In 2005, the U.S. Department of Justice announced in this press release that Anne Sholtz, a then-high-flying entrepreneuer instrumental in creation of the planet’s first smog cap-and-trade, had admitted to defrauding an obscure New York-based energy trader called AG Clean Air. Sholtz’s little-noticed plea and corporate bankrutpcies ignited a mess that still has many smarting and confused, while giving global warming skeptics such as Texas Rep. Joe Barton ammunition to question the prudence of Pres. Obama’s hope for a greenhouse gas market. Oh yeah, there’s also this issue of whether Sholtz, a former Caltech economist and owner of a resplendent mansion, perpetrated an earlier fraud –with the supposed help of ex-CIA and military operatives — that never went investigated or flagged by authorities. See my story about her and “Operation Bald Headed Eagle” for the particulars.
Now, lookie here. The apparent parent company of AG Clean Air, is one of the creditors of the Tribune Corp. bankruptcy. For those who don’t know, Tribune owns the Los Angeles Times, our hometown paper, the Chicago Tribune and other media assets. As this story shows, former Disney chief executive Michael Eisner is bidding to become Tribune’s post-bankruptcy chairman.
Here’s a crucial passage: “… Tribune and its creditors are still struggling to negotiate a settlement around charges that (Sam) Zell’s 2007 leveraged buyout was a case of “fraudulent conveyance,” meaning the transaction rendered the company insolvent from Day One. That settlement would serve as the basis for a plan of reorganization, but depending on how negotiations go, it could be months in coming or the case could easily devolve into litigation.
Nobody in the case doubts that senior creditors led by money center bank JPMorgan Chase and two hedge funds, Angelo, Gordon & Co. and Oaktree Capital Management, will end up owning Tribune by virtue of their $8.6 billion in claims …”
In a earlier article, the L.A. Times depicted Angelo, Gordon & Co. as a “distressed-debt hedge fund.” Here’s the company’s website, so judge for yourself.
When I contacted the company for comment about my last story on Shotz last summer, the PR flack initially denied there was a connection between AG Clean Air (which apparently stood for Angelo, Gordon Clear Air) and Angelo, Gordon & Co. until I disputed otherwise and said the court documents show the exact same New York address for both entities: 245 Park Ave., 26th floor, New York, NY 10167.
Coincidene? I think not.
Whether AG Clean Air still exists is not clear. That the parent is the same one entangled in the debacle that Sam Zell created with his highly leveraged Tribune purchase some years back seems undeniable.
* The startling picture of smogged out L.A. was the cover shot for a Wired magazine feature story about Southern California’s epic fight for blue skies against it’s own people’s auto addiction. They were gracious to highlight our book, Smogtown: the Lung-Burning History of Pollution in Los Angeles, and interviewed me. Here’s a little blurb:
“… People in Los Angeles were very proud of their air,” said Chip Jacobs, one of the authors of Smogtown: The Lung-Burning History of Smog in Los Angeles. “They said that L.A. was the land of pure air, and that moving there could cure tuberculosis and alcoholism. They thought there had to be one simple answer.” The day after the first big smog, city officials pointed to the Southern California Gas Company’s Aliso Street Plant as the source of the thick cloud. The facility manufactured an ingredient in synthetic rubber called butadiene. Public pressure temporarily shut down the Aliso Street Plant, but the smog episodes continued to get even worse. Undeterred, Los Angeles Mayor Fetcher Bowron announced in August that there would be “an entire elimination” of the problem within four months. But the search for the culprit of the “gas attacks” — and the ensuing battle to curb the culprit’s emissions — was just beginning …”
* An interesting MSNBCpiece about scientists’ progress in creating artificial lungs. Gosh, L.A. would be the perfect test city.
” … Nearly 400,000 people die of lung diseases each year in the United States alone, according to the American Lung Association, and lung transplants are far too rare to offer much help. But how to replicate these spongy organs? Niklason’s team stripped an adult rat’s lung down to its basic structural support system, its scaffolding, to see if it would be possible to rebuild rather than start completely from scratch …”
* For now, forget using the prospect of a green-jobs bonanza to convince Congress and the American public to support the national climate bill stalling in Washington, D.C. From the L.A. Timesblog.
