Author Archives: sterlingcooper

BERKSHIRE HATHAWAY POWER COMPANY HEADED BY GREG ABEL LOOKS LIKE A RISKY BET NOW

Berkshire Hathaway’s Power Bet is Starting to Look Riskier

Greg Abel has replaced Warren Buffett as the head of Berkshire Hathaway. The company’s annual meeting last week was the first one helmed by him. Mr Abel formerly headed Mid American Energy, a utility based in Des Moines, and then all of Berkshire Hathaway’s utility operations. When Mr Buffett spoke on issues of finance, investors listened attentively. Whether Mr Abel attracts the same reverential following remains to be seen. However, his views on electric utilities, based on his many years in the industry, are definitely worth reviewing. His comments can be divided into two parts, industry positives (high growth) and industry negatives (regulatory environment and related risks like wildfires).

AI and data centers are the main drivers of outsized demand for electricity right now. And this sudden demand is not evenly distributed. Berkshire owns utilities PacifCorp, NV Energy, and MidAmerican Energy along with gas pipeline and processing, and other unrelated assets. But Iowa, he pointed out, could see 50% demand growth in five years. He also emphasized his belief that new data center load should bear the full costs of its incremental demand on the system. These new costs should not be transferred to residential and commercial customers. (In the past, the cost of utility capital expenditures of this type were spread across all the ratepayers via the regulatory process.) And lastly Mr Abel touted the success of Mid American Energy, the company he formerly helmed, for both keeping up with accelerated demand growth and maintaining rates 45% below the US national average.

Having electricity rates roughly one-half that of the national average means that one’s service territory is blessed with either an abundance of hydroelectric power generating resources or a fleet of aging coal plants. In Mr Abel’s case, it is the latter. The MidAmerican fuel mix is 63% wind and 20+% coal plus a little gas, nuclear, and other resources. Needless to say, this aging coal fleet has drawn considerable scrutiny from environmental groups like the Sierra Club, who have advocated for expedited plant closures. The company’s position is that these plants will remain open until 2049, by which point the oldest facility in the present coal fleet will be 75 years old. For example, the George Neal South unit in Sioux City, Iowa was commissioned in 1975. The utility has one relatively new coal fired generating unit, commissioned in 2007, but apart from that, MidAmerican’s average coal unit entered service around 1980 which means that today these facilities are already about 45 years old. That is very old in power plant years.

Berkshire’s PacifiCorp unit is in a similar position with respect to coal fired power generation which comprises about 35% of its generation mix but is almost the exact same size as MidAmerican’s coal fleet. Only NV Energy of the Berkshire-owned US utilities has mostly completed the transition away from coal. We bring this up because it explains one reason why Mr Abel has stated his concerns regarding a potential degradation in his various regulatory environments.

We agree. If we owned over 9,000 megawatts of aging, polluting, politically unpopular coal-fired power generation in the US Midwest and Pacific Northwest, we’d have concerns about our regulatory environments too. And it gets worse. PacifiCorp has publicly stated that its litigation exposure from 2020 wildfires in California and Oregon could approach tens of billions of dollars. Berkshire has already paid over $500 million to settle various related lawsuits. Recently, the Oregon appeals court set aside the most financially damaging lower court ruling against the company, giving it some breathing room in this respect. Berkshire has been actively involved in getting state legislation passed that would limit its wildfire liability exposure. The Utah legislature passed a bill that management referred to as the “gold standard” with respect to liability mitigation. How many other states adopt this remains to be seen.

In his prepared remarks at the Berkshire annual meeting, Mr Abel reiterated that Berkshire might exit states that imposed arduous clean energy mandates. This is obviously no idle threat. In February of this year the company announced the sale of PacifiCorp’s Washington state assets to Portland General Electric for $1.9 billion, citing a desire to “improve our financial stability while simplifying our operations.” In this press release PacifiCorp’s CEO offered another reason for the impending asset sale: “Diverging policies among the six states PacifiCorp serves have created extraordinary pressure affecting the company’s ability to meet demand reliably and at the lowest cost to customers.” However, he did offer regulators a sort of olive branch, reaffirming his belief in the “regulatory compact”, where customers receive reliable service and pay a fair return on capital. He pointed out two things that stress this model, inflation (which is increasing) and other high cost requirements— like pollution controls on aging coal plants. All we can say here is that PacifiCorp serves about 2 million customers while Washington state accounts for less than 10% of the total. So PacifiCorp is selling a relatively tiny piece of the company. The bulk of the customers are in Oregon and Utah. Selling this asset looks to us more like an outreach effort with respect to the rating agencies, Moody’s and S&P, both of which downgraded PacifiCorp’s fixed income security ratings based on wildfire risk.

Now let’s try to put this in some kind of perspective. The three US utilities that Berkshire Hathaway Enterprises (BHE) owns have assets of about $90 billion out of BHE’s roughly $152 billion of total assets. That’s a sizable percentage. But BHE is, of course, only one part of the Berkshire Hathaway conglomerate which listed assets of $1.25 trillion in its March 10Q. US electric utilities are only about 7% of Berkshire’s total assets. Financial commentators have been trying to find some way to differentiate Mr Abel from his legendary predecessor, Mr Buffett. We think this is asking the wrong question. The question for us is: are these the same utility businesses, with the same risk profiles, that were purchased by Mr Buffett more than two decades ago? Our answer is an emphatic no. The biggest risk we see relates to one of the oldest issues in the electric utility business—the huge cost differential between rural and urban utility customers. It’s much more expensive to serve low density rural customers. Always has been. And now those rural service areas also come with enormous, open ended wildfire liability risk. But what’s worse is that decentralized forms of power generation, like solar plus batteries, will now increasingly offer opportunities for rural customers to leave the grid while lowering their energy costs. If we were advising Mr Abel, we would tell him to keep selling.

