Ferguson Protests + Afghan Government in Trouble + Oil Price War

Obama holds a PR event today (Julie Hirschfeld Davis, "Obama Plans Meetings on Ferguson Unrest at the White House") the goal of which is to put a lid on the public outrage over the police killing last August of unarmed black teenager Michael Brown in the St. Louis suburb of Ferguson.

[Obama] will gather his cabinet on Monday to discuss the results of a review of federal programs that provide military-style equipment to state and local law enforcement agencies. The initiatives were called into question in August, after the Ferguson police responded with riot gear and assault-style weapons to protests in the aftermath of the shooting of Michael Brown, the teenager, by Officer Darren Wilson.

“As the country has witnessed, disintegration of trust between law enforcement agencies and the people they protect and serve can destabilize communities, undermine the legitimacy of the criminal justice system, undermine public safety, create resentment in local communities, and make the job of delivering police services less safe and more difficult,” a White House official said Sunday night, speaking on condition of anonymity to describe the meetings.

Don't count on any significant changes in the federal policy of offloading surplus military hardware to local constabularies.

The faux-macho, Fortune 500 thinking prevalent in our "Land of the Free/Home of the Brave" encapsulated in spouted lines like "Money talks; bullshit walks" is actually a helpful guide here. As long as the protesters stay mobilized in significant numbers the state will have to take special measures to fund the deployment of the highway patrol and national guard. According to Jack Healy and Monica Davey, "Darren Wilson, Officer in Ferguson Shooting, Resigns From Police Dept.":

The peaceful daytime demonstrations came as Gov. Jay Nixon of Missouri sent state lawmakers a letter outlining what he called an urgent need to cover the ballooning costs of maintaining hundreds of National Guard troops and state police officers who are deployed here on the streets, day and night. The governor has called a special legislative session.

One Ferguson resident interviewed last month prior to the grand jury decision thought some sort of indictment had to be forthcoming because a spike in protests that would follow an acquittal would bankrupt the community. Unfortunately, St. Louis County prosecuting attorney Robert McCulloch was not so prescient.

At this point I think the protests have legs. There was encouraging evidence of crossover between anti-racist and economic justice activists in the form of coordinated Black Friday protests.

Many significant shifts are currently underway. In Afghanistan the unconstitutional power-sharing agreement between Ashraf Ghani and Abdullah Abdullah is near collapse. A helpful summary of recent events is found in this morning's Foreign Policy Situation Report by David Francis and Sabine Muscat:

Kabul is the focus of Taliban insurgents seeking to undermine the fledgling government of new Afghan President Ashraf Ghani. The Afghan capital has been under siege in recent days with a dozen attacks in the last two weeks. Taliban spokesman Zabiullah Mujahid claimed the attacks were intended to scare foreigners out of the capital as well as to undermine Ghani. They follow the ratification of a bilateral security agreement between Kabul and Washington that will allow for 10,000 American troops to stay in the country in 2015. 

The Wall Street Journal's Nathan Hodge and Habib Khan Totakhil: "The past two weeks have seen a string of attacks on diplomatic and international targets in Kabul, including a deadly assault Saturday on a guest house belonging to a nongovernmental organization, Partnership in Academics and Development. This past Thursday a suicide attack hit Wazir Akbar Khan, the heart of the diplomatic quarter, and a car bombing struck a British diplomatic convoy." More here. 

The attacks, which targeted both Afghan officials and foreigners, have already forced the resignation of Kabul's Chief of Police Gen. Zahir Zahir. Ghani is scheduled to travel to London and Brussels this week to rally global support for his country. But political fallout in Kabul has already begun. 

Ghani has been unable to form a new government amid escalating violence and has dismissed most of the existing ministers in Afghanistan's government. The New York Times' Joseph Goldstein: "The underlying problem, which various factions in the government point to, is the power-sharing agreement that followed this year's disputed presidential election. It makes Mr. Ghani president and his election rival, Abdullah Abdullah, the chief executive. Since the deal was struck in September, Mr. Ghani and Mr. Abdullah have been unable to agree on a new cabinet, leaving the government in the lurch and raising questions about the long-term chances of the power-sharing deal." More here. 

Optimism had grown in recent weeks that Ghani and Abdullah would be able to find a way to work together. Their original agreement allowed the United States to finalize the bilateral security pact. Now, with the fate of Ghani's government uncertain, there are sure to be questions from Washington about whether the pact will hold.

My only quibble with the way Francis and Muscat frame the upswing in Taliban attacks is that they make it seem as if it directly followed Ghani's signing the bilateral security agreement as soon as he took office in September. I think the recent spate of attacks in Kabul come after reports in November that Ghani had lifted Karzai's ban on U.S.-led nighttime raids and airstrikes.

A developing story that has global ramifications not just for the power elite but for every single one of us who consume is the present oil-price war underway. OPEC met last week and decided against any production limits (Stanley Reed, "OPEC Holds Production Unchanged; Prices Fall"). This dropped the price of barrel of oil down around $70.

There is plenty of speculation as to why the Saudis, whose fiscal breakeven is reported to be around $90 a barrel, are opposed to production quotas and willing to let the price drop to $60 level. Some say it is to kill off the U.S. shale oil boom in Texas and North Dakota; some say it is to punish Iran and Russia. Whatever it is I think it is pretty safe to say the Saudis are practicing some form of predatory pricing; they want to maintain market share above all else because that is where their power comes from.

Naked Capitalism's Yves Smith has a helpful post this morning: "OPEC Fires First Shot In Global Oil Price War."

To get a sense of the type of new energy frontier we are in, check out last week's story by Diane Cardwell, "Solar and Wind Energy Start to Win on Price vs. Conventional Fuels":

According to a study by the investment banking firm Lazard, the cost of utility-scale solar energy is as low as 5.6 cents a kilowatt-hour, and wind is as low as 1.4 cents. In comparison, natural gas comes at 6.1 cents a kilowatt-hour on the low end and coal at 6.6 cents. Without subsidies, the firm’s analysis shows, solar costs about 7.2 cents a kilowatt-hour at the low end, with wind at 3.7 cents. 

“It is really quite notable, when compared to where we were just five years ago, to see the decline in the cost of these technologies,” said Jonathan Mir, a managing director at Lazard, which has been comparing the economics of power generation technologies since 2008. 

Mr. Mir noted there were hidden costs that needed to be taken into account for both renewable energy and fossil fuels. Solar and wind farms, for example, produce power intermittently — when the sun is shining or the wind is blowing — and that requires utilities to have power available on call from other sources that can respond to fluctuations in demand. Alternately, conventional power sources produce pollution, like carbon emissions, which face increasing restrictions and costs. 

But in a straight comparison of the costs of generating power, Mr. Mir said that the amount solar and wind developers needed to earn from each kilowatt-hour they sell from new projects was often “essentially competitive with what would otherwise be had from newly constructed conventional generation.”

The Saudis and the Koch brothers will do everything they can to maintain their fossil-fueled hegemony.And at this point it is becoming apparent that it is going to be a very destructive effort.