Wall Street adds climate change to bottom line

from the February 27, 2007 edition - http://www.csmonitor.com/2007/0227/p01s02-usec.html

The environmentally tinged takeover of TXU Corp. illustrates global warming's increased financial relevance.

By Ron Scherer Staff writer of The Christian Science Monitor

NEW YORK

Wall Street now views the color green as something other than money.

In the latest sign that global climate change is becoming a major factor for investors, potentially the largest private takeover in the nation's history has environmentalists' fingerprints all over it.
A consortium of private investors announced Monday they would pay almost $45 billion to acquire TXU Corp., which generates electricity in the state of Texas. What makes the deal more than just another gigantic financial transaction is that the buyers of the company consulted with environmental groups and agreed to sharply scale back plans to build new coal-fired power plants.

"This is a real breakthrough, an indication investors are paying attention to the real financial risk associated with climate change," says Dan Bakal, director of electric power programs at Ceres, a Boston-based environmental group that advises investors controlling $3.7 trillion in assets. "It means Wall Street is really beginning to pay attention."

Wall Street analysts believe the deal could mean that future takeovers will start to factor in the cost of corporate carbon emissions.

This could affect mergers and acquisitions in a broad range of industries, including manufacturing companies, the auto industry, mining companies, and other utilities.

"What it shows is the environment has a much greater presence than in the past and the issue of global warming is under increased scrutiny," says Sam Stovall, chief investment strategist at Standard & Poor's in New York. "These are additional factors that must be addressed in future mergers."

In fact, there are some signs Wall Street is trying to get up to speed as quickly as possible. For the past three years, the World Resources Institute (WRI), an environmental think tank in Washington, D.C., has been working with investment banks and securities firms such as Merrill Lynch, Citigroup, and Goldman Sachs to teach them how to establish their own carbon "footprint" and analyze other companies' emissions.

Analysts eye carbon 'footprint'

By calculating the footprint – the amount of greenhouse gases a company pumps into the atmosphere – analysts can begin to forecast the potential risks of climate-change lawsuits and future costs of any greenhouse-gas regulations.

"It's been a slow start, but we have been pleased to see financial institutions begin to grapple with those systems," says Jennifer Layke, deputy director of climate and energy for WRI. "But this is the first time we have seen a set of investors reach out to the environmental community around the terms of a new investment deal."

Last year, the New York Stock Exchange began to educate CEOs about the issue. It sponsored a lunch with former Vice President Al Gore, who gave a slide-show version of his Oscar-winning documentary, "An Inconvenient Truth."

Investors call for carbon accounting

This year there will be a record number of shareholder resolutions asking companies about their carbon footprint.

Normally, shareholder propositions don't receive much traction in the corporate world.
But, the proposals have been receiving a significant amount of institutional support from such large shareholders as Calpers, the California public-employee pension fund. And there is increasing concern that corporate boards may have a liability if they don't start to plan for future limits on carbon emissions.

Pressure was already building on TXU to scale back its proposal to build 11 coal-fired power plants. Over the weekend, Ceres issued a report that looked at the potential carbon taxes the utility would face, assuming that Congress or the states begin to enact such charges.

"Our report made some reasonable assumptions, including that none of the costs would be grandfathered in," says Mr. Bakal. "That means 100 percent of the carbon dioxide must face a carbon tax, which we estimate could be as much as $780 million per year, perhaps for 15 years."
At the same time, the Ceres report called into question some of the revenue and cost assumptions that TXU had made to justify the new plants.

"We think they had overestimated the amount of growth and underestimated the amount of the coming carbon controls and the cost of complying with the existing Clean Air Act," says David Gardiner, one of the authors of the report and a sustainability consultant in Arlington, Va.

TXU buyers moved to ease opposition

Some of these issues resonated with the group of TXU buyers, which includes the Texas Pacific Group, Goldman Sachs, and Kohlberg Kravis Roberts & Co. Texas Pacific and KKR are private equity groups that amass money from pension funds and wealthy individuals and buy companies.

Monday, in Dallas, the buyers' group said they would drop eight of the 11 new coal-fired power plants if their deal succeeds. They also said they would roll back electricity rates by 10 percent. And, they indicated they would work towards meeting any national emissions caps in the future.
"It's a sign people are paying attention," says Rodney Taylor, managing director of the environmental-services group at Aon, a large Chicago-based insurance broker. "From a financial standpoint, it also says something about the perception of where energy costs are going. KKR is kind of a medium-term investor, so they must be looking at energy costs going up sharply over the next three to five years."

• Wire reports were used in this report.

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New search for global warming at poles

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p03s03-wogi.html

Earth's coldest regions are vital heat sinks and, eventually, hold the key to future rises in sea levels.

By Peter N. Spotts Staff writer of The Christian Science Monitor

For the next two years, the coldest places on Earth will become some of the hottest laboratories in the history of modern science.

This Thursday marks the official start of the International Polar Year (IPY), an unprecedented research assault on Antarctica and the Arctic.

Some 10,000 scientists from more than 60 countries launched the push because of significant changes they see taking place at these frozen ends of the Earth. Many hold that global warming is triggering these changes, including shrinking sea ice in the Arctic Ocean, thawing permafrost, and growing instability in Greenland's ice cap and in some floes coursing through Antarctica's ice cap.

The US kicks off its part of the $1.5-billion project with opening ceremonies Tuesday in Washington.

The goal is to gain a deeper understanding of processes affecting everything from the flow of glaciers, and key features of polar climate to plankton and polar bears. In addition, researchers plan to leave a legacy of networked, standard sensors and buoys that will help track changes in these crucial regions long after the IPY ends.

Why North and South poles matter

At first glance, the poles may seem too remote to matter to anyone who doesn't live there. But Earth's "cryosphere" – its high-latitude regions of snow and ice – represents a central piece of the climate system. The poles act as sinks for the heat generated in the tropics and carried toward higher latitudes by the oceans and atmosphere. Over many centuries, the ice caps on Greenland and Antarctica hold the key to future sea-level rise as the climate warms up north.

Thus, the hidden hand of a changing Arctic reaches farther south than icebergs alone suggest.
"There is no magic curtain that drops down at 60 degrees north," says ice scientist Jacqueline Richter-Menge, who heads climate-related research at the US Army Corps of Engineers' Cold Regions Research and Engineering Laboratory in Hanover, N.H.

Changes in ecosystems

For instance, ecosystems stretching from the Labrador Sea to the continental shelf off North Carolina are changing because colder, less-salty water is flowing along the continental shelf from the Arctic Ocean into the northwest Atlantic, according to two Cornell University scientists. Many researchers attribute the Arctic Ocean's freshening to global warming.

The scientists note that while overfishing triggered the collapse of lucrative cod fishing off the Canadian Maritime Provinces, this fresher, colder water along the shelf has hindered the cod's recovery there compared with stocks farther south.

In their place, marine life, including shrimp and snow crab, that cod would have eaten are flourishing. The changes in water conditions have altered the timing for peak production among tiny plankton that nourish creatures higher up the food chain.

"These timing changes are going to lead to changes in the ecosystem. There will be winners and losers in the ecosystem. And there will be winners and losers in society," says Charles Greene, a Cornell oceanographer who was a co-author of the report.

Meanwhile, in the south, scientists working on the global Census of Marine Life say they see biologically significant shifts in marine life along the sea floor that once anchored two large ice shelves known as Larson A and B. They broke away from the Antarctic Peninsula over the past 12 years.

"The more we understand what's going on, the more winners there will be," Dr. Greene says.

International grass-roots effort

The IPY coincides with the 50th anniversary of the International Geophysical Year (IGY), the first postwar effort to study the entire planet, from the deep-sea floor and below to the outermost reaches of the atmosphere. Although this year's effort is dubbed the polar year, it spans two years to allow scientists to track conditions at both poles through a complete summer-winter-summer cycle.

The IPY includes more biology and ecology to better gauge the effect changes are having on plants and animals, as well as on the organic carbon stored in frozen tundra. Scientists say that as the Arctic in particular warms, they expect this carbon to reach the atmosphere as carbon dioxide and methane – turning the Great White North into a source of heat-trapping greenhouse gases.

Unlike the IGY, "this is a very grass-roots effort," says Robin Bell, a senior scientist at the Lamont-Doherty Earth Observatory in Palisades, N.Y.

Last week, Dr. Bell and colleagues described how lakes in the right location beneath Antarctic ice "rivers" accelerate the ice's movement toward the sea.

The poles "are the parts of the planet changing most rapidly" with global warming, she says.
Understanding them is key to understanding how the rest of the planet is likely to respond.

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Bye-bye, incandescent bulb?

from the February 28, 2007 edition - http://www.csmonitor.com/2007/0228/p01s03-ussc.html

Global warming concerns are pushing bulbmakers and environmentalists to talk about phasing out the common light bulb.

By Mark Clayton Staff writer of The Christian Science Monitor

Is Thomas Edison's most famous invention, the incandescent light bulb, about to fizzle into obscurity?

Thanks to global warming, the ban-the-bulb movement is gaining strength. Australian officials and European lighting manufacturers have announced phaseouts of the energy-draining bulb. A California legislator has proposed a ban. Now, in a move that could speed the move away from the 128-year-old invention, some of the world's largest bulbmakers have joined environmental groups and the California Energy Commission in talks that could lead to a phaseout in the US within a decade, sources say.