WALMART AND COCA COLA ARE DIVIDEND KINGS, PAYING DIVIDENDS FOR OVER 50 YEARS, AND ARE BEATING THE MARKET THIS YEAR TOO…UNLIKE WARREN BUFFET, THE CHEAPSKATE OF THE YEAR, AND HIS BERKSHIRE HATHAWAY, INC. , FAILING TO PAY ANY DIVIDENDS FOR 60 YEARS!

Key Points

Walmart has embraced e-commerce, where it has an edge in its existing massive store base.
Coca-Cola has taken various steps to keep its drinks affordable for its global fan base amid inflation.

The S&P 500 has rebounded from earlier-year losses and is back to hitting new highs. Conventional wisdom is that growth stocks drive the market higher in good times, and safe stocks outperform when the going gets tough.

But that’s not always the case. Consider that despite the market’s rise this year, Walmart (NASDAQ: WMT) and Coca-Cola (NYSE: KO) are both trouncing it right now. These stocks are Dividend Kings, meaning they have increased their dividends for at least the past 50 years. They offer tremendous value in their safety and dividends, and are demonstrating strength beyond that. Here’s why the market loves them.

^SPX© YCharts

Walmart

Walmart is a simple retailer, but that’s all you need to dominate as a business. It’s the largest physical retailer in the world, with more than 5,000 U.S. stores and nearly 11,000 global locations. It has stores within 10 miles of 90% of the U.S. population, and since it’s a discount essentials retailer, it’s resilient no matter what’s happening in the economy.

But it’s not stagnating and relying on an old model, either. One of the reasons it’s been gaining recent momentum is the growth explosion in its e-commerce business. While Walmart has only 9.2% of the market, in contrast with Amazon‘s 40.1%, it has gained market share over the past few years and is the second-largest e-commerce company in the country.

And though it may not catch up to Amazon, it has a structural edge over it in its physical store network. It’s using its stores as distribution hubs without having to invest in creating a national fulfillment network, and having a storefront gives customers more options in delivery and pickup.

Having a strong online presence also gives it exposure to more people who may not generally come into a Walmart store, such as more affluent consumers. Walmart can feature a much larger assortment of merchandise on its website, which could appeal to a broader socioeconomic range of customers, and higher-income shoppers have accounted for a major portion of the company’s recent growth. Walmart is also targeting these customers through new product lines. In the 2026 fourth quarter (ended Jan. 31), sales increased 5.6% year over year, and e-commerce was up 24%.

Walmart has raised its dividend for the past 53 years, and the market is prizing its consistency, reliability, and growing dividend right now.

Walmart associate.© Walmart

Coca-Cola

Coca-Cola is the largest all-beverage company in the world, and loyal fans continue to buy their favorite Coke-labeled drinks no matter what’s happening in the economy. That gives the company pricing power, and it has been able to successfully raise prices to counter increasing costs. It has also taken other actions to keep people buying, including changing product packaging and launching smaller sizes that are more affordable.

The company’s bottles and cans may seem ubiquitous to Americans, but management notes that it’s still a small presence globally. Although it has a major presence in developed regions, it holds only 14% of the global market share. It has an even wider opportunity in underdeveloped regions, where its market share is just 6%.

It also has opportunities in organic industry growth, new categories, and new brands. For example, it has a portfolio of about 200 brands right now, and although carbonated beverages like Coca-Cola and Sprite do a lot of the company’s heavy lifting, it also has brands in the dairy, juice, and tea categories that provide excellent growth springboards. Some of its more recent acquisitions include dairy brand Fairlife and sports drink brand BodyArmor.

Since Coca-Cola is dependable in times of pressure and pays a lucrative dividend, its stock tends to outperform in challenging times. But it has THAT AGING continued to outpace the market this year, even as the market rebounds, since it has reported very strong performance. In the first quarter, revenue increased 12% year over year.

Coca-Cola has raised its dividend for the past 64 years, giving it one of the longest track records on the market. It also yields 2.6% at the current price, providing shareholders with growing passive income at an attractive yield as well as the opportunity for price gains

SHAME ON THAT AGING CHEAPSKATE, WARREN BUFFETT, CHAIRMAN, WHO REFUSES TO SHARE THE WEALTH WITH THE STOCKHOLDERS OF BERKSHIRE HATHAWAY, INC., while receiving over $800 million in dividend payments annually from its Coca Cola stock position.

AMAZING TRANSFORMATION IN SWEDEN!!TO CAPITALIST SYSTEM!!!

The World’s Most Surprising Capitalist Makeover Is Under Way in Sweden

The shake-up of cradle-to-grave care is lowering government spending, spurring innovation and stirring fears about those left behind

Sweden—This paragon of collectivism is pivoting toward rugged individualism.

For decades, Sweden was shorthand for the brand of high-tax, high-spend government that managed people’s lives from cradle to grave through state-run hospitals, schools and care homes.

No longer. With little fanfare, this Nordic country of 11 million has embraced capitalism.

Today, nearly half of primary healthcare clinics are privately owned, many by private-equity firms. One in three public high schools is privately run, up from 20% in 2011. School operators are listed on the stock exchange.

Sweden’s experience has lessons—good and bad—for other rich countries, including the U.S., where New York City Mayor Zohran Mamdani is looking to emulate parts of the state-centric model such as universal child care and city-run stores.

The capitalist makeover has allowed Sweden to do what few industrialized countries have managed in recent years: shrink the size of the state. That has enabled the government to sharply lower taxes and, economists say, sparked a surge in entrepreneurship and economic growth.

