WSJ : U.K.’s Theresa May Seeks to Reassure G-20 on Brexit’s Effect on Trade

U.K.’s Theresa May Seeks to Reassure G-20 on Brexit’s Effect on Trade

Theresa May, Barack Obama pledge strong U.S.-U.K. ties following referendum

HANGZHOU, China—At a summit of world leaders worried about anemic global trade and investment, British Prime Minister Theresa May sought to dispel concerns of trade disruption from the U.K. decision to leave the European Union.

Flanked by U.S. President Barack Obama, Mrs. May said the U.K. is still open for business and is looking to establish new trade relations around the globe. “As we forge a new global role for the U.K., we can and will seize the opportunities that Brexit presents, and make a success of it,” she said.

Meanwhile, top EU officials warned Britain against negotiating any bilateral trade deals as long as it is still part of the bloc.

In a joint news conference before the start of a gathering of leaders from the Group of 20 top world economies, Mrs. May and Mr. Obama on Sunday said the two countries’ ties remained strong following the British decision.

Mr. Obama said the U.S. would work with Britain to make sure there is no adverse effect on trade and economic relations between the U.S. and U.K. as a result of the British decision to leave the EU. But he didn’t soften his stance that the U.K.’s decision would delay any new, direct trade negotiations between the two countries.

He said “it would not make sense” for the U.S. to put aside trade efforts with Asia and the EU to negotiate with the U.K.

“We’re going to do everything we can to make sure that the consequences of the decision don’t end up unraveling what is already a very strong and robust economic relationship that can become even stronger in the future, but first things first,” he said. “And the first task is going to be figuring out what Brexit means with respect to Europe.”


Mrs. May, who became prime minister in July following David Cameron’s resignation after the referendum, ruled out any chance the U.K. might ultimately stay in the EU. “There will be no second referendum” and “no attempt to get out of this,” she said. “The U.K. will be leaving the European Union.”

But top EU officials at the G-20 meeting stressed that Britain is still bound by the rules of the bloc as long as it is a member, including a ban on negotiating its own trade deals.

“As far as Brexit is concerned, negotiations of free-trade agreements are a competence of the European Union,” said European Commission chief Jean-Claude Juncker in a news conference.

Anticipating questions from world leaders about the impact of the British exit, Mr. Juncker said that the EU hasn’t become the “enemy” of the U.K. and that it will seek a fair partnership with the island nation. “Brexit is a sovereign decision we have to respect, but this doesn’t mean the end of the EU,” he said.

Besides the U.S., Mrs. May is expected to have preliminary talks about trade relations with Australia and China.

“They can talk to other leaders, we can’t prevent them from doing that. But they can’t engage in any trade negotiations as long as they’re part of the EU,” said an EU official.

European Council President Donald Tusk, who represents the leaders of the EU, said that “it might sound brutal,” but “we need to protect interests of the members of EU that want to stay together, not the ones who decide to leave.”

He reiterated the position that no negotiations can kick off with the British government until the legal clause is triggered that sets the two-year clock for negotiating the terms of Brexit. Mrs. May has previously indicated she won’t trigger that legal clause this year.

Mr. Juncker also stressed that if the U.K. wants to be granted access to the bloc’s internal market, it will have to respect the rules of the bloc, including granting free movement of workers. In a letter to Mrs. May leaked to British media, Foreign Secretary Boris Johnson said controlling the immigration from EU countries should be a red line for the May government in the Brexit negotiations.

Ahead of the British referendum on June 23, Mrs. May was in favor of the U.K. staying in the EU. Mr. Obama also advocated for the U.K. to remain in the EU, saying the country would move to the “back of the queue” in trade talks with Washington if it left. On Sunday, he said the U.S. supports a process for the U.K. exiting the EU that is the least destructive possible.

Asked about her government’s announcement that it would delay until the fall a final decision on a new U.K. nuclear plant partly funded by China, Mrs. May said she would review the evidence and make a determination this month.

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ZH : "Tremendous Ripple Effects" - Retailers Demand Bailout After Hanjin Collaps

"Tremendous Ripple Effects" - Retailers Demand Bailout After Hanjin Collapse Paralyzes Trade

When we first reported about the imminent paralysis of an unknown number of global supply chains and a potential shock in worldwide trade as a result of the historic bankruptcy of Hanjing Shipping, one of the world's largest container shipping companies which handles 8% of Trans-Pacific trade volume for the US market, we concluded that "the global implications from the bankruptcy are unknown: if, as expected, the company's ships remain "frozen" and inaccessible for weeks if not months, the impact on global supply chains will be devastating, potentially resulting in a cascading waterfall effect, whose impact on global economies could be severe as a result of the worldwide logistics chaos. The good news is that both economists and corporations around the globe, both those impacted and others, will now have yet another excuse on which to blame the "unexpected" slowdown in both profits and economic growth in the third quarter."

However, not even this extreme forecast captured what would happen just 48 hours later, when as the WSJ reported overnight, retailers have gone far beyond simply blaming the Hanjing bankruptcy for their upcoming woes: they are petitioning for a government bailout, or as the WSJ put it, they are "bracing for a blow as they stock up for the crucial holiday sales season, asked the government to step in and help resolve a growing crisis."

