When it comes to gambling, there has never been a shortage of opinion amongst the masses. Either people favor it or they feel strongly that it accompanies some of society's more depraved behaviors, along with attracting crime, and is a negative temptation for our youth.

Regardless of what side of the table you are on, most folks can agree that they would like less government regulation when it comes to indulging in their leisure activities of choice. But such becomes far less clear when the government jumps in.

As hard as we might try to understand the present United States federal laws on the books when it comes to gambling, and especially with the advent of constantly evolving computer technology, legislation has not kept pace.

Additionally, lawmakers are too often wont to ignore a problem, lest it detract from their popularity, and more importantly, when it might interfere with receiving campaign cash from certain lobbying industries.

So they drag their proverbial feet until an issue reaches a fever pitch and it simply must be addressed; even if it is not in a cohesive manner or in the best interests of their constituents.

Also, with respect to gambling, I have previously documented in several previously published 2010 articles that many state governments in the U.S. have already started to craft legislation in hopes of feeding their depleted coffers by further relaxing their laws to allow more access to gambling.

Everything from expanding brick and mortar gambling casinos to advancing racinos and adding slot machines at horse race tracks to allowing intrastate and interstate online gambling are seen collectively as a potential bonanza that will cure all ills for the empty tills lining their budgets. And it is estimated by the federal government that there could be as much as a $42 billion windfall over a 10-year stretch in taxable revenue.

It is quite interesting, but not by virtue of coincidence, that most of this seeming rush to pass such legislation by U.S. states comes at the same time that the U.S. Congress is plotting ways to overturn the only recently implemented the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA), through a proposed law by Congressman Barney Frank (D-MA) that he originated in 2009.

It just won its initial approval in the U.S. House of Representatives through its Committee on Financial Services on July 27, 2010, on which Rep. Frank is the Chairman. Known as the House Resolution 2267 (H.R. 2267) Internet Gambling Regulation, Consumer Protection and Enforcement Act the House Financial Services Committee's approval is but the first phase of its passage, required by both houses of the U.S. Congress.

In short, the UIGEA was a nice way for the U.S. government to keep offshore online betting casinos at bay from the American consumer. It was initially enacted in October 2006, but was never implemented until June 1, 2010, after many long delays by the federal government's U.S. Department of the Treasury in compelling U.S. banking institutions to honor its rules.

However, the main problem, which will continue to haunt H.R. 2267 is the actual legal definition of "illegal online gambling," thus creating all kinds of loopholes and wiggle room, from the living room gambler to organized crime, to skirt the law.

And also of concern in the presently active UIGEA is that banks remain the only legally accountable parties subject to penalty and prosecution for furnishing offshore online gambling to U.S. residents, while the U.S. gambler placing the bet remains safe. And to date, banks and payment processors are still unclear as to which transactions are actually required to be blocked.

Due to the difficulty in deciphering a non-finite system for the processing of legal U.S. based online gaming transactions, consumers' credit cards and debit cards cannot only be blocked or frozen, but accounts are often cancelled.

Furthermore, a consumer, ignorant of the UIGEA could innocently go to a gambling site, not even knowing from where it emanates and later find that their credit line or checking account is in peril, simply by clicking on an illicit site.

So for now, that is the best that the U.S. government has served up, as concerns online gaming. But not shy to out-do itself, even if it compounds a dysfunctional process even more so, the federal government has plans to muck it up again through a poorly framed H.R. 2267 almost immediately setting it up to fail.

H.R. 2267 is overly broad and murky, yet will intrinsically involve the U.S. Department of the Treasury and the U.S. Internal Revenue Service (IRS), amongst other U.S. federal agencies, for starters.

It is merely a wish list without the necessary mechanisms in place to not only generate the hoped for tax revenue, but for enforcing the law itself. And it stands to open the floodgates for illicit online gaming, incongruous with what it should be designed to do.

It would leave online gambling sites left to police themselves, merely under the purview of the U.S. federal government.

And like most other large pieces of U.S. legislation that has been conveniently rushed through to final Congressional passage, H.R. 2267 is another boiler plate document of mandates to be fulfilled at a date certain after it is already signed into law.

But due to its ambiguity, which seemingly appears by design, H.R. 2267 calls for provisions and assorted amendments that cover a wide array of issues. And it is worth noting several of them here, in order to show how arduous it will be for its desired compliance.

Firstly, it authorizes the U.S. Secretary of the Treasury to create a licensing program for regulations and enforcement of the law, issuing licenses to online gambling entities, effective for a period of five years.

Thus, it prescribes the licensing requirements for such internet gambling entities and prohibits operation of an Internet gambling entity that knowingly accepts bets or wagers from persons within the U.S. without the necessary license issued from the U.S. Department of the Treasury.

The law would prohibit a person, deemed prohibited from gambling with an online gambling entity, from collecting any winnings. Such a system to screen a gambler's veracity must be created by each gambling entity, and to be overseen by the federal government. And such is pure folly at this juncture.

H.R. 2267 would require that an online gambling entity pay required taxes to the IRS. And most curiously of all, each gambling entity, itself, would need to implement safeguards against fraud, money laundering, and terrorist financing.

In addition, each online license would require that gambling sites have strong protections in place to prevent minors from gambling online, and to prevent inappropriate online advertising targeted to underage gamblers or specifically aimed at compulsive gamblers.

Not only must the gambling site maintain a list of compulsive gamblers, but must block them from site access. And it cannot allow access to its site for those individuals who are delinquent on child support payments. These are just some amongst many other illusory imperatives.

Enforcement of U.S. law for the prevention of and tracking of electronic transactions of funds sent to terrorist organizations abroad has been weak at best through the U.S. Department of the Treasury, nine years since September 11, 2001. And to essentially require online websites to take on such a task is laughable.

Other proposed mandates include that debit cards only be used for transactions, to the exclusion of credit cards. Offshore online gambling operations such as PokerStars.com, FullTiltPoker.com and UltimateBet.com, which allowed U.S. players to access their sites after the UIGEA went into effect, will be banned from acquiring a U.S. license, as well as other entities that intentionally violated this U.S. law.

Each state and Indian tribe may opt-out of the federal legislation during the first year after its enactment, requiring that their residents abide by respective local laws.

And sports betting, with the exception of U.S. based horse racing and para-mutuel betting, would be disallowed, much to the delight of the professional and college sports industries. U.S. state lotteries, should they eventually become accessible online, would also be exempt.

But perhaps falsely anticipated with this new law is the notion that gamblers will be allowed much freedom to do as they wish in the privacy of their own homes. However, given the bevy of requirements for oversight, nothing could be further from the truth. Deadbeat dads need not log on, as previously noted.

But more realistically, beginning with Internet Service Providers or ISPs, one would expect that they would have to be the gatekeeper for gathering initial information as to whether the gambler is even eligible to gamble, based upon their state of residence, if that state has opted out. And the banks would be the second line of defense, cutting off the gambler's funds if need be, should the online gambling site find that it is a documented compulsive gambler placing the bet.

And should a player gain access to a legitimate site, then the process begins as to whether they are of majority age, has been flagged as a delinquent parent, or has a criminal background. Without such due diligence, the individual gambling site is subject to losing its license.

Certainly none of these entities are law enforcement agencies, so for the federal government to expect legitimate oversight to be realized at these levels seems more than silly.

The purpose of this report was to give a glimpse into what lurks ahead for U.S. online gaming and is not intended to disparage the gambling consumer nor the gambling industry. Rather, the intent is to highlight some of the future changes in law which may not best serve the public or the industry.

And contrary to the online gaming industry's millions of lobbying dollars spent in Washington, D.C. in order to help initiate this latest planned legislation, it might be best for it to restrain its glee, at this time.

For one only needs to look at the present economic condition of Las Vegas, NV. It has now been proven, going back to the onset of the current recession in 2008, that the gambling industry is indeed no longer recession proof. Yes, in time Vegas and its hurting East Coast counterpart, Atlantic City, NJ, will both rise again.

However, with a 14.5% unemployment rate that Las Vegas presently owns, it is evidence for when entire economies are dependent upon the gambling industry for the creation of jobs and funding municipal programs, disaster can ensue. Therefore, for entire U.S. state and federal programs' very survival to be based upon discretionary income from gambling has lawmakers living in a fool's paradise.

Hopefully, in the coming weeks and months, prior to the entirety of the U.S. House of Representatives approving H.R. 2267 and before it is sent on to the U.S. Senate, that not only will cooler heads prevail, but that a better proposed outcome will exceed before everyone's chips are cashed in.

Cheers!

Copyright ©2010 Diane M. Grassi

Contact: dgrassi@cox.net

It was on June 21, 1788 that the United States Constitution was officially adopted with its ratification. And it was at that time that its ratification was contingent upon suggested changes be made to the Constitution, thereafter.

Leading up to the Constitution becoming effective, there were numerous debates among the states, namely that the Constitution did not go far enough in protecting personal rights and liberties and would provide for a necessary buffer from infringement by the government on the fundamental rights of the people.

The document simply failed to specify what fundamental rights would be protected from abuse of power, by the federal government and especially in times of emergency.

And it was in the first session of Congress in 1789 in which 12 amendments were proposed of which 10 were ultimately ratified on December 15, 1791. These amendments became known as the Bill of Rights.

The people were rightfully concerned that the Constitution must remain true to its intent; to prevent the misuse of its powers and to protect those very fundamental rights it was charged to protect.

Not the least of such rights was Amendment 1, and its often referenced freedom-of-speech clause. Its main purpose is to provide protection or a deterrent against censorship by the government and its officials. And it is implicit that the First Amendment be invulnerable when a law or government action is at issue.

And it is crucial that the press remains the watchdog of the people, in order to help decipher fact from fiction and for it to report the facts.

If we fast-forward 250 years, we still have two Houses of Congress, more unaccountable than any time in our history, an Executive Branch, creating its own shadow government within the very walls of the White House, and a judicial branch which has evolved into an activist judiciary. And most unfortunately, we have a press corps, a/k/a the media, which no longer remains accountable to the people and at every turn fails to remain objective in its reportage.

It was Thomas Jefferson who noted in 1799 that, "Our citizens may be deceived for awhile, and have been deceived; but as long as the presses can be protected, we may trust to them for light."

But sadly on June 24, 2009, in perhaps the most egregious exercise in blurring the lines between fact and fiction. ABC News, one of the three largest news broadcasting networks in the U.S. and throughout the world, will broadcast its programming from the Blue Room in the East Wing of the White House.

But even more stunning and unprecedented in White House history, it broadcast a prime time special titled, Questions for the President: Prescription for America, an ABC News production. President Obama will answer questions, pre-selected, pre-scripted and censored, by ABC News and the White House.

The intent is to "inform" the people of Obama's new healthcare plan, which has not been seen nor discussed by the Congress, in an open forum, and remains a mystery as to its details, not publicly disclosed. No opposition questions or representation of any ideas other than those of Obama's, ABC's or the Democratic Party will be permitted.

So essentially, conservatives and Republican lawmakers felt justified referring to it as a paid infomercial, not a "news" program. Usurping the Congress and the will of the people is anathema to abuse of power.

The nationalization of U.S. healthcare, as important and personal a matter as it is to every American has now been hijacked, along with the public's airwaves. If Obama's intentions for the American people cannot withstand honest and unscripted dialog and discourse but rather necessitates an imposter shilling as a news network, then it will fail the American people.

But do remember if you decide to tune in on Wednesday, that, "The most effectual engines for pacifying a nation are the public papers…A despotic government always keeps a kind of standing army of news writers who, without any regard to truth or to what should be like truth, invent and put into the papers whatever might serve the ministers. This suffices with the mass of the people who have no means of distinguishing the false from the true paragraphs of a newspaper." – Thomas Jefferson (1816)

Copyright ©2009 Diane M. Grassi
Contact: dgrassi@cox.net

In this third chapter of this ongoing discussion and analysis of United States energy policy and its ramifications both realized directly and indirectly from the U.S. Energy Policy Act of 2005, (EPAct 2005) it would be irresponsible not to include U.S. nuclear energy policy in such analysis.

As such, the EPAct 2005 and its previously referenced and unprecedented mandates, in prior chapters of this report, play a role with the reformulation of the regulation of U.S. nuclear energy and its projected and rather overwhelming imminent comeback.

The nuclear energy industry has become a global proposition given the changing geographic demands of energy needs in newly industrialized nations such as India and China. And it would be foolish for the U.S. to assume that it operates in a vacuum and that its future energy needs and demands will not be impacted by such changes in a global economy; one in which the U.S. is now primarily at the receiving end of offshore manufactured goods, including more and more of America's food supply.

But the global economy has but given the U.S. government and in particular in this case, the U.S. Department of Energy, (DOE) an excuse to take the proverbial lid off of sound national security policy which has necessarily dictated U.S. energy policy for decades, until now, for the safety of the American people and the integrity of its critical infrastructure.

Although the first large scale civilian nuclear plant started providing electricity in 1957, it was basically between that time and the late 1970's when all of the current operating nuclear reactor facilities were constructed. And with an average lifespan up to 60 years for each, most of the currently operating 104 U.S. nuclear plants are either in or have applied for their 2nd 20-year licensing period extensions.

Since the last U.S. nuclear reactor was ordered in 1973, those handful that were completed, after 1978 and post-3 Mile Island, were ordered prior to 1973. To wit, in 1996, the last U.S. plant constructed, the Tennessee Valley Authority's Watts Bar 1 reactor in Tennessee, was the result of a revived dormant license from 1970. And there are plans to build the Watts Bar 2 from another previous license from dating back to1973.

Since U.S. nuclear energy policy has nearly come full circle today, it is important to take stock of its history. The Atomic Energy Commission, (AEC) was formed through the Atomic Energy Act of 1946, originally to specifically oversee the military's and civic atomic energy programs. And it was given the expanded responsibility, for the first time, to assume dual oversight and regulation of atomic energy both militarily as well as commercially through the Atomic Energy Act of 1954.

But it was through the Energy Reorganization Act of 1974, that created the Nuclear Regulatory Commission (NRC), the present U.S. nuclear regulatory agency, to assume the oversight authority from the AEC. It now regulates most U.S. commercial nuclear activities, including nuclear power reactors and the use of radioactive materials in industry, medicine, agriculture and scientific research as well as fuel cycle facilities and nuclear waste management.