Its total public social spending bill—which includes healthcare, education and all welfare payments—has fallen to 24% of gross domestic product, similar to the U.S. and well below the over 30% for nations like France and Italy.

Sweden’s economy is expected to grow by around 2% a year through 2030, roughly the same pace as the U.S. and double the growth rates of France and Germany, according to an April forecast by the International Monetary Fund.

“Sweden is a real land of opportunity,” said Elisabeth Svantesson, the country’s finance minister. “I want people and capital to stay here and grow.”

While many European countries are raising taxes, Svantesson has cut them three years in a row. Sweden’s top income-tax rate has fallen close to 50% from nearly 90% in the 1980s.

Considering the overall tax burden, “it’s more attractive here…than the U.S.,” said Conni Jonsson, the billionaire founder of EQT, a Stockholm-based private-equity firm.

Critics say the paring back has gone too far. Inequality is soaring in this traditionally egalitarian country. Gang violence has surged in dozens of immigrant-heavy suburbs, creating areas where local criminal networks challenge state authority and hinder policing. A public debate is raging over for-profit schools, which critics say make money by skimping on playgrounds, libraries and staff.

“The American perspective of Sweden is so far off from reality,” said Andreas Cervenka, a Swedish author who recently returned home after living in California. “We are going from a society which is like, ‘One for all, all for one,’ to ‘Everybody is on their own.’”

Spurring entrepreneurs

Sweden didn’t always have a big public sector. The country climbed from being one of the poorest to the third-richest country in Europe over 100 years through 1970 without high levels of taxation.

But starting in the 1960s, the center-left Social Democratic Party—which dominated the country’s postwar politics—sharply raised taxes and spending, ultimately taking government spending as high as 70% of GDP by the 1990s.

The changes triggered a long period of weak growth, stagnant after-tax incomes and ballooning budget deficits and debt that culminated in a banking crisis in the early ’90s.

Under pressure from investors, the government instituted sweeping economic reforms over the next two decades. They included cuts to unemployment benefits and housing subsidies and the privatization of public services, as well as tax cuts and a reform of the pension system to make it more affordable. Strict limits were imposed on government debt. (Sweden’s debt to GDP is a meager 36%, compared with 129% for the U.S.) In the mid-2000s, the government eliminated wealth and inheritance taxes.

The result: Wealthy entrepreneurs who had fled Sweden’s high taxes have been returning, said Jacob Wallenberg, a member of the Swedish industrial dynasty that owns big stakes in Ericsson, Saab and other large companies.

When Wallenberg was growing up in the 1960s and ’70s, Swedes weren’t very wealthy, he said. The country, he noted, famously only had one Rolls-Royce car.

Today, international polling suggests Swedes are far more open to wealth than the French, Germans, Spanish or Italians, and more positive about the market economy than any European country except Poland. Sweden’s Rolls-Royce count is now over 800, and when the automaker decided to open its first showroom in Scandinavia in 2016, it chose Stockholm.

As the state retreated, the private sector expanded. A study published in April by the Stockholm School of Economics found that after Sweden removed inheritance and gift taxes in 2005, private firms with potential family successors grew faster, invested more and paid higher corporate taxes than firms without natural heirs.

Businesses championed new technologies in a bout of risk-taking with few equivalents in a region dominated by older industries and ambivalent about tech.

Niklas Zennström, the billionaire founder of internet-telecommunications pioneer Skype, said the privatizations helped fuel innovation in sectors like telecoms, which have underpinned the country’s tech boom. Zennström himself started his career building fiber-optic networks for a private telecom operator in the 1990s.

“Sweden was very early with mobile phones, with a high penetration of 3G and competition in mobile networks,” Zennström said. “There was a sense of entrepreneurship.”

The country saw more than 500 initial public offerings over the 10 years through 2024, more than Germany, France, the Netherlands and Spain combined, according to a landmark 2024 report on Europe’s economy by former European Central Bank President Mario Draghi. It has now moved ahead of the U.S. in the number of billionaires per capita, thanks to a thriving tech startup scene and videogame industry that has produced hits like Minecraft and Candy Crush.

‘More for less’

At St. Göran’s hospital in downtown Stockholm, radiologist Karin Dembrower huddled over a computer screen, pointing to tiny light spots indicating cancer on a black-and-white image.

“We cannot see with our eyes that there is something going on here but somehow the AI is seeing” it, she said.

CHINA IS ROLLING-OVER USA AND THE EU..DANGER???

China expanding its industrial dominance, warns US business group

Chamber of Commerce says west is running out of time to sever its growing reliance on Chinese supply chain

China is rapidly expanding its capabilities in high-tech fields such as robotics © Hector Retamal/AFP/Getty Images

The US Chamber of Commerce has warned that countries have only a “finite” window to respond to Chinese policies that are deepening reliance on its supply chains and harming the global economy.

The Washington-based lobby group said Beijing was “doubling down” on state intervention in manufacturing, services and frontier technologies.

It said China was ushering in a “new phase of global impact” marked by rising trade dependence and a rapid global expansion by its companies. It is also using tools such as export controls to entrench its position in global supply chains and counter foreign diversification strategies.

The warning came in the preface to a report on new Chinese industrial policies produced for the chamber by Rhodium Group, a consultancy. The chamber said the world had underestimated previous Chinese policies, including the Made in China 2025 programme to make the country more self-reliant in critical technologies.

“The challenge the world now faces is not the result of an intelligence gap . . . Reports were published. The warnings reached senior levels of government and industry across major economies. Yet in too many cases, the response was insufficient,” the chamber concluded.

The report comes as President Donald Trump prepares to visit Beijing this week for a two-day summit with his counterpart Xi Jinping. Immediately after the leaders met in South Korea in October, Treasury secretary Scott Bessent told the FT he had warned Europe and others that Chinese exports would flow elsewhere after the US erected a “tariff wall”.