Or, as America's banks would call it, "get bailed out." And, in taking a page right out of the 2008 bank bailout, the doom and gloom scenarios emerge:

“While the situation is still developing, the prospect of harm is significant and apparent,” Sandra Kennedy, president of the Retail Industry Leaders Association, wrote in a letter to the Department of Commerce and the Federal Maritime Commission. Hanjin’s recent bankruptcy filing “presents an enormous challenge to U.S. shippers,” she said, and “could have a substantial impact on consumers and the economy at large.”

The trade group is urging the U.S. to work with ports, cargo handlers and the South Korean government to resolve the widespread disruption in freight shipments caused by the Hanjin bankrupcy filing. Futhermore, the spokesman for the Retail Industry Leaders Association said they’re hoping the South Korean government could help provide clarity and speed to the bankruptcy proceedings, which are being considered by courts there.

To an extent, the group has a point as the "clogged supply-chain" chaos unleashed by the Hanjing bankruptcy is rapidly spreading. As reported Wednesday, after the company's bankruptcy protection, on Wednesday, terminal operators, ports, cargo handlers, truckers and others have refused to handle its cargo, for fear they won’t get paid. That is causing turmoil at U.S. ports and beyond, said shippers, importers and freight forwarders. Then as we followed up yesterday, U.S.-bound cargo has been delayed at the point of origin, and cargo-laden Hanjin ships are unable to get into U.S. ports. Worse, already delivered cargo is sitting unhandled, clogging ports and occupying containers needed elsewhere. Several Hanjin ships have been seized by creditors or barred from shipping cargo from Busan, South Korea’s main port, and vessels have been turned away from ports in the U.S., China, Canada, Spain and elsewhere.

According to the WSJ, freight brokers in Asia said about 540,000 containers are expected to face delivery delays that one of them said could range from a few days to more than a month. Meanwhile, as we also reported yesterday, shipping rates have soared as freight capacity shrank overnight, and indicative rates from Busan, South Korea, to Los Angeles had risen to $2,300 a container by Thursday, up from $1,700 four days earlier. One U.S. importer said he was getting rate quotes of $2,000 a container, compared with $700 before the Hanjin news.

Meanwhile, the reason why we immediately speculated that retailers will immediately use (and abuse( the Hanjin bankruptcy as a scapegoat (and apparently, demand a government intervention) is because the turmoil will only aggravate problems for retailers grappling with the challenges and high costs of e-commerce and at a crucial time. Those most likely to be affected include Wal-Mart, Target, J.C. Penney and clothing retailers. As the WSJ adds, a target spokeswoman said the retailer is watching development closely and assessing the situation. Marilee McInnis, a spokeswoman for Wal-Mart, said, “Right now, we are waiting to hear the final determination on bankruptcy proceedings and the implications to their current assets before we will be able to assess any impact.”

The biggest hit may come for the $25 billion US toy industry, however, which has been sweating the Hanjin news, as it prepares for the holiday season, responsible for half its annual sales. Jeff Bergmann, managing director of the Toy Shippers Association, said his customers are fortunate that only about 20 containers are on Hanjin or affiliated vessels. They’ve been told their freight will be delivered to the ports, but from there, “nobody knows,” Mr. Bergmann said. Beyond that, the general concern is how long the turmoil will last. “The ripple effect could be tremendous,” he said.

Cited by the WSJ, Jessica Dankert, senior director at the Retail Industry Leaders Association, said the congestion is coming during one of the worse possible times for retailers as they stock up before the critical holiday-shopping season. “These concerns would be trouble at any time, but this is a particularly bad time for it to happen.” She said retailers are considering contingency plans that include using other carriers and working to get their cargo released.

Unfortunately, going the litigation route will be a disaster, as cargo reclamation would bottleneck the legal system and leave it stuck in limbo for years. Even without a lawsuit, cargo owners will have to wait for months to get their cargo off Hanjin ships, analysts said.

”In 2001, Cho Yang, a much smaller Korean carrier, went bust and it took six months before a mere 200 containers, handled by a single freight forwarder, could be taken off to ports,” said Lars Jensen of Copenhagen-based SeaIntelligence Consulting. “This is at a much bigger scale so I would not be surprised if scores of boxes on stranded Hanjin vessels ever actually make it to their destination.”
But forget the retailers, will someone please think of the ship crews? Hanjin ships carry crews of 15 to 25 sailors, and with the vessels unable to call at ports, the sailors could be stranded at sea for weeks or longer. “They have food and water for a couple of weeks,” said Basil Karatzas of New York-based Karatzas Marine Advisors & Co. “Beyond that, things may become very difficult because suppliers will no longer extend credit to Hanjin and everything must be paid in cash.”

Maybe instead of US retailers using debt to buyback their stocks and land their management teams record bonuses, it is the crews who should be petitioning for a government rescue.

Finally, anyone hoping for a quick resolution to chaos unleashed by the Hanjin bankruptcy, should not hold their breath. While Hanjin has obtained creditor protection in Korea, and secured an injunction protecting its ships against seizure domestically, it needs to quickly file for bankruptcy abroad, especially in Europe and the US, in order to keep its ships moving.

“They got the injunction in Korea, but most of their ships are out at sea or at foreign ports. Ship seizures will continue and increase around the world if there is no bankruptcy protection.” Jensen said. “But sorting out such legal matters at various jurisdictions is complicated, as Hanjin has no control on how fast foreign courts will examine its case.”

For now, the only thing certain is that chaos will grow exponentially courtesy of today's ultra sophisticated "just in time" supply chains which are amazingly efficient when they all work in sync, and just as easily lead to unprecedented problems (as we described several years ago in "Trade-Off": A Study In Global Systemic Collapse") when even the tiniest bottleneck emerges, quickly snowballing into a crisis of epic proportions.

