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No Exports

Fees and price adjustments deter investment in exports- long term expectations are key and bleak

Denning, 12 -- Wall Street Journal staff

(Liam, "Gas export profits might leak away," 8-12-12,, accessed 8-16-12, mss)

THE latest free lunch being peddled involves exporting US natural gas. Don't be surprised if it evaporates. Headline US gas futures bounce around $3 per million British thermal units. Meanwhile, Japan imports liquefied natural gas, or LNG, for about $17. That spread is why companies such as Cheniere Energy are racing to build plants to export US gas. But if "$3 in, $17 out" sounds too good to be true, that is because it is. While the economics of exports can make sense, they are no slam-dunk. First, the actual cost of delivering US gas overseas would be much higher than $3. According to consultancy PFC Energy, a number of upward adjustments must be made. As the contract that Spain's Gas Natural Fenosa signed last year with Cheniere indicates, the buyer typically pays a premium over the market price of gas. This amount, say 15 per cent, covers the cost to the facility operator of gas lost during liquefaction. That takes the price to $3.45. Then you need to add on the fee for liquefaction, roughly $2.50 to $3. Shipping fees, meanwhile, range anywhere from about 85c to almost $2.80 depending on whether you're going to Europe or Asia and the route you take. Finally, in Europe the main competition is pipeline gas from places like Russia. So to be truly comparable, you must add in the cost of converting the LNG back to gas, perhaps another 40c. All in, therefore, at a $3 gas price, US LNG costs about $7.25 in Europe and $9.20 in Japan, using PFC's assumptions. Based on current prices, that still leaves a nice margin of about $5 in Europe and almost $8 in Japan. If that still looks like a no-brainer, you are forgetting one thing: time. The earliest the US is likely to start gas exports is in 2015. Moreover, contracts for capacity at LNG plants typically span 20 years. Long-term expectations are critical, therefore. US gas prices are expected to rise - in part because exports should help relieve the current supply glut. Futures for 2016 to 2020 average about $5 and analysts and producers assume long-term prices of $6 or more. Meanwhile, European and Asian gas prices are linked to that of oil. As a rule of thumb, oil-linked gas in Europe commands about 12 per cent of the quoted price of Brent crude; in Asia the ratio is about 15 per cent. Assuming $100 a barrel Brent crude long-term, this implies prices of $12 and $15 respectively. Suddenly, the margins drop to $1.30 and $2.34 for Europe and Japan, respectively. This is still positive, but much thinner. As Nikos Tsafos, gas specialist at PFC, puts it: "I don't need to mess with the model so much to make it not work." Push gas to $7 and Brent to $90 - more in line with historical price ratios - and both margins go negative. Indeed, Deutsche Bank sees no arbitrage opportunity for US LNG targeting the UK after 2016 based on current futures prices. Shipping and processing costs could rise. Oil and gas prices bounce around. And political opposition to gas exports, on the premise that they raise domestic energy prices, is a wild card. This won't prevent exports. But it limits the likely buyers of liquefaction capacity. Integrated global gas companies seeking to capitalise on short-term arbitrage opportunities, such as BG, are one small set. Utilities in uncompetitive markets where costs can more easily be passed on to consumers, such as in Asia, are another. Less than a decade ago, the energy world was abuzz with plans to dot the US coastline with gas import terminals in anticipation of steep declines in domestic output and rising prices. Today's excitable export enthusiasts would do well to recall how that one turned out.

Exports are self-defeating- the first wave would collapse the price differential and make it uneconomical

Levi, 12 -- CFR energy senior fellow

(Michael, PhD in war studies from the University of London, Council on Foreign Relations Energy and the Environment senior fellow, Program on Energy Security and Climate Change director, "A Strategy for U.S. Natural Gas Exports," June,, accessed 8-16-12, mss)

The first way that prices could converge is through U.S. LNG exports, which could ultimately bring the various prices together, net of transport costs (including an indeterminate risk premium paid to investors in risky LNG projects). Indeed initial natural gas exports themselves will tend to shrink opportunities for subsequent exports. A recent DOE study projects that with moderate U.S. gas resources and twelve billion cubic feet a day of exports, U.S. benchmark prices would rise to more than $8 per thousand cubic feet by the middle of the next decade (EIA 2012c). When combined with the cost of moving natural gas from the United States to overseas markets, there is a strong chance that some exports would be unprofitable at that price. The same analysis found that if U.S. resources were lower than anticipated, prices could reach $14 per thousand cubic feet by 2020, making exports undoubtedly uneconomic at the margin. All that said, assuming U.S. LNG exports at the outset of this analysis would make no sense, since their very existence depends on the particular export policy that is adopted.

Comprehensive study proves

Levi, 12 -- CFR energy senior fellow

(Michael, PhD in war studies from the University of London, Council on Foreign Relations Energy and the Environment senior fellow, Program on Energy Security and Climate Change director, "A Strategy for U.S. Natural Gas Exports," June,, accessed 8-16-12, mss)

It is far from clear that all or even most of this export volume would be used even if it were approved. A recent MIT study looked at nine scenarios for U.S. and world natural gas markets; none of them led to the emergence of significant U.S. natural gas exports, in large part because other lower cost producers undercut prices offered by the United States in distant markets (MIT 2011). Other forces, discussed in Chapter 2, could also lead global natural gas prices to converge even without U.S. exports, removing opportunities for economically attractive U.S. LNG sales.

No Beaufort Gas Extraction

No link – Low natural gas prices make Beaufort gas uneconomic

Callow 12 Lin Callow, LTLC Consulting, “Oil and Gas Exploration & Development Activity Forecast: Canadian Beaufort Sea 2012-2027” prepared for Beaufort Regional Enviornmental Assessment Aboriginal Affairs and Northern Development Canada April 2012

Increases in North American shale gas production have caused natural gas unit prices to tumble from more than US $8 per mcf in 2008 to about US $4 last year, with current spot prices even lower at between US $2 and $3. Natural gas prices remaining at current levels would likely render Arctic gas production uneconomic. Although, exploration in the deep shelf and slope areas of the Beaufort Sea is not dependent on the MGP, should MGP not proceed on the proposed project schedule, industry exploration and development activities in the Beaufort Sea are expected to focus more on oil than natural gas.