The scope of the move – and manufacturers' support of it – is still undecided, they add. "We're talking about a 10-year phaseout of incandescents, but there's no plan on paper on how to do that yet," says a source close to the talks who, lacking authorization to speak to media, asked not to be identified. "We're thinking through and seeking answers to a number of questions," said the source, noting the talks could yet fail.

The negotiations – which could yield a phaseout of incandescents for the huge California market, or perhaps affect the product line in most of the nation – are taking place amid evidence of a rising anti-incandescent clamor.

• On Monday in Paris, the European Lamp Companies Federation, a trade group of lighting manufacturers in the European Union, unveiled a pact to phase out incandescent bulbs, without specifying a deadline.

• Last week, Australians officials announced a phaseout of incandescents bulbs by 2009.
• In California, state lawmaker Lloyd Levine in January introduced a bill that would ban the sale of incandescent bulbs statewide by 2012.

"We are definitely seeing a trend with some leaders in the lighting industry proposing a ... shift away from incandescent to higher-efficiency technologies," says William Prindle of the American Council for an Energy-Efficient Economy.

If the move to dim the ubiquitous incandescent bulb is sweeping enough, it could represent a coup for efforts to curb climate change via greater energy efficiency, he and other experts say.

"Lighting is ... one of the areas where we can achieve significant energy gains," says Claudia Chandler of the California Energy Commission. "We expect incandescent to yield to other technologies as energy-efficiency standards get tougher."

The incandescent bulb is an energy hog. Just 5 percent of the electricity it uses goes to light the bulb; the other 95 percent is heat. Improving light output and lowering heat output would reduce demand for electricity from coal-fired power plants, which emit carbon dioxide. CO2, most climate scientists say, is the single largest contributor to global warming.

Incandescent bulbs are burning in most of the 3 billion to 4 billion screw-in sockets in US homes and businesses – swallowing about 10 percent of all US electricity use, the US Department of Energy reports. Retail giant Wal-Mart has said it wants to sell 100 million compact fluorescent bulbs (CFLs) by 2008.

If all homes and businesses used bulbs that are 35 to 75 percent more efficient – such as CFLs and advanced halogen lamps – they would collectively save almost $10 billion a year in energy bills. The switch would also cut energy demand enough to eliminate the need to build dozens of coal-fired power plants, says the Natural Resources Defense Council, an environmental group. That would prevent tens of millions of tons of carbon-dioxide emissions every year for decades, and would help stabilize the climate, says NRDC.

"We should no longer be selling the least-efficient light bulb," says Noah Horowitz, a NRDC senior scientist. "We have the technology today."

But the venerable incandescent may have life in it yet. General Electric Co. said Friday that by 2010 it would make an incandescent bulb twice as efficient as today's – and by 2012 produce one that is four times more efficient, on par with CFLs.

"Banning any specific technology is absolutely unnecessary," says Kim Freeman, a spokeswoman for GE's Consumer & Industrial division in Louisville, Ky., which includes lighting. "GE supports national policy that will drive improved energy standards for all lighting products, regardless of the technologies."

All incandescent-bulb makers reportedly remain wary of proposed bans, as well as of any marketing misstep that might alienate customers. Like NRDC's Mr. Horowitz, GE officials say they want tougher performance standards for all technologies – not a ban on one technology.

Among three large lighting manufacturers said to be involved in the talks, Philips Electronics North America Corp. is the most enthusiastic, says a source near the phaseout discussions. Osram Sylvania, in Danvers, Mass., seems to be warming to the idea. It's not clear if General Electric, America's largest lighting manufacturer, likes or dislikes the idea, the source says.

All three firms declined to comment on any phase-out discussions. But some say they favor, in principle, a worldwide shift from incandescent bulbs. "We at Philips do support the idea of phasing out incandescent lights over a reasonable period of time, roughly 10 years around the globe," says Randall Moorhead, a vice president for Philips Electronics, the US subsidiary of Royal Philips Electronics in Amsterdam.

Any move in California toward tougher energy standards for lighting are expected to raise the bar for federal lighting-efficiency standards now under review.

A potential drawback is that CFLs contain mercury – about 5 milligrams per bulb, says GE. Incandescents don't. In recognition that CFL disposal could pose a problem, major manufacturers are promoting bulb-recycling programs and plan to cut bulbs' mercury content.

Even so, California Energy Commission studies show that a shift to CFLs would yield a net decrease in mercury, because fewer power plants would mean less mercury would be emitted from plants, Ms. Chandler says.

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'Green' governors, a warmer lake, and Al

from the March 01, 2007 edition - http://www.csmonitor.com/2007/0301/p04s01-wogi.html

This week's climate change media update notes states' efforts, Lake Superior's temperature, and the green hue of this year's Oscars.

By Brad Knickerbocker Staff writer of The Christian Science Monitor

States, increasingly seen as America's laboratories for seeking and testing policies for curbing greenhouse gases, continued to forge ahead with efforts to police carbon emissions. But they also seem to be aware that the power of one has limits, and maybe even competitive disadvantages. Voilá! A regional agreement.

Such an approach to global warming is needed because the federal government has failed to take a tough approach, said five Western governors Monday, who took first steps to tackle the issue regionally, the Financial Times reported.

Republican Arnold Schwarzenegger of California and Democrats Bill Richardson of New Mexico, Theodore Kulongoski of Oregon, Christine Gregoire of Washington, and Janet Napolitano of Arizona unveiled a plan to set regional standards for carbon-dioxide emissions, track and manage greenhouse gases, and operate a cap-and-trade emissions system for businesses, The Washington Post wrote. Their effort follows an agreement by seven Northeastern and mid-Atlantic states in 2005 to limit greenhouse gases from utility plants.

"In the absence of meaningful federal action, it is up to the states to take action to address climate change and reduce greenhouse-gas emissions in this country," said Governor Napolitano, chair of the National Governors Association in a press release. "Western states are being particularly hard-hit by the effects of climate change."

One answer, NASA climatologist James Hansen told journalists Monday, is no more coal-fired power plants.

"There should be a moratorium on building any more coal-fired power plants until the technology to capture and sequester the [carbon-dioxide emissions] is available. This is a hard proposition that no politician is willing to stand up and say it's necessary."

The waters of Lake Superior are warming up earlier in the year, says Jay Austin, a researcher with the University of Minnesota-Duluth's Large Lakes Observatory. Water temperatures are rising almost twice as fast as air temperatures. As a result, spring turnover, when warmer water layers on top of colder water, has moved up from early July to mid-June, which could affect plants and fish, the Associated Press said.

Even small blips in temperature can put organisms on the move, the Los Angeles Times reported Sunday. "Incremental temperature changes have begun to redraw the distribution of bacteria, insects, and plants, exposing new populations to diseases that they have never seen before," the paper reported.

For example, in Sweden "fewer winter days below 10 degrees F and more summer days above 50 degrees F have encouraged the northward movement of ticks, which has coincided with an increase in cases of tick-borne encephalitis since the 1980s." In Africa, mosquitoes have been moving up mountainsides, bringing malaria to villages never exposed before.

Dr. Paul Epstein, associate director of the Center for Health and the Global Environment at Harvard University, told the Times:

"No one's saying global warming is the whole picture here. But it is playing a role. As climate changes, it's projected to play an even greater role."

In a report this week, the United Nations Foundation and the Sigma Xi Scientific Research Society warned that exceeding global average temperature increases of 2 to 2.5 degrees Celsius above the 1750 preindustrial level would sharply increase the risk of intolerable impacts.

Avoiding the "tipping point," say the 18 scientists from 11 countries who spent two years writing the report, requires that global CO2 emissions peak no later than 2015 to 2020 at not much above their current level and decline by 2100 to about a third of that value.

In British Columbia, some experts believe the Canadian province could be energy self-sufficient by 2025 from renewable sources alone. The GLOBE Foundation in Vancouver reported Tuesday that this would provide a secure long-term energy supply, as well as some insulation from world energy shocks. The province already obtains about 40 percent of its energy from renewable sources.

This year's Academy Awards had a decidedly green hue. Many of Hollywood's glitterati arrived in hybrid Priuses. There they saw "An Inconvenient Truth," the film about Al Gore's anti warming campaign win the award for best documentary.

"It's not a political issue; it's a moral issue," said the former vice president in accepting the award. "We have everything we need to get started, with the possible exception of the will to act. That's a renewable resource. Let's renew it."

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Mysterious alga threatens rivers

from the March 01, 2007 edition - http://www.csmonitor.com/2007/0301/p13s01-sten.html

'Didymo' is perplexing scientists as invasive, ruglike blooms of the stuff snarl waterways in both hemispheres.

By Moises Velasquez-Manoff Correspondent of The Christian Science Monitor

In the late 1980s, a freshwater alga began mysteriously blooming in the rivers of Vancouver, British Columbia, covering once-pristine riverbeds with a thick, woolly mat. Dubbed "rock snot" for its yellowish color and globular form, the sudden dominance by a previously benign alga presented something of a puzzle. Thought of as native to the area – and to many rivers and streams throughout the northern hemisphere – this particular alga was acting as if it had just been introduced.

"This is the mystery," says Max Bothwell, a research scientist with Environment Canada who studied the Vancouver blooms. "How could an endemic species invade?"