Rhodium said China’s industrial policy was evolving from sectoral intervention to an “industrial policy of everything”. It said Beijing wanted to extend its dominance in industries such as critical minerals and magnets to a broader range of industrial products. Beijing was also putting more attention on services, it added.

The report said sustained government support and weak domestic demand had driven a rapid expansion of its goods trade surplus — doubling to $2tn since 2019 — in what some have dubbed “China Shock 2.0” as the country rapidly moves away from an economy based on low-cost manufacturing.

It said China was making significant gains in industries such as chemicals, machinery and industrial equipment, following earlier significant expansion of market share in industries such as electric vehicles and clean energy.

“Global reliance on Chinese supply chains is deepening across a growing number of critical products,” Rhodium said, adding that China was using regulation and economic coercion to reinforce control over key supply chains. “The window for effective policy response is narrowing,” it added.

Camille Boullenois, lead author of the report, told the FT that China’s evolving industrial policies posed a “real threat” to the economic engine of countries such as Germany and other advanced industrial economies.

“China’s rise is broadly eroding some of the last areas where they still have a technological and industrial edge, like chemicals, autos, machinery and robotics,” she said. “China is gaining market share incredibly fast in these sectors. If countries don’t react now, the industrial landscape could look very different in just a few years.”

The report noted that China’s most recent five-year plan had for the first time included a focus on advanced technologies such as biomanufacturing, nuclear fusion energy and brain-computer interfaces. This suggested that its industrial policy was evolving from focusing on strategic sectors to a “broader effort to reshape the entire industrial ecosystem”.

The trade surplus growth represented success moving up the production value chain and exporting high-tech goods but also its success substituting domestic products for imports.

Chinese companies are also becoming more reliant on revenues from sales outside China. It said the share of total revenue from overseas for the top 500 Chinese companies reached an average of 47 per cent by 2024, roughly equivalent to the figure for US groups.

Jörg Wuttke, former head of the European Chamber of Commerce in China, said the threat was particularly acute for manufacturing and export-focused economies such as Japan and South Korea. But he said Europe faced an economic juggernaut driven by overcapacity in China in addition to a strong euro versus the renminbi.

“The Chinese are always kind enough to tell us how they will roll over us, but we never want to hear it,” said Wuttke, partner at the DGA-Albright Stonebridge consultancy. “We cannot go on like this. If you are in the Eurozone you’re a dead duck.”

UNITED NATIONS IS A JUST A MONEY PIT AND AMERICAN TAXPAYERS ARE PAYING FOR THE WASTE!

Projects—and No One’s Watching

The federal government’s own watchdog has confirmed what the numbers have long made clear: the United Nations cannot be trusted to manage the money it receives, and the State Department has been complicit in letting it happen.

A new Government Accountability Office (GAO) report released in April examined 11 U.N. capital projects worth more than $4 billion combined. It found a predictable mess: years-long delays and nine-figure cost overruns, coupled with contractor failures and unusable designs, and a State Department bureau with no formal system for monitoring any of it.

American taxpayers are left footing the bill, though. GAO confirmed the U.S. was the largest financial contributor to the U.N. in 2023. As of early 2026, the U.S. owed approximately $2.2 billion in unpaid dues, a figure the U.N. has been loudly publicizing while simultaneously running construction projects into the ground. An organization pleading poverty while mismanaging billions in active construction budgets is not a victim of underfunding. It’s a management failure dressed up as a cash crisis.

The United States Must Stop Supporting the United Nations

The single biggest disaster is the U.N.’s “Strategic Heritage Plan” in Geneva, a renovation now four years behind schedule and $91 million over its original $871.4 million budget. COVID, supply chain issues, contractor failures: GAO cites them all. So does every private construction firm that still manages to finish buildings. The U.N. has no competitive pressure and no consequences for failure, and it shows. The report, linked above, noted:

“Costs increased by 27 percent from the baseline because of the SHP’s schedule extensions.”

The project’s risk firm calculated that for every month of delay, the costs rise about $1 million.

It gets worse. The contractor on Building H, part of the same Geneva project, couldn’t manage its own subcontractors, finished two years late, and then left behind a defect list that kept growing long after “completion.”

“In December 2022, the list of minor defects that were not addressed included 10,588 issues that the SHP team had identified. By February 2024, the list had increased to 11,350 issues and included 412 on which there was disagreement with the contractor.”

Then there’s the International Telecommunication Union headquarters project. Member states approved architectural blueprints without anyone considering “cost and functionality.” Architects had “free rein,” billed for designs that were never buildable, and walked away. The GAO reported the U.N. burned through more than $20 million before scrapping the original plan entirely — not one wall built, not one foundation poured. In any organization accountable to someone, that would be a career-ending failure. Here, it barely registers.

The State Department’s Bureau of International Organization Affairs had no formal guidance for monitoring any of it. No written indicators. No threshold for when to intervene. No chain of accountability. Staff rotated every few years and largely made it up as they went.

“State IO officials said they do not systematically monitor key indicators, such as budget and schedule, and do not have clear triggers, such as percentage over budget or time behind schedule, for when to take action.”

GAO recommended State develop formal oversight guidance. And State agreed, a basic step that somehow required a congressional audit to produce.

Now consider the timing. In January, U.N. Secretary General António Guterres warned all 196 member states of “imminent financial collapse” if the U.S. didn’t pay its dues, claiming the organization would run out of money by July. Pay up, or else.

What Guterres didn’t dwell on: his organization was four years behind schedule in Geneva, had torched $20 million on unusable designs, and let a defect list balloon past 11,000 unresolved issues. This is the same organization demanding to know why Washington is hesitating.