The 1974 law was seen as an opportunity to put trust back into the oversight agency which took on the dual task of both promoting nuclear power while safeguarding the American people, initially in 1954. And it was after that point in time that the American people had already begun to lose trust in the agency's ability to do so. Apparently, the U.S. government thought that changing the acronym of the agency would calm the public's displeasures.

But it was during the late 1960's and early 1970's when the nuclear plant construction boom was in full gear and simultaneous reassurances from the federal government to keep safeguards in place fell on the deaf ears of energy consumers. Most importantly, the agency was designated to walk a fine line of both promoting commercially viable nuclear energy as well as handling all of the required licensing for new construction of nuclear power plants.

And in this global economy, at a time when the U.S. is seeing extraordinary growth in the foreign direct investment and acquisition in U.S. critical infrastructure, it appears reaped with conflict for the licensing agency to also be able to independently assess potential security risks both civilly and criminally.

Unfortunately, the notorious Browns Ferry Nuclear Plant fire in 1975 in Decatur, AL could have been avoided and was the result of human error rather than an unexpected meltdown. A mechanical technician foolishly was looking for reported air leaks within the reactor with a lighted candle which ultimately started the fire. But
Three Mile Island Unit 2 (TMI-2) nuclear power plant near Middletown, Pennsylvania, on March 28, 1979, was the most serious nuclear plant fiasco in U.S. history. The reactor sustained the melting of half its core, which was later found to be a combination of technical and human error and allowed for released radioactive gases into the atmosphere and putting its employees immediately at risk.

The 3 Mile failure was followed in 1986 by the misfortune of Unit 4 of the nuclear power station at Chernobyl, Ukraine in the former USSR. It emitted radioactive material, far more deadly an accident that 3 Mile Island, affecting 52,000 people in the vicinity, immediately killing 30 people and possibly impacting up to 5 million others. Nevertheless, it was 3 Mile Island that provided the final nail in the coffin for skittish investors in U.S. nuclear technology, although nuclear facilities throughout the U.S. still provide 20% of electrical power generation. It remains very low in greenhouse emissions and is considered a form of clean energy.

In spite of the NRC's own damage control to restore safety measures in nuclear plant facilities over the past 30 years, its ill-repute remains along with remnants of trepidation in reinvesting in nuclear energy. Therefore, the apparent overnight reverse course by the DOE in lining up investors to submit license construction applications for nuclear energy plants, with some 20 expected by mid-2009, has set off alarm bells of another sort.

And that brings us back to the EPAct of 2005 which provides for a vast assortment of givebacks, subsidies and federally subsidized loan guarantees including risk insurance packages to the brokers and investors who come a-callin', totaling billions of dollars worth of incentives. And once again, foreign owned holding companies, foreign government-owned entities and foreign-U.S. joint ventures, acquisitions and mergers will be the recipients of these U.S. taxpayer provided benefits.

The nuclear energy industry not only remains a hot-button issue because of its sullied past, but because of a heightened internal as well as public awareness of its ever-present national security risks it now poses in a post-9/11 world. In addition, there is the issue of the failing power grid infrastructure, which has not been improved in decades, and minimally maintained, along with a continued U.S. deregulation policy from which the American economy may never recover.

All of the aforementioned but creates for a perfect storm, all the while U.S. foreign policy dictates to other nations and regions on the ways in which they may engage or use nuclear material, whether for weaponry or for electrical power distribution.

The first step in trying to comprehend this multi-faceted and current energy policy, based upon both its history as well as current law, is to understand the revised NRC application process. Although the regulation revisions date back to 1989, the most recent and final rules were not certified and published in the Federal Register by the NRC until August 2007 (10 CFR Part 52).

The revisions have changed the entire regulatory review process and framework for the construction of new nuclear reactors and facilities. And over the next 18 months, such changes in the regulation process, with ink barely dry, will be tested in a paint-by-numbers fashion.

The EPAct 2005 while not intrinsic to the actual changes in NRC rule making, has played a consequential role in incentives for investors and ultimately the NRC's seeming rush to finalize regulation revisions over a matter of months, after many years they were held in virtual abeyance.

And now the one time 2-step licensing process created for its thoroughness and for compliance with the Environmental Protection Agency (EPA) as well as providing enough time to have the appropriate number of public hearings, has been whittled down to a 1-step process; one that appears less investigative in scope and more equivalent to drive-through governance.

In order to supposedly bring an improved regulatory model for U.S. nuclear energy construction, which the NRC believes to be more efficient, the COL, or combined license application, early site permits (ESP), and standard design certifications pushes the process along more quickly. However, also cut in the process will be preoperational hearings on plant construction qualification that would be limited and not required by the NRC, and minimizing public input.

The ESP procedure includes site safety issues and emergency plans apart from the plant design. The NRC's and nuclear industry's reasoning is that the new process will cut down on delays, cost overruns and reduce the application process down to 42 months. In that regard, there is some speculation that the next nuclear plant could break ground in the U.S. by the end of 2010 and perhaps be completed by 2015.

In the final part of this series, the actual players or investors in new U.S. nuclear plants construction will be addressed as well as who and from where from these entities hale. And the mechanisms mandated in the EPAct 2005 for lucrative financial rewards to these corporations will be discussed. Whether or not such investors will be even remotely close to ensuring the fiscal as well as environmental health of the American people is an important question which will be asked.

And finally, that which is most crucial in this entire changing energy landscape, that being the national security of the U.S, was etched into law in the Atomic Energy Act of 1954 in 42 U.S.C. Sec. 2011 (1954) as follows: "Aliens and entities owned, controlled or dominated by aliens or foreign governments may not engage in operations involving the utilization of energy. This restriction applies primarily to nuclear reactors and reprocessing plants extracting plutonium."

Yet, as will be analyzed in Part 4 of this series, we will see that through the use of joint ventures, foreign holding companies, license transfers and majority subsidiary investment mergers, rubber-stamped by virtually all branches of the U.S. government, historically held energy law no longer remains the watchdog it was once meant to be. Therefore, the best interests of the American people are now marginalized and the future national security interests of the U.S. may be forever compromised.

Copyright ©2008 Diane M. Grassi
Contact dgrassi@cox.net

In this third chapter of this ongoing discussion and analysis of United States energy policy and its ramifications both realized directly and indirectly from the U.S. Energy Policy Act of 2005, (EPAct 2005) it would be irresponsible not to include U.S. nuclear energy policy in such analysis.

As such, the EPAct 2005 and its previously referenced and unprecedented mandates, in prior chapters of this report, play a role with the reformulation of the regulation of U.S. nuclear energy and its projected and rather overwhelming imminent comeback.

The nuclear energy industry has become a global proposition given the changing geographic demands of energy needs in newly industrialized nations such as India and China. And it would be foolish for the U.S. to assume that it operates in a vacuum and that its future energy needs and demands will not be impacted by such changes in a global economy; one in which the U.S. is now primarily at the receiving end of offshore manufactured goods, including more and more of America's food supply.

But the global economy has but given the U.S. government and in particular in this case, the U.S. Department of Energy, (DOE) an excuse to take the proverbial lid off of sound national security policy which has necessarily dictated U.S. energy policy for decades, until now, for the safety of the American people and the integrity of its critical infrastructure.

Although the first large scale civilian nuclear plant started providing electricity in 1957, it was basically between that time and the late 1970's when all of the current operating nuclear reactor facilities were constructed. And with an average lifespan up to 60 years for each, most of the currently operating 104 U.S. nuclear plants are either in or have applied for their 2nd 20-year licensing period extensions.

Since the last U.S. nuclear reactor was ordered in 1973, those handful that were completed, after 1978 and post-3 Mile Island, were ordered prior to 1973. To wit, in 1996, the last U.S. plant constructed, the Tennessee Valley Authority's Watts Bar 1 reactor in Tennessee, was the result of a revived dormant license from 1970. And there are plans to build the Watts Bar 2 from another previous license from dating back to1973.

Since U.S. nuclear energy policy has nearly come full circle today, it is important to take stock of its history. The Atomic Energy Commission, (AEC) was formed through the Atomic Energy Act of 1946, originally to specifically oversee the military's and civic atomic energy programs. And it was given the expanded responsibility, for the first time, to assume dual oversight and regulation of atomic energy both militarily as well as commercially through the Atomic Energy Act of 1954.

But it was through the Energy Reorganization Act of 1974, that created the Nuclear Regulatory Commission (NRC), the present U.S. nuclear regulatory agency, to assume the oversight authority from the AEC. It now regulates most U.S. commercial nuclear activities, including nuclear power reactors and the use of radioactive materials in industry, medicine, agriculture and scientific research as well as fuel cycle facilities and nuclear waste management.

The 1974 law was seen as an opportunity to put trust back into the oversight agency which took on the dual task of both promoting nuclear power while safeguarding the American people, initially in 1954. And it was after that point in time that the American people had already begun to lose trust in the agency's ability to do so. Apparently, the U.S. government thought that changing the acronym of the agency would calm the public's displeasures.

But it was during the late 1960's and early 1970's when the nuclear plant construction boom was in full gear and simultaneous reassurances from the federal government to keep safeguards in place fell on the deaf ears of energy consumers. Most importantly, the agency was designated to walk a fine line of both promoting commercially viable nuclear energy as well as handling all of the required licensing for new construction of nuclear power plants.

And in this global economy, at a time when the U.S. is seeing extraordinary growth in the foreign direct investment and acquisition in U.S. critical infrastructure, it appears reaped with conflict for the licensing agency to also be able to independently assess potential security risks both civilly and criminally.

Unfortunately, the notorious Browns Ferry Nuclear Plant fire in 1975 in Decatur, AL could have been avoided and was the result of human error rather than an unexpected meltdown. A mechanical technician foolishly was looking for reported air leaks within the reactor with a lighted candle which ultimately started the fire. But
Three Mile Island Unit 2 (TMI-2) nuclear power plant near Middletown, Pennsylvania, on March 28, 1979, was the most serious nuclear plant fiasco in U.S. history. The reactor sustained the melting of half its core, which was later found to be a combination of technical and human error and allowed for released radioactive gases into the atmosphere and putting its employees immediately at risk.

The 3 Mile failure was followed in 1986 by the misfortune of Unit 4 of the nuclear power station at Chernobyl, Ukraine in the former USSR. It emitted radioactive material, far more deadly an accident that 3 Mile Island, affecting 52,000 people in the vicinity, immediately killing 30 people and possibly impacting up to 5 million others. Nevertheless, it was 3 Mile Island that provided the final nail in the coffin for skittish investors in U.S. nuclear technology, although nuclear facilities throughout the U.S. still provide 20% of electrical power generation. It remains very low in greenhouse emissions and is considered a form of clean energy.

In spite of the NRC's own damage control to restore safety measures in nuclear plant facilities over the past 30 years, its ill-repute remains along with remnants of trepidation in reinvesting in nuclear energy. Therefore, the apparent overnight reverse course by the DOE in lining up investors to submit license construction applications for nuclear energy plants, with some 20 expected by mid-2009, has set off alarm bells of another sort.

And that brings us back to the EPAct of 2005 which provides for a vast assortment of givebacks, subsidies and federally subsidized loan guarantees including risk insurance packages to the brokers and investors who come a-callin', totaling billions of dollars worth of incentives. And once again, foreign owned holding companies, foreign government-owned entities and foreign-U.S. joint ventures, acquisitions and mergers will be the recipients of these U.S. taxpayer provided benefits.

The nuclear energy industry not only remains a hot-button issue because of its sullied past, but because of a heightened internal as well as public awareness of its ever-present national security risks it now poses in a post-9/11 world. In addition, there is the issue of the failing power grid infrastructure, which has not been improved in decades, and minimally maintained, along with a continued U.S. deregulation policy from which the American economy may never recover.

All of the aforementioned but creates for a perfect storm, all the while U.S. foreign policy dictates to other nations and regions on the ways in which they may engage or use nuclear material, whether for weaponry or for electrical power distribution.

The first step in trying to comprehend this multi-faceted and current energy policy, based upon both its history as well as current law, is to understand the revised NRC application process. Although the regulation revisions date back to 1989, the most recent and final rules were not certified and published in the Federal Register by the NRC until August 2007 (10 CFR Part 52).

The revisions have changed the entire regulatory review process and framework for the construction of new nuclear reactors and facilities. And over the next 18 months, such changes in the regulation process, with ink barely dry, will be tested in a paint-by-numbers fashion.

The EPAct 2005 while not intrinsic to the actual changes in NRC rule making, has played a consequential role in incentives for investors and ultimately the NRC's seeming rush to finalize regulation revisions over a matter of months, after many years they were held in virtual abeyance.

And now the one time 2-step licensing process created for its thoroughness and for compliance with the Environmental Protection Agency (EPA) as well as providing enough time to have the appropriate number of public hearings, has been whittled down to a 1-step process; one that appears less investigative in scope and more equivalent to drive-through governance.

In order to supposedly bring an improved regulatory model for U.S. nuclear energy construction, which the NRC believes to be more efficient, the COL, or combined license application, early site permits (ESP), and standard design certifications pushes the process along more quickly. However, also cut in the process will be preoperational hearings on plant construction qualification that would be limited and not required by the NRC, and minimizing public input.

The ESP procedure includes site safety issues and emergency plans apart from the plant design. The NRC's and nuclear industry's reasoning is that the new process will cut down on delays, cost overruns and reduce the application process down to 42 months. In that regard, there is some speculation that the next nuclear plant could break ground in the U.S. by the end of 2010 and perhaps be completed by 2015.

In the final part of this series, the actual players or investors in new U.S. nuclear plants construction will be addressed as well as who and from where from these entities hale. And the mechanisms mandated in the EPAct 2005 for lucrative financial rewards to these corporations will be discussed. Whether or not such investors will be even remotely close to ensuring the fiscal as well as environmental health of the American people is an important question which will be asked.

And finally, that which is most crucial in this entire changing energy landscape, that being the national security of the U.S, was etched into law in the Atomic Energy Act of 1954 in 42 U.S.C. Sec. 2011 (1954) as follows: "Aliens and entities owned, controlled or dominated by aliens or foreign governments may not engage in operations involving the utilization of energy. This restriction applies primarily to nuclear reactors and reprocessing plants extracting plutonium."

Yet, as will be analyzed in Part 4 of this series, we will see that through the use of joint ventures, foreign holding companies, license transfers and majority subsidiary investment mergers, rubber-stamped by virtually all branches of the U.S. government, historically held energy law no longer remains the watchdog it was once meant to be. Therefore, the best interests of the American people are now marginalized and the future national security interests of the U.S. may be forever compromised.

