ProPublica Archives - Shopfloor

Hydrofracturing the Country’s Way Toward Energy Security

By | Energy, General, Regulations | No Comments

When Daniel Yergin writes about historic development in energy production, one pays attention. In today’s Wall Street Journal, joined by his colleague Robert Ineson, Yergin examines the rise of natural gas production in the United States made possible by technological advances that open up vast shale deposits to exploitation. From “America’s Natural Gas Revolution“:

The biggest energy innovation of the decade is natural gas—more specifically what is called “unconventional” natural gas. Some call it a revolution.

Yet the natural gas revolution has unfolded with no great fanfare, no grand opening ceremony, no ribbon cutting. It just crept up. In 1990, unconventional gas—from shales, coal-bed methane and so-called “tight” formations—was about 10% of total U.S. production. Today it is around 40%, and growing fast, with shale gas by far the biggest part.

The potential of this “shale gale” only really became clear around 2007. In Washington, D.C., the discovery has come later—only in the last few months.

Making this development possible has been hydrofracturing, or fraccing, the technique of injecting pressurized liquids into the strata to fracture the shale and free the gas. (See Shopfloor.org’s previous posts on the topic.) The potential of this gas development is especially important economically to northeastern states — and industry — because the Marcellus Shale is close to markets in New York, Pennsylvania and other heavy energy consuming areas.

Earlier in the decade, natural gas prices soared as demand grew, spiking as Hurricane Katrina disrupted supplies. Price and price volatility were big factors in driving natural-gas consuming industries like fertilizer and chemical manufacturing overseas, but now…well, there’s reason for optimism.

Except, as the authors note:

[Industrial] users and the utilities with their long investment horizons—both of which have been whipsawed by recurrent cycles of shortage and surplus in natural gas over several decades—are inherently skeptical and will require further confirmation of a sustained shale gale before committing.

Skepticism also arises because of the growing environmentalist/NIMBY alliance dedicated to regulating hydrofraccing into submission, with the activist journalism outfit, ProPublica.org, serving as the movement’s house organ. States now regulate this aspect of drilling, and the regulators stand by the quality and safety of their oversight. (See the Interstate Oil and Gas Compact Commission for details.)

But federal regulation is always superior to state regulation, right? That at least is the theory of sponsors of bills — H.R. 2766 and S.1215 — to bring hydrofraccing under the Clean Water Act authority, even though as Yergin and Ineson note, shale strata lie much, much deeper than watersheds. Today, the predictable New York Times adds its support for the bills in an editorial, “The Halliburton Loophole.”

State regulation is not a “loophole,” and even invoking the bugaboo of Halliburton does not make it one.

History tells us the real goal, at least for the environmentalists, behind legislation to impose a Clean Water Act regime over hydrofracturing is project-halting litigation. So you can understand industry’s skepticism.


Energy Policy, Refusing to Limit Opportunity

By | Energy, General, Media Relations | One Comment

Following up on yesterday’s Senate EPW hearing on energy policy and the states, where North Dakota Gov. John Hoeven called for a comprehensive national energy strategy (see post), the good people at Energy in Depth pass on an exchange the governor had with Sen. Jim Inhofe (R-OK):

Key Excerpts From Yesterday’s U.S. Senate Environment and Public Works Hearing
Dialogue starts at 101:50.
Click HERE to view.

U.S. Sen. Jim Inhofe (R-OK):  “Governor Hoeven, the thing I was going to bring up is there’s a lot of discussion, when you talk about your offset capabilities there, and what you’re doing, that’s great. We’re doing somewhat the same thing, although most of ours is marginal production. But there is a, I’d suggest to you, the use of hydraulic fracturing is necessary in your state to be able to explore, to retrieve all these oil capabilities.”

Gov. John Hoeven (R-ND):  “It’s absolutely vital. You know, you mention some of these new formations. They are not, uh, the oil isn’t connected. You’ve got to go underground. And you’re talking two miles underground. And make a fracture in order to get the oil to flow. That’s vitally important.”