President Trump has already pulled the U.S. from several U.N. agencies. He should keep going. The GAO report makes the case without any editorializing: $4 billion in projects, years behind schedule, $20 million torched before a shovel hit dirt, and a State Department with no system to catch any of it. We need to stop paying, and start leaving them for good.

Editor’s Note: The Democrat Party has never been less popular as voters reject its globalist agenda.

HOW RUDY MADE NEW YORK GREAT AGAIN!!!

When Rudy Giuliani Made New York Great Again

New York Former Mayor Rudy Giuliani’s recent brush with mortality reminds us how clearly his administration showed that people, not impersonal forces, make history— especially men of vision and courage like him. His mayoralty also offers today’s floundering New York the fundamental lesson that good government can make a city flourish, while bad government impairs it.

Reigning wisdom when Mr. Giuliani took office in 1994 was that the problem-ridden city was “ungovernable.” Crime had skyrocketed in the preceding decades, with murders doubling in the 1960s and doubling once more over the next two decades before reaching 2,154 in 1991—one every four hours, roughly. Dope dealers hustled on the street alongside pushy panhandlers and prostitutes. Derelicts slept alongside graffiti-smeared buildings. An epidemic of car break-ins led owners to post “No Radio” signs in their windows, and auto alarms blared indignantly at all hours. Businesses fled: The 116 major corporate headquarters in Gotham in 1971 had dwindled to 49 by 1995. Small-business owners buzzed customers in through locked doors and, at closing time, rolled down metal security gates, luring graffiti vandals.

Mr. Giuliani, a former federal prosecutor, ignored the cliché that you could cut crime only by addressing so-called root causes, poverty and racism. He instinctively grasped the theory of social scientists James Q. Wilson and George Kelling that stopping small crimes would prevent more serious crimes, just as replacing a broken window halts more window-breaking by showing that somebody watches and acts. He had seen this theory proven in the subways in the two years before his election, when Robert Kiley, head of the Metropolitan Transportation Authority, kept subway trains and stations hosed clean of graffiti and transit police chief William Bratton started arresting turnstile jumpers and graffiti vandals. Crime in the subways began to fall. When Mr. Giuliani entered City Hall, he named Mr. Bratton the city’s police commissioner.

With the mayor’s vocal support, Mr. Bratton put broken-windows policing to work, arresting “squeegee men” who smeared dirty rags across motorists’ windshields, holding them hostage for a “contribution.” Even minor crime, he showed, had no place in Mr. Giuliani’s New York—a lesson he amplified by arresting graffiti taggers and public urinators. Police stopped, questioned and frisked those suspected of carrying weapons or casing a business, dissuading the ill-intentioned from packing guns while reducing shootings. Mr. Bratton made computer maps of crime hot spots and concentrated cops where thugs operated. City Hall’s revolutionary idea was that cops should prevent crime, not solve it after it happened.

The results were spectacular. Murders fell 20% to 1,561 the first year and a further 58% to 649 in 2001, Mr. Giuliani’s last year in office. With newly safe streets and subways, New York roared back to life. As the mayor cleared sex and smut businesses out of Times Square, he enticed Disney to restore a stately vacant theater as that area’s anchor. A visionary private effort had turned Bryant Park from a dope dealers’ den into a green oasis, and that district now thronged with tourists and office workers.

Restaurants and theaters boomed. Old businesses grew, and new ones opened, including even a tech Silicon Alley. Columbia and New York University became hot schools once parents stopped fearing urban crime. With opportunity burgeoning and the city’s rich inheritance of museums, concert halls, and landmark buildings safe to use, property values skyrocketed. Global tycoons looked to city real estate as a glamorous safe haven for money. New development proliferated, and construction workers, service staff and luxury retailers all profited. New York became once more the capital of the world.

Policy can change culture, Mr. Giuliani showed. It wasn’t the legacy of slavery that had created the disproportionately black urban underclass, he understood, but the message of victimhood and helplessness sent by framing crime as an inevitable response to oppression and welfare as deserved reparations. Criminals, not society, were to blame for crime, and welfare recipients were also citizens with agency who were responsible for their own fates.

Seizing on the 1996 welfare reform act, the Giuliani administration started an ambitious workfare program. Welfare offices became “job centers” and set welfare recipients to painting park benches, raking leaves and cleaning courtrooms. Recipients learned discipline and gained self-respect. Many moved into conventional jobs and, as in the nation as a whole, caseloads dropped dramatically.

A remarkable dividend of the new approaches to crime and welfare, one with only anecdotal rather than social- science evidence, was a dramatic thaw in race relations, as fear and resentment abated. But it didn’t last.

Beginning with the De Blasio administration in 2014, the Giuliani reforms slipped away while Amazon and then Covid and Zoom sharply challenged New York’s economic model of retail stores and office towers. As it holds on to old economic engines and searches for new ones, the city urgently needs the culture of personal agency and public safety that Mr. Giuliani fostered.

Mayor Zohran Mamdani evidently believes that legacy businesses and institutions are inexhaustible wealth-generators that, even as lowtax states beckon, will enable him to cultivate the tax-eaters and punish the taxpayers. That will prove a costly and tragic mistake.

ILLEGAL ALIEN’S AND OTHERS FINALLY STARTING TO GET REMOVED FROM DRIVER ROLLS!

US States Have Revoked 28,000 Non-Domiciled CDLs

Nationally, FMCSA Says 194,000 Drivers Could Lose CDLs

“When state leaders failed to keep Americans on the road safe, we stepped in and held them accountable,” Duffy said. (Adam Gray/Bloomberg)

May 7, 2026 10:48 AM, EDT

More than 28,000 foreign truckers no longer deliver cargo in the U.S. after states revoked their non-domiciled commercial driver licenses due to stricter federal regulations expected to remove nearly 200,000 drivers from hauling freight.

