009 at 7:26 am Comments (0)

Comcast and Rendell: A High-Octane Connection

Comcast and Rendell: A High-Octane Connection

Conflicts of Interest Pervade the Relationship

BY CHRIS FREIND

Democratic Gov. Ed Rendell’s recent decision to criticize the Sunoco oil company for laying off 750 workers raises a number of intriguing questions. While the governor saw fit to hold a press conference solely to excoriate Sunoco, calling the company’s decision “unconscionable,” he has been notably silent concerning 3,000 layoffs — four times the Sunoco amount — which Comcast has executed in the past year.

Since the governor’s election in 2002, SUN PAC, the Sunoco political action committee, has contributed $55,000 to Mr. Rendell, with Sunoco employees donating an additional $2650.

During that same span, Comcast’s PAC, its employees, and the spouses of its top executives donated $634,350 to the governor. Additionally, Comcast spent at least $100,000 on Mr. Rendell’s inauguration festivities in 2007, being designated “Benefactor” by the governor, the highest level of contributor.
The David Cohen Factor

The governor’s closest ally at Comcast is Executive Vice President David Cohen, who has contributed $80,000 to Mr. Rendell. Mr. Cohen is a longtime Rendell confidante and fundraiser, serving as Chief of Staff when Rendell was Mayor of Philadelphia. Prior to joining Comcast, Cohen was Chairman of the Ballard Spahr law firm, where Mr. Rendell worked while campaigning for governor. Ballard, which provides legal counsel to Comcast, has come under intense media and legislative scrutiny for the frequency and amount of secretive no-bid contracts it has received under the Rendell Administration. In addition, it received almost $800,000 for work on the Pennsylvania Turnpike without any contract.

Ballard Spahr LLP has contributed $481,000 to the governor’s campaigns, with its attorneys donating an additional half million dollars. Also, the Philadelphia Future political action committee (PAC), registered at the Ballard offices and whose treasurer is Mr. Cohen, pumped $471,000 into the Rendell coffers.

The address on Gov. Rendell’s campaign finance reports is the 51st floor of 1735 Market Street in Philadelphia. Ballard Spahr occupies the entire floor.

Cohen also serves as Chairman of the Greater Philadelphia Chamber of Commerce. Despite Mr. Rendell’s unprecedented intrusion into the private business sector by his attack on Sunoco, a major Philadelphia employer and Chamber member, no action was taken by the Chamber to defend the company.

The Comcast High Speed Money Connection

The Comcast money trail doesn’t end with Mr. Cohen. Ralph Roberts, Comcast’s founder, his son Brian, who serves as Chairman and CEO, and several other executives are strong Rendell backers. The elder Roberts contributed $52,500, and the son, $48,500. Comcast Chief Operating Office Stephen Burke donated $32,000.

According to Department of State records, the spouses of Comcast executives also made high-dollar contributions to Mr. Rendell. Rhonda Cohen donated $156,000, and the Roberts’ wives, Suzanne and Aileen, respectively, combined for another $25,250. Gretchen Burke contributed $5000.

The Comcast Corporation PAC contributed $93,500 to Rendell campaigns.

Rendell: On The Comcast Payroll

In addition to his $145,000 salary as governor, Mr. Rendell has also worked as a part-time football commentator for Comcast, earning a reported $20,000 per year. This arrangement has led many to question the apparent conflict, but the governor simply brushes off such criticism. As governor, Mr. Rendell has also collected a paycheck from the University of Pennsylvania, where Cohen serves as the Chairman-elect on the Board of Trustees, for his services as a lecturer. The university is a recipient of substantial state aid.

Comcast Aid: An End Run Around the Legislature

In constructing its new Center City headquarters, Comcast executives lobbied the state government for financial assistance. The firm sought a Keystone Opportunity Zone (KOZ) designation for its building, which would have provided local and state tax relief. Despite the fact that KOZ’s are intended to spur development in areas of blight, not prosperous Center City locations, the $30 billion company almost succeeded with the help of Gov. Rendell. Had the Comcast effort prevailed, the company would have been exempt from state and local business taxes until 2015.

Ultimately, the Pennsylvania legislature defeated the efforts of Comcast and the governor.

The governor then made an end-run around the legislature, funneling nearly $43 million in taxpayer money to aid Comcast and pay for infrastructure near the Comcast building, prompting outrage from many. Comcast’s direct incentives were nearly $13 million.

The economic development funds equated to roughly 10% of the building’s cost.

A Cynical Public

At a time when political corruption trials, pay to play scandals and conflicts of interest are rampant, polls show a public with an increasingly cynical view of their government and elected officials. The Pennsylvania legislature has responded by introducing a number of bills aimed at how state contracts are awarded.

Under the Rendell Administration, over $1 billion in no-bid contracts have been awarded.

Chris Freind can be reached at cf@thebulletin.us

, , , , , , , , , , , ,
March 28, 2009 at 2:15 pm Comments (0)