Tech giants say SOPA piracy bill is 'draconian'

Tech companies say Congress' anti-piracy bills are 'draconian' and 'deeply flawed.' NEW YORK (CNNMoney) -- A proposed new bill intended to combat online piracy has sparked a giant backlash from big tech companies, including Google and Facebook, who say the proposals are far too strict and rife with unintended consequences. The Stop Online Piracy Act (SOPA), which was introduced in the House of Representatives in late October, aims to crack down on copyright and trademark issues. Its targets include "rogue" foreign sites like torrent hub The Pirate Bay. Print Comment Protecting content is a worthy goal, but here's the flip side: Opponents say SOPA -- and a similar bill called the Protect IP Act that is making its way through the Senate -- effectively promotes censorship. If SOPA passes, copyright holders would be able to complain to law enforcement officials and get websites shut down.

The law would also force intermediaries like search engines and payment processors to withhold their services from targeted websites. That would be quite a change from the 1998 Digital Millennium Copyright Act, which mandates that companies "act in good faith" to remove content that infringes on copyrights and other intellectual property laws. Google ( GOOG , Fortune 500) executive chairman Eric Schmidt called the bill "draconian" during a speech in Boston on Tuesday. Google and other tech behemoths -- AOL ( AOL ), eBay ( EBAY , Fortune 500), Facebook, LinkedIn ( LNKD ), Mozilla, Twitter, Yahoo ( YHOO , Fortune 500) and Zynga -- also lodged a formal complaint on Tuesday in the form of a letter sent to key Senate and House lawmakers. "We support the bills' stated goals," the letter reads. "Unfortunately, the bills as drafted would expose law-abiding U.S. Internet and technology companies to new uncertain liabilities [and] mandates that would require monitoring of web sites." The companies are asking Congress to "consider more targeted ways to combat foreign 'rogue' websites." SOPA's critics -- some of the Internet's most heavily trafficked sites -- launched an awareness campaign on Wednesday. Hundreds of sites adopted black "STOP CENSORSHIP" logos, including BoingBoing, Reddit and the Electronic Frontier Foundation. One site tried to annoy consumers into action. Blogging site Tumblr blacked out words in its content feeds, and a message at the top of users' dashboards read: "Stop The Law That Will Censor The Internet!" "Congress is holding hearings today and will soon pass a bill empowering corporations to censor the Internet unless you tell them no," Tumblr wrote in a post Wednesday, calling the bills "well-intentioned but deeply flawed." Meanwhile, SOPA has drawn support from groups including the Motion Picture Association of America and the Recording Industry Association of America, which say that online piracy leads to job loss. Proponents of the bill dismiss accusations of censorship. The legislation would "[prevent] those who engage in criminal behavior from reaching directly into the U.S. market," Judiciary Committee Chairman Lamar Smith, who introduced the bill, said in a statement Wednesday. "We cannot continue a system that allows criminals to disregard our laws."  

How to keep the power on during a storm

It took over two weeks for the millions who lost power in October's freak blizzard to get their electricity back. Burying power lines may help, but it costs a million dollars a mile. NEW YORK (CNNMoney) -- October's freak blizzard knocked out power for over 2 million people in the Northeast. In Connecticut, the hardest hit state, all the power lines weren't fixed until just last week. Storms have always wreaked havoc on the power grid.

But thanks to new technology and a growing trend to bury power lines underground, utilities are hoping to both cut the number of people who lose power in a storm and the length of time they are in the dark. Print Comment The best way to make a power line more resistant to an outage is to bury it. In Connecticut, 90% of power outages are caused by falling tree limbs, said Connecticut Light and Power spokeswoman Katie Blint. Underground lines fix the tree problem. But there's a catch, says Connecticut Light and Power: It costs at least a million dollars a mile to bury an overhead power line. Connecticut Light and Power is a subsidiary of Northeast Utilities Company ( NU , Fortune 500). It's hard to get an estimate as to just how much it would cost nationwide -- there are over 3,000 utilities in the country. Often, they each use different technology from one another. The power struggle for Wyoming's wind In Connecticut alone, 75% of Connecticut Light and Power's 17,000 miles of line are above ground. At a million a mile, that's nearly $13 billion to put them all underground. "It's a very, very expensive proposition," said Jim Owen, spokesman for the Edison Electric Institute, the national utility trade association. "At the end of the day, customers would have to bear the price of it." And burying lines comes with its own problems. While fool-proof against falling trees, they are still subject to outages caused by moisture. And when they fail they are harder to find and fix. Still, spurred by greater reliability and a desire for better aesthetics, most towns nationwide now require power lines in new housing developments to be buried along with other utilities like phone, Internet, water and sewage systems. It's more expensive than running the lines above ground, said Owen, but not nearly as expensive as burying an existing system. Fortunately for customers, there are other technologies in the works that aim to make above-ground lines more resilient. As part of the smart grid revolution, interconnected sensors are being added to power lines. The sensors can both limit the number of homes affected by an outage and shorten the time it takes to get the power back on. Known as 'self-healing' technology, so-called smart grids employ devices such as a recloser, which can reclose the electric circuit and restore power to areas past a downed tree, said Ben Kellison, a smart grid analyst at GTM Research. 0:00 / 2:20 Making sense of the Smart Grid Reclosers have been around for over 40 years, said Kellison, but not in widespread deployment. Other devices can be helpful too. Line sensors can detect changes in electrical wave formations, indicating where blowing tree limbs are getting too close to the power line. Utilities can hopefully be alerted to a potential problem months in advance and send a crew out to clear the branches. Line sensors have also been around for a while, but what's now rapidly advancing is the analytical software necessary to alert the utility to the problem in advance. With this new technology, "The number of customers affected is going to change dramatically," said Kellison, "as is the time." But this all may take a while to roll out. Thanks to the number of different utilities out there, and that fact that they all use quite different technology, Kellison said these types of smart grid innovations will be gradually added to the electric grid over a period of one or two decades.  