Scientists, who often refer to Vancouver's experience as the "epicenter" of an ongoing global epidemic, are still not quite sure. Known as didymosphenia geminata, or "didymo" for short, the alga (algae is the plural form) has since bloomed in the Ozarks, the Rockies, Iceland, and Eastern Europe. And its worldwide spread seems to be accelerating. In 2002, didymo appeared in South Dakota, causing a near collapse of the Rapid Creek brown trout fishery. In 2004, it jumped hemispheres, covering New Zealand's famously scenic rivers with mats the likes of which scientists had seen nowhere else. And just last year, the alga appeared in Quebec's Matapedia River, an important East Coast salmon fishery.

Scientists warn that the blooms could spread throughout cold rivers in both hemispheres if not kept in check. Utility companies eye didymo nervously as a costly fouler of intake grates. Anglers and ecologists worry about its potential effects on a river's food web. Its major effect so far seems to be aesthetic – the algal mats are often compared to shag carpeting or fiberglass insulation. But the larger question keeps scientists musing: What could have led to such rampant blooms? In today's well-traveled world, suspicion fell squarely on humans. But inadvertent dispersal by globe-trotting citizens doesn't totally account for its rapid spread. And how could it "invade" places where it already lives? These contradictions have led some to suggest an evolutionary event: an innocuous alga mutating into a superstrain.

Hard proof is lacking, "but it's the only guess that's consistent with all the observations we have," Mr. Bothwell says.

Didymo is paradoxical. It is the largest diatom, a family of single-celled algae defined by a silica encasement. It favors cold, clear water flowing over a relatively hard bottom. Unlike other algal species prone to blooming, didymo favors nutrient-poor waters. And while algal matter often forms the base of any food chain, didymo's stalk – the bulk of a "rock snot" bloom – is curiously immune to grazers. It is often found wrapped around river foliage a year after dying – dried, bleached, and undecomposed. (Those unacquainted with didymo mistake it for toilet paper, and assume didymo-choked streams are open sewers.)

"The nature of the stalk – that hasn't changed," says Sarah Spaulding, an ecologist with the US Geological Survey in Denver. "Something about the production of the stalk has."

This speaks to one of the most frustrating – or fascinating, depending on whom you ask – aspects of didymo: It continues to surprise. After concluding it lived only in cold, nutrient-poor streams, for example, scientists found it in the warmer rivers of the eastern United States and the phosphorus-rich rivers of Eastern Europe.

The hypothesis of a newly virulent strain already faces considerable hurdles. History describes didymo blooms in the Faroe Islands north of Scotland dating back nearly 200 years. Norway has experienced occasional blooms for at least 100 years, as has northwestern China.

The jury is still out on didymo's long-term effects on river ecology, but some think that they may be considerable.

"It's gobs of carbon, and that stuff has to go someplace," says Craig Cary, a professor of biotechnology at the University of Waikato in New Zealand. "You can't just load a system with that much carbon without its being degraded."

While it apparently had no effect on Vancouver's steelhead trout population, its arrival in Rapid Creek, S.D., coincided with the near-collapse of the brown trout fishery. A possible explanation: Scientists note that didymo mats led to a shift in the size and diversity of larvae species. In the case of Rapid Creek, maybe the less-nutritious food starved the trout.

But it wasn't until didymo invaded New Zealand in 2004 that there was a big break in the case. Unlike Vancouver, where the species was native, rock snot was foreign to New Zealand. Its arrival strongly hinted at a human culprit. Was that true of Vancouver?

After poring over fish and game data, Bothwell found a possible link: The number of fishermen visiting Vancouver Island had increased tenfold in the early 1980s, says Bothwell. Anglers were now hopping on planes to visit faraway, world-class fishing sites. Also in the mid-1980s, felt-soled waders – which provide a superior grip on rocky river bottoms – came into widespread use. The felt stays wet long after use and could easily harbor freshwater organisms.

Armed with this information, the Kiwis launched an aggressive didymo-awareness campaign, urging anglers and water enthusiasts to disinfect their gear. Their efforts seem to have paid off: Didymo has yet to arrive on New Zealand's North Island.

Nature, meanwhile, has hinted at its own way to control the diatom. The Vancouver blooms subsided on their own, leading Bothwell to guess that a virus or bacterium brought the alga back in line.

Algae precautions in NZ

After extensive testing, scientists in New Zealand have deemed an algaecide, copper chelate, as most effective at curbing didymo growths. Eradication isn't the hope, says Christina Vieglais, head of the country's Didymo Science Program, but pushing didymo into the background is. "The impacts of this organism are corresponding to the amount of biomass it produces," she says. "If we can reduce the biomass, we'll reduce the impact."

In the meantime, seeking to prevent infestation of its North Island, New Zealand has launched an aggressive didymo-awareness campaign. Summarized as "check, clean, dry," here are its recommendations for outdoor enthusiasts:

Check: Before leaving a waterway, check items for clumps of algae. Do not take debris found at the waterway.

Clean: Clean all items for at least one minute with one of the following:

• Hot water (60° C; 140° F).

• A 2 percent solution of bleach (200 ml. or 7 oz. of bleach, added to water to make 10 liters or 2.6 gallons).

• A 5 percent solution of salt, dishwashing liquid, or antiseptic hand cleaner, (500 ml. or 2 cups of product, with water added to make 10 liters).

Dry: If cleaning is not practical, make sure the item is dry to the touch, and then dry for an additional 48 hours.

For more information, visit: www.biosecurity.govt.nz/didymo

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High price of paradise in Florida Keys

from the February 23, 2007 edition - http://www.csmonitor.com/2007/0223/p03s03-usec.html

High property costs and a series of hurricanes contributed to a 4 percent population decline.

By Amy Green Correspondent of The Christian Science Monitor

ORLANDO, FLA.

Robin Boyle arrived in the Florida Keys two years ago, enthused about her new job and new life in paradise. Now she's moving to Michigan.

She imagined that she and her husband, who lived in Key West in the 1960s, would enjoy a slower pace before retirement. But the couple couldn't afford anything more than a trailer or apartment. When her husband's medical emergency required a two-hour helicopter ride to a Miami Beach hospital, she knew it was time to go.

"We thought we would love it," says Ms. Boyle, who is giving up her job as managing editor of the Marathon/Big Pine Free Press in Marathon, Fla., for the same job at a newspaper in Hillsdale, Mich. "We just can't afford to live here, but that is happening everywhere. Even doctors can't afford to live here. The whole middle class is leaving," she says in a phone interview.

In a state where growth is booming, the Florida Keys are losing residents. Monroe County, which comprises the Florida Keys, lost population every year between 2000 and 2005, dwindling by 4 percent to 76,329 residents, according to the US Census Bureau.

By contrast, up near Jacksonville, Flagler County was the nation's fastest-growing county during the same period, its population surging by 53 percent to 76,410 residents. Across the state, the increase has driven up land values and lured new businesses.

But in this tropical paradise, the traffic is thinner than in the rest of the state, and at least one elementary school in Key West is expected to close. The islands are also short of workers vital to the economy, including nurses and police officers, says Sonny McCoy, the county mayor, in a phone interview.

What's behind the population drop?

It's not that the carefree flip-flop and bicycle lifestyle of the Keys has lost its appeal, says Robbie Hopcraft, who owns a mortgage brokerage firm and has lived in Key West for 14 years. It's that it's too expensive for most Americans, he says.

The population decline in the Keys is the result in part of geography and growth management. A string of islands offers only so much land to build on. And to curb environmental damage and overcommercialism, and protect residents from hurricane property damage, the state and local governments have imposed strict building codes that have driven up the price of housing. But more worrisome to many residents is an upswing in hurricane activity that battered Florida in 2004 and 2005. Property insurance rates have skyrocketed since then, prompting many to pack up and leave.

The issues the Keys face could hint at what's to come in other coastal areas grappling with hurricanes and escalating property insurance costs, says Maureen Ogle, historian and author of "Key West: History of an Island of Dreams." She points to the 1920s, when the economy in the Keys was dragging long before the 1929 stock-market crash.

"What you see in Key West is a very compressed kind of microcosm of problems that unfold over a longer period of time on a bigger scale on the mainland," she says. "When the price of insurance goes up, it's going to affect a place like Key West a lot faster and harder" because its economy is so dependent on tourism. The Keys draw 3.6 million tourists and generate $2.2 billion a year, according to the Monroe County Tourist Development Council.

Costs of property insurance

Mr. Hopcraft describes the high property insurance in the Keys as a crisis. His policy on his two-bedroom, 800-square-foot home has climbed to $8,000 a year. A year ago, he joined with other residents to establish a grass-roots lobby organization, Fair Insurance Rates in Monroe or FIRM.

"Most of the people here are working people. They have dive shops and charter fishing boats and lobster fishing boats, or they own their own restaurant or business," he says in a phone interview. "A lot of them are struggling."

Residents may soon receive some help. A new state law, which takes effect Jun. 1, is designed to reduce rates by putting more of the risk on the state and making more state backup insurance available to private insurers.

Home prices begin at $500,000

Yet many who work in the Keys can't afford to live there. In a county where home prices begin at $500,000, developers are replacing trailer parks and locally owned motels with high-end condos and hotels. Bob Dean, who owns a funeral-service company and has lived in the Keys for 55 years, subsidizes rents for four of his 19 employees in Key West, where rents range from $1,200 to $2,000 a month. Many other workers across the Keys are bused several hours a day from Miami.

To create more nearby affordable housing options, Monroe County leaders plan to offer county-sponsored housing for teachers, police officers, firefighters, and other workers, says Mr. McCoy.
McCoy, who was born and raised in the Keys, describes the population decline as a natural transition. "We're not too interested in a large population to begin with," he says. "It's a unique area, and that's what makes it so attractive and what makes it so important that all those restrictions are there.... We don't want to overcommercialize the islands because they're beautiful, and we want to preserve them for generations to come."