No Switch

AND- Rebound effect cancels out benefits

Hickman, 12 – Guardian environmental correspondent and editor

(Leo, "How Green is Shale Gas?" Guardian, 5-29-12,, accessed 6-2-12, mss)

However, those pesky caveats can't be suppressed for long. The principal danger is that a "dash for gas" will suck investment and momentum away from the fledgling renewables sector. Cheap, abundant gas might also trigger the "rebound effect" - people will likely just burn more of the stuff, thereby quickly cancelling out any carbon savings. There also seems to be far too much confidence that carbon capture and storage will ride in to save the day, when the technology is still a very long way off from being proven.

A2: SCS Impact

1NC SCS/China Adv

Alt cause- shipping routes, fish, and oil

Deutsche Welle ’12 (9-5 ("Why is the South China Sea such a bone of contention?" 9-5-12, l/n, accessed 10-6-12, mss)

Why is the South China Sea such a bone of contention?

The tension in the South China Sea has escalated since the start of the 21st century, as neighboring states vie to protect their strategic and economic interests, but what are they really fighting for? Its geopolitical location, an abundance of fish and huge gas and oil reserves make the South China Sea particularly attractive to the 10 states that all lay claim to parts of it - China, Taiwan, the Philippines, Malaysia, Brunei, Vietnam, Indonesia, Singapore, Thailand and Cambodia. There are also hundreds of islands and reefs in the South China Sea, which the Vietnamese call the East Sea. The Paracel Islands (known as the Xisha in China and the Hoang Sa in Vietnam), the Spratly Islands (known as the Nansha Qundao in China, the Truong Sa in Vietnam and the Kapuluan ng Kalayaan in the Philippines) are the most important disputed island groups. The sea is also important to the rest of the world as it connects Europe, Africa, the Middle East and South Asia with East Asia and at least one third of global shipping transits through its waters. Almost all of China's oil exports arrive via the South China Sea and nearly all of China's exports to Europe and Africa go in the opposite direction. "In strategic and military terms, the South China Sea is in a key position that enables control not only over South East Asia but over the wider realm of South and East Asia too," Gerhard Will from the German Institute for International and Security Affairs in Berlin told DW. Fish in abundance The South China Sea is also home to an abundance of fish. According to the International Crisis Group, 10 percent of the annual global fish yield hails from this huge body of water. However, the fisheries are at risk from over-fishing and pollution. More and more, fishermen are being forced out into deeper waters to make a living but here they sometimes clash with maritime patrol forces protecting their national interests. Fishermen have been arrested, their nets damaged and their boats confiscated by the security forces of other countries. Such incidents have increased in recent years. Not only is fish an important source of protein for the population, it is often an important branch of the economy. In 2010, the fishing industry made up 7 percent of Vietnam's GDP. In the Philippines, some 1.5 million people earn their living from fishing. Rich in gas and oil However, it is the unknown riches of gas and oil that are creating most of the tension over the South China Sea, especially as the energy needs of China and Southeast Asian nations grow as their economies boom. "The deep waters have not yet been explored. Companies are reluctant because of the border disputes," Hans Georg Babies from the German Mineral Resources Agency told DW. Estimates for the amount of oil range from four to 30 billion tons. The latter figure would be equivalent to all of Saudi Arabia's oil reserves.

Resource irrelevant- it’s an entirely a sovereignty issue

Hogue ’12 (9-21 – Platts Asia news editor of energy (Thomas, "Five uninhabited islets and three barren rocks: oil and the dispute over the two China seas," Platts, 9-21-12,, accessed 10-6-12, mss)

In the East China Sea, China has estimated there may be as much as much 160 billion barrels of oil and 210 Tcf of gas, although other estimates run lower. None of the figures mentioned in a US Energy Information Administration report in 2008, however, really jive with an interim report from state-owned CNOOC that shows 300,000 barrels of crude oil and liquids and 6 Bcf of gas produced from East China Sea licenses in the first six months of the year. That’s out of CNOOC’s total domestic output of 105 million barrels of crude oil and liquids and 118.1 Bcf of gas. In short, practically nothing. As well, other oil companies don’t have much faith in the potential of the region. In 2004, Shell and the then Unocal pulled out of contracts to explore for natural gas in the Xihu Trough to the northwest of the Diaoyu-Senkaku islands in the East China Sea, saying that the resources weren’t commercial. The record of futility in the area goes back further, with Taiwan and Japan not having made any significant finds onshore or offshore after spending decades looking for oil and gas resources since the 1970s. The closest significant oil and gas fields of any size lie further to the north and to the west in China’s Bohai Bay. Not really what one would consider highly prospective territory then. What that means is that the dispute over the barren rocky outcroppings in the East China Sea likely has nothing to do with oil and gas, and thus there is no potential commercial gain that might eventually bring China and Japan together in the interest of the mutual economic benefit of jointly exploiting much-needed hydrocarbon resources. And what that means is that as long as each country is claiming that the Diaoyu-Senkaku islands are an “integral partof its territory, periodic eruptions of anti-Japan protests in China and disruption to Japanese businesses there is what can be seen ahead.