U.S. Sen. Jim Inhofe (R-OK):  “I wanted to get that into the record, because there are some efforts to do away with hydraulic fracturing, and it would be devastating.”

Just so. Energy in Depth has been a strong voice defending hydrofracturing technology, in which pressurized water is pumped in subterranean strata to make the oil or natural gas accessible via drilling. Without hydrofrac, development of the Bakken Formation oil as well as our vast natural gas resources in Texas (Barnett Shale) and Pennsylvania/New York/Ohio (Marcellus Shale) would be prohibitively expensive.

The activist group, ProPublica, has been leading a bizarre campaign against the widely accepted technology, and by offering its agenda-driven reporting for free has been successful in getting newspapers to publish the articles. Apparently if it’s gratis, editing is optional.

This is a telling observation from an Energy in Depth rebuttal, which explains why we refer to ProPublica as an activist outlet, not a journalistic venture, “Separating Fiction from Invention in ProPublica’s Latest Anti-HF Attack Piece“:

Earlier this week, ProPublica author Abrahm Lustgarten released the latest installment in his series of advocacy pieces attacking the commonly used energy technology known as hydraulic fracturing. Instead of simply running on the ProPublica blog and website, however, the article was co-published with Politico and appeared in the paper’s news section (a letter to the editor from Energy In Depth policy director Lee Fuller will appear in the paper this Tuesday).

It wasn’t the first time that a mainstream news outlet provided ProPublica with a platform for this kind of product – although, for papers such as the Pittsburgh Post-Gazette, the determination has been made that ProPublica articles, when run, are more appropriately filed on its “opinion/perspectives” page than as part of its straight-news reporting.

Prior to its release, Energy In Depth spoke at length with Mr. Lustgarten about the direction of the (presumably already written) piece and the myriad mistakes he was making in issuing a blanket indictment of recent government and third-party reports finding that EPA regulation of hydraulic fracturing would cost Americans jobs, revenues and future security.  

Regrettably, none of those explanations made it into his final piece.

 And regrettably, ProPublica appears to be a model for future journalistic ventures.

As previously noted, this blogger once worked for Gov. John Hoeven. But it’s been eight years now.

The ProPublica Precedent

By | Media Relations | No Comments

Noel Sheppard of Newsbusters.org comments on today’s Washington Post/ProPublica joint reporting proejct we wrote about here.  In his post, “WaPo Collaborates on Front Page Piece With Far-left ProPublica,” he makes a point we should have noted, as well, that the story itself — “As Crisis Loomed, Geithner Pressed But Fell Short” — an examination of Geithner’s time at the New York Fed, seems solid.

We followed the reporting of ProPublica’s Jeff Gerth on Chinese espionage when he was at the New York Times and thought it important journalism.  But, as Sheppard writes: “Of greater concern is the precedent established here, and the possibility that this far-left leaning outlet will get more of its work published by major mainstream entities like the Post.”

The Post’s disclosure also warrants a comment:

This article was reported jointly with ProPublica, an independent, non-profit newsroom that produces investigative journalism in the public interest. ProPublica is supported entirely by philanthropy and provides the articles it produces, free of charge, both through its own Web site and to leading news organizations.

Supported entirely by philanthropy sounds quite nice, but in a story about financial regulation, readers might like to know that the philanthropy is that of Herb and Marion Sandler, billionaire former owners of a California savings and loan. Golden West naturally had extensive dealings with its regulator, the Office of Thrift Supervision, including on such relevant issues as risk-based capital. You would never know that from the Post’s non-transparent disclosure.

Washington Post Farms Out Front Page to Journalist/Activists

By | Energy, Media Relations | 4 Comments

The Washington Post features a story on page one today, “As Crisis Loomed, Geithner Pressed But Fell Short” written by Robert O’Harrow Jr. and Jeff Gerth. The Post employs O’Harrow and Jeff Gerth, a former New York Times reporter, now works for ProPublica.