NYT : Flooding of Coast, Caused by Global Warming, Has Already Begun

Flooding of Coast, Caused by Global Warming, Has Already Begun

NORFOLK, Va. — Huge vertical rulers are sprouting beside low spots in the streets here, so people can judge if the tidal floods that increasingly inundate their roads are too deep to drive through.

Five hundred miles down the Atlantic Coast, the only road to Tybee Island, Ga., is disappearing beneath the sea several times a year, cutting the town off from the mainland.

And another 500 miles on, in Fort Lauderdale, Fla., increased tidal flooding is forcing the city to spend millions fixing battered roads and drains — and, at times, to send out giant vacuum trucks to suck saltwater off the streets.

For decades, as the global warming created by human emissions caused land ice to melt and ocean water to expand, scientists warned that the accelerating rise of the sea would eventually imperil the United States’ coastline.

Now, those warnings are no longer theoretical: The inundation of the coast has begun. The sea has crept up to the point that a high tide and a brisk wind are all it takes to send water pouring into streets and homes.

Federal scientists have documented a sharp jump in this nuisance flooding — often called “sunny-day flooding” — along both the East Coast and the Gulf Coast in recent years. The sea is now so near the brim in many places that they believe the problem is likely to worsen quickly. Shifts in the Pacific Ocean mean that the West Coast, partly spared over the past two decades, may be hit hard, too.

These tidal floods are often just a foot or two deep, but they can stop traffic, swamp basements, damage cars, kill lawns and forests, and poison wells with salt. Moreover, the high seas interfere with the drainage of storm water.

In coastal regions, that compounds the damage from the increasingly heavy rains plaguing the country, like those that recently caused extensive flooding in Louisiana. Scientists say these rains are also a consequence of human greenhouse emissions.

“Once impacts become noticeable, they’re going to be upon you quickly,” said William V. Sweet, a scientist with the National Oceanic and Atmospheric Administration in Silver Spring, Md., who is among the leaders in research on coastal inundation. “It’s not a hundred years off — it’s now.”

Local governments, under pressure from annoyed citizens, are beginning to act. Elections are being won on promises to invest money to protect against flooding. Miami Beach is leading the way, increasing local fees to finance a $400 million plan that includes raising streets, installing pumps and elevating sea walls.

In many of the worst-hit cities, mayors of both parties are sounding an alarm.

“I’m a Republican, but I also realize, by any objective analysis, the sea level is rising,” said Jason Buelterman, the mayor of tiny Tybee Island, one of the first Georgia communities to adopt a detailed climate plan.

But the local leaders say they cannot tackle this problem alone. They are pleading with state and federal governments for guidance and help, including billions to pay for flood walls, pumps and road improvements that would buy them time.

Yet Congress has largely ignored these pleas, and has even tried to block plans by the military to head off future problems at the numerous bases imperiled by a rising sea. A Republican congressman from Colorado, Ken Buck, recently called one military proposal part of a “radical climate change agenda.”

The gridlock in Washington means the United States lacks not only a broad national policy on sea-level rise, it has something close to the opposite: The federal government spends billions of taxpayer dollars in ways that add to the risks, by subsidizing local governments and homeowners who build in imperiled locations along the coast.

As the problem worsens, experts are warning that national security is on the line. Naval bases, in particular, are threatened; they can hardly be moved away from the ocean, yet much of their land is at risk of disappearing within this century.

“It’s as if the country was being attacked along every border, simultaneously,” said Andrea Dutton, a climate scientist at the University of Florida and one of the world’s leading experts on rising seas. “It’s a slow, gradual attack, but it threatens the safety and security of the United States.”

‘We’re Living It.’

One night eight years ago, Karen Speights, a Norfolk resident, was sitting at the dinner table with her mother, eating crab legs dipped in butter and a tangy sauce. She felt a tingle.

“Ma!” she cried. “My feet are wet!”

Her mother laughed, but then she felt it, too: a house that had not flooded since the family moved there in 1964 was soon awash in saltwater. Ms. Speights initially hoped that flood was a fluke. Instead, it turned out to be the first of three to hit their home in less than a decade.

Nowadays, Ms. Speights, an administrative worker at a utility company, is wondering how to get her and her mother out of the neighborhood before the water comes again, without taking too much of a financial hit. And she pays more attention to problems that once seemed remote, like warnings from scientists about the rising sea.

“I believe it because we’re living it,” Ms. Speights said as she sat on her sofa, nodding toward the nearby tidal marsh that sent water into her living room. “The water has to be rising if we never flooded, and all of a sudden we’ve flooded three times in eight years.”

Because the land is sinking as the ocean rises, Norfolk and the metropolitan region surrounding it, known as Hampton Roads, are among the worst-hit parts of the United States. That local factor means, in essence, that the region is a few decades ahead in feeling the effects of sea-level rise, and illustrates what people along the rest of the American coast can expect.

The biggest problems involve frequent flooding of homes and roads. As the sea rises, hundreds of tidal creeks and marshes that thread through the region are bringing saltwater to people’s doorsteps.

This summer, on a driving tour of Norfolk and nearby towns, William A. Stiles Jr. pointed to the telltale signs that the ocean is gradually invading the region.

He spotted crusts of dried salt in the streets, and salt-loving marsh grasses that are taking over suburban yards. He pointed out trees killed by seawater. He stood next to one of the road signs that Norfolk has been forced to install in recent years, essentially huge vertical rulers so people know the depth of floodwaters at low-lying intersections.