SCS de-escalation now- China and regional economics

Jinping ’12 (, 9-21 -- AP staff (Xi, "China Sidesteps South China Sea Island Disputes," AP,, accessed 10-6-12, ms)

China has sought to soothe neighbors it has feuded with over territory in the South China Sea, a stark contrast to recent angry statements and violent street protests targeting Japan over a similar dispute. Vice President Xi Jinping — China's presumed next leader emphasized economic ties and civic exchanges in remarks Friday to delegates from the 10 countries that make up the Association of Southeast Asian Nations. Xi played down South China Sea territorial disputes with the Philippines, Vietnam and others that have flared up again this year. "I hope the situation would not reverse backward and bilateral relations could come back to the track of normal development," Xi told the Philippines' interior and local government secretary, Mar Roxas, according to China's official Xinhua News Agency. In his address at the annual meeting with ASEAN members, held in the southern Chinese city of Nanning, Xi said China was committed to "common development and steadily improving cooperation mechanisms in various fields." With two-way trade growing 20 percent annually to $362.8 billion last year, China and its southern neighbors are increasingly intertwined, requiring even greater cooperation across a range of fields, Xi said. The contrasting approaches to the territorial feuds highlight Beijing's desire to keep the South China Sea disputes in check and avoid drawing in China's chief rival, the United States, which maintains close security ties with many countries in the region. While eager to assert its claims, Beijing needs a peaceful regional environment to achieve its development goals and has a limited capacity to handle multiple diplomatic crises simultaneously.

China is still deterred in the SCS – their evidence is exaggerated

Kania 1/13 [Elsa Kania, The South China Sea: Flashpoints and the U.S. Pivot, 13 January 2013, 2013 Harvard Political Review,]

Equilibrium and Interdependence? One paradox at the heart of the South China Sea is the uneasy equilibrium that has largely been maintained. Despite the occasional confrontation and frequent diplomatic squabbling, the situation has never escalated into full-blown physical conflict. The main stabilizing factor has been that the countries involved have too much to lose form turmoil, and so much to gain from tranquility. Andrew Ring—former Weatherhead Center for International Affairs Fellow—emphasized that “With respect to the South China Sea, we all have the same goals” in terms of regional stability and development. With regional trade flows and interdependence critical to the region’s growing economies, conflict could be devastating. Even for China—the actor with by far the most to gain from such a dispute—taking unilateral action would irreparably tarnish its image in the eyes of the international community. With the predominant narrative of a “rising” and “assertive China”—referred to as a potential adversary by President Obama in the third presidential debate—China’s behavior in the South China Sea may be sometimes exaggerated or sensationalized.

No escalation- China constrained

Dibb, 12 -- ANU strategic studies professor

(Paul, "Why I disagree with Hugh White on China's rise," The Australian, 8-13-12,, accessed 10-5-12, mss)

Hugh White has raised serious questions about how to manage that relationship and, in particular, his view that the US should share power as an equal with China (discussed comprehensively in The Weekend Australian on August 11-12 ). I disagree with much of his analysis and policy prescriptions for the following reasons. First, he exaggerates the dangers in tensions between these two powers and, especially, the risks of conflict leading to nuclear war. He says competition between the US and China will inevitably lead to confrontation and military conflict. That did not happen in the more dangerous Cold War confrontation between the USSR and the US. This was because it was clearly understood on both sides just how destructive a nuclear exchange would be. And yet, White suggests a scenario in which a military incident in the South China Sea could lead to China dropping a nuclear weapon on American military bases in Guam, and the US doing nothing in retaliation. In other words, the US, with more than 5000 strategic nuclear weapons, has backed down and accepted nuclear devastation on its territory with all the precedents that would set. Second, there is little recognition of just how limited China's military capabilities are. It is simply not good enough to accept the pumped-up claims of the US Naval War College that US aircraft carriers are vulnerable to ballistic missile strikes by China. I've heard all these exaggerated views before out of the US. Of course, China is developing some serious modern capabilities but do we actually believe that the US will sit on its hands and do nothing? Unlike America, China has no experience of modern war and much of its military technology is either reverse engineered from Western designs or bought from Russia, which has made no technological breakthroughs for more than 20 years. Ballistic missile attacks on US aircraft carriers from China's mainland would simply invite devastating blows on targets inside China. As for US power sharing and treating China as an equal, why should the US create what former prime minister Paul Keating calls "strategic space" for it? What is being implied here: giving China all the South China Sea or a sphere of influence in Southeast Asia or a free hand to threaten Japan? The fact is that the correlation of forces in our region leaves China with no real friends other than Pakistan and North Korea. Given China's aggressive posture, practically every other major country in the region is moving closer to the US. When China's foreign minister threatens members of ASEAN by stating that "China is a big country and other countries are small countries", he is acting like a bully. Little wonder that China's strategic space is limited. Then there is the question of human rights and asserting, as do both Keating and White, some sort of moral equivalence between US values and those of China. Both seem to imply that because the Communist Party of China has taken hundreds of millions of people out of poverty this somehow cancels out its gross human rights abuses. Let's just remember that China's Communist Party was responsible in the Great Leap Forward and the Cultural Revolution for more than 30 million deaths of its own people. And, in recent memory, this was the party that rolled the tanks over students in Tiananmen Square. There is no way Washington will concede moral equivalence to a communist regime. Finally, what about White's proposal for a Concert of Asia in which China and the US would share power? As he acknowledges in passing, this would risk sacrificing the security of middle and small powers. It must be remembered that in the Concert of Europe in the 19th century middle powers such as Poland either disappeared or were carved up. Just what is proposed here for countries such as Vietnam? Moreover, the Concert of Europe worked because there was a common European culture, which does not exist today in Asia. The fact is that the situation between China and the US is nowhere near as perilous as suggested by Keating and White. Nuclear deterrence and increasing economic interdependence will act as a brake on military adventurism by both sides. Moreover, as Australia's former ambassador to China, Geoff Raby, points out, China is utterly dependent on foreign markets and is in reality a highly constrained power.

