On a recent VPR radio commentary former Governor Jim Douglas laments the fate of Brian Dubie and worries over the future. Dubie, some may recall, is defending his 2010 gubernatorial campaign against alleged illicit coordination with the Republican Governors Association (RGA) on a campaign commercial. The complaint accuses the Dubie campaign of violating campaign regulations by sharing poll data and directly aiding in the production of an advertisement sponsored by the RGA. Douglas doesn’t say if, with his own years of experience, he personally reassured Dubie, but claims the RGA’s experienced, battle-hardened staff did.

The RGA lawyers had assured Brian that furnishing the information was perfectly legal; having been burned by Vermont’s campaign finance laws in the past, the Association had every reason not to run afoul of them, and Brian had every reason to rely on their advice.

He worries the cost of this ongoing legal tangle will have a chilling effect on those who want to run for office:

I've spoken with potential candidates who would have been great leaders, but are discouraged by the costs – both personally and of the campaign.

Maybe he didn’t have the time on radio or was just too modest to mention his significant role in the Dubie campaign events under question. When Douglas has these conversations with would-be candidates one has to hope he passes on details and some firsthand knowledge of the events he fails to make clear in his heartrending VPR piece.

Among other things he omitted was the problem his own 2004 campaign for governor had when the RGA ran afoul of Vermont’s campaign finance laws  with $300,000 worth of ads in his support. Douglas should by all means not be so shy – he should give himself credit for expertly narrating the RGA Dubie ad now under a legal shadow. And he could further enlighten us with the information from the 2010 Dubie case charging that Douglas acted as an agent of both the Republican Governors Association and Friends of Brian Dubie (the Dubie campaign organization). More recently, he along with other influential Republicans formed Friends of Brian Dubie Legal Defense Fund to pay Dubie’s legal costs. Jim Douglas might consider a follow-up VPR piece that mentions he was much more than bystander.

Lamentations? Yes, the implicated often cry when caught.  

 While taking time off from his duties presiding over the Vermont State Senate, Lt. Governor Phil Scott got a scare but thankfully was not harmed in an incident involving two alpacas. As part of Scott’s continuing Vermont Everyday Jobs Campaign Tour(an initiative to promote the Lt. Governor and showcase his relationship with the business community)the Lt. Governor spent the day making the rounds with Northern Vermont large-animal veterinarian Dr. Eda Fitchew.

While making a “house call” and photo op at the newly operational Vermont Alpaca Meats and Products Co. (VAMP) in the North East Kingdom, Scott and Dr. Fitchew were briefly pinned in a stall between an unusually aggressive older male and a young female alpaca. Luckily workers at the state-of-the-art farming operation acted quickly and pried open the stall gate which had jammed shut. The slightly shaken Lt. Governor and veterinarian made a hasty retreat from the stall away from the rowdy ungulates to safety.

After thanking the helpful farmhands and dusting himself off Lt. Governor Scott regained his composure and said “It was a really interesting experience,” and added “Each ‘Everyday Job’ generates information that I can bring back to Montpelier, and this visit showed me how much our state needs capable large-animal vets like Dr. Fitchew.”

Vermont Alpaca Meat Products Company (NYSE: VMPCO) opened just two years ago and is attempting to capture the growing market for alpaca specialty meats and associated products.

“In addition to our current slaughterhouse, The Olde Time Butcher Shoppe and snack bar the longterm goal is to capitalize on efficient functional use of the entire animal resource” says a VAMP Co. spokesperson. “To achieve that the former site of a miniature golf course/drive-in movie  will eventually house a tannery and high end retail clothing boutique featuring locally made Alpaca leather gloves, hats and handbags.”

With the aid of extensive state and local tax incentives and Federal EB-5 foreign investment status, VAMP Co. is growing rapidly, and has plans to “one day employ four or five seasonal part time workers” says the company spokesperson. Although still headquartered in Vermont, VAMP Co. also operates a newer but smaller Guanaco meat canning facility in South Carolina.

Vermont: Where your EB-5 funds are on the hoof and providing up-close-and-personal inspection opportunities for elected officials!

In Vermont we’re having an early spring and maybe the GOP is working on their own early fall. Even as Romney racks up the delegates he can’t quite dispatch his closest rivals. Chances are slim even less than slim according to pundits but there is talk, lots of talk of a brokered Republican Convention. When asked about this  Fox News' Sarah Palin said

“I wouldn’t be afraid of that” [perhaps seeing it more in terms of her own celebrity career she added] it was “continuation of a process… that would perhaps be very good,”

Onetime RNC chairman Governor Haley Barbour admits that the long undecided primary could “leave scars” but good ol’ Haley knows how to make a little lemonade:

“If it is a convention where we get there with nobody having the vote, [that is] not necessarily all bad.”