Keystone pipeline delayed by Obama until 2013

Decision on Keystone oil sands pipeline delayed until 2013. Environmentalists hope it will scuttle the project. NEW YORK (CNNMoney) -- Bowing to public pressure, the Obama administration said Thursday it will delay a decision on the controversial Keystone oil sands pipeline expansion until at least 2013. Citing concern over the proposed route through Nebraska's Sand Hills region and over the Ogallala Aquifer, the State Department said it needs more time to study the issues and look at possible alternative routes. Print Comment "Given the concentration of concerns regarding the environmental sensitivities of the current proposed route through the Sand Hills area of Nebraska, the Department has determined it needs to undertake an in-depth assessment of potential alternative routes in Nebraska," the State Department said in a statement.

The Nebraska legislature convened a special session last week with many state lawmakers calling for a change in the pipeline's course. Protesters encircle White House, demanding halt to pipeline project Based on previous pipeline permitting experience, the State Department said the review process "could be completed as early as the first quarter of 2013." In a separate statement, President Obama said he supported the State Department's move. "The final decision should be guided by an open, transparent process that is informed by the best available science and the voices of the American people," said Obama. The news set off a firestorm of comments from the pipeline's supporters and opponents, and shows just how political the issue has become. While the decision has been put off until after the presidential election, it will no doubt be seized upon by the president's supporters and opponents during the election season. House Speaker John Boehner criticized the delay. "More than 20,000 new American jobs have just been sacrificed in the name of political expediency. By punting on this project, the president has made clear that campaign politics are driving U.S. policy decisions -- at the expense of American jobs." However, the news was praised by environmentalists, who have been protesting the pipeline for months and hope the delay will ultimately lead to a scrapping of the plan altogether. "This is a major victory," said Daniel Kessler, spokesperson with Tar Sands Action. "It's a testament to the thousands of people who came out to protest in the streets, and we think the president responded to that." "We hope that the end result of the new review will show that the pipeline is not in the nation's best interest and it will be rejected," said Susan Casey-Lefkowitz, director of international programs at the Natural Resources Defense council. But TransCanada ( TRP ), the company that wants to build the $7 billion pipeline, showed no indication of scrapping the project, even though it previously said the added expense of trying to get new permits, plus the loss of customers who have signed up to take delivery of the oil, could lead the company to kill it altogether. "We remain confident Keystone XL will ultimately be approved," said Russ Girling, TransCanada's president and chief executive officer. "This project is too important to the U.S. economy, the Canadian economy and the national interest of the United States for it not to proceed." Indeed, the company confirmed it has already bought $1.7 billion worth of steel pipe. The 1,700-mile pipeline is supposed to take oil from Canada's oil sands region in Alberta to refineries on the U.S. Gulf Coast. 0:00 / 2:24 Lady roughnecks in North Dakota man-camps Environmentalists hated the project from the get-go, fearing the pipeline not only risks spills but would lock the U.S. into dependency on oil sands, a particularly dirty form of oil. Oil sands are just that -- oil mixed with sand. To get a useful type of crude, heat is used to separate the oil from the sand. The process results in anywhere from 5% to 30% more greenhouse gas emissions than extracting conventional oil would generate. There are also concerns that oil sands developments -- many of which look like giant open-pit strip mines -- decimate forests and pollute rivers and streams. Just this week the International Energy Agency warned that the world risks locking itself into dirtier forms of energy and will ultimately have to spend much more to clean itself up, unless more investments in renewable energy are made today. Nonetheless, the Obama administration was expected to approve the pipeline up until just a few weeks ago, largely on the grounds of energy security and economic development. IEA sees danger in rising oil, coal use But the intensity of the protests turned up the heat on the Obama administration, and put it in the uncomfortable position of having to choose between two important constituencies. Some saw Thursday's announcement as a chance to delay making that hard choice until after the upcoming presidential election. "This is a surprise to us and counter to our existing call that the approval was still likely and only the timing was in question," said Kevin Book, managing director of research at ClearView Energy Partners. "This does indeed suggest a political, not practical, choice to 'kick the can' into 2013." Pipeline supporters, including many in the business community, the construction trades, and nearly everyone in the oil industry, say the United States could use the 700,000 barrels a day the pipeline would carry. Many of the world's biggest oil companies, including ExxonMobil ( XOM , Fortune 500), Royal Dutch Shell ( RDSA ) and BP ( BP ), have been ramping up production from the oil sands and need a way to get it out. While oil sands crude might be dirtier than some other forms of oil, they say, at least it comes from Canada, where environmental and human rights rules are generally strict and enforced. Backers also said the pipeline would create 20,000 construction jobs in the short term and generate $5 billion in property tax revenue over the next century. "This decision is deeply disappointing and troubling," American Petroleum Institute President Jack Gerard said in a statement. "Whether it will help the president retain his job is unclear, but it will cost thousands of shovel-ready opportunities for American workers." But in highly visible protests over the last few weeks, critics had been picking apart the pipeline's promised benefits. The jobs number, they say, is actually closer to 5,000. One study from Cornell said the pipeline could actually cost jobs by hurting the development of alternative energy and allowing for the export of oil from the Midwest, driving up the cost of gasoline in that region. Opponents also questioned the validity of the State Department's approval process, noting that several lobbyists for the industry have close ties to the administration. In a letter to the State Department's inspector general last month, several lawmakers said they were uncomfortable with reports saying the firm hired by the State Department to conduct the environmental review for the pipeline also has a business relationship with TransCanada. The inspector general's office began a review of the approval process last week. 

Home prices

NEW YORK (CNNMoney) -- Home prices continued a winning streak in August, the fifth straight month of price gains, but remain lower on a year-over-year basis. A gauge of home prices featuring 20 major cities, the S&P/Case Shiller index, reported Tuesday that prices rose 0.2% in August but were still down 3.8% year over year. Print Comment "Even though the [year-over-year] rates are improving, national home prices are still below where they were a year ago," said David Blitzer, a spokesman for S&P. Overall, the market is treading water and there doesn't seem to be any reason to suspect that's going to change soon. "As long as the economy remains weak, foreclosures are still a problem and lending standards stay stringent, we're not going to see much movement in home prices," said Mike Larson, a real estate analyst for Weiss Research.