Oil triggers all their links

IBTN, 12

(International Business Times News, "South China Sea: Chinese, Philippine And Vietnamese Oil Tenders Escalate Tensions," 8-2-12, l/n, accessed 10-6-12, mss)

South China Sea: Chinese, Philippine And Vietnamese Oil Tenders Escalate Tensions

China has given a go-ahead for its first major tender of oil and gas blocks in the South China Sea, close on the heels of Beijing establishing a military garrison on a disputed island in the waters. China National Offshore Oil Corp (CNOOC), a state oil giant, invited foreign companies in late June to bid on nine oil blocks in territories spread in 160,000 sq km of water, which are also claimed by Vietnam. Companies could decide whether to bid on the blocks until next June, Reuters reported. China lays claim to almost the entire South China Sea, including what is recognized by the U.N. as the exclusive economic zone of other neighbors, the Philippines, Vietnam, Taiwan and Brunei. On July 23, China approved a military command to be based in Sansha City on Woody Island in the Paracels. The city was established June 21 in an area under the Chinese jurisdiction that is also claimed by Vietnam. The garrison was approved as 1,100 Chinese residents elected 45 legislators to the new city's congress. The troops would be ''responsible for managing the city's national defense mobilization, military reserves and carrying out military operations,'' Xinhua news agency reported. Vietnam's state oil firm, Petrovietnam, has condemned Beijing's oil exploration tender, calling it a "serious violation of international law" since the blocks lie well within the country's exclusive economic zone and continental shelf. Hanoi called on energy firms to turn down the offer. It was reported July 20 that India's state-run Oil and Natural Gas Corp (ONGC) would continue its oil and gas exploration in the South China Sea, off the Vietnam coast, ignoring Chinese objection.

AND US has shifted to de-escalation instead of containment- peace settlements will solve

Etzioni, 9-26 -- George Washingtin University internal relations professor

(Amitai, senior advisor to the Carter White House; taught at Columbia University, Harvard and the University of California at Berkeley, "Cooler Heads in the South China Sea," National Interest, 9-26-12,, accessed 10-6-12, mss)

The United States is realizing that the escalating tensions in the Far East, especially between China and Japan, should no longer be viewed as an opportunity to contain China. Instead, our first priority should be to get everyone to calm down. At issue are the territorial rights over some forty piles of rock, most uninhabited, some barely sticking out of the water. These conflicts already have led to large nationalist anti-Japanese demonstrations in China and similar anti-Chinese demonstrations in Japan; saber-rattling activists planting their nation’s flag on some of the islands; and clashes between vessels of several regional nations—all fueled by increasingly hot rhetoric by public leaders. These smaller clashes look increasingly like the type of incidents that can spin out of control and lead to more serious conflagrations. The United States, which keeps veering between seeking to engage China and moves to “contain” it, had at first—at least indirectly—urged the nations of the area to band together and push back against Chinese claims to many of the islands at issue. However, most recently Secretary Panetta called on China and Japan “to move forward and not have this dispute get out of hand” and emphasized that all parties share a responsibility to resolve the conflicts peacefully. And—the ever industrious U.S. think tanks have taken off their shelves a whole host of proposals that could defuse the crisis. Disputes over maritime territorial rights fall under the United Nations Convention on the Law of the Sea (UNCLOS) and should be settled in the International Court of Justice (ICJ). (The fact that the United States did not ratify the treaty involved seems immaterial because Washington typically operates as if it were committed to UNCLOS.) But such settlements take years. In the short term, the think tankers are calling on China and Japan to establish a hotline so that their leaders will be better able to nip in the bud any unintended confrontations. Moreover, both nations are urged to declare unequivocally that “military force is not an option.” A more ambitious plan calls for a return to a derailed 2010 agreement for the joint development of gas fields in the South China Sea. The Economist suggests that the nations involved should do the environment a favor and turn the islands and surrounding seas into marine protected areas to combat overfishing, a problem that seriously threatens the economies and ecology of the region. Douglas H. Paal of the Carnegie Endowment for International Peace points out that to combat overfishing, China, Vietnam and Taiwan have already “initiated fishing seasons, periodic bans, and limits on sizes of catches to support sustainable harvesting, but these are not harmonized and often conflict.” Hence Paal calls “greater control of the fishing fleets, with effective sanctions on misbehavior under rules agreed upon in common, [an] achievable and responsible goal.” One must acknowledge that islands are not fought over simply as real estate but because they serve as markers for determining maritime rights. According to a widely followed reading of international law, a nation’s exclusive economic zone (EEZ) extends two hundred miles off its shores. Thus, if nations can populate and prove ownership over tiny islands in their near seas, they can expand their EEZ and gain access to the surrounding natural resources—not only fish but also coveted fuels and minerals that lie beneath the seabed. Hence, for nations such as China and Japan, whose economies are highly dependent on the secure access to and development of such resources, these islands are much more than “piles of rocks.” In Sharing the Resources of the South China Sea, Mark Valencia, Jon Van Dyke and Noel Ludwig suggest establishing “regional sovereignty” over the islands in the South China Sea among the six claimants, allowing them to collectively manage the islands, territorial seas and airspace. Of course, this would require an agreement among the parties as how to share the spoils. Another option, put forward by Peter Dutton of the Naval War College, would emulate the resolution of the dispute over Svalbard, an island located between Norway and Greenland. The Treaty of Spitsbergen, signed in 1920, awarded primary sovereignty over Svarlbard to Norway but assigned resource-related rights to all signatories. Applying this model to the South and East China Seas likely would entail giving sovereignty to China while permitting other countries to benefit from the resources. Though, at least in the near term, such a solution is unlikely to be accepted by the other claimants. Still others have suggested declaring a moratorium on any exploration until the tensions are defused and conflicts are worked out. And a troika of foreign ministers in the region, including nations not directly involved such as Indonesia and Australia, has been urged to help work out an evenhanded solution. Those who hold that all these suggestions are naive should note that such settlements do take place. One case will have to stand for several others. In 2009, five years after the decades-old dispute was brought to court, the ICJ settled a dispute between Ukraine and Romania over the Black Sea, whose seabed holds an estimated ten million tons of oil. One key issue was whether the Serpent Island would be considered a cliff or an island. The Romanians claimed it was “a cliff” (hence irrelevant to territorial demarcation) while Ukraine held it was “an island” and thus that Ukraine’s maritime boundaries extended beyond Serpent Island’s shores. The ICJ ruled it a cliff and delivered a judgment that granted Romania about 80 percent of the disputed area (though the oil was more concentrated on the Ukrainian side). Both sides accepted the decision. If cooler heads prevail and Washington continues to throw its weight in support of tensions reduction and conflict resolution by negotiation, some of these proposals or others like them may carry the day. All sides surely realizegiven the fragile state of the global economy, the political transition in China, the rise of nationalism that threatens to spin out of control—that this is a particularly poor time to escalate tensions.