Beyond the jump:An energizing train wreck

The Hill.com found some insiders that think it would not be as Mike Huckabee fears “nothing less than a train wreck” but actually energize the party. Some of the speculation is coming from those unaligned with a specific candidate but opposed to Romney. The drama and intrigue of a brokered convention and accompanying battles would energize and mesmerize the broader public they claim. It certainly wouldn’t hurt TV news ratings either.

“Conventions are just hideously boring these days and have become more so, gradually, over the course of my lifetime,” Republican strategist Curt Anderson told The Hill.  A brokered convention, he added, “could make for an actual event that would interest people.”

Keith Appell also held out the possibility that a new candidate could come forward at the convention, presenting themselves as a ‘unity’ choice, capable of bringing together supporters of both Romney and Santorum. Names like New Jersey Gov. Chris Christie, Indiana Gov. Mitch Daniels and even Palin herself have been mentioned.

Romney has a good stock of delegates and will gather more this Tuesday but what Democrat isn’t energized at the thought of a brokered Republican convention? It has been a long time since the Republican’s last brokered convention in 1976. Back when Ronald the Reagan battled and lost the nomination to President Gerald “Whip Inflation Now” Ford. Some Republicans may remember President Ford went on to lead his energized party to defeat.  

Not much can be added to tag along with this chart that shows so dramatically who the winners and losers have been in the recovery to date. The chart is an analysis of recent IRS data by economists Emmanuel Saez and Thomas Piketty illustrates directions in US incomes after the Great Recession and the Great Depression. Pulitzer Prize winning journalist and tax code expert David Clay Johnson suggests this shows plenty about our tax and economic policy direction.

The 1934 economic rebound was widely shared, with strong income gains for the vast majority, the bottom 90 percent.In 2010, we saw the opposite as the vast majority lost ground.

National income gained overall in 2010, but all of the gains were among the top 10 percent.

Even within those 15.6 million households, the gains were extraordinarily concentrated among the super-rich, the top one percent of the top one percent.

Just 15,600 super-rich households pocketed an astonishing 37 percent of the entire national gain.

The different results in 1934 and 2010 show how a major shift in federal policy hurts the vast majority and benefits the super-rich.

Dick Cheney, one of the brave men who started the Iraq war and helped make the world safe for water-boarding has canceled a speaking engagement in Toronto Canada due to security fears. The April engagement was promoted by a company named Spectre Live Corp.

“He felt that in Canada the risk of violent protest was simply too high,” said Ryan Ruppert, president of promotions company Spectre Live Corp., which had booked Mr. Cheney for an April 24 appearance at the Metro Toronto Convention Centre.  

In September, Mr. Cheney was speaking at a private club in Vancouver when protesters massed outside the front door harassing ticket holders and in one instance, choking a security guard. The former vice-president was reportedly held inside the building for more than seven hours as Vancouver Police in riot gear dispersed the demonstrators.  

“God forbid there was ever an emergency,” said Ruppert, noting Cheney’s history of heart problems.

Cheney has said he has no regrets about his embrace of water-boarding and “harsh” interrogation techniques. And after leaving office he said "I would strongly support using it again if circumstances arose where we had a high-value detainee and that was the only way we could get him to talk."



However Lawrence Wilkerson, a former top aide to ex-Secretary of State Colin Powell, says

“He’s developed angst and almost a protective cover, and now he fears being tried as a war criminal.”

Bigtime.

It is well known that Vermont’s dairy farms are struggling. So an article titled “Even Dairy Farming Has a 1 Percent” caught my eye. Planet Money’s Adam Davidson’s short piece in the New York Times outlines familiar but nonetheless disturbing trends.

Davidson visited a dairy farm in New Jersey where a father-son team is barely staying ahead of the curve. The hard-working pair running this top-producing farm are on the job daily from 4:30 am to 7 pm and trade off Sundays – yet each earns less than minimum wage. All pretty familiar stuff to some Vermonters. Our state has seen some positive trends in value-added cheese processing and continues to focus on local fixes including expanding branding, aggressive marketing, and increasing Dairy Management Teams to reduce production costs.Major structural problems persist and dairy closures continue.

A modern dairy farm can produce large quantities of milk, but the task of balancing demand with supply is what haunts the industry. With accelerated consolidation and commoditization of the industry, a few big players are benefiting by trading dairy and feed products like fast-paced derivative traders.  Planet Money:

… dairy farming has its own 1 percent: that tiny sliver of massive farms, with thousands of cows, that make the biggest profits and are better equipped to pay agriculture-futures experts to help them manage risk.They continue to invest and grow.  