"You just haven't gotten yet the rocket fuel needed to send housing soaring again," he said. Among individual metro areas, Washington saw the biggest gain -- 1.6% in August. Detroit and Chicago were close behind at 1.4%. In the past 12 months, Washington prices have gone up 0.3%. In Detroit prices were up 2.4% since August 2010, more than any other area. The Atlanta metro area recorded the steepest decline, down 2.4% for the month. Year-over-year prices were off 6.3%. Minneapolis home prices recorded the worst 12-month drop of 8.5%. The home price report comes on the heels of changes in the Home Affordable Refinance Program (HARP) announced Monday by the Obama administration. The changes will enable many homeowners to refinance high-interest mortgages more easily, making their monthly payments more affordable. The plan should enable some to avoid default. Ed Mermelstein, a New York-based real estate attorney, broker and developer, doubts that the HARP changes will have much impact on home prices or sales. "The economy and jobs have to come back. That's what's going to help the housing market," he said. Larson pointed out that even if they work as planned, HARP's main focus is helping existing homeowners stay in their homes; it won't spur new sales. Newport said he thinks that housing market weakness will continue improving. How to rescue the housing market: foreclosures "The key reason is that more distressed homes are coming onto the market and will be selling," he said. "That tends to drag home prices down." Fiserv, which provides real estate financial analytics to industry, is projecting a further home price decline of 3.6% through the end of June 2012. If that forecast comes true, it would mean home prices will plumb a new, post-bubble bottom over the next nine months, down 34% from the mid-2006 peak. 

Bernanke doesn't get treated 'ugly' in Texas

Fed Chairman Ben Bernanke NEW YORK (CNNMoney) -- Take that Rick Perry! Ben Bernanke headed down to Texas to rally the troops Thursday, and didn't get treated so "ugly" after all. The Federal Reserve Chairman spoke to soldiers at Fort Bliss, offering up tips to improve their job prospects and personal finances. His speech -- along with a question-and-answer session -- came about three months after Perry, the Texas governor and a Republican presidential candidate, mildly threatened Bernanke and called him "almost treasonous." Print Comment "If this guy prints more money between now and the election, I dunno what y'all would do to him in Iowa, but we would treat him pretty ugly down in Texas," Perry said back in August. According to CNN's El Paso affiliate KFOX, Bernanke greeted about 250 soldiers before sunrise after they flew home from Iraq.

He was also given a tour of one of the base's training centers, which offers classes in financial planning. Bernanke urged soldiers to take advantage of any available training programs to boost their job skills and personal finance know-how, and upon leaving the military, to use the G.I. Bill to fund a college education. "While you are in the military, take advantage of training opportunities," Bernanke said in his prepared remarks. "Many specific skills learned in the military -- nursing and healthcare, mechanics, computer programming, police and security work -- transfer to civilian jobs." Bernanke's comments are part of a push in Washington to help America's military. Veterans from the recent wars in Afghanistan and Iraq have a 12.1% unemployment rate, well above the national 9% average. Overall, 240,000 Americans who served in the military from 2001 on are currently unemployed. 0:00 / 01:55 Bernanke's mixed outlook in 2 min Earlier this week, the Senate voted to take up a bill aimed at helping unemployed veterans. The bill gives employers tax credits of up to $5,600 for hiring those who have been unemployed longer than six months. It would also give employers a tax credit of up to $9,600 for hiring long-unemployed disabled veterans. Bernanke didn't delve into that topic as part of his speech Thursday, and also spoke very little of monetary policy, other than to explain to the soldiers what the Federal Reserve's role in the economy is. "Supporting job creation is half of our marching orders, so to speak; the other half is controlling inflation," he said, adding that while high unemployment remains a challenge, he at least expects inflation to remain low for the "foreseeable future." Bernanke chides Occupy Wall Street misconceptions Europe's debt crisis also remains a threat to U.S. economic growth, Bernanke said. "I don't think we'd be able to escape the consequences of a blow-up in Europe," he said. Bernanke has recently borne heated criticism from not just Perry but most of the Republican presidential candidates. Mitt Romney has said he would be "looking for somebody new" to run the Fed, while former House Speaker Newt Gingrich and businessman Herman Cain have pledged to fire Bernanke. Meanwhile, Texas Congressman Ron Paul has been saying for years he wants to dismantle the Fed altogether. On Thursday, a marine in the audience asked Bernanke to respond to those criticisms, urging him to explain what a world without the Fed would look like. "It's not a very realistic proposal," Bernanke said. "Essentially, every country in the world has a central bank." 

Senate passes jobs bill to help veterans

Sen. Jon Tester, a Montana Democrat, speaks to veterans and lawmakers about his jobs proposal. WASHINGTON (CNNMoney) -- Heading into Veterans Day, the Senate unanimously passed a bill to help unemployed veterans seeking jobs as well as federal contractors facing a new tax burden in 2013. The Senate voted 95-to-0 Thursday to pass the first and so far only piece of President Obama's jobs package to get out of the chamber. The House is expected to take up the bill and pass it next week.