* Speaking of cap-and-trade, California and other regions, though not the first ones envisioned, may enact their own greenhouse market. Good luck getting voters to support it in this jobless recovery or keeping fraud at bay. From the L.A. Timesstory.
“As the nation’s most populous state and the world’s eighth-largest economy, California wields significant influence. International and national controls are needed to curb global warming, Gov. Arnold Schwarzenegger said Tuesday, “but California and the rest of the Western Climate Initiative partners are not waiting to take action.”
” … The Western initiative would cut emissions 15% below 2005 levels. It would transition the region to “a green economy that will reduce our dependency on oil, increase our energy security and create jobs and investment now,” Schwarzenegger said in a statement. The trading program would allow companies to meet targets by purchasing less expensive “offsets” from forests, agriculture or garbage dumps when companies in those sectors store carbon dioxide beyond what they would have emitted in the normal course of business …”
* I’ve probably written a dozen stories about L.A.’s unheralded crisis with deadly hexavalent chromium (otherwise known as “chrome-six,” or the Erin Brockovich chemical) creeping and moving through its acquifiers and land. In 2004, I did a series about it for Southland Publshing and in 2000 I covered the subject for the L.A. Times. Unfortunately, the problem is getting worse. Here’s the L.A. Daily Newscoverage (and the Daily News deserves lots of credit for its mid-1990s stories on chrome-six related to Lockheed Corp; I was lucky to have on the team that wrote about it). With all the focus on greenhouse gases and the drought, we’ve all forgotten about a deadly industrial poison spreading through wells and leaving local officials with tricky decisions to make.
“Metropolitan Los Angeles, extending to Riverside and Long Beach, remains the smoggiest city in the United States, with an average of more than 140 days a year of dangerous ozone levels, the American Lung Assn. reported Wednesday in its annual assessment.
All of the nation’s 10 smoggiest counties are in California, with San Bernardino, Riverside, Kern, Tulare and Los Angeles leading the pack. And the state’s cities and counties, with their ports, refineries, power plants and crowded freeways, rank near the top for particle pollution.
“This is not just a nuisance or a bother,” said Bonnie Holmes-Gen, the lung association’s California policy director. “Thousands of people are being rushed to emergency rooms. Thousands of people are dying early as a result of air pollution…. It is a crisis.”
The report comes at a time of conflict over the state’s efforts to slash emissions. Citing the recession-battered economy, trucking and construction firms are seeking to delay California’s rules to limit diesel pollution from operating big-rigs, forklifts and other equipment …”
Let Freddie Mercury reinforce the point: We are the champions … of smog … mostly by our own making!
“In the first global assessment of the impact of ozone on climate warming, scientists at the NASA Goddard Institute for Space Studies (GISS), New York, evaluated how ozone in the lowest part of the atmosphere (the troposphere) changed temperatures over the past 100 years. Using the best available estimates of global emissions of gases that create ozone, the GISS computer model study reveals how much this single air pollutant and greenhouse gas has contributed to warming in specific regions of the world.
Ozone was responsible for one-third to half of the observed warming trend in the Arctic during winter and spring, according to the new research. Ozone is transported from the industrialized countries in the Northern Hemisphere to the Arctic quite efficiently during these seasons. The findings will be published soon in the American Geophysical Union’s Journal of Geophysical Research-Atmospheres …”
California is “failing,” or so says the British. Excuse us if I’ve heard this one before from supposed sharp-eyed observers convinced we’re past the tipping point to social doom. We dip into outsiders fancy for seeing ruin before the ruin is really there in our book Smogtown: the Lung-Burning History of Pollution in Los Angeles. Imagine that: California actually made it out of the 1970s1
“California has a special place in the American psyche. It is the Golden State: a playground of the rich and famous with perfect weather. It symbolises a lifestyle of sunshine, swimming pools and the Hollywood dream factory.