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A souvenir that became the symbol of so much more

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p18s03-hfes.html

In Ecuador, a puma mask reveals much about the culture – and the American who bought it.

By Leigh Ann Henion

I noticed the puma on my first day in town. The cartoonish, carved wooden mask hung just inside the open door of a store next to the hotel where I was staying during my time in Cuenca, Ecuador.

I do not collect many things, but masks are of great interest to me because of the way different cultures use wood, stone, glass, and ceramic works of art to cover their faces, shrouding their identities while revealing something deeper about themselves or their story.

I thought about the yellow and orange mask as I went about exploring the town – visiting the fragrant open-air flower markets, the bakery with sweet bread overflowing wicker baskets, and the Tomebamba River that flows through the town's center.

I was going to be in Cuenca for a month, taking conversational Spanish lessons, and I certainly didn't want to start buying souvenirs right away. But at the end of the day, when I turned onto the cobblestone street leading to my hotel and the store with the puma mask, I knew I had to buy it.

Little did I know that my fascination with this mask would lead to countless hours of conversation, teaching me more than my Spanish instructors ever could.

When I arrived at the store, it was crowded with fellow students who had just gotten out of their Spanish immersion classes, which were held throughout the day just a few blocks away. I loitered around the doorway until the store's owner noticed how intently I was staring at the mask hanging on the plaster wall, much too high for me to reach.

The shopkeeper had long dark hair pulled back into a ponytail, and he was wearing an alpaca vest that I recognized as Bolivian. He was only a few years older than I, but he was nearly a foot taller, so he had no trouble reaching the mask. When he handed it to me I couldn't help but inquire about the significance of the animal, the meaning behind the mask.

Juggling payments for alpaca purses and handmade jewelry, Diego, the shop owner pulled a dozen illustrated books out from under his sales counter.

He could not speak a word of English, and I was getting by on Spanish so limited that the night before I'd been amazed when I came across a Scooby-Doo TV show dubbed in Spanish. I'd been floored by the realization that even Scrappy-Doo could speak better Spanish than I could!

The word "puma" is the same in English and Spanish, and somehow Diego and I had a conversation about the animal and its symbolism. We talked until the crowds had filtered through. We talked around words we didn't know and in circles until I understood that the puma represented the ability to move through the world with grace. Also that, in many South American cultures, the puma is a sacred mountain animal that has an unfailing focus on what it wants from life.

We talked until it was time to close the store. "Come back tomorrow," Diego said in Spanish. "I have something to show you."

The next day, i discovered that what Diego had to show me was a collection of pan flutes, or panpipes, traditional Andean instruments that sound like ethereal versions of what they actually are, organic reeds that are given life by human breath.

The music Diego made on the panpipes was beautiful. When he stopped playing, I begged for one more song, and then we talked for hours. This became our daily ritual.

In time, Diego invited me to hear his band play. They were a group of young musicians carrying on their families' traditions with regional songs such as "Lake Titicaca," a haunting tune that makes a listener think of the echoing wings of a flock of birds taking flight over open water.

Listening to Diego and his friends play their timeless music in his living room became one of my favorite things to do in Cuenca, whose full name is Santa Ana de los Cuatro Rios de Cuenca. So, naturally that's what I wanted to do on my last night there. It had only been four weeks since I met my new amigo, but already it was time to leave.

Walking me back to my hotel on my last night in Cuenca, Diego handed me a book of Andean folklore and told me it was meant as airport reading. It was a thick academic book written completely in Spanish, and it didn't have any of the glossy images like the ones he'd shown me during our first meeting. I hesitated for a moment, intimidated by the immense tome of knowledge being offered in a language I had not yet mastered, but I reluctantly accepted.

Diego laughed at my expression, which must have been a look of intermingled gratitude and fear. "Don't worry," he told me, "you will finish it. You might not finish it in the airport, but you'll be able to read this book. You are like your puma. I've seen it in you. You're determined."

I've had that book for more than five years now, and I still can't read all of it. I also have a stack of letters from Diego. They bear his careful script and my sloppy translations, written with the help of my trusty Spanish-English dictionary.

I am still a language-challenged traveler who can't speak as well as a dubbed-in-Spanish Scrappy-Doo. I stumble over words and, confused, take the wrong bus from time to time when traveling through parts of the Americas where romance language lives.

But I am like a puma in search of my graceful, Spanish-speaking self. I'm still not giving up. That should be obvious from the look on "my" face, the wooden one that now proudly hangs on my living room wall.

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With full-body X-ray, a closer look at air travelers

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p02s02-ussc.html

Most asked to undergo a scan as part of a pilot program agreed to do so, but privacy concerns abound.

By Faye Bowers Correspondent of The Christian Science Monitor

PHOENIX

Most passengers asked to submit to a full-body X-ray at Security Checkpoint B didn't bat an eyelash. Nine in 10 gamely stepped up to a scanner about the size of a vending machine, placed their feet on the red footprints painted on the carpet, and raised their arms – all in the name of airport security.

The aim of the new technology unveiled Friday at Phoenix Sky Harbor International Airport: to allow officials to detect weapons – such as plastic explosives strapped to the body – that metal detectors and other security measures might miss.

A potential sticking point is that this machine, known as a backscatter, can see through clothes. Its deployment at the Phoenix airport is a test to see how well it works – and to assess how air travelers respond to its use. If passengers at Terminal 4 who were asked to undergo body scans are an indication, security trumps privacy.

"Sure, I'd be happy to do it," said Ella Adams from Atlanta, who had stopped in Phoenix on Friday to catch a connecting flight to San Diego. "Privacy to me isn't nearly as important as our security, especially if they assure me the X-rays aren't harmful."

In all, the Phoenix airport has seven security checkpoints, and the body- scanning machine has been installed for this pilot program at just one. About 8,000 travelers a day move through this checkpoint, says Paul Armes, security director at Sky Harbor for the federal Transportation Security Administration (TSA).

The backscatter will not be used for everyone who passes this way, at least not at first. A traveler would have to have set off alarms on the routine metal detector, or be randomly selected for further screening. Even then, travelers have two options: the new X-ray machine, or a pat-down, which has caused passenger complaints about invasiveness.

What the backscatter 'sees'

Privacy advocates remain wary of backscatter technology. Barry Steinhardt, director of the technology and liberty program for the American Civil Liberties Union, likens it to a "virtual strip search." He hasn't seen a demonstration of the latest version of the technology, but he saw an earlier one at a Los Angeles city jail.

"The one I saw was very graphic, almost like a nude picture," he says. The technology has not been installed at airports until now because of questions about privacy and how well it can detect possible weapons, adds Mr. Steinhardt. "Utility is ... important here. People are being asked to trade their privacy for security. But first show us there is some security [benefit]."

Backscatter technology has been around for years, says Joe Reiss, vice president of marketing for American Science and Engineering Inc. (AS&E), which makes the backscatter being tested in Phoenix. The technology has been used, for example, to check large cargo containers and passenger vehicles.

"About 15 years ago, this technology was incorporated in personal [body] scanning systems," Mr. Reiss adds. For airport use, AS&E has adjusted the technology so that what's depicted is only an outline of a passenger – with private parts blurred – and any objects on him or her, such as "a handgun, or a blade of a ceramic knife that wouldn't be discovered by a metal detector."

"This technology gives us an additional layer of capabilities to detect objects," says Michael Golden, a technology expert for Southwest Airlines, who is on loan to the TSA. "This actually will show us where prohibited items are on the body," he says, though he declines to name all objects this machine can detect. "We think it is a good balance between security and privacy."

Other officials say the backscatter will be able to detect several items that other security technology – including metal detectors – cannot. Those items include plastic or ceramic knives, plastic explosives, and some liquid explosives. They say it can at best prevent a bomb plot like the one uncovered in London last summer, in which alleged terrorists planned to attack using liquid explosives.

What the screened passenger does

Here's how the screening is working so far. A traveler, after agreeing to the X-ray, is walked through the process by a TSA employee. He or she stands on the red-painted footprints facing the scanner, with arms raised as if a police officer had yelled, "Hands up." Then the traveler turns around for a back pose.

Another TSA employee in a tiny, walled room about 50 feet away assesses the image. A man views images of male passengers, and a woman views images of women. The images are not stored, government officials say, and they aren't transmitted anywhere else. The process should take about 30 seconds.

Kenneth Johnson, a Vietnam veteran with artificial shoulder joints and an artificial knee, was among the first to be pulled out of line Friday for closer screening. He chose the backscatter X-ray over the pat-down, saying he didn't mind it a bit.

As the TSA decides whether to buy the $100,000 machine, its pilot project is expected to last up to 90 days. It may be expanded later this year, using another manufacturer, at Los Angeles International Airport and John F. Kennedy International Airport in New York.

"We want to look at the operational capabilities of this machine and have a dialogue with the public about their perceptions of its use," says Ellen Howe, assistant administrator for the Department of Homeland Security.

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A teen speeds. Police ram car. Who's at fault?

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p01s04-usju.html

Opposing sides say the ruling on an upcoming Supreme Court case might encourage dangerous driving – or increased use of force.