Print Comment Lawmakers are touting the bill as a bipartisan jobs creator that is fully paid for and would even reduce federal deficits by $2 billion over the next decade, according to the Congressional Budget Office. "The bills won't solve our jobs crisis," said Senate Minority Leader Mitch McConnell on Thursday. "But this attempt at bipartisanship has been used to help get them over the finish line and represents our best shot at making progress on jobs in the economy." The bill gives employers tax credits of up to $5,600 for hiring veterans who have been unemployed longer than six months. It would also give employers a tax credit of up to $9,600 for hiring long-unemployed disabled veterans. The October unemployment rate for veterans who left the military after 2001 was 12.1%, leaving about 240,000 veterans out of work, according to the White House. The measure to help veterans is a small piece of President Obama's job package. "Let's work together to get this bill passed, because it's the least we can do for those whom we owe so much," said Sen. Jon Tester, a Montana Democrat and sponsor of the veterans' measure. Bernanke doesn't get treated 'ugly' in Texas The bill also expands an education and jobs retraining program for unemployed veterans. And it creates a new project that directs the Labor Department to figure out ways for veterans to use their specialized training to get licenses in different fields in the civilian work force. Republican Jim DeMint of South Carolina was the only lawmaker who voted against the amendment adding the veterans measure to the bill, saying he didn't think the government programs for veterans work. But, he voted in favor of then overall bill with the veteran tax credits on final passage. Maine Republican Olympia Snowe voted "present" on the bill. The Senate plans to pay for the tax credits by keeping special fees that the Department of Veterans Affairs charges veterans for guaranteeing mortgages at current levels. Those fees had been scheduled to get cheaper for veterans. By keeping the fees at current levels, the federal government can tap that revenue stream. The bill also repeals a George W. Bush-era tax accountability law that would have allowed the federal, state and local governments to withhold 3% of contractor pay, allowing those dollars to be applied as a credit toward federal income taxes. That law was supposed to take effect on Jan. 1, 2013. 0:00 / 1:30 Homeless vet starts small business Congress initially passed the withholding requirements back in 2006 to ensure that the government collected all taxes owed by contractors. Big business groups, including the U.S. Chamber of Commerce, have been pushing to repeal the measure. The House overwhelmingly passed that bill last month with a vote of 405-16. The cost of repealing the tax withholding measure is about $11 billion. Congress would pay for the repeal by changing a part of the new health care reforms. The government would redefine who is eligible for federal help under new health care reforms, making it more difficult for some to qualify for Medicaid or subsidized health care coverage. The bill raises the threshold level to qualify for government help by including nontaxable Social Security benefits, as well as the taxable portion, as income. The White House issued a statement on Thursday supporting the measure, saying it would "reduce unemployment and ensure that our veterans leave the military with the tools they need to succeed in the civilian workforce." 

IEA sees danger in rising oil, coal use

International Energy Agency says the world is embarking on oil and coal projects and will 'lock itself into an insecure, inefficient and high-carbon energy system.' NEW YORK (CNNMoney) -- The International Energy Agency warned Wednesday that the world faces serious dangers from global warming unless it radically alters its planned investments in new oil and coal facilities. Under current policies, oil use will rise 14% by 2035 and coal use will surge 65%, mostly from the developing world. Print Comment The resulting greenhouse gas emissions over the next 25 years will be equal to three-quarters of the total emissions from the previous 110 years combined, and will cause a 3.5-degree Celsius (6.3 Fahrenheit) rise in global temperatures, well above the 2% increase set as a target by global leaders. "Without a bold change of policy direction, the world will lock itself into an insecure, inefficient and high-carbon energy system," IEA said in its annual World Energy Outlook. "Governments need to introduce stronger measures to drive investment in efficient and low-carbon technologies." It's a particularly strong warning from an agency whose main task is to coordinate global stockpiles of oil in developed countries, in case there's a supply disruption.

It also comes at a pertinent time for the energy debate in the United States. Critics of the proposed $7 billion Keystone pipeline expansion, slated to carry oil from Canada's oil sands to ports on the U.S. Gulf Coast, are using this argument as a key point in their opposition to the project. IEA also said that unless countries in the Middle East and North Africa invest $100 billion a year over the next five years in new oil infrastructure, the world could see oil prices jump to over $150 a barrel "in the near term." Investments of that magnitude will be a challenge for many of those countries, especially in light of the disruptions and social spending promises made during the Arab Spring uprisings. Keystone oil sands pipeline construction in doubt The report noted that while oil use is expected to jump 14%, actual cars on the road are expected to double -- again, mostly from demand in the developing world. Those new cars are expected to be more efficient than today's models helping to curtail the rise in oil consumption. Still, the world will need to produce 99 million barrels of oil a day to meet that new demand, up from 87 million currently. IEA says that 90% of that new supply will have to come from Middle East and North African countries. Underestimating technology's impact: Forecasting agencies like the IEA are often criticized by those in the industry for making conservative predictions and underplaying the role of technology. Indeed, many in the oil industry argue that new technologies enabling the development of shale oil, as well as deepwater drilling and other enhanced technologies, will allow for much greater oil production from places like Canada, Brazil and the United States. Similarly, those in the solar industry predict their panels will be cost competitive with coal in the next few years, facilitating a massive shift away from fossil fuels and towards renewable energy. But IEA does not see things that way. The agency is calling for renewables to make up just 18% of world energy supply by 2035, up from 13% today. 0:00 / 2:15 Small town, big oil: The heart of a boom But it's clear IEA wants to see more renewables. Although the agency didn't call for specific policies, typically "stronger measures to drive investment" would include things that make fossil fuels more expensive so renewables can compete, or mandates to use more renewable power. Making fossil fuels more expensive could be done by enacting a tax on carbon emissions or laws limiting their release. Europe has such policies, as does Japan and, more recently, Australia. Even China and India have enacted strong mandates for renewable energy use. Land a job in a North Dakota boomtown Policies in the United States to drive investments in renewables include a 30% tax credit for wind and solar projects and a mandate requiring greater fuel efficiency from vehicles and the use of more biofuel. The Obama administration, along with some Democrats in congress, has been trying to pass laws limiting the amount of carbon that can be emitted and a mandate requiring utilities to buy a certain percentage of their power from renewable sources like wind and solar. The idea is that by providing a market for renewables, the price will come down as they reach economies of scale. But those efforts have been foiled by Republicans and some Democrats in Congress, who argue it would raise energy prices too much and that the technologies will be adopted when they can compete in an open market.  

Keystone oil sands pipeline construction in doubt

Concerns over the water and air could derail the $7 billion Keystone pipeline project that promises thousands of jobs, millions of barrels of oil and billions in tax revenue. NEW YORK (CNNMoney) -- Twenty thousand construction jobs. $5 billion in tax revenue. 700,000 barrels of additional oil a day. All these things are now in doubt as opposition mounts to the expansion of the Keystone pipeline, a 1,700-mile long conduit that would carry crude from Canada's Alberta oil sands region to the U.S.