Wont escalate—tensions are bluffs for negotiating leverage

Gupta ’11 (10/23 Rukmani Gupta, Associate Fellow at the Institute for Defence Studies and Analyses,10/23/11, South China Sea Conflict? No Way,

Despite what opinion pieces in the Global Times may say, there’s reason to suspect that China doesn’t want to escalate conflict in the region. Although commentary from the United States has suggested that China considers the South China Sea a ‘core interest,’ no official Chinese writing can be found to corroborate this. In addition, China’s caution can also be seen as a reflection on Chinese military capabilities, which aren’t seen as strong enough to win a war over the South China Sea. In fact, the China National Defence News, published by the Chinese People’s Liberation Army’s General Political Department, has likened the use of force by China in the South China Sea to shooting one’s own foot. Not only would the use of force bring ASEAN together on the issue, it could conceivably involve the United States and Japan, derail China’s plans for continued economic growth and undo China’s diplomacy. Chinese declarations on the South China Sea can therefore be seen as attempts to exaggerate claims so as to secure a better negotiating stance.

1NC Manufacturing

Too many alt causes to manufacturing

Lewis 10/19/12 – Staffwriter (Lewis, Matt K. “ The incredible shrinking manufacturing sector.” 19 October 2012.

During the second presidential debate, President Obama echoed those lyrics. Today, only 9 percent of Americans work in manufacturing jobs. American industry has declined on Obama's watch — something he readily admits to. During Tuesday night's debate, he channeled Springsteen, saying that "some jobs are going, and won't be coming back." Part of this is unavoidable. It has to do with globalized markets and outsourcing. The obvious benefits of high productivity and low wages overseas is irresistible to many businesses. It has to do with immigration and technology. Meanwhile, American industry is becoming more productive and efficient — a good thing, except that it means we can create more stuff with fewer workers. The good news, the president tried to reassure us, is that the void left by these disappearing manufacturing jobs will be filled by high-paying, high-skills occupations. Whether that's true or not, there's an obvious point he did not state: Many Americans will be left behind in the process. As the world changes, some people simply can't — or won't — adapt. And the president's vision leaves those Americans behind. Manufacturing jobs were once the cornerstone of American industry. You could graduate from high school (or not) and get a job in a factory that would pay you enough money to support a middle-class family. However, during the Reagan era, manufacturing declined significantly, setting in motion a trend that lasted through both Bush administrations as well as the Clinton administration. This isn't a Republican or Democratic problem. There's plenty of bipartisan blame to go around.

Manufacturing not key to the economy

Chapman, 12 -- Tribune editorial board member

(Steve, "Manufacturing an economic myth," Chicago Tribune, 3-18-12,, accessed 10-3-12, mss)

Manufacturing accounts for a shrinking slice of the total economy mainly because as we grow wealthier, we spend a smaller portion of our income on physical products, like carsand appliances, and a bigger one on services, from health care to cellphone contracts to restaurant meals. That phenomenon holds across the developed world. It's the result of the free market at work, endlessly shifting resources to accommodate changes in consumer demand. Politicians don't think they should tell Americans to eat at Burger King instead of Chipotle, or buy baseball bats instead of soccer balls. They didn't insist we keep our typewriters when personal computers came along. For the most part, our leaders take it as normal and sensible to defer to consumer demand, rather than try to dictate it. Given that, why do they think they ought to rig the tax code to push consumption dollars from services, which Americans want, to goods, which they don't want quite so much? Why should they divert investment from more popular businesses to less popular ones? That's what the measures offered by Santorum and Obama would do. The point is to ease the tax burden of manufacturers at the expense of other companies, on the superstition that the former are more valuable than the latter. It's hard to see the fairness or the economic logic. When the president unveiled his proposal, Jade West of the National Association of Wholesaler-Distributors complained to The New York Times, "My guys are totally freaked out by manufacturing getting a different tax rate than we do. They're not more important in the economy than retail or distribution or anything else." In fact, manufacturing is bound to be a diminishing share of any advanced economy. Obama and Santorum can fling money into the teeth of that trend. But any time politicians want to resist powerful and beneficial economic forces, bet on the economic forces.

1NC Chemical Industry

Environmental regs biggest i/l to collapse the chem industry

Shannon 10

Mike, Global and US Sector Leader Chemicals and Performance Technologies, “The Outlook for the US Chemical Industry” KMPG

US chemical companies are also concerned with the Regulation on Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) implemented by the European Union (EU). While this regulation has no effect on US soil, US producers exporting an additive or solvent or other substances for use by an EU manufacturer may find their product within REACH jurisdiction. 66 The European Commission has estimated that the direct costs of REACH to the chemical industry will total US$2.8 billion over the first 11 years of the regulation. 67 In the US, mechanisms to limit carbon and other greenhouse gas (GHG) emissions have the greatest potential to influence the chemical industry. Existing US cap-and-trade programs include: • Acid Rain Program (part of the 1990 Clean Air Act) • NOx Budget Trading Program (first administered in 2003) • Clean Air Interstate Rule which uses a cap-and-trade system designed to reduce sulfur dioxide and nitrogen oxides nationwide by 70 percent 66 Chemical News & Intelligence: ‘Costs of EU chemical regulations reach US businesses,’ February 17, 2010 67 European Commission: ‘REACH in Brief,’ October 2007 • Regional Greenhouse Gas Initiative, a market-based effort by ten northeast and mid-Atlantic states to limit GHG emissionsMidwestern Greenhouse Gas Reduction Accord and the Western Climate Initiative in which US states and jurisdictions in Canada and Mexico are designing regional cap and-trade programs