Transportation Secretary Sean Duffy highlighted the revoked non-domiciled CDLs among a list of one-year accomplishments to support the trucking industry under the Trump administration.

“We’ve brought back common-sense rules of the road including requiring English-language proficiency and valid working documents for foreign drivers,” Duffy said May 1. “The Trump administration has hit major milestones in our efforts to rein in the trucking industry which has been allowed to operate like the Wild, Wild West for far too long.”

He recalled how the U.S. Department of Transportation spearheaded a Federal Motor Carrier Safety Administration audit last June of states issuing non-domiciled CDLs and commercial learner’s permits.

FMCSA Enforcement Actions Sent to Numerous States

Duffy’s announcement stated that 26 states received “official enforcement actions” from FMCSA.

Auditors determined that more than 30 states had issued illegal licenses and permits to foreign truckers.

FMCSA previously stated that more than 30 states “issued tens of thousands [of] non-domiciled CDLs contrary to federal regulations.”

These violations involved driving credentials issued to:

Drivers with noncompliant non-domiciled CDLs beyond a driver’s expiration date for lawful U.S. presence
Citizens of Mexico and Canada who aren’t entitled to non-domiciled licenses due to a reciprocal agreement enabling them to use their country-issued licenses
Lawful permanent U.S. residents who should have been issued regular CDLs instead of non-domiciled ones
Foreign truckers without evidence verifying legal U.S. residence under FMCSA regulations

Trucking Industry Expected to Lose 194,000 Foreign Drivers

Duffy’s announcement emphasized FMCSA’s final rule in February 2026 that took effect March 16 “to stop unqualified foreign drivers from obtaining a non-domiciled CDL. More than 28,000 illegally issued licenses have been successfully revoked nationwide.”

This statistic represents 14% of the 194,000 current non-domiciled CDL holders expected to “exit the freight market,” as predicted by FMCSA’s final rule.

The final rule stated that FMCSA recognizes there is a population of current non-domiciled CDL holders who will no longer meet new eligibility standards, as well as new drivers with a different immigration status who will be ineligible.

The narrower regulations governing state licensing of foreign truckers are expected to result in a much smaller national pool of 6,000 foreign truckers able to hold these non-domiciled driving credentials.

(THEPALMER/Getty Images)

FMCSA stated that “given the need for non-domiciled CLP and CDL holders to be vetted properly, this final rule limits individuals eligible for non-domiciled CLPs and CDLs to those maintaining lawful immigration status in these employment-based nonimmigrant categories: H-2A and H-2B nonimmigrant visas for foreign workers in agriculture or seasonal/peak-load non-agricultural roles, or E-2 investor visas.”

The revised FMCSA regulations now restrict eligibility to statuses subject to consular vetting and interagency screening of driver history records to close a significant safety gap, because such screening had been required for U.S. citizens but not for non-domiciled foreign truckers.

Under the previous regulations, states lacked access to either a driver’s historical record or concurrent driving record outside the United States. State driver license agencies also didn’t receive notifications of serious traffic violations that occurred in a foreign country during the validity of a non-domiciled CDL. The consular vetting process remedies those past deficiencies.

State Department procedures require consular officers to assess applicants’ driving history, experience and licensing eligibility when reviewing H-2A, H-2B and E-2 visas.

More Non-Domiciled Drivers Could Lose Licenses

More foreign truckers could lose their licenses if they live in a state “prohibited from issuing CLPs or CDLs because the state’s CDL program is decertified,” FMCSA’s final rule predicted.

Although states aren’t required to issue these driving credentials, most do. FMCSA’s enforcement actions after the audits require states to complete corrective actions or face withheld federal grants and possible prohibition from issuing non-domiciled CDLs and CLPs for prolonged noncompliance.

Both California and New York have found themselves one step closer to losing the ability to issue driving credentials to foreign truckers after FMCSA issued final noncompliance notices and permanently rescinded millions of dollars in federal funds as a first-step sanction.

Duffy’s recent announcement also contained a warning to noncompliant states.

“When state leaders failed to keep Americans on the road safe, we stepped in and held them accountable and we’re just getting started,” he declared.

North Dakota has resumed issuing non-domiciled CDLs after recently receiving FMCSA recertification.

Oregon and Nevada opted to permanently cease issuing their versions of non-domiciled CDLs and CLPs to foreign truckers.

THE MET GALA…WE ALL ASPIRE TO BE ATTENDEES?, WHAT A PARTY!

The Met Gala Is Entering Its Billionaire Era With Jeff Bezos and Lauren Sánchez

The Met Gala draws criticism as Jeff Bezos and Silicon Valley firms take a larger role in funding and shaping the iconic event.

Amazon founder Jeff Bezos and his wife, Lauren Sánchez Bezos, are pictured at the 2024 Met Gala. Photo by Kevin Mazur/MG24/Getty Images for The Met Museum

The official co-chairs of Monday’s Met Gala include Beyoncé, Nicole Kidman, Venus Williams, and, of course, Anna Wintour. Yet the star-studded lineup has been overshadowed by the event’s “honorary chairs,” a largely ceremonial title that has drawn outsized attention this year. Instead of designers, actors, musicians or athletes, the roles have gone to billionaires Jeff Bezos and his wife, Lauren Sánchez Bezos.

This isn’t the first time members of the tech elite have appeared at the Met Gala—Bezos himself attended in 2012, 2019 and 2024. But the prominence of his involvement this year has sparked a wave of criticism, shining a light on Silicon Valley’s increasingly influential role in fashion’s biggest night.