Gulf Coast. Print Comment Just a few weeks ago analysts thought the jobs and economic benefits would easily outweigh environmental concerns and push the Obama administration to approve the $7 billion project. But now Nebraska is balking at the pipeline's route, and rumblings of discontent are being heard from South Dakota as well. The public pressure is being turned up too. Protestors, concerned about green house gas emissions associated with Canada's oil sands and doubtful of its promised benefits, have been rallying against the project all summer. On Sunday, thousands joined hands and literally encircled the White House. "Once thought to be a shoo-in, a near-term presidential approval of the pipeline looks less secure as opposition and headlines mount," Whitney Stanco, an energy analyst at the Washington Research Group, wrote in a note Monday. "We continue to believe the odds favor approval, but an extended delay is looking more and more possible." Last week the state of Nebraska, through which the pipeline would pass, convened a special legislation to address the issue. Keystone pipeline: Why the oil sands conduit will get built This week several bills are expected out of the state legislature. Those bills could require stricter construction standards where the pipeline would pass close to water resources. They could also attempt to alter the course of the pipeline, directing it away from the Sand Hills region. The Sand Hills sit atop the massive Ogallala Aquifer, sacred to farming interests in the state. "Nebraskans are concerned, and so am I, on why would you put a pipeline over the Ogallala Aquifer and risk an oil spill or leak," Nebraska Gov. Dave Heineman, a Republican, recently told a local paper. The concern from Nebraska is causing analysts to rethink their position on the pipeline. "Risks for Keystone XL at the US federal level remain low, but are rising at the state level in Nebraska," Robert Johnston, director of energy and natural resources at the political risk consultancy Eurasia Group wrote in a recent research note. TransCanada ( TRP ), the company that wants to build the pipeline, maintains that pipelines are the safest way to carry crude oil. 0:00 / 2:15 Small town, big oil: The heart of a boom The company has already agreed to install extra protections around the pipeline when it passes near water resources, and has put up a multi-million dollar bond to cover expenses should a spill occur. But TransCanda is opposed to any rerouting of the pipeline, saying it would take years to obtain the new permits and cost million of dollars. Last week the company posted a detailed legal analysis saying the federal government has sole authority over the pipeline's route now, and any attempt by the states to change it would be unconstitutional. "If individual states could make these decisions, the decisions would be based on the limited interests of those states, potentially defeating broader national interests," the analysis said. Because the pipeline crosses international borders its approval rests with the State Department. Pipeline critics were heartened last week when President Obama indicated he'd take a direct role in the approval process. Obama had previously maintained a low profile on the issue. Critics say building the pipeline not only risks spills but would lock the U.S. into dependency on a particularly dirty form of oil. Oil sands are just that -- oil mixed with sand. To get a useful type of crude, heat is used to separate the oil from the sand. The process results in anywhere from 5% to 30% more greenhouse gas emissions than conventional oil would generate. There are additional concerns over the effects on the land. Oil sands are often mined like coal, in huge open pits that destroy the forest and can contaminate the nearby rivers. The companies that operate in the region, including the world's largest oil companies like ExxonMobil ( XOM , Fortune 500), Royal Dutch Shell ( RDSA ) and BP ( BP ), have gotten better at mitigating the impacts, but concerns remain. Pipeline opponents also allege the approval process at the Sate Department has been tainted by lobbyists for TransCanada that have close ties to the administration. On Monday the State Department's inspector general's office said it is conducting a review of the process. Critics also dispute the benefits the pipeline would bring, pointing to a study from Cornell that said the pipeline could actually cost jobs by hurting the development of alternative energy and allowing for the export of oil from the Midwest and driving up the cost of gasoline in that region.  

Obama budget aide doesn't see shutdown

Budget chief Jack Lew says he's optimistic Congress will say no to federal shutdowns. WASHINGTON (CNNMoney) -- White House budget director Jacob Lew said Thursday he's optimistic that Congress will avoid any more threats of federal shutdowns later this month over a 2012 budget. "After living through April and July, any reasonable person would have to say there's risk" of a shutdown crisis, said Lew, director of the White House Office of Management and Budget in a forum sponsored by Politico. "(But) I generally don't believe that Congress wants to be in that kind of a showdown. I'm optimistic they'll work through these issues and make the right choice." Print Comment Congress came the closest to shutting down federal government due to political gridlock over passing a stop-gap budget measure in April, and then again in August over a measure to give the government more room to borrow to keep paying bills.

Lew said those episodes taught Congress that Americans want both parties to work together. "The American people have told Congress it's unacceptable," Lew said. But he tempered his predictions with a warning to Republicans against using the budget to debate "ideology." Lew said that the White House opposes any effort to use the budget bill to debate repeals of current laws such as financial or health care reform. He pointed to a letter he sent lawmakers in October that said if the president gets a bill that "undermines critical domestic priorities or national security," he will veto the bill. "We don't take those words lightly," Lew said. 0:00 / 1:48 Who is getting squeezed by the debt deal? The federal government is running on a stop-gap budget that expires Nov. 18, while Congress works on the 2012 budget, which officially started Oct. 1. Most congressional veterans expect Congress will pass another stop-gap measure to give them more time to get a 2012 budget in place. The Senate made progress on that front Tuesday, when it passed a smaller $182 billion budget package that funds housing, transportation, NASA, FBI as well as the departments of Agriculture and Commerce. That bill is among a dozen that need to be passed by both chambers. Lawmakers need to make some smaller cuts from this year's budget while bigger, longer-term cuts are being debated by a so-called super committee. That committee has until Nov. 23 to make at least $1.2 trillion in cuts to annual deficits. 

Fed perks up (a bit) on economy

0:00 / 01:55 Bernanke's mixed outlook in 2 min NEW YORK (CNNMoney) -- The Federal Reserve issued a slightly better outlook on the economy Wednesday, but cut its economic growth forecast for the year overall. Following a two-day policy meeting, the central bank voted 9-to-1 to make no changes to the Fed's ongoing stimulus program, and maintain its pledge to keep interest rates at record lows "at least through mid-2013." The Fed has held rates near zero since December 2008. Print Comment "Economic growth strengthened somewhat in the third quarter, reflecting in part a reversal of the temporary factors that had weighed on growth earlier in the year," the Fed said in its statement. Because of weak growth in the first half of the year, the central bank chopped its forecasts for 2011 as a whole. The Fed expects the country's gross domestic product to grow between 1.6% and 1.7% for the year, down from its earlier estimates of 2.7% to 2.9%.