“There’s just more and more visible impacts: water on the street, water that won’t clear from the ditch, these intense rain events, higher tides,” Mr. Stiles said.

“It’s beginning to catch the attention of citizens, restaurant owners, business people, politicians. There’s just much more of a conversation, and it’s not just in the politically safe places. It’s everywhere.”

Mr. Stiles, known as Skip, heads a local environmental group, Wetlands Watch. At his suggestion, students at two local universities began looking at the neighborhood where Ms. Speights lives, Chesterfield Heights. It has had little history of flooding, but that is starting to change as the water rises.

The plan the students developed has morphed into an ambitious program to safeguard the neighborhood, and another nearby, for decades. The Obama administration recently gave Virginia more than $100 million to carry the plan out. The administration has also enlisted one of the universities, Old Dominion in Norfolk, to spearhead a broad effort at better planning.

But the size of that grant illustrates the scope of the problem confronting the region, and the country: protecting a single neighborhood from rising water can easily cost tens of millions of dollars. Sea walls and streets may have to be raised, or movable gates built along waterways so they can be closed at times of high water.

While the Obama administration is trying to create a few showcase neighborhoods, there is no sign Congress is prepared to spend the money that cities and states say they need: tens of billions of dollars just to catch up to the current flooding problems, much less get ahead of them. Norfolk alone, a town of 250,000 people, has a wish list of $1.2 billion — or about $5,000 for every man, woman and child in the city.

As the national response lags, experts warn that the flooding is putting the country’s defense at risk.

Several studies have concluded that Naval Station Norfolk, the world’s largest naval base, is profoundly threatened by rising seas, as are other coastal bases. The Pentagon has managed to build floodgates and other protective measures at some facilities. But attempts by the military to develop broader climate change plans have met fierce resistance in Congress.

That was the case this summer, when an effort by the Pentagon to appoint officers to take charge of climate resilience led to a House vote prohibiting taxpayer money from being spent on the plan.

When we distract our military with a radical climate change agenda, we detract from their main purpose of defending America from enemies” like the Islamic State, said Mr. Buck of Colorado, the Republican congressman who sponsored the measure. His amendment passed the House 216 to 205, though the Senate has yet to agree to it.

Many people in Congress, almost all of them Republicans, express doubt about climate science, with some of them promulgating conspiracy theories claiming that researchers have invented the issue to justify greater governmental control over people’s lives. So far, this ideological position has been immune to the rising evidence of harm from human-induced climate change.

The Obama administration has been pushing federal agencies, including the Pentagon, to take more aggressive steps. But without action in Congress, experts say these efforts fall far short of what is required.

“In the country, certainly in the Congress, it hasn’t really resonated — the billions and perhaps trillions of dollars that we would need to spend if we want to live on the coast like we’re living today,” said David W. Titley, a retired rear admiral who was the chief oceanographer of the Navy, and now heads a climate center at Pennsylvania State University.

“I haven’t seen any evidence that there is serious thought about this: what does a world of three, four, five feet of sea-level rise look like?”

Mounting Evidence

Deep in a thicket of trees on an out-of-the-way island in the Florida Keys, a diesel engine roared to life. Soon a drill bit was chewing through ancient limestone, pulling up evidence from the geological past that might shed light on the future of the planet.

On a sultry day in March, Dr. Dutton, the University of Florida scientist, stood watch over the drilling operation, inspecting her samples as they emerged from the ground. She spotted fossilized corals, proof that what is now the dry ground of Lignumvitae Key was once underwater.

With taxpayer funding from the National Science Foundation, Dr. Dutton is chasing what might be the most urgent question in climate science: How fast is the ocean going to rise?

“Is it going to happen in decades, or centuries, or a thousand years?” Dr. Dutton asked as she took a break to eat lunch on a tarpaulin spread under the trees. “This will give us an example to say, ‘Well, the last time this happened, here is how long it took.’”

The opponents of climate science in Congress, and the tiny group of climate researchers allied with them, have argued that the concerns of thousands of mainstream scientists about the future are based on unproven computer forecasts.

In reality, their concerns are based in large part on mounting evidence of what has happened in the past.

Through decades of research, it has become clear that human civilization, roughly 6,000 years old, developed during an unusually stable period for global sea levels. But over longer spans, coastlines have been much more dynamic.

During ice ages, caused by wobbles in the Earth’s orbit, sea levels dropped more than 400 feet as ice piled up on land. But during periods slightly warmer than today, the sea may have risen 70 or more feet above the current level.

Dr. Dutton and other leading scientists are focused on the last sea-level high point, which occurred between the last two ice ages, about 125,000 years ago.

After years of surveying ancient shorelines around the world, scientists determined that the sea level rose by something like 20 to 30 feet in that era, compared with today. But how long did it take to make that jump? That is the question Dr. Dutton, using improved research techniques, wants to answer.

Large parts of the Florida Keys are simply ancient coral reefs that grew during the period of high seas, and were exposed when the levels fell. Trees, roads and houses now sit atop the old reefs. By recovering samples, Dr. Dutton hopes to date a sequence of corals as they grew along with the rising sea, potentially revealing the rate at which the water rose.

The research, likely to take years, may supply a figure for how quickly the ocean was able to rise under past conditions, but not necessarily a maximum rate for the coming decades. The release of greenhouse gases from human activity is causing the planet to warm rapidly, perhaps faster than at any other time in the Earth’s history. The ice sheets in both Greenland and West Antarctica are beginning to melt into the sea at an accelerating pace.