By Warren Richey Staff writer of The Christian Science Monitor

WASHINGTON

Victor Harris zoomed at 80 to 90 miles per hour in his Cadillac covering nearly nine miles in six minutes with a deputy sheriff hot on his tail. But when the chase ended in a violent crash that left the 19-year-old driver a quadriplegic, the roles reversed.

Now it is the deputy sheriff being pursued – by lawyers who say the officer violated the teen driver's constitutional rights when he forced the speeding Cadillac off the road.

Tuesday, Mr. Harris's case arrives at the US Supreme Court where the justices must decide whether drivers who speed and disobey police commands to pull over nonetheless are constitutionally protected against having their cars rammed by law-enforcement officials in high-speed chases. The Fourth Amendment prohibits police from using unreasonable tactics during arrests.

A ruling in the case could set national policy for the measures police can use in high-speed chases.

More than 350 individuals are killed each year in the US in crashes related to high-speed pursuits by law enforcement, according to the National Highway Traffic Safety Administration.

The statistics show that in most instances – nearly 230 times per year – it is the fleeing suspect who dies. In contrast, roughly five police officers are killed each year in high-speed chases. The rest of the fatalities are bystanders, according to the NHTSA.

At issue in the Harris case is whether Coweta County (Ga.) Deputy Sheriff Timothy Scott acted reasonably when he tried to bring Harris's car to a stop by ramming it during the March 2001 pursuit.

If he acted reasonably the deputy is entitled to qualified immunity and Harris's lawsuit must be dismissed. In contrast, if he used excessive force in a way that was clearly established to be unconstitutional at the time of the chase, the deputy loses his immunity and can be sued.

Harris's lawyers say the deputy used excessive and deadly force against a fleeing traffic offender who posed no immediate threat to others. Craig Jones of Atlanta admits that his client was speeding and that the teen panicked and sped away. But he denies that Harris ever did anything to threaten the police or other motorists.

"The law requires that there must be some violent resistance to being arrested as opposed to merely running away," Mr. Jones says. He says police are not permitted to shoot an unarmed fleeing suspect in the back, and likewise they are not allowed to use the kind of high-speed pursuit tactics that might kill or paralyze a driver because of a mere traffic violation.

Deputy Scott's lawyers view the case from a different perspective. They say Harris posed an escalating danger to the public through his foot-to-the-floor driving and that the deputy acted reasonably to defuse the danger posed by Harris.

"He was driving at speeds averaging 90 miles per hour on two-lane roads with cars in both directions. If there was a car in his way he would drive on the wrong side of the road," says Scott's lawyer, Philip Savrin of Atlanta. "This had all the earmarks of ending in tragedy."
Ruling: a boon to chasers or chased?

Both sides warn of grave consequences if the justices rule for their opponent. A ruling against the deputy might be a green light for fleeing motorists to try even harder to elude police, knowing that deputies can only pursue with flashing lights and blaring sirens. A ruling against the motorist might encourage police officers to use increasingly dangerous tactics to end chases.

In a friend-of-the-court brief, US Solicitor General Paul Clement says Scott did not violate Harris's Fourth Amendment rights. The level of force used was proportionate to the threat of Harris's dangerous and reckless driving, Mr. Clement writes. "In light of the risk of serious injury or death that such conduct posed to the pursuing officers, other motorists, or pedestrians, [Scott] reasonably decided to try to bring [Harris's] vehicle to a safe stop by bumping it from behind."

The courts must analyze the situation from the perspective of a reasonable police officer faced with a confused and unfolding situation, rather than with perfect 20/20 hindsight, the solicitor general says.

The incident began at 10:42 p.m. on March 29, 2001. A Coweta County sheriff's deputy clocked Harris's Cadillac traveling 73 m.p.h. in a 55 m.p.h. zone. The officer flashed his emergency lights, but Harris just kept going.

The deputy took chase and was soon joined by Scott. Both officers watched as Harris crossed the solid yellow line on a two-lane country highway to pass other cars. Twice he ran red lights. And at one point the Cadillac nearly collided with a police cruiser as the deputy tried unsuccessfully to trap Harris in a parking lot.

A radioed OK, a spin, then a crash

Finally, Scott radioed a supervisor and asked for authorization to attempt a maneuver to cause the fleeing Cadillac to spin out of control.

"Go ahead and take him out," the supervisor replied.

When Scott rammed Harris's rear bumper, the Cadillac spun out, flipped, and rolled down an embankment.

Jones says Harris tried to outrun the deputies because he was driving with a suspended license and didn't want to go to jail. As the chase continued, Jones says, Harris accepted the idea of going to jail but he wanted the arrest to take place at his home so his car wouldn't be impounded.
He never made it.

"He was a 19-year-old kid who was not thinking clearly," Jones says.

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Former Afghan warlords rally for amnesty

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p06s01-wosc.html

Some see a new amnesty bill as a necessary step for stability; others see it as a free pass for war criminals.

By Mark Sappenfield Staff writer of The Christian Science Monitor

KABUL, AFGHANISTAN

In one corner of a soccer stadium that has seen both athletic contests and executions stands a poster some 20 feet tall of Afghanistan's president, Hamid Karzai. Perhaps appropriately, Feda Mohammad Mujahid has turned away from it.

The 25,000 Afghans crowded into this bare concrete oval hoist up different posters of stern-faced mujahideen commanders who first fought the Soviets, and then each other, before joining with America to oust the Taliban in 2001.

To Mr. Mujahid, wrapped in a white scarf against the winter chill, these are the heroes of Afghanistan's "holy wars," not war criminals. So he has come here to rail against Mr. Karzai and the tyranny of Western nations, which have opposed an Afghan bill that would grant the mujahideen amnesty for war crimes committed during the past 25 years.

"This is a mujahideen nation," he says, as nearby loudspeakers crackle with speeches of defiance. "We want the law of Islam, and the government of mujahideen."

Away from the teeming streets around the stadium, the attitudes of average Afghans take on a different air. Many express frustration that former military leaders who killed thousands and destroyed Kabul in a four-year civil war might never be brought to justice. Yet in a country still divided by tribes, tongues, and traditions, Friday's rally sent a clear message – that even now, Afghanistan's onetime warlords alone have the power to muster the masses.

In this rally, "you saw their continuing ability to mobilize people and to potentially influence politics," says Paul Fishstein, director of the Afghanistan Research and Evaluation Unit, an independent analysis organization here.

Some see amnesty as political ploy

The bill itself, which was recently approved by both houses of Afghanistan's parliament, has attracted international attention largely because it has been portrayed as a self-serving political ploy. Those likely to benefit most from the legislation are legislators and government officials themselves, many of whom are former mujahideen who stepped into the political vacuum following the fall of the Taliban.

Among the speakers at Friday's event were members of parliament, the vice president, the president's top security adviser, an army chief of staff, and an energy minister.

To them, amnesty does offer a measure of self-preservation. The momentum for warlord amnesty here began after the execution of former Iraqi leader Saddam Hussein, a onetime US ally.

Former mujahideen members of parliament "thought that there might be a day that maybe they will face the same thing that Saddam Hussein faced," says Najibullah Kabuli, a member of the lower house of the Afghan parliament, the Wolesi Jirga, who abstained from voting on the amnesty bill because he thinks it is too broad.

"Didn't the US support the mujahideen?" asks protester Abdul Malik, noting how the mujahideen, too, were allies of the United States during the Soviet invasion of Afghanistan in 1979.

Even after the fall of the Taliban, the international community could have taken a stronger stand against allowing former warlords into politics, says Mr. Kabuli, the member of parliament. For a country that has been at war for 25 years, "it was not possible to have a government that was free of war criminals," he says. "But it was possible for the government to have fewer of these."

As the political winds have shifted from a focus purely on stability to issues of human rights and good governance, former mujahideen have emerged as an easy target.

A report by Human Rights Watch, for instance, called for several members of the government to be tried for war crimes.

"Human Rights Watch should consider the stability of Afghanistan, otherwise Afghanistan will go toward crisis again," cried security adviser Mohammed Qasim Fahim. "This country we have today was created by the holy war, by the mujahideen, and by their sacrifices."

In this conviction lies the warlords' greatest power. In a nation with a tribal heritage and a history of endless foreign interventions and abandonments, Afghans have come to trust only on those closest to them. As a result, warlords are able to mobilize unshakable support though regional or ethnic alliances.

Protesters say amnesty brings unity

For those who slogged through the mud of Kabul's soccer stadium, thrusting frenzied fists into the air and bearing massive posters of commanders around the field in a triumphal march, the amnesty is partially an act of healing these historic rifts. Mujahideen commanders who once turned Kabul to rubble in their attempts to kill each other were now standing side by side.

"This is a war-torn country," says Mujahid, his hands folded behind his back, counting crimson prayer beads. "We have suffered a lot and we don't want to fight each other again."

"Let's forget about the past and think about a prosperous future," he says. "We want to be united."

A peaceful protest is a part of that message, some say. "We want to show the people of the world that one day we were evil to each other, but we can be peaceful, too," says Mr. Malik.

However, many Afghans and experts alike are skeptical. "These things tend to be cyclical – there tend to be alliances of convenience," says Mr. Fishstein.

Far from the echoes of the soccer stadium, Kabul resident Mohammad Ewaz sits on a stone wall in the hills high above the Kabul plains. In the amber light of late afternoon, he sips his tea, taking a break from the new wall he and his friends are building a few feet away.

Farther down the slope, the remnants of shattered houses, destroyed in the civil war, emerge from the hillside. "This is the work of the people who are asking for amnesty," he says.