The markets offer a stunning range of complex agricultural financial products. Dairy farmers (or, for that matter, anybody) can buy and sell milk and animal-feed futures, which allow them to lock in favorable prices, hedge against bad news in the future and so forth. There’s also a new product that combines feed and milk futures into one financial package, allowing farmers to guarantee a minimum margin no matter what happens to commodity markets down the road.

This leaves many small operations on the margins and speeds consolidation. The U.S. Department of Agriculture reports that for the first time ever three percent of the dairies in the US now produce slightly more than half of the milk supply. Just over 50 percent of the milk supply came from farms with 1,000 cows or more. This shift happened quickly, since 2006 when 38.1 percent was produced by farms of this size. The biggest profits are clustered at the top one percent who control a large part of the industry.

And over the fence … ‘Problems loom’

“Problems loom for US dairy farms as output rises” says Agrimoney.com, an online industry publication. Dairy output is rising beyond sales capacity, as experts are pleading for industry self-control.

Producers needed to question whether extra output of some 600m pounds a month "can be readily sold at prices anywhere close to what is needed to generate milk prices high enough to cover costs of production" said Milk Producers’ Council John Kaczor.

Yet the Canadian dairy industry – using a completely different (and very un-American) model – seems relatively stable by comparison. In Canada a system of production quotas dating back more than 40 years protects farmers from conglomerates. The Canadian Dairy Commission and provincial marketing boards regulate prices paid to farmers and control the amount each can produce. It is a complicated system in which a farmer must purchase production quotas that determine the amount of milk that can be produced for sale. Typical Canadian dairy farms have about 70 cows (the average VT dairy farm has 130 cows); quotas (essentially one cow) can cost upwards of $20,000(Canadian). While this cost makes entering the daily business in Canada difficult and expensive, existing farms reportedly enjoy a stable business environment. A University of Illinois study of Canadian farmers’ perceptions of government dairy regulation found that farmers trusted the government system to protect their interests despite systemic inefficiencies.  

"Farmers may change their management practices because quotas are now the single largest capital investment, which restricts herd size,"said University of Illinois agricultural economist Lia Nogueira. "They don't have an incentive to export their milk because the price that they would get in the world market is much lower than the domestic market. It shows that government intervention and controlling an industry can change the way farmers do things. Once you establish a system and people are so invested in that system, it's going to be very hard to make any substantial changes even if it's clear that the program is inefficient."

What is true in Canada is also true in the US: once you establish a system and people are invested in it, it’s going to be very hard to change. Canadian farmers perceive the system benefits and protects them, but who benefits here in the US, and specifically, here in Vermont?  Our farms are vanishing, while some of our farmers barely earn minimum wage. Three percent of dairies produce half the milk. So we know the dairy one percent – massive farms and futures traders – making the biggest profits will resist change to a system that now benefits them and devastates small farms.

Finally, as near as I can determine a gallon of milk in Canada costs $2.41(US) and $3.30(US) in the States. Who benefits more?

 Ohio’s Samuel Wurzelbacher has won a tough Republican US Congressional primary. The conservative political newcomer is perhaps best known by his stage name “Joe the Plumber”. Although never a licensed plumber and not named “Joe”, Wurzelbacher will soon face 15 term Ohio Democratic Rep.Marcy Kaptur after barely winning his primary race.

 Despite outspending his opponent six to one, Wurzelbacher only narrowly won the Republican race with 51 percent of Toledo-area residents picking "Joe the Plumber" compared with the 48 percent who chose Steve Kraus, an auctioneer and real estate agent.  

Wurzelbacher not only had a massive monetary advantage but also scored the backing of big name Republicans, such as Herman Cain, and appeared at rallies with both Romney and Santorum.

 

Wurzelbacher’s main claim to fame came in 2008 when appearing as “Joe the Plumber” he famously asked then candidate Obama a confrontational question regarding taxes. This one performance sparked his rapid rise in Republican Party politics(always on the lookout for quality talent)and he made guest appearances in character as “Joe” with John McCain and Sarah Palin.  

 Update and correction after the jump: An interesting sidenote has come to our attention: one state lawmaker has a hefty financial stake in Green Mountain Coffee Roasters.

So Green Mountain Coffee Roasters needs a $250,000 VT tax break?

The Vermont House is considering changes in a tax detail that involves a high tech K-cup packaging machine and may yield Green Mountain Coffee Roasters an estimated tax break of $250,000 per year. Vermont News Bureau reports that under question, again is the tax on a portion of a high tech machine that performs “secondary” packaging.

Green Mountain hadn’t been paying tax on those machines until 2007, when tax auditors ruled the company ought to be paying tax on the portion of the machine related to stuffing K-cups into cartons. The company settled for $250,000.

Predictably GMCR is also debating whether it may or may not locate a future K-cup processing unit here in Vermont. Also by defining where manufacturing ends and packaging begins for tax purposes the issue might have implications for state revenue from future business taxes.