Scientists had long hoped that any disintegration of the ice sheets would take thousands of years, but recent research suggests the breakup of West Antarctica could occur much faster. In the worst-case scenario, this research suggests, the rate of sea-level rise could reach a foot per decade by the 22nd century, about 10 times faster than today.

In 2013, scientists reached a consensus that three feet was the highest plausible rise by the year 2100. But now some of them are starting to say that six or seven feet may be possible. A rise that large over a span of decades would be an unparalleled national catastrophe, driving millions of people from their homes and likely to require the abandonment of entire cities.

In essence, by revealing how sensitive the ice sheets have been to past warming, Dr. Dutton’s research may answer the question of whether such a rapid jump is possible.

Along those parts of the United States coast that are sinking at a brisk clip, including southern Louisiana and the entire Chesapeake Bay region, including Norfolk, the situation will be worse than average. On the Pacific Coast, a climate pattern that had pushed billions of gallons of water toward Asia is now ending, so that in coming decades the sea is likely to rise quickly off states like Oregon and California.

Along the East Coast, scientists with the National Oceanic and Atmospheric Administration say that many communities have already, or will soon, pass a threshold where sunny-day flooding starts to happen much more often.

“When you look at the historical record, there’s no trend saying the flooding is going down,” said Dr. Sweet, the NOAA expert. “The trends are all very clear. They’re going up, and they’re going up in many of these areas in an accelerating fashion.”

Late last year, in Paris, nations reached a landmark global agreement to cut emissions. It is fragile, and might not survive if Donald J. Trump is elected president in November; he has vowed to scrap it.

But the air is already so full of greenhouse gases that most land ice on the planet has started to melt. So even if the deal survives, it will, at best, slow the rise of the sea and perhaps limit the ultimate increase. Many climate scientists, including Dr. Dutton, believe a rise of at least 15 or 20 feet has already become inevitable, over an unknown period.

Facing Hard Decisions

As Brad Tuckman walked the piece of land in Fort Lauderdale where he is building a grand new house, he pointed toward the canal that wraps around three sides of the property.

It is scenic, with yachts plying the water, yet as the sea has risen, street flooding in the area has become a recurring nuisance. So before starting construction, Mr. Tuckman said he spent nearly a half-million dollars to raise the sea wall and truck in dirt to elevate the land.

“The predictions of what’s going to happen over the next 20, 30, 40 years — it’s real,” said Mr. Tuckman, the founder of a company offering creative services to the retail industry.

In South Florida, among the worst-hit parts of the country for sunny-day flooding, people are not waiting for state or federal help. Those who can afford it are starting to act on their own. A company, Coastal Risk Consulting, has cropped up to advise them, and is offering its services nationally.

Cities and counties in the region have formed an alliance and enlisted professors to help them figure out what to do. They are hiring “chief resilience officers,” an idea pioneered by the Rockefeller Foundation in New York, which is paying some of the salary cost.

In Miami Beach and Fort Lauderdale, as well as in older Northern cities like Boston and New York, tidal marshes and creeks were filled in a century or more ago to make new land, and it is in these areas — “back bays,” as some of these spots are called — where the flooding is happening first.

That is because they remain the lowest spots in the landscape, vulnerable to the rising water nearby. Old drain pipes empty into the tidal creeks, and at high tide the water can back up through these pipes, bubbling into the streets seemingly from nowhere.

In Miami Beach, the city engineer, Bruce A. Mowry, has come up with a plan for combating the flooding. He rips up problematic streets, raises them with extra dirt and repaves them, installing new drains and giant pumps that can push water back into the bay. The approach has already been shown to work in several neighborhoods.

A controversy has erupted about whether Miami Beach is polluting Biscayne Bay with the water, but the city is pushing ahead. Miami Beach plans to spend at least $400 million on its plan by 2018, raising the money through fees imposed on homes and businesses.

The huge county government for the region, Miami-Dade County, is developing its own resilience strategy, one likely to cost billions. It has committed to rebuilding some of its decaying infrastructure, like a sewage plant, in a way that safeguards against sea-level rise and storm surges.

“I don’t see doom and gloom here; I see opportunity,” said Harvey Ruvin, the clerk of courts for Miami-Dade County, who has been a leading voice on the environment in Florida for a half-century, and who recently led a county task force on sea-level rise. “We’re talking about the most robust possible jobs program you can think of, and one that can’t be outsourced.”

Many of the Republican mayors in the region are on the same page as Democrats in requesting national and state action on climate change, as well as pushing local steps. James C. Cason, the Republican mayor of Coral Gables, has convened informational sessions that draw hundreds of residents, and he has received no complaints for his stance.

“I hope in coming years when we have to spend a lot of money, the citizens will still support it,” Mr. Cason said in an interview.

Still, his city, and others in South Florida, have some hard decisions to make.

Some property owners cannot afford to raise their sea walls, putting their neighborhoods at increased risk of flooding. Will they be held legally responsible when floods do occur? A strict policy could force some people from their homes. Conversely, should public money be spent to do the work, even if it largely benefits private property?

Just for streets, storm drains and the like, South Florida governments will need to raise billions, and they have yet to figure out how. Moreover, if the rise of the sea accelerates as much as some scientists fear, it is doubtful the cities will be able to keep up.