Meanwhile, the Fed expects the unemployment rate to stay around its current level of 9.1% through the end of the year, and not fall below 8% until at least 2013. The Fed also noted in its statement that household spending has increased at a faster pace recently, as business investment has also expanded. The housing market continues to be a drag though, and risks to economic growth, including strains in global financial markets, still persist. Read the Fed statement At its last meeting in September, the Fed launched a program known as Operation Twist, swapping $400 billion in short-term bonds for longer term securities. The program was intended to bring down long-term interest rates, making it cheaper for businesses, consumers and potential homebuyers to secure cheap loans. By coupling that plan with investments in mortgage-backed securities, the Fed has also been targeting the housing market specifically, by trying to bring down record-low mortgage rates even further and giving homeowners an incentive to refinance their existing mortgages. The effects of those ongoing programs have yet to be fully realized, but already some Federal Reserve officials have been making a case for more stimulus. Last month, Fed Governor Daniel Tarullo and New York Fed President William Dudley both called for more efforts to prop up the housing market. Janet Yellen, second in command to Fed chairman Ben Bernanke, said another round of asset purchases could be necessary to boost U.S. economic growth. And Chicago Fed President Charles Evans has been pushing for the central bank to do more to fix the jobs crisis. While the Fed decided not to act on any of those ideas in their latest meeting, all that campaigning has outsiders wondering if the central bank could be preparing to act at its upcoming meeting in December. Evans dissented against the Fed's decision Wednesday, because he would have preferred the central bank take additional action. He was the only Fed member to formally dissent. Speaking to reporters Wednesday, Bernanke acknowledged that the Fed has discussed various options for further stimulus, but he fell short of endorsing any particular plan. "We are prepared to take further action," he said. "We have the tools to do more, if that's appropriate." One example Bernanke gave was the "communications tool," which refers to the Fed attempting to influence the economy merely by being more transparent about its targets for inflation or economic growth. But Bernanke said the committee had not reached a decision on such a policy yet. Bernanke also addressed the Occupy Wall Street protests, which in many parts of the country have included backlash against the Fed. "I fully sympathize with the notion that the economy is not performing as we would like it to be," he said. But Bernanke pushed back against the idea that the Fed is part of the problem. "I think that the concerns about the Fed are based on misconceptions," he said. "Certainly, we are doing our part to try to create more jobs and create more opportunities in America." 

GOP and taxes: Mixed message

A lot of work but not a lot of time left: Debt committee leaders Jeb Hensarling and Patty Murray and member Jon Kyl. NEW YORK (CNNMoney) -- Republicans on Capitol Hill gave conflicting messages to the debt committee this week. Yes, we will accept increases in tax revenue as part of a debt reduction plan. Print Comment Um, no, we won't. Yes: On Wednesday, 40 House Republicans -- along with 60 Democrats -- signed a letter urging the committee to "go big" by crafting a $4 trillion deficit reduction plan that includes spending cuts and tax revenue.

A day later, House Speaker John Boehner, who has publicly told the so-called super committee that tax increases should be "off the table," nevertheless said he appreciated the signers' efforts to deal with the debt problem. And he seemed to dismiss Grover Norquist, calling him "a random person in America" -- even though Norquist created the anti-tax pledge signed by virtually every sitting Republican lawmaker, including Boehner. No: In the same breath, Boehner reiterated that Republicans are "opposed to tax hikes because we believe that tax hikes will hurt our economy and put Americans out of work." Also on Thursday, 33 Republican senators sent a letter to the super committee, asking that anything the panel proposes include "comprehensive tax reform that lowers rates and promotes economic growth, with no net tax increase." So which is it? The House letter and some of Boehner's remarks seemed to open the door to a super committee deal that Democrats could sign on to. And the Senate letter seemed to shut that door. But longtime observers of the Washington budget game aren't so sure the GOP letter signals that. Rather, they say, it's more a statement of preference than an absolutist demand that revenue increases are out of the question. The letter says "we ask" not "we won't vote for any deal unless," said Joe Minarik, a former chief economist of the House Budget Committee and the White House budget office. Indeed, it's more like "they're saying, 'This is what we'd like but it's not necessarily the only thing we can accept,' " said Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget. (Watch: Debt committee under pressure) What's more, the letter's message isn't necessarily incompatible with a go-big strategy like the kind some of the signers -- notably Sens. Tom Coburn, Mike Crapo and Saxby Chambliss -- have publicly supported in the past. That's because they believe pro-growth tax reform can generate an increase in tax revenue, as can the elimination of tax breaks such as lobbyist-won loopholes for special interests. And that increased revenue can be used to pay for lower tax rates. Because if anything is crystal clear about the GOP position on taxes these days, it's that raising tax rates is a no-can-do. 

G20 agree to 'action plan' for global economy

World's top economic leaders stand together for a 'family portrait' at the G20 summit in Cannes. CANNES, France (CNNMoney) -- After a summit dominated by concerns about Europe, the world's most powerful political leaders produced a two-page "action plan" for the global economy that builds largely on existing policies previously stated goals. The Group of 20 Summit in Cannes, France, ended on a rainy Friday with broad promises from leaders to work together on economic challenges that must be addressed in different ways by different countries. Print Comment In their official communiqué, the G20 leaders welcomed the plan European leaders agreed on last month to address the debt crisis in the eurozone. They also praised Italy for agreeing to have the International Monetary Fund oversee the nation's progress on fiscal reforms.