Copyright ©2008 Diane M. Grassi
Contact dgrassi@cox.net

As previously chronicled in this series of reports subtitled, MLB Goes to Harlem Seeking Welfare, on the public financing of the new Yankee Stadium in Bronx, NY, a borough of New York City, the issues it encompasses and the various impending outcomes may have a broad impact for cities across the United States.

Moreover, public-private partnerships have become intentionally blurred when it comes to taxpayers ultimately funding of Major League Baseball (MLB), the National Football League (NFL), the National Basketball Association (NBA) and other professional sports' stadiums and venues.

Balance sheets, land assessments, funding arrangements via questionable ethical relationships if not borderline illegal ones between public officials and corporate entities are now being revealed as more than troublesome with respect to the new Yankee Stadium. And it may eventually take an act of the U.S. Congress to unravel that which appears to be an egregious violation of the public trust on behalf of NYC and the New York Yankees.

As last reported here in July 2008 in NYC, Yankees Redefine Crookery in Part 2, the NY Yankees a/k/a/ Yankees Global Enterprises LLC, had requested that an additional $366 million in tax-free bonds be appropriated, to the already ballooning $1.3 billion cost of the new Yankee Stadium tallied thus far, and financed primarily through such funding instruments.

But in order for any new approval for any such new appropriations, the process must be cleared again by a host of multiple New York City, New York state and federal agencies. However, unanticipated by the NY Yankees is that not only could such a request be denied but that they have opened up a proverbial Pandora's box of quagmires now being given scrutiny with a fine tooth comb by both the State of NY and a powerful Congressional committee.

On July 4, 2008, during the NY Yankees game at Yankee Stadium versus the Boston Red Sox and broadcast on the YES cable network , the NY Yankees own broadcast outlet, play-by-play announcer, Michael Kay, was speaking about how the current stadium would be replaced starting with the 2009 season. And he stated at the top of the 2nd inning that "And across the street they're building a new ball park which the Steinbrenner family is paying for."

Perhaps Kay should go to Capitol Hill and testify under oath and relay such news to those investigating the suspicious circumstances under which the NY Yankees obtained all of their dough. He may get a chance in September 2008 when additional hearings will be held by the House Committee of Oversight and Government Reform's Sub-Committee on Domestic Policy. After all, Kay would be in good company along with notable others associated with MLB who have been less than forthright before Congress.

But sadly, most New Yorkers either already believe that which Kay and others have reiterated or have no idea about anything going on in Yankee Land. Yet, such may set important precedents for future building projects and land takings both in NYC and other municipalities.

But far more importantly, and at a time when NYC and NY state are both eliminating important public services due to budget shortfalls, it is incumbent for taxpayers to know far more comprehensively, than that which the local tabloids have recently and but occasionally provide, about this complex web of wheeling and dealing.

For the new Yankee Stadium is no longer a house that Ruth built but one that New Yorkers citywide and statewide will be paying for and for generations to come. And in that regard a brief context of the back-story is in order and to understand in the interest of public policy.

Prior to the NY Yankees' initial approvals required from public agencies, the last of which were not completed until 2006, the Yankees put into motion key lobbyist law firms and former public officials who had prior governing positions from City Hall to the Internal Revenue Service to the U.S. Department of Treasury. And it was through such seemingly conflicts of interests that have driven the realized stadium.

Initially, the NY Yankees had to clear a hurdle by the IRS, which many now consider questionable, for the $941 million gain in triple tax-exempt bonds with a favorable low interest rate. Such will save the Yankees close to $150 million in saved interest alone.

Bond buyers get a considerably less lower set interest rate of return, when exempt from federal, state and city income taxes and therefore the NY Yankees benefit from an interest rate approximately 25% lower than taxable bonds.

Bruce Serchuk, a partner at the law firm, Nixon Peabody LLP, was retained by both the NYC Industrial Development Agency, and the NY Yankees to lobby the IRS. Serchuk was a former lawyer in the Office of the Chief Counsel at the Internal Revenue Service (IRS) and in the Office of Taxation Policy at the Department of the Treasury. He was instrumental in providing NYC lawyers help with submitting the request that allowed such payments-in-lieu-of-taxes (PILOTs).

In June 2006 the IRS granted that request to NYC in a private letter ruling. In spite of regulations that changed that very year which further restricted publicly financed stadiums using tax-exempt bonds, it got the attention of the Committee on Oversight and Government Reform's Sub-committee on Domestic Policy and precipitated a March 2007 hearing.

Yet, instead of putting a cap on spending by the NY Yankees and NYC's Industrial Development Agency (IDA), an arm of the NYC Economic Development Corporation, which operates at the Mayor's behest, NYC was granted another $190 million in tax-exempt financing for the new stadium's 3 parking garages.

But in order to get this increased financing, the garages were termed by NYC officials as "Civic Facility Projects." Additionally, the IDA created a specious not-for-profit organization, referred to as the Bronx Community Initiative Development Corporation as a "special purpose LLC" that was needed as a bridge to complete the garage financing.

Tishman Speyer Properties, now a global multi-national conglomerate, was hired by the NY Yankees for the construct of the new stadium. Anthony Mannarino, who now is in charge of Tishman's stadium development, was previously the Executive Vice President of the NYC Economic Development Corporation from 1990-1994 and its acting President in 1994.

None other than former Mayor Rudolph Giuliani and one of his former NYC Police Commissioners, Howard Safir, are both listed in court documents as security consultants for the new stadium project as Giuliani Security & Safety Partners, a division of Giuliani Partners, LLC and Safir-Rosetti Security, respectively.

There are far too many lobbying interests and reciprocal relationships to detail in this one report, but suffice it to say that the NY Yankees and NYC officials have easily spent upwards of $500,000.00 of taxpayer dollars in lobbying costs for their back-scratching stadium behemoth.

Most of the lobbying expenses were accorded in a final deal which Mayor Giuliani had ratified prior to his departure from City Hall in 2001. It allocated $25 million over a 5 year period from 2002-2007 to be used by the NY Yankees in any way they saw fit for the planning stages of the new stadium on the taxpayer's dime. And unfortunately far more than new stadium expenses were charged to the taxpayers, which had nothing whatsoever to do with stadium planning. But the NY Yankee organization could not help itself and applied for every last dime of that $25 million.

The puppet master of the whole deal is former NYC Deputy Mayor of Economic Development, Planning and Administration, Randy Levine, from 1997-2000, and now President of the NY Yankees. Prior to Levine's leaving his office in 2000, he was given the primary responsibility to craft a financing structure document for Mayor Giuliani and the new Yankee Stadium.

And prior to becoming Deputy Mayor, Randy Levine was a chief labor negotiator for MLB Commissioner Bud Selig. To make matters worse, Levine was granted a waiver from the NYC Conflict of Interest Board which oversees NYC's Conflict of Interest Law. And as a direct result of that waiver, throughout Randy Levine's term as NYC Deputy Mayor, he maintained a consulting contract with MLB.

In September 2008 the House Committee on Oversight and Government Reform's Sub-Committee on Domestic Policy whose Chairman is Congressman Dennis Kucinich (D-OH) will concentrate on those federal agencies formerly involved in the previous financing approvals and the newly requested $366 million in additional funding requested by NYC and the NY Yankees in June 2008.

Those agencies include the U.S. Department of the Treasury, the IRS, and the National Park Service of the U.S. Department of the Interior along with the NY Yankees, the NYC Department of Finance, and the NYC Economic Development Corporation. Those involved agencies have all been required to submit specific documentation to Congressman Kucinich's committee by August 6, 2008 in preparation for the atest hearing which took place on September 18, 2008 on Capitol Hill.

The issue that will continue to be explored will be the conflicting land value assessments which were supplied and used as a basis for the original $941 million tax-free bonds. It has come to the attention not only of Rep. Kucinich but New York State Assemblyman, Richard Brodsky, that the unjustified land assessment valuations may be the smoking gun in the now $1.3 billion house of cards which may bloat to upwards of $2 billion before all is said and done.

The NY Yankees claim that the land upon which the new stadium sits is worth $275.00 per square foot, more than most lots on waterfront property on Manhattan Island, the heart of NYC. The NYC Department of Finance claims that the land is worth $204 million versus NYC's commissioned independent assessors who value it at $21 million. And land just across the street from the new Yankee Stadium, according to the NYC Department of Finance's latest assessments and the latest average market value of such land in that area of the Bronx, is but $36 per square foot.

According to NY State Assemblyman, Richard Brodsky, who heads the NY State Committee on Corporations, Authorities and Commissions and who is also holding hearings on this issue on the state level has said that, "This issue goes to the heart of whether it is a public project or a private project…There is substantial discrepancy on a whole host of levels that we are going to proceed to investigate thoroughly and fairly, but we are going to get to the truth."

And as the ongoing story of this slippery slope of either trickery or merely free market big business, depending on one's point of view, this journalist will pick up the case in September 2008 and report back in Part 4 of this series.

And just in case you were wondering, "Everything is politics."—Thomas Mann (1950)

Copyright ©2008 Diane M. Grassi
Contact: Dgrassi@cox.net

"Energy independence from foreign sources." A mantra repeated over and over again by those responsible for establishing United States energy policy. But it remains a contradiction in terms as the topic is never broached candidly by lawmakers as to how much of the U.S. energy infrastructure and lines of transmission have been consumed by a constant stream of foreign direct investors and diversified holding companies.

Also unbeknownst to most consumers is that legislation which led to such deregulation of U.S. public utilities is hailed from Wall Street to Capitol Hill as the answer to resolving U.S. energy woes.
Now, foreign investors have been granted even greater leeway as now realized by such mandates of the Energy Policy Act of 2005 (EPAct 2005) which essentially eliminated the Public Utilities Holding Company Act (PUHCA) of 1935. Yet, EPAct 2005 has continually escaped public scrutiny and a lack of accountability in both houses of the U.S. Congress.

U.S. energy policy and the generation of power is a complex web of public policy, law, economics, infrastructure and ever-present globalization. So for purposes of this report, and in order to best comprehend current U.S. energy policy, it is helpful to take stock of the more recent evolution of such and to examine its many and varied elements which have changed post-2005.

EPAct 2005 amended Section 203 of the Federal Power Act (FPA) which mandated how future transactions in the energy industry will be handled by the U.S. federal government and will impact matters of states' sovereignty and ultimately regulating costs to consumers.

For over 70 years, federal laws have played a vital and critical role in the operation, production, distribution and protection of the U.S. electrical power grid. Federal laws in concert with state laws and regulations have necessarily dictated that the power grid be shielded from market manipulation and criminal behavior.
Yet, the 100 year old power grid is faced with increased power demands simultaneously with deregulation by mandate. And deregulation has led to less and less necessary preventative maintenance, upgrades in technology as well as necessary investment in research and development.

The basic structure of the North American transmission system is made up of over 140 control centers and approximately 3500 utility providers covering over 200,000 miles. Utility generating plants, transmission and sub-transmission systems, distribution systems and customer loads traveling over a two-part power grid; one in the east and one in the west. Texas has its own grid.

Compounding the vast network and intricacy of the grid is the interconnectivity and delivery of power that in many cases is incompatible with widely varying levels of equipment integrity, data systems and personnel training. It is the secondary system which supplies the distribution of electricity to consumers, where most of the power failures occur, and that which require time to repair. And the network of sub-stations feeding electricity to neighborhoods, via feeders which flow to transformers, is where most problems arise during local outages, further exacerbated by ill-maintained equipment.

U.S. deregulation of the utility industry began over two decades ago, and it was the 1992 Energy Policy Act which changed the way electricity was sold to local consumers for the first time. Energy companies were permitted to install their own plants and sought customers throughout the country, but not necessarily in the same geographic region. Energy brokers then entered into the picture and utilized the open market to buy and sell power. And thus came the onset of potential unreliability of energy delivery.

Purchasing power from plants hundreds of miles away from a respective region put unprecedented burdens upon the transmission system, raising the likelihood of power failures at the local level. Most importantly, the U.S. electrical grid was not originally designed to absorb the transmission of high voltage capacity across the continent, especially in absence of comparable and upgraded systems in place.

Although Enron became the poster-child for electrical power market manipulation, which came to light after the rolling blackouts of California in 2000 and 2001, U.S. public policy and lawmakers must be held responsible for even further erosion of federal regulations and mandates now realized in EPAct 2005.
Instead of increasing the odds that such market threats would not reappear, the U.S. government has but relaxed the law, its regulations and oversight even more, with the repeal of PUHCA 1935.

PUHCA 1935 became law after the height of the Great Depression and after the stock market crash of 1929 and was a cornerstone of President Franklin D. Roosevelt's New Deal industry legislation. It called for the prohibition of market manipulation, specifically to curtail then super-sized utility conglomerates, and to prevent monopolies from overtaking geographic regions. And just as importantly, PUHCA 1935 made it unfeasible for non-energy corporations to purchase a public utility.

The emergence and formation of the Securities Exchange Commission (SEC) in 1934, together with PUHCA 1935 became essential in safe-guarding the public trust and in protecting consumers and investors alike, as PUHCA 1935 delegated multi-state utility ownership regulation to the SEC.

With the official repeal of PUHCA 1935, in EPAct 2005, the SEC vacated its regulatory authority over multi-state utility ownership by holding companies and only retains the ability to protect investors, not utility consumers and will carry little weight over multinational holding companies. It is the Federal Energy Regulatory Commission (FERC) that will now hold individual utilities accountable through self-policing and self-reporting policies of any irregularities such as cross-subsidization.

EPAct 2005 now allows multi-state transactions and mergers of distribution facilities, utilities merging with non-utility corporations, and including foreign ownership over domestic utilities. Oil companies may now own electricity and natural gas utilities, paving the way, yet again, for the formation of cartels. Construction and infrastructure companies, from abroad, are eager to partake in being afforded acquisition of U.S. public utility operations as well.
No individual state or federal agency will have the jurisdictional efficacy to regulate the finances of U.S. public utility assets. Required oversight of parent holding companies such as investment banks, which speculate and invest in far riskier businesses with utility rate-payer revenues, is not established nor mandated in EPAct 2005.

The cost? The reliability standards of U.S. public utilities, which could have grave ramifications on U.S. national security, the U.S. economy and the well-being and safety of the American people; all with the blessings of the U.S. Department of Energy (DOE), the U.S. Congress and the global stock market.