"If they are really intending to bring unity, then it is a good idea," he adds. "But if it is just words and nothing else, then I don't think that it is a useful thing."

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Wall Street adds climate change to bottom line

from the February 27, 2007 edition - http://www.csmonitor.com/2007/0227/p01s02-usec.html

The environmentally tinged takeover of TXU Corp. illustrates global warming's increased financial relevance.

By Ron Scherer Staff writer of The Christian Science Monitor

NEW YORK

Wall Street now views the color green as something other than money.

In the latest sign that global climate change is becoming a major factor for investors, potentially the largest private takeover in the nation's history has environmentalists' fingerprints all over it.
A consortium of private investors announced Monday they would pay almost $45 billion to acquire TXU Corp., which generates electricity in the state of Texas. What makes the deal more than just another gigantic financial transaction is that the buyers of the company consulted with environmental groups and agreed to sharply scale back plans to build new coal-fired power plants.

"This is a real breakthrough, an indication investors are paying attention to the real financial risk associated with climate change," says Dan Bakal, director of electric power programs at Ceres, a Boston-based environmental group that advises investors controlling $3.7 trillion in assets. "It means Wall Street is really beginning to pay attention."

Wall Street analysts believe the deal could mean that future takeovers will start to factor in the cost of corporate carbon emissions.

This could affect mergers and acquisitions in a broad range of industries, including manufacturing companies, the auto industry, mining companies, and other utilities.

"What it shows is the environment has a much greater presence than in the past and the issue of global warming is under increased scrutiny," says Sam Stovall, chief investment strategist at Standard & Poor's in New York. "These are additional factors that must be addressed in future mergers."

In fact, there are some signs Wall Street is trying to get up to speed as quickly as possible. For the past three years, the World Resources Institute (WRI), an environmental think tank in Washington, D.C., has been working with investment banks and securities firms such as Merrill Lynch, Citigroup, and Goldman Sachs to teach them how to establish their own carbon "footprint" and analyze other companies' emissions.

Analysts eye carbon 'footprint'

By calculating the footprint – the amount of greenhouse gases a company pumps into the atmosphere – analysts can begin to forecast the potential risks of climate-change lawsuits and future costs of any greenhouse-gas regulations.

"It's been a slow start, but we have been pleased to see financial institutions begin to grapple with those systems," says Jennifer Layke, deputy director of climate and energy for WRI. "But this is the first time we have seen a set of investors reach out to the environmental community around the terms of a new investment deal."

Last year, the New York Stock Exchange began to educate CEOs about the issue. It sponsored a lunch with former Vice President Al Gore, who gave a slide-show version of his Oscar-winning documentary, "An Inconvenient Truth."

Investors call for carbon accounting

This year there will be a record number of shareholder resolutions asking companies about their carbon footprint.

Normally, shareholder propositions don't receive much traction in the corporate world.

But, the proposals have been receiving a significant amount of institutional support from such large shareholders as Calpers, the California public-employee pension fund. And there is increasing concern that corporate boards may have a liability if they don't start to plan for future limits on carbon emissions.

Pressure was already building on TXU to scale back its proposal to build 11 coal-fired power plants. Over the weekend, Ceres issued a report that looked at the potential carbon taxes the utility would face, assuming that Congress or the states begin to enact such charges.

"Our report made some reasonable assumptions, including that none of the costs would be grandfathered in," says Mr. Bakal. "That means 100 percent of the carbon dioxide must face a carbon tax, which we estimate could be as much as $780 million per year, perhaps for 15 years."
At the same time, the Ceres report called into question some of the revenue and cost
assumptions that TXU had made to justify the new plants.

"We think they had overestimated the amount of growth and underestimated the amount of the coming carbon controls and the cost of complying with the existing Clean Air Act," says David Gardiner, one of the authors of the report and a sustainability consultant in Arlington, Va.

TXU buyers moved to ease opposition

Some of these issues resonated with the group of TXU buyers, which includes the Texas Pacific Group, Goldman Sachs, and Kohlberg Kravis Roberts & Co. Texas Pacific and KKR are private equity groups that amass money from pension funds and wealthy individuals and buy companies.

Monday, in Dallas, the buyers' group said they would drop eight of the 11 new coal-fired power plants if their deal succeeds. They also said they would roll back electricity rates by 10 percent. And, they indicated they would work towards meeting any national emissions caps in the future.
"It's a sign people are paying attention," says Rodney Taylor, managing director of the environmental-services group at Aon, a large Chicago-based insurance broker. "From a financial standpoint, it also says something about the perception of where energy costs are going. KKR is kind of a medium-term investor, so they must be looking at energy costs going up sharply over the next three to five years."

• Wire reports were used in this report.

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Fixes for accurate vote counts

from the February 27, 2007 edition - http://www.csmonitor.com/2007/0227/p08s02-comv.html

A House bill would insist on paper trails in voting disputes. Training poll workers is a bigger issue.

The Monitor's View

Ever since the 2000 presidential voting snafus in Florida, Congress has tried hard to ensure that each voter's vote is counted. But bills introduced this month target the least of the system's problems – verifying results from electronic voting machines.

Of more concern should be the work-a-day pieces of the electoral puzzle, such as ballot design, training for poll workers, and voter registration methods. These have the potential to disenfranchise more voters than balky machines.

The latest poster child for possible problems with digital voting involved a tight US House race last November in Florida's 13th Congressional district, which includes Sarasota County.

The GOP candidate eked out a 400-vote victory over the Democrat. In Sarasota County, touch-screen machines were at first judged to have failed in recording votes in the race from 13 percent of voters casting ballots in other races. Other counties in the district recorded only a 5 percent "undervote." Last Friday, the state gave its final report on the troubles: The machines worked as designed – it was the way on-screen ballots were displayed that most likely caused the "undercount."

The House race appeared at the top of a screen mainly devoted to state races, violating the "best practices" axiom: Only one race per screen "page." Voters skipped over it. Sen. Dianne Feinstein (D) of California has asked the Government Accountability Office to investigate electronic voting techniques, with a focus on machines used in Sarasota.

The proposed bills, which would amend the 2002 Help America Vote Act, might have helped. They stipulate that electronic voting machines used in federal elections must leave a "paper trail" – paper ballots or receipts that voters can use to verify their choices before their vote is "cast." Paper would beat machine in any dispute, unless there's "clear and convincing" evidence that the paper record has been compromised.

Even if voters verify their choices, however, paper ballots can be – and are – mishandled. Too often ballots or boxfuls of ballots are handled by only one person and out of sight of others. Or ballot boxes are improperly transported. The bills in Congress would be stronger it they set up a third "arbiter" – for example, the immediate transmission of a vote to a secure archive off site.

Yet such fixes aren't enough. Researchers with groups such as the Caltech/MIT Voting Technology Project have noted that new voting technologies have shaved the number of "uncounted" votes – either intentional or unintentional "non-votes" – from 1.91 percent in 2000 to 1.07 percent four years later. The challenge: Even in states using the latest high-tech voting tools, old problems with registration, ballot design and mishandling, and poorly trained election workers, crop up.

By one estimate, some 2 million to 3 million voters in 2000 were "lost" because of registration issues. Often, poll workers receive minimal training or are not rigorously tested – even on tasks as simple as fixing printer jams. And they need tighter supervision on Election Day.

In their quest to ensure that every ballot counts, federal, state, and local election officials need to redouble their efforts to cast a wider net.

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Activists put CEOs in a fishbowl

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p13s01-wmgn.html

More shareholders are combining forces to scrutinize the practices of upper-level management.

By G. Jeffrey MacDonald Correspondent of The Christian Science Monitor

Columbia University freshman Nick Serpe doesn't own any stocks or mutual funds, but that minor point isn't keeping him from becoming a shareholder activist.

"The tuition we pay is going to the university endowment, so we do consider ourselves shareholders," says Mr. Serpe, who had never heard of shareholder activism six months ago. Together with other students, he's now calling on Columbia to use its clout as a big Chevron stockholder to solicit a report that would address, among other things, pollution caused by nearly three decades of oil drilling in Ecuador.

As winter winds down, activists of varied stripes are gearing up for a new spring season of shareholder meetings by linking up with allies and upgrading their approaches. They're tapping into new networks, formed in the past three years, to rally grass-roots investors behind various causes. They're also reaping the benefits of new disclosure requirements intended to demystify mountains of paperwork and legalese that have traditionally enshrouded the inner workings of corporate boards.

In the big picture, observers say, a multiyear trend toward holding management accountable is to some degree trickling down to strengthen the hand of those who actually own public companies: their shareholders. Corporate scandals in 2002 and 2003 led not only to the Sarbanes-Oxley Act, which tightened financial reporting requirements, but also to today's environment where investors can more easily make their voices heard.

"Sarbanes-Oxley essentially empowered directors" to oversee management more effectively, says Carol Bowie, vice president of governance research services for Institutional Shareholder Services, an advisory firm. "But shareholder empowerment is what's going on right now.... We are seeing directors respond to shareholders, and directors don't like to get low votes [on annual meeting agenda items]. So they respond to that."

Executive pay packages examined

This year, shareholders driven by social and financial concerns alike are targeting executive pay packages. Efforts to rein in compensation formulae have spawned 239 proposals, up from 175 in 2006, according to a mid-February ISS analysis. Nearly 1 in 4 of all 984 proposals filed at public companies this year addresses executive compensation.