The region has one mayor, Philip K. Stoddard of South Miami, who is a scientist himself — he studies animal communication at Florida International University — and has been a close reader of scientific papers about climate change since the 1990s.

“I remember lying in bed at night thinking, ‘I hope this isn’t real,’” Dr. Stoddard, a Democrat, recalled. “I hope other data comes in that contradicts it. It took me several years to get my head around it and say, ‘Oh, God, it is real.’”

Now he is focused on easing the pain for South Miami, with a $50 million system of sewer pipes to replace septic tanks threatened by the rising water table.

“You can play it really badly and let unpleasant things happen earlier,” he said. “Or you can push them off by doing some infrastructure repairs and some thoughtful planning.”

He is, though, under no illusions about the long-term fate of the region he calls home.

“We’re putting enough heat in the ocean to send water over us, no question,” Dr. Stoddard said. “Ultimately, we give up and we leave. That’s how the story ends.”

WSJ : Mosquitoes Are Deadly, So Why Not Kill Them All?

Mosquitoes Are Deadly, So Why Not Kill Them All?

Zika virus’s spread adds urgency to gene editing that could allow scientists to program the insects to die off, but the idea is fraught with quandaries

The death toll from diseases carried by mosquitoes is so huge that scientists are working on a radical idea. Why not eradicate them?

Mosquitoes kill more humans than any other animal and were linked to roughly 500,000 deaths in 2015, mostly from malaria. For more than a century, humans have used bed nets, screens and insecticides as weapons, but mosquitoes keep coming back. They are now carrying viruses like Zika and dengue to new parts of the world.

Powerful new gene-editing technologies could allow scientists to program mosquito populations to gradually shrink and die off. Some efforts have gained enough momentum that the possibility of mosquito-species eradication seems tantalizingly real.

“I think it is our moral duty to eliminate this mosquito,” entomologist Zach Adelman says about Aedes aegypti, a species carried afar over centuries by ships from sub-Saharan Africa. It derived from a forest dweller and adapted to thrive among humans, to whom the mosquito spreads at least four viruses that cause major diseases.

Prof. Adelman, a virologist and associate professor of entomology at Texas A&M University, is working to program Aedes aegypti mosquitoes to develop as males.


Eventually, the mosquitoes would run out of mates, crashing the species’ population in places it invaded and “cleaning up a global mess,” he says. Female mosquitoes are the only ones that bite people and transmit viruses.
Purposely engineering a species into extinction—or just diminishing it—is fraught with quandaries. Scientists must weigh the potential impact of removing a species on the environment and food chain. It will take years of more research, testing and regulatory scrutiny before most genetically altered mosquitoes can be released into the wild. And the strategy might not work.

Wiping a species off the face of the earth is “an unfortunate thing to have to do,” says Gregory Kaebnick, a research scholar at the Hastings Center, a bioethics research institute in Garrison, N.Y.

He says humans shouldn’t force a species into extinction to meet their own preferences. “We ought to try not to do it,” says Mr. Kaebnick. One justification, he says, would be to avert a serious public-health threat.

Out of more than 3,600 mosquito species, only a few dozen transmit viruses and parasites that can sicken or kill humans. Even the killer mosquitoes pollinate plants and are food sources for other animals, though usually not the only staple, entomologists say.

For decades, agricultural officials have used a “sterile insect technique” to eliminate pests that are dangerous to crops or humans. Insects are sterilized with radiation and then released into the wild.

Insects that mate with the sterilized ones produce no offspring, and the populations die off within a few generations. The technique was used to rid the U.S. and a few other countries of the New World screwworm fly, and it is now being used to battle fruit flies.

Imperial College London researchers are refining a system under development for the past several years to drive a self-destructive genetic trait into the Anopheles gambiae mosquito, the major carrier of malaria in sub-Saharan Africa. The trait could eventually shrink the malaria carrier’s population. Malaria kills an estimated 438,000 people a year.

Aedes aegypti is high on the hit list of more scientists now that Zika has spread from Brazil to Miami, spawning an epidemic that has left hundreds of babies with devastating birth defects.

The same type of mosquito caused dengue to proliferate through tropical regions world-wide during the last quarter of the 20th century. The dengue virus infects an estimated 390 million people a year, killing thousands of them.

Aedes aegypti also is a carrier of chikungunya, a crippling disease that causes lasting joint pain, and yellow fever. In Africa, officials are struggling to contain a large outbreak of yellow fever, which can lead to fatal liver disease.

“Aedes aegypti is literally probably the most dangerous animal in the world,” says Omar Akbari, a molecular biologist and assistant professor of entomology at the University of California, Riverside. His conclusion is based on the number of infections to which the mosquito is linked.

Many entomologists say eradicating Aedes aegypti would have a minimal impact on the environment. Such mosquitoes thrive around humans, breeding in water that collects in tires, pipes and plastic containers. Humans are their only source of food.

Zika-carrying mosquitoes aren’t very appealing to other animals as a food source, entomologists say. “They’re so tiny a bat would have to eat thousands of them to equal a couple of moths,” says Michael Doyle, an entomologist and former executive director of the Florida Keys Mosquito Control District, which battled a dengue outbreak several years ago.

Genetic-engineering technologies used by mosquito-fighting scientists include a new tool known as Crispr/Cas9.

With Crispr/Cas9, scientists can use an enzyme to snip DNA and insert changes, then build something called a “gene drive” that makes those changes more likely to be inherited by future generations, altering them. Normally, genes have only a 50% chance of being inherited.