EPAct 2005 does set forth specific mandates, unprecedented with respect to U.S. energy law, states' constitutional rights and sovereignty, as well as interstate commerce. Specifically, Section 1221 of EPAct 2005 updates Section 216 of the Federal Power Act (FPA) for a National Transmission Congestion Study which paved the way for the mandated National Interest Electric Transmission Corridors (NIETC). The Secretary of Energy may designate "any geographic area experiencing electric energy transmission capacity constraints or congestion that adversely affects consumers as a national interest electric transmission corridor."

The DOE then created as a direct result of the study two transmission corridors which consist of the Mid-Atlantic Area National Corridor and the Southwest Area National Corridor and finalized in October 2007.
Many state governors, state representatives, many federally elected members of the U.S. Congress, consumer advocacy organizations, and environmental and historic preservation organizations, oppose such corridors.

The enormity of the construct of the Mid-Atlantic Area National Corridor will impact states legislatively, constitutionally, economically, environmentally and historically. The Mid-Atlantic Area National Corridor states include the entireties of New Jersey, Delaware, and Washington, D.C., most of Maryland, most of New York; most of Pennsylvania, most of West Virginia, and major areas of Ohio, and major areas of Virginia.

In contrast, the Southwest Area National Corridor includes parts of California and parts of Arizona, albeit the most heavily populated areas of these states.

The NIETC lays the groundwork for supplemental transmission siting approval in the construction of High-Voltage Direct-Current (HVDC) Transmission lines, above ground, throughout all the NIETC designated states, whether or not that particular state in fact has an electricity congestion problem itself. Additionally, the entirety of the U.S. power grid, as it presently exists, uses High-Voltage Alternating-Current (HVAC) Transmission lines.

Only 2% of the 200,000 electrical transmission line miles throughout the U.S. are HVDC. According to the Government Accountability Office Report of February 1, 2008, (GAO-08-347R) with respect to HVDC, there will be "higher costs for short-distance lines due to the cost of equipment needed to convert DC into AC electricity used by residents and a lack of electricity benefits to consumers living along these lines –unless converter stations are installed at intermediate locations – because such lines are generally not connected to local electricity lines."

The rationale for designation corridors is not to facilitate or dictate how the states' regions, transmission providers or electric utilities should meet their own energy challenges, according to the DOE. But the truth is quite the opposite.

"The process is geared more toward expediting the approval and siting of transmission corridors than it is geared toward respecting states' rights about their residents' energy future and needs…and by a heavy-handed centralized one-size fits all approach..," according to Congressman Maurice Hinchey (D-NY). And it is precisely such sentiments that have been raised to the Secretary of Energy, Samuel Bodman, by both federal and state lawmakers on both sides of the aisle in all 10 states and Washington, D.C. that will be directly impacted by the NIETC.

This EPAct 2005 legislation enables eminent domain law over states by the federal government on a scale unlike the U.S. has ever seen and is historically unprecedented, and with respect to the federalization of U.S. power transmission.

As such, the law provides for the DOE to assign the FERC siting authority. In other words, the U.S. federal government shall dictate to individual states the transmission of their own energy and by extension, the loss of state price controls. For state Public Utility Commissions always represented consumers and oversaw pricing and maintenance standards.

The FERC is given authority "to issue permits for the construction or modification of transmission facilities in a National Interest Electric Transmission Corridor if FERC finds that: (1)(A) a state in which the facilities are to be constructed is without authority to approve the siting of the facilities or to consider the interstate benefits expected to be achieved by the project; (B) the applicant for a permit is a transmitting utility that does qualify for a permit federally but does not qualify for a permit under state law because it does not serve end-use customers; or (C) the state has siting authority but (i) it has withheld approval for the later of one year after the filing of an application; or (ii) conditioned approval in such a way that the proposed construction will not significantly reduce transmission congestion or is not economically feasible."

And, "If a permit holder cannot obtain the necessary rights-of-way for the project, the permit holder can acquire the rights-of-way through an eminent domain proceeding in the federal district court where the property is located….A right-of-way acquired in an eminent domain proceeding is a taking of private property for which the landowner must receive just compensation, which is the fair market value on the date of exercise of eminent domain."

However, any fluctuation or rise in real estate property values during the course of the proceeding and including any period of time due to litigation arising from such a proceeding to the time of completion of the project, if finally approved, would be locked in at the fair market value of the initial date of the proceeding, which could potentially take years to resolve.

Historically federal jurisdiction of the siting of transmission lines in states has been reserved solely for federal lands within respective states. Again, it is the state public utility commissions of each given state which have otherwise been the regulators of siting permits and applications.

Reasonably understood is the anger and angst that states' governors and states' legislators feel having recently learned of the fate of their states' own power resources and transmission, and in such an injudicious way. In his letter to the U.S. Secretary of Energy, Samuel Bodman, in November 2007 after the NIETC was finalized, Pennsylvania Governor Ed Rendell wrote, "These transmission lines will be on our land and depreciate our property values, but they may not offer any benefit to Pennsylvania consumers. This designation and action by the federal government is a blatant abuse of states' rights."

Already the first official challenge to state transmission siting authority given to the FERC or federal government, as prescribed by such EPAct 2005 mandate, has been filed for appeal. A Southern California Edison (SCE) application to the Arizona Corporation Commission, (ACC) the public utility commission of Arizona, was rejected in May 2007 by the ACC. SCE merely wanted to run a 230-mile transmission line from Arizona to California at a cost of $242 million to Arizona ratepayers.

And the benefit to Arizona? None, as it would specifically serve only Californians and their growing energy needs, not the residents of Arizona. The ACC described SCE's project as "a 230-mile extension cord" into Arizona's generation supply.

This likely is just the beginning of struggles ahead, exemplifying a dysfunctional remedy, to "fix" the U.S. power grid's growing national energy needs and the need for alternative power resources. EPAct 2005 will create an ultimate power grab for power both literally and figuratively, the sights of which the U.S. has never seen.
Now, the U.S. justice system, by use of its federal courts, will bear the brunt of such misguided energy policy, in which the American people had no role. Meanwhile, the infrastructure and power needs of Americans remain at risk from both corporate greed and political intimidation.

Copyright ©2008 Diane M. Grassi
Contact: dgrassi@cox.net

Part 1 of a Series

"Energy independence from foreign sources." A mantra repeated over and over again by Al Gore, by the Hollywood elite and by candidates running for the 2008 Presidential nomination. But rarely is it ever pointed out how this phrase is but an oxymoron with respect to United States energy policy, which becomes ever more vulnerable, not just as the result of its failing infrastructure, but from misguided public policy decisions.

And never is the topic broached publicly in how much of the U.S. energy infrastructure and lines of transmission have been consumed by a constant stream of foreign direct investors and diversified holding companies. Also unbeknownst to most consumers is that such activity was hailed from Wall Street to Capitol Hill as the answer to resolving U.S. energy woes.

And now those very foreign investors have been granted even greater leeway as now realized by such mandates of the Energy Policy Act of 2005 (EPAct) which essentially eliminated the Public Utilities Holding Company Act (PUHCA) of 1935.

And in 2007, barely after the ink dried from EPAct 2005, the Energy Independence and Security Act (EISA) of 2007 was passed by federal lawmakers and signed into law. EISA conveniently serves to obfuscate critical issues that continue to stress the U.S. electrical power grid, its energy generation and transmission capacity. Yet, EPAct 2005 has continually escaped public scrutiny and a lack of accountability in both houses of the U.S. Congress.

But U.S. energy policy and the generation of power is a complex web of public policy, law, economics, infrastructure and ever-present globalization. So for purposes of this report, and in order to best comprehend current U.S. energy policy, it will be helpful to take stock of the more recent evolution of such and to examine its many and varied elements which have changed again post-2005.

In addition to the repeal of PUHCA 1935, EPAct 2005 amended Section 203 of the Federal Power Act (FPA) which will have an unprecedented and profound impact of its own on how future transactions in the energy industry will be handled by the federal government, impact matters of states' sovereignty and regulating costs to consumers.
For over 70 years, federal laws have played a vital and critical role in the operation, production, distribution and protection of the U.S. electrical power grid. Federal laws in concert with state laws and regulations have necessarily dictated that the power grid be shielded from market manipulation and criminal behavior.

But as the nearly 100 year old power grid has aged, facing a growing population and higher load demands for power, the industry has simultaneously become more and more deregulated by mandate. And deregulation has led to less and less necessary preventative maintenance, upgrades in technology as well as necessary investment in research and development. And the poorly maintained grid in many of the areas of the country, predominantly the mid-Atlantic and northeast states, has but put even more stress upon its transmission lines.

The basic structure of the North American transmission system is made up of over 140 control centers and approximately 3500 utility providers covering over 200,000 miles. Utility generating plants, transmission and sub-transmission systems, distribution systems and customer loads travel over a two-part power grid; one in the east and one in the west. Texas has its own grid.

Compounding the vast network and intricacy of the grid is the interconnectivity and delivery of power that in many cases is incompatible with widely varying levels of equipment integrity, data systems and personnel training. It is the secondary system which supplies the distribution of electricity to consumers, where most of the power failures occur, and that which require time to repair. And the network of sub-stations feeding electricity to neighborhoods, via feeders which flow to transformers, is where supposed problems arise during local outages, further exacerbated by non-maintained equipment.

But although deregulation of the utility industry began over two decades ago, it was the 1992 Energy Policy Act which changed the way electricity was sold to local consumers for the first time. Energy companies were permitted to install their own plants and sought customers throughout the country, but not necessarily in the same geographic region. Energy brokers then entered into the picture and utilized the open market to buy and sell power. And thus began the potential unreliability of energy delivery.

Purchasing power from plants hundreds of miles away from a respective region put unprecedented burdens upon the transmission system, raising the likelihood of power failures at the local level. Most importantly, the electrical grid, as it was originally envisioned, was never designed to absorb the transmission of high voltage capacity across the continent, and especially in absence of comparable and upgraded systems in place.

Although Enron became the poster child for electrical power market manipulation, which came to light after the rolling blackouts of California in 2000 and 2001, U.S. public policy and lawmakers must be held responsible for even further erosion of federal regulations and mandates now realized in EPAct 2005.

The initial most striking change that EPAct 2005 provides is the repeal of PUHCA 1935, now amended as PUHCA 2005, and now administered by the Federal Energy Regulatory Commission (FERC). PUHCA 1935 became law after the height of the Great Depression and after the stock market crash of 1929 and was a cornerstone of President Franklin D. Roosevelt's New Deal industry legislation.

It called for the prohibition of market manipulation, specifically to prevent then super-sized utility conglomerates, to prevent mega-mergers and to prevent monopolies from overtaking geographic regions. And just as importantly, PUHCA 1935 made it unfeasible for non-energy corporations to purchase a public utility.

Such abuses led to severe problems in the electric and gas industry in the 1920's and in the 1930's when three utility holding companies owned one-half of the electric utilities in the entire U.S. Thus, the emergence and formation of the Securities Exchange Commission (SEC) in 1934, which preceded PUHCA1935, and together became essential in safe-guarding the public trust and in protecting consumers and investors alike, as PUHCA 1935 delegated multi-state utility ownership regulation to the SEC.

Fast-forward to February 8, 2006, six months to the day of the enactment of EPAct 2005, when the official repeal of PUHCA 1935 was realized. As a direct result, the SEC vacated its regulatory authority over multi-state utility ownership by holding companies and only retains the ability to protect investors, not utility consumers or to prevent mega-mergers from consolidating. And now the FERC will assume cursory merger authority over generating plants and holding companies.

The repeal of PUHCA 1935 will not only allow multi-state transactions but also mergers of distribution facilities, utilities merging with non-utility corporations, and including foreign ownership over domestic utilities. Furthermore, oil companies may now own electricity and natural gas utilities, paving the way, yet again, for the formation of cartels. In addition, construction and infrastructure companies, especially those from abroad, are eager to partake in being afforded carte blanche in the acquisition of U.S. public utility operations.

In the post-PUHCA 1935 era, no individual state or federal agency will have the jurisdictional teeth to effectively regulate the finances of U.S. public utility assets totaling more than one trillion U.S. dollars. Nor will there be required oversight of such holding or parent companies such as investment banks from speculating and investing in far riskier businesses, with utility rate-payer revenues. ‒ We have already seen evidence of such with the current sub-prime mortgage loan crisis.‒

At cost? The reliability standards of U.S. public utilities, which could have grave ramifications on U.S. national security, the U.S. economy and the well-being and safety of the American people; all with the blessings of the U.S. Department of Energy, the U.S. Congress and the global stock market.

To be continued in Part 2 of a Series.
Next Up: Energy Department Uses Power to Trump States' Rights

Copyright ©2008 Diane M. Grassi

Contact: dgrassi@cox.net

Complicit in Drug Culture

Major League Baseball (MLB) and drugs. The two have been linked for decades and their relationship has never waned. The drug ingredients are different, the players acquiring them have changed and the performance benefits have been enhanced.

But MLB has not learned much in the past couple of decades when it comes to the integrity of the game, in obeying
the law and in protecting the best interests of its athletes, its most precious commodity.

In 1985, Pittsburgh U.S. Attorney, J. Alan Johnson, implicated 19 MLB players for possession of and use of cocaine. Then-MLB Commissioner, Peter Ueberroth, imposed penalties on 11 of the 19, while none were criminally prosecuted. Similar to the BALCO case and to the recent Mitchell Report, the depth of the problem among athletes using cocaine or illegal drugs made for sensational headlines.

But the way in which the drug culture was arguably enabled by MLB and its subsequent punishments were laughable and was perhaps the precursor to the abuse of steroids and HGH in the 1990's and into the 21st century.
Although it was documented at the time that at least 40% of MLB players were recreationally using cocaine in the '80's, only a handful were punished. But such star players such as Keith Hernandez, Dave Parker, and Lonnie Smith were punished not by the federal government but by MLB. They were required to perform 100 hours of community service and to avail themselves to drug testing. Four other players were suspended for 60 days. Since the drug dealers were nabbed by the feds, MLB was off the hook and essentially did what it felt was appropriate for the "good of the game."

Fast-forward to 2003 when grand jury testimony was taken in the federal BALCO investigation involving MLB's Jason Giambi, Barry Bonds, Gary Sheffield, Benito Santiago, Olympic medalist Marion Jones and NFL star Bill Romanowski, to name but a few of the few implicated. Again, only a handful of athletes from the entire professional athletic world were threatened and eventually given immunity, in order to take down BALCO President, Vic Conte, personal trainer, Greg Anderson and the illicit sale, distribution and administration of illegal performance enhancing substances.