Median cash income for CEOs climbed from $1.8 million in 2002 to $2.4 million in 2005, according to the most recent Mercer Human Resource Consulting survey of 350 large public companies. Total compensation packages, which include such long-term incentives as restricted stock, climbed from a median of $6.1 million to $6.8 million over the same three-year period.

From the first meetings in March until the season winds down in late June, shareholders will be debating how to keep the boss from being overpaid. Should CEO compensation be subject to shareholder review before a board gives its approval? Should pay-for-performance incentive programs be restructured to get better results? Proposals vary from firm to firm, but all seem designed at least to blunt a repeat of Home Depot's 2006 payoff. CEO Robert Nardelli, who failed for six years to boost the company's stock price, ultimately resigned with a $200 million severance package.

Besides highlighting such cases, activists should also benefit from new SEC rules, requiring companies to disclose total CEO compensation in one location where it's easy to decipher.

"[It] can cause some real shock reaction," says Ralph Ward, publisher of the online magazine Board Room Insider. "This is giving shareholders a lot more ammunition."

Mr. Ward also expects shareholders to review executive perks – such as private jet travel – more carefully now that firms must reveal all such expenses in excess of $10,000.

Ward notes that this year's raft of pay-related initiatives almost exclusively target firms that have performed weakly. That's because he says shareholders can generally stomach big salaries, generous stock options, and perks for leaders when an organization is thriving. Conversely, he says activist shareholders are most likely to agitate and prevail this year at the likes of Hewlett-Packard, United Health, and other companies eager to improve board oversight in the wake of reports highlighting governance problems.

"Only companies that have found themselves in trouble are the ones who are the trail blazers" in embracing reform, Ward says. "Essentially, they're vulnerable. They're the weakest of the herd. If you're trying to get some governance change put in, they're the ones that you go to."

In principle, shareholders big and small alike have a voice in how a company is run. Each gets to vote on proposals that come before the annual shareholder meeting. If a shareholder can't attend the meeting, he or she may vote by proxy by filling out a ballot that arrives via postal delivery or e-mail, usually in February or March. Investors in mutual funds may "vote" by urging the fund, through its investor-relations office, to vote a certain way on resolutions pending at firms in which the fund is a stakeholder.

Still, even with new regulations increasing boardroom transparency, corporate America is no democracy. Shareholder votes are purely advisory and nonbinding upon a board of directors. What's more, because big shareholders get more votes than small ones, institutional investors such as mutual funds and pension funds tend to carry the most influence.

"I don't think that, as an individual investor, unless you're [billionaire activist] Carl Icahn, you're going to have much impact," says Jay Eisenhofer, a Wilmington, Del., lawyer who represents institutional shareholders and is author of "Shareholder Activism Handbook" (Aspen, 2005). "It's just not a realistic sort of goal.... You're much more likely to have an impact by having an association with an institution and influencing them to take action."

Investors with a social-change agenda

Increasingly, stakeholders are organizing with hopes of steering institutions to use their stock to advance an agenda. Retirees from Verizon and Qwest Communications, for instance, last year lobbied their respective boards to rein in rosy assumptions used in calculating a top executive's compensation package. Labor unions and the Sierra Club have embarked on new outreach efforts in the past two years to educate members about letter-writing campaigns and other tactics for influencing corporate directors. Amnesty International is beefing up its year-old Share Power campaign, which equips activists in about 30 groups with tools and strategies to nudge institutions to vote with human rights in mind.

"Because of the enormous power of multinational companies around the world ... we cannot have human rights gains without their cooperation," says Amy O'Meara, coordinator of Share Power. She's hopeful, she says, because with the rise of globalization "companies are really realizing that they are connected to these issues in ways that they weren't 20 years ago."

For investors interested in social issues, 327 resolutions at companies are awaiting action this spring. Many call for corporate reports on one of two issues: a firm's environmental impacts, such as having a role in global warming, or its political contributions. Among other closely watched issues is whether shareholders will gain more say in processes for nominating and approving directors who represent their interests on a governing board.

As shareholder activists learn to raise their voices, observers differ on whether the movement is coming to fulfill its potential as a force for positive social change. In the optimistic camp: the Rev. Michael Hoolahan, interim director of the Interfaith Center on Corporate Responsibility, where shareholder activism has been a priority since its inception in 1971.

"We see a burgeoning movement," Father Hoolahan says. "There are many, many new voices [over] what there were 10 years ago. It's really blossomed."

Don't throw that proxy away

But activism consultant Bartlett Naylor sees a wealth of untapped power. Too often, he says, people otherwise interested in improving their society discard their proxy ballots as junk mail.
"It remains disappointing to me how much the average guy remains oblivious to the fact that the major force shaping public policy in America is the corporation," says Mr. Naylor, principal of Capital Strategies Consulting in Arlington, Va. "And the one time that the average guy has something to say something about that, he is throwing that chance into the trash."

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Why US is now turning to diplomacy

from the February 22, 2007 edition - http://www.csmonitor.com/2007/0222/p01s04-usfp.html

After success with Libya and North Korea, the US is bringing its multilateral approach to Iran.

By Howard LaFranchi Staff writer of The Christian Science Monitor

WASHINGTON

A UN report expected to be issued Thursday, finding Iran undeterred in its pursuit of uranium enrichment, represents the kind of collective international action the Bush administration once scoffed at. Now, it's embracing it.

The change stems in part from the administration's disenchantment with the results of its earlier go-it-alone approach. But it also suggests a growing sense within the White House that once-maligned multilateralism is getting results – on issues ranging from Iran to North Korea.
The latest example is Iran. The International Atomic Energy Agency's report on nuclear activity in Iran will find that Tehran has ignored a United Nations Security Council deadline to cease uranium enrichment by Wednesday.

Instead, the IAEA report will show that Iran has installed additional centrifuges in enrichment facilities, sources close to the IAEA work say. It will also note Iran's continuing technical problems in perfecting the process.

The report is likely to set in motion renewed debate on Iran in the Security Council, perhaps next week. Pressure is building for a second, more punitive resolution, since the regime has apparently disregarded a Dec. 24 resolution approved unanimously by the Security Council – including Tehran's political and commercial partners, Russia and China.

Whether a second resolution is ever approved, the debate will highlight a change in the Bush administration, both specifically on Iran and more broadly on the diplomatic field.

"What we're witnessing is the return of the pragmatists to US diplomacy, and it's paying off," says Joseph Cirincione, a nonproliferation expert at the Center for American Progress in Washington. "The Bush administration came in touting 'regime change' and a fundamental break with nonproliferation negotiations, but that backfired. In many ways the world ended up more dangerous."

But after a long campaign in Iraq, Iran's rise, and a nuclear test by North Korea, the US is putting new faith in diplomacy, hard bargaining, and multilateral action, he says. "It worked with Libya. It's working with North Korea. And it could work with Iran."

The change in the US approach comes amid mixed signals from the White House, on Iran in particular. Last week President Bush linked an uptick in US casualties in Iraq to more sophisticated weaponry coming from Iran, and said he planned to "do something about it." Such talk keeps alive speculation that the US may opt to move militarily against Iran's nuclear installations.

But the administration's growing reliance on diplomatic efforts is also evident on the international stage, with America's partners in particular taking note of the shift. "We have noted the evolution," says a senior European diplomat in Washington, who by protocol cannot speak on the record.

The US initially was unhappy with the Security Council resolution on Iran, which ended up with weaker sanctions than the US wanted. But after the resolution set off an immediate debate in Iran over the confrontational tactics of President Mahmoud Ahmadinejad, some US leaders began to have a change of heart.

"The debate it caused in Iran and the pressures inside the country on [President] Ahmadinejad changed things," says the European diplomat. "So now the feeling is, why not a second resolution?"

The Bush administration's apparent conversion to multilateralism can also be seen in Secretary of State Condoleezza Rice's efforts to revive the Middle East peace process and in last week's deal with North Korea on its nuclear program. Next week, Secretary Rice's new right-hand man, John Negroponte, is travelling to northeast Asia to try to build on the goodwill stemming from the nuclear accord.

The North Korea issue shows that the Bush team has had two tracks of diplomacy all along – the go-it-alone track and a less-noted multilateral track – but has recently switched which track it emphasizes, some experts say.

"The stereotype of the Bush administration was the go-it-alone approach, and it got stuck with that in the first term largely because of the war in Iraq," says Daniel Drezner, a foreign policy expert at the Fletcher School of Law and Diplomacy in Medford, Mass. "But there's always been this second track, albeit overshadowed, of trying to work in concert with others for common goals. Now that the US has become bogged down in Iraq, there is less it can do unilaterally."
The arrival of Rice, a trusted Bush aide, at the helm of State is part of the explanation for the shifting emphasis between the two tracks, Mr. Drezner says.

But the administration is also harvesting the fruits of an early diplomatic goal of tying rising world powers such as China and India into the world international system, he says. One result is an intense US effort to court India and cement its ties to the broader international community, he says.

India Wednesday said it will ban exports to Iran of materials that might be used in Tehran's nuclear program. India's statement is the latest sign of growing international alignment with the Security Council resolution.

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States race to set earlier primaries

from the February 20, 2007 edition - http://www.csmonitor.com/2007/0220/p01s01-uspo.html

Eager to field stumping presidential candidates, nine states are jockeying for front-of-the-pack dates.

By Daniel B. Wood Staff writer of The Christian Science Monitor

LOS ANGELES

California is poised to play the first card in what experts say will be a national game of "reschedule your state's primary." The stakes: which state can gain significant influence over the presidential nominating process.