Prof. Adelman and Virginia Tech biochemistry professor Zhijian Tu see a way to do this with genes involved in mosquito reproduction. In a paper published in Science last year, the researchers identified a gene that makes Aedes aegypti mosquitoes male.

“This was the master switch that controls sex,” says Prof. Tu. He and Prof. Adelman were co-authors of the research.

The researchers now are working on a system to program mosquitoes to develop as males. Since only females bite, that change could reduce the ability to spread disease. The researchers aim to then use Crispr/Cas9 to build a gene drive that would spread the change through successive generations.

“If you’re successful, then you end up with all males, and the local population crashes,” says Prof. Tu. Prof. Adelman cautions that a system to target Aedes aegypti would have to be designed to leave the African forest-dwelling mosquito Aedes aegypti formosus intact. That type of mosquito doesn’t threaten human, he says.

Prof. Akbari at UC Riverside is using Crispr/Cas9 to design a gene-drive system that would inactivate a fertility gene in female Aedes aegypti mosquitoes and then pass on the inactivated gene. That would sterilize future generations of females.

He hopes to test the system within the next several months. “We’re working as fast as we can,” Prof. Akbari says.

Using different technology, Oxitec Ltd. has developed what it calls a “self-limiting” Aedes aegypti mosquito, a male genetically modified to produce offspring that don’t survive or reproduce.

In August, the Food and Drug Administration allowed Oxitec to go ahead with a field trial in Key Haven, Fla. Oxitec is a unit of biotechnology firm Intrexon Corp., based in Germantown, Md.
Oxitec’s technology isn’t as powerful as those using gene drive, because the trait isn’t pushed through multiple generations of mosquitoes. As a result, Oxitec’s genetically modified mosquitoes need to be released regularly.

The company says its tests in Brazil, Panama and the Cayman Islands, where the engineered insects are released in a small area, have cut the Aedes aegypti population in those areas by more than 90%.

ENLARGE
In one field trial in a district of Piricicaba, Brazil, cases of dengue fever fell 91% from the same period a year earlier, Oxitec says.

“We focused on Aedes because we saw it as a great unmet need,” says Haydn Perry, Oxitec’s chief executive. “If you look at the statistics, the rise in dengue has been absolutely shocking since the 1970s.”

In June, a committee of the National Academies of Sciences, Engineering and Medicine said in a report that organisms modified by gene drive aren’t ready to be released into the wild.

More research is needed on how the modified organisms work and might affect the environment, the report said, concluding that their proposed uses “are based on limited proof-of-concept studies.”

“We need to think through what responsible conduct looks like when you have these tools in your hand,” says James Collins, a professor of natural history and the environment at Arizona State University who is one of the committee’s leaders.

Field trials and releases of genetically modified mosquitoes require regulatory approval and can take years.

In the Florida Keys, Oxitec’s “self-limiting” mosquitoes face opposition from residents who worry that the insects could harm local ecosystems.

The field trial that got a go-ahead from the FDA will face a nonbinding referendum from voters in Key Haven on Nov. 8. After that, the field trial must be approved by the Florida Keys Mosquito Control District, spokeswoman Beth Ranson says.

Winning consent from the many countries infested with Aedes aegypti for eradication through the use of gene drive will be difficult. That could limit the impact of the mosquito-fighting technique.

“How on earth are we going to manage informed consent and diplomatic agreement?” says Kevin Esvelt, an evolutionary engineer at the Massachusetts Institute of Technology. In 2014, he outlined how using Crispr/Cas9 gene drives could spread genetic traits through wild populations.

Some scientists and foundations say total eradication isn’t necessary. One alternative strategy is to suppress the population of virus-carrying mosquitoes low enough that there are too few left to transmit pathogens from one person to another. That approach could be combined with traditional mosquito-control strategies such as spraying and bed nets.

“We’re not targeting to eliminate mosquitoes. We’re really targeting to eliminate the human diseases,” says Scott Miller, deputy director of the malaria team at the Bill & Melinda Gates Foundation.

In December, researchers at Imperial College reported in the journal Nature Biotechnology that they engineered genetic changes that could make Anopheles gambiae populations plummet. That is the most common carrier of the deadliest form of malaria in sub-Saharan Africa, where the vast majority of cases and deaths occur.

The researchers used Crispr/Cas9 to disrupt genes involved in producing eggs in females, then built a gene drive that passed that trait along to as many as 99.6% of their offspring. As the trait spreads, more females become sterilized, gradually reducing the population, the researchers said.

Imperial College evolutionary geneticist Austin Burt says he and his colleagues are now refining their work.

The Gates Foundation is investing $75 million in the Target Malaria project, partly to help prepare laboratories in Mali, Burkina Faso and Uganda, lay the groundwork to seek regulatory approvals and train staff to conduct field trials. Dr. Miller says release of the engineered mosquitoes into the wild is about a decade away.

Researchers in Australia have developed a way to inject mosquito eggs with a common, naturally occurring bacteria. The eggs need to be injected just once and then pass down the bacteria.

The method is likely to be ready for use far sooner than gene-drive strategies, says Scott O’Neill, director of vector-borne diseases at Australia’s Monash University and head of the mosquito-injection program, called Eliminate Dengue. Large-scale trials are planned in Brazil and Colombia. Financial backers include the Gates Foundation.

Despite the early progress in using gene-editing to conquer the world’s deadliest mosquitoes, many scientists are chastened by history.