Marion Jones will serve 6 months in prison neither for buying and illegally using controlled substances nor for her check fraud to the tune of $200,000.00, but for lying under oath to a federal grand jury about the use of drugs. Ditto for Barry Bonds. His scheduled perjury trial is to be held in April 2008.

The latest fiasco with "personal trainer," Brian McNamee, former NY Mets clubhouse employee, Kirk Radomski and MLB stars Roger Clemens and Andy Pettitte following former Senator George Mitchell's report on behalf of MLB, is but another failed attempt at exposing the so-called truth. But truth has been absent from baseball for a very long time. Moreover, implicating only 30 active players for a grand total of 89 for using performance enhancing drugs over the past decade is not only laughable but terribly sad. Given the resources and legal expenses tallied around $20‒30 million and paid to George Mitchell's law firm by MLB, the Mitchell Report's omissions should raise as many eyebrows as its contents.

But more importantly is the absence of a cry for accountability from MLB by the federal government in essentially allowing it to be in the drug business. For its owners and its teams' staff members not to admit any wrong doing is beyond arrogance. A lack of efforts to look into those areas in which there was first-hand knowledge of possible illicit drug use or non-credentialed employees working in the area of strength training was but blind neglect.

To wit, according to the Mitchell Report, San Francisco Giants General Manager, Brian Sabean, was alerted by the Giants' staff athletic trainer, Stan Conte, that a player had asked him about whether he should buy steroids from Bonds' personal trainer, Greg Anderson, as far back as 2002. Additionally, the Giants' longtime equipment manager, Mike Murphy, found syringes in the locker of catcher Benito Santiago.

Conte said he reported both incidents to Sabean immediately. Sabean told Conte that if he had a problem with Bonds' trainer he should handle it himself. But it was obvious to Conte that it was not his place to confront Barry Bonds. And apparently no one else in the Giants organization felt it was their place either, as per their MLB obligation to report illicit drug use.

Brian Sabean stated in the Mitchell Report that he "was unaware of the obligation to report drug use to the Commissioner's Office." Former Mets General Manager, Steve Phillips, and Kirk Radomski's employer, also plead ignorance on reporting illicit drug use to the Commissioner's Office. Ironically now, Phillips is paid by ESPN to analyze and to inform the public about MLB's policies.

Greg Anderson was given full accessibility to the Giants' clubhouse. Stan Conte did not believe it was proper let alone legal. But in order to placate Bonds, the Giants also accorded him two additional trainers, Harvey Shields and Greg Oliver. All three traveled with the team. In fact, Oliver and Shields were added to the Giants' payroll to account for their presence in the clubhouse, whereby they could advise other players as well.

Peter Magowan, CEO and Managing Partner of the S.F. Giants asked Sabean whether the Giants "had a problem" with regard to steroids after reading the news concerning the BALCO case and Greg Anderson, according to the Mitchell Report. But Sabean told Mitchell he did not recall that conversation.

The issue was not only that of illicit drugs permeating the Giants' locker room but the issue of personal trainers, such as Greg Anderson giving out advice about steroids. None of Bonds' trainers were certified to give out that advice nor licensed to either dispense of or speak about drug administration. Their certifications and schooling as personal trainers is also in question.

The lack of background checks on supposed strength coaches and personal trainers was rampant in MLB until 2004 when MLB limited access to clubhouses by personal trainers and ancillary clubhouse personnel not on the payroll. Due to the BALCO case, MLB did it more for security reasons, as the vetting of a trainer's certification and background still has many lapses, to say the least.

In 2004, Sandy Krum, former assistant athletic trainer for the Chicago Cubs, was terminated, he believes, for informing Cubs' General Manager Jim Hendry that head athletic trainer, Dave Groeschner, was operating without an Illinois state required license. Unlike a personal trainer, an athletic trainer works under the auspices of a medical doctor and 43 states require such a license. Additionally, athletic trainers are not authorized in Illinois or NY to give injections to players. Coincidentally, Groeschner followed Cubs Manager Dusty Baker from San Francisco. In 2005, the Cubs fired Groeschner. Dusty is now with the Cincinnati Reds.

We have heard ad naseum about the McNamee-Clemens soap opera which will be played out before the Congressional House Committee on Oversight and Government Reform on February 13, 2008. But little light has been shed upon the underlying facts about how McNamee helped weave his own web, in which the Toronto Blue Jays and the NY Yankees play no small part.

McNamee earned an undergraduate degree from St. John's University in NY where he played on the baseball team as a catcher but did not have enough talent for MLB. He then followed his father's lead and joined the NYPD in 1990. He was an officer for three years, serving two years undercover and then quit the force. He was suspended for 30 days at the end of his service for allowing a prisoner to escape from custody, but said he took the fall for someone else.

Former St. John's school mate, Tim McCleary, was the assistant General Manager of the Yankees in 1993 and hired McNamee as the bullpen catcher, where he stayed until 1995. McNamee then decided to get into personal training. In 1998, McCleary was hired by Toronto, and he then hired McNamee as a strength coach and where he met Roger Clemens. He also befriended Jose Canseco who at the time was also a Blue Jay.

After Clemens was traded to NY in 1999, McNamee joined him in 2000 when the Yankees put him on the payroll as a strength coach as well until 2001, when allegations immerged of rape and illegally giving the involved woman GHB ‒the date-rape drug‒ a nearly fatal dose. Charges were not filed as the woman did not want to pursue them supposedly because she was having an affair with one of the Yankees' married players. But McNamee was spotted having sex with a nearly comatose woman in one of the team's hotel pools on the night of a Devil Rays game in St. Petersburg in October of 2001. His account to police was filled with inconsistencies, including denying he was the man in the pool when spotted by security and another Yankee staffer. Again, McNamee was the victim.

GHB is illegally used by athletes to recover from strenuous workouts and was also part of McNamee's medicine cabinet. Even so, Clemens gave McNamee the benefit of the doubt about the alleged rape. The Yankees, however, let McNamee go before the 2002 season without disclosing the reason. But Clemens hired him as his personal trainer and employed him through June 2007. Andy Pettitte also paid McNamee for his training services during that time.

McNamee's credentials were never checked by either the Toronto Blue Jays or the NY Yankees. During their employ of his services he was never a certified strength coach. He may have been a personal trainer, but certification is not legally required to be a personal trainer, although such certification only requires an exam and no course work or field training.

McNamee's credentials are dubious at best, not to mention his phony PhD that he acquired in 2000 from an implicated internet diploma mill known as Columbus University, supposedly located in Louisiana, and since sold off to another entity in another state due to its being nailed by authorities.

McNamee was advertising himself on the internet as Dr. McNamee, PhD in order to market his In-Vite nutritional supplements and his strength training services. He was also getting involved in other enterprises which Clemens was helping to bankroll to help out his career. Although McNamee made claims he was certified, he was not certified as a strength coach until nearly 2006.

According to Dr. Jeff Falkel, Chairman of the Executive Council Certification Commission of the National Strength and Conditioning Association, (NSCA) recently on Will Carroll's BaseballProspectus.com radio show, stated that McNamee did not even take his Certified Strength Conditioning Specialist exam until October 2005.

And unbelievably, MLB does not require certifications of its personal trainers or strength coaches but does require its staff athletic trainers be licensed only as required by law. The NFL, NBA, NHL and NCAA are also lax about certifications other than athletic trainers who work with medical physicians. They still do not require that their strength trainers be credentialed by the NSCA.

What we can conclude from this unveiling of the lack of professionalism and clubhouse culture throughout MLB is that without the cooperation of all of its participants, from the executive level on down to the groundskeepers, it cannot be trusted to police itself, based upon its putrid record thus far. And the business decisions made on the executive level from Commissioner to owner to GM to player to staff employees has been dismal and in disrepair.

Ultimately, greed has been the prevailing culprit, influencing both owners and players alike. But to single out a few super stars will never cure baseball or professional sports of its ills. It is shortsighted by MLB and not surprisingly so by our U.S. Congress. While there is no ready solution, using some common sense might be a good start.

Copyright ©2008 Diane M. Grassi

Contact: dgrassi@cox.net

The announcement on May 21, 2007 that the largest public company in the Middle East, by market value, would be acquiring a division of the world's second-largest corporation, by market value, and based in the United States, could not have been any less publicized. But in the world of corporate governance, the largest transaction ever completed in the Persian Gulf, seemingly trumps all laws of reason.

However, there is little precedence established for a foreign owned totalitarian government controlled corporation acquiring a corporate entity in the U.S. Such brings us to the General Electric Co. and the sale of its GE Plastics, based in Pittsfield, MA. It has been one of its most successful divisions for over half a century. It includes numerous U.S.-based manufacturing plants and research and development offices, with additional locations spanning 20 countries. Employees total nearly 11,000 worldwide, with several thousand located in the U.S. New operational control, however, will be via offices in Saudi Arabia.

The Saudi Basic Industries Corporation, known in the Middle East as SABIC, is one of the world's 10 largest petrochemical manufacturers and is 70% owned by the Saudi Arabian government, controlled by the Royal Saudi Kingdom and 5 other states of the Gulf Cooperation Council, including private Middle Eastern investors.
It employs approximately 17,000, worldwide, and shortly expects to be the new owner of GE Plastics in the U.S.

After GE Plastics was put on the market in January 2007, it got bids from Apollo Management, Inc., a U.S.-based private equity firm as well as Bassell, a Netherlands-based Access Industries plastics maker. Both proposed bids of GE Plastics were upwards of $10 billion. But it was the Saudi Arabian's offer of $11.6 billion in cash and the promise of future energy ventures with its parent company, GE, which gave SABIC the upper hand in the acquisition of GE Plastics.

Wall Street portfolio managers will liken those opposed to this deal, still pending approval by the U.S. government through the Committee on Foreign Investments in the U.S. (CFIUS), as protectionist, nativist and alarmist. And the U.S. has seen propositions like this before recently, such as the Bush Administration's desire in 2005 to allow foreign ownership of U.S. airlines; the proposal by the People's Republic of China's state-owned CNOOC in the summer of 2005 to acquire UNOCAL of California, the ninth largest oil company in the U.S.; Dubai Ports World, of Dubai Holding, a United Arab Emirates (UAE) government-owned corporation, and its buyout of the United Kingdom corporation, Peninsular and Oriental Steam Navigation Co. (P&O), for its port operations of six major U.S. East Coast ports in early 2006.

All of the aforementioned never came to pass, after much Congressional and public opposition, although the Bush Administration promises to revisit foreign airline ownership. However, Dubai Holding, the same UAE controlled company yearning to takeover U.S. ports was successful just months later in 2006 in acquiring the U.S. operations of Doncasters Group Ltd., a UK company based in Connecticut, and a manufacturer of precision aircraft engine parts for U.S. military and commercial aircraft engine parts manufacturers, like its competitor, GE Aviation.

GE claims that the prohibitive cost of petroleum, especially over the past year, has necessitated its sale if its plastics division, as it requires petrol for the manufacture of plastics and its various composites and resins. And although GE made a fair profit in 2006, it fell short of its 10% projected goal.

Less important to GE Plastics, however, is that there has been nothing firmly documented by SABIC, other than through verbal overtures, that they will continue to maintain GE plants in the U.S. According to SABIC CEO, Mohamed Al Mady, "We have no other plans at this time." On the other hand he notes, "SABIC's intention is to grow globally." At least one of the U.S. plants is non-union, that being the one located in Selkirk, NY and over the long haul questions remain as to whether or not SABIC will move all operations to Saudi Arabia, closer in proximity to its oil fields, or to China where it currently has petrochemical operations.

Questions must also be asked when it comes to the rights and wages of American workers, who will take directives not just from a Chairman of the Board but from the Saudi Royal Kingdom, which presently restricts the rights of women in the workplace in Saudi Arabia. They are only allowed to work, and in limited industries, provided permission is granted by a male relative. And although technically Saudi Arabia must obey U.S. laws pertinent to ownership of a corporation located in the U.S., cultural differences steeped in a totalitarian regime practicing Shariah law may not properly translate to the American way of life.

Additionally, SABIC would have to adhere to the regulations of the Environmental Protection Agency (EPA), such as the 1980 Superfund Law, holding corporate toxic waste polluters accountable. Such requirement is non-existent in Saudi Arabia or China. GE Plastics was mandated to clean up the PCB's in the Housatonic River in Massachusetts and GE the Hudson River years ago, both fighting the federal government for years until a settlement was reached with the EPA and the U.S. Department of Justice in 2005. Ongoing completion and monitoring of said cleanup still remains in both bodies of water. But will SABIC fulfill GE Plastics' obligations?

Founded in 1930 as a division of GE, GE Plastics arose from the initial results of Thomas Edison's experiments with the use of plastic filaments in the electric light bulb as early as 1893, followed by the success of its Bakelite® synthetic plastic created in 1909. The plastics industry, however, primarily blossomed after former GE CEO, Jack Welch, assumed control of the plastics division in 1960 and with the birth of its world famous patent Lexan ® polycarbonate.

GE Plastics specializes in plastic polymers, plastic composites and insulating resin polycarbonates, among others, used in both government and commercial sectors in nearly every industry including building and construction, transportation, aviation, auto body manufacture, defense, law enforcement, healthcare, telecommunications and computer and semi-conductor technologies. And it is doing business in such lucrative and specialized areas which SABIC opines. While its consumer product contracts are extensive, they are but part of GE's vast plastics' business portfolio.

SABIC was established by Royal Decree in 1976 as instituted by King Khalid Bin Abdulaziz, and the present Saudi Kingdom or government claims it has a hands-off approach to the business operations it owns. SABIC was originally set up to operate the hydrocarbon and mineral-based industry in the Kingdom of Saudi Arabia. It has had an operation named SABIC Americas in Houston, TX, for many years, which employs 200 and where it houses the SABIC Technology Center. Details on its exact business operations in the U.S. presently, however, remain scant.

Although the polycarbonate and plastic resin composites industry has been gaining steam over the past 10 years, in light of continual rising oil costs in the U.S. and continued U.S. dependence upon oil, primarily in the Middle East, it has quickened the pace of growth over just the past two years. And with less U.S. oil refineries expected to come online in the near future, in order to mitigate high fuel costs, lighter weight components are desired for automobiles, and commercial, transport and military aircraft in their manufacture.