Pro-Publica is a non-profit journalism outfit founded with money from Herb Sandler, the former owner of Golden West, the California savings and loan he and his wife, Marion, sold to Wachovia in 2006. Herb Sandler now chairs Propublica. The Sandlers are also big backers of left-wing groups like ACORN and Moveon.org, as well as major contributors to the Democratic Party and candidates. (See this Pittsburgh Times column by Ed Lasky. UPDATE: And this follow-up column, “Will Herb & Marion Sandler pay a price?“)

ProPublica’s credo is this:

ProPublica is an independent, non-profit newsroom that produces investigative journalism in the public interest. Our work focuses exclusively on truly important stories, stories with “moral force.” We do this by producing journalism that shines a light on exploitation of the weak by the strong and on the failures of those with power to vindicate the trust placed in them.

That’s as clear of a statement of activist, left-liberal political sentiment as any we’ve seen, and yet The Washington Post finds it acceptable to partner with ProPublica in its journalism. It’s as if the Post were working on bylined stories with Public Citizen or OMBWatch or Americans for Prosperity or the NAM. Our organizations all have some pretty good researchers and writers, but come at news from a clear and honestly stated perspective. So what would be the difference?

ProPublica first caught our attention last year when it embarked on a series of stories attacking the natural gas industry for its use of hydraulic fracturing and horizontal drilling in development of the Marcellus Shale gas deposits in the Eastern United States. The stories were biased and one-sided, uniformly anti-business, and yet given great play by the Albany Times Union and public radio station and co-reporter, WNYC.  (See Shopfloor,”‘Public Interest’ Reports: Energy Development is Bad,” and “So That’s What ‘Public Interest’ Journalism Means“.) The stories showed a clear bias toward influencing public policy with the goal of limiting natural gas production.

Dave Kopel at the now-defunct Rocky Mountain News wrote on ProPublica’s further poor reporting of the natural gas issue (in the Denver Post) in his media column, “ProPublica’s shaky facts.” As Kopel observed at the VolokhWatch legal blog: “The one article which I examined in depth is not necessarily representative of the overall quality of ProPublica’s work. Nevertheless, the quality control failure on that article would make me very cautious about using ProPublica’s work, if I were a MSM editor. Before using the article, I would probably assign one of my own staffers to fact-check the ProPublica article.”

Seems like good advice, still. From “Disaster Preparedness Pays Off in North Dakota“: “But just hours earlier, the predicted height of the river’s crest had jumped, and Pitts received word that a nearby dyke looked vulnerable.” They’ve since fixed that misspelling, but the word “busses” remains.

ProPublica stories have appeared in many major media outlets — a Los Angeles Times package on psychiatric care, with the Chicago Tribune on a psychiatric hospital — and the Post’s Page One story demonstrates the trend is now-well established, that resources-strapped newspapers are happy to let other people do their reporting for them, especially when it’s free.

This week the news appeared, “Huffington Post to bankroll investigative reporting.” How soon before we see a front page Washington Post story with the byline, “By Robert O’Harrow Jr. and Sam Stein?” Stein’s a good reporter, so no problem.

Before Midnight, a Cap on Regulations

By | Manufacturing Institute, Regulations | No Comments

It appears that yesterday’s House Judiciary subcommittee hearing on midnight regs featured the usual political huffing and puffing, but it also elicited a sober and detailed analysis of regulatory practices in testimony from Veronique de Rugy, PhD, Senior Research Fellow at the Mercatus Center at George Mason University.

The phenomenon of midnight regulations — the rush of new rules issued in the last days and months of an administration — does exist, she argued, offering statistical evidence to prove the point. Furthermore, the additional number of consequential and costly rules undermines effective review by the Office of Information and Regulatory Analysis of OMB.

The solution?