In the 1940s, public-health leaders declared war on Aedes aegypti, going after the insects with aggressive spraying campaigns that included DDT, or dichloro-diphenyl-trichloroethane. By the 1970s, the push was largely abandoned. It succumbed to high costs, feared health risks from DDT, a lack of strong U.S. support and the insect’s resurgence in some areas.

Right now, says Texas A&M’s Prof. Adelman, gene drive seems like “an all-powerful tool that will win the war for us, but that is exactly the sentiment that people felt when things like DDT first came along.…It’s good to be optimistic. But we need to be realistic as well.”

WSJ : Earthquake Shakes Swath of Midwest Where Wells Have Drawn Scrutiny

Earthquake Shakes Swath of Midwest Where Wells Have Drawn Scrutiny

U.S. Geological Survey says 5.6-magnitude tremor centered in north-central Oklahoma; no major damage reported

A 5.6-magnitude earthquake rattled Oklahoma Saturday, damaging buildings and tying for the strongest temblor ever recorded in the state, which has experienced a rash of earthquake activity in the past decade that U.S. seismologists have tied to the underground disposal of wastewater from oil and gas drilling.

The earthquake took place around 7:02 a.m. central time near Pawnee, Okla., a town of about 2,200 people roughly 55 miles northwest of Tulsa, according to the U.S. Geological Survey. It was felt widely through the middle of the country, with reports coming from as far as Houston and Kansas City, according to the USGS.

There were no immediate reports of injuries, but local television reports showed damage to some buildings in Pawnee. People in other parts of Oklahoma reported cracked brick facades and other structural damage including in Stillwater, Okla., home to Oklahoma State University. It was not immediately clear whether the temblor was natural or triggered in part by human activity.

Officials in Pawnee are assessing damage in town, where the earthquake caused some building facades to crack and in some cases crumble. Chunks of a 100-year-old building fell two stories to litter the sidewalk near the city’s main street, officials said.

“That’s one of our historic buildings. But there have been no injuries, praise God,” said Lou Brock, a city councilman.


Mr. Brock said he was awake and was wishing a friend happy birthday when the rumbling started. “This was not the gift I wanted to give them,” he said. He felt the ground moving for over a minute.

“One of those incredible feelings,” he said.

The city asked residents to report any structural problems or smells of gas, he said.

“Right now the situation is that as long as we get the most information from our wonderful city people I think we’re going to be just fine,” Mr. Brock said.

Gov. Mary Fallin, a Republican, said on Twitter that state officials were asking structural engineers to assess bridges and building safety following the quake. Oklahoma Corporation Commission staffers were also reviewing oil and gas wastewater disposal wells in the vicinity of the quake area, she added.


Oklahoma has a history of seismic activity, and earthquakes in the state are not unheard of. But it has stepped up regulation of the wastewater injection wells after seeing a dramatic increase in seismic activity over the past decade. In 2015 the USGS recorded 2,500 quakes with a magnitude of 2.5 or higher in the state, up from just three in 2005.

The USGS in March released maps that for the first time show the potential risk of man-made as well as naturally occurring earthquakes, and they listed some parts of Texas and Oklahoma now at the same danger of temblors as California, due largely to the injection-well trend.

The strongest quake previously recorded in Oklahoma was also a 5.6 magnitude event, and took place near Prague, Okla. in 2011, buckling roads and destroying 14 homes. It spurred several lawsuits from homeowners who claimed energy companies burying wastewater nearby had helped trigger the quake.

When energy producers extract oil and gas from wells, thousands of barrels of salty water laced with heavy metals come up along with the fuel. The water often is injected back underground under high pressure into special disposal wells.

But government and academic researchers have found that the practice may help trigger movement along geologic fault lines. The oil-and-gas industry has acknowledged the validity of the studies and cooperated with regulators, but has said that more research is needed to link specific wells to specific incidents.

After Oklahoma’s Corporation Commission began taking stronger actions to police the location and volume of injection wells, the number of quakes in the state fell by roughly 25% compared with a year earlier, state officials said in June.

The quake’s epicenter was roughly 25 miles north of Cushing, Okla., one of the world’s major oil hubs. The town holds some 64 million barrels of crude in about 400 massive, aboveground tanks.

A representative of Enbridge Inc., one of the top pipeline and storage companies in Cushing, said no damage had been reported at its sites there.

“Following the earthquake, Enbridge employees were directed to conduct visual inspections of tanks, manifolds and other facilities. The Cushing Terminal is currently operating normally,” the company said.

>>> Pioneer attracts joint bid from Advent and CVC – report (translated)

Pioneer attracts joint bid from Advent and CVC – report (translated)

Pioneer, the asset management arm of Unicredit, has attracted the interest of a consortium made up private equity firms Advent and CVC, Italian language daily Il Sole 24 Ore reported. The unsourced report said that the two companies had been looking at the dossier over the last few weeks.

Both PE firms know the company well after having made separate bids for Pioneer in 2014. However, the item claimed that industry buyers are in a stronger position to acquire Pioneer if it is sold off. The report said that an IPO for Pioneer is still under consideration.

JPMorgan is acting as the financial advisor to the Pioneer dossier and Gianni Origoni Grippo Cappelli is its legal advisor, the report said.
The report also cited Gian-Maria Gros Pietro, the chairman of Italian bank Intesa Sanpaolo, as saying that a merger between its asset management arm Eurizon and Pioneer is not under consideration.

Such a merger would have created a company with EUR 483bn in assets under management, as previously reported.