GE commercial and military aircraft engines have long utilized polycarbonate composites for fan blades and fan cases, since 1995 with the GE90 engine, and the soon to be released GENX engine for commercial wide-bodied jets. Composites are not only light in weight, but corrosion resistant, heat resistant and their longevity and reduced maintenance, as opposed to metal parts, are preferable. Semi-conductor technology as well as use in watercraft, such as submarines, are other examples of the use of plastic composites. The historical integration of composites used in both military and commercial aircraft engines however, originally stemmed from military aircraft engine use of polycarbonate components.

Nevertheless, financial market experts as well as political prognosticators have already decided that CFIUS will give the SABIC-GE Plastics deal its seal of approval with no national security issues at all to arise. Therefore, the deal is expected to close in the 3rd quarter of 2007. And while GE Plastics may not be a direct contractor or supplier to either government or commercial entities, it still could have national security implications.

And it does not completely dismiss the fact that the U.S. government will be dealing with the Saudi Royal Kingdom-state government as it assumes the laws and regulations of the U.S. Any contracts which GE Plastics previously had and which remain active, with either its parent company GE or directly with other corporations or government agencies, would supposedly transfer to SABIC. Such government agencies for which GE Plastics could have existing contracts with are the Department of Transportation (DOT), the Department of Defense (DOD), the Department of Homeland Security (DHS), the Federal Emergency Management Agency, (FEMA), the Federal Aviation Agency (FAA) and the National Aeronautics and Space Administration (NASA), to name but a few.

And based upon the lack of underlying history of this more than unusual corporate arrangement, a more thorough review might be warranted by CFIUS, which is an inter-agency committee chaired by the Secretary of Treasury. Rather than its routine 30-day investigative period, it could self-impose the more thorough 45-day review process. For as much as the U.S. government as well as the government's industrial complex wishes to favor the promotion of global trade above that of national security, in an age of political correctness, the fact is, the U.S. military is engaged in two simultaneous wars in the Middle East. And it would perhaps be better to use more deliberation and discretion rather than to rubber-stamp such an acquisition.

The Exon-Florio Amendment, which emerged in 1988, amended Section 721 of the Defense Protection Act of 1950, as part of the 1988 Omnibus Trade and Competitiveness Act of 1988. The statute authorized the President of the U.S. to block or suspend a merger, acquisition or takeover by a foreign entity if there is credible evidence that a "foreign interest exercising control might take action that threatens to impair the national security" in the event existing law does not provide "adequate and appropriate authority for the President to protect the national security in the matter before the President."

Equally deceptive in the process, whereby foreign governments or foreign owned corporations purchase a U.S. owned entity is that they then become indirect stakeholders in U.S. public policy as well. They not only access capital gains but gain political clout on Capitol Hill too. Such opportune objectives of a foreign nation do not just begin during the corporate bidding process, however, but requires a methodology of lobbying dealmakers otherwise known on Capitol Hill as the U.S. Congress. To wit, the Saudi Arabian government spends $20 million annually to lobbying organizations and law firms representing them in order to gain exclusive access to lawmakers in advancing such financial interests or specific foreign trade policy agendas.

For example, former Secretary of State, James Baker, a senior partner in the law firm, Baker Botts, LLC, of Houston, TX, is legal representative to Saudi Prince Sultan bin Abdul Aziz, one of several Saudi persons, entities, Islamic foundations and financial institutions named as defendants in a pending lawsuit brought by the 9/11 Families to Bankrupt Terrorism.

And lastly, but no less important, in the last frontier of U.S. fire sale economics, concerns the type of financial instruments which will be used for the SABIC-GE Plastics transaction promising GE $9 million in cash, after taxes. In mid-2006, SABIC set up an Islamic finance arm to oversee its domestic Islamic bond issues. Since the United Kingdom is home to two Islamic banks, sukuks, or asset-based Islamic bonds, are readily marketed to international investors. SABIC plans to finance $2.2 billion of the GE Plastics deal by issuing bonds. The finance group and underwriters for the SABIC-GE transaction are the combined CitiGroup, Inc., HSBC Holdings Plc, Amro Holding NV and GE Capital, a division of GE, GE Plastics' parent company. Bonds are expected to be sold in Europe and in the U.S.

Of note, is that in April 2006, Dow Jones and CitiGroup launched the first Islamic Bond Index, created specifically to assess global bonds' compliance with Shariah investment guidelines. Shariah law dictates that such money be used for only those purposes compatible with Islam. But there are potential difficulties with such transactions in that they are specifically Shariah law compliant instruments and may conflict with U.S. law.

Presently, it has not yet been decided by SABIC if in fact it will exclusively issue Islamic bonds for the purchase. But the complexities involved in the GE Plastics sale is anything but straight forward and for that very reason is deserved of more scrutiny, analysis and caution from not only CFIUS but from the U.S. Congress.

And U.S. Congressional representatives should be far less mindful about critics' scorn and far more concerned with their dutiful obligation to govern in the best interest of the American people and their responsibility to use foresight in order to best preserve America's future and its assets.

Copyright © 2007 Diane M. Grassi
Contact: dgrassi@cox.net

On March 23, 2005, U.S. President George W. Bush, former Canadian Prime Minister, Paul Martin and former Mexican President, Vicente Fox, authorized the Security and Prosperity Partnership (SPP), now under the auspices of the U.S. Department of Commerce. Most Americans have little to no knowledge of this seemingly innocuous sounding unofficial treaty and therefore believe there is little reason to be alarmed.

However, what could be misinterpreted as legislation which has been scrutinized, and has gone through the proper channels of government could not be farther from the truth, in that the U.S. Congress has had no direct disclosure of nor has taken part in its execution.

Legally, a treaty would require a two-thirds majority of the U.S. Senate to concur for its ratification as determined by the U.S. Constitution. Cleverly, however, since the SPP is not a treaty, the President was able to avoid such a required procedure by using the power of the Executive Branch. And in August 2006, President Bush additionally crafted a Signing Statement to passed legislation declaring it Constitutional for his administration to withhold information from or deny authority required from the U.S. Congress on the SPP and its negotiations.

With the recent swell and frequency of free trade agreements being passed in the U.S. Congress in the past few years alone, seemingly rushed through without genuine debate or challenge, it would be easy for the public to assume that the SPP was authorized by Congress and thinking matters pertaining to it were in the best interest of the American people. And sadly, many U.S. free trade agreements do not directly better the workers of the countries involved, but are solely reserved for big business profiting from cheap labor, and foreign lobbyists and bureaucrats enriching themselves.

But the SPP is cleverly disguised as a boon for all three North American countries and its citizens, yet has lacked input or oversight from federal, state, or municipal legislators nationwide. The goals of the SPP agenda largely include a call for transparency and unprecedented cooperation with respect to all three governments' commerce and trade. The endeavor is to join forces in uniting as one competitive body in the global marketplace and to function as the North American Union (NAU), which at the same time whittles away at each country's sovereignty, its national security and its laws.

The facilitation of the SPP will stem from the use of the U.S. interstate highway system providing the roads for inter-continental and interstate commerce. For that to happen will require retro-fitting of existing interstates as well as building new roads, including gas and power lines, including light rail, from the interior of Mexico, through the central corridor of the U.S. and on into Canada.

Both the proposed NAU and NAFTA Superhighway are offshoots of the North American Free Trade Agreement, signed in 1993 by then President Bill Clinton. At the time it was sold to the American people and the Mexican government as a win-win for both peoples and would re-balance the flow of trade back to Mexico in order for Mexican workers to earn a living wage. But that never transpired and instead backfired, resulting in the onslaught of nearly 20 million illegal aliens since, illegally crossing the U.S. southern border, supposedly looking for decent paying jobs.

But to fully understand the evolution of the call for the need of a NAFTA Superhighway it is important to at least understand the recent history behind it. The introduction of free trade policy has morphed into a priority of the U.S. government today, even putting national security at risk in order to fulfill its agenda. It was the Reagan Administration's vision of free trade, a direct response to Japan's explosive growth and expansion in both the automobile and electronics industries in the U.S., which began to shift the balance of trade and the lopsided result we now have today with most of our trading partners.

And fifteen years since the passage of NAFTA has not only enabled the U.S. to globalize arguably beyond proportions in all areas of commerce, industry and trade, but it has helped to foster public-private partnerships, a benign term used to mask what are essentially foreign-direct investments. And foreign-direct investment has grown precipitously since 1988 when former President George H.W. Bush signed the Exon-Florio Amendment to the Defense Production Act of 1950.

It was also in 1988 when the President, through Exon-Florio, delegated his power to approve or disapprove such foreign acquisitions to the Chairman of the Committee on Foreign Investments in the U.S. (CFIUS), relieving the President of the responsibility in determining national security threats in foreign-direct acquisitions. Unfortunately, the definition of national security in a post-911 world remains too narrow to address protection of critical infrastructure, a scarce defense supply, or preservation of technological standards, among many other risks, unquestioned back in 1988.

The Exon-Florio Amendment authorizes the President to "suspend or prohibit foreign acquisitions, mergers, or takeovers of U.S. companies if a foreign controlling interest might take action that threatens national security." And the term "foreign control" remains ambiguous and decidedly so. The ramifications of the Exon-Florio Amendment reared its head when in February 2006 CFIUS, an arm of the U.S. Department of the Treasury, became widely recognized for its authorization of the Dubai Ports World to operate multiple East Coast port operations including the Port Authority of New York, and the ports of Baltimore and Miami.

The balancing act of national security and foreign-direct acquisitions has relegated national security concerns to that of an afterthought, as the Department of the Treasury's prime priority is expanding commerce in the global marketplace. Complaints about the secluded CFIUS process, however, predate the Dubai Ports World alarm bells of 2006. For it was in October 2005 when Senator Richard Shelby, (R) Alabama, called for hearings on the inclusion of Congressional oversight of CFIUS approvals. And it was prior to 2006 when Senator James Inhofe, (R) Oklahoma, lobbied for Congress to be able to reject CFIUS approvals.

As it stands, most every foreign acquisition sails through the approval process. Unless there is a 45-day investigation process after the required 30-day review by CFIUS, the President's approval is not required and thereby never reaches the Congress for any interaction or input. Between 1988 and 2005 only two foreign acquisitions were unapproved out of 1,555 reviews. Both were withdrawn and eligible for later re-instatement.

Many foreign entities seek out a "pre-screening" with CFIUS' member agencies, comprised of 12 departments of the U.S. government, if national security concerns are anticipated in order to mitigate the chances of non-approval and triggering the 45-day investigation.

The disparate interests of free trade and the protection of critical infrastructure, and in particular the U.S. highway system as well as public utilities, has given way to high-powered U.S. law firms and professional lobbyist organizations that lay the groundwork for foreign conglomerates to land foreign-acquisition contracts with cash-starved states amenable to foreign-direct investment.

Such is the case with the Trans-Texas Corridor (TTC), the brainchild of the Texas Department of Transportation (TxDOT) in concert with the SPP. It is a multi-billion dollar web of highway building, toll road maintenance, gas pipelines, public utilities and railroad contracts as complex and as multi-layered as the U.S. interstate highway system itself. A flurry of over 20 foreign acquisitions of interstate highway projects and toll road maintenance contracts have been approved since 2003 with many more nationwide working their way through state legislatures, such as that of the New Jersey Turnpike which Governor Jon Corzine believes is ripe for foreign funding.

But the TTC is the biggest and most massive highway building project of them all and for the first time will rely upon a foreign entity to not only maintain toll roads but to have a stake in building, controlling operations and tolls and expanding new roads and critical infrastructure. Additionally, eminent domain law will come into play in order to reconcile the taking of property and farmland for road expansion to accommodate pipelines and railroad tracks.

And much like the SPP planning, which took place behind closed doors, the TTC collaboration began in 2002 in Texas Governor Richard Perry's chambers, where state legislators and taxpayers were deliberately cut out of negotiations and the bidding process. Negotiations began with the Spanish engineering transportation construction firm, Cintra Concesiones de Infrastructures de Transporte, S.A., a subsidiary of the Grupo Ferrovial, which specializes in toll roads and car parks and considered a leading developer of private-sector infrastructure throughout Europe.

At the center of negotiations for multiple legs of the Superhighway Corridor throughout Texas, is none other than Rudolph Giuliani's law firm which landed the Comprehensive Development Agreement for a widening of Interstate-35, now referred to as the TTC-35, in addition to the Master Development Plans for State Highways 121 and 130 among other legs of the TTC. All negotiations for Cintra were and are presently handled by the law firm, Bracewell & Giuliani, LLP, of which Republican Presidential candidate, Rudolph Giuliani, has been a senior executive partner since March 2005. His law firm is the exclusive legal counsel for Cintra. Bracewell & Giuliani is comprised of 400 attorneys, based in Houston, TX with offices in New York City, Washington, D.C., London and Kazakhstan.

Cintra joined with San Antonio, TX-based Zachry Construction Corp. to help land the contracts, in which Zachry owns a 20% interest. The Cintra-Zachry proposal for TTC-35 includes a private investment of up to $6 billion in upfront payments for the complete construction, design and operation of a 316-mile toll road between Dallas and San Antonio, giving Cintra the right to set tolls and keep toll road profits for a period of 50 years, as it will for each road it has contracted.

The NAFTA Superhighway and its corridors will run from Southwestern Mexico through Laredo, Austin and Dallas, TX, into Kansas City, KA, serving as an inland customs port. The corridor will split in Kansas with one leg going to Winnipeg, Canada through Omaha, NE. The other leg goes to Toronto, Canada through Des Moines, IA, Chicago, IL and Detroit, MI.

As many as 10 lanes, one-mile wide will incorporate double rails and pipelines. The second corridor is planned from Brownsville to Houston, TX through Arkansas, Memphis, TN and into Norfolk, VA. While the principal use for these corridors is to speed Asian goods into the Central and Eastern U.S., it will require 145 acres of land per mile or 540,000 total acres of land. And in Texas, the state may utilize its own discretion in using eminent domain law in order to reach its goal.

Had gasoline tax revenues been properly allocated and solely reserved for highway projects over the years, neither Texas nor numerous other states would be as desperate for funds as they claim they now are, as many highway funds have been found to have been raided for other state projects and public funding.