But the state that was once held up as the epitome of the boundless opportunities of America has collapsed. From its politics to its economy to its environment and way of life, California is like a patient on life support. At the start of summer the state government was so deeply in debt that it began to issue IOUs instead of wages. Its unemployment rate has soared to more than 12%, the highest figure in 70 years. Desperate to pay off a crippling budget deficit, California is slashing spending in education and healthcare, laying off vast numbers of workers and forcing others to take unpaid leave. In a state made up of sprawling suburbs the collapse of the housing bubble has impoverished millions and kicked tens of thousands of families out of their homes. Its political system is locked in paralysis and the two-term rule of former movie star Arnold Schwarzenegger is seen as a disaster – his approval ratings having sunk to levels that would make George W Bush blush. The crisis is so deep that Professor Kevin Starr, who has written an acclaimed history of the state, recently declared: “California is on the verge of becoming the first failed state in America …”
Scoff as you may at predictions of California’s tragic early demise, don’t dismiss what some “green roofs” can do as one salvo in the battle against global warming. MSNBC story.
Feeling itchy and green all over? You’re not alone. We’re in era of environmental anguish, and unfortunately Tylenol and a margarita aren’t much relief. New York Times post.
We like this move as insurance if Obama-backed legislation focused on dramatically slowing U.S.-generated greenhouse gases while improving our energy efficiency and use of renewables goes down in flames to partisan politics. L.A. Times story.
Here’s a description and other details about this sweet honor, which was presented to us and other writers on Saturday, Oct. 5 by the city of Santa Monica:
The Green Prize is intended to “encourage and commend authors, illustrators, and publishers who produce quality books for adults and young people that make significant contributions to, support the ideas of, and broaden public awareness of sustainability. The City of Santa Monica’s Sustainable City Plan defines sustainability as “meeting current needs – environmental, economic, and social – without compromising the ability of future generations to do the same.”
Did I mention how tickled we are to be receiving this, particularly on top of the other awards we’ve fortunate enough to collect? If not, thank you SANTA MONICA!
“If you think the air is bad in Los Angeles right now, you probably didn’t live there for much of the past century. When the thick, view-obscuring gray haze first appeared in the city on July 26th, 1943, nobody knew quite what to think of it. Was some factory suddenly spewing tons of pollution in to the air? Was it some kind of chemical attack? Citizens of this Southern California city didn’t yet realize the cost of their own modernized lifestyle, wherein practically every single resident owned their own vehicle.
“Smogtown: The Lung-Burning History of Pollution in Los Angeles” by Chip Jacobs and William Kelly tracks the smog invasion of LA from the first moment it arrived through the many efforts to combat it. This might not sound too exciting – especially for people who aren’t hardcore environmentalists interested in every detail of our nation’s struggle with pollution – but you’ll be pleasantly surprised to find that Smogtown is thoroughly entertaining from start to finish.
It’s a dramatic story, playing out like it was written for the screen, with clear protagonists and villains – and humor peppered throughout. While Smogtown does an excellent job of providing the hard facts about how the pollution got so bad, the weakness of the government in controlling it and the difficulty of convincing Los Angelenos to sacrifice any part of their lifestyle to make it go away – it’s also a gripping tale that will keep you eagerly turning the pages. What with the terrified citizens crashing their cars in panic at the appearance of the smog and bewildered, ineffectual government officials bumbling about, it’s almost like Godzilla, but with pollution as “the beast”.
Of course, we all know how this story ends. Air pollution is still a major concern in Los Angeles, and despite knowing that the automobile is the source, LA is still crawling with cars and lacking a decent public transit system. But don’t let that stop you from giving this lively story a read. It’s got sex, plenty of Hollywood glamour, scandal, and murder – but never falters in its brilliant coverage of an incredibly important environmental issue …”
Los Angeles’ cancer alley – an un-love story of vulnerable lungs, put-upon people and a globalized transhipment mecca that coughs out our biggest air pollution threat. There’s a new environmental justice army (well, sort of new) tackling the issue. From today’s fine L.A. Timesstory:
” … Eight years ago, he ran into an old friend at a sweatshop protest in a Glendale mall: Gilbert Estrada was working on a master’s thesis on highway building through East L.A.’s Mexican neighborhoods. They traded tales of aching chests from air pollution, of chemical spills that sparked evacuations in elementary school, and of playing around 55-gallon drums marked with skulls and crossbones …”
And in case you thought smog was now our the green version of a red-headed stepchild, check out this story about the Obama White House and EPA reviewing an important ozone standard. MSNBCreports.