Until now, the most common solutions to the midnight regulations problem have suggested steps that an incoming president can take to undo his predecessor’s last-minute actions. Our solution tries to mitigate the negative effects of midnight regulations by changing the incentives on the outgoing administration. We suggest placing a cap on the number of economically significant regulations OIRA can be expected to review during a given time period.

Doing so would help prevent OIRA oversight of new regulations from being diluted. A flexible cap would afford OIRA time and resources to carefully consider new rules while preserving Congress and the President’s prerogative to increase the cap by allocating more resources to OIRA. To the extent more resources are not allocated and end-of-term regulatory spikes are eliminated, a cap would also have the effect of addressing some of the other concerns raised by midnight regulations, including a lack of accountability and democratic legitimacy.

Sounds good in theory, but first it assumes that a White House would want to cede that authority. And we can’t imagine an activist agency couldn’t cirumvent such such a cap in any case. Agency staff could do all the preliminary work, collect all the data and arguments and commentary, try to issue the regulation and if blocked by OMB or OIRA, simply have their activist friends sue in the 9th Circuit. For example.

P.S. Gee, such interesting testimony and substantive proposals for reform. Guess ProPublica’s interest has waned now that the Bush Administration has left town.

Obama Administration Puts Pending Regulations on Hold

By | Regulations | No Comments

From the Washington Post’s Federal Eye blog, “Obama Halts New or Pending Bush Regulations,” news that Chief of Staff Rahm Emanuel has issued a memo (available here) announcing that President Barack Obama has ordered a freeze on new or proposed regulations at all government agencies and departments. The memo declares:

“…no proposed or final regulation should be sent to the Office of Federal Register for publication unless and until it has been reviewed and approved by a department or agency head appointed or designated by the President after noon on January 20, 2009, or in the case of the Department of Defense, the Secretary of Defense.”

The Post’s Ed O’Keefe also reports that the memo orders the “withdrawal of all final or proposed regulations not yet published by the Federal Register. Department and agency heads have also been asked to ‘consider extending for 60 days the effective date of regulations that have been published in the Federal Register but not yet taken effect’ unless they impact health, safety, environmental, financial, or national security matters — obviously now subject to the interpretation of Obama’s appointees.”

That a new Administration stops and reviews its predecessors’ regulations not yet in effect is an entirely reasonable and predictable act. Indeed, the Bush Administration moved deliberately on its final year’s regulatory agenda to put most of rules IN PLACE by the time it left office.

Norman Ornstein makes an interesting, related point in his NYT column Sunday about President Bush and his team’s handling of the transition to the Obama Administration, “Mr. Bush’s Gentlemanly Goodbye“:

To be sure, President Bush has signed some last-minute executive orders, especially in the environmental area, that will create headaches for Mr. Obama. But as a top Obama transition official told me, these were limited in number and scope and all done in the open.

We read those background comments from the Obama camp as undercutting frenzied efforts by activists like the Association for Justice and ProPublica to delegitimize the substance of Bush rulemaking  through a process attack against  “Midnight Regulations.”

In the end, if the Obama Administration challenges established rules, it will do so through the standard regulatory process based on the substance — not the process — of those rules. We’ll applaud or criticize those decisions based on the substance.

It’s Always Midnight at the Bottom of the Marianas Trench

By | Energy, Regulations | No Comments

There’s been much huffing on the activist left about “Midnight Regulations” being issued by the Bush Administration, that is, the supposedly last-minute surprises that the White House and agencies are springing on the public without adequate notice.

Groups like the American Association for Justice (trial lawyers), the Sierra Club (environmentalists), and ProPublica (activist, anti-business journalism) have all pounded the table against this circumvention of the regulatory and oversight process. But in most cases, these regulations have been in the works for many months if not years and have indeed followed standard practice, in line with OMB’s instructions to avoid the shortcuts and gaming that undermines the implementation of these rules.

