Rhode Island Sues Big Oil

[Tom Kirkman + 8,860]

7 hours ago, Jan van Eck said:

The State itself purchases and consumes the product that they are suing over.  

^ this

[Cowpoke + 70]

Big Oil should just say sorry and move on. 

https://www.youtube.com/watch?v=D01NHPnLrVs

[Ecocharger + 1,477]

I hope that this is not just an attempt by lawyers to create more work for themselves.

In some jurisdictions, it is possible to countersue for punitive damages if the court is convinced that the lawsuit is clearly frivolous or baseless.

It is called "abuse of legal process" when someone files an absurd lawsuit which clearly has no merit or any chance of success.

 

[strudle + 5]

Just to be a Texan, I think the quickest solution is : for every oil company to simply stop selling their products in RI. After all, the State of Rhode Island is suing them for damages from their products, so Texas  logic says STOP SELLING  to prevent further damage!!!

[lawnman + 2]

I look forward to learning about the oil market, thank you.

[Jan van Eck + 7,558]

4 hours ago, Ecocharger said:

I hope that this is not just an attempt by lawyers to create more work for themselves.

In some jurisdictions, it is possible to countersue for punitive damages if the court is convinced that the lawsuit is clearly frivolous or baseless.

It is called "abuse of legal process" when someone files an absurd lawsuit which clearly has no merit or any chance of success.

 

But keep in mind that this suit was filed by the Attorney General of the State.  The possibility that it would ever be declared to be abuse of process within Rhode Island, by a RI Judge, is precisely zero. 

I see this as more of an elegant shakedown of the deep-pocketed oil industry, in an effort to raise more tax revenue from non-residents.  Rhode Island had one town that was so totally poor that it went into the bankruptcy courts  (and I think ended up selling itws fire trucks).  RI has these towns with Unfunded pension liabilities that swamp any possible ability to pay, so it is desperate to seek more cash - and that includes the capital, Providence.  To see how this looks, take a peek at the attached table:

Note that Providence has an unfunded pension liability running at 10 times its payroll.  So you need to pay for ten municipal payrolls with only one working.  How do you propose to do that? 

[Tom Kirkman + 8,860]

2 hours ago, Jan van Eck said:

So you need to pay for ten municipal payrolls with only one working.  How do you propose to do that? 

Related:   The latest casualty in the global pension catastrophe is…

In the year 6 AD, the Roman emperor Augustus set up a special trust fund known as the aerarium militare, or military treasury, to fund retirement pensions for Rome’s legionnaires.

Now, these military pensions had already existed for several centuries in Rome. But the money to pay them had always been mixed together in the government’s general treasury.

So for hundreds of years, mischievous senators could easily grab money that was earmarked for military pensions and redirect it elsewhere.

Augustus wanted to end this practice by setting up a special fund specifically for military pensions.

And to make sure there would be no meddling from any government officials, Augustus established a Board of Trustees, consisting of former military commanders, to oversee the fund’s operations.

Augustus really wanted this pension fund to last for the ages. And to keep a steady inflow of revenue, he established a 5% inheritance tax in Rome that would go directly to the aerarium militare.

He even capitalized the fund with 170,000,000 sesterces of his own money, worth about half a billion dollars in today’s money.

But as you can probably already guess, the money didn’t last.

Few subsequent governments and emperors ever bothered themselves with balancing the fund’s long-term fiscal health. And several found creative ways to plunder it for their own purposes.

Within a few centuries, the fund was gone.

This is a common theme throughout history… and still today: pension funds are almost invariably mismanaged to the point of catastrophe.

...  

With Social Security, it’s the United States Secretary of the Treasury who says the program’s trust funds will soon be depleted.

Social Security even provides a date, like the expiration on a carton of milk, after which Social Security will go bad.

These warnings are all publicly available information, not some wild conspiracy theory. And that’s really what they are: warnings.

At this point, continuing to believe that these pensions will be solvent forever is completely ludicrous.

[Jan van Eck + 7,558]

2 minutes ago, Tom Kirkman said:

Related:   The latest casualty in the global pension catastrophe is…

In the year 6 AD, the Roman emperor Augustus set up a special trust fund known as the aerarium militare, or military treasury, to fund retirement pensions for Rome’s legionnaires.

Within a few centuries, the fund was gone.

This is a common theme throughout history… and still today: pension funds are almost invariably mismanaged to the point of catastrophe.

And if you think Rhode Island is a mess, with all their principal cities headed for the bankruptcy court (and the pensioners getting the shaft, let us not forget), then swoop on over to neighboring COnnecticut.  In both States, the public servants are not on Social Security, but are on the State funding system, sowhen the State or the political subdivisions go belly-up, the place that the Bankruptcy Court Executors look to restore fiscal health to the City is to excuse themselves from those pension obligations.  The only other place you see that on a grand scale is Russia, where the Government does not even bother with formalities, but simply stops paying.  In both cases, the pensioner, who was counting on that pension, is out in the cold.

Or maybe not.  In Connecticut, the top State-paid pension is now $306,000.  That is the basic pension, and on top of that are lifetime health insurance and various other perks. THe next twenty pension dollars are all over $200,000, again with perks on top.  A lonely policeman after 20 years retires with at least $65,000, a lot more if he did a lot of overtime in his last year  (the formula makes for enhanced lifetime pension payments if the last year's income is higher.)  Now, the people running the Boards and Commissions that set those pensions are playing with "other peoples' money," namely the State Treasury, and the thought process was always that the expanding State wealth and economic activity and population would be there in the future to pay for it all.