A growing relationship between the Met Gala and tech executives is “a new phenomenon in terms of the broader history of the gala, which was really about fashion,” Deirdre Clemente, a fashion historian at the University of Nevada, Las Vegas, told Observer.

Founded in 1948 by publicist Eleanor Lambert, the Met Gala began as a fundraiser for the Metropolitan Museum of Art’s Costume Institute, attended primarily by New York City socialites. It was a far cry from today’s global spectacle. The shift toward celebrity accelerated in the 1970s under former Vogue editor-in-chief Diana Vreeland, and by the time Wintour took over as chair in 1995, the event was well on its way to becoming a cultural juggernaut. (Wintour recently stepped down as editor-in-chief of Vogue U.S. but remains its global editorial director.)

As the Met Gala’s profile has risen, so has its price of entry. Tickets—available only to guests approved by Wintour—cost $100,000, while tables start at $350,000. As tech companies have amassed enormous wealth, they’ve increasingly stepped in to foot the bill in exchange for cultural cachet. This year’s table buyers reportedly include Amazon, OpenAI, Meta and Snap.

“I’m calling it the ‘Tech Gala,’ because so much tech has gotten involved over the last decade,” Amy Odell, the author of the 2022 Wintour biography Anna, told Observer. “Over the years, the price of admission has become so high that it’s just like, who else can afford it?”

Bezos, the founder of Amazon, and Sánchez Bezos are also serving as the lead sponsors for this year’s event. But it was the announcement of their roles as honorary chairs in February that ignited backlash. Despite Wintour defending Sánchez Bezos as a “wonderful asset to the museum and the event” in a recent CNN interview, criticism has continued to mount. An anti-billionaire activist group known as “Everyone Hates Elon,” has even plastered New York City with posters calling for a boycott.

Man puts up red poster reading 'Boycott the Bezos Met Gala.' — Posters condemning the involvement of Jeff Bezos and Lauren Sánchez Bezos in the Met Gala have popped up across New York City. Photo by Angela Weiss/AFP via Getty Images

For some observers, however, the presence of ultra-wealthy figures represents less a departure than a return to the gala’s fundraising roots. “If you’re talking about raising money, you invite the people who have the most money,” Adrienne Jones, a fashion professor at the Pratt Institute, told Observer. “Who else to invite to be an honorary chair but one of the wealthiest men on the planet?”

Silicon Valley’s growing presence at the Met Gala has been building for years. Amazon sponsored the event in 2012, followed by Apple in 2016. TikTok backed the gala in 2022, the same year OpenAI created an A.I. installation for the Costume Institute’s accompanying exhibition. Attendees have included not only Bezos but also Elon Musk, Tim Cook and Sergey Brin.

In 2022, Wintour even invited Sam Bankman-Fried, the FTX founder later convicted of fraud, to attend and potentially sponsor the event. He ultimately canceled at the last minute, reportedly frustrating Wintour’s team, according to Michael Lewis’ 2023 book Going Infinite.

Despite occasional controversy, tech companies remain eager to participate. A six-figure fee “is a drop in the bucket to them,” said Odell. “What they get in exchange is so much more valuable, which is to be seen as glamorous and cool and to get that kind of exposure to a largely female audience.”

This year’s backlash, however, signals a shift in public sentiment. Critics are responding not just to tech’s presence but to Bezos and Sánchez Bezos being “front and center this time,” Jones said, pointing as well to growing concerns about wealth inequality and the labor impacts of A.I.

Whether that backlash will alter the Met Gala’s reliance on Silicon Valley remains uncertain. “They opened the door for Silicon Valley to now be a part of this—and the money they’re bringing with it,” said Jones.

$800,000,000 YES $800 MILLION PAID BY THE LARGEST SETTLEMENT FOR ABUSE BY NEW YORK ARCHDIOCESE…IS THIS REALLY A RELIGION OF GOOD WORKS AND EXAMPLE OF JESUS?

Archdiocese of New York Agrees To Pay $800,000,000 in Sex Abuse Settlement WHY ARE THESE ABUSERS in the funny hats SMILING?

Two years after the Archdiocese of Los Angeles reached an $880 million settlement with men and women who survived childhood sexual abuse at the hands of Roman Catholic priests and clergy in their diocese, the Catholic Archdiocese of New York is following suit, agreeing to pay more than $800 million to its own sexual abuse survivors.

So far, the Catholic Church has paid out more than $5 billion in settlements, which has bankrupted at least 19 dioceses.

The archdiocese has been planning this for a while. Along with selling off buildings and laying off staff, including the sale of their New York headquarters for $100 million, the Archdiocese is suing its insurance company, Chubb.

The archdiocese claims that “even though we have paid them over $2 billion in premiums by today’s standards, [Chubb] is now attempting to evade their legal and moral contractual obligation to settle covered claims which would bring peace and healing to victim-survivors.”

Chubb insists that it is not obligated to settle several of these claims, some of which go back over 80 years, because the church knew about the abuse and did nothing to stop it, making the incidents ineligible for coverage.

A letter sent by the Archbishop of New York, Ronald Hicks, notes that the matter has been a painful process, but they hope that all parties accept. If so, they would each received around $215,000. It reads in part:

As you may have heard, the Archdiocese of New York and the Plaintiff’s Liaison Committee (PLC), which represents a majority of victim-survivors, have been working hard for several months to reach agreement on a global settlement of all sex abuse lawsuits. The parties have been working to create the framework of a comprehensive arrangement that will deliver compensation to victim-survivors faster and more efficiently than the traditional legal process. These discussions have been facilitated by Judge Daniel J. Buckley, a highly experienced neutral third-party mediator. Although much work remains to be done before a settlement can be finalized and consummated, I am cautiously optimistic about the path we are on.