EPA monitoring regs crush the chem industry

Shannon 10

Mike, Global and US Sector Leader Chemicals and Performance Technologies, “The Outlook for the US Chemical Industry” KMPG

New EPA regulations also carry a heavy price tag for compliance. On September 22, 2009, the EPA finalized the Mandatory Greenhouse Gases Reporting Rule, which includes reporting for a wide range of public and industrial sources. 70 Many chemical companies will be required to install some sort of monitoring devices, some of which will cost US$40,000 – 80,000 per emissions point, according to some estimates. 71 The EPA estimates that compliance with the new rule will cost the private sector US$115 million in 2010, and US$72 million per year thereafter. 72 The ACC predicts that the compliance cost for companies will be much higher, based on the costs of installing the monitors and the added costs of gathering data for reports to the EPA. 73

Global warming regulations are weakening the chemical industry.

Lammey ‘8

Alan Lammy, Oil and Natural Gas Futures Analyst. May 5, 2008. Natural Gas Weekly. “Chemical Business-Cycle Downturn Could Be Bearish for Gas Market”. Lexis.

"There are more and more regulations forced upon the industry as a consequence of newly developed climate-change policies," another industry director said. "And, of course, the industry will have to live with high oil and natural gas prices for the foreseeable future. The profitability of the chemical industry has always been held captive to the domestic and worldwide economies, plus the cost of its feedstock oil and gas. We're already starting to see a slow down for our products. So as we slow our production accordingly, it will undoubtedly put more natural gas supply back on the market."

1NC Pakistan Impact

No Pakistani collapse

AP ‘10

“Pakistan's stability, leadership under spotlight after floods and double dealing accusations,” August 6th,

Not for the first time, Pakistan appears to be teetering on the edge with a government unable to cope. Floods are ravaging a country at war with al-Qaida and the Taliban. Riots, slayings and arson are gripping the largest city. Suggestions are flying that the intelligence agency is aiding Afghan insurgents. The crises raise questions about a nation crucial to U.S. hopes of success in Afghanistan and to the global campaign against Islamist militancy. Despite the recent headlines, few here see Pakistan in danger of collapse or being overrun by militants — a fear that had been expressed before the army fought back against insurgents advancing from their base in the Swat Valley early last year. From its birth in 1947, Pakistan has been dogged by military coups, corrupt and inefficient leaders, natural disasters, assassinations and civil unrest. Through it all, Pakistan has not prospered — but it survives. “There is plenty to be worried about, but also indications that when push comes to shove the state is able to respond," said Mosharraf Zaidi, an analyst and writer who has advised foreign governments on aid missions to Pakistan. "The military has many weaknesses, but it has done a reasonable job in relief efforts. There have been gaps in the response. But this is a developing a country, right?" The recent flooding came at a sensitive time for Pakistan, with Western doubts over its loyalty heightened by the leaking of U.S. military documents that strengthened suspicions the security establishment was supporting Afghan insurgents while receiving billions in Western aid. With few easy choices, the United States has made it clear it intends to stick with Pakistan. Indeed, it has used the floods to demonstrate its commitment to the country, rushing emergency assistance and dispatching helicopters to ferry the goods. The Pakistani government's response to the floods has been sharply criticized at home, especially since President Asif Ali Zardari departed for a European tour. With so many Pakistanis suffering, the trip has left the already weak and unpopular leader even more vulnerable politically. The flooding was triggered by what meteorologists said were "once-in-a-century" rains. The worst affected area is the northwest, a stronghold for Islamist militants. Parts of the northwest have seen army offensives over the last two years. Unless the people are helped quickly and the region is rebuilt, anger at the government could translate into support for the militants. At least one charity with suspected links to a militant outfit has established relief camps there. The extremism threat was highlighted by a suicide bombing in the main northwestern town of Peshawar on Wednesday. The bomber killed the head of the Frontier Constabulary, a paramilitary force in the northwest at the forefront of the terror fight. With authorities concentrating on flood relief, some officials have expressed concern that militants could regroup. The city of Karachi has seen militant violence and is rumored to be a hiding place for top Taliban and al-Qaida fighters. It has also been plagued by regular bouts of political and ethnic bloodletting since the 1980s, though it has been calmer in recent years. The latest violence erupted after the assassination of a leading member of the city's ruling party. More than 70 people have been killed in revenge attacks since then, paralyzing parts of the city of 16 million people. While serious, the unrest does not yet pose an immediate threat to the stability of the country. Although the U.S. is unpopular, there is little public support for the hardline Islamist rule espoused by the Taliban and their allies. Their small movement has been unable to control any Pakistani territory beyond the northwest, home to only about 20 million of the country's 175 million people.

The army will maintain control even during a coup.

Cheema ‘8

Pervaiz Iqbal Cheema, works for the Islambad Policy Research Institute. “Pakistan's nuclear assets”. March 16, 2008.

Turkish military chief’s statement appears to reflect the need to support and strengthen Pakistan with a view to enable Pakistan to maintain tight control over its nuclear assets. A weak and unstable Pakistan could create opportunities for undesirable elements to capitalise on the situation in order to realise their aims and objectives. Alternative interpretation is that General Buyukanit was highlighting the creeping dangers in the light of Western interpretation of the situation. Given the incumbent situation, which is certainly not all that rosy, the Turkish general stressed that if President Musharraf lost his grip on Pakistan, the country could fall into the hands of the insurgent Taliban. What seems to be rather intriguing is the attention attached to the abilities of the Taliban to gain control. To some of us it seems somewhat exaggerated. Besides, such interpretations totally ignore the abilities of the Pakistan Army to protect its assets. Admittedly, the Taliban has made gains during the last few months, which are primarily the product of Isaf/Nato’s failure in Afghanistan, but this does not mean that with the resurfacing of the Taliban the Pakistan Army has lost its abilities to handle them.