What’s really going on here is an effort to delegitimatize the substance of the regulations, especially those that attempt to encourage energy production while maintaining public health and safety. These groups have all lost their arguments during the drafting and public comment period on the rules, so now they try a process attack against the outcome.

Why else haven’t we seen an outcry against President Bush’s announcement this week that is he is using his executive branch authority to declare national monuments in three areas of the Pacific Ocean – in total, the largest fully protected area in the world, 195,274 square miles worth? It’s an astonishingly far-reaching expansion of government control over vast regions, done not after a full policy debate in Congress but instead with a stroke of the president’s pen. Are any of the groups aggrieved over “midnight regulations” upset with this display of executive branch authority?

To its credit, at least OMB Watch acknowledges the President’s actions, trying to distinguish it from “midnight regulations” in a blog post, “Last-Minute Ocean Conservation from Bush“:

Bush’s conservation move comes not by agency regulations, but by powers granted to presidents under the Antiquities Act of 1906, according to the Post. Though the regulatory machine is shutting down, Bush has other ways of advancing his policies. Executive orders, proclamations, and the like — though easier for future presidents to undo — remain an option for Bush until his final minutes in office.

Well, then, shouldn’t OMB Watch and its allies among the anti-Bush-regulation crowd be as exercised about the new Marine Monuments as they are about the “midnight regs?”

Sure they should be, but they’re not, which tells us it’s not the midnight that offends them, it’s Bush keeping the clock.

Bakken Formation: Energy Production = Budget Surpluses

By | Economy, Energy | No Comments

That’s a connection worth considering: Energy production helps boost the economy, government tax revenues and employment in states like North Dakota, where the Bakken Formation and good ag prices have spread the wealth.

From The New York Times, “ A Placid North Dakota Asks, Recession? What Recession?”

While dozens of states, including neighboring ones, have desperately begun raising fees, firing workers, shuttering tourist attractions and even abolishing holiday displays to overcome gaping deficits, lawmakers this week in Bismarck, the capital, were contemplating what to do with a $1.2 billion budget surplus.

And as some states’ unemployment rates stretched perilously close to the double digits in the fall, North Dakota’s was 3.4 percent, among the lowest in the country.


North Dakota’s cheery circumstance — which economic analysts are quick to warn is showing clear signs that it, too, may be in jeopardy — can be explained by an odd collection of factors: a recent surge in oil production that catapulted the state to fifth-largest producer in the nation; a mostly strong year for farmers (agriculture is the state’s biggest business); and a conservative, steady, never-fancy culture that has nurtured fewer sudden booms of wealth like those seen elsewhere (“Our banks don’t do those goofy loans,” Mr. Theel said) and also fewer tumultuous slumps.

The increased oil production comes in great part from development of the Bakken Shale, a formation that has been accessed profitably through hydrofracturing and horizontal drilling.

Falling oil prices will obviously have an impact on the energy production, and farm commodity prices are also slumping. Manufacturing has also suffered its hits. Still, we bet there are a lot of states that would love to have North Dakota’s problems.

In related developments….


FARGO, N.D. — Federal Customs and Border Protection authorities are preparing to launch unmanned aircraft patrols from this state, the first time such monitoring will occur along the nation’s northern border.

A Predator B aircraft, delivered to Grand Forks on Saturday, will make runs along the northern edge of North Dakota using sensors that can provide video and detect heat and changes to landscape, Customs and Border Protection officials said.

Satirizing Congress, the President, George Soros and the Sandlers

By | Culture and Entertainment, Economy | 2 Comments

UPDATE (Monday, 11:20 p.m.): Saturday Night Live has pulled the video of the skit described below, and bloggers including Michelle Malkin suspect that the Sandlers and/or their partisan allies put pressure on NBC to kill the segment. Interesting speculation. What a worthy topic for investigative reporting, eh, ProPublica? (The jibe being that this supposed crack, disinterested journalistic venture is funded by Sandler and has yet just once mentioned this fellow in its reporting on the financial crisis or other groups he funds, like ACORN.)