So what happens?  The State becomes a creaking, stuffed bureaucracy, run by unthinking and uncaring bureaucrats, and the average public - and, most ominously, the entrepreneurial class - votes with their feet and leaves.  OK, so now what?  How do you fund ongoing operations when the budget is jammed up with huge pension obligations, and the tax base is shrinking?  Last year over 25,000 people voted with their feet and abandoned the State.  The Legislature and the Governor went after the gun industry, and now you need a special permit just to buy ammunition. The result. Whole factories have been dismantled and moved out; remember, Connecticut was the cradle of the firearms industry, with Colt et al home there.  And so there goes n=more of your population and tax base.  It is now so bad that the transfer payments made from the State to the Towns to support the schools have been cut off.  Not decreased; Cut Off.  So once again the effective tax burden on the people goes up, to pay for the shortfall. Meanwhile, Connecticut has this stupendous budget shortfall of $1.9 Billion dollars, for a little State with 3 million people.  

Is this headed for disaster?  No, the disaster has already arrived.  The politicians are now just beginning to grasp the magnitude. And you will see that playing out all over the USA. 

[Billyjack + 58]

Is Rhode Island still a state?

[AZDuffman + 7]

One day "Big Oil" needs to respond one of 2 ways:

1.  Raise the price at the pump by say $0.25/gal.  Post a notice that this is a surcharge to cover legal costs, then put a phone number of the governor's office to complain.

2.  Close all stations, shut off all jobbers.  Refuse to allow pipeline access.  Take out a full-page newspaper ad the same day, saying "Your government does not want oil, so you shall have none."

 

 

 

[razor + 1]

i am happy to join this news about oil i focus on oil stocks and the oil market so i thank you for allowing me to join

 

[Jan van Eck + 7,558]

15 minutes ago, razor said:

i am happy to join this news about oil i focus on oil stocks and the oil market so i thank you for allowing me to join

 

Good to have you on board, Razor!  Be sure to chime in here on the Discussion Boards when you know of something  and would like to share it!  We look forward to seeing your posts. Cheers. 

[Rooster + 3]

LW

[Rooster + 3]

Im happ to be a member

[Pam + 2]

New member - looking forward to learning/discussions

[Tom Kirkman + 8,860]

Welcome to the Oil Price Community, Rooster and Pam.  Please feel free to introduce yourselves in the New Members thread:

 

[Jan van Eck + 7,558]

4 hours ago, Pam said:

New member - looking forward to learning/discussions

Welcome aboard, Pam, and do chime in on the discussions here, we are delighted to hear your perspectives!  Cheers, Jan

[Jo Mack + 43]

"Customer-centriv top performers with the bandwidth to multi-taskify forward thinking innoventions"?

This is in the complaint from Rhode Islands in pursuit of damages from Big Oil? I know that judge is still sitting there scratching his head - like Ferris Buellers teacher asking --- "anyone? Anyone? 

I'm definetly vaklempt!

[Jan van Eck + 7,558]

2 minutes ago, Jo Mack said:

"Customer-centriv top performers with the bandwidth to multi-taskify forward thinking innoventions"?

This is in the complaint from Rhode Islands in pursuit of damages from Big Oil? I know that judge is still sitting there scratching his head - like Ferris Buellers teacher asking --- "anyone? Anyone? 

I'm definetly vaklempt!

You have to wonder if the junior people inside that attorney-general's office that did the writing had decided to have a little fun and do some spoofing, just to see if anybody would react.  Sometimes the greatest fun in being absurd is to be so absurd that everybody thinks you are perfectly serious!

[Tom Kirkman + 8,860]

2 hours ago, Jo Mack said:

"Customer-centriv top performers with the bandwidth to multi-taskify forward thinking innoventions"?

 

2 hours ago, Jan van Eck said:

You have to wonder if the junior people inside that attorney-general's office that did the writing had decided to have a little fun and do some spoofing, just to see if anybody would react.  Sometimes the greatest fun in being absurd is to be so absurd that everybody thinks you are perfectly serious!

 

[Rodent + 1,424]

4 hours ago, Tom Kirkman said:

 

 

STOP IT!!!!!!!!!!

[Jan van Eck + 7,558]

1 minute ago, Rodent said:

STOP IT!!!!!!!!!!

Tom is seriously funny!!!!!!!      (I can't stop laughing!)  

[Tom Kirkman + 8,860]

41 minutes ago, Rodent said:

STOP IT!!!!!!!!!!

Okey dokey, getting back on topic about Oil and Gas...

 

[Jan van Eck + 7,558]

Tom, who writes this stuff?   Amazing.

[Tom Kirkman + 8,860]

24 minutes ago, Jan van Eck said:

Tom, who writes this stuff?   Amazing.

It's a serious research paper that I saved, for my own amusement.

https://www.aeaweb.org/conference/2017/preliminary/paper/HZ2nYK6E

Fracking, Drilling, and Asset Pricing:
Estimating the Economic Benefits of the Shale Revolution

Erik Gilje

Robert Ready

Nikolai Roussanov

November 28, 2016

Abstract

We quantify the effect of a significant technological innovation, shale oil development, on asset prices. Using stock returns on major news announcement days allows us to link aggregate stock price fluctuations to shale technology innovations. We exploit cross-sectional variation in industry portfolio returns on days of major shale oil-related news announcements to construct a shale mimicking portfolio. This portfolio can explain a significant amount of variation in aggregate stock market returns, but only during the time period of shale oil development, which begins in 2012. Our estimates imply that $3.5 trillion of the increase in aggregate U.S. equity market capitalization since 2012 can be explained by this mimicking portfolio. Similar portfolios based on major monetary policy announcements do not explain the positive market returns over this period. We also show that exposure to shale oil technology has significant explanatory power for the cross-section of employment growth rates of U.S. industries over this period.