Is it really possible to keep greenhouse gases from even hitting the air? A New York Timesstory looks at one model.
“Poking out of the ground near the smokestacks of the Mountaineer power plant here are two wells that look much like those that draw natural gas to the surface. But these are about to do something new: inject a power plant’s carbon dioxide into the earth …”
Plus, a GW call for world unity. How’s that working out? Link (from N.Y. Times) Could be the issue of our time.
“… Hotels are not the only offenders in this kind of petty green fakery. Environmentalism is “in” at the moment, and corporations feel great pressure to prove their credentials. But it’s not easy being green. Some companies, like those at the top of NEWSWEEK’s 2009 Green Rankings, have embraced conservation for real. They build headquarters with solar panels and rainwater collection systems; they think of the environmental impact of every aspect of their businesses and actually change the way they do things to reduce waste. But this is labor intensive, often expensive, and takes commitment. Faced with that, many corporations take a different approach: They don’t do much of anything to change the way they do business, but make a big show of their dedication to Mother Earth …”
The mob gets in on the pollution racket. Like duh. From MSNBC.
” … Giordano said the former mobster, Francesco Fonti, from the Calabria-based ‘ndrangheta crime syndicate, has claimed the mob sank “hundreds” of barrels of illegally disposed of waste …”
The demise of Anne Sholtz’s once-grand life is evident in the smaller things. It’s there in the GPS-tracking bracelet — standard issue for felons in home detention — that looped around her ankle for a year, and in her near-dormant passport. It’s traceable in her pillow, which rests today in leased home miles from the $5-million hillside estate that had broadcast her transformation from Caltech economist to business phenom.
Yes, the wreckage from that existence — the economizing, the isolation from connected friends who now shun her — is graspable.
Where the picture turns as murky as whisky-brown Southern California smog is how Sholtz, as a then-thirtysomething go-getter, was able to deceive the very air-pollution market she helped conceive, and the lessons that holds for keeping financial crooks out of the trillion-dollar, greenhouse-gas trading system that President Obama has trumpeted as a key to curbing global warming.
Unless you’re in the arcane field of emissions trading, chances are you’ve probably never heard of Sholtz before. Last April, the former Pasadena emissions-broker was convicted in federal court of fraud relating to a multimillion-dollar deal for credits in Southern California’s novel smog-exchange. Despite pleas that she sock Sholtz with years behind bars, US Central District Court Judge Audrey Collins gave her just a year in home confinement.
Fortunate with a light sentence in that downtown LA courtroom, Sholtz nonetheless sustained heavy losses outside of it, squandering, among other potential, her chance to build a unique and lucrative pollution-trading business, with access to Obama or Gov. Arnold Schwarzenegger as an industry confidante. Those opportunities gone, she now drives her mother’s car, not the Mercedes or SUV she once did. Rather than expanding her ideas into climate change, she checks in with her parole officer.
Blown prosperity for Sholtz, it’s been no bonanza for others, either.
Between criticism over its secretive, mixed-bag prosecution of her and evidence of Sholtz’s role in a scheme to extract millions in overseas US aid with men purporting to be American intelligence and military operatives, the Department of Justice’s LA office probably wishes she would just fade away. Local smog regulators at the South Coast Air Quality Management District (AQMD), whose market-based regulation proved vulnerable to her deceptions, can relate.
Trouble is some events are just too big to disappear. And the Sholtz case, no matter its relative obscurity or connection to complex regulations, fits that mold because it underscores the need for vigorous oversight of emissions markets against seemingly inevitable Wall Street-style chicanery.