No impact or risk from Pakistani loose nukes

Mueller ’10 – professor of political science at OSU

John Mueller, professor of political science at Ohio State University, Calming Our Nuclear Jitters, Issues in Science & Technology, Winter 2010, Vol. 26, Issue 2

The terrorist group might also seek to steal or illicitly purchase a "loose nuke" somewhere. However, it seems probable that none exist. All governments have an intense interest in controlling any weapons on their territory because of fears that they might become the primary target. Moreover, as technology has developed, finished bombs have been outfitted with devices that trigger a non-nuclear explosion that destroys the bomb if it is tampered with. And there are other security techniques: Bombs can be kept disassembled with the component parts stored in separate high-security vaults, and a process can be set up in which two people and multiple codes are required not only to use the bomb but to store, maintain, and deploy it. As Younger points out, "only a few people in the world have the knowledge to cause an unauthorized detonation of a nuclear weapon." There could be dangers in the chaos that would emerge if a nuclear state were to utterly collapse; Pakistan is frequently cited in this context and sometimes North Korea as well. However, even under such conditions, nuclear weapons would probably remain under heavy guard by people who know that a purloined bomb might be used in their own territory. They would still have locks and, in the case of Pakistan, the weapons would be disassembled.

1NC Geopolitics/Iran Power

Iran’s military power is exaggerated.

Aghsan and Jakobsen ‘10

Ali Rahigh-Aghsan is Assistant Professor at the Department of Society and Globalisation, Roskilde University and Peter Viggo Jakobsen is Associate Professor at the Department of Political Science, University of Copenhagen. “The Rise of Iran: How Durable, How Dangerous?”. The Middle East Journal, Volume 64, Number 4, Autumn 2010, pp. 559-573. Project Muse.

Accounts of Iran’s growing military power generally fail to place it within a regional context, ignore the poor quality of Iran’s equipment and manpower, and exaggerate its offensive and political potential. If one merely looks at numbers, the Iranian military appears quite formidable, enjoying advantages in both manpower and materiel. However, this picture changes once defense spending and the quality of the armed forces are taken into account. Iran has been outspent massively by the six members of the Gulf Cooperation Council (GCC): Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE). These countries spent 7.5 times as much on their defense as Iran in the ten-year period 1997–2007; with respect to procurement, the difference is even more dramatic as the GCC spent 15.6 times as much on arms as Iran during the period of 1988–2007. The armed forces of the GCC consequently have far better equipment than Iran. The GCC has a total of 495 and 1,816 high-quality combat aircraft and tanks, respectively, compared to Iran’s 55 high-quality combat aircraft and 730 tanks. Saudi Arabia alone has more high-quality combat aircraft and tanks than Iran. The GCC also has more major naval combat ships than Iran in all categories, except submarines (Iran has three, while the GCC possess none).11 Iran’s manpower advantage also disappears when quality is taken into account: 220,000 of its 545,000 active personnel are made up of 18-month conscripts that receive only three months of military training. Moreover, GCC training cooperation with France, the UK, and the US helps to further enhance their qualitative advantage vis-à-vis the Iranian armed forces, which do not benefit from such cooperation with leading military powers. There is obviously more to military power than quantity, and the GCC countries are incapable of using their capabilities jointly in an effective manner to counter an Iranian attack. The key point to take away from the balance of forces just presented, however, is that the GCC countries are strong enough to deny Iran a quick and decisive victory, giving the US time to bring its superior air- and sea-power to bear against Iranian attackers. This makes an overt Iranian conventional attack on the GCC countries next to unthinkable and significantly reduces Iran’s ability to coerce the GCC militarily.12 The regime’s best offensive cards are consequently the Navy’s ability to close the Strait of Hormuz13 and the 125,000-strong Islamic Revolutionary Guard Corps’ (IRGC) potent capacity for asymmetric warfare and terrorist activities.

No Russia threat – rapprochement coming now

Laqueur ’10 – Director of the Wiener Library Institute of Contemporary History

Waliter, Director of the Wiener Library Institute of Contemporary History, in London, and Chair of the International Research Council at the Center for Strategic and International Studies, Moscow's Modernization Dilemma: Is Russia Charting a New Foreign Policy?, Nov/Dec Foreign Affairs, Proquest

It seems gradually to have dawned on at least some Russian strategic thinkers that nato in its present form does not really present a major threat to Russia or, perhaps, to anyone. (According to Russian Foreign Minister Sergey Lavrov, nato is no longer a threat, only a "danger," which is presumably less than a threat.) Nato member states have shelved the idea of offering admission to Georgia and Ukraine. At the same time, Washington, following the European example, has toned down its criticism of Russian violations of human rights and lessened its support for domestic opposition groups in Russia and Westernleaning states such as Georgia, which Moscow regards as hostile threats. From Moscow's perspective, the West has largely accepted Russia's claims to a zone of privileged interests-whatever the fears of Russia's neighbors, there is little Western countries can do to help. In short, the West's relative weight is declining, but so is Russia's, making a policy of rapprochement appealing for all sides. For Moscow, this new, conciliatory approach is largely focused on economic and, above all, technological modernization. The emphasis of a position paper prepared by the Russian Foreign Ministry and published by Russian Newsweek in May 2010 was almost entirely such modernization. It outlined how Moscow should improve its relations with more than 60 countries, from Brunei to Mongolia, using measures including state treaties and agreements between research institutes. The document-and the new policy-appears to be based on a compromise between various elements in the Russian leadership. President Dmitry Medvedev's faction, which seems to be behind this statement, is clearly willing to take some more risks; it is also possible that Medvedev's supporters are using the argument of modernization to sell a broader policy of détente to various domestic constituencies. The moderate conservatives, such as Prime Minister Putin; his deputy chief of staff, Vladislav Surkov; his deputy prime minister, Igor Sechin; and his foreign policy adviser, Yuri Ushakov, understand that Russia's dependence on oil and gas exports must be reduced and that modernization will inevitably involve a political price-but they are fearful that the price could be too high. Meanwhile, both the right (Russia's ultranationalists) and the left (the Communists) are not, in principle, against modernization but would like it to happen without any political price at all. The new détente has shown itself in a number of cases: Russia's voting for un sanctions against Iran, expressing remorse about the Katyn massacre, reaching an agreement with the United States to reduce nuclear weapons, inviting nato soldiers to march on Red Square on Victory Day, being offered warships from France, proposing a Russian-EU crisis management agreement, and some others. But there are difficulties ahead-old suspicions and new conflicts of interest will not easily be overcome, and may even derail the new course, just as the détente of the 1970s came to a halt despite goodwill on both sides. In August, Putin said that his anti-Western speech in Munich three years ago had been very useful in retrospect. If so, then how far can the changes in Russia's foreign policy be expected to go?