Administration officials say the bill “clarifies” an exemption designed to encourage companies like Green Mountain to locate their manufacturing operations in Vermont.  

“This is the type of production equipment we’re going to see more of in different industries,” Secretary of Commerce Lawrence Miller said last week. “And it’s those companies on the cutting edge that we want to attract.”  

At least one lawmaker, however, says the bill opens up yet another tax loophole, expanding by one the number of exemptions that now cost this state more than $1 billion annually in foregone revenue.  

Continued… They need a break?  

This tax break routine follows a well worn pattern of business leverage

GMCR’s director of taxes, Marge McDonnell says it’s a price tag [VT tax] that could compel the company to locate its new K-cup packaging operation somewhere other than Vermont.

It is a most gentle blackmail when Xyz widget corporation threatens not expand new activities here (or even bolt the state) if they don’t receive a gift …eh incentive. Any new loophole as with all the other loopholes will have to be made up elsewhere in Vermont’s budget. Sweeteners are for some and cuts are for others.

One international business publication notes that GMCR’s three-year compound annual growth rate is 74 percent. At the end of this years’ first quarter GMCR revenue was $1.15 billion, up more than 100 percent over the same period last year. They need a break?

Update: Vermont State Senator Hinda Miller, who is listed in a recent SEC insider transaction filing as “Director,” in February sold 25,000 shares of GMCR stock. She currently has 88,452 shares of Green Mountain Coffee Roasters, Inc. stock currently worth $1,651,410. Among her committee assignments are the Senate Committee on Economic Development, Housing and General Affairs and the Senate Committee on Finance.

Correction: Senator Miller sits on the Senate Committee on Health and Welfare and Senate Committee on Appropriations NOT on the committees listed above. I mistakenly referenced outdated information .(BP)

The question is: if this tax break issue in some form or another makes it to the Senate, will Senator Miller abstain from any vote on a Vermont State tax gift to a company in which she is a large stakeholder?  Stay tuned.  

Last week, as a result of a FOIA request the NRC made available online transcripts of agency conference calls made during the Fukushima meltdown disaster. Released without much media fanfare, these transcripts may have a pretty limited readership, but it really is fascinating first-hand stuff.

Regardless of your view of nuclear power, the first confused conversations made after the March 11, 2011 tsunami are a little unsettling. We should all be uneasy – not just because of the nuclear crisis unfolding in Japan, horrible enough, but because, as the NY Times suggests:

An undercurrent of the transcripts is how the United States would handle such an event.

Part of that dark undercurrent is the snail’s pace the NRC Fukushima Task Force’s recommendations are moving at. The earliest of Chairman Jaczko’s “fast-tracked” recommendations are still five years away from implementation. The remaining changes face many years of lengthy review and a generous helping of ‘stakeholder’ (industry) input before NRC final approval .  

The following excerpt is part of a call from Dan (Dan Dorman, Deputy Director for Engineering and Corporate Support) who is calling and wakes up Mr. Mamish (Nader L. Mamish, NRC Assistant for Operations). Included briefly is a Ms Doan (who may be Margaret Doan, Director, Office of International Programs.

The call took place early Saturday morning March 12, 2011.

DAN: So, have you gotten any sleep?

MR. MAMISH: I came home, ate and just crashed, had a couple of beers and crashed, right away. So, I just woke up.

DAN: You fit for duty?

MR. MAMISH: What?

Continued after the jump … “are you fit for duty”

DAN: Are you fit for duty? You're recorded live.

MR. MAMISH: Just a couple [beers], come on, Dan, give me a break.

DAN: All right.

MR. MAMISH: So, do we know anything about the rad level?

DAN: We have no specifics.

MR. MAMISH: Okay.

MS. DOANE: Hey, Dan. We were talking, TMI, maybe a refresher would be good for some of us.

DAN: Yes, okay.  

The second conference call is also from March 12.This, in part, is an exchange between NRC Chairman Jaczko and Dan Dorman (click here for the NRC transcript PDF).  

CHAIRMAN JACZKO: Okay.  

MR. DORMAN: Sir, a quick synopsis of the message that was sent from Mr. Condo to Mr. Poneman.  The issue is that Unit 1 at Daiichi, this is the unit that's similar to Oyster Creek, the isolation condenser plant.

CHAIRMAN JACZKO: Yes.  

MR. DORMAN: Based on the information in the email, it's evident that there is core damage at that facility, and that they are very recently in the process of venting the containment, and the — it makes mention of the wind direction, blowing to sea, that they are — do not have any at the plant, injection and cooling systems available, because of the loss of power. But they are using anything that they can find, in terms of fire trucks and perhaps, batteries from vehicles, to power pumps, to get water into the core.

‘Undercurrent’? More like an undertow.