But the official statement made only passing mention of Greece, which has dominated behind-the-scenes talks here over the last few days. Greece caused a stir before the summit even started by announcing a controversial referendum, only to reverse course a few days later. The government of Prime Minister George Papandreou faces a confidence vote Friday. President Obama acknowledged the political drama in Greece, but sounded optimistic about the ability of European leaders to get the crisis under control. "I think that there are going to be some ups and downs along the way," he said. "But I am confident that the key players in Europe -- the European political leadership -- understand how much of a stake they have in making sure this crisis is resolved." Italian bonds at 'scary' levels Italy has also been the source of much hand-wringing here. The nation has seen its borrowing costs rise to unaffordable levels recently amid concerns in the global financial markets about the government's ability to get out of debt. The G20 urged "rapid elaboration and implementation" of the so-called comprehensive plan to address the debt and banking crisis threatening the euro currency and global economy. "We welcome the euro area's determination to bring its full resources and entire institutional capacity to bear in restoring confidence and financial stability, and in ensuring the proper functioning of money and financial markets," the communiqué states. European leaders were expected to unveil details of the plan, agreed to after an all-night meeting that ended Oct. 27, at this week's summit. But key aspects of the agreement remain unresolved and there are concerns about policymakers' ability to follow through. Europe: So many ways for things to go wrong The G20 also pledged to ensure that the IMF has sufficient resources to support economies that get into financial trouble. U.S. officials have repeatedly said that the IMF has sufficient resources to achieve its objectives. But the increasing threat of a government default in Europe has raised calls to beef up its capacity. The leaders tasked their finance ministers to explore "various options" to increase the fund's flexibility, including bilateral contributions, the use of Special Drawing Rights -- a currency like instrument administered by the IMF -- and creation of a trust fund for voluntary contributions. Meanwhile, the action plan is made up of broad policy prescriptions for the global economy, many of which have already been discussed by G20 members. It starts with Europe implementing the Oct. 27 plan, including debt relief for Greece, new capital requirements for banks and a stronger "firewall" to protect vulnerable euro area economies. 0:00 / 2:20 Should China bail out Europe? To ensure a "balanced" global recovery, the G20 called for advanced economies to continue with "appropriate" fiscal consolidation programs. The United States agreed to support its economy through government investments, tax reforms and job creation programs. At the same time, the U.S. government will continue to take steps to cut deficits and reduce debt under its "medium term fiscal consolidation" program. G20 nations that have large budget surpluses, such as China, "will take steps to support domestic demand," according to the action plan. China also agreed to move towards "gradual convertibility" of its currency, the yuan, and will slow the rate at which it accumulates reserves.  

Many companies pay no income tax

NEW YORK (CNNMoney) -- The corporate tax rate is 35%. But an examination of 280 of the nation's largest corporations suggests that many aren't paying anything close to that. The real tax rate paid by a slew of major corporations averages closer to 18.5%, according to a study released Thursday by two liberal tax research groups. Print Comment The report issued by Citizens for Tax Justice and the Institute on Taxation and Economic Policy paints the corporate tax code as wildly inefficient, filled with loopholes and subject to the influence of lobbyists who carve out special provisions for the companies they represent. The study looked at 280 companies in the Fortune 500 that were profitable for all three years between 2008 and 2010.

The results: 111 companies paid effective tax rates of less than 17.5% over the three-year period; 98 paid a rate between 17.5% and 30%; and 71 paid more than 30%. The average rate? 18.5%. Some companies paid zero. And 30 actually owed less than nothing in income taxes over the three years. How does that happen? At the root of the problem is a system of inverted incentives that encourages corporations to lobby for special tax breaks -- and politicians to insert them into the tax code. Corporations pay lobbyists. Lobbyists convince lawmakers to add tax breaks. Lawmakers modify the tax code. 0:00 / 5:10 Southwest CEO to Obama: Don't tax us more It wasn't always like this. The corporate tax code was cleaned of special tax breaks during the Reagan administration. The clean slate didn't last long, and over time, special provisions have been added back in. NASCAR racetrack owners are allowed to write off the costs of their racetracks. There's the sweet deal for companies that make Puerto Rican rum. Some of the biggest breaks go to companies that are allowed to write off investments in equipment more quickly than they actually depreciate. The American tax machine And certain companies enjoy incentives geared specifically at their businesses. The oil and gas industry, for example, is allowed to write off some drilling and exploration expenses. All the breaks add up -- sometimes eliminating a company's tax burden altogether. Other companies reported so many "excess tax breaks" that their tax burden went "negative," the study said. According to the study, utility Pepco Holdings and conglomerate General Electric have the highest negative income tax rates. Pepco's profits totaled $882 million over the three-year period, while the company had a negative tax rate of 57.6%. GE earned $10.5 billion, with a negative rate of 45.3%, according to the study. Pepco ( POM , Fortune 500) said Thursday that it always operates within the law, and that the IRS audits every income tax return filed by the company. "Pepco Holdings pays all its required taxes, including but not limited to income, sales, use, property, and gross receipts taxes, in all the taxing jurisdictions within which it operates," the company said in a statement. The truth about GE's tax bill GE ( GE , Fortune 500), which runs an extremely complicated multi-national operation, took issue with the study, calling it "inaccurate and distorted." "GE paid billions of dollars in taxes in the United States over the last decade, and we expect our overall tax rate will be approximately 30% in 2011," the company said in a statement. "We believe the U.S. tax system needs to be reformed to close all loopholes, to lower the corporate rate and to provide a territorial system like every other major country in the world." GE is not alone in calling for reform. Most lawmakers acknowledge the system is broken. President Obama called for corporate tax reform in his State of the Union address and the concept has support among lawmakers on both sides of the aisle. 0:00 / 2:58 Why tax repatriation is a bad idea The idea of reform is to lower the corporate tax rate while greatly scaling back tax breaks, loopholes and other provisions of the tax code that allow most corporate income to avoid taxation. Despite the general consensus that something must be done, lawmakers are not likely to tackle the issue anytime soon. It's possible that the congressional super committee, now trying to find a way to cut the deficit, will make reform recommendations. But don't count on too much action. The political atmosphere on Capitol Hill has prevented movement on many fiscal and tax issues in recent months. Daniel Shaviro, a tax professor at New York University School of Law, said he doesn't anticipate big changes in the corporate tax code, at least in the near term. "There is widespread sympathy for lowering the corporate rates," Shaviro said. "But I I tend to doubt it happens anytime soon."  

Occupy Oakland's general strike call: 'Shut down the 1%'

The Occupy Wall Street movement in Oakland, Calif., plans a citywide general strike Wednesday. NEW YORK (CNNMoney) -- The Occupy Wall Street movement is about to enter new territory: The strike zone. By a vote of 1,484 to 46, the General Assembly of Occupy Oakland voted last week to call a citywide general strike for Wednesday. Print Comment "[W]e invite all students to walk out of school. Instead of workers going to work and students going to school, the people will converge on downtown Oakland to shut down the city," the group's manifesto read.