The citizens of Texas only as recently as February 2007 began to attend state legislative hearings where many state lawmakers themselves were beginning to become familiar with the Cintra contracts. Several have called for a moratorium on at least the TTC-35 project, envisioned as a high-speed highway, until they can evaluate issues such as eminent domain, cost benefit analysis, environmental impact and homeland security ramifications.

Most interesting to the whole story is not only has Mr. Giuliani's involvement in the NAFTA Superhighway not ever having been publicly addressed, but how a foreign company is awarded the building of a mass highway system, versus maintaining it, for the first time in U.S. history, and negotiated by the law firm of the top Republican candidate running for President of the United States. And truly disturbing is how such will not only have national and homeland security and sovereignty implications but how it is deliberately being kept away from the Halls of Congress.

Giuliani fancies himself as an expert on homeland security issues and a law enforcer. And he has amassed quite the portfolio since 2002, earning $20 million in that year alone, by selling himself as such. He owns Giuliani Partners, Giuliani Safety & Security and Giuliani Capital Advisors. In March 2007 he sold Giuliani Capital Advisors, a former Ernst & Young finance company he purchased in 2002, to Macquerie Infrastructure Consortium. Not coincidentally, it is a partner of Cintra's in its shared operations of toll roads in both Indiana and Chicago, IL.

Bracewell & Giuliani represents some of the biggest multi-national oil, utility infrastructure and financial corporations both in the U.S. and abroad. With that have come the connections that Giuliani has been able to tap into for campaign donors, essential for his presidential bid, not only in Texas but nationwide, as he has become the consummate globalist. But more troubling than potential conflicts of interest as a public servant is his lack of compunction to secure U.S. borders and then planting himself squarely in the middle of one of the most controversial and historic highway system projects since the 1956 National Federal-Aid Highway Act.

Particularly unnerving, given Guiliani's personal experience on 9-11, is his defense of open borders at any cost while condoning the NAFTA Superhighway Corridor and by extension the North American Union, without the purview or consent of the U.S. Congress or the will of the American people.

We should have seen it coming when Giuliani enacted Special Order 40 in 1994, during his tenure as Mayor of New York City, in ordering law enforcement officers to no longer check the legal status of suspects caught violating the law. We should have seen it coming when Rudolph Giuliani single-handedly decided that illegal aliens were not lawbreakers and also quit upholding the law. And unfortunately we now do see it coming. But sadly, he may now actually be handed the opportunity to no longer defend and abide by the U.S. Constitution of the United States of America.

Copyright ©2007 Diane M. Grassi
Contact: dgrassi@cox.net

The tragic explosion of the Sago Mine in West Virginia on January 2, 2006, which took twelve lives and permanently disabled another, still begs for a rational explanation over 1 year later. The disaster captured the interest of the American public and fostered outrage on the part of lawmakers and bureaucrats alike, while coal mining operators ran for cover.

For not only did the International Coal Group, Inc., which owns and operates the Sago Mine, become the poster-child for unsafe mining practices, it became the source of questions which had not been publicly exposed for decades, while miners' lives remained in peril.

And questions linger as to why existing federal and state safety laws were overlooked by government agencies and regulations bypassed by the coal industry. Still, there was a knee-jerk reaction for more federal legislation rushed through the halls of Congress and various state houses where new laws were enacted in those mining states which lost miners in 2006.

The direct cause of the Sago Mine explosion has yet to be confirmed by the state of West Virginia, the federal Mine Safety and Health Administration (MSHA), the United Mine Workers Association (UMWA) and independent commissions with reports supposedly forthcoming. 2006 saw the largest percentage increase in U.S. coal mining deaths in 107 years, the industry's highest number since 1995, and more than double that of the 22 in 2005. Yet, explanations for such an increase are varied, depending upon which interested party provides them.

This writer wrote an extensive report one year ago regarding background on federal regulation of the mining industry, its lack of government enforcement, the industry's deregulation over the past several decades and the industry's accelerated recent growth which are all contributing factors to the decline in mining safety.

And although such may help give a historic context of the dysfunction, it offers no confidence whether or not coal mining is functionally in a better place 1 year after Sago. Heightened awareness of negligence, whether blind or intentional, is the first step to increased improvement, but there are many more required to assure miners and their families that their lives are in less danger and remain a priority.

Preliminary reports by the West Virginia Office of Miners' Health, Safety and Training (WVMHST), the International Coal Group, Inc., the MSHA and independent commissioned studies such as the Mine Safety Technology and Training Commission cite contributing factors to the loss of life in Sago Mine.

But without substantial scientific evidence, 3 bolts of lightning strikes remain the official cause for igniting methane gas causing the explosion. And such remains mere speculation and without foundation to mining experts and scientists alike. At issue, is how lightning could travel over two miles and 900 feet underground through twists and turns on its way to a closed-off section where the miners were located and cause the eventual explosion.

Additionally, the underground mine seals used for the walls were manufactured with materials unable to withstand the minimally mandated 20 pounds per square inch (psi). However, the sustained blast of Sago was 95 psi. Engineers are now experimenting with new composites able to handle over 95 psi. To date, there exists no credible material to handle such an explosion although the MSHA amended the requirement for mine seals to be 50 psi in 2006.

It was the loss of life at Sago Mine as well as the two subsequent West Virginia coal mining deaths but weeks after Sago on January 19, 2006 in a fire at Aracoma Mine, followed by the disaster at Darby Mine No. 1 in Harlan County, Kentucky which took 5 more lives on May 20, 2006, that resulted in the expedited federal Mine Improvement and New Emergency Response Act of 2006. President George W. Bush signed it into law on June 15, 2006. And just weeks after the Sago Mine explosion, West Virginia Governor Joe Manchin executed new mining laws on January 26, 2006 which followed his order for a special investigation by the state of West Virginia into causes of the Sago disaster.

By February 7, 2006 the WVMHST announced the provisions of its emergency regulations mandated by the legislature. They included providing emergency shelters within 1,000 feet of where miners are digging coal; inspection of air supplies daily and reporting results to the state; installation of caches of emergency air supplies equal to 30 minutes of walking time; wireless communication devices capable of reaching the surface through text, voice and by location.

Similarly, Kentucky passed legislation which became effective July 12, 2006 as it suffered a total loss of 16 miners in 2006. The law includes such changes as requiring mine managers to report a serious injury or fatality to state officials within 15 minutes, requires 2 air packs for each miner and provides for escape drills to be conducted every 90 days. Kentucky also now has the power to fine mine operators for violations and to increase from 2 to 3 the number of underground inspections annually.

Meanwhile, the U.S. Congress swiftly cobbled together its own revised mine safety regulations, the first since 1996, after its hearings on Capitol Hill in January 2006, following the Sago Mine explosion and the Aracoma Mine fire fatalities.

The federal law revisions include providing 2 hours of emergency air supplies per miner, plus caches of air packs with an additional 2 hours of air per miner. Previously, only 1 hour of air per miner was required. Mine operators must report a disaster within 15 minutes whereas previously there was no time limit. Two separate and protected communications systems are required. Previously only one was required. Wireless communication and miner tracking systems are required to be operational within three years of June 15, 2006.

Additionally, two experienced rescue teams must respond to mining accidents within 1 hour as opposed to the previous 2 hours and the development of training of emergency response and evacuation plans have been enacted. The MSHA has also added approximately two dozen more federal mining inspectors and mandates a change in its violation fee structure. Unfortunately, there remain less federal inspectors than the U.S. had in 1997.

The federal government is also now given the authority to request an injunction to shut down those mines which have refused to pay final violations. But the appeals process remains lengthy and during such process mines may remain open indefinitely, regardless of aggravated negligence. And the aggregate fines remain benign or seemingly small for an industry which set historic revenue records in just the first nine months of 2006.

"Dramatic changes in our mine safety laws will only protect our miners if MSHA is displaying real teeth in carrying out and enforcing our new requirements," this according to Senator Jay Rockefeller (D-WVA) on Capitol Hill with the MSHA in the first week of December 2006. He and Senator Robert Byrd (D-WVA), both predominantly responsible for the amended federal mining law of 2006, met with the MSHA and a bi-partisan committee in order to ensure industry compliance of the new law and to ask the agency if it has enough funding to implement the provisions of the new Mining Act and its safety measures.

As of January 2007, there are no new air packs available. Yet, mine operators believe they have satisfied the new regulation as the law only requires purchase orders, not receipt of air packs, as proof of compliance. Mine operators have been told that air packs are on back-order for 1 more year, although a German manufacturer has 6,500 units readily available. And the Self-Contained Self-Rescuers (SCSR) are the same type of devices used since 1977, when the first major underlying changes in mining safety laws were enacted.

But strengthening seals, improving breathing technology, building refuge chambers and creating communications and tracking technologies have thus far only been appropriated $10 million for the necessary research and engineering evaluations and thus remain to be implemented. And again, a new round of Congressional hearings on mining safety has been called for in 2007, this time by Congressman George Miller (D-CA), the new Chairman of the House Committee on Education and the Workforce.

Idly standing by waiting for the federal government to fund the necessary changes in the law or waiting for mine operators to police themselves in the meantime are both unrealistic and foolish premises. J. Davitt McAteer, former had of the MSHA (1994-2000) and now an expert advisor to West Virginia Governor Manchin, believes that, "Default steps or common sense while the industry waits for technology to be improved have not been taken." What caused the explosion and what caused the disaster, according to McAteer, are distinct.

The lack of explosion proof seals, defective air packs, lack of communication devices, delay in rescue response and non-existent tracking capabilities were preventative measure which could have been put in place long ago. And Cecil E. Roberts, President of the UMWA, has called upon the MSHA to regulate evacuations during the approach of electrical storms, as long as questions remain as to the exact cause of the Sago Mine explosion.

Sadly, on September 7, 2006, Sago Mine's operator, ICG, Inc., was again cited by the WVMHST for providing its miners with defective SCSR breathing apparatus. The devices had faulty heating indicators. 6 out of 50 had been exposed to temperatures over 130° F. Disturbingly, said violations only became public knowledge three months after they were served.

And already in this young 2007, two miners in West Virginia lost their lives on January 13, 2007 as the result of a roof collapse at the Brooks Run Mining Co.'s Cucumber, WVA mine. The Brooks Run mine had been cited by federal inspectors 65 times in 2006 with penalties totalling only $5,000.00. Although mine operators notified authorities immediately in compliance with the new mining law, little else has changed in 1 year's time. For as Cecil Roberts continues to preach, "When you put production ahead of safety, tragedies like this are all too often the result."

Copyright ©2007 Diane M. Grassi
Contact: dgrassi@cox.net

The ravages of war are hell and collateral damage that includes loss of life, permanent disability and war-related illness in both military and civilian populations is expected. But too often American soldiers have been stung by the treatment they have received with respect to their healthcare upon returning stateside.

Unanticipated by the United States Department of Defense (DOD), healthcare services provided returning soldiers from the War in Viet Nam and more recently the Gulf War were grossly under-funded, and the criticism that endured thereafter was a lesson thought to be learned for future U.S. military engagements. And in that effort, the U.S. military has been sure to launch continual public relations campaigns to project an image that active duty troops deployed to Operation Iraqi Freedom and Operation Enduring Freedom in Afghanistan receive the best healthcare that money can buy.

The Department of Defense's Deployment Health Clinical Center website reads, "Fostering a trusting partnership between military men and women, veterans, their families and their healthcare providers to ensure the highest quality care for those who make sacrifices in the world's most hazardous workplace." But when it comes to the mental healthcare status of troops during deployment and upon their return to the U.S., it is woefully lacking.

There is no longer a shortage of laws and regulations in place as existed during Viet Nam or during the Gulf War with respect to mandated healthcare screenings for returning soldiers. But a lack of political will by the Department of Veterans Affairs in concert with the DOD added to a lack of oversight by a lethargic U.S. Congress, has made life extremely difficult for soldiers with acute mental health problems or those hoping to avoid them by seeking help.

Multiple administrative dilemmas at play at once have impacted the quality of life for troops serving in Iraq and Afghanistan and upon their return. Immediately, due to a shortage of manpower, troops are now being re-deployed to battle as many as five times with less and less time to decompress between tours of duty. Were there not a need for so many bodies in the field, troops displaying emotional problems would be a liability and sent home for treatment.

Colonel Elspeth Ritchie, an expert in psychiatry for the Army's Surgeon General has insisted that the DOD still prioritizes the mental health of service members. But she admitted that, "Some practices, such as sending service members diagnosed with Post-Traumatic Stress Disorder (PTSD) back into combat had been driven in part by troop shortage." Absent of outwardly exhibiting symptoms of mental disorders such as PTSD, many troops fail to report their problems due to fear of retribution or are not aware there is a problem until they start acting out in other ways such as through drug or alcohol abuse.

Public Law 105-85, Section 762-767 enacted as part of the 1998 Defense Authorization Act was presented in 1997 in order to force the DOD to comply with both pre-deployment health assessment and post-deployment health assessment for returning soldiers as the result of healthcare problems them after the Gulf War. Through the filing of forms 2795 and 2796 respectively, their purpose is to trigger physical as well as mental health evaluations of troops. However, oversight of such examinations is spotty and the way in which the mental health assessment is recorded, if at all, is based upon the troop's own self-evaluation by way of answering 4 questions concerning PTSD symptoms.

The 1998 law requires evidence that face-to-face interviews are done upon demobilization, but the DOD has refused to turn over such documentation to the Congress, for the past four years, in order to verify that it has been adequately done. Therefore, all of the regulations in the world are of little use unless there is implementation of said regulations.

And leaving the care of returning soldiers up to themselves or their families is hardly the way system was set up to work. There are nearly 70 stories of soldiers who have committed suicide either in Iraq, Afghanistan or stateside since the inception of the War on Terror. There could be more since suicides are considered part of non-combat related casualties and such statistics remain sketchy. And in most of these cases, either the families of these soldiers had pleaded for help for their loved ones, fellow soldiers reported abnormal behaviors, or soldiers themselves confided in their superiors about their troubles. Unfortunately, too many never came forward at all, fearing stigmatization.

The military subscribes to the "watchful waiting" concept with respect to mental health problems. But when it concerns PTSD, symptoms often take 6 months to a year to manifest during which time a person may have already resorted to self-medication through illicit drugs or alcohol accompanied by violent or other self-destructive behaviors. Such presents more need for preventative assessments, not less.