And we’ll leave the video up as a silent rebuke …
It first seemed like just another belabored, overly long skit this weekend on Saturday Night Live, although certainly timely. Mockery of them all in a mock news conference: A dull President Bush, a hyperpartisan Speaker Pelosi, Rep. Barney Frank, deadbeat homebuyers and speculative creeps.

But then SNL made fun of Herb and Marion Sandler, the multi-multimillionaires who ran the Golden West thrift in California until selling it to Wachovia in 2006. These are big names in the savings and loan business and Democratic Party politics, but otherwise the superwealthy duo are obscure as obscure can be.

Last time we saw the Sandlers in the news they were funding another liberal, “investigative” anti-business media outfit, ProPublica. Good thing for those journalists the Sandlers sold why the selling was good.

In any case, we’re so impressed with SNL’s writers, to be aware of such detail in the world of high finance. Now, it wasn’t particularly funny, but still…

Or is there perhaps an Adam Sandler connection we don’t know about?

So That’s What ‘Public Interest’ Journalism Means

By | Energy, Media Relations | One Comment

Having studied up a little about the Marcellus Shale, hydraulic fracturing and natural gas regulation, we went back and read the original story in the Albany Times Union, page one, banner headline, written by Abrahm Lustgarten of the ProPublica non-profit, public interest, journalism venture: “Upstate New York’s looming natural gas nightmare.”

A couple of things jumped out.

First — Number of energy executives cited in the story: 0

No apparent effort at a balancing point of view, assurances or even platitudes from an industry that’s being condemned for threatening a “natural gas nightmare.”

Second — Clear identification of the critics: Not good.

In 2004 Theo Colborn, a scientist who specializes in the health effects of low-dose chemical exposure, began to investigate drilling fluids. She was spurred by the story of a Colorado resident who suspected her cancer was tied to water contamination from a nearby gas well.

Colborn collected shipping manifests that trucks must carry when they haul hazardous materials for oil and gas servicing companies. When an accident occurred, she took water and soil samples and tested them for contaminants.

But who is she?  The Markkula Center for Applied Ethics at Santa Clara University describes her:

Theo Colburn is senior scientist and director of the Wildlife and Contaminants project at the World Wildlife Fund. She started her career as a zoologist late in life, after she and her husband retired from a successful pharmacy business to raise sheep. She became alarmed by pollution in the Gunnison River near their ranch in Colorado. Her involvement in Western water issues led her to seek a master’s degree in ecology and a Ph.D. in zoology. Her pioneering work on the effects of synthetic chemicals on the endocrine system has led some to compare her to Rachel Carson, who warned the world about the dangers of DDT.

And, the recipient of the Rachel Carson Award! But the ProPublica story in the Times Union identifies this activist and prominent member of a major, international environmentalist group only as a scientist who specializes in the health effects of low-dose chemical exposure. The impression that’s left is of a disinterested scientist, not an anti-industry activist.

Third, adherance to basic journalistic accuracy and practices: Bad.  We offer this sample from a longer version of the ProPublica story — originally posted on the paper’s website but now only at ProPublica:

Hart, the Pennsylvania treatment plant executive, said the last time he talked with a DEC representative, the caller, whose name he couldn’t remember, displayed a general lack of understanding of water issues and didn’t have a clear grasp of waste water disposal alternatives.

“The caller, whose name he couldn’t remember.” As far as credible sourcing goes, that’s not. It’s laughable.

Here’s ProPublica’s credo: “ProPublica is an independent, non-profit newsroom that will produce investigative journalism in the public interest. Our work will focus exclusively on truly important stories, stories with ‘moral force.’ We will do this by producing journalism that shines a light on exploitation of the weak by the strong and on the failures of those with power to vindicate the trust placed in them.”

The “moral force” of any story is undermined by lousy, one-sided journalism.