Members of the PLC, attorneys who have long advocated for victim-survivors, have begun reaching out to counsel for all impacted individuals and it is our sincere hope to achieve full participation; we cannot begin to compensate victims until full participation is achieved. If a truly global settlement can be achieved, compensation will become available to victim survivors in the fastest, most comprehensive manner possible, without the need for lengthy painful litigation for victim-survivors or bankruptcy proceedings for the Archdiocese. Though I am new to the Archdiocese of New York, I recognize the immense effort that this Archdiocese has dedicated to supporting victim-survivors over the past decade. My predecessor, Timothy Cardinal Dolan, established the Independent Reconciliation and Compensation Program (IRCP) in 2016 which provided millions in compensation to victim-survivors. The Archdiocese has sold off the majority of its real estate holdings and made significant cuts to our staff and other operational expenses. These cuts have been painful for us, but they were necessary measures to secure the resources needed to compensate victim-survivors.

It cannot be denied that this has been a painful process – most significantly so for the victim-survivors and their families and loved ones who have suffered, in most cases, for decades. I pray that all of us, as the Family of God, will come together to support and affirm these individuals and take these next steps to bring about some healing and peace.

SOUTHERN POVERTY LAW CENTER IS JUST ANOTHER SCAM!

Fake Perils Make Real Money

You didn’t need a legal case to know that the Southern Poverty Law Center, to stay alive, badly needs the perils it claims to deplore. The federal indictment, which charges the nonprofit with wire fraud, false statements and conspiracy to conceal money laundering, alleges that the Montgomery, Ala.-based group paid hefty sums to “informants” supposedly operating inside extremist groups. Millions of dollars allegedly went to these “field sources”—Klan members, neo-Nazis—even as the SPLC labeled the same organizations dangerous extremists on its website.

One of the indictment’s claims, if borne out, so perfectly captures the cynicism of radical politics in the 2020s that you’d call it far-fetched if you read it in a novel by Christopher Buckley. The indictment alleges that one source “was a member of the online leadership chat group that planned the 2017 ‘Unite the Right’ event in Charlottesville, Virginia and attended the event at the direction of the SPLC.” This person, say prosecutors, “made racist postings under the supervision of the SPLC and helped coordinate transportation to the event for several attendees.” Between 2015 and 2023, the nonprofit paid this informant $270,000.

The SPLC’s lack of compunction amazes, but its intrigues flow from the nature of the activist nonprofit enterprise. Like almost all advocacy organizations, the SPLC faces the temptation to exaggerate the urgency of its mission and the extent of its accomplishments. Donors respond to big claims and menacing specters. Hence the SPLC’s desperate effort to defame people and organizations on the political right—Charles Murray, Prager University—as promoters of ” hate” and “extremism.” The war for America’s soul may go well or poorly, but the money’s got to keep flowing.

Which is why that Unite the Right rally was the best thing ever to happen to the SPLC. A gathering of, at most, 500 young nincompoops high on racist humbug metamorphosed, in the minds of anxious Americans—and with the media’s help—into a mass movement of brownshirts ready to seize the country’s institutions and overthrow its government. Donations to the nonprofit ballooned in the year after the rally.

The SPLC didn’t create the Charlottesville rally, though its machinations probably helped at the margins. The import of the episode, though, lies in the fact that the nonprofit’s leaders plainly felt it had an interest in making the threat of white racial bigotry appear to hold more sway over American life than it does. “Interest” in the crassest, monetary sense.

The modern liberal outlook, to borrow the political philosopher Kenneth Minogue’s metaphor, must have dragons to slay. When the dragons diminish in size or die out altogether, the civic-minded liberal naturally wants to invent bigger ones, if only to have things to worry about. As with every such mental pathology, this one offers financial rewards to determined exploiters.

The late Jesse Jackson based a lucrative career on the fiction that America in the 1980s and ’90s still excluded black Americans from opportunity in the way the South had under Jim Crow. The static

history of racist America he helped to propagate allowed Jackson, in the 2000s and 2010s, to threaten large companies with boycotts on the grounds that they hadn’t done enough to mitigate racism. His attacks would conveniently cease when the companies agreed to donate to Jackson’s political operation.

Al Sharpton followed the same path. Only Mr. Sharpton, unapologetic perpetrator of the 1987 Tawana Brawley hoax, spun the perception of perennial racism into a decadeslong media career. Ibram X. Kendi, Robin DiAngelo and other “antiracist” theorizers attained celebrity status by persuading millions of well-meaning people to fear and loathe nonexistent monsters.

The District of Columbia teems with nonprofits dedicated to the proposition that one thing or another menaces the citizenry. Human Rights Campaign, to take one example, regularly informs its followers and donors that gay, “trans” and “gender-expansive” Americans suffer from routine violence and bigotry at the hands of their countrymen. In 2025, HRC brought in $46 million in contributions.

Climate catastrophism has grown into a global grift, with poor countries demanding billions in “reparations” from nations with functioning markets, but consider climate alarmism’s role in American politics. For decades, the Environmental Protection Agency and related government bodies have doled out grants to climate- related nonprofits that return the favor by churning out apocalyptic reports about an always-imminent climate crisis. The 2022 Inflation Reduction Act supersized that effort. In 2023, the Biden administration came up with what it called the American Climate Corps, to “mobilize the next generation of clean energy, conservation and resilience workers”: that is, to send millions of public dollars sluicing through climate nonprofits around the country.

To its credit, the Trump administration canceled the program, but similar funding streams proliferate across federal and state agencies. A cynical observer might feel inclined to use the word “racket”: Environmental agencies fund activist groups, which make apocalyptic claims more credible, thus enabling the agencies to demand more funding and regulatory authority from government budgetwriters. Now that’s what I call sustainability.