For those troops who have requested face-to-face evaluations there are some areas of the country which have a waiting list up to a year and then there is often dispensing of anti-depressants, often by clinicians without any psychiatric training, without any accompanying counseling or therapy of follow-up. There is even a highly touted "telemental" therapy which troops can eventually utilize which is basically counseling by e-mail or instant messaging on the internet. It is hardly adequate for a person experiencing severe anxiety, night sweats, flashbacks, or bouts of paranoia.

A May 2006 Government Accountability Office (GAO) report found that four of five returning troops, potentially at risk for PTSD, were not referred for further mental health evaluation. Half of those eventually got help on their own but less than 10% were referred through the military. A September 2006 GAO report highlighted that the VA underestimated the cost of serving veterans upon return from Iraq and Afghanistan due to pre-war budget figures, yet still failed to report such problems to the Congress.

In December 2006 the GAO released an additional report which shows that the funds allocated to the VA for mental health have not been spent on mental health care accordingly. The report discloses that the VA has no system in place to track spending on mental healthcare and that funds may have gone to other resources instead. But such an indictment of the VA does not alleviate lawmakers of their oversight responsibilities, either.

Dr. Frances Murphy, Undersecretary for Health Policy Coordination at the VA said in March 2006 that there is a need for improvement for mental healthcare for an increasing number of veterans seeking help. She said, "VA clinics do not provide mental health or substance abuse care, or if they do, waiting lists render that care virtually inaccessible." "The VA needs more capacity so that vets can get treatment and don't have to wait," according to Paul Sullivan, a former senior analyst at the VA prior to April 2006 and now Director of Programs for Veterans for America, an advocacy organization.

Furthermore, while waiting to see a VA doctor, veterans with severe symptoms of PTSD are often denied disability benefits should they turn to illegal substances as a way to cope. They are then vulnerable to the categorization of "willful misconduct" since the military has a zero tolerance policy for drug abuse. And those who have received benefits are subject to losing them should they be found abusing drugs. Ironically, the VA is tolerant of alcohol abuse, just not illicit drugs. But even then, only if a medical doctor finds that the veteran also has been diagnosed with PTSD may they then continue to receive their disability benefits.

Veterans from the present and ongoing wars have been the best advocates for those presently active duty soldiers, reservists still on call and those now discharged. Such organizations and grassroot efforts have successfully lobbied lawmakers, attended and testified in hearings on Capitol Hill and in doing so have unearthed the inadequate access to mental healthcare for troops. And as typical of U.S. medical insurance plans, mental healthcare always takes a back seat to physical medicine. And it continues to remain the biggest hidden cost as the result of the War on Terror.

Yet through their plight for their brethren in uniform, former brothers in arms have proven that it is not always just a matter of throwing money at a situation to solve a crisis, as inadequate access to mental healthcare presents a crisis of its own. Certainly the invisible front line and a deceptive enemy have made for a war unlike any other that the U.S. military has previously fought.

Yet, much like prior wars fought by the U.S. armed forces, present and future veterans of the Wars in Iraq and Afghanistan will have not only fought for their health and survival on the battlefield but many must continue to fight to an ineffectual government for their continued survival. Certainly, it was to suppose to have been better by now, but sadly it is but another testament to benign neglect by those with the power to affect change.

Copyright ©2006 Diane M. Grassi
Contact: dgrassi@cox.net

For several years now, American healthcare consumers, including many from other western industrialized nations, have heard about elective surgeries being performed in lesser-developed nations and due to cost and denial of coverage by health insurance providers have opted to go there. However, surgeries in the past were truly elective and not medically necessary procedures that largely consisted of face-lifts, tummy tucks and gastric bypasses for cosmetic purposes.

But just in the past two years, American patients are being wooed to make decisions on serious medically necessary surgeries due to their fears of excessive healthcare costs. And the decision involves traveling abroad primarily to India and Thailand in order to receive such hospital care which they require.

For those self-insured, underinsured, or not insured at all, the desperation of receiving medical care without sacrificing homes or assets in the process is plausible, since costs of similar procedures in South Asia range from 75% - 80% less than in the United States. But now U.S. based corporations have entered the arena as well by encouraging employees to go to India and Thailand via cash incentives, free airfare and hotel stays with no co-pays due on the final bill.

Yet, just as with any large purchase consumers must look beyond the fancy advertisements and read the fine print with a Buyer Beware mentality. Americans have become quite adept at learning what to look for when dealing with car dealerships when purchasing an automobile and with computer retailers when purchasing a new computer. But it has taken many years to educate consumers as to their rights and protections under the law and what to do when something does go wrong.

The term "medical tourism" has been inaccurately applied to what is essentially the offshoring of patients of the U.S. healthcare system to foreign countries, in order to appeal to potential customers who are really medical patients. The term was invented by the media and it stuck and is now being used as a marketing tool. Deceptive in its concept, it is an implication that a patient can go sightseeing before or after a serious hospital procedure in that foreign country. But for those who are more scrupulous it remains difficult to get the necessary information needed to make a reasoned decision on whether to have surgery performed, let alone halfway around the world.

There are now organizations being touted as medical tourism agencies that have cropped up throughout the U.S. in order to facilitate such care overseas for individual patients as well as to serve as a clearinghouse for corporations wishing to outsource their employees' healthcare with them in tow. These groups include MedSolution, GlobalChoice Healthcare, IndUShealth, Planet Healthcare and Med Retreat, to name just a few.

And with more and more corporations adding select foreign hospitals as Preferred Providers to their employees' health insurance plans, medical tourism companies handle the paperwork and travel arrangements for their employees. Other countries of destination include Costa Rica, the Dominican Republic, the Philippines, Panama, Mexico, China, Malaysia, Singapore, Turkey and South Africa.

However, it is at this point that the patient needs to start their own due diligence. There is usually a requirement by most U.S. healthcare insurance providers for patients to get second opinions for most complicated surgeries in the U.S., but not so for offshore surgeries. And the list of surgeries which are being sent offshore are indeed medically necessary but confusingly being reported to the media as elective. But you can determine for yourself whether or not the following are elective procedures: cardiac bypass, cardiac stent implantation, cardiac angioplasty, knee replacement, hip replacement, mastectomy, hysterectomy, chemotherapy, eye surgery, vascular surgery, among others.

And as the medical tourism agency is only an intermediary between the client and the hospital as well as between hotels and airlines they do not provide any liability in the event that there is a medical complication or there is a mishap at the destination hospital. Furthermore, there are fees which could arise not documented by an employer nor agency which could require additional expenses upon the patient's arrival. And as a conduit between patient and hospital, the medical tourism business remains an unregulated industry in the U.S., without licensing requirements and with most managed by non-medical personnel.

Similarly, and unbeknownst to most U.S. patients is that the healthcare industry in India is highly unregulated. It was only in 2006 that regulations regarding the medical device industry, which includes surgical devices such as cardiac stents and orthopedic implants for use in hip and knee replacements, was mandated. Such call for regulation from the Drug Controller General of India (DCGI) only came about as the result of discovered defective drug eluting cardiac stents in 2004. And although hospitals have the option of applying for accreditation through the Joint International Commission established in 1999, a subsidiary of the Joint Commission on Accreditation of Healthcare Organizations, used for hospitals in the U.S., there is no such requirement to do so.

As of 2006 there are five hospitals in India which have JCI accreditation, renewable every three years. They include the three facilities of the Apollo Hospital group, the Shruff Eye Hospital and the Wockhardt Hospital. The Bumrungrad International in Bangkok is Thailand's sole JCI hospital. Singapore has over a dozen JCI hospitals however, and the Philippines has one. But the JCI accreditation only applies primarily to hospital management which although includes procedures to reduce risk of infection and disease and to ensure patient safety, it has no jurisdiction over the actual physicians performing surgical procedures.

The patient is provided limited information other than an introductory phone call to the intended physician and having medical records electronically sent to the doctor or hospital via the internet by the medical tourism agency. The patient has a choice of physicians, but unlike in the U.S. where there is easy access to a doctor's medical status by medical boards and organizations, other than knowing whether the doctor may have practiced medicine in the U.S., there is little information to come by. Without standardized protocols it is difficult for the patient to make a correct assessment.

When decisions on a patient's health is driven primarily by cost it can impair the decision making process. There is little argument that healthcare costs in the U.S. are bankrupting corporations and labor unions and deceleration of escalation is nary in sight. With the healthcare industry being 15% of the U.S. Gross Domestic Product and having risen in cost 75% for employers and 143% for employees since the year 2000, the system is broken. High malpractice insurance fees required by both employers and physicians, hospital deregulation and class action medical litigations have only exacerbated the problem.

Such high medical costs will only encourage limited access to healthcare for the middle class and ultimately result in less preventative care costing taxpayers more in the long run. The problem is not the medical care in the U.S., still considered the best in the world, but its delivery system. It is when Medicare and the health insurance providers became the decision makers and took that power away from the physicians that the system began to unravel. Added to that is the lack of restraint of costs by the pharmaceutical industry which charges U.S. patients more for its own medications than any other country in the world.

But as expensive as healthcare is in the U.S., there are legal and safety issues which are part of the American fabric which Americans very much take for granted yet expect but are not present in the undeveloped world. For example, there are few regulatory bodies such as the Centers for Disease Control, the Food and Drug Administration, the Federal Trade Commission, various medical boards, consumer protection laws, available legal experts and the court system. All serve as a net of safeguards offering remedies. But unlike a car purchase, medical care is a complicated undertaking in which there are no guarantees, yet there are areas of compliance which must be maintained.

Once the patient is in a foreign country there is little protection for redress and once that patient leaves the country should they need follow-up care such as therapy or if complications arise even during travel, they must seek medical care in the U.S. Secondarily, if the procedure is performed overseas, insurance providers or Medicare may not honor the additional required care in the U.S. Still, patients may decide to take the risks in addition to the inherent risks of any surgery, but should not be coerced into uninformed choices in order for their employer to save costs under the guise that they are helping to reduce the costs of U.S. healthcare in the long run.

In July 2006 the U.S. Senate Committee on Aging held a hearing called "The Globalization of Healthcare: Can Medical Tourism Reduce Healthcare Costs?" Its goal was to address the subject of medical tourism, its growth, safety of patients and possible regulation of the industry itself. Its Committee Chairman, Senator Gordon H. Smith, has asked that several federal agencies such as the Department of Health and Human Services, the Department of Commerce and the Department of State create an interagency task force necessary for lawmakers to reach informed decisions that healthcare consumers themselves cannot accurately make at this juncture regarding offshoring their medical care.

And among the labor unions, the United Steelworkers Union (USW) has publicly weighed in on this issue when it learned one of its union members, employed by Blue Ridge Paper Products, was going to be sent to India for gall bladder surgery simultaneously with shoulder surgery. Leo W. Gerard, USW International President, fired off a complaint dated September 11, 2006 to Congress by contacting the following committees: the House Committee on Education and the Workforce, the House Committee on Energy and Commerce, the House Committee on Ways and Means, the Senate Committee on Finance, and the Senate Committee on Health, Education, Labor and Pensions.

The goal is not necessarily to create more legislation but to establish guidelines. Perhaps Mr. Gerard puts it best when he states, "The right to safe, secure and dependable health care in one's own country should not be surrendered for any reason-certainly not to fatten the profit margins of corporate investors." He also contends to the Congress that "We remain steadfast in our commitment to rebuild a domestic healthcare system."
Let us hope that our government and healthcare providers can likewise make such a commitment by investing in the health and welfare of the American people.

Copyright ©2006 Diane M. Grassi
Contact: dgrassi@cox.net

In August 1981, 11,500 air traffic controllers who belonged to the Professional Air Traffic Controllers Organization, known as PATCO, were permanently fired by President Ronald Reagan, two days after their strike began, due to their violation of federal law. The president felt that the union did not seriously consider the 'no-strike' provision of their contract and had no other choice, in order to avoid a disastrous disruption in United States airspace. PATCO workers were then replaced with non-unionized employees. Further to the firing, President Reagan through an Executive Order in 1982, prevented any of the fired air traffic controllers from being rehired in the future by the Federal Aviation Agency (FAA), which oversees U.S. air traffic control. Over the next 3-4 year period new controllers were hired and trained in order to replace those fired, provided with supplementation by the U.S. military, in order to keep planes in the air. In 1993, also by Executive Order, President Bill Clinton rescinded Reagan's Order, allowing previously fired PATCO workers to be hired again by the FAA, which presently includes several hundred of the previously dismissed. Now, nearly 25 years later, the newly named air traffic controllers union, National Air Traffic Controllers Association (NATCA), is in prolonged contract negotiations once again with the FAA, which began July 13, 2005. The present contract, which expired in 2003 was extended until September 30, 2005, with salaries frozen and benefits continued until new terms were met. As of September 30, 2005, the contract has expired but continues under an "evergreen clause," allowing for the original contract to remain in effect as long as talks continue. Similarly to the negotiations which led to the 1981 strike are the issues of increased salaries and reduced working hours. But more differences than similarities exist in the present talks. Since the last agreement was negotiated in 1998, NATCA members are working longer hours and have more security responsibilities in the wake of September 11, 2001. In addition, after the initial tailing off of air travel at the end of 2001 and the beginning of 2002, there are now more flights in the air at any one time in the history of aviation travel, but with fewer controllers watching over more airplanes in the U.S., which has the world's busiest airspace. However, in the last two years, the FAA has lost 1,000 controllers. But at the crux of the problem is that many of the controllers today are those who were hired in the early 1980's and are set for retirement either immediately or in the near future. There is a federal mandate which requires all controllers to retire at age 56 whether or not there are employees to replace them. The FAA admits that 2,580 controllers are set to retire between 2005 and 2007 while only hiring an additional 13 in 2004. Additionally, there are not enough replacements in waiting in order to fill the quota. Instead of the originally promised 1,248 hires for Fiscal Year 2006, the FAA will now only hire 595 and phase in the remaining 654, by replacing one retiree at a time. With 9,000 of its 14,500 current number of air traffic controllers having been hired in the early 1980's, the FAA has dragged its heels on implementing a replenishment system known about for years. In a Government Accountability Office report issued in June 2002, it stated that "The FAA has not done enough to plan for the impending staffing crisis and needs to do so as soon as possible. It has not developed such a comprehensive workforce strategy to address all of the challenges it faces in responding to its impending need for thousands of new air traffic controllers, thus increasing the risk that the FAA will not have enough qualified controllers when necessary to meet air traffic demands." Sadly, the FAA took two more years to acknowledge their shortcomings regarding staffing needs, publishing a similar report of their own in 2004, but has recently promised to add 12,50