No impact to regionally strong Russia

Grigoryan '12

Suren, political analyst who worked for the Ministry of Defense of Armenia for 10+ years, Masters Degree in Comparative Politics at the London School of Economics and Political Science, "U.S.-Russia: My Enemy, My Partner?" Foreign Policy Journal, 1/15/12, AD 5/22/12

All this is in the past, official Washington says. As President Barack Obama put it in 2009 during his visit to Moscow, America wants to see Russia strong, peaceful, prosperous, and self-confident, because the United States needs exactly this kind of partner in the twenty-first century. The words of U.S. Ambassador to Russia John R. Beyrle on the same subject are even more emotional: “We are not interested in weak Russia. Weak Russia is the worst nightmare for the US. We understand perfectly what challenges we are faced with…and we must cope with them in alliance with strong partners. Thanks to its geostrategic position, immense resources and human capital, Russia may be exactly…such a partner”.[15] Indeed, Russia has the historical experience, the human and material resources, and the political will necessary for controlling and even managing regional processes. However, is Russia comfortable with the role of “regional regulator” after being a global actor for 150 years? Most probably it is. First, it has learned to assess its capabilities realistically, especially in the economic sphere, and it understands perfectly its subordinate position compared to other rising powers of Eurasia, let alone the United States. Secondly, it has not only offered to coordinate the situation in the post-Soviet space, but also to become a rightful (in some cases even irreplaceable) mediator in solving the most acute problems with neighboring regions (the Middle East, Central Asia) and states (Iran, North Korea, and others), which contemporary Russian strategy considers extremely important in terms of the country’s national security interests. Furthermore, under the circumstances, when Russian political thought continues searching for a new geopolitical identity, even the role of regional regulator not only satisfies Russia’s imperial ambitions but also facilitates the realization of the post-Soviet area integration project within the Eurasian Economic Community (EAEC).[16] However, the question arises, why does the United States need Russia to realize its imperial ambitions? The most obvious reasons are as follows: First, Russia is capable and willing to assume the role of regional regulator. Throughout the last 20 years (i.e., after the collapse of the Soviet Union), Moscow has de facto played the role of regional coordinator, despite Russia’s economic chaos, political reorganization, weakness of its central government, and demoralization of its armed forces in the 1990s. Russia continued holding the keys to resolution or at least freezing of regional interethnic (the South Caucasus, Transdnistria) and civil conflicts (Tajikistan, Uzbekistan, Kyrgyzstan) in the post-Soviet area. Moreover, the states that have had acute conflicts with the West (e.g., Iran, North Korea) were always more willing to have contact with Russia rather than other powers; even the most radical movements of the Arab East continue maintaining contacts with her. Today, when Russia has overcome (although with tremendous material, moral, and political losses) one of the most difficult periods of her history—when the power vertical has been rebuilt, significant financial recourses have been accumulated allowing the country to proceed with economic and technological modernization, and the armed forces are reviving—it is more beneficial for the United States to have Russia as a partner rather than a rival in the extremely complicated region of Eurasia. Americans have not forgotten the many unexpected problems they were faced with after the demise of the USSR: the WMD proliferation threat, uncontrolled trade of conventional weapons, separatism, illegal drug trafficking, terrorism, human trafficking on an immense scale, and so forth. Most of these remain serious issues even today. Among all countries pretending to regional leadership, only two have enough historical experience and appropriate capabilities for solving these problems—namely, Russia and China. However, China still refrains from partaking in solving such issues (perhaps except through mediation in negotiations with North Korea). Some experts insist that this is because Beijing is still mainly focused on expanding its potential.[17] As for our judgment, perhaps arguably enough, Chinese political culture is less predisposed to expansionism, whereas it still dominates in Russia. This is exactly the reason the role of regional “gendarme” suits her mentality very well, as it in essence remains imperial. Second, economically, Russia is much weaker than the European Union or China. Given this fact, the United States’ desire to see Russia in a position of regional political manager appears quite logical. Given its economic and technological weakness, Russia in the foreseeable future will not be able to compete with the U.S. on a global scale. Meanwhile, Europe and China can definitely do so. As for Russia’s nuclear potential, which is still comparable with America’s, it is hardly a source of serious concern for the only world superpower. In contrast to the nervous “dilettantes” that are present on the nuclear scene, Moscow has been a tested, predictable, and responsible partner-adversary since Cold War times. For this reason, it is much more beneficial and also easier for Washington (and acceptable for Moscow) to channel their military might—the world’s biggest arsenals of nuclear arms—toward deterring such dilettantes instead of exerting pressure on each other. If such consensus between Washington and Moscow is achieved, Russia, with its nuclear potential, may acquire a new function: as a balancing force between Eastern and Western, and Northern and Southern parts of the vast Eurasian continent.

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