"We liberate Oakland and shut down the 1%." After striking, demonstrators plan to converge Wednesday evening on Oakland's port, one of the country's largest and the city's most visible symbol of commerce. (Read: Occupy Wall Street applies for trademark) Occupy Oakland's call to strike follows a crackdown on protesters last Tuesday. Police loosed smoke grenades and rubber bullets, and Iraq war veteran Scott Olsen suffered a fractured skull after being struck by what protesters say was a tear gas canister. "Tens of thousands" will turn out for Wednesday's general strike, Occupy Oakland organizer Tim Simons predicted. Top 1% are getting even richer Virtually all prominent local labor unions have issued statements of support, Simons said, and "we have confirmations of student walkouts throughout the city." "We even know of some motorcycle gangs that will participate." Though a mix of contracts and laws forbid major unions from officially joining the strike, determined rank-and-file will probably take part through vacation days, sick days or other furloughs, union officials speculated. "We're calling it a day of action, so we're encouraging people to participate," said Roxanne Sanchez, the president of SEIU 1021, one of the largest unions in the area. Should any employer in Oakland punish an employee for striking, they'll hear from Occupy Oakland. The group's Strike Assembly has voted to "picket and/or occupy" any companies that sanction employees for participating in the strike. 0:00 / 2:29 Occupy Wall Street's money man Strikes by individual unions or staffs are familiar, though uncommon, in the United States, but general strikes are rare. The last true general strike occurred in 1946, according to Georgetown University labor historian Joe McCartin, and also occurred in Oakland -- a fact not lost on Occupy Oakland. About 100,000 workers walked off the job in solidarity with employees of two department stores, whose bid to unionize had been put down. The Oakland strike call shows the "historic levels of anger and frustration among lots of people," McCartin said. Various Occupy satellites will hold solidarity actions to coincide with Oakland's strike. Occupy Philadelphia is planning a 99-minute strike from noon to 1:39 p.m. on Wednesday, the duration a play on demonstrators chants that they represent "the 99%." Occupy Wall Street ... mansions Occupy Oakland organizers say their strike is as much about trying to take the Occupy movement to the next level as responding to recent police overzealousness. The Occupy movement has "sort of reached the limits of only sitting in squares and parks and we need to start showing the real potential of these people who are mobilizing now," Simons said. Other Occupy satellites have reached a similar conclusion. In Cincinnati, Occupy-ers have mulled striking to draw attention to their dissatisfaction with Cincinnati-headquartered bank Fifth Third, spokeswoman Kristin Brand said. While the general strike is without recent precedent in America, it has been in vogue globally of late. General strikes over austerity measures have sporadically paralyzed sections of the Greek, Spanish and Italian economies this year. European general strikers have had significantly more practice than Occupy Oakland. "Those countries all have traditions of general strikes that are more lively and up to the recent time, whereas in the United States general strikes were always more rare," McCartin said. 

'Go big' advocates to debt committee: Don't wimp out

Budget experts (left to right) Erskine Bowles, Alan Simpson, Alice Rivlin and Pete Domenici urged the debt committee to lead. NEW YORK (CNNMoney) -- The congressional debt committee, three weeks from its deadline and reportedly deadlocked, got a polite earful on Tuesday from four of the most passionate proponents of a big, balanced and bipartisan deficit-reduction plan. Their key message: Step up and be leaders. Table partisan interests in favor of the country's interests to reduce the risk of a fiscal crisis. In other words, rein in the federal budget across the board, reform the tax code and make sure all but the most vulnerable share in the sacrifices required.

Print Comment And they each expressed caution that ideology and political considerations may scuttle the whole process. "I have great respect for each of you as individuals. But I'm worried you're going to fail, fail the country," said Erskine Bowles, who co-chaired President Obama's debt commission last year with Alan Simpson. If the committee is unable to come to agreement, people would start to assume that Congress can't govern and that the United States is on its way to becoming a second-rate power, Bowles said. Project Compromise: Time for Congress to do right The economic consequences would be grave as well, said Alice Rivlin, who co-chaired the Bipartisan Policy Center's Debt Reduction Task Force with Pete Domenici. "I think we could face a long period of stagnant growth," Rivlin warned. Domenici, a former Republican senator, made clear that if the committee fails because neither side could shed its partisan straitjackets, "you'll be equally complicit in bringing the country to the fiscal brink." Judging from some of the questions from both sides of the aisle, it wasn't entirely clear that the committee members were willing to shed their partisan proclivities just yet. A bipartisan majority of members on the Bowles-Simpson commission -- including 6 lawmakers -- voted for a $4 trillion debt reduction plan that included cuts to spending, containment of health care costs, and increases in tax revenue. The Rivlin-Domenici task force recommended a plan similar in structure, but with $6 trillion in debt reduction over 10 years and more upfront economic stimulus. The $4 trillion to $6 trillion range is what budget experts say is required to stop the country's debt from continuing to grow faster than the economy and to put it on a downward trajectory over time. That's well above the $1.2 trillion minimum target set for the 12-member congressional "super" committee, as it's known. If the members can't agree on at least that much, a series of automatic spending cuts -- primarily in defense and nondefense discretionary spending -- would be triggered in 2013. Those automatic spending cuts, of course, could be repealed by Congress sometime in 2012 before they take effect -- an outcome some observers think is a real possibility. Taxes and debt: Left and right dare to agree Bowles and Simpson laid out the six principles they believe the committee should follow in putting together any package: Don't disrupt the fragile economic recovery Protect the disadvantaged Don't jeopardize the country's security Protect investments in education, infrastructure and research Reform the tax code Cut spending in all areas of the federal budget If the committee cannot propose detailed tax and entitlement reform before its Nov. 23 deadline, the debt committee should recommend some specific measures and agree on the broad parameters for tax and entitlement reform, the witnesses said. "A two-stage approach would maximize the prospects for reaching agreement on at least $1.2 trillion in savings ... and putting in place a process to reduce the deficit by at least $4 trillion over the next ten years," Bowles and Simpson said in written testimony.