California's bid to move its 2008 primary from June to Feb. 5 – already approved by the state Senate and expected to clear the Assembly this week – is intended to force presidential candidates to stump in the Golden State, addressing issues dear to voters here before the contest is all but decided by others. Gov. Arnold Schwarzenegger (R) has said he will sign the bill.

But already, nine states have tentatively scheduled primaries or caucuses for Feb. 5, and more may pile on as states jockey to meet notification deadlines: May for Democrats, September for Republicans. Among the delegate-rich states considering that date: Illinois, New Jersey, and Texas. Florida has a bill pending that would leapfrog them by moving its primary to Jan. 29.
The irony in all the jockeying is that, with so much change afoot, no state may achieve its aim, analysts say. The probable outcome of a front-loaded primary schedule is an early winnowing of the candidate field, with Feb. 5 becoming a do-or-die date, and a clipped-back period of time in which voters can assess presidential hopefuls at town halls and in their living rooms.

"California and other states that are trying to play calendar games are apt to find out that their plans backfire," says Larry Sabato, a political scientist at the University of Virginia. "We are courting disaster."

Feb. 5 could become a de facto national primary, political analysts say, because candidates who underperform in that vote would have trouble attracting donations that allow them to continue campaigning. And the party nominations could easily be sewn up in the three weeks between the Iowa caucuses on Jan. 14 and the Feb. 5 sweepstakes – giving the public insufficient time to watch and test the candidates, they say.

"With that many states front-loading their primary dates, the presidential campaign may get closure sooner, but people in each party may end up regretting the choice," says Jack Pitney, a political scientist at Claremont McKenna College in California. He cites the meteoric rise in 2004 of Howard Dean, the early Democratic front-runner, who later flamed out when voters watched him more closely over months of campaigning.

"They may find out things about the anointed nominees that they don't like, but find them out too late," says Dr. Pitney.

If states such as Florida, Michigan, and Illinois follow California's lead, he and others say, presidential nominations for both parties could be sewn up 10 months before the general election in November.

"We are about to have the most extended presidential campaign in American history, and that is the last thing the public wants," says Mr. Sabato.

These assessments do not cancel out the rationale for California and other states that want more clout in who picks presidential nominees, analysts say.

"A Feb. 5 primary for California means California issues are finally going to be addressed by the candidates, rather than just farm or New England issues," says Robert Stern, president of the Center for Governmental Studies. "It means California voters – not just California donors like big Hollywood celebrities – [would] have a bigger say in the presidential primary."

If candidates are forced to consider California voters, concerns such as offshore oil drilling, illegal immigration, national security, and the environment might move up the issue agenda of candidates, say Mr. Stern and others.

Campaign styles and strategies may also be affected if more states move their primaries to Feb. 5. Campaigns in the early-voting states of Iowa, New Hampshire, and South Carolina have been characterized by up-close-and-personal meetings in coffee shops, meeting halls, and restaurants. If states with big populations and large terrain – like California – are added to the early-primary mix, candidates will no doubt adjust their money-raising and money-spending strategies.

"You won't see Hillary [Rodham] Clinton coming out to shake hands with voters in a small restaurant in L.A.," says Stern. "The state is simply too big. She'll need to spend her money more on television ads, radio, organizing staffs and logistics."

A candidate would also need more money earlier, to even consider a presidential race. That would represent a big change, some say. The day would be over when a candidate could plan to build a viable candidacy by attracting enough voters in a small state, and hope momentum and funds snowball from there.

The only way to end the primary chaos is to pass a constitutional amendment that would create a more uniform primary voting structure, says Sabato. One idea, he says, is to create four regional primaries – one each in April, May, June, and July, with national party conventions in August. The order of the regional primary votes would change with each presidential election cycle, decided by lottery Jan. 1.

"This would kill the permanent campaign because no [candidate] would know where to start and would eliminate the slingshot effect of winning just a couple of early primaries and vaulting to national prominence," says Sabato. "It makes so much sense it will never happen."

States push for earlier primariesNine state legislatures have bills pending that would move up their presidential primary date next year. Current date / Proposed dateArizona Sept. 9 / Sept. 2California June 3 / Feb. 5Florida March 11 / Jan. 29Illinois March 18 / Feb. 5Indiana May 5 / March 3Nebraska May 13 / Feb. 9New Jersey Feb. 26 / Feb. 5Pennsylvania April 22 / March 4Texas March 4 / Feb. 5Source: National Conference of State Legislatures

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Before any votes, a 'money primary'

from the February 26, 2007 edition - http://www.csmonitor.com/2007/0226/p01s01-uspo.html

The race to raise funds, hire top staff, and generate media buzz for the 2008 presidential election is already well under way.

By Linda Feldmann Staff writer of The Christian Science Monitor

WASHINGTON

It was "money, and only money," that led former Iowa Gov. Tom Vilsack to drop out of the 2008 presidential race last Friday. What the Democrat meant, of course, was a lack of money. Not hard work or desire.

Politicians often speak of fundraising with disdain, but in fact, the money that donors are willing to shell out to candidates represents an important signal of a candidate's viability. Even if much of the public is not fully engaged in the intense nomination races under way in both parties, wealthy donors are. And they're voting with their checkbooks.

It's all part of what's come to be known as the "invisible primary" – the early jockeying for money, top campaign staff, and high-profile endorsements that winnow the presidential field long before any caucuses or primaries are held. A fourth piece, media buzz, magnifies the effect of the other three.

"Organization, fundraising, and endorsements are all various forms of currency, or various bets on the probability that a candidate will finish first or in the [top three]" in the early nominating contests, says Cal Jillson, a political scientist at Southern Methodist University in Dallas. "No one wants to endorse a candidate they know will have to drop out early or won't be able to raise money or convince a top-drawer management team to take on their campaign."

Mr. Vilsack knew going in that he faced an uphill climb. Democratic Sens. Hillary Rodham Clinton of New York and Barack Obama of Illinois were likely to run, and a third likely candidate, former vice presidential nominee John Edwards, had already built up a strong organization in Iowa, which will hold the first nominating contest next January. All three ended up declaring, and currently occupy the top three spots in most polls of Democratic primary voters.

For Vilsack, one big trouble sign came in polls of his home state, where he typically polled fourth among Democratic presidential wannabes. Though he was a popular two-term governor, with a centrist approach, he never was able to carve out a national image among his own people, and, lacking the charisma of an Obama or an Edwards, could not attract much attention (or money or media or endorsements) outside Iowa. In the Iowa caucuses, he had to finish well if not first to keep going. But as the hometown candidate, the moment he did well, the import of the Iowa caucuses would have been discounted. So in effect, he was in a no-win situation.

One beneficiary of Vilsack's decision could be Gov. Bill Richardson (D) of New Mexico, the only other candidate with executive experience in the race. Governor Richardson also brings Washington experience – as a former congressman and Energy secretary – as well as foreign policy credentials, as a former UN ambassador and still part-time globetrotter and hostage negotiator, to the table.

But Richardson is another candidate who could face viability problems soon if he does not show some chops in the fundraising department. As the sitting governor of a state far from the key money centers, Los Angeles and New York, it will be hard for him to raise the kind of serious money he needs. Still, he's already well ahead of where Vilsack was when he pulled out. Last week, Richardson raised $2 million in a single fundraiser. Vilsack had raised just $1.1 million in the last seven weeks of 2006, and had spent most of it by the end of the year.

In this presidential cycle, money is more important than ever – especially since some top candidates have signaled they will forgo the public financing system and raise as much as they can on their own. Campaign-finance experts say that, to remain viable, a candidate needs to raise upwards of $20 million by June. Some top-tier candidates, like Clinton, can expect to do far better than that.

The Richardson and Obama candidacies have opened up mini invisible primaries within the larger one, one in the Hispanic community and the other among African-Americans. The challenge for both men is to compete against the Clinton machine, which has strong connections to both communities owing to the presidency of Clinton's husband, Bill Clinton, and his continuing popularity among both groups. (Richardson is Hispanic and Obama is black.)

The campaign of Hillary Clinton, which has worked all along to create an air of inevitability around her candidacy, has reached out to key players in both worlds and locked in talent and donors. For both Richardson and Obama, the ethnic/racial dimension has presented a challenge: Neither says he is running as the "Hispanic candidate" or the "African-American candidate," but those are natural ties that can produce important endorsements and donations.

And even as the overall Democratic field has shrunk, it may not be done growing either. Speculation persists that former Vice President Al Gore may yet jump into the race – one of the few people who could still do that and mount a viable candidacy, given his national fame and fundraising ability.

In a Pew Research Center poll released last Friday, most Democratic voters (77 percent) reported that they have not given the presidential campaign much thought and were not prepared to state which candidate they would support. Among those who were willing to name a candidate, Clinton came in first with 11 percent, Obama got 7 percent, Edwards got 1 percent, Gore got 1 percent, and 4 percent went to others.

Given that the invisible primary is taking place largely unnoticed by most Americans may strike some as undemocratic. In effect, the choices that voters will face early next year in the nominating contests are being shaped right now, before most people are paying attention. But the system has run this way for a long time. It was the influential GOP donors and governors who hand-picked then-Texas Gov. George W. Bush to run for president back in 1999. Ronald Reagan was tapped to run for president in similar fashion.

Still, the early importance of big money in the 2008 presidential cycle is unprecedented. "This may well be a very important year in that process, in the sense of more and more money being required to run," says Mr. Jillson.

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